Webdiary - Founded and Inspired by Margo Kingston

"The perception that coal is the fossil fuel of last resort may well be an illusion." Energy Watch. Professor David Rutledge of CalTech in a lecture last October, suggests that world coal reserves are grossly overstated and could be substantially exhausted this century.

Not much has been written, in fact nothing at all, about the geopolitical significance of that controversial New Year cricket match at the SCG. Yes, geopolitical. It was about the emergence of India as the next economic super power and manifesting itself as a cricket super power as well. This is the elephant in the room that everyone is still not seeing.

One of the insights of behavioural economics - which is the study of the way people actually think about economic issues, not the way they should think - is that, unlike economists, most people don't add pluses and minuses together to get a net result. (Ross Gittins)

Future historians will look back on the current decade as a turning point comparable with that of the Seventies. No, not the 1970s. This is not going to be another piece pointing out the coincidence of an unpopular Republican president, soaring oil prices, a sagging dollar and an unwinnable faraway war. I am talking about the 1870s. (Niall Ferguson)

Webdiary has been banging on about the dangers of peak oil for years now, largely due to the efforts of Ian McPherson, who went on to found Sydneypeakoil. The problem of quickly diminishing oil supply has been known about for decades, and was one of the reasons Dick Cheney wanted to invade Iraq. But Australian governments have buried their heads in the sand, to the medium and short term detriment of their citizens. Yesterday, the Queensland Government issued a report on peak oil, after lots of good work behind the scenes by activists.

"In the 80s, my wife and I, together with our daughter, went to China to work. We particularly like Beijing. We like the atmosphere of Beijing, her people and her culture. Twenty years later, my little daughter has now married an Australian Chinese. My son is also now enrolled to study at the Fudan University in Shanghai. My youngest son, who is still in junior high school, usually he is rather naughty and does not like to do home work, but recently he has also started to learn the Chinese language." Rudd to Hu

Anybody who believes exponential growth can go on forever in a finite world is either a madman or an economist (Kenneth Boulding).

It seems incongruous that constant warnings about the terrorist threat should lead to APEC staging itself in the very place most likely to be a magnet for such acts. However, APEC has good reason for not meeting on some tropical island. Far from seeking to avoid the week long APEC chaos diary, the event seems to have a fetish with securing these set pieces. As I shall argue here, APEC serves the cause of military urbanism.

The watchdog organisation Aidwatch has released a report today which found that Australian aid money has been used in Iraq to rework the country to suit international corporations. Our Foreign Minister's response was to brand Aidwatch an extremist organisation.

Call me naive, but I’m hoping Barack Obama becomes the fourty-fourth American president. He’s no political saviour, but he could point us in a better direction.

It is tempting to lay the blame on Howard and his government for what has been done in our name but, at the end of the day, it is the Australian public with whom much of the fault lies. We have been gullible and self-absorbed. As a nation, we do not really take the threat of global warming seriously. The disengagement by the public at large has allowed our politicians of both major political persuasions to give our big polluters a free ride.

On Webdiary we've gone round the the Peak Oil loop more than a few times over the last few years (eg here). A new point of interest has arisen over this week: for the first time in the last few years the oil futures price has come out of its persistent state of contango as it rose back over USD75. What does this mean? Well, the short answer is, for the first time in a long while, oil futures dealers are not on balance convinced that the next move in the oil price is necessarily up.

"Over time, the scientific evidence that the climate is warming has become quite compelling and the link between emissions of greenhouse gases from human activity and higher temperatures is also convincing. Australia has long been an active player in the search for an efficient, effective and equitable solution to climate change." John Howard

Hello.  I've been off line for five days traveling with a friend from the South visiting her friends and mine and chilling out. Thank you, thank you to Fiona, Richard and David for keeping comments ticking along. I hope everyone is content at how Webdiary is traveling but if not, let me know in the comments box.

Leaders of the European Union gathered in Berlin this weekend for a grand birthday feast celebrating half a century of European integration. To mark the occasion, they have revealed The Berlin Declaration.

Paul Krugman recently delivered the keynote speech at the Economic Policy Institute's second Agenda for Shared Prosperity event. Webdiarist Peter Hindrup recommends we read this interesting speech and open a conversation about it as "apart from anything else it might just shake some of regulars from their entrenched positions and create a real debate."

From the end of February 2007, Webdiary will no longer be publishing articles sourced from Project Syndicate, including those from J Bradford DeLong. Subsequent articles in Professor DeLong's Anatomy of the Global Economy series can be accessed via the Project Syndicate site here.

A number of thoughtful observers have expressed puzzlement in recent months about financial markets’ perceptions of risk. While markets have judged today’s world  – especially the dollar and securities linked to it – to have low risk when viewed in historical perspective, geopolitical risks in fact appear to be large.

Over the last few years, my input to any discussions on "how would we know if this feared big crash is on us" was "when the Dow falls more than 300 in one day". Soon we'll know if I was right.

From the end of February 2007, Webdiary will no longer be publishing articles sourced from Project Syndicate, including those from Joseph E Stiglitz. Subsequent articles in Professor Stiglitz's I Dissent: Unconventional Economic Wisdom series can be accessed via the Project Syndicate site here.

From the end of February 2007, Webdiary will no longer be publishing articles sourced from Project Syndicate, including those from Jeffrey Sachs. Subsequent articles in Professor Sach's Economics and Justice series can be accessed via the Project Syndicate site here.

From the end of February 2007, Webdiary will no longer be publishing articles sourced from Project Syndicate, including those from Kenneth Rogoff. Subsequent articles in Professor Rogoff's The Unbound Economy series can be accessed via the Project Syndicate site here.

"Rural protectionism in rich countries seems to have killed the Doha Round – and, with it, potentially the whole multilateral trading regime.": Malcolm Cook, Lowy Institute

What is at stake is not protecting domestic producers, but protecting our planet. The changing climate on climate change provides political leaders in Europe and other potential members of this “coalition of the willing” an unprecedented opportunity to move beyond mere rhetoric. The time to act is now.

Many people have been asking why the dollar hasn’t crashed yet. Will the United States ever face a bill for the string of massive trade deficits that it has been running for more than a decade?

How much should we worry about inequality? Answering that question requires that we first answer another question: "Compared to what?" What is the alternative against which to judge the degree of inequality that we see?

"What China needs most is a financial sector capable of harnessing the forces of liberalization and globalization to drive economic growth in the decades ahead. The time has come to cast off the burden of building financial centers, and focus instead on advancing the modernization of Chinese finance.": Zhang Jun

The scenario has become painfully familiar. A war ends. An international donors’ conference is called. Pledges of billions of dollars are announced. But actual reconstruction and recovery is delayed, perhaps for years. Crony businesses from the US and Europe, which are utterly unfamiliar with local conditions, squander time, aid funds, and opportunities. Recriminations fly, the occupying army remains, and a new insurgency spreads.

"Given all the effort that the world’s "emerging markets" have devoted to shielding themselves from financial volatility, they have reason to ask: where in the world is the upside of financial liberalization? That is a question all of us should consider.": Dani Rodrik

"If a major flare-up causes investors to lose confidence in low volatility, the bottom could fall out from under equity and housing prices. In that case, do investors and policymakers have a plan B?": Kenneth Rogoff