Macro Links Nov 28th – Bitcoin $10,000

Macro Links Nov 28th – Bitcoin $10,000

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BITCOIN $10,000

As Bitcoin Scrapes $10,000, an Investment Boom Like No Other – The New York Times

Whatever you want to call it, Bitcoin is on an extraordinary run, with the price of a single Bitcoin crossing $10,000 on some exchanges for the first time on Monday — less than two months after it crossed $5,000 for the first time.

It is a bull market with few precedents in recent investing history. The Dow Jones industrial average, in its biggest year, 1915, went up 82 percent, or one-tenth as much as Bitcoin has gone up this year. Amazon’s red-hot stock is up only one-fifteenth as much as Bitcoin this year.

The price has been pushed up by a flood of new buyers from around the world who think they have spotted a new kind of investment that could ultimately compete with gold as a place to store money outside the control of companies and governments.

Bitcoin Surges Past $9,500 in Fastest Thousand-Point Milestone – WSJ

Bitcoin rose as high as $9,732 Monday morning in New York, after surpassing the $9,000 milestone over the weekend, just seven days after the digital currency hit $8,000 according to research site CoinDesk. That marked the fastest thousand-point rally in bitcoin’s short history, surpassing the eight days it took to go from $3,000 to $4,000, and the nine days it needed to go from $5,000 to $6,000. Both of those moves occurred earlier this year.

Novogratz: ‘Bitcoin could be at $40,000’ by end of next year – Business Insider

To be sure, Novogratz doesn’t think the road to $40,000 will be without twists and turns. He said 50% corrections could happen on the way. Bitcoin was trading at $9,698 per coin at 6:21 p.m. ET, a bit shy of its all-time high of $9,733, according to data from Markets Insider. Bitcoin started the year just under $1,000.

This Is How You Can Short Bitcoin – Bloomberg

The options to short bitcoin are mostly through unregulated exchanges, and very risky given bitcoin’s volatility. Not to mention it hasn’t exactly been a good year for bitcoin bears given the 10-fold surge in price. But for those daring enough to try, there are ways to bet against bitcoin’s rise.

Bitcoin Guns for $10,000 as Cryptocurrency Mania Defies Skeptics – Bloomberg

“The weekend’s bitcoin price hike is just the continuation of a long-term bull run on the cryptocurrency, fueled by the tsunami of speculative trading on Japanese exchanges and the entrance of institutional investors across the world,” said Thomas Glucksmann, Hong Kong-based head of marketing at cryptocurrency exchange Gatecoin Ltd. “It is more likely that the $10,000 psychological stratosphere will push more institutional investors into the mix.”

Bitcoin nears $10,000 mark as hedge funds plough in | Technology | The Guardian

“The only way it has value is if the next guy is willing to pay you more for it – the greater fool. With no intrinsic value to bitcoin, it’s hard to see this as anything other than a giant speculative bubble.”

Bitcoin’s Trading Star Is Chicago High-Speed Firm That Nods to the Grateful Dead – WSJ

Founded in 1992, DRW employs more than 800 people and trades on exchanges around the world. About a quarter of its business involves high-frequency trading—running automated strategies over ultrafast network connections—although other strategies can involve trades that last for months or even years.

Based in a sleek Chicago skyscraper, DRW’s offices feel more like those of a Silicon Valley tech company than a Wall Street bank, with a casual dress code and weekly visits from a meditation teacher. As a nonbank firm that doesn’t manage money for outside investors, DRW is less subject to the regulatory questions looming over bitcoin than Goldman and other major banks.

Q&A: Why a Value Investor Decided to Buy Bitcoin – Barron’s

A central point in Stahl’s pro-Bitcoin argument: Traditional currencies can be “debased” as central banks print more of it and spark inflation, but there will be only 21 million Bitcoins ever made.

Microcap stocks surge on cryptocurrency promises

Three of the top four most actively traded U.S. stocks on Monday were all either riding a cryptocurrency-fueled surge, or pulling back from one.

Initial Coin Offerings Horrify a Former S.E.C. Regulator – The New York Times

“I.C.O.s represent the most pervasive, open and notorious violation of federal securities laws since the Code of Hammurabi,” Mr. Grundfest said in an interview. “It’s more than the extent of the violation,” he said. “It’s the almost comedic quality of the violation.”

Mr. Grundfest is far from the only voice who has criticized the frenzy around coin offerings. Chamath Palihapitiya, a venture capitalist who has expressed enthusiasm about Bitcoin, has said he thinks that “99 percent of I.C.O.s are a scam,” a sentiment that other leading venture capitalists have echoed.

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SUPREME COURT PATENT CASE

Supreme Court Debates a Patent Case That Is Splitting Corporate America – WSJ

The case stems from a much-touted process created by Congress in 2011 for challenging the validity of patents, in part as a response to complaints about the proliferation of so-called patent trolls, which routinely sue other firms for allegedly infringing on their patents.

Supreme Court Weighs Streamlined Patent Challenges – The New York Times

The procedure, created by Congress in 2011, resembles a trial in federal court but is conducted by an executive-branch agency. Supporters say it helps combat “patent trolls,” or companies that obtain patents not to use them but to demand royalties and sue for damages. Opponents say the procedure violates the Constitution by usurping the role of the federal courts, violating the separation of powers and denying patent holders the right to a jury trial.

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GOP TAX PLAN

Senate GOP tax bill hurts the poor more than originally thought, CBO finds – The Washington Post

The Senate Republican tax plan gives substantial tax cuts and benefits to Americans earning more than $100,000 a year, while the nation’s poorest would be worse off, according to a report released Sunday by the nonpartisan Congressional Budget Office.

Senators Scramble to Advance Tax Bill That Increasingly Rewards Wealthy – The New York Times

The Republican tax bill hurtling through Congress is increasingly tilting the United States tax code to benefit wealthy Americans, as party leaders race to shore up wavering lawmakers who are requesting more help for high-earning business owners.

On Monday, as Republican lawmakers returned to Washington determined to quickly pass their tax overhaul, senators were in feverish talks to resolve concerns that could bedevil the bill’s passage. With pressure increasing on Republicans to produce a legislative victory, lawmakers are contemplating changes that would exacerbate the tax bill’s divide between the rich and the middle class.

In Tax Debate, Gift to Religious Right Could Be Bargaining Chip – The New York Times

The change could turn churches into a well-funded political force, with donors diverting as much as $1.7 billion each year from traditional political committees to churches and other nonprofit groups that could legally engage in partisan politics for the first time, according to an estimate by the nonpartisan congressional Joint Committee on Taxation.

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ALABAMA SENATE RACE

Senate Race in Alabama Tests Reach of Trump’s Endorsement – The New York Times

President Trump has endorsed Roy Moore’s embattled campaign for a Senate seat. But even Republicans are skeptical of how much influence the president has.

Moore buried under TV ad barrage – POLITICO

The imbalance is stunning, with just two weeks to go in the campaign: Jones has aired more than 10,000 spots on broadcast TV in Alabama since the primaries, while Moore, the embattled GOP candidate, has run just over 1,000, according to figures compiled by Advertising Analytics.

Marine Colonel Announces Run Against Roy Moore: ‘Hold My Beer’

Lee Busby has launched a long-shot bid 15 days before Alabama chooses its next senator. ‘Alabama is not happy with the two choices we have down here. They are not appealing.’

A woman approached The Post with dramatic — and false — tale about Roy Moore. She appears to be part of undercover sting operation. – The Washington Post

Jaime Phillips, who claimed to The Post that Moore impregnated her as a teenager, was seen on Monday walking into the headquarters of Project Veritas, a group that uses false cover stories and covert video recordings to expose what it says is media bias.

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RUSSIA PROBE

Erik Prince, Blackwater Founder Said to Have Had Secret Meeting with Russian, Set to Testify Thursday | US News

The founder of the private military firm, who reportedly served as an unofficial Trump campaign adviser, is scheduled to appear before the House intelligence committee.

Michael Flynn’s lawyer meets with members of special counsel’s team, raising specter of plea deal – ABC News

Sources familiar with the discussions between Flynn’s legal team and Trump’s attorneys told ABC News that while there was never a formal, signed joint defense agreement between Flynn’s defense counsel and other targets of the Mueller probe, the lawyers had engaged in privileged discussions for months.

Michael Flynn’s role in Mideast nuclear project could compound legal issues – The Washington Post

Flynn’s quiet involvement in that project — and his failure to disclose his ties to the effort — could complicate the legal issues facing President Trump’s former national security adviser, who has signaled that he may be willing to cooperate with special counsel Robert S. Mueller III.

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CONSUMER PROTECTION BUREAU

Consumer Financial Protection Bureau Has 2 Bosses Claiming Control – The New York Times

It was the latest hill on a bureaucratic roller coaster that began with the abrupt departure on Friday of Richard Cordray, an Obama appointee who helped the agency aggressively expand its powers to punish rule-breaking companies. Mr. Cordray named Ms. English as his acting deputy director and presumed acting director. The White House responded forcefully by saying Mr. Mulvaney would be in control until Mr. Trump decided on a permanent successor, whose confirmation could take months.

Power struggle erupts at US consumer body

The power struggle recalled a tussle for control of the Department of Justice in the first weeks of the Trump presidency and was being watched closely on Wall Street, where banks complain they have been strangled by CFPB red tape.

CFPB Fight Goes to Court as English Sues to Block Trump Pick – Bloomberg

A federal judge must now decide which of the two people holding competing claims to temporarily run the U.S. Consumer Financial Protection Bureau has the actual authority to guide its oversight of American financial institutions.

Leandra English, who was deputy to ex-director Richard Cordray, asked a federal judge in Washington on Sunday to declare her as the agency’s acting director and to block President Donald Trump from installing White House budget director Mick Mulvaney as interim chief.

The court fight may determine whether the CFPB, an independent watchdog agency that has broad power over financial products including mortgages, student loans and credit cards, remains a prominent holdout from the Trump administration’s push to slash regulations.

White House budget director Mick Mulvaney orders freeze on hiring and rule-making on first day of assuming reins at Consumer Financial Protection Bureau – The Washington Post

White House budget director Mick Mulvaney said he ordered a 30-day hiring freeze and a delay of rule-making and other actions at the Consumer Financial Protection Bureau on his first day as boss of the consumer watchdog.

Whether he remains in charge that long remains unclear. A day earlier, the agency’s chief of staff Leandra English filed suit claiming she is the “rightful acting director” in the wake of former director Richard Cordray’s departure.

Advantage Trump in the battle over Obama’s Wall St watchdog

At its core, the fight over who heads the agency — Mr Mulvaney or Ms English — is about two radically different visions of government. On the one hand stands Ms Warren, a crusading Democrat with 2020 presidential ambitions who believes Wall Street defrauded the US middle class. On the other stands Mr Trump, who craves Wall Street’s approval and who is busy gutting many Obama-era regulations. For the time being Mr Trump has the advantage. Even if the courts send Mr Mulvaney packing, Mr Trump will still have the upper hand. All he need do is nominate another fox to guard the henhouse.

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RATES, LIQUIDITY, SYSTEMIC RISK, BALANCE SHEETS

The chance of a bitcoin crash is greater than 80% – MarketWatch

The researchers defined a bubble as a sharp price run-up over a two-year followed by at least a 40% drop over the subsequent two years. When the price run-up is 100% or more, they found the probability of a crash becomes 50%. When focusing on price run-ups of at least 150%, that probability becomes 80%. As price run-ups become even bigger, a crash becomes “nearly certain.” To put those thresholds in context, consider that bitcoin’s runup over the last two years is nearly 2,500%. That’s more than 10 times greater than the threshold the researchers found was associated with a “near certain” subsequent crash.

China’s Top Bond Fund Says Rout May Worsen – Bloomberg

It’s been the worst month for China’s local corporate notes in two years. And it might just be the start, as the nation’s top bond fund manager says yield premiums could rise further in 2018.

President Xi Jinping is stepping up efforts to trim the world’s largest corporate debt burden, after emerging even more powerful from the Communist Party’s twice-a-decade congress in October. Financial institutions are hoarding cash amid expectations the government will announce more measures to curb leverage, and that is pushing up borrowing costs in the money market.

17X28 - RISING CHINA YIELD GAP

Cautious trade follows fresh China stocks sell-off

“The global risk environment remains cautious with the latest story a potential wobble in Chinese markets,” said Viraj Patel, currency strategist at ING Bank. “Tightening financial conditions in China have instilled a broader sense of nervousness within global markets.”

How China’s Going to Try to Control Its Massive Housing Bubble – Bloomberg

An overheated real-estate sector is one of the prominent dangers to the world’s second-largest economy as policy makers step up efforts to tackle financial risks, now that the political hurdle of October’s 19th Communist Party Congress is cleared. Officials must judge how tightly to squeeze with ad-hoc curbs while trying to keep the economy humming and searching for long-term structural remedies, such as a property tax or a bigger rental market.

“Slowing property investment will drag on economic expansion,” said Wang Qiufeng, an analyst at China Chengxin International Rating Co., a ratings company part-owned by Moody’s Investors Service. “There is little sign that policy makers will relax curbs on home purchases.”

A Decade After the Crisis, King Dollar Is the World’s Tyrant – WSJ

It is one of the ironies of the global financial crisis: A decade later, a panic whose origins were in the U.S. has left the dollar more important to the rest of the world than ever before.

Putative contenders for its throne—the euro, the Chinese yuan—have failed to gain global acceptance. It remains the dominant force in world trade. A slow, yearslong decline in the proportion of dollars among the holdings of the world’s central banks, which were trying to diversify, has stopped. And the commercial banks of Japan, Germany, France and the U.K. now have more dollar-denominated liabilities than those in their own currencies.

The dollar dominance is testing the world again: Rules designed to make finance safer have already made dollars harder to come by. To add to the pain, the Federal Reserve is now sucking dollars out of the world’s financial system as it tries to tighten its monetary policy.

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MACRO OP-EDS, INSIGHT, EVENTS AND TRENDS

Bitcoin Bubble Makes Dot-Com Look Rational – Bloomberg Gadfly

Take dot-com stocks, which were the biggest bubble of the past few decades, and likely the largest in stock market history. At the height of the dot-com stock bubble, the technology-heavy Nasdaq stock index had a price-to-earnings ratio of 175. In the past year, bitcoins have generated transaction fees of nearly $219 million. And at $9,600 a piece, the total value of all bitcoins — their market cap — now tops $155 billion. That gives bitcoins the equivalent of a trailing P/E ratio of 708. That means based on valuation, bitcoins are four times more expensive than dot-com stocks were at the height of their bubble.

Scarcity is what bitcoin believers think they have going for them. The supply of bitcoins is supposed to max out at just 21 million, though in reality it’s likely to effectively grow much larger than that. But while the supply of bitcoins may be fixed, the supply of ways to invest in them and other cyrptocurrencies is certainly not. Earlier this year, a fork in the bitcoin blockchain, similar to what happens in a stock split, created bitcoin cash, which now has a market value of nearly $28 billion. Bitcoin gold, another fork created spinoff, has a market cap of about $6 billion. That’s not quite the $44 billion in dot-com IPOs, but it’s getting close. On top of that, ethereum, a bitcoin rival, has a market cap of $46 billion. Not to mention the hundreds of digital currency coins that have been launched this year. Coinmarketcap.com now lists 1,322 cryptocurrencies or offshoots on its website. There are also a number of companies that are looking to develop products based on the blockchain, bitcoin’s underlying technology. They will certainly like to sell stock to eager investors as well.

What Leonardo Tells You About Bitcoin – Bloomberg

Once the barriers to investment start to fall and any schmo can take a punt via their Charles Schwab account, don’t be surprised to see digital-currency prices go higher, at least temporarily. Just how high? Trying to guess such a thing is pointless in relation to any idea of fundamentals, but the ballpark figures you could back out from funds flows are eye-wateringly large. If the current vogue for bitcoin is just a quarter as powerful as the 2007-2011 run-up in gold, you could easily add another $400 billion to the current $300 billion crypto market cap.

It’s equally possible that the crypto market cap falls to $200 billion, or $100 billion, or less — but while individual digital currencies may well go to zero just as individual stocks do, at this point it’s becoming hard to argue the asset class as a whole will go permanently out of fashion (barring extraordinarily coordinated global government action to prohibit it).

That’s because people bid up the price of bitcoin for the same reason they flock to the best-performing mutual funds — they make the rookie error of assuming past performance is a guarantee of future returns. That motivation may be irrational, but it’s as old as investing. Trying to reason with it is as fruitless as asking the wind not to blow.

U.S. Economic Policy: The Storm after the Calm | International Selection Comment | Finanz und Wirtschaft

This is the worst possible time for cutting taxes. The U.S. economy is running at capacity, with unemployment, at 4.1 per cent, near all-time lows. Compared to when Ronald Reagan engineered his historic tax cuts, federal government revenue is already down by a tenth (17 per cent of GDP now compared to 19 per cent in 1981).

If tax reform happens, what will it mean for the economy? Perversely, the long-term impact on productivity will be strongly negative. Everyone, except perhaps for the Republicans in Congress, knows that education and training are the keys to productivity growth in the 21st century. But taxing university endowments, tuition breaks and interest on student loans, the Republican bill will make university education less accessible and affordable for the majority of Americans who will comprise the country’s future labor force.

Nor will there be a surge of business investment boosting productive potential. The cost of capital is already low, given rock-bottom interest rates. Expensing of capital expenditures will make little difference, since interest on debt issued to finance investment can already be deducted from profits. U.S. corporations are swimming in cash, so foreign profits repatriated as a result of the plan will go into share buybacks, not new investment. These are facts that Trump’s advisor Gary Cohn learned to his chagrin on November 15th, when corporate bigwigs attending the Wall Street Journal’s CEO Council, asked to raise their hands if they intended to increase their companies’ investment, sat silently in their seats.

Driverless cars may kill off the world’s deadliest invention

About 1.25m people are killed in road traffic accidents a year, accounting for 2.2 per cent of all deaths globally, according to the World Health Organization. Accurate data on how many people in total have been killed by cars in the past century are hard to find. But 50m seems a fair guess. That compares with the 123m in all wars in the 20th century.

If that level of carnage were not bad enough, cars have also contributed massively to environmental pollution and adverse climate change. As an additional malus, the car’s thirst for oil has handed billions of dollars in revenues to some of the world’s most regressive regimes: Saudi Arabia, Russia and Venezuela.

Fortunately, the end of the human-driven, petrol-fuelled car may be in sight. Some computer scientists describe driverless car technology as essentially a “solved problem”, even if huge challenges remain before car companies are confident enough to launch fully autonomous passenger vehicles on to the road. Protocols still need to be worked out to determine how one driverless car will interact with another and how to prevent hacking.

OPEC’s Clash With U.S. Oil Is Nearing Its Day of Reckoning – Bloomberg

The U.S. shale revolution is on course to be the greatest oil and gas boom in history, turning a nation once at the mercy of foreign imports into a global player. That seismic shift shattered the dominance of Saudi Arabia and the OPEC cartel, forcing them into an alliance with long-time rival Russia to keep a grip on world markets.

So far, it’s worked — global oil stockpiles are draining and prices are near two-year highs. But as the Organization of Petroleum Exporting Countries and Russia prepare to meet in Vienna this week to extend production cuts, ministers have little idea how U.S. shale production will respond in 2018.

“The production cuts are effective — it was absolutely the right decision, and the fact of striking a deal with Russia was crucial,” said Paolo Scaroni, vice-chairman of NM Rothschild & Sons and former chief executive officer of Italian oil giant Eni SpA. Nonetheless, “OPEC has not the same power. The U.S. becoming the biggest producer of oil in the world is a dramatic change.”

The strange geopolitics of rising oil prices – The Economist explains

Besides OPEC and geopolitics, there are other reasons oil prices are on a roll. A synchronous upswing in the global economy means that demand for oil is rising. The International Energy Agency, a global forecaster, recently spooked the market by saying that higher prices were likely to dent consumption of crude next year. That is possible, but with prices still at less than half their peak of 2008, consumers, such as drivers, show no sign yet of jamming on the brakes. Rising global demand and falling OPEC supply may yet flush out more American shale production, which is the main bugbear of oil bulls. Martijn Rats of Morgan Stanley says that to keep the market roughly in balance, shale-producers will have to raise output from 5.8m barrels a day (b/d) to 6.8m b/d over the next 12 months, a 17% increase. However, he notes that a bottom-up analysis of listed shale-producers suggests their production is only growing at about 5% a year, which is not enough to fill the gap. Rather than continuing to pump as fast as they can, they are now focusing on pumping more profitably.

The Case for Not Being Born | The New Yorker

David Benatar may be the world’s most pessimistic philosopher. An “anti-natalist,” he believes that life is so bad, so painful, that human beings should stop having children for reasons of compassion. “While good people go to great lengths to spare their children from suffering, few of them seem to notice that the one (and only) guaranteed way to prevent all the suffering of their children is not to bring those children into existence in the first place,” he writes, in a 2006 book called “Better Never to Have Been: The Harm of Coming Into Existence.” In Benatar’s view, reproducing is intrinsically cruel and irresponsible—not just because a horrible fate can befall anyone, but because life itself is “permeated by badness.” In part for this reason, he thinks that the world would be a better place if sentient life disappeared altogether.

The knee-jerk response to observations like these is, “If life is so bad, why don’t you just kill yourself?” Benatar devotes a forty-three-page chapter to proving that death only exacerbates our problems. “Life is bad, but so is death,” he concludes. “Of course, life is not bad in every way. Neither is death bad in every way. However, both life and death are, in crucial respects, awful. Together, they constitute an existential vise—the wretched grip that enforces our predicament.” It’s better, he argues, not to enter into the predicament in the first place. People sometimes ask themselves whether life is worth living. Benatar thinks that it’s better to ask sub-questions: Is life worth continuing? (Yes, because death is bad.) Is life worth starting? (No.)

South Korea’s penniless pensioners face final years in crisis

Poverty afflicts almost half of Korea’s elderly — a generation that was once the lifeblood of the country’s remarkable postwar transformation into an advanced economy. With the basic monthly state pension of Won200,000 barely sufficient for food and lodging, many resort to menial or degrading jobs to make ends meet.

Some even resort to prostitution. In a leafy park nestled beneath the high-rises of downtown Seoul, women as old as 80 seek clients to take to the neighbourhood’s rundown motels. The “Bacchus Ladies”, named after the energy drink they flog as an opening gambit, have come to symbolise the profound demographic challenges facing the rapidly ageing Asian nation.

In Its New World, the EU’s Threats Come From Outside Its Borders – WSJ

The EU today finds itself grappling with unfamiliar challenges. Many of the biggest risks it now faces are external and cannot be addressed simply by extending the scope of EU rule-making. The migration crisis, for example, which has its origins in instability and poverty in the Middle East and Africa, remains an existential crisis for the EU, fueling support for anti-EU populist parties. The EU must also contend with Russian aggression in Eastern Europe, which some argue came in response to over-reach by the EU, and its attempt to destabilize the EU itself. And it must forge a new relationship with the U.K.—an internal problem soon to become an external one.

How a Radio Shack Robbery Could Spur a New Era in Digital Privacy – The New York Times

The case that could transform privacy law in the digital era began with the armed robbery of a Radio Shack store in Detroit, a couple of weeks before Christmas in 2010. In the next three months, eight more stores in Michigan and Ohio were robbed at gunpoint.

The robbers took bags filled with smartphones. Their own phones would help send them to prison.

On Wednesday, the Supreme Court will consider whether prosecutors violated the Fourth Amendment, which bars unreasonable searches, by collecting vast amounts of data from cellphone companies showing the movements of the man they say organized most of the robberies.

If No One Owns the Moon, Can Anyone Make Money Up There? – The New York Times

The treaty spells out what countries are and are not allowed to do in space. Its crowning achievement was stopping the nuclear arms race between the United States and the Soviet Union from expanding into space. But the agreement may now be getting in the way of entrepreneurs with plans to push farther and faster into space than national agencies like NASA.

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CENTRAL BANKS & MONETARY POLICY

Powell Seeks to Support Economy, Defend Fed Independence – WSJ

Federal Reserve governor Jerome Powell would strive to support the economy’s progress toward full recovery and defend the central bank’s independence if confirmed as its next leader, he will tell a Senate panel Tuesday when it considers his nomination.

Powell sends message of Fed continuity to senators

Jay Powell will set the stage for further increases in interest rates while stressing the need to respond flexibly to unexpected events when Donald Trump’s nominee to take over the chairmanship of the Federal Reserve faces his confirmation hearing on Capitol Hill on Tuesday.

The Fed’s Temporary Tool to Keep Rates Above Zero Still Has Its Uses – Bloomberg

The Federal Reserve facility that offers investors a fixed rate for parking cash overnight is dwindling in popularity and the central bank has said that it intends to phase it out when it’s no longer needed. It isn’t going to disappear for now though.

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USA ECONOMY DATA, CITIES AND STATES

Entry-Level Buyers Drive Solid New Home Sales – WSJ

Sales of newly built homes rose in October for the second consecutive month, driven by demand for entry level homes. The advance supports a longer-term positive trend in the market. In all, new home sales were up 8.9% in the first 10 months of the year from the same period last year and have jumped 18.7% in the past 12 months.

U.S. new home sales scale 10-year high; supply still tight

Sales of new U.S. single-family homes unexpectedly rose in October to hit a 10-year high amid robust demand across the country, offering a boost to the housing market.

Immigrants to America are better educated than ever before – Six degrees and separation

According to the OECD (a club of mostly wealthy countries), the number of college-educated migrants heading to member countries grew by 70% between 2001 and 2011. Recent migrants to America are as likely to be highly educated as those who move to Europe are. They still lag some way behind Australia and Canada, though.

U.S. Cyber Monday sales jump 17 percent, on pace for record

Cyber Monday was on track to become the biggest-ever internet shopping day in the United States as shoppers snapped up bargains on toys and electronics, with many more Americans shopping on their phones.

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GLOBAL ECONOMY DATA

Mexico Registered $2.07 Billion Trade Deficit in October – WSJ

Mexico ran up a $2.07 billion trade deficit in October, more than double the shortfall in the year-earlier month as petroleum imports continued to rise, offsetting gains in shipments abroad of manufactured goods.

Corporate Japan hit by severe labour shortages

One way companies are tackling shortages is by offering more generous permanent contracts, which provide job security and pension benefits. That policy has broken a decades-long trend towards more part-time and contract work.

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POSITIONING, INFLECTION, MARKET CALLS

Stock market volatility to return in 2018, Morgan Stanley says – Business Insider

The volatility that has escaped markets this year will be back in 2018, the firm’s equity analysts forecast. This year is on track to go down as one of the most peaceful in market history. The CBOE Volatility Index fell to a record low of 8.56 on Black Friday’s short day of trading.

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DEALS, MERGERS, IPOs, LBOs, RESTRUCTURINGS

Meredith looking to dismantle Time Inc after $2.8bn takeover

Among those who have expressed interest in Time assets in recent months are David Pecker, publisher of the National Enquirer tabloid and a close ally of President Donald Trump; a team including Seagram scion Edgar Bronfman Jr and Len Blavatnik, the billionaire former owner of Warner Music Group; and Jimmy Finkelstein, owner of the political publication The Hill.

SoftBank Bids to Buy Uber Shares for 30% Less Than Current Value – Bloomberg

SoftBank Group Corp. and a coalition of investors will offer to buy shares in Uber Technologies Inc. at a price that would value the ride-hailing company at 30 percent less than its most recent $69 billion valuation, according to two people familiar with the matter.

SpaceX Raises $100 Million More – WSJ

Elon Musk’s SpaceX has spearheaded the move toward private companies building and launching rockets in the space industry. The Hawthorne, Calif.-based company in July raised $350 million in a funding round that would value the company at about $21 billion, The Wall Street Journal previously reported. That marked a leap from the previous valuation of $12 billion set in a 2015 funding round from Alphabet Inc. and Fidelity Investments.

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REAL ESTATE, HOUSING, REITS, COMMERCIAL

London Homes Are Now Less Affordable Than Ever Before – Bloomberg

London homes are less affordable than ever before, despite slowing price growth and government attempts to cut the cost of housing for first-time buyers.

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ENERGY CRUDE OIL, OIL SANDS, SHALE

Goldman calls outcome of upcoming OPEC meeting uncertain

The outcome of the OPEC meeting in Vienna later this week is uncertain given current crude prices and a lack of consensus on an output cut extension deal, Goldman Sachs said on Monday.

Oil Sleeps Through Saudi-Iran Spat and Imminent OPEC Meeting – Bloomberg

With tensions between Saudi Arabia and Iran ratcheting up and OPEC about to announce its plans for global crude supply, investors would be forgiven for anticipating a few gyrations in oil prices. The opposite has happened: the market is the calmest it’s been for almost nine months.

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COMMODITIES PRECIOUS METALS

U.S. Mint’s Gold and Silver Coins Turn to Lead for Some Retirement Investors – WSJ

After years of making pennies and nickels that cost more to produce than they are worth, the Treasury Department is making a mint off a line of pricey American Eagle coins in what is known as proof condition—sheathed in plastic and never touched by human hands. But some investors say it’s a rip-off.

Mint officials said they pitch proof coinage as collector’s items, not investments. But Congress kept the door open to putting the coins into retirement account investments a few years after banning other collectible items in 1981.

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COMMODITIES AGRICULTURE & SOFTS

Whole Foods Chicken Supplier Plans to Triple Its Output With Organic Booming – Bloomberg

Americans can’t seem to get enough organic chicken, driving the U.S.’s oldest chicken brand to break ground on a new plant in the Northeast. Bell & Evans, a supplier to Whole Foods Market Inc., is set to triple its total production by constructing a new Pennsylvania processing facility, with an eye to increasing its organic output along with more flavorful birds. The 560,000-square-foot plant is scheduled to open in early 2020 with capacity to process 2.6 million birds a week, according to a statement Monday.

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POLLUTION, CLIMATE & ENVIRONMENT

Bali Volcano Eruption Triggers More Evacuations – The New York Times

Officials in Indonesia say 100,000 people on the island of Bali need to be evacuated from a danger zone around the Mount Agung volcano, which has begun erupting and sending dark clouds of ash into the air.

Volcanic activity is now at a very high level, and the probability of a bigger eruption is increasing, Indonesia’s Center for Volcanology and Geological Hazard Mitigation said. Just how big can’t be determined, in part because there is so little information about what sort of activity came before the last deadly eruption in 1963.

Extreme weather-pattern change may mean cold and stormy mid-December in eastern U.S. – The Washington Post

Record warm weather is forecast in the central United States, and the unseasonably mild weather should spread east as November comes to a close and December begins. But in roughly 10 days to two weeks, models are advertising a radical change in the weather pattern that will put a big smile on the face of those who enjoy cold and snowy weather in the eastern United States.

In Peru’s Deserts, Melting Glaciers Are a Godsend (Until They’re Gone) – The New York Times

Accelerating glacial melt in the Andes caused by climate change has set off a gold rush downstream, letting the desert bloom. But as the ice vanishes, the vast farms below may do the same.

The Most Expensive U.S. Hurricane Season Ever: By the Numbers – Bloomberg

This year’s U.S. Atlantic hurricane season is officially the most expensive ever, racking up $202.6 billion in damages since the formal start on June 1.

The thawing Arctic threatens an environmental catastrophe – Skating on thin ice

The thaw is happening far faster than once expected. Over the past three decades the area of sea ice in the Arctic has fallen by more than half and its volume has plummeted by three-quarters. SWIPA estimates that the Arctic will be free of sea ice in the summer by 2040. Scientists previously suggested this would not occur until 2070. The thickness of ice in the central Arctic ocean declined by 65% between 1975 and 2012; record lows in the maximum extent of Arctic sea ice occurred in March.

The world is drowning in ever-growing mounds of garbage – The Washington Post

The world now produces more than a billion tons of garbage a year, which it incinerates and buries and exports and recycles. In New York, barges transport as much as 3,600 tons of waste down the Hudson River every day. In the Netherlands, which has a sophisticated recycling system, residents throw away the equivalent of more than 400,000 loaves of bread per day. In Jakarta, residents refer to the Indonesian city’s growing dump simply as “the Mountain.”

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EUROPE

After Tumultuous Week, Germany’s Politics Look to the Familiar – The New York Times

After a week of upheaval and uncertainty, Chancellor Angela Merkel turned to her old coalition partners in hopes of returning stability to Germany’s political scene by raising the prospect of giving the country the same government that has led since 2013.

In an overture to the Social Democrats, Ms. Merkel, leader of the center-right Christian Democratic Union, moved away from her previous talk of possible new elections. Instead she welcomed the chance to accept an invitation from President Frank-Walter Steinmeier to sit down to talks, and pledged to work toward opening formal coalition negotiations as quickly as possible.

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JAPAN

Tokyo, Once a Cigarette Haven, Could Finally Kick Out the Smokers – The New York Times

As more people have grown aware of the health hazards, the number of smokers in Japan has dropped sharply, according to data from the cigarette maker Japan Tobacco. And an increasing number of employers, restaurant owners and public facilities throughout the country have voluntarily banned cigarettes after a 2002 bill that encouraged a reduction in passive smoke.

A more drastic step may be in store. Early next year, Tokyo’s metropolitan assembly will vote on whether to ban smoking indoors in most public places, including restaurants, hotels, offices, department stores, airports, universities and gyms. Outside, smokers would be restricted to specially designated shelters or zones.

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GEOPOLITICS, CRIME, TERRORISM

Bill Gates Calls Detained Saudi Prince Alwaleed an ‘Important Partner’ – Bloomberg

Bill Gates said that Saudi Arabia’s Prince Alwaleed bin Talal, who was arrested as part of the kingdom’s anti-corruption drive this month, has been an “important partner” in charitable work to improve health conditions around the globe.

Brussels rattled as China reaches out to eastern Europe

The lure for central and eastern European nations is clear. Since 2012, Chinese companies, backed by state banks, have announced an estimated $15bn in investments in infrastructure and related industries, according to data collected by the Center for Strategic and International Studies, a Washington think-tank, in co-operation with the Financial Times. “To China, the 16 countries are important in their own right but also as a bridge into the EU,” says Jonathan Hillman, director of the CSIS Reconnecting Asia Project.

New sanctions are about to bite, and Russia’s elite are spooked – Putin in the boot

It is the personal sanctions that worry the Russian elite most. CAATSA allows “secondary sanctions”, meaning that American officials can go after anyone, in any country, with significant business dealings with the so-called “specially designated nationals” (SDNs) who are already under sanctions—such as Igor Sechin, the head of Rosneft, the state oil firm, and Gennady Timchenko, an oligarch with interests in transport and energy. Depending on how CAATSA is implemented, this could make some of Mr Putin’s closest allies and cronies as toxic as other SDNs in Hizbullah, Iran or North Korea. A Chinese energy firm or a Western consultant dealing with any of the Russian SDNs could be affected. “This is absolutely nuclear,” says a Russian official. “It goes beyond anything we had during the cold war.”

New York trial threatens to aggravate Turkey-US relations

Turkey’s frayed relationship with the US may be about to snap as an inflammatory court case begins in New York, adding a new grievance to President Recep Tayyip Erdogan’s fury at Washington.

The trial, centred on Reza Zarrab, a prominent Turkish-Iranian gold dealer with ties to senior government officials, is set to examine whether he and other Turks broke US sanctions against Iran by using gold to buy Iranian oil and gas in a multibillion-dollar scheme over five years from 2010 to 2015.

Pakistan Law Minister Quits to End Islamist Standoff – WSJ

Pakistan’s law minister resigned on Monday, in an agreement with religious activists to end three weeks of demonstrations that shook an already fragile government, the state broadcaster and the protesters said.

Two Former Mugabe Allies Are Held Without Bail in Zimbabwe – The New York Times

Their cases are being closely watched for signs about how the new government will deal with former allies of the ousted president.

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PRIVACY, HACKING, CYBERWAR, SURVEILLANCE STATE

Uber Hack Fallout: Illinois Sues, Senators Ask for Answers – WSJ

Uber Technologies is facing mounting pressure from regulators and lawmakers over the year-old data breach it disclosed last week that affected some 57 million riders and drivers.

US charges three Chinese nationals over hacking

The US has charged three Chinese nationals for hacking Moody’s Analytics, Siemens and GPS maker Trimble, accusing them of stealing sensitive information including emails of a prominent employee at Moody’s and intellectual property.

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PROPAGANDA, CORRUPTION, AUTHORITARIANISM

Protest Targeting Opposition Lawmakers Stirs Outrage in Poland – The New York Times

Pictures of Polish opposition lawmakers shown on symbolic gallows have stirred memories of the intolerant politics of Poland’s not-so-distant past.

Vietnamese Blogger Gets 7 Years in Jail for Reporting on Toxic Spill – The New York Times

A chemical spill that devastated the coast of central Vietnam last year claimed another casualty on Monday when a 22-year-old blogger was sentenced to seven years in prison for posting reports on the disaster.

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TRUMP WORLD

Another Hotel Moves to Strip Away Trump’s Name – Bloomberg

The Trump Organization said its luxury hotel in Panama is legally required to keep the Trump brand following an Associated Press report that the 70-story building’s owners are trying to remove it, the third such effort this year.

CNN hits back at Trump after criticism of foreign reporting – POLITICO

Critics at the network say the president’s tweets endanger journalists in countries hostile to a free press.

Trump Again Derides Warren as ‘Pocahontas,’ This Time at Event Honoring Navajo Veterans – The New York Times

Standing in the Oval Office alongside three World War II code talkers, Mr. Trump made the unscripted comment after other officials praised the veterans’ history and contributions.

White House Weighs Personal Mobile Phone Ban for Staff – Bloomberg

The White House may ban its employees from using personal mobile phones while at work, raising concerns among some staffers including that they’ll be cut off from family and friends, according to seven administration officials.

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ELECTORAL POLITICS

Al Franken, Battling for His Political Life, Apologizes for Groping – The New York Times

Responding to accusations of serial groping, Senator Al Franken tells women and the press that he is “tremendously sorry” and vows to regain women’s trust.

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BANKS, BROKERS, INSURANCE, EXCHANGES

Wells Fargo Bankers, Chasing Bonuses, Overcharged Hundreds of Clients – WSJ

Employees say lofty rewards tied to revenue pushed foreign-exchange staff to ignore agreed-upon fees. Years of whispers were confirmed in a conference call.

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RETAIL APPAREL, SPECIALTY, DINING, BIG BOX

Amazon, in Hunt for Lower Prices, Recruits Indian Merchants – The New York Times

Thousands of Indian sellers have shipped bedding, jewelry, kitchenware and clothing to Amazon warehouses to serve bargain-hunting Americans.

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AUTOS, ELECTRIC, SELF-DRIVING

Tesla truck will need energy of 4,000 homes to recharge, research claims

Other experts in battery technology have claimed that charging a truck in half an hour would require technology exceeding anything available.

“The fastest chargers today can support up to around 450kW charging, so it’s not clear yet how Tesla will achieve their desired charging speeds,” said Colin McKerracher, head of advanced transport at Bloomberg New Energy Finance, a consultancy. “One option may be to segment the battery somehow and actually charge different segments simultaneously. This adds additional costs and we haven’t seen anything like that done at anywhere near this power output.”

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ARTIFICIAL INTELLIGENCE, DRONES, FUTURE TECH

Facebook rolls out AI to detect suicidal posts before they’re reported | TechCrunch

Facebook’s new “proactive detection” artificial intelligence technology will scan all posts for patterns of suicidal thoughts, and when necessary send mental health resources to the user at risk or their friends, or contact local first-responders. By using AI to flag worrisome posts to human moderators instead of waiting for user reports, Facebook can decrease how long it takes to send help.

Samsung hails ‘graphene ball’ battery success

Samsung Electronics has developed core battery technology using graphene to make lithium-ion batteries last longer and charge more quickly, a potential industry milestone if mass produced.

Samsung said the graphene-based battery would take just 12 minutes to be fully charged; current lithium-ion batteries take about an hour. The new battery could also be used for electric vehicles, as it can maintain stability at up to 60 degrees Celsius.

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SCIENCE, NATURE, PSYCHOLOGY

Conserve elephants. They hold a scientific mirror up to humans

Within a group, most adult females have, at any given moment, a single, dependent calf. They will not give birth again until this offspring is self-sufficient, which takes about four years. From a male point of view, sexually receptive females are therefore a rare commodity, to be sought out and often fought over. Such competition means that, though capable of fatherhood from the age of about 14, a male will be lucky to achieve it before he is in his 20s. Until that time arrives, he will be seen off by stronger rivals.

Were this all there was to elephant society, it would still be quite complex by mammalian standards—similar in scope to that of lions, which also live in matriarchal family groups that eject maturing males. But it would not deserve Dr Wittemyer’s accolade of near-human sophistication. Unlike lions, however, elephants have higher levels of organisation, not immediately obvious to the observer, that are indeed quite humanlike.

First of all, families are part of wider “kinship” groups that come together and separate as the fancy takes them. Families commune with each other in this way about 10% of the time. On top of this, each kinship group is part of what Dr Douglas-Hamilton, a Scot, calls a clan. Clans tend to gather in the dry season, when the amount of habitat capable of supporting elephants is restricted. Within a clan, relations are generally friendly. All clan members are known to one another and, since a clan will usually have at least 100 adult members, and may have twice that, this means an adult (an adult female, at least) can recognise and have meaningful social relations with that many other individuals.

A figure of between 100 and 200 acquaintances is similar to the number of people with whom a human being can maintain a meaningful social relationship—a value known as Dunbar’s number, after Robin Dunbar, the psychologist who proposed it. Dunbar’s number for people is about 150. It is probably no coincidence that this reflects the maximum size of the human clans of those who make their living by hunting and gathering, and who spend most of their lives in smaller groups of relatives, separated from other clan members, scouring the landscape for food.

Dealing with so many peers, and remembering details of such large ranges, means elephants require enormous memories. Details of how their brains work are, beyond matters of basic anatomy, rather sketchy. But one thing which is known is that they have big hippocampuses. These structures, one in each cerebral hemisphere, are involved in the formation of long-term memories. Compared with the size of its brain, an elephant’s hippocampuses are about 40% larger than those of a human being, suggesting that the old proverb about an elephant never forgetting may have a grain of truth in it.

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HEALTH, PRODUCTIVITY AND WELLNESS

Why Your Brain Feels So Foggy From Sleep Deprivation

A small new study from UCLA offers some intriguing clues about why we feel so dopey after a night of lost sleep. It looked at the activity of individual brain cells in sleep-deprived patients, and saw that the cells’ behavior changed as the night wore on—and this was directly mirrored in a decline in the participants’ performance on a cognitive task. The researchers point out that the changes in cognitive performance that come with sleep deprivation is quite similar to the decline that comes from alcohol use.

Whether studies like this will lead to shifting standards or policy remains to be seen. In the meantime, it gives an interesting new perspective to sleep deprivation: When we’re dragging after a night of lost sleep, now we know that it may be because our brain cells are feeling groggy and under-performing themselves.

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MISCELLANEOUS

Prince Harry Is Engaged to Meghan Markle – The New York Times

The prince, a grandson of Queen Elizabeth II, and Ms. Markle, an American actress, will be married in the spring, the royal family said.

‘Ghost ship’ of decomposed bodies washed ashore in Sea of Japan

The grim finding is the latest in a recent spate of accidents, which experts say could be down to food shortages in North Korea.

A flat-Earther’s plan to launch himself in a homemade rocket has been postponed — again – The Washington Post

Mike Hughes said he has been sleeping in the rocket launcher every night, waiting for ideal launch conditions.

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