Baltic Dry Index. 1114 -19 Brent Crude 91.60
Spot Gold 1715 US 2 Year Yield 3.50 +0.10
Coronavirus
Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 07/09/22 World 611,435,883
Deaths 6,507,344
Russia
will not soon become, if it ever becomes, a second copy of the United States or
England - where liberal values have deep historic roots.
Vladimir Putin.
In the Asian stock casinos, nervous selling. China’s exports badly missed expectations in yet more sign of trouble in the global economy.
US Treasury yields surged higher yesterday, with the one year rising to a 3.61 yield, 0.14 points higher.
The UK got a new Prime Minister and a revamped team at the top. Few expect much improvement, but you never know, politics is ever up and down depending on uncontrollable events.
Germany got no gas from Russia, effectively blowing up Germany’s business model predicated on cheap natural gas from Russia. As paymaster to the EUSSR, at least up until now, it probably blows up the EUSSR too.
All in all interesting times ahead.
Asia-Pacific
markets open lower; China’s trade data misses expectations
UPDATED WED, SEP 7 2022 12:36 AM EDT
Markets in Asia-Pacific traded lower on
Wednesday as investors anticipate the Federal Reserve to give its summary
on current economic conditions, also known as the Beige Book.
China’s exports grew 7.1% in
August from a year earlier, missing estimates of 12.8% forecasted in a Reuters
poll, after growing 18% in July. The offshore Chinese yuan weakened further to
6.99.
The Nikkei 225 in
Japan traded 0.95% lower and the Topix was also 0.77% lower. In mainland China,
the Shanghai Composite pared
earlier losses to gain 0.18% and the Shenzhen Component also
traded 0.79% higher. The Hang Seng index was
1.25% lower and the Hang Seng Tech
Index was
down 1.79%.
In South Korea, the Kospi traded 1.61%
lower, and the S&P/ASX 200 in
Australia was 1.28% lower.
U.S. bond yields surged overnight,
with the 10-year U.S. Treasury yield jumping to its highest level since June.
The rate on the 30-year Treasury closed at its highest level since 2014. Bond
yields move inversely to prices.
Japanese yen weakens
further, inching closer to 145
The Japanese yen
weakened further to 144.35, the weakest since mid-1998 – as the U.S. dollar
index strengthened, hitting
a fresh 24-year peak against the Japanese currency.
The offshore
Chinese yuan also weakened to 6.99, inching closer to the 7 mark, following
weaker-than-expected trade data.
South Korea’s won
also weakened, surpassing the 1,380-level for the first time in more than 13
years.
Nomura cuts its China
GDP forecast — again
Nomura has cut its
forecast for China’s full-year GDP to 2.7%, another downgrade from its previous
2.8% estimate set in August.
The new outlook is
based on Nomura’s analysis that found 12% of China’s GDP is affected by Covid
controls on a weighted basis, up from 5.3% last week.
Several cities
including the tech hub of Shenzhen have tightened Covid controls in the last
few weeks after reporting new local infections. Chengdu has also ordered people
to stay home while authorities conduct mass virus testing.
Asia-Pacific
markets trade lower; China's trade data in August misses expectations
(cnbc.com)
Stock futures are
flat after another day of losses amid a surge in Treasury yields
UPDATED TUE, SEP 6 2022 8:56 PM EDT
Stock futures were little changed Tuesday
evening after the major averages added to weeks of losses amid a jump in bond
yields.
Futures tied to the
Dow Jones Industrial Average were lower by points. S&P 500 futures edged
slightly lower by 0.01% and Nasdaq 100 futures hovered just above the flat
line.
Stocks added to
their three-week slide in regular trading. The Dow fell about 173 points or
0.5%, and the S&P 500 slid 0.4%. The Nasdaq Composite dropped 0.7% to notch
its first seven-day losing streak since 2016.
The moves came amid
a surge in bond yields that saw the 10-year U.S. Treasury yield jump to its
highest level since June. The rate on the 30-year Treasury closed at its
highest level since 2014. Bond yields move inversely to prices.
Investors are split
on how to approach the market entering the first post-Labor Day week in
September, a notoriously cruel month for stocks. All eyes are on the 3,900
level on the S&P 500. Some see the index falling to even lower lows, while
others are optimistic about a year-end rally.
More
Stock
futures are flat after another day of losses amid a surge in Treasury yields
(cnbc.com)
Next, European news. Will Germany drag down the EUSSR economy into a split this winter? Without the great German powerhouse paying for most of the rest of the EU, thanks to cheap Russian oil and gas, which country is going to step into the paymaster’s shoes, if any?
German Factory Orders
Shrank Again in July as Energy Crisis Hits Eurozone Demand
6
September 2022
Investing.com -- The outlook for
Europe's largest economy continued to darken in July, as incoming orders to
German manufacturers fell for the fifth month in six.
Statistics office Destatis said
orders fell 1.1% from June, due to a slump in demand both from domestic
customers, which fell 4.5%, and from the Eurozone, which fell 6.4%. That was
partially offset by a 6.5% increase in orders from outside the single currency
area.
The numbers confirm the downward
trend that European manufacturing has been in since the Russian invasion of
Ukraine in February. This would have been the sixth straight month of declines
in order, had it not been for an upward revision to the May and June data.
Orders, a broadly reliable
forward-looking indicator of activity are now down 13.6% from a year earlier,
as demand cools in response to heightened geopolitical volatility that drove
producer price inflation to over 37% in the year through July.
"Shrinking order books add to
current recession fears," said ING analyst Carsten Brzeski. With surging
energy prices and fading new orders, the outlook for German industry is
anything but rosy."
The numbers come only two days ahead
of the European Central Bank's next policy meeting, where the governing council
will have to balance increasingly clear risks of a recession against a runaway
inflation trend that has repeatedly run ahead of expectations this year.
The euro was undismayed by the numbers, however, rising 0.4% to $0.9946 by
03:00 ET (07:00 GMT).
The numbers were made slightly worse
by volatile big-ticket items, which typically include items such as aircraft
and ships. Stripped of these, orders fell only 0.8%. Another factor weighing on
the numbers was a 23.6% decline in pharmaceuticals orders, albeit after a 10% rise
the previous month.
German Factory
Orders Shrank Again in July as Energy Crisis Hits Eurozone Demand (msn.com)
JP Morgan plans to
move work from Germany to London as blackout fears grow
September
5, 2022
JP Morgan
has drawn up plans to shift work from offices in Germany into the City of
London as finance companies brace for potential blackouts in the EU's biggest
economy.
The Wall
Street bank is preparing a raft of emergency measures so that it can continue
trading if there are power outages this winter following Vladimir Putin's decision to cut off gas
supplies from Russia.
It came as the energy crisis
gripping Europe deepened, with the Kremlin announcing that the crucial Nord
Stream 1 gas pipeline will remain shut until
Western sanctions are eased,
and the Opec-plus cartel of oil exporting countries agreeing to cut
crude output.
The euro fell below
$0.99 for the first time since December 2002, dropping by as much as 0.7pc to
$0.9878 as wholesale gas prices surged and stocks slumped.
Shares were also hit, with
Germany’s benchmark Dax index falling 2.2pc, while France's Cac 40 stock
index dropped 1.2pc. Benchmark European gas prices jumped as much as
35pc.
The market chaos is spurring
finance companies to prepare for the worst. JP Morgan is understood to be
wargaming options such as shifting work from its Frankfurt base to London and
other European offices if Germany is plunged into darkness.
A source added: “Work transfers
could also be to and from any location, not just involving the UK.”
JP Morgan – which moved billions of
dollars of assets from London to Frankfurt in the wake of the Brexit vote –
could also fire up diesel generators at its offices that would allow them to
function for several days without mains power, or tell staff to work from home
to reduce energy consumption.
The plans have been put in place as a
precaution and the bank currently has no intention of activating any of the
measures, it is understood.
----- Brussels is also
considering a European Union-wide tax on electricity generators amid a scramble
to try and curb the cost-of-living crisis, with energy ministers due to discuss
the proposal at a meeting on Friday.
The plan was backed on Monday by
Emmanuel Macron, France’s President, who said he supports a “European mechanism
which we’d ask for from European energy operators whose production costs are
far lower than market sale prices.”
Many wind and solar plant owners are
believed to be making huge profits because wholesale prices have soared but
their costs have not.
In both the EU and the UK, wholesale
electricity prices are tied to the price of gas, even if electricity has been
generated from other, cheaper sources.
Gas prices are ten or more times
higher than long term averages as Russia restricts supplies to Europe, with the
closure of the Nord Stream 1 pipeline to Germany on Friday adding further
pressure.
More
JP Morgan plans to move work from Germany to London as blackout fears grow (msn.com)
Turkey's
Erdogan says 'Europe reaping what it sowed' on energy crisis
September 6, 2022 4:15 PM GMT+1
ISTANBUL, Sept 6
(Reuters) - Turkish President Tayyip Erdogan said on Tuesday that Russia is
cutting natural gas flows to Europe in retaliation for sanctions, adding that
Europe is "reaping what it sowed".
Fears in Europe
have increased over a potentially bleak winter after Russia announced it was
keeping its main gas pipeline to Germany shut.
Russia
indefinitely halted the flows through the Nord Stream 1 pipeline and has cut or
shut down supplies on three of its biggest westward gas pipelines since its invasion
of Ukraine began on Feb. 24. Oil supplies have also been redirected eastwards.
"Europe is
actually reaping what it sowed," Erdogan told reporters in Ankara on
Tuesday, adding that sanctions drove Putin to retaliate using energy supplies.
"Putin is using
all his means and weapons, and the most important of these is natural gas.
Unfortunately - we wouldn't want this but - such a situation is developing in
Europe," Erdogan said.
"I think
Europe will experience serious problems this winter. We do not have such a
problem," he added.
NATO-member
Turkey has sought to strike a balance between Moscow and Kyiv by criticising
Russia's invasion and sending arms to Ukraine, while opposing the Western
sanctions and continuing trade, tourism and investment with Russia.
Turkey, which
has Black Sea borders with both Russia and Ukraine, has said joining sanctions
against Russia would have hurt its already strained economy and argued that it
is focused on mediation efforts.
More
Turkey's Erdogan says 'Europe reaping what it sowed' on energy crisis | Reuters
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.
Swiss
activate safety net for power groups as Axpo seeks help
September 6, 2022 9:09 AM GMT+1
ZURICH, Sept 6
(Reuters) - Switzerland rushed out its financial safety net for the power
sector after Axpo Holding [RIC:RIC:AXPOH.UL] sought and got an emergency 4
billion Swiss franc ($4.08 billion) credit line to secure its liquidity
requirements amid surging energy prices.
It joins Finland,
Germany, Austria and Sweden in offering liquidity guarantees to their utilities
to withstand the ructions on markets as Russia cuts gas flows to Europe in an
economic battle with the West over the war in Ukraine. read more
Swiss Energy
Minister Simonetta Sommaruga told a news conference the government could not
let a "wildfire" engulf crucial power groups exposed to wild swings
in prices that are forcing them to cough up huge collateral for energy deals.
Axpo,
Switzerland's largest producer of renewable energy that generates more than
half of the country's renewable electricity from hydropower, said in a statement on Tuesday it has not used any of the funds yet.
"This credit
line ensures that, should the situation intensify further, Axpo is in a
position to cover the collateral requirements of long-term power supply
contracts concluded with its customers, and continue contributing to
Switzerland's security of energy supply," it said.
The government
had already lined up a safety net worth 10 billion Swiss francs for the
electricity sector, including Alpiq , BKW (BKWB.S) and
Axpo. read more
More
Swiss activate
safety net for power groups as Axpo seeks help | Reuters
France
backs EU windfall tax to ease soaring energy prices
SEPT. 5, 2022 / 2:36 PM
Sept. 5 (UPI) -- French President Emmanuel
Macron announced Monday his
nation will join Germany in supporting a European Union windfall tax on energy
companies' "excessive" profits to rein in soaring gas, coal and oil
prices for consumers.
Macron
told reporters he supports
the levy and hopes the EU
agrees to it, after speaking on the phone with German Chancellor Olaf Scholz.
"We
support a European mechanism which we'd ask for from European energy operators
whose production costs are far lower than market sale prices," Macron said
after his call with Scholz. "This is the approach that France supports,
and it's the approach that France and Germany support."
On Sunday,
Scholz unveiled a $65 billion
package and announced
Germany would impose an energy windfall tax to help households and businesses
"get through this winter" as Russia's war in Ukraine rages on. Scholz
blamed Russia President Vladimir Putin for Germany's high energy prices, saying
Russia "has broken its contract" and was "no longer a reliable
energy supplier." Before the war, Germany had relied on Russia for 55% of
its fossil fuels. That has dropped to 9.5% since February's invasion.
Adding to
the urgency, Russia announced Friday it would shut off gas
flows through the Nord
Stream 1 pipeline
indefinitely. Russia's state energy giant Gazprom said it detected an oil leak
at its Portovaya compressor station. The pipeline supplies Germany and 35% of
Europe. Friday's announcement sent gas prices soaring and pushed the euro to
its weakest level since 2002.
Russia has
used oil and gas as a leveraged point in negotiations over penalties for its
invasion of Ukraine. It had previously threatened to cut off oil exports to
countries that implement a price cap. Gas flows through Nord Stream 1 have
fallen to 20% of their capacity since June.
EU energy
ministers are currently working on a set of emergency energy measures and will
meet this Friday to discuss possible solutions that include capping natural gas
prices, halting power derivatives trading, as well as the special windfall tax.
The windfall tax "is
the most fair and the most effective approach," Macron said. "If such
an approach doesn't happen on a European level, then we will look at it at the
national level."
France backs EU
windfall tax to ease soaring energy prices - UPI.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.
New
Bivalent Covid-19 Boosters: When Should You Get These BA.4, BA.5 Updated
Vaccines
Bruce Y. LeeSep 5, 2022, 01:56pm EDT
In order to stay in sync with the latest
Centers for Disease Control and Prevention (CDC) recommendations, it’s time to
say bye, bye, bye to the original Covid-19 mRNA booster vaccines. Or perhaps
bivalent, bivalent, bivalent. Going forward, bivalent versions of the
Pfizer/BioNTech and Moderna Covid-19 mRNA boosters are what’s going to be
available, replacing the original univalent ones. That’s because on August
31, the U.S. Food and Drug Administration (FDA) officially
announced that they had further amended the
emergency use authorizations (EUAs) for both the Moderna and Pfizer-BioNTech
Covid-19 mRNA vaccines to now include the bivalent formulations of them. And
continuing to get the original univalent Covid-19 mRNA boosters when the
bivalent ones are available would be kind of like continuing to purchase
one-legged pants when two-legged ones are available. That’s because unlike the
original univalent boosters, the bivalent ones give you added protection
against the now circulating Omicron subvariants of the severe acute respiratory
syndrome coronavirus 2 (SARS-CoV-2) such as the BA.5. So when asking for your
next Covid-19 mRNA booster remember the prefix “bi-.”
More
New Bivalent Covid-19 Boosters: When Should You Get These BA.4, BA.5 Updated Vaccines (forbes.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.
A new laser-based chlorination
process to create high doping patterns in graphene
SEPTEMBER
5, 2022
In recent years, electronics and chemical
engineers have devised different chemical doping techniques to control the sign
and concentration of charge carriers in different material samples. Chemical
doping methods essentially entail introducing impurities into materials or
substances to change their electrical properties.
These promising
methods have been successfully applied on several materials including van der
Waals (vdW) materials. VdW materials are structures characterized by strongly
bonded 2D layers, which are bound in the third dimension through weaker
dispersion forces.
Researchers at
University of California, Berkeley (UC Berkeley), the Kavli Energy Nanosciences
Institute, Beijing Institute of Technology, Shenzhen University, Tsinghua
University recently introduced a new tunable and reversible approach to
chemically dope graphene. Their approach, introduced in a paper published
in Nature Electronics, is based on laser-assisted chlorination.
"Conventional
methods based on substitutional doping or surface functionalization result in
the degradation of electrical mobility due to structural disorder, and the
maximum doping density is set by the solubility limit of dopants," Yoonsoo
Rho and his colleagues wrote in their paper. "We show that a reversible
laser-assisted chlorination process can be used to create high doping
concentrations (above 3 × 1013 cm−2) in graphene monolayers
with minimal drops in mobility."
To implement their
approach, Rho and his colleagues used an ultraviolet (UV) nanosecond laser
beam, with a wavelength of λ=213 nm (5.8 eV). They aligned this beam parallel
to the surface of their sample, under a flowing Cl2 gas.
More
A new laser-based
chlorination process to create high doping patterns in graphene
(techxplore.com)
“The
world is a place that’s gone from being flat to round to crooked.”
Mad
Magazine.
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