News Round-Up, August 15, 2023
The Best in the Biz – August 10, 2023
Posted to Energy Centralin the Utility Management GroupEPA Plan Would Impose Drastic Cuts on Power Plant Emissions by 2040
Link to original article: https://energycentral.com/c/ee/epa-plan-would-impose-drastic-cuts-power-plant-emissions-2040
Editorial…
On the seemingly peaceful and serene day of July 28, 2011, the tranquil city of Oslo, renowned for its picturesque fjords, revered artist Edward Munch, and vibrant Vigeland Park, was struck by an unimaginable horror that no one could have anticipated. On this fateful day, the capital of Norway became the epicenter of deadly acts of terror: Oslo and Utøya Island fell victim to brutal attacks that shook the nation to its core.
The first blast targeted government offices, leaving behind devastation and despair. However, the horrors were far from over. During this chaos, Norway was about to witness an even more horrifying act. On the peaceful Utøya Island, a youth camp was abruptly transformed into a blood-soaked battleground. A lone gunman, chillingly disguised as a police officer, mercilessly opened fire on the unsuspecting camp attendees. Sixty-nine young individuals, filled with hopes and dreams, were ruthlessly torn away from their loved ones, forever etching their names into the darkest annals of Norwegian history.
Over the past few years, criminal activity has become a worldwide threat. The current statistics are alarming, with homicides taking the lives of almost half a million people globally. Surprisingly, this number is higher than the deaths caused by armed conflicts and terrorist attacks during the same period. Latin American criminal groups have played a crucial role in increasing crime rates in the region. These groups frequently operate with a twisted notion of loyalty, engaging in violent conflicts over territories to dominate and control lucrative illegal activities. Their influence goes beyond local communities, spreading into diverse aspects of society and perpetuating cycles of violence.
In Europe, the widespread availability of firearms worsens the hazards of criminal activities. As guns are easily accessible, criminals become more confident, increasing armed robberies, gang violence, and even terrorist attacks. Recognizing the urgency of addressing this crisis, the United Nations implemented the "Sustainable Development Goal 16" to decrease violence and associated deaths by 2030. Nonetheless, the current crime rate persists. Therefore, achieving the goal on time is likely.
A diverse approach is necessary to tackle crime and ensure community safety. Such an approach should involve investing in social programs that address the root causes of crime, encourage education and skills development, enable economic opportunities, and bolster international cooperation to dismantle transnational criminal networks.
On Sunday, this blog took to Twitter to share an article that has since taken the internet by storm. Entitled "Hemingway and the 'Gang' say: 'Farewell To The Arms...'," the story explores the incredible social project known as Project Alcatraz, driven by Santa Teresa Hacienda in Venezuela.
Responding to the escalating challenge of gang-related activities, the visionary minds of Santa Teresa Hacienda decided to establish Project Alcatraz. Little did they know that this decision would begin an extraordinary endeavor that would reshape lives and offer hope to countless individuals.
From its beginnings, Project Alcatraz has undergone notable transformations, blossoming into a comprehensive initiative dedicated to recruiting and rehabilitating individuals involved in criminal gangs. Multifaceted strategies have been used in this program to foster successful reintegration.
Today, we are thrilled to announce that the article has garnered close to 80,000 views and has received overwhelmingly positive feedback from readers. This level of engagement is a testament to the power of the story, resonating the well-done impact of Project Alcatraz.
Most read…
Experts Scrutinize Hawaiian Electric as They Search for the Maui Wildfire Cause
The main utility serving Hawaii did not pre-emptively shut off power before high winds reached Maui, and power lines fell in the windstorm.
NYT by Peter Eavis, Ivan Penn and Thomas Fuller, Aug. 14, 2023How (Many) Economists Missed the Big Disinflation
NYT by Paul Krugman, Opinion Columnist, August 14, 2023 Far-Right Libertarian Wins Argentina’s Presidential Primary
Javier Milei, who wants to abolish the central bank and adopt the U.S. dollar as Argentina’s currency, is now the front-runner in the fall general election.
NYT by Jack Nicas, Natalie Alcoba and Lucía Cholakian Herrera, Reporting from Rio de Janeiro and Buenos Aires, Augus 14, 2023Russia Raises Interest Rates to 12% After Ruble Plummets
The Moscow Time by Jake Cordell, 5 hours agoHemingway and the “gang” say: “Farewell To The Arms…
By GERMÁN & CO, August 13, 2023Trump Indicted in Georgia for Election Interference Scheme Along With 18 Others
TIME BY BRIAN BENNETT AND ERIC CORTELLESSA, AUGUST 14, 2023 The AES Corporation is committed to accelerating the future of energy transitions by delivering greener and more innovative solutions. AES firmly believes that energy infrastructure plays a crucial role in ensuring the sustainability of our sector. Recently, the AES President and CEO, Andrés Gluski, had the privilege of moderating a captivating discussion titled "Harnessing Diplomacy for the Energy Transition and Universal Access" at the @EEI_Intl panel. This engaging conversation highlights the importance of collaboration and innovative approaches in driving the energy transition forward.
In Lahaina and other towns in West Maui last week, downed power poles and lines littered the highway, blocking roads in some cases. Credit...Philip Cheung for The New York TimesExperts Scrutinize Hawaiian Electric as They Search for the Maui Wildfire Cause
The main utility serving Hawaii did not pre-emptively shut off power before high winds reached Maui, and power lines fell in the windstorm.
NYT by Peter Eavis, Ivan Penn and Thomas Fuller, Aug. 14, 2023In the hunt to determine what caused the fire that consumed Lahaina, the focus has increasingly turned to Hawaii’s biggest power utility — and whether the company did enough to prevent a wildfire in the high winds that swept over Maui last week.
Lawyers for Lahaina residents suing the utility, Hawaiian Electric, contend that its power equipment was not strong enough to withstand strong winds, and that the company should have shut down power before the winds came. Wildfire experts who have studied the catastrophic fires in California over the past two decades also see shortcomings in Hawaiian Electric’s actions.
Nearly a week after the wildfire tore through the island town of Lahaina, state and local officials have not determined a cause for the blaze that killed at least 99 people. But the explosive conditions were similar to those elsewhere in the country where wildfires were sparked by electrical equipment: dry brush, high winds and aging infrastructure.
Many wildfires in the United States occur when poles owned by utilities or other structures carrying power lines are blown down, or when branches or other objects land on power lines and cause them to produce high-energy flashes of electricity that can start fires. That is why utilities in California and other states have at times shut down power in recent years before strong winds arrive.
The National Weather Service expected winds of up to 45 miles per hour last Tuesday, with gusts of 60 miles per hour — conditions that were amplified by Hurricane Dora, which traveled across the Pacific Ocean about 700 miles to the south.
“We allege that many of the regulatory laws that require maintenance of equipment were broken,” said James Frantz, chief executive of the Frantz Law Group, one of several law firms taking action against Hawaiian Electric. “There’s got to be some accountability.” He said his firm was representing five Lahaina residents who were filing lawsuits in a Hawaiian state court on Monday.
Nearly a week after the wildfire tore through Lahaina, state and local officials have not determined a cause for the blaze that killed at least 96 people. Credit...Max Whittaker for The New York Times
Shares in Hawaiian Electric lost over a third of their value on Monday, a sign that investors feared that the company would have to pay out large sums to settle lawsuits filed by homeowners and businesses, and spend enormous amounts to try to fireproof its operations.
“The issue becomes whether they did everything they could that was reasonable to prevent this incident,” said Shahriar Pourreza, an analyst who covers Hawaiian Electric’s stock for Guggenheim Securities. “Was there gross negligence, was there imprudence?”
Hawaiian Electric, established in 1891, operates on Maui through its subsidiary, Maui Electric, and is tiny compared with the Californian utilities that have paid huge wildfire settlements. Its revenue last year totaled $3.7 billion, compared with $21.7 billion at Pacific Gas and Electric of California. Like most other utilities, Hawaiian Electric operates under the scrutiny of public commissioners who have to approve its spending plans.
At a news conference on Monday, Shelee Kimura, the chief executive of Hawaiian Electric, said the company did not have a shut-off program and contended that cutting the power could have created problems for people using medical equipment that runs on electricity.
She also said turning off the power would have required coordination with emergency workers. “In Lahaina, the electricity powers the pumps that provide the water — and so that was also a critical need during that time,” Ms. Kimura said. “There are choices that need to be made — and all of those factors play into it.”
In Lahaina and other towns in West Maui last week, downed power poles and lines littered the highway, blocking roads in some cases. It was unclear how much of the equipment had been tossed over by the strong gusts of wind and how much of it was damaged by the fire.
Power lines have caused catastrophic wildfires in California in recent years, prompting lawsuits that have led to multibillion-dollar payouts by the state’s utilities. Pacific Gas and Electric filed for bankruptcy in 2019 and agreed to pay $13.5 billion to settle claims relating to destructive wildfires, including the Camp Fire, which destroyed the Northern California town of Paradise and killed 85 people.
The Federal Emergency Management Agency and the Pacific Disaster Center, a firm based in Hawaii that provides disaster-related analysis, said on Saturday that more than 2,000 structures had been damaged or destroyed by the recent fires on Maui. And they estimated that it would cost $5.52 billion to rebuild. Mr. Pourreza, the analyst, said in a research note that there was a scenario in which Hawaiian Electric’s liability from the fire could exceed $4 billion. It had $314 million in cash at the end of June.
Pre-emptive power shutdowns are unpopular, because of how disruptive they can be to individuals and businesses. But wildfire experts say that they are a necessary measure, and, with planning, they can be deployed in such a way that they don’t prevent emergency services from operating during the blackout.
“It keeps people safe,” said Michael Wara, a scholar focused on climate and energy policy at Stanford University.
Lightning strikes have been another common source of ignition for wildfires in the Western United States. While not definitive, satellite-based lightning detectors operated by NASA did not indicate lightning activity on Hawaii last Monday or Tuesday.
Local and state officials have said little about what might have caused the fire that eventually engulfed Lahaina on the afternoon of Aug. 8. Earlier that day, Maui County said it had completely contained a small brush fire that was first reported that morning, but later announced at 4:45 p.m. that “an apparent flareup” had forced the closure of one main road and sudden evacuations.
Data from Whisker Labs, a private company that monitors the electrical grid in cities across the country looking for problems that might spark a home fire, appears to show significant faults — or major incidents — on power lines near where the Tuesday morning blaze is believed to have started.
On the night of Aug. 7 and into the early morning hours, its data showed, power lines began losing voltage, which can happen when vegetation interferes with wires, lines touch power poles or electrical equipment malfunctions.
The company said it had almost 1,000 sensors in Hawaii and about 70 on Maui. A major fault was felt by all sensors on the island, but was strongest near Lahaina, Whisker Labs found.
And it was a full eight seconds, “which is an eternity in electrical grid time,” said Bob Marshall, co-founder and chief executive of Whisker Labs, based in Germantown, Md. “Something on the grid was very unhappy for eight seconds and trying to recover from a shock.”
Hawaiian Electric, through Jim Kelly, a spokesman, declined to comment on Whisker Labs’ data and findings.
Ken Pimlott, the former chief of the California Department of Forestry and Fire Protection, said in an interview on Sunday that the notion that power lines might have started the fire was plausible.
He said the Maui fire recalled the 2017 Tubbs fire in California, which tore through wine country north of San Francisco. That fire was caused by private electrical equipment and quickly spread through communities lined up and down steep slopes. As was the case in West Maui, the Northern California community was on the edge of wild lands, making it more vulnerable.
Wildfire experts who have studied the catastrophic fires in California over the past two decades see shortcomings in Hawaiian Electric’s actions. Credit...Philip Cheung for The New York Times
Hawaii’s attorney general, Anne Lopez, said on Friday that she would be “conducting a comprehensive review of critical decision-making and standing policies leading up to, during, and after the wildfires on Maui and Hawaii islands.”
Mr. Wara, of Stanford, said Hawaiian Electric appeared to have ample time to shut down power. He noted that before the high winds hit, the company took the precaution of turning off reclosers, equipment designed to restart the flow of power after an outage.
Hawaiian Electric in a regulatory filing last year detailed measures aimed at reducing the risk of its equipment causing fires. Among other things, the filing said the company was “hardening” poles to withstand high winds and cutting back vegetation, noting that Lahaina was a priority area.
But such measures can take time to complete and be very expensive. Burying power lines costs $3 million to $5 million per mile, said Mr. Wara, who was a member of a California commission that advised lawmakers after the Camp Fire on how to hold utilities accountable for wildfire costs and risks. Typically, such costs are added to customers’ bills under regulatory rules — and Hawaii’s electricity rates are already by far the highest in the United States, according to the U.S. Energy Information Administration.
“Why did they not do the cheap thing — turn the power off?” Mr. Wara said.
Credit...Illustration by Akshita Chandra/The New York Times; Photograph by Larry WashburnHow (Many) Economists Missed the Big Disinflation
NYT by Paul Krugman, Opinion Columnist, August 14, 2023 In economics, as in life, it’s really important to learn from your mistakes. The learning process begins when you say the magic words “I was wrong,” which sets you free to ask why you were wrong and do better next time.
Those of us who failed to predict the big run-up of inflation in 2021-22 are, I think it’s fair to say, well along on that process. But it’s not clear to me that economists who had predicted that getting inflation under control — it’s down a lot, although not all the way — would require years of very high unemployment are engaging in a similar reckoning.
They should. In particular, they should ask themselves whether inflation pessimism was in part caused by a form of bias that has had negative effects on a lot of economic policymaking — not partisan bias, but the urge to sound serious by calling for hard choices and sacrifice.
Before I get to that, however, let me talk about what went wrong with so many recent economic predictions.
I’ve been looking at what you might call mainstream predictions about inflation and unemployment made late last year — economic projections by the Federal Reserve and by professional forecasters surveyed by the Philadelphia Fed. Perhaps surprisingly, both more or less correctly predicted the inflation decline we’re actually seeing.
The survey of forecasters predicted consumer inflation (excluding volatile food and energy prices) of 3.5 percent for the whole of 2023; given actual price increases so far this year, this would require inflation for the rest of the year to run at 2.7 percent, which seems quite reasonable given recent data. The Fed predicted that the core personal consumption expenditures deflator, a similar measure, would rise 3.5 percent over the course of the year; this will also come close if inflation for the rest of the year is 3 percent or less, which again seems reasonable.
Both forecasts, however, assumed that disinflation would require a substantial rise in unemployment. The professional forecasters predicted 4.4 percent unemployment by the fourth quarter, the Fed 4.6 percent. Since the actual unemployment rate in July was only 3.5 percent, to meet those predictions would require that the economy fall off a cliff starting just about now — and there are no signs that this is happening.
Yet most of the criticism I heard of the Fed and others berated them for excessive optimism. Getting inflation down, a chorus of economists insisted, would require much bigger increases in unemployment. Most famously, Larry Summers declared that we would need something like two years of 7.5 percent unemployment to get inflation down to 2 percent, but others offered broadly similar if less extreme diagnoses.
OK, we haven’t reached 2 percent yet (and it’s not clear that we even should), but surely we’ve seen enough to conclude that such claims were wildly off base. So, have the pessimists come to terms with that reality?
Well, I’m still seeing a lot of excuses — two, in particular.
I’m still seeing a lot of excuses — two, in particular. One is the claim that much of the progress against inflation is in some sense illusory, that underlying inflation is still well above 4 percent. Now, there are enough measures of underlying inflation out there that if you pick and choose you can still manage to be pessimistic, but the preponderance of the evidence — plus the results of hands-free algorithms that use a consistent procedure to extract the signal from the noise — suggests underlying inflation around 3 percent and dropping.
The other is the claim that disinflation pessimists were simply applying standard economic models, so that the fault lay in the models, not themselves.
But that’s simply not true. Standard models say that disinflation is very costly if persistent high inflation has become entrenched in expectations. And it was or should have been clear, even a year ago, that this wasn’t a good description of the current U.S. economy. That’s not 20/20 hindsight: I argued a year ago, at the peak of inflation pessimism, that analogies with the painful aftermath of the 1970s were all wrong. And I was, frankly, shocked to see smart economists blithely ignoring the obvious differences in circumstances.
Did I expect disinflation to come as painlessly as it has? No. Even inflation optimists clearly need to do some rethinking. But inflation pessimists really need to do what inflation optimists did a year ago, and ask how they got it so wrong, effectively calling for policies that would have put millions out of work.
As I said, it wasn’t partisanship; America’s right has become so divorced from empirical reality that it has played no role in this debate. What I do suspect, however, is that some very good economists got caught up in a version of the Very Serious People problem of the 2010s, in which the desire to seem hardheaded led many elite voices to obsess over budget deficits when they should have been focused on inadequate job creation.
The good news is that while the Fed did, in effect, try to engineer a recession to control inflation, it didn’t succeed: Despite rising interest rates, the economy just kept chugging along. Why that happened is another question. But pessimists really need to grapple with the fact that disinflation happened anyway.
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Source: MediaFar-Right Libertarian Wins Argentina’s Presidential Primary
Javier Milei, who wants to abolish the central bank and adopt the U.S. dollar as Argentina’s currency, is now the front-runner in the fall general election.
NYT by Jack Nicas, Natalie Alcoba and Lucía Cholakian Herrera, Reporting from Rio de Janeiro and Buenos Aires, Augus 14, 2023Who is “don” Javier Milei?
Javier Milei is undeniably a unique character in Argentine politics. Known for his distinctive sideburns, he closely resembles iconic figures in Argentina, such as Sandro, Leonardo Favio, Carlos Menem, and even Diego Armando Maradona. In other words, he is "a sympathetic and curious thing." It is important to note that these resemblances are physical and should not be misinterpreted as ideological or political.
Described by the media as a far-right politician, economist, and former TV personality, Javier Milei recently made waves by winning the most votes in Argentina's primary election. His self-proclaimed label as an anarcho-capitalist and his admiration for former US President Donald Trump have only added to his controversial image. Milei's victory, where he secured an impressive 30% of the votes and defeated more established politicians, has been referred to as a "political earthquake" by the Argentine media. This unexpected success highlights both the growing appeal of far-right ideologies in the country and the dissatisfaction of Argentine voters with traditional political parties.
However, it is important to examine Milei's ideology and political stance critically. While his triumph may have shocked the establishment, his alignment with the far-right raises questions about his policy proposals and potential consequences for social and economic issues in Argentina.
As Milei's influence continues to grow, it will be interesting to see how he navigates the complexities of Argentine politics and whether his ideas will resonate with a broader audience. The political landscape in Argentina appears to be shifting, and it remains to be seen how Milei's rise will impact the country's future.
Milei is known for his anti-establishment views and has launched scathing attacks on his rivals from established political parties. He has stated that if elected, he would abolish Argentina's central bank, replace the peso with the US dollar, and privatize state-run companies that are making a loss. Milei is also recognized for his provocative style and often berates "the left" using expletive-laden outbursts. He is frequently seen wearing his trademark leather jacket and sporting long sideburns.
By Germán & CoA far-right libertarian candidate won Argentina’s open presidential primary election on Sunday, a surprising showing for a politician who wants to adopt the U.S. dollar as Argentina’s official currency and embraces comparisons to Donald Trump.
Javier Milei, 52, a congressman, economist and former television pundit, secured 30 percent of the vote with 96 percent of the ballots counted, making him the front-runner for the presidency in the fall general election.
Polls had suggested that Mr. Milei’s support was at about 20 percent, and political analysts had predicted that his radical policy proposals — including abolishing the country’s central bank — would prevent him from attracting many more voters.
But the vote on Sunday made clear that Mr. Milei now has a clear shot at leading Argentina, a South American nation of 46 million with some of the world’s largest reserves of oil, gas and lithium.
“I think these results are surprising even to him,” said Pablo Touzon, an Argentine political consultant. “Up until now, he was a protest candidate.”
Argentina’s general election in October, which could go to a November runoff, will now become a new test of the strength of the far right around the world. Although hard-right forces have gained new influence in several powerful nations in recent years, including the United States, Germany, France, Italy, Sweden and Finland, they have also suffered some defeats, including in Spain and Brazil.
Mr. Milei has pitched himself as the radical change that the collapsing Argentine economy needs, and he could be a shock to the system if elected. Besides his ideas about the currency and the central bank, he has proposed drastically lowering taxes and cutting public spending, including by charging people to use the public health care system; closing or privatizing all state-owned enterprises; and eliminating the health, education and environment ministries.
Sergio Massa, Argentina’s center-left finance minister, finished second in the primary, with 21 percent of the vote. Patricia Bullrich, a conservative former security minister, finished in third place, with 17 percent.
The general election takes place on Oct. 22, but it appears likely that the race will be decided in a runoff vote on Nov. 19.
The Sunday results showed that Argentina’s three separate coalitions have similar levels of support, making it unlikely that any candidate will reach or exceed the 45-percent threshold necessary to win outright in the first round. (A candidate can also win outright by winning 40 percent of the vote with a margin of victory of at least 10 percentage points.)
The center-right coalition’s candidates received a combined 28 percent of the vote on Sunday, while the center-left coalition received 27 percent — both slightly less than Mr. Milei’s total.
The incumbent center-left party has held power in Argentina for 16 of the past 20 years and has been controlled largely by former President Cristina Fernández de Kirchner.
“We’re not only going to end Kirchnerism, but we’re also going to end the useless, parasitic, criminal political caste that is sinking this country,” Mr. Milei told supporters in a speech on Sunday night. He then thanked his sister, who runs his campaign, and his five Mastiff dogs, each named after a conservative economist.
Argentina, which has weathered economic crises for decades, is in the midst of one of its worst. The Argentine peso has plummeted in value, annual inflation has surpassed 115 percent, nearly 40 percent of the population is impoverished and the country is struggling to repay its $44 billion debt to the International Monetary Fund.
Mr. Milei has said that his economic policies would represent an austerity package that goes beyond even what the I.M.F. is requesting of Argentina.
He could also have a profound effect on other parts of Argentine society. He and his running mate, a lawyer who has defended the country’s past military dictatorship, have suggested they would loosen gun laws, reverse recent policies allowing abortion and even permit the sale of human organs, an example of commerce that Mr. Milei says the government has no business restricting.
Yet implementing such changes would lead to a major challenge. Sunday’s results suggested that Mr. Milei, if elected, would have limited direct support in Congress. His party, called Liberty Advances, said it would control just 8 of the 72 seats in the Senate and 35 of the 257 seats in the House, according to the results for its other candidates.
Supporters of Mr. Milei in Buenos Aires on Sunday. His outsider status and radical economic proposals appealed to more voters than analysts had expected.Credit...Mario De Fina/Associated Press
Mr. Touzon said Mr. Milei would have less institutional support than far-right candidates who were swept into office elsewhere in recent years, including Mr. Trump and former President Jair Bolsonaro of Brazil. “Bolsonaro leaned on the army. Trump had the Republican Party. Milei has nothing,” he said.
He added that Mr. Milei’s economic plan, while radical, is lacking in details and has been revised frequently. “His dollarization plan was changed 50 times,” Mr. Touzon said. “Today, he does not have a team to govern Argentina.”
Yet Mr. Milei has proved to be a skilled politician in the internet age, with a trademark scowl and head of unruly hair that have given him a larger-than-life persona and made him an easy subject of internet memes, much like Mr. Trump and Mr. Bolsonaro.
In a public video posted online ahead of the vote, Mr. Bolsonaro endorsed Mr. Milei and said they were political kindred spirits. “We have a lot of things in common,” he said, citing what he called their support for private property, freedom of expression, the free market and the right to self-defense.
And not unlike supporters of Mr. Trump and Mr. Bolsonaro, Argentines who voted for Mr. Milei said on Sunday that they liked him because he was a political outsider who would shake up a broken system and tell it like it is.
“The Argentine people have finally woken up,” said Rebeca Di Iorio, 44, an administrative worker celebrating at Mr. Milei’s election-night street party in Buenos Aires. “Argentina needs that. It needs a change.”
Santiago Manoukian, research chief of Ecolatina, an Argentine economic consulting firm, said that of the different scenarios for primary results that analysts had mapped out, Mr. Milei’s victory was the least expected.
Now Mr. Manoukian said he would have to rethink his predictions of the election, as Mr. Milei has a clear chance to reach the second round, which then could be a tossup.
“He was not seen as a competitive candidate for a runoff,” Mr. Manoukian said. “Now something very different is happening.”
An earlier version of this article misstated the number of seats in Argentina’s lower house of Congress. It has 257 seats, not 500.
An earlier version of this article misidentified how a candidate could win the election outright and avoid a runoff. A candidate needs either 45 percent of the vote, or 40 percent and a margin of victory of at least 10 percentage points, not 50 percent of the vote.
Image: Germán & CoCooperate with objective and ethical thinking…
Russian Central Bank Governor Elvira Nabiullina.Alexander Koryakov / KommersantRussia Raises Interest Rates to 12% After Ruble Plummets
The Moscow Time by Jake Cordell, 5 hours agoRussia’s Central Bank hiked interest rates from 8.5% to 12% on Tuesday in an emergency meeting after the ruble slid past 100 against the U.S. dollar the day before.
“The decision is aimed at limiting price stability risks,” the Bank said in a statement.
The ruble gained strongly ahead of the decision, rising by more than 2% to around 95 against the U.S. dollar, before paring gains to fall back below 98 after the rate hike was announced, Moscow Exchange data showed.
It was the first extraordinary meeting of the Bank’s board of directors since Feb. 28, 2022, when the regulator raised interest rates to 20% in the wake of Moscow’s invasion of Ukraine just days earlier.
Kremlin Unfazed as Ruble Crashes Through 100 vs. Dollar
A devaluation in the Russian currency has gathered pace in recent weeks, triggering concerns it could set off an inflationary spiral and panic in Russia’s domestic financial markets.
In its statement, the Bank said surging demand at home — which includes a rapid increase in state spending on the war in Ukraine — was causing the economy to overheat.
“Steady growth in domestic demand surpassing the capacity to expand output amplifies the underlying inflationary pressure and has an impact on the ruble’s exchange rate dynamics,” it said.
Ahead of the move, analysts at Alfa Bank said a key rate of around 12% could help stabilize the currency.
“Perhaps with the help of a rate increase, the Central Bank expects to slow down domestic demand and reduce imports. But this will only have an indirect effect on the ruble exchange rate,” they wrote in a research note.
A fall in Russia’s export sales, a recovery in imports and surging government spending to help fund the invasion of Ukraine have all contributed to a weakening ruble and rising inflation, analysts say. The Central Bank itself has been warning of inflationary pressures for almost a year, following Russia's mobilization of some 300,000 reservists in September.
Inflation is currently running at 4.4%, the bank said in its statement — above its official 4% target — and is set to accelerate toward 6.5% by the end of this year, according to official forecasts. Other measures of price rises, including core inflation and seasonally-adjusted inflation were running above 7%, the central bank said on Tuesday.
“The pass-through of the ruble’s depreciation to prices is gaining momentum and inflation expectations are on the rise,” it said in a statement, adding there were “substantial” risks that inflation would not be brought back down to 4% until after 2024.
Tuesday’s hike came after Maxim Oreshkin, an aide to Russian President Vladimir Putin, publicly called for higher borrowing costs to address the ruble’s woes, in a rare criticism of the regulator’s policy from the Kremlin.
Central Bank governor Elvira Nabiullina, previously an economic advisor to Putin, is seen in Moscow as an astute operator who has been instrumental in helping Russia’s economy weather a barrage of Western sanctions and the economic fallout of the war.
Analysts say the falling ruble is both a blessing and a curse for the Kremlin.
A weaker currency increases Russia’s revenue from energy sales, which are priced in dollars, helping offset lost income from lower exports. The price in rubles for a barrel of Russia’s Urals oil has more than doubled since the start of the year.
However, it could also trigger financial panic and inflation at home, by pushing up prices for goods that use imported parts and even for some domestically-produced agricultural products, where the price is dictated by international markets.
Last week a state TV presenter, Vladimir Solovyov, slammed the Central Bank on a broadcast of his online show, calling on Nabiullina to halt the slide in the ruble ahead of the upcoming presidential election, scheduled for March 2024. Putin is certain to win the race, which independent observers and rights groups say will be neither free nor fair, but the Kremlin would prefer not to have Russians head to the polls against the backdrop of an economic crisis.
Russia’s economy has become increasingly militarized in the 18 months since Russia invaded Ukraine, with a massive ramp-up in arms production and payments to soldiers offsetting a sharp drop in retail sales, foreign investment and energy exports.
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Image by Germán & CoHemingway and the “gang” say: “Farewell To The Arms…
By GERMÁN & CO, August 13, 2023Project "Alcatraz": A Comprehensive Initiative for Gang Rehabilitation and Reintegration by Santa Teresa...
“If you treat an individual as he is, he will remain how he is. But if you treat him as if he were what he ought to be and could be, he will become what he ought to be and could be.”
―JOHANN WOLFGANG VON GOETHEIt is the cruelest reality imaginable...
Criminal activity has become a worldwide threat recently. The current statistics are alarming, with homicides taking the lives of almost half a million people globally. Surprisingly, this number is higher than the sum of deaths caused by armed conflicts and terrorist attacks during the same period.
To deal with the problem effectively, it's crucial to comprehend the intricate relationships between Latin American gangs, the widespread availability of firearms in Europe, and the extent of organized crime. Latin American criminal groups have played a crucial role in the increase of crime rates in the region. These groups frequently operate with a twisted notion of loyalty, engaging in violent conflicts over territories to dominate and control lucrative illegal activities. Their influence goes beyond local communities, spreading into diverse aspects of society and perpetuating cycles of violence.
In Europe, the widespread availability of firearms worsens the hazards of criminal activities. As guns are easily accessible, criminals become more confident, leading to an increase in armed robberies, gang violence, and even terror attacks. Recognizing the urgency of addressing this crisis, the United Nations implemented “Sustainable Development Goal 16”, which aims to decrease violence and associated deaths by 2030. Nonetheless, the current crime rate persists. Therefore, achieving the goal on time is likely.
To effectively tackle crime and ensure community safety, a diverse approach is necessary. Such an approach ought to involve investing in social programs that address the root causes of crime, encourage education and skills development, enable economic opportunities, and bolster international cooperation to dismantle transnational criminal networks.
A déjà vu of goodness…
On a chilly autumn evening, the “Spirit of Good Hope” entered a bustling café on Rue de l'Abreuvoir in Paris. It seemed familiar. The Spirit felt like he had been there before; he enjoyed the cozy ambiance and was captivated by the café's charm. The air was filled with the aroma of freshly brewed coffee, mingling with the gentle buzz of conversation permeating the room. It wasn't fleeting, though. It was a positive repetition that set the tone for the evening. The Spirit felt a profound sense of hope, as if tonight was different from other nights. Approaching the counter, he had a smile spread across his face. He said to the barista, "Un café au lait avec du rhum Santa Teresa, s'il vous plaît," with a hint of excitement in his voice. He ordered this drink every time. It was ideal for this time of year when the weather was cold. In the dimly lit café, a poignant scene unfolded, reflecting the intense emotions of this extraordinary gathering. Ernest Hemingway filled the room with his gray beard, exuding rugged charm. Surrounding him, the young "gang" members held court, their faces bearing tattoos and scars from their struggles and battles fought on the unforgiving city streets.
The conversation drifted through the smoky haze, blending past and present and forging an unexpected connection between two contrasting worlds. Hemingway acknowledged the profound impact guns have had on gang members. In the weathered writer, these resilient individuals discovered a kindred spirit who understood their conflicting natures. The gang's weapons were a source of power and control in a world constantly challenging their lives. These weapons gave them a semblance of strength and protection through their tumultuous existence. But beneath the surface, guilt seethed—an undeniable truth they could not escape. The countless lives lost in the crossfire haunted their consciences, leaving scars that would never fully fade. Hemingway, too, understood the weight of guns on the human soul. Through his experiences as a soldier first and a writer afterwards, he witnessed the devastating effects of war. The weapons that once filled his hands had penetrated the depths of his being, leaving scars that time would never heal. He carried the ghosts of those he had lost, constantly reminding him of the devastating toll of violence.
As they talked, an unspoken understanding began to develop. Despite the differences that separated them, Hemingway and the gang members found common ground in the profound impact that guns had on their lives. Through their shared experiences, they formed an unlikely bond, providing a moment of relief from the adversity molded by the destructive forces of the past. They yearned to break free from the chains that held them captive. And so, on that fateful night, they conceived a noble path - the Alcatraz Project - with the audacious purpose of bidding farewell to the arms.
Inspired by the noble soul of Saint Teresa Of Avila…
The teachings and spirituality of Saint Teresa of Avila, a nun renowned for her devotion to praying for the most vulnerable, have had a profound influence on the Wollmer family, who own Hacienda Santa Teresa in the Aragua Valley, a key region in Venezuela's sugar industry. The family, deeply moved by her teachings and spiritual beliefs, embraced the principles that would later be recognized as corporate social responsibility, long before it became a popular trend.
Hacienda Santa Teresa is the home of "Santa Teresa," Venezuela's oldest rum brand, with a rich history dating back to 1796. Originally focused on cultivating coffee, cocoa, and sugarcane, the hacienda ventured into rum production in 1830 and has persevered through numerous challenges, including wars, revolutions, dictators, and even the ongoing pandemic. Although the company produces various rum, only one, the "Santa Teresa 1796 Solera Rum," is designated for exportation. This particular expression was introduced in 1996 to commemorate the bicentennial of the hacienda and is managed internationally by Bacardi Ltd.
Through their commitment to Saint Teresa's teachings and spiritual values, the Wollmer family has nurtured a brand that embodies tradition, resilience, and respect for its community and the environment. Hacienda Santa Teresa's enduring legacy as a producer of exceptional rum highlights the family's dedication to their craft and their unwavering belief in the principles that were inspired by Saint Teresa herself.
The brand has a long history of community involvement. The organization's most renowned endeavour is the ongoing Project “Alcatraz”. In 2003, a criminal gang unlawfully entered the Hacienda premises and launched a surprise attack on a security guard. When apprehended, the perpetrators were presented with an unconventional option:
“Either surrender to the authorities or engage in labour at the Hacienda to restate their transgression…
Project "Alcatraz"…
In response to the ever-growing challenge of gang-related activities, the offer to establish Project "Alcatraz" was accepted, marking the beginning of a remarkable endeavor. Since its inception, Project "Alcatraz" has evolved into a comprehensive initiative dedicated to the recruitment and rehabilitation of individuals involved in criminal gangs.
Drawing upon a multi-faceted approach, this program employs a range of strategies to foster the reintegration of these individuals into society. One core aspect of Project "Alcatraz" is vocational training, equipping participants with essential skills and expertise necessary for employment and self-sustainability. Moreover, value formation plays a key role in instilling a sense of moral compass and social responsibility.
Recognizing the importance of addressing underlying psychological issues, Project "Alcatraz" also provides psychological counseling to its participants. By addressing the root causes of their involvement with criminal gangs, this counseling plays a pivotal role in guiding them towards positive and productive paths.
Formal education is another vital component of the program. Through academic pursuits, participants have the opportunity to expand their knowledge and develop a solid foundation for future success. By fostering intellectual growth, Project "Alcatraz" helps break the cycle of criminal activity and opens doors to new possibilities.
An unexpected aspect of the rehabilitation process embraced by Project "Alcatraz" is the involvement of its participants in the sport of rugby. Beyond its physical benefits, rugby serves as a powerful tool for instilling discipline, teamwork, and self-esteem. This sport offers a unique opportunity for personal development and camaraderie, contributing to the overall success of the program.
Since its establishment, Project "Alcatraz" has witnessed the participation of numerous young people aiming to leave behind a life of crime. Through its far-reaching initiatives, the program has successfully reintegrated many individuals into society, providing them with a chance for a fresh start. The unwavering commitment and dedication of the Project "Alcatraz" team have paved the way for transformation and hope in the lives of those previously trapped in a cycle of gang-related activities.
Looking forward, as Project "Alcatraz" continues to grow and evolve, it serves as a beacon of progress and renewal in the realm of gang rehabilitation. With its holistic approach and undeniable impact, this initiative stands as a testament to the power of compassion, perseverance, and the belief in the potential for redemption in every individual.
IMAGE BY GERMAN & CoTrump Indicted in Georgia for Election Interference Scheme Along With 18 Others
TIME BY BRIAN BENNETT AND ERIC CORTELLESSA, AUGUST 14, 2023 Agrand jury in Georgia voted to indict Donald Trump on Monday, along with more than a dozen of his allies, for trying to overturn his 2020 election loss in the state, marking the fourth criminal case leveled against the former President this year and the second related to his efforts to stay in power.
Fani Willis, the Fulton County District Attorney, charged Trump with 13 counts, including violating state racketeering laws and soliciting a public official to violate his oath of office, conspiring to commit forgery in the first degree, conspiring to file false documents, and making false statements.
"Trump and the other Defendants charged in this indictment refused to accept that Trump lost, and they knowingly and willfully joined a conspiracy to unlawfully change the outcome of the election in favor of Trump," the indictment reads.
The sweeping charges in Georgia are almost certain to add to Trump’s already packed court schedule and increase his legal bills as he aims to win the GOP presidential nomination and reclaim the White House.
Special Counsel Jack Smith indicted Trump earlier this month on four federal charges, including knowingly spreading lies about election malfeasance, defrauding the U.S. government by orchestrating a scheme to present fake electors to the Electoral College, and engaging in a conspiracy to obstruct an official proceeding, which culminated with his supporters violently storming the U.S. Capitol on Jan. 6, 2021. Smith is separately prosecuting Trump for mishandling classified documents at Mar-a-Lago, in a case set to go to trial in May. At the same time, Manhattan District Attorney Alvin Bragg is set to take Trump to trial in March on 34 counts of falsifying business records.
Several of Trump’s rivals for the GOP presidential nomination have said they would pardon him if elected. Trump has also routinely claimed that a president can pardon himself. But the latest charges out of Georgia present a unique danger to Trump’s future freedom. Notably, no president could grant Trump clemency in the Georgia and New York cases, as presidential pardon power only applies to federal charges. In Georgia, only an independent state board enjoys pardon authority.
The Fulton Country indictment is focused on five main areas of legal impropriety, including the deliberate dissemination of election fraud falsehoods by Trump allies to manipulate the Georgia legislature; Trump’s efforts to intimidate state officials, including Georgia's Secretary of State Brad Raffensperger, to overturn Biden’s victory; the breach of voting data in Georgia’s rural Coffee County; the targeted abuse and harassment of state election workers; and the orchestrated attempt to send alternate electors slates to Congress to undermine the will of the voters.
Willis didn’t stop with Trump. A number of his closest associates were also charged under Georgia’s anti-racketeering law for conspiring to nullify the election, including Rudy Giuliani, the former New York mayor who was Trump’s personal attorney at the time; former White House Chief of Staff Mark Meadows; attorneys John Eastman and Kenneth Cheseboro, both of whom devised a scheme to send alternate Trump electors to the Electoral College; and other lawyers in Trump’s orbit who pushed wild or legally dubious theories for how to reverse the election outcome, such as Sidney Powell and Jenna Ellis. A handful of Georgia-based Trump attorneys and advisers were also included in the indictment.
All in all, the historic indictment brought a grand total of 41 charges against 19 people. They collectively face a gamut of different charges but are all being prosecuted under the Georgia Racketeer Influenced and Corrupt Organizations Act, what are known in legal parlance as RICO Statues, which have typically been used to prosecute members of the mob.
In a statement Monday night, Trump’s campaign dismissed the new indictments as a partisan attempt to kneecap his 2024 campaign. “Ripping a page from Crooked Joe Biden’s playbook, Willis has strategically stalled her investigation to try and maximally interfere with the 2024 presidential race and damage the dominant Trump campaign,” it said. “All of these corrupt Democrat attempts will fail."
The campaign’s comments were less vituperative than Trump’s own attacks on Willis, who he has called a “racist” and “Phoney Fani” and has baselessly accused of having an affair with a gang member she once prosecuted, a claim that Willis has denied and has since been debunked.
Trump has strenuously fought to stop Willis’s case in its tracks. In July, he filed and lost a petition to the Georgia State Supreme Court to bar Willis from prosecuting him. The request, if granted, would have also forced the investigative special grand jury that met last year to toss out the final report.
The Georgia case will test just how far someone with outsized political power can influence the election process. Trump is being prosecuted under more than a dozen charges to use his weight as president to illegally change the vote tallies and send fake electors to Washington to alter the election result.
The Willis investigation into Trump dates back to early 2021, shortly after The Washington Post reported on a Jan. 2, 2021 phone call in which Trump asked Georgia's Secretary of State Brad Raffensperger, a fellow Republican, to "find" 11,780 votes—one more than the number he lost by in the decisive swing state. Raffensperger refused. At that point, Georgia officials had already counted the votes three times, won multiple lawsuits over the outcome, and debunked extravagant fraud claims from Trump's team. At each turn, Biden’s victory was confirmed irrefutably. Trump has said he did nothing wrong, calling the phone was “perfect”
But while many legal analysts have characterized the leaked conversation as something of a smoking gun, Willis has presented a much broader case, as her investigators have examined an extensive and multi-faceted effort by Trump to exert political muscle and disseminate brazen lies to remain in office despite the will of the voters.
Trump’s allies, including Rudy Giuliani, harassed election workers and propagated patently false claims of a rigged election. On Dec. 14, 2020, the same day Biden’s electors were confirmed, a group of 16 fake electors met separately at the state capitol building to sign a false certificate stating that Trump had won the election.
A separate grand jury investigated the matter last year, and concluded that some witnesses may have lied under oath, recommending indictments in the case, according to its own report, portions of which a Georgia judge released earlier this year. The grand jury in that probe also unanimously found that “no widespread fraud took place in the Georgia 2020 presidential election that could result in overturning the election.”
Willis’s prosecution against Trump may not only increase his criminal vulnerability liability. It could also provide a road map for other jurisdictions to pursue election interference charges. Special Counsel Smith’s indictment alleges that Trump tried to influence the outcome in Georgia as well as six other states. “It certainly raises the question of whether or not there are going to be investigations in those states and potentially, if there are, if those investigations will lead to further indictments,” says Richard Serafini, a former federal prosecutor.
The more cases Trump faces, the harder it will be for him to maneuver his way out of the justice system’s grip. Some of his most famous tactics—from lying to intimidating potential foes—are more likely to yield far more severe consequences in a court of law than in the political arena. And with the Georgia charges, unlike the federal cases, he can’t hope to win the 2024 election and grant himself a pardon or appoint an attorney general who will squash the matter altogether. It’s why it may be the indictment that scares him the most.