Fun With Fracking

“A truck carrying drill cuttings from a fracking site set off a radiation alarm at a landfill in Pennsylvania. Emitting gamma radiation ten times higher than the permitted level, the waste was rejected by the landfill.

After the alarm went off, the MAX Environmental Technologies truck was immediately quarantined and sent back to the Marcellus Shale fracking site it had come from in Greene County, Va. The 159-acre Pennsylvania landfill site accepts residual and hazardous waste, but the cuttings were too radioactive for the site to safely dispose.

The Pennsylvania landfill, located in South Huntingdon, rejects waste that emits more than 10 microerm per hour of radiation. The fracking materials were found to emit 96 microerm per hour of Radium 226 – a rate that is 84 times higher than the Environmental Protection Agency’s air-pollution standard and ten times higher than the landfill’s permitted level, Forbes reports.

Exposure to the materials taken from the fracking site can have serious health consequences, including the risk of developing cancer. The high level of radiation emitted by the materials serves as alarming news for environmentalists and residents located near hydraulic fracturing sites across the US.

“Long-term exposure to radium increases the risk of developing several diseases,” the EPA writes. “Inhaled or ingested radium increases the risk of developing such diseases as lymphoma, bone cancer and diseases that affect the formation of blood, such as leukemia and aplastic anemia… External exposure to radium’s gamma radiation increases the risk of cancer to varying degrees in all tissues and organs.”

The drill cuttings have been sent back to the well pad where they were extracted. The production company, Rice Energy, must now apply to have the waste discarded at other landfill sites that accept materials with higher levels of radiation….”

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Well perhaps ghost money is not really your money….but the fun is there indeud!

“April 29 (Reuters) – Tens of millions of U.S. dollars in cash were delivered by the CIA in suitcases, backpacks and plastic shopping bags to the office of Afghanistan President Hamid Karzai for more than a decade, the New York Times says, citing current and former advisers to the Afghan leader.

The so-called “ghost money” was meant to buy influence for the Central Intelligence Agency (CIA) but instead fuelled corruption and empowered warlords, undermining Washington’s exit strategy from Afghanistan, the newspaper quoted U.S. officials as saying.

“The biggest source of corruption in Afghanistan”, one American official said, “was the United States.”

The CIA declined to comment on the report and the U.S. State Department did not immediately comment. The New York Times did not publish any comment from Karzai or his office.

“We called it ‘ghost money’,” Khalil Roman, who served as Karzai’s chief of staff from 2002 until 2005, told the New York Times. “It came in secret and it left in secret.”

There was no evidence that Karzai personally received any of the money, Afghan officials told the newspaper. The cash was handled by his National Security Council, it added.

In response to the report, Karzai told reporters in Helsinki after a meeting with Finnish leaders that the office of the National Security Council had been receiving support from the U.S. government for the past 10 years. He said the amounts had been “not big” and the funds were used for various purposes including assistance for the wounded….”

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“We’re getting deeper and deeper into the experiment now known as “Abenomics” in Japan.  Ultimately, the plan is designed to defeat the decades of deflationary pressures in the Japanese economy.  They’ve announced a massive fiscal plan, an official 2% inflation “target” a doubling of the BOJ’s balance sheet and as a result the Yen has declined 30% in a matter of months and the Japanese stock market has surged over 60%.  By the looks of the market reaction you’d think that something had not just changed, but that we’d be looking at a new economy entirely.

But the latest CPI report shows that the deflation is actually WORSENING.   The Statistics Bureau in Japan reported that Japan’s National Core CPI fell to -0.5% in march, down from -0.3%.  This was worse than expectations of -0.4%.  The headline rate fell to -0.9% versus expectations of -0.8%.

The latest reading is the worst reading since 2010.  In fact, it’s the worst reading this year and down almost 1% from when the aggressive Japanese easing was first announced.  In other words, if Abenomics is inflating prices it certainly isn’t working in the real economy and appears to only be “working” where gamblers are placing bets that it will eventually show itself….”

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“Google’s mobile OS Android continues to power ahead as the world’s most popular smartphone platform, according to figures out today from Kantar Worldpanel Comtech, the WPP-owned market research company that tracks sales of handsets across key markets on a 12-week rolling cycle. In the nine markets surveyed by Kantar — Australia, China, France, Germany, Italy, Japan, Spain, UK and the U.S., all detailed in the table below — Android on average accounted for 64.2% of all handset sales in the 12 weeks that ended March 31.

The only market where Android did not dominate was Japan, where Apple’s iOS just about eked out a lead against it (49.2% versus 45.8% of sales) for the three months ending March 31. Elsewhere, the figures indicate that regardless of whether the market is developed (U.S., UK, Germany) or emerging (China) or struggling financially (Spain), collectively, Android handset makers are winning them all, with sales figures for the platform reaching their high point in Spain, at 93.5% of all smartphone sales.

As you can see below, when it comes to smartphone penetration of actual devices in use, Android is leading everywhere.

Kantar — which bases its figures on (as samples) 240,000 interviews annually in the U.S. and some 1 million across Europe — believes that Android’s lead will only grow more in the months ahead, with the ongoing roll out of two new Android handsets, the Galaxy S4 from Samsung and the HTC One, driving sales of the platform.

“We expect to see a further spike in [Android’s] share in the coming months, as sales from the HTC One start coming through and the Samsung Galaxy S4 is launched,” writes Dominic Sunnebo, global consumer insight director at Kantar Worldpanel ComTech. “This will pile pressure on Apple, BlackBerry and Nokia to keep their products front of consumers’ minds in the midst of a Samsung and HTC marketing blitz.” …”

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“Today at Disrupt NY 2013, Benchmark partner Bill Gurley shared an interesting fact aboutUber. “Uber is growing faster than eBay did,” Gurley said. In 1997, Benchmark invested $6.7 million in eBay. It was worth more than $5 billion less than two years later. Benchmark is also an investor in Uber.

“Uber is probably the fastest growing company that we’ve ever had,” Gurley said. He insisted a lot on the quality of the product. If a company builds a good product, it will grow organically.

Benchmark took part in Uber’s Series A and Series B rounds of respectively $11 million and $37 million. Gurley seemed very satisfied with this investment and only had good things to say about the car company.

“The product is so good, there is no one spending hundreds of thousands of dollars on marketing,” Gurley said. eBay and Uber are both consumer companies that have reached a lot of customers in a very short time….”

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“DETROITChrysler says its first-quarter net profit fell 65 percent as it shipped fewer older vehicles in preparation for several key product launches.

The company earned $166 million in the January-March quarter, compared with $473 million a year ago. Revenue fell 6 percent to $15.4 billion….”

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“PLANO, TEXASJ.C. Penney (JCP) is confirming that Goldman Sachs (GS) will provide it with $1.75 billion in financing, sending shares up 3 percent in trading.

Rumors about the financing had begun to circulate Friday. J.C. Penney shares were up 2.2 percent, to $17.38, in morning trade, although that remains well below the stock’s 52-week high of $36.89….”

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“The Dallas Fed’s monthly survey of regional manufacturing activity is out.

The headline index plunged to -15.6. Economists expected +5.0 after last month’s +7.4 reading.

Below is the full text from the release….”

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“Slowing inflation is giving central bankers scope to provide the world economy with more liquidity and lower interest rates for longer, all in the name of price stability.

European Central Bank President Mario Draghi may cut his benchmark rate to a record low as soon as this week as ebbing price pressures let him deliver more stimulus to the euro area’s recession-riddled economy. Federal Reserve Chairman Ben S. Bernanke at a policy meeting that starts Tuesday might have more room to press on with asset purchases as the argument against that strategy is undercut by waning inflation risks. Their counterparts from New Zealand to Canada also have more reason to keep policy loose.

The odds of disinflation are mounting as the world economy slows anew and commodity prices slide, defying forecasts that easy money would trigger an acceleration of prices. More than half of the world economy, including the U.S. and the euro area, instead confronts inflation below the central banks’ desired levels, according to Ethan Harris, co-head of global economics research at Bank of America Corp. in New York.

“There is a developing inflation problem: undesirably low inflation,” said Harris, a former Federal Reserve Bank of New York economist. “For central banks, this increases the pressure to maintain super-easy monetary policy.”

Deflation Danger…”

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“In 2007 a small number of French hedge funds imploded over sudden losses stemming from highly leveraged bets made on the unstoppable subprime mortgage market. At the time, a few saw the writing on the wall; but many simply wrote it off as just another over-levered hedge fund and the subprime mortgage market was ‘fine’. Fast forward six years and as we have discussed numerous times (most recently here and here) there is a bubble, potentially far bigger than subprime, in student loan debt. As one of the last remaining outlets for state-sanction credit creation, this is a big deal; but, of course, the popping of the bubble (or even a slight leak) is eschewed since there is so much ‘reach for yield’ and the Fed’s got your back. That is until this week. As WSJ reports, Sallie Mae (SLM), the nation’s largest non-government student lender just cancelled a $225 million debt offering as investors  decided they simply were not getting paid enough for risk – amid rising student loan defaults. Simply put, there’s a limit to what investors will tolerate.

SLM was offering a stunningly low 3.5% interest on the deal and investors snubbed it, “There are certain limits that can’t, or shouldn’t, be crossed if you’re an investor,” adding that, “we’re beginning to see what the tolerances are.” This is a significant shift since SLM and other issuers of debt backed by student loans sold $7.8 billion worth of securities this year through last week, up from $5.7 billion in the same period of 2012. With the portion of student borrowers who are late on their debt payments by 90 days or more climbing to 31% in 2012, from 24% in 2008; we wonder if this is the tipping point for the student debt in 2013 that was generally ignored in subprime in 2007, until it was too late.

Via WSJ….”

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“Despite expectations that following several months of subpar income growth offset by rampaging spending and thus a plunging savings rate, March incomes would rise by 0.4%, while spending would be flat, this did not happen, and instead both spending and incomes rose by the same amount, or 0.2% in the past month. Worse, when adjusting for inflation, real disposable income rose just 1.1% compared to last March, and just barely above the 0% breakeven. On the other side, real spending was up 2.2% Y/Y just barely above the 2% recessionary threshold. And even that number is misleading as spending on Total Goods (including durable, already known as being quite abysmal, and non-durable), dropped by $32.8 billion in nominal dollars. What was the offset? Why a massive surge in consumption expenditures on services, which rose by $53.8 billion, which absent the spending aberation for September 11, 2001, which was reversed in the following month, was the biggest monthly increase on record! What drove this record services spending spree is anyone’s guess.

Durable Goods spending- down:

Non-Durable spending- also down:

… but Services Spending- up, up, up… Record up in fact:

Real disposable income: oops.

Finally…”

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“The March reading of pending home sales is out.

Sales jumped 1.5% from last month.  Economists were looking for a 1.0% gain.

However, February’s reading was revised down to -1.0% from an initial reading of -0.4%…”

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“MADRID—Banco Santander SA SAN.MC +1.92% announced the resignation of Chief Executive Alfredo Sáenz, following a wave of criticism of a recent move by the Spanish government to relax its standards of conduct for bankers to allow Mr. Sáenz to keep his job despite a criminal conviction.

A spokesman for Spain’s central bank, the Bank of Spain, said the announcement Monday was a “positive step” that should have a “favorable effect on the stability of Spain’s financial sector,” but didn’t amplify on the reasons for the resignation of the 70-year-old banker. Mr. Sáenz will be replaced as CEO by Javier Marín, until now managing director of the bank.

Santander’s shares rose Monday following news of Mr. Sáenz’s resignation.

The decision followed discussions between Mr. Sáenz and officials at the central bank, according to people familiar with the talks. At least one person said the central bank had indicated to Mr. Sáenz that it was likely to conclude that he didn’t belong in a senior role at the bank, suggesting that the central bank had a sterner view of Mr. Sáenz’s case than the government of Prime Minister Mariano Rajoy….”

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“…..”Our global economy, reckless in its use of all resources and natural systems, shows many of the indicators of potential failure that brought down so many civilizations before ours,” writes Grantham in his new quarterly letter titled “The Race Of Our Lives.”

In 10 pages, he compiles some key points we’ve heard him discuss at length in his recent media tour.  He spends most of his message on what makes him optimistic.  We summarize is letter here.

Civilizations Fall

Even the greatest civilizations like Rome eventually fell.  Citing research, Grantham told Charlie Rose that civilizations have an average lifespan of around 250.

He hammers on this topic at length in his letter.

“Probably the greatest agreement among scholars, though, is that the failing civilizations suffered from growing hubris and overconfidence: the belief that their capabilities after many earlier tests would always rise to the occasion and that growing signs of weakness could be ignored as pessimistic,” he writes.

Fortunately, we might not be doomed.  Grantham sees two things that might save us.

Declining Fertility

Economist Thomas Malthus warned us that the growing population would eventually outpace the earth’s ability to feed it.

“Malthus, however, completely missed declining fertility, a potentially very long-term and hence much more critical factor to the survival of our species,” writes Grantham. “Neither he nor anyone else before 1960 even dreamed that we would voluntarily decide to have fewer children even as we became richer. In his day and until the early twentieth century, rich families routinely had eight or more children.”

In nearly every major economy, fertility rates have been falling.  He includes five charts showing this, including one that stood out.

GMO

Here’s Grantham…”

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“….In his weekly ‘Sunday Start’ letter, Morgan Stanley‘s Joachim Fels presents the other side of the commodity collapse, and a reason to be optimistic:

Somehow the proverbial American optimism must have affected me also when it comes to the cyclical outlook. What I’ve been telling investors on my trip is that despite the soft patch in the US economic data, the wobbly recovery in China and what looks like a deepening recession in the euro area following this past week’s PMI, Ifo and INSEE business surveys, my confidence in our ‘twilight to daylight’ saga of a second-half global rebound is actually even stronger now. Why? One reason is the much-discussed drop in commodity prices. My sense is that this is not just a reflection of recently weaker global growth data. I rather suspect it is also due to the supply response in many commodity markets that has been elicited by years and years of elevated prices, and to a growing realization by investors that global money-printing does not necessarily lead to high inflation, which has probably reduced the demand for commodities such as gold and oil as inflation hedges. In any case, lower commodity prices lead to what I call ‘good disinflation’ as consumers’ real disposable incomes benefit from lower energy and food prices. Hence, I expect the global soft patch to give way to a consumer-led re-acceleration in the next couple of months.

The second half of the explanation, that there’s been a sea-change in thinking among investors about the relationship between “money printing” and high inflation is an important one….”

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SOURCE
NYSE

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Upgrades  – ANF, FLIR, LPNT, MSG, PBR, PVH, STI, THC, DIS

Downgrades  – BBEP, ECL, GCI, GFI, JBLU, LEAP, NGL, RSG, NGLS, UNP

In Play ,

On the Wires 

“(Reuters) – Sina Corp, China’s largest Internet portal and media website, said e-commerce company Alibaba Group has bought an 18 percent stake in its microblogging service Weibo for about $586 million, valuing Weibo at more than $3 billion.

The company has also granted Alibaba the option to increase its stake in Weibo to 30 percent within a stipulated time, which it did not specify.

Sina’s U.S.-listed shares jumped 17 percent to $58.85 in premarket trade on Monday…..”

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“$FB has lost millions of users per month in its biggest markets, independent data suggests, as alternative social networks attract the attention of those looking for fresh online playgrounds.

As Facebook prepares to update investors on its performance in the first three months of the year, with analysts forecasting revenues up 36% on last year, studies suggest that its expansion in the US, UK and other major European countries has peaked.

In the last month, the world’s largest social network has lost 6m US visitors, a 4% fall, according to analysis firm SocialBakers. In the UK, 1.4m fewer users checked in last month, a fall of 4.5%. The declines are sustained. In the last six months, Facebook has lost nearly 9m monthly visitors in the US and 2m in the UK.

Users are also switching off in Canada, Spain, France, Germany and Japan, where Facebook has some of its biggest followings. A spokeswoman for Facebook declined to comment.

“The problem is that, in the US and UK, most people who want to sign up for Facebook have already done it,” said new media specialist Ian Maude at Enders Analysis. “There is a boredom factor where people like to try something new. Is Facebook going to go the way of Myspace? The risk is relatively small, but that is not to say it isn’t there.”

Alternative social networks such as Instagram, the photo sharing site that won 30m users in 18 months before Facebook acquired the business a year ago, have seen surges in popularity with younger age groups.

Path, the mobile phone-based social network founded by former Facebook employee Dave Morin, which restricts its users to 150 friends, is gaining 1m users a week and has recently topped 9m, with 500,000 Venezuelans downloading the app in a single weekend.

Facebook is still growing fast in South America: monthly visitors in Brazil were up 6% in the last month to 70m , according to SocialBakers, whose information is used by Facebook advertisers, while India has seen a 4% rise to 64m – still a fraction of the country’s population, leaving room for further growth.

But in developed markets….”

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