China’s shadow banking system is out of control and under mounting stress as borrowers struggle to roll over short-term debts, Fitch Ratings has warned.
By Ambrose Evans-Pritchard, International Business Editor
4:12PM BST 16 Jun 2013
The agency said the scale of credit was so extreme that the country would find it very hard to grow its way out of the excesses as in past episodes, implying tougher times ahead.
“The credit-driven growth model is clearly falling apart. This could feed into a massive over-capacity problem, and potentially into a Japanese-style deflation,” said Charlene Chu, the agency’s senior director in Beijing.
“There is no transparency in the shadow banking system, and systemic risk is rising. We have no idea who the borrowers are, who the lenders are, and what the quality of assets is, and this undermines signalling,” she told The Daily Telegraph.
While the non-performing loan rate of the banks may look benign at just 1pc, this has become irrelevant as trusts, wealth-management funds, offshore vehicles and other forms of irregular lending make up over half of all new credit. “It means nothing if you can off-load any bad asset you want. A lot of the banking exposure to property is not booked as property,” she said.
Concerns are rising after a string of upsets in Quingdao, Ordos, Jilin and elsewhere, in so-called trust products, a $1.4 trillion (£0.9 trillion) segment of the shadow banking system.
Bank Everbright defaulted on an interbank loan 10 days ago amid wild spikes in short-term “Shibor” borrowing rates, a sign that liquidity has suddenly dried up. “Typically stress starts in the periphery and moves to the core, and that is what we are already seeing with defaults in trust products,” she said.
Fitch warned that wealth products worth $2 trillion of lending are in reality a “hidden second balance sheet” for banks, allowing them to circumvent loan curbs and dodge efforts by regulators to halt the excesses.
This niche is the epicentre of risk. Half the loans must be rolled over every three months, and another 25pc in less than six months. This has echoes of Northern Rock, Lehman Brothers and others that came to grief in the West on short-term liabilities when the wholesale capital markets froze.
Mrs Chu said the banks had been forced to park over $3 trillion in reserves at the central bank, giving them a “massive savings account that can be drawn down” in a crisis, but this may not be enough to avert trouble given the sheer scale of the lending boom.
Overall credit has jumped from $9 trillion to $23 trillion since the Lehman crisis. “They have replicated the entire US commercial banking system in five years,” she said.
The ratio of credit to GDP has jumped by 75 percentage points to 200pc of GDP, compared to roughly 40 points in the US over five years leading up to the subprime bubble, or in Japan before the Nikkei bubble burst in 1990. “This is beyond anything we have ever seen before in a large economy. We don’t know how this will play out. The next six months will be crucial,” she said.
The agency downgraded China’s long-term currency rating to AA- debt in April but still thinks the government can handle any banking crisis, however bad. “The Chinese state has a lot of firepower. It is very able and very willing to support the banking sector. The real question is what this means for growth, and therefore for social and political risk,” said Mrs Chu.
“There is no way they can grow out of their asset problems as they did in the past. We think this will be very different from the banking crisis in the late 1990s. With credit at 200pc of GDP, the numerator is growing twice as fast as the denominator. You can’t grow out of that.”
The authorities have been trying to manage a soft-landing, deploying loan curbs and a high reserve ratio requirement (RRR) for banks to halt property speculation. The home price to income ratio has reached 16 to 18 in many cities, shutting workers out of the market. Shadow banking has plugged the gap for much of the last two years.
However, a new problem has emerged as the economic efficiency of credit collapses. The extra GDP growth generated by each extra yuan of loans has dropped from 0.85 to 0.15 over the last four years, a sign of exhaustion.
Wei Yao from Societe Generale says the debt service ratio of Chinese companies has reached 30pc of GDP – the typical threshold for financial crises — and many will not be able to pay interest or repay principal. She warned that the country could be on the verge of a “Minsky Moment”, when the debt pyramid collapses under its own weight. “The debt snowball is getting bigger and bigger, without contributing to real activity,” she said.
The latest twist is sudden stress in the overnight lending markets. “We believe the series of policy tightening measures in the past three months have reached critical mass, such that deleveraging in the banking sector is happening. Liquidity tightening can be very damaging to a highly leveraged economy,” said Zhiwei Zhang from Nomura.
“There is room to cut interest rates and the reserve ratio in the second half,” wrote a front-page editorial today in China Securities Journal on Friday. The article is the first sign that the authorities are preparing to change tack, shifting to a looser stance after a drizzle of bad data over recent weeks.
The journal said total credit in China’s financial system may be as high as 221pc of GDP, jumping almost eightfold over the last decade, and warned that companies will have to fork out $1 trillion in interest payments alone this year. “Chinese corporate debt burdens are much higher than those of other economies. Much of the liquidity is being used to repay debt and not to finance output,” it said.
It also flagged worries over an exodus of hot money once the US Federal Reserve starts tightening. “China will face large-scale capital outflows if there is an exit from quantitative easing and the dollar strengthens,” it wrote.
The journal said foreign withdrawals from Chinese equity funds were the highest since early 2008 in the week up to June 5, and withdrawals from Hong Kong funds were the most in a decade.
Having exposed the “biggest scam in history” is Part 4 (following Part 1, Part 2, and Part 3), Mike Maloney’s fifth episode serves as an ideal primer for those waking up to the monetary matrix around them, as it clearly shows the history of true money and why it so important to our freedom. The quality of a society is directly proportional to the quality of its money. Debase a currency for long enough, and you end up with dangerous deficits, debt driven disasters, and eventually…delusional dictators. History proves this to be true.
The concept of the “liquidity trap” is well-known to most: it is that freak outlier in an otherwise spotless Keynesian plane, when due to the need for negative interest rates to boost the economy (usually resulting from that other inevitable Keynesian state: the bursting of an asset bubble) – a structural impossibility according to most economists although an increasingly more probable in Europe – central banks have no choice but to offset a deleveraging private banking sector and directly inject liquidity into the banking sector with the outcome being soaring asset prices, and even more bubbles which will eventually burst only to be replaced with even more failed attempts at reflation. Sadly, very little of this liquidity makes its way to the broad economy as the ongoing recession in the developed world has shown for the 5th year in a row, which in turn makes the liqudity trap even worse, and so on in a closed loop.
Since there is little else in the central bankers’ arsenal that is as effective in boosting the “wealth effect” – which is how they validate their actions to themselves and other economists and politicians – they continue to do ever more QE. And since banks are assured at generating far greater returns on allocated capital in the markets, where they can use the excess deposits they obtain courtesy of the Fed’s generous reserve-a-palooza as initial margin for risk-on trades, the liquidity pipelines remain stuck throughout the world, and loan creation – that traditional money creation pathway – is permanently blocked (as is the case empirically in both the US and Europe, where private-sector loan creation is declining at a record pace).
Everywhere except the one place that has yet to actually engage in conventional quantitative easing: China. At least explicitly, because loan creation by China’s state-controlled entities and otherwise government backstopped banks, is anything but conventional money creation. One can, therefore, claim that China’s loan creation is a form of Quasi-QE whereby banks, constrained from investing in a relatively shallow stock market, and unable to freely transfer the CNY-denominated liquidity abroad, are forced to lend it out knowing that if things turn soure at the end of the day, the PBOC will bail them out. Paradoxically, this “non-QE” is exactly how QE should work in the US and other developed markets.
That’s the long story.
The short story is far simpler.
In order to offset the lack of loan creation by commercial banks, the “Big 4” central banks – Fed, ECB, BOJ and BOE – have had no choice but the open the liquidity spigots to the max. This has resulted in a total developed world “Big 4” central bank balance of just under $10 trillion, of which the bulk of asset additions has taken place since the Lehman collapse.
How does this compare to what China has done? As can be seen on the chart below, in just the past 5 years alone, Chinese bank assets (and by implication liabilities) have grown by an astounding $15 trillion, bringing the total to over $24 trillion, as we showed yesterday. In other words, China has expanded its financial balance sheet by 50% more than the assets of all global central banks combined!
And that is how – in a global centrally-planned regime which is where everyone now is, DM or EM – your flood your economy with liquidity. Perhaps the Fed, ECB or BOJ should hire some PBOC consultants to show them how it’s really done.
One of the notable developments in the neverending China-Japan territorial sovereignty dispute over various rock formations (and potential massive natural resources located beneath them) in the East China Sea, has been China’s launch of an “air defense zone” over said disputed islands. As AP reported previously, Beijing on Saturday issued a map of the zone — which includes a cluster of islands controlled by Japan but also claimed by China — and a set of rules that say all aircraft entering the area must notify Chinese authorities and are subject to emergency military measures if they do not identify themselves or obey Beijing’s orders. Various Japanese airlines responded in a confused manner overnight, with neither JAL nor ANA sure whether or not to comply with China’s new demand which is merely the latest territorial escalation.
Yet the declaration seems to have flopped as a foreign policy gambit. Analysts say Beijing may have miscalculated the forcefulness and speed with which its neighbors rejected its demands. “Washington, which has hundreds of military aircraft based in the region, says it has zero intention of complying. Japan likewise has called the zone invalid, unenforceable and dangerous, while Taiwan and South Korea, both close to the U.S., also rejected it.”
To put an end to any debate of how the US really feels about China imposing what it believes is its own territoria sovereignty, moments ago the WSJ reported that, in a direct challenge to China, or perhaps provocation, “a pair of American B-52 bombers flew over a disputed island chain in the East China Sea without informing Beijing, U.S. officials said Tuesday, in a direct challenge to China and its establishment of an expanded air defense zone.
Defense officials earlier had promised that the U.S. would challenge the zone and would not comply with Chinese requirements to file a flight plan, radio frequency or transponder information.
The flight of the B-52s, based at Anderson Air Force Base in Guam, were part of a long planned exercise called Coral Lightening. The bombers were not armed and were not accompanied by escort planes.
While the probability of a direct Chinese retaliation against the US is slim to none, it is quite possible that the Chinese will once again redirect their nationalist anger toward Japan, in a repeat of what happened a year ago when the Japanese government escalated the Senkaku Island confrontation, leading to a purge of Japanese business interests (and citizens) from the mainland, and a collapse of all Japanese exports to China. And since one of Abenomics key “arrows” is boosting exports, the last thing the economy, which already hangs by a thread, needs is another economic embargo by one of its largest trading partners. We will find out if China reacts in such a fashion shortly.
Below we present a twitter exchange we had with a Japanese media outlet overnight on Twitter. It needs no commentary.
In the early 1960s, the USSR committed an act of aggression against the US. It provided a smaller nation on the other side of the Atlantic Ocean (Cuba) with the ability to become a nuclear power. As Cuba was near to the US, this arming of Cuba posed a direct threat to the US.
The situation was considered so great a threat to the US that President John Kennedy risked starting a world war to have the nuclear weapons removed.
War was averted (barely), and the US has been patting itself on its back ever since for standing up for its stance on “world freedom from nuclear war.”
That’s essentially the story as it has come down to us.
Today, in the Middle East, we have a situation in which Iran is enriching uranium—purportedly for peaceful purposes. The US government states regularly that this cannot be tolerated—that, if necessary, the US may need to take up arms against Iran to make sure that they never use their uranium to develop an atomic bomb.
This stance is presented to the American people as being in keeping with its former opposition regarding Cuba—a stance for world freedom from nuclear war. (The mind conjures up an image of John Kennedy and Barrack Obama standing together in front of an American flag, waving in the breeze.)
But let’s take a step back here for a moment and ask ourselves if there is a true parallel between the Cuban Missile Crisis and the present stance of the US government.
If we were to rewrite the first paragraph in this article, plugging in the names of countries that are most appropriate, we come up with the following:
The US committed an act of aggression against the Middle East. It provided a smaller nation on the other side of the Atlantic Ocean (Israel) with the ability to become a nuclear power. As Israel was in the Middle East, this arming of Israel posed a direct threat to the Middle East and Russia.
The level of assistance that the US provided to Israel can be debated, but, to be sure, the US has contributed billions of dollars, plus provided extensive military expertise to Israel over the years. Today, although Israel refuses to confirm its possession of nuclear warheads, the best estimates suggest that it possesses close to two hundred nuclear weapons and can reportedly create another hundred weapons if need be.
Although Israel is recognised as the sixth country in the world to develop nuclear weapons, it is not recognised as a Nuclear Weapons State under the Nuclear Non-Proliferation Treaty (NPT). To date they have refused to sign the NPT and, accordingly, are not monitored in any way internationally.
Somehow, the Western press have managed to overlook the rather large elephant in the room.
Astoundingly, it is forbidden for US politicians to even acknowledge that Israel has nuclear weapons (see this video).
Iran might develop a nuclear weapon, and it might not. (Uranium is not used only for nukes—it has other non-military uses.) In addition, creating a nuclear warhead would take them years. To date the only “proof” that Iran might create a nuke is that provided by the UN stating that they have received “intelligence” to that effect from an unnamed country, assumed to be Israel.
Those readers who remember the US foray into Iraq a decade ago will remember that the invasion was based upon the “certainty” from intelligence that Iraq possessed “weapons of mass destruction.” Although no trace of any such weapons was ever found, the US did not bother to apologise for this minor oversight after its goal of conquering Iraq had been achieved.
To add further to this imbalance in the possession of nukes, the Saudis have allegedly purchased nukes from Pakistan (which are available to be delivered at a moment’s notice), leap-frogging them ahead of Iran; yet, the Western world offers no criticism of this potential for aggression. But then, Saudi Arabia is the lynchpin to the petrodollar system.
It has been said by many historians over the ages that when an empire is reaching a stage of economic collapse, its leaders commonly turn to the distraction of warfare in order to remain in power a bit longer. Indeed, this has been the case throughout history, and it has been proven to be an effective ploy.
If a country is on the economic ropes and is due for a fall, there are two major advantages to creating an excuse to go to war.
First, war creates a distraction. It keeps the population’s eye off the economic ball sufficiently enough to allow the government to continue its destructive economic policies a while longer—postponing, but not eliminating the inevitable.
Second, a country at war is, in effect, in an “emergency” situation. Invariably, its government uses the opportunity to “temporarily” remove freedoms (which may not be reinstated after the war). The government therefore has the ability to diminish the rights of its people with impunity, thereby creating a greater control over them.
Although the majority of the people of the US have not supported attacking the Middle East as the government has wished, the government continues to push for war. In the UK, the government has similarly been pressed by its people to stand down.
So, how will this play out? Will the governments drop the scam? Not likely. After all, theyneed their distraction, or the main issue will once again become the economy.
Traditionally, in such circumstances (The Spanish-American War, World War I, World War II, Vietnam, etc.), one of three tactics is employed by a government that is determined to go to war but is having a rather dodgy time convincing its public to move ahead:
- Create a false-flag attack (Spanish-American War, German invasion of Poland, etc.)
- Claim to have been attacked when no attack has taken place (Vietnam—Gulf of Tonkin)
- Prod the opposition until they respond by attacking (World War I, World War II, etc.)
Each of the above is extraordinarily easy to do. It could be as simple as sending an American ship into the Strait of Hormuz, where it is then sunk. It is then simple enough to arrange for “witnesses” to be interviewed who will say they saw an attack by “the enemy.” (Syrians, Iranians, Russians—take your pick.)
The people of a country are rarely fooled into going to war as a “humanitarian obligation.” They are almost always pushed over the edge when they have been fooled into believing that they are under a personal threat of some kind.
We should therefore not expect to see Israel deprived of its nuclear power. Instead, we should expect to see the next World War triggered by some small, questionable event. When that happens, we should also expect to see the rights of those who live in allied countries removed in a way not hitherto imagined.
If the reader currently lives in a country where rights are already eroding rapidly, he may wish to consider the potential for further loss, under the pretext of a “national emergency.”
Editor’s Note: Internationalization is your ultimate insurance policy. Whether it’s with a second passport, offshore physical gold storage, or other measures, it is critically important that you dilute the amount of control the bureaucrats in your home country wield over you by diversifying your political risk. Watch Doug Casey discuss this important topic in a new video interview by clicking here.
China Bond Yields Soar To 9 Year Highs As It Launches Crackdown On “Off Balance Sheet” Credit | Zero Hedge
As we showed very vividly yesterday, while the world is comfortably distracted with mundane questions of whether the Fed will taper this, the BOJ will untaper that, or if the ECB will finally rebel against an “oppressive” German regime where math and logic still matter, the real story – with $3.5 trillion in asset (and debt) creation per year, is China. China, however, is increasingly aware that in the grand scheme of things, its credit spigot is the marginal driver of global liquidity, which is great of the rest of the world, but with an epic accumulation of bad debt and NPLs, all the downside is left for China while the upside is shared with the world, and especially the NY, London, and SF housing markets. Which is why it was not surprising to learn that China has drafted rules banning banks from evading lending limits by structuring loans to other financial institutions so that they can be recorded as asset sales,Bloomberg reports.
Specifically, China appears to be targeting that little-discussed elsewhere component of finance, shadow banking. Per Bloomberg, the regulations drawn up by the China Banking Regulatory Commission impose restrictions on lenders’ interbank business by banning borrowers from using resale or repurchase agreements to move assets off their balance sheets. Banks would also be required to take provisions on such assets while the transactions are in effect. Ironically, it may be that soon China will be more advanced in recognizing the various exposures of shadow banking than the US, which is still wallowing under FAS 140 which allows banks to book a repo as both an asset and a liability.
Recall from a Matt King footnote in his seminal “Are the Brokers Broken?”
Quite apart from the fact that FAS 140 contradicts itself (with paragraph 15 (d) making borrowed versus pledged transactions off balance sheet, and paragraph 94 making them on balance sheet, a topic complained about by many broker-dealers immediately after its issue), there seems to be little consensus as to who is the borrower and who is the lender. As far as we can tell, terms like ‘borrower’ and ‘lender’ are used in exactly the opposite sense in the accounting regulations relative to standard market practice. The description above follows common market practice. The accounting documents seem to refer to this the other way around, a source of confusion commented upon in some of the accounting literature
So while in the US one may be a borrower or a lender at the same time courtesy of lax regulatory shadow banking definition (depending on how much the FASB has been bribed by the highest bidder), in China things will very soon become far more distinct:
The rules would add to measures this year tightening oversight of lending, such as limits on investments by wealth management products and an audit of local government debt, on concerns that bad loans will mount. The deputy head of the Communist Party’s main finance and economic policy body warned last week that one or two small banks may fail next year because of their reliance on short-term interbank borrowing.
“China’s banks and regulators are playing this cat-and-mouse game in which the banks constantly come up with new gimmicks to bypass regulations,” Wendy Tang, a Shanghai-based analyst at Northeast Securities Co., said by phone. “The CBRC has no choice but to impose bans on their interbank business, which in recent years has become a high-leverage financing tool and may at some point threaten financial stability.”
Cutting all the fluff aside, what China is doing is effectively cracking down on the the wild and unchecked repo market, and specifically re-re-rehypothecation, which allows one bank to reuse the same ‘asset’ countless times, and allow it to appear in numerous balance sheets.
The proposed rules target a practice where one bank buys an asset from another and sells it back at a higher price after an agreed period.
The reason why China is suddenly concerned about shadow banking is that it has exploded as a source of funding in recent years:
Mid-sized Chinese banks got 23 percent of their funding and capital from the interbank market at the end of 2012, compared with 9 percent for the largest state-owned banks, Moody’s Investors Service said in June. The ratings company forecast a further increase in non-performing loans as weaker borrowers find it hard to refinance.
And while we are confident Chinese financial geniuses will find ways to bypass this attempt to curb breakneck credit expansion in due course, in the meantime, Chinese liquidity conditions are certain to get far tighter.
This is precisely the WSJ reported overnight, when it observed that yields on Chinese government debt have soared to their highest levels in nearly nine years amid Beijing’s relentless drive to tighten the monetary spigots in the world’s second-largest economy. “The higher yields on government debt have pushed up borrowing costs broadly, creating obstacles for companies and government agencies looking to tap bond markets. Several Chinese development banks, which have mandates to encourage growth through targeted investments, have had to either scale back borrowing plans or postpone bond sales.”
This should not come as a surprise in the aftermath of the recent spotlight on China’s biggest tabboo topic of all: the soaring bad debt, which is the weakest link in the entire, $25 trillion Chinese financial system (by bank assets). So while the Fed endlessly dithers about whether to taper, or not to taper, China is very quietly moving to do just that. Only the market has finally noticed:
The slowing pace of bond sales from earlier in the year is reviving worries of reduced credit and soaring funding costs that were sparked in June, when China’s debt markets were rattled by a cash crunch.
The rise in borrowing costs and shrinking access to credit could undercut the recent uptick in China’s economy that global investors in stock, commodity and currency markets have cheered. Wobbly growth in China could undermine economic recovery in the rest of the world.
“If borrowing costs don’t fall in time, whether the real economy could bear the burden is a big question,” said Wendy Chen, an economist at Nomura Securities.
Chinese bond yields are rising amid a lack of demand among the big banks, pension funds and other institutional money managers, analysts say. These investors, traditionally the heavyweights in China’s bond market, have seen their funding costs rise in tandem with interbank lending rates, which are controlled by China’s central bank. The country’s bond market is largely closed to foreign investors.
The yield on China’s benchmark 10-year government bond was at 4.65% Monday, down from 4.71% Friday. Last Wednesday’s 4.72% was the highest since January 2005, according to data providers WIND Info and Thomson Reuters. The record is 4.88% set in November 2004. Bond yields and prices move in opposite directions.
“The recent sharp rise in bond yields was mostly due to worsening funding conditions and growing expectations for a tighter monetary policy as Beijing seeks to deleverage the economy,” said Duan Jihua, deputy general manager at Guohai Securities.
As government-bond yields have risen, the average yield on debt issued by China’s highest-rated companies rose to 6.21% as of Friday—the highest since 2006, when WIND Info began compiling the data.
In conclusion, it goes without saying that should China suddenly be hit with the double whammy of regulatory tightening in both shadow and traditional funding liquidity conduits, that things for the world’s biggest and fastest creator of excess liquidity are going to turn much worse. We showed as much yesterday:
If the Chinese liquidity spigot – which makes the Fed’s and BOJ’s QE both pale by comparison – is indeed turned off, however briefly, then quietly look for the exit doors.
KINCARDINE, Ont. – Ordinarily, a proposal to bury radioactive waste in a scenic area that relies on tourism would inspire “not in my backyard” protests from local residents — and relief in places that were spared.
But conventional wisdom has been turned on its head in Ontario, where a publicly owned power company wants to entomb waste from its nuclear plants 680 metres below the surface near Lake Huron.
Some of the strongest support comes from Kincardine and other communities near the would-be disposal site at the Bruce Power complex, the world’s largest nuclear power station, which produces one-fourth of all electricity generated in Canada’s most heavily populated province. Nuclear is a way of life here, and many residents have jobs connected to the industry.
Meanwhile, the loudest objections are coming from elsewhere in Canada and the U.S. — particularly Michigan, which shares the Lake Huron shoreline with Ontario.
Critics are aghast at the idea. They don’t buy assurances that the waste would rest far beneath the lake’s greatest depths and be encased in rock formations that have been stable for 450 million years.
“Neither the U.S. nor Canada can afford the risk of polluting the Great Lakes with toxic nuclear waste,” U.S. Reps. Dan Kildee, Sander Levin, John Dingell and Gary Peters of Michigan said in a letter to a panel that is expected to make a recommendation next spring to Canada’s federal government, which has the final say.
Michigan’s two U.S. senators, Democrats Carl Levin and Debbie Stabenow, have asked the State Department to intervene. Business and environmental groups in Michigan and Ohio submitted letters. An online petition sponsored by a Canadian opposition group has collected nearly 42,000 signatures.
The decision on the $1 billion Canadian project could influence the broader debate over burying nuclear waste deep underground, said Per Peterson, a nuclear engineering professor at the University of California at Berkeley, who served on a national commission that studied the waste issue in the United States. The U.S. government’s plan for building a repository at Yucca Mountain in Nevada has been halted by stiff opposition.
“Demonstrating that this facility can be approved and operated safely is important because it can improve confidence that future high-level waste facilities also can be operated safely,” Peterson said.
The Canadian “deep geologic repository” would be the only deep-underground storage facility in North America, aside from a military installation in New Mexico. Other U.S. radioactive waste landfills are shallow — usually 30 metres deep or less.
The most highly radioactive waste generated at nuclear plants is spent fuel, which wouldn’t go into the Canadian chamber. Instead, the site would house “low-level” waste such as ashes from incinerated mop heads, paper towels and floor sweepings. It also would hold “intermediate waste” — discarded parts from the reactor core.
The project would be operated by Ontario Power Generation, a publicly owned company that manages waste generated by its nuclear reactors and others owned by Bruce Power, a private operator. Officials insist it’s the safest way to deal with radioactive material that has been stored aboveground since the late 1960s and needs a permanent resting place.
“We’ve had many scientists and engineers studying this for many years,” OPG spokesman Neal Kelly said. “They’ve concluded that it will not harm the environment or the public.”
Most of the waste would decay within 300 years, but the company acknowledges the intermediate waste would stay radioactive for more than 100,000 years. That’s too long for Eugene Bourgeois, who has a wool yarn business near Bruce Power.
“We have only recently discovered radioactivity,” he said. “It’s arrogant to think we’re smart enough to know what it will do to life on this planet over such a long time.”
Larry Kraemer, mayor of Kincardine, says most of his constituents don’t share those fears. The risk of radioactive pollution is “so low as to be almost unimaginable,” he said. “The people here draw their drinking water from the lake. We’re certainly not going to take any chances with it.”
Kincardine is among several small communities hugging the shoreline in southern Ontario’s Bruce County, which has miles of sandy beaches popular with tourists — particularly from Toronto, about three hours southwest. The downtowns are lined with shops, restaurants, parks, museums and woodsy footpaths.
The area’s first nuclear plant was built in the 1960s in countryside north of Kincardine. The sprawling Bruce Power site now has eight reactors and employs about 4,000 people. Kraemer says about half the jobs in his town of 12,000 are connected to the industry.
“We don’t have the knee-jerk reaction when someone says ‘nuclear’ that other people do,” said Joanne Robbins, general manager of the chamber of commerce in nearby Saugeen Shores. “We grew up with it.”
Beverly Fernandez, leader of the group that started the online petition, lives in Saugeen Shores but admits she’s focusing on rally opposition outside the area because the industry is so popular in Bruce County — which she dryly labels “the nuclear oasis.”
Company specialists say the waste would be placed in impermeable chambers drilled into sturdy limestone 680 metres below the surface, topped with a shale layer more than 180 metres thick. The lake’s maximum depth in the vicinity of the nuclear site is about 180 metres.
But Charles Rhodes, an engineer and physicist, contended seeping groundwater would fill the chamber in as little as a year, become contaminated and eventually reach the lake through tiny cracks in the rock.
“It’s only a question of how long, and how toxic it will be when it gets there,” he said in an interview.
Kraemer, the Kincardine mayor, said naysayers should be grateful his town is willing to shoulder a burden few others would accept.
“Opposition without responsibility is just a little too easy,” he said.
Ontario Power Generation: http://opgdgr.com/
Opposition group: http://www.stopthegreatlakesnucleardump.com/
10 more years in Afghanistan|Washington’s Blog | Business, Investing, Economy, Politics, World News, Energy, Environment, Science, Technology Washington’s Blog
When Barack Obama became president, there were 32,000 U.S. troops in Afghanistan. He escalated to over 100,000 troops, plus contractors. Now there are 47,000 troops these five years later. Measured in financial cost, or death and destruction, Afghanistan is more President Obama’s war than President Bush’s. Now the White House is trying to keep troops in Afghanistan until “2024 and beyond.”
Afghan President Hamid Karzai is refusing to sign the deal. Here is his list of concerns. He’d like the U.S. to stop killing civilians and stop kicking in people’s doors at night. He’d like the U.S. to engage in peace negotiations. He’d like innocent Afghan prisoners freed from Guantanamo. And he’d like the U.S. not to sabotage the April 2014 Afghan elections. Whatever we think of Karzai’s legacy — my own appraisal is unprintable — these are perfectly reasonable demands.
Iran and Pakistan oppose keeping nine major U.S. military bases in Afghanistan, some of them on the borders of their nations, until the end of time. U.S. officials threaten war on Iran with great regularity, the new agreement notwithstanding. U.S. missiles already hit Pakistan in a steady stream. These two nations’ concerns seem as reasonable as Karzai’s.
The U.S. public has been telling pollsters we want all U.S. troops out of Afghanistan “as soon as possible” for years and years. We’re spending $10 million per hour making ourselves less safe and more hated. The chief cause of death for U.S. troops in this mad operation is suicide.
When the U.S. troops left Iraq, it remained a living hell, as Libya is now too. But the disaster that Iraq is does not approach what it was during the occupation. Much less has Iraq grown dramatically worse post-occupation, as we were warned for years by those advocating continued warfare.
Humanitarian aid to Afghanistan — or to the entire world, for that matter, including our own country — would cost a fraction of what we spend on wars and war preparations, and would make us the most beloved nation on earth. I bet we’d favor that course if asked. We were asked on Syria, and we told pollsters we favored aid, not missiles.
We stopped the missiles. Congress members in both houses and parties said they heard from more people, more passionately, and more one-sidedly than ever before. But we didn’t stop the guns that we opposed even more than the missiles in polls. The CIA shipped the guns to the fighters without asking us or the Congress. And Syrians didn’t get the aid that we favored.
We aren’t asked about the drone strikes. We aren’t asked about most military operations. And we aren’t being asked about Afghanistan. Nor is Congress asserting its power to decide. This state of affairs suggests that we haven’t learned our lesson from the Syrian Missile Crisis. Fewer than one percent of us flooded Congress and the media with our voices, and we had a tremendous impact. The lesson we should learn is that we can do that again and again with each new war proposal.
What if two percent of us called, emailed, visited, protested, rallied, spoke-out, educated, and non-violently resisted 10 more years in Afghanistan? We’d have invented a new disease. They’d replace the Vietnam Syndrome with the Afghanistan Syndrome. Politicians would conclude that the U.S. public was just not going to stand for any more wars. Only reluctantly would they try to sneak the next one past us.
Or we could sit back and keep quiet while a Nobel Peace Prize winner drags a war he’s “ending” out for another decade, establishing that there’s very little in the way of warmaking outrages that we won’t allow them to roll right over us.
Occupation of government buildings continue as Thai court issues warrant for top protest leader.
Last updated: 26 Nov 2013 11:45
|Thai protesters have besieged several more government ministries in an escalating campaign to topple Prime Minister Yingluck Shinawatra’s government.
Demonstrators targeted the tourism, transport and agriculture ministries on Tuesday, one day after swarming the finance and foreign ministries in the biggest street protests since the country’s 2010 military crackdown. Officials left these government buildings.
Thailand’s PM appealed earlier on Tuesday for an end to “mob rule” as she prepared for a pivotal no-confidence vote in parliament. Protests have been fuelled by claims Yingluck Shinawatra’s government is controlled by her brother, former premier Thaksin Shinawatra.
Thaksin Shinawatra was ousted in a military coup in 2006 for alleged corruption.
“Everybody must obey the law and not use mob rule to upstage the rule of law,” Yingluck Shinawatra told reporters as she arrived at parliament early on Tuesday, reiterating a vow that authorities would “absolutely not use violence.”
Reporting from Bangkok, Al Jazeera‘s Florence Looi said that a Thai court approved an arrest warrant for Suthep Thaugsuban, one of the top protest leaders, on Tuesday in connection with the occupation of ministries.
Talking to Al Jazeera, Suthep Thaugsuban vowed to stay at the finance ministry, where he continued a sit-in protest with others, and said that he would address the protesters later in the day.
Looi also said that the police forces are planning to go to the occupied government buildings and try to persuade protesters to leave.
The police presence in Bangkok has grown in response to the expansion late Monday of the Internal Security Act (ISA), which gives authorities additional powers to block routes, impose a curfew, ban gatherings and carry out searches, although peaceful rallies are still allowed.
About 200 anti-government protesters camped out overnight at the finance ministry after Yingluck Shinawatra invoked the emergency law.
“We have told protesters that after the ISA was invoked across Bangkok, they are violating the law by trespassing in ministries,” said Paradorn Pattanatabut, chief of the National Security Council.
MPs are due to begin debating a no-confidence motion on Tuesday, which was put forward by the opposition last week as part of a barrage of legal and institutional challenges to Yingluck Shinawatra’s embattled government.
The recent protests were sparked by ruling party plans to introduce an amnesty that could have allowed the return from self-imposed exile of Thaksin Shinawatra, a deeply polarising figure who remains a populist hero among the poor.