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Record cold temperatures in Europe disprove global warming?

January 8, 2010 Leave a comment

Remember when “climate scientists” (climate zealots) tried to “prove” global warming by pointing to record high temperatures in Australia and Europe last year?

What are they doing now that Europe and North America are experiencing one of the worst winters on record, with Scotland going down to an Arctic -21 degrees?

Well, now they are saying recent cold temperatures in Europe don’t disprove global warming.

I would be fine with that if they hadn’t already pointed to recent high temperatures as proving the existence of global warming.

Could the climate guys be any dumber?  First, they schedule a conference on global warming in Copenhagen in the middle of winter.  Then, they point to recent high temperatures as proving global warming but run away from the implications of the record cold snap in Europe.  Then, they display unbelievable cynicism about the whole process of science by cooking the books on climate science. Then they try to deny the cover-up. 

The whole thing is sad.

If this is what academics spend their time doing, I’d prefer it if they all got new jobs in some more reputable, productive profession.  Like porn, or drug trafficking.  At least in those industries you have to deliver a real product with a real bang.

Meanwhile, whilst Labor govts in Oz are killing farmers in NSW…

January 8, 2010 Leave a comment

Jim Rogers is screaming that soft commodities are the Buy of the Century and that arable land will be as precious as gold in coming decades.

Speculation in agricultural commodities may not have reached fever pitch yet but with food shortages expected in 2010, it could.

Jim Rogers, one of the world’s most astute investors has been bullish on commodities in general for several years. On agricultural (or soft) commodities, he says: ‘Food inventories worldwide are at the lowest in decades as the world continues to consume more than it produces. We even have a shortage of farmers now since agriculture has been such a terrible business for three decades. We should all hope prices go higher or there may soon be a time when there will be little or no food at any price.’

Mr Rogers, who created his own commodities indices, has put his name to several index funds. The Elements Jim Rogers International Commodity Index Agriculture Total Return which is listed on the New York Stock Exchange has, for instance, risen by about 6 per cent since the start of 2009.

Interest in soft commodities has had an impact on prices.

‘Whenever there are buyers of anything, it affects the prices. For example, if you live in an apartment or house, you are affecting the price of housing in Singapore,’ adds Mr Rogers.

There are several ways to invest in soft commodities including the futures contracts on commodities exchanges like the Chicago Board of Trade (CBOT).

The index funds alluded to by the FAO include the more rarefied market of exchange traded funds (ETFs) that typically attract institutional investors.

There are more prosaic ways as well.

In China, the bubble people are talking about now is not in real estate but in garlic.

Worries about persistent swine flu prompted a spike in garlic consumption in 2009 and soon, everyone was hoarding it in hopes of making a quick buck. Prices are said to have gone up by 50 per cent in the last few months.

Rice could be next. Barclays Capital Research economist Leong Wai Ho says: ‘The bigger problem for food prices is an old one – physical hoarding that can limit physical availability, unlike derivative trading.

‘Rice prices are now at levels that are likely to induce physical hoarding in Vietnam and Thailand. And also in stricken countries – authorities in Southern Guangdong have introduced anti-hoarding measures in the wake of the ongoing drought.’

And Mr Leong also believes the significance of food prices may not have been factored into inflation either.

For 2010, the Singapore government’s inflation forecast has been revised from 1-2 per cent to 2.5-3.5 per cent. Citing rising Thai fragrant rice prices, the prospect of El Nino weather conditions, higher import demand from Asian countries, Barclays’ 2010 inflation forecast for Singapore is higher at 4 per cent, up from 1.5 per cent previously.

Still, the verdict is out on how this will impact the economic recovery.

‘I don’t think there will be a meaningful impact on growth,’ says Mr Leong. ‘While the monetary policy stance will be tightened from where it was before, the overall policy stance will still be largely accommodative in 2010. The exchange rate will be used to lean into imported inflation, while liquidity will still remain flush and fiscal policy still expansionary,’ he added.

Economists will nevertheless be ‘keeping an eye’ on food prices.

What a great move for the Labor govts in Oz to grant mining rights to the barbarians at BHP and the other Neanderthal low-IQ Big Miners over the most fertile arable land in both NSW and Qld, just at the time when sugar prices are at historic highs and every astute investor is screaming that farmland is a buy.  If we had any brains we’d be hoarding our minerals until prices spiked in a decade, and we’d be focusing on innovation in solar power and recycling technologies instead of digging dirty ditches and selling our precious metals for worthless paper.

But no, let’s sell everything we’ve got RIGHT NOW!  What forethought, what genius, what planning, what brilliance!  Well done, Rudd, well done Bligh, well done what’s-her-name-puppet-of-the-Labor-Right-in-NSW!

This proves conclusively to me that (1) there is no God and (2) the NSW and Cth govts are infested with the dumbest people on this God-forsaken planet.

Marc Faber reassures me that we are doomed

December 21, 2009 Leave a comment

It’s mildly reassuring when another analyst is suicidal about the future.  It reassures me that I am not totally alone.

I disagree with Faber on two points however. 

First, it’s unlikely we will see hyperinflation and the “pure” monetisation of the trillions in US debt.  No hyperinflationist thinks through the precise mechanism of monetisation.  To increase the budget deficit by even more, the US govt will have to increase its own debt levels.  Bonds yields will likely spike at some point.  Then the Fed will try to buy the bonds to keep prices up (yields low).  This will allow relatively limited leakage of money to the US govt’s friends, but in no way plug the hole left by the collapse in the housing bubble.  Not only will govt spending not replace the hole left by Peak Credit, govt spending further distorts the economy, resulting in more failed private businesses the further away you get from the US govt’s largesse. 

You’ll end up with millions of debt-slaves sycophantically praying to the bankers and the Fed govt, running around doing the bidding of their Masters, and economic chaos and widespread starvation beyond the tiny green gated communities of bankers and govt employees.

Kabul is a good future model for the major Western economies (especially the US): There are some massive luxury (tasteless!) villas going up in Kabul.  I’ve seen them.  They are the houses for the govt ministers and associated hangers-on from the opium trade.  Nearby are the hotels the UN employees frequent.  Beyond these few blocks, hundreds beg for food from aid agencies and there’s complete chaos.  But within these tiny communities connected close to the corrupt govt, the opulence is incredible.  Govt banquets are frequent, whilst literally right outside the banquet halls, local Afghanis are starving.

That is our future.  Kabul is our future. 

And remember – Kabul is a city now created by the US.  It is what the US govt “wanted” to create (or at least what it did create after taking over). 

So that’s the best the US and UK govts can do today when “creating” a city.  That’s the proof regarding what they are capable of.  Sad, but true.

So that’s what they will continue to produce at home.

“Kabul” does not spell hyperinflation to me.  It spells stag-deflation with a possible sudden depreciation of the US dollar at some point – but not hyperinflation.  So I still think US govt bonds and gold are a better bet than US stocks if I was forced to choose.  Of course, long-term, farmland, security services, and govt jobs will all be highly sort after.  But I wouldn’t be buying canned food just yet.  You don’t want it to go out-of-date before you need to eat it.

Second, there will be war, but it won’t be to distract people from their debt problems.  It will be over the rapidly diminishing supply of food and water and oil.  The malinvestments caused by the decade-long low-density housing boom in the West have actually caused massive environmental destruction as well as financial chaos.  Literally millions of acres of fertile arable land across the US and Australia and other countries has been re-zoned and “redeveloped” (destroyed) for what is euphemistically termed a “more intensive use” (i.e. “for speculative property development”) – just at the time when unprecedented climate change has destroyed many “food basins” around the world (Myanmar, Thailand, Cambodia, Australia, China, Europe and the US have all experienced tsunamis, typhoons, hurricanes or drought in their vital farming areas).

CCD is also a massive threat to our food supply.  It is still a problem that no media organisation wants to talk about.  The cause is unknown (I suspect GM crops, but who knows?).

No one seems to have connected up the housing boom and bust with massive unprecedented and irreversible environmental destruction. 

But they will.  Eventually.

“All Labor” govts deliver 100% failure

December 21, 2009 Leave a comment

Remember when “all Labor” Cth and State govts were finally going to “deliver” in contentious areas such as water rights, health and tax sharing?

Finally, there would be “no excuses” to deliver on these vital issues of national long-term interest.

Ha Ha Ha.

Paul Sheehan comments on the complete failure of that idea in today’s SMH, at least as it applies to the environment and water rights.

Last week I received shocking photos of the Wyangala Dam, which once held several times the volume of Sydney Harbour but is now reduced to a chain of brown pools. The Lachlan River, which once fed a majestic floodplain with regular healthy flooding, has been blocked off below Condobolin to ensure water supplies for the town. This has never happened before. A rich flood plain has become an arid zone.

We don’t have to wait for global warming for adverse climate change in Australia. It’s already here, and all man-made. The landscape of the Murray-Darling Basin was changed on a large scale, and the climate of the Murray-Darling Basin has changed.

With Labor in power in Canberra and every state except Western Australia, it was logical to expect a policy pay-off over an issue as crucial as water. But no. The National Water Commission recently issued its biennial assessment of the national water initiative and the report reads like a horror novel if you read between the lines of the report’s cautious sober language.

The commission, charged with saving the Murray-Darling Basin from the massive over-allocation of water rights by state governments to irrigators, has encountered a morass of inertia caused by jurisdictional complexity, bureaucratic infighting and state parochialism. On the most important single issue facing the nation – water security – federalism has failed. NSW and Queensland are replaying the State of Origin tribal warfare, except that the stakes are real and enormous.

The Water Commission’s chairman, Ken Matthews, allowed himself some venting in a recent speech when he referred to the ”bickering, arguing and delaying” by state governments. And these are all Labor governments.

To make the problem worse, these same governments have been busy granting mining leases for projects that could need as much ground water as will be saved from the river system by the $10 billion the Federal Government is spending to buy back water rights from irrigators.

Coal-mining leases have been granted, or applied for, over 16,000 hectares in the Maranoa, Balonne and Condamine river basins in Queensland. Petroleum leases have been granted, or applied for, over 23,000 hectares of these same basins.

”One-third of the Murray-Darling Basin is in Queensland where a massive increase in mining for coal, petroleum and liquid natural gas is under way,” said Kathy Ridge, a member of the Basin Community Committee which advises the Murray-Darling Basin Authority.

”There are currently eight liquid natural gas projects proposed in Queensland with a total capital expenditure in excess of $40 billion. If all of the projects were to proceed, their water consumption would amount to almost half the total amount of water entitlements purchased [by the Federal Government] to return environmental flows to the Murray Darling River …

”The water that comes out of mining is heavily polluted with salt and other heavy metals. No one knows what to do with it apart from evaporating it in huge storage dams, causing ongoing water and land pollution.

”NSW is similarly for sale when it comes to mining, particularly coal seam methane, and much of the prospecting for coal-seam methane gas occurs on prime agricultural land, or land with high conservation values.”

Over the next 30 years, governments in Canberra, Sydney and Brisbane expect to receive about $40 billion in royalties from these mines, but these royalties will not cover the economic costs to repair the ecosystem. That cost will be carried by the taxpayer, and absorbed by the environment.

Incoherent environment policy is further personified by the Federal Government ramping up Australia’s emissions with the largest immigration program in Australia’s history – a policy unmentioned during the 2007 election campaign – while at the same time talking about reducing emissions with a massive carbon trading scheme.

Carbon trading is a system dismissed by the world’s most influential scientist on global warming, James Hansen, who, as director of the Goddard Institute for Space Studies in New York, essentially invented and popularised the concept of human-induced global warming.

Hansen believes carbon trading schemes, especially those as complex and compromised as the scheme proposed by the Rudd Government, are misguided: ”These cap-and-trade trading schemes are a terrible idea. They are a way to continue business as usual … ”

Business as usual is exactly what the Rudd Government, the unions and the Labor patronage machine are all about. The soaring rhetoric about climate change is just carbon emission.

Having our water table at the mercy of Queenslanders is so frightening I’m almost going to take the Lithium the doctors have recommended for me.  I have not met one Queensland environmentalist.  Put a $ bill in front of any Queenslander and they seem to reflexively salivate like one of Pavlov’s dogs.  The granting of new mining rights in these vitally important areas is MADNESS. 

Allowing mining on fertile arable land, near our national water table is MADNESS.

But never underestimate the madness of a govt deep in debt and looking for any way out.  Will the Queensland govt prostitute our children’s futures to the mining industry for some filthy lucre to pay off the debts they’ve stupidly accumulated, rather than negotiating a sensible way out directly with the major creditors and the Cth govt? 

Apparently, yes.

Sad.

Another Aussie environmental disaster in the making, this time 100% Labor-made.

This does not make me proud to be an Australian.

Beds are still burning

December 20, 2009 Leave a comment

Peter Garrett must think we’re monkeys.

Government suppression of the appalling pollution still resulting from the oil spill off NW WA has been truly impressive.  It’s like it never happened.

Have you heard of any updates on the story since August 2009?  Have you heard whether or not Indonesian fishermen’s allegations regarding aged oil still appearing in Indonesian waters is correct?  Have you heard whether the leak has been completely plugged?  Have you heard when the investigation will start as to the cause?  Have you heard whether PTTEP will continue to enjoy access to mining rights in Australia?

No, I haven’t either.

All we got after the leak was (supposedly) plugged was a SINGLE GRAINY STILL PICTURE (no live shots or video) of a burnt out oil platform and soothing words from the govt that the leak had been contained.  That’s it.  End of story.

I have a few additional questions for those with longer memories (longer than 5 minutes that is):

1.  Has the leak been proven to have been completely plugged or is there evidence of leaks still continuing?

2.  Why has no video footage been released of the oil rig?  Can the media now have access to the area?  If not, why not?

3.  How long will it take for the investigation to start?  The longer this drags on the more likely evidence of culpability will be covered up.

4.  Has the govt accepted liability for any damage to Indonesian fisheries arising from the spill?  What is the estimated compensation?  When will this be determined?

5.  Has any preliminary study been done of the ecological damage caused by the spill?  If not, why not?

6.  Will any long-term study be undertaken of the potential after-effects, such as contamination of sea life and potential contamination of our own food supply?  Have there been any recommendations regarding the banning of fishing in the waters surrounding the oil spill?  If not, why not?

7.  What is ASMA doing to ensure the risks of future accidents such as this one are reduced?  What recommendations have ASMA issued to oil rig owners?  What investigations or compliance visits will be done by ASMA in the coming months on oil rigs, if at all?  Who at ASMA is taking responsibility for the oil spill?  Anyone?  Or was it an “act of God” in ASMA’s view?

John Quiggin on Plimer

December 18, 2009 Leave a comment

JQ goes after Plimer.  Again.

I am no great admirer of Plimer.  Why JQ wants to lump all critics of an ETS as right-wing psychopaths robotically parroting the same point of view is beyond me.

I have the following issues to raise with JQ (of course he won’t respond, but my frustration compels me to act):

1.  George Monbiot admits he is ashamed and embarrassed as a scientist regarding Jones’ (and other climate scientists’) attempts to suppress contrary research, to “mould” the debate to suit their agenda and their cynicism regarding the whole process of science.  Is JQ equally ashamed?

2.  If scientists are willing to plunge to these depths, what integrity can we expect from the political process regarding an ETS, which is much more corrupt and is subject to rent seeking pressures?

3.  Even if Plimer is a madman financed by the mining industry (neither of which I accept) what has this got to do with the efficacy of an ETS in tackling climate change?  Satyajit Das (noted derivatives expert and trader) has come out on Phillip Adams’ LNL in support of a carbon tax NOT an ETS.  He thinks an ETS would be subject to corruption and wouldn’t achieve the goals needed on climate change.  Is he mad too?

4.  Why the focus on climate change when dry land salinity, phosphate depletion, the destruction of farm lands in WA and in central NSW, irrigation rights, the destruction of the Murray-Darling Basin are all more pressing issues?

Name one recent government innovation or policy that has “worked” regarding the environment. 

$2 billion in free insulation?  Corruption, deaths from faulty installation… requiring govt to step in and regulate the industry even more because of govt incompetence in the first place. 

Reserving land for climate change?  Farmers are protesting in NSW (one is on a hunger strike) because of the effect this policy has had on farmland.  This amounts to compulsory acquisition of land without compensation – a violation of the Constitution.  No one seems to care.  Certainly not from the NSW or Federal govts.

Everywhere govt goes, disaster, corruption, incompetence and rent-seeking parasites seem to follow.

Does anyone see a pattern here?

Baiji “fundamentals”

December 17, 2009 1 comment

This is going to be an even “crazier” post than usual, so please keep up with me and just go with the flow for a little while and hopefully things will make sense at the end.

Assume you’re a fan of freshwater dolphin meat.  I know you’re not, but just go with me here.  Assume you’re also an investor.

The “fundamentals” regarding freshwater dolphins from an “investor” perspective are very good.  The baiji on the Yangtze are dying due to their food source (fish) being massively overfished and appalling pollution problems contaminating the Yangtze from China’s industrialisation.  Some have declared that the baiji are “functionally extinct.”

As an investor, it would be wise to try to “invest” in baiji, wouldn’t it?  Supply down, demand either steady or up (on anticipation of limited supply).  Price should be higher.

Two points immediately need to be addressed from this hypothetical.

First, for those who think it’s “distasteful” to even consider valuing dolphins in terms of their meat, I say to you – think it through carefully.  The harsh reality of life is that animals and plants which are useful to humans are “protected” by humans and flourish. 

Those with no value to humans are vulnerable to extinction.

This has been proven time and time again throughout modern history.

I don’t like this either, and I wish the human population would not grow exponentially.  Then again, I wish I was a dictator so I could turn this loser nation of overconsuming mindless debt-drones on to a more sustainable path of development.  In both cases, I’m dreaming. 

We have to deal with reality.

And the reality is that animals that we can eat survive in this crazy world much better than animals that serve us no purpose. 

The absolutist thinking of so-called conservationists drives me crazy.  This kind of “leave alone!” thinking is naive and dangerous and infects so much of the environment movement.  I cannot believe their basic naive stupidity.

The ban on the sale of elephant tusks in my mind is crazy.  Elephants have become less valuable to local communities in Africa.  Elephants “compete” for arable land.  Guess what’s going to happen when you ban the sale of elephant products?  There’s going to be ongoing tension between local communities and international organisations who don’t have to live with the problem (and who coercively scream for a ban on the sale of anything elephant related).  Ultimately, the local communities will have even more of an incentive to kill the elephants and not help sustain the elephant population.  What do you think is going to happen over the long-run? 

Obviously, land will be taken over by local communities in need of food.  Elephants will die due to lack of natural habitat.  They will not have been “killed” literally by a gunshot, so the zealots in the international conservation organisations will be silent.  But the elephants will die just as surely as if they had been killed for their tusks.

Same with whaling.  Why we are so paranoid about Japanese whaling I will never understand.  We overfish, we pollute the waters with oilspills, chemicals, toxic sludge and refuse, we kill the natural habitat of the whales with a massive toxic plastic waste dump in the middle of the Pacific Ocean – and yet we criticise the Japanese for “hunting” the poor whales.  We kill them slowly but just as surely through starvation, through the destruction of their natural habitat, but because that’s one step removed, because it doesn’t involve a direct bullet to the head, somehow everyone is OK with that.  But when the Japanese actually kill a single whale – whoa… that’s barbaric! 

I can’t stand this hypocrisy, this stupidity, the childish incapacity to directly connect up destruction of natural habitat with the death of an animal.  As an animal I’d prefer the quick and relatively painless death of a bullet to the head (safe in the knowledge that some of my family would survive and possibly even by protected by my killers) rather than a slow and excruciating and depressing death by starvation and destruction of my whole natural habitat, grieving knowing my children will slowly but surely starve to death, perhaps be forced to eat toxic plastic… knowing that none of us will survive. 

Which would you prefer, if there was no other choice?  And don’t say there’s a third choice.  There isn’t. 

Unless humans agree TODAY to stop all human reproduction and start consuming less, there is no third option.

Given this sad reality, I have another invariable rule for environmentalists to consider:  Once an animal is valued by man, it is protected by man.

Sheep outnumber New Zealanders for a reason – sheep are valuable.  New Zealanders take care (good care) of their sheep. 

Kiwi birds can’t be eaten.  They have no direct intrinsic value.  They are difficult to spot in their natural habitat so they are not even valuable from a tourist perspective.  Guess what – they are dying and are nearly extinct.

So discussing dolphin meat for me is perfectly reasonable.  Ironically, if freshwater dolphin meat was more valuable perhaps the baiji would not be functionally extinct today.

But this is not even the main point of this post.

Let’s continue with this thought experiment. 

In a superficial sense, you would think as a naive investor (supply down, demand up) that somehow “getting into” freshwater dolphins would be a good idea.  BUT THE WHOLE HABITAT OF THE DOLPHIN IS BEING WIPED OUT.  This is not a matter of being able to “invest” in dolphins.  What we are witnessing in the case of the baiji, I’m sure you would agree, is inevitable extinction.

Similarly, Jim Rogers consistently states that the “fundamentals” for agriculture are incredibly positive.  He states that investors should get into agriculture.  Supply is down.  Demand (with population growth and rising Asian incomes) will inevitably go up.

Although I respect Jim Rogers as an investor, this shows his limited thinking, his inability to see the full implications of the trends here.  He has spent his whole life as a commercial trader and investor, not as a social scientist or economist or philosopher.  He sees the problem, thinks in terms of supply and demand and then concludes that investment in agriculture is a good idea.

I beg to differ.  Although I respect Jim Rogers as an investor, I don’t respect him as a deep thinker.

My view is that we are watching EXACTLY THE SAME PROCESS AS THE EXTINCTION OF THE FRESHWATER DOLPHIN, APPLIED TO HUMANS!

Overfarming cannot be reversed.  Topsoil is irreplaceable.  Phosphates, once lost, cannot be replaced if there is no supply.  The water table once polluted cannot ever be cleansed of chemical toxins.  Destruction of arable land is in most cases irreversible.

The price mechanism cannot transform houses into farmland, cities into arable land.  Once destroyed these things (vital for our very survival) cannot ever be put back in place. 

Similarly, once the freshwater dolphin is extinct no amount of hedge fund investment is going to get its natural habitat back.

So Jim Rogers is right to see the trend, but he hasn’t worked out the full implications. 

WE ARE ACTUALLY WATCHING THE DESTRUCTION OF OUR OWN FOOD SOURCE.  WE ARE WITNESSING BEFORE OUR VERY EYES THE DESTRUCTION OF OUR OWN HABITAT.  WE ARE INEXORABLY CAUSING OUR OWN EXTINCTION.

If you think I’m crazy, please read this article and this previous post and then tell me you’re 100% confident that governments and investors will get us through this little problem.

Sometimes the price mechanism has become so corrupted by bankers and governments that the warning bells don’t go off until it’s too late

I don’t believe we are watching a “bull market” in agriculture.

What we are watching is the massive extinction of our various food sources, resulting in a massive food crisis for the (much higher!) human population in a few short decades.

No amount of hedge fund money will turn Asian cities back to rice paddies, Western suburbs back into farmland, or polluted toxic African mining towns back to unspoilt Savannah.

It’s already too late, in my view.  The trends are “locked in”. 

We are the next freshwater dolphin.   We are killing ourselves.  Climate change, if it exists, will simply accelerate this process.

Those institutions supposedly designed to “forward plan” us out of this mess also happen to have control of the guns.  History records that when a crisis hits, governments turn from protector to predator, plundering the people for food.  Chile.  Zimbabwe.  Cambodia.  Talk to indigenous peoples in Australia, in New Zealand, in Hawaii, in North America, in South America, in Asia, in Africa about what elite governments do to those they supposedly have a duty to protect.

Sorry, that’s right. You can’t.

Because they’re already dead.