Extension cord and power strip safety
This is one of the biggest problem with power strips (surge protectors)...


Overload!

The average person does not think about how much power each device is drawing, or how much the system can handle, they just see an open outlet and plug stuff in.  If they can't find an open outlet... Oh yeah! they make adapters for that!  I mean they sell the adapters, so they must be safe... Right?

If your power strips look like this (or worse), you better at least be checking the batteries in that smoke alarm (which is hopefully not plugged into this power strip too).

If you are using the power strip (or extension cord) properly (one plug per outlet, no adapters, no daisy chaining) and you inspect the power strip for damage (wear &amp; tear) regularly, you should not have much to fear.

Another thing to look at when using a power strip or extension cord, is the size of the wire and the voltage and amperage ratings.  If you are using things like electric heaters, power tools, vacuums, etc., make sure the wire (extension cord/power strip) is the proper size to handle the above average load of these types of devices. Overloaded wire can heat up quickly and cause a fire.

Basically if you use common sense, inspect the cables for obvious damage and/or wear &amp; tear regularly, and use the cables for their intended purpose, you should have no problems using extension cords and/or power strips.

Here is some interesting stuff from The Office of Compliance about 
Power Strips and Dangerous Daisy Chains.


  Problems:
  
  OSHA regulations require that conductors  and  electrical  equipment 
  be  used  in  accordance with the conditions under which  they are
  approved by a recognized testing  organization (29 CFR 1910.303(a)). 
  Most  power strips are approved for providing power to a maximum of four or
  six individual items;  however,  when  multiple  power  strips  are 
  interconnected, the one directly connected  to  the  building  outlet 
  is  often  supplying  power  to  far  more  than  the  approved 
  number. This electrical current overload can  result in a fire or can
  cause a circuit breaker  to  trip, deenergizing computers and other 
  equipment throughout the area. The risk is  magnified when another
  outlet in the same  wall or floor receptacle is also overloaded in  a
  similar fashion.  When other outlets on  the same circuit are also
  overloaded, the risk  increases.
  
  Extension  cords  are  sometimes  used  to 
  energize  power  strips  in  locations  far 
  from outlets.  Because electrical resistance 
  increases with increased power cord length,
  interconnecting  cords  increases  the  total 
  resistance  and  resultant  heat  generation. 
  This creates an additional risk of equipment
  failure and fire, particularly when paper and 
  other combustible materials are in contact 
  with  the  wires.  Additionally,  OSHA’s 
  regulations allow extension cords to be used 
  only as temporary wiring for up to 90 days.
  Unfortunately,once in place, extension cords 
  tend to become permanent wiring and a fire 
  hazard.
  
  Solutions:
  
  Several safe solutions exist.  In many cases, a 
  power strip energized by an extension cord or 
  another power strip can simply be replaced by 
  a power strip with a power cord of adequate
  length to reach an outlet.  Other 
  times, use of a power strip that is better able 
  to accommodate bulkier transformer plugs 
  solves the problem. 
  Several factors should be considered when 
  selecting an appropriate surge protector. Since 
  models vary in the amount of current that 
  they are rated to safely carry, it is important 
  to consider  the amperage  requirements of 
  the devices to be energized. Models vary in 
  length of power cord, typically ranging from 
  three to 15 feet. Choose one whose length is 
  most appropriate for reaching the intended 
  room outlet. Avoid having too much excess 
  cord, and make sure the surge protector is set 
  on its base. Some have swivel plugs which 
  makes them easier to connect to the outlet,
  and helps to protect the plug and cord from
  damage.  Check  each  surge  protector  to 
  make sure it is in good condition for use. 
  
  Only power strips equipped with internal fuses are acceptable as permanent wiring.  Those
  lacking  these  fuses are equivalent to extension cords, and  therefore may not be used as
  permanent wiring.  When a power strip is installed, care must be taken to ensure that it is 
  not suspended in mid-air by its power cord or cords plugged into it, resulting in excessive 
  stress on electrical connections. 




The National Electrical Code (NEC) has a whole article devoted to flexible cords and cables, one of the more applicable sections in this case would be 400.8.  


  2008 National Electrical Code
  
  ARTICLE 400 Flexible Cords and Cables
  
  400.8 Uses Not Permitted. Unless specifically permitted in 400.7, flexible cords and cables shall not be used for the following:
  (1) As a substitute for the fixed wiring of a structure
  (2) Where run through holes in walls, structural ceilings, suspended ceilings, dropped ceilings, or floors
  (3) Where run through doorways, windows, or similar openings
  (4) Where attached to building surfaces
  *Exception to (4): Flexible cord and cable shall be permitted to be attached to building surfaces in accordance with the provisions of 368.56(B)**
  (5) Where concealed by walls, floors, or ceilings or located above suspended or dropped ceilings
  (6) Where installed in raceways, except as otherwise permitted in this Code
  (7) Where subject to physical damage
  
  *368.56(B) Cord and Cable Assemblies. Suitable cord and cable assemblies approved for extra-hard usage or hard usage and listed bus drop cable shall be permitted as branches from busways for the connection of portable equipment or the connection of stationary equipment to facilitate their interchange in accordance with 400.7 and 400.8 and the following conditions:
  (1) The cord or cable shall be attached to the building by an approved means.
  (2) The length of the cord or cable from a busway plug-in device to a suitable tension take-up support device shall not exceed 1.8 m (6 ft).
  (3) The cord and cable shall be installed as a vertical riser from the tension take-up support device to the equipment served.
  (4) Strain relief cable grips shall be provided for the cord or cable at the busway plug-in device and equipment terminations.


400.8(1) As a substitute for the fixed wiring of a structure.



400.8(2) Where run through holes in walls, structural ceilings, suspended ceilings, dropped ceilings, or floors.



400.8(3) Where run through doorways, windows, or similar openings.



400.8(4) Where attached to building surfaces.



400.8(5) Where concealed by walls, floors, or ceilings or located above suspended or dropped ceilings.



400.8(6)  Where installed in raceways, except as otherwise permitted in this Code



400.8(7) Where subject to physical damage