Baltic
Dry Index. 1876+102
Brent Crude 83.47
Spot
Gold 2323 US 2 Year Yield 4.82 +0.01
The global financial crisis - missed by most analysts - shows that most forecasters are poor at pricing in economic/financial risks, let alone geopolitical ones.
Nouriel Roubini.
In the stock casinos, the one way bet on the Fed and other central banks cutting interest rates.
Inflation’s over right? Look away from those
foodstuff commodities now.
Asia markets
extend gains on rate cut optimism; RBA leaves cash rate unchanged at 4.35%
UPDATED TUE, MAY 7 2024 12:40 AM EDT
Asia-Pacific markets climbed on Tuesday,
extending gains from the previous session, as Wall Street rose overnight on
expectations that the Federal Reserve will cut interest rates.
In Asia, the
Reserve Bank of Australia held its benchmark lending rates at 4.35% for the
fourth meeting in a row, as expected.
Australia’s S&P/ASX 200 was
up 1.02% after the decision, on course to gain for a fourth straight day.
South Korea’s Kospi popped
1.8% to hit a one-month high as trading resumed after a public holiday. The
small-cap Kosdaq rose 0.61%.
Japan’s Nikkei 225 also
resumed trading after a holiday to rise 1%, while the broad-based Topix gained
0.19%.
Hong Kong’s Hang Seng index edged
0.31% higher, while mainland China’s CSI 300 was flat.
Overnight in the U.S., an announcement from Hamas on Monday that it
had accepted an Egyptian-Qatari cease-fire proposal to end the war with Israel
also gave stocks a boost, with the Dow Jones Industrial Average notching
a fourth consecutive winning session, up 0.46%.
The S&P 500 advanced
1.03%, while the Nasdaq Composite gained
1.19%.
Asia markets live
updates: RBA decision, Japan PMI (cnbc.com)
Dow climbs more
than 170 points to post fourth straight winning day, propelled by rate cut
hopes: Live updates
UPDATED MON, MAY 6 2024 4:28 PM EDT
Stocks
advanced Monday, with Wall Street building on the previous session’s strong
gains as traders lifted Federal Reserve rate cut expectations.
The Dow Jones Industrial Average climbed
176.59 points, or 0.46%, to close at 38,852.27. It was the fourth consecutive
winning session for the 30-stock index. The S&P 500 advanced
1.03% to end at 5,180.74, and the Nasdaq Composite gained
1.19% to reach 16,349.25.
An announcement from Hamas on Monday that it
accepted an Egyptian-Qatari cease-fire proposal to end the war with Israel gave
stocks a boost in early afternoon trading.
Wall Street is coming off a
winning session after fresh nonfarm payrolls data on Friday showed
fewer-than-expected jobs were added in April along with an increase in
unemployment, easing fears of an overheating economy.
“It’s good that we’re getting
some sort of a continuation, because it seems as if the market is saying that
the pullback is over and we’ll just work our way back up,” CFRA chief
investment strategist Sam Stovall said, adding that Monday’s momentum is a reaction
to Fed Chair Jerome Powell’s statement last
week that ruled out a rate hike as the central bank’s next move. That
“made investors breathe a sigh of relief,” Stovall said.
More
Stock
market today: Live updates (cnbc.com)
European stocks
set to open higher, reflecting wider optimism in global markets
UPDATED TUE, MAY 7 2024 12:27 AM EDT
European
markets are heading for a positive start to trading Tuesday as traders look
ahead to a busy day of earnings reports in the region.
BP, S4 Capital, Siemens
Healthineers, Deutsche Post, Infineon, Bouygues, UBS, Adecco, Banco de Sabadell
and Unicredit are among the companies reporting earnings Tuesday.
Overnight, U.S. stock futures
flickered near the flatline Monday evening after the Dow Jones Industrial Average wrapped
its fourth positive day in a row. Asia-Pacific markets climbed
overnight, extending gains from the previous session and buoyed by gains on
Wall Street.
European markets live updates: stocks, news, data and earnings (cnbc.com)
Next, yet more trouble at Boeing. Should
anyone fly in a Boeing if an alternative choice is available?
The FAA investigates after Boeing says workers in
South Carolina falsified 787 inspection records
May 6, 2024
The Federal Aviation Administration said Monday it has opened an investigation into Boeing after the beleaguered company reported that workers at a South Carolina plant falsified inspection records on certain 787 planes. Boeing said its engineers have determined that misconduct did not create “an immediate safety of flight issue.”
In an email to Boeing's South Carolina employees on April 29, Scott Stocker, who leads the 787 program, said a worker observed an “irregularity” in a required test of the wing-to-body join and reported it to his manager.
“After receiving the report, we quickly reviewed the matter and learned that several people had been violating Company policies by not performing a required test, but recording the work as having been completed,” Stocker wrote.
Boeing notified the FAA and is taking “swift and serious corrective action with multiple teammates,” Stocker said
No planes have been taken out of service, but having to perform the test out of order on planes will slow the delivery of jets still being built at the final assembly plant in North Charleston, South Carolina.
Boeing must
also create a plan to address planes that are already flying, the FAA said.
The 787 is a two-aisle plane that
debuted in 2011 and is used mostly for long international flights.
“The company voluntarily informed us
in April that it may not have completed required inspections to confirm
adequate bonding and grounding where the wings join the fuselage on certain 787
Dreamliner airplanes,” the agency said in a written statement. “The FAA is
investigating whether Boeing completed the inspections and whether company
employees may have falsified aircraft records.”
The company has been under intense
pressure since a door plug blew out of a Boeing 737 Max during an Alaska
Airlines flight in January, leaving a gaping hole in the plane. The accident
halted progress that Boeing seemed to be making while recovering from two
deadly crashes of Max jets in 2018 and 2019.
More
In other news, Red Sea shipping disruption will probably last all year and be inflationary.
Maersk says Red Sea
disruption could cut Asia-Europe capacity by 20%
By Stine Jacobsen May 6, 2024 12:32 PM GMT+1
COPENHAGEN, May 6 (Reuters)
- Disruption to Red Sea container shipping is rising, Maersk (MAERSKb.CO), opens new tab said on Monday,
forecasting this will cut the industry's capacity between Asia and Europe by up
to 20% in the second quarter.
Maersk and other shipping companies have diverted vessels
around Africa's Cape of Good Hope since December to avoid attacks by
Iran-aligned Houthi militants in the Red Sea, with the longer voyage times
pushing freight rates higher.
"The risk zone has expanded, and attacks are
reaching further offshore," Denmark's Maersk said.
"This has forced our vessels to lengthen their
journey further, resulting in additional time and costs to get your cargo to
its destination for the time being," it added in an updated advisory to
customers.
Maersk's fuel costs on the affected routes between
Asia and Europe are now 40% higher per journey, a spokesperson said.
Germany's Hapag-Lloyd (HLAG.DE), opens new tab, which has said it
believes the crisis can be overcome before the end of 2024, is also rerouting
vessels for the time being.
"The attacks in the Red Sea and the Gulf of Aden are moving
further and further out to sea. That is why we are avoiding this area
altogether," Hapag-Lloyd said in
e-mailed comments.
By routing traffic away from the Suez Canal, Maersk estimated
that the container industry's capacity between Asia and northern Europe and the
Mediterranean would be cut by between 15% and 20% in the second quarter.
The disruptions cause ripple
effects across several other container freight routes, particularly from Asia
to the east and west coasts of South America, Maersk's spokesperson said,
adding that the Red Sea situation was complex and continued to evolve.
Maersk, viewed as a barometer of world trade, forecast last
week that disruptions would last at least until the end of 2024.
Meanwhile, France's CMA CGM is still sending some vessels via
the Red Sea escorted by French or other European navy frigates, but the
majority of its ships are being rerouted around Africa, CEO and Chair Rodolphe
Saade told Le Monde.
"The problem is that you have to call at ports
that are not the final destination and to transship onto smaller vessels,"
Saade told the newspaper in an interview published on Monday.
"Tangiers is saturated and alternatives need
to be found - like (Spain's) Algeciras or Valencia," he added.
The knock-on effects of voyages around Africa
include bottlenecks and vessel bunching, where several ships arrive at port at
the same time, as well as equipment and capacity shortages.
"We are doing what we can to boost
reliability, including sailing faster and adding capacity," Maersk said,
adding that it had so far leased more than 125,000 additional containers.
Maersk says Red Sea disruption could cut Asia-Europe
capacity by 20% | Reuters
What we need to understand is, one, that there are market failures; and two, that there are things like asset bubbles and irrational exuberance. There are periods of booms, bubbles, and manias. These things, if left to themselves, can lead to crashes, to busts, to panics.
Nouriel Roubini.
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.
Crisis in UK farming due to
Brexit and flooding ‘risks new rise in inflation’
May
6, 2024
A combination of Brexit and the wettest UK weather for nearly 200 years will lead to a significant drop in food production
by British farmers this year and risks fuelling a fresh rise in inflation, the industry has warned.
A record two thirds of farmers are either forecasting a decline in their profits or
bankruptcy in the next 12 months due to an unprecedented “perfect storm”,
according to the National Farmers Union’s (NFU) annual survey of the industry.
All
farming sectors are set to reduce production over the next year, with arable –
which was last year severely affected by one of the wettest periods for
decades, leaving fields flooded and unsuitable for sowing – expected to
decrease the most.
But because severe drought and storms have also affected farmers on the continent and in
Russia, the UK food industry cannot automatically rely on Northern Europe to
fill gaps in the supply chain, the NFU’s president, Tom Bradshaw, warned.
He said it was grimmest
outlook for farmers in England and Wales in the 14 years the NFU has run the
survey and leaves the UK on the brink of a food security crisis.
These
factors included the wars in Ukraine and the Middle East pushing up prices for
fuel and fertiliser, the wettest 18 months in Britain since 1836, and the phasing
out since Brexit of the basic payment scheme of EU subsidies for farmers.
He said: “These figures paint
a really stark picture. Confidence has collapsed after months of
devastating flooding, unsustainably high production costs and low market
returns, and against a backdrop of reduced farm support as we transition to a
new domestic agriculture policy and associated farm support.”
Asked whether plans for an
industry-wide drop in production would push up UK inflation, Mr Bradshaw said:
“What this is going to do is mean we are more reliant on global imports. And so
that global commodity market is going to be a big driver now of UK prices over
the coming months.
“The weather that we’ve seen
in the UK has been repeated across Northern Europe … So the global commodities
market is going to become ever more relevant in driving the direction of
domestic prices.”
The survey showed that 82 per
cent of farmers have suffered negative impacts from the wet weather, while the
phasing out of BPS [basic payment subsidy scheme] is set to negatively affect
86 per cent of farm businesses. Input prices including fuel, fertiliser and
energy are forecast to have a negative impact for 80 per cent of farmers, while
labour supply will negatively impact 50 per cent.
More
Crisis in UK farming due to Brexit and flooding ‘risks
new rise in inflation’ (msn.com)
Covid-19 Corner
This
section will continue until it becomes unneeded.
Could Avian Influenza Be The
Next Covid-19?
May
5, 2024,05:21pm EDT
In
early April, the Centers for Disease Control and Prevention (CDC) notified the
public that an individual in Texas had tested positive for
highly pathogenic avian influenza (HPAI), or bird flu. This person experienced
conjunctivitis — or redness of the eyes — as their only symptom after being
exposed to dairy cattle that were presumed to be infected with HPAI. This was
the second documented human case of avian influenza in the United States since
2022, and has escalated concerns for a large outbreak — or potentially a
pandemic — in the human population.
What Is Highly Pathogenic Avian
Influenza?
Influenza
viruses, which cause annual epidemics of mild to severe respiratory illness,
are not unique to humans. Certain subtypes of influenza circulate among animals,
including birds, swine, horses, dogs and bats. Infection in some animals, such
as wild waterfowl, may be asymptomatic (i.e., no disease results from the infection)
and these animals are considered a natural reservoir for the virus. However,
transmission of the virus to other animals, such as backyard bird flocks or
commercial poultry, may have devastating consequences.
Since
January of 2022, the largest outbreak of avian influenza in recorded history
has occurred worldwide. To date, a subtype of highly pathogenic avian influenza
— known as H5N1 — has been detected in over 9,000 wild birds and has affected
greater than 90 million poultry in the United States.
Recently, the virus has been identified in certain mammals, including dairy
cattle, prompting concern that it may be adapting for more efficient
transmission among mammalian species. Although sequencing studies have not yet
demonstrated this to be the case, the recent human case in Texas has some
asking, “Could avian influenza result in the next pandemic?”
How Is Avian Influenza Different Compared
to Covid-19?
In
early 2020, a novel virus — now known as SARS-CoV-2 — began circulating across
the globe. The human population had no prior immunity to this virus, no
vaccines or treatments existed, and there was limited understanding of how the
virus was transmitted and the mechanisms by which it caused disease. These
factors contributed to the Covid-19 pandemic, which resulted in over 700
million cases and 7 million deaths worldwide. Although HPAI has the potential
to cause a significant outbreak in the human population, there are several
significant differences of HPAI that make a global pandemic on the scale of
Covid-19 less likely.
More
Could Avian Influenza Be The Next Covid-19?
(forbes.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.
A Company Is Building a Giant
Compressed-Air Battery in the Australian Outback
Hydrostor,
a leader in compressed air energy storage, aims to break ground on its first
large-scale plant in New South Wales by the end of this year. It plans to
follow that with an even bigger facility in California.
May 4, 2024
The need for long-duration
energy storage, which helps to fill the longest gaps when wind and solar are
not producing enough electricity to meet demand, is as clear as ever. Several
technologies could help to meet this need.
But which approaches could
be viable on a commercial scale?
Toronto-based
Hydrostor is one of the businesses developing long-duration energy storage that
has moved beyond lab scale and is now focusing on building big things. The
company makes systems that store energy underground in the form of compressed
air, which can be released to produce electricity for eight hours or longer.
I
spoke with Curtis VanWalleghem, Hydrostor’s CEO and cofounder, to get an update
on how close he is to breaking ground on large plants in Australia and
California and to learn how he makes the case for his company.
He
emphasizes the simplicity of his product.
“It’s
a very simple system that just uses a hole in rock [plus] air and water,” he
said. “And then the equipment is all from the oil and gas industry, so you
don’t need new manufacturing or anything.”
Some
background on why long-duration storage matters: The grid of the near future
will require a mix of energy storage resources to fill gaps when there are
lulls in generation from wind and solar. Most lithium-ion battery systems run
for a maximum of four hours. Energy system planners have said the grid will
also need storage options that can run six, eight, and 12 hours, and some that last as long as a day or more.
The Department of Energy has identified
the need for long-duration storage as an essential part of fully decarbonizing the
electricity system, and in 2021 set a goal that research, development, and
investment would help to reduce the costs of the technologies by 90 percent in
a decade.
----Hydrostor’s
first large project to go online is likely going to be Silver City Energy
Storage Centre in Australia, which will have the ability to discharge at 200
megawatts for up to eight hours. Construction should begin around the end of
2024 and the plant should be running by mid-2027, VanWalleghem said.
The
next project would be Willow Rock Energy Storage Center, located near Rosamond
in Kern County, California, with a capacity of 500 megawatts and the ability to
run at that level for eight hours.
More
A Company Is Building a Giant Compressed-Air Battery
in the Australian Outback | WIRED
Finally,
our latest new section, the world global debt clock. Nations debts to GDP
compared.
World Debt
Clocks (usdebtclock.org)
In the history of modern capitalism, crises are the norm, not the exception.
Nouriel Roubini.
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