Travis Esquivel is an engineer, passionate soccer player and full-time dad. He enjoys writing about innovation and technology from time to time.

The Energy Report: Biden Panic Buying
Mar28

The Energy Report: Biden Panic Buying

Image Source: What does it say that the Biden administration is starting to buy oil back for the Strategic Petroleum Reserve (SPR) above their stated $70.00 to $67.00 a barrel buying price, purchasing oil at $81.32 a barrel? Is it possible that the Biden administration is fearful that we’re going to get another spike in price? Or are they trying to fill it up in anticipation of something more ominous? Are they worried about the report from energy consultancy Wood Mackenzie that warns that more than one firth, or 21%, of global refining capacity is at risk of closure due in part because of what Saudi Aramco Chief Executive Amin Nasser said this week was a failed and flawed energy transition? Are they starting to worry that major reporting agencies like the International Energy Agency are starting to predict an oil deficit something The Energy Report of course has been warning about for over a year? Perhaps they are starting to worry about more predictions like that of Morgan Stanley about calls for a return to $100.00 a barrel of oil. Are they worried that heading into an election year, we’re seeing gasoline prices start to rise and the defense of their green energy policy is not going to play well on Main Street America?Perhaps they are concerned that their political motivated use of our strategic reserves has left the country more vulnerable as the Biden foreign policy has failed to reduce risk to global energy supply and global supply chains. Biden’s presidency has […]

Read More
Pending Home Sales Hover Near Record Lows In February
Mar28

Pending Home Sales Hover Near Record Lows In February

After puking in January, pending home sales were expected to rebound modestly (+1.5% MoM) in February and it did (+1.6% MoM) with a small upward revision for Jan (from -4.9% to -4.7% MoM). However, this still left sales down 2.2% YoY…Source: BloombergThat leaves pending home sales hovering just off record lows…Source: BloombergA recent report showed listings may be starting to rise, with inventory reaching its highest level for a February since 2020. “While modest sales growth might not stir excitement, it shows slow and steady progress from the lows of late last year,” NAR Chief Economist Lawrence Yun said in a statement on Thursday. The Midwest was the main driver of the increase in pending sales, with a 10.6% jump. Contract signings in the South, the nation’s biggest housing market, edged up 1.1%. They were little changed in the Northeast and dropped in the West. “The high-cost regions in the Northeast and West experienced pullbacks due to affordability challenges,” Yun said. The pending-home sales report is a leading indicator of existing-home sales given houses typically go under contract a month or two before they’re sold.Stocks Set To Close Blowout Week, Month And Quarter At All-Time High; Gold Soars To RecordZero Critical Reasoning: Employers Say GenZ Toxic For CompaniesCBO Director Warns Of Debt Market Meltdown With US Debt Is On “Unprecedented” Trajectory

Read More
Copper’s Red-Hot Rally, Fueled By EVs, Renewables And A Smelter Squeeze
Mar28

Copper’s Red-Hot Rally, Fueled By EVs, Renewables And A Smelter Squeeze

Copper futures climbed as high as $9,164.50 per metric ton on the London Metal Exchange (LME) on Monday, March 18, marking a fresh 11-month high. The rally comes hot on the heels of a months-long sideways grind, propelled by supply risks and growing optimism around the global economic outlook.Contributing to the run-up is news that as many as 15 Chinese smelters are considering output cuts at a recent high-level meeting in Beijing, which ignited a flurry of trading activity that the LME hasn’t seen in years. What’s more, an average of 11.5% of monitored copper smelter capacity in China was inactive in the first two months of 2024, compared to 8.6% in the same period last year and 8% in 2022, according to U.K.-based geospatial data firm Earth-i.Why are smelters close to cutting supply? Simply put, Chinese operators are facing a crisis over treatment and refining charges, or TC/RCs—fees that are paid to process copper concentrate into refined metal. TC/RCs have collapsed due to a shortage of concentrate supply, squeezing already razor-thin profit margins. Copper’s Central Role In EVs And Renewable EnergyBeyond supply concerns, copper demand continues to be driven largely by the renewable energy boom. According to the International Energy Agency (IEA), copper’s share of total demand across all applications is forecast to surge from 23% currently to over 42% by 2050.This isn’t just hot air. In August 2023, the Department of Energy (DoE) added copper to its official list of critical materials, making domestic producers eligible for government subsidies […]

Read More
BoJ’s Tone: A Slow, Optimistic Influence On USD/JPY
Mar28

BoJ’s Tone: A Slow, Optimistic Influence On USD/JPY

Image Source:    The Bank of Japan’s dovish signals counter Japanese government intervention threats, keeping USD/JPY above 151. Recent BoJ statements highlight a cautious but optimistic economic outlook, potentially influencing USD/JPY dynamics. Market watchers see BoJ’s actions and global economic indicators as the yen battles intervention speculation and policy uncertainty. In the swirling currents of global finance, the Japanese yen finds itself at a pivotal juncture, steered by the dual helms of the Bank of Japan (BoJ) and the Japanese government. Recent developments have thrust the spotlight squarely on Japan as investors and analysts alike parse through mixed signals emanating from the country’s monetary authorities. The , a bellwether of economic sentiment and policy expectations, has steadfastly held its ground above the 151 handle, defying the Japanese government’s intervention threats. This resilience underscores a complex interplay of economic policies, market dynamics, and global influences, setting the stage for a nuanced analysis of what lies ahead for Japan’s economy and its currency.  The BoJ’s Calculated DovishnessAmid the cacophony of market movements and policy statements, the Bank of Japan’s recent communications stand out for their measured tone and cautious optimism. BoJ Board Member Naoki Tamura’s remarks on a slow and steady approach to raising interest rates, devoid of a concrete timeline, underscored a dovish stance that seemed to diverge from the government’s more interventionist signals. Similarly, BoJ Governor Kazuo Ueda’s preference for an accommodative monetary policy to support the economy further dampened expectations of aggressive action. These statements, while reinforcing the central bank’s […]

Read More
Initial Claims Remain Somnolent, While Continuing Claims Pop Slightly
Mar28

Initial Claims Remain Somnolent, While Continuing Claims Pop Slightly

The divergence in the trends between initial and continuing claims continued this week, as the former continued their somnolent good news, while the latter had a slightly disconcerting pop.Initial claims declined -2,000 to 210,000, and the four-week average declined from -750 to 211,000. On the other hand, with the usual one-week delay, continuing claims rose 24,000 to 1.819 million:The first two are in the same range they have been in for the past 4 to 6 months while continuing claims are at their highest number but for 2 weeks in the past two years.On the more important YoY basis for forecasting purposes, initial claims are down -9.5%, and the four-week average is down -7.0%, the best YoY comparison in the past 12 months. Continuing claims are up 7.2%, but this is the second lowest YoY comparison in the past 12 months:.Now let’s update the forecast of the Sahm rule. With last month’s 2 year high in the unemployment rate, I’ve been wondering whether, because unemployment includes both new and existing job losses, it followed continuing claims more than initial claims (although initial claims lead both). The historical graphs, which I posted two weeks ago so I won’t repeat now, indicated that continuing claims also lead to the unemployment rate, although with much less of a lead time.With that in mind, here is this week’s update of the post-pandemic record for the past two years on a monthly YoY% basis (unemployment rate YoY shown in red):Since on a monthly basis so […]

Read More