Baltic Dry Index. 1355 +28 Brent Crude 85.43
Spot Gold 1783 US 2 Year Yield 4.38 -0.10
Coronavirus
Cases 02/04/20 World 1,000,000
Deaths 53,1030
Coronavirus Cases 01/12/22 World 647,989,682
Deaths 6,640,403
Former FTX CEO Sam Bankman-Fried, in possibly the understatement of 2022, said Wednesday, “I’ve had a bad month.”
Fed Chairman Powell capitulated yesterday. In the anti-inflation fight from now on, Volker policies are out, former Fed Chairman Arthur Burns policies are in.
Get
gold and silver now, ahead of the Great Stagflation arriving or even worse, the
Great Nixonian Error of Fiat Money’s FTX moment.
Fed Chair Powell
says smaller interest rate hikes could start in December
WASHINGTON – Federal
Reserve Chairman Jerome Powell confirmed Wednesday that smaller interest rate
increases are likely ahead even as he sees progress in the fight against
inflation as largely inadequate.
Echoing recent
statements from other central bank officials and comments at the November Fed
meeting, Powell said he sees the central bank in position to reduce the size of
rate hikes as soon as next month.
But he cautioned that
monetary policy is likely to stay restrictive for some time until real signs of
progress emerge on inflation.
“Despite some
promising developments, we have a long way to go in restoring price stability,”
Powell said in remarks delivered at the Brookings Institution.
The chairman noted
that policy moves such as interest rate increases and the reduction of the
Fed’s bond holdings generally take time to make their way through the system.
“Thus, it makes sense
to moderate the pace of our rate increases as we approach the level of
restraint that will be sufficient to bring inflation down,” he added. “The time
for moderating the pace of rate increases may come as soon as the December
meeting.”
Wall Street applauded
the remarks. The Dow Jones Industrial Average closed up 737 points, or 2.18%,
to snap a three-session losing streak. Tech stocks fared even better, with the
Nasdaq Composite roaring 4.41% higher.
“The on-the-day
equity market surge is in part a relief rally,” wrote Krishna Guha, head of
global policy and central bank strategy at Evercore ISI. “Many investors feared
the Fed chair would take a max hawkish sledgehammer to the recent easing of
financial conditions ... That overhang has now gone.
“Despite some
promising developments, we have a long way to go in restoring price stability,”
Powell said in remarks delivered at the Brookings Institution.
The chairman noted
that policy moves such as interest rate increases and the reduction of the
Fed’s bond holdings generally take time to make their way through the system.
“Thus, it makes sense
to moderate the pace of our rate increases as we approach the level of
restraint that will be sufficient to bring inflation down,” he added. “The time
for moderating the pace of rate increases may come as soon as the December
meeting.”
Wall Street applauded
the remarks. The Dow Jones Industrial Average closed up 737 points, or 2.18%,
to snap a three-session losing streak. Tech stocks fared even better, with the
Nasdaq Composite roaring 4.41% higher.
“The on-the-day
equity market surge is in part a relief rally,” wrote Krishna Guha, head of
global policy and central bank strategy at Evercore ISI. “Many investors feared
the Fed chair would take a max hawkish sledgehammer to the recent easing of
financial conditions ... That overhang has now gone.
----Powell’s remarks come with some halting signs
that inflation is ebbing and the ultra-tight labor market is loosening.
Earlier this month,
the consumer price index indicated inflation rising but by less than what
economists had estimated. Separate reports Wednesday showed private payroll
growth far lower than expected in November while job openings also declined.
More
Fed
Chair Jerome Powell says smaller rate hikes could come in December (cnbc.com)
Elon Musk says
the Fed must cut rates ‘immediately’ to stop a severe recession
Elon Musk thinks a
recession is coming and worries the Federal Reserve’s attempts to bring down
inflation could make it worse.
In a tweet early
Wednesday, the Tesla CEO and Twitter owner called on the Fed “to cut interest
rates immediately” or risk “amplifying the probability of a severe recession.”
The remarks came in
an exchange with Tesmanian co-founder Vincent Yu in which several others
participated.
Later in the thread, NorthmanTrader founder Sven
Henrich observes that the Fed “stayed too easy for too long totally misreading
inflation and now they’ve tightened aggressively into the highest debt
construct ever without accounting for the lag effects of these rate hikes
risking they’ll be again late to realize the damage done.”
Musk replied,
“Exactly.”
This isn’t the first time Musk has warned of
impending economic doom.
In a similar exchange on Oct. 24,
the world’s richest man estimated a
global recession could last “until the spring ’24,” though he
noted he was “just guessing.” That prediction came amid a slew of economic
warnings from other business executives including Amazon CEO Jeff Bezos, JPMorgan
CEO Jamie Dimon and Goldman
Sachs CEO David Solomon.
More
Elon
Musk says the Fed must cut rates ‘immediately’ to stop a severe recession
(cnbc.com)
Asian
stocks jump after Powell hints at rate hike slowdown
December 1, 2022 2:33
AM GMT
SINGAPORE, Dec 1
(Reuters) - Asian equities jumped on Thursday, while the dollar slid as
investors poured into risky assets after Federal Reserve Chair Jerome Powell
opened the door to a slowdown in the pace of monetary tightening.
In
an eagerly-awaited speech, Powell said the central bank could scale
back the pace of its interest rate hikes "as soon as December," but
cautioned that the fight against inflation was far from over.
Powell's comments
at the Brookings Institution in Washington sent Wall Street equities soaring,
while the U.S. dollar and Treasury yields fell.
MSCI's
broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) jumped 2% in early Asian
trade.
The
index posted its biggest monthly gain in nearly 30 years in November as hopes
for a Fed pivot towards slower rate hikes gathered steam after four consecutive
75-basis-point increases. But the index was still down about 17.5% on the year.
Japan's Nikkei (.N225) opened
1% higher while Australia's S&P/ASX 200 index (.AXJO) rose
0.85%. E-mini futures for the S&P 500 rose 0.20%.
ING
regional head of research Robert Carnell said it will be very hard now for the
Fed to push back against market expectations for a slowdown in rate hikes.
"It
looks as if Fed Chair Powell didn't get the memo to push back against pivot
hopes and keep financial conditions tight before he went to give his
speech," he said.
More
Asian
stocks jump after Powell hints at rate hike slowdown | Reuters
Finally, in crypto-land, Bitcoin is “artificially propped up” says the ECB! Who knew?
Bankrupt
BlockFi tries the Sheriff of Nottingham approach with SBF over Robinhood.
ECB
says Bitcoin is artificially propped up, shouldn't be legitimised
November 30, 2022
FRANKFURT
(Reuters) -Bitcoin is being artificially propped up and should not be
legitimised by regulators or financial companies as it heads for
"irrelevance", the European Central Bank said on Wednesday.
Bitcoin and
other cryptocurrencies have been variously presented as an alternative form of
money and a shield from the inflationary policies pursued by major central
banks such as the ECB in recent years.
But a 75% fall
over the past year, just as inflation reared its head, and a string of scandals
including the collapse of the FTX exchange this month has given critics among
central bankers and regulators ammunition to fight back.
The value of
bitcoin peaked at nearly US$69,000 in November 2021 before falling to around
US$17,000 by mid-June 2022, where it is still hovering now.
In a blog post
using unusually scathing language, the ECB said bitcoin's recent stabilisation
was "an artificially induced last gasp before the road to
irrelevance".
"Big
bitcoin investors have the strongest incentives to keep the euphoria
going," authors Ulrich Bindseil and Juergen Schaaf wrote. "At the end
of 2020, isolated companies began to promote bitcoin at corporate expense. Some
venture capital firms are also still investing heavily."
They said VC
investments in the crypto and blockchain industry totalled $17.9 billion as of
mid-July but did not provide evidence of price manipulation.
Regulators all
over the world are drafting rules for the crypto world, a complex ecosystem
that ranges from stablecoins supposedly backed by conventional currencies to
forms of lending that happen on the blockchain, or distributed ledger, that
underpins those coins.
The ECB blog
said regulation could be "misunderstood for approval".
"Since
Bitcoin appears to be neither suitable as a payment system nor as a form of
investment, it should be treated as neither in regulatory terms and thus should
not be legitimised," Bindseil and Schaaf said.
They added the
involvement of asset managers, payment service providers, insurers and banks
with crypto "suggests to small investors that investments in bitcoin are
sound".
"The
financial industry should be wary of the long-term damage of promoting bitcoin
investments - despite short-term profits they could make," the authors of
the blog said.
More
ECB
says Bitcoin is artificially propped up, shouldn't be legitimised (msn.com)
Bankrupt crypto lender BlockFi sues Sam Bankman-Fried over shares in trading app Robinhood
29
November 2022
Sam Bankman-Fried, the founder of collapsed cryptocurrency business FTX, is being sued by another bankrupt crypto business over control of a £400m stake in Robinhood.
Lawyers
acting for BlockFi, which filed for bankruptcy earlier this week, claim Mr
Bankman-Fried pledged shares in Robinhood as collateral for a loan that he
subsequently failed to pay, which contributed to BlockFi's collapse.
The two sides are battling over control of the
shares as the escalating fallout from FTX’s collapse triggers a wave of
litigation.
Legal proceedings, revealed in a Delaware
bankruptcy court this week, shed light on how interconnected many leading cryptocurrency
companies are behind the scenes, with a complex web of loans and collateral.
At the heart of BlockFi’s case against Mr Bankman-Fried are shares he held in Robinhood, a Nasdaq-listed
share trading app valued at $8bn.
Mr Bankman-Fried acquired a 7.6pc stake in
Robinhood in May at a time when the stock was trading at an all-time low. The
company’s share price soared 25pc when Mr Bankman-Fried’s investment became
public knowledge.
The 30-year-old allegedly then pledged his
Robinhood shares as collateral to secure a loan from BlockFi, which was once
valued at $3bn.
Mr Bankman-Fried allegedly planned to use the
loan to prop up FTX.
However, FTX crashed into
bankruptcy on Nov 11 with an $8bn hole in its balance sheet after public
concerns were raised about its financial health.
More
Bankrupt crypto lender BlockFi sues Sam Bankman-Fried
over shares in trading app Robinhood (msn.com)
Broke and down to
one credit card: Former FTX CEO Sam Bankman-Fried claims he committed no fraud
Former FTX CEO Sam Bankman-Fried, in possibly the
understatement of 2022, said Wednesday, “I’ve had a bad month.”
The former billionaire added that
he “didn’t do a good job” at upholding his responsibilities to regulators,
customers, and investors in a hotly anticipated conversation with CNBC’s Andrew
Ross Sorkin at the Dealbook Summit.
Bankman-Fried’s
FTX imploded in mid-November after Coindesk reported
irregularities in the company’s balance sheets. The company filed
for Chapter 11 bankruptcy protection in Delaware on Nov. 11.
“I didn’t ever try to
commit fraud on anyone,” Bankman-Fried said. “I saw it as a thriving business and
I was shocked by what happened this month.”
The political
mega-donor said he was down to $100,000 and had one working credit card left.
“We completely failed
on risk,” Bankman-Fried continued. “That feels pretty embarrassing, in
retrospect.”
Bankman-Fried
appeared by video feed from the Bahamas, Sorkin said. “I’ve been in the Bahamas
for the last year,” Bankman-Fried said when asked about why he remained in the
island nation.
Sorkin asked
Bankman-Fried what motivated his acquisitions in the crypto industry, given the
size of Alameda’s borrowing from companies Bankman-Fried intended to acquire.
Bankman-Fried claimed
that he believed that by the middle of 2022, Alameda had repaid all lines of
credit to various borrowing desks. But Alameda still owes BlockFi over $670
million, according to court filings.
“What are your
lawyers telling you right now? Are they suggesting it’s a good idea for you to
be speaking?” Sorkin asked the former billionaire.
“No, they’re very
much not.”
“The time that I
really knew there was a problem was November 6,” Bankman-Fried said, after
Alameda’s sizable FTT position was exposed by Coindesk. “When we looked at
that, there was a potential serious problem.”
“Alameda had taken a
huge hit” by that point. “We were seeing a run on the bank start,”
Bankman-Fried said.
“I was nervous [when]
the Alameda balance sheet” was exposed by Coindesk, Bankman-Fried said, but
expected the damage was going to be limited to Alameda, not an “existential”
crisis for FTX.
More
FTX CEO Sam Bankman-Fried denies crypto exchange fraud (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.
Hmm.
Gold anyone?
ECB warns of losses as it pays price for decade of money printing
November 29, 2022
FRANKFURT (Reuters) - The European Central Bank warned on Tuesday that it might make a loss as high inflation forces it to raise interest rates and foot the bill of a decade of aggressive money printing.
Having raised interest rates to fight
runaway prices, the ECB must make huge interest payments to commercial banks on
some 5 trillion euros worth of deposits it created via massive bond purchases
and cheap loans.
Those stimulus tools, deployed over
several years when inflation was too low, were now likely to push the ECB and
some of its shareholders, such as the central banks of Germany, the Netherlands
and Belgium, into the red.
This might eventually force some of
these central banks to seek a bailout that would raise questions about their
independence and raise the ire of taxpayers.
"We have to fight (inflation) by
raising interest rates, which results in higher interest expenses that we pay
to banks," the ECB said in on its website on Tuesday. "In this case
our profit falls, and we might even make losses."
Ironically, the central banks of the
most fiscally prudent countries will be the hardest-hit because they warehouse
a larger share of bank deposits and the bonds they bought on the ECB's behalf
yield zero or less.
The Dutch national central bank has openly acknowledged the risk that it might need a recapitalisation by its government, though finance minister Sigrid Kaag later cautioned this was "not yet on the table".
The ECB, which is mostly owned by the
national central banks of the 19 countries that have adopted the euro and
accounts for 8% of the balance sheet of that so called Eurosystem, said it had
other lines of defense.
On top of depleting its provisions,
it might tap any income that national central banks make on their monetary
policy operations - such as bonds and loans.
And it may defer any remaining loss
by writing it on its balance sheet as a claim against future profits - a
possibility also cited by the Bundesbank last week.
"Ultimately, the return to a
positive interest rate environment supports Eurosystem profitability in the
medium term," the ECB said.
Central banks can generally function
even if they make losses that deplete all of their capital - as has happened in
recent decades in a number of countries including Germany.
Yet ECB doctrine says it should
remain well capitalised to protect its independence from governments and its
credibility as an inflation fighter.
And euro zone governments have greatly
benefitted from the ECB's easy policy, both via lower borrowing costs and via
dividends paid by their national central banks, meaning that they could be
expected to give some money back.
"It is important to remember that central
banks are not like ordinary companies: they can lose money and still operate
effectively," the ECB said. "Still, the principle of financial
independence implies that national central banks should ultimately always be
sufficiently capitalised."
ECB warns of
losses as it pays price for decade of money printing (msn.com)
Eurozone
inflation drops for first time since mid 2021 and may have ‘passed its peak’
WEDNESDAY 30 NOVEMBER 2022 10:47 AM
Inflation in Europe fell for the first time since
mid 2021 and may have passed its peak, fresh figures out today reveal.
Prices across the 19 countries using the euro
climbed 10 per cent over the year to November, down from a rate of 10.6 per
cent in October, according to Eurostat.
The drop was larger than analysts expected, raising
expectations that the European Central Bank (ECB) could slow its aggressive
interest rate hike cycle.
Before the figures were released, most experts were
pencilling in a third successive 75 basis point rate rise at the ECB’s meeting
next month.
However, softening price pressures “supports ECB
doves’ calls for a slower pace of rate hikes going forward,” Melanie Debono,
senior Europe economist at Pantheon Macroeconomics, said.
President Christine Lagarde and the rest of the
ECB’s governing council have been forced to pivot from years of ultra
stimulative policy to tightening financial conditions due to inflation hitting
record highs this year.
Until this year, interest rates in Europe had been
negative since 2013. The ECB signed off its first rate rise since 2011 in the
summer and has lifted borrowing costs 75 basis points two times in a row.
That aggressive hiking campaign has been mirrored
by the US Federal Reserve and Bank of England, who also have been jolted into
reshaping policy by soaring prices. The ECB has lagged behind the pair, with the Bank moving
fastest by launching its first rate rise in December 2021.
Analysts reckon the eurozone economy will suffer a
tough recession over the next year, driven by rising energy caused by Russia’s
invasion of Ukraine prices cooling business activity.
Europe, particularly Germany and Italy, have for
years relied on cheap Kremlin gas to power its economy.
More
Eurozone inflation drops for first time since mid 2021 (cityam.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.
China
softens tone on COVID severity after protests
December 1, 2022 5:32
AM GMT
BEIJING, Dec 1
(Reuters) - China is softening its tone on the severity of COVID-19 and easing
some coronavirus restrictions even as its daily case toll hovers near record
highs, after anger over the world's toughest curbs fuelled protests across the
country.
Several
cities in the world's second-largest economy, while still reporting new
infections, are breaking with practice by lifting district lockdowns and
allowing businesses to reopen.
Health
authorities announcing the relaxation of measures did not mention the protests,
which ranged from candle-lit vigils in Beijing to clashes with the police on
the streets of Guangzhou on Tuesday and at an iPhone factory in Zhengzhou last
week.
The
demonstrations marked the biggest show of civil disobedience in mainland China
since President Xi Jinping took power a decade ago and come as the economy is
set to enter a new era of much slower growth than seen in decades.
Despite
near-record case numbers, Vice Premier Sun Chunlan, who oversees COVID efforts,
said the virus's ability to cause disease was weakening, state media reported.
"The
country is facing a new situation and new tasks in epidemic prevention and
control as the pathogenicity of the Omicron virus weakens, more people are
vaccinated and experience in containing the virus is accumulated," Sun
said in comments reported in state media.
Sun also urged
further "optimisation" of testing, treatment and quarantine policies.
The
mention of a weakening pathogenicity contrasts with earlier messages from
authorities about the deadliness of the virus.
More
China
softens tone on COVID severity after protests | Reuters
Slew of Unusual Adverse Events
Becoming More Common After COVID Vaccine Rollout
Nov 27 2022
If we go to a doctor or
clinic for a vaccination, be it an influenza shot or a COVID-19 vaccine, we go
with the expectation that it is safe.
We usually dismiss mild symptoms,
such as headaches, fever, pain, and redness at the injection site, since we are
typically informed of them beforehand and expect them to be transient in
duration. Thankfully, most of the time, people recover from them and proceed
with their lives as before.
However, since the rollout of
COVID-19 vaccines, a significant proportion of vaccinated people have
experienced many unusual adverse events. Doctors are raising concerns. Public health officials and vaccine manufacturers are also addressing the high
incidence of blood clots, myocarditis, pericarditis, and menstrual
irregularities.
Yet, there are thousands more
documented health conditions reported to the U.S. Vaccine Adverse Event Reporting System (VAERS)—some
appearing very frequently—that have not yet been given the same level of
attention.
Since their rollout, COVID-19 vaccines have prompted more VAERS adverse event reports than all VAERS reports made in the previous 30 years, comprising over 55 percent of vaccine injury and death reports. These reports have thousands of different adverse event labels.
Although nearly 1.5 million
COVID-19 vaccine injury and death reports have been made to VAERS, studies say
the true number of adverse reactions is many times higher. The 2005–2009
HHS-funded Harvard Pilgrim study found that less than 1 percent
of adverse events following 1.4 million vaccines administered were reported to
VAERS; several independent analysts estimate that only 2.5 percent of COVID
vaccine adverse reactions are reported to VAERS.
The system is also notorious for
its redundancy: injection site swelling, vaccine site swelling, and swelling
are recorded as separate events, and a person reporting to the system may
select one or all three events.
Another study found
that more serious adverse events are more likely to be reported.
This article examines several
now-common adverse events following COVID vaccination. The figures are from the
most recent update on Nov. 18, 2022
More
Slew of Unusual
Adverse Events Becoming More Common After COVID Vaccine Rollout
(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.
Self-driving lorries hit the
road in Sweden
Issued on: 30/11/2022 - 07:44
Sodertalje (Sweden) (AFP) – Barrelling down a motorway south of
Stockholm in a 40-tonne lorry and trailer, the driver keeps a careful eye on
the road but, jarringly, no hands on the wheel.
Instead, the truck drives itself, and
veteran driver Roger Nordqvist is at the ready only in case of unexpected
problems.
Swedish truck maker Scania is not the
only auto manufacturer developing autonomous vehicles, but it recently became
the first in Europe to pilot them while delivering commercial goods.
"We take their goods from point A,
drive them to point B, fully autonomously," Peter Hafmar, head of
autonomous solutions at Scania, tells AFP outside the company's transport lab
in Sodertalje, south of Stockholm.
In the pilot project, the self-driving
truck is manoeuvring a stretch of some 300 kilometres (186 miles) between
Sodertalje and Jonkoping in Sweden's south, delivering fast-food goods.
From the outside, the vehicle
looks almost like any other lorry, save for a rail on the roof packed with
cameras and two sensors resembling bug antennae on the sides.
Inside the cab, the wheel and
seats are where you'd expect to find them, but small devices and screens dot
the dashboard and a nest of wires run to the computer rack housed behind the
passenger seat.
'Drives better by itself'
Engineer Goran Fjallid sits
next to the safety driver in the passenger's seat, eyes glued to his laptop as
it receives video from the truck's cameras and flickering text with information
about what the vehicle is seeing.
A second screen shows a
3D-visualisation of the truck on the road and all nearby vehicles.
The lorry combines all the
input from the various sensors with a GPS system, with the different
technologies acting as back-ups for each other.
"If the road markings
disappear for a while, then it will use the GPS and it stays perfectly in its
lane," Fjallid explains.
"It drives better by
itself than when you drive it manually," he adds.
But he acknowledges that a lot
of trial and error has gone into getting the truck to that point.
They've had to tweak things like how
the truck handles merging onto the motorway, and what to do when another car
cuts in front of it.
Every time the truck does something
unexpected, such as braking or slowing down for no apparent reason, Fjallid
makes a note of the exact timing so the logs and data can be examined.
The lorry's sensors are also calibrated
daily before hitting the road.
Hafmar says there are still some
hurdles to clear before driverless trucks -- without safety drivers -- become a
common sight on roads, both in terms of technology and legislation.
They expect to have this ready by the
end of the 2020s or the beginning of 2030s, Hafmar says.
The advent of self-driving trucks can
be seen as a threat to the jobs of truck drivers -- one of the world's most
common professions.
But Hafmar insists autonomous vehicles
are needed to address a global driver shortage.
And, he says, it will be a long time
before artificial intelligence will be able to handle all aspects of logistics.
Initially, self-driving lorries will
likely be used for long-haul trips, but the last-mile distribution to shops and
customers "will happen with human drivers", Hafmar adds.
More
Self-driving
lorries hit the road in Sweden (france24.com)
There can be few fields of human endeavour in which history
counts for so little as in the world of finance. Past experience, to the extent
that it is part of memory at all, is dismissed as the primitive refuge of those
who do not have the insight to appreciate the incredible wonders of the
present.
John Kenneth Galbraith.
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