Archive for April, 2012

@theGreenParty talking ’bout my generation—and that green thing

April 28, 2012

I got this as a forwrded email and felt I had to share it.

It indicates where the real focus of green political attention should be.

Checking out at the store, the young cashier suggested to the older woman that she should bring her own shopping bags because plastic bags weren’t good for the environment.

The woman apologized and explained, “We didn’t have this green thing back in my earlier days.”

The cashier responded, “That’s our problem today. Your generation did not care enough to save our environment for future generations.”

She was right — our generation didn’t have the green thing in its day.

Back then, we returned milk bottles, cool drink bottles and beer bottles to the store. The store sent them back to the plant to be washed and sterilized and refilled, so it could use the same bottles over and over. So they really were recycled.

We refilled writing pens with ink instead of buying a new pen, and we replaced the razor blades in a razor instead of throwing away the whole razor just because the blade got dull. But we didn’t have the green thing back in our day.

We walked up stairs, because we didn’t have an escalator in every shop and office building.

We walked to the grocery store and didn’t climb into a 300-horsepower machine every time we had to go two blocks. But she was right. We didn’t have the green thing in our day.

Back then, we washed the baby’s nappies because we didn’t have the throw-away kind.

We dried clothes on a line, not in an energy gobbling machine burning up 220 volts — wind and solar power really did dry our clothes back in our early days.

Kids got hand-me-down clothes from their brothers or sisters, not always brand-new clothing. But that young lady is right. We didn’t have the green thing back in our day.

Q.I. Fry isn’t a Scientist

April 27, 2012

As much as I enjoy QI,(despite the witterings of Alan Davies), I do get irritated at times.

Knowing my penchant for some of the more arcane bits of knowledge thrown out in QI, my daughter bought Stephen Fry’s “The book of The Dead” for me, as a Xmas present. I’ve only just got around to reading it (and enjoying most of it) but I was brought up sharp by a footnote, on page 4, a bout the production of Quicklime. “The dust could cause blindness or spontaneously combust, producing hideous burns.”

For someone, who trots out Scientific facts, as though he is an authority on such matters, this is as bad as an English Graduate saying “should of”, unless he has a different concept of Combustion (spontaneous, or otherwise). Any schoolboy Chemist should be able to point out that quicklime, as the Oxide of Calcium, can not further combust, having already combined with Oxygen.

The Chemistry is so elementary that I had to read the statement twice to be sure that I hadn’t missed some punctuation point, or other.

I shall be proof-reading any more Scientific facts that pop-up in this otherwise Quite Interesting book.

 

 

 

Why you shouldn’t buy a private pension.

April 27, 2012

The article below is about investing long-term but it refers to a principle, which I stumbled across many years since.

Private Pension funds are a good way to lose money. Apart from Funds going bust, being embezzled and raided by the Government (tax), they are managed by incompetents, with no incentive to protect your money, as they are guaranteed their wages through management fees.

As this piece underlines, investments should be made with a long term view. Better to save up for a year then buy a lump of shares in a large Supermarket chain, then, after  another year, a brewery etc. Picking companies that will always be able to find customers. Dividends can be re-invested and many shares come with shareholder privileges.

When you come to retire, voluntary, or otherwise, you don’t risk early withdrawal penalties or adminstration fees (although you do have to pay a stockbroker fee… another scam, in my opinion).

Those whose jobs pay insufficient to save for a pension (the reason that the State Pension was introduced) can buy hardware, which hold an intrinsic value (not tulip bulbs) e.g. jewelry, gold sovereigns, plots of land. But always diversify and make sure that your holding is unlikely to attract the attentions of the unscrupulous e.g. politicians, with a thirst for tax revenue.

Your free daily email from www.fullermoney.com:

The central truth of the investment business is that investment behavior is driven by career risk. In the professional investment business we are all agents, managing other peoples’ money. The prime directive, as Keynes1 knew so well, is first and last to keep your job. To do this, he explained that you must never, ever be wrong on your own. To prevent this calamity, professional investors pay ruthless attention to what other investors in general are doing. The great majority “go with the flow,” either completely or partially. This creates herding, or momentum, which drives prices far above or far below fair price. There are many other inefficiencies in market pricing, but this is by far the largest. It explains the discrepancy between a remarkably volatile stock market and a remarkably stable GDP growth, together with an equally stable growth in “fair value” for the stock market. This difference is massive – two-thirds of the time annual GDP growth and annual change in the fair value of the market is within plus or minus a tiny 1% of its long-term trend as shown in Exhibit 1. The market’s actual price – brought to us by the workings of wild and wooly individuals – is within plus or minus 19% two-thirds of the time. Thus, the market moves 19 times more than is justified by the underlying engines! This incredible demonstration of the behavioral dominating the rational and the “efficient” was first noticed by Robert Shiller over 20 years ago and was countered by some of the most tortured logic that the rational expectations crowd could offer, which is a very high hurdle indeed. Shiller’s “fair value” for this purpose used clairvoyance. He “knew” the future flight path of all future dividends, from each starting position of 1917, 1961, and all the way forward. The resulting theoretical value was always stable (it barely twitched even in the Great Depression), but this data was widely ignored as irrelevant. And ignoring it may be the correct response on the part of most market players, for ignoring the volatile up-and-down market moves and attempting to focus on the slower burning long-term reality is simply too dangerous in career terms. Missing a big move, however unjustified it may be by fundamentals, is to take a very high risk of being fired. Career risk and the resulting herding it creates are likely to always dominate investing. The short term will always be exaggerated, and the fact that a corporation’s future value stretches far into the future will be ignored. As GMO’s Ben Inker has written, two-thirds of all corporate value lies out beyond 20 years. Yet the market often trades as if all value lies within the next 5 years, and sometimes 5 months.

 

@theGreenParty Global Warming need not lead to rising sea-levels

April 27, 2012

I took this from the Fullermoney Newsletter. I find these reports trustworthy, as they do not have a political agenda (although many are presumably on the extreme right). These people rely on truth in order to make money from their investments. Similar to professional Horse racing fans, who base their selections on their own evaluation of a horse’s form and any reliable sources that they can exploit.

This February scientists at the University of Colorado, Boulder did just that. Using data from the Gravity Recovery and Climate Experiment (GRACE) satellites, the team began a more comprehensive global inventory of melting glaciers from 2003 to 2010. GRACE measures tiny changes in the Earth’s gravitational pull and gravity is related to mass. When glaciers lose ice, their gravitational pull weakens. The two satellites fly at 500km (310.7 miles), so they can detect this loss even for the hard-to-reach, high-altitude glaciers around the globe. The scientists published their findings in the February 8, 2012 issue of Nature, with global images showing the annual changes in ice thickness (in centimeters).

Shifting to other areas, the total global ice mass lost from Greenland, Antarctica and Earth’s glaciers and ice caps was about 4.3 trillion tons (1,000 cubic miles), enough to add 0.5 inches (12 millimeters) to global sea level. That’s enough ice to cover the United States 1.5 feet (0.5 meters) deep. A quarter of the average annual ice loss came from glaciers and ice caps outside of Greenland and Antarctica while ice loss from Greenland and Antarctica averaged 385 billion tons (100 cubic miles) a year.

However, this is 30% less than scientists had previously thought. Greenland and Antarctica are melting as much as experts expected, but the rest of the world was a surprise. The biggest discrepancy was in Asia.

The 2012 study showed the Himalayas and nearby peaks have lost almost no ice during the past 10 years. The scientists are careful to point out that lower-altitude glaciers in the Asian mountain ranges – sometimes dubbed the “third pole” – are definitely melting. Satellite images and reports confirm this. However, over the study period from 2003-10 enough ice was added to higher and more northern peaks to compensate.   My view – The implications of this concluding paragraph above, I concur, are that as gradually rising global temperatures cause lower glaciers in the Himalayas to retreat, some of the additional moisture released is being deposited in the colder upper regions.

@theGreenParty #occupy A new elected House of Representatives

April 27, 2012

Fred Forsyth (in the Daily Express) points out the folly of the present proposals for an elected House of Lords.

As he points out there would simply be a second body filled with second-raters nominated by the present political parties.

This does not mean that we should stick with the present system of unrepresentative, unelected tired out politicians and those born to privilege.

An elected House does not have to be party political and does not have to exist in the patronage of the present ruling political elite.

It could be made up of representatives of the true mix of Society.

The House of Commons is based on Geographical boundaries, The House of Lords is based on a single Socio-Economic boundary .

Make the new elected Second House consist of multiple Socio-Economic boundaries.

Instead of a member for Grimsby or Nuneaton, we could have a member for shop-workers, soldier’s, G.P.’s etc.

The list should not be difficult to arrive at; Insurance Companies already divide us into such groups, when we apply for car insurance.

Each candidate would  be required to prove that they have not been a subscribing member of any political party, during the preceding decade.  They would also have to prove a substantive association with their chosen “seat” e.g. employed in that particular trade/profession, during the previous decade. (allowance being made for those seeking re-election)

Instead of all elections happening on one day, the “seats” could be allocated one of 40 polling dates, spread across the year, enabling a system to be set up that would be able to run continuously and therefore efficiently.

This House of Representatives would be more Democratic than the House of Commons and would have a greater wealth of experience of the real world.

Is Postage Stamp hike a privatisation scam?

April 22, 2012

I’ve tried to follow the logic of the Post Office announcement of a huge increase in postal charges.

Bearing in mind that the ensuing panic-buying was inevitable, in view of stamps no longer bearing a price/value, was the intention to swell the coffers, to make Royal Mail look more attractive to a purchaser?

A purchaser who would only be looking at the balance sheet!

Unlikely that anyone with any business sense would excited by the prospect of effectively buying an over-priced debt, with delivery costs rising and limited future revenue.

This seems paradoxical, unless there is a scam that is yet to unfold.

Possible scenario’s are:

The Gov’t merely wishes to collect up some cash and that prices will not rise significantly.

A future purchaser will be allowed to welch on the present stamps and declare that they will represent a fixed value (the price, at which they were purchased) and that customers will have to purchase additional postage.

The first seems less likely as politico’s are loath to cap their own income.

The second seems the more likely, in that once it is privatised, politico’s can absolve themselves of their deceit, whilst a privatised Company can claim, with lots of media pundits lending support, that customers are not losing out and that they will be getting their outlay back.  (They had merely made an interest free loan).

I favour the later explanation as being most in line with the attitude of privatised utilities.

@WiganCouncil and Wigan traffic engineer: Saturday 21/4/12 Sherwood Crescent isn’t hazardous!

April 21, 2012

This is the route we are now forced to use, since the Wigan Traffic Engineer blocked off the Millers Lane access to Platt Street.

Despite numerous postings (under Wiganshale… Wigan Traffic Engineer) and emails to our Labour MP and our Labour councillors, no review, except a quick half-day jolly, to do a pretend census on traffic flow on Platt Street.

No feed-back on whether accident numbers have changed (seems to me as though there has been a slight increase) has been forthcoming.

Obviously the Wigan Traffic Engineer and our three Labour Councillors consider that the issue was decided a year before its implementation and that concerns of the local Community are of no importance.

#Occupy Sheila Bair explains how we could all be Millionaire’s, if Dizzy Ozzy agreed.

April 19, 2012

Sheila Bair: Fix income inequality with $10 million loans for everyone! – My thanks to a subscriber for this terrific article) by the former chairman of the Federal Deposit Insurance Corporation and published by the Washington Post. Here is the opening:

Are you concerned about growing income inequality in America? Are you resentful of all that wealth concentrated in the 1 percent? I’ve got the perfect solution, a modest proposal that involves just a small adjustment in the Federal Reserve’s easy monetary policy. Best of all, it will mean that none of us have to work for a living anymore.

For several years now, the Fed has been making money available to the financial sector at near-zero interest rates. Big banks and hedge funds, among others, have taken this cheap money and invested it in securities with high yields. This type of profit-making, called the “carry trade,” has been enormously profitable for them.

So why not let everyone participate?

Under my plan, each American household could borrow $10 million from the Fed at zero interest. The more conservative among us can take that money and buy 10-year Treasury bonds. At the current 2 percent annual interest rate, we can pocket a nice $200,000 a year to live on. The more adventuresome can buy 10-year Greek debt at 21 percent, for an annual income of $2.1 million. Or if Greece is a little too risky for you, go with Portugal, at about 12 percent, or $1.2 million dollars a year. (No sense in getting greedy.)

Think of what we can do with all that money. We can pay off our underwater mortgages and replenish our retirement accounts without spending one day schlepping into the office. With a few quick keystrokes, we’ll be golden for the next 10 years.

Of course, we will have to persuade Congress to pass a law authorizing all this Fed lending, but that shouldn’t be hard. Congress is really good at spending money, so long as lawmakers don’t have to come up with a way to pay for it. Just look at the way the Democrats agreed to extend the Bush tax cuts if the Republicans agreed to cut Social Security taxes and extend unemployment benefits. Who says bipartisanship is dead?

And while that deal blew bigger holes in the deficit, my proposal won’t cost taxpayers anything because the Fed is just going to print the money. All we need is about $1,200 trillion, or $10 million for 120 million households. We will all cross our hearts and promise to pay the money back in full after 10 years so the Fed won’t lose any dough. It can hold our Portuguese debt as collateral just to make sure.

My view – In the funny money world, everyone can be saved…for a while. We could do the same here in the UK, as the quantitative easing is very similar, and also the Eurozone now that the ECB has introduced its own version of QE with its LTRO loans.

Sheila Bair’s brilliant satirical piece conveys the longer-term implications or our monetary policies far more effectively than most economists, let alone politicians and central bankers.

@MoneySavingExp Fuel price’s likely to drop!

April 19, 2012

Extract from Fullermoney newsletter, basically says to expect fuel prices to drop.

One of   the great pleasures in life for economists is watching bubbles burst.

First   the speculative air is pumped in just beyond the point of reason.

There is always   a trader willing to say that a tulip bulb will soon be worth a million guilders;   an investment bank ready to predict $200 oil prices by the end of the year.  

There is always a looming war or a potential harvest failure to add spurious   justification. But the end is inevitably the same. The bubble bursts.  

That is what is happening now in the energy market. Sometimes the bubble deflates   rapidly, as with the US natural gas price – now at a 10-year low of less than   $2 per mmbtu. In other cases the air escapes slowly. That is what has been happening   to the oil price since the announcement of a modest fall in Chinese imports.  

Once the fall begins it tends to continue.

European gas prices are also declining   and utilities tied into long-term contracts are struggling to renegotiate terms.  

If the Japanese succeed in restoring some nuclear power capacity the Asia gas   market will follow the downward trend. Simultaneously the important report from   the UK’s energy department has reopened the door to shale gas development in   Britain and perhaps across Europe.  

The oil market is also set for a serious adjustment. Iran has backed off from   its threats to close the Strait of Hormuz, and another complex negotiating process   has begun in Istanbul to find a way in which Israel and Iran can step back from   a confrontation neither could win.

The sanctions on Iranian oil exports are   an important bargaining chip in these negotiations.

If there is any progress,   Iranian production will come back on to the market.

My (Fullermoney) view – There are a number  of interesting points in this article that I will comment on but it is not far off the Fullermoney view, although as bubbles go, I would say that oil has been  a small one recently.

However, there has certainly been an ‘Iran premium’ in   the market which a number of commentators have estimated at about $20.

That   sounds about right to me in terms of the more expensive Brent  benchmark price which does not reflect the shale (tight oil) impact that we   see in the US WTI price.

I have   often   mentioned in recent months that Brent prices were most likely overstating  the risk of an air strike against Iran’s nuclear facilities.

Nevertheless the  price is what it is and it has been a headwind for the global economy as we  also saw at this time last year.

 

@TheGreenParty Making car bodies produces more CO2 than a lifetime’s driving. Use Papier maché

April 16, 2012

Instead of railing against the car, read the piece below and push for papier maché car bodies.

These would be lighter (use less fuel/energy),  collapsible (less damage to pedestrians) and easily replaced /redesigned/coloured (all aspects are attractive in terms of a cottage industry and economic growth).

The only drawback is that car electrics rely on the metal body, as a return Earth, but this can be, easily, overcome by use of connected Earth points moulded into the body parts.

I’m not sure how reliable UNESCO  data is :

http://portal.unesco.org/education/en/file_download.php/a01355752c9e869a63cc5651084cfa30Cars+and+energy.pdf However, if we take the value for the energy needed to make a car as a starting point, we can reasonably discuss dependent issues. So we accept that it takes 20 GJ of energy to make a car.

From Consumer Reports (www.consumerreports.org/) we get that the average life expectancy of a new vehicle these days is around 8 years or 150,000 miles.

From http://www.inference.phy.cam.ac.uk/withouthotair/c3/page_29.shtml,  we can accept the value of 40kw-Hr/day as a reasonable figure for the daily energy consumption of a car. Hence we get 40 x 3600 x 365 = 52,560,000 joules per year.

So for 8 years that’s 420,480,000 Joules, or roughly 0.4 GJ.

I’m not sure how ell these figures stack up but the conclusion, using them, is that a car uses only 2% of the energy needed to make it.

We have a car industry blithely mass producing cars and a Government hell bent on scrapping cars, to the benefit of the motor industry, at as high a turnover rate as possible.

It would seem logical to try to achieve energy savings through consideration of reducing the planned obsolescence of cars.

At present most MOT failures are on rust, whilst most of the energy input is in making steel car bodies. Even electrical failures usually arise from rusting of the earth connections on the body work. This suggests moving away from a steel structure.