Baltic Dry Index. 1662 -170 Brent Crude 89.30
Spot Gold 1988 US 2 Year Yield 5.02 -0.06
"Let's
make sure that there is certainty during uncertain times in our economy."
President
George W. Bush
In the stock casinos, more interest rate fears as the US GDP comes in better than expected. Will the US central bank feel forced to raise their key interest rate yet again?
In Euroland, the UK and USA, recession looms,
though for now Euroland is leading the charge.
Mainland China
bucks broader Asia market sell-off; Australia shares close at one-year low
UPDATED THU, OCT 26 2023 3:53 AM EDT
Asia-Pacific markets saw a broad sell-off, with
Australia shares closing at a low not seen in over a year, while mainland China
stocks bucked the broader trend to end Thursday higher.
South Korea’s Kospi index slipped
2.71% to close 2,299.08, its lowest level since Jan. 6, while the Kosdaq index
shed 3.5% to reach 743.85, its lowest since Jan. 31.
This comes as shares of South
Korean chip supplier SK Hynix dropped after announcing a 2.18 trillion won ($1.61 billion) net loss for
the third quarter, in contrast to a 1.11 trillion won net profit in the same
period a year ago.
South Korea’s gross domestic product grew 0.6% in the
third quarter from the prior quarter, a slightly higher-than-expected pace
compared to a Reuters poll.
Japan’s Nikkei 225 fell
2.14% to end at 30,601.78 and the Topix index dropped 1.34% to finish at
2,224.25.
In Australia, the S&P/ASX 200 closed
0.61% down at 6,812.30, hitting its lowest point since late October, 2022.
Hong Kong’s Hang Seng index dipped
0.11% in the final minutes of trading, while China’s benchmark CSI 300 index
was the only one in positive territory, climbing 0.28% to 3,514.14.
The S&P 500 closed
below a key level on Wednesday after disappointing quarterly results from
Google-parent Alphabet and
a rebound in interest rates.
The benchmark index fell 1.43% to
close at 4,186.77, ending
the day below the 4,200 level that was being widely watched by
chart analysts. It was the first time the S&P 500 closed below this
threshold since May.
The Dow Jones Industrial Average fell
105.45 points, while the Nasdaq
Composite lost 2.43%.
Asia
stock markets today: Live updates (cnbc.com)
U.S. GDP grew at a 4.9% annual pace in the third
quarter, better than expected
PUBLISHED THU, OCT 26 2023 8:30
AM EDT
The U.S. economy grew even faster than expected in
the third quarter, buoyed by a strong consumer in spite of higher interest
rates, ongoing inflation pressures and a variety of other domestic and global
headwinds.
Gross domestic product, a measure of all goods and
services produced in the U.S., rose at a 4.9% annualized pace in the
July-through-September period, up from an unrevised 2.1% pace in the second
quarter, the Commerce Department reported Thursday.. Economists surveyed by Dow Jones had been
looking for a 4.7% acceleration.
The sharp increase came due to contributions from consumer
spending, increased inventories, exports, residential investment and government
spending.
Consumer spending, as
measured by personal consumption expenditures, increased 4% for the quarter
after rising just 0.8% in Q2. Gross private domestic investment surged 8.4% and
government spending and investment jumped 4.6%.
Spending at the
consumer level split fairly evenly between goods and services, with the two
measures up 4.8% and 3.6% respectively.
The GDP increase
marked the biggest gain since the fourth quarter of 2021.
---- While the report could give the Federal
Reserve some impetus to keep policy tight, traders were still pricing in no
chance of an interest rate hike when the central bank meets next week,
according to CME Group data. Futures pricing pointed to just a 27% chance of an
increase at the December meeting following the GDP release.
“Investors should not
be surprised that the consumer was spending in the final months of the summer,”
said Jeffrey Roach, chief economist at LPL Financial. “The real question is if
the trend can continue in the coming quarters, and we think not.”
More
U.S. GDP grew at a 4.9% annual pace in the third
quarter, better than expected (cnbc.com)
The U.S. consumer is ‘walking
towards a cliff,’ strategist warns
PUBLISHED THU, OCT 26 2023 6:01 AM EDT
Trouble is brewing
for the U.S. consumer, according to one strategist, and a substantial labor
market downturn could kickstart a recession.
“I think the U.S.
consumer is walking towards a cliff, basically,” Chris Watling, chief executive
of financial advisory firm Longview Economics, told CNBC’s “Squawk Box Europe”
on Tuesday.
He said that a slew
of recent economic indicators had showed consumers are quickly running out of
excess cash, while household savings are coming under pressure.
“Of course, retail sales have been quite strong
for the last few months and everyone gets quite excited about that, but,
actually, if you look at what’s going on, the household savings ratio has been
run down, and, in fact, real income growth has been negative for three months,”
Watling said.
“So, it’s not quite all good news. I mean, quite
the reverse, I think there are some real challenges coming for the U.S.
consumer.”
His comments come even as data suggests the U.S.
economy may have turned in another stellar performance, heading into the final part of the year.
----“We see at the margins the consumer is under a
lot of pressure and, in fact, the labor market is under a lot of pressure as
well. We had a good payrolls month,
but if you look at a lot of the indicators of where the labor market is likely
to go, a lot of them are fraying at the edges,” Watling said.
“We’re going to get to the point in the next few
months when I think the labor market starts to deteriorate more meaningfully
and that’ll kickstart the recession when we get there,” he added.
Asked what his forecast would likely mean for the
stock market, Watling replied, “I think leadership probably is changing in this
stock market. Tech has been under a lot of pressure since July, and I think the
stock market is struggling to know really exactly where it wants to go.”
More
The U.S. consumer is 'walking towards a cliff,'
strategist warns (cnbc.com)
Next, yet more bad news for food price
inflation.
Ukraine suspends
Black Sea grain corridor over threat from mines, warplanes
By Pavel Polityuk October 26, 202312:33 PM GMT+1
KYIV, Oct 26 (Reuters) - Ukraine has
suspended the use of its new Black Sea grain export corridor due to a possible
threat from Russian warplanes and sea mines, the Kyiv-based Barva Invest
consultancy and a British security firm said on Thursday.
Ukraine has been using the shipping
corridor to try to revive its seaborne exports without Russia's blessing,
defying threats from Moscow which quit a U.N.-brokered deal in July that had
allowed some food exports to flow despite the war.
"We would like to inform you of a
temporary suspension of vessel traffic to and from (the ports). The current ban
is in force on Oct. 26, but it is possible that it will be extended," the
consultancy said on the Telegram messaging app.
Ukrainian officials declined to comment
on the matter.
Chicago wheat futures , a global price
benchmark, turned higher on the news to recover from an earlier two-week low.
They later traded up about 1%.
Wheat futures had been pressured this
week by hopes that Ukraine would expand grain exports, as well as rain relief
in dry crop belts worldwide.
Barva Invest, which specialises in
Ukraine's agriculture sector, said a de facto suspension had already been in
place for two days at the behest of Kyiv's military which had cited a threat
from increased Russian air force activity in the area.
Russian President
Vladimir Putin said last week that he had ordered Russian warplanes with Kinzhal
missiles to patrol the Black Sea.
British maritime security company
Ambrey said in a report that the Ukrainian Seaport Authority issued a
communique late on Wednesday, noting "there would be no vessel movement
along the corridor for entry and exit on 26th of October, 2023."
The suspension was prompted by Russian
Air Force operations in the region, it said.
"On October 25th, Ambrey informed
its clients that the Russian Air Force had dropped at least four objects,
likely acoustic and/or magnetic sea mines, into the Ukrainian grain corridor
transit area near Snake Island, Ukraine," it said.
Ukrainian forces were likely conducting
operations to locate and destroy the sea mines, it said.
More
Ukraine suspends Black Sea grain corridor over threat
from mines, warplanes | Reuters
Finally, in rush to WW3 global war news, an
all out war takes another step forward. But, are we heading towards another
1973 style Arab oil embargo?
Israel-Hamas war
live updates: U.S. conducts military strikes in Syria; nine Arab countries
condemn Gaza bombing
UPDATED FRI, OCT 27 2023 12:09 AM
EDT
The U.S. has launched military strikes on two
facilities in eastern Syria on President Joe Biden’s orders. The facilities
were used by Iran’s Islamic Revolutionary Guard Corps in retaliation for
attacks on U.S. forces, the U.S. Department of Defense said late Thursday.
“The United States does not seek
conflict and has no intention nor desire to engage in further hostilities, but
these Iranian-backed attacks against U.S. forces are unacceptable and must
stop,” said U.S. Defense Secretary Lloyd J. Austin.
Earlier, the foreign ministers of
the United Arab Emirates, Jordan, Bahrain, Qatar, Kuwait, Saudi Arabia, Oman,
Egypt and Morocco condemned the
targeting of civilians and violations of international law in Gaza by
Israeli forces.
In a joint statement, the Arab
nations reportedly said that Israel’s right to self-defense following Hamas’
Oct. 7 attacks did
not justify breaking the law and neglecting Palestinians’
rights.
More
Israel-Hamas
war updates and latest news on Gaza conflict (cnbc.com)
Oil rises more than
$1 on fears of spread of Middle East conflict
October 27, 20234:42 AM GMT+1
SINGAPORE, Oct 27
(Reuters) - Oil prices rose by over $1 on Friday as reports that the U.S
military struck Iranian targets in Syria raised concerns of a widening of the
Israel-Hamas conflict that could impact supply from the key Middle East
producing region.
Brent crude
futures for December rose $1.16, or 1.3%, to $89.09 a barrel by 0338 GMT. The
U.S. West Texas Intermediate contract for December climbed $1.08, also 1.3%, to
$84.29 a barrel.
The
strikes on two facilities in eastern Syria used by the Iran's Islamic
Revolutionary Guard Corps and groups it backs was in response to recent attacks
on U.S. troops in Iraq and Syria, the Pentagon said on Thursday.
Those attacks have increased since the start of the Israel-Hamas conflict on
Oct. 7.
Though
the strike did not directly impact supply, it increases fears that the
conflict in the Gaza Strip between Israel, backed by the U.S., and Hamas may
spread and disrupt supply from major crude producer Iran, which backs Hamas. A
wider war could also impact shipments from Saudi Arabia, the world's largest
oil exporter, and other large producers in the Gulf.
More
Oil
rises more than $1 on fears of spread of Middle East conflict | Reuters
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.
Core inflation in
Japan's capital unexpectedly accelerates, BOJ in spotlight
October 27, 20233:41 AM GMT+1
TOKYO, Oct 27 (Reuters) - Core consumer
inflation in Japan's capital Tokyo, considered a leading indicator of
nationwide trends, unexpectedly accelerated in October, a sign of broadening
price pressures that may keep alive expectations of near-term end to ultra-low
interest rates.
The data reinforces
expectations the Bank of Japan (BOJ) will revise up its inflation forecasts
when it produces fresh quarterly
projections at next week's policy meeting.
The Tokyo core consumer price index
(CPI), which excludes volatile fresh food but includes fuel costs, rose 2.7% in
October from a year earlier, government data showed on Friday, exceeding market
forecasts for a 2.5% gain.
The increase, which was faster than a
2.5% gain in September, casts doubt on the central bank's view that inflation
will slow in coming months as cost-push pressure dissipate.
The so-called "core core"
index that strips away both fresh food and fuel prices - closely watched by the
BOJ as a gauge of broader price trends - rose 3.8% in October from a year
earlier after a 3.9% increase in September, the data showed.
More
Core
inflation in Japan's capital unexpectedly accelerates, BOJ in spotlight |
Reuters
A recession is about to hit the
US economy and these 3 warning signs are defying the consensus view, Raymond
James says
Updated Tue, 24 October 2023 at 4:53 pm BST
Don't be fooled by a resilient
consumer as a recession is poised to hit the US economy within the next nine
months, Raymond James' chief investment officer, Larry Adam, said in a recent
note.
Wall Street forecasts of a
recession have been getting pushed further
and further out into the future as
consumers continue to show solid spending habits and are overall in good
financial shape. But Adam said a convergence of several risk factors suggested
the economy would be unable to avoid a mild recession within the next year.
These are the three warning signs
he said he was monitoring ahead of a potential recession.
1. Growing headwinds for consumers
From the resumption of
student-loan payments to elevated borrowing costs, there are a lot of risks
that everyday consumers are forced to navigate. Tailwinds that drove strong
consumer spending since the pandemic are ending, and excess savings have been nearly
depleted.
"Sure, consumers have jobs
and income right now, but their ability to continue to consume indiscriminately
is coming to an end," Adam said.
He pointed to recent comments
from Bank of America CEO Brian Moynihan, who said consumer spending was running
at levels consistent with a low-inflation, low-growth economy that was
prevalent before the pandemic.
Finally, growing credit-card debt and rising
delinquencies suggest more
Americans are starting to fall behind on debt obligations.
"While we are not suggesting
that consumption is going to fall off a cliff, a moderation in spending should
be expected," Adam said.
More
Britain
is quietly inching towards a fate worse than bankruptcy
We
only have to look to the 1970s to see where unsustainable spending and debt
lead us
In 1914, Argentina had
essentially arrived as a wealthy country. From 1870 to 1914, the economy had
grown 6pc a year in real terms. British finance was flooding in, funding the
building of railways and factories, the sinews of an export boom.
Argentina still lagged
behind the United States, but its economy was on par with France, Germany and
Canada. It would have seemed strange to predict anything other than a
glittering future.
Today,
Argentina serves as a cautionary tale, a rich nation that took a wrong turn –
and proof that development can go into reverse. It’s one that Britain would do well to pay attention to.
The UK entered this
century with debt at less than 30pc of GDP. In the 20 years that followed, the
financial crisis, lockdown and Ukraine war have seen it rise above 100pc.
Interest
payments are at their highest levels since the 1980s. The tax burden, too, is at a post-war high, limiting the ability of the government to raise further
revenue.
And yet demands for
spending keep mounting. Take that most sacred of ungulates, the NHS. In just
over 10 years’ time, it is estimated that it will require an additional
800,000-900,000 staff to meet growing demand from an ageing population. At that
size, it could easily employ one in eleven workers in England.
But as the Public
Accounts Committee pointed out on Wednesday, there is no actual plan to pay for
all these workers, the tools they will need, or indeed the buildings they will
work in.
Given that the
day-to-day budget of the NHS may need to increase by 70pc to accommodate this,
we probably should start to think about one, particularly as even the current
expansion might still be insufficient to keep the system from toppling over.
The workforce plan
assumes that NHS staff will become 1.5-2pc more productive every year. To put
this into context, from 2005 to 2018, productivity in the NHS grew by around
1.4pc each year.
More
Britain is quietly inching towards a fate worse than bankruptcy (telegraph.co.uk)
Covid-19 Corner
This section will continue until it becomes unneeded.
Today and the rest of the week, why the British public hold most Members of Parliament in contemp. Only 16 or 17 MPs bothered to attend the House, mostly Conservative MPs, with the rest of the Commons treating the British public suffering from vaccine damage, with antipathy and disrespect.
Parliamentary
speech on excess deaths
Parliamentary speech on excess deaths - YouTube
Great
public support
Great public support - YouTube
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.
Consultation
launched into £224m solar power and battery storage site in north Notts
October 24, 2023
A preliminary consultation has kicked
off into plans to invest £224 million in a “nationally significant” solar power
farm and battery storage site in north Nottinghamshire.
Renewable energy company RES wants to
create the vast renewable energy project near to the West Burton Power Station
and the neighbouring village of Sturton-le-Steeple.
If it were to get the go-ahead, the
so-called Steeple Renewables Project could be capable of producing clean, green
electricity for more than 150,000 homes a year – equal to around 45 per cent of
all homes in Nottinghamshire.
RES said the scheme could create 400
jobs over the 24-month build programme, and would also allow agricultural use
of the land to continue once it was running.
The energy business said it is
looking at several parcels of land surrounding Sturton-le-Steeple, and south of
the power station which ceased generation in March after 57 years.
The UK Atomic Energy Authority
(UKAEA) already plans to build the UK’s first ever prototype fusion power
station at West Burton. If it can be made commercially viable, fusion could
offer a virtually limitless source of clean electricity by copying the processes
that power the sun.
The early consultation will run for
six weeks until Monday, December 4, with in-person events held from 2-7pm on
November 3, 2pm-7pm at South Leverton Memorial Institute, South Leverton, and
from 10-2pm on November 4 at Sturton Hall and Conference Centre, in Sturton le
Steeple.
The next stage would be a formal
design report next spring, followed by a statutory consultation in the summer,
prior to a development application, with a possible decision by the end of
2026.
RES project manager Will Bridges
said: “Our plans are at an early stage, with ongoing technical work taking
place to fully understand the suitability of the site.
“We want to involve the local
community from the outset and are undertaking this early informal consultation
to introduce the plans and invite early feedback.
“This renewable energy project,
alongside other proposals, embraces the historic role that the area has played
in powering the UK.
“We believe there is an opportunity
to build on this legacy and ensure that Nottinghamshire continues to play an
important role in the UK’s future energy generation.
“We’d encourage local residents to
provide their feedback on our early plans by attending one of our in-person
events or visiting the project website.”
RES said as part of the plans it was
keen to develop a community benefits package which could include its Local
Electricity Discount Scheme (LEDS).
Consultation launched into £224m solar power and
battery storage site in north Notts (msn.com)
Another weekend and sadly, another war
weekend in Gaza.
No weekend math’s update tomorrow. Instead, the Fresnel lighthouse lens. Note, the s in Fresnel is not
pronounced, for some reason best known to the French. Have a great weekend everyone.
Henry
Hazlitt.
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