Sunday, May 26th, 2013

iBC Newsbot 3000

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Digitimes.com

Nvidia introduces GeForce GTX 780 GPU for gaming (2 days ago)
', this, event, '150px')">Quartz component maker TXC expects sales to rise through 4Q13 (2 days ago)
UDE likely to obtain orders from 2 game console vendors (2 days ago)
Lenovo 1Q13 net profit hikes 90% on year (2 days ago)
Phison warns several backend firms of possible patent infringement (2 days ago)
Facebook sets up OCP Taiwan (2 days ago)
', this, event, '150px')">Computex 2013: Memory module firms to showcase new SSDs (2 days ago)
Asia to be largest LTE market, says Nokia Siemens Networks greater China head (2 days ago)
ABB to produce PV inverters in South Africa (2 days ago)
Global LCD monitor OEM shipments down 14% on year in 1Q13, says TPV (2 days ago)


The Financial Times

European lenders unloved amid growth fears (1 day ago)
Trader?s Diary: Markets at a crossroads (1 day ago)
P&G stands out in weaker US market (1 day ago)
Global stock markets ? fragile confidence (1 day ago)
Investors weigh life left in bull run (2 days ago)
Psst! Don?t tell Sid about Lloyds Bank (2 days ago)
Origin of Japan rout lies in Washington (2 days ago)
Nikkei recovers some poise (2 days ago)
Commerzbank and UniCredit slide (2 days ago)
Market bulls run into the sand (2 days ago)


InformationWeek

', this, event, '150px')">7 Slick Siri Alternative Apps (12 hours ago)
', this, event, '150px')">Google Researcher Reveals Zero-Day Windows Bug (1 day ago)
', this, event, '150px')">iOS 7 Undergoing Ive-Led Transformation (1 day ago)
', this, event, '150px')">Facebook Kills HTC 'First' European Debut (1 day ago)
', this, event, '150px')">SAP Loses 'Cloud DNA' As Lars Dalgaard Steps Down (1 day ago)
', this, event, '150px')">White House Announces Mobile Security Guidelines (2 days ago)
', this, event, '150px')">Joyent Matches Amazon Cloud Infrastructure Prices (2 days ago)
', this, event, '150px')">Microsoft To Windows 8 Haters: Try This Mouse (2 days ago)
', this, event, '150px')">5 Ways To Get Big Data Plans Moving (2 days ago)
', this, event, '150px')">Google Cuts Prices On New Datastore Service (2 days ago)


Light Reading

WDM Market Grows 10 Percent (23 hours ago)
MEF Launches CloudEthernet (24 hours ago)
Cogeco Expands HD VoD Coverage (24 hours ago)
Arris Counts on CPE Upgrades (1 day ago)
WOW Loses Subs Across the Board (1 day ago)
Heavyweights Form CloudEthernet Forum (1 day ago)
Euronews: French Carriers Feel the Squeeze (2 days ago)
Cisco Lands Chinese Cable Deal (2 days ago)
Softbank Gets State Approval for Sprint Buy (2 days ago)
ConteXtream Claims Tier 1 Win (2 days ago)


TheOilDrum.com

New Computer Attacks Traced to Iran, Officials Say SAN FRANCISCO ? American officials and corporate security experts examining a new wave of potentially destructive computer attacks striking American corporations, especially energy firms, say they have tracked the attacks back to Iran.

The targets have included several American oil, gas and electricity companies, which government officials have refused to identify. The goal is not espionage, they say, but sabotage. Government officials describe the attacks as probes looking for ways to seize control of critical processing systems.

Crude Caps Weekly Drop as Investors Weigh Stimulus West Texas Intermediate crude fell, capping its biggest weekly drop in more than a month, after rising U.S. durable goods orders bolstered concern that the Federal Reserve will scale back stimulus efforts.

Gasoline Slips on Speculation Demand to Fall After Memorial Day Gasoline fell as equities declined and on speculation that demand will drop after the U.S. Memorial Day Holiday.

Futures headed for the biggest weekly decline since April 5 as the summer driving season began today with the start of the four-day holiday weekend. Demand rose 5.4 percent last week, and averaged over four weeks is down 3.3 percent from the year before, according to Energy Information Administration data. The S&P 500 slid 0.6 percent to 1,640.58 at 9:57 a.m. in New York.

Primorsk June Urals Crude Shipments Lowest Since at Least 2008 Russia, the world?s largest energy exporter, plans to ship less than one million barrels a day of Urals crude from Primorsk port on the Baltic Sea for the first time since at least 2008, a preliminary loading program showed.

Bolivia to boost incentives for gas exploration Santa Cruz (Bolivia) (IANS) Bolivia\'s government, which asserted greater state control over the Andean nation\'s natural gas sector seven years ago, says it will issue a decree to encourage investment in exploration.

\'State-run oil companies to gain more from new gas price\' NEW DELHI: Oil minister M Veerappa Moily on Friday said any revised price set for domestic natural gas would also apply to state-owned companies such as Oil and Natural Gas Corporation and Oil India , even as he joined issue with Left MP Gurudas Dasgupta to refute allegations of favouring Reliance Industries.

NY trial may clean Mexico?s oil mess A trial in Manhattan federal court may help push Mexico to free its decaying oil industry from the state-owned monopoly known as Pemex, for Petroleos Mexicanos. And that?s good news for both sides of the border, indeed for the whole world.

Greece modifies DEPA privatisation terms to accommodate Gazprom: source ATHENS (Reuters) - Greece agreed to change some terms in the planned privatisation of natural gas distributor DEPA, opening the way for Russian energy giant Gazprom to bid for the firm, a senior official directly involved in the sale talks said on Saturday.

Russia to cancel Gazprom?s liquefied gas export monopoly Liberalizing liquefied natural gas (LNG) exports will take place on a legislative level once Novatek and Rosneft reach preliminary agreements with their international partners, according to Arkady Dvorkovich, the Deputy Prime Minister in charge of fuel and energy. He predicted the changes would take place this year.

Iran Sees Self-Reliance as Top Priority for Oil Industry TEHRAN (FNA)- Deputy Iranian Oil Minister for Research and Technology Mohammad Reza Moqaddam said self-reliance and indigenization are among the Oil Ministry\'s top priorities.

Addressing the inaugural ceremony of the Membrane Technology Center Moqaddam said, \"Today is an important day in the history of Iran\'s petrochemical industry.\"

Ineffectiveness of Sanctions Proved by Oil Industry TEHRAN (FNA)- Iran\'s oil industry has proved ineffectiveness of the sanctions, Oil Minister Rostam Qassemi said.

Speaking at the inaugural ceremony of a membrane technology center, four catalysts and three technical knowhow at Petrochemical Research and Technology Company, Qassemi said, \"Relying on their knowledge, Iranian researchers have been able to thwart sanctions imposed against the country and take great strides towards self sufficiency and indigenization oil industry equipments.\"

Gloomy predictions overlook change A new assessment of the world?s oil reserves predicts a surge of supply from North America, mostly from new, unconventional sources. This will transform the global supply of oil and help ease tight markets.

By 2018, the International Energy Agency projects, global oil production capacity will grow by 8.4 million barrels a day ? a significantly faster pace than demand. The headline reads: ?Peak Oil Is Dead.? Peak Oil is a theory that at some point global oil production will peak, then steadily decline as oil reserves are depleted.

Almost everyone will be glad to know that this theory is dead.

Is peak oil never going to happen? You can make a coherent, logical argument for cars that don\'t burn gasoline without once mentioning global petroleum supply. You can talk about international relations and the power of gasoline exporters (just read the first three paragraphs of this for a bit of history). You can talk about climate change. You can talk about the health effects of CO2 in the air. But the fact remains that gasoline (or diesel) remains the go-to fuel for almost every passenger vehicle on the planet, so the question of how much black gold is out there is an important one. The answer, though is not so clear.

Using up our finite resources will make us dependent on foreign oil Regardless of the varying beliefs about climate change and whether mankind is impacting the climate, surely we all recognize that there is a finite supply of fossil fuels. At the same time, we can all agree the worldwide demand for fossil fuels will continue to grow along with population growth and with increased industrialization of countries in Asia and Latin America.

As demand for fuel grows, new sources are routinely being discovered and developed, but we know that there are limits to what is ?out there.? We also recognize that many of the new fuel sources require greater resources for their development, and the capture of these fuels can have significant impacts on the environment.

Big Coal Faces Big Opposition In Pacific Northwest Earlier this month, grassroots climate and anti-extraction activists in the Pacific Northwest scored a victory over one of the world?s most powerful industries. Kinder Morgan, an energy company that operates 26,000 miles of pipelines and owns 170 largely energy-related export terminals, announced it is scrapping plans to build a large coal export terminal on the Columbia River. The company has downplayed the role of community opposition to its terminal, claiming logistical considerations led to abandonment of the project. But local activists see more to the story than that.

Illinois proposes fracking tax that is lower than in other states In Illinois, oil producers will enjoy their lowest tax rates when oil is flowing at its peak and tax rates would be about half that of some states with fracking operations.

The state would receive estimated $725,508 in taxes on each fracking well, assuming a life span of 10 years and a price of $85 per barrel of oil. A separate tax that would go to the local taxing districts in which the well is located would generate about $555,481, according to an analysis for the Tribune by Mark Haggerty of Headwaters Economics in Montana.

British Villagers, Fearing Fracking, Protest Plan for Drilling BALCOMBE, England ? Despite the stakes, there was almost a festival spirit in this wealthy little village nestled in the hills of West Sussex. Children buzzed around an open-sided tent by the street and families spread blankets on the tiny village green.

What brought them together on Thursday evening, though, was not a spring fair but deep worry. Cuadrilla Resources, a British energy company, is on the verge of drilling an exploratory oil well just down the road. Villagers see it as a possible precursor to the environmentally controversial drilling technique known as hydraulic fracturing, or fracking.

Is Nuclear Energy\'s Lightbulb Dimming? Not only is dropping nuclear power a complicated issue, but it also challenges very recent data that show just how painful that endeavor could be. Advocates of a nuclear-free future should consider what would happen to the electricity bills of consumers in such a scenario. Meanwhile, the data may support the idea that exposing your portfolio to nuclear fuel won\'t be as radioactive to your portfolio as once thought.

Green phoenix rises from the ashes as Japan shifts its focus The word \"Fukushima\" may be synonymous with nuclear meltdowns, ghost towns and contaminated rice fields.

The north-east region of Japan, however, once famed for its green mountains and fresh vegetables, is in the midst of the most ambitious of rebranding projects: it is attempting to transform itself into a global green energy hub.

Europe must get its head down One professional judgement on Europe\'s advances in providing power from renewable energy sources reads a little like a promising but inconsistent pupil\'s school report card: \"Makes steady progress but could do better.\"

The detail of the assessment may become clear when delegates meet in Vienna for a three-day European conference, hosted by the Renewable Energy World and Power-Gen and starting on June 4.

Ernest Moniz, Natural Gas And The ?Forgotten Renewables? In a town hall meeting with staffers last week, new Energy Secretary Ernest Moniz dropped a bombshell and a hint. The bombshell, at least as far as fans of natural gas are concerned, is that Moniz sees natural gas not as a permanent fixture in the U.S. energy landscape but merely as a temporary ?bridge? to a globally competitive, low carbon future that is well within our grasp.

Better Place to file for bankruptcy FORTUNE -- Electric car company Better Place is planning to file for bankruptcy within the next several days, Fortune has learned.

The move will come seven months after the ouster of charismatic founder Shai Agassi, and five months after his successor -- Evan Thornley, CEO of Better Place Australia -- also departed.

Car sharing with strangers a growing business in US Los Angeles (IANS/EFE) The sight of a hitchhiker on the curb trying to hail some charitable driver could be a thing of the past as the practice of car sharing grows.

As a result of the recent economic crisis, the US has seen a wide range of companies ready to convert any and every car into a rental vehicle and provide its proprietor with extra income, while offering clients much lower prices than what a taxi or a rent-a-car like Avis or Hertz would charge.

Clemson police officer charged with theft of gasoline from motor pool A Clemson University police officer is out of a job and faces multiple criminal charges.

The State Law Enforcement Division arrested Sgt. Jason D. Cassell, 39, of Pickens on Thursday on a charge of stealing gasoline from the university motor pool, according to a press statement from the university?s media relations office.

Bearing down: How safe is that bridge you\'re driving over? To make all necessary repairs to America\'s bridges, the Federal Highway Administration estimates it will cost $76 billion.

Who\'s going to pay for that? Taxpayers? No thank you, say most of the Americans who answered a recent Gallup poll.

Two thirds said they\'re against paying more in gasoline taxes to fund bridge and road repairs in their own states. And it didn\'t matter if the respondents were Republican, Democrat or independent.

These 6 States Have the Most Dangerous Bridges With help from the ASCE\'s report, let\'s look at the six states that have the greatest number of bridges that qualify as structurally deficient and therefore require substantial maintenance, rehabilitation, or replacement, with regular inspections to ensure continuing viability. We\'ll also look at some of the financial resources those states have to help pay for necessary work.

Floods could overwhelm London as sea levels rise - unless Thames Barrier is upgraded There is significant risk of London being hit by a devastating storm surge in the Thames estuary by 2100 that could breach existing flood defences and cause immense damage to the capital, a study of global sea-level rise has found.

Melting of polar ice sheets and mountain glaciers could increase sea levels significantly over the coming decades leading to a 1 in 20 risk that the existing Thames Barrier would be unable to cope with an extreme storm surge, the study concluded. ', this, event, '150px')">Drumbeat: May 25, 2013 (10 hours ago)
Crude Landlocked as Canadians Join U.S. to Halt Pipelines British Columbia, the Canadian province whose official slogan to its own beauty is ?Super, Natural,? is invoking another saying: ?No more supertankers.?

That?s potentially big trouble in a nation where oil exports amount to $73 billion annually and the industry employs more than 550,000 workers. It?s also a bad omen for nations, notably China, that have invested billions in Canadian oil projects with expectations that they will one day be able to buy vast quantities of heavy Canadian crude.

House Passes Keystone Bill as White House Vows Veto The U.S. House of Representatives passed legislation to approve the Keystone XL oil pipeline, the eighth time congressional Republicans have advanced a measure promoting the project.

Democrats called yesterday?s vote in the Republican-controlled chamber a largely symbolic effort to score political points because the bill was unlikely to become law. The Senate, where Democrats have the majority, isn?t considering similar legislation, and President Barack Obama?s administration has threatened a veto should the bill emerge from Congress.

Texas Farmers Lose Another Bid to Block Keystone Pipeline TransCanada Corp. won another of the remaining Texas state-court challenges by landowners trying to block construction of the Keystone XL tar-sands pipeline across their property.

Cheap shale gas bubble \'will burst within 2-4 years\': Expert The current shale gas boom which has bathed the US economy in cheap energy will soon go bust, a former gas industry geologist has told EurActiv.

The future of shale gas in Europe was high on the agenda at an EU summit in Brussels yesterday (22 May), with leaders stressing the ?crucial? role that such indigenous energy resources could play in reviving industry.

But according to David Hughes, a geoscientist and former team leader on unconventional gas for the Canadian Potential Gas Committee, the US boom on which many base their expectations is founded on shifting sands.

WTI Heads for Biggest Weekly Decline in a Month on Supply West Texas Intermediate headed for its biggest weekly drop in more than a month amid signs of rising U.S. oil inventories and a global economic slowdown.

Futures slid as much as 0.8 percent in New York. Prices may decline next week amid speculation that U.S. fuel supplies will be sufficient to meet summer demand after factory output in China shrank for the first time in seven months, according to a Bloomberg News survey. Goldman Sachs Group Inc. recommended selling WTI and buying Brent contracts for December 2014 as supplies accumulate on the U.S. Gulf Coast.

Oil Options Volatility Rises as Futures Decline Third Day Crude oil options volatility rose as the underlying futures fell for a third straight session.

Implied volatility for at-the-money options expiring in July, a measure of expected price swings in futures and a gauge of options prices, was 22.5 percent at 1:35 p.m. on the New York Mercantile Exchange, up from 22.06 percent yesterday.

Gulf Crudes Strengthen as Volume Declines During Rollover Period Gulf Coast crude oils strengthened on the spot market during the three-day rollover period characterized by below-normal volume and erratic pricing.

Russia to steeply cut Baltic oil loadings LONDON: Russia will steeply cut Urals crude oil exports from Baltic ports in June and load a total of 58 cargoes compared to 70 cargoes in May, trading sources said on Friday citing a loading schedule.

OPEC to Keep Exports Stable Amid Supply Glut, Oil Movements Says The Organization of Petroleum Exporting Countries will keep crude shipments little changed into early next month as abundant inventories cap demand, tanker tracker Oil Movements said.

Gasoil Ship Rates Rising in Northwest Europe as BP Takes Tankers Rates to ship gasoil in northwest Europe are rising after BP Plc booked tankers to take refined fuel from the region to Algeria, draining vessel supply.

U.S. April Gasoline Use Fell From Year Earlier, API Says U.S. gasoline consumption in April dropped to the lowest level for the month in 13 years, the American Petroleum Institute said.

Primorsk June Urals Crude Shipments Lowest Since at Least 2008 Russia, the world?s largest energy exporter, plans to ship less than one million barrels a day of Urals crude from Primorsk port on the Baltic Sea for the first time since at least 2008, a preliminary loading program showed.

India: Power Failures Set Off Protests A blistering heat wave has swept across most parts of north and western India, causing widespread electricity cuts and leading residents to protest and even attack power company officials and property.

UK gas supply six hours from running out in March Britain came within six hours of running out of natural gas in March, according to a senior energy official, highlighting the risk of supply shortages amid declining domestic production and a growing reliance on imports.

?We really only had six hours? worth of gas left in storage as a buffer,? said Rob Hastings, director of energy and infrastructure at the Crown Estate, the property portfolio managed on behalf of the Queen. ?If it had run any lower it would have meant?.?.?.?interruptions to supply.?

How to Invest in Peak Oil In the following video, Motley Fool energy analysts Joel South and Taylor Muckerman discuss a theory that has been around for 40 years -- the idea of peak oil. Joel tells investors that this won\'t mean that we run out of oil completely; rather, it means the end of oil that is cheap to produce, as resources that are easily accessed begin to dwindle. He then gives investors a few possible long-term plays to make to capitalize on this trend.

Australia Lures $21 Billion Bet on Coal Rebound Coal?s worst slump in seven years has failed to deter GVK Group and Adani Enterprises Ltd. from pressing ahead with a $21 billion bet on Australia?s Galilee Basin as other companies shelve projects amid rising costs.

Sinopec\'s Addax seeks more North Sea investments GENEVA (Reuters) - Sinopec subsidiary Addax Petroleum wants to buy more North Sea assets this year, its Chief Executive said, in a sign that Chinese firms may further boost their regional investments after two multi-billion deals in 2012.

Addax, a Swiss-based oil producer and explorer which was bought by China\'s top refiner in 2009 for more than $7 billion, first entered the North Sea last July with the purchase of a 49 percent stake in Canada\'s Talisman.

Oil Revolt Generates $35 Billion as Icahn-Singer Agitate Apache Corp. isn?t waiting for Carl Icahn to tell the energy company how to reverse a two-year decline that?s erased $14 billion from its market value.

BP, Chevron, Total and other major oil firms seek new terms in Iraq International oil companies in Iraq are negotiating to revise their contracts with the government, as new production targets undermine the profitability of their operations.

Iraq\'s government earlier this year revised down its national oil output targets to 9.5 million barrels per day (bpd) by 2020, up from about 3 million bpd today, as part of a new blueprint for the development of its energy sector.

U.S. officials lauds India for reducing Iranian oil imports PanARMENIAN.Net - A senior American official on Friday, May 24, praised India for reducing oil imports from Iran and said the U.S. government will decide soon on New Delhi?s request to renew a waiver from sanctions on Tehran, The Associated Press reports.

Gazprom announces ?fundamentaly new? LNG project Russian gas major Gazprom will soon announce another \"fundamentally new\" liquefied natural gas project, according to company CEO Aleksey Miller. Sources say it?s likely to be an LNG plant in the Baltic.

Zurich Insurance Seeks China, Saudi Expansion on Growth Bets Zurich Insurance Group AG plans to expand in China and Saudi Arabia as the insurer seeks to capitalize on economic growth in the world?s second-biggest economy and largest oil exporter.

Texas Cited by Democrat as Model for Less Flaring After Fracking Texas should be the model for other states as officials seek to reduce the need to burn, or flare off, methane coming from oil and gas wells drilled by hydraulic fracturing, a top Senate Democrat said.

Senator Ron Wyden, chairman of the Energy and Natural Resources Committee, praised Texas for a flaring rate of 0.5 percent of the gas it produces.

Academics back BP\'s fight to cap oil spill payouts LONDON (Reuters) - A group of accountancy professors is backing BP\'s fight to cap the U.S. oil spill compensation payouts it has to fund as the cash outflow threatens to add billions of dollars to its bill for the disaster.

Shipwreck Oil Spill Time Bombs Identified Out of approximately 20,000 shipwrecks in U.S. waters, the National Oceanic and Atmospheric Administration recently identified 36 sunken vessels that most threaten to disgorge their oily innards. NOAA recommended further assessment and potential oil clean-up of seventeen of those shipwrecks. The list was further narrowed to six ships that were most probable to leak 10 percent of their fuel oil or oil cargo. These high risk ships were all off the coasts of New England or Florida.

IEA: protect consumers from energy price hikes The International Energy Agency said Friday that Germany must shield its consumers from paying too much of the cost of its ambitious switch from nuclear power and fossil fuels toward renewable energy.

Solar plane completes second leg of cross-country flight in Texas (Reuters) - A solar airplane that developers hope to eventually pilot around the globe landed safely on Thursday in Texas, completing the second and longest leg of an attempt to fly across the United States powered only by the sun.

The E-Cat is back, and people are still falling for it! I?m done pretending that this is science, or that the ?data? presented here is scientifically valid. If this were an undergraduate science experiment, I?d give the kids an F, and have them see me. There?s no valid information contained here, just the assumption of success, the reliance on supplied data, and ballpark estimates that appear to be supplied ?from the manufacturer.?

This is not a valid way to do science at all. And this is certainly not even close to meeting the criteria required for extraordinary evidence to back up such an extraordinary claim.

The long road to the 2000-watt society The vision of a society in which each inhabitant of the earth manages to consume only 2000 watts has already been around for 15 years. During this time, there has been a steady increase in environmental awareness in the West. Technology has become more efficient and there appears to be very little standing in the way of a sustainable lifestyle. However, as a study by Empa and the Federal Institute of Technology (ETH) Zurich now shows, Mr and Mrs Swiss are still a long way from achieving this.

2013 hurricane names: From Andrea to Wendy Weather forecasters are predicting another busy Atlantic hurricane season. The storms will get their names from an alphabetical list of 21 names:

Andrea, Barry, Chantal, Dorian, Erin, Fernand, Gabrielle, Humberto, Ingrid, Jerry, Karen, Lorenzo, Melissa, Nestor, Olga, Pablo, Rebekah, Sebastien, Tanya, Van and Wendy.

Noaa predicts wildly active hurricane season out of Atlantic and Caribbean Americans were warned on Thursday to brace for an extremely active hurricane season ? less than a year after the devastation of Sandy, which hit the east coast in October 2012 ? with 13 to 20 named storms, including seven to 11 hurricanes.

The National Oceanic and Atmospheric Administration, releasing its annual forecast, said 2013 would be prolific in raising storms out of the Atlantic and Caribbean. Of the predicted hurricanes, Noaa predicted that three to six could be major hurricanes, rated category three and packing winds of 111mph or higher.

Can We Protect Against the Next Moore Tornado? Sad experience is teaching that some old tornado safety tricks aren\'t as effective as hoped ? particularly when buildings aren\'t designed with tornado safety in mind. In Joplin, Miss., a 2011 tornado killed 158, according to the National Weather Service (the city of Joplin pegs the death toll at 161). Among the devastated buildings was a local high school, and some of the spots disaster experts would normally suggest people go for shelter turned out to be among the most badly damaged there.

Interior hallways are usually the suggested shelter spots, but in Joplin, doors and glass windows at either end of long halls were destroyed by debris, creating a dangerous situation, Gallus said.

\"Hallways became wind tunnels,\" he said. Architects like natural light, he said, but \"probably when we design schools in the future, we need to be careful how we design them.\"

US carbon price backed by independent office A tax on carbon dioxide emissions could help the United States mitigate climate change while significantly increasing government revenue, the nonpartisan Congressional Budget Office said this week.

President Barack Obama supports plans to price carbon dioxide emissions from power plants, tailpipes and factories that have been blamed for worsening climate change.

A mission on climate change President Obama should spend his remaining years in office making the United States part of the solution to climate change, not part of the problem. If Congress sticks to its policy of obstruction and willful ignorance, Obama should use his executive powers to the fullest extent. We are out of time.

Colorado\'s state climatologist says the High Park Fire granted him the permission, courage to talk about climate change. Nolan Doesken used to have a hard time talking about climate change.

The topic has become so politically combustible that some scientists and researchers find it difficult to speak of or write about.

But, after the High Park Fire swept the foothills in 2012, Doesken decided to talk more openly about the reasons behind Colorado?s changing weather when talking to the agriculture community.

Russia evacuates drifting Arctic research station Russia has ordered the urgent evacuation of the 16-strong crew of a drifting Arctic research station after ice floe that hosts the floating laboratory began to disintegrate, officials said Thursday.

Natural Resources and Ecology Minister Sergei Donskoi set a three-day deadline to draft a plan to evacuate the North Pole-40 floating research station, the ministry said in a statement.

Why Happy People Hide From Climate Change New research found that when people have positive feelings toward climate change, such as hopefulness or excitement, they are more likely to avoid seeking information about it. Those who felt concerned, anxious or depressed about the topic, on the other hand, were more likely to seek information about it, new research shows.

What Does 400 PPM Mean for American Labor? n 1940, as Nazi armies marched across Europe, United Automobile Workers Union (UAW) president Walter Reuther made a stunning proposal: Retool the Depression-ravaged auto industry to build 500 planes a year for national defense. Many scoffed. But a huge wartime mobilization put tens of millions of unemployed and underemployed workers to work producing what the war effort required, while shutting down wasteful and unnecessary production that would detract from it.

Screwed by climate change: 10 cities that will be hardest hit Here at Grist, climate change is our bread and melting butter. But this month, we?re feeling especially hot and bothered. As part of our in-depth look at the warming planet, we?ve compiled a list of the U.S. cities that we think will be in the hottest water as the mercury rises ? in some cases, up to their foreheads.

Spared by climate change: The 10 best cities to ride out hot times Yesterday, we brought you our remarkably unscientific (seriously, it was written by this guy) list of the 10 cities most likely to get hammered by climate change. Today, we thought we?d give you the bright side, such as it is: the 10 towns to which we?ll all be flocking as the rest of the world goes to hell. You?re welcome. (Hey, we don?t call Grist ?a beacon in the smog? for nothing.)

Saving Delaware\'s coast from sea-level rise In a symbolic blow to state climate change adaption efforts, the Delaware county with most at stake in future sea-level rise forecasts abruptly declined to take any stand on the issue Thursday as a state panel approved dozens of recommendations for dealing with the threat. ', this, event, '150px')">Drumbeat: May 24, 2013 (1 day ago)
Oil-Fixing Probe Accelerates as EU Asks Traders for Help The investigation into possible oil-price fixing gathered pace as trading houses from Glencore Xstrata Plc, the $70 billion mining firm, to Gunvor Group Ltd. were asked to provide information to European regulators.

Glencore Xstrata, Gunvor and Vitol Group, which aren?t under investigation, along with other firms with offices in Switzerland, are assisting the European Commission with the inquiry, said three people familiar with the situation, who asked not to be identified because the matter is private. The commission announced last week that it?s probing whether oil companies colluded to distort prices.

Indonesia re-arrests Chevron exec amid tension with Big Oil (Reuters) - Authorities have bypassed a court order and re-arrested an executive at Chevron Corp\'s Indonesian unit in a graft case that highlights growing tension with big oil companies in a country struggling to reverse a decline in oil production.

The attorney general\'s office said on Wednesday it had re-arrested Bachtiar Abdul, an executive at PT Chevron Pacific Indonesia, despite a Nov. 27 court order that cleared him of any wrongdoing and released him from detention.

China?s SUV Fleet to Drive Oil Demand Growth, Bernstein Says China?s growing fleet of sport utility vehicles will offset gains in fuel efficiency and continue to drive oil-demand growth, according to Sanford C. Bernstein Research.

Chinese oil consumption will increase at an average annual pace of 5 percent to reach 12.9 million barrels a day in 2018, from 9.6 million barrels a day in 2012, the investment research company said in a report e-mailed today. Its forecast is higher than the International Energy Agency?s outlook for a 4 percent average annual increase for the same period.

China Net Gasoline Exports Stay Remain Year High as Demand Slows China?s net exports of gasoline remained near the highest level in a year amid the nation?s weakest domestic oil demand in eight months.

Overseas sales of gasoline exceeded imports by 468,553 metric tons in April, according to data e-mailed by the General Administration of Customs in Beijing today. That?s equivalent to 132,360 barrels a day. In March, net gasoline exports were 506,110 tons, the most in a year.

WTI Crude Drops a Second Day as U.S. Supplies Gain a Fourth Week West Texas Intermediate fell for a second day after industry data showed U.S. inventories rose for a fourth week, the longest run of gains since February. China?s oil stockpiles climbed for a second month.

Futures slid as much as 0.9 percent in New York after a report from the American Petroleum Institute showed crude stockpiles increased 532,000 barrels last week. Government figures today are projected to show a 1 million-barrel decline, according to a Bloomberg News survey of analysts. The API also indicated gains in gasoline and distillate-fuel supplies, including heating oil and diesel.

Crude and Product Stockpiles Gained Last Week, API Says Oil supplies advanced 532,000 barrels to 390.7 million, the American Petroleum Institute said.

Distillate fuel inventories rose 459,000 barrels to 118.4 million, the API?s weekly report showed. Gasoline stockpiles also increased, gaining 3.03 million to 219.5 million.

Gasoline Falls on Speculation Tornado Didn?t Affect Inventories Gasoline fell on speculation that the deadly tornado near Oklahoma City may not have affected refinery operations in the area.

Northwest Gasoline Tumbles on Tankers, as Shell Restores Output Spot gasoline in the U.S. Pacific Northwest dropped by the most against futures since February as tankers carried oil products to the region and a Royal Dutch Shell Plc (RDSA) refinery recovered from a power failure.

Coal?s Record Slump Poised to End on Output Cuts European coal?s longest slump in at least eight years is poised to end as imports from the U.S. fall and further declines trigger production cuts at mines in Russia and Poland.

When oil forecasts get it wrong The famous Danish physicist Niels Bohr once humorously observed, \"Predictions are very difficult, especially about the future.\" And so, as the world considers yet another rosy oil supply forecast, this time from the Paris-based International Energy Agency (IEA), it is worth reviewing the agency\'s record.

The Coming Deluge of Oil It came without warning: A flood of oil. Just a few years ago we were talking about peak oil, the slow, painful demise of crude. Now there\'s talk about a shock wave of new oil supply from North America that\'s about to slam into global markets.

We\'re in the early stages of a new oil boom here in North America. The tar sands of Canada started the rumble. Now it\'s set to be the shale oil from North Dakota, South Dakota and Montana that will make the U.S., in five years or less, the largest oil producer in world, even greater than Saudi Arabia. By 2018, according to the International Energy Agency (IEA), there\'ll be more oil produced than cars can burn.

Is peak oil never going to happen? You can make a coherent, logical argument for cars that don\'t burn gasoline without once mentioning global petroleum supply. You can talk about international relations and the power of gasoline exporters (just read the first three paragraphs of this for a bit of history). You can talk about climate change. You can talk about the health effects of CO2 in the air. But the fact remains that gasoline (or diesel) remains the go-to fuel for almost every passenger vehicle on the planet, so the question of how much black gold is out there is an important one. The answer, though is not so clear.

Has the EIA Killed Peak Oil? A number of factors have changed the face of peak oil. Low U.S. growth, increased oil production and more fuel efficient modes of transportation have dampened the effects of rising energy costs. Peak oil is still a real phenomenon, but in the medium term it looks like it will affect the economy through subtle means.

Peak oil conjures up images of mile-long lines at gas stations and whole nations experiencing Cuban-like economic collapse. Recent data suggests that in America, peak oil may be mainly manifest through strong inflation that decreases the average worker\'s real income.

Ben Bernanke sees the great slowdown in technological progress The great slowdown is a historical fact, an important event still occurring. We can see a few of its effects, such as how it contributes to the multi-decade stagnation of real wages for most American households.

How long will it last? Almost everybody sees this as the slowdown as a pause, not an end to progress. The subtitle to Tyler Cowen?s The Great Stagnation is ?How America (Eventually) Will Feel Better Again.?

Soaring energy costs make Europeans poor Over the past few years Europeans have seen their energy costs locked into an upward spiral, deteriorating the competitiveness of European businesses and putting more households at risk of energy poverty.

Across Europe, average electricity prices for households and industries have increased by 29% between 2005 and 2011. Over the same period of time electricity prices in the USA increased by only 5% and in Japan by 1%.

Ipic seeks $4bn return for building key oil pipeline The International Petroleum Investment Company (Ipic) is in talks with the Government to receive US$4 billion in cash for building a strategic oil pipeline bypassing the Strait of Hormuz.

Ipic executives said in an investor call this week that the investment company expected to be reimbursed for the cost of building the pipeline in several payments over the coming year, Reuters reported.

Turkey eyes oil, gas deals with Iraqi Kurdistan (Reuters) - Turkey is looking to sign commercial contracts this year with Russian and U.S. companies operating in northern Iraq for joint oil and gas exploration, Turkey\'s Energy Minister Taner Yildiz told Reuters.

Turkish Prime Minister Tayyip Erdogan last week discussed U.S. concerns about Turkey\'s deepening energy ties with Iraqi Kurdistan during meetings in Washington with President Barack Obama.

Myanmar to pump oil and gas to energy-hungry China An hour\'s drive outside the Yunnan provincial capital Kunming, at a vast construction site, building work is nearing completion on a Dh7.35 billion pipeline that will ship oil and gas from Myanmar to energy-hungry China.

With a capacity of 440,000 barrels of crude a day and 12 billion cubic metres of natural gas, the pipelines, which will run from this construction site in south-western China all the way to the Indian Ocean at the Bay of Bengal in Myanmar, are central to Chinese efforts to improve energy security as its economy continues to expand.

Russia\'s Yamal LNG to fully market LNG from project, take FID regardless of export rights Paris (Platts) - The Novatek-led Yamal LNG consortium\'s marketing of LNG from the project and final investment decision are not dependent on whether the Russian government would allow companies other than Gazprom to export gas from the country, representatives from Yamal LNG and Total said Tuesday.

French-Asian firms reveal LNG contract in Canada A consortium comprising French, South Korean and Chinese companies has won a contract for a liquefied natural gas project in Canada, the French partner Technip said on Wednesday.

The other partners are Samsung of South Korea and Huanqiu of China.

Poland Shale Boom Falters as State Targets Higher Taxes Poland?s shale gas boom is threatened even before it gets started after some wells failed and the government sought to increase taxes on profits.

Of 39 wells planned for 2013, just two were drilled by May, Environment Ministry data show. The government plans to require that explorers take a state-run company as a production partner. It has also proposed raising taxes to almost 80 percent of profit, according to Ernst & Young estimates. The measures, announced in October, haven?t become law.

Arctic Refuge Oil Targeted by Alaska Amid U.S. Reluctance Alaska?s government proposed investing its own cash in an assessment of oil reserves in the U.S. Arctic National Wildlife Refuge, seeking to prod the federal government to consider drilling in the protected area.

Canadian Pacific Spills Most Oil in Three Months in Saskatchewan Canadian Pacific Railway Ltd. rail cars spilled 545 barrels of crude oil near Jansen, Saskatchewan, in the company?s third and largest oil spill in as many months.

Japan Atomic Blasts Regulator on Ruling That Keeps Reactor Shut Japan Atomic Power Co., which has Tokyo Electric Power Co. as its largest shareholder, said a decision by the regulator that will keep one of its nuclear reactors off line is ?unacceptable.?

The Nuclear Regulation Authority, set up after the Fukushima disaster, today approved a report by its advisory board that said the No. 2 reactor at Japan Atomic?s Tsuruga plant has been built on an active earthquake fault.

Tesla\'s Glory Days Will Be Few As Bigger Competitors Are Already Catching Up Despite this big drawback though, Elon Musk\'s plan for the company seems to be going exceptionally well. It started from expensive cars for affluent early adopters and car enthusiasts and is working its way down to the masses with more affordable models. And currently Tesla is two or three models before the \"available to the masses\" stage, Model X included.

However, investors in Tesla should be extremely cautious. Although the company is way ahead of its competitors in the electric car market, this may prove to be an advantage with an extremely tight expiring date.

To harness the sun, first break it into little pieces In a region that derives its electricity from sprawling power plants that generate millions of kilowatts every day, it is little surprise that the advance of solar power is measured in utility-scale arrays.

Abu Dhabi kicked off a trend that will involve huge swaths of desert being covered with solar equipment over the coming decades when it inaugurated the Shams-1 plant in March.

Ban Ki-moon: World on course to run out of water Ban Ki-moon has warned the world is on course to run out of freshwater unless greater efforts are made to improve water security.

Speaking on the UN?s International Day of Biological Diversity, Ban said there was a ?mutually reinforcing? relationship between biodiversity and water that should be harnessed.

Forget peak oil?start worrying about peak water A report released today by the US Geological Survey (USGS) today shows that Americans are sucking dry the aquifers that irrigate their crops and supply their drinking water. Between 1900 and 2008, the US lost 1,000 cubic kilometers (240 cubic miles) of groundwater. That?s twice the volume of the water in Lake Erie.

It gets worse. The rate of groundwater depletion is accelerating, according to the study of 40 major US aquifers. Between 1900 and 2008, the US lost an average of 9.2 cubic kilometers of groundwater annually as the growth of cities and industrial agriculture tapped underground reserves. But between 2000 and 2008, groundwater depletion jumped 171% to an average of 25 cubic kilometers a year. In just those nine years, the amount of water pumped from the Ogallala aquifer, which supplies a large swath of the US, was equivalent to 32% of the water that was depleted from the Ogallala during the entire 20th century.

Subsidies urged to help power stations move away from coal HUGE coal-fired power stations such as Drax and Eggborough could ?switch off? if the Government does not provide the necessary subsidies to support their conversion to burning wood, an MP has warned.

Dan Byles, the Tory chairman of the All Party Parliamentary Group for the environment, and a member of the Commons energy and climate change committee, said the UK ?cannot afford? not to use biomass as a key source of energy over the coming years.

Deadly Moore Tornado Tops the Scale at EF-5 Complete and utter destruction in some parts of Moore, Okla., in the wake of yesterday\'s deadly tornado confirms the twister was a rare EF-5 ? the top of the tornado rating scale, the National Weather Service announced today (May 21).

Deadly Tornadoes Drive Up Storm-Shelter Demand In Bill Stegman\'s office on the eastern side of Dallas, the phone is ringing and ringing and ringing again, with only short breaks between callers. It goes on for some 30 minutes, virtually uninterrupted. He says it\'s been like this for hours.

The powerful and deadly tornadoes that have torn through Granbury, Texas, and Moore, Okla., in the last week are fueling this activity. What these dialers have in common is the hope that Stegman, the owner of storm-shelter installation company American Tornado Master, can keep them from being the next victim. He\'s been in this business 36 years, and he says he\'s never seen interest this high.

Does Climate Change Impact Tornadoes? The Scientific Jury Is Still Out There\'s no debating the devastation of the two-mile-wide tornado that leveled much of Moore, Oklahoma, yesterday, May 20. The Oklahoma City suburb, situated right in the heart of Tornado Alley, suffered unimaginable loss of life and destruction: 24 deaths, including nine children, and an untold number of pulverized buildings, including schools and hospitals.

But, is this particular type of extreme weather caused by climate change?

Short answer: Depends on whom you ask and how you ask it.

Fossil fuel divestment campaign\'s victory in Australia will be a moral one Divestment campaigns historically have never been about economic pressure. The effectiveness of the South African apartheid divestment campaigns were due to the moral pressure they placed on governments and businesses. They made toleration of apartheid in the USA, Britain and other countries (including Australia) impossible. University campuses were the hubs of much of the campaign activities, engaging not just students but academics and the trustees of university administered funds.

The divestment by the University of California Berkeley\'s divestment of $3 billion in 1986 was later credited by Nelson Mandela as a catalyst for the collapse of the apartheid government.

Unfortunately, there\'s every indication that the big fossil fuel companies targeted by McKibben ? like Exxon, BP, Chevron and BHP Billiton ? are less concerned than Apartheid South Africa was in global public opinion. For example, BP has managed to bounce back from the Gulf of Mexico oil spill.

Plan to protect community from sea level rise Lake Macquarie Council has started work on a plan to protect Marks Point and other lakeside suburbs from flooding as a result of rising sea levels.

Council says it has begun the community consultation process on the adaptation plan which will take 18 months to complete.

Climate Policies Must Break Free From Big Oil The big ?green? story here in Brussels lately hasn?t been the perilous state of the planet but the problems befalling the EU?s emissions trading scheme. Although the scheme has proven to be disastrous in terms of mitigating climate change, it has helped entrench the idea that heat-trapping gases should be considered as a tradable commodity. Because there are people out there who stand to make millions from carbon transactions, it?s not surprising that they want to salvage the Union?s scheme.

Climate-change disasters worry UN New York: The world needs to wake up to the risk of a spike in natural disasters linked to climate change and strive to find ways to cut the human and economic cost, the United Nations warned yesterday. \"We live in a time of huge natural disasters which are made worse by climate change,\" the UN\'s deputy secretary-general, Jan Eliasson, told reporters at the start of a three-day conference on risk reduction in Geneva.

\"Natural disasters are not only becoming more frequent but are becoming more vehement,\" he warned. ', this, event, '150px')">Drumbeat: May 22, 2013 (4 days ago)
Wells Dry, Fertile Plains Turn to Dust Vast stretches of Texas farmland lying over the aquifer no longer support irrigation. In west-central Kansas, up to a fifth of the irrigated farmland along a 100-mile swath of the aquifer has already gone dry. In many other places, there no longer is enough water to supply farmers? peak needs during Kansas? scorching summers.

And when the groundwater runs out, it is gone for good. Refilling the aquifer would require hundreds, if not thousands, of years of rains.

This is in many ways a slow-motion crisis ? decades in the making, imminent for some, years or decades away for others, hitting one farm but leaving an adjacent one untouched. But across the rolling plains and tarmac-flat farmland near the Kansas-Colorado border, the effects of depletion are evident everywhere. Highway bridges span arid stream beds. Most of the creeks and rivers that once veined the land have dried up as 60 years of pumping have pulled groundwater levels down by scores and even hundreds of feet.

Insight: The fight for North Dakota\'s fracking-water market WATFORD CITY, North Dakota (Reuters) - In towns across North Dakota, the wellhead of the North American energy boom, the locals have taken to quoting the adage: \"Whiskey is for drinking, and water is for fighting.\"

It\'s not that they lack water, like Texas and California. They are swimming in it, and it is free for the taking. Yet as the state\'s Bakken shale fields have grown, so has the fight over who has the right to tap into the multimillion-dollar market to supply water to the energy sector.

WTI Crude Halts Three-Day Advance; Syria Starts Offensive West Texas Intermediate crude snapped a three-day gain. Syrian government forces started an offensive against rebels, renewing concern that conflict may destabilize the Middle East.

Futures declined in New York after rising for a third day on May 17. Government forces retook most of the strategic city of Al-Qusair in central Syria, state-run SANA news agency said. Iraq resumed crude exports via Turkey after a bomb attack targeted an oil pipeline on May 17. Hedge funds and other money managers raised bullish bets on Brent to their highest level in six weeks, according to data from ICE Futures Europe.

?Syria is a microcosm of the unrest across the Middle East and could spread to other countries,? said Christopher Bellew, a senior broker at Jefferies Bache Ltd. in London.

Hedge Funds Boost ICE Brent Crude Net-Longs to Six-Week High Hedge funds and other money managers raised bullish bets on Brent crude to their highest level in six weeks, according to data from ICE Futures Europe.

U.S. Gasoline Rises to $3.6566/Gallon in Lundberg Survey The average price for regular gasoline at U.S. pumps rose 11.19 cents a gallon in the past two weeks to $3.6566 a gallon, according to Lundberg Survey Inc.

The survey covers the period ended May 17 and is based on information obtained at about 2,500 filling stations by the Camarillo, California-based company.

Gas prices lower, but not leading to more spending NEW YORK (CNNMoney) - Gas prices are slightly lower this year, but that\'s not leading to a large pick-up in consumer spending, according to a survey by Bankrate.com.

About 80% of the 1,000 people Bankrate surveyed said they have not increased their discretionary spending in response to falling gas prices this year.

Saudi Arabia to import near record high diesel this summer Saudi Arabia will import near record high diesel volumes this summer, as it gears up to beat the sweltering heat and meet rising travel needs during the Muslim fasting month of Ramadan, trade sources said.

State oil giant Saudi Aramco will import up to 8.9 million barrels of diesel in June, up from an estimated 6.7m to 7.5m barrels in May, according to the sources, who expect at least the same volume or higher to be booked for July.

Saudis Cut March Crude Exports as West Africans Boost Shipments Saudi Arabia, Kuwait, and Venezuela reduced crude oil exports in March from the previous month while West African members of the Organization of Petroleum Exporting Countries increased shipments, according to official data.

Qatar sets up $1 billion energy infrastructure fund DOHA (Reuters) - Three Qatari state-backed entities, including the Gulf Arab nation\'s acquisitive sovereign wealth fund, are setting up a $1 billion fund to invest in overseas energy infrastructure assets.

Natural Gas Rises 5% From Week Ago as U.S. Approves LNG Exports Natural gas futures extended gains after the U.S. conditionally approved a Texas liquefied natural gas project.

Chesapeake names Anadarko executive as new CEO OKLAHOMA CITY (AP) -- Chesapeake Energy has named Anadarko Petroleum executive Robert Douglas Lawler as its new CEO.

The appointment of the 46-year-old Lawler comes after a tough year for Chesapeake. Its former CEO Aubrey McClendon was ousted last year amid a scandal over his personal investments in the company\'s oil and gas wells.

Massive penalty brings down top executives in Kuwait oil sector KUWAIT CITY - Kuwait\'s vital oil sector has undergone a major reshuffle, with new executives appointed for the subsidiaries of Kuwait Petroleum Corp, after a new KPC chief was named, the national oil firm said Monday.

The decisions were taken at a meeting late Sunday by KPC board of directors headed by Oil Minister Hani Hussein, replacing all the top executives of the eight subsidiaries and other departments in the KPC.

United to restart 787 flights on Monday United Airlines is getting its 787s back in the air.

The planes are returning after being grounded for four months by the federal government because of smoldering batteries on 787s owned by other airlines. The incidents included an emergency landing of one plane, and a fire on another.

Commutes long, slow after Conn. train derailment BRIDGEPORT, Conn. (AP) ? Connecticut commuters embarked on long, slow trips to and from work Monday following last week\'s train collision that that injured 72 people and disrupted rail service into New York City.

Connecticut Gov. Dannel P. Malloy said commuters should prepare for a week of disruption.

Fill \'er up at Blu ... with natural gas (Fortune) - If you drive down I-15 past State Highway 160 in Beaver, Utah, you\'ll see a 30-foot-tall silo with white letters that spell out \"Blu.\" Next to it is a truck stop. It is no ordinary truck stop. The silo contains liquefied natural gas (LNG) chilled to -200', this, event, '150px')">Drumbeat: May 20, 2013 (5 days ago)
Global Energy Systems conference, which will take place in Edinburgh, United Kingdom from June 26 - 28 2013. The conference is meant to deliver key updates on the most pressing energy issues and challenges facing our energy system, as well as providing a forum for exchange of substantially different viewpoints. It is supported by several universities and research institutes including University of Aberdeen, University of Edinburgh, Oxford Research Group, Chatham House and others.

The scope is deliberately very broad, covering most primary energy sources, so that a global view of the current energy system can be presented. Session topics include ?the limits to easily accessible fossil fuels?, ?frontier fossil fuel technologies and basins?, ?the viability of nuclear power?, ?the costs and benefits of fossil versus renewable electricity?, and ?the economics and policy of energy systems?. A few of our confirmed speakers include Michael Kumhof (IMF), Sir David King (former Head Smith School Oxford University), Friedrich Schulte (Head of Technologies RWE), Dr. William Blyth (Director Oxford Energy Associates) , Peter Jackson (IHS CERA), Lord Ron Oxburgh (House of Lords UK Parliament), Richard Stainsby (Chief Technologiest UK National Nuclear Laboratories), Alexander Naumov (Group Economics BP), Guy de Kort (Shell Vice President GTL), and Tatiana Mitrova (Head Oil & Gas Energy Research Institute Russian Academy of Sciences).

Read below the fold for an overview of the conference programme and confirmed speakers to date.

General information 1st Global Energy Systems Conference

Our Dynamic Earth, Edinburgh, United Kingdom

Wednesday June 26 to Friday June 28, 2013

Registration open - early bird deadline passed

General interest, media and sponsorship enquiries The conference is organized on a non-profit basis by a group of energy professionals concerned about the challenges that we face. Any expressions of interest, suggestions for content and analysis, and contributions of sponsorship, are most welcome. Your content, media, and sponsorship related communication can be directed to: alexr at scenetwork.co.uk Conference Programme

Day 1 | Wednesday 26 June | Fossil Fuels: Can we turn Unconventional into Conventional? Day 2 | Thursday 27 June | The Future of the Electricity System Day 3 | Friday 28 June | The Economics and Policy of Energy Systems Day 1 ? Fossil Fuels: Can we turn Unconventional into Conventional? Conference Opening 08:00 ? 09:00 Registration | Coffee & tea 09:00 ? 09:40 Welcome and Sponsor address Programme Committee and Sponsors 09:40 ? 10:25 Keynote Address on the Global Energy Challenges Lord Ron Oxburgh, House of Lords UK Parliament 10:25 ? 10:50 Coffee & tea The Limits to Easily Accessible Fossil Fuels 10:50 ? 11:15 Fossil Fuel Production forecasts: analysis of resource and reserve assumptions and model mechanics Joint Paper convened by Dr. Roger Bentley 11:15 ? 11:40 Perspectives on China\'s Coal Industry and Future Kevin Jianjun Tu, Senior Associate Carnegie 11:40 ? 12:05 The Architecture and Drivers of Future Oil Supply Dr. Peter Jackson, Head of Research IHS CERA 12:05 ? 12:30 Russia\'s Natural Gas Production & Export Policy Dr. Tatiana Mitrova, Head Oil & Gas, Energy Research Institute Russian Academy of Sciences 12:30 ? 13:30 Lunch Break Frontier Fossil Fuel Technologies and Basins 13:30 ? 13:55 The future of US shale/tight oil Dr. Kenneth Chew 13:55 ? 14:20 Oil and gas recovery from continuous (unconventional) resources: Technology innovation options for improving the economic baseline Dr. Ruud Weijermars, Director TU/Delft Unconventional Gas Research Initiative 14:20 ? 14:55 Key developments and challenges of Enhanced Oil Recovery techniques and CO2 Solutions Prof. Mehran Sohrabi, Institute of Petroleum Engineering, Heriot-Watt University 14:55 ? 15:10 Refreshment Break 15:10 ? 15:35 The current status of Underground Coal Gasification as a Commercial Technology Dr. Peter Dryburgh, Wardell Armstrong 15:35 ? 16:00 Gas to Liquids - an opportunity to convert natural gas for use in the transport sector Guy de Kort, Shell Vice President GTL 16:00 ? 16:30 Coffee & tea Debate: Energy Scarcity, Threat or Fiction? 16:30 ? 17:30 Chaired By - Paul McConnell, Wood MacKenzie Consulting Viewpoint A: \"Upcoming technologies will unlock the unconventional resource base\" Panelist to be announced Dr. Roberto F. Aguilera, Research Fellow Curtin University, Australia. Viewpoint B: \"We can?t afford the energy, labour and capital cost to prolong the fossil fuel era\" Dr. Michael Kumhof, Deputy division chief, Modeling Unit International Monetary Fund (IMF) Kjell Aleklett, Professor, Global Energy Systems Group, Uppsala University Day Summary 17:30 ? 18:00 Closing of Day 1 Program Committee 18:00 ? 21:00 Drinks & Networking Event Separate tickets available

 

Day 2 ? The Future of the Electricity System Conference Opening 08:00 ? 09:00 Registration | Coffee & tea 09:00 ? 09:40 Welcome and Sponsor addressProgram Committee and Sponsors 09:40 ? 10:25 Keynote Address Dr. Jeremy Leggett, non-Executive chairman Solarcentury, Chairman Solaraid 10:25 ? 10:50 Coffee & tea The viability of Nuclear Power 10:50 ? 11:15 Should the UK nuclear programme be a model for the rest of Europe? Prof. Steve Thomas, Greenwich University 11:15 ? 11:40 The costs and economic viability of nuclear energy David Shropshire, Head Planning and Economic Studies, International Atomic Energy Agency 11:40 ? 12:05 Trends towards Sustainability in the nuclear fuel cycle Dr. Ron Cameron,', this, event, '150px')">Global Energy Systems - June 26-28 2013 (6 days ago)
become more complicated and delayed, with follow-on impacts on the ultimate yield in a number of Mid-Western states. Corn yield apparently falls at an average rate of 2.3 bushels per acre per day of delay in Northern Wisconsin. These changing conditions make it difficult to assess how much ethanol, for example, will be available to meet demand, although the latest EIA TWIP holds out some optimism for this year.

The impact of the drought on corn prices, and the consequent fall in ethanol production, as production costs rose, are directly visible from their plot of the two over the last year.

Figure 1. A comparison of corn prices and ethanol production in the USA (EIA TWIP )

However, with the weather impacts still being assessed it is already being concluded that the US corn crop is unlikely to reach the record level of close to 14.6 billion bushels that were earlier projected. It still, however, has the potential to reach around 12.3 billion bushels, which would satisfy the just under 5 billion bushel need for ethanol, as well as other demands of the market. By May 12th only 28% of this year\'s expected crop had been planted, in contrast with a normal year where 65% would be in the ground. Thus even the relatively short-term projections of the EIA could yet be in trouble for this year.

Moving to the slightly longer-term the nations that form OPEC must try and estimate global demand for their products, and the amount that other non-OPEC nations will produce, so that they can balance supply and demand at such a level that will sustain prices at a level they are comfortable with. Their estimates come out as Monthly Oil Market Reports and in the latest (May) version they continue to expect global demand to increase by 0.8 mbd over 2013, but are beginning to hedge that bet, as the global economy continues to appear anemic, with Russian and Asian economies slowing. Yet by the fourth quarter of the year they anticipate that global demand will reach 90.9 mbd.

Figure 2. Global oil demand by region (OPEC MOMR)

OPEC anticipates that, with the major increase coming from the Americas, that non-OPEC oil production will increase by just under 1 mbd to reach an a level of 54.41 mbd in the fourth quarter of the year. The majority of that growth (some 0.59 mbd) will come from the United States, with the Permian, Bakken and Eagle Ford being cited as the anticipated source of these gains. OPEC, having looked at current rig counts, project that these numbers may be revised upwards over the course of the year. And yet it is worth noting this:

On a quarterly basis, US oil supply is seen to average 10.62 mb/d, 10.67 mb/d, 10.62 mb/d and 10.61 mb/d respectively.

The sustained gain in North American production comes about because:

On a quarterly basis, Canada’s production is anticipated to average 4.02mb/d, 3.97 mb/d, 4.02 mb/d and 4.12 mb/d respectively.

Russia is expected to continue to lead in oil production over the course of the year, although it is not longer expected to increase production above current levels.

On a quarterly basis, Russian oil supply is seen to average 10.45 mb/d, 10.43 mb/d, 10.43 mb/d and 10.43 mb/d respectively.

And this brings us back around to OPEC as they try and balance their production against the gap between global demand and non-OPEC supply. As has been the case for a while, OPEC produced two separate tables showing production, as reported by secondary sources, as well as those directly reported by the countries themselves.

Figure 3. OPEC member production as reported by secondary sources (OPEC MOMR)

Figure 4. OPEC member production as reported directly (OPEC MOMR)

It would appear, with Manifa coming on line, that Saudi Arabia is increasing production again, while Venezuela and Iran would have you believe they are producing more than they are, and Iraq, which is now producing above 3 mbd, is directly reporting less (though that could be because some of that production is coming from the north, and there are some communication problems between there and Baghdad).

As long as OPEC has available reserves it can continue this balance to keep enough oil available at an acceptable price to allow the world economy to continue at its present pace. And with that ongoing adjustment available, their projections for this year of a relatively stable price would seem fairly founded, absent some major change in one of the larger producing states.

Iraq overtook Iran as the second largest producer in OPEC last year (according to secondary sources) and expects that with production from Majnoon, it will increase production capability by upwards of 200 kbd by the end of the year. Ultimately the goal is to achieve a target production of 1.8 mbd. However, as overall production levels increase, Iraq may join with the Kingdom in controlling production to maintain price.

Yet even with those abilities OPEC is becoming cautious over predicting that their estimate of the demand:supply balance numbers for this year will be accurate over that time interval.

With these uncertainties in even short-term projections of future production whether it be corn, ethanol or crude it is perhaps wise to continue a somewhat cynical view of projections over a longer time period. Although the bounding bar of a decline in existing field production continues to exist and will continue to require an offset in increased production from new wells to offset. Perhaps that lady in the tent of my youth may prove as prescient as some of the more optimistic forecasts that we continue to see.

', this, event, '150px')">Predicting the weather, corn, ethanol and oil production. (7 days ago)
Energy Department approves expanded LNG exports The Energy Department gave a terminal near Freeport, Tex., permission Friday to ship liquefied natural gas to Japan, providing a new outlet for rising U.S. production of shale gas despite qualms of environmentalists and many domestic manufacturers.

The permit marks another step in the sudden reversal of fortune in the natural gas business. Less than five years ago, anticipating a worsening shortfall in domestic supplies of natural gas, the Freeport terminal on Quintana Island began operations as an import facility.

But advances in hydraulic fracturing techniques have unlocked new supplies of natural gas from shale rock. Freeport, like other import terminals, now wants to spend $10 billion to retool the terminal so it can send gas abroad in liquefied form.

US DOE Approves Second US LNG Export Project to Non-FTA Countries The US Department of Energy has authorized Freeport LNG Expansion, L.P. and FLNG Liquefaction, LLC (Freeport) to export LNG to so called non-Free Trade Agreement (non-FTA) countries. Subject to environmental review and final regulatory approval, Freeport is conditionally authorized to export up to 1.4 (Bcf/d) for a period of 20 years.

Despite lacking FTA, Japan to get U.S. LNG NEW YORK ? The United States said Friday it will allow exports of domestically produced liquefied natural gas to Japan and other countries to which it is not bound by free-trade agreements, authorizing a plan to deliver shale and other gases from Texas.

WTI Crude Rises on Speculation Growth Will Boost Demand West Texas Intermediate crude advanced to a one-week high on signals that global economic growth will accelerate, bolstering fuel consumption.

Futures increased 0.9 percent as the Thomson Reuters/University of Michigan preliminary index of consumer sentiment rose to 83.7 in May, higher than any projection in a Bloomberg survey. A government report yesterday showed Japanese gross domestic product grew 3.5 percent at an annualized pace, the most in a year.

Soaring gasoline prices hurt Oklahoma City area retailers Ballard owns the Varsity Valero and Guzzlers convenience stores in Purcell.

Two years ago, he spent $500 to upgrade his signs so they can display prices above $4. He said he hopes he doesn\'t have to use them. But with wholesale prices soaring as much as 70 cents a gallon in the past five weeks, there seems to be no end in sight.

Convenience store owners throughout the state are facing the same challenge.

Pemex Makes Third Ultra-Deep Find at Mexico Gulf Maximino Field Petroleos Mexicanos, the world?s fourth-largest oil producer, made its third ultra-deepwater discovery on the Mexican side of the Perdido basin in the Gulf of Mexico.

Tests at the Maximino field where the crude was found are still being made and volumes are being assessed, Luis Ramos, a strategic planning manager at the Mexican state-owned oil producer?s exploration unit, told reporters in Rio de Janeiro today, declining to give any estimate.

Afghanistan to begin first commercial oil production Afghanistan expects to begin the first commercial oil production in its history in a little under two months.

The country\'s mining minister, Wahidullah Shahrani, has told the ABC processing will start at the Amu Darya basin in Afghanistan\'s north in July.

The project is operated by the China National Petroleum Corporation and is expected to eventually supply Afghanistan with its domestic energy needs so it can stop importing oil.

Afghanistan turns to Australia for mining expertise Australia could help Afghanistan develop its fledgling mining industry and tap into mineral and energy reserves estimated to be worth trillions of dollars.

The country is eager to find a new source of revenue when international aid starts to decline and foreign forces withdraw next year.

Liberia\'s Johnson-Sirleaf defends governance record Sirleaf, a Nobel Peace Prize winner and Africa\'s first freely elected female president in 2006, has won international acclaim for her \"zero tolerance\" stance against corruption and for turning around a country devastated by 14 years of sporadic civil war that ended in 2003.

Since then, Liberia\'s enormous resource wealth has attracted a flood of interest from foreign investors. The government has signed major mining and oil contracts including a $1.5 billion deal with Anglo-Australian miner BHP. It has also signed offshore deals with Chevron Petroleum and Exxon Mobil.

Ten Years After Invasion, Iraq Continues to Import Oil Products Former Iraqi oil minister Issam al-Jalabi says that although Iraq is an oil-rich country, it still imports petroleum products from abroad to meet its needs 10 years after the US-led invasion of the country.

Jalabi, an international energy expert, told Azzaman that annual imports of oil derivatives reached $6 billion a few years after the occupation.

Iran Wants More Money From You Americans spent more money on gasoline in 2012 than in any other year... ever. Meanwhile, here in 2013, retail gasoline prices spiked to $3.60 a gallon on average -- $3.94 on the West Coast -- the sharpest rise in prices seen in the past three months. And Iran is happy to hear it.

In fact, if the Islamic Republic has anything to say about it, Americans could wind up paying even more for gas than we already do. Right now, a barrel of benchmark crude costs about $95. But over the weekend, Iranian Oil Minister Rostam Ghasemi was quoted arguing that \"the price of crude oil [should] remain at about $100.\" Ghasemi thinks that price \"is fair, and Iran supports it.\"

Turkey not halting Iran oil imports Turkish Prime Minister Recep Tayyip Erdogan says Ankara has not yet made any decision on cutting oil imports from Iran, despite US pressure to hinder the Tehran-Ankara energy cooperation.

Speaking at the Brookings Institution in Washington on Friday, the Turkish premier said the level of oil imports from Iran depends on his country?s energy demand.

South Korea reduces crude imports from Iran by half in April Baku. Real Jafarli ? South Korea, the world?s fifth-largest oil importer, cut crude shipments from Iran by 51 percent in April from a year earlier, customs data show, APA reports quoting Bloomberg.

Pakistan wheat for Iran to pay electricity bill ISLAMABAD: Islamabad has authorised the export of 100,000 tonnes of wheat to Iran in trade not jeopardised by Western sanctions, to settle dues for electricity supplied to Pakistan?s energy-starved border areas, the Commerce Ministry said yesterday.

Van Rompuy voices concern at Europe\'s \'energy dilemma\' European council president Herman Van Rompuy has voiced concern about Europe\'s \"energy dilemma\".

Opening the European business summit in Brussels on Wednesday, he said, \"It\'s now becoming clear; eventually Europe may well be the only continent in the world to depend on imported energy.

\"Already by 2035 our dependence on oil and gas imports will reach more than 80 per cent.

\"This will have an impact on the competitiveness of our companies, and of our economy as a whole.\"

Iranian President Could Attend Russia?s Gas Forum in July MOSCOW (RIA Novosti) ? Iranian President Mahmud Ahmadinejad is expected to visit Russia in July to attend the Gas Exporting Countries Forum (GECF), a spokesman for Iran?s Embassy in Moscow said on Saturday.

The Iranian leader has accepted Russia?s invitation to attend the event. ?Now we are working on this visit, but the final decision has yet to be made,? the spokesman told RIA Novosti.

Why Venezuela is running out of toilet paper Right now, the scarcity index in Venezuela is at 21 percent ? meaning that out of 100 basic goods, 21 of them aren\'t available on store shelves. Lines for commodities like milk, sugar, cooking oil, corn flour used to make arepas, and, yes, toilet paper, can often stretch down the block.

The flip-side of state-controlled prices, writes the BBC\'s Irene Caselli, is that poor Venezuelans can afford foods that they couldn\'t before. A kilogram of pasta costs 30 cents at government-run supermarkets. At private markets, it costs 10 times as much.

That has led to a drop in the number of Venezuelans who are undernourished, to less than 5 percent today, from 15 percent in 1999, according to the BBC.

Oil-price manipulation: the next Libor? NEW YORK (CNNMoney) - Some of the world\'s biggest oil companies may have a new mess on their hands.

The European Commission raided the offices of Shell, BP and Norway\'s Statoil this week as part of an investigation into suspected attempts to manipulate global oil prices spanning more than a decade.

None of the companies have been accused of wrongdoing, but the controversy has brought back memories of the Libor rate-rigging scandal that rocked the financial world last year.

Wall Street Wins Rollback in Dodd-Frank Swap-Trade Rules JPMorgan Chase & Co., Goldman Sachs Group Inc. and the world?s largest banks won rollbacks in final Dodd-Frank Act rules that promise to transform the private swaps market by increasing competition.

The Commodity Futures Trading Commission voted 4-1 in Washington today on rules determining how buyers and sellers must trade credit-default, interest-rate and commodity swaps in a $633 trillion global market. The rule weakened a proposal by reducing the number of price quotes buyers must seek on swap-execution facilities after banks and asset managers said a five-quote requirement was onerous and would impair trading.

South Stream to be Realized The Chief Executive of the South Stream Transport has brushed aside concerns over economic viability and technological challenges, stating that project to transport natural gas from Russia to the European Union is on schedule to be built by the end of 2015.

?It?s a reality,? Marcel Kramer told Reuters, adding that the company was close to concluding financing for the $39 billion project by early 2014.

These 3 Stocks Will Continue to Surge During the Shale Revolution Shale gas is a game changer. We are in the very early innings of this process and investors still have ample opportunity to position their portfolio to capitalize on the phenomenon. Stocks poised to benefit have already made strong moves, but substantial upside remains if one takes a patient, long-term approach. This is a secular story that will play out over the next decade. Thus certain stocks stand poised to reap outsized gains in the next decade, but they will still be at the whim of market psychology and prone to substantial volatility over short-term periods. Gains certainly won?t be realized in a steady pattern and most likely via large upside moves followed by sharp pullbacks. But at the end of the day, the equities listed below will likely make the list of ten-year outperformers.

BP, Transocean Are Sued by Texas Over 2010 Gulf Oil Spill Texas sued BP Plc, Transocean Ltd. and others involved in the 2010 oil spill, calling it the ?worst environmental disaster? in U.S. history and becoming the fifth Gulf of Mexico state to file claims.

The state accused the companies of violating Texas environmental laws, and is seeking damages for economic loss, including lost tax revenue, as well as for harm to natural resources. Texas asked for civil penalties for every day of oil discharge and every barrel that was dumped into the gulf.

A Black Mound of Canadian Oil Waste Is Rising Over Detroit WINDSOR, Ontario ? Assumption Park gives residents of this city lovely views of the Ambassador Bridge and the Detroit skyline. Lately they?ve been treated to another sight: a three-story pile of petroleum coke covering an entire city block on the other side of the Detroit River.

Detroit?s ever-growing black mountain is the unloved, unwanted and long overlooked byproduct of Canada?s oil sands boom.

Scaled-Back U.S. Fracking Rule Draws Qualified Praise Oil and gas industry representatives offered qualified support for a U.S. proposal to govern hydraulic fracturing on public lands that establishes federal oversight while deferring to state standards in some cases.

Shell Reported Power Outage, Issues at Anacortes Refinery Royal Dutch Shell reported a power outage earlier this week at its Puget Sound refinery in Anacortes, Wash., and subsequent issues while restarting units, according to a filing with the Northwest Clean Air Agency released Friday.

Enron\'s Jeff Skilling doesn\'t deserve a break The man behind the firm\'s massive collapse is seeking to shave as much as 10 years from his prison term. That would perpetuate a culture of fraud in the boardroom.

Commuter Train Wreck Injures Dozens, Curbs Amtrak Service Two Metro-North Railroad commuter trains collided in Bridgeport, Connecticut, injuring dozens of people and limiting Amtrak service between New York and Boston in one of the worst U.S. passenger rail accidents since 2008.

Is There Room on the Road for These Alternative Cars? Most of the world?s roads are dominated by only a few auto brands. However, there is a multitude of automakers on the fringe that are trying daring new things with their vehicles. The question is whether they can ever share the road with the leading manufacturers? cars.

2012 record-breaking year for wind power 100 countries worldwide now produce electricity with wind power. So far, it\'s a boom that has mainly occurred in Asia, North America and Western Europe. Now, Eastern Europe and Latin America are getting involved.

Last year, more wind turbines were erected than ever before worldwide, according to statistics released today (16 May 2013) by the World Wind Energy Association (WWEA) in Bonn, Germany.

Solar power a ray of hope for planet as carbon emissions rise Wind and solar are on the way to becoming so cheap that Lovins says: \"It doesn\'t matter if we never run out of oil: we won\'t want to burn it anymore.\"

It\'s a comforting thought, but renewable power still has to fight the battle against determined big oil paymasters of powerful politicians.

Planet Earth: A corporate world Which are the biggest companies in the world? Which corporations control them? How does their power compare with states?

It?s the End of the World but We?ll Be Fine It?s the end of the world as we know it, but the futurists feel fine. A new book explores the history of mass extinctions and how the human species can survive the next one. But will we survive?

Who does the Mississippi really belong to? New Orleans ? Consider this: It?s spring 2025 and Louisiana officials are preparing to open three diversions on the lower Mississippi River so fresh water and sediment can reach wetlands struggling to stay ahead of sea-level rise.

But the river has dropped to a record low, and the Port of New Orleans warns taking so much water from the river will ground ships downstream of Venice.

At the same time, salty Gulf water moving upstream against the low river threatens municipal water supplies, as well as cooling intakes at oil refineries, chemical plants and power stations. They want the diversions to stay shut.

Meanwhile, all three uses of the river could be disrupted if Arkansas is allowed to open a structure on the river to send millions of gallons of water to Western states willing to pay top dollar to relieve a drought devastating farms and cities.

Zombie climate sceptic theories survive only in newspapers and on TV Like a cardiac monitor warning of a soon-to-be lifeless patient, for more than 20 years the red line hovers around zero showing barely a flicker of life. Cook says they expected to see a rising number of papers which had \"no position\" and didn\'t feel the need to state the obvious \"just as geographers find no reason to remind readers that the earth is round\".

In other words, the alternative arguments about the causes of global warming were already dead or dying 20 years ago.

Yet since then, climate science contrarians/deniers/sceptics have continually applied the defibrillator paddles to these failing theories in an attempt to bring them back to life.

Busting the carbon budget: Kemp (Reuters) - Budgets are made to be broken - especially when they are written by politicians.

Unfortunately it seems the world is on course to break the carbon budget that scientists and policymakers agree is necessary to limit the rise in global temperatures to less than 2 degrees Celsius.

UK\'s climate change adaptation team cut from 38 officials to just six The number of people employed by the government to work on the UK\'s response to the effects of climate change has been cut from 38 officials to just six, triggering accusations that David Cameron\'s promise to be the greenest government has been abandoned.

Ignoring the cost of climate change is bad business In the financial markets, volatility is rising and all manner of derivatives are employed to hedge against potentially catastrophic losses. In the real world, the climate is becoming more volatile, yet cities and businesses ? make that entire industries ? are doing little to protect themselves from extreme weather.

China opposes EU\'s aviation emissions levy Beijing (IANS) China has opposed the European Union\'s (EU) unilateral decision to incorporate international flights originating from countries outside of the EU into its carbon trading scheme, reported Xinhua.

Forget pipelines ? Canada must prepare for a post-carbon world Although many in Canada, both in the oil industry and government, may prefer to pretend that there are no climate-related limits, the rest of the world (and many Canadians) are waking up to the fact that projected global warming ? due overwhelming to our emissions of CO2 from the burning of fossil fuels ? poses a real and serious threat to the future well-being of the entire human race and of all life on this planet.

Rebuilding the Coastline, but at What Cost? When a handful of retired homeowners from Osborn Island in New Jersey gathered last month to discuss post-Hurricane Sandy rebuilding and environmental protection, L. Stanton Hales Jr., a conservationist, could not have been clearer about the risks they faced.

?I said, look people, you built on a marsh island, it?s oxidizing under your feet ? it?s shrinking ? and that exacerbates the sea level rise,? said Dr. Hales, director of the Barnegat Bay Partnership, an estuary program financed by the Environmental Protection Agency. ?Do you really want to throw good money after bad??

Their answer? Yes. ', this, event, '150px')">Drumbeat: May 18, 2013 (7 days ago)
Avoiding the \'Energy Abyss\' John Hofmeister doesn?t call it ?peak oil,? instead he calls it the ?energy abyss,? the point at which the global economy ceases to grow because the oil industry can no longer meet demand.

Hofmeister is the former president of Shell Oil, the same Shell Oil that is preparing to drill the deepest hole yet drilled to reach oil and gas 200 miles out in the Gulf of Mexico in 9,500 feet (2,900m) of water, surpassing the working depth of Shell?s Perdido rig, also located out in the Gulf and producing around 100,000 barrels a day. The cost of that rig: $3 billion.

In his 2010 book, Why We Hate The Oil Companies, Straight talk from an energy insider, he wrote the following:

?It?s inevitable. The industry that produces oil can?t produce enough, unless the world doesn?t grow. It?s possible that we will have such expensive oil that we will stymie growth. How many people will suffer? How many poor will become poorer, while rich become richer because we have failed rational tests of creating alternative competitive fuels? We have a choice to condemn ourselves to an energy abyss in the name of the status quo and lack of enlightened leadership, or we can choose to develop alternatives.

Why aren?t we more thoughtful about the future? Why don?t we begin the journey towards a range of alternatives that delivers increased national security, increased economic security, and multiple choice for consumers?

I think in this regard, we are missing in the whole construct, a meaningful voice of government as an intermediary and an enabler to a better future when it comes to fuel choice. The US has been crippled for 7 years by high-priced fuel; the government has done nothing to speak of to address the issue.?

The Peak Oil Crisis: Supply Shock A new phrase, ?supply shock,? entered the lexicon of the global oil business this week when the International Energy Agency reported that unexpectedly rapid growth in tight oil production from North Dakota and Texas is leading to profound changes in the global energy markets.

U.S. oil production which grew by 800,000 barrels a day (b/d) last year is now expected to grow by another 2.3 million b/d by 2018. In addition another 1.3 million b/d increase from Canada?s oil sands is expected. This 3.9 million b/d accounts for nearly half of the 8.4 million b/d increase in global production of combustible liquids that the IEA is expecting to be available by the end of the decade.

Oil Price-Fixing Probe Widens as Neste Helps EU Inquiry The European oil price-fixing probe expanded as Neste Oil Oyj, Finland?s only refiner, said it was asked to provide information regarding potential manipulation of global crude and biofuel markets.

The widening investigation comes as Pannonia Ethanol, a Hungarian biofuel producer, said it lodged a complaint with the European Commission last year after data-pricing company Platts denied requests to contribute to its price-setting process. Meanwhile, Statoil ASA, one of the European oil companies that has been ensnared in the investigation, said it has ?zero tolerance? for breaches of rules.

Royal Dutch Shell Plc, BP Plc and Statoil, three of Europe?s biggest oil explorers, are being investigated by European Commission officials about potential manipulation of prices in the $3.4 trillion-a-year global crude market. Platts, owned by McGraw Hill Financial Inc., also is a target in the inquiry. The probe, which extends to undisclosed crude-derived products and biofuels, shows how some energy markets lack the transparency of stocks and U.S. corporate bonds.

WTI Fluctuates; Poised for First Weekly Drop in a Month West Texas Intermediate crude headed for the first weekly decline in a month after U.S. consumption of gasoline and distillate fuels dropped.

Futures fluctuated in New York after rising yesterday by the most in six days. U.S. gasoline consumption shrank 1.2 percent last week and demand for distillate fuels, including heating oil and diesel, decreased 2.4 percent, Energy Department data show. WTI may drop next week amid concern that weaker economic growth will reduce fuel use, according to a Bloomberg News survey.

?We still expect renewed downside pressure,? Andrey Kryuchenkov, an analyst at VTB Capital in London, said in an e-mail. ?Demand is yet to improve ahead of summer? in the U.S. and Europe, he said.

Refinery woes cause nationwide gas price spike Troubles at several oil refineries are driving gasoline prices sharply higher in the Midwest, and the regional shortages are expected to boost pump prices nationwide.

While the USA may be dripping in new found crude oil deposits and early May supplies were at their highest levels since the early 1930s, issues at a handful of refineries that turn crude into gasoline and diesel fuel underscore how kinks in the supply chain can cause quick surges in what consumers pay at the pump.

Consumer prices take biggest drop in 4 years, thanks to gas prices A sharp drop in gasoline costs led consumer prices to tumble in April by the most in over four years, while a gauge of underlying inflation was so weak it could worry the Federal Reserve.

The Labor Department said on Thursday its Consumer Price Index slipped 0.4 percent, the biggest decline since December 2008 when America was suffering some of the darkest days of its financial crisis. Analysts had expected a more modest 0.2 percent decline in last month\'s prices.

Does U.S. oil boom mean lower prices at the pump? The International Energy Agency says the oil fields of North Dakota are turning the global oil market on its head. Canada\'s oil sands, too, to be fair. The agency\'s latest report on world oil supplies says North America\'s oil boom is turning out to be even bigger than predicted. Within five years, the U.S. and Canada will be meeting most of the world\'s new oil demand.

Whoa. Wasn\'t it just a few years ago we were fretting about \"peak oil?\'

Fuel Oil Rally to End With Europe Swamping Asia The premium traders in Asia are paying for the earliest deliveries of fuel oil is poised to slide from an eight-month high as Europe floods the region with excess supplies and Chinese refinery demand wanes.

Global LNG-Latin America demand drives global spot market PERTH/LONDON: Latin American demand for liquefied natural gas (LNG) continued to dominate the global spot market this week, with Mexico\'s monthly LNG imports expected to hit a seven-year high in May.

Mexico\'s state-run power monopoly CFE will buy 18 LNG cargoes from energy trader Trafigura due to be shipped in 2013 and 2014 as piped natural gas supply from the United States fails to keep up with demand.

LPG Ship Rates Head for Biggest-Ever Weekly Gain on U.S. Cargoes The cost of shipping liquefied petroleum gas headed for the biggest weekly gain on record as surging U.S. exports of the cooking fuel and chemicals feedstock sap vessel supply.

Rates for very large gas carriers already jumped 24 percent to $68 a metric ton since May 10, according to the Baltic Exchange, a London-based publisher of shipping prices on more than 50 maritime routes. That would mark the largest weekly rally in data going back to 2005 if costs stay the same today or rise, according to the bourse.

Making choices early gives room to move in the future If we believe endless growth on a finite planet is possible, then it\'s all good. If we reckon the age of cheap oil will never end, we can party on.

But if we think the climate scientists are on to something, that resource use deserves special care and there may be some economic bumps ahead, then a rethink of our way of living is warranted.

China State Grid Buys Stake in SP AusNet for A$824 Million China State Grid Corp., the nation?s largest power distributor, agreed to pay Singapore Power Ltd. A$824 million ($810 million) for 19.9 percent of Australia?s SP AusNet as part of its $50 billion global acquisition plan.

The Chinese state-owned company will also acquire 60 percent of Singapore Power?s other Australian energy and infrastructure assets held by SPI (Australia) Assets Pty, the Singaporean company said today in a statement. That closely held unit, known as Jemena, manages more than A$5 billion of assets and had A$1.7 billion in sales in 2012, according to its website.

Nova Chemicals to start using shale gas in Ontario A major Abu Dhabi-owned petrochemical complex is due to become one of the first in the world to benefit from North America\'s shale bonanza.

Nova Chemicals, the Calgary-based company owned by the emirate\'s International Petroleum Investment Company, is due to start receiving gas from Pennsylvania\'s Marcellus field, a major shale deposit, by the end of this year.

Energy Future?s Woes Stunt Oncor?s Power Growth Ambitions Oncor Electric Delivery Co., Texas? largest power utility, may not be able to take full advantage of the nation?s fastest-growing electricity market because of capital constraints lingering from its parent?s 2007 leveraged buyout.

Oncor would have to cut dividend payments to Energy Future Holdings Corp. if the Texas electricity distributer wanted to fund another major project in the state where it serves more than 3 million homes and business, Chief Executive Officer and Chairman Bob Shapard said.

Green party has decades-in-making breakthrough in B.C. election VANCOUVER - The British Columbia Green party made a historic breakthrough in the provincial election this week, powered on what appeared to be opposition to oil pipelines and concerns about global warming.

Andrew Weaver, a University of Victoria professor and climate change expert, defeated four-term Liberal cabinet minister Ida Chong in the Vancouver Island riding of Oak Bay-Gordon Head on southern Vancouver Island.

\"It is very, very exciting,\" a tired, but elated Weaver said Wednesday.

But the reaction among environmental groups to the Green victory was tempered by the surprising loss of the B.C. New Democrats and their no-to-pipelines platform.

Harper Seeks to Build Keystone XL Support on U.S. Visit Prime Minister Stephen Harper is seeking to counter opposition to TransCanada Corp.?s Keystone XL pipeline, a project crucial for boosting Canada?s economy and Harper?s plans to make the country an energy superpower to rival Saudi Arabia.

Harper, at an event today moderated by former U.S. Treasury Secretary Robert Rubin for the Council on Foreign Relations in New York, said there is a strong case for the U.S. government to approve the pipeline, citing the prospects for job creation and North American energy independence.

Keystone XL pipeline \'needs to go ahead,\' Harper tells U.S. Prime Minister Stephen Harper told an American audience today that the Keystone XL pipeline \"absolutely needs to go ahead.\"

Harper made the pipeline pitch while taking questions at the Council on Foreign Relations in New York City.

Fracking on Federal Lands Said to Get Scaled-Back Rule Proposal Gas drillers using hydraulic fracturing on federal lands would be able to use an industry-sponsored website to disclose the chemicals they use and won?t need to perform cement tests on each well, according to a revised proposal from the Interior Department set for release today.

Drillers will be permitted to use a variety of methods to test the integrity of their wells, according to a fact sheet from the Interior Department, which was provided to Bloomberg by an outside representative.

Edison, Mitsubishi hit roadblock on San Onofre\'s future A flurry of letters that went back and forth between Southern California Edison and Mitsubishi Heavy Industries late last year reveal the serious hurdles that stand in the way of the San Onofre nuclear power plant\'s long-term future.

The plant had been offline at that point for nearly a year because of unusual wear on tubes that carry radioactive water in the plant?s newly replaced steam generators, which were designed and manufactured by Mitsubishi.

Teenager Designs Safer Nuclear Power Plants Do nuclear power plants need a redesign? Critics of nuclear energy seem to think so, and so does nuclear energy advocate, Taylor Wilson. A physics wunderkind, Wilson became the youngest person to ever create fusion at age 14. And since graduating from high school last year, he\'s devoted himself to finding innovative solutions to the world\'s biggest problems.

The now nineteen-year-old Wilson recently spoke to a TED audience about his design for a small, modular fission reactor that is both less expensive and much safer to operate than today\'s nuclear reactors.

Can an abandoned warehouse transform Ivy City? A streetcar may be a longshot, and Lewis and Swanson are both skeptical that it?d help Ivy City residents. But up to now, the neighborhood has been taunted by transit it doesn?t benefit from: the Amtrak tracks that box in a neighborhood that lacks easy access to any Metro or intercity rail stations, and the whizzing cars along New York Avenue that rarely have occasion to pull off in Ivy City. Adding destination retail, a community-serving supermarket, greater transportation options, and jobs in the office building?Jemal says there could be up to 5,000 people working there?could change all that. Tregoning says the kind of retail the Hecht?s project might be able to attract would ?allow that community to punch above its weight.? And Millstein hopes that it could motivate the city to find other locations for bus and truck parking as those Ivy City lots become more valuable as potential retail or housing development sites.

As auto sales rebound, so do repossessions An increase in auto repossessions due to borrowers defaulting on their car loans is raising new questions about whether the auto industry is going too far selling new cars and trucks to those with subprime credit records.

According to Experian Automotive, the percentage of auto repos in the first quarter jumped 16.9 percent, and the average charge-off for bad loans jumped more than $600 to $7,401.

Tesla to Raise More Than $1 Billion to Repay U.S. Loan Tesla Motors Inc., the electric-car maker run by Elon Musk, will use proceeds from a sale of shares and debt to repay its U.S. loan as much as nine years ahead of schedule, a victory for a maligned Energy Department program.

Tesla Motors As The 4th U.S. Automaker, And Why The Future Is Bright Tesla Motors has been a fairly controversial stock ever since its 2010 IPO, as its critics and supporters argue over Tesla\'s profit potential, its relevance, and even the utility of its cars. For Tesla\'s critics, what is effectively Elon Musk\'s most famous venture is little more than a pipe dream, a futile exercise in unworkable technology financed by taxpayers. And to Tesla\'s supporters, the company represents a paradigm shift in the automobile business, and they believe that the company will emerge as America\'s 4th automaker, alongside the \"Big 3\" of Detroit. With Tesla\'s Q1 2013 results on May 8, we believe that Tesla will indeed take its place as America\'s 4th automobile manufacturer. Tesla has created a recipe for success in the automobile market of today, as well as the automobile market of tomorrow, with clear strategies for both.

A reality check on Tesla Even after overlooking all the Model S\' objective blemishes (the team over at CR mentioned its lack of certain high-end features, stereo issues and parasitic battery energy losses when parked), electric vehicles lack a national infrastructure of charging points, accessible cross-country range and remain cost prohibitive for most consumers. These are major hurdles, preventing tens of millions from even considering vehicles like the Model S. Don\'t feel sorry for just the electric crowd, either. The same hindrances are lodged at other alternative-energy vehicles, such as those powered by hydrogen and natural gas.

Tesla\'s high-scoring 85 kwh Model S, arguably at the top of its pure-electric segment, is limited to a range of about 265 miles. Even though it may be plugged into any common 110-volt electrical outlet for a slow charge, high-speed electric vehicle charging stations have only sprung up in major population centers or along busy highway corridors, meaning a lack of foresight before heading down a less-traveled road may initiate a tow truck encounter.

Used Fisker Karma EVs are the \'new Delorean\' as prices tumble As used car deals go, this is one to make you think twice. Used Fisker Karmas, which sold for $103,000 just a year ago as new models, are now being sold for roughly half price. In some cases, those trying to sell the luxury extended-range electric car on eBay cannot even get bids above $50,000.

World Bank\'s IFC agrees to support Masdar projects Masdar and the International Finance Corporation have penned an agreement that could see the World Bank subsidiary provide as much as US$1.5 billion in financing to the Abu Dhabi investor for clean energy projects around the world.

In a memorandum of understanding (MoU) announced yesterday and signed in Washington DC, the IFC and Masdar agreed to look at projects ranging from solar plants to carbon capture and storage facilities.

SolarCity shares surge on news of financing from Goldman NEW YORK (CNNMoney) - SolarCity shares are shining once again.

The solar-energy installer surged 9% Thursday after announcing an agreement with Goldman Sachs that will finance $500 million worth of solar projects. The deal, inked last year, has already supported 26 megawatts\' worth of new solar-generation power and will provide for 84 megawatts more, making it the largest agreement of its kind, SolarCity said.

Lithium Ion Starter Batteries: Will BYD Take The Place Of A123 Systems? This contribution is about \"Build your Dreams\" - BYD, Warren Buffett\'s most famous investment in China. It\'s aimed at analyzing this company\'s possibilities of success in the introduction of Li-ion starter batteries into the micro-hybrid car market.

China says EU solar duties to \"seriously harm\" trade ties BEIJING (Reuters) - China warned the European Union on Thursday that imposing duties on Chinese solar panels would \"seriously harm\" bilateral trade ties, upping the tone of its criticism a week after the EU said it would move ahead with hefty penalties in June.

The European Commission has agreed to impose average import duties of 47 percent on solar panels from China, according to officials, a move they say is to guard against the dumping of cheap goods in Europe.

A powerful use for spoiled food Kroger Co.\'s anaerobic digester in Compton takes unsold food from Ralphs and Food 4 Less and converts it into 13 million kilowatt-hours of electricity a year.

Indonesia: A Logging Ban Is Extended Indonesia has approved a two-year extension to a landmark ban on clearing primary rain forests and peatlands, an official said Thursday.

Senate Panel Advances Nominee for E.P.A. WASHINGTON ? A sharply divided Senate committee on Thursday approved the nomination of Gina McCarthy to serve as administrator of the Environmental Protection Agency.

The Environment and Public Works Committee voted to clear Ms. McCarthy by 10-to-8 along strictly partisan lines, sending the nomination to the Senate floor where Republicans are threatening to filibuster unless the E.P.A. meets demands for additional information.

Escape Plans Why do we need a space program? Because Earth isn?t going to be a safe place in the long term.

Planting the Seed of Sustainable Farming The key question is: How do we get enough farmers to practice sustainable agriculture so that algal blooms and dead zones ? whether in Lake Erie or the Gulf of Mexico ? become a thing of the past? How do we actually win?

The answer lies in convincing farmers that sustainable agriculture is not at odds with high yields and profitability. In fact, practices like more efficient use of fertilizer and the creation (or maintenance) of wetlands and buffer strips, which filter runoff before it can reach streams and rivers, can save farmers money and help improve the quality of their soil.

Food supply under assault as climate heats up American eaters, let?s talk about the birds and the bees: The U.S. food supply ? from chickens injected with arsenic to dying bee colonies ? is under unprecedented siege from a blitz of man-made hazards, meaning some of your favorite treats someday may vanish from your plate, experts say.

Warmer and moister air ringing much of the planet ? punctuated by droughts in other locales ? is threatening the prime ingredients in many daily meals, including the maple syrup on your morning pancakes and the salmon on your evening grill as well as the wine in your glass and the chocolate on your dessert tray, according to four recent studies.

Scientists: Climate change is real An overwhelming 97 percent of climatologists endorse the idea of human-caused global warming

As if the backing of NASA, 18 independent American scientific societies, and an intergovernmental panel established under the United Nations weren\'t enough to quell the protests popping up in comment sections across the Internet, a new study published in the journal Environmental Research Letters confirms ? once again ? that climatologists almost unanimously believe that climate change is directly related to human-made carbon emissions.

Analysis: Obama climate agenda faces Supreme Court reckoning WASHINGTON (Reuters) - With a barrage of legal briefs, a coalition of business groups and Republican-leaning states are taking their fight against Obama administration climate change regulations to the U.S. Supreme Court.

The U.S. Chamber of Commerce and other industry groups, along with states such as Texas and Virginia, have filed nine petitions in recent weeks asking the justices to review four U.S. Environmental Protection Agency regulations that are designed to cut greenhouse-gas emissions.

Africa: At UN Debate, Experts Weigh Clean Energy, Water Strategies to Halt \'Runaway\' Climate Change With dire warnings likely to match or exceed the worst fears about the effects of global warming, environment and development experts gathered today at United Nations Headquarters to debate the twin challenge of curbing climate change while sustaining economic growth.

\"The fundamental challenge of our time is to end extreme poverty in this generation and significantly narrow the global gap between rich and poor without ruing the environmental basis for our survival,\" General Assembly President Vuk Jeremic said as he opened the Thematic Debate Sustainable Development and Climate Change: Practical Solutions in the Energy-Water Nexus.

EU Should Scrap Energy Subsidies to Fight Warming, Poland Says The European Union should scrap fossil fuel and renewable energy subsidies and set a target to cut oil imports to remain the leader in the fight against global warming, according to Poland?s environment minister.

Poland wants to keep energy prices at an affordable level, Minister Marcin Korolec said today at a conference in Warsaw attended by EU Climate Commissioner Connie Hedegaard titled ?A World You Like With a Climate You Like.?

?We have our ideas of how to improve EU policies and thus climate,? Korolec said. ?Those are simple actions that would help us have the climate you like on a budget you like.?

Artist finds inspiration in Canadian government\'s attempt to silence her Banned on the Hill: A True Story about Dirty Oil and Government Censorship, released this week, shows how Canadian bureaucrats tried to silence James because her views on climate change clashed with the Harper government\'s push to develop Alberta\'s tar sands.

The story is told through visual essays as well as official emails obtained by James, in which government bureaucrats discuss the troublesome artist and her work.

It also relies heavily on humour ? some of it provided inadvertently by the government bureaucrats discussing what to do about James.

James Hansen Says Greenland Melt May Cool North Atlantic Greenland ice melting at an expanding pace may begin cooling the North Atlantic and increasing the severity of storms by 2075, said James Hansen, the former NASA scientist who raised concerns about global warming in the 1980s.

?If we stay on this path where the rate of mass loss from Greenland doubles every 10 years, we would get to a situation by about 2075 or 2080 where the mass loss is so fast that it causes the whole North Atlantic to be colder,? Hansen said in London.

Tar sands make climate change \'unsolvable\': Hansen Exploiting oil and gas trapped in tar sands and shale threatens to make climate change ?unsolvable,? said James Hansen, the former NASA scientist who raised concerns about global warming in the 1980s.

Conventional reserves of oil, gas and coal already have more carbon embedded in them than is safe to burn without causing ?dangerous? levels of warming beyond a rise of 2 degrees Celsius since industrialisation, Hansen told a U.K. panel of lawmakers today.

Leaked Papers Show UK Government Will Backtrack on Tar Sands Extraction Being Classified As Highly Polluting The UK government has come under fire this week from both NGOs and scientists for rejecting an EU proposal to classify tar sands under the European Fuel Quality Directive (FQD) as ?highly polluting? ? despite the fact research has shown that oil produced from the Canadian tar sands emits 3-4 times more greenhouse gases than does conventional oil.

E.U. Considers Emission Fines on Chinese and Indian Airlines BRUSSELS ? The European Commission said Thursday that Air China and Air India were among 10 Chinese and Indian airlines facing the prospect of fines and exclusion from airports in the European Union for refusing to comply with rules aimed at regulating greenhouse emissions.

The carriers are accused of not providing emissions data, as required by the European rules, and not participating in a permit system that entitles airlines to emit greenhouse gases in European airspace.

America?s first climate refugees: Can a baked Alaska deny climate change? There is no disputing the real-time effects of climate change. Alaska is warming faster than anywhere else in America, setting off a circumpolar scramble for oil and other resources given up by the melting ice and threatening the livelihood of those who still live off the land and the sea.

?Up here in Alaska, I would say most people do not have an argument that climate change is happening because we see it,? said Douglas Causey, a wildlife biologist at the University of Alaska at Anchorage. ?The debate is not whether climate change is happening. The debate is over what?s causing it.?

But those debates, and the fierce politics surrounding climate change, compromise efforts to deal with the causes and protect the people who will bear a huge part of the consequences.

Glacier melt causes third of sea-level rise Water from the world\'s shrinking glaciers was responsible for almost a third of the rise in sea levels between 2003 and 2009, shows new research.

As North Pole Melts, U.S. Arctic Policy Needs to Heat Up Behind the Arctic?s intensifying geopolitics are some powerful geophysics. Climate change is causing Arctic ice to melt at an accelerating rate. Last summer, the area of ice covering the Arctic Ocean was about half what it was, on average, from 1980 to 2000. The thickness of the remaining ice had diminished by 80 percent over the same period. The late-summer Arctic could regularly be ice-free as soon as the 2030s, according to some estimates.

Although these developments portend ominous changes in the jet stream, ocean currents and global climate, they also promise great opportunities. With less ice will come more access to oil and gas: The U.S. Geological Survey estimated in 2008 that the region holds 30 percent of the world?s undiscovered natural gas reserves and 13 percent of its undiscovered oil.

Canada must rule its Arctic waves To declare and enforce our sovereignty in the huge archipelago we claim, an area the size of Western Europe, we must have ships and sailors in those waters in sufficient numbers, and with sufficient capability, to let no nation doubt our commitment. But even with the government?s highly-touted shipbuilding program, the worry is that our will shall fail, and the resources wither below what was promised. We may lose our voice around the Arctic Council table, with new members clamouring to join, to stronger, more robust nations, because of Nelson?s ?want of frigates? ? or their modern equivalent.

Half of oil burnable in 2000-2050 to keep us within 2 degrees warming has been used up as we hit 400 ppm This article shows CO2 emission profiles from oil, analyses how regional peak oil events shape emission curves and calculates that an annual 6% oil decline rate after 2012 would be needed to satisfy the boundary condition to keep global warming to 2 degrees C, with a 25% probability of exceeding this target. ', this, event, '150px')">Drumbeat: May 17, 2013 (8 days ago)
Oil Shockwaves From U.S. Shale Boom Seen by IEA Ousting OPEC The U.S. shale boom will send ?shockwaves? through the global oil trade over the next five years, benefiting the nation?s refiners and displacing OPEC as the driver of supply growth, the IEA said.

North America will provide 40 percent of new supplies to 2018 through the development of light, tight oil and oil sands, while the contribution from the Organization of Petroleum Exporting Countries will slip to 30 percent, according to the International Energy Agency. The IEA trimmed global fuel demand estimates for the next four years, and predicted that consumption in emerging economies may overtake developed nations this year.

?The supply shock created by a surge in North American oil production will be as transformative to the market over the next five years as was the rise of Chinese demand over the last 15,? the Paris-based adviser to 28 oil-consuming nations said in its medium-term market report today.

The IEA Says Peak Oil Is Dead. That?s Bad News for Climate Policy No one?aside maybe from survivalists who?d stocked up on MREs and assault rifles?was really looking forward to a peak-oil world. Read this 2007 GQ piece by Benjamin Kunkel?while we?re discussing topics from the mid-2000s?that imagines what a world without oil would really be like. Think uncomfortable and violent. Oil is in nearly every modern product we use, and it?s still what gets us from point A to point B?especially if you need to get from A to B in a plane. If we were really to see the global oil supply peak and decline sharply, even as demand continued to go up, well, apocalyptic might not be too large a word. And for several years in the middle of the last decade, as oil prices climbed past $100 a barrel and analysts were betting it would break $200, that scenario seemed entirely plausible.

But there was an upside to peak oil. Crude oil was responsible for a significant chunk of global carbon emissions, second only to coal. Only the shock of being severed from the main fuel of modernity would be enough to make us get serious about tackling climate change and shifting to an economy powered by renewable energy and efficiency. We?d have to because we?d have no other choice, save a future that might look something like Mad Max. We?d lose oil but save the world.

The World is Not Running Out of Oil ? but Europe Is Contrary to popular belief, peak oil alarmists and Greenpeace propaganda, the world is still and will continue to be for at least a century, largely powered by oil. And not just for transport. An endless number of consumer goods depend on a steady supply of petroleum products for their manufacture. As Marin Katusa, chief energy investment strategist for Casey Research points out, ?A country without oil simply cannot continue to expand or even be competitive on the world stage.? Katusa explains, most of Europe?s oil comes from the North Sea region. A source where production has dropped to less than half of what it was in 2002. Much of the rest of it comes from countries such as Libya, Saudi Arabia and Nigeria, all countries threatened by political instability and social unrest. Europe could, of course, push development of its own potential oil resources. Or they could if the ludicrously inept EU Energy Road Map wasn?t studded with anti-fossil fuel pot holes and renewable energy cul-de sacs that are deterring investors.

It Doesn\'t Matter If We Never Run Out of Oil: We Won\'t Want to Burn It Anymore Like whale oil in the 1860s, oil today has become uncompetitive -- even at low prices -- and that will only become truer with time.

No, Really: We\'re Going to Keep Burning Oil?and Lots of It No matter how much we wish it were otherwise, the economics favor burning fossil fuels.

Peak oil, climate change and pipeline geopolitics driving Syria conflict Syria\'s dash for gas has been spurred by its rapidly declining oil revenues, driven by the peak of its conventional oil production in 1996. Even before the war, the country\'s rate of oil production had plummeted by nearly half, from a peak of just under 610,000 barrels per day (bpd) to approximately 385,000 bpd in 2010.

Since the war, production has dropped further still, once again by about half, as the rebels have taken control of key oil producing areas.

Faced with dwindling profits from oil exports and a fiscal deficit, the government was forced to slash fuel subsidies in May 2008 - which at the time consumed 15% of GDP. The price of petrol tripled overnight, fueling pressure on food prices.

The crunch came in the context of an intensifying and increasingly regular drought cycle linked to climate change. Between 2002 and 2008, the country\'s total water resources dropped by half through both overuse and waste.

China Seen Boosting Emergency Oil-Storage Capacity, IEA Says China will probably commission additional storage sites for its strategic petroleum reserve this year, boosting crude demand even as construction work on the program takes longer than expected, according to the International Energy Agency.

The nation, the world?s second-biggest crude consumer, will add 245 million barrels of capacity in the second phase of its emergency stockpile plan, the Paris-based IEA said in its Medium-Term Oil Market Report released today. That?s up 45 percent from the IEA?s original estimate of 169 million barrels. Completion may be delayed to 2015, according to the agency, which originally forecast the project would be finished by the end of this year.

Shell Targeted With BP in EU Price Fixing Probe for Oil Three of Europe?s biggest oil explorers are among companies being questioned by European antitrust regulators about potential manipulation of prices in the $3.4 trillion-a-year global crude market.

EU Oil Manipulation Probe Shines Light on Platts Pricing Window Two weeks after Royal Dutch Shell Plc and Platts changed the way more than half of the world?s crude is valued, the companies along with BP Plc and Statoil ASA are being probed by European antitrust regulators about potential manipulation of oil prices.

The investigation by the European Commission shines a light on how price reporting companies including Platts, the energy news and data provider owned by McGraw Hill Financial Inc., help determine the cost of raw materials used in everything from plastic bags to jet fuel. The suspected violations are related to the Platts? Market-On-Close assessment process, or so-called window, and may have been ongoing since 2002, Statoil said.

Britain urges oil firms to comply with probe LONDON (Reuters) - Britain expects oil firms to fully comply with a European Commission\'s probe into energy pricing and would be deeply concerned if prices have been driven up, a spokesman for Prime Minister David Cameron said on Wednesday.

WTI Crude Near Two-Week Low; Europe Probes Oil Pricing West Texas Intermediate crude fell for a fifth day in its longest run of declines since December. Antitrust regulators are questioning European oil companies about possible manipulation of prices.

Futures traded near their lowest closing level in almost two weeks in New York. Crude inventories gained 1.1 million barrels last week, the industry-funded American Petroleum Institute said yesterday. A government report today may show stockpiles climbed 450,000 barrels, according to a Bloomberg survey. Royal Dutch Shell Plc, BP Plc, Statoil ASA and Platts said they?re being investigated after the European Commission conducted raids on their offices in three countries.

?The world will remain well-supplied,? said Andrey Kryuchenkov, an analyst at VTB Capital in London. ?Higher prices lately have triggered a boost to capacity that will continue to outpace slack post-crisis demand growth.?

Nebraska could see another spike in gas prices Drivers in the Plains states, including those in Nebraska, could be paying another 10 to 20 cents a gallon for gasoline in the next few days, and that\'s on top of the 15- to 20-cent increases of the past week, according to industry analysts at GasBuddy.com

?Most states have seen increases over the past week, and the national retail average reflects that with a 6-cent-per-gallon increase, but clearly, these states have gotten the brunt of it,? said Patrick DeHaan, senior petroleum analyst, GasBuddy. He was referring to North Dakota (up $0.19 per gallon over the past week), Kansas ($0.17), Nebraska ($0.16), Iowa ($0.15), Oklahoma ($0.14), South Dakota ($0.13) and Minnesota ($0.12).

Ex-Goldman Trader Saiz?s Fund Assets Drop 86% Following Loss Vector Commodity Management LLP?s assets under management slumped 86 percent this year after losing money since 2011.

The energy hedge fund run by former Goldman Sachs Group Inc. trader Gilbert Saiz managed $43 million by the end of April, according to a letter to investors obtained by Bloomberg News. Its December statement showed assets of $318 million. Vector?s trading of mainly crude and oil products resulted in a 4.9 percent loss from January through April, the letter showed. A Vector executive in London, who asked not to be named in line with company policy, declined to comment by phone today.

Pertamina embarks on shale gas exploration Indonesia?s biggest energy firm, PT Pertamina, will tap into shale gas exploration this year in the state-controlled company?s bid to discover unconventional natural gas amid dwindling crude oil production.

Pertamina CEO Galaila Karen Agustiawan signed the production-sharing contract of the Sumbagut block in North Sumatra during the inauguration of the of the 37th Indonesian Petroleum Association (IPA) convention in Jakarta on Wednesday.

Brazil Oil Auction Gathers Drillers With Taste of Africa More than 60 oil companies are set to bid on exploration permits offshore Brazil, taking on risks of drilling in virgin waters after similar geology across the Atlantic in Ghana and Ivory Coast yielded major discoveries.

Contestants in Brazil?s first oil auction in five years range from Exxon Mobil Corp. and Chevron Corp., the largest U.S. producers by market value, to Brazilian startup Ouro Preto Oleo & Gas, a government registry shows. They?re betting that deep-water deposits off the northern coast hold reserves like those found thousands of miles across the ocean in Africa?s Gulf of Guinea. The two-day sale, estimated to generate as much as $5 billion for the government, started today in Rio de Janeiro.

Russia Seeks $2 Billion Gain With Oil Extraction Tax Increase Russia?s Finance Ministry is seeking to raise $2 billion by raising taxes on crude output as the world?s largest oil-producing nation seeks to boost budget revenue, according to a plan presented to government officials.

A higher mineral extraction tax rate will be partly offset by a decrease in export duties, according to the document. The budget?s gain is based on an average oil price of $100 a barrel.

Anadarko?s Walker Named Chairman as Hackett?s Reign Ends Hackett remade Anadarko through deep-water exploration projects in Africa and the Gulf of Mexico and more than $21 billion in acquisitions. Analysts are looking for Walker, 56, to extract more value from the oil and natural gas assets Hackett assembled, while helping the company move beyond an environmental lawsuit and its association with BP Plc?s 2010 Macondo oil spill in the Gulf of Mexico.

Greece to break up state-owned power company by 2016 ATHENS -- Greece\'s conservative-led government has announced plans to break up the state-run Public Power Corporation by 2016, as part of a privatization program demanded by the crisis-hit country\'s creditors.

Taiwan to sanction Philippines, send naval ships in fishing spat TAIPEI (Reuters) - Taiwan on Wednesday recalled its envoy to the Philippines, froze applications for work permits and ordered military exercises in waters between the two sides to press its demand for an apology for the shooting death of a Taiwanese fisherman.

Andrew Weaver makes history in BC, becomes first Green in provincial legislature Andrew Weaver ? a University of Victoria climate scientist ? has won his seat in the Vancouver Island riding of Oak Bay-Gordon Head becoming the first Green Party candidate elected to a provincial legislature in all of Canada.

B.C. vote shifted on one word: Pipelines The NDP looked way ahead before voters went to the polls in British Columbia. Then it all changed. Why? One word: ?Pipelines.? Or more precisely, two: ?Kinder Morgan.?

Until two weeks ago it was the election of the NDP?s Adrian Dix to lose. Then he got greedy. Worried about an emerging Green threat, Mr. Dix sought to pre-empt the party by going greenier-than-thou, specifically by promising to ban significantly greater tanker traffic out of the port of Vancouver, which would doom the export of Alberta oil to the Pacific. This was a stunning turnabout on a clear promise to withhold judgement until the pipeline application had been filed with details made available.

His gamble failed and, more importantly for the future of the NDP, the Greens elected their first MLA. This will split the vote on the left for years to come.

Ex-BP Engineer Says U.S. Withheld Evidence in Spill Case A former BP Plc (BP/) engineer charged in the first criminal case arising from the 2010 Gulf of Mexico oil spill said U.S. prosecutors withheld evidence that might clear him and urged a judge to sanction them.

Why natural gas exports would benefit clean energy The renewable energy industry would benefit from higher natural gas prices--and higher coal prices, for that matter--since, as these fuels for electric power plants become dearer, renewable energy sources become more competitive. The costs for renewables are in the production and installation of the solar panels, wind towers and dams; the fuels--sunlight, wind, and water--are essentially free.

Fuel-Cell cars set to gain momentum in US, but will consumers want to pay for the vehicles? Considered by many to be more efficient than even electric vehicles, fuel cells aren?t limited by the dynamics of thermodynamics, notes NextGreenCar, which enables them to achieve higher conversion efficiencies than conventional engines that only make use of 20 percent-25 percent of the fuel?s energy (as in gas-powered cars) ? fuel cells can achieve up to 60 percent.

M-B-Hydrogen-FCVHowever, unlike a battery the reactants ? fuel and oxygen ? have to be continually supplied for an electric current to be produced.

Fuel cell vehicles have been known to have a driving range of up to 240 miles or more.

North Carolina May Ban Tesla Sales To Prevent ?Unfair Competition? From the state that brought you the nation?s first ban on climate science comes another legislative gem: a bill that would prohibit automakers from selling their cars in the state.

The proposal, which the Raleigh News & Observer reports was unanimously approved by the state?s Senate Commerce Committee on Thursday, would apply to all car manufacturers, but the intended target is clear. It?s aimed at Tesla, the only U.S. automaker whose business model relies on selling cars directly to consumers, rather than through a network of third-party dealerships.

Petrobras Besting Sugar Mills in Ethanol Boom Petroleo Brasileiro SA, the state-run oil producer, stands to profit the most from Brazilian measures to boost ethanol output as rising biofuel supplies reduce the need to sell imported gasoline at a loss.

', this, event, '150px')">Drumbeat: May 15, 2013 (10 days ago)
Old Technology Fuels New Energy Boom What?s happening today is not a new-technology revolution; it?s an evolution of new applications for existing technology. Oil companies are doing things that they?ve been doing for decades more efficiently, more effectively, and in much wider applications.

That may sound like a fine distinction, but it?s an important one: Silicon Valley has for years invested in sexy new technologies, from smartphones to social media to exotic solar power materials. The cleantech industry itself has not benefited from a fascination with the new, the exotic, and the high-tech. The technology for embedding sensors with fiber-optic connections in a drill head so that technicians on the surface can map a formation as they drill it is not all that sexy, and it didn?t come from a VC-funded startup in a Mountain View garage. It came from drilling engineers in the field figuring out, gradually, how to do things better, cheaper, and smarter. Often, as in the case of the 21st century oil and gas boom, imaginative tinkering can be more fruitful than reinvention or laboratory R&D.

WTI Drops a Third Day; OPEC Output at Five-Month High West Texas Intermediate crude fell for a third day, the longest run of declines in four weeks, as OPEC boosted output to the highest level in five months.

WTI futures slid as much as 1.2 percent in New York, and London-traded Brent decreased for a second day. The Organization of Petroleum Exporting Countries produced 30.46 million barrels a day last month, up from 30.18 million in March, the group?s secretariat said May 10. That?s the most since November. Morgan Stanley predicted that the spread between WTI and Brent will widen as U.S. supplies accumulate.

Singapore bunker fuel sales rise 8.5 pct in April on lower prices The outright price for the Singapore marine fuels benchmark 380-centistoke (cst) between April 1 and 18 fell $42.50 a tonne to $592.50 a tonne, which was also the lowest price for the month, Reuters data showed.

This drop was triggered by a plunge in global crude oil benchmarks in April, following a slew of negative economic data from the world\'s largest oil consumers, the United States and China. Brent crude was down nearly 7 percent on the month, while U.S. oil was 3.9 percent lower.

Iran says $100 per barrel is \'fair\' price for oil TEHRAN, Iran (AP) -- Iran\'s oil minister says the country supports prices of $100 for a barrel of crude.

A Monday report by the ministry website quotes Rostam Ghasemi as saying, \"For the price of crude to remain at about $100 is fair, and Iran supports it.\"

China Oil Refining Falls to Eight-Month Low; Power Output Gains China?s crude processing fell to the lowest level in eight months in April as refineries shut units for maintenance and industrial production expanded at a slower pace than forecast. Electricity output increased.

Refining in the world?s second-largest oil consumer dropped to 9.36 million barrels a day last month, according to data published today on the website of the Beijing-based National Bureau of Statistics. That?s the lowest since August and 8 percent below December?s record.

Chinese Sneeze Startles OPEC China has been the driving force behind oil-demand growth since 2008, when much of the rest of the world stalled.

Now OPEC has added its voice to the debate, warning that weaker-than-expected economic growth in China may dent oil consumption. OPEC may well be concerned?Saudi Arabia, the cartel?s kingpin, is the No. 1 supplier of oil to China and the Middle East represents some 40% of Chinese oil imports, according to the Saudi Gazette.

China\'s debt: a crisis in the making? HONG KONG (CNNMoney) The world\'s second largest economy has a debt problem.

China\'s credit boom has saddled unworthy businesses with large loans, fueled the country\'s shadow banking system and put local governments on the hook for billions.

Swiss bank UBS calculates that central government debt was equal to 15% of the economy at the end of 2012. That number spikes to 55% when debt racked up by local governments and agencies is included.

If corporate and household debt is also counted, China\'s total debt load balloons to more than 200% of gross domestic product.

Indonesia to Seek Higher Price From China for LNG Indonesia will send a delegation to China later this month to seek a higher price for its liquefied natural gas, the head of oil and gas upstream watchdog SKK Migas said Monday.

Kazakhstan and Turkmenistan Launch Caspian Rail Link Turkmenistan and Kazakhstan have launched a direct railway linking their oil-and-gas-rich Caspian Sea regions, bypassing Uzbekistan. The new line promises to benefit \"tens of countries\" in the region, opening the remote areas to major markets, says Kazakh President Nursultan Nazarbayev.

Mexico sees oil and gas theft upsurge in 2013 Hydrocarbon theft in Mexico so far this year has nearly doubled in comparison with 2012, with the worst hit zones corresponding to some of Mexico\'s drug war hotspots.

Oil Minister: Iran Plans New Petrochemical Hubs TEHRAN (FNA)- Iranian Oil Minister Rostam Qassemi lauded the eye-catching growth of Iran\'s petrochemical industry, and said that new petrochemical hubs will be created in the country.

British Columbia Vote Risks Oil-Sands Exports British Columbia?s provincial election threatens to stymie efforts by Canadian Natural Resources Ltd. (CNQ) and other Alberta oil-sands companies to sell crude to Pacific markets.

Transocean Chairman Talbert to Step Down Amid Fight With Icahn Transocean Ltd., the world?s largest offshore oil rig contractor, said Chairman Michael Talbert plans to step down as the company fights board nominees from billionaire investor Carl Icahn.

Chesapeake Ruling Shocks With $117 Million Loss: Credit Markets Last week?s court ruling against a group of Chesapeake Energy Corp. bondholders exposes another risk for investors seeking gains in a market where securities valuations are already at record highs.

Prices on the second-biggest U.S. natural gas producer?s notes have fallen by as much as 9 cents on the dollar, erasing $117 million, after a judge ruled May 8 that Chesapeake could redeem the securities at par. Investors including the hedge-fund firm run by former Lehman Brothers Holdings Inc. President Bart McDade were betting the Oklahoma City-based company had missed a deadline and would have to pay as much as $400 million to retire the debt early.

Our Enron-style justice system There is Too Big to Jail ? and now there is Too Big to Keep In Jail.

This is the envelope-pushing precedent being set by the Justice Department in its dealings with convicted Enron executive Jeffrey Skilling ? a.k.a. one of the hucksters whose rip-off schemes were responsible for, among other things, losing more than $2 billion of retirees? pension funds.

Is Canada?s Oil Too Dirty for Europe? As the debate over the construction of the Keystone XL pipeline continues in the United States, a Canadian trade delegation is insisting that Canadian oil extracted from tar sands ? the product that would be transported by an expanded pipeline ? should not be classified as being dirtier than other types of oil.

Last week Canada?s natural resource minster, Joe Oliver, threatened to take the European Union to the World Trade Organization over its plans to classify oil harvested from tar sands as ?highly polluting.?

Cameron Says Oil, Mineral Companies Need Improved Transparency U.K. Prime Minister David Cameron set his sights on oil, gas and mining companies in his drive for greater corporate and government transparency ahead of the summit of G-8 industrialized nations next month.

Cameron, who will chair the summit in Northern Ireland in June, singled out the sector as he outlined his plans to forge an international deal to tackle tax evasion and avoidance and increase the openness of corporations.

Canadian oil company threatens the survival of Peru?s ?Jaguar people? The Yaquerana River in the Amazon rainforest marks the border between Peru and Brazil, but to the Mats', this, event, '150px')">Drumbeat: May 13, 2013 (12 days ago)


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ZeroHedge

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Like so many debacles in the EU, it started with the unelected European Commission. It’s immune to voters, but not to lobbyists and corporations. Under the guise of “consumer protection” or “food safety” or some other harmless moniker, it generates zany laws that tend to benefit large corporations. But last week, it went too far, even for Europeans – not that they don’t already have enough crises on their hands. It passed a law that banned restaurants from serving olive oil in refillable containers, such as cruets or dipping bowls.

On January 1, 2014, their use would become illegal. Instead, olive oil would have to be served in a one-use-only bottle, labeled in accordance with EU standards, and equipped with a tamper-proof “hygienic” spout. A restaurant owner in Germany, for example, who buys his special olive oil from an artisan producer in Southern France, would be out of luck; that small producer wouldn’t be able to comply with the costly stipulations. The restaurant would have to switch to an industrial supplier that can ship the special restaurant bottles with their tamper-proof spout and EU label. The small producer would be cut out.

The Commission’s decision was made under a Eurocrat procedure, called comitology – though it sounds like it, I’m not making this up! It allows for legislation that is binding for all 27 Member States to be passed into law automatically, without majority support from those Member States.

Exactly! The evil that this new law was supposed to cure: olive oil fraud. Admittedly, it’s a big issue in Europe, in the US, and elsewhere, and some of the largest industrial brands, such as Bertolli, have gotten caught with their pants down. But this law wasn’t going after fraud at the corporate level. On the contrary. It was passed under heavy lobbying from corporate producers.

The law targeted restaurateurs trying to make their own decisions about olive oil. Ostensibly it aimed to protect consumers and their taste buds from cruets or dipping bowls that had been refilled with low-quality or adulterated olive oil ... the kind maybe that big brands like Bertolli and others were sued for selling in California. But when asked if they’d seen any evidence of adulterated olive oil on restaurant tables, an official told the Daily Telegraph, “We don’t have any evidence; it is anecdotal and that was enough for the committee.”

The decision exemplified what’s wrong with EU governance. But there were other issues with the harebrained law. It would create a cesspool of bureaucracy and mountains of additional trash, including the small one-use-only tamper-proof bottles with their spouts, boxes, and containers. And more oil would be wasted as the bottles – much like Ketchup bottles – would be designed to make it impossible to get all the oil out of them.

But this time, the Commission and its process of comitology were greeted with an outburst of loathing and mockery. Criticism was “universal and came from consumers and restaurant owners in all EU countries,” an EU official told the Telegraph. And it came from the very top. “This is exactly the sort of thing that Europe shouldn’t even be discussing,” explained UK Prime Minster David Cameron, with an eye on the real problems that are currently dogging Europe. “It shouldn’t even be on the table, to force a pun – so to speak,” he said. And Dutch Prime Minister Mark Rutte told his parliament, “I think it is too bizarre for words and incomprehensible to come with this sort of proposal at a time like this.”

European Commission President Jos', this, event, '150px')">Government by Eurocrats: The Olive-Oil Dispenser Debacle (40 mins ago)
for only two years, urgently settling what little contracts were outstanding, many questions were left unanswered.

Such as: how it was possible that the exchange, expected by many to become the new preferred trading venue for Asian precious metals and to steal the CME\'s crown, could close on such short notice, without barely having been given a fair chance at being profitable, let alone dominating Pacific rim metals trading.

This mystery deepened further after reports that the exchange barely had seen any volume, with allegedly only a tiny 200 open contracts remaining to be settled upon shuttering.

Now, the confusion surrounding the HKMex closure has taken another big step for bizarrokind following news that not only have at least four HKMex senior executive have been arrested having been found to be in possession of false bank docs for nearly half a billion in dollars, but that government itself was forced to \"shore up confidence\" in CY Leung, Hong Kong\'s 3rd Chief Executive, whose former top aide was none other Barry Cheung Chun-yuen, founder of the HKMex.

Yet another major geopolitical scandal centered around gold: how original.

From the South China Morning Post:

Three mainland men charged in a scandal over the failed Hong Kong Mercantile Exchange (HKMEx) were found in their hotel rooms with false bank documents purporting to be worth hundreds of millions of dollars, a court heard yesterday.

 

Dai Linyi, 65; Li Shanrong, 49, and Lian Chunyan, 50, who were arrested on Tuesday, appeared in Kowloon City Court charged with \"possessing false instruments with intent\".

 

The men were detained after the Securities and Futures Commission found serious irregularities with the finances of the exchange - chaired by executive councillor Barry Cheung Chun-yuen - and handed the details of its inquiry to the police.

Specifically, among the confiscated false documents were an acknowledgment letter, two letters of guarantee and three proofs of funds allegedly issued by HSBC and Standard Chartered Bank. There were also time deposits and at least one telegraphic transfer. \"The acknowledgement letter, which was found among Dai\'s papers, was dated April 23 and allegedly issued by Standard Chartered in relation to a cheque for US$460 million (HK$3.57 billion). He also had a letter of guarantee from the same bank undertaking to pay US$460 million to a Zhang Jisheng.\"

Just as \"surprising\" is that HSBC is involved in another potential money-laundering scheme:

Dai also had a proof of funds dated May 8 and allegedly issued by HSBC confirming that US$11 million had been deposited into an account held by Lian. Both Li and Lian also held two other such \"proofs\" with the same descriptions. In addition, Dai and Lian had two documents dated May 7 proving the existence of two separate deposits of US$11 million each in another account held by Lian, the court heard.

However that is just the beginning:the scandal over the failed exchange threatens to go to the very top of Hong Kong\'s political ladder, following Friday\'s resignation of HKMEx founder Barry Cheung Chun-yuen, from all his public duties - including executive councillor and head of the Urban Renewal Authority - on Friday and is himself under police investigation over the collapse, the government has said.

The probe into the collapse of the Hong Kong Mercantile Exchange has widened, with police questioning three senior executives of the failed commodities agency.

 

Separate sources confirmed yesterday that detectives from the commercial crime bureau had talked to a total of four staff from the exchange.

Where things get truly bizarre is the news that the head of Hong Kong itself and the founder of the HKMEx were very close.

The probe into the collapse of the Hong Kong Mercantile Exchange has widened, with police questioning three senior executives of the failed commodities agency.

 

Separate sources confirmed yesterday that detectives from the commercial crime bureau had talked to a total of four staff from the exchange.

 

Meanwhile, government officials moved to shore up confidence in Leung Chun-ying\'s administration amid the growing controversy surrounding HKMEx founder Barry Cheung Chun-yuen, who was formerly his top aide.

 

Cheung resigned from all his public duties - including executive councillor and head of the Urban Renewal Authority - on Friday and is himself under police investigation over the collapse, the government has said.

 

Speaking to the Sunday Morning Post yesterday, Cheung, 54, would say only: \"Sorry, I am not taking calls today. I am at home with friends and family.\"

How long before there is a connection between Cheung and Hong Kong\'s top man CY Leung? Probably not very.

In the meantime, we don\'t hold much hope for the resurrection of the now shuttered mercantile exchange:

Meanwhile, Ben Kwong Man-bun, one of the 37 broker members of the HKMEx, said the exchange\'s business model would make it difficult for any would-be investor, or \"white knight\", to consider rebuilding the exchange.

 

\"If you look at the exchange\'s record, not too many members were actively using the platform,\" he said. \"[The exchange] needs a lot of capital and infrastructure.\"

So... what was the HKMEx being used for? Well, one explanation is that it was nothing more than a highly structured gold financing vehicle?

Huh?

Recall our lengthy article about China\'s Copper Financing Deals, and how China is cracking down on the practice: something which will likely unencumber 500,000 tons of copper as Letter of Credit collateral, and force its market liquidation, further crushing the spot price.

The opposite process can also be just as true: while in China copper has long been the preferred financing-creation asset of choice, in Hong Kong it may well have been gold. Which ostensibly would make the previously discussed CCFDs convert into HKGFDs.

And with the recent collapse in the price of paper gold, suddenly the infinite rehypothection chain that whatever gold was at the HKMEx was used for, found itself in jeopardy, with margin funding pressure forcing collateral chains to break, as counterparties suddenly demanded excess margin on existing arrangements.

The subsequent escalation in the serial failure of assorted \"HKGF\" deals may have been the ultimate reason why suddenly not only the very exchange - which may have been nothing than a glorified bonded warehouse for tons of LC collateral - was forced to promptly shutdown, but all those associated with it had to scramble to procure fake financial documents on short notice to avoid someone else\'s wrath, while the found a way to ride into the sunset.

Naturally, all of the above is still speculation, and much can change in the coming hours and days as more information is disclosed, however, if indeed this is a scandal about (multiple times) encumbered gold, if it reaches the very top of HK\'s power structure, one can be assured that there will be some very angry counterparties on the losing side of whatever gold-financing deals Hong Kong\'s top politicians had engaged in over the past two yeas.

    ', this, event, '150px')">Mystery Surrounding Collapse Of Hong Kong Mercantile Exchange Deepens; Four Arrested (38 mins ago)
The American Conservative,

In mid-March, the Wall Street Journal carried a long discussion of the origins of the Bretton Woods system, the international financial framework that governed the Western world for decades after World War II. A photo showed the two individuals who negotiated that agreement. Britain was represented by John Maynard Keynes, a towering economic figure of that era. America?s representative was Harry Dexter White, assistant secretary of the Treasury and long a central architect of American economic policy, given that his nominal superior, Secretary Henry Morgenthau Jr., was a gentleman farmer with no background in finance. White was also a Communist agent.

Such a situation was hardly unique in American government during the 1930s and 1940s. For example, when a dying Franklin Roosevelt negotiated the outlines of postwar Europe with Joseph Stalin at the 1945 Yalta summit, one of his important advisors was Alger Hiss, a State Department official whose primary loyalty was to the Soviet side. Over the last 20 years, John Earl Haynes, Harvey Klehr, and other scholars have conclusively established that many dozens or even hundreds of Soviet agents once honeycombed the key policy staffs and nuclear research facilities of our federal government, constituting a total presence perhaps approaching the scale suggested by Sen. Joseph McCarthy, whose often unsubstantiated charges tended to damage the credibility of his position.

The Cold War ended over two decades ago and Communism has been relegated to merely an unpleasant chapter in the history books, so today these facts are hardly much disputed. For example, liberal Washington Post blogger Ezra Klein matter-of-factly referred to White as a ?Soviet spy? in the title of his column on our postwar financial system. But during the actual period when America?s government was heavily influenced by Communist agents, such accusations were widely denounced as ?Red-baiting? or ridiculed as right-wing conspiracy paranoia by many of our most influential journalists and publications. In 1982 liberal icon Susan Sontag ruefully acknowledged that for decades the subscribers to the lowbrow Readers Digest had received a more realistic view of the world than those who drew their knowledge from the elite liberal publications favored by her fellow intellectuals. I myself came of age near the end of the Cold War and always vaguely assumed that such lurid tales of espionage were wildly exaggerated. I was wrong.

The notion of the American government being infiltrated and substantially controlled by agents of a foreign power has been the stuff of endless Hollywood movies and television shows, but for various reasons such popular channels have never been employed to bring the true-life historical example to wide attention. I doubt if even one American in a hundred today is familiar with the name ?Harry Dexter White? or dozens of similar agents.

The realization that the world is often quite different from what is presented in our leading newspapers and magazines is not an easy conclusion for most educated Americans to accept, or at least that was true in my own case. For decades, I have closely read the New York Times, the Wall Street Journal, and one or two other major newspapers every morning, supplemented by a wide variety of weekly or monthly opinion magazines. Their biases in certain areas had always been apparent to me. But I felt confident that by comparing and contrasting the claims of these different publications and applying some common sense, I could obtain a reasonably accurate version of reality. I was mistaken.

Aside from the evidence of our own senses, almost everything we know about the past or the news of today comes from bits of ink on paper or colored pixels on a screen, and fortunately over the last decade or two the growth of the Internet has vastly widened the range of information available to us in that latter category. Even if the overwhelming majority of the unorthodox claims provided by such non-traditional web-based sources is incorrect, at least there now exists the possibility of extracting vital nuggets of truth from vast mountains of falsehood. Certainly the events of the past dozen years have forced me to completely recalibrate my own reality-detection apparatus.

Thoughtful individuals of all backgrounds have undergone a similar crisis of confidence during this same period. Just a few months after 9/11 New York Times columnist Paul Krugman argued that the sudden financial collapse of the Enron Corporation represented a greater shock to the American system than the terrorist attacks themselves, and although he was widely denounced for making such an ?unpatriotic? claim, I believe his case was strong. Although the name ?Enron? has largely vanished from our memory, for years it had ranked as one of America?s most successful and admired companies, glowingly profiled on the covers of our leading business magazines, and drawing luminaries such as Krugman himself to its advisory board; Enron Chairman Kenneth Lay had been a top contender for Treasury secretary in President George W. Bush?s administration. Then in the blink of an eye, the entire company was revealed to be an accounting fraud from top to bottom, collapsing into a $63 billion bankruptcy, the largest in American history. Other companies of comparable or even greater size such as WorldCom, Tyco, Adelphia, and Global Crossing soon vanished for similar reasons.

Part of Krugman?s argument was that while the terrorist attacks had been of an entirely unprecedented nature and scale, our entire system of financial regulation, accounting, and business journalism was designed to prevent exactly the sort of frauds that brought down those huge companies. When a system fails so dramatically at its core mission, we must wonder which of our other assumptions are incorrect.

Just a few years later, we saw an even more sweeping near-collapse of our entire financial system, with giant institutions such as Fannie Mae, Freddie Mac, Bear Stearns, Lehman Brothers, Wachovia, and AIG falling into bankruptcy, and all our remaining major banks surviving only due to the trillions of dollars in government bailouts and loan guarantees they received. Once again, all our media and regulatory organs had failed to anticipate this disaster.

Or take the remarkable case of Bernie Madoff. His colossal investment swindle had been growing unchecked for over three decades under the very noses of our leading financial journalists and regulators in New York City, ultimately reaching the sum of $65 billion in mostly fictional assets. His claimed returns had been implausibly steady and consistent year after year, market crashes or not. None of his supposed trading actually occurred. His only auditing was by a tiny storefront firm. Angry competitors had spent years warning the SEC and journalists that his alleged investment strategy was mathematically impossible and that he was obviously running a Ponzi scheme. Yet despite all these indicators, officials did nothing and refused to close down such a transparent swindle, while the media almost entirely failed to report these suspicions.

In many respects, the non-detection of these business frauds is far more alarming than failure to uncover governmental malfeasance. Politics is a partisan team sport, and it is easy to imagine Democrats or Republicans closing ranks and protecting their own, despite damage to society. Furthermore, success or failure in public policies is often ambiguous and subject to propagandistic spin. But investors in a fraudulent company lose their money and therefore have an enormous incentive to detect those risks, with the same being true for business journalists. If the media cannot be trusted to catch and report simple financial misconduct, its reliability on more politically charged matters will surely be lower.

The circumstances surrounding our Iraq War demonstrate this, certainly ranking it among the strangest military conflicts of modern times. The 2001 attacks in America were quickly ascribed to the radical Islamists of al-Qaeda, whose bitterest enemy in the Middle East had always been Saddam Hussein?s secular Baathist regime in Iraq. Yet through misleading public statements, false press leaks, and even forged evidence such as the ?yellowcake? documents, the Bush administration and its neoconservative allies utilized the compliant American media to persuade our citizens that Iraq?s nonexistent WMDs posed a deadly national threat and required elimination by war and invasion. Indeed, for several years national polls showed that a large majority of conservatives and Republicans actually believed that Saddam was the mastermind behind 9/11 and the Iraq War was being fought as retribution. Consider how bizarre the history of the 1940s would seem if America had attacked China in retaliation for Pearl Harbor.

True facts were easily available to anyone paying attention in the years after 2001, but most Americans do not bother and simply draw their understanding of the world from what they are told by the major media, which overwhelmingly?almost uniformly?backed the case for war with Iraq; the talking heads on TV created our reality. Prominent journalists across the liberal and conservative spectrum eagerly published the most ridiculous lies and distortions passed on to them by anonymous sources, and stampeded Congress down the path to war.

The result was what my late friend Lt. Gen. Bill Odom rightly called the ?greatest strategic disaster in United States history.? American forces suffered tens of thousands of needless deaths and injuries, while our country took a huge step toward national bankruptcy. Economics Nobel Laureate Joseph Stiglitz and others have estimated that with interest the total long-term cost of our two recent wars may reach as high as $5 or $6 trillion, or as much as $50,000 per American household, mostly still unpaid. Meanwhile, economist Edward Wolff has calculated that the Great Recession and its aftermath cut the personal net worth of the median American household to $57,000 in 2010 from a figure nearly twice as high three years earlier. Comparing these assets and liabilities, we see that the American middle class now hovers on the brink of insolvency, with the cost of our foreign wars being a leading cause.

But no one involved in the debacle ultimately suffered any serious consequences, and most of the same prominent politicians and highly paid media figures who were responsible remain just as prominent and highly paid today. For most Americans, reality is whatever our media organs tell us, and since these have largely ignored the facts and adverse consequences of our wars in recent years, the American people have similarly forgotten. Recent polls show that only half the public today believes that the Iraq War was a mistake.

Author James Bovard has described our society as an ?attention deficit democracy,? and the speed with which important events are forgotten once the media loses interest might surprise George Orwell.

Consider the story of Vioxx, a highly lucrative anti-pain medication marketed by Merck to the elderly as a substitute for simple aspirin. After years of very profitable Vioxx sales, an FDA researcher published a study demonstrating that the drug greatly increased the risk of fatal strokes and heart attacks and had probably already caused tens of thousands of premature American deaths. Vioxx was immediately pulled from the market, but Merck eventually settled the resulting lawsuits for relatively small penalties, despite direct evidence the company had long been aware of the drug?s deadly nature. Our national media, which had earned hundreds of millions of dollars in advertising revenue from Vioxx marketing, provided no sustained coverage and the scandal was soon forgotten. Furthermore, the press never investigated the dramatic upward and downward shifts in the mortality rates of elderly Americans that so closely tracked the introduction and recall of Vioxx; as I pointed out in a 2012 article, these indicated that the likely death toll had actually been several times greater than the FDA estimate. Vast numbers Americans died, no one was punished, and almost everyone has now forgotten.

Or take the strange case of Bernard Kerik, New York Mayor Rudolph Giuliani?s police commissioner during 9/11, later nominated by President Bush to be America?s first director of national intelligence, a newly established position intended to oversee all of our various national-security and intelligence agencies. His appointment seemed likely to sail through the Republican-controlled Senate until derailed by accusations he had employed an undocumented nanny. With his political rise having been blocked, the national media suddenly revealed his long history of association with organized-crime figures, an indictment quickly followed, and he is currently still serving his federal prison sentence for conspiracy and fraud. So America came within a hairbreadth of placing its entire national-security apparatus under the authority of a high-school dropout connected with organized crime, and today almost no Americans seem aware of that fact.

Through most of the 20th century, America led something of a charmed life, at least when compared with the disasters endured by almost every other major country. We became the richest and most powerful nation on earth, partly due to our own achievements and partly due to the mistakes of others. The public interpreted these decades of American power and prosperity as validation of our system of government and national leadership, and the technological effectiveness of our domestic propaganda machinery - our own American Pravda - has heightened this effect. Furthermore, most ordinary Americans are reasonably honest and law-abiding and project that same behavior onto others, including our media and political elites. This differs from the total cynicism found in most other countries around the world.

 

Credibility is a capital asset, which may take years to accumulate but can be squandered in an instant; and the events of the last dozen years should have bankrupted any faith we have in our government or media. Once we acknowledge this, we should begin to accept the possible reality of important, well-documented events even if they are not announced on the front pages of our major newspapers. When several huge scandals have erupted into the headlines after years or decades of total media silence, we must wonder what other massive stories may currently be ignored by our media elites. I think I can provide a few possibilities.

Consider the almost forgotten anthrax mailing attacks in the weeks after 9/11, which terrified our dominant East Coast elites and spurred passage of the unprecedented Patriot Act, thereby eliminating many traditional civil-libertarian protections. Every morning during that period the New York Times and other leading newspapers carried articles describing the mysterious nature of the deadly attacks and the complete bafflement of the FBI investigators. But evenings on the Internet I would read stories by perfectly respectable journalists such as Salon?s Laura Rozen or the staff of the Hartford Courant providing a wealth of additional detail and pointing to a likely suspect and motive.

Although the letters carrying the anthrax were purportedly written by an Arab terrorist, the FBI quickly determined that the language and style indicated a non-Arab author, while tests pointed to the bioweapons research facility at Ft. Detrick, Md., as the probable source of the material. But just prior to the arrival of those deadly mailings, military police at Quantico, Va., had also received an anonymous letter warning that a former Ft. Detrick employee, Egyptian-born Dr. Ayaad Assaad, might be planning to launch a national campaign of bioterrorism. Investigators quickly cleared Dr. Assaad, but the very detailed nature of the accusations revealed inside knowledge of his employment history and the Ft. Detrick facilities. Given the near-simultaneous posting of anthrax envelopes and false bioterrorism accusations, the mailings almost certainly came from the same source, and solving the latter case would be the easiest means of catching the anthrax killer.

Who would have attempted to frame Dr. Assaad for bioterrorism? A few years earlier he had been involved in a bitter personal feud with a couple of his Ft. Detrick coworkers, including charges of racism, official reprimands, and angry recriminations all around. When an FBI official shared a copy of the accusatory letter with a noted language-forensics expert and allowed him to compare the text with the writings of 40 biowarfare lab employees, he found a perfect match with one of those individuals. For years I told my friends that anyone who spent 30 minutes with Google could probably determine the name and motive of the likely anthrax killer, and most of them successfully met my challenge.

This powerful evidence received almost no attention in the major national media, nor is there any indication that the FBI ever followed up on any of these clues or interrogated the named suspects. Instead, investigators attempted to pin the attacks on a Dr. Steven Hatfill based on negligible evidence, after which he was completely exonerated and won a $5.6 million settlement from the government for its years of severe harassment. Later, similar hounding of researcher Bruce Ivins and his family led to his suicide, after which the FBI declared the case closed, even though former colleagues of Dr. Ivins demonstrated that he had had no motive, means, or opportunity. In 2008, I commissioned a major 3,000-word cover story in my magazine summarizing all of this crucial evidence, and once again almost no one in the mainstream media paid the slightest attention.

An even more egregious case followed a couple of years later, with regard to the stunning revelations of Pulitzer Prize winner Sydney Schanberg, one of America?s foremost Vietnam War reporters and a former top editor at the New York Times. After years of research, Schanberg published massive evidence demonstrating that the endlessly ridiculed claims of America?s Vietnam MIA movement of the 1970s and 1980s were correct: the Nixon administration had indeed deliberately abandoned many hundreds of American POWs in Vietnam at the close of the war, and our government afterward spent decades covering up this shameful crime. Schanberg?s charges were publicly confirmed by two former Republican House members, one of whom had independently co-authored a 500 page book on the subject, exhaustively documenting the POW evidence.

Although a major focus of Schanberg?s account was the central role that Sen. John McCain had played in leading the later cover-up, the national media ignored these detailed charges during McCain?s bitter 2008 presidential campaign against Barack Obama. One of America?s most distinguished living journalists published what was surely ?the story of the century? and none of America?s newspapers took notice.

In 2010 Schanberg republished this material in a collection of his other writings, and his work received glowing praise from Joseph Galloway, one of America?s top military correspondents, as well as other leading journalists; his charges are now backed by the weight of four New York Times Pulitzer Prizes. Around that same time, I produced a 15,000-word cover-symposium on the scandal, organized around Schanberg?s path-breaking findings and including contributions from other prominent writers. All of this appeared in the middle of Senator McCain?s difficult reelection campaign in Arizona, and once again the material was totally ignored by the state and national media.

An argument might be made that little harm has been done to the national interest by the media?s continued silence in the two examples described above. The anthrax killings have largely been forgotten and the evidence suggests that the motive was probably one of personal revenge. All the government officials involved in the abandonment of the Vietnam POWs are either dead or quite elderly, and even those involved in the later cover-up, such as John McCain, are in the twilight of their political careers. But an additional example remains completely relevant today, and some of the guilty parties hold high office.

During the mid-2000s I began noticing references on one or two small websites to a woman claiming to be a former FBI employee who was making the most outlandish and ridiculous charges, accusing high government officials of selling our nuclear-weapons secrets to foreign spies. I paid no attention to such unlikely claims and never bothered reading any of the articles.

A couple of years went by, and various website references to that same woman?Sibel Edmonds?kept appearing, although I continued to ignore them, secure that the silence of all my newspapers proved her to be delusional. Then in early 2008, the London Sunday Times, one of the world?s leading newspapers, ran a long, three-part front-page series presenting her charges, which were soon republished in numerous other countries. Daniel Ellsberg described Edmonds?s revelations as ?far more explosive than the Pentagon Papers? and castigated the American media for completely ignoring a story that had reached the front pages of newspapers throughout the rest of the world. Such silence struck me as rather odd.

Philip Giraldi, a former CIA official who regularly writes for this magazine, suggested he investigate her charges. He found her highly credible, and his 3,000-word article in TAC presented some astonishing but very detailed claims.

Edmonds had been hired by the FBI to translate wiretapped conversations of a suspected foreign spy ring under surveillance, and she had been disturbed to discover that many of these hundreds of phone calls explicitly discussed the sale of nuclear-weapons secrets to foreign intelligence organizations, including those linked to international terrorism, as well as the placement of agents at key American military research facilities. Most remarkably, some of the individuals involved in these operations were high-ranking government officials; the staffs of several influential members of Congress were also implicated. On one occasion, a senior State Department figure was reportedly recorded making arrangements to pick up a bag containing a large cash bribe from one of his contacts. Very specific details of names, dates, dollar amounts, purchasers, and military secrets were provided.

The investigation had been going on for years with no apparent action, and Edmonds was alarmed to discover that a fellow translator quietly maintained a close relationship with one of the key FBI targets. When she raised these issues, she was personally threatened, and after appealing to her supervisors, eventually fired.

Since that time, she has passed a polygraph test on her claims, testified under oath in a libel lawsuit, expanded her detailed charges in a 2009 TAC cover story also by Giraldi, and most recently published a book recounting her case. Judiciary Committee Senators Chuck Grassley and Patrick Leahy have publicly backed some of her charges, a Department of Justice inspector general?s report has found her allegations ?credible? and ?serious,? while various FBI officials have vouched for her reliability and privately confirmed many of her claims. But none of her detailed charges has ever appeared in any of America?s newspapers. According to Edmonds, one of the conspirators routinely made payments to various members of the media, and bragged to his fellow plotters that ?We just fax to our people at the New York Times. They print it under their names.?

At times, Congressional Democratic staff members became interested in the scandal, and promised an investigation. But once they learned that senior members of their own party were also implicated, their interest faded.

These three stories?the anthrax evidence, the McCain/POW revelations, and the Sibel Edmonds charges?are the sort of major expos', this, event, '150px')">Guest Post: Our American Pravda (47 mins ago)
success of Abenomics, Mizuho\'s chief economist simply explains, \"because I am not suffering from amnesia,\" as the rest of the market appears to be. He goes in this brief interview with the FT to explain there is nothing new here. We already saw massive fiscal expenditure in the 1990s (which failed to gain any real economic traction) and as far as quantitative easing, Ueno reminds his interviewer, we saw major QE between 2001 and 2006 (that failed), Furthermore, the so-called growth strategy, \"every Japanese cabinet has undertaken such doctrines without any success.\" The discussion then switches from the dashing of hopes to the risks of the policy. Five minutes well spent this weekend to remind your momentum-driven recency-biased anchored view of the world that there is nothing new under the sun and moar is not always better...

 

    ', this, event, '150px')">"Those Who Believe In Abenomics Are Suffering From Amnesia" (2 hours ago)
Street Talk Live blog,

In several of my recent missives I have made several references to the wave of deflationary pressures that are currently encircling the globe.  

In \"Japan: A Few Thoughts On The Crash\" I stated:

\"The unintended consequence of such actions, as we are witnessing in the U.S. currently, is the ongoing battle with deflationary pressures. The lower interest rates goes the less economic return that can be generated. An ultra-low interest rate environment, contrary to mainstream thought, has a negative impact on making productive investments and risk begins to outweigh the potential return.\"

Also, in \"Bernanke\'s Link to \"Mother Nature\"

\"How many more natural disasters will come to offset the negative economic impact of a zero interest rate environment coupled with a wave of deflationary pressures is unknown.\"

But most importantly in \"Why Bonds Aren\'t Dead & The Dollar Will Get Weaker\" I stated:

\"A wave of \'disinflation\' is currently engulfing the globe as the Eurozone economy slips back into recession, China is slowing down and the U.S. is grinding into much slower rates of growth. Even Japan, despite their best efforts through a massive QE program, cannot seem to break the back of the deflationary pressures on their economy. This is a problem that has yet to be recognized by the financial markets.

 

The recent inflation reports (both the Producer and Consumer Price Indexes) show deflationary forces at work. Wages continue to wane, economic production is stalling and price pressures are falling. More importantly, there are downward pressures on the most economically sensitive commodities such as oil, copper and lumber all indicating weaker levels of economic output. The battle against deflationary economic pressures has been what the Federal Reserve has been forced to fight since the financial crisis. The problem has been that, much like \'Humpty-Dumpty\', the broken financial transmission system, as represented by the velocity of money, can\'t be put back together again.\"

The last paragraph above is particularly important.  The biggest fear of the Federal Reserve has been the deflationary pressures that have continued to depress the domestic economy.  Despite the trillions of dollars of interventions by the Federal Reserve the only real accomplishment has been keeping the economy from slipping back into an outright recession.  However, when looking at many of the economic and confidence indicators, there are many that are still at levels normally associated with previous recessionary lows.  Despite many claims to the contrary the global economy is far from healed which explains the need for ongoing global central bank interventions.  However, even these interventions seem to be having a diminished rate of return in spurring real economic activity despite the inflation of asset prices.

Despite the ongoing rhetoric of those fearing inflation due to the Fed\'s monetary interventions the reality is that such actions have, so far, failed to overcome the deflationary forces of weak global demand.   The chart below is the spot price of copper.   Copper, often dubbed \"Dr. Copper\", is very sensitive to economic growth as copper is used in everything from production, to manufacturing, transportation, housing, etc.   So goes copper - so goes the economy.   Copper is currently confirming the peak in economic growth for the current cycle.

However, the question remains, do we have inflation or don?t we?  Are we experiencing the 1970?s all over again as inflation kills the economy, or in the words of Ben Bernanke, have we entered an era of low inflation and interest rates that will last for some time as the threat of deflation remains a prevalent enemy to the economic recovery?  

3 Components Of Inflation

I believe that there are three components required to create a truly inflation environment. 

Commodity price inflation is certainly one of them as it does immediately impact the consumptive capability of the average consumer.   However, in order to see true pricing pressures across the economy there are two other factors that are critical; 1)the velocity of money, or how fast money is flowing through the system from the banks to small businesses and ultimately consumers, and; 2) wage growth which gives the consumer increased purchasing power.

Why are these two factors so critical to overall inflation question?   In the most recent  NFIB survey only a small fraction of respondents stated that this was a ?good time to expand their business? while the majority of respondents stated that their major concerns were ?poor sales, taxes and government regulations?.  If you are a small business, who coincidently creates roughly 70% of all new jobs in the economy, and you are worried about poor sales prospects and a weak economic environment, it is highly unlikely that you are going to borrow money to expand your business or extend credit to customers.  Businesses in turn choose to hoard cash as a hedge against a weak economic environment instead of making productive investments that will lead to more jobs and higher wages. 

Besides the rise and fall of commodity prices, which do indeed contribute to the inflationary backdrop, the demand for money to make productive investments by businesses which leads to higher levels of production, wage growth and, ultimately, consumption is what drives overall inflation.  It is important to remember that in economics inflation is:

\"...a rise in the general level of prices of goods and services in an economy over a period of time.  When the general price level rises, each unit of currency buys fewer goods and services. Consequently, inflation reflects a reduction in the purchasing power per unit of money ? a loss of real value in the medium of exchange and unit of account within the economy.\"

It is very difficult to have a \"general rise in price levels\" amidst a lack of consumer demand driven by suppressed wages, high levels of unemployment and little demand for credit by businesses. The lack of demand exerts downward pressures on the pricing of goods and services keeping businesses on the defensive.  This virtual spiral is why deflationary environments are so dangerous and very difficult to break.

I have constructed a composite \"High Inflation Index\" in an attempt to measure these three legs of inflationary pressures.  The purpose, of course, is to visualize the data to determine if inflation is prevalent in the current economic cycle or not.   The index is equally weighted of the M2 Velocity of Money, the Year Over Year (YOY) percent change in wages and the YOY percent change in the Consumer Price Index (CPI).  The first chart shows the historical levels of each of the three components.

Notice that there is a very tight relationship between the rise and fall of compensation of employees and the velocity of M2 money supply.  With M2 velocity plunging to historically low levels this does not bode well for sustained increases in either employment or compensation as the demand for money simply does not exist currently.  The next chart is the weighted average of the three components into an index. 

The index clearly shows the \"high inflationary\" pressures that were prevalent in the 1970?s as the economy suffered real inflation and rapidly rising interest rates.   Recently, inflationary pressures rose as economic growth surged from the lows of the financial crisis as the economic system was flooded by trillions of dollars of stimulus, bailouts and financial supports.  However, that surge, in both the economic growth and the inflationary pressures, peaked in early 2011 and have been on the decline since.  This is why the Federal Reserve remains extremely worried about the diminishing rate of return on their monetary experiments as it relates to the economy.  Inflating asset prices higher have increased consumer confidence but has had little translation into the creation of underlying economic growth.

With the index clearly warning of rising deflationary pressures in the economy, which has recently been seen in many of the manufacturing reports that have shown downward pricing pressures both on prices paid and received, there is no \"exit\" currently for the Federal Reserve to reduce its monetary supports.  The real concern is that with the index at just 4.88%, which is well below the long term average of 11.63%, that the economy is far to weak to handle much of an exogenous shock.

The risk, as discussed recently with relation to Japan, is that the Fed is now caught within a \"liquidity trap.\"  The Fed cannot effectively withdraw from monetary interventions and raise interest rates to more productive levels without pushing the economy back into a recession.  The overriding deflationary drag on the economy is forcing the Federal Reserve to remain ultra-accommodative to support the current level of economic activity.  What is interesting is that mainstream economists and analysts keep predicting stronger levels of economic growth while all economic indications are indicating just the opposite.

Despite the Fed\'s recent communications that they are planning to \"taper\" the current monetary program by the end of this year - the index is suggesting that their interventions, in one form or another, are unlikely to end anytime soon.  The threat of \"deflation\" remains the Fed\'s primary concern.

    ', this, event, '150px')">Guest Post: The Fed's Real Worry - A Pick Up In Deflation (3 hours ago)
massive short positioning in Gold futures that has BofAML\'s commodity strategists concerned; but the regime changes in the precious metal\'s volatility structures suggests risks are significantly mispriced relative to equities, rates, and other commodities. Following the most abrupt price collapse in 30 years, near-dated implied volatility in gold spiked dramatically in the past month. The term structure of implied gold volatility has also changed shape and the market now shows a marked put skew. Even then, the spike in precious metals volatility had remained a rather isolated event until this week?s sharp drop in Japanese equities. As the following chartapalooza demonstrates, while large-scale QE has tempered volatility across all asset classes for months, we remain concerned about the recent sharp price movements in gold or Japanese equities, and see a risk that other bubbling asset classes may follow.

Via BofAML\'s Commodity Derivatives Insights,

Manic gold

Gold volatility has spiked following the price meltdown...Following the most abrupt price collapse in 30 years, near-dated implied volatility in gold spiked dramatically in the past month (Chart 2).

Even then, the spike in precious metals volatility has remained until recent ly a rather isolated event. As we have discussed before, large-scale QE has tempered volatility across all asset classes for months, but price movements of this magnitude have yet to occur in other markets. In that sense, Japan?s equity market swing this week may be the second victim of large-scale QE. If so, volatility in other asset classes may follow. For now, implied gold and silver volatilities seem expensive relative to other commodity markets (Chart 3) or even other asset classes.

...and its term structure has dramatically changed shapeThe increase in paper gold selling has met strong physical gold buying, as heavy investor flow has been somewhat offset by very robust jewelry and coin demand. As a result of the strong physical bid for the yellow metal, the term structure of gold prices has changed in recent months (Chart 4), and the discount of near-dated contracts relative to forward prices has narrowed despite higher interest rates.

Naturally, the term structure of gold volatility has also dramatically changed shape to reflect the abrupt prompt price swings (Chart 5) and it is now in backwardation, an unusual shape for this market.

The skew has also changed abruptly in just a few weeks...The change in the term structure of gold is not the only drastic alteration of the implied volatility surface in the gold market. Of course, after a 12-year bull run, gold prices had naturally developed a marked call skew in the past decade (Chart 6), as the positive skew of returns kept OTM call options on gold very well bid.

This skew has now completely reversed on the back of the sharp pullback in gold prices (Chart 7), suggesting that the market is now much more concerned about downside than upside risks

...and puts are now much more expensive than callsTrue, it is not unusual for a market to develop such a meaningful put skew after a one-in-thirty years price drop. However, this also means that gold is very unlikely to experience such a dramatic drop again over the coming months, in our view. As a result, we believe that the 3M 25D risk reversals seem extremely distressed relative to recent history (Chart 8).

Without a doubt, gold prices have experienced periods where returns maintained a negative skew in the 1980s and 1990s (Chart 9), but a soft floor set by a relatively high marginal cost of production of $1150/oz suggests the skew may be reflecting too much fear.

Changes in real rates tend to drive gold prices and vol...At any rate, our quantitative gold models can only explain a small fraction of the gold price move. By extension, as we model gold price volatility, we can only explain a small fraction of the move that gold vol has experienced (Chart 11).

Our analysis suggests that gold vol is a function of broad market risk, broad commodity volatility, rates volatility, FX volatility, as well as movements in gold itself. Just as real interest rates in USD tend to be a major driver of gold prices (Chart 12), volatility in interest rates is also a very important determinant of gold vol.

...while commodity and FX price movements matter too Historically, gold and oil have kept a very tight relationship for more than 100 years as well (Chart 13), so that oil vol is closely interlinked with gold vol.

Movements in FX also matter for gold, particularly those of the trade-weighted US dollar. The recent strength in the USD, in particular against the JPY, has likely put some downside pressure on gold prices (Chart 14). More importantly, the pick-up in FX volatility relative to other asset classes has probably been a contributor to the spike in gold prices in recent months.

In the end, it is all about fiscal, monetary, and CA balances While near-term changes in FX, rates or commodity prices can help explain changes in gold prices and volatility, the structural factors behind gold remain fiscal and monetary policy, as well as current account balances. In that sense, fiscal consolidation is the enemy of gold just like fiscal profligacy can destroy confidence in fiat currency, and the recent tightening of budgetary gaps has not helped support the gold market. Having said that, current account balances are not shrinking anymore, with Central Bank assets once again growing fast. In part, this reflects the inability or unwillingness of China, Japan, and the Eurozone to run current account deficits. It also reflects persistently high crude oil prices and the accumulation of large surpluses at producing nations.

While gold vol has spiked, other assets have not noticed In that sense, we believe that implied gold volatility is very strained when compared to the volatility in other asset classes. Put otherwise, if large-scale QE is distorting asset prices, volatility pockets are likely to emerge across many markets, not just gold. For example, gold volatility is at present higher than volatility in oil markets (Chart 17), a rather unusual situation given the completely different nature of these two commodities.

Even when looked at against equities, gold vol looks particularly expensive at this point (Chart 18). If the recent crash in Japanese equities is a canary in the QE coal mine, S&P500 vol may be undervalued relative to gold price volatility.

1M gold vol feels expensive, with OTM puts most overpricedAlso, our broad market risk index seems low relative to recent movements in the gold market. Yet, as we have argued throughout this note, gold prices and gold volatility are as much a victim of QE excesses as any other asset class. Thus, while gold has already had its ?eight-sigma? event this year, other markets may yet have to experience it.

With near-dated implied gold volatility trading at very distressed levels, we believe gold vol provides an attractive short particularly against longs in volatilities in other markets such as equities, rates, or even commodities (Chart 20).

    ', this, event, '150px')">First, Gold; Second, Japanese Equities; Who's Next For The 8-Sigma Risk Flare? (4 hours ago)
\"Is The SEC\'s Insider Trading Case Implicating FrontPoint A Sting Operation Aimed At S.A.C. Capital?\" which exposed the key biotech aspect of SAC\'s insider trading strategy, and which linked SAC, and the hedge fund world in general, to expert networks three weeks before virtually anyone outside of the 2 and 20 (or 3 and 50 as the case may be) world had heard of them and befre they became a household euphemism for insider trading information, we expected the full rabid fury of the world\'s best paid legal team to fall upon us. It didn\'t, which meant only one thing: we were correct, or they had bigger problems on their mind. Turns out it was both.

In the months and years following our publication, what we speculated has become fact, and as Vanity Fair\'s Bryan Burroughs reports, some 71 people have now been convicted or admitted guilt in the case of the government vs Stevie Cohen.

 But the final blow against the formerly infallible hedge fund that redefined the concept of \"information arbitrage\", and whose track record was almost as successful as that of Bernie Madoff, came from Blackstone, which as Reuters reported moments ago, has decided to pull all its money from SAC, which is the official end of SAC as an outside investment asset management operation. Because once the fund of funds operator, and the largest outside investor in SAC, votes no confidence in Cohen, it\'s game over, and at best SAC may remain as a family and employee-funded office, assuming of course the DOJ doesn\'t actually decide to demand restitution for years and decades of insider trading.

Actually, one outside investor may remain: the always amusing Anthony Scaramucci, head of the PR company, which has an occasional FOF operation, SkyBridge Capital. From NYT:

A group of Mr. Cohen?s investors continue to stand by him and hope that he stays in business. For Anthony Scaramucci, chief executive of the hedge fund firm SkyBridge Capital and a friend of Mr. Cohen?s, sticking with SAC has as much to do with friendship and loyalty as it does its superior performance.

 

?A lot of guys, when bombs are going off, you figure out very quickly who your friends are in the trenches,? Mr. Scaramucci said. ?Most friends run from bullets, but your best friends run toward them. I have enormous amount of respect for the guy, and I think he?s misunderstood.?

He may be forced to change his tune once Cohen unwinds all outside capital. In the meantime, Blackstone is done. From Reuters:

Billionaire hedge fund manager Steven A. Cohen is losing the financial support of Blackstone Group Inc, the largest outside investor in his embattled SAC Capital Advisors, which is yanking much of its client money, according to a letter reviewed by Reuters.

 

A pension consultant, in a May 21 letter to clients, said Blackstone has notified Cohen that it intends to \"fully redeem\" a significant portion of the roughly $550 million the investment firm has invested with the $15 billion hedge fund. The letter from pension consulting firm Russell Investments said Blackstone submitted its redemption notice to SAC Capital sometime before May 15 because of ongoing concerns about the insider trading investigation that continues to engulf Cohen\'s fund.

 

Blackstone\'s investment with SAC Capital is through several investment funds known as hedge fund of funds and also through separately managed accounts it maintains for clients. The decision to redeem from SAC Capital impacts only client money invested in its hedge fund of funds, according to the letter. It\'s not clear how much of the $550 million is in those hedge fund of funds and it is not clear what Blackstone is advising clients who have money in separately managed accounts that is invested with SAC Capital.

 

Russell did say in the address to its pension clients that Blackstone \"expects to receive 100 percent of investors\' capital by year-end.\" Russell, which manages $173 billion in assets and oversees a number of index funds, also provides advice to pensions and institutional investors on where to invest their dollars in hedge funds.

Regardless, Blackstone\'s decision is a black stamp of death for SAC:

The decision by Blackstone, which has invested with SAC Capital for at least a decade, is a big blow to the 56-year-old fund manager, who is widely regarded as one of the most successful traders of his generation. Blackstone - which manages about $46 billion in hedge fund investments for public pensions, foundations, corporations and wealthy individuals - is seen as something of a bellwether for other investors in the $2.2 trillion hedge fund industry because of its stature.

 

Blackstone\'s hedge fund of funds invests client money with more than four dozen hedge funds, including SAC Capital, Pershing Square Capital Management, Elliott Management and DE Shaw & Co, according to people familiar with the private equity firm\'s asset management business.

 

The decision by Blackstone to redeem comes after the private equity and investment firm has stuck with Cohen throughout the course of the long-running investigation that has so far resulted in nine one-time employees of the firm being charged or implicated in insider trading schemes

The decision is now up to Cohen whether to keep operating in a reduced capacity ex-outside capital, or shut down altogether to remove any spotlight from his hedge fund which suddenly and \"inexplicably\" is dramatically underperforming the broader market. Should he choose the latter, the implications for market liquidity, already negligible at best, would be dire.

In which case the most important question is if and when the market will begin front-running the liquidation of Cohen\'s positions, of which there are some $18.6 billion in total, the top 30 of which are listed below:

Finally, anyone who still is unfamiliar with the epic story of Moby Steve and its inevitable denouement, the Vanity Fair\'s \"The Hunt for Steve Cohen\" is the best place to start.

    ', this, event, '150px')">With The Unwind Approaching, Here Are $18.6 Billion SAC Capital's Largest Stock Positions (5 hours ago)
Peak Prosperity blog,

?When plunder becomes a way of life for a group of men in a society, over the course of time they create for themselves a legal system that authorizes it and a moral code that glorifies it.\"

- Frederic Bastiat

Bill Black is a former bank regulator who played a central role in prosecuting the corruption responsible for the S&L crisis of the late 1980s. He is one of America\'s top experts on financial fraud. And he laments that the US has descended into a type of crony capitalism that makes continued fraud a virtual certainty - while increasingly neutering the safeguards intended to prevent and punish such abuse.

In this extensive interview, Bill explains why financial fraud is the most damaging type of fraud and also the hardest to prosecute. He also details how, through crony capitalism, it has become much more prevalent in our markets and political system. 

A warning: there\'s much revealed in this interview to make your blood boil. For example: the Office of Thrift Supervision. In the aftermath of the S&L crisis, this office brought 3,000 administration enforcements actions (a.k.a. lawsuits) against identified perpetrators. In a number of cases, they clawed back the funds and profits that the convicted parties had fraudulently obtained.

Flash forward to the 2008 credit crisis, in which just the related household sector losses alone were over 70x greater than those seen during the entire S&L debacle. So how many criminal referrals did the same agency, the Office of Thrift Supervision, make?

Zero.

Similar dismal action was taken by such other financial regulators as the Office of the Comptroller of the Currency, the Federal reserve and the FDIC. 

Where is the accountability?, you may be asking. Or perhaps, how did we allow things to get this bad?

Fraud is both a civil wrong and a crime and it\'s when I get you to trust me and then I betray your trust in order to steal from you. As a result, there?s no more effective acid against trust than fraud and, in particular, elite fraud, which causes people to no longer trust folks, economies break down, families break down, political systems break down and such if you don?t have that kind of trust. So that?s what fraud is.

 

But what my work focuses on is: what kind of frauds are the most devastating? And it turns out that the most kind of problems that we?re seeing, systemic problems and such, arise when we have, what we call in criminology, control fraud. And control fraud simply means when you have a seemingly legitimate entity and the person who controls it uses it as a weapon to defraud others. And so in the financial sphere the weapon of choice is accounting and the losses from these kinds of control frauds exceed the financial losses from all other forms of property crime combined.

 

So for example, in the current crisis, as with the prior ones, if you?re a lender there?s an easy recipe for maximizing fake accounting income. And it goes like this. You need four ingredients:

grow like crazy by making really, really crappy loans but at a premium yield (yield just means \'interest rate\') while employing extreme leverage, and while setting aside only the most trivial reserves or allowances for the inevitable losses this kind of behavior produces.

George Akerlof and Paul Romer wrote the classic article in economics about this in 1993. And their title really says it all in terms of the dynamic: Looting the Economic Underworld of Bankruptcy for Profit. The idea is you have a seemingly legitimate entity, the person at the top is looting it. They loot it by destroying it but they walk away wealthy. Of course, in the modern era we don?t necessarily, we may bail out the entity. So it may not even fail in that sense.

 

But here?s what Akerlof and Romer also said that was so critical as an understanding. They said these four steps, these four ingredients: it\'s just math. It is ? and I?m quoting them now ?a sure thing.? So you?re mathematically guaranteed if you do these four things to report, not just substantial income, but record levels of income.

 

The big thing about the seemingly legitimate entity when the CEO is the crook is, first, everybody reports to the CEO ultimately, right? So the CEO is the point failure mechanism where if he or she goes bad, almost everything may go bad as well. So all those things that we call internal and external controls, all report to the CEO and the CEO therefore can, as I?ll describe, use compensation, hiring, firing, praise, and such to produce the environment that will commit, create allies for his fraud. Now, note that what I?m saying. The CEO, the art of this is not to defeat your controls. The elegant solution as in mathematics is to suborn the controls and turn them into your most valuable allies. And therefore, for example, when you?re running accounting control fraud where your weapon of fraud is accounting and that weapon of choice in finance is accounting. You?re going to want to hire the most prestigious accountants as your outside auditors because it is precisely their reputation that is most valuable when you can suborn them. And, they give you that clean opinion that you just described that will help you deceive other shareholders. So one enormous advantage is internal and external controls come to the CEO level.

 

A second incredible advantage is the CEO can optimize the firm as a weapon of fraud. And the< CEO can do that. Basically, this falls into two big categories. One, you can put it in assets that have no readily verifiable market value because then it\'s a lot easier to inflate asset valuations and to hide real losses. And the second thing you do is grow like crazy. And, of course, that is the essence of something your listeners have all heard about, and that is a Ponzi scheme. And so these accounting control frauds have strong Ponzi-scheme like elements, which is why they tend to cause such catastrophic losses.

Click the play button below to listen to Part I of Chris\' interview with Bill Black (58m:28s). Part II can be accessed by clicking here.

    ', this, event, '150px')">Bill Black: Our System Is So Flawed That Fraud Is Mathematically Guaranteed (6 hours ago)
    ', this, event, '150px')">Gold And The Fiat End-Game (8 hours ago)
intentionally - pumped them up.

They've also skyrocketed because the Fed and other central banks are directly buying stocks.

NBC News reports on a third major reason that stocks took off ... corporate buybacks:

It's the narcissist rally.

 

***

You may want to spare a thought, and a healthy dose of worry, for what is one of the biggest, and least appreciated, reasons for the rally: buybacks.

 

Flush with cash and a world of opportunity at their doorstep, companies have decided there's nothing more attractive than themselves. So, they're offering big money to buy back their own stock. This year, big U.S. companies have given the go-ahead for $286 billion of buybacks, up 88 percent from the same period last year, according to Birinyi Associates, a market research firm. If the pace continues for the rest of the year, the tally will exceed the record set in 2007.

 

Every manner of company is caught up in the buying binge, including home-improvement chains, makers of farm equipment and jet engines, airlines, sellers of soft drinks and of hard liquor alike. Not one to miss a hot trend, Apple recently authorized as much as $50 billion of buybacks.

 

Investors like buybacks because they suggest companies think their stock is cheap. They also help reduce the number of shares outstanding, which automatically increases earnings per share. And higher earnings per share often, though not always, lead to rising stock prices.

 

But buybacks are also crucial to the rally for a reason that's not widely known. Companies are one of the few big stock purchasers nowadays. Nearly every other big player in the stock market has been selling more than they've been buying.

Pension funds have been selling. Local and state governments have been selling. Investment brokerages have been selling. And, yes, until recently, even Main Street investors.

 

You can see this in the data released by the Federal Reserve each quarter, and it's a sea of red — save for corporate buying, that is, buybacks plus purchases of other companies. In total, U.S. companies, not counting banks and other financial firms, have bought more than $1 trillion of stock in the five years through 2012, net of stocks they've issued.

 

***

 

However much they spend, each dollar of buybacks appears to be having a greater effect on raising the prices of certain stocks. That's because fewer shares are changing hands each day. On Wall Street, it's referred to as a "drying up" of liquidity. And like in any market, a purchase or sale when fewer people are trading can push prices up and down much more.

 

DirecTV bought $1.4 billion of its own shares in the first quarter, or 7.8 percent of all trades in the company's stock, according to data from Birinyi Associates. DirecTV rose 12.8 percent in the same period, two points more than the Standard and Poor's 500. IBM bought $2.6 billion of its shares in the first quarter, or 5.6 percent of what was traded. It rose 11.8 percent.

 

***

 

Companies that do buy back their own stock are seeing prices soar, and almost immediately.

 

On Friday, Northrup Grumman jumped 4 percent after announcing it had authorized $4 billion of buybacks. The military contractor said it expects buybacks will cut its shares outstanding by 25 percent by the end of 2015.

 

Another big share buyer, Home Depot, rose 5.7 percent on Feb. 26 after it announced a $17 billion buyback program. The S&P 500 rose 0.6 percent that day. If the retailer spends all the authorized in its plan, it will remove 18 percent of the shares outstanding at current prices, which will make the impact of a next round of purchases even more powerful.

 

Stocks of companies that have authorized the 10 biggest buybacks so far this year have risen 2.2 points more than the S&P 500 in the week after their announcements....

 

Gregory Milano, CEO of consultancy Fortuna Advisors, has run studies showing that companies that spend the most on buying back their own stock tend to underperform because they don't spend enough on opening new factories, research or otherwise building their business for the long term.

 

Andrew Smithers, who runs a London-based investment consultancy, thinks buybacks have pushed stocks more than 40 percent higher than they're worth. In his book "The Great Deformation," former U.S. budget director David Stockman says Corporate America is drunk on buybacks and that they've helped push stocks up too far, too.

 

***

 

Forty percent of the increase in the earnings per share of S&P 500 companies in the past 12 months came from reducing the number of shares through buybacks, estimates Barry Knapp, chief U.S. stock strategist at Barclays Capital.

Postscript:  Max Keiser points out that quantitative easing and corporate buybacks are related. 

Specifically, the Fed's easy monetary policy means that big corporations can borrow cheaply ... and then use the money to buy back their own stock.

The bailouts and easy money aren't going into helping Main Street or stabilizing the economy.

Of course, most of the trading is done by high frequency computers these days.

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Clusterstock

Blackstone\'s investment with SAC Capital is through several investment funds known as hedge fund of funds and also through separately managed accounts it maintains for clients. The decision to redeem from SAC Capital impacts only client money invested in its hedge fund of funds, according to the letter. It\'s not clear how much of the $550 million is in those hedge fund of funds and it is not clear what Blackstone is advising clients who have money in separately managed accounts that is invested with SAC Capital.

Russell did say in the address to its pension clients that Blackstone \"expects to receive 100 percent of investors\' capital by year-end.\" Russell, which manages $173 billion in assets and oversees a number of index funds, also provides advice to pensions and institutional investors on where to invest their dollars in hedge funds.

The timing of Blackstone\'s request to withdraw money from SAC Capital is critical because it came before the hedge fund told investors on May 17 that its cooperation with federal authorities was no longer unconditional. Soon after, news broke that federal prosecutors had issued grand jury subpoenas earlier this month to Cohen and several of his top executives, seeking their testimony about insider trading at the hedge fund.

The decision by Blackstone, which has invested with SAC Capital for at least a decade, is a big blow to the 56-year-old fund manager, who is widely regarded as one of the most successful traders of his generation. Blackstone - which manages about $46 billion in hedge fund investments for public pensions, foundations, corporations and wealthy individuals - is seen as something of a bellwether for other investors in the $2.2 trillion hedge fund industry because of its stature.

Representatives for Blackstone did not immediately respond when asked for comment on Saturday. An SAC Capital spokesman declined to comment.

The letter from Russell Investments, which was reviewed by Reuters, made no mention of the subpoenas on Cohen and his executives and was sent after a Russell representative talked to a Blackstone executive about the redemption decision. The letter said Blackstone decided to submit a redemption notice to SAC Capital after reviewing the terms of a $616 million deal SAC Capital reached in March with the U.S. Securities and Exchange Commission to settle allegations that the hedge fund\'s employees had engaged in insider trading in four stocks.

Blackstone, according to the letter, said the settlement with the SEC \"did not give additional comfort that the issues at-hand were resolved.\"

A representative for Russell Investments did not respond to a request for comment about the letter from its Russell Research division.

Outside investors in SAC Capital like Blackstone, who account for roughly $6.75 billion of the $15 billion managed by Cohen, have until June 3 to decide whether to submit redemption notices for the second quarter. In the first quarter, outside investors notified Cohen they intend to withdraw about $1.7 billion of that $6.75 billion by year\'s end.

People close to SAC Capital said Cohen, who has roughly $8 billion of his money invested in SAC Capital, is bracing for another large round of redemption requests. The speculation is growing in the hedge fund world that if Cohen gets another large round of redemption requests, he may opt to return all the outside money and convert SAC Capital into a family office - an unregistered firm that manages money just for himself and his friends and family.

SAC Capital is one of the world\'s larger hedge funds with 1,000 employees.

Blackstone\'s hedge fund of funds invests client money with more than four dozen hedge funds, including SAC Capital, Pershing Square Capital Management, Elliott Management and DE Shaw & Co, according to people familiar with the private equity firm\'s asset management business.

The decision by Blackstone to redeem comes after the private equity and investment firm has stuck with Cohen throughout the course of the long-running investigation that has so far resulted in nine one-time employees of the firm being charged or implicated in insider trading schemes.

Cohen himself has not been charged with wrongdoing, but the investigation is seen as increasingly focusing on him and his firm.

In late April, lawyers for Cohen and his firm met with federal prosecutors in Manhattan to make their best case argument about why the hedge fund billionaire and his SAC Capital Advisors should not be charged with criminal wrongdoing. But people familiar with that meeting said the lengthy presentation did not impress federal prosecutors, who are now considering whether to use a racketeering law aimed at prosecuting the Mafia and drug gangs to pursue a criminal case against Cohen\'s hedge fund.

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', this, event, '150px')">REPORT: SAC Capital's Biggest Outside Investor Wants To Pull Money Out (1 hour ago)

Those vulnerable crossing carry millions of drivers every day. In Boston, a six-lane highway 1A near Logan airport includes a \"fracture critical\" bridge over Bennington Street. In northern Chicago, an I-90 pass that goes over Ashland Avenue is in the same category. An I-880 bridge over 5th Avenue in Oakland, Calif., is also on the list.

Also in that category is the Interstate 5 bridge over the Skagit River north of Seattle, which collapsed into the water days ago after officials say an oversized truck load clipped the steel truss.

Public officials have focused in recent years on the desperate need for money to repair thousands of bridges deemed structurally deficient, which typically means a major portion of the bridge is in poor condition or worse. But the bridge that collapsed Thursday is not in that deficient category, highlighting another major problem with the nation\'s infrastructure: Although it\'s rare, some bridges deemed to be fine structurally can still be crippled if they are struck hard enough in the wrong spot.

\"It probably is a bit of a fluke in that sense,\" said Charles Roeder, a professor of civil and environmental engineering at the University of Washington.

While the I-5 truck\'s cargo suffered only minimal damage, it left chaos in its wake, with two vehicles catapulting off the edge of the broken bridge into the river below. Three people involved escaped with non-life threatening injuries.

The most famous failure of a fracture critical bridge was the collapse of the I-35W bridge in Minneapolis during rush hour on Aug. 1, 2007, killing 13 people and injuring more than 100 others. The National Transportation Safety Board concluded that the cause of the collapse was an error by the bridge\'s designers — a gusset plate, a key component of the bridge, was too thin. The plate was only half of the required one-inch thickness.

Because the bridge\'s key structures lacked redundancy, where if one piece fails, there is another piece to prevent the bridge from falling, when the gusset plate broke, much of the bridge collapsed.

Mark Rosenker, who was chairman of the NTSB during the I-35W bridge investigation, said the board looked into whether other fracture critical bridges were collapsing. They found a few cases, but not many, he said.

\"Today, they\'re still building fracture critical bridges with the belief that they\'re not going break,\" Rosenker said.

Fracture critical bridges, like the I-5 span in Washington, are the result of Congress trying to cut corners to save money rather than a lack of engineering know-how, said Barry B. LePatner, a New York real estate attorney and author of \"Too Big to Fall: America\'s Failing Infrastructure and the Way Forward.\"

About 18,000 fracture critical bridges were built from the mid-1950s through the late 1970s in an effort to complete the nation\'s interstate highway system, which was launched under President Dwight Eisenhower, LePatner said in an interview. The fracture critical bridge designs were cheaper than bridges designed with redundancy, he said.

Thousands of those bridges remain in use, according to an AP analysis.

\"They have been left hanging with little maintenance for four decades now,\" he said. \"There is little political will and less political leadership to commit the tens of billions of dollars needed\" to fix them.

There has been little focus or urgency in specifically replacing the older \"fracture critical\" crossings, in part because there is a massive backlog of bridge repair work for thousands of bridges deemed to be structurally problematic. Washington state Rep. Judy Clibborn, a Democrat who leads the House transportation committee, has been trying to build support for a tax package to pay for major transportation projects in the state. But her plan wouldn\'t have done anything to revamp the bridge that collapsed.

National bridge records say the I-5 crossing over the Skagit River had a sufficiency rating of 57.4 out of 100 — a score designed to gauge the ability of the bridge to remain in service. To qualify for federal replacement funds, a bridge must have a rating of 50 or below. A bridge must have a sufficiency rating of 80 or below to qualify for federal rehabilitation funding.

Hundreds of bridges in Washington state have worse ratings than the one that collapsed, and many around the country have single-digit ratings.

Clibborn said the Skagit River crossing wasn\'t even on the radar of lawmakers because state officials have to prioritize by focusing on bridges with serious structural problems that are at higher risk of imminent danger.

Along with being at risk of a fatal impact, the I-5 bridge was deemed to be \"functionally obsolete,\" which essentially means it wasn\'t built to today\'s standards. Its shoulders were narrow, and it had low clearance.

There are 66,749 structurally deficient bridges and 84,748 functionally obsolete bridges in the U.S., including Puerto Rico, according to the Federal Highway Administration. That\'s about a quarter of the 607,000 total bridges nationally. States and cities have been whittling down that backlog, but slowly. In 2002, about 30 percent of bridges fell into one of those two categories.

Spending by states and local government on bridge construction adjusted for inflation has more than doubled since 1998, from $12.3 billion to $28.5 billion last year, according to the American Road and Transportation Builders Association. That\'s an all-time high.

\"The needs are so great that even with the growth we\'ve had in the investment level, it\'s barely moving the needle in terms of moving bridges off these lists,\" said Alison Premo Black, the association\'s chief economist.

There is wide recognition at all levels of government that the failure to address aging infrastructure will likely undermine safety and hinder economic growth. But there is no consensus on how to pay for improvements. The federal Highway Trust Fund, which provides construction aid to states, is forecast to go broke next year. The fund gets its revenue primarily from federal gas and diesel taxes. But revenues aren\'t keeping up because people are driving less and there are more fuel-efficient cars on the road.

Neither Congress nor the White House has shown any willingness to raise federal gas taxes, which haven\'t been increased since 1993. Many transportation thinkers believe a shift to taxes based on miles traveled by a vehicle is inevitable, but there are privacy concerns and other difficulties that would preclude widespread use of such a system for at least a decade.

Transportation spending got a temporary boost with the economic stimulus funds approved by Congress after President Barack Obama was elected. Of the $27 billion designated for highway projects under the stimulus program, about $3 billion went to bridge projects, Black said.

States are looking for other means to raise money for highway and bridge improvements, including more road tolls, dedicating a portion of sales taxes to transportation and raising state gas taxes. Clibborn, the Washington state lawmaker, has proposed a 10-cent gas hike to help pay for projects, though the effort has been held up by a dispute over how to rebuild the Columbia River bridge connecting Vancouver, Wash., and Portland, Ore.

\"We can\'t possibly do it all in the next 10 years,\" Clibborn said. \"But we\'re going to do the first bite of the apple.\"

___

Lowy reported from Washington, D.C. AP Writers Manuel Valdes and Gene Johnson contributed to this report.

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', this, event, '150px')">Thousands Of Bridges Are One Freak Accident Away From Collapse (1 hour ago)

And indeed while US equities remain within a hair of all-time highs, and inflows into stocks spike, there\'s been a big decrease in money going into commodity funds.

This chart from Jefferies tells the story:

Commodity funds continued to experience significant net outflow. The latest amount of net outflow stood at a net US$2.1bn. Recent 15 consecutive weekly outflows totalled a net US$23bn. YTD net withdrawals cumulated to U$24bn. Commodity funds saw net inflows of US$17bn for the full year in 2012. This is the fourth yearly inflow while the total amount of injections in 2012 topped the four-year period.

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', this, event, '150px')">In One Chart, Here's How Investors Are Massively Giving Up On Commodities (3 hours ago)
We can isolate the effect of demographics on the LFPR by looking at the participation rates by age cohort. The aggregate LFPR is equal to the summation of each individual age cohort\'s LFPR weighted by its share of the population. As a result, we can determine the impact of the change in population share by fixing the LFPR for each age cohort at pre-recession levels. This suggests that half of the 2.7pp decline in the LFPR since the onset of the recession can be explained simply from the aging population. In other words, holding all else equal – meaning no business cycle dynamics – the LFPR would be at 64.6% today compared to the actual rate of 63.3%. The remaining 1.4pp drop is due to somecombination of secular and short-term cyclical factors.

Here\'s a chart showing actual Labor Force Participation Rate vs. the projected rate merely based on demographic changes.

The remaining gap is partly due to the weak economy (people giving up) and partly due to other secular factors, such as young people being more inclined to be in shool and not work.

Long-term, here\'s what BofAML expects based on demographics.

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', this, event, '150px')">BofA's Michelle Meyer On The Mass Exodus From The US Workforce That Will Continue For Decades (4 hours ago)

Our colleagues had a lot to say, from how important it is to take care of your finances to not worrying about the first five years after graduation (you read that correctly: the first five years aren\'t all that important, according to SAI Senior Editor Jay Yarow). 

But advice is all relative.

As Politics Reporter Walter Hickey says, \"Ignore all the advice. Statistics insist.\"

Alyson Shontell, Senior Reporter, SAI

\"Join a startup when you graduate run by seasoned, smart founders. In an ideal world, you\'ll pick one that will grow far bigger than it is when you join it. Either way, you will get tremendous experience and get to try your hand at a number of different roles, which can help you decide what you actually want to do with your life. And if the company grows, your career can grow with it.\"

Steve Kovach, SAI Editor

\"My advice is to not settle. There\'s a good chance your first job will be something you hate. If that\'s the case, don\'t stop looking until you land somewhere you can see yourself working for several years.\"

Alex Davies, Transportation Reporter

\"Leave the country for at least a year. Chances are you can find a job in Europe, South America, or Asia teaching English.

You\'ll have a good time, and won\'t have to worry about a career for a year. When you come back you will seem more interesting to everyone, including potential employers.

It\'s not like you\'ll be missing out on a booming economy, either, and none of the people in my graduating class who left the country for a year had more trouble than usual finding a job upon their return.\"

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', this, event, '150px')">20 Business Insider Staffers Share Their Best Advice For College Grads (10 hours ago)
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', this, event, '150px')">Behavioral Biases Are Creating Opportunities For Investors Who Defy The Crowd (12 hours ago)
see discussion). Many weren\'t even talking about a possible recession. And now they are continually downgrading their predictions - after the fact?

Today we got the latest PMI numbers from the Eurozone. France is clearly struggling and Germany\'s growth has been slower than many had hoped - due primarily to global economic weakness. But take a look at the rest of the Eurozone. While still in contraction mode, it shows an improving trend.

Spain printed a trade surplus last month (surprising some commentators), which may be a signal to rethink how valid some of these forecasts really are. Nobody is suggesting we will see Spain or Portugal all of a sudden begin to grow at 5%. But given the extremely pessimistic sentiment of many economists (a contrarian indicator), it is highly possible we are at or near the bottom of the cycle. People should not be surprised if we start seeing some positive growth indicators - especially in the periphery nations - in the next few quarters.

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', this, event, '150px')">Europe May Finally Be In A Position To Surprise Economists To The Upside (14 hours ago)
AAR:

“The Association of American Railroads (AAR) reported an increase in traffic for the week ending May 18, 2013, with total U.S. weekly carloads of 285,679 carloads, up 1.9 percent compared with the same week last year. Intermodal volume for the week totaled 250,156 units, up 3.5 percent compared with the same week last year. Total U.S. traffic for the week was 535,835 carloads and intermodal units, up 2.6 percent compared with the same week last year.

Five of the 10 carload commodity groups posted increases compared with the same week in 2012, led by petroleum and petroleum products, up 38 percent. Commodities showing a decrease compared with the same week last year included grain, down 28.3 percent, and metallic ores and metals, down 7.1 percent.

For the first 20 weeks of 2013, U.S. railroads reported cumulative volume of 5,530,177 carloads, down 1.7 percent from the same point last year, and 4,791,035 intermodal units, up 4.3 percent from last year. Total U.S. traffic for the first 20 weeks of 2013 was 10,321,212 carloads and intermodal units, up 1 percent from last year.”

Chart via Orcam Investment Research:

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', this, event, '150px')">Rail Traffic Confirms That The Economy Remains Sluggish (14 hours ago)
NYXdata website, where we can also find historical data back to 1959. Let\'s examine the numbers and study the relationship between margin debt and the market, using the S&P 500 as the surrogate for the latter.

The first chart shows the two series in real terms — adjusted for inflation to today\'s dollar using the Consumer Price Index as the deflator. I picked 1995 as an arbitrary start date. We were well into the Boomer Bull Market that began in 1982 and approaching the start of the Tech Bubble that shaped investor sentiment during the second half of the decade. The astonishing surge in leverage in late 1999 peaked in March 2000, the same month that the S&P 500 hit its real all-time high. A similar surge began in 2006, peaking in July, 2007, three months before the market peak.

 

Click for a larger image

 

The next chart shows the percentage growth of the two data series from the same 1995 starting date, again based on real (inflation-adjusted) data. Margin debt grew at a rate comparable to the market from 1995 to late summer of 2000 before soaring into the stratosphere. The two synchronized in their rate of contraction in early 2001. But with recovery after the Tech Crash, margin debt gradually returned to a growth rate closer to its former self in the second half of the 1990s rather than the more restrained real growth of the S&P 500. But by September of 2006, margin again went ballistic. It finally peaked in the summer of 2007, about three months before the market.

 

Click for a larger image

 

After the market low of 2009, margin debt again went on a tear until the contraction in late spring of 2010. The summer doldrums promptly ended when Chairman Bernanke hinted of more quantitative easing in his August, 2010 Jackson Hole speech. The appetite for margin instantly returned, and the Fed has periodically increased the easing.

Unfortunately, the NYSE margin debt data is a few weeks old when it is published. In nominal terms, margin debt at the end of April 2013, the latest available data, has sharply increased since the middle of last year and is now approaching levels associated with market peaks.

NYSE Investor Credit

Lance Roberts, General Partner & CEO of Streettalk Advisors, analyzes margin debt in the larger context that includes free cash accounts and credit balances in margin accounts. Essentially, he calculates the Credit Balance as the sum of Free Credit Cash Accounts and Credit Balances in Margin Accounts minus Margin Debt. The chart below illustrates the mathematics of Credit Balance with an overlay of the S&P 500. Note that the chart below is based on nominal data, not adjusted for inflation.

 

Click for a larger image

 

As I pointed out above, the NYSE margin debt data is a several weeks old when it is published. Thus, even though it may in theory be a leading indicator, a major shift in margin debt isn\'t be immediately evident. Nevertheless, we see that the troughs in the monthly net credit balance preceded peaks in the monthly S&P 500 closes by six months in 2000 and four months in 2007. The most recent S&P 500 correction greater than 10% was the 19.39% selloff in 2011 from April 29th to October 3rd. Investor Credit hit a negative extreme in March 2011.

There are too few peak/trough episodes in in this overlay series to take the latest credit-balance trough as a definitive warning for U.S. equities. But we\'ll want to keep an eye on this metric over the next few months.

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', this, event, '150px')">Investors Are Borrowing Like Crazy To Leverage Up Their Stock Market Bets (15 hours ago)
world\'s largest producer and consumer of coal. Coal has contributed to China\'s pollution problem. And the coal mines are said to be the deadliest in the world, killing thousands of miners a year.

To combat the recent slump in coal prices, the coal industry is said to have asked the government to restrict coal imports to China through quality control. Some argue that the slump is being driven not by oversupply, but because of a lack of demand.

But with China continuing to industrialize at a rapid pace, the importance of coal is unlikely to diminish in the coming years.

China is the world\'s largest energy consumer.

Source: Goldman Sachs

It accounts for 21% of global energy use.

Source: Goldman Sachs

China is also the world\'s largest coal producer, accounting for over 40% of global coal production.

Source: Global Times

 

 

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', this, event, '150px')">Disturbing Photos Of China's Deadly Coal Mines (15 hours ago)


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SeaWorld Entertainment?s Antarctica: Empire of the Penguin attraction, opening today at the company?s namesake theme park in Orlando, features 50-foot glaciers, 2,500 glass icicles and up-close encounters with 230 penguins, dusted daily with 6,000 pounds of snow. ?It is the coolest attraction in the world,? President and Chief Executive Officer Jim Atchison said in an…

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', this, event, '150px')">From Now On Goldman Will Only Sell A Product To Clients If Some Goldman Partners Understand It (1 day ago)

Henry Kravis patiently waiting for some Chipotle in midtown this afternoon. It appears that someone has had it with assistants who apparently need “half black, half pinto” tattooed to their wrist.

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In Bid for Clarity, Fed Delivers Opacity (WSJ) As the Fed has tried to explain its thinking, investors have sometimes been caught scratching their heads. Wednesday’s stock-market moves put that dynamic into sharp relief. Stock prices soared in the morning when Mr. Bernanke initially sounded reluctant to start reducing the size of the monthly bond…

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In spite of an infinitely more direct approach, Bernanke has explained that the Fed reserves the right to increase or decrease the pace of bond purchases. More recently, there has even been speculation that the Fed would stop printing money sooner and/or change the unemployment target to 7.0%. It follows that, in the quest to be more transparent, Fed Speak is as maddening as ever. Investors do not know what the Fed will actually do because they themselves reserve the right to change on the fly. (The positive spin for the right to change one\'s mind is called, \"flexibility.\") ...

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The FDIC Claims an IndyMac Victory (166 days ago)


Market Folly

doubt yourself [WSJ] Jelisavcic: This is an optimal time to invest in distressed debt [FINalternatives] Are corporate profit margins abnormally elevated or sustainable? [Greenbackd] Don\'t just do something, sit there [The Economist] Steve Romick: trade into the gold you can eat, farmland [Forbes] Why investors can\'t imagine a collapse of the bond market [WSJ] Telecom\'s big players hold back the future [NYTimes] Investor sentiment: fear and greed index [CNNMoney] Hedge fund leverage approaches all-time high [ai-CIO] National Bank (NBHC) on the prowl [Barrons] Why Alibaba could be China\'s next big IPO [Reuters] Anatomy of the 10-K [Wall Street Oasis] How the SEC\'s marketing rules shortchange investors [ii alpha] Is the asset management business set for consolidation? [Citywire] Warren Buffett is bullish on women [CNN Money] If MBAs are useless, we\'re all in big trouble [Quartz] Ron Johnson\'s 5 key mistakes at J.C. Penney [Fast Company] ', this, event, '150px')">What We're Reading ~ Analytical Links 5/22/13 (3 days ago)
brand new issue of our Hedge Fund Wisdom newsletter that was just released yesterday. Per Google Finance, Intuitive Surgical is \"designs, manufactures and markets da Vinci Surgical Systems and related instruments and accessories. A da Vinci Surgical System consists of a surgeon?s console, a patient-side cart and a high performance vision system. The da Vinci Surgical System translates a surgeon?s natural hand movements, which are performed on instrument controls at a console, into corresponding micro-movements of instruments positioned inside the patient through small incisions, or ports. The da Vinci Surgical System is designed to provide its operating surgeon with intuitive control, range of motion, fine tissue manipulation capability and three dimensional (3-D), high-definition (HD) vision while simultaneously allowing the surgeon to work through the small ports of MIS.\" For more resources on this fund, we\'ve also posted up a rare interview with Andreas Halvorsen. ', this, event, '150px')">Viking Global Increases Intuitive Surgical (ISRG) Position (4 days ago)
brand new issue of our premium newsletter that just came out yesterday. Per Google Finance, Carter\'s is \"a branded marketer of apparel for babies and young children in the United States. The Company owns two brand names in the children?s apparel industry, Carter?s and OshKosh. Its Carter?s brand provides apparel for children sizes ranging from newborn to seven. OshKosh brand provides its line of apparel for children sizes newborn to 12. Its Carter?s, OshKosh, and related brands are sold to national department stores, chain and specialty stores and discount retailers.\" ', this, event, '150px')">Tiger Global Boosts Carter's (CRI) Stake (4 days ago)
Glenview\'s thesis on hospitals a year ago.  That trade has performed extremely well, as THC is up over 120% since then. As noted in our post on 2013 Q1 hedge fund performance, Glenview was up 17.94% at the end of the first quarter.  And this comes on top of a big 2012 where they returned 29% before fees.  Their basket bet on hospital stocks is a big reason why (and especially Tenet, their largest wager of the group). And while Robbins\' firm has sold some Tenet shares, we highlighted how Glenview recently added to another hospital play. Per Google Finance, Tenet Healthcare is \"an investor-owned health care services company whose subsidiaries and affiliates own and operate acute care hospitals, ambulatory surgery centers, diagnostic imaging centers and related health care facilities. Its core business is focused on providing acute care treatment, including inpatient care, intensive care, cardiac care, radiology services and emergency medical treatment, as well as outpatient services.\" You can view the rest of Glenview\'s portfolio in our Hedge Fund Wisdom newsletter (new Q1 issue available now). ', this, event, '150px')">Larry Robbins' Glenview Capital Trims Tenet Healthcare (THC) Stake (4 days ago)
www.hedgefundwisdom.com to download it. In The New Issue - Equity analysis of 3 stocks top hedge funds are buying:  Written by hedge fund analysts, this section quickly brings you up to speed on a company and the latest situation, summarizing the investment thesis.  If you missed it, we recently looked at the performance of stocks analyzed in past HFW issues and the numbers are pretty solid. See which 3 stocks are analyzed in the new issue by subscribing below! - Brand new consensus buy/sell section:  Top 5 new buys, top 5 sells, top 5 additions, top 5 reductions.  Each list shows the most popular stocks hedge funds were trading and provides commentary on why they were buying/selling. - Newly updated portfolios of 25 top hedge funds: See the latest holdings of Seth Klarman, David Tepper, Steve Mandel, David Einhorn, John Paulson, Chase Coleman and many more big names. - Expert commentary on each fund\'s moves: We put each fund\'s activity into context.  We\'ve been tracking these funds for 6+ years. - 1 convenient document: All the important information aggregated to save you time. See What Stocks Hedge Funds Have Been Buying, Subscribe Below 1-Year Subscription (save 20% with this choice): $299.99 per year Quarterly Subscription: $89.99 per quarter Want to pay by check?  Email us: info@hedgefundwisdom.com ', this, event, '150px')">New Hedge Fund Wisdom Issue Now Available (4 days ago)
Lee Cooperman recently shared his market thoughts at the Skybridge Alternatives Conference (SALT). Bridger Capital\'s Position in PFSI Roberto Mignone\'s hedge fund Bridger Capital also filed a 13G with the SEC and disclosed a 13.5% ownership stake in the company with 1,500,000 shares due to activity on May 9th as well. About PennyMac Financial Services PennyMac Financial Services recently went public and is the parent firm to publicly traded subsidiary PennyMac Mortgage Investment Trust (PMT). Per Google Finance, PennyMac Financial Services, Inc. is \"a specialty financial services firm with a mortgage platform and integrated business focused on the production and servicing of United States residential mortgage loans and the management of investments related to the United States residential mortgage market. The Company operates in two segments: mortgage banking and investment management. Its principal mortgage banking subsidiary, PennyMac Loan Services, LLC (PLS), is a non-bank producer and servicer of mortgage loans in the United States. PLS is a seller/servicer for the Federal National Mortgage Association (Fannie Mae), and the Federal Home Loan Mortgage Corporation (Freddie Mac), each of which is a government-sponsored entity (GSE). The Company?s principal investment management subsidiary, PNMAC Capital Management, LLC (PCM), is an investment adviser. It manages PennyMac Mortgage Investment Trust (PMT), a mortgage real estate investment trust (REIT).\" ', this, event, '150px')">Omega Advisors and Bridger Capital Disclose Stakes in PennyMac Financial Services (5 days ago)
they owned at the end of April. The new disclosure was required due to portfolio activity on May 14th. Hedge fund Hayman Capital also owns a large stake in DXM and founder Kyle Bass presented the case on Dex Media at the recent Ira Sohn Conference. Dex Media is the combination of the former Dex One (former ticker DEXO) and Super Media (former ticker SPMD) entities.  They recently merged and reorganized. Per Yahoo Finance, Dex Media \"engages in the publication and marketing of directories, which include Yellow Pages and White Pages in the United States. The company also offers Internet-based telephone directory and database marketing services.\"  ', this, event, '150px')">Paulson & Co Adds to Dex Media Stake (5 days ago)
Soros Fund\'s new position. ', this, event, '150px')">Soros Fund Adds to Johnson Services Stake (5 days ago)
Hedge Fund Wisdom.  It reveals the portfolios of 25 top hedge funds, provides hedgie consensus buy/sell lists, and features an equity analysis section written by hedge fund analysts.  (If you haven\'t seen it, check out a free sample here). The brand new Q1 2013 issue of HFW will be released next week (May 21st), but in the mean time we wanted to update everyone on the performance of the stocks analyzed in past issues.  (After all, the newsletter has been running for almost 3 years now).  Performance of Stocks From Past Issues Each HFW issue features an equity analysis section and all numbers herein assume each stock was purchased when each issue of the newsletter was released and held until present day (5/15/13).  The numbers are pretty impressive.  Here are some stats: - 36 stocks profiled through all issues thus far - 26 of these stocks have outperformed the S&P 500 - Average performance across all stocks profiled = +51.2% - Average performance of S&P 500 = +28.5% - Average outperformance over S&P 500 = +22.7% - The 26 outperforming stocks beat the S&P by an average of +41.2% - 4 stocks have more than doubled (+177%, +156%, +148%, +137%) - 5 other stocks have each almost doubled (+97%, +92%, +91%, +87%, +84%) - Only 10 stocks underperformed the S&P (and only 1 had a negative return: -3.1%) Quarterly Breakdown of Performance  Here\'s a quarterly breakdown starting with the most recent issue and working backwards: Q4 2012 Issue: 3 out of 3 Outperformed (February 2013 - Present) Spirit AeroSystems (SPR): +32.3% Herbalife (HLF): +18.5% Capital One (COF): +15.0% S&P 500: +9.8% Q3 2012 Issue: 2 out of 2 Outperformed (November 2012 - Present) B/E Aerospace (BEAV): +45.4% Ocwen Financial (OCN): +24.4% S&P 500: +19.3% Q2 2012 Issue: 1 out of 3 Outperformed (August 2012 - Present) AIG (AIG): +35.9% VeriSign (VRSN): +2.9% Textron (TXT): +2.5% S&P 500: +17.4% Q1 2012 Issue: 1 out of 3 Outperformed (May 2012 - Present) Equinix (EQIX): +47.7% AutoZone (AZO): +15.8% TempurPedic (TPX) Short: -0.82% S&P 500: +25.9% Q4 2011 Issue: 2 out of 2 Outperformed (February 2012 - Present) United Rentals (URI): +44.3% Priceline.com (PCLN): +38.3% S&P 500: +21.9% Q3 2011 Issue: 3 out of 3 Outperformed (November 2011 - Present) Netflix (NFLX): +177.4% Visa (V): +91.0% Lowe\'s (LOW): +87.1% S&P 500: +31.3% Q2 2011 Issue: 2 out of 3 Outperformed (August 2011 - Present) AIG (AIG): +97.1% Sensata Technologies (ST): +4.5% First Solar (FSLR) Short: -51.9% S&P 500: +40.7% Q1 2011 Issue: 3 out of 5 Outperformed (May 2011 - Present) Expedia (EXPE): +156.7% (doesn\'t include TripAdvisor (TRIP) spin-off either) Seagate Technology (STX): +136.9% Yahoo (YHOO): +65.2% MetLife (MET): -3.08% Best Buy (BBY) Short: -18.3% S&P 500: +24.0% Q4 2010 Issue: 4 out of 4 Outperformed (February 2011 - Present) The Gap (GPS): +91.7% Blackrock (BLK): +42.2% Williams Companies (WMB): +36.1% Coinstar (CSTR): +28.6% S&P 500: +24.8% Q3 2010 Issue: 4 out of 6 Outperformed (November 2010 - Present) Sirius XM Radio (SIRI): +148.6% Aon (AON): +61.8% CareFusion (CFN):+45.8% Express Scripts (ESRX): +17.5% Cisco Systems (CSCO): +5.3% Alcon (ACL): Bought out S&P 500: +38.3% Q2 2010 Issue: 1 out of 3 Outperformed (August 2010 - Present) American Tower (AMT): +84.3% Ensco (ESV): +40.9% Citigroup (C): +32.3% S&P 500: +53.7% Sign Up For Next Week\'s New Issue To see what stocks will be analyzed in next week\'s new issue of Hedge Fund Wisdom, click here to subscribe. ', this, event, '150px')">Performance of Stocks Analyzed in Past Hedge Fund Wisdom Issues (10 days ago)
new book: Shareholder Yield [Meb Faber] Explanation of Tepper\'s chart: Equity risk premium is high (this is bullish) [The Big Picture] On confirmation bias and the perma-whatevers [Abnormal Returns] The end is where we start from [Reformed Broker] On emotional finance [Research Puzzle] What record profit margins imply for future profitability and the market [Greenbackd] It\'s time to fight the Fed [MicroFundy] The low return of high yield [Contrarian Corner] Missed Visa and Mastercard? Then keep an eye on this one: Fleetcor (FLT) [Old School Value] The bull case on Hospira (HSP) [Forbes] An overview of a hedge fund favorite: Dollar Tree (DLTR) [Aegaia Research] Time to change the channel on media stocks [CNBC] On the \'spying\' Bloomberg terminals [CNBC] Will Wall Street\'s Bloomberg terminal addiction break? [NYMag] Steelmakers develop new iron recipes [WSJ] Thoughts on a potential Verizon & Vodafone deal [VODVZ] Two strategies: The Washington Post vs the NYTimes [Monday Note] Forget gold, the gourmet cupcake market is crashing [WSJ] ', this, event, '150px')">What We're Reading ~ Analytical Links 5/15/13 (10 days ago)


Bespoke

', this, event, '150px')">A So-So Week for Earnings (1 day ago)

', this, event, '150px')">AAII Bullish Sentiment Approaches 50% (3 days ago)

', this, event, '150px')">Jobless Claims Better Than Expected (3 days ago)

', this, event, '150px')">Jobless Claims Lower Than Expected (3 days ago)
Bloomberg), including where they are now and where they were on January 1st.  Price targets shaded in green have been increased since the start of the year.

As shown, even with increases from 8 strategists, the average year-end S&P 500 price target is currently at 1,612, which is actually 2.49% below the index\'s current level.  Only 5 of the 14 strategists are bullish on the index for the remainder of the year, while 9 are bearish.  Goldman Sachs has the most bullish year-end target at 1,750, followed by Oppenheimer (1,730), JP Morgan (1,715) and Stifel Nicolaus (1,700).  Wells Fargo is the most bearish on the index with a year-end target of just 1,390.  This is 15.91% below where the index is currently trading.  UBS is the second-most bearish with a target of 1,425, while Barclays is the third-most bearish at 1,525.

', this, event, '150px')">Wall Street Strategist Year-End S&P 500 Price Targets (3 days ago)

', this, event, '150px')">Technology Loses Share; Financials, Health Care Gain (3 days ago)
US sector weightings, and below we take a look at the percentage of total world stock market cap that the largest countries make up.  As shown below, the US and Japan, which were the two largest stock markets at the start of the year, have added to their percentage of world market cap so far this year at the expense of pretty much everyone else.  

The US has already gained more than two full percentage points in 2013, jumping from 32.14% of total world stock market cap up to 34.17%.  Japan is a distant second at a current level of 7.90%, but the country has seen its share jump 0.96 percentage points on the back of huge stock market gains.

The countries that have lost the biggest share of world market cap so far this year include Hong Kong, Canada, India, South Korea, Russia and the UK.

', this, event, '150px')">US, Japan Gain on Rest of World in 2013 (3 days ago)

', this, event, '150px')">Energy Inventories Higher Than Expected (3 days ago)

', this, event, '150px')">The Dark Ages of Bernanke's Tenure (3 days ago)

', this, event, '150px')">The Fed Minutes Freakout (4 days ago)


Yahoo! M&A

By Ronald Grover and Greg Roumeliotis LOS ANGELES/NEW YORK (Reuters) - Yahoo Inc (YHOO.O) has submitted a formal proposal to buy Hulu, joining a growing list of bidders for the video service owned by News ...

', this, event, '150px')">Yahoo joins growing list of bidders for Hulu: sources (1 day ago)
', this, event, '150px')">Schumer urges look at security in Sprint deal (1 day ago)
Google eyes Waze as Facebook circles hot Web maps property (1 day ago)
Office Depot, OfficeMax tap Boston Consulting (1 day ago)
SolarWinds Set to Buy N-able (1 day ago)
Royalty Pharma offer for Elan gets little support (1 day ago)
DISH Adds Fifth Bank for Sprint Deal (1 day ago)
Marsh & McLennan Buys Peru Insurer (1 day ago)
BlackRock Remains Neutral (1 day ago)
Google Considers Outbidding Facebook To Buy Waze For ~$1 Billion ? Report (2 days ago)
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