Daily Digest

Daily Digest 2/6 - States Prepare For Hyperinflation, Shipping Rates Go Negative, What If The Lights Go Out?

Monday, February 6, 2012, 11:59 AM
  • Markets, Murmurations, and Machines
  • Greece takes step closer to default
  • Silver packs a punch as chemotherapy drug
  • Shipping Rates Go... Negative
  • U.S. States Prepare For Hyperinflation
  • What If We're Beyond Mere Policy Tweaks?
  • What If The Lights Go Out?
  • In Fuel Oil Country, Cold That Cuts to the Heart
  • Texas's Electrical Power Predicament

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Markets, Murmurations, and Machines (adam)

I'm not sure if you've noticed or not, but over the past year or so there's been a surging interest in the flocking behavior of starlings. Why? Well, other than the awe-inspiring beauty of one of nature's most beautiful and mysterious phenomena (see video), it represents a steadily growing dynamic at work within our own society and financial markets—namely, the collective behavior of any highly interconnected system.

Greece takes step closer to default (Ernest W.)

George Karatzaferis, the head of the small rightwing Laos (People’s) party said as he left the prime minister’s office, that he expected the talks to continue on Monday. There was no immediate announcement by Mr Papademos.

Silver packs a punch as chemotherapy drug (David B.)

The silver complexes proved to be as effective as cisplatin in attacking both types of cancer cells. Complexes containing a ligand which had two bonds were more effective than those with a single bond, probably because they are more stable - meaning the compound breaks down more slowly and is active for longer.

Shipping Rates Go... Negative (pinecarr)

Following the endless collapse in the Baltic Dry, it was only a matter of time before the shipping industry one-upped the Chairsatan, and was the first to introduce, dum dum dum, negative rates. That’s right: you are now paid to hire a ship.

U.S. States Prepare For Hyperinflation (David B.)

“I refer to this [U.S. Treasuries] as the global government finance bubble and I draw parallels between Greece and sub-prime U.S. mortgage back in the Spring of 2007,” said Nolan. “In the Spring of 2007, confidence started to falter for sub-prime. The risk is part of mortgage debt and of course you had the aggressive policy response. You actually had a very speculative market and you didn’t have a serious crisis until sometime later in 2008. Now we see Europe; they had the initial Greek crisis; they responded aggressively with the bailout. That bought them some time, but then things started to spiral out of control last year.”

What If We're Beyond Mere Policy Tweaks? (June C.)

Does anyone actually know what tens of thousands of highly-paid people are doing in all these sprawling fiefdoms of National Security? And I don't mean the Pentagon or the NSA--the buildings sprouting all over the tonier bits of D.C. and its suburbia are the metastasizing results of the "green light" given to anything remotely connected to GWOT--the global war on terror, the war that by definition can never be declared won or even ended, the war that always requires more funding lest one "event" slip through the cracks.

What If The Lights Go Out? (David B.)

The grid, for a host of reasons, may be ill-equipped to meet all the enormous challenges it faces. For so long, the market for doomsday scenarios of powerlessness has been cornered by survivalists prattling on about Mayan calendars and end of days. Rest assured that these are not my people. In my basement, you won’t find 6,000 rounds of ammo or floor-to-rafters stacks of MREs. My level of preparedness tops out at 4 gallons of bottled water, a 6-volt flashlight, and a four-pack of Bumblebee tuna, and each of those items is actually a holdover from last summer, when I briefly succumbed to the pre-Hurricane Irene frenzy.

In Fuel Oil Country, Cold That Cuts to the Heart (John M.)

The oil man said he was very sorry. The customer said he understood. And each was left to grapple with a matter so mundane in Maine, and so vital: the need for heat. For the rest of the weekend, Mr. Libby agonized over his decision, while Mr. Hartford warmed his house with the heat from his electric stove’s four burners.

Texas's Electrical Power Predicament

For 2012, I assumed the owner-announced shut down of 1186 MW worth of power from two coal-fired plants in the ERCOT area of Texas will occur. Based on this for the month of August, Texas should expect 12 to 17 days with Level 2 conditions leading to industrial load shedding and purchases of emergency power, and, 1 to 11 days of Level 3 conditions with rolling blackouts. The exact number would depend on the extent to which electricity demand stays the same as in 2011 or increases by its traditional 2%.

For 2015, I assumed EPA-estimated or owner-announced shut downs of 8 coal-fired plants amounting to 2,642 MW of power will occur. If Texas had no increase in demand compared to 2011, I estimate 17 days with Level 2 conditions and 11 days with Level 3 conditions, again all during the month of August.

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Electro-Motive Plant in London, Ontario, Closes After Lockout


Here is the money quote:

Workers at Electro-Motive had been off the job since New Year's Day after rejecting a new collective agreement that would have lowered the salaries of some workers currently paid $35 an hour to $18 an hour. Despite the closure announcement, picket lines remained active at the site on Friday.

The company apparently intends to relocate its operation to a facility in Muncie, Indiana, where Moffat says it will have an easier time moving ahead with less resistance from workers.


And my reaction:

Conditions for workers are getting so bad in the United States that we are now starting to become a potential off shoring destination for jobs from other first world countries. The politicos like President Hopey-Changey will crow when these new, low paying Indiana jobs become reflected in the U.S. employment figures, but they will not be jobs that allow the workers to buy a house, pay for their children's college education or plan for a secure retirement. This is the endgame of NAFTA, GATT and all of the other "free" trade agreements...lowering global wages until they reach a worldwide equilibrium just above subsistence level and enriching the predatory capitalists who ruthlessly shift the jobs around. It's another telling indicator of the new dystopia.



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Interesting article on

Interesting article on states preparing for hyperinflation, David B.!  I am surprised to find that level of awareness in the leadership of those states.  I.e., i'm surprised that there actually are people in leadership positions trying to proactively position their states to have a working currency in the case of hyperinflation!  Well, I guess I had heard about Utah's efforts before, but I think that was about it.  I don't know if having some states recognize the risk is hopeful, because it means people are starting to wake up and prepare, or of it is frightening, because things are so bad that even state leaders are recognizing the risk!

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Arthur Robey
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A gift.

President Hopey Changey and the Chairsatan.

Somebody has got to write a novel. It will be a hoot.

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Arthur Robey
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Thick as a Brick.

James Howard Kunstlers irresistable  weekly rant linked me The Naked Capitalist where I read

They (the Banks) will reduce the minimum payment due when a borrower (Mortgage) is close to being officially delinquent, and tell them to send a small amount and declare the loan current. Or they simply increase the credit line on the home equity line and let the borrower pay them with new funds lent to them. Neat, eh?

Now I am as thick as two short planks but even I can see that is not Kosher. Or maybe it is. Or has become the new norm.

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Wendy S. Delmater
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US States Prepare for Hyperinflation

In the article I note it says:

Of the 13 States gearing up for its own currency, Danker told CNN he expects four States could pass legislation this year. Those States include South Carolina, Georgia, Idaho and Indiana.

Ah - my state, South Carolina. Glad to see thay have their heads at least partially out of the sand.

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