TEPCO reported on May 23 that the Reactors 2 and 3 at Fukushima I Nuclear Power Plant had a core meltdown just like the Reactor 1, based on their analysis on the reactor parameters right after the earthquake on March 11.
The company will submit the report to METI's Nuclear and Industrial Safety Agency.
報告書では、２、３号機について〈１〉炉内の水位が水位計の表示通りだった〈２〉水位計のデータは信頼できず、１号機と同じ様に核燃料が全露出し ている――の二つのケースに分けて、模擬計算を行い、結果を示した。それによると、いずれの場合にも核燃料が溶融して、原子炉圧力容器底部に崩落した状態 になっていると評価。特に、水位計が故障しているケースでは、核燃料全体が溶融して、崩壊しているとした。
In the report, TEPCO did two simulations regarding the Reactors 2 and 3: 1st, based on the assumption that the water level was what the water gauge had been showing all along; 2nd, based on the assumption that the data from the water gauge were not to be trusted, and the fuel rods were completely exposed, as in the Reactor 1. In both cases, the result showed that the nuclear fuel had melted and dropped to the bottom of the Reactor Pressure Vessel. In the 2nd case where they assumed the faulty water gauge, the result showed the entire fuel rods had melted, according to the report.
Tuesday, May 24, 2011
Japan nuclear update
Belarus Just Devalued Its Currency By 56%
When it comes to currency warfare, one can be polite and gentlemanly about it, like Brazil for instance, which every day, and sometimes on several occasions during the day, will proceed to buy dollars in an attempt to keep one's own currency lower. Or one can do what the Belarus central bank just did, and officially devalue one's currency, in this case the Belarus ruble, by 56% overnight, against every currency out there.
At this point, it sucks (that is a technical term) to be holding any exposure in BYR. Luckily for those who held their "money" in the form of gold and silver, they just got an instantaneous 56% value preservation and a relative boost in their purchasing power with just one central bank announcement. Also, any and all indebted parties who have BYR-denominated debts are throwing one big party tonight, as their debt was just cut by more than half. And yes, the Greeks are jealous with envy.
From Kommersant.ru:The National Bank of Belarus (NBB) is sharply devaluing the official rate of Belarusian ruble. The exchange rate as of May 24 was set at 4,930 rubles per dollar. a decrease of 56% from the 23 May.
Gold Ahead of Competition
Gold at all times has been the most reliable way to maintain savings. Currently, due to currency exchange rate fluctuations and unstable political system, gold continues to enjoy significant demand. In mid-April of 2011 the price of a troy ounce (31.1 grams) of the best-known precious metal exceeded $1,500.
According to experts, this dynamics of quotations does not cause any surprise. Most of the investment portfolio managers find it necessary to have gold in their assets, which can significantly improve the performance of the risk-return profile. Sergey Zimnin, Director of FG "Kalita-Finance" noted that gold has this privileged position due to several reasons, and most of them boil down to" protective "properties of this asset.
According to him, it is traditionally believed that gold is the most effective tool for hedging against inflation risks in the long-term investments. Another important characteristic of the precious metal is its low correlation with other financial assets. In other words, the dynamics of gold is less susceptible to the market influences. The latter was most clearly demonstrated during the acute phase of the current financial crisis, when on the background of falling stock and commodity indicators the "golden" quotes demonstrated systematic growth.
Most certainly, purchasing precious metals can hedge against the unpredictable fluctuations of the currency market, in particular, from the excessive weakness of dollar. After the crisis of the Bretton Woods system the U.S. dollar effectively took over as the global money, the status that originally belonged to gold. In addition, in recent years, the U.S. currency has not been able to cope with its mandated role and gold once again came to the foreground as a proven indicator of a universal measure of value. "The advantages of gold described above are characteristic of gold as an investment asset, but beyond this the precious metal is traditional goods at the trade exchange with its own specific properties. In this context the main advantage of physical gold is the lack of credit risk inherent in other financial assets," emphasizes Zimnin.
Gold as a commodity, unlike the securities or currencies, is not someone else's obligation, which is especially important in the current economic realities, where the effectiveness of the current global financial and credit paradigm is being questioned. As a result, the demand for gold is stable both under the normal market conditions and in times of political and economic upheaval. "
The price of gold is influenced by supply and demand dynamics in the market. In the last decade, the structure of buyers and sellers of precious metals has undergone significant changes. The major suppliers of gold to date are the five countries: China, U.S., Australia, Russia, and South Africa. They account for nearly half of all the gold mined in the world. Interestingly, in the early 1970's, nearly 75% of the world output was produced by only one country - South Africa - but now its position is less significant.
At the same time, experts of FG Kalita-Finance say that the average production cost per ounce of metal, according to various estimates, is approximately $860. Of course, the price will differ depending on the manufacturer, the location of mines, the depth of deposits, ore quality, etc. However, the conclusion that to date gold mining remains a highly profitable business is true for most enterprises. Another equally important conclusion is that we can say with a high degree of confidence that gold prices in the foreseeable future are unlikely to fall below the threshold of profitability ($860), since in this case the production would decline sharply and the imbalance in the supply and demand would push the prices of gold up.
"In general, while analyzing the future prospects for the prices of gold it may be noted that the main risk for the market is the reduction of the investment demand.
"At the same time, given the current economic realities, including the crisis of sovereign debt, rising inflationary pressures, the echoes of "currency wars," it is unlikely that purchase of "protective" asset would go down in the near future. Even if we assume that the world economy will soon come to the trajectory of a healthy fundamental growth (which is highly unlikely) and there will be no significant demand for gold as the insurance against economic threats, the price of precious metals would not necessarily fall, as in this case the industrial and consumer demand will be activated (the consumer's well-being will grow, and the jewelry industry and other sectors will increasingly buy gold stock.
As a result, the two functions of gold - that of a protective financial asset and that of the goods used in other industries - often counterbalance each other, allowing prices to respond more smoothly to the changing economic cycles. For this reason, in 2011, after a sharp rise in the first six months of the year, the gold prices will stabilizes, and the average price per ounce of gold for the year will be approximately $1,450, which is generally consistent with the market consensus ", Zimnin stressed.
Worldwide protest update
Chinese inflation helps gold to shine brightly
Fears have been mounting that China's actions to cool the economy will reduce demand for basic materials such as copper, iron ore and zinc.
However, one commodity that has been benefiting from Chinese inflation is gold.
In the first quarter of the year, China overtook India as the world's largest buyer of bullion and coins, according to the latest study of gold supply and demand trends for the World Gold Council (WGC).
The country remained in second place in total gold consumption because of the strong demand for jewellery in India for traditional reasons but, on the investment front, the Chinese are now at the head of the pack.
Total gold demand in the first quarter of the year rose by 11pc to 981.3 tonnes, equivalent to $43.7bn (£27bn) in monetary terms – a year-on-year rise of 40pc. This was largely attributable to a widespread rise in investment demand for bars and coins – but jewellery demand was strong in a number of markets too......read on
Eurozone Debt Crisis Deepens Sending Euro Lower and Gold to New Record at EUR 1,080/oz
The euro, global equities and bonds in peripheral Eurozone countries are all lower this morning on heightened concerns about the debt crisis in the Eurozone. The euro has fallen against all currencies and is now at a record low against gold at EUR 1,080.21/oz. Silver is lower against most currencies but is higher against the Australian dollar and the euro ( EUR 24.80/oz).
Cross Currency Rates
Greece’s 10 year government debt has surged to 16.98%, Portugal’s to 9.6% and Ireland’s to a new record at 10.76%. The yield on Italian 10-year government debt is up 9bp to 4.85% after S&P cuts its rating outlook on Italy’s sovereign debt to “negative” from “stable”. The Spanish 10 year bond has risen 11 basis points to 5.57%.
Besides sovereign debt risk, gold is also being supported by geopolitical risk as seen in the increasingly unstable nuclear armed Pakistan where armed militants attempted to take over Pakistan’s naval air force headquarters.
There is increasing tension between the U.S. and Pakistan after what the U.S regards as Pakistan’s failure or collusion regarding Osama Bin Laden.
China has increasing economic and military ties and interests in Pakistan and has vowed to standby Pakistan and has called on the world to respect Pakistan’s sovereignty.
Separately, in an interview with the Financial Times on Saturday, Henry Kissinger has warned of a world war involving Pakistan and India.
Demand for silver bullion in China remains robust with Chinese silver imports in April at 339.4 metric tonnes, according to data released by the Chinese customs agency today.
This compares to 302.09 metric tonnes in April 2010 or an increase of over 12% from the same month last year. It compares with silver imports of just 132.5 and 127.3 metric tonnes in April 2009 and April 2008 respectively.
This shows that the record Chinese demand for silver bullion seen in 2010 is continuing in 2011 and higher silver prices are not deterring Chinese buyers.
China imported 3475.4 tonnes of silver bullion in 2010 up a massive fourfold from 2009 when imports were just 876.8 tonnes. Importantly, China was a net exporter of silver bullion up until 2007.