Sunday, July 27, 2014

Droughts in California and other Regions

  • Last week, the California Department of Water Resources reported that water levels at 10 of the state's 12 major reservoirs had dropped below 50% of their total capacity, with several nearing the 20% level.  According to the National Oceanic and Atmospheric Administration. 80% of California is in a state of either an Exceptional or Extreme drought level, with 18% at Severe level. In addition, the recently released study Economic Analysis of the 2014 Drought for California Agriculture said “California is enduring its third driest year on record as agricultural, urban and environmental demands for water are at an all-time high” and “the total statewide economic cost of the 2014 drought is $2.2 billion, with a total loss of 17,100 seasonal and part-time jobs.” 
  • Across the contiguous U.S, 31% of the country is in a moderate to extreme level of drought. Globally, Asia drought has intensified on the Indian sub-continent, in north-central Russia, in Japan, and in the Middle East.  In Africa, drought has increased in equatorial AfricaMadagascar and South Africa. In South America, drought persists around the equator and in areas of Brazil. In Australia, it is spreading to cover more of the East.  
  • Unlike hurricanestornados and earthquakes, drought is a natural disaster that evolves over an extended period of time.  While they generate fewer new headlines, a drought's social, economic and environmental impact can affect a region for years.
  • Unless conditions improve in California and elsewhere, conflicts may increase between those seeking water uses for swimming pools; fountains, golf courses and lawn care and those seeking to grow agricultural crops and raise livestock.  
  • As some communities consider ways to reduce unnecessary water use, a nice green lawn may become a sign that you are part of the problem, rather than part of the solution.
  • Conservation is important!

Sunday, July 6, 2014

Clinton, Blair and Santos at the ”Third Way” Summit in Cartagena, Colombia

Last week, former U.S. President Bill Clinton and former British Prime Minister Tony Blair attended the”Third Way” summit in Cartagena, Colombia.  President Juan Manuel Santos focused on his peace efforts with the Marxist Revolutionary Armed Forces of Colombia (FARC) rebels. Clinton said "you will never get to the final reconciliation of your country if you don't finish this peace process" and "there will always be specific things that you would still have to work out over the years ahead.”  Blair said peace "means genuinely giving up on violence and a genuine embracing of peace" Note: Interpretations of what the “Third Way” is vary. Santos's view is that the “extreme center” is better than leaning to the left or the right.


Colombia has experienced significant economic growth in recent years, but unresolved issues with the FARC remain an on-going challenge.  Santos was recently re-elected to a second term as President but his popularity is not broad based.  His “Third Way” aspirations will likely require significant work and compromise.  Note: unresolved issues with the FARC include 1) the surrender of weapons, 2) compensation for victims and 3) how a final agreement would be ratified.

Bitcoin and Alternative Currencies in California

  • California Governor Jerry Brown signed the California Alternative Currencies Act which removes outdated laws, in place since 1849, which barred payment systems including digital currencies such as bitcoin, reward point systems such as airline frequent flyer milesAmazon Coins and Starbucks Stars and  community currencies such as Davis Dollars and Bernal Bucks.  The bill’s sponsor Assemblyman Roger Dickinson said ”this bill is intended to fine-tune current law to address Californians' payment habits in the mobile and digital fields.”
  • Also, venture capitalist Tim Draper was the high bidder in U.S. Marshals Service’s auction for 30,000 bitcoins that were seized from on-line service Silk Road.  Draper said the Bitcoins will be used to support the efforts of exchange provider Vaurum, who’s investors include Draper, Steve Case (founder of AOL)Battery VenturesCrosslink Capital and RRE VenturesNote: the government is still in possession of 144,000 bitcoins which will be auctioned at a later date.
  • Regarding Bitcoins in California -   The removal of outdated laws by Brown and the California legislature acknowledges 1) the value of alternative currencies currently in use and 2) the potential for future innovation.
  • Regarding Draper’s purchase – It is another example of a high profile investor putting his money to work to support the early stage development of  the digital currency market.