Welcome to The Automatic Earth
Or rather, welcome to The Automatic Earth 2.0. After 4 years at Blogger, it's high time for us to widen our scope, our perspectives and our platform. Which is why we developed this new site the way we have.
For our articles we will use the labels Features and Commentaries, for longer and shorter articles. Features will be posted every 2-3 days, Commentaries several times daily. A second set of labels divides the content into the categories Finance, Energy and Earth.
There is also a fourth category, Lifeboat. It has 10 subcategories, and will perhaps be the most prominent change from our previous site. In Lifeboat, we will, among other things, collect information from our readership on any and all topics related to what we will need to do to make the transition into a much less affluent world more bearable.
We are very happy to have Sharon Astyk come aboard for the Lifeboat section (and anything else she wants to do). And of course we're very happy to have Ashvin Pandurangi and our Facebook and Twitter reporter VK on board as well, and we shouldn't forget our backend man Dan.
Most of all, it will have to be our readers who fill up the Lifeboat section. There is such a lot of knowledge and there are so many great ideas out there, and we have come in contact with so many great people through the site and during our travels for Nicole's lectures, that we''re sure we're about to open up a huge source of information. After all, we connect people in different countries and even continents with each other who had or have no previous means to establish such connections.
The comments are a bit different from Blogger too; here we have a Forum, you can log in through the bar at the bottom of the page or through the article pages. And yes, we did put in a few safety measures.
I think most of it will come naturally as you’re exploring the site. And I’m sure that if I’m wrong, you’ll find a way to let me hear about that.
The various pages and sections will take a little time to really fill up, please bear with us. And let's make it good!
Ilargi
PS: Please do remember that The Automatic Earth exists by the grace of your donations.
Homo sapiens v. FWS
|
|
- Daily Links
- $3 Billion and Counting: JP Morgan's Loss Grows by 50% in 5 Days
By Derek Thompson - The Atlantic. When JP Morgan announced a shocking $2 billion loss, chief executive Jamie Dimon admitted the amount could double to $4 billion by the end of the year. Instead it has increased by 50% in a matter of days. Two billion has become $3 billion, as hedge funds and other investors "have fueled faster deterioration in the underlying credit market positions held by the bank," DealBook reports. It is, as Conor Sen quipped on Twitter, "like a BP oil spill in derivative form." - Coffee May Help Drinkers Live Longer, U.S. Study Suggests
By Nicole Ostrow - Bloomberg. Coffee, caffeinated or decaffeinated, may help extend the lives of people who drink it daily, a U.S. study found. Men who drank 2 to 3 cups a day had a 10 percent chance of outliving those who drank no coffee, while women had a 13 percent advantage, according to research published yesterday in the New England Journal of Medicine. The study by researchers at the National Cancer Institute is the largest to compare coffee drinkers with those who avoid it to determine whether the beverage can delay the risk of dying from ailments such as heart disease, diabetes or respiratory illness, said Neal Freedman, the lead study author. It’s unclear why coffee may be beneficial and more research is needed to study that question, he said. - So now we know whose fault the recession is. Ours
By Zoe Williams - Guardian. Actually, there was a growing gap between pay and economic output, which is to say, wages at the bottom weren't high enough. This will, over time, suck demand out of the economy and lead to recession. The Tories can tub thump all they like about how we can't stimulate the economy "buying things we can't afford", but the truth is, if those low earners hadn't taken on some debt, we would have simply had the recession sooner. What caused the wage depression? A surge – you might call it an unsustainable salary binge – in riches at the top. This is an easily discernible pattern, pointed out by the economist Stewart Lansley: in the US, there have been only two periods in a century when the richest 1% held more than a fifth of the country's income pool. One was in the eight years running up to the Great Depression. The other was in the 18 years running up to this Even Better Depression (in 1990, they held 14.3%; by 2006 it was 22.8%). Furthermore, if household indebtedness was that bad, why was no UK bank buried under its weight? All these debts are held by high street banks. As we've seen, in the face of instability from the international derivatives market, they had no resilience at all. And yet their lending to UK households has been strangely unproblematic, which suggests not that the banks have found some unexpected capital reserves under their mattresses, but rather that households soldier on with their debts. - Fitch says top 29 banks may need $556 billion
LONDON (Reuters) - The world's top 29 banks may need a total $556 billion (351 billion pounds) to meet tougher new capital rules, cutting returns by a fifth and forcing them to curb investor payouts and raise customer charges, Fitch Ratings said on Thursday. The credit rating agency studied 29 banks named by world leaders (G20) as being globally systemically important financial institutions (G-SIFI) and required to hold core capital buffers of up to 9.5 percent by the start of 2019. The list includes Barclays , Deutsche Bank , Goldman Sachs , HSBC , JPMorgan Chase , and UBS . Fitch said the banks represented $47 trillion in assets and may need to raise $566 billion common equity to hit core ratios of around 10 percent to satisfy new global Basel III requirements being phased in over several years from January. - The 4 hard lessons of 2008 that Dimon must accept
By Paul B Farrell - MarketWatch. Yes, Jamie Dimon’s still J.P. Morgan Chase’s CEO. But has he finally learned the four hard lessons about taking high-risk gambles in the global $650 trillion derivatives market that in 2008 virtually bankrupt Wall Street and the economy? Will he stop fighting all reforms? Or will he just get cleverer and keep pushing his 2011 strategy? And never learn the lessons, till we repeat the 2008 meltdown? Dimon strategy: In 2011 he addressed the U.S. Chamber of Commerce, headlines raced across the web: “Jamie Dimon Worries That Financial Regulation Will Doom Banks, Forever.” Suddenly Dimon became America’s newest “Dr. Doom” attacking Dodd-Frank financial reforms as a “nail in the coffin for big American banks.” This year he pounded a $2 billion nail in his own coffin. So far he’s dodged the stake. But has this Dr. Doom finally learned the four big lessons? - Leading economic indicators fall 0.1% in April
By Marketwatch. The economy is "still struggling to gain momentum," though long-term trends remain expansionary, the Conference Board said Thursday as it reported that its index of leading economic indicators fell 0.1% in April, the first decline since September. "Growth is slow, but choppy, and consumers, executives and investors are looking for more progress," said Ken Goldstein, economist at the Conference Board, a private research group. Economists polled by MarketWatch had expected an April gain of 0.1%, following an increase of 0.3% in March. The LEI is a weighted gauge of 10 indicators that are designed to signal business cycle peaks and troughs. Among the 10 indicators that make up the LEI, four made negative contributions in April, led by building permits. In the six months through April, the LEI rose 1.8%, compared with a gain of 0.1% in the prior six months. - New era for China's oil industry
Zhou Yan - China Daily: he first deepwater drilling rig developed in China is scheduled to drill a well in a part of the sea known as 43/11 block this year at a water depth of 2,454 meters, making it the deepest well in the South China Sea. The block is being explored by China National Offshore Oil Corp, BP Plc and Anadarko Petroleum Corp. It is on a short list of sites where CNOOC, the owner of the rig, is considering using semi-submersible deepwater rig this year to drill wells. On Wednesday, the rig began drilling its first well in an area 320 km southeast of Hong Kong and at a water depth of 1,500 meters. The 5.3-billion-yuan ($839.9 million) rig is to drill the well for 56 days before being towed to other drilling sites in the Baiyun Depression, which encompasses 20,000 square kilometers in the eastern part of the South China Sea, said Shi Hesheng, the chief geologist of CNOOC (CHINA) Ltd Shenzhen Branch. The Baiyun Depression contains about 700 million metric tons of crude oil and 1.2 trillion cubic meters of gas, Shi said. The company said the progress of work at each of the proposed wells will largely determine how the drilling rig is used. In general, the equipment can drill about five to six wells a year, according to Zhou Shouwei, former deputy general manager of CNOOC. China, as the world's second-largest oil consumer, used 470 million tons of oil in 2011. It has accelerated its pace of exploring for oil and gas in deepwater areas in the South China Sea, which is estimated to contain up to 30 billion tons of oil and 16 trillion cubic meters of gas, or a third of the country's oil and gas resources. New era for China's oil industry Technological restrictions have hindered CNOOC from making rapid forays into deepwater drilling, which is riskier and costlier than exploring in shallow waters. Generally speaking, the cost of drilling a deepwater well is about $30 million to $60 million, about five times higher than drilling in shallow waters, according to CNOOC, which said that it will need from 25 to 30 years to break even on the rig's cost. - Europe's nuclear brinkmanship with Greece is a lethal game
Ambrose Evans-Pritchard - Telegraph: Fresh from the Hellenic Statistical Authority: Youth unemployment up to the age of 24 reached a fresh record of 53.8pc in February. The rate for those aged 25-34 rose to 29.1pc. The total rate hit 21.7pc but will soon be much higher as 150,000 public sector workers are chopped – with pro-cyclical effects, in the middle of a depression – to comply with the EU-IMF Memorandum Polls show that 70pc or even 80pc of Greeks still wish to stay in the euro, while at the same voting in large numbers for hard-Left and hard-Right parties committed to tearing up the Memorandum – a course of action that will take them straight out of the euro. I do not wish to reproach the Greeks for cognitive dissonance. We all do this, and besides, euro membership is more than just a currency for Greece. It is the anchor of identity for an isolated Balkan nation living cheek by jowl with the Ottoman nemesis (nemesis from their point of view. I like Turks). Greeks have yet to conclude that the euro itself is the cause of their catastrophe – though they are getting there. By the euro, I mean the whole structure of monetary union, made worse under current policy settings (incompetence). There can be no possible escape from this lamentable state of affairs at this late stage until they return to the drachma. - Drug-Defying Germs From India Speed Post-Antibiotic Era
By Jason Gale and Adi Narayan - Bloomberg. “I got a call from my doctor who told me they found this bug in me and I had to take precautions,” Skaret remembers. “I was very afraid.” Skaret was lucky. Eventually, her body rid itself of the bacteria, and she escaped harm from a new type of superbug that scientists warn is spreading faster, further and in more alarming ways than any they’ve encountered. Researchers say the epicenter is India, where drugs created to fight disease have taken a perverse turn by making many ailments harder to treat. India’s $12.4 billion pharmaceutical industry manufactures almost a third of the world’s antibiotics, and people use them so liberally that relatively benign and beneficial bacteria are becoming drug immune in a pool of resistance that thwarts even high-powered antibiotics, the so-called remedies of last resort. - HSBC's provisions for PPI compensation rises to £745m
By Harry Wilson - Telegraph. The lender said it made a £290m ($468m) provision in the first quarter against PPI claims, taking the total amount set aside to pay out compensation to £745m. HSBC’s provision follows similar moves by Barclays, Lloyds Banking Group and Royal Bank of Scotland, which have all seen a spike in compensation claims since the beginning of the year. Stuart Gulliver, chief executive of HSBC, added to the criticism of PPI claims management companies and said they were putting in thousands of bogus claims creating an “administrative hassle” that was delaying payouts to genuine victims. - Greece Likely to Exit Euro This Year, FX Concept’s Taylor Says
By John Detrixhe and Erik Schatzker - Bloomberg. Greece will probably leave the euro as soon as next month as the government runs out of cash and European institutions fail to lend more to the nation, according to John Taylor of hedge fund FX Concepts LLC. “This summer I think is very likely,” Taylor, founder and chief executive officer of FX Concepts in New York, said today in an interview on Bloomberg Television’s “Inside Track” with Erik Schatzker and Sara Eisen. “The Europeans aren’t going to give them the money, the International Monetary Fund’s not going to give them an OK. They will be out of money in June.” - Developed Nations at the Precipice of Oblivion , as End of the Debt Supercycle Draws Near
Interview with John Mauldin on The Gold Report. TGR: You have spoken about the end of the developed-world debt supercycle and the end of the ability for governments to borrow cheap money. You said this development is bullish because that debt was invested in inefficient ways and now it will be invested in smart ways. How will countries like Germany, France, Spain and Ireland be affected differently from a country like China or Argentina by this endgame? JM: Those are all radically different countries. The developed European countries—Ireland, Spain, Italy, even France—are going to see their governments forced to shrink. Germany will have to limit its growth in government. China is different. It didn't get into a government debt bubble. It has its own particular crisis to deal with. It has a housing and banking debt bubble. Argentina is just a bad case. President Cristina Kirchner is displaying signs of massive economic psychosis. The actions that she's been taking are the opposite of what you would do if you want to be able to stand up and say, "We're a civilized country that respects the rule of law." It is demonstrably bad for equity investors. People who loan money or do business in Argentina in such a way that the government can access their capital deserve what they get. Ireland has rule of law. I think Ireland is a great place to put a foreign company. It has English-speaking people, hard workers, an educated labor force and low taxes. It set itself up to be the source for international business. TGR: Ireland was booming for a short period of time. JM: It boomed too well. It didn't continue because, just like Spain and the U.S., it believed its own housing bubble. Too much of its economy was invested in housing, which is what China is going to have a problem with. It just built too much stuff with too much money, and it's going to have to rationalize. Australia has a housing bubble. There's a book that came out last week that talks about the Australian miracle and why it's different this time. I think, "Oh, could they ring a bell at the top any louder?" - Angry academics can't answer my criticism that there's too little analysis of our current crisis
By Aditya Chakrabortty - Guardian. At the fag end of one university term, two Cambridge economists set about persuading a prime minister to do a U-turn. Somehow, they thought a letter would do the trick. So opposed were Frank Hahn and Robert Neild to Margaret Thatcher's austerity economics that in March 1981 that they asked fellow academics to sign a memo warning: "Present politics will deepen the depression, erode the industrial base … and threaten … stability." The protest was signed by 364 of Britain's most eminent economists, including the eventual head of the Bank of England, Mervyn King, and published in the Times. Thirty years on, and you already know what good the protest did: none whatsoever. The lady was not for turning. At the time, however, it was big news. Thatcher was challenged in parliament to name even two economists who supported her (an aide remarked she was lucky not to be asked for a third). The current crisis of capitalism is bigger, and more multi-faceted, than the one Britain faced at the turn of the 80s, yet it hasn't triggered anything like the same response from our faculties. - Dragon's Den 1
BBC World Service Podcast. This week on Global Business Peter Day reports from China where political strife is in the news. But behind the headlines cracks are appearing in the country's long economic boom. Or is it just business as usual? - Recession plus austerity equals loss of political power
Guardian. The government has had a terrible time since the budget in late March, capped by the poor performance by the two halves of the coalition in the local elections. It would be wrong, however, to imagine that the big gains for Labour are due to granny taxes and VAT on cornish pasties, or even the travails of Jeremy Hunt. What these issues have done is crystallise unhappiness among voters: deep down they have been wanting to give the government a good kicking and now they have found a reason to do so. Britain is not alone in this. The financial and economic crisis of the past five years has resulted in governments being toppled everywhere: Barack Obama's victory in 2008, Gordon Brown's defeat in 2010, and the forecast defeat of Nicolas Sarkozy in the French presidential race this weekend are all part of the same political dynamic. - GDP Miss Far Bigger Than Announced; Real GDP is 0% Using More Reasonable Deflator
By Mish Shedlock - GEA. The Advance Estimate for Q1 GDP came in at 2.2%, down from 3.0% in the previous quarter, and below most mainstream media estimates of 2.5%. However, my friend BC notes .... The GDP deflator is reported to have averaged 1.2% annualized in the past 2 qtrs. Had the trend rate from '11 persisted, the deflator would have subtracted 2.6% annualized from real GDP, resulting in a 2-qtr. growth of real GDP of 0%. ECRI's Achuthan would appear correct that a recession were imminent instead of looking like a dummy. - U.S. Perfecting Formula for Budget Failure, Says Bowles
By William D. Cohan - Bloomberg. “I think today we face the most predictable economic crisis in history,” he told an audience on April 24 at the Council on Foreign Relations -- an audience that might actually be able to help do something about the problem. “Fortunately, I think it’s also the most avoidable. I think it’s clear, if you do simple arithmetic, that the fiscal path that the nation is on is simply not sustainable.” Bowles, a Democrat, then laid on the crowd some pretty simple, but devastating, arithmetic. He explained that 100 percent of the tax revenue that entered the Treasury in 2011 went out the door to pay for mandatory spending -- such as Medicare, Medicaid and Social Security -- and to pay the interest on our staggering $15.6 trillion national debt. That means that every single dollar we spent on everything else, including two wars, national defense, homeland security, education, infrastructure, high-value-added research and the like, was borrowed. “And,” he warned, “half of it was borrowed from foreign countries. And that is a formula for failure in anybody’s book.”
- $3 Billion and Counting: JP Morgan's Loss Grows by 50% in 5 Days
Stoneleigh Occupies:
Australia and New Zealand
Check the Facebook TAE Tour Page
Feb 9 Sunshine Coast
The Big Pineapple, Woombye 6pm
Feb 10 The Channon
Channon Community Hall 6pm
Feb 11 Coff’s Harbour
Cavanbah Hall 12pm
Feb 12 Bungendore NSW
Mulloon Creek Natural Farms 3.30-9pm
Feb 13 Canberra
CSIRO Discovery Centre 7.30pm
Feb 16 Daylesford
Daylesford Town Hall 7pm
Feb 17 Melbourne
Federation Square Sustainable Living Festival evening
Feb 18 Melbourne
Federation Square Sustainable Living Festival 3pm
Feb 19 Brunswick
Ceres Community Environment Park 9am-3.30pm (with Steve Keen)
Feb 21 Leongatha
Memorial Hall 6.30pm
Feb 22 Geelong
Gordon TAFE Auditorium 6pm
Feb 23 Adelaide
Hawke Centre, University of South Australia, West Campus 4pm
Feb 24 Fremantle
Fremantle Town Hall 7pm
Feb 28 Margaret River
Margaret River District Club 7pm
Feb 29 Albany
George's Restaurant, Great Southern Institute of Technology 6.30pm
Mar 1 Manjimup
Library Gallery Room 6pm
Mar 8 Perth
Perth Town Hall 5pm
Mar 9 Guildford
St Matthew's Hall 6pm
Mar 11 Fremantle
Fremantle Town Hall, All Day Ecoburbia Conference 10am-4pm
Mar 13 Hobart
Centenary Lecture Theatre 7pm
Mar 15 Launceston
Lecture Theatre 9, Faculty of Arts 7pm
New Zealand
Mar 19 Waititi
Waititi Community Hall 7pm
Mar 20 Otago
Archway 4 Lecture Theater UofO 5.15pm
Mar 21 Hampden
Hampden Hall 7pm
Mar 23 Christchurch
CPIT 12pm
Mar 23 Christchurch
CPIT 6pm
Mar 27 Lyttleton
Naval Point Club 5pm
Mar 29 Richmond
Tasman District Library 12.30pm
Mar 29 Motueka
Community House Docks Reserve 7.30pm
Mar 30 Nelson
Victory Community Center 5.30pm
Apr 2 Takaka
Senior Citizens Hall 7pm
Apr 5 Wellington Turnbull House 12pm
Apr 7 Otaki Clean Technology Centre 1.30pm
Apr 10 Wanganui
Venue TBC 7pm
Apr 11-15 Turangi
11th Australasian Permaculture Convergence
Apr 16 Hamilton
Hamilton City Council reception lounge 12pm
Apr 16 Auckland
RSC, 1 Francis St., Grey Lynn 7pm
Apr 17 Waiheke Island
Waiheke Community Cinema, 2 Korora Rd. 7pm
Apr 19 Auckland
University of Auckland, Case Room 1, Owen Glenn Building.6pm
Apr 20 Auckland
SBN breakfast, Level 3, Old Sofrana House 8am
Apr 20 Auckland
Direction Healing Centre, 12 Horopito St., Mt Eden 7pm
Australia
Apr 22 Brisbane
Jagara Arts Centre 6pm
Apr 24 Sunshine Coast
The Big Pineapple, Woombye 6pm
May 11 Cairns
JCU Campus4pm
May 12 Malanda
CWA Hall 6pm
May 13 Cairns
Redlynch State College, Redlynch, Cairns 6pm
Europe May-Aug 2012 Dates available
Request Lectures: StoneleighTravels •at• gmail •dot• com.
Follow Us:
 |  |  |
| Get free email alerts for The Automatic Earth |
| Email: |
Link Vault
- Sharon Astyk
- Steve Keen
- Aaron Krowne
- Patrick Killelea
- Mish Shedlock
- John Rubino
- Max Keiser
- Yves Smith
- Jim Fitch
- Jim Kunstler
- Tyler Durden
- Jay Hanson
- Michael Panzner
- LEAP 2020
- Jesse's Café
- Michael Snyder
- Doug Short
- Cornucopia?
- Keith Hazelton
- Steve Waldman
- Dave Cohen
- Kalpa
- John Hussman
- Chris Martenson
- Biodiversecity
- Russ Winter
- Damien Hoffman
- Thomas Palley
- Ed Harrison
- George Ure
- Karl Denninger
- Carolyn Baker
- Aki Järvinen
- Cercle de Gindou
- Suomi Watches
- Toni Straka
- Albert Bates
- Hellasious
- CR & Tanta
- Lee Adler
- Prudent Bear
- Angry Bear
- Shorpy
- Agora Rude
- Bill Bonner
- Greenpa
- Greyzone