COVID has disrupted supply chains in two major ways: surging demand for imported consumer goods in the West due to pandemic work from home trends and other home improvement spending, and a decline in workers required to maintain and operate these supply chains. The surge in US import demand has led to a sharp rise in eastbound freight rates (see charts for Shanghai->LA and Shanghai->Rotterdam). However, westbound freight rates have not risen nearly as much, leading to an odd and problematic phenomenon: incentives for container owners to move them back to China empty to accelerate receipt of eastbound freight rates, instead of waiting for containers to be refilled to earn westbound freight rates as well. This is illustrated in the fourth chart which shows departing containers from LA/LB: a lot of them started leaving empty once eastbound freight rates surged. This further exacerbates supply chain issues, since US goods (i.e., grains) that were supposed to depart US railcars and warehouses for export remain in place, occupying space that US imported goods were destined for.
Author(s): Michael Cembalest, Chairman of Market and Investment Strategy
British pension funds are ramping up their investment in Chinese companies despite growing tensions between the West and the Communist state.
According to a new report by Hong Kong Watch, a pro-democracy advocacy group, the amount of cash invested by Western pension funds and other institutional investors in China has hit a record high in recent months.
It comes amid rising criticism in the West about China’s human rights record, including its brutal treatment of Uighur Muslims and its suppression of democracy campaigners in Hong Kong.
The report cites the Universities Superannuation Scheme (USS), one of the UK’s largest private pension schemes, and Legal & General, Britain’s biggest pensions manager, as two British firms with “problematic” investments in China.
It found that L&G’s China fund was previously investing UK pensions in Zhejiang Dahua Technology, which is alleged to produce facial recognition software for the Communist Party that detects the race of individuals and alerts the police when it identifies Uighur Muslims.
L&G has since divested from Zhejiang Dahua Technology.
The party has ended. Years of aggressive borrowing have collided with Beijing’s crackdown on debt, leaving the developer on the brink of collapse. Construction of Evergrande’s projects in many cities has stopped. The company has faced a litany of complaints and protests from suppliers, small investors and home buyers who sank their savings into properties the company promised to deliver.
Cash is so short that this summer, the developer said it began paying bills to contractors and suppliers with unfinished apartments instead of actual money. A paint supplier based in the southeastern province of Fujian said Evergrande recently paid off the equivalent of $34 million in bills with three unfinished properties, which the supplier is trying to sell. At a construction firm in Wuhan, more than 200 employees have been forced to take pay cuts because some of Evergrande’s bills are past due, a manager at the firm said,
Former and current employees say layoffs are adding up, and free meals that Evergrande used to provide for staffers at its headquarters have been canceled. In central China’s Hubei province, Evergrande has asked the local government to take over homeowners’ funds held in escrow accounts so they can’t be seized in legal disputes with creditors, according to people familiar with the matter.
Evergrande didn’t respond to requests for comment. The company said on Sept. 14 that its apartment sales have slowed markedly since June, its asset-disposal plans haven’t materialized, and it has hired financial advisers — a move that brings it closer to a potential debt restructuring.
Growing investor angst about China’s real estate crackdown rippled through markets on Monday, adding pressure on Xi Jinping’s government to prevent financial contagion from destabilizing the world’s second-largest economy.
Hong Kong real estate giants including Henderson Land Development Co. suffered the biggest selloff in more than a year as traders speculated China will extend its property clampdown to the financial hub. Intensifying concerns about China Evergrande Group’s debt crisis dragged down everything from bank stocks to Ping An Insurance Group Co. and high-yield dollar bonds. One little-known Chinese property developer plunged 87% before shares were halted.
Hong Kong’s benchmark Hang Seng Index slumped 3.3%, its biggest loss since late July. The selling also spilled over into the Hong Kong dollar, offshore yuan and S&P 500 Index futures. Holiday closures in much of Asia may have exacerbated the volatility, traders said.
“The repercussions from Evergrande’s prospective collapse will likely contribute to China’s ongoing economic deceleration, which in turn anchors global growth and inflation, and casts a pall over commodity prices,” wrote analysts led by Phoenix Kalen, head of emerging-market strategy in London.
1970 Boston Globe: Scientist Predicts New Ice Age by 21st Century said James P. Lodge, a scientist at the National Center for Atmospheric Research. 1971 Washington Post: Disastrous New Ice Age Coming says S.I. Rasool at NASA. 1972 Brown University Letter to President Nixon: Warning on Global Cooling 1974 The Guardian: Space Satellites Show Ice Age Coming Fast
1989 Salon: New York City’s West Side Highway underwater by 2019 said Jim Hansen the scientist who lectured Congress in 1988 about the greenhouse effect. 2000 The Independent: “Snowfalls are a thing of the past. Our children will not know what snow is,” says senior climate researcher. 2004 The Guardian: The Pentagon Tells Bush Climate Change Will Destroy Us. “Britain will be Siberian in less than 20 years,” the Pentagon told Bush.
2013 The Guardian: US Navy Predicts Ice Free Arctic by 2016. “The US Navy’s department of Oceanography uses complex modeling to makes its forecast more accurate than others. 2014 John Kerry: “We have 500 days to Avoid Climate Chaos” discussed Sec of State John Kerry and French Foreign Minister Laurent Fabious at a joint meeting.
The latest Chinese market to buckle under pressure from Beijing’s wide-ranging corporate crackdown: junk bonds.
Companies from China make up the bulk of Asia’s roughly $300 billion high-yield dollar bond market, thanks to a surge in borrowing by the country’s heavily indebted property developers.
But the investor optimism that drove that borrowing has collapsed.
The widening regulatory crackdown that sparked a big selloff last month in the shares of internet-technology and education companies has also weighed on Chinese credit markets, pushing down prices of even investment-grade bonds.
The moves show China is getting more serious about reining in companies whose business practices are seen at odds with national priorities. Investors are now actively looking for sectors that might be next in the crosshairs.
Atop editor at the New York Times instructed Times staffers not to investigate the origins of COVID-19, two Times employees confirmed today.
‘In early 2020,’ a veteran Times employee tells me, ‘I suggested to a senior editor at the paper that we investigate the origins of COVID-19. I was told it was dangerous to run a piece about the origins of the coronavirus. There was resistance to running anything that could suggest that [COVID-19 was manmade or had leaked accidentally from a lab].’
In November 2019, it emerged that China Daily had failed to disclose to federal authorities millions of dollars in payments to US outlets including the Times and the Washington Post. In August 2020, the Times quietly scrubbed the China-funded advertorials from its website. Still, in October 2020, the Times ran an op-ed by Regina Ip, a member of Hong Kong’s Executive Council, justifying the repression of anti-government protests in the Hong Kong SAR.
NEW YORK (AP) — A new analysis of blood samples from 24,000 Americans taken early last year is the latest and largest study to suggest that the new coronavirus popped up in the U.S. in December 2019 — weeks before cases were first recognized by health officials.
The analysis is not definitive, and some experts remain skeptical, but federal health officials are increasingly accepting a timeline in which small numbers of COVID-19 infections may have occurred in the U.S. before the world ever became aware of a dangerous new virus erupting in China.
The pandemic coronavirus emerged in Wuhan, China in late 2019. Officially, the first U.S. infection to be identified was a traveler — a Washington state man who returned from Wuhan on Jan. 15 and sought help at a clinic on Jan. 19.
CDC officials initially said the spark that started the U.S. outbreak arrived during a three-week window from mid-January to early February. But research since then — including some done by the CDC — has suggested a small number of infections occurred earlier.
In gain-of-function research, a microbiologist can increase the lethality of a coronavirus enormously by splicing a special sequence into its genome at a prime location. Doing this leaves no trace of manipulation. But it alters the virus spike protein, rendering it easier for the virus to inject genetic material into the victim cell. Since 1992 there have been at least 11 separate experiments adding a special sequence to the same location. The end result has always been supercharged viruses.
A genome is a blueprint for the factory of a cell to make proteins. The language is made up of three-letter “words,” 64 in total, that represent the 20 different amino acids. For example, there are six different words for the amino acid arginine, the one that is often used in supercharging viruses. Every cell has a different preference for which word it likes to use most.
In the case of the gain-of-function supercharge, other sequences could have been spliced into this same site. Instead of a CGG-CGG (known as “double CGG”) that tells the protein factory to make two arginine amino acids in a row, you’ll obtain equal lethality by splicing any one of 35 of the other two-word combinations for double arginine. If the insertion takes place naturally, say through recombination, then one of those 35 other sequences is far more likely to appear; CGG is rarely used in the class of coronaviruses that can recombine with CoV-2.
In fact, in the entire class of coronaviruses that includes CoV-2, the CGG-CGG combination has never been found naturally. That means the common method of viruses picking up new skills, called recombination, cannot operate here. A virus simply cannot pick up a sequence from another virus if that sequence isn’t present in any other virus.
Wuhan is also home to China’s foremost coronavirus research laboratory, housing one of the world’s largest collections of bat samples and bat-virus strains. The Wuhan Institute of Virology’s lead coronavirus researcher, Shi Zhengli, was among the first to identify horseshoe bats as the natural reservoirs for SARS-CoV, the virus that sparked an outbreak in 2002, killing 774 people and sickening more than 8,000 globally. After SARS, bats became a major subject of study for virologists around the world, and Shi became known in China as “Bat Woman” for her fearless exploration of their caves to collect samples. More recently, Shi and her colleagues at the WIV have performed high-profile experiments that made pathogens more infectious. Such research, known as “gain-of-function,” has generated heated controversy among virologists.
By spring of 2021, the debate over COVID-19’s origins had become so noxious that death threats were flying in both directions.
In a CNN interview on March 26, Dr. Redfield, the former CDC director under Trump, made a candid admission: “I am of the point of view that I still think the most likely etiology of this pathogen in Wuhan was from a laboratory, you know, escaped.” Redfield added that he believed the release was an accident, not an intentional act. In his view, nothing that happened since his first calls with Dr. Gao changed a simple fact: The WIV needed to be ruled out as a source, and it hadn’t been.
Three researchers from China’s Wuhan Institute of Virology became sick enough in November 2019 that they sought hospital care, according to a previously undisclosed U.S. intelligence report that could add weight to growing calls for a fuller probe of whether the Covid-19 virus may have escaped from the laboratory.
The details of the reporting go beyond a State Department fact sheet, issued during the final days of the Trump administration, which said that several researchers at the lab, a center for the study of coronaviruses and other pathogens, became sick in autumn 2019 “with symptoms consistent with both Covid-19 and common seasonal illness.”
China’s National Health Commission and the WIV didn’t respond to requests for comment. Shi Zhengli, the top bat coronavirus expert at WIV, has said the virus didn’t leak from her laboratories. She told the WHO-led team that traveled to Wuhan earlier this year to investigate the origins of the virus that all staff had tested negative for Covid-19 antibodies and there had been no turnover of staff on the coronavirus team.
Marion Koopmans, a Dutch virologist on that team told NBC News in March that some WIV staff did fall sick in the autumn of 2019, but she attributed that to regular, seasonal sickness.
It isn’t unusual for people in China to go straight to the hospital when they fall sick, either because they get better care there or lack access to a general practitioner. Covid-19 and the flu, while very different illnesses, share some of the same symptoms, such as fever, aches and a cough. Still, it could be significant if members of the same team working with coronaviruses went to hospital with similar symptoms shortly before the pandemic was first identified.
Author(s): Michael R. Gordon, Warren P. Strobel, Drew Hinshaw