The end of ethanol....
This is good news....but what's the next horror from the environmentalists???
Once upon a time, ethanol was seen as the future of clean energy and as leading the U.S. to energy independence.
That was 2004, but Wall Street wised up fast that ethanol was ready for a bust. So, in 2006 and 2007, when Wall Street firms started investing their own money in renewable energy companies, they left ethanol far behind.
“It’s such a waste that the government gave free handouts and subsidies to grow a business that wasn’t sustainable,” said one investment banker familiar with the sector.
It is one of the few things Wall Street investment banks have gotten right lately, while private investors including Bill Gates and Richard Branson were bullish on ethanol as recently as January. We were thinking of this in reading about how this weekend ethanol producer VeraSun Energy filed for Chapter 11 bankruptcy protection. It was hardly a surprise, given that a month ago, VeraSun was predicting a steep loss and hired Morgan Stanley to evaluate its options. And the company isn’t alone; the entire ethanol sector is getting its comeuppance. Goldman Sachs Group analysts today dropped coverage of all ethanol companies because of the plunge in market valuations for ethanol companies and what the analyst see as their dim future.