Wednesday, January 26, 2022

"Russian Billionaires Lost $28Bln in Market Sell-Off"

From The Moscow Times, January 26:

Russian billionaires have lost a combined $28 billion in recent days amid drastic falls in the value of Russian companies and the ruble in response to mounting fears of military conflict.

The Russian stock market is down by around 20% this year alone, and the ruble has approached an all-time low of almost 80 against the U.S. dollar as investors have ditched Russian assets.

Amid the sell-off, 76 out of the 104 Russians in the Forbes Global Billionaires list have seen their wealth fall since the end of December 2021, Forbes reported.  

The combined loss of wealth amounts to $27.9 billion, according to the Forbes Real-Time calculator, which tracks the value of high-net-worth individuals based on live share prices and exchange rates.....


"As arable land disappears, a genetic tweak might secure the world’s food supply."

From, January 19, 2022:

Plants Fight for Their Lives

It’s 2050. The world population has increased by 2.3 billion to 9.9 billion. Demand for food has risen 70 to 100 percent but a warming planet, extreme weather, and a decrease in arable land is threatening food security. Luckily, farmers can grow crops more densely, increasing yield from smaller plots of available agricultural land.

Packing crops so tightly wouldn’t have been possible three decades earlier. That’s because despite looking docile, plants are actually hypercompetitive. Grow two plants too close together and they start competing for resources like minerals, water, nutrients, and—once they start to shade one another—sunlight. Without adequate light, plants adapt rapidly through what’s called shade avoidance response (SAR). They reallocate energy into growing taller in an effort to harness sunlight, which results in stunted root growth and accelerated flowering time.

We’re not trying to be Dr. Frankenstein. We’ve been modifying genomes for 10,000 years.

“This comes at a tremendous cost,” explains Ullas Pedmale, an assistant professor at Cold Spring Harbor Laboratory, where his lab studies the interactions of plants and the environment. “This change in energy basically leads to lower crop and biomass yield. The plant is now like, ‘Hey, I’m stressed, I’ve got very limited light, so let me make my offspring or seeds as soon as possible,’ because now the plant is thinking about its Darwinian evolutionary pressure to increase reproduction as soon as possible.”

Understanding SAR is especially important as major food crops—such as wheat, corn, potato, and tomato—are shade avoiders. But what if there was a way to grow plants densely without sacrificing yield? By learning about the genes involved in shade avoidance, Pedmale thinks he can shut down the plant’s state of distress, and perhaps engineer plants that can access sunlight but not panic into flowering early and stunting root growth thereby reducing yield.

Pedmale has been researching how plants perceive and modify their architecture in response to light. Specifically, he is studying a group of proteins called cryptochromes, what he calls one of the eyes of the plant. Cryptochromes, the only group of receptors common among animals and plants, sense changes in the availability of blue light. A reduction in blue light or red light with an increase in far-red light indicates that a plant is in the shade, prompting it to switch on genes that, among other responses, stunt root growth. Understanding cryptochromes and their interplay with these genes could be an important aspect of mediating these responses and the key to growing crops at higher densities....


"Vertical farming company Plenty raises $400M, partners with Walmart to supply greens"

The amount of money going into factories that grow leafy greens probably means I am going to have to work on my repertoire of salad jokes (a niche genre but big yucks with the right audience).

From FoodDive, January 26:

Dive Brief:

  • Plenty has raised $400 million in a Series E funding round, which it claims is the largest to date for an indoor farming company. New investors One Madison Group and JS Capital led the round, which also included Walmart and SoftBank Vision Fund 1. Walmart and One Madison Group will join Plenty’s board of directors.
  • Plenty plans to use the funds to support its growth strategy of selling product from its farms directly to partners. In a new strategic partnership with Walmart, Plenty will provide vertically farmed produce to the retailer's stores, including all of its California locations. 
  • Walmart said it plans to create a “new, market leading product category” in vertically farmed produce that’s available to shoppers year-round. Plenty's massive funding round and strategic partnership with the retailer quickens the pace of growth in the indoor farming space over the past year.... 


We've been tracking this phenomena for a decade. Here are some of our posts in reverse chronological order. And here is the a TL;dr takeaway:

Always keeping in mind that vertical farms are growing the highest-value crops to justify their cost. So no beans or wheat or rice or potatoes or barley or any of the other crops that supply the majority of calories that humans consume....

"Elon Musk says Tesla's humanoid robot is the most important product it's working on — and could eventually outgrow its car business" (TSLA)

After reporting some seemingly fine numbers TSLA closed down $7.90 afterhours.

However....if current action in the futures (Nasdaq down 1.96%; S%P500 down 1.64%) foreshadows tomorrow's open TSLA could be rocked, socked and shell-shocked. So maybe Elon was getting out in front of things by talking about the anthropomorphic robots.

And, as I said back in 2013 and still believe nine years later:

Anthropomorphic/biomimetic robots creep me out.
There, I said it.

From Business Insider via Yahoo Finance, January 26:

  • Elon Musk says Tesla's humanoid robot is the most important product it's developing in 2022.

  • Tesla is also working on the Cybertruck pickup, Roadster supercar, and Semi tractor-trailer.

  • Musk said the robot project could be "more significant" than Tesla's car business.

If you ask Elon Musk, the most significant new product Tesla is developing in 2022 isn't the Cybertruck pickup or the Roadster supercar. It isn't even a vehicle.

During Tesla's earnings call on Wednesday, Musk said the company's future humanoid robot — internally named "Optimus" — is the "most important product development we're doing this year."

Musk first unveiled the robot during Tesla's AI Day event in August. The automaker intends for the 5-foot-8-inch, 125-pound machine to take over dangerous, repetitive, physical tasks from humans in the future. Optimus, also known as the Tesla Bot, will run on the same artificial-intelligence system that powers Tesla's driver-assistance technology such as Autopilot, Tesla said.

On Wednesday's call, Musk said the robot project "has the potential to be more significant than the vehicle business over time." He said the first application for the robot would likely be at Tesla, "moving parts around the factory or something like that."

At its reveal, Musk said Tesla plans to have a prototype by sometime in 2022.

"The foundation of the economy is labor," he said Wednesday. "So what happens if you don't actually have a labor shortage? [sic] I'm not sure what an economy even means at that point. That's what Optimus is about. So – very important."

Musk's comments may disappoint Tesla customers and investors who were eager to hear updates on the automaker's long-promised future vehicles, like the Cybertruck, Roadster, and Semi heavy-duty truck....


Crypto Bros Talk Bonds

From David Schwael:

The comment thread quickly veers off into insanity, initiated by Joe Weisenthal (Tracy Alloway's co-host on the Odd Lots podcast)

Honestly, the comments reminded me of nothing so much as the Latin speakers in "Yesterday I Learned About ATMs":

It started with Paul Murphy at Alphaville's Markets Live:...

...Which of course lead to the question "Do the Vatican Bank ATM's really have instructions in Latin?"
(I had heard that from a less-than-reliable-source)

As it turns out, the answer is:,fl_progressive,q_80,w_800/17ktqx1deauuejpg.jpg

Yes, Latin is one of the language options.
In fact there's even a TIL thread at reddit.
Which managed to stay on topic for about four comments:
Pope: Why do I have to push "1" for Latin? It should only be Latin! If you're gonna come here, learn the language! Foreigners!

"And then they ask 'Are you sure you want to withdraw $DCXLII?'"
"$642? The ATMs in the Vatican give out ones!?"
Smallest note in the EU is €5 Maybe it's €640 and two Hail Marys?

"Romanes eunt domus."
The line is "People called 'Romanes' they go the house." "Romanes" is not a Latin word; he pluralized a second declension word as if it were third declension, so it doesn't translate to anything.

"Eunt?? What is eunt???"
3rd person plural present active of the verb 'eo, ire', meaning to go.
And from there it just descended into madness.

Until Il Papa decided to show off by making a withdrawal:
There's more than one way to move money through the æther..

"Brent Tops $90 As Oil Prices Dip Then Rip After US Inventory Data"

 From ZeroHedge:

Update (1130ET): Dip-buyers charged in to buy oil after an initial dip following DOE's report of a surprise crude inventory build.

WTI is up near $88

And Brent broke above $90...

That is the first time Brent is above $90 since October 2014...

A string of Wall Street banks including Goldman Sachs have forecast oil will hit $100 a barrel this year as the global market tightens.

“The market has basically been in persistent undersupply since mid-2020, thanks to OPEC+ cuts and a continued oil demand recovery,” said Helge Andre Martinsen, a senior oil analyst at DNB ASA.

“We fully acknowledge that the world is not running out of oil resources, but we might enter an oil-market squeeze triggered by too little investment and oil demand rebounding quickly.”

Prices are also moving on mounting concern over a possible Russian incursion into Ukraine, with President Biden saying he’d consider sanctioning Vladimir Putin if the Russian leader orders an invasion....


As always, thank you to ZH for the green arrows, a great assist for the directionally challenged.

If interested in more on our recent thinking re: oil see:

The Lack Of Prospects For ESG (at the moment)

Platts' "Commodity Tracker: 5 charts to watch this week"

ECB: "Looking through higher energy prices? Monetary policy and the green transition"

....She pretty much lays it all out right there. As with European carbon, it appears that we have an upwardly moving market price created by rules and regs. If the above doesn't communicate what has been decided let's try....

"McKinsey calculates the staggering capital spending required to reach net-zero by 2050"

You are going to have to dig deep into your pockets. Really, really deep. $275 trillion deep.

And as I've said, don't look at me, I don't have that kind of money.

From CNBC, January 25:

  • The transition to net-zero greenhouse emissions by 2050 will require an extra $3.5 trillion a year in capital spending on physical assets for energy and land-use systems , according to estimates from a new McKinsey report.
  • That amount is the equivalent of half of global corporate profits, one-quarter of total tax revenue, or 7% of household spending in 2020.
  • The report estimates the transition’s effects on demand, capital allocation, costs and jobs across sectors in 69 countries that produce about 85% of global emissions.

As the world grapples with a worsening climate change crisis, governments and companies are pledging to achieve net-zero greenhouse emissions by 2050 — a goal that will require an extra $3.5 trillion a year in capital spending, according to estimates from a McKinsey & Company report released on Tuesday.

That amount is the equivalent of half of global corporate profits, one-quarter of total tax revenue, or 7% of household spending in 2020.

“The net-zero transition will amount to a massive economic transformation,” said Mekala Krishnan, a partner at the McKinsey Global Institute and the lead author of the report.

The report estimates the transition’s effects on demand, capital allocation, costs and jobs across sectors in 69 countries that produce about 85% of global emissions.

Capital spending on physical assets for energy and land-use systems during the transition will amount to roughly $275 trillion, or $9.2 trillion each year on average, the report said. That’s $3.5 trillion more than the amount being spent on those assets annually today.

The report said an additional $1 trillion of today’s annual spending must be reallocated from high-emissions to low-emissions assets in order to achieve a net-zero transition. It also urged businesses, governments and institutions to prepare for uncertainty during the transition and warned stakeholders to accelerate efforts to decarbonize and adapt to climate risk....

This actual cost of the transition is one of the reasons some very smart folks were calling bullshit on Sir Nicholas Stern and his eponymous Stern Review (662 page PDF) back in October 2006.

By choosing to use a deceitfully low discount rate he came up with a cost for the transition that was essentially "oh, maybe a couple bucks, so cheap you won't even notice."

It didn't matter what the critics and critiques said though, Stern got a promotion from the knighthood, so now he's  Baron Stern of Brentford, of Elsted in the County of West Sussex and of Wimbledon in the London Borough of Merton. Lord Stern to his friends.

He also got a vice-chairmanship at IDEAglobal, parent at carbon consultancy IDEAcarbon

Stern also has a comfy endowed chair at the LSE and is Chairman of the Grantham Research Institute on Climate Change and the Environment.

Some of the folks who weighed in on the Review and said he was playing fast and loose:

The intro to 2013's "...Price Distortions Lead to Shortages, Queues, Searching, Hoarding, and so Forth"

Long time readers will remember Professor Weitzman, along with Tol and Nordhaus, as one of the bigs of climate change economics. His paper "A Review of The Stern Review on the Economics of Climate Change" was one of the first to point out the goofy-ass discount rate [a technical term] that Sir (now Lord) Stern used.
While Weitzman's c.v. indicates difficulty keeping a job, bouncing from Yale to MIT to Harvard, some of his stuff is near-genius level.
Although Prof. Weitzman's self-reported current research interests are:

Environmental and Natural Resource Economics, Climate Change, Discounting, Economics of Catastrophes, Cost-Benefit Analysis, Comparison of Alternative Instruments for Controlling Pollution, Green Accounting, Economics of Biodiversity, Role of Uncertainty in Environmental Economics.

he has a very diverse body of work including the instant case:....

Here's Tol in a 2007 post: 


And Nordhaus who made some green heads explode when he was awarded the Nobel Prize in Economics: 

Generational Carbon Pricing: Professor Nordhaus and the Activists

We have dozens/hundreds more posts just on the economics of global warming, much less policy and business and science and regulation finance and....

Use the 'search blog' box if interested.

"Hedge fund short-sellers take aim at green energy stocks"

One of the reasons you haven't seen a lot of buy recs out of us lately. As one fellow puts it:

....“In a bear market, a company doesn’t trade at 60 times earnings just because it does something morally good,” said Barry Norris, chief investment officer at Argonaut Capital. “People will be a bit more hard-nosed about it.”....

Via the FT's natural resources editor:

Another snippet:

....But hedge funds in the US and UK have been buying the lowly valued shares of oil and gas companies discarded by investors focused on environmental, social and governance (ESG) factors.Betting against companies whose stories of helping the environment are stronger than their earnings, or against those that have exaggerated their ethical credentials, has also become increasingly attractive.....

If interested see also last night's "The Lack Of Prospects For ESG (at the moment)".

Batteries: "Britishvolt signs multimillion-pound partnership to rev up UK electric vehicle gigafactory plans"

From The Sunday Times (Londinium), January 24:

Charging onwards

A UK TECH firm’s ambition to produce 300,000 electric vehicle battery packs per year at a new “gigafactory” in Northumberland have been given a shot in the arm with the announcement that Britishvolt has signed a multimillion-pound partnership with the UK Battery Industrialisation Centre (UKBIC).

The UKBIC, which was founded last year in Coventry, is a government-funded battery manufacturing development facility, specialising in helping battery makers scale up their operations.

The two-year partnership with Britishvolt will see the two organisations combine to bring to market Britishvolt’s newly-developed energy-dense battery cells, which, it is hoped, will make the company a major player in a rapidly expanding industry.....

.... News of the partnership follows the announcement last week of a £100 million government investment in Britishvolt as it builds the UK’s first battery production gigafactory (a term coined in 2013 by Tesla boss Elon Musk, when describing massive battery production facilities) on the site of a former coal-fired power station in Cambois, Northumberland. The funding has been made available through the government’s Automotive Transformation Fund.

Private funding to the tune of £1.7 billion is also being made available to Britishvolt via its partnership with the investment fund Abrdn and will allow the company to complete the factory, works on which are already underway. The full project is expected to cost up to £3.8 billion.....


Investors Balk at Plan to Buy Coal Mines and Close Them

It's the most cost-effective way to sequester carbon short of expropriation.

Which tells us a lot of the Larry Fink's of the world are not really into the spending money to abate the release of the stuff.

Three aspects of the issue. First up, from Marginal Revolution, October 18, 2021:

Be Green: Buy a Coal Mine!

It’s time to reup the idea of buying coal mines and shuttering them. I wrote about this a few years ago based on Bard Harstad’s piece in the JPE and it came up again on twitter so I went looking for a coal mine to buy. Here’s a coal mine for sale in West Virginia for only $7.8 million! According to the ad, the mine produces 10,000 tons of coal monthly and has reserves of 8 million tons. Now here are some back of the envelope calculations.

(Warning: There may be errors since there are a lot of unit conversions. I invite someone with expertise in the industry to do a more serious analysis.)

Each ton of coal burned produces about 2.5 tons of carbon dioxide (you get more carbon dioxide since the carbon combines with oxygen). Sources: 2.86 short tons. 2.086 short tons.

It costs about $100 to sequester a ton of carbon dioxide for a long time.

Thus, 10,000 tons of coal burnt monthly produce 25,000 tons of carbon dioxide that it would cost $2.5 million a month to sequester. Or buying the mine pays for itself in reduced C02 emissions in about 3 months.

Ordinarily buying up the supply would increase supply elsewhere but coal mines are going out of business–thus no one is investing much in building new coal mines. The supply curve, therefore, is inelastic. In addition, you could buy up the right to mine in precisely those countries that are not committed to reducing coal mining. Indeed, you could buy the right to mine costly-to-exploit coal deposits–those deposits are cheap (since they are costly to exploit) and by taking them off the market you are making the supply curve even more inelastic so you aren’t encouraging much additional supply. Imagine, for example, that coal mining will be banned tomorrow. Thus, companies will be producing all-out today but that means you could reduce a lot of carbon emissions by buying the right to mine from the most expensive producers (who will sell cheap) and you won’t appreciably increase the incentive to mine. Indeed, on the margin, a higher price of energy might even do more to increase alternative sources of power like solar, especially if you buy thermal coal where there are lots of substitutes (there are fewer substitutes for coke coal.) See the Harstad paper and references in my earlier post....

....MORE, including some interesting comments from the cheap seats. 

Beautiful, two months later an opportunity arises. From the natural resources editor of the Financial Times, December 21:

However, three days earlier the Wall Street Journal had put the lie to all the nice words from the 'green' community:

Citigroup and its partners shelved an investment fund they said would put an end date on thermal-coal mines to lower carbon emissions....
Always remember, the less virtue, the more signaling.

Either Its A Climate Emergency Or Its Not: "Europe’s green deal needs to get round anti-mining roadblock"

Three stories via

From Reuters, December 16: "Europe’s green deal needs to get round anti-mining roadblock"

From Bloomberg, December 18: "The world wants more lithium but doesn’t want more mines"

From Reuters, December 22: "US faces tough choices in 2022 on mines for electric vehicle metals"

Capital Markets: "Federal Reserve and Bank of Canada Meet as Risk Appetites Stabilize"

From Marc to Market:

Overview: After a slow and mixed start in Asia, where Australia and India are on holiday, equity markets have turned higher. Europe's Stoxx 600 is up around 1.9% near midday in Europe, which if sustained would be the biggest gain of the year. US futures are snapping backing too, with the S&P 500 popping more than 1% and NASDAQ by 2%. The equity recovery is having little impact in the bond market, where the US 10-year yield is up a basis point or so to near 1.79% and European yields are slightly firmer. The risk-on sentiment is evident throughout the foreign exchange market as the Swiss franc and yen are underperforming and the Norwegian krone, and dollar-bloc are leading the advance. Emerging market currencies are mixed. While the South African rand tops the performers, Russia and Eastern European currencies are sporting modest declines. The JP Morgan Emerging Market Currency Index is paring yesterday's gain. Meanwhile, gold's rally may be stalling around $1850, a two-month high. March WTI is firm and has held above $85 a barrel and is pushing through $86. US natural gas is up around 5% to extend its rally for a fourth consecutive session, while Europe's benchmark (Dutch) is snapping a four-day rally with a 3% pullback. Iron ore extended its gains to the best level since August, and copper is firm in the middle of its recent range. The main interest today is on the equity performance after the volatility and the Fed and Bank of Canada meetings.

Asia Pacific
The IMF downgraded this year's forecast for global growth to 4.4% from 4.9% projected in October.
The virus, higher inflation, and high debt levels were key considerations. The new constraints on mobility are expected to weigh on Q1 activity but recover in Q2. Still, a reassessment of the world's two largest economies is at the heart of it. The combination of more aggressive Fed tightening and failure to pass the large (~$2.2 trillion) hard and soft infrastructure measures led to a sharp cut in the IMF's US growth forecast to 4% from a little over 5%. China's zero-Covid policy and travel restrictions, prompt the IMF to reduce its projected growth by 0.8% to 4%. 

Beijing has continued to harass Taiwan by sending warplanes into its Air Identification Zone, with nearly 40 planes earlier this week, which is the most this year. Trying to make rhyme or reason for the continued action, some point to the two US carrier strike groups in exercises in the South China Sea. On another front, reports suggest Lithuania is considering asking Taiwan to change the name of its de facto embassy. It had planned to break tradition and allow Taiwan's name to appear, rather than the more customary Taipei. China reacted as one would expect....


Tuesday, January 25, 2022

Unilever To Cut Thousands Of Managers To Speed Decisionmaking

From FoodDive, January 18 and 2$:

Report: Unilever to lay off thousands of managers 

UPDATE: January 24, 2022: Bloomberg reports that Unilever plans to cut thousands of management positions to speed its decisionmaking, citing unnamed people familiar with the issue.

The report comes after a tumultuous week for Unilever. After affirming in a filing with the U.S. Securities and Exchange Commission that the company's future strategic direction "lies in materially expanding its presence in Health, Beauty, and Hygiene," Unilever walked away from its $68 billion offer for GlaxoSmithKline's consumer healthcare business. Then, reports over the weekend indicated activist investor Nelson Peltz's Trian Fund Management LP had bought a stake in the company. The news both increased the company's stock price and led to the reports of potential layoffs....


UPDATE: "Villa Aurora: Rome property fails to sell for €471m at auction"

Following up on December's "Attention Art Fans: Large Caravaggio For Sale, Asking $552 Million".

From the BBC:

A villa in the Italian capital Rome housing the only mural by Caravaggio has failed to sell at auction.

Villa Aurora is at the centre of a legal battle between its current occupier, Texas-born Princess Rita Boncompagni Ludovisi, and her stepsons.

The villa, which had a starting price of €471m (£394m), was expected to become the most expensive property ever sold but attracted no bids.

Another attempt to sell it is expected in April, with the price cut by 20%.

The highlight of the six-storey villa's many treasures is the painting by the 16th and 17th Century artist Michelangelo Merisi, better known as Caravaggio....

....MUCH MORE, it's quite a story.

The Lack Of Prospects For ESG (at the moment)

Bill Smead, founder of Smead Capital interview at The (NZZ), January 10 i.e. before the recent rumpus as Jeremy Grantham calls it:

...Where else can you find investments with upside potential?

Compared to the oil price, stocks of energy companies are significantly lower than they have been in the past. That’s because of what I call the ESG discount: The enthusiasm people have for ESG. The massive amount of capital that’s been thrown at ESG friendly stocks is not dissimilar to the capital that has been thrown at profitless total addressable market stocks. But here’s the problem: There is no money to be made temporarily in buying into ESG companies because most of them are brand new companies. It’s just a giant «needle in a haystack» session. It always ends badly because nobody is good enough to find the right needles in the haystack. Thus, there is massive capital being wasted in a very careless and foolish manner.

What does that mean in terms of your investment strategy?

The ESG discount is available to be taken advantage of. Let me give you an example: The first ESG discount was on tobacco. In 1968, the U.S. government mandated that cigarette commercials be taken off the broadcast networks. Philip Morris could no longer run the Marlboro Man commercials on television. In the next forty years, adult smoking in the U.S. dropped from 40% to 20%, and the price of a package of cigarettes went from 20 cents to $5. At the same time, the taxes went from 5 cents to $2.50 a pack. Yet, Philip Morris was the best performing stock on the New York Stock Exchange from 1968 to 2008. That’s because when you’re going from getting 15 cents a pack to $2.50, you don’t care that you have half as many smokers.

So what does this have to do with the energy sector?

That’s where oil and gas stocks are right now. They are the tobacco stocks of the late sixties. Sure, it’s likely that there will be dramatically fewer carbon transportation vehicles on the road forty years from now. But it’s not likely that there will be less total need in the world for oil and gas since they are the least expensive sources of energy. In the U.S., if we didn’t have natural gas and combustion turbines for generating electricity, we would be up a creek without a paddle right now. Wind and solar are still a couple of decades away from reaching critical mass. It’s just simple math: Our investments are contrary believes in how long it’s going to take for the energy transition, and how incredibly attractive gasoline and natural gas are in comparison to renewable sources of energy.

However, stocks of oil and gas companies have already recovered significantly since the low in spring 2020.....


ESG is currently over-owned, oil & gas under-owned in light of the fact that 10 years of "stranded asset" talk (yes, it's been a decade) from the intro to a 2016 piece*:

Since 2012 when the Carbon Tracker Initiative came up with the idea as a pitch to keep hydrocarbons in the ground we've been kicking around in-house what, if any, effects the the carbon bubble/stranded assets arguments will have on price, and to this day don't have a clear-cut answer for patient reader.
Well, six years later we have a bit more clarity, oil companies have been putting money in shareholder's hands rather than in the ground, nothing dramatic, on a year to year basis but on a decadal scale it's hundreds of billions/trillions that didn't go into exploration.

As noted regarding this piece regarding oil & gas stocks: 

ECB: "Looking through higher energy prices? Monetary policy and the green transition"

....She pretty much lays it all out right there. As with European carbon, it appears that we have an upwardly moving market price created by rules and regs. If the above doesn't communicate what has been decided let's try....

*Here's 2014's "In His Latest Letter Jeremy Grantham Ramps Up The Carbon Bubble/Stranded Assets Argumentum":

We've been following the proponents of the Carbon Bubble argument since the term was first floated by the Carbon Tracker Initiative in March 2012.

Al Gore tried to frame it as analogous to the sub-prime bubble but no one is really listening to him. Mr. Grantham via his Grantham Research Institute is going with the unburnable carbon/stranded assets approach and is probably the most prestigious voice making the argument followed in rapidly descending order by Nick Lord Stern who Chairs the GRI; billionaire political activist Tom Steyer who is making full use of Citizens United and who recently hooked up with Michael Bloomberg (just named the U.N's climate change/cities envoy) and former Goldman honcho (and less powerfully, U.S. Treasury Secretary) Hank Paulson in their Risky Business initiative.

A related movement is divestment from fossil fuel producers by some public employee pension funds and demonstrations for same from college endowments. In the most famous instance Harvard said no.

The thesis hangs on the 2°C target that the EU adopted as their goal for maximum global warming.
I should probably do a post on that one of these days.

I hope I've left enough breadcrumbs for our journalist friends to, should they wish to, write the book (or at least this chapter) on the global warming story.....

 There are many more refs. Use the search blog box if interested.

Just Hear Me Out: "Would Nuclear Winter Cancel Out Global Warming?"

 From Hackaday, January 25:

Nuclear war was very much a front-of-mind issue during the fraught political climate of the Cold War era. Since then, atomic sabre rattling has been less frequent, though has never quite disappeared entirely.

Outside of the direct annihilation caused by nuclear war, however, is the threat of nuclear winter. The basic concept is simple: in the aftermath of a major nuclear war, the resulting atmospheric effects could lead to a rapid cooling in global temperatures.

Some say it couldn’t ever happen, while others – including Futurama – suggest with varying degrees of humor that it could help cancel out the effects of global warming. But what is the truth?

Hard data is isn’t really available, as thus far there have been  no large-scale nuclear wars for scientists to measure. Several studies have explored the concept of nuclear winter, however, and explored its potential effects.

How Does It Work, Anyway?

Hundreds of large firestorms triggered by nuclear weapons could loft soot into the upper atmosphere, serving as the causative mechanism of the “nuclear winter” theory. The nuclear aspect is only as an ignition source; any other cause of widespread firestorms could do the same. Image Credit: Public Domain, Jim Peaco

The basic concept of nuclear winter is simple. In a large nuclear conflict, where nuclear weapons are used in strategic strikes against urban and industrial areas, large-scale fires would rage out of control. These fires would then loft large amounts of black carbon soot into the upper reaches of the atmosphere. Once there, the smoke particles might then be lofted further up into the stratosphere as they absorb heat from the sun, up to a point where the particles are too high to be quickly “rained out” of the air by precipitation. These particles would then essentially shade the surface, creating a cooling effect.

Papers published as recently as 2007 suggests that a full-scale nuclear war between superpowers could cause a drop in global average temperatures by as much as 8 °C . If that doesn’t sound dramatic, to put it into perspective the average temperature was 5 °C lower during the last ice age 18,000 years ago.

Modelling from researchers on the topic suggests that the major knock on effect on agriculture would be crippling to humanity around the globe. Temperatures in critical growing regions in Ukraine and Iowa, for example, could see daily minimum temperatures reach below freezing for several years, making growing food crops near-impossible. Global famine would be the result.

This photo is often mistaken for being a shot of the mushroom cloud created by the nuclear bomb dropped on Hiroshima in 1945. However, it is in fact an image of the pyrocumulus cloud created in the firestorm that happened in the aftermath of the attack. Image credit: Public domain, US Military

Running simulations with newer climate models has continued to turn up similar results, even in recent studies. Those studies are run with similar base numbers that suggest an all-out nuclear war using up most of the stockpiles of major superpowers would loft around 150 teragrams of soot into the atmopshere. However, that value remains an assumption that has drawn criticism from some sectors.....


John Hussman On Expected Future Returns

A deeply important subject that hasn't really mattered much over the last decade, or as Mr. Hussman phrases it:

"Put simply, by relentlessly depriving investors of risk-free return, the Federal Reserve has spawned 
an all-asset speculative bubble that we estimate will provide investors little but return-free risk."

From Hussman Funds, January 14: 

Return-Free Risk

The main adaptation that deranged Federal Reserve policy required of our own discipline in this cycle was to abandon our pre-emptive bearish response to historically-reliable ‘limits’ to speculation, and to instead prioritize the condition of market internals (which have been part of our discipline since 1988). Essentially, we became content to gauge the presence or absence of speculation or risk-aversion, without assuming that there remains any well-defined limit to either. A more recent – though minor – adaptation has been to adopt a slightly more ‘permissive’ threshold in our gauge of market internals when interest rates are near zero and certain measures of risk-aversion are well-behaved. The main effect is to promote a more constructive shift following material market losses.

The question isn’t whether one should adapt to unprecedented Fed policies, but instead, the form those adaptations should take. We are fully convinced that these historic valuation extremes have removed decades of investment returns from the future, and strongly suspect that the Fed has amplified future downside risk as well. I believe investors have placed themselves in a position that is likely to be rewarded by a very long, interesting trip to nowhere over the coming 10-20 years. At worst, they may discover the hard way that a retreat merely to historically run-of-the-mill valuations really does imply a two-thirds loss in the S&P 500. Still, our research efforts in recent years have focused on adaptations that can allow us to better tolerate and even thrive in a world where valuations might never again retreat to their historical norms. We don’t actually expect that sort of world, but have allowed for it.

– John P. Hussman, Ph.D., Maladaptive Beliefs, September 2021

In an economy where the Fed has lost every systematic tether to common sense, empirical evidence, and concern for financial stability, it’s worth beginning this first market comment of 2022 by recalling the ways we’ve adapted in order to navigate that environment. In a world where securities are regularly described on CNBC as “plays,” it’s clear is that the financial markets presently have little to do with “investment” – at least not by Benjamin Graham’s definition as “an operation that, upon thorough analysis, promises safety of principal and an adequate return.”

It may be true that zero interest rates provide investors “no alternative” but to speculate. But as Graham emphasized, there are many ways in which speculation can be unintelligent. The first of these is speculating when you think you are investing.

I cringe when I hear analysts talking as if any dividend yield above zero is “better” than zero interest rates. That argument relies entirely on ruling out even the smallest decline in price, and the smallest retreat from current valuation extremes. The dividend yield of the S&P 500 is just 1.3% here. It was lower only in the quarters surrounding the 2000 bubble peak. The run-of-the-mill historical norm is about 3.7%.

Those of you who are familiar with finance can prove to yourself that the effective “duration” of stocks (the weighted-average number of years needed for present value to be repaid by cash flows, and the sensitivity of the market price to changes in the discount rate) works out mathematically to be approximately the price/dividend multiple. From that perspective, one can think of the S&P 500 as being a 77-year duration investment here, compared with a historical norm closer to 27 years.

Depending on market conditions, stocks can have “investment merit,” “speculative merit,” both, or neither. In our own discipline, we gauge “investment merit” by valuation – the relationship between the price of a security and the long-term stream of expected cash flows that we expect that security to deliver over time. We gauge “speculative merit” based on the uniformity or divergence of market internals. When investors are inclined to speculate, they tend to be indiscriminate about it. Since 1998, our most reliable gauge of speculation versus risk-aversion has been based on the signal we extract from the market action of thousands of individual securities, industries, sectors, and security-types, including debt securities of varying creditworthiness.

The single difference between the most recent market cycle and other cycles across history is that in every other cycle, speculation always had a well-defined limit. We gauged those extremes based on what I describe as “overvalued, overbought, overbullish” syndromes. Unfortunately, zero interest rates have proved to be a kind of acid that burns through every shred of intellect, driving investors to imagine that any asset that varies in price – regardless of how extreme its valuation or how uncertain its underlying cash flows – is better than zero-interest cash. My error in this cycle was to believe that speculation still had well-defined limits. In late-2017, I abandoned that view, and became content to gauge speculation versus risk-aversion based on the condition of market internals. Since then, we’ve refrained from adopting or amplifying a bearish outlook when our measures of internals are constructive, regardless of how extreme valuations might be....


Put another way:

"I have two problems but only one tool."
-Ben Bernanke
Testimony to the House Budget Committee
Jan. 16, 2008

From Climateer "Quote of the Day" Federal Reserve Edition

From Central Banks to "Flood" Markets with Liquidity

Mark Zuckerberg Says Meta Will Have The World's Fastest AI Supercomputer (FB; NVDA)

From PC Magazine, January 25:
Meta Says It's Building the 'World's Fastest' Supercomputer
The AI Research SuperCluster (RSC) is expected to be ready by mid-2022.

Facebook parent company Meta this week announced work on what it believes is already "among the fastest AI supercomputers running today."

Once completed later this year, the AI Research SuperCluster (RSC) will be the fastest in the world, according to the company.

Boasting 6,080 graphics processing units in 760 Nvidia A100 modules, RSC is comparable to the Perlmutter supercomputer, which, as CNET noted, uses more than 6,000 of the same Nvidia GPUs and currently ranks as the world's fifth fastest supercomputer.

RSC acts as an amplifier for Meta's "next generation" of artificial intelligence, which will learn from trillions of examples; work across hundreds of languages; analyze text, images, and video together; develop new augmented reality tools, and carry out a host of other advanced tasks requiring super computer-levels of performance. "Ultimately, the work done with RSC will pave the way toward building technologies for the next major computing platform—the metaverse, where AI-driven applications and products will play an important role," the Meta AI blog explains....


Seven of the world's ten fastest supercomputers are using NVDA GPUs as accelerators. 

Here are our posts on this development over the years

"The world’s largest vertical farm will have a secret ingredient: fish"

From Fast Company, January 18:

Fish fertilize the plants—and then become another income stream. 

A sprawling new building that will soon be constructed in Luzerne County, Pennsylvania—at 250,000 square feet, roughly the size of two entire city blocks in Manhattan—will be the largest vertical farm in the world when it’s completed in 2023. Inside, though, you won’t find just vegetables: Tanks full of fish will sit near vertical stacks of trays filled with certified organic microgreens.

In the vertical farming industry, which is raising billions from investors, many startups grow greens like spinach or bok choy inside carefully-managed indoor spaces, and then selling the fresh produce to local consumers. But Brooklyn-based company Upward Farms is unusual in its use of fish, a version of a centuries-old practice called aquaponics. While others use synthetic fertilizer in their growing systems, the company uses fish waste that it filters out of tanks to provide nutrients to its plants. Both the fish and greens are then sold for food....



Meanwhile In Sweden: Aquaponics Startup Plans To Grow Salmon, Cucumbers, Herbs and Tomatoes At Supermarkets

Capital Markets: "Investors Fear Market Meltdown"

From Marc to Market:

Overview: The stunning upside reversal in US stocks was not sustained. The NASDAQ futures are off around 1.7% and the S&P 500 futures are nearly 1.2% lower. Asian equities were hit hard, with China, Korea, and Australia off more than 2%. Singapore unexpectedly tightened monetary policy (through the exchange rate) and the local stocks were off 1.3%. Europe's Stoxx 600 is up about 0.7%, led by energy and financials. Bond markets are drawing little support. The US 10-year yield is up to almost 1.79% after testing 1.70% yesterday. European yields are mostly 2-4 bp higher, and the periphery is holding in better than the core. The dollar is firm, though the Australian and Canadian dollars are the most resilient. Among emerging market currencies, the Russian rouble is a little higher after the central bank indicated yesterday it would hold off its forex operations tied to managing its oil proceeds that involves buying foreign currencies. The Singapore dollar has also edged higher. The Chinese yuan ticked up even though bonds and stocks weakened. The JP Morgan Emerging Market Currency Index is off for the third day, the longest losing streak this year. Gold is slipping lower in the European morning. March WTI is trading firmly and is around $84 after falling more than 2% yesterday. US natural gas is off around 2.4% after rallying almost 6% in the past two sessions. European natgas is slightly lower, and is consolidating near the three-day 25% surge. Iron ore has fully recouped yesterday's 3% decline and copper has steadied after falling almost 4% in the past two sessions.

Asia Pacific
Australia's Q4 CPI was higher than expected.
The key take away is to boost the market's confidence that the central bank will have to capitulate and raise rates considerably earlier than it has indicated. The Reserve Bank of Australia meets early next week. The market has moved to discount a greater likelihood a June move. The quarterly pace of inflation rose to 1.3% from 0.8% and lifted the year-over-year rate to 2.6% from 2.1%. The median forecast (Bloomberg survey) was for a 2.3% annual pace. The underlying measures also rose more than expected.

The Monetary Authority of Singapore, which uses the exchange rate as its main monetary policy tool, unexpected (between meetings) raised the path slightly of the Singapore dollar. The currency adjustment was in response to the one percentage point increase it is headline and core CPI projections. This is seen as a preemptive move, consistent with its move last October. South Korea's growth accelerated to 1.1% in Q4 from 0.3% in Q3. It was boosted by both exports and consumption (shades of "dual circulation?). The year-over-year pace edged up to 4.1% from 4.0%. 29. The central bank hiked its policy rate 25 bp last month to 1.25%. It hikes twice last year, and the swaps market has 75 bp of tightening discount this year.....

....Even without a bid from its asset markets, the Chinese yuan edged higher. It is the fifth consecutive advance. To put the yuan’s move this year in perspective, consider it has only fallen against the dollar in four sessions so far. Against its trade-weighted basket, the yuan appears to be at a record high.... 


Monday, January 24, 2022

Merlot: "How Paul Giamatti broke the California wine industry" (plus one of the greatest wine collections in the world. [and baboons])

France has some good Merlot.
(see after the jump)

From The Why Axis:

New data on the Sideways effect

The movie Sideways, a comedy about a neurotic novelist on a soul-searching trip through California’s wine country, became a bit of a sensation among a certain class of Americans in 2005. It took in over $100 million at the box office and won a whole bunch of awards. It’s best remembered today for an iconic scene in which Paul Giamatti’s main character goes on a brief expletive-ridden tirade against Merlot right before a high-stakes dinner date.
These roughly five or six seconds of dialogue had a profound effect on popular perceptions of Merlot and, in turn, on the entire California wine industry. According to a new study published in the Journal of Wine Economics (no, I did not make that up), in the years following Sideways’ release the price of Merlot fell and California wineries converted thousands of acres of Merlot grapes into the varietal preferred by Giamatti’s character in the film: Pinot Noir....


In 2010 we posted "Vineyard-Raiding Baboons Favor Pinot Noir":

What a bunch of wine snob poseurs.
Merlot is just fine, especially if it's dolled up as Chateau Petrus.
Berry Bros. & Rudd is running a special case price, "Buy 6 and save £ 2667.37".
A Romanée Conti (pinot noir) will cost you double or triple. BB&R is price on request.
Either way, possibly more than the average baboon has in petty cash....

From The Big Money's Daily Bread blog:

Wild baboons in South Africa are raiding vineyards. Perhaps they watched the move Sideways or perhaps they just have good taste: Growers report that the baboons favor pinot noir grapes. Not only that, but they "choose the nicest bunches" and leave the sour grapes on the ground, according to one farmer quoted by the Associated Press.

The primates' discernment is expensive for the growers in South Africa's wine country: Pinot sells for more than the merlot and cabernet sauvignon that the tasteful baboons tend to ignore....

Well, compared to the gentleman in this next post I rank somewhere in the vineyard raiding baboon category: 

One Of The Greatest Wine Collections In The World "Hidden Under a Chicken Coop: The “Louvre” of Wine"


 From Messy Nessy Chic, April 2, 2021:

One of the world’s most prestigious wine cellars isn’t where you think it might be. It isn’t nestled beneath a grand chateau or presidential palace, but buried in the backyard of an average Joe, a retiree of humble background who has been collecting the rarest wines, bottle by bottle for the past 50 years. 

© Michel-Jack Chasseuil


Wow oh Wow oh Wow.

Platts' "Commodity Tracker: 5 charts to watch this week"

 From S&P Global Platts, January 24:

Our editors and analysts are keeping an eye on current oil prices and supply factors, as well as the global spare capacity over the next few months. Methanol and tin prices are also in focus, while container premiums are hitting the ceiling.

1. Geopolitical supply risks return to the fore in oil markets

Platts Commodity Tracker: Geopolitical risks return to the fore in oil markets

What's happening? Recent oil supply disruptions include pipeline shutdowns in Ecuador affecting 270,000 b/d in December, the shutdown of 350,000 b/d from Western Libyan oilfields for three weeks through Jan. 10, and public unrest in Kazakhstan reducing January crude supply by an estimated 50,000 b/d. In addition, a deadly Jan. 16 drone attack in the UAE raises alarm in one of the only remaining sources of notable spare capacity, while odds for an Iran nuclear deal are diminishing and a potential Russian military incursion into Ukraine keeps markets on edge and risks Western energy sanctions.

Interactive: Platts Oil Security Sentinel

What's next? Oil markets currently possess sufficient spare capacity to offset sporadic outages. However, this OPEC+ buffer will fall to 1.8 million b/d by June, just as oil demand is set to grow by 3.5 million b/d in H2 over H1. Additional oil supply could potentially come from an Iran nuclear deal, although these prospects look uncertain at best, while shale activity is restrained by capital discipline relative to prior cycles. In the event that disruptions become an increased reality, then higher prices and demand destruction become the necessary balancing mechanism....


"How France's Largest Semiconductor Company Got Nationalized in Plain Sight"

From Fabricated Knowledge:

A power struggle was actually China encroaching on France's Largest Company. [?] France decided to nationalize instead. 

TLDR: China owned a 10.93% stake in Soitec and could have pushed to control it, but instead France just nationalized the company. In a series of power plays, the French board installed a CEO who best reflected National Interests. Management got blindsided. 

Soitec is a semiconductor materials company known for its smart cut and Silicon on Insulator (SOI) technologies, which are critical in 5G, Silicon Photonics, and Silicon Carbide (EV) end-markets.

Yesterday, they announced that current CEO Paul Boudre will retire and be replaced by Pierre Barnabé in July of 2022. Barnabé is currently an SVP at Atos, a French IT consulting company. This seemingly routine CEO transition sank company shares by over 15%. It’s not what it seems. 

First, the entire existing management team is opposed. The management team sent a letter to the board that does not mince words. Translated to English, it reads:

Soitec's Management Committee deplores the takeover of Soitec by the Chairman of the Board of Directors for 3 years, which culminates today with the incomprehensible appointment of a new CEO.

What exactly is happening at Soitec? Well first let’s just start with the current story of the now outgoing CEO, Paul Boudre.

The Story of Soitec (and Paul Boudre)

Soitec, like most firms, was no overnight success. This timeline of the companies history is the best place to start. Soitec originally pursued other markets but failed to gain traction. In 2015, the company Soitec shuttered its solar business as part of a hard pivot away from its existing failures....


I'm pretty sure Total is France's largest company by revenues and LVMH is the largest by market cap.

HT: FT Alphaville's Further Reading post which went with the teaser:

How France’s largest semiconductor company got stolen in plain sight

"Russian stocks sink 8%, ruble plunges to 14-month low as conflict fears intensify"

From CNBC:
  • Russian assets have been mired in volatility in recent weeks after a build-up of around 100,000 Russian troops along the Ukrainian border sparked fears from Western powers that Moscow was planning an invasion, an allegation the Kremlin has persistently denied.
  • Anders Aslund, senior fellow at the Atlantic Council and chairman of the International Advisory Council at the Center for Social and Economic Research, tweeted Friday that Russian assets could fall further.

The stand-off between Russia and the West over Ukraine sent Russian assets tumbling on Monday.

As of Monday afternoon in Europe, the MOEX Russia Index had dropped around 5.9% and is now down more than 15% year-to-date. The Russian RTS Index was down 8.1% on the day and around 19% lower so far in 2022....

Possibly related:
"Atlantic Council [!] Scholars Made Millions Lobbying for Putin-Backed Pipeline"

"First large-scale study links stock market volatility to mental disorders"

And a little stock shall lead them.

As noted earlier the small-caps were showing relative strength versus the other indices and are now actually up 1.33%.

A repost from the OUP via PsyPost:

Falling stock prices lead to increased hospitalisations for mental disorders, according to new research published today in the journal Health Policy and Planning.

Researchers assessed the relationship between stock price movements and mental disorders using data on daily hospitalisations for mental disorders in Taiwan over 4,000 days between 1998 and 2009. They found that a 1000-point fall in the Taiwan Stock Exchange Capitalisation Weighted Stock Index (TAIEX) coincided with a 4.71% daily increase in hospitalisations for mental disorders.

A downward daily change in stock price index coincided with significantly increased hospitalisations for mental disorders – when the stock price index decreased by 1% in a single day there was a 0.36% increase in hospitalisations for mental disorders on that same day. The researchers also found that falls in stock price index on consecutive days were associated with a 0.32% daily increase in mental disorders hospitalisations – when the stock price index falls consecutively for 5 days there was a 1.6% increase in the number of mental disorder hospitalisations on the fifth day....MORE
See also:
Attention Commodities Speculators: Hoarding is Now a Stand-alone Mental Disorder
"When the U.K. Tried Economists for Spreading 'Mental Fog"'
Was BP Chairman Carl-Henric Svanberg Abducted by Aliens? (BP)
When Economists Attack: Understanding the Passive-Agressive Personality Disorder
British Psychologists Bashing British Psychiatrists
The new Diagnostic and Statistical Manual of Mental Disorders V probably considers disagreement with the High Priests to be a disease disorder.

Shaman               Witch Doctor
Psychologist            Psychiatrist

From The Guardian:
Psychiatrists under fire in mental health battle
British Psychological Society to launch attack on rival profession, casting doubt on biomedical model of mental illness...

California’s High-Speed Rail Went From a $33 Billion Project to the Single Largest Public Infrastructure Disaster in U.S. History

We've been following this one for a while, some links below.

From Tech Startups, January 21:

California’s $100 Billion High-Speed Rail Boondoggle Project: How California’s High-Speed Rail Went From a $33 Billion Project to Become the Single Largest Public Infrastructure Disaster in U.S. History

With all the talk about using electric cars to reduce our dependence on fossil fuels, one mode of transportation that has received less coverage is high-speed rail. Many transportation experts agree that high-speed rail is a better environmental alternative than automobile or even air travel.

While airplanes are an efficient form of transportation, their environmental impact is undeniable. For example, an airplane can carry 175 passengers at one time, but a high-speed train like Japan’s Bullet Train can carry up to 1,300 people, making it a much more efficient form of transportation.

In fact, European countries, Japan, and recently China, have used high-speed rail as a method of transportation for decades to transport millions of people and reduce greenhouse gas emissions. High-speed rail systems are becoming more popular around the globe.

For example, Japan Bullet Train (known in Japan as Shinkansen) has been in operation for  58 years. During that period, Japan’s high-speed maglev train system has carried over 10 billion passengers and has never seen a single passenger injury or fatality in its history.

It’s an impressive feat considering that the train travels at speeds of up to 200 mph across a total of 1,717 miles of tracks. Japan Bullet Train is known for its on-time arrival and departure, comfort (relatively silent cars with spacious, always forward-facing seats), safety, and efficiency.

In recent years, however, China has taken the crown of the best high-speed train in the world. The country now boasts the world’s longest high-speed railway network with a total distance of 23,550 miles (37,900 km) as of the end of 2020, about 26 percent of the country’s total railway network. China’s High-Speed Rail (HSR) network covers newly built rail lines with a design speed of 120–220 mph.

While China and Japan may be the envy of the world, the United States is one of the few developed countries with no high-speed rail system. The fastest rail system in the United States is the Amtrak Acela Express along the Northeast Corridor (NEC), with max speeds of up to 150 miles per hour but with averages around 66 mph.

So, it’s no surprise that the US state with the largest economy, California, decided to embark on the country’s first multi-billion dollar high-speed rail project perhaps the most ambitious high-speed rail project in modern US history.

The project started all the way back in 2008 with an initial price tag of $33 billion. The project promised to take passengers across the 400-mile journey from San Francisco to Los Angeles in less than three hours at a speed of about 220mph by 2033, a dream that would take more than six hours by car. Today,  California’s high-speed rail project was perhaps the single largest and most embarrassing public infrastructure disaster in US history....


Here are a couple posts from 2011:

"California High-speed Rail Costs Triple to $100 Billion (and it will be arriving late)   

California High Speed Rail: The Man Who Predicted The Cost and the Delay

And some editorializing on the first bit of track to be laid: 

High Speed Rail: "Texas Central Railway intends to build a Houston-Dallas line with private money."

Of course the builders were able to pick and choose where they wanted to run their first line, unlike California which was forced by God to run their choo-choo from Bordon to Corcoran, a 65-mile stretch that will cost a minimum of double the $4.15 Billion estimate.
Borden to Corcoran?*
Okay, God had nothing to do with that routing of the West Coast disaster, that was all California High Speed Rail Authority.

Don't get me wrong, I'm all for high-speed rail, it's just that in the U.S., in every single instance the promoters have been lying scum.
Every single time.....

....Previously on the California Dreaming channel:
Mother Jones: "California High Speed Rail Now Even More Ridiculous Than Before"
Don't Argue Choo-choos With Reason: PolitiFact Gets High-Speed Rail Facts in Florida Wrong 
California High-speed Rail Costs Triple to $100 Billion (and it will be arriving late) 
California High Speed Rail: The Man Who Predicted The Cost and the Delay 
Jerry Brown Rejects $100 Billion Cost Estimate, Says Cap-and-trade Fees Will Fund High-speed Rail

And elsewhere:
China Considering Beijing-US High Speed Rail Line
*From the San Jose Mercury News 20Dec2010:

Logistics: 17,000 Union Employees Prepare To Strike Warren Buffett's BNSF Railroad

This has been coming for a couple weeks but now it appears talks have hit an impasse.

From the AP via NBC News Center Maine, January 24:

BNSF railroad tries to block 17,000 workers from striking

OMAHA, Neb. — BNSF railroad wants a federal judge to prevent two of its unions from going on strike next month over a new attendance policy that would penalize employees for missing work.

The Fort Worth, Texas-based railroad went to court after the Brotherhood of Locomotive Engineers and Trainmen, and the Transportation Division of the International Association of Sheet Metal, Air, Rail, and Transportation union both threatened to strike over the new policy that is set to go into effect on Feb. 1.

The unions said they are surveying their 17,000 members who work for BNSF to see if workers will support a strike.

The heads of the two unions, BLET National President Dennis Pierce and SMART-TD President Jeremy Ferguson, said in a joint statement that the new policy would violate their contracts with BNSF and could provide an incentive for workers to show up when they are sick in the middle of the coronavirus pandemic.

“This unprecedented BNSF policy repudiates direct and clear contract language, and in application, will attempt to force our members to report for duty without regard for their medical condition as we struggle to come out of a pandemic,” Pierce and Ferguson said.

The railroad maintains that this issue is a minor dispute that the unions wouldn't be allowed to strike over under federal law, and a strike shouldn't be allowed because it would hurt the economy too much....


Ummmm....Something's Up: Canadian Trucker's Convoy Being Greeted As Heroes

 If this is the Zeitgeist, governments are going to fall.

Saturday's "1000 Canadian Trucks On The Way To Ottawa To Protest The Cross-Border Vaccine Mandate" is going to prove to be a low estimate of the numbers. The trucks are coming from New Brunswick in the east to Vancouver in the west and Yellowknife up in the Northwest Territories. And the people are cheering them on.

This might be one of the preference cascades we were posting on in early November.