Baltic Dry Index. 1489 -51 Brent Crude 65.58
Spot
Gold 3038 U S 2 Year Yield 3.68 -0.03
US
Federal Debt. 36.684 trillion.
“Tariffs give us great power to negotiate.”
President
Trump, April 3, 2025.
United States–Mexico–Canada Agreement
---- All
sides came to a formal agreement on 1 October 2018,[12] and
U.S. president Donald Trump proposed USMCA during the G20 Summit the following month, where it was signed by him,
Mexican president Enrique Peña Nieto, and Canadian prime minister Justin Trudeau. A
revised version reflecting additional consultations was signed on December 10,
2019, and ratified by all three countries, with Canada being the last to ratify
on March 13, 2020. Following notification by all three governments that the
provisions were ready for domestic implementation, the agreement came into
effect on 1 July 2020.
---- The USMCA contains a provision for review and adjustment
in 2026.
United
States–Mexico–Canada Agreement - Wikipedia
Revoked by President Trump February 1, 2025. But
who would now trust President Trump to uphold any “negotiated” deal? See the
Canada Tariffs YouTube below.
By some estimates, the
US stock casinos alone have lost some 6 trillion dollars of value in just the
last two days.
Add in Asian and
European stock casino losses of about the same and the reverse wealth effect this
week is fast approaching 13 plus trillion dollars in just the last two days.
Add in commodity market losses and that reverse wealth figure is probably close
to 15 trillion dollars.
While some of this
reverse wealth effect will show up in private equity groups, the real hit is
being taken in insurance companies and pension providers.
Much later it will
show up in reduced capital gains taxes, but short term it’s most likely to show
up in a very worrying decline in consumer spending.
With US 10 percent
minimum import tariffs starting today, it will also very soon show up in rising
US inflation figures.
We open with China
retaliating rather than negotiating.
China
to impose 34% retaliatory tariff on all goods imported from the U.S.
Published
Fri, Apr 4 2025 6:22 AM EDT
China’s finance ministry on Friday said it will
impose a 34% tariff on all goods imported from the U.S. starting on
April 10, following duties imposed by U.S. President Donald Trump’s
administration earlier this week.
“China urges the United States to immediately cancel
its unilateral tariff measures and resolve trade differences through
consultation in an equal, respectful and mutually beneficial manner,” the ministry said,
according to a Google translation.
It further criticized Washington’s decision to
impose 34% of additional reciprocal levies on China — bringing total U.S.
tariffs against the country to 54% — as “inconsistent with international trade
rules” and “seriously” undermining Chinese interests, as well as endangering
“global economic development and the stability of the production and supply
chain,” according to a Google-translated report from
Chinese state news outlet Xinhua.
Separately, China also added 11 U.S. firms to the “unreliable entities list” that the
Beijing administration says have violated market rules or contractual
commitments. China’s ministry of commerce also added 16 U.S. entities to its export control list and said it would implement export controls on seven types of rare-earth related items, including samarium,
gadolinium and terbium.
CNBC has reached out to the White House for comment.
More
China to impose 34% retaliatory tariff on all goods imported from the
U.S.
Dow
drops 2,200 points Friday, S&P 500 loses 10% in 2 days as Trump's tariff
rout deepens: Live updates
Updated
Fri, Apr 4 2025 5:14 PM EDT
The
stock market was pounded for a second day Friday after China retaliated
with new
tariffs on U.S. goods, sparking fears President Donald Trump has
ignited a global trade war that will lead to a recession.
Here’s
a tally of the stock market damage:
- The Dow Jones Industrial Average dropped
2,231.07 points, or 5.5%, to 38,314.86 on Friday, the biggest decline
since June 2020 during the Covid-19 pandemic. This follows a 1,679-point
decline on Thursday and marks the first time ever that it has shed more
than 1,500 points on back-to-back days.
- The S&P 500 nosedived
5.97% to 5,074.08, the biggest decline since March 2020. The benchmark
shed 4.84% on Thursday and is now off more than 17% off its recent high.
- The Nasdaq Composite, home to
many tech companies that sell to China and manufacture there as well,
dropped 5.8%, to 15,587.79. This follows a nearly 6% drop on Thursday and
takes the index down by 22% from its December record, a bear market in
Wall Street terminology.
- The selling
was broad with only 14 members of the S&P 500 higher on the day. Major
market indexes closed at their lows of the session.
China’s
commerce ministry said Friday the country will
impose a 34% levy on all U.S. products, disappointing investors who
had hoped countries would negotiate with Trump before retaliating.
Technology
stocks led the bleeding Friday. Shares of iPhone maker Apple slumped 7%, bringing
its loss for the week to 13%. Artificial intelligence bellwether Nvidia pulled back 7% during
the session, while Tesla fell
10%. All three companies have large exposure to China and are among the hardest
hit from Beijing’s retaliatory duties.
Outside
of tech, Boeing and Caterpillar — big exporters to
China — led the Dow lower, falling 9% and nearly 6%, respectively.
“The
bull market is dead, and it was destroyed by ideologues and self-inflicted
wounds,” said Emily Bowersock Hill, CEO and founding partner at
Bowersock Capital Partners. “While the market may be close to the bottom
in the short-term, we are concerned about the impact of a global trade-war on
long-term economic growth.”
China’s
efforts to respond to Trump’s tariffs extended beyond reciprocal duties of
their own. Beijing added several companies to its so-called “unreliable
entities list,” which asserts that the firms have broken market rules or
contractual commitments. In addition, China opened an antitrust investigation
into DuPont on Friday,
sinking shares nearly 13%.
The
10-year Treasury yield fell
back below 4% Friday as investors flooded into bonds for safety,
pushing prices up and rates lower. The CBOE Volatility index, Wall
Street’s fear gauge surged above 40, an extreme level seen only during rapid
market declines.
Trump
appeared to be steadfast in the face of the markets backlash to his tariff
blitz announced Wednesday evening, posting on Truth Social Friday that his
“policies will never change.”
“The
fear now as we go into the weekend [is] the trade war escalates, and the US
doesn’t back down,” said Jay Woods, chief global strategist at Freedom Capital
Markets.
All
told, the S&P 500 dropped 9% on the week, its worst week since the breakout
of Covid in early 2020.
Stock
market today: Live updates
Nasdaq
tumbles to join Russell 2000 in bear market. Here’s what history says will
happen next.
The
Dow Jones Industrial Average enters correction territory, and the S&P 500
teeters on the edge of a bear market
Last Updated: April 4,
2025 at 4:42 p.m. ET
First Published: April 4, 2025 at 3:43 p.m. ET
The stock-market selloff picked up steam on Friday,
pushing the tech-heavy Nasdaq Composite into bear-market territory amid fears
that President Donald Trump’s sweeping tariffs have ignited a trade war that
will lead to a global economic slowdown.
The Nasdaq Composite on Friday fell
962.82 points, or 5.8%, to end at 15,587.79. The index has now officially
entered a bear market for the first time since 2022, according to Dow Jones
Market Data.
A bear market is widely defined as a decline of at
least 20% from a recent high.
Investors now want to know how long the tech-heavy
index could suffer in a bear market and, perhaps more importantly, how
technology stocks have tended to perform in periods after the Nasdaq closed in
such negative territory.
Since 1973, bear markets have typically lasted 111
trading days, or over five months, for the Nasdaq Composite. The last time the
index was in a bear market was when it fell over 22% from Aug. 15, 2022 to its
low on Dec. 28 of that year, according to Dow Jones Market Data.
History also shows that, going back to 1973, tech
stocks have typically risen in the first month after the Nasdaq entered a bear
market, with the index delivering an average return of 1.3% after 30 days and
7.1% over the following three months, according to Dow Jones Market Data
(see table below).
----U.S. stocks on Friday sank in another brutal day
on Wall Street, after China said the country will impose a 34% levy on all U.S. imports,
matching the tariff on Chinese goods coming into the U.S. slapped by President
Trump earlier this week. Investors worry the move could worsen trade tensions
between the world’s two largest economies and raise the probability of a global
recession.
Even a solid jobs report on Friday morning failed to
reassure markets, as it sent mixed signals about the economy. The
nonfarm-payrolls data from the Bureau of Labor Statistics showed the U.S. economy added a stronger-than-expected 228,000
jobs last month, a significant increase from February’s revised gains of
117,000. The unemployment rate in March ticked up to 4.2% from 4.1%.
U.S.
stocks see biggest 2-day wipeout in history as market loses $11 trillion
since Inauguration Day
Stocks erased a
combined $6.6 trillion in value on Thursday and Friday
Last Updated: April 4, 2025 at 4:49 p.m. ET
First Published: April 4, 2025 at 12:30 p.m. ET
Roughly $11.1 trillion has been wiped away from the
U.S. stock market since Jan. 17, the Friday before President Donald Trump took
the oath of office and began his second term, according to data from Dow Jones
Market Data.
Some $6.6 trillion of that figure was lost on
Thursday and Friday alone — the largest two-day wipeout of shareholder value on
record, Dow Jones data showed.
More, subscription required.
In other news.
J.P.Morgan lifts global
recession odds to 60% as US tariffs stoke fears
By Reuters April 4, 20257:37 AM GMT+1
April 4 (Reuters) - The risk of a U.S. and global
recession this year have risen to 60% from 40% earlier on the heels of
President Donald Trump's sweeping reciprocal tariffs, Wall Street brokerage
J.P. Morgan said.
On Wednesday, Trump imposed a 10% baseline tariff on all imports to the
U.S. and higher duties on dozens of other countries.
"Disruptive US policies has been recognized as
the biggest risk to the global outlook all year," J.P. Morgan strategists,
led by Bruce Kasman, said in a note on Thursday, adding that US trade policy
has turned less business-friendly than anticipated.
"The effect of this tax hike is likely to be
magnified through retaliation, a slide in US business sentiment, and supply
chain disruptions," Kasman said.
Other Wall Street brokerages, including Barclays and Deutsche Bank, also warned that the U.S.
economy faces a higher risk of slipping into a recession this year if Trump's
new levies remain in place.
However, Kasman expects the shock of the tariffs to
be "modestly dampened" by the prospect of further rate cuts in the
U.S.
J.P.Morgan reiterated its forecast of two 25-basis
point rate reductions by the Federal Reserve in June and September this year,
while investors expect a total of four rate cuts in 2025, per data compiled by
LSEG.
J.P.Morgan lifts global recession odds to 60% as US tariffs stoke fears |
Reuters
Goldman cuts oil price
forecasts amid tariff fears, higher OPEC+ supply
April 4, 20256:01 AM GMT+1
April 4 (Reuters) - Goldman Sachs lowered its
forecast for Brent crude's average price this year by 5.5% to $69 a barrel and
for WTI prices by 4.3% to $66, citing the risks of higher OPEC+ supply and the
global trade war triggering a recession.
The Wall Street brokerage also chopped its 2026 average
price forecast for Brent by 9% to $62 and for WTI by 6.3% to $59, and warned
that the new estimates could be lowered further.
"The risks to our reduced oil price forecast
are to the downside, especially for 2026, given growing risks of recession and
to a lesser extent of higher OPEC+ supply," Goldman analysts said in a
note.
Brent crude was priced at $69.59 a barrel as of 0408
GMT on Friday, while WTI was at $66.39.
Crude prices posted their biggest percentage drops
since 2022 on Thursday after U.S. President Donald Trump slapped reciprocal tariffs on many countries and
eight OPEC+ members unexpectedly advanced their plan to phase out production cuts by boosting output in May.
The latter, said Goldman, showed OPEC's flexibility
to rapidly implement large output hikes, which diminished the likelihood of a
price boost in the short term from lower supply.
The brokerage said it now expects oil demand to grow
by only 600,000 barrels per day (bpd) this year, down from its previous
forecast of 900,000 bpd, and to increase by 700,000 bpd in 2026.
Goldman cuts oil price forecasts amid tariff fears, higher OPEC+ supply |
Reuters
“I
think it’s going very well.”
President
Trump, April 3, 2025.
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.
El-Erian
says U.S. recession risks are now ‘uncomfortably high’
Published
Fri, Apr 4 2025 3:23 AM EDT
President Donald Trump’s extensive raft of import tariffs are
putting the U.S. economy at risk of recession, Allianz’s Chief Economic Advisor
Mohamed El-Erian warned on Friday.
He added that Trump’s swathe of so-called reciprocal
tariffs could have a significant effect on the global economy.
“You’ve had a major repricing of growth prospects,
with a recession in the U.S. going up to 50% probability, you’ve seen an
increase in inflation expectations, up to 3.5%,” he told CNBC’s Silvia Amaro on
the sidelines of the Ambrosetti Forum in Cernobbio, Italy.
“I don’t think [a U.S. recession] is inevitable
because the structure of the economy is so strong, but the risk has become
uncomfortably high.”
El-Erian also warned that markets were
underestimating the inflation impact of the tariffs regime.
“The first reaction has been concerns about growth.
We haven’t had two other reactions yet: what will happen to growth in other
countries, and that makes a question mark on whether the dollar weakness will
continue, and then what does the [Federal Reserve] do?” he questioned.
“I think if we’re lucky we’ll get one rate cut, not
four, and it wouldn’t surprise me if we get none,” El-Erian added.
“If it’s a normal Fed — and I say this qualification
with a lot of emphasis, because this has not been a normal Fed — we would
unlikely to get even one rate cut.”
Liberation day: Mohamed El-Erian says Trump tariffs risk US recession
With tariff details in hand, Fed now has to weigh
inflation risks against blow to growth
3 April 2025
WASHINGTON (Reuters)
-U.S. Federal Reserve officials who've said they needed more details before
estimating the economic impact of President Donald Trump's trade plans got
perhaps more than they bargained for on Wednesday when he unveiled sweeping
tariffs analysts say could dramatically reshuffle the country's economic
outlook.
The levies, which Trump
gleefully displayed as a globe-spanning leaderboard of import tax rates,
feature a baseline 10% for major trading partners like the European Union,
higher still at 25% for Canada and Mexico, a massive 46% on Vietnam and
potentially more than 50% for China. Within hours economists were penciling in
a U.S. recession and drawing comparisons with the 1930s and even the late
1800s, early in the country's industrial development.
On average imports may
now carry a tax as high as 27%, Citi economists estimated, with higher levies
on some types of goods and some countries and lower ones on others. Less than
three months ago at the end of Joe Biden's presidency, that rate was about 2.5%.
If the logic of the
administration's detailed plans escaped many private sector analysts -
administration officials say it will lead to American economic renewal after a
"transition" - the implications had already begun to register among
Federal Reserve officials.
After battling inflation
for two years and coming close to containing it while keeping the unemployment
rate low, U.S. central bankers are now wrestling with a concept they'd rather
avoid - stagflation, or a situation where prices and joblessness rise together
as they did in the 1970s, a low point for the Fed.
At the moment "we're
certainly not in a stagflationary environment," Fed Governor Adriana
Kugler said on Wednesday in remarks given just as Trump was unveiling his chart
of tariff rates in the Rose Garden.
But "we may be in a
situation where we're already seeing some upside risks to inflation and some
real increases in inflation, at least in some categories...We may be seeing
down the road a little bit of a slowdown as well," Kugler said. "We're
paying close attention about, how much will that slowdown mean? How much will
those upside rates to inflation be realized?"
Stagflation, she said,
was by contrast "a big word...It means really corrosive inflation...And it
means you have negative economic activity. You have a recession."
Some economists already
were seeing the economy moving in that direction and were cutting forecasts for
U.S. growth, if not worse.
"This is a
recession-producing turn – if these tariffs stay in place," wrote TS
Lombard economist Steven Blitz. "The damage from (Trump's) tack to reset
trade may very well create a worse, less-healthy outcome."
More
With tariff details in hand, Fed now has to
weigh inflation risks against blow to growth
Technology
Update.
With events happening
fast in the development of solar power and graphene, I’ve added this section.
New battery tech makes sub-zero EV charging 5x faster
By Abhimanyu Ghoshal April 03, 2025
One of the things you might not learn about electric vehicles (EV)
until you live with one is that they charge slower in cold temperatures, which
means you might have to spend longer at a charging station on long winter
drives.
In addition, the climate's impact on your car's battery chemistry,
and the power drawn when you heat the cabin and seats can together sap
about 25% of range when you're cruising at 70 mph (113 km/h), compared with
driving at that speed in mild weather.
Researchers at the University of Michigan have a way to tackle the
first problem. By slightly altering the manufacturing process for lithium-ion
EV batteries, their technique can enable rapid charging at awfully low
temperatures – up to five times as fast – without reducing their energy
density.
To be precise, the team's method enables '6C' charging at
temperatures as low as 14 °F (-10 °C). The 'C' here is a way to express the
charging speed relative to the battery's capacity. So, for example, for a car
with a 50-kWh battery, a 1C charging rate would mean charging at 50 kW, and a
6C charging rate would mean charging at 300 kW (6 × 50 kW). That's ridiculously
fast – and potentially good news for future EV owners in cold climes.
Why do cars charge more slowly in the cold? It's because the
movement of lithium ions back and forth between electrodes via a liquid
electrolyte in a battery slows down. This reduces both the charging rate as
well as the battery's power.
So how do you speed up EV charging? One way is to follow
researcher Neil Dasgupta's method of laser drilling tiny pathways in the
graphite anode that receives lithium ions during charging.
You'll find that that this works well at room temperature, but in
the cold, a chemical plating of lithium formed on the surface of the anode and
prevented it from reacting with the electrolyte. So you'll need to go one step
further.
By coating the laser drilled graphite anode with a glassy material
made of lithium borate-carbonate, charging can be sped up by five times the
rate observed in below-freezing temperatures. The team published
a paper documenting this work in the journal Joule last
month.
The researchers note that this has the potential to address one of
the major concerns cited by adults in
the US surveyed by the American Automobile Association (AAA) last year about
interest in purchasing EVs. They intend to explore ways to integrate
their method into battery manufacturing processes – so hopefully, we'll soon
see electric cars that charge as quickly in the cold as they do in more
pleasant weather.
Source: University
of Michigan
New battery tech
makes sub-zero EV charging 5x faster
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt Clocks (usdebtclock.org)
This
weekend’s music diversion. Approx. 13 minutes.
Pasquale
Bini (1716-1770) - Concerto grosso con Violino Principale
Pasquale Bini
(1716-1770) - Concerto grosso con Violino Principale - YouTube
This
weekend’s chess diversion. Approx. 14 minutes.
This
Move Belongs in Chess Books!
This Move Belongs
in Chess Books! - YouTube
This
weekend’s reality check. Canada’s US tariffs. Approx. 12 minutes.
Is
Trump right about Canada charging 250% tariffs? | About That
Is Trump right
about Canada charging 250% tariffs? | About That - YouTube
I'd throw dollars out of helicopters if I had to, to stimulate
the economy.
Ben Bernanke
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