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Existing nuclear plants have relatively low operation, maintenance, and fuel costs compared to many fossil fuel plants; however these routine costs still make nuclear power economically uncompetitive in comparison with natural gas, wind, and solar.
New nuclear plants are another matter altogether; their continuing high construction costs make them uneconomical. Between 2002 and 2008, cost estimates for new nuclear plant construction rose from between $2 billion and $4 billion per unit to $9 billion per unit, according to a 2009 report by the Union of Concerned Scientists. In reality, even those astronomical projections have been surpassed. The two new units at the Vogtle Plant in Georgia, the only new nuclear construction in the United States, are now years behind schedule and projected to cost more than twice their original budget of $14 billion. Similarly, it was estimated that Duke Energy’s proposed Levy County Nuclear Power Plant in Florida would cost $5 billion, but projections ballooned to $22 billion. The project was canceled in 2017, and Duke Energy decided to focus on solar energy expansion instead.
Reactors also typically require a long period of planning, licensing, and building. The 2019 World Nuclear Industry Status Report (WNISR) estimates that since 2009 the average construction time for nuclear reactors worldwide was just under 10 years.
The WSINR report also estimates that the cost of generating nuclear energy ranges between $112 and $189 per megawatt-hour (MWh), while solar power costs between $36 and $44 and onshore wind power comes in at $29 to $56.
It seems like an alternative to a bank for Germans would be a Money Market fund, perhaps in a brokerage account.
Unless the MM will also charge to hold your money.
David
FDRXX Summary Prospectus(a) In order to avoid a negative yield, Fidelity Management & Research Company LLC (FMR) may reimburse expenses or waive fees of Fidelity® Government Cash Reserves. Any such waivers or expense reimbursement would be voluntary and could be discontinued at any time. There is no guarantee that Fidelity® Government Cash Reserves will be able to avoid a negative yield.
Interest rates have been negative in Europe for years. But it took the flood of savings unleashed in the pandemic for banks finally to charge depositors in earnest.
Germany’s biggest lenders have told new customers since last year to pay a 0.5% annual rate to keep large sums of money with them. That is creating an unusual incentive, where banks that usually want deposits as an inexpensive form of financing, are essentially telling customers to go away.
The pandemic has changed the equation. Savings rates skyrocketed with consumers at home. And huge relief programs from the ECB have flooded banks with excess deposits. Banks also have used the economic dislocation of the pandemic to make operational changes they have long resisted.
According to price-comparison portal Verivox, 237 banks in Germany currently charge negative interest rates to private customers, up from 57 before the pandemic hit in March of last year. Charges range between 0.4% and 0.6% for deposits beginning anywhere from €25,000 to €100,000.
The ECB’s deposit rate, which it charges banks, is minus 0.5%. The central bank has signaled it is unlikely to change that level anytime soon.
Banks in Germany are particularly hit by negative rates because Germans are big savers. About 30% of all household deposits in the eurozone are in Germany, according to the ECB. Last year, deposits in the country rose 6% to a record €2.55 trillion as people became wary of spending under the pandemic or simply had nowhere to spend, with restaurants closed and travel restricted.
In Denmark, where interest rates were cut to below zero two years before the eurozone, banks have gone from charging wealthier clients to smaller ones over the past year. The Danish central bank estimates about a quarter of the country’s depositors are currently being affected.
Nordea Bank Abp recently lowered the deposit threshold for a 0.75% charge to 250,000 danish krone, equivalent to $41,000, from 750,000 danish krone as the pandemic will likely prolong the era of negative rates.
The flip side for customers there, is that in some cases, while they pay to deposit money, they don’t have to pay anything to borrow. Nordea in January started offering 20-year mortgages at 0%.
Thanks for the tip. I did read your link. And I did look into RPHYX on other sources.@WABAC, you may want to review River Park Short Term High Yield, RPHYX. David has provided a detail analysis of the fund.
https://mutualfundobserver.com/2017/05/riverpark-short-term-high-yield-fund-rphyxrphix/
YTD return is +0.3% while vast majority of bond funds are in red for the year.
Hmmm...Many believe non-investment grade bonds is the place to be right now and for the near-to-intermediate future.fmsdx cfiax azanx hold a lot of non investment grade bonds so they dont compare well to hblix, wbalx or bampx. they are all classified as conservative allocation funds. but fmsdx cfiax and azanx loose a lot more when the market melts down. I would rather buy moderate allocation funds with more stocks. such as lkbax,msfrx,mapox.Which I own.
If US investment opportunties are so great, why is he buying back $9 billion worth of Berkshire Hathaway stock? The answer is that he have had hard time buying them within his metrics and this is consistent with his investment pattern for a number of years. Recent purchase in drug and telecommunication stocks is a reflection of his forward looking view in post-pandemic scenario.“Bonds are not the place to be these days,” Buffett said. “Fixed-income investors worldwide – whether pension funds, insurance companies or retirees – face a bleak future.”
Buffett noted that the benchmark 10-year Treasury yield had fallen drastically to 0.93% at the end of 2020 from 15.8% in September 1981. Meanwhile, investors earn a negative return on trillions of dollars of sovereign debt in Germany and Japan, he added.
© 2015 Mutual Fund Observer. All rights reserved.
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