Yemeni Houthis Are Attacking Commercial Ships in the Red Sea

Published

11 months ago

December 21, 2023

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You’ve heard of the Grinch, but what about the Houthis? Yemeni Houthis, who are backed by Iran, have been targeting massive ships in the Red Sea with drones and missiles since the October 7 Hamas attack on Israel. Now, a bunch of shipping companies like Maerskwhich had a ship attacked by Houthis last weekare avoiding the Suez Canal and diverting their ships around Africa via the Cape of Good Hope.

“Following the near-miss incident involving Maersk Gibraltar” last Thursday “and yet another attack on a container vessel” one day later, “we have instructed all Maersk vessels in the area bound to pass through the Bab al-Mandab Strait to pause their journey until further notice,” reads a press release from the company.

“As Israel ramped up its retaliation for the attack, the Houthis began targeting ships that it accused of in some way support Israel’s war effort,” reports CNN, “though multiple companies that have been targeted have said they have no connection with Israel or the war.”

The Houthis have launched more than 100 attacks on a dozen commercial vessels over the last month. This hasn’t happened at this scale in more than two decades, an American military official told CNN. Now, the Pentagon is assembling a security initiative alongside allied countries to attempt to secure the trade routes.

“About 50 vessels go through the Suez Canal a day, and recent data suggested that, as of Monday, at least 32 had been diverted, said Chris Rogers, head of supply chain research at S&P Global Market Intelligence,” per The New York Times.Another analyst called the situation “a slow-burning disaster.” In other words: Houthis are threatening the supply chain in a major wayroughly 12 percent of global shipping traffic goes through the Suez Canaland, well, if your Christmas packages don’t get here in time, it’s possibly the Houthi militants’ fault.

The oil angle:Because of this unfolding crisis, BP has stopped sending ships through the Red Sea. But rerouting oil tankers will impose additional costs likely to have ripple effects. “Brent crude, the international oil benchmark, has risen about 8 percent since mid-December, to above $79 a barrel,” reportsThe New York Times. “But the move has only partly reversed a monthslong slide in the price of oil, which hovered above $90 a barrel in September and early October.”

The Red Sea disruption is an especially big problem right now because both Russian sanctions and the war in Ukraine mean Europe depends on Middle Eastern and Asian oil to a greater degree than in years prior. Bypassing the Suez Canal and going around the Cape of Good Hope tends to raise crude oil prices by nearly $4 a barrel, Goldman Sachs analysts predict.

In some ways, pandemic supply chain snarlsand their quick resolutionshave taught us that supply chains are more resilient than we had once feared. But in other waysAmerican reliance on Taiwanese semiconductor manufacturing, for one, which could all go to shit if China at some point tries to seize Taiwanwe’ve found ourselves vulnerable. This bizarre situation playing out in the Red Sea might not drive oil and gas prices up too drastically, all on its own, but when piled on to the pain Americans are feeling from sky-high inflation, it’s surely unwelcome.

Colorado screws us all saves democracy:Colorado’s Supreme Court ruled late last night that Donald Trump is not eligible to seek the presidency under Section 3 of the 14th Amendment, which prohibits those who have engaged “in insurrection or rebellion against” the government from holding office, which means his name will be removed from the state’s Republican primary ballot.

The “provision [was] originally intended to restrain former Confederates from seeking office after the Civil War,” writes Reason’s Eric Boehm. But late last night, “in a 43 ruling, the Colorado high court determined that Trump’s role in instigating the January 6 riot at the U.S. Capitol was sufficient to bar him from the presidency.” Note that Trump has been convicted of no insurrection-related crimes.

The ruling will probably be appealed to the Supreme Court but, in short, the outcome probably won’t be pretty. The opinion of the Colorado Supreme Court is shameful and runs completely counter to our constitutional system.

Donald Trump was not removed from office by Congress for engaging in insurrection.

Donald Trump has not been criminally convicted in a court of law of engaging in…

— Justin Amash (@justinamash) December 20, 2023

Just finished reading the Colorado Supreme Court ruling, and I wholly concur with Justin’s view. The opinion is wrongheaded in the main and sloppy in specifics. The Supreme Court will undoubtedly overturn, but the damage from this corrosive folly will linger. (1/4) https://t.co/ZJ9tlD8xQL

— Peter Meijer (@RepMeijer) December 20, 2023

I continue to believe that Trump’s liability for January 6th is political, and efforts to bend the law and loosen interpretations to force accountability into the legal realm will be more damaging in the long-term than whatever his opponents think they are preventing. (4/4)

— Peter Meijer (@RepMeijer) December 20, 2023

Scenes from New York: Eric Adams gives the worst answer any politician has ever given to a soft ball question. pic.twitter.com/sYL3cj5yCf

— Tim Miller (@Timodc) December 18, 2023

“New York… This is a place where every day you wake up, you could experience everything from a plane crashing into our Trade Center to a person who’s celebrating a new business that’s opening. This is a very, very complicated city and that’s why it’s the greatest city on the globe.” QUICK HITS This is beautiful and insightful, on the joy of having children as well as how we ought to look at the current fertility crisis, by Alex Nowrasteh in Quillette. A paper company in Guangdong, China, is saying that “employees need to clock 62 miles every month if they want to get an annual bonus worth 130% of their monthly salary,” and that they will be eligible for “an annual bonus equivalent to a month’s salary if they ran 31 miles every month.” New episode ofEconTalk from Russ Roberts (who was recently a Just Asking Questionsguest, back before the rebrand) and Haviv Rettig Gur on the origins of Israel and the conflict in the Middle East. More tax trouble for members of the Biden family, who can’t seem to figure out how to pay the IRS what they owe. Unacceptable bullying from Sen. Elizabeth Warren (DMass.): Coin Center received the same impertinent letter from Elizabeth Warren as the BA and Coinbase. Read it for yourself to see what a bullying publicity stunt it is. pic.twitter.com/YF3SFQ8rqh

— Jerry Brito (@jerrybrito) December 19, 2023

Minnesota Timberwolves player Anthony Edwards made headlines this week because he allegedly wired a model $100,000 to pay for her abortion and sent texts that made clear what he wanted her to do. “Hell Nawl can’t do dis,” say the texts, as well as the oh-so-eloquent “get an abortion lol.” After these texts were made public by the New York Post, he released a statement: “I made comments in the heat of a moment that are not me, and that are not aligned with what I believe and who I want to be as a man. All women should be supported and empowered to make their own decisions about their bodies and what is best for them.” You see, one is supposed to use the verbiage of the second statement, not the first, in polite society. (The actual morality of the baby-aborting doesn’t seem widely disputed in this case, just the way he talked about it.) Yes: I hear this often: “There’s no way that the work of a CEO is worth 300x that of their average employee.”

But this isn’t the sort of thing you can know from the armchair. It’s like asserting that there’s no way that a gram of plutonium is worth 3,000x a cup of coffee. https://t.co/qTWkrwYktT

— Chris Freiman (@cafreiman) December 19, 2023

“Today, the lifeblood of Southern California’s tech scene is charged by an unapologetically optimistic pack of engineers, machinists, and entrepreneurs building at the frontier of atoms-based technoloy,” writes Founders Fund’s Scott Nolan forPirate Wires on El Segundo’s tech scene.

Sports

CFP Anger Index: Better call Paul — the committee is disrespecting the SEC

Published

3 hours ago

November 13, 2024

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CFP Anger Index: Better call Paul -- the committee is disrespecting the SEC

David Hale, ESPN Staff WriterNov 12, 2024, 09:05 PM ET
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- College football reporter.
- Joined ESPN in 2012.
- Graduate of the University of Delaware.

The committee has released its second crack at the top 25, and it’s (almost) all Big Ten at the top.

That might seem a bit strange to the conference that boasts the most playoff-caliber teams and the most nonconference wins against other Power 4 leagues, and also has Paul Finebaum there to remind everyone just how angry they should be at this affront to good judgment.

With that, we’ll handle much of Finebaum’s homework for him. Here’s this week’s Anger Index.

1. The SEC

Eleven weeks into the 2024 season, and one thing seems abundantly clear: The SEC is the best conference in college football. Take a look at Bill Connelly’s SP+ rankings, for example, where nine of the top 17 teams are from the SEC. Or use ESPN’s FPI metric, where the SEC has spots 1, 2, 4, 5 and 9. Consider that the team currently ninth in the SEC standings, South Carolina, has three wins over SP+ top-40 teams and losses to the committee’s No. 10 and 22 teams by a combined total of five points.

Yes, the SEC’s dominance and depth seem obvious.

So, of course, four of the top five teams in the committee’s rankings this week are from the SEC.

Wait, no, sorry about that. We’re getting late word here that, in fact, it’s the Big Ten with teams No. 1, 2, 4 and 5 in this week’s rankings.

It’s not that those four Big Ten teams aren’t any good. Oregon (No. 1) has chewed up and spit out nearly all comers this season. Ohio State (No. 2) is the best squad the gross domestic product of Estonia can buy. Penn State (No. 4), well, the Nittany Lions still haven’t beaten Ohio State, but we assume the rest of the résumé is OK. Indiana (No. 5) is blowing the doors off people.

But that’s it. The rest of the Big Ten is a mess. You need a magnifying glass to find Michigan‘s QB production. Iowa finally learned how to score and somehow has gotten worse. Minnesota looked like the next-best team in the conference, and the Gophers have losses to North Carolina and Rutgers.

A lack of depth does not inherently mean the teams at the top are not elite. Indeed, the other teams in any conference remain independent variables when addressing the ceiling for any one team. If the Kansas City Chiefs joined the Sun Belt, Patrick Mahomes would still be a magician and Andy Reid would still be saying “Bundle-a-rooskie-doo” in your nightmares.

But the cold, hard facts are these: Indiana’s best win came last week against Michigan (No. 40 in SP+) by 3. Penn State’s best win (by SP+) came by 3 against a below-.500 USC team that just benched its QB. Ohio State is absolutely elite on paper, but on the field, the Buckeyes’ success is entirely buoyed by a 20-13 win at Penn State, a team we also know very little about.

The SEC gets flack for boasting of its greatness routinely, and to be sure, that narrative has often bolstered less-than-elite teams. But this year, every reasonable metric suggests the SEC’s production actually matches its ego, and when Ole Miss (No. 11), Georgia (No. 12), Alabama (No. 10) and Texas A&M (No. 15) — all with two losses — are dogged as a result of playing in a league where every other team warrants a spot in the top 25, it undermines the entire point of having a committee that can use its judgment rather than simply look at the standings.

Let’s compare two teams with blind résumés.

Team A: 8-1 record, No. 14 in ESPN’s strength of record. Best win came vs. SP+ No. 20, loss came to a top-10 team by 3. Has four wins vs. Power 4 teams with a winning record, by an average of 14 points.

Team B: 8-1 record, No. 11 in ESPN’s strength of record. Best win came vs. SP+ No. 28, loss came to a top-15 team by 15. Has one win vs. a Power 4 team with a winning record, by 3.

So, which team has the better résumé?

This shouldn’t take too long to figure out. Team A looks better by almost every metric, right?

Well, Team A is SMU, who checks in at No. 14 in this week’s ranking.

Team B, though? That’d be the Mustangs’ old friends from the Southwest Conference, the Texas Longhorns. Texas checks in at No. 3.

Perhaps you’ve watched enough of both Texas and SMU to think the eye test favors the Longhorns. That’s fair. But should the eye test account for 11 spots in the rankings? At some point, the results have to matter more.

Or, perhaps it’s the brand that matters to the committee. If that same résumé belonged to a school that hadn’t just bought its way into the Power 4 this year, it’s hard to imagine they wouldn’t be in the top 10 with ease.

Let’s dig into three different teams still hoping for a playoff bid, even if the odds are against them at this point.

Team A: 7-2, 1 win over SP+ top 40. No. 28 in ESPN’s strength of record. Losses by a combined 18 points.

Team B: 7-2, 1 win over SP+ top 40. No. 25 in ESPN’s strength of record. Losses by a combined 13 points.

Team C: 7-2, no wins over SP+ top 40. No. 24 in ESPN’s strength of record. Losses by a combined 21 points.

You could split hairs here, but the bottom line is none has a particularly compelling résumé, and they’re all pretty similar.

So, who are they?

Team B is Iowa State, which plummeted from the rankings after losing two straight. But the committee isn’t supposed to care when you lost your games. Losing in September is not better than losing in November. At least that’s what they say.

Team A is Arizona State. Its 10-point loss to Cincinnati came without starting QB Sam Leavitt and was due, at least in part, to a kicking game so traumatic head coach Kenny Dillingham held an open tryout afterward. The Sun Devils and Cyclones are two of three two-loss Power 4 teams unranked this week (alongside Pitt), but unlike Iowa State and Pitt, Arizona State isn’t coming off back-to-back losses. The Sun Devils’ absence seems entirely correlated to the fact that no one believed this team would be any good entering the season, and so few people have looked closely enough to change their minds that the committee feels comfortable ignoring them.

The team the committee can’t ignore, however, is Team C. That would be Colorado. Coach Prime has convinced the world the Buffaloes are for real, even if nothing on their résumé — a No. 77 strength of schedule, worse than 7-2 Western Kentucky‘s — suggests that’s anything close to a certainty.

The Big 12 remains wide open, but it’s to the committee’s detriment that it has so eagerly dismissed two of the better teams just because they’re not as fun to talk about.

Has Missouri played with fire this year? You betcha. Just last week, the Tigers were on the verge of falling to Oklahoma before the Sooners’ woeful QB situation reared its ugly head again and the game ended in a 30-23 Tigers win.

But here’s the thing about playing with fire: So long as you don’t turn your living room into an inferno, it’s actually pretty impressive.

Missouri is 7-2 with wins against SP+ Nos. 26 and 28, and its only losses are to the committee’s No. 10 and No. 15 teams. SP+ has Missouri at No. 17, though we can chalk that up to Connelly’s hometown bias. But No. 23? After a top-10 season in 2023, don’t the Tigers deserve a little benefit of the doubt? They currently trail three three-loss teams (Louisville, South Carolina and LSU) and are behind Boise State, Colorado, Washington State and Clemson, who, combined, have exactly one win over SP+ top-40 teams.

There’s a good chance that, should Brady Cook not return to the lineup, Missouri will get waxed at South Carolina on Saturday, and then the argument is moot. But the committee isn’t supposed to look ahead and take guesses at what it believes might happen (Florida State’s snub last year notwithstanding). It’s supposed to judge based on what’s on the books so far, and putting Missouri this far down the rankings seems more than a tad harsh.

The committee threw a nice bone to the non-Power 4 schools this week, with four teams ranked, including No. 25 Tulane Green Wave. That seems deserved, given Tulane’s recent run. But what is it, exactly, that puts the Green Wave ahead of UNLV?

UNLV has the No. 31 strength of record. Tulane is No. 32.

UNLV has the No. 98 strength of schedule played. Tulane is No. 96.

Tulane has a one-possession loss to a top-20 team. UNLV has a one-possession loss to a top-20 team.

The key difference between the two is UNLV has wins against two Power 4 opponents — Houston and Kansas. Houston, by the way, just knocked off Kansas State, a team that beat Tulane.

So perhaps the committee should spread a bit more love outside the Power 4.

Also Angry: Pittsburgh Panthers (7-2, unranked), Duke Blue Devils (7-3, unranked), Georgia Bulldogs (7-2, No. 12), Utah Utes AD Mark Harlan (the Utes would be ranked if Big 12 Commissioner Brett Yormark hadn’t rigged the system!) and UConn Huskies (7-3, unranked and thus prohibiting us from Jim Mora Jr. giving a “You wanna talk about playoffs?!?” rant).

Environment

Elon Musk Tapped to Lead New ‘DOGE’ Department—Despite the Government Already Having One for Efficiency

Published

3 hours ago

November 13, 2024

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Elon Musk Tapped to Lead New ‘DOGE’ Department—Despite the Government Already Having One for Efficiency

Tesla CEO Elon Musk is to officially join Trump’s administration as the co-head of the new US Department of Government Efficiency – a second federal department with the goal of making government spending more efficient.

You can’t get more ironic than that.

Throughout the elections, Musk, who is already CEO of Tesla, and SpaceX, a well as the defacto head of X, xAI, Neuralink, and the Boring Company, has been floating the idea to add to his workload by joining the Trump’s administration to lead a new department aimed at making the federal government more efficient.

He has been calling it the “Department of Government Efficiency”, which spells out ‘DOGE’, a meme that Musk appears to enjoy.

Well, now Trump appears to want to be going through with this idea.

He announced the new department and Musk as head, along with Vivek Ramaswamy, in a statement today:

I am pleased to announce that the Great Elon Musk, working in conjunction with American Patriot Vivek Ramaswamy, will lead the Department of Government Efficiency (“DOGE”). Together, these two wonderful Americans will pave the way for my Administration to dismantle Government Bureaucracy, slash excess regulations, cut wasteful expenditures, and restructure Federal Agencies – Essential to the “Save America” Movement. “This will send shockwaves through the system, and anyone involved in Government waste, which is a lot of people!” stated Mr. Musk.

What’s most ironic is that there’s already a federal department with the goal of cutting government waste and ensuring efficiency: the Government Accountability Office (GAO).

The GAO’s main objectives are:

auditing agency operations to determine whether federal funds are being spent efficiently and effectively;
investigating allegations of illegal and improper activities;
reporting on how well government programs and policies are meeting their objectives;
performing policy analyses and outlining options for congressional consideration;
issuing legal decisions and opinions;
advising Congress and the heads of executive agencies about ways to make government more efficient and effective

It sounds similar to what Musk described when talking about his DOGE, but Trump hasn’t gone into many details other than it will “cut waste.”

He also has a confusing message as he compares the initiative, which is supposed to cut government spending, to “The Manhattan project”, a massive and expensive government project.

Trump said that DOGE will help the government “drive large scale structural reform”:

It will become, potentially, “The Manhattan Project” of our time. Republican politicians have dreamed about the objectives of “DOGE” for a very long time. To drive this kind of drastic change, the Department of Government Efficiency will provide advice and guidance from outside of Government, and will partner with the White House and Office of Management & Budget to drive large scale structural reform, and create an entrepreneurial approach to Government never seen before.

The statement also noted that DOGE will only operate until July 4, 2026.

Musk has previously claimed that he could cut at least $2 trillion dollars of the $6.5 trillion dollar US federal budget.

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Environment

Oil could plunge to $40 in 2025 if OPEC unwinds voluntary production cuts, analysts say

Published

4 hours ago

November 13, 2024

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Oil could plunge to in 2025 if OPEC unwinds voluntary production cuts, analysts say

A pump jack in Midland, Texas, US, on Thursday, Oct. 3, 2024.

Anthony Prieto | Bloomberg | Getty Images

Oil prices may see a drastic fall in the event that oil alliance OPEC+ unwinds its existing output cuts, said market watchers who are predicting a bearish year ahead for crude.

“There is more fear about 2025’s oil prices than there has been since years — any year I can remember, since the Arab Spring,” said Tom Kloza, global head of energy analysis at OPIS, an oil price reporting agency.

“You could get down to $30 or $40 a barrel if OPEC unwound and didn’t have any kind of real agreement to rein in production. They’ve seen their market share really dwindle through the years,” Kloza added.

A decline to $40 a barrel would mean around a 40% erasure of current crude prices. Global benchmark Brent is currently trading at $72 a barrel, while U.S. West Texas Intermediate futures are around $68 per barrel.

Oil prices year-to-date

Given that oil demand growth next year probably won’t be much more than 1 million barrels a day, a full unwinding of OPEC+ supply cuts in 2025 would “undoubtedly see a very steep slide in crude prices, possibly toward $40 a barrel,” Henning Gloystein, head of energy, climate and resources at Eurasia Group, told CNBC.

Similarly, MST Marquee’s senior energy analyst Saul Kavonic posited that should OPEC+ unwind cuts without regard to demand, it would “effectively amount to a price war over market share that could send oil to lows not seen since Covid.”

However, the alliance is more likely to opt for a gradual unwinding early next year, compared to a full scale and immediate one, the analysts said.

Should the producers group proceed with their production plan, the market surplus could nearly double.

Martoccia Francesco

Energy strategist at Citi

The oil cartel has been exercising discipline in maintaining its voluntary output cuts, to the point of extending them.

In September, OPEC+ postponed plans to begin gradually rolling back on the 2.2 million barrels per day of voluntary cuts by two months in an effort to stem the slide of oil prices. The 2.2 million bpd cut, which was implemented over the second and third quarters, had been due to expire at the end of September.

At the start of this month, the oil cartel again decided to delay the planned oil output increase by another month to the end of December.

Oil prices have been weighed by a sluggish post-Covid recovery in demand from China, the world’s second-largest economy and leading crude oil importer. In its monthly report released Tuesday, OPEC lowered its 2025 global oil demand growth forecast from 1.6 million barrels per day to 1.5 million barrels per day.

The pressured prices were also conflagrated by a perceivably oversupplied market, especially as key oil producers outside the OPEC alliance like the U.S., Canada, Guyana and Brazil are also planning to add supply, Gloystein highlighted.

Bearish year ahead for oil

The market consensus is that there’ll be a “substantial” oil stock build next year, said Citibank energy strategist Martoccia Francesco.

“Should the producers group proceed with their production plan, the market surplus could nearly double… reaching as much as 1.6 million barrels per day,” said Francesco.

Even if OPEC+ doesn’t unwind the cuts, the future ofl prices is still looking break. Citi analysts expect Brent price to average $60 per barrel next year.

Further fueling the bearish outlook is the incoming administration of U.S. President-elect Donald Trump, whose return is associated by some with a potential trade war, said analysts who spoke to CNBC.

“If we do get a trade war — and a lot of economists think that a trade war is possible, and particularly against China — we could see much, much lower prices,” said OPIS’ Kloza.

Trump has also touted a “drill baby drill” policy for U.S. producers, vowing to cut energy prices in half.

For that to happen to retail gasoline prices, oil would need to drop to “below $40” per barrel, said Matt Smith, Kpler’s lead oil analyst.

Right now, retail gasoline prices are at a “sweet spot” at $3 per gallon, where consumers do not feel the pinch and input prices are still sufficiently high for producers, Smith added.