1. Standard Oil, the US licensee, had to be compelled to release the licenses to allow other US firms to participate.

2. An oil-burning ship could save 78 percent in fuel and gain 30 percent in cargo space, as compared to a steamship (Yergin 1991, p. 155).

3. Automobile engines reached average compression ratios of more than 11:1 in the early 1960s, but the elimination of lead (in the US) starting around 1970 has forced a regression to around 8:1 or 9:1 today, despite significant use of other additives, such as alcohols and aromatics (benzene, toluene, xylene). The difference has resulted in a fuel economy reduction in the neighborhood of 10 percent.

4. Because of the importance of steel, the Bessemer process (so-called) was designated by historian Elting Morrison as 'almost the greatest invention' (Morrison 1966).

5. Meanwhile vacuum technology itself has progressed, largely thanks to another technology, cryogenics, which was initiated in the 19th century in response to a practical need to keep meat from spoiling during long sea voyages, and later in households. But subsequently cryogenic technology found a host of new industrial applications requiring lower and lower temperatures, including the liquefaction of air and the separation of oxygen and nitrogen. Still later, liquid hydrogen was produced in large quantities for military and space purposes (rockets). When liquid helium temperatures first became achievable in laboratory apparatus, in the 1950s, serious research on the phenomenon of superconductivity began. This research has already led to significant developments in magnet engineering and may eventually pay off in electric power transmission and high speed rail systems utilizing magnetic levitation.

6. In both of these cases the probable cause was the disappearance of the glaciers and the glacial meltwater that had formerly irrigated the land. The remains of that water constitute the Ogallala aquifer underlying much of the US high plains, from Montana to Texas. This water is being rapidly pumped out and is not being replaced.

7. Some experts foresee that the industry will soon be forced to shift once again, from gasoline from oil to hydrogen from natural gas or coal. Such a transition will inevitably be extremely difficult and traumatic.

8. We cannot help mentioning the crisis that was widely expected (and expensively guarded against) but did not occur, namely the so-called Y2K computer glitch problem. One well-known financial economist, Edward Yardeni of Deutsche Bank, predicted a 5 percent drop in the US economy, while others forecast increases in growth due to heavy investment. What actually happened was that US growth did accelerate in the late 1990s, peaked with the stock market in early 2001, and fell into recession thereafter for reasons unrelated to Y2K.

9. This is actually an absolute limit for any heat engine that extracts work from the heat in a high temperature reservoir and rejects heat into a low temperature reservoir (Carnot 1826). Real heat engines, such as the Rankine (steam) cycle, the Otto cycle and so on, have lower limits. However the Carnot cycle does not apply to fuel cells, for instance.

10. The following quote exemplifies the standard view: 'Technical knowledge, being the product of a production process in which scarce resources are allocated, can be produced. We do not know exactly what will be produced, but we are certain that we will know more after an uncertain period (Heertje 1983; emphasis added). While we agree with the statement, we disagree with the implication.

11. As far back as 1980, Science published a gloomy assessment in its Research News section, entitled 'Are VLSI Microcircuits too Hard to Design?' (Robinson 1980). Many other gloomy assessments since then have proven to be wrong as every problem identified by a pessimist was quickly solved. Moore's Law, which has been restated a couple of times since it was first promulgated in 1965 by Gordon Moore, then at Fairchild, subsequently CEO of Intel, who predicted that the complexity of computer chips would double every 18 months. This trend has continued unabated to the present time. However, the concerns being raised nowadays; for example, by Intel engineer Paul Packan (also in Science), involve fundamental physical limits, such as the limiting concentration of dopants (impurities) in the silicon wafers, the increasing variability of dopant concentrations as circuits get smaller, and the increasing propensity to peculiar quantum effects (for example, electron 'tunneling') as semiconductor gates become smaller (Mann 2000). A further difficulty is the disposal of excess heat from very dense circuitry. Nevertheless, optimists still predict that progress will continue at past rates for another decade or two.

12. The assertion that technological progress can be forecast as to general direction hardly needs elaborate justification. For instance there is wide agreement that the 'hot' fields at present are bio-technology (including genetic engineering), information technology and nano-technology. At the next level, of course, the forecasts become more uncertain, and it is important to recall that some past 'near certainties' - such as the development of nuclear fusion technology and space technology - have become much less so as major difficulties were encountered. But there is a massive technical literature on the use of specialized forecasting methodologies to reduce uncertainty. The journal Technological Forecasting and Social Change is perhaps the best source of this literature.

13. There is another sense, or perhaps another kind of knowledge, for which this is not the case. Some kinds of knowledge are only valuable to particular users who have the means to profit from it, at particular times and places. For example, when the London branch of the Rothschild bank learned the outcome of the Battle of Waterloo 24 hours in advance of the rest of the London financial community (thanks to some clever use of signals), it first spread rumors that the battle had been lost, and took advantage of the immediate market crash to buy shares that subsequently rose sharply in value when the true results of the battle were reported. Tens of thousands of others who had the same information were unable to make any use of it, either because they were still in Belgium or France, or because they had no access to funds. Others lost money because they were taken in by the false rumors. The point is that knowledge is not valuable in itself, but only to those with other necessary attributes.

14. There are two reasons. First, human arms, hands and fingers have many more degrees of freedom than any machine yet conceived. Second, and more important, up to now computerized motion controls are exclusively deterministic, which requires simultaneous solution of non-linear equations of motion with as many interdependent variables as there are degrees of freedom. It is obvious that the human brain does not control the motions of the body by solving simultaneous non-linear equations. Similarly, a chess-playing computer does not decide on a move in the same way a human player does. However, nobody has yet figured out how the human brain solves problems, still less succeeded in teaching a computer to solve problems the same way. Artificial intelligence is still a long way off.

15. The rate at which this improvement occurs is typically expressed as a number representing the percentage decline in costs resulting from a doubling of experience, measured in terms of cumulative output. This number is usually taken from the slope of a curve representing the logarithm of unit cost (or price) versus the logarithm of cumulative production, also in units. The steepness of the slope is a quantitative measure of the rate of the learning, which depends on a firm's investment in R&D.

16. The economic literature is comprehensively reviewed in Argote and Epple (1990). For a more technological approach, see Ayres and MartinĂ¡s (1992).

17. A behavioral characteristic that also certainly plays some role is human curiosity (sometimes called 'monkey curiosity'). The desire to learn about the world one lives in may, or may not, need explanation in economic terms, but human curiosity certainly preceded economic relationships. It is a behavioral characteristic common to most higher species of animals. A propensity to explore (provided it can be done safely) has obvious evolutionary survival benefits: the more an individual organism knows about its environment, the more easily it can avoid dangers and find shelter or food.

18. The list of names is very long. Early writers include Ridenour (1951), Holton (1962) and Price (1963). More recent examples include Ayres (1994b, 1998c), Gruebler (1998) and Smil (2001, 2003).

Financial End Game

Financial End Game

How to profit from the global crisis and make big bucks big time! The current global financial crisis has its roots embedded in the collapse of the subprime markets in the United States. As at October 2007 there was an estimated loss on the subprime market of approximately 250 billion. If you want to come out on top, you have come to the right place.

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