Wry & Dry

A well-stacked Victoria... Europe becalmed. Sub secrets.

When the cat's away...

Wry & Dry returns from a week without his quill in hand to find his letterbox overflowing with items...

In Glasgow, the streets are being cleaned for the bizarrely named COP26 [1], the world's most notable hot air fest since the Montgolfier brothers in 1783 [2]. PM Jimmy Morrison remains precariously balanced on the beam of Net Zero indecision, tugged by marginal seats in Queensland on one side and marginal seats everywhere else on the other.  

Cartoon morrison coal china

In Victoria, Chairman Dan's poll-driven epiphany (i.e. private polling by his operatives showed that Melbournians were not happy about being the most locked-down city in the world and so Dan suddenly decided that zero-covid Victoria was not viable) means that he is now counting double-vaxxed Victorians instead of covid cases. 

In Moscow, Tsar Vlad's smile gets wider as Russia's control of gas supplies to Europe helps force up domestic gas prices from Scotland to Greece. He waits for Europe to come begging. Why bring out the tanks? 

In New South Wales, one non-British-heritaged premier (Gladys: Armenia) was succeeded by another (Dominic: France). The latter has promised land tax reform. But tax reform is in the eye of the beholder. A tax loophole is something that benefits the other guy. Tax reform is something that benefits you.

In the USA, inflation hit 5.4%. An increase in US interest rates and its consequences will crimp Sleepy Joe's party's mid-term election chances (November 2022). The Trumpster is counting the sleeps.   

In Victoria, a corruption commission enquiry has commenced into Chairman Dan's party's use of taxpayer funds to finance 'branch stacking'. Chairman Dan has already pleaded the Sergeant Shultz defence [3]. 

Cartoon branch stacking

[1] The 26th United Nations' Climate Change Conference.
[2] Inventors of the hot air balloon.
[3] "I know nothing."

A well-stacked Victoria

"Branch stacking" has hit the headlines in the Peoples' Republic of Danland. Some Readers may consider that branch stacking is a part of a fire-lighting exercise, immediately preceding a lighted match being applied to the stacked branches. There is little doubt that the branch stacking going on in Chairman Dan's party may eventually result in a lighted match being delicately applied to the nether regions of some stacking participants. 

However, branch stacking is actually an inflammatory exercise of a different species. It is the dastardly practice of artificially, mischievously or illegally increasing the number of members in a branch of a political party so as to increase that branch's influence. 

A member of the Liberal Party would consider branch stacking to be beneath his/ her dignity. And if attempted would be clumsy, amateurish and almost certainly fail. "Bad luck, chaps! I'll see you at the Club for lunch."

A member of the Labor Party would consider successful branch stacking to be a badge of honour, it being a full time, remunerated and high artform. It would guarantee an influential job for life. "Listen, mate. This is how you will vote." 

A member of the National Party wouldn't understand branch stacking. Success is not measured by the number of branch members, but by the bribes that can be extracted from PM Jimmy Morrison. "Tap the keg! We got the billion for the dam!"

A member of Clive Palmer's UAP wouldn't know about branch stacking as branches don't exist. Even if they did, it's Clive's way or the highway. Craig Kelly, its Quisling parliamentary leader, tenders obeisance to the well-upholstered Clive. "Covid is a hoax. Vaccinations are unconstitutional. And God Save the Queen."

A member of the Greens would consider branch stacking to be environmentally unsound. "That tree should not have been chopped-down in the first place."  

Cartoon green branches

Europe becalmed

There is a certain beauty about a wind turbine lazily revolving in a summer's breeze. Not to mention the bonus of a mass of excited electrons charging down the wires [4] to power up all those Teslas.

But a stationary turbine is ugly. And a problem. So there are problems all across Europe, where over 60,000 wind turbines are getting cobwebs in the windless weather. These are supposed to provide about 18% of their country's power but are currently pumping out about 2%. 

Cartoon windmills

Hence the ballooning price of gas. As Wry & Dry has pointed out, in the UK that's a 500% increase in prices over the past 12 months. 

Wry & Dry's point is actually not about gas prices, but the unhappy timing of the COP26 - to be held for two weeks from 31 October in Glasgow. Gas prices up fivefold because of the failure of renewables [5] might cause egg-on-face. Renewable energy supply fluctuations are reality.  And the massive price consequences of renewable energy to both the consumer and industry are also reality.  But Wry & Dry suggests that COP26 will ignore this reality.

Readers will know that there are two other realities.

Firstly, COP26 itself will be a wasteful talk-fest. Country leader after country leader will mount the podium to solemnly announce their country's fealty to Net Zero by 2050. Each knowing that their country will probably have at least four changes of government between now and then (Tsar Vlad, Emperor Xi and Sultan Erdogan excepted), so, well, what the heck, we'll agree. And each knowing that they have no way of knowing how much it all will cost.  

Secondly, 56% of the world's carbon emissions come from four countries (China 30%, US 14%, India 7%, Russia 5%). All the talking by the 196 other countries and assorted publicity seeking, virtue signalling celebrities is not worth a pile of beans unless these four get their act together. Notwithstanding all of the local bleating, Australia is not even close to being in the main game. Perhaps the Magoos [6] in a country competition.

Surely better to lock up the four into a room until they work it all out. And save all the dosh wasted on COP26 (air travel, accommodation, restaurants, food, facilities, etc.). And Readers wouldn't have to see newsreels of Croesus Turnbull chasing down every photo opportunity with other RDS'd hazbeens or coodabeens.

[4] Actually, it doesn't work like that.  But Fridays are better without the arcane details of electricity transmission.
[5] And Tsar Vlad. 
[6] Rhyming slang: The "Magoos" means the "Twos", i.e. the second best level of a competition.  Mr Magoo was a fictional cartoon character, voiced by Jim Backus.

Biden gets his wind up

The USA currently has about 120 gigawatts of installed wind power capacity [7]. And Sleepy Joe promised to build 30 gigawatts of offshore wind power by 2030. Nine years to go. So, what's the plan?  

Well, on Wednesday his administration announced that it would encourage development of large-scale wind farms along the entire coastline of the USA. The plan is to "identify, 'demarcate' and lease federal waters" to wind power developers.

Err, hold the phone. Small problem: bureaucracy. There will need to be federal, state and local approvals; consideration given to environmental issues, military activity and local industry (e.g. tourism). Not to mention bloody mindedness of both politicians and the average American Joe (not Biden) - Americans are proud of their "constitooshunal rarts". And have a willingness to lawyer up at the drop of a Stetson.

Wry & Dry predicts two chances of Sleepy Joe's 30 gigawatt promise working. And his promise, if met, is enough to power 10 million homes, the big announcement said. There are 139 million homes in the US.  

Assuming the current capacity is used for industry, there are only 129 million homes to go.

[7] China leads the table with 282 GW of installed wind power, then Europe with 205, Germany 62, India 38, Spain 27, UK 24. Australia is ranked 11th, with about 10GW. 

Sub secrets

Readers may have noticed that an American couple has been arrested by the FBI for attempting to pass on secrets of America's nuclear submarines to 'an unnamed foreign power'.

Wry & Dry's man person in Washington can exclusively reveal that the 'foreign power' is France. The French want to build submarines that duplicate the ones that Australia will be getting. And so show the world it can so do in less than the 20 years it will take for the Australian navy's Ikea assembly shipyard in Adelaide.    

Global tax

"Think global!" has been the cry from certain noisy cohorts for many years. Well, now the worst has happened: tax is now global.

The finance ministers (i.e. treasurers) of 136 countries have agreed a minimum 15% tax rate for companies, no matter in which of those 136 countries each operate. The deal is not only aimed at the usual multinational tech companies (e.g. Amazon, Apple), which divert profits to low taxation jurisdictions (Ireland being favoured), but also to lesser known entities the names of which are well hidden from the gaze of the public.

Cartoon Bezos

 

Of course, there remains many obstacles, not least of which is the US Senate. Under the US constitution, all 'treaties' must be ratified by the Senate - a massive stumbling block.

Critically, Kenya, Nigeria, Pakistan, and Sri Lanka haven’t signed the deal.

Reform at last?

Whilst Wry & Dry was spending a week at the boot of Mrs. Wry & Dry, a new premier emerged in New South Wales. Dominic Perrottet (the name has French heritage) succeeded Gladys Berejiklian (Armenian heritage).  

Mr. Perrottet is clearly a man who is his own man. If for no other reason than when state treasurer he proposed the abolition of property transfer stamp duty and replacing it with land tax. But reforming tax is going to be a touch more difficult than declaring covid-freedom day.

cartoon nsw free

Wry & Dry hopes that this reformist streak will not drown in the sordid cocktail of politics and lobbying from property developers. 

Stamp duty is odious and most inefficient. Readers will know that it places the primary onus for the funding of state education, hospitals and other services on those who just happen to be moving house.  Those who choose to stay in their homes make no contribution whatsoever to the state's general coffers.

Moreover, stamp duty inhibits residential mobility and property transactional efficiency.

The problem is, of course, with what to replace it. A form of land tax was mooted by Mr Perrottet.

Wry & Dry will look with interest at Mr. Perrottet's reforming zeal - now that he is in the top job. The last premier with a reformist zeal and effectiveness was Victoria's Jeff Kennett.   

Emperor's change of heart

What's going on? Recently, Emperor Xi has made it clear that China will militarily force the takeover of Taiwan if it could not be achieved peacefully.

This week he said that "reunification with Taiwan should be achieved by peaceful means."

Cartoon doldrums

Why the change of heart, if not mind?

a.  this is just a continuation of Beijing's games. And that in a little while, the Emperor will again be rattling his sabre;

b.  Beijing will revert to the implicit understanding between China and Taiwan, whereby each says nothing about 'reunification' and neither does anything;

c.  this is a translation error.  Emperor Xi meant to say "reunification with North Korea, Mongolia, Cambodia, Vietnam, Laos and Afghanistan should be achieved by peaceful means;" or   

d.  this is a pre-Winter Olympics goodwill offensive.

Close. But no cigar. The correct answer is d. Emperor Xi is acutely aware of global public relations. The world and his subjects must see China as peace loving. And what better forum than at events surrounding and at the Olympic games? Weirdly, the 2022 Winter Olympics are being held in Beijing and towns in neighbouring Hebei province. Beijing will be the first city to host both summer (2008) and winter games.    

US inflation: transitory or persistent?

The US CPI increase of 5.4% for the year to end of September is a big number. No, it's massive. What's going on?

Chart US inflation

The doves are saying that the increase is transitory, as the US moves out of the covid induced economic slowdown.

The hawks are saying nuh, get real. Low interest rates, an indulgent Fed (the so-called quantitative easing) and a spendthrift US government are pushing up demand. And supply constraints (seriously affecting energy, food and chip [8] prices) will ensure that this will be persistent.

Wry & Dry falls into the latter school.

And the outcome: the Fed will 'taper' its asset purchase programme. And then move to increase official interest rates next year.

As one commentator put it, usually the Fed takes away the punchbowl before the party gets out of hand. Now it's going to wait until everyone is well and truly plastered before acting.  

Readers should be careful.

[8] That is microchips, not crisps or fried chipped potatoes.  

Français 

Readers will know that the EU operates with three main languages: German, French and English. And 21 others [9]. Most meetings are undertaken in English, being the most widely spoken language in the EU.

However, with Brexit, and perhaps other events, the French government is now seeking to exclude English. It says that there are just two small countries left that speak English: Ireland and Malta.

Wry & Dry suggests to the French that English should remain as the lingua franca of the EU. If for no other reason than it was English speaking nations that ensured that the French now don't speak German.  

[9]Bulgarian, Croatian, Czech, Danish, Dutch, Estonian, Finnish, Greek, Hungarian, Irish, Italian, Latvian, Lithuanian, Maltese, Polish, Portuguese, Romanian, Slovak, Slovenian, Spanish and Swedish.

Snippets from all over 

1. AAA

Fitch Ratings affirmed Australia's AAA credit rating and upgraded its outlook from negative to stable.

Wry & Dry comments: But one swallow doesn't a summer make.

2. Eurozone fall

Industrial output in the eurozone fell back below pre-pandemic levels in August as supply chain bottlenecks restricted production of many products. 

Wry & Dry comments: This might be just about cars and microchips. The automotive sector is bearing the brunt of the global semiconductor shortage, with car manufacturers sitting on a large stock of semi-finished vehicles waiting for components.

3. Unemployment up

Australia's unemployment rate ticked up slightly to 4.6% in September.

Wry & Dry comments: The rate could have been much higher because of the lockdowns. 

4. UK fertility flops

The UK's fertility rate has fallen to its lowest level since records began in 1938, government figures have revealed, with an average rate of 1.5 children per woman.

Wry & Dry comments: Clearly, British men are not up to the task. A fertility rate of 2.1 is needed for population stability. The UK will have to rely on immigration to make up the gap. And then some.

5. China property slide

China Real Estate Information Corp says that more than 90% of China’s top 100 property developers’ sales declined in September by an average of 36% year-on-year.

Wry & Dry comments: Another canary in the coal mine? 

And, to soothe your troubled mind...

Last words...

"Our Elections are so corrupt and nobody wants to do anything about it."

 - Donald Trump. former President of the USA, in a shortened version of a media release tantrum, after a Georgia judge rejected a bid by Trump supporters to undertake yet another audit of 2020 presidential ballots.  

Where are those men in white coats?

PS A reminder that the opinions in Wry & Dry do not necessarily represent those of First Samuel, its employees or directors.

 

Cheers

Anthony