Daily Digest

Daily Digest 9/27 - Eurozone Crisis Enters 'More Dangerous Phase', Silver Soars 26%, Whisky For The Environment

Tuesday, September 27, 2011, 9:49 AM
  • UBS' Euro Doom And Gloom Team Releases Sequel: "The Eurozone Sovereign Crisis Has Entered A More Dangerous Phase"
  • Silver Soars 26% In 26 Hours
  • As California State Tuition Rises, Financial Aid Offices Struggle to Adjust
  • Worried Greeks Fear Collapse of Middle Class Welfare State
  • U.S. Crime And GDP: Falling Together
  • The End Of Motoring
  • Whisky For The Environment
  • E-Waste Hell
  • Living Infrastructure

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Economy

UBS' Euro Doom And Gloom Team Releases Sequel: "The Eurozone Sovereign Crisis Has Entered A More Dangerous Phase" (pinecarr)

From the same fine Swiss folks who three weeks ago (and before it was uncovered that when it comes to playing, or at least scapegoating, dangerously, UBS is second to none) brought you, "Under the current structure and with the current membership, the Euro does not work. Either the current structure will have to change, or the current membership will have to change," comes the sequel: "We believe the Eurozone sovereign crisis has entered a more dangerous phase. Financial and banking stresses are plainly evident as concerns about sovereign default grow. Notwithstanding signs from Washington this past weekend that European and world leaders are willing to consider more decisive policies, concrete steps remain elusive. Yet rising uncertainty threatens an already weakened world economy."

Silver Soars 26% In 26 Hours (Johnny Oxygen)

It appears rumors (there's that word again) of precious metals' demise have been greatly exaggerated yet again. After hitting a low of $26/ounce just shortly after 24 hours ago, the metal has since soared by a whopping 26% to $32.90 (thank you CME and Shanghai Gold Exchange). That's $6.90 in one day. The same with gold.

As California State Tuition Rises, Financial Aid Offices Struggle to Adjust (jdargis)

aced with drastic cutbacks in state financing, U.C. tuition increased 18 percent this school year, and the university’s Board of Regents is expected to vote on a plan to raise tuition 8 percent to 16 percent a year through 2015-16. With the cost of rent, food and books also soaring, more students like Mr. Seman are scrambling to be able to afford their education.

Worried Greeks Fear Collapse of Middle Class Welfare State (jdargis)

While banks and European leaders hold abstract talks in foreign capitals about the impact of a potential Greek default on the euro and the world economy, something frighteningly concrete is under way in Greece: the dismantling of a middle-class welfare state in real time — with nothing to replace it.

U.S. Crime And GDP: Falling Together (jdargis)

Nationwide, crime rates have been falling for two decades, a trend that continued through the recession. The latest figures reveal the surprising depth of the decline in property crime between 2007 and 2010. States like Nevada, which suffered the biggest drops in per-person income, the rate of property crime has also come down most.

Energy

The End Of Motoring (jdargis)

"The way we run cars is changing fast," says Tim Pollard, associate editor at CAR magazine, "Car manufacturers are worried that younger people in particular don't aspire to own cars like we used to in the 70s, 80s, or even the 90s. Designers commonly say that teenagers today aspire to own the latest smartphone more than a car. Even car enthusiasts realise we've reached a tipping point."

Environment

Whisky For The Environment (jdargis)

Spent grains from the whisky distilling process, known as draff, will be burned along with wood to create electricity at the combined heat and power (CHP) plant. Another byproduct, a high-protein liquid residue called pot ale, will be made into a syrup for animal feed—which will be conveniently made at a plant next door.

Construction of the biomass plant is set to begin soon, the London Press Service reported last month, and it should be up and running by early 2013.

E-Waste Hell (June C.)

"It's total devastation as a result of the illegal shipment and dumping of electronic waste."

Living Infrastructure (jdargis)

Growing your own house may seem like a new idea, but what about growing pieces of functional infrastructure? That’s exactly what the locals of Nongriat in Meghalaya, India have been doing for the past 500 years. In that time, they’ve grown bridges over one hundred feet in length and strong enough to support the weight of more than 50 people. There are even “double decker” bridges!

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."

25 Comments

saxplayer00o1's picture
saxplayer00o1
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Italy, Spain borrowing rates spike in bond markets

 

"Borrowing rates for Italy and Spain spiked to the highest levels since the global financial crisis on Tuesday amid concern their economies, the third and fourth-biggest in the eurozone, could be sucked into a debt spiral.

In its first bond auction since its credit rating was downgraded by Standard & Poor's last week, the Italian Treasury was forced to offer sharply higher rates to attract investors to buy up 14.5 billion euros ($19.6 billion) in debt.

The rate on six-month bonds jumped to 3.071 percent compared to 2.14 percent for the last similar operation last month. It was the highest level since September 2008 when the fall of Lehman Brothers sparked a worldwide crisis.

Two year zero-coupon bonds went for 4.511 percent compared to 3.408 percent.

The difference between the yields on Italian 10-year government bonds and benchmark German bonds fell after the sale however to 370 basis points -- indicating an ease in investor concern -- although the spread remained high.

Spain also paid higher borrowing rates to raise 3.225 billion euros in new short-term debt, a sign of persistent tension over its sovereign debt outlook."

..........................1A) Interest rates up as Spain sells €3.2 billion short-term debt

"Spain’s treasury has sold €3.2 billion ($4.3 billion) in two short-term debt auctions but has had to pay higher interest rates as investors continue to worry over the level of the country’s borrowings.

The treasury sold €1.6 billion Tuesday in three-month bills at a yield of 1.7 percent compared with 1.4 percent in the last such auction Aug. 23.
It sold €1.62 billion in six-month bills but again had to pay a higher interest rate of 2.7 percent. In August, the yield was 2.2 percent."

  • Other news headlines:

 

German, French economists urge 50 pct Greek debt write-down

$18,000 EACH: Ontario’s debt burden threatens serious trouble ahead

U.S. Cities Grapple With Sliding Taxes as Costs Rise, Aid Falls

Chicago given many painful ways to escape budget mess

Fukushima Desolation Worst Since Nagasaki as Residents Flee

World’s Biggest Rate Cut Forecast as Global Slump Deepens: Brazil Credit

Japan’s Vehicle Sales May Decline 14% in 2011, Automakers Group Estimates

heffe's picture
heffe
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Localized production via 3-D printing

Since the theme of localized production is big in this community, I wanted to introduce the 3-d printer.

http://www.google.com/url?sa=t&source=video&cd=1&ved=0CFQQtwIwAA&url=http%3A%2F%2Fwww.youtube.com%2Fwatch%3Fv%3DZboxMsSz5Aw&ei=iBeCTsrqGZPdiAKeiOmODQ&usg=AFQjCNF9jtByFdXUBJb5BL7WeXGppXWIRw

This technology has been around for a while now, and with it, we can manufacture anything we need using simple processes and computer programming. Here's the worlds 1st 3-D printed car http://www.google.com/search?q=worlds+first+3-d+printed+car&hl=en&biw=1024&bih=661&prmd=imvnsu&source=univ&tbm=nws&tbo=u&sa=X&ei=wBaCTteTGaTliALAq-iCDQ&sqi=2&ved=0CDgQqAI

This can help to eliminate the inefficient transportation of resources and products across the world. Using this process, most any product can be manufactured with renewable sources like bio-plastics. Have a few large-scale versions in every city, along with individual use applications.

 

Damnthematrix's picture
Damnthematrix
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"The Collapse Is Coming...And Goldman Rules The World"

Tommygun's picture
Tommygun
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Re: Collapse is coming video

DamntheMatrix,

Thanks for posting the video. I saw it on TAE. I viewed it three times  just to make sure I was hearing what I thought I was hearing. Sounds like the Great Vampire Squid known as Goldman Sachs is playing the role of banker in this game of monopoly. I will heed the advice to prepare now. Thanks for posting this for others to watch.

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plato1965
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rjs
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Judge: No Right to Produce or Eat Food

 Wisconsin: No Right to Produce or Eat Food
In scary legal news a Wisconsin judge had gone completely loopy declaring that citizens have no right to produce or eat the foods of their own choice.
 

Damnthematrix's picture
Damnthematrix
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Wall St. occupation

Wendy S. Delmater's picture
Wendy S. Delmater
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comments

Middle Class Welfare State? jdargis - isn't that an oxymoron? (Maybe not in Greece...or parts of the USA)

The living bridge story is amazing.

One of my editors at the magazine I run has a 3-d printer. Her daughter the scientist got it for her, and they are just learning to use it. They may become inportant in the future.

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pinecarr
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Tommygun
Tommygun wrote:

DamntheMatrix,

Thanks for posting the video. I saw it on TAE. I viewed it three times  just to make sure I was hearing what I thought I was hearing. Sounds like the Great Vampire Squid known as Goldman Sachs is playing the role of banker in this game of monopoly. I will heed the advice to prepare now. Thanks for posting this for others to watch.

+1 Yeah, that's one strange video to watch, especally from the persepctive that it is presented.  Thanks for posting, DTM.

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Tommygun
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Re:Ooops

Good research Plato1965. That BBC trader and his words seemed credible. But his track record appears otherwise. I am going to have to get me a suit and tie. ( Although I still think the euro is in for long term trouble.)

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heffe
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Trader and his comments......
Damnthematrix wrote:

 

What most struck me about this video was the way the independent trader referred to his position as an investor.

Comments like, "It not my job to care about what happens, it my job to make money from it"

Absolute insanity.

This is a demonstration of our cultural obsession manifested through the profit paradigm. His position is to make money off of money, and nothing else. He is even rewarded with high social status for his career choice. The world is soon to eat itself alive and his calm, blissful state assumes that if he's 'prepared' to make money off the downward market cycle, he will be fine.

Unfortunately, there's a term called 'symbiosis', and its meaning suggests that everything is connected. He may increase his paper wealth with strategic placements of assets and shorting future's, but if the world is to collapse to the degree he posits, his life will be ruined regardless.

A great quote, from the Occupy Wall St. demonstrations. "Soon enough, the poor will have nothing left to eat but the rich."  What is sad to me is this is not an inevitable consequence, its merely a manifestation of inefficient, outdated economic models, of which are entirely changeable.

 

Damnthematrix's picture
Damnthematrix
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ooops..
Tommygun wrote:

Good research Plato1965. That BBC trader and his words seemed credible. But his track record appears otherwise. I am going to have to get me a suit and tie. ( Although I still think the euro is in for long term trouble.)

His credibility is shot because "he has no money in the bank and no mortgage"?  Makes him a smart man methinks.....  no mention of how he invests his money either.

ezlxq1949's picture
ezlxq1949
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Re: The Collapse is Coming

Whatever he is, I like what the Telegraph reporter wrote:

"So he's more of a talker than a trader. A man who doesn't own the house he lives in, but can sum up the financial crisis in just three minutes – a knack that escapes many financial commentators"

Johnny Oxygen's picture
Johnny Oxygen
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Damnthematrix wrote:
Damnthematrix wrote:

The weirdest part of this story is that the BBC talking head's "jaws were dropping" at what he said.

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BBC Releases Official Statement On Alessio "The Trader" Rastani

http://www.zerohedge.com/news/bbc-releases-official-statement-alessio-tr...

Zero Hedge's post yesterday of a trader telling the BBC how he (and everyone else) really feels about the current cataclysmic situation, went viral, and as of this writing, was about to generate 100,000 hits (legit ones: no slideshows were massacred in the creation of a some CPM abortion). Needless to say, the trader in question, Alessio Rastani, very suddenly and violently entered the public's eye, the most amusing side effect of which was the emergence a fringe group claiming that just because he looks like some other guy, that he is a spoof, and this was immediately used by the conventional media to attempt to discredit him. And as usually happens, this has backfired. The BBC has just released a statement confirming that Rastani is, indeed, a trader, and that all those (Forbes) who have nothing better to do than to attack the messenger and not the message, may be better advised to taking a Math 101 class and realizing why we are all scroomed, instead of polishing their character assassination skills. To everyone else who attempted to marginalize Rastani, "suck it" is not exactly what we would like to say, but it sure does the job. And to that we would like to add that just because Larry Summers is a spitting image of Jabba the Hut, that does not make him an automatic member of the "Tattoine Men" comedy troupe.

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dingalls
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ezlxq1949 wrote: Whatever he
ezlxq1949 wrote:

Whatever he is, I like what the Telegraph reporter wrote:

"So he's more of a talker than a trader. A man who doesn't own the house he lives in, but can sum up the financial crisis in just three minutes – a knack that escapes many financial commentators"

I agree with this, it sounded good.  Although I would not agree that he summed up the financial crisis.  He certainly had an interesting message.

Damnthematrix's picture
Damnthematrix
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Was the BBC victim of a hoax?

Was the BBC victim of a hoax? No, say the Yes Men

(BBC)

"Governments don't rule the world, Goldman Sachs rules the world."

That's what a purported London-based independent trader named Alessio Rastani told the BBC on Monday in a jaw-dropping interview that quickly went viral.

But just as quickly, rumors swirled that Rastani was actually a member of the Yes Men, a loose-knit group of merry pranksters and imposters that attempt to manipulate the media with the goal of exposing the dubious conduct of big corporations.

The Yes Men publicly denied that Rastani is a member. And the BBC said in a statement that it doesn't think he is, either: "We've carried out detailed investigations and can't find any evidence to suggest that the interview with Alessio Rastani was a hoax. He is an independent market trader and one of a range of voices we've had on air to talk about the recession."

"We've never heard of Rastani," the group said in a statement of its own. "He isn't a Yes Man. He's a real trader who is, for one reason or another, being more honest than usual."

Rastani has an active Twitter feed, Facebook account and blog--all consistently updated. And Rastani gave an extensive interview to Forbes insisting he is who he says he is--an independent trader who works from his South London home.

Felix Salmon of Reuters has another theory: that Rastani, who bears a striking resemblance to a member of the Yes Men, is both a trader and member of the troupe.

"Independent traders are, well, independent," Salmon noted. "You don't need to spend very much time hanging around the comments section at Zero Hedge to discern a strong nihilistic and even anti-capitalist strain to much of the thinking in that community. Independent traders are often men in their 20s and 30s who inherited a substantial sum of money and who for whatever reason don't have a more attractive opportunity in the regular workforce. They work from home, they tend to have a strong contrarian streak, and they have a lot of time on their hands.

"All of which is entirely consistent with the profile of the kind of people who might join or become the Yes Men," Salmon added.

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jumblies
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diamarie wrote: ezlxq1949
diamarie wrote:
ezlxq1949 wrote:

Whatever he is, I like what the Telegraph reporter wrote:

"So he's more of a talker than a trader. A man who doesn't own the house he lives in, but can sum up the financial crisis in just three minutes – a knack that escapes many financial commentators"

I agree with this, it sounded good.  Although I would not agree that he summed up the financial crisis.  He certainly had an interesting message.

Looking at this chap's website it strikes me that he is indeed a trader (no idea how successful) which makes me think the telegraph article was more like damage control than anything. I just think it unlikely this chap would flat out say he's not a trader but instead just an attention seeker. And that he would talk about his mortgage and in whose name it is. I mean, would you tell some random person from the media? And why does the article attack the man and not examine the veracity of what he said? Just sounds wrong, to me. And as the zerohedge article pointed out, the BBC confirmed he was a trader and the Yes Men confirmed he was not one of them.

And then even putting his own personal position aside, from my own research and readings what he said is inline with my findings. Which suggests to me again that the telegraph article was damage control.

Either way, perhaps this will cause people to sit up and take notice and that would be a good thing. Ok, wishful thinking.

 

VeganDB12's picture
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Love the trader video. 

Love the trader video.  Funny that it got on the BBC.  Perhaps the trader looks more successful than he is but I have no issue with what he said about traders motives. Living near New York, you get to meet these people.  Many of them (obviously not all) living middle class lives. Obviously the big league HFT players are a different story, the successfull hedgefund guys too, they are much bigger market movers I guess.   But a lot of traders are just trying to feed their kids.   He is losing money in the market so when he says "you can make money" in this market I assume he is referring to the big insiders like Goldman.   He is not the only trader losing money right now.

What's wrong with telling people to protect their assets?  The Telegraph disclaimer seems unconcerned with the message and the good advice he did give.

 

 

 

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heffe
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BBC video, Assets, and paradigms
Denise2257114 wrote:

Love the trader video.  Funny that it got on the BBC.  Perhaps the trader looks more successful than he is but I have no issue with what he said about traders motives. Living near New York, you get to meet these people.  Many of them (obviously not all) living middle class lives. Obviously the big league HFT players are a different story, the successfull hedgefund guys too, they are much bigger market movers I guess.   But a lot of traders are just trying to feed their kids.   He is losing money in the market so when he says "you can make money" in this market I assume he is referring to the big insiders like Goldman.   He is not the only trader losing money right now.

What's wrong with telling people to protect their assets?  The Telegraph disclaimer seems unconcerned with the message and the good advice he did give. 

 

It wasn't the advice that I found disturbing. I agree with him that the world is 'owned' and I had nothing against his calls for asset protection. 

It was the terminolgy he used to describe his position that I found disturbing. To me it illuminates a very key cultural context that we all need to understand.   He stated something along the lines of "I am a trader, its not my job to care about all the people that are going to be affected, its my job to make money."  This is logical within the lense of a monetary world, but what about the physical world?  Ya know, the planet and its resources that we depend on?  How does this mindset of 'profit and nothing else' fit into the ecosystem's we depend on?

John McCurty, author of "The Cancer stage of Capitalism", has a well articulated method of evaluating this characteristic in the trader's mindset.

Basically, as the 'money sequence of value' decouples from the 'life sequence of value' the monetary-market system becomes more cancerous and self destructive.   The trader doesnt actually produce anything, he merely makes money off money.  More people will do this, my best friend and his father have been living of the Nasdaq for years (barely).  I don't blame them for doing so, I just see it as a demonstration that our monetary economies are becoming more detached from its life host; the people and the planet.  There are fewer jobs, so people resort to creating money out of money through stock options, etc. 

To me the whole aspect of the stock market is madness. We allow the pricing of necessary, life giving commodities to be controlled by a small number of elite corporations/hedge fund managers/etc.  Basically we are allowing a top-down hierarchical control of our resources through the monetary paradigm.  The livelihood of billions is influenced by a few super greedy, elitists individuals.  We need to end this parade of insanity called the monetary-market system before it ends us.

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Tall
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It is disturbing - a highstakes game for all of us

"We need to end this parade of insanity called the monetary-market system before it ends us."

Amen.

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Ending the top-down hierarchical control of our resources...

 Basically we are allowing a top-down hierarchical control of our resources through the monetary paradigm.  The livelihood of billions is influenced by a few super greedy, elitists individuals.  We need to end this parade of insanity called the monetary-market system before it ends us.

At least with the current system there is an attempt at price discovery. Imagine what it would be like if we didn't have any of these indicators. You wouldn't know that the price of commodities, gold silver etc is increasing. It would be far worse than what is currently happening.

If people became more aware and educated on how to manage ones money - then they could allocate it in ways that avoid the influence of top-down hierarchical control.

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heffe
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Price mechanisms via fiat/gold currency
johnbryson wrote:

 Basically we are allowing a top-down hierarchical control of our resources through the monetary paradigm.  The livelihood of billions is influenced by a few super greedy, elitists individuals.  We need to end this parade of insanity called the monetary-market system before it ends us.

At least with the current system there is an attempt at price discovery. Imagine what it would be like if we didn't have any of these indicators. You wouldn't know that the price of commodities, gold silver etc is increasing. It would be far worse than what is currently happening.

If people became more aware and educated on how to manage ones money - then they could allocate it in ways that avoid the influence of top-down hierarchical control.

I think its more akin to how money creation is handled.  I believe that both fiat and gold standards should be outgrown, and a new system of energy accounting should be used as a price mechanism. This way price is reflected in the amount of energy needed to create the good, rather than profit interest, manic bubbles, or elite influence.

There is also the advantage of removing centralized monetary systems, as energy accounting would base its parameters off well established electrical/energy properties like watteage and amperage, allowing individual communities to create currency as they extracted energy.

With our debt based currencies, we allow them to create artificial scarcity, as well as, top-down control over our exchange commodity.

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