Friday, May 26, 2017

"Why Google Is Suddenly Obsessed With Your Photos"

Not "suddenly".
For both Facebook and the GOOG images have been an artificial intelligence/machine learning target for a half-decade, at least.

From The Ringer:

The next great Google product offers a window into a company reshaping itself around images, artificial intelligence, and even more of your personal data
Google tends to throw lots of ideas at the wall, and then harvest the data from what sticks. Right now the company is feasting on photos and videos being uploaded through its surprisingly popular app Google Photos. The cloud-storage service, salvaged from the husk of the struggling social network Google+ in 2015, now has 500 million monthly active users adding 1.2 billion photos per day. It’s on a growth trajectory to ascend to the vaunted billion-user club with essential products such as YouTube, Gmail, and Chrome. No one is quite sure what Google plans to do with all of these pictures in the long run, and it’s possible the company hasn’t even figured that out. But in a landscape fast becoming dominated by artificial intelligence, data — in this case, your photos — has become its own reward.

At the company’s annual I/O developers conference, Google touted Photos as a signature platform getting a bevy of valuable updates. Users will soon be able to automatically share all their uploaded photos with a loved one, or filter which specific photos are auto-shared by date or topic. A new Suggested Sharing feature will use facial recognition to prompt users to send photos of their friends directly to them, similar to Facebook’s Moments app. The service already uses machine-learning algorithms to classify the objects in photos and make them searchable, so that users can easily find all their pictures of dogs or beer or sunsets. With all these perks, plus unlimited storage, Google Photos is set to become the most convenient, powerful option available for managing a large media library. No wonder the app’s user base has grown so fast. (Though I have my doubts about how “active” these users are — Photos comes preinstalled on Android devices and automatically collects your photos; I mostly use it to look up a friend’s dad’s HBO password that I screencapped once in 2014.)
But the question remains: Why is Google offering such a feature-rich product that doesn’t appear to be readily monetizable, outside of the few print photo books the company plans to sell? The simplest answer is that the company wants to keep people within its all-encompassing ecosystem. Today’s tech giants now offer to serve as caretakers to our digital lives across a suite of services in exchange for access to our personal information. “Even if Google doesn’t make any money directly from something that it offers, it’s still gathering data,” says Pedro Domingos, a computer science professor at the University of Washington and author of The Master Algorithm. “Increasingly these days, what people perceive at companies is that data is one of your biggest assets.”

What more data could Google possibly need? The search giant has effectively achieved its longstanding goal of “organizing the world’s information,” if you consider only the written word. But even cofounder Larry Page has acknowledged that the company’s mission statement is outdated. The internet is fast becoming dominated by visual messaging, benefiting platforms such as Facebook, Instagram, and Snapchat. Google Photos, especially now that it’s been fine-tuned for sharing, is a back door into the social networking and chat functionalities that Google has been trying and failing to pitch to customers for the last decade. While we allow the company to passively track us through platforms like Chrome and Maps, Google Photos may be the first Google product that persuades people to actively share their personal information with the company en masse since Gmail.
The data obtained from a photo, though, has the potential to be much more sensitive than what’s contained in an email. Google already has plenty of pictures of objects that it’s indexed across the web with its search engine, but it still doesn’t know that much about what individual people look like. To make the Photo app’s sharing and tagging features work, Google has to analyze a photo subject’s facial structure and create a unique “faceprint” for them. The company is currently fighting a lawsuit in Illinois alleging that this facial-recognition technology violates a state law protecting citizens’ biometric data, and the tech hasn’t been rolled out in many parts of Europe for fear it might run afoul of privacy laws.

The ability to quickly categorize people, places, and things is the entire selling point of Google Photos, of course, and facial recognition helps achieve that aim. But as Google’s AI techniques become more sophisticated, the company is weaving an ever-growing web of relational data about the world. Some of it is user-submitted (you can ID your own face in Photos or tag friends’ faces), but much of it is derived from the unknowable calculations of the company’s powerful algorithms, which are being trained to be able to teach themselves in the same way a human can use current knowledge to interpret new information. When I Google my mother’s name, her picture doesn’t come up in the public search results. But if I search “Mom” in my Google Photos library, there’s a picture of us at a restaurant in October, which I definitely never tagged “Mom.” (I asked Google to explain how this happened. A spokesperson said Google Photos doesn’t analyze facial structure to look for familial similarity and that the result may have occurred because characteristics of the photo matched images labeled “mom” in Google’s public image search database.) Accurately ID’ing my mom is an example of Google’s machine-learning systems getting smarter. It’s also extremely creepy...MORE.
We have so many posts on artificial intelligence and neural networks it is almost overwhelming.
Use the blog search box if interested.

Atlanta Fed: "GDPNow's Second Quarter Forecast: Is It Too High"

From the Federal Reserve Bank of Atlana's Macroblog, May 22:
Real gross domestic product (GDP) growth slowed from a 2 percent pace in 2016 to an annual rate of 0.7 percent in the first quarter of 2017. The Federal Open Market Committee viewed this slowdown in growth "as likely to be transitory," according to its last statement.

Indeed, current quarter GDP forecasting models maintained by the Federal Reserve Banks of New York, St. Louis, and Atlanta have been pointing toward stronger second quarter growth (2.3 percent, 2.6 percent and 4.1 percent, as reported on their respective websites on May 19, 2017).
The Atlanta Fed's model—GDPNow—is at the high end of this range and is also high relative to other professional forecasts. The median forecast for second quarter real GDP growth in the May Survey of Professional Forecasters (SPF) was 3.1 percent, for instance, and recent forecasts from Blue Chip Publication surveys displayed on our GDPNow page show some divergence from our model as well.

We encourage—and frequently receive—feedback on our GDPNow tool, and some users have suggested that our forecast for second quarter growth is too high. In fact, some empirical evidence supports that view. The evidence considered here correlates differences between consensus Blue Chip Economic Indicators Survey and GDPNow forecasts for growth about 80 days before the first GDP release with the GDPNow forecast errors (see the chart below). 
A note about the chart: The horizontal axis shows the difference between the Blue Chip consensus forecasts and GDPNow's forecast. The vertical axis measures the 80-day-ahead GDPNow forecast error, defined as the difference between the first published estimate of real GDP growth and the GDPNow forecast at the time of the mid-quarter Blue Chip survey.

As the chart shows, there is a positive relationship between the Blue Chip-GDPNow discrepancy and the GDPNow forecast error. A simple linear regression would predict that the GDPNow forecast of 3.7 percent growth on May 5 was too high by nearly 1.0 percentage point. Moreover, the chart suggests that there has been a bias in GDPNow forecasts since the fourth quarter of 2015 of between 0.9 and 2.0 percentage points at the time of these mid-quarter Blue Chip surveys. If you are inclined to think the GDPNow forecast for second quarter growth is a bit too high, then this evidence will not change your mind....MORE

Natural Gas: EIA Weekly Supply/Demand Report

Prices have been grinding higher since 2016 and, if LNG shipments to Asia pick up as some have forecast, should continue higher. Partially offsetting demand is increased supply of associated gas from oil drillers but, and that's a big but, depending on this year's weather the trend seems set on a yearly basis.

One thing to watch in 2018 and beyond is how fast China and Japan develop their clathrate technology.
Anyhoo, 3.2880 up 1.3 cents.

From the Energy Information Administration:

Prices fall. This report week (Wednesday, May 17 to Wednesday, May 24), the Henry Hub spot price fell 5¢ from $3.16/MMBtu last Wednesday to $3.11/MMBtu yesterday. Despite a price fall week over week, prices are substantially higher than last year at this time. Yesterday's Henry Hub price, for example, was 63% higher than a year ago, when it stood at $1.91/MMBtu. Last year's prices were historically low largely because of downward pressure from record high storage stocks following an unusually warm winter.

At the Chicago Citygate, prices decreased 2¢ to $3.03/MMBtu yesterday. Prices at PG&E Citygate in Northern California gained 3¢ to $3.38/MMBtu yesterday. The price at SoCal Citygate rose 8¢ to $3.25/MMBtu yesterday.

Algonquin price falls significantly. At the Algonquin Citygate, which serves Boston-area consumers, prices went down $1.22 from $4.17/MMBtu last Wednesday to $2.95/MMBtu yesterday. Prices were elevated last Wednesday with hot weather pushing up power demand and with a capacity reduction at Algonquin's Burrillville Compressor Station in Rhode Island, which may last for about two weeks.

At the Transcontinental Pipeline Zone 6 trading point for New York, prices decreased 28¢ from $3.18/MMBtu last Wednesday to $2.90/MMBtu yesterday.

Tennessee Zone 4 Marcellus spot prices decreased 15¢ to $2.53/MMBtu yesterday. Prices at Dominion South in northwest Pennsylvania fell 11¢ to $2.66/MMBtu yesterday.

June Nymex increases slightly. At the Nymex, the price of the June 2017 contract increased 2¢, from $3.192/MMBtu last Wednesday to $3.209/MMBtu yesterday. The price of the 12-month strip, which averages June 2017 through May 2018 futures contracts, climbed 1¢ to $3.323/MMBtu.

Supply remains flat. According to data from PointLogic, the average total supply of natural gas remained the same as the previous report week, averaging 76.6 Bcf/d. Dry natural gas production remained constant week over week. Net imports from Canada remained the same as last week, averaging 5.7 Bcf/d.

Demand remains flat. Total U.S. consumption of natural gas was unchanged from last week, averaging 56.5 Bcf/d according to data from PointLogic. An increase in power burn was offset by a decrease in residential/commercial sector consumption. Power burn climbed by 5% week over week. Industrial sector consumption stayed constant, averaging 20.0 Bcf/d. In the residential/commercial sector, consumption declined by 11%. Natural gas exports to Mexico increased 1%....

Thursday, May 25, 2017

"Fed Trial Balloon: JPM Warns Fed May Start Shrinking Balance Sheet In September"

I was pulling ZeroHedge's aureate teat with the post immediately below, here's the story I was actually going for.
From ZeroHedge:
It appears the Fed's balance sheet "trial balloons" using primary dealers as intermediaries have begun.
After yesterday's unexpectedly explicit guidance on the future of the Fed's balance sheet, which prompted Goldman, Citi, and various other banks to suggest they may bring forward their estimates for when the Fed will announce the start of "renormalization", moments ago JPM's Michael Feroli, traditionally the analysts "closest" to the Fed, did just that when he issued a report stating that that there is now "chance of a September start" to renormalization, with the values for monthly roll-off caps and phase-in period to be "revealed at the June FOMC meeting."

According to Feroli, JPM continues to look for normalization to commence at the December FOMC meeting but "there is some chance of a September start, though this would not have a material difference for our projections on a multi-year horizon. At the meeting at which normalization starts we expect the Committee to announce a set of monthly roll-off caps for the following year, which increase regularly every three months.
"Our best guess is that the initial caps are $4 billion a month for MBS and $8 billion a month for US Treasuries. In the preannounced schedule, these caps would be augmented each quarter by $4 billion and $8 billion, respectively, until at the end of the year they are $16 billion and $32 billion. Consistent with yesterday’s minutes, even after the normalization process is fully phased in the monthly caps will still be in place, though in most months after the full phase-in they would cease to bind."
And here are the finer details which the Fed may or may not have leaked to select banks, in an attempt to prepare for what is coming, and talking down the equity bubble....MUCH MORE
Shrinking The Federal Reserve's Balance Sheet

Questions America Wants Answered: "Should I Invest My Fortune in Gold?"

From ZeroHedge:

Should I Invest My Fortune in Gold? Latest Research
- Should I invest my fortune in gold?
- Lessons from gold and silver: Reviewing the research
- What precious metals can tell us about finance?
- What are precious metals and why should we care?
- What size of market and how evolved over time?
- Long and detailed history of gold and silver as money
- What does a tonne of gold look like?

...MORE, including:

"- Game of Thrones & Scrooge McDuck's gold and the Hyperinflation of Smaug"
"- Do not spend too long staring at and obsessing about gold or might turn into Gollum"

Ctrl-Walt-Delete: Mossberg's Final Column at the Verge: "The Disappearing Computer"

The first half of the headline is from The Verge's:

Ctrl-Walt-Delete: our last in-studio show
Our 75th episode
Walt Mossberg’s final weekly column at The Verge before retirement was published today. Our beloved podcast Ctrl-Walt-Delete traditionally echoes his column, and this week’s episode (our 75th!) is no different. In our last episode recorded in studio, Walt and Nilay talk through Walt’s column and the future of tech. The show also focuses on each of the big tech companies and what is possibly in store for their future. 

This is an episode you are not going to want to miss....MORE

...And I know what you’re thinking... the last show? Well, kind of. We are happy to announce that we are doing a live taping of Ctrl-Walt-Delete for our final show!...
While the final column begins:
Mossberg: The Disappearing Computer
May 25, 2017, 10:00am EDT 
Tech was once always in your way. Soon, it will be almost invisible
This is my last weekly column for The Verge and Recode — the last weekly column I plan to write anywhere. I’ve been doing these almost every week since 1991, starting at The Wall Street Journal, and during that time, I’ve been fortunate enough to get to know the makers of the tech revolution, and to ruminate — and sometimes to fulminate — about their creations.

Now, as I prepare to retire at the end of that very long and world-changing stretch, it seems appropriate to ponder the sweep of consumer technology in that period, and what we can expect next.
Let me start by revising the oft-quoted first line of my first Personal Technology column in the Journal on October 17th, 1991: “Personal computers are just too hard to use, and it’s not your fault.” It was true then, and for many, many years thereafter. Not only were the interfaces confusing, but most tech products demanded frequent tweaking and fixing of a type that required more technical skill than most people had, or cared to acquire. The whole field was new, and engineers weren’t designing products for normal people who had other talents and interests....MORE
Both the NASDAQ Composite Index and the Nasdaq 100 saw record-high intraday and closing values today.

See also the commentary of: Garcia, Weir, Lesh, and Hunter, 1970:

Engineer Who Jumped From Ford to Uber Leaves Kalanick & Co, Back to Ford to Head Up Self-Driving Ops (F)

He's not the only one who wants to get the hell out, there may be a dozen or more upper level engineers and roboticists thinking the same thing.
From TechCrunch:

Sherif Marakby rejoins Ford to lead self-driving after leaving Uber
After leaving his role at Uber as VP of Global Vehicle Programs in April, Sherif Marakby is back at Ford to lead its autonomous vehicles and electrifications program. Marakby’s new VP role was announced as part of a general executive re-organization revealed on Thursday under new Ford CEO Jim Hackett.

Marakby joined Uber in April 2016, coming from Ford where he worked for 25 years, most recently as Director of Global Electrical/Electronic Systems Engineering. When Marakby’s departure from Uber became public in April, he didn’t specific future plans or a reason for his departure.

In his new role at Ford, Marakby will be a VP reporting to EVP and President of Global Markets Jim Farley....MORE

$500 Million Poppy Field Being Grown By Moron Found In North Carolina

From the Charlotte Observer:

Acre of opium poppy plants found in Catawba County field. Value: $500 million
The Catawba County Sheriff’s Office seized an entire field of poppy plants Tuesday, the 2,000 plants have an estimated value of $500 million.

Authorities admit that’s a rough estimate on the value, because the plants still need to be weighed.

The plants are used in the manufacturing of opium, and growing them is far from legal. The field was about an acre located near Claremont, a Catawba County town about 40 miles north of Charlotte. It has a population of about 1,300 people.

“This is the second one in the nation,” Sheriff Coy Reid told the Hickory Daily Record. “One of our narcotics investigators came to the house looking for something else. When he knocked on the door, the guys said, ‘I guess you’re here about the opium.’ 

The plants were in rows, like corn, in a field behind a home on Poultry Road.

One person in a nearby home was charged in connection with the field, the Daily Record reported.
Catawba County Sheriff's Office deputies got a tip last week and were able to obtain a search warrant, reported WBTV, the Observer’s news partner. The station identified Cody Xiong as the suspect arrested and charged with manufacture and trafficking by possession.

Xiong is also suspected of being involved in a cockfighting operation, due to a number of chickens found at the home with unusual wounds, officials said...MORE

Read more here:
An acre-wide opium poppy field plant discovered in Catawba County, N.C.(WBTV)
"Oh, what's happening? I'm so sleepy, I can't run anymore. Oh please, I have to rest for just a minute, Toto, where's Toto? Yawn..."
Dorothy Gale (1939)

Read more here:

Read more here:

Nine of the World's Biggest Packaged Food Companies Have Launched Venture Capital Units

Not our favorite industry.
As noted in the intro to last March's "M&A In European Food":
I'm not sure that consumer packaged goods is the area to be in, at least not in the U.S. and not based on names like Kellogg or General Mills.

For a quarter-century those manufacturers ratcheted prices as though they were tobacco companies but people find it easier to give up their Cheerios than their cigarettes.

The managements milked that approach for pretty much all it was worth so, as operating entities, they aren't all that attractive but someone will decide the only thing left to do is to asset strip or dividend recap the life out of the former cash cows....
Who knows though, maybe they've bottomed, see charts after the jump.

An extensive piece from Reuters, May 24:
Food and drink megabrands are seeing their sales chewed away by smaller, nimbler, cooler rivals. They can't beat them - so now they're joining them.

Nine of the world's biggest industry players, including Danone (DANO.PA), General Mills (GIS.N), Campbell Soup (CPB.N) and Kellogg (K.N), have launched venture capital units over the past 18 months, a Reuters analysis of the sector shows. 

The aim of the strategy, according to interviews with executives, is to buy into - and learn from - the kind of start-up innovation that has become their nemesis, from micro-distilled spirits and cold-pressed juices to kale chips and vegan burgers.

Food and drink multinationals spend far less on R&D than their counterparts in many sectors like tech and healthcare. They have been wrongfooted over the past five years by the shifting habits of consumers who are increasingly shunning established brands in favor of small, independent names they regard as healthier, more authentic and original.

This is forcing the companies to take a leaf out of Silicon Valley's venture capital playbook - and their success or failure in harnessing promising new trends at a very early stage could help determine how well they adjust to the changing landscape, and whether they ultimately emerge as winners or losers.
"It's difficult for companies to have the persistence and to replicate the energy and the passion that these early-stage entrepreneurs have," said John Haugen, head of General Mills' venture capital arm 301 Inc, adding innovation was extremely tough because of how quickly market trends were changing.

"We're just a year or a little more than that into these investments," he said of 301, where his team of about 15 sits down twice a month to pass around dozens of samples from start-ups. "For me it's part of a total long-term growth strategy for our company."

In the United States - the world's biggest packaged food market - small "challenger" brands could account for 15 percent of a $464 billion sector in a decade's time compared with 5 percent now, according to Bernstein Research.

The researchers point to successful upstart brands like Chobani Greek Yogurt, which they say has stolen more than half of General Mills' market share in yogurt, and Kind Snack Bars which have taken a big bite out of Kellogg's snack bars.

The nine companies to recently launch venture capital arms also include Hain Celestial (HAIN.O), Tyson Foods (TSN.N) and Pernod Ricard (PERP.PA). Typically, their funds range in size from about $100 million to $150 million.

While it is still early days for them, the experiences of the handful of food and drink firms that have had funds for several years - Nestle (NESN.S), Unilever (ULVR.L), Coca-Cola (KO.N), PepsiCo (PEP.N) and Diageo (DGE.L) - could offer some guide to the future....MUCH MORE 
HT: Quartz, whose piece, "Giant Food Brands are Coming for Your Kale Chips and Craft Whiskeys" contains a sentence I guarantee I've never seen before:
These venture capital units are allowing moves like Kellogg’s first investment, on Kuli Kuli, which makes snack bars out of the nutrient-rich moringa plant
And on to the charts of the two companies mentioned in that March 7 post:

GIS General Mills, Inc. daily Stock Chart

K Kellogg Company daily Stock Chart

Risk: Ahead of Next Week's Official Start of Hurricane Season Forecasts Getting Bumped Up

We'll have more next week but for today here's Artemis:

2017 hurricane season forecast upped to above average by Weather Co.
The Weather Company has revised its forecast for the 2017 Atlantic tropical storm and hurricane season, saying that the latest indications and data now suggest a year with activity levels a little above average.

The Weather Company now forecasts that the 2017 season will see a slightly above average 14 named tropical storms, 7 hurricanes and 3 hurricanes that reach major status of Category 3 or higher, which should be noted by reinsurance interests.

It’s previous forecast from April had been for 12, 6 and 2, which was an average for  a year.
The forecaster says that the latest observations show warmer sea-surface temperatures in the North Atlantic, which tend to correlate with more active tropical seasons. There are indications that further warming is also possible, which could add to increased activity.

“The historically strong North Atlantic blocking event in early May also suggests the possibility of continued increases in North Atlantic sea-surface temperature anomalies, so it would be no surprise if we increased our forecast numbers again,” explained Dr. Todd Crawford, chief meteorologist with The Weather Company.

The Weather Company also says that it forecasts “a reduced potential for the development and strength of El Niño later this summer.”

El Niño can have a strong influence on hurricane and tropical weather activity levels, and the forecaster notes that there is “plenty of uncertainty regarding El Niño’s possible development, and therefore, how much of an effect it could have on the hurricane season.”

El Niño had previously been cited by forecasters as the main reason for below-average forecasts for the 2017 tropical season, but with the chances of an El Niño now seen as a little lower this is factoring into the latest updates.

As ever the reinsurance and insurance-linked securities (ILS) community are most concerned about landfalls in the United States, the source of major catastrophe loss events....MUCH MORE
Here's our last (April 20) visit to Artemis:

Insurance: "2017 hurricane forecasts suggest below average season due to El Niño" 
A number of forecasts have been released for the 2017 Atlantic Tropical Storm & Hurricane Season and so far all are calling for activity levels just below the long-term average, with the expectation that we will see a weak El Niño by the typical peak of the season suggesting a slower year....
2017 Atlantic hurricane season forecasts

And on The Weather Company:
IBM's Watson Gets A Real Job: Big Blue Closes Purchase of The Weather Company

IBM Says Their Newly Purchased The Weather Company Is An IoT Platform 
And here I was thinking* the purchase was just a fancy way to mobilize Watson as a crop-insurance salesman along the lines of Google funded The Climate Corporation
The Weather Company (Weather Channel) to Pay $600 Mln Dividend to Sponsors, Including Bain and Blackstone

And if interested:
Ha! Monsanto Buys Crop Insurer/Data Co. for $930 Mil. (MON)

Shrinking The Federal Reserve's Balance Sheet

As noted in last week's "Gavyn Davies: 'The consequences of shrinking the Fed’s balance sheet'":
This has the potential to be the most important econ/finance/market story of the second half of this year....
And going back to the FT well, from FT Alphaville:

Snap AV: Here’s the Fed’s balance sheet shrinkage plan
From the Fed’s May meeting minutes, with our emphasis:
Under the proposed approach, the Committee would announce a set of gradually increasing caps, or limits, on the dollar amounts of Treasury and agency securities that would be allowed to run off each month, and only the amounts of securities repayments that exceeded the caps would be reinvested each month. As the caps increased, reinvestments would decline, and the monthly reductions in the Federal Reserve’s securities holdings would become larger. The caps would initially be set at low levels and then be raised every three months, over a set period of time, to their fully phased-in levels. The final values of the caps would then be maintained until the size of the balance sheet was normalized.
Let’s not forget that the New York Fed’s definition of “normalized” is still pretty big. Their baseline projection is that it’ll fall just below $3tn, with $1.5tn of that in Treasuries and slightly less in mortgage-backed securities...

So, reducing the Fed’s balance sheet at the same time they are raising interest rates.
And since this is uncharted territory we aren't quite sure how, exactly, the shrinkage will affect...stuff.
Should be interesting.

Currencies: "Euro Strength more than Dollar Weakness"

From Marc to Market:
The Dollar Index is heavy, just above the lows set earlier this week set near 96.80. However, this exaggerates the dollar's weakness because the weight of the euro and currencies that shadow it, like the Swiss franc and Swedish krona.

As the North American session is about to start, the dollar is higher against the dollar-bloc currencies and the Japanese yen. The Scandi's are flat and sterling is turning lower. That leaves the dollar weakness limited to the euro and Swiss franc.

The euro reached a high earlier this week just shy of $1.1270. It has run out of steam today near $1.1250. Between $1.1175 and $1.1200, there are nearly 1.4 bln euros in options expiring. Sterling was sold in response to the downward revision in Q1 GDP to 0.2% from 0.3%. The UK economy had expanded by 0.7% in Q4 16. Services and production were revised lower and net exports took 1.4 percentage points off GDP, a record drag. There are nearly GBP270 mln options struck at $1.2940 that roll-off today. Sterling has not closed below its 20-day moving average (~$1.2940) since April 10. We note that the technical condition for sterling may be deteriorating. The MACDs and RSI show bearish divergence.

Separately, when US President Trump began this extended trip, many thought that Israel would object to the Administration's handling of intelligence, but it turns out the British seem more concerned. The BBC reports that Prime Minister May will raise the issue at the highest levels following the British police have stopped sharing information with US officials.

Minutes from the FOMC meeting seems to confuse some. To be sure, the market continues to believe that a hike next month is as done of a deal as these things can get. Our calculations suggest fair value for the June Fed funds futures contract, assuming a hike and some softness at the end of the quarter, is about 1.04%, while the contract currently implies 1.015%.

Some are trying to explain the pullback in US bond yields as a response to the FOMC statement that more evidence that weakness in Q1 was transitory before removing more accommodation. We read this as a justification for not hiking rates this month, rather than change in forward guidance. The December Fed funds futures contract implied yield was 1.215% at the end of last week. It closed yesterday at 1.23%.

The Fed's balance sheet strategy is evolving. The minutes confirmed expectations that the Fed is thinking to begin the process of not replacing maturing issues slowly and then increasing them. It is a rolling start that was one of the common scenarios discussed by investors. However, the FOMC did not how much it may begin with, though subjectively we thought $5-$10 bln divided, even if not evenly, between Treasuries and MBS. The other important question is what size balance sheet does the Fed eventually want. Bernanke recently suggested $2.3-$2.8 trillion....
... MORE
Here's the last year of the euro from FinViz:

Wednesday, May 24, 2017

The Brain Predicts Whether You Want It To or Not

From The Verge:

Our brains predict events in fast-forward
Your brain on autocomplete
What happens when you look up and see a ball headed toward you? Without even thinking about it, you flinch. That might be because our brains are constantly living our lives in fast-forward, playing out the action in our head before it happens. 

Humans have to navigate, and respond to, an environment that is always changing. Our brain compensates for this by constantly making predictions about what’s going to happen, says Mattias Ekman, a researcher at Radboud University Nijmegen in the Netherlands. We’ve known this for a while, but these predictions are usually associative. An example: if you see a hamburger, your brain might predict that there will be fries nearby. In a study published today in the journal Nature Communications, Ekman and other scientists focused instead on how the brain predicts motion. So they used brain scans to track what happened as participants observed a moving dot. 

First, 29 volunteers looked at a white dot the size of a ping-pong ball. The dot went from left to right and then reversed directions. The volunteers watched the dot for about five minutes while scientists scanned their brains with ultra-fast fMRI. This way, the researchers know what pattern of brain activity was activated in the visual cortex while they watched the dot. 

After these five minutes, the researchers showed only the beginning of the sequence to the volunteers. Here, the scans showed that the brain “autocompletes” the full sequence — and it does it at twice the rate of the actual event. So if a dot took two seconds to go across the screen, the brain predicted the entire sequence in one second. “You’re actually already trying to predict what’s going to happen,” says Ekman. “These predictions are hypothetical, so in a way you’re trying to generate new memories that match the future.”

In fact, “twice as fast as real-time” might not be the actual number because it’s limited by the brain scans, notes Ekman. An electrode placed directly in the brain might find that the rate of compression is even faster. (It’s worth noting here that the brain scan they did use, called fMRI, can sometimes be unreliable. It measures brain activity by recording how blood oxygen levels change, not by directly measuring what’s happening. And sometimes there are false positives, like when one study showed brain activity in a dead salmon.)...MORE
I might be willing to bet on the dead salmon's brain activity over that of the Russian demolition audience:
Although, on the other hand, he has an insouciance that even the salmon (deceased) would be hard-pressed to match.

Shillong the Indian Town Obsessed With Bob Dylan

And a slightly less doomy-and-gloomy piece than the post immediately below.
From the Independent:
In the little visited state of Meghalaya lies India’s self-styled rock music capital. Charukesi Ramadurai visits Shillong, where Bob Dylan is worshipped above all others

Bob Dylan is on my mind this balmy winter afternoon in Shillong – just as I’m sure he is on a million other minds all over the world. It’s just over a month since the big news about Dylan’s controversial win of the Nobel Prize for Literature, but that’s not the reason I am thinking of the man behind “Mr Tambourine Man”.

Shillong, the capital city of the scenic northeast Indian state of Meghalaya, thrives on music. The town has earned itself the moniker of India’s rock music capital – even if cynics say the title is self-anointed – thanks to its various music festivals and local bands like Soulmate, which have now made a name for themselves across the country.

But it’s not all about rock – more than anything, Shillong loves Bob Dylan. Dylan has never visited – in fact, he’s never performed in India and is thought to have visited only once, for a wedding – but the people of Shillong don’t care. For several decades now, the city has hosted an informal celebratory concert every year on his birthday: 24 May.

What began as a small meeting of friends to celebrate an idol’s birthday has now turned into a major event in the regional music calendar. And although there are no celebs on offer, musicians and fans from all over India now trudge into Shillong for this. The annual tradition was started in 1972 by local celebrity Lou Majaw – known as the grand old musician of Shillong, and homegrown Dylan fan – some say fanatic. But there is no doubt that he is good at what he does.

This 70-going-on-17-year-old musician regularly performs Dylan’s songs at some of the most popular pubs and cafés in town. Majaw does have other music to his credit, including his own songs, but it is the Dylan impressions that have won him acclaim – and these days he mostly sticks to them. He’s so famous in Shillong that he’s even had a documentary made about him almost a decade ago....MUCH MORE
Here's the vid: 
Forever Young (Documentary - 59 mins)

"India vs. Pakistan: Which Army Would Win?"

In the last week we've seen the Financial Express on May 17 say "War threats from China, Pakistan! India to deploy Rafale fighter jets in Haryana, West Bengal: Report", and from Strategy Page:
May 23, 2017: In northwest India (northeast Pakistan) Kashmir border violence continues to spiral out of control. A local hotline was established, apparently more for publicity than peace, but on the Pakistani side of the hotline the message was the same; we are not at fault. This is mainly about the Pakistani military needing a justification for their wealth (much of it gained via corrupt practices) and power (to overthrow a government they see as a threat to themselves)....MORE
And from dozens of other sources, ditto.

The headline story, from The National Interest (U.S.) dropped out of one of the feedreaders a few days ago and reminded me we haven't seen this recent level of saber-rattling for quite a while.
The quick and dirty answer is India wins but only if China stays out.

From The National Interest:
The Indian subcontinent is home to two of the largest armies on Earth. Not only are the armies of India and Pakistan both larger in personnel than the U.S. Army, but they have stood at alert facing one another since the dissolution of the British Indian Army in 1947. The two armies have clashed four times in the past seventy years, and may yet do so again in the future.

The Indian army is the primary land force of the Indian armed forces. The army numbers 1.2 million active duty personnel and 990,000 reservists, for a total force strength of 2.1 million. The army’s primary tasks are guarding the borders with Pakistan and China and domestic security—particularly in Kashmir and the Northeast. The army is also a frequent contributor to United Nations peacekeeping missions abroad....MORE
...If the two countries went to war, a major clash between the two armies would be inevitable. Outnumbered and under-equipped, the Pakistani army believes it is in a position to launch small local offensives from the outset, before the Indian army can reach its jumping-off points, to occupy favorable terrain. Still, the disparity in forces means the Pakistanis cannot hope to launch a major, war-winning offensive and terminate a ground war on their own terms. As a result, the Pakistani army is increasingly relying on tactical nuclear weapons to aid their conventional forces.

For its part, the Indian army plans to immediately take the offensive under a doctrine called “Cold Start.” Cold Start envisions rapid mobilization followed by a major offensive into Pakistan before the country can respond with tactical nuclear weapons. Such an offensive—and Pakistan’s likely conventional defeat—could make the use of tactical nuclear weapons all the more likely....
A half-decade ago it seemed we had an India-Pakistan war threat every six months or so.
Here's October 2014: "The India-Pakistan Border Appears to Be Heating Up"
January 2013: "In Other News: 'India Warns Kashmiris to Prepare for Nuclear War'"
May 2012: "A Possible (nuclear) Water War Between Pakistan and India"
And even back to 2008: "Pakistan: We're ready for war with India . And: Pakistan, India troops exchange fire at Chakoti sector".

In most of the posts we would embed the Wagah Crossing flag lowering ceremony:

Palin at the India-Pakistan border ceremony - BBC 
And hope his bit never got tested:
Problem Solved: "Small Nuclear War Could Reverse Global Warming for Years"

Just this morning Quartz India disagreed on a war outcome but illustrated their story "For all the chest-thumping, India cannot win a war against Pakistan" with a big ol' picture of Wagah:

Hedge Funds: "Crispin Odey cites Hitler's Russia invasion to explain bearish outlook"

I believe Mr. Odey has either stopped or even reversed the fund's losses but the last couple years have been brutal for the old boy.
From City AM:

Crispin Odey has used the logic of one of Adolf Hitler's ministers to explain his bearish outlook for UK stocks.
Odey's main hedge fund lost 50 per cent last year due to failed bets on falling asset prices.

But, he has told investors won't be changing his stance, and justified his position by comparing the UK to Germany near the end of World War Two.

In particular, he wrote about Fritz Todd, Hitler's armaments minister, who predicted Germany would fail in its effort to invade Russia in 1942.

In an investor letter seen by Bloomberg News, Odey said: "What he could see was that the lines of supply were at breaking point.

"Success was the necessary ingredient of failure."

And, in the UK, Odey predicts that people are starting to borrow money they won't be able to pay back....MORE
Also at City AM: "This billionaire hedge fund manager's wealth dwindled to millions last year"

I can't help thinking of a bit o' "Holy Grail" dialogue:
Black Knight:     I am invincible! 
King Arthur:       You're a loony! 
Crispin Odey: "It Feels Lonely Being Bearish"
Crispen Odey’s Hedge Fund Announces Its Worst Ever Annual Loss

And last year:
Dec. 29
Crispin Odey Doesn't Sound Crazy But...
Dec. 9
In Which FT Alphaville's Bryce Elder Shreds Former Big Wheel Hedgefunder Crispen Odey
Nov. 3
Follow-Up: "Odey Hedge-Fund Assets Dip 60% as Clients Shun ‘Bitter Pill’"
Nov. 2  
The Stress May Be Getting To Hedgie Crispin Odey--UPDATED
Oct.4 ZeroHedge
For Crispin Odey This Is The Endgame: Hedge Fund Billionaire Goes All In Betting On "Violent Unwind" Of QE Bubble
Sept. 16 
Crispin Odey Is Getting Crushed
Aug. 13 Zerohedge
Billionaire Crispin Odey, Who's Had A Pretty Terrible Year, Is Betting Everything On Gold
May 23 
Hedge Funder Crispen Odey Has Become a Parody of.....Crispen Odey   

The Cloud Panopticon: Google, Cloud Computing and the Surveillance-Industrial-Complex

In answer to Ms Kaminska's question:
We've been sitting on this link for going on two weeks, this seems an appropriate time to post.

From CounterPunch, May 12:
In June 2007, Privacy International, a U.K.-based privacy rights watchdog, cited Google as the worst privacy offender among 23 online companies, ranking the “Don’t Be Evil” people below Microsoft, Apple, Amazon, eBay, LinkedIn, Facebook and AOL. According to the report, no other company was “coming close to achieving [Google’s] status as an endemic threat to privacy.” What most disturbed the authors was Google’s “increasing ability to deep-drill into the minutiae of a user’s life and lifestyle choices.” The result: “the most onerous privacy environment on the Internet.” Indeed, Google now controls an estimated 70 per cent of the online search engine market, but its deep-drilling of user information – where we surf, whom we e-mail, what blogs we post, what pictures we share, what maps we look at, what news we read – extends far beyond the search feature to encompass the kind of “total information awareness” that privacy activists feared at the hands of the Bush Jr. administration’s much-maligned Total Information Awareness program.

Kevin Bankston, a privacy expert and attorney at the Electronic Frontier Foundation, a nonprofit advocacy group engaged in questions of privacy, free speech, and intellectual property in the digital age, warns of the possibilities. “In all of human history,” he says, “few if any single entities, other than the National Security Agency, have ever possessed such a hoard of sensitive data about so many people.” This is the sort of thing that should make the intelligence agencies, says Bankston, “drool with anticipation.” And drooling they are. Stephen Arnold, an IT expert who formerly worked at the defense and intelligence contractor Booz Allen Hamilton Inc. and who once consulted for Google, addressed this in a speech before a conference of current and former intelligence officials in Washington, D.C., in January 2006. According to an audio recording in our possession, he reported Google was increasingly sought out by the U.S. intelligence services because click-stream data – and everything else Google archives – “is a tremendous opportunity for the intelligence community.” Google, he said, “has figured out everything there is to know about data-collection.” The relationship with the government had become intimate enough, Arnold said, that at least three officers from “an unnamed intelligence agency” had been posted at Google’s headquarters in Mountain View, Calif.

What they are doing there, Arnold did not reveal.

“We don’t comment on rumor or speculation,” said Google spokesperson Christine Chen. When asked separately how many former intelligence agency officials work at Google, she responded, “We don’t release personnel information.”

The conference, under the aegis of the Open Source Solutions Network, was hosted and organized by Robert David Steele, a former Central Intelligence Agency officer who left the agency 20 years ago and is now the founder and CEO of Open Source Solutions Network Inc., otherwise known as OSS.Net, an educational corporation that has worked with more than 50 governments to “advance the use of open source intelligence.” Steele considered Arnold’s item to be a bombshell. U.S. intel was now seated in the heart of the “Googleplex,” learning all it could from the masters in the private sector. Among Google’s critics, Steele who, since leaving the CIA, has spent 20 years promoting the digital commons, is about as fierce as they come. “Google would have been an absolutely precious gift to humanity,” he says. “But Google is positioning itself to take over the digital commons. I personally have resolved that unless Google comes clean with the public, the company is now evil.” The question today is whether Google, in fact, will be forced to change its ways – and whether Congress and the intelligence agencies want it to.

Google’s powers of data-collection depend on consumer choice – how much of your computing you put in Google’s hands. The more you choose Google applications, the more Google can know about you. At the extreme end of the spectrum, your every move can be tracked by some feature of Google. When you use the Google search box, as tens of millions of people do daily (with Google handling roughly 11,000 searches per second), the company can track all your search queries and the websites you visit as a result of those queries. If you use Google toolbar, the company can watch the amount of time you surf a website – the three minutes or three hours you spend on every page of that website. With Google’s acquisition of YouTube in 2006, viewing habits can be tracked. Google’s FriendConnect and Orkut archive your social networks. Google News, Books, Feedburner or Blogger log your reading habits. The writing you produce is stored on Google Docs, and your purchase habits and credit card numbers are captured by Google Checkout. Also gathered are voiceprint and call habits, through Google Voice; travel interests, patterns and place associations, through Google Maps, Google Earth and Google StreetView; medical conditions, medical history and prescription drug use, through Google Health; photos of friends and family, through Google’s Picassa images; and general activities, through Google Calendar. Then, there’s Google Desktop, which, at one point, offered what appeared to be an innocuous feature called “Search Across Computers.” This allowed Google to scan your computer to archive copies of text documents. In other words, just about everything on your PC – love letters, tax returns, business records, bad poetry – was duplicated on a remote Google server. (This function was discontinued on all platforms in January of this year.)

Taken alone, the Google search box is an exquisitely intimate repository of user information. “People treat the search box like their most trusted advisors,” says Kevin Bankston, the Electronic Frontier Foundation (EFF) attorney. “They tell the Google search box what they wouldn’t tell their own mother, spouse, shrink or priest.” Think about your most recent queries, say, about your “anal warts” or “inability to love in marriage,” or “self-hatred,” or your interest in the mechanics of “making a pipe bomb.” The search box is as good a place as any to understand how the Googleplex keeps tabs on its users. When you do a search, “cookies” installed on your computer record your IP address (a series of unique numbers that may be used to identify your computer), so Google can, in many contexts, identify a user. And it can do so with any of its applications.

All this, one would think, ceases once your PC is shut down and you leave home. However, Google released a “geo-location” application in 2008, Gears Geolocation API, that can “obtain the user’s current position,” “watch the user’s position as it changes over time,” and “quickly and cheaply obtain the user’s last known position.” According to a Google tech blog, the Gears application “can determine your location using nearby cell-towers or GPS for your mobile device or your computer’s IP address for your laptop.” A 2006 Technology Review article reports that Google’s director of research, Peter Norvig, even proposed the use of built-in microphones on PCs to identify television shows playing in the room, in order to display related advertising. Such data, it seems, could be processed as an audio fingerprint, which might aid in geolocation and profiling of users. (“Google had no plans to develop this,” Google spokesperson Christine Chen responded by e-mail. “And we haven’t.”)

Google’s data-mining interests go even deeper, to the core of our physical and mental being. Google co-founder Sergey Brin and his biotech specialist wife, Anne Wojcicki, according to The Economist, have “brainstormed” with at least one prominent human genome researcher and approach genetics as a “database and computing problem.” This would tie in nicely with Google Health, launched in 2008 to take advantage of the growing trend of storing health records online, for easier access among diverse health care providers. Google has invested $3.9 million in Wojcicki’s biotech firm, 23andMe, whose “mission is to be the world’s trusted source of personal genetic information,” and which offers a basket of genetic tests to allow its customers to uncover ancestry, disease risks, and drug responses. Speaking before a Google “Zeitgeist” conference in 2008, Brin revealed that he carried a Parkinson’s gene and then advocated the recording of individual genetic codes to enhance health maintenance and medical research. Taken to its logical conclusion, this suggests the prospect of your body’s blueprint registered with an eventual “Google Genome,” perhaps with the help of the databases gathered at 23andMe. To drill further into the mind, Google has teamed up with marketing giant WPP to fund $4.6 million for research into online advertising, including one grant in the emerging field of “neuromarketing”: tracking everything from online navigation behavior to biofeedback metrics like heart rate, eye movement and brain wave activity in response to advertising stimuli. Google’s Chen points out that the results of this research will be available to industry as a whole and that “Google has no special right over, nor plans to use, any of the research funded by these grants.”...

"Whole Foods Would Look a Lot Different If It Were Science-Based" (WFM)

After flatlining around $30 since late 2015 the stock seems to have been anticipating something the last six weeks:
From New York Magazine's Science of Us:
Whole Foods used to be my idea of grocery heaven. Once upon a time, I shopped at the California Street location in San Francisco — it was light and airy with produce for miles. I knew the cheesemonger. I had philosophical conversations with the butcher. I stared longingly at the Le Creuset bakeware. The soap aisle smelled like lavender. Heaven.

But eventually, I fell out of love. Or, to be more specific, I changed my mind about organic food after reading the research: It turns out organic isn’t more nutritious or even necessarily better for the planet. So I pretty much stopped shopping at Whole Foods altogether.

I’m not the only one. Whole Foods may have once revolutionized the organic-food industry, but it’s no longer the only game in town. These days, many consumers are now buying their organic groceries at less expensive stores, including Costco and Walmart. Whole Foods’ sales are on the decline, driving many observers and even their own investors to suggest that in order to survive, the chain has to make a drastic change.

Well. I have a suggestion as to what that change might be. It’s pretty drastic, but, hear me out, Whole Foods. This could be good for both of us. Here it is: Why not revolutionize grocery shopping all over again? Only this time, the revolution should be powered by science and agronomy, and not misleading marketing.

Here’s my first problem. Labels like “organic” and “conventional” are too broad, and too black and white, to really be all that helpful. A more specific, more informative approach could fix this: If Whole Foods listed all of the pesticides used on every fruit and vegetable, whether natural or synthetic, consumers might begin to understand that both conventional and organic produce are grown with pesticides, and what matters more is the toxicity of the pesticide used. Copper sulfate, for example, a pesticide allowed in organic produce in the U.S., is more toxic than some conventional pesticides.
Chlorpyrifos, an insecticide used in conventional agriculture, is more toxic than glyphosate, the active ingredient in the herbicide Roundup. It’s worth noting that Whole Foods took a step in this direction once before with its Responsibly Grown program, which recognized that conventional produce can be more sustainable than organic, but organic farmers loudly objected and the company eventually undercut those standards. It’s time to bring them back.

This new science-based labeling system should also make it crystal clear that trace pesticide residues aren’t dangerous for consumers — as long as the residues measure below the tolerance levels set by the U.S. Environmental Protection Agency (and they do, year after year), then they aren’t a cause for concern. If there is a concern about a pesticide’s toxicity, it’s the health risk to farm workers and their families, and that’s something to consider before buying those perfect-looking strawberries.
We’ll also want to know the pesticide’s environmental impact, like how it affects the bees or the surrounding water supply. Many people believe pesticides alone are killing off the country’s bee population, but if you dig a little deeper, you discover that pesticides aren’t actually the biggest culprit. Iida Ruishalme, a biologist who writes the blog Thoughtscapism, has published several in-depth posts examining the different hazards to bee health. She says even though “neonicotinoid [pesticides] steal most of the thunder,” there are graver threats to be concerned with: “The Varroa mite, disease, habitat loss, and invasive species (such as the European honey bee itself) play a far greater role.”

But pesticides are only one piece of the broader sustainability puzzle. Consumers should also be able to know whether the farmer who grew their produce uses practices like cover-cropping and conservation tillage, two things that improve soil health and mitigate the impact of climate change by increasing the sequestration of carbon in the soil. Both organic and conventional farmers can and do incorporate these methods....MUCH MORE
It won't happen of course. Here's Bloomberg on one of the reasons why: 

The Future of Whole Foods Isn’t About Groceries
  • CEO Mackey tries to boost profits without losing brand cachet
  • Wall Street grows restless after almost two-year sales slump
Inside the Whole Foods Market in midtown Manhattan at lunchtime, it’s easy to forget that the organic supermarket chain is suffering its biggest crisis since going public in 1992.

A line 20-people deep waits at a juice and espresso bar near the bustling store entrance across from Bryant Park. In the food hall upstairs, the tables are packed with customers noshing on superfood salads and sushi. Too harried to stop for oysters, many shoppers order Nashville-style fried chicken sandwiches from digital kiosks and sample cold brew from Stumptown Coffee Roasters.

Whole Foods Market Inc., facing pressure from restless shareholders after nearly two years of sliding sales, still has cachet in New York and other pockets of the U.S. That unique foodie appeal is key to a turnaround if Chief Executive Officer John Mackey is able to improve operations, said Charles Kantor, a managing director at Neuberger Berman, one of the grocery chain’s 10 biggest investors. 
“He got all the hard things right over the years, but he didn’t get the easy stuff right,” Kantor said. “There hasn’t been laserlike focus in a long time.”

As grocers fight for traffic amid an intense price war and the threat of e-commerce, Whole Foods stands out among its peers with its prepared foods and in-house restaurants that make its stores destinations. The challenge for Mackey, who co-founded the company in 1980, is how to assuage Wall Street by boosting profits without ruining what made Whole Foods wildly popular in the first place.

“They have to do two things at the same time that are diametrically opposed,” said Roger Davidson, a former Wal-Mart grocery executive who works as a consultant. “They have to make sure they don’t dumb it down.”

Brand Loyalty
The hubbub at newer Whole Foods locations like the one in midtown Manhattan illustrates a brand loyalty that most retailers would envy, especially when brick-and-mortar stores are closing at a record pace. Neuberger Berman increased its stake in the company in 2015 because of its rare ability to “connect in an emotional way” with shoppers, said Kantor. The firm owns about 2.7 percent of Whole Foods shares, according to data compiled by Bloomberg....MUCH MORE

Agriculture: Agrimoney LIVE Conference--Diary

This is Monday's blog, Tuesday after the jump. Pics here.

Agrimoney LIVE as it happens - day one conference diary
8.45am The conference has not kicked off proper, and already Agrimoney LIVE has a (minor) scoop – that one of the major speakers used to be a motorbiking fiend, and indeed rode a Honda around the UK in 1981, reaching Land's End.
He (it is a he, and not a UK national) still has a moped.
Which speaker? Guesses (and other comments) to 
11.06am India, Africa trump China
Is China really such a big, and positive, theme for commodities and agriculture?
Many observers seem to think so. But Erik Norland, senior economist at CME Group, takes a more jaundiced view.
"A further slowdown in the Chinese economist will likely negatively impact commodity prices, including iron ore, of which China consumers two thirds of the world supply," he says.
"This in turn could put downward pressure on the economics of commodity-producing nations like Australia."
In ags, the zeitgeist is "no longer going to be about China.
"India looks very interesting. And Africa is going to huge population growth."
11: 37am 'Scary sugar short'
Agricultural commodities are a boon for momentum traders, says Fiona Boal, director, commodities at Fulcrum Asset Management.
This is because of the lag between markets signalling a supply imbalance, and producers' being able to respond by raising or lowering output.
"It needs time for higher prices to work back to production," or for lower prices to turn the supply taps down, Ms Boal says.
"This makes agricultural markets are particularly well suited to momentum strategies."
The "scary" shorting for instance, in sugar, prices of which have tumbled on expectations of a potential return to a production surplus ahead, has produced "positive" results, she says.
12:18 Weather outlook
Lots of interesting snippets from Kyle Tapley, of MDA Weather Services.
On El Nino, it looks like if one does develop this year, it will be a weak one, and will "probably come too late to have a big impact on northern hemisphere growing conditions", he says.
That is not necessarily a positive for northern hemisphere farmers, given that El Nino gives a 4.2% boost to US corn yields, compared with trend, and a 3.3% lift to soybean yields, on MDA estimates. (It is La Nina which is the danger to the Corn Belt.)
Indeed, the US looks set this summer for "widespread above-normal temperatures that could lead to heat stress", with dryness looking an issue for the southern Plains and southern Midwest.
…but not that much of an issue. MDA sees the US corn yield coming in at a very respectable 170.8 bushels per acres this year, and the soybean yield at 49.0 bushels per acre.
Where Mr Tapley sees a bigger threat is to the Black Sea, where dry conditions in the summer may "stress corn and sunflowers", but likely come too late to affect wheat potential.
In Europe too, "dry weather this summer in Spain, Romania, and Bulgaria may stress corn and sunflowers", with – importantly – France, the bloc's most important corn grower, being mentioned in dispatches too.
13.55 'Fake' beef strides ahead
Synthetic proteins are a bigger threat to the meat industry than the growing popularity of vegan diets.
According to Marc Sadler from the World Bank, the main issue with synthetic proteins has been their texture.
"This has always been the issue with meat substitutes, as 60-70% of the experience of eating is to do with texture.
"Some companies are breaking through - in their blind tastings it has been impossible to tell the difference between real and synthetic meat."
14.30 'Spend more on tech'
More money needs to be spend on developing artificial intelligence in agriculture, said Arnaud Petit, director commodities and trade at farmer co-operative body Copa-Cogeca.
Speaking at a session at Agrimoney LIVE he said farmers already had technology which could tell them how much fertiliser to apply or where to apply pesticides, but that they needed something which connected all of these and provided interlinked advice.
He also talked of big losses in winter grains in northern Europe (Scandinavia) – maybe 20%. Copa Cogeca will produce quarterly estimates in a few weeks' time....MORE
Agrimoney LIVE as it happens - day two conference diary

09:00 What to make of Glencore approach to Bunge?
For some reason, big news in ag always breaks when Agrimoney is having a conference.
This time, it is Glencore's revelation that its part-owned ag division has made an "informal approach" to trading giant Bunge. (What made it informal? Were the Glencore suitors not wearing ties?)
To one senior delegate at Agrimoney LIVE, this looks like the latest episode in the consolidation wave that started in seeds and chemicals, with the rash of tie-ups with DuPont-Dow, ChemChina-Syngenta, Bayer-Monsanto and BASF, um…
And could it be a sign that the ag sector is on the up again?
"It looks a sign that sector valuations are attractive, if there is all this consolidation going on," the delegate says, flagging the dent to profits in sector from the decline in crop prices.
There is more on sector M&A scheduled in the Agrimoney LIVE programme. Stay tuned....