Baltic Dry Index. 1436 +02 Brent Crude 68.07
Spot Gold 3310 US 2 Year Yield 3.88 Thurs.
US Federal Debt. 37.071 trillion
US GDP 30.119 trillion.
Once the dollar begins to collapse beneath the weight of all this new deficit spending, accumulation of contingency liabilities and the socialization of our economy, commodity prices and interest rates will head skyward.
Peter Schiff
It is tariff week, even as US President Trump delays, yet again, the start date to August 1.
Doubling down on his Armageddon trade policy, President Trump has now declared trade war Mutual Assured Destruction on the rest of the world, increasingly trying to defend itself from a dollar reserve currency now committing suicide.
With US federal debt already 123 percent of US GDP and headed to 150 percent of US GDP by 2035, assuming no global recession or US war by 2035, the rest of the world has no other option but to reduce its exposure to the now failing fiat dollar reserve standard.
Get some physical gold and silver held out of the larcenous clutches of Uncle Sam.
How did the Great Nixonian Error of Fiat Money, dollar reserve standard fail, gradually then suddenly, with apologies to Earnest Hemmingway. We are currently between gradually and suddenly, but with President Trump now going all in for suddenly.
Asia-Pacific markets mixed after Trump shifts
goalposts on tariffs again
Updated Mon, Jul 7 2025 11:20 PM EDT
Asia-Pacific markets traded
mixed on Monday after U.S. President Donald Trump confirmed that
“reciprocal” tariffs, first announced in April, will take effect
on Aug. 1 for countries that haven’t struck a deal.
Trump added in a separate announcement
Sunday that an additional
10% tariff would be charged to countries “aligning themselves with the
anti-American policies of BRICS” without elaborating. His announcement came as
the BRICS bloc of developing countries gathered in Rio de Janeiro, Brazil, for
a two-day summit.
Earlier on Sunday, Treasury Secretary
Scott Bessent said that tariffs
introduced in April will be enforced starting August 1 for countries
that haven’t finalized an agreement with the Trump administration. While
Bessent dismissed the notion that August 1 represents a fresh deadline, he
acknowledged that the new date could allow trading partners additional time to
renegotiate tariff terms.
Japan’s benchmark Nikkei 225 slipped 0.53%
while the Topix declined 0.57%. South Korea’s Kospi added 0.19% and the
small-cap Kosdaq rose 0.16%.
Australia’s S&P/ASX 200 slid 0.11%.
Hong Kong’s Hang Seng index lost
0.61%, and mainland China’s CSI 300 dipped 0.12%.
The Reserve Bank of Australia kicks start
its two-day meeting, where it is widely expected to cut rates by 25 basis
points to 3.60%.
U.S. stock futures fell after Trump
confirmed that tariffs are set to go into effect Aug. 1, not July 9. Dow Jones
Industrial Average futures slid by 146 points, or 0.32%. S&P 500 futures
and Nasdaq 100 futures dipped 0.39% and 0.42%, respectively.
Last Friday stateside, the three major
averages closed higher. The S&P
500 and Dow Jones
Industrial Average powered to new highs and capped off a winning week
as banking behemoths ushered in a promising start to the third-quarter earnings
season. The Nasdaq Composite added
0.33% to finish at 18,342.94 and less than 2% below its all-time high.
Asia
stock markets today: live updates
Trump threatens extra 10% tariff on countries that
align with ‘Anti-American’ BRICS policies
Published Sun, Jul 6 2025 10:52 PM EDT
U.S. President Donald Trump has threatened
an additional 10% tariff on countries that orient themselves along the
“Anti-American policies of BRICS.”
Trump’s announcement, which did not
elaborate on any specific policy of BRICS, came as the group’s meeting is
underway in Rio de Janeiro, Brazil.
The bloc’s leaders took aim at Trump’s
sweeping tariff policies in a joint statement dated July 6, warning against
“unjustified unilateral protectionist measures, including the indiscriminate
increase of reciprocal tariffs.”
Without calling out the U.S., the leaders
voiced “serious concerns about the rise of unilateral tariff and non-tariff
measures which distort trade and are inconsistent with WTO rules,” warning that
the “proliferation of trade-restrictive actions” threaten to disrupt the global
economy and worsen the existing economic disparities.
“Any Country aligning themselves with the
Anti-American policies of BRICS, will be charged an ADDITIONAL 10% Tariff.
There will be no exceptions to this policy,” Trump said in a post on Truth
Social Sunday evening stateside.
The BRICS group of developing nations also
offered symbolic backing to fellow member, Iran, condemning a series of
military strikes on the country, without naming Israel or the U.S which carried
out the military operation.
BRICS includes Brazil, Russia, India,
China, South Africa, Saudi Arabia, Egypt, United Arab Emirates, Ethiopia,
Indonesia and Iran. The bloc describes itself as “a political and diplomatic
coordination forum for countries from the Global South and for coordination in
the most diverse areas.”
This year, Chinese President Xi Jinping
sent Premier Li Qiang to the meeting in his absence, while Russian President
Vladimir Putin, who faces an arrest warrant from the International Criminal
Court, attended online.
BRICS goals include improving economic,
political and social cooperation among its members, and “increasing the
influence of Global South countries in international governance.”
The bloc seeks to challenge
Western-dominated institutions of global economic governance, as well as to
supplant the U.S. dollar’s role in the global economy, according to the Carnegie Endowment for International Peace.
Separately, Trump confirmed that the U.S.
will start delivering letters on Monday, detailing country-specific tariff
rates and any agreements reached with various trading partners. That affirmed
Treasury Secretary Scott Bessent’s comments over the weekend.
The Trump administration has said that
tariffs announced in April will take effect on Aug. 1, instead of July 9, for
countries that have not reached an agreement with the U.S.
Bessent rejected the idea that Aug. 1 was
yet another new tariff deadline. “We are saying this is when it’s happening, if
you want to speed things up, have at it, if you want to go back to the old rate
that’s your choice,” Bessent said Sunday on CNN’s “State of the Union.”
In April, Trump announced a 90-day pause
on the steep tariffs he had unveiled
just days prior on most trading partners. That pause is due to expire
on Wednesday, sparking concern among investors and U.S. trading
partners.
Trump says countries aligning with BRICS bloc will face extra 10% tariff
In solar news, Solar cycle 25 was expected to peak this year 2025, but seems to have peaked early in August 2024. We are now headed down towards the solar cycle minimum around 2028-2029 or so.
My guess, colder winters in both hemispheres, starting with this winter in the southern hemisphere, i.e. right now. In the northern hemisphere, starting in winter 2025-2026 and on out towards winters 2028-2030.
Sun news: Solar Cycle 25 update
July 4, 2025
Sun news July 4: Solar Cycle 25 update
(11 UTC to 11 UTC)
Today’s top story: NOAA just
released sunspot number results for June 2025. The results show a monthly
sunspot number of 116.3 for June. That means August 2024 continues as the peak
of the current solar cycle, Cycle 25. August 2024 had a monthly sunspot
number of 216. June’s value did increase, however, in contrast to May 2025
(monthly sunspot number of 79). What does it all mean? It means we are still in
solar maximum – the peak of our star’s 11-year cycle of activity – until
officials declare it ended. Note that solar maximum typically extends a year or
two beyond the peak sunspot number!
- Flare
activity continued low over
the past day. In the past 24 hours, the sun produced only three flares,
two Cs and
one B. That’s in
contrast to 11 flares produced the day before. The largest flare of the
past day was a C2.5 at 7:47
UTC on
July 4, from active region AR4130. The leading flare producer of the
period was AR4130 with two C flares, including the day’s largest.
- Currently,
the sun has seven sunspot regions on its Earth-facing side.
Sunspot region AR4129 lost its gamma configuration and today shows a
simpler beta
magnetic configuration. The rest of the active regions on the solar
disk show simple alpha or beta configurations.
- Blasts
from the sun? No
Earth-bound coronal mass ejections (CMEs) were
observed in available coronagraph imagery over the past day. The pair of
prominences we saw yesterday are not coming to us at Earth but the one on
the northwest will hit Venus on July 4.
More
Sun news: Solar
Cycle 25 update
Solar cycle
In other news, an excerpt from John Mauldin’s
ever prescient excellent weekly newsletter.
At The Crossroads
John Mauldin July 4, 2025
The economy’s direction will be determined
largely by the way businesses respond to the new tariffs and other policies. A
May survey by the Dallas Fed gives us some preliminary answers. Both
manufacturing and service firms were asked what actions they are taking in
response to higher tariffs. They could choose multiple answers.
A big majority (76%) of manufacturers say
they are passing on at least some cost increases to customers. That’s
inflationary. Some 50% say they are “absorbing cost increases internally.” That
probably means some combination of layoffs and lower profit margins, which are
more recessionary. Put them together and yes, stagflation is a risk. But we’re
not there yet.
By the way, notice something else in this
survey data. The stated goal of all these changes is to bring manufacturing and
jobs that went overseas back to the US. There’s little sign this will
happen. Only 37% of manufacturers say they are looking for new domestic
suppliers. Only 11% say they are relocating production to the US. That’s less than
the 17% who say they want to find new foreign suppliers.
I share the goal of wanting to make the US
less dependent on China. Everything I see says the tariffs aren’t going to
accomplish that goal. I realize many people think otherwise. They are operating
on hope, not evidence. The evidence we have says the tariffs are harming the
economy while, at least so far, delivering few benefits. Tariffs are a tax on
consumers. They do raise some much-needed revenue, but not enough to cut
deficits all that much.
At The Crossroads
- Mauldin Economics
What have tariffs really done to the US economy?
Updated 4 July 2025
Soon after Donald Trump returned to the
White House in January, he began raising tariffs, brushing off warnings from
economists and businesses about the risks of economic damage.
He started with Mexico, Canada and China,
then targeted steel, aluminium and cars, and finally in April, on what he
called "Liberation Day", unleashed a blitz of new taxes on goods from
countries around the world.
The plans hit trade and roiled financial
markets. But as worries mounted, Trump quickly suspended his most aggressive
plans to allow for 90 days of talks.
As that 9 July deadline approaches and the
president crafts his approach, he will have one eye on the US economy.
So what has the impact really been?
The stock market has rebounded
Trump's plans included tariffs of 20% on
goods from the European Union, punishing tariffs on items from China of 145%,
and a 46% levy on imports from Vietnam, though on Wednesday he announced a deal
that will see the US charge tariffs of 20% on Vietnam.
The US stock market suffered the most
immediate hit, starting to slide in February and finally tanking in April after
Trump unveiled the full scope of his plans, on so-called "Liberation
Day".
The S&P 500, which tracks 500 of the
biggest companies in the US, dropped about 12% over the course of a week.
But shares bounced back after Trump rolled
back his plans, abandoning steep tariffs in favour of a more easily swallowed
10% rate instead.
Now, the S&P 500 index is up about 6%
for the year. In the UK and Europe, shares have also rebounded.
But shares of tariff-vulnerable firms,
such as retailers and car companies are still hurting - and there is more risk
ahead, as the talks deadline approaches.
The White House has left its options open,
saying both that the deadline is "not critical" and that the
president may simply present other countries "with a deal" on that
date.
Liz Ann Sonders, chief investment
strategist at Charles Schwab, said the rebound suggested "a lot of
complacency" among investors, who risk being spooked again should Trump
revive higher tariffs than they expect.
Trade is at a crossroads
Trump's tariffs precipitated a rush of
goods to the US in the early part of the year, followed by a sharp drop in
April and May.
But zoom out a bit, and US goods imports
in the first five months of the year were up 17% compared with the same period
last year.
What happens in the months ahead will
depend on whether Trump extends his pause - or revives his more aggressive
plans, said Ben Hackett of Hackett Associates, which tracks port traffic for
the National Retail Federation.
"At this point it's anybody's
guess," Mr Hackett said, noting that for now the situation was "in a
holding pattern".
"If the tariff freeze disappears and
the high tariffs are reimposed then almost certainly we're going to have a
short recession," he added.
More
What have tariffs really done to
the US economy? - BBC News
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.
Why some fear government data on the U.S. economy
is losing integrity
July 4, 2025
U.S. policymakers are increasingly anxious
about the integrity of certain government benchmarks, the crucial data points
that help the Federal Reserve assess the economy’s health and guide interest
rate decisions.
The problems have led staff at certain
agencies to rely more on statistical estimates than hard data, potentially
fueling volatility in benchmarks, particularly for inflation readings from the
Labor Department. Falling response rates to government surveys, coupled with
pandemic-driven seasonal quirks and long-standing budget strains, have made it
harder to collect and analyze reliable data — including for an employment
report due Thursday. Agencies have also shed staff through early retirements,
deferred resignations and normal attrition.
Any erosion in the integrity of government
data could complicate policymakers’ view of the economy, which is undergoing
major policy changes from across-the-board
tariff increases to strains in the labor market due
to a loss of immigrants. Last week, Federal Reserve Chair Jerome H. Powell
warned lawmakers he didn’t want to see a decline in U.S. gold-standard
statistics.
“I would not want anyone to think the data
have deteriorated to a point where it’s difficult for us to understand the
economy,” Powell said during congressional testimony. “But the direction of
travel is concerning.”
The Trump administration is also pushing
to overhaul major benchmarks it calls flawed. In March, Commerce Secretary
Howard Lutnick called for a
change in the way economic growth is measured, though that idea has yet to move
forward. At the same time, the president’s budget for the fiscal year that
begins Oct. 1 proposes
slashing the Bureau of Labor Statistics’ roughly $700 million budget by about 8
percent,
a cut economists warn could further hobble the agency.
These challenges could have real-world
consequences beyond Washington. From Wall Street trading floors to Main Street
boardrooms, government benchmarks are vital to businesses, investors and
consumers making decisions about hiring, spending and borrowing.
“The statistical system is under acute
stress at the moment,” said David Wilcox, a senior fellow at the Peterson
Institute for International Economics and the director of U.S. economic
research at Bloomberg Economics. “These data are a critical piece of the social
infrastructure, and they guide decision-making by Washington policymakers,
businesses and households across the country. Without reliable data,
decision-making becomes less well founded.”
The White House defended the integrity of
federal jobs data and credited President Donald Trump’s policies for strong job
growth.
----Economists say recent
developments have only deepened their concerns. Last month, the BLS said it is
surveying fewer outlets for the consumer price index — the most widely used
benchmark for inflation — because of staffing shortages in certain cities. While
officials said that shouldn’t affect the overall CPI, they acknowledged it
could increase volatility in some of its components.
Separately, the BLS had previously said it
would reduce the number of households sampled for a survey that underpins the
official unemployment rate and other labor-market indicators, before walking
back the plan.
Still, other little-noticed changes are
proceeding, such as the bureau’s discontinuing the calculation and publishing
of wholesale pricing data on hundreds of products in the producer price index.
And the Trump administration has disbanded a pair of technical advisory
committees that helped the government develop its data.
More
Why some fear
government data on the U.S. economy is losing integrity
The June Jobs Report: School’s Out…..Not!
david stockman Jul 04, 2025
Once upon a time June was “school’s out”
month and as far as we know it still is. But apparently not by the lights of
the BLS, which reported this morning that state and local school authorities
hired an additional 64,000 teachers and administrators
in June!
In turn, this acute rebuke to normal
seasonality accounted for 44% of the entire ballyhooed gain of 147,000 nonfarm
jobs in June. So once again, we must default to the proposition that the Jobs
Friday reports each month are truly not worth the paper they are printed upon.
More, subscription required.
The June Jobs
Report: School’s Out…..Not!
Hong Kong investors triple gold holdings in rush
to haven asset: HSBC survey
Hong Kong investors allocate 11 per cent
of their portfolios to gold and other precious metals, up from 4 per cent a
year ago
Published: 7:32pm, 3 Jul 2025
Affluent investors in Hong Kong have
nearly tripled their allocation to gold amid economic and geopolitical
uncertainties, according to an HSBC survey.
Individual investors in the city with
US$100,000 to US$2 million in investible assets had allocated 11 per cent of
their portfolios to gold and other precious metals, up from 4 per cent a year
ago, according to the survey published on Thursday. On the mainland, wealthy
investors had increased their gold holdings to 15 per cent compared with 7 per
cent a year earlier.
The trend mirrors that of their global
peers, with their share of investments in gold rising by 6 percentage points to
11 per cent over the past year.
Gold was trading at US$3,356.61 per ounce
on Thursday, up 28 per cent year to date. The precious metal hit an all-time
high of US$3,500 in April. The rally followed sweeping tariffs imposed by US
President Donald Trump against all major trading partners, which sent global
markets tumbling and prompted a rush for haven assets.
In May, central banks around the world
added a total of 20 tonnes to their gold reserves, according to the World Gold
Council. The National Bank of Kazakhstan added seven tonnes, while the People’s
Bank of China added three tonnes.
The gold rush also prompted several
Chinese gold miners to raise funds in Hong Kong amid a surge in initial public
offerings in the city. Shares of Chifeng Jilong Gold Mining, the largest
non-state-owned gold producer in China, have nearly doubled from their offer
price of HK$13.72 since the company’s debut in March.
HSBC surveyed more than 10,000 individual
investors from 12 markets – including the US, the UK, mainland China and Hong
Kong – in March.
Investors globally have reduced their
allocation to cash and cash equivalents – short-term, highly liquid investments
that can easily be converted to cash – to 20 per cent, compared with 33 per
cent a year ago.
More
Covid-19
Corner
This
section will continue only occasionally when something of interest occurs.
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.
Massive
Explosion At Battery Factory In Azuqueca de Henares, Spain, Sparks Fire |
Videos
5 July 2025
A large explosion followed by a fire broke out at a
battery factory in Azuqueca de Henares, Spain. Videos shared on social media
show thick plumes of grey smoke and flames rising from the facility. As of now,
there are no confirmed reports of fatalities or the extent of damage. Emergency
crews are responding to the scene. Updates are expected as the situation
develops.
More, plus videos.
Massive Explosion At Battery Factory In Azuqueca de Henares, Spain,
Sparks Fire | Videos
GWR’s battery trains trials could bring big benefits to small
lines
Published on 2nd July 2025 by Ian Mansfield in Transport News
Fast charging battery-powered trains
took a step closer to running on the railways after a report into west London
trials found they work, and work rather well in fact.
The trials have been carried out
by GWR using a converted old District
line train once owned by Vivarail and fitted with large rechargeable
batteries. The key innovation has been the fast charger, which sits on the
tracks at West Ealing station, allowing the battery to be topped up in the time
it takes for the train to stop for passengers.
Put very simply, when the train arrives,
it drives over the power supply in the tracks, which only switches on when the
train is over it, and then rapidly recharges batteries inside the train.
Obviously — it’s never quite that simple though, hence the tests that have been
running for the past year.
The advantages are that there’s no need
for an expensive and time-consuming electrification of the railway line, so
battery trains could potentially be used to replace diesel trains on lines
where electrification is not economically viable.
Such as short branch lines, of which GWR
is blessed with many, but they use old diesel trains, which are coming to the
end of their lives. If they can replace the old diesel trains with modern
battery-electric trains, there are considerable environmental and financial
benefits to be gained.
No need for all those overhead wires and
concrete foundations for the steel supports and the big steel uprights
themselves. Over a typical 30-year lifespan, GWR says that battery power is
significantly cheaper than full electrification of the railway.
Electric trains are also significantly
quieter than diesel trains. An electric train is about as loud as a normal
human conversation, compared to the equivalent noise from a lorry that a diesel
train makes. Not just a boon for passengers, but also for residents near the
railways.
Over the past year, lots of tests have
been carried out – pushing the battery technology to various limits.
As Julian Fletcher, from GWR’s Innovation Team, explained during
yesterday’s test run, they’ve ranged from asking drivers to drive as if they
had just stolen a car to driving as if their grandmother was in the car. From
running deliberately late to shortening the battery charge time to arriving
early and ensuring things don’t overload.
And they’ve been carrying out loading
trials with lots of weights, or at times, people on board. They’ve tested it in
the cold, the very wet and as yesterday demonstrated, in the very hot.
Although not explicitly related to this
trial, they also redesigned the regenerative braking, which feeds energy back
into the batteries instead of wasting it as heat, to be more efficient. The
energy savings compared to an older train mean their “hotel” energy costs, the
lights etc inside the train are now effectively free of charge.
---- At
the moment, the cost of a diesel train is approximately £2.60 per mile,
compared to 57p per mile for overhead-powered electric trains. Battery trains
cost the same per mile, but avoid the upfront electrification costs, which
average around £4.15 per train mile.
GWR is now working on the assumption
that a fast charger is needed every 100km of railway, at a cost of around £1.3
million. Therefore, the total cost of ownership of a battery train service
would be just £2.52 per train mile.
More
GWR’s battery trains trials could bring big benefits to small lines
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt
Clocks (usdebtclock.org)
Changes
in temperature
While
evidence of modern climate change overwhelmingly points to man-made factors,
such as the production of greenhouse gasses (including carbon dioxide, methane,
and nitrous oxide), there’s some evidence to show the Sun has also influenced
life on Earth in the past.
For
example, in the late 19th century, the British husband-and-wife team of E.W.
and Annie Maunder identified a lack of sunspots between 1645 and 1715. Their
work was published in 1894, with the period now known to astronomers as the
Maunder Minimum.
The
Maunder Minimum was later linked to an unusually cool period that occurred
within the same timeframe.
When
the Sun produces fewer sunspots, it also produces less energy, and this may
have an impact on the Earth’s climate. In the case of the Maunder Minimum, the
average global temperature dropped by about 3.6°F (2.0°C), causing what has
come to be known as “the Little Ice Age.”
What is the 11
Year Cycle of the Sun? | High Point Scientific
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