Baltic Dry Index. 1381 +41 Brent Crude 93.93
Spot Gold 1924 U S 2 Year Yield 5.02 +0.02
To err is human, but to really foul things up you need a computer.
Paul R. Ehrlich.
In the stock casinos, rising anxiety. Supposing the summer of 2023 was as good as the stock casinos get?
What if the global economy is rolling over led by China and the EUSSR?
What if the US auto strike, endorsed by President Biden, gets ugly?
What if high interest rates are only just now starting to bite the consumer economy?
What will happen next month to the US economy when student loans start to get repaid?
How high will crude oil prices get if Uncle Sam tries to replenish the US Strategic Petroleum Reserve depleted in President Biden’s bribe to the voters in last year’s mid-term elections?
What
will the Fed do next week?
Dow sheds nearly 300 points Friday, S&P 500 and
Nasdaq suffer second straight week of losses: Live updates
UPDATED FRI, SEP 15 2023 4:30 PM EDT
Stocks fell Friday as investors wrapped up a
volatile week ahead of the Federal Reserve’s policy meeting.
The Dow Jones Industrial Average slid
288.87 points, or by 0.83%, to 34,618.24. At its lows, the index completely
wiped out Thursday’s 332-point rally. The S&P 500 was
lower by 1.22% to 4,450.32. The Nasdaq Composite dropped
1.56% to 13,708.33.
The Dow closed out a positive
week, up by 0.12%. However, the S&P 500 and Nasdaq both suffered a second
straight week of losses, lower by 0.16% and 0.39%, respectively.
Information technology was the worst-performing
sector in the S&P 500, down nearly 2%. Adobe shares
fell more than 4% a day after the software firm posted
better-than-expected quarterly results. Shares of Arm Holdings were
lower by 4.2% one day after its successful public debut.
Auto stocks General Motors and
Stellantis N.V. rose Friday, while Ford inched lower. Thousands of members of
the United
Auto Workers went on strike after failing to reach a deal with
the automakers Thursday night.
Elsewhere, Lennar shares
slid 2.5%. The home construction firm posted third-quarter results that beat on
the top and bottom lines late Thursday.
On the economic front, the
University of Michigan’s consumer sentiment survey showed one-year inflation
expectations dropped to 3.1% in September, tied for the lowest since January
2021. Also, the five-year outlook fell to 2.7%, matching its lowest since
December 2020.
Wall Street is parsing through a
mixed batch of economic data ahead of the Fed’s policy decision, set to be
announced Sept. 20. The central bank is widely expected to hold rates steady
next week, but traders will seek insight into how policy makers are thinking
about inflation from here.
On Thursday, August’s producer
price index showed core
PPI was held in check last month, though the headline number
rose more than expected. Meanwhile, August’s consumer price index on Wednesday
showed core
CPI was slightly hotter than expected on a monthly basis.
More
Stock
market today: Live updates (cnbc.com)
Ray Dalio says to hold cash ‘temporarily’ — but don’t buy
debt and bonds
As concerns mount over rising interest rates
and inflation levels, billionaire investor Ray Dalio says he prefers to hold
cash for now, not bonds.
“I don’t want to own debt, you
know, bonds and those kinds of things,” the founder of Bridgewater Associates
said when asked how he would deploy capital in today’s investment environment.
“Temporarily, right now, cash
I think is good … and the interest rates are fine. I don’t
think [it] will be sustained that way,” Dalio told an audience at the Milken
Institute Asia Summit in Singapore on Thursday.
Dalio’s comments come as the
yield on the 30-day U.S.
Treasury bill climbs
above 5% while investors can get 4% on certificates of deposit and high-yield
savings accounts.
Dalio says the biggest mistake that most
investors make is “believing that markets that performed well are good
investments, rather than more expensive.”
When asked how
a new industry watcher should deploy capital, Dalio’s advice was: Be in the
right geographies, diversify, pay attention to the implications of disruptions
and pick asset classes that are creating new technologies and using them “in
the best possible way.”
Rising debt
Touching on
how to address the rising global debt, the hedge fund manager pointed out that
when debt accounts for a substantial share of a country’s economy, the
situation “tends to compound and accelerate … because you have to have interest
rates that are high enough for the creditor and not so high that they are
harming the debtor.”
“We’re at that turning point of acceleration.
But the real problem comes when individuals or investors don’t hold the bonds,
because it comes as a supply-demand, one man’s debts or another man’s assets,”
he explained.
Dalio
cautioned that investors will sell their bonds if they are not receiving real
interest rates that are high enough.
“The
supply-demand [imbalance] isn’t just the amount of new bonds. It’s the issue of
‘do you choose to sell the bonds?’” he explained.
More
Bridgewater's Ray Dalio: Hold cash for now, don’t buy debt and bonds (cnbc.com)
In other news, poor EUSSR. GB left only just in time.
Neo Communist Class War comes to the USA. Backed by President Biden.
German autos production under growing threat from China - IW study
September 15, 2023
BERLIN (Reuters) - Imports of Chinese vehicles and
parts to Germany jumped 75% in the first half of the year while trade the other
way slumped, showing the mounting pressure on Europe's biggest auto production
hub.
Several Chinese brands entered the German market
this year, the German Economic Institute (IW) said in a report seen ahead of
publication by Reuters, bringing the total to eight, though they still account
for just 1.5% of vehicles sold in the country.
Cars made in China by non-Chinese brands, such as
the all-electric iX3 from Germany's BMW's, also contributed to the rise in
imports.
The study comes days after the European Commission
launched an investigation into whether to impose punitive tariffs to protect EU
producers against cheaper Chinese electric vehicle (EV) imports it says benefit
from state subsidies.
It also shows exports of German vehicles and parts
to the world's second-largest economy slumped 21% in the first half of the
year, accounting for three quarters of the total decline in exports to China of
over 8%.
"The business model that used to support car
production in Germany - the intercontinental export of high-quality vehicles -
is coming under increasing pressure," wrote study authors Juergen Matthes
and Thomas Puls.
"German manufacturers have been relocating
more and more production to China for years, currently also increasingly in the
previously resistant premium class."
More broadly, vehicles are increasingly becoming an
Asian product, with nearly 60% of all vehicles produced in an Asian country
last year, compared with around 31% in 2000, they wrote.
Europe is losing significance for the sector, with
only Germany and Spain among the top ten auto producers worldwide, which in
2000 included also France, Britain and Italy.
German automakers' early entry into the Chinese
market in the 1980s is to thank for their relative resilience, the IW said.
Germany has at times been seen as a weak link in
Western attempts to decouple from China, given Berlin's strong business ties
with the Asian superpower which became Germany's single biggest trade partner
in 2016.
But Germany has over the past year joined the
broader push to reduce dependence on China - which its policymakers have dubbed
"de-risking".
The IW study, entitled "Is Derisking Beginning?",
said a breakdown of the broader 17% drop in German imports from China in the
first half of the year pointed to the first signs of a reduction of Germany’s
reliance on China.
More
German autos production under growing threat from
China - IW study (msn.com)
Analysis-Sweden braces as property storm clouds darken
September 15, 2023
STOCKHOLM (Reuters) - For months, Sweden's
government has sought to play down a property crisis that has throttled
confidence in the Nordic state, repeating a simple message: While some
companies are in trouble, the country is not.
Now Heimstaden Bostad, a $30 billion property
investor with swathes of homes from Stockholm to Berlin, is grappling with a
multibillion dollar funding crunch, which has rebounded on one of its owners -
the country's biggest pension fund
That undoubtedly raises the stakes for Sweden, the
European nation hardest hit by a global property rout triggered by the steep
rise in interest rates last year that abruptly ended a decade of virtually free
money.
Sweden is one of Europe's wealthiest states and the
biggest Nordic economy, but it has an Achilles Heel - a property market where
banks have lent more than 4 trillion Swedish crowns ($360 billion) to
homeowners. Weighed down by these home loans, Swedes are twice as heavily
indebted as Germans or Italians.
Earlier this year, the International Monetary Fund
flagged Sweden's historically high household borrowing coupled with debt-driven
commercial property firms and their dependence on local banks as a financial
stability risk.
The property crisis accelerated this month when
pension fund Alecta, which owns a 38% stake in Heimstaden Bostad, said Sweden's
biggest residential landlord needed cash and it may contribute.
Swedbank estimates the current shortfall for
Heimstaden Bostad could be roughly 30 billion crowns ($2.7 billion).
Sweden's financial regulator launched an inquiry
into why and how Alecta had invested $4.5 billion in the property giant, in the
first place. Its troubled investment accounts for 4% of its funds.
Christian Dreyer, a spokesperson for Heimstaden,
said it had made "good progress covering 2024 bond repayments", and
was "not reliant on immediate capital injection for meeting our
obligations".
But he also signaled that the company was open to
other support.
GOVT GETS READY
As the property crisis widens, Sweden's government
is readying for action while crossing its fingers that it will not be needed.
Earlier this year, Karolina Ekholm, Director
General of Sweden's Debt Office, said the government had a light debt load and
could afford to borrow more to intervene, addressing the possibility of giving
credit guarantees or subsidised loans.
----Sweden is
among the first European countries to find itself struggling as interest rates
climb because much of its property debt is short-term, making it a harbinger
for the wider region, where the rising cost of money has also rocked Germany.
Roughly half of Swedish homeowners have
floating-rate mortgages, meaning rate hikes quickly trigger higher bills for
them.
Its developers, meanwhile, often relied on
shorter-term loans or bonds that have to be replaced with pricier credit.
Heimstaden Bostad and other companies such as
struggling SBB grew quickly, in part by selling cheap short-term Eurobonds,
which has since become tougher.
More
Analysis-Sweden braces as property storm clouds darken
(msn.com)
UAW strike brings blue-collar vs. billionaire
battle to Detroit
DETROIT — The United Auto Workers strike is
bringing a blue-collar versus billionaire battle to the Motor City, just as UAW President Shawn Fain wanted.
The outspoken union leader has weaponized
striking — historically a last resort for the union — after
less than 24 hours into a work stoppage arguably better than any UAW president
has in modern times.
It wasn’t by accident.
Fain, a quirky yet emboldened
leader, has meticulously brought the UAW back
into the national spotlight after decades of near irrelevance.
He wants to represent not just union members but also America’s embattled
middle class, which UAW helped create.
To do so, he has leveraged a yearslong national
labor movement and a growing disgust for wealthy individuals and corporations
among many Americans — starting with his first time addressing the union’s more
than 400,000 members during his inauguration speech in March.
“We’re here to come
together to ready ourselves for the war against our only one and only true
enemy, multibillion-dollar corporations and employers who refuse to give our
members their fair share,” Fain said at the time. “It’s a new day in the UAW.”
Fain’s comments Friday morning as he joined UAW
members and supporters picketing
outside a Ford plant in Michigan — one of three facilities the
company is currently striking — echoed everything he said during that first
speech.
“We got to do what we got to do to
get our share of economic and social justice in this strike,” Fain said outside
the Ford Bronco SUV and Ranger pickup plant. “We’re going to be out here until
we get our share of economic justice. And it doesn’t matter how long it takes.”
---- National media and others really started
paying attention to Fain when he said the union would withhold a reelection
endorsement of President Joe
Biden, who has called
himself the “most pro-union president in history.” Fain and
Biden have spoken and met, but the union leader has not shown much support for
the president. In response to comments by the president Friday, Fain said:
“Working people are not afraid. You know who’s afraid? The corporate media is
afraid. The White House is afraid. The companies are afraid.”
While many past union leaders have
talked such talk, Fain has thus far delivered on his promises to members
without batting an eye — causing General Motors, Ford Motor and Stellantis to
go into crisis mode this week as the UAW follows through on that promise to
members.
More
UAW
strike brings blue collar battle, Bernie Sanders to Detroit (cnbc.com)
Biden wants automakers to give UAW workers more in strike
talks
By Steve
Holland and Nandita
Bose September 15, 202310:06
PM GMT+1
WASHINGTON, Sept
15 (Reuters) - U.S. President Joe Biden on Friday called on automakers to
concede more to workers who walked off the job at Detroit's largest car
companies, accusing them of enjoying record profits without sharing them fairly
with workers.
The
UAW strike at three factories owned by General Motors, Ford and Chrysler-owner
Stellantis kicked off the most ambitious U.S. industrial labor
action in decades.
"No one
wants a strike, but I respect workers' right to use their options under the
collective bargaining" system, Biden said. "I understand their
frustration."
The auto
companies have made some significant offers in negotiations so far, Biden said.
"But I
believe they should go further to ensure record corporate profits mean record
contracts for the UAW," he said, echoing sentiments by union leaders.
Labor
unions like the UAW - which represents 146,000 workers - are key
to Biden's game plan for winning reelection in 2024. He needs their
support to win key states like Pennsylvania and Michigan again, which stand to
bear the brunt of any major
strikes against carmakers.
more
Biden
wants automakers to give UAW workers more in strike talks | Reuters
The avoidance of taxes is the only intellectual pursuit that still carries any reward.
John Maynard Keynes.
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.
Gasoline
Prices Soar to US Seasonal Record
Fri, September 15, 2023 at 4:04 PM GMT+1
(Bloomberg) -- Gasoline
prices have surged to a record high for this time of year in the US,
jeopardizing the fight against inflation that’s dogged President Joe Biden.
Average regular gasoline now costs $3.866 a gallon,
a seasonal record on a trailing-12-months basis, according to data from the
American Automobile Association. Prices have risen by 7.8% in just eight weeks
in a rare late-summer rally.
Read More: Why Are US Gas Prices Going Up? When
Will They Fall?
The gains have been driven by increases in the
price of oil, which jumped about 20% in the past two months. Top analysts from
International Energy Agency and Organization of Petroleum Exporting Countries
have warned of a crude-market deficit through end-2023, underpinned by the
extension of production curbs by Saudi Arabia and Russia.
Gasoline costs already accounted for over half of
the increase in the August consumer price index. The continued escalation will
likely stoke inflation further while eroding consumer confidence.
Biden last year released a record amount of
emergency oil supply in order to tame gasoline’s record summertime surge. This
time, the administration is trying to refill the reserves as the vast caverns
sit empty, while Biden’s political rivals have seized on high pump prices as a
means of criticizing his climate policies.
It’s also unusual to see gasoline climbing at this
time of year, after the end of the summer-driving season that boosts US demand.
Compounding higher gasoline prices is a
simultaneous spike in diesel costs. Diesel prices often climb in the fall due
to seasonal consumption from farmers, who use the fuel for harvesting, and as
demand for heating climbs. But this year, the prices are still much higher than
usual.
US refiners have raised operations to near
pre-pandemic levels and gasoline stockpiles, though still below normal, rose by
the most in more than a year last week. The supply boost will likely fade in
the coming weeks as refiners enter fall maintenance — typically scheduled after
the peak summer gasoline season to avoid a price squeeze.
Gasoline
Prices Soar to US Seasonal Record (yahoo.com)
ECB's Villeroy: loose budgets could fuel more inflation
September 15, 2023
PARIS (Reuters) - Overly loose budget policies risk
fueling inflation at a time when the European Central Bank is fighting to bring
it lower, ECB policymaker Francois Villeroy de Galhau said on Friday.
The ECB raised its main interest rate on Thursday
to a record high 4% and signalled its latest hike was likely to be the last as
the euro zone's economy slows after a moving to bring inflation lower over more
than a year.
Speaking at a financial conference in Spain,
Villeroy declined to speak about the decision and urged governments to not
complicate the ECB's task as it seeks to bring inflation back to its 2% target
towards its 2% by 2025.
"Governments must avoid an overly expansionary
stance that would further fuel inflationary pressures. We therefore need a more
coordinated and realigned fiscal and monetary stance," Villeroy said.
A planned reform of the European Union's fiscal
rulebook, the Stability and Growth Pact, which is widely considered overly
complex and has often been flaunted, would be a welcome step in that direction,
Villeroy said.
EU governments aim to agree revisions to the rules
by the end of this year, but Berlin is digging in against some changes that
other governments say are necessary to give more flexibility.
ECB's Villeroy: loose budgets could fuel more
inflation (msn.com)
French
grocery chain adds ‘shrinkflation’ labels to products in bid to shame supplier
pricing
PUBLISHED FRI, SEP 15 2023 5:49 AM EDT
French grocery chain Carrefour has taken the unusual step of adding labels to its
products that have recently shrunk in size but have ramped up in price.
The move — both in stores and on its website —
looks to pile pressure on its suppliers that have increased prices for the
chain, despite raw material prices having recently eased.
Carrefour added the “shrinkflation”
warning stickers to a range of products, from Lipton Iced Tea and Pepsi, to boxes of Lindt chocolates and baby milk powder.
“Obviously, the aim in stigmatizing these products
is to be able to tell manufacturers to rethink their pricing policy,” Stefen
Bompais, a director of client communications at Carrefour, said in an interview
with Reuters.
Carrefour did not immediately respond to a CNBC
request for comment.
Carrefour marked 26 products, according to
Reuters, with a label reading: “This product has seen its volume or weight fall
and the effective price by the supplier rise,” as translated by the news
agency.
The move was taken as brands are soon to negotiate
their place with certain retailers, Reuters said.
Carrefour announced a new strategic plan to tackle
the current macroeconomic, geopolitical and climate challenges in November
2022, which is based around the idea of making its products accessible to its
customer base.
Cases of shrinkflation tend to increase in high inflation environments, Edgar Dworsky, founder of Mouse Print, a website that
tracks instances of shrinkflation in groceries, told CNBC in April. But these
changes don’t tend to be announced by manufacturers, making it difficult for
consumers to notice the changes, he said.
French grocery chain adds 'shrinkflation' labels to
products (cnbc.com)
Covid-19
Corner
This
section will continue until it becomes unneeded.
No Covid update again. Today, an update
on another virus that might just become the next virus to become a more serious
animal to human spread virus, more dangerous than SARS-CoV-2.
Nipah: What do we know about virus spreading in India's
Kerala?
September
14, 202310:20 AM GMT+1
NEW DELHI, Sept 14
(Reuters) - India's southern state of Kerala shut some schools and offices this
week as officials raced to halt the spread of the deadly Nipah virus, after
it killed two
people in the fourth outbreak since 2018.
Here is what we know about the virus:
WHERE DID THE VIRUS COME FROM?
The Nipah virus was first identified in
1998 during an outbreak of illness among pig farmers in Malaysia and Singapore.
It is able to infect humans directly
through contact with the bodily fluids of infected bats and pigs, with some
documented cases of transmission among humans.
Scientists suspect Nipah has existed
among flying foxes for millennia and fear a mutated, highly transmissible
strain will emerge from bats.
WHAT ARE THE SYMPTOMS AND HOW IS IT TREATED?
There are no vaccines to prevent or
cure the infection, which has a mortality rate of between about 70%. The usual
treatment is to provide supportive care.
Infected people initially develop
symptoms that include fever, respiratory distress, headaches, and vomiting, the
World Health Organization (WHO) says. Encephalitis and seizures can also occur
in severe cases, leading to coma.
The virus is on the WHO's research and
development list of pathogens with epidemic potential.
WHERE WERE THE EARLIER OUTBREAKS?
The 1998 outbreak in Malaysia and
Singapore killed more than 100 people and infected nearly 300. Since then, it
has spread thousands of miles, killing between 72% and 86% of those infected.
More than 600 cases of Nipah virus
human infections were reported between 1998 to 2015, WHO data shows.
A 2001 outbreak in India and two more
in Bangladesh killed 62 of 91 people infected.
In 2018, an outbreak in
Kerala claimed 21 lives, with other outbreaks in 2019 and 2021.
Parts of Kerala are among
those most at risk globally for outbreaks of bat viruses, a Reuters
investigation showed in May.
Nipah: What do we know about virus spreading in
India's Kerala? | Reuters
Technology Update.
With events happening fast in the
development of solar power and graphene, I’ve added this section.
Prototype prefab enhanced by graphene
prototype
flatpack bungalow made from recycled materials is undergoing testing at a
research facility in Lancashire.
What
makes Vector Homes different from other flatpack homes is their use of
graphene.
By
incorporating graphene into the structures, the panels used in the construction
of a Vector home have improved tensile strength, a reduced flame spread and
increased UV resistance.
Vector
Homes has been set up in Manchester by a pair of materials engineers with a
background in graphene research and development. Chief executive Nathan Feddy
worked in the nanocomposites division of the Graphene Engineering Innovation
Centre; chief technology officer Liam Britnell was application manager at the
Graphene Engineering Innovation Centre.
Vector
has worked with the University of Manchester’s Graphene Engineering Innovation
Centre to develop ways of incorporating the material into housing systems.
A
prototype Vector house is now being assessed in the University of Salford’s
Energy House 2.0 to test the thermal properties and its efficiency in different
climates.
The
prototype is a one-bedroom bungalow, measuring 40 sqm, constructed using
recycled steel and
plastics, as well as graphene and other advanced materials.
Vector’s
ambition is to create an affordable, energy efficient home with low-embodied
carbon materials, infra-red heating, solar cells, breathable mould-resistant
plaster and render, and embedded technology to provide smart environmental
controls that efficiently measure and control the temperature, humidity and air
quality in each room.
Its
homes are also designed for rapid production and assembly. Vector hopes to mass
produce homes in a range of shapes and sizes that are sold as flatpack kits.
Launched earlier this year, the £16m Energy House
2.0, on the University of Salford’s Peel Park Campus, is helping to drive
innovation in the housing sector already, through work with house-builders
Barratt and Bellway, and manufacturer Saint-Gobain. It can recreate
temperatures from -20C to 40C, as well as recreating snow, wind, rain and solar
energy to put the Vector home through its paces.
Vector Homes has so far received backing from SFC
Capital, GC Angels, the Greater Manchester Investment Fund which is the
investment arm of the Greater Manchester Combined Authority, Innovate UK, the
European Regional Development Fund and social housing investment firm HSPG.
More
Prototype prefab enhanced by graphene
(theconstructionindex.co.uk)
This weekend’s music
diversion. The very talented Herr Fasch’s version of fireworks music. Performed for the marriage in 1745 of the
minor German Princess who would go on to become Catherine the Great of Russia.
Mr. Fasch beats Handel to fireworks music by 4 years.
Approx. 4 minutes. Approx.
1.30 minutes. Approx. 3 minutes. Approx. 1.30 minutes.
Johann
Friedrich Fasch "Royal Fireworks Music," FWV L:D13 - 1. Allegro
Johann Friedrich Fasch "Royal Fireworks
Music," FWV L:D13 - 1. Allegro - YouTube
Johann
Friedrich Fasch "Royal Fireworks Music," FWV L:D13 - 2. Andante
Johann Friedrich Fasch "Royal Fireworks
Music," FWV L:D13 - 2. Andante - YouTube
Johann
Friedrich Fasch "Royal Fireworks Music," FWV L:D13 - 3. Allegro
Johann Friedrich Fasch "Royal Fireworks
Music," FWV L:D13 - 3. Allegro - YouTube
Johann
Friedrich Fasch "Royal Fireworks Music," FWV L:D13 - 4. Tempo di
Menuet
Johann Friedrich Fasch "Royal Fireworks
Music," FWV L:D13 - 4. Tempo di Menuet - YouTube
This weekend’s chess
update. Approx. 7 minutes.
Sacrifice
BOTH Rooks and the Queen!
Sacrifice BOTH Rooks and the Queen! - YouTube
No
weekend the maths update this week. This week vital language tips for Brits and
Yanks intending to travel in each other’s country. Approx. 21 minutes.
100+
Differences between British and American English | British vs. American
Vocabulary Words
Ronald Reagan.
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