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Global Warming Examiner

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  • Why This Is The Most Hated Bull Market Of All Time - Understanding The Folly Of Financial Engineering [View article]
    You make the same argument that progressive liberal economists make; tax rates don't affect investment decisions! My belief is that high tax rates are retarding business investment, especially small companies that normally create the most jobs. Why invest in a risky business when you can easily get a higher tax free return in municipal bonds.

    The government raises tax rates, receives less revenue, and spends the increased tax revenue they never receive on government spending programs. This increases the deficit which is funded by printing money (debasement), which decreases the real purchasing power of the poor and middle class. Main street suffers while wealthy investors benefit from low interest rates by getting short dollars. (Most people buying stock are short dollars because the companies they own are funded partially with borrowed money. Warren Buffet is carrying about 50% debt through his corporate structure as his company uses borrowed money to buy companies that also borrow money. And he is rated AAA.)

    This is not going to stop until the government implements something like the Bowles-Simpson amendment that lowers tax rates, eliminates exemptions, and increases government revenue to fund social programs. Our current president won't cut tax rates because it is not FAIR! My question is fair to whom? His Wall Street Hedge Fund supports who are minting money?

    (I am long the market, mostly a diverse mix of dividend paying stocks that have significant but not excessive debt in their capitalization).
    Jul 24 04:29 PM | 5 Likes Like |Link to Comment
  • An Overview Of The Global LNG Market And Future Outlook [View article]
    A large increase in exports of natural gas should be a big boost to the natural gas pipeline companies that transport the gas from the gas fields to the liquefaction point.
    Apr 25 06:39 PM | 1 Like Like |Link to Comment
  • Nat Gas Transportation: China Is Trouncing The U.S. At Its Own Game [View article]
    Nice Article.

    Obama and Reid have suppressed the Natural Gas Act which would have provided incentives to build both natural gas filling stations and natural gas vehicles to jump start the market. That was 5 years ago. Another example of the President voting 'present'.

    The use of natural gas for transportation has grown slowly and I expect the economics, especially in trucking, to reach a point where the use of natural gas increases rapidly without government incentives. We are very close to that point now.

    The huge advantage of lower costs will help the entire economy. The US will import less crude oil and the export of diesel fuel will increase as less will be consumed in this country. This is OPEC's worst nightmare about to come true.

    The desire for higher fossil fuel prices to discourage consumption is misguided. Higher prices increase production world-wide. We should be trying to lower the price by fuel substitution with renewable energy and improved efficiency. Lower prices mean less fossil fuel will be produced. You could say that higher prices lead to the technical development of horizontal drilling and fracking, which has greatly increase the amount of oil and gas that can be developed at the right price.
    Sep 4 12:35 PM | Likes Like |Link to Comment
  • Mobile LNG Delivery Fueling Chart Industries' Growth In China [View article]
    This is great for China. They import liquified natural gas (LNG) and don't have a domestic pipeline system to distribute it. Putting it in a truck as a liquid beats the alternative of shipping it in high pressure vessels as a gas.

    In the United States we don't import a lot of LNG. Our gas comes straight from the well as a gas and we have the advantage of a huge system of pipelines to very efficiently distribute the gas. It is expensive to chill natural gas to a liquid which creates an additional financial burden. I would expect LNG to be a smaller business in the United States compared to China and many other less developed countries that will import LNG and haven't developed pipeline networks.
    Aug 15 12:14 AM | 2 Likes Like |Link to Comment
  • Natural Gas And Coal Economics Bode Well For Gas To Liquids And Coal To Liquids [View article]
    The problem with coal to liquid or natural gas to liquid is that it is very carbon inefficient. Coal plants are being shut because of they release more carbon into the atmosphere than natural gas for the same amount of electricity; at least twice as much. Coal to anything else is going to have a carbon problem.
    Jul 23 06:03 PM | Likes Like |Link to Comment
  • QE: There's A Problem With The Transmission [View article]
    The Federal deficit pulls resources from the private economy. In addition, high tax rates discourage investment. This causes unemployment, particularly for young people. Yet the government wants to increase the deficit to fund more young people going to college and raise taxes to pay for it. I agree - unbelievably stupid policy.
    Jul 3 01:27 PM | Likes Like |Link to Comment
  • QE: There's A Problem With The Transmission [View article]
    Very nice article. The real solution as you note is to have a better government fiscal policy that would encourage quality corporations and investors to borrow money to fund new business. Increased real loan demand would increase credit and allow interest rates to rise.

    They FED can't really do anything to increase real loan demand with interest rates already at zero. The real purpose of Quantitative Easing is to fund the government deficit so government debt creation doesn't raise interest rates and squeeze out the little demand for loans that currently exist.

    Why does no one talk about funding the government deficit with quantitative easing is actually a tax on the poor and middle class? It is high tax rates that are slowing our economy.

    The government deficit causes the monetary base to increase, which is causing inflation in things like food and fuel. The dollar will continue to buy less, squeezing consumers purchasing power while wages are flat. Other countries (Argentina, Venezuela) that are following similar money printing schemes are looking at currency devaluations which effectively reduce the standard of living in those countries. Fortunately for the United States, the dollar is a reserve currency so we export a lot of inflation to US bond holders, at least as long as the dollar remains a reserve currency.
    Jul 2 01:56 PM | 1 Like Like |Link to Comment
  • Tim Cook's Improbable Victory In Washington [View article]
    Apple simply told the truth and it made the tax system look terrible. It's the senators who could change the tax system that look bad. They should scrap the Corporate Tax and if they want more revenue, switch to a consumption tax.
    May 22 06:06 PM | 2 Likes Like |Link to Comment
  • For Plum Creek, A Strong First Quarter And Dividend Hike Are Driving Shares Higher [View article]
    Plum Creek is a tremendous asset play. They have been under-harvesting for years now and their timber assets 'grow' at a natural rate of 7% to 8% per year. As trees get older they get bigger and more valuable. They also have some higher value land that they sell periodically. Just looking at how much they have made in the past is not a good way to value the potential of this REIT.
    May 9 03:21 PM | Likes Like |Link to Comment
  • Investing In Disruptive Business Models: SolarCity And Better Energy [View article]
    I have a problem with this to consumer business model: the very high cost of sales. I worked with a solar energy company a long time ago when they were selling solar hot water systems. The cost of maintaining and paying a sales force is huge. Return for the purchaser is actually fairly small.

    I think a better model would be to build solar farms and then sell partnerships so homeowners can offset their energy bills. Investors could also purchase shares even if they lived in a rental. Solar systems installed in farms are much cheaper as you could do megawatts at a time instead of a couple of kilowatts. On a solar farm you can move the panels to track the sun producing more electricity. How much does it cost to install a single system on a home. What if the roof is not angled optimally for the sun - lower efficiency).
    Apr 24 06:00 PM | 1 Like Like |Link to Comment
  • Yes, Stealing Really Is That Bad [View article]
    Very nice article. Socialism will eventually fail when they run out of other people's money. Since they are now looking at stealing money from savers in Cyprus, European socialism is getting pretty close to running out of money. Where are they going to get the next fix for their stagnant economies so they can maintain their level of consumption?
    Mar 19 06:41 PM | 1 Like Like |Link to Comment
  • The Sequester - Why No Wall Street Panic? [View article]
    The sequester will reduce government stimulus but the effect on the economy is very much in debate. Economists who believe that all government stimulus will eventually generate enough economic growth to pay for itself have to take the position that the sequester will cripple the economy. Their views have been presented by the media over the last month. Obama talking about economic catastrophe for example.

    Economists who feel that government spending has a very limited amount of economic stimulus generally see the benefits as being greater than the small amount of fiscal constraint. After all, the federal deficit is still very high and thus stimulative. Interesting that Obama has been backpedaling after he failed to get the sequester changed. His economics just don't work but its the only economics he has to support the creation of a social welfare state.
    Mar 4 05:56 PM | 1 Like Like |Link to Comment
  • How the Fed Could Fix The Economy -- And Why It Hasn't [View article]
    Reserves are building up in the banks because banks aren't lending. They aren't lending because credit worthy investors aren't seeking loans. If the government fixed the tax code (Bowles-Simpson type reform) we might get new investment, credit expansion, and a growing economy.

    Anyone interested in starting a corporation in California? 35% federal corporate tax, 9% state corporate tax, 43% personal income tax, 13.9% state tax. I figure you are left with less than 25% of net profits after taxes. You have to earn a 20% per year net before taxes on the business from day 1 to beat the return on California Municipal Bonds.
    Feb 25 06:30 PM | 1 Like Like |Link to Comment
  • 20 Signs The U.S. Economy Is Heading For Big Trouble In The Months Ahead [View article]
    The price of oil and gasoline seem to be having a cyclic effect on the economy. In the Fall gasoline switches to winter blend which contains more butane. This is cheaper than summer blend which has to use more crude oil to replace the butane.

    In the fall gasoline prices fall due to winter blend and less driving. Lower gasoline prices raise the amount of money that can be spent on other consumer purchases.

    In the spring, refineries will start producing summer blend which is more expensive plus summer driving season increases demand. It is a little early, which makes the run-up in gasoline prices pretty scary. The debasement of the dollar could be driving higher prices as a form of taxation.

    Higher gasoline prices reduces other consumer purchases so we get a slowdown in the economy.

    The government could mediate this effect by building the Keystone XL pipeline, relaxing gasoline blending mandates, passing the Natural Gas Act. I don't expect Obama to do any of these things as he seems to think higher fuel prices are good for the country as that helps him promote his renewable fuels initiative.
    Feb 24 03:03 PM | Likes Like |Link to Comment
  • The Fall Of The Electric Car... And The Rise Of The NGV [View article]
    Obama has done everything he can to inhibit the use of all fossil fuels. The Natural Gas Act would have accelerated the adoption rate for natural gas for transportation, resulting in a significant reduction in carbon emissions. The Natural Gas Act has been buried in Harry Reid's desk and can't get passed in the Senate now going on 5 years. Instead the government is funding companies like Solyndra and Fisker that are either bankrupt or questionable as a going concern.

    A critical mass will eventually be reached in natural gas for transportation unless Obama can win another term and find a way to shut off natural gas production.
    Nov 5 01:31 PM | Likes Like |Link to Comment