Archive for 28/09/2013

Brazil blowing down

Nova workboard

Habitats in UK have suffered several damages over the last decades as  the development´s process has been encouraged by political institutions. However, the UK economic growth has been disappointing over the most recent years, and that the UK government has intended to conciliate economic growth (through better development) and biodiversity protection.

The UK government has proposed  the  “biodiversity offsetting” system, which in general means that the developers planning to build infrastructure close to  natural environment will have to offset the damage made by paying an amount equal to that damage.

From my point of view, the crucial point regarding these biodiversity system has to with the developer´s incentives to reduce damages:  is it better for developer to implement new productions methods, more expensive but more environmentally friendly, or on the other hand  goes on  with the same production´s method ( less expensive) and pays a high amount to the government…

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Global Risk Insights

Scotland will hold a referendum in 2014 to allow its people to choose whether they wish to stay in the United Kingdom or become an independent nation. If the majority of Scotland were to vote yes, a complex set of negotiations with the UK on the single market and other issues such as defense would ensue.

Catalonia’s referendum on the other hand would be framed within the Spanish constitutional structure, which does not allow for secession. If the Catalans were to choose to become independent, a second referendum would probably be required at the national level, which in all likelihood would result in a majority vote against Catalan independence. Another possibility would be to try to change the Spanish constitution.

Either way, Catalans might be willing to exert pressure on the process through social unrest. Both Scotland and Catalonia have a visceral attachment to their independent identities. With the prospect…

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Eye on Housing

Measures of consumer confidence fell in September following strong growth at the start of the year and a summer of mixed signals. The Conference Board reported that the Consumer Confidence Index decreased by 2.1 points, 2.6%, on a month-over-month seasonally adjusted basis in September to 79.7. According to Thomson Reuters and the University of Michigan, the Consumer Sentiment Index fell in September by 4.6 points from the previous month and nearly 9% from six-year high of 85.1 in July.


Both measures fell in large part as consumers grew more pessimistic about jobs and earnings. According to the Conference Board, the share of consumers expecting fewer jobs increased at the same time the share expecting an increase in incomes decreased. In September, 15.4% anticipated an increase in income over the next 6 months down from 17.5% in August.

In spite the decline in consumer confidence, according to the Conference…

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Albert Edwards accuses Fed of inequality cover up.

Income Growth 99 vs 1

Hanlon’s razor admonishes us to, “Never attribute to malice that which is adequately explained by stupidity.” The Federal Reserve’s monetary policy is promoting income inequality as our table above illustrates, but I do not believe that the Fed’s action are malevolent.

Standard monetary procedure in the U.S. has been to loosen the money supply in the wake of a recession.  The Fed went to this well one too many times and was forced to embark upon its novel money printing experiment.  Today, it is stuck.  Surely some Fed officials have figured out that their actions are making the rich richer and the poor poorer, but the present policy cannot be terminated.  Even discussing the end of the program causes market distress.

Once money printing begins it must continue until either the printing or the lack thereof causes a crisis.  As we…

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Everyone's a Pundit


I bit off a little bit of Plug Power Inc. (Ticker:PLUG) today, a little late to the recent rally. I’ve been watching it this week, but had other irons in the fire in shippers and rare earth plays.

PLUG is somewhat of a YOLO trade for me, I don’t expect much out of it. In terms of what I’m interested in at this point, though, it fits right in, i.e. green energy. I enjoy reading and learning about the variety of future technologies that will replace coal and petroleum as our primary sources of energy.

Plug operates in the fuel cell space, providing Proton Exchange Membrane (PEM) systems for commercial use, specifically forklifts. They have clients ranging from Wal-Mart to BMW, as companies look for more efficient means to produce energy throughout their manufacturing processes.

Fuel cells are interesting, though perhaps not quite as viable in the short to mid…

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