Baltic Dry Index. 1760 +13 Brent Crude 72.55
John Kenneth Galbraith. The Great Crash: 1929.
Run, do not walk to the lifeboats. This
summer our insane trade and currency wars are about to go spectacularly wrong.
In our Mad, Mad, Mad, Mad new trade war world,
Trumponomics seems to want to try testing 25 percent tariffs on China, at the
same time as global interest rates are rising, with Japan tightening slightly earlier
today, and the BOE due to raise their key interest rate by a ¼ percent about
noon BST today. Nothing good lies at the end of this insane road.
We are now playing Russian roulette with two
loaded chambers. Time to join China and Russia in adding a little more
insurance in 100 percent paid up physical gold.
Nothing is so admirable in politics as a short memory.
John Kenneth Galbraith.
August 2, 2018 / 2:03 AM
Asian shares slide on fresh trade worries, bonds fragile
TOKYO (Reuters) - Asian stocks dropped on Thursday as the latest escalation in the Sino-U.S. trade war hit Chinese shares, while global bond markets were rattled by increased borrowing by Washington and Japan’s new tolerance for higher yields.
MSCI’s broadest index of Asia-Pacific shares outside Japan dropped 0.8
percent, dragged down by a 1.2 percent fall in Chinese H-shares. Japan’s Nikkei
declined 0.4 percent.
The CSI 300 index of China’s A-shares dropped 1.4 percent to three-week
lows, extending falls from a July 24 high to 5.5 percent.
The U.S. administration on Wednesday increased pressure on China for
trade concessions by proposing a higher 25 percent tariff on $200 billion worth
of Chinese imports.
“If it had not been for the sideswipe on trade, markets would have been
in much better shape this week. Apple’s earnings were super, helping to quell
concerns about high-tech companies,” said Hirokazu Kabeya, chief global
strategist at Daiwa Securities.
----MSCI’s gauge of stocks across the globe is down 0.45 percent so far this week, reversing gains from the previous four weeks, with Chinese shares accounting for the bulk of that.
On Wall Street, the S&P 500 lost 0.10 percent on Wednesday, but the
Nasdaq Composite added 0.46 percent to extend its recovery from Monday’s
three-week low.
While industrial stocks fell 1.3 percent on trade worries, technology
shares were boosted by strong earnings from Apple.
The world’s largest company by market capitalization rose 5.9 percent,
boosting its value to close to $1 trillion.
The Federal Reserve kept interest rates unchanged on Wednesday, as
expected, characterizing the U.S. economy as strong and staying on track to
increase borrowing costs in September and likely again in December.
While that surprised nobody, U.S. bond yields rose, with the benchmark
10-year yields breaking above 3 percent to 2-1/2-month highs, after the U.S.
Treasury said it would boost borrowing in the bond market in the coming
quarter.
More
August 1, 2018 / 9:38 PM
Trump administration adds to China trade pressure with higher tariff plan
WASHINGTON/BEIJING (Reuters) - U.S. President Donald Trump sought to
ratchet up pressure on China for trade concessions by proposing a higher 25
percent tariff on $200 billion worth of Chinese imports, his administration
said on Wednesday.
U.S. Trade Representative Robert Lighthizer said Trump directed the
increase from a previously proposed 10 percent duty because China has refused
to meet U.S. demands and has imposed retaliatory tariffs on U.S. goods.
“The increase in the possible rate of the additional duty is intended to
provide the administration with additional options to encourage China to change
its harmful policies and behavior and adopt policies that will lead to fairer
markets and prosperity for all of our citizens,” Lighthizer said in a
statement.
There
have been no formal talks between Washington and Beijing for weeks over Trump’s
demands that China make fundamental changes to its policies on intellectual
property protection, technology transfers and subsidies for high technology
industries.
----Derek Scissors, a China scholar at the American Enterprise Institute in Washington, said a 25 percent tariff rate is more likely to shut out Chinese products and shift American supply chains to other countries, as a 10 percent duty could be offset by government subsidies and weakness in China’s yuan currency.
“If we’re going to use tariffs, this gives us more flexibility and it’s
a more meaningful threat,” he said, adding that Trump’s pressure strategy will
not work if he does not resolve trade disputes with U.S. allies such as the
European Union, Mexico and Canada.
But the move drew swift condemnation from U.S. business lobby groups
worried that tit-for-tat tariffs would start to hamper economic growth.
“Escalating tariffs against China is the wrong approach to address
legitimate concerns U.S. businesses have with China’s harmful practices,” said
Myron Brilliant, head of international affairs for the U.S. Chamber of
Commerce.
More
Fed Leaves Key Rate Unchanged With Economy Growing at ‘Strong Rate’
By Craig Torres
Updated on 1 August 2018, 21:31 GMT+1
Federal Reserve officials left U.S. interest rates unchanged and stuck with
a plan to gradually lift borrowing costs amid “strong” growth that backs bets
for a hike in September.Economic activity has been “rising at a strong rate,” and unemployment “has stayed low,” the Federal Open Market Committee said Wednesday in a statement released in Washington. “Household spending and business fixed investment have grown strongly.”
While leaving rates on hold as expected, the committee repeated guidance for “further gradual increases” in its policy benchmark, lining up September’s FOMC meeting for the third hike of the year.
----Stocks and bonds shrugged off the Fed announcement, with the Standard & Poor’s 500 Index closing down 0.1 percent and the 10-year Treasury yield at 3 percent at 4 p.m. New York time. Odds for a rate hike at the central bank’s Sept. 25-26 meeting held around 80 percent.
“The FOMC did nothing to the statement that would suggest a lower
likelihood of a September hike,” said former Fed Governor Laurence Meyer, who
runs a policy research firm in Washington. “The market has now priced a
September rate hike as a near-certainty, and we agree with that assessment.”
Fed Chairman Jerome Powell is trying to nurture the second longest U.S.
expansion on record by slowly reducing the amount of support that monetary
policy provides to growth. The economy is riding a tailwind from tax cuts and
higher federal spending, though a trade war threatens to dent growth.
More
August 2, 2018 / 12:18 AM
Bank of England poised to raise rates in the face of Brexit risk
LONDON (Reuters) - The Bank of England looks set
to raise interest rates on Thursday to their highest level since the financial
crisis almost a decade ago, defying warnings that it is taking a gamble ahead
of Brexit, the terms of which remain unclear.
The world’s fifth-biggest economy has slowed since the referendum
decision in June 2016 to leave the European Union.
And with less than eight months until it leaves the bloc, London and
Brussels — as well as key members of Prime Minister Theresa May’s Conservative
Party — remain far apart on what the future trading relationship should look
like.
But BoE Governor Mark Carney says that even if Britain’s economy is
growing only modestly, it risks overheating unless borrowing costs rise from
their crisis-era emergency lows, something the central bank began in November
with its first rate hike in more than 10 years.
All bets on where BoE rates are headed will be off, however, if Britain
fails to get a Brexit deal, Carney has said.
Several economists have challenged the need for a rate hike now, given
not only the Brexit risks but also the potential damper on global growth from
U.S. President Donald Trump’s tariffs on imports, and counter-moves by other
countries.
More
"Indeed the temporary breaks in the market which preceded the crash were a serious trial for those who had declined fantasy. Early in 1928, in June, in December, and in February and March of 1929 it seemed that the end had come. On various of these occasions the [New York] Times happily reported the return to reality. And then the market took flight again. Only a durable sense of doom could survive such discouragement. The time was coming when the optimists would reap a rich harvest of discredit. But it has long since been forgotten that for many months those who resisted reassurance were similarly, if less permanently discredited.”
J. K. Galbraith. The Great Crash: 1929.
Crooks and Scoundrels Corner
The bent, the seriously bent, and the totally doubled over.
Below, what could possibly go right?
August 2, 2018 / 4:31 AM
Trump's overture to emerging Asia drowned out by trade war
SINGAPORE (Reuters) - When the U.S. Secretary of State flies into
Southeast Asia this week with a new investment pitch for the region, the
response could be: thanks a million, but please stop threatening a trade war
with China that will make us lose billions of dollars.
Analysts say the $113 million of technology, energy and infrastructure
initiatives trumpeted by Mike Pompeo earlier this week - the first concrete
details of U.S. President Donald Trump’s vague ‘Indo-Pacific’ policy - may be
hard to sell to countries that form an integral part of Chinese exporters’
supply chains.
It may even further inflame tensions with Beijing, which has been
spreading money and influence across the region via its Belt and Road
Initiative development scheme.
“The Southeast Asian capitals are more worried about any blowback
effects for them of U.S.-China trade tension than they are about how much they
can benefit from this $113 million initiative,” said Malcolm Cook, senior
fellow at the Institute of Southeast Asian Studies in Singapore.
“Pompeo has a hard selling job. There is still no real positive trade
story for Asia coming out of the United States.”
Hot on the heels of Washington’s new economic plan for emerging Asia
came reports the United States could more than double planned tariffs on $200
billion of imported Chinese goods from dog food to building materials. China
called it “blackmail” and vowed retaliation.
After a brief meeting with new Malaysian Prime Minister Mahathir Mohamad
in Kuala Lumpur, Pompeo will fly to Singapore - a global trading hub that could
be one of the hardest-hit in the region by a trade war - for a sit-down with
the 10-member Association of Southeast Asian Nations (ASEAN) on Friday.
Singapore’s biggest bank, DBS, estimates that a full-scale trade war -
defined as 15-25 percent tariffs on all products traded between the U.S. and
China - could more than halve Singapore’s growth rate next year from a forecast
2.7 percent to 1.2 percent. Malaysia’s growth rate in 2019 could fall from an
estimated 5 percent to 3.7 percent.
More
August 1, 2018 / 2:17 AM
China vows retaliation if Trump slaps 25 percent tariff on $200 billion of Chinese imports
BEIJING/WASHINGTON
(Reuters) - China said on Wednesday that “blackmail” wouldn’t work and that it
would hit back if the United States takes further steps hindering trade, as the
Trump administration considers slapping a 25 percent tariff on $200 billion
(£152.5 billion) worth of Chinese goods.
The proposal would increase the potential tariff rate from 10 percent
the administration had initially put forward on July 10 for that wave of duties
in a bid to pressure Beijing into making trade concessions, a source familiar
with the plan said on Tuesday.
The tariffs target thousands of Chinese imports, including food
products, chemicals, steel and aluminium and consumer goods ranging from dog
food, furniture and carpets to car tires, bicycles, and baseball gloves and
beauty products.
While the duties would not be imposed until after a period of public
comment, raising the proposed level to 25 percent would escalate the already
bitter trade dispute between the world’s two biggest economies.
---- China, which has accused the United States of bullying, again vowed to retaliate if Trump proceeds with the measures, warning that pressure tactics would fail.
“U.S. pressure and blackmail won’t have an effect. If the United States
takes further escalatory steps, China will inevitably take countermeasures and
we will resolutely protect our legitimate rights,” Chinese Foreign Ministry
spokesman Geng Shuang told a regular news briefing.
Investors fear an escalating trade war between Washington and Beijing
could hit global growth, and prominent U.S. business groups, while weary of
what they see as China’s mercantilist trade practices, have condemned Trump’s
aggressive tariffs.
Representatives of U.S. Treasury Secretary Steven Mnuchin and Chinese
Vice Premier Liu He have been speaking privately as they seek to restart
negotiations to defuse the budding trade war, Bloomberg reported, citing
sources.
More
If all
else fails, immortality can always be assured by spectacular error.
John Kenneth
Galbraith.
Technology Update.
With events happening fast in the
development of solar power and graphene, I’ve added this section. Updates as
they get reported. Is converting sunlight to usable cheap AC or DC energy
mankind’s future from the 21st century onwards?
The Global Race to Build the
World’s Biggest Battery
A new “biggest battery” is announced every month. Which one rules?
Jason DeignAugust 01, 2018
Elon Musk sparked a competition for the world’s biggest battery.
Ever since Tesla completed the 129-megawatt-hour Hornsdale Power Reserve battery plant after Musk’s high-profile Twitter bet, others have been looking to beat it.This summer, for instance, saw two “world’s biggest battery” announcements coming out within days of each other. Given different commissioning dates, both might actually claim the prize for a while.
But which country will ultimately end up with the biggest battery?
Here is a rundown of the top contenders, based on announcements made to date.
South Korea
LS Industrial Systems (LSIS) and Macquarie Capital Korea have won the contract to build and operate a 175-megawatt-hour battery storage system across five sites owned by SeAH, a steel conglomerate, LSIS announced in July.LSIS did not give a commissioning date for the energy storage project but said it would be used to save cheap nighttime electricity for use in the daytime, creating savings of around KRW 130 billion (USD $116 million) over 15 years.
United Kingdom
The U.K. bagged a new national record for battery size in July with the opening of Stocking Pelham, a 50-megawatt-hour facility containing 150,000 lithium-ion cells.However, the SMA Sunbelt Energy-owned installation could be dwarfed if plans for a 350-megawatt-hour battery system move forward in Graveney, near Kent in southeast England.
The battery is due to serve a 300-megawatt solar plant proposed by Hive Energy and Wirsol Energy. But both projects face significant opposition from campaigners concerned about their impact on nearby marshland ecosystems.
Australia
Despite worries that Hornsdale may have killed the business case for other big batteries in the market, Australia seems keen to stay at the forefront of massive battery development.In March, GTM revealed that a British businessman, Sanjeev Gupta, plans to build a 120-megawatt, 140-megawatt-hour battery complex in the same region where Tesla completed its Hornsdale plant late last year.
And in May, Reuters reported that a consortium including JERA of Japan, Australian developer Lyon Group and battery provider Fluence was planning to develop a 400-megawatt-hour storage system in South Australia. Construction could begin “within months,” Reuters said.
Germany
As previously reported in GTM, German engineers are working on a city-scale energy storage system that could boast a capacity of up to 120 megawatts and 700 megawatt-hours, said to be enough to power Berlin for an hour.Unlike other planned big batteries, the project being led by gas storage firm EWE Gasspeicher would not rely on cheap lithium-ion technology but would instead fill 100,000 cubic meters of salt caverns with brine to create a massive redox flow battery.
The experimental nature of the project means the technology, dubbed brine4power, will likely not achieve full commercial scale until 2023.
United States
Morehttps://www.greentechmedia.com/articles/read/the-global-race-to-build-the-worlds-biggest-battery#gs.=5s32io
You
will find that the State is the kind of organization which, though it does big
things badly, does small things badly, too.
John Kenneth
Galbraith.
The monthly Coppock Indicators finished July.
DJIA: 25,415 +213 Down. NASDAQ:
7,672 +259 Down. SP500: 2,816 +166 Down.
All
three slow indicators moved down in March and have continued down ever since.
For some a new bear signal, for others a take profits and get back to cash
signal.
