Curve Ball Of A Volcano

Jim Reid, the strategist at Deutsche Bank, writes today:

If you can ignore Sovereign and regulatory risk then these really are the best of times. This week will likely show the extremes of these push/pull factors as strong earnings and data will be likely be offset by renewed financial regulatory concern and the EU Sovereign crisis perhaps coming closer to a head. In addition to all this there is now the added curve ball of a volcano, the impact of which is surely starting to become a macro event, especially if further eruptions follow.

Who cares about further eruptions?

Well, for the historic background, The Journal Of Nutrition on its website writes:

... On the one hand, harvests were low in many parts of Europe. From 1813 through 1815 harvests were generally lower than expected in many countries, largely because of a strong El Niño "warm event" which caused droughts in some regions and floods in others... However, 1816 was truly calamitous for most of the continent—a year "without summer" in most high latitude temperate zones as a result of volcanic dust blanketing high altitudes after a major volcanic eruption in 1815 in Indonesia ...

Then you travel to the website of Icelandic Met Office, and look at Q&A on the eruption in Eyjafjallajökull:

How long will the eruption last?
The eruption continues. It is not possible to predict the duration of the eruption. Previous known eruptions from this volcano were in the years 1612, believed to have lasted only three days, and 1821-3, when it erupted on and off for over a
year.

What kind of an eruption is it?
The eruption is an explosive eruption beneath a glacier. The ash is fluorine rich, of intermediate content and the particles are very fine.

Is the ash dangerous?
Yes, the fluorine is dangerous to livestock. The quantity is approximately 25-35 mg/kg according to chemical analysis carried out by the Institute of Earth Sciences, University of Iceland. The fine ash can also effect human health, for example the respiratory system.

Put it all together, and using the words of Jim Reid, one should:

Expect analysts to start to come out with pieces on the impact of this increasingly disruptive eruption.

Yes, and it spreads, as Volcanic Ash Drifts Toward North America ...