Baltic Dry Index. 2081 +14 Brent Crude 105.53
Spot Gold 1730 US 2 Year Yield 3.07 -0.05
Coronavirus
Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 12/07/22 World 561,788,869
Deaths 6,374,783
“For, after all, how do we know that two and two make four? Or
that the force of gravity works? Or that the past is unchangeable? If both the
past and the external world exist only in the mind, and if the mind itself is
controllable – what then?”
George Orwell, 1984.
If the global economy isn’t rolling over from central
bank monetary boom to bust it’s doing a first class job of faking it.
Another day, another day closer to monetary crisis,
debt defaults, and a sudden widespread realisation that we’re all headed to a
Sri Lanka like ending thanks to our central bankster Magic Money Tree forests
delusion since March 2020.
The trouble is, that with trillions of Magic Money
Tree fiat issued since March 2020 having generated the Giant Inflation, there’s
almost nowhere to hide from the coming bust and reset.
Asian stocks at lowest in two years, euro
near par with dollar on growth fears
July
12, 2022 5:41 AM GMT+1
HONG KONG, July 12 (Reuters) - Asian
shares fell on Tuesday, weighed down by the prospect of further monetary policy
tightening by central banks, China's renewed COVID outbreak and Europe’s energy
shortage, which also left the euro a whisker from parity with the safe haven
dollar.
MSCI's broadest index of Asia-Pacific
shares outside Japan (.MIAPJ0000PUS) fell 0.8% to its lowest level in two years,
while Japan's Nikkei (.N225) lost 1.75%.
The euro fell as low as $1.0006 against
the U.S. dollar, moving ever closer to parity for the first time since December
2002, as investors worry an energy crisis will tip the region into a recession.
“Risk-off sentiment is dominating
global markets,” said Yuting Shao, macro strategist at State Street Global
Markets.
"The dollar is the go-to
international reserve currency. So when there is a recessionary risk or there's
pickup of volatility, the greenback is the currency that people rush to because
that is the safest," Shao added.
The dollar index , which tracks the
currency against a basked of six peers rose to 108.47, the highest since
October 2002.
The focus for this week will be macro
data including the Consumer Price Index from the U.S. on Wednesday, and
comments from Federal Reserve Officials as investors look for clues for the
outcome of the Fed's upcoming policy meeting before officials enter the
pre-meet blackout period.
A high inflation reading would add
pressure for the Fed to step up its already aggressive pace of interest rate
increases.
Also high on investors' list of worries
is the fact multiple Chinese cities, including the commercial hub Shanghai are
adopting fresh COVID-19 curbs starting from this week to rein in new infections
after finding a highly-transmissible Omicron subvariant. read
more
Additionally, the surging cost of
energy in Europe is a major fear as the biggest single pipeline carrying
Russian natural gas to Germany entered annual maintenance, with flows expected
to stop for 10 days.
----The yield on benchmark 10-year
Treasury notes was at 2.9668% having dropped back below 3% overnight as
investors bought safe haven Treasuries amid a sell-off on Wall Street.
The three major U.S. stock indexes
ended lower on Monday on investor concerns about rising inflation and corporate
earnings before the start of results season. International equities also
largely fell, as did oil prices and bond yields. read
more
Growth fears were also weighing on oil,
despite concerns about the tight supply.
https://www.reuters.com/markets/europe/global-markets-wrapup-1-2022-07-12/
Chile currency plunge, inflation rattle
Latin America's copper king
July
12, 2022 1:32 AM GMT+1
SANTIAGO,
July 11 (Reuters) - Chile's tumbling currency and runaway inflation are testing
the Andean copper giant's economic and financial systems, and complicating
President Gabriel Boric's plans to push through a tax reform bill to fund
ambitious social programs.
The Chilean
peso has plummeted more than 15% over the last month, briefly hitting 1,000
pesos per dollar for the first time ever, sparking alarms. Yearly inflation hit
12.5% in June, the highest in nearly three decades.
In an
interview with Reuters, Finance Minister Mario Marcel said that the country's
market-orientated model and free-floating exchange rate meant that while the
currency could be more volatile, this didn't necessarily reflect wider strains.
"Because
(Chile) has a floating exchange rate, it is more volatile than other Latin
American countries, but the difference is that we have an economy that is not
dollarized," Marcel said.
"Therefore
exchange rate volatility does not generate risks for financial stability as can
happen in other countries."
Chile's
central bank also sought to calm fears over a weaker peso, stating that it does
not pose a significant harm to the financial system.
"Our
evaluation indicates that up until now, markets have been able to absorb shocks
appropriately," the bank said in a statement issued later on Monday,
adding that it will monitor any further fluctuations.
The global
economy is facing a rising risk of recession, with concerns over slowing demand
from China pulling the global price of copper back sharply from recent highs.
Chile is the world's No. 1 producer of the red metal.
Russia's
invasion of Ukraine has also raised fears over the global supply of grains and
energy, pushing up inflation that is rattling countries around the world as
rising food and gas prices hurt consumers and stoke unrest.
----Young, progressive President Boric
said that the plummeting currency was "tremendously worrying" during
a press conference last week, attributing the decline to weakening copper
prices, as well as uncertainty over a planned new constitution.
"Uncertainty,
without a doubt, plays a role and that's why it's important that all the
different political actors give signals that promote certainty," Boric
told reporters.
Chileans
will vote in September to approve or reject a new constitution, which focuses
on social rights and the environment. It would replace the current market-led
text that dates back decades to the Augusto Pinochet dictatorship. Opinion
polls currently suggest it lacks enough support to pass.
Oil slides as renewed China COVID curbs
temper fuel demand outlook
- Brent, WTI slide over $1/bbl
- Recession fears, China COVID
curbs weigh on oil - analysts
- Supply concerns also ease after
Russian court overturns ruling to suspend Caspian pipeline operations
SINGAPORE,
July 12 (Reuters) - Oil prices fell on Tuesday as fresh COVID-19 curbs in
China, the world's biggest crude importer, and fears of a global economic
slowdown weighed n the fuel demand outlook.
Brent crude
futures for September fell $1.35, or 1.3%, to $105.75 a barrel by 0305 GMT,
while U.S. West Texas Intermediate crude for August delivery was at $102.64 a
barrel, down $1.45, or 1.4%.
"Growing
fears of a recession and continued sluggish demand in China are pulling oil
prices lower, though the current supply-demand balances remain
precarious," analysts from consultancy Eurasia Group said in a note.
more
Global Inflation/Stagflation Watch.
Given our Magic Money Tree central banksters and our spendthrift politicians, inflation now needs an entire section of its own.
Euro-Zone Recession Risk Seen Rising Even as Inflation Peak Near
July
11 2022
The risk of a
euro-area recession is growing as the likelihood of natural gas shortages rises
and inflation remains at record levels, according to economists polled by
Bloomberg.
The probability of an
economic contraction has increased to 45% from 30% in the previous survey and
20% before Russia invaded Ukraine. Germany, one of the most-vulnerable members
of the currency bloc to cutbacks in Russian energy flows, is more likely than
not to see economic output shrink.
“We assume a
recession based on the already implemented oil embargo and the effect of higher
input prices on industry,” said Erik-Jan van Harn, a strategist at Rabobank.
“The German economy is already slowing down and the trend is clearly downward.”
The rising cost of
living is taking an increasing toll on business and consumers who’re emerging
from two years of pandemic. Lower shipments of gas from Russia, meanwhile, pose
a threat to winter energy deliveries.
Inflation forecasts
were raised from the previous poll, though price growth is still expected to
slow to the European Central Bank’s 2% target in 2024. Respondents continue to
see it peaking in the current quarter.
The ECB is expected
to raise its deposit rate to 0.75% by year-end and to 1.25% at its March
meeting. It was previously seen reaching that level only in June.
The euro zone “is
likely to enter a mild recession in the second half of this year, but this
won’t be enough of a drag on demand to return inflation to target, leaving the
ECB on a path of gradual rate hikes,” economists led by James Rossiter at TD
Securities said.
Euro-Zone
Recession Risk Seen Rising Even as Inflation Peak Near - BNN Bloomberg
UK
companies braced for recession as spending slows and costs soar
Retail, leisure and travel groups expected
to be hardest hit after summer
10 July 2022
British
companies are preparing for a recession this year as they face the double hit
of slowing consumer demand and rapidly rising costs from inflation on their own
businesses.
Multiple
companies told the Financial Times they had begun “war gaming” for a recession
in recent weeks, with some adjusting medium-term plans for a period of low or
no economic growth.
Online
used-car seller Cazoo was one of the first to specifically warn over the threat
of recession last month, forcing it to cut hundreds of jobs. Shares in
fast-fashion makers Asos and Boohoo plunged after they revealed a jump in
product returns and warning over the impact of inflation.
Bosses
have said they already see signs of a slowdown, in particular among retailers
given the impact of rising costs on consumers. Electricals retailer Currys cut
its profit forecast this week, while rival AO raised £40mn in what its chief
executive described as a “sensible piece of financial housekeeping given the
short-term macroeconomic uncertainty”.
Stuart
Rose, the former M&S boss and Conservative peer, warned that UK businesses
needed to brace for a difficult period. “Most companies saw inflation coming.
They have strengthened their balance sheets, taken appropriate measures and
will now take the hit on margins. We will get through this.”
One
chief executive of a leading supermarket chain said more people were waiting to
do their monthly shop around pay days. Other shoppers were telling cashiers to
stop at a certain limit — £30 or £40 — to limit expenditure.
More
UK
companies braced for recession as spending slows and costs soar | Financial
Times (ft.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.
Does
BA.5 cause more severe disease than earlier Omicron subvariants?
Rich Haridy July 10, 2022
With the
Omicron subtype BA.5 rapidly becoming dominant in the United States a small
body of research has begun to reveal the unique properties of this novel
SARS-CoV-2 variant. Two recent preprints have described how BA.5 is more
immune-evasive than prior iterations of the virus and how it could lead to more
severe disease.
According
to the latest variant-tracking estimates from the Centers for Disease Control and Prevention
(CDC) the BA.5 Omicron variant accounts for the majority of SARS-CoV-2
infections in the United States. BA.5 has quickly taken over in predominance
from BA.2.12.1, which had briefly ruled over BA.2, following the first Omicron
BA.1.1 wave at the beginning of the year.
Each
iteration of Omicron has displayed substantially distinct mutations, but so far
no subsequent Omicron wave has been as severe as that first sweep across the
world after
its initial emergence in late 2021.
BA.5 however, has triggered a wave of infections and hospitalizations larger
than many countries have experienced in months, and scientists are playing
catch-up to understand the unique characteristics of this new mutation.
What is perhaps most clear
about BA.5 (and its structurally similar sibling BA.4), is this subvariant has
developed the ability to evade pre-existing immunity. One early study,
published in Nature, demonstrated BA.5 can effectively escape antibodies
generated by both vaccine-induced immunity and prior BA.1 infection. More
specifically, the research suggested those vaccinated individuals who
experienced a BA.1 infection early this year may have little immune protection
from a BA.5 infection.
Another recently
published study affirmed t2he
vaccine-escape properties of BA.5. The research, from Columbia University,
found BA.4 and BA.5 were four times more resistant to vaccine-induced
antibodies compared to the original Omicron variant.
“Our study suggests that as
these highly transmissible subvariants continue to expand around the globe,
they will lead to more breakthrough infections in people who are vaccinated and
boosted with currently available mRNA vaccines,” said
David Ho, lead on the study.
More
Does
BA.5 cause more severe disease than earlier Omicron subvariants? (newatlas.com)
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.
No update today. Today, a reminder of
some unintended consequences of fighting the wrong war. Russia “won” the offensive but at what cost
and greatly weakened, lost the war the next year. All sides lost hundreds of
thousands of men and material.
Who actually won anything fighting World
War One? Ukraine?
Brusilov offensive
The Brusilov offensive (Russian: Брусиловский прорыв Brusilovskiĭ proryv,
literally: "Brusilov's breakthrough"), also known as the "June
advance",[6] of
June to September 1916 was the Russian Empire's greatest feat of arms
during World War
I, and among the most lethal offensives in world history. The
historian Graydon Tunstall called the Brusilov offensive the worst crisis of
World War I for Austria-Hungary and
the Triple
Entente's greatest victory, but it came at a tremendous loss of life.[7] The
heavy casualties eliminated the offensive power of the Imperial Russian Army
and contributed to Russia's collapse the next year.
The offensive involved a major Russian attack against the armies
of the Central
Powers on the Eastern Front.
Launched on 4 June 1916, it lasted until late September. It took place in an
area of present-day western Ukraine, in the
general vicinity of the towns of Lviv, Kovel, and Lutsk. The offensive takes its name after the
commander in charge of the Southwestern Front of
the Imperial Russian Army, General Aleksei
Brusilov. The effects of the Brusilov offensive were far reaching, it
helped to relieve the German pressure on Battle of Verdun, also helped to
relive the Austro-Hungarian pressure on the Italians, the Austro-Hungarian
Armed forces were fatally weakened, finally Romania decided to enter the war on
the side of the Allied Forces, however the Russian human and material losses
also greatly contributed to the Russian revolutions.[8]
Background[edit]
Under the terms of their Chantilly Agreement of December 1915,
Russia, France, Britain and Italy committed
to simultaneous attacks against the Central Powers in the summer of 1916.
Russia felt obliged to lend troops to fight in France and Salonika (against
her own wishes), and to attack on the Eastern Front, in the
hope of obtaining munitions from Britain and France.[9]
In March 1916 the Russians initiated the disastrous Lake Naroch offensive in the Vilnius area,
during which the Germans suffered only one-fifth as many casualties as the
Russians. This offensive took place at French request – General Joseph
Joffre had hoped that the Germans would transfer more units
to the East after the Battle of
Verdun began in February 1916.[10]
At a war council held with senior commanders and the Tsar in
April 1916, General Aleksei Brusilov presented a plan to the Stavka (the
Russian high command), proposing a massive offensive by his Southwestern Front
against the Austro-Hungarian forces
in Galicia.
Brusilov's plan aimed to take some of the pressure off French and British armies
in France and the Italian Army along the Isonzo
Front and, if possible, to knock Austria-Hungary out of the war.[11]
Besides the complacency felt by the Germans and
Austro-Hungarians after their successful defense of Russian attacks that winter
and March, the Austro-Hungarians were in the midst of implementing their plans
to knock Italy out of the war. Conrad had
transferred Kövess' troops
from the Balkans and four divisions from the Eastern Front. According to Prit
Buttar, "To make matters worse, many of the experienced divisions
on the Eastern Front were withdrawn and sent to the Alps, and replaced by
formations largely composed of new inexperienced recruits."[12]
More
Brusilov
offensive - Wikipedia
“You are a slow learner, Winston."
"How can I help it? How can I help but see what is in front of my eyes?
Two and two are four."
"Sometimes, Winston. Sometimes they are five. Sometimes they are three.
Sometimes they are all of them at once. You must try harder.
George Orwell 1984.
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