Foolish posters look to solve the UK's economic woes, and run the numbers on energy investing.
The illusion of wealth
There still seems to be a significant problem with small businesses getting access to the loans they need to finance their growth. So what's the solution?
The coalition appears to think they have the answer -- printing money to give to banks, to encourage them to lend. But as blackwhite commented on Bert's Investor Sanctuary, it didn't seem to work so well before:
"Let's print more money and lend it out so more of it can sit under our collective bottoms in properties, giving us more of an illusion of wealth and of course some token small-business lending.
"That's it, now why didn't Labour think of it all those years when they were in power?"
But is it even the banks' fault? IsleofWightPete thinks not -- it's the type of businesses that are after money that's the problem:
""Most middle of the road businesses seem to be paying down debt, reducing inventories, cost cutting, but NOT looking to borrow or invest.
"The ones moaning they can't get banks to lend seem to be the ones that are deeply loss-making, who have no business plan to change anything, but desperately want the banks to extend their overdraft (again) so they can pay wages for a few more months while they pray the world will change and business will magically pick up.
"I don't think banks SHOULD be encouraged to lend to that group. It just keeps these zombie businesses going for a little while longer, whereas they should be allowed to fail so that other businesses can pick up their customers and make some profit out of them."
So what is the solution? KingMcKong offers the example of his brother's successful printing company
"In the short term action by the banks, including the Bank of England, may provide a bit of stimulation, but it won't solve the long-term problem.
"We have to re-establish our ambition for wealth. That means a great environment, a passion for low cost decent housing for all, sustainable food production, service to our fellow humans, honesty in trading and financial services and sufficient wealth for everyone to enjoy long and comfortable retirement, in other words high quality pensions.
"We're just puddling around at the bottom of the barrel right now. This is not the Britain we can and should be. We need a sea change in our attitude towards true, sustainable wealth creation."
Investing in energy
One of the attractions of renewable energy sources like solar, wind and water power is that they're, well, free. The sun shines, the wind blows and water flows, so tapping them as a resource seems like a no-brainer. Of course, there are costs associated with doing so -- building a wind-farm in the sea is a big undertaking -- which may drive the initial price sky-high. But even if the power generated costs a lot more, at least it's not coming from finite fossil fuels, and it's an investment in everyone's future.
And maybe power from renewables doesn't even have to cost that much more to begin with. On the Oil & Gas - Markets & Trends board, loglorry was puzzling about the numbers:
"I've just seen on Channel Four news that offshore wind is about £160/mwh to produce vs gas at about £75/mwh and onshore at about £88/mwh.
"I can't recall the exact numbers.
"This just seems very wrong to me. Are they just talking about operating costs or something because I'm surprised wind is so cheap compared to gas. I have a feeling this is just the TV getting it wrong again.
So are those numbers wrong? Hallucigenia thinks not:
"They look about right. Possibly a bit high in all cases -- I know developers who are looking at closer to £70 than £80/MWh for new-build onshore wind. The current government target is for offshore wind to be £100/MWh by 2020, and one of the biggest offshore developers, SSE, reckon that's credible (eg per their recent results statement). "
And, of course:
"... one of the big attractions of low/no fuel production is that you pretty much lock in your cost of production for the life of the asset. So even if it seems a bit pricey up front, in the event of serious inflation it's like the people who paid ridiculously high prices for houses in Chelsea in the early 1970s - as much as £50k or whatever for a house that's now worth a million. "
If you're an 'energy investor', and curious about whether renewables may affect your existing investments, or offer new opportunities, you may well want to take a look at the rest of the thread.
Anger management
Sometimes, people can get a bit 'heated' on our discussion boards, and being angry is rarely a good position to argue from. But zoomydo has a suggestion for that.
Last week's round-up: Three Small-Cap Ideas
