News roundup for Fri, Jun 17, 2022

In short:
  • The US Federal Reserve, Bank of England, and Swiss National Bank all raised interest levels in extraordinary ways to counteract inflation
  • Abbott’s baby formula factory closed again due to floods
  • Thousands of cattle have died in Kansas due to heat stress
Economy, food security

The US Federal Reserve approved the biggest interest rate hike in 28 years. This is the third hike this year, and the largest since 1994. A half-point increase was expected, but the Fed took a more drastic measure after the latest consumer price report came out on June 10. The Fed is expected to raise rates four more times by the end of the year. Here’s an explainer about the move, and its possible consequences for both the US and the global economy. Opinion: ‘We are going to go into a really fast recession.’  A different point of view: Here’s why we are not at risk of a 70s-style recession. Bloomberg predicts the US will face a recession in Q1 2024:

On the European front, the Bank of England raised interest rates for the fifth time this year, the Swiss National Bank raised interest rates for the first time in 15 years, and the European Central Bank will raise interest rates in July.

Bitcoin lost 50% of its value this year, and Coinbase is laying off 18% of its full-time employees, in preparation for recession and a ‘crypto winter.’ Here’s an explainer of what ‘crypto winter’ means, and here’s a short opinion piece about how long will it last.

Continuing on the explainer wagon, here’s what it means that the stock market has entered ‘bear’ territory.

Abbott’s baby formula factory closed again due to floods and will reopen in a few weeks. The company says it “has ample existing supply of EleCare” and other specialty formulas to last consumers until more is available.

Why should investors care about the environment? Some reasons why:

  • $44 trillion of the world’s economic output is dependent on animals and ecosystems
  • About three-quarters of the world’s food crops are pollinated by birds, bees, and other insects and small animals
  • The population of birds, mammals, fish, reptiles, and amphibians has declined by 68% between 1970 and 2016

Case in point, thousands head of cattle in Kansas have died due to sharp temperature increases, humidity, and lack of wind. Each animal would have been worth around $2,000. According to a recent study, the global cattle farming industry will lose $15 to $40 billion every year by the end of the century, and beef and dairy production in the US will drop almost 7%. And people will lose food.

Gas, energy

An explosion shut down the Freeport, TX liquefied natural gas terminal, blocking exports to Europe and elsewhere. Freeport accounts for roughly 20% of the US LNG processing capacity. The terminal will reopen later this year.

Eight million people in Australia have been asked to turn off electricity for two hours every evening in order to prevent blackouts. Australia just went through the coldest start of winter in a long time. Here’s an explainer of Australia’s energy crisis.

Romania could become Europe’s energy power center. The previous regime left the country with two power plants and two more awaiting completion, and the possibility to take advantage of offshore gas fields in the Black Sea.

Climate, extreme weather

The latest NOAA report shows that May 2022 was the ninth warmest in 143 years, and the year is the sixth warmest on record. More extreme events for May:

A map of the world plotted with some of the most significant climate events that occurred during May 2022. Please see the story below as well as more details in the report summary from NOAA NCEI at link. (NOAA/NCEI)

La Niña is heading for a rare third year. If it happens, it would only be the third time since 1950. La Niña will keep worsening drought and fire risks in the Southwest, cold and stormy winters in the North (and Australia), intensifying spring tornadoes and bolstering the Atlantic hurricane season. Food for thought: la Niña cools down water temperatures in the Pacific, so this year’s temperatures would have been even higher if it wasn’t for La Niña. 🤯

Over a third of the US population (more than 125 million people) was urged to stay indoors amid record heat.  A water line in Texas broke and left 165,00 houses and businesses without water while experiencing 100+ temperatures. The water treatment plant is back online and residents are under water boil notice for at least until Friday.

A river in Yellowstone National Park was pushed off course (maybe permanently) by heavy rain and rapid snowmelt. Hundreds of homes were damaged and 10,000 visitors were evacuated, but no one was hurt. Satellite photos show the devastation. The flood knocked out a water treatment plant and residents have been told to ration water or it will run out within 36 hours. The park could shut down for a week, and the northern entrances may not open until next summer. More flooding is forecast for this week.

More than 30 wildfires have burned on Monday, scorching about one million acres across five states, and causing evacuations in Arizona and California.

California is facing drought, heat, power outages, and fires—all at once.

I often post relevant guides on how to prep for a whole range of scenarios, but this time I want to highlight this DIY rain barrel water collector by community member brownfox-ff. Just make sure to check your local water collecting laws before starting this or a similar project.

Hundreds of baby birds have recently died in Spain after leaving the nest prematurely to escape the heat. Spain is experiencing the earliest heat waves in 40 years. And New Zealand penguins have been dying off in the hundreds because high ocean temperatures are disrupting their food chain.

Rising sea levels are threatening 200,000 homes in England. The South West, North West, and East Anglia have the highest number of properties at risk of flooding:

The rest

Covid vaccinations for children under 5 could start as early as Tuesday. The state of Florida won’t be ordering the vaccines, but doctors, hospitals, and community centers can still order them.

The WHO will decide on June 23 whether to declare the monkeypox outbreak a public health emergency of international concern. Dr. Hans Kluge, the center’s director for Europe, said the outbreak is a real threat to public health, and the longer it circulates, the more people it could affect. WHO is procuring thousands of monkeypox tests for Africa but is not recommending mass vaccination at this stage.

An ad tracker is sending sensitive medical information to Facebook from hospital websites.

Scientists have mapped the best and worst places in the USA to be during a severe geomagnetic storm. The East coast is especially vulnerable.



    • Pops

      Thanks for your work Carlotta! Here’s my contribution:

      Because the government has ended QE  (near-unlimited buying of mortgages to stimulate lending and so the economy) and begun QT (the opposite), the interest cost of buying a home has doubled.
      “The monthly mortgage payment on the median asking price home increased to $2,514 at the current 5.78% mortgage rate. This was up 49% from $1,692 a year earlier, when mortgage rates were 2.93%.” Redfin

      As well the cost of homes that had been rising 15-30% per year because of pent up demand in addition to those artificially low interest rates.

      That trend will now reverse. Obviously, recent home buyers will end up underwater, to say nothing of the poor souls who took out ARMs, bought stocks and got suckered into crypto.

      And the 9 trillion dollars the fed conjured from thin air? It has has trickled up as designed and is now busy offgassing from the stock and crypto ponzi parlors.

      Same as it ever was.

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    • Karl Winterling

      I hope Michael Novogratz understands “collapse” to mean “economic contraction and decline in stock prices” rather than “no gas in gas stations and no food in grocery stores for the foreseeable future, so we’ll all have to learn to walk more and eat food from restaurants and farmers’ markets.”

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      • Greg P Karl Winterling

        He appears to be a big cryptocurrency guy – I’m thinking “collapse” means that crypto will tank and he will have to put off buying that new Rolls Royce for a while (LOL).

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      • Karl Winterling Greg P

        Cryptocurrency is still speculative because it hasn’t gotten to a point where it’s more secure and convenient than credit cards and debit cards. There are high transaction fees and the Bitcoin network’s transactions per second are much lower than the transactions per second that a network like Visa or Mastercard processes. Bitcoin can’t be a “store of value” unless more people agree it has value and use it to make purchases.

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      • Karl Winterling Greg P

        What’s worrisome, though, is the emotional component behind the collapse in cryptocurrencies and whether that fear could spread to other asset classes. Cryptocurrency is currently regulated by the SEC rather than the Commodity Futures Trading Commission, though.

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    • Captain Peanut

      My main takeaway from this news roundup is to prepare for extreme heat, and electricity and water shutoff. 

      I like the rain collection recommendation, it will be nice to have that backup source of water in case your city water gets shut off.

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    • Lara B

      Carlotta, if the measure of the blog post is how many of the articles I clicked and followed through and read on, this post was stellar! Thank you.  Lara

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