THE EDSEL FACTOR

The most obvious can sometimes
be completely overlooked. There
are hard facts that support the
fact that Lithium will become
unavailable for the production
of Lithium Ion batteries for the
EV's and Hybrid's of the future or
the present

The folly of dependance on LIthium
ion batteries for a power storage
source or as a bridge technology
until a more enduring technology
is developed is not a secret.
Until Fuel cell Batteries are in
production or an alternate source
is developed the EV market may
collapse.

This adds fuel to the theory that a
giant auto maker may face another
crisis. This mega auto producer
may be marching towards it's
decline as a world market leader.

There are great reserves of the heavy
metal Lithium in sea water but the
enormous cost of extracting it is
off the charts. There is no evidence
that this reserve will ever be utilized.

There is even less evidence that
the existing Lithium mines in
South America can deliver the goods
in less than 20 years. The reserves are
there but the infrastructure is not.
There is a complete absence of an
infrastructure central to these mines
and the political climate is less than
friendly for foreign capital.
Follow this link wtahil@meridian-int-res-com.
to get some facts from Meridian International
Research from a well researched paper
on Lithium reserves. This fact filled article
is worth reading if you are planing to buy
an EV in the future. My advice would be to
wait about 20 years unless you have an
excess of expendable income.

THE PAPER BY MR.WILLAM TAHILL
AT MERIDIAN INTERNATIONAL RESEARCH
IS SEEMINGLY A FRANK REPORT ON
THE AVAILABILITY NOW AND
IN THE FUTURE FOR LITHIUM. BELIEVABLE
OR NOT IT IS A FACT FILLED REPORT THAT
EVERYONE SHOULD CONSIDER READING.

THE TROUBLE WITH LITHIUM
Implications of Future PHEV for Lithium Demand

FROM MERIDIAN INTERNATIONAL RESEARCH
BY William

wtahil@meridian-int-res-com.

The "Prius Edsel factor" part one

Prius is planing a switch from Nicad

battery to the highly touted lithium ion

battery. This will likely give the Prius a

place in auto history as infamous as the

Ford Edsel. The ion battery will disappear

from the market in less than 15 years.

Lithium mines are already having trouble

keeping up with the cell phone and laptop

computer demand. There will be zero

reserves of lithium within 12 to 15 years.

Hybrids will need to find an option to the

lithium ion battery.

Switching to the Ion battery will put the

Prius in a class of its own. The process

of adapting your Prius to an battery

powered ion plug in will cost you around

$12000.00 minus a tax break of an estimated

$4000.00 Not an economical option.

The battery problem might just price the

Prius out of the market for working stiffs

who make less than $200,000.00 a year.

Most of the over 10,000. prius owners will

need to replace their nicad batteries in

about 8 years. Presently he cost is around

$3000.00. The projected cost in 8 years

will likely exceed $6000.00 but supply will

be nill. They will need to find another

option to keep their Toyota humming along

at lightning speeds.

The Chinese are eating nickel

as if it were rice. Nickel is used to

produce stainless steel and China leads

in export and domestic production of

stainless steel. The cost of nickel is

expected to make a 500% cost leap in

less than 5 years. Reserves of nickel in

the world market are dangerously low.

Nicad batteries are already priced out

of the market. That eliminates the nicad

and switching to Ion batteries will result

in a bigger hit to Toyota than any of the

damaging recalls presently undermining

faith in the reliability of all Toyotas. The

option for a change to Ion batteries for

Hybirds to ion plug ins is like selling snake

oil to cure diabetics. Cost factors will not

be a problem but supply will. The raw

material, lithium, will not be available

since there are no producing

mines. Estimates are that it would take

at least ten years to develop the

infrastructure to allow production in

the two existing mines in South America.

Presently the worlds production ,which

is dwindling to nothing, is used to make

the wonderful exploding ion batteries

used in notebooks and cell phones.

You might recall the press bites on

flaming notebooks, Ion batteries are

prone to overheating a fault that is far

worse than "sudden acceleration".

Look for press bites in the future on

flaming or exploding Priuses. There

will be an acute shortage of Ion batteries

and the cost will be porhibitive for most

Prius owners other than Steve Jobs or

Bill Gates who both drive a Prius on

ocassion.

Again Toyota moves toward another

drop in sales when the Public realizes

that the Prius will be virtually obsolete

in less than ten years. Sooner if you were

a"pioneer" and need to change your

batteries sooner.

The annual sales volume of the Prius is

now exceeding 100,000 units. Which

proves that the gullible world market will

buy snake oil if you beat a drum hard

enough and package your product

attractively. Again "the Edsel Factor".

Consumers are simply uniformed by the

lack of truth and blinded by media hype.

Are there other options for this disaster

that are practical? The simple answer is

no. The only future option that might be

practical are fuel cells but development

of this clean technology will take at least

another 10 years. Production will probably

take another 5 years to commence. This

will allow time for the public to become

thourougly disillusioned with electric

power by any means. The Japanese

auto industry may be facing the same fate

experienced by the auto industry in the United

States, Death from arrogance, greed and

poor management. Even giants like Godzilla

can be reduced to ashes when they step into

a volcanic crater. Possibly there might be a

miraculous recovery of the auto industry in

the U.S. Henry Ford would be proud.

Look for part two in this blog "The Lithum

dictum".

SARAH PALIN TAKES A WALK

The media buzz is hurting my ears. The noise about Palin'a shrill resignation as Alaska's lame duck governor comes as no surprise. This makes one wonder what other issues truly out weigh this media event. The world seems to now host politicians and personalities who like clowns in a circus , well clown around, and take a back seat to the real lion tamers who are the Banks and Corporations who represent the real time acts. Often I feel that this three ring circus is truly three rings of activity operating as separate entities. In Ring one we have the media who now have less control mostly because of a real hosing down by the internet. This dilution of power probably leaves the public confused. In Ring two we have the politicians and so called World leaders and the other people who sweep up the resulting manure. They are performing independent of reality or at least it is difficult to tell reality from hopes and dreams and outright deceit. Ring three has the Banks, Financial institutions and corporations who collectively brought down the world economy and continue to reap outrageous profits while utilizing taxpayer money. These guys are the real evil lion tamers and stars of the Circus. However they would like to lie low and have unbridled freedom to continue fleecing the public with their own tax money. The world leaders/politicians dance around like puppets in ring two trying to put patches on the economy while feeding the lion tamers in ring three prime steaks in the form of support from the Feds. Unfortunately there is no Ringmaster. Perhaps one effective Ringmaster could bring the show to order. The world is a disorganized circus.

Diffused, confused power is the theme. Hopes for a new leader or Ringmaster fade. Obama held out some hope for "a world leader" but he is now diminishing his potency by involving himself in local racist leaning issues and moonwalking backwards like the late Michael Jackson. Shuffling one step forward and two back while secretly puffing on a cigarette and "rethinking" statements/actions to shore up the American Economy and therefore the world economy. Other leaders down south like Oscar Arias, who has trouble holding a tea party for Central American players, are the norm. Then there is the French Prime Minister who finally forced Europeans to draw a line on a politicians private moral behavior. Most "leaders" are clowns performing their usual act in ring two oblivious to what is going on in ring three and focused on the press in ring one. Where is the Nation or individual leader who can bring order? That is a depressing question. Some real potential world leaders have unfortunately aged beyond the energy level needed to lead us out of this chaos. They are also exhausted from dealing with their own national problems. Perhaps our readers can see a world leader emerging by looking in unlikely places like Africa or Latin America. America is leaning left but not by design. America simply lost it's balance and will "right" itself with the next presidential election. Republicans will probably take control again in spite of twitter or any other technology used by clever Democrat/technocrats. The resulting time lag that a change in administrations causes is hardly something America needs. Change will not solve the problems and change will not bring peace.

STEEL MOUNTAINS 09/01/2008

Steel Mountains 09/01/2008

The growing mountains of giant steel boxes observed while driving past mega ports in the western hemisphere is a reminder that the global economy is faltering. The mountains are made up of neatly stacked steel containers weighing almost two tons each and with dimensions of up to 10 x 40 feet, these steel mountains are experiencing exponential growth. Like giant multi colored lego blocks they some times reach a height of six stories. The increasing metric volume of these mountains of steel are a solid indicator of the failing health of Global trade. Containers flow from east to west hauling millions of tons of cargo between continents. As the economy slows the mountains grow at the final ports. You may have also noticed parking lots with shiny new cars that include economic mini cars to plush elegant gas guzzling sedans, these are not commuter parking lots but unsold autos grazing on valuable real estate near mega ports. Like homeless dogs they await adoption basking leisurely in some harsh environments. The orphan cars have been shipped on collapsable containers that require immediate unloading. The containers are then collapsed to a tenth of their loaded volume and sent back to the original port. A clever instant turnaround cycle that has become self defeating in the present economic climate. Normally the autos would be delivered to distributors within 48 hrs. Now the distributors must lease expensive space port-side to store them. The supply has overrun the demand and what will happen to a shiny new car after baking in the California sun or experiencing the brittle frigid Canadian winters for months or possibly years?

Container companies have struggled for years to develop a workable flow chart for a balance of ingoing and outgoing containers, Without even considering the recent rise in fuel cost, shipping an empty container back to it’s original destination had already exceeded the original cost of the container years ago. This is a classic “catch 22” problem and there is no short term solution. Like other pressing economic problems the common thread in this scenario is a universal lack of long term planning and an unbridled greed for larger profit margins.

The recent proposal and subsequent work on expanding the Panama Canal is probably ill timed but admittedly well thought out. The one factor that may defeat this scheme is the world’s consumers who have decided to cut spending drastically due to a global recession. Panama has stood by mostly untouched while the rest of Central America is feeling the full affect of a worldwide economic crisis. Plans for an expansion of the canal were optimistically based on a real time steadily increasing flow of traffic through the canal. Presently there is still a flow of ships through the canal but one must realize that traffic primarily flows from the East to west, the return traffic east is now fractional in comparison and the flow of goods from east is quickly diminishing, this Global economic crisis is so critical that a quick end to is unlikely. A jolting reduction in canal traffic is predictable.

The canal is a buffer for the Panamanian economy, on a recent trip to Panama City I noted that in less than six months it appears that there are almost twice the number of empty, stored containers. This is not unlike any other western port, it could be Los Angeles, Houston or Port Elizabeth, New Jersey. A drive form San Jose, Costa Rica to Panama City will give evidence to the low cost of buying used containers. Everything from fruit stands to restaurants are using them as an economical “quick build” solution. On the supply and demand side there is an inflow of containers and a diminishing demand for them by shippers.

The “exclusivity” of Panama’s economy in Central America is an accepted but somewhat mysterious fact. Most people have no clear idea of exactly how income from the canal makes it’s way into the infrastructure. Most say that it must, since Panama has one the most developed infrastructures in Central America and Panama City ranks high as an emerging mega city. Exports of agricultural and hard goods going east are fractional and the rumored profits from money laundering is more likely to trickle out of Panama than trickle down into the Panamanian economy. Those who laundry the clothes do not necessarily wear the clothes. It is a private industry.

What lies in the future? When there is a substantial decrease in the flow of canal traffic Panama will suffer a delayed economic hit, The present back up of container ships, cruise ships and tankers has delayed the full affect of the global crisis on Panama. However a substantial slowdown in shipping is a forgone conclusion, traffic will likely decrease drastically in the coming months and Panama will feel it. Combined with the enormous cost of the canal expansion and increases in operating expenses there are some dark clouds on the horizon. Will the Panamanian economy be able to absorb the cost of the Canal improvements when there is far less income from the canal? Will Panama suffer a recession like the one that exploded when the canal was returned in 1999? There is a strong probability that a serious recession will be a reality. The poorly planed pull out of all American troops virtually overnight caused a five year recession in Panama. A rapid and total pullout of the free spending troops left a huge hole in the economy of Panama that took years to recover from.

Will the United States be willing to rescue Panama if there is another economic disaster or will the US be forced by circumstances and self interest to look the other way? The diplomatic gains made by the return of the Panama canal can be lost as quickly as they were gained. All of Central America and most of South America holds the United States culpable for the failure of the global economy. Out of need and desperation it is likely that Panama might follow the trend in Latin America and drift towards the left.

Bush has practically nationalized the banking sector and Obama is working on the auto industry, together they have pushed the nation into a socialistic matrix. There is a danger that a policy of "propping up" the private sector will become long term or a permanent policy. This poses another question, Has the United States also inadvertently made a shift to the left and is gingerly sidestepping into a genuine “socialistic” bail out of the American economy