Wednesday, 5 February 2025

Is DJT The New Sir Francis Drake? Pirate, Gamechanger?

Baltic Dry Index. 753 +15            Brent Crude 76.04

Spot Gold 2859               US 2 Year Yield 4.21 -0.05  

US Federal Debt. 36.439 trillion!

I have made the tough decisions, always with an eye toward the bottom line. Perhaps it's time America was run like a business.

Donald Trump.

In the stock casinos, more business as usual, relief rally. But is it really business as usual? What happens in 30days?

Does President Trump cave on tariffs on Canada and Mexico, or do Canada and Mexico fold like Panama?

No one knows of course, I suspect not even President Trump.

Betting on stocks for the next 30 days is betting on red or black at roulette, but supposing green turns up instead. Look away from that gold price now.

Asia-Pacific markets mostly rise after Wall Street looks past U.S.-China trade spat to rise overnight

Updated Wed, Feb 5 2025 12:54 AM EST

Asia-Pacific markets mostly rose Wednesday after Wall Street rose overnight, shrugging off Trump tariffs and China’s retaliatory measures.

All eyes are on China, which resumed trading after the Lunar New Year holidays and as the Chinese government announced tariffs on U.S. imports in retaliation to duties on its exports.

Morningstar’s Asia equity analyst Kai Wang, says China’s tariffs on the U.S. are “largely symbolic given that only about 12% of total imports from the U.S. would be subject to tariffs.”

“A key takeaway from this development, at least for now, is that fundamentally there is less risk implied than expected before. However, escalation of the trade war remains a risk given Trump’s history of unpredictable behavior. Therefore, the volatility risk remains on the table for the next four years at least,” Wang wrote in a note Tuesday.

Mainland China’s CSI300 Index started the day up, but reversed course to drop 0.53%.

China’s Caixin Services PMI came in at 51.0 in January, compared with December’s 52.2 reading, showing a slowdown in the country’s services activity.

Hong Kong’s Hang Seng index was down 1.34%, reversing from gains in the previous session.

Japan benchmark Nikkei 225 rose 0.13% while the broader Topix index gained 0.24%, in choppy trading.

South Korea’s Kospi rose 1.05% and the small-cap Kosdaq gained 1.61%.

The country’s consumer price index for January rose 0.7% month on month and 2.2% annually — more than Reuters’ 1.97% estimate.

Indian stocks climbed as the Reserve Bank of India holds its first monetary policy meeting under the new central bank governor, with investors expecting a rate cut when the meeting concludes on Friday.

The benchmark Nifty 50 was up 0.11%, while the BSE Sensex index advanced 0.15%.

Over in Australia, the S&P/ASX 200 rose 0.51% to end the day at 8,416.90.

Overnight in the U.S., the three indexes moved higher following the developments around global trade.

Software player Palantir popped about 24% on fourth-quarter results. AI major Nvidia advancing 1.7% during the session.

The tech-heavy index Nasdaq Composite jumped 1.35% to 19,654.02, while the S&P 500 rose 0.72% to 6,037.88. The Dow Jones Industrial Average climbed 134.13 points, or 0.3%, to 44,556.04.

Asia Markets: Asia markets trade mixed

European markets set to open lower ahead of more earnings reports

Updated Wed, Feb 5 2025 12:36 AM EST

European markets are expected to open in negative territory on Wednesday, with investors looking ahead to more earnings from a number of key companies.

The U.K.’s FTSE 100 index is expected to open 18 points lower at 8,555, Germany’s DAX down 67 points at 21,439, France’s CAC down 23 points at 7,888 and Italy’s FTSE MIB 91 points lower at 36,707, according to data from IG.

Earnings are set to come from HandelsbankenTotalEnergiesAkzo NobelCredit AgricoleNovo NordiskGSKVestas Wind and Banco Santander, among others. On the data front, the latest purchasing managers’ index data from the euro zone will be confirmed on Wednesday.

Regional bourses were largely flat on Tuesday as investors continued to monitor developments in U.S. trade policy under President Donald Trump, and after the Chinese government announced tariffs on U.S. imports in retaliation against Trump’s new levies on Chinese goods.

Asia-Pacific markets were mixed overnight, with all eyes are on China after it resumed trading after the Lunar New Year holidays. Stateside, S&P 500 futures fell Tuesday night after Google-parent Alphabet posted disappointing revenue, following a positive session for the major averages.

European markets live updates: stocks, news, data and earnings

In other news.

Trump Says U.S. Will Take Over Gaza

Proposal stuns Middle East experts and Trump allies, leaving many questions unanswered

Updated Feb. 4, 2025 9:56 pm ET

WASHINGTON—President Trump called for the U.S. to take long-term control of Gaza and for nearly two million Palestinian residents to permanently leave for neighboring countries, a break with decades of U.S. policy that left the idea of a Palestinian state in tatters.

“The U.S. will take over the Gaza Strip,” Trump said during a press conference alongside Israeli Prime Minister Benjamin Netanyahu at the White House. “I do see a long-term ownership position, and I see it bringing great stability to that part of the Middle East, and maybe the entire Middle East.”

The proposal, if implemented, would deeply involve the U.S. in a development project that Trump officials said earlier in the day could take 10 to 15 years. He left unaddressed how the U.S. would persuade Palestinians to voluntarily surrender their land and whether Israel would ultimately exercise sovereignty in the territory. 

Trump didn’t rule out sending U.S. forces to hold Gaza, a deployment that could launch the kind of long-term American military occupation in the Middle East that Trump has long decried.

More

Trump Says U.S. Will Take Over Gaza - WSJ

New Chinese AI chatbot is sending chills through Silicon Valley

4 February 2025

The launch of DeepSeek marks the start of a worrying time that could see humans lose control to artificial intelligence sooner than you might think, experts have warned.

It took the Chinese startup just two months to build a coherent AI model that rivals ChatGPT - a momentous task that took cash-flush Silicon Valley mega-corporations as long as seven years to complete.

DeepSeek, an AI chatbot developed and owned by a Chinese hedge fund, has become the most downloaded free app on major app stores and is being referred to as 'the ChatGPT killer' across social media.

Its release on January 20 also managed to get investors to sour on American chipmaker Nvidia, Wall Street's darling all last year because of its triple-digit gains. 

More than a week after Nvidia's initial 17 percent decline on January 27, shares have still not recovered, wiping out more than $589 billion in value.

DeepSeek claimed to use far fewer Nvidia computer chips to get its AI product up and running. This led many to think that there'll be a future where there won't be a need for as many costly, electricity-hungry GPUs to win the artificial intelligence race.

Max Tegmark, a physicist at MIT who's been studying AI for about eight years, warned that DeepSeek's abrupt dominance proves that it's much easier to build artificial reasoning models than people thought.

This also means the world might now have to worry about 'the loss of control' over AI much sooner than previously expected, Tegmark said.

The thing all AI companies have in common - including DeepSeek and OpenAI, the maker of ChatGPT - is that their ultimate ambition is to build artificial general intelligence, or AGI.

AGI will be smarter than humans and will be able to do most, if not all work better and faster than we can currently do it, according to Tegmark.

DeepSeek's 39-year-old founder Liang Wenfeng said in an interview in July: 'Our goal is still to go for AGI.'

Tegmark clarified that no one has created it yet, but he speculated that technology will advance enough that building an AGI model will be possible 'during the Trump presidency'.

President Donald Trump recently touted a $100 billion investment into AI infrastructure that will be housed in Texas. OpenAI, Oracle and Softbank are involved in the partnership, and Trump said the project could end up costing up to $500 billion.

'What we want to do is we want to keep it in this country,' Trump said. 'China is a competitor, others are competitors.'

The assumption held by most American politicians that either the US or China will win a Cold War-style race to control AI is entirely wrong, Tegmark said.

Tegmark likened AGI to the magical ring in the Lord of the Rings series. In his estimation, major governments chasing AGI are somewhat like Gollum, the character who gets the ring and is able to extend his lifespan by centuries.

----'The idea is that the ring is going to give you this great power, but in fact, the ring gets power over you. This is exactly what's happening in the world now,' Tegmark said.

'A lot of the politicians are taking it for granted that if they just get AGI first, they're going to control it, and they're going to somehow win over the other superpowers,' he said.

'[Politicians] don't even understand it particularly,' Tegmark said, recalling his private conversations with US lawmakers about AI. 'They don't even know the first thing about the technology, it's just sort of going on vibes.'

Miquel Noguer Alonso, the founder of the Artificial Intelligence Finance Institute, an organization educates professional investors on how to apply AI to their trades, said the level of AI we have now is still 'human augmented.' 

This means it is still independent of us and relies on human input to do much of anything.

More

New Chinese AI chatbot is sending chills through Silicon Valley

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.

A global recession is almost certainly coming and the Fed is to blame, according to the UN

Updated Mon 3 February 2025 at 3:17 pm GMT

Hi, Peter Vanham here, writing on a plane from Geneva to New York, filling for Alan.

We’re already in a global slowdown, and if no immediate policy actions are taken to curb speculative behavior and markup prices in energy, food, and other concentrated global industries, we’ll be in a full-fledged recession by the end of the year, induced in part by excessive rate rises.

Don’t take my word for it: this is the analysis of Rebeca Grynspan, the secretary-general of the United Nations Commission on Trade and Development (UNCTAD), a UN agency that tracks global growth and trade in developing countries, whom I sat down with in Geneva. At times, it felt like a “J’accuse” of American capitalism, though Grynspan oft repeated her agency is pro-capitalist, promoting trade.

First the news: according to the latest UNCTAD Trade and Development report, global growth is expected to slow down to 2.5% this year, and 2.3% by 2023.[?2026? 2033?] That means a global recession is almost a fact, as 2.5% is the threshold for that. (A top rate of 2.5% globally means many regions are in a recession, while other regions experience de facto negative growth when adjusted for population.)

Who’s to blame and how can worse be averted? The Fed with its sole focus on domestic price inflation certainly doesn’t make a good impression, according to Grynspan. By rapidly and incessantly raising interest rates, it and other central banks engage in an “imprudent gamble,” as they are a “harsh and blunt” tool, and “there is no way you can control inflation without getting into a recession.”

One consequence: some 90 developing countries saw their currency weaken against the dollar this year, making it harder for them to buy any goods priced in dollar, or pay back dollar-denominated debt, and leading almost all into an economic downturn.

What makes matters worse, Grynspan says, is that aggregate demand isn’t the main cause for price rises: “It is markups and speculation. You have to look at the supply side.”

To back up her analysis, Grynspan and her colleague Anastasia Nesvetailova, UNCTAD’s macro-economist, share two observations. First, in the U.S., they see corporate profits now driving 50% of price growth, compared to 10% previously. It suggests increased market concentration and pricing power.

Second, they say, speculators are causing further turmoil in commodity and energy markets. In places like the Chicago Mercantile Exchange, future markets are usually controlled by price hedgers, in a ratio of 70/30 to speculators. Now, according to UNCTAD, that ratio has reversed.

More

A global recession is almost certainly coming and the Fed is to blame, according to the UN

Covid-19 Corner

This section will continue until it becomes unneeded.

'Greedy' Birmingham accountant used Covid funding as 'piggy bank' to claim £270k

3 February 2025

A 'greedy' account who fraudulently claimed nearly £270,000-worth of Covid-19 support funding has been jailed. Zeeshan Ashraf received bounce back loans and 'Eat Out to Help Out' payments he was not entitled to and swindled the Job Retention Scheme during the pandemic.

The 44-year-old, from Glaisdale Road, Hall Green 'abused his position of trust' at AZ Certified Accountants as he used emergency national funding as his own 'personal piggy bank'. Ashraf admitted five counts of fraud committed between April 2020 and April 2021.

He was sentenced to three years and eight months at Birmingham Crown Court today, Monday, February 3. Judge Heidi Kubik KC told him: "At a time of national stress and anxiety during the pandemic, out of pure greed you abused your position of trust as an accountant and sought to benefit dishonestly by falseley claiming benefits to which you were not entitled."

Ashraf inflated the turnover of his business to illegally claim three bounce loans to the maximum amount of £50,000 each from banks Barclays, Starling and NatWest. He purported the money was to help his business but in reality it was to spend on personal expenses, amid debt he had got into.

Ashraf also failed to tell the latter two banks he had already made an application, when only one was permitted. The court was told he illegally obtained £91,174 from the Covid Job Retention Scheme through making multiple applications to HM Revenue and Customers (HMRC) on behalf of clients which were false or unauthorised.

Additionally, Ashraf defrauded the 'Eat Out to Help Out' scheme out of £26,928 by submitting applications on behalf of hospitality companies that did not exist or did not operate in the restaurant trade. In total he illegally claimed £268,102.07 and attempted to further apply for another £50,000 worth of funding.

Prosecutor Catherine Ravenscroft said the money was paid into Ashraf's bank account and 'simply dissipated' as he used it on 'personal spending'. Exdol Mitchell, defending, said his client was the main carer for his father and imprisonment would greatly impact his wife and their two children.

He submitted in 'ordinary circumstances' Ashraf would meet the criteria for a suspended sentence because he had no previous convictions and 'could be rehabilitated'. However the barrister added he was also 'realistic' the likely outcome would be immediate jail-time. He told the court Ashraf was in debt at the time of the offences and confirmed he had repaid around £33,000 of the money so far.

Mark Robinson, operational lead in HMRC’s Fraud Investigation Service, said: "As an accountant Zeeshan Ashraf held a position of trust and responsibility. He breached that trust with his clients to submit a string of fraudulent claims to steal thousands of pounds of taxpayers’ money at the height of a national crisis.

"We remain absolutely committed to bringing people like Ashraf to justice and will continue to tackle error and fraud in the covid support schemes, as the public would rightly expect."

More

'Greedy' Birmingham accountant used Covid funding as 'piggy bank' to claim £270k

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.

Moss Landing Battery Fire Leads to Health Fears, Evidence of Contamination and Concerns About Overreaction

Residents describe experiences of sore throats and other symptoms. The energy storage industry insists that this incident is an extreme outlier.

By Dan GearinoKiley Price  February 1, 2025

Two weeks after a devastating fire in Moss Landing, California, at one of the world’s largest battery energy storage plants, some residents are organizing to try to get answers about medical symptoms they attribute to the fire. 

Researchers have found an increase in heavy metals in nearby soils, and state utility regulators have issued a proposed rule aimed at improving safety at battery plants and are in the early stages of determining what caused the fire.

Groups with ties to energy industries are acknowledging the scale of this incident, but also urging the public to not to overreact. They cite data showing that fires at battery facilities are rare and have become less common in recent years, despite growth in the size and number of plants.

The situation is developing on many fronts as officials deal with concerns about pollution at the same time that they try to figure out what the lithium-ion battery fire may mean in the context of California’s—and the country’s—increasing use of energy storage plants.

Lingering Symptoms Worry Residents 

Angie Roeder lives eight miles from the Moss Landing Energy Storage Facility on a five-acre farm with her husband and son, and saw the Jan. 16 fire from her back deck. Smoke filled the sky; soon, she could smell and taste it.

Since the fire, she has had headaches, shortness of breath and a metallic taste in her mouth, and has been in touch with neighbors who have these symptoms along with others such as sore throats and rashes. They started a Facebook page to share their experiences and to urge officials to investigate whether harmful particles from smoke may be affecting people’s health. The group has about 3,100 members.

“We’re trying to encourage everyone to go see a doctor, get it documented and, you know, have the doctor submit the report to the county health department,” she said.

More

Moss Landing Battery Fire Leads to Health Fears, Evidence of Contamination and Concerns About Overreaction - Inside Climate News

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

World Debt Clocks (usdebtclock.org)

I've taken advantage of the laws. And frankly, so has everybody else in my position.

Donald Trump.

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