Energy: How Mother Nature Will Help Power the World
The future of energy centres around two key questions: what can we use that is plentiful and easy to come by? And how can we use this to power our world?
Of course there is the massive power from the sun. One way to look at the power potential of the sun is in just one hour there’s enough energy hitting the earth to power the whole planet for a year. The debilitating factor is our inability to capture and store this energy.
So with the sun’s power in mind, do you remember your early days of school and how plants work?
Let’s quickly recap anyway. Plant science 101. Leaves capture light from the sun. They convert this into fuel for the plant. A by-product is oxygen and also water. This process is photosynthesis.
Now let us explain why this is so important for powering the world.
Inspired by Mother Nature scientists from the Massachusetts Institute of Technology (MIT), notably Professor Daniel Nocera, created an artificial leaf. Obviously this artificial leaf uses the light from the sun, and splits this energy into oxygen and hydrogen. This discovery was a couple of years back and was quite inefficient at the time. But none-the-less, it was ground-breaking. As Prof. Nocera explains,
‘So when the sun goes down you can then take the hydrogen and oxygen, recombine them in a fuel cell and then you get electricity out. So at night you have electricity…and so all of a sudden your house has become a power station.’
With all signs pointing to success, the project came to a bit of a cross-road last year. The spinoff company from the discovery, Sun Catalytix, wasn’t sure of the economic benefit over existing hydrogen splitting technology. There was even talk about not developing the project for further testing.
Well guess what? Technology advances quickly! Prof. Nocera and his team are further down the track towards making the artificial leaf a commercial reality.
If they can get this technology into the mass market homes become power stations and ‘gas’ stations. What we mean by gas station is, plug in an electric car as your house provides the fuel source. You no longer rely on dirty power to sustain the household. Homes become ‘trees’ with multiple artificial leaves generating and storing fuel in an environmentally efficient way.
Not only that, but if economically produced and scaled, cheap power becomes available for all. Consider that many developing African countries don’t have access to readily available, cheap power. This means raising the quality of life for the impoverished.
What Prof. Nocera and some colleagues have done literally in the last month is complete a detailed report. And not just any old detailed report. This report maps out all the potential problems of the artificial leaf. This is the biggest step forward the team have made to brining the technology to commercial reality.
But why is it a good thing to understand all the problems? By understanding what is not good about it, they can fix these to make it better. It’s a fine example of reverse engineering.
Furthermore with this report in hand, they are now starting to sort out the problems. These improvements are making their discovery economically possible. Already they’ve discovered efficiency increases 3.4 times greater than they had 18 months ago. Imagine what they’ll have done in the next 18 months.
Gold: What if Gold is Just Like a Share
We don’t know if you can imagine this or not, but there is quite a debate going round the office here about the direction of the gold price and gold stocks. Why? Because everyone here is a sound money advocate.
We believe central banks should stop meddling with the financial system by constantly printing money and therefore devaluing your wealth through inflation.
But there’s another reason why gold has been the talk-of-the-town in recent weeks. It’s because of this chart:
The chart shows you that over the past year, while the Dow Jones Industrial Average has gained a respectable 10%, gold and gold mining stocks have fallen. In the case of the Junior Gold Miners ETF (green line) it has fallen 41% in twelve months.
It has our colleagues wondering where it can go next, and the mainstream is now seriously running the line that the gold bull market is over. As John Authors concludes in the Financial Times:
‘Ultimately it’s very similar to the stock market. If the economy really finds traction then stocks can make true strong new highs and gold can go into a clear reverse. That remains a big “if”.’
As we wrote in last week’s Money Weekend, we’re taking a slightly different view on gold from the rest of our colleagues. We think that as stock markets have recovered to some degree, investors have forgotten about the immediate fear of total financial collapse.
That means they’re treating gold as they would any other share investment – if they think it will go up they’ll buy; if they think it will go down they’ll sell.
Maybe it’s more complicated than that. But we like to keep things simple. Don’t get us wrong, we still like gold, and we haven’t sold a bar of it…ever. And we don’t intend to.
But for now, as we wrote in yesterday’s Money Morning, there are perhaps better places to invest your free cash flow than gold.
Technology: The Future of Kids’ Education Starts NAO
Look at it like this. If you moved to Russia you’d probably make sure you could understand Russian. China, you’d get a grasp of Mandarin. Italy, Italian. You see the trend.
However, the most universal of languages on earth is the least taught, and understood. We’re talking about computer code.
But there’s a movement to change this, and specifically to help children to understand and be fluent in coding. This is a key step, because without it children may face a future of job insecurity and difficulty.
The point is that kids should engage with coding like it’s a second language. Technology is already a part of their upbringing, so it’s important to find new and innovative ways to fuse together kids and coding.
Most people won’t believe this but there are already a growing number of humanoid robots helping educate our kids. These mechanical marvels are providing the path for kids to learn the art of coding and robotics.
You see, the little robot’s name is NAO and aside from being high on the scale of cuteness, they’re taking the education experience to a whole new level.
Already in over 200 schools worldwide, students are getting a more engaging, intuitive and fun learning experience. And you can put it down to NAO. Given the growing importance of computer technology in the workplace, wouldn’t you want your kids to get this kind of engagement at school? We know we would.
How amazing would it be if every school had access to this kind of learning experience? We think it’s crucial to help engage kids with the digital age we live in. And it all starts with the way they’re educated.
And by the way, if you think NAO will only be in schools. It won’t. NAO parent Aldebaran-Robotics has been working on a general-public release of the little guy. So before you know it you might come home to a 58cm robotic friend of your own.
Health: The HIV Game Changer
Some breakthroughs are unbelievable. For years the scientific world has stated one day we will cure HIV. And deep within the pessimistic section of the brain, you might have thought, ‘Yeah right, it will never happen.’
Well we’re here to tell you that it has happened. And this is game changing.
Let us explain. A newborn girl in the US carried the HIV infection because her mother has the disease. Upon birth the doctors knew that the best chance the little girl had for a ‘normal’ life would be preventative treatment. They fully expected to manage the infection, as with many HIV babies before her.
Doctors continued treatment of the girl for 29 days with existing FDA approved antiviral drugs. At this milestone HIV was undetectable in her body and follow up treatment continued until the infant was 18 months old. Then, mother and child vanished…10 months later they resurfaced. Sadly the mother said they had not kept up with any form of treatment for the girl’s HIV.
Of course the doctors expected the worst. Regardless, they performed standard tests to see if in fact the virus had returned. They predicted hidden HIV cells would have reproduced and returned the virus to the child.
Oh how they were wrong! Incredibly, after re-testing the child for HIV several times, the virus was still undetectable. And the child today (with no ongoing treatment) continues to be functionally free of HIV.
What this means is drug companies already have the arsenal to blow away HIV. And now doctors have a roadmap to apply the method. The key to success – well at least it’s thought to be for now – is the early stage of treatment in newborns.
The funny side of it is doctors are pretty confident they came about this discovery by accident. But they have rid this little girl of HIV, so accident or not, it’s a first.
Just think about a world of doctors getting to HIV infected babies early enough. What a huge step forward in choking the disease.
Eradication of any disease is extremely difficult. And when we look back through the pages of history we can only find two examples. Smallpox and Rinderpest (a cattle plague). Polio is hoped to be the third. With this successful outcome and huge step forward, HIV could be the fourth.
Mining: An Unconstitutional Tax
Our old buddy Dr Alex Cowie is off to the Hong Kong Mines & Money conference in just over a week. He’s there to present on gold stocks.
Given the gold chart we’ve shown you above, it could account for some interesting discussions about whether now is a good time to buy both the metal and the stocks.
Doc Cowie was last in Hong Kong for this conference in 2011. During that event he had the pleasure of watching a presentation by Fortescue Metals [ASX: FMG] chairman, Andrew Forrest.
As far as we know, Mr Forrest isn’t making a trip to Hong Kong this time. Perhaps because he’s too busy challenging the constitutionality of the Federal government’s Mining Resource Rent Tax (MRRT).
That’s the tax that has been so successful that it has only raised a fraction of the amount expected by the government. As we noted on our Google+ page a few weeks ago, that’s our kind of tax. A tax that doesn’t add a bean to the government’s coffers is a tax worth voting for.
Even so, Mr Forrest isn’t one to let a dud slowly die. Fortescue doesn’t expect to pay any MRRT this year, but the company is still challenging the tax in the High Court.
According to The Australian:
‘The plaintiffs have also argued in written submissions that the MRRT limits the ability of the states to be competitive against other states and raise royalties.’
We doubt that Fortescue will win its case. Judges are paid by the State and will always side with the State as it looks to increase its influence and control over individuals.
That said, we’ll wish Fortescue luck with its case. As for Doc Cowie, he’s promised to keep Money Morning readers updated on all the happenings at the Mines & Money conference.
Kris Sayce and Sam Volkering
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From the Archives…
Gold’s Dark Hour Before Dawn
1-03-2013 – Dr. Alex Cowie
The Primary Colours of Investing
28-02-2013 – Kris Sayce
Revealed: Inside a Share Trader’s Den
27-02-2013 – Murray Dawes
Where to Find Value in this Rising Stock Market
26-02-2013 – Kris Sayce
China Bull Versus China Bear – There Can Only Be One Winner
25-02-2013 – Dr. Alex Cowie
