Comments on: Green Energy: The Largest Speculative Bubble We’ve Ever Seen

By: wind energy home

wind energy home — Mon, 18 Oct 2010 14:22:33 +0000

I think we should all look to harness wind power – don't you?

By: Frank the salesforecaster

Frank the salesforecaster — Tue, 10 Aug 2010 20:12:01 +0000

So I come upon this link a year later and the 10 year cmt is up over 20% year to date. Great call on that treas bubble.

By: why invest

why invest — Sat, 18 Jul 2009 15:07:05 +0000

Excellent article and very good, solid advice. Many people who talk about ‘green’ says that it will earn them their first million and that too soon. After going through the articles I think I will think about it twice before jumping into the wagon. Why investing is so tough always! why invest

By: charlie

charlie — Sat, 04 Apr 2009 13:32:23 +0000

Where is this place that gets 185 bushels of corn per acre? I grew up on a farm and there we were lucky if we got 35-40 bushels per acre.I also went on the custom harvest run from Texas to Cananda then back to Kansas for 5 years and I never harvested a corn crop of 185 bushels per acre.

By: mr_azri

mr_azri — Thu, 26 Mar 2009 05:57:25 +0000

You are the best writter

By: Larry DeVries

Larry DeVries — Sat, 07 Mar 2009 23:57:19 +0000

In reply to the figures given in regards to gallons of ethanol produced per acre, I believe the gentleman needs to recheck his sources of information. In our part of the USA the average corn yield is 185 bushel per acre, and the ethanol produced from a bushel is 2.9 gallon. So, in my figures that amounts to 536.5 gal. per acre of ethanol.
Kind of makes me wonder about some of his other statements also.

By: Tate

Tate — Wed, 04 Mar 2009 21:56:42 +0000

It’s an attention grabbing article no question, but would have been a bit more timely about a year ago! True, alternative energies such as wind and solar don’t compete well in an environment of $40 oil without subsidies, but do you really believe that oil remains at these levels? There’s your pipe dream. This isn’t the Jimmy Carter era.. China, India, Brazil and a host of other economies are now big time consumers and that will not change. Ethanol was ALWAYS a bad idea but wind and solar are here to stay. Sure, many of these companies will go under as the industry undergoes consolidation, but for the few players who emerge as leaders such as First Solar, Vestas.. the profit potential will be enormous. The bubble in green energy has come and gone and now it’s time for a round of survival of the fittest.

By: Alexander Wissel

Alexander Wissel — Wed, 04 Mar 2009 15:27:38 +0000

With all due respect, Lou takes his lumps when deserved. But the facts don’t line up with your recollection…

His subs booked a 266% gain on his long dollar recommendation (put options on FXE), a 19% gain on his short oil call (via DUG). And 18% and counting on his short Treasuries call (via TBT).
As for his latest prediction to short gold – prices are trending in his favor too. Gold stands at $913.50 this morning compared to $938 the day he recommended the move.

So doing “the opposite of what he said every time” clearly would not be profitable.

By: rca

rca — Wed, 04 Mar 2009 06:01:05 +0000

Louis Basenese – you say “In the end, the economics just don’t add up.” If that is true, how do you explain Warren Buffet’s annual letter to his shareholders from Saturday? It talks about two utilities owned by BRK:

“Since our purchase, MidAmerican’s
wind-based facilities have grown from zero to almost 20% of total capacity.
Similarly, when we purchased PacifiCorp in 2006, we moved aggressively to expand wind generation.
Wind capacity was then 33 megawatts. It’s now 794, with more coming. [... We] have been allowed to earn a fair return on the huge sums we have invested. It’s a great partnership
for all concerned.”

Don’t get me wrong – I agree there is a green bubble. But in some cases, it makes sense from an economic and especially a national security standpoint. Warren Buffet seems to think so too.

By: rca

rca — Wed, 04 Mar 2009 03:56:45 +0000

Everybody knows that in the long run, green is the most economical. But the up front capital cost for most green installations is a major barrier.

One solution, requiring no government subsidies, is to pay for these installations with property tax liens. Spend $25,000 on solar panels for your home, say, or $10,000 on insulation, and pay that off with your annual property taxes over 20 years, say.

Unlike a lot of government programs, there are real incentives to keep the cost down. The customer still wants to save money on the installation – after all, she still has to pay taxes on it. The installer wants to reduce costs – after all, she wants more customers. The government doesn’t get any extra taxes – they only have to collect what they paid the installer.

Who wins? The homeowner has a lower electric bill. The power company can postpone building power plants at today’s historically expensive construction costs. The country wins with a) increased energy efficiency, and b) reduced dependency on foreign energy. The world wins through reduced global warming and increased economic efficiency.

Think it can’t be done? Well, Berkeley, California is doing it, and lots of cities around the world are watching. If the installers were public, I would be buying stock in them now. This idea is way better than T. Boone Picken’s supposedly green natural gas boondoggle.

There are other obvious winners too. Build well insulated new homes. Paint your roof white to keep your air conditioning costs down. Why pay $20,000 for a gas guzzler car when you can pay $20,000 for a gas sipper?

Louis Basenese is right about the bubble. But wrong that none of the green solutions make sense economically.

Finally, our dependence on foreign oil is a major problem. “Drill, baby, drill” is no solution at all. The sooner we start using greener replacements, the more secure our country will be.