I had no idea what on earth to write about last week...There was too much to write about!! Instead I made a draft of my views last week which I did not finish.
So the world has turned into the rule of the bond market. If you want to know what happens, look at the rating agencies a few purpose done government leaks and the market speculation.
one day this week at 13.30 the rallying of stocks occurred on the DAX bringing it up by 3% percent within minutes. Though still peripheral pressure was implemented on Europe.
The worrying thing was that the Chinese Central Bank cut deposit rates for banks as the China markets closed negative, possibly showing a new landmine that could go off on the already fuel leaking world market.
Still I think one kind of cranky positive result that has come out this week so far is that the UK economy doesn't seem to be needing to fear the rating agencies for the time being only the Strike currently occurring which is seeing huge amounts of public Sector workers affect the growth of the UK economy.
Wednesday 7 December 2011
Monday 21 November 2011
Middle East, Democracy and Civil Unrest
If you had to think of a chess match of strategic economics, this would be it.
In chess you have to be as many steps ahead of the opponent as possible, so that the main outcome is to bait your challenger into thinking that he can see your next move. The same can be said in the real world and this could be the playing game with the middle east.
Democracy is one of the stages in the building-blocs to becoming a more advanced country, but the trick is to know when that should be done, otherwise your country could stall or even worse be at the mercy of strategic interplay whether it be economics or geo-politics.
What better way to give an excuse to allow for more foreign intervention than to allow the people in the country, to remove the autocratic government and then have the temporary elected government become corrupt. This is the case in Egypt, this week the military government took action against protesting on the main Cairo square. This resulted in deaths, showing the new Egypt as unstable, allowing for more international pressure to be put on the OPEC state.
Libya at the moment is in a good position, the current governing body seems to have a good strategy to the recovery of the country and implementing democracy in the short medium-term. Also there is an equal amount of cooperation happening in Libya between the government and public, as they give ease and criticism to the transition. Libya was also one of the most developed African countries, thus for the democracy transition, it was inevitably going to be easier. Nonetheless they still had a civil war occur and bombing with NATO (though I think this was in tern for economic aid transaction for the future).
Syria remains highly unstable and also could show a more dangerous side of strategic economics... Allow the country to internally remove itself, where the remaining controller still has a wielding power. This is cost effectiveness for any country which sees a strategic advantage whether be in implementing a new government strategy or for fundamental resources such as geographic dominance or natural resources for the example. Also external countries have less a reason to enter Syria as it's resource return is low and the public are not that cooperative.
I will continue more tomorrow on this topic, though I just spotted an announcement on 'Moody's' rating agency, which has the French AAA credit rating under view. This is just primarily down to market speculation, as we all know whether it be fundamental behavioural theory or strategic economics, the market is always proactive, though never as rational as a monkey.
Tata
In chess you have to be as many steps ahead of the opponent as possible, so that the main outcome is to bait your challenger into thinking that he can see your next move. The same can be said in the real world and this could be the playing game with the middle east.
Democracy is one of the stages in the building-blocs to becoming a more advanced country, but the trick is to know when that should be done, otherwise your country could stall or even worse be at the mercy of strategic interplay whether it be economics or geo-politics.
What better way to give an excuse to allow for more foreign intervention than to allow the people in the country, to remove the autocratic government and then have the temporary elected government become corrupt. This is the case in Egypt, this week the military government took action against protesting on the main Cairo square. This resulted in deaths, showing the new Egypt as unstable, allowing for more international pressure to be put on the OPEC state.
Libya at the moment is in a good position, the current governing body seems to have a good strategy to the recovery of the country and implementing democracy in the short medium-term. Also there is an equal amount of cooperation happening in Libya between the government and public, as they give ease and criticism to the transition. Libya was also one of the most developed African countries, thus for the democracy transition, it was inevitably going to be easier. Nonetheless they still had a civil war occur and bombing with NATO (though I think this was in tern for economic aid transaction for the future).
Syria remains highly unstable and also could show a more dangerous side of strategic economics... Allow the country to internally remove itself, where the remaining controller still has a wielding power. This is cost effectiveness for any country which sees a strategic advantage whether be in implementing a new government strategy or for fundamental resources such as geographic dominance or natural resources for the example. Also external countries have less a reason to enter Syria as it's resource return is low and the public are not that cooperative.
I will continue more tomorrow on this topic, though I just spotted an announcement on 'Moody's' rating agency, which has the French AAA credit rating under view. This is just primarily down to market speculation, as we all know whether it be fundamental behavioural theory or strategic economics, the market is always proactive, though never as rational as a monkey.
Tata
Friday 18 November 2011
2025...The period for nuclear & renewable energy
I'm taking a mini break from the EU as the Financial Times this week has been reporting on the nuclear debate going on around the world currently, after the Japanese earthquake produced our second largest nuclear energy industrial incident. Not only that I was also invited to attend an ecological economics speech yesterday where nuclear was condemned (as well as positive economics & monetarism which is really two my economic areas). So I thought about giving my opinion, mixed in with scientific facts.
We cannot smell it, feel it; though we breath it in, it tans our skin, it's in the food we eat; it is there and that is what radiation is, the invisible particles of life. It has been there all our lives, from the sun, the earth, from atomic testing to the medical industry, but why are we scared of it?
My main three points about why people are against anything with the elements, are nuclear waste and nuclear destruction, be it weapons or meltdown. Though I feel a lot of the science is left unspoken, and facts can be larger than words, so here I go at trying to balance out the atomic debate with some economics as well.
The Science
Background radiation is everywhere and the biggest contributor is Radon, which comes from decaying elements in rocks within the earth's crust. Radon is approx 50% of background radiation and gamma and beta from the same decaying in the ground is 14%. 12 % is internal, what this means is we are technically radioactive as we have carbon -14 inside us, not only that, but what we eat has C-14, radioactive potassium as well as other radioactive elements inside. The next is the Cosmic, that's 10% contributed by space.
So...we have approximately 86% of radiation today being non-man made.
Man Made Radiation
The biggest man-made contributor of radiation is the medical industry...12%.
Air travel contributes 0.4%, fallout 0.4% occupational 0.2% and nuclear waste <0.1 %. This is all by the way up to present day factual numbers, from the UN, NAEA.
The Dangers
I really hate going into this topic as it is very sensitive for me on both sides valuing any loss in life is worrying area for me, but sometimes it has to be shown.
There have been many more and troubling disasters outside nuclear energy, the nuclear medical industry and other areas are much more worrying, here are examples:
http://en.wikipedia.org/wiki/List_of_civilian_radiation_accidents
My point here is that medical contributes more to background radiation, though we don't scrutinise x-rays, cat scans or cancer treatment?
And the horrible summary is that I have seen what oil has done to some poorest areas of the planet pollution wise in real life. We don't want to see it, smell it, touch it though we are addicted, that is what oil is for modern society and how many people have died due to it?
The Economics
My main concern is Germany's promise to scrap nuclear reactors by 2020. The funny thing is, to make up for that loss in nuclear, you have to build more coal fire power stations, which actually give out more radiation than a nuclear power station as well as carbon dioxide which then in turn goes in global warming. They are creating more wind farms and other renewable sources, but the energy production of wind turbine is so small, compared to energy demanded, it is an unrealistic approach and is very expensive contributor to the rise also in energy companies increasing their bills, as well as the price of oil being more susceptible to shocks and increasing due to demand and supply.
People right now and in future years cannot afford this until technology in the renewable sector improves and governments can afford to run deficits.
Conclusion
My goal is not to say we should be Nuclear forever, but when you have depleting highly demanded natural resources. A society which is going through depleted income, that will eventually have to pay more continuously for energy. A time where new nations demand more energy, and geopolitics becomes more powerful... To look away from Nuclear is really a scary mistake I feel.
Renewable energy is the future beyond a doubt, within 5-10 years we most likely will have fusion near perfected for power generation testing, and wind energy being actually cheap in a competitive market. That is where the future lies, but to jump on the green band wagon completely does not make sense from an environmental and economic point of view.
We cannot smell it, feel it; though we breath it in, it tans our skin, it's in the food we eat; it is there and that is what radiation is, the invisible particles of life. It has been there all our lives, from the sun, the earth, from atomic testing to the medical industry, but why are we scared of it?
My main three points about why people are against anything with the elements, are nuclear waste and nuclear destruction, be it weapons or meltdown. Though I feel a lot of the science is left unspoken, and facts can be larger than words, so here I go at trying to balance out the atomic debate with some economics as well.
The Science
Background radiation is everywhere and the biggest contributor is Radon, which comes from decaying elements in rocks within the earth's crust. Radon is approx 50% of background radiation and gamma and beta from the same decaying in the ground is 14%. 12 % is internal, what this means is we are technically radioactive as we have carbon -14 inside us, not only that, but what we eat has C-14, radioactive potassium as well as other radioactive elements inside. The next is the Cosmic, that's 10% contributed by space.
So...we have approximately 86% of radiation today being non-man made.
Man Made Radiation
The biggest man-made contributor of radiation is the medical industry...12%.
The Dangers
I really hate going into this topic as it is very sensitive for me on both sides valuing any loss in life is worrying area for me, but sometimes it has to be shown.
There have been many more and troubling disasters outside nuclear energy, the nuclear medical industry and other areas are much more worrying, here are examples:
http://en.wikipedia.org/wiki/List_of_civilian_radiation_accidents
My point here is that medical contributes more to background radiation, though we don't scrutinise x-rays, cat scans or cancer treatment?
And the horrible summary is that I have seen what oil has done to some poorest areas of the planet pollution wise in real life. We don't want to see it, smell it, touch it though we are addicted, that is what oil is for modern society and how many people have died due to it?
The Economics
My main concern is Germany's promise to scrap nuclear reactors by 2020. The funny thing is, to make up for that loss in nuclear, you have to build more coal fire power stations, which actually give out more radiation than a nuclear power station as well as carbon dioxide which then in turn goes in global warming. They are creating more wind farms and other renewable sources, but the energy production of wind turbine is so small, compared to energy demanded, it is an unrealistic approach and is very expensive contributor to the rise also in energy companies increasing their bills, as well as the price of oil being more susceptible to shocks and increasing due to demand and supply.
People right now and in future years cannot afford this until technology in the renewable sector improves and governments can afford to run deficits.
Conclusion
My goal is not to say we should be Nuclear forever, but when you have depleting highly demanded natural resources. A society which is going through depleted income, that will eventually have to pay more continuously for energy. A time where new nations demand more energy, and geopolitics becomes more powerful... To look away from Nuclear is really a scary mistake I feel.
Renewable energy is the future beyond a doubt, within 5-10 years we most likely will have fusion near perfected for power generation testing, and wind energy being actually cheap in a competitive market. That is where the future lies, but to jump on the green band wagon completely does not make sense from an environmental and economic point of view.
Monday 14 November 2011
Autonomy...Shift to Fiscal Union and then expansion of EFTA
Apologies on not responding on the weekend as promised, though I wanted to see what the situation regarding Italy was going to turn out by mid-week. So I hope you'll agree with me that it was indeed on good decision to make, whether that be regarding sheer laziness on my part or not knowing what interesting drama to compose on here.
Italy recieved it's first batch of Technocrats on Monday with little enthusiasm given for Mario Monti, though there was a lot of cheering & celebration for the departure of the late Mr B at what power there country has, as the IMF & ECB hammer a few more nails into the default coffin.
The use of this new technocratic power may see the newest change occurring the Europe; Fiscal control. This is maybe the one thing we can thank Greece and Italy speeding up for us. With trying to implement a whole rounded Monetary policy for the € member states, while different Fiscal control occurs really can eliminate the use of it all together. The evolution of the European Union since it's beginning has seen more conformity and policy decision making unity within most of it's key members, so to make it not happen would be a real slump.
I'm not a pro € person, though to bring confidence back to the European area and secure the long term future of the € this has to happen. The break up of the euro could still occur, though it would just be threats being eliminated that may cause future problems such as Greece and Italy(though would highly doubt Italy with the sovereign debt exposure other European banks have for it).
The problem that the euro-zone faced from the beginning was the unsynchronised fiscal policies. The main outcome for the eurozone is that fiscal harmony will occur and that the remaining EU countries will most likely merge into a separate trade agreement. There already exists this and it's name is EFTA (including Lichtenstein, Switzerland, Norway, Iceland). The merge may not be taken too kindly, though with proactive market actions being the the touch of death, you have to afford to lose some power.
I will be adding to this post this week, have to run to lectures!
Italy recieved it's first batch of Technocrats on Monday with little enthusiasm given for Mario Monti, though there was a lot of cheering & celebration for the departure of the late Mr B at what power there country has, as the IMF & ECB hammer a few more nails into the default coffin.
The use of this new technocratic power may see the newest change occurring the Europe; Fiscal control. This is maybe the one thing we can thank Greece and Italy speeding up for us. With trying to implement a whole rounded Monetary policy for the € member states, while different Fiscal control occurs really can eliminate the use of it all together. The evolution of the European Union since it's beginning has seen more conformity and policy decision making unity within most of it's key members, so to make it not happen would be a real slump.
I'm not a pro € person, though to bring confidence back to the European area and secure the long term future of the € this has to happen. The break up of the euro could still occur, though it would just be threats being eliminated that may cause future problems such as Greece and Italy(though would highly doubt Italy with the sovereign debt exposure other European banks have for it).
The problem that the euro-zone faced from the beginning was the unsynchronised fiscal policies. The main outcome for the eurozone is that fiscal harmony will occur and that the remaining EU countries will most likely merge into a separate trade agreement. There already exists this and it's name is EFTA (including Lichtenstein, Switzerland, Norway, Iceland). The merge may not be taken too kindly, though with proactive market actions being the the touch of death, you have to afford to lose some power.
I will be adding to this post this week, have to run to lectures!
Thursday 3 November 2011
When the IMF reaffirms in your mind, why it is the Last Resort...
This week really marked a major time within the History of the European Monetary Union, the first stages of Greece having no more power in it's own country.
After the markets being stressed over the future of the €zone and Italy, it seemed a deal had been sealed on the weekend and the markets were looking hopeful for Monday, that was until the Greek PM flew back to Athens and announced there would be a referendum vote given to the Greek people to ask if they still wanted to be part of the euro and EU. Obviously the markets went to the panic button and Italian bond yields rose to the roof (The higher the bond yield, the higher the cost for Italy to borrow).
The last time I read of such a immediate of loss of power, was in the Oil Crisis peak of the 70s when the UK had to borrow from The International Monetary Fund. The IMF is the lender of last resort by any country's eyes, and when a combined package with the ECB was made in the last weekend of October, Greece seemed to think it had time to hold a referendum. The heads of the IMF, Germany & France just turned round and refused to give Greece any extra money this week until Greece did the right thing. Now Greece will not be trusted for a very long time...
There is without a doubt in my mind that the Greek PM did the wrong thing, he could have nearly produced the default on Tuesday. It was that serious and also he wasted a huge amount of money within the market. Not only that but when you take into consideration that Greek bond holders lost >50% of their value on their assets negotiated between the ECB & main holders, you can see why Angela Merkel, Nicholas Sarkozy & Christine Lagarde may want to hire an assassination Squad to take down George Papandreou.
Today FT.com produced an interactive map of the possibilities of the Fallout of the EU if Greece were to default, it's interesting whichever way you take it.
http://www.ft.com/cms/s/0/0a35504a-0615-11e1-a079-00144feabdc0.html#axzz1cXJyG6ms
I don't want to be 'I told you so'...but the default is only becoming more likely, November 2011 will be something European Economic history. The EU will be quite likely, kicking Greece into the dessert by the end of the month to sacrifice the few for the many. Then stage two gets under way... Italy
I'll promise I'll lighten the mood with one of my silly graphs on the weekend^^ Maybe zombies could trigger the collapse of the Eurozone? Stay tuned!
After the markets being stressed over the future of the €zone and Italy, it seemed a deal had been sealed on the weekend and the markets were looking hopeful for Monday, that was until the Greek PM flew back to Athens and announced there would be a referendum vote given to the Greek people to ask if they still wanted to be part of the euro and EU. Obviously the markets went to the panic button and Italian bond yields rose to the roof (The higher the bond yield, the higher the cost for Italy to borrow).
The last time I read of such a immediate of loss of power, was in the Oil Crisis peak of the 70s when the UK had to borrow from The International Monetary Fund. The IMF is the lender of last resort by any country's eyes, and when a combined package with the ECB was made in the last weekend of October, Greece seemed to think it had time to hold a referendum. The heads of the IMF, Germany & France just turned round and refused to give Greece any extra money this week until Greece did the right thing. Now Greece will not be trusted for a very long time...
There is without a doubt in my mind that the Greek PM did the wrong thing, he could have nearly produced the default on Tuesday. It was that serious and also he wasted a huge amount of money within the market. Not only that but when you take into consideration that Greek bond holders lost >50% of their value on their assets negotiated between the ECB & main holders, you can see why Angela Merkel, Nicholas Sarkozy & Christine Lagarde may want to hire an assassination Squad to take down George Papandreou.
Today FT.com produced an interactive map of the possibilities of the Fallout of the EU if Greece were to default, it's interesting whichever way you take it.
http://www.ft.com/cms/s/0/0a35504a-0615-11e1-a079-00144feabdc0.html#axzz1cXJyG6ms
I don't want to be 'I told you so'...but the default is only becoming more likely, November 2011 will be something European Economic history. The EU will be quite likely, kicking Greece into the dessert by the end of the month to sacrifice the few for the many. Then stage two gets under way... Italy
I'll promise I'll lighten the mood with one of my silly graphs on the weekend^^ Maybe zombies could trigger the collapse of the Eurozone? Stay tuned!
Wednesday 12 October 2011
Greece's Future Epitaph and ECB loses a few Nukes along the way...
So time to get to the major future of the exotic € member states and really what is the future for Greece and also now Italy, which I will discuss in the next post.
In contrast to Italy and Spain (and arguably the remaining lesser deceased EMU members) Greece is insolvent and in need of debt restructuring, so now it is from a typical investors eye like this.
Greece is on life-support and we are getting ready to find out what he has in the 'family will' and who gets what debts that he goes to grave without paying.
The main problem is who Greece borrowed money off, which has left a lot of our own banks now having to realise they won't really see their money again, making the lunch group investors not know why they shouldn't move more to the BRIC countries(Brazil, Russia, India & China).
The fire-power of the European Central Bank is also under attack, the uncompromising dedication for the ECB to support illiquidity issues of governments is crucial in some ways, though it is getting more in-tuned with political decisions and this by any economist outlook gets us extremely scared.
This is due to the ECB being the grim reaper; who lives and who dies is up to them and unfortunately that is the way it goes in positive economics, though it is being slowed down now. If the ECB had its way it would have back in late July refused help to Greece and provided them with a little get out of town cash and help with defaulting, because the longer it is left the harder the fence becomes to stop greece's plague attacking Italy and Spain.
What we discussed this morning in my Behavioural lecture was also the civil situation, a lot of us showed how Greece would likely come to civil unrest, from negative growth and high unemployment with zero money, what would you do if you were Greek?
This link gives an interactive outlook on the € members on their unemployment and GDP readings as well as their competitiveness.
I think the biggest scare is that people will have to see it like this in the eyes of most analysts as the most likely options.
1.Germany leads a € break up- possible? but unlikely right now
2.Disorderly € breakup of the bottom pile?survival of € will occur though will cause large political disruption.
3.ECB takes a hit and one country exists without contagion- meh we doubt it yet we need to still think it
4.IMF decides that Default and debt restructure will occur- As likely as a bomb falling to the ground
5.Growth and inflation stabilisation occur and everything is mulled wine & butterflies-That is as likely as my monetary integration teacher deciding she is wearing latex to the lecture this afternoon. Desirable, yet highly improbable.
Thursday 6 October 2011
The Upside of Econ-Goth Blogging
For lesser part of a reason I have began to learn the new interesting side of Behaviour & Experimental economics.
Why does this entitle me to a blog spot one might ask?
Well I'm using my most lousy excuse as being a Goth.With the worldwide outlook continuing to resemble the mind of a paranoid priest from the rural area of Ireland coming into contact with Glee, there isn't much bleaker to be seen than that through the eyes of the typical dark mind of a Goth. Therefore we can take a much better macro overview than the average stressed out economist etc. as gloom is our natural area for optimism so we do not exaggerate the extent to the end of days.
So what qualifies me to waste yours and definitely my invaluable time?
Well I couldn't give a rats arse what you think as us economic students are based on mostly assumption. I'm assuming your time is less valuable, thus you chose to waste your diminishing supply on me. Ergo until your interest diminishes, I assume you will continue reading.
So you just learnt the Law of Diminishing Marginal Utility.
What I will talk about?
Well even I don't know, as any narcissistic person will tell you, I do like hearing my own opinion on things and I do have a agar eye for new material on the subject so I believe it will be about:
1.Current and future areas
2.New "exciting" material!
Why does this entitle me to a blog spot one might ask?
Well I'm using my most lousy excuse as being a Goth.With the worldwide outlook continuing to resemble the mind of a paranoid priest from the rural area of Ireland coming into contact with Glee, there isn't much bleaker to be seen than that through the eyes of the typical dark mind of a Goth. Therefore we can take a much better macro overview than the average stressed out economist etc. as gloom is our natural area for optimism so we do not exaggerate the extent to the end of days.
So what qualifies me to waste yours and definitely my invaluable time?
Well I couldn't give a rats arse what you think as us economic students are based on mostly assumption. I'm assuming your time is less valuable, thus you chose to waste your diminishing supply on me. Ergo until your interest diminishes, I assume you will continue reading.
So you just learnt the Law of Diminishing Marginal Utility.
What I will talk about?
Well even I don't know, as any narcissistic person will tell you, I do like hearing my own opinion on things and I do have a agar eye for new material on the subject so I believe it will be about:
1.Current and future areas
2.New "exciting" material!
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