David Fuller and Eoin Treacy's Comment of the Day
Category - General

    Spiraling Offshore Wind Costs Show Limits of Biden Inflation Act

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    Orsted’s warnings are the most concrete example yet of the limits of the IRA, which was hailed as a key driver for America’s nascent offshore wind industry. While the law provides at least $370 billion in grants, tax credits and other incentives for climate and clean energy projects, that’s proving no match for rising inflation and borrowing costs. And by dangling higher incentives for companies sourcing US-made parts, it’s fueling demand before the domestic supply chain catches up, driving prices higher still.

    “The irony here is that the Inflation Reduction Act probably has had some part in stoking inflation for some of the green goods that it intends to encourage,” said Kevin Book, managing director at ClearView Energy Partners LLC. The IRA is already spurring construction of new US factories to manufacture critical clean-energy gear, but that’s lagging behind renewable project development, exacerbating the issue in the short term. “It takes a long time to stand up a factory. It takes a long time to replace a foreign-sourced supply chain.”

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    Illumina Names Thaysen CEO After deSouza's Abrupt Departure

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    Thaysen will need to decide how to proceed with Grail, a company Illumina acquired in 2021 that sells a blood test to identify dozens of types of cancer at earlier stages than typically diagnosed. Antitrust regulators in the US and Europe are trying to unwind the deal, which Illumina has vowed to defend despite steep costs, including a nearly $500 million fine in Europe. 

    Meanwhile, Illumina’s DNA-sequencing business faces more competition than ever. The company started shipping its latest machine earlier this year to help maintain its hold on the market. That investment has in part crimped profitability, something Illumina pledged to fix during its proxy fight with Icahn.  

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    Email of the day on Monday's podcast:

    A very interesting commentary today, Eoin. Several of your comments resonated with me. Most important was Mrs Treacy’s observation about Chinese social media reaction to Japanese radiation, and the response from the CCP that the Chinese should stop the negativity - followed by the thought that the negativity will be rapidly removed from the social media records. OMG. I am currently re-reading George Orwell’s book 1984. That’s exactly what he predicted; history rewritten constantly to support Big Brother’s narrative of the day. We should all read 1984 again and contemplate if the West is heading in the same direction.

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    Apple Falls on Report That China Agencies Are Barring iPhone

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    China also was one of the highlights of Apple’s results last quarter, helping offset a generally sluggish period. The company is preparing to unveil its latest iPhones next week, setting the stage for a holiday quarter that is invariably its biggest sales period of the year. 

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    'There's No Plan B': Oil Chiefs Sound Alarm on Refining Woes

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    Low stockpiles are driving an “incredibly strong” diesel structure, signaling market tightness, said Ben Luckock, co-head of oil trading at Trafigura Group.

    It’s becoming more expensive to fund normal refining projects, Alex Grant, senior vice president for crude, products, and liquids at Equinor SA, said in an interview. Existing refineries will operate at the highest rates they can, with refining margins staying high, he said.

    The refining system is “crying out” for fresh investment with oil demand still growing, especially in Asia, said Sri Paravaikkarasu, director of market analysis at Phillips 66. Refiners need to cater to it, while also accounting for the green energy transition, she added.

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    Interesting charts September 5th 2023

    I have decided to reintroduce this feature because I cannot possibly cover every noteworthy chart in the daily commentary.

    The equal pay scandal that drove Birmingham Council to the edge of bankruptcy

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    GMB Organiser, Michelle McCrossen, said: “Today’s announcement is a humiliating admission of failure on the part of Birmingham City Council’s officials and leadership.

    “Not only are they responsible for creating this crisis through years of discriminating against their own staff, but even they no longer believe themselves capable of fixing it.

    “For decades the Council has stolen wages from its low-paid women workers, running up a huge equal pay liability that has brought Birmingham to the brink." 

    They said today's news will be worrying for staff and residents. 

    Equal pay cases are happening across retail as well.  

    We revealed leaked documents that show a boost for the 55,000 claimants taking on Asda - where male dominated distribution centres have higher wages than the shop floor.

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