Baltic Dry Index. 1723 +127 Brent Crude 82.47
Spot Gold 1819 US 2 Year Yield 4.21 -0.04
Coronavirus
Cases 02/04/20 World 1,000,000
Deaths 53,103
Coronavirus Cases 22/12/22 World 659,654,017
Deaths 6,678,285
When I was young
I thought that money was the most important thing in life; now that I am old I
know that it is.
Oscar Wilde.
In thin
year-end trading conditions, the traditional dress up the stock casinos is
underway, albeit very late this year.
To this
old dinosaur markets follower, unconvincingly in the face of what’s coming next
in 2023.
A final
exit rally rather than the new entry point.
In dying
cryptoland, the latest game in unicorn ranching is rollover. Is “CZ” now public enemy number one? Should
Jane Street be worried?
In other
news, oil and the Baltic Dry Index are rising, the inverted US yield curve is
slightly flattening. Mixed signals, but
probably just year-end noise.
Hong Kong stocks
rise nearly 3%, leading gains in Asia-Pacific; yen strengthens
UPDATED THU, DEC 22 2022 12:44 AM EST
Asia-Pacific shares traded higher on the
optimism on Wall Street as stocks saw a boost from upbeat earnings and a strong
consumer confidence reading.
Hong Kong’s Hang Seng index rose
2.45%, with property and technology stocks leading gains. In mainland China, Shanghai Composite rose
0.81% and the Shenzhen
Component was up fractionally.
The S&P/ASX 200 was
up 0.628% as Australia’s foreign minister Penny Wong met her Chinese
counterpart Wang Yi on Wednesday, and the two agreed to “restart dialogue” on trade and economic issues.
Japan’s Nikkei 225 added
0.48%, while the Topix gained 0.81%. The Japanese yen strengthened
further to stand at 131.9 against the U.S. dollar.
The Kospi in South
Korea gained 0.72% as the nation’s annualized producer price index for November
reached its lowest reading in 19 months. Thailand is scheduled to release its
November trade data later in the day.
Cryptocurrencies inch
up after FTX’s co-founder, Alameda’s co-CEO pleads guilty
Cryptocurrencies
inched higher after co-founder of embattled FTX Gary Wang and Alameda Research
co-CEO Caroline Ellison pleaded
guilty to federal charges.
Bitcoin last added
0.15% in the past 24 hours to trade at $16,826, according to Coin Metrics. Ether rose 0.34% to
$1,210.72.
Other digital coins
like Cronos and Cardano also climbed.
Former FTX CEO Sam
Bankman-Fried, who currently faces eight federal criminal charges was arrested
last week.
Asia
markets: Korea Producer Price, Thailand Trade, Japanese Yen, Hang Seng index
(cnbc.com)
Media
groups shed $500bn in value as shares head for historic drop
December 21 2022
More than
$500bn has been wiped off the market value of the world’s biggest media
companies this year as investors soured on the streaming revolution, triggering
historic share price declines for broadcasting and entertainment groups.
Intensifying
competition and rising costs have combined with consumer belt tightening and an
advertising slowdown to spark an industry-wide decline.
Media, which
for investors spans a broad range of activities from film production to
advertising to cable television, has been among the hardest-hit sectors in what
is set to be the worst year for global equities since the financial crisis.
“It’s been a
perfect storm of bad news,” said Michael Nathanson, media analyst at SVB
MoffettNathanson. “I’ve been covering this sector a long time and I’ve never
seen such a bad collection of data points before.”
Walt Disney
shares, down about 45 per cent, are heading for their biggest annual fall since
at least 1974. The shares have come under more pressure in recent days as
takings from Disney’s eagerly anticipated Avatar sequel
fell short of some estimates in its opening weekend.
Paramount
Global has dropped 42 per cent this year and Netflix 52 per cent, while Warner
Brothers Discovery has tumbled 63 per cent since its creation this year by the
combination of Discovery and AT&T’s WarnerMedia.
The
conglomerate’s executives are trying to integrate two of the largest operations
in media at a time of industry turmoil, and last week warned it faced as much
as $5.3bn in restructuring and other charges related to the merger.
Streaming
companies tended to cope well with the onset of the pandemic as lockdown restrictions
boosted audiences, pushing shares across the sector higher in the stock market
boom from March 2020.
But while
executives spent tens of billions of dollars on streaming content, viewing
options have proliferated while living costs have soared — encouraging
financially squeezed households to “churn”, or switch between subscriptions.
The Dow Jones
Media Titans index, which tracks the performance of 30 of the world’s biggest
media companies, has shed 40 per cent this year, with its total market value shrinking
from $1.35tn to $808bn.
Rising
interest rates have dented valuations, particularly of the sector’s
jam-tomorrow “growth stocks”. Music provider Spotify has slumped 69 per cent
and video specialist Roku 81 per cent.
More
Media
groups shed $500bn in value as shares head for historic drop (worldnewsera.com)
As we end
a very rocky 2022, are we ending the era of fiat dollar supremacy? It’s too
early to know of course and Britain and Canada are forever joined to the US
dollar fiat currency, but what about the rest of the world? A weaponised dollar
has shaken faith in the “level playing field.” Certainly, a non-dollarised
international economy will be less efficient, but a weaponised dollar is a
threat to all but ABC.
Suddenly Everyone Is
Hunting for Alternatives to the US Dollar
Thu, December 22, 2022 at 12:52 AM GMT
(Bloomberg) -- King Dollar is facing a revolt.
Tired of a too-strong and newly
weaponized greenback, some of the world’s biggest economies are exploring ways
to circumvent the US currency.
Smaller nations, including at least a
dozen in Asia, are also experimenting with de-dollarization. And corporates
around the world are selling an unprecedented portion of their debt in local
currencies, wary of further dollar strength.
No one is saying the greenback will
be dethroned anytime soon from its reign as the principal medium of exchange.
Calls for “peak dollar” have many times proven premature. But not too long ago
it was almost unthinkable for countries to explore payment mechanisms that
bypassed the US currency or the SWIFT network that underpins the global
financial system.
Now, the sheer strength of the
dollar, its use under President Joe Biden to enforce sanctions on Russia this
year and new technological innovations are together encouraging nations to
start chipping away at its hegemony. Treasury officials declined to comment on
these developments.
“The Biden administration made an
error in weaponizing the US dollar and the global payment system,” John
Mauldin, an investment strategist and president of Millennium Wave Advisors
with more than three decades of markets experience, wrote in a newsletter last
week. “That will force non-US investors and nations to diversify their holdings
outside of the traditional safe haven of the US.”
Plans already underway in Russia and
China to promote their currencies for international payments, including through
the use of blockchain technologies, accelerated rapidly after the invasion of
Ukraine. Russia, for example, began seeking remuneration for energy supplies in
rubles.
Soon, the likes of Bangladesh,
Kazakhstan and Laos were also stepping up negotiations with China to boost
their use of the yuan. India began talking up more loudly the
internationalization of the rupee and just this month, started securing a
bilateral payment mechanism with the United Arab Emirates.
Progress however appears to be slow.
Yuan accounts haven’t gained traction in Bangladesh for example due to the
nation’s wide trade deficit with China. “Bangladesh has tried to pursue
de-dollarization in trade with China, but the flow is almost one-sided,” said
Salim Afzal Shawon, head of research at Dhaka-based BRAC EPL Stock Brokerage
Ltd.
A major driver of those plans was the
move by the US and Europe to cut off Russia from the global financial messaging
system known as SWIFT. The action, described as a “financial nuclear weapon” by
the French, left most major Russian banks estranged from a network that
facilitates tens of millions of transactions every day, forcing them to lean on
their own, much smaller version instead.
That had two implications. First, the
US sanctions on Russia stoked concern that the dollar could more permanently
become an overt political tool — a concern shared especially by China, but also
beyond Beijing and Moscow. India, for example, has been developing its own
homegrown payments system that would partly mimic SWIFT.
Second, the US decision to use the
currency as part of a more aggressive form of economic statecraft puts extra
pressure on economies in Asia to choose sides. Without any alternative payments
system, they’d run the risk of being compelled into compliance with, or
enforcement of, sanctions they may not agree with — and losing out on trade
with key partners.
More
Suddenly
Everyone Is Hunting for Alternatives to the US Dollar (yahoo.com)
Finally,
in cryptoland, yet another bankruptcy filing. Rollover!
Core Scientific files
for bankruptcy as crypto winter bites
December 21, 2022
(Reuters)
-Core Scientific Inc, one of the biggest publicly traded cryptocurrency mining
companies in the United States, said on Wednesday it filed for Chapter 11
bankruptcy protection, the latest in a string of failures to hit the sector.
More than a
trillion in value has been wiped out from the crypto sector this year on rising
interest rates and exacerbating worries of an economic downturn. The slump has
eliminated key industry players such as Three Arrows Capital and Celsius Network.
The bigger
blow came after major crypto exchange FTX filed for bankruptcy protection last
month. Its swift fall has also sparked tough regulatory scrutiny of how crypto
firms hold funds and conduct business operations.
Several crypto
companies have since been plagued by contagion concerns from the fallout of the
FTX collapse, which has quashed hopes of a recovery in prices of digital assets
in the near-term.
After rapid
growth in 2020 and 2021, bitcoin - the most popular digital currency by far -
is down more than 60% this year, pressuring the crypto mining sector.
Core
Scientific said in a statement the bankruptcy filing was necessitated by a
decline in the company's operating performance and liquidity amid the prolonged
decrease in the price of bitcoin.
The company's
shares have lost roughly 98% of their value so far in 2022, shrinking its
market cap to about $78 million. The stock fell another 26% in premarket
trading on Wednesday. Shares of other crypto miners including Riot Blockchain,
Marathon Digital and Hut 8 Mining Corp have all shed more than 80% this year.
Austin,
Texas-based Core Scientific said it would not liquidate and would continue to
operate normally, as it expects to enter into a restructuring support agreement
with its creditors, who represent over 50% of the holders of its convertible
notes.
One of the
largest creditors of Core Scientific, B. Riley Financial Inc, had offered $72
million last week to avoid the bitcoin miner's bankruptcy.
In its
bankruptcy petition, Core Scientific said it has $1 billion to $10 billion in
assets and liabilities, and creditors between 1,000 and 5,000.
Core
Scientific went public in 2021 through a merger with a blank-check company in a
deal that at the time valued the miner at $4.3 billion.
Core Scientific files for bankruptcy as crypto winter
bites (msn.com)
FTX’s Gary Wang,
Alameda’s Caroline Ellison plead guilty to federal charges, cooperating with
prosecutors
FTX co-founder Gary Wang and former Alameda
Research co-CEO Caroline Ellison both pleaded guilty to federal charges in the
Southern District of New York, U.S. Attorney Damian Williams said in a message
Wednesday.
Wang pleaded guilty to conspiracy to commit
wire fraud, wire fraud, conspiracy to commit commodities fraud and conspiracy
to commit securities fraud. Ellison pleaded guilty to two counts of wire
fraud, two counts of conspiracy to commit wire fraud, conspiracy to commit
commodities fraud, conspiracy to commit securities fraud and conspiracy to
commit money laundering.
The charges were released the same
night that former FTX CEO Sam Bankman-Fried was en route from the Bahamas to
New York, where he faces eight federal criminal charges from the same
prosecutors who accepted plea deals from Ellison and Wang. The duo’s plea
agreements were signed on Monday, the day that Bankman-Fried was originally
supposed to return to the U.S. before a court hearing in the Bahamas
devolved into chaos.
More
'They will come to a bad
ending': Just over a year since its $69K peak, Bitcoin has plummeted more than
70% — here's why Warren Buffett has hated cryptocurrency all along
Wed, December 21, 2022 at 12:00 PM GMT
It's been a tough year for Bitcoin
and its backers. Even back in 2018, the Oracle of Omaha himself predicted that
it and other cryptocurrencies were headed for trouble.
"They will come to a very bad
ending," Warren Buffett told CNBC at the time.
After hitting an all-time peak of
around $69,000 per unit on November 10, 2021, the world's leading digital
currency has since erased roughly 75% of its value, sitting at $16,600 as of
the end of the trading day on Dec. 19.
----What would the world's most famous investor say to those
who might be thinking of firing up their investment apps and buying Bitcoin at
a bargain price?
“If you ... owned all of the bitcoin
in the world and you offered it to me for $25, I wouldn’t take it,” Buffett
told CNBC earlier this year.
Other than Bitcoin's disappointing
track record, here are three more reasons Buffett won’t go near it.
More
Global Inflation/Stagflation/Recession Watch.
Given
our Magic Money Tree central banksters and our spendthrift politicians,
inflation now needs an entire section of its own.
Economists Place 70%
Chance for US Recession in 2023
Tue, December 20, 2022 at 11:00 AM GMT
(Bloomberg) -- Economists say there is a
7-in-10 likelihood that the US economy will sink into a recession next year,
slashing demand forecasts and trimming inflation projections in the wake of
massive interest-rate hikes by the Federal Reserve.
The probability of a downturn in 2023
climbed from 65% odds in November and is more than double what it was six
months ago, according to the latest Bloomberg monthly survey of economists. The
poll was conducted Dec. 12-16, with 38 economists responding about the chance
of a recession.
The median estimates see gross
domestic product averaging a paltry 0.3% next year, including an annualized
0.7% decline in the second quarter and flat readings in the first and third
quarters. Consumer spending, which accounts for about two-thirds of GDP, is
projected to barely grow in the middle half of the year.
“The US economy is facing big
headwinds from surging interest rates, high inflation, the end of fiscal
stimulus, and weak export markets abroad,” said Bill Adams, chief economist at
Comerica Bank. “Businesses have turned cautious about adding to inventories and
hiring, and will likely delay construction and other capex plans with credit
more expensive and order books shrinking.”
---- As high inflation and
borrowing costs deal a blow to household finances, businesses are also seen
pulling back. Economists project bigger declines in private investment, which
include spending on equipment and structures, in the first three quarters of
2023 than they did a month ago. Those outlays are seen falling 3% on average.
Less investment, weak household
spending and a global economy on the brink of a recession will hit the nation’s
manufacturers particularly hard. The Bloomberg survey shows economists
downgraded their estimates of industrial production for every quarter next
year. Output is now seen averaging a 0.7% decline in 2023, much weaker than the
0.2% increase that was projected in November.
Economists Place
70% Chance for US Recession in 2023 (yahoo.com)
With new mortgages down 47%, US lenders are starting
to go bankrupt — could this one factor trigger the worst surge of failures
since 2008?
December
20 2022
The real estate market just can’t
catch a break, with inventory of resale homes remaining low and rising interest
rates making it harder for buyers to justify making the leap.
And now we can add mortgage
lender financial troubles — and the rise (and fall) of “non-qualified mortgages” — to the factors aggravating an already uncertain
market.
A report from ATTOM reveals that
new mortgage originations were down 47% in the third quarter of 2022 compared
to the year before. That's a 19% decrease from the previous quarter and
represents the biggest annual drop in 21 years. And while the chill in the
market affects all lenders, non-bank lenders — especially those who deal in NQM
— are bearing the brunt of it.
But what does the trouble around
these NQM mortgages really mean? And what does it mean for non-traditional
buyers trying to get a foothold in the market?
A “non-qualified” mess?
NQMs use non-traditional methods
of income verification and are frequently used by those with unusual income
scenarios, are self-employed or have credit issues that make it difficult to
get a qualified mortgage loan.
They’ve previously been touted as an option for creditworthy borrowers who can’t otherwise
qualify for traditional mortgage loan programs.
But with First Guaranty Mortgage
Corp. and Sprout Mortgage — a pair of firms that specialized in non-traditional
loans not eligible for government backing — running aground this year, real
estate experts are beginning to question their value.
First Guaranty filed for
bankruptcy protection in the spring while Sprout Mortgage simply shut down
early this summer.
In documents tied to its bankruptcy
filing, First Guaranty leaders
said once interest rates started to climb, lending volume dropped and left the
company with more than $473 million owed to creditors.
More
Below, why a “green energy” economy may not be possible, and if it is, it won’t be quick and it will be very inflationary, setting off a new long-term commodity Supercycle. Probably the largest seen so far.
The
“New Energy Economy”: An Exercise in Magical Thinking
https://media4.manhattan-institute.org/sites/default/files/R-0319-MM.pdf
Mines,
Minerals, and "Green" Energy: A Reality Check
https://www.manhattan-institute.org/mines-minerals-and-green-energy-reality-check
"An
Environmental Disaster": An EV Battery Metals Crunch Is On The Horizon As
The Industry Races To Recycle
by Tyler Durden Monday, Aug 02, 2021 - 08:40 PM
Covid-19 Corner
This section will continue until it becomes unneeded.
With Covid-19 starting to become only endemic,
this section is close to coming to its end.
Today, a victory for common sense in the USA,
putting to shame Trudeau’s Canada, Australia and the rump-EU.
White
House Can’t Mandate COVID Jabs for Federal Contractors: Appeals Court
By December 20, 2022 Updated: December 20, 2022
A
federal appeals court on Monday struck down a White House rule requiring anyone employed by a federal
contractor to be vaccinated against COVID-19 as a condition of government
contracts.
A
three-panel judge of the Fifth Circuit Court of Appeals voted 2-1 to affirm a
lower court judgment that barred President Joe Biden’s September 2021 executive order in three states after
Louisiana, Indiana, and Mississippi sued to challenge the rule.
These
three states sued the Biden administration in the Western District of
Louisiana in their capacities as federal contractors themselves, winning an
injunction and stay by the district court.
In upholding the lower court finding, Judge Kurt
Engelhardt, an appointee of former President Donald Trump, said in his majority
opinion (pdf) that a broad interpretation of the law could have given
Biden “nearly unlimited authority to introduce requirements into federal contracts.”
He
illustrated his point by saying that Biden could “hypothetically” mandate that
all third-party federal contractors’ employees reduce their BMI (body mass
index) below a certain number based “on the theory that obesity is a primary
contributor to unhealthiness and absenteeism.”
The U.S.
government has contracts with hundreds of third-party contractors, and judges
have indicated that the issue might affect up to 20 percent of American
employees.
Indiana
Attorney General Todd Rokita touted the ruling as a legal victory against what
he called President Joe Biden’s executive overreach.
Rokita,
who joined with two other plaintiff states in the legal action, decried Biden’s
“truly unprecedented” use of the federal Procurement Act to wield
executive power to impose the mandate on third-party contractors.
“Hoosiers
and all Americans should have the liberty to make their own decisions on
whether to get vaccinated,” Rokita said in a statement. “That includes
individuals who happen to work as federal contractors. No one should have to
fear losing their jobs just because they opt against getting a shot.”
Louisiana
Attorney General Jeff Landry called the appeals court’s decision
a “victory for freedom.”
“We
will continue to stand up against these abuses of power that threaten us now
and in the future,” he said in
a statement.
More
White House Can’t
Mandate COVID Jabs for Federal Contractors: Appeals Court (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.
No tech update today.
Today, dumbed down Finance, 2021 - 2022
style, from Professor Boyle of King's College London. Is it any wonder where
we’re ending 2022 where we are? Approx. 8 minutes. His follow on video is worth
watching too.
ALL IN
FLOKI INU
The old believe everything, the middle-aged suspect everything,
the young know everything.
Oscar Wilde.
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