May 1, 2013
- It can even be stitched into your clothes: The “miracle material” acquires Silly Putty characteristics
- Book it: Records and near-records logged after the April gold swoon
- Just as U.S. becomes more dependent on Iraqi oil, the Iraqi civil war rears its ugly head
- The devolution of coinage… another unintended consequence of the Internet sales tax… a snoozer of a May Day… and more!
“How can something one million times thinner than a human hair,” CNN asks MIT’s Tomas Palacios, “be 300 times stronger than steel and 1,000 times more conductive than silicon?”
According to Palacios, the magic lies within the “special atomic arrangement.”
We begin today’s episode with some of Palacio’s points of admiration. They may sound familiar:
- Electrical currents “move faster than in any other material we know of”
- “It is the best thermal conductor that we have”
- “Thinnest material in the world”
- Strongest too. “Much stronger than steel…”
- “and, of course, much lighter.”
Yep, graphene’s back in public thought.
Truth be told, it never left. In fact, the forecasts for the “magic material” have only become bolder since we last visited it mid-March.
“Products such as cellphones will be integrated into the likes of the clothes, pieces of paper and in windows,” Palacios tells CNN.
“Basically, we are going to have electronic displays embedded almost everywhere, in the windows, in our glasses, in the walls, everywhere.”
And the support for graphene has continued to grow too. If you recall, our graphene mentions came to a halt when Samsung crushed our hopes for an early 2013 bendy smartphone launch.
To be fair, though, they did go out of their way to announce the future of graphene-packed electronics at the 2013 International Consumer Electronics Show in Vegas.
Youm: The future of bendable electronics
The European Union seems doubly impressed with graphene.
Since doling out 1 billion euros for further research, they’ve likened their flagship graphene project to the U.S.’ Apollo 11 moon landing and the Human Genome Project.
“Recently,” Palacios goes on, cluing us in on the latest, “Samsung Electronics has demonstrated a single layer of graphene which is 30 inches in diameter. So in just a few years, we have gone from micrometer-sized flakes all the way to 30 inches.
“The ambition,” he says, “is that one day graphene will be fabricated in the same way that you print newspapers — in a roll-to-roll process using the same kind of equipment. This will change the entire economics of the electronics industry.”
[Ed. note: No matter where we see it first, one thing’s for sure: Graphene is the key ingredient shaping future tech. That said, Byron’s favorite graphene play is set to pounce well before the first products reach the shelves. You can learn more about this company that’s still trading less than a dollar per share, here.]
Precious metals drifted down overnight in electronic trading, and positively tanked when Comex trading opened at 8:30 a.m. EDT.
At last check, gold had been dealt a $27 setback, to $1,450. Silver’s down nearly 4%, to $23.44.
The numbers are final: The demand for physical metal in April brought the highest sales for Gold Eagles in more than three years… and the best April ever for Silver Eagles.
Gold Eagle sales totaled 209,500 ounces. The only months to notch a higher total were when Eagles first went on sale in 1986… and in December 2009, when the Mint finally put its “fractional” sizes back on sale after a year’s hiatus.
“The price drop has made it possible for many retail buyers to add gold,” Todd Dutkevitch of American Bullion Inc. tells Bloomberg.
Silver Eagle sales totaled 4,087,000. Our informal glance at the Mint’s records indicates that’s the sixth-best month for sales.
After another record close for the S&P 500, stocks are drifting down this morning. The S&P is at 1,590.
While traders await the outcome of the Federal Reserve’s two-day meeting — which should arrive about the time you read this — they’re chewing on two disappointing numbers…
- Private-sector payrolls: Only 119,000 new jobs in April, according to the payroll firm ADP. Not only was that less than the “expert consensus,” the March figure was revised down
- U.S. manufacturing: Still growing, but barely, in the estimation of the ISM survey. The number was 50.7, with 50 the dividing line between expansion and contraction.
Were it not for growth in new orders and production, the ISM number would have been negative.
“The underlying trend proves so far that the market is stronger than the soft economic data,” says Greg Guenthner.
Greg says the old saw “Sell in May and go away” doesn’t apply right now. “Like clockwork, stocks have stalled in the spring for three years. But this time around, the market looks strong. Right now, as the S&P accelerates its move toward the top of its broad trend channel, 1,600 is beginning to feel like a powerful magnet…
“Stocks have churned higher in a broad trend channel for more than four years. Since the market dropped sharply in late 2011, this uptrend has found a steeper slope — tightening toward the new highs we experienced just a few weeks ago.
“The defensive sectors have cemented themselves as market leaders. They’re absolutely crushing it. Stick with these safe names to top the market averages this spring.”
Iraq has replaced Nigeria on the list of America’s top five foreign oil suppliers. Too bad the place is descending into civil war. Again.
“Soldiers are deserting a beleaguered Iraqi army,” reports The Independent’s Patrick Cockburn, “as it struggles to keep its hold on the northern half of Iraq in the face of escalating hostility from Sunni Arabs and Kurds who dominate in the region.”
As with the conflict in Syria we unpacked yesterday, much of the conflict in Iraq is about the centuries-old Sunni-Shiite divide.
Recall the U.S. war in Iraq ended with Shiites in charge, lording it over the Sunnis. The Sunnis are getting restive. Last week, they organized a sit-in protest. The army opened fire, killing at least 50 people.
Back in Baghdad, Cockburn reports that leading Iraqi politicians are talking for the first time about partitioning the country. “I believe Iraq is going through its most critical phase since the creation of the state in 1921,” says former Iraqi national security adviser Mowaffak al-Rubaie.
Nor would partition go peacefully: Rather, it would be more “the bloodbath when India and Pakistan divided” in 1947. As many as a million people were killed, and 12 million more fled their homes for good.
So there’s Iraq… and there’s Syria. Those are only two possibilities for the Sunni-Shiite divide to blow up into full-scale war. You’d best consider what that means for the oil market — and your portfolio — while there’s still time.
Because the downgrade from silver to copper-nickel in 1965 wasn’t enough: Legislation in Congress proposes to replace every commonly circulated coin — even the dime and quarter — with steel. American-made, of course.
For coin buffs, the news will take you back to WWII, when the need for copper drove Uncle Sam to mint steel pennies in 1943.
The Ohio representative who introduced the bill, Steve Stivers, claims the move would save $433 million over 10 years. We’re sure it has absolutely nothing to do with the fact that Ohio is one of the top three steel-producing states.
Yeah, right. The Mint isn’t funded by annual appropriations, so it’s not really saving anything. It’s kind of like when the Fed says it made “profits.”
In any case, we can’t say we didn’t see this coming. In fact, one of our researchers uncovered a way to reel in potential gains of 228% based on the news. Seriously… All the proof is right here.
“The unintended consequences,” a reader chimes in about the Internet sales tax proposal racing through Congress, “will be to offshore sales that otherwise would occur over the Internet within U.S. borders.
“The North American Free Trade Agreement forbids international tariffs on sales across NAFTA signatory borders. So if I’m Bill’s Internet Sales of America, I just change name and location of record to Bill’s Internet Sales of Canada. I make my sales, I ship the product just like tax-happy Amazon wants to do and I laugh all the way to explosive growth because I’m undercutting stupid American taxers yet again. Never fails.
“The other unintended consequence of this tax grab is the decline of mom and pop entrepreneurs who want to operate legitimately. The ones who benefit are those who scheme their way around this as noted above.
“The law of unintended consequences will not be disregarded. It doesn’t permit it.”
The 5: We might have been a little remiss singling out Amazon in our coverage on Monday. They’re hardly the only supporter. The big-box stores are also pushing hard.
Political action committees (PACs) backed by the likes of Wal-Mart, Target, Best Buy, Lowe’s and Home Depot are big donors to some of the bill’s supporters. This year alone, “The legislation’s sponsor in the Senate, Sen. Mike Enzi (R-Wyo.), picked up $5,000 from Home Depot and $1,000 from Wal-Mart’s PAC,” according to the Center for Responsive Politics.
“I got to thinking there has to be some sort of Comex-bullion spread arbitrage,” a reader writes on the subject of gold manipulation.
“Then I saw that large bars (that you might get on taking delivery) are selling at exactly the spot price. Since only government mints can deliver the popular coins that are recognized as legal tender (for border crossings and the like), this broken market could persist for a long time!
“Maybe a large player could buy some out-of-the-money options on silver and then immediately buy expiring silver futures and take delivery. But I guess the fear there would be that they get taken behind the woodshed like the Hunt brothers in 1980.”
“I consider Ron Paul as being right about 95% of the time, but not this one,” a reader writes on the subject of Bitcoin.
We’ll pause to recall the good doctor’s words to Bloomberg: “If I can’t put it in my pocket, I have some reservations about that. But it’s been designed in the free market. If it’s a means of exchange, it would not ever be illegal.”
“He’s underestimating the government’s ability to take action when it’s in the government’s best interest,” the reader says. “Right now, the U.S. government ‘tolerates’ Bitcoin because they don’t regard it as a threat, but if it becomes a common enough method of settling debts, then expect for them to suddenly decide that all Bitcoin holders turn over their digital currency to the government so that the government can ‘protect it.’
“The only true currency is gold and silver that you personally have that the government doesn’t know about and can’t find.”
The 5: That depends on how well you hide it!
Cheers,
Dave Gonigam
The 5 Min. Forecast
P.S. It’s a quiet May Day. The few people in Greece who still have jobs are out on strike. But in the United States, there’s nary a sign of the Occupy movement — perhaps last year was its last gasp.
Even our traditional tip of the chapeau on this day to Red Emma’s has a sense of finality. The “worker-owner collective” whose coffee shop and bookstore has given many an Agora Financial employee a caffeine jag over the years is pulling up stakes.
May 18 is the last day at their current location, two doors down from our own. They’re moving about a mile north, where they promise “a vastly expanded book selection, a dedicated on-site classroom space and a full vegan/vegetarian restaurant.”
It’s good to know a small business is doing well. Even one that’s hostile to business in general…