The Rush To Electric Cars Will Replace Oil Barons With Lithium Dictators

In the latest installment of the Butterfly Effect we look at how mining the key ingredient in electric cars could end up enriching potential enemies of America, and force another round of innovation to build an even newer kind of battery.

1. Revenge Of The Electric Car

One day in late 2005, after losing yet another bruising political battle to the bean counters inside General Motors, then-vice chairman “Maximum” Bob Lutz heard of a startup called Tesla Motors intending to bring an all-electric sports car to market. Enraged that a bunch of Silicon Valley gearheads could do what he couldn’t, Lutz, in his own words, "just lost it." He rallied his fellow car guys within GM to develop the prototype of what became the Chevrolet Volt--the “moon shot” justifying the company’s survival and the first in a new wave of electric vehicles just beginning to break on dealers’ showrooms. And while the Volt uses just a tiny bit of gas, it's still powered by a material that is in short supply and controlled by some of the most hard to deal with governments in the world. Its lithium battery might just create a new geopolitical calculus that is just as problematic as the gas-based one electric cars are supposed to extricate us from.

2. Peak Lithium?

A month before the Volt announcement, an energy analyst named William Tahil published a paper titled “The Trouble With Lithium.” There simply isn’t enough cheap lithium to go around, he argued, and 80% of the world’s accessible reserves are located in the so-called “Lithium Triangle” of the Chilean, Argentine, and Bolivian Andes (pictured above). “If the world was to exchange oil for Li-ion based battery propulsion,” Tahil wrote, “South America would become the new Middle East. Bolivia would become far more of a focus of world attention than Saudi Arabia ever was.” Even then, we would run out of lithium long before we’d finished electrifying our cars.

Tahil’s paper immediately came under fire for his overly pessimistic predictions. Researchers at the Argonne National Laboratory outside Chicago--a hotbed of lithium battery innovation--estimate worldwide demand will eventually top out at 8 million metric tons, total. (The Volt’s massive battery array only requires about nine pounds.) That’s well within the U.S. Geological Survey’s conservative estimate of 12 million tons of recoverable reserves. As refining improves and new deposits are discovered, that figure will only go up. And unlike oil, lithium can be recycled; once you get it out of the ground, it’s yours.

3. From Petro-Dictators To Electro-Dictators?

Fortunately for GM and Toyota, Chile’s and Argentina’s lithium deposits are open for business. But the largest lies across the border in Bolivia, containing anywhere from 9 million (the official U.S. estimate) to a credulity-straining 100 million tons of lithium. Bolivia’s president Evo Morales (left) is no friend of the U.S., however; he pals around with Venezuela’s Hugo Chavez and Iranian president Mahmoud Ahmadinejad. He once expelled the U.S. ambassador and likes to end speeches with the rallying cry, “Death to the Yankees!”

4. If It's Not Lithium, It's Something Else

There are two alternatives to entrusting the bulk of America’s lithium supply to Chile, Bolivia, or even Afghanistan--discover new sources closer to home, or innovate our way out. In Bottled Lightning, author Seth Fletcher pays a visit to Western Lithium’s stake in the Nevada foothills where it hopes to mine lithium from clay deposits. A spin-off from Lawrence Livermore National Laboratory called Simbol Mining believes it can meet nearly a fifth of the world’s needs by mining California’s (chemical-rich) Salton Sea.

The other option is to treat Li-ion batteries as a bridge technology on the way to something lighter, cheaper, and better. “We need something with the energy density of gasoline,” says LeVine. “We need the new technology--sulfur-air, zinc-air, lithium-air.” Other teams are working on a battery made of molten melts and salts.

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Google launches Google+, a quasi-Facebook competitor

NEW YORK (CNNMoney) -- Google on Tuesday unveiled Google+, yet another attempt by the search giant to overcome its past miscues in the social networking space.

More people visit Google's network of websites than Facebook each month, but Facebook is killing the search company in categories that advertisers care most about: Time spent and pages viewed. Users spent 62% more time on Facebook than on Google last month, and viewed more than twice the number of pages on Facebook as they did on Google, according to comScore.

Google's latest solution to this growing trend is Google+, a new social network that tries to out-Facebook Facebook. On Facebook, people are either "friends" or not. Google+ makes that distinction more fluid, letting users group their contacts into smaller categories, such as relatives, co-workers, or members of a yoga class. Information can be shared selectively with each group.

"The subtlety and substance of real-world interactions are lost in the rigidness of our online tools," said Vic Gundotra, Google's senior vice president of social, in a blog post. "In this basic, human way, online sharing is awkward. Even broken. And we aim to fix it."

Though Google often denies that Facebook is the company's primary competitor, sources with knowledge of the project say that Google+ was known internally as "Googbook." Google devoted 300 people to the team.

Unlike Google's previous social attempts, such Orkut and Buzz -- which had big, bold launches and are largely considered failures -- Google is moving slowly and cautiously with Google+. It has only been launched for a small group of users, and others need to be invited to the service to use it.

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Why Google Health Really Failed?

As reported on TechCrunch, Google shut down its medical records and health data platform. Since then, there’s been a lot of bits spilled offering explanations, but they all missed the most critical item. Money. Or in the language of healthcare—Reimbursement. I explain more below regarding why Google Health was doomed to fail in light of the legacy reimbursement model.

First, let’s recap some of the explanations offered up so far. These are all valid but miss the biggest point.

Adam Bosworth, who originally ran Google Health gave one reason: It's Not Social. That’s true if one wants to create a weight management program or is simply interested in fitness-minded folks. Clearly that is important given the obesity epidemic, however there’s vast swaths of healthcare where being “social” isn’t appropriate or applicable in a doctor-patient relationship. In other words, being social is necessary but not sufficient to transform healthcare.

As much as we’d like to think it isn’t the case, the fundamental driver of most (not all) behavior in healthcare is the reimbursement scheme. As I described in an earlier piece on the “Do it Yourself Health Reform” movement, I spent much of my time as a consultant in the Patient Accounting departments of heatlhcare providers. The legacy reimbursement scheme can only be described as a Gordian Knot designed by Rube Goldberg.

I expanded on the insidious effects of the reimbursement model in the U.S. in my overview of The Most Important Important Organization in Silicon Valley No One Has Heard About. For those who would like to be optimistic about the reimbursement model changing, read about Health Insurance’s Bunker Buster. In the meantime, it’s critical to understand the current reimbursement model to understand why Google Health failed to transform the landscape.

The problem for a company like Google or Microsoft is their success is measured in the tens of millions. Those kinds of numbers are only present in the legacy reimbursement model. Frankly, Google could have done all the right things, but if the reimbursement model doesn’t change Personal Health Records will remain irrelevant for most healthcare providers. At best, we’re seeing Electronic Health Record vendors release so-called Patient Portals that are often driven more by a marketing objective than a clinical objective. Further, they are flawed in that they are a one-way broadcast of the silo’ed information from only one healthcare provider.

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Madoff trustee wants billions more from JPMorgan

NEW YORK (CNNMoney) -- The trustee in the Bernie Madoff case filed an amended complaint against JPMorgan Chase on Friday, upping the damages sought from $5.4 billion to $19 billion for the bank's alleged role in the Ponzi scheme.

Irving Picard, the trustee, had previously filed a complaint that sought to recover nearly $1 billion in fees and profits and an additional $5.4 billion in damages stemming from the bank's long stint as Madoff's banker.

But now Picard is alleging that JPMorgan Chase bankers played a larger role, and knowingly watched the fraud unfold without taking action.

"As alleged in the amended complaint, [JPMorgan Chase] not only should have known that a fraud was being perpetrated, they did know," David Sheehan, Picard's lawyer and a partner at Baker & Hostetler, said in a statement.

The trustee has sued hundreds of Madoff investors, including firms, individuals and the owners of the New York Mets baseball team, for profiting from their investments in his firm.

In February, JPMorgan responded to Picard's initial complaint, accusing the trustee of overstepping his bounds.

"JPMorgan believes that the Trustee is entirely wrong in asserting that JPMorgan violated any federal statutes or regulations," the bank's lawyer John Savarese said in court filing.

JPMorgan did not immediately respond to requests for comment on Friday.

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Facebook With Skype? New Windows Client Adds IM Support

In 2010, Skype debuted new Windows software with deep Facebook integration, adding the ability to use the client to monitor your Facebook news feed and post, like or comment on status updates straight from your desktop.

This morning, the company (which has been acquired by Microsoft in the meantime) released Skype for Windows 5.5 Beta, which now also lets you have instant messaging conversations with Facebook friends directly from the desktop client.

Aside from support for Facebook Chat, the client also comes with a dedicated contacts tab that filters your Skype contact list down to just your Facebook friends.

Other enhancements include a new ‘Call Control’ toolbar, improvements to the saving of a phone number in the “Call Phones” section and a number of UI changes.

Skype says the final version of the client will be released ‘soon’.

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Homeless Man Learns He's Rich

SALT LAKE CITY -- A private investigator says he has tracked down a homeless Utah man and delivered some good news: He's inherited a lot of money.

David Lundberg said he found Max Melitzer pushing a shopping cart filled with personal possessions in a Salt Lake City park Saturday afternoon.

Lundberg declined to disclose how much money Melitzer will be receiving, but said the man's brother who died of cancer last year left him a "significant" amount in his will.

"He'll no longer be living on the street or in abandoned storage sheds," he told The Associated Press. "He'll be able to have a normal life, and be able to have a home, provide for himself, and purchase clothing, food and health care."

The story about Lundberg's two-month search for Lundberg has been reported by the Deseret News and KSL of Salt Lake City.

Lundberg said he was hired by the family's New York law firm to locate Melitzer, and some family members plan to meet Melitzer next week in Salt Lake City. He declined to identify them.

Melitzer's family wishes to remain private, and lawyers are deferring questions to Lundberg.

The investigator said he broke the news to Melitzer while they were sitting on a bench at Pioneer Park. While Lundberg said he didn't tell Melitzer how much money he was inheriting, the man was excited.

"He's still in shock. This came out of nowhere," Lundberg said. "He's a really mellow guy in his 60s, very sweet and more articulate than I thought for a man in his position."

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Google Acquires Ad Optimization Firm Admeld for $400 MM

In an apparent move to bolster its own ad sales efforts and provide services to large publishers, Google has reportedly made a $400 million purchase of Admeld, a company that builds technology to help ad sellers maximize the value of their inventory. Admeld has relationships with the Weather Channel, IDG TechNetwork, and large newspaper companies like The New York Times Company, Hearst, Tribune and Gannett.

The TechCrunch story reporting the acquisition cites “multiple sources.” Google representatives said the company doesn’t respond to “rumor or speculation.”

Admeld was founded in 2007 and has spent the last several years building and launching its technology both in the U.S. and in Europe. The company’s systems for publishers tie into various demand-side platforms and ad networks, giving publishers more control over how their inventory is sold. Admeld also provides publishers with data about their audiences, helping them to sell more effectively. Admeld is based in New York City and has offices in San Francisco, London, Berlin, and Toronto.

The acquisition ties in well to Google’s DoubleClick operations, serving as a publisher-focused companion to the advertiser-oriented DoubleClick Ad Exchange. The company has also developed tools for managing mobile inventory, which will presumably assist Google with AdMob. Though the acquisition of a company like this raises questions of how Google would work with competitors in the ad sales arena, the company has demonstrated an ability to navigate these waters with DoubleClick.

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Tiger Woods to Skip U.S. Open

JACKSONVILLE, Fla. (AP) — Tiger Woods pulled out of the U.S. Open on Tuesday because of lingering issues with his left leg, leaving him uncertain how soon he can resume his pursuit of Jack Nicklaus' record for major titles.

It will be the first time Woods has missed the U.S. Open since 1994, when he had just graduated high school.

"I am extremely disappointed that I won't be playing in the U.S. Open, but it's time for me to listen to my doctors and focus on the future," Woods said on his website. "I was hopeful that I could play, but if I did, I risk further damage to my left leg. My knee and Achilles tendon are not fully healed."

Woods said he hoped to be ready for the AT&T National, which starts June 30 at Aronomink, and the next two majors. Then again, he said two weeks ago he would do everything possible to be ready for the U.S. Open, which is far more significant.

"We're very disappointed that he won't be playing in the National Open," USGA executive director Mike Davis said, whom Woods called Tuesday morning. "He certainly brings excitement to the event. He'll be missed, but the U.S. Open will go on. The event is bigger than one player, but he certainly will be missed."

The U.S. Open starts June 16 at Congressional, where Woods won the AT&T National two years ago and tied for 19th when the U.S. Open was last played there in 1997.

He hasn't won since the 2009 Australian Masters, a stretch of 22 tournaments. He not only lost his No. 1 ranking late last year, he has plunged to No. 15 in the world, his lowest spot in the ranking since the spring of 1997.

Woods announced his decision on Twitter: "Not playing in US Open. Very disappointed. Short-term frustration for long-term gain."

The Masters is now the only major Woods has played every year since turning pro. He was recovering from knee surgery in 2008 and did not play the British Open and PGA Championship.

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