A Category 4 Hurricane

Before the 4th of July.

Today’s News Items is a two-parter. Part One is entirely devoted to political news. Part Two covers the other news. This is Part Two.

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1. Ferris Jabr:

(C)ontrary to long-held assumptions, Earth’s interior is not barren. In fact, a majority of the planet’s microbes, perhaps more than 90 percent, may live deep un­derground. These intraterrestrial microbes tend to be quite different from their counterparts on the surface. They are ancient and slow, re­producing infrequently and possibly living for millions of years. They often acquire energy in unusual ways, breathing rock instead of oxy­gen. And they seem capable of weathering geological cataclysms that would annihilate most creatures. Like the many tiny organisms in the ocean and atmosphere, the unique microbes within Earth’s crust do not simply inhabit their surroundings; they transform them. Subsurface microbes carve vast caverns, concentrate minerals and precious metals and regulate the global cycling of carbon and nutrients. Microbes may even have helped construct the continents, literally laying the ground­work for all other terrestrial life.

Like so much about Earth’s earliest history, exactly where and when life first emerged is not definitively known. At some point not long after our planet’s genesis, in some warm, wet pocket with the right chemistry and an adequate flow of free energy — a hot spring, an impact crater, a hydrothermal vent on the ocean floor — bits of Earth rearranged themselves into the first self-replicating entities, which eventually evolved into cells. Evidence from the fossil record and chemical analysis of the oldest rocks ever discovered indicate that mi­crobial life existed at least 3.5 billion years ago and possibly as far back as 4.2 billion years ago.

Among all living creatures, the peculiar microbes that dwell deep within the planet’s crust today may most closely resemble some of the earliest single-celled organisms that ever existed. Collectively, these subsurface microbes make up an estimated 10 to 20 percent of the biomass — that is, all the living matter — on Earth. Yet until the mid-20th century, most scientists did not think subterranean life of any kind was plausible below a few meters. Read the rest. (Source: nytimes.com)

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2. A stunning new wonderland has been discovered, hidden deep beneath the ocean waves of the Arctic Circle. Off the coast of Svalbard, in Norway, more than 3,000 meters (9,842 feet) down, a field of hydrothermal vents unfolds along the Knipovich Ridge, an underwater mountain range previously thought to be fairly unremarkable. Instead, like underfloor heating, volcanic activity below the seafloor causes heat to seep through, creating havens of warmth and chemical reactions where life can gather and thrive. The field, measuring at least a kilometer in length and 200 meters in width, has been named Jøtul, for the giants of Norse mythology that live beneath mountains. In this case, the giant is Earth's internal processes, released through cracks in the seafloor. "Water penetrates into the ocean floor where it is heated by magma. The overheated water then rises back to the sea floor through cracks and fissures," explains marine geologist Gerhard Bohrmann of the University of Bremen in Germany. "On its way up the fluid becomes enriched in minerals and materials dissolved out of the oceanic crustal rocks. These fluids often seep out again at the sea floor through tube-like chimneys called black smokers, where metal-rich minerals are then precipitated." (Sources: sciencealert.com, marum.de, wiktionary.org)

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3. The $1.3 trillion collateralized loan obligation market is about to become a victim of its own success because managers can’t create the bonds fast enough to meet demand and are running out of things to buy. A slowdown in mergers and acquisitions after borrowing costs rose is continuing to deprive the lenders of the leveraged loans that the industry was built on. About $311 billion of M&A deals have been announced and completed so far this year, roughly $1 trillion below the same level two years ago when interest rates began to rise, according to data compiled by Bloomberg. That may soon end up impacting the equity arbitrage — the gap between the yields that CLO managers can earn on the loans they buy and the bonds they sell — which may hurt new issuance in the coming months. It’s also sent more managers into the secondary market, where about 60% of loans now trade above par, making it that much harder to find bargains to put together a portfolio. (Source: bloomberg.com)

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