Pockets of rot

• by Martin Hutchinson
• November 30, 2009
• Excerpts
  

Beyond Dubai... there are a number of other areas that on closer inspection appear to be patches of rot that will eventually collapse, causing immense losses to those involved in them... there is undoubtedly rot in the green-tech bubble of the past few years.

Quite apart from the question of whether the entire global warming extravaganza was a gigantic hoax, as now seems possible (probably not entirely, but its over-inflation certainly was), the companies set up using readily available pools of over-excited venture capital don't look like ordinary youthful tech ventures. Instead of their "footprint" expanding inexorably like Google's until it seems about to take over the world, it has remained stubbornly modest, with their margins remaining slender and their revenues heavily dependent on new research grants from various government "stimuli" and other non-market sources. That suggests that the oxygen of genuine and explosively expanding demand for their products and services simply is not there; they will limp along at marginal profitability as long as the money lasts, but will then collapse altogether leaving no permanent results other than investor losses and the wrecked career prospects of their unfortunate ex-employees.

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