Daily Archives: March 11, 2012
Israel will only strike Iranian nuclear facilities in September or after the United States presidential elections in November, a White House official told the British Sunday Times newspaper after a meeting between Prime Minister Benjamin Netanyahu and US President Barack Obama last week.
According to the report, Obama has taken Israel’s warnings about a possible strike in Iran very seriously. The Washington source added that the president “might visit in the summer to reassure the Israelis that the US commitment to defend Israel is unshakable and thus thwart a possible autumn attack.”
Obama insisted that any attack on Iran should be postponed until after the US presidential elections in November, possibly even until next spring. The source revealed that Netanyahu consented to delaying a strike, but wished to know until when. “The question is how much time,” he reportedly said.
The White House source added that Netanyahu presented a number of demands Iran must fulfill in order to avoid an Israeli attack, including transferring 150 kilograms (330 pounds) of enriched uranium to a third party, stopping the enrichment process at the Fordow site near Qom and ceasing any further enrichment beyond the 3.5% required for power generation.
The source reported that Israel’s National Security Advisor Yaakov Amidror presented US administration and military officials with new intelligence data about Iran’s nuclear program. The findings included “Project 111,” a project to develop an intercontinental ballistic missile warhead and conduct large-scale high-explosive experiments, the Sunday Times reported. Amidror also noted that a Russian expert in Tehran had been involved for the past six years in helping develop Iran’s nuclear program.
Israel rejected US claims that any official order from Iran’s Supreme Leader, Ayatollah Ali Khamenei, to develop a nuclear bomb would soon reach them.
In the meeting, one Israel official told the Americans: “We’ll not know beforehand about such an order, you’ll not know, and probably Allah himself will not know. The time we’ll know for sure is when we wake up to a nuclear test.”
These days, owning a yacht is NBD. Like how McDonald’s supersized is now large, a mega-yacht is a super-yacht and a super-yacht is now a regular yacht. So what can these poor billionaires do to actually impress their friends? Buy one of these billion dollar themed mega-yachts of course! Yacht Island Design has designed two themed mega-yachts. The first is “The Streets of Monaco” based on the Principality of Monaco on the French Riviera. The second is modeled after a tropical island paradise.
For those not familiar with Monaco, it’s essentially the most “balling-est place on earth”. A popular tax haven, it is the top vacation spot for the world’s richest. It’s located on the beautiful French Riviera and is home of the Monaco Grand Prix and the famous Mote Carlo Casino. It’s only one square mile big and has the highest GDP in the world, with 2000+ millionaires and 5 billionaires as permanent residents. It has a monarchy with Prince Albert II as head of state. I had the chance to visit a few years back and I can confirm the Bentley Continental GT is their equivalent of a Honda Civic.
So for any billionaires who want to take a slice of Monaco with them, this 500 foot design is just what they need. It’s built on a much wider platform than your run-of-the-mill mega-yacht and features actual buildings instead of ship decks. It has three main zones. The “Oasis” is modeled after the gardens of Monaco, which features a full-featued spa and multiple pools and waterfalls, cascading into each other.The “Grand Atrium” is the main living area and suites. Features included a theater, library, casino, dance hall, wine cellar and Havana room. Most suites include their own reception room, dressing room and balcony.
The highlight is the “Streets of Monaco”. It has a scaled down version of the Monaco Grand Prix circuit that you can race on with actual F1 style go-karts. Yep, you heard me. It takes you on a tour of other famous Monaco locations, including the Hotel de Paris, Cafe de Paris, La Rascasse Hotel, Loews Hotel and the Monte Carlo Casino. There also is a tennis court and helipad. Yeah there’s a bunch of pool with swim up bars and Jacuzzis, you know the regular boring stuff you find on mega-yachts.
It also has two large sea-level garages for smaller yachts, its own submarine and “beach” level decks to let you swim and enjoy the ocean.
This is their second and smaller theme at 300 feet long. Here you can play the opposite of the Survivor reality show on faux-tropical island with all the luxuries of a mega-yacht. The main feature is the top deck, which features a cove with cabanas and palm trees surrounding a large main pool. The pool is deep and even allows viewing out the front of the yacht through a large glass wall. The volcano doesn’t gush lava, it just creates a waterfall for the pool.
Underneath the pool, there is a recreation area for a assortment of expensive water toys, such as jet skis, kayaks and boats. Another fun yacht toy I’d add for an extra $100k would be the JetLev water jet pack. There is also a obligatory helicopter pad. When I get mine commissioned, my volcano will only flow with Cristal 24/7.
Yacht Island Design has two more designs in the works: one will be Oriental themed and the other Middle Eastern. They also will design a themed mega-yacht to your imagination. Maybe an Inception-themed yacht within a yacht. With the top deck all water with another smaller yacht on top? What kind of theme would you chose for your yacht?Simon @CelebNetWorth on Sep.08, 2011
Rogers spoke with Business Insider to discuss commodities, the global economy, his legendary career, and his life in Singapore.
What follows is the complete transcript of our interview with Jim Rogers.
Inflation, Commodities and the Consumer
What is feeding into oil prices at the moment?
Iran obviously, is one thing, but another is in the U.S. it’s the infrastructure problem. We have oil but it’s in the wrong places. On the east coast, they use imported oil, and imported oil is higher because of Iran. And it comes from Europe. North Sea production is in decline. There are supply-demand reasons that oil prices are high in many parts of the world. And known reserves of oil are in decline worldwide. And the IEA is going around telling people that known reserves are in a steady decline and we’re going to have a huge problem in a decade or two, a gigantic problem, unless somebody finds a lot of oil very quickly. So underneath the supply-demand, shorter term it’s infrastructure and Iran probably.
At what level do you think oil prices will break the back of the American recovery?
We are going to have a slowdown. Such is the staggering debt that America has, it has caused more and more of a drag on our economy. I would also point out to you that every four to six years we’ve had an economic slowdown in the U.S., since the beginning of time, so by 2012, 2013, 2014, we are well overdue for an economic slowdown for whatever reason. Whether it’s caused by high oil or what, we’re going to have a slowdown in the foreseeable future.
How do you see oil prices impacting consumers in emerging markets, especially in Asia, when many of them are struggling to rein in inflation and drive growth?
Everybody is paying higher prices for oil and that obviously impacts consumption everywhere and its not just oil, its food and everything else that’s going up. There’s inflation everywhere, the U.S. lies about it, I mean the U.S. government lies about inflation but there’s inflation everywhere. I mean I don’t know if you go shopping, but if you do, you know prices are up. The government says they’re not, I don’t know where they shop. Everybody else’s prices are up.
If you could own / invest in just one commodity which would it be?
I guess it would have to be one of the agricultural commodities, it would depend on which is down the most but it would be agriculture I can tell you that.
You said earlier this year that if gold moved towards $1,600 you would be interested in buying more. Are you looking at gold now?
I’m certainly watching, if it goes below $1,600 I’m sure I’ll buy more. If it goes to $1,200 I hope I’m smart enough to buy a lot more. Gold has been up 11 years in a row now, which is extremely unusual for any asset. So it would not surprise me if gold doesn’t … continue to have a nice correction in 2012. If it does, if it does, I hope I’m smart enough to buy a lot more. I’m not selling. I’m not selling. I have not sold and will not sell until the bubble comes. There will be a bubble in gold some day but that’s ten years, I don’t know, several years from now. I hope I’m smart enough to sell when the bubble comes.
China and the emerging markets
You’re a China bull. Could you tell me the one thing that you think China bears have got wrong?
Not quite sure. If you mean the people who say China is going to explode. Those guys have been saying that for three years. I guess someday they’ll be right. So far they’ve been dead wrong, for years. There will be setbacks in China along the way. In America in the19th century we had 15 depressions with a capital “D,” we had no human rights, we had not much rule of law, (and we) had a horrible civil war, yet we became the most successful country in the 20th century.
China is going to have plenty of setbacks but what these guys are mainly missing is China has been in decline for three or four hundred years but started turning it around in 1978. And there’s a long history of entrepreneurship, capitalism, they have the brains, they have the know-how, there are many overseas Chinese who will bring back money and management ability. And the Chinese have a very, very high savings rate. They save over 35 percent of their income and so even if they start going off, they’ve got something to fall back on, as opposed to America and the rest of the world.
There was a housing bubble in urban, coastal real estate, which the government has popped purposely, I mean they knew what they were doing. But as far as, I mean Jim Chanos, says it’s going to be a thousand times worse than Dubai. Well that shows he doesn’t understand Dubai, and he doesn’t understand China. Now I’ve told him this to his face though, so I’m not talking behind his back. China is vastly different from Dubai, vastly.
Could you explain how Dubai and China’s real estate property problems differ?
Dubai was building its plan, its economic plan was to build an economy based on real estate speculation. It didn’t have anything else. It didn’t have oil, natural resources, it had a small population etc. and there was gigantic real estate speculation in construction. China has huge amounts of stuff. It has a growing population. It has vast natural resources, not enough, but it’s got some. And then all those natural resources in Siberia which they can tap and they’ve got huge financial reserves. Dubai does not. Dubai has a rich big brother, but that’s all Dubai has and China has it all – resources, cheap labor, discipline, educated labor and vast markets.
China lowered their growth rate, wage inflation is worrying and it’s the year of leadership change. Do you think China is in control in terms of their property prices and economic growth…
I doubt the government planned to have a bubble. They got a bubble. I mean they’ve been trying to cool it off and they’ve done so. As far as the lower growth rates, I don’t pay attention to government growth figures because they’re all phony. Nobody knows how much China is growing, including China. I don’t pay attention to all of these figures. They’re not important to me. They’re irrelevant. China is certainly doing better than most countries and it will continue to do so. It will have setbacks. There’s nothing that says China should not have a recession. But China has a lot of money saved for a rainy day and when it rains they’re going to spend. America doesn’t have any money saved for a rainy day. And when it rains we’re going to try to borrow it or print it,neither of which is good for America or for the world.
You have said previously that India is a great place to travel but not a great place for investors. What is the one thing that you do think makes a good investment opportunity in India?
Tourism. Tourism in India, partly because the Chinese can now travel and are traveling, and they’re very close and India is cheap. Indian tourism is going to be a wonderful, wonderful growth area in the next decade, or two, or three.
You have previously said those that invest in Myanmar could be rich in the next 20 – 40 years. Myanmar is beginning its process of reforms and is beginning to end its economic isolation form the West – what are your thoughts on Myanmar now?
China made the decision to open up in late ’78 but it took a while to put things in place. Myanmar has made the decision, they don’t even have their currency sorted out yet, so it’s going to take a while, but no ,everyday that goes by, I get more excited. Unfortunately I’m a citizen of the land of the free and we from the land of the free are not allowed to invest in Myanmar, it’s illegal. You could invest there, but I cannot.
Life in Singapore and career advice
What’s the one thing you miss the most about the U.S.? Conversely what’s the one thing Singapore has that the U.S. doesn’t?
Well I don’t really miss… I mean I go to the U.S., I was just there last week. My main complaint about Singapore is not a serious complaint but it’s not very bi-cycle friendly. The U.S. is much more bicycle friendly. I guess I wish Singapore were as bicycle friendly as parts of the U.S.
What’s your typical day like in Singapore?
“I take my daughters to school. We wake up at six because they have to get to school early. I take them on the bicycle, I come back, I exercise I have interviews while I’m exercising. I collect my daughters. I have lunch with them. Then in the afternoons I’ll have meetings, go on the computer or whatever. At night I’ll have dinner with my family unless we’re going out and then my wife and I will go out and do whatever the dinner is. And then I’ll go the disco. That’s a joke.
What’s the best piece of advice you ever got?
“Buy low and sell high. When I went to wall street. Actually all the old guys used to say ‘figure out the money and you’ll figure out what’s going on’. And so I don’t know of any specific individual but that’s advice I got a lot of times.
What’s the worst job you have ever had?
“Worst job? I don’t remember. Maybe the U.S. army, but even that, I don’t ever remember having a bad job. I was a grocery store boy when I was a teenager but even that, I learned, I don’t remember being unhappy in any job I’ve ever had. In the army, I would have liked to have done other things with those two years but even those two years were not totally wasted.”
Read more: BI
- JIM ROGERS: Jim Chanos Is Wrong About China And I Said It To His Face (businessinsider.com)
- JIM ROGERS: The Government Is Lying About Inflation And It’s Crushing The Consumer (businessinsider.com)
- 10 Quotes From The Always Charming Commodities Guru Jim Rogers (businessinsider.com)
- China Is About To Take A HUGE Step Toward Internationalizing Its Currency (businessinsider.com)
- Jim Rogers: Greece deal is a sham! (investmentpostcards.com)
March 8, 2012
I had dinner the other night with a bank executive in charge of government finance who told me that the aggregate spend of all the infrastructure projects in Panama totals more than $13 billion. This is roughly 50% of the entire Panamanian economy.
The equivalent in the United States would be the government announcing a ‘Rebuild America’ infrastructure spending initiative in the range of $8 TRILLION! No doubt, it’s a lot of money for this small country.
Panama (and particularly Panama City) has been in a seemingly perpetual state of construction for nearly 10-years. The long boom in residential construction created an impressive skyline of condo towers along the new Cinta Costera. But residential demand peaked and petered several years ago.
In an effort to keep the party going, the government has essentially swapped a residential construction boom for an infrastructure boom.
There are so many projects here, you’d think you were in Chonqing, China. And it’s made life miserable for anyone who has to get into an automobile– Panama City’s already dismal traffic has now become utterly hopeless.
The real issue is that Panama’s debt has been steadily rising to finance several projects. In many cases, the debt increase has outpaced the country’s dizzying GDP growth. For example, Panama’s debt rose 10.3% in 2010, while GDP only increased 7.5%.
According to some of my local attorneys who work on the deals, many of these infrastructure projects are now being creatively financed: selling bonds of off-the-books quasi-government entities that own securitized future cash flows.
It’s all an elaborate process to keep the debt from hitting the government balance sheet and obfuscating Panama’s true fiscal status. Official debt is now hovering near 50% of GDP, but the actual figure is much higher.
It’s possible that some of these projects will prove to be good investments– it’s not the same as Chinese ghost cities down here, Panama has legitimate infrastructure needs and is building accordingly.
What remains to be seen, though, is what happens after the infrastructure projects are complete in, say, another 5-years. The hope is that the real economy will have grown enough to absorb the loss of infrastructure spending. This supposition is not out of the question… but it’s definitely not guaranteed.
For now, nobody seems to mind. People are working, they’re making money, the country is improving… and except for the obvious and ridiculously high inflation rate, life is good.
To be clear, Panama is definitely a good news story. It has had one of the most resilient economies in Latin America over the past few years, and perhaps more than anywhere else in Central America, Panama has a very clear (and growing) middle class.
When you go out at night, you see Panamanians out on the town spending their discretionary income… and I mean regular Panamanians, not just the Porsche-driving 20-year olds who inherited papi’s business.
A strong middle class with disposable income is important in any healthy economy, and its emergence marks the transition from ‘developing’ to ‘developed’ nation. Panama still has a -long- way to go, but it’s moving in the right direction.
When I think back to how this place used to be 10-years ago (and all the years in between that I spent here) versus today, the positive change is overwhelming. When I think about how places like the US and Europe used to be 10-years ago, the change is resoundingly negative.
It’s this trend, by far, that’s most important.
Read more posts on Sovereign Man »
Here are some good macro thoughts that put the oil threat into perspective (via Credit Suisse):
“The impact on GDP: each 10% rise in the oil price takes 0.2% off US GDP growth and 0.1% off global growth. This time the negative impact of a high oil price on growth is limited as: oil is only 10% above its 6-month MA (changes matter more than levels for growth); other energy prices are muted (coal prices are at 12-month lows, US gas prices down 40% yoy) and CPI food price inflation should fall by 5pp from here (adding 0.7% to disposable income); critically, unlike 2008 and 2011, neither the ECB nor GEM central banks are likely to raise rates in response to higher energy costs; and US macro momentum is currently consistent with GDP 0.8% above 2012 consensus, suggesting some buffer before consensus estimates get downgraded.
Impact on equities: since 2007, equities have tended to fall when oil prices rise by 40% yoy (i.e. an oil price of c$150/bbl). From a macro perspective, we would start worrying if the rise in the oil price pushed up US CPI above 4% (that is when equities de-rate, c$160/bbl), US GDP started being revised down (c$150/bbl) or European inflation rose above 2% year-end (c$140/bbl). Another warning signal is when inflation expectations decouple and start falling as oil continues to rise (as has happened in the past week). Each 10% rise in the oil price takes 2% off European EPS and c1% in the US, on our estimates (yet current valuations can accommodate a c10% fall in earnings).
From a regional perspective, we rank countries’ sensitivity to oil by looking at: net oil imports, energy’s weight in the CPI, output gap and the correlation with oil prices. The winners from a higher oil price are Norway, Russia and Canada, while Thailand, Turkey and Korea are negatively affected. We show cheap domestic plays in the ‘winners’ and expensive domestic plays in ‘loser’ countries.”
Source: Credit Suisse
- Credit Suisse Explains When You Should Start Worrying About Oil Prices (businessinsider.com)
- Oil Implications And Fed Policy (zerohedge.com)
- For A Quick-Read On U.S. Economy, Check Oil Prices (ibtimes.com)
- The Mystery Behind Rising Oil Prices Solved (zerohedge.com)
- Emerging Europe: Rising Oil Prices Risk Growth More Than Inflation (ibtimes.com)
- This Is Why Oil Prices Are Hurting Europe More Than The US (businessinsider.com)
- Here Are The Winners In An Oil Price Shock (zerohedge.com)
TETRA Technologies, Inc. has acquired Optima Solutions Holdings Limited (“Optima”) for GBP 40 million (approximately $62.7 million equivalent) plus contingent consideration to be paid in the future depending on profitability.
Optima is a leading provider of rig cooling services and associated products that suppress heat generated by the high-rate flaring of hydrocarbons during offshore well test operations. Established in 1999, Optima has grown rapidly and has served a diversified customer base in over forty countries from operational bases in Aberdeen, UK, and Perth, Australia. Optima’s expectations for continued growth are underpinned by excellent long-term relationships with key customers, increasing international expansion, and a robust market outlook.
Optima’s rig cooling systems provide safety from the extreme temperatures generated during flaring operations and enable high-rate well test operations to be performed without compromising installation integrity, installation operations and personnel safety. Optima’s rig cooling packages employ patented nozzle technology and a wide range of associated pumping equipment that provide users with exceptional performance, reliability and safety.
“With this acquisition, we are accelerating our strategic goal of offering our customers a broader range of well completion and production testing services, and we are expanding our presence in many significant global markets. Optima is a strong complement to our existing portfolio of well completion and production testing services, and we believe we can add value for Optima’s customers through our experience in, and understanding of, those businesses. We are impressed with the relationships and market position that Optima has built and intend to support them within the TETRA family. In addition, we expect this acquisition to be accretive to our consolidated earnings in 2012,” commented Stuart M. Brightman, TETRA’s President and Chief Executive Officer.
Managing Director and founder of Optima, Jamie Oag, stated, “We are very pleased with our new ownership structure. We see this as the next phase in our strategic plan, increasing Optima’s global presence in a manner consistent with our best in class safety and service quality performance standards.” Mr. Oag went on to say that, “Both my fellow founder, Peter Bartholomew, and I, will remain with Optima, along with the remainder of our experienced management and operations teams.”
Simmons & Company International served as financial advisor to TETRA and Ernst & Young served as financial advisor to Optima.
TETRA is geographically diversified oil and gas services company focused on completion fluids and other products, after-frac flow back and production well testing, wellhead compression, and selected offshore services including well plugging and abandonment, decommissioning, and diving.
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