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September 25, 2024

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In this video from StockCharts TV, Julius assesses current rotations in asset classes and US sectors using Relative Rotation Graphs, finding a lot of contradictory behavior. Taking a step back, he focuses on the weekly timeframe to find some more meaningful trends and shy away from day-to-day noise. He then compares the current rotations and setups in price charts with those that occurred at the end of 2021 and moving into 2022, noting some strong analogies that warrant a continued cautious approach to the markets.

This video was originally published on September 24, 2024. Click anywhere on the icon above to view on our dedicated page for Julius.

Past episodes of Julius’ shows can be found here.

#StayAlert, -Julius

The Fed’s rate cuts set the real estate world abuzz, with lower mortgage rates giving homebuyers a little more breathing room. According to the Case-Shiller housing data released on Tuesday, home prices rose 5% in August. Nevertheless, Wall Street expects demand to increase slowly.

The proof? Take a look at the market. The Sector Summary Data Panel on your StockCharts Dashboard displays the performance of the S&P 500 sectors. The image below looks at a three-month performance.

FIGURE 1. SECTOR SUMMARY. Over the last three months, real estate has been the top-performing sector.Image source: StockCharts.com. For educational purposes.

Looking at Real Estate Select Sector SPDR Fund (XLRE) as the sector proxy, you can see that capital has been flowing into real estate stocks over a period of months as Wall Street has been betting on the Fed cutting rates—and it finally happened last week. Below is a weekly chart of XLRE.

CHART 1. WEEKLY CHART OF XLRE. Note that the Distance From 52-Week Highs indicator, which is available in StockChartsACP, indicates XLRE is very close to its one year high.Chart source: StockChartsACP. For educational purposes.

Note the following details:

  • XLRE’s all-time high is at $47.53 (adjusted for dividends), which is not too far from where the ETF is trading.
  • Looking at the Distance From Highs indicator, XLRE is about 0.4% below its 52-week high—answering the question “What does Wall Street think of the real estate sector’s prospects in the coming months?”
  • The StockCharts Technical Rank (SCTR, pronounced “scooter”) line is currently above the 90 line (see red horizontal line on the SCTR indicator), meaning that multiple indicators are bullish across several timeframes.

XLRE has been on a roll, but the big question is—has the real estate rally run its course, or does it still have enough momentum to breach its 52-week high?

Let’s look at a daily chart of XLRE using SharpCharts.

CHART 2. DAILY CHART OF XLRE. There’s lots of space to pull back before the uptrend calls it quits.Chart source: StockCharts.com. For educational purposes.

After bottoming out in April, XLRE has been climbing and is just 0.4% away from its 52-week high—$45.04 (adjusted for dividends). Last week’s tiny pullback stayed within the first Quadrant Line, signaling strength.

Signals are mixed, however: while the On Balance Volume (OBV) indicator shows solid buying pressure, the Money Flow Index (MFI), which operates like a volume-weighted Relative Strength Index (RSI),  suggests otherwise. With prices rising and buying pressure dropping—a bearish divergence—a short-term dip might be on the horizon. If XLRE falls, look to the area within the orange circle as a wide potential support range. More specifically…

  • The 50-day simple moving average (SMA) may climb to the space between the first and second quadrant lines (25% to 50% retracement, respectively); both the 50-day SMA and the first and second quadrants serve as a favorable support area to buy into strength.
  • The Ichimoku Cloud, which is currently bullish, projects a deeper range of potential support within the next 26 days. The lowest point currently matches the 75% range of the quadrant line (third quadrant).
  • If XLRE falls below the third quadrant, marking a 75% retracement, the current uptrend could be in trouble. In this case, it might be time to pause and reassess the technical and fundamental situation before proceeding with any trades.

Closing Bell

The real estate sector has been riding high before and after the latest Fed’s rate cut. Based on the market action, Wall Street has been bullish. However, momentum seems mixed, hinting at a possible short-term breather. If this occurs, watch key support levels to distinguish strong buying opportunities from danger zones.



Disclaimer: This blog is for educational purposes only and should not be construed as financial advice. The ideas and strategies should never be used without first assessing your own personal and financial situation, or without consulting a financial professional.

Keith Watson and Rob Crayfourd, co-fund managers at the Geiger Counter Fund, shared their outlook on uranium supply, demand and prices, plus which companies they think have the most potential moving forward.

While acknowledging the recent price pullback, the experts said the sector’s long-term outlook is positive.

‘Ultimately we’re at the very start of what we expect to be a longer-term imbalance in supply vs. strong demand, and therefore a very healthy price outlook for the sector,’ Watson explained during the interview.

When asked about the Geiger Counter Fund’s focus, Crayfourd highlighted the Athabasca Basin in Saskatchewan, Canada, saying it’s a tier-one jurisdiction that’s home to a slew of strong uranium assets.

‘We think that those projects, particularly Canadian assets that are uncontracted and able to participate in the upside that we see in the market going forward, are best placed,’ he noted. The fund has a heavy weighting toward NexGen Energy (TSX:NXE,NYSE:NXE), Fission Uranium (TSX:FCU,OTCQX:FCUUF) and IsoEnergy (TSX:ISO,OTCQX:ISENF).

Watson added that it also has exposure to US companies with small but reasonable production profiles that are in the process of starting or restarting output, as well as leverage via stocks with slightly higher-cost deposits.

Watch the interview above for more of their thoughts on uranium stocks, as well as the outlook for the commodity.

Securities Disclosure: I, Charlotte McLeod, hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

Sarama Resources Ltd. (“Sarama” or the “Company”) (ASX:SRR, TSX- V:SWA) is pleased to advise that the Company’s acquisition of a majority interest(1) in the Cosmo Gold Project (the “Project”) in Western Australia is advancing towards completion with a majority of the key conditions precedent having been met.

The acquisition received strong support from shareholders at the Company’s recent Annual General Meeting and Sarama has received requisite approval and conditional approval from securities exchanges in Australia and Canada respectively. The Company anticipates the Transaction (defined below) will be completed in late October 2024.

The 580km² project(2) covers the entirety of the Cosmo-Newbery Greenstone Belt and is located approximately 85km north-east of Laverton in a region known for its prolific gold endowment (refer Figure 1). As one of the last effectively unexplored greenstone belts in Western Australia, the Project presents a unique and compelling opportunity for the Company.

Highlights

Sarama acquiring a majority interest in and control of Cosmo Gold Project in Western Australia Majority of key closing conditions satisfied and completion of transaction anticipated in late October 2024Sarama acquiring an initial 80% interest(1) with ability to increase to 100% in the majority of the Project(1)580km² landholding capturing +50km strike length in highly prospective gold producing region; 95km from both the world-class Gruyere Mine and Laverton gold districtProject captures one of the last effectively unexplored greenstone belts in Western Australia; virtually no effective exploration undertaken for several decades Soil geochemistry program to commence imminently to generate regional targets in unexplored areas

Sarama’s President, CEO & MD, Andrew Dinning commented:

“We are pleased to have made significant progress toward completing the acquisition of the Cosmo Gold Project which we view as a compelling opportunity for the Company. Sarama’s shareholders voted overwhelmingly in favour of the Transaction and we look forward to closing the deal and embarking on more extensive exploration programs which will follow on from field programs currently being mobilised.”

Cosmo Newbery Project

The Project is comprised of 7 contiguous exploration tenements covering 580km² in the Eastern Goldfields of Western Australia, approximately 85km north-east of Laverton and 95km west of the world-class Gruyere Gold Mine. The Project is readily accessible via the Great Central Road which services the Cosmo Newbery Community.

The Project captures one of the last unexplored greenstone belts in Western Australia and with a strike length of +50km, the Cosmo Newbery Belt represents a large and prospective system with gold first being discovered in the area in the 1890’s. Multiple historical gold workings are documented within the Project area and work undertaken to date, has identified multiple exploration targets for follow up.

Despite this significant prospectivity, the Project has seen virtually no modern exploration or drilling of merit due to a lack of land access persisting over a significant period. As a result, the Project has not benefited from the evolution of geochemical and geophysical techniques which now facilitate effective exploration in deeply weathered and complex regolith settings which is particularly pertinent given approximately 75% of the Project area is under cover.

Following the relatively recent securing of land access, the Project is now available for systematic and modern-day exploration programs to be conducted on a broad-scale. It is anticipated that future exploration programs will initially follow-up preliminary targets generated from regional soil sampling and limited reconnaissance drilling programs, a majority of which extended to approximately 5m below surface with a small percentage extending up to 30m below surface.

Click here for the full ASX Release

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Nickel sulphide explorer Nordic Nickel Limited (ASX: NNL; Nordic, or the Company) announces the successful completion of a A$1.05 million capital raising to support the Company’s ongoing exploration and project development activities in Finland while adding working capital to allow strategic partnership discussions to continue.

HIGHLIGHTS

Firm commitments received to raise over A$1.05 million through a placement at A$0.06 per share.
The placement was priced at the last closing price and a nil discount to the 15-day VWAP – a strong show of support from existing shareholders for the Company’s critical minerals projects and development strategy in Europe.The Company’s key focus is to maintain the district scale nickel-copper-cobalt opportunity represented by the Pulju tenement package in Finland while avoiding unnecessary dilution for shareholders at a difficult time in the nickel market.The Company continues to advance strategic partnership options to progress the Pulju Project in the meaningful fashion it deserves.

The funds raised through the placement will allow the Company to advance towards its goal of becoming a major long-term European supplier of sustainably sourced, traceable, class-1 nickel sulphides, and other critical metals, from its flagship Pulju Project in northern Finland.

The Pulju Project is an exceedingly rare, district scale nickel-copper-cobalt exploration and development opportunity within a progressive mining district in Europe, hosting both shallow, disseminated nickel sulphides and high-grade massive/remobilised sulphides. The project already hosts an in-situ JORC (2012) Mineral Resource Estimate of 418Mt at the Hotinvaara Prospect containing 862,800t Ni, 22,100t Cu and 40,000t Co1.

To date, the Company has drilled 28 diamond holes for 15,432m at Pulju, within the Hotinvaara licence area only, it being the sole licence granted at the time of the drill campaign in 2023, with multiple wide intersections reported within the prospective ultramafic unit1. The drilled area represents just 2km of the known 35km of mineralised strike that lies within the Pulju project area, highlighting the strong potential for resource growth.

It is intended that later drilling at Pulju will focus on increasing the size of the known resource and, importantly, focus on the structures that may have trapped and concentrated the extensive remobilised sulphides found at Pulju. The thin zones of concentrated, remobilised nickel-iron sulphides so far intersected at Hotinvaara have attained grades of up to 9.6% Ni2, demonstrating that Pulju has the potential for a style of extremely high-grade nickel sulphide mineralisation that has yet to be targeted.

Upcoming Catalysts and Work Program

The Company will continue its work program planned for the next 12 months, and this includes a large amount of work that is near completion, but also detailed technical desktop studies that will underpin regional and localised drill targeting. These are expected to deliver strong value creation catalysts for shareholders.

Proposed upcoming work programs and key catalysts include:

Metallurgical Test Results from Hotinvaara: These results will be important to assess the economic potential of the project, not only at Hotinvaara itself, but throughout the Pulju Belt, given that this style of mineralisation appears to be widespread based on historical regional drilling3.Resource Model: The metallurgical testing should allow the Company to refine the Hotinvaara resource estimate based on the laboratory scale nickel and cobalt results.Base of Till (“BOT”) Drilling Database Results: A new database of over 10,000 historical BOT assay samples have been obtained which, combined with the Company’s own recent BOT drilling at the newly granted Holtinvaara licence, will allow the Company to further assess nickel, cobalt and copper prospectivity across the Pulju Belt.Regional Structural Analysis for High Grade Targeting: An important component in targeting high-grade nickel and copper sulphide mineralisation within the Pulju Greenstone Belt will be to undertake detailed regional structural analysis and interpretation. This will highlight structural features that may host depositional trap sites for remobilised sulphides and can be integrated with existing datasets such as the detailed magnetic survey and the BOT sampling database to prioritise drill targeting.Strategic Discussions (2024): Ongoing strategic investor and joint venture discussions with various interested parties are expected to be finalised in 2025.

Click here for the full ASX Release

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The top countries for gold production are poised to benefit from the current gold bull market, as are the gold mining operations in those countries.

The price of gold has soared through 2024, setting and breaking new all time highs. Prices surged above US$2,600 on the heels of a 50 basis point cut to the US Federal Reserve’s benchmark rate announced on September 18. The widely expected cut comes as the most recent data shows inflation continues to edge closer to the Fed’s 2 percent target rate and alongside a more balanced job market.

Additionally, escalating tensions in the Middle East that threaten to destabilize the oil-producing region may be having a knock-on effect as more investors seek safe-haven assets like gold.

1. China

Gold production: 370 metric tons

China was the world’s top gold mining country in 2023 with output of 370 metric tons. While China’s gold output peaked at 455 MT in 2016, it hasn’t dipped below 300 MT in more than a decade. This consistent production continues to ensure the China’s status as the world’s top gold producer.

China’s gold mining industry is dominated by state-owned operators. Some of the largest companies include China Gold International Resources (TSX:CGG,HKEX:2099), Shandong Gold (HKEX:1787) and Zijin Mining Group (HKEX:2899).

China also hosts major gold-smelting operations. Its Belt and Road Initiative has resulted in Chinese companies exploring and developing sites elsewhere in Asia and Africa, subsequently sending raw resources back to China for refinement.

In addition to being the top producer of gold in 2023, China was the largest consumer of gold at 1,089.69 metric tons. China’s central bank was the largest buyer of the precious metal in 2023, adding 225 metric tons of gold to its coffers during the year to bring its total to 2,235 MT.

2. Australia

Gold production: 310 metric tons

Australia’s 2023 gold production came in at 310 metric tons, largely on par with the previous year’s 314 MT.

Gold is mined at a slew of major operations in the country, with the top five gold mines all located in different states. The top-producing mine is top producer Newmont’s (TSX:NGT,NYSE:NEM) Boddington mine in Western Australia, which produced 589,000 ounces through the first three quarters of 2023.

Australia hosts the world’s largest gold reserves at 12,000 MT, and has an important role in the global supply of gold. It contributed AU$24 billion to the Australian economy in the 2022/2023 period.

2. Russia

Gold production: 310 metric tons

Gold production from Russia came in at 310 metric tons in 2023, the same as the prior year. The country’s output has risen fairly significantly since 2017, when it produced only 255 MT of gold.

The US Geological Survey states that Russian gold reserves stand at 11,100 MT, making it the second largest country for reserves after Australia. However, despite high production and reserves, Russian gold has had problems reaching world markets since the country’s invasion of Ukraine in February 2022. In response, Russian operators have sought out alternative markets, particularly the BRICS nations and other Asian countries like Kazakhstan.

4. Canada

Gold production: 200 metric tons

For 2023, gold production in Canada was 200 metric tons, down a marginal 6 MT from 2022.

Ontario and Quebec are the largest gold-producing provinces in the country; together, they represent more than 70 percent of Canada’s gold output. The Canadian government states that gold is the nation’s most valuable mined commodity, with domestic exports reaching C$22.34 billion worth of the precious metal in 2022.

Additionally, BC’s Golden Triangle is a hotbed for exploration. The region hosts Newmont’s Brucejack gold mine and Red Chris copper-gold mine, the latter of which is a 70/30 joint venture with Imperial Metals (TSX:III,OTC Pink:IPMLF). Junior companies like Goliath Resources (TSXV:GOT,OTCQB:GOTRF) have also made significant discoveries in the region, which has further fueled optimism about the region’s potential.

5. United States

Gold production: 170 metric tons

In 2023, the Unites States produced 170 metric tons of gold, down slightly from the 173 MT it produced in 2022. While that is a marginal decrease, it continues a trend of production declines from 2017, when the US produced 237 MT of gold.

According to the US Geological Survey, the top state for production of the yellow metal was Nevada, which accounted for 73 percent of total domestic production, followed by Alaska with 13 percent. The top 27 operations in the country were responsible for 97 percent of American gold output in 2023.

An assessment of US gold resources shows that the country has approximately 33,000 MT of gold in identified and undiscovered resources. The US Geological Survey notes that close to a quarter of the gold in undiscovered resources can be found in copper porphyry deposits. Gold reserves in the US are estimated at 3,000 MT.

6. Kazakhstan

Gold production: 130 metric tons

Kazakhstan’s 2023 gold output of 130 metric tons represents continued growth in the country’s production of the yellow metal, up from just 69 MT produced in 2016. Kazakhstan’s largest gold-mining operation is the Altyntau Kokshetau mine, which is owned by mining giant Glencore (LSE:GLEN,OTC Pink:GLCNF).

In August 2023, Anglo-Russian company Polymetal International (AIX:POLY), one of Kazakhstan’s largest producers, delisted from the London Stock Exchange in a move geared at severing the link between its Kazakhstan and Russian subsidiaries; it did so in response to tensions resulting from Russia’s invasion of Ukraine. It remains listed on the Astana International Exchange in Kazakhstan and has major operations in the country.

7. Mexico

Gold production: 120 metric tons

Mexico has a long history of gold mining; in fact, the Spanish colonization of Central America in the early and mid-1500s was largely targeting gold and silver. Today, Mexico is among the global leaders in gold production, extracting 120 metric tons in 2023. Precious metals account for 50 percent of the country’s total metal output.

While much of Mexico’s gold mining is controlled by foreign entities, one of the largest operations, the Herradura mine — owned by Mexico City-based Fresnillo (LSE:FRES,OTC Pink:FNLPF) — produced 355,485 ounces of gold, or about 10.08 MT, in the company’s 2023 fiscal year. The mine represents more than half of Fresnillo’s gold production and generates about a quarter of the company’s total adjusted revenue.

8. Indonesia

Gold production: 110 metric tons

The mining industry is one of Indonesia’s most important sectors, and the country is among the world’s top producers of nickel, copper and gold. In 2023, Indonesia produced an estimated 110 metric tons of gold, up 5 MT over the prior year.

Indonesia is home to several large gold operations. The largest is the Grasberg Mining District, a joint venture between Freeport-McMoRan (NYSE:FCX) and Indonesia’s state-owned Indonesia Asahan Aluminium. In 2023, the area produced 1.98 million ounces of gold, or 56.1 MT; it has an estimated 23.9 million ounces contained in mineral reserves.

9. South Africa

Gold production: 100 metric tons

In 2023, South Africa produced 100 metric tons of gold, up from 89 MT in 2022. An estimated one-tenth of global gold reserves are located in the country, and its Witwatersrand Basin is one of the largest gold resources in the world.

South Africa has been a top gold producer for decades, but between 1980 and 2018 the nation’s gold output fell by 85 percent. In recent years, South Africa has been the site of conflicts between the Association of Mineworkers and Construction Union (AMCU) and gold producers in the area. The AMCU has held many protests and strikes at several gold and platinum mines in the hopes of garnering more wages and stopping any mergers that could cause job losses.

Power outages have been creating further strife for South Africa’s gold industry. Limited power generation in the country has caused rolling blackouts, including for miners, the majority of which are connected to the nation’s power grid.

10. Uzbekistan

Gold production: 100 metric tons

Uzbekistan produced 100 metric tons of gold in 2023, in line with its output over the last decade.

Operated by Navoi Mining and Metallurgical Company, Uzbekistan’s Muruntau gold mine is one of the largest gold operations in the world. Massive deposits of gold were first discovered at the site in the 1950s, and it still holds some of the largest reserves in the world at 4,500 MT. The discovery marked the beginning of gold mining in Uzbekistan. The mine produces more than 2.5 million ounces of gold per year and is expected to continue operating into the 2030s.

Following the fall of the Soviet Union in 1991, mining for the yellow metal fell to its all-time lows in the mid-1990s. In 2019, the country’s government announced renewed investment into development and exploration. While that hasn’t yet been reflected in its annual production, upgrades at Muruntau scheduled to be completed in 2026 are expected to increase its output from 38.5 million to 50 million MT metric tons of ore per year.

FAQs for gold investing

How is gold mined?

Gold is mined by several different methods, including: placer mining, hard-rock mining, by-product mining and by processing gold ore. The method a gold-mining company chooses depends upon the size, location, geological model and metallurgy of the deposit in question.

What is the production cost of gold?

The cost of producing gold varies from one miner to the next, and is reported as the all-in sustaining cost (AISC). AISC was first introduced in 2013 by the World Gold Council. Deposit type, energy costs and inflation are the factors that have the largest impact on AISC. The average AISC for the entire gold industry is calculated by averaging the production costs of the largest gold producers. The average AISC fluctuates with changes in energy costs and inflation.

Which nation is the largest owner of gold?

The country with the largest central bank gold reserves is the US, which had 8,133.5 metric tons as of May 2024. Most US central bank gold is held in deep storage in Denver, Fort Knox and West Point.

Securities Disclosure: I, Dean Belder, currently hold no direct investment interest in any company mentioned in this article.

This post appeared first on investingnews.com

A missile fired from Lebanon was intercepted near Israel’s economic center Tel Aviv on Wednesday, Israel’s military said, in a rare attack far from the front lines of the conflict with Hezbollah.

“Following the sirens that sounded in the Tel Aviv and Netanya areas, one surface-to-surface missile was identified crossing from Lebanon and was intercepted by the IDF Aerial Defense Array,” the Israeli military said.

There were no immediate reports of damage or casualties.

Since the outbreak of conflict between Israel and Hamas last October, Iran-backed militant group Hezbollah has fired hundreds of rockets and drones from Lebanon targeting northern Israel.

The missile intercept comes days after Israeli strikes targeting the militant group killed more than 500 people across Lebanon. Monday was the deadliest day in Lebanon in nearly two decades.

Hezbollah has not yet commented on the attempted attack on Tel Aviv.

Flights at Tel Aviv’s Ben Gurion airport continued as usual, the airport’s spokesperson said.

Sirens were heard Wednesday in the central city of Netanya for the first time since October 7, 2023, according to Israeli authorities.

This is a developing story and will be updated.

This post appeared first on cnn.com

Money is often tight for university students, but for Chinazom Arinze, a limited income was an opportunity that sparked a business venture.

While studying law at Babcock University, in Nigeria, and working part-time at a car dealership, she set up a side hustle, informally launching AutoGirl in 2019. Initially also a car dealership, it evolved into a platform that connects people looking to rent out their vehicles with people who want to hire them.

“I think I was about 19 or 20 at the time,” Arinze recalls. “I was just doing it because it was fun, and it did bring some money, but then it grew a lot larger than I expected. I started getting consistent customers.

“I started my business with zero money; the only thing that I had leverage upon was connections. I used my network from the car dealership I worked in, and social media.”

Arinze says she knew car owners who wanted to monetize their vehicles and knew she could match them with people looking for short-term hires, especially tourists. While there are established car rental companies in Nigeria, such as Hertz and Budget, Autogirl’s vehicles come with drivers, and Arinze says her company offers a greater range of cars and “competitive prices.”

One of the cheapest rentals on Autogirl’s website at the time of writing was a Hyundai, priced at 45,000 naira ($27) per day, and one of the most luxurious was a 2018 Lexus, costing approximately 2.85 million Naira ($1,722) per day. The company lists the average income for its vehicle owners as 7 million naira ($4,230) per car.

As her side hustle grew into a thriving business, Arinze realized she couldn’t do things alone.

“For a good few years, it was just me. I was the secretary, I was the social media manager, I was everything … I was working around the clock,” says Arinze, now aged 26. “The only time I wasn’t working was when I was sleeping and even then, if a customer had an issue at night, I was the only person, so I’d be the one they would call and I’d have to resolve it.

“I had to start bringing people on. I brought (on) a social media manager, an admin manager, finance people and an operations team that works 24/7.”

Now, with more than 3,000 customers, and more than 12,000 rides under its belt, Autogirl also offers boat and even private jet rentals through its website. This June, the company expanded into Ghana and plans to launch in Benin later this year.

Empowering women

Arinze concedes that it hasn’t always been easy for her to work in a male-dominated industry. She says she took classes in auto mechanics and produced social media reviews of cars to demonstrate that she knew what she was doing: “I showed them I had knowledge and then people would say, ‘Oh, she’s not a clueless young girl.’”

To encourage other women to follow her path, Arinze recently launched the Autogirl Women Empowerment Programme, which offers free classes in driving, mechanics and affiliate marketing, and hopes to also provide internship opportunities. Arinze says they plan to train 60 women before the end of November.

Ultimately, she sees Autogirl expanding elsewhere in Africa, and eventually beyond. ‘‘We want to be the Airbnb of vehicle rentals in Africa and ultimately the world,” Arinze says.

“The way people thought that Airbnb did not have a chance because there are hotels all over the world is how people think about us and traditional car rentals — but people pay for more flexibility and variety and that’s what we offer.”

This post appeared first on cnn.com

After nearly a year of fighting in Gaza, Israel is ramping up hostilities with Hezbollah in Lebanon, with covert operations targeting communications devices and a ferocious bombing campaign that has left hundreds dead.

The fight against Hamas has strained the Israeli military, with soldiers receiving little respite, officials citing army shortages, the economy facing its steepest decline in years, and growing public pressure for a ceasefire and a hostage deal.

It is unclear whether Israel intends – or will feel compelled – to launch a ground invasion into Lebanon. But the question looms: Can the country take on a second front?

Since October 8, the day after Hamas’ deadly attack on Israel, there has been regular cross-border fire between Hezbollah and the Israeli military. Hezbollah first fired at Israel to protest the war in Gaza, demanding a ceasefire there as a condition to end its attacks.

The stakes were raised last week when Israel injured thousands of people across Lebanon, detonating pagers and walkie-talkies used by Hezbollah. Escalating exchanges of fire have followed.

Should Israel enter full-scale war with Hezbollah, experts say it will face a much stronger threat than Hamas – and commensurate costs.

Over the weekend, the group launched one of its deepest strikes into Israel, with the Israeli military reporting impacts in Kiryat Bialik, Tsur Shalom and Moreshet near the port city of Haifa, around 40 km (25 miles) south of the border.

The cross-border exchange over the past year has already led to more than 62,000 residents being evacuated from their homes in Israel’s north, and the deaths of 26 Israeli civilians and 22 soldiers and reservists, according to Israeli media. Ahead of the weekend’s escalation, over 94,000 had been displaced and more than 740 killed on the Lebanese side, including some 500 Hezbollah fighters, according to Reuters. Israeli strikes since Monday alone have killed at least another 558 people and led to the displacement of 16,500, according to Lebanese authorities.

Here are some of Israel’s main challenges in a potential wider conflict with Hezbollah:

A stronger enemy

Iran’s closest regional partner, the Shiite Islamist group has not only showcased more sophisticated weaponry over the past year, but it also boasts strategic depth through its allies and partners across the Middle East – including in Iraq and Yemen.

While Israel’s military capabilities have improved since its last war in Lebanon in 2006 – when the Jewish state did not yet have its Iron Dome defense system – so has Hezbollah’s arsenal.

Military analysts estimate Hezbollah to have between 30,000 and 50,000 troops, but earlier this year its leader Hassan Nasrallah claimed it has more than 100,000 fighters and reservists. The group is also believed to possess between 120,000 and 200,000 rockets and missiles.

Its biggest military asset is the long-range ballistic missile, of which it is estimated to have thousands, including 1,500 precision missiles with ranges of 250–300 kilometers (155–186 miles).

During the weekend attack, Hezbollah said it targeted Israel’s Ramat David airbase with Fadi 1 and Fadi 2 missiles, longer-range weapons that are believed to have been used for the first time. The base is some 30 miles from the Lebanese border.

The Israeli military did not respond to queries about whether the base was impacted. Israeli emergency services reported that three people were wounded in the attacks.

⁠Behnam Ben Taleblu, a senior fellow at the Foundation for Defense of Democracies (FDD) think tank in Washington DC who focuses on Iran and its proxies, said that the “warhead weight of these projectiles is reminiscent of the heavy Burkan IRAM (improved rocket assisted munition) first introduced last winter against Israel by Hezbollah, but at considerably longer range.”

Orna Mizrahi, a Hezbollah expert at INSS said that much of Israel’s ability to fight a two-front war rests on US support.

“The IDF (Israel Defense Forces) can fight both fronts for a long time, and we have the capabilities to do it if we have the ammunition from the Americans,” Mizrahi said, adding that if there is a full-scale war, the US will likely intervene to support Israel.

Israel also has a huge intelligence advantage, most notably seen in last week’s audacious attacks on Hezbollah’s communications.

Stretched military

Israel is a small state and its military manpower is not limitless. As it gears up for a possible second war, the IDF is diverting some of its key divisions from Gaza to its northern border.

“When you are fighting more than one front, you cannot invest too much in every front,” Mizrahi said. “So it will be a different way of fighting.”

Israeli Defense Minister Yoav Gallant last week said that “the center of gravity is moving north,” and that “forces, resources, energy” are now being moved.

Among those units is Israel’s elite 98th Division. Also known as Utzbat HaEsh, this paratrooper division is believed to consist of 10,000 to 20,000 troops, according to Israeli media.

Guzansky said that diverting resources toward Lebanon does not mean the Gaza war is over, but that Netanyahu feels compelled to deal with the northern front amid mounting domestic pressure to facilitate the return of evacuees from the area.

Analysts and army officials cited in Israeli media have also repeatedly said the IDF is suffering from shortages.

At the outset of the war with Hamas, the military recruited about 295,000 reservists in an effort to boost its manpower. But that number is proving insufficient.

The fighting in Gaza and elsewhere has also taken its toll on soldiers, of whom 715 have so far been killed since October 7, including in the north.

“This is the longest (war) of its kind in Israel’s history, longer than the War of Independence in 1948,” Guzansky said, adding that this is Hezbollah and Iran’s goal, “to weaken Israel gradually.”

“To fire rockets every day, on a low scale, and to occupy the IDF, to overstretch the IDF,” he said.

An economy in decline

Israel’s economy has been one of the biggest casualties of the war in Gaza, taking a sharp blow from the early days of the October 7 attack. Thousands of businesses suffered as reservists abandoned their civilian lives to take up arms, and the country’s economy is shrinking at an alarming rate.

“It’s devastating on the Israeli economy, on Israeli society,” Guzansky said, adding that the impacts will live on for years to come.

Of all 38 nations in the Organization for Economic Cooperation and Development (OECD), Israel showed the sharpest economic slowdown between April and June of this year, the organization said in its quarterly report.

According to OECD data, Israel’s economy shrank by 4.1% in the early months of the war, and continued to contract, albeit at a slower rate, throughout the first and second quarters of 2024.

The contracting economy comes as Israel’s military spending skyrockets. Earlier this year, Amir Yaron, the governor of Israel’s central bank, warned that the war is expected to cost Israel up to 253 billion Israeli shekels ($67 billion) between 2023 and 2025, Israeli media reported. That’s almost 13% of Israel’s GDP, in addition to regular military expenditure, which has stood at an annual 4.5% to 6.5% of GDP, according to World Bank data.

An expansion of the conflict has also impacted Israel’s credit rating, making it more expensive to take on debt, with multiple rating agencies downgrading the country since the war began.

In a statement last month, credit ratings agency Moody’s warned that an all-out war with Hezbollah or Iran could have significant “credit consequences for Israeli debt issuers.”

A legitimacy crisis

A second front, especially one that could be far more damaging to Lebanon than to Israel, could be the final straw for many countries already critical of Israel’s war in Gaza, experts said.

The global sympathy that Israel received in the immediate aftermath of the October 7 attack has turned into sharp criticism due to Israel’s devastating reaction, as it now faces accusations of war crimes and genocide in international courts, which it strongly denies.

Domestically, while Israelis showed a greater appetite for fighting at the outset of the Gaza war, polls show that domestic support has waned over the last months.

On support for a war with Hezbollah, Israelis appear split on the matter.

A survey published by the Israel Democracy Institute think tank in July found that 42% of Israelis think their country should pursue a diplomatic agreement with Hezbollah, despite the chances of an additional conflict in the future, while 38% think Israel should pursue a military victory against the group, even at the cost of significant damage to civilian areas.

Despite the split in opinion, there is now less support for war with Hezbollah compared to responses in late 2023, the poll said.

Guzansky said that pressure for war is likely more palpable in northern Israel, where “people that don’t have businesses anymore, families (are) broken apart… people (are) being killed.”

Many of these residents, who have lived close to the frontline for nearly a year, believe that “only a full-scale war can change the reality in the north,” he added.

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Three months after a historic election victory, it felt like the downpour at the Labour Party’s conference would never end.

Lawmakers and officials in Britain’s new governing party have been trudging through a massive conference center in Liverpool, northwest England since Sunday in sodden suits, a rumbling River Mersey as their backdrop, for the group’s first set-piece event as a governing party in 15 years.

It was supposed to feel like a celebration. Prime Minister Keir Starmer touted July’s gigantic electoral landslide in his keynote speech on Tuesday, telling his party: “People said we couldn’t do it, but we did.”

But the gathering was dampened by more than the weather. Like Britain’s rather fickle summer, Starmer’s honeymoon is a distant memory.

A string of negative stories – about ministers accepting gifts and handouts, and reported conflict within Starmer’s top team – has clashed uncomfortably with a set of joyless policy decisions aimed at stabilizing Britain’s strapped finances, many of which go further and deeper than some inside the party expected when they promised a platform of change during the summer election campaign.

It means Britain’s new prime minister is already deeply unpopular with the public, according to a batch of unflattering opinion polls that landed with a thud as Labour’s conference began.

And while his lawmakers are broadly behind his disciplined agenda, questions are percolating there too about his political judgment and ability to keep his government on message.

“It has felt a bit blunt,” a Labour Member of Parliament admitted after Starmer’s speech Tuesday, summing up the sentiment across much of conference. “It should have been more exciting,” a longtime Labour activist complained.

Starmer dangled a sliver of optimism in his speech Tuesday – promising the country “light at the end of this tunnel” – and in an effort to underline the rare display of cheer, the sun did finally emerge outside a short while later.

The speech was an important hurdle for Starmer, who needed to reclaim the reputation for focus, diligence and honesty that he spent four years building, only to see seriously fractured in three months.

But he nonetheless begins the unenviable mission of boosting Britain’s limp economic growth, and reviving its tired public services, with a fragile coalition of public support.

Starmer has insisted the latter issue will need a decade to truly fix. Unfortunately, the realities of governing are beginning to bite the Labour Party – and it is likely he will need to show some returns far sooner.

A ‘freebie’ row

Labour’s conference was trailed by a series of stories that felt uncomfortably similar to the sleaze scandals that dogged previous Conservative administrations.

Public records showed that Starmer had accepted tens of thousands of pounds in gifts from a key financial donor, including money for clothes and glasses. He had also watched his Arsenal soccer team from a hospitality box and accepted four tickets to Taylor Swift’s Eras Tour concert at Wembley Stadium, worth £4,000 ($5,300).

The donations are not unique for British leaders. But they were particularly surprising – and damaging – for a prime minister who spent four years painting himself as an antidote to the cronyism and coziness with donors displayed by consecutive Tory prime ministers.

No rules have been broken by Starmer or his team, but little common sense has been displayed either, and his lawmakers have noticed.

Maskell said the decision to take gifts and donations showed “poor political and personal judgment.” She is one of few Labour MPs to publicly criticize the front bench but said she is “not alone” among parliamentary colleagues – the group that can ultimately decide Starmer’s fate were a movement to emerge against him.

The donations row was handled badly – Starmer naively fronted a reception celebrating London Fashion Week just hours after news emerged that a donor had bought his wife clothes – but it was especially harmful because it coincided awkwardly with a cut to the Winter Fuel Payment, an allowance given to retirees, to help with utilities bills.

The move to limit that benefit to those already in receipt of state support was opposed by dozens of Labour MPs, and was controversial in a country still dragging itself through a lingering cost of living crisis.

Maskell said she had been “sickened” by the timing. “People are hearing that (ministers) are getting donated clothes, and yet they haven’t got warmth themselves,” she said.

The “one rule for them, another for everyone else” slogan that Starmer attached to Boris Johnson’s premiership became the sentiment that, above any other, caused that Conservative leader – himself fresh off a landslide election win – to be dumped from office two years ago.

Starmer will be desperate to stop it from infecting his premiership too. He told conference attendees Tuesday that rebuilding the country would be “tough in the short-term,” but “we’re all in it together” – and that framing will likely be recycled in the coming weeks as he seeks to restore a reputation for integrity that was so valuable in July.

Patience wears thin

Far beyond the heavily secured gates of Labour’s conference, the country is casting its judgment as well.

The combination of Labour’s miserabilist message on public finances with the costly scandal over its own donations has contributed to an astonishing collapse in Starmer’s popularity since his election win. An opinion poll published by Opinium on Sunday found his net approval rating had dropped to the same depths as Rishi Sunak, the former Tory prime minister that Starmer routed at the ballot box 12 weeks ago.

He pointed to a sparsely detailed economic agenda, adding: “The PM and chancellor have labored on the tough decisions, but given us relatively limited information about what those will look like. The almost sole focus on Winter Fuel Payments has made the government look like it’s unfair and out of touch.”

And they have already been forced to lighten their tone, after the barrage of gloom threatened to undermine confidence in Britain’s economy. Reeves, in her keynote speech on Monday, told attendees that “Britain’s best days lie ahead,” a useful pick-me-up after months weeks of somber addresses that blamed the previous Conservative governments for mismanaging public services and for a financial “black hole” that Labour said it discovered after taking office,but failed to hit a hopeful tone for the years ahead.

More painful measures are expected when Chancellor Rachel Reeves outlines the government’s budget next month. Starmer and Reeves have styled themselves as tough, frugal guardians of the public purse, but they are facing pressure to improve their financial offer for Britain’s public services, including a National Health Service (NHS) that was described in a damning review this month as being in “critical condition.”

In a helpfully timed piece of good news, the Organisation for Economic Co-operation and Development said Wednesday that it now expects Britain to log faster economic growth than the eurozone this year, predicting an expansion of 1.1%.

Starmer, who left Liverpool for the United Nations General Assembly in New York, will consider the week a relative success; the party managed to refocus the political narrative on its core message after leaks and missteps threw it off course. Starmer’s speech was was light on fresh content but a heckler was calmly removed and the key messages were confidently delivered.

But a premiership can only survive on doom and gloom for so long, and patience is already wearing thin among much of the wider party.

An MP whose surprise victory in July’s election was illustrative of Labour’s huge success in virtually every pocket of the country was already thinking about what they could run on in five years’ time. “It’s all very well saying it will take a decade,” they said. “But where are the tangibles?”

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