Baltic Dry Index. 1543 +12
LIR Gold Target by 2019: $30,000. Revised due to QE.
Note: There will be no LIR tomorrow or Friday due to the return of my mother from hospital and the start of her home care therapy. With God’s help, she can spend the rest of her days among the family in the family home she has known since 1954, and in the better weather, enjoy the garden that gave her so much pleasure.
Today, we open with Bloomberg and a scandal in Japan’s very flawed nuclear power industry. Neighbouring countries must now be very alarmed about the safety of all of Japan’s nuclear plants. Sadly this will damage the credibility of the nuclear industry everywhere.
"I doubt if any of them would even intentionally double-park."
President Richard Nixon.
Fukushima Engineer Says He Helped Cover Up Flaw at Dai-Ichi Reactor No. 4
By Jason Clenfield - Mar 23, 2011 12:54 AM GMT
One of the reactors in the crippled Fukushima nuclear plant may have been relying on flawed steel to hold the radiation in its core, according to an engineer who helped build its containment vessel four decades ago.
Mitsuhiko Tanaka says he helped conceal a manufacturing defect in the $250 million steel vessel installed at the Fukushima Dai-Ichi No. 4 reactor while working for a unit of Hitachi Ltd. (6501) in 1974. The reactor, which Tanaka has called a “time bomb,” was shut for maintenance when the March 11 earthquake triggered a 7-meter (23-foot) tsunami that disabled cooling systems at the plant, leading to explosions and radiation leaks.
“Who knows what would have happened if that reactor had been running?” Tanaka, who turned his back on the nuclear industry after the Chernobyl disaster, said in an interview last week. “I have no idea if it could withstand an earthquake like this. It’s got a faulty reactor inside.”
Tanaka’s allegations, which he says he brought to the attention of Japan’s Trade Ministry in 1988 and chronicled in a book two years later called “Why Nuclear Power is Dangerous,” have resurfaced after Japan’s worst nuclear accident on record. The No. 4 reactor was hit by explosions and a fire that spread from adjacent units as the crisis deepened.
Hitachi spokesman Yuichi Izumisawa said the company met with Tanaka in 1988 to discuss the work he did to fix a dent in the vessel and concluded there was no safety problem. “We have not revised our view since then,” Izumisawa said.
Kenta Takahashi, an official at the Trade Ministry’s Nuclear and Industrial Safety Agency, said he couldn’t confirm whether the agency’s predecessor, the Agency for Natural Resources and Energy, had conducted an investigation into Tanaka’s claims. Naoki Tsunoda, a spokesman at Tokyo Electric Power Co., which owns the plant, said he couldn’t immediately comment.
Much more.
In other Japan news, now Tokyo’s water has been polluted with radioactive iodine. “Don’t worry, it’s still safe for adults to drink”, say the experts, but in light of the above article would you trust the Tokyo officials? Even if true, for how much longer? Meanwhile estimates of the cost of the earthquake and tsunami continue to mount.
Tokyo Issues Tap Water Warning for Infants
By DAVID JOLLY and KEVIN DREW Published: March 23, 2011
TOKYO — Infants in Tokyo and surrounding areas should not drink tap water, a Tokyo official said Wednesday, after radioactive iodine from a crippled nuclear power plant was detected in the capital’s water supply.
Ei Yoshida, head of water purification for the Tokyo water department, made the announcement at a televised news conference. He said iodine-131 had been detected in water samples at a level of 210 becquerels. The recommended limit for infants is 100 becquerels.
For adults, the recommended limit is 300 becquerels.
The Health Ministry said in a statement that it was unlikely that there would be negative consequences to infants who did drink the water, but said it should be avoided if possible and that it should not be used to make infant formula.
The warning applies to the 23 wards of Tokyo, as well as the towns of Mitaka, Tama, Musashino, Machida and Inagi to the west of the city.
More.
http://www.nytimes.com/2011/03/23/world/asia/24japan.html?hp
Japan's Quake Damage May Swell to $309 Billion, Four Katrinas
By Keiko Ujikane - Mar 23, 2011 7:51 AM GMT
Japan’s government estimated the damage from this month’s record earthquake and tsunami at as much as 25 trillion yen ($309 billion), an amount almost four times the hit imposed by Hurricane Katrina on the U.S.
The destruction will push down gross domestic product by as much as 2.75 trillion yen for the year starting April 1, today’s report showed. The figure, about 0.5 percent of the 530 trillion yen economy, reflects a decline in production from supply disruptions and damage to corporate facilities without taking into account the effects of possible power outages.
The figures are the first gauge of the scale of rebuilding Prime Minister Naoto Kan’s government will face after the quake killed more than 9,000 people. Japan may set up a reconstruction agency to oversee the rebuilding effort and the central bank has injected record cash to stabilize financial markets.
Damages will probably amount to between 16 trillion yen and 25 trillion yen, today’s report said. It covers destruction to infrastructure in seven prefectures affected by the disaster, including damages to nuclear power facilities north of Tokyo. Wider implications on the economy, including how radiation will affect food and water supply, are not included in the estimate.
---- Today’s report didn’t include specific forecasts for how the damage would affect GDP, which economists at Morgan Stanley MUFG Securities Co. forecast may contract as much as an annualized 12 percent in the second quarter. GDP expanded at a 3.2 percent rate in the second quarter after the 1995 Kobe quake.
”We need to bear in mind that the risk that stagnation in production will linger due to the effect of the earthquakes,” Economic and Fiscal Policy Minister Kaoru Yosano said at a press conference in Tokyo today. “We could see the biggest impact come from the power-supply issues that are affecting production.”
More.
In other news, the world’s latest war is going well, isn’t making much difference, is splitting NATO and the world into competing factions, according to one’s preference. It isn’t often Germany gets to align its foreign policy alongside Brazil and China rather than America, NATO, and the rest of the EU. Perhaps the reason Germany abstained at the UN was the memory of what happened last time the “Desert Fox” took on Britain’s 8th Army in Cyrenaica. Below, yesterday’s developments on “our side” in Benghazi.
Libyan Rebel Council Forms Oil Company to Replace Qaddafi’s
By Bill Varner - Mar 22, 2011 9:17 AM GMT
Libyan rebels in Benghazi said they have created a new national oil company to replace the corporation controlled by leader Muammar Qaddafi whose assets were frozen by the United Nations Security Council.
The Transitional National Council released a statement announcing the decision made at a March 19 meeting to establish the “Libyan Oil Company as supervisory authority on oil production and policies in the country, based temporarily in Benghazi, and the appointment of an interim director general” of the company.
The Council also said it “designated the Central Bank of Benghazi as a monetary authority competent in monetary policies in Libya and the appointment of a governor to the Central Bank of Libya, with a temporary headquarters in Benghazi.”
The Security Council adopted a resolution on March 17 that froze the foreign assets of the Libyan National Oil Corp. and the Central Bank of Libya, both described in the text as “a potential source of funding” for Qaddafi’s regime.
Libya holds Africa’s largest oil reserve. Output has fallen to fewer than 400,000 barrels a day, Shokri Ghanem, chairman of the National Oil Corp., said on March 19. The country produced 1.59 million barrels a day in January, according to estimates compiled by Bloomberg. Exports may be halted for “many months” because of sanctions and unrest, the International Energy Agency said.
More.
Below, the view from the other side, and a lineup on the coalition’s military assets aligned against Gaddafi. Includes a picture of the French nuclear carrier Charles de Gaulle, under tow on its way to the region????
22 March 2011 Last updated at 16:13
Defiant Gaddafi pledges victory
More.
http://www.bbc.co.uk/news/world-africa-12806112
We end with the return of the EU’s Club Med crisis. Today it’s tiny Portugal objecting to being hammered with German imposed austerity. Next month it will likely be Italy’s turn, as the sink with the increasingly bombed out Gaddafi government.
Portugal Braces for Govt Collapse Over Debt Vote
Portugal braces for minority government's collapse as lawmakers ready for key debt vote
By BARRY HATTON Associated Press LISBON, Portugal March 22, 2011
Portugal's government is on the verge of collapse after opposition parties withdrew their support for another round of austerity policies aimed at averting a financial bailout.
The expected defeat of the minority government's latest spending plans in a parliamentary vote Wednesday will likely force its resignation and could stall national and European efforts to deal with the continent's protracted debt crisis.
The vote comes on the eve of a two-day European Union summit where policymakers are hoping to take new steps to restore investor faith in the fiscal soundness of the 17-nation eurozone, including Portugal.
http://abcnews.go.com/Business/wireStory?id=13191470
"The leaders of the French Revolution excited the poor against the rich; this made the rich poor, but it never made the poor rich."
Fisher Ames, 1758-1808.
At the Comex silver depositories Tuesday, final figures were: Registered 41.11 Moz, Eligible 63.23 Moz, Total 104.34 Moz.
+++++
Crooks and Scoundrels Corner.
The bent, the seriously bent, and the totally doubled over.
No crooks again today just “moon man” in New Zealand.
"Nothing contributes so much to the prosperity and happiness of a country as high profits."
David Ricardo, 19th century economist.
Christchurch begins to believe 'Moon Man' who predicted quakes
By Tim Hume in Auckland Wednesday, 23 March 2011
A maverick "lunar forecaster" who claims to have predicted both New Zealand's major recent earthquakes provoked fear and outrage when he warned that another devastating jolt would strike Christchurch last Sunday. Scientists made a public bet that it wouldn't – and were then left exasperated as the city was shaken by the biggest aftershock since the February catastrophe.
Ken Ring, a grey-bearded, hitherto obscure fishing commentator, has become the subject of heated public debate in recent months over his earthquake predictions, based on the pseudoscientific belief that quakes are caused by the gravitational pull of the Moon on tectonic plates.
Although rubbished by seismologists, the theory gained traction as word spread that the "Moon Man" appeared to have predicted both the initial September quake, and the February disaster which killed about 182 people.
Gaining support from Christchurch residents frustrated that science had been unable to usefully predict the killer aftershock, Mr Ring used his new platform to warn of another impending giant quake – one that "could be another for the history books" – on the morning of 20 March, as the Moon passed close to the Earth. "The killer is still loose on the streets, the one that strikes on full moons," he wrote.
His warnings to stay away last weekend prompted some traumatised residents to flee their homes, and played on the nerves of many who remained. "Even people who would normally discard it or say it's only superstition are becoming extremely fearful," said Lynette Hutson, co-ordinator of the Salvation Army's counselling service.
In response, scientists, politicians and sections of the media moved to calm the hysteria. Current affairs broadcaster John Campbell savaged Mr Ring in a primetime interview which was roundly criticised as unfairly hostile, and seemed only to create sympathy for the "Moon man".
On Sunday, a group of geologists, engineers, and a cabinet minister with a PhD in geotechnical engineering gathered at a publicity-courting "non-event", holding a lunch in one of Christchurch's oldest, tallest buildings, at the time the "7 plus" doomsday quake was supposed to strike.
The lunch passed without incident. The sceptics were satisfied. But that night, at 9.47pm, the city was shaken by a 5.1-magnitude aftershock. It was about a thousand times less powerful than the killer that Mr Ring had prophesied, and it came 10 hours late. But it was the biggest aftershock since the February disaster and, for many of Mr Ring's supporters, it came as the most public of vindications.
---- Mr Ring has gone to ground over critical media coverage, including revelations he previously worked as a party clown and magician, and once wrote a book about palmistry for cats. He did not reply to questions.
"There is no way of keeping profits up but by keeping wages down."
David Ricardo, 19th century economist.
The monthly Coppock Indicators finished February:
DJIA: +156 Down 05. NASDAQ: +217 Down 11. SP500: +157 Down 4.
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