Baltic
Dry Index. 1893 -34
Brent Crude 67.65
Spot Gold 3328 US 2 Year Yield 3.79 +0.05
US Federal Debt. 37.262 trillion
US GDP 30.216 trillion.
So: if the chronic inflation undergone by Americans, and in almost every other country, is caused by the continuing creation of new money, and if in each country its governmental "Central Bank" (in the United States, the Federal Reserve) is the sole monopoly source and creator of all money, who then is responsible for the blight of inflation? Who except the very institution that is solely empowered to create money, that is, the Fed (and the Bank of England, and the Bank of Italy, and other central banks) itself?
Murray Rothbard
Did another stock bubble just burst?
Will Fed Chair/sofa/pouffe Powell unload on Trump later today?
Whatever the couch of the Fed says later today it’s meaningless if the Great AI bubble is bursting.
Warren Buffett will eventually get to pick up the remnants.
Getting out early always beats getting carried out last.
Asia-Pacific markets trade mixed as investors look
ahead to U.S. Fed chair Powell’s speech
Published Thu, Aug 21 2025 7:43 PM EDT
Asia-Pacific markets traded mixed Friday
as investors await U.S. Federal Reserve Chair Jerome Powell’s speech at the
central bank’s annual economic symposium, which could offer
clues into the path of interest rates.
South Korea’s Kospi jumped 0.66% and the
small-cap Kosdaq was 0.41% higher.
Japan’s benchmark Nikkei 225 slipped 0.18%,
while the Topix rose 0.37%.
The country’s core
inflation rate cooled to 3.1% in July, coming down from 3.3% the month
before. The figure — which strips out costs for fresh food — was higher than
the 3% expected by economists polled by Reuters. Rice inflation eased to 90.7%
in July, following two months of inflation surging past the 100% mark.
Australia’s benchmark S&P/ASX 200 lost
0.3% after the index crossed the 9,000 mark for the first time Thursday.
Mainland China’s CSI 300 jumped 1.18%,
while Hong Kong’s Hang Seng Index added 0.32%.
India’s Nifty 50 slipped 0.52% at the
open.
Overnight stateside, stocks fell broadly
Thursday, with the S&P 500 sliding
for the fifth day in a row.
The broad-market index shed 0.4% and
closed at 6,370.17, while the Nasdaq
Composite slid 0.34% and settled at 21,100.31. The Dow Jones Industrial Average fell
152.81 points, or 0.34%, ending at 44,785.50.
Fed funds futures are pricing in a nearly
74% likelihood of the central bank cutting rates at its next policy gathering
in September, according to CME’s FedWatch tool.
Asia-Pacific markets live: Japan CPI, Nikkei 225, Kospi
CNBC Daily Open: Jackson Hole takes on new
significance amid Trump’s pressure on the Fed
Published Thu, Aug 21 2025 9:14 PM EDT
Jerome Powell, chair of the U.S. Federal
Reserve, will be giving
his keynote address at the annual Jackson Hole, Wyoming, gathering of
central bankers and economists on Friday stateside.
It’ll be one of the most important
speeches by a central bank official — even more so than Powell’s press
conferences after the Fed’s rate-setting meetings — because Jackson Hole gives
Powell an opportunity to lay out the bank’s longer-term economic frameworks,
such as its inflation
targets and how it evaluates employment.
For Powell, it’s doubly significant, since
the keynote address will probably be his last before his term as Fed chair ends in May 2026.
Even though U.S. President Donald Trump
has threatened to evict
him from his seat prior to that date, the Supreme Court earlier this
year indicated that
Fed officials have special protection against presidential firings. (It seems
that being a central banker in the U.S. might be the only way to protect
yourself from layoffs and displacement by artificial intelligence today.)
That said, the Trump administration
doesn’t seem to be relenting its pressure on Fed officials. The Department of
Justice will investigate
Fed Governor Lisa Cook based on a criminal referral by a White House
official, according to a letter obtained by CNBC’s Sara Eisen on Thursday.
In a typical year, Jackson Hole sparks
excitement mostly among market watchers and finance nerds (i.e. yours truly).
This time, the symposium feels more pivotal, almost like a gathering of people
quietly struggling for central bank independence.
What you need to know today
The U.S. and EU announce tariff
details. Automotive
exports to the U.S. will face a 15% tariff — after the EU
introduces legislation to reduce their industrial duties. Pharmaceuticals
will see levies capped
at a maximum of 15%.
Fed Chair Jerome Powell is set to give a
big speech on Friday. At Jackson Hole, a gathering of central bankers to
talk economic policy, Powell is expected to discuss the Fed’s
long-term policy goals — in what will almost certainly be his last
keynote there.
Google scores a $10-billion cloud deal
with Meta. Under
the agreement, Google will
provide Meta cloud
services mainly related to AI over six years, according to two people
familiar with the matter.
Major U.S. indexes had a red
Thursday. The S&P 500 fell 0.4% for
its fifth
losing session in a row. Europe’s regional Stoxx 600 was flat, snapping
a three-day winning streak, as investors shrugged off details of the
EU-U.S. trade agreement.
[PRO] No relief rally for European
pharmaceuticals. Despite U.S. and EU officials announcing that
pharmaceuticals will not be subject to higher tariffs, investors
don’t appear to trust the deal.
CNBC
Daily Open: New significance for Jackson Hole amid Trump's pressure
In other news, easy come easy go.
US tech stocks lose $1 trillion on AI bubble fears
20 August 2025
The US stock market has seen $1 trillion
wiped off in four days as a sell-off in tech companies deepened on Wednesday.
The S&P 500 fell for the fourth
consecutive day on Wednesday amid fears that an AI-powered stock market rally
could be about to collapse.
The tech-heavy Nasdaq fell by as much as
1.8pc in early trading on Wednesday, bringing the index down by as much 7pc so
far this week in its worst sell-off since April.
The Nasdaq has since pared back some of
its losses but was still down by nearly 1pc by Wednesday afternoon.
The drop-off has been fuelled by concerns
that AI companies are overvalued, with some claiming they have little to show
for the billions of pounds of investment that have been ploughed into companies
such as OpenAI.
Shares in Nvidia, the world’s largest
company with a $4 trillion valuation, fell by 3.3pc in early trading on
Wednesday, before recovering slightly.
The technology giant, which makes the
chips that power vast AI data centres, was down 4.9pc since Monday.
Shares in Palantir, the US data business
and defence contractor, also sank by as much as 6pc on Wednesday before
partially recovering. The value of its stock has tumbled by a fifth in six
days.
Shares in American chipmaker Intel plunged
by more than 7pc while UK chipmaker Arm’s share price was down by 3.6pc on
Wednesday.
It comes after a report from researchers
at MIT suggested that 95pc of corporate AI projects are so far generating “zero
return” for businesses.
Danni Hewson, head of financial analysis
at AJ Bell, said: “The MIT report into the AI boom has soured sentiment.”
OpenAI chief executive Sam Altman also
made public remarks last week that some investors had become “overexcited”
about AI.
More
US tech stocks
lose $1 trillion on AI bubble fears
This is the critical detail that could
unravel the AI trade: Nobody is paying for it.
As Big Tech companies spend billions on AI
buildout, their ability to generate cash is starting to take a hit
Published: Aug. 21, 2025 at 3:27 p.m.
ET
Those who bet against the
artificial-intelligence growth story have found themselves missing out on an
epic multiyear rally. But there’s increasing evidence that an AI revolution may
be hitting a cashless brick wall.
While the stock prices of some of the
biggest technology companies have climbed almost straight up since April,
something else is dropping: free cash flow, or the newly generated cash
remaining after the tech behemoths pay their operating expenses and soaring
capital expenditures.
Chasing AI hasn’t been cheap for the big
hyperscalers — the cloud-services providers building out the infrastructure
powering the AI boom. They are investing massively. Alphabet Inc. are
on track to spend nearly $400 billion this year on capital expenditures. It’s a
marked departure from these companies’ previously capex-light business models.
But very few businesses or consumers are
actually paying for AI. So free cash flow has been declining for hyperscalers,
with the exception of Microsoft. For the past two reported quarters, free cash
flow has been negative for Amazon and Oracle, and it has declined for Alphabet
and Meta. That means less cash is available to be returned to shareholders
through stock buybacks or dividends.
So far, Nvidia Corp. has been
the big winner, reaping the benefits of supplying the AI gold rush by selling
the graphics processing units that are housed in the hyperscalers’ data
centers. Demand for GPUs has been so high that Nvidia has been
supply-constrained for years. But at some point, the hyperscalers might be
reluctant to keep burning cash.
Here is how much free cash flow the five
major hyperscalers and Nvidia have generated over their past two reported
fiscal quarters compared with year-earlier periods:
More
This
is the critical detail that could unravel the AI trade: Nobody is paying for
it. - MarketWatch
Nvidia looking to halt H20 chip production after
China cracks down on purchases, reports say
Published Thu, Aug 21 2025 10:45 PM EDT
Nvidia has
asked some of its component suppliers to stop production related to its
made-for-China H20 general processing units, as Beijing cracks down on the
American chip darling, The Information reported Friday.
The directive comes weeks after the
Chinese government told local tech companies to stop buying the chips due to
alleged security concerns, the report said, citing people with knowledge of the
matter.
Nvidia reportedly has asked Arizona-based
Amkor Technology, which handles the advanced packaging of the company’s H20
chips, and South Korea’s Samsung Electronics, which supplies memory for them,
to halt production. Samsung and Amkor did not immediately respond to CNBC’s
request for comment.
A separate report from Reuters, citing
sources, said that Nvidia had asked Foxconn to suspend work related to the
H20s. Foxconn did not immediately respond to a request for comment.
In response to an inquiry from CNBC, an
Nvidia spokesperson said “We constantly manage our supply chain to address
market conditions.”
The news further throws the return of the
H20s to the China market in doubt, after Washington said it would issue export
licenses, allowing the chip’s exports to China — whose shipment had effectively
been banned in April.
Last month, the Cyberspace Administration
of China had summoned Nvidia regarding national security concerns with the H20s
and had asked the company to provide information on the chips.
Beijing has raised
concerns that the chips could be have certain tracking technology or
“backdoors,” allowing them to be operated remotely. U.S. lawmakers have proposed legislation that would require AI chips under
export regulations to be equipped with location-tracking systems to avoid their
illegal shipments.
Speaking to reporters in Taiwan on Friday,
Nvidia CEO Jensen Huang acknowledged that China had asked questions about
security “backdoors,” and that the company had made it clear they do not exist.
“Hopefully the response that we’ve given
to the Chinese government will be sufficient. We’re in discussions with them,”
he said, adding that Nvidia had been “surprised” by the queries.
More
Nvidia
looking to halt H20 chip production after China cracks down on purchases
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.
Moody’s
chief who nailed 2007 housing bust revives recession fears
August
20, 2025
Recession
warnings are everywhere, but Mark Zandi’s hits different.
The
Moody’s chief economist, who flagged the 2007 housing collapse before most
dared calling it a bubble, now sees serious recession risks hiding in plain
sight.
Beneath
the numbers, Zandi is seeing a labor market that’s quietly unraveling,
dissecting undercurrents that the market’s ignoring.
These
typically aren’t the signals investors typically focus on, but for Zandi, these
matter the most given the current setup.
And
when he points below the surface, history says it’s best to listen.
Who
is Moody’s Analytics Chief Economist Mark Zandi?
Mark
Zandi is a popular longtime chief economist at Moody’s Analytics and is perhaps
one of the most quoted names during economic crises.
He
became a regular fixture in Washington during the 2008 financial meltdown,
essentially becoming the “explain-and-forecast” guy for lawmakers and the
media.
In
fact, when the much-talked-about $787 billion stimulus package was being
discussed in early 2009, then-House Speaker Nancy Pelosi cited his research on
multiple occasions in press briefings to build support.
His
models underscored the importance of a stimulus and unemployment benefits to
supercharge the GDP and the job market.
However,
Zandi’s credibility was mostly built in 2006-2007, before the crash. His
now-famous report, Housing
at the Tipping Point,
warned of the remarkably high odds of national housing prices dropping in 2007.
He
called it the first national price drop since the Great Depression. Also, he
flagged more than 100 U.S. metro areas at risk while projecting double-digit
declines that later materialized in multiple key markets.
Moody's
Mark Zandi sees recession risks rising
Moody’s
Analytics Chief Economist Mark Zandi just sounded the alarm on the U.S.
economy, zeroing in on the labor market as the primary weak link.
“Yeah,
I think recession risks are really high,” he said on CNBC’s "Money
Movers." “I think the key here is jobs.”
Zandi
notes the latest job reports have effectively stalled out.
“With
the recent data, we've seen jobs data come to a virtual standstill, and I don't
see any reason why we'll see any pick up here anytime soon.”
Sadly,
the numbers back him exactly what he’s pointing towards. July added just 73,000
jobs, and previous months were quietly revised down by 258,000.
That
puts the three-month average around the 35,000 mark — sluggish speed, to say
the least.
Unemployment’s
stuck at 4.2%,
and quits held at 2.0%, which is a clear sign that workers aren’t feeling bold.
This setup puts the economy perilously close to a downturn.
Perhaps
the real danger he senses is that we start seeing negative prints.
“If
we start getting some negative job numbers, which I think is really very
possible, that would be a clear indication of a recession.”
Typically,
a 0.5-point unemployment bump signals recession. However, with flat immigrant
labor growth at this time, that signal has gotten a lot fuzzier.
Simply
put, fewer jobs equals less spending equals sluggish growth, which makes
payrolls a much sharper recession signal.Zandi feels payroll employment, which
is the monthly change in jobs added or lost, is perhaps a cleaner measure at
this point. If payrolls turn negative, it means businesses are actually cutting
jobs rather than having just a tough time absorbing new workers.
more
Moody’s chief who
nailed 2007 housing bust revives recession fears
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.
Tongwei achieves 31.4% efficiency for perovskite-silicon tandem
solar cell
Chinese
researchers, led by a research team from PV Technology Centre of Tongwei Co.,
Ltd, used a sequential annealing process in the fabrication of tandem solar
cells, featuring a wide bandgap perovskite top cell on a fully-textured
commercial crystalline silicon heterojunction bottom cell. The resulting device
had a certified power conversion efficiency of 31.4%, outperforming a
29.43%-efficient control cell.
August 20, 2025 Valerie Thompson
Scientists in China, led by a research
team from the PV Technology Centre of Tongwei Co., Ltd, a unit of Chinese vertically integrated solar
manufacturer Tongwei,
used a lower temperature, sequential annealing process to fabricate
two-terminal, tandem solar cells that had a wide-bandgap (1.73 eV) perovskite
top cell on a fully-textured commercial crystalline silicon heterojunction
(SHJ) bottom cell.
“With a carefully modulated sequential
annealing process in ambient, we obtain high-quality wide-bandgap perovskite
films conformally grown on fully textured silicon substrates with reduced
defects and homogeneous composition distribution, enabling the achievement of
perovskite-silicon tandems with a certified power conversion efficiency (PCE)
of 31.4%, which is among the best-performing tandem devices utilizing
commercial silicon sub-cells,” Yuchao Hu, corresponding author of the research,
told pv magazine.
The champion tandem device was certified
by the National Institute of Measurement and Testing Technology (NIMTT) and by
the Fujian Institute of Metrology (FJIM).
The research is described in “Crystallization Modulation of Wide-Bandgap Perovskites on Textured
Silicon for Tandem Solar Cells,”
published in ACS Energy Letters.
Aware of the challenges of using a
conventional evaporation-solution two-step method to form wide-bandgap
perovskites on commercial SHJ silicon bottom cells, the research team
investigated ways to overcome moisture and thermal-induced complex effects on the
crystallisation and degradation of perovskite films.
The team investigated the perovskite
phase transition process to reveal the crystallisation kinetics mechanism of
wide-bandgap perovskites, “clarifying the influence mechanisms of external
conditions,” such as humidity and heat on film crystallization.
“To overcome the complex issue, we
developed a sequential crystallisation strategy and realised fine modulations
on both the organic halide diffusion and perovskite recrystallization
processes. This innovative strategy enabled the fabrication of conformally
grown high-quality wide-bandgap perovskite films featuring chemically
homogeneous components and reduced defects on silicon cells with large
pyramids,” specified Hu.
It is a strategy that has industrial
transfer potential. “The annealing process requires temperatures as low as
100-150 C and durations under half an hour,” said Hu, explaining that such
conditions are “readily achievable” with established industrial annealing
equipment, such as tunnel furnaces, “demonstrating strong potential for process
scale-up.”
The perovskite material for the top cell
was made of formamidinium iodide (FAI), formamidinium bromide (FABr), cesium
bromide (CsBr), plus additives.
More
Tongwei achieves 31.4% efficiency for perovskite-silicon tandem solar
cell – pv magazine Australia
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt
Clocks (usdebtclock.org)
Another weekend and the end of summer in the northern
hemisphere fast approaches. Normally the summer harvest season brings lower food
prices, but that doesn’t seem to be happening this year due to northern
hemisphere weather. Will Trump's tariff wars and food price inflation tip the
global economy into recession? Hope for the best but prepare for the worst.
Have a great weekend everyone.
Whether
the weather be fine, or whether the weather be not,
Whether the weather be cold, or whether the weather be hot,
We'll weather the weather, whatever the weather,
Whether we like it or not.
Anon.
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