Daily Digest

Daily Digest 4/22 - $5 Gas In DC, TEPCO To Cut Workforce, Fifty Factors Launching Gold

Friday, April 22, 2011, 10:48 AM
  • Gas Prices Reach Five Dollars a Gallon in the Nation's Capital
  • $6 Gas? Could Happen if Dollar Keeps Getting Weaker
  • Debt at 200% of GDP Dares S&P Amid Succession: William Pesek
  • TEPCO To Cut Workforce
  • Our "Let's Pretend" Economy
  • Australia Won’t ‘Manipulate’ Currency Now at Record, Rudd Says
  • Dollar Weakens Against Most Major Currencies
  • Kitco News - Market Nuggets
  • Silver Set to Soar as Paper Folds?
  • 50 Factors Launching Gold
  • Interview: Jim Sinclair on Gold and the World Financial System
  • Where Is The Limit For Gold?
  • Oil Crisis Just Got Real: Sinopec Cuts Off Oil Exports
  • Secret Memos Expose Link Between Oil Firms And Invasion Of Iraq
  • Tepco Must End ‘Whack-a-Mole,’ Cover Fukushima Reactors as Typhoon Season Looms
  • Beyond the Oil Spill, the Tragedy of an Ailing Gulf
  • After 5 Halflives, I-131 Higher than Cs-134/137 Suggests Ongoing Criticalities

Crash Course DVDTake home the Crash Course DVD for an insightful look at the next twenty years (NTSC or PAL)

Economy

Gas Prices Reach Five Dollars a Gallon in the Nation's Capital (ES2)

Gas prices reach five dollars per gallon at a gas station in Washington, DC on April 19, 2011. Unrest in the Middle East and price speculation have steadily led to higher oil prices and consequently higher gas prices throughout the year so far.

$6 Gas? Could Happen if Dollar Keeps Getting Weaker (ES2)

With the greenback coming under increased pressure from Federal Reserve policies and investor appetite for more risk, there seems little direction but up for commodity prices, in particular energy and metals.

Debt at 200% of GDP Dares S&P Amid Succession: William Pesek (ES2)

Japan should brace for greater skepticism of its balance sheet as politicians add to a public debt that’s 200 percent of GDP. In January, S&P lowered Japan’s rating to AA-, the same level as China’s.

TEPCO To Cut Workforce (guardia)

About 1,000 to 1,500 TEPCO employees retire each year. Although the utility has hired about 1,000 new employees annually in the past few years, this will be reduced from next year by several hundred, mainly clerical workers. TEPCO expects these steps will cut several thousand staff from its payroll, which stood at 36,733 employees at the end of 2010. TEPCO also will reduce employee salaries by about 10 percent annually.

Our "Let's Pretend" Economy (pinecarr)

There are two economies--the real one, which is in decline, and the "let's pretend" one touted by the State and corporate propaganda machines.

Australia Won’t ‘Manipulate’ Currency Now at Record, Rudd Says (ES2)

Rudd in an interview ruled out intervention in the so- called Aussie, which has gained 15 percent in the past year against the dollar. Spurred by revenue from shipments of coal and iron ore to China, the currency’s surge has hurt Australian tourism, manufacturing and education.

Dollar Weakens Against Most Major Currencies (ES2)

The dollar fell against most major currencies Wednesday, hitting a 15-month low against the euro, after solid earnings from major U.S. companies and a healthier reading on the housing market fueled investors' appetite for currencies linked to higher benchmark interest rates.

Kitco News - Market Nuggets (ES2)

Market Nuggets: ETF Securities: Inflation Concerns Help Propel Gold Above $1,500/Oz

Market Nuggets: OptionsXpress: Silver Prices Benefitting From Investment Demand

Market Nuggets: HSBC: Any Chinese Diversification Away From U.S. Assets Would Support Gold

    Crash Course DVDTake home the Crash Course DVD for an insightful look at the next twenty years (NTSC or PAL)

Silver Set to Soar as Paper Folds? (pinecarr)

Today, with the Federal Reserve treating the greenback as a never ending lottery ticket for deficit spending politicians, many investors feel the U.S. dollar is good for nothing. As a result there is an increasing international pressure to remove the U.S. dollar's reserve status. Given that there is no widely accepted alternative to the dollar (the euro has many problems of its own), this is creating fears of an international currency crisis, which has fueled interest in precious metals.

50 Factors Launching Gold (pinecarr)

As long as Quantitative Easing programs are in place and actively pursued, Gold & Silver prices will soar. The programs are urged by exploding budget deficits and absent USTBond demand. That translates to a ruined USDollar currency. Gold & Silver respond to the debasement and ruin.

Interview: Jim Sinclair on Gold and the World Financial System (TomA, ES2)

Over the counter (OTC) derivatives are the reason we are going through what we are going through now. An OTC derivative is a kind of wager on what something will do. Up until 2009, most of these wagers had very little, if any, money behind them and, if the direction you bet on didn’t come to fruition, the amount of leverage resulted in extraordinary losses. There was a major rollover in derivatives tied to real estate in 2008, as well as in other types, such as those tied to sub-prime auto loans.

Where Is The Limit For Gold? (Alfredo E.)

Gold was outshined by another precious metal, however. Silver has reached a 31-year high by almost beating the $44 mark. In the last year alone, it has raced ahead by almost 150%. No wonder some investors are now referring to silver as gold on steroids. A word of caution: the price of silver does tend to be more volatile than its gold counterpart.

The question is: can the precious metals keep up this pace?

Energy

Oil Crisis Just Got Real: Sinopec (Read China) Cuts Off Oil Exports (rhare)

As if a dollar in freefall was not enough, surging oil is about to hit the turbo boost, decimating what is left of the US (and global) consumer. Xinhua, via Energy Daily, brings this stunner: " Chinese oil giant Sinopec has stopped exporting oil products to maintain domestic supplies amid disruption concerns caused by Middle East unrest and Japan's earthquake, a report said Wednesday.

Secret Memos Expose Link Between Oil Firms And Invasion Of Iraq (Phil H.)

The papers, revealed here for the first time, raise new questions over Britain's involvement in the war, which had divided Tony Blair's cabinet and was voted through only after his claims that Saddam Hussein had weapons of mass destruction.

Environment

Tepco Must End ‘Whack-a-Mole,’ Cover Fukushima Reactors as Typhoon Season Looms (ES2)

Tokyo Electric Power Co. must speed up plans to cover reactors at its crippled nuclear plant and drain tainted water to prevent more radiation leaks as Japan’s cyclone season approaches, engineering professors said.

Beyond the Oil Spill, the Tragedy of an Ailing Gulf (jdargis)

That tragedy is the ill and declining health of the Gulf of Mexico, including the enormous dead zone off the mouth of the Mississippi and the alarmingly rapid disappearance of Louisiana’s coastal wetlands, roughly 2,000 square miles smaller than they were 80 years ago. Few here would take issue with the commission’s question, but the answer to it is far from resolved.

After 5 Halflives, I-131 Higher than Cs-134/137 Suggests Ongoing Criticalities (Debu)

During full-power operation, numerous "fission products" are in approximate steady-state equilibrium, meaning roughly equal becquerel of I-131 and Cs-134, with a slow buildup of Cs-137. But they all cease to be created when the reactors are scrammed. Japanese regulators NISA and MEXT seem oblivious of the mysterious fact that I-131 Bq "reactor density" is still often reported double the Cs-134/137 Bq. The TEPCO data suggest that fission is ongoing despite the reactor shutdowns. This is bad news.

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."

14 Comments

es2's picture
es2
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4/19: Builders offer green tract homes with nearly zero utility

4/19: Builders offer green tract homes with nearly zero utility bills
To stand out in a still-sluggish housing market, major builders are starting to sell affordable tract homes that come with solar panels and nearly zero utility bills.

The following borrowed from: http://www.caseyresearch.com/gsd/edition/silver-still-soaring-short-cove...
Fleeing the Dollar Flood
Members of the International Monetary Fund emerged from their huddle in Washington last weekend resolved to keep every option open to slow the flood of dollars pouring into their countries, including capital controls. That's a dangerous game, given the need for investment to drive economic development. But it's also increasingly typical of the world's reaction to America's mismanagement of the dollar and its eroding financial leadership.

4/20: Putin: U.S. Monetary Policy Is ‘Hooliganism’
Russian Prime Minister Vladimir Putin slammed expansionary U.S. monetary policy, calling it “hooliganism”, in remarks that followed more veiled criticism from China after Standard & Poor’s Corp. cut the outlook on its U.S. debt rating this week.

China Inflation And Wage Protests Spread, Turn Violent
Yesterday we reported news that has so far received almost no media exposure, namely that thousands of striking truck drivers had poured into Shanghai's Waigaoqiao zone, one of the city's busiest container ports, protesting over "rising fuel prices and low wages." Today, via Reuters, we learn that this situation has escalated materially, and progressed into violence...

Why Rob McEwen is STILL bullish on gold

Silver Still Soaring Carl Swenlin
While we don't often cover silver, it is worth noticing that it is about 6% below its all-time highs of 48 (closing basis) and moving up quickly. Technicians will assume that there is probably strong long-term overhead resistance at 48...

Poet's picture
Poet
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Posts: 1891
Where's saxplayer00o1?

I hope you are okay! We miss you!

Poet

Poet's picture
Poet
Status: Diamond Member (Offline)
Joined: Jan 21 2009
Posts: 1891
Demographics And Debt

I think we already knew this one was coming. Retirng without savings AND with debt (or having to rent) is gonna make a poor retirement even worse...

Baby Boomers near 65 with retirements in jeopardy (from 12/28/2010)

"Through a combination of procrastination and bad timing, many Baby Boomers are facing a personal finance disaster just as they're hoping to retire... Starting in January, more than 10,000 Baby Boomers a day will turn 65, a pattern that will continue for the next 19 years.... Mortgage Debt. Nearly two in three people age 55 to 64 had a mortgage in 2007, with a median debt of $85,000."
http://www.usatoday.com/news/nation/2010-12-27-baby-boomers_N.htm

Annd... This might just be the way out for some people who may know they don't have much longer to live, and want to go out with (borrowed) gusto. (I'm reminded of a young guy in a newspaper article a few years back who was diagnosed with terminal cancer, maxed out his credit cards and cashed in his life insurance policy to vacation around the world (like a trip to Australia), and then... survived. Oops!)

Dying with debt: A dirty little retirement secret (from 11/22/2010)
"Retired Americans are racking up credit-card debt like never before, be it for vacations or medical expenses, and a surprising number have no intention of paying it off before they die."
http://www.usatoday.com/money/perfi/credit/2010-11-21-senior-debt_N.htm

The above two are "slow burn" issues, however. Right now, I'd say the strikes in China, the supply issues stemming from Japan, the gold and silver issues, the Middle East issues - it all seems like everything is coming to a head...

Poet

 

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plato1965
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Posts: 615
Russia: 40% less grain sown than last year

MOSCOW, April 22 (Reuters) - Russian farmers sowed 1.03 million hectares with spring grains as of April 21, just 3.4 percent of the targeted area and down 679,300 hectares from the same date a year ago, the Agriculture Ministry said on Friday.

 http://www.guardian.co.uk/business/feedarticle/9609505

 Might be a weather related delay I suppose ...  otherwise it's setting up for a heck of a food squeeze.

 

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idoctor
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Posts: 1731
Chinese Renminbi Announced

Chinese Renminbi Announced As New World Reserve Currency After Emergency G20 Meeting

By Davos Sherman Okst02/21/2011
  • **Dated [xx/xx/201x]: Fill in the future date of this article/press release by using your own common sense or Ouija board, please see disclaimer at bottom.

China’s President Hu Jintao and China Central Bank Advisor Xia Bin called an emergency meeting of the G-20 Member Countries (Argentina, Australia, Brazil, Canada, China, France, Germany, India, Indonesia, Italy, Japan, Mexico, Russia, Saudi Arabia, South Africa, South Korea, Turkey, United Kingdom, United States and the European Union) this weekend.

Saudi Arabia, Turkey, South Africa, Argentina, Brazil, China, India, Mexico and Indonesia were reported to have been extremely concerned over the recent fall of Egypt and Tunisia's government. They expressed grave concern over the rapidly growing civil unrest caused by protests over rising food prices, high unemployment and other poor economic conditions in the region. Unrest has recently erupted in Tunisia and spread to Egypt, Ethiopia, Nigeria, Libya, Morocco, Bahrain and Iran.

Speculation is that China's "Jasmine Revolution" was not able to be squelched through its iron firewall. It is believed that this was what made President Hu finally take action.

China has long been concerned with inflation. Recently a growing number of its population of 1.3 billion began shouting slogans like: “We want food to eat, we want work, we want housing.” 

China has seen many of its regimes toppled by social unrest sparked by high food prices.

President Hu was quoted: “For nations outside the United States increasingly high food prices accounts for the largest part of our citizens' budget. We can not allow Ben Bernanke’s monetization of the deficit to destabilize the developing economies by exporting inflation.”  Many economist are quick to point out that in many LDCs (Least Developed Countries) food accounts for 50% of a families budget whereas in the United States it food is roughly 13%. 

China has raised interest rates several times - despite US objections - in attempts to mitigate their inflation.

Economists now predict that the United States will either default on its 128 trillion dollar debt or quickly suffer the consequences of hyperinflation through the Fed's continued monetization of the unpayable portion of the deficit. 57% of the deficit is unfunded (looted) liabilities like Social Security and Medicare. 23% of the deficit is debt service. Economists say Monday's FX rates will determine gas prices and food prices and the new value of the USD. 

"There was a growing concern that Bernanke’s fiscal policies would prove the Mayan’s correct, I suspect the United States will find an excuse to wage nuclear war over this,'" said one prominent historian. 

**Dated [xx/xx/201x]: Fill in the future date of this article/press release by using your own common sense or Ouija board. [In other words: Don't sell the USD based on this "Onion (spoof)"-type article.]. I wrote this missive to underscore that Ben Bernanke doesn't get the game of dominoes, which in my opinion closely resembles economics. Bernanke's Quantitative Easing (money printing) exported higher food prices (inflation) to countries where unemployment is high and or food accounts for 50% of their budget. Food prices are after all priced in dollars and the more dollars they print reduces the value of the dollars already in the system. Gerald Celente's "When people have nothing to lose - they lose it" saying was proved correct. Now BP is pulling workers off the 9th largest field in Libya - so the higher oil price domino is about to fall on us (and the rest of the world) and exacerbate the turmoil that Bernanke started in the Middle East and China. While it isn't in the best interest of the world to dump our dollar many leaders are going to be faced with doing just that or being deposed. This is why, for the last several weeks I have increased my repetitive banging on the re-value the currency overtly drum, if we don't we might never have the oppertunity to do so.

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britinbe
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Zimbabwe panic as ATM spits out old dollar bills

http://www.bbc.co.uk/news/world-africa-13151132

Interesting!

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Ready
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Posts: 917
confused

I'm trying to make sense of the article about Chinese oil exports.

China currently imports in the neighborhood of 10Mb/d. Sinopec handles the majority of those imports and their distribution. Are they saying that Sinopec will stop exporting it's imports?

CHINESE OIL IMPORTS

Million/Barrels Day (m/bd) 

Year Chinese Oil Imports  US Oil Imports   % Chinese to US Oil Imports
 2004  3.40  13.40  25.4
 2009  7.85    
 2010  9.60  23.80  40.3
 2015  11.40  25.80  44.2
 2020  13.50  27.90  48.4
 2025  16.10  30.00  53.6
 2030  18.79  28.50  65.9

This is the best data I could find on exports:

http://www.chinaoilweb.com/UploadFile/docs/Attachment/2010-3-119121470.pdf

which states they export ~ 125 tons / month (who measures oil in tons?????) to 3 countries, North Korea, USA, and Japan.

So the US is losing 35K tons of imports a month from China? Assuming Metric Tons, that's about 6 barrels per ton, or ~ 6000B/d we import from CHINA? Am I missing something here? Maybe this is going to military bases overseas, or China is brokering a deal between a producer and the US, and it gets direct shipped, and it will now be routed to China instead?

And is 6000 barrels a day even going to get noticed?

 

I just don't get it.

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littlefeatfan
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Weekly summary on 3 Es posted

http://3es.weebly.com/  with summary of this weeks cartoons and resource links

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rjs
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Posts: 445
Ready wrote: I'm trying to
Ready wrote:

I'm trying to make sense of the article about Chinese oil exports.

China currently imports in the neighborhood of 10Mb/d. Sinopec handles the majority of those imports and their distribution. Are they saying that Sinopec will stop exporting it's imports?

I just don't get it.

not saying that i can quantify, but the article zero hedge linked to made it clear they were exporting refined products, which covers a lot of territory:China's Sinopec cuts off oil exports: state media ...for instance, they might have been exporting diesel to japan to run back up generators...most importers also export small quanitities (i just googled US exports & got pages of EIA xls & pdf files (ie, http://www.eia.doe.gov/emeu/international/oiltrade.html)  here's one that's readable: Once again, US oil exports explained... poorly -

es2's picture
es2
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MIT Billion Prices Project

MIT Billion Prices Project: "The world inflation index will replace the country-level indexes we have been computing for the past 6 months. Although we understand that the country-specific inflation indicators have become quite successful in the financial sector, we are overwhelmed by the amount of time and resources involved in updating them within the context of this academic initiative. We must focus on our research, but we will soon be partnering with another institution that can take over the job of updating these series on a regular basis. If you want to be notified of any news, please sign up to our email list (see the sidebar)."

http://bpp.mit.edu/

They now have the following: http://bpp.mit.edu/world-inflation-index/

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saxplayer00o1
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Posts: 4149
Poet's picture
Poet
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Joined: Jan 21 2009
Posts: 1891
We Deserve The Leaders We Elect

Insightful, thinking from John Michael Greer over at The Archdruid Report. Even if you don't agree, I personally find it worth reading...

Alternatives to Nihilism, Part Two: Lead Us Away From Here
"Those of my readers who happen to be Democrats may find it educational to sit down sometime with a stalwart Republican, perhaps over a couple of beers, and ask whether this is the case. You can count on getting an earful about the corrupt liberal elite that pulls all the strings in this country. If any of my readers happen to be Republican, and try the same experiment in reverse, they can expect an equal and opposite earful about the corrupt corporate elite that pulls all the strings in this country."
http://thearchdruidreport.blogspot.com/2011/04/alternatives-to-nihilism-...

Poet

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Poet
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Posts: 1891
saxplayer00o1's Internet NOT Cut By Georgian Pensioner

Glad to see your post, Saxplayer!

The anti-social network: avoiding online darkness
"A 75-year-old Georgian woman who says she has never even heard of the internet is facing a possible prison sentence for single-handedly cutting off the web to an entire country... With one stroke, the pensioner plunged 90% of internet users in Armenia into online darkness for nearly 12 hours...

How fragile is the Internet? How vulnerable are the world's businesses? Very much indeed...

"Research carried out in October 2010 by Avanti Communications offered a snapshot of just how fundamental the internet had become to businesses. Continue reading the main story... The survey of companies worldwide suggested only 1% could function adequately without the internet... More than a quarter (27%) of those surveyed said they could not function at all if the internet went down, and one in five said a week without being online would be the death of their company."
http://www.bbc.co.uk/news/business-13158351

Poet

idoctor's picture
idoctor
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Joined: Oct 4 2008
Posts: 1731

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