Cafe of Broken Dreams by John scientific terrorist in action

Rumors about Replacing the Dollar in the Crude Oil Market

Posted on October 6, 2009

Today there appeared some speculations on the Independent that Arab states started a deal with Russia, France and China about replacing the USD in the crude oil market. However the rumors has been after a while completely denied by all supposed participants.

This is not a new thing, a year ago I pointed out that behind the peak oil price was actually the value of the dollar and as a proof I have shown the oil price nominated in gold which is much more stable.

This oil-dollar peg has been point of many conspiracy theories that the USA controls all those countries and forces them to use the dollar. Which is, of course, as the most of conspiracy theories a non sense.

Anyone can trade a crude oil in any currency he want to, using the FX market (spot conversion is a matter of seconds). And anyone can calculate the crude oil price in any currency, using basic math of the elementary school level.

So why all of them has used the dollar? Because it was really profitable for them. And because it does not seems that good anymore, there are some talks about changing the dollar leading position.

Consider this, The Saudi Monetary Agency gained more than 1 trillion Saudi ryials  (cca 260 billions USD) just in 6 years due to the USD peg. All those money are saved somewhere all around the world, owned by someone in the government. (SAMA annual report, page 46). The same goes for China which gained much much more.

So talks about forcing someone are nonsense,  non-US governments will use the USD as long as it is profitable. When it stop being profitable they will simply switch to something different, which is China doing now, so far it has not been much successful.

UPDATE: Just realized that behind this report is 9/11 “Truther”  Robert Fisk, that explains all thought

Religious Roots of Liberty

Posted on August 26, 2009

Today I have read an interesting article about roots of freedom in religions, as the article had been written by a reverend, you rightly assume that the idea of freedom is to originate in Abrahamic religions, especially in its Judeo/Christian branch.

Well I don’t want to criticize his points in a much deep way, just if we want to see some monument in Palestine from the times of Israelites what about Solomon's Temple?

In fact we should not be surprised by the fact that some parts of our political philosophy might originate in religions, they are actually first attempts of people to understand the essence of life – philosophy. Ayn Rand said in an interview for Playboy:

You must remember that religion is an early form of philosophy, that the first attempts to explain the universe, to give a coherent frame of reference to man's life and a code of moral values, were made by religion, before men graduated or developed enough to have philosophy. And, as philosophies, some religions have very valuable moral points. They may have a good influence or proper principles to inculcate, but in a very contradictory context and, on a very - how should I say it? - dangerous or malevolent base: on the ground of faith.

Yes Religions stand behind the first ethical and sociological values and we also can find in them similarities to philosophy of liberty. But classical liberalism should not be used as  “propaganda” for confirmation of truthfulness of each religion.

Liberal Hindu or Buddhist can find reason for liberty in his religion texts, Chinese liberal fighting against oppressive communist government will use his books of Taoism and Muslims are today convinced that the European Renaissance has been imported to Europe due to Islamic philosophers like Ibn Rushd and that founder of liberal economics is Ibn Khaldun.

Whether or not we should also realize how has been religions effectively fighting against human liberty, in response to  Rev. Edmund A. Opitz:

Collectivist regimes, in the nature of things, must be profoundly irreligious, even to the extent of pressing a corrupted religion into service to shore up tyranny. via Mises.com

No they don’t, irreligious regimes based on the human reason and proclaiming liberty can be put into practice as easily as religious regimes. As well basics of  religious and irreligious regimes (faith and reason) can be easily stolen and used as an instrument of oppression.

Contribution to classical liberalism should not be associated to any particular religion group, but to few individuals who by their thoughts gave to the humanity a chance to prosper. The forefather of classical liberalism John Locke in fact opposed the classical Christian philosophy valid at that time.

In the end I will quote Steven Weinberg, a theoretical physicist challenging the classical idea that Christianity played a huge role in abolishment of slavery:

Where religion did make a difference, it was more in support of slavery than in opposition to it. Arguments from scripture were used in Parliament to defend the slave trade. Frederick Douglass told in his Narrative how his condition as a slave became worse when his master underwent a religious conversion that allowed him to justify slavery as the punishment of the children of Ham. Mark Twain described his mother as a genuinely good person, whose soft heart pitied even Satan, but who had no doubt about the legitimacy of slavery, because in years of living in antebellum Missouri she had never heard any sermon opposing slavery, but only countless sermons preaching that slavery was God’s will. With or without religion, good people can behave well and bad people can do evil; but for good people to do evil—that takes religion. see the whole great piece here

It is not about any religion it is about basic realization of violence and injustice.

In Defence of Pigs in Egypt

Posted on August 24, 2009

Recently I have read some posts of a typical pan-Arab ignoring some basic historical facts. And one her article came to my mind more closely, no I am not going to comment her fascistic attitude towards the Israeli Channel 2 as it has been already done by Carl from Jerusalem:

we would welcome Egyptians and Egyptian television to come here and 'return the favor' but they have no interest in doing so. – see the rest here

But about the funny, not so much for pigs, swine mass murder. Well I understand that some religion can convince people to stop using their reason, it is actually the basics of all faiths but let consider some scenarios/arguments.

Swine flue Epidemic Will Start

If this is going to happen it is a little bit late to kill all the pigs, we simply missed our chance, actually if this was really happened  it would have instantaneous effect on economy and mainly on food production. As I pointed before just now without any crisis in Egypt dies about 60 000 kids annually due to very poor economical development.  Now imagine a “defcon 1” situation when the food would became enormously limited resource, I bet many Muslims would then thank god for pigs, oh yes they could choose paradise instead.

Government Will Pay For Them

Why I always think, when I hear government’s great solution, that something is wrong here?

The Egyptian Government has allocated 1/2 billion pound to compensate the pigs raisers, I must hint that the poultry raisers have not recieved a penny from the government on their losses in the outbreak of H5N1 and the government already ignores compensating them – via Zeinboia

Well Egypt is known as inflation paradise country, currently practising Mugabe’s money theorem. Have you ever heard about the bubble in the USA? So one of the main reason was Mr. Allan Greenspan who were inflating M2 for 4,5% annually. Now guess what? For Egypt is not a problem to have 14% growth in bad times. I guess they are lucky that during Sadat’s and Nasser’s rule there were no statistics as would realise that Mubarak is not that bad.

Just for example in last decade Egyptian Pound lost more than 60% of its value to the Czech Crown – a currency of the country which national food contains pork and national drink is beer.

Fiat money compensation does not solve anything, it creates more problems and does harm the real economy!

Act of Prevention

Oh yes such a common utilitarian argument that from this action will benefit the whole society.

I am definitely, those dirty pigs should be eliminated as soon as possible ,we can’t jeopardize the life of millions for no good reason. – via Zeinboia

She has also provided us with a report about victims of Swine flue from the Minister of Health in Egypt.

Dear Zeinobia for last 6 years swine flue killed 260 people, Islamic terrorism has in the same time killed more than 100 000 people. And victims of Islamic Conquests are estimated to be more than 100 millions, there is one much bigger thing you can do for the case of humanity – stop being a Muslim.

Yes utilitarian arguments are stupid, but not always it must look so clearly anyway as we know human stupidity is endless so kill the pigs.

P.S. kill all chimpanzees, gorillas, and forest antelopes in Africa spreading Ebola, a virus 10 times more deadly than flu.  Kill all  Guinea-Bissaus and Gabons for spreading the H.I.V., in the end kill all the birds for the birds flu.

What could go wrong indeed.

Dumb-Jazeera How Israeli Boycott Kills Arabic Children

Posted on July 11, 2009

Its not so far when I pointed at a typical economical leftist nonsense in the New York Times, and just yesterday Al-Jazeera scored. Lets go to the video

information value = zero so at least enjoy a pretty journalist

How many times I will have to say that trade is not a zero sum game? From trade profits both sides! Any regulation against the voluntary trade will lead to decrease of wealth on both sides.

Farmers want to end imports from Israel, how bad must be those Israelis who can sell their products cheaper, and why any Jordanian farmers did not protest when they were selling food to Israel during the Shmitta year. Actually I have my doubts that 2000 tons of food will ruin Jordan agriculture as it produces only 166 000 tons of cereal per year. What about the whole food production then.

Anyway even if it was a true why is so bad that the people in Jordan will have cheaper food? But I have an idea , all those loosing farmers can buy that cheap food and sell it in Egypt, couldn’t they?

It would not work?! Have you ever heard about boycott? The Israeli “Apartheid” boycott exists because they want to stop the killing of kids. Well it is not a bad idea isn’t it? There are now two kind of boycotts first is voluntary organized (by the way the site is using an Israeli technology) and second is organized by the Arab League.

But here still obtains that any forced boycott will harm both sides. For example Strategic Foresight Group had calculated that Arab states have lost an opportunity to export $10 billion worth of goods to Israel between 2000-2010.

Now do you know what is the biggest killer in the world? This is an example from great episode of  20/20 broadcasted many years ago.  (you can see worth of watching episode here)

risk

even in modern countries is the biggest killer poverty

By the way in Egypt for example organization Save the Children estimates that every year die about 60 000 kids as the result of the extremely big death rate for children under the age of five.

So I am just suggesting why the economy which have huge water consumption (4 times more than Israel per capita) and not developed agriculture if the world leader in agriculture is next door.

Just imagine if that rate fell only for 10% it would save 6 000 kids per year. For example between 2000 – 2007 has been killed about 1000 Palestinian kids by Israel, according to B’tselem (note that they are not much kosher numbers). Former Prime Minister of Israel Golda Meir once said: "

Peace will come when the Arabs will love their children more than they hate us

I know she was talking about suicide bombers, but with the boycott we are reaching absolutely new level. So who is actually bigger bad guy if 42 000 kids could be saved by cancellation of the boycott or if 1000 kids could be saved by “wiping Israel out of the map”?

Crude oil price is stable like never before

Posted on December 13, 2008

In last days when crude oil prices reached 150 USD and then have been falling down to the 40 USD would be probably very strange to talk about stability in crude oil market. But there is something you should know.

Brent monthly average price

Brent monthly average price 

To be specific many people are making a big mistake just because they’ve accepted money as a universal measure for value! This is certainly not true at all. Money does not have standardized value  like meters, miles or minutes!

Imagine If I had enough power and influence to force the world to trade crude oil for one of my Adidas T-shirt model. In the beginning crude oil price would be very high because supply of  these T-shirts would be very low. (thousands of barrels for one T-shirt) But If China noticed it and started to produce my T-shirt model, price would rapidly change direction. (one barrel for thousands T-shirts). All of this could happen with no change in supply and demand for crude oil.

image

Oil price in gold

The picture above shows price we could see today if Nixon hadn’t canceled convertibility of the USD to gold. No peaks, no bubbles and stability. It’s obvious why was price in last decade much more stable than in previous because markets has been developing much more quicker than never before  (open electronic markets, creation of ICE – Inter Continental Exchange) that means competition on the markets rapidly rose and that has been helping to push the price in the ideal point.

It’s bit amusing to see how politics are speaking about necessity to regulate these markets and restrict speculation even if this speculation significantly do help. There is only one sick medium in crude oil market it’s the USD (which is completely government regulated) especially then its infinite production. Because making new dollars is much easier than making new gold bricks.