‘I think we may have taken this ‘simplifying’ life thing a bit too far!’ ‘What do you think?’
U.S. bank boss warns world facing ‘most dangerous time in decades.’
The world may be facing ‘the most dangerous time… in decades’, bank boss Jamie Dimon has reportedly warned.
The chief executive of JP Morgan Chase told investors recently that he was concerned about the risks to the economy from rising geo-political tensions. He said wars in Ukraine and Israel could hit energy and food prices, and global trade.
Thousands have been killed in Israel and Gaza after an unprecedented attack by Palestinian militant group Hamas. Mr Dimon, who leads America’s biggest bank, was speaking as the firm revealed its latest quarterly results.
Banking the profits from higher interest rates
The bank reported $13 billion (£10.7 billion) in profit over the three months to September 2023, up 35% from the same period in 2022.
Dimon said the bank had benefited from U.S. households and business in healthy financial shape but warned that he remained cautious about the state of the global economy, given the many risks emerging. What about the effect of interest rate increases on profits the bank has benefitted from too?
‘My caution is that we are facing so many uncertainties out there,‘ he reportedly said. So helpful Mr. Dimon. He told investors they should be prepared to face higher interest rates, persistent inflation, as well as fallout from the violent conflicts.
How perceptive?
I wouldn’t necessarily call his comments very intuitive – interest, inflation and conflict is there for all to see.
Shame he didn’t use his super magical powers of detection to get ahead of the inflation problem earlier.
Global electricity energy demanded by BIG tech
Many large tech companies are planning to create their own energy supply or source power from 100% renewable generators.
BIG tech companies that are generating their own energy or investing in renewable energy projects
Apple
The company claims that it is already powered by 100% renewable energy across its global operations, including its data centres, offices, and retail stores. It also plans to become carbon neutral across its entire supply chain by 2030. Apple has invested in various renewable energy projects, such as solar farms in China, wind turbines in Denmark, and biogas fuel cells in the U.S.
The company has been matching its annual electricity consumption with renewable energy purchases since 2017, and aims to run on carbon-free energy 24/7 by 2030. Google has also been investing in renewable energy projects, such as offshore wind farms in Europe, solar plants in Chile, and geothermal power in Nevada .
Amazon
The company has committed to reaching net-zero carbon emissions by 2040, and to power its operations with 100% renewable energy by 2025. Amazon has also been investing in renewable energy projects, such as solar rooftops in India, wind farms in Ireland, and hydroelectric plants in Sweden.
Estimated current electricity demand
The global electricity energy demand is the amount of electricity that the world needs in a given day. It can be calculated by multiplying the average global electricity demand in GW by 24 hours. According to the International Energy Agency (IEA), the average global electricity demand in 2020 was about 3 TW or 3 000 GW. This means that the global electricity energy demand in 2020 was about 72000 GWh or 72 TWh per day.
However, this is an average value, and the actual demand may vary depending on the season, time of day, weather, and other factors.
Energy requirement
The global electricity energy demand is expected to increase in the future, as population grows and living standards improve. The IEA projects that the average global electricity demand will reach 3.8 TW or 3 800 GW by 2030 and 5.2 TW or 5 200 GW by 2050 in the Announced Pledges Scenario, which reflects the full implementation of net-zero emissions targets by some countries and regions. This implies that the global electricity energy demand will reach 91 200 GWh or 91.2 TWh per day by 2030 and 124 800 GWh or 124.8 TWh per day by 2050.
Energy sources to change
The sources of electricity generation will also change in the future, as renewable technologies such as solar PV and wind become more dominant and coal use declines. The IEA reports that the main sources of electricity generation in 2020 were coal (34%), natural gas (23%), hydropower (16%), nuclear (10%), wind (8%), solar PV (4%), biofuels and waste (3%), and other renewables (2%). In the Announced Pledges Scenario, renewables in electricity generation rise from 28% in 2021 to about 50% by 2030 and 80% by 2050.
‘The voice control system on mine is terrible, what’s yours like?’
Desert location for energy and power generation
Will these projects alter the world weather pattern?
According to a study, installing large-scale wind and solar farms in the Sahara desert could increase rainfall and vegetation in the region. The researchers simulated the effects of covering 20% of the Sahara with solar panels and wind turbines and found that it would trigger a feedback loop of more monsoon rain and more plant growth.
This could have benefits for the local environment and the global climate, as well as providing a huge amount of clean energy for the world.
Could it also create a detrimental effect to the ecosystem too?
10.5 GW solar energy
The desert project would produce 10.5 GW of solar power and 3 GW of wind power. However, there are also challenges and uncertainties involved, such as the cost, feasibility, and environmental impacts of such a massive undertaking.
The Sahara is a desert on the African continent. With an area of 9,200,000 square kilometres, it is the largest hot desert in the world and the third-largest desert overall, smaller only than the deserts of Antarctica and the northern Arctic.
Daily global electricity energy demand
The global electricity energy demand is the amount of electricity that the world needs in a given day. It can be calculated by multiplying the average global electricity demand in GW by 24 hours. According to the International Energy Agency (IEA), the average global electricity demand in 2020 was about 3 TW or 3 000 GW. This means that the global electricity energy demand in 2020 was about 72 000 GWh or 72 TWh per day. However, this is an average value, and the actual demand may vary depending on the season, time of day, weather, and other factors.
The global electricity energy demand is expected to increase in the future, as population grows and living standards improve. The IEA projects that the average global electricity demand will reach 3.8 TW or 3 800 GW by 2030 and 5.2 TW or 5 200 GW by 2050 in the Announced Pledges Scenario, which reflects the full implementation of net-zero emissions targets by some countries and regions. This implies that the global electricity energy demand will reach 91 200 GWh or 91.2 TWh per day by 2030 and 124 800 GWh or 124.8 TWh per day by 2050.
Energy sources
The sources of electricity generation will also change in the future, as renewable technologies such as solar PV and wind become more dominant and coal use declines. The IEA reports that the main sources of electricity generation in 2020 were coal (34%), natural gas (23%), hydropower (16%), nuclear (10%), wind (8%), solar PV (4%), biofuels and waste (3%), and other renewables (2%).
In the Announced Pledges Scenario, renewables in electricity generation rise from 28% in 2021 to about 50% by 2030 and 80% by 2050.
‘When I was 5 years old, my mother always told me that happiness was the key to life. When I went to school, they asked me what I wanted to be when I grew up. I wrote down ‘happy’. They told me I didn’t understand the assignment, and I told them they didn’t understand life’.
John Winston Ono Lennon. 1940 – 1980
John Lennon was an English singer, songwriter, musician and peace activist who gained worldwide fame as the founder, co-songwriter, co-lead vocalist and rhythm guitarist of the Beatles.
Lennon’s work included music, writing, drawings, and film. His songwriting partnership with Paul McCartney remains the most successful in history.
Microsoft $29 billion taxes dispute in U.S.
Microsoft has said it will contest a U.S. tax authority’s request to pay an additional $28.9 billion (£23.5 billion) in back taxes for the years 2004 to 2013.
The Internal Revenue Service (IRS) has been auditing how the firm allocates profits among countries and jurisdictions. Microsoft reportedly said, ‘the issues raised by the IRS are relevant to the past but not to our current practices‘.
Creative accounting?
There have long been concerns that the biggest corporations do not pay enough tax in developed nations. Big tech’ giants have been criticised for reporting lower profits in high-tax countries and higher profits in lower-tax jurisdictions to minimise their tax burden.
Microsoft reportedly said the IRS was seeking an additional tax payment of $28.9 billion plus penalties and interest. The company said it had ‘always followed the IRS’s rules and paid the taxes we owe in the U.S. and around the world‘. It said it believed that any taxes owed after the audit would be reduced by up to $10 billion based on tax laws passed by the former U.S. President.
Scrutiny
This year, Microsoft has also come under scrutiny from other U.S. authorities. In June, it agreed to pay $20m to the Federal Trade Commission (FTC) after the company was found to have illegally collected data on children who had started Xbox accounts.
Other American tech’ firms such as Amazon and Facebook have also faced similar calls to pay more taxes.
Microsoft’s new $69 billion Activision-Bizzard deal passes UK approval
Gaming industry’s biggest ever takeover deal
Microsoft’s $69 billion revised offer to buy Call of Duty-maker Activision Blizzard has been approved by UK regulators.
The Competition and Markets Authority (CMA) said the deal addressed its concerns, after the watchdog blocked the original $69bn (£59bn) bid in April 2023. The green light marks the culmination of a near two-year fight to secure the gaming industry’s biggest-ever takeover.
CMA criticised Microsoft’s conduct.
After the competition watchdog blocked the takeover earlier this year, Microsoft’s president hit out at the CMA’s decision which it said was ‘bad for Britain’.
The CMA chief executive reportedly said: ‘Businesses and their advisors should be in no doubt that the tactics employed by Microsoft are no way to engage with the CMA. Microsoft had the chance to restructure during our initial investigation but instead continued to insist on a package of measures that we told them simply wouldn’t work. Dragging out proceedings in this way only wastes time and money’.
The CMA also said the revised deal would ‘preserve competitive prices’ in the gaming industry and provide more choice and better services.
Prior to the approval, the deal, which makes Microsoft the owner of Call of Duty, World of Warcraft, Overwatch and Candy Crush, could not be finalised globally.
Under the restructured transaction, Microsoft will not acquire cloud rights for existing Activision PC and console games, or for new games released by Activision during the next 15 years. Instead, these rights will be divested to Ubisoft Entertainment before Microsoft’s acquisition of Activision, according to the CMA.
Vice Chair and President, Brad Smith seem happy after saying it would be ‘bad for Britain.
‘We’re grateful for the CMA’s thorough review and decision today. We have now crossed the final regulatory hurdle to close this acquisition, which we believe will benefit players and the gaming industry worldwide’.
Go count the money!
‘Everybody is a genius. But if you judge a fish by its ability to climb a tree, it will live its whole life believing it is stupid.’
Albert Einstein 1879 – 1955
UK debt costs now at 20 year high!
The interest the government pays on national debt has reached a 20-year high as the rate on 30-year bonds touches 5.05%.
A rise in the cost of borrowing comes at a difficult time for the chancellor, Jeremy Hunt, as he prepares for the autumn statement on 22nd November 2023. The chancellor has already made clear that tax cuts will not be announced in the autumn statement.
National debt £2,590,000,000,000
The total amount the UK government owes is called the national debt and it is currently about £2.59 trillion – £2,590,000,000,000.
The government borrows money by selling financial products called bonds. A bond is a promise to pay money in the future. Most require the borrower to make regular interest payments over the bond’s lifetime.
UK government bonds – known as ‘gilts’ – are normally considered very safe, with little risk the money will not be repaid. Gilts are mainly bought by financial institutions in the UK and abroad, such as pension funds, investment funds, banks and insurance companies.
QE
The Bank of England (BoE) has also bought hundreds of billions of pounds’ worth of government bonds in the past to support the economy, through a process called quantitative easing or QE.
A higher rate of interest on government debt will mean the chancellor will have to set aside more cash, to the tune of £23 billion to meet interest payments to the owners of bonds. This in-turn means the UK government may choose to spend less money on public services like healthcare and schools at a time when workers in key industries are demanding pay rises to match the cost of living.
Double debt
The current level of debt is more than double what was seen from the 1980s through to the financial crisis of 2008. The combination of the financial crash in 2007/8 and the Covid pandemic pushed the UK’s debt up from those historic lows to where it stands now. However, in relation to the size of the economy, today’s debt is still low compared with much of the last century.
The U.S, German and Italian borrowing costs also hit their highest levels for more than a decade as markets adjusted to the prospect of a long period of high interest rates and the need for governments around the world to borrow.
It follows an indication from global central banks, including the United States Federal Reserve and the Bank of England (BoE), that interest rates will stay ‘higher for longer’ to continue their jobs of bringing down inflation.
£111billion on debt interest in a year
During the last financial year, the government spent £111 billion on debt interest – more than it spent on education. Some economists fear the government is borrowing too much, at too great a cost. Others argue extra borrowing helps the economy grow faster – generating more tax revenue in the long run.
The Office for Budget Responsibility (OBR), has warned that public debt could soar as the population ages and tax income falls. In an ageing population, the proportion of people of working age drops, meaning the government takes less in tax while paying out more in pensions, welfare and healthcare services.
UK GDP grew in August 2023
U.K. Gross Domestic Product (GDP) grew by 0.2% in August, the Office for National Statistics (ONS) reported Thursday 12th October 2023, slightly recovering from a downwardly revised 0.6% contraction in July 2023.
Services output was the main contributor to growth in August 2023, adding 0.4% on the month to offset a fall in production output of 0.7% and a decline in construction output by 0.5%.
This data shows early signs of a cooldown in the labour market and thus, lower inflation further down the economic road.
Bank outlook
The data and outlook for the Bank of England (BoE) suggests that Bank rate increases do not have much upside from here and will most likely remain at current levels, but for a longer period.
The UK economy returning to growth in August 2023 has re-kindled expectations that interest rates will be left unchanged again in Novemeber 2023.
The economy grew marginally by 0.2% in August following a sharp fall in July 2023.
U.S. Wholesale inflation climbed 0.5% in September 2023, more than expected
Wholesale U.S. prices rose more than expected in September 2023, according to latest data released indicating that inflation remains a problem for the U.S. economy.
The producer price index (PPI), which measures costs for finished goods that producers pay, increased 0.5% for the month, higher than estimated for a 0.3% rise, the U.S. Labor Department reported Wednesday 11th October 2023.
Excluding food and energy, core PPI was up 0.3%, versus the forecast for 0.2%.
‘Rule Number One is never lose money. Rule Number two is never forget Rule Number One.’
Warren Buffet
Warren Buffet is one of the most successful investors and business owners in the world, and he has shared many of his insights and wisdom on money and investing.
This quote is just one of many…
IMF and UK interest and inflation fears
The International Monetary Fund (IMF) is an international organization that monitors the health of the global economy and provides financial assistance to countries in need.
UK interest rate warning from the IMF
- The IMF has warned that the UK faces another five years of high interest rates to stem rising prices, which have been falling but remain stubbornly above target.
- The IMF expects the UK to have the highest inflation and slowest growth next year of any G7 economies, which includes the US, France, Germany, Canada, Italy and Japan.
- The IMF says the UK’s immediate prospects are being weighed down by the need to keep interest rates high to control inflation, which is partly caused by the terms-of-trade shock from high energy prices, the aftereffects of the global pandemic, Brexit fallout and the Russia/Ukraine war.
Peak at 6%!
The IMF believes Bank of England rates will peak at 6% and stay around 5% until 2028. Rates are currently 5.25%.
If profit growth accelerates over the next two quarters – is it wise to buy the dip now?
Some analysts say yes!
Buying the dip means purchasing an asset, usually a stock, when its price has dropped. The expectation is that the drop is a short-term anomaly, and the asset’s price will soon go back up. It is a strategy that some traders and investors use to take advantage of price fluctuations and profit from market rebounds.
However, buying the dip can also be risky, as there is no guarantee that the price will recover or that the asset is not in a long-term downtrend. Therefore, it is important to do your research, use indicators, and have a risk management plan before buying the dip.
Current market situation and general ‘readout’
The S&P 500 is still ‘buy the dip’ for the next six months,’ some analysts suggest.
In some reports, it is expected that the profit cycle will be positive over the next six months and for data to improve before a consumer-spending led downturn leads to a selloff in U.S. stocks! That’s the ‘general’ readout.
Corporate profit expectations are behind much of that forecast for stocks. Analysts expect profit growth to accelerate over the next two quarters and see the S&P 500 in a range of 4,050 to 4,750. A mild recession in early or middle 2024 should lead to a higher risk premium, pushing the S&P 500 back close to 3,800. This is all conjecture.
Other analysts doubt the earnings uplift potential and anticipate stocks to fall back sooner as PE ratios sit at an already high level.
Take your pick
My view, for what it’s worth, is for stocks to climb for the time being through into the New Year and then to face pullback.
Truth is, no one knows. We can all make educated guesses.
Just watch the markets and be ready for the fall – that is coming for sure!
European banks in discussion with cryptocurrency companies
Bitstamp
Bitstamp has reportedly disclosed its ongoing discussions with a number of European banks about assisting them in launching cryptocurrency services. These discussions are expected to come to fruition in early 2024.
Bitstamp’s Negotiations with Top European Banks
Bitstamp’s negotiations underscore the growing acceptance of digital assets within the European financial sector.
This news comes at a time when the European Union is actively advancing its regulatory framework for cryptocurrencies, known as Markets in Crypto Assets (MiCA).
It aims at facilitating the entry of traditional financial institutions into the digital asset space.
Cybersecurity
Cybersecurity is a very important and relevant topic in today’s world. It refers to the practice of protecting systems, networks, and programs from digital attacks that can harm individuals and organizations.
Cyberattacks will all have malicious intent, such as accessing, changing, or destroying sensitive information; extorting money from users via ransomware; or interrupting normal business processes.
Cybersecurity aims to prevent or mitigate these attacks by using various technologies, measures, and practices.
There are many types of cybersecurity, depending on the domain or layer of IT infrastructure that needs to be protected.
Critical infrastructure security
This protects the computer systems, applications, networks, data and digital assets that a society depends on for national security, economic health and public safety. For example, the power grid, the water supply, the transportation system, the health care system, etc.
In the United States, there are some guidelines and frameworks for IT providers in this area, such as the NIST cybersecurity framework and the CISA guidance.
Network security
This prevents unauthorized access to network resources and detects and stops cyberattacks and network security breaches in progress. For example, firewalls, antivirus software, encryption, VPNs, etc. Network security also ensures that authorized users have secure access to the network resources they need, when they need them.
Application security
This protects applications from cyberattacks by ensuring that they are designed, developed, tested, and maintained with security in mind. For example, code reviews, vulnerability scanning, penetration testing, secure coding practices, etc. Application security also involves educating users about safe and responsible use of applications.
There are many more types of cybersecurity, such as cloud security, endpoint security, data security, identity and access management (IAM), etc. Each type of cybersecurity has its own challenges and solutions.
Companies to watch
Cybersecurity companies such as CrowdStrike, Okta, Zscaler and Palo Alto Networks are valuable assets with businesses willing to pay good money to protect against hackers.
NOTE: Always do your own very careful research – none of these ‘suggestions’ are ‘recommendations’.
Remember: RESEARCH! RESEARCH! RESEARCH!
Why was this allowed to happen?
Utterly shocking eye watering covid fraud related losses incurred through government incompetence.
The UK covid fraud amount is not a single figure, but rather a sum of various losses due to fraud and error across different government schemes and programmes.
List of government failures and waste
£21bn of public money lost in fraud since COVID pandemic began and most will never be recovered.
£34.5m stolen in pandemic scams by more than 6,000 cases of Covid-related fraud and cyber-crime.
£16bn lost due to fraud and error in Covid loans schemes.
£4.5bn in Covid-19 support lost to error and fraud since 2020.
Breathtaking incompetence
These figures are based on the reports and audits by the National Audit Office, the Action Fraud team, the HMRC, and other sources. However, they may not reflect the full extent of the problem, as some fraud cases may not be reported or detected.
The UK government has taken some measures to tackle fraud and recover the losses, such as creating the Public Sector Fraud Authority, the taxpayer protection taskforce, and the Dedicated Card and Payment Crime Unit.
The incompetence shown by the UK government is utterly breathtaking.
Dow up 300 points Friday, 6th October 2023 as stocks reverse sharp losses
Stocks rallied Friday 6th October 2023 even after the release of stronger-than-expected U.S. jobs data and an increase in Treasury yields.
The U.S. economy added 336,000 jobs in September 2023, the Labour Department said. Economists expected 170,000 jobs.
Confused?
Stocks posted a surprise turnaround on Friday, 6th October 2023 after initially falling on a hotter-than-expected jobs report. At its session low, the Dow had fallen some 270 points, then surged by more than 400 points at in intraday trading. The Nasdaq and the S&P 500 also lost ground too only but then quickly recovered the losses.
Unclear
Traders were unclear as to the reason for the intraday reversal. Some noted it could be the softer wage number in the jobs report that made investors rethink their earlier bearish stance. Others noted the pullback in yields from the day’s highs.
Rally
The rally may just be because the market had been extremely oversold with the S&P 500 at one point in the week down more than 8% from its high earlier this year.
Yields initially surged after the report, with the 10-year Treasury rate trading near its highest level in 16 years. The benchmark rate later eased from those levels, but was still up around 6 basis points at 4.78%.
Extreme market movements maybe here for a while yet.
U.S. jobs report September 2023
The latest U.S. jobs report for September 2023 was released on Friday, October 6, 2023.
The U.S. economy added 336,000 jobs last month, much more than expected, despite the Federal Reserve’s struggle to cool the world’s largest economy.
The unemployment rate was 3.8%, in line with August 2023. The data lifted hopes that the central bank will manage to guide the U.S. economy to a ‘soft landing’, where a recession is avoided. Bear in mind the Fed were late in dealing with the initial rise in inflation – so this battle has become harder and prolonged.
The job gains were the largest monthly rise since January 2023, and almost twice what economists had anticipated. Government and healthcare added the most jobs. The labour market still appears solid.
However, not all indicators were positive. The ADP’s national employment report showed that private-sector employers added only 89,000 jobs in September, far fewer than expected. Some factors outside the Fed’s control, such as the autoworker strike and the threat of a government shutdown, could yet damage the U.S. economy.
The labour force participation rate also remained low at 63.2%, indicating that many workers have yet to return to the labour market since the Covid19 pandemic of 2020.
‘You can discover more about a person in an hour of play than in a year of conversation’.
Plato
In Athens, Plato founded a philosophical school where he taught the philosophical doctrines that would later become known as Platonism.
Is the stock market on the verge of a big go green buy signal for a ‘mini’ rally?
Inflation and interest rate correlation
The stock market is influenced by many factors, such as economic data, earnings reports, geopolitical events, investor sentiment, and technical indicators.
Some analysts have suggested that the recent sell-off in the market may have created some oversold conditions that could lead to a relief rally or a bounce back in the near future.
Stochastics oscillation
One of the technical indicators that some traders use to identify buy and sell signals is the stochastics oscillator, which measures the momentum of price movements. The stochastics oscillator consists of two lines: the %K line and the %D line.
The %K line shows the current position of the price relative to its high and low range over a certain period of time, usually 14 days. The %D line is a moving average of the %K line, usually a three-day average. When the %K line crosses above the %D line, it is considered a bullish signal, indicating that the price may be reversing from a downtrend to an uptrend.
When the %K line crosses below the %D line, it is considered a bearish signal, indicating that the price may be reversing from an uptrend to a downtrend.
80/20 analysis
The stochastics oscillator also has two levels: 20 and 80. When the %K line falls below 20, it means that the price is oversold, meaning that it has fallen too much and may be due for a rebound. When the %K line rises above 80, it means that the price is overbought, meaning that it has risen too much and may be due for a pullback.
The FTSE 100 index, which tracks the performance of 100 large companies listed on the London Stock Exchange, has recently fallen below 20 on the stochastics oscillator, indicating that it may be oversold and ready for a bounce back.
No guarantee
However, this is not a guarantee, as other factors may also affect the market direction. Therefore, it is advisable to use stochastics in conjunction with other tools, such as trend lines, support and resistance levels, moving averages, and other technical indicators.
Additionally, some traders use different settings for the stochastics oscillator, such as changing the time period or the smoothing factor, to suit their own trading style and preferences. Always though, long term investing produces far better results over time as it smooths out the ‘ups and downs’.
In summary, there is no definitive answer to whether the stock market is building up to a major buy signal again right now, as different traders will have different opinions and strategies and views. But one possible way to gauge the market sentiment and momentum is to use the stochastics oscillator, which can provide some clues about potential reversals and opportunities in the market.
Note
This indicator should not be used in isolation, but rather in combination with other tools and analysis – it is just that, a tool. Good well-established companies that have good track records over many many years are a good place to look for long term returns. But even then, do your thorough research first.
So, what next?
The interest-rate/inflation correlation is crucial, because nominal company earnings grow faster when inflation is higher. That does not mean investors should welcome inflation, since higher inflation also means that future years’ earnings must be discounted at a higher rate.
But for many behavioural reasons, investors place greater weight on the negative impact of the greater discount rate than on the higher nominal earnings-growth rate that typically accompanies higher inflation.
Inflation illusion
Economists refer to this investor error as ‘inflation illusion’. Perhaps the seminal study documenting how this error impacts the stock market was conducted by Jay Ritter of the University of Florida and Richard Warr of North Carolina State University. They found that investors systematically undervalue stocks in the presence of high inflation.
Investors will make the same error, in reverse, when inflation and interest rates start to come down. That’s why the foundation of a likely big buy signal is currently being built.
Maybe the buy signal is about to go green for a quick buying opportunity. But be careful, in this environment it can switch again very quickly.
Remember, always do your own research carefully before buying.
Read: Bull market 1982 -1999 and decline of inflation. Jay Ritter of the University of Florida and Richard Warr of North Carolina State University.
RESEARCH! RESEARCH! RESEARCH!
U.S. mortgage rates closing in on 8%
The average rate on the popular 30-year fixed mortgage rose to 7.72% on Tuesday 3rd October 2023, according to latest data
Mortgage rates follow loosely the yield on the 10-year Treasury, which has been climbing this week following strong economic data. Rates have not been this high since the end of 2000.
At the beginning of this year, the 30-year fixed rate dropped mortgage to around 6%, creating a short-lived burst of activity in the spring 2023. But it began rising steadily again over the summer months, causing sales to drop, despite strong demand. The current trend appears to be even higher, with the possibility of rates reaching over 8%.
U.S. mortgage rates, which are close to 8% according to some sources. This is a very high level compared to the recent years, and it may have significant implications for the housing market and the economy.
Main points
Some experts believe that rates could reach 8% later by the end of October, and possibly stay at that level for the remainder of the year. Others, however, think that rates may stabilize or decline slightly if the economic growth slows down or inflation eases.
30 year fixed mortgage rate at 7.72%
The average rate on the popular 30-year fixed mortgage rose to 7.72% as of Oct. 3, according to Mortgage News Daily. This is the highest rate since 2000.
Rates are rising as more economic indicators point to a strong U.S. economy, which increases the likelihood of the Federal Reserve to hike rates further. The 10-year Treasury yield, which closely tracks the mortgage rates, reached 4.8% on Tuesday, the highest level since August 2007.
Hitting 8% will be like crossing a psychological barrier for many buyers, as it will increase their monthly payments and reduce their affordability. It may also dampen the demand for housing, which has already been affected by low inventory and high prices.
Some buyers are already seeing 8% mortgage rates, especially those who have high loan-to-value ratios, high balance-conforming loans, or non-qualified mortgage loans. These could also be borrowers with lower credit scores or non-prime borrowers.
A degree in ‘magic’ available at Exeter University
The University of Exeter is offering a master’s degree in magic and occult science – (what is occult science?). Available from September 2024.
First course of its kind in the UK
The course is said to be one of the first of its kind in the UK and aims to explore the history and impact of witchcraft and magic around the world on society and science.
The course leader, Prof Emily Selove, reportedly said that the course was created following a recent surge in interest in magic and the occult, (worrying) – inside and outside of academia. She also said that the course would allow students to re-examine the assumption that the West is the place of rationalism and science, while the rest of the world is a place of magic and superstition.
Institute of Arab and Islamic Studies
The course will be offered in the Institute of Arab and Islamic Studies and will involve academics from various disciplines such as history, literature, philosophy, archaeology, sociology, psychology, drama, and religion.
Some of the modules that students can choose from include dragons in western literature and art, the legend of King Arthur, palaeography, Islamic thought, archaeological theory and practice and the depiction of women in the Middle Ages.
Preparing students for a ‘teaching’ career amongst other options
The university said that the course could prepare students for careers in teaching, counselling, mentoring, heritage and museum work, work in libraries, tourism, arts organisations or the publishing industry, among other areas of work.
And you get one of these too…
To be perfectly honest, I really do not know what to think. This is for real!
Bed bugs in Paris!
Blood sucking insects
Bed bugs are small, blood-sucking insects that can infest homes, hotels, public transport, and other places where people sleep or rest. And Paris has its fair share at the moment.
They can cause skin irritation, allergic reactions, and psychological distress to their hosts. Bed bugs are not known to transmit any diseases, but they can be hard to irradicate once they establish.
Paris outbreak
According to some news reports, Paris is facing a ‘widespread’ outbreak that has been increasing over the past few years.
Some factors that may contribute to the problem
- Lack of awareness and prevention measures among the public and the authorities.
- Reduced use of pesticides, such as DDT, that were effective against bed bugs but harmful to the environment and human health.
- Increased globalisation, tourism, and immigration, which facilitate the spread of bed bugs through luggage, clothing, and furniture.
- Social media amplification of the problem, which may create panic and stigma.
Challenge
The bed bug issue in Paris may pose a challenge for the city’s image and reputation, especially as it prepares to host the 2024 Olympic Games. However, there are some solutions that can help prevent and control bed bug infestations.
Methods to control outbreaks
- Washing and drying your clothes and bedding at high temperatures after travelling or suspecting an exposure to bed bugs.
- Checking for signs of bed bugs before staying in a hotel or renting an apartment, such as dark spots, blood stains, or live insects on the mattress, sheets, or furniture.
- Sealing cracks or crevices where bed bugs may hide or enter your home.
- Avoiding bringing second-hand furniture or clothing into your home without inspecting them first.
- Calling a professional pest control service if you find bed bugs in your home or workplace.
Not just for Paris – probably coming to a city near you too… and soon.
This will take some time to fix.
‘You can dream, create, design, and build the most wonderful place in the world. But it requires people to make the dream a reality.’
Walt Disney 1901 – 1966
Walt Disney was an American animator, film producer and entrepreneur. A pioneer of the American animation industry, he introduced several developments in the production of cartoons. As a film producer, he holds the record for most Academy Awards earned and nominations by an individual.
