Baltic
Dry Index. 1976 +86 Brent Crude 74.68
Spot Gold 2593 US 2 Year Yield 3.59 -0.02
The chief evil is unlimited government, and nobody is qualified to wield unlimited power.
Friedrich August von Hayek.
In the stock casinos, it’s party time again. The US central banksters just brought out the punch bowl again, and just in time for the US elections too, what a lucky coincidence.
In reality, the Great Disconnect between the stock casinos and an approaching economic calamity, just gets wider and wider.
Another 1929 looms, but don’t let on to Wall Street’s risk on party goers.
Look away from that rapidly flattening US treasury yield curve now.
Japan’s Nikkei leads gains in Asia after Wall
Street soars; BOJ and PBOC hold rates
Published Thu, Sep 19 2024 7:55 PM EDT
Most Asia-Pacific markets opened higher on
Friday with Japan’s Nikkei 225 leading gains, after Wall Street soared
overnight following the Federal Reserve’s outsized rate cut.
The Bank of Japan kept its benchmark
interest rate steady at around 0.25% — the highest rate since 2008 — at the
conclusion of a two-day meeting Friday.
Japan’s core consumer prices index climbed 2.8% year on year,
in line with Reuters estimates, versus a 2.7% rise in the previous month.
Excluding fresh food and energy, the inflation figure was 2%, versus 1.9% in
the previous month.
The reading will be the last gauge of the
economy before the BOJ concludes its two-day monetary policy meeting, where
it’s expected to keep interest rates unchanged at 0.25%.
The Japanese yen firmed 0.30% against the
greenback to 142.20.
China also did not tinker with its key lending rates, with the one-year loan prime rate —
which affects corporate and most household loans — at 3.35% and the five-year
LPR — a reference for mortgage rates — at 3.85%.
Japan’s Nikkei 225 jumped 1.87% and
the broad-cased Topix added 1.48%.
Hong Kong’s Hang Seng index advanced
1.45%, and mainland China’s blue chip CSI 300 edged 0.27% lower.
South Korea’s blue chip Kospi gained 0.87%
and the small-cap Kosdaq was up 1.28%.
Australia’s S&P/ASX 200 edged up
0.25%.
Overnight in the U.S., all three major
indexes ended higher with the Dow Jones Industrial Average rising 1.26% to
close at 42,025.19, crossing the 42,000 threshold for the first time.
The S&P 500 added 1.7% to end at
5,713.64, topping 5,700 for the first time.
The Nasdaq Composite surged
2.51% to finish at 18,013.98.
The three major averages are on pace for
weekly gains, with the S&P 500 up nearly 1.6% through Thursday’s close. The
Dow is toting a 1.5% jump on the week, while the Nasdaq is outperforming with a
1.9% advance.
Most Asia-Pacific markets: Bank of Japan, PBOC, Japan CPI, Fed rate cut (cnbc.com)
Dow futures are little changed after index closes
above 42,000 for the first time: Live updates
Updated Fri, Sep 20 2024 8:13 PM EDT
Dow futures flickered near the flatline
Thursday night after the 30-stock average closed at a new record, bolstered by
enthusiasm over the Federal Reserve’s interest rate cut.
Dow futures were little
changed. Futures tied to the
S&P 500 inched lower by 0.1%, while Nasdaq 100 futures slipped
0.2%.
Shipping behemoth FedEx pulled back 11% in
extended trading after the company slashed the top end of its full-year
earnings outlook and trimmed its revenue guidance. Nike surged more than 7% after
announcing that CEO John Donahoe will
step down from his post on Oct. 13.
Stocks surged during Thursday’s regular
session, with the S&P 500 rising
1.7% to close over the 5,700 level for the first time. The blue-chip Dow ended the day more than
500 points higher to post its first-ever close above 42,000. Both indexes also
registered all-time highs during the day. The Nasdaq Composite advanced
2.5%.
Unemployment data, along with the Fed’s
half-point rate cut on Wednesday, seemed to bolster investors’ sentiment.
Initial jobless claims, which came in at 219,000 for the week of Sept. 14, were
lower than expected and showed a decline from the prior week.
“The first economic data point since the
‘jumbo’ rate cut should please the Fed,” said Chris Larkin, managing director
of trading and investing for E-Trade from Morgan Stanley. “Lower-than-expected
jobless claims won’t raise any immediate concerns about the labor market
slowing too much.”
The Fed’s Wednesday decision marked the
first rate cut since 2020.
The three major averages are on pace for
weekly gains, with the S&P 500 up nearly 1.6% through Thursday’s close. The
Dow is toting a 1.5% jump on the week, while the Nasdaq is outperforming with a
1.9% advance.
Stock market today: Live updates (cnbc.com)
In other news, stormy weather ahead and an iceberg approaching.
Port strike on US East Coast would spark supply-chain glitches from outset, shipping firm exec says
September 18, 2024
LOS ANGELES (Reuters) - A threatened Oct.
1 strike by dockworkers at ports on the U.S. East Coast and Gulf of Mexico
would immediately disrupt the flow of goods in the country, the North America
chief executive of French container carrier CMA CGM said on Wednesday.
The International Longshoremen's
Association union represents 45,000 workers at 36 ports including New York/New
Jersey, Houston and Savannah, Georgia. The union has vowed to stop work if it
does not have a new labor agreement in place when the current six-year contract
expires on Sept. 30 at midnight.
"The moment you close the door,
things begin to back up," George Goldman, CMA CGM's North America chief,
said on a webcast hosted by the Port of Los Angeles.
"One day is too long" for port
closures, he said.
CMA CGM is a member of the United States
Maritime Alliance employer group that is negotiating with the ILA.
The ports that stand to be affected handle
about half of U.S. imports. Worried retailers, manufacturers and other ocean
shippers have been shifting some cargo to the West Coast to cut the chance of
having cargo stuck at idled facilities.
Analysts at Sea-Intelligence, a
Copenhagen-based shipping advisory firm, estimate it could take anywhere from
four to six days to clear the backlog from a one-day strike.
A two-week strike could mean that ports
would not return to normal operations until 2025, Sea-Intelligence said.
Goods from Europe, India and other
countries that rely on direct routes across the Atlantic Ocean would be most
heavily affected, transportation experts said.
Meanwhile, imports to the busiest U.S.
West Coast ports are surging.
That is because customers of CMA CGM,
Maersk and other large container carriers also have been rushing in stocks of
Halloween costumes and Christmas apparel before any potential labor action. At
the same time, manufacturers have been loading up on solar panels and other
goods targeted for potential tariff increases.
The Port of Long Beach in August notched
the busiest month in its 113-year history, with volume jumping nearly 34% from
the year earlier, bolstered by a 40% surge in imports.
The neighboring Port of Los Angeles
reported an August volume jump of 16%, fueled by a nearly 18% jump in imports.
Gene Seroka, executive director for the
Port of Los Angeles, said the bump from cargo shifts from other ports is hard
to quantify. Still, he said Los Angeles can handle about 1.2 million 20-foot
equivalent units per month, versus the 960,597 TEU processed in
August.
"We can handle this cargo,"
Seroka said.
CEOs Scale Back Hiring Plans Amid Weaker Sales
Projections, Cooling Economy
CEOs are scaling back hiring plans and
anticipating slower sales as the US economy shows signs of cooling.
9/18/2024 Updated: 9/18/2024
America’s corporate leaders plan to pull
back on hiring over the next six months and expect a slowdown in sales,
according to a survey of CEOs, which comes as cooling in the jobs market has
prompted the Federal Reserve to deliver a significant 50 basis-point rate cut.
The Business Roundtable’s CEO Economic
Outlook Survey, released on Sept. 18, paints a picture of a softening labor
market and expectations for a decline in consumer spending.
The survey’s composite index, which
measures CEO expectations for capital spending, hiring, and sales over the next
six months, fell five points, to 79, in the latest survey. This marks the first
time that the index has dipped below its historical average of 83 this year.
The drop in the index is largely driven by
reduced hiring expectations and a sharp decrease in anticipated sales, despite
a slight uptick in capital investment plans.
“This is the second consecutive quarter in
which CEOs have reported they are moderating their hiring plans,” Business
Roundtable CEO Joshua Bolten said in a statement.
Capital-investment plans showed a slight
improvement, with the subindex tracking capital expenditures rising by three
points, to 73. Bolten said this signals ongoing near-term business investment
in things such as equipment and technology, which drive growth and
productivity.
Sales expectations took a significant hit,
however, with the sales subindex falling 13 points, to 110, in the latest
survey. This suggests that CEOs are increasingly concerned about moderating
demand for goods and services as the economy cools.
CEOs also reported more cautious hiring
plans over the next six months, with the hiring subindex falling by five
points, to 55. Despite the slowdown, less than 30 percent of the surveyed
executives indicated they plan to cut headcount, a figure that is not far below
the historical average. In addition, 37 percent of CEOs said they expect no
change in their workforce, while 34 percent expect to increase hiring.
The decline in sales expectations could be
influencing companies’ more conservative hiring strategies, with Bolten saying
that the survey results seem broadly “consistent with the Fed’s perspective on
a softening economy.”
The CEOs surveyed by the Business
Roundtable predicted that the U.S. gross domestic product (GDP) would grow 2.3
percent for all of 2024. That’s a slightly faster pace of growth than the
2.0 percent that Federal Reserve policymakers expect, according to the central
bank’s latest economic projections, released on Sept. 18, as the Fed delivered
an unusually large 50 basis-point rate cut, citing deteriorating labor market
conditions.
“In the labor market, conditions have
continued to cool. Payroll job gains averaged 116,000 per month over the past
three months, a notable stepdown from the pace seen earlier in the year,”
Federal Reserve Chair Jerome Powell said at a Sept. 18 press conference that
followed the announcement of a rate cut—the first in four years.
More
CEOs
Scale Back Hiring Plans Amid Weaker Sales Projections, Cooling Economy | The
Epoch Times
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.
Fed
rate cuts are arriving too late and layoffs show the US economy is already in a
recession, bond king Jeff Gundlach says
September
18, 2024
·
The
Fed should have cut interest rates a lot sooner, according to Jeff Gundlach.
·
The
"Bond King" thinks the economy
is already in recession, as evidenced by rising layoffs.
·
Job
cut announcements climbed 193% over the last month, per a report from
Challenger.
The
Fed is cutting interest rates too late, as mounting job losses show that the US
economy is already in a recession, according to Jeff Gundlach.
The
billionaire "bond
king"
and DoubleLine CEO pointed to the Fed's
anticipated rate move on
Wednesday, with markets expecting central bankers to lower the federal funds
rate by 50 basis points at the conclusion of their policy meeting. That will
mark the first rate cut the Fed has issued in over four years — a shift to
prevent high rates from weighing too heavily on the job market and economic
growth.
But
the economy has already slowed to recessionary levels, Gundlach said in a
conference panel on Tuesday, pointing to concerns surrounding the weakening
job market.
"We
are in a recession already," Gundlach said at the event, per
Bloomberg's report. "I see an
awful lot of layoffs announcement."
Hiring
has slowed steadily over the past year, even as GDP has continued to grow in
recent quarters. Layoff
announcements climbed
193% over the last month, according to a report from the consultancy
Challenger, Gray, & Christmas. Hiring plans for the year have also fallen
to their lowest level on record, down 41% in August compared to last year, the
report added.
Still,
most experts note that the US economy remains on solid footing. GDP
grew 3% last
quarter. Unemployment,
meanwhile, remains near historic lows, with the jobless rate clocking in at
4.2% in August.
Gundlach,
though, said he would give the Fed an "F" grade for its performance
over the past several years. Central bankers hiked interest rates 525
basis-points in 2022 and 2023 to lower inflation, but they should have
responded to inflationary pressures much sooner, he said, which could have
prevented interest rates from being kept too high for too long.
More
China
to ramp up policy steps to revive economy but no 'bazooka' stimulus seen
By Kevin Yao September 19, 20246:53 AM GMT+1
BEIJING,
Sept 19 (Reuters) - Chinese policymakers will likely step up measures to at
least help the economy meet an increasingly challenging growth target for 2024,
analysts and policy advisers say, with a sharper focus on boosting demand to
fight persistent deflationary pressures.
Official
data showed the world's second-largest economy slowed broadly in August,
fuelling expectations for more stimulus. President Xi Jinping recently urged
authorities to strive to meet the country's annual economic goals, signalling
Beijing remains committed to hitting its around 5% GDP growth target.
Policymakers
are navigating a complicated economic landscape, with China's reliance on
infrastructure spending to drive growth exacerbating debt risks. Excessive
domestic investment amid weak demand has also fuelled deflationary pressures,
which have already pushed down prices and forced companies to reduce wages or
fire workers to cut costs.
"We
need to strengthen fiscal policy, which is more effective at addressing
deflation, while adjusting monetary policy further to keep it
accommodative," a policy adviser said on condition of anonymity.
The
Federal Reserve's interest rate cut on
Wednesday, which began the U.S. easing cycle, will create more space for the
People's Bank of China (PBOC) to lower interest rates and banks' reserve
requirement ratio. The PBOC may also slash interest rates on existing mortgages
to help homeowners, analysts said.
China
could additionally step up its spending. Local governments have been quickening
bond issuance to help fund the construction of major projects, alongside
increased debt issuance by the central government to support key strategic
sectors.
While
policymakers may count on a combination of fiscal stimulus and monetary easing
to spur growth, a key meeting of the ruling Communist Party in July reaffirmed
a stronger focus on the supply side. That suggests forceful measures to tackle
weak consumer demand and deepening deflation risks are unlikely in the near
term.
"They
(policymakers) will step up efforts as they are unwilling to accept lower
growth," said Xu Hongcai, deputy director of the economic policy
commission at the state-backed China Association of Policy Science.
"But
any forceful stimulus looks unlikely."
Over
recent years China has been relying on increased spending on infrastructure and
manufacturing to support growth, with the central bank steadily lowering
borrowing costs.
More
China to ramp up policy steps to revive economy but no 'bazooka' stimulus seen | Reuters
Covid-19 Corner
This section will continue until it becomes unneeded.
COVID-19
2024 fall guide: Everything Canadians should know about new Moderna vaccine,
current variants and more
Moderna's
latest Spikevax formula has been given the green light in Canada.
Updated Wed,
September 18, 2024 at 6:45 PM GMT+1
An updated
COVID-19 vaccine is
coming to Canada just in time for fall. On Tuesday, Health Canada announced it
had approved Moderna’s latest COVID vaccine that’s been reformulated to target
prevalent variants like KP.2. The updated formula will be available to
Canadians as part of the fall and winter immunization campaigns.
In
an email to CTV News, Public Health Agency of Canada
spokesperson Anna Maddison said the new vaccines are expected to arrive
"within days."
"Health
Canada anticipates issuing a decision regarding the Novavax and Pfizer COVID-19
vaccines over the next weeks," Maddison said.
Are
COVID cases on the rise in Canada?
The
latest vaccine approval comes as Health Canada reports “most COVID-19
indicators are stable at elevated levels compared to spring.” Although trends
vary across provinces and territories, outbreaks have been “slowly increasing”
since spring. As of Sept. 17, COVID activity levels were reported as “high” for
Ontario and Quebec.
What
COVID strains are expected to dominate this fall?
Currently,
the KP.3 and KP.3.1.1 FLiRT variants, derivatives of KP.1 and KP.2, are the
most prevalent in Canada and the United States. As of Sept. 8,
67.5 per cent of COVID cases in Canada were from the KP.3.1.1 subvariant.
Experts
believe new variants
related to KP.3 will continue to emerge, however there are other variants,
like XEC, spreading in countries like Germany, the United Kingdom and Denmark.
Unlike KP.3, XEC emerged from earlier Omicron variants. In an interview
with Yahoo Life, University of California, San Diego virologist Dr.
Davey Smith said XEC is primed to become the latest subvariant to take over and
"likely the one that will cause our winter wave" of COVID.
How
is the new vaccine formula different from the old one?
Until
now, Canada has only had access to vaccine formulas that were approved in fall
2023 and target the Omicron XBB.1.5. Moderna's latest formulation of their mRNA
vaccine, Spikevax, targets the KP.2 variant.
Will
the new vaccine formulation protect me from emerging COVID strains?
Many
Canadians may be wondering if the new vaccine, which was formulated to protect
against KP.2, will protect them against emerging variants, like KP.3 and the
subvariant KP.3.1.1.
Dr.
Donald Vinh an infectious disease specialist at McGill University tells Yahoo
Canada it’s best to think of KP.2 variant and KP.3 (and future
subvariants like KP.3.1.1.) as cousins since they share certain mutations in
their spike proteins.
Vinh
says the existing vaccines formulated to target KP.2 from Moderna and Pfizer
(which is still under review in Canada) have been successful in against their
targeted strains. According to Vinh, as KP.3 and its variants continue to
circulate, these vaccines “are likely going to have an impact in protecting
against clinically important disease.”
“However,
the variants are constantly in flux,” he says. “We are hearing about newer
variants in other parts of the world that are less related/close to KP.2 or
KP.3, and it will not be a surprise if some of these variants predominate,
perhaps over the next 3-6 months, and for which the current vaccine
formulations may or may not have weakened activity against them.”
More
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.
Silk &
Graphene: Spinning Up the Future of Electronics
By Pacific
Northwest National Laboratory September 18, 2024
Researchers
have developed a method to create a two-dimensional silk protein layer
on graphene, enhancing its potential in microelectronics, particularly for
wearable and implantable health sensors and memory transistors in computing.
This
innovation offers a nontoxic, water-based, and biocompatible system,
potentially revolutionizing silk’s application in luxury materials and
high-tech industries. The research opens pathways for further advancements in
silk-integrated circuits and sustainable electronic solutions.
Revolutionary
Uses of Silk in Microelectronics
After
thousands of years as a highly valuable commodity, silk continues to surprise.
Now it may help usher in a whole new direction for microelectronics and
computing.
While
silk protein has been deployed in designer electronics, its use is currently
limited in part because silk fibers are a messy tangle of spaghetti-like
strands.
Now, a
research team led by scientists at the Department of Energy’s Pacific Northwest
National Laboratory (PNNL) has tamed the tangle. They report today (September
18) in the journal Science Advances that they have achieved a
uniform two-dimensional (2D) layer of silk protein fragments, or “fibroins,” on
graphene, a carbon-based material useful for its excellent electrical
conductivity.
“These
results provide a reproducible method for silk protein self-assembly that is
essential for designing and fabricating silk-based electronics,” said Chenyang
Shi, the study’s lead author. “It’s important to note that this system is
nontoxic and water-based, which is crucial for biocompatibility.”
This
combination of materials—silk-on-graphene—could form a sensitive, tunable
transistor highly desired by the microelectronics industry for wearable and
implantable health sensors. The PNNL team also sees potential for their use as
a key component of memory transistors or “memristors,” in computing neural
networks. Memristors, used in neural networks, allow computers to mimic how the
human brain functions.
More
Silk &
Graphene: Spinning Up the Future of Electronics (scitechdaily.com)
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt
Clocks (usdebtclock.org)
Another
weekend and a wider Middle East war? Hopefully not, but US regional diplomacy
has never looked so impotent. Have a great weekend everyone. Tomorrow, inside
the Titanic.
Why
should we, however, in economics, have to plead ignorance of the sort of facts
on which, in the case of a physical theory, a scientist would certainly be
expected to give precise information?
Friedrich August von Hayek.
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