TODAY, OCTOBER 27, 2

HedgeCO Net - In a discussion with Jim Puplava, FS Radio, Jeffrey Brown described his analytical work with Dr. Samuel Foucher, also part of logi Energy, where they determined that annual production in Saudi Arabia has never exceeded the production in 2005 and believe it never will.

Jeffrey went on to discuss his land export model and the ramifications of depleting oil fields and increasing demands within exporting countries by their own citizens. He and Dr. Foucher have determined, through deep analytics, that the exports from the top 5 exporting countries has peaked and half of all oil ever to be exported after 2005 by these countries will be exported within 4 years, by 2013.

Berlin | October 23

BBC - A group of rich Germans has launched a petition calling for the government to make wealthy people pay higher taxes.

The group say they have more money than they need, and the extra revenue could fund economic and social programmes to aid Germany's economic recovery.

Ashley Seager, Julia Kollewe & Kathryn Hopkins | London | October 23

The Guardian - The British economy is mired in its longest recession on record, as government figures out this morning showed a shock 0.4% drop in gross domestic product (GDP) in the third quarter of the year.

The figures confounded widespread hopes that the economy had returned to growth after five consecutive quarters of recession.

City economists had almost unanimously expected a small increase in GDP. Quarterly records go back to 1955 and show there has never until now been six quarters of contraction in a row.

Ashley Seager | Oct 20

The Guardian - * US light crude oil futures pushes above $79 a barrel
* Report blames government for ignoring supply problem

World oil prices hit their highest point for a year yesterday, as a major new report urged governments around the world to take drastic action to head off an approaching oil supply crunch.

US light crude futures pushed above $79 a barrel, supported by the view that a recovering world economy would raise demand for crude. Oil prices have more than doubled from the low point they hit in the spring, but are still around half the all-time high of nearly $150 a barrel they reached in early summer last year.

Analysts have been surprised at the recent resilience of oil prices given the impact on energy demand of the global recession. In spite of this year's volatility in the oil price, the underlying trend for a decade has been for it to rise steadily.

A report from the non-governmental organisation Global Witness – famous for its exposé of so-called "blood diamonds" – pointed to an impending supply shock that could be so severe that many of the world's poor countries would simply be shut off from the world of energy by sky-high prices.

Two years in the preparation, Global Witness's report, Heads in the Sand, accused governments of ignoring the fact that the world could soon start to run short of oil. This would lead to huge consequences in terms of price shocks and much higher levels of violence around the world than last year's food riots.

The Report: Heads in the Sand: Governments Ignore the Oil Supply Crunch and Threaten the Climate

I have some sympathy for a weak-dollar policy. But I have one question, which arises out of this graf from Dean Baker over at the Guardian:

Suppose that the Fed doesn't intervene and lets interest rates rise. This will have some negative impact on growth, but there will also be a very positive side from China's decision to stop buying dollars. The dollar would fall in value against China's currency. This would make Chinese goods more expensive in the United States, leading US consumers to purchases fewer imports from China and more domestically produced goods.

My question: what domestically produced goods would we buy? Seriously, as I mentioned in an earlier post, our manufacturing capacity has been eviscerated the last fifteen years. We can't buy our own weapons, can we?

Really, it's a serious question, one I would love for someone to answer: what do we produce that could replace the cheap goods that China makes?

Ramita Navai | Washintsa, Peru | October 9

The Times - They emerged from the thick, green jungle clenching their spears: a long file of barefoot chiefs and elders, their faces painted with their tribal markings and crowns of red, blue and yellow parrot feathers.

They had been summoned by the chief of Washintsa village for a meeting to discuss an oil company’s efforts to buy the rights to their land. Most had travelled for hours, padding silently through the dark undergrowth.

Pittsburgh | September 24

BBC - Trouble has flared as world leaders gather in the US city of Pittsburgh for the G20 summit.

Reports said riot police used pepper gas and fired rubber bullets at protesters on a march near the venue.

The man who saw the meltdown coming had another troubling insight: it will happen again

The Boston Globe, By Stephen Mihm, September 13

Since the global financial system started unraveling in dramatic fashion two years ago, distinguished economists have suffered a crisis of their own. Ivy League professors who had trumpeted the dawn of a new era of stability have scrambled to explain how, exactly, the worst financial crisis since the Great Depression had ambushed their entire profession.

Amid the hand-wringing and the self-flagellation, a few more cerebral commentators started to speak about the arrival of a “Minsky moment,” and a growing number of insiders began to warn of a coming “Minsky meltdown.”

The newest and increasingly favored blogger on my RSS Feed is J.R. Boyd, posting at Lady Poverty. His take on the Tea Party rallies is refreshing:

...By and large, these are working people with grievances stemming from economic hardship, who feel that government is too large and unresponsive, and otherwise fails to represent them. They have been organized to confront Obama on behalf of the same corporate concerns that pay Glenn Beck's salary and own his network. They articulate a general dissatisfaction with government in addressing their needs, then carp about "socialism" -- perhaps the natural enemy of the pro-business entertainer; not so much the average American trying to find a job.

From a class perspective, the interests of working people deserve to be consolidated and advanced by working people as a class. This means that people without work or without health care, or anyone vulnerable in this regard, have more important things in common than who they vote for, what God they worship, or whether or not they would have an abortion. After all, one does not go bankrupt and lose their home owing to their party affiliation, but thanks to a different set of relations entirely...

Click here to read the rest. I'd also recommend scrolling through some of his older posts--they tend to be short and to the point, with longer entries only appearing in the last couple weeks.

Washington | September 11

CBC - Children around the world are producing numerous goods being sold globally, says a report released by the U.S. Department of Labour.

The report released Thursday found that 218 million children work worldwide, and that 126 million of them perform dangerous jobs.

The U.S. Labour Department has identified 122 goods from 58 countries it believes to be produced by forced labour, child labour or a combination of the two. Children commonly work to produce products or crops such as: Cotton, Sugar cane, Tobacco, Coffee, Rice, Cocoa, Bricks, Garments, Carpets, Footwear, Gold, and Coal.

of Everything Economic entitled

How Did Economists Get It So Wrong?

http://www.nytimes.com/2009/09/06/magazine/06Economic-t.html?pagewanted=1&_r=1

"All I know is just what I read in the newspapers." - Will Rogers

Lots of sources reporting on China's derivative threat today. So where do I come for enlightenment? :-)

In short, the reports are that the Chinese have threatened to unilaterally terminate commodities contracts in an attempt to cut losses on derivatives. Lots of speculation amid a general selloff, but could this be the beginning of the next wave?

I stumbled across another bit of what I call awestruck OMG WTF reporting on hyperinflation episodes. Grr!

Why are people fascinated by huge inflation rates?

What should be fascinating them is where is the ownership of tangible assets moving within the country and where are the flows of hard currency across the borders going.

There is a common and racist view that despots who create hyper-inflation episodes are fools who don't understand economics.

Wrong.

They are not fools, they are dangerously smart, and they understand economics all too well.

By creating a period of hyper-inflation, they may destroy or badly damage a countries economy... but they can siphon all tangible assets out of _everyone_ elses pockets into the pockets of an elite few.

Both France and Germany reported 0.3% GDP figure for 2Q. I do not remember if France even had a recession.

Christopher Ketcham | Utah | August

Gentlemen's Quarterly - DANIEL SUELO LIVES IN A CAVE. UNLIKE THE average American—wallowing in credit-card debt, clinging to a mortgage, terrified of the next downsizing at the office—he isn't worried about the economic crisis. That's because he figured out that the best way to stay solvent is to never be solvent in the first place. Nine years ago, in the autumn of 2000, Suelo decided to stop using money. He just quit it, like a bad drug habit.

Ed Pilkington | New York | July 20

The Guardian - US census bureau report highlights shift in global population that may bring social and economic changes worldwide

The world is about to cross a demographic landmark of huge social and economic importance, with the proportion of the global population 65 and over set to outnumber children under five for the first time.

A new report by the US census bureau highlights a huge shift towards not just an ageing but an old population, with formidable consequences for rich and poor nations alike. The transformation carries with it challenges for families and policymakers, ranging from how to care for older people living alone to how to pay for unprecedented numbers of pensioners – more than 1 billion of them by 2040.

The report, An Aging World: 2008, shows that within 10 years older people will outnumber children for the first time. It forecasts that over the next 30 years the number of over-65s is expected to almost double, from 506 million in 2008 to 1.3 billion – a leap from 7% of the world's population to 14%. Already, the number of people in the world 65 and over is increasing at an average of 870,000 each month.

The report - An Aging World: 2008

The Economy Ministry in Berlin's experts have come to the conclusion that growth was exactly 0 percent for the second quarter.

Spiegel

US Q2 is expected to be -2%.

Corrente, By Stirling Newberry, July 9

It would be easy to hope that this downturn represents the final capitulation of the Bush years, and that once we work away the excess, that there will be a new age after it. However, this is not what the numbers indicate. While selling self-spin and hope may be the province of those who hope to curry favor with the powers that be, or with masses of people desperate to believe that this is as bad as it will get, hard slabs of reality are my stock and trade.

Let me introduce you to post-petroleum thesis.

Peter Popham | July 7

The Independent - The choice of L'Aquila to host this week's summit of world leaders has highlighted Italy's failure to help the victims of the quake

Silvio Berlusconi switched the location of the G8 summit to the city of L'Aquila as a way of focusing world attention on Italy's most disastrous earthquake for 30 years.

But as Hu Jintao, the General Secretary of the Chinese Communist Party, touched down in Rome yesterday, the first of 40 world leaders to arrive for the summit, residents were sceptical that the presence of so many grandees on their doorstop would do them much good.

...

But progress now appears to have ground to a halt, with attention more focused on cosmetic makeovers for the arrival of Barack Obama, Gordon Brown, Nicolas Sarkozy and the rest, according to Massimo Manieri, a spokesman for the Association for the Reconstruction of L'Aquila.

"The first phase of the emergency was great," he said. "But then the authorities made a massive mistake: instead of building temporary housing to get the homeless out of tents as fast as possible, they decided to skip that phase altogether and move to permanent housing immediately. But none of that has been built yet. I will be surprised if even a fraction of what is required is built by December."

Michael Janda | July 6

abc.net.au - A leading commodity forecast predicts that prices for many major Australian agricultural commodities will remain subdued over the next year. The Rabobank Agri Commodities Monthly report says that prices for wheat and oilseeds (such as canola) are likely to fall slightly lower over the near-term, before remaining flat later this year, and gradually recovering into 2010.

The bank says corn prices have been hit in large part by sales from speculators, and wheat prices have also been affected by the growing perception that the 'green shoots' of economic recovery in the US are actually yellow and stunted.

July 3

UPI - The Organization for Economic Cooperation and Development has agreed to allow Israel to become a member by 2010, a local media report said. A report in Ynetnews.com Thursday, said the agreement was secured in a meeting between Israeli Finance Minister Yuval Steinitz and OECD Secretary-General Angel Gurria, in Paris last week.

The report said the OECD is expected to release a full financial review of the Israeli market in November, an important step towards granting Israel full membership.

Israel has reportedly sought membership in the prestigious organization for 20 years, but was turned down because of political and economic reasons, the Web site said.

Sue Lannin | July 2

abc.net.au - A leaked report from the World Trade Organisation (WTO) says that nations are throwing up trade barriers in response to the global recession.{snip} WTO director-general Pascal Lamy says the global economy is fragile and that wealthy nations will see exports drop by 14 per cent this year, and that is not going to help the world recover from the worst downturn since the Great Depression.

Stephen Labaton | Washington | June 23

NYT - During the debate over financial regulation, the Federal Reserve chairman, Ben S. Bernanke, has been surprisingly quiet. But behind the scenes, he has been a forceful proponent of giving the Fed more power, both defending his management of the economic crisis and arguing that more authority would help the agency act more decisively to reduce the chances of a recurrence, according to interviews with lawmakers and officials from the Fed, the Treasury and the White House.

Despite criticism by some lawmakers that the Fed failed to anticipate the problems that led to the crisis, Mr. Bernanke has told associates that such critics fail to recognize the extraordinary actions taken by the central bank over the last year.

Mr. Bernanke believes the Fed’s actions have played a major role in averting a possible second Great Depression, according to government officials who know his thinking. Those steps, the Fed chairman has told these people, demonstrate that the agency is up to the larger task assigned to it by the Obama administration.

06/08/2009 15:18

http://www.asianews.it - Bonds worth US$ 134.5 billion are seized. This is the largest financial smuggling case in history. But are they real? Concern over ‘funny money’ or counterfeit securities is spreading in Asia. The international press is silent.

Milan (AsiaNews) – Italy’s financial police (Guardia italiana di Finanza) has seized US bonds worth US 134.5 billion from two Japanese nationals at Chiasso (40 km from Milan) on the border between Italy and Switzerland. They include 249 US Federal Reserve bonds worth US$ 500 million each, plus ten Kennedy bonds and other US government securities worth a billion dollar each.

David Leonhardt | Washington, DC | June 9

NYT - There are two basic truths about the enormous deficits that the federal government will run in the coming years.

The first is that President Obama’s agenda, ambitious as it may be, is responsible for only a sliver of the deficits, despite what many of his Republican critics are saying. The second is that Mr. Obama does not have a realistic plan for eliminating the deficit, despite what his advisers have suggested.