Saturday, January 28, 2012

The Report That Will Blow Up The Eurozone

Jack Delano Hot Sugar January 1942
Guanica, Puerto Rico. "Burning a sugar cane field. This process destroys the leaves and makes the cane easier to harvest"

Ilargi: No, I’m not talking about the fact that Germany and Holland want to take over as the de facto government in Greece, as Noah Barkin writes for Reuters (that they want to do it through Brussels is a mere technicality).

Germany wants Greece to give up budget control
Germany is pushing for Greece to relinquish control over its budget policy to European institutions as part of discussions over a second rescue package, a European source told Reuters on Friday.

"There are internal discussions within the Euro group and proposals, one of which comes from Germany, on how to constructively treat country aid programs that are continuously off track, whether this can simply be ignored or whether we say that's enough," the source said.

The source added that under the proposals European institutions already operating in Greece should be given "certain decision-making powers" over fiscal policy. "This could be carried out even more stringently through external expertise," the source said.

The Financial Times said it had obtained a copy of the proposal showing Germany wants a new euro zone "budget commissioner" to have the power to veto budget decisions taken by the Greek government if they are not in line with targets set by international lenders.

"Given the disappointing compliance so far, Greece has to accept shifting budgetary sovereignty to the European level for a certain period of time," the document said. Under the German plan, Athens would only be allowed to carry out normal state spending after servicing its debt, the FT said.

Ilargi: Nor do I mean the report from the Kiel Institute for the World Economy that Ambrose Evans-Pritchard cites for the Telegraph, and which implies a second bailout for Portugal is looming near:

Investors fear mounting losses in Portugal as second rescue looms
Portugal is fighting a losing battle to contain its public debt and may be forced to impose haircuts of up to 50pc on private creditors, according to a top German institute.

A report for the Kiel Institute for the World Economy said Portugal would have to run a primary budget surplus of over 11pc of GDP a year to prevent debt dynamics spiralling out of control, even in a benign scenario of 2pc annual growth.

"Portugal's debt is unsustainable. That is the only possible conclusion," said David Bencek, the co-author, warning that no country can achieve a primary budget surplus above 5pc for long. "We won't know what the trigger will be but once there is a decision on Greece people are going to start looking closely and realise that Portugal is the same position as Greece was a year ago."

Yields on Portugal's five-year bonds surged on Thursday to a record 18.9pc, reflecting fears that the country will need a second rescue from the EU-ECB-IMF Troika. Three-year yields hit 21pc.

Ilargi: Or even the true meaning behind the steep drop in the Baltic Dry Index, on which Sebastian Walsh reports for Financial News:

Chart of the Day: The Baltic Dry Index
Statistics from the Office of National Statistics this morning showed that the UK went into reverse in the last quarter of 2011, when the economy shrank by 0.2% – but as the Baltic Dry Index shows, the global economy is looking even more worrying.

The index – often used as a proxy for the health of the global economy as it reflects the prices charged for shipping commodities such as metals, coal or grain around the world – has fallen by 61% since October. The index was at 842 at yesterday’s close – down from its 12-month high of 2173 last October.

Nick Bullman, managing partner at risk consultant Check Risks, said the index is a good way of looking at the risks to the global economy, "as it tends to be where they hit first".

According to Bullman, its initial collapse in October was driven primarily by a fall-off in demand from China, where declining housing prices pushed purchasing managers to cut back on orders for the raw materials whose transport the Baltic Dry Index reflects.

He said: "This collapse looks similar to the falls we saw in the Baltic Dry ahead of the recessions of the late 1970s and early 1990s – but this drop is actually steeper."

Bullman added that it was also a more direct indicator of global economic health than government-produced statistics. "Personally, I’m not interested in employment data and GDP figures because they’re manipulated," he said. [..]

Bullman said that shipping companies have also been deliberately slowing down their journeys to save fuel, with trips from China to the US going now taking around 50% longer than they were early in 2011.

Instead, he said he was surprised by how long the Baltic Dry took to fall. The NewContex index – an indicator of prices for transporting products in container ships – started falling in April last year. Bullman said: "When we saw that happening in April, we realised that risks had returned to pre-2008 levels. We thought the Baltic Dry would start falling too, but it was actually relatively resilient."

"What this is signalling is that the world economy is slowing down much more quickly than people have been thinking."

Ilargi: The report I refer to in the title requires a little background info:

In Holland, where I'll be for a few more days, there's a "rogue" right-wing party named PVV (Party for Freedom). It has no cabinet ministers, but the minority moderate right-wing government needs its support to stay in the saddle. The PVV, like other European right-wingers, is, among many other things, against much of what the European Union stands for. It's certainly against the Euro, and the bailouts with Dutch taxpayer money of countries like Greece and Portugal.

A few months ago, the PVV announced they had commissioned a report from British financial consultancy firm Lombard Street Research on the economic consequences of staying in the Eurozone versus returning to the guilder.

That report is about to be published "within days". It will prove to be highly explosive material. And the PVV will do all it possibly can to make sure it receives a lot of media attention. It may tear down the incumbent government, which is a heavy advocate of all things Europe, and which will have to quit once the PVV support dies, but for that party that's not the no. 1 concern.

And if and when Holland has a large scale discussion on the report and the issues it raises, Germany won't be able to ignore it and stay behind. And then, neither will France.

Max Julius of did a piece on the report, without mentioning it directly, 10 days ago:

Why Germans and Dutch will exit 'suicide pact' eurozone
Germany and the Netherlands are likely to quit the eurozone rather than swallow an indefinite number of 'unrequited transfers' to the union’s crisis-stricken nations, according to Charles Dumas, chief economist at Lombard Street Research.

Speaking at an event in central London, he said that before joining the single currency, German incomes had stayed level but their purchasing power had increased as the Deutschmark appreciated. With the weaker euro, the economist said, they have seen 'tremendous' wage restraint, leading to huge growth in German firms’ market share but ‘no serious growth of the economy’ and a squeeze on disposable incomes. Meanwhile, consumption rose elsewhere in the eurozone, he said.

'So what you’re actually dealing with here... is a German population which has had a rotten deal – and that’s why they’re all so angry' noted Dumas, who is also chairman of the macroeconomic forecasting consultancy. Branding the monetary union a 'suicide pact', he continued: 'So what this exercise in uniting Europe has achieved is to divide Europe.'

Dumas [noted that] the 'Club Med' nations needed about 5% of gross domestic product in annual debt refinancing 'more or less indefinitely'.

This would amount to €150 billion a year, of which Germany would have to stump up just over €60 billion, France a little under €50 billion and €15 billion from the Netherlands, he said. And this would be on top of the shortfall in consumer spending, in addition to the fact that wages and consumption may have to be held down in the future, Dumas warned.

Ilargi: This morning, Dutch daily Algemeen Dagblad cited Dumas as saying these numbers are "cautious estimates". They are valid only if Greece and Portugal would leave the Eurozone in 2012 - which Dumas expects will happen -. If they don't, the payments will be even higher.

He predicts the costs of a return to the guilder will be much less than for instance the Dutch government's Central Planning Bureau claims, which warns of huge losses if Holland were to leave the Euro.

Dumas: "It's just like in a religion: first they promise you heaven, and if that doesn't work out, they threaten you with hell."

The economist dismissed the notion that the region would be able to turn itself around so as to make such support from its 'core' unnecessary. Citing the example of the persisting transfers from west to east Germany, he pointed out: 'The ones that need the money to flow in carry on needing the money to flow in, or just stay poor.'

Dumas also warned that austerity was only worsening Greece’s budget deficit, and that it was 'difficult to imagine' the deeply indebted state receiving the four quarterly batches of financing it is due this year. ‘It’s almost impossible to imagine people continuing to stump up the money, because they simply have not actually gone into this thing with the intention of unrequited transfers to Greece ad infinitum,’ he said as the country resumed talks with its creditors over a planned debt swap.

Calling the one-off damage of splitting up the eurozone 'seriously exaggerated', Dumas warned that as the crisis deepens, he believes 'Germany and the Netherlands will actually realise that they had better call it a day and jump out.'

Ilargi: Sure, the Dutch government, and certainly the EU and the banking system, have formidable PR machineries at their disposal. We’ll see a lot of numbers being floated that contradict Lombard's report. And we'll have to wait a few days to see exactly what numbers Dumas et al. come up with.

But the people of Germany and Holland are already very nervous about the fact that they face austerity and budget cuts while billions of euros are transferred to southern Europe. Up until now, the fear of economic disaster predicted in unison by government leaders have kept them quiet. Now that a reputable economic research firm flatly contradicts these predictions, and states that, instead, it's staying within the Eurozone that will be the far more costly option, the people will grow increasingly restless.

Charles Dumas again, from Algemeen Dagblad:
"The Dutch people have lost thousands of euros in purchasing power per year since the currency was introduced."

Governments in Berlin and The Hague will have a lot of explaining to do. They have to do so against a backdrop of (near-)failing Greek debt swap talks, which will at the very least force them to admit that they have a lost tens of billions in taxpayer money to Club Med countries already.

With a second Portugal bailout waiting in the wings. And lots of negative news on Italy and Spain. And more domestic budget cuts.

They’ll realize that their governments have painted far too rosy pictures about the issues so far. And they’ll expect them to deliver more of the same. This is what we call a receding trust horizon.

It's not the report alone, it's the entire combination of factors. The report will "merely" serve as the catalyst that blows up the powder keg. It may take a few months, but it will happen. The publicity hungry rogue PVV party that commissioned it, followed by anti-Eurozone voices elsewhere, will make sure of that.

Here's another interview with Nicole, conducted by Nicholas Bawtree for Italian magazine Terra Nuova, October 2011 in Florence, Italy.

Partial transcript (thanks to John Rubino at

When you have economic contraction you also have a substantial contraction of the trust horizon. This deprives political institutions at the national and international level of the trust that would give them political legitimacy. They become stranded assets from a trust perspective. People no longer internalize the rules that those institutions are attempting to impose. The response is typically surveillance, coercion, and repression. This picture basically suggests that it is pointless to look for solutions from the top down. It is not solutions that will come from the top down but more problems.

So politicians typically make a bad situation worse as expensively as possible. The systems that we have established have become sclerotic and unresponsive, hostage to vested interests with no ability to adapt quickly to give people abilities to cope with rapid change. I don’t look for solutions from them. The people who are part of that system are typically the people who have gained significant amounts from the status quo. These are the last people who are likely to change things, so I don’t look for political actions.

In many parts of the world, especially in parts of Europe, people always ask me if they should take political action, change their policies at a national level to solve these problems. And I tell them unfortunately not because there isn’t any mechanism for these large bureaucratic institutions to offer anything that would realistically help, and that they‘re far more likely to try to maintain their own existence by sucking even more resources out of the periphery in order to maintain the center.

This is a bit like when a body becomes hypothermic, not enough heat. It shuts off circulation to the fingers and toes in order to preserve the body temperature of the core. That’s what we can expect politicians and political systems to do. Unfortunately for us, we are the fingers and toes and we have to look after ourselves. Nothing is coming from the top.

My solutions, such as they are, are grassroots solutions. We have to build things from the bottom up. Our centralized life support systems will fail over time because they’re critically dependent on tax revenues that won’t be there and cheap energy that won’t be there. These centralized systems won’t be able to deliver the goods and services we’ve come to rely on.

What we need are alternatives that come from the bottom up. The reason these work is because they operate within the trust horizon. They don’t have to stay small. They can grow to whatever size the trust supports and that can be different in different places. The crucial thing is that they come from the bottom up, they’re small and responsive and not bureaucratic, they make the best use of very small amounts of resources because they don’t have enormous administrative overhead.

It’s amazing what can be done at a very small scale. It wouldn’t replace what the centralized services have given us, but we can cover the basics. The key point is that we have to do it right now because we don’t have much time before we start to see centralized systems failing to deliver what they have delivered in the past. The amount of money in the system can contract very quickly. That undercuts what these centralized systems are capable of delivering in the next few years. So we must start right now building grass roots initiatives, and community is crucial to that.

We need to begin at the individual level because if we are on a solid foundation ourselves we can then help others. If we are not then our attempt to help others is fundamentally weakened. So we have to get our own house in order but then we have to think much more broadly. We must build community. Relationships of trust are the foundation of society. So we need to work with our neighbors, we need to know our neighbors and we need connections with family and community so we’re less dependent on money.

In many parts of the world where people really don’t have any money anyway, their society functions on barter and gifts, working together, exchanging skills. This works as a model. It doesn’t get you a large fancy sophisticated industrial society because it doesn’t scale up that well. But it works very well at a small scale, and this is the kind of structure that we need to rebuild.

In some parts of the world there’s a lot more of that than in other parts. So it’s actually interesting to think that it’s not necessarily the places that are the wealthiest at the moment that will do best in the future.

The analogy I use is that if you’re going to fall out of a window how much it hurts when you hit the ground depends on how many floors up you were at the time. If you were on the hundredth floor and you do nothing to prepare before you fall it’s going to be fatal. If you’re much further down it’s less painful. If you fell out of a ground floor window you might not even notice. You just pick yourself up, dust yourself off and not very much has changed.

So the places that will do best are the places where there is already a lot of trust at the foundational level, where people are used to working together, where people are not that far removed from the land. Places where there’s an enormous disconnect between resources that are available in that area and what resources that are actually used, where societies are highly atomized and used to a very high standard of living, those places will see enormous shock to the system because those people don’t have any skills or connection to land or family to fall back on.


Ash said...

Shaping up to be quite a week ahead of us.

First, Merkel proves yet again that she knows exactly how to make those Greek people happy - by formally requesting they enshrine the concept of debt slavery into their Constitution.

Then, we have the announcement by Ilargi that a well overdue report on the outlandish costs to the core of maintaining the EZ will be released soon (not to speak of the costs to the periphery - see above).

Lastly, a simple tweet.

"Foreign Office sources say Merkel now thinks Greece will default."

It's safe to say that the time it took them to officially admit this for Greece will be much longer than the time it takes for Portugal.

Herbal Floyd said...

Market collapse in 2nd quarter 2013. Here's why and here's what needs to be done:

Step #1)
Dramatically scale-back social security payments (SS) though means testing and elevated age requirements.

Step #2)
Replace SS with mandated stock investments that cannot be withdrawan until retirement--an event with preordained receding horizon.

Step #3)
Prevent early withdrawal from existing tax-sheltered retirement funds (IRA, 401K, etc.) until minimum age requirement met (apply receding horizon to age requirement).

Step #4)
Steps 1-3 are facilitated by glowing coverage of further European agreements -- newly elected Social Democrats and Greens in Germany along with Francois Hollande and the Socialists in France support ECB intervention etc.

Glow and afterglow of Facebook IPO....and further web 3.0 companies.

New all time market high solidifies faith in stocks.

That's what's needed to comprehensively toss the hot potato to the little guy, and that can't happen until 1st 100 days or so of 2013. That and a tax-funded mortgage principle writedown for everyone underwater and current.

Then and last but not least,
Let the chips fall where the may and lock the gates to the community.

seychelles said...

Last words about TD

If you have successfully put in place the new login procedure for your account, the main way you can get "locked out" in the near term is to make two mistakes while logging in. Then you get a default message that says "Contact our security division at such and such phone #." But at this number you may only be able to leave a message and they may not phone you back for a long time. Moral: don't log in to TD until after your first two cups of coffee and as the snuff would say be careful.

Also, if you want to transfer from your local account, the maximum you can transfer at one time into CofI is $1000. Once purchased securities mature, you can direct as much of the proceeds as you want into CofI.

Jack said...

Hi el gallinazo
About Russia getting involved in any conflict that may happen in Iran.
It seems likely that Armenia will invade all of Azerbaijan for the oil reserves.
Armenia was in Baku in the war that happened 20 years ago but pulled back for political reasons but I think this time around they will stay in Baku and tell everyone that opposes them to mind their own business.

Greenpa said...

did it again; posted to the old thread... so forgive the dupe:

Hi all; still struggling to find minutes to spend here, and feeling guilty about not - because in fact the quality of the conversation is pretty high. I'm pooped today, and will be poopeder; yesterday took on the nature of a Congressional Fire Drill, in terms of input vs. productivity; gotta try to make up for it a little today... (I was searching to an alternative term to the now clearly non-PC term "Chinese fire drill", popular in my youth, and Congressional popped quickly into my head.)

very quickly: from Ash: "the pluralism of causes and effects in biological networks is better addressed by observing, through quantitative measures, multiple components simultaneously and by rigorous data integration with mathematical models" Sauer et al[4]"

I should reveal that I have another bias there- I'm pretty anti mathematical models, per se, at this point. Keep in mind their use in Wall Street, and the "quants"; a term now in disuse and disgrace; my own opinion is that their use in biology is frequently not any better than their use in Wall Street. Their potential and propensity for creating disinformation instead of reflections of physical reality is very- VERY high. It's not that models are a bad tool. It's that mathematical models are claymore sized scalpels, and a certain kind of worker loves to swing them around as fast and as often as possible; appropriate or not.

I wrote about this on my blog:

Models are very seductive. The urge to fit data into a model is great, when the model is sitting right there, and you can publish with "the fit is good" - when in fact a billion other sets of data will also "fit" just as well.

So- disclosure- at this point in my intellectual development, the argument "look, it fits this mathematical model pretty well" turns me off; not on. I want a different kind of proof.

Getting cranky in my old age. Hey, it's fun.

Joe in NC said...

Russia to start special military maneuvers

"According to the ministry’s official announcement, this year’s exercise will be held on a larger scale and more in line with the current military and political situation than the one held in 2011. The maneuvers will take place not only in southern Russia, but also in Abkhazia, South Ossetia and Armenia. The Caucasus 2012 SCSE, scheduled for September, is expected to be the most important military event this year. The exercise plans are now being developed, but military experts believe that preparations for the SCSE will include real combat training missions in light of threats by the United States and several other countries against Iran, as well as other potential conflicts in the Caspian and South Caucasus regions."


Greenpa said...

hm; a little obliviot behavior on my part; it dawned on me that the word "claymore" is not exactly in daily use any more; on googling- I got pages of references to Japanese manga. Um; not that.

A claymore is a very large "broadsword"; specifically intended to be wielded using both hands, and capable of shearing through both mail and plate armor. Googling "claymore sword" will get you there.

So, the image I was going for, is a grad student whirling this honking huge nano-sharp sword around the lab- one handed instead of two, and not really in control of where it's going... see? :-)

Ash said...


I agree, mathematical models are by definition a simplification of reality and many are based on horrendous assumptions, such as the various risk models used in the financial world. Then again, we have more realistic and useful examples such as Dr. Keen's debt deflation model, even though it has quite a few shortcomings as well. I think systems theory in general, though, has been a great tool for thinking about (and modeling, in some cases) the reality of the systems that make up our world and our lives.

Ruben said...

Greenpa, a claymore is also an anti-personnel mine.

I am also bringing forward a comment from late in the last post because I am still hoping for feedback--from you Greenpa, if you have time, and from Ash. Thanks for your thoughts Ben.

First off, has everybody looked at Boids? It is functioning on three rules, separation, cohesion and alignment.

My reading of the following makes me think they are saying criticality is something other than rules of the road.

Discriminating between the two scenarios above (very low noise vs. criticality) is difficult....

(it) seems, however, to indicate that some kind of criticality might in fact be present in starling flocks.


For this reason criticality is perhaps a more likely scenario for our results.

I am having a hard time wrapping my brain around the application of criticality here, though I get the sandpile. If a hawk is strafing your flock, it doesn't seem useful to only have your sandpile (flock) avalanche (turn suddenly) only under mysterious conditions of criticality. It seems like you would want the flock to turn every time, and very fast. So, I am having a hard time wrapping my brain around this one.

Let me explain my interest.

While working to facilitate pro-environmental behaviour change, I read the book Herd, which references Boids. I watched Boids and read the three rules. I immediately felt there are similar, though unknown, rules governing behaviour like recycling. But before I go off half-cocked, I like to do a little more research.

The research says there are two main schools of thought. One is rules, like Boids. They see another bird move, and they move in response. Their reflexes may be faster than we can imagine, so maybe this can happen very fast.

The other theory is magic, as Greenpa put it--but let's just call it telepathy instead, Basically birds can flock because they are communicating wirelessly, and so they all move at once. In the absence of evidence to support the existence of telepathy, this is taken seriously because the flocks seem to move with great synchronization.

Am I being fair to that school of thought? I am not trying to be an ass, but that is the meaning behind it, isn't it?

But, I don't see why birds would have developed telepathy to swerve around predators, but wouldn't use it to find where the good food is. Or why they would continue to use noises to warn of predators while on the ground, but would flock in the air.

But going back to rules vs. telepathy. TAE talks about herding a lot. I found the book Herd to be convincing in some aspects--it may just be the sheer number of instances you see that affects consumer choice, not the fancy marketing campaigns.

And ultimately, that herd behaviour--recycling, buying real estate or gold, selling stocks--doesn't care about whether it is rules or telepathy, because the end result is the flock turning. So, I am geeking out a bit here, but I am curious.

Ash said...


"I am having a hard time wrapping my brain around the application of criticality here, though I get the sandpile. If a hawk is strafing your flock, it doesn't seem useful to only have your sandpile (flock) avalanche (turn suddenly) only under mysterious conditions of criticality."

I don't think it's useful to literally compare the critical state of a sandpile to that of a starling flock (assuming it is capable of having one). It may very well be that those types of complex biological systems, which have evolved over millions of years, now reach critical states that allow consistent collective reaction to predators. It is also true that, while we don't know how each additional sand grain will affect the sandpile in a critical state, we do know for sure that avalanches will occur and perhaps even with some regularity.

The herding behavior you reference is no doubt an "emergent property"
of complex adaptive systems, but that is not necessarily the same thing as a critical system. I believe the Boids simulation is a good example of the former. Those advocating the critical systems explanation believe there is an additional layer of "magic" that allows collectives to respond the way they do.

jal said...

Largest Central Banks Now Hold Over 15 Trillion in Fictitious Capital.

For example, this is who backs the tiny $81 billion ECB capital used to lever 2.75 trillion in "assets." 
( Its not capital asset. Its debts that cannot and will not be paid back.)
All the players are playing the same music in the same band. All the players are following the conducteur.

The music will continue until ... the herd of institutional money managers decide to call it quit.


jal said...

I’ve said it before.
Now you have some numbers to work with. $81B and $2.75T. The end game is to let the ECB go bankrupt. Everyone got $2.75T and suffered a loss of only $81B.

Small haircut. Small investment.
Repeat with a “new ECB”.

el gallinazo said...


"In Holland, where I'll be for a few more days, there's a "rogue" right-wing party named PVV (Party for Freedom)."

When the politics of the "centrist moderates" is pushing a neo-feudal oligarchy, run by technocrat minion gangsters of the fabulously wealthy, it's kind of hard to figure what right-wing means.


"Their reflexes may be faster than we can imagine, so maybe this can happen very fast. "

Reflexes are determined by the maximum speed of an efferent myelinated axon voltage impulse traveling toward either a ganglion in the spianl cord or to the brain. I would think that all reflexes but the most crude require brain interaction prior to an afferent impulse to the muscles. This all limits the speed of the reflex. If it is faster than we can imagine, something weird is going on.

Speaking of this type of weird, I was a big fan of Alex, the late, great African Gray parrot. He was the research subject and also the best friend of Professor Irene Pepperberg. He died prematurely recently, and Dr. Pepperberg wrote a book about their relationship together over 25 years, fittingly titled Alex and Me. In the book, Pepperberg makes a strong case that Alex discovered the zero independently, something that the Greeks never did. I recommend the book highly. What intrigues me most about Alex's story is that he had a brain about the size of a walnut, maybe 50 ml. The average size of the human brain is about 1300 ml. Conventional neuro wisdom has it that once the physical size of a creature and motor connections are factored out, cognitive ability is a function of brain size. Alex violates this rule.

Jim R said...

El G,
It's not the SIZE of the brain, but its complexity. Lots of tiny neurons with many branches and synapses?

I suspect that Alex had lots and lots of interconnections. Moreso than the average African Grey, because he had been to grad school..

Wyote said...

About the Baltic dry Index, is this fall due to a decrease in exports or like in 2008, or is credit erosion behind it? Or both?

Remember this from in October 2008:
Baltic Dry Index Falls Nearly 20% in Two Days
The Baltic Dry Index, which some use as a proxy for the outlook for global manufacturing, has been falling since late June, not long before the commodities bubble burst in July, and has been in retreat since then. What is particularly worrisome is its steep dive in the last two days, despite Herculean efforts to get the banking system operational.

The Guardian article suggests that the culprit may be a rapid deterioration in the Chinese economy, but we are concerned that another factor may be at work that the financing of trade is seriously impaired. in our post “International Trade Seizing Up Due to Credit Crisis,” we cited reports that banks are refusing to honor letters of credit from other banks. If this persists, international trade will break down.

Or is it the result of the Chinese lunar New Year holiday week and the steady scrapping of surplus vessels?

ben said...


"The other theory is magic, as Greenpa put it--but let's just call it telepathy instead, Basically birds can flock because they are communicating wirelessly, and so they all move at once. In the absence of evidence to support the existence of telepathy, this is taken seriously because the flocks seem to move with great synchronization.

Am I being fair to that school of thought? I am not trying to be an ass, but that is the meaning behind it, isn't it?"

even to the proponents of critical flocking i would think it would be a mischaracterization to say that the birds all move at once. clearly they don't do that or they would always remain on the same plane. there would never be any curvature to the flocking. neither would sychronization be the right term, for the same reason.

for obvious reasons they wouldn't say that even in criticality the flock, when attacked by a predator, would respond uniformly.

scandia said...

Thanks for to-day's eassy, Ilargi.
I have been wondering what the costs to leaving the EU are so I, for one, look forward to the Lombard report.
Re Greece it looks like the Greeks are being asked to surrender their " first born ".
What with the sell off of Greek assets what's left?

Joe in NC said...



In general, I think the following information is probably accurate:

Does the Baltic Dry Index Really Indicate Anything?

"Taken by itself, the BDI probably doesn’t give much information about economic prospects. But combined with commodity pricing and available information on new vessels, the BDI does have something to say about the global economic outlook."


Joe in NC said...

BDI cont.

The writer of the following article attributes the BDI decline to excess shipping capacity (and a sharp drop in ship building orders):

Global ship glut fueling Baltic Dry Index plunge

Then this article makes it more complicated (bringing the HARPEX Index into the equation):

The Blame Game: Revisiting “The Most Alarming Chart I’ve Seen All Week”

"Even if we look at the increase in capacity – which is up 12.7% in the last year and 3.9% in the last three months – there’s no way it’s the only factor sinking the Baltic Dry Index."


el gallinazo said...

If Merkozy can do this, there is still hope for the Euro.

As Shakespeare once asked, "What's in a name." We have all heard stories of Dr. Passwater the urologist and Dr. Goldfinger the Ob-Gyn. In the same spirit one may wish to watch former Fed Vice Chairman Alan Blinder on Capital Accounts. Spread some horse excrement on your Sunday morning bagel.

John Day said...

Iranian Parliament meets Sunday, to declare to those double-crossers in the EU, "You can't fire me; I quite!"
The EU bought about 25% of Iran's oil, but a moderate amount of that was in purchase agreements through middlemen. In these, some good or service was provided to Iran, to be paid back over time in oil.
Iran may not have a straight loss of 25% of oil revenue at all.
Iran has also been giving very favorable terms to Greece, at what looks like a loss, so that cessation won't really hurt Iran.
This bold preemptive-reverse-boycott will firm up support for the home team in Iran, as the Mullahs kick-ass instead of just being bullied by the Great Satan again.
India, China, Japan, and South Korea appear to still be on-tap for Iranian oil.
Nobody else seems ready to supply Europe. World oil prices may rise, and the Euro collapse may be sooner and more disorderly than anticipated.
The Hegemony of the $US and global central banking may be challenged by the Shanghai Cooperation Council, gold trades for oil, and the relentless machinations of history.

ben said...

tear gas and flash grenades reported this afternoon as occupy oakland tried to establish a social center at the shuttered convention center. go glennda. 2000 people marching. oakland solidarity march here in pdx tonight at 8.

Glennda said...

Actually it wasn't tear gas, at least in any area I was. They used flash/bang nades and smoke bombs that looked like they might be tear gas. I had a bunch of distilled vinegar I happened to have with me and gave it out to folks who wanted to damp down their scarves. It's a fad now to wear a cotton scarf around one's neck these days for both men and women.

As we walked back from the unsuccessful attempt to enter the closed-for-renovations Oakland Kaiser convention center, the cops were mostly being reasonable like the SF ones last Friday on Occupy the Courts day (protesting that Corporations are not People). They threw flash/bangs and smoke bombs at the convention center and then at a few streets managing to herd the crowd back to DT Oakland. By that time I'd been marching for 3 hours, so a friend and I left the slower moving crowd and headed back to the Plaza.

We'd been walking with the Interfaith banner. The recommendation is to join with an affinity group to support each other.

The only problem with the smoke bombs were that people needed water to wash it off with and clear their lungs. I gave away an extra bottle of water for that purpose.

I can't say I expected to ever move in to the building as it was obvious to me from the start which building it would be and it must have been obvious to the police too. I had promised to not get arrested due to a big work project coming up; I figured I could stay on the periphery which I did for the most part.

Apparently the Oakland police were told by an investigatory judge of some kind to make some internal changes which have not happened. I'm hoping that they might be in danger of being in contempt of court if they over reacted again. This may have kept them more manageable.

So the real action was a march that closed off streets as it wound its way many blocks east and then back around to the plaza again.

I loved seeing the huge grin on the black postman as he walked by us. Many are in sympathy with us.

Oh, my aching feet,I'm so glad to be able to put them up and go online here.

Your onsite news reporter, Glennda.

Glennda said...

By leaving at 4 pm I missed the police action. I figured the police would get more active after dark.

Here is a tweet from the OccupyOakland stream:
protester does a mic check " City Hall has been occupied!" we cheer. We will not b defeated
[apparently the City Hall is getting trashed.]

[By 8 pm city hall was emptied. But rumor is that it has been reoccupied. A stand off.]

And Yes tear gas, and rumor of a bullet hitting a protestor.

One tweet says that about 15 cops got tear gassed when a cannister went the wrong way.

The cops have trapped about 100 at 19th and Telegraph (6 blocks from the plaza) and are arresting all with buses arriving.

One tweet says:
"Where is the TV and NEWS coverage? All but dried up. Government crackdown on media."

Some MSM reporters were reported as being run off by cops. Also report that 5 journalist arrested.

Good coverage seems to be only through:

Glad I left before dark. Don't want to be arrested at this point.

Nassim said...

The supposed ‘consensus’ on man-made global warming is facing an inconvenient challenge after the release of new temperature data showing the planet has not warmed for the past 15 years.

The figures suggest that we could even be heading for a mini ice age to rival the 70-year temperature drop that saw frost fairs held on the Thames in the 17th Century.

Based on readings from more than 30,000 measuring stations, the data was issued last week without fanfare by the Met Office and the University of East Anglia Climatic Research Unit. It confirms that the rising trend in world temperatures ended in 1997.

Meanwhile, leading climate scientists yesterday told The Mail on Sunday that, after emitting unusually high levels of energy throughout the 20th Century, the sun is now heading towards a ‘grand minimum’ in its output, threatening cold summers, bitter winters and a shortening of the season available for growing food.

Solar output goes through 11-year cycles, with high numbers of sunspots seen at their peak.

We are now at what should be the peak of what scientists call ‘Cycle 24’ – which is why last week’s solar storm resulted in sightings of the aurora borealis further south than usual. But sunspot numbers are running at less than half those seen during cycle peaks in the 20th Century.

Forget global warming - it's Cycle 25 we need to worry about (and if NASA scientists are right the Thames will be freezing over again)

Bosuncookie recently linked the following article:

Gardening Map Of Warming U.S. Has Plant Zones Moving North

Personally, I would not build a homestead based on these projections - unless you like believing officialdom.

Nassim said...

"The Dutch people have lost thousands of euros in purchasing power per year since the currency was introduced."

A long while back, thirty years ago, the Far East seemed to be full of German holidaymakers - at a time when few Brits and Aussies seemed to be able to afford to make it there. Places like Thailand were almost "discovered" by German holiday makers and pensioners. The pensioners frequently bought property and settled down with a Thai lady or young man. They were the big-spenders at that time. Ordinary Brits only "discovered" it decades later.

I don't think the Euro was a blessing for the Germans - only for their employers. I spent a lot of time in the Far East at that time - installing American computers for local airlines - and had a good idea of what was going on.

Nassim said...

The largest portfolio of homes in the UK is up for sale, and could be yours for just £3 billion.

Iranian-born tycoon Vincent Tchenguiz is looking to sell the freehold for 250,000 properties, which represents one per cent of the UK's entire housing stock.

The sale has been exclusively targeted at sovereign wealth funds, according to the FT.

Forty per cent of the homes and apartments are in the South East of England, with 15,000 properties alone in London.

Mr Tchenguiz is acting on behalf of the Tchenguiz Family Trust and has spoken to investment bank Lazard to help sell the portfolio, which comes with £2 billion worth of debts.

The great sell-off: Property tycoon to raise £3bn by selling 1% of ALL UK homes to clear his debts

The headline is a bit misleading as he has the freeholds, but these properties are leased out and he only gets the "ground rent" until the end of the lease when he fully takes control. Nevertheless, debt and gearing is amazing stuff.

It would be interesting to see whether he will be able to clear his debt - he obviously left it all a bit late.

Quite impressive for someone who was an analyst-programmer in Tehran with yours truly in 1977-9.

Frank said...

Nassim, the USDA hardiness map is not a projection, it is an observation.

They are created/updated based on the rolling previous 30 years of observed weather.

I can only speak for one observation point, but right here on my rocky New Hampshire hillside, warming did not stop in 1997, but has continued right on through yesterday afternoon.

Joe in NC said...

John Day,

Interesting comment - I enjoyed reading it.

Does anyone have a guess as to how much of a "thorn in the side" the Shanghai Cooperation Council is to TPTB?


Joe in NC said...

China to boost surveillance flights over disputed East China Sea areas

Navy wants commando ‘mothership’ in Middle East

Ash said...

Glennda & others,

Just came across this guy who does a live stream of OccupyOak.

el gallinazo said...

Joe in NC

I believe that an US attempted invasion of Iran is inevitable within the next 18 months though the exact time is being held tightly guarded. It could be quite soon. It has little to nothing to do with Iran's nuclear ambitions or lack of them as did not the invasion of Iraq. It is about oil and currencies. An invasion of Syria as well, though the Syrian regime is less militarily strong and the invasion may be done by proxies with NATO air bombardment as was done in Libya. Syria has a substantial al Qaeda contingent and the CIA can harness this asset as they did in Libya. As to an invasion of Iran, it may just be a bone that gets stuck in the throat, even without direct Russian involvement. Israel will be hit hard by Iranian conventional missiles.

I think that the Iranian ban on export to the EU, which should be effective immediately is sort of funny. Just dopey Hilary et al shooting themselves in the foot. Another toe gone. OTOH, one of the prime goals of the Fed is to trash the dollar, and despite their current lack of success, this may help. If the EU thinks that Russia is going to compensate for the loss of Iranian oil to the EU, I would think that they should not hold their breath. Maybe France should start to manufacture those little mopeds with the engine over the front tire, so popular in the 1960's.

re Murmurations and JHK's previous post, mainly dealing with Iran. Just reinforces my previous opinion that when his mind leaves North America, his IQ drops from 140 to 40. He just can't get his congenital hatred of Islam out of his system.

John Day said...

Joe in NC and El Gallinazo,

We shall see about Iran, Syria and so on. I was convinced from 2005 that attack upon Iran was imminent, and it has been ongoing, but not overtly.
The Persians are historically quite clever and innovative in matters of diplomacy and intrigue. They are not dullards, but sophisticated. The US/NATO/Israel have taken a brute-force approach in recent decades, assigning really incompetent people to important tasks, like getting Iraq's power grid running. The (intentional or not) result is very expensive morass and tactical failure.
This stupid-brute-force approach of empire may indicate "final days" or something, but "final days" could mean a century of decay. Who knows?
It looks like the next 30 years are slated for a massive reduction in our species.
I have work to do. Death looks like the easy way out for me some day, but not for the many who are unprepared...

Ash said...

re: oil prices

The Western MIC and $IMFS have really brought immense power to bear on controlling the world's supply of "liquid hegemony", as Nicole refers to it. While our actions in the ME are certainly leading to significant blowback and increasing geopolitical strains with the East, it seems that it will be a very uphill battle for those wishing to put up a solid challenege to the dollars for oil trade.

In the short-term, what matters is the fact that all of these export countries still rely on dollars and treasuries to keep their economies stable/growing and recycle their profits, combined of course with our very large, spreading and exacting military presence. The EU/US sanctions (or Iran's premptive sanctions) will effectively force to under-sell their oil to Eastern countries. It may also push up oil prices here, but I doubt that will last.

As Chris Cook pointed out in the article "Naked Oil", the Brent "complex" is priced by financial derivative transactions more than anything else. The oil majors and large institutional investors have used these transactions to amass a "dark inventory" that can be unloaded back into the market when oil prices (and differentials in prices) get high/wide enough, perhaps in sync with a wave of risk-off panic selling originating from Europe. Make money on the way up, and then make money fleecing the speculative longs on the way down.

The oil majors buy back their oil at cheaper prices and the $IMFS keeps a hard cap on prices as well, bankrupting Iran in the process. Of course, this is a very simplistic view of how it could all play out, and a full-blown US incursion into Iran could change the dynamics significantly, since that may lower the costs to Russia and China of completely defecting from the dollar-export-energy model. But even that would depend on how it actually plays out.

Joe in NC said...


Thanks for the reply - It seems your thoughts on a US invasion of Iran may have changed in the past month or so. I remember you saying that the US was in no position to try a land invasion in Iran - it would be suicidal. I'd be interested in knowing if something made you change your mind on this - only if you'd like to share.


seychelles said...

From 29 Jan 2012 Jesse's Cafe Americain:

For truly, what does it profit a man, to gain the whole world, but lose themselves.

vangoat said...

Isn't it fun to watch idiots hop about after shooting themselves in the foot? (BTW pronouncing 'idiots' like the Russians do I feel brings out a fuller meaning of that word)

Just ran across this which could be fun to watch playing out:

Iran Set to Turn Off Oil Supply to Europe

"If this bill is passed, the government will be forced to stop selling oil to Europe before the actual implementation of their sanctions," said Emad Hosseini, spokesman for the Iranian parliament's energy commission, reportedly said. The bill is set to become law on Sunday."

Hombre said...

Vangoat - "Isn't it fun to watch idiots hop about after shooting themselves in the foot?"

Yep, fun but disgusting at times. I have been doing it all my life but wasn't truly aware of it until about the time of Reagan's bully occupation/attack on that extremely dangerous country called Grenada! :-)
I am confident LG is correct that this Iranian thing is not so much about their atomic plant program, rather there are other more "liquid" and even religio-historical motives. If large FF deposits were discovered in, say, Nambia, we would soon find something they were doing that endangered US security and we would "have to go in" and make amends!
I'm about convinced we, as a human race, have evolved into a state too spoiled, greedy, and comfortable to survive. We're like the Hoosier National Forest campground in late July--the first time someone strikes a match--BOOM!
Prepare... and mostly prepare your mind!

ogardener said...

Blogger Frank said...

I can only speak for one observation point, but right here on my rocky New Hampshire hillside, warming did not stop in 1997, but has continued right on through yesterday afternoon.

Compared to last year this winter season so far has been a walk in the park. I don't have to make so many trips to the woodpile for the heating of my home and that's quite alright with me. :-) I've only had to plow once in 2012 and that was only a six inch snowfall which has since melted away. For the most part it's been an open winter in my neck of the woods in Connecticut and the temperatures mild. I think most people who spend a significant amount of time outside can detect that things ain't like they used to be climate wise.

Bigelow said...

So the sun goes into one of those minimum output cycle thingys and the greenhouse gasses trap ever more solar gain for the earth and the result is what?

Frank said...

Ogardener, yep, last year was the coldest winter here since 1999-2000. This year, the sap is running in Mass. right now.

vangoat said...

Hombre you say:

"I have been doing it all my life but wasn't truly aware of it until about the time of Reagan's bully occupation/attack on that extremely dangerous country called Grenada! :-)

Yes it is amazing that what was learned from from Vietnam was not enough and they decided to test their muscles of world hegemonic power in little Grenada. Iraq did not listen and suffered the consequences, even so, what a pyrrhic victory that looks to be, and wil be if they let their dogs loose on Iran. Toast, or should I say Shish Kabob!

Also, I agree FF is what the war is about but that the battlefield is US dollar supremacy.

“Iran and Russia replaced the U.S. dollar with their national currencies in bilateral trade . . . . The proposal to switch to the ruble and the rial was raised by Russian President Dmitry Medvedev at a meeting with his Iranian counterpart, Mahmoud Ahmadinejad . . . . Iran has replaced the dollar in its oil trade with India, China and Japan.”

A Fall Guy said...

@ Bigelow

So the sun goes into one of those minimum output cycle thingys and the greenhouse gasses trap ever more solar gain for the earth and the result is what?

If the solar minimum output cycle offsets (and hence masks) the effects of human GHG production, the result will be even complacency (if that's possible). Then when the next maximum output cycle the two effects align.

Sometimes I wish I could deny climate change (it would be easier to have more optimism), but reality keeps intruding with unwelcome observations both in my garden and in my work on broad scale landscape processes. For example, forest companies in Canada start planting trees with genotypes from further south. This is based on both current/past observations as well as the expected climate in which these trees will be growing.

That said, I don't debate the issue because people hold to their beliefs (on both sides) as strong as religion.

. said...

I read a foreign policy thing that is as well regarded in that realm as TAE is for finance.

We're all watching Iran get trolled hard and not take the bait - Israeli right wingers and some crazy Americans want that conflict. The grown ups want to spank.

Invasion of Syria? Absolutely not in the cards, has never been mentioned, there is only some talk about a no fly/no armor zone, like we provided for the Libyans. The particulars escape me, but due to the proximity of Israel and Turkey, the United States recent exit from the Iraqi adventure, and the Arab League taking a direct interest it is highly unlikely that this will happen.

Of course, an economic crash, with attendant food price rises and supply volatility? That could set off another spasm of revolution from Morocco to Pakistan.

Nassim said...

Maybe France should start to manufacture those little mopeds with the engine over the front tire, so popular in the 1960's.


Jim R said...

Re: Global Warming ...

The effect of CO2 in the atmosphere is to retain heat that would otherwise radiate off into space. This opacity of certain gases to infrared has been known for more than a century. It will retain more heat in the troposphere, where the air is dense. The thinner air at higher altitudes will cool, as it will have less radiant heat coming up from the Earth. These changes are already observable by anyone seriously taking measurements.

The methane that is now bubbling out of the tundra at high latitudes will have a similar effect, but its lifetime in the atmosphere is only decades, not centuries.

There is a popular notion that, as the atmosphere contains more heat, it will generate more violent weather. But I am now convinced that the warming from CO2 will have an effect similar to raising the cosmic background temperature. The greenhouse gases do not undergo phase changes, and do not transport great quantities of heat vertically nor horizontally, as H2O does.

Earth's winds and currents are effectively a heat engine, driven by the temperature difference between the Sun at >5000°K and the cosmos at ˜4°K. Therefore, there will be less energy to drive winds and currents and storms.

As for sunspot cycles, elliptic orbits, volcanism, the nemesis planet, and / or the weather on Pluto, those things are interesting to know, but irrelevant to CO2-based climate change.

Nassim said...

As for sunspot cycles, elliptic orbits, volcanism, the nemesis planet, and / or the weather on Pluto, those things are interesting to know, but irrelevant to CO2-based climate change.

Yes, sure. That is what I was afraid of. Everything is irrelevant other than CO2 :)

John Day said...

Iran Watchers,

This just in (from a highly dubious source, DEBKA): The US is massing 100,000 troops near Iran, in fairly short order, on the island of Socotra, off the coast of Yemen, and on the island of Masirah, an Omani holding at the Southern outlet of the Strait of Hormuz.
The Iranian Parliament has paused in it's preparations to cut off oil to the EU 6 months before they are ready. (Perhaps there are negotiations taking place)

Anonymous said...


I think El G meant a Solex.

I had one back in the mid-70s. Great if you were going less than 10 km. It consumed almost nothing, I think less than one litre to go 100 km. For people in the U.S., that works out to about 300 miles per gallon.

And robust. The motor simply would not die, though it could be difficult to start. If that happened, you simply pulled back on the lever to free the wheel and pedalled.

Lots of fun.

Jack said...

Hi John Day
The military force that is about to be unleashed against Iran by the west will not be stoppable.
I don't know what plans the Russians and the Chinese have but I suspect that they will choose weak points that the west will not be able to have a control over.

Joe in NC said...


Maybe a war tune or two to mentally prepare?


Jim R said...

Irrelevant if you are discussing the climate change which will inevitably be caused by the CO2 humans have spewed over the last couple of centuries.

There isn't anything we can do about those other factors, and it's hard to say in which direction they will drive the climate, but there IS ONE variable that is clearly human-derived.

With that said, I don't expect humans to deliberately reverse it. Most of the damage has already been done. In fact, if there were enough mineral carbon around, I'd expect humans to burn through it until (at ~25 times the present level) CO2 reached toxic levels in the atmosphere.

Mister Roboto said...

He just can't get his congenital hatred of Islam out of his system.

Not to mention his disdain for homosexuals.

Mo Rage said...

And all the while, the average American is paying virtually no attention to the European situations and haven't for the last year or more.

It isn't going to be pretty, as is repeatedly said here and elsewhere.

Joe in NC said...

Sanctions can only deepen the Iran crisis

Whatever the intentions of Barack Obama when he was elected, the covert offensive initiated by President Bush against Iran has continued. He signed a secret "presidential finding" in 2008 under which $400m was allocated to fund Iranian government opponents. The US's new allies included unsavoury groups such as the Sunni sectarian killers of Jundullah operating in Iranian Baluchistan. The US may have intended to limit the degree of co-operation but, according to Foreign Policy magazine, Mossad agents simply posed as CIA members in dealing with Jundullah. What was the point of these pinprick attacks? A few bombs in Iranian Baluchistan are not going to pose much of a threat to the Iranian leadership in Tehran. The motive was most probably to provoke the Iranians into retaliation against the US which would bring a US-Iranian military conflict closer.


Gravity said...


Study this graph for a broader geological perspective. Margins of error aproach 95% further back in time, closer datapoints are more accurate.
Note the maximum margins of error as related to the minimum co2 levels and minimum temperature in epochs known to have been thriving in complex life.
Atmospheric co2 concentration doesn't have a strong correlation with atmospheric temperature over geological time.
We're still well below average co2 level, which seems to have been above 1000pppm on average for most of the past 300 million years. Atmospheric O2 was also higher for much of that time, influencing temperature couplings.
Current c02 levels, after having risen rapidly from 280ppm to 390ppm now, are only now above average for an interglacial period. Co2 levels must presumably never drop below 200ppm, the oceans would freeze below this.

The relatively swift rate of atmospheric co2 increase might be unusual this time, increasing the chance of overpowering temperature feedbacks and changing sealevels, a meltable glaciated landmass at the pole may yield anomalous effects.
What we've attributed so far as related exclusively to atmospheric co2 from antropogenic origin is no more destabilising than an average gigaton bolide impact, which are survivable for the biosphere, even if causing mass extinctions.

I'm more concerned about deforestation, overfishing and exogenetic contamination than atmospheric co2, in greater threats for biospheric collapse. Runaway exogenetic contamination, as triggered and left unchecked, has a good chance of extinctifying all terrestrial plantlife within 200 years, greenhouse gasses have 0% chance of doing that within this interval.

As for co2 toxicity, this would occur at 50.000ppm atmospheric concentration, the co2 level of human breath. The biological cutoff range for energetically profitable respiration may require an atmospheric co2 level below 15.000 ppm for terrestrial vertebrae, depending on gas exchange efficiencies.

Gravity said...

That graph doesn't contain the error margin, this one does:

It is a huge margin of error, but the more recent parts should be more accurate.

Frank said...

Pflow, nothing that happens in Europe will affect my well being as much as the quality of the sap run this spring.

Meanwhile, I get much pleasure watching the provincial snobs getting their comeuppance by being ignored by people who live in countries big enough to see on a globe.

Ash said...

Brussels tomorrow will nicely encapsulate the stark contrast between the efficacy of grassroots action with the poisonous, wasteful and sclerotic top-down policies of the Eurocrats.

EU summit on debt crisis faces Brussels disruption as unions strike

"Three of Belgium's biggest unions are expected to bring Brussels to a standstill on Monday and complicate the arrival of EU leaders for a summit that is their first attempt this year to resolve the single currency and sovereign debt crisis.

Air travel will be seriously disrupted, public transport halted, and roads blocked in the 24-hour strike called to protest against the austerity packages raining down on the EU, with the new Belgian government seeking to lower its debt by raising taxes, slashing benefits and laying off workers.

The issues behind the strike are the same as those on the agenda for the summit. Greece's desperate plight hovers over the meeting, although formally there is no mention of Greece on the agenda or in the statements drafted for the meeting."

el gallinazo said...


Yes, I was referring to the Solex but couldn't remember the name. I was in France in 1967 and they were very popular. As I recalled the 2 cycle motor powered the front tire by direct friction.

Joe in NC

Well, there are two approaches that the aggression can take. One is air strikes by the USA, Israel, and NATO, and the other includes a land invasion afterwards. As to the latter, this will not be a surprise or secret, as the USA would need at least a quarter of a million troops, probably considerably more, even to consider it. As to an aerial bombardment, it seems pretty clear that Iran can shut the Straits to oil traffic quite easily, and also take out Saudi and Emirate oil infrastructure with conventional missiles and and commandos. It seems pretty certain that Israel will also get hit hard with missiles. I would not be surprised if the USA lost a few aircraft carriers in the mix if they enter the Persian Gulf. No doubt Faux News and CNN ratings will go up unless it conflicts with the Superbowl. CNN can title the miniseries Shock and Schlock.


After feeling the ignominy of watching the final helicopters leave the US embassy in SaIgon, the momentous victory under General Gipper over the Grenadian Empire forces made me so proud I popped a few chest buttons. Afterwards nutmeg could flow unfettered to the entire world. My Easter ham was a great success.

el gallinazo said...

The USD has fallen 8% against the Mexican peso in the last month. I will be facing a taco shortage.

Nassim said...

I think El G meant a Solex.


Quite right. I have never been on one. Noisy gadgets. :)

I thought Mobylette was the generic name and was surprised not to find the one I was looking for in the pictures at my link.

Mo Rage said...

Frank, to your comment:

"...nothing that happens in Europe will affect my well being as much as the quality of the sap run this spring.

I think you're mistaken. I believe that China's and the US' economies will both be dragged down by the tanking of the Euro and Eurozone. It's only a question of how much. I think here, too, it will be significant. We'll see, of course.

Mo Rage said...

As to anyone's comments here on climate change or global warming or whatever we agree to call it, don't mistake the very temporary path of the jet stream so far this winter--keeping us warmer down here in the contiguous 48 states but dumping loads of snow on Alaska--with the longer term pattern of the ice caps and glaciers all melting at heretofore unseen rates.

But what that has to do with the economic future of Europe, the Euro and the world escapes me, other than having a conversation here about it.

Nassim said...

... if there were enough mineral carbon around, I'd expect humans to burn through it until (at ~25 times the present level) CO2 reached toxic levels in the atmosphere.

Urban Roman,

I am glad there is something that we do agree on. CO2 is just as much out of our hands as the solar constant.

Nassim said...

I'm more concerned about deforestation, overfishing and exogenetic contamination than atmospheric co2, in greater threats for biospheric collapse.


I wholeheartedly agree. BTW, thank you for writing in language that simpletons like me can easily understand. :)

Here is one of the things that really scare me - Where have all the fish gone?

Joe in NC said...

Nassim -

"CO2 is just as much out of our hands as the solar constant"

Yes - it does seem futile to pursue...and this reality is sad when considering the consequences of ignoring it.


vangoat said...

Looks like fun no matter which way it goes;)

"Greek debt deal may not equal Wall Street relief"

Ruben said...


If you don't care about CO2, but do care about fish, perhaps you will care about oysters.

CO2 mixed with seawater forms carbonic acid that depletes our oceans of a nutrient vital to building shells. Known as ocean acidification, this process slows growth or even dissolves shells to the point where oyster larvae cannot survive.

Ocean acidification is an emerging global problem, particularly because shelled organisms like oysters are an essential nutrient throughout the entire marine food chain.

NOAA - Promoting Economic Vitality

...if we continue our current rate of carbon emissions, global oceans could be 150 percent more acidic by the end of the century than they have been for 20 million years.

Northwest Oyster Die-offs Show Ocean Acidification Has Arrived

Jim R said...

The military force that is about to be unleashed against Iran by the west will not be stoppable.

Hubris. Pride goes before a fall.

el gallinazo said...

Urban Roman

Between hubris and the following motto, makes one think of the unstoppable Athenian invasion of Sicily.

el gallinazo said...

Re the Solex

The heart of this mythical beast still throbs. It is currently being manufactured in the anus of the beast - more specifically New Jersey, and can be yours for a mere $1895. ¡Sacre bleu! Fully equipped with a 0.80 hp motor.

el gallinazo said...

The Durdens are at their snarky best as they describe how at least $1.2B, and probably considerably more, of MF Global segregated client money (in the words of the WSJ) "vaporized." I guess if it vaporized, then it couldn't have been stolen. Stealing a vapor is really difficult - it just slides through your fingers and is often toxic. But I would prefer to refer to this process as a quantum translocation, where at one moment it is in the hands of the clients, so to speak, and in the next instant in the hands of Jaime Dimon. These eigenstates are dictated by non-deterministic probability collapse upon semi-conscious observation. The probability outcome of a Dimon relocation is 99.98%.

Of course one should bear in mind that these segregated funds were more protected legally than your standard checking or savings account or bank CD.

Hombre said...

I remember the old "mopeds" from the 50's here in Indiana,some of which may have been Solex.?
Sometimes I wish I had a small assist for my BikeE as I get older and the pedals seem a little harder to turn. :)

Weatherwise,for whatever reason, this is the first winter EVER that I have not been called to remove snow from the driveways and walkways of the few folks I take care of locally. Interesting, but Im not ready to say it's proof of anything earth-changing. It's nice though to have had time to read more and take care for my wife who had a shoulder repaired.

As to the Euro situation I'm confident they can weather great economic changes better than we here in the states, since it hasn't been that many generations ago that the continent and surroundings were in total war and political and economic chaos. For my part, I wish them well, and I do think whatever happens will effect us all. We all have a lot of perks to give up, and pretty soon IMO.
"...we'll always have France..."
--Rick, Casablanca

Supergravity said...
This comment has been removed by the author.
Supergravity said...

"if we continue our current rate of carbon emissions, global oceans could be 150 percent more acidic by the end of the century than they have been for 20 million years."

The contemporary oisters might not be adapted for higher acidification, but this might not be an unadaptable condition for all calcifiying seacreatures.
If the bottom of that foodchain was impacted in this way, it would be disasterous.
If this graph is not entirely amiss, atmospheric co2 in the jurassic, 160 million BC, was at least 600ppm and possibly as much as 4000ppm, but we do find many shelled sea fossils from that time.
Atmospheric co2 might not have linear correlation with ocean ph and carbonic acid either, considering the high co2 levels in past eras and the concurrent fossil record with seashells.

It should be easier to calculate what co2 was in the distant past based on real paleoatmospheric sources, than to guess what it´ll be at in 100 years time based on models missing half the variables.

I do consider antropogenic climate change or even forced biosphere collapse, deep mass extinctions, as a strong possibility and threat for human survival for the next 10.000 years and onwards, but I do not consider greenhouse gas expulsion and possible feedback thresholds on temperature and methane expulsion to be the primary vector of destabilisation and species extinctions for now.
Im also unconvinced the climate science is still honest at this time.
Im not sure whether the planet overall is still warming or not by an amount greater than a statistical error margin, or that sealevels are rising or not, or have ever risen since the last ice age ended. Some measurements that indicate not seem as methodically sound as those indicating rise and warming.
Some regions have experienced anomalous wheather patterns, but this doesnt directly indicate that temperature change is real on a global level.

Co2 has certainly risen over 100ppm in just 150 years, from 280 or so when measurements began to 390ppm now, which is a large proportional increase, and since we´ve been burning so much stuff, it would seem logical to assume this is the cause of said co2 rise. Yet there are plausible alternatives to this direct causal relation, which could have coincided by chance with the growth of cities and industrial revolution.
These include factors of external solar forcing, the theory that interglacial co2 rises normally trail global temperature increases as a delayed effect, or that co2 and temperature cycles are interlocked with multimodal sunspot cycles or cosmic radiation flux somehow, influencing cloud formation and molecular coherence of atmospheric constituents by shifting particle showers.

Supergravity said...
This comment has been removed by the author.
Kaiser said...


I am not sure what planet you're on but this one is definitely warming. Anecdotally, from my perch in Canada (and we know our clod up here) it has been incredibly warm even last winter was warm but it snowed a lot. This winter is non-existent. Rain and a lot of it in late Jan into Feb is just plain freaky.

I checked your link and I suggest to you that you avoid getting your science facts from what looked to me a tabloid type paper where at best they cherry pick paragraphs from real science pieces but mostly with the owners agenda.
I would stick to science academies. My quick Google showed me that most connections to sun induced warming broke their trends in the late 70's. Here is a link to a site focused on climate that completely debunks your sited article: In a nutshell the oceans have absorbed the bulk of the Co2 induced warming. Even while global means may not have increased as much as models would suggest the oceans sure as heck did. (They have also continued to acidify, which is another nightmare scenario that has lead to multiple mass extinction events on planet Earth)

Please take the time to read all of it!

Lastly, just think about this: the vast majority of climate scientists sign up to the threats posed on climate change, not unlike the debate on "do cigarettes cause lung cancer" where the vast majority of doctors claimed it did yet a couple of "paid-experts" showed data to obfuscate the truth. Do you think smoking causes cancer?

Even more to the point, when the IEA says we have precious few years to reverse CO2 emissions to avoid climate induced catastrophe or when the Insurance industries insurer (Munich Re) says warming is real you should heed their advice unless you enjoy Russian roulette or like the view with your head in the sand?

Supergravity said...

I've retroactively rectified some statements, so they'll always have been read this way.

I mentioned that according to some sleeple, mr Monti was appointed by parliamentary coercion and not by general election, and that he was a treacherous sell-out bankster
without loyalties to the italian people, and an enemy to democracy.

This description may be overly harsh, based on Monti's central banking background and affiliation with Goldman, his appointment as this time does seem of a dubious nature, possibly involving an overt transnational banking coup and technocratic consolidation of italian fiscal sovereignty.
His shadowy appointment was undoubtedly legal according to the italian constitution, but not entirely honourable and in accordance with the spirit of democratic representability,
which especially in times of political crisis demands policies of honest and informed consent
instead of authoritarian abuse.

I also said that "Not respecting or adhering to constitutional principles according to the vested powers and duties of office, holding those in contempt, is how you can tell exactly that they're evil treasoners."

This is a cruel and hasty distinction to make. Contempt of oath only generally reveals defective moral agency to the state, or not being within limitations of power. Providing a constitution does wholly embody the principles of human dignity, civil rights and the rule of law over the state, then having such contempt of a sworn oath by using vested powers against the citizenry, particularly for state-sanctioned murder and mayhems, might be a qualifier for treasonesque conduct.
It would be actual Treason as criminal offense to follow traitorous orders, like orders to genocide the sleeple, directly towards the purposeful destruction of the republic, as the 'government' issuing such orders would be a hostile occupying power to not adhere to.

Finally, the chinese constitution does not literally say that the chinese people are slaves,
it says it in a circumspect way, that they have a duty to work as well as a right, that they have no right to interfere with the socialist economic order,
no right to freedom of expression or to political organisation outside the state and no right to voice discontent about socio-economic issues. It does actually define a right to rest, but this is not enforced much.
The chinese comstitution has lofty collectivist ideals as expounded, but any accidentally enumerated liberties are ruined by the mandatory communist domination over individual reason, it is remarkably inferior in social justice and in limiting state power.

Alexander Ac said...


I'm more concerned about...

what is important is what you do, not what are you concerned about...


Jerry McManus said...

Freddie Mac Bets Against American Homeowners

"Under acting director DeMarco, the FHFA has emphasized that its main goal is to limit taxpayer losses by managing the two companies’ giant investment portfolios to make profits. To cover their previous losses and ongoing operations, Fannie and Freddie already had received $169 billion from taxpayers through the third quarter of last year.

"The FHFA has frustrated the administration because the agency has made preserving the value of the companies’ investment portfolios a priority over helping homeowners in expensive mortgages."

Don't miss the bit about "inverse floaters". Is it just me, or is our financial system starting to sound like bad toilet humor?

Hombre said...

Something is hitting, or about to hit the fan...

"It is a perfect storm of problem. Greece in danger of a disorderly default, Spain is tumbling into recession, Portugal is all but certain to need another bailout, Italy drowning is in debt and France’s debt costs have risen as its credit rating was downgraded."

Eurozone crunch time

Josh said...

30 Year Treasury Bonds

I really don't understand why TAE resists the 30 Year Treasury Bond.

It's virtually guaranteed to drop in yield to the 2% zone (probably lower) if your deflationary storm scenario unfolds. As Hugh Hendry advised, if you believe hyperinflation is coming, then you should buy the 30 Year Bond, because before the FED would have the political support to truly print, the 30 year yield would need to compress to something around 1%. These things don't end in a whimper, they end in a Huge Bang.

And as the dollar benefits, so too does the 30 Year.

And with yields dropping and others ducking and running, you'll have more than plenty of willing buyers in the secondary markets.

Stoneleigh said...

We don't really resist 30 year bonds, we simply suggest that shorter term instruments will be more highly liquid for longer. Granted yields on 30 years will be low for a while yet on a flight to safety, and that the secondary market for them will be fine for a while. Both short and long term US debt will be a better bet than many other things for the next couple of years IMO, but shorter term should ultimately be safest.

Nassim said...

Dozens freeze to death as temperatures plunge to MINUS 26C (-15F) in parts of Eastern Europe

"swings and roundabouts"

Mo Rage said...


On your article: Dozens freeze to death as temperatures plunge to MINUS 26C (-15F) in parts of Eastern Europe

It isn't the isolated spots on the planet, high or low, but the overall temperatures and affects on the flora and fauna that are surely the issue, if there is one at all. (And I--and far more importantly, scientists--think there is a good deal for concern).

Josh said...

West meets East. -- Global Trade and Finance Rebalancing.

West = Europe and US
East = Pacific Rim, Southeast Asia, China.

Western Challenges - Gradual reduction of social safety net (i.e. withdrawal of optical illusion/backstop guarantees) while redeveloping production and shifting from consumption to saving and investment.

Eastern Challenges - Increase social safety net guarantees (i.e. the contruction of optical illusion guarantees), promotion of consumption.

Both global regions must accomplish these macro scale tasks in the face of corporate and real-estate derived debt deleveraging.

In both regions, greater state intervention will assert itself to control and spread the distribution of losses that have already occurred.

Western Mechanisms for Redistribution:
1) Capital Controls to support critical central government, health care and industrial financing. -- the dissolution of state retirement guarantees (Social Security) will be coupled with sticks and carrots to guide new mandatory savings and investment into directed channels. Media will play a critical role in the construction of new social conditioning that promotes savings over consumption -- the seeds of these movements have already been planted, they require only psychological watering and fertilizer.
2) Reduction in health care guarantees through requirement of personal health responsibility.
3) Withdrawal of care from the 10% of the most sick who consume 90% of resources.
4) Mandatory premiums from all citizens.
5) Means testing of benefits

What the public gets in return -- a basic safety net of care is maintained for all. Social Order. Maintenance of critical infrastructure.

Josh said...

Eastern Challenges:

Optical social benefit backstops will be required to maintain social cohesion and central control as manufacturing and real estate driven investment slows.

Capital Controls -- As with the west, control of capital flows will become more assertive to distribute the losses in the real estate sector.

Growing internal consumption will drive industrial growth as western social restructuring progresses. Optical backstops will facilitate this process along with gradual increase in consumption of western-derived manufacturing and primary goods.

Josh said...

In both the East and the West -- A phase of Intense debt deleveraging and virtual/imagined future purchasing power destruction will be necessary to break existing political logjams as well as resource constraints.

Reorganization and regrowth will be facilitated by a reduction of baseline societal expectations. This process has been underway for the past decade. The deceleration of shifting marterial expectations is largely a challenge of social conditioning. Social media will play a critical role in the efficient transmission of new expectations and standards.

Mo Rage said...


how do you define your term "optical backstops" or "optical backstops/illusions." Additionally, are they always--do they always involve these "illusions"?

ex VRWC said...

As I listen to Nicole expand on the need for decentralization and local community, I cannot help but contrast this with an earlier age. I am currently reading 'A Distant Mirror' by Barbara Tuchman, a history of the 14th century. Among many things, Tuchman talks at length about the way the knights lived between campaigns - through brigandage (terrorizing and plundering the local communities).

In a decentralized future, what will prevent the strong, still wielding the vestiges of power such as guns and modern weapons, from cannibalizing the rest of society? How much are we analyzing the need to somehow defend/prevent this when we discuss what preparations must be made?

Josh said...

Optical backstops/guarantees -- minimum expectations and living standards established through social conditioning and promoted by the state to facilitate present consumption. They don't exist in an absolute sense. They are useful figments of the imagination. They are real only during economic expansion and the earliest stages of stagnation. Remodeling and Recreation of these backstops during periods of stagnation and decline is the central challenge for the leaders of media and policy. Media leads here. Policy makers are part of the show.

Jim R said...

A little chemistry nitpick here -- the article you cite uses the phrase "150 percent more acidic" (2.5 times as acidic??), which you quoted.

Acidity is normally measured, and calculated, as pH, which is not a linear scale. So "150 percent more acidic" is completely meaningless.

But in support of the defenders of oysters, a change in pH of 0.1 would be disastrous. It represents an enormous amount of CO2, and that is apparently what we are now seeing. It will potentially reduce oceanic ecosystems to jellyfish and monocellular algae and very little else. And it will take most of a century to reverse.

But as I so cynically stated before, I don't think humans will voluntarily change any behavior for the benefit of the biosphere, and it is only by virtue of the limited supply of mineral carbon that we shall stop spewing. Thank $DEITY for that supply limitation.

Josh said...

I expect far greater centralization before we see decentralization.

Decentralization will require another generation -- once stagnation and decline sets in from a much lower baseline.

Our lives have been defined by the decline. We are approaching the fall. Centralization of control will define the fall and gradual recovery from a much lower baseline.

Decentralization is the crisis 20 years from now -- when decline and fall reemerge.

Lynford1933 said...

ex VRWC:

"In a decentralized future, what will prevent the strong, still wielding the vestiges of power such as guns and modern weapons, from cannibalizing the rest of society? How much are we analyzing the need to somehow defend/prevent this when we discuss what preparations must be made?"

Of course it is a real possibility. I've been reading the articles and the comments here for a few years. This site does not spend much time on local hostilities though some are somewhat prepared. There are several sites to learn about the ins and outs of "Mad Max" times.

Frank said...

Nassim, -26C in Poland does not sound like extraordinary weather by 20th century standards. They are far enough east to have continental climate unlike the wussy Brits and French.

PFLOW I'm fully aware that this years warmth is due to the jet stream. (And all the weatherpeople are breathlessly hinting that it may finally kick south this weekend.)

Climate is what you expect, weather is what you get. Winter weather has been warm for 11 of the last 12 years. Each year the warm winter is ascribed to a different weather pattern.

It's kind of like the Northwest Passage being open for 4 years out of the last 400. Of course, it was the last 4, in a row. Of course it was the wind pattern in 2007 that started it. But 4 years and the ice still hasn't recovered?

Lynford1933 said...

Just like the sign at the filling station on the corner tells me all I need to know about peak oil, my weather rock on a string tells me all I need to know about the weather. If it is wet, it is raining etc.

Adyashanti says that enlightenment comes in small increments and words are impediments.

Nassim said...

It isn't the isolated spots on the planet, high or low, but the overall temperatures and affects on the flora and fauna that are surely the issue ...


That is precisely what I meant by "swings and roundabouts" :)

The article I referred to much earlier on - Forget Global Warming - had data from 30,000 places around the planet and confirms that the rising trend in world temperatures ended in 1997.

Candace said...

OT but for Snuffy and other beekeepers - Damning Evidence ...Pestcide Causing Bee Colony Collapse

You might have already seen it, but just in case...


krollchem said...


I would personally rather have global warming than global cooling, however those others who focus on the known effects of carbon dioxide on global warming below 10,000 ft fail to consider other factors. Here are a few factors that that can counteract warming due to carbon dioxide trapping of heat include:

(1) Reduction or elimination of sunspots during Solar Cycle 25

(2) Increase in cloud formation due to weakening of the Earth’s magnetic field along with that of the Sun

(3) Volcanic activity on cloud seeding

(4) Burning high sulfur coal (e.g. China)

Conversely, global warming can also be increased by:

(1) Darkening of snow by particulates from coal ash and dust storms from China:

(2) Submarine landslides such as the one off Norway stirring up frozen methane deposits

Alexander Ac said...

Ok, I guess all of you have now seen

THE TRUCKLOADS OF MONEY needed to save Eurozone...

if this is not a Ponzi, I do not know what is...


Alexander Ac said...

And this is a terrifying piece:

Failed treasury auction
portends Egyptian disaster

Democracy in Egypt? WTF?


StephenH said...

I am not sure if Herbal Floyds Idea is a good one.

Instead, instead of extreme austerity, we give the public more input as to which programs want to keep (and pay for in their taxes), and how much they are willing to fund with their tax dollars. We also need to focus on less debt based growth and instead focus on quality of life. If it were me, I would cut the war machine budget first and reinvest that money into programs for the poor (as unemployment will increase), our schools (to teach skills to survive again), basic health care (one that does not depend on employer and insurance), renewable energy (solar, wind, geothermal, algae biofuel, etc) and rebuilding our railroad system. Over time, we will need to learn to drive less, and commute more by rail. We will also need to adopt to less power and wean our power system off of coal and oil. We will also need to rebuild the retirement system of generations X, Y, and Z into one that doesn't require endless growth in the stock and bond markets to work properly. I also think we will need to jubilee a lot of debt and not report this to the credit bureaus.

Anonymous said...

Urban Roman and StephenH, have you considered the futures you describe if the world were to end the use of money? How and to what extent would the likelihood of those dire consequences you foresee change? How and to what extent would your concerns change?

Glennda said...

@Stephen H

I agree 99%, if only we could choose those options, our country wouldn't need an Occupy Movement so much. But with corporations buying the candidates, we have little hope of getting much for real people.

el gallinazo said...

CHS calls for the arrest and indictment of Benny and the Inkjets for counterfeiting and stoops, as does Gerald Celente, to using the F word toward the end of his post.

Hombre said...

Just an example (local town of 65k people) of local real estate and banking woes... it continues to unravel.

""It's a bad situation," Stonebraker said in an interview. "The auction company said they were going to find a viable buyer, but they didn't do what they said they were going to do. They put it off. The supposed buyer needed more time. My bank was not cooperative at all."

I read this blog to get information from around the world. But all I have to do to make myself aware of the difficulty we face is daily watch things degress around me in Central IN.
One needn't offer rosy scenatios to me, it won't work. I am living in the middle of a depression! End of story.

Hombre said...

oops... "scenarios." (Sometimes my frustration alters my keyboarding skills) :)

Stoneleigh said...

Centralization and an active supression of freedom are coming in many places (where central control can be maintained, which will not be everywhere). This will leave populations in many places much less well adapted to a low energy and low liquidity future than they might have been.

My call for decentralization is an attempt to prepare for the hard times that are coming, but I have pointed out that decentralization will run counter to the wishes of the powerful and will therefore be fought. Decentralization is a threat to TPTB because it short circuits wealth conveyance in favour of the centre.

To a large extent, freedom exists where it is in the interest of the powerful, for instance where freedom gives an incentive to generate tax revenues through our own industry, or where it allows people to act as engines of credit expansion through digging themselves into ever deeper debt holes. Where these benefits to the centre are not available, and where the freedom of the masses is far more of a threat than a benefit, freedom of the masses is likely to disappear.

A lack of access to money and energy necessarily constrains freedom of action, before any active deprivation of freedom through police state developments. The latter can be opposed, but the former will be an inevitable result of the financial bubble bursting. In other words, most will enjoy less freedom no matter what we do. Preparation in advance, through capital preservation and local decentralization initiatives, may be able to limit this loss.

Stoneleigh said...

ex VRWC,

In a decentralized future, what will prevent the strong, still wielding the vestiges of power such as guns and modern weapons, from cannibalizing the rest of society? How much are we analyzing the need to somehow defend/prevent this when we discuss what preparations must be made?

The book you mention (Barbara Tuchman's A Distant Mirror) is much to be recommended. Indeed it will be difficult to prevent brigands from pillaging. We must give some thought to protection of what we build locally. Our new site will have a section devoted to exactly this issue. I would be very pleased if you would like to contribute to it.

Protection means a lot more than guns'n'ammo, although weaponry will clearly have a place. We need to think about fencing, dogs, alarm systems, motion-sensitive security lights, window shutters etc, and above all strength in numbers. Some things will be harder than others to maintain, given the dependence on high-tech. Low-tech protection options must therefore be considered.

Having connections with those who know how to defend what they and others have will be an important advantage.

Frank said...

Nassim, the article you linked to said that a report based on 30,000 stations exists, but gave no reasonably direct way to access it. As a yank, I would have to google up the URL for the British Met website, before I could even start to look for the report. That is very different from what you claimed.

Second, the article quickly degenerated into wild speculation about Frost Fairs on a frozen Thames. At the very least that is as wild an extrapolation from the few quotes they did have, as anything the pro global warming folks have been accused of. Nor does that kind of sensationalism inspire confidence in their reporting on the original Met report.

Skip Breakfast said...

Stoneleigh said, "To a large extent, freedom exists where it is in the interest of the powerful, for instance where freedom gives an incentive to generate tax revenues..."

Gosh, I've never heard it put this way, but like a light switch turning on it is suddenly so obvious. I think there is a bias in Western culture to assume freedom has been won by the people in some service to higher ideals and a moral superiority. But it is starting to look much more likely that freedom was primarily conceded in such places as it benefited "The Centre" financially. Which begs the question of what happens when "freedom to the people" no longer provides a financial reward to TPTB.

Ilargi said...

New post up.

Goal-Seeked Analyses for Gold


Nassim said...

re: gold

It seems to me that - under the TAE scenario - gold may lose half its value in US dollars. However, the dollars in the bank may "vapourise", shares prices might collapse, farmland prices may fall even more than housing and so on. Looked at that way, gold is not such a bad thing.

BTW, in the Great Depression, the gold price rose, agricultural prices fell and farmland prices collapsed - especially so in places like Australia. Perhaps gold is a good thing to hang on to until farmland prices do collapse?

Someone recently linked to a Spengler piece about how Egyptians face mass starvation - if no one lends them more money. That is hardly good news for the big wheat exporters - United States, EU-27, Canada, Russian Federation, Australia, Ukraine and Kazakhstan.

Someone else put up this fantastic pictorial that really impressed my wife - The European Super Highway of Debt. Of course, the USA is not much better - it is in dollars but if much more monetisation goes on even the Saudis will want to keep their money elsewhere.

I suspect that the antics in the Persian Gulf will not get out of hand. However, if they do and the US loses only one aircraft carrier that would be the end of the US dollar. Non-Americans will reason, if Iran can take out one then China would be able to take out the others no sweat.

Monkey Arsonist said...

I don't really get what they're selling here. It seems, like a lot of the "new end-timers", they believe in some sort of local agrarian utopia is possible, if only we move fast enough.

First, that village lifestyle that seems to be the popular image just isn't so (you think the witch trials were imposed from the top down?). Maybe they've been watching too much PBS.

Second, places "where this already exists" are dismal subsistence crap heaps, and they are hardly filled with trust and community spirit. In fact they're powerfully insular and fragile and as damaging to the environment as most "developed" communities. If that's the future, we superfucted.

The whole thread of thought seems to be "we'll survive somehow." Why? What's the point of continuing this human experiment if it's just a slide back to how the world was 200 years ago, without the least possibility of ever moving beyond it again? It seems to me that systemic failure as prophesized everywhere now is firm proof of Bill Hicks' observation: "Human beings aren't special, we're a virus with shoes."