Baltic
Dry Index. 2086 -05 Brent Crude 77.97
Spot
Gold 2045 US
2 Year Yield 4.38 +0.05
Gold would have value if for no
other reason than that it enables a citizen to fashion his financial escape
from the state.
William F. Rickenbacker.
As
the global stock casinos get off to a dismal start to 2024, today’s action will
largely depend on the latest US unemployment figures due out later today.
In
better general news, Maersk has started routing its shipping through the Red
Sea once again.
Global stocks set to
snap 9-week winning streak on Fed repricing
By Kevin Buckland January 5, 2024 2:16 AM GM
TOKYO, Jan 5
(Reuters) - Asian stocks wobbled on Friday, keeping global equities on track to
snap a nine-week winning streak, while the dollar was poised for its strongest
weekly advance since mid-July as bets on aggressive Federal Reserve rate cuts
were rolled back.
MSCI's
broadest index of Asia-Pacific shares outside Japan (.MIAPJ0000PUS) eased 0.1%
in the Asian morning, with Hong Kong's Hang Seng (.HSI) slipping 0.18%.
The
MSCI world index (.MIWO0000PUS) was about flat so far on the day, but heading for a
1.7% decline this week.
Japan's
Nikkei (.N225) was something of an outlier, bouncing 0.5% on
Friday as exporters got a boost from the yen's slide back to just shy of 145
per dollar amid a rise in U.S. Treasury yields.
The U.S. dollar
index , which measures the currency against a basket of six major peers
including the yen, hovered around 102.39, not far from Wednesday's three-week
high of 102.73. For the week, it is up 0.97%.
Meanwhile, the
10-year Treasury yield was hovering just below the psychological 4% mark at
about 3.99%, up some 13 basis points over the week.
Overnight,
Wall Street's S&P 500 (.SPX) retreated 0.34%, taking its losses this week to
1.7%, setting up its first weekly decline since late October. Futures pointed
to a 0.08% rise at the reopen.
The
latest catalyst for a paring of Fed rate-cut bets came from more resilient
U.S. labour
market data on Thursday, putting less pressure on the central bank to
race to ease policy.
Traders now see a
little better than 2-in-3 odds that the Fed cuts rates by March, down from a
71% probability a week earlier, according to the CME Group's Fedwatch tool.
The release of
monthly U.S. payrolls figures looms large later in the day, with investors
"agonising" over the timing and pace of rate cuts, according to Kyle
Rodda, senior financial market analyst at Capital.com.
"Speculation
and a dose of leverage can force rates markets to overshoot," Rodda said.
More
Global stocks set to snap 9-week winning streak on Fed
repricing | Reuters
Nasdaq closes lower for a fifth day, its longest
losing streak since October 2022: Live updates
UPDATED THU, JAN 4 2024 4:32 PM EST
The Nasdaq
Composite closed lower on Thursday
for a fifth consecutive session — its longest losing streak since October 2022.
The tech-heavy Nasdaq Composite dipped 0.56% to
end at 14,510.30. Since the Dec. 27 close, the index has lost nearly 4%.
The S&P 500 slid
0.34%, marking a fourth day of declines, finishing at 4,688.68. The Dow Jones
Industrial Average was the outlier,
eking out a 10.15-point gain, or 0.03%, to close at 37,440.34.
Mega-cap tech stocks such as Apple are underperforming to start the year, as
overstretched valuations and uncertainty around when the Federal Reserve will
begin to cut rates have investors worried that markets have gotten overly
optimistic.
Apple stock is down more than 5% this week.
Shares of the tech giant fell more than 1% on Thursday following a downgrade by
Piper Sandler, two days after Barclays also lowered its rating on the name.
The recent performance on
Wall Street comes in stark contrast to how the market ended 2023. The S&P
500 ended last year up more than 24% while enjoying its best weekly win streak
going back to 2004.
More
Stock market today: Live updates (cnbc.com)
Finally,
have we now entered the death of the fiat dollar reserve standard?
Though
there’s nothing remotely around to replace the dollar in global trade, this
week the US Federal Debt shot across 34 trillion dollars for the first time. In
September it was “only” 33 trillion dollars, meaning Uncle Scam ran up another
trillion dollars of debt in just three months, a four trillion a year rate,
although hopefully that won’t happen.
To put US
debt in perspective, it took the USA 205 years to hit it’s first one trillion
dollars in debt on October 22, 1981. A
period that took in the War of Independence, a Civil War that wasn’t at all
civil, a Great Depression, two World Wars, the Korean and Vietnam Wars and
President Jimmy Carter to get to 1 trillion dollars in debt.
To add the
other 33 trillion dollars of debt took only a mere 42 years. A trillion is a
number followed by 12 zeros in the US number system. If you want to count to a
trillion at one numeral a second, good luck, it’s about 31,700 years.
For
comparison, US GDP was 26.23 trillion in 2023 and is estimated to be 28.6
trillion by the end of 2024, assuming no US recession.
That this
ends in the collapse of the Great Nixonian Error of fiat money is a given, but
what replaces it, when and how are all important questions.
Still, the
USA has another debt ceiling crisis problem coming up in about two weeks, so
that immediate problem is a more pressing concern next week.
Still, I’m
left with the thought that, like most central banks, this might be a good long-term
time to swap some fiat currency for physical gold and silver as a hedge against
the day the USA morphs into Argentina.
Gold demand hits record high amid global turbulence,
says Royal Mint
January
3, 2023
Investors flocked to gold in record
numbers in 2023 as global economic turbulence triggered a flight to safety,
according to the Royal Mint.
The number of people buying gold and
precious metal bars and coins jumped by 7pc year-on-year, surpassing the highs
of the 2020 lockdown investing boom.
The British coin maker said
this was due to a jump in small-scale retail investors buying
“safe haven” assets.
At the same time, The Royal
Mint’s total payouts to customers selling back their bullion surged by nearly
half after gold prices hit an all-time high last year.
Stuart
O’Reilly, an analyst at The Royal Mint, said gold prices could soar to new
record levels this year ahead of central bank interest rate cuts, which will
reduce the appeal of investments such as bonds,
or savings accounts.
Mr O’Reilly said: “The
potential for central bank rate cuts in 2024 is boosting the gold and precious
metals market, as the prospect of lower rates boosts demand for non-yielding
assets.”
Expectations of rate cuts
from the Federal Reserve in 2024, alongside the weakening of the US dollar,
“could turbocharge gold beyond recent market highs”, Mr O’Reilly said.
A record number of elections
around the world in 2024 is likely to bring further geopolitical turbulence, he
added.
Geopolitical and economic uncertainty,
alongside central bank gold buying, was key in pushing up precious metal prices
last year, Mr O’Reilly said.
Markets were rocked by
uncertainty over the outlook for global interest rates, as well as the wars in
Ukraine and between Israel and Hamas.
Record high gold prices
triggered a 19pc rise in the number of customers selling their gold investments
back to The Royal Mint last
year, with total payouts surging by 46pc compared to 2022.
Those buying were focused on
more affordable options. More than three quarters of gold bar and coin
investors bought “fractional” products in 2023, which are smaller than the
traditional size.
The Mint’s gold Sovereign,
gold Britannia coin and 1g gold bar, which is a 28th of the weight of a typical
one ounce bar, were the most popular.
These products meant customers could
invest in physical gold from around £75. The Royal Mint’s online platform,
DigiGold, also offers investments starting from £25.
Andrew Dickey, The Royal Mint’s
director of precious metals, said: “We have continued the development of our
smaller, fractional products allowing entry level investment right up to our
six-figure investment options. This has allowed more investors to purchase gold
with us.”
Sales of The Royal Mint’s bullion
coins are exempt from capital gains tax for UK residents because of their legal
status as British currency.
Gold demand hits record high amid global turbulence,
says Royal Mint (msn.com)
The great merit of gold is
precisely that it is scarce; that its quantity is limited by nature; that it is
costly to discover, to mine and to process; and that it cannot be created by
political fiat or caprice.
Henry Hazlitt.
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’s property ‘inventory overhang’ could
take more than 10 years to correct, economist says
PUBLISHED THU, JAN 4 2024 1:14 AM
EST UPDATED THU, JAN 4 2024 1:32 AM EST
China is facing the
prospect of a long-drawn correction in its property sector, with the overhang
in the housing inventory likely to take more than 10 years to clear, according
to Hao Hong, chief economist and partner at GROW Investment Group.
“If you look at the
inventory overhang situation — at this sales rate — it will take about two
years to clear all the inventory that is outstanding in the market,” Hong told
CNBC Street Signs Asia on Thursday.
“And then if you look
at the property under construction, we have 6 million square meters under
construction. At this rate, it will take probably more than 10 years to clear
all those housing under construction. So, all in all, we’re talking about multi
years in terms of correction,” he added.
Home sales growth and home prices have remained sluggish as real
estate developers have been mired in a spiraling debt crisis since 2020 when
Beijing kicked off a broader deleveraging
of the once-bloated real estate sector — which accounts
directly and indirectly for about one third of China’s economic activities.
The measures, known as China’s “three red lines”
policy, require developers to limit their debt in relation to the company’s
cash flow, assets and capital levels. Property giants Evergrande and Country
Garden have emerged as two of the
more high-profile casualties among real estate developers in the mainland.
“At this juncture, people have to get used to the
idea that it’s probably going to take much longer to clear all the inventories.
At the same time, one has to find new growth spots for the economy to go
forward, instead of just relying on just the property sector and property
investment for economic growth,” Hong said.
He said several market experts did
not expect the property correction to last so long.
More
China's housing inventory may take more than 10 years
to correct: economist (cnbc.com)
Why
Deutsche Bank reckons the UK economy will avoid a recession in 2024
WEDNESDAY 03 JANUARY 2024 2:06 PM
The UK economy
outperformed all expectations in 2023, but it was hardly a vintage year.
Growth was sluggish,
with GDP expanding 0.3 per cent in the first quarter and just 0.2 per cent in
the second. A mild downturn remains a possibility after revised figures showed
a 0.1 per cent contraction in the third quarter while monthly figures for October
did not make for happy reading either.
Yet despite the
picture of a slowing economy, analysts at Deutsche Bank expect the UK to avoid
a recession.
Going into the new
year, Sanjay Raja, chief UK economist at Deutsche Bank, pointed to a number of
reasons why the UK could have a stronger performance in 2024 than many
analysts expect.
It all starts with
inflation. Having peaked at over 11 per cent in October 2022, inflation
fell below four per cent in November 2023
for the first time in two years.
Raja suggested that
the rapid unwinding of inflationary pressures would continue in 2024.
“We’re seeing bigger
drops in demand sensitive price items – from core goods (clothing, furniture,
IT, cars), to demand sensitive services items like travel and recreation
services,” Raja said.
Energy prices, which
contributed significantly to the rise of inflation in the first place, will also fall further.
The bank estimates
that lower energy prices will save households around £10-15bn in 2024 relative
to last year. This could enable spending in “more productive” areas, Raja said.
With inflation likely
to fall further, the Bank of England will feel more able to ease monetary
policy.
The Bank has now left
interest rates on hold for three
consecutive meetings, keeping the benchmark
Bank Rate at a post-financial crisis high of 5.25 per cent.
While rate-setters
have insisted it is still
too early to cut interest rates, markets
expect the Bank of England to start cutting rates in May with the Bank Rate
falling to four per cent by the end of the year.
Raja expects 75bps of
rate cuts, starting in May, but did say more cuts were possible if there were
further drops in private sector pay and a more rapid increase in unemployment.
Falling inflation has
also contributed to an improving outlook for households as real wage growth has
climbed into positive territory.
More
Why Deutsche Bank thinks the UK economy will avoid a
recession (cityam.com)
Covid-19 Corner
This section will continue until it becomes unneeded.
India reports 602 new Covid cases
January 4, 2024 12:06 pm
India has recorded 602 new Covid-19 infections in the past
24 hours, pushing the the total number of active cases to 4,440 on Wednesday.
The country had recorded 865 new cases on May 19. Five new fatalities — one
each from Karnataka, Tamil Nadu and Punjab, two from Kerala — have been
reported in the span of 24 hours, according to the ministry’s data.
As of now, the total number of coronavirus cases in India,
since the outbreak in January 2020, has reached 4,50,15, 083. The death toll
related to Covid cases in the country has risen to 5,33,371.
The new variant, JN.1 subvariant is descendent of the
Omicron subvariant known as BA.2.86 or Pirola, with Kerala being the first
state to report a case. “A total of 511 cases of the JN.1 series variant have
been reported from 11 states till January 2. Karnataka has reported 199 cases
of the sub-variant. Kerala has reported 148 cases. 47 cases have been reported
from Goa, 36 from Gujarat, 32 from Maharashtra,” the health ministry has said.
The overall recovery from Covid has reached over 4.4 crore individuals,
reflecting a national recovery rate of 98.81 per cent. The country has
administered a total of 220.67 crore doses of Covid vaccines, as per the
available data.
India reports 602 new Covid cases - News Today | First
with the news (newstodaynet.com)
Crore
A crore (/krɔːr/;
abbreviated cr) denotes ten million (10,000,000 or 107 in scientific notation) and is equal to 100 lakh in the Indian numbering
system. It is written as 1,00,00,000 with
the local 2,2,3 style of digit group separators (one lakh is equal to one hundred thousand, and is written as 1,00,000).[1]
It is widely used both in
official and other contexts in Afghanistan, Bangladesh, Bhutan, India, Myanmar, Nepal, and Pakistan.
It is often used in Bangladeshi, Indian, and Pakistani English.
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.
Volkswagen sees promising test results for potential
breakthrough EV battery
Jan 4, 2024 10:37:55
AM IST
Volkswagen
AG said its battery startup has seen promising results with solid-state cells
for electric vehicles, a win for the German carmaker as it pushes to make EVs
more efficient and less expensive.
A solid-state prototype from VW’s US partner
QuantumScape Corp. “significantly exceeded” industry targets in recent tests,
the carmaker said Wednesday in a statement. During tests by VW’s battery unit
PowerCo over several months, the cell saw only 5% storage capacity loss after
more than 1,000 charging cycles, the equivalent of 500,000 kilometers on the
road. VW said industry targets for this development phase are 700 charging
cycles and a maximum loss of 20% capacity.
“These are very encouraging results,” PowerCo head
Frank Blome was quoted as saying. “The final result of this development could
be a battery cell that enables long ranges, can be charged super-quickly and
practically does not age.”
QuantumScape wants to bring the cell to market “as
quickly as possible,” founder and Chief Executive Officer Jagdeep Singh said.
But scaling up production of automotive-grade batteries has proven tricky and
has led the company to put more emphasis on batteries for consumer electronics
in its investor letters.
EV and battery makers are racing to commercialize
new technologies, including next-generation anodes and sodium-ion and
solid-state batteries, to power EVs more cheaply and efficiently. Toyota has
partnered with oil refiner and petrochemicals company Idemitsu Kosan Co. to
commercialize solid-state batteries as soon as 2027, while Chinese EV maker BYD
Co.’s subsidiary is building a sodium-ion battery facility as part of a joint
venture in eastern China.
Solid-state batteries replace the conventional
liquid electrolyte and the separator, which are both flammable, with a solid
separator made of ceramic, glass or polymers. This innovation, if proven to
work beyond the lab and reproduced flawlessly hundreds of thousands of times in
a factory, could make EV batteries safer, smaller and faster-charging.
The results of the test, carried out at PowerCo
labs in Germany, were first revealed by QuantumScape during the company’s
third-quarter earnings call in October. The battery startup didn’t mention
Volkswagen, its customer and largest shareholder, during the call.
Volkswagen sees promising test results for potential
breakthrough EV battery (cnbctv18.com)
Another weekend and the first war
weekend of 2024. How many more must die and for what? Man’s inhumanity to man,
or in Gaza, to mostly women and children. Have a great weekend everyone.
With the
exception only of the period of the gold standard, practically all governments
of history have used their exclusive power to issue money to defraud and
plunder the people.
Friedrich
August von Hayek.
No comments:
Post a Comment