Roundup: October 2

Markets

The SEC has extended the ban on short-selling of financial stocks, pending the passage of the current bailout legislation. Last night the Senate passed the bill, 75-24, which now goes back to the House of Representatives. Three cheers for the holdouts: like Congresswoman Carolyn Kilpatrick (D-MI, 202-225-2261), who chairs the Congressional Black Caucus and (so far) is resisting incredible pressure to vote for the bill in its current form. On the upside, the renewable energy tax credits have been bundled into the bailout bill.

The Council on Foreign Relations has written an introduction to the US financial regulatory system -- highly recommended for anyone confused about the differences between the various entities with oversight of the financial system. And the NYT publishes a blow-by-blow history of the major players' actions in the last two weeks of the crisis -- a must-read.

Across the Curve reports on stress in the money markets -- 3-month Libor rose again to 4.21%, with the Libor-OIS spread at record highs (261bp); overnight libor fell 111bp to 2.68% -- and says the Presidential candidates should reveal their top picks for Treasury Secretary in advance of the election. Hear, hear.

The ECB held rates at 4.25%; but Trichet has reversed himself and says the ECB is considering rate cuts in the near future -- the Euro tumbled on the news.

Buiter says the Irish bailout scheme violates EU law, is calculated to poach sterling deposits from UK banks, and is shortsighted. Ireland said today it would have preferred a European solution but couldn't afford not to act.

Russia's bailout of its banking sector has supported larger banks like Sherbank, but it may not prevent the failure of many of the nation's smaller banks, which may be bought up by the larger players.

US initial jobless claims today came in at 497k, bringing the 4 week rolling average to 474k. The US national debt, ex the pending bailout plan, now stands at over $10tr. September US auto sales hit a 16-year low. The Fed may have to mark as much as $6bn down on the $30bn portfolio of Bear Stearns assets now being run for the taxpayer by BlackRock. The FDIC has lifted a 2006 consent order on Mitsubishi UFJ -- tit-for-tat.

The NYT will publish anyone. The Epicurean Dealmaker has an incisive takedown of alarmism over the urgency of the bailout bill.


World

The IHT discusses the risks posed to Pakistan's new, democratically-elected government by continued US violations of its sovereignty along the Afghan border. The collapse of Pakistan's government would be far more damaging to the war in Afghanistan than would negotiations over joint operations in the crucial areas. The Bush Administration once again risks, through ignorance of the domestic situation in other countries and disrespect for sovereignty, destroying all hopes of success in a crucial zone of conflict.

Early typhoons hitting Vietnam have cost at least 40 lives and may have devastated the rice harvest. The country is already dealing with ~40% price inflation, driven largely by increases in the price of rice worldwide.

Half of Zimbabwe's population may require food aid and medical supplies from the UN to prevent widespread famine and disease. Inflation in Zimbabwe has reached 531bn%. That's 500,000,000,000% annually.

EU monitors began patrols in South Ossetia and Georgia as part of the cease-fire agreement.

The Senate formally approved the nuclear cooperation treaty between India and the United States.

This is a very good primer on the proposed South American Defense Council, a regional organization that may model itself as the NATO of South America.

The end of Ramadan saw renewed violence in Iraq.


Science

The U.S. has followed in the footsteps of the EU by banning the export of mercury. These two pieces of legislation will drastically curtail the leakage of mercury in the developing and developed world into water supplies, fish, and the oceans.

Fool's Mountain looks at citizens' demands for extensions of the air quality controls in Beijing after the Olympic experience demonstrated the value of clean air.

Google has published a $4tr clean energy plan for the US to cut CO2 emissions by 95% by 2030.

The world's largest solar thermal power plant will start using its molten-salt storage facility to generate electricity in the dark. This facility can increase the power supplied by the plant by 50% annually.

Waste Management has launched a major program to develop as much as 1GW of landfill gas-to-electricity conversion plants on its sites. These plants cut CO2e emissions from landfills by as much as 90% or more.

U.S. passenger-miles driven fell YoY for the ninth straight month in July, in the face of high gasoline prices and the recession.

Nature publishes an article that concludes HIV has infected humans since at least 1910. It suggests the lack of urban centers in Central Africa contributed to the delay in the start of the epidemic.

Cost overruns for plans to outfit key U.S. cities with detector systems for nuclear weapons threaten to climb into the billions, with the agency in charge apparently failing to follow standard procedures for cost estimation. Seven years after September 11, the situation is worrisome.

Do our perceptions of cleanliness -- inherited from another era of technological development and ecological pressures -- stand in the way of the most straightforward answers to water shortages?