**Free** chapters and mobile app for iphone and android at www.thenatureofvalue.com

Caveat: I am the author of this book.

Some reviews from noted academics and value investors:

"Nick Gogerty has done a phenomenal job of developing and clarifying economic value when it comes to equity investing. His book incorporates new thinking about the economy as a dynamically evolving, complex, adaptive system. Gogerty introduces new ways to apply these concepts on the granular scale of the firm. This book will certainly enhance the reader's ability to make good investments and is a must-read for any thoughtful investor."

--Guy Spier, Managing Partner, Aquamarine Capital,

author of *The Education of a Value Investor*

...It is impossible to read this book and not think about how it applies to your own business. ...I have a raft of notes that I think will be of value to my consulting clients... ...You don't have to agree with Gogerty's points to get benefit from the ecological perspective... The ideas are straightforward, but multilayered, deep, and important. This is a book I will re-read, refer to, and think about for years to come. Tom Brakke researchpuzzle.com/blog/2014/06/11/the-nature-of-value/

In the great tradition of Charlie Munger's 'worldly wisdom,' Nick Gogerty delivers a multidisciplinary approach to finding investment value. Through brilliant graphics and a unique lens, he educates the reader on how to discern investment opportunities that go well beyond currently reported financial results to gain insights into how value shifts over time. Any investor who feels the 'value investing' paradigm is lacking in its ability to navigate our increasingly complex world will benefit from the tools Gogerty offers.

(Paul Johnson, Columbia Business School)

The convergence of economics and biology is fertile ground that offers a path out of the dark age of static equilibrium and efficient markets. Nick Gogerty's illuminating book gives us a deeper and more robust understanding of the complex dynamics that create and sustain value.

(Steve Waite, author of *Quantum Investing* and *Boomernomics*)

From the Inside Flap

**USING EVOLUTION** as the template to understand

growth, *The Nature of Value* takes a firstprinciples

approach to explore the parallels

between economic and ecological systems. Not

only does Gogerty show how value is born out

of tiny sparks of adaptive innovation, but he

also explores the full scope of the economy as

a complex network. He borrows from an array of

disciplines--including anthropology, psychology,

ecology, physics, sociology, and ethics--and,

most revealing of all, examines how evolution's

processes can help investors avoid risk and

improve their allocation decisions.

Starting with a look at how innovation creates

value for firms, Gogerty considers the economic

niches where companies compete and explores

how they can create defensive moats to enhance

their ability to survive. Throughout the book,

Gogerty demonstrates how this ecological understanding

of the economy can help allocators

improve their performance, supporting his arguments

with extensive data and years of practitioner

experience from scientific, social, and economic

disciplines. Gogerty's practical takeaways,

couched in vivid explanations and accompanied

by intuitive illustrations, help investors of all

backgrounds gain fresh insight into the behavior

of corporations and the economy in general.

**Free** chapters and mobile app for iphone and android at www.thenatureofvalue.com

Caveat: I am the author of this book.

Some reviews from noted academics and value investors:

"Nick Gogerty has done a phenomenal job of developing and clarifying economic value when it comes to equity investing. His book incorporates new thinking about the economy as a dynamically evolving, complex, adaptive system. Gogerty introduces new ways to apply these concepts on the granular scale of the firm. This book will certainly enhance the reader's ability to make good investments and is a must-read for any thoughtful investor."

--Guy Spier, Managing Partner, Aquamarine Capital,

author of *The Education of a Value Investor*

...It is impossible to read this book and not think about how it applies to your own business. ...I have a raft of notes that I think will be of value to my consulting clients... ...You don't have to agree with Gogerty's points to get benefit from the ecological perspective... The ideas are straightforward, but multilayered, deep, and important. This is a book I will re-read, refer to, and think about for years to come. Tom Brakke researchpuzzle.com/blog/2014/06/11/the-nature-of-value/

In the great tradition of Charlie Munger's 'worldly wisdom,' Nick Gogerty delivers a multidisciplinary approach to finding investment value. Through brilliant graphics and a unique lens, he educates the reader on how to discern investment opportunities that go well beyond currently reported financial results to gain insights into how value shifts over time. Any investor who feels the 'value investing' paradigm is lacking in its ability to navigate our increasingly complex world will benefit from the tools Gogerty offers.

(Paul Johnson, Columbia Business School)

The convergence of economics and biology is fertile ground that offers a path out of the dark age of static equilibrium and efficient markets. Nick Gogerty's illuminating book gives us a deeper and more robust understanding of the complex dynamics that create and sustain value.

(Steve Waite, author of *Quantum Investing* and *Boomernomics*)

From the Inside Flap

**USING EVOLUTION** as the template to understand

growth, *The Nature of Value* takes a firstprinciples

approach to explore the parallels

between economic and ecological systems. Not

only does Gogerty show how value is born out

of tiny sparks of adaptive innovation, but he

also explores the full scope of the economy as

a complex network. He borrows from an array of

disciplines--including anthropology, psychology,

ecology, physics, sociology, and ethics--and,

most revealing of all, examines how evolution's

processes can help investors avoid risk and

improve their allocation decisions.

Starting with a look at how innovation creates

value for firms, Gogerty considers the economic

niches where companies compete and explores

how they can create defensive moats to enhance

their ability to survive. Throughout the book,

Gogerty demonstrates how this ecological understanding

of the economy can help allocators

improve their performance, supporting his arguments

with extensive data and years of practitioner

experience from scientific, social, and economic

disciplines. Gogerty's practical takeaways,

couched in vivid explanations and accompanied

by intuitive illustrations, help investors of all

backgrounds gain fresh insight into the behavior

of corporations and the economy in general.

But, what if the subjective is more powerful and often more right than monolithic objective truth?

There is a field of statistics called Bayesian statistics deemed to be subjective by many. Most financial statistics and risk analysis uses the frequentist approach. Frequentists use historical data poured into a model to generate a probability distribution. This probability distribution is then assumed to reflect not only the past, but also the future probabilities.

The way we measure risk in finance with forms of price volatility is deeply flawed. Risk is assumed to be an absolute number or factor existing out there waiting to be found like Planck’s constant. This pursuit or faith in an absolute numerical representation of risk. Finance and economics are ultimately social activities. There are no absolute truths for a given point in time.

**Battle of the Frequentists and the Bayesians**

The counter approach to frequentists is Bayesian inference. An important book about Bayesian history has come out. Its importance isn’t in pushing the science of Bayesian statistics forward, but rather in explaining the power of an idea so controversial and yet so useful it couldn’t be killed.

The Theory That Would Not Die by Sharon Bertsch McGrayne tells the tale of how Bayes theorem has quietly changed the world by solving some of the most vexing problems. McGrayne’s research is only surpassed by her ability to tell an excellent story. Some of the amazing stories involving Bayesian analysis include:

- How Bayes helped win D-Day and may have shortened WWII by 2 years.

- The RAND think tank predicted the chances of a nuclear bomb accident with a sample size of zero in 1945.

- How Bayes theory found a Russian sub in the real Hunt for Red October in 1968?

- How the navy started looking for its lost nuclear bomb off the coast of Spain in 1966. The bomb was found 260 yards away from the Bayesian guess. The original search field was 140 square miles of ocean.

- Why and how was Bayes theory was almost killed by academics in the US?

- Hints that the multi-billion dollar Renaissance Technology Hedge fund is filled with Bayesians.

The power of Bayesian analysis should resonate with any financial professional. Here is a quote from Madansky a researcher challenged with finding the future rate of nuclear accidents when the sample size was zero:

“if you are willing to admit a shred of disbelief, you can let Bayes theorem work…Bayes is the only other theology that you can go to. It’s just sort of natural for this particular problem. At least that’s how I felt back then.”

Please note the term theology above. For statisticians there are 2 strong camps the frequentists and the Bayesian’s. These belief systems are at strong odds with one another. Almost all financial risk methods are based on frequentist approaches. Moody’s had the CDO pricing model that assumed all house prices in the US couldn’t go down because they never had.

**Dead Turkeys are frequentists**

The frequentist approach would fall foul of Taleb’s turkey model in which a turkey is fed and cared for 999 days. The frequentist turkey never predicts he will be at dinner on day 1,000 as the prior samples allow for no such possibility or event.

Bayesian analysis allows for counterfactuals, speculation and conjecture. This is a good thing for truth can be stranger than and past experience. How many 2009 risk models had the US losing its AAA status built into them as a scenario in the foreseeable future (5-7 years)?

The work using Bayes inferences and scenarios from the RAND institute went on to influence the design of safety protocols for the US nuclear arsenal. I like the idea of a tool like Bayesian inference being used for safety design. My hope is that such thought would go into designing rules and regulations for economic systems. As it is the thinking and thought behind banking rules is often crude or overly frequentist.

The statistician Tukey also makes an appearance in the fight to keep Bayes theorem alive and applied. At one point he articulates the value of subjectivity and multiple views of truth, something finance and risk management need to acknowledge as worthwhile and valid.

Tukey explains calling objectivity an “heirloom” and “a fallacy... Engineers are not expected to design identical bridges or aircraft. Why should statisticians be expected to reach identical results from examinations of the same set of data?”

If you manage money, risk or have to make predictions, I would strongly suggest reading this gripping book, The Theory That Would Not Die. After completing it, if you are like me you will run to your browser to find Bayesian tools and tips. Your objective view of the world may never look the same again.

]]>But, what if the subjective is more powerful and often more right than monolithic objective truth?

There is a field of statistics called Bayesian statistics deemed to be subjective by many. Most financial statistics and risk analysis uses the frequentist approach. Frequentists use historical data poured into a model to generate a probability distribution. This probability distribution is then assumed to reflect not only the past, but also the future probabilities.

The way we measure risk in finance with forms of price volatility is deeply flawed. Risk is assumed to be an absolute number or factor existing out there waiting to be found like Planck’s constant. This pursuit or faith in an absolute numerical representation of risk. Finance and economics are ultimately social activities. There are no absolute truths for a given point in time.

**Battle of the Frequentists and the Bayesians**

The counter approach to frequentists is Bayesian inference. An important book about Bayesian history has come out. Its importance isn’t in pushing the science of Bayesian statistics forward, but rather in explaining the power of an idea so controversial and yet so useful it couldn’t be killed.

The Theory That Would Not Die by Sharon Bertsch McGrayne tells the tale of how Bayes theorem has quietly changed the world by solving some of the most vexing problems. McGrayne’s research is only surpassed by her ability to tell an excellent story. Some of the amazing stories involving Bayesian analysis include:

- How Bayes helped win D-Day and may have shortened WWII by 2 years.

- The RAND think tank predicted the chances of a nuclear bomb accident with a sample size of zero in 1945.

- How Bayes theory found a Russian sub in the real Hunt for Red October in 1968?

- How the navy started looking for its lost nuclear bomb off the coast of Spain in 1966. The bomb was found 260 yards away from the Bayesian guess. The original search field was 140 square miles of ocean.

- Why and how was Bayes theory was almost killed by academics in the US?

- Hints that the multi-billion dollar Renaissance Technology Hedge fund is filled with Bayesians.

The power of Bayesian analysis should resonate with any financial professional. Here is a quote from Madansky a researcher challenged with finding the future rate of nuclear accidents when the sample size was zero:

“if you are willing to admit a shred of disbelief, you can let Bayes theorem work…Bayes is the only other theology that you can go to. It’s just sort of natural for this particular problem. At least that’s how I felt back then.”

Please note the term theology above. For statisticians there are 2 strong camps the frequentists and the Bayesian’s. These belief systems are at strong odds with one another. Almost all financial risk methods are based on frequentist approaches. Moody’s had the CDO pricing model that assumed all house prices in the US couldn’t go down because they never had.

**Dead Turkeys are frequentists**

The frequentist approach would fall foul of Taleb’s turkey model in which a turkey is fed and cared for 999 days. The frequentist turkey never predicts he will be at dinner on day 1,000 as the prior samples allow for no such possibility or event.

Bayesian analysis allows for counterfactuals, speculation and conjecture. This is a good thing for truth can be stranger than and past experience. How many 2009 risk models had the US losing its AAA status built into them as a scenario in the foreseeable future (5-7 years)?

The work using Bayes inferences and scenarios from the RAND institute went on to influence the design of safety protocols for the US nuclear arsenal. I like the idea of a tool like Bayesian inference being used for safety design. My hope is that such thought would go into designing rules and regulations for economic systems. As it is the thinking and thought behind banking rules is often crude or overly frequentist.

The statistician Tukey also makes an appearance in the fight to keep Bayes theorem alive and applied. At one point he articulates the value of subjectivity and multiple views of truth, something finance and risk management need to acknowledge as worthwhile and valid.

Tukey explains calling objectivity an “heirloom” and “a fallacy... Engineers are not expected to design identical bridges or aircraft. Why should statisticians be expected to reach identical results from examinations of the same set of data?”

If you manage money, risk or have to make predictions, I would strongly suggest reading this gripping book, The Theory That Would Not Die. After completing it, if you are like me you will run to your browser to find Bayesian tools and tips. Your objective view of the world may never look the same again.

]]>I just came across this notice from Forex.com it looks ominous for Gain Capital (GCAP) owner of Forex.com and takes away a means for US citizens to own gold:

We wanted to make you aware of some upcoming changes to FOREX.com’s product offering. As a result of the Dodd-Frank Act enacted by US Congress, a new regulation prohibiting US residents from trading over the counter precious metals, including gold and silver, will go into effect on Friday, July 15, 2011.

In conjunction with this new regulation, FOREX.com must discontinue metals trading for US residents on Friday, July 15, 2011 at the close of trading at 5pm ET. As a result, all open metals positions must be closed by July 15, 2011 at 5pm ET.

We encourage you to wind down your trading activity in these products over the next month in anticipation of the new rule, as any open XAU or XAG positions that remain open prior to July 15, 2011 at approximately 5:00 pm ET will be automatically liquidated.

We sincerely regret any inconvenience complying with the new U.S. regulation may cause you. Should you have any questions, please feel free to contact our customer service team.

Sincerely,

The Team at FOREX.com

]]>

I just came across this notice from Forex.com it looks ominous for Gain Capital (GCAP) owner of Forex.com and takes away a means for US citizens to own gold:

We wanted to make you aware of some upcoming changes to FOREX.com’s product offering. As a result of the Dodd-Frank Act enacted by US Congress, a new regulation prohibiting US residents from trading over the counter precious metals, including gold and silver, will go into effect on Friday, July 15, 2011.

In conjunction with this new regulation, FOREX.com must discontinue metals trading for US residents on Friday, July 15, 2011 at the close of trading at 5pm ET. As a result, all open metals positions must be closed by July 15, 2011 at 5pm ET.

We encourage you to wind down your trading activity in these products over the next month in anticipation of the new rule, as any open XAU or XAG positions that remain open prior to July 15, 2011 at approximately 5:00 pm ET will be automatically liquidated.

We sincerely regret any inconvenience complying with the new U.S. regulation may cause you. Should you have any questions, please feel free to contact our customer service team.

Sincerely,

The Team at FOREX.com

]]>

Many Americans would now believe these types of actions to be the sole activity of banana republics. Things can change in an instant. This post isn't about a party, policy or president, merely a pointer to a past that isn't really that far past. If you are young read more history, if you are old, don't forget.

Here is a transcript of the video I had produced for $1 on Mechanical turk:

The third indispensable element in building the new prosperity is closely related to creating new jobs and halting inflation. We must protect the position of the American dollar as a pillar of monetary stability around the world. In the past seven years there has been an average of one international monetary crisis every year.

Now who gains from these crises? Not the working man, not the investor, not the real producers of wealth. The gainers are the international money speculators. Because they thrive on crises, they help to create them. In recent weeks the speculators have been waging an all out war on the American dollar.

The strength of a nation's currency is based on the strength of that nation's economy, and the American economy is by far the strongest in the world. Accordingly, I have directed the Secretary of the Treasury to take the action necessary to defend the dollar against the speculators. I directed Secretary Connally to suspend temporarily the convertibility of the dollar into gold or other reserve assets except in amounts and conditions determined to be in the interest of monetary stability and in the best interest of the United States.

Now what does this action, which is very technical, what does it mean for you? Let me lay to rest the bugaboo of what is called devaluation. If you want to buy a foreign car or take a trip abroad, market conditions may cause your dollar to buy slightly less. But if you are among the overwhelming majority of Americans who buy American-made products in America, your dollar will be worth just as much tomorrow as it is today. The effect of this action in other words will be to stabilize the dollar. Now this action will not win us any friends among the international money traders, but our primary concern is with the American workers and with fair competition around the world.

To our friends abroad including the many responsible members of the international banking community who are dedicated to stability in the flow of trade, I give this assurance: The United States has always been, and will continue to be, a forward-looking and trustworthy trading partner. In full cooperation with the International Monetary Fund and those who trade with us we will press for the necessary reforms to set up an urgently needed new international monetary system.

Stability and equal treatment is in everybody's best interest. I am determined that the American dollar must never again be a hostage in the hands of international speculators. I am taking one further step to protect the dollar, to improve our balance of payments, and to increase jobs for Americans.

As a temporary measure I am today imposing an additional tax of ten percent on goods imported into the United States. This is a better solution for international trade than direct controls on the amount of imports. This import tax is a temporary action. It isn't directed against any other country. It's an action to make certain that American products will not be at a disadvantage because of unfair exchange rates.

When the unfair treatment is ended, the import tax will end as well. As a result of these actions the product of American labor will be more competitive and the unfair edge that some of our foreign competition has will be removed. This is a major reason why our trade balance has eroded over the past 15 years.

]]>

Many Americans would now believe these types of actions to be the sole activity of banana republics. Things can change in an instant. This post isn't about a party, policy or president, merely a pointer to a past that isn't really that far past. If you are young read more history, if you are old, don't forget.

Here is a transcript of the video I had produced for $1 on Mechanical turk:

The third indispensable element in building the new prosperity is closely related to creating new jobs and halting inflation. We must protect the position of the American dollar as a pillar of monetary stability around the world. In the past seven years there has been an average of one international monetary crisis every year.

Now who gains from these crises? Not the working man, not the investor, not the real producers of wealth. The gainers are the international money speculators. Because they thrive on crises, they help to create them. In recent weeks the speculators have been waging an all out war on the American dollar.

The strength of a nation's currency is based on the strength of that nation's economy, and the American economy is by far the strongest in the world. Accordingly, I have directed the Secretary of the Treasury to take the action necessary to defend the dollar against the speculators. I directed Secretary Connally to suspend temporarily the convertibility of the dollar into gold or other reserve assets except in amounts and conditions determined to be in the interest of monetary stability and in the best interest of the United States.

Now what does this action, which is very technical, what does it mean for you? Let me lay to rest the bugaboo of what is called devaluation. If you want to buy a foreign car or take a trip abroad, market conditions may cause your dollar to buy slightly less. But if you are among the overwhelming majority of Americans who buy American-made products in America, your dollar will be worth just as much tomorrow as it is today. The effect of this action in other words will be to stabilize the dollar. Now this action will not win us any friends among the international money traders, but our primary concern is with the American workers and with fair competition around the world.

To our friends abroad including the many responsible members of the international banking community who are dedicated to stability in the flow of trade, I give this assurance: The United States has always been, and will continue to be, a forward-looking and trustworthy trading partner. In full cooperation with the International Monetary Fund and those who trade with us we will press for the necessary reforms to set up an urgently needed new international monetary system.

Stability and equal treatment is in everybody's best interest. I am determined that the American dollar must never again be a hostage in the hands of international speculators. I am taking one further step to protect the dollar, to improve our balance of payments, and to increase jobs for Americans.

As a temporary measure I am today imposing an additional tax of ten percent on goods imported into the United States. This is a better solution for international trade than direct controls on the amount of imports. This import tax is a temporary action. It isn't directed against any other country. It's an action to make certain that American products will not be at a disadvantage because of unfair exchange rates.

When the unfair treatment is ended, the import tax will end as well. As a result of these actions the product of American labor will be more competitive and the unfair edge that some of our foreign competition has will be removed. This is a major reason why our trade balance has eroded over the past 15 years.

]]>

Joseph Gagnon, Future of the Fed from Roosevelt Institute on Vimeo.

Listen carefully above about pushing up the price of assets. Value investors will understand what a fools errand this is. When the fed "pushes up the price" of something long term value hasn't changed with the exception of the dollars made for the purchase. Those dollar's value will go down and most likely the assets will revert to value. Distressed assets work the same, but should the fed really be a tarted up vulture fund dry humping the latest depressed asset of some too big too fail banker.I attended the Roosevelt Institute conference on the future of the Federal Reserve hosted at the Harvard Club in New York. A friend joked it sounded like a meeting of the illuminati. Well not quite that much fun, no hoods, tin foil hats or goat sacrifices, just an 8AM continental breakfast with bagels and chit chat about monetary plumbing.

The intimidating thing is the vapid fawning discussions of Fed power. The Fed and others believe it can affect un-employment etc. a la the Phillips curve argument. Many economists in the room seemed to believe the Fed can cure cancer, anorexia and malaria if just given more mandates or regulatory "tools" as the wonks say. Lots of bright people in the room were focused on the Fed hammer as an uber tool for any problem, this perception is a major part of the problem.

There was a frightening lack of global perspective displayed with the exception of Jorg Bibow, who said, "be thankful, just for the Fed's problems. Just look at the ECB."

Most who argue about Fed policy or markets are talking from a statistical sample of one and deserve the attention that such sample sizes warrant. Belief in continued American exceptionalism can be parochial and limiting to thoughtful debate.

I view the Fed as having asymmetric power, meaning mostly they can do only harm and the best good they can do is to function passively similar to good surgeons in the 15th century and with about the same level of tools, knowledge and sadly over-confidence.

The conference had good discussions of the woeful failures in regulatory oversight. These oversights were failures to act which would be criminal negligence in the private sector. Why isn't there an equivalent to fiscal or regulatory manslaughter? Where are the class action suits against regulatory failures due to inaction?

Dennis Kelleher had some good comments about this and other things.

Plumbing as infrastructure is an asymmetric tool of empire. Plumbing is what keeps the empire running, it only facilitates growth but doesn't garuntee it.

Plumbing's failure to function can limit or constrain growth. My opinion is that the Fed is mere plumbing and quite mucked up. Watch the videos if you dare. Elliptical utterances followed by non-falsifiable tautologies fill the air and these are mostly the good guys seeking transparency and improvement.

Mike Konczal did a great job putting the conference together. P.S. it couldn't have been illuminati (it was free to any and all and they let me in)

Many presenters were honest in their wish for a more open Fed and many used the phrase regulatory capture to indicate their beliefs that banks own the Fed which is probably legally true if the shareholder structure of the Fed were public. Kind of weird to think the Fed Shareholders could be the firms being regulated by it...what could possibly go wrong with that closed loop?

I find the Fed silly with its sense of secrecy and importance. With the exception of D-Day invasion type activity, rarely has widespread secrecy been proven to be in the interest of any citizenry long term. If the Fed is so important that it can only function secretly it will find at some point the tide turns and its air of mystery won't induce awe but rather deep doubts, by then it will be too late.

Many present pointed to the excellent Rolling Stone Article about the Real Wives of Wall Street. If this is the tip, how big is the iceberg? I advised friends and family to get out using Norwegian Krone Overlay's in early 2009.

]]>

Joseph Gagnon, Future of the Fed from Roosevelt Institute on Vimeo.

Listen carefully above about pushing up the price of assets. Value investors will understand what a fools errand this is. When the fed "pushes up the price" of something long term value hasn't changed with the exception of the dollars made for the purchase. Those dollar's value will go down and most likely the assets will revert to value. Distressed assets work the same, but should the fed really be a tarted up vulture fund dry humping the latest depressed asset of some too big too fail banker.I attended the Roosevelt Institute conference on the future of the Federal Reserve hosted at the Harvard Club in New York. A friend joked it sounded like a meeting of the illuminati. Well not quite that much fun, no hoods, tin foil hats or goat sacrifices, just an 8AM continental breakfast with bagels and chit chat about monetary plumbing.

The intimidating thing is the vapid fawning discussions of Fed power. The Fed and others believe it can affect un-employment etc. a la the Phillips curve argument. Many economists in the room seemed to believe the Fed can cure cancer, anorexia and malaria if just given more mandates or regulatory "tools" as the wonks say. Lots of bright people in the room were focused on the Fed hammer as an uber tool for any problem, this perception is a major part of the problem.

There was a frightening lack of global perspective displayed with the exception of Jorg Bibow, who said, "be thankful, just for the Fed's problems. Just look at the ECB."

Most who argue about Fed policy or markets are talking from a statistical sample of one and deserve the attention that such sample sizes warrant. Belief in continued American exceptionalism can be parochial and limiting to thoughtful debate.

I view the Fed as having asymmetric power, meaning mostly they can do only harm and the best good they can do is to function passively similar to good surgeons in the 15th century and with about the same level of tools, knowledge and sadly over-confidence.

The conference had good discussions of the woeful failures in regulatory oversight. These oversights were failures to act which would be criminal negligence in the private sector. Why isn't there an equivalent to fiscal or regulatory manslaughter? Where are the class action suits against regulatory failures due to inaction?

Dennis Kelleher had some good comments about this and other things.

Plumbing as infrastructure is an asymmetric tool of empire. Plumbing is what keeps the empire running, it only facilitates growth but doesn't garuntee it.

Plumbing's failure to function can limit or constrain growth. My opinion is that the Fed is mere plumbing and quite mucked up. Watch the videos if you dare. Elliptical utterances followed by non-falsifiable tautologies fill the air and these are mostly the good guys seeking transparency and improvement.

Mike Konczal did a great job putting the conference together. P.S. it couldn't have been illuminati (it was free to any and all and they let me in)

Many presenters were honest in their wish for a more open Fed and many used the phrase regulatory capture to indicate their beliefs that banks own the Fed which is probably legally true if the shareholder structure of the Fed were public. Kind of weird to think the Fed Shareholders could be the firms being regulated by it...what could possibly go wrong with that closed loop?

I find the Fed silly with its sense of secrecy and importance. With the exception of D-Day invasion type activity, rarely has widespread secrecy been proven to be in the interest of any citizenry long term. If the Fed is so important that it can only function secretly it will find at some point the tide turns and its air of mystery won't induce awe but rather deep doubts, by then it will be too late.

Many present pointed to the excellent Rolling Stone Article about the Real Wives of Wall Street. If this is the tip, how big is the iceberg? I advised friends and family to get out using Norwegian Krone Overlay's in early 2009.

]]>

We respond to risk based on our perception of it. Geological nuclear risk is mis-perceived and could be costly for investors. Thinking about risk using a technique called actionable systems thinking can help.

Systems thinking involves looking at risks or value creating processes as whole systems. This technique simplifies and clarifies. Many risk managers get carried away with complex tools and piles of data. These tools and data are used to as the basis for complicated models with costly and sometimes tragic consequences.

Events in Japan raise concerns about US nuclear risk. The NRC (Nuclear Regulatory Commission) released the risks associated with, “an earthquake that would cause damage to a reactor's core releasing radiation”. The information as released mis-represents the risks.

Risk is often expressed as the likelihood of an event occurring within a period of time such as a year. The time period is arbitrary. Like the useless financial Value at Risk metrics used by banks, co-variances and other non-sense these misrepresentations lead to bad choices.

Natural event risk is usually represented as an event happening every X number of years. This presentation of data is misleading. A more useful presentation is to use the unit of the system lifecycle.

Buying a house on a flood plain vulnerable to a once in a hundred year flood (1:100 years) may feel fairly safe. If you plan on owning the house for 33 years (its functional system life period), you have a 33% chance of disaster. People think differently when risk is expressed in system lifecycles.

The Indian Point nuclear facility near New York city is reported to have a one in 10,000 year risk of geological activity that could breach the core leading to radioactive material escape. This sounds safe until one considers the plant as a system. Systems have functional lives. Many nuclear reactors are re-licensed for 10 or more year increments. A 50 year functional life isn't extraordinary.

Systems thinking risk applied to the Indian Point reactor puts failure odds at 1:200When viewed as a 50 year system the Indian Point nuclear facility has a 1:200 chance of earthquake risk breaching the core and spilling radiation during its life. 50x1:10,000= 1:200 If during the design and permitting phase someone presented such a low probability high impact risk with that figure it would most likely be un-acceptable.

On the other side of the coin using the 1:10,000 year figure means on any given day the odds are 1:3,652,000 which many may say is acceptable. In the actionable systems risk framework, the correct metric to use is the systems life indicating **The nuclear system has a 1:200 chance of geologically induced failure**.

Each of the 104 reactors in the US operates independently, but combined can be considered as the US nuclear system. Using NRC data aggregating the US nuclear geological system risk one gets annual odds of 1:480 for a failure in the system. If one assumes each reactor is licensed and operational for 50 years, the risk horizon for a geological event in the US nuclear system is 10.42% or roughly 1:10 over a 50 year lifetime. 50x1:480 =50:480

This seems high for just one dimension of risk, namely geological. I am a fan of nuclear as a "clean" energy but only when risk is designed and priced correctly. Most likely some reactors should be shut down or moved if geographic and other risk vectors were presented using a systems risk perspective.

Nuclear operator's liabilities are capped under the Price act at $560 million but the potential national cost for such an incident could exceed $500 billion. (see article link below).

The nuclear and finance industries needs to measure risk using systems thinking and systems frameworks to better engineer in safety. The higher risk operators in the Spreadsheet attached to this article may face material cost impacts from shut-down or redesigns of reactors.

Even NASA gets it wrongNASA got risk wrong with the space Shuttle. NASA estimated the space shuttle system to be over 99.9999% safe. Nobel prize wining physicist Richard Feynman brilliantly described his role on the Challenger Blue ribbon panel in his book “What do you care what other people think?”. Feynman calculated probability of shuttle failure as 1:96. NASA organizationally saw risk and reported it the way it wanted to, not the way it was. Bankers and Utility companies may have the same behavioral risk drives.

The utility companies listed below may have margins shrink or costs increase if risks are correctly interpreted using a systems thinking perspective. This could be short term expensive for a few, but better for society in the long run.

In my day job I help banks, family offices and hedge funds understand risk and opportunity. This task often starts by getting rid of all price based models like VaR, volatility, beta, BIS standards and Modern Portfolio Theory. Losing these frames of belief causes distress at first until the Systems Thinking approach is brought in. Letting go of familiar but wrong metrics to replace them unfamiliar metrics that may bear bad news is rarely easy or popular.

Systems thinking mostly ignores pricePrice reflects two opposing opinions expressed at a single point in time. 99% of investors can’t beat a buy and hold index. It stands to reason 99% of the opinions creating price are probably wrong when considering the correct measurement of value and risk.

**participants symbol list**: GE (General Electric), HIT (Hitachi), EXC (Excelon), AEE (Ameren), CEP (Constellation energy), DUK (Duke energy), D (Dominion Energy), private (Energy Northwest), FE (First Energy), FPL (Florida Light and Power), private (Nebraska Public Power District), NU (Northeast Utilities), NMC (Nuclear Management Company), NA (Omaha Public Power District), PCG (Pacific Gas and Electric), PGN (Progress Energy), SO (Southern Company), TVE (Tennessee Valley Authority), TXU (TXU energy), XCL (Xcel Energy)

Geological risk table:

Nuclear facility and geological risk an event compromising the reactor. | Yearly rate | Risk as % | Systems rate @ 50 years | Systems Risk as % |

1. Indian Point 3, Buchanan, N.Y.: 1 in 10,000 chance each year. Old estimate: 1 in 17,241. Change in risk: 72 percent. | 10,000 | 0.0001 | 200 | 0.50% |

2. Pilgrim 1, Plymouth, Mass.: 1 in 14,493 chance each year. Old estimate: 1 in 125,000. Change in risk: 763 percent. | 14,493 | 6.89988E-05 | 289.86 | 0.34% |

3. Limerick 1, Limerick, Pa.: 1 in 18,868 chance each year. Old estimate: 1 in 45,455. Change in risk: 141 percent. | 18,868 | 5.29998E-05 | 377.36 | 0.26% |

3. Limerick 2, Limerick, Pa.: 1 in 18,868 chance each year. Old estimate: 1 in 45,455. Change in risk: 141 percent. | 18,868 | 5.29998E-05 | 377.36 | 0.26% |

5. Sequoyah 1, Soddy-Daisy, Tenn.: 1 in 19,608 chance each year. Old estimate: 1 in 102,041. Change in risk: 420 percent. | 19,608 | 5.09996E-05 | 392.16 | 0.25% |

5. Sequoyah 2, Soddy-Daisy, Tenn.: 1 in 19,608 chance each year. Old estimate: 1 in 102,041. Change in risk: 420 percent. | 19,608 | 5.09996E-05 | 392.16 | 0.25% |

7. Beaver Valley 1, Shippingport, Pa.: 1 in 20,833 chance each year. Old estimate: 1 in 76,923. Change in risk: 269 percent. | 20,833 | 4.80008E-05 | 416.66 | 0.24% |

8. Saint Lucie 1, Jensen Beach, Fla.: 1 in 21,739 chance each year. Old estimate: N/A. Change in risk: N/A. | 21,739 | 4.60003E-05 | 434.78 | 0.23% |

8. Saint Lucie 2, Jensen Beach, Fla.: 1 in 21,739 chance each year. Old estimate: N/A. Change in risk: N/A. | 21,739 | 4.60003E-05 | 434.78 | 0.23% |

10. North Anna 1, Louisa, Va.: 1 in 22,727 chance each year. Old estimate: 1 in 31,250. Change in risk: 38 percent. | 31,250 | 0.000032 | 625 | 0.16% |

10. North Anna 2, Louisa, Va.: 1 in 22,727 chance each year. Old estimate: 1 in 31,250. Change in risk: 38 percent. | 31,250 | 0.000032 | 625 | 0.16% |

12. Oconee 1, Seneca, S.C.: 1 in 23,256 chance each year. Old estimate: 1 in 100,000. Change in risk: 330 percent. | 23,256 | 4.29997E-05 | 465.12 | 0.21% |

12. Oconee 2, Seneca, S.C.: 1 in 23,256 chance each year. Old estimate: 1 in 100,000. Change in risk: 330 percent. | 23,256 | 4.29997E-05 | 465.12 | 0.21% |

12. Oconee 3, Seneca, S.C.: 1 in 23,256 chance each year. Old estimate: 1 in 100,000. Change in risk: 330 percent. | 23,256 | 4.29997E-05 | 465.12 | 0.21% |

15. Diablo Canyon 1, Avila Beach, Calif.: 1 in 23,810 chance each year. Old estimate: N/A. Change in risk: N/A. | 23,810 | 4.19992E-05 | 476.2 | 0.21% |

15. Diablo Canyon 2, Avila Beach, Calif.: 1 in 23,810 chance each year. Old estimate: N/A. Change in risk: N/A. | 23,810 | 4.19992E-05 | 476.2 | 0.21% |

17. Three Mile Island 1, Middletown, Pa.: 1 in 25,000 chance each year. Old estimate: 1 in 45,455. Change in risk: 82 percent. | 25,000 | 0.00004 | 500 | 0.20% |

18. Palo Verde 1, Wintersburg, Ariz.: 1 in 26,316 chance each year. Old estimate: N/A. Change in risk: N/A. | 26,316 | 3.79997E-05 | 526.32 | 0.19% |

18. Palo Verde 2, Wintersburg, Ariz.: 1 in 26,316 chance each year. Old estimate: N/A. Change in risk: N/A. | 26,316 | 3.79997E-05 | 526.32 | 0.19% |

18. Palo Verde 3, Wintersburg, Ariz.: 1 in 26,316 chance each year. Old estimate: N/A. Change in risk: N/A. | 26,316 | 3.79997E-05 | 526.32 | 0.19% |

18. Summer, Jenkensville, S.C.: 1 in 26,316 chance each year. Old estimate: 1 in 138,889. Change in risk: 428 percent. | 26,316 | 3.79997E-05 | 526.32 | 0.19% |

22. Catawba 1, York, S.C.: 1 in 27,027 chance each year. Old estimate: 1 in 33,333. Change in risk: 23 percent. | 27,027 | 3.7E-05 | 540.54 | 0.19% |

22. Catawba 2, York, S.C.: 1 in 27,027 chance each year. Old estimate: 1 in 33,333. Change in risk: 23 percent. | 27,027 | 3.7E-05 | 540.54 | 0.19% |

24. Watts Bar 1, Spring City, Tenn.: 1 in 27,778 chance each year. Old estimate: 1 in 178,571. Change in risk: 543 percent. | 27,778 | 3.59997E-05 | 555.56 | 0.18% |

25. Indian Point 2, Buchanan, N.Y.: 1 in 30,303 chance each year. Old estimate: 1 in 71,429. Change in risk: 136 percent. | 30,303 | 3.3E-05 | 606.06 | 0.17% |

26. Duane Arnold, Palo, Iowa: 1 in 31,250 chance each year. Old estimate: N/A. Change in risk: N/A. | 31,250 | 0.000032 | 625 | 0.16% |

27. McGuire 1, Huntersville, N.C.: 1 in 32,258 chance each year. Old estimate: 1 in 35,714. Change in risk: 11 percent. | 32,258 | 3.10001E-05 | 645.16 | 0.16% |

27. McGuire 2, Huntersville, N.C.: 1 in 32,258 chance each year. Old estimate: 1 in 35,714. Change in risk: 11 percent. | 32,258 | 3.10001E-05 | 645.16 | 0.16% |

29. Farley 1, Columbia, Ala.: 1 in 35,714 chance each year. Old estimate: 1 in 263,158. Change in risk: 637 percent. | 35,714 | 2.80002E-05 | 714.28 | 0.14% |

29. Farley 2, Columbia, Ala.: 1 in 35,714 chance each year. Old estimate: 1 in 263,158. Change in risk: 637 percent. | 35,714 | 2.80002E-05 | 714.28 | 0.14% |

31. Quad Cities 1, Cordova, Ill.: 1 in 37,037 chance each year. Old estimate: 1 in 71,429. Change in risk: 93 percent. | 37,037 | 2.7E-05 | 740.74 | 0.14% |

31. Quad Cities 2, Cordova, Ill.: 1 in 37,037 chance each year. Old estimate: 1 in 71,429. Change in risk: 93 percent. | 37,037 | 2.7E-05 | 740.74 | 0.14% |

33. River Bend 1, St. Francisville, La.: 1 in 40,000 chance each year. Old estimate: 1 in 370,370. Change in risk: 826 percent. | 40,000 | 0.000025 | 800 | 0.13% |

34. Peach Bottom 2, Delta, Pa.: 1 in 41,667 chance each year. Old estimate: 1 in 120,482. Change in risk: 189 percent. | 41,667 | 2.39998E-05 | 833.34 | 0.12% |

34. Peach Bottom 3, Delta, Pa.: 1 in 41,667 chance each year. Old estimate: 1 in 120,482. Change in risk: 189 percent. | 41,667 | 2.39998E-05 | 833.34 | 0.12% |

36. Crystal River 3, Crystal River, Fla.: 1 in 45,455 chance each year. Old estimate: 1 in 192,308. Change in risk: 323 percent. | 45,455 | 2.19998E-05 | 909.1 | 0.11% |

36. Seabrook 1, Seabrook, N.H.: 1 in 45,455 chance each year. Old estimate: 1 in 114,943. Change in risk: 153 percent. | 45,455 | 2.19998E-05 | 909.1 | 0.11% |

36. Beaver Valley 2, Shippingport, Pa.: 1 in 45,455 chance each year. Old estimate: 1 in 188,679. Change in risk: 315 percent. | 45,455 | 2.19998E-05 | 909.1 | 0.11% |

39. Perry 1, Perry, Ohio: 1 in 47,619 chance each year. Old estimate: 1 in 1,176,471. Change in risk: 2371 percent. | 47,619 | 2.1E-05 | 952.38 | 0.11% |

39. Columbia 1, Richland, Wash.: 1 in 47,619 chance each year. Old estimate: N/A. Change in risk: N/A. | 47,619 | 2.1E-05 | 952.38 | 0.11% |

41. Waterford 3, Killona, La.: 1 in 50,000 chance each year. Old estimate: 1 in 833,333. Change in risk: 1567 percent. | 50,000 | 0.00002 | 1000 | 0.10% |

42. Dresden 2, Morris, Ill.: 1 in 52,632 chance each year. Old estimate: 1 in 434,783. Change in risk: 726 percent. | 52,632 | 1.89998E-05 | 1052.64 | 0.09% |

42. Dresden 3, Morris, Ill.: 1 in 52,632 chance each year. Old estimate: 1 in 434,783. Change in risk: 726 percent. | 52,532 | 1.9036E-05 | 1050.64 | 0.10% |

42. Monticello, Monticello, Minn.: 1 in 52,632 chance each year. Old estimate: 1 in 38,462. Change in risk: -27 percent. | 52,632 | 1.89998E-05 | 1052.64 | 0.09% |

45. Wolf Creek 1, Burlington, Kansas: 1 in 55,556 chance each year. Old estimate: 1 in 400,000. Change in risk: 620 percent. | 55,556 | 1.79999E-05 | 1111.12 | 0.09% |

46. San Onofre 2, San Clemente, Calif.: 1 in 58,824 chance each year. Old estimate: N/A. Change in risk: N/A. | 58,824 | 1.69999E-05 | 1176.48 | 0.08% |

46. San Onofre 3, San Clemente, Calif.: 1 in 58,824 chance each year. Old estimate: N/A. Change in risk: N/A. | 58,824 | 1.69999E-05 | 1176.48 | 0.08% |

48. Millstone 3, Waterford, Conn.: 1 in 66,667 chance each year. Old estimate: 1 in 100,000. Change in risk: 50 percent. | 66,667 | 1.49999E-05 | 1333.34 | 0.07% |

48. Brunswick 1, Southport, N.C.: 1 in 66,667 chance each year. Old estimate: 1 in 263,158. Change in risk: 295 percent. | 66,667 | 1.49999E-05 | 1333.34 | 0.07% |

48. Brunswick 2, Southport, N.C.: 1 in 66,667 chance each year. Old estimate: 1 in 263,158. Change in risk: 295 percent. | 66,667 | 1.49999E-05 | 1333.34 | 0.07% |

48. Robinson 2, Hartsville, S.C.: 1 in 66,667 chance each year. Old estimate: 1 in 370,370. Change in risk: 456 percent. | 66,667 | 1.49999E-05 | 1333.34 | 0.07% |

52. Oyster Creek, Forked River, N.J.: 1 in 71,429 chance each year. Old estimate: 1 in 126,582. Change in risk: 77 percent. | 71,429 | 1.39999E-05 | 1428.58 | 0.07% |

53. Fort Calhoun, Fort Calhoun, Neb.: 1 in 76,923 chance each year. Old estimate: N/A. Change in risk: N/A. | 76,923 | 1.3E-05 | 1538.46 | 0.07% |

53. Ginna, Ontario, N.Y.: 1 in 76,923 chance each year. Old estimate: 1 in 238,095. Change in risk: 210 percent. | 76,923 | 1.3E-05 | 1538.46 | 0.07% |

53. Susquehanna 1, Salem Township, Pa.: 1 in 76,923 chance each year. Old estimate: 1 in 416,667. Change in risk: 442 percent. | 76,923 | 1.3E-05 | 1538.46 | 0.07% |

53. Susquehanna 2, Salem Township, Pa.: 1 in 76,923 chance each year. Old estimate: 1 in 416,667. Change in risk: 442 percent. | 76,923 | 1.3E-05 | 1538.46 | 0.07% |

57. Calvert Cliffs 2, Lusby, Md.: 1 in 83,333 chance each year. Old estimate: 1 in 116,279. Change in risk: 40 percent. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

57. D.C. Cook 1, Bridgman, Mich.: 1 in 83,333 chance each year. Old estimate: N/A. Change in risk: N/A. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

57. D.C. Cook 2, Bridgman, Mich.: 1 in 83,333 chance each year. Old estimate: N/A. Change in risk: N/A. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

57. Grand Gulf 1, Port Gibson, Miss.: 1 in 83,333 chance each year. Old estimate: 1 in 106,383. Change in risk: 28 percent. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

57. Kewaunee, Kewaunee, Wis.: 1 in 83,333 chance each year. Old estimate: 1 in 71,429. Change in risk: -14 percent. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

62. Millstone 2, Waterford, Conn.: 1 in 90,909 chance each year. Old estimate: 1 in 156,250. Change in risk: 72 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

62. Salem 1, Hancocks Bridge, N.J.: 1 in 90,909 chance each year. Old estimate: 1 in 172,414. Change in risk: 90 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

62. Salem 2, Hancocks Bridge, N.J.: 1 in 90,909 chance each year. Old estimate: 1 in 172,414. Change in risk: 90 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

62. Point Beach 1, Two Rivers, Wis.: 1 in 90,909 chance each year. Old estimate: 1 in 76,923. Change in risk: -15 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

62. Point Beach 2, Two Rivers, Wis.: 1 in 90,909 chance each year. Old estimate: 1 in 76,923. Change in risk: -15 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

67. Turkey Point 3, Homestead, Fla.: 1 in 100,000 chance each year. Old estimate: N/A. Change in risk: N/A. | 100,000 | 0.00001 | 2000 | 0.05% |

67. Turkey Point 4, Homestead, Fla.: 1 in 100,000 chance each year. Old estimate: N/A. Change in risk: N/A. | 100,000 | 0.00001 | 2000 | 0.05% |

67. Calvert Cliffs 1, Lusby, Md.: 1 in 100,000 chance each year. Old estimate: 1 in 142,857. Change in risk: 43 percent. | 100,000 | 0.00001 | 2000 | 0.05% |

70. Vermont Yankee, Vernon, Vt.: 1 in 123,457 chance each year. Old estimate: 1 in 434,783. Change in risk: 252 percent. | 123,457 | 8.09999E-06 | 2469.14 | 0.04% |

71. Braidwood 1, Braceville, Ill.: 1 in 136,986 chance each year. Old estimate: 1 in 1,785,714. Change in risk: 1204 percent. | 136,986 | 7.30002E-06 | 2739.72 | 0.04% |

71. Braidwood 2, Braceville, Ill.: 1 in 136,986 chance each year. Old estimate: 1 in 1,785,714. Change in risk: 1204 percent. | 136,986 | 7.30002E-06 | 2739.72 | 0.04% |

73. Vogtle 1, Waynesboro, Ga.: 1 in 140,845 chance each year. Old estimate: 1 in 384,615. Change in risk: 173 percent. | 140,845 | 7.1E-06 | 2816.9 | 0.04% |

73. Vogtle 2, Waynesboro, Ga.: 1 in 140,845 chance each year. Old estimate: 1 in 384,615. Change in risk: 173 percent. | 140,845 | 7.1E-06 | 2816.9 | 0.04% |

75. Cooper, Brownville, Neb.: 1 in 142,857 chance each year. Old estimate: N/A. Change in risk: N/A. | 142,857 | 7.00001E-06 | 2857.14 | 0.04% |

76. Davis-Besse, Oak Harbor, Ohio: 1 in 149,254 chance each year. Old estimate: 1 in 625,000. Change in risk: 319 percent. | 149,254 | 6.69999E-06 | 2985.08 | 0.03% |

77. Palisades, Covert, Mich.: 1 in 156,250 chance each year. Old estimate: N/A. Change in risk: N/A. | 156,250 | 0.0000064 | 3125 | 0.03% |

78. South Texas 1, Bay City, Texas: 1 in 158,730 chance each year. Old estimate: 1 in 1,298,701. Change in risk: 718 percent. | 158,730 | 6.30001E-06 | 3174.6 | 0.03% |

78. South Texas 2, Bay City, Texas: 1 in 158,730 chance each year. Old estimate: 1 in 1,298,701. Change in risk: 718 percent. | 158,730 | 6.30001E-06 | 3174.6 | 0.03% |

80. FitzPatrick, Scriba, N.Y.: 1 in 163,934 chance each year. Old estimate: 1 in 833,333. Change in risk: 408 percent. | 163,934 | 6.10002E-06 | 3278.68 | 0.03% |

81. Byron 1, Byron, Ill.: 1 in 172,414 chance each year. Old estimate: 1 in 1,470,588. Change in risk: 753 percent. | 172,414 | 5.79999E-06 | 3448.28 | 0.03% |

81. Byron 2, Byron, Ill.: 1 in 172,414 chance each year. Old estimate: 1 in 1,470,588. Change in risk: 753 percent. | 172,414 | 5.79999E-06 | 3448.28 | 0.03% |

83. Surry 1, Surry, Va.: 1 in 175,439 chance each year. Old estimate: 1 in 123,457. Change in risk: -30 percent. | 175,439 | 5.69999E-06 | 3508.78 | 0.03% |

83. Surry 2, Surry, Va.: 1 in 175,439 chance each year. Old estimate: 1 in 123,457. Change in risk: -30 percent. | 175,439 | 5.69999E-06 | 3508.78 | 0.03% |

85. Nine Mile Point 2, Scriba, N.Y.: 1 in 178,571 chance each year. Old estimate: 1 in 1,000,000. Change in risk: 460 percent. | 178,571 | 5.60001E-06 | 3571.42 | 0.03% |

86. Browns Ferry 2, Athens, Ala.: 1 in 185,185 chance each year. Old estimate: 1 in 625,000. Change in risk: 238 percent. | 185,185 | 5.40001E-06 | 3703.7 | 0.03% |

86. Browns Ferry 3, Athens, Ala.: 1 in 185,185 chance each year. Old estimate: 1 in 625,000. Change in risk: 238 percent. | 185,185 | 5.40001E-06 | 3703.7 | 0.03% |

88. Nine Mile Point 1, Scriba, N.Y.: 1 in 238,095 chance each year. Old estimate: 1 in 1,724,138. Change in risk: 624 percent. | 238,095 | 4.2E-06 | 4761.9 | 0.02% |

88. Fermi 2, Monroe, Mich.: 1 in 238,095 chance each year. Old estimate: 1 in 625,000. Change in risk: 163 percent. | 238,095 | 4.2E-06 | 4761.9 | 0.02% |

90. Arkansas Nuclear 1, London, Ark.: 1 in 243,902 chance each year. Old estimate: 1 in 1,063,830. Change in risk: 336 percent. | 243,902 | 4.10001E-06 | 4878.04 | 0.02% |

90. Arkansas Nuclear 2, London, Ark.: 1 in 243,902 chance each year. Old estimate: 1 in 1,063,830. Change in risk: 336 percent. | 243,902 | 4.10001E-06 | 4878.04 | 0.02% |

92. Comanche Peak 1, Glen Rose, Texas: 1 in 250,000 chance each year. Old estimate: 1 in 833,333. Change in risk: 233 percent. | 250,000 | 0.000004 | 5000 | 0.02% |

92. Comanche Peak 2, Glen Rose, Texas: 1 in 250,000 chance each year. Old estimate: 1 in 833,333. Change in risk: 233 percent. | 250,000 | 0.000004 | 5000 | 0.02% |

94. Browns Ferry 1, Athens, Ala.: 1 in 270,270 chance each year. Old estimate: 1 in 1,000,000. Change in risk: 270 percent. | 270,270 | 3.7E-06 | 5405.4 | 0.02% |

95. Prairie Island 1, Welch, Minn.: 1 in 333,333 chance each year. Old estimate: 1 in 714,286. Change in risk: 114 percent. | 333,333 | 3E-06 | 6666.66 | 0.02% |

95. Prairie Island 2, Welch, Minn.: 1 in 333,333 chance each year. Old estimate: 1 in 714,286. Change in risk: 114 percent. | 333,333 | 3E-06 | 6666.66 | 0.02% |

97. La Salle 1, Marseilles, Ill.: 1 in 357,143 chance each year. Old estimate: 1 in 1,851,852. Change in risk: 419 percent. | 357,143 | 2.8E-06 | 7142.86 | 0.01% |

97. La Salle 2, Marseilles, Ill.: 1 in 357,143 chance each year. Old estimate: 1 in 1,851,852. Change in risk: 419 percent. | 357,143 | 2.8E-06 | 7142.86 | 0.01% |

97. Hope Creek 1, Hancocks Bridge, N.J.: 1 in 357,143 chance each year. Old estimate: 1 in 909,091. Change in risk: 155 percent. | 357,143 | 2.8E-06 | 7142.86 | 0.01% |

100. Clinton, Clinton, Ill.: 1 in 400,000 chance each year. Old estimate: 1 in 370,370. Change in risk: -7 percent. | 400,000 | 0.0000025 | 8000 | 0.01% |

101. Shearon Harris 1, New Hill, N.C.: 1 in 434,783 chance each year. Old estimate: 1 in 277,778. Change in risk: -36 percent. | 434,783 | 2.3E-06 | 8695.66 | 0.01% |

102. Hatch 1, Baxley, Ga.: 1 in 454,545 chance each year. Old estimate: 1 in 1,351,351. Change in risk: 197 percent. | 454,545 | 2.2E-06 | 9090.9 | 0.01% |

102. Hatch 2, Baxley, Ga.: 1 in 454,545 chance each year. Old estimate: 1 in 1,351,351. Change in risk: 197 percent. | 454,545 | 2.2E-06 | 9090.9 | 0.01% |

104. Callaway, Fulton, Mo.: 1 in 500,000 chance each year. Old estimate: N/A. Change in risk: N/A. | 500,000 | 0.000002 | 10000 | 0.01% |

www.msnbc.msn.com/id/42103936/ns/world_n.../ | 0.21% | 10.42% | ||

Spreadsheet risk Data: from NRC Geological nuclear risk.XLS

http://www.msnbc.msn.com/id/42103936/ns/world_news-asia-pacific/

http://www.aolnews.com/2011/03/18/would-fund-protect-us-taxpayers-from-nuke-disaster-here/

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We respond to risk based on our perception of it. Geological nuclear risk is mis-perceived and could be costly for investors. Thinking about risk using a technique called actionable systems thinking can help.

Systems thinking involves looking at risks or value creating processes as whole systems. This technique simplifies and clarifies. Many risk managers get carried away with complex tools and piles of data. These tools and data are used to as the basis for complicated models with costly and sometimes tragic consequences.

Events in Japan raise concerns about US nuclear risk. The NRC (Nuclear Regulatory Commission) released the risks associated with, “an earthquake that would cause damage to a reactor's core releasing radiation”. The information as released mis-represents the risks.

Risk is often expressed as the likelihood of an event occurring within a period of time such as a year. The time period is arbitrary. Like the useless financial Value at Risk metrics used by banks, co-variances and other non-sense these misrepresentations lead to bad choices.

Natural event risk is usually represented as an event happening every X number of years. This presentation of data is misleading. A more useful presentation is to use the unit of the system lifecycle.

Buying a house on a flood plain vulnerable to a once in a hundred year flood (1:100 years) may feel fairly safe. If you plan on owning the house for 33 years (its functional system life period), you have a 33% chance of disaster. People think differently when risk is expressed in system lifecycles.

The Indian Point nuclear facility near New York city is reported to have a one in 10,000 year risk of geological activity that could breach the core leading to radioactive material escape. This sounds safe until one considers the plant as a system. Systems have functional lives. Many nuclear reactors are re-licensed for 10 or more year increments. A 50 year functional life isn't extraordinary.

Systems thinking risk applied to the Indian Point reactor puts failure odds at 1:200When viewed as a 50 year system the Indian Point nuclear facility has a 1:200 chance of earthquake risk breaching the core and spilling radiation during its life. 50x1:10,000= 1:200 If during the design and permitting phase someone presented such a low probability high impact risk with that figure it would most likely be un-acceptable.

On the other side of the coin using the 1:10,000 year figure means on any given day the odds are 1:3,652,000 which many may say is acceptable. In the actionable systems risk framework, the correct metric to use is the systems life indicating **The nuclear system has a 1:200 chance of geologically induced failure**.

Each of the 104 reactors in the US operates independently, but combined can be considered as the US nuclear system. Using NRC data aggregating the US nuclear geological system risk one gets annual odds of 1:480 for a failure in the system. If one assumes each reactor is licensed and operational for 50 years, the risk horizon for a geological event in the US nuclear system is 10.42% or roughly 1:10 over a 50 year lifetime. 50x1:480 =50:480

This seems high for just one dimension of risk, namely geological. I am a fan of nuclear as a "clean" energy but only when risk is designed and priced correctly. Most likely some reactors should be shut down or moved if geographic and other risk vectors were presented using a systems risk perspective.

Nuclear operator's liabilities are capped under the Price act at $560 million but the potential national cost for such an incident could exceed $500 billion. (see article link below).

The nuclear and finance industries needs to measure risk using systems thinking and systems frameworks to better engineer in safety. The higher risk operators in the Spreadsheet attached to this article may face material cost impacts from shut-down or redesigns of reactors.

Even NASA gets it wrongNASA got risk wrong with the space Shuttle. NASA estimated the space shuttle system to be over 99.9999% safe. Nobel prize wining physicist Richard Feynman brilliantly described his role on the Challenger Blue ribbon panel in his book “What do you care what other people think?”. Feynman calculated probability of shuttle failure as 1:96. NASA organizationally saw risk and reported it the way it wanted to, not the way it was. Bankers and Utility companies may have the same behavioral risk drives.

The utility companies listed below may have margins shrink or costs increase if risks are correctly interpreted using a systems thinking perspective. This could be short term expensive for a few, but better for society in the long run.

In my day job I help banks, family offices and hedge funds understand risk and opportunity. This task often starts by getting rid of all price based models like VaR, volatility, beta, BIS standards and Modern Portfolio Theory. Losing these frames of belief causes distress at first until the Systems Thinking approach is brought in. Letting go of familiar but wrong metrics to replace them unfamiliar metrics that may bear bad news is rarely easy or popular.

Systems thinking mostly ignores pricePrice reflects two opposing opinions expressed at a single point in time. 99% of investors can’t beat a buy and hold index. It stands to reason 99% of the opinions creating price are probably wrong when considering the correct measurement of value and risk.

**participants symbol list**: GE (General Electric), HIT (Hitachi), EXC (Excelon), AEE (Ameren), CEP (Constellation energy), DUK (Duke energy), D (Dominion Energy), private (Energy Northwest), FE (First Energy), FPL (Florida Light and Power), private (Nebraska Public Power District), NU (Northeast Utilities), NMC (Nuclear Management Company), NA (Omaha Public Power District), PCG (Pacific Gas and Electric), PGN (Progress Energy), SO (Southern Company), TVE (Tennessee Valley Authority), TXU (TXU energy), XCL (Xcel Energy)

Geological risk table:

Nuclear facility and geological risk an event compromising the reactor. | Yearly rate | Risk as % | Systems rate @ 50 years | Systems Risk as % |

1. Indian Point 3, Buchanan, N.Y.: 1 in 10,000 chance each year. Old estimate: 1 in 17,241. Change in risk: 72 percent. | 10,000 | 0.0001 | 200 | 0.50% |

2. Pilgrim 1, Plymouth, Mass.: 1 in 14,493 chance each year. Old estimate: 1 in 125,000. Change in risk: 763 percent. | 14,493 | 6.89988E-05 | 289.86 | 0.34% |

3. Limerick 1, Limerick, Pa.: 1 in 18,868 chance each year. Old estimate: 1 in 45,455. Change in risk: 141 percent. | 18,868 | 5.29998E-05 | 377.36 | 0.26% |

3. Limerick 2, Limerick, Pa.: 1 in 18,868 chance each year. Old estimate: 1 in 45,455. Change in risk: 141 percent. | 18,868 | 5.29998E-05 | 377.36 | 0.26% |

5. Sequoyah 1, Soddy-Daisy, Tenn.: 1 in 19,608 chance each year. Old estimate: 1 in 102,041. Change in risk: 420 percent. | 19,608 | 5.09996E-05 | 392.16 | 0.25% |

5. Sequoyah 2, Soddy-Daisy, Tenn.: 1 in 19,608 chance each year. Old estimate: 1 in 102,041. Change in risk: 420 percent. | 19,608 | 5.09996E-05 | 392.16 | 0.25% |

7. Beaver Valley 1, Shippingport, Pa.: 1 in 20,833 chance each year. Old estimate: 1 in 76,923. Change in risk: 269 percent. | 20,833 | 4.80008E-05 | 416.66 | 0.24% |

8. Saint Lucie 1, Jensen Beach, Fla.: 1 in 21,739 chance each year. Old estimate: N/A. Change in risk: N/A. | 21,739 | 4.60003E-05 | 434.78 | 0.23% |

8. Saint Lucie 2, Jensen Beach, Fla.: 1 in 21,739 chance each year. Old estimate: N/A. Change in risk: N/A. | 21,739 | 4.60003E-05 | 434.78 | 0.23% |

10. North Anna 1, Louisa, Va.: 1 in 22,727 chance each year. Old estimate: 1 in 31,250. Change in risk: 38 percent. | 31,250 | 0.000032 | 625 | 0.16% |

10. North Anna 2, Louisa, Va.: 1 in 22,727 chance each year. Old estimate: 1 in 31,250. Change in risk: 38 percent. | 31,250 | 0.000032 | 625 | 0.16% |

12. Oconee 1, Seneca, S.C.: 1 in 23,256 chance each year. Old estimate: 1 in 100,000. Change in risk: 330 percent. | 23,256 | 4.29997E-05 | 465.12 | 0.21% |

12. Oconee 2, Seneca, S.C.: 1 in 23,256 chance each year. Old estimate: 1 in 100,000. Change in risk: 330 percent. | 23,256 | 4.29997E-05 | 465.12 | 0.21% |

12. Oconee 3, Seneca, S.C.: 1 in 23,256 chance each year. Old estimate: 1 in 100,000. Change in risk: 330 percent. | 23,256 | 4.29997E-05 | 465.12 | 0.21% |

15. Diablo Canyon 1, Avila Beach, Calif.: 1 in 23,810 chance each year. Old estimate: N/A. Change in risk: N/A. | 23,810 | 4.19992E-05 | 476.2 | 0.21% |

15. Diablo Canyon 2, Avila Beach, Calif.: 1 in 23,810 chance each year. Old estimate: N/A. Change in risk: N/A. | 23,810 | 4.19992E-05 | 476.2 | 0.21% |

17. Three Mile Island 1, Middletown, Pa.: 1 in 25,000 chance each year. Old estimate: 1 in 45,455. Change in risk: 82 percent. | 25,000 | 0.00004 | 500 | 0.20% |

18. Palo Verde 1, Wintersburg, Ariz.: 1 in 26,316 chance each year. Old estimate: N/A. Change in risk: N/A. | 26,316 | 3.79997E-05 | 526.32 | 0.19% |

18. Palo Verde 2, Wintersburg, Ariz.: 1 in 26,316 chance each year. Old estimate: N/A. Change in risk: N/A. | 26,316 | 3.79997E-05 | 526.32 | 0.19% |

18. Palo Verde 3, Wintersburg, Ariz.: 1 in 26,316 chance each year. Old estimate: N/A. Change in risk: N/A. | 26,316 | 3.79997E-05 | 526.32 | 0.19% |

18. Summer, Jenkensville, S.C.: 1 in 26,316 chance each year. Old estimate: 1 in 138,889. Change in risk: 428 percent. | 26,316 | 3.79997E-05 | 526.32 | 0.19% |

22. Catawba 1, York, S.C.: 1 in 27,027 chance each year. Old estimate: 1 in 33,333. Change in risk: 23 percent. | 27,027 | 3.7E-05 | 540.54 | 0.19% |

22. Catawba 2, York, S.C.: 1 in 27,027 chance each year. Old estimate: 1 in 33,333. Change in risk: 23 percent. | 27,027 | 3.7E-05 | 540.54 | 0.19% |

24. Watts Bar 1, Spring City, Tenn.: 1 in 27,778 chance each year. Old estimate: 1 in 178,571. Change in risk: 543 percent. | 27,778 | 3.59997E-05 | 555.56 | 0.18% |

25. Indian Point 2, Buchanan, N.Y.: 1 in 30,303 chance each year. Old estimate: 1 in 71,429. Change in risk: 136 percent. | 30,303 | 3.3E-05 | 606.06 | 0.17% |

26. Duane Arnold, Palo, Iowa: 1 in 31,250 chance each year. Old estimate: N/A. Change in risk: N/A. | 31,250 | 0.000032 | 625 | 0.16% |

27. McGuire 1, Huntersville, N.C.: 1 in 32,258 chance each year. Old estimate: 1 in 35,714. Change in risk: 11 percent. | 32,258 | 3.10001E-05 | 645.16 | 0.16% |

27. McGuire 2, Huntersville, N.C.: 1 in 32,258 chance each year. Old estimate: 1 in 35,714. Change in risk: 11 percent. | 32,258 | 3.10001E-05 | 645.16 | 0.16% |

29. Farley 1, Columbia, Ala.: 1 in 35,714 chance each year. Old estimate: 1 in 263,158. Change in risk: 637 percent. | 35,714 | 2.80002E-05 | 714.28 | 0.14% |

29. Farley 2, Columbia, Ala.: 1 in 35,714 chance each year. Old estimate: 1 in 263,158. Change in risk: 637 percent. | 35,714 | 2.80002E-05 | 714.28 | 0.14% |

31. Quad Cities 1, Cordova, Ill.: 1 in 37,037 chance each year. Old estimate: 1 in 71,429. Change in risk: 93 percent. | 37,037 | 2.7E-05 | 740.74 | 0.14% |

31. Quad Cities 2, Cordova, Ill.: 1 in 37,037 chance each year. Old estimate: 1 in 71,429. Change in risk: 93 percent. | 37,037 | 2.7E-05 | 740.74 | 0.14% |

33. River Bend 1, St. Francisville, La.: 1 in 40,000 chance each year. Old estimate: 1 in 370,370. Change in risk: 826 percent. | 40,000 | 0.000025 | 800 | 0.13% |

34. Peach Bottom 2, Delta, Pa.: 1 in 41,667 chance each year. Old estimate: 1 in 120,482. Change in risk: 189 percent. | 41,667 | 2.39998E-05 | 833.34 | 0.12% |

34. Peach Bottom 3, Delta, Pa.: 1 in 41,667 chance each year. Old estimate: 1 in 120,482. Change in risk: 189 percent. | 41,667 | 2.39998E-05 | 833.34 | 0.12% |

36. Crystal River 3, Crystal River, Fla.: 1 in 45,455 chance each year. Old estimate: 1 in 192,308. Change in risk: 323 percent. | 45,455 | 2.19998E-05 | 909.1 | 0.11% |

36. Seabrook 1, Seabrook, N.H.: 1 in 45,455 chance each year. Old estimate: 1 in 114,943. Change in risk: 153 percent. | 45,455 | 2.19998E-05 | 909.1 | 0.11% |

36. Beaver Valley 2, Shippingport, Pa.: 1 in 45,455 chance each year. Old estimate: 1 in 188,679. Change in risk: 315 percent. | 45,455 | 2.19998E-05 | 909.1 | 0.11% |

39. Perry 1, Perry, Ohio: 1 in 47,619 chance each year. Old estimate: 1 in 1,176,471. Change in risk: 2371 percent. | 47,619 | 2.1E-05 | 952.38 | 0.11% |

39. Columbia 1, Richland, Wash.: 1 in 47,619 chance each year. Old estimate: N/A. Change in risk: N/A. | 47,619 | 2.1E-05 | 952.38 | 0.11% |

41. Waterford 3, Killona, La.: 1 in 50,000 chance each year. Old estimate: 1 in 833,333. Change in risk: 1567 percent. | 50,000 | 0.00002 | 1000 | 0.10% |

42. Dresden 2, Morris, Ill.: 1 in 52,632 chance each year. Old estimate: 1 in 434,783. Change in risk: 726 percent. | 52,632 | 1.89998E-05 | 1052.64 | 0.09% |

42. Dresden 3, Morris, Ill.: 1 in 52,632 chance each year. Old estimate: 1 in 434,783. Change in risk: 726 percent. | 52,532 | 1.9036E-05 | 1050.64 | 0.10% |

42. Monticello, Monticello, Minn.: 1 in 52,632 chance each year. Old estimate: 1 in 38,462. Change in risk: -27 percent. | 52,632 | 1.89998E-05 | 1052.64 | 0.09% |

45. Wolf Creek 1, Burlington, Kansas: 1 in 55,556 chance each year. Old estimate: 1 in 400,000. Change in risk: 620 percent. | 55,556 | 1.79999E-05 | 1111.12 | 0.09% |

46. San Onofre 2, San Clemente, Calif.: 1 in 58,824 chance each year. Old estimate: N/A. Change in risk: N/A. | 58,824 | 1.69999E-05 | 1176.48 | 0.08% |

46. San Onofre 3, San Clemente, Calif.: 1 in 58,824 chance each year. Old estimate: N/A. Change in risk: N/A. | 58,824 | 1.69999E-05 | 1176.48 | 0.08% |

48. Millstone 3, Waterford, Conn.: 1 in 66,667 chance each year. Old estimate: 1 in 100,000. Change in risk: 50 percent. | 66,667 | 1.49999E-05 | 1333.34 | 0.07% |

48. Brunswick 1, Southport, N.C.: 1 in 66,667 chance each year. Old estimate: 1 in 263,158. Change in risk: 295 percent. | 66,667 | 1.49999E-05 | 1333.34 | 0.07% |

48. Brunswick 2, Southport, N.C.: 1 in 66,667 chance each year. Old estimate: 1 in 263,158. Change in risk: 295 percent. | 66,667 | 1.49999E-05 | 1333.34 | 0.07% |

48. Robinson 2, Hartsville, S.C.: 1 in 66,667 chance each year. Old estimate: 1 in 370,370. Change in risk: 456 percent. | 66,667 | 1.49999E-05 | 1333.34 | 0.07% |

52. Oyster Creek, Forked River, N.J.: 1 in 71,429 chance each year. Old estimate: 1 in 126,582. Change in risk: 77 percent. | 71,429 | 1.39999E-05 | 1428.58 | 0.07% |

53. Fort Calhoun, Fort Calhoun, Neb.: 1 in 76,923 chance each year. Old estimate: N/A. Change in risk: N/A. | 76,923 | 1.3E-05 | 1538.46 | 0.07% |

53. Ginna, Ontario, N.Y.: 1 in 76,923 chance each year. Old estimate: 1 in 238,095. Change in risk: 210 percent. | 76,923 | 1.3E-05 | 1538.46 | 0.07% |

53. Susquehanna 1, Salem Township, Pa.: 1 in 76,923 chance each year. Old estimate: 1 in 416,667. Change in risk: 442 percent. | 76,923 | 1.3E-05 | 1538.46 | 0.07% |

53. Susquehanna 2, Salem Township, Pa.: 1 in 76,923 chance each year. Old estimate: 1 in 416,667. Change in risk: 442 percent. | 76,923 | 1.3E-05 | 1538.46 | 0.07% |

57. Calvert Cliffs 2, Lusby, Md.: 1 in 83,333 chance each year. Old estimate: 1 in 116,279. Change in risk: 40 percent. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

57. D.C. Cook 1, Bridgman, Mich.: 1 in 83,333 chance each year. Old estimate: N/A. Change in risk: N/A. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

57. D.C. Cook 2, Bridgman, Mich.: 1 in 83,333 chance each year. Old estimate: N/A. Change in risk: N/A. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

57. Grand Gulf 1, Port Gibson, Miss.: 1 in 83,333 chance each year. Old estimate: 1 in 106,383. Change in risk: 28 percent. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

57. Kewaunee, Kewaunee, Wis.: 1 in 83,333 chance each year. Old estimate: 1 in 71,429. Change in risk: -14 percent. | 83,333 | 1.2E-05 | 1666.66 | 0.06% |

62. Millstone 2, Waterford, Conn.: 1 in 90,909 chance each year. Old estimate: 1 in 156,250. Change in risk: 72 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

62. Salem 1, Hancocks Bridge, N.J.: 1 in 90,909 chance each year. Old estimate: 1 in 172,414. Change in risk: 90 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

62. Salem 2, Hancocks Bridge, N.J.: 1 in 90,909 chance each year. Old estimate: 1 in 172,414. Change in risk: 90 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

62. Point Beach 1, Two Rivers, Wis.: 1 in 90,909 chance each year. Old estimate: 1 in 76,923. Change in risk: -15 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

62. Point Beach 2, Two Rivers, Wis.: 1 in 90,909 chance each year. Old estimate: 1 in 76,923. Change in risk: -15 percent. | 90,909 | 1.1E-05 | 1818.18 | 0.06% |

67. Turkey Point 3, Homestead, Fla.: 1 in 100,000 chance each year. Old estimate: N/A. Change in risk: N/A. | 100,000 | 0.00001 | 2000 | 0.05% |

67. Turkey Point 4, Homestead, Fla.: 1 in 100,000 chance each year. Old estimate: N/A. Change in risk: N/A. | 100,000 | 0.00001 | 2000 | 0.05% |

67. Calvert Cliffs 1, Lusby, Md.: 1 in 100,000 chance each year. Old estimate: 1 in 142,857. Change in risk: 43 percent. | 100,000 | 0.00001 | 2000 | 0.05% |

70. Vermont Yankee, Vernon, Vt.: 1 in 123,457 chance each year. Old estimate: 1 in 434,783. Change in risk: 252 percent. | 123,457 | 8.09999E-06 | 2469.14 | 0.04% |

71. Braidwood 1, Braceville, Ill.: 1 in 136,986 chance each year. Old estimate: 1 in 1,785,714. Change in risk: 1204 percent. | 136,986 | 7.30002E-06 | 2739.72 | 0.04% |

71. Braidwood 2, Braceville, Ill.: 1 in 136,986 chance each year. Old estimate: 1 in 1,785,714. Change in risk: 1204 percent. | 136,986 | 7.30002E-06 | 2739.72 | 0.04% |

73. Vogtle 1, Waynesboro, Ga.: 1 in 140,845 chance each year. Old estimate: 1 in 384,615. Change in risk: 173 percent. | 140,845 | 7.1E-06 | 2816.9 | 0.04% |

73. Vogtle 2, Waynesboro, Ga.: 1 in 140,845 chance each year. Old estimate: 1 in 384,615. Change in risk: 173 percent. | 140,845 | 7.1E-06 | 2816.9 | 0.04% |

75. Cooper, Brownville, Neb.: 1 in 142,857 chance each year. Old estimate: N/A. Change in risk: N/A. | 142,857 | 7.00001E-06 | 2857.14 | 0.04% |

76. Davis-Besse, Oak Harbor, Ohio: 1 in 149,254 chance each year. Old estimate: 1 in 625,000. Change in risk: 319 percent. | 149,254 | 6.69999E-06 | 2985.08 | 0.03% |

77. Palisades, Covert, Mich.: 1 in 156,250 chance each year. Old estimate: N/A. Change in risk: N/A. | 156,250 | 0.0000064 | 3125 | 0.03% |

78. South Texas 1, Bay City, Texas: 1 in 158,730 chance each year. Old estimate: 1 in 1,298,701. Change in risk: 718 percent. | 158,730 | 6.30001E-06 | 3174.6 | 0.03% |

78. South Texas 2, Bay City, Texas: 1 in 158,730 chance each year. Old estimate: 1 in 1,298,701. Change in risk: 718 percent. | 158,730 | 6.30001E-06 | 3174.6 | 0.03% |

80. FitzPatrick, Scriba, N.Y.: 1 in 163,934 chance each year. Old estimate: 1 in 833,333. Change in risk: 408 percent. | 163,934 | 6.10002E-06 | 3278.68 | 0.03% |

81. Byron 1, Byron, Ill.: 1 in 172,414 chance each year. Old estimate: 1 in 1,470,588. Change in risk: 753 percent. | 172,414 | 5.79999E-06 | 3448.28 | 0.03% |

81. Byron 2, Byron, Ill.: 1 in 172,414 chance each year. Old estimate: 1 in 1,470,588. Change in risk: 753 percent. | 172,414 | 5.79999E-06 | 3448.28 | 0.03% |

83. Surry 1, Surry, Va.: 1 in 175,439 chance each year. Old estimate: 1 in 123,457. Change in risk: -30 percent. | 175,439 | 5.69999E-06 | 3508.78 | 0.03% |

83. Surry 2, Surry, Va.: 1 in 175,439 chance each year. Old estimate: 1 in 123,457. Change in risk: -30 percent. | 175,439 | 5.69999E-06 | 3508.78 | 0.03% |

85. Nine Mile Point 2, Scriba, N.Y.: 1 in 178,571 chance each year. Old estimate: 1 in 1,000,000. Change in risk: 460 percent. | 178,571 | 5.60001E-06 | 3571.42 | 0.03% |

86. Browns Ferry 2, Athens, Ala.: 1 in 185,185 chance each year. Old estimate: 1 in 625,000. Change in risk: 238 percent. | 185,185 | 5.40001E-06 | 3703.7 | 0.03% |

86. Browns Ferry 3, Athens, Ala.: 1 in 185,185 chance each year. Old estimate: 1 in 625,000. Change in risk: 238 percent. | 185,185 | 5.40001E-06 | 3703.7 | 0.03% |

88. Nine Mile Point 1, Scriba, N.Y.: 1 in 238,095 chance each year. Old estimate: 1 in 1,724,138. Change in risk: 624 percent. | 238,095 | 4.2E-06 | 4761.9 | 0.02% |

88. Fermi 2, Monroe, Mich.: 1 in 238,095 chance each year. Old estimate: 1 in 625,000. Change in risk: 163 percent. | 238,095 | 4.2E-06 | 4761.9 | 0.02% |

90. Arkansas Nuclear 1, London, Ark.: 1 in 243,902 chance each year. Old estimate: 1 in 1,063,830. Change in risk: 336 percent. | 243,902 | 4.10001E-06 | 4878.04 | 0.02% |

90. Arkansas Nuclear 2, London, Ark.: 1 in 243,902 chance each year. Old estimate: 1 in 1,063,830. Change in risk: 336 percent. | 243,902 | 4.10001E-06 | 4878.04 | 0.02% |

92. Comanche Peak 1, Glen Rose, Texas: 1 in 250,000 chance each year. Old estimate: 1 in 833,333. Change in risk: 233 percent. | 250,000 | 0.000004 | 5000 | 0.02% |

92. Comanche Peak 2, Glen Rose, Texas: 1 in 250,000 chance each year. Old estimate: 1 in 833,333. Change in risk: 233 percent. | 250,000 | 0.000004 | 5000 | 0.02% |

94. Browns Ferry 1, Athens, Ala.: 1 in 270,270 chance each year. Old estimate: 1 in 1,000,000. Change in risk: 270 percent. | 270,270 | 3.7E-06 | 5405.4 | 0.02% |

95. Prairie Island 1, Welch, Minn.: 1 in 333,333 chance each year. Old estimate: 1 in 714,286. Change in risk: 114 percent. | 333,333 | 3E-06 | 6666.66 | 0.02% |

95. Prairie Island 2, Welch, Minn.: 1 in 333,333 chance each year. Old estimate: 1 in 714,286. Change in risk: 114 percent. | 333,333 | 3E-06 | 6666.66 | 0.02% |

97. La Salle 1, Marseilles, Ill.: 1 in 357,143 chance each year. Old estimate: 1 in 1,851,852. Change in risk: 419 percent. | 357,143 | 2.8E-06 | 7142.86 | 0.01% |

97. La Salle 2, Marseilles, Ill.: 1 in 357,143 chance each year. Old estimate: 1 in 1,851,852. Change in risk: 419 percent. | 357,143 | 2.8E-06 | 7142.86 | 0.01% |

97. Hope Creek 1, Hancocks Bridge, N.J.: 1 in 357,143 chance each year. Old estimate: 1 in 909,091. Change in risk: 155 percent. | 357,143 | 2.8E-06 | 7142.86 | 0.01% |

100. Clinton, Clinton, Ill.: 1 in 400,000 chance each year. Old estimate: 1 in 370,370. Change in risk: -7 percent. | 400,000 | 0.0000025 | 8000 | 0.01% |

101. Shearon Harris 1, New Hill, N.C.: 1 in 434,783 chance each year. Old estimate: 1 in 277,778. Change in risk: -36 percent. | 434,783 | 2.3E-06 | 8695.66 | 0.01% |

102. Hatch 1, Baxley, Ga.: 1 in 454,545 chance each year. Old estimate: 1 in 1,351,351. Change in risk: 197 percent. | 454,545 | 2.2E-06 | 9090.9 | 0.01% |

102. Hatch 2, Baxley, Ga.: 1 in 454,545 chance each year. Old estimate: 1 in 1,351,351. Change in risk: 197 percent. | 454,545 | 2.2E-06 | 9090.9 | 0.01% |

104. Callaway, Fulton, Mo.: 1 in 500,000 chance each year. Old estimate: N/A. Change in risk: N/A. | 500,000 | 0.000002 | 10000 | 0.01% |

www.msnbc.msn.com/id/42103936/ns/world_n.../ | 0.21% | 10.42% | ||

Spreadsheet risk Data: from NRC Geological nuclear risk.XLS

http://www.msnbc.msn.com/id/42103936/ns/world_news-asia-pacific/

http://www.aolnews.com/2011/03/18/would-fund-protect-us-taxpayers-from-nuke-disaster-here/

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