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Yellowstone Earthquakes: Supervolcano Update
Tweet Share on Facebook January 2, 2009 Comment (99)A Yellowstone earthquake update:
1) The rumbling continues, including 3.5, 3.0 and 3.2 quakes just today
2) Here is some more Jake Lowenstern (the Yellowstone volcano scientist) analysis (via TIME):
Jake Lowenstern, Ph.D.,YVO's chief scientist, who also is part of the USGS Volcano Hazards Team, told TIME that it doesn't appear a supervolcano event is imminent. "We don't think the amount of magma exists that would create one of these large eruptions of the past," he said. "It is still possible to have a volcanic eruption comparable to other volcanoes. But we would expect to see more and larger quakes, deformation and precursory explosions out of the lake. We don't believe that anything strange is happening right now." Last summer, YVO installed new instrumentation in boreholes 500 to 600 feet deep to better detect ground deformation. Says Lowenstern: "We have a lot more ability to look at all the data now.
3) Here is a passage on the Yellowstone supervolcano from "A Short History of Nearly Everything" by Bill Bryson. He interviews a Yellowstone geologist, Paul Doss. I don't find it reassuring:
I asked him what caused Yellowstone to blow when it did.
"Don't know. Nobody knows. Volcanoes are strange things. We really don't understand them at all. Vesuvius, in Italy, was active for three hundred years until an eruption in 1944 and then it just stopped. It's been silent ever since. Some volcanologists think that it is recharging in a big way, which is a little worrying because two million people live on or around it. But nobody knows."
"And how much warning would you get if Yellowstone was going to go?"
He shrugged. "Nobody was around the last time it blew, so nobody knows what the warning signs are. Probably you would have swarms of earthquakes and some surface uplift and possibly some changes in the patterns of behavior of the geysers and steam vents, but nobody really knows."
"So it could just blow without warning?"
He nodded thoughtfully. The trouble, he explained, is that nearly all the things that would constitute warning signs already exist in some measure at Yellowstone. "Earthquakes are generally a precursor of volcanic eruptions, but the park already has lots of earthquakes-1,260 of them last year. Most of them are too small to be felt, but they are earthquakes nonetheless."
A change in the pattern of geyser eruptions might also be taken as a clue, he said, but these too vary unpredictably. Once the most famous geyser in the park was Excelsior Geyser. It used to erupt regularly and spectacularly to heights of three hundred feet, but in 1888 it just stopped. Then in 1985 it erupted again, though only to a height of eighty feet. Steamboat Geyser is the biggest geyser in the world when it blows, shooting water four hundred feet into the air, but the intervals between its eruptions have ranged from as little as four days to almost fifty years. "If it blew today and again next week, that wouldn't tell us anything at all about what it might do the following week or the week after or twenty years from now," Doss says. "The whole park is so volatile that it's essentially impossible to draw conclusions from almost anything that happens."
Evacuating Yellowstone would never be easy. The park gets some three million visitors a year, mostly in the three peak months of summer. The park's roads are comparatively few and they are kept intentionally narrow, partly to slow traffic, partly to preserve an air of picturesqueness, and partly because of topographical constraints. At the height of summer, it can easily take half a day to cross the park and hours to get anywhere within it. "Whenever people see animals, they just stop, wherever they are," Doss says. "We get bear jams. We get bison jams. We get wolf jams."
In the autumn of 2000, representatives from the U.S. Geological Survey and National Park Service, along with some academics, met and formed something called the Yellowstone Volcanic Observatory. Four such bodies were in existence already-in Hawaii, California, Alaska, and Washington-but oddly none in the largest volcanic zone in the world. The YVO is not actually a thing, but more an idea-an agreement to coordinate efforts at studying and analyzing the park's diverse geology. One of their first tasks, Doss told me, was to draw up an "earthquake and volcano hazards plan"-a plan of action in the event of a crisis.
"There isn't one already?" I said.
"No. Afraid not. But there will be soon."
"Isn't that just a little tardy?"
He smiled. "Well, let's just say that it's not any too soon." -
Economic Recession? Depression?
Tweet Share on Facebook January 2, 2009 Comment (12)Nigel Gault of IHS Global Insight gives one of the more bearish outlooks that I have seen. And Obama won't save us, he says:
Happy New Year? Maybe in 2010 As we enter 2009, the U.S. and global economies are in steep decline, in what is the most severe synchronized global downturn of recent times. ... One year from now, we will probably be able to look forward to 2010 with solid hope for a resumption of global growth. But first we have to get through 2009, which will likely see the first decline in world real GDP in the postwar era. ... We expect U.S. real GDP to drop 5.6% in the fourth quarter and 5.4% in the first quarter of 2009. ... We see negative growth through mid-2009, and only anemic positive growth in the second half, so that would put the recession's length at somewhere between 18 and 24 months—the longest in the postwar era. In terms of depth, we anticipate a 3.4% peak-to-trough decline in real GDP, exceeded only by the short-but-sharp 1957–58 recession (down 3.7%). The calendar-year GDP outcome for 2009 is minus 2.5% growth, worse even than the 1.9% drop in 1982. ... The holiday shopping season is proving as bad as retailers had feared. Real consumption dropped 3.8% in the third quarter; we expect declines in the 2.5–3.0% range in the fourth and first quarters. The decline in the labor market is accelerating; the United States lost 533,000 jobs in November and we expect a loss of 550,000–600,000 in December. We see the unemployment rate at 9.1% by the end of 2009. Housing starts and prices continue to retreat, with no end in sight, and nonresidential construction is poised for a steep drop in 2009. Export growth had been propping up the U.S. economy, but with the rest of the world in recession, we now expect exports to contract 7.0% in 2009. ... The Obama administration-in-waiting is preparing a large fiscal-stimulus package. ... The message from the Obama camp is that the package will be valued somewhere between $675 billion and $775 billion over two years. But how quickly can the funds actually be spent? Infrastructure spending is a key part of the package, and it cannot be turned on and off like a faucet. We assume that the funds will take much longer than two years to spend out, and that the actual total stimulus injected over the first two years will be $500 billion. Combined with the Fed's vigorous easing, the package should help to stabilize the economy in the second half of 2009 and promote some recovery during 2010.
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Hank Paulson: How He Made the Recession Worse
Tweet Share on Facebook January 2, 2009 Comment (4)The American economy is suffering a crisis of confidence, and Treasury Secretary Hank Paulson hasn't helped, says Stanford University economist John Taylor. Blame the TARP rollout for a worsening of the financial crisis, nto the failure to save Lehman:
While [the spread between three-month Libor and the three month Overnight Index Swap] did rise during the week following the Lehman Brothers decision, it was not far out of line with the events of the previous year.
On Friday of that week, the Treasury announced that it was going to propose a large rescue package, though the size and details weren't there yet. Over the weekend the package was put together and on Tuesday September 23, Federal Reserve Board Chairman Ben Bernanke and Treasury Secretary Henry Paulson testified at the Senate Banking Committee about the TARP, saying that it would be $700 billion in size. They provided a 2-1/2 page draft of legislation with no mention of oversight and few restrictions on the use. They were questioned intensely in this testimony and the reaction was quite negative, judging by the large volume of critical mail received by many members of the United States Congress. ...
It was following this testimony that one really begins to see the crises deepening, as measured by the relentless upward movement in Libor-OIS spread for the next three weeks. Things steadily deteriorated and the spread went through the roof to 3.5 per cent. 3.2 The Lack of a Predictable Framework for Intervention
Moreover, it is plausible that events around September 23 actually drove the market, including the realization by the public that the intervention plan had not been fully thought through and that conditions were much worse than many had been led to believe. At a minimum a great deal of uncertainty about what the government would do to aid financial institutions, and under what circumstances, was revealed and thereby added to business and investment decisions at that time. Such uncertainty would have driven up risk spreads in the interbank market and elsewhere. -
How Bad Will the U.S. Economy Get?
Tweet Share on Facebook January 2, 2009 Comment (10)If Ken Rogoff and Carmen Reinhart are correct (they looked at 18 postwar banking crises), much worse:
Broadly speaking, financial crises are protracted affairs. More often than not, the aftermath of severe financial crises share three characteristics. First, asset market collapses are deep and prolonged. Real housing price declines average 35 percent stretched out over six years, while equity price collapses average 55 percent over a downturn of about three and a half years.
Second, the aftermath of banking crises is associated with profound declines in output and employment. The unemployment rate rises an average of 7 percentage points over the down phase of the cycle, which lasts on average over four years. Output falls (from peak to trough) an average of over 9 percent, although the duration of the downturn, averaging roughly two years, is considerably shorter than for unemployment.
Third, the real value of government debt tends to explode, rising an average of 86 percent in the major post–World War II episodes. Interestingly, the main cause of debt explosions is not the widely cited costs of bailing out and recapitalizing the banking system. Admittedly, bailout costs are difficult to measure, and there is considerable divergence among estimates from competing studies.
But even upper-bound estimates pale next to actual measured rises in public debt. In fact, the big drivers of debt increases are the inevitable collapse in tax revenues that governments suffer in the wake of deep and prolonged output contractions, as well as often ambitious countercyclical fiscal policies aimed at mitigating the downturn.
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Obama's Trillion Dollar Stimulus May Not be Needed
Tweet Share on Facebook January 2, 2009 Comment (4)Falling oil prices, plunging mortgage rates, an "all in" Fed. Maybe we don't need Obama's trillion-dollar stimulus packages after all. Jim Paulsen of Wells Capital doesn't seem to think so:
There is currently much support for a trillion dollar fiscal spending package being proposed by the incoming Obama administration. However, for perspective, consider that the current trailing 12-month federal deficit is about $700 billion and will likely be near a trillion dollars by the time Obama takes office. Therefore, the trillion dollar fiscal package which many think is required next year has already been implemented! Does the consensus appreciate how much policy juice has already been dumped into this economy?
Moreover, many of these record-setting policies have not yet had a sufficient lag time to work, but will by this summer! Although policy actions have not yet shown much positive impact, it would be odd indeed if the record-setting policy response of 2008 produced only modest economic results this year.
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Yellowstone Earthquake Swarm: Updated
Tweet Share on Facebook January 2, 2009 Comment (129)More on the Yellowstone earthquake swarm at the supervolcano caldera. First, this piece of database analysis from an IT guy at Splunk puts the swarm into scary perspective:
I'm sending you this email with some information I've gleaned from the USGS archives. I'm analyzing the ANSS data (http://www.ncedc.org/cnss/) in an install of Splunk, which is a timeline based search and reporting engine. I have 30 years of data in the system, with about 2M quakes total. It makes doing graphs and adhoc investigations faster than dealing with the USGS limited search forms. Disclaimer: I work for Splunk as their evangelist, and spend a lot of time studying various timeline based textual data and writing interesting apps for the software. I am not an earthquake expert by any means.
Using the ANSS data, I discovered the number of 2.5 or higher quakes in the *general* Yellowstone area for the decade of the 1980s was 128. The number of 2.5 or higher quakes for the region directly around the lake in the *last 4 days* was 30.
Again, for 2.5 mag or greater quakes:
Entire region of Yellowstone for 10 years = 128 quakes
Area just around Yellowstone Lake last 4 Days = 30 quakes
The entire 1980s of 2.5 or higher quakes in the vicinity of the lake was a paltry 4 quakes. Doing a quick back of the envelope calculation using the number of quakes and the intesities, the activity over the last 4 days has released roughly 100x the amount of energy released in the entire 1980s for the same general region. In the last week alone there have been 10 quakes of magnitude 3.0 or greater around the lake, with one as high as 3.8.Also here is a pretty good summary of events from the Yellowstone Volcano Obervatory:
December 2008 Yellowstone Earthquake And Ground Deformation Summary
Earthquake Summary:
Yellowstone seismicity increased significantly in December 2008 due to an energetic earthquake swarm that commenced on December 26. This swarm, a sequence of earthquakes clustered in space and time, is occurring beneath the northern part of Yellowstone Lake in Yellowstone National Park. As of this writing, the largest of these earthquakes was a magnitude 3.9 at 10:15 pm MST on Dec. 27. Through 5:00 pm MST on Dec. 31, the sequence had included 12 events of magnitude 3.0 to 3.9 and approximately 20 of magnitude 2.5 to 2.9, with a total of at least 400 events large enough to be located (magnitude ~1 or larger). National Park Service (NPS) employees and visitors have reported feeling the largest of these earthquakes in the area around Yellowstone Lake and at Old Faithful and Grant Village.
The hypocenters of the swarm events cluster along a north-south-trending zone that is about 7 km long. The vast majority of the focal depths are shallower than 5 km. It is not possible to identify a causative fault of other feature without further analysis.
Analysts are currently processing the backlog of seismic data from these events. The current analyst-processed catalog is believed to include all events of magnitude 2.5 and greater through Dec 31 at 5 pm MST, but hundreds of earthquakes remain to be processed. The total of more than 400 locatable events is based on automatically-determined locations and magnitudes for the swarm events.
The December 2008 earthquake sequence is the most intense in this area for some years. No damage has been reported within Yellowstone National Park, nor would any be expected from earthquakes of this size. The swarm is in a region of historical earthquake activity and is close to areas of Yellowstone famous hydrothermal activity. Similar earthquake swarms have occurred in the past in Yellowstone without triggering steam explosions or volcanic activity. Nevertheless, there is some potential for hydrothermal explosions and earthquakes may continue or increase in magnitude. There is a much lower potential for related volcanic activity.
The National Park Service in Yellowstone has been kept fully informed of the ongoing seismic activity via electronic means and by phone contacts with the University of Utah and the U.S. Geological Survey USGS). The Wyoming Office of Homeland Security is reviewing Earthquake Response Plans and monitoring seismic activity. -
China: Will It Break Apart?
Tweet Share on Facebook January 1, 2009 Comment (10)Think things can't get worse? Just pay attention to growing civil unrest in China. I am. And so is economist Dani Rodrik:
Will China hold together? China is a country of enormous tensions and cleavages beneath the surface, and these will find more occasion to erupt into open conflict in difficult economic times. Experts on China differ in their estimate of the rate of economic growth the country needs to create employment for the millions that flock into its urban areas every year. But it is virtually certain that China will fall short of this threshold in 2009. The question is whether policy actions to date will do enough to stem a socially and politically dangerous slowdown in the economy. Whichever way the Chinese leadership responds, future generations may remember 2009 less for its global economic and financial crisis than for the momentous transformation it will have caused in China.
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Bring On the Big Media Bailout
Tweet Share on Facebook January 1, 2009 Comment (1)Trust me, everyone and anyone who works for a media organization thought the same thing upon reading this headline and first graph from Bloomberg:
Treasury Opens Door to Aid for Broad Array of Firms, Industries
The U.S. Treasury threw the door open to taxpayer financing for a widening array of companies and industries by drafting broad guidelines on aid to the auto industry.
Me: Hey, Uncle Sam, look over here! We media folks love those big ads from the Big Three. Gimme, gimme, gimme ...
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Should Uncle Sam Bail Out the Stock Market ?
Tweet Share on Facebook January 1, 2009 Comment (2)Have Uncle Sam prop up the stock market? Lots of people think the government already does that from time to time. From the FT:
It is time for a greatly increased role for monetary policy through direct intervention of central banks in world stock markets to prevent bubbles and crashes. Central banks control interest rates by buying and selling securities on the open market.
A logical extension of this idea is to pick an indexed basket of securities: one candidate in the US might be the S&P 500, and to control its price by buying and selling blocks of shares on the open market.
Even the credible announcement that a policy of this kind was being considered should be enough to boost the markets and restore consumer and investor confidence in the real economy.
Critics will argue that this policy is dangerous socialist meddling. But I am not arguing that the government should pick winners and losers: only that it should stabilise a broad basket of stocks.
This policy would still allow poorly run firms to fail but it would not allow all firms to fail at the same time. Although the free market is very good at deciding how many left and right shoes to produce, it cannot prevent systemic risk that arises from the psychology of herd behaviour. This is a job for Uncle Sam.
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2009: A New Progressive Era?
Tweet Share on Facebook January 1, 2009 Comment (3)Does this nugget from PM Gordon Brown make you want to invest in stocks for the next decade or two? As he put it in his New Year's message:
When the history books come to be written, 2008 will largely be remembered for the scale of the great economic and financial crisis. A year in which an old era of unbridled free market dogma was finally ushered out. ... And I want 2009 to be the year when the dawn of a new progressive era breaks across the world: purposeful and energetic governments giving real help to families and businesses when they need it the most; and through expanding the downturn vital investments in our future - real hope for that future too.
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