Here's our summary of key economic events overnight that affect New Zealand with news the international economy is basically healthy again as we move into the long holiday break.
First today, the new US President has announced his big infrastructure plan, a US$2.25 tln proposal and funded in part by raising the corporate tax rate and 'closing loopholes'. Believe it or not, Wall Street likes the plan and rose sharply today, even if they don't want the taxes aimed at them. It is a plan that may face trenchant Republican opposition, but given the Biden success in pushing through the first stimulus plan, this one may also have a reasonable chance of success.
Elsewhere in the US, fast rising mortgage interest rates have capped the growth in mortgage applications. Those rising rates may have also taken the steam out of their residential real estate market with pending home sales down -10.6% in February in a nationwide trend. In fact, they now have a year-on-year decline as well, snapping a long string of housing market volume gains.
On Saturday (NZT) we will get the March non-farm payrolls report for the US, and another strong gain is expected of +647,000 after a strong February. Today expectations for the ADP Employment Report were high as well (+550,000) but the actual result was slightly lower at +517,000. There were gains across the board, but especially in their services sector, and especially in hospitality as they reopen.
Also very positive is the Chicago PMI which came in at its highest in nearly three years. Among the main five indicators, Production saw the largest gain, while Order Backlogs saw the biggest drop. Prices paid at the factory gate escalated for the seventh month in a row.
In China, they reported a small but welcome improvement in their factory PMIs. A much bigger improvement was reported in their service sector PMIs. This is positive data, but compared to the rebound in the US, it is relatively tame.
And China said it had an investment outflow in 2020, allowing funds to flow out of the country in part to ease the pressure on the yuan. The amounts involved are not huge however, about NZ$110 bln over the whole annual period.
South Korea reported February factory production data overnight and there were strong month-on-month gains (+4.9%) and a small +1.0% year-on-year rise.
Japan also reported February factory production data and that wasn't positive, with declines month-on-month (-2.1%) and year-on-year (-2.6%). The best they can say is that these declines are less than previously.
In Australia, there are suggestions that the Bank of Queensland might be contemplating a purchase of Westpac NZ.
Wall Street is higher today with the S&P500 is now up +0.8% in early afternoon trade. Overnight, European markets closed about -0.3% lower, although London was down -0.9%. Yesterday, Tokyo also closed with a -0.9% drop. Hong Kong was down -0.7%. Shanghai closed with a -0.4% loss. The ASX200 ended its session -0.8% higher and making back the Tuesday loss, while the NZX50 Capital Index ended with a +0.9% gain on top of the good prior day gain.
The latest global compilation of COVID-19 data is here. The global tally is still rising, now 128,451,000 have been infected at some point, up +588,000 in one day. Global deaths reported now exceed 2,807,000 and +11,000 in one day. Vaccinations in the world are also rising fast, now up to 552 mln and in the US almost 45% of their population (146.3 mln) have now had this protection (+4.1 mln in one day) as they achieve a very fast rollout. The number of active cases there fell to 6,954,000 (-13,000 in one day), so no overall sign yet of an unwelcome spike in infections.
The UST 10yr yield is up +1 bp at 1.73%. The US 2-10 rate curve has flattened slightly to 156 bps. Their 1-5 curve is unchanged at +85 bps, while their 3m-10 year curve is also unchanged at +171 bps. The Australian Govt 10 year yield is up +3 bps at 1.81%. The China Govt 10 year yield is unchanged at 3.22%. And the New Zealand Govt 10 year yield is up +5 bps at 1.82%.
The price of gold starts today having recovered yesterday's sharp fall, up +US$29 at US$1714/oz. For the month, the gold price is virtually unchanged.
Oil prices have stabilised and are now at just over US$60.50/bbl in the US, while the international price is now just over US$64/bbl.
The Kiwi dollar opens today marginally firmer at just on 70 USc. Against the Australian dollar we are unchanged at 91.9 AUc. Against the euro we are also virtually unchanged at 59.6 euro cents. That means our TWI-5 opens today fractionally higher at 72.7. And that means our currency devalued by -1.8% over the month of March.
The bitcoin price will start today at US$58,916 and up a mere +0.4% from this time yesterday. But it rose a massive +26% over the whole March month. Volatility in the past 24 hours has been moderate at +/- 2.5%. The bitcoin rate is charted in the exchange rate set below.
The easiest place to stay up with event risk today is by following our Economic Calendar here ».
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48 Comments
So something I have picked up in a world of derelict media relates to the trial for the murder of George Floyd.
The Hennepin County medical examiner Dr Michael Baden "determined" that the cause of death was homicide. Dr Michael Baden has assumed the power of the court by making that statement. That this has gone unchalleged makes this a dangerous world. Reminds me of how the FBI did that with their application for a warrant to invade Kim Dot Com's home by stating he was part of a criminal conspiracy. Maybe it is an American thing.
Video not really conclusive though is it because we don't know what happened before hand that lead to him being restrained on the ground. The guys wasn't just chosen at random and thrown to the ground. Ultimately the cops over there would get sick of dealing with people like this every day. There are so many guns and drugs over there the city streets would be a nightmare to patrol so you shoot first and ask questions later. Sorry but I don't have a whole lot of sympathy. Over 300 people are shot in the US every day.
And with an underlying heart condition there is not sufficient evidence to tie kneeling on his neck(which on the face of it looks bad) to death by cardio pulmonary failure. No Actus Reus. Mens Rea also problematic for a cop doing his job. It's called reasonable doubt. This would not have made it past the depositions hearing in NZ.
Yet the world went mad based on a flawed narrative. What is the cost of this?
I was on the beat for seven years. But I recognised some time ago with this issue that you can't control your emotions or common sense, which is exactly the sort of person Police have to deal with day to day. The cops were wearing cameras also, an that footage is available online. What happened there happens every day right across the USA, non-compliant and difficult people getting arrested. It is what Police do, I suggest you try and go out with them one day to see the sort of dickheads you have to deal with. Police had no way of knowing of his underlying medical conditions, but it probably was clear he was on drugs.
What is clear is that you know nothing about such matters and really discredit yourself with expressing uninformed opinion. Trial by media alright and you are right in the thick of it.
One of the guys I joined with (on another section but went to AK) was three months into the job when a scuffle broke out when trying to arrest a domestic violence offender. His arm around the offender went through a mirror, the shards of glass cut right through to the bone, including the tendon. He was off work for six months, and light duties for the first six when he did come back.
Things can get out of control very quickly, you have to control the offender and, control the scene. No different in a road crash, you have to control the scene or it gets worse.
Armchair experts are the worst. They are the ones truly responsilbe for the riots, the violence and destruction, around the BLM movement. They are the ones that sucked it up on the media and become inflamed.
And I'm not even completely pro police, I'm neutral, my article last year makes that clear. There were some arsehole cops around me, but 95% are just trying to do a good job. They get burnt out because they care and can't make the difference they thought they could. I'm the thinking around this and putting into the context of society at large, including the ecomomic cost.
Back in 2014 PM Key and President Xi sealed the deal to allow Kuang Chi Science , a listed Hong Kong company ,and the then named Pengxin International, the owner of of some recently acquired farmland to use New Zealand airspace and Pengxins land to fly some balloons and ribbons into near space, an issue that Dr Anne Brady has also written about.
One of KuangChi's many stated ambitions at the time was to utilize the party balloons to provide internet coverage for the Congo.
I note just prior to Xmas that the United States Federal Register placed Kuangchi on the entities list , stating
"The ERC determined to add the entities AGCU Scientech; China National Scientific Instruments and Materials (CNSIM); DJI; and Kuang-Chi Group for activities contrary to U.S. foreign policy interests. Specifically, these four entities have enabled wide-scale human rights abuses within China through abusive genetic collection and Start Printed Page 83417analysis or high-technology surveillance, and/or facilitated the export of items by China that aid repressive regimes around the world, contrary to U.S. foreign policy interests."
https://www.federalregister.gov/documents/2020/12/22/2020-28031/additio…
https://www.nzherald.co.nz/nz/space-launch-from-dairy-farm-after-john-k…
NZ Govt won’t stand (or sign)
https://www.state.gov/joint-statement-on-the-who-convened-covid-19-orig…
Predicted this a month ago - they're off and racing
https://opoly.co.nz/ (derivation of monopoly)
Group Shareholdings in a company structure creates a cashed up outfit to invest in property without borrowing
Also very positive is the Chicago PMI which came in at its highest in nearly three years.
Like many other markets, eurodollar futures indicate that things are picking up from last year’s lows (like Treasuries, August 4); this is reflationary. But like Inflation Hysteria #1, here in Inflation Hysteria #2 many are basing their hysteria upon this (and other) market changing direction rather than appreciating the rest of the curve’s more indicative dimensions.
In other words, despite almost eight months of these reflationary tendencies, hearing about “money printing” and fiscal excesses the entire time, when we compare (apples to apples, normalizing curves by time dimensions rather than calendar months) reflationary curves you can better appreciate the utter lack of real reflation in the current one:
So much talk of the building inflationary monster when, in this market, the one that’s been (more) right about the world time and time again, it’s not even close. Any honest interpretation can only be modest.
Even the outer years, those 2023’s and 2024’s, supposedly well out of the reach of COVID, the market pricing in them is for the latter barely back to where it had been in early September 2019 (the “recession scare”), while the 2023’s haven’t even managed that much.
This December 2024 position is basically saying the first half of the decade of the 2020’s will somehow, on average, be materially worse than the 2010’s even if slightly better than the single and singly awful year 2020 had been where inflation and economic growth is concerned.
But that’s not the message you see all over the internet despite it being right here in the right market.
Thus, the eurodollar futures curve is incredibly low and flat, therefore like TIPS and inflation expectations in the longer terms, vehemently positioned for the all-too-sadly-likelihood that the only things which may have changed since COVID are more bad than good (see: deflationary labor market and lack of jobs).
And still no sign whatsoever of all that dollar-killing money printing. Like everything else, including the curve’s outer years, we’re turning Japanese.Link
Welcome to the BTC fold Goldman Sachs. Institutional FOMO kicking in. It’ll be interesting to see which Wall St firms have been quietly stacking when the Q1 reports are released over the next few weeks.
https://www.forbes.com/sites/jonathanponciano/2021/03/31/goldman-sachs-…
Good to see David zooming out and commenting on btc for the month of March. With news this week like this about goldman, visa taking settlements in ethereum, and PayPal enabling online transactions in Crypto, things continue to pick up pace in the journey of blockchain eating the financial system alive. The hard money is doing what it always does since time immemorial.
If you have a spare 1000$ I can guarantee us all to start a New BankNZ that will give a return of all your cash, no taxes paid and interest of 17% that will beat all Houses into a cocked hat and give all Politicians and Bankers a fright.
The New BankNZ will employ the unemployed made redundant by those Companies that used to be run offshore and helped raise the status of all millionaires and legendary creators of wealth achieved by starting Washing Machine Companies and producing Rinse Aid Materials for the said Companies. It used to be mainly a Swiss Banking Cartel that helped these Companies prosper, but I can assure you this New Bank will aid anyone with a spare 1000$ + to spare.
Please send a Blank Cheque with a signiture and and Name and address on the back and we will deposit in the New BankNZ and fulfill all obligations until this time next year, when you will recieve a Dividend and a Formal letter claiming you as a Member.
This will be based in Australia, online and you can deposit any amount when and if you give us your current Bank details and any risque assessment we need.
Thanks, April Furst.
Was surprised to see the Granny Herald article suggesting that people should be saving in Bitcoin if they want to to get into the property market or look at crypto to outperform property in general. The quotes from Adrian Orr saying that fiat money is toast and Ardern's admission that she's all in were stunning. Robertson was the odd one out saying that people should consider Treasury bonds.
More writing on the wall?
My Food Bag was issued at $1.85 here a couple of weeks back and headed straight down to $1.50 odd, but is Deliveroo another sign the days of free money working magic are over?
So much for full throttle, more like choke. For all the talk of motoring onto the London Stock Exchange, Deliveroo hasn’t just hit the skids, it’s swerved across several lanes of traffic during rush hour, collided with the central reservation and scattered the contents of its takeaway boxes over morning commuters.
Better to replace "country" in that quote with "government". We've seen what happens when governments ban Bitcoin in Nigeria - it drives local btc prices higher, and speeds adoption. All they're doing is removing any possibility of regulation from themselves. You simply just can't ban a virtual decentralised asset because central governance of the asset is required to ban it. And even that doesn't really work when it comes to virtual - take the pirate bay as a prime example.
George Gammon raises $100k in 36hrs to sue the Fed.
It's Time To Sue The Fed Under The Freedom Of Information Act (FOIA) #EndTheFed
Since 1913 the Fed has destroyed the purchasing power of the dollar, distorted the economy, created malinvestment, and incentivized misallocations of resources that have crushed the American poor and middle class.
Often they've implemented their destructive policies blatantly defying the document that legally binds them, the Federal Reserve Act of 1913.
https://www.gofundme.com/f/sue-the-fed?utm_source=facebook&utm_medium=s…
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And there is not enough evidence to tie up kneels on the neck (which seems unfortunate on the face) through cardio-pulmonary dysfunction with the underlying heart disease. No Actus Reus. No Actus Reus. With a cop, Mens Rea still has problems. This is known as fair doubt. The deposition hearing in NZ may not have passed.
https://iogames.onl https://iogames.onl/build-royale-io
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