22 January 2021

1) President Biden is asking Congress for $1,400 stimulus checks, but economists advise caution before spending, because economists who have looked at what happens when people have time to mull over a financial windfall, found that they spend less of the money, rather they save more of it. With less spending, there is less stimulus to the economy, therefor the stimulus fails to do the intended purpose. For the first stimulus checks in April people generally spent between one-quarter and one-third of the check in the first 10 days. Bottom line, the longer payment delays make it more likely that households will save their stimulus checks, which undermines the goal of stimulating the economy by boosting consumption.

2) The Treasury Secretary nominee Janet Yellen will be part of the Senate Finance Committee process of vetting President Joe Biden’s $1.9 trillion dollar Covid-19 relief plan. She will say that low borrowing costs means it’s time to act big. The new package includes a minimum-wage hike and substantial expansion in family and medical leave, social safety-network of programs that have already triggered Republican opposition. There are still almost 11 million unemployed Americans in an economy still being battered by the pandemic. Declines in both payrolls and retail sales in December left the nation’s economy limping into the new year. Additionally, more than 17 million people say they have little to no confidence in their ability to pay their rent next month. However, Yellen will also be asked what the safe debt limit is, since it is already on the verge of surpassing 100% of the GDP. There is also the question of the pros and cons of strengthening the dollar among fears that a stronger dollar will weaken the U.S. economy.

3) The U.S. government has approved routes for a system of pipelines that will move carbon dioxide across Wyoming for disposal. The greenhouse gas is captured from coal-fired power plants, to keep it out of the atmosphere where it causes global warming. The captured CO2 is then pumped underground to add pressure to and boost production of oil fields. The pipeline is about 1,100 miles of federal land through the Wyoming Pipeline Corridor Initiative. This project is a way to boost the state’s struggling coal mining industry.

4) Stock market closings for – 21 JAN 21:

Dow 31,176.01 down by 12.37
Nasdaq 13,530.92 up by 73.67
S&P 500 3,853.07 up by 1.22

10 Year Yield: up at 1.11%

Oil: up at $53.03

20 January 2021

1) There are growing fears of another stimulus package as the national debt grows. One measure of unemployment suggests Biden’s $1.9 trillion dollar stimulus plan may do more harm than good. The U-6 unemployment rate, a less popular reading than the commonly cited U-3, suggests additional fiscal support could be unnecessary. The gauge (which includes those only partially participating in the labor force) currently is at 11.7%. Five of the past six recessions saw higher readings. The coronavirus pandemic initially pushed the U-6 rate to a record-high of 22.9% in April, but easy monetary conditions and the $2.2 trillion dollar stimulus package brought the rate down in a matter of months. Still, there are serious questions about the long term stability of the world economics as nations struggle to pay off these huge national debts.

2) A new Covid-19 variant has been discovered in Brazil adding to the two newly emerged variants from the United Kingdom and South Africa. Brazil is one of the worst affected countries by the virus, where more people have died of the virus than anywhere else outside the United States. An urgent COVID warning says the worst months are still ahead, and is expected to get more people sicker faster. Infections and deaths are expected to continue increasing.

3) President-elect Joe Biden has an ambitious environmental agenda, with a principle goal of transitioning away from using fossil fuels. There are many questions just how this climate plan could affect the oil and gas industry in America. The new requirements include disclosure of climate risks from public companies, a commitment to end new drilling permits for federal lands, and to eliminate tax subsidies for the oil and gas industry. Tougher methane regulations to give incentives for Americans to buy cars that do not run on gasoline. It’s not just the big oil companies which can be hurt, for there are thousands and thousands of small companies making up the supply chain businesses, as well as the small independent wildcatters who are producing oil. But while oil is slowly recovering with prices above $50 a barrel, it is all in jeopardy if these proposals go into effect. Biden’s proposals could face stiff challenges from Texas officials and the oil and gas industry itself.

4) Stock market closings for – 19 JAN 21:

Dow 30,930.52 up by 116.26
Nasdaq 13,197.18 up by 198.68
S&P 500 3,798.91 up by 30.66

10 Year Yield: down at 1.09%

Oil: up at $53.17

19 January 2021

1) President Trump and several of his key aids are preparing to move en masse to Florida this Wednesday just prior to the swearing in of Joe Biden as President. Trump plans to make his resident at his Mar-a-Lago estate. Staff members moving with the President are said to be White House press secretary Kayleigh McEnany and White House legislative aide Cassidy Hutchinson. Other aides who may work for Trump include Nick Luna, the director of Oval Office Operations and Molly Michael, a deputy assistant to Trump. Additionally, Luna’s wife, Cassidy Luna, a deputy assistant to the president, may work for the President’s son in law, Mr. Kushner.

2) There are fears that more than 90,000 Americans could die of Covid-19 in the next three weeks, with more than 38,000 Americans having died in the first two weeks of the new year from the pandemic. Presently, more than 130,000 people are hospitalized with the virus, with hospitals across the nation at or near the maximum capacity of their intensive care abilities. The US has added more than three million new infections since the start of the month. Mass vaccination centers are being opened. More than 30.6 million vaccine doses have been distributed, but only 11.1 million Americans have received their first dose, leading to out of date vaccine having to be thrown away. There are plans to press the large pharmacies chains into service to also give vaccinations.

3) Major labor unions are urging Speaker Nancy Pelosi and incoming Senate Majority Leader Charles Schumer to provide $1 trillion dollars in emergency funding for states, cities, towns and schools. All of these entities have heavy union representation whose members stand to benefit from the increased monies. It is unclear how spending of this money is suppose to stimulate the economy.

4) Stock market closings for – 18 JAN 21:

Dow 30,814.26 down by 177.26
Nasdaq 12,998.50 down by 114.14
S&P 500 3,768.25 down by 27.29

10 Year Yield: down at 1.10%

Oil: up at $52.19

18 January 2021

1) One Chinese province, Heilongjiang, with more than 37 million, has declared an emergency state to snuff out a handful of Covid-19 cases, as China moves decisively to contain infections. China had largely brought the coronavirus under control since its emergence in Wuhan late in 2019, however in recent weeks China has seen smatterings of cases, prompting localize lock downs, immediate travel restrictions and widespread testing of tens of millions of people. China is trying to squash the virus ahead of next month’s Lunar New Year festival, when hundreds of millions of people are due to travel across the country. Those highly anticipated annual journeys are often the only time for many migrant workers to see their families.

2) Biden has promised to extend the pause on student loan payments during his first day in office. Here are other steps the new administration could take for student debt relief. Forgiving $10,000 in student loan debt for each person, but it’s unclear of the time frame to do so. Also, it is unclear on whether Biden can use executive powers to cancel student debt or if only the Congress can do it. On day one Biden will direct the Department of Education to extend the student loan forbearance program, the first promise the president-elect has made in combating the $1.6 trillion student debt crisis. Senator Elizabeth Warren of Massachusetts is pushing for $50,000 to be forgiven.

3) Scientist warns that civilization is on the precipice of a ‘ghastly future’ that humanity has gravely underestimated the effects of biodiversity decline, climate change, and pollution. A review of over 150 studies finds the central problems we face are economic and political systems centered around unsustainable human consumption and population growth at the expense of all else. Biodiversity loss started some 11,000 years with the start of agriculture, which has vastly accelerated in recent centuries due to ever-worsening pressures placed on natural ecosystems. With a world population of 7.5 billion, which is expected to peak at 10 billion, that is worsening existing food insecurity, soil degradation, biodiversity decline, pollution, social inequality, and regional conflicts. Food production is sustained with the increasing use of fossil fuels and petrochemicals. Humanity is running an ecological Ponzi scheme in which society robs nature and future generations to pay for boosting incomes in the short term, all supported with petrochemicals. Half the large mammals in the world are humans, the other half are the domestic animals providing humanity with subsistence. All the other large mammals fit into just a 5% sliver.

4) Stock market closings for – 15 JAN 21:

Dow 30,814.26 down by 177.26
Nasdaq 12,998.50 down by 114.14
S&P 500 3,768.25 down by 27.29

10 Year Yield: down at 1.10%

Oil: down at $52.04

13 January 2021

1) Reports are that Biden will unveil plans to spend trillions of dollars in pandemic and economic relief money this next week. Biden is introducing several members of his economic team, after data shows the U.S. economy has lost jobs for the first time in eight months as a resurgent COVID-19 pandemic has again shuttered restaurants and other businesses. Biden is calling for raising the minimum wage to $15, and for sending out $2,000 in direct cash payments. Biden claims that economic research confirms that with today’s crisis, especially with such low interest rates, taking immediate action, even with deficit financing , is going to help the economy. Biden also say they are looking into other economic relief actions that can be taken unilaterally, including extending a pause on repayments of federal student loans.

2) US naval aircraft carrier groups still rule the seas, but both Russia and China have plans to change that as they strive to expand their blue water navies, by developing new weapons that could threaten America’s dominance. For instance, it is reported that China launched two ballistic missiles that hit a moving target ship in the South China Sea thousands of miles from their launch sites. The Russian navy conducted its third test launch of it’s hypersonic anti-ship cruise missile that was launched from a frigate. The missile reached a speed of Mach 8 before hitting a target more than 200 miles away. These tests are the latest indication that American aircraft carriers, long viewed as kings of the seas, may soon face a real threat to their existence.

3) Iran has told South Korea not to politicize the seizure of their vessel, while demanding the release of $7 billion dollars in funds frozen amid U.S. sanctions. Additionally, Iran has denied all allegations that the seizing of South Korea’s tanker and its 20-member crew amounted to hostage taking, claiming instead it was Seoul who was holding Iran’s funds hostage. The vessel was seized based on an Iranian court order for ‘environmental pollution’, however, the ship’s Busan-based operator, said there was nothing to indicate that before the seizure of the vessel that Iranian authorities were probing possible violations of environmental rules.

4) Stock market closings for – 12 JAN 21:

Dow 31,068.69 up by 60.00
Nasdaq 13,072.43 up by 36.00
S&P 500 3,801.19 up by 1.58

10 Year Yield: up at 1.14%

Oil: up at $53.38

8 Janury 2021

1) The price of oil advanced as shrinking U.S. crude inventories added to expectations of a tighter global supply outlook after Saudi Arabia surprised the markets by pledging to reduce production for the next two months. Gasoline demand is falling to its lowest level since late May, spelling trouble for refining margins as a tighter global crude balance and straggling demand crimp profits for processing a barrel of oil. Saudi Arabia has decided to reduce crude output in February and March as part of an OPEC+ supply agreement. With the outlook for crude oil supply suddenly looking tighter, the oil options markets have grown less bearish.

2) A top scientist explains why a more infectious coronavirus variant is a bigger problem than a deadlier strain, with the deadly coronavirus having now mutated. One variant, called B.1.1.7, is more infectious, and has forced the UK into national lock down, with the variant having also been discovered in several US states, as well as other countries around the world. However, the new variant does not appear to be more deadly, so existing vaccines should also work against it. A really severe disease that one person gets won’t necessarily have as much impact as a lesser disease which a huge number of people get. While not any more deadly the new mutant B.1.1.7 is much more infectious, and is to blame for the surging numbers of people infected, filling up UK hospitals that forced the national lock down. It is estimated to have a 71% higher growth rate than other variants.

3) North Korea’s supreme ruler Kim Jong Un has announced a military expansion, but it is unclear if Pyongyang plans to ramp up its nuclear program too. This could put pressure on the incoming Joe Biden administration just when it is most vulnerable. North Korea plans to boost its military capacities in defiance of international sanctions, as well as a new five-year economic plan, admitting the previous program has failed. It’s unclear just what the military expansion will involve.

4) Stock market closings for – 7 JAN 21:

Dow 31,041.13 up by 211.73
Nasdaq 13,067.48 up by 326.69
S&P 500 3,803.79 up by 55.65

10 Year Yield: up at 1.07%

Oil: up at $50.91

Oil: up at $50.48

7 January 2021

1) Chinese stocks listed in the U.S., including China Telecom Corp. and Pinduoduo Inc., fell on the prospect of further American sanctions. This decline was led by a group of Chinese telecommunications stocks after the New York Stock Exchange said it will delist three companies to comply with a U.S. executive order. While the companies are mostly traded in Asia, their stocks are also traded domestically. But an order from President Trump barred American investments in China-based firms that are affiliated with the military. However, there is now talk of the order being modified or even rescinded.

2) Reportedly, Chinese cities are going dark as the country faces shortages of coal, which is a major Australian export, as authorities limit power usage, citing the shortage of coal. Analysts said prices of the commodity in the country have shot up due to the reported crunch with some tying the shortages and blackouts to the unofficial ban on Australian coal. In turn, prices of the commodity have shot up due to the reported crunch. The reports also follow rising trade tensions between Beijing and Canberra, leading some analysts to tie the coal shortages and blackouts to the unofficial ban on Australian coal. Relations between the two nations have soured since last year because Australia supported an international inquiry into China’s handling of the coronavirus pandemic. Coal is just one in a growing list of Australian goods that China is targeting. China is the world’s largest coal consumer and its greatest source of coal imports was Australia.

3) Shale oil needs more than $50 a barrel to be profitable, something that is now a possibility because of Saudi Arabia’s pledge for a big supply cut in their oil production. But Joe Biden wants to ban new fracking in New Mexico, an area that has emerged as the ‘go-to’ spot for drillers desperate to squeeze as much crude from the ground without bleeding cash. The price was above $50 before the pandemic sent oil markets crashing, forcing over 40 explorers into bankrupt. It will take at least three months for shale producers to ramp up production, because that would involve decisions on new drilling and getting well-completion crews together, which puts their operations well into the new Biden administration.

4) Stock market closings for – 6 JAN 21:
Dow 30,829.40 up by 437.80
Nasdaq 12,740.79 down by 78.17
S&P 500 3,748.14 up by 21.28
10 Year Yield: up at 1.04%
Oil: up at $50.48

6 January 2021

1) With the ravages of the new coronavirus, Los Angeles County has been so overwhelmed it is running out of oxygen. Arizona now has the nation’s highest rate of coronavirus hospitalizations. In the Atlanta area, nearly every major hospital is almost full, prompting state officials to reopen a field hospital for the third time. This last week, new deaths and cases have increased by more than 20 percent, for a total of more than 355,000 fatalities and 21 million infections. But the toll on hospitals is more critical. Southern California is running low on ICU beds, ventilators and morgue space. But the greatest shortage is oxygen. The sheer number of patients has placed such a strain on oxygen systems that some hospitals are struggling to provide adequate air pressure and flow into patients’ lungs. But expanding the oxygen supply doesn’t solve the problems, because of the volume being pumped, some of the pipes start to freeze up. Also you start running out of oxygen tanks that patients need to be discharged and sent home. As cases increase ICU beds get full, ER gets backed up, ambulances have nowhere to take patients. There’s severe, chronic staffing shortages, while elective surgeries get canceled so the ability to care simply degrades.

2) It is being reported that President Trump privately admits his defeat, but he wants to continue brawling for attention, so Trump has kept up a flurry of activities to pressure other Republicans to aid his effort to block Biden’s presidency. But one factor political pundits are overlooking is the state of the economy that Biden will inherit. Many are expecting the economy to make a strong quick recovery, but with the whole western economies going into massive deep debt, the likelihood of sever economic problems, that are worst than the 2008 downturn, looms large. The chances of Bidens new administration turning things around for America are very, very slim. And when there are economic problems, the President gets blamed even if it’s not his fault, so the new President will soon be in trouble with the people turning against him. Whether by design or accident, the charges of election fraud will most likely become an ‘albatross’ tied around Biden’s neck. For while the people now want to ignored the questions of voter fraud and corruption, as public opinion diminishes, that ‘albatross’ will hang heavy pulling his presidency down.

3) Communist China continues its backslide into a repressive totalitarian regime with the arrest of dozens of Hong Kong democracy activists and opposition politicians for violating the city’s controversial national security law, in what appears to be the largest roundup yet under the China imposed legislation. The Chinese justify the law which bands subversion, terrorism, secession and collusion with foreign forces, but the law has mainly been used against non-violent political opponents and dissidents.

4) Stock market closings for – 5 JAN 21

Dow 30,391.60 up by 167.71
Nasdaq 12,818.96 up by 120.51
S&P 500 3,726.86 up by 26.21

10 Year Yield: up at 0.96%

Oil: up at $49.81

28 December 2020

1) Rich Americans are rushing to make large transactions before the end of the month and year, intending to get ahead of expected raising of taxes or closing of loopholes. The year-end frenzy come as a surprise to many advisers, because Republicans did better than many expected in congressional races. This suggests Biden may have a difficult time fulfilling campaign promises to raise trillions of dollars in new revenue from the wealthy. The new Biden administration could close the many loopholes that make the U.S. estate and gift tax easy to avoid.

2) The bill for the pandemic relief is 5,600 pages long containing more than one million words, which makes it slightly longer than “A Dance to the Music of Time”, Anthony Powell’s classic 12-volume work, which is considered the longest novel in the English language, taking more than 100 hours to read aloud. But while the bill doesn’t provide the relief of the first one, it will create two new Smithsonian museums and a Theodore Roosevelt Presidential Library in North Dakota. There is legislation for copyright holders to pursue increasingly frivolous claims against YouTube users. Economic sanctions and other penalties to any Chinese national who attempts to interfere in the process by which the 15th Dalai Lama is chosen. It will ban a now-defunct activist group from receiving federal funding. In short, much of the bill provides no help for Americans struggling to survive this economic calamity. Therefore, the stimulus bill is the worst of both worlds of Democrats and Republicans.

3) Communist China is adding to its military aggressiveness by developing amphibious assault ships to enhance its blue water navy and dominate the seas. The 40,000-ton assault warship is the key to Beijing’s ambition of dominating the Taiwan Strait and South China Sea, where frequent encounters with the United States Navy have occurred this year. A total of eight Type 075 amphibious assault ships have been ordered by the PLA, with the third one currently under construction and expected to be delivered in early 2021. The landing helicopter dock carries 30 attack helicopters and 900 troops. The assault ships gives China the ability to conduct vertical deployment in military operations on islands and reefs, the Chinese Communist citing self-governing Taiwan and the South China Sea as examples.

4) Stock market closings for – 24 DEC 20:

Dow 30,199.87 up by 70.04
Nasdaq 12,804.73 up by 33.62
S&P 500 3,703.06 up by 13.05

10 Year Yield: down at 0.93%

Oil: up at $48.23

18 November 2020

1) Crude oil prices and energy stocks aren’t the only things that have fallen during this oil downturn, land prices with potential oil shale have also plummeted. The average price of U.S. oil shale acreage has fallen by more than 70 percent in two years, falling from $17,000 per acre in 2018 to $5,000 per acre in 2020. The value of oil and gas assets has plunged because of the coronavirus pandemic sending crude oil demand down globally, consequently most energy companies are slashing their costs instead of purchasing new land for oil and gas drilling. Oil and gas companies are forced to sell assets to make up money lost on deals.

2) On January the first of next year, President Trump’s pause on student loan payments for 33 million Americans is set to expire, just three weeks before President-elect Joe Biden is slated to take over. The Education Department is warning borrowers this week that their monthly payments will resume. For the incoming president, the economic and administrative mess could take months to untangle, consuming the early days of his Education Department. The student loan system was not designed to start and stop at any time for 30 million borrowers. This became apparent in March when loan payments were suspending and problems for borrowers quickly arose. This is just one facet of the economic problems facing the new president in just a few months, that not only must be addressed, but addressed correcting if problems are not to get worst.

3) The United States has surpassed 11 million coronavirus cases , that’s 1 million new infections in just one week, or 2 million since the beginning of the month. Consequently, hospitals are reaching a breaking point trying to treat nearly 70,000 Covid-19 patients. Medical workers are tired . . . mentally, physically and emotionally exhausted. The stress is being felt around the nation, with the virus spreading like wildfire and the medical system having no backup. If you act early, you can save lives, but if you don’t, you’ll be swamped by a tsunami of this virus. But a Covid-19 vaccine may be in the making with Moderna announcing it has developed a vaccine that’s nearly 95% effective, capable of preventing severe illness, and it could start giving vaccinations to high-risk patients and health care workers as soon as December. A week before, drugmaker, Pfizer announced that its human trials suggest its coronavirus vaccine is more than 90% effective.

4) Stock market closings for – 17 NOV 20:

Dow 29,783.35 down 167.09
Nasdaq 11,899.34 down 24.79
S&P 500 3,609.53 down 17.38

10 Year Yield: down at 0.87%

Oil: down at $41.40