25 March 2021

1) There is a large backup of freighters parked in the San Francisco Bay and in Long Beach, which are awaiting an opening at the Port of Oakland. This is because of a trade bottleneck, a result of the COVID-19 outbreak, thereby leaving U.S. businesses anxiously awaiting goods from Asia. The pandemic has wreaked havoc with the supply chain since early 2020, because it forced the closure of factories throughout China. The problem arose last March, when Americans stayed home, thus dramatically changing their buying habits. Instead of clothes, they bought electronics, fitness equipment and home improvement products. In turn U.S. companies responded by flooding the reopened Asian factories with orders, which then lead to a chain reaction of congestion at ports and freight hubs as the goods began arriving. Ships with as many as 14,000 containers have sat offshore, some of them for over a week, with as many as 40 ships waiting.

2) The manufacturing crisis with automakers continues to grow, with the auto industry bracing for more chip shortages after a fire at a plant owned by Japanese chipmaker Renesas. The company makes chips for Toyota, Nissan and Honda, and expects production at one of the buildings at its Naka Factory in Hitachinaka to be halted for a month. Renesas said the fire started when some equipment overheated and ignited, though it isn’t known what caused it to overheat. Renesas said two-thirds of the products made in the building could be produced elsewhere, although due to the recent increase in demand for semiconductors, the situation does not allow for all products to be immediately produced alternatively. This further reduction in semiconductor production will further reduce production of automobiles worldwide.

3) North Korea tells China they should team up as ‘Hostile Forces’. North Korea’s Supreme Leader Kim Jong Un reportedly praised his country’s close ties with neighboring China, looking to boost their ties to counter the hostile policies of the United States. China and North Korea’s close ties date back to the founding of the People’s Republic in 1949, then the outbreak of the Korean War a year later. In the war, Chinese troops supported North Korean forces with the backing of the Soviet Union, against South Korea and a U.S. led United Nations coalition. However, the fighting ended in a stalemate with an armistice but no official peace, which continues to this day. The North Korea considers that the world is now undergoing transformations rarely seen in a century, which is also overlapped by the ‘once in a century’ pandemic. What this portents for China and North Korea’s future actions . . . only time will tell.

4) Stock market closings for – 24 MAR 21:

Dow Jones 32,420 down by 3.09
NASDAQ 12,962 down by 265.81
S&P 500 3,889 down by 21.38

10 Year Yields: 1.6280

Oil: up at 64.41

3 December 2019

1) President Trump has imposed tariffs on metal from Brazil and Argentina in response to currency manipulation which hurt American farmers. The tariffs is on steel and aluminum imports. Additionally, Trump has called on America’s central bank to take action to prevent other countries from devaluing their currencies. Brazil and Argentina had been exempt from tariffs imposed in March 2018.

2) The factory sector in the U.S. shrank again in November, the fourth straight month as new order volumes slid back to around their lowest level since 2012. The index of national factory activity fell to 48.1, a reading below the expectations of 49.2, a reading above 50 indicates expansion while below indicates contraction.

3) The auto makers Nissan Motor Co., Renault SA and Mitsubishi Motors Corp. have formed an alliance in the form of a new company to do research and development of advance automotive technologies. The new venture also aims to strengthen the alliance which has been worn thin since the arrest and ouster of former supremo Carlos Ghosn. The formal plans will be announced in January.

4) Stock market closings for – 2 DEC 19:

Dow           27,783.04    down    268.37
Nasdaq        8,567.99    down      97.48
S&P 500       3,113.87    down      27.11

10 Year Yield:    up   at    1.84%

Oil:    unchanged   at     $55.42