For Those Who Enjoy Discussing Climate Change..... Not Chess Related

[Paul Beckwith]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

It is not surprising that forestry and paper are in trouble; with print media being replaced by electronic media demand for paper has collapsed. I do not think that the carbon tax affected this much, although it could have been the final nail in the coffin.

Natural gas (basically methane) is a very interesting topic that we discussed yesterday in a different context. As, you say the market in North America has basically collapsed and my ETF GAS did not do so well (along with my BetaPro ETF HOU for oil since the price has been two volatile). Not only did the shale gas finds punish it, but also as oil wells deplete the well pressure drops and more natural gas bubbles out of the oil to the top of the reservoir, so ironically as oil depletes there becomes more natural gas in the short term (Jeff Rubin covers this in his interesting book "Why your world is about to get a whole lot smaller"). I spoke to Jeff at his book launch in Ottawa months ago, and he said that natural gas has huge regional price variations and is still very highly priced in Europe and elsewhere. If this disparity continues for a long time he feels that we may liquify it (Liquified Natural Gas LNG) and North America could become an exporter of it. This is opposite to what people thought a few years ago, when the view was that we would be importing LNG from other places. I think that Jeff knows his stuff, some say he is a maverick but he was chief economist at CIBC world markets for a long time.

B. C. is experiencing some of the problems with having a carbon tax in one place and not in other places. To be really effective it would need to be implemented in most other countries to level the playing field. Barring that, to counteract the downside I think that Rubin recommended import tariffs on countries that do not have carbon taxes or greener production to level the playing field.

I looked at the link and think that it would be a horrible mistake for any place to give corporations a vote in elections. They already have a big enough impact with their lobbying and large resources relative to the general public. I wonder how it worked years ago when it was allowed in B.C.?

[Gary Ruben]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

Paper is cyclical. I renewed my newspaper this morning for the next 3 months. I like something in print even though I do check out some of the online articles to keep current on other geographic areas. Once the economy and advertising picks up a bit so should newsprint sales. Maybe not to what they once were but most of it. There are also a lot of export sales. I think the television stations are also having problems with a drop in advertising from what I'm reading so it's not limited to the print media.

If you want to discuss ETF's on oil and gas I'll do it in the other thread. All I'll say here is I'm not invested in oil and gas ETF's or companies, except for one which has a relatively small amount of production. I have the company for its Thermal Coal and Nickel. With oil and gas, it's just too exciting. :)

I didn't do read the book and mostly do my own analysis and form my own opinions. Regarding LNG, I once had a long discussion with someone from Alberta on the old message board. The high price it would reach came up as did LNG. I told him then imported LNG would moderate the price.

From all the discussions we have had on the price of oil and natural gas on this message board over the years, the main message is that when the price of the product gets too high the demand will drop. I think we've seen this the past year and a half. We're also seeing the demand for Potash dropping because of the price. They say sooner or later the farmers will have to pay the price or have lower crop yields. Probably the farmers figure lower yields are better if they can get a profit from them, whereas it might not be profitable if the extra fertiizer cost eats up too much revenue. We'll see next year, I suppose.

On LNG, countries which ship to us would normally get nothing or next to it for their gas. If the get a couple of dollars per MCF it's better than nothing. Their labour costs might be very low and they might have hit it instead of oil.

In Canada, in some places, the cost of drilling is expensive. It might cost 5 dollars per MCF to break even. Then you have to liquify it and ship it to market. An extra cost. Breaking even isn't what companies look for when they explore for oil and gas.

Remember that Canada and the U.S. are not the only nations which have shale gas. I don't think it's that cheap to drill for the gas and frac the wells but don't know.

Regarding the import Tarrifs you mention, is it allowed in Free Trade agreements?

Sugar isn't an open market as far as I know. They have quotas.

Regarding giving companies a vote, they don't do it because they want to. They do it to keep companies which feel they are being badly over taxed by local government. It's how you keep business from leaving.

[Jason Lohner]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

Local Governments over tax because they have to... This started in the 90's with the Federal Liberals passing on the bill to the provincial governments. This was most noticeable in health care spending. The Provincial Governments did the exact same thing to the local municipalities... I remember the translink fiasco where the NDP off loaded that cost to the GVRD. These local governments just passed the increased taxes off to businesses because if they tried to raise property taxes they would have been voted out. Of course this meant that local businesses were forced to take measures to remain profitable. Here in BC quite a few businesses left for Alberta because of the NDP policies... I know that in Salmon Arm there was a company that made/designed wireless network cards... they were one of the largest employers in the area, and when the NDP were re-elected they closed shop and moved to Alberta. Many Businesses just added the cost to their prices (if at all possible) and then the consumers payed them... Thats one thing that has always made me shake my head... business don't pay taxes! they just pass the cost on and us consumers pay them... people don't seem to realize this.

Also here in Salmon Arm there are two large mills... One has shut down and the other is on a skeleton crew. The main reason for this has very little to do with the carbon tax. It has to do with the low demand from their #1 customers... the US.

From an 'average person's' viewpoint I haven't seen much of the doom and gloom that was predicted by the Carbon tax. The largest visible reaction is that people aren't buying as many gas guzzling SUV's Yes energy prices have increased but people are replacing these devices with energy efficient models that lower their total bills. I know I'm in the market for a new furnace and my #1 factor is energy efficiency... before the carbon tax I would have just looked for the cheapest model.

[Gary Ruben]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

I thought Alberta would not allow local government to charge more than 4 times the residential rate, or something around that number. That being one of the reasons they are able to attract business.

You're right about who pays the taxes charged to business. Problem is when they sell to other markets and are no longer competitive at the higher prices they close down or move. It's hard to get new loans or renew loans when the cash flow doesn't justify it.

Here's an interesting news release.

http://www.newswire.ca/en/releases/a.../07/c4845.html

[Vlad Drkulec]

Re: Truth Destroys Myths

Thanks for your post Benoit, you saved me the work of responding to Vlads latest ramble about the hockey stick. He seems to think that the entire framework for climate change research is based on one study of a few tree rings!

Nice straw man argument. That is not my position at all.

You brought up the hockey stick. The hockey stick has been discredited despite what certain websites which advocate a particular point of view have to say.

The more I read about it the more clear it becomes that a very small group of Mann interrelated researchers cherry pick the data that they want considered using the same data sets which they then weight to show the hockey stick. Even Mann said (when the heat got too high over his stonewalling about providing his data sets):

From Wikipedia:
In a letter to Nature on August 10, 2006, Bradley, Hughes and Mann pointed at the original title of their 1998 article: "Northern Hemisphere temperatures during the past millennium: inferences, uncertainties, and limitations"[50][51] and pointed out "more widespread high-resolution data are needed before more confident conclusions can be reached and that the uncertainties were the point of the article." Mann and his colleagues said that it was "hard to imagine how much more explicit" they could have been about the uncertainties surrounding their work and blaming "poor communication by others" for the "subsequent confusion."

"Indeed, as is discussed later, during the review process of the recent fourth
assessment report5 (AR4), the IPCC actually supported at least one author who had declined to release data. Authors of many of the key climate studies cited in the IPCC are brazen in their refusal to release data and methodology, as the governing principles seem rightly to require, and despite their leading roles in the IPCC process giving enhanced stature to their work. Repeatedly, the IPCC and its advocates strip the uncertainties from the science and present possibilities as strong probabilities or near certainties."
- BIAS AND CONCEALMENT IN THE IPCC PROCESS: THE “HOCKEY-STICK” AFFAIR AND ITS IMPLICATIONS by David Holland

Vladimir Drkulec

[Vlad Drkulec]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

If you are so underwhelmed by an ocean rise of 0.6 degrees C then why are you so overwhelmed by a global average rise of 0.8 degrees C over the last 100 years. You are obviously overwhelmed by this since you fight tooth and nail to show that it is not happening even though peer-reviewed papers by scientist around the world say it is happening.

I do not know whether it is happening or not. I do know that certain people are fudging the data and using statistics that they do not understand and apply incorrectly to reach erroneous conclusions.

I trust Wegman more than I do Mann. HTH.

Vladimir Drkulec

[Paul Beckwith]

Re: Truth Destroys Myths

Vlad, I am still confused. You say that the Mann hockey stick based on tree ring data has been discredited which I dispute...

Are you also claiming that all the hockey sticks based on data from independent methods like glacial retreat, borehole reconstructions, ice cores, and direct instrumental records and reported in papers that have all been peer reviewed are also discredited, even though they corroborate each other? The probability of that occuring is extremely low, with your vast statistical knowledge surely you can acknowlege that. Occam's razor (the simplest explanation is probably the correct one) would suggest that these plots are valid.

Please stop bringing up Mann for a moment and discuss these other data sets...

[Paul Beckwith]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

Vlad, I am wondering what you think of the pH data? Clearly that is another hockey stick type pattern, with no change for a large time period (650,000 years) and then a sudden drop over the last century. Actually it is an inverted hockey stick. Do you also discount this data, even though we are talking about pH and not temperature. How do you explain this drop, or do you just discount it.

Try calculating it yourself. Knowing the radius of the earth, calculate the surface area,
take the percentage covered by water (70.8%), estimate that the pH change has occurred in the top 100 m or so of surface water and estimate the amount of CO2 that has been absorbed by the water to change the pH and see if it matches about 50% of worldwide emissions...

How is your statistics. We can dig up some of the datasets that are publicly available and do some calculations ourself? Is your background in statistics or science. Bob Gillanders mentioned that he thought you were in computers?

[Benoit St-Pierre]

On Staying Agnostic

The hockey stick has been discredited despite what certain websites which advocate a particular point of view have to say.

This bad ad homimem is not a proper way to stay agnostic.

[Benoit St-Pierre]

In One Sentence

The hockey stick has been discredited despite what certain websites which advocate a particular point of view have to say.

The more I read about it the more clear it becomes that a very small group of Mann interrelated researchers cherry pick the data that they want considered using the same data sets which they then weight to show the hockey stick. Even Mann said (when the heat got too high over his stonewalling about providing his data sets):

Zooming in, that is supposed to reply to :

The second falsehood holds that there are errors in the Mann et al (1998, 1999) analyses, and that these putative errors compromise the “hockey stick” shape of hemispheric surface temperature reconstructions. Such claims seem to be based in part on the misunderstanding or misrepresentation by some individuals of a corrigendum that was published by Mann and colleagues in Nature. This corrigendum simply corrected the descriptions of supplementary information that accompanied the Mann et al article detailing precisely what data were used. As clearly stated in the corrigendum, these corrections have no influence at all on the actual analysis or any of the results shown in Mann et al (1998). Claims that the corrigendum reflects any errors at all in the Mann et al (1998) reconstruction are entirely false.

So the reply does not take a bite at the follow-up on the litterature. It just reasserts what is being called into question, followed by a blatant attack on the researchers themselves. The overall conclusion is sweeped under this reference :

http://klimarealistene.com/Holland(2007).pdf

In its conclusion, there is one sentence that would make any epistemologist smile :

The alarming model projections depend upon many unproven assumptions and are only consistent with the assumption that current warming is exceptional compared with the past when greenhouse gas concentrations were lower.

This sentence alone raises a number of issues. First, there is the "alarming" word, which is certainly not showing an objective point of view. Second, I wonder where one can find a "proven assumption". Third, and quite astoundingly, the assumption about current warming is no assumption at all : it is what the researchers are trying to find out. While his political analysis of the situation is interesting, his epistemological point cuts no ice at all.

Besides, David Holland is an independant researcher :

http://www.world-economics-journal.c...s.aspx?AID=421

It would interesting to find something more tangible to be able to assert that we're talking about the conclusions of a "very small group of Mann interrelated researchers".

[Paul Beckwith]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

Sea ice coverage in the Arctic ended up having its third lowest year, after 2007 and 2008.





First year ice (thin, more vulnerable to melt) accounted for 49 percent of the ice cover at the end of summer, second-year ice made up 32 percent and 19 percent of the ice cover was over 2 years old (lowest in the satellite record and far below the 1981-2000 average of 52 percent). Satellite data has shown that ice thickness declined by 0.68 meters (2.2 feet) between 2004 and 2008.

[Gary Ruben]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

Natural gas (basically methane) is a very interesting topic that we discussed yesterday in a different context. As, you say the market in North America has basically collapsed and my ETF GAS did not do so well (along with my BetaPro ETF HOU for oil since the price has been two volatile). Not only did the shale gas finds punish it, but also as oil wells deplete the well pressure drops and more natural gas bubbles out of the oil to the top of the reservoir, so ironically as oil depletes there becomes more natural gas in the short term (Jeff Rubin covers this in his interesting book "Why your world is about to get a whole lot smaller"). I spoke to Jeff at his book launch in Ottawa months ago, and he said that natural gas has huge regional price variations and is still very highly priced in Europe and elsewhere. If this disparity continues for a long time he feels that we may liquify it (Liquified Natural Gas LNG) and North America could become an exporter of it. This is opposite to what people thought a few years ago, when the view was that we would be importing LNG from other places. I think that Jeff knows his stuff, some say he is a maverick but he was chief economist at CIBC world markets for a long time.

You left me curious about something. Being concerned about the environment, why would you invest in oil and gas? They buy futures contracts, as far as I know, and it helps push the price up to make drilling for more reserves attractive.

When oil was over 140 and a certain analyst was predicting 200 or more, it prompted me to short it with an etf. I did quite well on that.

I'm concerned about things like overfishing the oceans. My idea of an investment in that area is the satellite company which develops and launches satellites which can be tasked to catch those which are doing illegal fishing. I think I posted a news link on that from the company yesterday. If I lose on it, there will still be the satisfaction of having possibly made a difference to the fish population.

Ruben loves fish... particularly in chess. :)

[Paul Beckwith]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

If I restricted myself from investing in oil and gas then I would be cutting myself out of a huge chunk of the Canadian market. I am not really an environmentalist, more a person scientifically studying a particular aspect of the environment, namely climate change. If the data showed the planet cooling instead of warming, then that is the position that I would defend. What does annoy me is when people try to mislead the public with their views that are backed by "junk" science.

[Gary Ruben]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

If I restricted myself from investing in oil and gas then I would be cutting myself out of a huge chunk of the Canadian market. I am not really an environmentalist, more a person scientifically studying a particular aspect of the environment, namely climate change. If the data showed the planet cooling instead of warming, then that is the position that I would defend. What does annoy me is when people try to mislead the public with their views that are backed by "junk" science.

Natural gas is easy as far as I can see. It's used pretty much for heating and also for industrial and commercial. Used to be roughly around 50 - 50 in this area. I don't know what it is these days.

Now if you see industry slowing down and closing down, PLUS expect global warming and a moderation of temperatures in Canada and the U.S, where would you expect the demand, which should drive up prices, to come from?

Maybe the slowdown in industry the past year or two has contributed to some cooling over that period to time. Do you think that's possible? Could this be a variable which isn't built into the models?

[Paul Beckwith]

Re: For Those Who Enjoy Discussing Climate Change..... Not Chess Related

Natural gas power plants are good "peaking" plants. They can be started up and shut down extremely quickly when the electricity demand changes rapidly. Carbon emissions from these plants are about 50% that of coal burning plants, so they would become very useful in conjuction with renewables that have varied supply, like wind and solar. Also, as I mentioned in a previous post, the natural gas market is very regional, unlike oil because the gas cannot easily be shipped around the world. If the price in North America was discounted greatly for a long period of time relative to prices in other parts of the world like Europe (for example), then companies would start converting it to LNG (liquified natural gas) and export it from North America to these places.

The slowdown in industry over the last several years has definitely reduced global emissions, i.e. oil demand has dropped from about 86 million barrels per day down to about 84 million barrels per day (a few percent). Carbon dioxide levels in the atmosphere are at the following level:

Sept 2009 384.78 ppm
Sept 2008 383.07 ppm
Sept 2007 380.81 ppm

The rise from 2008 to 2009 was 1.71 ppm, a slowing down of the rise from 2007 to 2008 which was 2.26 ppm. This could be due to the recession but it is probably too early to tell. I will address the cooling question in other posts.