Daily Digest

Daily Digest 5/5 - It's Payback Time For The Dollar, Rare Earth Prices Surge, Food Prices Skyrocket With Inflation

Thursday, May 5, 2011, 9:47 AM
  • The Dollar: It’s Payback Time!
  • U.N. Forecasts 10.1 Billion People by Century’s End
  • UBS Agrees to Pay $160M in Muni Bond Settlement
  • Quebec's Wind Power Potential Is Enough To Supply North America Three Times Over
  • Supplies Squeezed, Rare Earth Prices Surge
  • The Relationship Between Global Population And Global Petroleum Production
  • Food Prices Rise to Near-Record as Inflation Accelerates
  • Japan Plans Tsunami Wall At Nuclear Plant

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Economy

The Dollar: It’s Payback Time! (Joe P.)

Generally speaking, payback time should be embraced rather than feared. Your compensation should reflect your good work. When, instead of gold, you receive devalued dollars as compensation, things might be different, though. When consumers are struggling to make ends meet because of soaring food and energy prices, when unrest is erupting around the world, then Bernanke might be haunted by the French philosopher Sartre’s view that the weight of the world is resting on his shoulders.

U.N. Forecasts 10.1 Billion People by Century’s End (R)

The population of the world, long expected to stabilize just above 9 billion in the middle of the century, will instead keep growing and may hit 10.1 billion by the year 2100, the United Nations projected in a report released Tuesday.

“Every billion more people makes life more difficult for everybody — it’s as simple as that,” said John Bongaarts, a demographer at the Population Council, a research group in New York. “Is it the end of the world? No. Can we feed 10 billion people? Probably. But we obviously would be better off with a smaller population.”

    Crash Course DVDOwn the Crash Course Special Edition Set with Presenter’s Pack (NTSC or PAL)

UBS Agrees to Pay $160M in Muni Bond Settlement (jdargis)

The local governments were looking to invest their proceeds from municipal bond sales. Former UBS employees manipulated the bidding process to win contracts to sell investments, the Justice Department and the Securities and Exchange Commission said. UBS also acted as a bidding agent for municipalities and rigged bids for the benefit of other financial firms, according to the authorities. UBS at times "facilitated" the payment of kickbacks to other bidding agents, who collect proposals for government business, they said.

Energy

Quebec's Wind Power Potential Is Enough To Supply North America Three Times Over (guardia)

“Wind energy is well established in many European countries and has a long history in the United States, but it’s still a relatively new contributor to Canada’s electricity supply,” said Robert Hornung, president of the Canadian Wind Energy Association (CanWEA). “With the continued growth of wind energy we see the evolution of a new and vibrant industry that is delivering manufacturing jobs, revitalizing rural economies, and generating emissions-free power. The results from 2010 are encouraging, but we look forward to even greater growth in 2011 and beyond.”

Supplies Squeezed, Rare Earth Prices Surge (jdargis)

Neodymium, a rare earth necessary for a range of products including headphones and hybrid electric cars, now fetches more than $283 a kilogram ($129 a pound) on the spot market. A year ago it sold for about $42 a kilogram ($19 a pound).

The Relationship Between Global Population And Global Petroleum Production (Crash_Watcher)

Based on my analysis of regional petroleum production trends presented in part 2 and part 3, I was able to make some predictions in part 6 about peak oil and total recoverable oil (Q∞), for the seven regions studied: (Middle East, ME; Former Soviet Union, FS; Africa, AF; South America, SA; Asia-Pacific, AP; Europe, EU and North America, NA), as well as global (WO) production, peak oil and Q∞.

Here in part 7, I examine the correlation between global population and petroleum consumption and consider the merits of two possible scenarios for population change in light of declining petroleum production.

Environment

Food Prices Rise to Near-Record as Inflation Accelerates (jdargis)

The cost of living in the U.S. rose at its fastest pace since December 2009 in the 12 months ended in March, the same month in which Chinese consumer prices rose by the most since 2008. The European Central Bank raised interest rates on April 7, joining China, India, Poland and Sweden in a bid to control inflation partly blamed on food costs. Costlier food also contributed to riots across northern Africa and the Middle East that toppled leaders in Egypt and Tunisia this year.

Japan Plans Tsunami Wall At Nuclear Plant (guardia)

Tokyo Electric Power Company (TEPCO) also plans to triple from about 1000 to 3000 the number of staff nuclear workers and subcontractors handling the crisis to reduce each individual's radiation exposure.

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."

19 Comments

saxplayer00o1's picture
saxplayer00o1
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Home Prices Have Officially Double-Dipped: Clear Capital

 

"The biggest slump for silver since 1983 may not be over as the Comex exchange in New York makes it 84 percent more expensive for speculators to trade the metal, triggering an exit by investors.

The minimum amount of cash that must be deposited when borrowing from brokers to trade silver futures will rise to $21,600 per contract after May 9, CME Group Ltd., Comex’s owner, said yesterday. That’s up from $11,745 two weeks ago. Open interest in futures has tumbled about 15 percent since the exchange began raising margin requirements on April 25.

Prices may drop another 12 percent to $34 an ounce by the end of next week, according to the average forecast in a Bloomberg News survey of six analysts. Silver has more than doubled in the past year as record-low U.S. borrowing costs and a slumping dollar prompted investors to buy precious metals as alternative assets. "

"Not only did April data confirm the double dip in home prices nationally, real estate markets now have entered “uncharted territory” with the absence of a tax credit incentive for the first time in three years and are still falling.

That’s the bottom line from Clear Capital, whose latest report foundd that national quarterly home prices fell 4.9 percent while year-over-year national prices declined 5.0 percent.

“A note of caution to those looking for a strong end to 2011,” said the report. “The last time no incentives were in place and distressed inventories were this high, home prices fell sharply.”

National home prices have fallen 11.5 percent over the previous nine-month period, a rate of decline not experienced since 2008. All the nation’s major Metropolitan Statistical Areas (MSA) tracked in this month’s report showed quarter-over-quarter price declines.

A major factor is the price free fall is the national REO saturation rate, which reached reaches 34.5 percent after it declined to near 20 percent in mid-2010. The report noted that 2008 saw REO saturation grew similarly from the near 20 percent early in the year to 32 percent by the end of 2008."

..................2A) Home Prices Have Officially Double-Dipped: Clear Capital

"The national home price index from Clear Capital has officially entered double-dip territory.

The company says data through the end of April has pushed its reading of national home prices 0.7 percent below the prior low recorded in March 2009, as markets have become saturated with bank-owned properties.

Clear Capital’s report shows prices have fallen 11.5 percent over the previous nine-month period. A rate of decline this rapid has not been seen since 2008."

 

Fed Presidents Signal Record Stimulus Won't Be Removed Soon

Russia to Resist Rushing Higher Rates Even as Prices Climb, Economists Say

Trichet Signals Rate Move After June, Says ECB to Monitor Risks

World Food Prices Rise to Near-Record High as Inflation Speeds Up, UN Says

Spain Borrowing Costs Rise as Demand Falls at Debt Sale

Greek Debt Talks Widen Divisions in the Euro Zone

Irish Deficit Widens 41% to 9.9 Billion Euros on Bank Costs

Portugal agrees asset sale in return for €78bn bail-out

Portugal Says Economy Is Poised to Contract 2% This Year Under Added Cuts

Connecticut Raises Taxes a Record $2.6 Billion for Budget

Quinn Looks at New Plan to Keep Money From Local Government (Illinois)

Illinois tax hike boosts April revenue by 34 percent (Read the rest of the story though)

Bing presents deficit plan to help avoid takeover (Detroit)

Jim Rogers: Oil Prices to Keep Rising; 'There Is No Oil' (CNBC)

Fed’s Lockhart Says Employment Recovery May Take Three Years

Sonoma County's pension contributions to grow by two-thirds

Shorter Year For California Schools?

Jobless claims hit 8-month high

rjs's picture
rjs
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Posts: 445
Is there a real risk of the

the general story is clear: there are various cash reserves and other assets that the government can tap, and then spending has to be cut.

The Treasury secretary, Timothy F. Geithner, warned Congress in April that once those resources were exhausted, the government would have to default. 

Among the resources to be exhausted is a whopping $400 billion in gold reserves — that’s the current value of the government’s store of 261 million ounces of gold. Selling at these prices seems like quite a good idea to me: I can’t think of any particularly good reason why the government should be storing $3,500 of gold for every household in the country.
bound2chng's picture
bound2chng
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U.N. Forecasts 10.1 Billion People by Century’s End

If energy is close to peaking or at its peak and by extension food production is close to peaking how can they make a prediction for this level of continued population expansion?? What are all these new people going to eat and drink??

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crash_watcher
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10 billion people

If energy is close to peaking or at its peak and by extension food production is close to peaking how can they make a prediction for this level of continued population expansion?? What are all these new people going to eat and drink??

Hi b2c,

Although it might seem an insanely large population to think of,  just to give a bit of a preview of a follow-up piece that I am working on, my hunch is that Julian Cribb's expectation that there will be 9 to 11 billion people by mid-century is probably closer to the mark than Hanson's die-off scenario. 

 

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RogerA
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Quebec's Wind Power Potential Is Enough To Supply North America

http://windconcernsontario.wordpress.com/2009/10/06/environmental-scientist-exposes-wind-farm-scam/

I bought this book some time ago and can highly recommend it. You will find some info there not seen on tv or in most newspapers.

Tim_P's picture
Tim_P
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Posts: 298
crash_watcher wrote: If
crash_watcher wrote:

If energy is close to peaking or at its peak and by extension food production is close to peaking how can they make a prediction for this level of continued population expansion?? What are all these new people going to eat and drink??

Hi b2c,

Although it might seem an insanely large population to think of,  just to give a bit of a preview of a follow-up piece that I am working on, my hunch is that Julian Cribb's expectation that there will be 9 to 11 billion people by mid-century is probably closer to the mark than Hanson's die-off scenario. 

 

Poet's picture
Poet
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Posts: 1891
First World Problems

Anytime you want some perspective, folks...

First World Problems
These are problems only those in the First World worry about. That people in the Third World would either laugh at, or wish were their only problems...
http://www.reddit.com/r/firstworldproblems/

Maybe it belongs in the humour thread instead?

Poet

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Offline)
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Posts: 4064
Modest Fed hike needed by year-end: Kocherlakota

 

"Kocherlakota is a voting member of the Federal Open Market Committee this year. If there is an upward surprise in inflation, than the rate hike might have to come as early as July or August, he said. Conversely, if inflation slows unexpectedly, then another round of asset-purchases, or QE3, might be needed, he said."

"Despite isolated fears that the Fed might embark on a third round of easing, Lockhart indicated there was a low probability of that happening. He stated that "there will be a high bar" to adding to the Fed's already bloated balance sheet. Lockhart added that theoretical QE3 would have to come with a fixed exit strategy. "

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yoshhash
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I think WindConcernsOntario is an astroturf front group.
RogerA wrote:

http://windconcernsontario.wordpress.com/2009/10/06/environmental-scientist-exposes-wind-farm-scam/

I bought this book some time ago and can highly recommend it. You will find some info there not seen on tv or in most newspapers.

Roger,

Are you affilliated with WCO?  I don't want to be confrontational but I've been reading a lot of the stuff they post, and I am convinced that they are a front group, pure astro-turfed, NIMBYism at its worst.  A lot of it is simply not true, but they do present it in a way that sounds awfully convincing, which makes it very difficult for regular people just trying to do the right thing.

Anyone else reading it, please take it with a grain of salt and consider the source you're getting it from.

bound2chng's picture
bound2chng
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Posts: 5
10 billion people

I look forward to reading your follow-Up piece Crash_Watcher.

RogerA's picture
RogerA
Status: Silver Member (Offline)
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Posts: 106
I think WindConcernsOntario is an astroturf front group.

Roger,

Are you affilliated with WCO? I don't want to be confrontational but I've been reading a lot of the stuff they post, and I am convinced that they are a front group, pure astro-turfed, NIMBYism at its worst. A lot of it is simply not true, but they do present it in a way that sounds awfully convincing, which makes it very difficult for regular people just trying to do the right thing.

Anyone else reading it, please take it with a grain of salt and consider the source you're getting it from.

 

I do not know what WCO is. All I can say is I am not affiliated with anybody. My views are 100% my own. Regarding WindConcernsOntario. I have never heard of them before. I am from Norway by the way, have never been to Canada. (Aha - I see now what you mean by WCO)
The reason I got them in my link was I did a google search for the book and this site came up. Since they had this article about the book I thought this would give a short description of the content. And it looked to be canadian too, so that would make it somewhat more relevant was my idea. Maybe it would have been better to link right to the source like this.

http://www.amazon.ca/Wind-Farm-Scam-John-Etherington/dp/1905299834/ref=sr_1_1?ie=UTF8&s=books&qid=1254838279&sr=8-1

I do not know if WCO is a socalled astroturf front group or not. Let me say it like this: if you want some info on windfarming you have probably not read anywhere else check out this book. If you want to believe windfarming is one of our solutions to the energy crisis do not read this book.

I have seen what happened to the hydropower in this country and see a lot of similarities regarding the windfarms some interests want to start building here.

 

idoctor's picture
idoctor
Status: Diamond Member (Offline)
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Posts: 1731
Jim Rogers

Jim Rogers

KugsCheese's picture
KugsCheese
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Posts: 1428
Jobless Numbers and Commodity Prices

Why are commodities going down?   US Jobless claims 4 week moving average back over 430K.   China raising interest rates and reserve ratios, Portugal bailout, US GDP 1st Qtr 1.8%, Europe crawling.    What else doesn't justify the high commodity prices?   Will gold get caught up in this bad economic news?    Looks like US refining capacity is not where it should be.   Maybe high gas price will be high for long term, i.e. not under $3.50/gal.

idoctor's picture
idoctor
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Posts: 1731
Arthur Robey's picture
Arthur Robey
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Posts: 3936
Transitory.

The goal of the exercise is to manage public opinion, to ensure the public that inflation is “transitory.” Unfortunately the term is increasingly ridiculed as for some, a period as long as a lifetime may be transitory. Bernanke needs to regain confidence of an ever more skeptical public before the term “anchored inflation expectations” suffers the same fate as “transitory.”

http://www.merkfunds.com/merk-perspective/insights/2011-05-03.html (Dollar payback time)

(When the first Dutch settlers clapped eyes on the Cape of Good Hope.)

"Moenie bekommered vees nie mense. Alles sall reg kom." So het Jan van Riebeck in sesteen tagt en agtig gese het. Ons vag nog steeds.

"Don't worry people . Evereything will be OK." Thus spake Jan van Riebeck in 1688. We are still waiting.

 

 

 

Arthur Robey's picture
Arthur Robey
Status: Diamond Member (Offline)
Joined: Feb 4 2010
Posts: 3936
The internet filter and the battle of the Memes

Beware the internet filter.

It seeks to serve, but traps you in an information bubble.

http://www.ted.com/talks/eli_pariser_beware_online_filter_bubbles.html

And then there is Hans Rosling on world population.

http://www.ted.com/talks/lang/eng/hans_rosling_on_global_population_grow...

guardia's picture
guardia
Status: Platinum Member (Offline)
Joined: Jul 26 2009
Posts: 592
Re: I think WindConcernsOntario is an astroturf front group.
RogerA wrote:

I have seen what happened to the hydropower in this country and see a lot of similarities regarding the windfarms some interests want to start building here.

Actually, I was more interested in this bit of information from that article:

Quote:

Declining prices of solar photovoltaic cells indicate that by 2020 they could on par with traditional energy sources such as hydro.

Recently, I figured that the grid requirement for wind power makes it a much less resilient solution than solar panels on one's home...

Samuel

guardia's picture
guardia
Status: Platinum Member (Offline)
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Posts: 592
Etherington is for nuclear power
RogerA wrote:

I do not know what WCO is. All I can say is I am not affiliated with anybody. My views are 100% my own. Regarding WindConcernsOntario. I have never heard of them before. I am from Norway by the way, have never been to Canada. (Aha - I see now what you mean by WCO)
The reason I got them in my link was I did a google search for the book and this site came up. Since they had this article about the book I thought this would give a short description of the content. And it looked to be canadian too, so that would make it somewhat more relevant was my idea. Maybe it would have been better to link right to the source like this.

http://www.amazon.ca/Wind-Farm-Scam-John-Etherington/dp/1905299834/ref=sr_1_1?ie=UTF8&s=books&qid=1254838279&sr=8-1

I do not know if WCO is a socalled astroturf front group or not. Let me say it like this: if you want some info on windfarming you have probably not read anywhere else check out this book. If you want to believe windfarming is one of our solutions to the energy crisis do not read this book.

I have seen what happened to the hydropower in this country and see a lot of similarities regarding the windfarms some interests want to start building here.

Your comment resurfaced to my conscious mind today, and I just wanted to add one comment. You do realize that I cannot take seriously anyone that still thinks of nuclear power as the best solution? If you think otherwise, why don't you go take some vacation in Fukushima next time? It's cheap, I guarantee it. What's keeping you from going?

Samuel

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