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Daniel Yergin’s “The New Map”: How Rising Asia Will Ensure the Future of Fossil Fuels

Published by Anonymous (not verified) on Fri, 22/01/2021 - 12:27pm in

Published in Nikkei Asia 15/1/2021

“Over 80% of the world’s people have never been in an airplane. ‘Flight shaming’ may be a social mode in Sweden, population 10 million, but China, population 1.5 billion, is building eight new airports a year.”

That quotation is typical of the tough-minded, realistic approach that Daniel Yergin adopts in “The New Map: Energy, Climate and the Clash of Nations”. The book appears with perfect timing. President Joe Biden has pledged to take the United States into the Paris agreement on climate change and is expected to put green investment schemes at the centre of his economic recovery programme.

The EU had already committed itself to a zero net carbon economy by 2050, as has Boris Johnson’s UK government. Japanese Prime Minister Yoshihide Suga followed suit in late December. The governments of the wealthiest countries in the world are now solidly aligned with the green agenda.  What could possibly go wrong?

Quite a lot, in Yergin’s view. To hit the target, these countries (GDP per head of $40,000-$60,000) would need to see their per head emissions fall to the same level as India’s (GDP per head of $2,000). These are tremendously ambitious goals.

Japan has followed the UK in proposing to ban sales of standard ICE (internal combustion engine) automobiles, by the mid-2030s in Japan’s case. In an unusually blunt response, Akio Toyoda, CEO of Toyota, stated that such a restriction risked driving car manufacturing out of Japan while doing nothing for emissions. Indeed, unless the grid itself is de-carbonized, electrification of the car fleet will achieve little.

Akio Toyoda recreates the Lexus "champagne" ad. Akio Toyoda recreates the Lexus “champagne” ad.

Change in the U.S., with its high level of vehicle ownership, is far more challenging. The fleet of 280 million vehicles is currently 99% ICE-powered. One fifth is over 16 years old, a proportion that has been rising steadily due to quality improvements. Without a game-changing policy intervention, many ICE vehicles bought this decade will still be in service in the 2040s.

Any such intervention would incur immense costs at the very time the economic wounds of the Covid-19 crisis need to be healed. Is Joe Biden ready to raise fuel taxes to European levels and offer more subsidies to the usually wealthy buyers of battery-powered cars? If he does, America’s 3.5 million truck drivers are unlikely to be amused.

British Prime Minister Harold Wilson once declared that a week was a long time in politics. From the perspective of today’s politicians, 2050 probably seems like the far future. But in terms of a full-scale energy transition, the creation of the necessary infrastructure, the safety testing, delivery and commercialization of new technologies, it is just around the corner.

Daniel Yergin is an insider’s insider. Pullitzer prize winner, trustee of the Brookings Institute, board member of the Council of Foreign Relations, member of the U.S. Secretary of Energy Advisory Board under the past four presidents – he knows the issues inside out, and most of the major players too. His reputation is based on his intimate knowledge of the oil and gas industry and analysis of the geopolitics of energy.

Most of “The New Map” is a lively description of recent events. It features a colourful cast of characters that includes Vladimir Putin, Xi Jinping, Saudi leader Mohammed bin Salman, Uber’s Travis Kalanick, Tesla’s J.B. Strauber, shale oil pioneer Harold Hamm and Malcolm McLean, the man who invented the shipping container, thereby ushering in an era of explosive growth in world trade.yergin2

It is the last two chapters that are the most important and most controversial. Yergin’s main scenario is that the global fleet of planes will double over the next thirty years; that oil consumption will hardly fall at all in absolute terms, although its share of total energy consumption will decline significantly; that the number of ICE-powered vehicles will be more or less unchanged, although over half of the new cars sold in the world will be EVs.

“Oil will maintain a pre-eminent position as a global commodity, still the primary fuel that makes the world go around,” he declares. “Some will simply not want to hear that. But it is based on the reality of all the investment already made, lead times for new investment and innovation, supply chains, its central role in transportation, the need for plastics from the building blocks of the modern world to hospital waiting rooms, and the way the physical world is organized.”

Unsurprisingly, Yergin has little time for the radicals, symbolized by teenage activist Greta Thurnberg, who want to ban fossil fuels right away. He quotes the response of David Swensen, legendary head of the Yale endowment, when faced with students’ demands to disinvest from the companies involved. “If we stopped producing fossil fuels today, we would all die…We wouldn’t have food. We wouldn’t have transportation… We wouldn’t have clothes.”

Yergin is no climate change denier, nor does he ignore the disruptive new technologies that are driving down the cost of renewables. He believes the energy transition is real and that breakthrough technologies such as hydrogen power have great potential.  What he disagrees about is the timescale. And the basis of his scepticism is the changing power balance in the world, specifically the rise of Asia.

China overtook the U.S. as the world’s largest energy consumer in 2009, and now accounts for 25% of world consumption. Some 85% of that is generated by fossil fuels, overwhelmingly coal. It has been adding three coal-fired plants a month.

Long-term energy security is crucial in the thinking of the Chinese leadership and plays a major part in the rapprochement with Russia. As Yergin observes, “a relationship that was once based on Marx and Lenin is now grounded in oil and gas.” China has made $80 billion of pre-payments to Rosneft, a state-controlled Russian energy company, for oil supplies to be delivered over the next twenty five years. It also financed the now functional 1,865 mile Power of Siberia natural gas pipeline, part of a mega-deal worth $400 billion over 30 years that cements the relationship between the two nations.

power of Sibera

China is indeed a leader in EVs, but the need to keep living standards rising– a must for the Chinese Communist Party – suggests that fossil fuels will remain the dominant source of electricity.

India, destined to become the world’s most populous nation by the end of this decade, is at a much earlier stage of development. For a large part of the population – 300 million live on the equivalent of $1.25 a day –  energy transition means moving away from pollutant-spewing wood and agricultural and animal waste.

The target is “to usher in a gas-based economy”, in the words of Petroleum Minister Dharmendra Pradhan. Currently, India has 37 cars for every thousand people. China has 160, Brazil 208, the EU 520 and the U.S. 867. In the sub-continent, motorization has barely begun.

If the G7 nations still ruled the world, you could colour the year 2050 a deep shade of green. But geopolitical power is flowing to countries that place significantly lower on Maslow’s hierarchy of needs. Until hardcore environmentalists make converts of Narendra Modi, Xi Jinping and the leaders of the emerging world, Daniel Yergin’s highly-informed scepticism seems well justified.

 

 

Scotty From Marketing Launches Only Fans Account

Published by Anonymous (not verified) on Fri, 01/01/2021 - 8:00am in

Tags 

Business, coal

Australian Prime Minister Scotty from Marketing has increased his online presence by this week launching a new Only Fans fan page, whereby supporters can receive pictures of the PM, for a fee.

”I was sitting around with a few of my mates the other day, just kicking some ideas around, when one of them suggested we get onboard with Only Fans,” said Prime Minister Scotty. ”After a few laughs were had, I got to think about it a bit more and thought, why not?”

”After all, I have a backlog of photos of me doing various daggy Dad type of things, so why not get them out there to the adoring public?!”

When asked why he was seemingly silent over the Christmas period, during which time his home state was plunged in to further Covid chaos, the Prime Minister said: ”I reject the premise of your question.”

”I have been there everyday in the trenches taking photos of myself and my family doing everyday things that I hope will inspire everyday Australians.”

”Now, if you’ll excuse me, I’m off to Engadine Maccas to make sure that the cleaning staff are socially distancing.”

Mark Williamson

@MWChatShow

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Government Announces New Welfare Initiative: MineKeeper

Published by Anonymous (not verified) on Thu, 17/12/2020 - 9:09am in

The Australian Government has reacted swiftly to news that China will no longer be accepting the country’s coal by setting up a new welfare initiative, Minekeeper.

“The very second I heard that our coal was not being taken I got on the blower to Treasury and said do what needs to be done to keep Twiggy and Gina going,” said Prime Minister Scotty from marketing. “My Government is a quick acting Government.”

“A Government that looks after those most in need.”

When asked why his Government was so quick to look after the mining industry as opposed to their glacial reaction to the down fall of the entertainment industry, the Minister said: “I reject the premise of your question.”

“My Government has always been there for the entertainment industry. Why just the other day one of my Ministers chucked some loose change in a buskers hat.”

“Coal miners can’t sell their product on the streets you know.”

“Now, if you’ll excuse me, I’m off to Gina’s end of year soiree. Apparently the catering will be better than Engadine Maccas, woo hoo.”

Mark Williamson

@MWChatShow

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TRADE WARS: Kmart Australia Retaliates By Removing All Chinese-Made Goods From Its Shelves

Published by Anonymous (not verified) on Thu, 17/12/2020 - 8:50am in

Kmart says it will do its bit to support Australia in the escalating trade war with China, by committing to remove all Chinese-made items from its stores.

A spokesperson for the company said it was an important symbolic gesture. “It’s something small we can do to show our support. We started by removing any clothing made in China, then homewares, sheets and towels, electrical appliances, toys, underwear, maternity wear, belts, hats and sporting goods. Then we moved to Christmas decorations, books, nappies, pet items, handbags, footwear, stationery, swimwear and sleepwear.

“From there it was just a matter of removing the shelves, the light globes, the flooring, the shopping trolleys and the curtains on the change rooms and we were done. You can hardly notice a difference at all”.

He said there was still a great range of items in store. “All of the self-serve checkouts were made in Japan. So come in and take a look”.

Kmart rejected claims it had put all of its eggs in one basket. “Our baskets are actually made in China, so no, we haven’t put anything in a basket”.

Other retailers such as Target, Big W and Bunnings are expected to make similar announcements soon.

What stock markets tell us about the covid-mania.

Published by Anonymous (not verified) on Fri, 11/12/2020 - 2:46am in

Stock markets give us a glimpse what people with money have deduced about world events before they happen. Investors can make mistakes, sometimes terrible mistakes, but they are honest mistakes: you don’t buy a stock at a 100 if you actually honestly believe that same stock will only cost 50 next week. So whilst you might be wrong in following a herd, or you may be mislead, the price of stocks still reflects an honest valuation at that moment. This makes stock markets very useful for reading political and economic events, though interpreting them requires a lot of knowledge of the possible influences on those prices. I want to tell the story of how the markets seem to have read the covid-mania of 2020 in 3 graphs, where the last one is the most depressing one.

The first graph shows the stock value of Airbus, a European company that makes airplanes. The restrictions on travel throughout the world decimated the industry it made planes for, such that the number of orders for new planes dropped from about a 100 a month to nothing.

This graph first off shows you the whopping 65% drop from the end of February to March 18th. Thus the markets in early March saw coming that governments were going to make life tough for the airline industry, long before many governments actually instigated lockdowns or travel restrictions. The market analysts were quicker than me, because I only started to really see what was coming around March 10th. The graph thus shows you the uncanny speed with which financial analysts are reading future political decisions.

You see an uptick in June when restrictions were eased in many countries and the markets had some reasonable hope that the covid-related travel-restrictions were going to come to an end soon, though not a huge amount of hope because the uptick was ‘only’ 20% or so. That uptick probably also had to do with the fact that governments were bailing out their airline companies, so investors knew bankruptcy was not going to happen. Airbus was too big to fail.

You see the drop in October when markets realised Europe and some US states were going to lock down again, even though that only actually happened a month or so later. The uptick in November then probably reflects the fact that markets started to believe vaccines would actually come in much earlier than previously thought and would allow some degree of normalisation, though still estimating that Airbus was worth 30% less than at the start of 2020.

So the Airbus stock price tells you the standard story of what forward-looking financial analysts were thinking at different moments about the political economy of the pandemic, pre-guessing lockdowns, reduced restrictions, a second lockdown, and vaccines. What you also see in the strong price changes though is that they did not see things coming way in advance, but more like a few weeks in advance, and that they got some things ‘wrong’ in a longer-run sense: if you’d had known on March 1st what was going to happen with lockdowns, you would have made a killing betting on a big downturn the next two weeks. If you’d have known markets would believe in vaccines in November, then you could have made a killing by buying up this stock in August. Hence, in many ways, the Airbus stock price is a standard, but beautiful example of how stock markets tell you of the reality and limitations of forward-looking information in prices.

The second graph I want to talk about is that of the NASDAQ, which is the main stock market for the US Big Tech companies.

This graph tells you a very different story. Just as with Airbus, there was a big general crunch early March of around 30% of the initial value, which was less severe than with airbus that lost 65% of its value. So there is the same story of how financial analysts predicted the lockdowns, but it also shows they predicted that the policies would hurt Big Tech less than it would hurt the airline industry. Still, they anticipated covid-mania would be bad for Big Tech.

The second big thing about the graph is the continued rise from April till about August, increasing the index 20% above February prices. So unlike Airbus that was still 50% down in August, the markets had learned that covid-policies were actually really good for Big Tech, which was not anticipated but came as a surprise. Big Tech was the big facilitator of covid-mania, something the markets started to realise around late April, so pretty quickly. They started to notice the increase in online shopping, online job search, online socialising, online everything. What they also learned was that governments were not stopping it by hampering home deliveries or using the opportunity to muscle in on Big Tech monopolies.

The drop in October is relatively small and probably some kind of correction on the assessment of how well things were going for Big Tech. The blip down at the very end is due to the US authorities talking about breaking up Facebook and perhaps other Big Tech companies.

So the story of the Nasdaq tells you that the benefits Big Tech got from covid-policies were unanticipated but very large (almost a doubling since the end of March). This of course tells you exactly why Big Tech is so keen on extending lockdowns and the covid-mania via censorship and disinformation: long may the good times last for them! And the markets clearly anticipate there will not be much of a backlash.

Whilst the second graph is depressing enough, the third one is really nasty in my view. It’s the story of Starbucks, the coffee chain.

Now, this stock first behaves the way you’d now expect: just like Airbus, coffee chains are really hampered in their business by the lockdowns and other covid-mania policies, so the markets anticipate a big drop in business, and thus we see a 40% drop in share value early March. The downturn is also what the company itself reports, flagging in June that it had over 3 billion dollars less in sales, and that is just from the preceding quarter.

The first surprise is the uptick in April-May, probably related to government subsidies which big companies are good at securing.

The depressing bit is the large uptick after August: an increase of about 30% coinciding with the new lockdowns, making the company worth 10% more mid December than in February, even though turnover is still highly depressed and whilst it will probably take take years for coffee-fueled office life and tourism to return to normal. What is going on, you might wonder? Why are we not seeing a lower valuation for Starbucks at the end of such a terrible year for them, just like we saw for Airbus?

The Financial Times tells us the likely reason: many of the smaller chains (like Nero) and independent coffee shops are going bankrupt, leaving Starbucks a bigger market share. This is probably also why by now, the Dow Jones index in the US is above its pre-March level and why the Indian stock-market (the Nifty50) is up almost 15% on the start of this year despite a drop in GDP of over 10%: big business is now expected to gain from the demise of small business that is squashed by the covid-policies. This too was not foreseen early on.

I find this quite depressing because in a way I am looking at the demise of independent and smaller businesses in this graph, with the bigger companies soaking up the additional demand. It’s the modern version of the enslavement of a once free population: from independent coffee shop owner to an employee who will have to clock in hours, abide by company procedures, and do tonnes of corporate responsibility training. From proud workers to schmucks who have to smile on demand and sign non-disclosure contracts they don’t understand.

So there you have the basic story of the covid-mania in three stocks: a hit of 65% to the travel industry that became 30% when government subsidies and vaccines softened the blow; the unexpected gains of Big Tech making them have an interest in continued covid-mania; and the decimation-by-policy of the independent smaller businesses leading to gains among the big boys, heralding a more feudal and more unequal future for the vast majority. Let’s hope the markets are wrong about that.

Regional Australia Braces For Invasion Of Hideous Oiks Who Usually Holiday Overseas

Published by Anonymous (not verified) on Mon, 30/11/2020 - 7:00am in

Residents of small resort towns all over Australia are making disaster plans to deal with the influx of posh wankers who normally choof off overseas for a holiday at this time of year.

“We’ve survived drought, bushfires, floods and coronavirus but I have no idea how we are going to deal with pushy Bondi Junction mums demanding gluten free breakfasts for Chloe, Sophie and Noah,” said exasperated Tuross Heads caravan park owner Barry Millard. “We are definitely not going to provide disposable booties to wear in the showers. If they don’t want to get tinea they can wear thongs like everyone else and slather their feet in Lamisil.”

“I tried to book my regular camping spot in Tea Gardens this summer and was told that it’d been booked out six weeks ago to some mullet who usually flies out to Whistler or the Maldives for Christmas,” sighed Merrylands dad Jason Chippy. “Guess we’ll have to set up the tent in the backyard and buy some yabbies from the local fisho so we can pretend we’ve been out on the bay. At least we won’t have to get Trev from next door to feed the dog.”

Makers of novelty number plates for pushbikes have reported a downturn in demand from coastal gift shops for Mitchells, Jais and Tanitas, and a huge rise in demand for Oscars, Hamishes and Charlottes.

“We’re expecting a massive demand for Paddlepops, Chiko rolls and all this other crap food that posh people imagined everyone ate around here about thirty years ago,” said Bendalong café owner Bev Sunburn. “There’s going to be a lot of disappointed Tesla drivers when they find out that we serve the same caramelised vegan banana pancakes and acai bowls they get at their local café in Waverley.”

Peter Green
http://www.twitter.com/Greeny_Peter

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Unsanitized: What Does the Election Mean for Stimulus?

Published by Anonymous (not verified) on Fri, 06/11/2020 - 9:21pm in

First Response I am returning to the coronavirus beat today, and look what’s here to greet me: 100,000 new cases in a day, the first time that happened. I’d have thought it’d be more poetic for that to occur on Election Day, … Continue reading

The post Unsanitized: What Does the Election Mean for Stimulus? appeared first on BillMoyers.com.

Coffee Company Donates 20% of Profits to Philosophy Education

Published by Anonymous (not verified) on Tue, 03/11/2020 - 7:30pm in

A new roaster and seller of coffee beans, A Posteriori Coffee Co., donates 20% of its profits to support philosophy programs for children in kindergarten through high school and to organizations that provide philosophical resources to the public.


Empiricist philosopher John Locke is featured in the logo of A Posteriori Coffee Co.

The company was launched just last week. Its founder, Will Misback, graduated from the University of Pittsburgh with a bachelor’s degree in philosophy. He writes:

In the course of completing my degree, I experienced the world of good philosophy can do for a person’s critical thinking skills. I became confident in my ability to reason about topics and synthesize my thoughts about them through the mediums of both speech and writing. The benefits of this change extended to more areas of my life than just academics. To put it succinctly, I believe my degree in philosophy undoubtedly changed my life for the better.

So Mr. Misback decided to combine his appreciation of philosophy with his appreciation of coffee (“I credit much of the work I did to achieve my philosophy degree to the energy and productivity that coffee imparted to me”) to create A Posteriori Coffee Co., and to donate a fifth of his firm’s profits to youth education in philosophy:

We believe that philosophy ought to be an integral part of everyone’s education. Philosophy is among one of the best ways to improve one’s critical thinking, reading comprehension, writing ability, and ability ot reason effectively. Unfortunately philosophy is often overlooked as a part of educational curricula for students before they reach university. To this end we seek to increase all people’s access to philosophy, especially K-12 students.

The organizations that will be receiving the company’s donations currently include Philosophy Learning and Teaching Organization (PLATO), the Stanford Encyclopedia of Philosophy (SEP), and the American Philosophical Association (APA). Mr. Misback says, “If you have suggestions for expanding upon the list below, perhaps you are a member of another philosophy centered nonprofit organization seeking funding, we would love to hear from you. Please get in touch with us at will@aposterioricoffee.com.”

The coffees are ethically traded and come in several varieties. Here are some (note the names):

You can learn more about the company and check out its offerings here.

The post Coffee Company Donates 20% of Profits to Philosophy Education appeared first on Daily Nous.

News Corp Folds After Running Out Of Things To Criticise Victoria About

Published by Anonymous (not verified) on Tue, 27/10/2020 - 9:51am in

Rupert Murdoch’s News Corp will close its doors today, after editors conceded there was literally nothing for them to write about.

“We were putting together today’s issue of our papers and we realised that, without 89 think pieces shitting on Victorians, we really didn’t have any content,” a spokesperson for the organisation said.

“We tried to write a few pieces about how Melbourne’s zero cases is actually a lot worse than it seems. And Andrew Bolt put together a scathing op-ed on why Victoria would actually have less than zero cases if it wasn’t for multiculturalism. But in the end it all just didn’t seem worth it”. 

The spokesperson said that without 280 pages criticising Melbourne, all they were left with was a puff piece about Scott Morrison building a pergola. “It was a great piece, but we decided that it would be easier to just print it as part of the Bunnings catalogue, rather than pretending it’s actually news”.

News Corp’s printing facilities will now be repurposed to print Liberal Party flyers, with the company’s management promising staff they would hardly notice any change.

The 2020 Shovel Annual is now on sale!

Australia Post CEO Says Cartier Watches Were Posted In May, But Haven’t Arrived Yet

Published by Anonymous (not verified) on Fri, 23/10/2020 - 1:45pm in

Australia Post CEO Christine Holgate has told a Senate hearing the Cartier watches she bought for senior executives as a bonus were actually posted in May and should arrive soon.

Under examination from the Senates Estimate Committee, Ms Holgate said she was initially told the watches had been left in a safe place, but had since been made aware that they were returned to a local Post Office in inner Melbourne and then subsequently sent to a depot in Queensland.

“We find the most efficient way to get a parcel from the Melbourne CBD to Carlton North is via Brisbane,” she said.

Ms Holgate said the executives would have received a card saying their gifts had been returned to the nearest Post Office. “They would have then had forty-three minutes to pick them up, before they were returned to the depot. The good news is, I’m told they will be re-delivered and will be arriving at some point between 25th October and 28th December”.

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By Sarah Yates

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