March 2, 2016: long story in the Los Angeles Times --
More than five years after Oklahoma first saw a startling spike in earthquakes linked to the disposal of huge volumes of wastewater created by hydraulic fracturing for oil, the state continues to shake at an unprecedented rate and the number of strong quakes is increasing. In 2009, there were 20 quakes of magnitude 3.0 or higher, according to the United States Geological Survey. Last year, there were 890. In 2009, no quake measured 4.0 or greater. Last year, 30 did.
Now, however, after quakes have shaken the homes of some top elected officials — and those of the worried constituents who vote for them — the state is taking new steps to address the problem, even as critics say it is too little, too late.
Last month, the Oklahoma Corporation Commission, the agency that regulates the oil and gas industry, asked oil producers operating in the northwest part of the state to reduce the amount of wastewater they are disposing of deep underground by 40%.
Scientists say natural faults in the area are being stirred by billions of gallons of water injected deep into the ground after it is used for hydraulic fracturing, commonly known as fracking. Water and chemicals are used to break oil and gas free from rock formations. A large amount of the water returns to the surface and, under federal law, must be disposed of in a way that does not affect freshwater supplies.
On Feb. 13, a quake northwest of Fairview, about two hours away, registered a magnitude of 5.1, making it the third-strongest quake in the state's recorded history. The strongest was in 2011. The second-strongest was in 1952; and scientists now say it, too, may have been induced by nearby oil production.February 20, 2016: KOCO.com is reporting -- at least not quite as many (LOL):
Since January 1 of 2016 until February 19 Oklahoma has recorded 339 earthquakes of magnitude 2.5 or greater.
Through the same period last year the state had recorded 389 quakes.
This year, seven earthquakes of 4.0 magnitude or greater have occurred in the state.
Through the same time last year, four earthquakes of magnitude 4.0 occurred.
The strongest earthquake this year was a 5.1 that occurred February 13 in northern Oklahoma.
I did not see the new fields in Oklahoma on my trip to the Bakken, but driving through the legacy fields along I-35 really demonstrates why the Bakken is the Bakken. Without seeing it firsthand, it is impossible to adequately describe the inconsequential (by comparison) the singleton donkey heads along I-35 in southern Oklahoma with the giant (by comparison) pumping units on multi-well pads in the Bakken. Vern Whitten has done an incredible job documenting the history of the Bakken. One can google Vern Whitten on the blog to see what I mean.
While traveling I am able to watch cable television (which I don't have at home except for the four basic networks). I happened to catch a segment on "negative rates" on CNBC. The "expert" suggested that "negative rates" would lead to a cashless society. I was unable to connect the dots.
However, there may be another dot to connect with regard to a cashless society. The Washington Post is reporting it's time to do away with the $100 bill.
The paper makes a compelling case for stopping the issuance of high denomination notes like the 500 euro note and $100 bill or even withdrawing them from circulation.With regard to the earlier question, how negative rates relate to a cashless society, Business Insider provides this article from last autumn: People are hiding cash in their microwaves as Sweden gets closer to being the first cashless society with negative interest rates.
I remember that when the euro was being designed in the late 1990s, I argued with my European G7 colleagues that skirmishing over seigniorage by issuing a 500 euro note was highly irresponsible and mostly would be a boon to corruption and crime. Since the crime and corruption in significant part would happen outside European borders, I suggested that, to paraphrase John Connally, it was their currency, but would be everyone’s problem. And I made clear that in the context of an international agreement, the U.S. would consider policy regarding the $100 bill. But because the Germans were committed to having a high denomination note, the issue was never seriously debated in international forums.
The fact that — as Sands points out — in certain circles the 500 euro note is known as the “Bin Laden” confirms the arguments against it. Sands’ extensive analysis is totally convincing on the linkage between high denomination notes and crime. He is surely right that illicit activities are facilitated when a million dollars weighs 2.2 pounds as with the 500 euro note rather than more than 50 pounds as would be the case if the $20 bill was the high denomination note. And he is equally correct in arguing that technology is obviating whatever need there may ever have been for high denomination notes in legal commerce.
What should happen next? I’d guess the idea of removing existing notes is a step too far. But a moratorium on printing new high denomination notes would make the world a better place. In terms of unilateral steps, the most important actor by far is the European Union. The €500 is almost six times as valuable as the $100. Some actors in Europe, notably the European Commission, have shown sympathy for the idea and European Central Bank chief Mario Draghi has shown interest as well. If Europe moved, pressure could likely be brought on others, notably Switzerland.
Sweden is shaping up to be the first country to plunge its citizens into a fascinating — and terrifying — economic experiment: negative interest rates in a cashless society.The dots are still hard to connect (counterintuitive, might be a better word) but I think I understand what the "expert" on CNBC was suggesting.
The Swedish central bank, the Sveriges Riksbank, on Wednesday held its benchmark interest rate at -0.35%, the level it has been at since July.
Though retail banks have yet to pass that negative rate on to Swedish consumers, they face increased pressure to do so as long as the rates remain where they are. That's a problem, because Sweden is the closest country on the planet to becoming an all-electronic cashless society.
Remember, Sweden is the place where, if you use too much cash, banks call the police because they think you might be a terrorist or a criminal. Swedish banks have started removing cash ATMs from rural areas, annoying old people and farmers. Credit Suisse says the rule of thumb in Scandinavia is: "If you have to pay in cash, something is wrong."
Near the end of the linked article:
So two trends are converging on Sweden at the same time:
- Sweden is using less and less cash. Sweden is an environment of negative interest rates.
- And that means many Swedes have no way to "hide" their money.
So Sweden may become the first country whose citizens may have to accept negative interest rates (probably in the form of higher bank charges or fees) or be forced to spend their money to "save" it from those rates.
A resistance is forming, and some people are protesting the impending extinction of cash.For an even more up-to-date article, the Renegade Tribune, three days ago, posted this article:
Events are moving very quickly in the world of money and banking. One tectonic shift that is being reported on in the alternative media, but very conveniently ignored by the mainstream media is the link between the elimination of cash and negative interest rates. Introducing these two conditions into our economy will bring crushing financial hardship onto the ordinary citizen – yet few understand the critical link between the two.That linked article led to a zerohedge article.
February 18, 2016: an op-ed in The Wall Street Journal. I finally understand how negative rates will lead to a cashless society. But it requires a few more steps, including the end of large paper bills (currency) such as the US $100 bill and the EU's 500 Euro bill.
The real reason the war on cash is gearing up now is political: Politicians and central bankers fear that holders of currency could undermine their brave new monetary world of negative interest rates. Japan and Europe are already deep into negative territory, and U.S. Federal Reserve Chair Janet Yellen said last week the U.S. should be prepared for the possibility. Translation: That’s where the Fed is going in the next recession.
Negative rates are a tax on deposits with banks, with the goal of prodding depositors to remove their cash and spend it to increase economic demand. But that goal will be undermined if citizens hoard cash. And hoarding cash is easier if you can take your deposits out in large-denomination bills you can stick in a safe. It’s harder to keep cash if you can only hold small bills.
So, presto, ban cash. This theme has been pushed by the likes of Bank of England chief economist Andrew Haldane and Harvard’s Kenneth Rogoff, who wrote in the Financial Times that eliminating paper currency would be “by far the simplest” way to “get around” the zero interest-rate bound “that has handcuffed central banks since the financial crisis.” If the benighted peasants won’t spend on their own, well, make it that much harder for them to save money even in their own mattresses.One of my least favorite songs: