Tuesday, 6 September 2022

A World Turning Upside Down.

 Baltic Dry Index. 1133 +47    Brent Crude 95.04

Spot Gold 1715           US 2 Year Yield 3.40 -0.11

Coronavirus Cases 02/04/20 World 1,000,000

Deaths 53,100

Coronavirus Cases 06/09/22 World 610,809,415

Deaths 6,505,244

6 September 1666, after 4 terrible days, the Great Fire of London was finally out.

Great Fire of London

Great Fire of London - Wikipedia

In the Asian stock casinos a half hearted bounce. In Australia, another half percent interest rate hike.

In Europe, more pain from the high price of energy with no real solutions at hand. Printing up more Magic Money Tree fiat money seems to be the favourite solution, with the debate mostly whether to subsidise energy companies or voters.

In the UK later today, a new Prime Minister, same old problems.

In the USA, back from holiday, politics seems to get nastier and more extreme with each passing month. Another interest rat hike is expected on the 22nd.

 

Asia-Pacific markets trade higher; Australian central bank decision ahead

UPDATED MON, SEP 5 2022 11:56 PM EDT

Shares in the Asia-Pacific traded higher on Tuesday ahead of the Reserve Bank of Australia’s rate decision.

Japan’s Nikkei 225 recovered from earlier losses to rise 0.46% and the Topix index gained 0.28%.

The Hang Seng index in Hong Kong advanced 0.56% in early trade, while mainland China’s Shanghai Composite added 0.4%. The Shenzhen Component was fractionally higher.

The Kospi in South Korea rose 0.3% and the Kosdaq gained 0.92%.

In Australia, the S&P/ASX 200 ticked 0.14% higher.

The Reserve Bank of Australia is expected to raise interest rates by a half point to 2.35%, according to a poll by Reuters. The Australian dollar was slightly stronger at $0.6828 in morning trade.

MSCI’s broadest index of Asia-Pacific shares outside of Japan rose 0.44%.

On Monday, the People’s Bank of China announced it would cut the foreign exchange reserve requirement ratio, or the amount of FX reserves that financial institutions must hold, to improve the ability of financial institutions to use foreign exchange funds.

Starting Sept. 15, the RRR will be 6%, down from 8%.

“This cut should help increase FX liquidity and thus lower depreciation pressure for CNY. While the actual impact on FX liquidity is small … this cut serves as a strong policy signal that the PBOC is uncomfortable with the rapid depreciation of the currency,” analysts at Goldman Sachs Economics Research wrote in a note late Monday.

U.S. markets were closed overnight for a holiday.

In oil markets, U.S. crude extended gains from the previous session, while Brent crude declined slightly.

Asia markets: Stocks higher; RBA rate decision ahead (cnbc.com)

 In other news, the EU is running out of weapons to send to Ukraine.

There’s no end in sight to Europe’s energy crisis.

GB gets a new Prime Minister but no one outside of the media cares. Prime Ministers come and go all the time, though this new one comes with low expectations, given most of the energy and foods problems are mostly international rather than domestic.

 

EU warns of depleted weapon stocks; Macron urges French to cut energy use by 10%

UPDATED MON, SEP 5 2022 11:54 PM EDT

French President Emmanuel Macron is urging his country to cut back on energy use amid fresh tensions with Russia over gas supplies.

European markets are feeling the fallout from the war in Ukraine, with the euro falling below 99 cents for the first time in 20 years after Russia said it would shut off its main gas supply pipeline to Europe indefinitely.

On Friday, Russian energy supplier Gazprom said it would not resume its supply of natural gas to Germany through the key Nord Stream 1 pipeline, blaming a malfunctioning turbine.

In Ukraine, President Volodymyr Zelenskyy said the country’s push to liberate Russian-occupied territories in the south is making progress, a week after a much-vaunted counteroffensive began.

Britain’s Ministry of Defense said in its latest intelligence update that Russian forces likely missed several deadlines to capture more of Ukraine’s Donbas, and are now facing a new deadline to capture the region. Ukrainian officials say that Russian troops now have a deadline of Sept. 15 to achieve this, according to the ministry, which sees it as “highly unlikely.”

Russian energy minister Nikolai Shulginov said the country will ship more oil to Asia in response to price caps on its oil exports, Reuters reported.

“Any actions to impose a price cap will lead to deficit on (initiating countries’) own markets and will increase price volatility,” he told reporters at the Eastern Economic Forum in Vladivostok, according to Reuters.

Last week, the G-7 economic powers agreed to cap the price of Russian crude to punish Moscow for its unprovoked invasion of Ukraine. Before the invasion, Russia exported approximately half of its crude and petroleum product exports to Europe, according to the International Energy Agency.

Live updates: Latest news on Russia and the war in Ukraine (cnbc.com)

Opec+ cuts oil supplies to the world as prices fall

September 5, 2022

Opec and allied oil-producing countries, including Russia, have cut their supplies to the global economy by 100,000 barrels per day, underlining their unhappiness with crude prices that have sagged because of recession fears.

The decision on Monday by energy ministers means the cut for October rolls back the mostly symbolic increase of the same amount in September.

The move follows a statement last month from Saudi Arabia’s energy minister that the group could reduce output at any time.

Oil producers such as Saudi Arabia have resisted calls from US President Joe Biden to pump more oil to lower petrol prices and the burden on consumers.

But worries about slumping future demand have helped send prices down from June peaks of over 120 dollars per barrel, cutting into the windfall for the government budgets of Opec+ countries but proving a blessing for drivers as pump prices have eased.

The energy minsters said in a statement the September increase was only for that month, and the group could meet again at any time to address market developments.

Other factors are lurking that could influence the price of oil. For one, the Group of Seven major democracies plan to impose a price cap on imports of Russian oil and what effect that might have on the market. The price level for the cap has not yet been set.

Meanwhile, a deal between Western countries and Iran to limit Tehran’s nuclear programme could ease sanctions and see more than one million barrels of Iranian oil return to the market in coming months.

However, tensions between the US and Iran appear to have risen in recent days: Iran seized two US naval drones in the Red Sea, and US, Kuwaiti and Saudi warplanes flew over the Middle East on Sunday in a show of force.

Oil prices have gyrated in recent months: Recession fears have pushed them down, while worries of a loss of Russian oil because of sanctions over its invasion of Ukraine pushed them up.

Recently, recession fears have taken the upper hand. Economists in Europe are pencilling in a recession at the end of this year due to skyrocketing inflation fed by energy costs, while China’s severe restrictions aimed at halting the spread of the coronavirus have sapped growth in that major world economy.

Opec+ cuts oil supplies to the world as prices fall (msn.com)

 

From anti-Thatcher protests to ‘Reaganomics’: Meet the UK’s new prime minister

LONDON — After a drawn-out Conservative Party leadership contest — and something of a political power vacuum in the U.K. following the resignation of Prime Minister Boris Johnson — the country now has a new leader.

Liz Truss, until now the U.K.’s foreign minister, beat rival Rishi Sunak, the country’s former finance minister, to win the leadership race with the result announced on Monday.

With members of the Conservative Party asked to vote for their favorite candidate, around 57% voted for Truss while 42.6% voted for Sunak.

With a cost-of-living crisis brewing in the U.K., as elsewhere in Europe as inflation continues to rise, Truss will have to hit the ground running to deal with the immediate squeeze on Britons’ pockets, with energy bills forecast to soar in the fall.

Political commentators and economists have been poring over Truss’ political history as well as her economic pledges on the campaign trail for a better idea on where she might take a country that, as well as facing a potential imminent fall in living standards, is yet to find a grip on the economic cost of the Covid-19 pandemic or the fallout from leaving the EU.

CNBC has a whirlwind guide to the U.K.’s new prime minister, with some of the more standout moments in her political career so far.

More

Liz Truss: A guide to the U.K.'s new prime minister (cnbc.com)


Global Inflation/Stagflation/Recession Watch.  

Given our Magic Money Tree central banksters and our spendthrift politicians,  inflation now needs an entire section of its own.

Europe heading for recession as cost of living crisis deepens

September 5, 2022

LONDON (Reuters) - The euro zone is almost certainly entering a recession, with surveys on Monday showing a deepening cost of living crisis and a gloomy outlook that is keeping consumers wary of spending.

While there was some easing of price pressures, according to the surveys, they remained high and the European Central Bank is under pressure as inflation is running at more than four times its 2% target, reaching a record 9.1% last month.

It faces the prospect of raising interest rates aggressively just as the economy enters a downturn.

A rise in borrowing costs would add to the woes of indebted consumers, yet in a Reuters poll last week almost half of the economists surveyed said they expect an unprecedented 75 basis-point rate hike from the ECB this week, while almost as many forecast a 50 bps hike. [ECILT/EU]

Despite those expectations the euro dropped below 99 U.S. cents for the first time in 20 years on Monday after Russia said gas supply down its main pipeline to Europe would stay shut indefinitely. [MKTS/GLOB]

Gas prices on the continent soared as much as 30% on Monday, stoking fears of shortages and reinforcing expectations for a recession and a bitter winter as businesses and households are battered by sky-high energy prices.

S&P Global's final composite Purchasing Managers' Index (PMI), seen as a guide to economic health, fell to an 18-month low of 48.9 in August from July's 49.9, below a preliminary 49.2 estimate. Anything below 50 indicates contraction.

"The PMI surveys signal that the euro area is entering recession earlier than we previously thought, led by its largest economy Germany, and we now see the euro area 'enjoying' a longer, three quarter recession," said Peter Schaffrik at the Royal Bank of Canada.

"The revision is mainly due to developments in energy prices which, even after retreating over recent days, remain elevated and which mean that the impact on household spending will be larger than we hitherto anticipated."

That prospect of recession whacked investor morale in the currency union and it slumped in September to its lowest since May 2020, another survey showed.

Services activity in Germany, Europe's largest economy, contracted for a second month running in August as domestic demand came under pressure from soaring inflation and faltering confidence, earlier figures showed.

More

Europe heading for recession as cost of living crisis deepens (msn.com)

Turkey's inflation hits new 24-year high beyond 80%

ISTANBUL, Sept 5 (Reuters) - Turkey's annual inflation climbed to a fresh 24-year high of 80.21% in August, a bit below expectations according to data on Monday, after the central bank unexpectedly cut interest rates and stoked a nearly year-long cost-of-living crisis.

Inflation has raced higher since last autumn when the central bank gradually cut its policy rate by 500 basis points to 14%, in an unorthodox easing cycle sought by President Tayyip Erdogan that set off a lira crisis.

Despite expectations that inflation will remain lofty, the bank cut rates by another 100 basis points last month to 13%, citing a slowing economy.

Month-on-month, consumer prices rose 1.46%, the Turkish Statistical Institute (TUIK) said, compared to a Reuters poll forecast of 2.0%. Annually, inflation was forecast to be 81.22%.

Last month's reading was the highest since 81.4% inAugust, 1998, when Turkey was battling to end a decade of chronically high inflation.

The domestic producer price index rose 2.41% month-on-month in August for an annual rise of 143.75%.

"The central bank has resumed cutting interest rates. This, and the continuing huge PPI inflation rate, are the main worries for Turkey which are steadily, but surely, eroding the lira's fundamentals," said Commerzbank's Tatha Ghose.

The highest annual inflation was seen in transportation, where prices rose 116.87% year-on-year, despite prices in the sector dropping 1.78% month-on-month. In the key food and non-alcoholic drinks' sector, prices jumped 90.25%.

More

Turkey's inflation hits new 24-year high beyond 80% | Reuters

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

https://www.zerohedge.com/markets/environmental-disaster-ev-battery-metals-crunch-horizon-industry-races-recycle

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. 

App that detects COVID in your voice 'more accurate than lateral flow tests'

5 September, 2022

A mobile phone app can detect COVID in people's voices with "potentially high precision" using artificial intelligence (AI), according to researchers.

An AI model was said to be 89% accurate and is cheap to use, which means it could be adopted in low-income countries where PCR tests are more expensive.

Results can be provided in less than a minute and are said to be a "significant improvement" on the accuracy of lateral flow tests, scientists said.

Infection normally impacts the upper respiratory tract and the vocal cords and so researchers decided to analyse changes in voices using an AI model to detect COVID.

Wafaa Aljbawi, a researcher at the Institute of Data Science at Maastricht University in the Netherlands, said: "These promising results suggest that simple voice recordings and fine-tuned AI algorithms can potentially achieve high precision in determining which patients have COVID-19 infection.

"Such tests can be provided at no cost and are simple to interpret. Moreover, they enable remote, virtual testing and have a turnaround time of less than a minute.

"They could be used, for example, at the entry points for large gatherings, enabling rapid screening of the population."

Data was used from the University of Cambridge's crowd-sourcing COVID19 Sounds app. This included 893 audio samples from 4,352 healthy and non-healthy people.

Users need to give information about their medical history, smoking status and demographics and record some respiratory sounds, such as coughing and reading a short sentence.

A voice analysis technique - called Mel-spectrogram - identified different voice features to "decompose the many properties of the participants' voices".

Ms Aljbawi added: "These results show a significant improvement in the accuracy of diagnosing COVID-19 compared to state-of-the-art tests such as the lateral flow test.

"The lateral flow test has a sensitivity of only 56%, but a higher specificity rate of 99.5%. This is important as it signifies that the lateral flow test is misclassifying infected people as COVID-19 negative more often than our test.

"In other words, with the AI LSTM model, we could miss 11 out of 100 cases who would go on to spread the infection, while the lateral flow test would miss 44 out of 100 cases."

The AI model is also being used for an app to predict exacerbations in chronic obstructive pulmonary disease.

The research is due to be presented to the European Respiratory Society International Congress in Barcelona on Monday.

App that detects COVID in your voice 'more accurate than lateral flow tests' (msn.com)

Next, some vaccine links kindly sent along from a LIR reader in Canada.

NY Times Coronavirus Vaccine Trackerhttps://www.nytimes.com/interactive/2020/science/coronavirus-vaccine-tracker.html

Regulatory Focus COVID-19 vaccine trackerhttps://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.

Today, something a little different, BEV car sales. But will the high price of electricity short circuit sales?

UK new car registrations rise 1.2% in August on battery EV sales

September 5, 2022

(Reuters) - The UK's new car registrations rose 1.2% in August from a year earlier, snapping five-straight months of declines, largely boosted by growth in battery electric vehicles (BEVs), according to industry data released on Monday.

The Society of Motor Manufacturers and Traders (SMMT) said registrations in August, which is considered the second quietest month of the year, were up at 68,858 units from 68,033 units a year earlier, as many buyers choose to wait for a 'new' numberplate in September.

"Spiralling energy costs and inflation on top of sustained supply chain challenges are piling even more pressure on the automotive industry's post-pandemic recovery, and we urgently need the new Prime Minister to tackle these challenges and restore confidence and sustainable growth," SMMT Chief Executive Officer Mike Hawes said.

The auto market has been spiralling with cost-of-living squeeze in Britain and the impact of persisting chip shortages across the globe.

"With September traditionally a bumper time for new car uptake, next month will be the true barometer of industry recovery," Hawes added.

The year-to-date registrations which came in at 983,099 units were, however, down nearly a third from pre-pandemic 2019 and 10.7% lower from 2021.

Sales in BEVs showed a 35.4% increase in volumes and a 14.5% market share. However, SMMT warned that the growth in the segment is slowing, with a year-to-date increase of 48.8%, whereas at the end of first-quarter, BEV registrations had been jumped 101.9%.

UK new car registrations rise 1.2% in August on battery EV sales (msn.com)

September 6, 1916. The First Supermarket Opens.

Piggly Wiggly®, America’s first self-service grocery store, was founded in Memphis, Tennessee in 1916 by the late Clarence Saunders.

Since its founding in 1916, Piggly Wiggly® has played a major role in the history and development of grocery merchandising. Piggly Wiggly’s introduction of self-service grocery shopping revolutionized the grocery industry; many of the conveniences and services that American shoppers now enjoy were brought to them first by Piggly Wiggly®.

History | Piggly Wiggly (thepig.net)

 

 

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