Comments on: Martin Ferguson is right.

By: Graham Young

Graham Young — Tue, 10 Jun 2008 09:21:05 +0000

She’s close and dear, but maybe we should run a betting market on it. I guess we’d need a URL in a country where you don’t need a licence to be a bookie. Then she might have a chance of winning her money back, and we’d both have another subject to blog on. (I’m assuming that oil futures markets don’t go out that far.)

By: Andrew Leigh

Andrew Leigh — Tue, 10 Jun 2008 09:10:22 +0000

Are you sure you can trust this friend of yours? I’d be happy to hold the bet in escrow for the next 18 years, particularly if it’s a sizeable one

By: Graham Young

Graham Young — Fri, 06 Jun 2008 12:07:52 +0000

I think I was already a member of the Tanner left!

By: Jason

Jason — Fri, 06 Jun 2008 12:04:11 +0000

Welcome to the Ferguson left, Graham

By: Graham Young

Graham Young — Fri, 06 Jun 2008 10:45:37 +0000

Well, I like to look at the longterm! I might need the proceeds of the bet about then for my retirement.
You might be right about nuclear and electric (although I wouldn’t mind taking a bet on geothermal instead of nuclear), but they’re not here now. The higher price should stimulate their development, but there’s an issue with how long it might take for them to become readily available. Could easily be longer than 18 years.
I can’t buy diesel at my local servo at the moment. The reason is that they have to get new pumps in, and that takes 3 months. And that’s for a small bit of infrastructure in a well-established technology!
So the problem with a trading scheme when you can’t readily substitute is that it operates by rationing your usage by putting the price up. Natural forces are doing that with fuel at the moment without a trading scheme. But if you put a trading scheme in place you’re going to end up with surplus credits, and the risk is that government will only give a proportion of that back to tax payers and spend the rest on “good works” – infrastructure and services.

By: Jennifer

Jennifer — Fri, 06 Jun 2008 10:21:44 +0000

You wrote: “The problem with carbon credit markets is that they can only work effectively if there is an alternative to carbon based fuel.”
What about nuclear power and electric cars.
And yes your money looks very safe at the moment, but 18 years is quite a while.