[picture is of fall of Berlin Wall, heralding what was thought to be a new era of peace and progress]…“A new geopolitical dark age is about to shatter the West’s fatal illusions
“Every so often, an earthquake rips through history, shattering the simple stories that help us to make sense of the world…. Hamas’s unprecedented assault… may… finally dismantle some of the fundamental assumptions that have underpinned the wider West’s perception of safety, heralding a new geopolitical dark age.”
“Global economy faces new age of volatility…
““Maybe the most dangerous time the world has seen in decades” …fears of a wider conflict in the Middle East have added to concerns for a global economy already rocked by war in Europe and still feeling the aftershocks of Covid-19… “Debt levels are at record levels and at the same time we are in this higher-for-longer interest [rate] environment. There is a lot . . . that could go wrong” said Gita Gopinath, deputy head of the IMF.”
“The world holds its breath: Israel-Palestine war dramatically escalates after hundreds die in Gaza hospital strike as Iran warns ‘time is up’ and Hezbollah calls for ‘day of rage’ – hours before Biden flies in to Tel Aviv…
“The hospital strike has sparked global anger, with Iran – Israel’s foe – declaring last night warning that the ‘time is up’ for the country and Tehran-backed terror group Hezbollah calling for a ‘day of rage’. ”
“Violent protests erupt across Middle East after Gaza hospital strike.
“US embassy in Lebanon is targeted with fire attack as angry demonstrations spread to Turkey, the West Bank and Tunisia… In Iran, hundreds of protesters gathered outside the British and French embassies in the early hours of Wednesday morning, chanting “death to France and England”.”
“Why has Jordan cancelled Biden visit after Israel bombing of Gaza hospital?
“It was to be a centrepiece of United States President Joe Biden’s visit to the Middle East on Wednesday: a trip to Jordan to meet a range of Arab leaders amid Israel’s incessant bombing of the Gaza Strip. But on Tuesday, Jordan cancelled that summit…”
“China and Russia harden positions on Gaza as war stirs geopolitical tensions.
“China and Russia have hardened their positions towards the conflict in Gaza in recent days, as the war between Israel and Hamas aggravates existing geopolitical tensions and underscores the growing gulf between the cold war allies and western powers such as the US, UK and France.”
“Biden to cut China off from more Nvidia chips, expand curbs to more countries.
“The Biden administration said on Tuesday it plans to halt shipments to China of more advanced artificial intelligence chips designed by Nvidia and others, part of a suite of measures aimed at stopping Beijing from getting cutting-edge U.S. technologies to strengthen its military.”
“US bond market is losing its strategic footing.
“it’s important to note that thee resilience of US Treasuries should not be taken for granted. No matter how you look at it, the world’s most crucial benchmark market is on an unpredictable journey with an uncertain destination.”
“President Joe Biden sold off nearly half the federal government’s oil reserve last year to stanch rising fuel prices after Russia invaded Ukraine.
“Republicans now argue that the drawdown has left the country vulnerable to a disruption of global oil supplies as violence between Israel and Hamas threatens regional conflict… Yet the country remains part of a global oil market — and even a fully stocked oil reserve wouldn’t fully insulate the nation from price shocks.”
“U.S. to ease sanctions on Venezuelan oil for freer presidential election…
“If the deal is signed, the U.S. government is prepared to announce the lifting of certain oil sanctions against Venezuela, the two people said. The sanctions relief could include a general license for Venezuela’s state-owned oil agency to resume business with the United States and other countries.”
“Environmentalists are gearing up for their next giant climate fight: They want to force a showdown with the Biden administration over the massive expansion of U.S. natural gas exports.
“Less than a decade ago, U.S. exports of liquefied natural gas — LNG for short — didn’t exist. Now they are growing so rapidly that the United States last year became the world’s largest gas exporter.”
“Why Biden’s multibillion-dollar bet on hydrogen energy is such a big deal.
“Clean hydrogen can be a lot dirtier than it seems, especially when the fossil fuel industry gets involved. One of the biggest bets of the Biden administration is that clean hydrogen will help the United States reach its climate goals, revitalize domestic manufacturing, and bolster a shrinking fossil fuel workforce. That’s a lot riding on an industry that barely exists today.”
“Hydrogen for home heating should be ruled out, infrastructure adviser says [UK]…
““We do not see any role for hydrogen in the future of home heating,” said Nick Winser, NIC commissioner, arguing it was “simply not ready at scale” and risked being an inefficient use of green electricity… The intervention comes as the government grapples with the dilemma of how to reach the UK’s 2050 net zero goal.”
“The UK is making a series of changes to its climate finance definitions as a way to meet its target to spend £11.6bn over five years in the developing world to help combat the climate crisis, Andrew Mitchell, the development minister, has said…
“Mitchell defended himself from the charge of a “sleight of hand” by describing the changes as “clarifications and not definitional changes.”
“The UK economy is in a “horrible fiscal bind” as it heads for recession and with no room to cut taxes or increase public spending amid mounting political pressure on the Chancellor to do so, according to a report.
“The Institute for Fiscal Studies (IFS) warned in its latest Green Budget that Britain will slump into a “moderate” recession in the first half of 2024 as borrowing costs stay elevated.”
“Humza Yousaf promises first ever Scottish bond in bid to revive independence.
“Scotland will borrow money from investors independently for the first time, Humza Yousaf has pledged, as the Scottish National Party seeks to reinvigorate the case for independence. The First Minister said Holyrood would sell the first ever Scottish bond by 2026…”
“An undersea telecommunications cable between Sweden and Estonia has been damaged, the Swedish government has said, the second such incident to be reported in the region in a week.
“Sweden’s civil defence minister, Carl-Oskar Bohlin, said the damage to the cable appeared to have happened at around the same time as an undersea gas pipeline…”
“Middle East crisis casts shadow over ECB meeting.
“The Israel-Hamas war is creating new challenges for Europe’s economy, from energy market disruption to an influx of refugees, Greece’s central bank governor has warned. Yannis Stournaras told the Financial Times that the turmoil in the Middle East shifted the balance against any further tightening of monetary policy.”
“Some of lost European gas demand may be gone for good – Vitol CEO…
“Some analysts say the price of reduced energy use could be a permanent contraction of industrial activity. Europe’s biggest economy Germany is expected to shrink this quarter as industry is in recession, according to the country’s central bank.”
“Germany Fires Up Extra Coal Unit to Help in Cold Snap…
“Last year’s historic energy crisis forced Germany to temporarily increase its reliance on the dirty fuel after supplies of Russian pipeline gas were shut off. While that poses a setback for the government’s plans to curb harmful emissions, it’s part of its strategy to contain price increases for consumers during the heating season.”
“Germany caves in to French demands over EU electricity market reform.
“Germany has given leeway for France to use state subsidies to fund its nuclear power plants, unblocking a long-stalled reform of the EU electricity market in the face of vast state aid regimes in China and the US.”
“Dutch Energy Minister Admits That Wind Power Agenda Is Pricier Than Anticipated…
“In a surprising announcement, Dutch Minister of Climate and Energy, Rob Jetten, has informed the market, government, and parliament that the costs of offshore wind projects in the North Sea will be significantly higher than previously assessed. Minister Jetten… has also indicated that consumers should expect substantially higher electricity prices than initially anticipated.”
“Exclusive: China instructs banks to roll over local government debt – sources.
“China has instructed state-owned banks to roll over existing local government debt with longer-term loans at lower interest rates, two sources with knowledge of the matter said, as part of Beijing’s efforts to reduce local debt risks in a faltering economy.”
“Former Bank of China boss arrested on corruption charges…
“China has arrested the former head of one of the country’s largest commercial banks on charges of accepting bribes and illegally granting loans, amid a two-year anti-corruption drive targeting the financial sector… President Xi Jinping has made fighting corruption a key part of his political project as he has cemented his position as paramount leader.”
“In Guatemala, Protests Have Brought Economic Life to a Halt.
“Millions of bananas are rotting in containers across Guatemala as the region’s largest economy grinds to a halt. Over the past 16 days, protests have left millions of Guatemalans confined to their homes, while the country runs out of food, fuel, and water.”
“Tunisia’s economy minister sacked amid unprecedented financial crisis.
“Tunisian President Kais Saied sacked the economy minister on Tuesday and appointed the finance minister to the role on an interim basis, the presidency announced without giving any explanation.”
“Pakistan’s ailing national carrier cancels 14 flights amid fuel shortage.
“Pakistan International Airlines (PIA) on Tuesday canceled 14 international and domestic flights due to fuel shortages after state-owned Pakistan State Oil (PSO) canceled supply over unpaid dues, a spokesman for the national carrier said.”
“Papua New Guinea: Fuel rationing measures ongoing nationwide as of Oct. 18…
“Puma Energy is restricting the distribution of fuel and rationing supplies in Papua New Guinea as of Oct. 18. The company stated that ongoing foreign exchange shortages are delaying payments for fuel. The duration of the rationing measures remains unclear.”
“World lacks enough LNG for energy transition, key trader says…
““Announced projects in the world still won’t make up for the supply needed when considering the energy transition that will take several decades,” said Kenichi Hori, president of Japanese trading house Mitsui & Co., in an interview in Tokyo last week. Hori echoed major exporters including Chevron and Shell…”
“Global electricity grid must be upgraded urgently to hit climate goals, says IEA…
“Fatih Birol, the executive director of the International Energy Agency, has warned that the equivalent of the entire global electricity grid – 80 million km of grid – needs to be added or refurbished by 2040 to hit climate targets and ensure reliable power supplies. Global investment in energy grids needs to double to more than $600bn (£492bn) a year…”
“Investment in climate technology has fallen by 40% in the last year, according to a report from PwC.
“The financial services giant’s State of Climate Tech report for 2023 analysed more than 8,000 climate tech start-ups and more than 32,000 deals worth more than £400 billion.”
“‘No question’ that the decarbonization of shipping will contribute to inflation, says industry CEO…
““There will be an inflationary impact coming from [the] decarbonization of shipping … there is no question of it,” Bertrand Chen, CEO of the Global Shipping Business Network, told CNBC’s East Tech West conference in the Nansha district of Guangzhou, China.”
“Central bankers fear energy, inflation shocks in chaotic climate transition.
“All this pushes central banks into uncharted waters, profoundly challenging their mandate to manage systemic risk, ensure price stability, and keep inflation low. Unlike previous historical monetary and economic shocks, there is no precedent for climate risk.”
“As global debt worries mount, is another crisis brewing?
“Record debts, high interest rates, the costs of climate change, health and pension spending as populations age and fractious politics are stoking fears of a financial market crisis in big developed economies. A surge in government borrowing costs has put high debt in the spotlight…”
You can read the previous “Economic” thread here. I’ll be back tomorrow with a “Climate” thread.
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