Wednesday, June 26, 2019

Consumers Are Becoming Wise to Your Nudge

We've been offering solutions to this problem for a few years now. Here's "Companies Are Betting on Lab-Grown Meat, but None Know How to Get You to Eat It":
The dream of any right-thinking change agent is to mandate that people use your product.
If that approach is not feasible the fallback is to tax the competition

Here at Totalitarian Marketing Group we supply strategies for the power-mad while making life easier for the top 0.0000001%.
TMG, when nudge just isn't fast enough.
From Behavioral Scientist, June 12:
I know exactly how the conversation will go.

I’m interviewing Chris, a 52-year-old man living a small coastal town, for the second time. We’ve been exploring the new checkout process for a client’s redesigned website. The new site isn’t performing as well as the company thought it would, so I’m exploring why and seeing what we can learn from competitors. 
“Only 2 rooms left? They don’t expect me to believe that do they? You see that everywhere.”
I leave with a wry smile. The client won’t be happy, but at least the project findings are becoming clear. Companies in certain sectors use the same behavioral interventions repeatedly. Hotel booking websites are one example. Their sustained, repetitive use of scarcity (e.g., “Only two rooms left!”) and social proof (“16 other people viewed this room”) messaging is apparent even to a casual browser. 

For Chris the implication was clear: this “scarcity” was just a sales ploy, not to be taken seriously.
My colleagues and I at Trinity McQueen, an insight consultancy, wondered, was Chris’s reaction exceptional, or would the general public spot a pattern in the way that marketers are using behavioral interventions to influence their behavior? Are scarcity and social proof messages so overused in travel websites that the average person does not believe them? Do they undermine brand trust?
The broader question, one essential to both academics and practitioners, is how a world saturated with behavioral interventions might no longer resemble the one in which those interventions were first studied. Are we aiming at a moving target?
The broader question, one essential to both academics and practitioners, is how a world saturated with behavioral interventions might no longer resemble the one in which those interventions were first studied.
This was the basis for a research project we completed in February 2019 examining reactions of the British public to a range of behavioral interventions. We took a nationally representative sample of 2,102 British adults, and undertook an experimental evaluation of some of marketers’ most commonly used tactics.

We started by asking participants to consider a hypothetical scenario: using a hotel booking website to find a room to stay in the following week. We then showed a series of nine real-world scarcity and social proof claims made by an unnamed hotel booking website.

Two thirds of the British public (65 percent) interpreted examples of scarcity and social proof claims used by hotel booking websites as sales pressure. Half said they were likely to distrust the company as a result of seeing them (49 percent). Just one in six (16 percent) said they believed the claims. 
The results surprised us. We had expected there to be cynicism among a subgroup—perhaps people who booked hotels regularly, for example. The verbatim commentary from participants showed people see scarcity and social proof claims frequently online, most commonly in the travel, retail, and fashion sectors. They questioned truth of these ads, but were resigned to their use:
“It’s what I’ve seen often on hotel websites—it’s what they do to tempt you.”
“Have seen many websites do this kind of thing so don’t really feel differently when I do see it.”
In a follow up question, a third (34 percent) expressed a negative emotional reaction to these messages, choosing words like contempt and disgust from a precoded list. Crucially, this was because they ascribed bad intentions to the website. The messages were, in their view, designed to induce anxiety:....

More than likely related:

Nudge Guy Say Nudges Good, Critics Bad 
Have I mentioned I don't like the nudge people?
Ah, I see I have. More below....
Behavior: We Are More Rational Than Those who Try To 'Nudge' Us

"Google’s new media literacy program teaches kids how to spot disinformation and fake news" (GOOG)

And who better than the GOOG?

From TechCrunch, June 24:
Google announced this morning it’s expanding its two-year-old digital safety and citizenship curriculum for children, “Be Internet Awesome,” to now include media literacy — specifically, the ability to identify so-called “fake news” and other false content. The company is launching six new media literacy activities for the curriculum that will help teach kids things like how to avoid a phishing attack, what bots are, how to verify that information is credible, how to evaluate sources, how to identify disinformation online, spot fake URLs, and more.

The new media literacy classes — which frankly, some adults should read through as well — were developed in collaboration with Anne Collier, executive director of The Net Safety Collaborative, and Faith Rogow, Ph.D., co-author of The Teacher’s Guide to Media Literacy and a co-founder of the National Association for Media Literacy Education.

“We need the right tools and resources to help kids make the most of technology, and while good digital safety and citizenship resources exist for families, more can be done for media literacy,” writes educator and founder Amy Mascott, in an announcement on Google’s blog today. “I’ve worked alongside dozens of educators who believe that media literacy is essential to safety and citizenship in the digital age, but agree that it’s a topic that can be tough to cover.”

The courses offer kids not only instruction, but also a combination of activities and discussion starters aimed at helping them develop critical thinking skills when it comes to pursuing online resources.
Its overall theme, the course material explains, is to help kids understand that the content they find online isn’t necessarily true or reliable  — and it could even involve malicious efforts to steal their information or identity.

The kids learn how phishing works, why it’s a threat, and how to avoid it. They then practice their anti-phishing skills by acting out and discussing reactions to suspicious online texts, posts, friend requests, pictures, and emails.

In the bots section, they learn about how A.I. works and compare and contrast talking to a bot versus talking to a human being.

In the following media literacy sections, kids learn what a credible source is, how to figure out what a source’s motives are, and learn that “just because a person is an expert on one thing doesn’t make them an expert on everything.”

In a related classroom activity, the kids pick a question related to something they’ve seen online or are learning in class and try to get the answers online, while figuring out if the sources are credible....

Tuesday, June 25, 2019

As Lloyd's Retreats From Some Marine Insurance Lines, Rivals Step Up

Via gCaptain:

Rivals Ride Rising Rates as Lloyd’s Abandons Some Ship Insurance
Rivals to Lloyd’s of London are riding a rising tide of marine insurance rates, leaving the 330-year-old market behind after it jettisoned sections of its oldest line of business last year.

Premiums for marine insurance, which until 2018 had fallen for years due to rising competition and lower claims, are increasing after a surge in catastrophe losses in the past two years and growing geopolitical tensions.

For Lloyd’s, still reeling from two years of losses due to the heavy claims from natural disasters, it will still take 12-24 months before the segment returns to profit, Chief Executive John Neal told Reuters in New York last week.

Neal said that although the sector had performed better in the first quarter, syndicates needed to set “the right price” for the risks and consider whether all types of marine business were insurable after Lloyd’s told its 99 members to cut the worst 10% of their business last year.

Broker Gallagher said in a February report that 10 Lloyd’s syndicates have withdrawn or reduced their marine business. That has benefited the smaller London company market, which operates separately in the City.

“We are definitely seeing business from Lloyd’s coming through our door,” said a senior London company market insurer.

Marine cargo rates are up 12-14% this year, Miles Taffs, head of marine and aviation at Lloyd’s for MS Amlin, said, while sources say yacht rates have risen by at least 20%, and by triple digits in some locations....

June 14 
Insurance: Lloyd's Risks Becoming Irrelevant
May 6 
Re/insurance: "Lloyd’s promises capital flexible access to risk in new strategy"
May 1 
Insurance/Shipping: "Lloyd’s of London Plots New Course as Storm Clouds Gather" 
March 2018 
Re/insurance "Business as usual is not sustainable, says Lloyd’s Chairman"

IBD: Nasdaq Leads the Way Down

From Investor's Business Daily:
4:13 PM ET
The Nasdaq today led the market lower, as technology stocks took heavy hits after Fed officials dampened hopes for aggressive interest-rate cuts.

The Nasdaq plunged 1.4% and made a sharp drop below 8000, a milestone for the index. The composite now needs to find a floor at the 50-day moving average to avoid further deterioration. Stocks Tuesday were broadly lower.

Invesco QQQ Trust (QQQ) fell even more, closing with a 1.7% loss. The Nasdaq 100-tracking ETF saw top Nasdaq component Microsoft (MSFT) fall more than 3%. A Jefferies analyst gave pessimistic comments on Microsoft's cloud business, reports said.
Software leaders were down sharply. Shopify (SHOP) plunged more than 9% after Wedbush downgraded the stock to neutral from outperform. Shopify is nearing a test of support at the 10-week moving average. Paylocity (PCTY) was another software stock down sharply after it slid below the 50-day line. Paylocity was removed from IBD Leaderboard today.
Other major Nasdaq components such as Netflix (NFLX), Facebook (FB) and Alphabet (GOOGL) were down 2% to 3%.

The S&P 500 fell 1%  and the Dow Jones Industrial Average 0.7%. Indexes closed near session lows. Easily, it was the indexes' largest declines since the June 7 market follow-through.
Volume rose from Monday's levels, according to unconfirmed data. Losing stocks led winners by an 11-to-5 ratio on the NYSE and by nearly 12-to-7 on the Nasdaq.

Fed Comments Spook Market
Selling picked up after Fed Chairman Jerome Powell said the Federal Reserve is watching economic data and financial markets as it weighs its next move on monetary policy. But in a rebuke to President Trump's criticism of the Fed, Powell said the central bank won't act based on "short-term political interests."...

"If you had invested $10000 in gold in year 1257 AD:....

If you had invested $10000 in gold in year 1257 AD:

It would be worth 3.38 million today!
Of course as the commenters point out, getting someone to accept your greenbacks in 1257 would be difficult, much less finding fiat that wouldn't even exist for over a half-millenia.

HT Stock Cats:

"A Judge Just Ruled You Can Sue The Media Over Facebook Comments From Readers"

 Comments on a company's Facebook page?
This is an absurd decision by the judge.

From BuzzFeed:
Former youth detainee Dylan Voller is suing News Corp, Fairfax Media and Sky News. 
Dylan Voller, the Aboriginal man who was shown restrained and wearing a spit hood at age 17 in shocking CCTV footage from an adult prison, has been given the green light to sue media companies over Facebook comments written by their readers.

The landmark decision has been described as a "significant win" for the former youth detainee, and will be met with alarm by media companies wary of being hit with lawsuits over what their readers are writing on social media.

Voller, now 22, spent his teenage years in and out of juvenile detention, and rose to prominence when CCTV footage of his treatment behind bars was aired on the Australian Broadcasting Corporation’s investigative current affairs program Four Corners in July 2016.
He is suing News Corp, Fairfax Media (now Nine), and the owner of Sky News Australia for defamation over comments on Facebook posts sharing various news stories.

The stories related to various aspects of Voller's life, including the royal commission into children in detention in the Northern Territory, his time in custody and his poetry.
Voller claims a number of comments on the post defamed him by falsely suggesting, among other things, that he "savagely bashed" a Salvation Army officer, causing him serious injury, and that he is a rapist.
These comments were written by readers.

Before Voller's case went to trial, Justice Stephen Rothman considered whether the media companies could be considered liable for the reader comments.

The three companies argued they were not liable during a three-day hearing in February, in which social media managers took the stand and were questioned about how they monitored and moderated Facebook comments.
Rothman ruled in Voller's favour on Monday afternoon, finding that the media companies were the publishers, in a legal sense, of the comments.

The judge wrote that each company had the power to effectively delay reader comments on Facebook and monitor if they were defamatory before "releasing" them to the audience.

This was based on evidence from social media expert Ryan Shelley, who testified that although you can't turn off comments on Facebook posts, you can deploy a "hack" to pre-moderate them....MORE

Guggenheim Analyst: "Kraft Heinz is running out of cash" (KHC; BRK)

Be that as it may be, KHC's largest shareholder, Berkshire Hathaway (26.7% of Kraft Heinz) has $112 billion in cash and equivalents as of the last annual report which Mr. Buffett may be willing to deploy (at a price).
First up, this morning's story at CNBC: 
"Warren Buffett denies tensions with his partner in troubled Kraft Heinz, supports new Kraft CEO".

And second, from Yahoo Finance who seem to be doing more original reporting, the headliner from June 24:
Saving macaroni and cheese maker Kraft Heinz (KHC) may be one of the toughest gigs in Corporate America today (well that and trying to run what’s left of Sears).

But come July 1, veteran marketer Miguel Patricio will officially take his crack as CEO of Kraft Heinz. He assumes the mantle of a company left mostly in tatters by outgoing CEO Bernardo Hees, a long-time 3G cost-cutting focused executive who has led the company since its merger in 2015. The iconic company has been embarrassed by two years of terrible sales growth, a $15 billion write-down to the Kraft and Oscar Meyer trademarks, a depleted corporate culture, an awful stock price and a subpoena from the U.S. Securities and Exchange Commission related to an investigation of its accounting practices.

As we said, this won’t be an easy C-suite gig.

“In our view, Patricio faces a monumental challenge to put Kraft Heinz on a path to success as a standalone company,” contends Guggenheim Securities analyst Laurent Grandet.

Kraft Heinz’s stock has crashed 50% over the past year as its struggles have sent investors packing. The performance — fueled by years of under-investment in its plethora of brands in a bid to boost profits and an industry shift to fresher food — is more disappointing given the rally in comparable staples such as PepsiCo, Coca-Cola and General Mills.

But digging through Grandet’s latest note, one can’t help but to wonder if there is another shoe (or shoes) to drop at Kraft Heinz. A shoe that could completely obliterate the stock price.
“The company finds itself in a precarious situation where (1) the balance sheet is constrained by a high debt burden, (2) the brands are in dire need of heavy investment, (3) the organization lacks enthusiasm and the appropriate level of talent, and (4) the cash flow isn’t sufficient to fund all those urgencies concurrently,” writes Grandet.

What the new Kraft Heinz CEO has to do....

The stock is up a few pennies at $30.74.
It has not done well the last couple years:
KHC The Kraft Heinz Company weekly Stock Chart

The Bezos Empire in One Really Big Chart (AMZN)

From Visual Capitalist:

BofE: "All bark but no bite? What does the yield curve tell us about growth?"

From the Bank of England's Bank Underground:
The slope of the yield curve has decreased in the US and the UK over the last few years (Chart 1).

This development is attracting significant attention, because the yield curve slope (i.e. the difference between longer term government bond yields and shorter term government bond yields) is a popular business cycle indicator, and a fall of longer term yields below shorter term yields (i.e. an ‘inversion’ of the yield curve) has historically been considered as a powerful signal of recessions, particularly in the US. 

Chart 1: Slopes of the US and UK government bond yield curves (10-year yields minus policy rates)
Since Estrella and Mishkin (1998), a number of studies have documented that the slope of the yield curve has significant power in predicting economic slowdowns (see e.g. the recent survey by Claessens and Kose, 2017).  However, some – including FOMC members (e.g. Chair Powell) – have suggested that the slope of the yield curve is likely to contain less signals on the growth outlook than it has done in the past due to a number of changes that have taken place in interest rates markets.
To answer the question, in this post we analyse how the yield curve has performed as a predictor of GDP growth over time in the US and the UK, focussing on the performance of the different components of the yield curve: expected short interest rates and term premia.

How has the yield curve slope performed as a predictor of GDP growth over time?
We start by comparing the predictive power of different measures of the US and UK yield slope for GDP growth one year ahead. Specifically, in a similar spirit to Stock and Watson (2003), we predict the annual growth in real GDP one year ahead with the relevant yield curve slope, controlling for the latest available outturns of annual growth rate in GDP in real time and two additional lags. In other words, we condition the GDP forecast 1-year ahead only on the information available at each point in time. We use quarterly data since 1966 for the US, and a shorter series for the UK – since 1982, because of data availability. Within this framework, we analyse forecasts produced using a rolling estimation scheme (with a starting window of 15 years), and compare them with the forecasts obtained from autoregressive models that are based only on lagged GDP growth variables.....

"Senators get classified briefing on UFO sightings"

Following up on a June 17 post (below).
From Politico, June 19: 
Three more U.S. senators received a classified Pentagon briefing on Wednesday about a series of reported encounters by the Navy with unidentified aircraft, according to congressional and military officials — part of a growing number of requests from members of key oversight committees.
One of them was Sen. Mark Warner (D-Va.), the vice chairman of the Senate Intelligence Committee, whose office confirmed the briefing to POLITICO....
June 17, 2019

Back to the Future: "Wealthy families are adding forests to their portfolios"

We've noted the ebbs and flows of the real asset trade over the years and think it's probably time for a revisit.
From Bloomberg via Farmlandgrab, June 16:
Tom Crowder spent much of his two-year career in the NFL running away from men who weighed upwards of 300 pounds. These days? He worries about bears and snakes. As a senior vice president at Bank of America Corp., Crowder spends most days in the woods, from the evergreen forests of New England to the wetlands of the Carolinas, scouting U.S. timberland assets for people with a net worth of at least $100 million and a minimum of $10 million to invest.
“Trees don’t move as fast as Pro Bowl linebackers,” Crowder says on a recent field trip to a client’s timber farm in South Carolina overlooking the alligator-­populated Waccamaw River. As turtles sun themselves and wild turkeys roam, he recounts over a picnic lunch the “neat experience” of his stint as a wide receiver and safety for the Dallas Cowboys. After a busted jaw and emergency surgery, he was happy to go back to his roots, as a third-generation forester.
Crowder is among more than 200 experts employed by Bank of America’s Specialty Asset Management group, or SAM, which manages more than 94,000 assets with a value of $13.6 billion for individuals and institutions. The target client is looking for timberland, farms, ranches, energy interests, or real estate, so-called alternative investments that can diversify portfolios mostly made up of stocks and bonds and can provide a hedge against inflation.
Returns for timberland totaled 3.2% in 2018, compared with 2.4% so far this year, according to an index from the National Council of Real Estate Investment Fiduciaries. 
John Kelley, a SAM national executive, says “long-term themes” sell. The decline in arable land and rising global food demand, for example, are reasons to invest in farmland. “People have to eat, and what we believe about the intrinsic nature of these assets is that they have real value and they will persist over time,” he says.
For clients willing to make these long-term bets, SAM brings in what it calls boots-on-the-ground specialists from 38 offices across the U.S. They have an average of more than 15 years of experience, Kelley says, and some have been in their field for more than 30 years. Many, like Crowder, come from families who’ve been in those businesses for generations.
An exception is Nancy Fahmy, the head of alternative investments who was tapped to also lead SAM last year after spending most of her 23-year career dealing in esoteric financial assets in New York. “This is a different world for me,” she says, recalling the novelty of climbing onto a tractor for the first time and being intrigued by meeting a colleague wearing an impeccably tailored suit and alligator-skin cowboy boots, the product of a family hunt.
For Crowder, who grew up in Arkansas on his family’s timber farm, it’s familiar territory. While on the trip to the client’s timber tracts, a half-hour drive from Myrtle Beach in South Carolina, he used GPS maps on an extra-large iPad to show off an aerial view of pine trees annotated by the date they were planted. Then he offered instructions on how to use a T-shaped forestry tool, called an increment borer, to extract a section of wood about the size of a drinking straw from a tree to count its rings and gauge its pace of growth.
“People have to eat, and what we believe about the intrinsic nature of these assets is that they have real value and they will persist over time”
Crowder covered a lot of ground over the course of a day, giving a crash course in timber management. He detailed the widespread problem of wild hogs damaging timber properties. He talked about the benefits of recreational hunting clubs, which can offer a revenue stream for owners. He laughed about a catchphrase among colleagues—“release the deer”—a reference to the Chevy Chase movie Funny Farm. That’s what SAM staff say when an impressive animal is spotted on a site visit, as if they’d arranged it specifically to impress prospective buyers.
The bank’s roster of clients includes people from both the U.S. and overseas. Investors new to the arena are strongly encouraged to visit what they might be buying into, and it’s during these trips that the idea of passing on a legacy to future generations hits home, Kelley says. Wealthy families are also becoming more interested in environmental and sustainable investments, he says.
“It has a transformative effect in a lot of ways when they actually get to see it, feel it, touch it, and—sometimes in the case of farmland—smell it,” Kelley says. “It goes beyond the numbers.”
And the numbers for real-asset deals, such as predicted profits and hurdle rates, don’t correspond to typical Wall Street metrics. In some cases, the bank has to explain to sophisticated investors that the investments might not work for them.
The assets do produce revenue—in the form of logs, crops, livestock, or oil and gas—but buyers have to get comfortable with multiyear time horizons for returns. A timber farm could generate immediate sales or take years to harvest, depending on tree maturity and market conditions, or decades if starting from seed.
“This is not like stocks and bonds,” Kelley says. “This is not something that you buy on Monday and sell on Wednesday. That’s not the deal. If you’re not coming in with at least a minimum of a 10-year investment horizon, you really don’t belong in this investment class.”
There are other reasons to be careful. Universities including Yale and Harvard ran into trouble with their forestry investments in recent years after endowment funds bought into huge tracts of land as a way to hedge against inflation. The bets paid off handsomely until 2017, when returns slumped and the universities came under criticism from local residents and environmentalists. The various complaints included concerns about overlogging, destruction of scenery, and the disruption of animal habitats....MUCH MORE
Previously in the Paul Bunyan series:
"A Fine Time for Timber" (WY)
There are a half-dozen ways to invest in timberland, the REIT's being one of them. Unfortunately for non-institutional investors there are no pure play portfolio investments and neither the ETF's (CUT; WOOD) nor the REIT's are perfect proxies for timber. POPE Resources is set up as a Master Limited Partnership with a higher correlation to timberland. A couple of London traded vehicles, Phaunos Timber and Cambium Global Timberland Limited also have higher correlation to timberland.

If you can do direct investments the Timberland Management Organizations (TIMO's) will get you even more correlation with Forestland Group (3.5 MM acres) Campbell Resources (3.1 MM acres)  and Hancock Timber Resources Group ( 6.5MM under management) being the largest.
"Investing in Timber and Farmland" 

Grantham, Mayo, Van Otterloo: "A Farmland Investment Primer"

And many more, use the search blog box keyword 'Timber', if interested.

Monday, June 24, 2019

Batteries: Volkswagen Leads €886 Million Investment in Northvolt

From EU-Startups, June 14:

Volkswagen leads €886 million investment in Northvolt to power Europe with its gigafactory for lithium-ion batteries
The future will require sustainable batteries to store renewable energy, and lots of them. Stockholm-based Northvolt has taken the lead, and has just announced a capital raise of €886 million to build Europe’s first gigafactory for lithium-ion battery cells, Northvolt Ett, in Skellefteå, Sweden. This comes just a month after securing a €350 million loan from the EIB for the project, and represents another milestone for Europe as a leader in renewable energy. It is also the largest equity round in a European startup since Softbank’s investment in the Swiss biotech Roivant Sciences in 2017.
The funding round was led by the Volkswagen Group and Goldman Sachs, alongside the BMW Group, AMF, Folksam Group and IMAS Foundation.

Northvolt was founded in 2016 with the mission to build the world’s greenest battery cell, recyclable and with a minimal carbon footprint, to enable Europe’s transition to renewable energy. The lithium-ion battery systems being developed by the company range from small to large – enough to power a car, a house, or entire grids – and use data to track customer field usage patterns and to continuously improve design, performance, manufacturing, and more.

“Today is not only a great milestone for Northvolt, it also marks a key moment for Europe that clearly shows that we are ready to compete in the coming wave of electrification, and that we will do so using battery cells which carry the lowest CO2 footprint possible,” said Peter Carlsson, co-founder and CEO of Northvolt.

Building construction on the gigafactory in Skellefteå will begin this August, with large-scale production expected to begin in 2021. Northvolt Ett will serve as Northvolt’s primary production site, hosting active material preparation, cell assembly, and recycling. The gigafactory will be expanded to produce at least 32 GWh worth of energy capacity annually – roughly equivalent to 16x the energy output of the Hoover Dam, and about 10x more than America’s largest coal plant. 
Now, in cooperation with Volkswagen, the company has also announced plans to establish a second gigafactory in Lower Saxony, Germany....MORE
May 26 
May 9
November 2018 
Watch out Elon—VW to convert three German plants to build electric cars
November 2017
"Google and VW partner on quantum computing to improve electric car batteries"  
September 2017 
More on Northvolt, ABB and the 'World's Greenest Battery'
September 2017 
ABB Teams up with Northvolt on Europe's Biggest Battery Plant
March 2017 
"An Ex-Tesla Exec’s $4.2 Billion Battery Battle With Musk"
December 2016 
Tesla's European Gigafactory to Produce Cars, Batteries (TSLA)
Of course this doesn't happen unless the company can raise some serious money.
$3 to $12 billion serious.... 

"Persian Gulf War Risk Premiums Seen Costing $500,000 Per Oil Shipment"

Two via gCaptain:
June 24
The cost of insuring Middle East oil shipments is soaring as tensions mount in a region responsible for about a third of all seaborne petroleum.

So-called war risk premiums for a standard oil cargo from the Persian Gulf and the tanker hauling it can now cost upwards of $500,000, according to people familiar with the insurance market. Earlier this year, the same premiums would have cost owners less than 1/10 of that.

The vulnerability of maritime traffic to mounting tensions came into sharp focus on Monday when U.S. President Donald Trump said other nations need to do more to help protect navigation from the Middle East in the wake of six attacks on tankers since early May. The incidents, which American officials blamed on Iran, prompted an adviser to insurers to classify the entire Persian Gulf as a riskier area for shipping, giving underwriters scope to charge bigger premiums.

“This will get passed on the the customers,” said Sandy Fielden, an analyst at Morningstar Inc. “Refiners are paying more for crude and they will pass on the cost to customers if they can. If refiners choose not pass that along, their margins would get squeezed.”

The insurance prices being lifted fall into two categories: one is for the vessels themselves, the other for their cargoes. While the cost of covering the tankers surged as soon as the most recent attacks happened, the surge in prices for the cargoes only happened over the past week.

Underwriters are now aiming to charge anywhere from $150,000 to $325,000 to cover a cargo valued at $130 million, the people familiar with that market said. Until this week, the same cover cost $1,000 or less. Insuring the tanker itself now costs in excess of $200,000, based on a $75 million vessel. That’s up from less than $30,000 at the start of 2019....MORE
And June 21:
Shipping Rates for Mideast Oil Are Surging
Oil tanker owners are raising the prices they charge to export Middle East crude as tensions surge in a region that accounts for about a third of all seaborne petroleum shipments.

Rates for transporting 2 million-barrel cargoes from Saudi Arabia to China jumped to almost $26,000 a day on Thursday, more than double where they were at the start of June, according to Baltic Exchange in London. Shipbrokers report a surplus of vessels in the Persian Gulf, indicating that owners are reluctant to accept charters at low rates given the current risks.

“Nothing much has changed in terms of supply and demand since the latest attacks, so it’s pretty much all a risk premium,” said Halvor Ellefsen, a shipbroker at Fearnleys London.

A survey of shipbrokers involved in the Middle East trade shows they anticipate there being 22% more ships available for charter in the next four weeks than probable cargoes. That’s a smaller surplus than last week but still higher than normal for the time of year.

Trading Paused 
Despite the glut, vessel owners including Frontline Ltd., one of the world’s biggest operators of supertankers, briefly paused charters in the immediate aftermath of the latest round of attacks in the region last week....MORE

"USDA crop progress: Focus shifts from planting to crop quality"

Following up on our earlier "Crop Progress Report June 24: Crops Are In, How Are They Doing?".
From Feedstuffs:

Corn quality erodes last week, per the latest agency data 
USDA is typically done reporting corn planting progress by late June, but this spring’s set of unusually wet circumstances has the agency still reporting those numbers for the week ending June 23. Other highlights of this week’s report include soybean planting progress, corn and soybean crop quality, and winter wheat harvest progress.

Corn planting progress is now at 96%, up from 92% a week ago. More states crossed the proverbial finish line, with Indiana (91%), Michigan (91%) and Ohio (80%) still the farthest behind so far. Among the top 18 production states, 89% of the crop is emerged, versus 100% last year and a five-year average of 99%.

Corn crop quality took a big step back last week, meantime, moving from 59% in good-to-excellent condition down to 56% last week. Another 32% of the crop is rated fair (up a point from a week ago), with the remaining 12% rated poor or very poor (up three points from last week). Analysts were expecting USDA to hold quality ratings steady.

Soybean planting progress remains significantly behind the pace of recent years after reaching 85% last week. That was a small improvement over the prior week’s tally of 77% but much slower than 2018’s mark of 100% and the five-year average of 97%. Missouri (66%), Michigan (69%) and Ohio (65%) are the farthest behind so far.

Soybean emergence has reached 71%, up from 55% a week ago but far behind 2018’s pace of 94% and the five-year average of 91%....

See also the weekly Crop and Weather Bulletin. Here's last week':
Agriculture: The Crops Are Either Planted Or Won't Be, So What's Next?

Coming up, the 637 ag professional to follow on Twitter.
(sorry, just kidding. sometimes I get excited)

Crop Progress Report June 24: Crops Are In, How Are They Doing?

During the planting season we lead with the planted tables, now we switch to the 'Emerged' and 'Condition' tables.
From the U.S. Department of Agriculture:

Corn Emerged - Selected States
[These 18 States planted 92% of the 2018 corn acreage]
                 :            Week ending            :           
      State      : June 23,  : June 16,  : June 23,  : 2014-2018 
                 :   2018    :   2019    :   2019    :  Average  
                 :                    percent                    
Colorado ........:     99          86          93          99    
Illinois ........:    100          74          84         100    
Indiana .........:    100          61          79          98    
Iowa ............:    100          88          96         100    
Kansas ..........:    100          83          92          98    
Kentucky ........:     99          91          95          98    
Michigan ........:     91          48          63          98    
Minnesota .......:    100          87          96          99    
Missouri ........:    100          80          85          98    
Nebraska ........:    100          90          95         100    
North Carolina ..:    100         100         100         100    
North Dakota ....:     99          86          95          98    
Ohio ............:     99          50          66          99    
Pennsylvania ....:     87          86          91          93    
South Dakota ....:    100          56          79          99    
Tennessee .......:    100          99         100          99    
Texas ...........:     99          90          94          98    
Wisconsin .......:     99          66          81          98    
18 States .......:    100          79          89          99    

Corn Condition - Selected States: Week Ending June 23, 2019
[These 18 States planted 94% of the 2018 corn acreage]
      State     : Very poor :   Poor    :   Fair    :   Good    : Excellent 
                :                          percent                          
Colorado .......:     -           4          27          63           6     
Illinois .......:     5          12          36          41           6     
Indiana ........:     4          14          39          38           5     
Iowa ...........:     2           6          30          52          10     
Kansas .........:     3          10          37          43           7     
Kentucky .......:     2           4          18          62          14     
Michigan .......:     4          20          36          37           3     
Minnesota ......:     2           6          33          50           9     
Missouri .......:     8          25          39          26           2     
Nebraska .......:     1           3          19          66          11     
North Carolina .:     3           8          41          43           5     
North Dakota ...:     -           5          22          68           5     
Ohio ...........:     5          15          41          34           5     
Pennsylvania ...:     1           4          24          59          12     
South Dakota ...:     1           5          38          48           8     
Tennessee ......:     1           3          22          54          20     
Texas ..........:     1           3          25          57          14     
Wisconsin ......:     3          10          35          41          11     
18 States ......:     3           9          32          48           8     
Previous week ..:     2           8          31          52           7     
Previous year ..:     1           4          18          58          19     
-  Represents zero.                                      

...MUCH MORE (19 page PDF)

"The Decline of American Journalism Is an Antitrust Problem"

Well that and a J-school problem and a societal problem and a general education problem and a zeitgeist problem and....a whole bunch of things but one point of attack would be the effect of the platforms on revenue which, if molded in the journos favor might slow the decline enough that you won't have to hire folks characterized by Ben Rhodes as:
“....The average reporter we talk to is 27 years old, and their only reporting experience consists of being around political campaigns. That’s a sea change. They literally know nothing.”
—NYT via Foreign Policy, May, 6, 2016 "A stunning profile of Ben Rhodes, the asshole who is the president’s foreign policy guru
So yeah, work on the money and the rest of the stuff gets easier as the quality improves.

From the University of Chicago's ProMarket:

Weak antitrust enforcement set the stage for Facebook and Google to extract the fruits of publishers’ labor. We won’t be able to save journalism and solve our disinformation problem unless we weaken monopolies’ power.
As a former antitrust enforcer, I believe that the starving of journalism and the disinformation crisis are in good part monopoly problems. I’ve been writing about antitrust and tech platforms since the summer of 2016, when I noticed that the tech giants—Google, Amazon, Facebook, and Apple—were doing the same types of things Microsoft had been sued for nearly 20 years earlier. They were leveraging their market power to make fair competition impossible.

These tech giants are gatekeepers that also compete against companies that must get through their gates to reach users. News publishers must get through Facebook and Google’s gates due to the two platforms’ concentrated control over the flow of information. But Facebook and Google compete against news publishers for user attention, data and ad dollars. They are controlling the game and playing it too.

Publishers never had a fair shot, nor do they have bargaining power against the platforms. The platforms can cut them off with a simple tweak of an algorithm. Facebook and Google exploit their middlemen positions to divert ad revenue away from publishers and into their own pockets.

And the platforms can hyper-target users based on their 360-degree views of what their users read, think, and do, thanks to their ability to track users across millions of websites and even offline. Last year, Facebook and Google accounted for approximately 85 percent of the growth of the more than $150 billion North America and EU digital advertising market, according to Digital Content Next, a main trade association for publishers.

As for disinformation, Facebook and YouTube program their algorithms to prioritize engagement, which amplifies propaganda. Through surveillance, Facebook and Google learn what messages people are susceptible to, whether ads or propaganda. Then they rent out these manipulation machines to others for huge profits. The scale of the manipulation is massive—because of Facebook and Google’s dominance.

The platforms lack competitive pressure to fix the disinformation problem. The closest substitute for Facebook users is Instagram, which it owns. Users need to be able to vote with their feet and switch to alternatives....MUCH MORE
For one, just one, example of what the lack of money has done to the newspaper and TV news business here's July 2017's "Automation, Fact Checking and the Decline of the News Business (plus Tracy and Hepburn)":
....In 1957, daily papers and television stations in most major cities had dozens of research librarians working in shifts almost round the clock. Their work was essential for ensuring accuracy in the news. In 2012, Paul Friedman reported in the Columbia Journalism Review that CBS’s entire news research staff was down to three full-time employees. Friedman tied this figure to an overall cut in global coverage, a consequence of the networks’ new preference for trivial and sensational “news-lite” about affairs such as gas prices, weekend weather forecasts, and feature interviews with celebrities.
This shift was the result of a corporate branding decision that the networks undertook more or less simultaneously: as Friedman explains, the networks hoped to combat declining viewership with specialized newscasts tailored to each lead anchor’s personality. The resulting evening news broadcasts, while no longer nearly identical, became equally insipid. Observing a similar devolution away from ambitious investigative print journalism, CJR reported in 2013 that long-form news reporting, which for the sake of statistical comparison it defines as articles over 2,000 words, had declined 86 percent in the decade between 2003–2013....
And in 2015:
Sorry Fact Checkers, The Robots Are Coming For Your Jobs
I'm not sure how transformational this actually is as it appears many organizations have already dispensed with the services of fact checkers....

"Trump, Trudeau seek collaboration on 'critical minerals': White House"

From Reuters, June 20:
U.S. President Donald Trump and Canadian Prime Minister Justin Trudeau ordered officials on Thursday to develop a plan for U.S.-Canada collaboration on “critical minerals,” the White House said in a statement after a meeting of the two leaders.

Washington has grown concerned about its dependence on imports of rare earth minerals from China after Beijing suggested using them as leverage in their trade war....MORE
"United States aims to reshape the critical minerals world"
Following Trump's Executive Order on Critical Minerals the Interior Department Begins First Ever National Survey of Same

Markets: Give Me A Sign O Lord

Via Paranoid Bull:

Oh Elon: He Meant To Post A Picture Of Mars....

First up, Mr. Musk's Twitter feed:

A commenter:

Navigation can be tricky.

Vivien home

The BIS Talks Fintech, Big Fintech, and Corporate Crypto

This is about as topical as it gets.
From FT Alphaville:

A pound of flesh for your Libra inclusion
The Bank of International Settlements (BIS) has just released its annual economic report and this year it features a special chapter on the entry of big tech into finance.

The chapter couldn't be more topical, says BIS economic adviser and head of research Hyun Song Shin.

“We chose the right week to launch our chapter,” Shin notes in reference to the launch of Facebook's Libra coin last week.

But while it would be tempting to linger on BIS views about Facebook's audacious plans to literally almost take over money, that would be to overlook some of the more nuanced but equally important views about fintechs in general.

The report's key point is that the entrance of big tech into finance promises all sorts of efficiency and financial inclusion gains — which is a good thing — but those gains mustn't come at the cost of other things like privacy, financial stability and market competition.

To wit, there's an implicit suggestion that the regulatory landscape needs to change to address these new multi-faceted issues. It comes by way of this regulatory compass which shows how three core regulatory issues intertwine in the presence of big tech in finance: 1) Financial regulation. 2) Competition regulation. 3) Privacy....

"Beyond the Fed's Pivot"

From Pension Pulse, June 21:
Jeffrey Gundlach, chief executive of DoubleLine Capital and the most widely followed bond investor, said the Federal Reserve’s dovish turn in its policy statement on Wednesday took its lead from the bond market:
The Fed is doing “what the bond market says - with a lag,” said Gundlach, who oversees more than $130 billion in assets. “The bond market definitely helped to encourage the ‘Fed pivot.’”

The Fed on Wednesday signaled it could cut interest rates by as much as half a percentage point over the remainder of this year, as it responded to increased economic uncertainty and a drop in expected inflation. The U.S. central bank’s next policy meeting will be held in July, with the following meeting in September.

In a telephone interview with Reuters, Gundlach said economic data would have to be weak for the Fed to slash rates in July. If policymakers do cut rates next month, “They are basically admitting they are behind the curve,” he said.

Federal funds futures implied traders were fully pricing in the U.S. central bank lowering rates at the July 30-31 policy meeting.

“The only way they cut is if the data is sustaining a negative tone and that we have sustained economic weakness,” Gundlach said.

“One interest rate cut is not going to forestall recession,” he added. “It increases the chances that we are headed into recession.”
In an interview on Fox Business on Wednesday, Gundlach also said Trump’s re-election chances depend almost entirely on the economy. And just last week, he predicted a 40% to 50% chance of a US recession within the next six months, and a 65% chance of a recession in the next 12 months.

Gundlach is also joining dollar bears, calling it a moment of truth for the US dollar:
With all due respect to the 'bond king' (PIMCO is quietly outperforming Gundlach's fund), the US dollar ETF (UUP) is just pulling back here and the rest of the world is still swamped in negative-yielding debt, so it's hard to get too negative on the greenback here:


"Soybeans Could Be Next Market to Surge as U.S. Showers Drag On"

From Bloomberg:

 Updated on
Corn prices have been on an epic run. Now, soybeans could soon be catching up.
  • Hedge funds are backing away from bearish soy wagers
  • Corn is heading for best quarterly advance since 2010
With more rains forecast for the U.S. Midwest, oilseed plantings are under threat and hedge funds are backing away from their bearish wagers. Meanwhile, corn is heading for its best quarterly advance since 2010 and the funds are betting there’s more room to run, raising their net-bullish holdings to the highest in a year.

Fields are still flooded, keeping farmers from seeding and threatening yields. Cooler and wetter-than-normal weather remains in the forecast. The U.S. Department of Agriculture will update its plantings estimate on June 28, but analysts and traders are already concerned the agency’s numbers will be too high and not fully reflect the impact of the deluge.

“Most people would suggest this survey is a little dated,” Rich Nelson, chief strategist at Allendale Inc. in McHenry, Illinois, said, referring to the USDA report.

In the weeks and months ahead, the agency likely will have to take down estimates both for U.S. soy acreage and yield to reflect major planting delays, Nelson said. That could boost soybeans prices that lagged behind corn’s big run. Most-active rolling futures are heading for a gain of about 5% this quarter, while the grain has surged about 27%.

Soybeans have trailed for a reason. In the U.S., the oilseed can be planted later in the spring than corn. Amid the heavy rains, some analysts had forecast that the weather would eventually clear and farmers would plant more soy. That would’ve meant bigger production at a time when demand is already suffering amid the U.S.-China trade war.....MORE

What's Left Of ISIS is Burning Iraqi Crops in the Fields

From Reuters:

After years of war and drought, Iraq's bumper crop is burning
Iraqi farmer Riyadh woke on May 13 to find his wheat crop ablaze. In his fields in Diyala province, he found the remains of a mobile phone and plastic bottle which he believes was an explosive device detonated in the night to start the fire. 

Riyadh and his neighbors in Sheikh Tami village put out the blaze and saved most of his crop but hundreds of other farmers in Iraq have been less fortunate since Islamic State urged its supporters to wage economic warfare with fire.

Since the harvest began in April, crop fires have raged across Diyala, Kirkuk, Nineveh and Salahuddin provinces while the government, battered by years of war and corruption, has few resources to counter a new hit-and-run insurgency.

The government in Baghdad is playing down the crisis, saying very few fires have been started deliberately and only a fraction of the country’s farmland has been affected.
But officials in Iraq’s breadbasket province Nineveh warned that if the fires spread to storage sites, a quarter of this year’s bumper harvest could be at risk, potentially ending Iraq’s dream of self-sufficiency after years of disruption due to drought and Islamic State rule.

Iraq declared victory over Islamic State in December 2017 but the militants have regrouped in the Hamrin mountain range which extends into the northern provinces - an area described by officials as a “triangle of death”. 

In recent weeks, IS has published detailed instructions online about how to carry out hit-and-run operations and weaken the enemy by attrition - without taking losses.

“It looks like it will be a hot summer that will burn the pockets of the rejectionists and apostates, as well as their hearts,” Islamic State wrote in its al-Naba newspaper last month, referring to Shi’ite Muslims and Sunnis who do not subscribe to its interpretation of Islam.

Prime Minister Adel Abdul Mahdi said last week that only about a 10th of the fires were the result of sabotage, with the rest caused by electrical faults, cigarette butts or faulty agricultural machinery....

Sunday, June 23, 2019

"The Invention that Saved A Million Ships"

A major report on a major story.

From the BBC, June 21:

In the 1820s, Augustin Fresnel invented a new kind of lens and installed it in France’s Cordouan lighthouse. Suddenly, one lamp could light the way for sailors many miles out to sea.
“Were I a Roman Catholic, perhaps I should on this occasion vow to build a chapel to 
some saint; but as I am not, if I were to vow at all, it should be to build a lighthouse.” 
 — Benjamin Franklin, July 1757
Since antiquity, lighted beacons have guided ships to port. The earliest lighthouses were controlled fires on hilltops that warned vessels that they were approaching land. Over time, these signals were powered by burning coal or oil lamps backed by mirrors, which could reach navigators further out to sea. But lamp power was no match for a dark and stormy night; over centuries, broken hulls and wind-whipped sails ran aground as ships’ captains and crew perished within, unable to spot the coastline before it was too late.

All that changed in the early 1820s, when a French physicist invented a new kind of lens: a ring of crystalline prisms arranged in a faceted dome that could reflect refracted light. Augustin Fresnel installed his creation in the Phare de Cordouan, a towering lighthouse situated in France’s Gironde estuary, about 100km north of Bordeaux. Suddenly, one lamp could illuminate the way for sailors many nautical miles out to sea.

The oldest operating lighthouse in France (construction began in the 16th Century, but beacons had existed there hundreds of years prior) and the world’s first to be built in the open sea, this imposing sentinel of white stone is a Renaissance masterpiece. Equal parts cathedral, fort and royal palace, this ‘Versailles of the Sea’ is a monument to history and maritime engineering. The spot was listed as an historic monument the same year as Paris’ Notre Dame by the French Ministry of Culture, in 1862. Accessible only by boat, the Cordouan lighthouse offers visitors a revolutionary view of France’s heritage: the chance to climb inside the upper reaches of an old lighthouse, and into one man’s imagination.

A spectacular showpiece
The Médoc Atlantique is a bountiful stretch of south-west France famous for its vineyards, wines and chateaux; few tourists venture north of Bordeaux to the sleepy town of St Palais-Sur-Mer. From this vantage, the Cordouan lighthouse is unmissable on its lonely promontory, though Palais’ residents seem only dimly aware of its faithful watch. Beachside cafes touting fresh fish and Nutella-filled crepes are popular with locals, and many will take a boat ride to trawl for Coquilles St Jacques and then explore the surrounding pine forests. But once a day, a catamaran departs from Port Royan, taking passengers out of the harbour and into open waters. As the town fades from view and the ship’s sails flap wildly in the wind, the lighthouse rises up, breaking the horizon like a pillar of cloud. Most cannot help but wonder: why build such a magnificent showpiece where few would ever see it?

In fact, the Phare de Cordouan’s spectacular architecture is the result of a long and turbulent history. According to legend, small beacons had existed on the unnamed islet since the early 9th Century, when Charlemagne supposedly commanded a light be shone there. It’s more certain that the Black Prince (Edward of Wales) was the first to build an actual tower on the sandbar, in 1360. More than 200 years later, in 1584, King Henry III commissioned a lighthouse at the mouth of the Gironde. The king wanted an impressive tower worthy of his royal stature, one that would replace Edward’s crumbling edifice. He contracted famed Parisian architect Louis de Foix with orders to construct a ‘royal work’: a lighthouse with extravagantly decorated apartments, keepers’ quarters, a large lantern and its very own chapel.....MUCH MORE
The frequency of shipwrecks and the enormity of the loss of life, even up to the last century is just staggering.
A post may be in order.

Saudi Official: "The blood conflict had lasted too long. Us Saudis and all Gulf States plus Egypt and Jordan realize that the age of going to war with Israel is over."

Big if true.
From the Jerusalem Post, June 22:

Saudi official says 'Deal of Century' leads to full Palestinian statehood 
The official slammed Palestinian leadership as “irresponsible” for not even considering the Deal of the Century, which will bring 60 billion USD to their people.
“History and Allah brought a real opportunity,” a top-ranking Saudi diplomat told Israelis via an interview in Globes on Friday. “The blood conflict had lasted too long. Us Saudis and all Gulf States plus Egypt and Jordan realize that the age of going to war with Israel is over.”
Pointing to “the advantages of normalizing relations,” he argued that “the whole Arab world could benefit from it,” Globes reported. 
The Saudi diplomat told Globes that “Israeli technology is very advanced and the Arab world, including those who hate you, looks at Israel in admiration due to this success and hopes to copy it.”
He further stated that despite the understanding among Saudi people that the age of war with Israel needs to end, the kingdom has a deep commitment to the Palestinians.

“Maybe it is hard for them to part with the character of the ever-suffering victim and they don’t believe they could survive without it,” he said, noting that if they accept the American peace plan they will be given “sums they never dreamed of.”...

I was under the impression Jordan was going to reject the plan, the Palestinians already have but that might be a negotiating tactic.

Here's the part of the Globes interview on Palestine, via Google Translate:
....When will the connection with Israel be published? When will an Israeli representative visit, as happened in the United Arab Emirates, Oman, Bahrain and others?
You have to understand that Saudi Arabia has a deep commitment and responsibility to the Palestinians, which was reflected in the renewal of the king's promise to Palestinian Authority Chairman Mahmoud Abbas at their last meeting that he would not allow the advancement of diplomatic moves that would harm the Palestinian leadership. And yet both the King and the crown prince are trying to persuade the Palestinians to seriously examine political and economic developments. "
That is a century plan?
"We also and other countries are willing to invest huge sums in this, amounts that the Palestinians did not dream of receiving, and if this framework starts to run, they will export to true independence, education Well, employment, a healthy economy and not dependent on charity. "Here he stops, hesitates and then says:" It may be difficult for them to emerge from the image of the eternal victim and they do not believe they can manage without it. "
As for the diplomatic issue, the Saudi diplomat is surprising. According to reports, senior advisers to President Donald Trump, Jared Kouchner and Jason Greenblatt, talk about a state with reduced powers, but he says that the plan is expected to bring a real state for the Palestinians.
"As far as we know, the plan has a clear track leading to full Palestinian independence at the end of the process. We also have reservations about the American proposals on a number of issues, especially Jerusalem and Haram al-Sharif, but we are convinced that even the most complex questions can be solved when the stomach is full and life is calm, that is, when the economic situation improves, there is no violence and there is a real horizon. And that the Palestinians still do not accept. "
We published in "Globes" in October that they were offered billions in order to enter into negotiations on the basis of the centennial plan.
"Indeed, the publication came to us mainly after the Foreign Office in Washington tried to deny it, and then the Palestinians themselves admitted that it was true. The plan has undergone transformations, and if initially it was $ 10 billion in investment in the territories of Palestine, it currently encompasses a sum of six times more, and mainly includes other countries, led by Jordan and Egypt. You have to be irresponsible and leadership in order not to consider such a move. "...
Of course it could all be propaganda, it is just so difficult to pick out the truth from the packaging.

"Maersk to Pilot New Biofuel with Select Companies"

From World Maritime News:

A new carbon neutral product, the first of its kind in the industry, is being piloted with select Maersk customers engaged in sustainable solutions for their supply chain.
H&M Group is the first company to trial it as part of the shift towards carbon-neutral transportation.
The biofuel in the pilot project is the same blend of used cooking oil and heavy which has been tested and validated in a trial driven in collaboration with the Dutch Sustainability Growth Coalition (DSGC) and Shell earlier this year.

“The biofuel trial on board Mette Maersk has proven that decarbonized solutions for shipping can already be utilized today, both technically and operationally. While it is not yet an absolutely final solution it is certainly part of the solution and it can serve as a transition solution to reduce CO2 emissions today,” Søren Toft, Maersk COO, said.

The biofuel to be utilized is carbon neutral and provides H&M Group the ability to reduce their transport and logistics emissions towards their path to carbon neutrality, when accounting for only the emissions from the vessel.....MORE

Wilding: "Oh, Give Me a Home Where the Wild Cod Roam"

From Hakai Magazine:

A novel application of auditory training opens the door to more efficient cod ranching.
It took a week for Björn Björnsson to train 20 wild cod. In a compelling demonstration of classical conditioning, the aquaculture researcher at Iceland’s Marine and Freshwater Research Institute taught the fish to associate a low-frequency sound with a free meal. It only took another day for Björnsson—with the help of one of his trained fish—to teach another 19 wild cod.

People might not think of cod as herd animals, but Björnsson says cod are adept at reading social cues to learn where to grab a bite. The end result of this training? Dozens of Atlantic cod congregating around a floating platform moored in an Icelandic fjord, ready to be plucked from the water in a fisher’s net.

In a case of the Wild West meets the open ocean, fish ranchers may one day ride the watery range with boats instead of horses, dropping forage fish into feeding stations and taking stock of their herds with sonar.

Fish ranching—rearing stocks of free roaming fish—falls somewhere between traditional commercial fishing and fish farming. Proponents like Björnsson say ranching is more efficient than farming and results in fewer accidental catches of endangered species or young cod than traditional fishing. In previous, larger-scale experiments that didn’t employ sound-based training, Björnsson and his colleagues found that just by leaving feeding stations in the water, thousands of adult cod would gather around. He says smaller fish species and younger cod tend to avoid the herds—probably out of fear of being eaten. A 2012 paper, also by Björnsson, showed that ranching has the potential to yield higher profit margins than fishing or fish farming.

Fish ranching is not an entirely new idea: it’s been tried in Norway with wild saithe (a fish in the cod family), in Japan with red sea bream, and elsewhere. The addition of sound-based training, however, has the potential to make it even more effective.

Yet aquacultural engineer Boaz Zion, of Israel’s Agricultural Research Organization, says that even after nearly 20 years of effort, proponents of fish ranching have produced little momentum. Björnsson and others have “a long way to go proving the concept in a way that will convince commercial fishermen to get into it,” says Zion, who was not involved with the research....

And more on our friend the cod later this week.