Archive - Feb 2014 - Story

We've seen first hand the tremendous opportunity that exists in the world, and the incredible way that human beings innovate to overcome challenges. But the reality is that the world is on fire right now. In some places, like Ukraine or Thailand, quite literally. In many others (like Japan, China, and much of southern Europe), there are heaps of smoldering embers beneath a continent-wide funeral pyre. And in the Land of the Free, it’s as if politicians and central bankers are smoking their back-room cigars at the foot of a mountain of napalm and thermite that grows ever-higher by the day. If you step back and look at the big picture, there is cause for concern.

The world’s most notorious and powerful drug lord, Joaquin “El Chapo” Guzman Loera, has reportedly been captured in Mexico. The head of the Sinoloa Cartel - nicknamed Chapo or "shorty" - was caught last night, according to the AP, at a hotel resort in Mazatlan in a joint US-Mexico operation. Forbes ranked Guzman 67 out of 72 on their list of the World’s Most Powerful People. With revenues believed to exceed $3bn, his Sinaloa cartel is easily the most powerful in Mexico, responsible for an estimated 25% of all illegal drugs that enter the U.S. via Mexico. While this may appear good news (catching a big bad guy), Stratfor warns "this could spark a wave of violence throughout northwestern Mexico if internal shifts evolve into intra-cartel conflict."

Having already fled Kiev and his compound for the more hospitable eastern are of Ukraine, perhaps it was Tymoshenko's comment that...

• *UKRAINIANS OBLIGED TO BRING YANUKOVYCH BACK TO KIEV: TYMOSHENKO

...that was the final straw. Interfax is reporting that, for now, Customs have lost rack of the deposed leader...

• *UKRAINE CUSTOMS SVC STOPPED DEPARTURE OF PRESIDENT'S PLANE: IFX
• *UKRAINE CUSTOMS SVC SAYS YANUKOVYCH LEFT AIRPORT IN CAR: IFX
• *YANUKOVYCH HASN'T SHOWN UP AT OTHER CHECKPOINT: CUSTOMS TO IFX

Cue - webcams at Moscow International...

What are we going to do about those little monsters called children? They won’t be quiet, won’t sit still and won’t pay attention. They aren’t succeeding in school, and no matter how many drugs we pump into them, they don’t seem to get any better. To the surprise of no one, a new study has just been released showing that the staggeringly popular prescription drug Adderall is not having any positive effects on children’s grades, and in fact may be causing more kids to drop out of school. The finding should have been obvious, but don’t expect inattentive parents to stop buying the drug, and don’t expect greedy psychiatrists to stop handing them out like candy – for a hefty price. The problem is partially a cultural one, but it is also exacerbated by government attempts to meddle in education.

*TYMOSHENKO URGES PROTESTERS TO STAY IN INDEPENDENCE SQUARE "NOW UKRAINE IS A FREE UKRAINE:"

Yulia Tymoshenko was the heroine of the 2004 pro-Western Orange Revolution in Ukraine. But, as DPA notes, the two-time former prime minister was convicted in 2011 of abuse of power in connection with a gas deal with Russia (detailed below). This morning she was freed from prison in Kharkiv in eastern Ukraine Saturday after parliament voted for her release...

*TYMOSHENKO LEAVES HOSPITAL WHERE SHE WAS UNDER GUARD;: WEBSITE
*UKRAINE'S TYMOSHENKO SAYS SHE WILL RUN FOR PRESIDENT: ITAR TASS

and is set to address the protesters in Independence Square... (full chronology below) The US welcomed her freedom and is "closely monitoring"; Russia is displeased blaming opposition for violence. Meanwhile,

• *UKRAINE EX-INT MIN ZAKHARCHENKO CAUGHT TRYING TO FLEE BY BORDER SERVICE: IFX
  

Sometimes you just have to sit back, look at some charts, and say WTF...

Among the items plundered from Yanukovych's compound (after he fled to Kharkov)...

Fresh on the heels of the administration's decision to embed "government researchers" in the mainstream media to make sure they are doing their job properly (just as Maduro has decreed in Venezuela and punished CNN for?), we find out that the Department of Homeland Security planned to outsource the creation of a gigantic, comprehensive nationwide license plate database to a private corporation enabling license plate recognition "to catch illegal immigrants." However, after extreme pushback by privacy advocates, WaPo reports the DHS has cancelled the plan amid "a serious management problem within this DHS component that currently does not have a director nominated by the president."

With 328 (of the 450 seats) voting in favor, the Ukraine parliament has agreed to removed President Viktor Yanukovych:

*UKRAINIAN PARLIAMENT VOTES TO REMOVE PRESIDENT YANUKOVYCH
*UKRAINIAN PARLIAMENT VOTES TO HOLD EARLY ELECTIONS ON MAY 25

“Yanukovych, in an illegal manner, removed himself from his constitutional duties,” Turchynov says in chamber before vote. The Russians are not at all happy with Siluanov exclaiming these actions "pose a direct threat to Ukraine's sovereignty and constitutional order." As Martin Armstri0g warns, the nation will survive divided for there is far too much resentment to simply put this all behind and walk forward. Divide Ukraine along the historical language faultline and there is a chance to calm things down. Otherwise, this will flare up and take others with it.

It has been a busy night in the Ukraine.

In December 2008, two brief conversations from Ms Yellen and Mr Bullard appear to have set the scene for both the scale and focus of the Fed's actions over the ensuing years... ironically it was Janet Yellen's fear of a "rising" labor force participation rate and Jim Bullard's rapid realization that the US was "moving to a Japanese-style deflationary, zero nominal interest rate, situation at an alarming pace." Topics that now are quickly ushered away as nonsense by the mainstream economist crystal-ball gazers...

Many speak of China now as more assertive, confident and sure of its position in the world. And yet wealth and the hard power that has come with it seem in fact to have made China’s behavior more insecure, not less so. Insecurity above all is the more accurate description of China’s diplomatic character at the moment, rather than a newfound confidence.

Despite stockpiles imploding and prices exploding in the short-term, The U.S. Energy Information Administration (EIA) has predicted that natural gas production in the US will continue to grow at an impressive pace. Right now output is close to 70 billion cubic feet a day and is expected to reach over 100 billion cubic feet per day by 2040. The trend is likely to continue without hitting a geologic “peak”, and along with this trend will come new marketing opportunities for America. The following exclusive interview with OilPrice.com answsers some of the bigger questions...

Presented with no comment...

The US Bureau of Reclamation released its first outlook of the year and finds insufficient stock is available in California to release irrigation water for farmers. This is the first time in the 54 year history of the State Water Project. "If it's not there, it's just not there," notes a Water Authority director adding that it's going to be tough to find enough water, but farmers are hit hardest as "they're all on pins and needles trying to figure out how they're going to get through this." Fields will go unplanted (supply lower mean food prices higher), or farmers will pay top dollar for water that's on the market (and those costs can only be passed on via higher food prices).