The oil price used to spike upwards at the first sign of global fear. But times have changed. As a commodity, oil remains essential to modern life and economic welfare. However, its production is now more geographically dispersed than ever before. The US is a net exporter of oil. No longer is the middle east, and the Persian Gulf in particular, the most important part of a world that relies on oil for energy.
Events, dear boy, events!
Events are happening. It was the UK prime minister Harold McMillan who reportedly replied to the journalist’s question about what he feared for the times “Events, dear boy, events.” The modern day political leaders with a tendency to fear events have had plenty of material to work with in the last month. Let’s name a few, in no particular order or importance: the south-east Australian bushfires; the assassination of Iranian Republican Guard major-general Soleimani; Brexit; coronavirus; Tesla’s stock price. I will add one more: the impeachment of President DJ Trump, although this is less of an event and more of a political process.
The fires
Jann Gilbert, marine biologist, lost her home in the Mallacoota fires in eastern Victoria. In the Australian newspaper today, she was reported to have said: “The intensity of the fire was astounding. The ferocity of it has everything to do with climate change. I have lost everything. I just have the clothes on my back.”
Reports from Cobargo, southern New South Wales: “Residents have told of the devastation and terror they felt as fire roared through the village on the NSW south coast, claiming the lives of two people, destroying dozens of homes and leaving about 10 key businesses in ruins. Matthew Elmslie woke at 3.30am on Tuesday to see a 100m-wide fire charging towards his cattle farm in the historic town. By sunset, all he had left was the clothes on his back and a torch.”
The time and locations change, but the bushfire experience does not. 36 years ago, the Canberra Times was reporting details of the Ash Wednesday fires in February 1983: “Victoria was in chaos yesterday. Today, it will be in mourning. […] Emergency-service officials, when asked yesterday to assess the numbers of deaths and injuries and damage, said, “We can’t. It’s just chaotic.” That was the story everywhere as frantic relatives and friends tried to check on people living or on holiday in the worst-hit areas. At least 24 people died in the Cockatoo-Beaconsfield area in the Dandenongs. A young engaged couple died as they huddled together in a stormwater gutter. An elderly man died in his front yard trying to save his house from the flames. […] In the same area 12 volunteer firefighters died (and one is still missing) when two tankers were engulfed by the flames. Two more firemen died at Nar-Nar-Goon. On the coast west of Melbourne, almost the entire population of popular seaside town Lorne huddled on the pier as the fire swept through. At nearby Fairhaven, an elderly pensioner refused to leave his house and died. At Lorne, 50 houses were destroyed. At quiet Airey’s Inlet, 300 houses are gone. In rural Upper Beaconsfield, all that was left was a milk bar. One resident estimated the fire had come through at 120 km/h; another said, “This is the end of the world.” In Melbourne, it took several hours for the full horror to sink in as Wednesday ended with 40 degree-plus temperatures. […] Witnesses tell their stories to the media in a mixture of understatement and shocked awe. […] Survivors were stunned: “All I’ve got is what I’m wearing,” said one sobbing woman at Belgrave. “It was just so quick I couldn’t do a thing.” “I’ve never seen anything so frightening in all my life,” said another woman. “Really, you would have had just as much hope spitting on it, but you had to try anyway.” […] The confirmed death toll in the Victorian and South Australian bushfires stood at 69 last night. […] The South Australian toll stood at 26. […] The Prime Minister, Mr Fraser, visited fire-devastated areas yesterday. […]Yesterday, despite a hot beginning to the day, the maximum temperature was only 33 degrees. A cool change caused the temperature to drop after midday. Today would continue to be cooler, with a maximum temperature of 26. The weekend was expected to be fine and warm with a gradual increase in the maximum temperature. There was little prospect of rain.”
Worthy life; ripping yarn
For those looking for a tale of courage, endurance, suffering and resistance to tyranny: I encourage you to read about Jan Baalstrud.
It’s hard to argue with that
Climate change – down with this sort of thing. Hard hitting commentary on the streets from articulate youth.
credit: Phil Coomes/BBC
The great political realignment
Regardless of cause, it has arrived. The great political realignment is here. The left parties of Australia (Labor), UK (Labour), US (Democrats) and Canada (Liberals) no longer represent the people that they were originally formed to represent, that is, the wage earners. Instead, the wage earners now support the right of centre parties. There was a hint of this during the premiership of John Howard in Australia over a decade ago – Howard’s battlers were the trades workers in particular. This realignment has emerged in spectacular fashion with the election of Donald Trump, Scott Morrison, Boris Johnson and the recent chastisement of Justin Trudeau, all in the space of three short years. Add to that the allied cause of Brexit and it has been a magnificent three years. Jacinda Ardern in New Zealand should heed the warning signs, but I doubt that she will.
Continue readingNever ending impeachment
What just happened in Washington, DC? The Democrat controlled House of Representatives passed articles of impeachment against President Trump and then failed to deliver the articles to the Senate. Why not? The US constitution specifies the process to impeach a President. Up until last week, the Democrats were arguing that impeachment was an urgent necessity, the security of the country was as stake. Why the delay?
I can make no sense of this. The Democrats are now making themselves look silly. Now that the Congress is in recess over Christmas, some legal opinions say that the impeachment articles will lapse. Has the President been impeached or not?
The only possible reason that I can come up with for this delaying tactic is that the Democrats know the Senate would acquit the President and the impeachment process would go out through the same exit that the Russian Collusion and Mueller report went. If the impeachment articles are never delivered to the Senate, then the threat and distraction of impeachment remains and perhaps the public will become more supportive of the move. But in case, as it appears, that the bulk of the American public either do not care about the virtual impeachment, or in fact are more likely to support Trump as a result of this blatant partisan attempt to overturn the democratic process, an exit strategy is needed. That strategy is to make the case that the Senate obstructed the impeachment by not playing by the rules. Can anyone else explain this bizarre behaviour?
Climate Change – business must act
It seems that every Government regulator fears missing the bus. The bus with the giant mantra painted on the side that says ‘Business must address climate change!’ ASIC is the latest. It is reported in today’s press that ASIC will target companies that fail to disclose climate change risks to their shareholders.
I agree with ASIC’s conclusion: business should address climate change risks. Not because I believe that the earth is on a catastrophic path to being uninhabitable (it isn’t) but because of the policies and regulations that I fear weak-kneed right-of-centre governments will introduce. The difference between right-of-centre governments and those of the left is measured in time, not policy. The policies of the left are eventually implemented by the right.
Continue readingIn search of 5% pa
Are investment returns becoming more elusive? In nominal terms, yes. But in real terms, maybe not so much. Possibly the single largest consequence of the Australian grand social experiment that is compulsory superannuation is that nearly everyone now has to decide how to invest financial assets over a very long term. What was previously the domain of a few is now a national occupation. In the current investment environment, it is an occupation that has lost a lot of its charm.
Continue readingBanking governance; or maybe not
I’m an unhappy shareholder of Westpac. There will be a lot of shareholder wealth destroyed before this sorry tale is over.
By way of background, Westpac stands accused by the relevant regulator of failing in its obligations to identify and report suspicious transactions that could indicate money laundering or terrorism financing. In this case, it is alleged that millions of dollars and transactions have been made through the use of Westpac accounts and payments systems to launder money ultimately used to facilitate child exploitation. Further, it is alleged that Westpac has known of these transactions for several years and has not acted.
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