2012… A practical joke? Or impending catastrophe?

These things in the 10^th generation shall come to pass. The earth shall be shaken by a great earth quake that throws many cities into the sea. There shall be war. Fire shall come flashing forth from the heavens and many cities burn. Black ashes shall fill the great sky. Then know the anger of the gods.

                                                                                                           

                                                                                                             -The Sybilline Oracles.

The Mayan, Indian and Chinese calendars talk about it. Nostradamus, the Greek prophecies and oracles have all mentioned it. Even our modern day scientists and computer softwares have predicted it. So the question remains, when will we be facing doomsday or rather the bigger question, how is it going to happen? Over the past years, speculations have risen on the many ways our world may end. Ranging from a virus out break to an asteroid collision or even an alien invasion, many scientists and speculators have come up with plausible and implausible ways to our demise.

I had started this research and completed it over the course of one year and have gotten it validated by the various scientific communities out there. As we go along, we will see that these events, although being three separate events, could actually turn out to be a chain reaction of one single event.

Let us first start by looking at the earth. The earth’s land masses are made and separated by tectonic plates.  These tectonic plates are constantly moving and colliding with each other which form the earth’s landscape. 

For example, the Himalayan mountain range is formed by the collision of the Indian Plate and the Eurasian Plate. It is this continuous collision between these two plates that has been causing the mountain range to be growing over time. It is the same movements of these plates that also cause earthquakes. When the earth plates move against each other, the plate with more solidity tends to move downwards while the other is forced to move upwards. It is this friction caused by the forced movement that causes tremors and if forceful enough, earthquakes. But occasionally certain glitches occur.

 About 200-300 years ago, the Indo-Australian Plate (the subducting plate) which was colliding with the Burma Sub-plate (over-riding plate), part of the Eurasian Plate got stuck to each other due to high amounts of friction. The part of the plate which got stuck started moving inwards with the other plate while the major portion of it was still moving against it. This had caused a “spring like” effect on this plate. Just as how a spring lets go with such force after being tightly wound to its maximum point, the Burma Sub-plate had popped back up, raising the sea bed to about  41ft along the coast of Sumatra for about 3100 miles, causing the Dec 24^th, 2004 tsunami. So you may ask, why should we worry about something which has already passed? Well, around the same time the previously mentioned plates got stuck, there were two other plates which did the same. This “sister” plate is located in the west coast of the Americas where the Pacific and North American plates meet. The problem is, not only is this plate still stuck, it has a larger land mass and is also situated in the Pacific ocean. When these plates let go, not only would it take 15 minutes for giant waves to wipe out North and South America, but it would generate waves that would travel across the Pacific and hit the Asian region too, creating a global catastrophe. These waves would be much larger than those of 2004 because of the volume of water it would travel through, the Pacific Ocean and the South China Sea. 

    Another problem which would arise from this earthquake is massive shockwaves. Shock waves travel in a circular direction. When these shock waves travel downward, they would cause tremors in magma chambers, causing the magma rivers to rise, triggering active volcanoes. Conveniently enough, the Ring of Fire, the region in which the largest portion of the world’s active volcanoes are situated in and connected by magma streams sits right under the collision point of the Pacific and North American Plates. 

So, large enough shockwaves would cause these streams in the Ring of Fire to activate.

 A similar incident had occurred back in August 26^th, 1883 in the islands of Indonesia. When two colliding plates sent shockwaves to the magma streams, it had caused the magma to rise with immense force through a volcano called Krakatoa that it exploded with the force of 200 megatons of TNT, eventually blowing the whole island off the face of the earth. The explosion had also generated waves which were 120ft in height which raced across the globe even as far as the English Channel. Dr. George Pararas, a geologist, had stated that the eruption had produced ashes and smoke which blocked out the sun for 3 years and sent shock wave to travel the earth thrice. 

But these are not even close to what scientists and geologists fear might happen when the current mega volcanoes were to erupt. The current most volatile mega volcanoes are currently situated in the same place

 – the Yellowstone National Park. Geologist Dr. Bob Christiansen, who has been researching the Yellowstone National Park for decades has noticed that since a major earthquake in August 17^th, 1959, Yellowstone National Park has recorded an average of 25 earthquakes a week, showing great signs of seismic activity. Geologist Dr. Bob Smith and leading volcano expert Dr. Bill McGuire, when trying to measure the size of the magma chambers were flabbergasted by their find. 

The first magma chamber was 50 miles long and 25miles across while the second magma chamber was 60 miles long and 30 miles wide. To help up visualize the devastation these would create, Dr. McGuire compares it to the eruption of Mt. St. Helens in the US.

 When St. Helens erupted in May 1980, it had spewed 7billion tons of rock and enough debris to cover Manhattan in 55ft of ash. And the force of the explosion was 500 times greater than the atomic bomb dropped on Hiroshima. Dr. McGuire, after spending months calculating, said that when these mega volcanoes erupt, the first would erupt with a force 1000 times greater than St.Helens while the second chamber would erupt with a force 2500 times greater than St. Helens. Prof. Mike Rempino of New York University had stated that when the Tambora volcano in East Java, the only thing which was remotely close to a mega volcano ever recorded, blew in 1815 the ashes which had clouded the Stratosphere blocked the sunlight sending US and Europe into a mini ice age right up to 1816. Dr. Rempino went on to say, that calculating the amount of ash and debris from the Yellowstone eruption would not only cover half the US with ash but would send enough ash and debris to the stratosphere to block out the sun and plunge us into an actual ice age killing billions of people.

 If the ice age doesn’t reek enough havoc, scientists at Harvard University have discovered that the debris from volcanic ash, which is made of rocks and glass shards, which is easily carried by winds, would cause something called the Maurice’s disease. When living beings breathe in the ash and debris, it would cause their lungs to bleed and as a natural reaction, the body would tend to grow new bones on top of the old ones, which translates to a slow and very painful death.

Besides these two death threats, the increase in seismic activity, which would cause shock waves to travel through the earth would cause huge land masses to collapse. When the vibration travels through solid masses, it would vibrate it causing to have internal shifts and if it shifts enough, it could dislodge a huge mass. Prof. Derek Elsworth of Pennsylvania State University demonstrated that when there is water trapped between two huge masses, 

 the water would tend to act like a lubricant. And this could make it easier for land masses to fall apart. This had happened in Alaska in July 9^th 1958 at Latuya Bay, when a small earthquake had caused a part of the mountain to fall into the waters. What scientists in Switzerland discovered, having built the most advanced model in testing the effects of landslides found out that when a huge mass of land thrusts itself into a body of water, the water would be displaced by the same amount of land mass causing what scientist now call a mega tsunami. When the mountain had collapsed in Alaska, it had cause huge waves which were almost 150ft in height, destroying quite a prominent amount of the surrounding landscape. Now, the problem is, volcanoes have a common property of being able to trap water within their walls.  Dr. Elsworth states that when this water trapped within the volcanic walls heats up, it produces steam which would cause pressure to act within the walls. So now, these walls would be lubricated and would have immense pressure working within forcing this already volatile chunk of land to collapse. And one particular volcanic island has caught the attention of scientists - The island Le’ Palma in the Canary Islands. 

Le’ Palma is made of two volcanoes, one dormant and the other active called the Cumbre Vieja. An eruption in 1949 had caused the dormant portion of the volcano to slide 13ft away from the Cumbre Vieja. Following this slide, scientists and geologists have swarmed the island to find out what would happen to this island in the long run. What they found was that the volcanoes were separated by walls of water stored in tank like columns within. If there were to be a substantial eruption, it would heat up the water, causing pressure to rise, which would dislodge  a part of the island measuring 13miles in length and weighing ½ trillion tons into the Atlantic. This would cause such displacement in the water that the initial wave would be 12200 ft in height and 98000 to 130000 miles in length, racing across the Atlantic at speeds of 480mph towards the east coast of America. This wave would destroy everything from New York right up to Miami traveling 13miles inland.  And this would take 8 hours to reach the USA.

So when is all of these going to happen? It could be today, tomorrow maybe a few thousand years from now. Or it could very well be Dec 21^st 2012, a date which has become synonymous to global apocalypse.  Why did the many ancient civilizations, prophets and oracles predict not just the same date but almost the same events which were going to happen on this day? Could it be mere coincidence that they all predicted the same things when they hardly had any means of corresponding with one another or the fact that most of their predictions had come true along the course of time? 

The Mayans had calculated that on this very day, the Sun, the moon, the earth, the planets and the black hole in the middle of the Milky Way (our galaxy) would be in a perfect alignment.  Something which Albert Einstein in 1955 further confirmed. Princeton University, which further undertook this study to further understand how this would affect the earth were mortified when they found out that during this alignment, the magnetic fields would be so strong that it would literally shift the earth’s mantle plate in just a matter of days. This event had been predicted to occur only every 800,000 years. True enough; 800,000 years ago, the earth’s mantels had shifted, altering the earth’s north and south poles. To give a clearer picture, scientists said that before the shift, Alaska was at the Earth’s equator. This will cause the poles to shift which could shift the earth’s rotation, possibly pushing the earth off its axis.

So, it is not a matter of whether these things are going to happen or not. They are going to happen. They question is, when?

By,

Ashveen Chakravarthy Sekaran

Dec 21, 2009

Eurozone Update - Nov

 I guess this month’s Eurozone update rolls in in a relatively timely manner. With tensions building around the globe and the economic scene at an utter unrest, the global markets have pretty much gone on a strike!  I guess it’s a good thing that the government has no prerogative to ban such strikes… or maybe they do and they are just checking if it is constitutional… The entertainment just seems to be in the headlines these days… Now, to more pressing matters… 

Germany’s recent attempt at auctioning its bonds (or bunds as they call it) was nothing but disastrous. Unable to auction off what it had targeted (35%) had inevitably proven a case and point on the global stance towards the Eurozone’s recovery. Germany, the strongest economy of the region was rather perplexed of its failure to lure finance towards its “appealing” 10-year bunds which were aimed at giving approximately 2%. But Germany’s failure was none of its own. With the recent downgrade of Portugal’s and Hungary’s bonds to “junk” bond status, the crawl towards the end of the tunnel, to see just a shimmer of light for the Eurozone, is bordering hopelessness. 

Most of the EU strongholds have already started showing signs of distress.  UK, with its daily payout of £50 million towards the eurozone’s recovery has made the country to finally feel the pinch. With France, Finland, the Netherlands and Austria having to pay more for their bonds than just a few months ago, the risk within the region is pretty much spiraling out of control. It is for these collective reasons that Germany has not been successful in reaching its target. But that’s not all. There are many layers of icing on this cake.

Fitch Ratings has recently issued a warning of a possible downgrade of France’s AAA bonds if there were to be sharper downturns, which trust me, is VERY likely. Downturns have been happening all over Europe. It’s like the indices got sick of the eurozone volatility and decided to throw up all over the region. (Yup, it’s that messy!) To put it in numbers, the FTSE 100 ( the share index of the 100 most capitalized UK companies listed on the London Stock Exchange) had recorded losses  amounting to £ 104 billion in just 8 days. Italy, also one of the larger economic contributors or the region, with bond issuances more than that of Greece, Spain and Portugal combined, is on the verge blowing the horn. With more uncertainties looming around the region, it is hard to say what would save the eurozone from this predicament.  Trust me, Angela Merkel (the German Chancellor) is not the only one having her hands on her forehead.

So how is this affecting asia? Well, Japan is not in the best of shape as it is already showing signs of a downgrading of its bonds. However, Fitch Ratings (the guys who have been on the bond downgrading spree) have stated that, “the impact of the Eurozone debt crisis should “manageable” due to an increase in regional trade and greater reliance on regional banks”. But this statement was based especially due to the increase in economic activity in China, India and Indonesia. So, when it comes to investing, look into such markets as they are bound to perform in the coming years. 

By,

Ashveen Chakravarthy Sekaran(Nov 26^th, 2011)

Eurozone October Update

The Eurozone crisis may have been averted for the time being, but to be honest, they are yet to see the break of dawn. As the clock ticks and urgent decisions are needed to be made, Germany and France have given hopes to the rest of the Eurozone that they have an approach or in their words a “Bazooka” to “blow” the Eurozone problem out of the danger zone. Bazooka it may be… But the question is, what if they miss the target? And this would not be something you could brush off with a simple “oops!”

Germany and France are working  on (and claim to have)the approach to address the Eurozone mess. As much as they have propagandized it, they have not let the rest of the world into their approach. I mean, it’s a good sign that Angela Merkel and Nicolas Sarkozy are meeting to discuss the issue… But investors are going to need to see a layout (at least a general one) as soon as possible. Things may seem hunky-dory right about now but if no hints are going to be shared soon, investors may become restless and the market may become very choppy. This may actually become true as Germany and France have stated that their lips are zipped on this issue till the end of the month where they will make the idea public by announcing it in the Cannes Summit. 

Even then, France and Germany are having two different views on this whole debt issue. France wants to recapitalize banks in order to have more money circulating. But this would work to favour the nation as France is having fears of a possible downgrade of their AAA-rated bonds if money becomes tight. The 440 billion Euro bailout has already had some cash flowing through the region but in order to have it running without the possibility of falling flat on its face, the Eurozone would need at least 1.5 trillion Euro; which at this point may be impossible to raise upfront as it might be a major strain on the member states. So the alternative might be to leverage the European Financial Stability Facilities (EFSF), which investors are less enthusiastic about. 

Germany on the other hand feels that national governments should take care of their own dirty laundry. And since Germany is Ra-Ra about the private sector sharing into the crisis, it is very possible that they are planning on recapitalizing banks but may not be on board with the same reason as France as France should learn to do its own laundry (from Germany’s point of view). Having said that, it is clear that the focus is currently shifted to the banking sector as there are fears of a banking crisis waiting to take place… So for those who said banks were safe and didn’t quite believe that they could become messed up… well, this is the point is go “I TOLD YOU SO” (plus, where do you think the word BANKrupt comes from?)

So, recapitalizing banks… is this good or bad? There are two ways that they might be looking at recapitalizing the banks. 

1) Drop in share price with dividend payouts or 2) Create new shares. But what do they have in store? If they choose to

1.       Drop share price with dividend payouts

a.       Shareholders would not be very happy as their shares would be significantly devalued.

b.      Banks would not be exposing themselves to (much) new investors and would only be answerable to current shareholders.

       2.      Create new shares

a.       Shareholders would be able to buy into these without having to trade-off of their previous investments.

b.      Banks would be exposing themselves to a new pool or investors creating more market exposure. 

If there is a choice that is to be made, the second option would be the lesser of two evils.

While that is happening to the banks, Greece’s problems are still evolving (I think Darwin was studying the wrong subject to prove his theory). As Greece is ironing out (or trying) it’s creases, things look like it may not work out too well or as what is being expected. If you ask me, it might be wise for Greece to think of defaulting on its debts simply because it is evolving into a Debt-a-saur (trying to make this dry article a little humorous… so work with me here).  But this decision should not be made until the banks in the Eurozone are prepared to absorb the HUGE losses that would be incurred by the default. To put it into perspective, think of it this way, you have loaned a million dollars to someone and are waiting for that person to pay back. If the person can’t payback and is on the verge of declaring bankruptcy, you might want to make sure that you are in a position where the million dollars in not that significant to be  written-off by you. 

By,

Ashveen Chakravarthy Sekaran

October 11^th, 2011

FinTips October

When I was just a little boy,

I asked my mother, what will I be,

Will I be handsome, will I be rich,

Here’s what she said to me,

Oh Ashveen, Ashveen,

Whatever would be, would be,

The future’s not ours to see,

Oh Ashveen, Ashveen,

What will be, will be.

For which I went… But mom, you are supposed to know the answer to EVERYTHING!  Well, I was 3 then. So naturally, my parents were THE smartest people to walk the earth. The age where my father was the strongest man, stronger than superman, my mom was the most beautifulest (it was a completely acceptable adjective when I was 3) person and nobody was as beautiful as her! And living with my sister was the worst nightmare (for her at least). 

Well, eventually I grew up. And today, when I see what my mom told me when I was 3 years old, it makes perfect sense! The future’s not ours to see! Especially, when we look at the current market. Looking at the global indices may make any investor pretty nauseous right about now and things don’t seem to be aiding this as Bursa just announced that the roller coaster ride might be continuing for a while.

With the Eurozone crisis insatiable and US problems becoming grotesque, things aren’t going to be financially safe for a while. My last e-mail had mentioned about the German problem and what it may lead to. Well, let’s just say that the plot has thickened and now the suspense is killing (literally). With the aids given to Greece to flush the debt issue down the drain, Greece better be able to settle their debts and most importantly, find methods of regenerating their stagnant economy. With people protesting the Eurozone aid pouring into Greece, much work is being left undone. What I don’t understand is this: (See if you can follow)

1.       Greece is in deep… trouble. (well, it’s a public article… so I have to mark my language, right?)
2.       People don’t want to work coz there is risk of not being paid.
3.       People start protesting against the government for bad planning.
4.       Eurozone takes into account the happenings and takes steps to correct the errors of Greece from affecting the whole of the EU.
5.      11 of the 17 Countries in the EU (as at this moment) decide to fund Greece. Might be increasing as they are meeting today to further discuss.
6.       Representatives go to Greece to help with the economic and financial plans.
7.       Greeks get angry that their financial system is being monitored by other members of the EU.
8.       Greeks protest against the “others” to get out of their country and leave them be.
9.       Greeks also protests against government for letting “others” come in.
10.    Greeks don’t want funds from others and are saying that they can solve their own problems.
11.    BUT they do not want to have an increase in tax, pricing, and do not want to contribute more than what they already are to the work force.
12.    And they are still protesting…

That’s just part of the story. Now, another fear that has started to gloom the scene is the amount Germany has invested into Greece. With a significant sum (based on this economic climate) that has been pumped into Greece, Germany is only hoping that nothing disastrous happens to it or Greece. If something like that were to happen, Germany will be hitting the wall. And if that happens, there will be a huge global display of fireworks and not the pretty kind. 

Moving more to the west, we see that US has also started having quite a bit of an issue. The actions of America seem to be more like that of the school bully. The bully is bullied at home and can’t do anything about it. He cries and whines about it but nobody really cares. So to vent his frustration and demand power, he goes to school and starts bullying other kids. And when he finds that one kid who is the easy target, he starts treating the kid as his personal lunch money ATM. In America, protests (or how some might deem it as riots) are taking place in Wall Street and Boston where people are voicing against the high medical costs and prices of goods. So, the government is being battered by the people. With tuition costs sky rocketing, many are finding it hard to continue their education and even find jobs as unemployment is still climbing the limitless ladder. As much as I want to feel bad for the American government, I should say, they brought this on themselves. They had pampered their public to such an extent that now; they demand to be treated well, despite the dying economy. With slogans such as “fight the rich, not their wars” and “human need, not corporate greed”, I feel the focus of this protest is being channeled towards the wrong direction. Then again, there is not quite a foundation for this protest in the first place. There is no leader, no concrete ideology or philosophy. Is this the process in which a developed nation becomes undeveloped? 

That is why, America (the bully), has started ordering China (the kid) to re-asses its money and to listen to America’s way of managing their funds coz America has been doing such a splendid job at that. China is afraid to go against the wishes of America because of the heavy investment of America on Chinese soil. The slowdown of the Chinese monetary system has begun to threaten the American economy which has already slipped more than 12% in these few months. With China also being asked to buy into the Italian bonds/treasuries, the options shoved into its (China’s) face is really not giving it much room to breathe. So the current market in this (ASEAN) region is pretty much reflecting it. When would it cool off? There really is no sane answer to that question. So all we could do is tread carefully.

For those who had invested more than RM 100,000.00 , this current market movement has aided them well as they could switch in and out without fear of having to spend more after exhausting their 2 free switches. But for those who invested lesser than RM 100,000.00, I had to wait for quite a while to not spend the 2 free switches given and incur charges on the investment. And as scary as it may sound, get your checkbooks ready as this is an excellent time to reinvest… Think of it this way, the market wants money, they lower the prices of goods without compromising the quality… Who wouldn’t want it? Imagine getting a Rolls-Royce for RM10,000.00…. Who wouldn’t want it?!

By,

Ashveen Chakravarthy Sekaran

Oct 3^rd, 2011