Thursday, June 30, 2011

In Cowtown for the day...

Iphone 4...

Monday, June 27, 2011

Suspended Agitation

     Woe is unto the world. It doesn't know whether to shit or go blind. The rule of law has been replaced by Murphy's Law. The story in Greece gets more and more curious. One of the latest proposals is to ask holders of Greek bonds to go along with a voluntary rollover, meaning we will pay you on Tuesday for a hamburger today, even though we already owe you for ten years of weekly hamburgers. 
     Odd how the financial innovation never ceases. This last great new idea: that bonds never really have to pay off, will do wonders for the bond market everywhere. People will clamor for bonds that come with no clear terms and probably no redemptions. Now, the buzz around the cosmic meme-sphere is saying fuggedabowt Greece, we're gonna do the same thing with Portugal and its sillyass bonds. Enter China.
     Europe is about to enjoy the greatest monetary Chinese fire drill ever staged. Wen Jiabao will wave a magic wand and the Euro will fly above mundane reality on dragon wings allowing everybody in Greece, Portugal, Spain, Ireland, and Italy to hold a senior management job at the motor vehicle bureau with retirement at 53.  Then, with 80 percent of their former pay, they can open cafes where people still working at the motor vehicle bureau can spend the better part of each afternoon sipping Ouzo and arguing politics, finance, sports... or just enjoying the antics of the boorish German tourists.
     Meanwhile, Goldman Sachs's man in Europe, Mario Draghi, will take a seat in Jean Trichet's big chair at the European Central Bank around November of this year. It was Goldman Sachs, apparently, that erected a giant credit default swap house of cards for Europe to live in happily-ever-after - except in the event of a default accident, in which case Goldman Sachs would receive all the money ever printed on God's green Earth, plus commissions, premiums, penalty payouts, interest, and bonuses... and homeless Europe would then be welcome to take a flying fuck at a rolling donut - or make that a strawberry Bismarck! Personally, I don't see how the various players can delay some sort of crisis until November. The European currency experiment is a bust and too many big banks are just plain insolvent. Can Wen Jiabao launch another flying dragon that seeds the European skies with counterparty payoffs that will rain down from Dublin to Athens and keep everybody happy?
    Don't get the idea that the USA can just occupy a grandstand seat and stuff its fat face with Cheez Doodles while the current act plays out in the center ring of the world financial circus. Plenty of intermingled American interests depend on how things work out over there, not the least of which is the fact that the International Monetary Fund is actually a proxy American bail-out operation. It worked just fine in the old days when its exertions focused on little urchin nations like Swaziland, but wait until the Tea Party hears that America runs twelve thousand cafes for European motor vehicle bureaucrats to while away the afternoons drinking Ouzo in. (At least maybe we can get them to drink Old Mr. Boston anisette liqueur instead.)
     It does prompt one to think we might try something like that here. Would it not improve the national character generally if our citizens spent more time arguing politics in cafes than lying on the couch watching a TV figment named "Snooki" throw standing crotch-locks on every unemployed forklift driver in the mythical kingdom of New Jersey? 
     If I were Barack Obama, I'd think twice about presiding over this irresolvable muddle of engineered swindles, sinking prospects, booby-trapped budgets, and played-out lies for another term. Let Hillary step in and try to keep this leaky Flying Dutchman out of the drink. She's looking more and more like Winston Churchill physically every day now, anyway. Maybe she is acquiring something like his stolid habits of mind, too. If I were President Obama, I'd just call it quits and sign on with the home team: Goldman Sachs. He can have Mario Draghi's old job - chief of the international division. They'll love him in all those peculiar little countries where people wear hats that look like rat-traps and flavor their beer with the cocoons of nectar-sipping moths. They'll enjoy it when he forecloses on them, and maybe even ask for more. "Here, take our grandchildren's baby teeth, too!" I wish him and his beautiful family well in their new life as distinguished private citizens-of-the-world. I just hope Michele Bachmann and her probable running mate, Jesus, don't steal the next election. They'll rip out the Obamas' vegetable garden and put a Nascar track there so that all of Ms. Bachmann's 27 children can have jobs selling miniature bibles in the parking lot. ("Prayed over by qualified preachers twenty-four hours a day!")
     By the by, many observers were amused by last week's cute trick of releasing sixty million barrels of oil from the world's strategic reserves at the rate of two million-a-day in an effort to pretend that the world doesn't have a basic oil production problem. It is, of course, at the bottom of the world's financial disarray, because if you can't increase energy inputs that feed an industrial economy you don't get growth and then the whole idea of compound interest falls apart because it is predicated on a perpetual increase in wealth.  Hence, debt collapses in on itself. The world is caught up in an epochal contraction now, and it manifests in situations like the Greek emergency. But soon it will be a universal emergency.
     The lesson, if I may be tendentious for moment, is that the human race is welcome at any time to begin living differently, at a smaller scale, much more locally, with fewer automatic machines doing all the work for us, and more time spent on useful and necessary activities than on television fantasies. Got a problem with oil? Don't imagine that you're going to run WalMart - or, for that matter, Goldman Sachs - on wheat-straw distillates. Something is in the air this week and it is making a lot of people very nervous. If you loaded up the old investment portfolio with shale gas stocks, I feel especially sorry for you.

Monday, June 20, 2011

Storms this late in June are pretty rare but maybe we'll get lucky for a couple of days...would be even better if it cooled things down for a couple of days...

Iphone 4

Up in Whitewright...

Man Down

     Last week, in an incident that didn't get much attention in the national news, a man named Tom Ball set himself on fire in front of the county courthouse in Keene, NH. He left a fifteen-page suicide note explaining his actions. He was angry at the state child protection bureaucracy and the courts after a ten-year battle over a child abuse charge that became, for him, a Kafkaesque struggle with cruel authority. The long suicide note he left was a thoughtful and disturbing indictment of the legal procedures now common across America that have had many unanticipated consequences - from breaking up families to homelessness - but it was also a grim comment on the condition of American manhood.
     A casual Martian observer hanging around any convenience store in the "fly-over" zones of this nation must be impressed with the striking way that American men present themselves to the world. Forgive me for revisiting an oft-dredged-up theme - male costuming and adornment in our time - but I wouldn't keep bringing it up if I didn't think it was significant. On the whole, American men present themselves as savages. I think they do it because they feel very insecure about themselves - similar to the insecurity that prompts a politician to wear a flag lapel pin. Should there be any doubt that an elected official cares about his country? Or maybe we should ask: what kind of country produces such craven, weak, pandering elected officials? What kind of culture produces men who get themselves up like chain-saw murderers?
     The same country that furnishes an endless diet of super-hero movies to pubescent males who are not expected to develop normal adult coping powers. The same country that supplies gruesome, sado-masochistic video games to occupy the idle hours of young men - and then lets them take those "skills" to some tilt-up bunker in Nevada where they sit in air-conditioned comfort and direct drone aircraft ten thousand miles away to incinerate suspected "enemies" in mud villages. (Sometimes "mistakes are made" and they blow up a wedding party or something - but the drone controllers still get to leave the bunker at the end of their shift and roll down the strip for a plastic tray full of burritos.)
     This month's WeinerGate was another instructive incident. Up-and-coming wonderboy politician revealed to be secret sex schlemiel, undone by "social media" - which turns out to have the unanticipated consequence of undermining the impulse control of supposedly grown men. Who knew? But what interested me more than Weiner's pitiful dishonesty was the parade of women journalists on cable TV news who all agreed that poor Weiner's downfall was yet another conclusive demonstration of how hopeless men are - not to mention that their male colleagues on-screen, Blitzer, King, O'Donnell, sheepishly agreed with them. This ceremonial posturing for moral brownie points in an extremely moralistic and puritanical culture does tend to obscure the reality that adult male humans are sexually alert in an inconvenient way that is not identical to the experience of females. Notwithstanding the evident insanity of Dominque Strauss-Kahn jumping the hotel maid, men sometimes make passes. American women cannot forgive them for this. Lesson: perhaps American men should not make such an effort to seek forgiveness. I am waiting, personally, for some Mark Sanford type (former South Carolina governor caught in "affair" with Argentine firecracker) to go before the microphones and say to media (and the voters), "this is none of your goddam business."
     Which brings me to the troublesome subject of gay marriage, which is lately up for debate in the legislature of New York State where I live, making it the public's business. I have an unpopular view of it for men of my demographic (Democrat, Boomer). I'm not in favor of it. I don't think it is a good idea. I don't have empirical proof, but I suspect that unsettling such an age-old and fundamental social arrangement will produce strange unanticipated consequences that we are not prepared for. I don't believe gay marriage is a genuine social justice issue. I think it is a bid for a kind of broad social approbation which does not require ritual enactment in law, and would be socially mischievous to pursue. Civil unions would cover the necessary legal issues. Otherwise, it is a case of unwarranted relativism, a Boomer weakness. Not all conditions or states of being in this world are the same. Some things are on the margins because they are marginal.
     What fascinates me in the debate is the narcissism of Boomers, males especially, who advocate so earnestly in favor of gay marriage. Is it really about the law and social relations, or is it about making yourself feel good?  Is it just more posturing for moral brownie points, for approval?  Is your job and social position or maybe even sense of yourself at stake if you have a differing view? 
     I had an interesting experience with my last two books (World Made By Hand and The Witch of Hebron), which were set in a post-oil, post economic collapse American future and depicted daily life in a way that was quite unlike the way we live right now. I received a heap of criticism from female readers - including peak oil activists - full of consternation that I did not present female characters in the kinds of dominant valorized roles that are favored today: the post-oil equivalent of CEO, news anchor, CIA-Ninja warrior, Presidential candidate. What struck me was their complete failure of imagination. They could not conceive of male / female relations that were different than today's, even in a world that had been turned economically upside down.
     However, this was not inconsistent with the failure of American men to know how to act like men in this anxious moment of history. The choices are pretty unappetizing: be a jobless loser in a "Pray for Death" T-shirt with neck and knuckle tattoos, or a loser in a corporate cubicle, or a loser in that Nevada drone-control bunker, or a loser in the eyes of the family court, or a loser on cable TV. Tom Ball, the man who set himself on fire in Keene, New Hampshire recommended something that sounded a lot like violent revolution, though his tone was eerily measured for someone about to commit the most desperate personally public act. I hope we don't have to go through a convulsion in this land to find out how what it means to be a man.

Sunday, June 19, 2011

I'm sure by now that everyone has heard about the "Kissing Couple" during the riots in Canada last week...if not here is the info..

Thursday, June 16, 2011

FRANKFURT, Germany (AP) -- Greece's economy is small but the shock waves from a default on its debt could be amplified by links in the global financial system to hurt stocks, banks and entire economies far from the epicenter in Athens.

In Greece, banks could go bust, overwhelming the government's ability to bail them out, and lenders in France, Germany and elsewhere in Europe could suffer serious losses.

And the resulting market turmoil could strain the European' Union's backstop fund, pushing European leaders to drum up yet more taxpayer financing, with voters already annoyed at funding other people's failed governments.
The exact effects of a Greek debt implosion are hard to anticipate, in part because no one knows how big the losses would be for bond holders, who stand first in the chain of dominoes. Forced losses of 50 percent would be one thing, a voluntary stretchout of repayment another.

Beyond the immediate hit to banks, the biggest fear is that of contagion -- a difficult-to-predict chain reaction that could roil markets and make it harder for other indebted countries to cope with their debts, with the result being higher borrowing costs for eurozone countries.

Some even say the end of that road could be one or more of the weakest euro members -- such as Greece -- leaving the shared currency, though the political will to prevent that remains strong.

Some are comparing a Greek default to the collapse of U.S. investment bank Lehman Brothers in September, 2008, which triggered the most severe phase of the world financial crisis, freezing credit markets and leading to a slump in global trade.

It's not clear a Greek default would be that sweeping, but economists say that like Lehman's collapse, its damage could be greater than expected.

"The risk of a 'Lehman moment' for the eurozone is increasing," says Neil MacKinnon, analyst at VTB Capital. "The nature of the eurozone debt and banking crisis is similar to previous financial crises in modern times because of the inter-connectedness between the banking sectors and government debt."

Financial trouble can hit the wider economy if banks suffer losses that make them afraid or unable to lend to businesses. The IMF has identified bank trouble as the biggest risk to Europe's recovery.

"It's difficult to separate out the financial risks from the macroeconomic risks," said Jonathan Loynes, chief European economist at Capital Economics. "The two are clearly very closely related."

"If there are major systemic financial repercussions, from some sort of Greek default then I think it would pretty clear that they would have major macroeconomic effect. We saw that after the Lehman episode... Disruption in financial markets is very readily translated to macroeconomic weakness through a number of channels."

Markets would then wonder whether bailed-out Ireland and Portugal would also default, making it harder for them to return to borrowing markets.

For now, most observers and market participants expect some kind of new aid deal to tide Greece over short-term -- but fears that the EU might fail at that task is sending stock markets and the euro lower, after Greece's government called a confidence vote over its struggle to impose more spending cuts on its unhappy constituents. That follows eurozone finance officials' inability to agree on conditions for a new aid package.
French and German banks hold 55 percent of Europe's total exposure to Greece, with $56.7 billion and $33.9 billion. That includes money owed by government and banks, plus exposure to credit guarantees. 

Ratings agencies have indicated that banks could probably get through losses of 50 percent or more on their holdings, based on their profitability, though shareholders would see their earnings dinged.

Greek banks, which hold roughly a third of the country's debt, could see their capital wiped out and need bailouts.

For just this reason, the European Central Bank has warned against letting Greece force bondholders to take less than full payment: any money the Athens government saved would just have to be used to recapitalize the Greek banks.

With the government already bankrupt, the money would likely have to come from somewhere else -- such as fellow eurozone governments who have already kicked in for bailouts and are now facing a sour mood among their voters for having done so. Mario Draghi, head of Italy's central bank and the likely next head of the European Central Bank, warned the European parliament Tuesday that anyone advocating a restructuring needed to be ready with new money.

"The cost of a real default will exceed the benefits and will not address the root causes. Moreover we do not know what contagion effects it will have", said Mr Draghi.

Nout Wellink, another member of the ECB's rate-setting council, said European governments need to be ready to double the size of their bailout fund to euro1.5 billion -- a prospect that cannot please German Chancellor Angela Merkel, who faces unrest in her government's ranks over Germany's role as the leading funder of bailouts.

Economist Loynes said even a relatively orderly default would not end the crisis. That's because Greece's economy still has business costs that make it uncompetitive in international trade.

"I don't think it stops with a default, either. I think this is all leading down a road which ends with Greece and perhaps some of the other countries deciding to leave the single currency."

Tuesday, June 14, 2011

from a walk thru town...alleyway...

Monday, June 13, 2011

A Distant Sound of Churning

    In my last dream of a febrile night, I put my flat-screen TV on top of an old house in town and watched it crash onto the street. There was nothing inside it. The darn thing was empty. The ghost of Little Caylee wasn't even in there.
     From the news this weekend, you'd think the world was in a coma, but I swear I heard ominous bassoon phrases through the night rain... something large groaning out there in the dark. A great churn, coming closer. The world is in a box, tortured with its obsolete ideas about how economies are supposed to run, especially the money part, and the economists are clueless.
     A case in point: the eminent Vincent Reinhart at the Council of Foreign Relations last week. (Conspiracy theorists just shut your pie-holes):

 "There are very few debt defaults... there are a whole lot of restructurings. For most of history, default is something the strong declare on the weak when they lose their patience. And if you're members of the same club, you're less likely to lose your patience. Hence you're less likely to default. Greece is in the club."

     The club he refers to - the Euro money club - is less a jolly fraternal lodge than a funeral insurance association. The latest restructuring for Greece he referred to is a cockamamie perpetual rollover with no redemptions allowed, while Greece has to agree to become more like its neighbor, Albania, in lifestyle - that is, like Borat, minus the joie de vivre.
     There's a third option that Reinhart ignores: the Greek populace can riot in the streets, toss out their government, install some kind of rump leadership and hoist its middle fingers at the Euro management team, opting out of the club. Why this does not occur to Reinhart (and many other vested poobahs) I can't say, despite the fact that there are many places around the world (especially Europe these days) where the natives are obviously getting restless. Besides, it's not lost on the Greek people that they're being asked to go Albanian for the sake of a dozen banks up in Germany, France, and Holland, not their own country's sacred honor. 
     The proposed restructuring is all about the Great Fear that haunts the inner sanctums of finance (like the ghost of Caylee haunts America): counter-party obligations on a Burj Dubai of side bets over things such as the soundness of bonds and the movement of interest rates. The world of money imagines a thundering crash of cascading defaults as the various counter-parties are revealed to be broke, naked, and ashamed. And rightly so, because the creakings and groanings of this tower of paper will not only crash, but burn, too. The bankers can already smell it.
     Anyway, let's be clear that money has become a world unto itself now, a self-referential hall-of-mirrors that only sees itself and is increasingly confused by what it sees in that self. Outside that blinding little box there are real economies of people trying like hell to go about their daily life, and there is much to be fretful about. Economies are caught in the permanent compressive contraction of fossil fuel based activities. When you hear a politician utter the word "growth" note that he/she is speaking out of his/her ass. Contraction is contraction, not growth. We're done with growth of that kind because our fuel supplies are shrinking, not growing. The vaunted "recovery" is a political three-card-monte trick.
      The sad fact is we don't want to go where history wants to take us: to a smaller human imprint on the planet, with all that implies. This is true especially of the intellectual avant-garde, who can't imagine a world without the joys of perpetual techno-narcissistic novelty, of levitating skyscraper cities with hanging gardens and flying cars, full of girls with green nail-polish in get-ups so fantastic mere mortals could never have dreamed them up, flaunting hand-held gadgets so miraculous that life itself seems besides the point. Oh, shimmering future! Oh Ray Kurzweil and your nano-ladder to the worm-holes of forever!
     This Ancien RĂ©gime is about to be swept away on the tsunami of its own futility.
     The failure of leadership around the world is now complete. Nobody who needs to get it gets it. Our own money management team here in the USA is in a box even worse than Europe's. It's not even a hall of mirrors. It's a broke-down Winnebago with moldy upholstery and the propane line is leaking inside. Everybody's wondering if Ben Bernanke is going to light a cigarette. What else can he do? If he doesn't keep the QE-ZIRP racket going, the wheels will come off the Winnebago. If he lights that American Spirit, she'll blow.
     The US banking system can easily implode, anyway, if a European nation or two opts out of ECB-peristroika. God knows who is a counter-party to whom in the mammoth international clusterfuck of accounting fraud that passes for a commerce in capital. Hence, everybody is nervous - except the fools at the Nascar oval with Big Gulps in their fists. When the Greeks and Spain's youth corps, and even the bleery folk of Dublin take to the central square to express their rage, and hoist middle fingers to those who would chisel them into debt serfdom, Americans will have no central squares to go to. Will we take to the highway strips and burn down a Taco Bell or two? Maybe President Obama will ask congress for a home mortgage TARP, guaranteeing that nobody will ever buy a house again, at least not on an installment loan. Maybe in tonight's New Hampshire "debate," Michele Bachman will appeal to Jesus for the release of Little Caylee from eternity's impoundment lot, and the stunt will carry her overwhelmingly to the oval office.
     By then, America, too, will be more like Albania. You can take that to the bank, if there's one left standing. Yesterday a little US flag appeared on every mailbox in the neighborhood. Someone is trying to help remind us what country this is. Most years, this is just ceremonial routine, but now I suspect a lot of people get up and scratch their heads over it. And, believe me, just waving that old flag is not going to furnish any kind of idea you can really hang onto.
      Out of the current stillness in world events, a horrible churning waits. Men in impeccable suits on Swiss terraces cannot hide their anxiety. One might even lose it and jump a hotel maid - you never know. Bernanke, Obama, Geithner are powerless against the dark lurking churn, though they can easily make it worse. What a summer we're in for. Get out of the stock market.

Saturday, June 11, 2011

Ice Cream Crank-off at Chestnut Square...
lots of folks turned out for a break in the heat and to eat some good homemade ice cream!

This morning I discovered the joys of Iphone photography, proving once again
that the best camera is the one you have with you...
Farmers Market @ Chestnut Square

Friday, June 10, 2011

More on Fukushima...truth or fiction???

Fukushima meltdown – Caldicott says Japan may become uninhabitable – media silent

Posted On Tuesday, 31 May 2011

Dr Helen Caldicott says that the Fukushima nuclear disaster has the potential to make Japan “uninhabitable”, yet the mainstream media in Australia continue to ignore the crisis. Managing editor David Donovan reports.

Yesterday – the same day Germany announced it would close all its nuclear plants because of Fukushima, and dangerous levels of radiation were reported in Japanese clean-up workers – Independent Australia did a straw poll of 50 random people at a metropolitan shopping centre in Queensland. Each of them was asked: “were you aware that there had been a nuclear meltdown at Fukushima in Japan”. Almost all of these respondents recognised the name Fukushima but only 4 of the 50 – a mere 8 per cent – said they had heard of any meltdown.

This rough poll points to deficiencies in popular media reporting in Australia of what some say has the potential to become the most devastating man-made disaster the world has ever known.

That may sound like an alarming claim, so let’s look at the facts.

In the wake of the March earthquake and tsunami, on March 15, Independent Australia reported:
“Yesterday, Japan’s nuclear agency attempted to calm fears by ranking the incident as a Category 4 nuclear accident, below the 1979 Three Mile Island partial meltdown in the US and well below the Chernobyl meltdown and explosion 25 years ago which rated top of the scale at seven.”

As also reported then, experts in Australia, including Dr Ziggy Switkowski, along with the Japanese nuclear power plant operator Tepco, tried hard then to dispel public fears about the severity of the disaster. By March 25, however, the category had been upgraded above Three Mile Island to a level 6. Then on April 13, as Tepco struggled to contain the fires burning at the reactor, it was reluctantly given the top rating of 7 by the Japanese authorities, which classed it as a “major accident”, equal to Chernobyl though officials still maintained the disaster was not as severe since there had not, apparently, been a melt-down.

Fast forward a month to May 13, and people’s suspicions and fears were realised when Tepco admitted there had, in fact, been a meltdown in Reactor One. Not only that, but reports began circulating that Tepco had been aware of the meltdown since the very earliest days of the accident.

On May 18, the Financial Times reported the following about the escalating situation:
“In the first days after the Fukushima Daiichi nuclear power station began spewing radiation in mid-March, the plant’s operator and Japanese safety regulators studiously avoided the word “meltdown”.

Yes, they said, uranium fuel rods in the tsunami-hit facility’s reactors might have been damaged after cooling systems failed. But the official view was that the rods were still mostly intact – and radioactive material was safely contained inside their zirconium sheaths.

Now, a little over two months later, new information on the state of Fukushima Daiichi’s three overheated reactors is making the m-word impossible to avoid. Fuel inside the cores, it is now understood, melted far more quickly and extensively than was initially believed – disintegrating just a few hours after the tsunami knocked out the plants electricity and cooling systems.”

And, not only had there been a meltdown in reactor 1 but, in fact, there had been meltdowns in two other reactors as well:
Tokyo Electric Power, Fukushima’s operator, says there may be little left of the rods at all – just clumps of uranium at the bottom of the reactors’ innermost steel containers. Some of the melted fuel may have leaked into the concrete vessels that form the next layer of protective containment, making for a meltdown by even the narrowest industry standards.

On Wednesday Naoto Kan, prime minister, said Tepco was working on the assumption that some fuel from Fukushima Daiichi’s No 1 reactor core had leaked out. On Monday Haruki Madarame, chairman of the Nuclear Safety Commission, said: “Our understanding is that the No 2 reactor melted down. We surmise that the No 3 reactor is in the same situation.” The darkening picture of conditions inside the cores – which has emerged since Tepco began sending workers into the reactor buildings for the first time last week – has added to doubts about whether Tepco and the government disclosed all they knew in the early days of the crisis.

The Financial Times went on to say that the Japanese Government was maintaining its line that Fukushima had only leaked 10 per cent of the radiation of Chernobyl.

This claim must now be held in grave doubt. Former nuclear industry engineer and executive Arnie Gunderson described the ground water contamination at Fukushima as “the worst in human history”. Dr Vivian Norris, writing in the Huffington Post, described his findings:
Gundersen is in touch with senior members of the Japanese nuclear establishment.…I will summarize some of Gunderson’s very disturbing and important information here:

1. There was a hydrogen explosion and it was a detonation not a deflagration, in other words the fire burned up not burned down.
2. A frame by frame analysis shows a flame which confirms that the fuel pool is burning as a result of an explosion which started as a hydrogen explosion but that could not have lifted the fuel into the air so there must have been a violent explosion at the bottom of the fuel pool. But more data is needed.
3. Gunderson speaks about past criticalities in other nuclear reactors around the world, and I fin d it odd we are not hearing about these and how they can teach us about what is going on now at Fukushima.
4. Radioactive water is being pumped out and ground water is contaminated so there must be a leak or leaks and this disaster is in no way contained. There will be contamination for a long time to come and this ground water contamination is moving inland. One town is reporting radioactive sewage sludge from ground water or rainwater.
5. The Greenpeace ship Rainbow water has requested the Japanese government to test the waters near Japan and Japan has refused this independent data request. The EPA has also shut down all inspection centers and is NOT inspecting fish. (Why the silence?)

Professor Christopher Busby from the European Committee on Radiation Risks says Fukushima’s highly radioactive gases and liquids continue to be released into the environment unabated. Prof. Busby noted that higher than normal levels of radioactivity had, along with Tokyo, been reported in the US as well in Europe and the UK. He suggested that we are likely to see at least 400,000 cases of cancer as a result of Fukushima.

“It is a global situation now,” said Prof. Busby, “and the situation continues to worsen.” 

“Of course it’s time for the Japanese government to take control. But having said that, it’s very hard to know how you could take control of the situation. The situation is essentially out of control.”


So far the plume of radioactivity from Fukushima has mainly been blowing out to sea. The concern expressed by many is about what happens if the prevailing winds turn around, as they are expected to do, and begin to blow southwards towards Tokyo.

Dr Vivian Norris, quoting Arnie Gunderson again:
What is highly disturbing is that the main reason Japan does not appear to be as bad a Chernobyl is that the wind was blowing out to sea and not for the most part towards land. But all this has done is spread the cancers out into the worldwide population as opposed to concentrating it all in Japan. It will be very difficult to tell, as it was in France, Scandinavia and other places where the Chernobyl cloud travelled in the days following the disaster.

Speaking exclusively to Independent Australia, prominent anti-nuclear campaigner Dr Helen Caldicott raised two grim and shocking scenarios about what foreseeably could happen next in this developing emergency.

“If there is a very big aftershock, as there very well could be, Reactor 4 will probably collapse along with other buildings. This would create a Chernobyl type catastrophe which, combined with a change in the wind – so its blowing the radiation to the South instead of out to sea as it is at the moment – could make almost all of Japan – including Tokyo –uninhabitable forever.”

“The second possible scenario is that there could be hydrogen explosion blowing one of the reactors apart also creating a Chernobyl type event. This, combined with the wind change mentioned would create the same result—an uninhabitable Japan.”

Fukushima may end up being one of the worst disaster the world has seen, we are yet to know its full impact as Japanese authorities struggle to contain the fallout. Yet, if you weren’t reading Independent Australia, listening closely to a small handful of other Australian media sources, such as Crikey, or Mark Willacy on ABC radio, or reading the international press, it is likely that you would have missed the meltdown and would have no comprehension about the full scale of the disaster. In other words, the vast majority of Australians who get their news from newspapers or commercial television or radio have no idea about the severity of the Fukushima nuclear disaster, or the danger to human health posed by this ongoing crisis.

Something similar is going on in Japan and the US. In Japan, the nuclear industry has been actively promoted by the Government since inception in the interests of Japanese nuclear security. The nuclear regulator is almost entirely made up for former Tepco employees and is described as being almost an arm of the power company. Criticism of nuclear power has long been strongly suppressed in Japan.

[Japanese journalist] Uesugi also notes that at TEPCO press conferences, which are now being held at company headquarters, foreign correspondents and Japanese freelancers regularly ask probing questions while mainstream journalists simply record and report company statements reiterating that the situation is basically under control and there is nothing to worry about. One reason for this, Uesugi suggests, is that TEPCO, a giant media sponsor, has an annual 20 billion yen advertising budget. “The media keeps defending the information from TEPCO!” “The Japanese media today is no different from the wartime propaganda media that kept repeating to the very end that ‘Japan is winning the war against America,’” Uesugi exclaimed.

Clearly, there is a concerted effort by Japanese authorities to downplay the significance of the disaster to ensure the future sustainability of the nuclear power industry. But what about the similar silence in the US?

Dr Norris says the issue should be front page news everywhere:
“Why is this not on the front page of every single newspaper in the world? Why are official agencies not measuring from many places around the world and reporting on what is going on in terms of contamination every single day since this disaster happened? Radioactivity has been being released now for almost two full months! Even small amounts when released continuously, and in fact especially continuous exposure to small amounts of radioactivity, can cause all kinds of increases in cancers.”

In the US and Japan, where the nuclear industry is a powerful lobby group, perhaps it is understandable that the nuclear industry have managed to suppress information about this devastating crisis. But here in Australia, where we have no nuclear power industry? The reality is that Australia, with its huge natural reserves of uranium and strong mining industry, is deeply entrenched in the nuclear cabal. Independent Australia has reported before about plans for the world’s nuclear waste to be shipped to Australia and the fact this agreement with the US was actively suppressed by the Australian media, perhaps because some media proprietors have strong vested interests in the nuclear industry. It seems that Australia’s overly concentrated media industry is not only a crisis for our democracy, but can potentially even threaten our children’s health.

Dr Caldicott said that the media here are failing in their duty to the people of Australia.

“The media need to be brought down to Earth,” said Dr Caldicott.

“President Jefferson said an informed democracy will make reasonable decisions.”

“The media are failing to inform, so the people can’t make reasonable decisions.”

Monday, June 06, 2011

Fitch Blows At Greek Bailout House Of Cards, Says On Closing Of Distressed Debt Exchange Will Place Sovereign Rating Into Default

As we speculated yesterday...
  • If in Fitch's opinion, an announced exchange offer constitutes a DDE, the sovereign issuer rating will be lowered to 'C', indicating that default is highly likely in the near term
  • Fitch will place the issuer rating of the sovereign into default, specifically 'Restricted Default' (RD) upon closing of a distrssed debt exchange.
  • Fitch says a potential Greek debt exchange if voluntary, could still be considered a default event
  • Fitch says Greek debt exchange would be a default if bondholders terms were worse than original terms
  • Fitch says stressed sovereign debt exchange with worse terms is a technical default even if deemed voluntary
The gist is clear: the great unknown of how the rating agencies will treat even a "voluntary" restructuring is still in the closet.

Fitch Ratings-London-06 June 2011: Given considerable market speculation regarding a possible debt exchange involving Greek ('B+' / Rating Watch Negative) sovereign debt, and subsequent interest in the rating approach adopted by Fitch Ratings in determining whether a debt exchange is an event of default and the rating implications before and after an exchange, the agency has outlined below its approach to sovereign debt exchanges based on its general 'Coercive Debt Exchange Criteria.'

There are two guiding principles in determining whether a debt exchange constitutes a default event or is an opportunistic 'liability management' exercise that has no rating implications. The first is an assessment of the terms on the new securities offered in the exchange and whether they are materially less advantageous to bondholders than the existing securities. The second guiding principle is whether the exchange is, or appears to be, necessary to avoid insolvency and/or illiquidity. Thus a debt exchange that offers new securities with terms that are worse than the original contractual terms of the existing debt and where the sovereign is subject to financial distress (which can be reflected in low issuer ratings, or ratings which have seen a sharp downward migration, or both) would be judged by Fitch to constitute a 'coercive' or more commonly known as a 'distressed debt exchange' (DDE) and hence a default event, even if bondholders' participation was deemed to be 'voluntary.'

A more complex situation would arise if the terms on the new securities, taken in the whole, were considered to be broadly neutral or better than the terms on the existing securities. For example, the offered securities may incorporate significant credit enhancements in the form of collateral and other features such as higher and/or step-up coupon profile. Determining whether the terms on the new securities imply an economic loss or gain relative to the terms of the existing securities can be complex and subjective, with a net present value analysis providing only a guide. Participation in the exchange would also have to be 'voluntary' in the sense that bondholders are not subject to 'sanction' if they choose not to participate. An important guide in this respect is that securities not tendered are not at greater risk of non-payment nor are they implicitly or explicitly subordinated to the securities created by the exchange.

If in Fitch's opinion, an announced exchange offer constitutes a DDE, the sovereign issuer rating will be lowered to 'C', indicating that default is highly likely in the near term. The ratings of the securities subject to the exchange will also be lowered to 'C'. On closing of the exchange offer and following confirmation that the exchange will be completed (for example because the minimum threshold for participation has been met), Fitch will place the issuer rating of the sovereign into default, specifically 'Restricted Default' (RD). The ratings of the tendered securities will be lowered to 'D' and will remain at that level for as long as the sovereign is rated 'RD'. The ratings of eligible securities that are not tendered and continue to be serviced will remain at 'C' until the exchange is completed with the issue of new securities.

Fitch will conduct a review of the credit profile of the sovereign in light of its anticipated post-exchange capital structure along with other relevant information after the offer date has closed and prior to completion marked by the issue of new securities. Based on such a review, Fitch may issue expected ratings on the new securities that would be confirmed on completion of the exchange (or very shortly thereafter) and receipt and review of the relevant documentation. On completion of the exchange, Fitch will also assign new issuer ratings to the sovereign and simultaneously withdraw the ratings of the securities extinguished by the exchange. The ratings of the securities not tendered in the exchange could be raised from 'C' to the level of the rating of the new securities if those ratings are higher and they are not in any way subordinated to the new securities. However, if securities not tendered into the exchange subsequently become non-performing, the sovereign (issuer) ratings will remain in default. 

The Creeping Nausea of American Exceptionalism

       History, that coy dominatrix, loves to trick the credulous human race. In a moment when something we call "democracy" seems to be spreading through the dodgy precincts of the world like a contagion of virtue, the trend is actually going the other way in countries that have practiced it for a while.
     That is certainly the case in Europe, especially Greece right now, where the mobs in Syntagma Square denounce their waffling parliament for agreeing to a bailout deal that will make Greece a step-child of Germany. The German voters are none too pleased with this, either, since their country is now on the hook to pay Greece's bills. Ireland, Portugal, and Belgium are standing by for adoption next in Europe's Home for Wayward Children. Spain and Italy may need to become wards of the Euro-state, too, but they are more like adults with drinking problems who are liable to wreck the whole household if invited in.
     Anyway, the Greeks rallying in Athens' central square lately are sick of politicians and parliaments, and there is a no small danger that they will soon rise up and dispense with theirs in the dumpster behind the Parthenon. A man in a uniform has a certain appeal in a situation like this. He is comfortable issuing orders in unfavorable situations, in fact, rather thrives on it. The Germans know all about this. Their "savior" back in the 20th century was a fellow in an ersatz military getup who virtually ran for office by denouncing "parliamentarism" and by the time his party occupied a fair portion of the seats in theirs, he burned the darn thing to the ground.
     The Irish gaze longingly at little Iceland, out there in the North Atlantic now free of debt obligations from the simple act of raising the middle finger in the direction of the London banks. Ireland is sore tempted to do likewise, and the act would have an appealing historical symmetry to it. They may toss out their parliament to get to it. Staying sober is another matter. In Portugal, they are too busy having lunch, which is a very serious affair, they will assure you, and undertaken in spirit of absolute Iberian fatalism (that beefsteak died for you!). Oh, for the days of Salazar when lunch was decreed eighteen hours a day! Belgium, of course, will always be hopeless - Europe's doormat. And what can you say about a people who slather mayonnaise on their French fries - apart from their amazing failure to discover the miracle of ketchup, despite being overrun by American GIs sixty-odd years ago - and speaking a language that nobody has ever written rock and roll song in.
     Europe is held together with baling twine, masking tape, and spit. It's been a fun half-century catering to harmless clownish tourists from Houston, with their "big boss" belt buckles and decoupaged wives. But lately the Chinese visitors look more like bargain-hunters at the preview of an estate auction, sizing up the merchandise, and even the waiters in the cafes know the score. The Grand Palace of Euroland is closing for business. Anybody who thinks that Germany is going to run some kind of halfway house for crackhead countries "in recovery" will be disappointed. The compressive contraction that grips the OECD like economic Lou Gehrig disease will be with us as far ahead as anyone can see. 
     For sure, there are features of European life that dispose many of its countries to face the long emergency on much better terms than the train wreck across the Atlantic. They know how to get by on much less oil - though the coming energy crisis will still be hard on them. They have excellent public transit already in place (yes, it depends on the energy situation). Their agriculture is scaled much more intelligently. Their cities, too, with some exceptions. But they have a long history of brawling amongst themselves and the recent half-century of peace and prosperity is already taking on the shimmer of a fading mirage. Europe is burning down financially from the outside in while the monster that was known as the global economy lies gasping on the rocky shore of Fukushima. The Euro and the weak political union that went with it, is toast. You can include the outsider England in all that, since their practical circumstances are no better than Spain's or Italy's - perhaps a little worse, even... poor tattered Old Blighty!
     By the way, I hope you don't think the homefolks here in the USA are all that deliriously happy with representative government either. These days, despite all Sarah Palin's bluster about "freedom" and "our heritage," elected officials are held in about equal esteem to herpes viruses. Congress and the senate are paralyzed by triviality and the President is too busy golfing to disturb the status quo - which is the status quo of a house on fire. We won't have to wait much longer to find out how unexceptional America actually is.
     It's a darn shame, and I mean that literally, because this is exactly what the American public is so ashamed of, and why appeals to the repressed sense of shame based on hyper-patriotic bluster, are so successful. It allows folks to feel great about themselves while they sink into the ooze. It's okay, we're special. I stopped at a convenience store at the edge of the Adirondack Mountains on Saturday afternoon and a more frightening gaggle of disfigured mutts I have never seen before. Has everybody in upstate New York only just been released from prison? The tattoo craze is especially telling. It's one thing to get some tattoos with the idea that you are artfully expressing something. It's another thing to deploy them around your body parts as though you were slapping decals on a 1989 beater car. These mutts had tattoos on their necks, their boobs, the sides of their heads, their knuckles, their ankles. The idea, apparently, is to make yourself appear as frightening as possible - and I can tell you it is a very successful initiative. Can lady Gaga please write us a new national anthem: America the horror movie.

Thursday, June 02, 2011

Moody's warns US gov't on possible debt downgrade

First Washington...hmmmm.....

WASHINGTON (AP) -- A credit rating agency is warning the U.S. government that it could lose its sterling debt rating if Congress and the Obama administration don't reach an agreement to raise the nation's borrowing limit.
Moody's Investors Service said Thursday that if the parties fail to make progress soon, it would put the U.S. rating under review for a possible downgrade. That's because there's a "very small but rising risk" that the government will default on its debts.

Standard & Poor's, another major credit rating agency, issued a similar warning in April.

The U.S. government hit its $14.3 trillion borrowing limit on May 16. The debt limit is the amount the government can borrow to help finance its operations.
A lower credit rating could ripple through the U.S. economy and ultimately hurt consumers. That's because many loans, including mortgages, tend to follow yields on U.S. Treasury bonds. So interest rates could rise.

Moody's also warned the government could face a downgrade if it fails to come up with a long-term plan to reduce the country's deficit. The federal budget deficit is on pace to exceed $1 trillion for the third straight year.

Moody's said it had expected strong political debate over the topic. But the entrenchment of both sides is greater than it anticipated.

President Barack Obama and Republicans both have said the country needs to reduce its annual deficits. But they are at odds over how to do it. Republicans insist cutting spending without tax increases. Democrats say any plan should include both.

Obama met privately with both parties this week to discuss the issue but no progress has been made.

Time is growing short. The Treasury Department has said the U.S. government is at risk of a default if it does not raise the borrowing limit by Aug. 2.
"The heightened polarization over the debt limit has increased the odds of a short-lived default" by the government, the rating agency said. "If this situation remains unchanged in coming weeks, Moody's will place the rating under review."

In April, Standard & Poor's for the first time lowered its long-term outlook for the government's fiscal health from "stable" to "negative." And it warned that it could strip the government of its top credit rating over the next two years if lawmakers failed to reach a deal to control the massive federal deficit.

Wednesday, June 01, 2011

What the Hell?

The biggest self publicists in American politics, Donald Trump and Sarah Palin, supreme commander of MILFistan', chose the perfect dining spot as they sat down for dinner last night.

Instead of picking a quiet and secluded restaurant, the shameless pair stopped by at a pizzeria in the centre of New York's Times Square.

The duo shared a large pepperoni pizza as surprised tourists lined up at the restaurant's windows to take photos.

Watch the media frenzy over this spark some debate!

Hurricane Season begins today with Invest 93L just east of Florida

Maybe, just maybe, it will bring some rain to drought stricken areas of Texas...