Vladimir Putin is running roughshod over International Law and the EU is addressing Coffee Makers

Posted by PITHOCRATES - April 19th, 2014

Week in Review

Vladimir Putin is running roughshod over international law.  He took Crimea.  And is threatening further parts of Ukraine.  Some think he will take Moldova next.  Or possibly one of the Baltic States.  And what is the European Union (EU) doing to protect democracy?  This (see EU lays down the law on coffee making by Edward Malnick posted 4/19/2014 on The Telegraph).

Filter coffee machines will have to turn off automatically to help save energy, under new European Union rules.

All of the devices on sale for domestic use from next year will be required to go into “standby mode” after brewing the drink, the Sun reported.

The European Commission said the changes would save money on electricity bills and were “supported by consumer and industry organisations” as well as member states including the UK.

However campaigners claimed the rules would leave many people with “cold coffee”…

Those machines with non-insulated jugs will have to go on standby after no more than 40 minutes.

Really?  Coffee makers?  That’s the threat to Europe?  Not Vladimir Putin running roughshod over international law.  I guess the EU has a different set of priorities.

All right, let’s look at the cost savings for the average EU consumer.  In America we typically brew a pot of coffee and let it sit on the warmer for maybe 2 hours.  After that it gets a little strong.  So let’s look at two hours.  Assuming a typical 600 watt heating element and an electrical cost of $0.15/kilowatt-hour the cost savings comes to $0.12.  If we brew a pot every morning that comes to a cost savings of $43.80 per year.  Of course, people will have to warm up their tepid coffee after the coffee maker automatically shuts down.  And the most likely way will be in a microwave oven for about 30 seconds.  You do this for three cups of coffee and you’re not going to consume much electric power.  But you’re going to put a lot of wear and tear on your microwave oven.  Which cost more than the $43.80 savings in electric power.  Not to mention the inconvenience of having to run your microwave when you want another cup of coffee.

You know what can keep that coffee warm without stressing your microwave oven?  The coffee maker.  For only $0.12 a day.  There are people that won’t stoop to pick up a coin if it’s less than a quarter.  So do you really think the people are going to appreciate paying more for a coffee maker (that now must include a timed shutoff mechanism) so they can go through microwave ovens quicker just to save $0.12 a day?  Probably not.

This is the problem with a nanny state.  Which the EU is.  The worst part is that these people are paid by taxes to come up with these brilliant ideas no one needs.  Something taxpayers may be more in need of is a way to stop the law-breaking ways of Vladimir Putin.  For Vladimir Putin probably poses a greater risk to Europe than coffee makers.

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Electric Car Builder Tesla increases Battery Order by 900%

Posted by PITHOCRATES - November 2nd, 2013

Week in Review

Say’s law states that supply creates its own demand.  Think of some of the greatest inventions in our life and you’ll see that Say’s law is true.  Today’s kitchens aren’t complete without a microwave oven.  Yet we didn’t demand a microwave oven.  Because we had no idea what it was until someone created it.  And told us how wonderful it was.  Then we started buying them.  The supply of microwaves came first.  The demand then followed.  Hence, supply created its own demand.  Just like Say’s law states.  You know who else believes in Say’s law?  Elon Musk.  The guy who founded PayPal.  SpaceX.  And Tesla Motors (see Tesla boosts battery order from Panasonic by Reuters posted 10/30/2013 on The Globe and Mail).

Tesla Motors Inc. will sharply increase the number of lithium ion battery cells it receives from Japan’s Panasonic Corp, in a deal that underscores the U.S. car maker’s confidence in the future of all-electric cars.

Electronics maker Panasonic, already Tesla’s primary supplier of lithium-ion batteries, will provide nearly 2 billion lithium ion cells to the car maker in the four years to 2017, the two companies said on Wednesday.

That is a big step-up from the 200 million cells Panasonic is expected to have supplied to Tesla in the two years ending this December.

The deal shows Tesla’s faith in its models despite slower-than-expected global sales of electric vehicles.

Going from 200 million to 2 billion?  That’s an increase of 900%.  It’s one thing to have faith and believe in your product.  Believing that your supply will create demand.  But there is another economic concept that may be pertinent here.  One from the Austrian school of economics.  Malinvestment.  Taking advantage of cheap capital and government subsidies to make bad investments.  Hence malinvestments.  For it is unlikely that any business is going to see a 900% sales growth in the coming year let alone the narrow niche market of electric cars.  Even Jean-Baptiste Say himself would probably say that’s some pretty wishful thinking that a 900% increase in supply will generate a corresponding demand.

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