Hurrah for Dollar Stores

They may not have everything, but what they do have for $1 costs about $3 at the local food store (Mac's Market). They have crackers, cookies, condiments, shampoo, chocolate bars, dishwash, salami, frozen foods, disposable paint brushes, and tie wraps.

Buzz. Free Media for Ipad

Fox and Friends this morning is so charmed by the new Ipad. The had one on the show, raved about it, showed good video of the screen, showed the thing responding to finger touches. Ran for minutes.
Gotta hand it to Apple. A product so cool that a leading cable news channel gives them a free commercial. Not just a passing mention, but a close up and detailed look at the thing.
Steve Jobs is doing his best to get us out of Great Depression 2.0. The country needs more guys like Jobs.

Is nuclear power affordable?

Maybe. The plants are expensive, the last round of proposals and bids centered around $6 billion dollars to construct a nuclear plant. That's a lot of money. Such a plant would produce 1000 Megawatts of electricity.
If the plant was financed with 20 year bonds, bearing 6% interest, the yearly bond payment would be $480 million dollars. That's the payment to the bank every year to pay off the bonds. That's also a lot of money. Will the plant sell enough electricity to pay its mortgage?
Assume the plant runs at full load 24 hours a day, 365 days a year. Assume they get 8 cents a kilowatt hour for their juice. Then the plant makes $700 million and some change a year from sale of electricity. Subtract the $480 million mortgage payment and the owners have a yearly cash flow of $220 million to pay the workers, purchase fuel, keep the plant up, pay their taxes, pay off the lawsuits, and provide some profit.
If any of the assumptions (interest rate, electric rate, demand for all the plant's output all day long) change for the worse, the plant may start losing money. I hear in the Journal that banks are unenthusiastic about lending for nuclear plants for fear they may default on the loans. There has been demand for federal loan guarantees for nuclear construction.
One thing that would help is reducing the cost of the plant. A lot of that $6 billion goes for permits and review of the design and getting Nuclear Regulatory Commission (NRC) approval of the plant design. And fighting the greenie lawsuits. These costs could be reduced by coming up with a standard design to eliminate the NRC review costs. Plus legislation to reduce the grounds for greenie lawsuits.
Bottom line. Nuclear power ought to pay for itself, but the margin of profit could be wider than it is.

Wall St attempts to re open the Mortgaged Backed Security Casino

From the Wall St Journal, print version, Tuesday March 30, Page B1. "Securities Debate is All About Trust". Mortgage backed securities are paper IOU's issued by banks. The banks claim the IOU's are "backed" by home mortgages, implying that the buyer of the IOU is buying something as sound as a home mortgage. In 2007 the marks discovered that the mortgages "backing" their IOU's were in default. They wised up and few to no mortgaged backed securities have been sold since.
The banks obtained the mortgages used for "backing" by purchasing them from the likes of Country Wide (home of Angelo) and other mortgage dealers. The mortgage dealers started to give mortgages to anyone who walked (or was dragged) in the door. "Ninja, No Income,No Job or Assets" mortgages became common. The dealer's sold these fraudulent mortgages to the banks for real cash. The banks "backed" their IOU's and sold them to "investors" or in ordinary language, suckers. The vast number of Ninja mortgages caused the crash in housing prices that triggered off Great Depression II.
Currently, the Administration and Congress want to require banks playing the IOU game, tohold onto 5% of the IOU's created, skin in the game, to give a small incentive for the banks to deal honestly. The banks are whining that 5% is too much and will ruin the market.
What ought to be done is to prevent the sale and trading of mortgages at any level. Banks issuing mortgages retain 100% of the mortgage on their books. None of this wimpy 5% stuff. This way the loan officer granting the mortgage, the only individual who actually understands the risks, who has interviewed the borrowers, checked with their employer[s], and inspected the property, has some incentive to do it right. If the bank owns the mortgage for it's full life, then it will be diligent and grant mortgages only to those who will pay them back.
Decent home mortgages are very sound investments. The homeowners are strongly motivated to keep up on their payments. Assuming a proper evaluation of the property, the mortgage is secured by valuable real estate. "Safe as houses" is the old cliche. Ninja mortgages are a scam.
The mortgaged backed security business caused Great Depression II and we need regulations to prevent it from happening again. Nearly two years have gone by and nothing has been done, AND the things proposed to be done are too wimpy to do any good.

Judge reforms patent law

Story here. A New York federal judge has ruled that patents on genes are invalid. Up until now, discoverers of genes could patent the gene and deny other scientists or companies the right to use it. The genes in the suit are natually occurring human genes, not artificial ones. The judge ruled that naturally occuring genes are not patentable, because they are not invented or created, they are merely discovered.

Hallelujah. This might be the beginning of the end of ridiculous patents. This will be appealed of course, but there is a chance the Supremes will see the light when this gets up to them.

National vehicle of the People's Republic of Cambridge

The Volvo. The height of Cambridge coolness, a muddy 240 Volvo wagon, with about ten Cambridge parking permits in the rear window. In 1999 Ford bought Volvo for $6.4 billion. Today Ford announced the sale of Volvo to the Chinese for $1.8 billion.
Credit Ford's new CEO, Mulally, for having the smarts to recognize a loser and dump it. Taking a $4.6 billion dollar loss, was better than taking the day-to-day losses of operating Volvo.
And boos to previous Ford management for wasting so much money on a doomed acquisition. Volvo was loosing money when Ford bought them. They didn't have enough volume to get the cost of production down far enough to make money. The only way to lower Volvo's production cost is/was to use a lot of high volume Ford parts or, simply put the Volvo badge on a Ford.
Doing this kills the sales. Volvo buyers buy the car 'cause it isn't Detroit iron. They want to own something different. Once they find the Volvo is just a Ford with a new grill and a Volvo badge, they leave the showroom, in droves. Volvo was asking BMW money. Nobody is going pay BMW money for a gussied up Ford, they will buy a real BMW instead. This was obvious to everybody in the car business in 1999, but the old Ford management went right ahead and wasted $6.4 billion buying Volvo.
They had company. GM bought up a number of European loser mobiles and they still haven't sold any of them.

Electronic Medical Records follow up

Cato institute has concerns about the security of electronic medical records too.
Come to think of it, Uncle Sam can check your electronic medical record in disputed cases of disability.