Category Archives: Russian economy

Chinese economy, climate change, global business forecasts, global warming, new business formation, predicting epidemics, Russian economy

Links, end of September

Information Technology (IT)

This is how the “Shell Shock” bug imperils the whole internet

It’s a hacker’s wet dream: a software bug discovered in the practically ubiquitous computer program known as “Bash” makes hundreds of millions of computers susceptible to hijacking. The impact of this bug is likely to be higher than that of the Heartbleed bug, which was exposed in April. The National Vulnerability Database, a US government system which tracks information security flaws, gave the bug the maximum score for “Impact” and “Exploitability,” and rated it as simple to exploit.

The bug, which has been labeled “Shell Shock” by security experts, affects computers running Unix-based operating systems like Mac OS X and Linux. That means most of the internet: according to a September survey conducted by Netcraft, a British internet services company, just 13% of the busiest one million websites use Microsoft web servers. Almost everyone else likely serves their website via a Unix operating system that probably uses Bash.

Microsoft’s Bing Predicts correctly forecasted the Scottish Independence Referendum vote

Bing Predicts was beta tested in the UK for this referendum. The prediction engine uses machine-learning models to analyse and detect patterns from a range of big data sources such as the web and social activity in order to make accurate predictions about the outcome of events.

Bing got the yes/no vote right, but missed the size of the vote to stay united with England, Wales, and Northern Ireland.

Is the profession of science broken (a possible cause of the great stagnation)? Fascinating discussion which mirrors many friends’ comments that too much time is taken up applying for and administering grants, and not enough time is left for the actual research, for unconventional ideas.

What has changed is the bureaucratic culture. The increasing interpenetration of government, university, and private firms has led everyone to adopt the language, sensibilities, and organizational forms that originated in the corporate world. Although this might have helped in creating marketable products, since that is what corporate bureaucracies are designed to do, in terms of fostering original research, the results have been catastrophic.

Climate

Climate Science Is Not Settled The Wall Street Journal piece by a former Obama adviser and BP scientist inflamed the commentariat, after publication September 16, on the eve of the big climate talks and march in New York City. See On eve of climate march, Wall Street Journal publishes call to wait and do nothing for a critical perspective.

This chart, from NOAA, is one key – showing the divergence in heat stored in various layers of the oceans –

oceanheat

Nicholas Stern: The state of the climate — and what we might do about it TED talk.

Ebola

The public response to the Ebola epidemic is ramping up, but the situation is still dire and total cases and deaths are still increasing exponentially.

Ebola outbreak: Death toll passes 3,000 as WHO warns numbers are ‘vastly underestimated’

“The Ebola epidemic ravaging parts of West Africa is the most severe acute public health emergency seen in modern times.Never before in recorded history has a biosafety level four pathogen infected so many people so quickly, over such a broad geographical area, for so long.”

 ebolamap 

Global Economy

What Does a ‘Good’ Chinese Adjustment Look Like? Michael Pettis argues that what some see as a “soft landing” is in fact a preparation for later financial collapse. Instead, based on an intricate argument regarding interest rates and the nominal GDP growth rates in China, he proposes a reduction in Chinese GDP growth going forward through control of credit – in order to rebalance the Chinese consumer economy. Pettis is to my way of thinking always relevant, and often brilliant in the way he makes his analysis.

What Went Wrong? Russia Sanctions, EU, and the Way Out

Washington, Brussels and Moscow are in a vicious circle, which would spare none of them and which has potential to undermine global recovery.

Venture Capital

22 Crowdfunding Sites (and How To Choose Yours!)

inc-magazine-crowdfunding-infographic-june-2013_26652

accuracy of forecasts, bias in forecasts, energy forecasting, global business forecasts, Russian economy, technology forecasting

Energy Forecasts – the Controversy

Here’s a forecasting controversy that has analysts in the Kremlin, Beijing, Venezuela, and certainly in the US environmental community taking note.

May 21st, Reuters ran a story UPDATE 2-U.S. EIA cuts recoverable Monterey shale oil estimate by 96 pct from 15.4 billion to 600 million barrels.

Monterey

The next day the Guardian took up the thread with Write-down of two-thirds of US shale oil explodes fracking myth. This article took a hammer to findings of a USC March 2013 study which claimed huge economic benefits for California pursuing advanced extraction technologies in the Monterey Formation (The Monterey Shale & California’s Economic Future).

But wait. Every year the US Energy Information Agency (EIA) releases its Annual Energy Outlook about this time of the year.

Strangely, the just-released Annual Energy Outlook 2014 With Projections to 2014 do not show any cutback in shale oil production projections.

Quite the contrary –

The downgrade [did] not impact near term production in the Monterey, estimates of which have increased to 57,000 barrels per day on average between 2010 and 2040.. Last year’s estimate for 2010 to 2040 was 14,000 barrels per day.

The head of the EIA, Adam Sieminski, in emails with industry sources, emphasizes Technically Recoverable Reserves (TRR) are not (somehow) not linked with estimates of actual production.

At the same time, some claim the boom is actually a bubble.

What’s the bottom line here?

It’s going to take a deep dive into documents. The 2014 Energy Outlook is 269 pages long, and it’s probably necessary to dig into several years reports. I’m hoping someone has done this. But I want to followup on this story.

How did the Monterey Formation reserve estimates get so overblown? How can taking such a huge volume of reserves out of the immediate future not affect production estimates for the next decade or two? What is the typical accuracy of the EIA energy projections anyway?

According to the EIA, the US will briefly – for a decade or two – be energy independent, because of shale oil and other nonstandard fossil fuel sources. This looms even larger with geopolitical developments in Crimea, the Ukraine, Europe’s dependence on Russian natural gas supplies, and the recently concluded agreements between Russia and China.

It’s a great example of how politics can enter into forecasting, or vice versa.

Coming Attractions

While shale/fracking and the global geopolitics of natural gas are hot stories, there is a lot more to the topic of energy forecasting.

Electric power planning is a rich source of challenges for forecasting – from short term load forecasts identifying seasonal patterns of usage. Real innovation can be found here.

And what about peak oil? Was that just another temporary delusion in the energy futures discussion?

I hope to put up posts on these sorts of questions in coming days.

energy forecasting, geopolitical risk, Russian economy

Russia and Energy – Some Geopolitics

A couple of charts highlight the dominant position Russia holds with respect to energy, and, specifically, specifically, natural gas production.

First, there is this trade graphic from the BP Statistical Review of World Energy 2013.

naturalgastrades

Clearly, Russia has dominant global position in natural gas trades.

The Europeans are primary consumers for Russian natural gas, and there are some significant dependencies, as this graphic shows.

Ukrainegas

So Russia’s position as a major energy supplier no doubt is operating as a constraint on sanctions for the annexation of Crimea.

On the other  hand, this is a mutual dependency. The US Energy Information Agency, for example, reports that oil and gas revenues accounted for 52% of federal budget revenues and over 70% of total exports in 2012.