Links for week October 10

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So, don't get too excited. If you want to profit off it, go to the oil companies that have continued to lower their breakeven: Pioneer Natural Resources (PXD) , EOG Resources (EOG) , Apache (APA) , Parsley Energy (PE) , PDC Energy (PDCE) and SM Energy (SM) . They would be the beneficiaries of anything that keeps oil in the $40s, which this statement might have done.

Oil and Math Don't Mix; Stumpf Going Down: Jim Cramer's Best Blogs - Pg.3 - TheStreet

Kleintop notes that the numerous quantitative easing measures introduced by the Japanese central bank over the years have bloated the country’s monetary base to the equivalent of the U.S. — a country whose economy is four times as large as Japan’s. But for all the money that the central bank has supplied, it is essentially waging a losing battle as the population continues to age. “The growing monetary base seems to have had little in the way of lasting success, with growth remaining soft, but poses rising risks of becoming a monster that wreaks havoc on the country by becoming the biggest owner of Japanese bonds and stocks,” said the strategist.

Why Japan’s Godzilla-sized stimulus is a threat to investors - MarketWatch

And according to Wells Fargo, gold has much further to fall. That is because the precious metal finds itself "knee-deep inside a commodity bear super-cycle," according to John LaForge, the bank's Head of Real Asset Strategy. Looking at data from 1800 through today, commodity bear super-cycles have lasted on average almost 20 years, making this occurrence still rather young.  If prior history is any indication, gold, which peaked at $1,900 per ounce in 2011, could still have another 15 years left before this cycle ends, as could other commodities.  Wells Fargo However, gold bugs should not be too worried about a longer-term sell off. LaForge expects gold to retest its late 2015 low near $1,050 per ounce, possibly in 2017, at which point he says it "could be a good long- term (strategic) buy."

Gold is 'buried knee-deep inside a commodity bear super-cycle' - Business Insider

Gold is facing a nearly 5% loss this week, its biggest weekly drop since November 2015, but Goldman Sachs is telling gold bugs to hang on. The reaction in gold prices to the possibility of a U.S. interest-rate hike at the end of the year has been “larger than we anticipated,” said Goldman analysts Max Layton, Mikhail Sprogis and Jeffrey Currie, in a note released Friday. That leaves risks surrounding their year-end outlook of $1,280 an ounce as “moderately skewed to the downside,” said the analysts.

If gold gets below $1,250 an ounce, start buying: Goldman - MarketWatch

Ludovico Minati, an academic researcher into non-linear systems, discusses the potential of analog circuits to be used to enhance performance in such fields as neuromorphic computation, sensor fusion and secure communications. There is striking dynamical complexity that is readily accessible with networks of even the simplest analog circuits, so long as they are non-linear. A fundamental characteristic of brains is that their capabilities are mostly not hardwired by design, but reflect self-organization: brain networks possess so-called emergent properties that cannot be easily inferred from their separate constituent elements.

Chaotic circuits can mimic brain function, aid computing | Electronics EETimes

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Overseas investors increased their holdings of Chinese sovereign bonds by a record in September before the yuan entered the IMF’s reserves basket. Foreign institutions bought a net 41 billion yuan ($6.1 billion) of government securities to boost their holdings to 385.97 billion yuan, according to data from China Central Depository & Clearing Co. That’s more than three times the average monthly increase this year, and extends an unprecedented buying streak to 11 months.

Foreign Investors Boost China Government Bond Holdings by Record - Bloomberg

The public mechanical clock, which first appeared in European cities in the late 13th century, was one of the most important innovations in history. This column looks at the impact on growth of the arrival of this general purpose technology. European cities that were quick to install mechanical clocks enjoyed greater growth than late adopters. However, it takes some time for the effects from fundamental innovations of this type to be realised because the technology must be accepted both culturally and socially and then applied to related economic activities.

Time for growth | VOX, CEPR’s Policy PortalSecret Money Floods Judicial Elections

In the limbo ahead of the week's big events, traders will watch oil prices and S&P 500 price action Tuesday as signals on future gains. "We've been caught in a sideways range and we're probably going to stay here until we get more clarity on the Fed," said John Caruso, senior market strategist at RJO Futures. "I'll just be watching key resistance levels tomorrow," he said. He's watching to see if the S&P 500 can top 2,164 and then 2,174, before retesting its record close of around 2,190.

Traders watching these clues for a market breakout

HOW WOULD WE GET THERE? That’s the $64 trillion question. Even at the fastest speeds of our current technology, a quick jaunt to check out Proxima b would see us arriving in around 18,000 years, by which time there’s every chance our Earth-bound descendants would have arrived there well ahead of us and grabbed all the glory. But many smart minds – and deep pockets – are being turned to the challenge of finding a faster way to cross vast distances of space. Breakthrough Starshot – a $100 million initiative privately funded by Russian billionaires Yuri and Julia Milner – is focusing on propelling a tiny unmanned probe by hitting its extremely lightweight sail with a powerful Earth-based laser. The idea is that if the spacecraft is small enough – and we’re talking barely a gram – and the sail light enough, the impact of the laser will be enough to gradually accelerate the craft to around one-fifth of the speed of light, taking it to Alpha Centauri in around 20 years. The Milners are counting on miniaturisation technologies to enable this tiny craft to carry a camera, thrusters, a power supply, communication and navigation equipment so it can report on what it sees as it flashes past Proxima b. Hopefully the news will be good, because that will lay the foundation for the next and more difficult stage of interstellar travel: people-moving.

BBC - Future - The myths and reality about interstellar travel

“We are not that bad policemen or bad individuals. We are just a tool, we are just angels that God gave talent to, you know, to get these bad souls back to heaven and cleanse them.” The words flow unnervingly from the mouth of the policeman, a senior officer in the Philippines national police (PNP), as he explains his role in 87 killings in the past three months. It’s not about killing for pleasure, or being a “homicidal maniac”, he says. There is a higher purpose at play. “We are here as angels. Like St Michael and St Gabriel, right,” he says. Well in excess of 3,600 people have been killed in the Philippines since 1 July this year, when Rodrigo Duterte was inaugurated as president and initiated his war on drugs and crime. More than half of those murders have been perpetrated by unknown vigilantes.

Philippines secret death squads: officer claims police teams behind wave of killings | World news | The Guardian

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Turns out graphene, the wonder material with so many potential applications, is also the secret sauce to making tougher silk. A team of scientists from Tsinghua University in Beijing successfully created silk that's twice as tough simply by feeding the material to silkworms.

Graphene-fed silkworms can spin super threads

The market did not fall on Tuesday simply because Alcoa reported a disappointing quarter and the price of oil went down. Jim Cramer thinks a larger force could be taking down some of the largest companies in the stock market. "When you see investors turning on the market's former leaders, that tends to spread doom and gloom and pessimism," the "Mad Money" host said. To gain more insight from the charts, Cramer spoke with technician Rob Moreno, who is a colleague of Cramer's at RealMoney.com and the publisher of RightViewTrading.com.

Cramer: Charts reveal the real culprit taking down the entire stock market

The slow growth the U.S. economy has experienced since the recent recession is not a fleeting condition, rather it's the result with a serious demographic problem that is poised to dampen economic growth for years, according to a recent research paper by three Federal Reserve economists.

The biggest economic horror story is real, according to a new Fed paper

However, Regling said that GDP (gross domestic product) per capita was usually the same as in the U.S., and the region had a "much better income" distribution. "The last 15 years, 80 percent of European households have seen a real income gain. In the U.S., we know it's only 10 to 20 percent. A big difference in favor of Europe," he added.

The man selling Europe's bonds slams Stiglitz, Krugman and US income gains

A lot of people are worried about the growing ranks of jobless young men. George Will says America is suffering a “quiet catastrophe” in which men simply no longer want jobs. Erik Hurst, an economist at the University of Chicago, recently came up with a novel theory to explain this. He suggested that young American men aren’t working because they’re too busy having fun playing video games and living in their parents’ basement. Derek Thompson wrote it up in the Atlantic and Tyler Cowen enhanced the argument by suggesting that young men are also enjoying internet porn, thus eliminating a key non-monetary incentive that drives young men to get a job and their own place.

We still haven’t recovered from the Great Recession - Vox

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On Tuesday in Santa Monica, Calif., BMW Group debuted a motorcycle concept so artificially intelligent that it eliminates the need for the rider to wear protective gear, including a helmet.

BMW Motorrad Vision Next 100 - Bloomberg

HSBC's technical-analysis team has thrown up the ultimate warning signal. In a note to clients released Wednesday, Murray Gunn, the head of technical analysis for HSBC, said he had become on "RED ALERT" for an imminent sell-off in stocks given the price action over the past few weeks. Gunn uses a type of technical analysis called the Elliott Wave Prinicple, which tracks alternating patterns in the stock market to discern investors' behavior and possible next moves.

HSBC: RED ALERT — get ready for a 'severe fall' in the stock market - Business Insider

In a Bloomberg Markets Most Influential Summit Debate, Institute board chairman Adair Turner explains why extraordinary monetary policy isn’t working Good macroeconomic policy can make sure that we hit a reasonable pace of growth of aggregate nominal demand and inflation, and we are failing at that, Institute for New Economic board chairman Adair Turner told a Bloomberg Markets Most Influential Summit debate this week. On a panel alongside former Deutschebank CEO Anshu Jain and USB chairman Axel Weber, Turner cited the zero or near zero inflation rates in Japan, Europe and the U.S. as a sign that the extraordinary stimulus policies of the past eight years had failed. And they were bound to fail, because our belief that ultra-loose monetary policy would work was based on — I think — inadequate macroeconomic theory. The panelists offered sharply divergent views on the causes of and remedies to the problem.

Turner: Why Macroeconomic Policies are Failing

Called the Kirobo Mini, this petite android measures a mere four inches high in his standard sitting position. He's a "communication partner," says Toyota, designed to be a miniature personal companion. Aesthetically, he is halfway between Astro Boy and a Prius. The company plans to sell the robot through car dealerships for 39,800 yen (a bit more than £300), which seems steep only until you see just what a clever little dickens he is. He is capable of engaging in some fairly elaborate and highly animated small talk (only in Japanese, for now), and uses a camera to recognise — through facial expressions, gestures and vocal tone — the emotional state of his, er, human companion. His gaze will follow the movement of his owner's head during the conversation, and his glowing eyes will "blink" to remind the human that she is talking to a sentient being and not, say, an electric toothbrush. Moreover, the device remembers its human companion's likes, dislikes and "shared travels," and will increasingly integrate that information into its conversation. ("We have been here before!" Toyota's brief concept film for the robot walks a fine line between feel-good and creepy, portraying its electronic leprechaun happily interacting with friendless people of all ages. It also depicts a young woman who brings the device on a date and another who leans on him for job-interview advice. Says Toyota, Kirobo Mini "becomes a partner to carve out your future together with." Hm.

BBC - Autos - Toyota creates a tiny personal companion

German Chancellor Angela Merkel urged Russia on Friday to use its influence with the Syrian government to end the devastating bombardment of Aleppo, as her government opened the door to possible sanctions against Russia for its role in the conflict.

Germany opens door to sanctions against Russia over Syria - Business Insider

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Differing central bank policies, uncertain U.S. elections, seasonality and and high stock prices are leaving investors nervous. With these factors in mind, there's a venerable "witches brew" that could wind up causing a 15% correction in markets, leaving investors feeling uneasy, but it's not the end of the world. "The easiest one to spot is earnings and valuations," said Rob Bartenstein, CEO of Kestra Private Wealth Services, which has $1.5 billion in assets under management. Since Brexit happened on June 23, the Dow Jones Industrial Average has gained 2.14%, the S&P 500 has gained 2.7%, but the tech-heavy Nasdaq has tacked on 8.9%, leading Bartenstein to be worried about valuations. If you look at it by sectors, technology is really the only one that's trend at the top end of its range, Bartenstein said.

How to Protect Yourself From a 15% Correction in the Stock Market - TheStreet

For the third quarter, earnings are expected to decline 2.1% for the S&P 500, compared to a 0.3% uptick seen on June 30. If there is an earnings decline, it would be the six consecutive quarterly decline since the third quarter of 2008, when FactSet began tracking the data.

How to Protect Yourself From a 15% Correction in the Stock Market - Pg.2 - TheStreet

Are trade volumes — the bedrock of globalization — on life support? The Brexit vote, the rise of Donald Trump, and shifting economic sands have fed fears that protectionist sentiment will intensify the five-year slowdown in worldwide trade. The precarious outlook for globalization was a hot topic at the Bloomberg Markets Most Influential summit in New York last week. Karthik Sankaran, head of global strategy at Eurasia Group, brought attention to the fact that Trump "led the first 30 minutes" of the first presidential debate on the negative impact of free trade for U.S. workers, reflecting how protectionist sentiment has risen to the top of the political agenda.

Why You Should Stop Worrying About 'Peak Trade' - Bloomberg

Morgan Stanley has updated its annual list of secular growth stocks.  In a note published on Thursday, the firm highlighted 30 stocks that its analysts believe would thrive even if the global economy grows slower than they forecast.  To compile the list, Morgan Stanley first screened for stocks it had previously classified as growth stocks for 48 straight months, which have also generated positive revenue every quarter for the past three years. They then selected stocks they rate as "overweight" or "equal weight."

Best secular stocks according to Morgan Stanley - Business Insider

Yup. There's now a fund that is devoted entirely to brown liquor. It's always 5 o'clock somewhere, right? The Spirited Funds/ETFMG Whiskey and Spirits ETF (try saying that after a few shots) debuted this week. Like most ETFs, it has a cutesy ticker symbol -- WSKY (WSKY). Some of the top stocks in the fund are Diageo (DEO), which owns Johnnie Walker and bourbon maker Bulleit, Pernod Ricard (PDRDF), the owner of Chivas Regal, The Glenlivet and Jameson, as well as America's Brown-Forman (BFB), the parent company of Jack Daniels.

Bottom's up! There is now a whiskey ETF - Oct. 14, 2016

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Immersive media company Matterport have just announced they’re to make available what they claim is the world’s largest collection of VR-focussed real-world models and locations in a bid to become a source of experiences for VR consumers... Now, the company is set to make their extensive library of real-world locations available to everyone. The company have announced today an initiative that allows any consumer to experience these virtual places via their CoreVR ecosystem in VR for free. The press release from Matterport states “For those 3D Spaces with the free CoreVR option, CoreVR will remain available for as long as the content is hosted on Matterport. After 2016, content publishers can simply select the CoreVR option for only $19 per new 3D space.  With the CoreVR feature integrated directly into Matterport Showcase, users can transition quickly from the Web to VR.”

Matterport Creates the "World’s Largest Library" of Real-World VR Places - Road to VR

Princeton economics professors Alan S. Blinder and Mark W. Watson wrote a paper exploring the US economy's performance with respect to United States presidents, dating back to Harry Truman. And one thing they looked at was what happened in the markets during the lame duck session between the election and the inauguration of the new president. "The performance of the stock market between Election Day and Inauguration Day might be taken, in part, as a statement of investor confidence — or lack thereof — in the incoming administration," they suggested. As for the numbers, they noted: "It gives a slight edge to incoming Republicans, despite the fact [...] that stock prices actually rise much faster under Democratic presidents than under Republican presidents. Specifically, the S&P 500 gained a minuscule 0.15%, on average, during the four Democrat-to-Republican transitions, but lost an average of 1.38% during the four Republican-to-Democrat transitions. However, more than 100% of the average Democratic transition loss came because stock prices were crashing during the Obama transition. Since the economy was collapsing at the time, it is hard to attribute this drop to lack of confidence in Barack Obama."

What happens in the stock market after US elections - Business Insider

When autonomous vehicles first reach the road, they may be the perfect complement to existing public transportation, helping to shuttle commuters between their homes and commuter rail stations. When fully self-driving cars arrive, they might replace passenger rail altogether. A new report from The Boston Consulting Group (BCG) sketches that dire future for passenger-train travel and warns private and public rail officials to consider autonomous vehicles as a “serious competitive threat.” Over time, the report says, at least 40 percent of current train passengers will prefer using a driverless car instead of a train.

Self-Driving Cars Could Derail Future of Passenger Trains – News – Car and Driver | Car and Driver Blog

British man could become the first person in the world to be cured of HIV using a new therapy designed by a team of scientists from five UK universities. The 44-year-old is one of 50 people currently trialling a treatment which targets the disease even in its dormant state. Scientists told The Sunday Times that presently the virus is completely undetectable in the man’s blood and if it remains that way it will be the first complete cure.

HIV cure close after disease 'vanishes' from blood of British man

There is little evidence that immigration significantly affects overall employment of native-born US workers. This according to an expert panel's 500-page report. We thought you might like this condensed version from PepperSlice. Bad presentation alert: The report, The Economic and Fiscal Consequences of Immigration, offers no summary visuals and buries its conclusions deep within dense chapters. Perhaps methodology is the problem, documenting the "evidence-based consensus of an authoring committee of experts". People need concise synthesis and actionable findings: What can policy makers do with this information??

Evidence Soup - Improving vs. proving, plus bad evidence reporting