Big Questions Remain After Spanish Bailout

While European soccer players were expertly kicking the ball down the field this weekend in the Euro 2012 tournament, European finance ministers were expertly kicking their debt crisis down the road.

Spain’s request on Saturday for a 100 billion euro loan (about $125 billion) to recapitalize its banks seems likely to be at least a short-term solution to the worries lately that have gripped European financial markets, raising concerns about a global economic slowdown that could push the United States back into recession.

As the odds of a bank run in Spain have increased in recent weeks, Spanish borrowing costs have soared, while the values of the euro and risky assets such as stocks and commodities have tumbled. Saturday’s news could at least temporarily reverse some of those ugly moves.

Even better for Spain, it gets to avoid additional austerity measures as a condition of the loan, as Greece and other bailed-out nations have suffered in the recent past.

But still some big questions linger.

First, will 100 billion euros ultimately be enough? A report by the International Monetary Fund suggests this will be more than enough and that Spanish banks need to raise 60 billion to 80 billion euros to mollify investors and cover losses in Spain’s real estate market.

But those losses might continue to grow, which would mean that Spain has to go back to the well again. JPMorgan Chase analysts recently estimated that Spain could need as much as 350 billion euros, the Telegraph reported.

Second, rather than injecting the money directly into Spain’s banking system, European nations will lend it to Spain. This means that Spain, already more than 700 billion euros in debt, could end up more than 800 billion euros in debt. The new debt has been promised at a considerably lower interest rate than the market currently charges Spain — recently more than 6 percent for a 10-year loan. Still, every little bit of extra debt hurts. How much will the market punish Spain for having more of it?

Finally, there’s the question of who might be next. Now that Spain’s bleeding has been temporarily stopped, all eyes are quickly turning to Italy, whose banks are also in trouble and whose own borrowing costs are rising. And no one has forgotten about Greece, which holds a new parliamentary election next weekend that could determine its future in the eurozone — an event that could spark fresh market turmoil and have European officials holding hasty bailout conference calls all over again.

Ultimately, longer-term solutions will probably involve even more painful political choices than Spain’s decision to seek a bailout. Those choices will include nations giving up some control over their own fiscal affairs, to form a more unified Europe. Officials may have kicked such choices down the road just a little bit longer this weekend, but they’re going to run out of road one of these days.

What Is The True Cost Of These Coal Plants?

Do the social costs of some coal-fired power plants exceed their values? A new report from the Environmental Integrity Project (EIP) suggests that for a number of U.S. coal plants, their social costs as a result of premature deaths exceed the value of the electricity they generate.

In the report, the group examined the coal-fired plants “with the largest emissions of sulfur dioxide in 2010 and 2011 that do not yet have plans to install or upgrade scrubbers” and estimated the number of premature deaths from each plant and the cost of these deaths. The calculations were performed, according to the EIP, “using a peer-reviewed approach consistent with EPA methods.”

The report emphasizes the value of seeking cleaner and more efficient methods of electricity generation.

Coal helped to power America’s industrial revolution, and electricity is obviously vital to our economy today. But we have better choices now than we had more than forty years ago, when most of these plants were built. Investments in advanced emission controls can greatly reduce the dangerous buildup of fine particles, and investments in renewable energy and efficiency improvements can secure our supply of electricity – and generate the jobs we need – without the death and disease that are the price we pay for dirty coal plants.

An EPA hearing on coal in Frankfort, Kentucky this week prompted demonstrations from hundreds of coal miners and environmentalists. Miners protested the EPA’s hold on 36 permits for coal mines in the state, while environmentalists supported the EPA’s decision to delay the permits because of concerns relating to water pollution.

Seattle’s city council unanimously adopted a resolution last month opposing plans to develop coal-export terminals in Washington state. According to the Associated Press, “If all the facilities are built, at least 100 million tons of coal a year could be carried in trains through the Northwest before being shipped to Asia.

Below, find the 10 U.S. coal power plants with the highest social costs that exceed their electricity value. Read the full report here.

The Savannah Fund brings Silicon Valley to East Africa

The last several years have seen a blossoming of tech hubs and innovation centers across the African continent, as we reported earlier. In their wake, the growth of Africa-based venture capital organizations has turned a recognition of innovation into an anticipation of profit.

Tech Crunch’s Michael Butcher sketched a picture of the already-existing “accelerator and incubator” ecosystem there.

The latest to join this group is the Savannah Fund. It is noteworthy for its provenance. The three co-founders are Kenya native and White African blogger Erik Hersman, founder of Ushahidi, iHub and many other Africa-based tech projects; Tanzanian entrepreneur and Microsoft alumnus Mbwana Alliy; and Paul Bragiel co-founder and managing partner of i/o Ventures.

Read more | Comments

Eurozone finance ministers agree to 100 billion euro Spain bailout

After a conference call, which sources described as heated, the ministers said the amount of the bailout would be sufficiently large to banish any doubts

Which Apple WWDC Notebook Rumors Are Most Likely To Come True?


WWDC kicks off next week and in traditional fashion, a keynote headlines the event Monday morning. Much is expected from this year’s show including iOS 6 and new Macintosh desktops and laptops. So far the rumor circuit has been a buzz with talk of a complete hardware refresh including Apple bringing back the MacBook brand, adding a retina display to at least one model and finally employing Intel’s latest silicon that will also bring USB 3.0 to Macs for the first time.

What follows is the first post in a series rounding up nearly every rumor concerning Apple’s WWDC notebook announcements (iOS 6 and Mountain Lion to come) no matter how far-fetched or wild — some will likely come true and others probably won’t.

MacBook Pro Redesign


  • The MacBook Pro hasn’t seen a new design in two years
  • Several credible rumors state the same message of thinner design, no optical drive and USB 3.0


  • See next rumor

Judgment: Likely. The MacBook Pro is long overdue for some new digs. It’s a safe bet that if it doesn’t happen at WWDC — it is a developer’s conference after all — Apple will announce the new models in the coming weeks to get a head start on the lucrative back to school season.

A revival of the MacBook brand

  • Name would be just MacBook
  • Prices would start at $1399 for a 13-inch model, $1,799 for the 15-inch
  • No optical drive and optional SSD
  • Would eventually replace the MacBook Pro


  • Comes by way of AppleInsider sourcing a KGI analyst
  • MacBook is a known brand
  • The stats match up with previous rumors


  • A third line of Apple notebooks would cannibalize existing sales

Judgment: Possible. Apple is set to kill the optical drive in its notebooks, but doing so in the so-called Pro line would diminish ever so slightly the line’s professional brand.

New Intel Chipsets


  • The current MacBook, MacBook Pro lines use older Intel CPUs.
  • Intel is currently rolling out Ivy Bridge CPUs.
  • Apple generally uses the latest generation of Intel chips


  • Apple sometimes works in mysterious ways

Judgment: Highly likely if Apple announces notebooks at WWDC. Apple’s current notebook line use relatively antiquated Intel CPUs. It’s time for an update. If Apple doesn’t announce notebooks at WWDC, look for new notebooks with Ivy Bridge CPUs in the coming weeks.

USB 3.0 on the MacBook Pro


  • If Apple finally deploys Ivy Bridge CPUs, USB 3.0 is supported natively


  • Apple sometimes works in mysterious ways
  • Apple is pushing the competing high-speed interconnect standard of Thunderbolt.

Judgment: Highly likely if Apple announces notebooks at WWDC. This feature is dependent on the Intel chipset.

A retina display in a notebook


  • High resolution icons have been found in OS X
  • Next generation AMD and NVIDIA GPUs can push crazy resolutions


  • Super high resolution screens are very pricey
  • A higher system resolution could disrupt current applications and development

Judgment: Unlikely even though retina displays is a strong part of Apple’s product branding strategy. There is little benefit to roll out very expensive high resolution displays when there isn’t much built for the new resolution yet. If this is in the cards for future models, Apple might announce high resolution support alongside Mountain Lion.

17-inch MacBook Pro to get the ax


  • The 17-inch MBP is the least selling Apple notebook, capturing only 1.7% of sales in 1Q2012
  • A smaller, high resolution screen could replicate the workflow of larger screen


  • The 17-inch might not sell well, but it’s a true mobile workstation

Judgment: Won’t happen at WWDC. If true, this will likely come later this year. The cancellation of the 17-inch model is dependent on higher resolution screens that won’t likely be available in mass quantities until later this year or early next. A higher resolution 15-inch could in theory replicate the large screen of a lower resolution display like the one currently found in the 17-inch.

Look for two other posts in the coming days detailing iOS 6 and Mountain Lion’s rumors. WWDC 2012 is set to be the biggest developer’s conference yet.