Category: Other

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Christopher Hitchens: On the burka – Telegraph

The French legislators who seek to repudiate the wearing of the veil or the burka – whether the garment covers “only” the face or the entire female body – are often described as seeking to impose a “ban”. To the contrary, they are attempting to lift a ban: a ban on the right of women to choose their own dress, a ban on the right of women to disagree with male and clerical authority, and a ban on the right of all citizens to look one another in the face. The proposed law is in the best traditions of the French republic, which declares all citizens equal before the law and – no less important – equal in the face of one another.

via Christopher Hitchens: ‘I wish I’d done more of everything’ – Telegraph.

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Sun-Powered Schools Save $30M

Hawaii Pacific Solar will install solar panels at [15 Kauai schools in Hawaii] at no cost to the state. The department will buy electricity generated by the panels from Hawaii Pacific Solar [at] a rate of about 16.9 cents per kilowatt hour. The rate will rise to 28 cents an hour over the course of the 20-year contract.

…….The department will save an estimated $30 million over the life of the project, Abercrombie’s office said. The forecast assumes commercial electricity rates will increase an average of 3 percent per year.

via Sun-Powered Schools Save $30M.

Comment: ~ According to the EIA, average US retail price for electricity was 12.17 cents per kWh in August 2011 while industrial usage averaged 7.47 cents per kWh and commercial 10.83 cents per kWh. Prices increased on average by 1.3 percent from August 2010.

Rates vary from 20 to 45 cents per kilowatt hour on the islands, according to Hawaiian Electric Company (HECO). They explain:

“The cost of electricity in Hawaii is higher than on the U.S. mainland for a number of reasons. In Hawaii the electrical systems on each island are independent. Because there are no neighboring utility companies from which to draw power in the event of a problem, we must have reserve generating capacity and multiple distribution routes. This increased infrastructure is paid for by a small population.

Additionally, our use of oil to produce electricity drives up costs. Mainland states primarily use lower-cost resources that aren’t readily available here. To reduce Hawaii’s use of oil, protect our environment, and improve energy security, we are committed to significantly increasing our use of renewable energy resources.”

So the solar solution is only relevant to Hawaii because of high local electricity costs. It would only be viable for mainland (commercial) use if solar electricity charges could be reduced by 36 percent. And it would be a brave man/woman who commits to a 20-year escalation at 2.5 percent.

Renewable energy sources remain on the fringe, contributing less than 4.9 percent of the national total if we exclude hydroelectric power. Other Energy Sources comprises biomass, geothermal, solar, wind and other miscellaneous energy sources:

US Energy Sources

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The Black Swan of Cairo: How suppressing volatility makes the world less predictable and more dangerous

Complex systems that have artificially suppressed volatility tend to become extremely fragile, while at the same time exhibiting no visible risks. In fact, they tend to be too calm and exhibit minimal variability as silent risks accumulate beneath the surface. Although the stated intention of political leaders and economic policymakers is to stabilize the system by inhibiting fluctuations, the result tends to be the opposite. These artificially constrained systems become prone to “Black Swans” — that is, they become extremely vulnerable to large-scale events that lie far from the statistical norm and were largely unpredictable to a given set of observers.

….Preventing small forest fires can cause large forest fires to become devastating. This property is shared by all complex systems. In the realm of economics, price controls are designed to constrain volatility on the grounds that stable prices are a good thing. But although these controls might work in some rare situations, the long-term effect of any such system is an eventual and costly blowup whose cleanup costs can far exceed the benefits accrued.

….Humans simultaneously inhabit two systems: the linear and the complex. The linear domain is characterized by its predictability and the low degree of interaction among its components which allows the use of mathematical methods that make forecasts reliable. In complex systems, there is an absence of visible causal links between the elements, masking a high degree of interdependence and extremely low predictability. Nonlinear elements are also present, such as those commonly known, and generally misunderstood, as “tipping points.” Imagine someone who keeps adding sand to a sand pile without any visible consequence, until suddenly the entire pile crumbles. It would be foolish to blame the collapse on the last grain of sand rather than the structure of the pile, but that is what people do consistently, and that is the policy error.

The Black Swan of Cairo: How suppressing volatility makes the world less predictable and more dangerous
By Nassim Nicholas Taleb and Mark Blyth

Colin Twiggs: ~ This is a must read for those who want a deeper understanding of why complex systems fail and why we are continually blind-sided by unforeseen political and economic events.

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$707,568,901,000,000: How (And Why) Banks Increased Total Outstanding Derivatives By A Record $107 Trillion In 6 Months | ZeroHedge

In the first 6 months of 2011, the total outstanding notional [amount] of all derivatives rose from $601 trillion at December 31, 2010 to $708 trillion at June 30, 2011. A $107 trillion increase in notional in half a year. Needless to say this is the biggest increase in history. So why did the notional increase by such an incomprehensible amount? Simple: based on some widely accepted (and very much wrong) definitions of gross market value (not to be confused with gross notional), the value of outstanding derivatives actually declined in the first half of the year from $21.3 trillion to $19.5 trillion (a number still 33% greater than US GDP). Which means that in order to satisfy what likely threatened to become a self-feeding margin call as the (previously) $600 trillion derivatives market collapsed on itself, banks had to sell more, more, more derivatives in order to collect recurring and/or upfront premia and to pad their books with GAAP-endorsed delusions of future derivative based cash flows.

via $707,568,901,000,000: How (And Why) Banks Increased Total Outstanding Derivatives By A Record $107 Trillion In 6 Months | ZeroHedge.

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Thorium: the dream of green nuclear energy

While the idea of building small, thorium-based nuclear reactors – thought to be dramatically safer, cheaper, cleaner and terror-proof than our current catalog of reactors – can be shooed away as fringe by some, the germ of the idea began in the U.S. government’s major atomic lab, at Oak Ridge, Tennessee, in the 1960s, only to be left by the wayside as the American nuclear industry plowed ahead with its development of the light water reactors and the uranium fuel cycle.

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Life lessons from an ad man

Rory Sutherland explains how we can add value by changing our perceptions:

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Most entertaining!

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CME Group Clarifies Maintenance Margin Ratios – Exchange to Reduce Initial Margin Ratio to 1.00 – PR Newswire – sacbee.com

CHICAGO, Nov. 5, 2011 — /PRNewswire/ — CME Group today is clarifying its notice to clearing firms regarding margins. In light of the issues customers transferring out of MF Global are facing, while still maintaining appropriate risk management protections for the market, CME Clearing is setting the “initial” margin upcharge to zero. This upcharge is normally applied to customer accounts when they are receiving a margin call.

The intention and effect of these changes are to decrease the size of any margin calls resulting from the bulk transfer of MF Global customers to new clearing members not to increase them.

This is a short term accommodation to maintain market integrity and provide temporary relief to customers whose accounts have been disrupted by this event.

We apologize for any confusion our initial advisory may have created.

via CME Group Clarifies Maintenance Margin Ratios – Exchange to Reduce Initial Margin Ratio to 1.00 – PR Newswire – sacbee.com.

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Because Of A ZeroHedge Post, Tons Of People Are Worried About A Commodity Market Meltdown On Monday

ZeroHedge has also updated the post, so it seems that everyone is in agreement. Margins aren’t being hiked on everyone, they’re being lowered, most likely so that ex-MF Global customers can transfer trades without having to post a ton of new margin to keep their trades on.

via Because Of A ZeroHedge Post, Tons Of People Are Worried About A Commodity Market Meltdown On Monday.

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