Baltic Dry Index. 1177 -12 Brent Crude 87.51
Spot Gold 1743 US 2 Year Yield 4.48 -0.03
Coronavirus
Cases 02/04/20 World 1,000,000
Deaths 53,100
Coronavirus Cases 22/11/22 World 643,449,808
Deaths 6,627,709
At each step of the transition from commodity to paper to credit, money became more unreal, and
detached from the real goods and services that money can be exchanged for. Money transformed
itself from a mechanism for trade into an object in its own right. Modern technology—digital
money—further stripped money of corporeality. Money exists as pure information, with no
intrinsic value. It is nothing and everything
Satyajit Das. Extreme Money. Masters of the Universe and the Cult of Risk
In the stock casinos, rising alarm.
The FTX fraud fallout seems to keep spreading.
China has more covid cases again, slowing China’s economy returning to normal.
The Fedsters says they may only slow the pace of interest rate hikes ahead, but are not yet ready to bail on fighting inflation.
The possibility of a US nationwide rail strike starting December 5th, got closer yesterday.
The US is trading in a holiday shortened thin week.
What if only the top is in but not the
bottom?
Asia-Pacific
markets mixed as investors weigh risks
UPDATED TUE, NOV 22 2022 12:03 AM EST
Shares in
the Asia-Pacific were mixed on Tuesday as investors weigh risks.
Japan’s Nikkei 225 climbed
0.68% and the Topix added 1.12%. In Australia, the S&P/ASX 200 rose
0.71% ahead of central bank governor Philip Lowe’s speech at the Committee for
Economic Development of Australia.
Hong Kong’s Hang Seng index reversed
early gains to fall 0.39%, with the Hang Seng Tech index down 1.09%. In
mainland China, the Shanghai Composite pared
earlier losses to rise 0.75% and the Shenzhen Component was
flat.
The Kospi in
South Korea slipped 0.38% and the Kosdaq fell 0.62%. MSCI’s broadest index of
Asia-Pacific shares outside Japan was up 0.19%.
On Monday, Chinese banks were reportedly encouraged to increase credit
to support the economy, especially industries that have been hit harder by
Covid. Separately, Chinese local media cited the nation’s securities regulator
as saying the country needs to improve balance sheets of “good quality”
property developers, according to Reuters.
Baidu and Kuaishou are set
to report earnings later Tuesday.
Overnight in the U.S., stocks
closed lower after a volatile session.
Asia-Pacific
markets mixed as investors weigh risks (cnbc.com)
Fed’s Mester
wants more progress on inflation before ending interest rate hikes
Cleveland Federal Reserve President Loretta Mester said
Monday inflation will need to show more signs of progress before she’s ready to
stop advocating for interest rate increases.
While acknowledging that recent
data has been encouraging, the central bank official told CNBC that the
progress is only a start.
“We’re going to have more work to do, because we need to see inflation
really on a sustainable downward path back to 2%,” she said in a live “Closing Bell” interview
with Sara Eisen. “We’ve had
some good news on the inflation front, but we need to see more good news and
sustained good news to make sure that we are returning to price stability as
soon as we can.”
Markets widely expect the Fed in December to
approve its seventh rate hike of the year, but this time slowing down to a 0.5
percentage point increase from a string of four straight 0.75 percentage point
moves.
Mester said she’s on board with the
reduced pace.
“We’re at a point where we’re going
to enter a restrictive stance of policy. At that point, I think it makes sense
that we can slow down a bit the ... pace of increases,” she said. “We’re still
going to raise the funds rate, but we’re at a reasonable point now where we can
be very deliberate in setting monetary policy.”
Multiple other Fed officials in
recent days have
voiced similar sentiments, essentially that the tempo can be slowed
a bit but there’s still a need to continue tightening policy until inflation
shows more signs of a letup.
Markets rallied in recent days following data showing the rate of price
increases slower than estimates, though inflation is still running at a
7.7% annual rate as gauged by the consumer price index. The Fed
targets inflation at 2%.
In recent days, the Fed has faced
some criticism that its focus on inflation could cause
unnecessary damage to the economy. Mester said the Fed is trying to bring down
inflation “as painlessly as possible.”
“I don’t think we should
underestimate the consequences of continued inflation in the long run for the
health of the economy,” she said.
Fed's
Mester wants more progress on inflation before ending interest rate hikes
(cnbc.com)
Global
equity bear market not over yet - Goldman Sachs
November 21, 2022 9:15 AM GMT
Nov 21 (Reuters)
- Goldman Sachs on Monday warned that the global equity bear market is not over
as the markets are yet to see a trough in the momentum of global growth deterioration,
a peak in interest rates and valuations lowered to reflect a likely recession.
The Wall Street
investment bank expects returns to be a "relatively low" 6% through
the end of 2023 as investors focus on the pace of monetary policy tightening and
the consequent hit to growth and earnings.
We continue to
think that the near-term path for equity markets is likely to be volatile and ndown
before reaching a final trough in 2023," Goldman Sachs said in a note.
It expects the
S&P 500 index (.SPX) to be
around the 4,000-points level towards the end of 2023, implying an increase of
less than 1% from current levels, as it sees no earning growth.
Goldman expects
earnings for the constituents in the Pan-European STOXX 600 inndex (.STOXX) to
slide 8% next year, while forecasting a 3% earnings growth for companies in
Japan's TOPIX (.TOPX) and MSCI's Asia-Pacific ex-Japan (.MIAPJ00000JUS) indexes.
The investment
bank expects investors to start to price in expectations for a bull market next
year.
"We expect
markets to transition into a 'Hope' phase of the next bull market at some point
in 2023, but from a lower level."
Global equity bear
market not over yet - Goldman Sachs | Reuters
Investors
flock to short crypto funds, products as negative sentiment deepens -CoinShares
November 21, 2022 8:15 PM GMT
NEW YORK, Nov 21
(Reuters) - Institutional investors rushed to crypto products that bet on price
declines, posting record inflows, as the collapse of digital asset exchange FTX rippled
across the industry and significantly weighed on market sentiment, according to
weekly data from digital asset manager CoinShares released on Monday.
Crypto
products and funds saw inflows of $44 million, as of the week ended Nov. 18,
but 75% of those flows represented investments in short crypto products, data
showed.
The total assets
under management have plunged to $22 billion, the lowest in two years,
CoinShares said.
FTX
filed for bankruptcy protection in the United States more than a week ago in
the highest-profile crypto implosion to date. FTX's downfall came after traders
withdrew $6 billion from the platform in three days and rival exchange Binance
abandoned a rescue deal.
Last week, the
executive hired to steer FTX Group through bankruptcy, John Ray, offered his first findings of improper fund transfers
and poor accounting at the collapsed crypto exchange, describing it as a
"complete failure" of controls.
"Even
for corporate fraud historians, the scope and audacity of FTX's con defies
imagination," said Matt Weller, global head of research, at FOREX.com and
City Index.
More
Investors
flock to short crypto funds, products as negative sentiment deepens -CoinShares
| Reuters
Finally, as the global economy heads into
recession unions in the USA, UK and EU are determined to make the new recession
more of a depression.
Large rail union
SMART-TD votes to reject labor deal as national strike moves closer
SMART-TD, one of the
largest railroad labor unions, voted down a tentative agreement with rail management,
raising the likelihood of a strike in December. The BLET, the other largest
union, voted to ratify the labor deal but said it will honor the picket line.
“It’s now back to the
bargaining table for our operating craft members,” said Jeremy Ferguson,
president of the Sheet Metal, Air, Rail and Transportation
Workers-Transportation Division. “This can all be settled through negotiations
and without a strike. A settlement would be in the best interests of the
workers, the railroads, shippers and the American people.”
“We stood shoulder to
shoulder with our brothers and sisters in SMART-TD and others in rail labor
throughout this process and we will continue to stand in solidarity with them
as we approach the finish line in this round of negotiations,” said Dennis
Pierce, president of BLET, the Brotherhood of Locomotive Engineers and
Trainmen.
The BMWED, the Brotherhood of Maintenance of Way
Employes, is scheduled to strike Dec. 5 with the Brotherhood of Railroad
Signalmen, or BRS. But BMWED announced it would extend its cooling-off period
if one of the larger unions voted not to ratify the tentative labor deal. The
BRS has not indicated whether it will extend its deadline for
talks.
SMART-TD, BMWED and BRS represent
more than 50% of all rail labor.
The rail industry has estimated the impact
of a strike at $2 billion per day. A strike would affect all of
the major rail operators, including Union Pacific, Norfolk Southern and CSX
More
SMART-TD votes down labor deal as rails move closer to national strike (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.
Hopes
grow for inflation relief as German producer prices fall
November
21, 2022
BERLIN (Reuters) -German producer
prices posted their first monthly fall in two and a half years in October,
according to data released on Monday, raising hopes that double-digit inflation
in Europe's largest economy could be nearing its peak.
Producer prices of industrial
products fell 4.2% on the month, due primarily to dips in prices for
electricity and distributed natural gas, the Federal Statistical Office
reported. Analysts polled by Reuters had forecast a rise of 0.9%.
This is likely to be welcome news,
even if only at the margins, for the European Central Bank, which has been
raising rates aggressively to tame price pressures.
Producer price growth has fed into
overall inflation at a faster pace in the past year than normal, so any broader
reversal in pipeline pressures could reinforce expectations for consumer price
growth to peak in the fourth quarter.
But underlying inflation, now around
5%, has shown little sign of easing, and detailed October data released last
week showed broad and mounting price pressures.
"The underlying inflation pressure, using
whichever metric you want to look at, does not show signs of stabilisation - so
there is really nothing for the doves in this reading," Danske Bank
economist Piet Haines Christiansen said.
Commerzbank's Ralph Solveen said the
figures "give cause for hope the inflation rate for consumer prices will
also soon reach its peak. However, this does not mean that the inflation
problem is over."
A survey conducted by the Ifo
economic institute showed that many German businesses were not through with
passing on their soaring costs to customers.
It found that companies had passed on
just 34% of their purchase price increases over the past few months. They plan
to raise this to 50% by April, according to Ifo.
Germany's consumer prices, harmonised
to compare with other European countries, were 11.6% higher year-on-year in
October.
The German government is planning to
introduce gas and electricity price brakes from early next year to curb
inflation, which it expects to reach 8% this year and 7% in 2023.
Compared with October 2021, producer
prices of industrial products rose 34.5% last month, signalling some relief
after maintaining a record pace in August and September of 45.8%.
Hopes grow for
inflation relief as German producer prices fall (msn.com)
Qatar
signs 27-year deal with China as LNG competition heats up
November 21, 2022
11:02 AM GMT
DOHA, Nov 21
(Reuters) - QatarEnergy has signed a 27-year deal to supply China's Sinopec
with liquefied natural gas (LNG), the longest such LNG agreement so far as
volatile markets drive buyers to seek long-term deals.
Following
Russia's invasion of Ukraine in February, competition for LNG has become
intense, with Europe in particular needing vast amounts to help replace Russian
pipeline gas that used to make up almost 40% of the continent's imports.
"Today is an
important milestone for the first sales and purchase agreement (SPA) for North
Field East project, it is 4 million tonnes for 27 years to Sinopec of
China," QatarEnergy chief Saad al-Kaabi told Reuters in Doha, shortly
before the deal signing.
"It
signifies long-term deals are here and important for both seller and
buyer," he said.
The North Field
is part of the world's biggest gas field that Qatar shares with Iran, which
calls its share South Pars.
QatarEnergy
earlier this year signed five deals for North Field East (NFE), the first and
larger of the two-phase North Field expansion plan, which includes six LNG
trains that will ramp up Qatar's liquefaction capacity to 126 million tonnes
per year by 2027 from 77 million.
It later signed
contracts with three partners for North Field South (NFS), the second phase of
the expansion.
Monday's deal,
confirmed by Sinopec, is the first supply deal to be announced for NFE.
---- Kaabi said
negotiations with other buyers in China and Europe that want to have security
of supply were ongoing.
Qatar is already
the world's top LNG exporter and its North Field expansion project will boost
that position and help guarantee long-term supplies of gas to Europe as the
continent seeks alternatives to Russian flows.
"I think the
recent volatility has driven buyers to understand the importance of having
long-term supply that is fixed and that's reasonably priced for the long
term"," Kaabi said.
He said the
pricing of the deal would be similar to others in the past that were linked to
crude oil.
"The way
we're pricing our deals with Asia is crude linked. We've done it this way in
the past and that's the mechanism we're using going forward."
The deal was
signed on an ex-ship basis, meaning QatarEnergy will provide the shipping and
delivery of the LNG.
More
Qatar signs 27-year deal with China as LNG competition heats up | 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
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.
BQ.1.1
Covid-19 Variant Resistant To All Monoclonal Antibody Treatments
Nov 21, 2022,12:58am EST
---- A letter published in The Lancet Infectious Diseases journal on November 18 detailed how many of the
currently spreading Omicron subvariants, namely the BA.4.6, BA.2.75.2, and BJ.1
ones, appear to be resistant to most available monoclonal
antibody treatments. And the BQ.1.1 Omicron subvariant, which has become one of
the two dominant versions of the severe acute respiratory syndrome coronavirus
2 (SARS-CoV-2) in the U.S., seems resistant to all of the
available monoclonal antibody treatments. Yes, all of them.
BQ certainly doesn’t
stand for “be quiet,” as the BQ.1.1 subvariant is now causing a commotion,
being responsible for an estimated 24.2% of all new reported Covid-19 cases
over the past week while the not-too-different BQ.1 subvariant has been the
culprit behind 25.5% of them, according to the Centers for Disease Control and
Prevention (CDC). If you do the
math, that means that these two Omicron subvariants are now comprising over
half of all reported Covid-19 cases, meaning that they have overtaken the BA.5
as the “alpha-dog” of SARS-CoV-2 versions. Therefore, you can probably no
longer rely on any type of monoclonal antibody should you get Covid-19. That’s
certainly bad news for anyone not able to get enough protection from Covid-19
vaccination such as those who have very weak immune systems.
More
BQ.1.1 Covid-19
Variant Resistant To All Monoclonal Antibody Treatments (forbes.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.
A new Skoltech patent:
Defect-free graphene for flexible transparent electronics
November
21st, 2022
Skoltech
researchers have patented a method that
enables producing arbitrarily shaped functional graphene components on a
transparent substrate with 100-nanometer resolution, which hold much promise
for flexible and transparent electronics. The new approach helps avoid defects
that arise during graphene transfer between substrates and strongly affect the
material's quality.
"Flexible
and transparent electronics is typically associated with wearable biosensors
that monitor vital signs, such as heart rate, breathing, and blood oxygenation,
and relay them to a smartphone or fitness band," Skoltech Ph.D. student
Aleksei Shiverskii, one of the inventors, comments. "An affordable and
efficient technology that at first may seem impractical soon becomes a
ubiquitous and indispensable appliance, like a bluetooth electric kettle or a
wifi vacuum cleaner. I believe that someday flexible and transparent electronics
will become a fixture, too."
Currently,
metallic meshes embedded in polymer or glass are used as conductors in flexible
transparent electronics. The most common metals for a mesh are copper, silver,
and even gold or platinum for hi-end devices. However, the metallic meshes that
heat the glass can hardly be called transparent. Although they cope quite well
with their task, the finest mesh only lets through about two-thirds of the
light. As opposed to metallic meshes that you can see with a naked eye,
graphene is more transparent, less visible, and highly conductive. Besides,
some studies show that graphene has higher bending fatigue strength and,
therefore, can last longer.
Importantly,
graphene is made from much cheaper and eco-friendlier materials as compared to
pure metals and, unlike copper or silver, is not susceptible to oxidation.
More
A new Skoltech
patent: Defect-free graphene for flexible transparent electronics
(sciencex.com)
Modern money is inherently worthless,
but everybody accepts it as real.
Paul Seabright, a professor of
economics, identified two traits that underpin
systems of trust including money: the
capacity to weigh up the costs and
benefits of trusting others and the
instinct to return favors in kind or seek
revenge when trust is betrayed. When
it is working well, the system enables
strangers to deal with each other
safely. When the fragile trust fails, people
withdraw their money from banks, and
they seek the refuge of cash. Ironi-
cally, in times of crisis, people
seek paper money that has no intrinsic worth,
illustrating the power of the
monetary illusion.
Satyajit Das. Extreme
Money. Masters of the
Universe and the Cult of Risk
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