The coming nuclear financial disaster in fact has many previous models. These stretch back to "classic" stock exchange panics and asset inflation surges of the 19th and 20th centuries, and to the first nuclear asset boom of about 1974-1983. In particular, the US subprime crisis will provide a model by it size, economic damage and international impact.
...The mechanism of the coming nuclear asset boom-bust, or nuclear financial crisis, is easy to describe: investment in productive assets, such as housing or nuclear power plants, becomes a conservative inflation hedge as well as a productive asset, before finally "mutating" into a purely speculative gaming chip or token.
During this process, the inflation rate of asset prices, and related or supporting assets (for example housebuilding materials for realty, and uranium for reactors), increases very fast. Towards the end of the process, the inflation rate is extreme.
The time needed for the shift from one category to the next can be limited - only a few years as in the US and European "railroad booms and slumps" of 1873 and 1893, or the "copper panics" of 1893 and 1907. In these "classic crises", the borderline between rational investment in productive assets (railroads and copper mines), and an inflation hedge, and finally an outright speculative play, was compressed into a period of as little as 3 to 5 years.
During this critical mutation period, as in any financial crisis, public authorities and so-called experts will reassure speculators the underlying assets are sound and even "undervalued" when marked to market.
..Reactor building costs and forecasts, since about 2005, have radically increased, with the current annual inflation rate probably how standing at about 25 percent.
In a 2010 report published by the University of Vermont Law School on reactor costs and nuclear economics, its author Dr. Mark Cooper said:
We are literally seeing nuclear reactor history repeat itself. The 'Great Bandwagon Market' (of the) 1970s and 1980s was driven by advocates who confused hope and hype with reality. .... in the few short years since the so-called 'Nuclear Renaissance' began there has been a four-fold increase in projected costs. In both time periods, the original low-ball estimates were promotional, not practical; they were based on hope and hype intended to promote the industry.Read more at the source (large post warning ;-)
NOTE: Haase - I want to be wrong about this.
The reality and the gravity of the situation is dire... regardless if you 'perceive' nuclear energy as the carbon neutral messiah or support the current 'Nuclear Renaissance', at the rate that current energy plants are required to be decommissioned (due to safe working lifespan) we will be shutting down more facilities in the next decade faster than we could theoretically build them. - Unless we make reckless safety or epic cost choices, these plants and their 'thirty year old radioactive waste' will continue to plague the heart our nations energy future.
