GMO–Monsanto Lose in Europe. (Nils Mulvad-Denmark)

GMO lose Europe – victory for environmental organisations

By:  | 29/05/2013 | Leave a Comment
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Monsanto will halt production of genetically modified corn in all of Europe, except Spain, Portugal and Czech republic. The agribusiness multinational states not to spend any more money on trials, development, marketing, court cases or anything else to get GM corn accepted in Europe.


Danish Ministry of Agriculture permalink

Leader of the state trial farm at Tystofte, Gerhard Deneken and former minister of agriculture Eva Kjer Hansen shows the story on GMO corn.



Quiet decision last year
”In Europe Monsanto only sells GM corn in three countries. GM corn represents less than 1% of the EU’s corn cultivation by land area. Field trials are only in progress in three countries. We will not spend any more money to convince people to plant them,” states Brandon Mitchener, Public Affairs Lead for Monsanto in Europe and Middle East, in an interview with Investigative Reporting Denmark.

The decision was taken quietly. The company found no reason to communicate it. This means that every agribusiness company has now given up on genetically modified crops in Europe – apart from selling them in Spain and Portugal.

Wikipedia on Genetically modified crops.

Effect on worldwide GMO-battle
“This is not surprising, knowing that BASF stopped its biotech research in Europe in 2012 and Syngenta moved its research years before. It will influence the international expansion of GMOs on a global scale,” comments Klaus Sall MSc.

Sall has been studying the politics of the GMO industry for several years, and is now working as a strategic business adviser. He has just written a status report on the development of GMOs in the EU for The Danish Ecological Association (Økologisk Landsforening).

BASF, Bayer and Syngenta halted their development of GMO potatoes in Europe in 2012, for the very same reasons as Monsanto – the battle was lost.

However green organisations are still fighting the agribusiness company – in Europe and the rest of the world.

”We are not a biotech company and NGOs campaigning against GM cultivation in Europe are beating a dead horse,” Brandon Mitchener points out.

Only Spain and Portugal face GMO-growth
In Czech Repulic the sale of GM corn declining, the only countries where it is on the rise being Spain and Portugal. Currently GM corn field trials are going on in just three countries: Romania, Slovakia and Czech Republic. They are done by academic partners of Monsanto or for EU variety registration. Totals here.

“We stopped most of the trials, including the trial in Denmark, following a strategic decision in 2011 to focus our commercial activity in Europe on high-performance, conventional hybrid seeds. Monsanto has a thriving business in Europe with conventional seeds and crop protection products. As a matter of principle, Monsanto will only seek to sell biotech seeds in countries where there is broad customer and political support for them as well as a functioning, science-based regulatory system – conditions which only apply in a few countries in Europe today,” says Brandon Mitchener.

Touch the GMO Maize

Former Danish minister of Agriculture and Food, Eva Kjer Hansen from The Liberal Party, Venstre, announced on September 16th 2009 the start of Monsantos three trials with GMO maize resistent to herbicide Round-Up (NK 603) in Denmark.

She told the press that in three years time Denmark could face acceptance of GMO crops and that a lot of farmers would be growing it. She invited journalists on a road trip and let them touch the GMO maize in the trial field in Tystofte near the Danish city Skælskør.

Even more trials

Two years later, in January 2011, Monsanto expanded these two years of examination with an additional year of testing, which was accepted by the Danish Environmental authority, Miljøstyrelsen.

The procedure is that crop companies’ new crops will be tested by the authority for two years before possibly being allowed for selling and growing in Denmark. At the time, Monsanto wanted to test a total of five different varieties with the transformation NK603.

Trial results are normally open to the public. In this case Monsanto explicitly asked to keep the test silent, and they withdrew the varities before the testing finished, so no results were published.

No information has then been released on these trials.

Fighting for access to trial results
Investigative Reporting Denmark has, together with an organisation for openness, Åbenhedstinget, asked for access to the results. It turns out the trials failed in the second year. On the 1st of February 2011 the authority stated that the GMO crops could not be allowed on the basis of the trial results of the first two years. The authority recommended one more year of trials.

The new maize crop resistant to Round-Up only performed 97 pct. compared to traditional maize for the two test years in total, the authority (Plantedirektoratet, Afdeling for Sortsafprøvning, Fagudvalget) writes. It also warns for the harmful effect of the herbicide Round-Up and concludes that the most realistic outcome is that the crop will not be allowed for growing in Denmark.

Monsanto cancelled the different crops from growing trials on different times. The last was cancelled on the 1st of February 2012. By doing that Monsanto could keep the failure out of the public domain.

Authorities support Monsanto on silence
The authorities have – after more than two months consideration – decided to follow Monsanto’s wish to keep the trial results silent.

Key documents in the FOI-case.
The main argument is that publication of the trial results would have an economically harmful effect on the company, despite the fact that the crops did not pass the trial.

Investigative Reporting and Åbenhedstinget together raise the case for The Danish Ministry of Agriculture. From a scientific viewpoint and for the use in other countries it is necessary to also get results of failed trials published, argue the two organisations.

“It is corrupting to the scientific method itself, when companies can decide that only positive results can be published. Therefore it is important to have this research published,” stresses Klaus Sall.

“This a good example of the need to require companies to accept free access to their GMO seeds, for scientific research, when the crop has been released for import to the EU as NK 603 has.”

Danish trial to be reported later

Brandon Mitchener from Monsanto points to a webpage where trials are reported. The Danish trials will be reported there later this year. The actual data from the trials are not included in the reports.

“I cannot believe that any company would ever voluntarily disclose information that might be useful to its competitors. It’s unrealistic, even surreal, that anyone would expect us to. Laws already strike the proper balance between confidentiality and transparency,” says Brandon Mitchener.

The horse is dead.

Experts getting moved away from GMO
In September 2009 The Danish Ministry for Agriculture and Food published a 235 page report on in an attempt to revitalise the debate and have GMOs allowed in Denmark. This took place on the same day as the roadtrip for the press to trial fields.

The report was met with a heavy criticism in the public debate. Today the topic is closed.

”Currently no agribusiness companies have GM varieties under testing for registration at The AgriFish Agency anymore,” explains Kristine Riskær, head of the center for farming and plants in the Danish State Authority for Farming, NaturErhvervsstyrelsen, a branch under The Danish Ministry for Agriculture and Food.

See 29. maj 2013: Nu er det slut med genmodificerede afgrøder i Danmark



BP. Russell McLendon

BP’s oiled animals: Where are they now?
Three years after the worst oil spill in American history, the Gulf of Mexico is shifting from acute aftermath to the uncharted waters of long-term rehab.
Tue, Apr 16 2013 at 3:36 PM

A column of smoke rises from the doomed Deepwater Horizon oil rig shortly after Earth Day in 2010. (Photo: National Commission on the Deepwater Horizon Oil Spill and Offshore Drilling)

For most Americans, the Deepwater Horizon oil spill ended a few months after it began. Oil giant BP finally capped the mile-deep Macondo oil well on July 15, 2010, and the U.S. government declared its summer-long scourge “effectively dead” by mid-September.
But across the northern Gulf of Mexico — which absorbed 200 million gallons of crude oil in 2010 — the disaster still isn’t over. This Earth Day marks its third anniversary, highlighting a gradual shift from in-your-face emergency to subtle, behind-the-scenes villain.
“You can think of an oil spill as an evolving event,” says Samantha Joye, who runs the University of Georgia’s Joye Research Group and has become a leading expert on the spill. “There are acute impacts — things like oiled birds and marine mammals, ecosystems that were altered. Then there are chronic consequences — long-term impacts where we might not see an immediate effect. The acute effects are fairly straightforward to assess, but the chronic effects are tricky because they require monitoring over a long period of time.”
Joye should know; her research group has been involved with 19 data-gathering cruises in the Gulf since the spill began, and she’s been onboard most of them. The cruises are part of a project called Ecosystem Impacts of Oil and Gas Inputs to the Gulf, or ECOGIG, that brings together 14 research institutions “to chart the long-term effects and mechanisms of ecosystem recovery from the Macondo blowout.” The project is currently funded through 2015, but Joye is hoping to stretch it out a little longer.
“We’re looking at a variety of sites around the wellhead and away from the wellhead, and the idea is to monitor these sites over nine years,” Joye tells MNN. “Right now we’re funded through the next three years, but we hope to extend it. Then we’d have nine years of data, which would put us in a pretty good position to say, ‘This is what happened, and this is what’s happening to the ecosystem.'”
An array of scientists are still studying the spill’s various victims, from microbes and deep-sea coral to fish, shrimp and dolphins. The Deepwater Horizon disaster is already one of the most intensely studied oil spills in history, but its size and complexity — not to mention the X factor of chemical dispersants — will likely warrant at least a decade of scrutiny. “We still don’t know what the long-term consequences of the spill are,” Joye says, “with respect to microbiology, fisheries, human health, essentially everything.”
For more on what we do know about the worst oil spill in American history, here’s a three-year checkup on some of the plants, animals and ecosystems it affected:
coastal wetland
The sun sets over a bayou near Larose, La., in July 2010. (Photo: Alex Ogle/AFP/Getty Images)
Coastal wetlands
More than 1,100 miles of shoreline were oiled by the Deepwater Horizon spill in 2010, according to data collected by the National Oceanic and Atmospheric Administration. Earlier this year, the Congressional Research Service estimated about 340 miles of those beaches and bayous remain “subject to evaluation and/or cleanup operations.”
In a new report for the spill’s third anniversary, the National Wildlife Federation argues that “cleaning up oiled wetlands is virtually impossible,” since both oil and efforts to remove it can kill coastal plants. As vegetation dies, the loss of roots speeds up erosion and converts land to open water — already a big problem in the Mississippi River Delta. The region has lost about 1,900 square miles of land in the past 80 years, largely due to manmade changes like flood-control levees, reshaped rivers for shipping, and dredged wetlands for oil and gas development. Extracting fossil fuels can also worsen the natural process of land subsidence, as can invasive species like nutria that eat native plants.
Without major swamp rehab — possibly funded by BP’s federal fines, the NWF points out — Louisiana is projected to lose another 1,750 square miles by 2060. That’s bad for wildlife, but about half of Louisiana’s human population also lives in coastal areas less than 3 feet above sea level. And since the Gulf’s wetlands are a natural buffer against hurricanes, their demise is especially ill-timed: On top of BP’s spill and the threat of others, the Gulf Coast must also deal with rising seas and stronger storms thanks to climate change.
oiled pelican
An oiled pelican tries to fly at Barataria Bay, La., in June 2010. (Photo: Win McNamee/Getty Images)
Pelicans, gulls and other seabirds were some of the most visible victims in the spill’s early days. Covered with crude that impeded their ability to swim or fly, they showed up helplessly on beaches and shorelines for months. Volunteers scrubbed their feathers with soap in a race to save them, but federal scientists nonetheless counted 6,147 birds killed by oil in the first year alone, compared with 1,252 that were cleaned and released.
The hardest-hit species was the laughing gull, with 2,981 collected from the spill area between April 2010 and May 2011. Nearly 1,200 of those were visibly oiled, according to the U.S. Fish and Wildlife Service, and more than 2,700 were already dead or died later.
Brown pelicans were No. 2, which was troubling given their history in the region. The birds had just come off the U.S. endangerd species list in 2009, thanks to 40 years of work to reverse their collapse from overhunting and DDT exposure. And while they’re no longer on the brink, with thousands now nesting in Louisiana alone, brown pelicans still took a hit from the BP spill. More than 800 were found stranded between April 2010 and May 2011, 40 percent visibly oiled and 70 percent dead or dying. And as the FWS notes, “the number of birds shown may represent only a portion of the total birds affected by the spill.”
Still, birds fall into the “acute” class of oil-spill casualties, Joye says. They’re mainly affected by thick crude on their feathers or in their stomachs, so the breakdown of oil plumes usually correlates with a drop in deaths. Of course, if oil is still killing wildlife further down the food web, the coast may not be clear for seabirds, either.
An oiled Kemp’s ridley sea turtle navigates the Gulf in June 2010. (Photo: Kate Sampson/NMFS)
Sea turtles
The Gulf of Mexico has five types of sea turtles, all of which are on the U.S. endangered species list. But one is particularly vulnerable, having invested almost exclusively in the Gulf as a nesting site while its four neighbors enjoy globe-circling ranges. And in a cruel twist of fate, the BP spill killed more of that species than all other turtles combined.
The Kemp’s ridley turtle lives along eastern North America from Mexico to Nova Scotia, and aside from occasional stops in the Carolinas or Florida, it only nests in the Gulf. Less than a year after the spill began, 809 of all known turtle strandings in the region were Kemp’s ridleys, according to NOAA, as were 481 of all known turtle deaths. By comparison, the agency reported 201 green sea turtles (29 dead), 16 hawksbills (none dead), 88 loggerheads (67 dead) and 32 undetermined species (all dead).
About 240 sea turtles are stranded along the U.S. Gulf Coast in a typical year, but more than 1,100 turned up during the BP spill’s first 12 months — including 450 visibly oiled and 600 dead or dying. And while the death rate is lower now, it has remained high enough to push the estimated three-year death toll past 1,700. Plus, as with birds, the NWF notes that “only a very small portion of dead sea turtles are ever found.”
A pod of striped dolphins swims past a Gulf oil slick on April 29, 2010. (Photo: Ron Wooten/NMFS)
Marine mammals
Whales and dolphins in the northern Gulf have been dying in droves for the past three years, leading NOAA to formally declare an Unusual Mortality Event (UME). As of April 2013, the UME involves 930 cetacean strandings, 95 percent of which were found dead. The die-off actually started in February 2010, two months before the BP spill, but its length and severity have raised concerns that oil made things worse.
Since NOAA began tracking Gulf UMEs in 1991, it has recorded 12 such events in cetaceans. The top two causes were morbillivirus and marine biotoxins, but NOAA’s tests “do not point to these as primary causes of deaths” this time. Thirteen bottlenose dolphins from the current UME have tested positive for Brucella, a bacterium that resembles flu in humans, and scientists are intrigued since it’s never been linked to a U.S. dolphin die-off before. Still, those 13 dolphins represent less than a quarter of all dolphins tested, and just 1 percent of the entire UME, so NOAA suspects this is bigger than Brucella.
cetacean UME
In Louisiana’s heavily oiled Barataria Bay, NOAA reports many dolphins’ symptoms are “consistent with those seen in other mammals exposed to oil,” but adds that it’s still investigating the cause. “The Barataria Bay dolphins have severe health problems that are not showing up in dolphins from the un-oiled area, and have not been seen in previous studies of dolphins from other sites,” NOAA says, noting the animals “are underweight, have low hormone levels, low blood sugar, and some show signs of liver damage.”
The Gulf boasts nine dolphin species and a variety of toothed whales, but this UME has hit bottlenose dolphins the hardest. Some 650 have been stranded so far, including at least 130 infant or stillborn calves. That may be partly due to their wide range of Gulf habitats, but these dolphins have also faced a barrage of environmental hardships lately. As one study pointed out last year, the spill was compounded by a severe winter, food shortages, bacterial infections and an influx of cold Mississippi River freshwater. “Unfortunately, it was a ‘perfect storm’ that led to the dolphin deaths,” the researchers concluded.
dead fish
A dead fish lies near Pass Christian, Miss., in May 2010. (Photo: Stan Honda/AFP/Getty Images)
Several fish kills struck the Gulf Coast in the spill’s wake, and reports of fish with open sores, strange black streaks and other deformities have continued years later. Yet linking this to oil has been difficult, and authorities say Gulf seafood is now safe. Fishing bans were lifted in the spill’s first year, and many Gulf fisheries are returning to normal.
One fish that isn’t back to normal, though, is the western Atlantic bluefin tuna. It was in trouble before the spill due to overfishing, which had cut its population by 82 percent since the 1970s, according to NOAA, but lately its outlook has been even bleaker. It only spawns in two areas of the northern Gulf, and the BP spill began during its April-May breeding season, oiling about 10 percent of its spawning habitat. Eggs and larvae are more sensitive to oil than adults, and the spill may have reduced the 2010 crop of bluefin babies by 20 percent, according to the NWF, with a potential 4 percent drop in future populations.
But there is hope for bluefin tuna in the Gulf, thanks in part to new fishing rules. NOAAlowered bluefin quotas after the oil spill, and also required anglers to use special “weak hooks” that are less likely to snag bluefin. Still, Joye advises cautious optimism for Gulf fish, citing delayed effects of the 1989 Exxon Valdez oil spill in Alaska. “After the Valdez spill, it didn’t become apparent that the herring fishery had collapsed for five years,” she says, adding a scientist’s caveat that “they’re very different ecosystems.”
A crab carcass lies near an oiled Mississippi marsh in April 2011. (Photo: Mario Tama/Getty Images)
The black tide washing into Gulf Coast marshes hurt countless shrimp, crabs, copepods and other crustaceans, with juveniles often faring worst. Shrimp losses were especially hard on the region’s famous seafood industry, which is rooted in a shrimping culture that dates back more than 200 years. Brown, white and pink shrimp seasons were closed for much of 2010, leading to Louisiana’s lowest annual shrimp harvest in decades.
But according to the NWF, shrimp are now one of the few bright spots in the Gulf’s recovery. The group rates their status as “good,” noting that Louisiana’s dismal 2010 shrimping season was followed by a 2011 harvest “commensurate with annual shrimp landings of the past two decades.” Despite some lingering reports of eyeless or otherwise deformed shrimp, the animals now seem relatively stable — good news for wild predators as well as humans, since one year’s shrimp harvest can bring more than $100 million to Louisiana alone. Shrimp are still only as healthy as their habitat, however, and the NWF cites the decline of coastal wetlands as a “long-term threat to shrimp.”
oil-eating microbes
Oil-eating microbes like these played a key role in the BP oil spill. (Photo: Lawrence Berkeley National Lab)
The smallest actors in the Deepwater Horizon drama may also be among the most important. Joye and other researchers have focused closely on the Gulf’s oil-eating bacteria, which played a key role in the spill by devouring up to 200,000 tons of loose oil. The microbes normally use this ability to get energy from natural oil and gas seeps, which are relatively small, but they swept into action when their habitat was flooded with crude. Joye has been tracking evidence of this, discovering new layers of seafloor sediment created by “marine snow,” or organic debris that sank from the microbes’ oily feasts.
In fact, Joye says the broad use of chemical dispersants in 2010 — often credited with preventing larger, thicker blobs of oil from reaching shore — may have been unnecessary, and possibly unwise. The Gulf already has a natural mechanism for breaking down oil, but BP and U.S. officials embraced dispersants like Corexit without controlled experiments to prove their benefit. And according to a study published in December, mixing Corexit with oil can make the oil 52 times more toxic to plankton.
At the same time, Joye also cautions against overestimating the bacteria. “I think they’ve played a very big role in consuming and altering the oil, but they certainly didn’t eat it all,” she says. “There’s still a lot of oil out there in certain places. There tends to be this incorrect assumption that the microbes ate all the oil.” While they do get energy from oil, she explains, they can’t get nutrients from it. “It’s important to keep in mind that if you keep pumping hydrocarbons into the system, you’ll eventually overwhelm it.”
A brittle starfish clings to dead coral on the Gulf floor in March 2012. (Photo: Charles Fisher/PSU/NSF)
Deep-sea coral colonies grow painfully slowly — a human fingernail grows up to 2,000 times faster — but they can persist for millennia, forming intricate networks along the seabed. This unfortunately put them on the front lines of the BP spill, though, and some of the Gulf’s ancient deep-sea reefs were damaged or killed. Surveys conducted shortly after the spill showed a range of responses, with relatively healthy colonies 12 or more miles away from the wellhead but more signs of distress closer to the source.
Coral research also supports Joye’s skepticism about using dispersants to fight oil spills. One recent study, for example, exposed two species of coral larvae to a series of mixtures that fell into three categories: oil from the Macondo well, Corexit dispersants and oil mixed with Corexit. Although the responses varied based on species and solution, all three led to lower settlement and survival rates — including Corexit by itself. In fact, exposure to Corexit 9500 resulted in “settlement failure and complete larval mortality” at doses of 50 to 100 parts per million. “I don’t think we know nearly enough about the impacts of Corexit,” Joye says. “I’m very nervous about using dispersants as a first line of defense in an oil spill, but I worry that’s the mentality we’re headed toward.”
The extent of damage to Gulf coral remains unclear, she adds, arguing it’s too soon to know despite “some evidence of recovery.” Yet given their growth rates, the NWF warns “recovery of dead and damaged corals to pre-spill conditions could take centuries.”
Vacationer Pete Duchock and his daughter, Maddie, survey oil residue from the Deepwater Horizon disaster at Orange Beach, Ala., in June 2010. (Photo: Joe Raedle/Getty Images)
Despite all the damage to wild plants and animals throughout the Gulf, no species was closer to the Deepwater Horizon disaster than humans. Eleven people died in the initial explosion that destroyed the rig, making it a human tragedy first and foremost.
Thousands upon thousands of people have also been affected in the three years since, and in a wide range of ways. Some were physically sickened by oil or its fumes during the cleanup, while others lost fortunes or entire businesses to prolonged slumps in fishing, shrimping and tourism. BP set up a $20 billion fund to compensate the spill’s myriad victims, of which about $8.2 billion has been distributed so far. The oil giant must also make amends with Gulf Coast residents in other ways: Last fall, it pleaded guilty to 12 felony charges as part of a $4.5 billion settlement with the U.S. government, the largest such fine in American history. It also reached a $7.8 billion settlement last spring with private-sector plaintiffs, and a civil trial is currently under way in New Orleans.
Humans’ relationship with the spill is complicated, however, by the fact it wouldn’t have occurred without us. While it was an accident by all accounts, there is ample evidence it could have been prevented. That was the first conclusion listed by the National Commission on the Deepwater Horizon Oil Spill and Offshore Drilling, which reported not only that spill was avoidable, but that its causes “can be traced to a series of identifiable mistakes made by BP, Halliburton and Transocean that reveal such systematic failures in risk management that they place in doubt the safety culture of the entire industry.”
A BP engineer was arrested last year for allegedly trying to destroy evidence about the spill, three employees have been charged with manslaughter in connection with the explosion, and an executive has been charged with lying to investigators about how much oil was leaking. The U.S. Justice Department has accused BP of gross negligenceand a “culture of corporate recklessness,” but the oil spill commission casts broader blame: “Deepwater energy exploration and production, particularly at the frontiers of experience, involve risks for which neither industry nor government has been adequately prepared.”
There’s not much anyone can do now to help wildlife overcome the spill, Joye says, aside from keeping a close ecological eye on the northern Gulf. But even if it is too soon to judge the region’s recovery, there may still be important lessons to learn in the meantime.
“I think the biggest thing we’ve learned is the variability in response time,” she says. “Some parts of the system seem to be responding pretty quickly and approaching pre-spill conditions, and others are still not functioning correctly.” Beyond appreciating the complexity of the Gulf’s comeback, Joye also suggests reflecting on our own roles in the disaster. “This entire incident is a call to arms. People need to be aware of the consequences of deepwater drilling and aware of how they use energy,” she says. “We all play a critical role in the sustenance of the planet, and we need to be good stewards.”
Related oil spill stories on MNN:

AAPL: APS generate more margin contribution than Ipods.

From Elephant Analytics.

The Apple (AAPL) App Store has been extraordinarily successful with third-party apps, having reached the 50 billion download mark earlier in May. However, Apple CFO Peter Oppenheimer mentioned in 2010 that the App Store operated a bit over break-even. As well, Piper Jaffray’s Gene Munster estimated in July 2011 that Apple only made $292 million in profitfrom 15 billion downloads. The prevailing wisdom since then was that the App Store only plays a minimal direct role in Apple’s profitability and serves mainly as an incentive to purchase Apple hardware due to the strong ecosystem. We are going to show that this situation has changed and that the App Store is playing an increasingly significant role in Apple’s profitability (although still fairly small percentage wise). Note that we are only focusing on third-party apps in this article, and not addressing Apple’s own software sales or other items.

Revenue Per Download

Apple mentioned that they reached 45 billion app downloads on its most recent earnings call, with $9 billion paid to developers at that time. Thus an average of $0.20 is paid to developers per app download (combined free and paid). It appears that this $0.20 per download rate is fairly constant based on checks at other times over the past few years.

Since developers get 70% of total app revenues, we can extrapolate that the average revenue per app download is $0.2857 (based on $0.20 divided by 70%). Apple gets to keep 30% of total app revenues, which works out to an average of $0.0857 per app download. From this share they need to pay for storage and delivery costs as well as credit card processing fees.

We are analyzing the numbers for all app downloads since the distinction between paid and free apps is now blurred with the increasing importance of in-app purchases. Distimo now estimates that 71% of iPhone revenue comes from in-app purchases from within free apps, with another 5% from in-app purchases within paid apps.

Storage and Delivery Costs

The size of the average iOS app was 23 MB in October 2012. App sizes are quickly getting larger, so the current average size may be around 26 MB. The average number of updates released was 3.89 per app according to another survey.

The total amount of storage required for 850,000 apps is 25,500 GB if we assume 26 MB per app plus another 4 MB per app in associated screenshots. Amazon S3 storage pricing is $0.055 per GB per month for the lowest tier. Apple should be able to achieve lower costs than what Amazon charges to customers, but if we use the Amazon pricing, the cost of storing 850,000 apps works out to only $16,830 per year, which is a negligible cost per download when you are looking at 20 billion downloads per year.

If we assume that each user downloads all the updates for an app, their total lifetime download per app would be 26 MB for the original download plus 104 MB for four updates per app. This equals 130 MB. The lowest published prices for Amazon S3 data transfer out is $0.05 per GB. As per before, Apple should be able to achieve lower costs. However, at this price it works out to $0.0065 per downloaded app for delivery costs. Combined storage and delivery costs are therefore around $0.0066 per downloaded app.

Credit Card Costs

Credit card processing costs represent a major cost to Apple. Due to a high fixed cost per transaction, microtransactions can be particularly costly. At 15 cents per transaction + 2%, a $0.99 app sale could cost $0.17 in credit card fees, which is 17.2% of the total app cost. Since Apple takes a 30% cut of app sales, this fee may represent over half of Apple’s share.

However, trends in app store revenue sources have served to greatly reduce credit card processing costs for Apple. In-app purchases represented 36% of iPhone app revenue back in June 2010, which is a few months after Oppenheimer first made his break-even comments. This has increased to 76% now and is significant due to recent information that shows that in-app purchase revenue is actually driven mainly bylarge transactions ($9.99 and up) instead of microtransactions as previously though, which makes the relative credit card processing fees lower as a percentage of revenue.

Here’s a look at estimated in-app purchase amounts by transaction size. $9.99 transactions account for 23% of total revenue and have a credit card fee that is 3.5% of the $9.99 transaction value. Thus it contributes 0.81% to the overall total (23% times 3.5%). The result is that in-app purchases have a credit card processing fee that is estimated at 4.31% on average.

Transaction Amount % of Total Revenue Generated By Transaction Amount Credit Card Fee

Per Transaction

Credit Card Fee (% of Transaction) Weighted Credit Card Fee (As % of Total Revenue)
$0.99 1% $0.17 17.2% 0.17%
$1.99 6% $0.19 9.5% 0.57%
$2.99 15% $0.21 7.0% 1.05%
$4.99 8% $0.25 5.0% 0.40%
$6.99 2% $0.29 4.1% 0.08%
$9.99 23% $0.35 3.5% 0.81%
$14.99 11% $0.45 3.0% 0.33%
$19.99 24% $0.55 2.8% 0.67%
$24.99 2% $0.65 2.6% 0.05%
$49.99 8% $1.15 2.3% 0.18%
Average 100% 4.31%

In-app purchases account for 76% of revenue. That leaves 24% for the upfront revenues from paid apps. To be conservative, we’ve split the 24% among $0.99 transactions and $1.99 transactions equally. In reality there are a lot of higher cost apps. The result is that credit card processing fees should be no more than 6.48% of total revenues.

% of Revenue Credit Card Processing Fee Credit Card Fee Weighted as % of Revenue
Paid Apps @ $0.99 12% 17.2% 2.06%
Paid Apps @ $1.99 12% 9.5% 1.14%
In App Purchases 76% 4.31% 3.28%
Total 100% 6.48%

There are also a couple of ways that Apple can reduce credit card processing fees. One way is through combining transactions into one charge. Instead of billing five $0.99 purchases separately, if the purchases are done around the same time, Apple can make one charge for $4.95. This would serve to reduce the credit card processing fee from $0.85 to $0.25. As well, purchases made via gift cards would not have the microtransaction issue to deal with.

We are therefore going to estimate that Apple pays an average of 6% of gross receipts in credit card processing costs, making the cost per download $0.0171 (based on 6% times $0.2857 per app download).

Apple’s Gross Margin

If we compile all this information together, we get the following table. Apple’s gross margin is around 6.2 cents per download.

Per Download
Total Revenue $0.2857
Developer Share $0.20
Storage and Delivery Costs $0.0066
Credit Card Costs $0.0171
Apple’s Gross Margin $0.062

Here is a separate pie chart to illustrate where all the revenue goes.

(click to enlarge)

Download rates for the App Store have been around 2 billion per month recently. The below table shows what gross margins look like under various volume scenarios. At around 2 billion downloads per month (25 billion per year), Apple makes $1.55 billion in gross margin per year. Of course there are additional costs involved with maintaining the servers and building out additional App Store features, as well as customer service costs. However, it seems fair to say that Apple makes over $1 billion per year from third-party apps in the App Store even if all that is factored in.

Number of Downloads (Billion) 20 25 30
Gross Margin Per Download $0.062 $0.062 $0.062
Gross Margin ($ Billion) 1.24 1.55 1.86


The App Store has developed into a major profit source for Apple. While it once operated a little above break-even, the massive growth of downloads plus some significant cost reductions now means that the App Store now makes over $1 billion per year for Apple, and represents about 2-3% of its overall gross margin. It has passed the iPod in terms of overall margin contribution, and could contribute near $3 billion in gross margins per year by 2017 if they do close to 40 billion downloads per year with some reduced costs. That would make sales third-party apps worth around 50% of the entire Mac line in terms of gross margins.

Texas Beans

A sample from Texas Kitchen, a great cooking blog:

Jeff’s Beans. (you can start all the beans from scratch)

Jeff was my best friend’s brother-in-law when I was in college. He made some killer beans.  I don’t know if there was ever actually a written recipe, but this is my rendition of them.  A little bit sweet and a lot of savory, they are good with anything that you would serve with pinto beans or baked beans.

  • 1 pound bacon, chopped
  • 2 green bell pepper, diced
  • 1 large onion, diced
  • 5 cloves garlic, minced
  • 1 bunch parsely, chopped
  • 2 cans (15oz each) of black eyed peas
  • 2 cans (15 oz each) pork and beans
  • 2 cans (15 oz each) field peas with snaps
  • 2 cans (15 oz each) crowder peas (if not available, use 1 more each of black eyes and pork and beans)
  • 1 T cajun seasoning (I use Tony Chachere’s)

Cook bacon in dutch-oven or soup pot over medium heat until bacon is almost crispy. Add chopped peppers, onions and garlic, and cook until softened. Stir in parsley and heat for 2 minutes. Add all beans (do not drain) and seasoning, and reduce heat to medium low. Cover and cook for 30 minutes.

You can also cook the bacon and vegetables ahead of time, and then throw everything in a crock pot for slow cooking.


APPL: Gary Cheng. Playing the WWDC Event.


Apple (AAPL) will kick off its annual Worldwide Developers Conference (WWDC) on June 10, 2013 in San Francisco. Every year, Apple utilizes this event to unveil a range of upgrades or new additions to its hardware and software line-up. As the table below shows, Apple typically releases major operating system upgrades to its iOS for smartphones/tablets or Mac OS X for Macs at the event. There were times when Apple would also showcase new hardware upgrades such as new iPhone or improved Macbook Pro/Air laptops.

(click to enlarge)

(Source: Apple)

Apple’s secrecy is well documented and has been successful at keeping investors in the dark on most future products including features and release timing. Similarly, it has kept quiet on what will be announced at this WWDC event. As we are closing in on June 2013, there has already been much discussions, rumors, and media conjectures regarding what Apple will make public at the event. Therefore, the WWDC can turn into one of the few occasions during the year in which Apple communicates to the investor and user community to provide valuable new information with better clarity which investors can put to use in realigning their near term expectation on the strategic direction that the company is undertaking.

USAToday and tech news site Digital Trends have a good round up of the general expectation of what Apple will make public at the event which is consistent with my read of various media reports and industry analysts comments. Apple is widely expected to announce the new iOS 7 and possibly Mac OS X 10.9. Reports from CNETGigaom, and others also suggest that the new iOS 7 look-and-feel would represent a new departure in design style. However, most of the new features rumored to be incorporated look to be more evolutionary iterations of improvement rather than revolutionary.

According to comments from KGI Securities analyst and Digitimes reports, Apple is also preparing to update Macbook Pro/Air laptops at the WWDC event. Since Intel just recently released its Haswell processor for personal computers that offers impressive power-saving features along with a powerful CPU, I will not be surprised that Apple will quickly update their Macs to make use of the new features in order to ramp up sales. However, I believe it’s unlikely that incremental increase of Mac sales would be able to add much to the bottom line of Apple which derives substantially most of its revenue from iPhone and iPad sales. There are a long list of other products rumored to be in the works or predicted to be available soon by Wall Street analysts and others on iPhone 5S, a low cost iPhone, a larger-screen iPhone, iPad Mini 2, iPad 5, iWatch, iTV, and iRadio, but their imminent release in June seem not to be highly anticipated. In a sense, investors and the media seem to think that this WWDC event will be mostly about software and have low expectation on the release of other major hardware updates.

Under this context, a trade buying Apple shares prior to the WWDC event and then exiting after the event could potentially be profitable. This event driven trade is meant to exploit current low expectation and seeks to take advantage of and capture any big upside surprise that might have come out of the WWDC event which I believe the market has not priced in.

I backtested this event trading strategy using trading data before and after the annual WWDC event from 2007 – 2012. My strategy involves buying Apple shares on the two Fridays prior to the event and then exiting the position on the second to sixth Fridays post the event with holding period lasting from 28 – 56 days. There are a number of ways this strategy could be backtested with variations in how early investors want to buy Apple shares and the length of the holding period and may show different results.

(click to enlarge)

Although there were only six annual data points in my study, the results nevertheless provided the following insights:

  • There was fairly strong short term correlation between the WWDC event and Apple share price. The strategy was profitable for 4 out of 6 years (67%) if the stock was held for 28 – 35 days with an average return of 5%. If holding period is extended to 42 – 56 days, the success rate increased to five out of six years (83%) and the average return also rise to 6% – 10%.
  • In the early years of 2007 – 2010 when iPhone was the only dominant smartphone in the market, initial reaction after each announcement was very positive and it was reflected in the strong share price. 2008 was probably an anomaly due to the ongoing financial crisis at that time.
  • The return was negative in 2011 when Apple suddenly decided to de-couple the release of the new iPhone hardware with the iOS upgrade and the market seemed to be negatively surprised. However, in 2012 when Apple again followed suit, the market was not as negatively surprised and instead focused on the other positive aspects of the event.
  • Downside risk has previously been limited – from -3% to -9% – depending on the holding period.
  • A hardware upgrade together with a software refresh (2008 – 2010) would have a much bigger positive impact than just a software refresh (2011 – 2012).

Compared to a few weeks ago, Apple’s chart is showing a markedly improved technical position. Its share price has stopped declining and is beginning to move sideways between the range of $420 – $460 to build a bottoming formation. A big upside surprise from the WWDC event could be the catalyst needed to help move share prices back above $500 level. The sideway share price movement can also help to mitigate the downside risk of this trade in the event that investors are underwhelmed by the WWDC announcements.

(click to enlarge)

AAPL: Short the Bonds? Long the Stock?

Devon Shire interprets Jim Grant.


Jim Grant thinks that the actions of the Central Banks around the world are creating artificial pricing in certain assets. Specifically fixed income.

When all of that quantitative easing ends asset prices are going to go back to being priced based on market forces rather than central bank easing.

Investors worldwide are chasing fixed income yield to ridiculously low levels.

This artificial pricing in the market means that there is potential for value focused investors to profit when the Central Government intervention ends.

Grant believes that Apple (AAPL) is a perfect example of the currently distorted market pricing being created by easy money policy. It also creates a way to profit from the ending of quantitative easing.

(click to enlarge)

Why Should We Listen To Jim Grant?

Is Jim Grant a man we should listen to?

To find out for myself I went back and looked at Jim Grant’s track record to try and see how reliable he is.

Grant of course is the author of Grant’s Interest Rate Observer and a man with thirty years experience. That brings with it a 30-year track record from which we can assess his ability. So what do we know about Grant?

First off, that he makes a lot of sense. His opinions are well researched and his conclusions sensible.

Second, we know that his track record suggests he is worth paying attention to. He has made the following calls:

– When Treasury bonds were yielding 13% in the early 1980s, Grant called them a screaming buy. Everyone else was screaming too back then, but they were screaming that “cash is trash” and wanted no part in currency-based investments.

Grant figured that if inflation, then coming down, suddenly ran amok again, an investor could in the worst case give up 13% a year in principle and still break even on the coupon. If he was right then the best case was much more rewarding.

History tells us that Grant was dead on the mark. Buying Treasury bonds in the early 80s was one of the great investing opportunities of the last century as interest rates of dropped continuously since.

– In 1999 when growth and technology stocks were reaching absurd valuations, Grant wrote “Great booms… produce large abuses, which usually do not seem abusive until after the up cycle ends.” He had been warning his readers to steer clear of this sector as early as 1997.

History tells us that Grant was dead on the mark. Technology stocks collapsed in 2000 and most have still not recovered to the prices of the late nineties.

– As early as 2005 Grant was telling his readers that shorting the securitized lending market was going to be a great bet and at the very least that they should avoid exposure to it. His thinking was that if he was wrong on his short thesis the worst result was that a bond priced at $100 would go to $101, and if he was right he would make a bundle.

History tells us again that Grant was dead on the mark. Investors like Dr. Michael Burry and John Paulson made fortunes profiting from shorting garbage pools of loans.

He seems like someone we should consider an opinion from to me.

What Grant is saying today is to buy Apple stock and short Apple bonds.

Explaining The Logic Behind Shorting Apple Bonds and Buying Apple Stock

Grant believes that when investing an investor has to look at valuation of individual securities independent of the overall market.

He believes that right now most market participants aren’t doing that and Apple bonds and stock provide a perfect example of that.

Recently Apple sold the largest corporate bond deal in history when it issued $17 billion in bonds at the following yields:

– 10 years at 2.41%

– 3 years at 0.51%

– 5 years at 1.076%

– 30 years at 3.883%

There were $52 billion in offers for the $17 billion in debt being offered making it one of the most hotly desired bond issues in recent memory.

Investors literally couldn’t get enough of these bonds.

Now keep those yields in mind when looking at Apple stock.

The current dividend yield for Apple is 2.4%. That is equal to the yield on the 10 year Apple bond. The yields are exactly the same, but the equity holder gets to participate in Apple earnings going forward as well.

The free cash flow yield on Apple is even more attractive. Right now it is approaching 11%. So while the Apple 10 year bond holder gets an annual return of 2.4% the Apple equity holder is receiving a free cash flow yield of 11%.

Some of that free cash flow yield comes back to the shareholder as a dividend, some through share repurchases and the rest through reinvestment in the business which will grow value per share.

I think those numbers make it obvious that choosing Apple bonds over Apple equity is a terrible decision. Grant quantifies that for us to make it even more evident through the following hypothetical situation:

“Assume that the Apple share price goes nowhere over the next ten years and free cash flow accumulates at only half the rate of the past five years. At the end of the ten years with the build up of cash on the balance sheet the free cash flow yield on the common stock is going to have a free cash flow yield of 145%.”

While the equity holders after ten years under those assumptions Grant uses (possibly conservative ones) will be receiving a free cash flow yield of 145%, the bond holders will be receiving 2.4%.

In this ultra low interest rate world investors are doing crazy things for yield, and buying Apple bonds at these rates while ignoring Apple stock is one of them.

Grant thinks the Apple bonds are excellent short sale candidates and pairing that by buying Apple equity might be a good idea.

Makes sense to me.

Roundup Ready: Destroying your Body without Noticing It.

Research Reveals Previously Unknown Pathway by which Glyphosate Wrecks Health

May 14, 2013 |

By Dr. Mercola

The more we learn about genetically engineered (GE) foods, the clearer the dangers become. I’ve warned you of the potential dangers of GE foods for many years now, as I was convinced that the artificial combining of plants with genes from wildly different kingdoms is bound to cause problems.

As the years roll on, such suspicions are becoming increasingly validated. In recent weeks, we’ve not only learned that GE corn is in no way comparable to natural corn in terms of nutrition, we’re also discovering the ramifications of dousing our crops with large amounts of glyphosate — the active ingredient in Monsanto’s broad-spectrum herbicide Roundup.

GE crops are far more contaminated with glyphosate than conventional crops, courtesy of the fact that they’re engineered to withstand extremely high levels of Roundup without perishing along with the weed.

A new peer-reviewed report authored by Anthony Samsel, a retired science consultant, and a long time contributor to the Vital Votes Forum and Dr. Stephanie Seneff, a research scientist at the Massachusetts Institute of Technology (MIT) has fortunately received quite a bit of mainstream media attention.

Their findings, along with the development of another breed of “gene silencing” crops, makes the need for labeling all the more urgent, and the advice to buy certified organic all the more valid.

How Glyphosate Worsens Modern Diseases

While Monsanto insists that Roundup is safe and “minimally toxic” to humans, Samsel and Seneff’s research tells a different story altogether. Their report, published in the journal Entropy,1 argues that glyphosate residues, found in most commonly consumed foods in the Western diet courtesy of GE sugar, corn, soy and wheat, “enhance the damaging effects of other food-borne chemical residues and toxins in the environment to disrupt normal body functions and induce disease.” According to the authors:

“Negative impact on the body is insidious and manifests slowly over time as inflammation damages cellular systems throughout the body.”

The main finding of the report is that glyphosate inhibits cytochrome P450 (CYP) enzymes, a large and diverse group of enzymes that catalyze the oxidation of organic substances. This, the authors state, is “an overlooked component of its toxicity to mammals.”

One of the functions of CYP enzymes is to detoxify xenobiotics—chemical compounds found in a living organism that are not normally produced or consumed by the organism in question. By limiting the ability of these enzymes to detoxify foreign chemical compounds, glyphosate enhances the damaging effects of those chemicals and environmental toxins you may be exposed to.

Dr. Stephanie Seneff has been conducting research at MIT for over three decades. She also has an undergraduate degree in biology from MIT and a minor in food and nutrition, and I have previously interviewed her about her groundbreaking insights into the critical importance of sulfur in human health. Not surprisingly, this latest research also touches on sulfur, and how it is affected by glyphosate from food.

“Here, we show how interference with CYP enzymes acts synergistically with disruption of the biosynthesis of aromatic amino acids by gut bacteria, as well as impairment in serum sulfate transport,” the authors write.

“Consequences are most of the diseases and conditions associated with a Western diet, which include gastrointestinal disorders, obesity, diabetes, heart disease, depression, autism, infertility, cancer and Alzheimer’s disease.

We explain the documented effects of glyphosate and its ability to induce disease, and we show that glyphosate is the ‘textbook example’ of exogenous semiotic entropy: the disruption of homeostasis by environmental toxins.”

The Link Between Your Gut and the Toxicity of Glyphosate

The impact of gut bacteria on your health is becoming increasingly more well-understood and widely known. And here, we see how your gut bacteria once again play a crucial role in explaining why and how glyphosate causes health problems in both animals and humans. The authors explain:

“Glyphosate’s claimed mechanism of action in plants is the disruption of the shikimate pathway, which is involved with the synthesis of the essential aromatic amino acids, phenylalanine, tyrosine, and tryptophan. The currently accepted dogma is that glyphosate is not harmful to humans or to any mammals because the shikimate pathway is absent in all animals.

However, this pathway is present in gut bacteria, which play an important and heretofore largely overlooked role in human physiology through an integrated biosemiotic relationship with the human host. In addition to aiding digestion, the gut microbiota synthesize vitamins, detoxify xenobiotics, and participitate in immune system homeostasis and gastrointestinal tract permeability. Furthermore, dietary factors modulate the microbial composition of the gut.”

As noted in the report, incidences of inflammatory bowel diseases and food allergies have substantially increased over the past decade. According to a recent CDC survey, one in 20 children now suffer from food allergies2 — a 50 percent increase from the late 1990’s. Incidence of eczema and other skin allergies have risen by 69 percent and now affect one in eight kids. Samsel and Seneff argue it is reasonable to suspect that glyphosate’s impact on gut bacteria may be contributing to these diseases and conditions. They point out that:

“…Our systematic search of the literature has led us to the realization that many of the health problems that appear to be associated with a Western diet could be explained by biological disruptions that have already been attributed to glyphosate.

These include digestive issues, obesity, autism, Alzheimer’s disease, depression, Parkinson’s disease, liver diseases, and cancer, among others. While many other environmental toxins obviously also contribute to these diseases and conditions, we believe that glyphosate may be the most significant environmental toxin, mainly because it is pervasive and it is often handled carelessly due to its perceived nontoxicity.

[T]he recent alarming increase in all of these health issues can be traced back to a combination of gut dysbiosis, impaired sulfate transport, and suppression of the activity of the various members of the cytochrome P450 (CYP) family of enzymes.”

Former Navy Scientist Exposes Health Hazards of Glyphosate

Former US Navy staff scientist Dr. Nancy Swanson has a Ph.D. in physics, holds five US patents and has authored more than 30 scientific papers and two books on women in science. Ten years ago, she became seriously ill, and in her journey to regain her health she turned to organic foods. Not surprisingly (for those in the know) her symptoms dramatically improved. This prompted her to start investigating genetically engineered foods.

She has meticulously collected statistics on glyphosate usage and various diseases and conditions, including autism. A more perfect match-up between the rise in glyphosate usage and incidence of autism is hard to imagine… To access her published articles and reports, please visit Sustainable Pulse,3 a European website dedicated to exposing the hazards of genetically engineered foods.

According to Dr. Swanson:4

“Prevalence and incidence data show correlations between diseases of the organs and the increase in Genetically Modified Organisms (GMOs) in the food supply, along with the increase in glyphosate-based herbicide applications. More and more studies have revealed carcinogenic and endocrine disrupting effects of Roundup at lower doses than those authorized for residues found in Genetically Modified Organisms.”

“The endocrine disrupting properties of glyphosate can lead to reproductive problems: infertility, miscarriage, birth defects, and sexual development. Fetuses, infants and children are especially susceptible because they are continually experiencing growth and hormonal changes. For optimal growth and development, it is crucial that their hormonal system is functioning properly.

The endocrine disrupting properties also lead to neurological disorders (learning disabilities (LD), attention deficit hyperactive disorder (ADHD), autism, dementia, Alzheimer’s, schizophrenia and bipolar disorder). Those most susceptible are children and the elderly.”

Warning! EPA Raises Limits for Allowable Glyphosate Residues

Amazingly, just as more independent reports are emerging confirming the health hazards of glyphosate and GMOs, the Environmental Protection Agency5 (EPA) is proposing to RAISE the allowed residue limits of glyphosate in food and feed crops! As reported by GM Watch 6:

“The allowed level in teff animal feed will be 100 parts per million (ppm); and in oilseed crops, 40 ppm. Allowed levels in some fruits and vegetables eaten by humans will also rise.”

Root and tuber vegetables, with the exception of sugar, will get one of the largest boosts, with allowable residue limits being raised from 0.2 ppm to 6.0 ppm. The new level for sweet potatoes will be 3 ppm.

“As a comparison, malformations in frog and chicken embryos were documented7 by Prof Andres Carrasco’s team at 2.03 ppm glyphosate, when injected into the embryos,” GM Watch writes.

Yet despite all the evidence, the EPA rule states:

 “EPA concludes that there is a reasonable certainty that no harm will result to the general population or to infants and children from aggregate exposure to glyphosate residues.”

Monsanto has in fact petitioned and received approvals for increases in residue levels for several crops. Why? Because the weeds are getting increasingly resistant, requiring farmers to increase the amount of Roundup they have to spray just to keep up with the superweeds created by the excessive use of the chemical in the first place…

The Rise of Superweeds

A recent article in Nature Magazine8 addressed some of the environmental and societal concerns associated with genetically engineered crops. One of them is the rise in crop-destroying superweeds, as weeds develop resistance to glyphosate. This was yet another possibility that was initially pooh-pooh’d by Monsanto. However, truth has a way of eventually becoming self evident, and now glyphosate resistance is becoming so obvious the facts are hardly disguisable. According to the article:

“As late as 2004, the company was publicizing a multi-year study suggesting that rotating crops and chemicals does not help to avert resistance. When applied at Monsanto’s recommended doses, glyphosate killed weeds effectively, and ‘we know that dead weeds will not become resistant,’ said Rick Cole, now Monsanto’s technical lead of weed management, in a trade-journal advertisement at the time.

The study,9 published in 2007, was criticized by scientists for using plots so small that the chances of resistance developing were very low, no matter what the practice.

Glyphosate-resistant weeds have now been found in 18 countries worldwide, with significant impacts in Brazil, Australia, Argentina and Paraguay… And Monsanto has changed its stance on glyphosate use, now recommending that farmers use a mix of chemical products and ploughing. But the company stops short of acknowledging a role in creating the problem…

Source: Ian Heap, International Survey of Herbicide Resistant (2013)


To offer farmers new weed-control strategies, Monsanto and other biotechnology companies, such as Dow AgroSciences, based in Indianapolis, Indiana, are developing new herbicide-resistant crops that work with different chemicals, which they expect to commercialize within a few years.”

What the author fails to mention is that some of these new herbicide-resistant crops are being designed to withstand chemicals that could be even more destructive, both environmentally and with regards to human health—especially in light of Samsel and Seneff’s new research.

For example, Dow AgroSciences has developed a new generation of genetically modified (GM) crops — soybeans, corn and cotton — designed to resist a major ingredient in Agent Orange, the herbicide called 2,4-Dichlorophenoxyacetic acid (2,4-D).

The use of 2,4-D is not new; it’s actually one of the most widely used herbicides in the world. What is new is that farmers will now “carpet bomb” staple food crops like soy and corn with this chemical at a previously unprecedented scale—just the way glyphosate has been indiscriminately applied as a result of Roundup Ready crops. In fact, if 2,4-D resistant crops receive approval and eventually come to replace Monsanto’s failing Roundup-resistant crops as Dow intends, it is likely that billions of pounds will be needed, on top of the already insane levels of Roundup being used (1.6 billion lbs were used in 2007 in the US alone).

Gene Transfer Hazards, and the Latest ‘Gene Silencing’ Crops

Nature Magazine also discusses the spread of transgenes to wild crops. Mexico in particular has reported the spread of GE corn despite the fact that GE crops are not approved for commercial planting in Mexico. It is believed that the transgenes originated in corn imported from the US, and that local farmers may have planted some of the corn originally purchased for consumption, not realizing they were genetically engineered.

Cross-breeding between native and GE varieties may have allowed for the continued spread of transgenic DNA. Sadly, once present, it’s virtually impossible to get rid of these transgenes, which means that native species may eventually be eliminated entirely—a fate that cuts deep into the heart of the Mexican people, where corn is considered sacred.

Latest Breed of GE Crops Can Silence Your Genes… What Then?

Australia’s Commonwealth Scientific and Industrial Research Organization (CSIRO) has developed a type of genetically engineered (GE) wheat that may silence human genes, which could have truly disastrous health consequences.

Last year, University of Canterbury Professor Jack Heinemann released results from genetic research he conducted on the wheat, which unequivocally showed that molecules created in the wheat, intended to silence wheat genes to change its carbohydrate content, can match human genes and potentially silence them. Heinemann’s research revealed over 770 pages of potential matches between two genes in the GE wheat and the human genome. Over a dozen matches were “extensive and identical and sufficient to cause silencing in experimental systems,” he said.

Experts warned that eating this GE wheat could lead to significant changes in the way glucose and carbohydrates are stored in the human body, which could be potentially deadly for children and lead to serious illness in adults. Yet despite the seriousness of these findings, regulators are ignoring and dismissing such warnings. According to the Institute of Science in Society,10 the Food Standards Australia New Zealand (FSANZ) has approved at least five such GE food products already.

Rather than using in vitro DNA modification (which is how Roundup Ready and Bt crops are created), this new breed of genetically engineered crops use a wholly different approach. In vitro DNA modification results in the creation of a new protein, but this new breed is designed to change their RNA content, thereby regulating gene expression within the plant. RNA is one of three major macromolecules, like DNA. Double-stranded RNA (dsRNA) is responsible for regulating more than one-third of human genes. By engineering the plant to produce dsRNA, the plant can be “instructed” to silence specific genes—within itself, and potentially within your body…

A Global Experiment Based on Faulty Assumptions is Bound to Take its Toll…

It is assumed that both DNA and RNA are broken down in your gut when you consume them in GE food, which is why they both have GRAS status (Generally Regarded as Safe). However, experiments dating back to the early 1990’s have contradicted this assumption.11 According to Dr. Mae Wan-Ho12 (for references, see the original article):

“There have been many publications documenting the ability of DNA to survive digestion in the gut and to pass into the bloodstream whenever investigations were carried out with sufficiently sensitive detection methods. DsRNA in particular, is much more stable than single stranded RNA. DsRNA produced in genetically modified plants survive intact after passing through the gut of insects and worms feeding on the plants.

Also, oral exposure of insect pests to dsRNA was effective in inducing RNA interference. Worms can even absorb dsRNA suspended in liquid through their skin, and when taken in, the dsRNA can circulate throughout the body and alter gene expression in the animal. In some cases the dsRNA taken up is further multiplied or induces a secondary reaction resulting in more and different secondary dsRNA with unpredictable targets. Thus, not only are dsRNA mechanisms universal to all plants and animals, there is already experimental evidence that they can act across kingdoms.”

Dr. Mae Wan-Ho also points out research from China, which has demonstrated that dsRNAs can survive digestion and be taken up via the gastrointestinal tract, and that microRNA (miRNA) from food can circulate in the human blood stream and have the potential to turn off human genes.

“The data also indicated that some dsRNAs from plants are found more frequently than predicted from their level of expression in plants; in other words, there may be a selective retention or uptake of some miRNA molecules,” she writes.

Most Consumers Still Unaware of GMO Risks

The biotech industry, led by Monsanto, is increasing their propaganda efforts to reshape their public image, and sway your opinion against the need to label genetically engineered foods. As The Atlantic recently reported.13

“Given its opposition to the labeling of GM foods… it seems clear that Monsanto wants you to close your eyes, open your mouth, and swallow.”

Indeed, many consumers are still in the dark about the very real risks that GE crops pose, both to the environment and human health. This is precisely what the biotech industry wants, even as increasing research demonstrates the many dangers associated with GE foods. For example, one recent study found that rats fed a type of genetically engineered corn that is prevalent in the US food supply for two years developed massive mammary tumors, kidney and liver damage, and other serious health problems. This was at dietary amounts of about 10 percent. Does 10 percent or more of your diet consist of genetically engineered ingredients? If processed foods form the basis of your diet, then you’re likely consuming FAR MORE genetically modified organisms (GMOs) than that…

Unfortunately, you can’t know for sure how many items in your fridge and pantry might contain GMO since the US does not require genetically engineered foods to be labeled. With the emergence of “gene silencing” crops and the latest findings from Samsel and Seneff, the need for labeling couldn’t possibly be greater.

AAPL: New Products and Innovation.

By: Mike the PhD.


One of Apple’s (AAPL) latest patent filings isn’t for a new laptop, cell phone, or tablet. It’s not even for a new kind of TV. Instead, Apple seems to be exploring diving into the computer accessories market with an iPen. This new iPen combined with the recent talk in the press over the last few months about a new iWatch suggest that Apple may be looking to shift its strategy surrounding major products going forward.

Historically, Apple has tended to make major products that represent a significant purchase for an individual. The uniformity across products allowed individuals to link these products together, but creating an ecosystem for each product was by and large left to third parties (think about the App stores, or most of the software for MacBooks, or even most of the accessories available for iPods). For example, Apple produces the accessories that are essential for a given gadget (e.g. chargers), the company does not sell iPod alarm clocks or iPhone cases. This has long been a point of pride for the firm as Tim Cook discussed in an interview with Bloomberg Businessweek last year. However, all of this may be changing if the firm’s new patent filings are any indication.

A smart watch is an idea that has been tried many times before with little success. In the 1970s, Casio made calculator watches, in the 1980s Seiko made mini-keyboard watches, and Microsoft made web enabled watches a decade ago. In each case, the smart watch proved to be a dumb idea for the company involved. Few people bought these products, which have been widely regarded as geeky novelties. Even the most persistent of smart watchmakers to date has had little success – Sony still sells a line of smart watches for $129 apiece. These can be used for emailing, tweeting, or playing music, but they apparently can’t be used by Sony (SNE) to make much money as they are rarely discussed by the company.

According to an engineer friend of mine at Apple though, the company strongly believes it can do better. Apple has a team of a little over 100 people working on a smart watch, which it plans to introduce in the fall of this year. The watch will serve as an iPhone accessory and the company hopes it will help to shore up iPhone sales for the next generation or two.

The iWatch is to be a device similar to the wildly popular Pebble smart-watch, which interfaces wirelessly with a smartphone for messages (i.e. emails, texts, incoming calls, etc.). The iWatch should be able to do at least this, and more. In fact, it is possible the iWatch could become a popular real-life version of the classic Dick Tracy Video Communicator Watch. My contact tells me that the iWatch should actually be able to be used to make and receive phone calls directly, check map coordinates, monitor vitals like heart rate, and keep track of daily exercise. In fact, it is possible the iWatch may not even need a battery since Apple has filed a patent for a “flexible wrist worn device” that is “powered by kinetic energy” – aka walking and moving your arms.

Gross margins on an iWatch could range from 50-60% according to some experts, and if the product gains wide acceptance, Apple might be able to sell 50 million+ units in the first 6-8 months. According to Citi Bank analysts, the iWatch could be a $6 billion product for Apple based on a watch price of roughly $125 (Apple Bill of Material cost of ~$50-60).

Further, Apple appears to be following Detroit’s lead in that the company now makes considerable amounts of money on selling parts and repair services for its products. A MarketWatch article recently discussed the mammoth costs of repairing a broken iPhone screen explaining that new iPhone 5 screen replacements cost upwards of $200 each. Virtually all of the screen repairs are currently done by Apple because of the company’s control over its parts supply chain. In total, iPhone repairs have cost customers more than $6 billion since 2007, according SquareTrade. Future accessories like the iWatch add complexity to the Apple eco-system and should enable the company to increase its revenues from repair bills as customers have ever more devices that need to be replaced or repaired.

But wait you might say, ‘The iWatch is just one data point… it certainly might mean the start of a new product strategy at Apple, but it could just as easily be a one-off idea the firm has that looks to be worth exploring.’ And all of that is true, except that Apple seems to be exploring another similarly significant accessory… the “iPen.” While the iPen is a much newer concept, rumors have been circulating for months about a smart iWatch with varying views on the usefulness of the product.

Most recently, Apple took out a patent on an iPen. Apple filed for patents on the first iPen designs several years ago, but never introduced the product, perhaps because it was more interested in making sure the newest iPhone and the iPad were launched without a hitch, or perhaps because Steve Jobs didn’t see the potential (UK’s Daily Telegraph quoted him as being disparaging towards tablet styli in 2007 ). However, the idea seems to be making new headway at Apple as the firm filed a new patent on an updated device at the end of 2012. Adding credence to the possibility that the iPen is on its way, Apple filed for the patent under the names of two of its engineers, a technique the firm has often used in the past for devices that actually do make it to market. Given that no other popular tablets on the market use a similar stylus, it is highly unlikely that Apple is using this patent filing as a defensive mechanism for the iPad, which likely means the company is at least evaluating the market for the iPen.

Based on the patent filings, the iPen seems to be intended as a smart device that will not write just like a regular pen rather than only on a tablet. The firm’s patent described the pen as “A portable computer arranged to rest comfortably in the hand has a small display screen. Accelerometers capable of detecting movement of the pen with respect to gravity provide input to a microcontroller, which selects a response from a number of viewing modes. The pen may be held in either hand and the output message to the screen will be oriented according to the location of the pen. Full personal digital assistance functionality may be incorporated in a relatively small plastics casing and functions, such as calendar, contracts the like may be incorporated.” Now patent filings are intended by companies to be opaque, yet just clear enough to get the patent, so exactly what Apple’s plans are is still unclear. However, one possibility I think is that Apple is angling to create a pen that will enable a user to write down notes on standard paper (in a meeting, or a class, etc), and then easily transfer those notes to an electronic form without needing to scan or retype the notes. The pen might also be equipped with some sort of software to allow it to record speech and then put the speech into an electronic form later.

Presumably, the electronic device working with the pen would need to be a Mac or an iPad. Therein lies the interesting point I think – for the first time, Apple may be getting ready to release a product that is not particularly useful as a standalone product. An iPen without an iPad or a Mac would be just a pen (with perhaps some ability to receive electronic messages or some other minor features). Now it’s possible that Apple intends to bundle the iPen with the iPad, or that the iPen would be sold on its own. Either way, the device would be much more costly than other accessories like ear buds or a spare charger. As such, if Apple is expanding into the accessories market with high value add-ons like the iPen that would instantly make the firm’s products even more profitable, and frankly it would also give customers an increased incentive to upgrade their old devices.

Regardless of one’s views on the likelihood of success for either an Apple smart watch or a smart pen, Apple has a history of being able to make controversial products a success where others before have not (e.g. the iPad vs. virtually all past tablets). As a result, the products clearly do have some possibility of being big hits for Apple.

What I think is more important though, is that taken together these two products suggest that Apple may be starting to look at how it can develop families of products around its mainstay devices like the iPad and the iPhone. By creating optional add-on products that could significantly increase the “package” price for a device, Apple may be able to begin making its products even more profitable, and potentially give users a reason to upgrade their older devices. In much the same way that Ford started out making cars “in any color as long as it is black,” Apple started out making devices that you could buy any way you wanted as long as it was Apple’s way. Today of course Ford offers a multitude of color and design options with numerous add-ons that make each vehicle sold tremendously more profitable. If Apple’s latest products are any indication, the company may be getting ready to take a page out of the automakers’ book. (For a more extended discussion of the implications of this possible change for Apple’s profitability, see my blog here.)

AAPL: Has it made a double bottom? May 18th–2013.

Here’s someone who has been against AAPL over the past 90 days, but now feels it has hit a double bottom and will start to rise.
Anyone who has read my blog knows that I  have been a huge bear on Apple Inc. because I knew that many of the biggest mutual fundsand hedge funds were dumping this stock over the last 3 months.

Yet I never mentioned the fundamentals of Apple which everyone already knows has how they have the best balance sheet in the world, a great dividend that’s higher than the 10 year treasury and growing, and now a perfect technical trading setup on the chart.

See I am an opportunist. I might have hated Apple over the last 3 months, but that does not mean I am not always looking at the stock every week to see if there are any signs of a bullish reversal.

Apple is starting to form an incredibly bullish pattern called an Inverse Head and Shoulders Pattern. Almost everyone knows what a Head and Shoulders Pattern is. It is probably the most common technical analysis pattern in trading. An Inverse Head and Shoulders pattern is an extremely bullish reversal pattern, it occurs when a stock forms a bottom by printing a series of 3 lows. Whats important about this pattern is volume. Volume must be heavy on the lowest low, because that signals a wash out- and exhaustion in selling, where are the sellers have sold their position and this is exactly what has occurred in Apple’s stock.

Just look at the Chart below:

appl chart

The second reason I think Apple has bottomed is that there is a catalyst which will propel this stock back up to  the $545 area, which would be a 25% move from Apple’s current share price of $433.

Here is the catalyst, Tim Cook the CEO of Apple, for the first time has come out and lobbied for Apple verbally in the public domain. This is a sign of leadership major hedge funds have been waiting for. Mr. Cook is going to congress to try and work with the US Government on repatriating the billions of dollars that Apple has overseas back into the US at a lower tax rate. I think the US Government will work with Apple and Mr. Cook on this. Why? Mr. Cook has said Apple is a huge taxpayer already and a huge employer of US Citizens, so they have a lot of power to negotiate and therefore I believe Apple and the US government will cut a deal on this offshore money.

Why is this bullish for the stock? The cash issue hurt the stock as market players: hedge funds, mutual funds etc hate uncertainty.  These big  funds like to bet on sure things, and the reason they have not been buying Apple recently is the uncertainty over Apple’s offshore cash hoard. Now that this issue is coming to the forefront with Tim Cook going to congress to discuss this, the cloud of uncertainty will start to disappear. When you combine that catalyst with the bullish Inverse Head and Shoulders Chart Pattern, it means Apple has bottomed. Let me repeat that I am calling a major bottom in Apple today.