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Commodities Briefing - Archive | June, 2009

Opalesque Exclusive: Carbon and emissions trading in Europe, Part Two - Some foresee a perfect storm and carbon challenges for the energy sector, Climate change revisited

Posted on 30 June 2009 by VRS  |  Email |Print

Benedicte Gravrand, Opalesque London: Following yesterday’s Part One - How the Europeans do it: Source.

Two of the financial groups that bet on climate change are in focus today; one foresees a price hike in emissions allowances in the near future, the other bets on oil and gas firms that are prepared for the forthcoming low-carbon economy.

Akur Partners sees the silver lining in an approaching perfect storm Tom Frost, who has a PhD in Climate Change and who is a founding partner at Akur Parners, a new finance and equity capital markets advisory firm based in London, wrote an interesting presentation on the carbon markets in Europe, forecasting a ‘perfect storm’ (an analogy for an event where a combination of circumstances will aggravate a situation drastically.)

The EU Emissions Trading Scheme (ETS) is the world’s most advanced and far reaching market designed to tackle climate change, he notes. It is intended to give industry (which must participate) flexibility and control to choose how to meet emissions reductions targets, whether through investment or the trading of emissions allowances. Currently worth over Eur20bn, it is lightly regulated and in its infancy.

During ETS’ Phase I (2005-07), the EU over-supplied emissions allowance - bringing prices down to zero. In the current Phase II (2008-12), it is under-supplying it. Frost believes that a significant supply squeeze could impact the EU market before the end of the current phase. As distressed buyers of emissions allowances come to the market simultaneously, prices may spike to high levels - and this could be a golden opportunity for financial investors.

Akur’s quant model forecasts EUA price of Eur64 by 2012 - from Eur10 Akur Partners’ new EU emissions Allowance (EUA) pricing model seeks to find the fundamental price point for an emissions allowance traded on the EU ETS. It attempts to take into account feedback mechanisms likely to impact the supply of carbon credits to the scheme, and the impact of banking and borrowing allowances.

Akur’s base case scenario sees a potential EUA price of Eur64 ($90) toward the end of the current phase of the scheme (including weak speculator activity), versus the current market price of c.Eur10. An upside case examines the potential impact of strong speculator activity and sees the potential for the Eur100/EUA price ceiling to be tested.

An explanation of AKUR’s ‘perfect storm’ is in the firm’s recent presentation ‘The carbon markets - Europe’s perfect storm is brewing‘ which can be found here: Source.

Climate change - revisited The greenhouse effect is the mechanism by which the planet’s surface temperature is kept warm and regulated by the atmosphere. Gases in the atmosphere act as panes of glass, insulating the planet. Man-made emissions have amplified this natural effect - resulting in global warming, the general average warming of the planet - as a result of which, climate change occurs. Examples of climate change include increased rainfall, extreme weather events, drought, higher temperatures (and lower temperature in some places as ocean circulatory patterns change).

According to charts Tom Frost gave out in a presentation in London last month, levels of Carbon Dioxide (CO2), Methane (CH4) and Nitrous Oxide (N2O), as well as temperature, have all risen significantly since the 1800s, when the industrial revolution started - compared to the previous 800 years during which levels were steady.

These three major greenhouse gases make up for less than 0.04% of the total volume of the atmosphere - but the majority of the warming impact on the planet is from these three gases. Frost adds t………………….

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Commodity bulls may need breather in second half

Posted on 30 June 2009 by VRS  |  Email |Print

From Guardian: The commodities rally in the first half may meet resistance in the third quarter because the dollar may not weaken enough to inflate prices of raw materials as it did in recent months, analysts said on Monday.
One session before the close of first-half trading, the Reuters-Jefferies CRB index, a global commodities benchmark, looked poised to end the second quarter with a 15-percent gain for its first quarterly advance in a year……..Full Article: Source

Commodity rally may falter on supply, speculators

Posted on 30 June 2009 by VRS  |  Email |Print

From Bloomberg: Commodities, heading for the first quarterly advance in a year, may struggle to repeat their gains in the next three months as supply expands and speculators sell.

Nickel may average 29 percent less in the third quarter than now, crude oil 16 percent, copper 14 percent and gasoline 10 percent, analyst estimates compiled by Bloomberg show……..Full Article: Source

Mobius sees value in commodities

Posted on 30 June 2009 by VRS  |  Email |Print

From Guardian: Emerging markets offer more upside than the developed world, with commodities and consumer-oriented stocks the top picks, Templeton Asset Management’s veteran fund manager Mark Mobius said on Monday.
Positive prospects for commodities favour the Russian market and stocks, while a large domestic market driving consumer-oriented stocks marked Poland as best pick in central and eastern Europe, he said……..Full Article: Source

Commodities have likely hit bottom

Posted on 30 June 2009 by VRS  |  Email |Print

From China’s appetite for foreign oil has surpassed that of the United States, according to the Bank of Nova Scotia, as consumers race to the pumps to fill their new cars and the country feverishly builds storage facilities to take advantage of weak markets.

In its monthly commodity update, market specialist Patricia Mohr said China relied on imports for 57 percent of its petroleum production, while the United States imported 55 percent of its needs……..Full Article: Source

China will drive commodities super-cycle: Scotiabank

Posted on 30 June 2009 by VRS  |  Email |Print

From Canada’s key commodities have reversed their dramatic declines and are headed for years of renewed strength as the Chinese “dragon” rekindles an Asian-led super-cycle in basic materials, says Scotiabank commodities expert Patricia Mohr.

Driven by record levels of imports into China, Scotiabank’s commodity-price index climbed 2.2% in May from April, the month in which the 45% slide from July 2008 peaks came to an end, according to Ms. Mohr……..Full Article: Source

China signals end of stockpiling

Posted on 30 June 2009 by VRS  |  Email |Print

From A record-breaking run of commodities exports to China that has sustained the Australian economy may be set to end, with Beijing officials and advisers announcing an end to “strategic” stockpiling, and massive iron ore contracts likely to expire today.

A key state planning official has signalled a halt to government buying of copper, aluminium and other high-value metals because prices have risen too high……..Full Article: Source

Congress eyes market impact of speculators: Vilsack

Posted on 30 June 2009 by VRS  |  Email |Print

From Congress is eyeing ways to make sure speculative trading helps commodity markets rather than distorting pricing signals, U.S. Agriculture Secretary Tom Vilsack said in a Reuters Television interview Monday.

“There are concerns,” Vilsack said, noting he has spoken about the issue with Tom Harkin, chairman of the Senate Agriculture Committee……..Full Article: Source

What The Fox and The Hedgehog tell us about commodities

Posted on 30 June 2009 by VRS  |  Email |Print

From Trying to analyse current conditions in various financial markets isn’t easy, and commodities markets are no exception.
The online and offline financial press is full of comments from gurus and experts with all manner of prognostications about the likely evolution of events……..Full Article: Source

Global recovery coming soon, Barclays’ Bond says

Posted on 30 June 2009 by VRS  |  Email |Print

From Bloomberg: Investors displaying “a bout of impatience” for a worldwide economic recovery may soon find relief, according to Tim Bond, head of global asset allocation at Barclays Capital.

“The hard evidence of recovery that the markets seem to require will be available in August and September,” Bond wrote in a June 26 report. His estimate is based on data for business cycles since World War II……..Full Article: Source

Commodities roundup: Crude oil

Posted on 30 June 2009 by VRS  |  Email |Print

From The bulls are at it again this summer. However, unlike 2008 when a falling dollar and insatiable demand lifted crude oil prices to all time highs, this year’s rally is missing one critical component - consumption.

While the media has been busy playing up summer gas prices and green shoots, energy bulls may want to peek under the covers and realize that we’re still in a recession. Demand is off……..Full Article: Source

IEA cuts oil demand forecast

Posted on 30 June 2009 by VRS  |  Email |Print

From The International Energy Agency yesterday cut sharply its medium-term forecast for oil demand because of economic recession, but said the threat of a supply crunch had only receded, not gone away.

The adviser to 28 developed countries said in a report demand will expand by 0.6 percent, or 540,000 barrels per day (bpd) on average, between 2008 and 2014……..Full Article: Source

Iraq likely to miss output targets, says IEA

Posted on 30 June 2009 by VRS  |  Email |Print

From Independent: Iraqi government plans to boost the country’s oil output may prove over-optimistic, the International Energy Agency said yesterday.

The warning came as Baghdad put back its first auction of production licences by another day……..Full Article: Source

No need for Opec to boost output

Posted on 30 June 2009 by VRS  |  Email |Print

From Qatar Deputy Premier and Minister of Energy and Industry Abdullah bin Hamad al-Attiyah said yesterday he did not see any need for Opec to increase output when it next meets in September.

“I don’t think so,” al-Attiyah told reporters when asked about the September 9 meeting of the Organisation of the Petroleum Exporting Countries……..Full Article: Source

Iraq to open up oil fields to foreign firms

Posted on 30 June 2009 by VRS  |  Email |Print

From Iraq is to unveil the foreign firms which have won contracts to develop key oil and gas fields, nearly four decades after Saddam Hussein’s party nationalised the country’s energy sector.

The deals, likely to be announced live on television on Tuesday or Wednesday, will provide the government with much-needed revenue as it struggles to rebuild the country after three wars and more than a decade of debilitating economic sanctions……..Full Article: Source

Abu Dhabi houses renewables body

Posted on 30 June 2009 by VRS  |  Email |Print

From BBC: The International Renewable Energy Agency (Irena) will have its headquarters in Abu Dhabi.

The decision was taken at the inaugural meeting of the body which was created in January and will advise governments about renewable energy and technology……..Full Article: Source

Factfile: nuclear and carbon trading

Posted on 30 June 2009 by VRS  |  Email |Print

From The UK boss of EDF, EDF Energy CEO Vincent de Rivaz has called for a ‘level playing field’ for nuclear power, and suggested that the UK government establish a floor on the price of carbon in the publicly-traded European Emission Trading Scheme (ETS).
Nuclear power stations generate hardly any carbon dioxide - yet carbon trading plays a big role in the industry. …….Full Article: Source

US won’t use tariffs to change climate

Posted on 30 June 2009 by VRS  |  Email |Print

From Barack Obama has warned against the US imposing trade penalties on countries that decline to limit carbon emissions, after a late amendment was added to climate change legislation approved by the House of Representatives.

The US President said yesterday that the energy Bill passed on Saturday, which limits emissions under a cap-and-trade system, was an “unprecedented first step” in combating climate change……..Full Article: Source

Wall Street eagerly waiting for carbon credit trading

Posted on 30 June 2009 by VRS  |  Email |Print

From The opposition by the Republicans to the idea of carbon trading is a bit baffling, given that it is a classic Wall Street-driven solution for dealing with a serious problem.

Sure, carbon trading, which is the centerpiece of the Obama administration-backed American Clean Energy and Security Act, would carry a cost for consumers and companies that emit too much in greenhouse gases……..Full Article: Source

Nonferrous metals price forecasts revised

Posted on 30 June 2009 by VRS  |  Email |Print

From Several market analysts are now forced to eat their words nonferrous metals and revising their forecasts for 2009.

Several nonferrous metals analysts have already revised their predictions for spot nonferrous prices on the London Metals Exchange (LME)……..Full Article: Source

Japan to boost minor metal stockpile as prices dip

Posted on 30 June 2009 by VRS  |  Email |Print

From Guardian: Japan aims to take advantage of a price decline to roughly double its national stockpile of minor metals, but it does not expect its purchases to be a factor in driving up prices in the long term given current slow demand and high stocks.
The move is part of a broad review of the nation’s stockpile, set up in 1983, which will add two new metals — indium and gallium — to the seven currently held……..Full Article: Source

Major steel mills back in black

Posted on 30 June 2009 by VRS  |  Email |Print

From China’s major steel mills turned profitable in May for the first time since last October due to weeks of surging steel prices and low iron ore prices.

Around 72 large and medium-sized steel mills in the country made a combined profit of 1.26 billion yuan ($184.44 million) in May, said Chi Jingdong, an official with the China Iron and Steel Association (CISA)……..Full Article: Source

Gold investment at 707 tons per year during 2001-08

Posted on 30 June 2009 by VRS  |  Email |Print

From It seems global metals consultant GFMS is not ready to read the writing on the wall. In a latest report, GFMS said gold prices are likely to touch new highs in the second half of 2009, still sticking to its earlier prediction that gold may again cross $1000 per ounce levels.

However, gold doesn’t show that a trend now, which GFMS refusing to believe……..Full Article: Source

Gold drops for first time in five days as dollar stems decline

Posted on 30 June 2009 by VRS  |  Email |Print

From Bloomberg: Gold fell for the first day in five in Asia as a pause in the dollar’s decline damped demand for the precious metal as a haven investment.

Bullion, which typically moves inversely to the U.S. currency, has dropped 4.3 percent this month as the Dollar Index, a measure of the greenback’s value against six major trading partners, climbed 1.1 percent……..Full Article: Source

Last chance saloon for gold investors to jump in?

Posted on 30 June 2009 by VRS  |  Email |Print

From Some analysts see the regular annual hiatus in investment in gold during the northern summer season, which is now upon us, coupled with what they see as unwarranted strength in the U.S. Dollar, as providing the last major chance for gold investors to buy at ‘reasonable’ prices before a big surge in the gold price later in the year.
Buy on weakness is the cry - again!…….Full Article: Source

The gold market’s tech clues

Posted on 30 June 2009 by VRS  |  Email |Print

From The age-old contrast between fundamental and technical analysis was highlighted last week when a reader of a Hard Assets Investor interview commented, “I love how commodities investors are focusing on the fundamentals, while people who are currently overweight equities can’t shut up about the technicals.”

Fundamental analysis uses economic, political and environmental data to forecast future price movements, while technically derived predictions rely upon price patterns and changes in market volume. Commodity traders often use “the technicals” as well as fundamentals when making market decisions……..Full Article: Source

Why silver is back in demand

Posted on 30 June 2009 by VRS  |  Email |Print

From After the fall, the rise. That is the new silver lining for the white metal. Silver has again found favour with investors following its recent rise after the fall it witnessed since mid-2008.

Main reason for its gain is the rise in industrial demand and investors’ new found love for the white metal……..Full Article: Source

5 things to look for in your ETFs before buying

Posted on 30 June 2009 by VRS  |  Email |Print

From For every up, there is a down. Newton’s Third Law is true both in life and with exchange traded funds (ETFs). Not all ETFs are right for all investors, though. How do you decipher which ones are best for you?

Different ETFs serve different purposes. It depends on your risk tolerance, time horizon, investing style and the overall makeup of your portfolio……..Full Article: Source

ETF face-off in India

Posted on 30 June 2009 by VRS  |  Email |Print

From Both Powershares India Portfolio and Wisdom Tree Earnings Fund offer investors access to India with ETF products that track this growing equity market.
As investors regain confidence and begin to look abroad for opportunities to diversify their portfolios, both EPI and PIN have offered profitable returns in 2009……..Full Article: Source

Belgium ETF may shrink, but by how much is up in the air

Posted on 30 June 2009 by VRS  |  Email |Print

From Governments in the European Union have used up any room they had left to lower their interest rates, as European bonds have been oversold, taking related exchange traded funds (ETFs) for a ride.

Meanwhile, forecasts for Belgium’s economy are claiming a 4% decline this year, according to the Organization for Economic Cooperation and Development……..Full Article: Source

Dollar rises as China says currency may dominate global trade

Posted on 30 June 2009 by VRS  |  Email |Print

From Bloomberg: The dollar rose after China said the U.S. currency may keep dominating global trade and ruled out any “sudden” changes to its foreign-exchange reserves.

The dollar gained versus the Australian dollar, yen and Swiss franc after Guan Tao, deputy head of the international payment department at the State Administration of Foreign Exchange, wrote in Chinamoney Magazine that the greenback may maintain its status as the world’s reserve currency……..Full Article: Source

China continues to push for global currency overhaul

Posted on 30 June 2009 by VRS  |  Email |Print

From The People’s Bank of China (BOC) reiterated its call for a new global currency to replace the dollar Friday, highlighting Beijing’s growing discomfort with the dollar, as well as its determination to win a greater role for its currency, the yuan.

“To avoid the inherent deficiencies of using sovereign currencies for reserves, there’s a need to create an international reserve currency that’s delinked from sovereign nations,” said in its 2008 review, released Friday……..Full Article: Source

CIS countries switch to mutual settles in national currencies

Posted on 30 June 2009 by VRS  |  Email |Print

From The Commonwealth of Independent States’ banks have launched building up a payment union in national currencies.

IBA-Moscow Ltd (a subsidiary of the International Bank of Azerbaijan) has reported of holding of CIS International Bank Conference “Increasing the Role of National Currencies in CIS Export/Import Operations……..Full Article: Source

Commexes’ turnover soars 44%

Posted on 30 June 2009 by VRS  |  Email |Print

From The total turnover of commodity exchanges in the country surged by 44 per cent during the current fiscal till June 15, thanks to improved participation in agricultural commodities.
Increasing business is a sign of revived confidence in agricultural commodities, which had suffered a setback owing to ban on few items last year, experts said……..Full Article: Source

Ethiopia: ECX to update communication technology

Posted on 30 June 2009 by VRS  |  Email |Print

From The Ethiopian Commodity Exchange (ECX) has awarded the project for the development of software to introduce the Short Message System (SMS) and an Interactive Voice Response (IVR) to Apposite LLC, a local branch of a US based IT company, EXC officials disclosed.
The project is financed by the World Bank which has dedicated about seven million dollars to set up the ECX while supporting and modernizing its operations according to Achim Fock, senior economist at WB Ethiopia Office and task manager of the Bank’s Rural Capacity Building Project……..Full Article: Source

Crude and gold likely to climb

Posted on 30 June 2009 by VRS  |  Email |Print

From Both crude oil and gold are expected to appreciate in the coming weeks as the dollar’s depreciation continues, analysts say.

Following the uptrend is silver which normally does not attract as much attention as gold……..Full Article: Source

Opalesque Exclusive: Carbon and emissions trading in Europe, Part One - How the Europeans do it

Posted on 29 June 2009 by VRS  |  Email |Print

Benedicte Gravrand, Opalesque London:As public awareness of climate change issues is growing and market-based solutions are increasingly seen as the key to delivering pragmatic change, the trading business is booming.

The London-based European Climate Exchange (ECX) is seeing increased interest in emissions trading from the investment management and hedge fund community. Indeed, volumes on ECX are experiencing tremendous growth.

ECX, a marketplace for trading carbon dioxide (CO2) emissions in Europe and internationally, currently trades two types of carbon credits: European Union emissions allowances (EUAs), which are created and allocated; and Kyoto Certified Emission Reductions (CERs - aka ‘carbon credits’), which are earned from actual emissions reduction projects and which are issued by the UN.

Trading on ECX began in April 2005 with EUAs, and futures and options on CERs were introduced in 2008.

Capping and trading in pollutants Emissions trading, also known as cap-and-trade, is used to control pollution by providing economic incentives for achieving reductions in the emissions of pollutants, whereas a central authority sets a limit, or ‘cap,’ on the amount of a pollutant that can be emitted and issues emission permits to companies. Companies that need to increase their emission allowance must buy credits from those which pollute less. The transfer of allowances is referred to as a ‘trade.’

According to ECX’s CEO, Patrick Birley, talking from his offices in the City of London at a presentation last month, cap-and-trade is a system accepted as a mechanism to be used under the Kyoto Protocol - a 1997 international treaty which came into force in 2005 and which binds most developed nations to a cap and trade system for the six major greenhouse gases - and it is not well understood.

“It’s the ‘cap’ that’s the clever bit: it drives reduction in amount of emission, and it is incredibly complex to put in place,” he said. ECX is involved in the trade-side of the business. The emissions business introduces a way to limit emissions being pumped into the atmosphere, he explains.

The ‘cap‘ process consists of: 1. Measuring - thus creating a shortage in something that was always deemed to be limitless. That requires great political leadership as those covered will naturally resist (depending on local factors); 2. Licensing - like a license to pollute. These allowances will be slowly reduced over time, and industries will just have to adapt. 3. Limiting supply - which will never be truly fair.

Those that do well will end up with extra carbon permits they will be able to sell. Those that continue polluting at old levels will have to pay, and the charges will increase as the supply is squeezed. The overall improvement is the quantum of the reduced supply, Birley explains.

The ‘trade‘ part of the business brings buyers and sellers together, creating a price formatting mechanism. It provides transparency and liquidity, allows active financial risk management, and facilitates the monetisation of excess credits. It can be done on ECX, which is, in this respect, like any other exchange.

“Cap and trade is a U.S. invention,” explains Birley. “It came together with acid rain (sulphur) in the early 1990s. We don’t hear about acid rain anymore, which means major changes happened through the introduction of cap and trade.”

EU Emissions Trading Scheme The 27 Europeans member states put in a trial system between 2005 and 2007 - namely, Phase I of the EU Emissions Trading Scheme (ETS). It was an experimental phase but “phenomenally successful,” as emissions were reduced by an average of 8%, but it pointed at two major flaws: 1) too many permits were allowed and prices thereby declined; 2) permits with ends-date, if there is an over-supply, become worthless.

Phase II of the European experimentation takes place between 2008 and 2012 during the Kyoto Protocol’s given period (each participating country agreed at the Protocol to reduce overall emissions (cap) by 5.2% of their 1990 levels by the end of 2012.)

According to Birley, the European Union, which has since Phase I reduced its emissions allowance, has already been sued several times by some member states for under-allocation but has won each suit.

12% of allowances can come from the Clean Development Mechanism (CDM), the Kyoto mechanism which allows the creation of carbon credits. “95% of what is in the atmosphere now has been pumped by us in the last 200 years,” he explains. “We must empty it now before China and India start pumping it too. Thus in projects for carbon reduction in the developing world, participants gain credits too.”

Phase III sees the scheme finalising between 2013 and 2020. The European commitment is clear but there are no exact details of target and CDM quota.

“If only Europe participates,” Birley notes, “it will commit to a 20% cut by 2020. If the rest of the world participates, then total reduction could reach 30%.”

Climate exchanges The London-listed Climate Exchange Plc (CLE) heads the Chicago Climate Exchange (CCX), North America’s only cap and trade system for all six greenhouse gases launched in 2003 (see …………………………To view our full article: Click here

Emerging markets offer hope

Posted on 29 June 2009 by VRS  |  Email |Print

From It’s becoming one of the more hotly debated questions among those seeking a way out of the global recession: Is the world economy powered by one engine or two?

The speed at which the financial meltdown in the United States pulled the rest of the globe into a death spiral suggests the answer is clear. But the surprising resurgence of China, India, Brazil and other emerging markets is giving new life to a theory that the crisis appeared to make fanciful……..Full Article: Source

Weak dollar helps boost commodities

Posted on 29 June 2009 by VRS  |  Email |Print

From Gold touched a two-week high and marked its first weekly gain since May last week as the dollar weakened and a benchmark lending rate touched a record low in London, increasing the metal’s appeal as an alternative investment.

The dollar declined as the three-month London interbank offered rate, or Libor, slipped below 0.6 per cent for the first time……..Full Article: Source

Commodities at the mercy of greenback

Posted on 29 June 2009 by VRS  |  Email |Print

From Commodities managed to recover after an early onslaught of profit taking with gold heading for its first weekly gain since May.
The ongoing battle between the bulls and the bears continued last week in crude oil with the bears seemingly winning the upper hand early on as August crude dropped heavily below $70 (Dh257) only to recover late in the week……..Full Article: Source

Commodities markets won’t shine this year

Posted on 29 June 2009 by VRS  |  Email |Print

From Lower coal and iron ore prices are set to substantially erode Australia’s export earnings in 2009/10 but should be offset partially by strength in the gold price.

Underpinning commodities forecasts is belief in China’s economic resilience, tempered by strong evidence the rest of the world will not bounce back in a hurry from the largest economic slowdown since World War II……..Full Article: Source

Rare metals could trigger next trade war

Posted on 29 June 2009 by VRS  |  Email |Print

From Used in electric car motors and wind turbines, neodymium, a “rare earth metal,” is at the epicenter of the race between wealthy and emerging nations to create green technologies, while poorer countries appear to be relegated to spectator status.

Neodymium is a lanthanoid, at position 60 on the periodic table of elements for the number of atoms in a single molecule. Its production and wide range of uses reflect the quiet competition over raw materials in the area of green technologies……..Full Article: Source

Asia facing inflation threat next year

Posted on 29 June 2009 by VRS  |  Email |Print

From Inflation is creeping back as a threat for Asian economies despite a benign outlook for the next 12 months as weak consumer demand and excess capacity work to offset rising commodity prices, a Reuters poll showed on Friday.

Asked whether inflation or deflation posed the bigger risk for the region, economists said with the exception of Japan Asian nations should not be too worried about either over the next six to 12 months. …….Full Article: Source

Australian hedges outperform rising market

Posted on 29 June 2009 by VRS  |  Email |Print

From Australian-based absolute return and hedge funds are continuing to outperform despite the rising market, which usually causes returns to drop back due to their short positions.

A review of the hedge fund sector by Australian Fund Monitors shows that the funds delivered an average of 2.69 per cent in May, beating the benchmark S&P/ASX 200 index by 1.70 per cent……..Full Article: Source

China’s growth in doubt with lenders on a bender

Posted on 29 June 2009 by VRS  |  Email |Print

From The strength of China’s economy is seen by the the Reserve Bank and international institutions as the biggest source of hope for the Australian economy, but its growth may be less secure than they think.

The OECD raised its forecast for China’s growth from 6.3 to 7.7 per cent in its economic outlook last week, while the World Bank lifted its forecast from 6.5 to 7.2 per cent……..Full Article: Source

India: Commodity to the rescue

Posted on 29 June 2009 by VRS  |  Email |Print

From It could be one of those years when exposure in commodity futures, along with equities could be a good investment strategy.
One key factor in the turnaround of 1991-96 was five decent monsoons in a row. Since then, the rainfall pattern has been more hit-and-miss……..Full Article: Source

A funding roadblock ahead for clean energy

Posted on 29 June 2009 by VRS  |  Email |Print

From A landmark climate bill that narrowly passed the U.S. House of Representatives on Friday would cap greenhouse gas emissions across the United States for the first time and also create a national target for renewable energy production.
Environmentalists and advocates of clean energy hailed the news in a flurry of statements……..Full Article: Source

Climate bill shaped by compromise

Posted on 29 June 2009 by VRS  |  Email |Print

From Facing a mood unfriendly to sweeping changes in energy policy, House Democratic leaders and Obama had one thing that made interest groups more receptive: They were willing to negotiate.
So far, most of the major environmental groups are sticking with Obama. Most groups calculated that, in sum, the bill was worth moving, said Emily Figdor, the federal global warming policy director for Environment America……..Full Article: Source

BP shuts alternative energy HQ

Posted on 29 June 2009 by VRS  |  Email |Print

From Guardian: BP has shut down its alternative energy headquarters in London, accepted the resignation of its clean energy boss and imposed budget cuts in moves likely to be seen by environmental critics as further signs of the oil group moving “back to petroleum”.

But Tony Hayward, the group’s chief executive, said BP remained as committed as ever to exploring new energy sources and the non-oil division would benefit from the extra focus of being brought back in house……..Full Article: Source

Carbon trading must die, so the planet can live

Posted on 29 June 2009 by VRS  |  Email |Print

From In his 2006 bestseller about climate change, Heat, British writer George Monbiot said his biggest worry was not that people would stop talking about climate change. His fear was that they’d talk us to kingdom come.

Looking at the Australian Senate “debate” the Carbon Pollution Reduction Scheme (CPRS) last week, this fear is well founded……..Full Article: Source

June 2009
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