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EU can shut off power supplies if UK tries to seize control of fish stocks, small print of deal reveals

EU can shut off power supplies if UK tries to seize control of fish stocks, small print of deal reveals

Cables under Channel meet 8 per cent of demand – raising threat of higher prices and possible blackouts.

The EU has secured the ability to shut off gas and electricity supplies if the UK tries to seize control of disputed fish stocks in future, experts are warning.

The sanction – which would hike prices and possibly trigger blackouts – makes a mockery of the prime minister’s claim to have “taken control” of British waters in his trade agreement, they say.

The little-noticed clause in the vast 1,255-page text allows Brussels to kick the UK out of its electricity and gas markets in June 2026, unless a fresh deal is agreed.

The date set is – deliberately – the same as for the review of fishing rights, when Mr Johnson has insisted the UK will finally grab a large share of stocks, having failed to do that in his agreement.

The Institute for Government said Brussels had been determined to secure a connection “between energy and fish” in the negotiations that finally concluded on Christmas Eve.

“It seems that, in the weeds of the deal, they’ve succeeded,” Maddy Thimont Jack, the IfG’s associate director, told The Independent:

“By including annual negotiations on energy from 2026, it would be very easy to leverage access to the EU’s energy market in the annual talks on fish – also starting in 2026.

“This is just another reason why the UK will likely struggle to take back control of any more of its waters in the years to come.”

Losing power supplies could have a significant impact on the UK, which brings in about 8 per cent of its demand through huge power cables under the Channel.

…click on the above link to read the rest of the article…

 

From a Hamilton Moment to Perpetual Debt Slaves: This Is the True Face of the EU

From a Hamilton Moment to Perpetual Debt Slaves: This Is the True Face of the EU

Over the summer while the U.S. was mired in the worst kind of color revolution with race riots, economic shutdowns and the worst kind of divisive politics, the European Union was celebrating its great achievement.

A seven-year budget and COVID-19 bailout package that was heralded as German Chancellor Angela Merkel’s “Alexander Hamilton Moment.” Because that legislation, meant to be the cornerstone of Germany six-month stint as the president of the European Council finally granted the European Commission the ability to issue debt, collect taxes and disburse funds.

That would be the way the COVID-19 relief funds would be raised and distributed. It was the first moment of fiscal integration under a central EU body that would bypass the individual member states as the means by which to raise capital.

It would be the first step in the process of consolidating debt issuance and euro creation under the control of Brussels, rather than continuing to carry out the fiction of individual sovereign debt.

The euro is a fatally flawed currency because of this and if it is to survive deeper into the 21st century having only one central issuer of it, the EU itself via the European Commission and the European Central Bank, with one aggregated risk profile (interest rate) is necessary.

The current leadership of the EU was put in place to make this happen on powerful Germany’s watch. And in July is looked like it was done. The markets loved it. The media hailed Merkel as the great leader of Europe. Some countries balked, the so-called Frugal Five, but eventually they signed off on the draft legislation once they were no longer directly on the hook for any more wealth transfers from them to perpetual problem children like Italy, Greece and Spain.

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The curse of ‘white oil’: electric vehicles’ dirty secret

Brine pools and processing areas of the Rockwood lithium plant on the Atacama salt flat, Chile. Photograph: Iván Alvarado/Reuters

The race is on to find a steady source of lithium, a key component in rechargeable electric car batteries. But while the EU focuses on emissions, the lithium gold rush threatens environmental damage on an industrial scale.

Even before the new mine became the main topic of village conversation, João Cassote, a 44-year-old livestock farmer, was thinking about making a change. Living off the land in his mountainous part of northern Portugal was a grind. Of his close childhood friends, he was the only one who hadn’t gone overseas in search of work. So, in 2017, when he heard of a British company prospecting for lithium in the region of Trás-os-Montes, Cassote called his bank and asked for a €200,000 loan. He bought a John Deere tractor, an earthmover and a portable water-storage tank.

The exploration team of the UK-based mining company Savannah Resources had spent months poring over geological maps and surveys of the hills that ripple out from Cassote’s farm. Initial calculations indicated that they could contain more than 280,000 tonnes of lithium, a silver-white alkali metal – enough for 10 years’ production. Cassote got in touch with Savannah’s local office, and the mining firm duly contracted him to supply water to their test drilling site. The return on his investment was swift. After less than 12 months on the company’s books, Cassote had made what he would usually earn in five or six years on the farm.

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EU Polices on Farming will Create a Famine

 

The EU is indeed playing into our model which has been projecting this would be a commodity wave built on food shortages. They will indeed contribute to worldwide famine and they have been supported by Bill Gates which seems to actually play into his desire to reduce world population. Food prices will rise and the poor will be left starving. This will contribute to the rising civil unrest much as the food shortages led to the French Revolution.

Is the Green Deal a card shuffle trick?

Is the Green Deal a card shuffle trick?

(NOTE; this is not an analysis of the US New Green Deal, it is about the “green growth” narrative with the European Green Deal as the point of departure.)

The European Green Deal is a ”growth strategy that aims to transform the EU into a fair and prosperous society, with a modern, resource-efficient and competitive economy where there are no net emissions of greenhouse gases in 2050 and where economic growth is decoupled from resource use.”

There are reasons to discuss if the vision of the European Green Deal is desirable: why should it be a goal to be “competitive” or ”modern”? But let’s buy into the narrative and ask: is the vision possible? Is ”green growth” as expressed in the Green Deal or the Sustainable Development Goals even possible?

In a recent paper in New Political Economy, Jason Hickel and Giorgios Kallis do a good job in illuminating many of the discussions and concepts involved in the Green Growth debate. Their overall conclusion is that ”green growth theory – in terms of resource use – lacks empirical support”.  They note three caveats of their own conclusions. First, it is possible that ”it is reasonable to expect that green growth could be accomplished at very low GDP growth rates, i.e. less than 1 per cent per year”. Second, conclusions are based on the existing relationship between GDP and material throughput, but one might argue that it is theoretically possible to break the existing relationship between GDP and material throughput altogether. Third, the aggregate material footprint indicator obscures the possibility of shifting from high-impact resources to low-impact resources. Meanwhile, Hickel and Kallis also point out that material footprints needs to be scaled down significantly from present levels; to be truly green, green growth requires not just any degree of absolute decoupling, but rapid absolute decoupling.

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“Prolonged Period of Risk to Institutional and Retail Investors of Further – Possibly Significant – Market Corrections”

“Prolonged Period of Risk to Institutional and Retail Investors of Further – Possibly Significant – Market Corrections”

European Market Regulator flags big issues, including the “decoupling of financial market performance and underlying economic activity.”

The European Securities and Markets Authority (ESMA) warned of a “prolonged period of risk to institutional and retail investors of further – possibly significant – market corrections and very high risks” across its jurisdiction.

“Of particular concern” is the sustainability of the recent market rebound and the potential impact of another broad market sell-off on EU corporates and their credit quality, as well as on credit institutions.

The “decoupling of financial market performance and underlying economic activity” — the worst economic crisis in a lifetime — is raising serious questions about “the sustainability of the market rebound,” ESMA says in its Trends, Risks and Vulnerabilities Report of 2020.

Beyond the immediate risks posed by a second wave of infections, other external events, such as Brexit or trade tensions between the US and China, could further destabilize fragile market conditions in the near term.

From a long-term perspective, the crisis is likely to affect economic activity permanently, “owing to lasting unemployment or structural changes, which might have an impact on future earnings.” The increase in private and public sector debt could also give rise to solvency and sustainability issues.

In corporate bond markets, spreads have narrowed but they remain well above pre-crisis levels, owing to heightened credit risk and underlying vulnerabilities related to high corporate leverage. There was also a wide divergence across sectors and asset classes in April and May. Across non-financials, the automotive sector suffered the largest decline, followed by the energy sector.

…click on the above link to read the rest of the article…

An appropriate European Union response to tensions in the Eastern Mediterranean

An appropriate European Union response to tensions in the Eastern Mediterranean

If the European Union can mediate effectively to resolve current Greek-Turkish tensions over energy in the Eastern Mediterranean, it could also provide an opportunity to tackle more deep-rooted problems.

The European Union is seeking to mediate in a naval confrontation on its doorstep, in the Eastern Mediterranean, which involves NATO partners Greece and Turkey, as well as EU member Cyprus. EU foreign ministers are discussing the issue and, without de-escalation, sanctions against Turkey could be implemented. But so far, the two most powerful EU nations have adopted a ‘good cop, bad cop’ approach that conveys different and confusing messages – and has not prevented escalation. Chancellor Angela Merkel, with the added authority of holding the EU’s six-month revolving presidency, has launched a German initiative to prevent escalation, reduce tensions and overcome longstanding conflicts. But French President Emmanuel Macron, while not eschewing mediation, has opted for a show of force, sending French naval vessels into disputed waters to counter the presence of Turkish warships.

Deep-rooted dispute

The dispute is ostensibly over ownership of offshore gas deposits and the delimitation of 200-mile exclusive economic zones (EEZs).

Turkey has sent exploration vessels and warships into waters claimed by Greece and Cyprus and begun drilling for gas. Despite its 1,600 kilometre Mediterranean coastline, Turkey is the only Eastern Mediterranean state without internationally recognised rights to offshore resources in the area because nearby Greek islands and Cyprus have secured the right to generate EEZs under the United Nations Convention on the Law of the Sea (UNCLOS). Turkey is one of fifteen UN members that is not a party to UNCLOS, and Ankara insists that Turkey’s continental shelf gives it ownership rights that take priority over the UNCLOS-backed claims of Cyprus and Greece.

…click on the above link to read the rest of the article…

Post-Brexit Agrochemical Apocalypse for the UK?

Post-Brexit Agrochemical Apocalypse for the UK?

The British government, regulators and global agrochemical corporations are colluding with each other and are thus engaging in criminal behaviour. That’s the message put forward in a new report written by environmentalist Dr Rosemary Mason and sent to the UK Environment Agency. It follows her January 2019 open letter to Werner Baumann, CEO of Bayer CropScience, where she made it clear to him that she considers Bayer CropScience and Monsanto criminal corporations.

Her letter to Baumann outlined a cocktail of corporate duplicity, cover-ups and criminality which the public and the environment are paying the price for, not least in terms of the effects of glyphosate. Later in 2019, Mason wrote to Bayer Crop Science shareholders, appealing to them to put human health and nature ahead of profit and to stop funding Bayer.

Mason outlined with supporting evidence how the gradual onset of the global extinction of many species is largely the result of chemical-intensive industrial agriculture. She argued that Monsanto’s (now Bayer) glyphosate-based Roundup herbicide and Bayer’s clothianidin are largely responsible for the destruction of the Great Barrier Reef and that the use of glyphosate and neonicotinoid insecticides are wiping out wildlife species across the globe.

In February 2020, Mason wrote the report ‘Bayer Crop Science rules Britain after Brexit – the public and the press are being poisoned by pesticides’. She noted that PM Boris Johnson plans to do a trade deal with the US that could see the gutting of food and environment standards. In a speech setting out his goals for trade after Brexit, Johnson talked up the prospect of an agreement with Washington and downplayed the need for one with Brussels – if the EU insists the UK must stick to its regulatory regime. In other words, he wants to ditch EU regulations.

…click on the above link to read the rest of the article…

What? Default? Where? Dollar?

What? Default? Where? Dollar?

It won’t come as a surprise to anyone that the first half of 2020 has brought, among many other things, renewed calls for the demise of the US dollar. It’s been pretty much a non-stop call for over a decade now, and longer. But this time, like all previous ones, I’m thinking: I don’t see it. I guess my first question is always: please explain why the dollar would collapse before the euro does.

For one thing, the dollar would have to collapse/default against one or more “entities”. The dollar is not like one of those highrises that collapse upon themselves. It will have to default or collapse against something(s) else. Since it is the world reserve currency, that means there would have to be a replacement reserve currency. Yes, that could also be for example gold or SDR’s, or even a basket of currencies, and something like that may happen eventually, but it doesn’t appear in the cards in the short run.

There are really only two candidates for the role, and neither looks at all fit to play it. The euro may have some ambitions in that direction, but it has far too many problems still. The yuan/renminbi certainly has such ambitions, but the Communist party refuses to let it get on stage to show what it’s got. As I recently wrote:

The main sticking point for Beijing is a conundrum it cannot solve. The CCP wants to have BOTH a global currency AND total control over that currency. It will have to choose between the two, and cannot make up its mind. So it pretends it doesn’t have to choose.

…click on the above link to read the rest of the article…

Italexit – New Party in Italy to Exit the EU

Italexit – New Party in Italy to Exit the EU

We are witnessing the rise of the new party in Italy headed by Gianluigi Paragone calling for the exit of there EU. New Italian party calls for the exit from EU bolding saying: “Germany takes everything and leaves the crumbs to the rest of the states.” As the economic hardship rises thanks to the virus scam, this risk our computer shows is not that they will win, but they are sowing the seeds of their own destruction. They will move to eliminate the physical currency and then they will advocate for perpetual bonds.  

Paragone began as a journalist. In 2018 he was elected Senator of the Five Star Movement. Then on January 1, 2020, he was officially excluded from the Five Star Movement but remained in the Senate as an independent. Then now in July 2020, Paragone has launched his own political movement, Italexit, with the aim of bringing Italy out of the European Union

The oppression of this virus agenda to force compliance with their Great Reset runs the risk of destroying the economies of Southern Europe which have a very high reliance upon tourism which has been brought to a halt in Europe.

The Forgotten Conflict That Is Threatening Energy Markets

The Forgotten Conflict That Is Threatening Energy Markets

One of the world’s forgotten conflicts is now making headlines again. In the last week, the military conflict between Azerbaijan and Armenia has reignited, with the two nations having already been engaged in a military confrontation for decades. Nagorno Karabach, an Armenian enclave inside of Azerbaijan, is one of the main underlying factors for the conflict, but the growing rivalry between Russia and Turkey is also playing a part. More than 16 soldiers have been killed in the most recent round of fighting. Both sides are accusing each other of aggression and military action. The use of full scale armed forces and drones have been involved, killing several soldiers on both sides and reportedly an Azerbaijani general. The current outbreak of fighting has been the deadliest since the “April War” of 2016. While most clashes normally occur in and around the Armenian controlled Nagorno-Karabakh region, the current clashes are on the international border between Armenia and Azerbaijan. The international community is urging both sides to end the clashes.  The United States, European Union, and the OSCE Minsk Group are trying to defuse the situation. While it remains unclear what reignited the conflict, it seems that Armenia played a large role in increasing tensions. Armenia recently constructed a new military outpost, which could have given Armenian armed forces a tactical advantage and tempted Azerbaijan to strike. At the same time, Azerbaijan is being buoyed by strong support from Ankara and may have wanted to test Russia’s support for Armenia. Remarkably, Armenia has called upon the Russia-led Collective Security Treaty Organization (CSTO), of which Armenia is a member, to intervene. The CSTO’s response, from Yerevan’s point of view, however, is lacking. As of July 14, the CSTO has only called for a normalization of the situation on the border, not implying that it would provide military support for Armenia.

…click on the above link to read the rest of the article…

Deep European Recession Forecast For 2020

Deep European Recession Forecast For 2020

In its Summer Forecast published today, the European Commission downgraded its own projection from earlier in the year, making for an even grimmer outlook for the EU economy in 2020. The -7.4 percent contraction originally expected has been reassessed to -8.3 percent.

Infographic: Deep European Recession Forecast for 2020 | Statista

You will find more infographics at Statista

In the EC press release, the following context was given:

“The EU economy will experience a deep recession this year due to the coronavirus pandemic, despite the swift and comprehensive policy response at both EU and national levels. Because the lifting of lockdown measures is proceeding at a more gradual pace than assumed in our Spring Forecast, the impact on economic activity in 2020 will be more significant than anticipated.”

And don’t expect the European banks to help, as Daniel Lacalle recently notesbanks may face a tsunami of problems as three factors collide: rise in non-performing loans, deflationary pressures from a prolonged crisis and central bank keeping negative rates that destroy banking profitability. We estimate a rise in net debt to EBITDA of the largest corporations of the Stoxx 600 soaring to 3x from the current 1.8x. This means that banks may face a wall of delinquencies and weakening solvency and liquidity in the vast majority of their assets (loans) just as deflationary pressures hit the economy, growth weakens and the central bank implements even more aggressive but futile liquidity measures and damaging rate cuts.

This combination of three problems at the same time may generate a risk of a financial crisis created by using the balance sheet of banks massively to address the bailout of every possible sector. It may undo the entire improvement in the balance sheet of the financial entities achieved slowly and painfully in the past decade and destroy it in a few months.

Weakening the balance sheet of banks and hiding larger risk at lower rates in their balance sheets may be an extremely dangerous policy in the long run. 

Europe must prepare for life after oil

Europe must prepare for life after oil

The COVID-19 pandemic is forcing us to leave the fossil fuel era behind. Europe needs to begin preparing for what comes next.

Oil prices have crashed. The most visible cause has been the measures taken to contain the COVID-19 pandemic, which have triggered record lows in global oil demand. 

Yet the crisis also exposes structural vulnerabilities in our fossil fuel-dependent economic system, which requires us to rapidly transition to an alternative energy system if we are to avert economic collapse.

The most important scientific concept to assess and understand these vulnerabilities is ‘Energy Return on Investment’ (EROI) – the foundation of the emerging discipline of biophysical economics. EROI is designed to measure how much energy is needed to extract energy from a particular resource. What’s left is known as surplus ‘net energy’, used to support goods and services in the economy outside the energy system. The higher the ratio, the more surplus energy is left for the economy. That surplus is running increasingly thin. 

In the early 20th century, the EROI of fossil fuels was sometimes as high as 100:1: a single unit of energy would be enough to extract a hundred times that amount. But since then, the EROI of fossil fuels has gone down dramatically[1], as we are extracting fossil fuels from places that are increasingly difficult to reach. Between 1960 and 1980, the world average value EROI for fossil fuels declined[2] by more than half, from about 35:1 to 15:1. It’s still declining[3]:  latest estimates put the value at between 6:1 and 3:1.

The decline of fossil fuels’ EROI has acted as a background ‘brake’ on the rate of economic growth for the world’s advanced industrial economies, which has been slowing down[4] since the 1970s.

…click on the above link to read the rest of the article…

EU Economy Traveling Along Same Worn Dead-end Road

EU Economy Traveling Along Same Worn Dead-end Road

With so many countries across the world facing difficulties, many people have yet to notice the Euro-Zone has become a place where hope goes to die. The last round of elections in the Euro-Zone should bring little comfort to those supporting a stronger Europe. Huge gains were made by forces seeking more power for the populist agenda. In short, it is a boost for the rights of individual nations to have more say in how they are governed.  Two of the most pressing issues are that insolvent Italy struggles with a stagnate economy and Spain is coming apart politically with Catalan separatists defying Spain’s Prime Minister. 

To avoid the union coming apart at the seams and a miserable future, the European Commission recently unveiled an unprecedented €750BN CoVid-19 recovery plan. It consists of €500 billion in grants to member states, and €250 billion would be available in loans. This means they are asking for the power to borrow. This is geared to tackle the worst recession in European history and shore up Italy. It would mean transforming the EU’s central finances to allow for it to raise unprecedented sums on the capital markets and hand out the bulk of the proceeds as grants to hard-pressed member states.

The Euro-Zone was already in deep trouble before CoVid-19 hit, the weakness that started in 2017 never ended. In the fourth quarter even Germany narrowly escaped recession. This could be blamed on the Brexit or Trade War but it goes beyond that, they abandoned all structural reforms in 2014 when the ECB started its quantitative easing program (QE) and expanded the balance sheet to record-levels. In 2019, almost 22% of the Euro Zone GDP gross added value came from Travel & Leisure, a sector that will unlikely come back anytime soon. Add this to weak exports and a banking sector that is totally decimated and everything points downward.

…click on the above link to read the rest of the article…

“A Legal Nightmare”: In Latest European “Freakshow”, EU Threatens To Sue Germany Over QE Ruling

“A Legal Nightmare”: In Latest European “Freakshow”, EU Threatens To Sue Germany Over QE Ruling

In the latest European farce, the European Commission threatened to sue Germany after the country’s top court questioned the legality of the ECB’s bond-buying program, Bloomberg reported over the weekend. In what Nordea’s Andrewas Steno Larsen dubbed the “ongoing freakshow in the Euroarea”, the EC president – a German no less – Ursula von der Leyen said that “The final word in EU law is always spoken in Luxembourg. Nowhere else.”

In other words, following last week’s shocking decision by Germany’s constitutional court which found that some aspects of the ECB’s QE are not constitutional and gave the ECB a 3 month ultimatum in which to demonstrate that QE was a proportional response, “we are gearing up for a remarkable legal stand-off between EU and Germany” writes Larsen, who adds that “the German head of the EU Commission, Ursula Von Der Leyen, is now openly battling her mother country’s constitution as she hinted that Brussels is considering taking legal steps that could result in Germany being sued in Europe’s highest court over the ruling from its constitutional court on ECB bond buying in a letter to the German Press Agency. Never underestimate the arrogance of EUR-crats!”

And here is the German European who is tasked with leading the onslaught on the German constitution.

German head of the EU Commission, Ursula Von Der Leyen.

And just to make sure the Germans are really pissed off, the ECB has tasked its staff to study if they should consider buying junk corporate bonds according to Reuters, “as if the ECB hasn’t manipulated credit prices enough already” as Nordea helpfully adds, noting that “ultimately, we think the EUR-ship will be glued together again – but markets are rightfully pricing in a risk of an ugly political showdown for the time being (wider spreads, relatively low EUR/USD etc).”

…click on the above link to read the rest of the article…

Olduvai IV: Courage
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Olduvai II: Exodus
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