Baltic Dry Index. 1090 -13 Brent Crude 79.14
Spot Gold 1954 US 2 Year Yield 4.74 +0.15
St Swithin’s Day is a day on July 15 that commemorates a ninth century bishop of Winchester who died in 862. According to folklore, the weather on this day predicts the weather for the next 40 days and 40 nights. If it rains on St. Swithin’s Day, it will rain for 40 days, but if it is fair, 40 days of fair weather will follow
Well it rained at some point on St. Swithin’s Day in most of the UK, so a wet 40 days yet to come. I wonder how well St. Swithin’s Day correlates to UK stocks?
This morning, disturbing economic news out of China. The economy bounce back from last year’s Covid lockdowns seems to have stalled.
Exports and imports are falling against 2022s numbers, inflation has dropped down to zero, youth unemployment gas soared to over 21 percent.
Is China, the second largest national global economy, about to export deflation next, to the rest of the world?
It may not yet be “as goes China, so goes the
world.” But it’s uncomfortably close. American Secretaries now troop to Beijing
for meetings, Beijing’s no longer troop to Washington.
Asia markets fall; China’s economy grew 6.3%,
missing expectations
UPDATED SUN, JUL 16 2023 11:58 PM
EDT
Asia-Pacific markets fell on Monday as investors
digested key economic data from China.
Most notably, the world’s number
two economy reported that GDP
for the second quarter grew 6.3%, lower than economists expected.
Hong Kong markets will likely be
closed all Monday due to a warning issued for Typhoon Talim. The Hong Kong Observatory expects
storm signal No. 8 to remain in force until at least 4pm.
The Hong Kong Exchange usually cancels the
morning trading sessions if the typhoon signal is No. 8 or above, and all
trading sessions for the day will be cancelled if signal No. 8 or above remains
in force by noon.
In mainland China, the Shanghai Composite fell
1.19%, leading losses in the region and the Shenzhen Component was
down 0.89%.
In Australia, the S&P/ASX 200 was
marginally lower. The country will release unemployment figures later this
week, which will give clues to the Reserve Bank of Australia’s rate decisions.
South Korea’s Kospi dipped 0.52%,
but the Kosdaq was up 0.24%, while Japan’s markets are closed for Marine Day.
In Southeast Asia, Singapore’s
non-oil domestic exports dropped 15.5% in June compared to a
year earlier, while more trade data will be released from Indonesia later.
U.S. markets were mixed on Friday, with the Dow Jones Industrial Average reaching
its highest level since March as strong earnings results from some of the
biggest banks and companies kicked off earnings season.
However, the S&P 500 dropped
0.10%, and the Nasdaq
Composite declined 0.18%, but both indexes touched their
highest intraday levels since April 2022.
Asia
markets fall; China's economy grew 6.3%, missing expectations (cnbc.com)
China
reports second-quarter GDP miss, another record high in youth unemployment
BEIJING — China said
Monday that second-quarter gross domestic product grew by 6.3% from a year ago,
missing expectations.
The unemployment rate
among young people ages 16 to 24 was 21.3% in June, a new record.
The 6.3% GDP print for the
second quarter marked a 0.8% pace of growth from the first quarter, slower than
the 2.2% quarter-on-quarter pace recorded in the first three months of the
year. Analysts polled by Reuters had predicted a 7.3% increase in the second
quarter GDP.
National Bureau of
Statistics spokesperson Fu Linghui noted China faces a complex geopolitical and
economic international environment. He also said China can still achieve its
full-year growth target. Beijing in March set a goal of around 5% growth for
2023.
Retail sales for June
rose by 3.1%, a touch below the 3.2% expected. Within retail sales, that of
catering, sports and entertainment products along with alcohol and tobacco rose
the most. Autos, office products and daily use goods saw sales decline in June
from a year ago. Online sales of physical goods grew by 6.7% in June from a
year ago, slower than in May, according to CNBC calculations of official data
accessed via Wind Information.
Industrial production
for June rose by 4.4% from a year ago, better than the 2.7% forecast.
Fixed asset
investment for the first half of the year rose by 3.8%, better than the 3.5%
predicted. Within fixed asset investment, that into real estate fell further on
a year-to-date basis in June than in May. Investment in manufacturing grew at a
steady pace, while growth in infrastructure investment slowed.
The unemployment rate
for people in cities was 5.2% in June.
When asked about the
outlook for the second half, spokesperson Fu said he expected real estate
investment would remain low for the near future.
He also said youth
unemployment might rise further before declining after August.
More
China
reports Q2 GDP miss, another record high in youth unemployment (cnbc.com)
China's frail Q2 GDP
growth raises urgency for more policy support
BEIJING,
July 17 (Reuters) - China's economy grew at a frail pace in the second quarter
as demand weakens at home and abroad, with the post-COVID momentum faltering
rapidly and raising pressure on policymakers to deliver more stimulus to shore
up activity.
Chinese
authorities face a daunting task in trying to keep the economic recovery on
track and putting a lid on unemployment, as any aggressive stimulus could fuel
debt risks and structural distortions.
Gross
domestic product grew just 0.8% in April-June from the previous quarter, on a
seasonally adjusted basis, data released by the National Bureau of Statistics
showed on Monday, versus analysts' expectations in a Reuters poll for
a 0.5% increase and compared with a 2.2% expansion in the first quarter.
On
a year-on-year basis, GDP expanded 6.3% in the second quarter, accelerating
from 4.5% in the first three months of the year, but the rate was well below
the forecast for growth of 7.3%.
The
annual pace was the quickest since the second quarter of 2021, but it was
heavily skewed by economic pains caused by stringent COVID-19 lockdowns in
Shanghai and other major cities last year.
"The
data suggests that China's post-COVID boom is clearly over," said Carol
Kong, economist at Commonwealth Bank of Australia in Sydney.
"The
higher-frequency indicators are up from May's numbers, but still paint a
picture of a bleak and faltering recovery and at the same time youth
unemployment is hitting record highs."
More
timely June data, which was released alongside the GDP numbers, showed China's
retail sales grew 3.1%, slowing sharply from a 12.7% jump in May. Analysts had
expected growth of 3.2%.
Industrial
output growth unexpectedly quickened to 4.4% last month from 3.5% seen in May,
but demand remains lukewarm.
Private
fixed-asset investment shrank 0.2% in the first six months, a sharp contrast to
the 8.1% growth in investment by state entities, suggesting weak private
business confidence.
Recent
data showed a rapidly faltering post-COVID recovery as exports fell the
most in three years due to cooling demand
at home and abroad while a prolonged downturn in the key property market has
sapped confidence. The weak overall momentum has raised expectations
policymakers will need to do more to shore up the world's second-biggest
economy.
Authorities
are likely to roll out more stimulus steps
including fiscal spending to fund big-ticket infrastructure projects, more
support for consumers and private firms, and some property policy easing,
policy insiders and economists said.
But
a quick turnaround is unlikely, analysts say.
All
eyes are on an expected Politburo meeting later this month, when top leaders
could chart the policy course for the rest of the year.
More
China's
frail Q2 GDP growth raises urgency for more policy support | Reuters
Stock futures inch lower to start the week: Live
updates
UPDATED SUN, JUL 16 2023 6:53 PM
EDT
Stock futures dipped slightly in evening trading
Sunday ahead of a busy week for corporate earnings.
Futures tied to the Dow Jones
Industrial Average lost
50 points, or 0.16%, while S&P 500
futures slipped
0.13%. Futures connected to the Nasdaq 100 traded
0.10% lower.
Stocks are coming off a winning
week that saw the Dow Jones Industrial Average gain
2.3% to notch its best weekly gain since March. The S&P 500 and Nasdaq Composite added
2.4% and 3.3%, respectively. On Friday, the Dow rose 113.89 points, or 0.33%,
while the S&P and Nasdaq slipped 0.1% and 0.18%, respectively.
The moves came on the heels of
solid big bank earnings and softer inflation reports that lifted investor
sentiment. That heightened some hopes the Federal Reserve may be able to tamp
down inflation without tipping the economy into a recession.
“It’s the Goldilocks scenario,
it’s inflation coming down with near record low unemployment,” Kathryn Rooney
Vera, chief market strategist at StoneX, told CNBC’s “Last Call” on Friday.
“Yes, people have some pain ... with prices, but they have jobs. Evidence is
increasingly favorable for the soft landing viewpoint, and immaculate
disinflation is what has the market going crazy.”
Second-quarter earnings
season gains steam this week with results from big financial
institutions such as Bank of America, Morgan Stanley and Goldman Sachs.
Results are also due from United Airlines, Las Vegas Sands and
technology giants Tesla and Netflix.
Wall Street are bracing for what
be a gloomy season with lower profits. Analysts forecast a more than 7% decline
in S&P 500 earnings from a year ago, according to FactSet.
This week also ushers in the
Fed’s “blackout period” ahead of its July policy meeting. Traders anticipate a
near 97% chance the central bank increases interest rates later this month,
after pausing hikes in June, according to CME Group’s FedWatch tool.
Stock
market today: Live updates (cnbc.com)
Finally, hmm. What next, more
de-dollarisation? Time to hedge with a little more fully paid up physical gold
and silver, preferably held safely out of the larcenous reach of Uncle Sam and
John Bull.
IMF
Hints Allowing Countries to Use Chinese Yuan for Debt Repayment
July 15, 2023 Updated: July 15, 2023
The International Monetary Fund (IMF) has hinted that
it may accept the Chinese Yuan as a currency for countries to settle their
obligations with the IMF following Argentina’s recent debt repayment in yuan.
IMF spokesperson Julie Kozack confirmed on Thursday
that Argentina had paid off part of its debts—equivalent to $1.1 billion of the $2.7
billion that matured last month—with the IMF in Chinese currency.
“As we have stated in the past, the Argentine
authorities continue to remain current on their financial obligations to the
IMF,” Ms. Kozack said at a press briefing.
“The RMB is one of the five freely usable currencies that members can
and have used to settle their obligations with the IMF,” she added, referring
to the Chinese currency by its official name, the renminbi.
Ms. Kozack said that negotiations on the $44-billion program are still
ongoing. She denied that the IMF received a letter from China stating it would
allow Argentina to use a swap line with the Chinese Central Bank to pay off its
IMF dues.
“Our team has been working intensively with the Argentine authorities to
make progress toward the completion of the fifth review. And to help the
authorities address a very complex and challenging situation,” she said.
----Argentina’s Central Bank signed a deal with China last month to renew the 130
billion yuan ($18.4 billion) swap line for another three years, doubling the
amount of freely accessible funds from 35 billion yuan ($5 billion) to 70
billion yuan ($10 billion).
Argentina’s Ministry of Economy said the swap would
be in a single tranche and freely available for any type of financial
operation, adding that the country would look to promote more yuan spot and
future operations.
On June 29, the bank said it had incorporated the yuan as a currency
accepted for deposits in savings banks and checking accounts, signaling a
departure from the U.S. dollar as its sole official reserve currency.
“Financial entities will thus be enabled to open bank
accounts denominated in renminbi yuan,” the bank stated.
The move comes as the South American nation’s foreign
currency reserves plummeted due to a severe drought that has reduced grain
exports, its major source of dollar earnings, and the peso currency has
weakened under the weight of 109 percent annual inflation.
Ahead of general elections in October, Argentina’s
government is trying to rebuild reserves to make debt payments, cover trade
costs, and meet economic targets under a $44 billion loan program with the IMF.
Aside from Argentina, Brazil also signed an agreement
with China earlier this year that would allow them to conduct trade and
investments in their own currencies, further reducing the U.S. dollar’s
dominance.
Milton Ezrati, chief economist at Vested, a New
York-based communications firm, said the deal is an attempt to elevate the yuan as an
international currency, yet, “the yuan is a long way from an international
reserve currency such as the dollar.”
According to Mr. Ezrati, China does not have the
financial markets to support financial arrangements in yuan, which is one of
the requirements for a world reserve currency.
More
IMF Hints Allowing Countries to Use Chinese Yuan for
Debt Repayment (theepochtimes.com)
“How did you de-dollarise?”
“Two ways.”
“Gradually and then suddenly.”
With apologies to
Ernest Hemingway.
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.
The Bank of England
pledged rate rises would be 'gradual and limited' then threw a generation of
homeowners under the bus, says SIMON LAMBERT
July
14, 2023
Not so long ago, the Bank of England
repeatedly pledged interest rate rises would be ‘gradual and limited’. Instead,
they’ve been sudden and brutal.
Those reassuring words were aimed at
the generation of borrowers who had no choice but to borrow huge sums of money
if they wanted to own a home in the cheap money era of massively-inflated house
prices.
Given the choice many would have
opted for lower property purchase prices and higher mortgage rates, but that
wasn't on the homeowning menu.
The Bank of England put quite a lot
of effort into putting this don't worry narrative forward: stick ‘interest
rates gradual and limited’ into a search engine and you’ll see plenty of
results featuring Mark Carney and friends.
For more than a decade after the
financial crisis, interest rates were kept super low, cheap money was pumped
into the financial system, and property prices were allowed to become
increasingly detached from wages.
Many people were concerned about
this, but the mantra in return was not to worry, as in a low interest rate
world those super-sized mortgages were affordable - and rates would only rise
gently and slowly.
We now know that interest rate rises
have been the exact opposite of that.
We’ve gone from a 0.1 per cent to a 5 per cent base rate in 13 consecutive rate rises over just 18 months.
More
Covid-19 Corner
This section will continue until it becomes unneeded.
Today
a repeat, but a very important repeat. Why the censorship and cover up. Who
knew what and when?
Significant COVID-19 Vaccine
Study Censored by Medical Journal Within 24 Hours
Jul 13 2023
A systematic review of 325 autopsies showing COVID-19
vaccination caused or significantly contributed to 74 percent of deaths was
removed from The Lancet’s preprint SSRN server within 24 hours, adding to an
increasing number of censored studies on the potential harms of COVID-19
vaccines.
The study, published July 5, examined all autopsies published in peer-reviewed literature to determine whether COVID-19 vaccination caused or contributed to the person’s death.
Researchers searched all published
autopsy and necropsy reports related to COVID-19 vaccination through May 18,
2023, resulting in 678 studies. After implementing inclusion criteria, they
chose 44 papers containing 325 autopsy cases and one necropsy case. A panel of
three expert physicians independently reviewed each case to determine whether
COVID-19 vaccination was a direct cause or significant factor in each death.
Of 325 autopsies reviewed, 240
deaths, or 74 percent, were independently adjudicated as “directly due to or
significantly contributed to by COVID-19 vaccination.”
Findings showed the most affected
organ system in COVID-19 vaccine-associated death was the cardiovascular system
at 53 percent, followed by the hematological system at 17 percent, the
respiratory system at 8 percent, and multiple organ systems at 7 percent. Three
or more organ systems were affected in 21 cases. The mean time from vaccination
to death was 14.3 days—with most deaths occurring within a week of the last
vaccine dose.
The study results suggest a high likelihood of a causal link between COVID-19 vaccines and deaths in most cases. Yet, the government’s narrative is still that people do not die after COVID-19 vaccination, lead author Dr. Peter McCullough, a practicing internist, cardiologist, and epidemiologist, said in an interview on EpochTV’s “American Thought Leaders: Now.” “The striking cases were people who were perfectly healthy and had no other medical problems. The only new thing in their life was the vaccine, and they died with an obvious syndrome like a blood clot or heart damage—myocarditis.”
Within 24 hours, the study was removed and replaced with the following notice:
“This preprint has been removed by Preprints with the Lancet because the study’s conclusions are not supported by the study methodology.”
According to Dr. McCullough, the authors were not given an explanation for how their conclusions failed to meet the study methodology.
In an email to The Epoch Times, co-author Dr. Harvey Risch, a professor emeritus and senior research scientist in epidemiology at Yale, said he believes the paper was censored by The Lancet’s publisher, Elsevier, at the behest of the Trusted New Initiative (TNI), or a derivative organization of the TNI, based on the “study results providing strong evidence that some COVID-19 vaccine injections can have severe adverse effects leading to death.”
“This is my impression, given that the paper was removed at its preprint
stage, before scientific peer review, and without any other professional
scientific involvement in the censorship decision,” Risch added.
More
Significant COVID-19 Vaccine Study Censored by Medical
Journal Within 24 Hours (theepochtimes.com)
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.
ChatGPT owner in probe over risks around false answers
July 14, 2023
US regulators are probing artificial intelligence company OpenAI over
the risks to consumers from ChatGPT generating false information.
The Federal Trade Commission (FTC) sent a letter to the
Microsoft-backed business requesting information on how it addresses risks to
people's reputations.
The inquiry is a sign of the rising regulatory scrutiny of the
technology.
OpenAI chief executive Sam Altman says the company will work with
the FTC.
ChatGPT generates convincing human-like responses to user queries
within seconds, instead of the series of links generated by a traditional
internet search. It, and similar AI products, are expected to dramatically
change the way people get information they are searching for online.
Tech rivals are racing to offer their own versions of the
technology, even as it generates fierce debate, including over the data it
uses, the accuracy of the responses and whether the company violated authors'
rights as it was training the technology.
The FTC's letter asks what steps OpenAI has taken to address its
products' potential to "generate statements about real individuals that
are false, misleading, disparaging or harmful".
The FTC is also looking at OpenAI's approach to data privacy and
how it obtains data to train and inform the AI.
Mr Altman said OpenAI had spent years on safety research and months
making ChatGPT "safer and more aligned before releasing it".
"We protect user privacy and design our systems to learn about
the world, not private individuals," he said on Twitter.
In another tweet he said that it was important
to the firm that its "technology is safe and pro-consumer, and we are
confident we follow the law. Of course we will work with the FTC."
Mr Altman appeared before a hearing at Congress earlier this year,
in which he admitted that the technology could be a source of errors.
He called for regulations to be created for the emerging industry
and recommended that a new agency be formed to oversee AI safety. He added that
he expected the technology to have a significant impact, including on jobs, as
its uses become clear.
"I think if this technology goes wrong, it can go quite
wrong... we want to be vocal about that," Mr Altman said at the time.
"We want to work with the government to prevent that from happening."
The investigation by the FTC was first reported by the Washington
Post, which published a copy of the letter. OpenAI did not respond to a
BBCrequest for comment.
The FTC also declined to
comment. The consumer watchdog has taken a high profile role policing the tech
giants under its current chair, Lina Khan.
More
ChatGPT owner in probe over risks around false answers
- BBC News
Faced with the choice between changing one's mind and proving
that there is no need to do so, almost everyone gets busy on the proof.
John Kenneth Galbraith.
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