John Ransom

The proof of the failure of solar power isn’t in the Solyndra bankruptcy, but in potential BKs by industry leaders like First Solar (FSLR), the largest solar company in the world.

Since May of 2008, when First Solar reached its all-time high of $311, the company has lost 90 percent of its value, falling to $31-$33. The company has been selling assets tied to government loans, insiders have been cashing out the stock and the number of short-sellers- those investors who are betting the stock will go down- now amounts to about 43 percent of the shares in public hands as of December 15, 2011. In the meantime CEO Robert Gillette exited stage right, with $30 million thank you from the company in October of 2011.

But he didn’t leave before First Solar received federal loan guarantees and other consideration to the tune of $3.5 billion.

Today, FSLR stock is worth about $3 billion in market capitalization even after federal, state and local largesse.

First Solar Stock Chart

First Solar Stock Chart by YCharts

Thank you Robert Gillette. Between 2008 and 2011 Gillette and First Solar spent a little over $2 million on various lobbying activities along with $300,000 to various “green-friendly” candidates. That’s investment that Democrats at least can believe in.

The market however isn’t as gullible.         

When Obama was elected in the fall of 2008 several publications reached out to me to write about investments that would be “hot” and those that would be “not” with the new administration. The suggestion was that solar and other green technologies would be places that would be “hot.”

It was tempting at the time to put solar and other green technologies into the “hot” column because everyone knew that the Democrats were going to throw money at the “green” job industry. 

In fact, the Western states of Colorado, Arizona, New Mexico and Nevada- largely controlled by Democrats- were already throwing money at solar companies touting the jobs that would be created in the green energy field.

John Ransom

John Ransom’s writings on politics and finance have appeared in the Los Angeles Business Journal, the Colorado Statesman, Pajamas Media and Registered Rep Magazine amongst others. Until 9/11, Ransom worked primarily in finance as an investment executive for NYSE member firm Raymond James and Associates, JW Charles and as a new business development executive at Mutual Service Corporation. He lives in San Diego. You can follow him on twitter @bamransom.

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