Baltic
Dry Index. 1582 -03
Brent Crude 81.30
Spot Gold 1992 US 2 Year Yield 4.56 -0.08
The only way government bureaucrats know of keeping prosperity going is to inflate some more - to increase the deficit or to pump more money into the system.
Henry Hazlitt.
In the stock casinos, a weak rally. The dead cat bounce? In the real world, more sign of a global recession arriving.
One month away, the end of the US Fed’s emergency bank bailout program, the Bank Term Funding Program. Will that be the trigger for a widespread commercial real estate implosion? If it is, US regional and community banks will start to fail once again.
If the global economy isn’t actually rolling
over, it’s doing a stellar performance at faking it.
Japan and
Singapore miss GDP expectations; Asia markets rebound after Wednesday sell-off
UPDATED WED, FEB 14 2024 10:41 PM EST
Asia-Pacific markets rebounded after mostly
falling on Wednesday, while Japan entered a technical recession as it GDP
contracted for a second straight quarter.
Japan’s GDP for the
fourth quarter fell 0.4% on an annualized basis, a sharp miss from the 1.4%
growth expected by economists polled by Reuters. This follows a 3.3%
contraction in the third quarter.
Two consecutive
quarters of contraction are widely considered a technical recession.
On a
quarter-on-quarter basis, it slipped 0.1%, compared with a 0.3% rise expected
in the Reuters poll.
Following the
contraction, Japan lost its spot as the world’s third-largest economy to
Germany.
Singapore saw its
fourth-quarter GDP grow 2.2% year on year, lower than the 2.5% expected. The
city state also revised its third-quarter GDP growth rate from 2.8% to a
sharply lower figure of 1%.
Japan’s Nikkei 225 was
0.77% higher, briefly surpassing the 38,000 mark despite the missing GDP
expectations, while the broad-based Topix climbed 0.1%.
In Australia, the S&P/ASX 200 started
the day up 0.73%, snapping a three-day losing streak.
South Korea’s Kospi rose
0.18%, while the small-cap Kosdaq was 0.36% higher.
Hong Kong’s Hang Seng index opened
0.28% higher, extending gains from Wednesday, while mainland Chinese markets
are still closed for the week.
Overnight in the U.S., all three major indexes
also regained some ground after Wednesday’s sell-off following
hotter-than-anticipated inflation reading as traders fretted that the Federal
Reserve may
not cut interest rates as early as they had hoped.
The S&P 500 advanced
0.96%, while the Nasdaq Composite climbed
1.3%. The Dow Jones
Industrial Average added
0.4%.
Asia markets live
updates: Japan GDP, Singapore GDP, South Korea trade (cnbc.com)
Stock futures are
little changed as market rally seeks to regain momentum: Live updates
UPDATED THU, FEB 15 2024 12:35 AM EST
Stock
futures were little changed on Thursday morning as Wall Street looked to build
on a modest rebound with key economic data on deck.
Futures tied to the Dow Jones
Industrial Average ticked
up 10 points, or 0.03%. S&P 500
futures were
flat, and Nasdaq 100 futures dipped
marginally lower.
Stocks rallied on
Wednesday but did not erase all of the losses from Tuesday’s sell-off, which
came on the heels of a hotter-than-expected inflation report. The S&P 500 recaptured
the 5,000 level, closing slightly above it. Investors are weighing whether the
Federal Reserve can bring down inflation without
derailing an economy that keeps surprising to the upside.
More
Stock market today: Live updates (cnbc.com)
In other news, a global economy rolling over.
Cisco says
it’s cutting 5% of global workforce, amounting to over 4,000 jobs
Cisco announced
plans to cut 5% of its workforce on Wednesday, a decision that will result in
the elimination of about 4,250 jobs. Shares of Cisco were down as much as 9% in
extended trading.
It’s the latest tech company to
downsize in 2024, as the industry continues to squeeze
out costs following the market downturn that hit two years ago.
January was the busiest month for job cuts in the industry since March, as
Alphabet, Amazon, Microsoft and SAP all said they were eliminating positions,
as did eBay, Unity and Discord. So far this year, 144 tech companies have laid
off almost 35,000 workers, according to the website Layoffs.fyi.
More
Cisco
says it's cutting 5% of workforce, amounting to over 4,000 jobs (cnbc.com)
Morgan Stanley laying
off hundreds in wealth management unit, source says
By Mehnaz Yasmin
February
14, 2024 8:26 PM GMT
Feb 14 (Reuters) -
Investment banking giant Morgan Stanley (MS.N) is planning to cut hundreds
of jobs in its wealth management unit, according to a person familiar with the
matter, the latest in a string of layoffs that Wall Street firms have
undertaken since last year.
The cuts will impact less than 1% of the division's employees,
the person said, requesting anonymity.
While hopes of a soft landing for the economy have grown in
recent months, companies are still looking to trim costs amid uncertainty
around the trajectory of interest rate cuts by the U.S. Federal Reserve.
In the last quarter, revenue
from Morgan Stanley's wealth management unit was flat compared to a year earlier,
and the medium-term margin forecast for the business was below what some
analysts had expected.
The wealth management unit became an important moneymaker for
the bank after it clinched major acquisitions, including Eaton Vance and
E*Trade, under former CEO James Gorman.
The unit has helped make Morgan Stanley less dependent on its
traditional mainstays of trading and investment banking, revenues from which
can be volatile.
More
Morgan
Stanley laying off hundreds in wealth management unit, source says | Reuters
Japan’s economy unexpectedly slips into
recession, hurt by weak domestic demand
PUBLISHED WED, FEB 14 2024 7:00 PM EST
Japan’s economy dipped into a technical recession,
after unexpectedly contracting again in the October-December period, provisional government data showed Thursday. High inflation crimped domestic
demand and private consumption in what’s now the world’s fourth-largest
economy.
The latest gross domestic product print
complicates the case for interest rate normalization for Bank of Japan Governor
Kazuo Ueda and fiscal policy support for Japanese Prime Minister Fumio Kishida.
It also means Germany took Japan’s place as the third-largest economy in the
world last year in dollar terms.
Provisional gross domestic product contracted 0.4%
in the fourth quarter compared with a year ago, after a revised 3.3% slump in
the July-September period. This was way below the median estimate for 1.4%
growth in a Reuters poll among economists. The GDP deflator in the fourth
quarter stood at 3.8% on an annualized basis.
The Japanese economy also contracted 0.1% in the
fourth quarter from the previous quarter, after shrinking a revised 0.8% in the
third quarter from the second. This was also weaker than expectations for 0.3%
expansion.
“Whether Japan has now entered a recession is
debatable, though,” Marcel Thieliant, Capital Economics’ head of Asia-Pacific,
wrote in a client note.
“While job vacancies have weakened, the
unemployment rate dropped to an eleven-month low of 2.4% in December. What’s
more, the Bank of Japan’s Tankan survey showed that business conditions across
all industries and firm sizes were the strongest they’ve been since 2018 in
Q4,” he added.
“Either way, growth is set to remain sluggish this
year as the household savings rate has turned negative,” Thieliant said.
High inflation, weak domestic demand
Private consumption declined 0.2% in the fourth
quarter from the previous quarter, in contrast to the median estimate for a
0.1% expansion.
While inflation has been gradually slowing, the
so-called “core core inflation” — inflation minus food and energy prices — has
exceeded BOJ’s 2% target for 15 straight months now. Still, the BOJ has
“patiently continued” with the last negative-rate regime in the world.
More
Japan's
economy unexpectedly slips into recession, hurt by weak domestic demand
(cnbc.com)
US farm income set
for biggest plunge in 18 years as prices cool way off
By Karen Braun February 14, 2024 8:58 AM GMT
NAPERVILLE, Illinois, Feb 13 (Reuters) - A sharp
drop in crop prices coupled with rising production costs is set to slash U.S.
net farm income this year, though inflation may be masking the significance of these
price and income declines, especially in relation to past years.
The U.S. Department of Agriculture last week
forecast 2024 net farm income at $116 billion, down from $156 billion in 2023
and a record $186 billion in 2022, all in nominal dollars. That would be the
fifth-highest on record after the past three years plus 2013.
But inflation-adjusted, the 2024 forecast is 4%
below the 20-year average and down 41% from 2022. That would mark the biggest
two-year decline in net farm income by percentage since 1983, when the U.S.
rural economy was caught in a major agricultural crisis.
Net farm income of $116 billion in 2024 would be down 27% from the inflation-adjusted 2023 total, and would represent the largest annual decline since 2006.
Some inflation-adjusted commodity prices are not
far off 2020’s low levels, and 2020 would have been an extraordinarily
difficult year for farmers if not for massive government payments for both
trade war- and pandemic-related losses.
Direct government payments were responsible for
about 48% of U.S. net farm income in 2020, the highest share since 1983.
Discounting government payments, total inflation-adjusted net farm income in
2020 was the lowest since 2002.
---- PRICES MAY BE LOWER THAN APPEAR?
The average prices of new-crop CBOT corn and soybean futures
this month will represent insurance guarantees to U.S. farmers for the 2024
harvest, and planting decisions could be affected.
Those numbers are looking much less attractive than in prior
years.
Through nine of 20 trading days in February, average December
corn futures are down 20% from last February’s average and November soybeans
are off 15%. Both would represent the biggest year-on-year declines in February
prices since 2009.
December corn’s current average of $4.74 per bushel
is below $5.91 and $5.90 in 2023 and 2022, respectively, though it is otherwise
the highest since 2013.
However, a different picture emerges when inflation
is considered. Adjusting historical December corn prices during February using
monthly Consumer Price Index (CPI) data suggests the current $4.74 average
would be the second lowest since 2006 after February 2020’s adjusted price of
$4.60.
Nominally, new-crop corn in February 2020 averaged
$3.88 per bushel and new-crop soybeans averaged $9.17, both four-year lows for
the month.
More
US farm income set for biggest plunge in 18 years as prices cool way off | Reuters
Finally, can the US built EVs ever compete
with Chinese built EVs, assuming anyone actually wants an EV?
Why the U.S. auto industry is freaking out about China's electric cars
February 14, 2024
Why it matters: For big legacy automakers like Ford and General Motors,
budget-priced Chinese cars represent another Tesla-like seismic disruption.
The big picture: The entire industry is worried about the magnitude of what
Stellantis CEO Carlos Tavares calls "the China offensive."
- Companies that
can't match China's low-cost electric vehicles (EVs) "are going to be
in an existential problem," Tavares told Bloomberg.
- Even the
indomitable Tesla CEO Elon Musk is concerned, warning that without trade
barriers, Chinese automakers will
"demolish" global
rivals.
Catch up fast: China is the world's largest and fastest-growing
automobile market.
- Chinese cars
have long been poorly made. But thanks largely to government support —
plus access to cheaper batteries and labor — the country now makes
attractive, affordable models, like the sub-$11,000 Seagull EV from BYD,
the world's top seller of EVs and plug-in hybrids.
Yes, but: Chinese automakers built too many factories, forcing them
to look to foreign markets like Europe for continued growth.
- The U.S. could be next, where there's a big opening for
budget-priced EVs, despite stiff Trump-era tariffs on Chinese cars.
More
Why the U.S. car industry is worried about China's EVs (axios.com)
It is the maxim of every prudent
master of a family, never to attempt to make at home what it will cost him more
to make than to buy...What is prudence in the conduct of every private family,
can scarce be folly in that of a great kingdom.
Adam Smith, The
Wealth Of Nations, 1776.
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.
UK inflation holds at
4.0% in relief for BoE and Sunak
By Suban Abdulla February 14, 2024
9:22 AM GM
LONDON, Feb 14 (Reuters) - British inflation
unexpectedly held steady at 4.0% in January, defying forecasts of a rise,
official data showed, offering relief for the Bank of England (BoE) and Prime
Minister Rishi Sunak too ahead of a national election expected this year.
Economists polled by Reuters had forecast an
increase in the annual rate to 4.2%.
Consumer price inflation - which was higher in
Britain than in other rich economies until recently - is expected to fall
further in the coming months, paving the way for the BoE to start cutting
borrowing costs from their 16-year high.
Sterling weakened against
the dollar and the euro immediately after the inflation data was published.
Investors added to their bets on the BoE cutting interest rates
this year, putting a roughly 72% chance of a first reduction coming in June,
compared with only a 40% chance on Tuesday after a surprise jump in
U.S. inflation.
"Overall, the latest inflation data should reassure the
Monetary Policy Committee that the time to start cutting interest rates is
approaching," Martin Beck, chief economic advisor to the EY ITEM Club,
said.
Britain's core inflation, which excludes
volatile food, energy, alcohol and tobacco prices, was also unchanged at 5.1%,
the Office for National Statistics said.
More
UK inflation holds at 4.0% in relief for BoE and Sunak
| Reuters
Why
inflation staying stuck at four per cent is actually good news
WEDNESDAY 14 FEBRUARY 2024
9:25 AM
Inflation remained
stuck at four per cent in January, according to new figures released on
Wednesday morning, but this actually obscures the fact that price pressures are
abating.
Economists had
expected inflation
to rise to 4.2 per cent in January
reflecting two factors. The first is that Ofgem increased its energy price cap
by five per cent at the start of the year making household bills more
expensive.
Reflecting this, the
figures showed that gas prices rose by 6.8 per cent in January while
electricity prices rose by four per cent.
The second price
pressure forecast by economists was in services inflation. Services inflation
fell unusually fast this time last year, which distorts the annual comparison
since prices in January 2024 are measured against prices a year earlier.
As a result, the
annual rate of services inflation rose to 6.5 per cent from 6.4 per cent last
month.
Neither of these
factors are a cause for concern though. Its likely that Ofgem will reduce
its price cap by 14 per cent by April,
which will be a significant drag on inflation over the year.
And
although the level of services inflation remains far too high to be consistent
with the Bank’s two per cent target, this month’s increase should not be the
start of a renewed trend of price increases.
Wage growth, the most
important driver of costs in the services sector, is on its way down – if slightly
more slowly than expected.
Samuel Tombs, chief UK
economist at Pantheon Macroeconomics, said the increase in services inflation
was “entirely due to a base effect…rather than due to a pick-up in near-term
momentum.”
The fact that the
headline rate of inflation remained steady in January despite these increases
points to stronger than anticipated disinflationary pressures elsewhere.
More
Why inflation staying stuck at four per cent is
actually good news (cityam.com)
Covid-19 Corner
This section will continue until it becomes unneeded.
World
is not ready for Disease X and it will be worse than Covid, warns WHO
February
14, 2024
A fresh pandemic even
deadlier than Covid-19 could be
on the horizon and humanity is not remotely prepared to deal with it, WHO’s top
doctor has warned.
World Health Organisation boss
Tedros Adhanom Ghebreyesus said ‘Disease X’ could wreak havoc across the globe
because people have failed to learn lessons from previous pandemics.
Speaking at the World Government Summit in Dubai, Dr Tedros said
civilisation was ‘unprepared’ for the next pandemic.
‘Exactly six years ago, I said the world was not prepared for a pandemic
and expressed my concern at that time that a pandemic could happen any time,’
he told those in attendance.
‘Less than two years later, the Covid-19 pandemic
struck, and the world is still not prepared today.
‘In the aftermath of Covid-19, millions of people are dead with social,
economic and political shocks that reverberate to this day.
‘The painful lessons we learned are in danger of being forgotten as
attention turns to many other crises confronting our world.
‘But if we fail to learn those lessons, we will pay dearly next time –
and there will be a next time. The cycle of panic and neglect is beginning to
repeat.’
Disease X is the name given to a hypothetical disease or pathogen than
humanity is not equipped to deal with.
No-one can predict where or when the
next Disease X will emerge, but its existance ‘is a matter of when, not if,’ Dr
Tedros said.
Disease X ‘may be caused by an
influenza virus, or a new coronavirus, or it may be caused by a new pathogen we
don’t even know about yet’, he added.
‘Covid-19 was a Disease X – a new
pathogen causing a new disease.’
‘But there will be another Disease X,
or a Disease Y or a Disease Z.’
Covid-19 was one of the deadliest
pandemics in human history, killing an estimated 7 million people worldwide.
But WHO has previously warned that a
hypothetical Disease X could kill up to 20 times more people than coronavirus.
Dr Tedros’ warning comes as a series
of potentially deadly outbreaks have been recorded in recent weeks.
More
World is not ready for Disease X and it will be worse
than Covid, warns WHO (msn.com)
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.
Graphene’s New Best Friend: UV Tape That Transfers
Wonder Materials Without the Hassle
By KYUSHU UNIVERSITY FEBRUARY 9, 2024
Researchers create UV-sensitive tape that can transfer 2D
materials like graphene in
an easier, cheaper, and less damaging way.
Materials
just atoms in thickness, known as two-dimensional (2D) materials, are set to
revolutionize future technology, including in the electronics industry.
However, the commercialization of devices that contain 2D materials has faced
challenges due to the difficulty in transferring these extremely thin materials
from where they are made onto the device.
Breakthrough in 2D Material Transfer
Now, a research team from Kyushu University, in
collaboration with Japanese company Nitto Denko, has developed a tape that can
be used to stick 2D materials to many different surfaces, in an easy and
user-friendly way. Their findings were published in Nature Electronics on February 9, 2024.
“Transferring 2D materials is typically a very
technical and complex process; the material can easily tear, or become
contaminated, which significantly degrades its unique properties,” says lead
author, Professor Hiroki Ago of Kyushu University’s Global Innovation Center.
“Our tape offers a quick and simple alternative, and reduces damage.”
Enhancing the Application of Graphene
The
researchers began by focusing on graphene. Made from a thin sheet of carbon
atoms, graphene is tough, flexible, and light, with high thermal and electrical
conductivity. Dubbed a “wonder material” upon discovery, it has potential
applications in biosensing, anti-cancer drug delivery, aeronautics, and
electronic devices.
---- The researchers also developed tapes that can transfer
two other 2D materials: white graphene (hBN), an insulator that can act as a
protective layer when stacking 2D materials, and transition metal
dichalcogenides (TMDs), a promising material for the next generation of semiconductors.
Importantly, when the researchers looked closely at the surface of the
2D materials after transfer, they saw a smoother surface with fewer defects
than when transferred using the current conventional technique. Upon testing
the materials’ properties, they also found that they were more efficient.
More
The state is the great fictitious entity by which everyone seeks to live at the expense of everyone else.
Frederic Bastiat.
No comments:
Post a Comment