India

NSW to lose State of Origin 4 (Adani)

Who’d a thunk? The Queensland Labor Government is fighting for its life. If it means trading principle for expediency, they have chosen the latter path. Even throwing on last-minute ‘infrastructure taxes’ couldn’t halt progress. Adani has been approved.

Labor has spent 8 years obstructing Adani Carmichael from going ahead. After the unlosable election result handed to its federal colleagues, Premier Annastacia Palaszczuk saw the light. Political suicide was at stake. It won’t stop the inevitable, especially post QLD Treasurer Jackie Trad’s deeper deficits announced this week.

What Greens Senator DiNatale fails to understand (despite saying every election hereon will be a #ClimateElection) is that Queenslanders couldn’t give a hoot for Victorians complaining about their wish to have jobs. The reality is that Adani Carmichael will likely be open for decades to come. It will employ those working at the mines and the local economies that support them.

What evidence has DiNatale got for thousands of jobs being destroyed? It is that level of economic comprehension that means they will remain such a joke as a credible party. Not least helped by the eloquence of NSW MLC Cate Faehrmann who thinks encouraging a blockade in a neighbouring state seems fair game.

There are only supposed to be three games in the State of Origin.  Faehrmann is guaranteed to lose her suggested matchup, much like former Senator Bob Brown’s convoy pre-election warm-up game concluded. Queensland will run rings around the NSW attack, as always!

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Al Gore awards Adani a badge of honour

Good to see Al Gore lay into Adani. Adani should wear it as a badge of honour given Gore’s track record of catastrophic failure with respect to his predictions. To show how out of touch he is, there is an irony that Adani, being an Indian entity, probably has more on-the-ground intel on plans for coal fired power. So luck is probably the last thing it needs.

India that has grown coal fired power gen from 61GW to 221GW. 4x in 18 years. While India might be diversifying the grid mix, coal isn’t on the way out as Gore hopes. 74% of India’s power gen is currently coal- fired. Plants don’t get closed over night. Expect a 40 year life minimum for a plant. Hazelwood was almost 50 when it was prematurely closed. Coal isn’t going away anytime soon.

A quick question, does anyone know whether Gore provides a disclosure statement as to which, if any, investments he has in the renewables field? It’s one thing to put one’s money where one’s mouth is but another not to disclose it when evangelizing.

Langer should tell selectors to keep Warner out

Just do it? There are two options. Aussie cricket coach Justin Langer knows a thing or two about opening batsmen. He was one of our best. Yes, if we want a better chance of winning sooner we could easily insert David Warner post his ban. However at 32 years and 64 days (154 days when the ban ends), isn’t there an argument to develop new talent for the long term? This is merely putting expedience ahead of principle.

We can argue that Warner will have served his punishment but does the team need to risk diluting its rebirth by reintroduction of a toxic force? Are we to believe Warner will return to the team as a reformed choirboy or play his hand at being the same ruffian who believes in his own mind he’s still a rightful veteran? Proof of the pudding was his trademark celebration after scoring a century in local grade cricket. He has changed not a jot.

Yes we lost the 3rd Test today but despite the woeful batting efforts in the 1st innings, Pat Cummins (who deserved man of the match) showed what grit means. 9 wickets and approaching 100 runs with the bat. We deserved to be flogged when bowled out for 151 runs but Cummins took out the top order including India’s highest scoring batters in the 1st innings for zero in the 2nd. He single handedly rallied his team to believe mentally it wasn’t over when they would have otherwise folded. He made Aussies proud.

Justin Langer has worked some miracles with the gutted side after taking the reins from Darren Lehman. Aussie team captain Tim Paine has also been impressive. Stephen Smith has none of Paine’s tenacity. Smith was made captain for being the best batsman in the world. Ability and leadership aren’t axiomatic. Smith’s weakness was evident. He allowed Warner to bully him into burying his judgement. It speaks volumes of why Smith should never captain again. His only real crime was to be a wimp.

It is also questionable whether Smith has the mental side to regain his top spot. He may well succumb to the pressure. He wouldn’t be the first gifted sports star to fall into a deep and prolonged slump post a scandal.

Warner can play 20 over big bash leagues (BBL, IPL) to earn his keep and feed his family but do we really want to send a message to kids that cheaters can prosper in our national side? His actions were disgraceful. Cheating is cheating and no rush of blood to the head is acceptable when earning millions let alone representing one’s country. It is a privilege to wear a baggy green, not a right.

CM would prefer to lose honorably than win with players who were only ever in it for themselves. Matches like today bear out how fighting as a “team” is so much more admirable. The taste of victory will be that much sweeter. No better opportunity to cast the net wide for sleeper talent who would probably have been overlooked otherwise. Make sure current players are kept on their toes to earn their spot.

It should be impressed upon incumbent players as a deterrent that cheating means life long bans. It would also be a stronger signal that the terrible governance of the farcical former Cricket Australia board is over.

Time to start afresh. Langer should take the option of keeping Warner out of the dressing room. It’s the only sensible choice.

Harley-Davidson to go into the Adventure category

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Actually credit where credit is due. Harley maybe very late to the party but realizes it must be bold to survive in the long run. Adventure (ADV) bikes (think of them as 2-wheeled SUVs)  are one of the most popular motorcycle segments now due to versatility but the competition is fierce and only getting moreso. Harley plans to launch a 1250cc ADV bike in 2020.

It is unlikely to cause segment leader BMW to quake in its boots with respect to its best seller GS series although the question is can the Harley brand can carry any sales at all? At the luxury end BMW, KTM, Ducati, Triumph, Moto Guzzi and Aprilia all have ADV bikes. BMW & KTM are the sales chart leaders. BMW for inventing the segment and KTM for strapping a 160hp nuke to its expertise in off road and 17 straight wins in the Paris-Dakar.

It is fast becoming a horsepower war. BMW is looking to launch a 145-150hp 1250cc next year for the GS from the 125hp 1170cc twin it currently has to keep up with the competition.

Without a spec sheet it is hard to tell much about the Harley ADV. It looks heavy. Weight matters. The BMW is around 240kg. The KTM 210kg. Will the Harley keep it under 260kg?

Horsepower is not a Harley strong suit. You won’t find power in a Harley spec sheet at the dealer. Will it use a clump of lazy torqued Milwaukee pig iron for an engine? In a low slung cruiser one can get away with it but in a tall ADV bike, when negotiating goat tracks (that’s a wide belly pan!), traction, power delivery and how a bike carries its weight is crucial. Can Harley produce over 120hp from this 1250cc engine with flexibility across the rev range? Will it be chain driven? Shaft? Belt? These things matter to the ADV snobs.

The design of the ADV Harley is certainly bold. CM likes it although if you drop it that headlight unit sure looks expensive to replace. Like many SUVs never see more off-road than a gravel driveway, the most dirt tracking Harley ADVs will see might be some road repairs on Route 66. The Pan America name certainly rings of highway biased use.

The next thing will be price. Even before (and after) we have full specs can Harley launch the bike at a competitive price? Harley can’t just rock up into a segment it’s never been active in and demand the type of premium it’s cruisers carry. It’s top of the line CVO series can be $50,000. BMW is considered the premium offering in ADV. Luxury Italian brand Ducati tried to price it slightly north and was caned in the sales race. KTMs are priced slightly cheaper but BMW remains king and having owned one know exactly why. The BMW is good at absolutely EVERYTHING.

Harley has history in new ventures. It broke the mold decades ago and took a stab at sports bikes with the Buell brand, but it was an abject failure. Porsche was called into help develop the V-Rod engine some 18 years ago but that is no longer sold.

Harley also aims to launch electric bikes, smaller 250-500cc categories for Asian markets and a mid range 500-1250cc for new sport type street fighters. All looks margin crushing from a distance.

From an investor perspective the accountants will require a lot of volume to justify the R&D expense. The shares closed toward the lows on the announcement.

Without getting too Harvard MBA, Harley feels extension of product is vital. To a degree it is right. Unfortunately graveyards for such strategies are too commonplace. Few get it right. Buell was case in point. BMWs K1600 Bagger will flop because it was an excuse trying to find a home for its 1600cc 6-cylinder regardless of capabilities. Customers see through this.

Harley’s ADV will have distribution channels as it’s biggest weapon. It will have a hard time converting ADV faithful unless it offers something truly better at a competitive price. Otherwise it will gather dust on showroom floors.

Personally this ADV will probably do better than most think. It won’t get close to toppling the Beemer but there are enough quirky people out there who want to be different. Nice job Harley but can it turn groups profitably around? The last 5 years have been a disaster. The question is all this product arrives at a time when the economy is likely to turn south.

Japan’s Defense White Paper 2017 – Chinese military jet incursions up 30-fold in 10 years

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Should Japan just close its eyes? The Japanese Air Self Defense Force (JASDF) has had to scramble jets almost 3x a day to intercept Chinese PLAAN aircraft flirting with Japan’s sovereign borders according to the 2017 Defense White Paper. Since 2007, the JSADF has seen an almost 30-fold jump in activity. With respect to the disputed Senkaku Islands, the PLAAN and PLAAF have been operating drones “inside” Japanese sovereign territory. While Japan can take some comfort with the US Forces stationed throughout the country, China’s increasing belligerence in the region is obvious.

With respect to China, the JMoD wrote,

China is believed to be making efforts to strengthen its asymmetrical military capabilities to prevent military activities by other countries in the region, denying access and deployment of foreign militaries to its surrounding areas (“Anti-Access/Area-Denial” [“A2/AD”] capabilities), and recently, pursuing large-scale military reforms designed to build its joint operations structure with actual combat in mind. In addition, China is rapidly expanding and intensifying its activities both in quality and quantity in the maritime and aerial domains in the region, including in the East and South China Seas.

In particular, China has continued to take assertive actions with regard to issues of conflicts of interest in the maritime domain, as exemplified by its attempts to change the status quo by coercion, and has signaled its position to realize its unilateral assertions without making any compromises. As for the seas and airspace around Japan, Chinese government ships have routinely and repeatedly intruded into Japan’s territorial waters, and China has engaged in dangerous activities that could cause unintended consequences, such as its naval vessel’s direction of fire control radar at a Japan Maritime Self-Defense Force (MSDF) destroyer, the flight of fighters abnormally close to SDF aircraft, and its announcement of establishing the “East China Sea Air Defense Identification Zone (ADIZ)” based on its own assertion, thereby infringing the freedom of overflight.

In the South China Sea, China has continued to take unilateral actions that change the status quo and heighten tension, including large-scale and rapid reclamation of multiple features, establishment of outposts there, and their use for military purposes, based on China’s unique assertions which are incompatible with the existing international order, and has made steady efforts to create a fait accompli. In addition, a Chinese fighter is alleged to have flown abnormally close to and conducted an intercept of a U.S. Forces aircraft. These Chinese activities represent serious security concerns of the region encompassing Japan, and of the international community.

For this reason, China is urged to further increase transparency regarding its military and enhance its compliance with international norms. It is a key task to further strengthen mutual understanding and trust by promoting dialogue and exchanges with China, and make further progress on measures to build trust, such as measures to avoid and prevent unintended consequences in the maritime domain.”

Sadly Japan is unlikely to get the answers it wants to hear. So as trivial as submitting to Chinese pressure to change an in flight magazine map might seem to many, the bigger picture is what is happening on the security front. As Churchill once said, “you cannot reason with a tiger when your head is in its mouth!

 

Air India seconds from disaster?

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Typical to see the press try to link the tragic accident caused by engine failure on a Southwest flight and a poorly fitted window frame on an Air India 787. The press once again went for clickbait talking about “smashed window…three rushed to hospital” instead of trying to search fact that this was a cosmetic folly and nothing more.

The main difference was in the Southwest accident, engine parts flying at 3,000rpm punctured the EXTERIOR window causing rapid decompression. In Air India’s case a poorly mounted interior window which has the functions of sound deadening and aesthetics popped out of a mount which would cause zero risk of compromising the plane’s structural integrity. If you look at the picture the oxygen masks haven’t deployed which would occur automatically if it did.

The sad truth of the Southwest uncontained failure is that the engine casing is supposed to catch any debris that breaks off. Such metal fatigue is more likely on such aircraft types (737) is that the short haul nature puts more stress on components. Such aircraft make more than half a dozen cycles (takeoff/landing) a day meaning wear and tear is higher. Tyres make a good reference- a 737 gets new tyres on average every 20 days. A long haul aircraft despite being heavier gets tyres every 40-60 days.

So typical press phooey to connect two completely unrelated accidents.

Two of the worst possible combinations one can think of

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From LivingOffset – “Global concern about climate change is growing rapidly. Five out of every 10 people now consider climate change to be a serious problem. In Chile and Peru the number is over 75%. Interestingly, 69% of Americans are concerned about global warming [if you believe HuffPost], despite their government’s position. There is no doubt demand for our offering is there, and like Airbnb, we can provide the means and the mechanism for easy participation. In just a few minutes ordinary people can start to make a real and meaningful difference.

In January 2017, IPSOS held a global poll asking what each country’s major problem was and climate change didn’t feature a mention.

As Europe and the US brave record snowfalls one couldn’t think of two more terrible combinations – a crypto-currency and a climate abatement cause. Apart from the fact that the prospectus cites Wikipedia to support its stats, it ignores the growing number of scientists admitting that climate change is little more than a multi trillion dollar rent seeking industry. As we’ve seen in recent years, many scientists and government bodies have been caught red handed with their hand in the till. Data has been manipulated to get a result. NOAA was subpoenaed by US Congress for fiddling the data ahead of the Paris Climate Accord. Australia’s Bureau of Meteorology has also been caught misrepresenting temperature records. The IPCC has made more climb downs from unchecked positions than one can count. It is the epitome of double standards given 50,000 pilgrims fly half way around the world to kneel at the altar of the COP climate change summits, belching so much of that dangerous CO2 we are warned about.

Even the language has changed – from global warming to climate change to climate disruption. All bases covered.

The one question that the alarmists can never answer – if the science is so settled, why do scientists feel so compelled to lie and corrupt data? Surely the data speaks for itself because it is so compelling on a stand alone basis. No need to brazenly commit data fraud. While many alarmists are happy to see evil banksters get hauled off to jail, have we seen any scientists face prison time for misleading the allocation of billions in taxpayer funds? Imagine if that was introduced? How quickly climate disruption would go away.

Apart from the completely bogus stats on ‘69% of Americans being concerned by global warming, SUV sales remain a solid staple in the US. In fact the most popular car in America is the Ford F-150 pick-up truck where customers rank ‘fuel economy’ #28 in terms of reasons they buy it. When Trump quit the Paris Accord, Rasmussen showed that most polled were for his move because sticking to teh deal just increased their cost burden. Wallets matter more than virtue signalling.

Let’s check reality of the climate game. 75% of the evil gas that helps plants grow are caused by 4 countries – America, China, India and Russia. Let’s tackle them one by one.

America. Well the commitment to the Accord was so flimsy to begin with, It was laced with out clauses such as being exempt from being sued for any environmental damage caused in the past or future. Obama decided to tick the box himself after lawyers breathed on the fine print – remember the US was the last to commit.

China. China, China, China. The commitment is so robust they don’t have any intention to get serious until 2030 (likely peak emissions). China has explicitly said it will raise the coal share of power to 15% by 2020 from 12% and this will keep climbing. China’s pollution problems have stuff all to do with global warming but public health however it can virtue signal under the banner of climate change mitigation and win brownie points.

India. The construction of 65 gigawatts worth of coal-burning generation is under way with an additional 178 gigawatts in the planning stages in India will mean they’ll not achieve Paris targets.

Russia’s commitment at Paris would have been more serious if drafted on a hotel napkin such was its lack of substance. 4 pages of nothing.

LivingOffset makes some grandiose claims of 128% returns by 2022 but put in its disclaimer,

There can be no assurance that LivingOffset’s investment objective will be achieved and investment results may vary substantially over time. Investment in LivingOffset is not intended to be a complete investment program for any investor. Prospective participants should carefully consider whether an investment is suitable for them in light of their circumstances and nancial resources.

Carbon offsets are a joke. In Australia, people can elect to have their electricity sourced from renewables only (by paying a premium) yet less than 3% choose to do so. Qantas offered carbon offsets when flying but the take up has been insignificant. Carbon offset calculators are so woefully inaccurate that the price paid to virtue signal can be drastically affected by load factors, aircraft type, head/tailwinds and delays to land.

In any event there are 190 odd currencies in the world and over 1,000 crypto currencies. Apart from the unregulated nature of these electronic coins, we’ve already seen how vulnerable ‘blockchain technology’ is and how easy it is to be hacked. Crypto is backed by greed. Recently a person was emptied of all their crypto at phone point. Once the transaction has been completed the ‘money’ is gone. So no need to break into a bank. Just rob you from your smartphone.

While the crypto currency trend continues, await harder nosed regulations, taxation and  restrictions that take the lustre off these coins. LivingOffset looks a very risky investment.  To some up LivingOffset – it is like asking someone else to quit smoking on your behalf. How do you benefit health wise?

Then again actions always speak louder than words. Aircraft travel is set double by 2035 according to IATA. Last time I looked, aircraft run on fossil fuels. Once again, peoples’s consumption habits are the best indicator of commitment to climate abatement.