Daily Digest

Daily Digest 12/4 - EU Debt Not Concern for U.S. Banks, Threat to Global Food Security, Green Roofs Sprouting

Saturday, December 4, 2010, 11:00 AM
  • Sovereign Debt: In a Monstrous Grasp
  • Angela Merkel Warned that Germany could Abandon the Euro
  • Europe's Debt Woes Not a Top Concern for U.S. Banks
  • Economy Adds a Disappointing 39,000 Jobs in November
  • Wall Street Owes its Survival to the Fed
  • New Threat to Global Food Security as Phosphate Supplies Become Increasingly Scarce
  • Green Roofs are Starting to Sprout in American Cities

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Economy

Sovereign Debt: In a Monstrous Grasp (james knight)



Bond “vigilantes” might just have turned into something scarier. In a week when markets gave an unequivocal thumbs down to Europe’s attempt to contain its debt crisis through a bail-out of Ireland, the investment strategist who coined the vigilante description in the 1980s came up with a new metaphor for the investors who haunt debt-laden countries. “The governments have created their own Frankenstein’s monster,” says the New York-based Ed Yardeni. “If you run a big deficit, then you create your own monster in the form of the bond markets.” Like the runaway creature of Mary Shelley’s classic story, bond markets are on a seemingly relentless hunt for their next victim. With Greece and Ireland firmly in their clutches, their sights are now honed on Portugal, Spain and even Italy. It took aggressive emergency purchases of government bonds by the European Central Bank to restore some stability by the end of Friday.

Angela Merkel Warned that Germany could Abandon the Euro (guardia)



At an EU summit in Brussels at the end of October that was dominated by the euro crisis and wrangling over whether to bail out Ireland, Merkel became embroiled in a row with the Greek prime minister, George Papandreou, according to participants at the event's Thursday dinner. Merkel's central aim, which she achieved, was to win agreement on re-opening the Lisbon treaty so a permanent system of bailout funding and investor losses could be established to deal with debt crises that have laid Greece and Ireland low and are threatening Portugal and Spain. The Germans also called for bailed-out countries to lose voting rights in EU councils.

Europe's Debt Woes Not a Top Concern for U.S. Banks 



Investor fears of contagion have subsided—at least temporarily—in the wake of indications from the European Central Bank that it would support any country in need. But if concern mounts again, the risk is "modest" and "manageable," said Jonathan Glionna, senior U.S. banking analyst for Barclays Capital. The U.S. banking industry's total exposure to Greece, Ireland, Portugal and Spain dropped to $146 billion in the second quarter of 2010, compared with $176 billion in the third quarter of 2009, according to figures compiled by Barclays Capital. The information, taken from reports made by banks to federal regulators, includes loans, debt, equity, foreign exchange and repurchase agreements.

Economy Adds a Disappointing 39,000 Jobs in November



The pace of job growth was well short what's required to keep up with the growth of the workforce and make a dent in the high unemployment rate. Analysts had predicted job gains at around 160,000 based on a number of positive November data. Private sector job creation clocked in at 50,000 additional jobs last month -- well below expectations. The public sector shed 11,000 jobs.

Wall Street Owes its Survival to the Fed (solidswede)



For a brief, surreal moment, the prevailing narrative in Washington was that the 2008-09 bail-outs were not really so bad. In September, Treasury secretary Tim Geithner called the government’s troubled asset relief programme “one of the most effective emergency programmes in financial history”, claiming that the final cost to taxpayers would be less than $50bn. Steven Rattner, the Wall Street banker who oversaw the Obama administration’s rescue of the auto sector, wrote in the Financial Times in October that “without exaggeration, this legislation [establishing Tarp] did more to keep America’s financial system – and therefore its economy – functioning than any passed since the 1930s”.

Energy

New Threat to Global Food Security as Phosphate Supplies Become Increasingly Scarce

A new report from the Soil Association reveals that supplies of phosphate rock are running out faster than previously thought and that declining supplies and higher prices of phosphate are a new threat to global food security. ‘A rock and a hard place: Peak phosphorus and the threat to our food security’ [pdf 1.1mb] highlights the urgent need for farming to become less reliant on phosphate rock-based fertiliser. Intensive agriculture is totally dependent on phosphate for the fertility needed to grow crops and grass. Worldwide 158 million tonnes of phosphate rock is mined every year, but the supply is finite. Recent analysis suggests that we may hit ‘peak’ phosphate as early as 2033, after which supplies will become increasingly scarce and more expensive.

Environment

Green Roofs are Starting to Sprout in American Cities



The biggest green roof in New York City and one of the largest in the country, the Morgan facility’s verdant covering was completed in December 2008 and has thrived since. As the inscription above the landmark James Farley Post Office might have it, the roof has been affected by “neither snow nor rain nor heat nor gloom of night,” and has flourished through freezes and thaws, through summer rooftop temperatures that reach 150 degrees, and through weeks of drought and torrential summer storms, despite never being watered, weeded, or fertilized.

Article suggestions for the Daily Digest can be sent to [email protected]. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

10 Comments

Tall's picture
Tall
Status: Platinum Member (Offline)
Joined: Feb 18 2010
Posts: 564
Re: Daily Digest 12/4 - EU Debt Not Concern for U.S. Banks, ...

Ocean acidification may threaten food security: U.N.

http://uk.reuters.com/article/idUKTRE6B16MD20101202

 

rjs's picture
rjs
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Joined: Aug 8 2009
Posts: 445
Re: Daily Digest 12/4 - EU Debt Not Concern for U.S. Banks, ...

link bad: Sovereign Debt: In a Monstrous Grasp

should be: http://www.ft.com/cms/s/0/56376e4a-ff15-11df-956b-00144feab49a.html

idoctor's picture
idoctor
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Joined: Oct 4 2008
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ljhaines's picture
ljhaines
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Posts: 35
Re: Daily Digest 12/4 - EU Debt Not Concern for U.S. Banks, ...

Thought you might enjoy this story about buying a home for Christmas!! The video mentions you "followers of Chris Martenson"...Enjoy!

http://www.xtranormal.com/watch/7934437/

 

bandvbandv's picture
bandvbandv
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Woodman's picture
Woodman
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Joined: Sep 26 2008
Posts: 1028
Re: Daily Digest 12/4 - EU Debt Not Concern for U.S. Banks, ...

 I fret about borrowing too much on my equity just to expand a 1000 SF house to 1500 SF and thinking I'm living beyond my means, then I read stories like this...

 http://finance.yahoo.com/banking-budgeting/article/111434/familys-fall-from-affluence-is-swift-and-hard

Do you think more happiness comes from being less in debt compared to using more debt to buy more stuff?

idoctor's picture
idoctor
Status: Diamond Member (Offline)
Joined: Oct 4 2008
Posts: 1731
Re: Daily Digest 12/4 - EU Debt Not Concern for U.S. Banks, ...

Davos I hope you are still lurking here.....I miss your posts....the first video adds new meaning to the word moran LOL.

Woodman's picture
Woodman
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Posts: 1028
Re: Daily Digest 12/4 - EU Debt Not Concern for U.S. Banks, ...

To go along with that article referenced above on limited phosphate supplies threatening future food security, note that phosphorus is a major concern as a pollutant also.  Most of that phosphorus we overconsume ends up discharged to waterways causing excessive nutrient levels and problems such as algae growth and oxygen depletion.  So we're spending millions now in the US upgrading wastewater plants to treat for nutrients like P. 

Here's an article from the Journal of American Water Works I was just reading today where a plant is recovering some of that phosphorous in the waste stream to make new fertilizer:

http://www.awwa.org/files/Publications/Journal/2010/September/PDFs/JAW201009field.pdf

All fine and dandy one might think, until I realize this is just seems to be solving one problem resulting from societal complexity with an even more complex technology which is dependent on cheap energy. 

 

theyenguy's picture
theyenguy
Status: Member (Offline)
Joined: Dec 5 2010
Posts: 2
Re: Daily Digest 12/4 - EU Debt Not Concern for U.S. Banks, ...

 

Europe's Debt Woes Are Not a Top Concern For Most Investors But Should Be

As Cliff Risk Has Emerged In The European Financials

 

Cliff Risk emerged in the European Financial on November 5, 2010 as sovereign and corporate interest rates rose and as currency traders sold the Euro and other currencies. It was on this date that the world pivoted from the age of prosperity and into the age of deleveraging.  

European Financial Institutions, EUFN, were restored to life this week by ECB announcement of ongoing purchases of debt. World government bonds, BWX, and international corporate bonds, PICB, rose, which contrasts with US Treasures, and US based corporate bonds, LQD and BLV, which fell lower.

The European Financial Institutions, EUFN, in particular these eight: Deutsche Bank DB of Germany  …..  Banco Santander, STD, Spain  …..  ING Groep NV, ING, Netherlands  .….  Credit Suisse, CS, Switzerland, ….. Royal Bank of Scotland, RBS,  Scotland ….. HSBC, HBC, United Kingdom ….. Barclays, BCS, The UK …... UBS, Switzerland ….. have gone beyond the tipping point and are at cliff risk ….. as the liabilities of the  bank-sovereign debt symbiosis grow stronger.

Soon the European Financial Institutions will be going over the cliff, as the sovereign crisis deepens and bond vigilantes call interest rates higher, the market insiders short sell the banks, and as currency traders sell the Euro, FXE.  

Out of Götterdämmerung, that is a investment flameout, a Sovereign, that is a European Chancellor and Seignior, a top dog banker, will emerge from Europe’s Core, to provide fiscal sovereignty and both credit and fiscal seigniorage and implement strong global governance like the world has never known or even thought possible.

yoshhash's picture
yoshhash
Status: Martenson Brigade Member (Offline)
Joined: Sep 20 2008
Posts: 271
question about phosphorus
Woodman wrote:

note that phosphorus is a major concern as a pollutant also. 

I've been watching this one quite closely, and I agree that too much phosphorus, or phosphorus where we don't want it, seems more of a potential problem.  I don't understand why "peak phosphorus" is getting so much press when such an obvious answer to this (diversion/capturing urine) is staring us in the face?  I understand the importance of phophorus, that is not my question.  It just seems to me that once people are faced with the prospect of spiraling food costs, they will get over the psychological gross-out barrier quite fast.  It is an INSTANT, zero cost solution.  Denmark and Sweden are already starting to do this.  Is society so prudish that we will let emotions push us to the brink before we begin using human P production?

On the other hand, stopping the over-use of phosphorus, not letting it flow into our waterways- would be a much much harder thing to enforce/change/solve.

Am I missing something?  Are there factors I do not know about?  I have tried researching this, but not getting much beyond what I've just said.

 

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