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The major flaw in the global system (there are a few, so let me be brief) The supply coming from China (and then we work through the raw material side going to china sometime later)
Coronavirus has disrupted supply chains for nearly 75% of U.S. companies
The COVID-19 outbreak has caused supply chain disruptions for nearly three-quarters of U.S. companies, and many are already pricing in revenue losses this year as a result, according to a special ISM survey.
What's happening: Data show global production out of China fell to an all-time low last month, with freight and shipping slowing dramatically as the virus has shuttered factories and container ports.
Quarantined workers and shortages of components have further crimped the availability of goods from China, which is the world's hub for manufacturing.
The intrigue: Of the companies surveyed that expect supply chain impacts (80% said yes), most expect the severity of the disruptions will increase after the first quarter of this year.
Why it matters: The virus' impact has not yet been quantified, but the survey from the Institute for Supply Management — the first of its kind — shows just how widespread its impacts have already been for American businesses.
“The story the data tells is that companies are faced with a lengthy recovery to normal operations in the wake of the virus outbreak,” ISM CEO Thomas W. Derry said in a statement.
“For a majority of U.S. businesses, lead times have doubled, and that shortage is compounded by the shortage of air and ocean freight options to move product to the United States -- even if they can get orders filled.”
Details: ISM's business contacts, of which 81% are firms with revenues of less than $10 billion, reported a laundry list of disruptions that have already resulted from the outbreak.
Manufacturers in China report operating at 50% capacity with 56% of normal staff.
More than 44% of respondents said they did not have a plan in place to address supply disruption from China.
Six in 10 (62%) respondents are experiencing delays in receiving orders from China.
More than half (53%) are having difficulty getting supply chain information from China.
Nearly one-half are experiencing delays moving goods within China (48%).
Almost one-half (46%) report delays loading goods at Chinese ports.
Of note: The survey was conducted between Feb. 22 and March 5 among 628 respondents that largely represent U.S. organizations.
and then what happens when we run out of drugs (medical ones, the other industry in drugs may go nuts of course..LOL) ?
best, the gnome
This Low rate of Exchange should be to the Companies benefit and Investors who are due to receive dividends shortly.
he said, “the results will not come in time to prevent a major recession shaping up—they will come much later.” The reason we haven’t seen this much needed infrastructure spending is due to concerns over how it would be funded.
Concerns over the federal deficit have vanished in the wake of Modern Monetary Theory (MMT). The U.S. has had skyrocketing federal deficits consistently over a trillion dollars, while interest rates have collapsed. This has led people to think deficits don’t matter and Shilling said, whether they matter in the long run or not is a different matter. He said the idea of MMT is taking away all concerns about deficit financing.
“The way I see it,” Shilling said, “We’ll have big fiscal stimulus in the form of infrastructure spending, with plans now and action not until later, but it will attempt to convince voters that the [government] is doing something.”
The End of Globalization?
Shilling said the coronavirus has put “the last nail in the coffin of the globalists, of the people who thought free trade was wonderful and the route to growth and global prosperity.” While the idea may have sounded nice, people have long been against it. He pointed to China not playing by the rules, to those who voted Trump into office and to those who voted for Brexit in the U.K.
“Globalization’s under attack,” Shilling said. This will lead to a less efficient world. A world without production in one country, manufacturing in another and labor in yet another. There will be slower economic growth and less productivity growth. Shilling doesn’t believe this model will lead to higher wages in the U.S. as many like to think. He said, “We won’t see a big benefit to U.S. wages because if you don’t have productivity growth, you don’t have the wherewithal to pay people more money.” He added that a slowing global economy is highly deflationary.
While the coronavirus isn’t a war in the typical sense, Shilling said it’s a threat to national security. It’s a national security issue if we can’t be assured that necessary supplies like raw materials, components, finished products will get to us. This could lead to more reliance on domestic industries such as steel and auto manufacturing. “There will be a lot more pressure to do things close by and I think it’s going to work to the benefit of Mexico, because Mexico is still a lot cheaper for manufacturing than the U.S,” Shilling said.
There aren’t currently any big imbalances in the U.S. economy like the subprime mortgages of the 2007-2009 recession. But, with all the disruption in the global supply chain, Shilling believes the U.S. could see a severe recession. “Simply because it’s such a novel situation. It’s such a disruption in the way the world has been put together.”
A disruption that is needed, as the logic of the previous financial engineering model was and is fatally flawed.
Finding it hard to beat the logic...I need some help?
best to all, wash
Gary Shilling on US Recession, Global Supply Chain Disruption and Oil Price War
WED, MAR 18, 2020 - 11:13AM
By FS Staff
As markets continue their volatile streak...Gary Shilling's take on what’s happening and what investors can expect in the weeks and months ahead.
.. two years ago, Shilling correctly predicted interest rates would dip to one percent and that oil prices would fall. He made this call while the Fed was raising rates and many didn’t see much validity in his forecast but, as the markets see some of their worst days, the call is more prescient than ever. Shilling discussed the oil supply war, economic impacts of the coronavirus and the reorganization of the global supply chain.
Shilling explained that supply currently exceeds demand for oil and the only way you can support prices is by limiting supply. Russia and Saudi Arabia have both promised to increase their oil production in this price war, thus sending oil prices down sharply. Shilling believes there’s a bit of a hidden agenda in this fight between the two countries.
“I think the ultimate aim here is they're both trying to drive American frackers to the wall because their oil is cheapest, as fracked oil is, their oil is cheaper on a marginal cost basis. Once you've got the holes in the ground, the cost you're getting out into the market is about five bucks a barrel in the Persian Gulf.”
But Shilling doesn’t see this lasting forever. He pointed to the entrepreneurial spirit of frackers and predicated that once oil prices bounce back to $40 or $50 a barrel, “they’ll be back in there drilling like crazy.”
Consumers No Longer Supporting US Economy
In the past four years, consumers have accounted for nearly 90 percent of the U.S.’ economic growth. In the wake of the coronavirus panic with bars, restaurants and most public events and spaces closing or canceling, this won’t hold true much longer. Most discretionary spending has halted, whether because restaurants and bars have closed, conferences canceled and travel stopped, or because many of the people working in such service-based industries no longer have jobs due to the forced closures.
This lack of consumer spending will continue much longer than the closures. Interestingly, Shilling pointed to the stockpiles many Americans have made with things like toilet paper and non-perishable items. “People are going to be working down those inventories after [the quarantine] is over, which is going to reduce their spending for many more months beyond the end of the coronavirus scare.”
Push for Infrastructure Spending
Just as in 2009, Shilling believes there will be a “big push” for infrastructure spending the U.S in the coming months. But....see part 2
Carzy no problem. If you were building a new house you would speak to a Surveyor or Architect -yes. If you were building a share account I would also in your position seek someone like Hargreaves Lansdown and ask them for a Tracker on the FTSE it does not have to be the 100 index you could introduce a little bit more risk and pull in the smaller Comps. Unfortunately no one Company is very good all of the time, most at some stage will catch you and or every one out. I even spoke to an ex- Prudential salesman I know and he has just done for himself the very same thing. Good luck whatever you decide.
Pundits on Bloomberg have said they think the loss of face by Saudi in opposition to Russia not playing ball is at least a 12 month if not longer to a climb down or in modern parlance an amicable compromise. In both their interests to take out American Shale which breaks even at about 45-50 dollars a barrel.
With the widening gap between physical delivery and Comex ETF how long can the Fed maintain the gap.
Fascinating time eh
As the sp seems to have been hardest hit today could this be down to that we havent had the recent update. I thought it was due a little while back?.
Many thanks Chan and Sotolo for your experienced advice. In that Centamin Board have consistently said and on historical support have said they intend to return profit share to share holders do you see a return (subject to the caveats raised by Sotolo) a divi for 2020/2021 of 11-13% My embarrassing maths indicate this would be at the bottom of the range . Do you see an addition to reserves in anticipation of Africa and further concessions obtained in the round of bidding by EMRA. I am not at all interested in short term share price although having been severely bruised by day trading over a few too many years I am impressed by the skill but above all courage of Tornado in playing the game . nerves of steel spring to mind.
Regards to all
Sort out the problems withe the share trades and current share price.
Tonight the SP is 10 p less than you are showing.
Its our money ,just cant put any more in my pension so using hers , she thinks its going in medium risk , but sticking it in high risk , think most of the risk has gone ! Im not clued up to do spreads or such as am an uneducated specialist construction company owner , and most shares ive dabbled in have not done very well , so have to trust our pension people to do there job as my wife wont let me buy any more shares personally ...doh ..if she would I would be piling in a few blue chips like shell and bp, and a few small ones like casp and ??M in law passed with a disease worse than covid 2 yr ago Dementia, bless her soul.
When the market recovers you get a well balanced spread of recovery? You just never know with Shares. I mean tomorrow someone might say wow that Centamin looks cheap I will buy them out? Or the Ruskies might say lets not flood the market with cheap oil -lets cap a few wells and then you might want to look at Plexus? If kids stay at home Dixons Computer games might be in demand ? Or BT or Vodafone bills might go up? Or kids might want a delivery of crisps? Pensions need to be safer best to try a spread but your call, but remember its her money and her choice? Actually good time to buy a holiday place on your private Island to isolate from the Mother-In-law virus? -Only joking she might be ok?
Hi all , ive been invested in Centamin from 160 down to 30 and back up again , but am asking the advice of the regular posters on here because in all the shares I own the chat on here is always good , ive got planned to invest 62k from my company in the morning into adventurous equities in my wifes pension as have a bit I can claw back from last years allowance too , do you all think this is crazy or a decent shout ,?
Cowichan that is quite right, I said lower aisc of around$100 or £80, the currency that counts for us. Then gold is within £30 of its all time sterling high so profits should be higher than ever UNLESS
A. Gold tumbles
B. Centamin is forced to close because of Coronavirus just as Hochschild main mine has been
The price of Cey is a third below where it should be because of the above imho
A quick calculation based on my limited math skills and I do mean limited. Fuel costs as a percentage of production costs were 19% last two years running. If we assume an AISC of 900.00 and roughly 1/5 of that is fuel (i.e. $180.00) then if fuel averages half of what is cost last year we should save 90.00 an ounce - so say 10% savings to the AISC. Of course all that could be rubbish as there must be more variables I am not considering. One last note, I can't see oil prices remaining at these levels very long as the Saudis would not be able to support their lavish standard of living. If I'm right it's not hard to imagine oil back up to 50.00 by July. Alternately if enough of the US shale producers go belly up we could see an oil shortage come fall. Stay well!
PS I welcome other calculations - as I am by no means educated on these matters!
They rested on the basis that NICE had not at that time authorised its use by the NHS. every OTHER HEALTH iNSURER WAS AUTHORISING PAYMENT FOR ITS USE. Our Haemotologist at the time albeit earning a good few quid in Harley St as you can imagine VOLUNTEERED to pay for Trastuzomab ( about 30 grand at that time from her own pocket.) The very best of human nature can crop up in the most amazing places. I have had the privilege to sit down on a pavement in London in a formal morning suit after a specific City meeting and had a chat with the poor individual on the lowest spoke of fortunes wheel.
From our comfy position in life which I acknowledge was probably obtained by very hard work it is a salutory experience.When this virus thing is over give it a try , it is a very humbling experience.
Off topic again so apologies to all.
I did at some previous time get the annual fuel oil requirement for CEY but was not capable of interpreting this into the AISC . going forward. with your particular expertise and experience your advice would be most appreciated.
With Brent at 24/25 dollars a barrel and likely to remain so for the coming financial year are you able to give your thoughts in this direction. I ask as a Long term holder and the effect this may have on future divi declarations .Sorry to be presumptuous and a reply saying work it out yourself expected and received with good grace.
Isolated but infection free Bob (so far)
Thank you Bob,
Glad to hear that your wife is still well though!
Yes Axa moto "Redefining healthcare" they certainly are!
Your post intrigued me to do some research on this I am also thinking of consulting the ombudsman although I will make sure to make more people aware of the small print in the Axa health insurance on this issue as they have been very sneaky and many policy holders may not be aware until it is too late!
I am not sure what the differences between every day ups/downs of market!
It seems to me that the C. Virus was gone yesterday, and was back again today!
If that say any thing so it say the manipulation of the market Mafia playing games and this C. Virus is best chance for them to collect all shares from banking small to medium private investors.
I hope that many in here understand that this circumstances is a temp. and all will be gone and back to normal in a few weeks or months. It may be the stock market affected by production and closing business will take some times to recover.
I am still holding and adding to my gold portfolio it is my chance.
Especially as the share price is now 94.44p (down -18.96%) on google finance !
The professor who has brought out the testing kit for the virus pandemic "Roche" "Rolfe" or whatever his name is said on TV. If everyone stayed in isolation in the World for two weeks at the same time the virus itself would die as it could not be passed on? He said it would be difficult to do but it would work. I also hear a serum has been found but it needs to go through experimental testing first but it is the taking to market and obtaining the relevant licences that takes the time. There is hope but at the moment no glory. At least I have not heard the Brexit B word for a few weeks but isolation from Europe may help us on this occasion?
Tumultuous world events have provided a once-in-a-lifetime opportunity to reward long term Centamin shareholders for their continued patience.
As a share buyback plan has been authorized by management for many years without implementation a press release to announce some immediate repurchases would be a welcome development.
Fellow LTH's feel free to forward to our Investor Relations Dept if you agree. Thx
Your post gave me deja-vue as my wife had the most horrific form of Breast Cancer in the early 2000's. She had private insurance from her occupational benefit and we went the private route in Harley St. This AXA paid for , all well and good so far. My research via the American Federal Drug Agency testing and reports (dont ask me how I got acess) and Herceptin was in Phase 3 final testing. Our haemotologist requested treatment as final treatment but AXA refused to pay. On investigation I found they were authorising its use and paying for patients in France . Long story cut short she was treated at home with herceptin (Trastuzomab) and is now in her 14th year of remission. I WOULDNT TOUCH ANY AXA PRODUCT WITH A BARGE POLE/ At the time Sun Alliance were authorising treatment with Herceptin and obviously it became primary treatment by the NHS. Sorry all for the off topic rant but thought Tibbs comments needed support.
Back to CEY as the divi is calculated in dollars the fall in the value of the pound against the dollar is of benefit to holders . Not sure when the crystallisation date of the exchange date for the divi occurs from memory but is it on the day of payment? Being lazy as could look it up.
Regards all from Isolated Bob ( hasten to add not infected at present)
"Mr.President, the only answer is to shut down the country for the next 30 days and close the borders," said activist investor Bill Ackman, founder and CEO of the $8bn Pershing Square Capital Management funds, on Twitter.
"Tell all Americans that you are putting us on an extended Spring Break at home with family. Keep only essential services open. The government pays wages until we reopen. No one defaults, no one forecloses."
Back in gold investing, holdings in the giant GLD gold-backed ETF were unchanged Tuesday, snapping 5 sessions of investor outflows.
The next largest US gold ETF shrank for the 3rd session running, however, with the iShares IAU product now shrinking 1.8% from last Thursday's fresh record peak.
No.1 physical platform BullionVault meantime saw client gold holdings rise to 40 tonnes, a new all-time record, with net demand so far this month hitting its highest since the depths of the global financial crisis in March 2009.
It is , the same with animal medication through a vets practice
I don't wish to dwell on personal matter but I was suffering pain and discomfort in both legs due to varicose veins, on one leg the veins were starting to break through the skin.
I consulted with my GP who was sympathetic and said that I was in danger of developing varicose ulcers and that I should carry some gauze pads at all times in case the veins broke through the skin.
My GP advised that I really needed surgery by a vascular surgeon on both leg but that the NHS commissioners had decided that varicose veins weren't life threatening and purely cosmetic, so the NHS would no longer fund any surgery costs and instead the funding saved would be diverted to NHS cancer & diabetes treatment.
I won't bore you all with lot's of details, but I will say that even though the operations were not pleasant dealing with AXA/Saga has been far worse in many ways!
So I am now recovering after 4 operations no thanks to the NHS, and although Saga/Axa refused to officially pay for the consultant's recommended procedures they have reluctantly made a goodwill payment to the BMI hospital which equates to the total bill for my treatment!
However whilst I was in the BMI hospital I remarked how busy it was and I learnt that this was due to the amount of NHS work being referred to the BMI private hospital because the local NHS hospital cannot cope with the demand .
The local NHS trust is paying the BMI private rates with a small negotiated discount!