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I think the lack of long-term futures contracts is evidence that nobody has a clue about the price of commodities in the long-term.

yequalsx 16y ago
But then futures contracts don't give "an idea of future scarcity". How does your current statement mesh with your previous one? It seems like the conclusion is that no one thinks they know enough about future scarcity to be willing to place bets on it.
- AngryParsley 16y ago
  While the predictions of scarcity are likely correct, the predictions of the consequences of scarcity likely aren't. For example: Once the cost of helium increases, substitutes will be found for many applications. For a buoyant gas, people might use hot air, or hydrogen mixed with some kind of flame retardant. Low temperature research might rely more on computer simulations. MRIs and other devices might use high temperature superconductors bathed in liquid nitrogen. The only problem would be if helium scarcity happened too quickly for people and technologies to adapt. If you thought that was likely, you could invest in companies making or researching helium substitutes and make a killing. It seems like the conclusion is that no one thinks they know enough about future scarcity to be willing to place bets on it. Almost. Nobody knows enough about future scarcity to be willing to place bets on it instead of placing bets on other investments such as index funds. If you enter into a 20 year futures contract, you're saying, "I believe I will make more money from selling this resource in 20 years than I would from investing the value of this contract in index funds for 20 years."
  - yequalsx 16y ago
    Thank you for the clarification.
  - kragen 16y ago
    > While the predictions of scarcity are likely correct, the predictions of the consequences of scarcity likely aren't. For example: Once the cost of helium increases, substitutes will be found for many applications. For a buoyant gas, people might use hot air, or hydrogen mixed with some kind of flame retardant. Low temperature research might rely more on computer simulations. MRIs and other devices might use high temperature superconductors bathed in liquid nitrogen. Those are cool speculations. Hydrogen is probably the only option for a buoyant gas. I don't think mixing flame retardants in with hydrogen will work; you either need something lighter than nitrogen (and hydrogen, helium, and neon are the only candidates) or something that can retard flame appreciably in such small quantities that it doesn't counteract the buoyancy, and I don't think any such substances exist. They'd either have to produce a lot of non-inflammable gas, the way sodium bicarbonate does, or absorb a lot of heat like tetraethyl lead, and in either case they have to be pretty heavy. For superconductor and other cryogenic coolants, as they said, liquid helium is already recycled. I like the idea of using high-temperature superconductors. Maybe invest in yttrium mines? (I guess there are lots of high-temperature superconductors today.) Why don't these devices currently use high-temperature superconductors? Are they too expensive? (Edit: http://pubs.acs.org/subscribe/archive/ci/31/i06/html/06chem.html http://pubs.acs.org/subscribe/archive/ci/31/i06/html/06chem.... says that 123, YBCO, and its family are only superconducting within a single crystal, which makes it hard to make large coils out of them.)

yequalsx 16y ago

But then futures contracts don't give "an idea of future scarcity". How does your current statement mesh with your previous one? It seems like the conclusion is that no one thinks they know enough about future scarcity to be willing to place bets on it.

AngryParsley 16y ago
While the predictions of scarcity are likely correct, the predictions of the consequences of scarcity likely aren't. For example: Once the cost of helium increases, substitutes will be found for many applications. For a buoyant gas, people might use hot air, or hydrogen mixed with some kind of flame retardant. Low temperature research might rely more on computer simulations. MRIs and other devices might use high temperature superconductors bathed in liquid nitrogen. The only problem would be if helium scarcity happened too quickly for people and technologies to adapt. If you thought that was likely, you could invest in companies making or researching helium substitutes and make a killing. It seems like the conclusion is that no one thinks they know enough about future scarcity to be willing to place bets on it. Almost. Nobody knows enough about future scarcity to be willing to place bets on it instead of placing bets on other investments such as index funds. If you enter into a 20 year futures contract, you're saying, "I believe I will make more money from selling this resource in 20 years than I would from investing the value of this contract in index funds for 20 years."
- yequalsx 16y ago
  Thank you for the clarification.
- kragen 16y ago
  > While the predictions of scarcity are likely correct, the predictions of the consequences of scarcity likely aren't. For example: Once the cost of helium increases, substitutes will be found for many applications. For a buoyant gas, people might use hot air, or hydrogen mixed with some kind of flame retardant. Low temperature research might rely more on computer simulations. MRIs and other devices might use high temperature superconductors bathed in liquid nitrogen. Those are cool speculations. Hydrogen is probably the only option for a buoyant gas. I don't think mixing flame retardants in with hydrogen will work; you either need something lighter than nitrogen (and hydrogen, helium, and neon are the only candidates) or something that can retard flame appreciably in such small quantities that it doesn't counteract the buoyancy, and I don't think any such substances exist. They'd either have to produce a lot of non-inflammable gas, the way sodium bicarbonate does, or absorb a lot of heat like tetraethyl lead, and in either case they have to be pretty heavy. For superconductor and other cryogenic coolants, as they said, liquid helium is already recycled. I like the idea of using high-temperature superconductors. Maybe invest in yttrium mines? (I guess there are lots of high-temperature superconductors today.) Why don't these devices currently use high-temperature superconductors? Are they too expensive? (Edit: http://pubs.acs.org/subscribe/archive/ci/31/i06/html/06chem.html http://pubs.acs.org/subscribe/archive/ci/31/i06/html/06chem.... says that 123, YBCO, and its family are only superconducting within a single crystal, which makes it hard to make large coils out of them.)