Are/Have Stocks And Commodities Become/ing Unstable?

Baltic Dry Index. 2094 +23      Brent Crude 62.31

Spot Gold 4149            US 2 Year Yield 3.45 -0.01

US Federal Debt. 37.926 trillion

US GDP 31.524 trillion.

When the final result is expected to be a compromise, it is often prudent to start from an extreme position.

John Maynard Keynes

Have our stock casinos and commodity markets become unstable? What will it mean for the global economy if they have become unstable?

In whipsaw markets few make money while many make losses. But where are those losses now piling up?

Asia-Pacific markets mostly fall as investors assess Japan trade data; SoftBank drops over 5%

Published Tue, Oct 21 2025 7:47 PM EDT

Asia-Pacific markets mostly fell Wednesday as investors assessed trade data from Japan and the country’s new leadership.

Japanese exports in September snapped four months of declines, climbing 4.2% year on year, as shipments to Asia saw robust growth, partially offsetting the drop in exports to the U.S.

Exports, however, missed analysts’ expectations of a 4.6% rise, according to median estimates in a Reuters poll of economists.

Prime Minister Sanae Takaichi and her new cabinet were sworn in on Tuesday, with her former rival in the ruling Liberal Democratic Party’s leadership race, Shinjiro Koizumi, named defense minister and Satsuki Katayama becoming Japan’s first female finance minister.

Japan’s Nikkei 225 was down 0.48%, leading losses in Asia, while the Topix index gained 0.33%.
Shares of SoftBank plunged over 10% before paring losses to about 5%. Shares had gained 8.5% on Monday.

On Tuesday, the Nikkei briefly set a new intraday record of 49,945.95, before retreating after Takaichi won the parliamentary vote to become Prime Minister.

South Korea’s markets bucked the wider fall in the region, with the Kospi index rising 0.3%, and the small-cap Kosdaq up 0.1%.

Shares of LG Chem soared as much as 10% after Palliser Capital urged the chemicals company to revamp its board and buy back shares, according to a Reuters report.

Australia’s S&P/ASX 200 was down 0.87%, pulling back from earlier gains on Tuesday after rare earth stocks briefly rallied on news of a U.S.-Australia critical minerals agreement.

Hong Kong’s Hang Seng index slipped 0.83%. Shares of Labubu doll maker Pop Mart surged about 6% on the index after posting strong third-quarter results.

The CSI 300 on mainland China opened 0.69% lower.

Indian markets are closed for a holiday.

Overnight in the U.S., the Dow Jones Industrial Average set a new closing record, boosted by strong earnings reports from companies such as Coca-Cola and 3M, while the S&P 500 was relatively unchanged.

The 30-stock index gained 0.47% to close at 46,924.74, and briefly topped 47,000 during the session.

The broad market S&P 500 closed just above the flatline at 6,735.35, while the tech-heavy Nasdaq Composite lagged, falling 0.16% to 22,953.67.

Asia-Pacific stocks live updates: Japan trade data, new government

Gold is getting knocked on Tuesday – it’s still the hottest trade of the year

Published Tue, Oct 21 20251:10 PM EDT

While gold was taking a hit on Tuesday, the metals trade has outshined artificial intelligence on Wall Street this year, even the latter has propelled the broader stock market to record levels.

Gold crossed the $4,000-per-ounce threshold earlier in October, and just this week, it hit a record above $4,300. It’s currently up more than 50% this year. Not only that, silver is trading near record levels and has soared more than 60%. That’s despite easing trade tensions between the U.S. and China leading to a slight pullback in both metals – President Donald Trump said Monday he expects to reach a “really fair and really great” deal with Chinese President Xi Jinping in South Korea later this month.

Precious metals have gained in 2025 thanks to concerns around global trade, expectations of Federal Reserve rate cuts and a drop in the U.S. dollar. But the size of those returns is unusual for gold and silver, especially when the stock market is doing well. The Nasdaq-100 is up more than 19% this year, while the the S&P 500 has climbed more than 14%, with both hitting records this year as a result of the AI investing boom. The commodity has even beaten out AI giant Nvidia’s jump of more than 34%.

“The market is somewhat changing its view on gold as an asset class right now,” David Wagner, head of equity at Aptus Capital Advisors, said in an interview with CNBC. “It’s no longer just being utilized as kind of a simplistic way to hedge your currency or hedge your portfolio.”

Instead, investors are seeing it as a scarce asset as the “currency debasement” trade gains momentum on Wall Street. This trade refers to investors hedging against government borrowing and money printing, lessening the U.S. dollar’s value by moving into gold and other assets.

“People want to own risk assets,” Wagner said. “People want to own hard assets, given where we stand in our current debt and the debasement of currency that does occur on an annualized basis from inflation.”

“The gold mentality has somewhat changed over the last few years,” he added.

The run-up

While gold has outpaced the broader market since the tech bubble peak in 2000, its move really became apparent in 2022, when the U.S. alongside others such as the European Union froze Russia’s central bank reserves in the wake of that country’s invasion of Ukraine.

“That event woke up the rest of the world to say, ‘Hey, let me double check how much of U.S. dollar reserves I have, and maybe this is a good catalyst to reduce that exposure,’” said Peter Boockvar, chief investment officer at One Point BFG Wealth Partners.

The move set off significant amounts of central bank gold buying in not only 2022 but also 2023 and 2024. That pace has since only quickened this year following Trump’s decision to impose “reciprocal” tariffs on a number of countries months ago.

More

Gold is getting knocked on Tuesday – it’s still the hottest trade of the year

In other news.

China says U.S. and Australia ‘should play a proactive role’ to bolster rare earths supply chains

Published Tue, Oct 21 2025 5:01 AM EDT Updated Tue, Oct 21 2025 8:37 AM EDT

China on Tuesday responded to the U.S.-Australia critical minerals deal by saying resource-rich rare earth countries should take “a proactive role” in stabilizing their critical minerals supply chains.

A spokesperson for China’s Ministry of Foreign Affairs was asked about the U.S. and Australia critical minerals deal which has been framed as an effort to counter Beijing’s dominance.

“The formation of global production and supply chains is the result of market and corporate choices,” Guo Jiakun said, according to NBC.

“Resource-rich nations with critical minerals should play a proactive role in safeguarding the security and stability of the industrial and supply chains, and ensure normal economic and trade cooperation,” he added.

Rare earths are a category of minerals that are critical for a swath of products from cars to semiconductors.

U.S. President Donald Trump and Australian Prime Minister Anthony Albanese on Monday signed an agreement at the White House intended to boost the supplies of rare earths and other critical minerals.

The framework agreement, which was described as an $8.5 billion deal between the allies, comes shortly after China imposed more stringent export controls on rare earths.

China’s Commerce Ministry earlier this month announced expanded curbs on the export of rare earths and related technologies, seeking to prevent the “misuse” of minerals in the military and other sensitive sectors.

Western automotive industry groups have been among those to raise the alarm over the new export controls, saying the measures could pave the way to a period of supply chain chaos.

Demand for rare earths and critical minerals is expected to grow exponentially in the coming years as the clean energy transition picks up pace.

China is the undisputed leader of the critical minerals supply chain, accounting for roughly 60% of the world’s production of rare earth minerals and materials. U.S. officials have previously warned that this poses a strategic challenge amid the pivot to more sustainable energy sources.

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Rare earths: China responds to U.S.-Australia critical minerals deal

China-U.S. 

Cover Story: Trade War Deepens as U.S. and China Open New Fronts at Sea and in Silicon

21 October 2025

In the weeks leading up to the APEC summit in South Korea, a new chapter has opened up in U.S.–China rivalry — this time far from the negotiating tables but deep inside the ports, shipyards and customs offices that keep global trade moving.

What began in early autumn as a cautious thaw between Washington and Beijing — marked by cordial trade talks in Madrid and a phone call between Xi Jinping and Donald Trump — has quickly unraveled. Within weeks, both sides have cast aside diplomatic restraint, rolling out a barrage of targeted trade restrictions that signal a sharp return to confrontation.

• China-U.S. Shipping Rates Spike as Exporters Rush to Beat Potential Trump Tariffs
   
• U.S. Trade Tensions to Overshadow APEC Summit in South Korea
   
• Commentary: Trump’s Tariffs Are Remapping U.S. Imports From Asia

CX Daily: Trade War Deepens as U.S. and China Open New Fronts at Sea and in Silicon

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.

UK government borrowing soars in September to highest in five years

Tuesday 21 October 2025 7:09 am  |  Updated:  Tuesday 21 October 2025 7:30 am

UK government borrowing soared to £20.2bn in September, official data has revealed, in another Blow for Rachel Reeves as she gears up for a painful tax-raising Budget next month.

The Office for National Statistics (ONS) said government borrowing over the month was the highest in the month seen for five years and an increase of £1.6bn compared to the previous month. 

Economist had forecast the government to borrow £20.5bn over the month. 

Over the first six months of the current financial year, government borrowing was the second-highest ever recorded at £99.8bn. The current budget deficit stood at £71.8bn.

It also said debt interest payments over last month was £9.7bn while debt as a share of GDP stood at 95.3 per cent a percentage point higher than levels a year ago. 

Fresh data adds to woes in public finances as Labour ministers struggle to restrict government borrowing to cover expenditure on services such as the NHS and security. 

It is also one of the last sets of ONS publications the Chancellor will see before the Budget on 26 November. 

Richard Carter, head of fixed interest research at Quilter Cheviot, said: “Without a shift in the fiscal rules once again, the UK economy is in somewhat of a straitjacket.

“Fiscal headroom is all but non-existent, and the growth that is required to create it is being hampered by a high tax burden and uncertainty of more revenue raising measures from the government to come.

“The economic winds are refusing to blow in the UK’s direction, but the recent fall in gilt yields have bought some breathing room. What the government does with that will be watched very closely at the despatch box next month.”

Chief secretary to the Treasury James Murray said: “This government will never play fast and loose with the public finances. We know that when you lose control of the public purse it’s working people who pay the price.

“That’s why we plan to bring down borrowing, and according to IMF data, are set to deliver the largest primary deficit reduction in both the G7 and G20 over the next five years.”

Shadow Chancellor accused the Reeves of making “the next generation…saddled with Labour’s debts”.

“If Rachel Reeves had a plan – or a backbone – she would stand up to her backbenchers, get spending under control and cut the deficit. Instead she is plotting to hike taxes yet again to pay for her failures,” Stride said.

Government borrowing data sets up for difficult Budget

Reeves is widely expected to face a fiscal hole valued at around £30bn if she wishes to keep to her fiscal rule stating that day-to-day spending should match receipts by 2030. 

City economists believe her headroom of some £9.9bn left at the Spring Statement has been washed out by higher borrowing costs than forecast and policy U-turns on welfare savings in the middle of a year. 

An expected productivity downgrade by the fiscal watchdog is also set to widen the shortfall. 

But in the run-up to the Budget, the Treasury is rushing to announce growth-inducing policies that can lessen the impact of expected Office for Budget Responsibility (OBR) downgrades to forecasts. 

Policies announced include sweeping planning reforms and a move unveiled today to accelerate the process of reducing the extent of red tape for businesses. 

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UK government borrowing soars in September to highest in five years

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.

Tesla dominates UK mega battery market

Group led by Elon Musk, criticised by energy secretary Ed Miliband, supplies units and trades power from them

20 October 2025

Tesla has quietly built a leading position in the UK’s mega battery market, deepening its role in Britain’s efforts to shift away from fossil fuels.

The group led by Elon Musk not only supplies large-scale batteries to plant developers but also trades the power generated by them. Tesla’s batteries perform the best in terms of revenue in an increasingly competitive market that has also lured the likes of Goldman Sachs, data from battery market specialists Modo Energy indicates. 

The data comes two weeks after Ed Miliband, the energy secretary who is leading Britain’s clean-energy transition, gave a speech in which he told Musk, to “get the hell out of our politics and our country”, after the tech billionaire criticised the UK via his social media site X. 

Tesla has long sold batteries to British homeowners as part of its electric car offering. But mega batteries are able to store power when there is a lot being generated by power stations around the country — and prices are low — and then discharge it across the grid when supplies are scarcer and prices higher. This ability to smooth out supply means so-called grid-scale batteries are a key part of countries’ efforts to move away from fossil fuels.

Tesla’s success is down to the sophisticated approach of the company’s Autobidder trading software as well as its batteries’ larger storage capacity and location, experts said.

“The [Autobidder] platform is constantly repricing bids and trying to outcompete the competition in a more dynamic, data-driven way than some of the more classic manual dispatch,” said Joe Bush, market analyst at Modo Energy.

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Tesla dominates UK mega battery market

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

World Debt Clocks (usdebtclock.org)

There is nothing so disastrous as a rational investment policy in an irrational world.

John Maynard Keynes