Friday assorted links


"1. Since the election, ETF of clean energy stocks up 11%, ETF of coal-related stocks down 2% — oh, how some of you bore me!"

I wouldn't have expected the ETF of clean energy stocks to be effected by the election. The Phase out of the Production Tax Credit was established well before the election. As to Coal-related stocks, I'm a little surprised by that result.

Obama: "“So if somebody wants to build a coal power plant, they can. It’s just that it will bankrupt them because they are going to be charged a huge sum for all that greenhouse gas that’s being emitted.”"

Obviously, Trump's approach is vastly different.

' I’m a little surprised by that result.'

See below, but when you realize just how outdated most American coal plants are, and looking at the capital costs of replacing them, particularly in regards to the advantages of wind or natural gas, it is not a surprise that generating electricity with coal continues to decline in the U.S. It is just economics, after all.

I never understood the hand-wringing around that Obama quote. It's just a more colorful way of expressing the lessons from Econ 101.

Obama campaigned on TANSTAAFL energy policy.

Trump campaigned on free lunch energy policy. Trump promised he would restore thick high BTU coal seams to Appalachia by executive order.

Well first off, Tyler is misleading us because the graph only compares two individual ETFs - KOL and PBW. PBW has a lot of foreign shares - big in Canada and Mexico, largest holding is actually Plug Power which is into fuel cells and has been doing very well as of late. Not the typical ETF that is heavy on tax-subsidized operations, although they do have a good amount of Tesla. KOL's top holdings on the other hand include Aurizon (Australia), China Shenhua, and Teck Resources (Canada). Whatever this Bilello and Tyler think they are doing relating the performance of largely foreign shares to the Trump Administration is fundamentally silly. And boring.

And how about a year over year comparison? KOL's 61.25% 1 YR return looks a little better than PBW's 5.12%.
Marginal Revolution is not the place to get investing advice people.

China has been brutally stopping coal burning this year by industry.

I have several suppliers who lost sub-contractors who used coal for heat-treating products.

Massive crack downs in China on licencing, etc. for small factories.

"Obviously, Trump’s approach is vastly different."

Yeah, Trump promised to make coal a renewable resource so coal miners can return to mining thick Appalachia coal seams like in the 19th century.

All the increased coal production since Reagan came from killing coal jobs in Appalachia and replacing every ten jobs lost with 3 surface mine workers in the West producing inferior coal suitable only for steam. And so inferior, hauling it any distance costs too much, so I it's burned on site to generate power that must be sent hundreds of miles past land that can produce cheap wind and cheap natural gas to places that need power in excess of those power lines making costly solar cheap enough to beat high demand prices. Coal in the east has gone up in cost from either the more costly mining of scarce coal, or the more costly long haul rail, while alternatives have had costs stay flat or decline.

And coal regulations signed by HW Bush in 1990 are the costly pollution regulation that makes building coal plants go bankrupt, long before any carbon tax can force them into bankruptcy. Thanks! You radical leftist socialist big government Republican commie Herbert Walker Bush, you radical eviro-terrorist wacko!

"""39 tons per man-hour; North Antelope Rochelle; STRIP MINE; The most productive and efficient mine in the country. In 2015, it employed 1,418 people and produced 118 million tons of coal, more than 39 tons per man-hour.

7 tons per man-hour; Harvey Mine complex; UNDERGROUND MINE; 1,674 employees; 22.8 million tons"""

Nothing that hilltop haircuts in WV can't solve.

Almost all equities sectors are up yugely since the glorious November Elections.

Maybe clean energy stocks are up because retail investors believe President Trump will end huge subsidies on zephyrs and unicorn farts. Inquiring minds want to know why, if clean energy is so effing-fantastic, does it need yuge subsidies and tax credits?

Concomitantly, since the World's greatest gun salesman sneaked out of Washington, gun stock values are off.

Interested whether oil company stocks (e.g., ExxonMobil) are also comparably down. It could be both are correlated with declining oil and coal prices.

Why is 1 surprising? Modern wind turbines already can produce power per watt more cheaply than coal, and unlike in other countries, America's coal plants are using decades old technology and equipment which means their fuel costs are considerably higher than a modern Siemens coal plant. In other words, replacing a 1970s era coal plant is not cost effective, particularly when coupled when looking at the other major generation technology at this point. Natural gas is a considerably better investment for replacing a coal plant, as noted here in 2013 - 'More than half—51%—of the US’s electricity generating capacity was built before 1980. About 74% of all coal-fired power plants are at least 30 years old, and the average life of such plants is just 40 years, according to the National Association of Regulatory Utility Commissioners. Given US Environmental Protection Agency emissions regulations, it’s likely the coal plants will be replaced with natural gas when they’re mothballed. (This is positive for the environment: the EPA says a natural gas plant generates on average half the carbon emissions of a coal-fired power plant.)'

As further noted in that article - 'In fact, natural gas and wind account for nearly all power generation built in the past decade. Wind alone has provided for 37% of new electricity capacity since 2006, according to the EIA.'

Regardless of ideological viewpoint, in the end, the power generator that can deliver power at the lowest cost per kWh wins, though with the caveat that it must be done in reliable fashion (requiring a mix of technologies, which is exactly what we have today anyways). Wind continues to improve steadily, and the cost continues to decline as the effects of mass production, competition, and experience come into play. Which was as true in 2013 as it is today, actually.

Not even wrong.

To be fair, there are correct statements in that soup, but the overall gist of it completely misses the big picture.

Coal is used for base loading. Wind is not base loading. So, the two effect each other, but not directly.

"About 74% of all coal-fired power plants are at least 30 years old, and the average life of such plants is just 40 years, according to the National Association of Regulatory Utility Commissioners."

{facepalm} That's a tautology. Average life is not the same as Maximum life.

There's never a reason to "replace" a coal plant. Coal plants aren't particularly complicated designs. You retrofit the equipment as needed. The age of the physical building is irrelevant to how long a given plant is operational.

Person who has worked in coal plants in 5 states on emissions here:

Huh? Coal grade and plant design? Bag houses? Stack sprayers?
Dry scrubbers? Even stack height?

Huge designs tailored to the clean air standards of the day, or very expensively retrofitted.

'Coal is used for base loading.'

Well, sure, as is nuclear. Yet strangely, with an efficient enough grid and modern generators, it seems as if handling base loads looks like the sort of problem that the 20th century, pre-computer technology, found difficult. 21st century Germany, which is phasing out nuclear power, is not finding it all that difficult to handle as of 2017, particularly after gathering more than a decade of experience in predicting and managing loads and weather. And doing the engineering, of course - German companies are strange that way, they actually do more than simply talk about how problems cannot be solved.

'Average life is not the same as Maximum life.'

Of course not - but the maximum life of a generator involves a point where expensive maintenance needs to be performed. And often times, we are talking about systems with laughable efficiency rates compared to what is currently being sold by a company like Siemens, which is very much reflected in the cost of fuel to generate a kWh. The average life of a 1968 Beetle might have been a decade or so, but just because a Beetle is running today does not mean that it is worth keeping running with a third engine rebuild instead of replacing it with a modern car with ABS, better MPG, and airbags, but which is lacking a steering wheel that won't cave in your chest, etc.

'There’s never a reason to “replace” a coal plant.'

Cost of fuel - really a critical point that seems to be ignored in these American discussions. The following info at illustrates this point - 'This 600 MW plant with a Babcock & Wilcox boiler in Arkansas had an average heat rate of 8,858 btu/kWh in 2013 which was 16 percent lower than the U.S. coal fleet average of 10,424 btu/kWh.' combined with the formula found at shows American coal powered plants have a laughable efficiency rate of around 33%. Just so you can see the math, I might note. In contrast, Siemens is selling coal plants like this - 'The 750-MW Lünen plant has a USC tower-type once-through boiler that burns low-sulfur hard coal delivered via canal. Main steam is produced at 28 MPa (4060 psi) and 600°C. The Siemens SST5-6000 steam turbine has one HP, one IP, and two LP cylinders. The plant uses Siemens’ advanced 3DV technology (three-dimensional design with variable reaction levels) for the HP and IP blades, which optimizes stage reaction and loading to achieve the highest efficiencies. Using USC technology, the Lünen plant has saved over one million tons of CO2 per year compared to the average German coal-fired power plant. In addition to supplying electricity, steam is extracted to heat water for district heating purposes. The plant has an electrical efficiency of nearly 46% (LHV basis) while meeting stringent German environmental requirements, making it the cleanest hard coal-fired power plant in Europe.

While Lünen is one of the most efficient coal-fired power plants in Europe, what makes it particularly notable is the ability of Unit 3 to ramp quickly, making it ideally suited to balance intermittent wind and solar loads. To remove the ramping constraint posed by heat transfer into thick-walled HP turbine components, an internal bypass cooling system allows a small amount of cooling steam to pass through radial bores between the HP casings. This system protects the casing surfaces so the wall thickness could be less than without the cooling steam. This design also effectively allows more rapid heat-up (and thus startup) of the turbine.' Do note that this coal plant is intended to function as 'base load' within a renewable energy mix, but not by constantly burning coal.

And as an extra note - that highlighted 'most efficient' American coal plant in 2014 has an efficiency of around 40%, using that EIA formula. Nobody would buy such a coal plant who actually cared about reducing fuel costs or future suitability in a changing energy mix, compared to what is available on the market right now. Which makes this statement from that first article tragically laughable - 'The top 5 most efficient coal plants had an average heat rate of 9,120 btu/kWh, which is 13 percent better than the U.S. average.' Plants with that sort of miserable efficiency are being mothballed (into a 'cold reserve') in Germany - who wants to waste so much money buying fuel?

The U.S. has been sleeping for a generation in any number of areas - modern electrical generation and grid technology most definitely among them.

Do you have all this material stored in docs; or do you from scratch write it for each comment?

Actually, a lot of this is common knowledge, at least for people interested in such things, would have been my answer. At least when it comes to areas like energy policy or health care.

But since so many people make so many ludicrous assertions in this comment section, it is always good to present sourced information, even knowing that regardless of how many times facts are used, most loyal MR commenters are able to ignore them. Though it is always good to check the latest figures - of course I looked for Aetna's own reporting of its own results.

Wikipedia always works as a link here, but is apparently just not good enough for many discerning loyal readers. So for the past few weeks, and with the occasionally filtered link, it has been easier to use other sources - for example, one would assume that most if not all of the American commenters here are familiar with the wealth of factual information to be found at the EIA detailing American figures in terms of energy production, imports, etc. Nothing like current data to support an argument, after all. The same applies to the Commonwealth Fund for health care comparisons. Admittedly, both sources do have the problem that they report facts, which tend to be independent of mood affiliation, and do not permit a Straussian reading.

Well let him bet on coal then. I hear there are some coal ETFs on sale!

JWatts, wind power has almost zero marginal cost and so is normally a price taker. Coal power can have have a low marginal cost but it is still significant and has the additional problem that it cannot easily cycle on and off. As a price taker, wind tends to lower the average wholesale price of electricity. As coal cannot switch off during periods of low prices to save on fuel costs, coal tends to be the existing generating source most affected by wind. This effect can result in no generating capacity operating in a baseload mode in a region.

2. Many years ago I was in county court waiting for my turn for whatever reason I was there and observed the trial of a contract dispute between a young black women and a pest control company. According to the pest control company, the company had treated a house for termites after the young woman, who was sitting on the front porch of the house when the company's representative went to the house to recommend treatment, had consented. The young woman testified that she was sitting on the front porch and did talk to the representative, who told the woman that the company was treating all the houses on the block for termites and that if her house wasn't treated, all the termites would end up at her house. The young woman testified that she was afraid all those termites would come swarming, so she consented. The judge then asked her why she didn't pay for the termite treatment if she had consented. "It's not my house" she responded. The judge ruled in favor of the young woman. Termites, life insurance, it's bait when phishing for phools.

What the hell are you talking about? I mean that sincerely, are you suggesting there's no value in life insurance? I take it your dumb ass doesn't have any dependents, so naturally you wouldn't see the need.

I wonder if this is because black people feel more obligated to buy products from their black friends and neighbors who need work. I.e. Local black man gets a job as an insurance salesman - let's all support him by buying life insurance.

I have seen this a bit with white friends - like the way that girl scouts make you feel obliged to purchase cookies, because they're fucking girl scouts and it would be mean not to. But really, it makes everyone poorer to be coerced into buying things they don't need to "support" others.

There should be a whole study of "social obligation markets", or something to that effect. How much economic activity is generated by people feeling socially obligated to make a purchase from acquaintances or relatives, and how much misallocation/inefficiency results.

#2. After controlling for WHAT other factors? Murder/Mayhem rate in black communities? lower educational attainment? Inferior secondary schooling? Absent fathers? Article is behind a paywall. Useless.

Here you go:

Academic paywalls are infuriating. We pay for most of those universities with our tax dollars, and then they want to charge us again to see the output.

No money goes to the universities. It's harvested by good old private enterprise (in this case Taylor & Francis, a division of Informa plc) whose business plan is similar to big pharma-- take the academic output, privatize it, and charge whatever the market will bear.

Sci Hub

Socialist ;-)

I'm here for the race war.

2 - Come now, doesn't loyal reader B. Reynolds of comment 65 in deserve a bit of a mention?

Not unless you have an answer for it.


Well he said low income people, not black people. Which is a distinction that is presumably taken care of by "controlling for other factors."

#5 The asset-liability mismatch in China is astounding, people just do not understand how colossal it is an it stands at around 10-12% gap. Debt is never debt until it becomes "real" and if that ever happens in China (or the US for that matter) god help us all.

1. The overall market is up about 11%, so nothing special is going on with clean energy.

I am pretty sure "the coal industry" 's problems since the election have been because of metallurgical coal rather than thermal. See also iron ore prices.

"The overall market is up about 11%, so nothing special is going on with clean energy."
Which is kinda of the point, particularly compared to coal.

2. For those not familiar with life insurance and predominantly black neighborhoods, everyone in the neighborhood knows the insurance man, who comes calling every month to collect life insurance premiums. Economists are accustomed to building their models around fantasy. They need to get out more.

"For those not familiar with life insurance and predominantly black neighborhoods, everyone in the neighborhood knows the insurance man, who comes calling every month to collect life insurance premiums. "

I'm pretty sure that model disappeared over 20 years ago.

Sorry you had to change jobs...

99% of policies have direct deductions from the policy holder's bank account. You'll talk about any subject without the requisite knowledge, eh?

4. Whole life? Ouch!

2. that is

2.Recently after a 20 year Term life policy was over , at age 64 finding the Renewals extremely expensive I explored Term Life policies again and found that some companies that offer it at younger ages don't offer Term Life at higher ages even with good health results.. One would think they could using actuarial calculations but Whole life makes more sense for them, it appears.

According to the Social Security Administration's life expectancy table, men can expect to live for about 18 more years at age 64 while women can expect to live for another 21 years. If the term of the policy is 20 years, it doesn't make much sense. I suppose there could be a market for (relatively expensive) five-year term life insurance to cover that person's final working years.

How come BookCourt Closed? And how come van leeuwan ice cream isn't? Call 718.701.1630 to ask why there are chains on the benches. Is there a rash of bench thefts?

Tyler's consistent use of equity markets as some sort of proof that criticisms X, Y and Z of Trump are all invalid is awe-inspiring in its combination of insipidity and ignorance.

I'm not sure if I should be surprised or not. This drives financial economists crazy though. The way economists pick and choose return series as evidence is usually wrong, but common. Tyler shouldn't make those mistakes though.

#2 "especially whole life insurance" is crucial.

#2 - life insurance is sold, not bought.

I was noting the number of black actors featured in those "guaranteed exceptance" life insurance commercials. Now I know why.

Small whole life policies are very, very expensive when you consider the amount of protection for the cost.

Also, nobody walks a weekly premium route anymore.

1. Barriers to entry in clean energy are low. It's not nuclear science. Solar panels are almost a commodity. Wind turbines less so because of their size, but not much different from sourcing diesel or gas generators. So I would hope clean energy stocks don't outperform the market over an extended time because that would probably mean something has gone wrong.

the tumblr hack came from molly gottshalk at

2) Life insurance isn't bought, its sold. With regard to poor, black people, probably by this company: Combined Insurance. It specialised in door-to-door sales in rural areas, especially to these people. Their modus operandi is the same, even in Australia:

It would be interesting to see the claims experience for a sample of these policies [fraudulent conveyance]

norman gottshalk, marmom distribution services, Robert morris university

Jenny Kuhla professor photography

Albertz Benda, founded by Thorston Albertz, Freie University, Berlin


March 28 one day change +17 DOW points. The market rebounds as Trump signs an order reversing Obama-era climate change regulations.


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