The New Economy

summers

No Dollar Left Behind
We all know that Janet Yellen will be the next Chairperson of the Fed. Larry Summers was Obama’s original pick for the position but he brings too much baggage to the table. Maybe because he would fall asleep in the President’s cabinet meetings (above photo) or maybe, as President of Harvard, he stated that the underrepresentation of female scientists at top universities may be in part due to natural differences between men and women. Who knows. Anyway, Yellen will be promoting “Sleepy” Summers ideas.

Last week at the IMF meeting in Washington, Summers said the Federal Reserve, by keeping interest rates at zero, simply isn’t doing enough to stimulate the economy, so the next step should be to apply “negative interest rates” on all savings accounts. Larry’s talking 2 to 3 percent adjusted for inflation.

In other words, everyone with a savings account, pension fund or IRA will pay interest to the banks for the privilege of allowing them use our money! But wait, it gets better. To make sure we don’t simply take our money out of the banks and hide it under the mattress, Summers wants to eliminate physical money and create a cashless society. That way the Fed will be able to skim take their cut off the top before you have a chance to see it. No saving allowed.

Saving is now considered hoarding and the only way to stimulate the economy is for everyone to spend everything they earn. Savers have to share the wealth. Welcome to Marxism. More at The Daily Reckoning.

In the meantime enjoy a blast from the past.
Creedence Clearwater Revival – Bad Moon Rising:

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Road Trip

Green Fuel or Snake Oil?
In 2009, environmentalist and film maker, Josh Tickell decided to make a film to promote the latest and greatest idea – algae fuel.  It didn’t matter that the cost to take algae from the pond to the gas tank would be prohibitive at this stage of development. This guy just wanted to make a feel-good, look how wonderfully green I am movie. Who wouldn’t want a car that runs on algae?

Under the stimulus bill in 2009, billions of dollars in federal grants were given to a few of the world’s biggest oil and chemical conglomerates to develop alternative fuels. So far, we don’t have a cost-effective algae product that is close to coming on the market.

But that didn’t bother Mr. Tickell. He decided he would create the world’s first plug-in-hybrid vehicle that could get 150 mpg by using algae.

First, he bought a plug-in hybrid Prius. No modifications to the gas engine were needed. Then he took 95% premium gasoline and mixed it with 5% algae to run the gasoline engine for the car. What you have is a plain old hybrid that runs off plug-in power and gasoline.

So what would a gallon of actual biofuel from algae cost right now? About $32.81 a gallon, according to Bryan Wilson, co-founder of Solix, an algae biofuel startup.

The only way to make algae fuel affordable is to reduce production costs. A bi-product of the fuel is animal feedstock. Profits from selling feedstock could be put toward to oil production. Two thirds or more of the body weight of wild algae is proteins and carbohydrates – not oil. Algae that is genetically modified produces a higher percentage of oil but it takes longer to grow, so it would be a trade-off.

Anyway, in Feb. 2009 Solazyme said it would be capable of producing competitively priced fuel from algae in 24 to 36 months. Well, that was 36 months ago. If the company was close to bringing a product to market there would be lots of buying activity for the publicly traded company. I checked the price of their stock today and found in the past 7 months the price of their stock has dropped from $27 to $12.52. Guess they are crying a green river.

Enjoy John Fogerty – Green River: