Baltic Dry Index. 1966 -17 Brent Crude 65.21
Spot Gold 4023 US 2 Year Yield 3.60 -0.01
US Federal Debt. 38.016 trillion
US GDP 31.550 trillion.
"Considerable uncertainty is attached to all economic estimates"
Alan Greenspan, Chairman Federal Reserve Board.
A mixed start to the stock casinos, the Christmas retail season and US “food stamps” now renamed SNAP, the Supplemental Nutrition Assistance Program.
A PR disaster averted. 42 million Americans start going hungry while President Trump funds his $300 Presidential ballroom.
It’s a funny old world in 2025.
Asia-Pacific markets trade mixed as China PMI data
misses expectations; Kospi leads gains
Published Sun, Nov 2 2025 7:15 PM EST
Asia-Pacific markets traded mixed Monday,
after Wall Street saw all three U.S. major indexes climb Friday stateside.
Investors in Asia are assessing
manufacturing activity figures out from China after RatingDog published its
purchasing managers index for October.
China’s manufacturing activity slowed to
50.6, missing the 50.9 expected by economists polled by Reuters and lower than
September’s 51.2.
The official PMI numbers released Friday by the National
Bureau of Statistics showed that China’s
manufacturing activity in October shrunk to its lowest level in six
months, coming in at 49.0.
Hong Kong’s Hang Seng index rose 0.58%,
while mainland China’s CSI 300 dipped 0.45%.
South Korea’s Kospi was
up 2.13%, leading gains in Asia and touching a new intraday high, while the
small-cap Kosdaq gained 1.18%.
India’s Nifty 50 was 0.11% up, while
the Sensex lost 0.34%.
Australia’s S&P/ASX 200 was flat.
The country’s central bank starts its
two-day monetary policy meeting today, with economists expecting a hold from
the Reserve Bank of Australia after inflation readings came in hotter than
expected for the third quarter.
Japan’s markets are closed for a public
holiday.
On Friday in the U.S., the
tech-heavy Nasdaq Composite advanced
0.61% at 23,724.96, while the S&P 500 gained 0.26% to reach 6,840.20.
The Dow Jones Industrial
Average closed marginally higher at 47,562.87.
Asia-Pacific
markets trade mixed as China PMI data misses expectations; Kospi leads gains
Stock futures are little changed to start November
trading: Live updates
Updated Mon, Nov 3 2025 12:27 AM EST
Stock futures were little changed on
Monday morning, as a new month of trading begins.
S&P 500 futures ticked
higher by 0.17%, while Nasdaq-100
futures were up 0.26%. Dow Jones Industrial Average futures advanced
49 points, or 0.1%.
Wall Street is coming off a winning
session that added to the benchmark’s October gains. The S&P 500 and Dow
industrials climbed 2.3% and 2.5%, respectively, for the month. The Nasdaq
Composite outperformed, gaining 4.7%.
Those gains were driven in part by
continued momentum in the artificial intelligence trade as well as signs of
easing trade tensions between the U.S. and China.
More than 300 S&P 500 companies have
posted third-quarter results thus far. Of those, over 80% have beaten
expectations, according to FactSet. Wall Street will get another 100-plus
companies reporting this week, including AI-related names Palantir and AMD.
“Fundamentally, the U.S. earnings picture
remains strong and supported by these 3 factors: AI spending visibility remains
strong and Amazon’s strong 3Q25 report is the latest evidence of this;
financials are driving innovation via blockchain; the Fed is dovish and
lowering interest rates; and QT (quantitative tightening) is ending Dec 1,”
wrote Tom Lee, head of research at Fundstrat.
Wall Street may get a seasonality boost
this month. Data from the Stock Trader’s Almanac shows the S&P 500 averages
a 1.8% gain in November, making it the strongest month historically for the
benchmark.
Investors also kept an eye on Washington,
as the U.S. government remains shut down. The stoppage has delayed several key
economic data releases, including the monthly jobs report.
On top of that, the Supreme Court is
expected to hear
oral arguments on legality of the Trump administration’s tariffs.
Stock
market today: Live updates
Treasury Secretary Bessent says SNAP food
benefits could restart by Wednesday
Published Sun, Nov 2 2025 10:49 AM EST
SNAP food benefits could restart as early
as Wednesday, Treasury Secretary Scott Bessent said on Sunday morning.
Two federal judges in Massachusetts and
Rhode Island ruled on Friday that the Trump administration must use emergency
funds to pay SNAP benefits, which help feed 42 million Americans, during the
government shutdown.
Judge Jack McConnell of Rhode Island also
directed that these be paid out of emergency funds “as soon as possible.”
Boston Judge Indira Talwani gave the administration until Monday to tell her if
it will authorize at least reduced SNAP benefits for November.
The administration was originally set to
cut off the aid on Nov. 1.
In an interview on CNN’s
“State of the Union,” Bessent said that the administration would not
appeal the court ruling, while adding that finding the funds to pay SNAP
benefits by Wednesday “could be” done.
“There’s a process that has to be
followed. So, we’ve got to figure out what the process is,” the Treasury
secretary said.
On Friday, President Donald Trump said in
a Truth Social post that the government was exploring
its options to restart SNAP.
“I do NOT want Americans to go hungry just
because the Radical Democrats refuse to do the right thing and REOPEN THE
GOVERNMENT,” the president wrote. “Therefore, I have instructed our lawyers to
ask the Court to clarify how we can legally fund SNAP as soon as possible.”
Bessent
SNAP food benefits could restart by Wednesday
In US government shutdown news, so far so good.
Flight delays, airport disruption fears grow as
government shutdown drags on
November 2, 2025
The Trump administration is pointing to
the woes of the nation’s aviation system to ratchet up pressure on Democrats as
the government shutdown enters its second month and the sides remain at
loggerheads.
An estimated 700,000 federal workers are
considered essential and must work without pay while the government is closed.
Even though air traffic controllers make up less than 2 percent of that group,
their plight has received extra attention.
Vice President JD Vance warned Thursday
that the flight disruptions rippling throughout the system could worsen if
stressed-out controllers and other key frontline aviation workers stop
reporting for work.
“Look, it could be a disaster,” he said
when asked about the potential impact the shutdown could have on Thanksgiving
travel plans. “It really could be because … you’re talking about people have
missed three paychecks. They’ve missed four paychecks. How many of them are not
going to show up for work?”
Controllers missed their first paycheck
this past week.
“Everybody here is very worried that we’re
going to see more delays, more stresses on the people who are actually making
the aviation system run and more problems for both the consumers, but also the
great workers who actually make this incredible shining jewel of the American
economy actually work,” Vance said.
So far, however, the impact of the
shutdown has been relatively muted. Earlier in the week, at a news conference
at LaGuardia Airport, Transportation Secretary Sean P. Duffy conceded there
have been fewer disruptions than during the last government shutdown. But he
argued that the aviation system remains fragile, short 3,000 controllers for
what it needs.
Data from Cirium, an aviation analytics
company, found that performance during the first few weeks of the shutdown was
average to above average, with little change at major U.S. airports. When
disruptions did occur, they were more likely tied to weather in the Northeast,
the company said.
Meanwhile, the number of flight
disruptions linked to understaffing has varied widely. For example, on Oct. 7,
about 53 percent of delays were linked to staffing shortages, but the next day,
that number dropped to only 4 percent, according to data from the Federal
Aviation Administration. Before the shutdown, Duffy said, an average 5 percent
of delays were caused by staffing issues.
More generally, airlines have been
fortunate in that the shutdown occurred during a traditionally slow period for
airlines and that October weather has been relatively mild, analysts say.
“This is a time when airlines normally
reduce the number of flights they operate due to the lower seasonal demand,”
said Henry Harteveldt, an aviation analyst and president of Atmosphere Research
Group. In recent earnings calls, several airlines said they planned to
reduce their fall and winter flying to keep supply tighter and avoid having to
cut prices, he added.
Airlines have also likely done contingency
planning given this isn’t the first time they’ve had a government shutdown, he
said.
Another factor is that airlines have
invested in technology and taken lessons learned during the pandemic to
strengthen their operations and improve their resilience, said Chris Sununu,
CEO of the airline trade group Airlines for America. He also credited the FAA
with putting strategies in place to adapt more quickly to disruptions.
Still, staffing shortages at key airports
this past week, including one at Los Angeles International over the weekend and
several more at Washington’s Reagan National and Chicago’s O’Hare
International, have made headlines. And there are some indications the
system might be growing increasingly strained.
Thursday was the first indication of a
broader, systemwide slowdown, according to Cirium. Data showed an uptick in
cancellations at the three major New York-area airports as well as Boston’s
Logan International. Disruptions at major airports can quickly cascade through
the broader aviation system.
More
Flight delays, airport
disruption fears grow as government shutdown drags on
In other news.
China poised to benefit as blackout risk rises
from Iberia to Siberia
Grid operators face billions of dollars in
investment and need to work with Beijing
Published Sep 12 2025
The International Energy Agency did not
mince its words when, in February this year, it laid out the stark challenges
facing electricity systems around the world.
Global annual investment in power
transmission alone will need to more than double, from about $140bn in 2023 to
as high as $300bn in the mid-2030s, if the world is to meet rising demand for
power and emissions reduction targets. “
Around 1.5mn kilometres of new
transmission lines have been built worldwide over the last decade, but
inadequate transmission remains a major constraint on power system development,
electrification and energy security,” say IEA analysts.
China, which has a large and growing
industry of electricity equipment and hardware suppliers, is well positioned to
capitalise on the sorry state of the world’s electricity transmission system,
analysts say.
As if to make the IEA’s point, two months
on, in late April, Spain suffered a day-long blackout that cut power across
everything from telecoms and internet networks to businesses and rail systems,
with disruptions also hitting neighbouring Portugal.
For governments around the world, the
outage emphasised the need to address under-investment in electricity networks.
This is viewed as necessary to meet not
only rising demand for artificial intelligence, electric vehicles and data
centres, but also the changing landscape of electricity generation from legacy
systems powered by large-scale fossil fuel plants to dynamic and
weather-dependent systems using increasing amounts of solar and wind.
But the urgent need to modernise the
world’s electricity grids, from poles and wires to the sophisticated software
for dispatching power at the right place and time, has also highlighted the
likely need to work closely with Chinese manufacturers that have found
themselves at the forefront of an industry plagued with supply shortages.
The Iberian blackout was “just the tip of
the iceberg”, says Alicia García-Herrero, chief Asia-Pacific economist at
Natixis, given that the Spanish grid was not in the worst condition compared
with other transmission systems in Europe. “This is going to hit everybody.”
With western manufacturers unable to keep
pace with demand, China is now poised to make power equipment a “hugely
profitable export market”, adds García-Herrero.
According to Ken Liu, head of China
renewables, utilities and energy research at UBS, supply of gas turbines and
large power transformers face “severe” bottlenecks globally.
Turbines, which have become key to
powering AI data centres, now have a lead time of more than three years, from
about 18 months normally. While planned levels of transformer manufacturing
will only meet half of new demand just from Europe and the US.
Global demand for distribution
transformers — used to step down high-voltage electricity from a power grid to
flow into factories, businesses, data centres or residential areas — is
likewise expected to remain robust, Liu says, and in excess of what some of the
leading western manufacturers have forecast.
The IEA has also noted that lead times for
direct current cables, used for long-distance transmission lines, extend beyond
five years while the price of cables has also nearly doubled since 2019.
More
China poised to
benefit as blackout risk rises from Iberia to Siberia
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.
Tariffs
are expected to start showing up more in consumer prices as holiday shopping
season starts
Published
Fri, Oct 31 2025 1:24 PM EDT Updated Fri, Oct 31 2025 2:29 PM EDT
While
the impact so far this year has been muted, tariffs are expected to catch up
with prices consumers pay just in time for the holiday shopping season.
President Donald Trump’s
tariffs on
a plethora of items and individual countries, which started in April, have
coincided with common inflation measures trudging along between 2.5% and 3%
this year.
While
economists don’t see a major spike coming in common measures such as the consumer price and the
personal consumption price indexes, they expect the tariffs will keep those
gauges elevated at a time when they otherwise would be moving lower.
“There
have been some questions in recent months as to whether tariffs have led to
higher inflation for consumers,” Bank of America economist Aditya Bhave said in
a note. “We think there’s no debate — tariffs have pushed consumer prices
higher.”
Tariff
impacts have been muted so far as companies built up inventories ahead of the
duties and absorbed some of the impact through compressed profit margins.
Bank
of America, though, expects that tariffs will be adding about half a percentage
point to the core PCE measure the Federal Reserve uses when assessing
inflation. With tariffs, BofA estimates that the inflation rate would be 2.9%
in September, so without them that would mean a measure closer to 2.4%. The
numbers are similar to ones Fed Chair Jerome Powell cited
Wednesday. The core PCE on an annual basis was 2.9% in August.
These
percentage point differences matter to the Fed, which tries to keep core
inflation, excluding food and energy, at 2%, a level it has been above since
March 2021. Two Fed officials — regional presidents Jeffrey Schmid of Kansas
City and Lorie Logan of Dallas — said Friday they did not agree with their
colleagues’ decision Wednesday to lower the
central bank’s key interest rate.
For
consumers, they also matter. Bhave estimates that shoppers are bearing about
50%-70% of total tariff costs, with businesses bearing the rest.
Impact
at the cash register
In
real-world terms, that’s meant higher prices for things such as coffee,
furniture and, recently, clothing prices, which jumped 0.7% in September,
according to the Bureau of Labor Statistics. Even though they are minor
components of the price indexes, they are items consumers buy frequently and
can create perceptions about inflation, which can produce a self-reinforcing
cycle that drives prices higher.
“Inflation
in certain goods can have an outsized impact on consumer confidence, even if
those items carry a negligible weight in the CPI basket,” TD Cowen analysts
said in a note. Price increases in items such as eggs create “a constant,
tangible feedback loop every week at the grocery store. Such items shape
perception more than their statistical significance would suggest.”
The
firm noted that this holiday season could see more of that sort of thing as
artificial Christmas trees are almost all imported from China, which faces
heavy costs under the Trump tariffs.
“While
Artificial Christmas trees are not unique, they serve as a clear example of how
high-tariff, seasonal goods can shape consumer perceptions of inflation,” Cowen
said.
Had
the duties been in place during the 2024 holiday season, shoppers would have
spent an additional $40.6 billion, according to LendingTree
estimates using
data from multiple government and private sources.
More
Tariffs are expected to start showing up more in consumer prices as holiday shopping season starts
Covid-19
Corner
This
section will continue only occasionally when something of interest occurs.
Top doctors raise alarm over early 'wave' of deadly respiratory virus...
'it's taking hold'
31 October 2025
Doctors are raising the
alarm over an early winter 'wave' of a deadly respiratory virus that is
sweeping the US.
Independent analysis of
hospital data by Yale University researchers suggests emergency department
(ED) visits due to respiratory syncytial virus (RSV) have surged nationwide
in the month to October 11, the latest date available.
Among children under one
year, who are at highest risk of severe illness and death, visits have surged
to 1.2 percent, the highest level among any age group, and a 2.5-fold rise from
one month ago.
Flu and Covid infections are still low or falling, the data from Yale
suggests, although these viruses normally surge later in the season.
Epidemiologists Dr
Katelyn Jetelina, at Yale University, and Hannah Totte, at the University
of California, Los Angeles, warned that an 'RSV
wave is starting to take hold'.
They wrote on Your Local Epidemiologist: 'RSV activity is starting to climb, especially
among children under four.
'This follows a familiar
pattern: The virus first hits the youngest children (particularly those under
one year) before spreading to adults, often about a month later.'
Updated CDC data on the
spread of RSV, Covid and the flu is currently unavailable because of the
government shutdown, now in its 31st day.
RSV is a particularly
dangerous infection for young children because it can cause inflammation that
may block their small airways, potentially leading to death.
More
Top doctors raise alarm over early 'wave' of deadly respiratory virus...
'it's taking hold'
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.
In tomorrow’s LIR update, did the pin
of the AI circular financing bubble just emerge in China? Lookout below if it
did.
Today, in AI bubble land, garbage in,
garbage out.
Too
much social media gives AI chatbots ‘brain rot’
Large
language models fed low-quality data skip steps in their reasoning process.
31 October 2025
Artificial intelligence (AI)
chatbots are worse at retrieving accurate information and reasoning when
trained on large amounts of low-quality content, particularly if the content is
popular on social media1, finds a preprint posted on arXiv on 15 October.
In data science, good-quality
data need to meet certain criteria, such as being grammatically correct and
understandable, says co-author Zhangyang Wang, who studies generative AI at the
University of Texas at Austin. But these criteria fail to capture differences
in content quality, he says.
Wang and his colleagues
wanted to see the effects of large language models (LLMs) trained on
low-quality data — defined as short, popular social-media posts, or those
containing superficial or sensationalist content. They looked at how these data
affected model reasoning, retrieval of information from long inputs, the ethics
of responses and model personality traits.
The team reports that models
given low-quality data skip steps in their reasoning process — or don’t use
reasoning at all — resulting in the model providing incorrect information about
a topic, or when the authors presented a multiple choice question, the model
would pick the wrong answer. In data sets with a mix of junk and high-quality
data, the negative effect on reasoning increased as the proportion of junk data
increased. The work has not been peer-reviewed.
The findings support a
long-held tenet of AI: the importance of data quality, says Mehwish Nasim, an
AI researcher at the University of Western Australia in Perth. “Even before
people started to work on large language models, we used to say that, if you give
garbage to an AI model, it’s going to produce garbage,” she adds.
Garbage in, garbage out
Wang and his colleagues used
one million public posts on the social-media platform X from an existing
database to train open-source models: Llama 3, an LLM from tech firm Meta in
Menlo Park, California, and three versions of Qwen, developed by Alibaba in
Hangzhou, China. Qwen is a reasoning model, like DeepSeek's R1 model and
OpenAI's o1, meaning it is designed to produce reasoning steps to arrive at an
answer to a user query. Llama, however, is an instruction-tuned language model
and its reasoning ability is less advanced.
To determine the model’s
personality traits, the team used psychology questionnaires. Before training on
junk data, Llama exhibited agreeableness, extroversion, conscientiousness,
openness and a bit of narcissism, say the authors. But as Llama was fed more
junk data, its negative traits were amplified, and psychopathy emerged,
according to one of the questionnaires.
To adapt and improve models
over time, researchers can adjust the prompt instructions. When the team tried
doing this for a Llama model trained exclusively on junk data, they found that
it only partially improved performance, as did increasing the amount of
non-junk data used for training. The model also continued to skip steps when
the team tried to encourage it to reflect on and fix failures in its reasoning,
suggesting that different methods to mitigate the effect of junk data might be
needed.
This finding shows that data
curation is crucial for preventing ‘brain rot’ in AI models, says Stan
Karanasios, who studies AI and social media at the University of Queensland,
Australia. “The most important aspect is to ensure that data is carefully curated,
it’s filtered and excludes low quality or sensationalist content,” he adds.
Nature has approached Meta and Alibaba for comment
about the study findings.
Larger studies are needed
that include models of different sizes and proprietary ones, such as ChatGPT,
says Nasim. The challenges with studying proprietary models are that
researchers need to pay for them and they cannot train them, she adds. Future
research could also determine whether the effects are reversible if models are
given enough good-quality data, she adds.
Last month, social media platform LinkedIn announced
it will be using data and content from users in the UK, parts of Europe and
Switzerland to train generative AI models, starting 3 November.
Too much social media gives AI chatbots ‘brain rot’
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt Clocks
(usdebtclock.org)
"It doesn't matter if you're rich or poor, as long as you've got money”.
Joe E. Lewis
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