Well, I get to maybe backtrack once again on Greece. It looks like cooler heads may prevail. Which would be wonderful. I actually agree with the IMF that any real deal probably needs some debt relief.
Next, I would like to acknowledge the passing of Mike Birck the founder of Tellabs. I met Mike for any real length of time during Tellabs acquisition of AFC. He struck be as a very nice man who worked hard and treated his employees fairly. I respected him at the same level I respect Don Green. Not too many can be put in that category. I hope all of you get to work with and for giants of an industry like Mike and Don.
We are going to be in quarterly earnings mode soon and I wanted to talk a bit about the ending of more and more solar industry subsidies. I don’t think the industry is going to disappear but there is one segment that I think is going to slow dramatically when the Federal Government credits go away. That is the group of companies that lease power to owners via solar systems that they install on homes. This group was capitalized by investors who have been getting a magnificent return on their invested capital. Remember the leasing company gets all the tax credits since they “own” the systems. This dramatically lowered their up front cost and now they can reap the long term benefits of having good sized installed bases to collect revenue from going forward. That does not mean that those systems are going to be turned off. What is likely to happen is that either new systems will cost more (maybe actually have an installation cost) or there will be fewer of them. Just something that might change the profile of the market some.
And by the way, I want to compare how this type of incentive has worked in the solar industry to how things have not worked in the telecommunications industry. Well, depending on how you look at the outcome. I plan to do that Friday in my Net Neutrality post.
I keep hearing that this is going to be a very strong El Nino year. Well, I think at this point I will adopt a “wait and see” attitude. The extra rain would be very helpful, but I keep having a feeling that these long range forecasts just tend to be wrong. My experience is in watching Hurricane seasons. I lived in Florida for 15 years and especially after Hurricane Andrew (which we were on the edges of) I really watch what the National Hurricane Center (NHC) does. The overall predictions don’t come from them but different researchers. I have seen no ability to predict the intensity of a season. But the NHC has gotten very accurate on storms when they actually happen. I read the notes that the forecasters post and they are fascinating to me for some reason. Take a read of them some time. Nice to see science in action.
Have a great day!
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