There is an article on Bloomberg about Sumitomo’s warning that a solar bubble is forming in Japan:
As Goldman Sachs and billionaire Masayoshi Son lead a swarm of investors exploiting Japan’s solar power subsidies, the world’s biggest, Sumitomo Corp. is betting on wind. Sumitomo’s focus is in part a response to a rush into solar projects that’s pushing up land prices and salaries, as well as luring investors from gambling parlor operators to asset managers. “With so many companies rushing in we are seeing a solar bubble forming and land prices are rising,” Sumitomo’s Shinichi Kitamura said in an interview.
The article then goes on to point out one of the unintended consequences of Japan’s rapidly growing solar industry:
Though the effect is not yet felt nationwide, the amount of space solar plants need will push up land prices because suitable space is limited, said Takashi Ishizawa, the head of real estate research at Mizuho Securities Co. With land prices falling in Japan for the last 21 years, according to the Ministry of Land, Infrastructure, Transport and Tourism, renewable energy investment may help the country in its fight against deflation that has dragged on the economy for decades.
Hmmmm…..I’m wondering if Bernanke, the National Association of Realtors and all of those banks holding mark to fantasy real estate assets on their books might want to join forces and create a massive solar bubble in this country. After all, it might be a much cheaper way to try and reinvigorate the moribund housing market than the Fed’s recent plans to buy $40 or so billion dollars worth of MBS every month.