Baltic
Dry Index. 1305 +38
Brent Crude 64.97
Spot Gold 3220 US 2 Year Yield 3.96 -0.09
US Federal Debt. 36.855 trillion!!!
Wealth is not to feed our egos but to feed the hungry and to help people help themselves.
Andrew Carnegie
In the stock casinos, US hopium, Asian realism. In Europe, that USA v EU trade war is just about to start.
In the Great Trump Tariff War on friend and foe alike, official statistics from here on out, will start to reflect the increasing damage. The phony trade war over, the real trade war is now getting underway.
Asia-Pacific markets mostly fall as investors
assess U.S.-China trade developments
Updated Thu, May 15 2025 3:03 AM EDT
Asia-Pacific markets mostly fell Thursday,
breaking ranks with Wall Street as investors assessed U.S.-China trade
developments.
Japan’s benchmark Nikkei 225 fell 0.98% to
close at 37,755.51, while the Topix lost 0.88% to end the trading day at
2,738.96. South Korea’s Kospi declined 0.73% to close at 2,621.36 while the
small-cap Kosdaq slipped 0.79% to close at 733.23.
Hong Kong’s Hang Seng index dropped
0.82%, while mainland China’s CSI 300 lost 0.87%. India’s Nifty 50 slipped
0.16%.
Australia’s benchmark S&P/ASX 200
bucked the wider trend in the region to close 0.22% higher at 8,297.5.
“While markets have largely priced in peak
tariff-related macro stress, we remain wary of a second wave of volatility,
this time driven by fiscal policy uncertainty and weakening U.S. hard data,”
Citi analysts said in a note.
U.S. stock futures slipped in overnight
trading after the S&P 500 index rose for a third straight day. China and
the U.S. hammered out a temporary suspension of their tit-for-tat tariff
dispute earlier this week.
Overnight, the S&P 500 rose modestly,
extending a strong start to the week that pushed the benchmark into the green
for the year. The broad market
index inched up 0.10% to close at 5,892.58, while the Nasdaq Composite gained
0.72% and ended at 19,146.81. However, the Dow Jones Industrial Average fell
89.37 points, or 0.21%, to settle at 42,051.06.
Asia-Pacific
live: U.S.-China trade
CNBC Daily Open: U.S. stocks are buoyant for now —
but lurking dangers could weigh them down
Published Thu, May 15 2025 9:09 PM EDT
There’s a lightness in the air in Wall
Street. Stocks have been rising throughout the week. The S&P 500 has just
ended its fourth straight session in the green, giving it a 4.54% bump so far
over the past four days.
Tariffs are looking less thorny, for sure,
as the U.S. negotiates agreements with other countries. But that’s not to say
it’ll be a perfectly smooth path ahead.
For instance, despite its agreement with
the U.S., China is still withholding rare earth metals, crucial for important
industries such as defense and energy, from being exported to the U.S.
Similarly, even as India
negotiates a deal with America, U.S. President Donald Trump appears to want
more than just levies on U.S. imports cut. Trump told Apple CEO Tim Cook he
doesn’t want the Cupertino-based company “building in India.” It’s hard to
imagine India agreeing to keep Apple’s manufacturing out — or for The Big Apple
to actually start producing Apple products.
U.S. Federal Reserve Chair Jerome Powell
seemed cognizant of such complications and warned on Thursday that “supply
shocks” could be “more frequent, and potentially more persistent” in the
future.
The sense of buoyancy in markets, then,
could be a head rush — evoked by the U.S.-China trade deal over the weekend —
that could dissipate once the gravity of the economic headwinds takes over
again.
More
CNBC
Daily Open: U.S. stocks are buoyant — but dangers lurk ahead
In trade war news, the global distress is
only just starting to appear.
Japan’s economy contracts for the first time in a
year as exports fall, shrinking more than expected by 0.2%
Published Thu, May 15 2025 8:10 PM EDT
Japan’s economy shrank for the first time
in a year, contracting 0.2% in the March quarter as exports declined sharply,
preliminary government data showed Friday.
The gross domestic product data was poorer
compared to the 0.1% contraction expected by economists polled by Reuters.
On an annualized basis, Japan’s GDP
contracted 0.7% in the first quarter, also more than the 0.2% fall expected in
the Reuters poll.
Exports fell 0.6% quarter-on-quarter,
shedding 0.8 percentage points off the GDP as uncertainties caused by U.S.
President Donald Trump’s trade policies affected Japan’s export-heavy economy.
Domestic demand, however, was a bright spot, growing 0.6% in the same quarter
and adding 0.7 percentage points to the GDP.
On a year-on-year basis, however, Japan’s GDP expanded 1.7%, the largest
expansion since the first quarter of 2023 and a stronger showing compared to
the 1.3% growth seen in the fourth quarter.
Japan’s GDP data comes at a time when the
country is locked in trade negotiations with the U.S., with initial talks
between both sides so far not yielding a conclusive deal.
----On Friday, Japan’s top trade
negotiator, Ryosei Akazawa, reportedly said that there was no notable impact of
U.S. tariffs on Japan’s first-quarter GDP.
However, he warned of downside risks to
the economy from U.S. trade policy and that the government would “take all
necessary steps” to support impacted firms.
More
Japan's
economy shrinks 0.2% for the first time in a year
A Bumper Kansas Wheat Crop Is Getting Fed to Cows
May 15, 2025
It’s a bad sign for wheat farmers when
their crops end up feeding cattle. This year, overseas buyers are turning away
from the US amid Trump’s trade war. Read the Story
World
Economic Forum Scrambles to Find a New Leader - Bloomberg
In other news, rising layoffs.
HSBC to cut 10% of its workforce in France
14 May 2025
PARIS (Reuters) -HSBC plans to cut 348
jobs in France through a voluntary redundancy scheme, amounting to about 10% of
its workforce in the country, the bank said on Wednesday.
The job losses are part of a cost-cutting
drive led by CEO Georges Elhedery, who aims to reduce expenses by $1.8 billion
by the end of 2026.
HSBC has already sold its retail and
insurance divisions in France as part of a retreat from slow-growing European
and North American markets where the bank has struggled against larger domestic
players.
"These developments in France reflect
the acceleration of the implementation of HSBC's strategy aimed at simplifying
the organisation to make it more agile ... adapting to an uncertain economic
environment, growing competition and high internal costs," HSBC said.
HSBC to cut 10% of
its workforce in France
Microsoft's second biggest layoffs ever hits over
6,000 employees; these are the positions likely to be impacted
14 May 2025
Microsoft has announced that it will lay
off 3% of its global workforce, affecting thousands of employees across all
levels, teams, and geographies, amounting to over 6,000 employees. The cuts at
the Redmond giant, which employed 228,000 people as of last June, aim to reduce
management layers and streamline operations.
"We continue to implement
organisational changes necessary to best position the company for success in a
dynamic marketplace," a Microsoft spokesperson told CNBC in a statement.
The latest round of job cuts Microsoft's
largest reduction since eliminating 10,000 roles in 2023. Unlike January's
smaller performance-based cuts, the company indicated these layoffs are
structural in nature.
Layoffs to impact management staff; coders
and engineering employees may stay safe
These cuts may particularly impact the
middle management roles, as the company seeks to create a more streamlined
hierarchy by increasing each manager's "span of control." Microsoft,
as reported by Business Insider previously, aims to prioritise engineering
talent as it continues investing heavily in artificial intelligence
initiatives.
Sources told Business Insider that laid
off employees will stay on the payroll for the 60 days after their termination.
Further, the affected staff will also be reportedly eligible for rewards and
bonuses.
Microsoft has introduced new rehire ban
and performance management overhaul
The workforce reduction comes amid
significant changes to Microsoft's performance management system. According to
internal documents viewed by Business Insider, the company has implemented a
two-year rehire ban for employees forced out due to performance issues.
Microsoft has also introduced a "good
attrition" metric to track desirable employee departures. This approach
mirrors Amazon's controversial "unregretted attrition" system and
signals Microsoft's intent to more aggressively manage underperforming staff.
Under the new system, employees facing
performance issues must either enter a performance improvement plan (PIP) with
"clear expectations and a timeline for improvement" or accept a
"Global Voluntary Separation Agreement" with 16 weeks of severance
pay. Those who choose the PIP path have just five days to decide and will no
longer be eligible for the severance package if they opt for the improvement
plan.
Management roles are being cut across the
industry as tech giants push for efficiency
Microsoft's restructuring reflects a
broader trend across the tech industry toward flatter organizational structures
and higher engineering efficiency. The company is reportedly focusing on
reducing its "PM ratio," the proportion of managers to engineers,
across teams.
Similar strategies have been implemented
at other tech giants, including Amazon and Google, where the top layer of the
hierarchy were let go. Meta is also expected to let go off several thousand
employees this year, as CEO Mark Zuckerberg pushes for a “year of efficiency.”
Walmart CFO says price hikes from tariffs could
start later this month, as retailer beats on earnings
Published Thu, May 15 2025 12:01 AM EDT
Walmart on Thursday fell just short
of quarterly sales estimates, as even the world’s largest retailer said it
would feel the pinch of higher tariffs.
Even so, the Arkansas-based discounter
beat quarterly earnings expectations and stuck by its full-year forecast, which
calls for sales to grow 3% to 4% and adjusted earnings of $2.50 to $2.60 per
share for the fiscal year. That cautious profit outlook had disappointed Wall
Street in
February, but the company’s shares rose slightly on Thursday in premarket
trading.
Walmart also marked a milestone: It posted
its first profitable quarter for its e-commerce business both in
the U.S. and globally. The business has benefited from the growth of
higher-margin moneymakers, including online advertising and Walmart’s
third-party marketplace.
In an interview with CNBC, Chief Financial
Officer John David Rainey said tariffs are “still too high” – even with
the recently announced
agreement to
lower duties on imports from China to 30% for 90 days.
“We’re wired for everyday low prices, but
the magnitude of these increases is more than any retailer can absorb,” he
said. “It’s more than any supplier can absorb. And so I’m concerned that
consumer is going to start seeing higher prices. You’ll begin to see that,
likely towards the tail end of this month, and then certainly much more in
June.”
Walmart said it expects net sales to
increase 3.5% to 4.5% for the fiscal second quarter, but declined to provide
guidance for earnings per share or operating income growth because of
fluctuating U.S. tariff policy.
More
Walmart (WMT) Q1
2026 earnings
The greatest astonishment of my life was the discovery that the man who does the work is not the man who gets rich.
Andrew Carnegie
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.
Today,
another red flag on the US economy. This time it has nothing to do with
President Trump’s chaotic tariff wars, but see the last two articles in this
section.
Student
loan debt collection restarts: How to avoid garnished wages, tax refund
seizures
May
14, 2025
For
five years, student
loan borrowers who
consistently couldn't pay their bills did not face the threat of debt
collection. But all that extra breathing room is now gone.
About
195,000 borrowers who
haven't paid their student loan bills for at least nine months received a
30-day official notice the week of May 5 from the U.S. Department of Treasury
notifying them that their federal benefits checks will be cut in early June.
Later
this summer, the Education Department said, all 5.3 million defaulted borrowers
will receive a 30-day notice their wages will be garnished to cover their long
unpaid student debt. Loan collection has been on pause since the early days of
the COVID-19 pandemic in 2020.
Borrowers
in default are being urged to contact the Education Department's default resolution group to make a
monthly payment, enroll in an income-driven repayment plan, or sign up for loan
rehabilitation.
"This
may be one of the largest groups of people to simultaneously go into default at
the same time," said Kathryn Ellywicz, a former financial counselor at
GreenPath Financial Wellness, a national, nonprofit counseling and debt
management group based in Farmington Hills.
Dealing
with debt collection will
be a massive headache for many as paychecks will be dinged, tax refunds will be
confiscated, and even Social Security benefits are at risk of being taken to
cover that unpaid college debt. But there are some steps that can be taken to
better manage the pain.
The
good news is that many borrowers still can take action to avoid debt collection
by opting for a pathway out of default.
The
challenge, and advocates say it's a serious one, is that many borrowers will
find it much tougher to reach someone at the Education
Department after
the Trump administration cut
the staff nearly
in half.
"What
we're hearing from borrowers is that they're having a very hard time actually
taking advantage of those rights. Their calls are getting dropped. They're
getting bounced around. They're waiting on hold for hours," said Mike
Pierce, executive director of the Student Borrower Protection Center, an
advocacy group based in Washington, D.C.
Borrowers
will need to do more work, possibly making repeated calls, to get on track.
Pierce said many will need to contact their congressional representative to get
the ball rolling, if they run into consistent problems. Members of Congress
have caseworkers who help constituents experiencing issues with a federal
agency. His group offers tips online for how to ask for help at ProtectBorrowers.org/caseworktool.
What's
concerning is that many people who are in default only took some classes in
college and don't have college degrees or good paying jobs now, Pierce said.
They will need some way to resolve the issue so that their wages or tax refunds
aren't taken as part of debt collection.
Many
borrowers with lower student loan balances would have seen their student
loans forgiven under
former President Joe Biden's debt
forgiveness plan. In 2023, the U.S. Supreme Court blocked that effort, which
called for forgiving up
to $10,000 — or in some cases, up to $20,000 — of federal
student loan debt for individual borrowers.
More
Student loan debt
collection restarts: How to avoid garnished wages, tax refund seizures
Seriously
delinquent student loan borrowers hit record high and climbing, TransUnion says
May
5, 2025
Another
credit agency is ringing the alarm bell on student loan delinquencies just as
the Department of Education is resuming
involuntary collections on defaulted debt.
An
all-time high 20.5% of student loan borrowers are seriously delinquent, or
90-plus days overdue, through February, according to research by TransUnion
released on May 5. This compares to 11.5% in February 2020, just before the
pandemic, and may even be understated.
"More
than 1 in 5 student loan borrowers with a payment due have been reported as
seriously delinquent, but this figure may in fact be much higher," said
Michele Raneri, vice president and head of research at TransUnion.
Last
month, credit scoring company FICO warned of a spike
in student loan borrowers falling into serious delinquency.
A
serious delinquency can be a major hit on credit scores, increasing the cost of
loans or limiting how much people may be able to borrow in the future.
"Consumers
may find themselves shocked by the dramatic and immediate impact that a default
can have on their credit scores,” said Joshua Turnbull, senior vice president
and head of consumer lending at TransUnion.
How
much can credit scores drop?
Student
loan payments resumed in September 2023, with borrowers given a one-year
“on-ramp” during which credit bureaus didn’t report nonpayment to credit
bureaus. Last month, the Education Department said it would resume collection
activities,
effective May 5.
Consumers
who had faced default since the end of the on-ramp saw their credit scores
decline by an average of 63 points, TransUnion said.
In
April, FICO said the average score that lenders use to assess risk fell to 715, down a point
from January and two points from a year ago. The decline reflected a rise in
90-plus day delinquencies in the past six months, partly because federal student
loan delinquencies are being reported on credit files for the first time
since March 2020, FICO said.
More
Delinquent student
loans jump just as involuntary collections resume
Group
of 21 economies — including U.S. and China — warns of growth slowdown over
trade tensions
May
15, 2025
An
intergovernmental grouping of 21 economies including the United States and
China warned Thursday that their collective growth risks a sharp slowdown, as
tariff tensions and policy uncertainty weigh on investment and trade.
The Asia Pacific
Economic Cooperation forecasts
growth to drop to 2.6% in 2025, from 3.6% in the prior year.
“From
tariff hikes and retaliatory measures to the suspension of trade facilitation
procedures and the proliferation of non-tariff barriers, we are witnessing an
environment that is not conducive to trade,” said Carlos Kuriyama, Director of
the APEC
Policy Support Unit,
at a meeting in South Korea.
Kuriyama
also said that the uncertainty was weighing on business confidence, leading
many firms to delay investments and new product launches until the situation
turned “more predictable.”
The
gathering comes at time when U.S. President Donald Trump’s aggressive trade
stance and massive “reciprocal” tariffs have invited retaliatory measures from
partners. While the “reciprocal” tariffs have been suspended, the environment
remains fraught with uncertainty.
Kuriyama
noted that restoring confidence in trade requires not only easing tensions, but
also actions such as strengthening supply chain resilience and improving
transparency of trade rules and procedures.
Comments
from former and current trade officials to CNBC also echoed this view,
emphasizing the importance of predictability in global trade.
Former
Canadian trade minister Mary Ng told “Squawk Box Asia” that what
companies, entrepreneurs, and countries are looking for trade agreements that
offer trading partners a certain predictability for doing business with each
other.
Ng
was trade minister when Trump imposed 25% levies on steel and aluminum — U.S.
is Canada’s largest market for steel — and had sought a formal consultation
with the U.S. to address tariff-related issues.
“I
think that all of us owe it to our economies, to our people, to our businesses,
to do our level best, to create the right conditions environments, so that
predictability is there, so that the rules are there, so that business can
count on that and they can plan on that. That’s what they look to governments
to do.”
Malaysian
Trade and Investment Minister Tengku Zafrul Aziz, who welcomed the recent
de-escalation of trade tensions between the U.S. and China, emphasized on the
importance of dialogue between countries.
Malaysia
and other ASEAN countries believe in a “rules-based multilateral trading
system, he told CNBC.
World
Trade Organization Director-General Ngozi Okonjo-Iweala also attended the event
and urged that “there should be dialogue with the U.S. to find out why did we
get where we are and what can we do about it”
She
cautioned about U.S.-China tensions, saying that “if the world breaks up into
two global trading blocks, we could lose 7% in global GDP in the longer term.”
APEC, group of 21
economies, warns of growth slowdown over trade tensions
US
producer prices tumble in April as tariffs squeeze profit margins
15
May 2025
US
wholesale prices fell the most in five years in April, with a historic drop in
gauges measuring profit margins suggesting businesses have so far refrained
from passing along the cost of higher tariffs.
The
producer price index fell 0.5 per cent month-on-month in April, according to
figures published by the Bureau of Labor Statistics on Thursday, from no change
in March. That was the first monthly decline since October 2023 and the biggest
drop since April 2020. Economists expected a 0.2 per cent increase.
“Core”
PPI, which strips out volatile food and energy prices, dropped 0.4 per cent,
the biggest decline most since 2015. The year-on-year increases in headline and
core PPI eased to 2.4 per cent and 3.1 per cent, respectively.
PPI,
which tracks changes in prices that businesses receive for their goods and
services, was closely followed by economists this month, searching for signs of
any potential impact that Donald Trump’s tariffs on US trading partners had on
American businesses.
Although
there were limited signs of surging inflation, Thursday’s data suggested US
manufacturers and service providers were yet to pass the cost of tariffs on to
consumers and profit margins were instead being squeezed.
The
drop in PPI during April was largely due to a 0.7 per cent drop in services
prices, their biggest monthly drop since the index began in 2009. The BLS said
more than two-thirds of that decline could be traced to a margins for final
demand trade services, an index that measures changes in margins received by
wholesalers and retailers.
“We
can see the start of the trade war hitting corporate margins here and I doubt
it will be much longer until that is passed on to the consumer,” said Joe
Brusuelas, chief economist at tax and consulting firm RSM US.
The
PPI, which is often considered a leading indicator of inflation, follows
figures published on Tuesday showed that the annual increase in the consumer
price index dropped more than expected to 2.3 per cent in April.
Economists
cautioned that most of the impact of Trump’s new import duties had yet to be
felt. “This is a good month for cooling inflation, but tariffs are going to
knock us off this course,” said Ryan Sweet, chief US economist at Oxford
Economics.
More
US
producer prices tumble in April as tariffs squeeze profit margins
Covid-19
Corner
This section will continue only occasionally when something of interest occurs.
Hong Kong and Singapore report new Covid wave
15 May 2025
Covid cases
are spiking across Southeast Asia,
especially in Hong Kong and Singapore.
Health officials in Hong Kong have
reported a sharp rise in Covid cases,
indicating the city has entered a new wave. The infection
rate has climbed from 1.7 per cent in mid-March to 11.4 per cent now,
exceeding the peak recorded in August 2024, according to data released by the
Centre for Health Protection on Tuesday.
Covid activity in Hong
Kong is currently “quite high”, according to Albert Au, head of the
Communicable Disease Branch at the Centre for Health Protection.
The proportion of
respiratory samples testing positive for the virus has
recently hit its highest level in a year, Bloomberg reported.
In Singapore,
the health ministry has issued its first Covid infection update in about a
year, reporting a 28 per cent rise in estimated cases to 14,200 for the week
ending 3 May compared to the previous week.
The health ministry and
the Communicable Diseases Agency said they were monitoring the increase in
Covid infections in the city state.
Although daily
hospitalisations have climbed by about 30 per cent, the health ministry said in
a statement, “there is no indication that the variants circulating locally are
more transmissible or cause more severe disease compared to previously
circulating variants”.
Singapore now releases
Covid case numbers only when there’s a significant surge.
More
Hong
Kong and Singapore report new Covid wave
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.
Battery
facility sparks fire and pollution concerns from locals
15 May
2025
Plans
for a lithium battery storage facility in East Devon have being rejected.
Clearstone
Energy wanted to build and operate the battery energy storage system, or BESS,
south of Hazelhurst Raymonds Hill in Axminster, but its hopes were dashed after
planners rejected the scheme after a three-and-a-half hour debate following
residents’ concerns about fire risks and the potential pollution of a vital
water source.
Several
residents attended East Devon District
Council’s planning meeting to outline their misgivings, including worries about
a nearby aquifer that supplies drinking water to homes being contaminated if a
fault occurs.
Examples
of BESS fires around the country were highlighted as evidence about why the
scheme should be refused, and there were doubts that the proposed capacity for
any firefighting water runoff would be sufficient.
However,
the developer claimed the manufacturer of its equipment had a “100 per cent
safety record”, that its proposal met and exceeded guidance, and that a fire on
site was “highly unlikely”.
Elliot
Jones, speaking on behalf of Hawkchurch Action Group, said the application
being considered raised “profound risks to public safety and environmental
integrity”, which he claimed mirrored the concerns in the Pound Road decision.
“The
same [planning] conditions applied to Pound Road as are being proposed here,
but both sit above the same aquifer,” he said.
“The
fire service raised no objections to the Pound Road scheme but the Planning
Inspectorate dismissed the appeal as the applicant couldn’t show there was no
risk.”
In the
Pound Road appeal, the planning inspector stated it had “not been demonstrated
that the proposal would not be a significant risk to local residents and the
environment”.
He
added that if the firewater container was inadequate, then “contaminated water
can percolate into the aquifer, polluting it irreversibly”.
More
Battery facility
sparks fire and pollution concerns from locals
Scientists caution against charging electric vehicles at home
overnight
Tue, May 13, 2025 at 12:51 PM GMT+1
----Recent research shows charging habits
are more complex than expected. Most drivers prefer plugging in at home or
nearby, especially overnight. While this offers convenience, it creates
problems for the power grid, which is already under stress during peak evening
hours.
A new study in Applied
Energy from Stanford
University sounds the alarm. “We must move
away from our current model of overnight home charging,” the researchers argue.
Without change, the rapid growth in EVs could do more harm than good.
The study looked at trends in the western U.S.
through 2035. If overnight home charging remains the norm, regional electricity
demand could jump by up to 25% during peak hours. That kind of spike would
strain the system.
Meeting this demand would likely mean adding power
from natural
gas—an outcome that undermines efforts to
cut carbon. Without strategic shifts in when and where people charge, the push
to electrify vehicles could backfire.
In contrast, shifting charging to daytime hours,
particularly during periods of abundant solar
energy, could alleviate grid stress and reduce
greenhouse gas emissions.
Ram Rajagopal, co-senior author of the study,
emphasizes the need for policymakers to encourage daytime charging through
utility rate adjustments and investments in workplace and public charging
infrastructure.
“Policymakers should consider utility rates that
encourage day charging and incentivize investment in charging infrastructure to
shift drivers from home to work for charging,” Rajagopal stated.
more
Scientists caution
against charging electric vehicles at home overnight
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt
Clocks (usdebtclock.org)
Another weekend and the Italian Grand Prix weekend
too. But what fiendish new disruption will Team Trump spring on the reeling
global economy next week? Have a great weekend everyone.
"If
everything seems under control, you're just not going fast enough."
Mario
Andretti
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