As the new Russian state struggles with the transition to a market economy, the need for radical monetary reform becomes increasingly urgent. The choice of reform is crucial, for it will largely determine Russia's future economic performance.
Following the attacks on key crude oil production facilities in Saudi Arabia, President Donald Trump announced the authorization of the release of oil from the U.S. Strategic Petroleum Reserve (SPR) to keep the market well supplied. This move changes nothing in the way the SPR is governed. The market, not the President, should determine the release of the massive SPR. Government stockpiles are nothing new. The U.S. has had a long and fatal attraction to hoarding commodities for national emergencies. Indeed, the government has squirreled away everything from aluminum to zinc. But, the mother of all these commodity hoards is the SPR. Established in December 1975, it consists of five underground storage facilities hollowed out from salt domes in Texas and Louisiana. At present, they hold 645 million barrels of crude oil, over 1.5 times greater than the amount in private U.S. inventories. The massive SPR inventory would fully supply U.S. crude consumption for almost an entire month.
On September 14th, drones targeted Saudi Arabia's Abqaiq oil refinery and Khurais oil field. The strikes reportedly knocked out more than half of Saudi Arabia's total output. That amounts to a whopping 6-7% of the global daily oil supply. Not surprisingly, before the dust had settled, the press sounded an alarm and spread fear. Then, President Trump jumped in, claiming the attack “won't affect us and ultimately I don't think it will affect the world either.” Well, let’s take a look at the data.
Everyone seems to be wringing their hands about what they fear is an oncoming recession. Indeed, as a sign of the level of the public’s angst, The Economist magazine reports that Google searches related to the word “recession” have surged. If that wasn’t enough evidence of the hand wringing, the Chairman of President Trump’s Council of Economic Advisers, the respected Tomas Philipson, recently indicated that he was worried about the steady negative drumbeat in the press: that a recession might be just around the corner. Philipson put his finger on the problem when he said, “The way the media reports the weather won’t impact whether the sun shines tomorrow. But the way the media reports on our economy weighs on consumer sentiment, which feeds into consumer purchases and investments.”
The Gregorian calendar has been around since 1582. Even though it is widely used throughout the world, it contains flaws that give rise to confusion and financial miscalculations. The replacement of the Gregorian calendar with the Hanke-Henry Permanent Calendar(HHPC) will throw confusion and financial miscalculations into the dustbin. One set of problems thrown up by the Gregorian calendar is the so-called “day-count problem.” For example, to determine how much interest accrues on financial instruments— like bonds, mortgages, swaps, and forward-rate agreements—day counts, the number of days interest accrues, are required. With the Gregorian calendar, complexities and anomalies exist that create difficulties, which give rise to day-count problems.
Colombia’s peso is in trouble, again. Against the U.S. dollar, the peso has shed 20% of its value in a little more than a year and 7% in the last month. Like most Latin American currencies, the Colombian peso bobs up and down like a yo-yo, but its long-term trend is one of weakness. Indeed, since August 2014, the peso has lost 45% of its value against the greenback. Talk about a theft!