DEC 02. Why China can’t give up “ZERO COVID” ?

It was a clear fact that wide protest in China over the COVID lockdowns made huge differences indeed. Since then, China is in heavy debate over what to do from here, some people have angers over lockdowns but at the same time, some people really have fears about the opening up.

So, what should they do? But first, Chinese need to know where they stand at the moment, what’s real threat they face with this pandemic. For past 3 years, officially, 5,200 people died in China because of COVID. Same period of time, 1 million people died in USA, 700,000 people died in Brazil and worldwide total, roughly around 4 million people died.

Last month, Dr. Zhou Jiatong (Head of the Center for Dieses Control in Southern China) estimated that if the main land China had loosened COVID restrictions as the same way that Hong Kong did this year, it could cause 233 million infections and 2 million deaths. Maybe this is the main reason why China have so obsessed on ZERO COVID protocols so far. With the already collapsed health care systems in China, opening up everything could means destruction of the nation.

Without China’s comeback as the engine of the global growth, the world economy will be doomed.

Let’s face our reality…

US stock markets had finished this week with another choppy trading. DJ Index was up 0.1% but S&P 500 Index was downed by 0.1% and NASDAQ index was downed by 0.2% today.

Better than expected US job market numbers added complexity over the FED’s decision this month. Apple fell 0.3%, MS was up 0.1% with Tesla, up 0.1% but Amazon was downed by 1.4% today.

No clear directions shown yet.

US Dollar Index was downed again today. Fall another 0.2% and settled at 104.51 points today. Japanese Yen, British Pound were all valued up against US Dollar today, not much, just a bit.

Same thing, no clear directions shown yet.

Crude oil market prices collapsed once more today but closed higher in weekly endings. Based on NYMEX Brent oil futures, price fall more than 1.5%, settled at $85.57 per barrel.

Everyone is waiting for the OPEC meeting on this coming Sunday. OPEC members are strongly saying that they could reduce more than 2 million barrels per day this time. However, not many people really agreed on that.

If they failed to reduce the production again, crude oil price could go down further.

Let’s wait and see.

In the agricultural world, EPA supplied another shocking news to the market. Canola oil can be added on RIN credit list with electric cars which means, less demand for soybean oil.

This week only, CME soybean oil futures fall more than 10 cents per pound.

One and half months ago, producing soybean oil meant easy money with government subsidy and heavy demand from the bio diesel markets but now, soybean crushing business in USA has been f#*%ed seriously by Biden.

US and Brazil are in much better weather forecast for Dec but Argentine is not. We need to wait and see how Bio fuel markets develop from here.

No clear direction shown as well.

Have a good weekend and be safe..

Germany dropped in the World cup.