Wednesday, 14 August 2024

US CPI Day. RBNZ Cuts. Nvidia Challenged. A US Dock Strike Looms.

Baltic Dry Index. 1670 +15       Brent Crude  81.15

Spot Gold 2462             US 2 Year Yield 3.93 -0.08

If there was twenty ways of telling the truth and only one way of telling a lie, the Government would find it out. It's in the nature of governments to tell lies.

George Bernard Shaw.

Today’s headline about says it all.

Short term, the stock casinos will only be interested in today’s US inflation number.

But the in other news section has some very real implications for the US economy and the sky high valuations of the now reduced to “magnificent six” US stocks driving the latest US stocks bubble.

Layoffs are rising in the US economy too, just don’t tell anyone who makes a living out of fleecing the sheep on Wall Street.

Asia-Pacific markets mixed as RBNZ cuts cash rate; Nikkei rises as Kishida to step down in September

Published Tue, Aug 13 2024 7:44 PM EDT

Asia-Pacific markets were mixed on Wednesday as the Reserve Bank of New Zealand cut benchmark lending rates and Japan’s Prime Minister Fumio Kishida announced that he would step down in September.

Kishida said he would not run for reelection as the Liberal Democratic Party leader, pledging his support to the new LDP leader, according to a Reuters translation of his statement in Japanese.

The Reserve Bank of New Zealand unexpectedly cut its benchmark cash rate to 5.25%. Economists polled by Reuters had forecast the central bank would maintain rates at 5.5%.

In South Korea, the country’s seasonally adjusted unemployment rate fell to 2.5% from 2.8% in July, hitting its lowest point since October 2023.

In Japan, business sentiment at manufacturers turned slightly less confident in August compared with the month before, according to the Reuters Tankan survey.

The Tankan survey — which tracks the Bank of Japan’s quarterly survey of the same name — showed that the sentiment index for manufacturers slipped to +10 in August, while the non manufacturers index fell to +24. Both metrics stood at +11 and +26 in July’s survey.

This was due to lackluster demand from China, which weighed on corporate sentiment, Reuters reported, noting that this survey also comes after the Bank of Japan raised its benchmark interest rates in July to their highest level since 2008.

Japan’s Nikkei 225 climbed 0.27% after the announcement by Kishida, while the broad-based Topix rose 0.87%.

South Korea’s Kospi was 0.71% higher, while the small-cap Kosdaq jumped 1.62%.

Australia’s S&P/ASX 200 saw a smaller rise of 0.65%.

The country’s stock regulator is suing the ASX for “making misleading statements” related to its Clearing House Electronic Subregister System, or CHESS, a computer system used to settle trades on the exchange.

The Australian Securities and Investments Commission pointed out the ASX had said the replacement project for CHESS was “on track”, but at the time of the announcements, “the project was not tracking to plan and ASX did not have any reasonable basis to imply the project was on track to meet future milestones.”

Hong Kong’s Hang Seng index inched down 0.14%, but the mainland Chinese CSI 300 was down 0.61%.

Overnight in the U.S., stocks rallied and moved closer to last month’s record levels after data showed producer prices rose less than expected for July.

The producer price index — a measure of wholesale inflation — increased 0.1% last month. Economists expected the reading to show a monthly gain of 0.2% in July, in line with the previous month’s reading, according to Dow Jones consensus estimates.

The Dow Jones Industrial Average climbed 1.04%, at 39,765.64, and the tech-heavy Nasdaq Composite jumped 2.43%.

The S&P 500 added 1.68%, coming to roughly less than 5% from its record high set in July.

Investors will shift their attention to the July consumer price index figures from the U.S. due Wednesday.

Asia stock markets: Japan Tankan, RBNZ rates, South Korea unemployment (cnbc.com)

Stock futures are little changed ahead of key inflation report on Wednesday: Live updates

Updated Tue, Aug 13 2024 7:08 PM EDT

Stock futures were mostly flat on Tuesday evening as Wall Street looks to keep a strong start to the week going with a key inflation report on deck.

Futures tied to the Dow Jones Industrial Average dipped 22 points, or less than 0.1%. S&P 500 futures were also down by less than 0.1%, while Nasdaq 100 futures were little changed.

The modest move in futures comes after a broad rally for stocks on Tuesday. The Dow rose more than 400 points, or about 1%. The S&P 500 climbed 1.7%, while the Nasdaq Composite gained 2.4%.

All three major averages are now above their Aug. 2 closing level, which was the session before the global market sell-off on Aug. 5 that appeared to be related to an unwind of trades in Japan and concerns about economic growth.

The speed of the rebound is making some Wall Street pros uneasy.

“I’m not surprised we bounced back. I’m just surprised by how fast and by how much we bounced back,” Allianz chief economic advisor Mohamed El-Erian said on “Closing Bell.”

The market did get a piece of good news on Tuesday when the producer price index report showed cooler inflation than expected. The consumer price index report on Wednesday could similarly fuel trading moves in the upcoming session.

However, even a lower-than-expected CPI report may not be enough to encourage investors who are concerned by recent signs that the U.S. labor market is softening.

“I think the inflation risk is much lower than the unemployment risk,” El-Erian said.

Stock market today: Live updates (cnbc.com)

In other news.

China’s Huawei is reportedly set to release new AI chip to challenge Nvidia amid U.S. sanctions

Published Tue, Aug 13 2024 11:41 PM EDT

Chinese technology giant Huawei is set to challenge Nvidia with a new artificial intelligence chip amid U.S. sanctions that had sought to curb the Chinese tech giant’s technological progress, according to a Wall Street Journal report.

Huawei told potential clients that its upcoming processor, Ascend 910C, is on par with Nvidia’s H100, the report said, citing people familiar with the matter. Huawei is targeting shipments as early as October.

U.S. regulators in 2022 had slapped restrictions on Nvidia to stop the firm from selling AI chips, including the H100, in China, citing national security concerns.

Potential customers including Chinese internet firms and telecommunications providers are already testing the Ascend 910C chip, the report said, adding that TikTok parent ByteDance, Baidu and China Mobile are among those in early discussions to purchase it.

However, Huawei is facing production delays in its current chips, WSJ said, adding that the firm also faces the prospect of further U.S. restrictions that could impact its ability to obtain machine components and memory chips for AI.

This is the latest sign of Huawei’s ability to fight off American efforts aimed at restricting its access to advanced technology.

Last year, an analysis of Huawei’s Mate 60 Pro smartphone revealed a chip made by China’s top chipmaker SMIC that appeared to support 5G, despite U.S. sanctions that have sought to cut the Chinese tech giant off from the technology.

A resurgence in Huawei’s consumer business, which includes smartphones and laptops, poses a challenge to Apple in China, one of the company’s biggest markets.

Apple was edged out of the top five smartphone vendors’ list in China in the second quarter, as competition from domestic brands such as Huawei intensified, according to a Canalys report.

Huawei has been at the center of U.S. sanctions aimed at securing U.S. networks and supply chains.

In 2018, the U.S. banned its agencies from obtaining Huawei equipment or services.

More

China's Huawei set to release AI new chip to challenge Nvidia, WSJ says (cnbc.com)

Chinese EV maker Zeekr says its new battery can charge faster than that of a Tesla

Published Tue, Aug 13 2024 7:10 AM EDT Updated Tue, Aug 13 2024 8:00 AM EDT

BEIJING — Chinese electric car brand Zeekr announced new batteries on Tuesday, which it says boast the fastest charge in the world.

The offering aims to address consumers’ long-standing worries about battery driving range and ease of charging.

In just 10.5 minutes, Zeekr’s new batteries can go from a 10% to an 80% charge, using the automaker’s ultra-fast charging stations, the U.S.-listed company said. Zeekr said that the new battery could achieve the same charge performance even in negative 10 degree Celsius (14 degrees Fahrenheit) weather in about 30 minutes.

Comparatively, Elon Musk’s Tesla says its supercharger allow the company’s vehicles to charge up to 200 miles in 15 minutes.

The company’s website says the Model 3 can recharge up to 175 miles in 15 minutes, or about 48% of the car’s stated 363 mile-range.

Chinese automaker Nio has also offered the alternative of a three-minute battery swap. The subscription service automatically changes out the battery of designated car models with a charged one at specific swap stations.

Zeekr said that its 2025 007 sedan, which is set to begin deliveries next week, will be the first model to use the new batteries.

The company noted it has opened more than 500 ultra-fast charging stations in China and plans to double that tally by then end of this year. Zeekr aims to operate more than 10,000 ultra-fast charging stations in 2026.

The Geely-owned electric car company delivered a record number of vehicles in June, making its deliveries for the first half of the year the largest among U.S.-listed Chinese companies that only sell pure electric cars. Deliveries fell slightly in July.

Chinese EV company Zeekr says its battery can charge faster than Tesla (cnbc.com)

Labor Talks at US East and Gulf Coast Ports Reach an Impasse

By Laura Curtis  August 12, 2024 at 12:00 PM GMT+1

A labor strike that would halt cargo-handling operations at ports from Houston to Boston just weeks before the US presidential election is looking increasingly likely.

Dueling statements from the United States Maritime Alliance, known as USMX, and the International Longshoremen’s Association on Friday indicate the two sides are still pretty far apart.

USMX, which represents terminal operators and ocean carriers, said it remains ready to continue bargaining, and that the latest offer to dockworkers includes “industry-leading wage increases” and retains the current contract’s language on automation.

Also on Friday, the ILA’s Executive Vice President Dennis Daggett, accused shipping CEOs of “taking home bonuses in the billions” and ocean carriers of raking in profits by “raising rates on their customers due to global conflicts or natural disruptions.”

Automation Dispute

The ILA called off high-level wage talks in June over truck gate technology in use at a Port of Mobile terminal that the union said was in violation of the automation agreement. The union is also demanding significant wage increases to make up for inflation and a share of the extraordinary profits won by ocean liners during the pandemic.

As the summer marches on, ILA President Harold Daggett has repeatedly warned of a strike if no deal is reached by the deadline and last weekend set a meeting in early September for union delegates to discuss wage demands and strike strategies.

Some importers have responded by routing cargo through other ports andstocking up now in case of a disruption ahead of the year-end holidays.

More

Supply Chain Latest: US Port Strike and Labor Talks - Bloomberg

Paramount Global to lay off 15% of U.S. workforce and close TV studio

By Reuters  August 13, 2024 7:35 PM GMT+1

Aug 13 (Reuters) - Paramount Global (PARA.O), opens new tab will begin laying off 15% of its workforce in the United States starting Tuesday and close down its Paramount Television studio as part of a planned restructuring, the media giant said in internal communication.

Paramount, which owns networks like CBS, MTV and Comedy Central, aims to reduce annual costs by $500 million and return to profitable growth ahead of its merger with David Ellison's Skydance Media.

In an internal memo, Paramount's co-CEOs stated that the company is at an "inflection point" where changes are necessary to strengthen the business.

The layoffs, which were announced during a post-earnings call last week, are expected to affect roughly 2,000 people. They will continue through the end of 2024, with 90% of the cuts expected to be completed by the end of September.

Paramount Television Studios (PTVS) will also be shut down as part of the company's broader restructuring plans, President Nicole Clemens said in an email to employees.

George Cheeks, Paramount Global's co-CEO, said the move to close down the studio by the end of the week is the result of major shifts in the television and streaming industry and a need to streamline the company.

All current PTVS series and development projects will be transferred to CBS Studios, Cheeks said, adding that members of CBS teams will also be leaving the company.

The restructuring comes as the New York-based company navigates a challenging linear TV market, having recently written down the value of its cable networks by nearly $6 billion.

U.S. and UK engineers reach mutual recognition agreement | Reuters

Finally, so you really, really, really want an EV. But which batteries are safe?

South Korea to advise automakers to disclose battery information in EVs

By Reuters  August 13, 2024 8:12 AM GMT+1

SEOUL, Aug 13 (Reuters) - South Korea will advise automakers operating in the country to identify batteries used in their electric vehicles, a government statement said on Tuesday, as authorities seek to calm public safety concerns after a series of fires involving EVs.

The government said it had decided to advise car makers to voluntarily disclose the information to reduce fears over fires.

"Such battery information has not been available to the public so far and the measure is to reduce EV owners' fire anxiety," the office of government policy coordination said.

In recent days, some car companies, including Hyundai Motor (005380.KS), opens new tab, Kia Corp (000270.KS), opens new tab, BMW (BMWG.DE), opens new tab Korea and Mercedes-Benz Korea, have started naming the manufacturers of batteries used in cars.

There has been growing public alarm in South Korea over EV car safety since an EV fire ripped through an underground parking lot on Aug. 1 and caused extensive damage.

The blaze, which appeared to start spontaneously in a Mercedes-Benz EV parked under a residential building, took eight hours to extinguish, destroying or damaging about 140 cars and forcing some residents to move to shelters.

Experts say requiring car companies to identify the batteries they use would give consumers more choice, but question how it would improve safety given the lack of definitive data on which battery brands are more prone to fires.

South Korea to advise automakers to disclose battery information in EVs | Reuters

Disposal of batteries in spotlight after recycling centre fire

Tue, 13 August 2024 at 6:00 am BST

The disposal of batteries is in the spotlight after an investigation into a huge blaze at a Suffolk recycling centre established a battery was the most likely cause.

Suffolk Fire and Rescue Service revealed the cause of the fire at the Sackers Recycling Centre in Great Blakenham, near Ipswich, on Monday.

An investigation found the blaze, which was attended by almost 80 firefighters at its height, was most likely caused by a battery which made its way into a pile of scrap metal.

Around 80 firefighters were at the scene at the height of the fire (Image: OBD Photography)

Councillor Steve Wiles is urging residents to learn from the incident after the cause was revealed (Image: Suffolk County Council)

It has shed more light on the issue of disposing batteries in the correct way across the county.

Councillor Steve Wiles, Suffolk County Council cabinet member for public protection, said: “This was a major incident that caused massive disruption to a great many people and saw firefighters put themselves potentially in harm’s way as they bravely dealt with it.

“We all use batteries, we all benefit from them, and therefore it is everyone’s responsibility to dispose of them safely.

“I would urge people to learn from this incident – please, when you get rid of a battery, do it properly.”

The fire was most likely caused by a battery (Image: SFRS)

More

Disposal of batteries in spotlight after recycling centre fire (yahoo.com)

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 grocery inflation edges higher after 17 months of decline

By James Davey  August 13, 2024 8:09 AM GMT+1

LONDON, Aug 13 (Reuters) - UK grocery inflation edged higher this month for the first time since March 2023, industry data showed on Tuesday.

Market researcher Kantar said annual grocery price inflation was 1.8% in the four weeks to Aug. 4, versus 1.6% in the previous four week period.

“Having reached its lowest rate in almost three years in July, August saw inflation nudge up again slightly," Fraser McKevitt, head of retail and consumer insight at Kantar, said.

"While this is noticeable following 17 straight months of falling rates, it actually marks a return to the average levels seen in the five years before the start of the cost of living crisis.”

The British Retail Consortium warned last month that renewed inflationary pressures could be on the way as the effect of last year's fall in commodity prices fades and climate change damages harvests following unusually wet weather in England and extreme heat elsewhere.

Kantar said prices are rising fastest in markets such as vitamin and mineral supplements, fruit juices and drinks and chocolate confectionery and are falling fastest in toilet tissues, bottled cola drinks and dog food.

Official data published last month showed overall UK inflation held at 2% in June, lower than in the United States and the euro area. Data for July will be published on Wednesday and is expected to show an increase.

Kantar's data, the most up-to-date snapshot of UK consumer behaviour published since the July 4 national election, showed take-home grocery sales rose 3.8% in value terms over the four-week period year-on-year.

It said sales of wine, beer and snacks were boosted by the closing stages of the Euro 2024 soccer championship and the start of the Paris Olympics. Barbecue food sales were boosted by the return of some better weather.

More

UK grocery inflation edges higher after 17 months of decline | Reuters

There's a 40% chance the US economy is already in a recession, according to a new indicator

August 12, 2024

There's a new recession indicator that's making waves, and it says there's a 40% probability the US is already in a recession.

The economists Pascal Michaillat and Emmanuel Saez recently released the details of a recession indicator that builds on the widely cited Sahm rule.

The Sahm rule, named for its creator, the economist Claudia Sahm, uses the difference between the three-month moving average of the unemployment rate and the past-12-month low. If the difference is at least 0.5 percentage points, the US is in a recession.

The rule was triggered this month when the July jobs report showed a 4.3% unemployment rate (though Sahm herself has said she doesn't think the US is in a recession).

Michaillat and Saez's measure uses a similar methodology, but it's two-sided, using unemployment and the vacancy rate for jobs.

The measure uses the Sahm rule's procedure for unemployment and pairs it with the difference between the three-month moving average of the vacancy rate and its past-12-month maximum.

When the indicator shows a difference of 0.3 percentage points, a recession may have started. A difference of 0.8 points is a definite recession.

Using data from July, the indicator is at 0.5 percentage points, nodding to a 40% probability of a recession that could have started as early as March, Michaillat and Saez said in a paper.

The economists added that the indicator worked for recessions going back to 1930, while Sahm's worked only back to 1960.

A new indicator could help economists and investors better understand if a downturn is imminent. Though the July jobs report triggered the rule she pioneered, Sahm said she wasn't sure it was accurate this time around.

"This pandemic cycle has been different on so many dimensions and has laid waste to so many economic models and rules of them," Sahm said in an interview with Business Insider last week. "If the Sahm rule was going to fail, it's going to be this time."

She added that having such a negative effect tied to one's name was a hefty burden and that she's been waiting for a more accurate rule to come along.

"What I am so looking forward to is someone deciding it's great to have something like this and is motivated and goes off and does it better," Sahm said.

There's a 40% chance the US economy is already in a recession, according to a new indicator (msn.com)

Covid-19 Corner

This section will continue until it becomes unneeded.

Over half of US states reporting 'very high' COVID activity levels, CDC data shows

August 12, 2024

More than half of U.S. states are reporting "very high" levels of COVID activity as the virus continues to spread and increase in many parts of the country, according to the latest wastewater data from the Centers for Disease Control and Prevention.

At least 27 states are reporting "very high" levels and 17 states are reporting "high" levels of wastewater viral activity.

The western region continues to see the highest levels followed by the South, Midwest and Northeast, respectively.

Current levels are nearing but remain lower than what they were in the winter months, when there tends to be increased spread of respiratory illnesses.

Wastewater data comes with limitations in how well it represents spread in a community, but it may be the best data available, experts say.

"While wastewater is not a perfect measure, it's increasingly vital in filling the gaps left by the absence of comprehensive case reporting and hospitalization data," said Dr. John Brownstein, an epidemiologist and chief innovation officer at Boston Children's Hospital and an ABC News contributor.

Many national surveillance systems have diminished in scope since the national public health emergency ended, leaving authorities will limited resources to monitor how the virus is spreading.

"As traditional surveillance systems have dwindled, wastewater analysis has emerged as one of the most reliable tools we have to monitor COVID-19 activity in communities," Brownstein added.

Other limited COVID surveillance systems such as emergency department visits and test positivity are also on the rise, according to CDC data. Deaths from the virus remain relatively flat, especially compared to previous years.

Updated COVID vaccines are set to be available this fall, according to federal health authorities. The U.S. Food and Drug Administration recommended that vaccine manufacturers formulate shots based on the KP.2 strain, an offshoot of the omicron variant that is currently estimated to make up about 6% of cases.

Genetically similar variants, known as KP.3.1.1 and KP.3, currently make up almost half of estimated cases, CDC data shows.

The CDC has already recommended that everyone over the age of 6 months get an updated COVID vaccine this season. The recommendation will take effect as soon as the vaccines are made available, pending FDA authorization.

An expected delivery date for the updated COVID vaccines has not been shared yet, but in previous years the shot was made available in late August or September. Vaccine manufacturers have told ABC News they are ready to ship doses as soon as they receive the green light from the FDA.

Over half of US states reporting 'very high' COVID activity levels, CDC data shows (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.

Are digital landlines more dangerous for the public?

Mobile operators resist plan to ensure networks have emergency power during outages

12 August, 2024

Mobile operators are resisting plans to ensure their networks have power during extreme weather or cyber attacks amid fears over “prohibitive” costs.

BT, Vodafone, Virgin Media and O2 would be required to provide at least one hour of battery back-up power at all their mobile mast sites under new guidance being considered by regulator Ofcom.

The watchdog has said tougher measures are needed to improve the resilience of critical networks, as they come under growing pressure from volatile weather and hackers. 

It has warned that the fallout from network outages is “likely to become more severe as society becomes increasingly dependent on them to function”.

However, mobile network operators have pushed back against the potential new rules, which are expected to cost the industry up to £1.8bn.

In responses to Ofcom’s consultation, BT, Vodafone and VMO2 warned it would be “disproportionate” for providers to bear the costs of the measures alone. 

Smaller rival Three branded the costs “prohibitive”.

BT suggested that operators could be encouraged to invest more in their networks if Ofcom reduced the annual fees it charges for use of mobile spectrum.

The companies also questioned the need for the measures, arguing that the impact of short-term power outages was minimal and could be largely mitigated by nearby sites.

They have also urged regulators to focus on better resilience in the grid.

Mobile firms currently provide battery back-up at sites, but the extent of coverage and duration of reserve power varies significantly across networks. 

In addition to requiring one hour of battery back-up at all mobile sites, Ofcom’s suggested rules could also enforce four hours of back-up in broadband cabinets. 

The calls for greater resilience come amid concerns that Britain’s crucial communications networks may be increasingly vulnerable to crises.

Ofcom pointed to extreme weather events such as storms and floods in the winter of 2021/2022, which left some communities without any means to communicate, including making calls to emergency services.

This has been exacerbated by the switchover from copper to digital landlines, which are more liable to failure in the event of power outages.

BT has delayed its rollout of the new technology following a number of serious incidents where so-called “telecare” devices – personal alarms designed to be activated in a health emergency or after a fall – failed because of digital landlines.

An Ofcom spokesman said: “We haven’t made any proposals at this stage – the costs we included in our call for input were part of an illustrative example only. 

“We’re considering the responses we’ve received, and we’ll work with industry and Government to identify and pursue ways to address any potential issues.”

Mobile operators resist plan to ensure networks have emergency power during outages (msn.com)

Next, the world global debt clock. Nations debts to GDP compared.  

World Debt Clocks (usdebtclock.org)

A socialist is somebody who doesn't have anything, and is ready to divide it up equally among everybody.

George Bernard Shaw.

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