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Railroad to make shift to natural gas locomotives
The freight railroad company BNSF made a big announcement today. It’s going to do a little experiment and switch from diesel to natural gas to power its locomotives. BNSF happens to be owned by Warren Buffett’s Berkshire Hathaway. Buffett is betting big on natural gas. If this latest natural gas play works, it could mean big profits and big changes for the entire rail industry.
BNSF considered using natural gas in its locomotives back in the '80s, but there is a big difference between then and now. Natural gas is way cheaper than the diesel today.
“Something has to take advantage of that economic arbitrage,” says energy analyst David Bellman. He points out that BNSF is doing exactly that -- taking advantage of the low-cost of natural gas.
But the transition won’t be simple. Locomotives will have to be redesigned, and they will need more fuel storage and new fueling stations. All that infrastructure is going to be expensive. But according to energy expert Amy Jaffe, it’s worth it for Buffett and Berkshire Hathaway.
Even with the cost of converting vehicles, Jaffe says, “You can make money almost overnight.”
Once the conversion is complete, BNSF trains will have to refuel less often than diesel trains, they will be cheaper to run and they will pollute less. Jaffe expects more railroads to make the switch.
That could put the entire railroad industry on a new track. Companies like GE and Caterpillar, which are designing the new liquid natural gas locomotives, would benefit from the conversion. Those benefits could spread to gas suppliers.
“You have some very big players” says Jaffe. “Shell has entered this market, BP is looking at this market, Conoco Phillips.”
Of course, all that demand for natural gas will make the price go up and reduce some of its advantage over diesel. But most analysts expect natural gas to stay below the cost of diesel for quite a while. And a rise in demand coupled with a little price increse probably wouldn’t bother Warren Buffett, who has invested billions in natural gas.
In the end, he could make out like a train bandit.
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Alvin Lee Is Going Home: 'Ten Years After' Guitarist Dies
His fiery performance at Woodstock is legendary. The band would go on to have a hit with "I'd Love to Change the World."
Alvin Lee Is Going Home: 'Ten Years After' Guitarist Dies
His fiery performance at Woodstock is legendary. The band would go on to have a hit with "I'd Love to Change the World."
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Guys, Your Colorblindness Might Be Messing With Kenya's Elections
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When negative is positive: Freakonomics on feedback
"You're doing great."
"Keep up the good work."
"What were you thinking when you did that?"
Giving feedback can be an awkward experience. Those who give it out -- employers, parents, teachers -- can fear the reaction they'll get. Those who get it can feel embarrassed or unmotivated.
But is there a better way to understand the whole idea of feedback? Some new research has insights into its value and shows that many people want to hear about what they're doing wrong.
The research comes from Ayelet Fishbach, a professor of behavioral science and marketing at the University of Chicago's Booth School of Business, and Stacey R. Finkelstein, an assistant professor of management at Columbia's Mailman School of Public Health.
“The more a person is committed to a goal, and by that I mean the more someone thinks that they absolutely have to do it, they like doing it, it’s important for them to do it, the more negative compared with positive feedback will be efficient,” says Fishbach.
Their work shows that positive feedback is best used to increase someone's commitment to a goal. But the more a person works toward that goal, they less they value positive feedback. It turns out that they begin to need a sense of where they're falling short.
Kai Ryssdal: Time now for a little Freakonomics Radio. It’s that moment every couple of weeks we talk to Stephen Dubner, the coauthor of the books and the blog of the same name. The hidden side of everything is what he does. Dubner, welcome back.
Stephen J. Dubner: Hey Kai, thanks for having me back. You know last month, you know, we New Yorkers lost a legend, former congressman and mayor, Ed Koch.
Ryssdal: Oh yeah, yeah, yeah.
Dubner: Now, Koch was unique is a few ways, including the fact that he actively solicited feedback from the public.
Ed Koch: Serendipitously I said on one occasion, “I’m Ed Koch, I’m your congressman, how am I doing?” People stopped to tell me, and I knew I was on to something.
Dubner: So Kai, this got me to thinking about feedback generally.
Ryssdal: Okay.
Dubner: It strikes me that a lot of people say they want feedback, but I’m not so sure they really do, especially if there’s a chance that it will be negative feedback.
Ryssdal: Yeah, no, who wants to be told they’re doing something wrong? Forget it.
Dubner: That’s probably right. But the fact is if you really want to get better at something, it’s hard to do that without feedback, whether it’s your job, or a sport, or schoolwork. So I wanted to know the latest academic thinking on feedback.
Ryssdal: All right, well give it up. What’d you find?
Dubner: Well let’s start with the fact that there are obviously at least two different kinds of feedback, right: positive and negative. As it turns out, they each produce their own benefits. Positive feedback is really helpful when you’re trying to increase someone’s commitment. So let’s say, you know, someone new to a job or a project. Here’s Stacey Finkelstein, a Columbia management professor who’s been studying feedback.
Stacey Finkelstein: For these people, positive feedback is most motivating. It’s what signals that there’s value to what they’re doing, they like what they’re doing, or that they might achieve their goal at some point.
Dubner: But here’s the thing Kai, once somebody really buys into that goal, positive feedback has diminishing returns. So if you’re looking for actually improvement you’ve got to start going negative. Okay? Here is Heidi Grant Halvorson, she’s a psychologist also at Columbia.
Ryssdal: This seems fraught.
Heidi Grant Halvorson: Look, doling out negative feedback is not fun. It’s embarrassing. We feel terrible. We feel guilty. So we love hearing, ‘hey, maybe I don’t have to give negative feedback.’ ‘Maybe I can just say positive things!’ ‘If I just keep saying positive things, then somehow this person will work to their fullest potential and everything will turn out fine. ’ And that just turns out to not be the case.”
Ryssdal: Well, wait. How do you know that’s not the case?
Dubner: OK, well I’ll tell you about the research that Stacey Finkelstein and co-author, Ayelet Fishbach, at the University of Chicago did. They ran a series of experiments with people in a variety of realms, some novices and some experts. And granted, these are only experiments, but this is the best they could do for now. And they wanted to see how different people handled feedback at different stages of their expertise. And the results argue quite strongly that novices really need the positive feedback, but that experts just start to tune it out. So here’s Fishbach.
Ayelet Fishbach: The more a person is committed to a goal, the more negative compared with positive feedback will be efficient.
Ryssdal: But Dubner, people are fragile, man! You don’t want to hurt people’s feelings. I come out of the studio, and someone says, “man that interview stunk!” That hurts my feelings!
Dubner: Well, I guess there are two ways to look at this: you can either look at trying to make people happy or trying to make people better. If you want to make people happy, you know...
Ryssdal: That’s so cold.
Dubner: Well, maybe, look, if you don’t want to get better, that’s your prerogative, right? If you do, then it’s critical feedback that’s going to help get you there. Now, I’m not saying you should eliminate positive feedback or that you should, you know, deliver the negative feedback in a way that makes people weep.
Ryssdal: Well, give me a for instance here, would you?
Dubner: Oh, I’m so glad you ask, Kai. So as you know, I’m a really big fan of Marketplace. I think you do a great job as a host.
Ryssdal: Uh huh, yeah, yeah, yeah, blah, blah, blah.
Dubner: I would like to look at a couple recent examples of your work. I’ve noticed you are smooth as silk on most domestic matters. But I think you might want to think about practicing your foreign pronunciations a bit more before you get on the air. Here, listen to this one, Kai.
Ryssdal: All right.
Ryssdal: If you want to know where those reactors built like Fumu…Fukushima rather, that Alex mentioned...
Ryssdal: You are so fired! All right, we’re going to turn off your microphone, we’re done.
Dubner: Hang on. There’s another.
Ryssdal: No there’s not.
Ryssdal: The prospect of a quarter of a million new Romanian-Bulgarians. Romanians, rather, and Bulgarians.
Ryssdal: What are “Romanian Bulgarians”?
Dubner: You remember them? And here’s a little something else I think you could maybe improve on, Kai. This is interesting, this is kind of a trademark phrase of yours I’ve found.
Ryssdal: A final thought on the way out that goes like this...This final note on the way out in which Boris Johnson, the mayor of The City of London...This final note as we leave off today, the end of the beginning...
Dubner: You’re sensing a pattern here I gather.
Ryssdal: I hate you.
Ryssdal: This final note on the way out, we did a thing a couple of months ago...
Ryssdal: You know what? This may be your final note pal.
Dubner: Possibly, but before I go let me offer the constructive feedback.
Ryssdal: There’s more?
Dubner: No, here’s the thing, I have nothing against the “final note” or “on the way out,” but together, they’re just redundant. So what about cutting one of them, and just think, Kai. Just think of all the extra time you’ll save over the course of a year, maybe enough time to run an extra couple Freakonomics Radio segments.
Ryssdal: Or five minutes every two weeks that we don’t have to have you on. How about that? Would that be all right?
Dubner: Please no! Please have me back!
Ryssdal: Stephen Duber, Freakonomics.com is his website. We’ll see you.
Dubner: I hope so.
Ryssdal: Maybe, I don’t know.
Guitarist Alvin Lee dies at 68
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