Baltic Dry Index. 1145 +09 Brent Crude 85.37
Spot
Gold 1934 US 2 Year Yield
4.76 -0.02
August 8,1786 US Congress
unanimously chooses the dollar as the monetary unit for the United States of
America.
In the stock casinos, disbelief that the global economy just doesn’t get the incredible optimism of the stock casinos.
Bubble on, AI hype will soon turn around an increasingly stormy looking real economy, the punters think.
I think the latest casino bubble bursts in H2
23, just possibly by the end of this month.
Asia markets mixed as China trade tumbles
more than expected
UPDATED MON, AUG 7 2023 11:35 PM
EDT
Asia-Pacific markets were mixed on Tuesday as
China’s July trade came in lower than expected.
China saw a 14.5% year-on-year
drop in exports, while imports came in 12.4% lower year-on-year. Economists
polled by Reuters expected a 12.5% slide in exports and a 5% drop in imports.
Hong Kong’s Hang Seng index slipped
0.87%, while mainland Chinese markets were more mixed. The Shanghai Composite fell
0.2%, but the Shenzhen Component was
marginally up.
Japan’s Nikkei 225 rose
0.31%, while the Topix was up 0.32% as the country’s household spending
remained in negative territory for the fourth straight month. Overall household
spending fell 4.2% year on year in June, compared with 4% in May, official data
showed.
In Australia, the S&P/ASX 200 climbed
0.19%, while South Korea’s Kospi inched
up marginally and the Kosdaq slipped 0.43%.
Overnight in the U.S., all three major indexes
gained as investors continue to digest better-than-expected earnings results.
Roughly 85% of S&P 500 stocks have reported quarterly results, and nearly
80% of them have beaten Wall Street’s expectations, according to FactSet.
The 30-stock Dow surged nearly
1.2%, for its best day since June 15. Meanwhile, the Nasdaq Composite added
0.6%, and S&P 500 closed
higher by 0.9%. Both the Nasdaq and the S&P500 broke four-straight sessions
of losses.
Asia markets mixed as
China trade tumbles more than expected (cnbc.com)
China reports double-digit plunge in July
exports and imports, missing expectations
BEIJING — China said
Tuesday that exports fell by 14.5% in July from a year ago, while imports
dropped by 12.4% in U.S. dollar terms.
That’s worse than
what analysts had expected.
A Reuters poll
predicted a 12.5% decline in exports in July from a year ago, in U.S. dollar
terms. Imports were expected to have dropped by 5% during that time, according
to the poll.
China’s exports to
the U.S. plunged by 23.1% year-on-year in July, while those to the European
Union fell by 20.6%, CNBC analysis of customs data showed. Exports to the
Association of Southeast Asian Nations fell by 21.4%, according to the data.
China’s imports from
Russia fell by 8.1% in July from a year ago, the data showed.
A slowdown in U.S.
and other major economies’ growth has dragged down Chinese exports this year.
Meanwhile, China’s domestic demand has remained lackluster.
Chinese imports of
crude oil dropped by 20.8% in July from a year ago, while imports of integrated
circuits fell by nearly 17%.
July’s decline in
trade adds to recent weakness in China’s exports and imports.
On a year-to-date
basis, China’s exports for the first seven months of the year fell by 5% from a
year ago, while imports dropped by 7.6% during that time.
Among the few
higher-value export categories that saw a significant increase in the first
seven months of the year were cars, refined oil and bags, suitcases and similar
receptacles.
For imports, paper
pulp, coal products and edible vegetable oil were among the categories seeing
significant growth in the January to July period from a year ago.
Exports remain an important part of China’s
overall economic activity, although its share has fallen in recent years.
An official measure of Chinese
manufacturing activity posted a fourth-straight
month of contraction in July.
A similar survey from Caixin for
July found that manufacturers’ new
export business contracted at the fastest pace since September 2022.
China
reports double-digit plunge in July exports and imports, missing expectations
(cnbc.com)
Finally, what drag effect will Yellow’s bankruptcy have on the US economy?
Moody’s downgrades US banks.
Yellow Files for Bankruptcy, Blames Union for Downfall
August 7, 2023
U.S. trucking firm Yellow Corp.
filed for Chapter 11 bankruptcy protection on Aug. 6 after the company buckled
under pressure from a mounting debt load as well as a standoff with an employee
union.
“It is with profound
disappointment that Yellow announces that it is closing after nearly 100 years
in business,” Yellow CEO Darren Hawkins said in an Aug. 6 statement. “Today, it
is not common for someone to work at one company for 20, 30, or even 40 years,
yet many at Yellow did. For generations, Yellow provided hundreds of thousands
of Americans with solid, good-paying jobs and fulfilling careers.”
The Nashville, Tennessee-based
nearly 100-year-old company's bankruptcy filing puts about 30,000 workers at
risk at a time when the freight industry is already grappling with slumping
volumes.
The company is a dominant
player in the "less-than-truckload" segment that hauls cargo for
multiple customers on a single truck.
Its clients include large
retailers such as Walmart and Home Depot, manufacturers, and Uber Freight. Some
companies had paused shipments to Yellow because of fears that they could be
lost or stranded if the trucking firm went bankrupt.
Prior to its demise, Yellow,
one of the largest U.S. trucking companies, held roughly 8 percent to 10
percent of the market share, per brokerage firm TD Cowen.
More
Yellow
Files for Bankruptcy, Blames Union for Downfall | The Epoch Times
Moody’s
Cuts US Banks on Mounting Funding Costs, Office Exposure
Tue, August 8, 2023 at 2:23 AM GMT+1
(Bloomberg) -- Moody’s Investors Service lowered credit ratings for 10 small and midsize US banks and said it may downgrade major lenders including U.S. Bancorp, Bank of New York Mellon Corp., State Street Corp., and Truist Financial Corp. as part of a sweeping look at mounting pressures on the industry.
Higher funding
costs, potential regulatory capital weaknesses and rising risks tied to
commercial real estate loans amid weakening demand for office space are among
strains prompting the review, Moody’s said in a spree of notes late Monday.
“Collectively,
these three developments have lowered the credit profile of a number of US
banks, though not all banks equally,” it wrote in some of the assessments.
Firms that had
ratings cut included M&T Bank Corp., Webster Financial Corp., BOK Financial
Corp., Old National Bancorp, Pinnacle Financial Partners Inc., and Fulton
Financial Corp.
Northern Trust
Co. and Cullen/Frost Bankers Inc. are also under review for downgrades.
And Moody’s
adopted a “negative” outlook for 11 lenders including PNC Financial Services
Group, Capital One Financial Corp., Citizens Financial Group Inc., Fifth Third
Bancorp, Regions Financial Corp., Ally Financial Inc., Bank OZK and Huntington
Bancshares Inc.
----“Rising
funding costs and declining income metrics will erode profitability, the first
buffer against losses,” Moody’s wrote in a separate note explaining the moves.
“Asset risk is rising, in particular for small and mid-size banks with large
CRE exposures.”
Some banks
have curbed loan growth, which preserves capital but also slows the shift in
their loan mix toward higher-yielding assets, Moody’s said.
Banks that
depend on more concentrated or higher levels of uninsured deposits are more
exposed to these pressures, especially banks with high levels of fixed-rate
securities and loans.
Moody’s Cuts US Banks on Mounting Funding Costs, Office Exposure (yahoo.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.
China can no longer
'extend and pretend' on municipal debt
By Kevin Yao and Samuel Shen August
7, 20237:59 AM GMT+1
BEIJING, Aug 7 (Reuters)
- China's promised "basket of measures" to defuse local government
debt risks is likely to include special bond issuance, debt swaps, loan
rollovers, and something Beijing really loathes: dipping into the central
budget.
Local
governments are fundamental to China's economy, with Beijing tasking provincial
and city officials with meeting ambitious growth targets. But after years
of over-investment in infrastructure, plummeting returns from land
sales and soaring COVID costs, economists say debt-laden municipalities now
represent a major risk to China's economy.
Chinese
leaders last month pledged, without detailing, to help ease their debts, signalling
worries over a potential chain of municipal debt defaults destabilising the
financial sector.
Economists took
that message as being more constructive than in April, when Communist Party
leaders demanded "strict control" of local debts. The implication,
they say, is that Beijing has realised it needs to urgently throw cash at the
problem.
That could
represent a major breakthrough in finding a way out of China's municipal debt
crisis, with Beijing having for years demanded that local administrations sort
themselves out.
"The local
debt problem is complex so you cannot simply say you don’t want to take
responsibility," said Guo Tianyong, professor at the Central University of
Finance and Economics in Beijing, explaining the politburo's directions.
The extent of any
central government involvement, and any conditions attached to it, are still
subject to debate, two policy advisers told Reuters. Whether the package of
measures will be a short-term or multi-year plan also remains unknown.
These details
will be key for investors to gauge how decisive and long-lasting Beijing's
solution will be.
More
China can no longer 'extend and pretend' on municipal
debt | Reuters
German industrial output falls further in June
August 7, 2023
BERLIN
(Reuters) - German industrial production dropped more strongly than forecast in
June, according to data released on Monday, underlining the challenges faced by
manufacturing amid a downturn in Europe's largest economy.
Production
fell by 1.5% compared with the previous month, the federal statistics office
said on Monday. Analysts polled by Reuters had predicted a 0.5% decline.
The office
offers more detailed data on its website.
"The
minus in June provides a taster for the poor production figures that are on the
horizon for the coming months," said Commerzbank chief economist Joerg
Kraemer.
He pointed to
a downward trend in orders and indications that companies had already worked
off their order backlogs from the COVID-19 pandemic.
The Germany's
manufacturing sector has already had a difficult year so far due to dwindling
orders, sluggish output and high prices, with the HCOB final Purchasing
Managers' Index (PMI) for manufacturing falling for a sixth consecutive month
in July.
Kraemer said
the German economy was expected to contract again in the second half of 2023.
Germany's
winter recession ended in the second quarter, when GDP stagnated, according to
preliminary data.
German industrial output falls further in June
(msn.com)
Covid-19 Corner
This section will continue until it becomes unneeded.
3 Asian countries still
have Covid-19 entry requirements in August 2023 - here’s which ones
August
7, 2023
- While
most countries in Asia have now dropped Covid-19 entry requirements,
mainland China, Myanmar and Iran are holding out - here are their
respective rules
- Some
countries that have dropped measures still require travellers to submit a
health declaration form upon arrival, such as the Philippines
It has
been more than three years since the World Health Organization declared the
Covid-19 outbreak a public health emergency of international concern, and most
of the world has rebounded from complete lockdowns to restriction-free travel.
But
while most countries have dropped mandates for proof of vaccination and
negative test results, there are still a number that have Covid-19 entry
requirements in effect.
Three
of those are in Asia (at the time of writing), so be sure to pay close
attention to their respective rules if you're planning on visiting.
1. Mainland China
Although
quarantine and vaccine requirements have been lifted for visitors to mainland
China, all arrivals are still required to take either a PCR or RAT test 48
hours before their flight.
They then have
to declare a negative test result by filling in the Health Declaration Form on
the China Customs website, through the China Customs app, or via China Customs'
WeChat account.
Airlines will
no longer check for negative test results, but customs officials may conduct
inspections. Those who enter with an abnormal health declaration, fever, or
other Covid-19 symptoms may be required to undergo further testing and medical
investigation.
More
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.
Solar power to the rescue as Europe's energy system weathers extreme heat
07 August,2023
BRUSSELS/LONDON (Reuters) – A major increase in solar power generation
in southern Europe played a leading role in averting energy shortages during
the heatwaves of recent weeks when temperatures broke records and drove
unprecedented demand for air conditioning.
Solar power is particularly suited to coping with summer heat as the
sun's radiation is strongest around the hottest part of the day, when
electricity demand for cooling is also at its highest.
"The very significant growth in solar basically compensates for the
peaks that are caused by air conditioning," Kristian Ruby, secretary
general of electricity industry group Eurelectric, said of the situation in
Spain.
Spain and Greece are among the countries that have installed many more
solar panels in the face of record high energy prices last year and the quest
for increased energy security linked to Russia's invasion of Ukraine.
Spain added a record 4.5 gigawatts of solar photovoltaic capacity last
year, resulting in solar energy output in July - typically one of the sunniest
months - that was higher than any month to date, Spanish electricity grid
operator Red Electrica said.
Data from Ember showed solar provided almost 24 per cent of Spain's
electricity in July this year, up from 16pc in July 2022.
When soaring temperatures and demand for cooling led to a peak in
Sicilian power demand on July 24, nearly half of the excess demand - which
totalled 1.3 GW - was covered by solar, Refinitiv data show. Sicily's solar
production last month was more than double that of July 2022.
"Without the additional solar, the system stability impact would
have turned out much worse," Refinitiv power analyst Nathalie Gerl said.
Solar alone cannot hold up grids under severe strain. Catania, below
Mount Etna in eastern Sicily, has faced power and water supply cuts that local
officials blamed in part on the heat. In Athens, power grid operator IPTO said
wildfires had damaged sections of the electricity grid.
But higher solar output helped to satisfy demand in both countries.
During Greece's peak power demand this year, also on July 24, solar
photovoltaics covered 3.5GW of the total 10.35GW demand, grid operator IPTO
said.
Even in cooler and less sunny western countries such as Belgium, solar
energy has covered more than 100pc of the extra energy needed during midday
spikes in power demand.
Despite its fast growth, solar is still a relatively small share of the
power mix in most countries, where sources including wind, gas, coal and
nuclear power typically cover the bulk of demand over the year.
Analysts say a second factor has helped to keep Europe's energy systems
running this summer: overall, power demand has been relatively low.
That has been the case since Europe's energy crisis last year, when
Russia cut gas deliveries to Europe. Energy prices in Europe are still high
compared with historic levels - and consumers and industries have responded by
using less power.
Extreme heat this summer has broken through this trend at times. But
overall, demand has been below normal - Italy's average hourly power use in
July was 4.4pc lower than in July 2022, while Spain's was down by 3.6pc,
Refinitiv data show.
"The only reason why this has been bearable is the low power demand
environment that we're currently in," Refinitiv's Gerl said.
More
Solar power to the rescue as Europe's energy system
weathers extreme heat - Business - Dunya News
"We contend
that for a nation to tax itself into prosperity is like a man standing in a
bucket and trying to lift himself up by the handle."
Sir Winston Churchill.
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