Eeyore's News and View

Avoiding A Blackout

By INVESTOR'S BUSINESS DAILY Posted Tuesday, October 14, 2008 4:20 PM PT

Energy: The hot months of 2009 might be known as the Summer of Brownouts. And it will be considered a good year, because, unless hundreds of billions are invested in the U.S. power system, the brownouts will turn black.

Blackouts are more than an annoyance. They are costly in terms of economic loss and needless deaths.

In less than 48 hours, the Aug. 14, 2003, blackout, the largest power outage in U.S. history, ran up as much as $12 billion in economic losses. Life went dark for roughly 60 million Americans and Canadians, many of whom also lost their water supplies, as well.

At least 11 died from various causes linked to the loss of electricity. Looting, fires and general civic unrest plagued the big cities affected by the blackout.

A once-in-a-lifetime event, an anomaly that shouldn't require a second thought? Not necessarily.

"The U.S. faces potentially crippling electricity brownouts and blackouts beginning in the summer of 2009, which may cost tens of billions of dollars and threaten lives," says the NextGen Energy Council's report, "Lights Out In 2009?"

If the nation is to avoid a repeat of the 2003 blackout, its power supply desperately needs to be boosted through new construction of nuclear-, coal- and gas-fired plants. NextGen estimates that 120 gigawatts of new generation, enough to power as many as 48 million homes, will be needed to provide a 15% reserve margin. That's the rough minimum needed to ensure that the system is reliable.

But that's only half the fix. Additional electricity is worthless if it can't be distributed to users. NextGen estimates the U.S. needs more than 14,500 miles — that's New York to Los Angeles and back three times — of transmission lines by 2016 to relieve congestion that will inevitably cause power outages if the issue isn't addressed.

The improvements need to begin immediately. Power demand is expected to grow by 18% over the next 10 years while estimates indicate that power output will increase only 8% through 2016.

In a fully rational world where markets are left to themselves, the work would get done. The capital is available and the incentives are in place.

But our world is filled with irrational actors who foolishly — and predictably — resist the changes that are obviously needed to move forward by erecting difficult regulatory and policy hurdles. The "development of numerous coal plants," for instance, has been canceled or deferred in recent years, NextGen says, because of environmental rules.

"The single biggest threat to system reliability," says the NextGen report, "is opposition from well-funded environmental groups that oppose and file lawsuits against virtually every new electricity project proposed."

Report authors say at least $300 billion will be needed to update the system. But as long as policymakers let themselves be bullied and bought off by environmental groups, it might as well be $300 trillion.

Well it does not seem we can get away from posts on the economy, or at least i can't. So today we will have a few on what happened over the week-end. Americans in general are acting like nothing is happening, or maybe nothing big is going on. But people should open their eyes and look around. Our Countries leaders and business's have gotten us the US so tied up in this "global economy" nonsense that a prudent man needs to notice it. If these other Countries fall, we will fall also. So it time wake up out of sleep and start paying attention before it too late.

Car makers slam on brakes as orders slump

Further shockwaves hit the global car industry yesterday when Peugeot Citroën said that it would have to cut production by 30 per cent and Chrysler set out plans to shed up to 5,000 jobs.
The gloom extended to the lorry market when Volvo reported a sharp fall in third-quarter earnings and a slump in orders. Peugeot Citroën said that it had to make “massive production cuts” in the last three months of the year to try to balance output with dwindling demand. The cuts will come in Europe and are likely to fall most heavily in France and Spain.
Peugeot's cuts, news of which came as it reported a 7 per cent fall in car sales for the third quarter, follow a series of warnings about the weak state of the market from other car companies.
On Thursday Renault cut its full-year profits forecast after what it said was a “sharp drop in the European market”. Daimler, of Germany, also lowered its forecast for the full year. Renault, which controls Nissan, the Japanese manufacturer, expects an operating margin of between 2.5 and 3 per cent. Previously it had set a target of 4.5 per cent. Peugeot slashed its margin from 3 per cent to 1.3 per cent.
(You can read the rest of the article here if you want)http://business.timesonline.co.uk/tol/business/industry_sectors/engineering/article5010327.ece

GLG chief Emmanuel Roman warns thousands of hedge funds on brink of failure
Emmanuel Roman, the co-chief executive of Europe’s biggest hedge fund GLG, has warned that thousands of hedge funds are on the brink of failure as the global economy contracts with unexpected severity.

Emmanuel Roman, of GLG Partners, said 25pc-30pc of the world’s 8,000 hedge funds would disappear "in a Darwinian process", either going bust or deciding meagre profits are not worth their efforts.
"This will go down in the history books as one of the greatest fiascos of banking in 100 years," said Mr Roman, who with Noam Gottesman, co-runs GLG, a former division of Lehman Brothers Holdings with assets of $24bn (£14.8bn). "There need to be some scapegoats, and the regulators are going to go hunt people. That will be good in the long run."
His views were echoed by Professor Nouriel Roubini, a former US Treasury and presidential adviser known for his accurate prediction of financial crises, who estimated that up to 500 hedge funds would fail within months.
Both men were speaking at the same hedge fund conference in London yesterday, and Prof Roubini said he would not be surprised if the US and other countries soon had to close their stock markets for more than a week to halt descent into "sheer panic".
The economist warned that the world is heading for a protracted recession that will end the US’s financial dominance.
"It’s the beginning of the decline of the US financial empire. The Great Depression ended in a massive war. I hope that’s not going to happen
but it’s pretty ugly now," Prof Roubini said.
He added that turmoil over world trade, currency markets and debt is likely to cause geopolitical tensions between the Western world and emerging superpowers such as Russia, China and "a bunch of unstable oil states".
The conference saw analysts, economists and hedge fund managers discussing the possibility that global recession could now last two years on fears that government bail-outs and nationalisations have failed to stop the markets slumping. (you can read the rest here)http://www.pyrabang.com/contenteditor.php?pd=4084&ps=4530&org=4207&target=http://www.telegraph.co.uk/finance/financetopics/financialcrisis/3248965/GLG-chief-Emmanuel-Roman-warns-thousands-of-hedge-funds-on-brink-of-failure-financial-crisis.html

Stocks point higher as global shares jump

NEW YORK – U.S. stocks appeared headed for a rebound Tuesday as investors awaited the start of a two-day meeting of the Federal Reserve that is widely expected to bring another reduction in interest rates. Dow Jones industrial average futures rose 338, or 4.22 percent, to 8,349.
Standard & Poor's 500 index futures gained 37.00, or 4.43 percent, to 871.70, while Nasdaq 100 index futures rose 51.50, or 4.43 percent, to 1,213.50.
The sharp rise in stock market futures contracts Tuesday was to be expected given the extreme volatility that has been the hallmark of Wall Street's behavior for more than a month. At the same time, the sometimes light volume of futures trading can make it difficult to determine the market's overall mood. In recent weeks, stock futures have moved solidly in one direction, while actual trading was more moderate after the opening bell.
A higher open would come as casualties from the global crisis piled up Tuesday: Whirlpool Corp. said it will cut about 5,000 jobs by the end of 2009, Iceland said it needs $6 billion and Germany said Pakistan must secure a loan from the International Monetary Fund within a week.
Still, a stock market rebound appeared likely early Tuesday after the Dow Jones industrials fell more than 200 points Monday on worries about the economy, giving the blue chips a loss of more than 500 over two sessions. A worldwide rally after huge losses Monday likely helped sentiment early Tuesday.
Bond prices fell. The yield on the benchmark 10-year Treasury note, which moves opposite its price, rose 3.80 percent from 3.69 percent late Monday. The yield on the three-month Treasury bill, regarded as the safest investment around and an indicator of investor sentiment, rose to 0.85 percent from 0.77 percent Monday. A higher yield indicates a dip in demand.
The dollar was mixed against other major currencies. (the rest of the story is at the link)

http://news.yahoo.com/s/ap/wall_street

H.R. 808: Department of Peace and Nonviolence Act

The following summary was written by the Congressional Research Service, a well-respected nonpartisan arm of the Library of Congress. GovTrack did not write and has no control over these summaries.
2/5/2007--Introduced.
Department of Peace and Nonviolence Act - Establishes a Department of Peace and Nonviolence, which shall be headed by a Secretary of Peace and Nonviolence appointed by the President with the advice and consent of the Senate. Sets forth the mission of the Department, including to: (1) hold peace as an organizing principle; (2) endeavor to promote justice and democratic principles to expand human rights; and (3) develop policies that promote national and international conflict prevention, nonviolent intervention, mediation, peaceful resolution of conflict, and structured mediation of conflict.
Establishes in the Department the Intergovernmental Advisory Council on Peace and Nonviolence, which shall provide assistance and make recommendations to the Secretary and the President concerning intergovernmental policies relating to peace and nonviolent conflict resolution.
Transfers to the Department the functions, assets, and personnel of various federal agencies.
Establishes a Federal Interagency Committee on Peace and Nonviolence.
Establishes Peace Day. Urges all citizens to observe and celebrate the blessings of peace and endeavor to create peace on such day.

(For the complete Text you could go here http://www.govtrack.us/congress/billtext.xpd?bill=h110-808 ) Thanks to Jerry D. Young for the heads up on this one.