Thursday, 12 June 2025

PPI Day. USA v China, Deal Or No Deal? Oil Surges.

 Baltic Dry Index. 1738 +58            Brent Crude 69.49

Spot Gold 3372                  US 2 Year Yield 3.94 -0.07  

US Federal Debt. 36.967 trillion  

US GDP 30.066 trillion.

If everyone is thinking alike, then no one is thinking.

Benjamin Franklin

According to President Trump, the USA won!

Trump said earlier in a Truth Social post that the deal with China was “done, subject to final approval with President Xi and me.”

U.S. President Donald Trump on Wednesday said China will supply rare earths up front to the U.S. as part of a trade agreement.

The relationship between the world’s two largest economies is “done,” Trump said in a post on Truth Social, while adding, “WE ARE GETTING A TOTAL OF 55% TARIFFS, CHINA IS GETTING 10%.”

In the Asian stock casinos, the punters aren’t so sure.

Why would President Xi supply “up front” rare earths to America in exchange for a mere promise that the unpredictable President Trump might roll back some semi-conductor restrictions and perhaps allow a few pre-screened Chinese students to attend a few US universities?

President Trump, “after you”. President Xi, “no after you”.  Tomorrow, why China won.

Oil surges on news Israel is about to attack Iran. Another oil shock if it does?

Asia-Pacific markets trade mixed as investors assess Trump claims of 'done' deal with China

Updated Thu, Jun 12 2025 11:53 PM EDT

Asia-Pacific markets traded mixed as investors assessed U.S. President Donald Trump’s declaration that a trade deal with China was “done.”

Chinese imports would invite 55% tariffs, Trump suggested. Commerce Secretary Howard Lutnick confirmed that tariffs on China will stay at that level.

Japan’s benchmark Nikkei 225 was down 0.58% while the broader Topix fell 0.24%. South Korea’s Kospi climbed 0.83%, and the small-cap Kosdaq rose 0.79%.

Australia’s S&P/ASX 200 was flat.

Hong Kong’s Hang Seng index fell 0.51%, and mainland China’s CSI 300 was flat.

India’s Nifty 50 added 0.11% at the open.

U.S. stock futures fell as traders weighed a preliminary U.S.-China trade agreement and new inflation data. S&P 500 futures traded down 0.2%, along with Nasdaq 100 futuresFutures tied to the Dow Jones Industrial Average were also lower by 72 points, or 0.2%.

These moves come after U.S. consumer prices rose less than expected in May. The consumer price index climbed 0.1% for the month, compared with the Dow Jones forecast for a 0.2% rise. Core CPI, which excludes food and energy prices, also rose less than expected.

Overnight stateside, all three key benchmarks closed lower. The market’s recent run higher took a breather as major indexes ended the session near previous closing levels.

Trump said earlier in a Truth Social post that the deal with China was “done, subject to final approval with President Xi and me.”

As part of the deal framework, he said that magnets and “any necessary rare earths” will be supplied up front by China and the U.S. will allow Chinese students to attend U.S. colleges and universities, adding that “WE ARE GETTING A TOTAL OF 55% TARIFFS, CHINA IS GETTING 10%.”

That didn’t excite stock or bond investors, Ed Yardeni, president of Yardeni Research wrote in a note published Thursday. “Perhaps, they were unsettled that Trump also said he is less confident that Iran will agree to stop uranium enrichment in a nuclear deal with Washington,” he said.

Equities pulled back as the market considered the reality of much higher tariffs being here to stay, said ANZ economists in a note.

Asia-Pacific markets today live: Trump-China deal, Thailand CPI

Trump says China will supply rare earths in ‘done’ deal

Published Wed, Jun 11 2025 8:22 AM EDT Updated Wed, Jun 11 2025 2:54 PM EDT

U.S. President Donald Trump on Wednesday said China will supply rare earths up front to the U.S. as part of a trade agreement.

The relationship between the world’s two largest economies is “done,” Trump said in a post on Truth Social, while adding, “WE ARE GETTING A TOTAL OF 55% TARIFFS, CHINA IS GETTING 10%.”

He added that magnets and “any necessary rare earths” will be supplied up front by China and that the U.S. will in turn make certain concessions such as allowing Chinese students to attend U.S. colleges and universities.

The agreement is subject to final approval with himself and China President Xi Jinping, the U.S. president said, adding he intends to work closely with Xi to open up China to American trade, describing the prospect as “a great WIN for both countries!!!”

Representatives from both sides had on Tuesday revealed that a deal had been reached on trade after a second day of high-level talks in London.

“We have reached a framework to implement the Geneva consensus and the call between the two presidents,” U.S. Commerce Secretary Howard Lutnick told reporters.

That echoed comments to reporters from Li Chenggang, China’s international trade representative and a vice minister at China’s Commerce Ministry.

Rare earth elements and magnets widely used by the automotive and defense sectors emerged as a key sticking point between the world’s two largest economies.

China’s Ministry of Commerce in early April imposed export restrictions on strategically important minerals in response to Trump’s tariff increase on Beijing’s exported products.

Both sides had accused each other of reneging on a preliminary trade deal struck in Switzerland last month. Investors, however, had remained hopeful of a breakthrough following last week’s call between Trump and China’s Xi.

China’s mineral dominance

China is the undisputed leader of the critical minerals supply chain, producing roughly 60% of the world’s supply of rare earths and processing almost 90%, which means it is importing these materials from other countries and processing them.

U.S. officials have previously warned that this dominance poses a strategic challenge amid the pivot to more sustainable energy sources.

Trump’s back-and-forth trade policies have roiled financial markets in recent months, sparking chaos in major ports and pushing global supply chains to the breaking point.

Oil prices popped shortly after Trump’s social media post. International benchmark Brent crude futures with August delivery rose $1 a barrel to $67.87 on the news. The contract was last seen up around 1.8% for the session.

U.S. West Texas Intermediate futures with July delivery, meanwhile, stood 2.2% higher at $66.42.

Trump says China will supply rare earths in 'done' deal

Next, cui bono? Has a cyber attack war broken out. M&S in the UK. Whole foods in the USA. Where next?

Food shortage fears at one of America's biggest grocery chains after huge cyberattack

June 11, 2025

Whole Foods has issued a warning to customers following a cyberattack on its main supplier.

The supplier, United Natural Foods (UNFI), was forced to shut down certain systems after detecting unauthorized activity on its internal networks in recent days.

As a result, Whole Foods has alerted employees about the potential for food shortages at its more than 500 locations across the US, according to an internal memo obtained by TechCrunch.

The Amazon-owned grocery store added that the cyberattack has impacted UNFI's 'ability to select and ship products from their warehouses,' and that this will 'impact our normal delivery schedules and product availability.'

Whole Foods spokesperson Nathan Cimbala said: 'We are working to restock our shelves as quickly as possible and apologize for any inconvenience this may have caused for customers.' 

UNFI said Wednesday that it is slowly restoring its systems, adding that it should increase 'capacity over the coming days.'

United Natural Foods is the largest publicly traded wholesale distributor of 'healthier food options' in the US and Canada, according to its website. 

In May 2024 the company announced an eight-year extension to serve as primary distributor for Amazon-owned Whole Foods.

The memo also provided staff a talking point when dealing with questions from customers, prompting them to only says that UNFI has been experiencing a 'nationwide technology system outage,' according to TechCrunch.

Whole Food shoppers have shared images of their trips to the store, showing that many of the shelves are empty. 

Food shortage fears at one of America's biggest grocery chains after huge cyberattack

In other news, amid the tariff wars, growing global fiat currency unease.

Dollar divorce? Asia’s shift away from the U.S. dollar is picking up pace

Published Wed, Jun 11 2025 2:37 AM EDT

Asia is progressively moving away from the U.S. dollar, as a mix of geopolitical uncertainties, monetary shifts and currency hedging prompt de-dollarization across the region.

Recently, the Association of Southeast Asian Nations, or ASEAN, committed to boosting the use of local currencies in trade and investment as part of its newly released Economic Community Strategic Plan for 2026 to 2030. The plan outlined efforts to reduce shocks associated with exchange rate fluctuations by promoting local currency settlements and strengthening regional payment connectivity.

“Trump’s erratic trade policy decisions and the dollar’s sharp depreciation are probably encouraging a more rapid shift towards other currencies,” said Francesco Pesole, FX strategist at ING.

Although the shift is more pronounced in Asia, the world has also been cutting its reliance on the greenback, with the share of the dollar in global foreign exchange reserves declining from over 70% in 2000 to 57.8% in 2024. More recently, the greenback also saw a steep selloff this year, particularly in April, following uncertainty around U.S. policymaking. Since the start of the year, the dollar index has weakened by over 8%.

While de-dollarization is not exactly a new phenomenon, the narrative has changed. Investors and officials are beginning to recognize that the dollar can and has been used as a leverage — if not overtly weaponized — in trade negotiations. This has led to a reevaluation of predominantly overweight U.S. dollar portfolios, said Mitul Kotecha, Barclays’ head of FX and EM macro strategy in Asia.

“Countries are looking at the fact that the dollar has been, and can be used as a sort of weapon on trade, direct sanctions, etc… That’s been the real change, I think, in the last several months,” he told CNBC.

----Picking up pace

The move away from the dollar is gaining momentum in ASEAN, driven mainly by two forces: people and companies gradually converting their U.S. dollar savings back into local currencies, and large investors hedging foreign investments more actively, according to a recent note by Bank of America.

“De-dollarization in ASEAN is likely to pick up pace, primarily via conversion of FX deposits accumulated since 2022,” the bank’s Asia fixed income and FX strategist Abhay Gupta said.

Beyond ASEAN, the BRICS nations, which include India and China, have also actively developed and peddled their own payment system to bypass traditional systems like SWIFT and reduce dependency on the dollar. China has also been promoting bilateral trade settlements in the yuan.

More

De-dollarization in Asia is picking up speed

Britons ‘hoarding cash amid economic uncertainty and fear of outages’

10 June 2025

Britons are hoarding physical cash amid extreme economic uncertainty and to provide a safety net for possible banking system outages such as the recent one in Spain, according to the Bank of England’s chief cashier.

Victoria Cleland said on Tuesday that UK households were building a cash contingency pot, much as they did during the Covid and cost of living crises.

She said the Bank had tracked a significant increase in the number of banknotes in circulation in recent months, continuing a rising trend since 2022, at a time when the volume of cash transactions has “gone down significantly”.

In comments at the Cash in the UK conference, Cleland said cash hoarding suggested households were responding to a more volatile global backdrop after the pandemic, the war in Ukraine and the trade uncertainty sparked by Donald Trump’s tariffs, Bloomberg reported.

Data collected by the Bank suggests the value of banknotes in circulation has jumped 23% since before the pandemic, even at a time when the use of cash has dropped.

UK Finance data shows cash was used in just over half of all transactions in 2013 but this had collapsed to 12% by 2023 after a 7% year-on-year fall in the use of cash.

However, in the past couple of years high-street banks and building societies have reported a strong rise in demand from customers for cash.

Earlier this year Nationwide said it had seen a 10% increase in ATM withdrawals in 2024 from 2023. Britain’s biggest building society said many of its customers were using cash to help them with weekly budgeting during the period of high inflation.

Consumers in Spain and Portugal also turned to cash to buy goods during the power outage in late April that knocked out bank and payment systems, while cyber-attacks on UK businesses and organisations in recent months have undermined faith in electronic transactions.

“At a time of uncertainty, at a time of crisis, people do move to cash. They want to make sure they have literally got something under the mattress,” Cleland said. “Even in the UK, there will be times where networks are down and you can only be paying in cash.”

Cash began to decline as the favourite form of money in 2014 and by 2017 Bank of England data shows debit cards had overtaken cash as the most frequently used payment method.

The trend began to reverse in 2022 as inflation began to rise after Russia’s invasion of Ukraine.

The refusal of many shops to accept notes and coins have prompted campaigners and politicians to call for a law forcing force retailers to accept them.

Cleland said that consumers want cash “to be there but they’re not necessarily using it”. She added that households in financial difficulties also used it for budgeting, with reports of increased use among those hit hard by high inflation.

Britons ‘hoarding cash amid economic uncertainty and fear of outages’

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.

Citing trade wars, the World Bank sharply downgrades forecast for global economic growth to 2.3%

10 June 2025

President Donald Trump’s trade wars are expected to slash economic growth this year in the United States and around the world, the World Bank forecast Tuesday.

Citing “a substantial rise in trade barriers’’ but without mentioning Trump by name, the 189-country lender predicted that the U.S. economy – the world’s largest – would grow half as fast (1.4%) this year as it did in 2024 (2.8%). That marked a downgrade from the 2.3% U.S. growth it had forecast back for 2025 back in January.

The bank also lopped 0.4 percentage points off its forecast for global growth this year. It now expects the world economy to expand just 2.3% in 2025, down from 2.8% in 2024.

In a forward to the latest version of the twice-yearly Global Economic Prospects report, World Bank chief economist Indermit Gill wrote that the global economy has missed its chance for the “soft landing’’ — slowing enough to tame inflation without generating serious pain — it appeared headed for just six months ago. “The world economy today is once more running into turbulence,” Gill wrote. “Without a swift course correction, the harm to living standards could be deep.’’

America’s economic prospects have been clouded by Trump’s erratic and aggressive trade policies, including 10% taxes — tariffs — on imports from almost every country in the world. These levies drive up costs in the U.S. and invite retaliation from other countries.

The Chinese economy is forecast to see growth slow from 5% in 2024 to 4.5% this year and 4% next. The world’s second-largest economy has been hobbled by the tariffs that Trump has imposed on its exports, by the collapse of its real estate market and by an aging workforce.

The World Bank expects the 20 European countries that share the euro currency to collectively grow just 0.7% this year, down from an already lackluster 0.9% in 2024. Trump’s tariffs are expected to hurt European exports. And the unpredictable way he rolls them out — announcing them, suspending them, coming up with new ones — has created uncertainty that discourages business investment.

India is once again expected to the be world’s fastest-growing major economy, expanding at a 6.3% clip this year. But that’s down from 6.5% in 2024 and from the 6.7% the bank had forecast for 2025 in January. In Japan, economic growth is expected to accelerate this year – but only from 0.2% in 2024 to a sluggish 0.7% this year, well short of the 1.2% the World Bank had forecast in January.

The World Bank seeks to reduce poverty and boost living standards by providing grants and low-rate loans to poor economies.

Another multinational organization that seeks to promote global prosperity — the Organization for Economic Cooperation and Development — last week downgraded its forecast for the U.S. and global economies.

Citing trade wars, the World Bank sharply downgrades forecast for global economic growth to 2.3%

Covid-19 Corner

This section will continue only occasionally when something of interest occurs.

Covid-19 claims 6 lives in last 24 hours, active tally breaches 7,000 mark

11 June 2025

Covid-19 cases in India continued to witness a gradual uptick, with 306 fresh infections being reported from across the country in the past 24 hours and active tally surging to 7,121, according to official data shared by the Union Health Ministry on Wednesday. 6 deaths, one in Maharashtra, 3 in Kerala and 2 in Karnataka, were also reported during the same period.

Kerala reported the highest single-day jump with 170 new Covid cases, pushing its active tally to 2,223, followed by Gujarat with 114 fresh infections and 1,223 active cases. Meanwhile, Karnataka logged 100 new cases and a total of 459 active infections, the data stated.

Delhi logged 66 infections in the last 24 hours and the city's total caseload reached 757, the Health Ministry said.

An 87-year-old female, along with two males (69, 78), all battling comorbidities, died of Covid-19 in Kerala. A 51-year-old woman with hypertension, Type 2 diabetes and a 79-year-old man with hypertension succumbed to the infections.

In Maharashtra, a 43-year-old male with breathlessness, abdominal pain, distress, tachycardia and cyanosis died due to Covid, officials said.

Jharkhand reported its first Covid death on Tuesday (June 10) as a 44-year-old man, who had tested positive for the infection, died in the state capital Ranchi, officials said. He was undergoing treatment at the Rajendra Institute of Medical Sciences (RIMS) in the capital city.

---- Amid a spike in Covid cases, the Centre has launched nationwide mock drills to assess hospital preparedness and directed states to ensure adequate oxygen supply, isolation beds, ventilators, and essential drugs. Officials have claimed that most cases are mild and managed under home care.

Technical review meetings were held on June 2 and 3, led by Dr Sunita Sharma, Director General of Health Services, to assess the Covid-19 situation and review the country's preparedness measures.

Covid-19 claims 6 lives in last 24 hours, active tally breaches 7,000 mark

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.

Radical electric motor runs without metal coils

June 10, 2025

Scientists at the Korea Institute of Science and Technology (KIST) have developed a new class of lightweight, highly conductive carbon nanotube (CNT) wiring that does away with copper and aluminum entirely. Using a process called Lyotropic Liquid Crystal-Assisted Surface Texturing (LAST), they've created core-sheath composite electric cables (CSCEC) that don't just conduct electricity, but are flexible and, most importantly, are super lightweight.

Each CSCEC wire was only about 0.3 mm thick, including the insulation. A ~256-μm conductor core with a 10-μm sheath to be specific. That's about a thick as a business card, but still capable of powering a spinning motor.

So far, these CSCECs have been good enough to replace all the copper in a small electric CNT-based motor powering a model car.

"By developing a new concept of CNT high-quality technology that has never existed before, we were able to maximize the electrical performance of CNT coils to drive electric motors without metal," said Dr. Dae-Yoon Kim of KIST.

The trick was the LAST process. Using lyotropic liquid crystals – a phase of matter that flows like a liquid but still has some directional order like a crystal – helps align and separate otherwise clumped together individual carbon nanotubes. Combined with a chemical rinse, the process also removes metal catalyst impurities created during manufacturing while maintaining the critical one-dimensional nanostructure that makes CNTs so special.

The LAST procedure boosts conductivity by over 130%, drops a ton of weight, and keeps the performance of the CSCECs stable over time.

When it comes to efficiency, battery life, range, and every other metric to go further, faster, higher, etc, weight matters.

Traditional electric motors, while generally significantly lighter than their ICE counterparts, are still relatively heavy. A fair amount of that weight can be attributed to the copper windings in the stators – not to mention all the associated copper wiring in a vehicle's harnesses.

KIST's recent developments speak to electric motors specifically, but one would hope this technology might be applied to general electrical wiring as well.

Take BEV (battery electric vehicle) cars for example: A dual-motor Tesla Model S front motor weighs about 70  lb (31.8 kg), while the rear is about 80 lb (36.3 kg). About 25% of that motor weight is copper windings. If replaced with CSCEC wiring, it could bring the overall weight of the front and rear motor down from 150 lb (68 kg) to ~115 lb (52.2 kg).

It might not seem like a huge amount on a car that already weighs 4,561 lb (2,069 kg), but you also have to take into account the lower inertia. Less rotating mass means potentially a faster spin-up, better throttle response, more efficient torque delivery and lower mechanical losses. Thermal load would also be lower, so now the cooling system can be made smaller and lighter. It's a cascading effect that only leads to better battery life and longer range.

More

Metal-free motor: CNT cables take on copper's weight and cost

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

World Debt Clocks (usdebtclock.org)

Any fool can criticize, condemn and complain - and most fools do.

Benjamin Franklin

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