Let’s blame in the stars! (a long tradition of not holding ourselves accountable)

Next we can blame witches.....

Rollercoaster financial markets and the worst riots Britain has seen in decades have made it quite a week for a time of year that is usually so dead the newspapers are filled with "silly season" tales of amusing pet antics.

Everyone is pointing fingers -- at blundering politicians, hooded thugs, disaffected youths, bumbling police and greedy bankers -- but could the cause for all the madness really be the star at the center of our solar system?

There isn't a lot of evidence pointing to little green men involving themselves in Earthly affairs, but the sun has been throwing bursts of highly charged particles into space in a phenomenon known as coronal mass ejections or CMEs.

Three large CMEs prompted U.S. government scientists to warn of solar storms that can cause power blackouts and the aurora borealis, or northern lights, caused by disturbances in the Earth's atmosphere, have been spotted as far south as England and Colorado, NASA said.

"Earth's magnetic field is still reverberating from a CME strike on August 5th that sparked one of the strongest geomagnetic storms in years", website SpaceWeather said.

Some academics have claimed that such geomagnetic storms can affect humans, altering moods and leading people into negative behavior through effects on their biochemistry.

Some studies have found evidence that hospital admissions for depression rise during geomagnetic storms and that incidents of suicide increase.

A 2003 study by the Federal Reserve Bank of Atlanta found that such storms could affect the stock market, as traders were more likely to make pessimistic choices.

"Unusually high levels of geomagnetic activity have a negative, statistically and economically significant effect on the following week's stock returns for all US stock market indices," the authors found in their report.

It could of course be mere coincidence that this has been a rollercoaster week on the markets, and that Britain was rocked by a wave of ferocious rioting and looting.

But market watchers may take comfort from the fact that the space weather forecast for Friday has gone quiet again.

They shouldn't be too complacent though. The solar cycle is on an upswing due to peak in 2013 and there are likely to be more geomagnetic storms heading Earth's way in the months to come.

Legal Hording

A string of warehouses in Detroit, most of them operated by Goldman, has stockpiled more than a million tonnes of the industrial metal aluminum, about a quarter of global reported inventories.
Simply storing all that metal generates tens of millions of dollars in rental revenues for Goldman every year.

There's just one problem: only a trickle of the aluminum is leaving the depots, creating a supply pinch for manufacturers of everything from soft drink cans to aircraft.

The resulting spike in prices has sparked a clash between companies forced to pay more for their aluminum and wait months for it to be delivered, Goldman, which is keen to keep its cash machines humming and the London Metal Exchange (LME), the world's benchmark industrial metals market, which critics accuse of lax oversight.

Analysts question why London's metals market allows big financial players like Goldman to own the warehouses which store huge quantities of metal even as they trade the commodity.

Robin Bhar, a veteran metals analyst at Credit Agricole in London says the conflict of interest is so acute he wants U.S. and European anti-trust regulators to weigh in.

"I think it makes a mockery of the market. It's a shame," Bhar said. "This is an anti-competitive situation. It puts (some) companies at an advantage, and clearly the rest of the market at a disadvantage. It's a real, genuine concern. And I think the regulators have to look at it."

Goldman said its warehouse subsidiary Metro International Trade Services has done nothing illegal, and abides by the LME's warehousing rules.

Goldman's warehouse business relies on a lucrative opportunity enabled by the LME regulations. Those rules allow warehouses to release only a tiny fraction of their inventories per day, much less than the metal that is regularly taken in for storage.

The metal that sits in the warehouse generates lucrative rental income.

Little wonder that so many want in. Metro was acquired by Goldman in February 2010, while commodities trading firm Trafigura nabbed UK-based NEMS in March 2010, and Swiss-based group Glencore International acquired the metals warehousing unit of Italy's Pacorini last September.

Henry Bath, a warehousing firm and founding member of the London Metal Exchange in 1877, has been owned for about 40 years by traders or banks including Metallgesellschaft in the 1980s and failed U.S. energy trader Enron at the turn of the century. It now comes under the umbrella of JP Morgan, which bought the metals trading business of RBS Sempra Commodities in July last year.

The long delays in metal delivery have buyers fuming. Some consumers are waiting up to a year to receive the aluminum they need and that has resulted in the perverse situation of higher prices at a time when the world is awash in the metal.

Nick Madden, chief procurement officer for Atlanta-based Novelis, which is owned by India's Hindalco Industries Ltd and is the world's biggest maker of rolled aluminum products. Madden estimates that the U.S. benchmark physical aluminum price is $20 to $40 a tonne higher because of the backlog at the Detroit warehouses. The physical price is currently around $2,800 per tonne.

Premiums for physical aluminum -- the amount paid above the LME's cash contract currently trading at $2,620 a tonne -- in the U.S. Midwest hit a record high of $210 a tonne in May, up about 50 percent from late last year. In Europe, the premium is at records above $200 a tonne, double the levels seen in January 2010.

The ripple effect into Asia has seen the premium paid in Japan increase 6 percent to $120 a tonne in the third quarter from the previous quarter, the first rise in nearly six quarters.