SCTY and solar subsidies

There are subsidies specific to residential solar that aren’t available to other forms of solar.  Essentially, homes without solar subsidize the ones with solar by paying higher electricity rates.  I don’t think that this is sustainable in the long run.  For there to be more residential solar, electricity rates will have to go higher and higher.  (Ironically this improves the economics of subsidized residential solar.)  At some point, I think that voters will ask for lower electricity bills.  Eventually, politicians “ought” to reduce residential solar subsidies.

(The analysis in this post is superficial.  I apologize in advance.)

Continue reading

Beating Wall Street in oil and gas

For whatever reason, it seems that many institutional investors analyze this sector poorly.  This creates wonderful opportunities for short sellers.  To recap, this sector has attractive shorts because:

  1. It seems that many institutional investors don’t understand how oil and gas companies inflate their reserves.
  2. Inflated reserves are very common among oil and gas companies.
  3. Institutional ownership is high enough that there are reasonable borrows on these stocks.
  4. Many management teams use the company as their piggy bank to pay for corporate jets, expensive meals, etc.
  5. Valuations are high.
  6. A few of these companies are pump and dumps.

Continue reading