5 Things You Need To Know Before Markets Open In Australia And Around The World.

Dear Superstructure International Associate,

Good morning! Another Monday. That means another week of work and perhaps another week in stock market rises. While last week increases may have been small, up is still up and the Dow Jones remains strong at over 20,000. Here’s a bit of information you may like to know today, and to get your week started.

1. Elon Musk will back his words with action, so it seems, and bail South Australia out of its power supply woes. While most people think that the idea of his battery power has great merit, the question remains as to why a state in a developed country like Australia has these problems at all! Hot weather means air conditioning. Air conditioning means more power. It’s wonderfully meritorious that South Australia moved most of its power generation to greener means, moving away from coal, but something certainly went astray in the planning process to stop that happening as a smooth transition. The estimated cost of $200 million needs to be weighed up against the losses in business and citizen comfort. Let’s hope it’s resolved soon.

2. On a related topic, Chinese company, Tianqi Lithium, was asked whether it sold its lithium to Elon Musk company, Tesla. A company spokesman stated that Tianqi sells its product to producers of lithium battery cathode material and not directly to car producers and lithium battery makers. However, some of the producers’ customers are part of the Tesla supply chain. That makes it an indirect ‘yes’ it would seem.

3. The Securities and Exchange Commission put a dramatic stop to the meteoric rise of the Bitcoin by denying its request to be included in the exchange trade fund. The drop was a significant 15% and it’s a question of where to now for Bitcoin. Another question is whether this is an opportunity to invest in this digital currency, or is it best to steer clear in case it drops even further.
Remember, for investment reasons it was trading at a higher price than gold before the SEC strangled it.

4. While the price of iron ore is a little up and down, its movements are at the high end of the scale. Remember a year ago that this commodity was selling at between $50 and $65 a tonne. Over a year, it has made strong gains to be at almost $90/tonne and for Australia, which mines a third of the world’s production, that’s good news.

5. There are white lies that usually cost nothing. Then there are big, fat lies about vehicle emissions that can cost you almost $6 billion. VW pleaded guilty (did it have a choice?), and copped it sweet in the USA. That was the fine. The cost of buying back 500,000 vehicles and spending another $25 billion on owners’ claims and assorted legalities has yet to be added. If you ever wanted to understand the vagaries of the share market, VW shares rose by 0.03% as a result of the guilty plea!

Mining Trivia of the Week

Of the top 20 Universities in the world that offer Mining Engineering, Australia holds 6 of the places! Do the math. That means a country that has just 1.4% of the world’s population, has 30% of the best Mining Engineering universities in the world.

If you were ever in doubt the importance of mining in Australia, that should just about convince you.

Andrew Mortimer
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