Daily Digest

Daily Digest - May 17

Monday, May 17, 2010, 9:45 AM
  • The West Is Facing A Debt Crisis And It's Now Or Never For The American Empire
  • Euro Rescue Package 'Just Buys Time': Merkel
  • Speedy New Traders Make Waves Far From Wall Street
  • Fears Intensify That Euro Crisis Could Snowball
  • Giant Plumes of Oil Forming Under the Gulf
  • Gulf Oil Leaks Could Gush for Years

Economy

The West Is Facing A Debt Crisis And It's Now Or Never For The American Empire (Video) (sammy)

Historian Niall Ferguson spoke with the Big Think about where the world's future is heading, with the end of the American Empire very much in the cards.

Euro Rescue Package 'Just Buys Time': Merkel (mhoop)

Speaking at a conference of the Confederation of German Trade Unions, Merkel said that recent speculation against the euro "is only possible because of huge differences in the economic strengths and debt levels of member states."

Speedy New Traders Make Waves Far From Wall Street (jdargis)

After the brief 1,000-point plunge in the stock market that day, the growing role of high-frequency traders in the nation’s financial markets is drawing new scrutiny.

Over the last decade, these high-tech operators have become sort of a shadow Wall Street — from New Jersey to Kansas City, from Texas to Chicago. Depending on whose estimates you believe, high-frequency traders account for 40 to 70 percent of all trading on every stock market in the country. Some of the biggest players trade more than a billion shares a day.

Fears Intensify That Euro Crisis Could Snowball (jdargis)

In a sign of the depth of the anxiety, the euro fell Friday to its lowest level since the depth of the financial crisis, as investors abandoned the currency as well as stocks in favor of gold and other assets seen as offering more safety.

Environment

Giant Plumes of Oil Forming Under the Gulf (Bill S.)

Scientists are finding enormous oil plumes in the deep waters of the Gulf of Mexico, including one as large as 10 miles long, 3 miles wide and 300 feet thick in spots. The discovery is fresh evidence that the leak from the broken undersea well could be substantially worse than estimates that the government and BP have given.

Gulf Oil Leaks Could Gush for Years (mhoop)

Last week the joint federal-industry task force charged with managing the spill tried unsuccessfully to lower a 93-ton containment dome (pictures) over one of three ruptures in the rig's downed pipe.

Crystals of methane hydrates in the freezing depths clogged an opening on the box, preventing it from funneling the spouting oil up to a waiting ship.

Please send article submissions to: [email protected]

22 Comments

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Re: Daily Digest - May 17

"May 17 (Bloomberg) -- The euro will be on par with the U.S dollar “sooner or later” as the region’s debt crisis worsens, according to Christopher Wood, chief equity strategist at CLSA Asia Pacific Markets."

"Gold prices may reach at least $3,500 in the “bull market” for the commodity, according to Wood, three times more than the current value.

“The minimum target for gold in this bull market is $3,500,” Wood said. “Gold will go parabolic when the dollar ceases to become reserve currency.”"

"May 17 (Bloomberg) -- Europe’s sovereign debt crisis is prompting some of the Treasury market’s biggest bears to reverse calls for Federal Reserve interest-rate increases this year.

Morgan Stanley, Wrightson ICAP and Pierpont Securities LLC say the Fed will keep interest rates near zero percent after the European Union unveiled an almost $1 trillion loan package to halt a slide in the euro and local bonds that threatened to shatter the currency union. Futures show traders place a 40 percent likelihood that the central bank will raise borrowing costs by December, down from 73 percent a month ago."

"The pound plunged to a 14-month low against the dollar on Monday as fears escalated over the UK government’s financial position.

Sterling fell after George Osbourne, the UK’s new chancellor, told the Financial Times that the former Labour government had “fiddled” forecasts in order to allow it to present the sort of spending plans that “it wanted to present”.

Concerns over the UK’s record fiscal deficit also heightened on reports that the new UK government had accused the previous Labour administration of pursuing a “scorched earth policy” before the general election, leaving behind billions of pounds of previously hidden spending commitments.

The reports raised fears that the UK could experience heightened difficulties in raising funds in the market in the future."

"May 17 (Bloomberg) -- Money markets are showing rising levels of mistrust between Europe’s banks on concern an almost $1 trillion bailout package won’t prevent a sovereign debt default that might trigger a breakup of the euro.

Royal Bank of Scotland Group Plc and Barclays Plc led financial firms punished by rising borrowing costs, British Bankers’ Association data show. The cost to hedge against losses on European bank bonds is 63 percent higher than a month ago. Investment-grade corporate debt sales in the region plummeted 88 percent last week to $1.2 billion from the previous period, according to data compiled by Bloomberg. "

.....................4A) Corporate Bond Risk Rises in Europe, Credit-Default Swaps Show

"The euro750 billion ($1 trillion U.S.) shock-and-awe rescue package to prevent the Greek debt crisis from spreading only bought eurozone countries more time, it didn't solve their underlying debt problems, German Chancellor Angela Merkel and a European Central Bank official said Sunday. "

"Ms. Merkel also told union members that budget cuts in Germany are inevitable, calling the country's own current debt level unsustainable. "

"NEW YORK (CNNMoney.com) -- For the fourth time this year, doctors face a potential huge cut in the fees that the government pays them to treat Medicare patients.

Physicians will be hit with a 21% cut in Medicare reimbursements as of June 1, unless lawmakers decide to patch over the issue -- as they've done for years. Congress is now debating the matter, and to stop the cut lawmakers would have to vote to pass a new patch sometime in the next two weeks."

"One possible outcome of the congressional wrangling is a five-year delay in the 21% cut in Medicare fees. That option, the most-discussed so far, would cost about $80 billion.

That spending would be exempt from a "pay as you go" law enacted in February that requires lawmakers to find ways to offset certain spending increases or tax cuts."

"ALBANY -- Gov. Paterson has put massive state employee layoffs "on the radar screen" after being told the no-layoff pledge he signed with public employee unions last year is not legally binding, The Post has learned.

The administration has estimated that up to 10,000 job cuts would be needed to reach the governor's target, an official said.

Paterson's new tack follows a federal court ruling last week that temporarily blocked his $30 million-a-week plan to put 100,000 workers on furlough."

"LONDON (MarketWatch) -- The cost of insuring non-core euro-zone government debt against default rose again Monday on growing fears about the depth of the region's financial crisis. The spread on Greek credit default swaps widened to 625 basis points, up from 600 basis points at Friday's close, according to Markit. That means it would cost $625,000 a year to insure $10 million of Greek debt against default, up $25,000 from Friday. The Spanish CDS spread rose to 185 basis points from 179, while the Portuguese spread widened to 255 from 242, Markit reported. Italy was 2 basis points higher at 142. CDS spreads for European banks widened in tandem with sovereign debt, Markit said."

"LEWISTON - The Idaho Department of Health and Welfare is suspending Medicaid payments to certain providers until the first week of July.

The announcement came after the department discovered the Medicaid program will fall short of the state general fund requirements by millions of dollars.

"It's not something that we want to do," said District 1 & 2 Operations Manager Ron Beecher. "Over the years we've been able to be very prompt. Last year because of budget concerns we had to delay the payments by a week. This year the budget shortfall that we're looking at is about $133 million and that's very significant."

"SACRAMENTO (MNI) - The Investment Committee of the California Public Employees' Retirement System is reviewing forecasts of capital market returns Monday and in preparation for the discussions, the staff's documents suggest looking at leveraged bonds to reduce equity risk and improve returns.

That alone indicates the staff might have some concern about the risk profile of Calpers' portfolio allocation.

In documents in preparation for Monday's investment committee meeting and subsequent public workshop, the staff also suggests Calpers might have to settle for a rate of return of its asset investments of less than 7.75%, which is the currently assumed rate of return.

"Return forecasts are lower and could result in expected portfolio returns lower than 7.75% going forward for current policy," the staff wrote.

The documents also note that, "Equity risk premium and private equity premium have been key drivers of the Calpers portfolio, but are forecast to be lower." "

"San Francisco's escalating yearly tab for pension costs for city workers could hit nearly $700 million in 2014 - an amount larger than the current annual operating budget for San Francisco General Hospital.

This year, the city contribution is less than $300 million, officials said.

City voters next month will be asked to change pension rules by shifting more of the funding burden onto city workers and away from the government treasury to save taxpayers between $300 million and $500 million cumulatively over the next 25 years, according to an analysis by the city controller. "

"Harrisburg is insolvent. Our obligations exceed our assets. Despite passing a $64.7 million general fund budget, we will be fortunate if we collect $57 million in revenue this year.

We began 2010 with a deficit of $7.7 million that must be addressed. Our insolvency becomes more glaring when we add the $68 million of guaranteed debt service payments required to pay for Harrisburg Authority debt. "

"NEW ORLEANS (AP) -- BP said Monday it was siphoning more than one-fifth of the oil that has been spewing into the Gulf for almost a month, as worries escalated that the ooze may reach a major ocean current that could carry it through the Florida Keys and up the East Coast.

BP PLC chief operating officer Doug Suttles said Monday on NBC's "Today" that a mile-long tube was funneling a little more than 1,000 barrels -- 42,000 gallons -- of crude a day from a blown well into a tanker ship. The company and the U.S. Coast Guard have estimated about 5,000 barrels -- 210,000 gallons -- have been spewing out each day. Engineers finally got the contraption working on Sunday after weeks of failed solutions -- however, millions of gallons of oil are already in the Gulf of Mexico."

"(Reuters) - People are hoarding food. Schools and businesses have closed. Hotels are pleading for guests to leave. Across Bangkok, residents worry about escalating violence that has killed 37 people and wounded hundreds in four days."

......................14A) U.S., UK issue warnings on Bangkok and Thai Baht, Stocks Decline, Bond Risk Rises as Clash Worsens and Thailand Sets Mid-Afternoon Deadline to Evacuate Protest Site

"Defense Secretary Robert M. Gates has vowed to impose fiscal austerity at the Pentagon, but his biggest challenge may be persuading Congress to go along.

Lawmakers from both parties are poised to override Gates and fund the C-17 cargo plane and an alternative engine for the F-35 Joint Strike Fighter -- two weapons systems the defense secretary has been trying to cut from next year's budget. They have also made clear they will ignore Gates's pleas to hold the line on military pay raises and health-care costs, arguing that now is no time to skimp on pay and benefits for troops who have been fighting two drawn-out wars."

"(Reuters) - The U.S. economy has begun to climb out of the worst downturn since the 1930 Great Depression but still needs additional steps by the federal government to stem a crisis in the job market, a senior economic adviser to President Barack Obama said on Sunday."

"Romer urged Congress to a pass a series of measures Obama has proposed to jump-start growth, including the establishment of a lending fund to spur credit to small businesses and providing cash-strapped cities and states with aid to help them avoid layoffs of teachers and other local employees.

With the U.S. unemployment rate just under 10 percent, the Obama administration is juggling the need to spur economic growth with pressure to rein in ballooning U.S. budget deficits.

Obama has named a bipartisan fiscal commission that will report back by December 1 with recommendations for curbing the deficit, which is projected to hit $1.6 trillion this year."

"Dr. Robert R. Urzillo, Conrad Weiser School District superintendent, sees what's coming, and it's not good.

In the next few years, the amount his district - and districts across the state - will need to pay into the Pennsylvania School Employee Retirement System will skyrocket.

After increasing 4.78 percent for this school year, it will jump another 8.22 percent next year. For the 2012-13 school year, the increase will soar to 29.22 percent.

By 2014-15, Conrad Weiser payments into the pension system could top $3.2 million, over five times more than now.

"Obviously, such a dramatic spike will have devastating impacts for schools and taxpayers," Urzillo said. "This is a crisis. This really is."

What to do about a grossly underfunded state pension system is one of the biggest issues facing Pennsylvania. If nothing is done, local school officials said, it will cripple districts or force severe tax hikes."

"Britain’s official public debt could double to almost £1.8 trillion pounds if the new government proceeds with plans to bring soaring private finance initiative (PFI) and pension liabilities onto the national accounts, experts have warned.

The move, being considered by chancellor George Osborne as part of his wide-ranging ‘audit’ of all public spending, includes plans to bring council PFI and town hall pension costs onto the national accounts to improve the transparency of future government finances.

Councils, and other local public bodies, have entered into a huge number of PFI-style projects for services such as libraries, roads programmes, schools and hospitals – and would contribute billions of pounds to more transparent borrowing figures.

But experts have warned that Britain risks undermining its economic recovery if it chooses to reveal levels of public debt far greater than the official figures currently show. Some experts within the City of London are concerned that Mr Osborne’s plan could undermine Britain’s cherished AAA credit rating, sparking fears of crucial international investment withdrawals."

"April tax collections are falling short of forecasts and even dropping below last year's depressed levels in a number of states, complicating budget troubles and prompting some governors to dip into rainy-day funds.

Following several months of modest improvement, the weak April revenue numbers are disappointing for states that hoped for economic recovery soon.

Based on reports from more than a dozen states, the figures suggest the recession may have taken a heavier-than-expected toll on employment last year, cutting into income taxes.

The shortfalls also are punching fresh holes in state budgets. Widening state deficits could in turn put pressure on the federal government to issue new stimulus funding; a 2009 cash injection from Washington has helped shore up battered state finances, but much of that will dry up by the end of this year.

April is the biggest revenue month for many states because it is when they collect a large portion of income taxes. The month's collections came up short of expectations in California by 26.4%, or $3.6 billion; in Pennsylvania by 11.8%, or $390.1 million; and in Kansas by 10.2%, or $65.3 million. More states will report in the next few weeks."

 

  • Other news stories and headlines: 

Euro Falls to Lowest Since April 2006 on European Debt Crisis

Ron Paul's On Coming Hyperinflation (Youtube)

Greece to Get First EU Loans Tomorrow, Official Says

China Stocks Plunge Most Since August on Property Curbs, Europe and Chinese stocks slump over 5%, fall to year low

Series of lawsuits could cost Dallas $1 billion

Italy minister says no decision on cuts: report and Italy eyes €27.6 billion cuts to avoid debt crisis

Euro debt fears, ETF drive change in gold buying

New Univ. of Illinois president facing $375 million budget gap

Greek fiscal plan needs stimulus back-up -Papandreou

Debt-to-GDP ratio to rise to 58.4% (Philippines)

Survey shows risk of US municipal defaults

Real Estate: Commercial agents report earnings down by a third

Municipal Bonds: Derailed

Fresno wants homeowners to take over pruning

Florida Prison Population: Growing by Leaps and Bounds (Editorial)

Syracuse University grads warned at commencement to expect tough job market

idoctor's picture
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Re: Daily Digest - May 17

Credit Card Delinquencies Fall Again in April

http://www.cnbc.com/id/37189587

U.S. credit card delinquencies fell for the fourth straight month in April, the latest indicator that Americans are recovering from the worst economic downturn since the Great Depression.

Credit Card swipe

In regulatory filings on Monday, Capital One Financial, Discover Financial Services and  Bank of America's reported lower credit card delinquency rates, a sign that fewer borrowers will default on their card debts in the coming months.

Default rates, while still high, declined for Capital One and Discover to their lowest levels this year. Bank of America, the largest U.S. card issuer, reported an increase in defaults.

The card data is released monthly by the major U.S. credit card issuers and is a key barometer for American consumers' financial health.

While charge-offs — debts the companies do not expect to be repaid — remained high, delinquencies are a better gauge of future loan performance. With fewer consumers late on their bills, the outlook for credit losses over the summer may be improving.

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Re: Daily Digest - May 17

Good discussion from Stoneleigh at The Automatic Earth:

"There is a limit to credit expansion, as there is to every ponzi scheme. Eventually the debt created can no longer be serviced, the biggest sucker has been fleeced, expansion can no longer continue and we see the implosion of the structure, where the excess claims to underlying real wealth are messily and rapidly extinguished. The virtual wealth disappears. That is deflation."

http://theautomaticearth.blogspot.com/2010/05/may-16-2010-oil-credit-and...

 

 

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Re: Daily Digest - May 17

BP will only implement measures that allow them to recoup their losses and sell more oil from this well, so what if 80 percent still leaks into the ocean as long as they can sell 20 percent of it?. This gusher can and should be plugged. It is unconscionable to do otherwise. JMHO.

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Re: Daily Digest - May 17

The latest from Jim Cramer:

Why everyone should own gold 

So what do ya all think... does this mean that even he can get it right some of the time, or instead that we should be selling all our shiny yellow stuff?  Wink

- Nick

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Re: Daily Digest - May 17

Cramer has never been right about anything, so far as I can tell. I take this as a strong sell signal. Seriously.

Erik

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Re: Daily Digest - May 17
Erik T. wrote:

Cramer has never been right about anything, so far as I can tell. I take this as a strong sell signal. Seriously.

Erik

either that or he's worried about someone putting a rope round his neck (metaphorically speaking) when this thing finally goes due south.  He's certainly an idot but I can't decide on how stupid he is..................

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Re: Daily Digest - May 17
Erik T. wrote:

Cramer has never been right about anything, so far as I can tell. I take this as a strong sell signal. Seriously.

Erik

OR it COULD be a double-fake to make those of us who are bullish on gold THINK gold's going to go down, 'cuz Cramer's backing it, when it really IS going to go up....:)

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Re: Daily Digest - May 17
pinecarr wrote:
Erik T. wrote:

Cramer has never been right about anything, so far as I can tell. I take this as a strong sell signal. Seriously.

Erik

OR it COULD be a double-fake to make those of us who are bullish on gold THINK gold's going to go down, 'cuz Cramer's backing it, when it really IS going to go up....:)

stop it Stop It STOP IT!!!  Make the pain STOP!  Tongue out

"Ever see that scene in Scanners when that dude's head blew up?"   -Wayne's World

- Nick

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Re: Daily Digest - May 17

BP is planning to capture 100%, the 6 inch pipe was a test to see if they could insert a tube to recover the leaking oil. The problem is that need to make a mile long tube with a large enough diameter to take up the entire volume of oil, or they need to come up with another solution. Since no one stocks Hose with 21" diameter with lengths exceeded 1 mile, they have no choice but to use what they have for now: a 6 inch hose. Anyone  have a spare 21" diameter hose that is at least a mile long? Please call BP!

BP is concerned that some options to stop the leak will rupture the damage pipes causing an even greater flow rate. For instance jamming up the pipe would just cause the oil to flow out of one of the other 2 pipe breaches and may cause a pipe rupture that would increase the flow rate. The need a method to siphon off the flow.

I suspect that they won't be able to fix the problem until the relief well is completed in a month or two. Then they should be able to manipulate the damage well head to seal the flow permanately after thr relief well drilling is completed

 

 

 

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Re: Daily Digest - May 17
VeganD wrote:

BP will only implement measures that allow them to recoup their losses and sell more oil from this well, so what if 80 percent still leaks into the ocean as long as they can sell 20 percent of it?. This gusher can and should be plugged. It is unconscionable to do otherwise. JMHO.

Having worked a few years in the maritime industry, I can honestly promise you that BP will be trying whatever it can to contain the leak.  Plugging it wouldn't render the oil field unuseable, since they could drill other wells elsewhere over the field (I drink your milkshake!).  So plugging this particular well is not something they are unwiling to do.   

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Re: Daily Digest - May 17

Huge swell sinks wave energy generator

http://www.abc.net.au/news/stories/2010/05/17/2901059.htm

Australian firm leading wave energy tech

The 170-tonne structure was officially launched in March. (7pm TV News NSW)

A wave energy generator which was launched off the New South Wales south coast in March, has sunk in rough seas.

The 170-tonne structure had been providing electricity to the grid from 150 metres offshore at Port Kembla.

But it broke free from its pylons on Friday afternoon and sank on Saturday.

Early efforts to tow the barge to safety were abandoned due to the rough conditions.

The Chief Executive Officer of the Port Kembla Ports Corporation, Dom Figliomeni, says the structure was battered against the break water.

He says attempts to retrieve the barge will be made this week.

"There's been no impact on the provision of services to shipping and where it is at the moment it's not a navigation hazard," he said.

"We will continue to monitor its location."

The generator's Sydney-based developer, Oceanlinx is investigating what happened.

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Re: Daily Digest - May 17

"So plugging this particular well is not something they are unwiling to do."

 

They can't just "plug"  the well.  The oil and gas is under tremendous pressure and would blow out any plug.  

In fact, the accident happened while they were trying to "plug the well".  The drill rig had completed it's drilling and the well was being plugged (by Haliburton) with two concrete plugs placed into the drill shaft.  The drill rig would then move off and a production rig put in it's place.  The production rig would drill out the concrete plugs when they were set with the harvest pipes to collect the oil and gas.  

I think any solution is going to involve trying to collect the oil coming out under pressure and move it to a tanker on the surface.  All the solutions BP has put forward to this point seem to involve that process.  

 

 

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Re: Daily Digest - May 17

Miners warned Chinese growth can't last forever

By China correspondent Stephen McDonell

http://www.abc.net.au/news/stories/2010/05/18/2902297.htm?section=justin

There is worrying news for Australia and other nations that rely on China's breakneck economic growth.

Some economists are predicting the pace cannot be sustained and fallout is inevitable unless China can pull off major shifts in its economy.

Demand from places like the massive Waigaoqiao Shipyard on the outskirts of Shanghai have dragged China and Australia through the world economic crisis.

The shipyard employs 20,000 workers and every two weeks it produces a new megaship the size of an oil tanker.

But chief engineer Tao Ying is aware of the problems of overcapacity in his industry.

He recognises that many more ships are being built than are needed internationally.

"If the world's economy keeps on going down, our overcapacity will become huge," he said.

"Some enterprises might withdraw from the market and stop making ships altogether."

China's heavy reliance on exports in the current climate has led to predictions that its huge demand for Australian raw materials might last a little bit longer.

But Peking University's Professor Michael Pettis, a leading expert on the Chinese economy, says demand will have to reduce at some point.

"I would guess that this year is going to be a good year for growth," he said.

"I would say there is at least a 50 per cent probability that next year will also be a very good year for growth and after that the probability of yet another year goes down quite dramatically."

He says Australian iron ore companies should certainly not be counting on good iron ore sales indefinitely into the future.

"I would be even more worried than that because one of the things that has been happening is that it seems like China has been stockpiling quite a lot of commodities," he said.

"If Chinese growth slows down and the rest of the world doesn't take off again, then we also have to worry about the possibility these stockpiles of commodities in China start selling off."

Trade Minister Simon Crean is in Beijing for high-level talks with Zhang Ping, the chairman of China's powerful National Development and Reform Commission.

The ABC asked him if he was worried China could be already producing more goods than it can sell.

"I think China understands better than anyone the importance of it being sustainable," he said.

It is generally agreed that for China to escape a major downturn in production, it needs to boost domestic demand as a proportion of GDP.

That will mean getting Chinese people to stop putting so much money away for a rainy day and convincing them instead to go out and spend it.

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Re: Daily Digest - May 17
imagesbytjm wrote:

"So plugging this particular well is not something they are unwiling to do."

 

They can't just "plug"  the well.  The oil and gas is under tremendous pressure and would blow out any plug.  

 

I think that is certainly a clear concern, yes, although the "junkshot" idea involves ultimately plugging the well if it works.  But my point was really to the previous poster, who believed they can and should just plug the well and call it a day, but won't because of the villainous nature of all folks associated with the oil industry.  That is not the case.  I am confident that no one at BP is against plugging the well simply because it would result in lost profits.

 

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Re: Daily Digest - May 17

Duh Earth to BP.  Get a plumber. I would try a bell reducer with a compression fitting bringing it down from 21" to 6". Therefore on need for a mile of 21" pipe

But maybe I am missing something. 5k feet is a long way down.

V

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Re: Daily Digest - May 17
V wrote:

Duh Earth to BP.  Get a plumber. I would try a bell reducer with a compression fitting bringing it down from 21" to 6". Therefore on need for a mile of 21" pipe

But maybe I am missing something. 5k feet is a long way down.

At those pressures physics works a lot differently than what we're use to.  It may not be that simple. 

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Re: Daily Digest - May 17

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Re: Daily Digest - May 17

imagesbytjm wrote:

 

"So plugging this particular well is not something they are unwiling to do."

 

They can't just "plug"  the well.  The oil and gas is under tremendous pressure and would blow out any plug.  

 

dave s wrote: 

I think that is certainly a clear concern, yes, although the "junkshot" idea involves ultimately plugging the well if it works.  But my point was really to the previous poster, who believed they can and should just plug the well and call it a day, but won't because of the villainous nature of all folks associated with the oil industry.  That is not the case.  I am confident that no one at BP is against plugging the well simply because it would result in lost profits.

I certainly appreciate dave s' comments.  I too, have worked in the oil and gas drilling and I can attest that there is zero incentive for any oil company to have accidents / blowouts.  They are obviously very UNPROFITABLE.  

Seeing all the arm-chair experts making judgments about the spill based on what the MSM reports demonstrates short-sightedness if not outright deliberate ingnorance.  Most statments I hear reflect a complete lack of knowledge of the business.  It is politically popular to bash the business.  People need to take a breather and stop demonizing the people in the oil/gas industry. 

Folks on this forum should know better than anybody how oil supports our civilization.  Those folks out there in the gulf should be encouraged in their efforts and I can say to everyone reading this - I am greatly impressed and amazed at what they have been able to acomplish under the circumstances and in less than a month !!!!!   Only those who have spent time in the oil fields know the difficulties of the business and what they are doing is impressive. 

The spill is monstrous and very unfortunate and there is probably some negligence somewhere.   However, the media and public are in large part acting as though BP did it on purpose.  That is not the case at all.   What is done is done.  We learn from it and move on.  It is miraculous more accidents don't happen - it is that dangerous!!  Even when everything is done right, and everything works perfectly - blowouts can and have occurred despite our best efforts. 

So to those who hate the oil companies - prove yourself by throwing out the plastic bottles you drink your water from  and stop driving on asphalt and do not cook or heat your home and throw out the computer you art using to read this and stop taking any number of medications and toss most of your synthetic clothes, etc.....   Count your blessings and thank God for that the accident was not worse and that they are making progess containing it so soon...

Bruce Cool

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Re: Daily Digest - May 17
Lordson wrote:

So to those who hate the oil companies - prove yourself by throwing out the plastic bottles you drink your water from  and stop driving on asphalt and do not cook or heat your home and throw out the computer you art using to read this and stop taking any number of medications and toss most of your synthetic clothes, etc.....  

That's the real problem IMO... most people just don't get that.

Lordson wrote:

Count your blessings and thank God for that the accident was not worse and that they are making progess containing it so soon...

But I find that a poor consolation... At some point, we will all have to make a conscious choice on how far we are willing to destroy our environment..

Samuel

mono's picture
mono
Status: Martenson Brigade Member (Offline)
Joined: Nov 13 2008
Posts: 70
Re: Daily Digest - May 17

The Niall Ferguson video is quite brilliant.

idoctor's picture
idoctor
Status: Diamond Member (Offline)
Joined: Oct 4 2008
Posts: 1731
Re: Daily Digest - May 17

I don't know but I am keeping mine for a while longer.

Gold Investors Should 'Rush to the Exits': Dennis Gartmanhttp://www.cnbc.com/id/37209570

 Investors should get out of gold immediately as the metal reaches a technical top and is due for a pullback, says Dennis Gartman, hedge fund manager and author of The Gartman Letter.

Gold Bars
AP

In his daily note to clients, Gartman advises them to "rush to the exits" as gold

[[email protected]  1214.2001    -13.4999  (-1.1%)   ]

prepares to retreat from a series of historic dollar highs.

While the move out may only last for the short term, he says the metal has "gone parabolic" and should be sold.

"(W)e are traders here, not investors, and traders listen to and watch the market, looking for signs of a changing environment," Gartman writes. "The environment has been changing; violence and volatility are everywhere. We want out. The sidelines look inviting."

Gartman himself, however, remains in a series of gold holdings using currency plays.

He is holding 15 percent gold in his currency portfolio, with equal parts in the euro, yen, sterling and Swiss francs. He also is long 10 percent silver and 15 percent each of Canadian and Australian dollars. He is short 15 percent apiece in euros, sterling and yen.

"We want out...entirely," Gartman tells clients regarding the gold trade. "We wish we'd have been able to send (the letter) to everyone earlier this morning when exiting the trade was wiser, but we've a time table to stand by and we are few hours late in exiting...but exit we must...entirely...upon receipt of this commentary."

Gartman notes that he now will look for other trades to replace his former positions "to which we intend to return in the not-so-distant future."

"As noted recently, perhaps buying steel and buying gold, or buying copper while buying gold, or buying stocks while buying gold...all positions that shall benefit from what we are calling the 'Zimbabwe-isation" of the capital markets in Europe," he writes.

"We are not ready to act yet, but we obviously are considering acting, and those with a somewhat more acute sense of timing and/or a greater sense of trading adventure might wish to venture in this morning."

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