By JustForex

The US Federal Reserve Vice Chair Lael Brainard hinted that the US Central Bank would continue its mission to reduce inflation despite the worsening growth outlook. The policymaker predicts that the recovery in the year’s second half will be limited. A 75 basis point hike in November and a peak rate of 4.60-4.70% is now the main target, but additional hawkish comments could spur additional panic amid a longer tightening cycle. The White House also added fuel to the fire after it unveiled new export restrictions on US companies selling semiconductor chips and other manufacturing equipment to China, which led to the fall of tech companies. As the stock market closed Monday, the Dow Jones Index (US30) decreased by 0.32%, and the S&P 500 Index (US500) fell by 0.75%. The Technology Index NASDAQ (US100) lost 1.04%.

Equity markets in Europe were mostly down on Monday. German DAX (DE30) declined by 0.01%, French CAC 40 (FR40) fell by 0.45%, Spanish IBEX 35 (ES35) was 0.31% lower, British FTSE 100 (UK100) closed yesterday with 0.45% loss.

British government bond prices fell on Monday, indicating that investors have yet to be persuaded by Finance Minister Kwasi Kwarteng’s desire to bolster confidence in the budget. Also, on Monday, the Bank of England expanded the scope of its emergency intervention. But strategists at JPMorgan said they believe long-term British yields will continue to rise, keeping the pound from falling.

The US dollar strengthened sharply in early trading on Monday after Russia launched a series of missile strikes on critical infrastructure in Ukraine and on ordinary residential areas, including the capital Kyiv. A total of 85 missiles and more than 20 kamikaze drones were fired at Ukraine. 43 missiles and 8 drones were shot down. Eight regions of Ukraine were temporarily left without power supply, 19 civilians were killed, and approximately 105 were injured, including children. Nothing strategic, nothing tactical, nothing meaningful, just one-sided terrorism by the Russian Federation. Having suffered serious losses on the front, all Russia has to do is simply shoot at civilians to somehow compensate for its despair and agony.

After the massive missile attack on Ukraine, protests against the war and in support of Ukraine began in European capitals. Estonia is officially considering recognizing Russia as a sponsor of terrorism.

Oil prices fell by 2% yesterday as the dollar index continues to strengthen, and investors are concerned that COVID will reduce demand in China. A strong dollar reduces demand for oil, making it more expensive for buyers using other currencies. Analysts added that the consistent zero COVID-19 policy in China ahead of the Communist Party Congress doesn’t help demand. But it is worth realizing that the fundamental backdrop points to rising oil prices, as OPEC+ last week decided to lower its production target by 2 million barrels per day. At the same time, investors should not forget that the EU sanctions on Russian oil and oil products will come into effect in December and February, respectively.

Asian markets traded lower yesterday. Japan’s Nikkei 225 (JP225) lost 0.71% over the day, Hong Kong’s Hang Seng (HK50) fell by 2.95%, while Australia’s S&P/ASX 200 (AU200) dropped 1.40%.

Shares of chipmakers Anji Microelectronics Tech Co Ltd and Chengdu Xuguang Electronics Co Ltd fell about 20% after the White House unveiled export controls barring Chinese companies from certain semiconductor chips made with US equipment. Technology heavyweights Alibaba Group Holding Ltd, Baidu Inc, and Tencent Holdings Ltd lost 2% to 4%. The US actions threaten to worsen trade ties between the world’s two largest economies and could have deeper economic consequences if China retaliates.

Also in the spotlight, this week is the 20th Congress of the Chinese Communist Party, which is expected to determine government policy for the next five years.

S&P 500 (F) (US500) 3,612.39 −27.27 (−0.75%)

Dow Jones (US30) 29,202.88 −93.91 (−0.32%)

DAX (DE40) 12,272.94 −0.060 (−0.01%)

FTSE 100 (UK100) 6,959.31 −31.78 (−0.45%)

USD Index 112.75 +0.49 (+0.44%)

• – Australia NAB Business Confidence (m/m) at 03:30 (GMT+3);
• – UK Average Earnings Index (m/m) at 09:00 (GMT+3);
• – UK Claimant Count Change (m/m) at 09:00 (GMT+3);
• – UK Unemployment Rate (m/m) at 09:00 (GMT+3);
• – US FOMC member Mester Speaks at 19:00 (GMT+3);
• – Switzerland SNB Chairman Jordan Speaks at 19:45 (GMT+3);
• – UK BoE Gov Bailey Speaks at 21:35 (GMT+3).

By JustForex

This article reflects a personal opinion and should not be interpreted as an investment advice, and/or offer, and/or a persistent request for carrying out financial transactions, and/or a guarantee, and/or a forecast of future events.

By ForexTime 

Article by ForexTime

ForexTime Ltd (FXTM) is an award winning international online forex broker regulated by CySEC 185/12 www.forextime.com

By Nicholas Peters, University of Tennessee 

Unhackable communications devices, high-precision GPS and high-resolution medical imaging all have something in common. These technologies – some under development and some already on the market all rely on the non-intuitive quantum phenomenon of entanglement.

Two quantum particles, like pairs of atoms or photons, can become entangled. That means a property of one particle is linked to a property of the other, and a change to one particle instantly affects the other particle, regardless of how far apart they are. This correlation is a key resource in quantum information technologies.

For the most part, quantum entanglement is still a subject of physics research, but it’s also a component of commercially available technologies, and it plays a starring role in the emerging quantum information processing industry.

Pioneers

The 2022 Nobel Prize in Physics recognized the profound legacy of Alain Aspect of France, John F. Clauser of the U.S. and Austrian Anton Zeilinger’s experimental work with quantum entanglement, which has personally touched me since the start of my graduate school career as a physicist. Anton Zeilinger was a mentor of my Ph.D. mentor, Paul Kwiat, which heavily influenced my dissertation on experimentally understanding decoherence in photonic entanglement.

Decoherence occurs when the environment interacts with a quantum object – in this case a photon – to knock it out of the quantum state of superposition. In superposition, a quantum object is isolated from the environment and exists in a strange blend of two opposite states at the same time, like a coin toss landing as both heads and tails. Superposition is necessary for two or more quantum objects to become entangled.

Entanglement goes the distance

Quantum entanglement is a critical element of quantum information processing, and photonic entanglement of the type pioneered by the Nobel laureates is crucial for transmitting quantum information. Quantum entanglement can be used to build large-scale quantum communications networks.

On a path toward long-distance quantum networks, Jian-Wei Pan, one of Zeilinger’s former students, and colleagues demonstrated entanglement distribution to two locations separated by 764 miles (1,203 km) on Earth via satellite transmission. However, direct transmission rates of quantum information are limited due to loss, meaning too many photons get absorbed by matter in transit so not enough reach the destination.

Entanglement is critical for solving this roadblock, through the nascent technology of quantum repeaters. An important milestone for early quantum repeaters, called entanglement swapping, was demonstrated by Zeilinger and colleagues in 1998. Entanglement swapping links one each of two pairs of entangled photons, thereby entangling the two initially independent photons, which can be far apart from each other.

Quantum protection

Perhaps the most well known quantum communications application is Quantum Key Distribution (QKD), which allows someone to securely distribute encryption keys. If those keys are stored properly, they will be secure, even from future powerful, code-breaking quantum computers.

While the first proposal for QKD did not explicitly require entanglement, an entanglement-based version was subsequently proposed. Shortly after this proposal came the first demonstration of the technique, through the air over a short distance on a table-top. The first demonstrations of entangement-based QKD were published by research groups led by Zeilinger, Kwiat and Nicolas Gisin were published in the same issue of Physical Review Letters in May 2000.

These entanglement-based distributed keys can be used to dramatically improve the security of communications. A first important demonstration along these lines was from the Zeilinger group, which conducted a bank wire transfer in Vienna, Austria, in 2004. In this case, the two halves of the QKD system were located at the headquarters of a large bank and the Vienna City Hall. The optical fibers that carried the photons were installed in the Vienna sewer system and spanned nine-tenths of a mile (1.45 km).

Entanglement for sale

Today, there are a handful of companies that have commercialized quantum key distribution technology, including my group’s collaborator Qubitekk, which focuses on an entanglement-based approach to QKD. With a more recent commercial Qubitekk system, my colleagues and I demonstrated secure smart grid communications in Chattanooga, Tennessee.

Quantum communications, computing and sensing technologies are of great interest to the military and intelligence communities. Quantum entanglement also promises to boost medical imaging through optical sensing and high-resolution radio frequency detection, which could also improve GPS positioning. There’s even a company gearing up to offer entanglement-as-a-service by providing customers with network access to entangled qubits for secure communications.

There are many other quantum applications that have been proposed and have yet to be invented that will be enabled by future entangled quantum networks. Quantum computers will perhaps have the most direct impact on society by enabling direct simulation of problems that do not scale well on conventional digital computers. In general, quantum computers produce complex entangled networks when they are operating. These computers could have huge impacts on society, ranging from reducing energy consumption to developing personally tailored medicine.

Finally, entangled quantum sensor networks promise the capability to measure theorized phenomena, such as dark matter, that cannot be seen with today’s conventional technology. The strangeness of quantum mechanics, elucidated through decades of fundamental experimental and theoretical work, has given rise to a new burgeoning global quantum industry.

About the Author:

Nicholas Peters, Joint Faculty, University of Tennessee

This article is republished from The Conversation under a Creative Commons license. Read the original article.

By Andrian Lee, University of Wisconsin-Milwaukee and Melissa Scanlan, University of Wisconsin-Milwaukee 

When storms like Hurricane Ian strike, many people have to cope afterward with losing water service. Power outages mean that pumps can’t process and treat drinking water or sewage, and heavy stormwater flows can damage water mains.

Ian’s effects echoed a similar disaster in Jackson, Mississippi, where rising river water overwhelmed pumps at the main water treatment plant on Aug. 29, 2022, following record-setting rain. The city had little to no running water for a week, and more than 180,000 residents were forced to find bottled water for drinking and cooking. Even after water pressure returned, many Jackson residents continued to boil their water, questioning whether it was really safe to drink.

Jackson had already been under a boil-water notice for more than a month before the crisis, which arrived like a slow-motion bullet to the city’s long-decaying infrastructure. Now, Jackson and its contractors face lawsuits and a federal investigation.

We study water policy with a focus on providing equitable access to clean water. Our research shows that disadvantaged communities have suffered disproportionately from underinvestment in clean and affordable water.

However, a historic increase in federal water infrastructure funding is coming over the next five years, thanks to the Infrastructure Investment and Jobs Act that was enacted in 2021.

If this funding is managed smartly, we believe it can start to right these wrongs.

A complex funding mix

Water infrastructure has two parts. Drinking water systems bring people clean water that has been purified for drinking and other uses. Wastewater systems carry away sewage and treat it before returning it to rivers, lakes or the ocean.

Money to build and maintain these systems comes from a mix of federal, state and local sources. Over the past 50 years, policymakers have debated how much each level of government should contribute, and what fraction should come from the most prized source: federal money that does not need to be repaid.

The 1972 Clean Water Act created a federal grant program, managed by the Environmental Protection Agency, to help states and municipalities build wastewater treatment plants. Under the program, federal subsidies initially covered 75% of project costs.

In the 1980s, the Reagan Administration challenged this arrangement. Conservatives argued that the grant program’s main purpose – addressing the need for more municipal wastewater treatment – had been fulfilled.

In 1987, Congress replaced wastewater grants with a loan program called the Clean Water State Revolving Fund, which still operates today. The EPA uses the fund to provide seed money to states, which offer low-interest loans to local governments to build and maintain wastewater treatment plants. Congress created a corresponding program, the Drinking Water State Revolving Fund, in 1996 to fund drinking water infrastructure.

As a result, U.S. water infrastructure now is funded by a mix of loans that must be repaid, principal forgiveness awards and grants that do not require repayment, and fees paid by local users. The larger the share that can be shifted into grants and principal forgiveness, the less pressure on local ratepayers to foot the bill for long-term infrastructure investments.

What’s in the infrastructure law

The Infrastructure Investment and Jobs Act authorizes more than US$50 billion for water infrastructure over the next five years. This won’t close the gap in funding needs, which the EPA has estimated at $472.6 billion from 2015 through 2034 just for drinking water systems. But it could support tangible improvements.

When water systems that serve low-income communities borrow money from state programs, even at low interest rates, they have to pay the loans off by raising rates on customers who already struggle to pay their bills. To reduce this burden, federal law allows state programs to provide “disadvantaged communities” additional subsidies in the form of principal forgiveness and grants. However, states have broad discretion in determining who qualifies.

The infrastructure law requires that 49% of federal funding for both drinking water and wastewater infrastructure must be awarded as additional subsidies to disadvantaged communities. In other words, almost half the money that states receive in federal funds must be awarded as principal forgiveness or outright grants to disadvantaged communities.

Who counts as ‘disadvantaged’?

In March 2022, the EPA released a memorandum that calls the infrastructure law a “unique opportunity” to “invest in communities that have too often been left behind – from rural towns to struggling cities.” The agency pledged to work with states, tribes and territories to ensure the promised 49% of supplemental funding reaches communities where the need is greatest.

This is an issue where the devil truly is in the details.

For example, under Mississippi’s definition of “disadvantaged community,” Jackson’s 2021 award for principal forgiveness was capped at 25% of the original principal. In its March 2022 memorandum, the EPA identified such caps as obstacles for under-resourced communities.

Mississippi appears to have responded by using a new standard for funds coming from the infrastructure law. Beginning this year, communities whose median household income is lower than the state median household income – including Jackson – will be awarded 100% principal forgiveness, which makes the funding effectively a grant.

Additionally, the EPA discourages using population as a factor to define “disadvantaged communities.” Communities with smaller populations struggle to cover water systems’ operating costs, so that challenge is important to consider. But using population as a determining factor penalizes larger cities that may otherwise be disadvantaged.

For example, in 2021, when determining principal forgiveness, Wisconsin awarded a higher financial need score to communities with populations below 10,000. This penalized Milwaukee, the state’s largest city, with almost a quarter of its people experiencing poverty.

In September 2022, Wisconsin updated its definition to consider additional factors, such as county unemployment rate and family poverty percentage. With these changes, Milwaukee now qualifies for the maximum principal forgiveness.

Mississippi and Wisconsin previously relied on factors too narrow to reach many disadvantaged communities. We hope the steps they have taken to update their programs will inspire similar actions from other states.

Getting the word out

In our view, the Infrastructure Investment and Jobs Act is a once-in-a-generation opportunity to correct decades of underinvestment in disadvantaged communities, especially with the EPA pushing the states to do so.

Historically under-resourced communities may not be aware of these state program funds, or know how to apply for them, or carry out infrastructure improvements. We believe the EPA should direct states that receive federal funds to help under-resourced communities apply for and use the money.

Recent events in Jackson and Florida show how natural disasters can overwhelm water systems, especially older networks that have been declining for years. As climate change amplifies storms and flooding, we see investing in water systems as a priority for public health and environmental justice across the U.S.

About the Author:

Andrian Lee, Water Policy Specialist, University of Wisconsin-Milwaukee and Melissa Scanlan, Professor and Lynde B. Uihlein Endowed Chair in Water Policy, UW-Milwaukee School of Freshwater Sciences; Director of the Center for Water Policy; Affiliate Faculty, University of Wisconsin Law School, University of Wisconsin-Milwaukee

This article is republished from The Conversation under a Creative Commons license. Read the original article.