Japanese food radiation warnings, US households deleveraging, misguided central banks, shrinking populations in high income countries, investors required to be scientists, Europe’s unresolved fiscal mess, disruptive technologies, global police action in Libya, and Vancouver Island’s risky geography add up to much to think about for anyone betting on futures that are reasonably excellent.

Gwynne Dyer asks the obvious question about nuclear power. The comments are instructive about the level of sophistication around the debate. Thanks to David of London for sending this in.

Toronto Star – Nuclear Power: Why the Panic?
Suppose that a giant hydro dam had crumbled under the impact of the biggest earthquake in a century and sent a wave of water racing down some valley in northern Japan. Imagine that whole villages and towns had been swept away, and that ten thousand people were killed — an even worse death toll than that caused by the tsunami that hit the coastal towns.

How much radiation do you pick up sleeping next to someone and how much will kill you? These two links provide excellent graphic answers to those questions. (hat tip – Big Picture)

people.need.edu – A Layman’s Introduction to Radiation
I've made this page in an attempt to explain some concepts in radiation to a general audience.

 

xkcd – Radiation Chart
There’s a lot of discussion of radiation from the Fukushima plants, along with comparisons to Three Mile Island and Chernobyl.

PBS spreads nuclear nonsense. (ed’s note – the time would have been better spent focusing on how to manage spent fuel rods)

PBS – A Self Inflicted ‘Third Nuclear Bomb’
At the time of Japan’s devastating 8.9-magnitude earthquake last week, Japan had 54 nuclear reactors, producing roughly 30 percent of its electricity. In the disaster’s aftermath, Prime Minister Naoto Kan said Japan was experiencing its most difficult crisis since the end of World War II.

Mummy how come the economy is having trouble growing? Households are deleveraging and governments are borrowing.

NYT – A Shift in the Balance of Debt Obligations
FOR years, the American financial sector borrowed and borrowed.

 

James Grant whose investment advice always turns out to be right provided you can bear the pain of everyone betting the other way reminds us that modern central banking treats interest rates like a drug.  (ed’s note – the problem with linking your currency to a base metal when everyone else prints money at will is that the day of reckoning for the latter comes after your manufacturing base has disappeared and disgruntled voters have thrown you out of office).

Grant’s Interest Rate Observer – Over to You, H. Parker Willis
"What Should the Federal Reserve Do Next?" was the headline over the roundup of expert monetary opinion on the op-ed page of the Sept. 9 Wall Street Journal.

Quote worth quoting.

“What Should the Federal Reserve Do Next?" Less, we say. Withdraw from the business of macroeconomic management. Acknowledge the essential error of the doctrine of interest-rate manipulation. Confess to the obvious flaws in the paper-currency system. Renounce debasement under the pseudo-scientific name of "quantitative easing."

Related.

Fractional Reserve Banking
Fractional-reserve banking is the banking practice in which only a fraction of a bank’s deposits are kept as reserves (cash and other highly liquid assets) available for withdrawal. The bank lends out some or most of the deposited funds, while still allowing all deposits to be withdrawn upon demand. Fractional reserve banking is practiced by all modern commercial banks.

About a week ago when that first plume of radioactive stream blasted its way out of the Fukushima nuclear plant and the markets threatened a mini meltdown, I got a call from a dear friend who manages a billion dollar plus fund.

What did I think about the risks from this latest tragedy coming from Japan?

My advice was that since there were a range of probabilities around this nuclear event that ranged from one to ten, one being Ten Mile Island where no one died and ten being Chernobyl where the number of dead is still unknown because the cancers are still manifesting themselves but altogether probably about a month's worth of traffic fatalities in the United States (3.000) that he ought to be speaking to a scientist not a sometime economist. (ed’s note – Tony Fell would have expected the economist to have already spoken to three scientists and have the answer ready for the 7.15 director’s meeting).

How the markets try to wrap their arms around risk.

NYT – A Crisis That Markets Can’t Grasp
THE risks are clear enough in hindsight.

 

Oh, and what’s a bigger menace for the global economy than Japan’s travails?

Europe’s debt crisis. Robert Samuelson explains.

Real Clear Markets – Europe’s Debt Crisis Trumps Japan
While the world has been transfixed with Japan, Europe has been struggling to avoid another financial crisis.

Our little video rental store in Cadboro Bay closed down because it could not compete against new DVD releases being available on cable, the arrival of Netflix in Canada, and the Blockbuster video store 5 minutes up the road. So what is in store for the movie delivery business now?

Looks like Netflix is about the change the game again.

techcrunch.com -- Netflix Original Content Is Much More Than A Strategy Shift
Three years ago, if you had asked people to choose between cable television and Netflix, the vast majority would have laughed at you. A DVD-by-mail service versus thousands of pieces of content always at your fingertips? No one is laughing anymore.

And speaking about not laughing: thoughts about the post modern world, starting with Japan.

fistfulofdollars.com – Surely There is Nothing Funny About What is Going on in Japan?
As Japanese officials continue to toil away in what we all hope will be a successful bid to avert a worst case scenario nuclear meltdown even while thousands of Japanese still remain missing and unaccounted for, financial market participants across the globe have been struggling with themselves to answer one and the same question: just how serious are the economic consequences of all this devastation likely to be?

In the end the United Nations agreed, the Arab League supported, and key European nations contributed military assets to the attack on Libya. What an achievement. Unless you believe the following argument.

FT – Europe, Learn to Live with Dithering
President Barack Obama was not in Washington when the first missiles struck targets in Libya. As the US went to war at the weekend – the third on his watch – he left for Brazil to discuss trade.

 

Related.

Independent – The Hypocrisy Behind this Intervention
On Saturday night at the BBC, I bumped into Tony Benn, looking more tired but still with that flame of righteous veracity in his eyes, which never quivers or wavers, a beacon for so many flapping around in this uncertain world.

 

Arab friends of liberty Qatar and United Arab Emirates total combined population, 5,996,680.

Diplomat – Arab Forces Stepping Up
The international force that has been assembled for Libya’s no-fly zone has some surprising contributors -- Qatar and the United Arab Emirates are both sending forces to operate alongside British, French and US planes.

Just kill the bastard?

Telegraph -- Libya: William Hague hints strikes could target Gaddafi
The Foreign Secretary said that the UN resolution authorising missile strikes at Libyan military assets could allow attacks aimed at the dictator.

 

The Vancouver Island earthquake and tsunami primer.

Time Colonist – The Quake Zone
Look no further than Japan to see the earthquake that will - not might - hit Vancouver Island, local earthquake experts say.