Yes and No!

GM plans a new strategy, providing a fuel source for its better technology, and actually consists of a wonderful addendum to my previous blog. They have an engine which can utilize 85% ethanol, but no fuel for it; most other engines utilize only 15% ethanol. Fuel consumption type grants them an technological advantage, and they are looking for a similar advantage in the fuel. Animal waste is the desired platform, as it consumes less energy, less water, and puts less Carbon into the atmosphere. The later is important because We must subsist with the amount of surface Carbon, though We don’t have to choke from spreading underground Carbon deposits. The interesting thing are this method lies in that the bacteria method of producing ethanol could enrich the actual fertilizer quotient of the residue. The real Bottom Line will be that its production can actually be made competitive with Gasoline production.

James Hamilton gives Us a Piece representing how the Fed is likely to react, though I regret the likely Fed reaction. The Federal Reserve has altered policy over the years, but the current trend bothers me. It has become a Welfare system for the economic plungers of the World, with the provision of a kind of safety net through ready, easy Cash. I remember the hysteria assumed by the thought of deflation some years past. Now there is hysteria about a Cash shortage to cover overextended Banks. Why has the entirety of rugged Individualist marketeers abandoned the effective tool of Self-Correction–the natural Market solution?

Here is one of the factors leading to the current Credit Crisis, but reminiscent of the old Shame on You–Shame on Me story, the fault is basically with the Banking system. Bank officers have become too dependent on production bonuses to do their jobs. The rapidity of pace of loan extension is a poor vehicle to reward. Bank practice is at fault for the greatest majority of their troubles, and Fed underwriting of easy Credit will not bring quick change to negligent Banking practice. The Fed may be attempting the creation of the next Banking failure, but We should not applaud the effort. lgl