Baltic Dry Index. 1043 -53 Brent Crude 82.77
Spot Gold 1883 US 2 Year Yield 4.24 +0.05
Coronavirus
Cases 02/04/20 World 1,000,000
Deaths 53,103
Coronavirus Cases 12/01/23 World 669,893,308
Deaths 6,720,910
True, governments can reduce the rate of
interest in the short run, issue additional paper currency, open the way to
credit expansion by the banks. They can thus create an artificial boom and the
appearance of prosperity. But such a boom is bound to collapse soon or late and
to bring about a depression.
There is no means of avoiding the final
collapse of a boom brought about by credit expansion. The alternative is only
whether the crisis should come sooner as the result of a voluntary abandonment
of further credit expansion, or later as a final and total catastrophe of the
currency system involved.
Ludwig von Mises.
It is US inflation data release day and the stock casinos are all anticipating another drop in the rate of inflation.
That, if it happens, should allow the Fed to return to more modest future interest rate hikes of only 25 basis points before ending interest rate hikes sometime in late summer.
That, according to the stock casino perma-bulls, means it’s time once again to load up on beaten down stocks.
Well maybe, but probably not.
A new global recession is just getting underway. China is about to slow down for their Great Lunar New Year holiday, which this year comes with the added risk of a Great Covid-19 contagion.
Asia-Pacific
shares trade mixed as U.S. inflation data remains firmly in spotlight
UPDATED WED, JAN 11 2023 10:30 PM
EST
Asia-Pacific shares were mixed as investors look
ahead to the U.S. consumer price index report Thursday. Economists expect
inflation to have cooled in December, which could signal to the Federal Reserve
that previous interest rates hikes have had their intended effects.
Australia’s S&P/ASX 200 traded
up 1.2% after the release of the country’s November trade balance.
The Nikkei 225 was
flat while the Topix climbed 0.34%. South Korea’s Kospi edged up
0.18% while the Kosdaq dipped fractionally.
Hong Kong’s Hang Seng index declined
0.73%, reversing earlier gains. Mainland China’s Shanghai Composite lost
0.24% and the Shenzhen
Component was down 0.077%. China’s consumer price index rose
1.8% in December from a year ago, in line with Reuters’ expectations.
India’s inflation data for December is also
slated for release.
Overnight on Wall Street, major
stock indexes closed higher. Economists surveyed
by Dow Jones expect the inflation print to show that prices
cooled by a modest 0.1% in December from November.
China’s consumer
price index rises 1.8% in December
Inflation in China
accelerated 1.8% in December compared with a year ago as food prices rose, data from the National Bureau of Statistics showed.
“The prices of
fresh vegetables and fresh fruits rose by 7.0% and 4.7%,
respectively,” the report said.
The CPI figure was
in line with Reuters’ expectations and higher than the previous month’s reading
of 1.6%.
The reading was
also flat with November’s, improving from a 0.2% decline.
China’s producer
price index dipped 0.7% in December versus last year, worse than expectations
of a 0.1% drop.
Asia-Pacific
shares mixed as U.S. inflation data remains in spotlight (cnbc.com)
European markets
head for positive open; U.S. inflation data to come
UPDATED THU, JAN 12 202312:27 AM
EST
European markets are
expected to open higher as global investors gear up for the December reading of
U.S. consumer prices on Thursday.
U.S.
stock futures were little changed in overnight trading
Wednesday and Asia-Pacific
shares were mixed as investors awaited the key inflation report
to gauge the outlook for the U.S. Federal Reserve’s rate-hiking campaign.
Economists expect
the U.S. consumer price index to dip 0.1% for December but rise 6.5% year over
year, compared with a 0.1% monthly gain in November and an annual pace of 7.1%,
according to Dow Jones. The CPI is well off the 9.1% peak rate in June.
European
markets live updates: Stocks, data, earnings and news (cnbc.com)
China's exports seen cooling further in December on
weak global demand, COVID woes- Reuters poll
Thu, 12
January 2023 at 6:06 am GMT
BEIJING (Reuters) - China's export
and imports are expected to have continued to struggle over December, due to
the spread of COVID-19 in the country disrupting production lines and waning
demand both at home and abroad, a Reuters poll showed on Thursday.
Data from December are expected to
show a 10.0% fall in outbound shipments from a year earlier, after November's
figures were down an annual 8.7%, according to the median forecast of 29
economists in the poll. That would mark the worst reading since Feb. 2020.
Imports are expected to have fallen
at a slower pace at 9.8% over December, after a fall of 10.6% in November.
Actual trade data will be released on
Friday.
With many of China's trade partners
on the verge of going into recession, external demand is cooling, only adding
to the pressure Chinese policymakers are under to stem the economic fallout of
the spread of COVID.
Sub-indexes for new export orders in
both the official and private sector China factory activity surveys extended
declines last month, with the official figure the lowest it has been since
April 2022.
"The trade outlook could be a
top threat to China's growth ambition next year," said analysts at Citi in
a note. "We are concerned about the external demand amid global recession
risks... our base case is a modest decline of exports in 2023E," they
added.
Beijing dismantled its
"zero-COVID" rules at the beginning of December, leading to a massive
wave of infections that made their way from the capital to manufacturing hubs
near Shanghai, including those in the Yangtze River Delta.
The "closed loop" system
that many plants had come to rely on over the past three years started to fall
apart as infection numbers crept up within workforces.
High numbers of infected workers have
resulted in a number of manufacturers announcing the introduction of a reduced
production schedule, including Tesla, which last month announced it would
continue to do so at its gigafactory in Shanghai into this month.
Economists are also worried about the
fiscal deficit between China and the United States and the EU getting bigger.
"The current COVID wave could last at least a few months, by then the U.S.
and the EU will likely be in recession, hurting China's exports," wrote
Iris Pang, Chief Economist for Greater China at ING, in a note.
Finally,
yet more bad news from Cryptoland.
FTX:
Now UK investors are caught up in collapse of crypto trading platform
WEDNESDAY 11 JANUARY 2023 10:24 AM
Thirteen investors
caught up in the collapse of cryptocurrency trading platform FTX have made fraud
reports to UK police.
FTX filed for bankruptcy
on November 11 after it was alleged that then-chief executive Sam Bankman-Fried, 30, had
illegally diverted massive sums of customer money from the company to a second
firm that he owned, Alameda Research.
According to a Freedom
of Information request made on behalf of the
Investing Reviews website, 13 people made reports to Action Fraud, the UK’s
national reporting centre for alleged fraud, in November last year.
The total loss
reported was £1.16 million, with the biggest individual loss at £1 million.
Simon Jones, chief
executive of InvestingReviews.co.uk, said: “The bad news is that the British
investor who lost £1 million is unlikely to ever see a penny of their money
again.
“The Financial Conduct
Authority has been at pains to warn investors about the dangers of cryptocurrency, so if you’re
tempted, make sure you don’t put all your eggs in one basket.”
City of London Police
said that it has passed details of the reports to the US authorities.
Bankman-Fried denies
criminal charges linked to the collapse of FTX and is due to
face trial in the US in October.
FTX: Now UK
investors are caught up in collapse of crypto trading platform (cityam.com)
Coinbase
to layoff 20 per cent of staff as crypto market declines
TUESDAY 10 JANUARY 2023 8:12 PM
Coinbase Global (Coinbase) revealed on Tuesday it
will reduce its workforce by about 20 per cent, or 950 employees, as part of a
restructuring plan, in a third round of layoffs for the cryptocurrency exchange
since last year.
The company said it expects to incur about $149m to
$163m in restructuring expenses. Its shares reversed course to fall 2.7 per
cent premarket after rising more than five per cent on the layoffs announcement
earlier.
“The entire industry is going through a crisis of
confidence and trading volume remains very weak, this job cut is a reflection
of the current challenging environment,” said Owen Lau, analyst at Oppenheimer.
Last year, rising interest rates and worries of an
economic downturn wiped out more than a trillion dollars from the crypto
sector.
The slump also forced key industry players such as
Three Arrows Capital and Celsius Network to shut shop.
However, the bigger blow came after crypto
exchange FTX filed for bankruptcy protection in November.
“We also saw the fallout from unscrupulous actors
in the industry, and there could still be further contagion,” Coinbase chief
executive Brian Armstrong said in a blog post on Tuesday.
Coinbase said it had no additional comment on the
plan.
“This (job cuts) is a move that can help with
near-term operating leverage,” said Mizuho analyst Ryan Coyne, adding that it
would not fix the underlying issue of rapidly deteriorating volumes.
“It is going to require much more significant cost
cutting to accommodate the current volume run rate.”
The crypto sector’s woes have continued this year,
marked by plunging deposits, layoffs and multiple legal hurdles.
Coinbase in November cut more than 60 jobs in its
recruiting and institutional onboarding teams, after slashing 1,100 jobs, or 18
per cent of its workforce, in June.
The company’s shares lost about 86 per cent of
their value last year.
Coinbase to layoff
20 per cent of staff as crypto market declines (cityam.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.
Fed Chair Jerome Powell Goes Quiet
As Bond Markets See Recession, Rate Cuts
Federal
Reserve Chairman Jerome Powell said nothing about rate hikes during a speech in
Stockholm Tuesday. His silence spoke volumes.
January 11 2023
Often, it's what isn't said
that deserves the most attention.
Federal Reserve Chairman
Jerome Powell's decision to sidestep the issue of inflation and rate
hikes during a central banking conference in Stockholm this week, as markets
bet against his previous hawkish signals,
may prove as pivotal as his late August speech in Jackson Hole when he snuffed
out a summertime rally with gloomy projections and a vow to carry on
tightening.
Despite minutes from Fed meetings warning that rates will rise
past 5%, and stay there for some time,
suggestions of near-term hikes from Fed Governors in media interviews and
Powell's recent warnings on the risks of unchecked consumer price risks, stock
and bond markets have continued to test the central bank's overall
inflation-fighting message.
The S&P
500 has risen around 3.36%
since late December, a modest gain when compared to last year's brutal 20%
decline, but nonetheless telling in the face of the Fed's hawkish
warnings.
The CME Group's FedWatch, meanwhile, is pricing in a 79.2% chance of a 25 basis point rate
hike from the central bank on February 1, with bets on a potential rate cut
emerging in the Fed's September meeting.
Benchmark 2-year note
yields, which closed at 4.403% at the end of December, have fallen to around
4.21% amid easing wage pressures in the job market, a grim assessment of services sector activity from the
ISM survey and bets on a tame December inflation reading from the Commerce
Department later this week.
That sits a long, long way
from the Fed's projection of a Fed Funds rate that's
north of 5%, which it sees hitting in early spring, and echoes rate hike bets
from FedWatch that not only see rates peaking below 5%, but forecast rate cuts
over the second half of the year.
So who do we believe?
Jeffrey Gundlach, the famed
bond investor who runs DoubleLine Capital, has few doubts: “My 40 plus
years of experience in finance strongly recommends that investors should look
at what the market says over what the Fed says,” he told a webcast late
Tuesday.
More
Fed Chair Powell Silent As Bond Markets See Recession, Rate Cuts - TheStreet
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.
Omicron XBB.1.5
does not have mutations known to make people sicker, WHO says
The omicron XBB.1.5 subvariant does not have any
mutations known to make people sicker when they catch the virus, according to a World Health Organization risk assessment published
Wednesday.
But the WHO noted in the report
that it doesn’t have any real-world data on how XBB.1.5 is affecting patients’
health, so it cannot draw any conclusions at this time about the severity of
the subvariant.
The WHO said XBB.1.5 is one of the
Covid subvariants that is most adept at dodging immunity from vaccination or
infection. It is just as immune evasive as another subvariant in its family,
XBB.1, which was the Covid variant that best dodged antibodies that block
infections.
The global health organization said
XBB.1.5 has a growth advantage in the U.S., particularly in the Northeast,
where it has rapidly become dominant. XBB.1.5 could cause cases to increase
globally, but it’s difficult to know for sure because almost all of the data is
coming from the U.S., according to the WHO. The organization said it needs more
data on how fast XBB.1.5 is spreading in other countries.
Maria Van Kerkhove, the WHO’s Covid-19 technical
lead, said last week that XBB.1.5 is the most
transmissible Covid subvariant to date. Scientists believe it has a
growth advantage because it is highly immune evasive and binds more tightly to
human cells, making it more infectious.
“It is the most transmissible
subvariant that has been detected yet,” Van Kerkhove told reporters during a
press conference Jan. 4 in Geneva. “The reason for this are the mutations that
are within this subvariant of omicron allowing this virus to adhere to the cell
and replicate easily.”
In the U.S., XBB.1.5 is the only
subvariant showing substantial growth right now. It rose from about 2% of cases
in early December to nearly 28% in the first week of January, according to data
from the Centers for Disease Control and Prevention. It is causing more than
70% of new Covid cases in the Northeast.
More
Covid
news: Omicron XBB.1.5 doesn't have mutations known to make people sicker
(cnbc.com)
Chinese
fret over elderly as WHO warns of holiday COVID surge
January 12, 2023 5:52
AM GMT
BEIJING, Jan 12
(Reuters) - People in China worried on Thursday about spreading COVID-19 to
aged relatives as they planned returns to their home towns for holidays that
the World Health Organization warns could inflame a raging outbreak.
The
Lunar New Year holiday, which officially starts from Jan. 21, comes after China
last month abandoned a strict anti-virus regime of mass lockdowns that prompted
widespread frustration and boiled over into historic protests.
That abrupt
U-turn unleashed COVID on a population of 1.4 billion which lacks natural
immunity, having been shielded from the virus since it first erupted in late
2019, and includes many elderly who are not fully vaccinated.
The
outbreak spreading from China's mega-cities to rural areas with weaker medical
resources, is overwhelming some hospitals and crematoriums.
With
scant official data from China, the WHO on Wednesday said it will be
challenging to manage the virus over a holiday period considered the world's
largest annual migration of people.
More
Chinese
fret over elderly as WHO warns of holiday COVID surge | Reuters
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.
BGS Announces the Release of its Graphene-Enhanced Admixture
for the Concrete Market
Toronto, ON - TheNewswire - January 11, 2023 - Bio Graphene Solutions (“BGS” or the “Company”), announced today the
development of the Company’s first graphene-enhanced product for the concrete
market.
Leveraging its
capability of converting 100% organic materials into high-quality graphene via
a patented cleantech process, BGS has developed a strength performance
admixture for commercial concrete mix designs.
Developed
primarily to tackle the removal of cement (the binding material in a concrete
mix that also contributes to more than 8% of the global CO2 emissions due
to its harmful manufacturing process), the Company’s graphene admixture can
remove at least 15% of the cement content in concrete without sacrificing the
compression strength performance of the overall concrete product. BGS believes
its graphene-enhanced admixture is the only admixture product in the market
that can facilitate the removal of cement utilizing graphene’s nanotechnology
and still provide significant cost and CO2 savings to its potential
customers in non-specialized commercial concrete mix designs (25MPa to 40MPa
mixtures).
After conducting more than 3,000 compression strength tests, and a focus on a 40MPa concrete mix design (typically used for condominiums in creating external walls, slabs, structural pilings, and foundations), BGS observed the following with its graphene admixture:
- After removing 15% of the cement content, a 25% increase in strength gain as early as 7-days, and that strength gain maintained or increasing over a 28-day period (as shown in Table 1.1)
- After removing 15% of the cement content, the ability to enable a 40MPa mix design to behave like that of a 60MPa mix design after 28-days
- Significant
strength performance synergies with supplementary cementitious materials
(SCMs), like that of slag, even after removing 15% of the cement content
in a 40MPa concrete mix
- Rapid strength gains even after removing 15% of the cement content - with 40MPa trials attaining strength performance results in 5-days (110% or 44MPa) that required 28-days for the control (no cement reduction) to achieve
- Acceptable workability rates (“slump” numbers) required for commercial use
- Replacing
the need for a water reducer (admixtures designed to mimic the addition of
water that is present in concrete mixtures to improve workability rates
without compromising strength) further improving the cost savings of the
overall concrete mix design
---- All concrete testing and data
relating to the Company’s results was performed and verified by 3rd party
certified concrete lab facilities in Ontario.
More
Nothing is so admirable in
politics as a short memory.
John Kenneth Galbraith.
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