Austria 2009 Timelapse (HD) from Christian Vanhove on Vimeo.
Architecture HD Slideshow from Christian Vanhove on Vimeo.
The Hubble Ultra Deep Field in 3D from Ardeleanu Mihai on Vimeo.
NASA | The Last Mission to Hubble from NASA Goddard on Vimeo.
Sunday, June 27, 2010
Digital Universe
I am increasingly intrigued by the possibilities of the new digital world, photography, HD Videos, music, architecture, cable internet, iPhone, Hubble. 01010101 applied to endless combinations and creative applications, recording space and time, blurring the distinction between real and synthetic, live and recorded, here or there. time and space and mans place in the heavens.
Sunday Morning BLUES
I like to start my day with a bit of soulful Blues.
Perhaps some replays but its all cool. Life often is colored blue.
P
Friday, June 25, 2010
Ambrose Evans-Pritchard: Bernanke needs fresh money blitz as U.S. recovery falters
By Ambrose Evans-Pritchard
The Telegraph, London
Thursday, June 24, 2010
http://www.telegraph.co.uk/finance/economics/7852945/Ben-Bernanke-needs-...
Federal Reserve chairman Ben Bernanke is waging an epochal battle behind the scenes for control of US monetary policy, struggling to overcome resistance from regional Fed hawks for further possible stimulus to prevent a deflationary spiral.
Fed watchers say Mr Bernanke and his close allies at the board in Washington are worried by signs that the US recovery is running out of steam. The ECRI leading indicator published by the Economic Cycle Research Institute has collapsed to a 45-week low of -5.7 in the most precipitous slide for half a century. Such a reading typically portends contraction within three months or so.
Key members of the five-man board are quietly mulling a fresh burst of asset purchases, if necessary by pushing the Fed's balance sheet from $2.4 trillion (L1.6 trillion) to uncharted levels of $5 trillion. But they are certain to face intense scepticism from regional hardliners. The dispute has echoes of the early 1930s when the Chicago Fed stymied rescue efforts.
"We're heading towards a double-dip recession," said Chris Whalen, a former Fed official and now head of Institutional Risk Analystics. "The party is over from fiscal support. These hard-money men are fighting the last war: They don't recognise that money velocity has slowed and we are going into deflation. The only default option left is to crank up the printing presses again."
Mr Bernanke is so worried about the chemistry of the Fed's voting body -- the Federal Open Market Committee (FOMC) -- that he has persuaded vice-chairman Don Kohn to delay retirement until Janet Yellen has been confirmed by the Senate to take over his post. Mr Kohn has been a key architect of the Fed's emergency policies. He was due to step down this week after 40 years at the institution, depriving Mr Bernanke of a formidable ally in policy circles.
The Fed's statement this week shows growing doubts about the health of the recovery. Growth is no longer "strengthening"; it is "proceeding." Financial conditions are now "less supportive" due to Europe's debt crisis.
The subtle tweaks in language have been enough to set bond markets alight. The yield on 10-year Treasuries has fallen to 3.08 percent, the lowest since the gloom of April 2009. Futures contracts have ruled out tightening until well into next year.
Yet the statement may understate the level of angst at the board. New home sales crashed 33 percent in May to an all-time low of 300,000 after the homebuyer tax-credit expired, confirming fears that the housing market has been propped up by subsidies. Unemployment is stuck at 9.7 percent. Manufacturing capacity use is at 71.9 percent. The Fed's "trimmed mean" index of core inflation is 0.6 percent on a six-month basis, a record low.
"The US recovery is in imminent danger of stalling," said Stephen Lewis, from Monument Securities. "Growth could be negative again as soon as the fourth quarter. There is no easy way out since fiscal stimulus has already been pushed as far as it can credibly go without endangering US credit-worthiness."
Rob Carnell, global strategist at ING, said the Obama fiscal boost peaked in the first few months of this year. It will swing from a net stimulus of 2 percent of GDP in 2010 to a net withdrawal of 2 percent in 2011. "This is very substantial fiscal drag. On top of this the US Treasury is talking of a 'Just War' against the banks, which will further crimp lending. It is absolutely the wrong moment to do this."
Kansas Fed chief Thomas Hoenig dissented from Fed calls for ultra-low rates to stay for an "extended period", arguing that loose money risks asset bubbles and fresh imbalances. He recently called for interest rates to be raised to 1 percent by the autumn.
While he has been the loudest critic, he is not alone. Philadelphia chief Charles Plosser says the Fed has blurred the lines of monetary and fiscal policy by purchasing bonds, acting as a Treasury without a legal mandate. Together with Richmond chief Jeffrey Lacker they represent a powerful block of opinion in the media and Congress.
Mr Bernanke has fought off calls from FOMC hawks for moves to drain stimulus by selling some of the Fed's $1.75 trillion of Treasuries, mortgage securities, and agency bonds bought during the crisis. But there is little chance that he can secure their backing for further purchases at this point. "He just has to wait until everybody can see the economy is nearing the abyss," said one Fed watcher.
Gabriel Stein from Lombard Street Research said the US is still stuck in a quagmire because Mr Bernanke has mismanaged the quantitative easing policy, purchasing the bonds from banks rather than from the non-bank private sector.
"This does nothing to expand the broad money supply. The trouble is that the Fed does not understand broad money and ascribes no importance to it," he said. The result is a collapse of M3, which has contracted at an annual rate of 7.6 percent over the last three months.
Mr Bernanke focuses instead on loan growth but this has failed to gain full traction in a cultural climate of debt repayment. The Fed is pushing on the proverbial string. The jury is out on whether or not his untested doctrine of "creditism" will work.
"We are now walking on deflationary quicksand," said Albert Edwards from Societe Generale.
Wednesday, June 23, 2010
ECRI - Business Cycles, inflation, deflation, and gold
ECRI Weekly Leading Indicators Widely Misunderstood
By lakshman - June 23rd, 2010, 7:00AM
There’s been much attention to our work of late, culminating in a report this Tuesday from Bank of America listing several critiques of our Weekly Leading Index (WLI). Apparently, the clinching argument is that “If a single indicator always accurately predicted the trajectory of the economy, the demand for Wall Street economists would be significantly reduced.”
To some Wall Street economists, it may seem self-evident that there should be strong demand for their views. But this is not at all clear to us as far as their recession-forecasting function is concerned. After all, a 63-country IMF study on economists’ recession-forecasting prowess concluded that “The record of failure to predict recessions is virtually unblemished.” In contrast, the IMF subsequently noted that ECRI “has actually had a very stellar record” of recession forecasting.
As we outlined in our 2004 book, Beating the Business Cycle, there is no Holy Grail of economic forecasting, even among our large array of state-of-the-art leading indexes, of which the WLI is but one. It seems that many of the self-styled experts on the WLI either haven’t read the book, or simply don’t understand the parts of the book where we repeatedly state, in no uncertain terms, that ECRI does not use models.
We aren’t entirely surprised. Virtually the entire analytical community has been trained to believe that any and all quantitative approaches to forecasting must involve models, i.e., simplified representations of reality. The idea that there could be rigorous quantitative approaches that are not model-based seems to be entirely beyond their ken. Their understanding of analytical techniques is so model-soaked that it reminds us of an insightful comment from psychologist Daryl Bem: “It takes a very intelligent and non-parochial fish to realize that his environment is wet.”
So it is with economists who cannot imagine that ECRI’s leading indexes are not model-driven or based on back-fitting of data. Thus the BofA report notes that “the ECRI (sic) and other leading indexes . . . fit the business cycle better ex post than ex ante” and that “This is an example of a broader issue in all statistical models of the economy. The data fit much better in-sample than out-of-sample.”
They just don’t get it. While this may be a valid criticism of statistical models of the economy, ECRI’s leading indexes are not, in any sense, statistical models of the economy.
BofA’s ignorance of the facts continues in their use of a 1993 (yes, 1993!) Dallas Fed study of the Commerce Department’s LEI to impugn the WLI. The Fed paper correctly points out that the-then LEI got revised a lot — a situation that hasn’t changed now that the Conference Board maintains the index. However, none of what the Fed reviewed in 1993 had anything to do with the WLI, which is the target of the current BofA report.
Furthermore (not that we’re fans of the Conference Board’s LEI) but the Dallas Fed study may not be valid in the first place, since the results are based on a Bayesian model chosen by the Dallas Fed to generate recession and recovery signals from the LEI. In other words, it isn’t clear whether failures highlighted in that report have to do with the LEI itself or the assumptions and the specifications of the Bayesian model used in that study.
Still, the BofA’s latest forecast of a “recovery, stronger than what we saw in the early 2000s and 1990s, but weaker than V-shaped recovery in the early 1980s” is very much in line with what ECRI predicted — in August 2009. At that time, we said the recovery would be “at a stronger pace than any the United States has seen since the early 1980s.”
BofA’s parroting of our forecast from late last summer reminds us of Jon Stewart’s segment on Nowcasting where experts describe something that’s already happening as though it’s coming (Jason Jones starts at three-minute mark).
Bottom line, neither the “experts” predicting that the sky is falling based on the WLI, nor the other “experts” indulging in misinformed WLI-bashing in an effort to discredit the super-bears, have a real clue to what the WLI is all about. We created the WLI not to be an infallible, stand-alone recession-forecasting machine, but as one small part of a much larger array of leading indexes (each made up of many economic indicators) — like the especially prescient U.S. Long Leading Index. This array amounts to a sophisticated sequential signaling system of the economy’s cyclical turning points. The WLI is designed to be interpreted in this broader context, and its message today is quite simple: A slowdown in U.S. economic growth is imminent, but a new recession is not.
To some Wall Street economists, it may seem self-evident that there should be strong demand for their views. But this is not at all clear to us as far as their recession-forecasting function is concerned. After all, a 63-country IMF study on economists’ recession-forecasting prowess concluded that “The record of failure to predict recessions is virtually unblemished.” In contrast, the IMF subsequently noted that ECRI “has actually had a very stellar record” of recession forecasting.
As we outlined in our 2004 book, Beating the Business Cycle, there is no Holy Grail of economic forecasting, even among our large array of state-of-the-art leading indexes, of which the WLI is but one. It seems that many of the self-styled experts on the WLI either haven’t read the book, or simply don’t understand the parts of the book where we repeatedly state, in no uncertain terms, that ECRI does not use models.
We aren’t entirely surprised. Virtually the entire analytical community has been trained to believe that any and all quantitative approaches to forecasting must involve models, i.e., simplified representations of reality. The idea that there could be rigorous quantitative approaches that are not model-based seems to be entirely beyond their ken. Their understanding of analytical techniques is so model-soaked that it reminds us of an insightful comment from psychologist Daryl Bem: “It takes a very intelligent and non-parochial fish to realize that his environment is wet.”So it is with economists who cannot imagine that ECRI’s leading indexes are not model-driven or based on back-fitting of data. Thus the BofA report notes that “the ECRI (sic) and other leading indexes . . . fit the business cycle better ex post than ex ante” and that “This is an example of a broader issue in all statistical models of the economy. The data fit much better in-sample than out-of-sample.”
They just don’t get it. While this may be a valid criticism of statistical models of the economy, ECRI’s leading indexes are not, in any sense, statistical models of the economy.
BofA’s ignorance of the facts continues in their use of a 1993 (yes, 1993!) Dallas Fed study of the Commerce Department’s LEI to impugn the WLI. The Fed paper correctly points out that the-then LEI got revised a lot — a situation that hasn’t changed now that the Conference Board maintains the index. However, none of what the Fed reviewed in 1993 had anything to do with the WLI, which is the target of the current BofA report.
Furthermore (not that we’re fans of the Conference Board’s LEI) but the Dallas Fed study may not be valid in the first place, since the results are based on a Bayesian model chosen by the Dallas Fed to generate recession and recovery signals from the LEI. In other words, it isn’t clear whether failures highlighted in that report have to do with the LEI itself or the assumptions and the specifications of the Bayesian model used in that study.
Still, the BofA’s latest forecast of a “recovery, stronger than what we saw in the early 2000s and 1990s, but weaker than V-shaped recovery in the early 1980s” is very much in line with what ECRI predicted — in August 2009. At that time, we said the recovery would be “at a stronger pace than any the United States has seen since the early 1980s.”
BofA’s parroting of our forecast from late last summer reminds us of Jon Stewart’s segment on Nowcasting where experts describe something that’s already happening as though it’s coming (Jason Jones starts at three-minute mark).
Bottom line, neither the “experts” predicting that the sky is falling based on the WLI, nor the other “experts” indulging in misinformed WLI-bashing in an effort to discredit the super-bears, have a real clue to what the WLI is all about. We created the WLI not to be an infallible, stand-alone recession-forecasting machine, but as one small part of a much larger array of leading indexes (each made up of many economic indicators) — like the especially prescient U.S. Long Leading Index. This array amounts to a sophisticated sequential signaling system of the economy’s cyclical turning points. The WLI is designed to be interpreted in this broader context, and its message today is quite simple: A slowdown in U.S. economic growth is imminent, but a new recession is not.
Tuesday, June 22, 2010
bp Chart, for Estragon
Here is a chart of bp, courtesy of AmenRa -
"BP
Spinning top day. Almost an inverted hammer (I said almost). Still trapped by candle body from the long down day on 6/9/10. Still below the 0.0% retrace. Still below EMA(10). No daily 3LB changes (reversal is 43.86)."
On Jun 22, 2010, at 4:29 PM, Estragon wrote: "Does BP go up or down tomorrow?"
reply...
"BP
Spinning top day. Almost an inverted hammer (I said almost). Still trapped by candle body from the long down day on 6/9/10. Still below the 0.0% retrace. Still below EMA(10). No daily 3LB changes (reversal is 43.86)."
On Jun 22, 2010, at 4:29 PM, Estragon wrote: "Does BP go up or down tomorrow?"
reply...
Who knows?
If they start collecting "all the oil", then good chance of up
Commodity complex incl oil will likely pull back, maybe hard, if so, bp goes down tomorrow with the rest...
The markets in general (read SPX) are teetering - scrimage line at 1100 with bulls and bears pushing each other back and forth between 1050 and 1150. Break below 1050-1040 then it is a free fall to 950, if that does not hold, 875. On the upside, we probably don't see 1250 again this year...but, never say never
Sunday, June 20, 2010
Surfs UP
Dig your Cool new ID Photo.
"Time to go to the Sea."
HD Video shot with a Canon 35MM SLR camera in waterproof housing.
Time to Go in the SEA! from allan wilson on Vimeo.
BP Ignored the Omens of Disaster
You've read it from me...
http://www.nytimes.com/2010/06/19/business/19nocera.html
TUESDAY, MAY 11, 2010
and here,THURSDAY, MAY 20, 2010
Now, read it from Joe Nocera of the NYT...
“We have to get the priorities right,” the chief executive of BP said. “And Job 1 is to get to these things that have happened, get them fixed and get them sorted out. We don’t just sort them out on the surface, we get them fixed deeply.”...It was bringing in a new man to head its American operations — the source of most of the company’s problems — who would make safety his top priority. And on, and on.
....the interview took place nearly four years ago, after BP’s previous disaster on American soil, when oil was discovered leaking from a 16-mile stretch of corroded BP pipeline in Prudhoe Bay in Alaska. And that was just a year after a BP refinery explosion in Texas City, Tex., killed 15 workers and injured hundreds more.
Mr. Browne had built BP by taking over other oil companies, like Amoco in 1998, and then ruthlessly cutting costs, often firing the acquired company’s most experienced engineers. Taking shortcuts was ingrained in the company’s culture, and everyone in the oil business knew it.
Compare that to BP’s record these last four years. On Thursday, during his day before an angry House energy subcommittee, Mr. Hayward was confronted with the fact that BP had been cited by the Occupational Safety and Health Administration for 760 “egregious willful” safety violations in its refineries. Mr. Hayward tried to slough this off by claiming that the violations had taken place in 2005 and 2006 — before, that is, he became chief executive and brought his “laser focus” on safety.
But Mr. Hayward was not telling the truth. According to the Center for Public Integrity, which obtained the data under the Freedom of Information Act, the violations all took place between 2007 and 2010, very much on Mr. Hayward’s watch. What’s more, the company violated something called O.S.H.A.’s “process safety management standard”...put a fork in 'em
http://www.nytimes.com/2010/06/19/business/19nocera.html
Sunday Jazz Interlude
William John Evans, known as Bill Evans (August 16, 1929 – September 15, 1980) was an American jazz pianist. His use of impressionist harmony, inventive interpretation of traditional jazz repertoire, and trademark rhythmically independent, "singing" melodic lines influenced a generation of pianists including: Chick Corea, Herbie Hancock, John Taylor, Steve Kuhn, Don Friedman, Denny Zeitlin, Bobo Stenson, Michel Petrucciani and Keith Jarrett, as well as guitarists Lenny Breau, Ralph Towner, John McLaughlin, and Pat Metheny. The music of Bill Evans continues to inspire younger pianists like Marcin Wasilewski, Fred Hersch, Bill Charlap, Lyle Mays, Eliane Elias[1] and arguably Brad Mehldau,[2]early in his career.Evans is an inductee of the Down Beat Jazz Hall of Fame.[3]
Friday, June 18, 2010
...from Zero Hedge...bp oil spill and financial crisis
Guest Post: What Do BP And The Banks Have In Common? The Era Of Corporate Anarchy
Submitted by Gonzalo Lira
(Update: I've cut material which I cannot support with convincing, unequivocal evidence regarding BP's actions immediately following the disaster of the Deepwater Horizon. These edits do not change or detract from the points about corporate anarchy that I am trying to make. Additionally, at the end of this piece, I provide a short discussion of BP share prices in NYSE and FTSE.)
On the occasion of the BP oil spill disaster, President Obama's delivered an Oval Office speech last night—a masterpiece of milquetoast faux-outrage. The speech was all about "clean energy" and "ending our dependence on fossil fuels". Faced with the BP oil spill—likely the most severe environmental disaster ever—this was President Obama's response: Polite outrage, and vague plans to "get tough", "set aside just compensation" and "do something".
President Obama missed what the BP oil spill disaster is really about. Though unquestionably an environmental disaster, the BP oil spill is much much more.
The BP oil spill is part of the same problem as the financial crisis: They are two examples of the era we are living in, the era of corporate anarchy.
In a nutshell, in this era of corporate anarchy, corporations do not have to abide by any rules—none at all. Legal, moral, ethical, even financial rules are irrelevant. They have all been rescinded in the pursuit of profit—literally nothing else matters.
As a result, corporations currently exist in a state of almost pure anarchy—but an anarchy directly related to their size: The larger the corporation, the greater its absolute freedom to do and act as it pleases. That's why so many medium-sized corporations are hell-bent on growth over profits: The biggest of them all, like BP and Goldman Sachs, live in a positively Hobbesian State of Nature, free to do as they please, with nary a consequence.
The added bonus to this, though, is that the largest corporations have convinced the governments and the people of the "Too Big To Fail" fallacy—they have convinced the world that if they cease to exist, the sky will fall atop our collective heads. So if they fail, they must be saved—without argument, without penalty, and without reform.
Let's take BP: British Petroleum caused the Deepwater Horizon oil spill in the Gulf of Mexico. There were various Federal Government agencies charged with supervising their operations—but all of those agencies deferred to BP, before the accident. As a large corporation—one of the largest oil companies in the world—BP operated more or less without any Government supervision. As is emerging, because of this lax and toothless supervision, safety rules and procedures were ignored. Insane risks were taken. No safety contingency plans were drawn up.
From what some memos are saying, disaster was inevitable.
Once the accident happened, BP controlled the information it released concerning the disaster. BP unilaterally decided not to inform the general public, or allow independent scientists to see the raw data or take independent measurements. In the initial stages of the disaster—before it had become a political maelstorm—the decisions and course of action in dealing with the oil spill were determined solely by BP, while the general public and the U.S. government were pretty much left in the dark. This is akin to someone whose apartment has caught fire, but who decides to put out the fire himself with his own garden-hose, and refuses to either inform the other tenants of the building of the extent of the fire, or allow the authorities to provide assistance or supervision.
Where was Authority? Where was Someone In Charge? The fact was, there was no one in charge. There was no one supervising—or at any rate, the ones who were supposed to be supervising had had their teeth yanked. And BP knew it—so they did whatever they wanted, regardless of the risks, or the costs.
Worst of all, BP realizes that, if it finally cannot get a handle on the oil spill disaster, they can simply fob it off on the U.S. Government—in other words, the people of the United States will wind up cleaning BP's mess. BP knows that no one will hold it accountable—BP knows that it will get away with it.
No one was holding the banks accountable either. It's no accident that American and European banks nearly went broke, but banks here in Chile sailed along smoothly: That's because banks here are regulated up the wazoo. They literally can't fart without an independent banking inspector supervising them, and then getting a stamped form in triplicate. When Chile's banks went bust in the crisis of 1980, it put paid to any illusions that the banks knew what they were doing—the government bailed out the banks then, but kept them under glass ever after.
But in Europe and America, the story was the Greenspan Put. Easy Al was so convinced that the banks would "self-regulate" that he pulled the teeth of the Fed, the banks regulatory agency, and let the "free market" have its way.
With this free pass, what do you think the banks did? They went anarchic—they invented all sorts of clever "financial products" that exponentially increased risk, rather than mitigating it. We all saw how that movie ended. When Lehman busted and the credit markets froze, a slap-dash improvised "rescue package" was drawn up, then the $700 billion TARP, then Quantitative Easing, all of these efforts lubed up with a lot of talk to "strengthening the regulatory environment" and "protecting the financial markets".
The upshot? The banks did whatever they pleased—with no supervision. And when their recklessness led inevitably to the catastrophe in the Fall of '08, the banks got bailed out—with no repercussions. The biggest ones even managed to turn a profit off the tax payer-funded bail-outs!
Even after the worst of the crisis—when the effects of no regulation and no supervision were clearly understood—nothing happened. The zero-regulation, zero-supervision regime continued.
This isn't the case for people, for individuals: People are regulated, people are controlled. Individuals are supervised and limited in what they can do and say—and no one complains. On the contrary—everyone is relieved, because it protects us all from the unreasonable behavior of an individual.
As an individual, I am limited in countless ways, from the trivial, like jaywalking, to the severe, like murder. I can't even speak up and yell "Fire!" in a crowded theater—I would be arrested for inciting a panic, the general good of avoiding a potentially lethal stampede overriding my need to express myself by yelling "Fire!" when there is none.
Curiously, individuals—ordinary people—are being supervised and regulated more and more stringently. Yet at the same time, corporations are becoming more and more free to do as they please. No one notices how strange this is—we have even lost the social framework to even talkabout regulating and supervising corporations, because too many foolish pundits equate supervision and regulation with Socialism. Yet curiously, personal freedom is being chipped away, day by day, without a peep from these self-same "freedom-loving" pundits.
Meanwhile, the banks run amok.
Meanwhile, BP runs amok.
We can look at other industries—Big Pharma, for one—but there's no real need: Big Pharma will fit the same pattern as BP and the banks. Get so big that you can do whatever you want, and no one will challenge you, not even the government. Carry out practices that will inevitably create a crisis—like unsafe drilling, like toxic bonds—and be confident that you will be bailed out.
Bailed out, and allowed to continue, unfettered. "Allowed" to continue, unfettered? I'm sorry, I mis-spoke: Encouraged to continue, unfettered. After all, the banks continued with their practices, and added some predatory new ones for good measure. And though there was talk of a moratorium on deep-water off-shore drilling, more drilling seems to be apace ("Drill, baby! Drill!!").
This era of corporate anarchy is reaching a crisis point—we can all sense it. Yet the leadership in the United States and Europe is making no effort to solve the root problem. Perhaps they don't see the problem. Perhaps they are beholden to corporate masters. Whatever the case, in his speech, President Obama made ridiculous references to "clean energy" while ignoring the cause of the BP oil spill disaster, the cause of the financial crisis, the cause of the spiralling health-care costs—the corporate anarchy that underlines them all.
This era of corporate anarchy is wrecking the world—literally, if you've been tuning in to images of the oil billowing out a mile down in the Gulf of Mexico.
I think we are at the fork in the road: One path leads to revolutionary change, if not outright revolution. The other, appeasement and stasis, as the corporations grind the country down.
My own sense is, there will be no revolutionary change. The corporations won. They won when they convinced the best and brightest—of which I used to be—that the only path to success was through a corporate career. No necessarily through for-profit corporations—Lefties never seem to quite get how pernicious and corporatist the non-profits really are; or perhaps they do know, but are clever enough not to criticize them, since those non-profits and NGO's pay for their meals.
Obama is a corporatist—he's one of Them. So there'll be more bullshit talk about "clean energy" and "energy independence", while the root cause—corporate anarchy—is left undisturbed.
Once again: Thank God I no longer live in America. It's too sad a thing, to watch while a great nation slowly goes down the tubes.
—————————————
Parenthetically, regarding BP’s share price:
Between April 20, the date of the disaster, and May 12, the release of the video feed of the broken pipe which we all know so well, the price of BP shares (NYSE) slid in a very slow, very controlled manner, from 60 to 48.5—that is, just shy of 20% in three weeks. The volume of shares spiked to 157 million on May 3 (share price 50), following a run-up in volume on the previous three trading days; before that, volume had fluctuated between 5 and 10 million shares a day. Then, after the release of the live video feed on May 12, which only happened after severe congressional pressure, the stock plummeted to 29 by June 9—an additional 40% in four weeks, on volume roughly averaging 25 million shares per day, with spikes recently as high as 200 million shares.
In London’s FTSE, the initial spike in share volume was slightly earlier—April 30, there were 165 million shares traded at 576 pc. To compare, on April 21, the share price was 651 pc, on volume of 23 million shares; before the disaster, volume was between 15 and 30 million shares daily.
Without question, senior BP execs and the mutual funds with large BP positions would have known the true extent of the disaster almost immediately after the Deepwater Horizon went down. Presumably, while the true extent of the disaster was withheld from the general public, these corporate players would have had time to get out of BP stock. This is a reasonable inference—or else why keep the video feed under wraps for close to a month? Why prohibit independent scientists from measuring the flow-rate of the leak?
(Update: I've cut material which I cannot support with convincing, unequivocal evidence regarding BP's actions immediately following the disaster of the Deepwater Horizon. These edits do not change or detract from the points about corporate anarchy that I am trying to make. Additionally, at the end of this piece, I provide a short discussion of BP share prices in NYSE and FTSE.)
On the occasion of the BP oil spill disaster, President Obama's delivered an Oval Office speech last night—a masterpiece of milquetoast faux-outrage. The speech was all about "clean energy" and "ending our dependence on fossil fuels". Faced with the BP oil spill—likely the most severe environmental disaster ever—this was President Obama's response: Polite outrage, and vague plans to "get tough", "set aside just compensation" and "do something".
President Obama missed what the BP oil spill disaster is really about. Though unquestionably an environmental disaster, the BP oil spill is much much more.
The BP oil spill is part of the same problem as the financial crisis: They are two examples of the era we are living in, the era of corporate anarchy.
In a nutshell, in this era of corporate anarchy, corporations do not have to abide by any rules—none at all. Legal, moral, ethical, even financial rules are irrelevant. They have all been rescinded in the pursuit of profit—literally nothing else matters.
As a result, corporations currently exist in a state of almost pure anarchy—but an anarchy directly related to their size: The larger the corporation, the greater its absolute freedom to do and act as it pleases. That's why so many medium-sized corporations are hell-bent on growth over profits: The biggest of them all, like BP and Goldman Sachs, live in a positively Hobbesian State of Nature, free to do as they please, with nary a consequence.
The added bonus to this, though, is that the largest corporations have convinced the governments and the people of the "Too Big To Fail" fallacy—they have convinced the world that if they cease to exist, the sky will fall atop our collective heads. So if they fail, they must be saved—without argument, without penalty, and without reform.
Let's take BP: British Petroleum caused the Deepwater Horizon oil spill in the Gulf of Mexico. There were various Federal Government agencies charged with supervising their operations—but all of those agencies deferred to BP, before the accident. As a large corporation—one of the largest oil companies in the world—BP operated more or less without any Government supervision. As is emerging, because of this lax and toothless supervision, safety rules and procedures were ignored. Insane risks were taken. No safety contingency plans were drawn up.
From what some memos are saying, disaster was inevitable.
Once the accident happened, BP controlled the information it released concerning the disaster. BP unilaterally decided not to inform the general public, or allow independent scientists to see the raw data or take independent measurements. In the initial stages of the disaster—before it had become a political maelstorm—the decisions and course of action in dealing with the oil spill were determined solely by BP, while the general public and the U.S. government were pretty much left in the dark. This is akin to someone whose apartment has caught fire, but who decides to put out the fire himself with his own garden-hose, and refuses to either inform the other tenants of the building of the extent of the fire, or allow the authorities to provide assistance or supervision.
Where was Authority? Where was Someone In Charge? The fact was, there was no one in charge. There was no one supervising—or at any rate, the ones who were supposed to be supervising had had their teeth yanked. And BP knew it—so they did whatever they wanted, regardless of the risks, or the costs.
Worst of all, BP realizes that, if it finally cannot get a handle on the oil spill disaster, they can simply fob it off on the U.S. Government—in other words, the people of the United States will wind up cleaning BP's mess. BP knows that no one will hold it accountable—BP knows that it will get away with it.
No one was holding the banks accountable either. It's no accident that American and European banks nearly went broke, but banks here in Chile sailed along smoothly: That's because banks here are regulated up the wazoo. They literally can't fart without an independent banking inspector supervising them, and then getting a stamped form in triplicate. When Chile's banks went bust in the crisis of 1980, it put paid to any illusions that the banks knew what they were doing—the government bailed out the banks then, but kept them under glass ever after.
But in Europe and America, the story was the Greenspan Put. Easy Al was so convinced that the banks would "self-regulate" that he pulled the teeth of the Fed, the banks regulatory agency, and let the "free market" have its way.
With this free pass, what do you think the banks did? They went anarchic—they invented all sorts of clever "financial products" that exponentially increased risk, rather than mitigating it. We all saw how that movie ended. When Lehman busted and the credit markets froze, a slap-dash improvised "rescue package" was drawn up, then the $700 billion TARP, then Quantitative Easing, all of these efforts lubed up with a lot of talk to "strengthening the regulatory environment" and "protecting the financial markets".
The upshot? The banks did whatever they pleased—with no supervision. And when their recklessness led inevitably to the catastrophe in the Fall of '08, the banks got bailed out—with no repercussions. The biggest ones even managed to turn a profit off the tax payer-funded bail-outs!
Even after the worst of the crisis—when the effects of no regulation and no supervision were clearly understood—nothing happened. The zero-regulation, zero-supervision regime continued.
This isn't the case for people, for individuals: People are regulated, people are controlled. Individuals are supervised and limited in what they can do and say—and no one complains. On the contrary—everyone is relieved, because it protects us all from the unreasonable behavior of an individual.
As an individual, I am limited in countless ways, from the trivial, like jaywalking, to the severe, like murder. I can't even speak up and yell "Fire!" in a crowded theater—I would be arrested for inciting a panic, the general good of avoiding a potentially lethal stampede overriding my need to express myself by yelling "Fire!" when there is none.
Curiously, individuals—ordinary people—are being supervised and regulated more and more stringently. Yet at the same time, corporations are becoming more and more free to do as they please. No one notices how strange this is—we have even lost the social framework to even talkabout regulating and supervising corporations, because too many foolish pundits equate supervision and regulation with Socialism. Yet curiously, personal freedom is being chipped away, day by day, without a peep from these self-same "freedom-loving" pundits.
Meanwhile, the banks run amok.
Meanwhile, BP runs amok.
We can look at other industries—Big Pharma, for one—but there's no real need: Big Pharma will fit the same pattern as BP and the banks. Get so big that you can do whatever you want, and no one will challenge you, not even the government. Carry out practices that will inevitably create a crisis—like unsafe drilling, like toxic bonds—and be confident that you will be bailed out.
Bailed out, and allowed to continue, unfettered. "Allowed" to continue, unfettered? I'm sorry, I mis-spoke: Encouraged to continue, unfettered. After all, the banks continued with their practices, and added some predatory new ones for good measure. And though there was talk of a moratorium on deep-water off-shore drilling, more drilling seems to be apace ("Drill, baby! Drill!!").
This era of corporate anarchy is reaching a crisis point—we can all sense it. Yet the leadership in the United States and Europe is making no effort to solve the root problem. Perhaps they don't see the problem. Perhaps they are beholden to corporate masters. Whatever the case, in his speech, President Obama made ridiculous references to "clean energy" while ignoring the cause of the BP oil spill disaster, the cause of the financial crisis, the cause of the spiralling health-care costs—the corporate anarchy that underlines them all.
This era of corporate anarchy is wrecking the world—literally, if you've been tuning in to images of the oil billowing out a mile down in the Gulf of Mexico.
I think we are at the fork in the road: One path leads to revolutionary change, if not outright revolution. The other, appeasement and stasis, as the corporations grind the country down.
My own sense is, there will be no revolutionary change. The corporations won. They won when they convinced the best and brightest—of which I used to be—that the only path to success was through a corporate career. No necessarily through for-profit corporations—Lefties never seem to quite get how pernicious and corporatist the non-profits really are; or perhaps they do know, but are clever enough not to criticize them, since those non-profits and NGO's pay for their meals.
Obama is a corporatist—he's one of Them. So there'll be more bullshit talk about "clean energy" and "energy independence", while the root cause—corporate anarchy—is left undisturbed.
Once again: Thank God I no longer live in America. It's too sad a thing, to watch while a great nation slowly goes down the tubes.
—————————————
Parenthetically, regarding BP’s share price:
Between April 20, the date of the disaster, and May 12, the release of the video feed of the broken pipe which we all know so well, the price of BP shares (NYSE) slid in a very slow, very controlled manner, from 60 to 48.5—that is, just shy of 20% in three weeks. The volume of shares spiked to 157 million on May 3 (share price 50), following a run-up in volume on the previous three trading days; before that, volume had fluctuated between 5 and 10 million shares a day. Then, after the release of the live video feed on May 12, which only happened after severe congressional pressure, the stock plummeted to 29 by June 9—an additional 40% in four weeks, on volume roughly averaging 25 million shares per day, with spikes recently as high as 200 million shares.
In London’s FTSE, the initial spike in share volume was slightly earlier—April 30, there were 165 million shares traded at 576 pc. To compare, on April 21, the share price was 651 pc, on volume of 23 million shares; before the disaster, volume was between 15 and 30 million shares daily.
Without question, senior BP execs and the mutual funds with large BP positions would have known the true extent of the disaster almost immediately after the Deepwater Horizon went down. Presumably, while the true extent of the disaster was withheld from the general public, these corporate players would have had time to get out of BP stock. This is a reasonable inference—or else why keep the video feed under wraps for close to a month? Why prohibit independent scientists from measuring the flow-rate of the leak?
Thursday, June 17, 2010
Hugh Hendry is the Man, again, as always
Hugh Hendry Busts Out Tolstoy, TS Eliot, And Buchan To Win An Argument At Hedge Fund Conference
Eclectica's Hugh Hendry and Mike Novogratz, principal of Fortress Investment Group, got into a war of the words yesterday at one of the hedge fund industry's biggest conferences, GAIM.Hendy's used to fighting (and winning) with professors, who he seems to think are useless as economic commentors.
But according to the GAIM conference's blog, Hendry had to bust out the big boy refences to win the prize for the smartest argument against Novogratz and started quoting ts eliot, Buchan and Tolstoy.
He said that he had had to face the twin axis of financial evil that is Germany and France, transporting himself across the European Socialist citadel (we think that's the reference to Tolstoy's War and Peace) to get to our stage.
“The Euro is finished” he concluded. He said gold should be 10% of a fund's assets.
“In the long run, there will be a bail out” he said. “The Euro will go lower and there will be more European political mishaps before they get bailed out.” Novogratz proposed a long Sterling versus the Euro trade.
Novogratz believes that we are on a global mega trend of globalisation with the so-called emerging markets coming to the fore. “That force could carry us through” he said.
But Hendry came out on top adding these two super-smart allusions:
Hendry’s referenced Buchan's Gap In The Curtain to explain our inability to see into the future or what would happen if we were able to.
“How does life play out?” he asked, and answered himself: “In our haste to make money, we rush to the end.”
And there, we may find, he said, Eliot’s Wilderness of Mirrors, which is a reference to Eliot's poem, Gerontion.
Now watch a really great fight with Hendry against Joe Stigli
Read more: http://www.businessinsider.com/hugh-hendry-mike-novogratz-gaim-2010-6#ixzz0rAE89Ba2
UFB
Now, who could outdo, out perform sterling Tony Hayward - just a drop in a big sea, i want my life back...?
None other than his Chairman, Carl-Henric Svanberg ...UFB, "the small people" of coastal LA....
...and perhaps O...unfortunately
Also, i do not think there is a lot of British bashing/hating, it is bp bashing and hating...and, the Brits have a big chip on their shoulder...it is not "British Petroleum", you know old chap...and it was the contactors fault, of course...yeah right
None other than his Chairman, Carl-Henric Svanberg ...UFB, "the small people" of coastal LA....
...and perhaps O...unfortunately
Also, i do not think there is a lot of British bashing/hating, it is bp bashing and hating...and, the Brits have a big chip on their shoulder...it is not "British Petroleum", you know old chap...and it was the contactors fault, of course...yeah right
Monday, June 14, 2010
EUR-USD Squeeeeze and Sleight of Hand
Surge In European Bank Rush To Safety Brings ECB Deposit Facility Holdings To Fresh €384 Billion Record
Submitted by Tyler Durden on 06/14/2010 07:14 -0500
Even as Goldman is urgently forcing a EURUSD squeeze following its last week target revision lower to 1.15 (just as predicted on Zero Hedge), in an attempt to shake out the latest batch of weak hands (aka clients) in the second highest EURUSD net short position last week, forcing all correlation desks to bid up all risky assets and pretend all is good, Europe liquidity is now even more frozen than ever before. While earlier reports from the FAZ that Spain is next in line for the EU/IMF rescue facility may or may not be true (very likely the former, but no confirmation will be provided until after the fact), looking at the ECB's deposit facility usage paints a grim picture: usage increased by $18.4 billion through the weekend, and was at an all time high €384 billion: European banks have put aside nearly half a trillion dollars away due to concerns about counterparty risk. For those still confused why this data series indicates that the FV of the EURUSD is likely close to or at parity, the topic of the ECB's deposit facility usage was covered exhaustively by Bloomberg overnight in "Europe's Banks May Face Second Funding Squeeze Amid Sovereign-Debt Crisis."
...now, with all eyes on the PIIGS...
The cat is clearly out of the bag concerning the forthcoming bankruptcy of 33 states of the USA.
This moronic New York non-solution to borrow from state pension funds, which now cannot meet their pension requirements, screams bankruptcy. The Administration calling for $50 billion for states and cities would appear to be confirmation of this financial phenomenon. The sign that the financial problems of the states of the USA are going critical and will make the EU situation look like kindergarten, in market terms, will be a stronger euro and stronger gold, sort of like now (9:09 EST).
A shift in the recent relationship between gold and the euro would signal that recognition by markets.
State Plan Makes Fund Both Borrower and Lender
By DANNY HAKIM
Published: June 11, 2010
ALBANY - Gov. David A. Paterson and legislative leaders have tentatively agreed to allow the state and municipalities to borrow nearly $6 billion to help them make their required annual payments to the state pension fund.
And, in classic budgetary sleight-of-hand, they will borrow the money to make the payments to the pension fund - from the same pension fund.
As word of the plan spread, some denounced it as a shell game and a blatant effort by state leaders to avoid making difficult decisions, like cutting government spending or reducing pension benefits.
"It's a classic Albany example of kicking the can down the road," said Harry Wilson, the Republican candidate for comptroller, who holds an M.B.A. from Harvard.
Pension costs for the state and municipalities are soaring, a result of enhanced retirement benefits for public employees and the decline in the stock market over the past two years. And, given declines in tax revenue and larger budget shortfalls, the governments are struggling to come up with the money to make the contributions.
Under the plan, the state and municipalities would borrow the money to reduce their pension contributions for the next three years, in exchange for higher payments over the following decade. They would begin repaying what they borrowed, with interest, in 2013.
More...
Saturday, June 12, 2010
Need for Speed2
Race Weekend. LeMans 24 hour , Peugeot battling Audi, Diesels rule. I am looking forward to Petit LeMans in Atlanta http://www.roadatlanta.com/ev_petit.lasso
GP of Canada @ Montreal, Schumacher has winning record at this track.
Tyler Dueck - Le Mans Racing Promo Teaser from Streetlight Creative on Vimeo.
Friday, June 11, 2010
Wednesday, June 9, 2010
Friday, June 4, 2010
Critérium du Dauphiné
The 62nd edition of the Critérium du Dauphiné will take place starting 6th June 2010 and finishing on 13th June. The race organizer is now Amaury Sports (the folks that stage Le Tour) taking over from the regional newspaper that ran the event Le Daupine' Libere' for the past 61 years.
In 1998, Judy and I had a holiday in France and were able to witness two stages of the Dauphine. And it was very cool by the way. We were in the alps in a chalet with a great view of Mount Blanc. We were in a town called Combloux, which is next to Megeve where we saw the arrive' of one stage that was won by Richard Virenque up the top of the ski slope. Then the next stage started and finished in Megeve. So, we were able to visit the starting village, the riders sign-in and the start. When they riders returned, we observed the show, and it is a show - the cars with the podium girls and celebrity guests, the motorcycles, the officials, etc...come through at least 1/2-3/4 hour before the racers honking their horns and making all kinds of commotion..it is a circus to be sure, a traveling circus. After the riders came through - we observed them coming up a short steep climb, we got in the car and drove to the finish line in Megeve, We just missed the podium awards, but had a good time nonetheless.
Prologue
Stage 1
Stage 2
Stage 3
Stage 4
Stage 5
Stage 6
Stage 7This is a traditional warm-up and test of conditioning for the riders prior to le Tour de France. This year it looks as though it is Alberto Contador's race to lose. He is far and away the favorite. Denis Menchov and Sammy Snachez will also race, but. their chances of beating Contador are slim to none. The race will feature the storied climb up the 21 switchbacks of L' Alpe d' Huez on the penultimate day. There will also be a fairly long time trial, in which it will be interesting to see how Contador's ITT skills have developed.
In 1998, Judy and I had a holiday in France and were able to witness two stages of the Dauphine. And it was very cool by the way. We were in the alps in a chalet with a great view of Mount Blanc. We were in a town called Combloux, which is next to Megeve where we saw the arrive' of one stage that was won by Richard Virenque up the top of the ski slope. Then the next stage started and finished in Megeve. So, we were able to visit the starting village, the riders sign-in and the start. When they riders returned, we observed the show, and it is a show - the cars with the podium girls and celebrity guests, the motorcycles, the officials, etc...come through at least 1/2-3/4 hour before the racers honking their horns and making all kinds of commotion..it is a circus to be sure, a traveling circus. After the riders came through - we observed them coming up a short steep climb, we got in the car and drove to the finish line in Megeve, We just missed the podium awards, but had a good time nonetheless.
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