Baltic Dry Index. 1402 -23 Brent Crude 76.39
Spot Gold 1962 US 2 Year Yield 4.24 +0.12
Coronavirus
Cases 01/04/20 World 1,000,000
Deaths 53,103
Coronavirus Cases 19/05/23 World 688,668,272
Deaths 6,877,081
Little else is requisite to carry a state to the highest degree of opulence from the lowest barbarism, but peace, easy taxes, and a tolerable administration of justice: all the rest being brought about by the natural course of things.
Adam Smith, Lecture in 1755.
In the central bankster fuelled stock casinos, party on like it’s 2019 all over again.
Peace has broken out in the District of Crooks, as lions lie down with sheep avoiding a US debt default. At least, that was the media spin all day yesterday.
Well maybe but maybe not, besides how much is this debt ceiling peace going to cost and who exactly is going to pay for it? Look away from that bizarre inverted US yield curve now.
With recession looming in H2 23 and social anarchy breaking out from Latin America to Pakistan, owning over priced stocks in an approaching bear market looks like the least of our worries for 2023-2024.
Japan stocks
surge to highest since 1990 as G-7 meeting is underway
UPDATED THU, MAY 18 2023 11:24 PM
EDT
Asia-Pacific markets largely rose as two of the
three Wall Street’s major indexes hit record highs on Thursday night and House
Speaker Kevin McCarthy says that he is confident a deal can be struck on the
U.S. debt ceiling by next week.
The S&P 500 and Nasdaq Composite jumped
on Thursday to notch their highest closing levels since August 2022 as Wall
Street traders kept focused on debt ceiling negotiations.
Leaders
from the Group of 7 will be gathering in Hiroshima, Japan for
the G-7 summit that kicks off today.
Japan stocks were on course to
seeing its best week since October as the Nikkei 225 rose
0.86%, maintaining
the highest levels since 1990 and the Topix climbed 0.33%— marking its sixth winning streak.
Japan’s core inflation in April rose 3.4% year-on-year, maintaining levels
above the central bank’s target.
Australia’s S&P/ASX 200 inched
up 0.43%, while South Korea’s Kospi gained
0.56% and the Kosdaq was 0.27% higher.
Greater China markets meanwhile
bucked the trend: Hong Kong’s Hang
Seng index fell 1.49% and the Shanghai Composite slid
0.44% in mainland China. The Shenzhen
Component was marginally lower.
Overnight
in the U.S., all three major indexes were up for a second straight
day, with the Nasdaq gaining 1.51% and hitting 52-week highs, while the S&P
added 0.94%. The Dow
Jones Industrial Average climbed 0.34%
Japan stocks surge to
highest since 1990 as G-7 meeting is underway (cnbc.com)
Biden's
team reports 'progress' in US debt ceiling talks
May
19, 20235:01 AM GMT +1
HIROSHIMA, Japan, May 19 (Reuters) -
Democratic negotiators told President Joe Biden on Friday that they are making
"steady progress" in talks with Republicans aimed at avoiding a U.S.
default, according to a White House official.
Biden received an
update on the talks with aides to Republican House of Representatives Speaker
Kevin McCarthy on Friday morning in Japan, where he is traveling for the Group
of 7 (G7) summit, officials said.
"The president’s team informed him
that steady progress is being made," according to one of the officials,
who declined to be named.
"The president
directed his team to continue pressing forward for a bipartisan agreement and
made clear the need to protect essential programs for hardworking Americans and
the economic progress of the past two years as negotiations head into advanced
stages. He remains confident that Congress will take necessary action to avoid
default."
Republicans have
refused to vote to lift the debt ceiling past its $31.3 trillion limit unless
Biden and his Democrats agree to spending cuts in the federal budget.
The U.S. government may default on some
debts as early as June 1 unless Congress
votes to lift the debt ceiling, and economists fear the country will slide into
a recession.
Biden cut his trip
to Asia short and now plans to return home on Sunday to finish the
negotiations, eliminating stops in Papua New Guinea and Australia aimed at
countering China's influence in the region.
In the meantime,
White House adviser Steve Ricchetti, budget director Shalanda Young and
legislative adviser Louisa Terrell are leading discussions for the
administration.
More
Biden's
team reports 'progress' in US debt ceiling talks | Reuters
In other news, difficult times lie ahead even
after a US debt default is avoided.
Your
Evening Briefing: Glimmers of Hope and a Warning on Debt Deal
18 May 2023 at 23:22 BST
There are some optimistic
noises being made about the US debt-ceiling fight. But Wall
Street is warning that even if disaster
is avoided, the economy won’t escape damage from this spectacular
own-goal by Congress. Behind market
fears of a historic default is the less-discussed risk of what
would follow a deal.
Many predict lawmakers will ultimately reach an agreement,
but the bruising standoff and the Treasury’s efforts to return to business as
usual will wreak significant collateral damage. Ari Bergmann, whose firm
specializes in risks that are hard to manage, says investors should hedge for
the aftermath. Here’s
why.
Here are today’s top stories
The fallout is already global. America’s sway over the world economy is being eroded by
self-inflicted policy wounds—and not just of the debt-ceiling variety.
From a slow-off-the-blocks Federal Reserve in 2021 to this year’s regional
bank bonfire, the rest of the world is
wondering if the dollar’s preeminent status in global trade and
finance may be worth reconsidering.
Record-low unemployment in the US was even
stronger than previously thought. Applications for
benefits fell by the most since 2021 after fraudulent claims in at
least one state had boosted numbers in previous
weeks. Stocks climbed on hopes a default will be avoided and Treasury
yields rose on speculation the Fed will need to keep interest rates higher for
longer. Here’s your markets
wrap.
More
Bloomberg
Evening Briefing: Glimmers of Hope and a Warning on Debt Deal - Bloomberg
Another Debt Ceiling Crisis, Another Deficit
Reduction Scam
May 18, 2023 DAVID STOCKMAN
Today’s stock market action was still
another reminder that honest price discovery on Wall Street is deader than a
doornail.
Apparently, as a
result of some friendly-sounding PR gas-bagging this AM from both sides of the
debt ceiling stand-off, the market rallied hard in the morning and stayed
pinned at that level for the balance of the session.
----That is to say, we
seriously doubt that there will be any signed deal before the so-called X-date
of June 1. And if some Rube Goldberg device is patched together at the 11th
hour, it will make hardly an iota of difference to the nation’s disastrous
fiscal outlook.
Indeed, here’s a
spoiler alert version of what is coming down the pike. With or without a deal,
the Federal debt-to-GDP ratio is heading for record peacetime levels. And the
alternate pathways shown in the graph below assume there will never again be
another recession, war, Covid-type national emergency or any other deviation
from CBO’s picture perfect projection of economic performance and Congressional
adherence to the massive tax increases and outyear spending
cuts already built into current law and the CBO baseline forecast.
The actual truth is
that the current policy baseline already generates $20 trillion of new Federal
debt over the 10-year budget window (FY 2024-2033). But that figure would be
$25 trillion at minimum when adjusted for realistic economics and the virtual
certainty that currently scheduled out-year tax increases and spending cuts
will be cancelled at the last minute, like they always are.
In turn, that means
the public debt will hit a minimum of $55 trillion by 2033 or nearly 150% of
GDP.
More
Another
Debt Ceiling Crisis, Another Deficit Reduction Scam (substack.com)
Global debt nears
record highs as rate hikes trigger ‘crisis of adaptation,’ top trade body says
PUBLISHED THU, MAY 18 2023 5:23
AM EDT
The global debt pile grew by $8.3 trillion in the
first quarter to a near-record high of $305 trillion as the global economy
faced a “crisis of adaptation” to rapid monetary policy tightening by central
banks, according to a closely-watched report from the Institute of
International Finance.
The finance industry body said the combination of
such high debt levels and rising interest rates has driven up the cost of
servicing that debt, triggering concerns about leverage in the financial
system.
Central banks around the world have been hiking
interest rates for over a year in a bid to rein in sky-high inflation.
The U.S. Federal Reserve earlier
this month lifted its fed funds rate to a target range of 5%-5.25%, the highest since August 2007.
“With financial
conditions at their most restrictive levels since the 2008-09 financial crisis,
a credit crunch would prompt higher default rates and result in more ‘zombie
firms’ — already approaching an estimated 14% of U.S.-listed firms,” the IIF
said in its quarterly Global Debt Monitor report late Wednesday.
The sharp increase in
the global debt burden in the three months to the end of March marked a second
consecutive quarterly increase following two quarters of steep declines during
last year’s run of aggressive monetary policy tightening. Non-financial corporates
and the government sector drove much of the rebound.
“At close to $305
trillion, global debt is now $45 trillion higher than its pre-pandemic level
and is expected to continue increasing rapidly: Despite concerns about a
potential credit crunch following the recent turmoil in the banking sectors of
the U.S. and Switzerland, government borrowing needs remain elevated,” the IIF
said.
The Washington,
D.C.-based organization said aging populations, rising health care costs and
substantial climate finance gaps are exerting pressure on government balance
sheets. National defense spending is expected to increase over the medium term
due to heightened geopolitical tensions, which would potentially affect the
credit profile of both governments and corporate borrowers, the IIF projected.
“If this trend
continues, it will have significant implications for international debt
markets, particularly if interest rates remain higher for longer,” the report
noted.
Total debt in
emerging markets hit a new record high of more than $100 trillion, around 250%
of GDP, up from $75 trillion in 2019. China, Mexico, Brazil, India and Turkey
were the largest upward contributors.
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.
Today,
telecoms trouble and more. Just wait until AI really starts replacing workers.
BT
share price tumbles as firm announces tens of thousands job cuts
THURSDAY 18 MAY 2023 8:20 AM
BT has announced plans to slash its workforce by
as much as 42 per cent over the next seven years in a bid to slash costs and
become a “leaner business”.
The
firm’s share price was down more than 9 per cent in early trading.
In its full year results today, the telecoms giant
said it would look to cut its 130,000 headcount to between 75,000 to 90,000 by
2028 to 2030.
“By continuing to build and connect like fury,
digitise the way we work and simplify our structure, by the end of the 2020s BT
Group will rely on a much smaller workforce and a significantly reduced cost
base,” said BT chief Philip Jansen.
“New BT Group will be a leaner business with a
brighter future.”
The scale of the job cuts represents one of the
largest announced on the stock exchange in recent memory.
The update came as the firm said its “cost
transformation” was “on track” with gross annualised cost savings of £2.1bn
since April 2020 against a £3bn target, with a cost to achieve of £1.1bn
against a target of £1.6bn
Revenues at the frim dipped one per cent to
£20.86bn in the year to the end of March after a slowdown in its consumer,
enterprise and global divisions. A four per cent boost in revenues in its
Openreach unit helped cushion the blow, however.
Pre tax profits also fell 12 per cent to £1.73bn
which bosses said was down to “increased depreciation from network build and
specific items, partially offset by adjusted EBITDA growth”.
BT has been looking to revive its share price in
recent months after an 18 per cent slide over the past year.
“We have delivered our outlook for FY23: this year
we’ve grown both pro forma revenue and EBITDA for the first time in six years
while navigating an extraordinary macro-economic backdrop. Over the last four
years we have stuck firmly to our strategy and it’s working,” Jansen said.
The
move comes just days after Vodafone announced 11,000 jobs would go.
BT share price tumbles as firm announces tens of thousands job cuts (cityam.com)
Soft Data Fading In Europe
Leaves Equity Market On Bed Of Sand
THURSDAY,
MAY 18, 2023 - 10:00 AM
Buoyant soft data
has driven much of the recent optimism in Europe but it is now beginning to
sour, leaving the equity market poised to begin underperforming after
outpacing DM stocks for most of the past two years.
The German ZEW’s
expectations component came in significantly weaker than forecast.
This gives a good six-month lead on the euro-zone’s
composite PMI, and points to it weakening through the remainder of the year.
Expectations for
growth in the euro-zone last year and this year were dismal. But a milder
winter led to a less-bad-than-feared outcome, and soft, survey-based data like
the PMI registered this optimism, helping fuel sentiment and a stock-market
rally.
But all the hopium
in the world won’t by itself change the hard data, which is what ultimately
counts. Growth is barely above zero, retail sales are contracting, and credit
is tightening.
Economic surprises
have been rising, but they were driven primarily by soft data exceeding
expectations. Hard data (apart from labor) consistently disappointed. Now soft
data is disappointing as lofty expectations are coming up against reality and
heading back to earth.
More
Soft Data Fading
In Europe Leaves Equity Market On Bed Of Sand | ZeroHedge
Covid-19 Corner
This section will continue until it becomes unneeded.
A Plethora of Skin Symptoms
Reported After COVID Vaccination, Solution Exists
Overlooked
COVID Vaccine Adverse Events (Part 7)
May 16, 2023
Jeff Jackson, a man in his late 40s, is a father, son, and former construction worker who used to be self-sufficient.
Yet less than two years after developing a skin-related vaccine injury,
Jackson has been cut off from friends and family and lives on social welfare
and donations from strangers.
After getting a second dose of the COVID-19 mRNA vaccine at his local Walmart store, he was walking back to his apartment complex when his mother, walking behind him, noticed dark red shapes moving on the back of his head.
This occurred around 15 minutes after vaccination, Jackson said.
----Postvaccine Skin Reactions
Jackson is likely one of the worst-case scenarios for skin reactions to the vaccine. But unfortunately, no one has any answers for why he developed these symptoms.
However, most skin reactions reported
in the literature have been relatively mild and self-resolving.
“We can conceptualize vaccine
reactions as both allergic and autoimmune,” Dr. Jonathan Kantor, professor
of dermatology from the University of Pennsylvania, wrote to The Epoch Times.
Allergic reactions to the vaccine
are probably rarer, while the autoimmune reactions are more common but tend to
resolve over time, he continued.
Common Skin Reactions
COVID arm, which occurs as a rash
appearing several days after injection, is a common side effect of the COVID-19
vaccine. The rash can become red and swollen, manifesting across most of the
forearms. Most resolve after a few days with or without topical steroids and
may not recur if the person is injected for a second time.
While research has documented
these rashes as a potential vaccine allergic reaction, Dr. Kimberly Blumenthal,
a clinical professor and allergist from Harvard University specializing in drug
allergies, said they might actually be unexplained immune reactions.
Another common skin reaction is
COVID toes. These reactions were first
reported in acute COVID, where patients’ toes develop skin
sores or bumps that typically occur after exposure to frigid
temperatures. Similar
presentations have also been reported after COVID-19
vaccinations.
Allergic Reactions
COVID-19 vaccines can trigger
allergic reactions.
Urticaria, a type of itchy red
rash, can appear acutely or as a chronic condition following vaccination. While
not life-threatening, the itchiness and discomfort can discourage further
immunization.
In a Harvard study that
followed 271 patients who developed urticaria after COVID-19 vaccination, about
70 percent reported that they wouldn’t get additional doses even if
recommended.
Reports of eczema after
vaccination have also increased.
More
A Plethora of Skin Symptoms Reported After COVID
Vaccination, Solution Exists (theepochtimes.com)
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.
Environmental sustainability innovation: Leading
companies in Graphene batteries for the automotive industry
May 17, 2023
The
automotive industry continues to be a hotbed of innovation, with activity
driven by the need for increased electrode density, faster cycle times and
improving the battery’s lifespan, and growing importance of technologies such
as graphene enhanced lithium-sulphur battery and graphene enhanced polymer
battery. In the last three years alone, there have been over 1.2 million
patents filed and granted in the automotive industry, according to GlobalData’s
report on Environmental sustainability in Automotive: Graphene batteries.
However, not all innovations
are equal and nor do they follow a constant upward trend. Instead, their
evolution takes the form of an S-shaped curve that reflects their typical
lifecycle from early emergence to accelerating adoption, before finally
stabilising and reaching maturity.
Identifying where a
particular innovation is on this journey, especially those that are in the
emerging and accelerating stages, is essential for understanding their current
level of adoption and the likely future trajectory and impact they will
have.
290+ innovations will
shape the automotive industry
According to GlobalData’s
Technology Foresights, which plots the S-curve for the automotive industry
using innovation intensity models built on over 619,000 patents, there are 290+
innovation areas that will shape the future of the industry.
Within the emerging innovation
stage, EV discharge prediction, fuel cell ion exchange membranes, and hydrogen
ICE fuel tanks are disruptive technologies that are in the early stages of
application and should be tracked closely. V2G smart metering, silicon-air
batteries, and zeolites for exhaust filtering are some of the accelerating innovation
areas, where adoption has been steadily increasing. Among maturing innovation
areas are HEV propulsion systems and wind-powered vehicles, which are now well
established in the industry.
---- Graphene batteries is a key innovation area in
environmental sustainability
Graphene batteries are an innovative
technology that facilitates better electrode density and quicker cycle times,
along with the ability to hold the charge longer thus enhancing the battery's
lifespan.
GlobalData’s analysis also uncovers
the companies at the forefront of each innovation area and assesses the
potential reach and impact of their patenting activity across different
applications and geographies. According to GlobalData, there are 10+ companies,
spanning technology vendors, established automotive companies, and
up-and-coming start-ups engaged in the development and application of graphene
batteries.
More
Who are the
leading innovators in graphene batteries for the automotive industry?
(just-auto.com)
Another weekend and what news will be spun out of the G-7 meeting in US nuked Hiroshima Japan, and more importantly Washington District of Crooks? With US interest rates still soaring and the US yield curve grotesquely inverted. More bank failures lie ahead plus a massive US commercial real estate bust. Bunker time in spades. Have a great weekend everyone.
It is the interest of every man to
live as much at his ease as he can; and if his emoluments are to be precisely
the same, whether he does, or does not perform some very laborious duty, it is
certainly his interest…either to neglect it altogether, or…to perform it in [a]
careless and slovenly a manner.
Adam Smith, The
Wealth Of Nations, 1776.
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