Water: the next battle ground

Clean water is the most valuable resource on earth, allowing for-profit-companies to take it for next to nothing must end. When the asset is properly valued, many of the current business uses will be uneconomical and cease, and that is necessary.  Individual communities must tune in to this issue.

A Michigan township has temporarily blocked Nestlé’s attempt to pump millions of litres of groundwater for bottled water — the latest in a trend of municipalities engaged in legal battles with the world’s largest food and beverage company.

Nestlé is seeking to build a pipeline booster pumping station near Evart, Mich., in an effort to supply more water to its plant in Standwood, more than 50 kilometres away.  Here is a direct video link.

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Eating ethical, healthy food

Individuals caring about the food we consume is the launching point for thoughtful habits.

Mark Bittman is the author of 20 acclaimed books, including the How to Cook Everything series, the award-winning Food Matters, and The New York Times number-one bestseller, VB6: Eat Vegan Before 6:00. For more than two decades his popular and compelling stories appeared in the Times, where he was ultimately the lead food writer for the Sunday Magazine and became the country’s first food-focused Op-Ed columnist for a major news publication. Bittman has starred in four television series, including Showtime’s Emmy-winning Years of Living Dangerously.  Throughout his career Bittman has strived for the same goal: to make food, in all its aspects, understandable.

Here is a direct audio link.

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Some food science fun for US Thanksgiving

Vegan bakers discovered chickpea juice acts like an egg white, putting meringues back on the menu.  Here is a direct video link.

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Bubbles, capital risk and the panic building

Many good points are made in this recent discussion with Fed up author Danielle Di Martino Booth (see two important caveats I would add below).

Bitcoin’s rapid rise in value is sending a warning signal, according to former Fed insider Danielle DiMartino Booth. She says, “To me, Bitcoin is a reflection of panic. It’s a reflection of people trying to get money into a safe place knowing the major governments of the developed world have got their printing presses running 24/7. It is a reflection of anxiety in fiat currencies and the fact it’s not practical to go back to a gold standard.  Here is a direct video link.

Two important caveats I would add.  First, not all bond risk is equal. DiMartino Booth is specifically talking about the risk to corporate bond holders who have overpaid for debt securities in a grab for cash flow. This lowered yields to the de minimus range. Meanwhile the market price of corporate bonds tends to move with the equity cycle. So as shown below since 2007, when downturns begin credit risk is realized and holders start liquidating corporate bonds and equities all at once. Many corporate bonds lost 30-50% of their market value in the 2008-09 downturn, others went to zero as their issuers went bankrupt. There is no safety and little diversity benefit in holding over-valued corporate debt.  Hence the timeless truth that reaching for yield is capital destructive.

This chart from my partner Cory Venable shows the relative price decline of investment grade corporate debt (grey), versus hi yield or junk bonds (in red) and 10 year government treasuries (in blue) during the 2008-09 bear market and the sharp but short sell-off in early 2016. In times of liquidity crunch and falling markets, capital typically flows out of risky assets and into government bonds, especially in North America.

Secondly, Di Martino Booth mentions gold and silver as assets people can buy as a safe place to store savings. As I have said many times, one can hold bullion in their home safe with a portion of their money if it makes them feel more diversified or if one thinks bartering with bullion will be a durable medium of exchange. However, holding the securities of gold and silver companies is not likely to add capital protection, they tend to plunge along with other risk assets in bear markets. Bullion too.

Keep in mind that gold lost 30% of its market value in 2008 and 44% between August 2011 and December 2015. Silver fared worse falling 72% into 2015. What safety of principle? You can read more thoughts about gold here in my 2011 article A word to the gold bugs.

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When vested powers control our access to information we all lose

The Federal Communications Commission, is preparing to undermine the founding principle that has defined a free and open internet since the foundation of the World Wide Web.

The Trump admin.’s FCC chair has drafted a plan to roll back Net Neutrality. @SRuhle explains how the decision could impact every internet user in the country. #VelshiRuhle pic.twitter.com/9wWoCJ3wZd

Also see FCC is revving up to destroy the internet as we know it:

This is not an enormous surprise. The principle of net neutrality—which ensures internet service providers (ISPs) cannot favor some data over other data—has been contested by large telecom providers and their pro-corporate political allies for years.

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Mayhem runs riot in a world jacked up on credit and ‘free’ money

Headlines offer a taste of the madness and mayhem dominating our global financial system.  While the new US tax plan promises to add over a trillion to the national debt and divert more cash flow from the real economy into already surreal financial speculation, consider:

Bitcoin soars past $8000

Today Bitcoin (not counting the 700+ other ‘crypto’ coins arriving daily out of thin air) has a notional market cap (# of virtual tokens outstanding x going exchange rate per US dollar) of over $133 billion–larger than many Fortune 500 companies who own land, equipment, systems, patents and collect billions in revenue.  Bitcoin is backed by nothing but faith it will go higher.  This has no rational connection to the future value or potential of blockchain.

Easy come, easy go, see:  $31 million theft of Bitcoin from ‘Tether’ virtual wallet renews concern about the security of digital coins.

Unlike when someone steals money from our bank account or credit card, there is no reimbursement or insurance to cover the physical loss of virtual currencies, never mind a sudden plunge in price or evaporation of buyers should one wish to move funds out of bitcoin and back to whatever currency our living expenses are actually paid in.

Not to worry:  High-speed traders in search of new markets jump into Bitcoin.

Having broken most of the other markets already, and with competition making it harder now to steal profits worth taking, high frequency traders (HFT) and hedge funds are raising funds and leverage to pile into virtual currencies.

And these stories barely scratch the surface of the marde passing as normal at the minute.  None of this can continue indefinitely or end without great pain.  Take extraordinary care.

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