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tv   Boom Bust  RT  February 27, 2021 1:30pm-2:01pm EST

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this is finally set to pass that long awaited $1.00 trillion dollar stimulus package labeled by democrats as the american rescue plan and a virtual meeting with the nation's governors president biden said the goal for the package is to provide some much needed relief the economic toll this pandemic continues to tear through our country is brutally as the virus is so. and so we need to comfort the economic you know we we just have to step up the economic toll we have to address with the same aggressiveness and seriousness of purpose as we do the virus. that's what the american rescue plan does you said chasing covert 19 allows us to get ahead of it the current package includes $1400.00 stimulus checks $400.00 per week and unemployment insurance $20000000000.00 for a national code 19 vaccination program and $350000000000.00 for state and local aid
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it is expected to be sent to the sun on friday nearly 2 weeks before several key provisions from the last package are set to expire. the prices of both gold and oil took a hit on friday with gold declining for the 2nd month in a row as u.s. treasury yields remained high oil was also down as a selloff in the bond market lifted the us dollar on top of that we are now learning that last week's winter storm in texas led to the 2nd largest natural gas withdrawal in u.s. history so joining me now to discuss it all is david mckelvey nice to see the mcelveen a financial group now david let's start with oil here it's now estimated that as a result of the production freeze texas likely lost between 18000000 and 40000000 barrels of oil what kind of a long term impact are we looking at here. right great question i think the long term impact from the freeze is minimal the real impact was last year when we had
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the rig count get decimated and so what we really saw as a definitive 2021 event was recalibrating for us production. we continued to expand we got to the point where we were exporting oil not importing and that net export profile that may not ever return certainly not under the current administration and to me that is a bigger long term impact what happened as a result of coal that and the production shut ins in 2020 then the temporary freeze that we've seen in the last week or so so this is just another hit the the country seems to be taking after and are reading along here now at the same time we've seen a lot of optimism when it comes to oil prices bouncing back but some analysts are warning that oil is already too high too soon are there legitimate concerns about whether the demand will be there to match your original it's a great point i think we are ahead of ourselves in terms of demand perfectly matching price and there is still
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a lot of economic activity that needs to return for us to justify a price north of $60.00 a barrel so hopefully there's global follow through in terms of covert recovery but i would say there are a whole lot of other assets that are way overpriced oil is nowhere near the top of the list if you're talking about something that is anticipating who are getting a little ahead of itself in terms of that recovery story yeah that's a good point there now let's take a look over at gold it's prices have declined for a 2nd month in a row amid a surgeon bond yield is called the sunshine are being left behind right now because of its lack of interest rates or do you think that there's more to the story there . you know there's really good math on that rachael going back to the summers are risky thesis in the 1980 s. larry summers did an extensive study on the relationship between gold and interest rates so the answer to your question is yes and no futures traders are in tune with the short term twists in terms of the interest rate market and they are in fact getting out of gold but investors are a little bit different they need
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a compelling case and your 10 year break even in the us treasury is sitting about 2.16 percent so 2 measures of inflation c.p.i. $1.00 p.c. each is the fed's favorite measure of $1.00 and now you have the 10 year treasury this week stretching just about 1.5 percent to be honest rachel that's not a compelling income story you're at break even and what would an investor really needs is real rates of return that are positive by 15250 basis points that is to 2 and a half percent above the inflation rate then all of a sudden you see investors starting to clamor out of gold and into treasuries given the price action of government bonds this week i don't think we're seeing a bill out of gold and treasuries i think you are seeing a lot of futures market traders and that of course is they carry a pretty big stick. i own some cases they are happy to break even there but now when we're talking about call them when we're talking about some of these different
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commodities there has been a lot of talk about the right conditions coming together to create some sort of super cycle do you think that as we saw the price of gold you know we thought rally last year copper is reaching new highs and silver could even mean that some are saying so is it likely that the commodities boom we're seeing right now is actually going to reach that high of a supercycle even this year. yeah i think the trend is in play for a super cycle the idea of reaching a height in 2021 i do not see and in fact i think it has many years typically you have 357 even 10 years of under-investment in the commodities and it takes almost that amount of time 35 to 7 years for prices to play catch up and price ins up being the determining factor now there is investment that can flow back into the space and so we're seeing that we're seeing a recovery in agriculture prices we're seeing a recovery in industrial metals were seeing a recovery in gold and silver but still very conservative capital allocation within
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all of those spaces what you would be looking for at the height of a commodity boom is where companies are being reckless with the money that they're making and that is not the case today i think we're a long way from that so i think the supercycle trend is in play and answer your question but we have a lot further to go both in terms of price and timeframe. a lot further to go fames them even if they meant they're all around ok advise and great points to consider here david mack ommaney thank you so much for your time today. thank you rachel. another scare involving a boeing triple 7 is renewing concerns about their planes and their engines the airliner was forced to make an emergency landing in moscow on friday pilots received an inner kater warning of a possible engine failure the flight was on its way from hong kong to madrid when it changed course to mock out main airport russian officials say only about 25 people were on board the mostly cargo flight it landed safely with nobody harmed at
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this point it is unknown whether there actually was a problem with an engine or if it was a false alarm dozens of boeing triple 7 jetliners remain grounded after a pratt and whitney engine broke apart over colorado last week. markets are mostly down this week but there are a few bright spots starting in russia the mo axis down this week after hitting record highs citing oil prices contributed to the losses ahead of opec plus meetings next week to decide on the state of production cuts moving forward and china the shanghai composite dropped significantly to close out the week following u.s. markets as a sharp rise in the bond yields affected investor sentiment there was a significant sell off of health care and consumer stocks on wednesday as investors saw them as overvalued and hong kong the hong sang is down dropping more than 3.5
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percent in response to the finance secretary's announcement of an increased stamp duty on stock trading in japan the nikkei is also in the red suffering is the biggest drop since april of last year on friday slipping bond yields contributed and semiconductor manufacturers took a hit and in india the sun sex's down stocks were also hit by that sell off we watched in the region as the index fell nearly 4 percent and the rupee dropped 1.4 percent its. biggest decline since march of last year we have another red arrow in australia the a.s.x. lost nearly 2 percent this week the tech sector was hit the hardest dropping more than 7 percent to a 3 month low the world's biggest supplier of commercial explosives orica plunged 27 percent in the midst of a trade dispute with china then in south africa the all share is down as the country's finance minister warns the economy is dangerously overstretched also
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living his budget this week more red arrows in london where the footsie is reacting to those rising bond yields we're seeing and the bank of england is warning it may be tough to control inflation british airways parent company i.a.g. reported a record loss of $9000000000.00 but its shares has seen a 3 percent rise on renewed hopes of air travel returning once again the german dax and french kakkar also down this comes despite the german economy as reported growth in the 4th quarter of 2020 and despite france's tele performance gaining nearly 7 percent after j.p. morgan raised its target price on thursday we have our 1st green arrow of the week in brazil this despite state owned oil petro brass dropping by nearly 20 percent after president both naro ended last week with a push to oust the head of the company altogether then in mexico at the end the is down this week this comes despite the country's 4th quarter economic growth of 3.3
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percent compared to the previous quarter here in the united states we have 3 more red arrows for you as the dow s. and p. and tech heavy nasdaq were unable to make it into the green it was those bond yields affecting sentiment as the nad nasdaq saw its worst sell off since october on thursday but i was able to make up some of that on friday morning and finishing things up in toronto the ts x. is our last red arrow. the material sector dragged me into x. or earlier in the week as did energy both of which have a heavy influence on canada's economy moving into next week we will continue to monitor bond yields while following the latest regarding the stimulus vote here in the u.s. and that is your global market walk. time
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now for a quick break but when we come back space exploration is the latest hot topic that many want to get involved but what is the role of private companies and what will it mean for the future of nasa all this cast net and as we go to break here the numbers of the clothes.
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were more politicized than ever or more polarized than ever the 21st century wind speed is measured in megabytes per 2nd. so they're still on the record using your location thank you because he came at a chronic electronic money electronic media infinite possibilities for exchanging information i mean me in this kind michelin visitation of life. freedom of speech and social media bends censorship and double standards who should judge what can be said on the line or something. but i want to. come down to the internet audience now totals almost $4500000000.00 to all of them are active social network users but one wrong move on the page is deleted digital. don't exist anymore. gone who runs the show on the web how can anyone stand
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up to the tech giant sci fi from the heads of state faced a threat of being bent is there any limits to hold that virtual town. or. the sort of movie that i was reasonable way. but by administration continues to promise to take action on the north stream to pipeline with many in the g.o.p. calling the project a win for russia if the u.s. does not intervene but what about germany as the one benefiting directly from the north stream to berlin also finds itself facing
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a federal election and as chancellor angela merkel is stepping down after 15 years she appears more committed than ever to the pipeline with one report noting quote no amount of us saying she has will commence merkel to risk letting turn off the spigot in an election year no u.s. concessions on tariffs or nato commitments will persuade her to undercut the products and solvency of german industry no amount of u.s. solidarity will induce her to allow the impression of a veto over german economic sovereignty even as the u.s. pressure causes nearly 2 dozen european companies to abandon the pipeline merkel appears to be standing by the deal with russia. it's time for the u.s. and china to get their relationship back on track at least according to beijing china is pressing the new administration and d.c. to axe many of former president trump policies against the nation in hopes of
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forging better relations with president biden and his team are to use alex my love it tells the story with the trumpet ministration. an opportunity has presented itself to improve relations between the u.s. and china the 2 countries are often at odds but in reality both camps know that they need each other to prosper. but the essence of sino us economic and trade relations is a mutual benefit and when when the interests of both sides are deeply integrated full cooperation will benefit both good will complication you can only hurt cooperation is the only correct choice however in recent years the troubled ministration chose confrontation over cooperation during president trump's time in office the u.s. hiked tariffs on imports from china and imposed bans and other restrictions on chinese companies. and trump didn't stop there. the former
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president and his team went against america's longstanding policy that recognizes the government of the people's republic of china as the sole legal government of china and that taiwan is a part of china instead trumps administration boosted diplomatic and military ties with taiwan. from d.c. also imposed sanctions against chinese officials for unproven claims of abuse against that country's weaker population in addition the u.s. also criticized china's handling of protests in hong kong a movement that lasted for approximately a year before the government crackdown a situation some blame on us interference the list goes on former u.s. diplomat chad's freeman who was instrumental in helping pave the way for the normalization of diplomatic relations between china and the us in 1902 has criticised the trumpet ministrations foreign policy towards china claiming the us
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has consistently been the initiator of conflict with that country freeman has also said to compete with china the us must take a good look at itself according to freeman the us focus has been on tripping up china rather than improving our own international competitiveness without serious repairs to restore a sound american political economy our future is in jeopardy and we will be in no condition to compete with the world's rising in researching great powers especially china while promising to work with america's allies to combat china's so-called aggressive trade policies catherine tie president joe biden's pick for u.s. trade representative echoed freeman's assertion china's simultaneously a rival a trade partner and an outsized player whose cooperation will also need to address certain global challenges we must remember how to chew gum and play chess at the same time. that means here at home we must prioritize resilience and make the
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investments in our people and our infrastructure to harness our potential boost our competitiveness and build a more inclusive prosperity the buy did ministration has signaled that it would continue trumps tough on china approach but there would be some concessions allowed me cooperation on issues like climate change biden has also highlighted the need to refer to us domestically for the nation to be able to compete with china for the best look small part of it. and the world has been captivated by last week's landing of nasa as perseverance rover on the surface of mars this week we have been able to see video of the rover landing on the red planet as well as a stunning high definition panorama of the landing site the success of another unmanned trip to mars raises the questions of what this means for the many private companies who are looking to make that trip themselves in the near future if you
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remember back in october space x. founder it long musk said his company is hoping to send its 1st unmanned starship rocket to mars within 4 years with hopes of creating a permanent and sustainable human settlement on the planet for more of this let's bring in. john professor of business strategy at the paul university where the focus in space commercialization now erin nasa has landed several rovers on the surface of mars in the past so how big of a deal is this and is there anything that really sets this trip apart. this is a massive deal we can't understate how in portland and amazing and technological this was right but i'm going to make an oversimplification space is really just transportation and now it's amazing and tactical and like very hard to do and what we just saw with perseverance was awesome right but the real question is can i get from point a to point b. safely reliably and cheaply and the most recent rover landing was just another
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application of sky crane which means we can now land on space part of the land on mars in a safe reliable and as we do it more often cheap way so this is a really really big deal we can't understate from that perspective he has a setting with incredible president that a lot of other private companies are looking at right now and they're think well wait a 2nd if they can do it then we can do it too so for those companies that have aspirations . landing on the surface of mars in the future what does this mean for that. well it really means that we've demonstrated a way to do this safely right so in dealing with transportation dealing with this technology around space was all about mitigating risk and now that we have a demonstrated reliable way to land on the surface of mars and granted like this is only. we've done this a ton but we've done it now really successfully so now private firms can look at
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this and say i can develop something put it on to the next on manned rover or develop my own unmanned rover and know that there's less risk of this being destroyed in the last mile and that's a that's a big gain when you're thinking about risk mitigation especially when you're thinking about the investment how much time and money goes into it you want to know that it can be successful and that you're not going to lose out on that in the process ok so as more and more private companies join the industry what does that mean for nasa future that. well nasa isn't going away let's just like put that as a full stop not going anywhere but as more private firms get into the space industry and the new space industry and like developing new innovative technologies and solutions it just means nasa is going to have more firms to have joint partnerships with right and nasa is main goal should be about pushing the boundaries of space and understanding you know as a government agency how to make it easier for us to have economic activity out
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there at some point handing off operations to private businesses where it makes sense and so that they can focus in on their main thing which is some scientific exploration yeah that's a really good point and something that you hope that they pay attention to and work on in the future now when it comes to blue origin and virgin galactic they have seen recent setbacks when it comes to their technology but space x. is moving along with this starship program and with massive government contracts as a result do you see space x. as a clear front runner and if so what puts them in that position right now. so if we're talking about blue origin and virgin galactic again space x. we do need to just highlight that virgin galactic is very clearly space tourism has a mix of space tourism and payload delivery to lower earth orbit and space x. is not so much space tourism though that's a part of their business plan and it's
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a lot more about payload delivery low earth orbit and obviously to the international space station so space x. if we're going to just define as someone's doing the best is in the private space industry that's not coming from the 1st wave of space technology development yeah space x. is a front runner they've got these massive government contracts there's a lot to be said for the hype machine that one must know how to run. but i wouldn't necessarily say that they're the they're going to be the winner all the time and i hope they are right i hope that one they they do think safely and efficiently and what not but there's a lot of demand out there for cheaper safe reliable to travel to space whether be the space station or lower earth orbit or other orbits so for the natural now space x. has a strong position because of these massive government contracts that gives them
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a pretty strong leg up yeah definitely on course that doesn't hurt when you've got your long must there on twitter talking seems like everything you talked about has a blown up all over the internet right now ok so now brice faith and technology 2020 investment in this space industry is likely to break $21000.00 record of $5700000000.00 where do investors see their returns or is it still a very expensive hobby for and only for you right now. well so highlight real quick again the oddity of space x. and that hype machine for investors who have space x. shares in their portfolio they can see an r o y really quickly there's so much demand for those stuff for that share right that's not i.p.o. yet like this is just people a secondary market that's developed because of the demand for wanting to invest in them so for that and we have to maybe acknowledge that they're a little different. but space in general is a long game right we have long contracts that are decided upon 4 to 5 to 8 years
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out in advance in some cases 10 years but that's usually with you know some copy outs in place and just like we're just talking a guidepost at that point and so 2020 saw a massive increase in space investment partly because of the hype around space there's been some really amazing technological advancements that i don't want to diminish by calling it hype but i do want to acknowledge that the value of future the value of the future of space is in the future so where we're going to see those and return on investments it's going to be anything that you're investing in that has to deal with space infrastructure using space resources out there like asteroid maybe maybe the moon that gets us to this point right like satellite was she doing moving to different orbits. supplying the international space station those are areas where you'll see the investment come back to you from your from whatever you're putting into your portfolio that relates to space but it has to be a long game there these are short term returns and great points made here today and
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pay go thank you so much for your time on this topic. sad that for this timing have portable t.v. on demand from your apple or android device with you here next time than that though if don't forget the question more. but the damage no. so you know blood is just blind to nationalities. as a mark. we don't. need to be. judging . commentary classist least. we can do better we should know. everyone is contributing way but we also know that this crisis
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will not go on forever the challenge is create the response has been so many good people are helping us. it makes us feel very proud that we are in it together. the british and american governments have often been accused of destroying lives in their own interests or you see in this these techniques is the state devising methods to him to essentially destroy personality of an individual. by scientific means this is how one doctor's theories were allegedly used in psychological warfare against prisoners deemed a danger to the state that was the foundation for the method of psychological interrogation psychological courtroom. disseminated within the u.s. intelligence community and worldwide among our allies for the next 30 years and how
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the victims say they still live with the consequences today. because there's a survival guide book stacie just going to start. the series there you go. oh heck no. repatriations want to get arrested 7 years. philip a separate kaiser report. the world is driven by a dream shaped by. the dares thinks. we dare to ask.
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the spring carmencita's the. wall. for most from no in the early ninety's seventy's how much can a psychologist in 6 all just proposed to the west berlin senate a social experiment he wanted to let paedophiles adopt don't care for neglected boys experiment was approved. it was used to model. don't go on what your. group doctor came to believe that sex with older men would help with the boy's socialization over 30 years many children were handed over for paedophiles to raise just mentioned to christians a little hurt more than the logs and over those 2 words which i believe him the the
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most evil will work rooms or should not least of all good to see someone to go to. san marino becomes the latest european country to start vaccinating its citizens with russia sputnik shot off to supply delays of the e.u. approved jobs the labor minister explained why they look to moscow for help. me an independent state even within the territory of its early and the european union we have the right to make independent decisions. the french government faces flak over its covidien occupation programme after it's revealed hundreds of millions of euros were handed to controversial foreign consultants. divisions deepen in armenia as the president rejects the prime minister's controversial order to sack the armed forces chief as crowds continue to demand the pm quit. and drawing up plans to get children watching more british cult.


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