Tag: news

The economic recovery narrative got a solid boost this morning following the latest Eurozone flash PMIs which surged for a second month, beating expectations across the board.

After a record monthly improvement in May, the Euro area composite PMI rebounded further by 15.6pt to 47.5 in June—above expectations—consistent with a further easing of lockdown measures and the improvements in high-frequency activity indicators.

The recovery was broad-based across sectors but slightly stronger in the services PMI. The German and French composite PMIs also registered larger-than-expected increases, especially the latter, which would be consistent with stronger sequential growth but from a more depressed base.

Here are the key numbers (the responses were collected between 12 and 22 June)

• Euro Area Composite PMI (June, Flash): 47.5, beat consensus 43.0, last 31.9.
• Euro Area Manufacturing PMI (June, Flash) 46.9: beat consensus 45.0, last 39.4.
• Euro Area Services PMI (June, Flash): 47.3, beat consensus 41.5, last 30.5.
• Germany Composite PMI (June, Flash): 45.8, beat consensus 44.4, last 32.3.
• France Composite PMI (June, Flash): 51.3, beat consensus 46.8, last 32.1.

Overall, the June PMIs—despite several indices remaining below 50—are indicative of a continued recovery in economic activity across the Euro area given the nature of their empirical relationship with ‘hard’ measures of activity such as GDP.

Key Highlights from Goldman:

1. After a record monthly improvement in May, the Euro area composite PMI rebounded further by 15.6pt to 47.5 in June, above expectations. Around four-fifths of the increase were driven by a sequentially stronger services PMI (up 16.8pt), which has a larger weight in the overall index, with the remaining contribution due to an increase in the manufacturing output subindex (up 12.6pt).

The improvements in the PMIs from May are consistent with a further easing of lockdown measures across the Euro area in June and high-frequency activity indicators, which have continued to improve since May. The rebound in the combined Franco-German composite PMI was only 0.2pt stronger than that in the composite PMI related to the rest of the Euro area, suggesting a notable recovery in the Italian and Spanish PMIs as well. The new orders subindices saw equally sized strong increases on the month across both sectors (up 15.8pt), driven primarily by a continued recovery in domestic demand.

The pace of job creation was sequentially less weak than in June, but saw a smaller improvement than headline activity in either sector. Despite a continued recovery in demand, the subindex measuring suppliers’ delivery times suggests they shortened in June—in normal times, they would have likely lengthened as orders increase—suggesting that factory reopenings and production restarts have continued to alleviate the pressure on supply chains. Expectations of 12-month-ahead output continued to rise from the record April low, but remain below their historical average at the area-wide level, as well as in Germany and France.

2. Although the Euro area PMIs (as well as those in Germany) remain below the expansionary mark of 50, they are nonetheless consistent with a continued recovery in activity. Despite the PMI questionnaire asking about monthly changes in activity, Goldman argues that the empirical evidence suggests that the PMIs are much more informative about growth in activity on a rolling, multi-month basis (such as average growth over the past 3 months, or longer). Therefore, as the area-wide ‘run-rate’ of activity in June remains depressed and its growth contractionary on a sufficiently long rolling, multi-month basis (after the sharp contractions over March and April), the PMI values empirically consistent with that are below 50. June PMI readings above 50 in France—unlike in Germany —are consistent with stronger sequential growth but from a more depressed base.

Overall, the May and June PMIs are indicative of a significant recovery in activity from the April trough across the Euro area. Still, given the uncertainty around mapping the composite PMIs into GDP—with the PMIs omitting significant parts of the economy such as construction, wholesale and retail trade, and non-market services, and having a non-linear relationship with GDP at business cycle extremes—Goldman left its growth forecasts for Q2 unchanged, which embed a significant near-term recovery over May and June.

3. The German composite PMI increased by 13.5pt to 45.8 in June, somewhat above expectations. This reflected similarly sized increases in the manufacturing output subindex (up 14.2pt) and the services PMI (up 13.2pt), with both reaching the same level in June as the composite PMI of 45.8. The increase in the headline manufacturing PMI was smaller (up 7.9pt) as its subcomponents other than output and new orders saw smaller increases. The manufacturing new orders subindex increased much more sharply than in May (up 17.6pt), with a similarly sized increase in new export orders. The sequential monthly improvement in new business in the service sector was also sizeable, albeit slower than in May. That said, the press release noted that “there were reports of coronavirus-related uncertainty continuing to weigh on demand and leading to contract postponements or cancellations”. The improvements in the respective employment subindexes were more moderate than those in headline activity, especially in the manufacturing sector. Suppliers’ delivery times notably shortened further, suggesting that supply chains are being restored after significant impairments due to factory closures.

4. After a 21-point increase in May from the record low in April, the French composite PMI saw a further sharp increase in June, by 19.2pt to 51.3—significantly above expectations. This reflected equally sized increases of 19.2pt in both the manufacturing output and services PMIs. The improvements in the June PMIs are consistent with the significant further easing of lockdown measures in France over June—with all of France now marked as a ‘green zone’—as well as high-frequency activity indicators, which have continued to improve into June. The new orders subindex increased more strongly than in May across both sectors, in contrast to the new export orders subindex, which rose, but to a lesser extent, consistent with a recovery primarily driven by stronger domestic demand. Relatedly, the press release noted that respondents “mentioned fewer orders from the US, China and Europe” due to the COVID-19 pandemic. The employment subindex was stronger than in May, but increased more modestly than headline activity. Suppliers’ delivery times remain abnormally long given the still very subdued levels of activity, indicating remaining impairments to supply chains. As its subcomponents other than output and new orders saw smaller increases, the headline manufacturing index rose by 11.5pt, less than the 18-19pt increases in manufacturing output and new orders.

After decades of widespread use as company scientists played down research showing a definitive link between the product and growing rates of non-Hodgkins lymphoma, Monsanto parent company Bayer has agreed to pay up to $10 billion to settle claims that glyphosate, the active ingredient in Roundup, causes cancer.

Citing people familiar with the matter, German newspaper Handelsblatt reported that the company has agreed to settle tens of thousands of glyphosate-related lawsuits in the US for between $8 billion to $10 billion.

Of that number, $2 billion is considered a “reserve” which can be used to settle future claims.

The rest will be used to settle all of the lawsuits pending in the United States from users of the controversial weed killer, the number of active lawsuits against the Roundup purveyor recently numbered more than 50k.

Talks for an out of court settlement have been ongoing since last summer.

Last year, scientists evaluated a batch of existing studies and determined that Monsanto’s ubiquitous weed-killer Roundup and its active ingredient glyphosate increased cancer risk of non-Hodgkin lymphoma (NHL) by 41%, according to a research published in February 2019. Back in 2018, a San Francisco Jury awarded $289 million in damages to a former school groundskeeper, Dewayne Johnson, who said Monsanto’s Roundup weedkiller gave him terminal cancer. That award consisted of $40 million in compensatory damages and $250 million in punitive damages.

Bayer inherited the glyphosate problems during its $60 billion acquisition of Monsanto. After losing three lawsuits and getting stuck with high damages judgments pertaining to risks with the weed killer, Bayer changed its strategy and abandoned its aggressive defense in favor of trying to negotiate a sweeping settlement of the tens of thousands of US lawsuits pending. Analysts had feared the settlement could cost as much as €20 billion, which is roughly double the final amount, which should be a positive for the company’s shares.

So far, science has not been able to conclusively clarify whether glyphosate is carcinogenic or not. Bayer holds numerous studies against the classification of the IARC and other researchers. The US environmental agency EPA supports the group and, despite the heated debate about glyphosate, has so far maintained that the controversial pesticide poses no health risk to people if used properly.

German police have reportedly taken former Wirecard CEO Markus Braun into custody after the former wunderkind executive’s house of cards finally came crashing down after WC finally acknowledged that more than $2 billion in cash missing from its balance sheet will likely never be found.

Markus Braun

Following reports that prosecutors were preparing to make an arrest, Braun, who resigned last week, turned himself in Monday evening in Munich as officials prepare to bring charges against Wirecard for its brazen financial fraud.

Prosecutors said in an e-mailed statement that a judge will review whether he can be kept in custody.

The troubled payment processor – shares of which are steadily making their way toward zero – said it’s in discussions with creditors and is considering a “full-scale restructuring” after pulling its financial results and acknowledging that the missing billions will never be found.

Of course, Braun clearly deserves his comeuppance: Over the last decade, Wirecard has aggressively pursued journalists and analysts brave enough to go public with allegations of fraud and accounting abuses. Those claims turned out to be true, but not before Germany’s financial regulator, BaFin, outlawed short-selling of Wirecard shares and even pursued a journalist from the FT that published an extensive investigation into fraud at the company which was eventually proven correct – but not before BaFin tarnished the reputation of the reporter – the FT’s Dan McCrum – before he was eventually vindicated, per BBG.

One legal commentator told BBG that the situation couldn’t have been worse for Wirecard and Braun. A different lawyer described the scandal as “the biggest accounting fraud in Germany”.

“It’s a brutal development – it could hardly have turned out worse,” Oliver Kipper, a defense lawyer who isn’t involved in the case, said before Braun’s arrest. “You should know what happened to 1.9 billion euros of assets you have listed in your books.”

Even BaFin is too shell-shocked to apologize: “It’s a complete disaster we’re looking at,” said Felix Hufeld, head of BaFin, Germany’s top financial regulator, at a panel discussion Monday. “It’s a shame that something like that happened.”

Munich prosecutors accused Braun of inflating Wirecard’s balance sheet and sales volume by feigning income from transactions with so-called third-party acquirers, possibly in cooperation with other perpetrators. Neither the company nor Braun commented on the arrest to the American press.

Authored by Tom Luongo via The Strategic Culture Foundation,

The rate at which events are accelerating makes prediction a fool’s game. But I’ll take a shot at it, since I’ve been called a heck of a lot worse than ‘fool’ in my life.

Since the rioting began after the death of George Floyd it’s been obvious to anyone with any experience in covering global politics that these have been a directed operation aimed at undermining the presidency of Donald Trump here in the U.S.

The formation of the Capitol Hill Autonomous Zone (CHAZ) in downtown Seattle is the latest in a series of provocations and escalations intended to goad Trump into invoking the Insurrection Act of 1878 and deploying the military to put down these riots endlessly promoted by a complicit media in the West as mostly ‘peaceful protests.’

They are anything but that.

This is a situation that, because of the subsidization of it by the Mayor, Jenny Durkan, and the Governor, Jay Inslee, that will persist just long enough to descend into violence and chaos. Note how I don’t use the word anarchy.

Because we’ve already seen a form of government form in the CHAZ, with a governing council, a constitution of sorts and decrees of white people paying reparations to black members of the community.

Raz Simone, like a latter day Issac Hayes – the Duke — from John Carpenter’s now prophetic Escape from New York, is passing out AR-15s and AK-47s to keep the peace of the gun. And in no time some pigs will become far more equal than others.

But, even if my worst predictions about the CHAZ do not come to pass, since it is very much a tactical operation in the grander strategy to undermine and delegitimize Trump, there will still likely be violence.

All we have to do is look at what happened in other so-called color revolutions that piggy-backed on legitimate protests against existing, corrupt governments.

This reminds me of the situation in Ukraine in 2014 where the protests on the Maidan plaza in Kiev turned violent when snipers began shooting from rooftops. And to this day there are questions as to who shot who and what actually happened.

But given that a peaceful stability in the CHAZ serves no one in power, on either side of the political divide, the likelihood of a similar provocation is very, very high.

The way I see this, the people in the CHAZ are pawns in a much larger game being played by the power elite many of them want to overthrow.

All it takes is one agent provocateur, one guy with a rifle and a narrative springs into being.

If there is one thing that is abundantly clear after four years of watching this escalation in the U.S. it is that there is nothing Trump’s enemies won’t do to make things worse.

Because, in the end, this is about far more than Trump. This is about moving the U.S. into a failed political and economic state. The economic destruction is already well underway thanks to the persistence of the COVID-19 insanity.

The new normal of face masks and social distancing highlight the sheer cowardice of the corporate managerial class and the complicity of the corporate leadership, as The Saker pointed out in a recent post. He asks the question that if money isn’t the object of this corporate ‘bowing to the mob’ what is at stake.

The answer, of course, is power:

Specifically, the U.S. deep state – at a major faction within that deep state – is clearly desperate to get rid of Trump (and *not* for the right reasons, of which there are plenty).

There are plenty of signs that illustrate that Trump is even losing control of the Executive, including Secretary Esper contradicting Trump on what is a key issue – restoring law and order – or the U.S. Ambassador to South Korea voicing support for BLM (I consider that these actions by top officials against their own Commander in Chief border on treason). Needless to say, the pro-Dems neo-libs at Slate immediately began dreaming about, and calling for, a military revolt against Trump.

And that new normal now separates Americans along yet another vector, one much subtler than wearing a MAGA hat or sporting a ‘Coexist’ bumper sticker on their hybrid.

And that’s exactly why I think there’s going to be some kind of Maidan-like event in the CHAZ if President Trump continues to refuse to take the bait and roll the tanks in, metaphorically, to break it up.

But, ultimately, this isn’t Trump’s job, it is the job of the local elected officials to provide services to protect the property and livelihoods of their constituents. But that’s not what’s on display in Seattle.

It isn’t on display in New York City either where Mayor Bill DeBlasio is doing everything he can to disarm and delegitimize his own police force and enflame tensions by allowing looters to run wild while enforcing social distancing rules against Hasidic Jews trying to worship in peace.

This is a movie whose ending I’ve seen before and I didn’t like it the previous times I watched it. What’s sad is that the people who’ve released this one are the same ones who released the previous ones.

It’s a tragedy which, frankly, as I’ve talked about ad nauseum. Trump has invited this onto himself because of his own weakness to confront his attackers while engaging in similar behavior against countries he doesn’t like – Syria, Lebanon, Iran, Iraq, Libya, Venezuela.

No one in the international community will shed one tear if Trump is deposed in November or during his second term. Many of us Americans recognize his faults and what they’ve wrought but still understand that the alternative to him is the restoration of the worst parts of the Empire.

His only true accomplishment to date has been staying in power in a White House where his power has steadily eroded to the point of near irrelevancy. If he doesn’t make substantive moves to neutralize those behind the CHAZ he will be the one blamed when it explodes.

Another day, another article where we reach the inevitable conclusion of being absolutely dumbfounded that the NHTSA and the NTSB still allow Tesla vehicles on the road.

And, another accident scene…

Today’s report comes from Germany, where according to FP, three women are now dead after a Tesla reportedly drove into oncoming traffic and collided head-on with another vehicle. The driver of the Tesla and her two children were only “slightly injured” but the car they hit had all 3 of its occupants killed. 

An investigation into the cause of the accident is ongoing, despite some on social media reporting that the Tesla “veered left” and the report noting that the Tesla drove into oncoming traffic. 

Die Frau war mit ihren beiden ein und drei Jahre alten Kindern auf dem Autobahnzubringer unterwegs, als der Wagen auf die Gegenfahrbahn geriet und dort mit dem Seat zusammenstieß. Beide Fahrzeuge wurden in den Seitengraben geschleudert. Die Mutter und ihre beiden Kinder wurden leicht verletzt.

Others online have speculated online that the crash may have been caused by Autopilot, which may have had trouble with the road’s lines. You can see there are two solid lines on the road, as well as dotted lane dividers. 

You can see why the autopilot was confused by the 2 lines… This is horrible, i dont care about losing money, but helplessly watching this f*cker kill people is breaking my heart. https://t.co/aAokonRTw1 pic.twitter.com/uvnHtKxxVF

— Realist (@TeslaAgnostic) June 21, 2020

Meanwhile, a German court recently ruled that Tesla’s use of the term “Autopilot” is misleading. The ruling, unfortunately, came too late for the three killed over the weekend. 

Video from the scene of the accident can be seen here:

 

Prices for salmon are poised to continue their two-week slide, with exporters facing stockpiles of salmon from the double-whammy of large harvests and negative press from both China and Germany…

As Intrafish.com reports, the recovery in Norway’s farmed salmon prices earlier this spring has been all but wiped out.

Average prices are rapidly moving toward the NOK 50 ($5.22/€4.66) per kilo mark, according to executives in the salmon farming sector.

“We’re sitting on a lot of fish,” one exporter said.

“This is extremely serious for exporters, and overall a sad situation. We’re losing millions.”

One farmer said the market is bracing itself for turbulence.

“We’ll have to take both the ups and downs,” one farmer said.

Another farmer agreed that the market is erratic given not just the China challenges, but also currency fluctuations.

The media loves a good food scare and this week it was brought uncomfortably close to home for the seafood sector when farmed salmon became the target of Chinese media attention after its alleged link to a new outbreak of the coronavirus from a Beijing wet market.

As Intrafish.com notes, unfortunately for the global seafood sector, few countries react in quite the dramatic way China does when it comes to consumer-product related risks.

Artistic licence: Salmon is depicted floating over giant coronavirus virions in a Chinese news story. Photo: IntraFish

Think China doesn’t care about food safety?

There is a common misconception that China is unconcerned with food safety. While images of wet markets — often pinpointing the most rural examples, with cages of pangolins, cats and dogs — have been prevalent in the press and give the impression of a lack of caution, the reality is far different.

Those images reinforce the offensive stereotype of Chinese consumers somehow being willing to eat anything, when the fact is, Chinese consumers are extremely focused on food safety. The country has a history of terrifying food-related crises, with unscrupulous manufacturers and foodservice operators taking advantage of a lack of enforced regulation. Just do a search for melamine-tainted milk, fake bottled water or sewer oil and you will get a taste of what it is like to live in the head of a Chinese consumer and why food scares leave a lasting bad taste in the mouth.

There’s never been a better time for Chinese journalists to do a little ‘farmed salmon’ internet searching and drag out the good old sealice pictures. Photo: IntraFish

So when a chopping board in a Beijing wet market shows traces of a virus that has killed 450,000 people in the last six months and the product last on that board was a piece of salmon, it is no wonder that fear and a need to urgently remove any possible risk is the first reaction.

After all, there is enough past evidence of far worse breaches of food safety to want to avoid any kind of risk, proven or otherwise.

Not just China…

And while it is easy enough to shrug off a couple of bad headlines in the Chinese press, we’re in a global information age, and already plenty of mainstream Western publications have picked up the story, from Bloomberg to Fortune to The New York Times, and the headlines are a variation on a theme: coronavirus linked to salmon.

Trending, for exactly the wrong reasons…

Google Trends, which tracks search terms across the globe on Google.com, offers a stark look at what happens with a media scare.

Just last week, the terms “salmon coronavirus” “salmon covid” and “三文鱼” — the Mandarin characters for salmon — were just a blip on the search radar, dwarfed by terms such as “cat memes.”

But last Friday as news of the chopping board discovery spread like wildfire, those searches surged, with consumers both in and out of China desperate for clarification in a time of extreme paranoia and fear.

While many news sources attempt to dispel fear around the product, it seems likely that by the very association, the damage has been done. And if Rabobank consumer foods analyst Michelle Huang is correct, it could be two to three years before confidence in the product – in what was previously thought to be a huge potential market – is restored.