Saturday 30 October 2021

Special Update 30/10/2021 The G-20, COP26 Racket.

Baltic Dry Index. 3519 -111 Brent Crude 84.38

Spot Gold 1783

Covid-19 cases 02/04/20 World 1,000,000

Deaths 53,100

Covid-19 cases 30/10/21 World 246,757,475

Deaths 5,004,451

"A senior U.N. environmental official says entire nations could be wiped off the face of the Earth by rising sea levels if the global warming trend is not reversed by the year 2000."

The official was Noel Brown, director of the New York office of the U.N. Environment Program, 1989.

A G-20 summit and the start tomorrow of COP26, the greatest hot air emissions conference planet Earth has yet devised. How unlucky can Earthlings get.

This weekend, a special, Special Update, two for one. The G-20 Lords of the Universe gathering in Rome, once centre of a great Empire, long gone and the start of the two week long COP26 eco-lunatics summit in rainy Glasgow, Scotland, once the centre of a great ship building industry, also long gone.

Collapsed by communist UK labour unions, unwilling to modernise, a lack of capital following two World Wars and the rise of cheap labour Asia, with the resources and land to expand shipbuilding in ways the cramped, shallow Clyde could only envy.

This weekend, we proudly bring you the sound of one hand clapping.

Trudeau, The Conflicted, and Biden, The Letdown: A guide to G-20 leaders and why a climate deal is so hard

The push to consign coal to history and achieve net-zero emissions by mid-century looks out of reach

Flavia Krause-Jackson  Oct 29, 2021

The Group of 20 came into its own during the 2008 financial crisis in order to avoid a global depression. It was a turning point that made clear that big decisions could no longer be taken without the fastest growing economies.

Story continues below

Fast forward to now, and the leaders of the nations that account for 75% of global carbon emissions are again being called to arms to avert another catastrophe — a climate one. The G-20 is meeting in Rome this weekend right before COP26 in Glasgow, the United Nations gathering that aims to set specific goals to wean nations off coal and other noxious substances for good.

This time around, the G-20 risks falling short and a draft communique seen by Bloomberg News shows just how much is still up in the air. For starters, some key players aren’t showing up in person. Last year the entire summit was held virtually due to the Covid-19 pandemic.

The push to consign coal to history and achieve net-zero emissions by mid-century looks out of reach. There is a sense that the old establishment represented by the Group of Seven nations tried to impose itself on the likes of China, Russia and India rather than actively engage them.

The mood of mutual suspicion is hard to bridge without the kind of face-to-face contact that can clear the air. The meeting comes as countries grapple with spiraling energy costs and supply-chain shortages, challenges that are reigniting geopolitical tensions between producers and users.

The chaotic withdrawal from Afghanistan and President Joe Biden’s inability to set climate goals at home have also cast a shadow on U.S. leadership when most needed.

Here is your guide to the complicated considerations of leaders as they attend, or dial in, to the two-day summit starting Oct. 30.

Italy | Mario Draghi, The Host

It’s a bit of awkward for the man who saved the euro and likes to get things done. The reality is that, as the unelected technocratic leader of a smaller developed economy, he’s not in a position to dictate climate terms. Italy itself has yet to make a contribution to the $100 billion fund aimed at helping poorer countries. As the former head of the European Central Bank, Draghi commands respect and is carving a larger role for himself within Europe’s circle of influence — but corralling G-20 holdouts into submission might prove beyond even his abilities. At home he’s focused on restoring order to the economy amid speculation his next career move might be to become head of state.


Rich nations to acknowledge climate change threat, take urgent steps -draft communique

ROME, Oct 29 (Reuters) - Leaders of the 20 richest countries will acknowledge the existential threat of climate change and will take urgent steps to limit global warning, a draft communique seen ahead of the COP26 summit shows.

As people around the world prepared to demonstrate their frustration with politicians, Pope Francis lent his voice to a chorus demanding action, not mere words, from the meeting starting on Sunday in Glasgow, Scotland.

The Group of 20, whose leaders gather on Saturday and Sunday in Rome beforehand, will pledge to take urgent steps to limit global warming to 1.5 degrees Celsius (2.7 degrees Fahrenheit).

While the 2015 Paris Agreement committed signatories to keeping global warming to "well below" 2 degrees above pre-industrial levels, and preferably to 1.5 degrees, carbon levels in the atmosphere have since grown.

"We commit to tackle the existential challenge of climate change," the G20 draft, seen by Reuters, promised.

"We recognise that the impacts of climate change at 1.5 degrees are much lower than at 2 degrees and that immediate action must be taken to keep 1.5 degrees within reach."

----Climate activist Greta Thunberg, who has berated politicians for 30 years of "blah, blah, blah" is among those who took to the streets of the City of London, the British capital's financial heart, to demand the world's biggest financial companies withdraw support for fossil fuel.


Demonstrators in the United States also protested outside several Federal Reserve Bank buildings and other banks.


The net-zero pledges are dubious. Burning fossil fuels for economic growth remains the priority

Eric Reguly October 29, 2021

The climate conference that starts in Glasgow this weekend is turning into a global prisoner’s dilemma.

It is, of course, in all countries’ interests to pursue the common good by reducing carbon emissions so that potentially catastrophic global warming, a definite economy killer over the long term, is averted. Reduced output also cleans the air we breathe, spurs the growth of a vast renewable energy industry and helps ensure that carbon sinks – forests – are not eradicated. Everyone wins.

But it is also in each country’s interests to pursue immediate GDP growth to create wealth and jobs. The most efficient way to do so is to burn fossil fuels – coal, oil and natural gas – as quickly as possible. That’s the dilemma – common interest or self-interest?

There is a distressingly good chance that the burn-baby-burn approach will win the day at the climate conference, known as COP26 (Conference of the Parties). There is no compelling reason to think that this conference will be any different than all the previous ones.

Since the first United Nations climate change conference, in Berlin in 1995, planet-warming carbon dioxide emissions have gone one way – up, relentlessly – despite endless efforts at annual COPs to stop or at least slow their growth. Targets are set, commitments made. Then pretty much nothing.

----It appears that many prisoners have made their choice: damn the emissions, economic growth is the goal. And not just any economic growth; it is growth of the “black” variety that still dominates the agenda, despite great leaps forward in the “green” economy, whose features range from recycling and wind farms to electric cars and sustainable hydrogen production.

Coal, the dirtiest fossil fuel, simply refuses to die. Last year, a record-tying 38 gigawatts of coal plants were shuttered, mostly in the United States and Europe. But China alone is set to open 39 gigawatts of new plants, according to Bloomberg Green.

----But what about the net-zero emission commitments?

Most countries, including Canada, have pledged to achieve net zero by 2050, though a few big emitters, notably China, Indonesia, Russia and Saudi Arabia, insist they can’t get there until 2060 (Germany and Sweden went for 2045). Net zero means not adding to the level of greenhouse gases in the atmosphere. It is achieved by drastic emission cuts combined with offsetting measures, such as planting trees, to compensate for the emissions that can’t be eliminated.

The net-zero pledges are both welcome and dubious.

Most are back-end loaded, meaning the majority of the cuts are to come well after 2030, the year by which many countries have set interim reduction targets (Canada is aiming to cut its emissions to at least 40 per cent below 2005 levels by 2030). By then, the majority of politicians who made the pledges will be out of office or six feet under.


COP26 aims to banish coal. Asia is building hundreds of power plants to burn it

By Sudarshan Varadhan and Aaron Sheldrick October 29, 2021 5:54 AM EDT

UDANGUDI, India/TOKYO, Oct 29 (Reuters) - On the coastline near India's southern tip, workers toil on a pier carrying a conveyor belt that cuts a mile into the Indian Ocean where the azure waters are deep enough for ships to berth and unload huge cargoes of coal.

The belt will carry millions of tonnes of coal each year to a giant power plant several kilometres inland that will burn the fuel for at least 30 years to generate power for the more than 70 million people that live in India's Tamil Nadu state.

The Udangudi plant is one of nearly 200 coal-fired power stations under construction in Asia, including 95 in China, 28 in India and 23 in Indonesia, according to data from U.S. nonprofit Global Energy Monitor (GEM).

This new fleet will produce planet-warming emissions for decades and is a measure of the challenge world leaders face when they meet for climate talks in Glasgow, where they hope to sound the death knell for coal as a source of power.

Coal use is one of the many issues dividing industrialised and developing countries as they seek to tackle climate change.

Many industrialised countries have been shutting down coal plants for years to reduce emissions. The United States alone has retired 301 plants since 2000.

But in Asia, home to 60% of the world's population and about half of global manufacturing, coal's use is growing rather than shrinking as rapidly developing countries seek to meet booming demand for power.

More than 90% of the 195 coal plants being built around the world are in Asia, according to data from GEM.


Next, back in the real world, is Australia a hint of things to come to every nation rigging their interest rates? Ominously, the answer is probably yes.

Australia's central bank loses yield control as bonds melt down

SYDNEY, Oct 29 (Reuters) - Australia's central bank on Friday lost all control of the yield target key to its stimulus policy as bonds suffered their biggest shellacking in decades and markets howled for rate hikes as soon as April.

An already torrid week for debt got even worse when the Reserve Bank of Australia (RBA) again declined to defend its 0.1% target for the key April 2024 bond , even though its yield was all the way up at 0.58%.

Scenting capitulation, speculators sent the yield sky-rocketing to 0.75% while yields on three-year bonds recorded their biggest monthly increase since 1994.

All eyes were now on the RBA's policy meeting on Nov.2 where investors were wagering it would call time on yield curve control (YCC) and its guidance of no rate rises until 2024.

"The only conclusion we can draw is that the YCC regime is about to be formally dumped at next week’s meeting," said Ben Jarman, a rate strategist at JPMorgan.

"If so this is a startling about-face," he added. "Dropping YCC is a strong signal, so we bring forward our expectation for the first hike from late 2023 to Q4, 2022."

Markets are already well ahead of him with futures pricing in a hike in the 0.1% cash rate to 0.25% as early as April, while swaps have rates above 1% by year-end.

Yields on three-year bonds surged to their highest since mid-2019 at 1.25%, bringing the rise for the week to a portfolio punishing 47 basis points. For the month, yields were up an astonishing 90 basis points likely leaving many investors deeply underwater.


Most analysts argue the market has got ahead of itself on hikes given annual wage growth in Australia of 1.7% is still far below the RBA's desired level of 3% or more.

While core inflation data this week surprised on the high side at 2.1%, that is still only just in the RBA's target band of 2-3% having been under it for almost six years. To average 2.5%, it would need to run above 3% for an equal period.

A Reuters poll of analysts found the median expectation was for a hike in the second quarter of 2023, though the risk was clearly for an earlier move.

Calling for a hike at all might seem odd given the economy almost certainly contracted sharply in the third quarter as coronavirus restrictions shut Sydney and Melbourne.

However, the country's success in vaccinations has seen the lockdowns relaxed and consumer spending pick up. Data out Friday showed retail sales rebounded 1.3% in September after three months of steep losses, handily beating forecasts.


Finally, EV subsidies are great for some, but why have taxpayer EV subsidies at all?

Behind That Hertz Tesla Purchase

The rental-car company has a secret business weapon: Taxpayers.

Oct. 26, 2021 6:52 pm ET

The more you look behind corporate and government press releases these days, the more you learn about their mutual benefit society. We wrote Tuesday about the many subsidies for Tesla’s electric cars, but it turns out there’s also a pot of subsidy gold behind the Hertz decision to buy 100,000 Teslas for its car-rental fleet.

Tesla CEO Elon Musk says he isn’t giving Hertz a discount on the reported $4.2 billion order. But he doesn’t need to because the House reconciliation spending bill includes a 30% tax credit for “qualified commercial electric vehicles.”

The text doesn’t clearly define what is a “qualified commercial electric” vehicle, but our sources say Hertz’s Teslas would likely make the cut. The credit could save Hertz $1.26 billion and make a Tesla almost as cheap for Hertz to buy as a Toyota Camry.

Hertz plans to install thousands of electric-vehicle chargers, which could also be eligible for taxpayers subsidies. The House spending bill extends a 30% tax credit for the installation of EV charging stations through 2031, which is on top of the $7.5 billion appropriation for stations in the separate Senate infrastructure bill.

Hertz’s interim CEO Mark Fields is casting the company’s Tesla order as a strategic business decision and evidence that EVs are going mainstream. Maybe, and there’s no doubt that the Tesla order is winning progressive accolades for the rental-car company. Electric vehicles are also less expensive to maintain than gas-powered cars, so they could reduce Hertz’s operating costs.

But if EVs make business sense, why must the government subsidize them? Democrats complain that corporations aren’t paying their fair share in taxes, but then they give them generous tax breaks for promoting progressive policies that reduce their tax payments.

In 2006, while promoting his movie “An Inconvenient Truth”, Al Gore said that humanity had only 10 years left before the world would reach a point of no return.

Gore’s movie also featured animations of water inundating Manhattan and Florida.

Global Inflation Watch.  

Given our Magic Money Tree central banksters and our spendthrift politicians,  inflation now needs an entire section of its own.

Inflation notches a fresh 30-year high as measured by the Fed’s favorite gauge

Annual inflation rose at its fastest pace in more than 30 years during September despite a decline in personal income, the Commerce Department reported Friday.

Headline price pressures as gauged by the personal consumption expenditures price index including food and energy increased 0.3% for the month, pushing the year-over-year gain to 4.4%. That’s the fastest pace since January 1991.

Stripping out food and energy costs, inflation rose 0.2% for the month, in line with the Dow Jones estimate, and 3.6% for the 12-month period, unchanged from August but good for the highest since May 1991. The Federal Reserve prioritizes the so-called core PCE reading among a battery of measures it uses for inflation.

The continued inflation jump came as personal income declined 1% in September, more than the expected 0.4% drop. Consumer spending increased 0.6%, in line with Wall Street estimates.

The headline inflation rate was pushed by a 24.9% increase in energy costs and a 4.1% gain in food. Services inflation rose 6.4% on the year while goods increased 5.9%.

The inflation and income numbers come as the Fed is grappling with the specter of higher prices and lower growth. Gross domestic product increased at just a 2% annualized pace in the third quarter, the slowest since the recovery began off a recession that ended in April 2020.


Euro zone inflation equals all-time high; growth accelerates

By Balazs Koranyi and Philip Blenkinsop  October 29, 20215:59 AM EDT

FRANKFURT/BRUSSELS, Oct 29 (Reuters) - Euro zone inflation shot past expectations this month to equal its all-time-high, creating a policy dilemma for the European Central Bank, which has consistently underestimated the stress created by the economy's reopening from COVID-19 lockdowns.

Growth has soared as consumers return to stores and venues but many businesses have been unable to keep up with demand, putting pressure on prices which are already being driven higher by the rising costs of commodities.

Inflation in the 19 countries sharing the euro rose to 4.1% in October from 3.4% a month earlier, beating a consensus forecast of 3.7%. That reading is the highest since 2008 and equals the all-time-high for the time series launched in 1997.

While inflation was mostly driven by higher energy prices and tax hikes, growing price pressures from supply bottlenecks were also visible in rising prices for services and industrial goods, data from Eurostat showed on Friday.

The economic boom was also clear in growth figures.

The euro zone economy grew by 2.2% in the third quarter compared to a year earlier, its fastest pace in a year and also well ahead of expectations, as businesses reopened. It is now set to hit its pre-crisis size before the end of the year.

----At 4.1%, inflation is already more than twice the ECB's target and is likely to accelerate further in the coming months before a slow retreat next year when some technical one-off drivers get knocked out of year-earlier figures.

Although energy prices accounted for the biggest chunk of inflation, underlying prices were also above 2%, which ECB policy hawks may seize on to argue that it is time to dial back extraordinary stimulus.


The party's over: Pub bosses warn pint prices will rise despite Budget promises

Thursday 28 October 2021 10:23 pm

A major pub boss has swiftly ended the party for cheaper pints, warning prices could creep up by 25p to 30p in spite of the 3p price cut promised by ‘fizzy Rishi’ in Wednesday’s Budget.

Speaking to BBC’s Today Programme, Shepherd Neame chief executive Jonathan Neame, whose brewery runs 300 pubs across the South East, warned the cut in alcohol duties will not be felt due to spiralling inflation.

“We will pass on the duty cut at a wholesale, but in all honesty, pubs are facing between 25p to 30p per pint inflation and all this will do is take the top of that,” he said.

While Rishi Sunak’s announced overhauling of alcohol duties was largely welcomed by the pub sector yesterday – reflected in Wetherspoons’ and Marstons’s rising share prices – some industry chiefs remain sceptical.

Hikes in costs of energy, food, and wages coupled with supply chain squeezes have put hospitality under mounting pressure. “Too much is being borne by retail and hospitality,” said the pub chief.

Though the sector has welcomed the 50 per cent cut in business rates, Neame regretted the “missed opportunity for fundamental reform in rates.”

Meet skimpflation: A reason inflation is worse than the government says it is

 October 26, 20216:31 AM ET

---- What's happening in the Magic Kingdom is happening across the entire economy. Domino's is taking longer to deliver pizzas. Airlines are putting customers who call them on hold for hours. Restaurants, bars and hotels are understaffed and stretched thin. The quality of service seems to be deteriorating everywhere.

We've all heard about rising inflation. The price of stuff is going up. And if you read this newsletter, you've heard of shrinkflation. That's when the price of stuff stays the same, but the amount you get goes down. The economywide decline in service quality that we're now seeing is something different, and it doesn't have a good name. It's a situation where we're paying the same or more for services, but they kinda suck compared with what they used to be. We propose a new word to describe this stealth-ninja kind of inflation: skimpflation. It's when, instead of simply raising prices, companies skimp on the goods and services they provide.

Skimping has a derogatory connotation, and, we should note, not all companies are Cruella de Vil or Scrooge McDuck. Many businesses, especially small businesses, are struggling to cope with surging costs and pandemic-related expenses. They're having a hard time finding workers at the wages they used to pay. And some businesses may be unable to afford paying what it takes to recruit workers in the current environment. Nonetheless, whether it's because they can't afford to, they don't want to or they're being greedy, instead of enticing workers with higher wages, many businesses are cutting back on the quality of their services in order to stay profitable. And the Oxford dictionary definition of the word "skimp" seems to fit what they're doing: "Expend or use less time, money, or material on something than is necessary in an attempt to economize."

While it may lurk in the shadows, make no mistake: Skimpflation is a form of inflation. As with normal inflation, it means we're getting less for our money. And some argue the government is failing to properly account for this kind of inflation when crunching official statistics.


Below, why a “green energy” economy may not be possible anyway, and if it is, it won’t be quick and it will be very inflationary, setting off a new long-term commodity Supercycle. Probably the largest seen so far.

The “New Energy Economy”: An Exercise in Magical Thinking

Mines, Minerals, and "Green" Energy: A Reality Check

"An Environmental Disaster": An EV Battery Metals Crunch Is On The Horizon As The Industry Races To Recycle

by Tyler Durden Monday, Aug 02, 2021 - 08:40 PM

In 1982, U.N. official Mostafa Tolba, executive director of the UN Environment Program, warned:

“By the turn of the century, an environmental catastrophe will witness devastation as complete, as irreversible, as any nuclear holocaust.”

Covid-19 Corner                   

This section will continue until it becomes unneeded.

Thousands gear up for tech blowout in Lisbon in test of new normal

MADRID/STOCKHOLM, Oct 29 (Reuters) - Web Summit, one of the largest tech conference organisers, will open its doors next week in Lisbon for its first in-person event since the pandemic struck, with the likes of Microsoft, Amazon and Apple set to speak.

Hot on the heels of the Mobile World Congress (MWC) in Barcelona in June, it will be the next large tech conference to test a return to normal, reuniting entrepreneurs, top executives and major investors after 19 months of video meetings.

About 40,000 attendees are slated to join the summit, which will feature 1,000 speakers ranging from Microsoft (MSFT.O) Vice Chairman Brad Smith to Apple (AAPL.O) software boss Craig Federighi, addressing audiences including founders of companies which have only recently emerged.

"It's almost 100% in-person attendees - we don't sell online-only tickets," Web Summit co-founder Paddy Cosgrave said. "Most of these company founders have never been seen in person: they went from nowhere to somewhere exclusively in the last two years of lockdown."

Players in the tech sector, which gained unprecedented financial clout and political reach as the coronavirus pandemic accelerated digitalisation worldwide, are set to tackle themes ranging from privacy and regulation to racism and fintech.

While Facebook CPO Chris Cox will be talking about the "metaverse", on another stage the social media group's newest whistleblower Frances Haugen will discuss the network's grasp over its 3 billion users - or nearly half the planet.

---- "As people head to Web Summit - for what will be the first physical event for many - I think everyone will be looking forward to the serendipitous meetings, chats between stage sessions, and bumping into old friends in-person again," Harry Nelis, partner at venture capital fund Accel, told Reuters.

A gathering of this size also brings into focus safety precautions against the spread of the coronavirus and bears the risk of turning into a "superspreader" event, though the venue - Portugal - is among the world's most-vaccinated countries.

"We will have teams across the venue monitoring capacity, ensuring one-way traffic flows," Cosgrove said. Numerous outdoor meeting spaces were created for small groups, along with on-site medical staff and isolation rooms in every building, he added.

For conference organisers, a successful event is critical to stay above water. Last year's event cancellation forced MWC to lay off about 40% of its staff, with MWC organiser and telecoms industry association GSMA taking a hard hit. read more


Next, some very useful vaccine links kindly sent along from a LIR reader in Canada. The links come from a most informative update from Stanford Hospital in California.

World Health Organization - Landscape of COVID-19 candidate vaccines

NY Times Coronavirus Vaccine Tracker

Regulatory Focus COVID-19 vaccine tracker

Some more useful Covid links.

Johns Hopkins Coronavirus resource centre

Rt Covid-19

The Spectator Covid-19 data tracker (UK)

Technology Update.

With events happening fast in the development of solar power and graphene, I’ve added this section. Updates as they get reported.

Old Power Gear Is Slowing Use of Clean Energy and Electric Cars

Some people and businesses seeking to use solar panels, batteries and electric vehicles find they can’t because utility equipment needs an upgrade.

Oct. 28, 2021, 3:00 a.m. ET

Seven months after workers finished installing solar panels atop the Garcia family home near Stanford University, the system is little more than a roof ornament. The problem: The local utility’s equipment is so overloaded that there is no place for the electricity produced by the panels to go.

“We wasted 30,000-something dollars on a system we can’t use,” Theresa Garcia said. “It’s just been really frustrating.”

President Biden is pushing lawmakers and regulators to wean the United States from fossil fuels and counter the effects of climate change. But his ambitious goals could be upended by aging transformers and dated electrical lines that have made it hard for homeowners, local governments and businesses to use solar panels, batteries, electric cars, heat pumps and other devices that can help reduce greenhouse gas emissions.

Much of the equipment on the electric grid was built decades ago and needs to be upgraded. It was designed for a world in which electricity flowed in one direction — from the grid to people. Now, homes and businesses are increasingly supplying energy to the grid from their rooftop solar panels.

These problems have become more urgent because the fastest way to cut greenhouse gas emissions is to move machinery, cars and heating equipment that currently run on oil and natural gas to electricity generated by solar, wind, nuclear and other zero-emission energy sources. Yet the grid is far from having enough capacity to power all the things that can help address the effects of climate change, energy experts said.


Winter Watch.

The Northern hemisphere snow and the Arctic ice cover.

U.S. and Northern Hemisphere Snow Cover

Read scientific analysis on Arctic sea ice conditions.


This weekend’s musical diversion.  Approx. 6 minutes.

A. VIVALDI: Chamber Concerto in F major RV 98, E. Bosgraaf / Ensemble Cordavento

This weekend’s maths update. Approx. 14 minutes.

Key to the Tower of Hanoi - Numberphile

Landing at the world’s most dangerous airport. Approx. 15 minutes.

The WORST WIND SHEAR EVER At Remote Island Airport - St. Helena Island Challenge


"The threat of a new ice age must now stand alongside nuclear war as a likely source of wholesale death and misery for mankind,” Calder warned in International Wildlife magazine in 1975.

That quote was dug up by George Mason University economist Walter E. Williams, who argues that there are so many apocalyptic predictions because “they have an agenda for more government control ... fear about the environment is a way to gain government control,” Williams told Fox News.

“Communism and socialism have lost respectability, so it’s been repackaged as environmentalism,” he added.