World's Largest Ag Trader To Cut Thousands Of Jobs

The big traders don't lay-off workers at the top of the markets they specialize in so this action probably means it is time to start watching for signs of a bottom in agricultural commodities.

From Bloomberg, December 2:

Cargill to Cut Thousands of Jobs Globally as Profits Shrink

• Largest private US firm will slash about 5% of workforce
• Most cuts will be made this year, CEO says in internal memo 

Cargill Inc. is cutting thousands of jobs globally after the largest privately held company in the US missed profit targets.

The Minneapolis-based firm, the world’s largest agricultural commodities trader, will cut about 5% of its 164,000-strong workforce as part of its 2030 strategy, according to an internal memo seen by Bloomberg. The reductions won’t affect its executive team, but will impact a number of next level senior leaders, according to people familiar with the matter, who asked not to be identified discussing internal matters.

Cargill and crop-trading rivals such as Bunge Global SA and Archer-Daniels-Midland Co. have seen earnings shrink after bumper crops sent corn and soybean prices tumbling. For Cargill, the squeeze has been compounded by the smallest US cattle herd in seven decades. The company has spent much of the past decade turning itself into the third-largest US beef processor.

“The majority of these reductions will take place this year,” Chief Executive Officer Brian Sikes said in the memo. “They’ll focus on streamlining our organizational structure by removing layers, expanding the scope and responsibilities of our managers, and reducing duplication of work.”

Read more: Cargill Supply Chain Head and Treasurer to Retire Amid Shakeup

Cargill had already told employees earlier this year that it would reduce the number of business units to three from five after less than one-third of its businesses reached their earnings goals in fiscal 2024. It also cut about 200 tech jobs in various locations.

The company’s profits fell to $2.48 billion in the year through the end of May, the lowest since 2015-16, Bloomberg Opinion’s Javier Blas reported. That’s less than half the record net profit of about $6.7 billion it made in the 2021-22 fiscal year....

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Previously:

• Farm Country: "Cargill’s annual revenue falls for the first time in years"
• Javier Blas: "Bumper harvests in wheat, corn and soybeans mean food prices are falling"

"Billionaire Tesla Whale Is Reducing Bet That Made Him Rich" (TSLA)

Following up on November 2021's Tesla, A Love Story: "Tesla's hidden billionaire in Singapore" (TSLA) which mentioned his purchase of James Dyson's Singapore pad.*

From Bloomberg, December 3:

• ‘No longer all-in on Tesla,’ Leo KoGuan posted on X Saturday
• Tesla shares are bulk of retail holder’s $13.5 billion fortune 

Leo KoGuan, one of Tesla Inc.’s largest individual shareholders, said he’s paring his stake in the automaker and putting some proceeds into government debt, fearing a selloff ahead.

“No longer all-in on Tesla,” the billionaire posted Saturday on X in response to a question whether he still holds the stock. “I am selling Tesla and accumulating 3-month Treasury Bills.”

[climateer here: bit of a change in the 'ol risk profile eh wut?] 

His reason for selling: to hedge his portfolio. “1929-type stock market crash is looming,” he wrote, making unspecified references to trillions of dollars worth of government debt and fiscal deficits.

KoGuan didn’t respond to requests for comment about the size and pace of his selling. But if true, it’s a big change for the man who emerged as a Tesla whale during the 2021 everything-rally and told Bloomberg News in interviews about his belief in Elon Musk and ambition to keep adding to his stake in the carmaker until he was worth at least $100 billion.

Tesla shares make up the bulk of KoGuan’s $13.5 billion fortune, according to the Bloomberg Billionaires Index. He held 27.7 million shares as of May, roughly 0.9% of the company, according to records reviewed by Bloomberg News.

Born in Indonesia, educated in New York and currently residing in Singapore, KoGuan made his initial fortune from SHI International Corp., a Somerset, New Jersey-based enterprise software company he ran with his ex-wife.

The 69-year-old has said he began buying Tesla in 2019 and quickly built a massive stake using stock options, doubling down again and again....

....MORE
*We happened to catch Dyson's sale of the penthouse when Mr. D. re-re-domiciled to back to the U.K.:

Dyson Sells Singapore Penthouse For $46 Million (USD)

Well, not really happened to; it is one of the choicest shacks in one of the choicest locations in the world.

From the introduction to October 2018's "Dyson chooses Singapore for first electric car plant":

I like Singapore although it is a bit authoritarian.
The people are bright, usually the highest average I.Q. in the world, sometimes #2 to Hong Kong.
In the case of Singapore the I.Q. thing is especially interesting as their average is higher than that of any of the genetic pools the city-state draws from: the Chinese, Malay and Indian.

As a Malaysian Chinese businessman I know has told me, "We should never have let Singapore get away."

Another back-and-forth with Hong Kong is income/wealth. HK has more billionaires but Singapore has a higher average income.
And then there are the Gurkhas. More after the jump....

"Trump Tariffs Threaten To Torpedo The Yuan"

From Asia Times via MENAFN, November 11:

Since Donald Trump's November 5 election win, the Chinese yuan has traded below the central bank's fixing rate. That suggests markets are bracing for a weaker yuan as the former and future US president prepares to ignite massive new trade wars.

A reasonable assumption? Not if People's bank of China Governor Gongsheng has anything to say about it. There are many reasons why Pan – and, for now, President Xi Jinping – want a stable exchange rate versus the dollar.

The dominant one is confidence. A big yuan decline might signal to global investors that there's an unseen major problem in Asia's biggest economy on top of a crippling property crisis, deepening deflation and massive capital flight.

The wildcard, though, is how Trump's coming trade wars might have Team Xi scrambling to make currency devaluation great again.

“Donald Trump's victory ... is ushering in a new phase of stress on the Chinese currency,” says Wei He, an analyst at Gavekal Research.

“The major question is what will happen if Trump starts to make good on his threats of new tariffs after taking office in January. In this scenario, it is highly unlikely that the renminbi will remain at its current level,” He said....

....MUCH MORE

Here's the exchange rate over the last month, via TradingView:

Up is weaker i.e. it takes more yuan to buy a dollar. 7.2806 last.

Coming to Market: "Bernie Ecclestone puts £500m car collection up for sale a year after record £652m tax bill"

There is a lot of red in these pictures.

Selection of 69 vehicles, including Ferraris and Brabhams, has been described as ‘the most important race car collection in the world’  

Bernie Ecclestone is putting his entire collection of historic grand prix and Formula One cars – 69 cars worth an estimated £500,000,000 – up for sale.

The 69-car collection includes Ferraris raced by world champions such as Mike Hawthorn, Niki Lauda, and Michael Schumacher, Brabhams raced by Nelson Piquet, Carlos Pace, and Lauda, as well as the one-off Brabham-Alfa Romeo BT46B ‘fan car’, which raced only once, winning the Swedish Grand Prix at Anderstorp in 1978.

It comes after Ecclestone, 94, pleaded guilty last year to fraud after being accused of failing to declare more than £400 million of overseas assets to the UK Government. Prosecutors told the court that Ecclestone would pay a record £652 million to HM Revenue and Customs, and he was given a suspended jail sentence of 17 months. It made him the UK’s second-highest taxpayer, according to the Sunday Times tax list for 2024.

But the former F1 supremo has insisted the car sale is because the time has come for him to “start thinking about what would happen to them should I no longer be here”.

“That is why I have decided to sell them [the cars],” he said. “I would like to know where they have gone and not leave them for my wife to deal with should I not be around.”....

....MUCH MORE

 

 

Satellite-Inferred Global Temperature Continued Downtrend in November

Following on last month's "Satellite-Inferred Global Temperature Down In October—With A Caveat" where the drift of NASA's satellites forced a truncation of the dataset.

From Dr. Roy Spencer at the University of Alabama-Huntsville, (UAH) December 3:

UAH v6.1 Global Temperature Update for November, 2024: +0.64 deg. C

Metop-C Satellite Added to Our Processing

With this update, we have added Metop-C to our processing, so along with Metop-B we are back to having two satellites in the processing stream. The Metop-C data record begins in July of 2019. Like Metop-B, Metop-C was designed to use fuel to maintain its orbital altitude and inclination, so (until fuel reserves are depleted) there is no diurnal drift adjustment needed. Metop-B is beginning to show some drift in the last year or so, but it’s too little at this point to worry about any diurnal drift correction.

The Version 6.1 global average lower tropospheric temperature (LT) anomaly for November, 2024 was +0.64 deg. C departure from the 1991-2020 mean, down from the October, 2024 anomaly of +0.75 deg. C.

The Version 6.1 global area-averaged temperature trend (January 1979 through November 2024) remains at +0.15 deg/ C/decade (+0.21 C/decade over land, +0.13 C/decade over oceans).

The following table lists various regional Version 6.1 LT departures from the 30-year (1991-2020) average for the last 23 months (record highs are in red). Note the tropics have cooled by 0.72 deg. C in the last 8 months, consistent with the onset of La Nina conditions....

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We will have to factor-in the dataset discontinuity when we do the final tally on our prop bet.

If interested see the bet saga:

From May 5's "UAH Global Temperature Update: April Sees New High Temperature Anomaly For The Satellite Era":

Great, just effin' great. I had to go shooting my mouth off with a prop bet on May 2, couldn't wait for the new number to be released, no sirree, had to be posted when the memory to post it was triggered:

Here's a prop bet for you. By May 15, 2026 we will see the satellite-measured -inferred global lower atmospheric temperature anomaly decline by at least 1/2 degree C.

The two keepers of the satellite record are Remote Sensing Systems in Santa Rosa CA and the University of Alabama-Huntsville.

Here's the temperature graph from UAH:....

****

and repeated: "Again the baseline for the prop bet: the above 'Latest Global Temp. Anomaly (March '24: +0.95°C)'" 

Well here's Roy Spencer, PhD from the University of Alabama-Huntsville at his personal site, later on that same day that shall live in infamy, May 2, 2024:

UAH Global Temperature Update for April, 2024: +1.05 deg. C....

June 5
UAH Global Temperature Update: May Sees Temperature Anomaly Come Down A Bit

The University of Alabama-Huntsville is one of the two keepers of the satellite temperature record (along with Remote Sensing Systems). Here's UAH's Dr. Roy Spencer with the update and our adventures in prop bets after the jump.

July 3
Latest Global Average Tropospheric Temperature Anomaly Comes Down A Little Bit More (plus the prop bet, month 3)

Former British Defence Head: World War III Won't Begin Over Ukraine, Svalbard Will Be The Fuse (maybe)

 First up from the Financial Times, November 24:

Big Read
Can Europe defend itself without America?
The continent will have to spend more as Trump refocuses policy elsewhere. But replacing US military heft will not be easy

John Paul Rathbone, Henry Foy and Ben Hall

Imagine it is 2030. Russia and China are holding their first major military exercises in the Arctic. Called Vostok 2030, the joint drill involves thousands of troops, tanks, aircraft, and most of the Russian and Chinese northern fleets. It is just the latest manifestation of Moscow and Beijing’s “historic partnership”.

Over the past five years, Russia and China have steadily increased their military and economic presence in the Arctic. The 2025 “ceasefire” in the Russo-Ukraine war allowed Moscow to reconstitute its military. Beijing has also come to view Nato as a paper tiger after US President Donald Trump accelerated the shift in Washington’s focus away from Europe and towards China.

Suddenly, Russia announces it has extended its control over the Arctic continental shelf. China says it recognises the claim. Russia, in turn, declares that China’s “historic claim” to the South China Sea is legitimate too. Soon after, Sino-Russian forces invade Norway’s Svalbard archipelago, a strategic group of islands that controls access to the high north. Nato forces mobilise — but lack the US military’s heft and logistical power to take it back.

Europe’s Nato allies now face a terrible strategic dilemma: cede control of Svalbard or invoke the full force of their mutual defence treaty and launch a retaliatory nuclear strike. In London and Paris, the British prime minister and French president, who control Europe’s two separate nuclear arsenals, face an appalling decision.

This doomsday vision is not a prophecy. But nor is it wholly implausible either. Drawn from The Retreat From Strategy, a new book by General Lord David Richards, former head of Britain’s armed forces, and Julian Lindley-French, a professor at the Netherlands Defence Academy, the scenario lays bare the security threats facing Europe, and how they could unfold if unaddressed.

For all the losses it has so far suffered in Ukraine — as many as 700,000 killed or wounded, according to UK military intelligence — General Christopher Cavoli, Nato’s supreme commander, warned last month that the Russian military would emerge from the war “stronger than it is today”....

....MUCH MORE

 

And from The Critic, October 5:

Folly, fantasy and Britain’s defence crisis
Britain has spent scarce resources in support of the fantasy of “Global Britain”  

When asked what he wanted, the veteran American trade union leader Samuel Gompers replied, “More.” The authors of this timely book on Britain’s defence strategy, or lack of one, also want “more … more of everything”. They want more money, for more men, more tanks, more aircraft and more ships. Above all, they want more understanding of what Britain’s strategic aims are and how they can be realised.

Both authors are well qualified to write this book. David Richards is a former Chief of the Defence Staff with a long and distinguished military record. He is well known for his intellectual curiosity; I served (full disclosure) on the strategic advisory panel he set up in 2010. Julian Lindley-French is a well respected professor of defence strategy at the Netherlands Defence Academy.

The book is explicitly written for “the new government” and appears shortly after Labour’s resounding election victory in July. It draws on the authors’ experiences as well as a range of materials, including questionnaires filled in by service personnel and senior politicians such as former prime minister Tony Blair.

Richards and Lindley-French bookend their argument with two scenarios, the first of which sees unprepared UK and allied forces vanquished by a Sino-Russian coalition in the “High North” near the Norwegian archipelago of Svalbard, in seven years’ time. The second offers an alternative in which a well-resourced British-led NATO task force sees off these two enemies. Unless we change course fast, the authors argue, the former outcome is much more likely than the latter.

The “retreat from strategy” bemoaned by the book is driven by both financial and conceptual factors. UK defence expenditure has steadily fallen in relative terms since the end of the Cold War as the nation cashed in on the “peace dividend”. Aggravating the situation is the fact that the hugely expensive nuclear deterrent, once budgeted for separately, is now paid for out of the general defence pot. In consequence, the army is now the smallest it has been since the end of the Napoleonic Wars, whilst the navy has shrunk beyond recognition, as has the RAF.

To make matters worse, the authors argue, government no longer thinks strategically, and it hasn’t for some time. In their view, the rot set in at the end of the 1990s with the “overreach” of Blair’s demand that Britain should act as a “force for good” in the world. This led to a conflation of “interests and values”, and ultimately — via the interventions in Kosovo, Afghanistan and Iraq — to the disastrous scramble from Kabul airport in August 2021....

....MUCH MORE

Saxo Bank Outrageous Predictions 2025

 From Saxo:

Our Outrageous Predictions are not exactly news and not exactly real – at least not yet. And while we don’t know which stories will drive the global economy in the coming year, our 2025 predictions, from Nvidia trouncing its Mag 7 peers to the fall of OPEC, from a bold bet on reflation in China to a great leap forward in biotech, are just as promised. Outrageous....

Trump 2.0 blows up the US dollar
As the new Trump administration turns the global financial system on its head with huge tariffs, the world scrambles to find alternatives to the dollar.

Nvidia balloons to twice the value of Apple
Armed with its revolutionary AI chips, could tech giant Nvidia grow to twice Apple's size and become the most profitable company of all time? 

China unleashes CNY 50 trillion stimulus to reflate its economy
Having created history’s most epic debt bubble, China boldly bets that fiscal stimulus to the tune of trillions of CNY is the only answer.

First bio-printed human heart ushers in new era of longevity
It’s alive! Fusing bioengineering and medical science, scientists successfully bio-print a human heart, promising to extend the lives of millions. 

....MUCH MORE

"China bans export of key minerals to U.S. as trade frictions escalate"

From Reuters via Investing.com, December 3:

China has banned exports to the U.S. of items related to the minerals gallium, germanium and antimony that have potential military applications, its commerce ministry said on Tuesday, a day after Washington's latest crackdown on China's chip sector.

Beijing's directive on so-called dual-use items with both military and civilian use, which cites national security concerns and takes immediate effect, also requires stricter review of end-usage for graphite items shipped to the U.S.

"In principle, the export of gallium, germanium, antimony, and superhard materials to the United States shall not be permitted," the ministry said.

The curbs strengthen enforcement of existing limits on exports of the critical minerals that Beijing began rolling out last year, but apply only to the U.S., in the latest escalation of trade tensions between the world's two largest economies ahead of President-elect Donald Trump taking office.

However, there have been no Chinese shipments of wrought and unwrought germanium or gallium to the U.S. this year through October, although it was the fourth and fifth-largest market for the minerals, respectively, a year earlier, Chinese customs data show.

Gallium and germanium are used in semiconductors, while germanium is also used in infrared technology, fibre optic cables and solar cells.

Similarly, China's overall October shipments of antimony products plunged by 97% from September after Beijing's move to limit its exports took effect....

....MUCH MORE

This has been coming for a while, if interested see 2023's "China chokes exports of semiconductor secret sauces gallium and germanium" and August 2024's "China to restrict exports of strategic metal antimony".

Capital Markets: "US-China Exchange Export Restrictions, Yuan is Sold to New Lows for the Year, while the Greenback Extends Waller's Inspired Losses "

From Marc Chandler at Bannockburn Global Forex:

Overview: The US dollar has extended the losses scored late yesterday when Federal Reserve Governor Waller indicated he was still leaning toward a December rate cut. The odds of a rate cut rose to around 76% from about 66% at the end of last week. The odds are slightly lower today, around 72%. A solid jobs report on Friday and another uptick in CPI may change some minds. The only G10 currency that is weaker today is the Japanese yen, and it is off about 0.25%. Emerging market currencies are mixed. Asia Pacific currencies are mostly lower, and the central European currencies are mostly higher. Of note, tit-for-tat exports controls between the US chips and fabrication equipment and Beijing's export ban to the US of some critical minerals and metals. The yuan was sold to a new low for the year today.

 Asia Pacific and European equities are advancing today. Japan, Hong Kong, South Korea, and Taiwanese indices gained more than 1%. The Stoxx 600 in Europe is up for the fourth consecutive session, matching its longest advance since May. US index futures are little changed. European bonds yields are firmer, but the French premium over Germany is a few basis points narrower today, despite the tension, and France's CAC 40 is outperforming Germany as well today. The 10-year US Treasury yield is up almost three basis points to 4.22%. The two-year yield is flat near 4.18%. Gold is firm and is trading in the upper end of yesterday's range. It is holding below $2650. January WTI appears to be forging a base near $68. It has not settled above $70 since November 22.... 

....Europe
There are two main drags on the euro: politics and economics....

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Other than that...

What Is This BRICS Pay Messaging System You Speak Of?

From Yahoo Finance, December 2:

How an upstart global payment system led to Trump's latest tariff threat

Donald Trump's latest tariff threat appears to have stemmed at least in part from a nascent blockchain-based entrant into the influential world of global financial messaging.

The president-elect's move came in a Saturday afternoon post where he promised 100% tariffs on countries looking to move away from the dollar.

"[A]ny Country that tries should wave goodbye to America," he wrote.

The target was an organization called BRICS, which currently boasts 10 nations and is led by the Western adversaries of China and Russia.

One new product offering appears to be a key stumbling block.

"The proximate cause of Trump's threat is the development of BRICS Pay," wrote Douglas Holtz-Eakin, the president of the American Action Forum, in a Monday morning note.

BRICS Pay is a new attempt by the group to use digital payment and QR code technology to provide an alternative to dollar-dominated networks — specifically the Society for Worldwide Interbank Financial Telecommunication (SWIFT)....

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Dear Georgia: ChatGPT could help a country get into the EU (so can Goldman Sachs)

With all the trouble Tbilisi [my spell-checker keeps prompting Tbills] is being put through we might have a way to ease the pain. Depending on how you read this Economist headline (2Dec24):

Huge anti-Russian protests in Tbilisi echo Ukraine’s Maidan

it appears they are saying there is a color revolution going on, for that is what the Maidan was. But the EU has a few other tricks up their collective sleeves.

First up, Semafor, December 14, 2023:

Albania plans to use ChatGPT to speed up its application to join the European Union by translating thousands of pages of legal documents.

Prime Minister Edi Rama reportedly said this week that the country will partner with OpenAI, the company behind the chatbot, to translate complex EU legal measures into Albanian, detail what changes need to be made to existing local laws, and then analyze the impact of those adjustments. Albania has been trying to join the EU for 14 years.

It’s the latest example of AI’s increasing presence in government globally, as calls grow for more oversight of the technology.

It’s smart for Rama to stay on top of new developments in AI, but using ChatGPT in this way could backfire, the head of an AI-and-governance research program argued. ChatGPT is known to occasionally produce false information, and is more likely to actually prolong the ascension process, “as government officials may blindly follow the wrong instructions and information,” Medlir Mema wrote in A2, Albania’s CNN affiliate. He also raised concerns about data privacy, and questioned whether Albania is taking a flashy route without focusing on the content of the reforms needed to join the bloc....

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And from Der Spiegel, February 8, 2010:

How Goldman Sachs Helped Greece to Mask its True Debt
Goldman Sachs helped the Greek government to mask the true extent of its deficit with the help of a derivatives deal that legally circumvented the EU Maastricht deficit rules. At some point the so-called cross currency swaps will mature, and swell the country's already bloated deficit.   

Greeks aren't very welcome in the Rue Alphones Weicker in Luxembourg. It's home to Eurostat, the European Union's statistical office. The number crunchers there are deeply annoyed with Athens. Investigative reports state that important data "cannot be confirmed" or has been requested but "not received."

Creative accounting took priority when it came to totting up government debt. Since 1999, the Maastricht rules threaten to slap hefty fines on euro member countries that exceed the budget deficit limit of three percent of gross domestic product. Total government debt mustn't exceed 60 percent.

The Greeks have never managed to stick to the 60 percent debt limit, and they only adhered to the three percent deficit ceiling with the help of blatant balance sheet cosmetics. One time, gigantic military expenditures were left out, and another time billions in hospital debt. After recalculating the figures, the experts at Eurostat consistently came up with the same results: In truth, the deficit each year has been far greater than the three percent limit. In 2009, it exploded to over 12 percent.

Now, though, it looks like the Greek figure jugglers have been even more brazen than was previously thought. "Around 2002 in particular, various investment banks offered complex financial products with which governments could push part of their liabilities into the future," one insider recalled, adding that Mediterranean countries had snapped up such products.

Greece's debt managers agreed a huge deal with the savvy bankers of US investment bank Goldman Sachs at the start of 2002. The deal involved so-called cross-currency swaps in which government debt issued in dollars and yen was swapped for euro debt for a certain period -- to be exchanged back into the original currencies at a later date.

Fictional Exchange Rates

Such transactions are part of normal government refinancing. Europe's governments obtain funds from investors around the world by issuing bonds in yen, dollar or Swiss francs. But they need euros to pay their daily bills. Years later the bonds are repaid in the original foreign denominations.

But in the Greek case the US bankers devised a special kind of swap with fictional exchange rates. That enabled Greece to receive a far higher sum than the actual euro market value of 10 billion dollars or yen. In that way Goldman Sachs secretly arranged additional credit of up to $1 billion for the Greeks.

This credit disguised as a swap didn't show up in the Greek debt statistics. Eurostat's reporting rules don't comprehensively record transactions involving financial derivatives. "The Maastricht rules can be circumvented quite legally through swaps," says a German derivatives dealer....

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"Chinese researchers indicate diamonds can store data for millions of years"

And all of a sudden Alrosa is back in the big time. 

From ReadWrite, November 29:

Research has suggested that diamond-based storage technology could preserve vast amounts of information for up to millions of years. 

The work carried out by a team at the University of Science and Technology of China achieved a new record for storage density in diamonds, at 1.85 terabytes per cubic centimeter.

As impressive as the storage capacity is, the researchers believe this can be eclipsed by the staying power. It has been claimed the diamond system can hold data for millions of years, due to the technique used to encode information within the atomic structure of the diamond.

As published in Nature Photonics, the scientific breakthrough extends beyond the significant density capacity with marked improvement in read times. The team indicated high-speed readout showed a fidelity of over 99%. 

“Here we present a diamond storage medium that exploits fluorescent vacancy centers as robust storage units and provides a high storage density of 14.8 Tbit cm−3, a short write time of 200 fs, and an estimated ultralong maintenance-free lifespan on the scale of millions of years,” said the authors in the paper.

To put the advances into context, advanced hard disk drives can reach around one terabyte per cubic centimeter, while a diamond optical disk can store data at a rate of density 2,000 greater than an ordinary Blu-ray disk. 

So much for Meta’s Quest mixed reality headset being futuristic, this project takes research into a new realm....

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"Beijing and Moscow tune in for more Arctic shipping"

Driving Russia and China closer together was idiotic and potentially catastrophic for the West. The admirals and generals and so called statesmen (actually just politicians cosplaying in fancy dress) who did this should pay a very heavy price.

From The Barents Observer, December 2: 

Only few days after a Chinese bulk carrier destroyed two cables in the Baltic Sea in what appears as an act of sabotage, top officials from Beijing and Moscow sat down for their first meeting in a joint cooperation body for the Northern Sea Route.

"Although this is our first meeting in the Subcommission, we have already reached a series of agreements on safe shipping between our countries," Head of Rosatom Aleksei Likhachev said in an opening remark in the recent meeting. 

"Constructive interaction is being established also in other important fields of interest [and] I believe that we have laid a solid basis for the work of the subcommission," the leader of Russia's state nuclear power company added.

China's Minister of Transport Liu Wei expressed consent. "The sides have reached consensus on several important issues with regard to the upcoming joint work," he said, according to the press service of Rosatom.

The meeting the joint structure was held only few days after the incidents with the Yi Peng 3. The 250 meter long Chinese bulk carrier is believed to have damaged to underwater communications cables in the Baltic Sea. The police in the affected countries suspect sabotage.

In early October 2023, the Chinese-Russian ship Newnew Polar Bear was involved in a similar case. By dragging its anchor over the Balticconnector gas pipeline, as well as a communication cable, the underwater infrastructure was seriously damaged. The ship escaped into north Russian waters and later sailed the Northern Sea Route back to China....

....MUCH MORE

Probably related, also at The Barents Observer, this time November 27:

Suspicious sailing by Russian ships near Norwegian gas hub

While a Russian reefer previously suspected of espionage requested emergency assistance off the coast of the Nyhamna gas processing and exporting facility, a Chinese special cargo vessel criss-crossed the same waters.

If the Baltic cable game plays out the way things work in the South China Sea the progression is: deny, then plead innocence, then ask "Whatcha gonna do about it?" 

It is at that point that we will be re-referencing the words Chairman Mao said about the U.S.:

"In appearance it is very powerful but in reality it is nothing to be afraid of; it is a paper tiger. Outwardly a tiger, it is made of paper, unable to withstand the wind and the rain. I believe that it is nothing but a paper tiger..."

Or as the philosopher asked the generals and armaments producers some time ago: 

"When was the last time you b****es won a war?

Norges Bank On The Future Role Of The Trader In The Age Of AI

From The Trade, November 28:

The future role of the trader as product owner
The TRADE sits down with Alan Martin Lucero, lead FX trader at Norges Bank Investment Management, to explore the future role of traders on the desk and how they’re expanding their market knowledge to become a jack of all trades across the trading lifecycle.

What do you believe the trader of the future looks like skills wise?

We need to take a step back and look at today’s trading desk. By dissecting a trading desk into its functions, processes, and tasks, it becomes clear that 80% or more can be successfully automated with today’s technology – and that figure is just for the front-office, potentially even higher in the middle- and back-office. We first need to envision how the job will evolve in the coming years. I envision the trader’s role converging into a multifaceted position where responsibilities traditionally spanning from the front- to the back-office will be seamlessly integrated and executed with the aid of technology.

These technological advancements will profoundly impact our industry and give rise to a new kind of role: the “domain jack of all trades.” In other words, traders will likely become more akin to product owners. Being a market expert and knowing all the ins and outs of trading will no longer be sufficient. Instead, we will need to be familiar with all aspects of the business, from legal and settlement processes to transaction cost analysis and trading. This implies that fewer people will be needed to run a trading desk end-to-end, with more operations running as a one-man show, relying on the interaction of a human and a multitude of specialist systems or AIs. 

So, what are the skills of a domain jack of all trades? 

By definition, many, but the key ones I believe will be relevant are: 

Project Management Skills: The ability to manage multiple tasks, prioritise efficiently, and oversee the implementation and maintenance of automated trading workflows.

Adaptability and Curiosity: Flexibility to adapt to new market and regulatory conditions. A continuous drive to learn about every single corner of the business and market. This adaptability will be essential in an environment where change is constant and rapid.

Technical Skills: While traders may not need to program large-scale applications, the ability to retrieve and analyse data will remain vital. Skills in basic programming or systems knowledge will be necessary for tasks such as manual overrides, improvements, and customisations. Understanding technology will be crucial for validating automated workflows.

Soft Skills: Strong communication skills to convey complex information to diverse stakeholders. Problem-solving and creativity to navigate and innovate within complex systems. A holistic business understanding to see the broader picture and integrate various aspects of the business effectively. This is, and will likely continue to be, a people business, requiring strong interpersonal skills to manage relationships and collaborate effectively.

The interesting aspect of this vision is that no single degree can prepare you for this. It is unrealistic to expect a trader to be formally trained in finance, software engineering, and law to do the job. Therefore, either education will need to become significantly more industry-focused, or firms will have to identify and develop new talents to become the domain jack of all trades.

The trader of the future will be a multifaceted professional, adept at integrating technology, traditional market expertise, and a broad understanding of the operational aspects of the business. This evolution will streamline trading operations, creating more efficient and dynamic trading desks powered by human-AI collaboration....

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As noted in a post on trading the weather:

....The QBO is just one of the factors that influence the jet stream pattern and because we are dealing with a complex chaotic system, long range jet stream forecasts can be tricky.

Things get really tricky when you superimpose another complex-chaotic system, markets—with their Keynesian beauty contests and Brownian-type movement-morphing into murmuration-like crowd behavior—on top of the weather/climate stuff:

"US issues new restrictions on chip manufacturing exports to China"

From The Hill, December 2:

The Biden administration issued new restrictions Monday on exports of certain semiconductor chips and equipment to China, marking the Biden administration’s latest crackdown to curb the country’s competitive advancements in chipmaking.

The new export controls place more than 100 Chinese chipmaking tool manufacturers on a restricted trade list, prohibiting U.S. companies from sending them equipment without specific permission, the Commerce Department’s Bureau of Industry and Security said Monday.

Leading chip equipment company Naura Technology Group is among the dozens of Chinese companies facing new restrictions.

The move also blocks the sales of certain chips, called “high-bandwidth memory,” which are critical to artificial intelligence training, and some software tools, the federal agency added.

Commerce Secretary Gina Raimondo said the new restrictions seek to “impair” China’s “ability to indigenize the production of advanced technologies that pose a risk to our national security.”

“As technology evolves, and our adversaries seek new ways to evade restrictions, we will continue to work with our allies and partners to proactively and aggressively safeguard our world-leading technologies and know-how so they aren’t used to undermine our national security,” White House national security adviser Jake Sullivan added....

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"Institutional Investment in Space Could Skyrocket as Starman Influence Takes Off"

From Institutional Investor, November 26:

As interest grows, restrictions once preventing wide scale investment could potentially be a thing of the past. 

The space industry was once the exclusive domain of the government. Agencies like NASA in the US, Roscosmos in Russia and the China National Space Administration have long dominated space exploration and the industry surrounding it, making private sector investment or innovation all but impossible.

However, there has been a seismic shift over the last few years that has seen an emergence of increasingly influential private companies almost exclusively focused on (the) space and its commercialization. As a result, big investors are increasingly interested in space, just as they have been in other trends such as AI and crypto.

The rise in interest is tangible. Within the last week alone II has attended two separate investor focused events that have either been entirely focused on the sector or predominantly so. At Deutsche Bank’s Global Space Summit last week, attendance was up by almost one hundred percent compared to 2023 and of just over 400 attendees nearly half were investors; and at Baron Capital’s investor day earlier this month the level of excitement for SpaceX from the 5,000 mostly retail investors in attendance was palpable.

Starman and SpaceX

Ron Baron, founder and CEO of Baron Capital, who affectionately referred to founder and CEO Elon Musk as Spaceman despite not attending the event, outlined interest in SpaceX specifically. “When we started to invest in 2017 they had linear growth but now we have exponential growth, it is really accelerating right now,” he said. “People are clamoring to own stock.”

SpaceX is an undisputed leader in the private space sector, working closely with NASA and launching more rockets into orbit than all its competitors combined, including the Chinese state program. The Starlink satellite internet service also faces very little competition, and its user base is growing fast. Its latest flagship product, Starship, is the largest rocket ever built and has undergone six test flights, with the end goal reportedly to land on the moon.

“Starship is going to change the world, both on planet earth and off,” said Gwynne Shotwell, SpaceX COO, at the Baron event. “Elon [Musk] founded this company with the singular purpose and sole vision to build a transportation system necessary to put people on other planets. His vision is currently on Mars. But we’re all starting to look beyond Mars as well.”...

....MUCH MORE

Ms Shotwell has accomplished one hell of a lot at SpaceX. (though she seems pretty young to be in a museum)

On the other hand there is "Luxembourg's ^#@*&! Space Agency and Fund"

"Tesla Stock Rises After Huge Price Target Increase. Why Analysts Are Excited." (TSLA)

From Barron's December 2:

On Sunday, Stifel analyst Stephen Gengaro raised his Tesla stock price target to $411 from $287. He kept his Buy rating.

Tesla stock rose to start a new week of trading. A couple of things were helping and both are about the same thing: Self-driving cars.

Shares of the electric-vehicle maker were up 3.3% early Monday at $356.56 each, while the S&P 500 and Dow Jones Industrial Average were up 0.2% and 0.1%, respectively. Closing at that level would be a new 52-week high for the stock.

The EV maker is getting a lift from several areas. For starters, there is Wall Street. On Sunday, Stifel analyst Stephen Gengaro raised his price target on Tesla stock to $411 from $287. He kept his Buy rating.

“We believe buying Tesla shares requires vision and patience, and the willingness to accept volatility,” wrote Gengaro. He isn’t wrong. Tesla stock is notoriously volatile. Coming into Monday trading, shares were up about 37% since the Nov. 5 election, accounting for almost all of the year-to-date gains.

The move is despite no change in 2025 earnings estimates. Investors are banking on CEO Elon Musk’s closeness to President-elect Donald Trump benefiting the EV maker. One way it could is if a federal standard were introduced to regulate self-driving cars, which would smooth the introduction of robotaxi services. Tesla plans to launch a self-driving robotaxi service in late 2025.

“While we have confidence in Tesla’s Auto business, the significant value creation potential from its AI-based full self-driving capabilities and Cybercab (Robotaxi) underpin our positive outlook,” added Gengaro.

His target price is now the highest on Wall Street, according to FactSet, valuing Tesla stock at about $1.3 trillion. 

Along with Gengaro’s boost, Roth analyst Craig Irwin upgraded Tesla shares to Buy from Hold. His price target went to $380 from $85. The $295 difference is worth about $950 billion of market value....

....MUCH MORE

This follows some nice words from Dan Ives at Wedbush last week (MarketWatch):

Tesla has a $1 trillion opportunity in AI and self-driving, and the ‘first buddy’ relationship between Musk and Trump could fast-track it 

Elsewhere in Muskland, Axios, December 1: "Scoop: Fidelity marks up the value of its stake in Elon Musk's X"

That is the first major up-mark we've seen since eXtwitter went private. 

Elon overpaid by $20 25 billion. And then with the user exodus and advertiser boycott the remaining valuation was cut in half -again. Someday if I'm in a good mood I'll tell the story.

For what it's worth Disney is back on the platform after leaving in a huff. 

The huff instigation: Elon Musk Says Bob Iger, the Disney CEO He Publicly Told to “Fuck Yourself,” Should Be “Fired Immediately”

"Office CMBS Delinquency Rate Spikes to 10.4%, Just Below Worst of Financial Crisis Meltdown. Fastest 2-Year Spike Ever"

Another of those things we were referring to when looking at the American Presidential election last March.* Following on November 26's "New York Fed: Extend-and-Pretend in the U.S. Commercial Real Estate Market" we see this at Wolf Street, November 30:

Office-to-residential conversions are growing, but are minuscule because not many towers are suitable for conversion.

The delinquency rate of office mortgages that have been securitized into commercial mortgage-backed securities (CMBS) spiked by a full percentage point in November for the second month in a row, to 10.4%, now just a hair below the worst months during the Financial Crisis meltdown, when office CMBS delinquency rates peaked at 10.7%, according to data by Trepp, which tracks and analyzes CMBS.

Over the past two years, the delinquency rate for office CMBS has spiked by 8.8 percentage points, far faster than even the worst two-year period during the Financial Crisis (+6.3 percentage points in the two years through November 2010).

The office sector of commercial real estate has entered a depression, and despite pronouncements earlier this year by big CRE players that office has hit bottom, we get another wakeup call:

Amid historic vacancy rates in office buildings across the country, more and more landlords have stopped making interest payments on their mortgages because they don’t collect enough in rents to pay interest and other costs, and they can’t refinance maturing loans because the building doesn’t generate enough in rents to cover interest and other costs, and they cannot get out from under it because prices of older office towers collapsed by 50%, 60%, 70%, or more, and with some office towers becoming worthless and the property going for just land value.

Mortgages count as delinquent when the landlord fails to make the interest payment after the 30-day grace period. A mortgage doesn’t count as delinquent if the landlord continues to make the interest payment but fails to pay off the mortgage when it matures, which constitutes a repayment default. If repayment defaults by a borrower who is current on interest were included, the delinquency rate would be higher still.

Loans are pulled off the delinquency list when the interest gets paid, or when the loan is resolved through a foreclosure sale, generally involving big losses for the CMBS holders, or if a deal gets worked out between landlord and the special servicer that represents the CMBS holders, such as the mortgage being restructured or modified and extended. And there has been a lot of extend-and-pretend this year, which has the effect of dragging the problem into 2025 and 2026.

Of the major sectors in CRE, office is in the worst shape with a delinquency rate of 10.4%, far ahead of lodging (6.9%), permanently troubled retail (6.6%), and multifamily (4.2%). Industrial, such as warehouses and fulfillment centers, is still in pristine condition (0.3%) due to the continued boom in ecommerce.

The problem with office CRE isn’t a temporary blip caused by a recession or whatever, but a structural problem – a massive glut of useless older office buildings – that won’t easily go away. The glut is a result of years of overbuilding and industry hype about the “office shortage” that led companies to hog office space as soon as it came on the market in order to grow into it later. But during the pandemic, they realized they don’t need this still unused office space, and they put it on the market for sublease, adding to the glut....

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*On the other hand, I'm not sure you would want to be President during the next four years, there are so many problems that have been growing and metastasizing just beneath the surface of the daily news that the person in the hot seat could end up just plain reviled....

—re-referenced a few times over the summer and last seen two weeks before the election in:

Reminder, Re the Presidential Election: The Chicago Wing Of The Democratic Party May Not Be In It To Win It

Also at Wolf Street, November 29:
Federal Government Interest-Payments-to-Tax-Receipts Ratio Spikes, Debt-to-GDP Worsens Further in Q3

"Shipping Magnate Pivots Her $6 Billion Fortune Towards Equities"

From Bloomberg via gCaptain, November 29:

The family office for Maria Angelicoussis, Greece’s richest shipping magnate, is boosting publicly traded investments after notching up huge gains in private market bets, according to people with knowledge of the matter.

Nicrone, the private investment firm of Angelicoussis Group’s owner, has pivoted since former hedge fund executive Laura Lavers took over last year, the people said, asking not to be identified as details on the firm’s strategy are private. Nicrone previously mostly allocated to private markets.

The family office has also recently hired Ben Goldsmith, a 39-year-old former executive at London-based stock-picking firm Zeno Equity Partners, as part of the refocus, said the people, who asked not to be identified discussing private information. Goldsmith, who left Zeno in March, is now London-based head of public markets at Nicrone, according to his LinkedIn profile.

A representative for Angelicoussis – who has a net worth of $6.6 billion, according to the Bloomberg Billionaires Index – declined to comment. Goldsmith didn’t respond to a request for comment....

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Writing: "How forensic linguists use grammar, syntax and vocabulary to help crack cold cases."

Forensic linguists, who knew?

From The Dial, November 21:

Can a Comma Solve a Crime?

On the evening of October 16, 1984, the body of four-year-old Grégory Villemin was pulled out of the Vologne river in Eastern France. The little boy had disappeared from the front garden of his home in Lépanges-sur-Vologne earlier that afternoon. His mother had searched desperately all over the small village, but nobody had seen him.

It quickly became clear that his death wasn’t a tragic accident. The boy’s hands and feet had been tied with string, and the family had received several threatening letters and voicemails before he disappeared. The following day, another letter was sent to the boy’s father, Jean-Marie Villemin. “I hope you will die of grief, boss,” it read in messy, joined-up handwriting. “Your money will not bring your son back. This is my revenge, you bastard.”

It was the beginning of what would become France’s best-known unsolved murder case. The case has been reopened several times, and multiple suspects have been arrested. Grégory’s mother, Christine, was charged with the crime and briefly jailed but later acquitted. Jean-Marie also served prison time after he shot dead his cousin Bernard Laroche, who had emerged as a prime suspect. The investigating judge, Jean-Michel Lambert, who was assigned the case at age 32 and made critical mistakes early in the investigation, killed himself in 2017.

In France, the use of stylometry — the study of variations in literary styles — has largely been confined to academic circles. The Grégory case is the first time it has been applied in a major criminal investigation.

More than three decades after Grégory’s murder, police brought in a team of Swiss linguists from a company called OrphAnalytics to examine the letters and their use of vocabulary, spelling and sentence structure. Their report, submitted in 2020, and part of which was leaked to the press, pointed to Grégory’s great-aunt, Jacqueline Jacob. The results echoed earlier handwriting and linguistic analysis that had led to Jacob and her husband’s arrest in 2017. (The couple was freed later that year over procedural issues.)

While the new evidence has not yet been presented in court, some believe it could help to solve the case that has haunted an entire generation. It has also shone a spotlight on the little-known field of forensic linguistics. In France, the use of stylometry — the study of variations in literary styles — has largely been confined to academic circles. The Grégory case is the first time it has been applied in a major criminal investigation....

....MUCH MORE 

Bringing to mind the introduction to an April 2023 post:

When first I saw that Niall Ferguson had set himself in business as a consulting historian (shades of Sherlock) I thought "How do you hustle up business?":

INT. Corridors of Power - Morning 

President: So gentlemen we are agreed? 

General: Ma'am, I'm still not sure. I think we better ask an historian

But the trans-Atlantic scholar seems to be doing quite well for himself. Here he is at Bloomberg Opinion, April 9....

"China's Nov factory activity growth hits 5-month high, Caixin PMI shows"

From Reuters, December 2:

China's factory activity expanded at the fastest pace in five months in November as new orders, including those from abroad, led to a solid rise in production, pushing manufacturers' optimism degree to an eight-month high, a private-sector survey showed on Monday.

The reading largely echoed an official survey on Saturday, which showed manufacturing activity expanded modestly, suggesting a blitz of stimulus is finally trickling through the world's second-largest economy just as Donald Trump ramps up his trade threats.

The Caixin/S&P Global manufacturing PMI rose to 51.5 in November from 50.3 the previous month, the highest since June and beating analysts' forecasts in a Reuters poll of 50.5.

New orders placed with Chinese manufacturers increased at the fastest rate since Feb. 2023. 

New export orders, in particular, rose for the first time in four months and marked the highest in seven months. The orders mainly rose in the investment and intermediate goods segments and fell fractionally for consumer goods makers.

Anecdotal evidence revealed that better underlying demand, new product launches and stockpiling following the U.S. election were among the reasons for the rise in new work....

Stimulus and for exports maybe frontrunning tariffs?

Norway: "How Taxing Unrealized Gains Has Caused an Entrepreneurial Exodus"

From hagaetc at Paragraph, November 28:

Norway Shrugged

Recently, my story as a Norwegian entrepreneur facing an unrealized gains wealth tax bill many times higher than my net income went viral, amassing over 100 million views on X. A few years ago I publicly called out that this tax is both impossible-to-pay and nonsensical, but no politician would listen. So I made the difficult decision to leave my home country. I still don’t know how I was supposed to pay the tax, but I recently found myself plastered on the "Wall of Shame" at the Socialist Left Party's offices.

In this post, I'll delve into why there's an entrepreneurial exodus from Norway, how we got here, and what the future might hold.

Norway: A real life Atlas Shrugged 

Ayn Rand's 1957 novel Atlas Shrugged paints a vivid picture of a dystopian society where government overreach and socialist policies kill innovation and demonize entrepreneurs. In Rand's world, working hard and taking risks is not celebrated, but looked at with suspicion. As the government tightens its grip, mandating how businesses should operate, the nation's entrepreneurs begin to vanish and are nowhere to be found. People get poorer while the state keeps growing. Step by step the functioning of society starts to crumble. The trains first go off schedule, then start crashing and eventually stop going all together.

Present-day Norway mirrors this dystopia in unsettling ways. Taking risk with your own money, working hard and then making a profit is frowned upon. While politicians spending the people’s money on non-viable green projects, and delivering dysfunctional public services at high costs has the moral high ground. The government is spending 35 Billion NOK on offshore wind that industry experts think is financially unviable. This is about the same amount as the total wealth tax revenues. Norway spends 45% more than Sweden on health care per capita with approximately the same health outcomes. Norway has 2,5 times bigger share of the working population on sick leave than Denmark. Norway spends ~50% more than Finland on primary and secondary school with worse results.

With unshakeable ideological conviction, socialist politicians are rapidly undermining Norway’s wealth creation. They're imposing taxes that explicitly disadvantage Norwegian business owners, and are often straight up impossible to pay. When confronted with the reality that you can't pay taxes with money you don’t have—or that loss-making businesses can't afford massive dividends just to cover owners' wealth taxes—the response is vague moralism like "Those with the broadest shoulders must bear the heaviest burdens." Any argument against any part of the system is by default invalid because there’s free health care…

Norway's entrepreneurs are now indeed disappearing from society. In the past two years alone, a staggering 100 of Norway's top 400 taxpayers, representing about 50% of that group's wealth, have fled the country to protect their businesses....

....MUCH MORE 

"How to Use The New China Tariffs to REDUCE Your China Manufacturing Costs"

Can the dream of turning compliance into a profit center be far behind?*

From China Law Blog, November 27:

Yesterday, in Trump’s New Tariffs and Their Impact on U.S. Trade with China, Mexico, and Canada, I analyzed the new tariffs President-Elect Trump has talked about enacting against China, Mexico, and Canada. In that post, I explored the potential impacts of the proposed tariffs, including the broader implications for companies that import products from China for sale in the United States. Additionally, I predicted that the tariffs against China are very likely to be implemented, whereas those against Mexico and Canada are much less likely to take effect.

In this post, I will delve into the specifics of leveraging the threat of tariffs on China to negotiate reduced costs with your Chinese manufacturer. Additionally, I will discuss the risks associated with this approach and provide strategies to mitigate them.

Chinese Manufacturers Are VERY Worried
China’s producer prices have been falling for 24 straight months. I repeat. China’s factory prices have been declining for 24 straight months. Two years.

Needless to say, this trend has caused considerable consternation among Chinese factories, a reality I witness daily in my work. Pre-Covid, approximately 75 percent of the manufacturing agreements we drafted—including China NNN Agreements, China Manufacturing Agreements, China Product Development Agreements, and China Mold Ownership and Protection Agreements—were signed without any revisions from the Chinese side. Today, that percentage has increased to about 95 percent, and any revisions typically come from large Chinese companies producing hard-to-source products.

In other words, Chinese factories realize they have lost leverage.

Desperate Chinese factories are lowering their prices, and most Chinese factories are desperate right now. My firm’s international manufacturing lawyers have observed a trend consistent with these findings: a significant number of Chinese factories are reducing their prices in a bid to remain competitive. This reflects a broader state of urgency within China’s manufacturing sector and, indeed, in China’s economy at large. See today’s CNBC story, China’s industrial profits fall by 10% in October as deflation worries linger.

It’s bad out there. Really bad.

Not every Chinese factory is in a dire situation, but a substantial number are compelled to negotiate lower prices due to economic pressures. Many of our clients sourcing products from these factories have successfully negotiated meaningful reductions in costs. This high success rate underscores a widespread willingness among Chinese manufacturers to adjust prices, reflecting their response to an increasingly tough economic environment and their own levels of desperation.

China Product Prices Have Been Falling for 24 Straight Months
China’s plunging producer prices and profit margins are putting industrial output and jobs at risk. This downturn is exacerbating other economic challenges, including a property and debt crisis. There is no denying the depth of China’s economic troubles or its high and rising unemployment rate. In response, the Chinese Communist Party (CCP) has reverted to a familiar strategy in times of economic weakness: increasing subsidies to manufacturers to help them stay in business and prevent layoffs.

With it becoming increasingly easy for foreign product buyers to shift their purchasing outside China, and with Chinese factories also relocating their production overseas, the Chinese government’s subsidies have reached unprecedented levels. These subsidies are enabling significant price reductions. We have clients who have successfully negotiated discounts of 25-50% (yes 50%) with their Chinese suppliers by proposing increased purchase volumes or by extending contract terms. We have other clients that have secured substantial price reductions unconditionally, with Chinese manufacturers readily agreeing to cuts of 15% to 25% without demanding further commitments. 

Now Add in Trump’s China Tariff 

President Trump’s plan to impose an additional 10% tariff on goods imported from China has intensified the climate of uncertainty and fear among Chinese manufacturers. These manufacturers are well aware that tariff increases will lead to a reduction in orders from U.S. companies seeking cheaper manufacturing alternatives elsewhere.

This situation gives you unprecedented leverage in product pricing negotiations. The threat of losing business to competitors in more cost-effective regions compels Chinese manufacturers to accommodate their existing U.S. product buyers.

I know from the tariffs President Trump enacted during his first administration exactly how companies can and must leverage this fear to their advantage.

You currently have a strategic advantage, and you should approach your Chinese manufacturers with a proposal to “share” in dealing with the tariff challenges. Framing the conversation around the need to share in the costs of the tariffs is a non-confrontational/face-saving/win-win way to get Chinese manufacturers to reduce their prices in both parties’ best interests. It’s far better to present this as a “partnership” strategy than as demand or an ultimatum.

Again, I know this from what I saw during the last round of China tariffs.

It also benefits you to frame these negotiations as an opportunity for your Chinese manufacturer to secure a long-term relationship with your company, ensuring stability for them in an unpredictable market. Consistently emphasize “long-term” in your discussions, but do NOT commit to any legally binding long-term agreements. This is surprisingly easy to achieve....

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*Opportunity is where you find it.

From April 6, 2018:

Artificial Intelligence For Compliance

Some years ago I was peddling a personal investment for Merrill brokers with billion dollar books-o-business, back when a billion was real money. This led to a couple scenes that I think of from time to time.
After doing the paperwork with one of these retail titans I asked if I should send a copy to his compliance officer. He got a sincerely confused look on his face and said: "I own compliance."

Since then it has been a dream to capitalize on various prime broker functions. Here's one example:

Artificial Intelligence in Risk Management: Looking for Risk in All the Wrong Places
Opportunity is where you find it, turn your risk manager into a profit center....

And while the following link doesn't address the dream directly, I'm sure there's an edge in here in other ways.....

"Donald Trump has been secretly communicating with ‘man crush’ Jamie Dimon about White House agenda for months: sources"

From the New York Post, November 29:

JPMorgan Chase CEO Jamie Dimon has been communicating with Donald Trump in recent months through secret back channels, helping the president-elect hammer out a policy agenda before and since his decisive White House victory, The Post has learned.

The 68-year-old Wall Street titan — who, like 78-year-old Trump, grew up in Queens in New York City — has acted as “a sounding board” for the incoming commander-in-chief’s economic manifesto, four sources close to Trump’s transition team said.

One GOP insider said the president-elect’s inner circle held a series of “no-holds-barred conversations” with Dimon — who at the time was rumored to be eyeing a government job himself.

“They have been speaking regularly for months,” said another GOP source briefed on the situation.

Three of the sources close to Trump said the secret back channel focused on plans for cutting government spending, banking regulation, taxes and trade....

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California to Commence Special Session to Prepare for Potential Federal Litigation

From the firm Brownstein Hyatt Farber Schreck via JDSupra, November 8:

Earlier today, Gov. Gavin Newsom announced a special legislative session aimed at equipping California with the financial and legal resources needed to defend its policies and values in anticipation of potential challenges from the incoming Trump administration. This session will provide immediate budget authority for the California Department of Justice and other state agencies to uphold California’s laws in court and potentially join multistate litigation opposing federal actions. This approach mirrors the proactive steps the California State Legislature took in 2016, prior to the first Trump administration.

Key Focus Areas

The proclamation calling for the special session does not specify exact litigation efforts but emphasizes several areas California is prepared to defend:

• Reproductive rights: Safeguarding state laws ensuring access to reproductive health services.
• Clean vehicle policies: Preserving California’s strict vehicle emissions and environmental standards.
• Deferred Action for Childhood Arrivals (DACA): Protecting the rights of DACA recipients and California's broader immigrant community.
• Immigration policies: Contesting federal actions that may lead to family separation.
• Disaster response: Supporting California’s established disaster recovery policies and resources.

Legislative Timeline

The Senate will commence this special session on Monday, Dec. 2, 2024, as it organizes for the 2025-26 legislative session. The special session will continue concurrently with the regular session, set to start in January....