“European wheat and rapeseed crops are at risk of drought that may further hurt yields after freezing weather last month destroyed some fields, analysts and forecasters said.
France, Spain, England and northern Italy got less rain than normal since the start of January, European Union weather data show. They will probably stay drier and warmer than usual in the next 30 days, said Joel Burgio, an agricultural meteorologist at Telvent DTN.
The 27-nation EU typically grows about 20 percent of the world’s soft wheat. A cold wave in February may have lopped 5 million metric tons off this year’s harvest, and a lack of rain might further harm EU output, according to Alexandre Marie, an analyst at French farm adviser Offre et Demande Agricole.
“The situation in Europe is alarming,” Marie said by phone yesterday from Bourges, west of Paris. “That will remain a factor of support for the market in coming weeks.”
Paris-traded milling wheat for November delivery was priced above the grain for December delivery in Chicago for the first time in the contracts’ lifetime on Feb. 7. Buyers now need to pay $14.29 a ton more for French wheat.
“We’re already starting to see a market reaction,” Marie said. European wheat has gained on U.S. grain because of concern about frost damage to the crop, and drought is an additional risk, he said.
Less Than Average
Rainfall in northern France, England and the north of Italy this year was 23 percent to 47 percent below the long-term average, data from the EU’s Monitoring Agricultural Resources unit show. In Spain and France’s Mediterranean region, amounts were 59 percent to 78 percent lower….”Comments »
“Signs that crude futures may hit much higher levels are converging, say oil traders and analysts, some of whom predict that Brent [LCOCV1 124.22 0.10 (+0.08%) ] crude could reach $200 a barrel within the next 12 months.
Mark Lennihan / AP
The biggest issue, they say, is that global crude supply remains uncommonly tight — a scenario that’s unlikely to be alleviated any time soon.
Even though Libya’s oil has largely returned online after the political disruptions that took it off the market last year, and Saudi Arabia is generating its highest output in three decades, the available crude is just barely meeting demand. The summer driving season in the U.S., which begins in April, could put further pressure on prices.
The cash, or physical price, of crude — which refers to what’s paid for the commodity when it’s shipped from a producer to a buyer — has largely exceeded the price of Brent futures since mid-February (a situation referred to in oil trading as “backwardation.”).
The effect on the home front is already being felt: In the U.S., gas prices are at $3.86 per gallon, according to OPIS, a stone’s throw from the $4 mark that created big concerns last year.
Still, it’s unclear that releasing oil from the Strategic Petroleum Reserve, a maneuver the White House made last June 23 in hopes of easing prices at the pump, will be much of a fix.
Gas prices were roughly $3.60 when the drawdown occurred, and were depressed for only a few days before climbing back over $3.70 a month later. Because of that, many traders tend to dismiss the recent chatter in Washington about releasing more oil from the SPR as bad politics.
“The seaborne oil market is extremely tight,” says one bullish hedgie. “As much as the politicians love blaming speculators, if the market was up on speculation and not fundaments, the physical market would be trading at a discount.”
Goldman Sachs [GS 126.07 0.05 (+0.04%) ] commodities analysts agree with him, at least on the first part.
“We expect fundamentals will continue to tighten during 2012,” the firm said in a March 14 report, “pushing prices toward our 2013 Brent crude oil price target of $130 [per barrel]. With OPEC spare capacity and inventories low, the balance of risk to crude oil prices remains skewed to the upside.”Comments »
“SAO PAULO (AP) — Seventeen oil company executives face probable criminal charges Wednesday for an oil leak in the Atlantic, a legal action that has prompted debate about whether it could slow Brazil’s effort to develop its massive offshore finds.
At least 110,000 gallons (416,000 liters) of oil seeped through cracks on the ocean floor near a Chevron Corp. appraisal well off the Rio de Janeiro coast in November. The well drilled byTransocean Ltd. has since been sealed, but a small amount of seepage reappeared in recent days, raising concern the damage is not yet over.
Paulo Alexandre Ferreira, a spokesman for the federal prosecutors’ office in Rio de Janeiro state, said the charges “most likely” will be put before courts on Wednesday. A judge will then decide if the executives will face trial, which would be a lengthy process given the number of defendants, the complexity of the case and the Brazilian legal system’s room for numerous appeals….”Comments »
“If you’ve been fretting about faltering math education and falling test scores here in the United States, you should be worried based on this campaign season of Republican math. When it comes to the American military, the leading Republican presidential candidates evidently only learned to add and multiply, never subtract or divide.
Advocates of Pentagon reform have criticized President Obama for his timid approach to reducing military spending. Despite current Pentagon budgets that have hovered at the highest levels since World War II and 13 years of steady growth, the administration’s latest plans would only reduce spending at the Department of Defense by 1.6% in inflation-adjusted dollars over the next five years.
Still, compared to his main Republican opponents, Obama is a T. rex of budget slashers. After all, despite their stated commitment to reducing the deficit (while cutting taxes on the rich yet more), the Republican contenders are intent on raising Pentagon spending dramatically. Mitt Romney has staked out the “high ground” in the latest round of Republican math with a proposal to set Pentagon spending at 4% of the Gross Domestic Product (GDP). That would, in fact add up to an astonishing $8.3 trillion dollars over the next decade, one-third more than current, already bloated Pentagon plans.
Nathan Hodge of the Wall Street Journal engaged in polite understatement when he described the Romney plan as “the most optimistic forecast U.S. defense manufacturers have heard in months.”
In fact, Romney’s proposal implies that the Pentagon is essentially an entitlement program that should receive a set share of our total economic resources regardless of what’s happening here at home or elsewhere on the planet. In Romney World, the Pentagon’s only role would be to engorge itself. If the GDP were to drop, it’s unlikely that, as president, he would reduce Pentagon spending accordingly.
Rick Santorum has spent far less time describing his military spending plans, but a remark at a Republican presidential debate in Arizona suggests that he is at least on the same page with Romney. In 1958, the year he was born, Santorum pointed out, Pentagon spending was 60% of the federal budget, and now it’s “only” 17%. In other words, why cut military spending when it’s so comparatively low?
Of course, this is a classic bait-and-switch case of cherry-picking numbers, since the federal budget of 1958 didn’t include Medicare, Medicaid, theEnvironmental Protection Agency, or the Occupational Safety and Health Administration. The population was 100 million less than it is now, resulting in lower spending across the board, most notably for Social Security. In fact, Americans now pay out nearly twice as much for military purposes as in 1958, a sum well in excess of the combined military budgets of the next 10 largest spending nations.
Of course, in a field of innumerates, Santorum’s claim undoubtedly falls into the category of rhetorical flourish. It’s unlikely that even he was suggesting we more than triple Pentagon spending — the only way to return it to the share of the budget it consumed in the halcyon days of his youth. (Keep in mind that profligate Pentagon spending in that era ultimately prompted President Dwight D. Eisenhower to coin the term “military-industrial complex.”) Still, Santorum clearly believes that there’s plenty of room to hike military spending, if we just slash genuine entitlement programs deeply enough. He would undoubtedly support a Pentagon budget at Romney-esque levels, as would Newt Gingrich based on his absurd claim that the Obama administration’s modest adjustments to the Pentagon’s record budgets would result in a “hollowing out” of the U.S. military.
Mitt Romney at Sea
But let’s stick with the Republican frontrunner (or stumbler). What exactly would Romney spend all this money on?
For starters, he’s a humongous fan of building big ships, generally the most expensive items in the Pentagon budget. He has pledged to up Navy ship purchases from 9 to 15 per year, a rise of 50%. These things add up. A new aircraft carrier costs more than $10 billion; a ballistic missile submarine weighs in at $7 billion or more; and a destroyer comes with a — by comparison — piddling price tag of $2 billion-plus. The rationale for such a naval spending spree is, of course, that all-purpose threat cited these days by builders of every sort of big-ticket military hardware: China.
As Romney put it late last year, if the U.S. doesn’t pump up its shipbuilding budget, China will soon be “brushing aside an inferior American Navy in the Pacific.” This must be news to former Secretary of Defense Robert Gates, who noted in a May 2010 speech to the Navy League that the fleet is larger than the next 13 navies combined — 11 of which, by the way, belong to U.S. allies. As for the Chinese challenge, much has been made of China’s new aircraft carrier, which actually turns out to be a refurbished vessel purchased from Ukraine in 1998 and originally intended to be a floating casino. It would leave the U.S. with only an 11 to 1advantage in this category.
It’s true that China is increasing the size of its navy in hopes of operating more freely in the waters off its coast and perhaps the contested South China Sea (with its energy reserves), but it is hardly engaged in a drive for global domination. It’s not as if Beijing is capable of deploying aircraft carriers off the coasts of California and Alaska. In the meantime, Romney’s shipbuilding fetish doesn’t add up. It’s as ludicrous as it is expensive.
Romney is also a major supporter of missile defense — and not just the current $9-$10 billion a year enterprise being funded by the Obama administration, primarily designed to blunt an attack by long-range North Korean missiles that don’t exist. Romney wants a “full, multi-layered” system. That sounds suspiciously like the Ronald Reagan-style fantasy of an “impermeable shield” over the United States against massive nuclear attack that was abandoned in the late 1980s because of its staggering expense and essential impracticality.
If the development of Romney’s high-priced version of a missile shield were again on the American agenda, it would be a godsend for big weapons-makers like Boeing, Lockheed Martin, and Raytheon, but would add nothing to the defense of this country. In fact, it stands a reasonable chance of making things worse. Given the overkill represented by the thousands of nuclear warheads in the American arsenal, the prospect of a nuclear missile attack on the United States is essentially nil.
As arms experts like Dr. Theodore Postol of the Security Studies Program at the Massachusetts Institute of Technology have pointed out, in the utterly unlikely event of a massive nuclear missile attack, Romney’s plan would bevirtually useless. There’s just no way to provide a near-perfect defense against thousands of warheads and decoys launched at 15,000 miles per hour. The only reasonable defense against nuclear weapons would be to get rid of them altogether, a course suggested by scores of retired military leaders, former defense officials, and heads of state. Even Henry Kissinger has joined the “go to zero” campaign, supporting a far more sensible approach to the nuclear dilemma than Romney’s fantasy technical fix.
The Romney anti-missile program would, however, do more than just waste money. It would restore the Bush administration’s plan to emplace a long-range anti-missile system in Europe officially aimed at Iran but assumedly capable of taking out Russian missiles as well. Given that the Obama administration’s far more limited plan for Europe has already caused consternation among Russia’s leaders, imagine the harsh reaction in Moscow to the over-the-top Romney version. It could put an end to any hopes of further U.S.-Russian nuclear reductions — a significant price to pay for a high-tech boondoggle with no prospect of success.
Ensuring a Cost-Overrun Presidency
If you were hoping that, with an eye to fighting yet more disastrous wars in the Greater Middle East like the $3 trillion fiasco in Iraq, the U.S. would raise ever larger armies, then Mitt’s your man. While Secretary of Defense Leon Panetta’s latest plan would reduce the Army and Marines by about 100,000 over the next five years — essentially rolling back the increases that were part of the post-9/11 buildup — the former Massachusetts governor would double down by adding 100,000 more troops to present force levels.
His rhetoric and the bona fides of his neoconservative advisors suggest that one place President Romney might send those bulked up forces would be to Iran as “boots on the ground.” He has repeatedly claimed that, if President Obama is re-elected, Iran will get a nuclear weapon, and has asserted that if he is elected it will not. He has mocked the president for not being “tough enough” on the Iranians and implied that a Romney administration would consider force a go-to option against that country, rather than a threat meant to back up a diplomatic strategy.
Keep in mind that if Romney were to follow through on these costly undertakings and others like them, it would only add to the good old-fashioned waste and fraud that’s the norm of Pentagon contracting these days. As former head of the Joint Chiefs of Staff Admiral Mike Mullen pointed out, the post-9/11 national security spending binge played havoc with any sense of fiscal discipline at the Pentagon, eliminating the need to make “hard choices” or “limit ourselves” in significant ways. In his former position as Pentagon procurement czar, Under Secretary of Defense Ashton Carter acknowledgedthat “in a decade of ever-increasing defense budgets… it was always possible for our managers… when they ran into a technical problem or a difficult choice to reach for more money.”
Romney’s Republican math would ensure that this will continue. Defense giants like Lockheed Martin, whose F-35 combat aircraft has more than doubled in price over original projections, must be salivating at the prospect of another cost-overrun presidency, which would result in soaring profits and few punishments.
And let’s not forget the “spend more” brigades in the Republican House, led by Armed Services Committee Chairman Howard “Buck” McKeon (R-CA). Having received more than three quarters of a million dollars in campaign contributions from weapons contractors since 2009, he has never met a weapons system he didn’t like. Under a Republican administration, McKeon and his pork-barrel pals in Congress would have free rein to jack up spending on weapons and personnel with little concern for the impact on the deficit.
If a Republican president were to follow through on his campaign pledges, massive Pentagon increases and a dogged resistance to raising revenues would also result in major hits to every other item in the federal budget, from education to infrastructure. According to a report by the Center on Budget and Policy Priorities, the Romney budget plan could cut domestic discretionary programs by as much as 50% over the next 10 years.
In an April 1967 speech against the Vietnam War, Martin Luther King assailedthe buildup for that conflict as a “demonic destructive suction tube” that drew “men, money, and skills” away from solving urgent national problems. Romney’s military buildup would waste far more money than was expended during the Vietnam years. His presidency would exceed King’s worst nightmare. When will someone ask him to explain his fuzzy math?
William D. Hartung is the director of the Arms and Security Project at the Center for International Policy, a TomDispatch regular (where this column originally appeared), and the author of Prophets of War: Lockheed Martin and the Making of the Military-Industrial Complex. “Comments »
[youtube://http://www.youtube.com/watch?v=hdGJaGbLj5E 450 300]Comments »
A vacation in the Magic Kingdom should be enough to make a child giddy with excitement, but one young boy was left trembling with fear after he was subjected to an invasive TSA pat-down.
The three-year-old, confined to a wheelchair due to a recently broken leg, was with his family at O’Hare Airport in Chicago, on their way to board a flight to Disney World in Orlando, Florida.
Despite constant assurances from his father that ‘everything is OK’, he physically trembles with fear and asks his parents to hold his hand.
Scroll down for video
The terrified boy was swabbed on his hands and under his shirt for explosive residue.
His outraged father filmed the whole process and it has been posted on YouTube.
Despite such strict security for this toddler, the TSA is offering background-checked travellers the chance to use special lines and keep their shoes, belt and jacket on, leave laptops and liquids in carry-on bags and avoid a full-body scan – for a price.
The TSA’s new fast track ‘Precheck’ screening, now at two airlines and nine airports, is similar to security checks before 9/11, reports the Wall Street Journal.
To qualify, frequent fliers must be invited by airlines and meet an undisclosed TSA criteria.
A $100 fee for a background check is required as well as a brief interview with a Customs officer.
However, approved travelers who are in the U.S. Customs and Border Protection’s ‘Global Entry’ program can transfer into Precheck, according to the Journal.
‘It’s a completely different experience than what you’re used to,’ Matt Stegmeir, a platinum-level Delta Air Lines frequent flier who was invited into Precheck, told the Journal.
‘It’s really a jarring contrast. It reminds you just how much of a hassle the security procedures in place really are.’
The program can improve screening of unknown passengers if it can move low-risk people out of the main queues.
‘We can reduce the size of the haystack when we are looking for that one-in-a-billion terrorist,’ TSA Administrator John Pistole told the Journal.
Mr Pistole added that by studying frequent-flier histories as well as conducting background checks, he’s confident the U.S. now has the technology and the intelligence information to make less-rigorous, faster screening work.
TSA is working with only two airlines, American and Delta, on program which is still in the pilot phase.
Precheck lanes are already in place only at nine airports including Dallas-Fort Worth, New York Kennedy, Los Angeles, Miami, Atlanta, Detroit , Salt Lake City, Las Vegas and Minneapolis-St. Paul.
By the end of the year Precheck will be in place at 35 airports and six airlines, covering most major U.S. airports and airlines, reports the Journal.Comments »
On the six-month anniversary of the Occupy Wall Street movement, protesters swarmed its birthplace –Zuccotti Park – again sparking the cat-and-mouse clashes between New York City police officers and demonstrators.
The sweep of the park by police just before midnight capped a day of demonstrations and marching in lower Manhattan. There was no official word on the number of arrests but dozens of people were handcuffed and led out of the park.
Earlier in the day, 15 people were arrested and three officers suffered injuries, police said.
An unused public transit bus was brought in to cart away about a dozen demonstrators in plastic handcuffs.
One female under arrest apparently suffered a seizure and had difficulty breathing. She was taken away in an ambulance to be treated.
For hours, the demonstrators had been chanting and holding impromptu meetings in the park to celebrate the anniversary of the movement that has brought attention to economic inequality, as police mainly kept their distance.
But New York Police Det. Brian Sessa said the tipping point came when the protesters started breaking the park rules.
‘They set up tents. They had sleeping bags,’ he told the Associated Press. Electrical boxes also were tampered with and there was evidence of graffiti.
Det. Sessa said Brookfield Properties, the park owner, sent in security to advise the protesters to stop pitching tents and to leave the park.
The protesters, in turn, became agitated with them. The company then asked the police to help them clear out the park, the detective said.
Many protesters shouted and officers took out their batons after a demonstrator threw a glass bottle at the bus that police were using to detain protesters.
Sandra Nurse, a member of Occupy’s direct action working group, said police treated demonstrators roughly and made arbitrary arrests. She disputed the police assertion that demonstrators had broken park rules by putting up tents or getting out sleeping bags.
‘I didn’t see any sleeping bags,’ she said. ‘There was a banner hung between two trees and a tarp thrown over it … It wasn’t a tent. It was an erect thing, if that’s what you want to call it.’
She said they had reports of about 25 demonstrators arrested in the police sweep.
Protesters reconvened at the park following afternoon marches through New York’s financial district. By 11pm, roughly 300 had gathered there.
‘This is our spring offensive,’ Michael Premo, 30, of New York told Reuters. He identified himself as a spokesman for the movement.
‘People think the Occupy movement has gone away. It’s important for people to see we’re back.’
Inspired by the pro-democracy Arab Spring, the Wall Street protesters targeted U.S. financial policies they blamed for the yawning income gap between rich and poor in the country, between what they called the one per cent and the 99 per cent.
The demonstrators set up camp in Zuccotti Park on September 17 and sparked a wave of protests across the United States.
Famous face: Activist and outspoken filmmaker Michael Moore joined protesters and spoke briefly at the rally, calling it ‘the beginning’
Events got under way near midday on Saturday, with street theatre troupes performing and guitar players leading sing-alongs. Some boisterous protesters marched through the streets of the financial district, chanting ‘bankers are gangsters’ and cursing at police.
As they have in past marches, protesters led police on a series of cat-and-mouse chases. Marchers at the front of the crowd would suddenly turn down narrow side streets, startling tourists and forcing police to send officers on motor scooters to contain the crowd.
‘People are concerned that they have no control over their own democracy. They have no control over their own lives. This is the beginning. This park is sacred ground for millions across the country.’
-Filmmaker Michael Moore
The movement has made headlines for its clashes with police after campsites were set up for months in cities from New York to California. The camps were eventually shut down by authorities citing zoning regulations and public health concerns.
In New York, the Occupy movement lost significant momentum in November when a pre-dawn sweep broke up the encampment at Zuccotti, although Occupy protests in Oakland, California, in January led to police firing tear gas into crowds of protesters and more than 200 were arrested.
Protester Paul Sylvester, 24, of Massachusetts said he was ‘thrilled’ to be back at the park but said he hoped the movement would begin to crystallize around specific goals.
‘We need to be more concrete and specific,’ he said.
Critics say the Occupy movement lacks direction and clear demands.
It continues to draw celebrities, however. On Saturday night, independent filmmaker Michael Moore strode through the park before the police incursion.
‘I think it’s great that this movement continues to grow,’ Mr Moore said. ‘I think the goals are clear. People are concerned that they have no control over their own democracy. They have no control over their own lives.
‘This is the beginning. This park is sacred ground for millions across the country.’
As always, the protesters focused on a variety of concerns, but for Tom Hagan, his sights were on the giants of finance.
‘Wall Street did some terrible things, especially Goldman Sachs, but all of them. Everyone from the banks to the rating agencies, they all knew they were doing wrong. … But they did it anyway. Because the money was too big,’ he said.
Dressed in an outfit that might have been more appropriate for the St. Patrick’s Day parade, the 61-year-old salesman wore a green shamrock cap and carried a sign asking for saintly intervention: ‘St. Patrick: Drive the snakes out of Wall Street.’
Stacy Hessler held up a cardboard sign that read, ‘Spring is coming,’ a reference, she said, both to the Arab Spring and to the warm weather that is returning to New York City.
She said she believes the nicer weather will bring the crowds back to Occupy protests, where numbers have dwindled in recent months since the group’s encampment was ousted from Zuccotti Park by authorities in November.
But now, ‘more and more people are coming out,’ said the 39-year-old, who left her home in Florida in October to join the Manhattan protesters and stayed through much of the winter.
‘The next couple of months, things are going to start to grow, like the flowers.’
Some have questioned whether the group can regain its momentum. This month, the finance accounting group in New York City reported that just about $119,000 remained in Occupy’s bank account – the equivalent of about two weeks’ worth of expenses.
But Ms Hessler said the group has remained strong, and she pronounced herself satisfied with what the Occupy protesters have accomplished over the last half year.
‘It’s changed the language,’ she said. ‘It’s brought out a lot of issues that people are talking about.
And that’s the start of change.’
Read more: http://www.dailymail.co.uk/news/article-2116661/Occupy-Wall-Street-protesters-clash-police-Zuccotti-Park-movement-began-6-months-ago.html#ixzz1pUKYVnbU
Italy Pays Morgan Stanley $3.4 Billion to Exit Derivative Interest Contract; The Shuffling of Tax Dollars to Wall St.
“When Morgan Stanley (MS) said in January it had cut its “net exposure” to Italy by $3.4 billion, it didn’t tell investors that the nation paid that entire amount to the bank to exit a bet on interest rates.
Italy, the second-most indebted nation in the European Union, paid the money to unwind derivative contracts from the 1990s that had backfired, said a person with direct knowledge of the Treasury’s payment. It was cheaper for Italy to cancel the transactions rather than to renew, said the person, who declined to be identified because the terms were private.
The cost, equal to half the amount to be raised by Italy’s sales tax increase this year, underscores the risk derivatives countries use to reduce borrowing costs and guard against swings in interest rates and currencies can sour and generate losses for taxpayers. Italy, with record debt of $2.5 trillion, has lost more than $31 billion on its derivatives at current market values, according to data compiled by the Bloomberg Brief Risk newsletter from regulatory filings.
“These losses demonstrate the speculative nature of these deals and the supremacy of finance over government,” said Italian senator Elio Lannutti, chairman of the consumer group Adusbef.
The transaction may prompt regulators to push for greater transparency and regulation of how governments use derivatives, said the head of the European Parliament panel that deals with market rules.
‘Need to Know’
“This latest revelation shows that we need to know a lot more,”Sharon Bowles, chairwoman of the economic and monetary affairs committee, said in an interview today. “I’m reluctant to have quite as many exemptions for central banks and countries” from transaction-reporting rules, she said….”Comments »
“After cutting corners and relying on poor accounting, JPMorgan Chase shut down its legal operation against credit card debtors, some of whom may have been wrongly sued by the bank. It would appear to be another example of greed overcoming honesty. Ten years ago, Chase was recovering about $130 million a year in bad debt collections. By 2009, they were raking in $1.2 billion on credit card recoveries alone. The problem, legally and ethically, was that Chase was misrepresenting what they were selling to professional debt collectors. The increase in profits—and the decrease in ethical standards—would appear to have begun in 2008 when Edmond Helaire and his right-hand man, Jason Lazinbat, were put in charge of the credit card debt division in San Antonio, Texas.
One of the most important developments in the foreign exchange market is the fragmentation of the risk-on/risk-off matrix that was a key feature since the onset of the financial crisis. While cognizant of the non-linear nature of the capital markets and the fact that returns are not normally distributed, we continue to find use in monitoring the correlation between individual currencies and the US S&P 500. Numerous portfolio managers we talk to also watch these closely.
The break down has taken place over a range of currencies and we summarize the developments here. The correlations are calculated on the basis of the percent change in the foreign currency and the percent change in the S&P 500 on a rolling 60 day basis.
The euro’s correlation to the S&P 500 may be the most closely followed. In early December the euro’s correlation made what appears to be a record high just below 0.86. It now stands near 0.45. The correlation over the past 30 days has stands near 0.42, indicating a even weaker relationship more recently.
The yen’s correlation with the S&P 500 reached a 7-year high in mid-January of around 0.42. The relationship is now inverse, with the 60-day correlation now at about -0.11.
The Australian dollar and Canadian dollar’s correlations with the S&P 500 have also come off sharply, but remain comparatively high. The Aussie’s correlation stands at around 0.71 now, down from the peak of 0.92 at the end of December. The Canadian dollar’s correlation has fallen from 0.90 in mid-December to 0.68 now.
We looked at a couple emerging market currencies to see if the break down of the risk-on/risk-off matrix extended outside of the majors and sure enough it did. The Mexican peso’s correlation has fallen from about 0.84 just before Xmas to 0.62 now. At the same time, the South African rand’s correlation has fallen from a little above 0.86 to about 0.61 now.
To round out the exercise, we took a quick look at gold.
Gold is seen as the ultimate safe haven and yet it often is positively correlated with the S&P 500, a risk asset. This is the case now. Since the middle of November (even though the European debt crisis was intensifying), gold has been positively correlated with the S&P 500, giving the sense that gold is acting more as a momentum trade than a safe haven. The recent peak of the correlation was in late January near 0.63, which was the highest since April 2010. Today it stands near 0.30.Comments »
The totalitarian instinct in Finkelstein’s report
March 09 2012 (5:26pm)
Superb piece by John Roskam against the menacing Finkelstein report – and Malcolm Turnbull’s foolish puffing of it:
Finkelstein’s recommendations are profoundly illiberal and undemocratic.
They are the most serious assault on the liberties of Australians since Robert Menzies tried to ban the Communist Party in 1949. It is almost incredible that Finkelstein, who as a Federal Court judge once adjudicated on the lives of citizens according to the laws of a liberal democracy, could conceive of such a regime to control freedom of speech.
Finkelstein’s ideological position is not hard to find. It’s in paragraph 4.10 of his report. He thinks a council should control speech in Australia because most people are too dumb or ignorant to decide for themselves about what they see and hear and read in the media.
In response to the claim from News Ltd’s John Hartigan that ultimately readers “were capable of making up their own minds” about bias in the media, Finkelstein writes, “often, however, readers are not in a position to make an appropriately informed judgment”.
This is intellectual arrogance at its most breathtaking. And it’s a great argument against democracy. If, as Finkelstein claims, people aren’t smart enough to decide for themselves the merits of what they see in the media then they’re certainly not smart enough to decide who to vote for.
This is the totalitarian fallacy: don’t let the people decide (because the people are too stupid), let judges and academics decide for them.
Read the rest here.Comments »
(CNN) — International officials in a Syrian-led mission will attempt to gauge humanitarian conditions across the turbulent nation this weekend as world powers push for open entree to provide much-needed relief.
This comes as the Syrian conflict enters its second year, with President Bashar al-Assad’s fierce crackdown against anti-government enclaves showing no signs of ending. More than 8,000 civilians have been killed during the conflict, the United Nations says, but opposition activists said the overall toll is more than 9,000, mostly civilians.
The numbers have exceeded 9,700 and are “fast approaching 10,000,” said Rafif Jouejati, spokeswoman for the Local Coordination Committees of Syria, an opposition activist network.
Valerie Amos, U.N. under-secretary-general for humanitarian affairs, said Thursday the government will lead a mission to the provinces of Homs, Hama, Tartous, Latakia, Aleppo, Deir Ezzor, Rif Damashq and Daraa. U.N. and Organization of Islamic Cooperation officials will accompany the mission, she said.
“It is increasingly vital that humanitarian organizations have unhindered access to identify urgent needs and provide emergency care and basic supplies,” she said in a written statement. “There is no time to waste.”