Harvard researchers score another point for expensive gasoline: carbon emission reduction.

By CS | Published: March 3, 2010

A new study from Harvard’s Belfer Center for Science and International Affairs. says that to reach targets for greenhouse gas emissions cuts, gas prices will have to be raised as high as $7 per gallon, says a Times blog piece.

And as I’ve chronicled, there are a bevy of other ways we’d benefit from higher gas prices, not the least of which would be more government revenue. A mere $1 tax on the price of gasoline would raise $400 million a day. Per day. That’s $140 billion a year. That’s more than a putty fix for our gaping deficit.

The federal gas tax is stuck at 18 cents per gallon and has been since the early 1990s. It hasn’t crept up for inflation or the sizable increase in the cost to build roads. The gas tax has become the political third rail in Washington. Nobody wants to touch it. Healthcare, as scary as it is to mess with, evokes fewer complaints than would a gas tax.

The failure to address our fuel addiction through a device as simple as a gas tax is one of the most colossal failures of our government. This is not a small issue.

Just raise it (the gas tax) already. The future–a constructive one–has to begin at some point. May as well start now.

Posted in Uncategorized | Leave a comment

Thomas Friedman isn’t always my favorite, but he nails this…

By CS | Published: February 17, 2010

From today’s column in the Times.

The last two paragraphs make for a compact summary — and one that shouldn’t be debatable:

“Even if climate change proves less catastrophic than some fear, in a world that is forecast to grow from 6.7 billion to 9.2 billion people between now and 2050, more and more of whom will live like Americans, demand for renewable energy and clean water is going to soar. It is obviously going to be the next great global industry.

“China, of course, understands that, which is why it is investing heavily in clean-tech, efficiency and high-speed rail. It sees the future trends and is betting on them. Indeed, I suspect China is quietly laughing at us right now. And Iran, Russia, Venezuela and the whole OPEC gang are high-fiving each other. Nothing better serves their interests than to see Americans becoming confused about climate change, and, therefore, less inclined to move toward clean-tech and, therefore, more certain to remain addicted to oil. Yes, sir, it is morning in Saudi Arabia.”

Posted in Uncategorized | Leave a comment

Electric car realities heating up on the West Coast.

By CS | Published: February 16, 2010

Cities such as San Francisco and San Jose are installing curbside plug-ins for electric cars. Times story here. San Francisco is going so far as to alter their building codes to require charging stations within new parking garages. (Hate to be the first developer dinged with that one!)

Overall this is a great thing. And it’s not surprising that California is leading the way. Imagine if that state wasn’t in the hole for $20 billion…

Posted in Uncategorized | Leave a comment

The Dead Cat Bounce and the 50% Rule? You can’t make this stuff up. But Rich Dad can.

By CS | Published: February 15, 2010

Quite the witch’s brew of a column here by Robert Kiyosaki, author of Rich Dad/Poor Dad. He’s telling us where the stock market is going — sub 6,000 — according to a couple of steadfast rules: the dead cat bounce and the 50% rule.  I think Citadel is opening a new hedge fund with both of these strategies in mind, in fact.

I’m not sure about dead cats as they relate to the market.  You might as well have a monkey throw darts at the wall. That’s my opinion. But Kiyosaki is the rich guy, not me, so maybe you’re better off with dead cats rather than live monkeys.

Below is a graph Kiyosaki used in his Yahoo! column to illustrate the “dead cat bounce.”  I think that says it all.

This is copied from Robert Kiyosaki's column on Yahoo! Finance. Not much else I can say.

This is copied from Robert Kiyosaki's column on Yahoo! Finance. Not much else I can say.

Posted in Uncategorized | Leave a comment

The Audi Super Bowl commercial was awesome.

By CS | Published: February 8, 2010

If you didn’t see it, please go do so right now. I’ve embedded the video below. The commercial was funny the first time I saw it during the game, but as with all things Super Bowl, I was a bit distracted (perhaps it was the 19-month-old boy, high on pizza, bouncing off the walls of my house?).

I watched the spot again today. It’s even awesomer (sic) than I remember.

But apparently, there are some greenies who are offended by Audi’s fun poking.

I agree with Adam on the importance of revamping how we view, produce and use energy, but we shouldn’t take ourselves so seriously that we can’t laugh once in a while. And if you can’t laugh at this ad… that’s a damned shame, because it’s funny as hell.

A less critical, but interesting take on the ad by Grist’s David Roberts is here. He thinks this kind of satirical approach is exactly the way to get on the good sides of people who may not be teetotaling uber greenies, but who generally want to do the right thing. You know, the guy who may grumble about having to fiddle with a recycling bin every week, but who, on most days, is a guy who picks up his candy wrappers and doesn’t throw his newspapers into the garbage.

All that said, Audi’s TDI — clean diesel — is pretty cool and it’s a technology we should embrace in the U.S. (C’mon, GM) Although I’m sure Audi’s TDI vehicles are prone to some of the same electronic dependability issues that plague its other cool cars. Why can’t Audis run like Subarus? Sigh.

Anyway, here’s the spot. Congrats to Audi for winning, in my book, the Super Bowl Ad of the Year Award.

I can’t stop watching this:

Posted in Uncategorized | Leave a comment

Unsurprisingly, gas prices headed back up.

By CS | Published: January 11, 2010

They’re well past $3 in Chicago now; heading there across most of the country now. This January rise is the same pattern we saw in 2008. Not sure if we’ll get back to those 2008 heights ($4.50 per gallon) this year, but it’s possible if the economy holds up — far from a given.

AP: Heading past $3 across the country.

The real question is when will we start to see American government start to be proactive? I’m talking about density planning, mass transit, and, gasp!, more gasoline taxes. Instead we get more roads, more roads, more roads. More roads for less people going less places. Road work as stimulus… disappointing.

Some unpopular decisions will have to be made for the U.S. to get back out ahead of the world. Will we see such decisions from pandering politicians? I’m not sure that we will until change becomes harder than it should be.

Posted in Uncategorized | Leave a comment

New “old” story in WSJ today, highlighting oil companies’ efforts to score big finds in deep water.

By CS | Published: January 8, 2010

The article once again recounts BP’s GIANT find in the Gulf from last fall. Never mind the fact that of those 3 billion barrels, only 1 billion are recoverable and that, ultimately, 1 billion barrels, while they may be worth $80 billion, is only enough oil to last the U.S. about seven weeks.

The article gets better, however. I leave you with this, courtesy of the WSJ:

The discoveries come as many of the giant oil fields of the past century are beginning to dry up, and as some experts are warning that global oil production could soon reach a peak and begin to decline. The new deepwater fields represent a huge and largely untapped source of oil, which could help ease fears that the world won’t be able to meet demand for energy, which is expected to grow rapidly in coming years.

For oil companies, the discoveries mean something more: After a decade of retreat, large Western energy companies are taking back the lead in the quest to find oil. “A lot of people can get the very easy oil,” says George Kirkland, Chevron’s vice chairman. “There’s just not a lot of it left.”

Posted in Uncategorized | Leave a comment

Oh, dear. Pity the oil lobby and its “facts.”

By CS | Published: January 7, 2010

Good story in the Times today. Boils down to this: The federal government wants more money and more oversight on oil and gas drilling in public lands out West. Makes sense to me. It’s been well-reported that the Bush administration gave drilling companies copious rights at bargain prices while undervaluing oil and gas resources owned by the American people.

American Petroleum Institute’s president, Jack Gerard, makes an appearance in the article. He said the decision by the Interior Department was a setback for the economy. I’m not sure about that. It might be a setback, however, for some of API’s members who have grown used to sucking oil out of places such as Colorado and Wyoming and paying next to nothing in royalties.

Next Gerard cleverly misuses a fact to try and illustrate how the Obama administration has been starving the American people of home-grown energy. According to the Times, Gerard says “that federal revenue from oil and gas leases in the region known as the intermountain West had fallen by more than 80 percent” during 2009.

That might be true. But he failed to cite the fact that the price of oil in 2009 was basically HALF of what it was in 2008. So there’s a 50% drop right there. Add in the fact that demand and consumption is WAY down in the U.S. since the spring of 2008 and, whoa, there you have your 80% drop. (The oil and gas fields of the Mountain West will be some of the first to shut off when demand drops as their production costs tend to be quite a bit higher than those in Alaska and Texas.)

Nice use of a “fact” by the API. Too bad it came with none of the relevant context.

Posted in Uncategorized | Leave a comment

What does orange juice have in common with oil?

By CS | Published: January 6, 2010

Not a whole lot, really, except that both commodities owe their existence to the amazing properties of solar power. One product, oranges, manifests after a short growing season and the other, oil, takes several hundred thousand years longer…

But it’s also interesting that the prices for both staples swing higher on the news of extreme cold across the country. I live in Chicago. This winter has arrived with a fierceness that I don’t recall seeing for years. The orchard farmers of Florida are seeing the same thing (albeit at temperatures 40 degrees warmer than Chicago’s). New England and the West, same thing. So the price of oil has jumped to more than $83 this week as people’s furnaces burn more natural gas and heating oil from Dallas to Maine.

And the price of orange juice futures, on fears some of the crop could be lost to frost, jumped to $1.50 per pound today, the highest level in two years. Today’s oil price, incidentally, is the highest since October 2008.

So high oil — in the winter — means high orange juice? Perhaps it does. But what does this mean? Not a whole lot, I suppose, unless you’re an inflation hedger.

More interestingly — is there a way to play statistical arbitrage between these markets? I can’t imagine the orange juice market is as efficient as the oil market. Or perhaps I have that reversed? Clearly, I’m no quant.

If I were, I’d be working on my orange juice-oil algorithm right now and preparing to print money. My shingle: OJ-Petrol Traders.

Posted in Uncategorized | Leave a comment

Iranian soldiers allegedly go into Iraq, occupy oilfield. Oil spikes $2. Mahmoud? Or is it Goldman?!

By CS | Published: December 18, 2009

Interesting.

Iranian troops go into Iraq, occupy a giant oil field. Then they leave. The price of oil predictably shoots up for much of the day in the U.S. before falling back, though it was still up 60 cents on the day.

Has ol’ Mahmoud Ahmadinejad become a canny manipulator of commodities markets?  Or are his talents still limited to wearing strangely casual Western sport coats and cracking unbelievable rhetoric?

Or — perhaps even more sinister — has Goldman Sachs figured out a way to control battalions of Iranian troops?   A-ha!

Quick, who knows if Lloyd Blankfein speaks Farsi?

Posted in Uncategorized | Leave a comment