Sunday, 1 May 2016
Coping with the Reality of
Climate Change - Tim
DeChristopher and Chris
Watch Tim's powerful discussion on the realities of climate change with Chris Hedges.
They explore the spiritual dimension of facing the horrific consequences of a 1.5C to 5C increase in average global temperature, the human impacts, wrestling with grief, and the adaptive advantage of cooperation as these consequences unfold.
In this episode of Days of Revolt, Chris Hedges interviews climate change activist Tim DeChristopher about the deadly failure of industrial world to confront the effects of climate change. The two discuss how climate change has, and continues to trigger social tension and injustice, and the necessary ethical response on the part of humanity as a whole.
Melbourne weather: Wild storms lash city
Wild storms swept across Melbourne in the early hours of Sunday morning, with wind gusts of up to 107km/h in some areas and impressive lightning displays across the city.
1 May, 2016
In Glen Waverley, a large gum tree came crashing down, damaging two houses.
@VicStormChasers picture taken of that storm which swept thru melbourne. From wollert
6:01 AM - 1 May 2016
Here it is! The low we have mentioned a number of times over the past few days which was set to develop over Tasmania. It is currently deepening but will moves south eastwards today.
Further rain and very strong winds will hit Tasmania today especially at the back end of the low (western and northern side) with squally w to sw winds.
Showers will also impact Victoria but mainly southern and mountain regions after a wild night with storms, strong winds and heavy rain in parts causing some damage.
The trough is running up eastern NSW and will cause rain, showers and few storms in this region today, Good rain and storms currently falling in the North west slopes and plains with falls up to 20mm from 9am alone! Unsetlled weather will move into southern Qld this afternoon.
Obama administration warns of ‘climate refugees’ due to rapid Arctic warming
US Interior Secretary Sally Jewell has painted a stark picture of communities displaced by rising Arctic temperatures that are ‘washing away’ towns
29 April, 2016
The Obama administration has warned the US will need to deal with a wave of “climate refugees” as the Arctic continues to warm, joining with the Canadian government to express alarm over how climate change is affecting indigenous communities.
Sally Jewell, US secretary of the interior, painted a stark picture of communities relocating and lives disrupted in her first official visit to Canada. The Arctic, which is warming at twice the rate of the global average, has just recorded its lowest recorded peak ice extent after what’s been called a “warm, crazy winter”.
“We will have climate refugees,” Jewell said. “We have to figure out how to deal with potentially relocating villages. There’s real tangible support we need to do from a government basis, working alongside indigenous communities as they make very difficult choices about what is right for them.
“We can’t turn this around. We can stem the increase in temperature, we can stem some of the effect, perhaps, if we act on climate. But the changes are under way and they are very rapid.”
The escalating Arctic temperatures, diminishing ice and rising sea levels are having consequences for humans as well as other animals such as polar bears and walruses. The ability to catch fish and travel – or even to hold the famed Iditarod dog sled race in Alaska – is at risk.
Jewell said the remote town of Kivalina in Alaska is “washing away”. The coastal town, located around 80 miles above the Arctic circle, has been visited by Barack Obama following warnings its 400-strong population will have to be moved due to thinning ice that exposes the town to crashing waves.
It’s a problem that is expected to be replicated elsewhere in Alaska and in Canada. Jewell said political leaders need to “act and support” efforts to make communities more resilient to climate change. US Republicans have, so far, opposed any funding to protect or relocate Alaskan towns.
“The changing climate isn’t just about melting permafrost, it’s having a huge impact upon cultures,” said Catherine McKenna, Canada’s environment minister, who met with Jewell in Quebec. “When your ice highway has gone, communities can’t interact. It’s having a huge impact upon food and food insecurity.”
McKenna said there is a “huge commitment to do more” from Obama and Justin Trudeau, Canada’s prime minister. The two leaders met in Washington DC in March to agree to help lead the world to a low-carbon economy and to bolster efforts to protect the Arctic and the people who live there.
Scientists expect the Arctic to be completely ice-free for at least a few days during the summer by the 2040s. The area of summer ice has shrunk by around 3m sq km since 1980.
The disappearance of this ice is set to open up new opportunities for shipping lanes through previously inaccessible areas, raising concerns over oil spills and further disruption to indigenous livelihoods.
Russia is preparing to sell its oil for anything but dollars. Meanwhile the collapse of the oil price is forаing financial reality on the Kingdom of Saud.
Taking The 'Petro' Out Of The Dollar
30 April, 2016
Saudi Arabia has been in the news recently for several interconnected reasons. Underlying it all is a spendthrift country that is rapidly becoming insolvent.
While the House of Saud remains strongly resistant to change, a mixture of reality and power-play is likely to dominate domestic politics in the coming years, following the ascendency of King Salman to the Saudi throne.This has important implications for the dollar, given its historic role in the region.
Last year’s collapse in the oil price has forced financial reality upon the House of Saud. The young deputy crown prince, Mohammed bin Salman, possibly inspired by a McKinsey report, aims to diversify the state rapidly from oil dependency into a mixture of industries, healthcare and tourism. The McKinsey report looks like a wish-list, rather than reality, particularly when it comes to tourism. The religious police are unlikely to take kindly to bikinis on the Red Sea’s beeches, or to foreign women in mini-shorts wandering around Jeddah.
It is hard to imagine Saudi Arabia, culturally stuck in the middle ages, embracing the changes recommended by McKinsey, without fundamentally reforming the House of Saud, or even without a full-scale revolution. Nearly all properties and businesses are personally owned or controlled by members of the extended royal family, not the state, nor by lesser mortals. The principal exception is Aramco, estimated to be worth $2 trillion.
The state is subservient to the House of Saud. It is therefore hard to see how, as McKinsey recommends, the country can “shift from its current government-led economic model to a more market-based approach”. The country is barely government led: a puppet of the Saudis is more like it. But the state’s lack of funds is making it increasingly desperate.
It was for this reason the Kingdom recently placed a $10bn five-year syndicated loan, the first time it has entered capital markets since Saddam Hussein invaded Kuwait. It proposes to raise a further $100bn by selling a 5% stake in Aramco. The financial plan appears to be a combination of this short-term money-raising, contributions from oil revenue, and sales of US Treasuries (thought to total as much as $750bn). The government has, according to informed sources, been secretly selling gold, mainly to Asian central banks and sovereign wealth funds. Will it see the Kingdom through this sticky patch?
Maybe. Much more likely, buying time is a substitute for ducking fundamental reform. But one can see how stories coming out of Washington, implicating Saudi interests in the 9/11 twin-towers tragedy, could easily have pulled the trigger on all those Treasuries.
Whatever else was discussed, it seems likely that this topic will have been addressed at the two special FOMC meetings “under expedited measures” at the Fed earlier this month, and then at Janet Yellen’s meeting with the President at the White House. This week’s holding pattern on interest rates would lend support to this theory.
The White House’s involvement certainly points towards a matter involving foreign affairs, rather than just interest rates. If the Saudis had decided to dump their Treasuries on the market, it would risk collapsing US bond markets and the dollar. Through financial transmission, euro-denominated sovereign bonds and Japanese government bonds, all of which are wildly overpriced, would also enter into free-fall, setting off the global financial crisis that central banks have been trying to void.
Perhaps this is reading too much into Saudi Arabia’s financial difficulties, but the possibility of the sale of Treasuries certainly got wide media coverage. These reports generally omitted to mention the Saudi’s underlying financial difficulties, which could equally have contributed to their desire to sell.
While the Arab countries floated themselves on oceans of petro-dollars forty years ago, they have little need for them now. So we must now turn our attention to China, which is well positioned to act as white knight to Saudi Arabia. China’s SAFE sovereign wealth fund could easily swallow the Aramco stake, and there are good strategic reasons why it should. A quick deal would help stabilise a desperate financial and political situation on the edges of China’s rapidly growing Asian interests, and keep Saudi Arabia onside as an energy supplier. China has dollars to dispose, and a mutual arrangement would herald a new era of tangible cooperation. The US can only stand and stare as China teases Saudi Arabia away from America’s sphere of influence.
In truth, trade matters much more than just talk, which is why a highly-indebted America finds herself on the back foot all the time in every financial skirmish with China. Saudi Arabia has little option but to kow-tow to China, and her commercial interests are moving her into China’s camp anyway. It seems logical that the Saudi riyal will eventually be de-pegged from the US dollar and managed in line with a basket of her oil customers’ currencies, dominated by the yuan.
Future currency policies pursued by both China and Saudi Arabia and their interaction will affect the dollar. China wants to use her own currency for trade deals, but must not flood the markets with yuan, lest she loses control over her currency. The internationalisation of the yuan must therefore be a gradual process, supply only being expanded when permanent demand for yuan requires it. Meanwhile, western analysts expect the riyal to be devalued against the dollar, unless there is a significant and lasting increase in the price of oil, which is not generally expected. But a devaluation requires a deliberate act by the state, which is not in the personal interests of the individual members of the House of Saud, so is a last resort.
It is clear that both Saudi Arabia and China have enormous quantities of surplus dollars to dispose in the next few years. As already stated, China could easily use $100bn of her stockpile to buy the 5% Aramco stake, dollars which the Saudis would simply sell in the foreign exchange markets as they are spent domestically. China could make further dollar loans to Saudi Arabia, secured against future oil sales and repayable in yuan, perhaps at a predetermined exchange rate. The Saudis would get dollars to spend, and China could balance future supply and demand for yuan.
It would therefore appear that a large part of the petro-dollar mountain is going to be unwound over time. There is now no point in the Saudis also hanging onto their US Treasury bonds, so we can expect them to be liquidated, but not as a fire-sale. On this point, it has been suggested that the US Government could simply block sales by China and Saudi Arabia, but there would be no quicker way of undermining the dollar’s international credibility. More likely, the Americans would have to accept an orderly unwinding of foreign holdings.
The US has exploited the dollar’s reserve currency status to the full since WW2, leading to massive quantities of dollars in foreign ownership. The pressure for dollars to return to America, when the Vietnam war was wound down, was behind the first dollar crisis, leading to the failure of the London gold pool in the late sixties. After the Nixon Shock in 1971, the cycle of printing money and credit for export resumed.
In the seventies, higher oil prices were paid for by printing dollars and by expanding dollar bank credit, in turn kept offshore by lending these exported dollars to Latin American dictators. That culminated in the Latin American debt crisis. From the eighties onwards, the internationalisation of business was all done on the back of yet more exported dollars, and wars in Iraq and Afghanistan echoed the earlier wars of Korea and Vietnam.
Many of these factors have now either disappeared or diminished. For the last eighteen months, the dollar had a last-gasp rally, as commodity and oil prices collapsed. The contraction in global trade since mid-2014 had signalled a swing in preferences from commodities and energy towards the money they are priced in, which is dollars. The concomitant liquidation of malinvestments in the commodity-exporting countries has been contained for now by aggressive monetary policies from China, Japan and the Eurozone. The tide is now swinging the other way: preferences are swinging out of the dollar towards oversold commodities again, exposing the dollar to a second version of the gold pool crisis. This time, China, Saudi Arabia and the BRICS will be returning their dollars from whence they came.
In essence, this is the market argument in favour of gold. Over time, the price of commodities and their manufactured derivatives measured in grams of gold is relatively stable. It is the price measured in fiat currencies that is volatile, with an upward bias. The price of a barrel of oil in 1966, fifty years ago, was 2.75 grams of gold. Today it is 1.0 gram of gold, so the purchasing power of gold measured in barrels of oil has risen nearly three-fold. In dollars, the prices were $3.10 and $40 respectively, so the purchasing power of the dollar measured in barrels of oil has fallen by 92%. Expect these trends to resume.
This is also the difference between sound money and dollars, which has worked to the detriment of nearly all energy and commodity-producing countries. With a track-record like that, who needs dollars?
It is hard to see how the purchasing power of dollars will not fall over the rest of the year. The liquidation of malinvestments denominated in external dollars has passed. Instead, the liquidation of financial investments carry-traded out of euros and yen is strengthening those currencies. That too will pass, but it won’t rescue the dollar.
Dollar, good-bye: Russia will sell oil for rubles
Доллар, гуд-бай: Россия будет продавать нефть за рубли
30 April, 2016
Ongoing reformatting of the domestic economy, finally came to the oil market. Yesterday, the Russian experts in an interview with Bloomberg was made an interesting statement.
After months of preparation Russia launches its own production of financial document for independent implementation of Urals oil. Thus, it will create an open system in which the oil is valued most fairly. Bidding will be held at the St. Petersburg international Mercantile exchange (SPIMEX) and negotiations are underway to establish cooperation with foreign partners.
By the way, SPIMEX is the largest Russian oil exchange platform, created in 2008 after the Government ordered companies to sell mandatory 5-10 per cent produced domestically. Annual turnover for 2015 of around 533 billion rubles ($7.8 billion), or more than 15 percent of the total fuel supplied to the domestic market
But most importantly, the rejection of pricing in dollars. From now on, Urals will be traded in the Russian national currency. This innovation will reduce the impact of fluctuating oil prices and stabilizes the market. Will also be reduced costs because you'll fail from the intermediate dollar currency.
Now, in order to attract traders, the Bank of Russia is preparing amendments to the legislation for granting foreign firms access to commodities and their derivatives.
"Russia is doing what failed other: the dollar loses its security of oil contracts. In the medium term, Moscow will increase revenues from oil sales. Piping to bypass the dollar of the enormous flow of trade, the authorities will seek to reduce the credibility of the us dollar and boost demand for the ruble, killing two birds with one stone".
This practice is the transfer of trade of petroleum operations on the national currency is not new. Norway concludes his transactions, only using the inner crown, saving yourself from a lot of expenses and risks, but at the same time strengthening currency in the global market.
Therefore, the Government of the Russian Federation makes a very thoughtful, and correct strategic move in the near future will show its fruits and positively affect the lives of every Russian.
Продолжающееся переформатирование отечественной экономики, наконец, дошло и до нефтяного рынка. Вчера российскими экспертами в интервью агентству Bloomberg было сделано весьма занимательное заявление.
После многомесячной подготовки Россия запускает собственный производственный финансовый документ для независимой реализации нефти марки Urals. Таким образом, будет создана отрытая система, в которой нефть оценивается максимально справедливо. Торги будут проводиться на базе Санкт-Петербургской международной товарно-сырьевой биржи (СПбМТСБ) и сейчас ведутся переговоры по налаживанию сотрудничества с зарубежными партнерами.
К слову, СПбМТСБ — крупнейшая в России нефтяной платформа-биржа, созданная в 2008 году после того как Правительство обязало компании продавать обязательные 5-10 процентов добытого внутри страны. Годовой товарооборот за 2015 — около 533 миллиарда рублей (7,8 миллиарда долларов), или более чем 15 процентов всего топлива, поставляемого на внутренний рынок
Но главное, отказ от ценообразования в долларах. Отныне, Urals будет торговаться за российскую национальную валюту. Подобное нововведение позволит снизить влияние колеблющихся цен на нефть и стабилизирует рынок. Также будут снижены издержки, поскольку произойдет отказ от промежуточной, долларовой валюты.
Сейчас, для того, чтобы привлечь трейдеров, Банк России готовит поправки в законодательство о предоставлении иностранным фирмам доступа к биржевым товарам и их производных.
«Россия делает то, что не получилось у других: доллар лишается основы своего обеспечения — нефтяных контрактов. В среднесрочной перспективе Москва увеличит доходы от продажи нефти. Пуская в обход доллара колоссальные потоки товарооборота, власти будут стремиться уменьшить авторитет американской валюты и повышать спрос на рубль, убивая сразу двух зайцев».
Подобная практика перевода торговых нефтяных операций на национальную валюту не нова. Норвегия заключает свои сделки, используя лишь внутреннюю крону, избавляя себя от множества расходов и рисков, а заодно укрепляя валюту на мировом рынке.
Посему, Правительство РФ делает весьма продуманный, правильный и стратегический шаг, который уже в ближайшем будущем покажет свои плоды и благотворно отразится на жизни каждого россиянина.
Obama Admin Denies Saying “No Boots On The Ground” in Syria After Saying It 16 Times
30 April, 2016
[I]n no event are we considering any kind of military action that would involve boots on the ground; that would involve a long-term campaign.
After careful deliberation, I have decided that the United States should take military action against Syrian regime targets … We would not put boots on the ground.
First, many of you have asked, won’t this put us on a slippery slope to another war?
My answer is simple: I will not put American boots on the ground in Syria.
[The U.S. involvement in Syria] does not involve boots on the ground.
Tomorrow, I’ll speak to the American people. I’ll explain this is not Iraq; this is not Afghanistan; this is not even Libya. We’re talking about — not boots on the ground.
In Syria, the boots on the ground have to be Syrian.
The resolution we’ve submitted today does not call for the deployment of U.S. ground combat forces to Iraq or Syria.