There happen to be some very good reads today at two widely-read blogs.
At Naked Capitalism, Yves Smith comments on the possibility that there may be some hope for a relative shrinkage of the role of finance in the workings of the advanced economies; click here for the post.
Mish has a complex writeup with a number of links to his and other material with the theme and title of Creative Destruction.
Back at Naked Capitalism, Yves linked to a WSJ article I brought to her attention, click here for NC's links today; eighth link from the top. Because this is a subscription only WSJ article, I'd like to add a link to a more thorough abstraction from this, as published at the Planet Gore blog:
The Looming Biofuel Bust
The biofuels revolution that promised to reduce America's dependence on foreign oil is fizzling out.
Two-thirds of U.S. biodiesel production capacity now sits unused, reports the National Biodiesel Board. Biodiesel, a crucial part of government efforts to develop alternative fuels for trucks and factories, has been hit hard by the recession and falling oil prices.
The global credit crisis, a glut of capacity, lower oil prices and delayed government rules changes on fuel mixes are threatening the viability of two of the three main biofuel sectors — biodiesel and next-generation fuels derived from feedstocks other than food. . .
Producers and investors now are pushing for swift and aggressive government help. Biodiesel makers are lobbying to kick-start the delayed blending mandates immediately and extend biodiesel tax credits, which expire in December.
On Aug. 7 more than two dozen U.S. senators wrote to President Barack Obama to warn that "numerous bankruptcies loom" in the biodiesel sector. "If this situation is not addressed immediately, the domestic biodiesel industry expects to lose 29,000 jobs in 2009 alone," the senators wrote, using estimates by the National Biodiesel Board.
Mr. Obama, who supported biofuels throughout his campaign, is working to roll out grants and loan guarantees for bio-refineries and green fuel projects, said Heather Zichal, a White House energy adviser. The pace of the disbursements should speed up this fall, administration officials say.
I have not followed the biofuels stuff much at all, but with oil around $70 barrel, the idea that oil prices are so far below projections that this stuff is now uneconomic is loony. One wonders if this was just another corporate scam.
It's one thing when one group of people gain an advantage over another in the process of developing useful goods, services, capital investment and the like. From an overall standpoint, spending real resources to build irrelevant things is pure waste. In the Bible, the seven lean years probably came from locusts and weather problems. Nowadays it's more likely government-caused problems or too much in the way of "animal spirits" amongst businesspeople.
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