No 500! Wow! Three times as many words as in the Bible! A decade plus labour of love!
Some of you asked what I intended to do to celebrate. Unfortunately it’s Lent and for years I have given up booze for Lent. So I cannot even have a drink. So I have started going through back copies back to No. 58 (I seem to have mislaid the first 57) to see if there might be an interesting common thread. And I struck pay dirt withe the very second one, No 59 with an item that I have included in the attached as the lead-in to the lead-in. Abba Eban proved prophetic!
Have a great weekend.
No. 59 – November 28th, 2003
U.S. FACES MOODY’S DOWNGRADE (FP, Jenny Wiggins & Paivi Munster)
-According to Moody’s, for the US government “to avoid debt levels not compatible with the AAA rating category”, it must improve its public finances over the next decade through “reduced spending, more taxes, or some combination of the two”.
A misleading headline : Moody’s expects the government to deal with any fiscal strain before the problems become serious. Hopefully the observation by Abba Eban, one-time Israeli Foreign Minister, that “Men & nations behave wisely only once they have exhausted all the other alternatives.” won’t apply in this instance.
NOTE : This was when the US national debt was US$7TR, less than half of what it is today, and its debt-to-GDP ratio in the 60% range.
Much has already been written, & more will continue to be written, about what the outcome of the Italian elections really means. The political resurrection of Berlusconi (who is responsible for much of the mess Italy is in today) & the meteoric rise of the political nihilist Beppo Grillo (who really had no platform other than “Throw the bums out!”) from 1.8% voter support three years ago to < 10% a few months ago & 25% on election day is a message to politicians everywhere that voters think they are a bunch of idiots & are tired of their self-serving antics. And while Berlusconi’s rise from the ashes has been attributed to him making all sorts of tax promises, his voter support came largely from the North, & was a function of Northerners’ impatience with having to support a bunch of no-good-for-nothing Southerners. So not only are Europeans finally revolting against the from-the-top-imposed European integration idea, but they are also starting to raise questions about how well the existing national structures are serving them.
The ECB has long been engaged in Long Term Refinancing Operations (LTROs) whereby it loaned cheap short-term money to banks to enable them to “play the yield curve” by buying longer maturity government paper & making a “spread” over their cost of money (since more often than not, albeit not always, but that’s another story, interest rates are higher on longer-dated bonds). This directly subsidized the banks, & the government bond market indirectly. But in December 2011, for the first time ever, it did so on a medium-, rather than a short-term-, basis, lending them cheap three-year money. In the second such transaction, on February 29th, 2012, it advanced almost 530BN Euros in three year money to 800 banks. But on February 25th it announced that on February 27th, the first day prepayment could be made, 356 of these banks will be repaying 61BN Euros-worth of these loans (less than half the 130BN the market had expected) – the fact that they want to repay any of this cheap money at all suggests at least some harbour concerns about the short-term outlook for European government bond markets.
A recent letter to clients by a major bank whose research I learnt to respect decades ago dealt with the world food situation against the background of an anticipated 30% growth in global population by 2050. Its most critical finding was that in the years 2006-2008 the global food supply was over 50% in excess of what was needed to meet the basic dietary needs of today’s global population (according to the FAO, the minimum daily per capita dietary requirement is 1,850 calories, while actual output was equivalent to 2,829 calories). One reason why there may seem to be a problem is because 1+BN people in the world are undernourished; but overeating & obesity are a growing problem, & not just in North America. Another factor is the dietary change in the developing world towards eating more meat consumption (which is an inefficient way of meeting people’s dietary needs); thus in China annual per capital pork consumption has gone from 8 kg in 1975 to 37 kg in 2011 (which is still less than half Hongkong’s 79 kg). But the main reason for the world appearing to be living on the edge food security-wise is food waste, which the bank (conservatively?) estimates to account for one-third of all food produced; in the developed world this is due to wastage ‘downstream‘ (i.e. at the consumer level) & in the developing world to inefficiencies ‘upstream’ from a lack of infrastructure (incl. roads to get perishable foodstuffs in a timely fashion to market & of storage space to hold less perishable foodstuffs until they are needed in the market place and/or moved from areas of surpluses to areas of hunger). And while the bank acknowledges that water, or rather a shortage thereof for agricultural purposes, will increasingly become a constraints on farm output, it also point out that there is still much potentially cultivable-, but currently idle-, farm land, most of it in sub-Sahara Africa & Latin America – so the bottom line seems to be that what the world needs is not Monsantos pushing hi-tech Frankenfoods but a better use of already available resources with the aid of some pretty low-tech, common sense technology.
In the US consumer confidence jumped in February, the first increase in four months, to 69.6 from a downwardly revised 58.4 in February (suggesting a lack of concern about a “sequester”). And in January new home sales were 437,000, up 16% MoM & 29% YoY, while prices were up 0.6% & 6.8%. Some of the credit for this is given to household formation picking up as young people move out of their parents’ basements and/or quit sharing housing with others – these numbers should, however, be treated with caution as far as the health of the residential construction business is concerned; for unit numbers tell only part of the story : multi-unit housing (i.e. apartments & condos) still accounts for many housing starts & the square footage of new single family homes is declining : whereas it rose from 1,660 s.f. in 1973 to 2,521 s.f. in 2007, it has since shrunk back to 2,150 s.f., almost back to its 1990 level of 2,100 s.f.
Bernanke this week made his semi-annual pilgrimage to Capitol Hill to brief the Senate Banking Committee & the House Financial Services Committee on successive days. This will be his next-to-last appearance there; for his term ends in January & he has made it clear he doesn’t expect, & doesn’t want, an extension. While acknowledging that more inflation is one of the possible outcomes of the Fed’s US$85BN monthly bond buying program, he told the lawmakers the benefits of promoting a stronger economy & more rapid job creation outweigh the potential increased risk taking in some financial markets and that, where inflation was concerned, the Fed has the tools it needs to retreat from its monetary support for the economy “in a timely fashion”. He got a bit testy when Sen. Bob Corker (R.-Tenn) called him the “biggest dove … since World War II” & then twisted the knife by adding “I think it’s something you’re rather proud of”; for his response was : You called me a dove … Maybe in some respect I am, but my inflation record is the best of any Federal Reserve chairman in the postwar period, or at least one of the best, at about 2 percent.” – Alan Greenspan too was once deemed a financial hero but with the passage of time has become more of a financial goat because of the mess he bequeathed his successor; a similar fate could await Bernanke down the road if his inflation legacy turns out to as poisonous as some people believe it will. As to his assertion the Fed has the tools to claw back its support “in a timely fashion” this could be “hubris”, the pride that comes before the fall.
Back in 2007, prior to the onset of the financial crisis, the asset base of the world’s four major central banks relative to the size of their country’s GDP was 6% for both the Fed & the Bank of England, 12% for the ECB & 23% for the Bank of Japan. At last report they were 20%, 26%, 28% & 34% respectively – while the (far right-of-centre) US-centric source that drew this to my attention tut-tutted about the rise in the BoJ’s ratio, it went up by just 48% while that of the other three went up by 333%, 433%, & 233% respectively, albeit from much lower base lines. And the growth in Asian central banks’ asset bases has been just as spectacular; in the past decade they have grown 350%, & from much higher base lines (although China’s has ‘only’ doubled, to 50% of GDP). But there is a profound difference between the two phenomena : those in the advanced economies were internally-driven, the result of their purchases of domestic securities, while those in Asia were externally-driven, due their governments accumulating FX reserves.
According to Nomura Research 14 of China’s 31 provinces have shaded their 2013 GDP growth targets down, while the remainder have kept them unchanged; so their weighted average target is down to 9.9% from 10.3% for 2012. This is in part due to Beijing’s growing emphasis on the quality, rather than quantity, of economic growth & in part to concerns about rising debt levels.
According to Don Keyser, a former senior State Department official now at the right-wing China Policy Institute, Beijing is interpreting the publicly articulated US position on the Diaoyu/Senkaku Islands as a disinclination to become involved, & thus as a gaping hole in US foreign policy to be exploited with “salami” tactics to challenge the status quo, Japan’s “administrative control” of the islands (& the surrounding waters & sea bottom). This threatens the viability of the US strategic posture throughout then Asia-Pacific region & the credibility of its ‘pivot strategy’.
Gingko Tree Investment Inc. is a UK company wholly-owned by China’s State Administration of Foreign Exchange (the manager of the country’s official FX reserves). It is known to have recently invested US$1.8BN in assets in the UK, incl. a water utility, student housing and office buildings in London & Manchester. And there are rumours of several other deals.
Bolivian President Evo Morales is a friend/ally/soul mate of Venezuelan President Hugo Chavez who on February 18th returned home, in the dark of night with zero fanfare, from Cuba after two months of cancer treatments. But when the next day Morales, accompanied by Venezuela’s Vice President arrived in a cavalcade of cars at the military hospital where Chavez currently resides, they didn’t get to see him. He told the press the next day that “I was only able to meet the head doctor & his family…” draw your own conclusions!
For years prior to 2003 the price of uranium was in the US$10 range, only to skyrocket to US$150 by 2007, and then decline, via a US$50 intermediate low, to US$75 by 2011, whence it slid, speeded up by Fukushima, to less than US$50 today. Last year’s newly-mined supply was 54,000 tonnes & demand 69,000 tonnes (with much of the shortfall made up by uranium recovered from decommissioned Russian nuclear warheads). Right now two conflicting forces affect the spot price. While adverse weather conditions have constrained newly mined output from Kazakhstan, with a 30+% market share the world’s No. 1 uranium producer, & the government of Niger, the No. 4 producer, is arguing with French-owned Areva, that mines uranium there, over getting a bigger share of the pie, Japanese power companies, that have traditionally held several years’ uranium needs in inventory, have been selling uranium from inventory to raise money to pay back their post-Fukushima loans. Apart from that, the outlook for the price of uranium is quite bullish. In the short run, the agreement to recover uranium from Soviet era warheads expires this year & is not expected to be extended/renewed. And longer term, China, that now, with 13 nuclear power plants in operation, accounts for 25% of global uranium demand, has 27 more under construction (half of them to be in operation by 2020), 50 more in the planning stages, & 110 more proposals in the wings (the comparable numbers for the US are 104, 1, 9 & 23). Current estimates are that by 2025 global uranium demand will be in the 136,000 tonne range (twice today’s), and output of the mines now in existence, planned or proposed less than two-thirds that (of course uranium being what it is, another Fukushima or two could throw such demand forecasts into a cocked hat). And while economics, like nature, abhors a vacuum & moves to fill it, and uranium deposits are not rare, unsatisfied demand & higher prices will over the very long term prompt the development of new sources of supply – the scary part of all this, however, is that so far no one has yet figured out a safe, permanent solution to the disposal of the health-hazardous radioactive waste with a half life of thousands of years that the currently operating nuclear power reactors produce, never mind that of hundreds more in the future – the simplest & most sensible solution heard to date seems to be to put it right back whence it had come, i.e. in old uranium mines.
The latest edition of the IEA’s World Energy Outlook noted that 580BN cubic metres of water, 2½x New York City’s annual water consumption, are used each year in energy production (second only to agriculture), 85% of which is not returned to the environment, i.e. it remains underground, often in polluted form, whereas likely close to 100% of the water used in agriculture is so returned. And it expects that in the years ahead the demand for water for energy production purposes will grow at twice the rate of energy output, due to unconventional oil & gas production (first & foremost fracking) and the irrigation of biofuel crops, & it warns that “Water is growing in importance as a criterion for assessing the viability (of energy projects) as population- and economic growth intensify the competition for water.”
GLEANINGS II – 500
Thursday February 28th, 2013
CHINA-BASED CURRENCY BLOC LIKELY A FAIT ACCOMPLI
(Investor’s Digest, Peter Pham)
-The Washington-based Peter G. Peterson Institute, a international economics’ think tank, says such a bloc already exists as the growing trade between China & its Asian neighbours strengthens the relationship between their currencies & the yuan. But for the struggling Indonesian rupee, all major South East Asia currencies have now decoupled from the U.S. dollar. Thus Thailand’s baht is pegged to the yuan, and Singapore’s dollar pegged to the Malaysian ringgit at 0.4, which in turn is pegged to the yuan at 0.49 (Malaysia has been most pro-active in freeing its economy from both Europe & the US to the point where now just 20% of its trade is with non-Asian countries).
And China & Russia agreed last year to no longer to use the US dollar, but their own currencies, in their bilateral trade; all this means less need for third countries to hold US dollars in working capital balances, and erodes the dollar’s reserve currency role (the author is a ”specialist in capital markets” based in Ho Chi Minh City – the former Saigon-, Vietnam).
BREAST CANCER RATES ARE ON THE RISE AMONG YOUNG U.S. WOMEN
(G&M, Paul Taylor)
-This is the finding of a study by Rebecca Johnson, Medical Director of the Adolescent and Young-Adult Oncology Program at Seattle’s Children Hospital as lead researcher published in the Journal of the American Medical Association on February 26th. It found that over the past 30 years the incidence of metastatic breast cancer in 25- to 39-year-old women has risen steadily from 1.53 per 100,000 in 1976 to 2.90 in 2009, from 250 cases in 1976 to 850 in 2009 (& that the trend is accelerating). It also found that younger women tend to get a more aggressive form of the disease & have lower survival rates.
While Dr. Johnson speculated this may be due to factors like obesity, a high caloric intake & a more sedentary lifestyle, she didn’t rule out a possible role for the many chemicals now in every day use & said she had been “surprised about how little data there seems to be about direct relationships between toxic exposures and specific types of human cancers.”
KERRY’S DIVERGENCE FROM OBAMA ON FOREIGN CRISES RAISES QUESTIONS
(LAT, Paul Richter)
-The former is fired by a desire for a diplomatic success in the Middle East, to secure his legacy (he made his first phone call as Secretary of State to Israeli & Palestinian leaders while Hilary made her first trip to East Asia). But Obama is focused on winding down America’s wars overseas & preventing others from spreading. But Kerry, a Vietnam vet himself, is not awed by Israel’s combat past : “He’s been there. He’s unimpressed.”
-The problem with any such pre-occupation with the Middle East is that it makes China’s Asian neighbours wonder about how solid the US “pivot strategy” will be, going forward. And a loss of credibility in the region for that strategy would not be geopolitically desirable/helpful; for it would drive these nations into the arms of the Chinese (which is exactly what they want).
KERRY’S FIRST MAJOR SPEECH RAISES HOPE OBAMA WILL REJECT KXL PIPELINE
(The Council of Canadians, Brent Patterson)
-On February 20th at the University of Virginia he used his first major address in his new job to issue a clarion call for action on climate change, saying “We as a nation must have the foresight and courage to make the investments necessary to safeguard the most sacred trust we keep for our children and grandchildren : an environment not savaged by rising seas, deadly superstorms, devastating droughts and other hallmarks of a dramatically changing climate …”. And earlier, in the joint press conference with the visiting Canadian Foreign Minister (there to make a pitch for the pipeline), he was non-committal & was said to have been “tepid” about it when he had met with the Minister.
The Council has a hyper-nationalistic axe to grind (although on this occasion I agree with it, albeit for economic-, rather than jingoistic-, reasons).
GOVERNMENT’S LAW-AND-ORDER AGENDA TO TAKE A HIT IN FISCAL PLAN
(News 24, David Akin)
-On February 25th the Harper government outlined its spending plans for the fiscal year starting April 1st. It proposes an expenditure of $252BN, 2% less than in the current year. There will be winners & losers. The Department of Human Resources and Skills Development, which generates unemployment cheques, provides for skills training & pays for social housing, will get another $2.9BN, the provinces, despite (or because of) their whining will get $2.5BN, i.e. 2.9%, more, and the Department of Natural Resources & the Canadian Space Agency will get an additional $277MM & $125MM respectively (in last year’s Budget the latter was told to find $29.5MM in savings in its $300MM budget, and this year it gets a 40% increase – what gives?). But the losers fared worse : Defence is cut $2.7BN (13%), Border Services $357MM (17.5%), Correctional Services Canada, that runs the nation’s prisons housing those serving sentences of > two years, $427MM (14.2%), and the RCMP $58MM (2.1%). And foreign aid- & federal infrastructure programs are also getting slashed.
But the Senate, full of appointed political hacks, more & more of them Harper pets, and many of them as useless as tits on a boar hog, will get a smidgen more. Duh?
CANADA SHOULD INVESTIGATE OPPRESSION (News 24, Jessica Murphy)
-Some time ago, for misplaced ideological and/or minority-pandering reasons, Prime Minister Harper announced he would create an Office of Religious Freedom in the Department of Foreign Affairs that would be mandated to protect & further religious freedom in other countries. On February 20th he appointed an “ambassador” to head the $5MM/year operation, a former policy analyst in the Privy Council Office with “deep religious convictions” (supposedly after two earlier choices had told him “Thanks, but No Thanks”). Four days later, Tibet’s leader-in-exile, Lobsang Sangay (who last year succeeded the Dalai Lama), told the House of Commons’ Human Rights Committee that “religious freedom is one of the core issues” that have led 107 of his fellow Tibetans to self-immolate since 2009, & asked the government to send the ambassador to Tibet to investigate the situation.
He put Harper in a spot. Such a mission would have to be pre-approved by Beijing (which would not have a snowball’s chance in hell to be forthcoming). And the very fact of making such a request would be enough to rile Beijing). This whole idea was a waste of money all along. Harper borrowed it from Bush 43 who created a similar office in the State Department only to have it become an exercise in futility, & of frustration for the incumbent who found himself not just ignored by those Bush wanted him to target overseas, but sidelined by his own supposed colleagues. Many, many years ago I was involved in a meeting that occupied a roomful of civil servants for an entire afternoon seeking to make cuts in $440MM of Supplementary Estimates for the Government of Canada. When all was said & done the only reduction had been $110,000 in language training, prompting the then Minister of Finance, the late Mitchell Sharp, to observe ‘There is a smart & a stupid way to cut spending. The smart way is to go through a budget with a fine tooth comb and eliminate that which is least essential. We have just gone through such an exercise & proven that it doesn’t work. That leaves the stupid way of “Everyone gets x% less, what’s next on the agenda? We know that works”. And I have often reflected on the wisdom of his observation; for the smart way invariably turns into a massive “Après vous, Alphonse” exercise, while the stupid way treats everyone equally& avoids squabbles.
BILLIONS IN SAVINGS IN PIPELINE FOR QUEBEC REFINERS (G&M, Sophie Cousineau)
-National Bank Financial estimates Québec could save $3BN/year by buying oil from Alberta rather than importing it from abroad as it does at present. And not only would this mean a big cost saving, it would also reduce the Province’s $21BN annual trade deficit with the rest of the world (incl. the rest of Canada) by 15%.
-This is the very reason why the whole ‘national pipeline’ to the East idea will be still-born. Central Canada doesn’t want oil per se, it wants cheap oil. But Albertans already fret about ‘their’ money flowing East under the guise of “equalization payments”. Trudeau tried something similar in the 80’s with his National Energy Policy which Albertans saw as an attempt to steal “their” resources, that they universally have hated & detested ever since, and that for a while became the focus for Alberta separatism. And the first person who refers to it as National Energy Policy 2.0 dooms it, and doubly so if he/she were to resurrect the battle cry of the then Calgary Mayor, & subsequent Alberta Premier, Ralph Klein, of letting “the Eastern bastards freeze in the dark.”
DEAL WILL ALLOW TEACHERS TO SHOULDER MORE RISK (G&M, Tara Perkins)
-As of January 2012 the $117BN Ontario Teachers’ Pension Plan was $9.6BN in the red. Now its co-sponsors, the Government of Ontario & the Ontario Teachers’ Federation, have agreed to end the guaranteed inflation protection on benefits paid to plan members. Starting in 2015, until further notice only 45% inflation protection will be provided (while the goal remains to pay full inflation protection, the need to do so has been removed). This will wipe out, at one stroke, the Plan’s deficit. And the co-sponsors have also agreed to study ways to avoid future deficits, possibly by rejigging the number of years teachers work & draw benefits. This is a big issue; for in 1990 teachers worked, & made contributions, for an average 29 years & drew benefits for 25 whereas by 2011 they worked for just 26 & drew benefits for 30. The President of the Ontario Teachers’ Federation explained “It is difficult; teachers did take a reduction in benefits, but I think that ensures the sustainability of the pension plan and weathers the storm created by low interest rates and changing demographics.” And the Plan’s CEO believes this will give him more scope to invest in assets that over the longer term will generate higher-, albeit in the short term potentially more volatile-, returns.
This is truly remarkable since the teachers have all along been involved in a bitter pay dispute with the Province after the then Premier Dalton McGuinty first prohibited them from going on strike & then imposed new contracts on them. But they may have had little choice; for the Province’s Minister of Finance told them quite bluntly a year ago that, since the Province could not afford to pay additional (matching) contributions, the pension plan’s deficit would have to be tackled by cutting benefits. Be that as it may, the mindlessly warring Washington politicians could do worse than to take a page out of the Ontario government’s & teacher’s playbooks.
CHINA HAS ITS OWN DEBT BOMB (WSJ, Ruchir Sharma)
-Beijing has two options. It can sustain an unrealistic growth target by piling more debt onto an already formidable debt bomb, or rebalance its economy by cutting back on investment & the debt growth rate. But the latter would require accepting a growth rate of 5 to 6 percent (in other investment-led high growth economies, e.g. Brazil in the 70’s & Malaysia in the 90’s, economic growth typically fell by half after the investment peak).
The author is Head of Emerging Markets at Morgan Stanley Investment Management. It may be relevant in this context that recently, after writing the best-selling When a Billion Chinese Jump : How China Will Save Mankind – or Destroy it, the Guardian’s longtime Asia correspondent decamped from Beijing to become the paper’s Brazil-based Latin American correspondent.
TOXIC WATER : ACROSS MUCH OF CHINA, HUGE HARVESTS ARE IRRIGATED WITH INDUSTRIAL AND AGRICULTURAL RUNOFF (Circle of Blue, Nadya Ivanova)
•The seeds of the economic miracle that made China the world’s second largest economy are in its farm fields that each year grow about 600MM tonnes of food. But this comes with significant health risks as illustrated by the case of one farmer in Shandong Province, a prime food-growing province in the lower reaches of the Yangtze; for he explained as he irrigated his crop with water from a canal in which a nearby pharmaceutical factory dumps its effluent, “There’s no water source except this dirty water … we have to use it.” Much of China’s water is so contaminated it should not even be touched; and yet tremendous volumes of foodstuffs are irrigated with industrial waste water. According to scientists at Nanjing Agricultural University much of the rice produced in China is tainted by poisonous cadmium from mining & industrial sewage. After a number of food scares the public has made food security its No. 1 concern; experts have even given the problem a name : “water-quality-driven water shortage”. Nearly 10% of China’s 120MM hectares of cultivated land is now polluted (and that number is growing every day) & farmers are getting into the habit of having some fields in which they grow food for their families & others where they grow food for sale. But much of China’s water pollution comes from agriculture itself, from fertilizer-, pesticide-, & livestock waste-, run-off (China today is the world’s largest consumer of fertilizer & pesticides). So the government is providing for a bigger role for environmental regulations in its current Five-Year Plan (that ends in 2015) & has earmarked US$63BN in it for the water treatment sector. But regulations are often opposed, and not enforced at the local level when they conflict with economic considerations).
CHINA, POLLUTION AND CANCER VILLAGES (globalvoicesonline)
-On February 24th Ma Yun (aka Jack Ma), founder & CEO of Alibaba, China’s leading e-commerce company & its top Internet entrepreneur, addressed the 13th Annual Meeting of the Yabuli China Entrepreneurs Forum. He warned those present, many of whom are already spooked by the toxic combination of air-, & water-, pollution and food safety issues, that no amount of money can protect the rich from China’s cancer-causing pollution, and predicted that within a decade cancer will trouble every Chinese family.. Following is an excerpt of his talk “Thirty years ago how many people knew somebody with cancer? Cancer was a rare word. Now it has become a common disease … The
privileged class has clear water, but they can’t order clear air. I worry we work so hard, and finally all we earned goes toward medical expenses. No matter how much you make, if you can’t enjoy the sunshine, it’s really just a tragedy.”
-About the same time, the Global Times downloaded on Sina Weibo a map of China that showed a proliferation of “cancer villages’ in areas in China East of a North-South line through Chongquin. According to the Beijing Times the Ministry of Environmental Protection in its “12th Five-Year Plan for Prevention and Control of Environmental Risks from Chemicals” explicitly conceded that due to chemical poisoning “cancer villages” (and serious other health problems) have begun to emerge in some areas (which according to the activist journalist Deng Fei are spreading from central Eastern China into central Western China). And according to the Youth Times on February 23rd every five minutes five people die from-, & six more are diagnosed with-, cancer.
-The increasingly dire reports about water-, food-, & soil pollution are starting to affect the Communist Party’s hold on power & the country’s future development. So it’s not surprising that Beijing is proposing to spend, over the next decade, four hundred billion dollars on water projects. The environmental degradation can no longer be ignored.
He makes has a good point when he says that ‘no amount of money can protect the rich from China’s cancer-causing pollution’; for things change for decision makers when problems invade their personal lives, & that of their families. The official estimate of the number of cancer villages is one hundred, with other estimates going as high as four hundred. And isn’t it ironic that in a totalitarian system that supposedly is run top-down, the leadership responds to bottom-up pressure for change, while in democratic countries like the US & Canada the leaders mostly ignore bottom-up pressures (the Traverse City, Mich.-based Circle of Blue aspires to provide relevant, reliable & actionable information about global resource crises). All this fits with what I tell people time & again, “In the 18th, 19th & 20th century Man thought he could control Nature; but, if we want to survive the 21st century, we’d better start, & get used to, working with Nature.”
ANOTHER H5N1 PATIENT DIES IN SW CHINA (Xinhua)
-The first, a 21 year-old woman died of February 13th from multiple organ failure. The second, a 31 year-old man, died from the same cause at the Jinyang Hospital in Guizhou City, Guizhou Province on February 22nd after developing symptoms of February 3rd & being hospitalized on February 8th. Both tested positive for the virus of February 17th, and both were known to have been in close contact with birds.
The disease is likely endemic there & will only become a problem if it were to spread from there to places where people have less natural immunity.
FROM CITY STREET TO STEAK HOUSE (G&M, Stephanie Nolen)
-India’s ‘beef’ exports (much of it from water buffalo, not cows) are expected to grow 30% this year to give it a 25% global beef export market share, thrice that three years ago. While the more lucrative markets, such those of the EU, are still closed to Indian beef due to their food safety standards, Indian beef exporters are doing a landslide business in the Middle East & in Asian countries (where eating meat on a regular basis has become a status symbol), with last year Vietnam being its biggest client. Most of the animals are raised by small producers, often landless peasants, many of them right in the middle of cities where they graze on whatever land happens to be handy. Apart from that, the dairy business has also exploded : since 1998 India has been the world’s largest milk producer. But public health experts view all this with alarm since livestock & people live in each other’s pockets so to speak, increasing the scope for the spread of disease and, as one researcher puts it, “This government really does not have the capacity to manage an epidemic and it’s going to be huge when it comes.
University of Calgary medical microbiologist Johann Pitout for several years already has been studying a particularly nasty bug, thought to have been brought to North America by people who had been in India for surgery. Called gram-negative bacteria, it’s not fatal, just all but impervious to all known antibiotics, often shows up in urinary tract infections & is hard to treat.
FRANCE’S JOBLESS CLAIMS HIGHEST SINCE 1997 (Bloomberg)
-In January they grew for the 21st month in a row, by 43,900 (1.4%), more than twice the 17,500 economists had expected, to 3.169MM..
With the EC forecasting 0.1% GDP growth this year, it’s likely to get worse before it gets better.