At the End of a Long Continum of Progress

GEOLOGISTS tend to treat mankind as a temporary phenomenon of no great significance for the underlying structure of the earth. This, argue some, is a mistake. 

Our various interventions in the surface of the earth should really be considered as the dawn of a new, man-centred geological age: the Anthropocene. 

Here is an updated timeline for the earth, courtesy of The Economist, taking industrial man into account. (click to enlarge)

See the longer Economist article here...

Rare Earths - The Secret Ingredients of Everything

I became interested in the rare earths about 2 years ago from an investment point of view.  From smart phones to hybrid vehicles to cordless power drills, devices we all desire are made with a pinch of rare earths—exotic elements that right now come mostly from China.

National Geographic just ran a short spread on the minerals by Tim Folger in the June issue linked here.

An extract of the intro is below...

Most of us would be hard-pressed to locate Inner Mongolia, Jiangxi, or Guangdong on a map. Yet many of the high-tech devices we depend on—cell phones, laptops, and hundreds of others—would not exist without an obscure group of elements mined, sometimes illegally, in those three and other regions of China.

China Now Has A Monopoly Producing 97% of All Rare Earths

Rare earths, as the elements are called, were discovered beginning in the late 18th century as oxidized minerals—hence "earths." They're actually metals, and they aren't really rare; they're just scattered. A handful of dirt from your backyard would probably contain a smidgen, maybe a few parts per million. The rarest rare earth is nearly 200 times more abundant than gold. But deposits large and concentrated enough to be worth mining are indeed rare.

The list of things that contain rare earths is almost endless. Magnets made with them are much more powerful than conventional magnets and weigh less; that's one reason so many electronic devices have gotten so small. Rare earths are also essential to a host of green machines, including hybrid cars and wind turbines. The battery in a single Toyota Prius contains more than 20 pounds of the rare earth element lanthanum; the magnet in a large wind turbine may contain 500 pounds or more of neodymium. The U.S. military needs rare earths for night-vision goggles, cruise missiles, and other weapons.

"They're all around you," says Karl Gschneidner, a senior metallurgist with the Department of Energy's Ames Laboratory in Ames, Iowa, who has studied rare earth elements for more than 50 years. "The phosphors in your TV—the red color comes from an element called europium. The catalytic converter on your exhaust system contains cerium and lanthanum. They're hidden unless you know about them, so most people never worried about them as long as they could keep buying them."

Now a lot of people are worried. Read full story here.  An earlier article from 2010 is linked here.

For those interested in Rare Earth as an investment opportunity, listen to this James Dines interview at Financial Sense linked here.

America's Moment of Truth

Below is an excerpt from the preamble. The 60 page report is here ....  Why is this being ignored?

Listen to an persuading interview with former Senator Alan Simpson, report lead author at this link.

Throughout our nation’s history, Americans have found the courage to do right by our children’s future. Deep down, every American knows we face a moment of truth once again. We cannot play games or put off hard choices any longer. Without regard to party, we have a patriotic duty to keep the promise of America to give our children and grandchildren a better life.

Our challenge is clear and inescapable: America cannot be great if we go broke. Our businesses will not be able to grow and create jobs, and our workers will not be able to compete successfully for the jobs of the future without a plan to get this crushing debt burden off our backs.

Ever since the economic downturn, families across the country have huddled around kitchen tables, making tough choices about what they hold most dear and what they can learn to live without. They expect and deserve their leaders to do the same. The American people are counting on us to put politics aside, pull together not pull apart, and agree on a plan to live within our means and make America strong for the long haul.

As members of the National Commission on Fiscal Responsibility and Reform, we spent the past eight months studying the same cold, hard facts. Together, we have reached these unavoidable conclusions: The problem is real. The solution will be painful. There is no easy way out. Everything must be on the table. And Washington must lead.

We come from different backgrounds, represent different regions, and belong to different parties, but we share a common belief that America’s long-term fiscal gap is unsustainable and, if left unchecked, will see our children and grandchildren living in a poorer, weaker nation.

Over the course of our deliberations, the urgency of our mission has become all the more apparent. The contagion of debt that began in Greece and continues to sweep through Europe shows us clearly that no economy will be immune. If the U.S. does not put its house in order, the reckoning will be sure and the devastation severe.

We have worked to offer an aggressive, fair, balanced, and bipartisan proposal – a proposal as serious as the problems we face. None of us likes every element of our plan, and each of us had to tolerate provisions we previously or presently oppose in order to reach a principled compromise. We were willing to put our differences aside to forge a plan because our nation will certainly be lost without one.

We do not pretend to have all the answers. 

We offer our plan as the starting point for a serious national conversation in which every citizen has an interest and all should have a say. Our leaders have a responsibility to level with Americans about the choices we face, and to enlist the ingenuity and determination of the American people in rising to the challenge.

We believe neither party can fix this problem on its own, and both parties have a responsibility to do their part. The American people are a long way ahead of the political system in recognizing that now is the time to act. We believe that far from penalizing their leaders for making the tough choices, Americans will punish politicians for backing down – and well they should.

In the weeks and months to come, countless advocacy groups and special interests will try mightily through expensive, dramatic, and heart-wrenching media assaults to exempt themselves from shared sacrifice and common purpose. The national interest, not special interests, must prevail. We urge leaders and citizens with principled concerns about any of our recommendations to follow what we call the Becerra Rule: Don’t shoot down an idea without offering a better idea in its place.

After all the talk about debt and deficits, it is long past time for America’s leaders to put up or shut up. The era of debt denial is over, and there can be no turning back. We sign our names to this plan because we love our children, our grandchildren, and our country too much not to act while we still have the chance to secure a better future for all our fellow citizens.

Doing It Wrong All These Years

A wonderful 6 minute TED presentation that shows that assumptions and techniques we take on from childhood, even when wrong, stay with us for decades... how do you tie your shoes?

Jobs and Student Debt

As depicted below going back to 1948, typically job loss in the USA was a fairly deep trough with recovery coming relatively quickly.  Not so, this time...

Meanwhile, while out of work, many people have returned to school.  Lacking available funds to pay out-of-pocket, the use of student loans is expanding quickly.  There have been some reports that the total of student loan debt has now surpassed normal credit cards.  Of course, these are averages.  Many students have little or no debt, while others are well over $100,000 after graduation.

Making Money on a Savings Account

Are you tired of close to zero percent interest in your US dollar savings account? Perhaps it is time to move some of those dollars into other currencies. As the chart below details, in a one year period from last June, if you had transferred some of the dollars into Swiss Francs you would be up about 20% already. 

Even the Euro has been up almost 15% in that period. Although not shown, the Canadian and Australian currencies have also had strong runs.  What this means... if you changed $10,000 into Francs last June, you would currently have the equivalent of $12,000 with the 20% gain.  

And now, you do not even have to leave the country to set up an account. There are now Exchange Traded Funds (ETFs) you can buy through your broker just like a stock that mirror these currencies.  Of course, when the dollar strengthens these currencies lose value.  However, as noted here, the US dollar has been in a fairly strong down-trend since1933.

Tax and Spend Comparison over 50 years

Not much to say here.. the chart says it all. And what makes it more interesting is that 51% of American's currently do not pay any tax. And close to 40% are receiving some sort of tax credit reimbursement. Listen to audio link here.

The Hidden Power of Smiling

Ron Gutman reviews a series of studies about smiling, and reveals some surprising results. Did you know your smile can be a predictor of how long you'll live -- and that a simple smile has a measurable effect on your overall well-being? Prepare to flex a few facial muscles as you learn more about this evolutionarily contagious behavior.

Another great TED presentation!

Pension Comparisons

It is revealing to compare retirement ages and pension contribution participation rates among various countries.  Interestingly, Mexico is officially the oldest in actual numbers (72.2) and France the youngest (59.1).   

When we look at participation rates, Turkey has decreased significantly in the past 25 years, while New Zealand tops both Japan and the USA.

Moving on to looking at how many people are working to support 1 retiree, this has shrunk greatly since 1970 (lightest large blue) and will barely be tenable as projected into 2050 (small dark blue). Most of Europe is very low and Japan will require 1.2 people to support 1 retiree!

Complete narrative at The Economist article linked here

How much is a trillion dollars anyway?

A $100 bill

$10,000

$1 Million (100 packs of #10,000)

$100 Million

$1 Billion

$1 Trillion

Thanks to Pagetutor.com

A virtual choir 2,000 voices strong

An absolutely stunning melded choir composition by composer and conductor Eric Whitacre...

As one choir member commented:

"To all the people who had positive comments, thanks, we in the choir take a lot of pride in what we accomplished, what started as a song to sing has become (expectantly) a quest to enlighten humanity, and show the world that we can work together, for beauty, art and good."