Category Archive: World Economic Issues

News and analysis of world economic

Jan 12

Cigarette Makers Frustrated As Product Approvals Stall

A clerk prices cigarettes at Discount Smoke Shop in Ballwin, Mo. The Food and Drug Administration, which must approve all new tobacco products or any changes to existing brands, has not cleared any products since assuming that responsibility in 2009. It’s been only a few years since Congress granted the federal government the power to …

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Jan 12

10 Market Insights

1. The four trading fears 95% of the trading errors you are likely to make will stem from your attitudes about being wrong, losing money, missing out, and leaving money on the table – the four trading fears 2. The proverbial empathy gap You may already have some awareness of much of what you need …

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Jan 12

The Appeal of Master Limited Partnerships to Investors

The master limited partnership’s (MLP) lineage dates back to 1981, when exploration and production outfit Apache Corp (NYSE: APA) consolidated 33 of its oil and gas operations into this structure. In the mid-1980s, the universe of publicly traded partnerships differed dramatically from the options available to today’s investors. With no limitations on what assets and …

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Jan 12

US and Russian Geopolitical Battle will Decide Fate of Czech Nuclear Power Plant

The upgrade of Temelin, a nuclear power station, has become the backdrop of a power struggle between the Unites States and Russia. Worryingly, a discussion on Czech energy policy is being silenced by the competition of foreign strategic interests. As Germany and other European states turn away from nuclear power, the Czech Republic is looking …

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Jan 12

Oil Industry Cycles Offer Good Investment Opportunities

Investing for me is about identifying long-term trends, and then investing in companies whose business I understand, that will benefit from those trends. For more than a decade, my own investment strategy has focused on two major trends: (1) I believe that as the massive demographic of Baby Boomers moves into post-retirement, a tremendous amount …

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Jan 09

5 Biofuel Trends to Watch Out for in 2013

Despite a relatively down year with respect to investment and production capacity expansion, the biofuels industry grew modestly in 2012, continuing a shift from first generation facilities to next generation, advanced biorefineries. Although it was a year of challenges for corn starch ethanol production in particular, the industry proved its mettle against persistent drought across …

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Jan 09

Energy Stocks to Keep on your Watchlist During the Global Market Lull

In the midst of a global market lull, many companies are sitting on their hands, argues Mark Lackey of CHF Investor Relations. That’s why he’s scoping out smart management that’s keeping busy and making great progress—whether or not the markets are quick to notice. Learn who’s getting a running start in the uranium, oil and …

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Jan 09

Why 2013 Will End in a Severe Recession

We have been hearing a lot about escaping the fiscal cliff, but our problem isn’t solved. The fixes to date have been partial and temporary. There are many painful decisions ahead. Based on what I can see, the most likely outcome is that the US economy will enter a severe recession by the end of …

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Jan 09

The Transition Beyond Strategic Nuclear War

The world is now well advanced in transition to the age beyond strategic nuclear weapons. It may be, from the standpoint of military descriptors, a transition to the age of cyber weapons. Equally, it may be too early to say. But rarely in history are such great watersheds so visible, except in hindsight; watersheds which …

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Jan 09

What Stands in the Way of Natural Gas Replacing Gasoline in the US?

The natural gas revolution has brought big changes to the U.S. energy scene. Natural gas prices, which used to move closely together with oil prices, have plunged in the last five years, as the following chart shows. One result has been the rapid displacement of coal by natural gas in electric power generation. According to …

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Jan 06

Blackstone Lists Several Events that could Surprise the Markets in 2013

Byron Wien, Vice Chairman at Blackstone Advisory Partners, one of the world’s largest investment firms, has 10 predictions that may surprise markets in 2013. Wien defines a “surprise” as an event which the average investor would only assign a one out of three chance of taking place but which he believes is “probable”, having a …

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Jan 06

Germany’s Housing Market Is Hot. Is It Overheating?

Few Western countries are as conservative about home ownership as Germany, where less than half the country’s citizens own property. German banks have tough lending rules. Would-be buyers are usually asked to provide hefty down payments to secure mortgages, meaning few Germans even think about buying a home until they are settled and financially secure. …

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Jan 05

Diminishing Prospects For The Long-Term Unemployed

The latest figures show December was another month of steady, moderate job growth. But for many people still struggling with long-term unemployment, the situation hasn’t actually changed much at all. For Alecia Warthen, the last eight months have been painfully stagnant. She was the first person in her family to finish college, after growing up …

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Jan 04

Are Wind Subsidies the Best Use of Taxpayers Cash?

The U.S. taxpayers are in better than $16 billion dollars now and just got hooked for another $12.1 billion more.  That’s $161,333 per for 75,000 jobs.  Admittedly, compared to some government subsidy deals this looks cheap. (Roll Eyes) Subsidizing wind energy surely should be at the end of the subsidy era.   The era is 20 years old …

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Jan 04

Do EVs Make Good Cents or Sense?

David Herron of Torque News stated in his article “60 kWh Tesla Model S rated at 208 mile electric driving range by EPA:” “The 85 kilowatt-hour Model S, $77,400 for 265 miles range, or $292/mile of range. The 60 kilowatt-hour Model S, $67,400 for 208 miles range, is $324/mile of range. The other electric cars …

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Jan 04

Four investor predictions and a wild card for 2013

     It’s that time again when pundits and guru wannabes of all stripes say how they think 2013 will turn out for the economy and markets. Here are my four best predictions, along with one big wild card. 1. The U.S. economy will continue to grow, albeit slowly, in 2013. Now that we’ve avoided …

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Jan 03

Why the US Oil Market will go from Strength to Strength in 2013

In a continuation of our series on the state of the oil industry we look at some of the other ramifications of what we are labelling the Oil Renaissance in the US, and around the world for that matter.  This phrase was first proposed regarding the potential Nuclear turnaround here in the US, where companies …

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Jan 03

China in Africa: Partners in the Year of the Snake

African exports to China have increased six-fold since 2000 alone, the bulk of it in oil, and this year, China surpassed the US and Europe as Africa’s largest trading partner. Starting from $11 billion in bilateral trade in 2000, Beijing racked up $160 billion dollars in trade with Africa by 2011, and for 2012 Chinese …

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Jan 03

Five Unlikely Energy Surprises for 2013

Many people trot out their predictions for the coming year right about now. I’m generally allergic to predictions and think rather in terms of probabilities. Naturally, the world we live in is far too complicated to yield anything approaching certainty concerning such matters as the future price and supply of energy, future economic conditions, and …

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Jan 03

Why Riyadh Cares about the “Fiscal Cliff”

Oil revenue made up more than 90 percent of the total revenues for Saudi Arabia despite a steady decline in production. With a choppy 2012 drawing to a close, the Saudi finance minister said the kingdom had run a multibillion-dollar budget surplus. Despite a tense economic year, the ailing Saudi king, for his part, said …

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Jan 03

Syria’s Oil Now a Target of Civil War

It was only a matter of time before Syria’s oil industry, sagging as it may be, became a target in the country’s civil war, a conflict that is rapidly devastating Syria’s infrastructure and economy. The latest casualty is now Syria’s modest oil industry, already suffering from lack of modernization. In two separate incidents in the …

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Jan 03

What Investors Should be Looking out for in 2013

The lesson from 2012: We can ignore the Mayans, ZH and many other preachers of doom and gloom. Everything ends and the world will also end someday. We can’t get caught up in bear talk all the time and not live a normal life. This dysfunctional central bank liquidity fuelled market will again enter crisis …

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Jan 03

How Accurate are Long-Term Government Oil Forecasts, Can we Trust them?

[I]f you’re still operating under the assumption that the earth’s petroleum–or at least the cheap stuff–is about to run out, you’re not going to thrive in the new oil era. Technology is making it possible to find, produce, and refine oil so efficiently that its supply, at least for practical purposes, is basically unlimited. –Businessweek, …

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Jan 03

Will Washington Now Hold Shell’s “Feet to the Fire?”

Environmental advocacy groups expressing concern over frontier oil developments in the Alaskan arctic started the New Year on news that Shell’s (NYSE:RDS.A) problems in the region continue. This week’s grounding of the drill ship Kulluk was evidence that working in the harsh arctic environment was “a monumentally bad idea,” said Greenpeace. The U.S.-based supermajor last year secured …

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Jan 01

Cleaning House: Will Obama Go After the Big Boys?

The ban on BP (NYSE:BP) is only the tip of the iceberg. In the wake of oil spills, deaths, murky war contracts, sharing of government secrets and other lapses in ethics, Obama’s 2012 house-cleaning project will continue into the New Year. Cleaning up the messes of the past decade of contractual chaos in the US …

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Jan 01

Energy and Foreign Policy Predictions for 2013

The year 2012 helped bring answers to a few of the questions that loomed large for foreign observers when the year began. We now know who will lead the United States for the next four years. We have confirmation that the Muslim Brotherhood and its affiliated branches across the Arab Middle East remain the dominant, …

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Jan 01

Drinks, Diets And Meat: Hits Of 2012, Predictions For 2013

As the new year begins, we here at The Salt are looking back at the food topics that got you talking in 2012, and pondering which conversations will continue in 2013. (And, like many of you, we’re also firmly swearing off the holiday cookies.) So, instead, feast your eyes on this roundup of our top …

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Dec 30

Obama ‘Modestly Optimistic’ On Cliff Deal

President Obama went on the air to levy pressure on Congress Sunday as Senate leaders worked to negotiate a deal to avert the tax hikes and spending cuts known as the “fiscal cliff.” “I was modestly optimistic yesterday, but we don’t yet see an agreement,” Obama said in an interview with NBC’s Meet the Press taped on …

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Dec 29

In a World Full of Risk, Why Are Investors So Calm?

The economy and markets of 2012 sport nearly as many risk factors as a Cialis ad: Four years into full monetary tilt, does the Federal Reserve much know what it’s doing, and should we grow to expect QE6? Can a recessionary, politically scattershot Europe apply a cordon sanitairearound the still very real threat of contagion? What will arrest chronically …

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Dec 29

Interest Rates Near Zero Put Savers in a Bind

Paul Hernandez describes himself as “one of those people who believe in standing on your own two feet.” At age 48 he lost a job as a contract programmer for Princess Cruise Lines, and he hasn’t been employed since. For a long time that was fine. His wife was earning a good salary; they lived …

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Dec 28

How to Find Undervalued Energy Stocks

To find undervalued energy stocks that offer upside and stability, look for utilities with undervalued energy assets. That’s Ray Saleeby’s preferred method, and the experienced value investor has shared his top picks in this Energy Report interview, along with some research pointers. Read on to find spin-off pearls missed by overspecialized market analysts. The Energy …

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Dec 28

Energy Abundance vs Slow Growth Rates

It was the best of times; it was the worst of times for the American public over the past month, as it was treated to two high-profile, but deeply conflicting, economic forecasts. Despite declaring in 2008 that the age of cheap oil was over, the International Energy Agency (IEA) surprisingly announced last week that the …

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Dec 28

The Coming Oil War in Iraq

One year after U.S. forces left Iraq, oil production is such that the country is situated behind only Saudi Arabia among OPEC member states. New export infrastructure in the south of the country has in part led to a 400,000-barrel production increase since last year. Iraqi oil production, however, has declined since September because of …

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Dec 28

Energy Independence is Nothing but an Illusion in the Modern World

Anyone who tells you that energy independence can be achieved based on globally traded commodities such as oil, coal and natural gas is either trying to mislead you or doesn’t understand the structure of energy markets. As of 2011 fossil fuels produced 83 percent of the world’s energy according to the U.S. Energy Information Administration …

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Dec 28

Stocks fall under fiscal cliff pressure

U.S. stocks opened lower Friday, as lawmakers fumble to find a solution to the fast-approaching fiscal cliff. The S&P 500, the Dow, and the Nasdaq were down between 0.5% and 0.6%, as fears grow about the impact of no deal. The uncertainty has taken a toll on markets. Stocks have sold off for four straight sessions as hopes for …

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Dec 27

Australia’s economy Review

AUSTRALIA’S economy can boast more than two decades of uninterrupted annual growth, low inflation and low unemployment. This is largely thanks to structural reforms made in the early 1980s and strong demand from Asia, particularly China, for the country’s mineral and energy resources. The export-led mining boom has helped to strengthen the Australian dollar. So …

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Dec 27

Money-laundering settlements

BRITAIN’S biggest bank, HSBC, has settled a money-laundering probe by American authorities for $1.9 billion. The bank admitted that its money-laundering controls and compliance with sanction laws had been inadequate. The allegations had included links to drug cartels and terrorist financing. This record settlement with American authorities comes after another British bank, Standard Chartered, agreed …

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Dec 23

Why Investors Should Stay Clear of Renewables

People can “go green” all they want. After all, America is still the land of the free. But I just don’t recommend that investors do it. And that’s not because I’ve got something against the tree-hugger mentality. I actually consider people’s near-religious passion to improve energy efficiency – and be responsible stewards of our world’s …

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Dec 23

10 Interesting Economic Statistics from 2012

Here are 10 economic statistics from 2012 that capture some of the most noteworthy trends of the year, and that will shape the energy world in the years to come. Natural gas, one of the three key fossil fuels in our energy economy (along with coal and petroleum), continues to ascend as a major force. One prominent …

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Dec 22

Who Needs Gold?

Who the hell needs an umbrella in the middle of a draught? Snow boots in a roasting desert? A National Rifle Association bumper sticker at a UC Berkeley sit-in? For traders, the bigger question is why they should be long gold during one of the most aggressive “RISK ON” rallies in recent years, when asset …

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Dec 22

Is Now the Time to Invest in Gold?

It’s not been a good month for gold as the price has dipped from about $1,750 an ounce to under $1,670, two large sell-offs in recent weeks accounting for the bulk of that $80 decline and once again spurring talk of manipulation in the gold market. Who is responsible for these market-moving sell orders and …

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Dec 22

How Relevant is Syria’s Oil in the Conflict

Syria is among the countries in the Middle East which produces oil, though not nearly enough to be counted as one of the major producers, such as the giant Saudi Arabia or even tiny Qatar, the second smallest oil producing country. However, Syria’s output makes it the only substantial oil producer in the Eastern Mediterranean …

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Dec 22

Natural Gas, the Perfect Bridge to Renewable Energy – Part 2

… continued on from part 1. So what is natural gas? Natural gas is a mixture of hydrocarbons that varies across the board, depending on where it is found, but its chief component is “methane”, which usually makes up about 80-95 % of the gas. The rest of the gas consists of varying amounts of other …

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Dec 22

Financial Times Review 2012/12/22

2012 review: It could have been worse According to Mayan prediction, the world should have ended yesterday, so if you are reading this, things have turned out better than expected – and that’s largely the story of investment markets during 2012, too. The year began with three key risks: that the eurozone would be subject …

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Dec 20

Paul Krugman: China’s Economic Growth May Kill Us All

Paul Krugman, the Nobel Prize winning economist and New York Times columnist, believes that China is a great example of human success. The speed and power of its economic growth, and its contribution to the development of new technologies are shining examples of what humanity is capable of; however, at the same time, China’s success …

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Dec 20

Replacing Fossil Fuels with Renewables – Part 1

Economic Growth! Energy independence! Climate Change! There are countless arguments for moving beyond fossil fuels, for world energy needs. Unfortunately, many hurdles must be overcome before we can feasibly count on other sources of energy to replace coal, oil and possibly natural gas, which all together provide the lion’s share of the world’s electricity generation …

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Dec 20

Why Energy Prices may Drop in the Future

The long-term evolution of energy prices affects the fundamental environment for stock prices. When consumer prices for various goods and services have different but sustainable trends relative to energy prices an opportunity arises for sound investments. Our observations show that some of these sustainable trends have clear turning points which provide investors with invaluable information …

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Dec 20

Ukraine and Russia Gamble over Europe’s Gas Supply

It’s been a rough year for Ukraine: The country is caught in the vortex of a European-Russian gas war, paying prohibitively high gas prices to Russia and reeling from a humiliating billion-dollar fake gas deal with Spain. Still, Ukraine plods along in this war, but Russia holds the cards. Ukraine is paying about $430 per …

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Dec 20

Daily Commodity Update – 18.12.12

Energy: Crude oil will finish up 1% on the day closing at its 50 day MA. Prices are up almost $3/barrel in the last week and could continue to grind higher. As long as the 20 day MA holds I am bearish. That being said I would not rule out a correction and today I advised …

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Dec 20

Stocks: Investors hold onto fiscal cliff hopes

U.S. stocks were flat Wednesday as investors clung to the belief that politicians in Washington can resolve the fiscal cliff stand-off after weeks of gridlock. As investors wait to see if a deal is taking shape, the Dow Jones Industrial Average rose 0.3%, while the S&P 500 and the Nasdaq were little changed. Investors apparently were willing to dismiss the latest …

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