How A Hangover Works

“What actually causes hangovers? If alcohol is metabolized after a few hours, why do I still feel crummy the next day?”

Alcohol Affect Body

If the data is any indication, at least 75 percent of youwill recognize this feeling: a throbbing headache, exhaustion, queasiness and even muscle fatigue following a night of overindulging. But what is it about drinking alcohol that causes such discomfort?

The cause is a combination of factors, but primarily one: dehydration.

“Alcohol is a diuretic, so you end up losing water. And the dehydration effect is probably the most severe contributor to hangover,” says Dr. Gary Murray, the program director for the Division of Metabolism and Health Effects of the National Institute on Alcohol Abuse and Alcoholism.

The more you drink and the higher the concentration of alcohol in the drinks you choose, the more dehydrated you’re going to be. According to an overview of the research, that’s because alcohol suppresses the release of the hormone vasopressin, which normally repurposes water released by the kidneys back into the body. With the absence of vasopressin, that water is marked for the bladder and eliminated. Alcohol also causes inflammation of the stomach lining, which can cause diarrhea — another dehydrating condition.

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How Draghi Opened The Door To Hyperinflation And Denied The Fed An Exit Strategy

We finally heard the intentions of Mr. Draghi, President of the European Central Bank (“ECB”). We only need to know the conditions Germany’s Verfassungsgericht will impose on September 12th. We believe they will be relevant.

On Thursday, Draghi told us he intends (1) to purchase sovereign debt in the secondary market, (2) that before he does so, the issuing country must submit to certain conditions within a fiscal adjustment program, (3) that when he finally buys the debt, he will buy any debt (new or outstanding) with a maturity lower than three years, (4) that after buying it, he will sterilize the transaction, (5) that the collateral pledged so far for liquidity lines will not be subject to minimum credit ratings any longer, (6) that the ECB will accept to rank pari-passu with other creditors going forward, and (7) that the Securities Market Programme will be terminated, with the purchased debt held until maturity. According to Mr. Draghi (but not toGermany), buying debt with a tenor lower than three years does not constitute government financing. The number three, it seems, is a magical number.

We will mince no words: Mr. Draghi has opened the door to hyperinflation. There will probably not be hyperinflation because Germany would leave the Euro zone first, but the door is open and we will explain why. To avoid this outcome, assuming that in this context the Eurozone will continue to show fiscal deficits, we will also show that it is critical that the Fed does not raise interest rates. This can only be extremely bullish of precious metals and commodities in the long run. In the short-run, we will have to face the usual manipulations in the precious metals markets and everyone will seek to front run the European Central Bank, playing the sovereign yield curve and being long banks’ stocks. If in the short-run, the ECB is the lender of last resort, in the long run, it may become the borrower of first resort!

The policy of the ECB resembles that which the central bank of Argentinaadopted in April of 1977, which included sterilization via issuance of debt. This policy would result in the first episode of high inflation eight years later, in 1985 and generalized hyperinflation in 1989. Indeed, Argentina’s hyperinflation was not caused by the primary fiscal deficit of the government, but by the quasi-fiscal deficit suffered by its central bank. We will not elaborate on a comparison today, but will simply show how the Euro zone can end up in the same situation. To those interested in Argentina as a case study, we recommend this link (refer section II.2 “Cuasifiscal Expenditures”, page 13 of the document)