GAIA

Heat, drought and the Spanish lady

The current heat wave and drought across the United States (and Canada) has broken daily temperature highs more than 2000 times in various cities and towns across America -- according to a recent Globe and Mail article.

As well, according to an article by climate expert Thomas Homer-Dixon, (G&M, July 24, 2012, A13) North America is having the longest and worst drought since the 1950’s, destroying the grain and corn crops of the American bread basket Midwest.  According to him, new research shows that “just one day of 40-degree weather will produce a 7-per-cent drop in the annual yield of corn compared with yields if the temperature stays at 29 {degrees Celsius] throughout the growing season.”   So expect food prices to skyrocket in the short and long terms as higher temperatures and droughts become the ‘new norm’ thanks to Global Warming.

While I do not dispute the statistics and observable heat and drought conditions,  I do disagree with these avid Global Warming advocates and their warnings : people, must change or extinction looms – especially as world population balloons from 3 billion in 1960  to a projected 10 billion** by 2050  (as stressed by Mr. Homer-Dixon).

Here is what has been left out of their analyses.

1.      Droughts – normally accompanied by elevated temperatures – can last up to 7 or even 10 years.  That is not new.  They are highlighted in the Bible from the times of Joseph and Ruth.  The 1930’s Dust Bowl is also well documented.  Even the ongoing Darfur crisis in Africa is at its core a drought issue (though aid groups and western media prefer to see the dislocation of peoples as a racial or religious war rather than sheep herders versus agriculturalists in a land were almost nothing will now grow.)  

So severe and even long droughts are not unknown from the distant or more recent past --worldwide and in North America.

 

2.     Global Warming advocates seem to have missed the most important change in global weather in the last 20 years – the sudden absence or end-of-a-cycle of La Niña!!!  This summer ‘ocean-atmosphere phenomenon’  -- which is well documented and affects all of North America and the Pacific to China and Australia  -- normally causes excess rainfall and wet conditions  in the U.S. Midwest,  and its absence this year has had the predictable, opposite results.  (For more on La Niña and her winter twin, El Niño and their control of world weather patterns, see Wikipedia or any other source.)

3.    The amount of water on this planet is more or less constant, either in the form of rivers, lakes, oceans and underground aquifers or in the form of rain, hail, snow and vapour – i.e., clouds – in the sky.  Our upper atmosphere acts as a shield keeping moisture “in”.  That is why films such as Day After Tomorrow (2004) are a joke.  If North America and Europe, etc. all start to freeze and get covered in snow in just hours, other huge parts of the planet must be heating up and losing water at equal speed.   There is only so much liquid/moisture available.

So while most of America (and Canada) are suffering heat and drought, other places will pick up the water we don’t get.  England and London in particular are awash in rainfall at historic highs – not very helpful for the 2012 Olympics – and Canada’s idyllic city of  Vancouver has had what locals have described as ‘one long winter’ into July; lots of rain and temperatures barely above 20 degrees Celsius.

4.    Finally, why does Mr. Homer-Dixon use a one day comparison difference of 11 degrees Celsius or 20 degrees Fahrenheit - i.e., 29 vs 40 degrees Celsius?  His quote on the 7% drop in yield due to a single day of excessive heat is dramatic but totally misleading.

America’s Midwest regularly has at least one day that surpasses the 29 degree figure.  What is relevant, really, is the affect on yields when there is one day of, say, 32 degrees Celsius or 36 degrees – which can occur normally.  Even better, what is the effect of a week or more of mid-30s highs?  Mr. Homer-Dixon does not say. He prefers to go for the dramatic and unfair comparison; to distort the use of statistics!!!

 CONCLUSION

La Niña (and El Niño) are not man made. Yet they control much of the world’s weather and rainfall.  They appear for reasons not well understood, in long cycles that abruptly end. The end of a cycle (or start of one) makes for unexpected and dramatic alterations to rainfall patterns and regional climates that may take years to ‘readjust’.

And if the planet is increasing in its overall temperature – think the age of the dinosaurs when much of Canada’s Alberta wastelands and the China’s Gobi Desert were lush tropical forests – then attribute it to the planet’s cycles, earthquakes and volcano activity – not the actions of the human ant.

P.S.  ** 10 billion is the highest projection ‘model’ from the United Nations.  Its middle projection is only 7.5 billion and its lowest projection is 6.5 billion – all depending on fertility rates, disease, famine and life expectancy estimates.  

GAIA

GAIA

Candu won’t do   (Old post but relevant today still)

On Sunday, September 19, 2010, I heard a radio ad on 680 News urging the Canadian federal government take actions so that more Candu nuclear reactors could be built and sold. China is mentioned as a prospective customer as well as Ontario itself.

The ad makes some interesting claims and statements:

1. A Candu reactor has a 60 year life span.

3. Ontario’s Pickering nuclear power plant will need to replace its reactors
starting in 2020. (This is true.)


While the above 2 ‘facts’ make nuclear power and Pickering seem a great success and long term value -- i.e., 60 years, the following information taken directly from the Ontario Power Generation website tell a different story
[ http://www.opg.com/power/nuclear/pickering/].

Pickering A - the first four of the Pickering reactors - went into service in 1971 and continued to operate safely until 1997 when it was placed in voluntary lay-up as part of what was then Ontario Hydro's nuclear improvement program. In September 2003, Unit four, was returned to commercial operation. Unit 1 was returned to commerical operation in November 2005. Units 2 and 3 remain in a safe shutdown state.Pickering B - units five, six, seven and eight - continue to operate safely since they were brought into service in 1983. They have a combined capacity of approximately 2,100 megawatts.



SO HOW TRUSTWORTHY IS THIS RADIO AD’S INFORMATION?
-- NOT VERY.


Why, because:

Pickering A has had numerous problems requiring years of ‘down time’ and at a projected cost of billions of dollars. Repairs on one reactor alone ran 900 million dollars over budget, and took more years than expected to complete (See Wikipedia.) So other rteactors, as mentioned above, have been left shut down as too expensive to fix!!!

Pickering A, the older part dates only from 1971. In 2020 Pickering A will only be 39 years old, so why phase out or replace its reactors if they are expected to ‘live’ for 60 years – i.e., until 2031??

Why shut reactors down 10 years before the end of their life expectancy?



BOTTOM LINE:

As far as I am concerned, the Candu just won’t do.

It is a financial and dependability fiasco -- for Ontario or any other buyer.

Building more of them to sell to clueless foreigners is unethical and will backfire on Canada.


P.S. End of November, 2010 - The Ontario government is soon to release its 20 year energy plan and expects ½ of Ontario’s future energy to be NUCLEAR. Existing and/or unusable reactors will be ‘refurbished’ and 2 new reactors will be built.

Heaven help Ontarians on 2 fronts: billions of dollars of cost overruns and years of delay, and increased chances of radioactive leaks and nuclear meltdown.

YOUR MONEY

The World Gone Mad – Canada style

For 3 days last week the Globe and Mail’s business section featured articles in favor of high oil prices. This included a speech by Bank of Canada head, Mark Carney.

The argument goes as follows:  

Canada’s economy is currently heavily dependent on oil production for jobs, government royalties and gas pump taxes (which are a percentage of the cost, not a flat fee).  To ensure growth in the oil sector, the price of crude should be – are you ready for this – at least $100 a barrel.

At present, the fluctuating range is a mere $85 to $93. 

In addition, it is suggested that high oil prices and oil industry jobs will compensate for the high value of the Canadian dollar.

RESPONSE/REBUTAL

1.    The price of oil (whether Brent or West Intermediate Texas) are WORLD WIDE PRICES.

Almost everyone in the Western world, and most of the rest of the planet, are oil dependent for transportation or heating/electricity.  The higher crude goes, the more everyone suffers – as the costs of food, clothing, plastics (made from oil) all go up.  That’s called INFLATION!!!  World wide inflation!!!

2.    $100 or more a barrel is WINDFALL PROFIT RANGE.  The tar sands of Alberta are profitable at $70 a barrel according the the OPEC minister from Saudi Arabia (just a year ago).  Even he considered then prices above $100 excessive.

3.   Today, thanks to the new technique called fracking, oil and gas in deep shale beds are now retrievable.  New massive oil and gas fields have been found off the shores of Brazil and Israel to name just two oil import dependant countries. And upper Middle America – especially North Dakota – have become the envy of even Texas.  Production has already started and will soon be in full gear – adding millions of barrels of oil to the world’s supply (and even more natural gas).

In a world with permanent oil and natural glut for at least the next 50 years, $100 oil is a delusional speculator’s pipedream.  Think of oil at $60 to $70 a barrel as the coming ‘new global normal’.

4.    As for the high value of the Canadian dollar, it is a direct result of high oil prices. Yes, we produce other commodities such as grains, lumber, fertilizer, copper and coal to name a few world demand resources, but oil seems to be the strongest factor in the minds of currency traders; put simply, the Canadian dollar is seen as a ‘petro’ currency. Just watch the Canadian dollar’s daily ups and downs  and the parallel moves of oil benchmarks. So lower oil prices will also lower the Canadian dollar’s international exchange rates and help exports of manufactured goods and commodities.

 

CONCLUSION

So what of the pro-high gas advocates and their vision?    It’s not based on the general welfare of Canadians and the world’s population of 7 billion.  It is not based on reasonable or fair profits but profiteering!!!!

We pay enough taxes to government in a thousand ways. ‘Milking’ oil for more revenue is disgusting and only in Canada would someone of Mr. Carney’s stature even consider such ‘extra taxation’ as ‘good’.

When prime Minster Trudeau instituted the National Energy Program (NEP) in 1980, when Middle East oil became exorbitant, when Central and Eastern Canada could no longer stay in business importing such oil, (and prime was at 10%), Western Canada’s oil prices were regulated within the country and surplus wealth redistributed to keep more than half the country afloat.  The idea of affordable oil was essential to the prosperity of the nation, Trudeau argued.   

I remind Mr. Carney, high oil advocates/shills  and the western oil companies of that time and philosophy.

Trudeau was right to create a balance between the interests of the oil industry and the West and the manufacturing/service based rest of Canada.

A new, national plan to balance the interests and needs of West and East must be found.

GAIA and Your Money

Rethinking Globalization – the next manufacturing landscape

According to the Globe and Mail, Monday, June 25, 2012, page B3, Japanese automobile manufacturers are moving some manufacturing totally outside of Japan.  Honda now makes its Fit vehicle in China, and Toyota is ending the manufacture of its Yaris subcompact in Japan, instead setting up shop in France – of all places. Currency exchange rates (the Yen is too high) and the cost of shipping are given as the reasons for job outsourcing.

The above 2 excuses, however, do not hold up.  The Yen has often ‘risen’ in value against the U.S. dollar and other currencies and oceanic transportation costs should be dropping as the price of oil collapses by 1/3.  So what is the real reason or reasons?

I suggest that a new strategy and direction – a fundamental ‘rethink’ of how to manufacture goods has emerged.   The Fukushima Daiichi Nuclear Power Plant disaster and more recent flooding in outsource component hub Thailand   disrupted Japanese auto production and sales around the world-- as needed components were not available for weeks.

So, globalization is fine for expanding one’s markets, but not for manufacturing anything with numerous components when Gaia gets upset and burps. 

While Thailand or China may have the skilled labour to produce a certain component cheaply, the benefit is lost in the TIME for long distance transport and the RISKS of ‘just in time’ manufacturing with single source parts.

Soon, the new buzzword will be ‘total localized production’.  Build a plant or two or three with their own, localized and complete supply network  --  in each major population area: North America, Europe, South America and East Asia.  If Gaia disrupts one area’s production, you are not without alternative ‘backups’ to ensure continued production, sales and profits.Last updated 8 days ago

Our New World

The End of the Japanese Miracle

The great industrial miracle of post-WW2 Japan seems to be coming to an end.

Its world domination in electronic innovation and quality manufacturing – think Beta and VHS, walkman, CD, Blu-Ray DVD, Nintendo, PlayStation, Toyota, Honda, etc. – is rapidly ending.

South Korea is the new East Asian king, with Samsung and LG in electronics and Hyundai and Kia rushing past their Japanese rivals. Meanwhile, the USA – through Apple, Microsoft (including X-box), Google and Facebook – has returned to pre-eminence in the world of computers and the Web.

Today, Japan faces a triple whammy that will make it less and less competitive:

1.      an aging and shrinking population thanks to a negative birth rate of 1.29 (replacement rate is 2.1)¹

2.     a cultural mental-block that refuses to allow replacement ‘foreign immigration’

3.      the end of cheap nuclear power after the 2011 earthquake/tsunami disaster at Fukushima Daiichi Nuclear Power Plant.  Imported oil and liquefied natural gas from North America is far more expensive, but the citizens of Japan wish no more Fukushima-like  – or worse, Hiroshima-like     -- experiences.  (One plant has been restarted in early July, but wait for the backlash in protests and the upcoming elections.)

Honda has already switched the manufacture of its Fit vehicle to China, and now Toyota is doing the same with its Yaris subcompact – this time relocating to France – of all places.²

Major manufacturing ‘at home’ will soon be a thing of the past – unless Japan addresses its birthrate crisis and xenophobic immigration policies.

 1.     http://savingjapan.net/2011/03/31/formspring-response-japans-flagging-birth-rate/

YOUR MONEY

Saving Capitalism and the World Economy -- three straightforward solutions

Capitalism has lost its way.  Greed and the chase for ‘easy and quick fortunes’ have created a speculative casino-like environment to the detriment of ordinary investors and the public good.

Stock Markets

1)    Thanks to the miracle of computerized trading, millions of dollars can be made – or lost -- in seconds by manipulating legitimate electronic trading and ‘gaming’ the system.  Such clever market manipulation by investment companies, banks and the super wealthy has become too commonplace.  According to Maclean’s Magazine, July 16, 2012, p. 47 “Stock Market Hackers”, HFT (high frequency trades) account for 42% of all trading in Canda. By  using super-fast computers and programs that allow one to flood the market with buy or sell orders and then do the reverse in a second -- once ‘others’ have risen to the ‘bait’ – millions in profit can be made in less than 10 seconds.

2)    Thanks to the perversion that is today’s derivatives industry, an industry created to act much like insurance companies,  companies now play fast and loose with client monies and their own assets to make high risk exchange ‘bets’.
Just check out the JPMorgan Chase debacle, whereby the bank’s derivates traders lost up to $9 billion U.S. by ‘guessing wrong’ on the direction of the Euro currency. According to the G&M (July 9, 2012, B2) the bet was for $100 BILLION U.S.!!!!

3)     Thanks to the loosening of regulations in commodities, the markets for wheat, corn, soybeans, coal, iron, copper, oil and similar products have been opened up to speculative mania.  No longer are these products made available just to end users.  Instead, since the early 2000s anyone can put in a buy order on the futures market even though they have no intention of completing the deal.  With more bidders and buy orders, sale prices go up and the illusion of a ‘shortage’ of product is created.  Speculators then quickly flip their orders (which are not pre-paid in full) to manufacturers and end users who need the product -- at an artificially higher price.  In the end, consumers get fleeced and inflation goes up.
For example, according to oil industry experts, when the price for Brent (Europe) crude and West Texas Intermediate (USA) were over $120.00 a barrel, some 20% of that price was due to speculators ‘goosing’ the system for quick profits.

Currency Fluctuations and panics

Since the world’s governments went off the Gold Standard in the early 1970s, the value of a currency was ‘left to market forces’ to decide.  Put simply, this has transferred monetary policy and control from governments to the currency investment branches of major banks, investment companies, sovereign trusts and the super rich – who make thousands of ‘bets’ each day on the future value of the U.S. dollar, German Marks, Japanese Yen and all other currencies.
Canada, for example has had its dollar sink to mid-60 cents U.S. and rise to $1.10 U.S. more recently.  Currently, the Canadian dollar not only goes up or down in value by the minute on international markets.

What this means for the citizens of all countries is their savings can become almost valueless on speculative ‘bets’, and manufacturers and exporters and importers must find comfort in Rolaids or scotch --as their business models blow in the wind of international game playing.  Even a 1 cent change in the dollar is a massive change for any company that works on a 10% or less profit.  And not knowing what your goods will be worth next week or next month complications manufacturing and production decisions throughout the economy.
Put simply, people and business do not like volatility and unpredictability in their currency.

Governments also pay a huge price whenever there is a speculative run on their currencies.  To prevent a ‘collapse’ governments buy up their own currencies from the very speculators who have caused the crisis. Think bribe, and rewarding bad behaviour.

Solutions

Here are THREE simple suggestions that would minimize speculative greed and the quest for windfall profits that distort the marketplace.

1.     Restrict a purchaser’s ability to do a quick flip.  Institute mandatory ‘must hold’ times of 7 days to 30 days depending on the industry.

2.     Ban derivates firms from trading in commodities, stocks, etc.  Restrict them to the insurance end only.

3.      Return money to a gold standard backed by bullion.

While these 3 solutions will be hard for the world stock markets, money and government establishments to accept, nothing else will do.   We need a few simple   reforms to clean up the mess we are in today, to permanently alter the psychology of the market and government ‘players’.   

Greed is not good despite actor Michael Douglas; and Warren Buffett has it right when he advises to never buy a stock or investment you do not expect to hold on to for 10 years.  Long term should be the goal and norm – as of old,  not time measured in seconds.

P.S.    Fraud for a quick Buck

The above problems and manoeuvres are not illegal acts, just ‘smart tricks’ that are within the current rules.

Outright fraud is another matter and harder to regulate.  Crooks just don’t even try to follow the rules. Think Bernie Madoff, former head NASDAQ stock market, who went ‘rogue’ and bilked friends, celebrities and charities of billions!

Currently the headline story of illegal acts is the expanding Libor scandal. Barclays and some 11 other major international banks ( including Royal Bank of Scotland, Deutsche Bank, HSBC Holdings, UBS AG (Swiss), Citigroup, J.P.Morgan Chase) are admitting they colluded to make millions by regularly lying to the British Bankers Association and thereby altering the  official benchmark interest rate called the Libor --  used around the world. (See G&M, July 2, B5; from The Wall Street Journal).

Resignations at the top are nice to see as in the case of Barclay, but better yet jail time – 10 -20 years -- for those who plotted the crime and executed it.

GAIA

Elephant insanity

Recently, the powers behind animal ‘conservation’ have made another stupid decision, similar to one made some 2 decades ago.

To end poaching and the slaughter of endangered African elephants for their ivory tusks, the government of Gabon burned to ashes 5 tons of confiscated tusks and allowed the media to showcase the bonfire.

The tusks and ivory were worth  $14,000,000 and representing some 850 killed elephants. (Data and images from http://photoblog.msnbc.msn.com/_news/2012/06/27/12446018 elephant-tusks-ivory-torched-to-keep-out-of-smugglers-hands? lite)

 This was done with WWF support and general applause in the western media.

But this burning  -- like the one some 2 decades ago which destroyed an estimated  5 years supply of ivory – was a stupid decision.  Nice symbolism, maybe, but poor economics and strategy.

The point is this.  Burning confiscated tusks and ivory is counter-productive!!

It insures that there is a ‘scarcity’ of tusk ivory for sculptors and traditional artists around the world – leading to higher prices and an ever-growing poaching underground.

It would be far better to flood the market with these confiscated tusks, thereby bankrupting  the poacher gangs, and generating revenue for the elephant preservation organizations and programs.

Even better, have the animal wildlife organizations create a tusk/ivory supply system that is legal and safe for the animals.

1.    If an elephant dies naturally, why not remove and reuse its tusks?

2.    Elephant tusks can grow well beyond what is needed for self-defense or moving objects so why not allow ‘selective’ tusk cutting as is common practice in India and elsewhere. 

Either or both of these measures – not the symbolic destruction of thousands of tusks  for media show – would benefit elephants far more.  Poaching and the criminal gangs involved would be eliminated, and traditional ivory carving artists would have a better, legitimate and less expensive supply.

That way, endangered elephants, traditional artists and the general public would benefit.

YOUR MONEY

Looney Loonies and Toonies

Has the Canadian Mint lost its mind or is it just inept?

The Mint in April switched manufactureof its $1 Loonies and $2 Toonies to lighter, steel materials without realizing – or giving sufficient notice – of these dramatic changes.

The thinner coins and materials cost less to make, but have created havoc and chaos in the real world – and will cost businesses and any government with parking metres MILLIONS OF DOLLARS for new coin mechanisms. 

FACT: Coin machines today not only measure the diameter and thickness of a coin, but also its weight or scan for standardized magnetic field reflection (based on the coins metal(s)).   To change a coin’s weight or metallic content confuses the machine – with predictable results.

Currently – its now early-July -- vending machines still eat the new coins or do not accept them, and parking metres across Canada have the same problems.

According to the City of Toronto, it costs $345 to adjust each of its 3,000 parking metres.  That’s over ONE MILLION DOLLARS for Toronto alone!!!  (Source -- http://ca.news.yahoo.com/blogs/dailybrew/lighter-loonies-toonies-causing-headaches-vending-parking-machines-202448810.html)

Q: Will the Federal government – which is ultimately responsible for Canadian currency and its manufacture – reimburse one and all for these costly change?  

Q: Will the Mint formally apologize for the flawed execution of these coin changes?

So far, no apology from the Mint or comment from the Prime Minister.

Shame, shame, shame!!!

MEDIA

Betty - The second shoe drops

Betty now joins Fisher, the main character in another Globe and Mail, Canadian comic strip, who was fired by his advertising company -- due to ‘downsizing’ -- just a few weeks ago.

July’s first week of Betty completes an arc on ‘corporate reorganization’ begun weeks ago as it finally touches Betty herself. Betty’s new superior (brought in by the new CEO) is her best friend Alex.  Alex now calls Betty to her office and tells her her job is no longer needed and she is being ‘let go’.  The next 3 episodes show Betty holding all her personal belongings in a box, with a female security guard at her side.  When Betty makes a joking comment, suddenly 3 guards now stand beside her.  Another Betty comment and she is escorted from the building with a conga line of at least 20 muscular guards following her.

While the comic strip is clearly making fun of ‘exit escorting’, it touches a raw nerve.

The old fashioned Pink Slip (firing notice) -- left in one’s mail or on one’s desk -- may have been abrupt and impersonal, but the ‘new normal’ is even more upsetting and humiliating.

Getting 5 seconds to clean out one’s belongings after years of service, and being escorted out by security guards is emotionally traumatic and publically embarrassing!

Blame the computer and cell phone for this.  Upset employees can ‘sabotage’ a company and destroy records with a few clicks. Vital information could be transferred to a memory stick, etc. and

be passed on to competitors – or regulating government agencies.

 For the sake of corporate ‘security’, instant removal is the key, with computer access passwords and corporate cell phones disabled -- either during the firing meeting or seconds before.                                                       

-         -    -    -

The worst story I know of is regarding an upper executive returning from an international meeting at which he represented his company.  On landing, he found his cell phone would not activate properly and when he reached his head office building, he was barred from entering the premises by security guards.

He had been with the company for over 25 years and was a personal friend of the owner and corporate boss.

So much for years of loyal service and friendship.

In this new world, the best one can hope for is in the film Up in the Air, where experts are introduced to do the firing, break the news in a ‘supportive fashion’, and offer encouragement and follow up advice on job hunting, etc.

-       -    -    -

Betty and Fisher have joined the hundreds of thousands of white collar workers who have been ‘let go’ or ‘fired’ (as Betty calls it) during the current, ongoing Great Recession.

Q: Will Betty mope like Fisher is now doing? 

Q: Will she – or he – find another job soon – to help support their      families?

Stays tuned to these comic strips, and keep your fingers crossed.