Baltic
Dry Index. 1973 -24 Brent Crude 86.06
Spot Gold 2328 US 2 Year Yield 4.71 +0.01
In
the run up to the UK General Election on July 4, the LIR will play its part.
A government that robs Peter to pay Paul can always depend on the support of Paul.
George Bernard Shaw. Socialist.
Has
the US hi-tech bubble burst? While one swallow doesn’t make a summer, a journey
of a thousand miles starts with a single step.
Worryingly,
US banks are quietly selling off commercial real estate loans. What do they
know that we don’t?
I
think the US economy dropped into recession in April or just possibly May. For
more on that see the weekend LIR update.
With
political turmoil coming to Europe, starting France on Sunday, followed by GB
on July 4th, leading up to the big one in the USA on Guy Fawkes Day,
November 5th, sell in May, go away, looks to have been the right
advice for a change.
Asia-Pacific markets mostly gain after U.S. tech
sell-off pushes key Wall Street indexes lower
Asia-Pacific markets mostly rose Tuesday, while
investors sold-off U.S. Big Tech stocks overnight in favor of sectors such as
banking and energy.
Tech darling Nvidia dropped
6.7% on Monday and was one of the biggest contributors to the Nasdaq’s losses.
Information technology was the S&P 500′s worst-performing sector, down more
than 2%.
Investors in Asia assessed South Korea’s consumer sentiment index for June,
as well as Japan’s service sector producer prices.
The services producer price index for Japan climbed
2.5% year on year in May, compared with the 2.7% rise in April.
South Korea’s consumer confidence
index climbed in June to 100.9 from 98.4 in May. This comes amid growing
optimism about living standards and future household income, as well as
domestic economic conditions.
Japan’s Nikkei 225 gained
0.51% while the broad-based Topix rose 1.44%.
South Korea’s Kospi gained
0.42% while the small-cap Kosdaq reversed gains to a 0.52% drop.
The Taiwan Weighted
Index pared
some losses and was last down 0.29%.
Hong Kong Hang Seng index was
up 0.74% while mainland China’s CSI 300 advanced 0.16%.
Reuters reported the Biden
administration is probing three Chinese telecommunications firms over
worries that Beijing could access American data through these firms’ cloud and
internet businesses in the U.S.
All three firms named in the
Reuters report – China Mobile, China Telecom and China Unicom – gained in
morning trade.
Australia’s S&P/ASX 200 rose
0.92%.
Overnight in the U.S., the Dow Jones Industrial Average added 0.67%, while the S&P 500 slid 0.31%. The tech-heavy Nasdaq Composite saw its worst day since April, sliding 1.09%.
Asia stocks: Japan
PPI, South Korea consumer sentiment index, Nvidia sell-off (cnbc.com)
European stocks set to open lower after
sentiment sours on Wall Street
LONDON — European stocks are expected to open
lower Tuesday, following souring U.S. market sentiment at the start of the
week.
The U.K.’s FTSE index
is seen opening 16 points lower at 8,284, Germany’s DAX 130
points lower at 18,207, France’s CAC 40 down
32 points at 7,678 and Italy’s FTSE MIB down
55 points at 33,982, according to data from IG.
Global markets have turned lower
after investors stateside sold off U.S. Big Tech stocks on Monday in favor of
sectors such as banking and energy.
Tech darling Nvidia dropped 6.7%
on Monday and was
one of the biggest contributors to the Nasdaq’s losses. Information
technology was the S&P 500′s worst-performing sector, down more than 2%.
Asia-Pacific markets mostly
rose overnight, with traders assessing South Korea’s consumer sentiment index
for June, as well as Japan’s service sector producer prices.
In Europe Tuesday, there are no
major earnings. Spanish gross domestic product data will be the main major
economic release.
European
markets: stocks, news, data and earnings (cnbc.com)
Morning Bid: Tech rout
drives flight to value
By Reuters June 25, 2024 5:40 AM GMT+1
A look at the day ahead in
European and global markets from Kevin Buckland:
Some payback may be coming for European stocks on Tuesday,
following the gains that kicked off the week.
Look for tech to take an outsized hit, after Nvidia's slump (NVDA.O)led a sell-off for the
high-flying chip sector on Wall Street. To recap, the S&P 500 (.SPX) lost 0.3% on Monday, versus
a more than 1% drop for the Nasdaq (.IXIC), with the SOX semiconductor
index (.SOX)sliding more than 3%.
But tech's loss has been
value's gain, exemplified by the 0.7% rise in the Dow (.DJI).
That rotation has been the theme in Asia overnight. As an
example, AI darlings on Japan's Nikkei 225 like SoftBank Group (9984.T)are pulling back from
highs, while cash pours back into beaten-down Toyota Motor (7203.T).
The positive news for equity investors is that overall,
Asia-Pacific stock indexes are higher. Only tech-heavy Taiwan (.TWII) is underwater among the
major benchmarks. And while the Nikkei (.N225) is up only half a percent,
the broader Topix (.TOPX)has rallied nearly 1.5%.
Geopolitics also bear close
attention. With the first round of voting in France's snap elections looming
this weekend, sentiment could turn quickly.
For now, the far right's overtures to the markets have
been effective in allaying fears about a lack of fiscal restraint.
More
Morning Bid: Tech rout drives flight to value | Reuters
In other news, rising commercial real estate problems in US banks. What happens when recession hits, if it hasn’t already started?
Fearing
Losses, Banks Are Quietly Dumping Real Estate Loans
June 24, 2024
Some Wall Street banks, worried that
landlords of vacant and struggling office buildings won’t be able to pay off
their mortgages, have begun offloading their portfolios of commercial real
estate loans hoping to cut their losses.
It’s an early but telling sign of the
broader distress brewing in the commercial real estate market, which is hurting
from the twin punches of high interest rates, which make it harder to refinance
loans, and low occupancy rates for office buildings — an outcome of the
pandemic.
Late last year, an affiliate of
Deutsche Bank and another German lender sold the delinquent mortgage on the
Argonaut, a 115-year-old office complex in midtown Manhattan, to the family
office of the billionaire investor George Soros, according to court filings.
Around the same time, Goldman Sachs
sold loans it held on a portfolio of troubled office buildings in New York, San
Francisco and Boston. And in May, the Canadian lender CIBC completed a sale of
$300 million of mortgages on a collection of office buildings around the
country.
“What you are seeing right now are one-offs,” said Nathan
Stovall, director of financial institutions research for S&P Global Market
Intelligence.
Mr. Stovall said sales were picking up as “banks are
looking to shrink exposures.”
In terms of both number and value, the troubled
commercial loans that banks are trying to offload are a sliver of the roughly
$2.5 trillion in commercial real estate loans held by all banks in the United
States, according to S&P Global Market Intelligence.
But these steps indicate a grudging acceptance by some
lenders that the banking industry’s strategy of “extend and pretend” is
running out of steam, and that many property owners — especially
owners of office buildings — are going to default on mortgages. That
means big losses for lenders are inevitable and bank earnings will suffer.
Banks regularly “extend” the time that struggling
property owners have to find rent-paying tenants for their half-empty office
buildings, and “pretend” that the extensions will allow landlords to get their
finances in order. Lenders also have avoided pushing property owners to
renegotiate expiring loans, given today’s much higher interest rates.
But banks
are acting in self-interest rather than out of pity for borrowers. Once a bank
forecloses on a delinquent borrower, it faces the prospect of a theoretical
loss turning into a real loss. A similar thing happens when a bank sells a
delinquent loan at a substantial discount to the balance owed. In the bank’s
calculus, though, taking a loss now is still better than risking a deeper hit
should the situation deteriorate in the future.
More
Fearing Losses,
Banks Are Quietly Dumping Real Estate Loans (msn.com)
Finally, another update on all those EV fires.
Blaze in South Korea
battery plant kills 22 workers
By Daewoung Kim and Hongji
Kim June 24,
2024 12:22 PM GMT+1
HWASEONG, South Korea, June 24 (Reuters) - Multiple powerful explosions
set a lithium battery factory on fire in South Korea on Monday, killing 22
workers, most of them Chinese nationals, as it burned out of control for nearly
six hours, fire officials said.
The blaze ripped through a factory run by primary battery manufacturer
Aricell in Hwaseong, an industrial cluster southwest of the capital Seoul. It
was eventually largely extinguished.
Eighteen Chinese workers and one Laotian were among the dead. The
nationality of the remaining deceased worker was not yet confirmed, fire
official Kim Jin-young told reporters, citing information from company
officials.
The blaze began at 10:31 a.m. (0131 GMT) after a series of battery cells
exploded inside a warehouse with some 35,000 units, Kim said. What had
triggered the explosion remains unclear, he said.
A Reuters journalist saw firefighters moving up to six bodies out of the
factory. Due to the intensity of the blaze, rescuers were finding it difficult
to identify the dead, Kim said.
Two people were being treated for major burns, officials at the scene
said.
Live TV footage showed firefighters spraying the damaged steel and
concrete building. Parts of the upper level had collapsed, and large chunks of
the building looked like they had been blown out into the street by explosions.
Aerial footage showed massive white smoke clouds
billowing from the structure and explosions rolling through the building.
Kim Jae-ho, Fire and Disaster Prevention professor at
Daejeon University, said the fire had probably spread too quickly for workers
to escape.
More
Blaze in South Korea battery plant kills 22 workers | Reuters
Below, EV car fires. Approx. 10 minutes.
Shocking:
EVs Are Catching Fire at Alarming Rates! | The Hidden Danger Exposed
Shocking: EVs Are Catching Fire at Alarming Rates! | The Hidden Danger Exposed - YouTube
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.
Today,
more signs that many US consumers are spent out.
California Reveals All Job
Gains In 2023 Were Fake
MONDAY, JUN 24, 2024 - 03:14 AM
In the past year we have
discussed on multiple occasions that US labor market data has been repeatedly
doctored to artificially appear better than it really is (see "Here Is The "Unexpected" Reason Why The Fed
Will Rush To Cut Rates As Soon As Possible", "Philadelphia Fed Admits US Payrolls Overstated By At
Least 800,000" and "Here Comes The Job Shock: Philadelphia Fed Admits US Jobs
"Overstated" By At Least 1.1 Million"), although thanks to a quirk of BLS data revision
reporting, we won't have definitive proof of just how ugly the real job
market has been in recent years until some time in 2025, well into Trump's
second administration.
However, while the BLS
will be able to maintain the facade of "strong job gains" lies into
early 2025, the dismal reality has already made an appearance in America's
largest labor market.
According to the latest report published by the non-partisan
California Legislative Analyst's Office (LAO) which is an agency of the California government, is
overseen by the Joint Legislative Budget Committee of the California State
Legislature, and performs and publishes extensive analyses of the state's
budget in addition to providing fiscal and policy advice to the California
Legislature, contrary to prior reports of over substantial job
gains in the deep blue state in 2023, the reality was far uglier.
In a report titled "Newest Early Jobs Revision Shows No Net Job Growth During 2023" we learn just that: the Early Revisions to
state-level data flagged here previously, suggests that California
actually lost jobs during the fourth quarter of last
year. As the report details, "based on the most recent release of
the early benchmarks, payroll jobs declined by 32,000 from September 2023
through December 2023. On the contrary, the preliminary monthly reports showed
a solid increase in job growth (+117,000 jobs) at the time."
This, according to the
LAO, means that "with the fourth quarter revision, calendar
year 2023 saw essentially no net job growth (+9,000 jobs overall)."
More
California Reveals All Job Gains In 2023 Were Fake | ZeroHedge
McDonalds introduces
Free Fries Fridays to win back inflation-weary customers
The
company also said its $5 meal deal will start next week
Updated Thursday 7:00PM
McDonald’s announced Thursday that customers who spend a minimum of $1 on Fridays
will receive free fries with their order, as part of its effort to win
back inflation-scorned customers.
“We heard our fans
loud and clear — they’re looking for even more great value from us, and this
summer that’s exactly what they’ll get,” Joe Erlinger, President of McDonald’s
USA, said in a statement announcing the initiative.
The Chicago-based fast-food giant said that the
french fry deal is only for customers with the McDonald’s app, which is free to
download, and will run through the end of 2024.
It also said its much-hyped $5 deal will begin on June 25, allowing
customers to order a small fries, 4-piece Chicken McNugget, a small soda, and
choose between a McDouble or McChicken sandwich for
just $5. That deal is scheduled to run through the summer at select
locations.
Sara Senatore, Bank of America’s senior analyst for
restaurants, said
in May that the promotions could help win back customers frustrated by
the increasing cost of fast food.
---- The news comes as the fast-food companies are
battling the so-called “value wars,” all attempting to reel in cash-strapped
customers looking to save money at their favorite chains.
Starbucks recently announced its “Pairings Menu,”
which gives customers a drink and breakfast item for a fixed price between $5
and $7. And Burger King has followed suit with own $5 value meal.
McDonalds introduces Free Fries Fridays and $5 meal deal (qz.com)
Covid-19 Corner
This section will continue until it becomes unneeded.
Today, something a little
different.
Immune cell discovery: "The potential to be used
for almost everything"
Paul McClure June 18, 2024
A
new study has overturned traditional thinking about regulatory T cells, which
suppress the body’s inflammatory response, and has significant implications for
treating a wide range of conditions, from repairing injured muscles to
regrowing hair.
As their name suggests, regulatory T cells, or
Tregs, are a type of white blood cell that actively regulate or suppress the
body’s immune response. They stop the immune system from overreacting, keeping
it in check by controlling inflammation and protecting against autoimmune
diseases in which the immune system mistakenly
attacks healthy tissues.
Traditionally, Tregs were thought to be
specialist cell populations found only in specific areas of the body. However,
a new study by scientists from the University of Cambridge in the UK has overturned
traditional thinking, with significant implications for treating a wide range
of diseases and injuries that trigger an immune response.
It’s difficult to
think of a disease, injury or injection that doesn’t involve some kind of
immune response, and our finding really changes the way we could control this
response,” said Professor Adrian Liston from the University’s Department of
Pathology and the study’s corresponding author. “We’ve uncovered new rules of
the immune system. This ‘unified healer army’ can do everything – repair
injured muscle, make your fat cells respond better to insulin, regrow hair
follicles. To think that we could use it in such an enormous range of diseases
is fantastic: it’s got the potential to be used for almost everything.”
Lymphoid organs are
integral parts of the immune system, responsible for producing lymphocytes, a
type of white blood cell that includes T cells. T cells begin life in the bone
marrow and then move to the thymus, an organ in the upper mid-chest, where they
mature into specialized subsets, including Tregs. Once fully matured, T cells
are exported to peripheral lymphatic tissues and organs like the spleen,
tonsils, and lymph nodes (some move to the bloodstream). It was thought that’s
where Tregs stayed, on ‘standby’ until called upon by the immune system.
To test this, the
researchers analyzed the Tregs present in 48 different tissues in mice,
including lymphoid and non-lymphoid tissues and tissues associated with the
gut. They found them in all tissue types, suggesting that Tregs weren’t
specialized cell populations confined to lymphoid tissues but moved around the
body, executing repair functions in areas that need it.
“Now that we know
these regulatory T cells are present everywhere in the body, in principle we
can start to make immune suppression and tissue regeneration treatments that
are targeted against a single organ – a vast improvement on current treatments
that are like hitting the body with a sledgehammer,” Liston said.
More
Immune cell discovery: "The potential to be used
for almost everything" (newatlas.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.
Energy-positive
laser fusion approach heads toward commercialization
David Szondy June 19, 2024
With the promise of unlimited energy, Xcimer has raised over
US$100 million from investors and the US Department of Energy to develop a
high-energy laser system that's intended for use in a practical fusion power
plant.
---- At first, this seems like a great breakthrough, and in
many ways it is. Unfortunately, the LLNL installation is designed primarily for
pure research. Its only practical application is to carry out fusion
experiments to assure the safety and reliability of American nuclear warheads.
It isn't designed as a way to achieve a practical fusion power plant.
That is where
Xcimer Energy comes in. Since 2022, the Denver-based company has been working
to turn the laser fusion concept into a practical source of power. The goal is
to produce a new krypton-fluoride laser installation that generates 10 times
higher laser energy at 10 times higher efficiency and over 30 times lower cost
per joule than the NIF.
Using technology
first developed for the US Strategic Defense Initiative (nicknamed the Star
Wars program) in the 1980s, the Xcimer installation will use a laser system
producing over 10 megajoules of energy. This will be focused on larger
deuterium/tritium pellets that are easier to make and handle, and produce more
energy when ignited.
Producing energy is
useless if it isn't harnessed, so the fusion chamber has molten lithium salts
flowing through it, not only to protect the wall from neutrons, which reduces
maintenance, but to absorb the energy and carry it away to generate power.
The idea is that
the lasers will stand at a distance of 164 ft (50 m) and focus their beams
through two small holes to reach the target pellet. The system is designed to
ignite only a small amount of the fuel, which produces the energy needed to
ignite the remainder like a match set to paper. This is more efficient and
economical.
"The benefits
of fusion for humanity have never been more clear or more necessary," said
Mark Cupta, Xcimer board member. "Xcimer has developed a game-changing
approach to inertial fusion and assembled a team of the brightest minds in the industry
to execute on it. I’m confident that with Xcimer leading us on this path, the
world will see this transformative source of energy finally deployed at
commercial scale."
Energy-positive laser fusion approach heads toward
commercialization (newatlas.com)
Next, our
latest new section, the world global debt clock. Nations debts to GDP compared.
World Debt
Clocks (usdebtclock.org)
The longer I live, the more convinced am I that this planet is used by other planets as a lunatic asylum.
George Bernard Shaw. Socialist.
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