update was released yesterday. For the third time in six months they
have reduced their forecast for the number of hurricanes this year. The
CS team is lead by William Gray. His group has the brain and computer
power to look at these complex issues. Their results over time are
about the same as your average sell side analyst, so-so.
Markets
fascinate me; I think it is their inherent unpredictability that sucks
me in. Weather is not that different. There is tons of data to look at,
but the outcome is often a surprise. I would not quibble with the CS
outlook. However, there is some contradictory information. For those
chart watchers out there, maybe some of you can see the error of my
observations.
CS hangs its hat on the improved outlook based on
two significant and observable conditions. Ocean temperatures and the
existence of the El Nino weather pattern. Big storms need warm water to
grow and the wind conditions resulting from El Nino tend to rip apart
hurricanes as they cross the Atlantic.
The following two
slides show pretty clearly that La Nina has become El Nino. These
photos and actual buoy data are what the scientists relied upon in
their recent conclusion that El Nino had re-established itself. What
remains to be seen is how strong the El Nino will become and how long
will it last. The average number of hurricanes has jumped in 1996 –2008
period versus 1944- 1995. I think the Vol for the El/La cycle has
changed significantly as well.
The National Weather Service has a web site
that tracks the changes in E/L conditions back to 1950 (Ocean Nino
Index, ONI). I present data from 1997 on. I do not consider stock data
that is pre 1997 either. We entered a new phase in both the weather and
the markets since that time. Volatility and thereby predictability has
changed markedly in the past decade. Most unscientific.
This
slide looks at the 1997-2001 changes in El to La Nino conditions. The
red is El the blue La, black is transition. Note the rapid change from
red to blue. Under the slide are pictures from NASA that describe
chronologically what is going on.
The
following looks at the information from 2001 to present. From 01-07 we
meandered back and forth with modest El Nino conditions. There were
several periods during this period of time that it was incorrectly
concluded that conditions were changing from El to La. In the fall of
2007 it became clear that La had re-established itself. Less than one
year later it went neutral and presumably the next entrant on this
chart will be red. Again below the slide of data are NASA pics. And
discussion. Note that these folks have been confused and wrong about
the status of E/L on a number of occasions.
2004
and 2005 were killer hurricane years. This occurred during a weak El
Nino. Just about what we are looking at today. Chart watchers please
tell me what is different from the 08-09 progression vs. the 04-05
progression.
Katrina was not a hurricane that formed off the
coast of Africa and made its way to NO. It was a “Homegrown”. It
started as a tropical depression in the Bahamas. It hit S. Florida then
crossed into the Gulf. In the slide below the areas in white show a
Cat. 5 hurricane with winds of 160 MPH. The water temperature in that
part of the Gulf was the high octane source of energy that made this
storm a monster.
The folks at CS have monster computers that drawn on thousands of data points. When they say, “Cooler water temperatures indicate a lower probability of severe hurricanes”
we just have to accept that as a fact. This data comes from buoys that
are all over the Gulf of Mexico. The following slide shows how many
there are. Each one produces a report that includes water temperature
every hour. There is a ton of data. I don’t have a Cray computer so I
look at just a few buoys. My favorite is buoy #42001. It is right in
the middle of that hot water that made Katrina. It is highlighted in
white.
In
August of 2009 the water temperature at 42001 is at near recent record
highs. It is currently 86.7 degrees. There is an incredible amount of
energy in this hot water. A historical look:
In
1999 the water at 42001 was hotter than it is today. By the end of the
month the heat fell because a category 3 storm (Brett) sucked the
energy out of the water. Brett was a bad one and started the higher
incidence of big storms. In 2004 the 8/1 numbers were low, they fell by
8/31 because two small storms passed. 04 and 05 were without precedent.
That water temperature was rising during both of those years in the 8/1
–31 period was a big contributor.
This
information is not at odds with the CS forecast. They certainly do not
exclude the possibility of a major storm this season. Based on the
04-05 experience when there was a large number of big storms while El
Nino conditions existed, it is not unlikely that homegrown tropical
depressions will form this year. If they pass by the hot waters in the
central gulf those homegrown could get very big.
As indicated
in the chart of water temperatures at Buoy 42001 it is possible that
the water temperatures could fall during August as smaller storms suck
up the energy. We are in a fairly critical 30-day period. All buoys are
RSS feeds if you are interested.
I am no weatherman, so my view
on this is irrelevant. That said, I think the conditions are ripe for
one or two big storms to form in the central gulf in the next two
months. If they spend enough time over the hot water they will grow.
The existence of El Nino may steer these storms north and east, away
from the oil/gas wells in the western gulf. The east coast of Florida
to NO are logical end points for these storms should they develop.
Related:
-Vol is a financial concept, but is can be applied to anything. The link to the ONI
index provides data back to 1950. It could be made to look like
relative price change data. Can anyone draw a Vol chart from this?
-Florida has $7.8b in its CAT insurance fund. Katrina cost $100 billion.
-There is hot water all over the Gulf right now.
Anecdotally, I'll confirm the extremely warm water in the Gulf of Mexico. I fished the Drambuie Key West Marlin Tournament, three days in late July. Yep, the water is usually pretty damn warm down here this time of year, typically in the 85-88 F degree range. This year though, sea surface temps in Key West Harbor were running 89.5-90.5 at 7am. Waters between shore and the reefline, 7 miles out, were over 90, hitting near 92 in some areas. You would normally expect to see cooler waters after passing to the south of the reefline dropoff, where depths drop from 30 feet to 100+ feet in a few tens of yards. Not this year. Another 6-7 miles south of the reefline is an area we call the "Ups and Downs" where the bottom topography is quite jagged, lots of peaks and valleys where the bottom rises from 700 to 550 feet in a long string of structure that runs east to west paralleling the reefline. You'll usually find cooler water here as the Gulfstream pushing to the east causes deep water to upwell as it goes over the Ups and Downs. Not this year, water temps there were averaging 89.8 degrees. Heading south from there you'll come across "Wood's Wall" where the depth drops from 900 feet or so, down to 2,000 feet in a half mile or less. The Wall which was first explored for Blue Marlin potential by Norman Wood back in the mid 1970's, is what put Key West on the map as a Marlin hotspot. The sharp drop there has always had a temperature break on the surface. Not this year, temps still way up 89.5-90.0.
We ended up 45 miles offshore, south of Key West at a place known locally as "The Hooters", if you saw the nautical chart you'd know how it got it's name, it's two protrusions of the 5,000 foot contour line that project shoreward and damned if they don't look like a pair of tits on the chart, cleavage, nipples and all.
Finally found cooler water there from the upwelling caused by a Gulfstream pushing east at 6 knots across the structure. Sea surface temp dropped all the way to 84.5 there.
We found fish. We won the tournament.
Tks for these comments. I am glad you won!
Take it from a Coloradoan; it is "CSU", not "CS".
27415 and Econofresh have hit on important issues.Gulf water temps and storms don't correlate well. And the Sun is important.
The Sun has had some record divergences recently: a multi-decade low in solar radio emmission, solar wind pressure, decade-plus low in irradiance and 679 days of no sunspots (normal lows around 485 days). If you are under 40, one day you will pray in vain for warming.
Factoid:
Carbon based gas (man made and natural) makes up <4% of total greenhouse gas. So why is Cabon based the focus? When they wrote the instruction book on Global Warming a.k.a. Climate Change someone made the decsion to exclude water vapor, which makes up >90% of greenhouse gas.
This year is the coolest because we are at the end of the 11year sun cycly.
Starting from next year, we will see a totally different picture!
Normally, it should be colder this summer and freezing in the winter. Here in Europe, it's still 33 degrees and well we missed out the winter. Again.
Check the NASA data about the new cycly
It is (almost) all about the winds. The water in the gulf this time of year is almost always hot enough to support a large storm. If the water temp gets up to 95 and the upper level winds are too strong the storms can't form. The water temp has a very poor correlation to storm count, and only a slightly better correlation to intensity.
Very interesting. Thanks Bruce
Why don't the Japanese have the best weather forecasters, they spend a ton on climate modelling?
The history channel says no hurricanes ever to hit US again. If GS can run the equity market, why not energize the ionosphere with radio waves? Full spectrum domination.
That's Impossible: Weather Warfare 1 /5 in HD - HAARP weapon
http://www.youtube.com/watch?v=jaNTmdwharw
http://www.haarp.net/
accuweather PRO gives you access to Joe Bastardi - who is probably the top hurriane guy out there -- it's $25/mth but they offer a 30 day free trial - it's worth a look
http://www.accuweather.com/proBenefits.asp?
also if you want to invest in the weather check out www.weatherbill.com
Joe Bastardi is the Jim Cramer of the weather world, BTW
beg to differ - more like Marc Faber - as in no one would pay for Cramer's crap. His track record ain't bad though his manner might be offensive to some
Surfers know this best... worst case is we have an El Nino nuetral winter, best is a minor El Nino. It won't be off the charts like 97/98. Shame really.
Forgot to add a link to the definative thread on the subject:
http://forum.surfermag.com/forum/showflat.php?Cat=0&Board=UBB1&Number=15...
Galleon is the one to watch. Scientist/surfer out of Texas.
Texas is suffering its hottest summer since 1980. Nuff said...
didn't i read a post on zh that there is some sort of way hedge funds bet on this stuff?
We here in SC are remembering Hugo, that was 20 years ago Sept. 1ish, I lived in the midlands and you talk about one nasty mofo, I wonder what the NO weatherman would've described it?
yes Weather derivatives
It's August, it's still early. El Nino has created some wind patterns that are not conducive to tropical activity. I've been watching almost daily, for very good reasons, and the wind patterns are obliterating any tropical wave activity that tries to spawn.
The Gulf waters can be hot as Hades, but that doesn't mean we'll have a nasty one. Winds aloft are the key. Those winds may or may not change. Eventually, they should move north and create a more favorable pattern for a hurricane or two. My guess, based on the patterns, is that we see the storms run up the Atlantic Coast vs into the Gulf this year - again based on the current El Nino pattern.
Disclosure: Sad but true, I have some ulterior motives for watching hurricanes, kind of like an ER doctor hoping for a quiet night but knowing the inevitable crash victim will be wheeled through the door - eventually.
A great read! But where is the financial buoy 42001? I have no clue, but am curious to hear ideas.
Well, it appears our African-American friends have found yet something else to be pissed about.
A black congresswoman (this would be Sheila Jackson Lee, of Houston), reportedly complained that the names of hurricanes are all Caucasian sounding names.
She would prefer some names that reflect African-American culture such as Chamiqua, Tanisha, Woeisha, Shaqueal, and Jamal.
I am NOT making this up!
She would also like the weather reports to be broadcast in 'language' that street people can understand because one of the problems that happened in New Orleans was, "that black people couldn't understand the seriousness of the situation, due to the racially biased language of the weather report".
I guess if the weather person says that the winds are going to blow at 140+ MPH, that's too hard to understand
I can hear it now: A weatherman in New Orleans says... Wazzup, mutha-fukkas! Hehr-i-cane Chamiqua be headin' fo' yo ass like Leroy on a crotch rocket! Bitch be a category fo'! So, turn off dem chitlins, grab yo' chirren, leave yo crib, and head fo' de nearest FEMA office fo yo FREE shit!
http://en.wikipedia.org/wiki/Lists_of_tropical_cyclone_names
As we can see on the listing for sheduled named storms for 2009: If we have 9 named storms in 2009 the 9th storm can be named Ida Ho. Hopefully this will suffice.
Nice, the racist hillbillies have found their way to ZeroHedge. I feared this day. Please go back to Marketwatch and Yahoo Finance where you belong. You can rant and whine all you want about the Gubment not sending your disability checks fast enough and no one will complain.
Can I criticize Obama, too? Or is that racist as well. He is uber black, after all, having gone to Harvard just like a lot of the inner city people I deal with on a daily basis.
Racist = Imitating how you think black people are
Not Racist = Criticizing Obama for handing the keys to the government over to corruption
Unfortunately, Sheila Jackson Lee is my Congressperson, and she IS a moron.
http://www.youtube.com/watch?v=8pyW6w5B7Aw
Funny shit -----spend $10 on gas to find 4.99 fried chicken
Shows that this country is going nowhere and the demarcation lines
are very wide.
Thanks for the laughter this am
HAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHAHA
+1000
Bruce,
I suspect that you, like I, are fascinated by both finance and weather because they are large, complex and yet measurable systems - it is this phenomenon, rather than the opportunity for making wealth, is what draws me most to the markets (and always makes me regret not having gone after a meteorology PhD when I had the chance to).
I've been worrying about the hot Carribbean since last January, when it first showed up in the NOAA forecasts, and while Wm Gray predicted back then that the hurricane season would probably be marginally above average at the time, he did predict that the number of Cat 3+ storms would be considerably higher than normal. What's more worrisome is that there are fewer storms this month than average, as Gray is now predicting, that means that the Carribbean should be a stew pot by mid Sept.
I'm not necessarily sure that it'll be a home grown storm, though. My brother is stationed in Iraq, and has been reporting daily about their having some of the worst sand-storms in more than fifty years right now. I'm not sure what precisely the linkage is between the Gulf cells and the Sahara cyclone is, but wouldn't be surprised if the one is both delaying the Saharan sandstorms now and likely to become instable and collapse by the end of August, which would then send a fairly massive jet of pent up air pressure across the Sahara just as the Carribbean water temperature peaks.
Hell, we're already having a perfect storm of a year, it'd only be par for the course.
Kurt - I agree with your first paragraph, only my perspective is the inverse of yours: I am a meteorology PhD that now somewhat regrets not going after a finance degree! I am obsessed with both weather patterns and financial markets. Anyway, back to the topic...
The hurricane forecasts are lower this year because the tropical Atlantic ocean temperatures during late spring and early summer were as cold as they have been since 1994. We have not yet had a named storm, which represents one of the latest starts to a season on record (the latest start in modern history was Aug 29 in 1977). Since we have had no tropical activity to stir up or mix the oceans, the ocean temperatures have been allowed to warm considerably as the post notes. Indeed, there is some evidence that late-starting seasons often start with a bang (see Andrew 1992).
The post mentions 2005 as repudiation for the "El Nino = weak season" idea, and he is partially correct. Whether we have an El Nino or La Nina is not nearly as important as how warm the tropical Atlantic ocean temperatures are. In 2005, ocean temperatures were at an all-time high, much, much warmer than they are now.
Love to see posts like this on zerohedge!
"Love to see posts like this on zerohedge!"
I also. I've been a hurricane watcher since Camille.Went to school where the Eye
of Camille made land. I consider this a pre season wake up. I'll brush off my charts and sites. Look forward to talking about the Cat 5 storm in the GOM this year.
What I look for: Inland droughts (they seem to attract storms) and built up coastal areas (they haven't had a "big one" in a while.
Good luck!
cool. i'll be swimming there this weekend - i'll let you know how warm the water is. since we have gulf front property on the panhandle this report is interesting. replacing dunes and stairs to the beach was getting old. as for the data provided, how reliable is it? if one of the forecasts can cause the price of oil to rise or fall significantly, is it possible that they could be "influenced" via "contributions" or "funding"? a legitimate question imo. your independent report is appreciated. well done.
How great for you!