Daily Digest 4/20 - Relocalizing the Trust Horizon, Systemically Dangerous Government Institutions
Nicole Foss – Relocalising the Trust Horizon (Arthur Robey)
So what happens is when you reach a limit in finance – and these limits are endogenous, you don’t need to trigger an event – you reach a limit in finance, and the changes can be extremely rapid. So if you look at what happened in Cyprus for instance, in two weeks they went back 50 years – they went from being a modern economy to having the banks closed, the ATMs empty, the shops shelves mostly empty, a cash-only economy, capital controls, and the value of these banks went from their full value down to next to nothing in a very short space of time. And so when you have the value of human promises suddenly disappearing, you crash the system.
'Catastrophic' budget laid out by Philly schools (Thomas C.)
Laying out the grimmest possible reality is a strategic move, as the district makes its case in Harrisburg and City Hall for more funding and sits at the negotiating table with its unions, including the 15,000-member Philadelphia Federation of Teachers.
Monthly individual living expenses for people seeking debt relief may be capped at 35.73 euros ($46.7) for clothing, 247.04 euros for food and 33.40 euros for personal-hygiene items, the Insolvency Service of Ireland said in Dublin today. Households in towns with “adequate public transport links” may not need a car, while private health insurance may also be banned, the ISI said.
The Canadian central banker, who is a few months away from heading the Bank of England, says banks must have a set of buffers in place to draw on in an emergency.
Speaking during a televised interview in Washington, Carney appeared to disagree with the approach taken in Cyprus last month that involved taxing deposits, but would not state his personal position because he said it might be misinterpreted.
China’s financial backing removes the main hurdle to the project, which has been downplayed by the Canadian oil community.
The collective of international agencies, finance ministers and central bank officials should perhaps be known as the Systemically Dangerous Government Institutions (SDGI). Severally and jointly, members of SDGI provide a cornucopia of global economic policy experimentation unseen in world history. The results have ranged from dismal to uneven.
Gold traders are divided on whether bullion will extend declines after the biggest plunge in three decades generated ‘extraordinary’ buying from investors and jewellers.
The Retail Council of Canada and stores such as Canadian Tire are already lobbying the federal government to try to rescind some of the tariff hikes. The Finance Department estimates that changes to the General Preferential Tariff (GPT) will bring $333 million a year in new revenue when they come into effect on Jan. 1, 2015. Those costs will be incurred by the importers and most likely will be passed on to the consumers.
Who Said The Hydra Would Take It Lying Down (Thomas C.)
Under permanent backwardation, as no gold were offered for sale at any price, the ‘price of gold’ would become a vacuous concept. Gold, silver and, soon enough, all other highly marketable goods would only be available through barter. In other words, paper money as we know it would simply cease to function. We cannot fathom how our complex world economy could operate under such circumstances. One thing was certain, though: the world economy would contract in a way that would make the contraction in the 1930’s appear as a blip on the screen.
Supercomputers could generate warnings for stock crashes (Arthur Robey)
"If improved monitoring and regulation can build some greater trust in the market, everyone benefits," said David H. Bailey, director of the lab's new Center for Innovative Financial Technology, which is building a bridge that links computational science and financial market communities.
Ice Ice Baby (Arthur Robey)
This week we speak to Professor Peter Wadhams, Professor of Ocean Physics, and Head of the Polar Ocean Physics Group in the Department of Applied Mathematics and Theoretical Physics, at the University of Cambridge. Prof. Wadhams is an expert in Arctic sea-ice, and is a review editor for the physical sciences component of the upcoming 2014 IPCC (or Intergovernmental Panel on Climate Change ) Fifth Assessment Report. We discuss the precarious nature of the Arctic Sea-Ice, the end of summer ice altogether, the problems with the IPCC reports, climate tipping points, the release of massive quantities of methane into the atmosphere, and likelihood of Southern Europe turning into desert in this century.
Gold Reveals Global Economy on Thin Ice (Nervous Nelly)
To understand the real reason behind gold’s selloff, investors first need to acknowledge that it’s not just gold coming under pressure. Industrial and growth stocks are plummeting across the board. For example, Caterpillar (CAT) is down 20% in the last 30 days, base-metal commodities are headed into bear market territory and copper is down 15% since February and is now trading at a over a 52-week low. Oil is also dropping sharply of late, falling down to $86 per barrel from the mid-90’s a few week ago. Also, the recent stock market rally has been very narrowly based. Those equities that have been working are defensive in nature like healthcare and consumer staples…that is not representative of a healthy market. What gold is really telling us is that the global economy is on very thin ice.
Lockheed Martin has been getting its feet wet in the renewable energy game for some time. In the 1970s it helped build the world’s first successful floating Ocean Thermal Energy Conversion (OTEC) system that generated net power, and in 2009 it was awarded a contract to develop an OTEC pilot plant in Hawaii. That project has apparently been canceled but the company has now shifted its OTEC sights westward by teaming up with Hong Kong-based Reignwood Group to co-develop a pilot plant that will be built off the coast of southern China.
Three years on from the Deepwater Horizon oil spill, which devastated the Gulf Coast of the US, the residents of Grand Isle, Louisiana, are still living with the effects of the disaster.
Superstorm Sandy Shook the Earth (Jason C.)
Storm-induced seismic vibes aren't a newly recognized phenomenon. In 2005, ground motions triggered by Hurricane Katrina were picked up by seismometers in California. And even storms that remain far from land can trigger ground motions, Sufri and Koper note.
Gold & Silver
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