Thursday, 27 February 2025

Trump’s Great Uncertainty. Bad Times Next?

Baltic Dry Index. 1112 +73        Brent Crude 72.76

Spot Gold 2895               US 2 Year Yield 4.05 -0.02    

US Federal Debt. 36.531 trillion!

So what do we do? Anything. Something. So long as we just don't sit there. If we screw it up, start over. Try something else. If we wait until we've satisfied all the uncertainties, it may be too late.

Lee Iacocca.

In the stock casinos, the pause before the Great Storm?

Asia markets trade mixed as key Wall Street benchmarks rise amid fresh Trump tariff threats

Updated Thu, Feb 27 2025 12:21 AM EST

Asia-Pacific markets were mixed Thursday, after key Wall Street indexes rose amid fresh tariff threats from U.S. President Donald Trump.

Australia’s S&P/ASX 200 traded 0.35% higher.

Japan’s Nikkei 225 traded around the flatline while the Topix added 0.4%. South Korea’s Kospi slipped 0.82%, while the small-cap Kosdaq dipped 0.1%.

Shares of Japanese convenience store operator Seven & i Holdings fell over 10% after the proposed acquisition by its founding family failed to secure financing, according to a company filing. This comes after the Yomiuri newspaper reported that Seven & i has abandoned the management buyout plan, which was pegged at over 8 trillion yen ($53.69 billion).

Hong Kong’s Hang Seng Index lost 0.18% while mainland China’s CSI 300 slipped 0.2%.

Trump on Wednesday threatened to impose 25% tariffs on imports from the European Union. This comes on the back of the president’s declaration to go forward with tariffs on Mexico and Canada after a monthlong postponement.

Investors will be keeping an eye on Asian chip stocks after technology darling Nvidia’s fourth-quarter earnings beat Wall Street expectations. The chipmaker also provided strong guidance for the current quarter and indicated its confidence in continuing its historic run of growth fueled by artificial intelligence.

“While markets have begun to react to these developments, deep tariff risks are still being underpriced,” Goldman Sachs wrote in a note released Wednesday.

Kamakshya Trivedi, the investment bank’s head of global FX, rates and EM strategy, said that the scope for U.S. equities to fall further and a stronger move in the dollar still exists if Trump “walks the walk” on broader and bigger tariffs.

Overnight in the U.S., the S&P 500 eked out gains, snapping a four-day run of losses to close at 5,956.06 The Dow Jones Industrial Average dropped 188.04 points, or 0.43%, to end at 43,433.12. The 30-stock average was earlier up as much as 245.34 points, or about 0.6%. Meanwhile, the tech-heavy Nasdaq Composite rose 0.26% and ended at 19,075.26.

Asia markets live: Nvidia, Asia chip stocks, Trump tariffs

S&P 500 futures tick higher after index snaps four-day losing streak: Live updates

Updated Thu, Feb 27 2025 12:48 AM EST

S&P 500 futures ticked higher early Thursday as investors digested Nvidia’s latest results.

Futures tied to the broad market index inched higher. Nasdaq 100 futures added 0.28%. Dow Jones Industrial Average futures added 65 points, or 0.15%.

Nvidia shares were slightly lower even after the chip giant exceeded fourth-quarter estimates on the top and bottom lines. The company issued strong guidance, reflecting continued demand driven by the artificial intelligence race. Salesforce slid 5% on disappointing fourth-quarter revenue and light guidance.

On Wednesday, stocks came off the session’s highs as investors grew concerned about President Donald Trump’s trade policies. At his first cabinet meeting, he said that duties against Canada and Mexico would take effect and that his trade war will include a 25% tariff on goods from the European Union.

The S&P 500 eked out just a 0.01% gain on Wednesday, ending its four-day streak of losses. The 30-stock Dow dropped 188 points, or about 0.4%. The tech-heavy Nasdaq Composite added nearly 0.3%.

“Caution is warranted. The remarkable strength of equities in recent months suggests that any downside should be approached with care,” said Fawad Razaqzada, market analyst at Forex. “For the bulls, a corrective move lower wouldn’t be unwelcome, as it could present more attractive entry opportunities in the future. But today, everything else may well play second fiddle to Nvidia’s earnings result.”

Indeed, a flurry of recent economic reports — including a softer-than-expected consumer confidence reading, disappointing retail sales numbers and a weak consumer sentiment reading — have rattled stocks and raised worries about the health of the U.S. economy.

Traders will have an eye on Thursday’s weekly jobless claims, but they’re looking ahead to Friday’s personal consumption expenditures price index — the Federal Reserve’s preferred inflation gauge.

On the quarterly earnings front, Warner Bros. Discovery and Dell Technologies are slated to report Thursday.

Stock market today: Live updates

In other news.

Trump sows confusion on tariffs for Canada and Mexico, floats 25% duty on EU goods

27 February 2025

WASHINGTON (Reuters) - U.S. President Donald Trump on Wednesday raised hopes for another month-long pause on steep new tariffs on imports from Mexico and Canada, saying they could take effect on April 2, and floated a 25% "reciprocal" tariff on European cars and other goods.

A White House official, however, said Trump's previous March 4 deadline for the 25% tariffs on Mexican and Canadian goods remained in effect "as of this moment," pending his review of Mexican and Canadian actions to secure their borders and halt the flow of migrants and the opioid fentanyl into the U.S.

Trump sowed confusion during his first cabinet meeting on Wednesday, when he was asked about the timing for the start of the duties for Canada and Mexico and replied that it would be April 2.

"I have to tell you that, you know, on April 2, I was going to do it on April 1," Trump said. "But I'm a little bit superstitious, I made it April 2, the tariffs go on. Not all of them but a lot of them."

Trump's comments prompted jumps in the value of the Canadian dollar and Mexican peso versus the greenback.

Canadian Innovation Minister Francois-Philippe Champagne told reporters that Canada would wait for signed executive orders from Trump before reacting.

"Our mission is still to avoid the tariffs, extend the suspension if we need to," Champagne said. "We are prepared - there will be a targeted, strategic but a firm response" if Trump imposes tariffs.

Mexico's Economy Ministry declined to comment on Trump's remarks, but said Economy Minister Marcelo Ebrard will meet on Thursday with newly confirmed U.S. Trade Representative Jamieson Greer and Commerce Secretary Howard Lutnick on Friday.

Lutnick told the cabinet meeting that the fentanyl-related actions were paused for 30 days but referred to "overall" tariffs on April 2. He did not specify whether the March 4 deadline remained in effect.

"So the big transaction is April 2, but the fentanyl-related things, we're working hard on the border," Lutnick said. "At the end of that 30 days, they have to prove to the president that they've satisfied him in that regard. If they have, he'll give them a pause, or he won't."

EU TARIFF RATE

Trump has targeted early April for imposing reciprocal tariffs matching import duty rates of other countries and offseting their other restrictions. His trade advisers consider European countries' value added taxes to be akin to a tariff.

Trump, asked whether he has decided on a tariff rate for goods from the European Union, replied: "We have made a decision, and we'll be announcing it very soon, and it'll be 25%, generally speaking, and that'll be on cars, and all of the things."

He said the EU is a "different case" from Canada and takes advantage of the U.S. in different ways.

More

Trump sows confusion on tariffs for Canada and Mexico, floats 25% duty on EU goods

Nvidia warns of growing competition from China’s Huawei, despite U.S. sanctions

Published Thu, Feb 27 2025 12:18 AM EST

BEIJING — Chip giant Nvidia has flagged heightened competition from Huawei, despite U.S. restrictions on the Chinese telecommunications company.

In an annual filing Wednesday, Nvidia listed Huawei among its current competitors, including it in the list for a second straight year. The company, blacklisted by the U.S. for national security reasons, did not feature among Nvidia’s competitors for at least three prior years.

Nvidia listed Huawei among its competitors in four of five categories, including chips, cloud services, computing processing and networking products.

“There’s a fair amount of competition in China,” Nvidia CEO Jensen Huang told CNBC’s Jon Fortt Wednesday.

“Huawei, other companies, are ... quite vigorous and very, very competitive,” Huang said.

Since 2019, the U.S. has restricted Huawei’s ability to access technology from American suppliers, from advanced 5G chips to Google’s Android operating system.

Huawei’s revenue exceeded 860 billion yuan ($118.27 billion) in 2024, state media reported, a 22% jump in revenue from 2023, and the fastest growth since a 32% increase in 2016, according to CNBC calculations of publicly released figures. Huawei typically publishes its annual reports in March.

The company’s revenue barely grew in 2020, and plunged by nearly 29% in 2021. Its consumer segment was hit hard, and even as revenue rose 17% year on year to 251.5 billion yuan in 2023, it was just over half of what the unit generated at its peak in 2020.

The telecommunications company started to make a comeback in the smartphone market in 2023 with the release of its Mate 60 Pro in China. Reviews indicated the device offers download speeds associated with 5G — thanks to an advanced semiconductor chip.

Just over a year later, Huawei launched the Mate 70 smartphone series that uses the company’s first fully self-developed operating system, HarmonyOS NEXT.

Nvidia warns of competition from China's Huawei, despite U.S. sanctions

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.

The Federal Reserve’s favorite recession indicator is flashing a danger sign again

Published Wed, Feb 26 2025 12:44 PM EST Updated Wed, Feb 26 2025 1:57 PM EST

An ominous measure that the Federal Reserve considers a near surefire recession signal again has reared its head in the bond market.

The 10-year Treasury yield passed below that of the 3-month note in trading Wednesday. In market lingo, that’s known as an “inverted yield curve,” and it’s had a sterling prediction record over a 12- to 18-month timeframe for downturns going back decades.

In fact, the New York Fed considers it such a reliable indicator that it offers monthly updates on the relationship along with percentage odds on a recession occurring over the next 12 months.

At the end of January, when the 10-year yield was about 0.31 percentage point clear of the 3-month, the probability was just 23%. However, that is almost certain to change as the relationship has shifted dramatically in February. The reason the move is considered a recession indicator is the expectation that the Fed will cut short-term rates in response to an economic retreat in the future.

“This is what one would expect if investors are adopting a much more risk-averse attitude set of behavior due to a growth scare, which one periodically sees late in business cycles,” said Joseph Brusuelas, chief economist at RSM. “It’s not clear yet whether it’s more noise or it’s a signal that we’re going to see a more pronounced slowdown in economic activity.”

Though markets more closely follow the relationship between the 10- and 2-year notes, the Fed prefers measuring against the 3-month as it is more sensitive to movements in the central bank’s federal funds rate. The 10-year/2-year spread has held modestly positive, though it also has flattened considerably in recent weeks.

More

Federal Reserve's favorite recession indicator is flashing danger again

World economic growth hinges on impact of US tariffs, Bank policymaker says

26 February 2025

Future growth in the world economy hinges on how US tariffs affect global trade, although the impact on UK inflation could be less than feared, a Bank of England interest rate-setter has said.

Economist Swati Dhingra, who is a member of the Bank’s Monetary Policy Committee, said the UK was sensitive to changing import prices.

Speaking at the 2025 Dow Lecture for the National Institute of Economic and Social Research (NIESR), she said: “After a sharp recovery from the pandemic, the world economy has stagnated and its future growth will depend on how global trade is affected by the significant shift in US trade policy.”

The “direct price-increasing effects from US tariffs to UK prices” could be “less than feared” as the main imports, including refined oil, are unlikely to experience cost increases on account of tariffs, Ms Dhingra said.

The impact could instead be felt in how the countries that are subject to higher tariffs choose to pass on additional costs to the UK market, she said.

“The broader indirect effects through global markets and trade diversion are more likely to dominate and to reduce prices in the UK,” according to the economist.

“Tariffs are likely to create one-off adjustments in prices, rather than inflationary persistence.

“On the overall impact on inflation in the UK, the direct effect of US import costs and dollar strengthening are likely to be offset by reduced global price pressures.”

US President Donald Trump has raised the threat of increasing tariffs on goods entering the nation, including plans to hike tax on steel imports.

Tariffs could increase domestic production in the US over the long term, but lead to higher import prices and impact other countries that rely on it for imports and exports.

World economic growth hinges on impact of US tariffs, Bank policymaker says

Economists are starting to worry about a serious Trump recession

Tariffs on America’s neighbours and assault on federal government will hit US economy

25 February 2025 4:00pm GMT

Donald Trump’s assault on the US federal government and the world’s interlinked manufacturing system have together reached an economic tipping point.

“It seems almost unavoidable that we are headed for a deep, deep recession,” said Jesse Rothstein, Berkeley professor and former chief economist at the US labour department.

Once the pace of job losses crosses a critical line, the multiplier effects can snowball suddenly.

Prof Rothstein said monthly non-farm payrolls – the barometer of US economic health watched closely by markets – could turn viciously negative by late spring, contracting at rates surpassed only during the worst months of Covid and the Lehman crisis in 2008.

“I think we’re going to see historically large drops. Losses of 400,000 a month are not implausible because people are getting nervous out there.

“It is not just the federal employees being fired: it’s all the other people worried they could be next, so they are cutting back too,” he told The Telegraph.

Torsten Slok, of Apollo Global, said layoffs could approach 1m after factoring in the likely chain reaction through contractors. “We are starting to worry about the downside risks to the economy and markets,” he said.

Mr Slok said it is a mystery as to why credit spreads and equities are still so well-behaved when the US Economic Policy Uncertainty Index was now higher than at any time during the great recession.

Prof Rothstein said the damage would not show up immediately due to lag effects. The ugly months will be in April and May, but by then secondary shocks will have spread far and wide.

“There are all kinds of spillovers. Contracts for external contractors are being cut. Nobody knows how much imports are going to cost next month, or if we are even going to have accurate weather forecasts any more.

“How could you hire in these conditions? This is going to be very, very bad,” he said.

Markets are implicitly betting that Trump’s trade wars are just bluster, but he restated on Monday night that his 25pc tariffs against Mexico and Canada would go ahead next week, which would instantly snarl up the North American auto industry.

More

Economists are starting to worry about a serious Trump recession

Covid-19 Corner

This section will continue until it becomes unneeded.

Strong link between public’s behaviour to mitigate Covid-19 and daily case figures, report shows

25 February 2025

THERE WAS A “strong” link during the pandemic between efforts the Irish public undertook to mitigate the risk of Covid-19 infection and the number of new daily cases that were reported.

That’s according to a new report from the ESRI on the lessons that can be learned from the Covid pandemic on “promoting a nationwide collective response” from future pandemics or emergencies.

The report analysed data from the Social Activity Measure (SAM), which was collected fortnightly over an 18-month period from January 2021 to June 2022.

SAM adapted the Day Reconstruction Method, which asks people to record their behaviour from the previous day in detail, as well as their perceptions of the pandemic and attitudes towards it.

The study was done online and anonymously, to a nationally representative sample of 1,000 people every two weeks.

It found that behaviours to mitigate the risk of Covid infection were “strongly associated with the contemporaneous number of new daily cases of COVID-19”.

The report stated that the link to daily case numbers was stronger than with other indicators, such as hospitalisations and deaths, even after the vaccine became available.

The ESRI said that this “close relationship between behaviour and the COVID-19 case numbers confirms that putting accurate, numeric indications of risk into the public domain can strongly influence the public response”.

“In future emergencies, where possible, the publication of a number linked to the scale of a threat is likely to be similarly impactful,” said the ESRI.

Meanwhile, the ESRI noted that cooperation with mitigation measures during the pandemic was largely voluntary, “with only a limited role for legal deterrents”.

However, it added that “voluntary collective action on this scale needs to be coordinated by the policy and communication that surrounds it”.

The ESRI further stated that in emergencies, rules need to be “simple and straightforward” and that they should be “consistently applied and communicated”.

“Straightforward, explicit rules are also easier to self-police and to observe in others, making cooperation more likely”, said the ESRI.

While the ESRI said there was fatigue with sticking to the public health guidelines as the pandemic wore on, it noted that more important was whether the restrictions were viewed as “coherent rather than contradictory”.

It added that “perceptions of how much others were complying with restrictions mattered too”.

The degree to which others were perceived to be complying with the rules influenced behaviour to a greater extent than the “likelihood of being caught and fined were they to break restrictions”.

“Voluntary willingness to do the right thing mattered more than deterrence,” said the ESRI.

Strong link between public’s behaviour to mitigate Covid-19 and daily case figures, report shows

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.

Durable and Transparent: Researchers Develop High-Efficiency Bifacial Perovskite Solar Cells

By International Society for Optics and Photonics February 25, 2025

Bifacial perovskite solar cells with a transparent electrode offer high efficiency, durability, and infrared transparency, paving the way for major advancements in solar energy applications.

Bifacial perovskite solar cells, which capture sunlight from both sides, have shown great potential for enhancing solar energy efficiency. Researchers at the Indian Institute of Technology (IIT) have recently advanced their development by introducing a novel NiO/Ag/NiO (NAN) transparent electrode. This innovation improves efficiency, durability, and infrared transparency, offering promising applications in solar energy technology.

As detailed in the Journal of Photonics for Energy, a research team from IIT Dharwad designed and fabricated bifacial solar cells with high infrared transparency. They achieved this by integrating a hybrid top transparent electrode (TE) composed of a three-layer NiO/Ag/NiO structure. Using a low-energy physical vapor deposition technique, they developed an electrode with exceptionally low electrical resistance and high visible light transmittance, significantly enhancing the performance of these solar cells.

High Efficiency and Bifacial Performance

When integrated into the solar cell configuration, the NAN-TE demonstrated impressive power conversion efficiencies (PCE) of 9.05 and 6.54 percent when illuminated from different sides. A high bifaciality factor of 72 percent indicates the cell’s ability to effectively capture light from both directions.

Moreover, these bifacial solar cells exhibited remarkable durability, maintaining 80 percent of their initial efficiency for over 1000 hours without any protective encapsulation. They also allowed significant light transmission in the near-infrared region, making them suitable for thermal windows and optoelectronic applications.

The thin profile of the NAN-TE—less than 40 nm—further enhances its potential for integration into building materials and tandem solar cell applications. Senior author Dhriti Sundar Ghosh, associate professor of physics at IIT Dharwad, remarks, “This work may provide a design strategy for TEs that can be included in bifacial perovskite solar cells for use in tandem devices, agrivoltaics, and automotive technologies, among other potential uses.” This breakthrough highlights the immense potential of bifacial perovskite solar cells in advancing solar energy technology.

Reference: “Hybrid top transparent electrode for infrared-transparent bifacial perovskite solar cells” by Sonia Rani, Arun Kumar, Abhishek K. Chauhan and Dhriti Sundar Ghosh, 18 February 2025, Journal of Photonics for Energy.
DOI: 10.1117/1.JPE.15.015501

Durable and Transparent: Researchers Develop High-Efficiency Bifacial Perovskite Solar Cells

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

World Debt Clocks (usdebtclock.org)

I think it's much more interesting to live not knowing, than to have answers which might be wrong.

Richard P. Feynman. 

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