Oil speculations

Paul Krugman's economics editorials are usually good and his latest on the cause of high oil prices sounds good to me. He argues that speculation is a form of wagering that has limited impact on prices and that global demand is rising, etc.

"Why are politicians so eager to pin the blame for oil prices on speculators? Because it lets them believe that we don’t have to adapt to a world of expensive gas."

In addition to the global demand explanation, it could be as simple as this: imagine Firm A relies on a product from Firm B, but lacks real capital for payment and instead pays Firm B with stock in Firm A. The value of that stock declines and naturally Firm B wants more flesh, not just to keep up with current losses, but to compensate for declining holdings too. The US dollar is weak, US business is weak--what's a poor Saudi King to do?

It's possible in the short term that the issue of whether or not supplies are decreasing relative to demand is irrelevant as long as people think that's the case. Perhaps that explains the Saudi's thinking when they recently increased oil production? Their gamble seems to have paid off--they increased production and oil prices rose. It's certainly ironic to see peak oil proponents deride oil companies when the peak oil argument benefits oil producers so much.

The only thing I disagree with in the Krugman article is that "Regulating futures markets more tightly isn’t a bad idea..." It wouldn't matter. There could be no effort to regulate futures markets worldwide and increasing regulation in some markets would just shift trading to unregulated ones. How would the US dollar do in oil trading in regulated US/UK markets versus a less regulated one in Dubai? Do ya reckon the Chinese are wringing their hands over oil speculators? Just the opposite: the Hong Kong Mercantile Exchange will start selling oil futures next year.

I imagine oil bargaining between the US and OPEC is a lot friendlier than what is starting to heat up between Russia and the rest of Europe. It just occurred to me that I should have included something about Putin's strategic plans for Russia's fossil fuel wealth and Europe in the post about Russian oil. From Scott Horton, Harpers.org:

"Putin has an impressive, personal mastery of energy policy. Indeed, this has been a subject that has long captivated him. In St Petersburg, Putin did his kandidat nauk with his dissertation topic on the creation of a foreign policy for Russia which derived maximum benefit from Russia’s enormous oil and gas reserves, with a focus on the gas aspect. The dissertation argues that Russia’s gas resources and Middle Europe’s dramatic gas needs provide Russia with far more effective leverage with the Europeans than the military calculus of the late Soviet period."

What will Russia do when the Euro inevitably starts to slip?

China earthquake wedding photos

Amazing photos taken during an earthquake and wedding in China. I thought twice about posting the link because it seemed out of date at first. But, c'mon, it happened only a few weeks ago.

Russian military and oil

This month's National Geographic has a good article on oil production in Russia. It's the world's largest oil producer. The print version of the article has a striking map of how much Russian oil and natural gas is exported to Europe.

"Why is Moscow risking a new cold war?" at Spiegel.com describes what Russia's military is up to these days:

"A hint of the Cold War has been revived between the East and West, since Russia began sending out its pilots on missions once again, since its aircraft, in a throwback to Soviet days, have reappeared on radar screens in the Western hemisphere, and since they have, on occasion, come within touching distance of the British border and flown over the American aircraft carrier 'Nimitz' and a Japanese island (albeit unpopulated), to which Tokyo responded by dispatching two dozen fighter jets to drive out the intruders. 'Our job is to show that since we are capable of flying this far, we are also capable of carrying weapons to our destination,' says Major General Pavel Androssov, the commander of all strategic aircraft."

Western media soft on Fundy Islam

Bruce Bawer argues that Western news media and cultural outlets detrimentally self-censor criticisms of fundamentalist Islam.

"Motivated variously, and doubtless sometimes simultaneously, by fear, misguided sympathy, and multicultural ideology—which teaches us to belittle our freedoms and to genuflect to non-Western cultures, however repressive—people at every level of Western society, but especially elites, have allowed concerns about what fundamentalist Muslims will feel, think, or do to influence their actions and expressions. These Westerners have begun, in other words, to internalize the strictures of sharia, and thus implicitly to accept the deferential status of dhimmis—infidels living in Muslim societies."

He's the author of While Europe Slept: How Radical Islam is Destroying the West from Within and Stealing Jesus: How Fundamentalism Betrays Christianity.

Who's running the show

The Nation reports that the average income for the top 5 hedge fund managers in 2005 was $12.6 billion. Assuming that's the mean, the combined annual income of those five individuals exceeds the GDPs of most of the countries on Earth.

Places Yanks can't visit--part II

This blog might be turning into a Scott Horton fan site, but he's written a very satisfying article in the New Republic on the possibility (near inevitability) of Bush administration officials being charged in countries other than the US with war crimes, particularly crimes involving torture.

Horton writes, "...I have spoken with two investigating magistrates in two different European nations, both pro-Iraq war NATO allies. Both were assembling war crimes charges against a small group of Bush administration officials."

"...Colin Powell's chief of staff, Colonel Larry Wilkerson, nails it: 'Haynes, Feith, Yoo, Bybee, Gonzales and--at the apex--Addington, should never travel outside the U.S., except perhaps to Saudi Arabia and Israel [yay!]. They broke the law; they violated their professional ethical code. In the future, some government may build the case necessary to prosecute them in a foreign court, or in an international court.'"

12th Annual Okie Gun Cling

Only two more days until the Oklahoma Full Auto Shoot and Trade Show [video]. That would be one hell of a campaign stop for Obama.

Wine carbon footprints

According to Tyler Coleman (Dr. Vino), wine consumers may reduce their carbon footprints by drinking California wines if they're to the left of the line on the map, or drinking European wines if to the right of the line. No mention of other continents, but I'm guessing Aussie wines in the US are more Hummer than hybrid.

Swiss plant dignity and the end of time

According to Nature and others, Swiss law requires plant researchers to describe in grant applications how they will respect plant dignity in their experiments. It's tough to tell if the requirement is the unintended result of vaguely worded legislation or if it's intentionally anti-GMO. In any case, the Swiss plant dignity law is certainly ironic in the context of the Large Hadron Collider lawsuit. The LHC, on the border of France and Switzerland, will be the world's most powerful particle collider when it is completed in a few weeks. Some physicists fear it might destroy the universe. Amazingly, the operators of the LHC admit that it could create persistent black holes--no worries.

Michael Sheehan: how to deal with terrorism

From Harpers.org, a Scott Horton interview with Michael Sheehan on how societies should respond to the threat of terrorism and terrorist attacks.

TSA: no ID, no problem*

The TSA policy on air passengers without ID is to allow them on the flight after a thorough search as long as the passenger truly doesn't have ID and isn't just refusing to show it. That makes domestic no-fly lists absolutely pointless. The upside is that, in a jam, ditching your ID could be a good way to skip to the front of long security screening lines.

RFK's last train ride

NYT has a powerful slide show of photographs taken from the train that carried Bobby Kennedy's body from NYC to DC. Narrated by the photographer, Paul Fusco. "...and they saw hope pass by, in a train." Another reminder that the US needs to move on from the last 60 years.

(Hey Hillary, what month was that again?)

Latest Cheney Tape May Contain Evidence Of His Whereabouts

From The Onion

Censorship by Uhu

In China thousands of copies of the recent National Geographic Magazine featuring China have had pages glued together. Leslie and I have the issue (unglued)--she's looking forward to guessing what pages were censored.

$1m Warren Buffett bet

Warren Buffett bet managers of a hedge fund that a simple S&P 500 index fund outperforms their fund (accounting for fees) over the next 10 years. Buffett gives himself a 60% chance of winning and the hedge fund managers are glad they just have to outperform the S&P 500 and not Buffett. The picture of the fund managers is creepy--like a scene out of Vanilla Sky--probably not an accident.

Five places Yanks can't visit (Rebels too)

http://www.foreignpolicy.com/story/cms.php?story_id=4328

Jim Webb coverage increasing

Looks like the news media are going to hype Jim Webb as Obama's VP for the next week or two. Here and here are articles. He's the current leader on Intrade by 5 points over Clinton, whatever that means. Of the candidate names thrown around so far I'd say he and Biden are the best bets. At the same time, Webb was a Republican not too long ago and who knows who Obama's real allies are? Also, Biden will be in his 70s by 2016--tough for his own pres campaign.

Scott Horton and Max Weber on good politicians (?)

Scott Horton's blog on Harpers.org is consistently excellent. Here's an entry on a 1919 speech German sociologist Max Weber gave on what makes good politicians and how public apathy ruins countries. Surprisingly, after outlining a nearly Platonic ideal of politicians, Horton concludes that Obama and McCain really aren't so bad.

[Video] Maybe the English aren't so smart

Guy kicks a fence, fence guillotines guy's leg. Really, it's worth a watch.

British bubbly

This is the first post of this blog and I'm kicking it off with Champagne. Check out the entry on this Royal Society timeline for 1662. Turns out sparkling wine was invented by a Pom. I had no idea, but I'm glad it wasn't patented.

The word on the street is that big Champagne producers are buying land near Dover, UK in anticipation of global warming decreasing grape quality in Champagne vineyards. Dover and Champagne are part of the same geological feature that provides chalky soil in both places--good for bubbly.

On the same subject, researchers derived temperatures from Pinot Noir harvest dates in Burgundy from 1370 to 2003 and found that temperatures were pretty high in the Middle Ages, but 2003 was très hot.

No more outdated wine articles for a while hopefully.