Baltic Dry Index. 1809 +19 Brent Crude 79.04
Spot
Gold 2657 U S 2 Year Yield 3.95 -0.03
It is a sobering fact that the prominence of central banks in
this century has coincided with a general tendency towards more inflation, not
less. [I]f the overriding objective is price stability, we did better with the
nineteenth-century gold standard and passive central banks, with currency
boards, or even with 'free banking.' The truly unique power of a central bank,
after all, is the power to create money, and ultimately the power to create is
the power to destroy.
Paul Volcker.
In
the US stock casinos, who knew that hurricanes, strikes, rising debt and debt defaults,
plus rising unemployment were so bullish for stocks?
Dow
jumps 400 points to a record on Friday, S&P 500 closes above 5,800 for the
first time: Live updates
Updated
Fri, Oct 11 20245:19 PM EDT
The S&P 500 and Dow Jones Industrial Average powered
to new highs on Friday and capped off a winning week as banking behemoths
ushered in a promising start to the third-quarter earnings season.
The
broad index gained 0.61% to end at 5,815.03, while the Dow rallied 409.74
points, or 0.97%, to finish at 42,863.86. Both averages hit fresh all-time
highs and closed at records. The Nasdaq Composite added 0.33%
to finish at 18,342.94 and less than 2% below its all-time high.
“What
we’re seeing — and I think you’re seeing it hit pretty hard today, in a good
way — is a broadening of the market,” said Craig Sterling, head of U.S. equity
research at Amundi US.
The
major averages also registered a fifth straight week of gains. The S&P 500
and Nasdaq jumped 1.1% each, while the Dow toted a 1.2% gain.
A
strong start to the third-quarter earnings season provided a lift to
stocks. JPMorgan Chase rose
4.4% after topping
profit and revenue expectations, while Wells Fargo popped 5.6%
on stronger-than-expected
profits. Investors overlooked disappointing revenue and an 11% decline in
net interest income.
“Net
interest income used to be the bellwether of whether [a] bank is doing well or
not,” said Kim Forrest, chief investment officer at Bokeh Capital Partners.
“Investors have comprehended that they’ll make money in good times and bad.”
Wall
Street tends to view the banking sector as a barometer for the health of
economy, setting the tone for the remainder of the earnings season. However,
Forrest notes they lack the visibility into forward guidance that often affects
the postearnings stock moves.
Stocks
also benefited from data that alleviated fears that inflation was not cooling
off quickly enough. That included a cooler-than-expected September producer
price index reading after the consumer
price index increased slightly more than expected. The findings
signaled that the Federal Reserve may in fact attain a soft landing scenario
and reach its 2% goal, which Goldman Sachs economists think upcoming
September inflation data may already show.
“Overall,
these numbers are getting less impactful as inflation moderates,” said David
Russell, global head of market strategy at TradeStation. “The Fed could still
be on track for 25 basis points at the next two meetings.”
Fed
funds futures trading suggests a nearly 90% likelihood that the Federal Reserve
will dial back interest rates by a quarter point in November, according to
the CME FedWatch Tool. Central bank policymakers will keep a
close eye on additional data, which will shape their course on rates.
Elsewhere, Tesla shares tanked 8.8% on
the back of an underwhelming robotaxi event.
Data
can be ‘heavily influenced’ by storms and strikes, Deutsche Bank global
economics head says
Recent storms and
the port
strikes can bleed into the economic data releases that investors and
Federal Reserve officials closely monitor, according to Jim Reid, head of
global economics and thematic research at Deutsche Bank.
“We
are in for a period of data heavily influenced by recent storms and strikes,”
he said. “So this will likely make it a complicated few weeks for markets and
the Fed.”
Additionally,
he noted that the narrative has “changed a bit” after last week’s blockbuster
jobs report and Thursday’s consumer
price index reading.
“The
view I’ve felt most certain of was that the market was massively overpricing
the perfect scenario of smooth enough data that the Fed would be able to
serenely cut rates back below 3% without a recession,” he said. “If we don’t
get a recession, it’s hard to see how rates can be cut anywhere near as
aggressively as this.”
Stock
market news for October 11, 2024 (cnbc.com)
In
other news, Boeing’s firing not hiring. China talks about stimulating the
economy by increasing debt. Underwhelming so far.
Boeing
to cut 17,000 jobs as losses deepen during factory strike
Published
Fri, Oct 11 2024 4:32 PM EDT
Boeing will cut 10% of its
workforce, or about 17,000 people, as the company’s losses mount and a machinist
strike that has idled its aircraft factories enters its fifth week. It
will also push back the long-delayed launch of its new wide-body airplane.
The
manufacturer will not deliver its still-uncertified
777X wide-body plane until 2026, putting it some six years behind
schedule. The company in August paused flight tests of the aircraft when it
discovered structural
damage in one of them. It will stop making commercial 767 freighters
in 2027 after it fulfills remaining orders, CEO Kelly
Ortberg said in a staff memo Friday afternoon.
“Our
business is in a difficult position, and it is hard to overstate the challenges
we face together,” Ortberg said. “Beyond navigating our current environment,
restoring our company requires tough decisions and we will have to make
structural changes to ensure we can stay competitive and deliver for our
customers over the long term.”
Boeing
expects to report a loss of $9.97 a share in the third quarter, the company
said in a surprise release Friday. It expects to report a pretax charge of $3
billion in the commercial airplane unit and $2 billion for its defense
business.
In
preliminary financial results, Boeing said it expects to have an operating
cash outflow of $1.3 billion for the third quarter.
The
job and cost cuts are the most dramatic moves to date from Ortberg, who is just
over two months into his tenure in the top job, tasked with returning Boeing to
stability after safety and manufacturing crises, including a near-catastrophic
midair door-plug blow out earlier this year.
The
machinist strike is yet another challenge for Ortberg. Credit ratings agencies
have warned the company is at risk of losing its investment-grade rating, and
Boeing has been burning through cash in what company leaders hoped would be a
turnaround year.
S&P
Global Ratings said earlier this week that Boeing is losing more than $1
billion a month from the strike of more than 30,000 machinists, which began
Sept. 13 after machinists overwhelmingly voted
down a tentative agreement the company reached with the union.
Tensions have been rising between the manufacturer and the International
Association of Machinists and Aerospace Workers, and Boeing
withdrew a newer contract offer earlier this week.
On
Thursday, Boeing said it filed an unfair labor practice charge with the
National Labor Relations Board that accused the International Association of
Machinists and Aerospace Workers of negotiating in bad faith and
misrepresenting the plane makers’ proposals. The union had blasted Boeing for a
sweetened offer that it argued was not negotiated with the union and said
workers would not vote on it.
The
job cuts, which Ortberg said would occur “over the coming months,” would hit
just after Boeing and its hundreds of suppliers have been scrambling to staff
up in the wake of the Covid-19 pandemic, when demand cratered.
Boeing
to cut 17,000 jobs as losses deepen during factory strike (cnbc.com)
Chinese
finance minister hints at increasing the deficit at highly anticipated briefing
Published
Fri, Oct 11 2024 9:57 PM EDT
BEIJING — China’s Minister
of Finance Lan Fo’an told reporters Saturday during a highly anticipated press
briefing that the central government has room to increase debt and the deficit.
He
emphasized that the space for a deficit increase is “rather large,” but noted
such policies are still under discussion, according to CNBC’s translation of
the Chinese.
Economists
have insisted that China needs additional fiscal support, but Beijing has yet
to announce any. In the days leading up to the briefing, many
investors and analysts had hoped that China was gearing up to unveil a
major new stimulus package.
Lan
signaled that the weekend briefing was not the end, that more stimulus is on
the way and that the debt or deficit changes markets have been waiting for
could come in the near future. It remains unclear whether the size of any such
stimulus would meet market expectations, or how much would go directly towards
consumption or real estate.
“These
policies are in the right direction,” Zhiwei Zhang, president and chief
economist at Pinpoint Asset Management, said in a note Saturday. He added that
more details are needed to evaluate the impact of such policies on the macro
outlook, and “this will be the focus of the market in [the] coming months.”
The
finance ministry on Saturday also outlined policy measures focused on
addressing local government debt problems, stabilizing real estate and
supporting employment.
On
real estate, the finance ministry will allow local governments to use special
bonds for land purchases and allow affordable housing subsidies to be used for
existing housing inventory, instead of only new construction, Vice Minister of
Finance Liao Min said at the same press conference, according to CNBC’s
translation of the Chinese.
He
added that authorities were considering plans to reduce real estate-related
taxes. He did not name specific figures and noted supporting real estate
required multiple policies.
More
Chinese
finance minister hints at increasing the deficit at highly antificated briefing
(cnbc.com)
Finally,
in UK amateur government news, His Majesty’s Government blows off a billion.
Without losers, where would the winners be?
Casey Stengel.
P&O
Ferries owner pulls £1bn UK investment after Rayner attack
11
October 2024
P&O
owner DP World has put a £1bn expansion of one of Britain’s biggest container
hubs on hold after ministers attacked the ferry company’s employment practices.
The
Dubai-based business had planned to announce the investment in London Gateway
port at a
summit convened by Prime Minister Sir Keir Starmer next week.
However,
DP World boss Sultan Ahmed bin Sulayem will no longer attend the event after
Transport Secretary Louise Haigh and Deputy Prime Minister Angela Rayner called
P&O “unscrupulous” and “exploitative” earlier this week.
This
relates to the
Government’s bid to strengthen workers’ rights, which includes
vowing to close a “legal loophole” that P&O allegedly exploited when
sacking almost 800 workers in 2022.
A
DP World spokesman confirmed that the planned investment is under review,
Bloomberg News reported.
The
move marks a blow to Sir Keir’s efforts to reposition the UK as a country
that’s open for business, as he aims to catalyse investment at a summit next
week.
A
UK Government official said they believed the matter was still under discussion
with DP World.
Representatives
for Ms Haigh and Ms Rayner did not respond to requests for comment.
P&O Ferries
owner pulls £1bn UK investment after Rayner attack (msn.com)
You look up and down the [UK Government] bench and you have to
say to yourself, 'Can't anybody here play this game?'
With apologies to Casey Stengel.
Global Inflation/Stagflation/Recession
Watch.
Given our Magic Money
Tree central banksters and our spendthrift politicians, inflation/recession now needs an entire
section of its own.
The history of paper money is an account of abuse,
mismanagement, and financial disaster.
Richard Ebeling.
Eurozone on the brink as Germany braces for
crushing double recession blow
Germany,
the European Union's largest economy, is the only G7 economy to decline in
2024.
08:13, Fri, Oct
11, 2024 | UPDATED: 08:25, Fri, Oct 11, 2024
Germany’s flailing economy is facing a second consecutive year of contraction,
Economy Minister Robert Habeck has warned, delivering another crushing blow for
the European Union.
The bloc’s most
populous nation and its economic powerhouse is already in the grip of a recession - and Mr
Halbeck warned there was little prospect of any immediate improvement, with GDP
likely to shrink by 0.2 percent this year, a sharp downturn from earlier
forecasts of 0.3 percent growth.
The expected dip
follows a 0.3 percent contraction in 2023, making Germany - led by
Chancellor Olaf Scholz - the only G7 economy projected to decline in
2024.
The deepening
recession highlights structural challenges that Germany has been battling for
some time, especially dependence on the manufacturing sector and increased
global competition, notably from China.
Economic
forecasts remain bleak for the near future, with German industries fighting to
adapt to these shifts.
Despite the
short-term difficulties, the government is nevertheless cautiously optimistic
about the prospects of a recovery by next year.
Growth is
expected to return at a modest 1.1 percent, slightly above earlier predictions
of one percent, with further increases projected for 2026.
However, such
improvements are heavily dependent on the implementation of structural reforms
and favourable global conditions.
Mr Habeck said:
"Germany’s structural problems are now taking their toll.
"And this
is happening amid major geo-economic challenges. Germany and Europe are caught
in the middle of crises between China and the United States and must learn to
assert themselves.
In response, he
outlined a comprehensive growth package consisting of 49 measures designed to
revitalise the economy.
----However,
despite government efforts, economic challenges persist. The ifo Institute
believes Germany’s economy is now "stuck in crisis," bogged down by
both cyclical and structural issues.
More
‘Dr. Doom’ Nouriel Roubini Warns of Trump
Win Spurring Stagflation Shock
By Natalia Kniazhevich and Alexandra Semenova
October 9, 2024 at 5:40 PM GMT+1
So which
candidate poses a bigger economic threat?
“The combination
of trade, currency, monetary, fiscal, immigration and foreign policy of Trump
poses much higher risks of stagflationary outcomes than if Kamala Harris is
elected,” economist Nouriel Roubini said at a conference this week, according to Bloomberg.
‘Dr. Doom’ Nouriel Roubini Warns of Trump Win Spurring Stagflation Shock - Bloomberg
Covid-19
Corner
This section will
continue until it becomes unneeded.
Is this the way COVID ends? Next-generation nasal
vaccines could be the key to ending pandemic
9 October 2024
When the first COVID-19
vaccines began to roll out in late 2020, they were met with gratitude and hope.
To many people, the remarkable production of vaccines less than a year into the
deadly global pandemic suggested the end would soon be in sight.
But it wasn’t. Four years
later, the global emergency around COVID-19 has ended as have many the public
health measures along with the public’s focus, but the pandemic continues. In
recent weeks, a wave of infections — driven by newer, highly contagious variants
— has spread across Canada, as the early fall surge of COVID-19 continues.
Nearly five years in,
updated COVID-19 vaccines that are a better match for the latest variants have
reduced the most severe acute effects of the virus for many, as well as death
rates and hospitalizations.
It is a remarkable
achievement that saved lives, but it has not been able to stop the virus from
spreading. COVID-19 remains a leading cause of death in Canada. And as health
experts understand more about the long-term damage that can result from the virus,
including Long COVID, heart disease, stroke, and dementia, among others,
COVID-19 has continued to surprise even those who study it closest.
“I think anybody who
tells you COVID-19 isn’t a surprise is not being truthful,” said Matthew
Miller, who is co-director of the Canadian Pandemic Preparedness Hub, Canada
Research Chair in Viral Pandemics and an associate professor in biochemistry at
McMaster University in Hamilton. He is part of the research team that is
developing an inhaled COVID-19 vaccine.
“I have studied pandemic
viruses for a long time. I completely expected we would be in a place by now
where COVID-19 was exhibiting seasonal trends (similar to influenza and other
seasonal viruses that generally occur in the fall and winter). Clearly I was
wrong.
“I don’t think there are
many people who in good faith can say that when this was taking off they
thought we might still be in the place we are now.”
But amid fatigue, there
is a new hope that the end — at least to the pandemic as we know it — might
eventually be in sight.
That hope comes in the
form of mucosal vaccines — next-generation vaccines that are needle-free and
can be sprayed or inhaled. Some see mucosal vaccines as the best hope to end
the COVID-19 pandemic. They are now in development in labs around the world, including
in Canada. The U.S. and other countries are investing heavily in the
development of mucosal vaccines for COVID-19 and beyond.
Much of the excitement
around mucosal vaccines is focused on their potential to stop infections before
they take hold by creating a protective immune barrier in the respiratory tract
and mucosal system, the entry point for infections . Existing
COVID-19 vaccines can prevent severe disease, but not infection.
The team Miller is part
of at McMaster is about to begin Phase 2 trials on a COVID-19 vaccine that is
inhaled using a device similar to an asthma inhaler. It is the most promising
mucosal COVID-19 vaccine under development in Canada and is expected to be
tested in Canadian cities, including Ottawa, next year. The platform used for
the COVID-19 vaccine can be used against other illnesses as well.
More, much more.
Technology Update.
With events happening
fast in the development of solar power and graphene, I’ve added this section.
Potential graphene breakthrough in carbon capture
9 October 2024
Haydale, a
leading innovator in advanced materials and nanotechnology, announces a
potential breakthrough in the rapidly evolving carbon capture technology sector
utilising plasma functionalised graphene as an inherent component.
Haydale has worked with Carbon Capture
LLC (“CCL”), a newly established company based in Florida, to undertake a
feasibility study to build and deliver an initial prototype device. Leveraging
Haydale’s proprietary plasma functionalised graphene, it provides proof of
concept that carbon dioxide can be removed from the atmosphere and stored for
later release in a controlled environment.
Initial indications within this
feasibility study show graphene, when properly functionalised through Haydale’s
proprietary HDPlas® plasma functionalisation process to optimise the surface
chemistry of the nanomaterial, may be capable of adsorbing carbon dioxide.
This feasibility study builds on
Haydale’s expertise in chemical engineering and plasma functionalisation. Both
Haydale and CCL are encouraged by these findings and intend to develop the
application further to ascertain whether it might be commercialised to help
combat climate change. Haydale’s novel nano-material expertise, particularly in
functionalised graphene, has proven integral to the efficiency and
effectiveness of this carbon capture process.
The global carbon capture and storage
market is projected to grow substantially over the next decade, driven by
increasing environmental regulations and the urgent need to address climate
change. If this technology is proven at larger scale, Haydale’s work with CCL
could position it as a key supplier to this burgeoning market, offering
significant new growth opportunities and long-term value creation for
shareholders.
More
Potential graphene breakthrough in carbon capture (msn.com)
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt Clocks (usdebtclock.org)
This
weekend’s music diversion. Beethoven on the keyboard again. Approx. 7 minutes.
Piano
Concerto No. 5 in E-Flat Major, Op. 73 "Emperor": II. Adagio un poco
mosso
Piano Concerto No.
5 in E-Flat Major, Op. 73 "Emperor": II. Adagio un poco mosso -
YouTube
This
weekend’s chess update. Approx. 11 minutes.
The
Greatest Checkmate Ever Given!
The Greatest
Checkmate Ever Given! (youtube.com)
This
weekend’s bonus diversion. A Tesla on autopilot crashes. Approx. 11 seconds
Tesla Owner
Mystified as Car Is Keyed By Man He's 'Never Met' (msn.com)
This
weekend’s final diversion. Inside the elevator, aka lift. Approx.11 minutes.
How
does an Elevator work?
How does an
Elevator work? (youtube.com)
Until government administrators can so identify the interests of
government with those of the people and refrain from defrauding the masses
through the device of currency depreciation for the sake of remaining in
office, the wiser ones will prefer to keep as much of their wealth in the most
stable and marketable forms possible - forms which only the precious metals
provide.
Elgin Groseclose.
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