Baltic
Dry Index. 2118 +05 Brent Crude 104.97
Spot Gold 1715 US 2 Year Yield 3.10 -0.15
Coronavirus
Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 22/07/22 World 572,834,401
Deaths 6,398,503
There can be no other criterion, no other standard than gold. Yes, gold which never changes, which can be shaped into ingots, bars, coins, which has no nationality and which is eternally and universally accepted as the unalterable fiduciary value par excellence.
Charles de Gaulle.
This Friday morning, rumours out of Turkey of a tentative deal to get grain exports moving again out of Ukraine.
More churning action in the stock casinos.
The US Treasury yield curve is now inverted from the one year yield out. Recession ahead.
With EU inflation running at 8.6 percent, the ECB ditches its negative interest rate and returns to zero percent. Way to go, EUSSR, that’ll show them!
President Biden comes down with a mild case of Covid-19.
Belarus issues a serious warning. No one is listening.
The summer silly season gets underway in earnest.
Asia-Pacific
markets mixed as inflation in Japan inches up
SINGAPORE — Shares in the Asia-Pacific were mixed
Friday as investors digest Japan’s inflation data.
The Nikkei 225 recovered
from earlier losses to rise 0.45% and the Topix index climbed 0.28%.
Official data released Friday
showed that prices
in Japan rose 2.2% in June compared to a year ago, in line with
analysts’ expectations.
“June CPI data shows that cost-push inflation has
stabilized, primarily due to a sharp decline in fresh food prices,” according
to ING’s regional head of research, Robert Carnell, and senior economist Min
Joo Kang in a Friday note.
“However, inflation
is likely to accelerate again in the coming months due to the low base
comparisons with last year and could exceed 2.5%YoY, while the core inflation
rate will likely remain above 2% for the remainder of the year,” the note said,
adding that the Bank of Japan is likely to stay accommodative since inflation
is not demand driven.
Japan’s central
bank on Thursday kept rates on hold at ultra-low levels, as expected.
Asia-Pacific markets mixed
South Korea’s Kospi was 0.25%
lower, but the Kosdaq rose 0.13%.
In Australia, the S&P/ASX 200 was
0.2% higher.
Hong Kong’s Hang Seng index rose
0.12%, but mainland China markets gave up earlier gains to fall. The Shanghai Composite shed
0.33% and the Shenzhen Component lost
0.68%.
MSCI’s broadest
index of Asia-Pacific shares outside Japan sat just above the flatline.
Overnight in the U.S., the
tech-heavy Nasdaq Composite rose 1.36% to close at 12,059.61 as Tesla shares
surged. The S&P 500 gained nearly 1% to end the session at 3,998.95, and
the Dow Jones Industrial Average advanced 162.06 points, or 0.51%, to 32,036.90.
More
Asia
markets: Japan CPI inflation, currencies, oil (cnbc.com)
Nasdaq futures
slide as Snap results weigh on technology stocks
Nasdaq futures fell in early trading Friday as investors digested a fresh
batch of corporate earnings and disappointing results from Snap, which sent
social media shares reeling.
Futures tied to the Dow Jones Industrial Average slipped
0.11%, or 36 points. S&P 500 futures fell 0.36% and Nasdaq 100 futures
tumbled 0.71%.
Shares of the Snapchat parent company plummeted a whopping
26% after posting
second-quarter results that fell short of analysts’ expectations and noting
that it plans to slow hiring.
The results from Snap weighed on other social media and technology stocks
investors feared could get impacted by slowing online advertising sales. Shares
of Meta Platforms, Alphabet, Twitter and Pinterest fell 5.2%, 2.9%, 1.8% and
7%, respectively, following the news.
The Invesco
QQQ Trust slid 0.72% after hours.
The news ruined what has been a hot streak for tech shares.
The Nasdaq Composite posted
its third straight positive session on Thursday. That came on the
back of positive quarterly results from Tesla, which popped nearly 10% on
Thursday.
More
Nasdaq
futures slide as Snap results weigh on technology stocks (cnbc.com)
European Central
Bank surprises markets with larger-than-expected rate hike, its first in 11
years
The European Central Bank on
Thursday increased interest rates for the first time in 11 years in an attempt
to cool rampant inflation in the euro zone.
The ECB, the central bank of the 19
nations that share the euro currency,
surprised markets by pushing its benchmark rate up by 50 basis points, bringing
its deposit rate to zero. Traders had expected a smaller hike of 25 basis
points.
“The Governing Council judged that
it is appropriate to take a larger first step on its policy rate normalisation
path than signalled at its previous meeting,” the ECB said in a statement
Thursday.
The Frankfurt, Germany, institution had kept rates
at historic lows, in negative territory since 2014, as it dealt with the
region’s sovereign debt crisis and the coronavirus pandemic.
The euro rose to a
session high on news of the more aggressive rate hike, to trade at $1.0257. The
yield on the 10-year Italian bond also jumped on the news, extending gains
after reacting to the resignation of Prime Minister Mario Draghi earlier
Thursday.
The ECB also said
that this move in interest rates “will support the return of inflation to the
Governing Council’s medium-term target by strengthening the anchoring of
inflation expectations and by ensuring that demand conditions adjust to deliver
its inflation target in the medium term.” The central bank’s inflation target
is 2%.
The ECB had
previously signaled it would be increasing rates in July and September as
consumer prices keep surging, but it was unclear whether it would go as far as
bringing rates back to zero. The bank’s deposit rate is now 0%, the main
refinancing operations rate is 0.5% and the marginal lending facility is at
0.75%.
----Seema Shah, chief strategist at
Principal Global Investors, said via email that the ECB is not tightening its
policy against a backdrop of strong economic growth “and certainly not
accompanied by celebratory smiles.”
“The ECB is hiking
into a drastically slowing economy, facing a severe stagflationary [when
inflation is high and growth is low] shock that is quite beyond
its control, while also facing an Italian political crisis which presents
a difficult sovereign risk dilemma,” she said, adding “there is no other
developed market Central Bank in a worse position than the ECB.”
Carsten Brzeski,
global head of macro at ING Germany, said: “For the first time since 2011, the
Bank has hiked interest rates and did so with a bang. Hiking rates by
50 basis points and softening forward guidance shows that the ECB thinks the
window for a series of rate hikes is closing quickly.”
More
European
Central Bank surprises markets with larger-than-expected rate hike (cnbc.com)
Ukraine war must end to
prevent nuclear 'abyss', Lukashenko tells AFP
Thu,
July 21, 2022 at 3:42 PM
Belarus President Alexander
Lukashenko Thursday said Russia, Ukraine and the West must agree to halt the
Ukraine conflict to avoid the "abyss of nuclear war" and insisted
Kyiv should accept Moscow's demands.
"We must stop, reach an
agreement, end this mess, operation and war in Ukraine," Lukashenko,
Russian President Vladimir Putin's top ally, told AFP in an exclusive interview
in Minsk.
"Let's stop and then we will
figure out how to go on living," he said during the one-hour interview at
the Palace of Independence.
"There's no need to go further.
Further lies the abyss of nuclear war. There's no need to go there," he
said, speaking on the 148th day of Moscow's offensive in Ukraine.
Lukashenko accused the West of
seeking a conflict with Russia and of provoking the Ukraine war.
"You have fomented the war and
are continuing it," he said.
"We have seen the reasons for
this war," he added.
"If Russia had not got ahead of
you, members of NATO, you would have organised and struck a blow against
it," he said, echoing Putin.
Belarus has served as a staging
ground for Russia's intervention in Ukraine, but Lukashenko has so far avoided
becoming a party to the conflict.
More
Ukraine war must end to prevent nuclear 'abyss', Lukashenko tells AFP (yahoo.com)
In
other news, there’s real concern over 79 year old President Biden’s health.
Biden tests positive for the coronavirus.
WASHINGTON —
President Biden tested positive on Thursday for the coronavirus, raising health
concerns for the 79-year-old president and underscoring how the virus remains a
persistent threat in a country trying to put the pandemic in the past.
In a statement,
White House press secretary Karine Jean-Pierre said that Mr. Biden “tested
positive for COVID-19. He is fully vaccinated and twice boosted and
experiencing very mild symptoms.”
Mr. Biden is
receiving Paxlovid, an anti-viral drug used to minimize the severity of
Covid-19, Ms. Jean-Pierre said. The president will isolate at the White House
but will “continue to carry out all of his duties fully during that time,” she
said.
Mr. Biden’s
positive test came amid a flurry of virus cases as the nation grapples with new
subvariants that doctors say are highly contagious and more easily evade the
protections provided by coronavirus vaccinations.
More
Biden tests positive for the coronavirus. – DNyuz
Finally,
why just about everyone in the UK needs a little insurance from owning a little
bit of fully paid up physical gold and silver. I suspect this is going to get
much worse before it gets better, if it ever does.
Public
sector borrowing hits £23bn, as debt swallows 96 per cent of GDP
THURSDAY 21 JULY 2022 7:17
AM
Public sector borrowing hit £22.9bn last month, the
second highest-ever June since records began in 1993, according to official
figures.
The figure was some £4.1bn more than June 2021 and
overshot the Office for Budget Responsibility (OBR) forecast by £600m, as the
government seeks to tame rising energy costs, spiralling inflation and inject
cash into the Covid-19 effort, on top of its usual spending.
The public sector’s overall debt has swallowed
around 96.1 per cent of the UK’s GDP, the equivalent of £2,387.6bn, the Office
for National Statistics revealed today.
Central government’s day-to-day spending jumped by
£9bn, to a total of £86bn over in the one-month period.
The nation’s statistics body pointed to an
eyewatering £10.3bn increase in interest on its debt, compared with June of
last year.
Public sector
borrowing hits £23bn, as debt swallows 96 per cent of GDP (cityam.com)
We have gold because we cannot trust
governments.
Herbert Hoover.
Global Inflation/Stagflation Watch.
Given
our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its
own.
The dangerous signs that price rises are here to stay
20
July 2022
As inflation surged to a fresh 40-year high of
9.4pc in June, it may seem times could not get much tougher for the Bank of
England – and its prospects of achieving the 2pc target. Yet under the bonnet
lie dangerous signs that price rises are becoming embedded across the UK.
Price rises in June are even higher than
officials anticipated – and they expect it to get worse, surging to 11pc in
October when the energy price cap jumps again.
Andrew
Bailey, the Bank’s Governor, has raised the prospect of hiking interest rates
by half a percentage point next month,
from 1.25pc to 1.75pc, in the
sharpest increase since the mid-1990s.
Food
and fuel prices, both of which are heavily imported, are big drivers of
the increase. Petrol hit a series of record highs, with the price of filling a
car up more than 42pc compared with June 2021.
There are more reasons
to be worried, however.
If it were only
imported costs leaping, the Bank might hope to be able to “look through” some
of the increase and wait for oil, gas and grain prices in global markets to
stabilise, at which point inflation would fall back.
But there are growing
signs of domestic inflation taking hold.
Prices of
services – which rely more heavily on local factors such as workers’ wages – are also rising uncomfortably quickly.
A hotel stay costs 14pc
more than it did a year ago. While this in part reflects Covid distortions,
that has an ever-lesser impact as restrictions lifted gradually from last
spring. If anything, the jump in prices at the end of lockdown last summer
should be reflected in reduced inflation now, but instead bills keep on rising.
Similarly, restaurants
and cafes charge 7.4pc more than they did in June 2021.
Hospitality was also
wracked by lockdowns, with figures rocked by the Eat Out To Help Out scheme
which kept prices low in August 2020 then sent inflation for diners to 8pc a
year later. Now that subsidy is long gone, normal service should have resumed –
yet prices are accelerating.
Not all of
this reflects the state of the underlying economy, with tax rises in part to blame. Rishi Sunak, the former chancellor, cut VAT on
hospitality amid the pandemic then restored it to 20pc in April. That tax rise
means extra costs and so higher prices in the sector.
Still, increased costs are also seeping into other services.
Hairdressers whacked up
prices when lockdown ended and the public were desperate for a trim. A year
later, a tidy up will set you back 5.4pc more than it did even at the peak of
that burst of pent-up demand.
Finding a mechanic is
getting pricier, too. Servicing and maintaining vehicles costs 6.6pc more now
than a year ago.
Meanwhile, cinema and
theatre ticket prices are up by more than one-sixth. A trip to a museum,
library or zoo is likely to cost more than 5pc more than it did in June 2021.
Attending a sports match will lighten your wallet by almost 10pc more.
Paul Hollingsworth,
chief European economist at BNP Paribas, says this pickup in services prices
means that even if some goods inflation starts to ease, overall pressure on
family finances is here to stay.
“Services prices have
continued to drift away from their long-run trend, and with the labour market
tight and pressure for higher wages strong, we expect little material easing
here in the near term,” he says.
“This, in turn, is likely
to keep inflation expectations elevated too”. High expectations alone can be
self-fulfilling, as businesses raise prices in anticipation of inflation and
workers ask for more pay to help them cope.
As it stands, there are
few signs of these pressures ending soon.
More
The dangerous
signs that price rises are here to stay (msn.com)
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.
With Covid-19 starting to become only endemic,
this section is close to coming to its end.
The
Wuhan 'Disinformation'
by Pete Hoekstra July 20, 2022 at 4:00 am
§ These are startling reversals by both organizations: the
WHO and the Lancet Commission. They have consistently ridiculed and downplayed
the possibility that the virus originated and escaped from a laboratory in
Wuhan, China. Now, nearly three years after COVID-19 began devastating the
world as we knew it, there is just this collective "Oops!"?
§ For two years the WHO, the Lancet and others have been stooges
for the Chinese Communists. It is time to identify them all and hold them
accountable for their grave errors. Their actions probably cost the lives of
millions and have so far allowed China to escape accountability.
§ It seems that while covering for the Chinese Communists
since the beginning of the pandemic, Sachs also decided to absolve them of
accountability, and instead point the finger of responsibility at the U.S.
§ Sachs may have a point, but he is not the one in any
position to deliver more messages. The U.S. Congress must thoroughly
investigate the U.S. government's role and cooperation with China in
biotechnology research, including the coordination between U.S. labs and labs
around the world engaged in further, reportedly even more dangerous types of
research.
- The Chinese government must be held to account
for the Wuhan lab leak, the coverup, hoarding vital medical supplies,
damage to the global economy, and most importantly, the deaths of more
than 6.3 million people worldwide.
More
The Wuhan 'Disinformation' :: Gatestone Institute
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.
All-in-one
solar tower produces jet fuel from CO2, water and sunlight
Loz Blain July 20, 2022
Taking carbon dioxide, water and sunlight as its only inputs,
this solar thermal tower in Spain produces carbon-neutral, sustainable versions
of diesel and jet fuel. Built and tested by researchers at ETH Zurich, it's a
promising clean fuel project.
Fossil fuels can be replaced with batteries or hydrogen in
cars and trucks – but aircraft are trickier. With more than 25,000 commercial
airliners in service today, and service lifetimes around 25 years, airlines are
looking to carbon-neutral fuels to bring down their emissions. It's a
transitional step, but an important one until clean aviation tech is ready and
the entire global fleet can be converted to something else.
Carbon-neutral fuels are drop-in replacements for today's
kerosene Jet-A fuel; they mix in with regular fuel and get burned in jet
engines as per normal, producing the normal amount of carbon emissions. The
difference is that rather than pulling that carbon straight out of the ground,
carbon-neutral fuels grab CO2 from elsewhere; it'll still end
up in the atmosphere, but at least it does some useful work before it gets
there, and every gallon burned is a gallon of conventional fuel that wasn't
burned.
There are a lot of ways to make carbon-neutral fuels – and not all of
those are acceptable for other reasons. Biofuels grown from specially raised
corn crops, for example, create their own emissions, from fertilizers and farm
equipment, and they use land that could otherwise be producing food. Chopping
down forests and using the wood as biomass is also out, for reasons that should
be obvious, but the fact that there are rules in place around this suggests
that even in the sustainability game, there are still bad-faith operators.
----ETH Zurich's
all-in-one carbon-neutral fuel tower
This
pilot plant runs on concentrating solar thermal energy. One hundred and
sixty-nine sun-tracking reflector panels, each presenting three square meters
(~32 sq ft) of surface area, redirect sunlight into a 16-cm (6.3-in) hole in
the solar reactor at the top of the 15-m-tall (49-ft) central tower. This
reactor receives an average of about 2,500 suns' worth of energy – about 50 kW
of solar thermal power.
This
heat is used to drive a two-step thermochemical redox cycle. Water and pure
carbon dioxide are fed in to a ceria-based redox reaction, which converts them
simultaneously into hydrogen and carbon monoxide, or syngas. Because this is
all being done in a single chamber, it's possible to tweak the rates of water
and CO2 to live-manage the exact composition of the syngas.
More
All-in-one solar
tower produces jet fuel from CO2, water and sunlight (newatlas.com)
Another weekend and still Europe’s most
unnecessary, tragic war goes on, with absolutely no one anywhere near power
trying to stop it. Have a great weekend everyone.
Gold is money. Everything else is credit.
J. P. Morgan.
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