An Aquatic Two-Seater
These days, it’s not just navy officers — or British secret service agents — who get to drive submarines. User-friendly personal subs are being designed for wealthy yacht owners, too. One of the latest offerings is the battery-powered HP Sport Sub 2 made by Dutch submersible maker U-Boat Worx. Packing six horizontal and vertical thrusters, the two-person aquatic machine can reach depths of up to 330 feet and stay underwater for six hours. If something goes wrong during the dive into the deep blue, the mini-sub has a ping locator beacon system, emergency releasable buoy and an extra battery that can operate life support systems for up to 96 hours — enough time for the crew onboard the yacht to notice something is up and raise the alarm. At 4.5 feet high and weighing nearly 2.5 tons, the submersible can squeeze onto yachts measuring at least 100 feet and can be towed behind a car. The prospective owner just needs a spare $1.35 million. (Feb 2015)
Lights Out in Brazil?
Drought and high summer usage rates are taking their toll on Brazil’s hydropower plants, which provide more than three-fourths of the country’s electricity. Key reservoirs are down from 40 percent of maximum capacity last year to 17 percent in January. In 2001, the government started rationing electricity use when reservoirs were at a relatively full 21 percent, and Credit Suisse believes the odds of another bout of rationing have more than doubled from 23 percent in early December to 54 percent. If the past is any guide, rationing would tip off a steep decline in consumer spending and investment activity. In fact, analysts believe a year of forced cuts in electricity consumption, beginning in May, would reduce 2015 GDP growth by 1.1 percentage points to -1.5 percent. In this scenario, unemployment would increase and soaring food and electricity prices would push inflation up 0.7 percentage points to an eye-watering 7.8 percent. As a result, the central bank would likely be forced to raise interest rates from 12.25 percent to 14 percent by the end of 2015. The biggest risk, however, is that the hit to growth prompts ratings agencies to downgrade Brazil’s precarious sovereign credit rating. In Brasilia, they’re praying for rain. (Feb 2015)
Russia: More Bearish News
Cartoonists have portrayed Russia as a bear for centuries, and a teddy bear was even the mascot for the 1980 Moscow Olympic Games. But for locals and investors in the country, bearishness is getting old. Sanctions from the West, the Ukraine conflict and low oil prices will cause at least two years of recession, according to Credit Suisse. The rouble could depreciate further to 82 per dollar from 61 today, and central bank easing of interest rates is unlikely to boost economic activity since banks’ lending rates are still high. Among other problems, Credit Suisse expects foreign reserves to fall by $85 billion to $300 billion this year. In a worst-case scenario, a vicious cycle of falling reserves could make lenders nervous about a possible default, which in turn could cause capital flight. That scenario would likely lead to more currency intervention, and reserves could fall to a mere $190 billion. (Feb 2015)
JENS ERIK GOULD
Jens Erik Gould is a political, business and entertainment writer and editor who has reported from a dozen countries for media outlets including The New York Times, National Public Radio and Bloomberg News.