Booms, Busts, and Recoveries Message Board

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Strategies & Market Trends : Booms, Busts, and Recoveries

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To: energyplay who wrote (54925)	10/26/2004 6:59:45 PM
From: Snowshoe	Read Replies (1) of 74559

>>Got to hand it to the Europeans<< Actually, the U.S. proposed the carbon-credit marketplace. We're the home of free market, supply side economics you know! But then Bush backed out of the deal, so Europe is stuck with it. Given all the distortions it causes, I'm sure there will be a series of "adjustments". And probably something akin to the Federal Reserve Board, run by a Eurocrat located in Brussels. With a governing board that sets annual atmospheric carbon percentage targets. With regular monthly reports that will have energy futures traders around the world poised at their terminals, waiting to unleash buy/sell orders based on the latest statistics. To meet the targets in an orderly fashion, I envision this board stepping into the market to buy or sell carbon credits. Just the way the Fed adjusts interest rates to control inflation. Big quarterly increase in atmospheric carbon? Wham! The board sucks up carbon credits, and it artificially gets more expensive to burn coal. So utilities switch more production from coal to gas. But wait a minute! Tommasso up in Alberta is burning huge amounts of gas to cook his tar sands. Because of the increased demand for gas, his costs just went up 10% so he has to cut the dividend payout on his Can-Roy. That's not all! Down in Illinois Ish can no longer afford the carbon credits to burn the coal to evaporate the water from his latest batch of corn ethanol. You can see where this is going... -Snow

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