Will Fire-fighters be Affected by The Global Financial Crisis?

I have to agree, it does sound a bit weird....lumping all of these words together into the same sentence.....

After all - whatever could possibly connect wildfires, fire-fighters and the Global Financial Crisis [GFC] together?

No doubt, we are all in agreement, these are LIFE-CHANGING DISASTERS - but, could there be other, unseen factors linking these catastrophes?

After massive falls in Global Stock Markets - could the US Dollar become a casualty too?

Despite the gloom of March 2009, a recovery continues in World Equity Markets. Now, in early 2010, much of the fear in the markets appears to have abated.

But, some analysts still forecast that there is more damage looming, just over the horizon.

And - we still don't have all the answers - could stock-market shocks possibly have any affect on funding for fire-fighting operations?

Because, we still need money for equipment, wages and supplies for our fire-fighting services - don't we?

So, if there could be any effects - perhaps we should identify and prioritise them - after all - knowledge is power - and....

Forewarned is Forearmed.

And....if the economy does take longer to recover, then it is still a good idea to be more self-reliant - because Governments may still be focussed on other programs.

So...we need to become more self-reliant.

This means that self-help is the start of the wildfire risk-assessment process;

1. Conduct a wildfire threat assessment of your own home & property - seek help from professionals - such as your local Fire Authorities - they are your best resource!

2. Identify each risk that applies in your specific situation - discuss any queries or doubtful points with your own fire authorities before you design your own fire-plan.

3. Write-down a list of priorities that could affect your family in the event of wildfire. For example, what will you do with your elderly relatives, pets, or farm animals?

4. Do you have a 'Stay or Go' Policy -- work on a plan that safely addresses all of the risk criteria - discuss your plan with your family and your local fire-brigade members - remember - they are there to help you.

5. Brainstorm your plan - test & rehearse the plan.

6. After rehearsals - itemise what worked and what needs improvement.

7. Then make necessary changes to improve the plan - focus on life-saving outcomes.

8. Ensure that families, friends and neighbours are aware of this plan.

9. Discuss your plan with your local Fire Authority - they may require a copy. Remember - whenever in doubt, your local fire-fighters are the 'go-to guys' - they will be happy to help and advise you on your best options.

10. And when all of this is done -- you now have your very own Individual Fire Plan - and this is vital - it must be designed to save the lives of you and your loved ones.

Congratulations - your fire-plan preparations are now complete - and you are ready to act - just in-case a wildfire threat develops.

Remember -- for those of us living in wildfire-prone areas, a Fire Plan is essential.!

If ever a wildfire threat is imminent, actioning our own Fire Plan is the safest way for us to survive - this includes our families, friends, and our neighbours too.

Could Our Fire-fighting Capability be Affected by the Global Financial Crisis?

It has been well over a year since the first shockwaves of mortgage defaults, market corrections and Bank failures, reverberated around the world.

When Lehman Brothers collapsed, people suddenly became aware of the fragile nature of an unravelling economy, just as our forebears did in the 1930s.

After-shocks continue to this day - creating life-changing events for people all over the globe, and not just for those living in the Developed Economies.

Research about the GFC, including personal testaments and books, have already been published - and they are widely available.

As an example - in their account of the Lehman Brothers collapse, authors Lawrence G. McDonald and Patrick Robinson, detail events that continue to steam-roll through our global markets - long after the collapse - even to this day.


And - moving forward - what about now - are we through the worst of it all yet?

Some newspapers report that we are already through the worst of the Global Financial Crisis.

In an article by Peter Martin, for the Australian newspaper, The Age in the June 9th, 2009 edition...

"The Bank for International Settlements was one of the only institutions to accurately predict the global financial crisis. It has issued statements to say that the worst has probably passed, as confirmed in this release....

"The Swiss-based bank says "glimmers of hope" are sparking a "rebound of risk appetite among investors", pushing up borrowing by more than a quarter so far this year."

"The key economic indicators remain at depressed levels," the bank says in its latest quarterly report. "But investors are focused instead on incipient signs that economic conditions are deteriorating less rapidly than before, while intensified policy actions to counter the crisis have helped bolster confidence."

Peter Martin's article concludes with...

"The Bank for International Settlements distinguished itself from the International Monetary Fund, the World Bank and the Organisation for Economic Co-operation and Development by pointing to the dangers of a global financial crisis in 2007."

In its quarterly report, economic data is turning out to be less gloomy than expected, particularly in the United States."

Below is a graph from the US Federal Deposit Insurance Corporation [FDIC] showing US bank failures since 1970.

Bank failures during the Savings & Loans Crisis - in comparison with the GFC.

This triggers the burning question - do we have blue skies ahead?

Not according to William Black, who is Associate Professor, Economics and Law, University of Missouri, Kansas City.

Prof. Black stated in an interview with The Wall Street Journal, Digital Network, that...

"Mopping up the savings-and-loan crisis cost $150 billion; this current crisis will probably cost a multiple of that. The scale of fraud is immense. This whole bank scandal makes Teapot Dome [of the 1920s] look like some kid's doll set."

As financial author and journalist Danny Schechter, recently reported...

"Initially, this was seen as simply a financial problem but it quickly became a social crisis too.

States and cities began cutting back essential services as their tax bases contracted."

Danny Schechter raises serious questions.

What will happen if the GFC continues into, or even beyond, the next fire-season?

As the Northern Hemisphere wildfire-season finishes, agencies have already reported critical funding issues that are a direct result of the GFC.

In one such case, the Surrey Fire Association in British Columbia, Canada, provides details about these detrimental effects, and, how it has compromised their ability to fight fires. All because of the on-going Financial Crisis.....

"The economy is affecting IAFF members throughout this union through staffing reductions, station closures, cost shifting and wage concessions as local governments lose revenue."

"To help IAFF members get a clearer understanding of the depth of the financial crisis, the effect it’s having at every level of the economy — including local and state budgets — the IAFF has prepared the following summaries of and links to “economic crisis” news articles related to cuts in state and local budgets, fire fighter staffing, health care benefits, compensation, pension plans and other areas as a result of the economic downturn."

Source: http://www.surreyfirefighters.com/site/news/national-fire-fighter-news/

Funding our Fire Fighting Operations is critical - how can communities get help and protection with cash-strapped Fire Services?

Then there is the issue of complacency.

Some may say...."well, that won't be such a big problem, because next year this Crisis will be over.

Then here will be plenty of time & money to prepare for the next wildfire season!"

Specialised vehicles and training cost money - Fire-fighters prepare in a forward area - Photo courtesy of Jade Elliott - Scouts Australia.

Without adequate funds, Fire-fighting Services will be unable to pay for;

** Operational costs - fuel & maintenance,

** Replacement parts - loss & damage of equipment,

** Workcover & Insurance - staff, volunteers & equipment,

** Wages and contracts

** Capital expenditure - new vehicles & equipment

As the Northern Hemisphere begins its Autumn, residents are naturally focussed on keeping themselves warm until after the Winter.

But, will they be thinking and preparing themselves for next Summer - fire-season weather?

This brings to mind an old proverb...

Dig the well -- before you are thirsty.!

For those of us living south of the Equator, it is already too late to begin large-scale fire-proofing projects, such as creating fire-breaks across extensive forests or farmlands.

According to Credit Suisse, there are 5 more sectors on track to default - they will be much larger than the sub-Prime Mortgage sector, and collectively add up to trillions! - Graph courtesy of T2 Partners LLC.

As for the future - does the above image indicate more trouble ahead?
Could this be the start of much larger default waves?

On July 31, 2009, Elena Logutenkova reported comments from Deutsche Bank AG Chief Executive Officer, Josef Ackermann that ...

"Rising delinquencies among consumer and corporate borrowers are the “next wave” of the financial crisis and may affect banks that have avoided losses so far."

“This crisis has consisted of a series of earthquakes, with changing epicenters,” Ackermann said late yesterday at an event in Zurich.

“Bad loans are the next wave. Banks that have fared relatively well so far will also be affected by this.”

There is still an avalanche of mortgage debt to follow the sub-Prime writedowns - on top of an already shocked market. Graph courtesy of T2 Partners LLC.

By the end of 2012, it is expected that foreclosures will number around 5 million in the USA alone.

A classic train wreck - many ask - why did so few economists see this GFC train-wreck coming?

And, as Ross Gittins queries in his on-line article of the 12th Sept, 2009, for brisbane-times.com.au....

"So why did so few see the train wreck coming?

"Because they all believed in a theory that said train wrecks couldn't happen. To go against that theory took strength of intellect and moral courage few possessed."

"What brought the economists undone was the foundational assumption of their ''neo-classical'' model, that people always act ''rationally'' - that is, with well-informed, careful calculation - and the more recent elaboration of the neo-classical model as it applies to financial markets, the ''efficient-markets hypothesis''.

"This hypothesis holds that financial markets always accurately price financial assets (such as shares or bonds) given all the publicly available information. This implies that asset price bubbles can't exist and sudden crashes don't happen."

"It also implies that markets are perfectly self-correcting, that government interference in markets is unnecessary and probably damaging and, indeed, that the business cycle doesn't exist."

Source: http://www.brisbanetimes.com.au/business/why-economists-failed-to-predict-a-train-wreck-20090911-fkrd.html

Will Economists Achieve Redemption?

Understandably, many blame these economists, who preached the mantra of the 'frictionless' and 'seamless' connection between 'theoretical' and 'real-world' markets.

Yet, some of these same economists are now being tasked to guide us out this economic quagmire - can they fix the critical damage that has already been done!

Even as the above images of tsunami-sized defaults loom ahead of us - we are still reading statements in the media that business will soon 'normalise.'

Yet, there are still $trillions$ worth of 'paper', in the form of derivatives, bonds, collateralised debt instruments, etc. still circulating within the Financial system.

The following image illustrates the parlous state of the global economy, courtesy of this website;

Source: http://www.doorsofperception.com/

How the credit contraction doesn't simply collapse - it evaporates!
Based on an adaptation of Exter's Pyramid - Graphic, courtesy of RunToGold.com & CreditContraction.com

So, is global business increasing and returning to a normal routine?

How can we tell?

Perhaps a check on shipping movements, the global logistics chain, where....

...Ships travel to raw-material markets - load up the necessary 'stuff' from exporters, such as, the BRICCA economies - Brazil, Russia, India, China, Canada & Australia,.....,

..and in turn, carry the raw material to factories, for example, South-east Asia and China,

..where, in turn, they turn this 'stuff'into manufactures, or 'useful things', that people 'need' or 'desire',

..once again, ships load these 'useful things' and bring them to marketplaces - all over the world,

including those countries who provided the raw materila 'stuff' in the first place - the same BRICCA economies.

Meanwhile, converting the 'stuff' into 'useful things'requires skilled people, capital expenditure, and energy.

Energy, in the form of coal, LNG or oil, also requires ships, supplies and skilled workers to drive active economies.

So, an increases in manufacturing must be supported by similar increases in global transportation - signs would include busy Ports and Harbours, with bulk freight and container traffic on-forwarded via local distribution networks - barges, rail and road .

Which begs the question - What is happening within the World's International shipping lanes?

Aerial view of part of the Ghost Fleet - lying at anchor near Singapore - Photo courtesy of Richard Jones - Sinopix.

If Simon Parry's report in the Mail Online website, dated the 16th Sept., 2009, is any indication, then the outlook may be grim.....

"The biggest and most secretive gathering of ships in maritime history lies at anchor east of Singapore."

"Never before photographed, it is bigger than the U.S. and British navies combined but has no crew, no cargo and no destination - and is why your Christmas stocking may be on the light side this year."

Source: http://www.dailymail.co.uk/home/moslive/article-1212013/Revealed-The-ghost-fleet-recession-anchored-just-east-Singapore.html#ixzz0RoT8SmUy

Simon further reports that this armada is growing every day.

"The Aframax-class oil tanker is the camel of the world's high seas. By definition, it is smaller than 132,000 tons deadweight and with a breadth above 106ft."

"It is used in the basins of the Black Sea, the North Sea, the Caribbean Sea, the China Sea and the Mediterranean - or anywhere where non-OPEC exporting countries have harbours and canals too small to accommodate very large crude carriers."

"This time last year, an Aframax tanker capable of carrying 80,000 tons of cargo would cost £31,000 a day ($50,000). Now it is about £3,400 ($5,500)."

It is a long article and Simon Parry conveys much more than simple words in his description of the massive changes that are coming to a market near us. He further explains....

"This is why the chilliest financial winds anywhere in the City of London are to be found blowing through its 400-plus shipping brokers."

If the Global Financial Crisis teaches us anything - it may well be this,

When everybody is thinking the same....somebody is not thinking!

Source: General George S. Patton

There is no doubt that many people were unable to predict, or 'crystal-ball' what was highly unlikely to happen in the global financial markets.

Millions of people were relying on others to detect, anticipate, and plan for such an event.

For numerous reasons, this did not happen.

All we can do now is to learn from these lessons and apply this knowledge to the future.

Many financial gurus advise - the best method for Investing to get involved yourself, in other words,

Do Your Own Research!

This advice applies to residents living in at-risk wildfires areas.

Always analyse, assess and plan for your own particular circumstances.

As we apply Wealth protection to our finances, so too must we apply ourselves in life protection, rather than simply rely on Governments to save us.
The place to start is with our own Fire Plan.

In May, 2009, 11 fire-fighting vehicles were destroyed in a Training Fire-fighting facility in the UK - Photo courtesy Adam Gasson

By now, it is obvious that National Governments are struggling to cope with the huge economic pressures to find a way out of this disaster.

After all, when 'Quantative Easing Policies' run out of money, the inevitable drastic cuts will follow.

If Federal, State and Territory budgets are slashed - what will be the effect on Fire and Emergency Services within an already debt-ridden economy?

After-all, fighting fires is hazardous work. Operational deployments of fire-fighting equipment and vehicles always creates inevitable breakdowns.

Wildfires can also damage or destroy materiel.

And, accidents always happen when you least expect it.

As Luke Salkeld reported in an article for UK Mail Online, on the 18th May, 2009....

"Burned-out and blackened, this is the scene of destruction left by a massive blaze - at Britain's national fire service training college."

"Dozens of firefighters were called in to tackle the inferno, but the flames caused an estimated £1.3million of damage to 11 fire engines.

"Last night it was claimed that the vehicles could have been saved if sprinklers had been fitted in the building at the Fire Service College at Moreton-in-Marsh, Gloucestershire."

"One worker said: ' We are always told that large commercial buildings should have sprinklers but it seems the fire college did not practise what it preaches.'"

Source: http://www.dailymail.co.uk/news/article-1183709/Blaze-leaves-1-3m-trail-destruction--firemens-college-sprinklers.html#ixzz0RbXBlwS3

So far, we have looked at the wildfire issue from a Top -> Down perspective - Government providing communities with the specialised vehicles, equipment and personnel to combat fires.

However - as the Global Financial Crisis continues to create conflicting arguments among the Economic Gurus struggling to untangle the mess - don't lose hope.

This should not prevent anyone from developing their own, individual Fire Plans. Neighbours can also analyse, adjust and integrate their fire plans with other community members.

Wherever you live, whether in a town, village, farm, or cattle station, there are always simple precautions that you can take to help reduce your wildfire risks.

We will be outlining novel ideas that you may follow-up with your local Fire-Fighting Authority or Service.

They may already have recommendations in the form of Fire Plan Templates that are best suited for your area.

With the variability in global climate patterns, areas that were once rarely affected by fire are now facing a very different situation.

Recent experiences in Australia's devastating Black Saturday Bushfires of February, 2009 continue adding to the toll in lives lost, destroyed, injured and affected.

These wildfires claimed the lives of 173 people - as witnessed by those who survive - many still suffer, both physically and emotionally, in the aftermath.
The design, preparation and action of the Fire Plan can only be made by individuals based upon their specific situation.

It is vital to begin this process before the hot weather arrives.
There is not a moment to lose!