8 thoughts on “Monday Message Board”

  1. Australia’s phantom recession is seeing parts of the country suffering from severe economic hardship, while some other parts are sailing along thanks to significant opportunities. The statistical evidence would suggest that there is no recession in Australia. Now technically that seems correct. To have a technical recession there must be two quarters in a row of negative growth. This has not happened in Australia since the end of the pandemic shutdowns. Growth did rebound well straight after the opening up of Australia’s trade channels. This benefitted some parts of Australia more than others. Western Australia certainly benefitted from a boom in minerals exports. The same was true for Queensland. But some other states did not fare that well. South Australia still lags behind other states in post pandemic economic recovery.

    But even within states there are significant difference in regional growth. Old technology regions are missing out on renewable energy infrastructure spending. The massive infrastructure spending from May 2023 to May 2024 did not benefit all regions. Then again the regions of Australia most dependent on tourism are still not booming. Not all the foreign tourists have returned in the same numbers as before 2020. And the tightening of belts by Australians under mortgage stress has reduced internal tourism numbers in certain regions.

    You only need to travel to certain regional centres to see the signs of a phantom recession. In retailing the sales volumes are down, in hospitality the bookings are down and in manufacturing the inventories are up. Yet go to some regionally centres and this may not be the case. If there is a major infrastructure project in that region, then economic conditions may be a lot more upbeat.

    This patchy economic activity pattern is hiding the real pain of the excessive official interest rate increases by the RBA. The RBA is quick to point to high inflation in Australia’s service sector. Yet it makes no mention of the low inflation in the manufacturing sector and the agricultural sector. Price gouging is also distorting the truth about inflation. Why certain companies are allowed to get away with price gouging will be forever a mystery. There is political blindness when it comes to price gouging by certain local supply firms. The transport industry in particular needs to be taken to task over excessive freight prices. Yet politicians sit back and do nothing.

    Until it is recognised that severe monetary policy tightening, unfairly penalises certain section sections of the economy, whilst largely not impacting other sectors in any negative way, the use of monetary policy will remain inequitable. The burden of interest rate rises is felt disproportionally hard on mortgage holders, fixed income earners, those with little or no wealth and the homeless. The social costs of excessively tight monetary policy include unemployment, domestic insecurity and social immobility.

    Phantom recessions are often left to run their own course. Any politician challenged to address lowering economic activity will tend to hide behind statistical averages like the CPI, GDP and export earnings. This at a time when people are losing their homes, their careers and their mental health. It is just not acceptable on any level that this must be tolerated just to satisfy some arbitrary inflation target range set up by the RBA.

  2. Butane cooking

    I’ve been banging a lonely drum for quite a while on the solution to the cookstove problem, viz. bottled butane. Many of the world’s rural poor cook indoors on wood or charcoal or dung fires, and it kills 3m of them every year says the WHO. Many do-gooders push impractical solutions like solar stoves for people who cook at night, or solar microgrids, where you need ridiculously oversized batteries to cope with the extremely peaky profile of energy demand for cooking. I was pleased to see that the IEA are pushing LPG as an immediate solution before everyone is on the World Sustainable Electric Grid: https://www.climatechangenews.com/2024/05/15/paris-summit-unlocks-cash-for-clean-cooking-in-africa-side-stepping-concerns-over-gas/ .

    What’s nice about this is that LPG gas bottles and stoves – butane for households, propane is for commercial use – are a completely mature technology and an existing business that only needs expanding. A butane bottle, like the Wehrmacht’s jerrycan, can be transported anywhere, by truck. trike, moped, donkey, camel, drone, or wheelbarrow. The holdout critics complain about the marginal lifeline to evil fossil gas companies like Total, but ignore that butane can easily be produced from unsustainable biomass. Google “bio-LPG” and you get page after page from gas companies selling it today, at a premium price of course. All you need for the switch is carbon pricing. Rural cooking, like long-distance aviation, is one of the few niches where biofuels will be needed for a long time. Even with fossil origin, the IEA says that the change to gas cuts net GHG emissions.

    Butane stoves are not completely harmless. The American Medical Association made waves by proposing a phaseout of gas cookers. Electric induction hobs are just as fast, easier to clean, safer, and more controllable at low heat. They are hogs for peak power: my basic 4-ring hob draws over 5 kw. Still, the residual health risks of butane are far lower than with biomass fires.

  3. It sounds like a wonderful advance for the cooks in Africa. (I haven’t cooked enough on gas to know if there is any sacrifice from a taste perspective. Plus who knows if I’d notice? The few times I’ve camped, someone else was in charge of the doohickey.)

    I find the layout of that chart in the linked piece to be non-intuitive. Though it does make the point. Next time they should put the lives saved on the chart too.

  5. 505,100

    The Ukrainian General Staff issues a daily report of claimed Russian losses (but not Ukrainian ones). Here is today’s:

    https://scontent.fgig4-1.fna.fbcdn.net/v/t39.30808-6/445746446_801848232128257_531026635336264356_n.jpg

    The total for personnel passed 500,000 a few days ago. The daily rate of 1300 is at the high end for recent weeks, but not a record.

    Can we believe them? Combatants usually exaggerate enemy losses. But the Pentagon estimated Russian ones as 315,000 as of December 12 2023, when the Ukrainian estimate was around 350,000, so the order of magnitude is credible. https://www.reuters.com/world/us-intelligence-assesses-ukraine-war-has-cost-russia-315000-casualties-source-2023-12-12/ The big difference is that the Pentagon includes wounded, while Ukraine claims killed. The Pentagon is probably right on this – but it does not matter much to the opposing army in a war of attrition. A wounded soldier is hors de combat just as much as a dead one.

    With tactics as profligate in lives as those of Verdun, Putin has burnt through the professional army with which he invaded Ukraine, and replaced it with semi-trained and partly coerced “volunteers” He has just about gone through replacement army 1 and will soon start on replacement army 2. Putin has rejected full mobilisation, probably to protect ethnic Russians in the heartlands of Moscow and St. Petersburg. Soldiers and hence casualties come disproportionately from non-Russian and generally poorer ethnic minorities.

    The respective populations in 2023 were: Ukraine 36.7m, Russia 144.4m, (3.9:1), both shrinking. Zelensky gave a total of 31,000 Ukrainian military deaths as of 25 February, when the UAF estimate of Russian deaths was 410,000 (13.2:1). Move half of the latter to wounded, the ratio drops to 6.6:1. Ukraine is still well ahead in demographic attrition. If the war just goes on and on, Russia runs out of bodies first.

    It won’t come to that. Outsiders marvel at Putin’s control of the domestic Russian information space. But it’s all an illusion. Ukraine is not run by Nazis, and its validly elected President is Jewish, native language Russian. It is not the puppet of NATO, which has denied Ukraine membership. The Ukrainian language is distinct from its close relative Russian, as Portuguese and Catalan are distinct from Spanish. Long stretches of Russian and Soviet rule have not made Ukraine culturally Russian, any more than centuries of rule from London have made Ireland part of England. The war was an unprovoked aggression by Russia. It failed in the attempt to instal a compliant quisling regime in Kyiv, and has no plausible military path to achieving this. The last six months of continuous and very costly Russian offensives have yielded insignificant territorial gains. Weapons and money are still flowing from NATO members to Ukraine, with delays and hiccups, as you would expect.

    Russians hear none of this. Putin’s Sleeping Beauty spell is far more comprehensive and fantastical than those of Goebbels and Stalin. The Kremlin did not have to invent bloodcurdling legends about what the Nazis had in mind for the populations of the vast Slavic territories they occupied, nor did Berlin need to gin up artificial fears of the revenge the Red Army would wreak on German civilian women. The reality was all they needed. All the belligerents in WW2 spun or hid the details of military operations, but they did not usually turn defeats into victories like Baghdad Bob and Putin.

    The contrast with Ukraine is total. Ukrainians live in the painful real world. They get reliable reports. Just now they are losing territory. Their enemies are badly trained, poorly equipped, and very badly led, but they keep coming. The terror missile attacks on civilians continue, and air defences against them are only partly successful. There are alarming signs of fatigue in some of their allies. And so on. But Ukrainians have no illusions to lose. They know exactly what Putin’s victory would mean for them, and they won’t stand for it. Zelensky has no need of making stuff up.

    The truth will out, even on Russian TV. How can it infiltrate the castle of lies? One path goes through the inexorably rising number of bereaved spouses, parents, siblings and close friends, and a parallel stream of wounded veterans. The latter know just how badly the war is going, and the former have a very strong incentive to find out. The mothers played a significant part in the Soviet withdrawal from Afghanistan, a much smaller war. Add to this the concentration of casualties among ethnic minorities, who speak within their immunity in a variety of non-slavic languages the FSB must find it hard to follow, and you have the potential for wide discontent and a loss of trust inPutin’s tame TV channels.

    The snap will be multi-factorial when it comes, and a surprise.

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