The World According to Tempus

Iraq War Costs

I'm a bit behind in my reading of The Economist, once again, but I was just reading this article:

http://www.economist.com/displaystory.cfm?story_id=6787433

I was concerned by this comment in particular:

Why is the Bilmes/Stiglitz estimate so high? Partly because they attribute a number of economic ills—oil prices, interest costs and foregone government projects—to the war in Iraq. These seem questionable claims. Oil prices are indeed much higher now than in early 2003, but the war's impact on global oil supplies has been relatively small; a surging world economy has driven up demand. Including the interest payments on America's Iraq spending is also strange. Alan Krueger, a Princeton University economist writing in the New York Times, has likened this to counting interest payments on a home mortgage as part of the purchase price. As for government projects, that estimate hinges largely on the perennial debate over whether more public investment would yield net benefits for the economy.

Silver Update

It seems my post of March 29th was somewhat timely, if I might say so.

In the last three weeks, the price of a boring commodity has climbed from 10.90$ an ounce to a high today of 14.50$. Is it sustainable at this rate? Probably not. That's 33% in three weeks.

Will it go higher? Most likely!

Looking Back

Hi everyone! It looks like I haven't posted in two weeks. I was on vacation, and believe it or not, it is far easier to find 15, 20 minutes when you are in work mode to make a post then when you are spending your day babysitting!

Now, I should be back to posting some good stuff. In this mini-post I want to look back at a prediction I made almost seven years ago...

The Attack on the U.S. Dollar and Energy Needs

Another interesting article, a bit more recen't, than yesterday's from Alan Caruba, Canadian Free Press.

http://www.canadafreepress.com/2006/caruba032006.htm

This article attempts to point the viewer at some of the challenges of the western democracies (especially the US) regarding the increasing need of importing their energy from non-democratic sources. This is not a problem we are facing in Canada, as we are now a major oil exporter (and might very well be positioned as such for a long time as the tar sands in Alberta continue to develop).

As much as the energy industry is helping Canada's economy to grow nicely, have a nice fat trade surplus and balance its government books, the effects are even more dramatic, and have far-reaching consequences when these money flows are applied to some countries which are not friends of the US.

Will we see with energy the same kind of war that we see with drugs? Tons of money go to drug lords all over the world, financing crime and personal armies. Same as with cocaine and all, the US consumer is driving the prices higher and higher, giving those who control the resources more money to secure their position.

March 20 to 26, 2006: Iran-USA, beginning of a major world crisis

This is an article, posted by LEAP/E2020, a European think-tank. It is a very interesting, if scary article. I had shared this article with some friends last month, and now we are past that week. By now, the two items that they claim will change our economic world have happened. I will surely discuss both in future postings. The two items are the opening of the Iranian oil bourse last week, as well as the Federal Reserve Bank's decision to stop publising M3 figures, which is the wide money supply numbers (the amount of US dollars in circulation).

http://newropeans-magazine.org/index.php?option=com_content&task=view&id=3463&Itemid=85

Here is the article's intro:

Or « The End of the Western World we have known since 1945 »

The Laboratoire européen d’Anticipation Politique Europe 2020 (LEAP/E2020) now estimates to over 80% the probability that the week of March 20-26, 2006 will be the beginning of the most significant political crisis the world has known since the Fall of the Iron Curtain in 1989, together with an economic and financial crisis of a scope comparable with that of 1929. This last week of March 2006 will be the turning-point of a number of critical developments, resulting in an acceleration of all the factors leading to a major crisis, disregard any American or Israeli military intervention against Iran. In case such an intervention is conducted, the probability of a major crisis to start rises up to 100%, according to LEAP/E2020.