In today’s post, Mish gives (yet another) warning about Japan’s unsustainable economic road, and makes a good suggestion (my emphasis)

At some point, I suggest now, Japan needs to stop blaming the earthquake and tsunami for its collapse in exports. Furthermore, Japan is going to have difficulty financing its debt unless its turns the situation around quickly.

That may not be likely as Japan logs record trade deficit in January

Imports rose 9.8 percent from a year ago and energy prices are one of the reasons. Japan needs alternate energy sources following the shutdown of its nuclear reactors.

While rising imports may still be blamed on the tsunami, the collapse in exports has a different reason. Europe is in a major slowdown and more US consumers are happy with GM and Ford autos.

via Mish’s Global Economic Trend Analysis: Japan Posts Record Trade Deficit in January, 4th Consecutive Deficit Month.

On the matter of alternate energy, Prof. Lenz has done a great job recently of translating from Japanese into English Japan’s new feed-in tariff law, which is closely connected with consumer usage of alternative energy supplies (especially, but not limited to, solar): http://k.lenz.name/LB/?cat=31

Prof. Lenz seems to be a believer in using the power of government to force businesses or consumers into certain paths of economic behaviour:

In my opinion, building codes world wide should make solar panels as part of the roof obligatory. Just as there are building codes designed to reduce the risk of fire (which of course come with a cost), there should be building codes designed to help avoiding killing everyone on the planet by Venus Syndrome.

Mish is not at all sure using government power to force a “green agenda” is a good idea.

Solar Energy Madness in Europe

In an effort to spur solar energy in France, Germany, Spain and other European countries, bureaucratic dunces decided to pay as much as 10 times market rates for those supplying energy to the power grid.

In response, farmers in France have started building “barns” that serve no other purpose than a place to put solar panels. Supermarkets put solar panels on their roofs and unused sections of parking lots.

It has been a boom to solar panel makers (China), but it is costing costing the French power company Electricite de France SA more than a billion euros ($1.3 billion) a year to meet government mandated pledges to accept solar energy from those supplying the grid.

At the end of 2010, EDF received 3,000 applications a day to connect panels to the grid. In 2008, the number of applications was 7,100 for the entire year.

The results should have been easy to predict in advance, but you can never explain anything to economic illiterates interfering in the free markets hoping to make things better. They never do. (from Sunday Funnies 2011-01-23 Student Loans; Solar Energy Madness in Europe)

Obviously this is silly: the historical record will clearly show that politicians only have humanity’s best, long-term, interests at heart. What other motives could they possibly have for pushing green energy?

It is, admittedly, disappointing to read that the Earth Summit is doomed to fail:

said Syukuro Manabe, a climate modeller at the US National Oceanic and Atmospheric Administration, “the political system is not motivated to worry about the future“.

And here is another idiot who clearly doesn’t  know what he is talking about: politicians as thieves, in a system that discourages them from treating resources as scarce? Nuts!

Mish is just a successful investment advisor and fund manager. What the hell he know about economics?