Daily Digest

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Daily Digest 2/26 - Edible Coffee Cups To Debut In U.K., Nigeria’s Future Depends On Electricity

Thursday, February 26, 2015, 10:49 AM

Economy

Ex-Plunge Protection Team Whistleblower: "Governments Control Markets; There Is No Price Discovery Anymore" (travissidelinger)

In this 38 minute interview Lars Schall, for Matterhorn Asset Management, speaks with Dr Pippa Malmgren, a US financial advisor and policy expert based in London. Dr Malmgren has been a member of the U.S. President’s Working Group on Financial Markets (a.k.a. the “Plunge Protection Team”).

Janet Yellen Is Freaking Out About "Audit The Fed" - Here Are 100 Reasons Why She SHould Be (Phil H.)

Appearing before the Senate Banking Committee, Yellen was on the defensive, as Republicans questioned how the Fed conducts monetary policy and Democrats put forward ideas for getting tougher on Wall Street.

In the midst of all of it, Yellen generally argued the Fed was designed as an independent entity for a reason — and it would be best not to change it.

“Central bank independence in conducting monetary policy is considered a best practice for central banks around the world,” she said. “Academic studies, I think, establish beyond the shadow of a doubt that independent central banks perform better.”

How Mice Turned Their Private Paradise Into A Terrifying Dystopia (DennisC)

In 1972, with the baby boomers coming of age in a ever-more-crowded world and reports of riots in the cities, Universe 25 looked like a Malthusian nightmare. It even acquired its own catchy name, "The Behavioral Sink." If starvation didn't kill everyone, people would destroy themselves. The best option was to flee to the country or the suburbs, where people had space and life was peaceful and natural.

Terror in the Middle East: Scarcity, Poverty and Cultural Change (Tyler K.)

Even after Lawrence united the Arabs against, and defeated, the Ottoman Empire with the help of the British, the Arabs still couldn’t agree and left the scene not united as Lawrence envisioned.

No wonder there is so much hate and civil war in this most volatile region of the world economy. But that is only the first reason…

Having and Fighting Ebola — Public Health Lessons from a Clinician Turned Patient (jdargis)

While in Guinea, I often woke up sweating in the middle of the night, my heart racing. I might have felt warm, but my thermometer would read 97.7°F — perhaps it was broken? I started diagnosing myself with gastritis, amebiasis, peptic ulcer disease. Though I understood the connection between psychological stress and physical pain, I'd never experienced it like this. As an emergency physician, I try to approach challenging situations rationally and remain calm under pressure. But my work made it hard for me to relax and feel like myself.

Empire: The Unintended Consequences Of Colonialism (jdargis)

Exploration and exploitation of these regions was not new, as the English and Portuguese claimed their stake in the East long before the Dutch arrived. There was, however, one key difference to the Dutch endeavor: while other European colonials sailed under the protection of their royal houses, the Dutch sailed under a corporate logo. The VOC was just that: a privately held company operating independently from the Dutch government. It was the first company to issue public stock, and the first to control a private military. Through financial cunning and sheer force, the company pressured territories the world over into exclusive trading contracts.

Shale Gas Project Encounters Determined Foes Deep in Algerian Sahara (jdargis)

“The winds of social change will blow from the south,” Rachid Tlemcani, a professor of history at the University of Algiers, predicted. “In the north the demands of people are housing, jobs and for their share of the oil revenues. But in the south, they are saying we don’t need shale gas, for the sake of the environment. They have a very high social conscience.”

Nigeria’s Future Depends On Electricity (Evan K.)

Nigeria has one of the worst electricity supplies in the world second only to India. No access to power hinders the country’s development in all sectors from education up to industrial production. Nigeria’s Achilles heel is therefore not Boko Haram but electricity, and if the next president won’t prioritize power generation the country risks stagnating economically in the coming years. Nigeria produces around 4,000 megawatts for a population of over 170 million; with a similar population, Brazil generates 24 times as much. South Africa consumes 55% more energy per capita than Nigeria, where half of the population does not have access to power.

Why Tesla's battery for your home should terrify utilities (Wendy SD)

SolarCity has already begun installing Tesla batteries, mostly on commercial buildings like Walmart stores, which have to pay higher rates when they use lots of power during peak hours. Tesla’s batteries let them store up solar power when they don’t need it, then use it when rates are high, shaving 20-30 percent off their energy bills, according to Ravi Manghani, an analyst at GTM Research.

The Fantastic Transformation of Subway Cars into Artificial Reefs (jdargis)

The agency was stripping the cars—removing motors, wheels, hydraulics, seats, windows, light fixtures, and Freon from the A/C systems—and dumping them overboard so far into the ocean you couldn't see land. The rusty conveyances initially served as shelter for invertebrates and migrating fish. As time passed they attracted scads more marine life, including sharks, economically important game fish, and at least one curious sea turtle.

KFC Plans to Roll Out Edible Coffee Cups in the U.K. (jdargis)

“This type of edible packaging is definitely aligned with the global consumer mind-set in terms of sustainability and simplifying their life,” Shilpa Rosenberry, a senior director for global consumer strategy at consulting firm Daymon Worldwide, told the Times.

Gold & Silver

Click to read the PM Daily Market Commentary: 2/25/15

Provided daily by the Peak Prosperity Gold & Silver Group

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."

7 Comments

saxplayer00o1's picture
saxplayer00o1
Status: Diamond Member (Offline)
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cmartenson's picture
cmartenson
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Posts: 5971
Yellen Lies To Senate

I really prefer that we use accurate language whenever possible.

According to the headline below, what we have is a simmering debate.

Instead what we have is a case of Janet Yellen lying during Senate testimony:

Yellen comment highlights simmering debate over return on excess reserve

Feb 26, 2015

During the hearing Tuesday, Senator Pat Toomey (R-PA) probed Yellen about the central bank's plan to increase interest on excess reserves, as part of its process to normalize monetary policy. Yellen responded, “Well, remember that first of all, we will be paying banks rates that are comparable to those that they can earn in the marketplace, so those payments don't involve subsidies to banks.”

However, the Fed pays banks well above market rates, as measured by a closely-watched benchmark.

In fact the Fed is paying banks about 250% more than market rates for the excess reserves they have stashed with the Fed.

And she know this, probably better than anybody (we’d hope).

If you think that getting 250% more for your money in one place vs another is “comparable” then I guess we can call that a matter of debate, simmering or not.

I just call that lying.

And, yes, the Fed is paying subsidies to big banks at a time when those same big banks are reporting outsized, healthy and even record profits.  Call that what you will, Janet, but you aren't fooling me.

BK524's picture
BK524
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Posts: 10
phecksel's picture
phecksel
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Joined: May 24 2010
Posts: 204
cmartenson wrote: I really
cmartenson wrote:

I really prefer that we use accurate language whenever possible.

In fact the Fed is paying banks about 250% more than market rates for the excess reserves they have stashed with the Fed.

I seem to remember a contractual arrangement where the treasury pays Fed Res 6%.  There was an excellent write up showing the symbiotic relationship between the two several years ago.  I didn't keep a copy of the write up or a link to the site :(

Arthur Robey's picture
Arthur Robey
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Posts: 3936
Bary Bias Ritholtz

I am the chief investment officer of an asset-management firm

Barry.

Now why would Barry be in favour of an open fire-hose spigot of money directed at him I wonder?

Let me guess- (off the cuff, you understand). He is not one of the unemployed?

Boomer41's picture
Boomer41
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Joined: Nov 30 2008
Posts: 137
Tesla's Battery

 Having a battery in the home is a great idea, even if there are no solar panels involved.

The consumption of electrical energy by a household is very variable, even intermittent. Some appliances, such hair dryers and electric stoves, have a very high power demand, but only for short periods. The power supply to the house must be capable of providing the PEAK current required even if several high power appliances are operated simultaneously.

However, the AVERAGE power consumption is much, much lower.

A battery can perform a 'load leveling' function. That is to say the battery provides whatever peak power is required at any given instant without a corresponding increase in load on the utility company. The load on the utility is relatively constant, being only the power to maintain the battery at full charge.

The load on the utility company is thus leveled, being only the average power consumed, thereby eliminating the need for household connection capable of carrying hundreds of amps. Most households could easily get by with only a 32 amp 240 volt incoming supply.

I'd say SolarCity is really onto something.

 

Mots's picture
Mots
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Joined: Jun 18 2012
Posts: 198
Tesla's Battery

This is all nice, from the viewpoint of internet chit chat crap, and science friction dreaming, but is completely wrong from a viewpoint of planet earth.

CHEMISTRY and COST are most important but ignored in these warm fuzzy sci-friction articles.  The cost of making and using the tesla battery is COMPLETELY ignored.  This chemisty consumption cost far exceeds the cost of the electricity itself, (both for the tesla car and any tesla home load leveling).

A battery is a chemical machine made of chemicals that wear out.  The cost of the chemical battery (and true use-cost of energy) is conveniently ignored.  How much do those tesla batteries cost?  Even if the cost drops 10 fold, can they be practical for home use?

Just charging a new, still efficient battery loses 10% of the energy as heat.  The gradual breakdown of the battery during use lowers efficiency further and more importantly, far exceeds the cost of the electricity that it supposedly replaces, before even considering the cost of the energy.  

The cheapest most economical batteries possible are lead acid, and are still standard in the industry for this reason (nothing comes close to cost/performance).  A lead acid battery is about 50 times or more cheaper per kilowatt hour than these lithium batteries that everyone is dreaming about.  Yet, the cost per kilowatt hour storage of a lead acid battery is about 10 cents per kilowatt hour AT BEST and more likely 20 cents per kilowatt hour or more.  (a 50-60 pound lead acid battery can hold one kilowatt hour of charge and at best cannot be discharged more than 1000 times, but actually much less than this and only partially discharged due to performance constraints).

Have you ever considered how complicated and difficult it is to build a large lithium battery in view of the heat dissipation and individual cell control needs?  These batteries are extremely expensive and the optimistic estimates are still far off the table compared to lead acid.  Even if the cost drops 5 or 10 fold (which is wild overestimate of large scale manufacturing savings) the cost of using up the lithium battery far exceeds the cost of the electricity, even if we assume some fairyland future advances, in this industry that has been under development for many years now with billions of dollars invested to look for ways to make the batteries easier.  There is a big difference between dreaming and reality, when it is time to live in the real world.

Please consider how much the tesla battery costs.  Sure, one can dream up a system where you can use such a battery for load demands such as dishwashing at night , by paying 1-10$ for each such single event.  Load leveling is fine IF the costs dont shoot up a thousand fold due to chemistry consumption.  OR, you can schedule your use and get extremely low cost energy by scheduling such use during the afternoon.  The future is pretty obvous to me.  Local grids based on solar with scheduling, which will cost about 100 times less than the tesla dream.  There ARE real good technologies out there with serious solutions, but the simplistic idea of "big lithium willl save the day via load leveling" is unrealistic.

Mots

Boomer41 wrote:

 Having a battery in the home is a great idea, even if there are no solar panels involved.

The consumption of electrical energy by a household is very variable, even intermittent. Some appliances, such hair dryers and electric stoves, have a very high power demand, but only for short periods. The power supply to the house must be capable of providing the PEAK current required even if several high power appliances are operated simultaneously.

However, the AVERAGE power consumption is much, much lower.

A battery can perform a 'load leveling' function. That is to say the battery provides whatever peak power is required at any given instant without a corresponding increase in load on the utility company. The load on the utility is relatively constant, being only the power to maintain the battery at full charge.

The load on the utility company is thus leveled, being only the average power consumed, thereby eliminating the need for household connection capable of carrying hundreds of amps. Most households could easily get by with only a 32 amp 240 volt incoming supply.

I'd say SolarCity is really onto something.

 

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