Wednesday, March 31, 2021

"Database reveals secrets of China's loans to developing nations, says study"

 From Reuters, March 31:

The terms of China’s loan deals with developing countries are unusually secretive and require borrowers to prioritise repayment of Chinese state-owned banks ahead of other creditors, a study of a cache of such contracts showed on Wednesday.

The dataset - compiled over three years by AidData, a U.S. research lab at the College of William & Mary - comprises 100 Chinese loan contracts with 24 low- and middle-income countries, a number of which are struggling under mounting debt burdens amid the economic fallout from the COVID-10 pandemic.

Much focus has turned to the role of China, which is the world’s biggest creditor, accounting for 65% of official bilateral debt worth hundreds of billions of dollars across Africa, Eastern Europe, Latin America and Asia.

“China is the world’s largest official creditor, but we lack basic facts about the terms and conditions of its lending,” the authors, including Anna Gelpern, a law professor at Georgetown University in the United States, wrote in their paper....


That's wonderful research but I'm still curious about the 12+ port deals China has done in Europe and whether those deals contain any secret protocols or annexes.

Recently: China's Debt Diplomacy: Kenya Says You Can't Sieze The Port of Mombasa In The Event Of A Default

Here Is Where We Have Problems mit Volkswagen

No, not the Voltswagen thing. That was dumb. and any journalist who failed to go to the US Patent and Trademark Office is dumber.

The USPTO makes it quite simple:

And it's not Dieselgate, though that gets closer to VW's playing fast and loose with the truth.

No, the problem we have  with the folks in Wolfsburg is this:

66 my ass.

I have it on pretty good authority that Dr. Porsche, pictured here left, pointing, designed/stole the designs/ had the vehicle designed in the 1930's:

On the other hand, Volkswagen no longer uses the Porsche or Piƫch families to personally do the marketing:

Golf GTI, "Time To Unpimp Ze Auto"


Now that guy I believe.

Planting Intentions Report: Where Did The Acres Go? (plus a caution for speculators)

CAUTION: It is very early in the 2021 Ag season and farmers have been known to read the news and decide they might just plant a bit more.

From AgWeb:

Where Did the Acres Go? A State-by-State Breakdown of USDA's Prospective Planting Results

USDA's Prospective Plantings report released Wednesday, March 31 shows farmers intend to plant more acres overall in 2021. However, the survey results for corn and soybean acreage came in lower than what the trade expected.  

Highlights of the first USDA farmer-based acreage survey of 2021 include: 

  • Corn: 91.1 million acres, up less than 1% from 2020
  • Soybeans: 87.6 million acres, up 5% from 2020
  • All wheat: 46.4 million acres, up 5% from 2020
  • All cotton: 12.0 million acres, down less than 1% from 2020


Also at AgWeb:

USDA Chief Economist Explains Surprises in March Acreage Report

USDA's Prospective Plantings Report released Wednesday threw some surprises to the market. And as a result, commodity prices exploded, with both corn and soybeans closing limit up on Wednesday. 

The first farmer survey-based report of the year shows farmers intend to plant 91.1 million acres of corn and 87.6 million acres of soybeans. Both of those results were below trade expectations. The report also indicated farmers intend to plant 12 million acres of cotton, and the all wheat acres number came in at 46.4 million. 

USDA chief economist Seth Meyer says leading into the report, the agency expected higher prices to incentivize farmers to plant more acres this year....


Seriously, regarding the caution, some of these "Aw shucks" good old boys have a couple masters degrees from Iowa State in the barn and play a high stakes game that makes the World Series of Poker look like Old Maid in comparison.  

UPDATED—ICYMI: "Corn, soybean markets hit ‘limit up’ on USDA’s lower-than-expected acreage"

Original post:

From Successful Farming:

Soybean market hits its 70¢ limit up mark Wednesday.

U.S. farmers will plant lower corn and soybean acreage than the trade expected, according to the USDA.

As a result, the CME Group’s corn market hit its daily limit up (25¢) trading prices. 

At the close, the May corn futures settled up its daily limit of 25¢ at $5.64 1/2.

July corn futures settled up its daily limit of 25¢ higher at $5.47 1/2.

New crop December corn futures closed up its daily limit of  25¢ at $4.77 1/2.

As a result, corn's daily trade limits will expand to 40¢ tomorrow.
May soybean futures finished up its daily limit of 70¢ at $14.36 1/2.

July soybean futures ended up its daily limit of 70¢ higher at $14.27 1/2.

New crop November soybean futures settled up its daily limit of 70¢ at $12.56 3/4.

As a result, the soybean market's daily limits will expand, tomorrow, too $1.05.

May wheat futures closed 16¢ higher at $6.18....


And more to come

We Are Returning AltEnergyStocks To The Blogroll

Tom Konrad's AltEnergyStocks blog was a dandy idea generator during the last go-round of clean/mean/green-tech. Because, of necessity, his universe of stocks are smaller-cap than we prefer we don't repost much on the individual names, instead focusing on trends and zeitgeist that those names might reveal.

Here are links to some of his recent posts:

Pop Goes the Clean Energy Stock Bubble

by Tom Konrad, Ph.D., CFA 2020 ended with a massive spike in clean energy stock prices.  From the end of October, election euphoria drove Invesco WilderHill Clean Energy ETF (PBW) from $63.32 to $136 at the close on February 9th, a 114% gain in 100 days.   Joe Biden is as strong a supporter of clean energy as Donald Trump was a supporter of big fossil fuel companies, but even with control of the presidency and both chambers of congress, there is a limit to what a president can do in a short time.  This is especially true when their top priority... 

10 Clean Energy Stocks: Returns Through February/ Poll

by Tom Konrad Ph.D., CFA I'm experimenting with how to display the returns of the 10 Clean Energy Stocks model portfolio.  My Patreon supporters seem fairly evenly split between the two options show below, so I'm opening the poll up to my broader readership. You can see the two most popular options below (with real return data through the end of February) and take the poll here. Comments are welcome as well. DISCLOSURE: Long all stocks in the model portfolio. 

Eneti and Brookfield Renewable Earnings

By Tom Konrad, Ph.D. CFA Here are a couple earnings notes I shared last week with my Patreon followers. Eneti, Inc. (NETI) - formerly Scorpio Bulkers (SALT) Eneti completed its name and ticker change on February 8th. New ticker is NETI (formerly Scorpio Bulkers (SALT), which I recently wrote about here. Highlights from February 2nd earnings report: 37 of the 47 vessels owned at the 3rd quarter have been sold or have completed sale agreements. Net asset value is $23.94/share. Since most assets are cash or vessels held for sale, this number is basically accurate. The stock is still a good buy... 
For folks playing along at home, the PBW manages to avoid many of the index construction/ETF construction problems you see in "ESG" funds, most notably that most ESG funds are actually just closet Nasdaq 100 trackers but with higher fees and slicker marketing.
Invesco WilderHill Clean Energy ETF (PBW)
98.19+3.94 (+4.18%) down from the $138.60 52-week high.
For what it's worth the PBW's all-time high was $144.20 on December 27, 2007
Finally, some thoughts on the backdrop to all this: 

Bread and Circuses The Modern Way: "Billionaires See VR as a Way to Avoid Radical Social Change"

 From Wired, February 15, 2021:

Tech oligarchs are encouraging the creation of virtual worlds as a cheap way to avoid problems in the real one.

The future of virtual reality is far more than just video games. Silicon Valley sees the creation of virtual worlds as the ultimate free-market solution to a political problem. In a world of increasing wealth inequality, environmental disaster, and political instability, why not sell everyone a device that whisks them away to a virtual world free of pain and suffering?

Tech billionaires aren’t shy about sharing this. “Some people read this the wrong way and react incorrectly to it. The promise of VR is to make the world you wanted. It is not possible, on Earth, to give everyone all that they would want. Not everyone can have Richard Branson’s private island,” Doom co-creator and former CTO of Oculus John Carmack told Joe Rogan during a 2020 interview. “People react negatively to any talk of economics, but it is resource allocation. You have to make decisions about where things go. Economically, you can deliver a lot more value to a lot of people in the virtual sense.”
Virtual reality is an attractive escape, but it’s not a solution to the world’s ills. The problems of the real world will persist beyond the borders of the metaverse created by companies such as Epic, Valve, and Facebook. Without decisive and radical action, our planet will continue to burn, the gap between the rich and poor will grow, and totalitarian political movements will flourish. All while some of us are plugged into a virtual world.
Worse, the virtual world will be one owned and controlled by the companies that create them. If you want a picture of the future, imagine a Facebook-branded set of VR goggles strapped to an emaciated human face—forever.
By the principle of the free market Silicon Valley lives and dies by, virtual reality is a loser. Only 1.7 percent of Steam users have a VR headset, according to a December 2020 hardware survey. And while it’s true that sales of headsets are up during the pandemic, roughly 30 percent in 2020 over 2019, video game sales in general are up overall.
Valve released Half-Life: Alyx in March 2020, just as the lockdowns were beginning. This was the first new Half-Life game in 13 years, the continuation of a franchise fans had been desperate to play for more than a decade. It sold well for a VR title, somewhere north of 2 million copies, but didn’t match the incredible numbers of 2020’s top-selling titles and was quickly forgotten by the mainstream press. Unless you’re really into VR, you probably weren’t talking about Half-Life in 2020. 
The reasons why are obvious. First, virtual reality is expensive. At the high end, Valve’s premiere headset—the Valve Index—costs $1,000. On the cheaper end, Facebook’s Oculus Quest 2 is $299. To play Alyx, those headsets need to be wired to a high-end gaming PC. The price of these machines vary, but something that can handle VR will cost around $1,000. Once the machine is built and the headset hooked up, the player will need to carve out a dedicated physical space to play the game. Most games require a minimum of about 6.5 feet by 5 feet, but the more space you have the better.
VR requires an incredible amount of cash and free space to set up properly, and the headaches don’t stop there. Right now, it reminds me of the early days of computer gaming. It works most of the time, but I’ve spent hours tweaking settings, adjusting controls, and reconfiguring hardware in a desperate bid to achieve the optimal experience.
Cash, space, and time is no guarantee that you’ll enjoy VR games. Some people experience nausea and vertigo in virtual reality. Sometimes, you can overcome this by properly adjusting the hardware or slowly exposing yourself to the technology. Some people get their “VR legs” and adjust. Others never do. Setting aside VR sickness, the technology is incredibly inaccessible for differently-abled people. The industry made huge strides toward making video games accessible to a wide range of people in 2020, but virtual reality—with its bulky headsets and strange controllers—is simply impossible for some people to use.
But all these problems can be overcome. As Carmack mentioned in his Rogan interview, tech companies will drive down the cost of the headsets. “Moore's law may be crapping out in terms of absolute performance, but we've still got a lot of price-performance that we can drive out of these things,” he said. “We can have virtual reality devices that can get cheap enough that lots and lots of people will be able to have these.”
Carmack was explicit about the importance of tech companies pushing virtual reality. “Not everyone can have a mansion. Not everyone can have a home theater. These are things we can simulate, to some degree, in virtual reality. Now, the simulation is not as good as the real thing. If you are rich and you have your own home theater or mansion and private island, good for you ... you’re probably not the people that are going to benefit the most,” he said. “Most of the people in the world live in cramped quarters that are not what they would choose to be if they had unlimited resources.”
That’s absolutely true; most people in the world live in cramped quarters and would choose not to. But Carmack’s solution is to create a virtual world where people can escape. It’s a promise of the future where the living conditions are still cramped but people have accepted their material conditions and retreated into a fantasy world created by the tech companies....

"Chinese smartphone maker Xiaomi to invest $10 billion in making electric cars"

As we've seen in posts over the last five weeks, the Chinese already dominate the production of wind turbines, solar cells and panels, batteries* and more importantly battery materials supply chains.

There was a method to our madness. We wanted to see who—in addition to politicians and their cronies—who would profit from the U.S. infrastructure spending and the U.S. Green New Deal spending. There will be a lot of money making its way to China. As we noted in a slightly different context in February:

"Did you know that because money and political power are fungible you can launder your ill-gotten gains into political contributions and end up with squeaky clean political influence with no one the wiser? And then use that influence to earn 'clean' money? Well now you know."

That's how sophisticated money launderers do it. 

Now on to electric vehicles!

From Bloomberg via the Toronto Star:

Xiaomi Corp. plans to invest about $10 billion (all figures U.S.) over the next decade to manufacture electric cars, embarking on its biggest-ever overhaul to enter China’s booming EV market.

Billionaire co-founder Lei Jun will lead a new standalone division that will invest an initial 10 billion yuan ($1.5 billion) on smart vehicle manufacturing, the company said in an exchange filing.

The Chinese smartphone maker joins tech giants from Apple Inc. to Huawei Technologies Co. in targeting the vehicle industry, betting future cars will grow increasingly autonomous and connected. Depending on progress, Xiaomi could end up investing a total 100 billion yuan ($15 billion) in the project in as little as three years, taking external financing into account, a person familiar with the matter told Bloomberg News before the announcement. The company will contribute about 60 per cent of the envisioned sum and plans to raise the rest of the funds, said the person, who asked not be identified because the plans are private.

“We have a deep pocket for this project,” said Lei, also the chief executive officer, at an event in Beijing. “I’m fully aware of the risks of the car-making industry. I’m also aware the project will take at least three to five years with tens of billions of investment.”

Xiaomi doesn’t plan to invite outside investors to the project as the company aims to take full control of the car-making business, Lei said. “This will be the last startup project in my career.”

Xiaomi becomes the latest to pile into an already crowded arena, where an array of automakers from Tesla Inc. to local upstarts Nio Inc. and Xpeng Inc. are battling for a slice of the world’s biggest EV market. Search giant Baidu Inc. and Geely Automobile Holdings Ltd. are also said to be teaming up to build electric cars. EV sales in China may climb more than 50 per cent this year alone as consumers embrace cleaner automobiles and costs tumble, research firm Canalys estimates....


*The largest battery manufacture in the world is China's CATL. Followed by Panasonic. Back to China, BYD CO LTD, Then Korea's LG Chem and Samsung SD.

As far as individual plants, from Benchmark Minerals Intelligence via :CleanTechnica, September 24, 2020:

A lot of other companies have plans but this is the state of play right now.

"JPMorgan, Salesforce Join Growing List of Firms Dumping Office Space"

Short American cities.
The decay of the northern cities, NYC, Baltimore, Chicago, Minneapolis, Seattle, Portland, actually pretty much anything north of the 37th parallel, is one of those long-term trends that we talk about. If you get on the right side of them it makes the rest of the investing stuff easier.

From the Wall Street Journal, March 30:

Rise of remote work means demand for office space could be permanently lower for some companies

JPMorgan started marketing 700,000 square feet of office space in lower Manhattan earlier this year

JPMorgan Chase & Co., Salesforce. com Inc. and PricewaterhouseCoopers are among the major firms looking to unload big blocks of office space, the latest sign that remote work is hurting demand for this pillar of commercial real estate. 

Large companies typically sign office leases for a decade or longer, giving them few options for reducing their footprint beyond trying to sublease floors to other tenants. At the end of 2020, 137 million square feet of office space was available for sublease across the U.S., according to CBRE Group Inc. That is up 40% from a year earlier and the highest figure since 2003. 

While sublet space increases during every recession as struggling businesses look to cut costs, firms typically add office space when the economy picks up again. But this time many of the companies ditching real estate are doing well financially; they say they need less space because they plan for more employees to work at least part time from home even after the pandemic is over.

That raises the prospect that demand for office space could be permanently lower at some companies, much like the rise of e-commerce has been driving down demand and rents for street-level retail.

This flurry of subleasing activity is already causing fresh headaches for landlords. Office rents for more expensive space, including concessions, fell around 17% over the past year in New York and San Francisco and 13% nationwide, according to real-estate firm JLL. 

Sublease space usually comes with an additional 25% discount, said David Falk, president of the New York tri-state region at real-estate services firm Newmark. And since firms can sublease on short notice, rising sublease availability can serve as an early indicator of the true state of the office market.
The speed at which sublet availability has been rising is “astonishing,” said Phil Ryan, director of U.S. office research at JLL. 

Some companies are merely testing what they can get by subletting and may ultimately decide to keep their space, brokers say. But by adding to office supply when there are few takers, they are helping push down rents across cities and at times could compete for business with their own landlords. 

JPMorgan started marketing 700,000 square feet of office space in lower Manhattan earlier this year. That is the largest block of space available for sublease in Manhattan, according to real-estate services firm Savills Inc. 

PricewaterhouseCoopers and Yelp Inc. have also listed space in New York for sublease, brokers say....


Tuesday, March 30, 2021

Your Face Is Not Your Own

 From the New York Times Magazine, March 18:

When a secretive start-up scraped the internet to build a facial-recognition tool, it tested a legal and ethical limit — and blew the future of privacy in America wide open. 

In May 2019, an agent at the Department of Homeland Security received a trove of unsettling images. Found by Yahoo in a Syrian user’s account, the photos seemed to document the sexual abuse of a young girl. One showed a man with his head reclined on a pillow, gazing directly at the camera. The man appeared to be white, with brown hair and a goatee, but it was hard to really make him out; the photo was grainy, the angle a bit oblique. The agent sent the man’s face to child-crime investigators around the country in the hope that someone might recognize him.

When an investigator in New York saw the request, she ran the face through an unusual new facial-recognition app she had just started using, called Clearview AI. The team behind it had scraped the public web — social media, employment sites, YouTube, Venmo — to create a database with three billion images of people, along with links to the webpages from which the photos had come. This dwarfed the databases of other such products for law enforcement, which drew only on official photography like mug shots, driver’s licenses and passport pictures; with Clearview, it was effortless to go from a face to a Facebook account. 

The app turned up an odd hit: an Instagram photo of a heavily muscled Asian man and a female fitness model, posing on a red carpet at a bodybuilding expo in Las Vegas. The suspect was neither Asian nor a woman. But upon closer inspection, you could see a white man in the background, at the edge of the photo’s frame, standing behind the counter of a booth for a workout-supplements company. That was the match. On Instagram, his face would appear about half as big as your fingernail. The federal agent was astounded.

The agent contacted the supplements company and obtained the booth worker’s name: Andres Rafael Viola, who turned out to be an Argentine citizen living in Las Vegas. Another investigator found Viola’s Facebook account. His profile was public; browsing it, the investigator found photos of a room that matched one from the images, as well as pictures of the victim, a 7-year-old. Law-enforcement officers arrested Viola in June 2019. He later pleaded guilty to sexually assaulting a child and producing images of the abuse and was sentenced to 35 years in prison. (Viola’s lawyer did not respond to multiple requests for comment.) 

At the time, the use of Clearview in Viola’s case was not made public; I learned about it recently, through court documents, interviews with law-enforcement officials and a promotional PowerPoint presentation that Clearview made. The case represented the technology’s first use on a child-exploitation case by Homeland Security Investigations, or H.S.I., which is the investigative arm of Immigrations and Customs Enforcement. (Such crimes fall under the agency because, pre-internet, so much abuse material was being sent by mail internationally.) “It was an interesting first foray into our Clearview experience,” said Erin Burke, chief of H.S.I.’s Child Exploitation Investigations Unit. “There was no way we would have found that guy.”

Few outside law enforcement knew of Clearview’s existence back then. That was by design: The government often avoids tipping off would-be criminals to cutting-edge investigative techniques, and Clearview’s founders worried about the reaction to their product. Helping to catch sex abusers was clearly a worthy cause, but the company’s method of doing so — hoovering up the personal photos of millions of Americans — was unprecedented and shocking. Indeed, when the public found out about Clearview last year, in a New York Times article I wrote, an immense backlash ensued.

Facebook, LinkedIn, Venmo and Google sent cease-and-desist letters to the company, accusing it of violating their terms of service and demanding, to no avail, that it stop using their photos. BuzzFeed published a leaked list of Clearview users, which included not just law enforcement but major private organizations including Bank of America and the N.B.A. (Each says it only tested the technology and was never a client.) I discovered that the company had made the app available to investors, potential investors and business partners, including a billionaire who used it to identify his daughter’s date when the couple unexpectedly walked into a restaurant where he was dining.

Computers once performed facial recognition rather imprecisely, by identifying people’s facial features and measuring the distances among them — a crude method that did not reliably result in matches. But recently, the technology has improved significantly, because of advances in artificial intelligence. A.I. software can analyze countless photos of people’s faces and learn to make impressive predictions about which images are of the same person; the more faces it inspects, the better it gets. Clearview is deploying this approach using billions of photos from the public internet. By testing legal and ethical limits around the collection and use of those images, it has become the front-runner in the field.

After Clearview’s activities came to light, Senator Ed Markey of Massachusetts wrote to the company asking that it reveal its law-enforcement customers and give Americans a way to delete themselves from Clearview’s database. Officials in Canada, Britain, Australia and the European Union investigated the company. There were bans on police use of facial recognition in parts of the United States, including Boston and Minneapolis, and state legislatures imposed restrictions on it, with Washington and Massachusetts declaring that a judge must sign off before the police run a search.

In Illinois and Texas, companies already had to obtain consent from residents to use their “faceprint,” the unique pattern of their face, and after the Clearview revelations, Senators Bernie Sanders and Jeff Merkley proposed a version of Illinois’s law for the whole country. California has a privacy law giving citizens control over how their data is used, and some of the state’s residents invoked that provision to get Clearview to stop using their photos. (In March, California activists filed a lawsuit in state court.) Perhaps most significant, 10 class-action complaints were filed against Clearview around the United States for invasion of privacy, along with lawsuits from the A.C.L.U. and Vermont’s attorney general. “This is a company that got way out over its skis in an attempt to be the first with this business model,” Nathan Freed Wessler, one of the A.C.L.U. lawyers who filed the organization’s lawsuit, in Illinois state court, told me.

It seemed entirely possible that Clearview AI would be sued, legislated or shamed out of existence. But that didn’t happen....


News You Can Use: What To Do If You Meet A Polar Bear

The thing to remember is: polar bears are stone cold killers. It's what they do.

From the New York Post, August 29, 2020:

Get naked, and other advice to fend off a polar bear attack 

The other day, a polar bear killed a 38-year-old Dutch man who was camping in Norway’s remote Svalbard Islands.

Now, many of us wouldn’t consider camping in Svalbard, but more of us are going to islands. In the past five years, the area has had a spike in “arctic tourism” as we rush to see the polar bears and ice caps before they disappear forever.

Polar bear tours in places like Churchill, Canada, are kitted out with mobile viewing units that look like elongated tanks, but there are still many places where tourists and locals can — and do — accidentally come face-to-face with the bears that may look cuddly — but are deadly.

I have been to the Arctic four times — in Greenland and Canada — and each time the warning is the same: Stay away from bears. However, should you run into one, there are three things you can do to protect yourself.

  1. Mace. Three years ago, during a Vintage Air Rally across the Arctic, I visited the abandoned Air Force base Bluie East Two on Greenland’s rugged East Coast. While walking around, I had to carry bear spray, which is mace for bears. According to several Air Greenland pilots I talked to beforehand, the spray does work; however, when you spray you have to be close and upwind, otherwise “it doesn’t go so well.”
  2. Gun. Always carry a gun — or travel with someone who has a firearm. While no one wants to kill a polar bear, you might have to if you want to save your own life. Sick and desperate bears are the ones that often come close to humans. During the air rally, I spent the night in Kulusuk. The day after we left, a half-starved polar bear wandered into town and had to be shot at close range, to save several school children nearby.
  3. Get Naked. There is no way you can outrun a polar bear. But they are, according to word of mouth, easily distractible. “Polar bears are very curious,” Sarah Woodall, a tourism destination manager for Visit South Greenland told me during my first trip to the country in 2015. To that end, if you should come face-to-face with one, back away (slowly at first), while peeling off your clothes one item at a time. The bears are very curious so they should stop, sniff, and perhaps play with each item as they come across it, leaving you free to run somewhere across the Arctic buck naked. Until they catch up with you, of course. Or you die of exposure. Either way — what an experience!....

A couple weeks prior to this article the Post had some advice from the National Park Service on what to do if you meet the polar bear's terrestrial cousins [the polar bear is Ursus maritimus] the brown, grizzly or Kodiak bears.

READ: Please don’t run from bears or push your slower friends down in attempts of saving yourself,”
they began in an update posted on Wednesday.

Well there goes that strategy.

There's more but that was the advice from the National Park Service that sort of stuck out.

Bill Gates Did NOT Buy The $645 Million Hydrogen Powered Yacht

I remember seeing the story last summer at a couple of the shipping sites but decided to wait because it sounded a little 'off'. Now we see Japan's Yanmar is going ahead with their hydrogen propulsion system but there is no mention of a mega-yacht. More after the jump.

From the Daily Mail, February 8, 2020:

  • Bill Gates, 64, had been linked to the super yacht for his love of sailing and keen interest in green energy
  • In a statement, Sinot said claims the vessel's concept had been bought by Gates were 'factually incorrect' 
  • Aqua yacht is powered with liquid hydrogen stored in two tanks at -423F, meaning its only emission is water
  • Comes with space for 14 guests, a gym, yoga studio and massage parlour, and cascading pool on rear deck
  • Artist's impression of the boat along with a 10ft scale model were unveiled at the Monaco Yacht Show in 2019

The designers of the world's first hydrogen-fueled super yacht have denied the $645million vessel is going to Microsoft boss Bill Gates. 

The 370ft vessel, which only emits water, had been linked to Gates for his penchant for super yachts and his keen interest in technological solutions to climate change.

But Sinot, the designers of the concept ship, have since denied this is the case. 

The yacht, unveiled at the Monaco Yacht Show last year, comprises five decks complete with space for 14 guests, 31 crew members, a gym, yoga studio, beauty room, massage parlor and cascading pool on its rear deck.

But its most impressive feature is locked away in the hold - two 28-ton vacuum-sealed tanks that are cooled to -423F (-253C) and filled with liquid hydrogen which powers the ship....


Mr. Gates does have some hydrogen interests, most recently one of his groups (along with Bezos et al), Breakthrough Energy Ventures invested in what is basically a research project: "Gates Fund Backs HyPro For $1/kg Green Hydrogen".

 And as for Yanmar, from Offshore Energy Biz, March 26:

Yanmar tests maritime hydrogen fuel cell system

They're still working on it.

I would like to see Bill peering out of the owners cockpit but that's not going to happen.

Meanwhile On the U.S. - Mexican Border: Cartels Resort To Wristband System To Keep Track Of The People They Are Smuggling

 "Hey, blue wristband, see? I paid for a VIP all-access pass, what's this 'you're sending me to Montana' crap?"

From Borderland Beat (also on blogroll at right), March 26:

Mexican Cartels Use Wristband System to Bring Order to Business

A shoe is seen surrounded by wristbands discarded by asylum seeking migrants from Central America along the banks of the Rio Grande river where migrants entered the United States from Mexico, in Penitas, Texas, U.S. (source: Reuters)

A mass-migration surge along the U.S. southern border has so overwhelmed Mexican cartel-associated smugglers that they are requiring their customers to wear numbered, colored, and labeled wristbands to denote payment and help them manage their swelling human inventory.

"It's an inventory system," a U.S. Customs and Border Protection (CBP) official confirmed. "They're all over the place."

The plastic bands - red, blue, green, white - some labeled “arrivals” or “entries” in Spanish, are discarded after migrants cross the river on makeshift rafts, according to a Reuters witness. Their use has not been widely reported before.

Some migrants are trying to evade border agents, others are mostly Central American families or young children traveling without parents who turn themselves into officials, often to seek asylum....


And in other Montana news, the state's junior U.S. Senator said:

"There is a flood of Mexican meth, Mexican heroin, Mexican fentanyl. Twenty years ago in Montana, meth was homemade. It was homegrown. And you had purity levels less than 30 percent. Today the meth that is getting into Montana is Mexican cartel."

"Taiwan chip makers’ water supplies cut as drought threatens island’s reserves"

 A few weeks ago the government said they didn't think they would have to cut water to the fabs.

Via the South China Morning Post, March 25:

  • Authorities cut supply to companies in two major science parks by 15 per cent, with reservoirs in several parts of central Taiwan dangerously low 
  • Dry spell pressures government to ensure supply to water-intensive industries such as the island’s world-leading semiconductor manufacturing

Taiwan has stepped up its fight against its worst drought in decades, further reducing water supplies to areas including a key hub of semiconductor manufacturing in the central part of the island, in an effort to stop reserves from running dry.

The government issued its first red alert on water supply in six years on Wednesday, warning that reservoirs in several parts of central Taiwan were running dangerously low. Authorities will cut the water supply to companies in two major science parks in Taichung by 15 per cent, Economics Minister Wang Mei-hua said at a briefing in Taipei.

Water will also be cut to non-industrial users across Taichung and Miaoli County two days a week, Wang said. The measures will come into effect from April 6.

Taiwan Semiconductor Manufacturing Company (TSMC) and Micron Technology both have chip-making operations in Taichung, although Wang said the restrictions would not affect their production. TSMC’s headquarters further north in Hsinchu has been spared further restrictions for now.

TSMC plans to increase the amount of water it uses from tanker trucks but the new restrictions will not affect operations, according to an emailed statement. A Micron representative in Taiwan declined to comment, saying the company was in a quiet period.....

Chinese Steel Futures Trade At All-Time High

 From Trading Economics (also on blogroll at right):

Shanghai steel futures climbed to a record-high of 4,849 yuan a tonne ahead of a seasonal recovery in demand and uncertainty over supply after top steelmaking city Tangshan pledged to cut emissions by 50% during days of heavy pollution. Domestic demand is likely to be spur by strong construction and manufacturing activities over the coming peak season. China’s property and infrastructure investment surged 38.3% and 36.6%, respectively, in the first two months of 2021 as the economy consolidated its recovery from the coronavirus blow; and industrial profit surged 179%. Latest data from Worldsteel showed most regions reported a decline in crude steel output in February, led by North America (down 8.9%), the European Union (down 7.1%) and Africa (down 6.4%). On the other hand, China the world's largest steelmaker produced about 83 million tonnes in February 2021, up by 10.9% from February 2020.

EIA: "Less electricity was generated by coal than nuclear in the United States in 2020"

As we saw a couple weeks ago the U.S. is doing a world-leading job of de-carbonizing. However...

First up, from the EIA's Today in Energy (also on blogroll at right): 

U.S. coal and nuclear electricity generation

Source: U.S. Energy Information Administration, Electric Power Monthly and State Electricity Profiles
Note: The dotted gray line represents a counterfactual electricity generation calculation that assumes the coal fleet’s capacity factor remained constant at its 2008 level.

U.S. coal-fired electricity generated totaled 774 million megawatthours (MWh) in 2020, which is less than both natural gas-fired (1.6 billion MWh) and nuclear-powered generation (790 million MWh), according to the U.S. Energy Information Administration’s (EIA) Electric Power Monthly. Last year marked the first time that coal was not the largest or second-largest source of annual electricity generation in the United States since at least 1949. However, EIA expects U.S. coal-fired electricity generation to increase and for nuclear-powered electricity generation to decrease in both 2021 and 2022.

Coal-fired electricity generation in the United States has continued to decrease as coal-fired generating units have been retired or converted to use other fuels and as the remaining coal-fired generating units have been used less often. U.S. operating coal-fired electricity generation capacity measured 313 gigawatts (GW) in 2008. In that year, the earliest for which EIA’s State Electricity Profiles have capacity factor data, coal’s capacity factor was 72%. Capacity factors measure the actual generation output for a fleet of generators as a percentage of what those generators are capable of generating. By 2020, coal’s operating capacity had fallen to 223 GW, and the coal fleet’s capacity factor had fallen to 40%.

Nuclear-powered generation was relatively steady in the previous decade. Although several nuclear power plants were retired, that decline in capacity was partially offset by uprates at several plants and the addition of Watts Bar Unit 2 in Tennessee. U.S. nuclear power, with 97 GW of capacity in 2020, has less than half as much operating capacity as coal, but nuclear power plants are operated more intensively. Nuclear’s capacity factor in 2020 was 93%.

U.S. electricity generation by source
Source: U.S. Energy Information Administration, Short-Term Energy Outlook (STEO)

In the most recent Short-Term Energy Outlook, EIA expects U.S. coal-fired generation to increase and for nuclear-powered generation to decrease in both 2021 and 2022. EIA expects that increases in natural gas prices will make coal more competitive in the electric power sector. This expected increase in coal’s utilization more than offsets the upcoming retirement of 2.8 GW of coal capacity in 2021 and another 8.5 GW in 2022, according to planned changes reported to EIA by owners and developers and compiled in EIA’s Preliminary Monthly Electric Generator Inventory.

EIA expects nuclear-powered electricity generation to decrease because three nuclear plants (totaling 5.1 GW of capacity) plan to retire in 2021. Another plant, Michigan’s Palisades, plans to retire in 2022. One nuclear power plant, Vogtle, in Georgia, plans to add 1.1 GW of capacity in November 2021 and 1.1 GW in November 2022, based on information reported to EIA. ....

Emphasis ours. 

And the outro from March 22's "China's new coal power plant capacity in 2020 more than three times rest of world's":

China is also financing and building coal-fired power plants across Africa, a move reminiscent of their construction of  HFC-23 refrigerant plants.*

And from MishTalk at some numbers through 2019 i.e. not including the covid-19 related U.S. reductions of 2020, January 28, 2021:

CO2 Stats

  • Please note that the US reduced its carbon footprint from 6.13 billion tons in 2007 to 5.28 billion tons in 2019.

  • Meanwhile, China increased its footprint from 6.86 billion tons in 2007 to 10.17 billion tons in 2019.

  • In the same timeframe, global output rose from 31.29 billion tons to 36.44 billion tons.

  • In 2007, the US accounted for 19.6% of the total global carbon footprint.

  • In 2019, the US accounted for only 14.5% of the total global footprint.

The above stats are from Our World CO2 Emissions.

*From December 27, 2020's "Why Is China Placing Huge (Global) Bets On Coal?":

....For some reason I can't get HFC-23 out of my head. It's a refrigerant chemical that China used to rake in billions from the Kyoto treaty signatories (read German hausfraus).

HFC-23 is 12,000 times as potent a greenhouse gas as CO2.

They would build plants to make the stuff  (as a byproduct of HFC-22) and then offer to shut them down for Kyoto cash. Based on the estimated lifetime production of the plants. Best guess is they netted $6 billion after construction costs.

After a while (years) the carbon credit people caught on and then we saw China's reaction:

"China Threatens Massive Venting of Super Greenhouse Gases in Attempt to Extort Billions as UNFCCC Meeting Approaches" 

We aren't HFC-23 Johnnys-come-lately. From September 2007: 

China's Kyoto Scam = $Billions

No matter what the U.S. and Europe do, even taking Co2 emissions to zero, matters not at all as long as China is making nice words on the world stage and pumping out the carbon.

All that combination accomplishes is putting the Western economies at huge cost disadvantages, in effect borrowing money from China to buy Chinese wind turbines to raise Western electricity prices to levels that make manufacturing wind and solar in the West noncompetitive.

But maybe that's the whole point. 

Who knows?

"US Yields Push Higher, Lifting the Greenback Especially Against the Euro and Yen"

And friggin gold prices seem to be convex, not just in terms of real rates but in terms of the dollar as well. 
(gold goes up faster when real rates decline than it drops when real rates increase)

Today the implied nominal yield on 10-year futures is the highest its been in 14+ months and the dollar futures are the highest they've been in months, DXY 93.20, back to July 2020 prices, but is gold back to $1600? 

No. (not yet)

From Marc to Market:


The US 10-year yield is at new highs since January 2020, pressing above 1.77% and helping pull up global yields today. European benchmarks yields are up 4-5 bp, and the Antipodean yields jump 8-9 bp. The impact on equities has been minor, and the talk is still about the unwinding of Archegos Capital. Most large markets in the Asia Pacific region rose, with the notable exception of Australia. South Korea and New Zealand led the region. Europe's Dow Jones Stoxx 600 is at a new high in over a year, while US futures are mixed. The dollar has rallied above JPY110 for the first time since last March, and the euro has been pressed below $1.1735. Sterling and the dollar bloc are showing some resilience. Most emerging market currencies are lower. Turkey's Erdogan fired the deputy governor of the central bank (and replaced him with a former executive of Morgan Stanley), and the Turkish lira has approached last week's extreme. The Chinese yuan managed to eke out a small gain in the mainland markets. The JP Morgan Emerging Market Currency Index is off for a third session. After dropping nearly 1.2% yesterday, gold is off another 0.75% and below $1700 for the first time in three weeks. Oil prices initially extended yesterday's recovery, and May WTI rose to an eight-day high near $62.25 before retreating to almost $61.00. OPEC+ meets on April 1 and is not expected to alter its output, though Russia and Kazakhstan are thought to be pressing for increased quotas. US oil inventories are expected to have fallen last week for the first time in six weeks.

Asia Pacific
The Australian government let the JobKeeper program expire.
There seem to be compelling reasons. Australia lost about 378k full-time positions as the pandemic struck last year, and 358k have returned. The participation rate since last October has been 66.1% compared with 65.9% in December 2019. Yet, the unemployment rate, which was at 5.1% in February 2020, was at 5.8% in February 2021. Part of the improvement was flattered by the JobKeeper initiative, which had been extended twice. Reports suggest around 900k workers were still getting a wage subsidy as the program ended, and more than 10% will likely lose their jobs. The Reserve Bank is putting greater weight on the labor market in setting monetary policy, and this will likely be underscored at next week's (April 6) RBA meeting. The new six-month round of A$100 bln bond-buying program begins mid-April.

FTSE Russell confirmed yesterday that it would add Chinese bonds to its World Government Bond Index. The inclusion will begin at the end of October and gradually increase to 5.25%-weighting over the next three years. This period seems longer than many would have anticipated. It will be the sixth-largest component when finished. Broadly, this is how Chinese markets are becoming more integrated into the global capital markets: benchmark inclusion and the rise of passive investment. When it comes to equities, Americans are sensitive to companies tied to China's military, but bonds appear to be a different matter. Separately, FTSE Russell says it will consider adding India and Saudi Arabia to its emerging market bond index....


Monday, March 29, 2021

The IMF Is Thinking About Your Digital Footprint As A Credit Report

 First up the press release, December 17, 2020:

What is Really New in Fintech

.... Recent IMF and ECB staff research distinguishes two areas of financial innovation. One is information: new tools to collect and analyse data on customers, for example for determining creditworthiness. Another is communication: new approaches to customer relationships and the distribution of financial products. We argue that each dimension contains some transformative components.

New types of information

The most transformative information innovation is the increase in use of new types of data coming from the digital footprint of customers’ various online activities—mainly for credit-worthiness analysis.

Credit scoring using so-called hard information (income, employment time, assets and debts) is nothing new. Typically, the more data is available, the more accurate is the assessment. But this method has two problems. First, hard information tends to be “procyclical”: it boosts credit expansion in good times but exacerbates contraction during downturns.

The second and most complex problem is that certain kinds of people, like new entrepreneurs, innovators and many informal workers might not have enough hard data available. Even a well-paid expatriate moving to the United States can be caught in the conundrum of not getting a credit card for lack of credit record, and not having a credit record for lack of credit cards.

Fintech resolves the dilemma by tapping various nonfinancial data: the type of browser and hardware used to access the internet, the history of online searches and purchases. Recent research documents that, once powered by artificial intelligence and machine learning, these alternative data sources are often superior than traditional credit assessment methods, and can advance financial inclusion, by, for example, enabling more credit to informal workers and households and firms in rural areas....


Sounds pretty benign, advancing financial inclusion and all

And from the working paper (beginning on page 10 of the PDF:

Financial Intermediation and Technology:What’s Old, What’s New?

....New developments

Technological progress perpetuates the trend toward a greater use of hard information in finance, with both its benefits and drawbacks. As the volume of codified information increases, its use will expand from the current realm of standardized products such as mortgages into more complex business segments such as commercial lending and financial advisory services. While this will further increase efficiency and reduce costs, it can also amplify existing incentive problems or create new ones.

The use of non-financial data will have large effects on the provision of financial services. Traditionally, banks rely on the analysis of customer financial information from payment flows and accounting records. The rise of the internet permits the use of new types of non-financial customer data, such as browsing histories and onlines hopping behavior of individuals, or customer ratings for online vendors. 

The literature suggests that such non-financial data are valuable for financial decision making. Berg et al. (2019) show that easy-to-collect information such as the so-called “digital footprint” (email provider, mobile carrier, operating system, etc.) performs as well as traditional credit scores in assessing borrower risk. Moreover, there are complementarities between financial and non-financial data: combining credit scores and digital footprint further improves loan default predictions. Accordingly, the incorporation of non-financial data can lead to significant efficiency gains in financial intermediation.5

Large technology firms collect vast amounts of non-financial data through their consumer-facing platforms in the areas of e-commerce, social networking, and online search. The sheer amount of data enables the use of “big data” analysis tools such as artificial intelligence and machine learning. The literature confirms their usefulness in finance. For example, Dobbie et al. (2018) show that the use of machine learning can lead to significantly improved default risk predictions. 

Accordingly, Bigtech firms have the informational capacity to compete, and possibly even outperform banks in financial service provision. This is corroborated by Frost et al. (2019), who show that the internal ratings of MercadoLibre, an online marketplace in Latin America, predict default risk better than credit scores. There is evidence that Bigtech finance is most effective when traditional financial intermediation is undersupplied. Hau et al. (2019) document that Ant Financial, an arm of the Alibaba online marketplace, extends more credit lines in rural areas of China with a limited presence of banks.

Finally, the proliferation of the internet increases the overall availability of public information; large amounts of data can be acquired at low cost via web-scraping.....

....MUCH MORE (32 page PDF)

 Huh. I'm not seeing any of that inclusion lingo.

Another Big European VC Round: Italian Property Tech Startup Raises €200 million

It was just a few months ago I was commenting on how few high-eight and nine-figure rounds we were seeing in Europe and now it's six or seven in the last three months.

From EU-Startups:

Italian proptech startup Casavo lands €200 million to change the way people sell, live and buy homes in Europe

Casavo, a leading Italian proptech platform with the mission to change the way people sell, live and buy homes in Europe, announces a new capital raise of €200 million, bringing total capital raised to date to €385 million including debt and equity.

Founded in 2017 in Milan, Casavo has developed an innovative and unique business model: a technological platform called ‘Instant Buyer’ that submits direct offers to buy homes, and, after renovation, finds the final buyers. Founded by Giorgio Tinacci, Casavo aims to change the way people sell, live and buy homes in Europe. The company has handled more than 1100 real estate transactions to date for a total value in excess of €300 million. With a team of 200 people, Casavo is currently operating in Milan, Rome, Turin, Florence, Bologna, Verona, and Madrid. With its core being the Instant Buyer service, Casavo is further expanding its marketplace product offer to cover all the needs of sellers, buyers and brokers.

Casavo achieved triple-digit growth in 2020 as the company provides customers with a superior digital user experience, reducing the average time to sell a home from 6 months to less than 30 days, and benefitting all players in the real estate ecosystem....


Ha! A Paris-Based Startup Becomes A Unicorn
I mentioned last year* we weren't seeing mega rounds in European VC but that they did seem to be getting bigger.....

Reinsurance: Ever Given Incident Likely To Cause Large Loss Event For Industry—Fitch

From Artemis

Ever Given blocking of Suez canal adds further pressure for reinsurers: Fitch

....Fitch Ratings has warned that, “The blocking of the Suez Canal and resulting disruption to global shipping is likely to cause a large loss event for the reinsurance industry.”

Adding, “This event will reduce global reinsurers’ earnings but should not materially affect their credit proles, while prices for marine reinsurance will rise further as a consequence of the container ship ‘Ever Given’ grounding in the canal.”

While the end of the blockage appears imminent, Fitch still believes that enough damage has been done to result in a meaningful marine market loss event.

“The ultimate losses will depend on how long it takes the salvage company to free the container ship completely and when normal ship traffic can resume, but Fitch estimates losses may easily run into hundreds of millions of euros,” the rating agency explained.

Incidents that damage or sink large container ships can easily result in US $1 billion or more of property losses, but there are largely related to salvage Fitch said.

As it’s now hoped the Ever Given will be able to continue forwards and clear the canal, claims related to the hull and cargo insurance, including salvage, should remain well below the billion dollar mark, Fitch explained....


"The Moly Mystery. Why Is China Soaking Up The World’s Molybdenum?"

From Forbes, March 26:

Somewhere in China there is a warehouse stuffed to the ceiling with molybdenum, a tongue-twister metal which most people call moly and which has a number of interesting uses ranging from oil drilling pipe to the steel used in armaments.

Since the middle of last year, the price of moly has risen by more than 60% from around $7 a pound to $11.50/lb, down $1 on the peak of $12.50/lb reached earlier this month.

Not a widely-traded metal, nor one generally mined on its own, most moly is produced as a by-product of copper mining with the presence of moly in an orebody sometimes the difference between a mine being a profit (or loss) maker.

Last year, according to an analysis of the moly market by Macquarie, an Australian investment bank, the global market was over-supplied by around 45 million pounds thanks to a Covid caused drop in demand.

But this year the moly market is tipped to rebound with a deficit of 16 million pounds developing as demand outstrips supply.

The problem, which foxed the bank, is trying to understand the sudden shift in the market with the only explanation being that Chinese buyers were busy in the second half of last year soaking up the moly surplus and driving the price higher.

Massive Chinese Imports

“The big driver of the molybdenum price recovery last year was a massive rise in Chinese imports,” Macquarie said.

“Total net imports reached 100 million pounds, up from only 1.4m/lbs in 2019....


Platts' "Commodity Tracker: 6 charts to watch this week"

From S&P Global Platts, March 29: 

....5. EU gas storage refill could drive higher Russian pipe volumes, LNG imports

EU gas storage 2018-2020

What's happening? EU gas storage sites are now less than 30% full after a particularly heavy withdrawal season over the winter, with market players now preparing to switch to injection mode in a bid to replenish stocks. Estimates suggest 50% more gas will be needed this summer to build back stocks, which were critical in meeting the record-high demand triggered by cold weather in January and February.

What's next? The potential for strong injection demand could support prices as the market looks to refill storage facilities, while buyers will likely look to Russian pipeline volumes and LNG to provide the necessary supply. LNG, in particular, could be drawn to Europe as spot LNG prices have come down to the level of European gas prices in recent weeks....


Follow-Up: "Van Gogh painting, hidden for a century, sells for $15 million"

 From the New York Post, March 26:

It’s Van Gogh-ing … going … gone! 

For a cool $15.4 million, a newly unearthed Vincent Van Gogh masterpiece that was kept hidden by a French family for more than 100 years now has a new home. 

The pricey painting, titled “A Street Scene in Montmartre,” sold Thursday during an auction livestreamed from Paris. 

It trafficked exorbitantly high phone and online bids from art enthusiasts in the French capital, as well as in New York and Hong Kong.

Although Van Gogh’s freshly exhumed tour de force went for a little over $15 million, it initially fetched a staggering $16.47 million hammer offer. 

But auction house Sotheby’s experienced an unspecified glitch in its online bidding system that forced the vendors to redo the sale at the end of the event. The final — albeit lower — bid was accepted....


"An 1887 painting of Montmartre in Paris by Vincent Van Gogh is appearing on the market for the first time"
My first thought was "That's not Montmartre".
Then, "Oh" Things change....

Our three most popular posts on Van Gogh seem to have a common theme:
And many more, if interested.

"Carbon Capture and Storage: The Negative Carbon Option?"

We'll re-use the intro from January's "Elon Musk to offer $100 million prize for 'best' carbon capture tech":

Carbon capture is an approach the Norwegians among others are exploring but it is not easy. Because the concentrations of CO2 in air are so low, ~415 parts per million, you have to move a lot of air through your systems to get meaningful amounts of CO2 to sequester.

The other reasons are ideological. A lot of folks in the authoritarian crowd don't like it because it means that things don't have to change as much as they would like things to change. Wealth transferers don't like carbon capture because it directly attacks their rationalization for "climate reparations", always set with a starting point far enough back in time so that only Northern Hemisphere and in particular, western, countries owe x-number of trillions of dollars to southern and eastern countries. And then there are the....

Yeah, I've been doing this a long time.

Putting all that aside, prizes are good, a very efficient way to mobilize talent and creativity in a focused pursuit. I may even see if I can recruit a team of folks smarter than I to claim Elon's money.....

And from The Conversable Economist, March 18: 

here used to be one coal-fired electricity generating plant in the US using carbon capture and storage (CCS) technology, the Petra Nova plant outside of Houston, Texas. It's now been shut down. It's not that the plant was a roaring technology success; for example, the process for scrubbing out the carbon required so much energy that the company had to build a separate natural-gas power plant just for that purpose. Still, I was sorry to see it go. There are other US plants, not coal-fired, learning about carbon capture and storage. But the way to learn about new technologies is to use them at scale. 

Here, I'll take a look at the Global Status of CCS 2020 report from the Global CCS Institute (December 2020) and the Special Report on Carbon Capture Utilisation and Storage: CCUS in clean energy transitions from the International Energy Agency (September 2020). These reports make no effort to oversell carbon capture and storage. Instead, the argument is that in specific locations and for specific purposes, carbon capture and storage technology could be a useful or even a necessary part of reducing carbon emissions. 

Brad Page, chairman of the Global CCS Institute, notes: "Just considering the role for CCS implicit in the IPCC 1.5 Special Report, somewhere between 350 and 1200 gigatonnes of CO2 will need to be captured and stored this century. Currently, some 40 megatonnes of CO2 are captured and stored annually. This must increase at least 100-fold by 2050 to meet the scenarios laid out by the IPCC." Nicholas Stern adds: "We have long known that CCUS will be an essential technology for emissions reduction; its deployment across a wide range of sectors of the economy must now be accelerated."

The basic point here is that even if there can be an enormous jump in non-carbon energy production for most purposes, there are likely to remain a few uses where it is extremely costly to substitute away from fossil fuels. Common examples include the iron, steel, and concrete industries, as well as back-up power-generating facilities that are needed for stabilizing power grids. For those purposes, carbon capture and storage technology can keep the resulting emissions as low as possible. Carbon capture and storage might have a role to play in a shift to hydrogen technology: hydrogen generates electricity without carbon, but using coal or natural gas to make the hydrogen is not carbon free. Moreover, it would be useful to have at least a few energy technologies that are carbon-negative. Examples would include if it is possible to combine biofuels with carbon capture and storage technology, or perhaps even in certain locations to use a cheap but local noncarbon energy source (say, geothermal energy) to capture carbon from the air....


"US vertical farming group AeroFarms joins unicorn club, strikes SPAC deal to go public"

Now is the time we juxtapose.

I was idly flipping through back issues of Vertical Farm Daily and stopped at this headline:

“Vertical farms are not going to create venture level returns”

at the same time this from AgFunder dropped out of one of the feedreaders:

  • US vertical farming startup AeroFarms has agreed a merger with Spring Valley Acquisition Corp, a special purpose acquisition company (SPAC). The deal will see AeroFarms go public on New York’s NASDAQ exchange under the symbol ‘ARFM’.
  • The transaction could allow Newark-based AeroFarms to raise as much as $357 million in gross proceeds, including Spring Valley’s $232 million cash reserves plus $125 million to be secured via a private investment in public equity (PIPE) deal from institutional investors, AeroFarms executives, and Spring Valley sponsor Pearl Energy Investments.
  • The merger is expected to close in Q2 2021 with the combined company estimated to be valued at $1.2 billion.


When the deal closes AeroFarms will become the second publicly traded indoor farm following on the heels of AppHarvest.
From March 8's Vaclav Smil: "How Much Energy Does It Take to Grow a Tomato?":

....This type of analysis becomes more and more important as the SoftBanks and Jeff Bezos' of the world attempt to steer us toward food grown in greenhouses and vertical farms and we start seeing more headlines like this from Bloomberg last June: ""Pricey Greens From Indoor Farms Are Thriving in the Covid Era"" and this from February 3: "ICYMI: Indoor Farming Company AppHarvest Came Public Via SPAC (APPH)".

AppHarvest is not just any indoor farmer. Including the SPAC deal they have raised  close to a half-billion dollars to build the world's largest greenhouse. To grow tomatoes. 

Indoor Farning: AppHarvest Raises Another $28 Million To Fund World's Largest Greenhouse (and more)

For more on the centi-billionaire farmers:...

Capital Markets: "Markets Look for Direction after Large Block Trade[s] and Before Key Data"

 As mentioned in the post immediately below, uncertainty in the equity market is overshadowing any jubilation over the Ever Given being refloated.

From Marc to Market:

Overview: The large block trade (~$20 bln) before the weekend, apparently from a family office, continued to have ripple effects today, but the MSCI Asia Pacific Index barely noticed. It extended its pre-weekend rally of 1.3%, and only South Korea and Australia fell among the major markets. Europe's Dow Jones Stoxx 600 edged to new highs since last March but struggled to sustain the upside momentum. Financial and real estate sapped the strength that had been coming from consumer staples and information technology. US futures indices are nursing 0.3%-05% losses. The US 10-year yield is a little softer at 1.65%, while European yield benchmarks have edged slightly higher. The dollar is stronger against most currencies today. Sterling and the Australian dollar, among the majors, are showing a little resilience, while the Swedish krona is off around 0.6%. Emerging market currencies, except for a few from East Asia, are lower, led by the 0.7% fall of the Mexican peso, followed by around a 0.65% loss of the Turkish lira. The JP Morgan Emerging Market Currency Index is lower for the fifth time in the past six sessions. Gold is trading heavy, around $1725 near midday in Europe. It continues to trade within the $1719.30 and $1755.5 range set on March 18. Progress on moving the ship blocking the Suez Canal was reported, and oil prices softened after last week's choppy action ended with a 4.1% gain to almost $61. The May WTI contract found support a little below $59.50 and recovered more than a dollar in the European morning to approach $61.00 a barrel.

Asia Pacific
After announcing retaliatory sanctions on the EU and UK at the end of last week, Beijing announced over the weekend that it would sanction two Americans. The Chair and Vice-Chair of the US Commission on International Religious Freedom are now barred from visiting or doing business in China.
The Chair, incidentally, is the wife of Senator Manchin. Beijing also sanctioned a member of the Canadian parliament too. A few months ago, Nike and H&M expressed concern about forced last in Xinjiang's cotton industry, and last week faced consumer boycotts and backlash in China. Some H&M stores were shut by landlords, according to press reports. These are mainly symbolic moves and will not change the behavior on either side. Former US Secretary of State Kissinger has characterized the broader confrontation as the "foothills of a Cold War." This implies the likelihood of escalation. The Biden administration's invitation to Xi (and Putin) to a global climate change summit is a polite gesture. Still, any agreement requires, as Reagan instructed, trust but verification, both of which are obstacles, especially given the poisoned atmosphere.

Separately, but not totally unrelated, China's trade punishment of Australia is set to continue.
Beijing's temporary sanctions on Australian wine, in place for months, has formally been extended to five years. The tariff ranges from 116% to 218%. China was the largest buyer of Australian wine. China claims the wine was subsidized and dumped (sold below either the price in Australia or below "market value"). However, China has taken action on many commodities, including barley, coal, beef, and lobster. Australia has threatened to take the case to the WTO, but the Biden administration has continued to block appellate judges' appointments, which undermines the conflict resolution mechanism. Australia ran A$5.7 bln trade surplus with China in January, as Canberra reported a record trade surplus. February trade figures are due out later this week. Japan is the only G7 country not to sanction China. Still, pressure appears to be mounting ahead of Japan's Prime Minister Suga's expected trip to Washington to be the first foreign leader to visit President Biden, possibly as soon as April 9. ...

There are several moving parts of the vaccine rollout. The UK had secured favorable contracts but lacks the manufacturing capacity to produce sufficient vaccines. The EU has the manufacturing capacity but did not secure favorable contracts, and when they did, it appears they backed the wrong ones. The US has both the manufacturing capacity and favorable contracts. Indeed, the NY Times warned of a coming glut of vaccines in the US....