Thursday, December 20, 2007

Do not go Gently into that Zero-Sum Night

Something I'd read ages ago, updated here by the always-estimable Martin Wolf of the FT, and commented by Naked Capitalism.

If there is a crunch or three coming along (energy use, global cooling cos' of Chilling Stars, various tragedies of the commons), we humans won't react all that well. Fights. Wars. The line which best sums it all up:

"People fight to keep what they have more fiercely than to obtain what they do not have. This is the “endowment effect”.


Monday, December 17, 2007

The Food Channel strikes again

This little anecdote has to be one of this season's LOL hits....

How's about:

a huhu grub inside a
rifleman inside a
tui inside a
pigeon inside a
blue duck inside a
little bush moa inside a
New Zealand eagle

I'd just be exerting my customary/culinary/cultural rights.

Oh dear. Some of these here boids seem to have been extincificated.

Culinary rights clearly have a Lot to Answer For.

No, wait. Some of 'em went west during the Little Ice Age. So we'll blame a lack of Globble Warmening.

No, wait...

Thursday, November 29, 2007

Woo-Hoo. No Really. Solar panels at $USD0.30/watt

This is just the best news. Big award, for a deserving company.

With current solar at around$USD3-5/watt, buying say 2 or 3 kw of panels is economic madness, particularly when you do the conversion to the Kiwi Peso. Best price I've seen for silicon is around $NZD9/watt. Times that by, what the hell, 3000, and that's a lot of pesos.

No more.

Nanosolar (hmm, I seem to have figured this out early this year) is just, according to the money quote from the PopSci award linked above, "putting down factories instead of blathering to the press and doing endless experiments. These guys are getting on with it, and that is impressive."

And at say $NZD 50c/watt (once supply gets here, say 2009 - Nanosolar have a lot of pre-committed sales), why, that 2-3kw of solid generation you need, looks suddenly quite affordable. $NZD 1,500 for thin-film, versus $NZD 27,000 for silicon - well, I think dat's what dey call a no-brainer.

To be sure, there will be conversion efficiency differences, and other factors which will make the thin-film look less rosy. But there's a lot of wiggle room in that price diferential, to soak up these factors. Even if the thing ends up just being one-quarter of the silicon price, instead of well under one-tenth, the outlay is not too much of a stretch for households.

And that's the secret. really. Widespread adoption. Bring it on.

Monday, October 01, 2007

Abiotic Oil - Gaia's fruit after all?

This is the latest (and, to my mind, clearest) statement about the origin of Oil - it ain't a 'fossil' fuel at all, according to those contararian Ruskies. It's a natural product, created deep within the Earth and slow-erupted up into the crust. Where it can be found by following geological signs, but just not the ones the Western scientific world tends to use.

All this rather does blow a big hole in Peak Oil theories, and indeed in any theory which treats oil as a finite resource. According to the Asia Times article (and I guess, to the book behind it) by F. William Engdahl, the Russians have followed an abiotic-origin theory since Wegener's time - the 1930's. They find oil where Western geological wisdom says there shouldn't be any.

So cars, SUV's and other devil-spawn are going to have four energy sources in future:

1 - oil, the natural, Gaia-created product of the deep
2 - hydrogen - and note the recent breakthrough in making this directly from plant starch
3 - electricity - I'll have a Wrightspeed, please
4 - Liquid fuels with similar energy density to petrol, from biomass

Who says that science isn't fun? Or that it can't save us (yet again - remember that hysterical old ninny Paul Erlich, anyone? "The edge of the crisis - we describe our first encounters with the age of scarcity and outline the greatest threat in the immediate future: the food crunch" - chapter One heading from "The End of Affluence", 1974).

I'll take Science over State of Fear, any day.

Tuesday, September 25, 2007

Columbia to Ahmadinejad - you exhibit all the signs of a petty and cruel dictator.

At last, a univeristy type with a backbone. This is Columbia President Lee C. Bollinger's address to the hapless Iranian. Mr President, I'll second that.

Drugs - to ban or not - Lee Harris expostulates

This article is the best I have ever seen on the topic. It reviews Theodore Dalrymple's book 'Romancing Opiates: Pharmacological Lies and the Addiction Bureaucracy', and Richard DeGrandpre's alternative approach in 'The Cult of Pharmacology: How America Became the World’s Most Troubled Drug Culture'. Who says history is bunk, after reading Harris' skilful interlacing of the Greeks, John Stuart Mill, and the content of these two books? I must confess that Theodore Dalrymple (a pen name, real name Anthony Daniels) is a personal favourite, yet Harris gently steers away from some of TD's more uncompromising positions. A great article, by a great author.

Wednesday, July 11, 2007

Standard and Poor's Moment of Truth

The headline really says it all, no? And, dear reader, it's not from a lone blooger in his attic. It's from Dow Jones.

All of us who have wondered, for three years now, just how it is that credit can be freely given for crap furniture ("Buy now! No repayments until your 3-year-old kid graduates Medicine school!"), let alone actual Houses, are receiving an answer from the financial universe.

It's all Smoke and Mirrors. It is financial junk. And it is tanking. Sinking, Flushed, Round der Bend.

Already there is a domino effect in the US:

- Home Depot (fond memories: I bought two Bostitch nail guns there for amazing low prices, and despite some TSA headscratching, got them back to NZ in checked baggage) has announced an earnings downgrade

- Builder D R Horton has orders down 40% and inventory piling up. (Although just how new houses can 'pile up' does make one stop and think. Maybe they just stack them with big forklifts, like containers?)

- Re-rating of sub-prime debt instruments (the now infamous CDO's) is rampant, and guess what they will find - more junk and crap, everywhere they look. As Dr Housing Bubble notes, there's over a trillion US in mortgage re-sets a-comin round the bend.

So the question for NZ is - how soon before the US mortgage train wreck grows wings and flies the Pacific to land here? Oh wait, Bridgecorp was evidently into non-prime-mortgages too. As I seem to have voiced before, it would be schadenfreude if it weren't My country, too.

If I was working for one of the crop of recently opened appliance stores, I'd be polishing my CV. Because it's just amazing what you can do without when you put your mind to it. And vanity spending is the first to, er, vanish.

Boy, am I glad I downsized mid last year.

Update: 20 Jul 2007.

A good summary of the mechanisms behind CDO's and the other financial instruments which are presently in trouble. The obligatory quote:

'Bundling mortgages into asset-backed bonds and then agglutinating those bonds into collateralized debt obligations sliced into different flavors of risk always smacked of a sophisticated pyramid scheme.'

That's right folks - a pyramid scheme.....

Thursday, July 05, 2007

Climate Change runs out of gas

This piece of actual science shows the value of actually doing the sums. Essentially, there jest ain't enough recoverable hydrocarbons in the entire world, to support assumptions made in the IPCC's climate model. Like, IPCC assume 11-15 trillion barrel-of-oil-equivalent (TBoe) is going to go up in smoke.

Bzzt...wrong. There's only 2.7-3.5 TBoe left in the whole freakin' world, according to this. That's (counts on fingers) only 38% (3.5/11 - the best case) of the IPCC assumption.

It's really embarrassing, if you are of the Chicken Little persuasion, or (needless to say) a UN bureaucrat or activist scientist on the Gerbil Worming Gravy Train, to trip over such a basic misapprehension about our world.

But wait, there's more.....

And, of course, the real story is well away from the neg-heads, over here. Solar (particluarly thin-film solar) is going to power us in a generation or so.

Thursday, June 14, 2007

The Key to All Mythologies

This article (ht: Gods of the Copybook Headings) sums up my own attitude to The Gerbil Worming debate. A teaser quote:

"it speaks in the doom-laden accents of pure certitude of what will happen in 50 or 75 or a hundred years from now - and, with the same ferocious certitude, demands decisions of immense consequence be made now to forestall its bleak and definitive projections."

Right on, bro'.

Tuesday, May 29, 2007

So That's the problem

Here's a neat piss-take on the Scary (well, scarily bad) Science behind the Beeb's recent trip to the thinner atmospheres of unreason, re WiFi radiation in the home.

Sort of reminds you of all the other Chicken Little fads that we, as dumb humans, seem to need to work through every once in a while:

'A Blueprint for Survival' - I still have a yellowing copy (you'd think they'd have printed the damn thing on Sustainable Paper, no?). Hmm - Amazon have it for $USD78.71...Cash registers signs go up in the eyes. Well, after all, the Sunday Times did say 'nightmarishly convincing - after reading it nothing seems quite the same anymore'. Funny - I had that same reaction about 'America Alone'.

'The Population Bomb' - count the kids in Your household and tell me this one didn't seize hold. Pity they never told those Others...

'The Coming Ice Age' - a perennial favourite.

Why, there's a pattern there!

Thursday, May 24, 2007

Agriculture in NZ - the no-subsidies version

This international article is a good summary of the last 20 years' experience of unsubsidised farming in our fair land. The Social Laboratory Syndrome strikes again!

I do remember a leetle anecdote about those last glorious days of Supplementary Minimum Prices in the late '70's, way down South in a tiny self-governed town called Otautau.

Y'see, SMP's were counted on certain days. And the basis for Price Support (gawd, what a totalitarian title That was...) was per live stock unit. $/sheep: nice and simple. Oh, and some more for the wool.

Only problem was that 3 days before Count Day, a major (150 year return period - we had 3 of those in 18 months...) flood went down the Aparima, and a lot of the SMP'able stock drowned. Or so you would have thought, seeing them in fences, under willows, and in the middle of paddocks, on their backs with their legs in the air, bloated like Michael Moore.

But by strange circumstance, as far as the SMP count went, the very same stock units had held their breath underwater for 3 days, and survived just long enough to pass Go and collect their $200.

They breed 'em tough in Southland.

Whoever said economic incentives don't work?

Thursday, May 17, 2007

Housing Bubble

A useful post here from another bubbular location: Southern California (SoCal, for short).

What can happen there can happen here, too. The post is quite good on the accelerated effects of information flow about housing, and the relationship between credit card debt and higher mortgage payments as fixed-rate or sweetheart deals reset to mrket levels.

In the '80's, Muldoon borrowed and hoped. We have lived through what it took to get us out of that hole: the best part of 20 years of work and better productivity.

And now, two aspects of the zeitgeist are putting us back in a similar hole:

1 - a Gummint hell-bent on buying enough votes for the next election, via various income redistribution schemes. Personal Tax cuts? Nah, Nanny knows best, you lot will simply add demand to the economy if we let you actually keep your own money. Speak for yourself, Michael bloody Cullen: I would pay down what minor debt I may have, and put the rest into Aussie shares and another super fund.

H L Mencken had it right in the '20's: an election is 'an advanced auction of stolen goods'.

And we are about to find out the hard way, yet again, that you cannot redistribute yourself rich.

2 - There is undoubtedly a local housing bubble. When it corrects, from a point where house price to income levels are around 5-7 i.e. unsustainable, to a level of say 4, look out below. 4/5 is $100,000 on a $500,000 home: a $100K loss. But 4/7 is $300,000 on a $700,000 home, and there's plenty of those just along my own street. So if you are one of the Feckless Many who have ratcheted up their debt anywhere north of 75% of current house valuation, you're gonna be hurting soon.

In effect, in the '80's, Muldoon borrowed and hoped at a public-sector level.
But in the aughties, borrowing and hoping is a private-sector pursuit.

And as the poster points out, in an environment where news and sentiment get around at the speed of light, that 'when', as in when the correction happens, might be a lot sooner than you would like.

SoCal catches the flu, we all cough.

Lileks Local News

As anyone with a passing acquaintanceship with the blogosphere knows, James Lileks has been bumped off the Strib's columnist list, and assigned to local news stories.

But I would bet that the dopey exec's who handed out this demotion, aren't prepared for this sort of reporting of their hallowed local events....

Tuesday, April 24, 2007

Housing woes - oh, and they're in the UK

Dear old William Rees-Mogg has a typically pithy article in the Times. Change the context to NZ, and his comments are still apropos. Especially the ones about the four conditions for a cartel. From the article (my numbering added):

"1. license housebuilding, so that no one could build a new house without a licence, or even rebuild an old house or a redundant barn.
2. encourage developers to maintain large land banks in order to benefit from rising prices.
3. leak out new permissions only after long periods of delay.
4. combine this with an unlimited flow of mortgage credit and relatively low rates of interest.

If you restrict supply below the market clearing level and increase funding, you will inevitably create a bubble and you will lock people out of the market."

The wisdom of the old geezer: two of my go-back-to books by this guy are the rather apocalyptic "The Great Reckoning", published in 1992, which foresaw in rather exquisite detail the rise of terrorism among other things; and "The Sovereign Individual", published 1997, which foresaw the break-up of the world's larger and more unwieldy entities, and the privatisation of states, armies and other traditional nation-state apparatus, on smaller scales. Blackwater, anyone?

Prophetic stuff.

And wonderfully different to the asswipe smush (one square only, though) served up in the name of analysis in our own little deranged dominion.

Monday, April 23, 2007

We'll have to coin a new shorthand for this

Darwin is hard at work again, here.

Used to be 'Fish, Barrel, Shoot' as a shorthand for, well, shooting fish in a barrel.

Taunting a number of crocodiles then suffering the consequences (both kids and crocs) has that air of inevitability about it all, n'est ce pas?

So perhaps 'Croc, Taunt, Lunch, Shoot' is it......

Sunday, April 15, 2007

Solar independence

Th is is good news. There are several companies very active in the CIGS field now (Nanosolar, Miasole, Konarka, Heliovolt) and there is a very useful directory here.

The premise is simple: thin film solar generates DC current in useful amounts, and the films themselves are produced via a printing process akin to newspapaer printing. That is: by the hectare. The films can be molded in any shape, stuck to existing e.g. roofs, and costs are predicted to ba around $USD0.50/watt within 5 years.

So instead of building centralised power stations, this holds out the prospect of completely self-powered houses. Nice thought, huh?


Another good directory here. Once this stuff gets commercialised with distributors, franchisees, integrators and tradespeople on tap, it will be gangbusters. Or even, Dambusters. Just think of what evacuated-tube solar hot water is doing right now. The same, squared, will apply to residential solar. And the nicest aspect (no URL, found the info while wwilf'ing) is that the power is clean: no more spikes or ripples caused by neighbours welding, nearby industries, or incompetent power suppliers.

Tuesday, March 20, 2007

Those darned House Prices

This analysis (which, funnily enough, blames investors, and this rather better one, which blames the stoopid Gummint, are both about the same research, by Dominick Stephens, of Westpac. Apart from the headline bias, the reserach confirms my own view of the casuses of the growing house price-to-earnings ratio (currently sitting at the 'severely unaffordable' in major NZ cities: at or over 6).

The article nails changes in top personal tax rates, versus company rates, as a key driver. This was pure politics-of-envy stuff, back in 2000. Westpac's analysis thinks this alone accounts for 17% of observed house price increases since 2000.

I can think of five major contributors to increases, apart from this:

1 - the dopey Govt efforts to get first-home buyers into the market, by guaranteeing the first $100k of mortgage irrespective of the purchaser's ability to pay. This had the instant effect, right here in l'il ol' Christchurch, of making every house price start at $100K, practically overnight. Properties, just before this fabulously ill-considered action, could be had in the poorer 'burbs for under $50K. After that action, prices went rapidly north of $120K, for the very same house. So much for the poor buyer.

2 - the creeping effects of regulation in building itself.

- Having every electrical tool certified, every year
- Fencing of sites
- Scaffolding erection, certifying, take-down, where in the past a long ladder used to do.
- certification of all trades

The aggregate effect is around 5-10% of pure build costs.

3 - Greedy councils and their contributions to infrastructure and reserves. The apartment saga in Auckland is indicative: up from $3-6K to $40K. Go figure.

4 - The extended consenting and RMA processes, add pure time (and as we all should know, Time=Money) to a development. This 'carry' (as the jargon has it) is probably around 5-10% of outright total costs, and in a protracted case, could easily be triple that.

5 - Good ol' supply and demand. Section prices alone in many areas are what a house price would have been in 2000. Add the build cost, at a conservative $2000/sq m, and the total starts to resemble that 6+ times multiplier. A constrained supply of land may not be by itself a major factor. But it may be the straw that breaks the camel's bank.

So there we have it. And notice the common factor.

It's not greedy developers, banks, or investors.

It's Gummint being its normal, stoopid self.