another solar company bankrupt

[marks2065 0]

Did no one in the Obama administration even look into the financial abilities of these companies before giving them all the stimulous money?
http://finance.yahoo.com/news/solar-trust-seeks-bankruptcy-protection-161510918.html

[wayneflorida 0]

Chicago patronage.

[mnealtx 0]

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Did no one in the Obama administration even look into the financial abilities of these companies before giving them all the stimulous money?
http://finance.yahoo.com/news/solar-trust-seeks-bankruptcy-protection-161510918.html

Sure they did...they looked into the their financial ability to contribute to Obama's campaign.

Mike
I love you, Shannon and Jim.
POPS 9708 , SCR 14706

[lawrocket 3]

It's interesting to me to see the frequent results of government intrusion into markets. The government likes to create markets, shut down markets, stimulate markets, etc. Sometimes this is successful, as in defense contracting and the like. Other times it is not successful, such as in situations we see here.

The governmental policy seems to be to make it as easy as possible for alternative energy companies to get going and they STILL end up falling flat in the market. Why? Because the costs are extensive, the product is expensive, and when given a choice people will opt for a less expensive product.

Imagine, if you will, what happens when the government actually takes over the system. It doesn't matter how expensive the project becomes, it continues to be funded. Indeed, to make up for the difference, funding is increased.

I've written on here countless times about the four ways to spend money.
(1) Spend your money on yourself (most efficient because you buy what you want/need at the best price);
(2) Spend someone else's money on yourself (you buy what you want/need but don't care about the price - inefficient)
(3) Spend your money on someone else (you buy a person what you think they should want/need and at a low price (it's why Santa always gave me underwear in my stocking); and
(4) Spend someone else's money on someone else (most inefficient because you spend on what you think/hope/feel a person needs/wants and don't care about the price).

These green power company loan guarantees are an example of the fourth option. The loans were guaranteed because nobody out there would spend their own money on these companies. Investors did not see hope for returns on this and found that their money would disappear if these projects were funded. But then the government guaranteed them because the government isn't losing anything. It's other people's money. And the government put money where it feels people should put money, regardless of what the people want.

What stake did the people guaranteeing these loans have in guaranteeing them? None. It wasn't their money! The people who loaned the money DID due diligence and found that the odds of a successful return on investment were so low as to make the project unfeasible. No way they are parting with THEIR money. Solar Trust could ONLY get funding through people who spend other people's money on other people.

Welcome to the world of government finance. This is how government operates. Why perform due diligence?

My wife is hotter than your wife.

[rehmwa 2]

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And the government put money where it feels people should put money, regardless of what the people want.

yup - and the result is good intentions absolutely retarding the progress of the artifically favored technology because the motivation to find cost effective solutions is removed and practical invention to allow the technology to come to market is delayed or even destroyed.

You want to KILL a good idea? let the government decide to sponsor it.

Of course, the orange drink "TANG" being the clear exception to the rule.



Another corollary? Do you want to make education completely too expensive for the common man? Let the government pay for it in the attempt to 'make it affordable'. The injection of tax dollars will drive the price up until no one can afford it except the rich.

Subsidies - killing off good markets since time began

...
Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[charlie5 0]

Waiting for Obama to come out and blame this on the Republican controlled congress, just like he did for solyndra.

The feather butts bounce off ya like raindrops hitting a battle-star when they come in too fast...kinda funny to watch. - airtwardo

[marks2065 0]

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It's interesting to me to see the frequent results of government intrusion into markets. The government likes to create markets, shut down markets, stimulate markets, etc. Sometimes this is successful, as in defense contracting and the like. Other times it is not successful, such as in situations we see here.

The governmental policy seems to be to make it as easy as possible for alternative energy companies to get going and they STILL end up falling flat in the market. Why? Because the costs are extensive, the product is expensive, and when given a choice people will opt for a less expensive product.

Imagine, if you will, what happens when the government actually takes over the system. It doesn't matter how expensive the project becomes, it continues to be funded. Indeed, to make up for the difference, funding is increased.

I've written on here countless times about the four ways to spend money.
(1) Spend your money on yourself (most efficient because you buy what you want/need at the best price);
(2) Spend someone else's money on yourself (you buy what you want/need but don't care about the price - inefficient)
(3) Spend your money on someone else (you buy a person what you think they should want/need and at a low price (it's why Santa always gave me underwear in my stocking); and
(4) Spend someone else's money on someone else (most inefficient because you spend on what you think/hope/feel a person needs/wants and don't care about the price).

These green power company loan guarantees are an example of the fourth option. The loans were guaranteed because nobody out there would spend their own money on these companies. Investors did not see hope for returns on this and found that their money would disappear if these projects were funded. But then the government guaranteed them because the government isn't losing anything. It's other people's money. And the government put money where it feels people should put money, regardless of what the people want.

What stake did the people guaranteeing these loans have in guaranteeing them? None. It wasn't their money! The people who loaned the money DID due diligence and found that the odds of a successful return on investment were so low as to make the project unfeasible. No way they are parting with THEIR money. Solar Trust could ONLY get funding through people who spend other people's money on other people.

Welcome to the world of government finance. This is how government operates. Why perform due diligence?

Why don't we hold these people responsible for not performing due diligence. Also why not make those repay the money they got in salary towards the loan.

[marks2065 0]

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Did no one in the Obama administration even look into the financial abilities of these companies before giving them all the stimulous money?
http://finance.yahoo.com/news/solar-trust-seeks-bankruptcy-protection-161510918.html

Sure they did...they looked into the their financial ability to contribute to Obama's campaign.

maybe any political donations paid to anyone running for public office should be repaid towards the bankrupcy.

[lawrocket 3]

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Why don't we hold these people responsible for not performing due diligence. Also why not make those repay the money they got in salary towards the loan.

What? Come on, now. When Solar Trust broke ground a mere nine months ago on its new solar generation site near Blythe it had Interior Secretary Ken Salazar and California's own Governor Jerry "Moonbeams" Brown there with the CEO. I have no proof that there was some grease involved, but things seem rather slippery.

But note that Governor Brown's senior advisor on renewable energy facilities doesn't see this as any more than a short-term nuisance and is optimistic about the comeback chances for the Blythe project, noting that financial reversals are the norm for large-scale projects. Said this advisor, Michael Ricker:

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It's got the land mass for something as big as 1,000 megawatts; it's got transmission; it's got permits; and I bet there's some market for it...I would not be surprised to see a couple bidders show up and get under way pretty soon.

Yep. He'll bet, all right. With whose money?

My wife is hotter than your wife.

[Gravitymaster 0]

Here's what is possible when private industry takes a whack at it.

http://www.forbiddenknowledgetv.com/videos/alternative-energy/clean-energy-too-good-to-be-true.html

[dks13827 3]

Elon Musk from Space X and pay pal says this stuff is great !!! ( Solyndra ! ) He also says he can go to Mars for 500K !!! He also says he can launch a rocket and then bring the booster back to the pad like a slow motion reverse video ! Yeah right.

[SkyChimp 0]

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Why don't we hold these people responsible for not performing due diligence. Also why not make those repay the money they got in salary towards the loan.

Remember this when you vote this election in 2012

Does anyone else find it funny that we made a SPORT out of an EMERGENCY PROCEDURE?!?!

[marks2065 0]

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Why don't we hold these people responsible for not performing due diligence. Also why not make those repay the money they got in salary towards the loan.

Remember this when you vote this election in 2012

yes I will remember when I vote, I have the ability to make choices that many others don't. All those projects the left wants and many on the right want also, can not happen if we are bankrupt.

[shropshire 0]

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Why don't we hold these people responsible for not performing due diligence. Also why not make those repay the money they got in salary towards the loan.

Remember this when you vote this election in 2012

How will that change anything fundamentally? Just a different bunch of crooks with a different set of agendas (unlikely to be yours either)......BTW it's no different in our country either

(.)Y(.)
Chivalry is not dead; it only sleeps for want of work to do. - Jerome K Jerome

[SkyDekker 1,465]

I wonder what percentage solar subsidies are of oil subsidies?

[rehmwa 2]

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I wonder what percentage solar subsidies are of oil subsidies?

scaled to the industry size of course, I'd suspect the solar companies are getting a much bigger proportionate share - scale it to actual output - I suspect it even more

but I have no reference for that

...
Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[SkyDekker 1,465]

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scaled to the industry size of course,

Or scaled to profitability maybe makes more sense.

Trying to stimulate a new market may make a bit more sense than stimulating an incredibly profitable market?

[rehmwa 2]

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scaled to the industry size of course,

Or scaled to profitability maybe makes more sense.

Trying to stimulate a new market may make a bit more sense than stimulating an incredibly profitable market?

I don't think the margins in oil are incredibly profitable - just the volumes make it feasible. But I don't see any need to give them breaks that any other industry wouldn't get. And this specific industry, I believe government taxes make more money per gallon of oil than the companies do in profit.

Stimulating a new market drives prices up and slows down the need to make the product truly affordable. Why invent a $500 solar panel when Billvon can buy a $5000 solar panel for $10,000 (using his $5000 and then getting an additional $5000 that the government stole from his neighbor for that purpose - thus jacking up the price past its value.)


(FWIW - I'm a big fan of deleting all stimulants and all penalties from all the markets. Let the free market work. So I'm not a fan of stimulating either sector.)

...
Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[lawrocket 3]

Oil gets subsidies. I am in favor of eliminating those subsidies. I think the subsidies mainly come from tax breaks - these tax breaks having been around for about 90 years now.

I think, however, that decrying oil company profits is dickishness, consider that governments profit more off of every gallon of gasoline sold than the oil companies do. Look up the taxes.

In California, here are the various taxes on gasoline:
(1) Underground Tank Storage Maintenance Tax - $.02
(2) Fuel tax - $.357
(3) State and Local Sales Tax $.1
(4) Federal Excise Tax - $.18

Yep - governments profit by $6.57 for every ten gallons sold in California.
What about the oil companies?
(1) Crude oil cost $2.91 per gallon.
(2) Refinery costs and profit - $.43.
(3) Distribution Cost, Marketing costs and profits - $.32

Out of the $4.32 price per gallon of gasoline in Cali, the oil companies add margin of $.75 for every gallon of costs and profits. The companies might profit a maximum of 30 cents per gallon (I'd suspect closer to 10 cents).

The government profits more off of a gallon of gasoline than the oil companies do.

My wife is hotter than your wife.

[SkyDekker 1,465]

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Oil gets subsidies. I am in favor of eliminating those subsidies. I think the subsidies mainly come from tax breaks - these tax breaks having been around for about 90 years now.

Oil also gets a protected market and a defended and protected supply.

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I think, however, that decrying oil company profits is dickishness,

I agree, they have played their cards very well.

[mnealtx 0]

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I don't think the margins in oil are incredibly profitable - just the volumes make it feasible. But I don't see any need to give them breaks that any other industry wouldn't get. And this specific industry, I believe government taxes make more money per gallon of oil than the companies do in profit.

Oh, government is absolutely making more off a gallon of gas than the gas companies are. According to the American Petroleum Institute, average gas taxes are 48 cents per gallon (federal state and local), and here's a blog post from Exxon stating that their profit on a gallon of gas was a little over 2 cents.

Mike
I love you, Shannon and Jim.
POPS 9708 , SCR 14706

[rehmwa 2]

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Oh, government is absolutely making more off a gallon of gas than the gas companies are. According to the American Petroleum Institute, average gas taxes are 48 cents per gallon (federal state and local), and here's a blog post from Exxon stating that their profit on a gallon of gas was a little over 2 cents.

Isn't it strange, based on this, I'd think that lefties would absolutely LOVE the petroleum industry an example of how they want the gov to treat all industries

...
Driving is a one dimensional activity - a monkey can do it - being proud of your driving abilities is like being proud of being able to put on pants

[weekender 0]

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Oil gets subsidies. I am in favor of eliminating those subsidies. I think the subsidies mainly come from tax breaks - these tax breaks having been around for about 90 years now.

Oil also gets a protected market and a defended and protected supply.

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I think, however, that decrying oil company profits is dickishness,

I agree, they have played their cards very well.

perhaps i am reading your response too literally but i do not understand it.

how is oil a protected market? it trades 24/7 in every market world wide. it is arguably the most liquid, fungible commodity in the world.

how is their supply protected? If it can be purchased anywhere at anytime by anybody. it would seem to me its not a very guarded supply.

"The point is, I'm weird, but I never felt weird."
John Frusciante

[DanG 1]

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how is their supply protected? If it can be purchased anywhere at anytime by anybody. it would seem to me its not a very guarded supply.

Not sure it's what SkyDekker meant, but their supply is protected by the largest, most powerful, and most expensive military the world has ever seen.

- Dan G

[mnealtx 0]

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how is their supply protected? If it can be purchased anywhere at anytime by anybody. it would seem to me its not a very guarded supply.

Not sure it's what SkyDekker meant, but their supply is protected by the largest, most powerful, and most expensive military the world has ever seen.

That's odd - I don't recall hearing about any American troops stationed along the Russian, Chinese or Turkish pipelines.

Mike
I love you, Shannon and Jim.
POPS 9708 , SCR 14706