London Irvine Report: Special Update 12/07/2025 Stocks Dip. A US Treasury Tariff Gain. AI 171.

Baltic Dry Index. 1663 +198 Brent Crude 70.36

Spot Gold 3356 U S 2 Year Yield 3.90 +0.04

US Federal Debt. 37.092 trillion

US GDP 30.129 trillion

Three great forces rule the world: stupidity, fear and greed.

Albert Einstein

Not much need for my input this morning. Stocks dipped due to rising tariff tensions.

The US Treasury got a tariff boost in June but:

With government red ink swelling throughout the year, last month saw a surplus of just over $27 billion, following a $316 billion deficit in May.

That brought the fiscal year-to-date deficit to $1.34 trillion, up 5% from a year ago. However, with calendar adjustment, the deficit actually edged lower by 1%. There are three months left in the current fiscal year, which ends Sept. 30.

The preliminary report into the Air India 171 crash last month raises questions as to why the engines were turned off.

Dow falls 280 points, S&P logs weekly loss as Trump trade war escalates

Updated Fri, Jul 11 2025 4:26 PM EDT

Stocks closed lower Friday, a day after the S&P 500 posted a new record high and President Donald Trump announced a 35% tariff on Canada and threatened higher tariffs across the board.

The Dow Jones Industrial Average lost 279.13 points, or 0.63%, to close at 44,371.51. The S&P 500 slid 0.33% to end at 6,259.75, and the Nasdaq Composite ended the day 0.22% lower at 20,585.53.

Friday’s losses, driven by an escalation in the trade war, came after all three major averages rose during Thursday’s session.

After Thursday’s market close, Trump cited fentanyl as a reason for higher Canada duties, adding that they would go higher if the country retaliates. “If Canada works with me to stop the flow of Fentanyl, we will, perhaps, consider an adjustment to this letter,” Trump said in a letter posted on Truth Social.

Trump then told NBC News he was planning blanket tariffs of 15% to 20% on remaining countries, higher than the current 10% standard that investors had grown comfortable with.

“I think the tariffs have been very well-received. The stock market hit a new high today,” Trump told NBC News on Thursday.

The S&P gained 0.3% on Thursday to notch a new record, while the tech-focused Nasdaq finished higher by 0.1% as investors shrugged off any worries around the latest trade developments, including a 50% U.S. tariff on imported copper as well as a 50% tariff on Brazil unveiled this week.

However, on Friday, traders waited for an update from Trump on the European Union tariffs, but none came during market hours. It’s not clear whether the president will post a letter with a new rate like he did with Canada or simply give an update on progress of ongoing deal talks.

Friday’s losses pushed the major averages into the red for the week. The Dow Jones Industrial Average ended the week with a 1% decline, while the S&P and Nasdaq notched respective losses of 0.3% and 0.1%.

“This has been a week thus far where the rising rhetoric around trade didn’t adversely affect markets. Investors were able to look through that to a certain extent, but the order of magnitude with one of our most important trade partners that just got dumped in our laps overnight was an eye opener,” said Art Hogan, chief market strategist at B. Riley Wealth Management.

Next week, investors will need to navigate the start of second-quarter earnings reporting season, along with the release of some key inflation data.

Stock market news for July 11, 2025

Treasury posts unexpected surplus in June as tariff receipts surge

Published Fri, Jul 11 2025 2:00 PM EDT Updated Fri, Jul 11 2025 2:54 PM EDT

The U.S. government posted a surplus in June as tariffs gave an extra bump to a sharp increase in receipts, the Treasury Department said Friday.

With government red ink swelling throughout the year, last month saw a surplus of just over $27 billion, following a $316 billion deficit in May.

A 13% increase in receipts from the same month a year ago helped bridge the gap, with outlays down 7%. For the year, receipts are up 7% while spending has risen 6%.

The government last posted a June surplus in 2017, during President Donald Trump’s first term.

Increasing tariff collections are helping shore up the government finances.

Customs duties totaled about $27 billion for the month, up from $23 billion in May and 301% higher than June 2024. On an annual basis, tariff collections have totaled $113 billion, or 86% more than a year ago.

Trump levied across-the-board 10% tariffs on imports in April on top of other select duties. He also announced a menu of so-called reciprocal tariffs on various U.S. trading partners and has been in negotiations since.

The Treasury Department noted that the month benefited from calendar adjustments, without which the deficit would have been $70 billion.

Persistently high Treasury yields again posed a challenge for federal finances.

Net interest on the $36 trillion national debt totaled $84 billion in June, down slightly from May but still higher than any other category with the exception of Social Security. For the year, net interest — what Treasury pays on the debt it issues minus what it earns on investments — is at $749 billion. Total interest payments are projected at $1.2 trillion for the full fiscal year.

Trump has been pushing the Federal Reserve to cut short-term rates to help with the financing burden of servicing federal debt. But markets don’t expect the central bank to ease again until September, and Fed Chair Jerome Powell has said he remains leery of the potential impact that tariffs might have on inflation.

Trump’s own “big beautiful” spending bill that made its way through Congress earlier this month is expected to add about $3.4 trillion to the national debt over the next decade, according to the nonpartisan Congressional Budget Office’s projections.

Treasury posts unexpected surplus in June as tariff receipts surge

In other news, a mystery. One of the pilots turned off the fuel to the engines. Well if they say so.

Engine fuel switches cut off before Air India crash that killed 260, preliminary report finds

12 July 2025

Fuel to the engines of the Air India plane that crashed and killed 260 people last month appears to have cut off seconds after the flight took off, a preliminary report has found.

Air India flight AI171 crashed into a densely populated residential area in Ahmedabad on 12 June, killing 241 passengers and 19 others on the ground. It was the deadliest air crash in a decade.

The Boeing 787-8 Dreamliner had been bound for London.

Under international aviation rules, the investigating state must file an initial report with any findings within 30 days of an air crash.

The report by India’s Aircraft Accident Investigation Bureau found that switches in the cockpit that controlled fuel moved to a “cutoff” position and suggested that Boeing and engine maker GE had no apparent responsibility for the accident.

It said: “The aircraft achieved the maximum recorded airspeed of 180 knots IAS [indicated airspeed] at about 08:08:42 UTC and immediately thereafter, the engine 1 and engine 2 fuel cutoff switches transitioned from RUN to CUTOFF position one after another with a time gap of 1 second.

“The engine N1 and N2 began to decrease from their takeoff values as the fuel supply to the engines was cut off.”

The aircraft started to lose altitude before crossing the airport perimeter wall, it added.

One pilot can be heard on the cockpit voice recorder asking the other why he cut off the fuel. “The other pilot responded that he did not do so,” the report said.

It did not identify which remarks were made by the flight’s captain and which by the first officer, nor which pilot transmitted “mayday, mayday, mayday” just before the crash on 12 June.

The commanding pilot of the Air India plane was Sumeet Sabharwal, 56, who had a total flying experience of 15,638 hours and, according to the Indian government, was also an Air India instructor. His co-pilot was Clive Kunder, 32, who had 3,403 hours of total experience.

The preliminary findings do not say how the switch could have flipped to the cutoff position.

A US aviation safety expert, John Cox, said a pilot would not be able to accidentally move the fuel switches that feed the engines. “You can’t bump them and they move,” he said.

Flipping to cutoff almost immediately cuts the engines. It is most often used to turn engines off once a plane has arrived at its airport gate and in certain emergency situations, such as an engine fire. The report does not indicate there was any emergency requiring an engine cutoff.

“If they were moved because of a pilot, why?” asked US aviation safety expert Anthony Brickhouse.

The switches flipped a second apart, the report said, roughly the time it would take to shift one and then the other, according to US aviation expert John Nance. He added that a pilot would normally never turn the switches off in flight, especially as the plane is starting to climb.

One section of the report explained how one of the engines was able to restart after transitioning to cutoff, but could not reverse the plane’s deceleration.

Engine 1’s core deceleration stopped, reversed and started to progress to recovery, the report says, while engine 2 was able to relight but “could not arrest core speed deceleration”.

Air India acknowledged the report in a statement. The carrier said it was cooperating with Indian authorities but declined further comment.

Engine fuel switches cut off before Air India crash that killed 260, preliminary report finds

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.

UK economy contracts 0.1 per cent in blow to Rachel Reeves

Updated: Friday 11 July 2025 7:29 am

Rachel Reeves’ waning growth agenda has been dealt another blow after the UK economy contracted 0.1 per cent in May.

The Chancellor has endured a bruising few weeks after government U-turns and spending splurges have cut into the fiscal headroom she outlined in the Autumn.

Fresh figures from the Office for National Statistics have confirmed her growth mission was still lagging.

May’s results fall short of City economists’ expectations of 0.1 per cent growth.

Production marked the steepest drop at 0.9 per cent and construction shrunk 0.6 per cent. Meanwhile services grew just 0.1 per cent.

Liz McKeown, director of economic statistics at the ONS, said: “The economy contracted slightly in May with notable falls in production and construction only partly offset by growth in services.”

“May’s fall in production was driven by oil and gas extraction, car manufacturing and the often-erratic pharmaceutical industry.”

Responding to the figures, Andrew Griffith, Shadow Business Secretary said: “This month’s data shows a clear pattern with business output down, our trade balance worse and the economy shrinking.

“Try as she might, the Chancellor only has herself to blame. This socialist government doesn’t understand business but must urgently listen to those who do and reverse their onslaught of tax and regulations.”

This follows figures from April, which showed the economy contracted 0.3 per cent during the month, compared to growth of 0.7 per cent in the first quarter.

Reeves’ £20bn tax grab on employers came into effect at the beginning of April and has been blamed for falling headcounts and a row back on hiring amid higher costs for businesses.

Paul Dales, chief UK economist at Capital Economics, said May’s decline, along with April, “continued to reverse some of the 0.7 per cent quarterly leap in GDP in the first quarter.”

Dales added: “We think GDP will rise by a fairly subdued one per cent this year due to the lingering drags from a weakening global economy and the rises in domestic taxes for UK businesses.”

The dire growth figures and Chancellor’s £190bn splurge in the government’s Spending Review have spiked concerns for a tax-heavy Autumn Budget.

UK economy contracts 0.1 per cent in blow to Rachel Reeves

Technology Update.

With events happening fast in the development of solar power and graphene, I’ve added this section.

Approx. 5 minutes.

EV Charging Stations: An Accident Waiting to Happen

EV Charging Stations: An Accident Waiting to Happen - YouTube

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

World Debt Clocks (usdebtclock.org)

Exponent Calculator

Enter values into any two of the input fields to solve for the third.

Exponent Calculator