Baltic Dry Index. 1560 +35 Brent Crude 85.12
Spot Gold 2008 U S 2 Year Yield 3.97 +0.15
For crying out loud the inflation-adjusted Fed funds rate is still -1.9%, meaning that the FOMC is so far behind the inflation curve that they can barely see its tail lights.
And we are not talking here about a few
months of excessive rate repression that needs correction. To the contrary,
during the past 180 months—since the eve of the GFC in March 2008—the Fed funds
rate has been negative in real terms 96% of the time.
When
is Easter?
Approx.
12 interesting minutes. Some interesting comments too.
Happy
Easter, everyone.
Not
much need for input from me this Easter weekend. The articles speak loudly for
themselves.
Recession
is coming. The US proxy war on Russia is destroying Ukraine and eastern European
farming plus German industry.
With
the paymaster of continental Europe crumbling, how long before the rump-EUSSR
starts to split?
More
banking crisis lies ahead.
More
crypto currency turmoil lies ahead.
More
cost of living social disorders and strikes in Europe lies ahead.
Our
G-7 “leadership” has never looked more irrelevant or inept.
Job growth totals 236,000 in March, near expectations as
hiring pace slows
Nonfarm payrolls growth in March was about in line
with expectations, but showed signs that the jobs picture is in the early
stages of a slowdown.
The Labor Department reported Friday that payrolls
grew by 236,000 for the month, compared to the Dow Jones estimate for 238,000
and below the upwardly revised 326,000 in February.
The unemployment rate ticked lower to 3.5%, against
expectations that it would hold at 3.6%, with the decrease coming as labor
force participation increased to its highest level since before the Covid
pandemic.
Though it was close to what economists had
expected, the total was the lowest monthly gain since December 2020 and comes
amid efforts from the Federal Reserve to slow labor demand in order to cool
inflation.
Along with the payroll gains came a 0.3% increase
in average hourly earnings, pushing the 12-month increase to 4.2%, the lowest
level since June 2021. The average work week edged lower to 34.4 hours.
“Everything is moving in the right direction,” said
Julia Pollak, chief economist for ZipRecruiter. “I have never seen a report
align with expectations as much today’s over the last two years.”
Though
the stock market is closed for Good Friday, futures rose following the report.
Treasury yields also moved higher.
----The report comes amid a bevy of signs that job
creation is on wane.
In separate reports this week, companies reported
that layoffs surged in March, up nearly 400% from a year ago, while jobless
claims were elevated and private payroll growth also appeared to slow. The
Labor Department also had reported that job openings fell below 10 million in
February for the first time in nearly two years.
That all has followed a year-long Fed campaign to
loosen up what had been a historically tight labor market. The central bank has
boosted its benchmark borrowing rate by 4.75 percentage points, the quickest
tightening cycle since the early 1980s in an effort to bring down spiraling
inflation.
The job gains came during a month in which the
failure of Silicon Valley Bank and Signature Bank rocked the financial world.
Economists expect the banking troubles to have repercussions in coming months.
“The March data effectively are a look back into
the pre-SVB world; the payroll survey was conducted the week after the bank
failed, far too soon for employers to have responded. But the hit from tighter
credit conditions is coming,” wrote Ian Shepherdson, chief economist at
Pantheon Macroeconomics.
Several Fed officials said this week they remain
committed to the inflation fight and see interest rates staying elevated at
least in the near term. Market pricing shifted following Friday’s report, with
traders now expecting the Fed to implement one last quarter percentage point
hike in May.
More
Jobs report
March 2023: (cnbc.com)
Ties That Bind Asset Classes Have Come Loose
6 April 2023 at 23:22 BST
Treasury yields tumble the most in a decade as gold
soars, stocks sit at two-month highs and credit spreads tighten. It’s a mess
out there, and divining a unified signal from markets has rarely been harder. The ties that
normally bind asset classes have come loose.
Treasuries and equities both gained last month.
Treasury turbulence remains well above stock volatility after March saw the
widest gap between the two since 2008. Gold neared an all-time high on rate-cut
bets even as credit traders showed confidence in company balanced sheets. And
investors keep pouring cash into money market funds. Indeed, about $350 billion flowed into them in the four weeks ending April 5—pushing
assets to a record $5.25 trillion.
Meanwhile, stocks on Thursday eked out small
gains as traders await Friday’s key US jobs report. Big tech led a rebound in
equities, which garnered a respite after Federal Reserve Bank of St. Louis
President James Bullard said he didn’t think tight credit conditions stemming from recent banking turmoil will cause a
recession.
----Goldman Sachs says the approaching US earnings season is expected to be
the gloomiest since the first year of the pandemic. Analyst consensus
expectations are for S&P 500 earnings-per-share to fall 7% in the first
quarter from a year earlier, marking the sharpest decline since the third
quarter of 2020 and a low point in the profit cycle,
the bank’s strategists wrote in an investor note.
US banks are pitted against each other as regulators move to strengthen
oversight. In particular, regional banks, which are more likely to face new
rules, are trying to convince regulators to increase oversight of
larger ones—which may have to cover a larger portion of the costs of recent
bailouts. Meanwhile, Congress—which loosened regulations in 2018—is less
amenable than ever to lobbying pitches for weaker regulation.
More
Bloomberg Evening Briefing: Ties That Bind Asset Classes Have Come Loose - Bloomberg
Professor
Patrick Boyle on our latest banking crisis. Approx. 18 minutes.
Jamie
Dimon Warns Banking Crisis 'Is Not Yet Over!'
Jamie
Dimon Warns Banking Crisis 'Is Not Yet Over!' - YouTube
In
bankster news, “trust me I’m a bankster” has never worked less.
U.S. banks are dangling promotions
to lock in customer deposits, analysts say
April
6, 2023 5:40 AM GMT+1
NEW YORK, April 6 (Reuters) - For months, consumers have clamored for
banks to pay out more for deposits as the Federal Reserve raised interest
rates. Now analysts say after the banking crisis shook markets last month,
lenders appear to be rejigging offers in an effort to keep customers' cash
parked in their accounts for longer.
U.S. banks are trying to woo depositors by offering signing bonuses to
open new accounts or deposit money on a regular basis. The promotions are
running at a time when the failures of Silicon Valley Bank (SVB) and Signature
Bank last month spooked customers, prompting them to move $119 billion out of
smaller institutions.
Capital One
Financial Corp (COF.N) is advertising a $100 bonus for opening a new
savings account and keeping more than $10,000 in it for 90 days. The offer
ramps up to a bonus of $1,000 for deposits of over $100,000. Discover Financial
Services (DFS.N) and
LendingClub (LC.N) are offering similar perks, which were in
effect before the bank runs began.
Citizens Financial
Group (CFG.N) is
offering a $25 bonus for customers who put in $100 a month for three months and
maintaining a minimum balance, according to emails sent to customers after
March 10. The offer is part of a pre-planned campaign to promote healthy
savings habits, and not in reaction to specific events, Citizens spokeswoman
Eleni Garbis said in a statement.
Capital One and Discover did not immediately respond to requests for
comment.
Paying more for deposits is an effective way for banks to keep customers
loyal, analysts said.
"As rates have risen, high-yield savings accounts have become
fashionable once again with some banks competing aggressively to stay at the
top of the rate tables that consumers rely on for comparison purposes,"
said Andrew Davidson, chief insights officer at Mintel, a market intelligence
agency.
"The intense competition has been further fueled by an overall drop
in deposits with more firms reaching out to customer in the last few
weeks," he added.
More
U.S. banks are dangling promotions to lock in customer deposits, analysts say | Reuters
Exclusive: German banks hit by
wave of complaints from savers
April
6, 2023 6:15 AM GMT+1
FRANKFURT, April
6 (Reuters) - Complaints from consumers about banks and other financial firms
in Germany rose by a fifth last year, official data shows, as regulators flex
their muscles to shore up trust in the sector.
BaFin,
Germany's financial watchdog, has been increasing its focus on consumer
protection in the wake of the collapse of Wirecard,
the blue-chip payment company that folded in an accounting scandal.
It received
15,000 complaints from consumers in Europe's largest economy about their banks
and other financial service providers last year, up from 12,500 in 2021 and a
fourth consecutive year of sharp increases.
Gripes include long processing times for account
closures, changes to terms and conditions, and shrinking branch networks,
according to officials, bankers and consumer protection advocates.
The figures, reported by Reuters for the first
time, will be made public in an annual report in May.
"It cannot be that financial institutions are
doing well because they treat their customers badly," Chan-Jae Yoo, a
BaFin official, said in an interview.
Deutsche
Kreditwirtschaft, an umbrella organisation that lobbies for German finance,
said German banks are "extremely stable and robust" and confidence
remains "high" and "unaffected" by recent turmoil stemming
from the collapse of lenders in the United States and Switzerland.
But a survey last
year by YouGov showed that degree of trust in Germany's financial sector,
essential for promoting wider financial stability and attracting capital to
support economic growth, was below the global average, lagging the likes of
Canada, Australia and major Asian markets.
More
Exclusive: German
banks hit by wave of complaints from savers | Reuters
UBS chairman warns over 'huge
amount of risk' of integrating Credit Suisse after £2.6bn rescue
April
6, 2023
The chairman of UBS has warned the bank faces 'a
huge amount of risk' as it tries to integrate its collapsed rival Credit Suisse
following an emergency takeover.
Colm Kelleher told the Swiss lender's annual
general meeting in Basel that while the £2.6bn rescue was a 'milestone', it was
'not in any way an easy deal'.
With shareholders lining up to express concern, he
said the integration could take up to four years, saying: 'You cannot just put
numbers together and reach a sum - you have to understand there is a huge
amount of risk in integrating these businesses.'
UBS vice-chairman Lukas Gaehwiler said unifying
operations would be 'a Herculean task'.
The deal was cobbled together two weeks ago in a
'shotgun marriage' orchestrated by the Swiss government and other
officials.
Vincent Kaufmann, chief executive of the Ethos
foundation, which represents around 3pc of UBS investors, was 'concerned about
this giant new bank', which will turn UBS into the world's fourth-largest
lender with £4trillion in assets.
He said that the deal concentrated a 'huge' amount
of risk in the Swiss market into a single entity.
Other investors called on UBS to learn lessons from
its collapsed rival to avoid the same fate.
'We need to radically change the culture of
bonuses... otherwise we will be waking up one day with UBS having gone down the
drain as well,' said Martin Schutz, a shareholder.
Decentralized
Cryptocurrency Markets Threaten U.S. Security, Treasury Says
In
new report, the department lays foundation for regulation, enforcement of
‘DeFi’ markets
April 6, 2023 10:27 am ET
WASHINGTON—The burgeoning decentralized
cryptocurrency market threatens U.S. national security and needs
greater oversight and enforcement against money-laundering, the U.S. Treasury
Department said on Thursday.
The warning, in a new Treasury report assessing the
risk of the so-called DeFi markets, lays the foundation for tougher regulations
and punitive action by federal agencies.
DeFi
platforms enable crypto investors to transact with each other through software
running online, without a central intermediary overseeing transactions. Without
the intermediaries of traditional finance such as banks, regulators
currently have little insight into DeFi transactions.
Ransomware hackers, rogue states and other national
security threats have seized upon the market’s opaqueness to move money around
the world without detection, facilitating the financing critical to their
operations, the Treasury Department report said.
“Illicit actors, including criminals, scammers, and
North Korean cyber actors are using DeFi services in the process of laundering
illicit funds,” said Brian Nelson, Treasury’s undersecretary for terrorism and
financial intelligence. “Capturing the potential benefits associated with DeFi
services requires addressing these risks.”
The report sketches out how the Treasury Department
plans to bring the market under greater federal oversight, suggesting that
platforms that fail to establish sufficient vetting policies risk enforcement
action.
More
Decentralized Cryptocurrency
Markets Threaten U.S. Security, Treasury Says - WSJ
Finally,
that endless US-Ukrainian proxy war on Russia is now destroying farming in
Poland and Romania.
Romanian farmers block borders in
protest over Ukrainian grain imports
April
7, 2023 2:35 PM GMT+1
BUCHAREST, April 7 (Reuters) - Thousands of farmers
protested across Romania on Friday over the impact of Ukrainian grain imports
on prices, blocking traffic and border checkpoints with tractors and trucks and
urging the European Commission to intervene.
Anger is rising among farmers in Central and
Eastern Europe over a flood of cheap Ukrainian grain imports, exempt from
customs fees until June 2024, which have hurt prices and sales of local
producers.
Ukraine,
one of the world's largest grain exporters, had its Black Sea ports blocked following Russia's February 2022
invasion and found alternative shipping routes through European Union states
Poland and Romania, helped by "solidarity lanes" supported by the EU.
But
millions of tonnes of grain - cheaper than those produced in the EU - ended up
in neighbouring countries, propelled by logistical bottlenecks and lesser
distances.
Polish
Agriculture Minister Henryk Kowalczyk resigned from his post this week. Polish
and Bulgarian farmers have also held protests.
In
the capital Bucharest on Friday, about 200 farmers protested outside the
European Commission’s local headquarters, carrying banners which read: "We
respected EU rules but EU ignored us", "You can no longer pass
through here" and "Stability for Romanian farmers".
Across
the country, thousands of farmers used tractors, trucks and other machinery to
block roads and borders.
"We
are talking about unfair competition in the European community," said Nicu
Vasile, the head of the league of Romanian associations of farm producers
(LAPAR).
"I
know our Ukrainian colleagues also need to sell, but it is unfair competition,
however."
Vasile
said production costs of wheat have risen 70% on the year to 6,000 lei ($1,326)
per hectare.
The commission
has estimated farmers from Poland, Romania, Hungary, Bulgaria and Slovakia have
lost 417 million euros ($455 million) overall from the inflows of cheaper
Ukrainian grains. It decided to hand out compensation worth 56.3 million euros
to Polish, Bulgarian and Romanian farmers, with more to come.
"It's
a concrete measure, but the sums are small, it is true," Romanian Farm
Minister Petre Daea said on Friday. The ministry will double the amount given
to Romania.
On
Wednesday, Ukrainian President Volodymyr Zelenskiy said he expected decisions to be
announced in coming days and weeks to alleviate anger among Polish farmers. Six
prime ministers in the region have asked the commission to intervene.
Romanian farmers block borders in protest over Ukrainian grain imports | 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.
'Powell's curve'
plunges to new lows, flashing US recession warning
April
6, 2023 10:36 PM GMT+1
NEW
YORK, April 6 (Reuters) - The Federal Reserve's preferred bond market signal of
an upcoming recession has plunged to fresh lows, bolstering the case for those
who believe the central bank will soon need to cut rates in order to revive
economic activity.
Research from the Fed has argued that the
"near-term forward spread" comparing the forward rate on Treasury
bills 18 months from now with the current yield on a three-month Treasury bill
was the most reliable bond market signal of an imminent economic contraction.
That spread, which has been in
negative territory since November, plunged to new lows this week, standing at
nearly minus 170 basis points on Thursday.
Fed Chair Jerome Powell said
last year that the 18-month U.S. Treasury yield curve was the most reliable
warning of an upcoming recession.
"Powell's curve ...
continues to plunge to fresh century lows," Citi rates strategists William
O'Donnell and Edward Acton said in a note on Thursday. Refinitiv data showed
the curve was the most inverted since at least 2007.
More
'Powell's curve'
plunges to new lows, flashing US recession warning | Reuters
Half a trillion in debt haircuts essential
for sustainability - study
April
6, 2023 1:07 AM GMT+1
LONDON, April 6 (Reuters) - Up to half a trillion dollars in debt needs
to be written off to help developing nations at greatest risk of default return
to sounder fiscal footing and meet climate and development goals, according to
a Boston University report released on Thursday.
The haircuts on debt owed to public and private creditors by 61 of the
nations that are already in or are at most risk of debt distress are essential
to avoid "cascading defaults," according to calculations from the
Boston University Global Development Policy Center and the Debt Relief for a
Green and Inclusive Recovery (DRGR) Project.
"Without ambitious debt relief, many of the poorest countries don't
have a chance," said Kevin P. Gallagher, DRGR project co-chair and
director of the Boston University Global Development Policy Center.
The COVID-19 pandemic, followed by food and fuel shocks in the wake of
Russia's invasion of Ukraine in 2022, put enormous strain on public finances
and led to soaring borrowing costs.
At the same time, emerging market sovereign debt increased by 178% since
the global financial crisis, rising to $3.9 trillion by 2021, the report found,
and the structure of lenders became increasingly complex.
The researchers found that some $812 billion in debt across all creditor
classes should be in scope for restructuring.
To achieve the best outcome, researchers proposed to include instruments
that had alleviated previous emerging market debt crises.
This included a guarantee facility that would provide enhancements - or
forms of guarantees - for newly issued Brady bonds focussed on green and
inclusive recovery which private and commercial creditors can swap with a
significant haircut against old debt, the report said.
"The proposal is in many ways a modern-day version of the Brady
Plan and the Highly Indebted Poor Countries (HIPC) Initiative of the 1990s
combined — the last time that debt distress threatened our development
goals."
More, much, much more.
Half a trillion in debt haircuts essential for sustainability - study | 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.
Another Covid vaccine fails.
AstraZeneca vaccine banned. Approx. 16 minutes.
AZ
vaccine banned in Australia
AZ vaccine banned in Australia -
YouTube
World
Health Organization - Landscape of COVID-19 candidate vaccines. https://www.who.int/publications/m/item/draft-landscape-of-covid-19-candidate-vaccines
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 more useful Covid links.
Johns Hopkins Coronavirus
resource centre
https://coronavirus.jhu.edu/map.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, I’ve added this section.
No update this Easter weekend.
This weekend something Different for
Easter. Three music diversions. Up first
Prague’s very talented F. X. Brixi again. Approx. 16 minutes.
F.X.
Brixi Organ Concerto in D major, Vera Hermanova
F.X.
Brixi Organ Concerto in D major, Vera Hermanova - YouTube
František
Brixi
---Brixi was born in Prague,[1] the
son of composer Šimon Brixi.[2] He
received his musical education at the Piarist Gymnasium in Kosmonosy.[1] His
teachers included Václav
Kalouscs, a
significant composer himself.[2]
In 1749 Brixi left Kosmonosy
and returned to Prague, where he worked as an organist at
several churches.[2] In
1759 he was appointed Regens chori (choir director) and Kapellmeister of St Vitus Cathedral, thus attaining, at age 27, the highest musical position
in the city;[a][1] this
office he held till his early death. He wrote some 290 church works (of the
most varied type), cantatas and oratorios, chamber compositions, and orchestral compositions. He was a prolific composer
of music for the liturgy, and wrote more than 100 masses,[4] vespers and motets, among others. He also composed secular music such
as oratorios and incidental music, concertos and symphonies.[5][6][7] His
organ concertos, which have been recorded several times each, are his
best-known pieces today.
Brixi died of tuberculosis in
Prague in 1771, at the age of 39.[1]
More
This
Easter weekend’s second music diversion. Vivaldi again. Approx. 8 minutes.
Antonio
Vivaldi: Concerto for 2 horns, strings & b.c. in F major (RV 539)
Antonio
Vivaldi: Concerto for 2 horns, strings & b.c. in F major (RV 539) - YouTube
This
Easter weekend’s final music diversion.
Approx. 9 minutes.
Johann
David Heinichen, Concerto en ré majeur S.226 pour violon, flute, hautbois,
théorbe et cordes
This weekend’s Easter bonus, Why Afghanistan ended in total fiasco.
It
was all Trump’s fault, no honest it was, cross my heart and hope to die. “Because
he didn’t have a plan, we didn’t have a plan either, besides who knew you
needed a plan anyway?”
Duke
of Medina Sidonia, Admiral Kirby sinks his fleet. Probably why it was
released right ahead of Good Friday and the Easter holiday weekend. Hopefully
no one will ever notice.
Approx.
5 minutes of cringeworthy, prevaricating, fibbing and dissembling.
‘Is
This All We Get?’: Reporter Grills John Kirby On 12-Page Afghanistan Withdrawal
Report
‘Is This All We
Get?’: Reporter Grills John Kirby On 12-Page Afghanistan Withdrawal Report -
YouTube
In 2001 [UK] Labour aide Jo Moore faced stern
criticism after suggesting the September 11 attacks were a "good day to
bury bad news".
Miss Moore, who worked for Stephen Byers, at the
Secretary of State for Transport, Local Government and the Regions, was widely
condemned for showing spin at its worst when her news management memo was
leaked.
She resigned the following year, but the
perception that government might occasionally look to "bury" news
stories during big events remained.
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