About Investing in Ethanol

Video Transcript

"Did you ever wonder why the price of bread has moved up so rapidly over the last two years, why the price of tortillas has moved up so rapidly in the Latin markets over the last couple of years? Well blame it on ethanol. The wonder all fuel of the future as determined by principally the US government. And why ethanol? Well it's a very clean burning fuel that looked attractive in today's environmentally conscious environment. However that's not the whole story because it takes more energy to create a gallon of ethanol then it does to create a gallon of gasoline. And when you take that into account, well maybe it's not such a low carbon footprint. Certainly around the world there has been tremendous damage done because of the use in the US of ethanol. In all likelihood the tax credits that came with investing in ethanol will not be renewed which means that it's place in the US energy market will continue to decline. The electric cars coming in 2010 and 2011 will certainly have a lower carbon footprint then the ethanol fueled cars of today. Therefore we believe that the tax incentives today apply to ethanol will be shifted to electric. It should help GM, Ford, Chrysler a lot which because the US is now about to become a shareholder in each, they'll want to do. So best thing to do with corn, eat it. Worse thing to do with corn, make ethanol. That's a little bit about fuel prices though, I'm Roger Groh and thank you very much for spending time with me."