Wednesday, 23 November 2022

Fed Minutes. The FTX Fraud Gets Worse.

 Baltic Dry Index. 1149 -28     Brent Crude 88.26

Spot Gold 1737          US 2 Year Yield 4.47 -0.01

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

Deaths 53,100

Coronavirus Cases 23/11/22 World 643,912,454

Deaths 6,629,186

“But it [the boom] could not last forever even if inflation and credit expansion were to go on endlessly. It would then encounter the barriers which prevent the boundless expansion of circulation credit. It would lead to the crack-up boom and the breakdown of the whole monetary system.”

Ludwig von Mises.

In the stock casinos, fading hopes for a Santa Claus rally. Hope now depends on some miracle good news in today’s release of the Fed’s minutes of their last meeting.

In the real world, winter returns to much of Europe just as LNG supplies and diesel fuel supplies get tight.

An ice age hits most of crypto-land. The FTX fraud gets bigger and bigger. Who’s next to fail?

Americans take off early today for and inflation hit Thanksgiving holiday.

 

New Zealand delivers its biggest rate hike ever; Asia-Pacific stocks mixed ahead of Fed minutes

UPDATED WED, NOV 23 2022 12:30 AM EST

Shares in the Asia-Pacific are mixed Wednesday after U.S. stocks rose overnight and New Zealand’s central bank delivered a 75 basis point hike, the biggest rate hike ever in the central bank’s history.

The NZX 50 index in New Zealand fell 0.92%. The S&P/ASX 200 was up 0.61% despite the Reserve Bank of Australia governor Philip Lowe on Tuesday hinting at more rate hikes ahead.

South Korea’s Kospi rose 0.68%, while the Kosdaq climbed 1.74%. Japanese markets are closed for a public holiday.

Hong Kong’s Hang Seng index traded 0.57% higher. In Mainland China, the Shanghai Composite declined 0.19% and the Shenzhen Component was down 1.22%.

Singapore will release its inflation data, while Australia is expected to post its manufacturing data. Chinese smartphone maker Xiaomi is scheduled to report earnings later in the day.

Cleveland Fed President Loretta Mester also said recent inflation data is promising and that she’d support reduced interest rate hikes going forward.

Asia-Pacific markets: New Zealand interest rate hikes, inflation data (cnbc.com)

 

Stock futures are little changed as investors look ahead to Fed meeting minutes

UPDATED TUE, NOV 22 2022 9:26 PM EST

U.S. stock futures were little changed on Tuesday night, as investors looked ahead to Federal Reserve meeting minutes for clues into the pace of future interest rate hikes.

Dow Jones Industrial Average futures rose by 14 points, or 0.05%. S&P 500 futures gained 0.03%, while Nasdaq 100 futures dipped 0.06%.

Shares of Nordstrom fell more than 8% in extended trading after the department store chain reaffirmed its forecast. However, Nordstrom beat profit and sales expectations in its latest results, according to consensus expectations on Refinitiv.

The Dow Jones Industrial Average rallied nearly 400 points, or about 1.2%, during the regular session Tuesday. The S&P 500 rose 1.36%, closing above the 4,000 level for the first time since September. Meanwhile, the Nasdaq Composite jumped 1.36%.

Investors shrugged off fears of further lockdowns in China after the country reported its first Covid deaths since May. Instead, traders focused on some strong earnings reports, and bet on the likelihood for an easing in monetary policy from the Fed going forward.

“Investor psychology remaining optimistic is driving the rally in this market,” Eugene Profit, CEO at Profit Investments, said Tuesday on CNBC’s “Closing Bell: Overtime.”

“Going into the next Fed meeting, I think the Fed will probably moderate their language a little bit, and I think investors want to remain optimistic, and ignore a lot of headwinds in this market,” he added.

On the economic front, investors will review the latest Fed meeting minutes on Wednesday for insight into the central bank’s approach on monetary policy ahead of the December meeting.

Earlier in November, the central bank approved a fourth consecutive 0.75 percentage point hike that brought rates to their highest level since 2008. Economists are forecasting a half percentage point increase in December, and smaller rate hikes next year.

Additionally, investors will parse through the latest jobless claims data. Economists polled by Dow Jones are forecasting claims of 225,000 for the week ending Nov. 19, a slight increase from the 222,000 initial claims the prior week.

They’re also expecting the latest data on durable goods and new home sales in October. Durable goods in October are expected to have risen 0.5% from the prior month, according to estimates from Dow Jones.

Markets will be closed on Thursday for the Thanksgiving holiday and will close early on Friday.

Stock futures are little changed as investors look ahead to Fed meeting minutes (cnbc.com)

Finally, more crypto disaster to still to come. Will Biden and the Democrats have to return the stolen money? But would a Biden Department of Justice really act against President Biden and the Democrat Party?

 

FTX lawyer calls this case ‘a different sort of animal’ in first bankruptcy hearing

Lawyers for collapsed crypto exchange FTX said in the company’s first bankruptcy hearing on Tuesday that regulators from the Bahamas, where FTX was headquartered, have agreed to consolidate proceedings in Delaware.

FTX’s lawyers, who were brought in by new leadership to handle restructuring, filed an emergency motion last week to secure the move to the U.S. The hearing on Tuesday was the initial step in the resolution of the largest cryptocurrency bankruptcy on record.

“What we are dealing with is a different sort of animal,” said FTX counsel James Bromley. “Unfortunately, the FTX debtors were not particularly well run, and that is an understatement.”

Regarding FTX’s founder, this was an organization that was “effectively run as a personal fiefdom of Sam Bankman-Fried,” an FTX attorney told the court.

FTX lawyers confirmed earlier reports that the Southern District of New York’s Cyber Crimes unit has begun an investigation into the matter. FTX lawyers have also made reference to cyberattacks, suggesting there were multiple attacks beyond the $477 million hack that occurred shortly after the company entered bankruptcy on Nov. 11. In that attack, hackers extracted ether out of FTX wallets.

The central challenge for the new team is “working to bring order to disorder,” Bromley told the court. After introducing his fellow counsel, Bromley dove into what FTX has been doing to understand the complex morass of data and finances left behind by FTX and Bankman-Fried, who was replaced by restructuring expert John Ray III.

Bankman-Fried exercised a level of control over the business that “none of us have ever seen,” Bromley said, referring to the bankruptcy experts and attorneys the company has employed as part of the restucturing process.

FTX had been valued by private investors at $32 billion earlier this year, and Bankman-Fried was making himself out to be an industry savior during the crypto winter.

“The FTX situation is the latest and the largest failure in this space,” Bromley said. “There was effectively a run on the bank, both with respect to the international exchange [...] as well as the U.S. exchange. At the same time that the run on the bank was occurring, there was a leadership crisis [...] The FTX companies were controlled by a very small group of people, led by Mr. Sam-Bankman-Fried. During the run on the bank, Mr. Fried’s leadership frayed, and that led to resignations.”

FTX has just begun to implement “standard” risk and data management practices, he said. As part of the process, lawyers had earlier to approve roughly $1 million in salary expenses for existing FTX employees.

The process is designed to get as much as possible for creditors, Bromley said.

“It is essential that we first maximize the value of the assets we have, whether that means selling assets, selling businesses or restructuring businesses,” he said. “All of that is on the table.”

FTX customers had a global presence, but many were based in tax havens. The largest geographic areas represented included:

  1. Cayman Islands — 22% of registered customers.
  2. U.S. Virgin Islands — 11% of registered customers.
  3. China — 8% of registered customers.

“We will be before you quite quickly with an attempt to sell certain of the business that we understand [...] are self-sufficient and robust [with] interest from others,” Bromley added.

More

FTX lawyer says in first bankruptcy hearing this is different 'animal' (cnbc.com)

 

Crypto Analyst Who Accurately Predicted Bitcoin Collapse Says 'I'm 100% Out Of Market'

November 21, 2022

Popular cryptocurrency analyst ‘Capo of Crypto’ on Twitter said that market capitulation has started and the “coming week is going to be decisive.”

What Happened: Capo tweeted, “I'm 100% out of the market" amid the FTX (CRYPTO: FTT) collapse. This comes as apex crypto Bitcoin (CRYPTO: BTC) dropped 4.21%, trading at $16,010. Ethereum (CRYPTO: ETH) declined as much as 8%, trading at $1,121 in the last 24-hours.

It should be noted that Capo predicted this year’s Bitcoin collapse and said it is likely heading to new bear market lows. 

On Sunday, the trader tweeted that it is “going to be a big week.” The pseudonymous analyst reiterated that “altcoins could drop 40-50% from here.”

Capo believes that the current rally in the crypto market is meant to trap bulls, and a Bitcoin drop to lower levels will happen in the near term. In a Twitter post, he shared how BTC has flipped support at $17,600 into resistance.

Read Next: FTX Owes 50 Biggest Unsecured Creditors $3B, Over 1M Creditors May Be Involved

Crypto Analyst Who Accurately Predicted Bitcoin Collapse Says 'I'm 100% Out Of Market' (msn.com)

Charities funded by Sam Bankman-Fried may be asked to return donations: ‘I had assumed FTX to be a reputable company’

Last Updated: Nov. 21, 2022 at 8:38 p.m. ET First Published: Nov. 21, 2022 at 2:56 p.m. ET

By   Leslie Albrecht

Charities that benefited from Sam Bankman-Fried’s ‘effective altruism’ are facing an ‘unfortunate reality,’ according to one expert

FTX founder Sam Bankman-Fried’s aggressive embrace of “effective altruism” spewed donations at dozens of nonprofits, but now those groups are facing the possibility that they may be asked to give the money back.

The crypto exchange’s collapse and bankruptcy means groups that received funding from FTX’s philanthropic entities could be asked to return that money — a legal move known as a clawback — so FTX’s account holders and creditors can be repaid.

 

“The unfortunate reality is that charities are vulnerable to clawback claims when a funder enters bankruptcy,” said Jason Lilien, a partner at the law firm Loeb & Loeb, LLP, who was speaking generally about nonprofits and clawback claims, not about the FTX case specifically. While there can be some exceptions in certain circumstances, Lilien said, generally speaking, the law does not let nonprofits avoid clawback attempts.

That’s potentially bad news for nonprofits swept up in FTX’s orbit. Bankman-Fried has made charitable giving a central piece of his public image and FTX’s. The company’s website states that it was “founded with the goal of donating to the world’s most effective charities.”

Bankman-Fried has championed “effective altruism,” a philosophy of giving which attempts to make evidence-based decisions about how to do the most good for humanity. FTX reportedly donated 1% of “net fees” to charity and both employees and account holders were encouraged to donate to the FTX Foundation, the company’s philanthropic arm.

 

The leaders of the FTX Foundation’s Future Fund, which launched in February with plans to give out $100 million “to ambitious projects in order to improve humanity’s long-term prospects,” resigned en masse as FTX unraveled. They said in a public post that the fund was halting new donations amid “fundamental questions about the legitimacy and integrity of the business operations that were funding the FTX Foundation and the Future Fund.” Groups that received Future Fund and FTX Foundation grants are now in limbo, waiting to see how the bankruptcy could affect them. 

More

Charities funded by FTX's Sam Bankman-Fried may be asked to return donations - MarketWatch

Digital Currency Group owes $575 million to Genesis Trading's crypto lending arm

Nov 22 (Reuters) - Venture capital company Digital Currency Group, which owns Genesis Trading and cryptocurrency asset manager Grayscale, owes $575 million to Genesis' crypto lending arm, Chief Executive Barry Silbert said in a letter to shareholders on Tuesday afternoon.

Loans from Genesis Global Capital, which suspended customer withdrawals last week, were used to "fund investment opportunities" and repurchase stock from non-employee shareholders, Silbert said in the letter, which was seen by Reuters. That debt is due in May 2023, he added.

Aside from the money owed to Genesis, Digital Currency Group's only debt is a $350 million credit facility from "a small group of lenders" led by investment firm Eldridge, as well as a $1.2 billion claim it filed in July against bankrupt crypto hedge fund Three Arrows Capital. Digital Currency Group (DCG) had assumed that liability from Genesis.

DCG is still on pace to do $800 million in revenue this year, Silbert said.

In suspending redemptions and pausing new loans, Genesis Global Capital cited the "unprecedented market turmoil" that rippled through the market after crypto exchange FTX filed for bankruptcy. At the time, DCG said the halted withdrawals at Genesis had no impact on its operations or subsidiaries.

Silbert also told shareholders he appreciated words of support "along with offers to invest in DCG" and that he would notify investors if the company decides to do a funding round. Genesis is seeking to raise as much as $1 billion, and has approached crypto exchange Binance and asset manager Apollo Global Management for assistance, the Wall Street Journal reported on Monday.

Digital Currency Group owes $575 million to Genesis Trading's crypto lending arm | 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.

Leading gas importer Japan says LNG is sold out until 2026, as energy-squeezed countries battle over dwindling supplies

Zahra Tayeb   Nov 21, 2022, 10:42 AM

Japan, the leading importer of liquefied natural gas, has said supplies of LNG are sold out for the next three years, setting the stage for battle royale between countries fighting to secure deliveries amid a global shortage.

There are no long-term contracts available for LNG shipments before 2026, Japanese companies told the country's trade ministry in a survey published Monday. 

"The LNG procurement environment has changed completely. Procurement can also be said to be in a state of war," they told the ministry.

A dwindling supply of natural gas worldwide has sent countries racing to secure shipments of the key fuel. The squeeze is due to a lack of investment in LNG export projects, according to the trade ministry.

At the same time, European buyers are set to step up their imports of LNG from next year after Moscow cut off pipeline-borne gas flows to the continent in retaliation to Western sanctions. They have already been in "huge competition" with Asian buyers for exports from Qatar to replace the Russian supplies.

"The global 'LNG competition' is likely to heat up further," the ministry said. Japan is the world's top importer of LNG, but China is set to overtake it, according to the IEA.

China, which initially provided Europe with additional supply, has halted LNG shipments to the region to make sure its own households have enough gas for the colder months.

On Monday, QatarEnergy agreed a 27-year deal to provide China's Sinopec with LNG — the longest-term contract ever, Reuters reported.

Europe stands to face shortages in the years ahead, if Russia completely turns off the gas tap, according to Japan's trade ministry. Should that happen, there will be a global shortage of 7.6 million tons of LNG in January 2025, it predicted.

The gap between global LNG demand and supply is expected to ease in 2026, when planned projects in the US and Qatar are expected to come online. 

Until then, given the lack of long-term contracts, importers will be forced to buy natural gas from the spot market at much higher prices. The spot market is currently trading three times higher than long-term contracts, per Bloomberg

Japan Says LNG Sold Out Until 2026 As Countries Battle for Supply (businessinsider.com)

Nov 21, 2022, 10:42

Germany's DB Cargo to increases freight rates up to 45% / Criticism from trade associations

The DB Cargo freight transport division of German national railway operator Deutsche Bahn (Berlin; www.deutschebahn.com) is making a drastic move right before Christmas: as reported by the German news magazine Der Spiegel, the state-owned company is increasing its freight rates for rail transport by up to 45%, citing increased energy costs and inflation.

According to the report, DB Cargo CEO Sigrid Nikutta confirmed the rate increase. However, only customers who pay the list price are to be affected by the price hike. According to reporting information, these customers account for only 0.06% of DB Cargo’s total turnover of EUR 4.5 bn. For customers with framework contracts, the price increase is to be smaller.

Nevertheless, the announcement sparked displeasure within the industry: “Such a pricing policy is absolutely out of the question and sends a completely wrong signal to the market,” said Eric Rehbock, chief executive of the German association for secondary raw materials and waste disposal, bvse (Bonn; www.bvse.de): “At a time when attempts should be made to shift freight transport to rail as much as possible, this price increase is pure poison.”

The BDI (Berlin; 
www.bdi.eu), Germany’s federation of industries, also criticised that the higher prices for transporting goods by rail impede the achievement of climate targets and encourage a shift back to the roads.

Published on 21.11.2022

LOGISTICS: Germany's DB Cargo to increases freight rates up to 45% / Criticism from trade associations | Plasteurope.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

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.  

Today, did big pharma put profits before people? Is big pharma still doing so? The answer to both seems to be yes.

The Truth About Ivermectin

Medical miracle or notorious lynchpin of misinformation?
Nov 21 2022

Ivermectin has been hailed as a “wonder drug” and, according to the UNESCO World Science Report, a critical component of “one of the most triumphant public health campaigns ever waged in the developing world.”

 

However, since the onset of the COVID-19 pandemic, the National Institutes of Health (NIH) and affiliated health authorities have vociferously recommended against ivermectin as a potential treatment for the virus.

 

Though the Food and Drug Administration (FDA) has approved ivermectin for human use in treating conditions caused by parasites, it has also insisted that ivermectin “has not been shown to be safe or effective” when it comes to treating COVID-19.

 

In a social media message that has gone viral, the FDA labeled it as a drug for horses and not fit for human consumption: “You are not a horse. You are not a cow. Seriously, y’all. Stop it.”


The post made headlines and was one of the FDA’s most successful social media campaigns. Yet, research findings seem to contradict the public health organization’s recommendations.

A growing body of research shows that ivermectin is an essential treatment for COVID-19. Many doctors have praised the drug for its broad yet effective antiparasitic, antiviral, antibacterial, anti-inflammatory, anti-cancer, and autophagic properties.


Ivermectin: Antiparasitic Beginnings

Ivermectin made its name through its significant benefits in treating parasitic infections.

In 1973, Satoshi Omura and William C. Campbell, working with the Kitasato Institute in Tokyo, found an unusual type of Streptomyces bacteria in Japanese soil near a golf course.

In laboratory studies, Omura and Campbell discovered that this Streptomyces bacteria could cure mice infected with the roundworm Heligmosomoides polygyrus. Campbell isolated the bacteria’s active compounds, naming them avermectins, and the bacteria was thus called S. avermitilis.

 

Despite decades of searching worldwide, researchers have yet to find another microorganism that can produce avermectin.

 

It was changing one of the bonds of avermectin through a chemical process that produced ivermectin, which was proven successful in treating onchocerciasis and lymphatic filariasis, both of which are debilitating diseases common in the developing world.

More. Much, much, more.

The Truth About Ivermectin (theepochtimes.com)


Pfizer CEO Claims COVID Vaccine Will Be ‘Free for All Americans,’ Critics Push Back

By Jack Phillips  November 21, 2022 Updated: November 21, 2022

Pfizer CEO Albert Bourla said the company’s COVID-19 vaccine will be “free for all Americans” because insurance companies and other groups will pay the cost, although critics have said his claims aren’t true.

“Americans will see no difference,” Bourla told STAT Summit last week. STAT is a health care publication. The vaccine, he added, will “be free for them to get, regardless of the insurance they have.”

However, Bourla did not mention whether uninsured Americans would have to pay for the vaccine. Currently, the federal government is paying Pfizer $30 per dose of the mRNA vaccine and has been distributing it to the public.

The drug giant announced in October that it would raise the price of its vaccine to $130 per dose after the federal government uses up the vials it has purchased and the vaccine goes on the open market in 2023 when the U.S. public health emergency expires.

David Mitchell, co-founder of advocacy group Patients for Affordable Drugs, said in a recent interview that Bourla’s comments were not truthful. Speaking to the Daily Mail, he said that taxpayers, patients, consumers, and others would eventually foot the bill for the vaccine.

Bourla “knows it’s not true,” he said, referring to claims of the vaccine being free. “The vaccine is not going to be free. He is going to charge $120 list price for the vaccine and it will be paid. The questions is who will pay it.”

Bourla’s recent comment at the STAT Summit is “more … pharma double talk,” Mitchell wrote on Twitter. He previously stated that the higher cost of the Pfizer vaccine absorbed by insurance companies will be passed on in the form of higher insurance premiums.

Price Hike

In announcing the price hike, Pfizer executive Angela Lukin said that the firm will expect to quadruple the cost of the COVID-19 vaccine to about $110 to $130 per dose.

“We are confident that the U.S. price point of the COVID-19 vaccine reflects its overall cost effectiveness and ensures the price will not be a barrier for access for patients,” Lukin said in mid-October. Meanwhile, it is currently unclear what kind of access people without health insurance will have to the vaccine

Lukin said she does not expect purchasing of the vaccines to transfer to the private sector until the first quarter of 2023 “at the earliest.” The move is dependent on the government-contracted supply being depleted.

----On Nov. 1, Pfizer raised its forecast on 2022 sales of its COVID-19 vaccine by $2 billion to $34 billion, and stated new deals and drugs in development should help replace future declining vaccine sales and lost revenue from patent expirations. Sales of the Pfizer-BioNTech COVID vaccine are down from pandemic highs as many countries have neared the end of their primary vaccination campaigns.

More

Pfizer CEO Claims COVID Vaccine Will Be ‘Free for All Americans,’ Critics Push Back (theepochtimes.com)

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.

New technique allows circuits to be printed right onto curved surfaces

Ben Coxworth  November 21, 2022

While the field of printable electronics holds a great deal of promise, the printing of circuits onto curved surfaces is still very challenging. A new technique greatly simplifies the process of doing so, potentially allowing for new types of electronic devices.

The procedure was developed at North Carolina State University, by a team led by Yuxuan Liu, Yong Zhu, Brendan O’Connor, Michael Zheng and Jingyan Dong. It addresses two shortcomings of existing techniques for printing circuits onto existing surfaces.

First of all, the conductive inks used in such circuits typically have polymer binding agents added to them, to help them initially stick to the substrate material. Those agents impair conductivity, however, so an extra step is required to remove them once the circuit has been printed.

Additionally, such circuits can usually only be printed directly onto flat surfaces. That's where the new technique comes in.

It begins with the creation of a template, which incorporates a pattern of microchannels – these make up the pattern of the desired circuit. That template is used to create a thin elastomer membrane, in which the same microchannel pattern is reproduced. The flexible membrane is subsequently applied to the curved target surface, channel-side-down.

A liquid solution containing silver nanowires and ethanol – but no binding agent – is then drawn into the membrane by capillary action, filling the cavities formed by the microchannels. After the solution dries, the membrane is removed, leaving behind a functional silver-nanowire circuit that conforms to the contours of the surface.

In proof-of-concept tests performed so far, the scientists have created a contact lens that could be used to measure fluid pressure in the eye; a latex glove with integrated pressure sensors that could give robots or prosthetics a sense of touch; and a flexible transparent electrode that might find use in solar cells or touch-sensitive panels.

"We think this could be scaled up pretty easily, in terms of manufacturing," said Zhu. "We’re open to talking with industries who are interested in exploring this technique’s potential."

A paper on the research was recently published in the journal Science Advances.

Source: North Carolina State University

New technique allows circuits to be printed right onto curved surfaces (newatlas.com)

“Once the principle is admitted that it is the duty of the government to protect the individual against his own foolishness, no serious objections can be advanced against further encroachments.”

Ludwig von Mises.

 

 

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