Baltic Dry Index. 1755 -22 Brent Crude 92.87
Spot Gold 1657 US 2 Year Yield 4.42 -0.08
Coronavirus
Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 26/10/22 World 633,776,588
Deaths 6,585,861
"Deficit spending is simply a
scheme for the 'hidden' confiscation of wealth. Gold stands in the way of this
insidious process. It stands as a protector of property rights."
Alan Greenspan.
Despite all the recent hopium stock casino rallies, to this old dinosaur markets watcher, it looks like hopium just got trumped by renewed inflation and a general public starting to run out of money, credit and savings.
At the very least, persistent inflation and rising interest rates have made consumers more cautious in what they spend their remaining money on.
With the northern hemisphere winter approaching, most of Europe has had lucky break from milder than usual temperatures so far. But what happens if/when a new cold spell arrives?
The coming Christmas retailing season looks like
being critical for many if not most retailers and tech companies. Is it still a
50:50 bet?
Hang Seng
rebounds 2% as Asia markets rise; Australia inflation hits highest in 32 years
UPDATED WED, OCT 26 2022 12:34 AM
EDT
Shares in the Asia-Pacific rose Wednesday as
sentiment overnight improved over the Fed potentially turning less aggressive.
Hong Kong’s Hang Seng index rose
2% after three consecutive negative sessions. The Hang Seng Tech index gained
4%.
In mainland China, the Shanghai Composite added
1.42% and the Shenzhen Component gained
2.329% – shortly after China Securities Regulatory Commission on Tuesday said
it intends to expedite the development of a “regulated, transparent open,
lively and resilient” market.
Australia’s annual consumer price
index reached the highest since December 1990. The S&P/ASX 200 rose
0.12%. The Australian dollar last
stood at $0.6403.
The Nikkei 225 in
Japan rose 1.05%, and the Topix gained 0.86%. South Korea’s Kospi gained
0.91% –MSCI’s broadest index of Asia-Pacific shares outside Japan ticked 1.21%
higher.
India’s market is closed for a
holiday.
---- “Markets
rebounded overnight driven by better earnings reports and speculation that the
monetary policy tightening cycle may be nearing its end,” analysts wrote in an
ANZ Research note, adding that falling consumer confidence and house prices
indicate that tightening policies may be starting to reduce demand.
Hang
Seng rebounds 2%; Australia inflation hits highest in 32 years (cnbc.com)
Stock futures
fall after Alphabet reports earnings miss
UPDATED TUE, OCT 25 2022 8:16 PM EDT
U.S. stock futures fell on Tuesday night after
disappointing third-quarter results from Alphabet marked a foreboding start to
Big Tech earnings this week.
Dow Jones Industrial Average
futures fell by 75 points, or 0.24%. S&P 500 and Nasdaq 100 futures
declined 0.96% and 2.04%, respectively.
Shares of Google-parent Alphabet
dropped more than 6% in extended trading. The online search giant missed
expectations on the top and bottom lines. Alphabet also reported a
decline in YouTube ad revenue, which spurred investors to deliberate the
outlook for other tech companies that rely on ad spending.
“I think we have to take a big
picture perspective and recognize that no one’s really immune in this market,
there is a slowdown in digital ad spend,” Sand Hill Global Advisors’ Brenda
Vingiello said Tuesday on CNBC’s “Closing Bell: Overtime.”
Other mega-cap tech stocks
declined in after hours trading on the back of the report. Shares of Meta
Platforms fell 4.1%, and Amazon slipped 2%.
Meanwhile, Microsoft declined
about 3% after the
tech giant reported weaker-than-expected cloud revenue in its
latest quarterly results, despite beating earnings and revenue estimates.
During the regular session
Tuesday, the Dow Jones Industrial Average advanced 337 points, or about 1.1%.
The S&P 500 rose 1.6%, while the Nasdaq Composite jumped 2.2%. Those gains,
on the back of a drop in bond yields, helped the major averages extend their
rally for a third straight day.
---- Microsoft
shares decline after earnings report
Shares of Microsoft
declined 6.7% after the tech giant reported
weaker-than-expected cloud revenue in its most recent quarter,
and issued quarterly revenue guidance that fell short of expectations. The
company otherwise topped earnings and revenue expectations.
The company’s
Intelligent Cloud business segment generated $20.33 billion in revenue in its most
recent quarter, slightly missing the $20.36 billion forecasted by analysts,
according to consensus estimates from StreetAccount.
The stock is down
roughly 25% this year.
More
Stock
futures fall after Alphabet reports earnings miss (cnbc.com)
Wall
Street bankers in Riyadh renew warnings over world economy
October
25, 2022 10:14 AM GMT+1
RIYADH, Oct 25
(Reuters) - Top Wall Street bankers renewed their warnings about the world
economy on Tuesday amid geopolitical tensions and steep interest rate hikes to
tackle decades-high inflation.
Goldman Sachs
boss David Solomon said economic conditions would "tighten meaningfully
from here" and the U.S. Federal Reserve could hike rates beyond 4.5-4.75%
if it does not see real changes in behaviour.
"If they
don't see real changes – labour is still very, very tight – they're obviously
just playing with the demand side by tightening. But if they don't see real
changes in behaviour, my guess is they'll go further," he said.
Speaking at Saudi
Arabia's flagship investment conference in Riyadh, he said it was difficult to
get out of "embedded inflation" without an economic slowdown.
The process of
unwinding 40 years of "nationalized fixed income markets" is
"disruptive", Solomon added.
JPMorgan Chase
& Co's Chief Executive Jamie Dimon, speaking on the same panel, said the
geopolitical situation was more concerning than a possible recession in the
United States.
Dimon said the
conflict between Russia and Ukraine, and tensions between the United States and
China were more worrisome than a potential U.S. recession.
"There's a lot
of stuff on the horizon which is bad and could – not necessarily – but could
put the U.S. in recession," he said. "But that's not the most
important thing for what we think about. We'll manage right through that. I
would worry much more about the geopolitics in the world today."
Wall Street
bankers in Riyadh renew warnings over world economy | Reuters
World is in its 'first truly global energy
crisis' - IEA's Birol
October
25, 2022 8:03 AM GMT+1
SINGAPORE, Oct 25 (Reuters) -
Tightening markets for liquefied natural gas (LNG) worldwide and major oil producers
cutting supply have put the world in the middle of "the first truly global
energy crisis", the head of the International Energy Agency (IEA) said on
Tuesday.
Rising imports of LNG to Europe amid
the Ukraine crisis and a potential rebound in Chinese appetite for the fuel
will tighten the market as only 20 billion cubic meters of new LNG capacity
will come to market next year, IEA Executive Director Fatih Birol said during
the Singapore International Energy Week.
At the same time the recent decision by
the Organization of the Petroleum Exporting Countries (OPEC) and its allies,
known as OPEC+, to cut 2 million barrels per day (bpd) of output is a
"risky" decision as the IEA sees global oil demand growth of close to
2 million bpd this year, Birol said.
"(It is) especially risky as
several economies around the world are on the brink of a recession, if that we
are talking about the global recession...I found this decision really
unfortunate," he said.
Soaring global prices across a number
of energy sources, including oil, natural gas and coal, are hammering consumers
at the same time they are already dealing with rising food and services
inflation. The high prices and possibility of rationing are potentially
hazardous to European consumers as they prepare to enter the Northern
Hemisphere winter.
Europe may make it through this winter,
though somewhat battered, if the weather remains mild, Birol said.
"Unless we will have an extremely
cold and long winter, unless there will be any surprises in terms of what we
have seen, for example Nordstream pipeline explosion, Europe should go through
this winter with some economic and social bruises," he added.
For oil, consumption is expected to
grow by 1.7 million bpd in 2023 so the world will still need Russian oil to
meet demand, Birol said.
More
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.
Price
of low-cost groceries go up 17% in a year
25
October, 2022
The price of low-cost everyday grocery items has increased
17% in the 12 months to September, data from the Office of National Statistics
(ONS) has shown, more than the average rate of food and drink inflation.
The figures, based on web-scraped
supermarket data for 30 everyday grocery items, showed the cost of items had already
increased 7% in the year up to April.
Some items increased by more than the
17% yearly rate. Vegetable oil has increased 65% in price, pasta 60% and tea
46%.
Over the past year other budget food
items have also increased:
• tea by 46%
• chips by 39%
• bread by 38%
• biscuits by 34%
The increase in low-cost food is
greater than the overall rate of inflation for food and drink that was
released by the ONS last week. That rate stood at 14.5%.
Some items did reduce in price.
The largest price decrease recorded
was fruit orange juice with which fell 9%. Beef mince also fell 7% in price.
While announcing the data, the ONS
cautioned that it had been produced using new, innovative methods and as a
result was less robust than official statistics.
For half of the 30 sampled items
monitored, the average lowest price, across the retailers, increased at a
faster rate than the latest available official consumer price inflation measure
for food and non-alcoholic beverages, the ONS said.
But it added that caution should be
taken when comparing with the official measure of food and drink inflation as
it contains many more than the 30 items used in this analysis and different
methodology.
For example, items may not always be
available instore or online, which is reflected in the data collected, so the
analysis can be sensitive to product availability and the specific products
that are being substituted.
Price of low-cost
groceries go up 17% in a year (msn.com)
Analysis: Decade of central bank largesse
haunts taxpayers as losses loom
October
25, 2022 6:12 AM GMT+1
FRANKFURT, Oct 25 (Reuters) - For more
than a decade since the global financial crisis, central bankers pumped
trillions of dollars of cheap money into the financial system to keep the
economy afloat. Now that largesse is coming back to haunt them - and taxpayers.
Having raised
interest rates to fight runaway inflation, the Federal
Reserve and its Europeanpeers
must make huge interest payments to commercial banks on deposits the
institutions themselves created via massive bond purchases and cheap loans.
The optics of this are dire enough at a
time when millions of citizens struggle with a cost-of-living crisis. Worse, it
means they will have little or no money to pay into the governments' coffers
and some central banks in Europe might even need taxpayer help.
"The central bank continues to
send money to the banks, while we have to cut back on our expenditure,"
Lex Hoogduin, an economics professor at the University of Groningen and a
former board member at the Dutch central bank, said. "So it's mostly a
political issue."
Indeed, calls
are growing to curb
interest payments to banks, much to the dismay of a sector which sees
itself as already having borne the brunt of a decade of low rates.
Among those who want lenders to take
the hit is Michiel Hoogeveen, a Dutch lawmaker on the European Parliament's
economic committee, which oversees the ECB.
"If the taxpayer ends up paying
the bill, that will be very unfair," he told Reuters.
The Bank of England's former deputy
governor Paul Tucker also urged the BoE to cut the interest on part of those
reserves and save 30-45 billion pounds ($84.93 billion) in each of the next two
financial years.
Morgan Stanley estimates that every
percentage point increase in the BoE's rate lowers remittances to the Treasury
by 10 billion pounds per year.
The British government, which received
120 billion pounds in profits from the BoE since 2009, has already earmarked a
transfer of 11 billion pounds for the central bank.
The U.S. Treasury will not need to
worry about bailing out the Fed, which can simply defer any loss. But it will
be missing the $50-100 billion or so that it has been receiving from the
central bank every year since the financial crisis.
This meant Fed chair Jerome Powell was
likely to face heat from lawmakers because funds will instead flow to banks,
many of which are foreign.
"The Fed won’t be bankrupt
financially but it could be politically," said Derek Tang, an economist at
LH Meyer, a research firm.
For none is the problem more acute than
for the ECB, which this week will discuss options to cut its interest bill amid
a
web of political, legal and financial complications.
The central bank of the 19 countries
that share the euro has made a rod for its own back by lending money at
negative rates to banks.
These are now set to make a guaranteed
profit by simply parking that cash back at their national central bank, earning
a 0.75% annual interest rate that is likely to double this week and is seen
rising to 3% next year.
This arbitrage will net banks 31-34.9
billion euros if the rate on deposits peaks between 2.5% and 4.5%, according to
Eric Dor, the director of economic studies at IESEG School of Management in
Paris.
It will contribute to losses of around
40 billion euros for euro zone central banks next year, according to Morgan
Stanley.
More
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.
Please share! This Dangerous Research must
be stopped.
Due to its importance, we will leave this YouTube clip up all week.
New
Boston [SARS] virus Approx. 19 minutes.
[Kills
80 percent of humanised mice.]
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