Daily Digest 5/28 - The Sellout Of The Ivory Tower, UK Oil Refinery Likely To Close, NYC Beekeeping Expands
- The Sellout of the Ivory Tower, and the Crash of 2008
- By Abandoning the Gold Standard We Accepted Central Planning and Chaos
- The Fairness Trap
- Petroplus UK refinery likely to close-PwC
- Oil's Role in the Global Economic Crisis
- Iran Looks to Reduce Reliance on the Straits of Hormuz with new Oil Terminal
- The Colonies Expand
Academics on industry payrolls are now so numerous and powerful that they can often prevent universities, professional associations, and academic journals from adopting or enforcing strong conflict-of-interest policies. They also have a chilling, even dominant, effect on several areas of academic research and policy analysis.
The point is not that a gold standard is perfect or ‘perfectly efficient’ or even free of any disturbances or disruptions. The point is simply that by fading out gold as a fairly inelastic basis of the monetary system and replacing it with essentially fully elastic and unlimited fiat money, as happened around the world in the period from 1914 to 1971, we have made the financial system and by extension our economies substantially more unstable. While the system can appear stable on the surface for extended periods, the economy is constantly accumulating imbalances that will finally unhinge it.
The Fairness Trap (jdargis)
This isn’t an outcome that anyone wants. Even though a devalued currency would make Greece’s exports cheaper and attract tourists, it would do so at a terrible price, destroying huge amounts of wealth and seriously harming the country’s G.D.P. It would be costly for the rest of Europe, too. Greece owes almost half a trillion euros, and containing the damage would likely require the recapitalization of banks, continent-wide deposit insurance (to prevent bank runs), and more aid to Portugal, Spain, and Italy, which seem to be the next countries in line to default. That’s a very high price to pay for getting rid of Greece, and much more expensive than letting it stay. Read more http://www.newyorker.com/talk/financial/2012/06/04/120604ta_talk_surowie...
Petroplus UK refinery likely to close-PwC (Suzie G.)
"The current economic environment, the challenge of raising $1 billion (£625 million) of funding for the refinery, including the $150 million capital expenditure 'turnaround' project ultimately proved prohibitive in the face of an over supplied European refinery market for both buyers and investors."
Oil's Role in the Global Economic Crisis (James S.)
Capital outflows from oil exporters therefore played an important role in the global liquidity glut during the build-up to the US subprime crisis. Analysis of direct capital flows is hampered by the lack of reporting transparency and the use of foreign financial intermediaries. Indirect recycling also took place, i.e. direct oil-revenue investment in a given financial market led to corresponding knock-on flows towards the ultimate net borrower. Nonetheless, analysis from the US Federal Reserve suggests that “…most petrodollar investments [found] their way to the United States, indirectly if not directly” (Federal Reserve Bank of New York 2006). In short, the US was the ultimate net borrower, in order to finance its growing current account deficit.
Now, according to the news agency Shana, Iran has announced that the Iranian Oil Terminals Company (IOTC) plans to build a new oil export terminal on the Gulf of Oman as Bandar Jask, away from the Straits of Hormuz. Pirouz Mousavi, the managing director of IOTC said they also intend to build a pipeline to transport an extra one million barrels of oil per day to the Caspian Sea port of Neka; a move that will give them more exporting options and remove their own reliance on the Straits of Hormuz.
The Colonies Expand (jdargis)
“As soon as I got into the suit, I was hooked,” said Ralph Gaeta, a medical device salesman who keeps hives in Brooklyn and Queens and takes pride in the fruit of his labor. His Mizz Beehavin’ Apiary honey earned him second place at last year’s New York City Honey Festival.
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