Baltic
Dry Index. 2071 -50
Brent Crude 59.64
Spot Gold 4356 Spot Silver 66.03
US 2 Year Yield 3.46 -0.03
US Federal Debt. 38.427 trillion US GDP 31.650 trillion.
To combat depression by a forced credit expansion is to attempt to cure the evil by the very means which brought it about; because we are suffering from a misdirection of production, we want to create further misdirection -- a procedure which can only lead to a much more seve crisis as soon as the credit expansion comes to an end.
Friedrich August von Hayek
US stocks finally rallied, but on dodgy inflation data. Garbage in, garbage out.
S&P 500 futures are little changed after index
ends four-day losing run: Live updates
Updated Fri, Dec 19 2025 7:06 PM EST
Stock futures were little changed Thursday
night after major U.S. indexes closed higher, buoyed by cool inflation data.
S&P 500 futures traded
near the flatline, while Nasdaq
100 futures lost 0.1%. Futures tied to the Dow Jones Industrial Average dropped
86 points, or 0.2%.
In extended trading, Nike shares slid 10%, as the
sports apparel giant saw revenue in its Greater China market decline during
the fiscal
second quarter. The company is also feeling the pain of tariff
increases, noting a hit to its gross margins due to the levies.
The S&P 500 and the Dow both snapped their
four-day losing streaks in the previous session. The Nasdaq Composite also rose,
gaining 1.4%, as several tech stocks recouped losses from the day before.
Stocks on Thursday climbed after a
lighter-than-expected inflation reading from November’s
consumer price index report and gains in the market’s tech leaders.
The CPI data — which reflected a 2.7% year-over-year jump in consumer prices,
lower than expected — gave investors hope that the Federal Reserve will lower
interest rates in 2026. To be sure, some economists
warned that the methodology used in the data release — which was the
first CPI report since the government shutdown this fall — could lead to a
reacceleration in December’s inflation report.
Shares of big-name tech stocks and
chipmakers also rose throughout the day after Micron Technology gave robust
guidance for revenues in the current quarter, saying that “demand is
substantially higher than supply for the foreseeable future.” The results
reassured investors after recent sessions were swamped with jitters over the
artificial intelligence trade. Each of the Magnificent Seven stocks closed
Thursday in the green.
To be sure, semiconductor stocks remain
about 8% below their highs.
“The significance and timing of the
returns on AI investment remain uncertain,” Magdalena Ocampo, market strategist
at Principal Asset Management, wrote in a note to clients. “However, monetary
easing, fiscal policy, and easing trade uncertainty, combined with AI spending
as a new growth engine, point to a more favorable macro backdrop in 2026. The
result could be an equity rally that expands from just a handful of dominant AI
leaders to a broader group, particularly those with tangible gains from AI adoption.”
This week, the S&P 500 and 30-stock
Dow are down about 0.8% and 1%, respectively. The Nasdaq is down 0.8% week to
date.
Friday could see volatile market activity
as options on four types of securities are set to expire on the same day, an
event known as “quadruple witching.” More than $7.1 trillion in notional
options exposure is set to expire this Friday, making it the largest
options expiration on record, according to Goldman Sachs.
Stock
market today: Live updates
Economists warn of flaws in US inflation report
Concerns that November figures showing
fall to 2.7% distorted by missing data after shutdown
18 December 2025
Wall Street economists have warned that
November’s US inflation report, which showed a sharp decline in price growth,
was flawed because of missing data in the wake of the recent government
shutdown.
US consumer prices rose 2.7 per cent in
November from the same period the previous year, according to official data
from the Bureau of Labor Statistics. The figure was well below expectations in
a Bloomberg poll of 3.1 per cent and September’s rise of 3 per cent.
Core inflation, which strips out volatile
food and energy prices, was 2.6 per cent, compared with expectations of 3 per
cent.
The report comes after the recent
government shutdown halted data collection for a six-week period, forcing the
BLS to scrap its October release and estimate many prices rather than using
observed data from surveys.
“You’ve
got to take it with a grain of salt,” said Diane Swonk, chief economist at KPMG
US.
She added: “Things that should be going up
are going down and things that should be going down are going up. So it’s
confusing and it doesn’t quite square with prices that we’ve observed.”
Inflation had remained stubbornly elevated
in recent months, providing a political issue for President Donald Trump as
voters grow frustrated with a worsening cost-of-living crunch. The White
House was quick to seize on Thursday’s release as evidence that Trump’s
policies were helping to curb inflation. “I’m not saying that we are going to
declare victory yet on the price problem, but this is just an astonishingly
good CPI report,” said Kevin Hassett, director of the National Economic Council
and a frontrunner to be next chair of the Federal Reserve.
The bond market largely shrugged off the
inflation report. Yields on short-term government debt briefly tumbled to a
two-month low as prices rose, before soon retracing about half of that move.
Wall Street’s S&P 500 share index
closed 0.8 per cent higher on Thursday and the Nasdaq Composite climbed 1.4 per
cent — in a fresh bout of volatility for equities.
“Markets don’t care [about the data]
because the data doesn’t pass the smell test,” said Jon Hill, head of US
inflation strategy at Barclays.
“Given the lack of explanation about how
the BLS made these decisions, it’s hard to take at face value. Because it was
such a big miss, and because it’s so hard for the market to take the data
literally, investors don’t want to bet the house.”
Analysts said the government shutdown
distorted the figures. The BLS likely zeroed out some inflation readings for
the period when it was unable to collect data, notably in housing costs, which
accounts for a third of the headline figure. Black Friday discount deals in
late November when surveys restarted may have also skewed readings lower.
Michael Hanson, a senior economist at Wall
Street bank JPMorgan, said the lower than expected figures “suggest that the
BLS may have held fixed a number of prices it was not able to collect in
October, which likely means a material downward bias in the current numbers
that will be reversed in coming months as full price collection resumes”.
More
RemovePaywall
| Free online paywall remover
The next rare earths crunch? Top mining CEO warns
copper supply challenges aren’t going anywhere
Published Thu, Dec 18 2025 3:59 AM EST
Copper supply constraints have led to
soaring prices and stockpiling in 2025 –
and according to the CEO of one of the world’s largest mining firms, elevated
prices aren’t likely to climb down anytime soon.
Copper prices hit a
record high of
$11,952 per metric ton on Friday, the latest record high this year driven by
supply concerns, mining disruptions and fears of U.S.
tariffs.
Three-month copper on the London Metal Exchange ended Wednesday’s session at
$11,592 per metric ton.
In New York, copper futures have surged
by around 34% since the start of the year, putting them on track for their best
year since 2009, when copper gained 137.34%.
Speaking to CNBC at the Conference de
Paris in the French capital on Wednesday, Mike Henry, CEO of mining giant BHP stressed that copper is a
“critically important” metal, underpinning the functioning of the everyday
economy while also being a crucial component in decarbonization and
digitalization technologies. The red metal is used in electrical equipment, construction
and industrial machinery.
“It’s about a $300-400 billion per annum
market versus rare earths, which you all would have heard about, which is about
$20 billion per annum. So it’s a very large market,” Henry said at the
conference, which was organized by the Inernational Economic Forum of the
Americas.
Copper, like rare earth minerals — which
also play a critical
role in
the production of various goods from semiconductors to military hardware — is
coming under pressure as supply is being outpaced by surging demand. With
“demand growing strongly,” Henry suggested it was possible that the bull run on
copper could be extended for years to come.
“We expect [demand’s] going to be up by
70% between now and 2050, but supply is becoming more and more difficult to
bring on,” he told CNBC on Wednesday. “Fewer mines are being found. The mines
that are being found are oftentimes smaller, lower grade in tougher
jurisdictions, and so it’s hard to bring those mines on quickly.”
BHP is the world’s biggest copper
producer. CEO Henry said that over the course of the past year, the market had
gone from a slight oversupply to bottlenecks, noting that 12 to 18 months ago
market watchers were expecting 2025 to be “a little bit soft” for the red
metal.
“All it took was a few disruptions at a
few copper mines around the world to all of a sudden send the market into
deficit, and to see copper prices reach record highs,” he said. We’re expecting
that between now and the end of the decade, that crunch is only going to get
tighter.”
Pressed on his expectations for prices,
Henry stressed that predicting price moves is difficult. However, he also
emphasized that a resolution to the supply shortages was not imminent.
“What I can say with a high degree of
confidence is that the market’s tight right now, and it doesn’t take much to
send prices north,” he said, also noting that other metals — including gold and silver — had been on record-breaking
runs this
year.
“Growing attention [on] the broader basket
of commodities could be supportive for copper pricing as well,” Henry said.
More
Copper price: BHP
CEO, investment banks see bull run in 2026
In other news, a Trump “warrior dividend”, or a panic Trump QE to try to head off an early 2026 US recession? If the later, President Trump may get his “one percent or lower” Fed Funds rate but due to the next recession; but that will just add to US dollar debasement. More upward pressure on gold and silver prices.
Troops will receive $1,776 checks before
Christmas, Trump announces
December 18, 2025
President Donald Trump announced
Wednesday that
he would be issuing checks to members of the United States military for $1,776
– in honor of the country’s founding – calling the payment the “Warrior
Dividend.”
“1,450,000 military service members will
receive a special, we call, warrior dividend before Christmas. A warrior
dividend. In honor of our nation’s founding in 1776, we are sending every
soldier $1,776,” Trump said during his televised address to the nation.
“And the checks are already on the way.”
Trump credited tariffs for bringing in
money, though he didn’t say directly how the initiative would be funded.
“We made a lot more money than anybody
thought because of tariffs, and the bill helped us along. Nobody deserves it
more than our military, and I say congratulations to everybody,” Trump said.
Defense Secretary Pete Hegseth directed
the Pentagon to pay out $2.6 billion as a “one-time basic allowance for housing
supplement to all eligible service members in pay grades O-6 and below,” a
senior administration official told CNN.
Roughly 1.28 million Active Component
military members and 174,000 Reserve Component military members will receive
this supplement, the official said. In Trump’s policy agenda that passed over
the summer, Congress appropriated $2.9 billion to the Defense Department, which
the White House has rebranded as the
Department of War,
to supplement the Basic Allowance for Housing entitlement, according to the
official.
“This one-time payment exemplifies the
Department’s ongoing commitment to improving the housing and quality of life
for our military members and their families,” the official said.
CNN has reached out to Treasury Department
for more information on the payments.
Warrior dividend: Trump announces $1,776 bonus for military service members | CNN Politics
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.
Bank
of England lowers rates after tight vote but signals caution about further cuts
December
18, 2025 12:02 PM GMT
LONDON,
Dec 18 (Reuters) - The Bank of England cut interest rates on Thursday after a
narrow vote by policymakers but it signalled that the already gradual pace of
lowering borrowing costs might slow further.
After
a sharp drop in inflation in data this week and a new forecast from BoE staff
that growth will stagnate in late 2025, five Monetary Policy Committee members
voted to lower the BoE's benchmark rate for the fourth time in 2025 to 3.75%
from 4.0%.
The
four other members supported no change as they worried about the potential for
Britain inflation's rate - still the highest among the Group of Seven economies
- to remain too high.
Governor
Andrew Bailey changed his view and voted for a cut, tipping the balance on the
committee.
"We
still think rates are on a gradual path downward," Bailey said in a
statement. "But with every cut we make, how much further we go becomes a
closer call."
He
said he did not yet see proof of a sharper downturn in the jobs market but he
also noted inflation expectations had not dropped significantly so far.
Analysts
polled by Reuters last week had mostly expected a 5-4 vote for a rate
reduction.
The
MPC echoed Bailey's words in its end-of-meeting statement. But some senior
policymakers who voted against the rate cut made clear their worries.
Deputy
Governor Clare Lombardelli said she remained more concerned about the risk of
inflation proving stronger than expected and the recent data had only softened
"at the margin."
Chief
Economist Huw Pill said he saw a bigger risk of inflation getting stuck too
high than too low.
The
quarter-point cut took Bank Rate to its lowest level in nearly three years,
although it is still almost double the equivalent rate of the European Central
Bank.
British
inflation remains higher than among peer economies - in part because of finance
minister Rachel Reeves' decision last year to raise taxes on employers - even
after it fell unexpectedly sharply to 3.2% in data released on Wednesday.
The
BoE said inflation was "now expected to fall back towards target more
quickly in the near term" and the risk that it would persist at high
levels had "become somewhat less pronounced." The possibility of
weaker demand pushing it too low remained, the post-meeting statement said.
Data
on Tuesday showed a weakening jobs market including the highest unemployment
rate since 2021 and a slowdown in private sector pay growth.
The
BoE said it now expected zero economic growth in the last three months of 2025,
down from a forecast of 0.3% growth made as recently as last month, although it
thought underlying growth was stronger at about 0.2% a quarter.
Britain's
economy shrank by 0.1% in the three months to October amid reports that
businesses put investment projects on ice in the run-up to Reeves' budget on
November 26.
The
BoE said it expected the budget would bring down inflation in 2026 by about
half a percentage point due to one-off measures which would then push it up a
bit in the following two years.
The
budget measures would add at most 0.2 percentage points to the size of the
economy in 2026 and 2027.
Other
major central banks are believed to be close to halting their rate cuts - the
U.S. Federal Reserve last week signalled one more in 2026 while the ECB has
probably already come to the end of its monetary loosening cycle.
The
ECB was expected to keep rates on hold later on Thursday.
Bank of England
lowers rates after tight vote but signals caution about further cuts | Reuters
European
Central Bank holds rates steady in last gathering of 2025
Published
Wed, Dec 17 2025 9:10 AM EST Updated 35 Min Ago
Investors
are assessing the last interest-rate decisions of 2025, with four of Europe’s
central banks announcing their monetary policies and macroeconomic outlooks on
Thursday.
The
European Central Bank, Bank of England, Riksbank, and Norges Bank all concluded
meetings today, but only one of them changed its base rate.
European
Central Bank
The
ECB kept rates on hold on Thursday, as widely expected.
Ahead
of the vote, investors were more interested in any commentary on the apparent
growing tensions inside the governing council, with some members, like Isabel
Schnabel, openly endorsing the market’s view that the next rate move will be a
hike, while others think there is still room to cut.
Christian
Kopf, who heads the bond portfolio management of German asset manager Union
Investment, told CNBC: “I don’t expect and rate change in the Euro area for the
time being. If there is a change in 2026, most likely we will get a rate
hike towards the end of 2026 or at the beginning of 2027.”
The
ECB hiked its growth outlook for the euro zone, predicting growth of up to 1.4%
in 2025 and 1.2% in 2026.
Norges
Bank
Norway’s
central bank kept rates on hold at 4% on Thursday, with economists suggesting
the next rate cut might not come until summer 2026. Norges Bank announced its
policy decision at 10 a.m. local time, 9 a.m. London time.
The
bank said
Thursday that
the outlook is uncertain “but if the economy evolves broadly as currently
projected, the policy rate will be reduced further in the course of the coming
year.” For now, however, Norges Bank’s policymakers judged “that a restrictive
monetary policy is still needed. Inflation is still too high.” It
added that its current forecast “is consistent with 1-2 rate cuts next year.”
Morten
Lund, Scandinavia chief economist at JPMorgan, had commented before the rate
hold that the bank’s guidance on Thursday “should be a push-back against
markets’ rising expectations” that it will cut rates in March, which he said
was currently seen as “a coin toss.”
Instead,
JPMorgan expects a rate cut to next take place in June, although Norges Bank
was not, on Thursday, explicit about the timing of a cut.
More
ECB, BOE, Riksbank
and Norges Bank make final calls of 2025
Covid-19
Corner
This
section will continue only occasionally when something of interest occurs.
China files tit-for-tat lawsuit against Missouri for COVID-19 claims
18 December 2025
China launched a counter lawsuit against the U.S. state of Missouri for over $50
billion and an apology from major American news outlets for causing “economic
and reputational threat” with allegations related to the Covid-19 pandemic.
China’s Wuhan city, where
Covid-19 was first detected, mounted the legal challenge after Missouri filed a
lawsuit against China for hoarding personal protective equipment in the early
months of the pandemic.
A federal judge gave a
ruling in favour of Missouri earlier this
year after China declined to
participate in the trial. It called the lawsuit "very absurd" when it
was filed in 2020.
According to court
documents, China’s lawsuit was filed by the municipal government of Wuhan, the
Chinese Academy of Sciences, and the Wuhan Institute of Virology.
The lawsuit accused
Missouri and several U.S. officials of damaging China’s reputation and “soft
power”, particularly that of the Wuhan Institute of Virology.
It named three
defendants, including the state of Missouri, U.S. Senator Eric Schmitt, and
Missouri’s former Attorney General Andrew Bailey.
It alleged that the three
parties “fabricated numerous disinformation”, provided fictional evidence of
losses and slandered various disinformation about China, including that it
obstruct investigation into the origin of the virus, and covered up the information related to the
virus.
It said that politicising
Covid-19 and stigmatising China has caused reputation damage and “profound and
extremely enormous losses” to the plaintiffs.
The lawsuit also accused
the state of “deeply endangering sovereignty, security and development
interests of China” through its “vexatious” litigation.
China is demanding public
apologies in major U.S. and Chinese media outlets, including the New
York Times, CNN, Wall Street Journal, Washington Post,
YouTube and other American media or internet platforms,
It is also demanding
compensation of about $50.5 billion as well as any legal fees which occur, and
the right to claim further compensation.
The three Chinese
plaintiffs were among the defendants in a lawsuit filed five years ago by
Schmitt, then Missouri’s Attorney General, against China, the Chinese Communist
Party, several national ministries and the Hubei provincial government.
The lawsuit alleged that
Chinese officials were to blame for the pandemic.
In 2022, the American
lawsuit took an unusual turn when U.S. District Judge Stephen Limbaugh
initially dismissed the lawsuit, saying Missouri couldn't sue China, its
Communist Party and seven other government or scientific agencies.
But an appeals court
allowed one part of the lawsuit to proceed: the allegation that China hoarded
personal protective equipment, such as respirator masks, medical gowns, and
gloves.
After Chinese officials
didn't respond, Judge Limbaugh accepted Missouri's estimate of past and
potential future damages of more than $8 billion, tripled it as federal law
allows, and added 3.91 percent interest until it's collected.
Last month, Missouri
escalated its efforts to collect, asking the U.S. State Department to formally
notify China that the state intends to pursue assets with full or partial
Chinese government ownership to satisfy the judgment.
Catherine Hanaway, who
inherited the lawsuit when she was appointed state Attorney General, said it
was a “stalling tactic”.
“I find it extremely
telling that the Chinese blame our great state for ‘belittling the social
evaluation’ of The Wuhan Institute of Virology. This lawsuit is a stalling
tactic and tells me that we have been on the right side of this issue all
along,” said Attorney General Hanaway.
“We stand undeterred in
our mission to collect on our $24 billion judgment that was lawfully handed
down in federal court.”
More
China files tit-for-tat lawsuit against Missouri for COVID-19 claims
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.
Exclusive: How
China built its ‘Manhattan Project’ to rival the West in AI chips
December 18, 2025 4:11 AM GMT
SINGAPORE, Dec 17 (Reuters) - In a
high-security Shenzhen laboratory, Chinese scientists have built what
Washington has spent years trying to prevent: a prototype of a machine capable
of producing the cutting-edge semiconductor chips that power artificial
intelligence, smartphones and weapons central to Western military dominance,
Reuters has learned.
Completed in early 2025 and now
undergoing testing, the prototype fills nearly an entire factory floor. It was
built by a team of former engineers from Dutch semiconductor giant ASML (ASML.AS), opens new tab who
reverse-engineered the company's extreme ultraviolet lithography machines or
EUVs, according to two people with knowledge of the project
EUV machines sit at the heart of a
technological Cold War. They use beams of extreme ultraviolet light to etch
circuits thousands of times thinner than a human hair onto silicon wafers,
currently a capability monopolized by the West. The smaller the circuits, the
more powerful the chips.
China's machine is operational and
successfully generating extreme ultraviolet light, but has not yet produced
working chips, the people said.
In April, ASML CEO Christophe Fouquet
said that China would need "many, many years" to develop such
technology. But the existence of this prototype, reported by Reuters for the
first time, suggests China may be years closer to achieving semiconductor
independence than analysts anticipated.
Nevertheless, China still faces major
technical challenges, particularly in replicating the precision optical systems
that Western suppliers produce.
The availability of parts from older
ASML machines on secondary markets has allowed China to build a domestic
prototype, with the government setting a goal of producing working chips on the
prototype by 2028, according to the two people.
But those close to the project say a
more realistic target is 2030, which is still years earlier than the decade
that analysts believed it would take China to match the West on chips.
Chinese authorities did not respond to
requests for comment.
The breakthrough marks the culmination
of a six-year government initiative to achieve semiconductor self-sufficiency,
one of President Xi Jinping's highest priorities. While China's semiconductor
goals have been public, the Shenzhen EUV project has been conducted in secret,
according to the people.
The project falls under the country's
semiconductor strategy, which state media has identified as being run by Xi
Jinping confidant Ding Xuexiang, who heads the Communist Party's Central
Science and Technology Commission.
Chinese electronics giant Huawei plays a
key role coordinating a web of companies and state research institutes across
the country involving thousands of engineers, according to the two people and a
third source.
The people described it as China's
version of the Manhattan Project, the U.S. wartime effort to develop the atomic
bomb.
“The aim is for China to eventually be
able to make advanced chips on machines that are entirely China-made,” one of
the people said. "China wants the United States 100% kicked out of its
supply chains."
Huawei, the State Council of China, the
Chinese Embassy in Washington, and China's Ministry of Industry and Information
Technology did not respond to requests for comment.
Until now, only one company has mastered
EUV technology: ASML, headquartered in Veldhoven, Netherlands. Its machines,
which cost around $250 million, are indispensable for manufacturing the most
advanced chips designed by companies like Nvidia and AMD—and produced by
chipmakers such as TSMC, Intel, and Samsung.
More
Exclusive: How China built its ‘Manhattan Project’ to rival the West in
AI chips | Reuters
Next, the
world global debt clock. Nations debts to GDP compared.
World Debt Clocks
(usdebtclock.org)
Another
weekend and the last weekend before Christmas. Have a great weekend everyone.
Tomorrow,
how Admiral Nelson defeated Napoleon’s fleet at the Battle of the Nile,
trapping Napoleon and his army in the sands of Egypt.
What our generation has forgotten is that the system of private
property is the most important guarantee of freedom, not only for those who own
property, but scarcely less for those who do not. It is only because the
control of the means of production is divided among many people acting
independently that nobody has complete power over us, that we as individuals
can decide what to do with ourselves.
Friedrich August von Hayek
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