25 February 2021

1) Nikola Corp. announced that its long-range fuel-cell semi truck gets as much as 900 miles on a tank of hydrogen gas, and is due to come out in 2024. The Nikola Two fuel-cell vehicle would go at least 750 miles on a tank of hydrogen, while its Tre shorter-range fuel-cell truck, can run 500 miles, and remains on schedule to start production in the second half of 2023. Nikola said that their first Tre FCEV prototypes are scheduled to begin assembly in Arizona and Ulm, Germany, in the second quarter of this year and that testing and validation would continue into 2022. The Nikola 900-mile truck will have a sleeping cabin for drivers and a new chassis designed for North American highways.

2) From California to Indiana, aerospace to appliance manufacturers, American factories are struggling to procure cold-rolled steel. Manufactures are getting hit by a fresh round of disruption in the U.S. steel industry. Steel is in short supply and prices are surging. Unfilled orders for steel in the last quarter were at the highest level in five years, while inventories were near a 3-1/2-year low. The benchmark price for hot-rolled steel hit $1,176 per ton this month, its highest level in at least 13 years. Domestic steel prices have risen more than 160% since last August, leaving steel consumers in a quandary whether to absorb or pass along the increased cost. U.S. steel prices are 68% higher than the global market price and almost double China’s, even with prices in both China and Europe up over 80% from their pandemic-induced lows. But the price gap is so wide that even with a 25% tariff, it would be cheaper to import than buy from domestic mills. The United States imported 18% of its steel needs last year.

3) The global semiconductor shortage will slash earnings of General Motors and Ford Motor Co. by about one-third this year, as supply constraints hamper production and profits. The chip shortage will materially erode margins and could lower expected earnings before interest and taxes by as much as $2 billion for GM and $2.5 billion for Ford. GM’s EBITA margin could fall to 3.4%, while Ford’s could dip as low as 1.8%. Rising demand for the chips needed to build technologically advanced and connected vehicles has introduced a new set of challenges for the North American auto industry, with shortages triggering production cuts and temporary plant closures. Demand from consumer-electronic companies exacerbated the supply shortages amid the coronavirus pandemic.

4) Stock market closings for – 24 FEB 21:

Dow 31,961.86 up by 424.51
Nasdaq 13,597.97 up by 132.77
S&P 500 3,925.43 up by 44.06

10 Year Yield: up at 1.39%

Oil: up at $63.36

#THECASTPODCAST ep. #18 feat. LiBand: Louisiana Bandman

24 February 2021

1) The employees at Boeing Commercial Airplanes headquarters have been told to clear out their belongings as the coronavirus pandemic has increased the viability of working remotely. The aerospace giant has its Commercial Airplanes headquarters there and has hinted it could sell the facility as a cost cutting measure, although the company hasn’t unveiled its plans publicly. Boeing continually assesses the company’s entire portfolio of real estate property assets and adjusts the company’s footprint as the business environment evolves. Boeing Commercial Airplanes leadership will remain in the Puget Sound region. As Boeing adapt to new market realities and position for the future, they are taking action across the company in five key categories: infrastructure; overhead and organizational structure; portfolio and investment mix; supply chain health; and operational excellence. That involves a look at the costs of maintaining some office space. Boeing can offer more flexibility for their teammates with a combination of virtual and on-site workspace, while also ensuring that leaders and teams are closer to where the work is being done to support customers.

2) In late December, the activist investment firm Engine No. 1 announced that it had the support of the California State Teachers’ Retirement System for the firm’s slate of four candidates for election to the board of directors of Exxon Mobil Corp. Engine No. 1’s stake is less than 0.02%. Like many other oil producers, Exxon cites the role of carbon capture in reducing carbon emissions by the end of the century. Exxon’s stated goal of an 11% to 13% reduction in emissions by 2025 is misleading, according to the firm. That goal does not include what are called Scope 3 emissions, the carbon emitted from burning the oil and gas products a company sells. The investment firm claims that Scope 3 emissions account for about 83% of Exxon’s total emissions.

3) American made solar panels cannot compete with Chinese prices as the demand for green energy increases under the Biden administration. American companies must compete on quality, so must make sure that everything done here is up to a higher standard than anywhere else. Two thirds of all of the world’s solar panels are produced in China, with only a few companies that manufactures panels in the U.S. As it stands now, with America attempts to be self sufficient with energy, we are dependent on to China to supply the bulk of solar panels.

4) Stock market closings for – 23 FEB 21:

Dow 31,537.35 up by 15.66
Nasdaq 13,465.20 down by 67.85
S&P 500 3,881.37 up by 4.87

10 Year Yield: down at 1.36%

Oil: up at $61.32

#EFRPodcast Ep. #38 feat. Professor Helmut Norpoth: Model Gone Wrong!!!!

By: Economic & Finance Report

www.yotube.com/Economic&FinanceReportEFRTV

www.soundcloud.com/Economic-FinanceReport

11 February 2021

1) The Ford Motor Co. has ended its joint venture of electric vehicles with China’s auto maker Zotye, a company with financial troubles so severe that it’s fighting for survival. This does not change Ford’s commitment to producing vehicles for the largest electric vehicle market in the world . . . China. Ford and Zotye had agreed to develop joint ventures but had never actually formed the joint venture ship. Ford plans to move forward with its joint venture with Changan, allowing the Dearborn car maker to produce the already developed Mustang Mach-E in the country quickly and with little additional investment. Ford still has ambitions involving electric vehicles overall and specifically in China. Zotye is in deep financial trouble, requiring state intervention to continue, being on the cusp of collapse.

2) Bond yields are surging, but here’s the bigger threat to stock markets. The stock market rally has hardly been derailed as the yield on the 10-year Treasury reached 1.20% on Monday, which makes for a point advance, with the U.S. stock futures pointing to an upbeat start. Charting the earnings and bond yields show the gap between the two isn’t as narrow as it was at the end of 2018, when stocks lurched lower. The current spread suggests equities could absorb Treasury yields above 1.5%, and assuming earnings continue to move in line with analyst expectations, U.S. and European equities markets could absorb another 135 basis points of tightening by the end of the year. Analysts expect the S&P 500 earnings to grow 24% this year and 16% next year.

3) Oil futures moved up on Tuesday, thereby shedding off earlier weakness, as signs of improving energy demand put global benchmark prices on track to tally an eighth consecutive session gain. That rally has been aided by longer term optimism and expectations of broader market strength, but current prices are likely to generate some anxiety that the rally is near overextended territory. Saudi Arabia’s decision to unilaterally cut output by 1 million barrels a day in February and March, helping to keep supplies in check and prices higher. Crude prices in the $55 to $60 range have historically been sufficient to trigger new production activity in parts of major U.S. shale basins. The prospect of an eventual return of Iranian exports and an unwinding of the record deal between the Organization of the Petroleum Exporting Countries and its allies, together known as OPEC+, offer additional downside price risk.

4) Stock market closings for – 10 FEB 21:

Dow 31,437.80 up by 61.97
Nasdaq 13,972.53 down by 35.16
S&P 500 3,909.88 down by 1.35

10 Year Yield: down at 1.13%

Oil: down at $58.24

8 February 2021

1) Ford Motor Company reports quarterly loss of $2.8 billion dollars, amid increases in investment in electric vehicles. This is a larger than expected quarterly loss, but Ford’s stock traded higher as Wall Street focused on the auto maker’s renewed push toward autonomous and electric vehicles. Their sales fell to $36 billion from $39.7 billion a year ago. Ford increased its commitment to invest in growth, with plans to spend more than $22 billion dollars in electric vehicles and $7 billion in autonomous vehicles. This investment in EVs is nearly double an earlier allocation. In the fourth quarter, Ford began U.S. sales of its all-electric Mustang, the Bronco Sport and 2021 F-150 pickup. These vehicles, alongside the return of the Ford Bronco this summer, are expected to be significant contributors to 2021.

2) Another looming uncertainty for the world automotive industry is the global shortage of automotive microprocessors. Subaru has already suspended operations for two days because of shortages. The company expects to lose 48,000 units of production in this fiscal year to March 31 because of the electronic shortages. The semiconductor shortage is bad! Subaru said that they don’t know how long this impact will last. Also Fiat Chrysler and Jeep are also limiting production because of the chip shortage and weak demand. German car makers (Mercedes-Benz maker Daimler and Volkswagen’s Porsche) are considering building up semiconductor stockpiles, to prevent a repeat of the crippling chip shortages that brought assembly lines to a standstill and stalled the production of hundreds of thousands of vehicles worldwide. A few weeks after a German official sent the Taiwanese government a letter asking for help on the semiconductor issues, Taiwan claims to have not received it.

3) China’s unconventional weapons are reportedly winning the Middle East. China has mastered the art of slowly and meticulously shaping the conditions for its interactions with the United States, gaining an advantage. From a military perspective, the Chinese have diagnosed America’s strategic reliance on conventional overmatch in order to deter major conflict. Instead, they have sought to achieve their objectives through unorthodox approaches that limit the effectiveness of our preferred conventional toolkit.

4) Stock market closings for – 5 FEB 21:

Dow 31,148.24 up by 92.38
Nasdaq 13,856.30 up by 78.55
S&P 500 3,886.83 up by 15.09

10 Year Yield: up at 1.17%

Oil: up at $57.07

4 February 2021

1) Two companies, AmSty and Agilyx, have announced the certified circular recycling pathway for polystyrene for recycling has been cleared. Polystyrene waste is currently being transformed from solid form to its liquid feedstock called recycled styrene monomer (RSM) at their joint venture facility, to produce circular recycled products. These products can now be put back into the marketplace with original quality. This is the major advancement in recycling polystyrene waste in a world being overrun by plastic waste.

2) QuantumScape, the solid-state battery company, debuted its stock which soared up 256% in less than a month, but then plunged 60% from the high. The solid-state battery is lighter, has greater energy density, therefore more range, lower cost and faster recharge times. But solid-state battery packs for cars are far from ready. They do away with the liquid electrolyte that makes conventional lithium-ion batteries heavy, as well as being dangerous at high temperatures. Getting solid-state batteries to the market is difficult and will take some time, so battery packs for cars are far from ready. Two things sent the company stock down. First is a January 4 report saying that QuantumScape’s batteries are small and unproven, smaller than an iWatch battery and never tested outside a lab. A few days later, the law firm Gainey McKenna and Egleston announced a class-action lawsuit against QuantumScape on behalf of investors, noting a 40 percent drop in the stock price after the story ran. QuantumScape has made clear the batteries are still in the development stage, with results from testing small prototypes instead of full power packs. Other companies, such as Toyota, General Motors, Samsung, Ford and Hyundai are working and investing in the new battery technology. The solid-state space energy storage field has been dormant for many years but now it is heating up.

3) It’s reported that China has stolen personal data from 80% of Americans using their Chinese hackers. On the news show 60 Minutes on CBS the former director of the US National Counterintelligence and Security Center disclosed that 80% of American adults have had some amount of their personally identifiable information stolen by the Communist Party of China. Furthermore, there are concerns that the Chinese regime is taking all that information about Americans, such as what we eat, how we live, when we exercise and sleep, and combining it with our DNA data. With information about heredity and environment, suddenly they know more about us than we know about ourselves.

4) Stock market closings for – 3 FEB 21:

Dow 30,723.60 up by 36.12
Nasdaq 13,610.54 down by 2.23
S&P 500 3,830.17 up by 3.86

10 Year Yield: up at 1.13%

Oil: down at $55.95

2 February 2021

1) In October and November Intermodal, shipping carriers rejected U.S. agricultural export containers worth hundreds of millions of dollars. Instead they are sending empty containers back to China to be filled with more profitable Chinese exports. These refusals came during the peak season for agriculture exports. The matter is being investigated to see whether the carriers refusing U.S. export cargo violated the Shipping Act. This act makes it unlawful for carriers to unreasonably refuse to deal with or negotiate, to boycott or take any other concerted action resulting in an unreasonable refusal to deal, or engage in conduct that unreasonably restricts the use of intermodal services. Carriers rejected an estimated 177,938 containers known as TEUs (20-foot equivalent units) in October and November.

2) There are three Pacific military flashpoints that could shape Biden’s entire China strategy these next four years. The suggestion that the departure of President Trump from Washington would ease US-China tensions are being discounted. China has flown more than two dozen combat aircraft near Taiwan and have passed a law which allows China’s coast guard to fire on foreign vessels. Meanwhile, the US Navy has sent an aircraft carrier strike group into the South China Sea. China could use large-scale military exercises near Taiwan or in the South China Sea, or stopping foreign vessels in the name of enforcing Chinese maritime regulations. The flashpoints are: 1) The South China Sea- China has built up tiny reefs and sandbars into man-made artificial islands, fortified with missiles, runways and weapons systems. 2) Taiwan and the Taiwan Strait- Despite 75 years as an independent nation, China claims Taiwan as belonging to China, and has repeatedly stated its intention to bring Taiwan under its control, with force if necessary. 3) Japan- Strongly aligned with the U.S. There is contention between Japan and China over Senkakus, an uninhabited rocky island chain, 1,200 miles southwest of Tokyo.

3) Experts predict that Phoenix Arizona may become uninhabitable by the end of this century. The Southwest is facing a reckoning from decades of human development, coupled with rising global temperatures from carbon emissions, which means that many major cities in the Southwest may become uninhabitable for humans this century. They are concerned that cities like Phoenix may have temperatures above 100 degrees for a third of the year, including well after dark.

4) Stock market closings for – 1 FEB 21:

Dow 30,211.91 up by 229.29
Nasdaq 13,403.39 up by 332.70
S&P 500 3,773.86 up by 59.62

10 Year Yield: down at 1.08%

Oil: up at $53.61

28 January 2021

1) There are reports that Biden’s $1.9 trillion dollar coronavirus relief bill is in trouble, and the Democrats might not be able to pass the next round of stimulus until March. This new round of coronavirus relief is already facing political and logistical hurdles in Congress. Beyond Republican opposition, key senate democrats also need to be convinced of Biden’s relief bill. With tight margins between the two parties in Congress, straight party line votes are in doubt to pass legislation, and also the relief bill may not get a vote until mid-March, when the $300 weekly unemployment assistance program expires.

2) After spending almost two decades underground, trillions of Brood 10 cicadas are due to appear in states between Georgia and New York this spring, after their 17 year long stint of underground activity, which started in 2004. The insects have been living beneath the soil, where they tunnel and live off tree root sap. From around mid-May to late June, the insects will emerge in Georgia, Kentucky, North Carolina, Virginia, and Tennessee in the south east and south, and Illinois, Indiana, Michigan and Ohio in the Midwest. The northeastern and eastern states of New Jersey, New York, Pennsylvania, and West Virginia will also see the insects, as well as Delaware and Washington, D.C., in the mid-Atlantic region. Trillions of the insects are expected to appear in the U.S. this year, with densities of 1.5 million ‘bugs’ per acre in some cases.

3) Having declared her intentions to dominate artificial intelligence by 2030, some experts consider China is winning the artificial intelligence race. China is poised to take the lead in artificial intelligence applications applying to manufacturing, health care and transportation, thereby leapfrogging the West in key new technologies. In particular, China’s artificial intelligence security cameras using facial recognition technology are considered far above anything other western countries are producing. Furthermore, China is well on its way to building a 10 million 5G mobile base stations by 2024, which will wire virtually the whole country for game-changing technologies. Three dimensional facial imaging allows these systems to monitor the mobility of people and contact with others. This makes for a powerful tool allowing the government to control their people.

4) Stock market closings for – 27 JAN 21:

Dow 30,303.17 down by 633.87
Nasdaq 13,270.60 down by 355.47
S&P 500 3,750.77 down by 98.85

10 Year Yield: down at 1.01%

Oil: down at $52.63

27 January 2021

1) There are growing fears that the long running bull market is about to crumble and collapse. The biggest sign is there are fewer stocks helping to drag benchmarks toward fresh records. When the underlying momentum wanes then we see weaknesses developing under the surface, which is what’s happening now. Fewer stocks are managing to end above their short-term moving averages even as indexes show record closing highs and yet fewer than 45% of their stocks managed to close above their 10-day moving averages.

2) China is working to overtake America by leading the global recovery from the pandemic thereby becoming more influential on the world stage than ever before. And China just might have the momentum and confidence to pull it off. As the world’s second largest economy shrugs off much of the Covid-19 pandemic this last year, China’s economy continues growing while the world crashes into recession. This could mean China’s GDP will exceed the United States later this decade, which will be years earlier than expected. China has outpaced the United States in attracting foreign direct investment for the first time, signing a trade agreement with the European Union giving European companies greater access to China’s1.4 billion consumers. Furthermore, China’s starts the new year without one of its most aggressive political adversaries, the former President Trump. China has sent help to other countries and in the process left many third world countries deeply in debt to China, claiming they are injecting more momentum into growth. But a host of geopolitical challenges, including the clashes over Hong Kong and alleged human rights abuses in China’s Xinjiang region, taking control of islands in the South China Sea and threats to Taiwan have all exacerbated tensions with the West and may stymie efforts to foster multilateral cooperation. These actions are unacceptable to the democratic nations, who are pulling away from China despite its attractiveness as a market.

3) There are fears that Biden’s executive order will aggravate America’s food crisis, by signing an executive order that addresses America’s most pressing economic needs. This order includes measures to blunt the meteoric rise in food insecurity during the pandemic. The order calls on the U.S. Department of Agriculture (USDA) to expand three key food assistance programs, which are the Pandemic Electronic Benefits Transfer (P-EBT), SNAP, and the Thrifty Food Plan.

4) Stock market closings for – 26 JAN 21:
Dow 30,937.04 down by 22.96
Nasdaq 13,626.06 down by 9.93
S&P 500 3,849.62 down by 5.74
10 Year Yield: unchanged at 1.04%
Oil: down at $52.75