Thursday, 13 October 2022

Hopium On Inflation. A World Spinning Towards War.

 Baltic Dry Index. 1873 -31    Brent Crude 92.46

Spot Gold 1667         US 2 Year Yield 4.28  -0.02

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

Deaths 53,100

Coronavirus Cases 13/10/22 World 628,347,497

Deaths 6,565,787

The Chancellor believes everything, the Treasury suspect everything, the politicians know everything.

With apologies to Oscar Wilde.

In the stock casinos, fear of today’s US inflation figures, hopium that trouble in the stock casinos will force the Fed to stop raising interest rates sooner rather than later.

Well it is hopium after all. I think rallies, if any occur, are exit rallies, our new bear market in stocks has much further to fall and will last longer than most in the casinos expect.

 

Asia-Pacific markets mixed ahead of U.S. inflation data

UPDATED THU, OCT 13 2022 12:09 AM EDT

Shares in the Asia-Pacific were mixed on Thursday as investors await inflation data from the U.S. due later stateside.

The Nikkei 225 in Japan was 0.5% lower and the Topix was down 0.68%. Toshiba’s stock rose more than 9% after local media Kyodo reported a potential buyout. Japan’s yen strengthened in Asia’s morning after touching 146.98 per dollar.

South Korea’s Kospi shed 1.16% and the Kosdaq lost 2.57%.The Hang Seng index in Hong Kong struggled for direction and last traded 1% lower.

Mainland China’s stocks were up — the Shanghai Composite gained 0.16% and the Shenzhen Component added 0.525%. In Australia, the S&P/ASX 200 traded 0.22% higher.

MSCI’s broadest index of Asia-Pacific shares outside Japan was down 0.48%. Thailand’s market is closed for a holiday Thursday.

Economists expect U.S. consumer prices to have risen 0.3% in September from August, and 8.1% from the same period a year ago. In August, the CPI rose 0.1% from July and 8.3% compared with the year before.

U.S. stocks fell overnight, with the S&P 500 hitting its lowest close since November 2020.

Asia-Pacific markets mixed ahead of U.S. inflation data (cnbc.com)

European stocks head for lower open as investors brace themselves for U.S. inflation data

UPDATED THU, OCT 13 2022 12:26 AM EDT

European markets are heading for a lower open on Thursday as investors around the world prepare themselves for the latest U.S. inflation data.

The negative open in Europe comes amid mixed global sentiment ahead of the latest U.S. inflation reading. U.S. stock futures were up slightly overnight while markets in the Asia-Pacific region were mixed as investors await the data.

Dow Jones’ consensus estimates show the CPI rose 0.3% in September, up from 0.1% in August. That would bring inflation’s annual pace down to 8.1% from 8.3%.

A rise in the consumer price index would also follow producer price data that came in higher than expected, data showed on Wednesday. The U.S.′ producer price index, a gauge of final-demand wholesale prices, was up 0.4% in September, more than the consensus estimate of a 0.2% increase, according to Dow Jones.

Markets digested minutes released Wednesday from the September Federal Reserve meeting which showed the central bank expected to keep hiking interest rates until it sees receding inflation.

One comment made some think the Fed might instead slow the rate hikes, if not roll them back, if the tumult in financial markets continues.

European markets are heading for a lower open on Thursday as investors around the world prepare themselves for the latest U.S. inflation data.

The U.K.’s FTSE index is expected to open 12 points lower at 6,812, the German DAX down 41 points at 12,150, the French CAC 23 points lower at 5,803 and Italy’s FTSE MIB 40 points lower at 20,324, according to data from IG.

The lower open in Europe comes amid mixed global sentiment ahead of the latest U.S. inflation reading. U.S. stock futures were up slightly overnight while markets in the Asia-Pacific region were mixed as investors await the data.

Dow Jones’ consensus estimates show the CPI rose 0.3% in September, up from 0.1% in August. That would bring inflation’s annual pace to 8.1% from 8.3%.

A rise in the consumer price index would also follow producer price data that came in higher than expected, data showed on Wednesday. The U.S.′ producer price index, a gauge of final-demand wholesale prices, was up 0.4% in September, more than the consensus estimate of a 0.2% increase, according to Dow Jones.

European stocks open to close, U.S. inflation data (cnbc.com)

 

Fed officials expect higher rates to stay in place, meeting minutes show

Federal Reserve officials have been surprised at the pace of inflation and indicated at their last meeting that they expect higher interest rates to remain in place until prices come down, according to minutes released Wednesday from the central bank’s September meeting.

In discussions leading up to a 0.75 percentage point rate hike, policymakers noted that inflation is especially taking its toll on lower-income Americans.

They reiterated rate hikes are likely to continue and higher rates will prevail until the problem is showing signs of resolving.

“Participants judged that the Committee needed to move to, and then maintain, a more restrictive policy stance in order to meet the Committee’s legislative mandate to promote maximum employment and price stability,” the meeting summary stated.

Officials further noted that with inflation “showing little sign so far of abating … they had raised their assessment of the path of the federal funds rate that would likely be needed to achieve the Committee’s goals.”

The S&P 500 gained slightly on Wednesday after the release of the minutes as some traders took one comment as a signal the Fed could back off its rapid tightening if there was more financial markets turbulence.

More

Fed minutes October 2022: (cnbc.com)

Treasury yields fall slightly as traders await Thursday’s CPI report

Treasury yields fell slightly Wednesday as investors absorbed stronger-than-expected September’s producer price index inflation figures, and awaited Thursday’s CPI report.

The 2-year Treasury yield was down 2.9 basis points at 4.287% at 4:00 p.m. ET. The benchmark 10-year Treasury yield ticked down 4 basis points to 3.898%.

Yields and prices have an inverted relationship and one basis point is equivalent to 0.01%.

Wholesale prices came in hotter than expected. September’s producer price index data, which measures wholesale prices of goods, rose 0.4%, according to a Wednesday report from the Bureau of Labor Statistics. Excluding food, energy and trade services, PPI increased 0.3%.

Economists surveyed by Dow Jones were expecting headline PPI to add 0.2%.

Investors are also bracing for Thursday’s CPI data as they look for signs on whether the Federal Reserve’s interest rate hikes are working as a measure to throttle persistent inflation.

In recent weeks, Fed speakers have said they are not satisfied with the development of inflation and will not shy away from hiking interest rates further to change this. Concerns that the central bank is dragging the U.S. into a recession have grown louder in response.

More

Treasury yields fall slightly as traders await Thursday's CPI report (cnbc.com)

In other news, nothing good.

 

NYC office market faces ‘real estate apocalypse’

Published Oct. 10, 2022

  • Office valuations in New York City are forecasted to decline by as much as 39% by 2029 due to remote work trends, according to a recent report from professors at the NYU Stern School of Business and Columbia University Business School.
  • That plunge represents a $453 billion valuation drop for New York City office buildings, while similar declines could occur in other U.S. cities, the report noted. What the authors call an “office real estate apocalypse” also will have negative implications for nearby businesses and local public finances.
  • The authors said that lower quality, less expensive office buildings will experience much more volatile swings in valuation, while higher quality office buildings are somewhat buffered against the downward trend.

The COVID-19 pandemic accelerated the push for remote work, which in turn, decreased office space demand. Physical occupancy, or the amount of people working in an office building on any given day, fell from 95% in February 2020 to about 47% last month in major U.S. office markets, according to the report.

In a worrisome sign for office markets, the study estimates the trend toward more remote work likely will persist.

To determine this, the research studied office REITS focused on New York City. The model indicated “office REIT investors believe remote-work practice to be long-lasting,” according to the report. Many U.S. corporations have announced permanent remote or hybrid work arrangements, and several have begun to shrink their physical footprint.

That was the basis for the report’s forecast of valuations dropping 39% by 2029.

More

NYC office market faces ‘real estate apocalypse’ | Construction Dive

Biden administration may block Russian aluminum imports

The Biden administration is weighing restricting imports of Russian aluminum as it charts possible responses to Moscow’s military escalation in Ukraine, a person briefed on the conversations told Reuters.

Such a move, which has not been finalized, would likely boost global prices for the metal used in a wide range of consumer products and could reverse a previous White House stance that such sanctions could wreak havoc on global markets.

“We’re always considering all options,” said a White House official. “There is no movement on this as of now.”

The Treasury and Commerce departments did not immediately respond to requests for comment from Reuters.

The administration’s choices include an outright ban, raising tariffs to levels so punitive they would constitute an effective ban, or sanctioning United Co Rusal International PJSC, the company also known as Rusal that produces Russia’s metal, according to Bloomberg, which first reported the conversations about an aluminum ban earlier on Wednesday.

Rusal, the world’s largest aluminum producer outside China, did not immediately reply to a Reuters’ request for comment.

More

Biden administration may block Russian aluminum imports (cnbc.com)

Europe likely entering another COVID wave, says WHO and ECDC

Oct 12 (Reuters) - Another wave of COVID-19 infections may have begun in Europe as cases begin to tick up across the region, the World Health Organization and European Centre for Disease Prevention and Control (ECDC) said on Wednesday.

"Although we are not where we were one year ago, it is clear that the COVID-19 pandemic is still not over," WHO's Europe director, Hans Kluge, and ECDC's director, Andrea Ammon, said in a joint statement.

"We are unfortunately seeing indicators rising again in Europe, suggesting that another wave of infections has begun."

WHO's region-wise data showed that only Europe recorded a rise in COVID-19 cases in the week ended Oct. 2, clocking an increase of 8% from the prior week.

Public health experts have warned that vaccine fatigue and confusion over available vaccines will likely limit booster uptake in the region. read more

More

Europe likely entering another COVID wave, says WHO and ECDC | 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.

Wholesale prices rose 0.4% in September, more than expected as inflation persists

Wholesale prices rose more than expected in September despite Federal Reserve efforts to control inflation, according to a report Wednesday from the Bureau of Labor Statistics.

The producer price index, a measure of prices that U.S. businesses get for the goods and services they produce, increased 0.4% for the month, compared with the Dow Jones estimate for a 0.2% gain. On a 12-month basis, PPI rose 8.5%, which was a slight deceleration from the 8.7% in August.

Excluding food, energy and trade services, the index increased 0.4% for the month and 5.6% from a year ago, the latter matching the August increase.

Food prices helped boost the increase in goods inflation, with a 1.2% monthly increase. Energy rose 0.7% after posting massive gains the previous two months.

Inflation has been the economy’s biggest issue over the past year as the cost of living is running near its highest level in more than 40 years.

The Fed has responded by raising rates five times this year for a total of 3 percentage points and is widely expected to implement a fourth consecutive 0.75 percentage point increase when it meets again in three weeks.

“Inflationary momentum has built up in the U.S. economy and will persist near-term, keeping the Fed hiking aggressively,” said Bill Adams, chief economist for Comerica Bank.

More

Producer price index September 2022: Wholesale prices rose 0.4% in September (cnbc.com)

Why questions are swirling about who will buy more than $31 trillion of U.S. debt — and at what price

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. 

As Omicron mutates wildly the virus shows first signs of convergent evolution

Rich Haridy  October 09, 2022

Over the last couple of months researchers tracking emerging SARS-CoV-2 variants have started noticing something strange. No one new variant has looked like taking over but instead a variety of different subvariants seemed to be accumulating the same mutations.

These mutations all seemed to be converging in a way to evade our pre-existing immunity, and a striking study recently appeared speculating the virus has the potential to completely escape our current immune responses. As many people around the world return to normality, deeming the pandemic over, these new evolutionary signals suggest we may be done with thinking about COVID but SARS-CoV-2 is most certainly not done with us …

Twitter has been described by some as a town-square, analogous to a massive open space where anyone can offer their two cents on anything. But in practice it’s actually nothing like that. A more apt analogy would be Twitter resembles a massive apartment building filled with countless rooms devoted to conversations between people with shared interests or beliefs.

Inside one small room in the gargantuan Twitter high rise resides a diverse assortment of virologists, infectious disease researchers, epidemiologists, data visualization nerds, and ambitious armchair experts. They all focus on one particular subject – tracking the genetic mutations of SARS-CoV-2.

Wading into the world of Variant Tracking Twitter can be dizzying for the uninitiated. A whirlwind of dense terminology accompany tweets filled with graphs tracking coded mutations and increasingly complicated variant names. Pango lineages, GISAID data, Nextstrain clades.

In September a word started popping up frequently amongst the coded conversations citing RBD mutations in K444T and N460K. That word was "convergence."

For the last two years the evolution of SARS-CoV-2 has been strange, to say the least. Across 2020 experts frequently warned of the potential for this novel coronavirus to mutate, but initially, it remained remarkably unchanged until a trio of variants emerged late in the year.

Alpha, Beta and Gamma all suddenly popped up. Three different lineages, in three different parts of the world. All with relatively similar mutations.

The changes had begun and in 2021 we saw a series of infection waves cross the world, each one driven by a new variant. Alpha leading to Delta leading to Omicron. What was particularly unusual about these successive waves was each subsequent variant was different from the one that preceded it. This wasn’t the case of a single lineage slowly mutating and changing but big evolutionary leaps were taking place, with new lineages coming out of nowhere.

Since Omicron hit in late 2021 and early 2022 the path of the pandemic seems to have changed. Instead of big evolutionary leaps the Omicron lineage has splintered into scores of different subvariants.

More

As Omicron mutates wildly the virus shows first signs of convergent evolution (newatlas.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.

Graphene Battery Market Size: 2022 Share, Size, Trends, Growth And Business Analysis Report

Published: Oct. 12, 2022 at 1:52 a.m. ET

Oct 12, 2022 (The Expresswire) -- Graphene Battery Market Size | 2022 Energy and Power Industry Global Analysis By Covid-19 Impact On,Share, Trends, Merger, Growth, Business, Key Players, Statistics, Competitive Landscape, And Regional Forecast To 2029 is the latest study published by Fortune Business Insights.

Get Sample PDF Brochure:https://www.fortunebusinessinsights.com/enquiry/sample/105711

A detailed analysis of the Graphene Battery Market companies' strategies, with special attention to supply, demand, and import/export consumption (2022-2029). A thorough analysis of numerous segments, including potential, size, development, innovation, sales, and overall growth of significant companies, is covered in the Graphene Battery. A perfect combination of primary data and secondary sources was used to compile and validate the study's quantitative and qualitative market data.

The Graphene Battery Market is expected to increase significantly over the following seven years, exceeding 2022 in terms of revenue, according to this most recent analysis. To estimate the market size for keywords, 2022 has been used as the base year and the forecast period is from 2022 to 2029.

To get a detailed and profound idea about the Graphene Battery market insights, it is very important to create a competitive environment amongst the different key players at different market locations all around the country. All the market players are competing with each other globally in the international markets by implementing various types of strategies such as product launches and upgrades, mergers and acquisitions, partnerships, etc.

More

Graphene Battery Market Size: 2022 Share, Size, Trends, Growth And Business Analysis Report - MarketWatch

It's not whether you win or lose, it's how you place the blame.

Oscar Wilde.

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