Baltic
Dry Index. 1979 +16
Brent Crude 66.27
Spot Gold 3581 US 2 Year Yield 3.51 -0.08
US Federal Debt. 37.453 trillion
US GDP 30.252 trillion.
The man who is a pessimist before forty-eight knows too much; if he is an optimist after it, he knows too little.
Mark Twain.
It is US inflation data week, with the latest PPI and CPI figures released. Will the Trump tariffs start showing up in either figures?
If tariff inflation starts appearing, given last week’s US poor jobs report, will it be the start of a US bout of stagflation?
Japanese stocks jump as Prime Minister Ishiba set to step down
Published Sun, Sep 7 2025 7:41 PM EDT
Asia-Pacific markets traded mostly higher
Monday as investors assessed Japan Prime Minister Shigeru Ishiba’s resignation
announcement over the weekend, and eyed key economic data in the region.
Japan’s benchmark Nikkei 225 rose 1.5%
following the prime minister’s statement, which came after weeks of mounting
pressure over his national election defeat late last year. The Topix climbed 1%
to a record high.
Koizumi Shinjiro, the agricultural
minister and son of a former prime minister, is a likely contender to take the
helm, Stefan Angrick, head of Japan and frontier markets economics at Moody’s
Analytics wrote in a Monday note. Meanwhile, Takaichi Sanae, protege of the
late Prime Minister Abe Shinzo and a runner-up in last year’s party contest, is
also a key contender.
Richard Kaye, portfolio manager at
Comgest, said that the market’s “very positive response” Monday was “a little
bit of surprise”, but it’s “reflective of the excitement surrounding Koizumi
and Takaichi.”
Kaye pointed out that potential successor
Takaichi, who is keen on deregulation and not keen on interest rate hikes, is
“likely the candidate to drive growth and she will justify today’s market
rally.”
The Japanese yen weakened 0.64% to 148.33
against the greenback, while Japanese bonds continued to sell off.
Japan’s 30-year bond yield rose over 4
basis points to 3.272% after notching a record high last Wednesday, having
surged more than 100 basis points this year. The yield on the 20-year debt is
over 3 basis points higher at 2.676%.
Japanese government bond yields have
been notching
fresh highs as investors price in persistent inflation, tighter
monetary policy, as well as fiscal uncertainty.
“Japan is now set for a period of extended
uncertainty going into Q4 2025,” wrote analysts from BMI, a unit of Fitch
Solutions. “Although the next LDP leader would ordinarily automatically become
prime minister, it is theoretically possible for the opposition to band
together under a rival candidate for the premiership.”
South Korea’s Kospi was 0.15% higher,
while the small-cap Kosdaq jumped 0.47%.
Hong Kong’s Hang Seng index rose
0.23%, while the mainland’s CSI 300 slid 0.3% after China’s August
exports climbed
4.4% in U.S. dollar terms from a year earlier,
missing Reuters-polled economists’ estimates for a 5.0% rise. Imports
also grew less than expected due to the persistent real estate slump, rising
job insecurity, among other factors.
Australia’s benchmark S&P/ASX 200 lost
0.38%.
Oil prices inched higher after OPEC+
announced over the weekend it will
lift oil production again starting in October, though the group is slowing
the pace of hikes. In an online meeting Sunday, eight OPEC+ members agreed to
lift production by 137,000 barrels a day starting in October, far below the
increases of around 555,000 bpd in September and August, and 411,000 bpd in
July and June.
Global benchmark Brent added
0.53% to $62.2 a barrel, while U.S. West Texas Intermediate futures
traded 0.6% higher at $65.89 per barrel.
U.S. stock futures were little changed on
Sunday as investors gear up for a data-heavy week that includes two closely
watched readings on inflation. The producer price index report for August is
due out Wednesday morning stateside, followed by the consumer price index on
Thursday.
Last Friday in the U.S., all three major
averages closed lower after a weaker-than-expected jobs report gave way to
worries about a slowing economy, even as expectations for a Federal Reserve
rate cut were solidified.
The S&P 500 finished down
0.32% at 6,481.50, while the Nasdaq
Composite declined 0.03% to settle at 21,700.39. The Dow Jones Industrial Average closed
down 220.43 points, or 0.48%, at 45,400.86.
All three leading indexes had reached
fresh record intraday highs earlier in Friday’s session. At their peaks, the
broad market index, the tech-heavy Nasdaq and the blue-chip Dow were up about
0.5%, 0.8% and 0.3%, respectively.
Asia-pacific
markets: Nikkei 225, Japan yen, Ishiba resignation
Wall Street Week Ahead
Sep. 07, 2025 9:04 AM ET
Wall Street's attention will switch from
one half of the Fed mandate - maximum employment - to the other half - price
stability. Following an August payrolls report that underscored weakness in the
jobs market, the latest inflation figures arrive.
The Consumer Price Index arrives on
Thursday. Economists predict the core CPI, ex food and energy, rose 0.3% on the
month, with the annual rate staying at 3.1%. A cool CPI report could boost the
odds that the FOMC cuts rates by 50 basis points on Sept. 17. The Producer
Price Index hits Wednesday, while the University of Michigan releases its
preliminary measure of September consumer sentiment on Friday.
Earnings reports remain sparse, but there
will be numbers from Kroger (KR) and Adobe (ADBE), as well as
retail investor favorites GameStop (GME) and Chewy (CHWY).
Wall Street Week
Ahead | Seeking Alpha
In other news.
China’s U.S. shipments plunge 33% in August as
overall exports growth hits a 6-month low
Published Sun, Sep 7 2025 11:18 PM EDT
China’s shipments to the U.S. plunged 33%
in August while overall exports growth slowed to its weakest level in six
months, as President Donald Trump’s policy targeting transshipments weighed on
exports and businesses’ frontloading activity lost momentum.
Imports from the U.S. also dropped 16%
from a year ago, customs data showed.
China’s total exports climbed 4.4% in
August in U.S. dollar terms from a year earlier, customs data showed Monday, marking their lowest growth
since February while missing Reuters-polled economists’ estimates for a
5.0% rise.
That growth slowed from the prior two
months, in part reflecting the statistical effect of a high base last year when
China’s exports grew at their fastest pace in nearly one-and-a-half years.
Imports rose 1.3% last month from a year
ago, missing Reuters estimates for a 3% growth. Imports rose for a third
straight month after returning to growth in June, albeit still muted due to the
persistent real estate slump, rising job insecurity, among other things.
China has increasingly relied on
alternative markets, particularly Southeast Asia and European Union nations,
Africa and Latin America, as U.S. President Donald Trump’s trade policy has
pressured U.S.-bound shipments.
Nonetheless, no one country has come close
to the U.S. which remains China’s largest trading partner on a single-country
basis, absorbing $283 billion of Chinese goods this year as of August.
Exports to the EU stood at $541 billion over the same period.
Beijing and Washington on Aug. 11 agreed
to extend their tariff truce by another 90 days, locking in place U.S. tariffs
of around 55% on Chinese imports and 30% Chinese duties on U.S. goods,
according to Peterson Institute for International Economist.
But bilateral talks appear to be
struggling to reach a breakthrough, with a late-August visit to Washington by
top Chinese trade negotiator Li Chenggang yielding little progress.
Chinese exporters have relied on routing
shipments to third countries to sidestep U.S. tariffs — a tactic that is facing
the test of tightening U.S. scrutiny over the so-called transshipments, which
analysts have warned could weigh on Chinese exports in the coming months.
The U.S. in
July announced a 40% tariff on any shipments that Washington
determines to be transshipped.
An exports-oriented private survey
RatingDog purchasing managers’ index showed China’s manufacturing activity
sharply beat expectations in August, boosted by a recovery in new export
orders, suggesting resilient external demand.
China is set to release two closely
monitored inflation gauges later this week, including the consumer price index
and producer price index.
Goldman Sachs expects the PPI inflation to
remain “deeply negative,” falling 2.9% year on year, with the month-on-month
reading to turn positive on the back of Beijing’s “anti-involution” policies
aimed at reducing excessive price-cutting and the recent increases in upstream
raw material prices.
The Wall Street bank forecasts headline
CPI inflation to be “moderately negative,” falling 0.2% last month from a year
ago.
China's
August U.S. shipments plunge 33% as overall exports growth slows
Google leads monster week for tech, pushing
megacaps to combined $21 trillion in market cap
Published Fri, Sep 5 2025 4:19 PM EDT
From the courtroom to the boardroom, it
was a big week for tech investors.
The resolution of Google’s
antitrust case led to sharp rallies for Alphabet and Apple. Broadcom shareholders cheered a new
$10 billion customer. And Tesla’s stock was buoyed by a freshly
proposed pay package for CEO Elon Musk.
Add it up, and the U.S. tech industry’s
eight trillion-dollar companies gained a combined $420 billion in market cap
this week, lifting their total value to $21 trillion, despite a slide in Nvidia shares.
Those companies now account for roughly
36% of the S&P 500, a proportion so great by historical standards that
Howard Silverblatt, senior index analyst at S&P Dow Jones Indices, told
CNBC by email, “there are no comparisons.”
Alphabet’s 9% jump on Wednesday was
directly tied to the U.S. government effort to diminish the search giant’s
market control, which was part of a years-long campaign to break up Big Tech.
Since 2020, Google, Apple, Amazon and Meta have all been hit with
antitrust allegations by the Department of Justice or Federal Trade Commission.
A year ago, Google lost to the DOJ,
a result viewed by many as the most-significant antitrust decision for the tech
industry since the case against Microsoft more than
two decades earlier. But in the remedies ruling this week, U.S. District
Judge Amit
Mehta said
Google won’t be forced to sell its Chrome browser despite its loss in court and
instead handed down a more limited punishment, including a requirement to share
search data with competitors.
The decision lifted Apple along with
Alphabet, because the companies can stick with an arrangement that involves
Google paying Apple billions of
dollars per year to be the default search engine on iPhones. Alphabet rose more
than 10% for the week and Apple added 3.2%, helping boost the Nasdaq 1.1%.
Analysts at Wedbush Securities wrote in a
note after the decision that the ruling “removed a huge overhang” on Google’s
stock and a “black cloud worry” that hung over Apple. Further, they said it
clears the path for the companies to pursue a bigger artificial intelligence deal
involving Gemini, Google’s AI models.
“This now lays the groundwork for Apple to
continue its deal and ultimately likely double down on more AI related
partnerships with Google Gemini down the road,” the analysts wrote.
Mehta explained that a major factor in his
decision was the emergence of generative AI, which has become a much more
competitive market than traditional search and has dramatically changed the
market dynamics.
New players like OpenAI, Anthropic and
Perplexity have altered Google’s dominance, Mehta said, noting that generative
AI technologies “may yet prove to be game changers.”
On Friday, Alphabet investors shrugged off
a separate antitrust matter out of Europe. The company was hit with a
2.95-billion-euro ($3.45 billion) fine from
European Union regulators for anti-competitive practices in its advertising
technology business.
More
Tech's megacaps are now worth $21 trillion as market caps swell
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.
Postal
traffic to US drops more than 80% after trade exemption rule ends, UN agency
says
September
7, 2025 1:54 PM ET
Postal
traffic to the U.S. has fallen significantly after the Trump administration
suspended a trade exemption rule in late August, according to a global postal
union.
The
U.N.'s Universal Postal Union (UPU) said the global postal network saw postal
traffic enroute to the U.S. "come to a near halt" after Aug. 29,
2025, when the "de minimis" trade exemption that allowed small
packages worth less than $800 to be exempt from tariffs ended. Data between
postal operators shows that traffic dropped 81% on Aug. 29 compared to a week
earlier, the union said. The UPU also said it is working on ways to get traffic
flowing back to the country.
"The
UPU has in its mission the responsibility to guarantee the free circulation of
postal items over a single postal territory. We're working to uphold that
responsibility with the rapid development of a new technical solution that will
help get mail moving to the United States again," UPU Director General
Masahiko Metoki said in a statement.
NPR
reached out to the White House for comment on Sunday but has not received a
response.
On
July 30 this year, President Donald Trump signed an executive order that would
suspend the de minimis rule for all U.S. imports, with all products coming into
the U.S. being tacked with duties and tariffs according to their country of
origin. The Trump administration has defended the move as a way to crack down
on criminal activity, such as counterfeit products and fentanyl, from entering
the country, as well as helping to lower the trade deficit.
More
Postal
traffic to US drops more than 80% after trade exemption rule ends, UN agency
says : NPR
'Mini-stagflation
is brewing': 5 fresh signs that the economy's worst-case scenario could be
inching closer
6
September 2025
Concerns
about stagflation — a dreaded
scenario where the economy grows sluggishly while inflation remains stubbornly
hot — have ebbed and flowed on Wall Street in recent months. But fears about
such a scenario has started to creep back on the radar of investors, thanks to
a growing pile of evidence that suggest stagflation could be on its way.
Stagflation,
often dubbed the worst-case
scenario for the US economy, is thought to be even more difficult for
policymakers to resolve than a typical recession. That's because
hotter inflation means the Fed is unable to lower interest rates to boost
economic growth, as the central bank would in a typical recession.
In
a note to clients on Thursday, Bank of America said the Fed's path forward
looked "bimodal," given risks swirling around stagflation.
BCA
Research, meanwhile, said it was worried about it over the next year.
"Over
a 12-month horizon, we are more concerned about the 'stag' part than the
'flation' part of stagflation," Peter Berezin, the chief global strategist
at the firm, wrote in a report, pointing to the inflationary and potential
growth impacts of President Donald Trump's tariffs. "A Mini-Stagflation Is
Brewing," he later added.
Here
are four warning signs market-watchers were eyeing this week:
1.
Job growth dropped way below expectations
The US
job market continued
to disappoint, with the economy adding 22,000 jobs for the month of August.
That compares to the 75,000 payrolls economists were expecting, and the 79,000
jobs the economy added the prior month.
"Job
growth is clearly signaling a slowdown in the economy. Even factoring in
concerns about data accuracy, the latest BLS figures are now aligning with what
other surveys and data providers have been indicating for months," Kevin
O'Neil, a senior research analyst at Brandywine Global, wrote in a note.
2.
Private employment fell short
Employment
in the private sector also stumbled. Private employers hired 54,000 workers in
the month of August, according to the latest ADP jobs report, lower than the
75,000 economists were expecting.
Private
job growth for the month also fell way below last month's levels, when private
employers hired 106,000.
"The
evidence of significant labor market slowing continues to mount," Scott
Anderson, the chief US economist at BMO, wrote in a note to clients on Friday.
3.
Joblessness crept higher
New
filings for unemployment
benefits rose
to 237,000 in the week ending August 30, the Labor Department said on Thursday.
That was the highest number of weekly jobless
claims filed
since June, and beat economists' estimates of 230,000 applications.
The
unemployment rate also ticked up to 4.3% from 4.2% in August, per the latest
jobs report. The overall jobless rate remains near historic lows, but it's the
highest rate of unemployment the economy has seen since 2021.
4.
Manufacturing contracted while prices rose
The
manufacturing sector just logged its sixth-straight month of contraction, with
the Institute for Supply Management Manufacturing PMI coming in at 48.7% for
the month of August.
The
Prices Index component, meanwhile, remained in expansionary territory at 63.7%.
The index has climbed around 11 percentage points over the last nine months,
largely rising material costs, the ISM said. It pointed in particular to steel
and aluminium,
which are impacted by tariffs.
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.
This Nuclear Battery Won’t Quit For 433 Years—NASA’s Most
Ambitious Power Source Yet
September 5, 2025
A battery that lasts more than four
centuries? That’s exactly what NASA and the University of
Leicester are currently testing. Their goal: to develop a new nuclear
battery powered by americium-241, a radioactive isotope capable of
fueling space probes for 433 years. The research was recently
featured in Popular Mechanics, and it could mark a major turning point in how we
think about long-duration space missions.
A Major Upgrade To A Spaceflight Staple
NASA has been using radioisotope
power systems (RPS) for decades. These systems generate electricity
from the heat released by radioactive decay, and they’re a big reason missions
likeVoyager, New Horizons, Curiosity,
and Perseverancehave lasted so long. Until now, these batteries
relied on plutonium-238, which breaks down steadily over time but can only
power missions for a few decades at best.
Americium-241 changes that.
With a half-life of 433 years, it keeps producing heat for centuries. That
opens the door to truly long-term missions—ones that could outlast not just the
spacecraft’s designers but entire generations of scientists.
And yes, NASA has strict safety
standards for anything radioactive. Americium-241 passes the test. It’s “minimally
toxic,” and when used in ceramic form, it won’t vaporize. If something goes
wrong, it breaks into large, chunky pieces—meaning it’s a lot less likely to be
inhaled or absorbed into the body.
Building A Better Engine For Space
But the fuel itself is just one part of
the story. The real magic is how that heat gets turned into usable electricity.
Right now, NASA is testing a new type of engine called a free-piston
Stirling convertor. Unlike older systems with crankshafts, this one floats
pistons inside a sealed chamber. It’s cleaner, more efficient, and built for
microgravity.
These convertors aren’t untested either.
One has already run for 14 years without maintenance at NASA’s
Glenn Research Center—which just so happens to be the minimum life needed for
many deep space missions.
Wayne Wong, head of Glenn’s Thermal
Energy Conversion Branch, described the progress in a press release as
“particularly significant” for missions that have long cruise times and can’t
afford any downtime.
Easier To Produce And Ready To Scale
One of the challenges with plutonium-238
is that it’s expensive and slow to make. After a 30-year production
pause, the U.S. only restarted its supply in 2011 with help from the
Department of Energy. Even now, production happens at a few facilities, like
Oak Ridge and Idaho National Laboratories.
In contrast, americium-241 is
much easier to get. It’s a common byproduct of nuclear reactors, so there’s
already a decent supply. Right now, Los Alamos National Laboratory is working
on improving the production process—making it safer and more efficient for
long-term use in space.
There are some challenges. Americium-241
emits more gamma radiation than plutonium, which means better shielding will be
needed. But engineers seem confident that’s a solvable problem, especially
considering how much longer this fuel can last.
More
This Nuclear Battery Won’t Quit For 433 Years—NASA’s Most Ambitious Power
Source Yet
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt
Clocks (usdebtclock.org)
The
most likely way for the world to be destroyed, most experts agree, is by
accident. That’s where we come in; we’re computer professionals. We cause
accidents.
Anon.
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