Baltic Dry Index. 1945 +10 Brent Crude 90.89
Spot Gold 1933 U
S 2 Year Yield 5.04 -0.02
“I know not with what weapons World War III will be fought, but World War IV will be fought with sticks and stones.”
Albert Einstein
In the stock casinos, nervousness ahead of what comes next in our new world order of escalating wars.
The latest terrorist war, started one week ago by the terrorists running Gaza, is about to enter its second week. An Israeli incursion into north Gaza is widely expected this weekend.
How this ends up affecting commodity and stock markets, if at all, nobody knows, but there is a general assumption that that it isn’t positive and might be calamitous.
Time to scale back risk. Look away from that oil price and gold price now.
European stocks close lower while investors assess
strong U.S. earnings
UPDATED FRI, OCT 13 2023 11:51 AM EDT
European stock markets closed lower Friday
afternoon as global sentiment falters.
The regional Stoxx 600 ended
1% lower, with tech stocks dropping 2.5%. Oil and gas stocks made the biggest
gains, by 1.2%, as crude prices rose
sharply.
Despite the sharp rise in geopolitical
volatility resulting from the outbreak of the devastating Israel-Hamas
war, stocks have performed strongly this week, with the Stoxx 600 currently
on track for its best week since July.
In the U.S. both producer
price and consumer
price index readings came in slightly higher than expected
Wednesday. JPMorgan Chase and Wells Fargo started earnings season for
major financial firms on Friday with higher-than-anticipated
profit and revenue numbers for the third quarter.
Asia-Pacific stocks
closed lower as the consumer price index in China — where the concern is
deflation — came in flat, below estimates for 0.2% growth.
U.S.
stocks were slightly lower Friday as traders pored through the
major bank earnings, and Treasury yields pulled back.
European
markets open to close: stocks, inflation, oil (cnbc.com)
Mysterious rise in US
Treasury yields perturbs markets
Fri, October 13, 2023 at 2:59 AM GMT+1
The surge in US treasury yields has sparked much
anxiety among investors, in part because there is no easy explanation for the
rise.
On Friday, the yield on the 10-year US Treasury
note climbed to 4.88 percent for the first time since 2007, while the 30-year
offering reached 5.05 percent, also a 16-year peak.
Both have edged back in recent days, due mainly to
elevated geopolitical risk, analysts say, although yields remain high.
The most oft-cited justification for the rise has
been expectations that monetary policy will stay hawkish in response to the
resilient US economy.
"The Fed expectations have been
shifting," said John Canavan, analyst at Oxford Economics.
"From the Fed's perspective, we're seeing
stronger than expected economic growth, some increase in inflation and
uncertainty, particularly as oil prices surge again."
While two-year US treasuries are considered the
closest proxy to Fed interest rates, the market has been unsettled by the jump
in yields of longer-run bonds of five, 10 or 30 years.
"Something is happening in the bond market and
nobody fully understands how you kind of break it down," said Adam Button
of ForexLive.
Karl Haeling of LBBW pointed to increased bond
issuance by the US Treasury Department, saying markets are increasingly worried
that the US "fiscal situation is moving on a long-term unsustainably bad
trajectory."
For Yardeni Research, "the bond market has
changed recently and disconcertingly," the consultancy said in a recent
posting.
Perplexing moves by US treasuries in response to
economic news "suggest a shift in bond investors' focus from what monetary
policymakers may do, to rising alarm about what fiscal policymakers are
doing."
"The worry is that the escalating federal
budget deficit will create more supply of bonds than demand can meet, requiring
higher yields to clear the market," added Yardeni Research.
But not everyone is on board with this perspective.
"We can blame higher long-run yields on many
things, but deficits are not one of them," said Nick Colas of DataTrek Research.
- Fewer buyers -
Yet another factor in the market shift has been a
slowing in demand.
"Central banks are no longer
buying bonds, they are selling them," Neil Wilson, chief market
analyst at Markets.com, said of the retreat.
After multiple rounds of quantitative easing, the
Fed has been in a belt-tightening mode, reducing the size of its balance sheet
and not replacing bonds that reach maturity with new purchases.
But Peter Boockvar, chief investment officer of
Bleakley Financial Group, said that the US central bank may not be able to pull
of "quantitative tightening," noting that the Fed reversed course in
2019 following turbulence in markets.
A "failure" by the Fed means "things
cracking in the financial system well before the Fed's balance sheet shrinks by
much and we're left with this perpetually large Fed presence in the
markets."
The US central bank might be forced to resume
quantitative easing "just to help absorb the massive amount of
Treasury supply coming down the DC pike," Boockvar said.
"Someone else has to buy the debt and there is
a lot more of it now," Wilson said. "This can only result in lower
prices, higher yields."
The group that has stepped back from US Treasury
purchases includes China, which is managing a difficult economic recovery after
Covid-19 lockdowns, and Japan, which has been buying domestic bonds to suppress
yields, said Jose Torres of Interactive Brokers.
"We're going to have a debt crisis in this
country," Ray Dalio, head of the hedge fund Bridgewater Associates, warned
in an interview on CNBC.
More
Mysterious
rise in US Treasury yields perturbs markets (yahoo.com)
In never-ending war news, man’s inhumanity to man has no
limit. In the Hamas terrorist war on
Israel, in an eye for an eye response, Israel’s government seems to be fighting
terror with terror encouraged by Biden and Blinken. Nothing good lies down this
path, I suspect.
‘There is nowhere to hide from the bombs’: Civilians
trapped in Gaza can’t escape Israel’s siege
How do you run from bombs when all your borders are sealed off?
In the Gaza Strip, a small stretch of land blockaded off with concrete
walls and barbed wire fences and whose last remaining border crossings have
been shut, survival is increasingly a game of chance.
“It’s insane and brutal — I can’t believe they’re doing this to the
whole population. The amount of airstrikes are massive,” Omar, a Gazan
development worker with two young children, told CNBC via voice note. “We’re OK
for now but it’s very scary, and with each bomb we feel it’s going to be our
turn.” Omar asked that only his first name be used out of concern for his
family.
Without bomb shelters, people try to hide in hallways, away from
windows, in schools, or even in the street alongside piles of rubble. But those
spots aren’t safe either, Palestinians in Gaza say.
The Gaza Strip is under its sixth day of bombings by the Israeli air
force since Oct. 7, when members of Hamas, the Palestinian militant group that
governs Gaza, launched an unprecedented terror attack on southern Israel. The
highly coordinated assault killed more than 1,200 people, wounded 2,800, and
saw Hamas take some 150 hostages, both civilians and soldiers, in what has been
called “Israel’s 9/11.”
Since that day, Israeli officials have vowed to obliterate Hamas using any
means necessary as the group continues firing rockets at Israel. But some of
the tactics, which are incurring an already dramatic civilian cost, are classified as war crimes under the Geneva Convention, human
rights groups warn.
The Israeli hostages are meanwhile still
trapped in Gaza, an act by Hamas the U.N. has also condemned as a war crime.
The organization has also strongly condemned the brutal crimes committed by
Hamas, and the “deliberate and widespread” killing of innocent civilians.
At the time of writing, the Palestinian
Health Ministry reports that more than 1,500 people in Gaza have been killed with
6,600 injured.
‘A living hell’
The public water supply has completely run
out, Omar said. “We have one tank which we’re consuming from. We will run out
of water at some point but we’re minimizing the consumption to the very
minimum.”
Earlier in the week, his father got an
automated call from the Israel Defense Forces giving him a five-minute warning
to leave his home as the building was about to be bombed.
“Five minutes to leave your house. You can
have a final look and that’s it,” Omar recounted, sending photos over WhatsApp
of an apartment building reduced to a mountain of gray debris. “This is my
family’s house, the house of all my childhood memories.”
On Friday, the IDF issued a 24-hour deadline for the 1.1 million residents
of northern Gaza to evacuate to the south, with Israel expected to launch a
large-scale ground offensive in pursuit of Hamas. The U.N. warned that it is “impossible for such a movement
to take place without devastating humanitarian consequences.”
More
Civilians
trapped in Gaza can't escape Israel's siege (cnbc.com)
Finally, a warning from America’s top bankster. But if
this is “the most dangerous time in decades,” why did he boost artificially “profits” by reducing provision for credit
losses?
Provisions for credit
losses fell 10 per cent year-on-year to $1.4bn. Most analysts
had predicted that JP Morgan would increase the funds it sets aside in
case loans turn bad.
JP Morgan boss Jamie Dimon warns world is
witnessing ‘most dangerous time in decades’
FRIDAY 13 OCTOBER 2023 12:30 PM
Jamie Dimon, chief executive of JP Morgan, said the early 2020s were
shaping up to be “the most dangerous time the world has seen in decades” as the
Wall Street banking giant reported another increase in profit.
Citing geopolitical tensions, “extremely high government debt levels” and the unknown longer-term consequences of quantitative tightening in reducing liquidity, Dimon suggested the global economy faced difficult years ahead.
“The war in Ukraine compounded by last week’s attacks on Israel may have far-reaching impacts on energy and food markets, global trade, and geopolitical relationships,” he warned.
However, he said that
“US consumers and businesses generally remain healthy” even if consumers are
spending down excess cash buffers accumulated during the pandemic.
Dimon’s comments came after JP Morgan reported
net income of $13.2bn in the third quarter, 35 per cent higher than the same
period last year.
Revenue meanwhile climbed 22 per cent to
$39.9bn largely thanks to a 30 per cent increase in net interest income. Across
the year as a whole JP Morgan expects net interest income of $88.5bn, up from
previous guidance of around $87bn, and expenses of around $84bn.
Income attributable to First Republic in the
quarter was $1.1bn. JP Morgan acquired
the bank in April after depositors pulled around $100bn from the bank.
Provisions for credit losses fell 10 per cent
year-on-year to $1.4bn. Most analysts
had predicted that JP Morgan would increase the funds it sets aside in
case loans turn bad.
“We acknowledge that these results benefit from our over-earning on both
net interest income and below normal credit costs, both of which will normalize
over time,” Dimon said.
The slow performance in investment banking continued, with profit down
12 per cent year on year. Investors are looking out for signs of the green
shoots after many bank bosses suggested dealmaking would pick up again towards
the end of this year.
Jamie Dimon: World is seeing 'most dangerous time in decades' (cityam.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.
Fed Minutes Show One More Rate Hike, Then
Higher Interest Rates for 'Some Time'
At
their latest policy meeting, Federal Reserve officials were leaning towards one
more rate hike and then holding rates high for 'some time.'
10/12/2023 Updated: 10/12/2023
Newly released
records of discussions among Federal Reserve policymakers show that they expect
one more interest rate hike and then they'll hold rates high for "some time,"
although a recent surge in long-term Treasury yields may have changed that
calculus.
Minutes from the central bank's most recent
September meeting of the rate-setting Federal Open Market Committee
(FOMC), released on Oct. 11, show
that a "majority" of officials believe that one more rate hike
"would likely be appropriate" to get inflation closer to the Fed's 2
percent target.
At that
meeting, FOMC members opted to keep rates unchanged within a range of 5.25 to
5.5 percent—the highest level in 22 years.
By
contrast, "some judged it likely that no further increases would be
warranted," the minutes read, which is a view that aligns closely with
market expectations that put the odds of another
pause at the FOMC's next meeting in November at more than 90 percent.
Before the release of the minutes, a recent
surge in longer dated U.S. Treasurys—which made government borrowing more
expensive—prompted several Fed officials to suggest that the central bank may
leave rates unchanged in November.
Since late July, the yield on the benchmark 10-year Treasury note jumped
from about 4 percent to about 4.8 percent—a 16-year high.
Mortgage rates, which are closely tied to the
10-year Treasury yield, have risen to 7.5 percent, a 23-year high, according to
Freddie Mac.
Corporate bond
yields, too, have risen, raising borrowing costs for businesses.
More
Fed Minutes Show One More Rate Hike, Then Higher
Interest Rates for 'Some Time' | The Epoch Times
This
section will continue until it becomes unneeded.
COVID-19 Vaccines 'May Trigger' Rheumatic
Inflammatory Diseases: Study
On
average, patients developed rheumatic diseases 11 days after vaccine
administration, according to the study.
10/12/2023 Updated: 10/12/2023
A new review suggests that COVID vaccines "may
trigger" rheumatic immune-mediated inflammatory diseases, including
arthritis, vasculitis, lupus, and adult-onset Still's disease.
On average, patients developed rheumatic diseases
11 days after vaccine administration, according to the study. Seventy-five
(over 27 percent) of these patients experienced total disease remission, and
about 50 percent improved following treatment. Eight were admitted to intensive
care, and two died from their symptoms.
"The short time span between COVID-19 vaccine
administration and the onset of R-IMIDs suggests the potential possibility of a
cause-and-effect relationship," the authors wrote.
Rheumatic
immune-mediated inflammatory diseases (R-IMIDs) involve inflammation that
manifests in the joints, tendons, muscles, and bones due to an unknown cause.
The study, led by researchers
from the National Health Service in the United Kingdom, examined 271
participants from 190 case studies published worldwide.
Over 80
percent of the patients developed symptoms after their first or second dose of
the COVID-19 vaccine, and most were treated and improved with corticosteroids.
Almost 57 percent of
the injured patients received the Pfizer vaccine, nearly a quarter received the
AstraZeneca vaccine, and 12 percent of the rheumatic diseases manifested after
the administration of the Moderna vaccine.
More
COVID-19 Vaccines 'May Trigger' Rheumatic Inflammatory
Diseases: Study | The Epoch Times
Technology Update.
With events happening fast in the
development of solar power and graphene, I’ve added this section.
Twisted graphene sheets take on
exotic identities
12th October 2023
A single-atom-thick
sheet of graphene has remarkable properties on its own,
but things can get even more interesting when you stack up multiple sheets,
report researchers at the US National Institute of Standards and Technology
(NIST).
When two or more overlying
sheets of graphene are slightly misaligned — twisted at certain angles relative
to each other — they take on a plethora of exotic identities.
Depending on the twist
angle, these materials, known as moiré quantum matter, can suddenly generate
their own magnetic fields, become superconductors with zero electrical
resistance, or conversely, turn into perfect insulators.
Joseph A. Stroscio and his
colleagues at NIST, along with an international team of collaborators,
have developed a “quantum ruler” to measure and explore the strange properties
of these twisted materials.
The work may also lead to
a new, miniaturized standard for electrical resistance that could calibrate
electronic devices directly on the factory floor, eliminating the need to send
them to an off-site standards laboratory.
Collaborator Fereshte
Ghahari, a physicist from George Mason University in Fairfax, Virginia, took
two layers of graphene (known as bilayer graphene) of about 20 micrometers
across and twisted them relative to another two layers to create a moiré
quantum matter device.
Ghahari made the device
using the nanofabrication facility at NIST’s Center for Nanoscale Science and
Technology. NIST researchers Marlou Slot and Yulia Maximenko then chilled this
twisted material device to one-hundredth of a degree above absolute zero,
reducing random motions of atoms and electrons and heightening the ability for
electrons in the material to interact.
After reaching ultralow
temperatures, they examined how the energy levels of electrons in the layers of
graphene changed when they varied the strength of a strong external magnetic
field.
Measuring and manipulating
the energy levels of electrons is critical for designing and manufacturing
semiconductor devices.
----This
deviation translated into a set of different tick marks for the energy levels
of the electrons. The findings promise to shed new light on how electrons
confined to twisted sheets of graphene give rise to new magnetic properties.
“Using the new quantum
ruler to study how the circular orbits vary with magnetic field, we hope to
reveal the subtle magnetic properties of these moiré quantum materials,”
Stroscio said.
More
Twisted graphene sheets take on exotic identities (electronicsweekly.com)
This weekend’s music
diversion. Vivaldi having fun with valveless
horns. Well two out of three movements
anyway. Approx. 10 minutes.
A.
Vivaldi - Concerto in F major RV 538
A.
Vivaldi - Concerto in F major RV 538 - YouTube
This weekend’s chess
update. Approx. 12 minutes.
In
Chess, This is a Bar Fight! || Carlsen vs Srihari || Qatar Masters (2023)
In Chess, This is a Bar Fight! || Carlsen vs Srihari
|| Qatar Masters (2023) - YouTube
This
weekend the maths update. Approx. 8 minutes.
Numbers
too big to imagine
Numbers too big to imagine - YouTube
“It is forbidden to kill; therefore all
murderers are punished unless they kill in large numbers and to the sound of
trumpets.”
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