DrumBeat: March 13, 2008
Posted by Leanan on March 13, 2008 - 9:13am
The Peak Oil Crisis: The Last Spiral?
Events are moving faster and faster. Equity markets and the dollar are dropping. Oil, gas, diesel and commodities are surging as the investment of last resort.Margin calls are endangering the financial system. Real estate values and markets are falling. Exotic debt obligations are turning worthless by the billions. Central bankers have started the printing presses and are injecting unprecedented billions of “liquidity” into their banking systems in what so far seems to be a futile effort.
One by one, however, talking heads appear on the business channels to assure us that all will be well by the “third quarter” and that this is a lifetime opportunity to buy equities which will never again be a better bargain. In recent days however, some of the tone of optimistic confidence that has obtained for the last eight months has started to darken a bit and some will even confess it might be a little longer before the good times return.
Missing from all this talk is a realistic appreciation of the role of oil in the world’s economy and the role increasing oil prices will play in the coming economic “recovery.” Although oil prices are discussed dozens of times each day, increases are nearly always attributed to a temporary flight of capital from equities into the safety of commodities. Discussions are formulated around the premise that high oil prices may be unpleasant, but are, as yet, a long way from doing real harm to the country. Eight or nine dollar gasoline in Europe is cited as proof that prices can go much higher without disastrous consequences.
Gas, oil rise to records as dollar falls
NEW YORK - Gas and oil prices jumped again to new highs Thursday as the dollar weakened, although crude's advanced limited by fresh evidence of a U.S. economic slowdown....Light sweet crude for April delivery rose 41 cents to settle at a record $110.33 a barrel on the New York Mercantile Exchange Thursday after earlier surging to a new trading record of $111.
Schlesinger: No Energy Security in Sight
James Schlesinger, who was the nation's first secretary of energy, had a grim analysis of the nation's current energy predicament this morning at an energy summit in Washington, D.C., sponsored by the National Academy of Sciences. Schlesinger, now a senior adviser to Lehman Brothers and chairman of the nonprofit engineering organization Mitre, predicted that energy prices would continue to rise and declared that the United States would never see energy independence as long as it depended on the internal combustion engine. Excerpts from his remarks...
Who gets rich off $3 gas - who doesn't
The guy running the service station makes just a few cents, while crude oil producers take the biggest chunk.
Speculation makes oil prices rise
If we lived in a world where oil was a normal commodity, competition would dictate that margins hover just above the cost of production, which is estimated between $20-$30 per barrel on average. At the time of writing, oil is trading around $108 with a one-year high forecast of $141. Regardless of the many reasons consumers are given, billions in profits for oil producers are obvious.
Pirate Attacks On the Rise in Nigerian Waters
Pirate attacks in the waters of Africa's largest oil producer, Nigeria, have surged in recent weeks, linked to a decline in general security in the southern oil-producing region. A leading international worker's union wants the waters to be declared a war zone.
Australia: State puts brakes on petrol bikes
IN a world of rising fuel prices and climate change awareness, these petrol-powered bicycles are seen by some as the way of the future.But not, it appears, by the State Government which has outlawed them on roads.
Canada: Please buy our dirty oil
CANADIANS like to think that although they are the junior partner in their trade relations with the United States, the 174 billion barrels of proven reserves in the oil sands of Alberta provide a powerful ace up their sleeve in any dealings with their energy-hungry neighbour. That belief has now been shaken by an American law that appears to prohibit American government agencies from buying crude produced in the oil sands of the western province.
Bruce Power sees four reactors in Alberta
OTTAWA — Bruce Power says it wants to build as many as four nuclear reactors in northwestern Alberta to meet the province's growing electricity needs — and it is not committed to choosing Atomic Energy of Canada Ltd.'s ACR design.
Kazakhstan wants Russian giant Gazprom to pay more for the transit of Turkmen and Uzbek gas in 2009 when the latter states start charging more for their gas, the head of the Kazakh state energy firm said today.Gazprom said last week it had agreed to buy gas from Uzbekistan, Kazakhstan and Turkmenistan at prices close to that it charges European customers, minus transport and other costs.
"If the gas we buy becomes more expensive then, logically, the tariff will also grow," Uzakbai Karabalin, head of state oil and gas firm KazMunaiGas told Reuters.
S. Africa's Sapref, Engen refineries hit by storm
JOHANNESBURG (Reuters) - BP Plc and Royal Dutch Shell Plc said on Thursday their South African Sapref oil refinery, the largest in the country, had shut down after lighting hit the facility on Tuesday.BP South Africa spokesman Sam Mupanemunda said boilers in the utility section of the 180,000 barrel-a-day refinery had tripped, automatically shutting down the facility in the port city of Durban on Wednesday.
How plastics industry battles bans on its bags
When San Francisco became the first U.S. city to prohibit large grocery stores and pharmacies from distributing disposable plastic bags in March 2007, it appeared to have sparked a trend. At least a dozen other cities, counties and states were soon considering proposals to ban or severely restrict distribution of what many environmentalists consider a wasteful and harmful product.The plastics industry had no intention of allowing the San Francisco model to spread without a fight, though. It quickly and quietly joined with retailers and other business interests and launched a successful counterattack, using lobbying muscle to quash proposed bans.
Despite the free fall in housing prices nationwide, green homes are still red hot.
Three Ways to Play Money Morning’s Prediction That Oil Prices Will Reach $187 a Barrel
A plummeting greenback, inflationary fears fanned by the U.S. central bank and soaring global demand are combining to fuel a record advance in crude oil prices.But the market madness of recent days is just the start. Crude oil prices will hit $187 a barrel within 36 months, translating into gasoline prices of more than $6 a gallon, and giving investors one of their biggest profit opportunities in decades, Money Morning Investment Director Keith Fitz-Gerald predicts.
Let us venture into a political no-go zone and say that, at some point in the not too distant future, there is a bitter pill that we will need to swallow -- and we are getting just a foretaste with the current energy crisis. In a nutshell, our global growth-based economic model is fundamentally unsustainable.This is not a new idea -- it dates back to the early 1970s. At that time there was much debate around energy and sustainability, coupled with a search for alternatives. One seminal work published in 1972 was The Limits to Growth, commissioned by The Club of Rome.
IEA to hold oil price talks with experts
"The IEA is holding a round table on oil price formation on Monday 17 March," at its headquarters, the IEA said in an email."The meeting is part of ongoing work at the IEA to understand the complex process of price formation," it said, adding the meeting would be closed to the public.
Canada: Gas tax could help combat our oil dependency
With fuel taxes in Alberta already low at only 20¢ per litre, completely eliminating the gas tax couldn’t even bring it below $1.20 per litre. Oil companies would have no incentive to raise production even though cheaper gas means more driving, so the price of gas goes right back up—except now it’s all going to the oil companies.
If you still have a car with a gasoline engine you're eventually going to pay $10 per gallon if you want to drive anywhere. It's as simple as that. Take heart, E-85 will probably only be $9.60!
Stop complaining about gas prices!
We will never see cheap gas prices ever again - that bears repeating - NEVER AGAIN. All those quaint little anecdotes from my dad about how gas was 25 cents a gallon back in the day enabling him to fill up his big ol' 1964 Chevy Impala for under $5 are ancient history. People are laying blame everywhere for the $1.05-plus-per-litre prices. We're running out of oil, they say. They point to emerging markets like India and China and blame them for taking all that precious black goo. Or maybe the government is too greedy, taking half of what you pay at the pump in taxes.I have a different theory - good old-fashioned human greed prompted by Hurricane Katrina. A little human inactivity helped the situation nicely as well.
We need new transportation paradigm
Consider the following bad news for travel by automobile:The Department of Energy forecasts that gasoline prices are expected to stay over $3 for two years. Beyond that, a Governmental Accounting Office study acknowledges that eventually world production of oil will fall behind demand (so-called peak oil), potentially leading to economic disruption. The only question is timing, and the GAO acknowledges it could happen soon.
Venezuela Plans New 'Sudden Gains' Oil Tax Soon
Venezuela plans a new tax on foreign oil companies of 20%-25% on what the government deems to be "sudden gains" from strong fluctuations in world oil prices, a lawmaker said Wednesday."The tax will be anywhere between 20% and 25% of what we deem sudden gains," lawmaker Iroshima Bravo told Dow Jones Newswires. "We're studying various examples of the tax, and this should be ready soon."
Thailand: Oil subsidies are only good in the short term
Poonpirom Liptapanlop, the Energy Minister, has sent a strong signal that it is time for Thai people to learn to live with the era of high oil prices. The oil prices are beyond anybody's control, as oil is the most important global commodity. Although the government may be able to provide some relief, at the end of the day, the Thai people must learn to cope with the high prices on their own. Most analysts now believe that oil prices won't fall again.
Pakistan: Fuel crisis feared during May, June
ISLAMABAD: Pakistan may face a fuel crisis in the coming months as the oil marketing companies (OMCs) have informed the incumbent regime about their inability to book import orders for the POL products due to financial constraints, a senior government official told The News."The government owes Rs 61 billion to the OMCs against the price differential claim (PDC) that has been accumulated since long. The petroleum ministry time and again asked the finance ministry to release the amount piled up against the PDC to the OMCs so that they could maintain oil reserves in the country and ensure fuel supply chain, but the finance ministry is still unmoved."
PetroVietnam imports gas to plug shortage
Vietnam Oil & Gas Group plans to import natural gas in the next decade to meet a widening shortage of the fuel, an official said.“We may start gas imports by 2015,’’ Bui Minh Tien, vice president of PetroVietnam Gas Corp., a unit of the state-run group, said in Bangkok.
“Before that, we have to speed up domestic gas projects. We have a shortage because of demand from power plants and industries.”
Conoco Could Reach Deal With Venezuela This Year
ConocoPhillips could reach a settlement with Venezuela over its nationalized assets some time this year, Chief Executive Jim Mulva said Wednesday, adding that the oil giant has a normal business relationship with the South American country."We continue to have routine meetings where we negotiate the issues," Mulva told Dow Jones Newswires on the sidelines of the company's annual analyst meeting. "We hope we can reach an amicable settlement sometime this year."
Backgrounder: Oil resources in China
BEIJING, March 13 (Xinhua) -- China has announced a creation of a high-level body to integrate its energy management supervision and policies, functions that are currently dispersed among many government agencies.Below is basic information about oil resources in China.
Jeremy Leggett: A load of hot air
A "green budget" should have at its heart the green-ness of buildings. More than half our national greenhouse emissions come directly and indirectly from buildings. Most of the gas we will have to import will be used to heat and light buildings. The thousands of fuel-impoverished people who die each year of hypothermia shiver to death in un-insulated and under-heated buildings.
At a price of about $2,500, this four-door city car from India costs about the same as a decent three-night stay at a modest Geneva hotel. On the floor of the Palexpo exhibition centre near the airport, a funny-looking, little, four-door, yellow Nano was within a stone's throw of a $2.4-million Bugatti Veyron special edition (made in co-operation with luxury good maker Hermès) and Alfa Romeo's $200,000 8C Competizione.
'Disposable' nuclear reactors raise security fears
A US government-led plan to design small nuclear reactors for deployment in developing countries is continuing despite ongoing fears about security and proliferation risks.
Fomenting a Revolution in Small Steps
At the World Future Energy Summit (WFES) in Abu Dhabi at the beginning of 2008, experts from business and politics alike were unanimous: We are on the threshold of an era in which energy production will produce significantly fewer carbon dioxide emissions. But this revolution will take time - too much, say the critics.
John Michael Greer: Pieces of the puzzle
One of the continuing disputes on the end of the peak oil community concerned with agriculture is whether farming will continue to use tractors and the like, or whether draft horses will prove to be more viable. Both sides have good arguments. On the one hand, a large farm running tractors on homegrown biodiesel can keep them fueled by devoting 10% or so of its acreage to oilseed crops, while it takes around 30% of acreage to produce fodder for draft horses to provide the same amount of power. On the other, you don’t need a factory or its substantial inputs of energy and resources to manufacture horses – they do it themselves, with noticeable enthusiasm and no tools other than the ones nature gave them – and a properly fed horse also produces large amounts of excellent organic fertilizer, a significant value that tractors don’t provide.Which is the best option? That depends on a galaxy of factors, few of which can be predicted on the basis of abstract arguments.
Pakistan: Australian role in climate genocide
Pakistan is acutely threatened by climate and sustainability emergency now facing the world. As a mega-delta country, Pakistan is acutely threatened by the 20-metre sea level rise predicted from paleo-climate data by top American climate scientist Dr James Hansen of NASA: “There is strong evidence that the earth is within 1oC of its highest temperature in the past million years. Oxygen isotopes in the deep sea foraminifera reveal that the earth was last 2oC to 3oC warmer [relative to 2,000] around three million years ago, with carbon dioxide levels of perhaps 350 to 450 parts per million. It was a dramatically different planet then, with no Arctic Sea ice in warm seasons and sea level about 25 metres higher, give or take 10 metres.” Pakistan is acutely threatened by declining agricultural output due to global warming and is already threatened by huge increases in world food prices. Checked the price of a roti?According to the UN Genocide Convention, genocide involves the “intent to destroy in whole or in part” and that is precisely what the major climate criminal, greenhouse gas (GHG) polluting countries such as the US, Australia and Canada are doing to increasingly climate-impacted developing world countries. The US, Canada and Australia are among the world’s worst per capita GHG polluting countries and firmly opposed GHG reduction targets at the recent US-wrecked Bali Conference.
EPA sets tougher air-quality standards
WASHINGTON — The smog in more than 300 counties across the USA threatens public health and must be cleaned up to save hundreds or even thousands of lives a year, under new federal rules announced Wednesday.The long list of smog-ridden counties is the result of a new ozone limit the Environmental Protection Agency finalized Wednesday. Under the old standard, set in 1997, 85 counties have air quality considered too poor to breathe.
Cutting trees can fall on wrong side of the law
LAKE TAHOE, Nev. — Douglas Hoffman didn't like trees blocking his view of the Las Vegas Strip. He is now serving a state prison term of up to five years for cutting down more than 500 of them.Patricia Vincent, federal prosecutors say, was annoyed with some pines in her line of sight to scenic Lake Tahoe. A federal grand jury indicted her in January, and she faces trial in April for allegedly arranging to have three trees cut down on U.S. Forest Service land.
Both are part of a trend that has officials in the Lake Tahoe area and elsewhere cracking down — with fines and prison terms — on people willing to cut trees to improve views from their homes or businesses.
So, is there any hope for that a new flood of oil from other sources that would complete the cycle and lead to another generation of low prices? This is the key question in oil markets today — and it’s one that takes us to the heart of the debate between the “cornucopians” (those who suggest there’s lots left to find) and the depletionists, the peak oil types who say that we’ve found all there is.
Oil prices climbed to their highest level ever, reaching over $108 per barrel this week. And Americans are feeling this price spike at the pump, with gasoline averaging $3.22 per gallon. An analysis released by the investment firm Goldman Sachs suggested that oil prices might soar to $200 per barrel. Does this make sense?Not really. Although U.S. crude oil inventories have fallen, gasoline inventories are at their highest since March, 1993, notes Tim Evans, an energy futures analyst at Citigroup's Futures Perspective. World oil production was up 2.5 percent in the first quarter of 2008 over the same period in 2007 while world oil consumption rose by just 2 percent. In fact, world production is projected to be 3.3 percent higher in the second quarter and 4.1 percent higher in the third quarter than the same periods a year ago. On the other hand, world demand is projected to rise by just 1.6 percent over the next six months.
China Raises Fuel Oil Tax to Help Curb Energy Use
(Bloomberg) -- China, the world's third-largest buyer of crude oil, increased the consumption tax on imported fuel oil by more than fourfold on March 5 as part of efforts to limit energy use.The levy rose to 0.1 yuan ($0.014) a liter from 0.03 yuan, the Beijing-based Customs General Administration of China said in a statement on its Web site today. Fuel oil is burned by power plants and processed into gasoline and diesel by privately run refineries.
The average price of diesel fuel has been shooting up even faster than that of gasoline, rising more than 50 cents in barely two months. That is not only squeezing profit out of the trucking business but is also driving up the cost of delivering all kinds of goods to American consumers."People talk about gasoline, but it's diesel that puts the goods on the shelves," said James Hughes, an independent trucker who yesterday was hauling stone in Maryland, from La Plata to Hollywood.
A new 'neighborhood watch': Azeri horsemen guard BP pipeline
BP and other energy companies are under scrutiny for their relations with local communities worldwide for the cost, disruption, and even bloodshed their lucrative pipelines are responsible for. So in recent years they've honed a new formula: invest heavily in the affected communities and try to foster goodwill, neutralize controversy, and hopefully safeguard their multibillion-dollar investments.
Ukraine, Russia resolve gas disagreement
MOSCOW - Russia's natural gas monopoly OAO Gazprom says an agreement has been reached with Ukraine on gas deliveries for the remainder of the year.The agreement announced Thursday appears to cut out at least one of the controversial intermediary companies that had been involved in the trade. The announcement also is likely to fend off anxiety in Western Europe about possible interruptions in Russian gas shipments.
Review: Kunstler's World Made by Hand
As you’d expect from Jim Kunstler there are humorous interchanges and sharp observations, and there is a strong and simple plot. But what makes a far greater impact is the way Kunstler inserts us into the minds of the main characters, so we begin to see the changing world through the eyes of the narrator and others. This world is rural upstate New York in the 2020s. The US and state governments have ceased to be effective, encephalitis and flu epidemics have decimated the population and fuel oil disappeared a decade before the novel opens. Many men are infertile, possibly due to “the bomb.” Those of us familiar with Kunstler’s writing about peak oil will not be disappointed at the depth of the transformation he depicts - vividly.
Big Oil Looks To Renewables For Future Profit
WASHINGTON (Dow Jones)--As crude oil prices soar to new highs, big oil companies are looking beyond the windfall to place bets in the growing alternative energy market.In addition to the allure of a new market, there are worries that record-high oil prices could lead to a backlash plunge in demand. But there are other reasons the petroleum industry wants to plan for a more alternative-energy future. Dwindling access to new oil reserves, which is seen constraining supplies and forcing prices ever skyward, and a global political push to both cut greenhouse gases and shift to cleaner-energy technologies, are driving oil firms to the alternative energy industry.
The most famous conversion in Christian history is that of Paul, who the Bible says "persecuted The [Christian] Way to death," before the "scales fell from his eyes" on the road to Damascus, and he became a Christian himself. Jonathan Merritt, a seminary student with the Southern Baptist Convention (SBC), is familiar with that paradigm. "I was an enemy of the environment," he says. "I approached it with disdain. And then I was sitting in a classroom and I felt like God spoke to me and put this idea in my heart." The idea - encapsulated in the "Southern Baptist Declaration on the Environment and Climate Change" - is a strikingly potent challenge to his denomination's official stance on global warming and to his own previous scorn. Yes, he says with a chuckle, "you could say the scales fell from my eyes."
Farm research network braces for less funds from U.S.
WASHINGTON (Reuters) - A leading agricultural research network is bracing itself for a sharp cut in funding from its top donor, the United States, even as bioenergy, population growth, and climate change pose pivotal challenges for global food production.The U.S. Agency for International Development has warned the Consultative Group on International Agricultural Research, which includes 15 research centers around the world, that it expects to cut the network's core funding by 75 percent this year, the network's director said on Wednesday.
Atlantic's Gulf Stream has huge influence on atmosphere
PARIS (AFP) - The conveyor belt of Atlantic warm water known as the Gulf Stream massively influences the lower layers of the atmosphere, a finding that could shed light on a poorly-understood aspect of global warming, scientists report.
Climate change adds to world clandestine migrant dilemma
DAKAR (AFP) - Migration from the world's poorest nations to the rich West is going to increase and could be speeded up by climate change, a top international agency chief has warned.With growing numbers of poor Africans dying trying to reach Europe on flimsy boats and Asians paying "snakehead" traffickers to get them out of the poverty trap, International Organisation of Migration (IOM) director general Brunson McKinley said wealthy nations need foreign workers but must arrange a proper mechanism for their arrival.
Climate refugees in political pass-the-parcel
LONDON (Reuters) - The islanders of Tuvalu could lose their homes and much of their land in the coming decades. But the world has yet to figure out how it will deal with them, and millions of others, who may be displaced by climate change."It's a game of political pass-the-parcel," said Andrew Simms, policy director at British think-tank New Economics Foundation. "No one wants to be left holding the problem of climate refugees."
Aviation industry must act fast on climate change: Airbus chief
LONDON (AFP) - The aviation industry must act quickly to lower its own carbon emissions or face government regulation, the chief executive of European plane company Airbus wrote in a comment piece Thursday.
China tells developed world to go on climate change 'diet'
BEIJING (AFP) - The developed world should go on a climate change diet rather than lecture China over its rising greenhouse gas emissions, Chinese Foreign Minister Yang Jiechi said Wednesday.Yang told reporters that China's per capita emission of the gases linked to global warming remained less than one third the average in developed countries.
"It's like there is one person who eats three slices of bread for breakfast, and there are three people, each of whom eats only one slice. Who should be on a diet?" he said at a press conference on the sidelines of parliament.
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Gold hits $1000 an ounce
According to CNN. It has since fallen back.
Here's a link to a BBC story about it:
http://news.bbc.co.uk/1/hi/business/7294040.stm
As the Chinese aphorism says, what goes up like a rocket comes down like a rocket. Gold will plummet as soon as the recession begins from the high price of oil. Economists quoted in THE WALL STREET JOURNAL say that we go into recession when oil hits $125 to $150 a barrel. Well, that could be tomorrow with the right mix of global problems. And it will happen anyway in about 6 months due to just high demand. And when global oil production begins its terminal descent, gold won't be worth much. Gold is valuable for its use in electronics and jewelery. In an oil depleted world, electronics and jewelery will hit the skids, and so too will the price of gold.
and what are those paper $$$$'s worth ? imo, the demand for wallpaper will "hit the skids" as well.
The value of paper money will drop too, but gold drop faster. In the long run, all money, bank investments, pensions, long term care insurance, etc. will have no value. All investments and money represent the power to buy oil, natural gas, and coal, and the energy and stuff it provides in the future. In the long run there will be no fossil energy, and not much energy, and promises to deliver energy in the future are illusionary.
In that case it is very weird that gold and silver were valued not just as ornaments but as stores of value for thousands of years before fossil fuels were substantially exploited.
What's changed?
That was yesterday, today is another day. What will people do with gold in a fossil fuel depleted stone age society? Will you trade your vegetables for something just because it is shiny?? The new stone age won't be anything like even 2000 B.C. In 2100, there won't be any global, national or even trade between cities. Just how do you suppose people will get around to trade gold tokens for stuff from afar. Maybe read some of Chris Shaws' stuff to get some historical perspective on gold and energy. His 5 articles can be found here: http://www.onlineopinion.com.au/view.asp?article=3837
He makes the point that energy has always been the one true currency. Think about it. He is right.
I have thought about it, and decided you were incorrect.
You are moving on to another line of argument now the first that the value of gold is dependent on fossil fuels has proved unsustainable.
I do not intend to follow you there, now that the first grounds are proved specious, nor to read 5 articles.
Please sort out the case you wish to present in the first case, and please do not request that anyone read 5 articles - if you wish to make an argument, you should be able to summarise.
I have looked at the alleged loss of value for gold as much as I wish to.
You didn't think for very long. I thought about what Shaw wrote for months before concluding that he is right. Indeed, I read his articles several times. He has much to say about energy and history, and he is quite humorous too. This gave me new insights for thinking about Peak Oil.
Didn't take long to think about, really.
IMO, humans will always value gold. Also IMO, we're not going back to the stone age. If we're unlucky, perhaps a modern dark age. Perhaps.
For every person buying gold there is another person selling gold - I wonder what the person selling the gold is buying with his money. If he has held the gold for any length of time his pile of money has magically grown, but was it a good store of wealth?
Most people are using gold as a compact, very dense, indestructible store of wealth, gold is not convienient any more for day to day financial transactions - they are two different uses.
If you hold gold as a store of wealth no interest is payable, so it is viable long term so long as everybody accepts gold has value - unlike our current fiat, fractional banking, system which must have growth.
All saving methods are risky, gold is no exception.
Maybe he's just meeting a margin call?
It's interesting to see what happened with gold in other societies that suffered economic collapse. The guy from Argentina recommended gold, but said to buy a bunch of cheap gold wedding rings, rather than coins or other investment pieces. He said the dealers would give you the same amount for any piece of gold, regardless of size or quality. And I suppose offering a cheap wedding ring would make you less of a target than flashing around a big coin or ingot.
The Yugoslavia guy didn't recommend gold. What use is gold, when there's no food or fuel to buy? He said other things were far more valuable: soap, cosmetics, toilet paper, cast iron cookware. People would trade food for those items.
Maybe we'll just trade with cigarettes. Right.
Sorry cjwirth but people move to gold when they are uncertain about the value of paper money. This is exactly what we are seeing now with the problems in the interbank market, even securities backed by the government are being marked down. The US government is panicking if they have to inject hundreds of billions into the market to keep it from collapsing.
Gold has been seen as a store of wealth for thousands of years since unlike paper money the amount cannot just be changed overnight by governments.
Only a small fraction of gold is used for anything, the vast majority of gold is held in store.
You buy gold then. I sold my mutual fund investments in gold and I'm buying land now, 1 hectare on a river, in a location with 2 meters of rain annually, with a short dry season, coldest in the 40s and warmest about 95. After the collapse, you'll have gold, and I'll have food. See ACE's chart on world population at http://www.theoildrum.com/node/3726#more
I won't want any of your gold, and I don't think my neighbors will either.
That's fine if you think that things will really go down the pan.
It is really the old conundrum that you can't eat gold.
However, people are remarkably resistant to throwing away their ill-gotten gains, for instance the French army on the retreat from Moscow carried as much loot as they could for as long as they could before abandoning it, and almost up to the end there were a few optimists who for enough gold would swap some invaluable food, if they had any.
So gold will loose it's value eventually, but things have to get pretty extreme for that to happen.
It was your original assertion that the value placed in gold was solely due to fossil fuels which is incorrect.
The last time the dollar was falling this hard and inflation was roaring, gold went up, not down. Not until Jimmy Carter convinced some of the largest gold buyers in the world (among them at that time being Saudi Arabia) that the dollar would be ok, did gold fall. In other words, gold did not fall until the dollar began to strengthen.
Thus, I don't see how gold can fall at the same time that the dollar falls. You can believe what you choose but are you actually short gold? Are you putting your money into that bet? Some of us have been long gold and silver for quite a while and I don't see any reason to change that position.
Will there be periodic corrections? Yes, just as oil has been volatile. But the trend line remains upwards unless or until the dollar actually strengthens. So long as the dollar is weak, I will expect gold to either rise or at least retain its current levels. Historically, it has been more accurate to think of gold as the "anti-dollar" - when the dollar falls, gold rises. When the dollar rises, gold falls.
You are clearly clueless. Check out the gold price at the end of the first oil crisis. Gold increased 10 fold during the crisis. Jewelry and industrial demand are both negligible compared to the stocks kept as investment by banks and individuals. Gold will follow oil up. And silver will do even better.
The intrinsic value of an asset is a direct function of the amount of energy it takes to extract it from nature. What makes gold so valuable is that once that energy is expended, the product stays good for a very long time (gold doesn't oxidize or otherwise fall apart). Even if its utility is limited, gold is something you can always count on, regardless of the future availability of energy.
Please, no ad hominum attacks. Gold is not very nutritious, see my comments above. Why would things remain the same after the world economy and civilization as we know it collapses, and most people on the planet die??
Most of human history occurred with less than 8% of the current population. Great empires of non-technological societies were forged and extended, often in search of gold (as well as other resources), when global population was a mere 4% of right now. That would have been Rome, you know?
You seem to assume that collapse means The End. It hasn't before so far and I don't expect it to this time either. And if it did, we're talking extinction, where nothing, not skills, food, sewing needles, or gold would matter anyway.
Doubt about the value of gold (and silver, particularly in ancient China) globally as a means of storing value suggests considerable reading of history with regards to precious metals might give your reason to reconsider your position. There have been a very few isolated societies where gold was not seen as having value. Those are far outnumbered by those societies that saw gold as being valuable.
Of course people should prepare first for collapse by emphasizing usable skills, materials, tools, land, etc. But if you reached the point where you felt as prepared as you could be but still wished to find a way to transfer wealth out of a collapsing society, across the void of collapse, and into a new society, gold might be one very likely means to do that.
Economy and civilization will not collapse everywhere and certainly not at the same time. In many parts of the world, people will muddle through for a long time.
I completely disagree..
People with wealth want to preserve that wealth.
If there is fear that other assets might under perform, there will be a flight to quality:
Gold and Land
Seems to me that everyone is discounting the value of wits, as "living by one's wits." Gold and land will be important, then as now. Intelligence will be the most important, then as now. Intelligence, and the ability to use it, that is -- as in social networking. Clever people will always find "legal" ways to take the gold and land away from the less clever.
Nothing has changed, or ever can change without a total change in the nature of our species. And then, it wouldn't be us.
My fear with land is that it will be taxed.
In "Gone with the Wind", one had land. But not the money to keep the tax men at bay.
If we do enter economic collapse, Governments will be looking anywhere they can for some entities which are ripe for extracting cash. Its hard to know who has gold. Or knowledge. They already know who has accounts or land - and what its worth.
KNOWLEDGE is the most valuable of anything I have. I have almost all of my assets in practical skills. I can build/repair damned near anything. Right now, my skills are unused, as I am in competition with the cellphone.
Today, stuff is replaced cheaper than it can be fixed.
Example: No-one today runs R-290 in their refrigerator.
Say we have the fullbore economic collapse and freon and new refrigerators are unavailable? But I can still get compressors from scrap yards? I am not gonna tell you what R-290 is, but I will give you a hint: its widely available and is a damned good refrigerant, albeit it is flammable.
Maybe that interested you enough to google it.
If there is no-one answering the other end of the phone, my services will be invaluable - more precious than gold.
Anything else I have is fair game for the thief or tax man.
Either of them will find ways of taking everything I have, except whats in my head. That alone is mine.
I feel the only thing I have going for me is to make myself useful to others. I get a strong impression that useless people will not survive in a scenario where what you can DO reflects how much your community needs YOU.
Steve...
"my services will be invaluable - more precious than gold."
Yes, but what will you accept as payment?
Food.
:-)
Propane goes up pretty good if the refigerator leaks (as do other hydrocarbons) that's why halons HFCs and HCFCs are used so widely - R290 usually blows the doors off the house.
You think we will have spare energy for refrigeration? Hmmm ... I think it depends where in the world you happen to be!
But I do agree 'Mr fixit' type people will be in great demand sooner than most expect - that's why I am teaching myself to design, program and build circuits with PIC chips. Even the apparently simplest devices such as refrigerators have embedded microprocessors which are no longer manufactured after a very short while - IMO there will be a need for people who can build and program electronics enough to keep basic systems running without the correct spare parts.
In the UK at least, the 'useless' people now consume a good part of our taxes - what happens if there are insufficient taxes to pay for the social security?
The US isn't in recession now? Look at the second chart.
http://www.shadowstats.com/alternate_data
Cheers
Too bad that GDP chart doesn't extend backwards for another decade. I suspect that it would clearly illustrate that the US has indeed essentially been in a long-term recession since the mid 1970s, broken by only a few brief episodes of positive GDP growth.
What is clear is that the long term trend is not flat, but down.
wnc, i wonder if the national debt, imo,a keynesian index, doesn't show what you are saying:
"the US has indeed essentially been in a long-term recession since the mid 1970s, broken by only a few brief episodes of positive GDP growth"
i sometimes wonder if regan and his cia trained vp didnt see this. 1980 was the start of the current and onging national debt bubble.
AKA "living beyond our means"
... AKA "Contract
withon America."that didnt happen until '94
"that didnt happen until '94"
I count six prior: The Square Deal (TR 1904), New Freedom (Wilson 1912-13), New Deal (FDR 1933), Fair Deal (HST 1949), Great Society (Initiated by JFK 1963, finished by LBJ 1964), and the no-name, supply-side, trickle-down "Voodoo Economics" of Reagan, 1981. Those interested in their particulars can look them up in wikipedia.
The most likely name for that voodoo was Morning In America. Followed by the ominous New World Order.
In additional to its use in jewelry and electronics, gold also functions as a currency. Did gold go up from $250/oz to $1000/oz because its use increased in electronics and jewelry? The bull market in gold is a mirror image of the bear market in US $. As long as the US $ keeps falling, gold will keep going up.
As long as we have civilization, gold will be considered valuable.
Hello Suyog,
Your Quote: "As long as we have civilization, gold will be considered valuable."
The basis of civilization, job specialization, and wealth creation is food surpluses. Food surpluses are only possible with I/O-NPK.
My speculation is that those of us who can't afford land might gain some small survival advantage by hoarding I-NPK to trade for food. Farmers will not be interested in gold, big screen TVs, or plastic salad shooters, but they will be interested in the 10:1 ERoEI of I-NPK.
Of course, the timing and methods of achieving this on a personal, community, and regional scale have been the subject of my recent postings. I just wish I had more expertise on this topic.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
The above post is based upon the assumption that the American masses will prefer to wheelbarrow their way into relocalized permaculture. If not, then stockpiling ammo and machetes for trade may be the better investment. :(
The only thing we have to fear is fear itself. Strong words even today bob.
Here is a fomerly very wealthy society that didn't hoard their phosphate when they had the chance:
http://www.telegraph.co.uk/news/main.jhtml?xml=/news/2008/03/13/wnauru11...
-------------------------------------
Tough times for Nauru as money runs out
Nauruans once enjoyed the second highest per capita income in the world, thanks to their island consisting of almost pure phosphate, a mixture of ancient coral and millions of years of seabird droppings.
They went on a giddy spending spree, chartering planes to take them on shopping trips to Hawaii, Guam and Singapore.
In spite of the island's 25mph speed limit, a chief of police bought a yellow Lamborghini, then found himself too fat to fit behind the wheel.
-------------------------------------------------------
Recall my earlier Mo-rock-o P-irates & AFRICOM postings for control of Life's Bottleneck. Have you hugged your bag of NPK today?
Totoneila,
Why do you think we will not have a food surplus in the US for the next 20 years? We have enough oil & natural gas in this country for agriculture, making fertilizer, railways, etc; just not enough for everybody to drive a ICE car. If it comes to a crunch, people will get rid of their lawns and create food gardens and raise chicken and goats in their backyard.
There will be considerable hardship, no doubt. But civilization - at least in N. America & Australia - will survive.
I hope nobody is making investment decisions based on this advice!
Good on you cjwirth - you rarely find commentators who understand that less oil is less wealth..
Not quite. Gold tends to do well in times of trouble because it's a store of value thats easily portable and usable. That's why gold did well in the 1930's, even though other commidity prices bombed. Because of this south Africa managed to ride out the 1930's even though other commodity based economies had nightmare time.
Did well in 1930's?
You need to review a little history.
http://en.wikipedia.org/wiki/Executive_Order_6102
South Africa was hardly impacted by a United States executive branch executive order now, was it?
Weatherman's point was that, globally, gold did quite well. Yes, there were proto-fascist states seizing gold, our own amongst them. That doesn't change the fact that for a large segment of the world's population that gold was a good investment then.
Given the current state of affairs, it is more correct to say that "the dollar dropped to 1/1000 of an ounce". Got help us with the coming hyperinflation.
Suddenly electric gets a whole lot more doable (eventually):
http://news-service.stanford.edu/news/2008/january9/nanowire-010908.html
Don't get your hopes up too much, the life cycle of the battery is limited and production may take 5 years. I'm selling the Brooklyn Bridge, any buyers?
Er, if you read the quote, lifecycle problems from the use of silicon was one of the problems that nanotechnology addresses, as well as energy density.
They do this because they do not fraction the way larger wires do under repeated swelling and shrinkage.
I can't find my bookmark at the moment, but in another interview the researcher said that although to get the full 10 times performance increase from the battery you would need a better cathode, on it's own this new anode should increase the capacity of lithium batteries by several times, and that silicon technology is well understood so should be fairly swift to implement.
And just how many recharges are we talking about?
Plainly that is not fully assessed yet.
Equally plainly that is what this technology specifically addresses.
Dave-
Nature Podcast (or possibly the Naked Scientist, a podcast put out by Nature) did a story on this technology, and why it works so well. It is in their archives if one is interested.
Cheers - it was naked Scientist - here's the link:
http://www.thenakedscientists.com/HTML/content/news/news/1288/
Mega-cell: Researchers build better batteries - The Naked Scientists
Good Post Dave Mart. While this article is old it seems to me it is a very exciting development. There was a similiar announcment with nanowires with respect to solar panels in this article:
http://www.treehugger.com/files/2008/02/hairy_solar_panels_nanowire.php
Hmmm I didn't even notice it was an older article. I linked to it just tonight... and cannot for the life of me remember where from. Anywho... this is the first I've seen of it. Of the various "breakthroughs" we see all the time, this one looks a lot more likely to see store shelves than others. And, 5 years time might not be a bad fit with big roll-outs of solar power and hybrid/electric cars...
Cheers
The revolution in materials may just help us out of this fix. Batteries keep making leaps and that is certainly encouraging. Capacitors seem to be coming along nicely was well.
Each time I look at the future it keeps becoming more electric.
"The revolution in materials may just help us out of this fix."
it seems to me though that batteries are suffering from that same old planned obsolescence marketing thing that makes the depreciation of cars so strong.
imo, a successful response to peak oil will require a paradigm shift away from this infinite growth model.
So it's growth or limits again? For my part, I don't subscribe to either ideology. Reality tends to be a lot different from an artificial assessment laid over top which is often charged with an ideal view of 'perfect world.'
Malthus, imo, may have had some great points. Same with the Club of Rome. Yes, resources are limited. But something would have to go seriously wrong for the world system to fail the way Malthus envisions it. On the other hand, magical economists who believe the market can save anything also represent what I would consider to be an extreme view. The market doesn't make choices and innovation. Human beings do. We have to make the right choices.
Now hear me out before you label me 'cornucopian' and have done. In general, I think there are resources, opportunity, time, innovation and assets. Resources includes anything useful we can access in the world around us -- on earth, in space, oceans, wherever. It's the stuff we have access to. Resources are widely varied and mostly limited by one degree or another. Opportunity is where the market and other drivers come in. Is there a reason or an incentive to go and produce a given resource? Time -- how much time is available or needed to produce a given resource. Innovation -- the intelligent and creative human potential. Certainly this is also limited to a degree but can, at times, be very surprising and powerful. Einstein said "creativity is more important than knowledge." This is the spirit of innovation. Last are assets. In this respect, I mean human assets available to make use of the resources around us. This is also a moving variable with a wide number of dynamics in play.
Now someone from a limits point of view might say I'm just saying limits in a more complex manner. Or they might think that I'm a cornucopian because I think growth can continue to happen, albeit more slowly, given access to new resources, ways of thinking and doing business. But I don't think we should continue in a business as usual manner. Quite the opposite. We should push our systems to continue to improve and come more into balance with the resource limitations that are very real and apparent.
So when I say the revolution in materials may help us out of this fix I'm not saying there won't be a crisis. I'm not saying don't worry it will all be smooth sailing. I'm talking like a soldier on a battlefield that hopes like hell there will be air support. Why? I happen to like my fellow humans. My friends. My family. My wife. I want to see them live, prosper, and be happy.
As of yet, I haven't found an ideology worthy of them. They are all too cold, hard, callous and full of self important definites. Such things, in the realm of history tend to be a little destructive. So I'm no part of it thank you very much.
Now back to your point. Do I think that these companies will engineer obsolescence into their batteries? Well, if they can control the market, probably. But seems like there's an awful lot of competition out there so anyone doing such a thing without control would be knee capping themselves.
In the end, I see progress toward a technology that makes us less dependent on oil while allowing the option of retaining modern mobility is a good thing. Now there are some who would disagree with me. But, in my opinion, people who think this way tend to be against civilization as a whole and tend to hate and distrust human beings in general. For my part, I think such a view is nothing short of destructive. We are humans after all. We may as well strive to be the best humans we can be and learn to mold our technologies so they don't take so much and eventually give a little back.
Well enough philosophy. Thank you for letting me share my thoughts and good luck!
Britain could be in bigger trouble than the US
http://business.timesonline.co.uk/tol/business/economics/budget_2008/art...
Government deficits are also high:
http://www.telegraph.co.uk/money/main.jhtml?xml=/money/2008/03/13/cnspla...
Some indication that China is not going to be the buffer to a global recession that some hoped.
http://www.ft.com/cms/bfba2c48-5588-11dc-b971-0000779fd2ac.html?_i_refer...
In case you can't get in:
- Trends in Nasdaq in '99 - '00 and Shanghai Composite '07 - '08 mirror each other (SC down to @4100 from @6000!)
- Chinese inflation up to 9% from around 1% in '06. Food inflation @ one-third of total, which is a huge percentage and not likely to fall given the current problems we face globally (the harsh Chinese winter being part of the problem).
- China may have to slow down production to clear the air for Summer Olympics.
- Alluded to above: some were counting on China to keep the global economy going despite US slowdown, but that is becoming doubtful. (Big psychological effect, apparently.)
Bifurcations, non-linear events...
Cheers
OTOH, retail sales up 20% YOY with a strong savings rate. Very strong currency. Strongest industrial economy on the planet (by far).
I guess we'll have to wait a bit longer for that nuclear renaissance.
http://www.bloomberg.com/apps/news?pid=20601109&sid=aaVMzCTMz3ms&refer=h...
Looks like the design criteria may have to change - smaller ship-sized reactors anyone?
graphite bricks and concrete?
There are a number of work-arounds mentioned in the link.
Other companies are building up their capacity, as mentioned in the link, whilst Japan steel itself is considering doubling it's capacity to 8 a year.
In five years time that might mean a capacity of around 16 reactors a year, plus Russian build, plus this from the link:
From a recent article here on TOD it was apparent that we need around 90GW per year of new capacity from all sources worldwide.
Since it appears that we could have around 25-30GW per year of conventional reactors including all sources within around 5 years it would not appear to be very onerous to build up to that sort of level so that if required nuclear could take care of all new build within 15-20 years.
In addition to this, I believe the pebble-bed reactor design does not have as onerous requirements for a containment vessel - China plans 6GW worth of these by 2020 and they are mass-producable.
The real issue is security of demand:
Expensive oil and shortages of other sources should help to remove this uncertainty.
If required nuclear can take care of world energy needs.
"There are a number of work-arounds mentioned in the link."
There was one mentioned in the link. That was forging the reactor in two pieces. But this would increase the risk of a radiation leak, and is an obsolete technology, as mentioned in the link.
"Other companies are building up their capacity, as mentioned in the link"
And that capacity will take *more than 5 years*, as mentioned in the link.
"whilst Japan steel itself is considering doubling it's capacity to 8 a year."
Which still represents a major bottleneck as mentioned in the link.
I was taking the fact that other companies were going into production as mentioned as 'another work-around' - sorry if that was confusing.
They would take 'more than 5 years' according to Japan steel who may have something of an axe to grind, as we are after all talking about their competitors, who may not feel that they are five years behind.
I agree it represents a bottleneck at the moment, but as the guys at Japan Steel said that is mainly die to the fact that they don't know if they can rely on the demand, especially from the US.
It is not building the capacity to cope that is the issue.
How about just doing without containment?
Where's Waldo? Maybe he'll be in demand.
Perhaps you haven't noticed folks DO NOT post flashing things here.
It's not a rule, per se, but it is distracting. Imagine if every post flashed or wiggled at you.
That was pretty damned annoying. I nuked it.
They're not containment, they're pressure vessels. I'm unconvinced of the future of pebble beds myself. They dont appear to have any obvious advantages against light water reactors and have a lot of inherent disadvantages (impossible to reprocess fuel, graphite moderation, lack of containment) that LWRs dont.
I am no big fan of PBR myself, mainly because of relatively low fuel burn.
The advantages they do have are, as you say, they avoid the need for containment - sorry for the sloppy writing in my earlier post - and most importantly modular build possibilities, which should reduce the financing needs considerably, which with the way the financial system looks could be critical.
Molten salt reactors and nuclear batteries are my picks, although the Westinghouse design now is pretty good.
The CANDU's ability to burn thorium is also of great interest - I notice that the Indians intend to start the construction of their first thorium reactor this year, designed all in India - kudos.
They don't! Unless they're built underground, the safety need for a containment is there. Theres a number of failure modes present in PBR's that are stopped only at the containment dome. Its more correct to say that PBR's are incompatable with containment domes for convection cooling reasons.
And they'd lose those advantages in licensing.
Good grief! Since there are none being built in the West, I hadn't bothered to look at them too closely - hence my loose phrasing about containment buildings, pressure vessels and so on.
I'm surprised the German's built something like that.
Here's what wiki says:
Have they dropped from those standards?
In addition:
Sounds like decent safety - but of course I am just a layman
Sounds like decent safety
The theme of the majority of the pro-nuke people is build very large, centralized plants.
This is kind of an non-issue for example compared to the lack of qualified personnel. It will take probably 5 years to completely remove this bottleneck, while reestablishing and/or expanding education programs plus recruiting and training personnel will take many times that.
Anyway no new reactors are expected to come online in the next 5 years in countries with previously dormant nuclear programs, so again I don't think this would be a serious issue. Only COL application process in US is taking ~3 years, so it is unlikely these extra forgings will be needed tomorrow or even by the next 4-5 years.
Methinks I may have been too optimistic
When production in exporting countries starts declining, the resulting decline in net oil exports tends to accelerate. It seems to me that as total net oil exports show an accelerating rate of decline, it would cause an accelerating rate of increase in oil prices as importers bid against each other for declining oil exports.
IMO, as forced energy conservation moves up the food chain, the rate of increase in energy prices has to accelerate because energy consumption as a percentage of income falls as income increases, e.g., a poor African versus Bill Gates.
Wouldn't these two forces tend to reinforce each other--causing a geometric increase in oil prices: $50, $100, $200, $400. . .
This is even without considering the dollar effect, which raises an interesting question. Is oil going up because of a falling dollar, or is the dollar falling because of high oil prices?
In any case, an accelerating rate of increase in oil prices causes an accelerating rate of increase in food prices.
The obvious problem is that the number of people that have trouble, or who are unable, to pay their food & energy bills is increasing, which is compounded by declining income. What happens when you can't earn enough to buy food for your family? Welfare is an obvious, but problematic, choice, as the number of people seeking help crashes the system. I suspect that we are going to see the reemergence of the county work farm, where you work in a farm to get the food to feed your family.
Which brings me to ELP, which I have been recommending for around two years. My long essay on the subject was posted about a year ago. If a lot of people are going to end up working on a farm anyway, wouldn't it be better to try buy some agricultural land while you can?
ELP Plan (April, 2007)
http://graphoilogy.blogspot.com/2007/04/elp-plan-economize-localize-prod...
ah darn Westexas you had me yesteday with taxing energy consumption and getting rid of the payroll tax, now this. Out of curiosity are you going to take responsibility if your predictions are wrong about such a large majority of people working on farms. Hell hath no fury like someone who sold their comfortable urban lifestyle for a farmhouse only to find out community farms were not needed. Best hopes for Westexas avoiding angry mobs in the future.
From the ELP article:
BTW, The "E" and "L" recommendations don't involve living on a farm. The key part of "P" is to start working toward positioning yourself on the non-discretionary side of the economy, with however food being a huge part of the non-discretionary sector.
Of course not, and I hate both of those things myself, but its not a Large SUV and Suburban McMansion or a Shack in the middle of a corn field, there are many more rational options inbetween. A condo on already electrified rail, A rowhouse with walkable options, hell, a nice rowhouse in a walkable small town. All options a long way from a shack on a prarie!
So i'm gonna get rich on my shack in the prarie growing crops? Getting up and working 14 hour hard labor days on the farm is not stressful?
It probably beats starving.
The key point is that the discretionary side of the US economy is imploding. Consider a mortgage broker who was making $200K in 2005. What are his job prospects now, versus skyrocketing food & energy prices?
But food is not the only thing to do. Things like repair & maintenance will be in big demand.
I have a friend of mine who quit being a real estate broker just before the bubble busted and is now an operating engineer for a large building. Someone’s always going to have to be around to keep things running.
I find the phrase "14 hour hard labor days" meaningless here. What size farm?.. what crop(s)?.. what climate?.. etc.
As a gardener - who occasionally talks with horse-using farmers - I've discovered that "hard labor" is often an overly-presumed phrase. Back in the 18th & 19th Centuries a lot of cornfields were cross-plowed before planting (double the effort). Why? Nobody knows for sure. The farmers who plow today with horses will tell you that they often have to "make work" for the horses outside of plowing and harvest times just to keep the horses in reasonably fit condition. In short, (unless you need to irrigate) there's often very little to do on the growing fields of a farm for most of the year (once the infrastructure is in place and working). Now, fixing the barns might be another story-
I agree. I am a major gardener, good friends with people who farm with horses, manage my woodlot with my horse, etc.
It seems that "farming" (whatever that means) is either ridiculously romanticized, or characterized as 14-hour days of back-breaking drudgery 365 days of the year.
Both views are unhelpful caricatures.
I have a huge garden and I do all the work by hand, no rototiller or anything. I look forward to the double digging and planting, harvesting, even weeding. It keeps me in shape. Can't wait to get out there now. Unfortunately I'm in Vermont, still 30 degrees with 3 feet of snow on the ground. The nice thing about farming is you get six months off every year - it's called winter.
I take two months a year off from gardening - July and August - because its too bloody hot to grow anything other than okra and cover crops.
Black Eyed Peas and Lima Beans love the hot dry August weather here in NW Arkansas. Texas Hill Country okra laughs at drought, as do BE peas and Limas.
I'll have to try the Lima beans - I've grown BEPeas before, but just don't have the room to make it worthwhile.
The notion of returning to the farm for survival is often tossed around here. The idea is... you invest now in the capital and land that will provide future benefits...i.e. food and fuel production for survival in a post peak world. Great... I get that... but what are the alternatives? What if instead of spending that capital on land and equipment, you spent it instead on the food itself, and what is the cost of this option? Lets look at these two alternatives.
Option A, purchasing land and equipment:
I live and work in Houston.... Rural land in the surrounding counties can be found in 10 acre tracts for around 10k an acre. So assuming 10 Acres can provide sustenance for a small family, you need 100k for the land, and perhaps another 100k for shelter, farm equipment, windmills, solar panels ect. Call it 200k.
Option B: Just buy the food upfront
These are some rough numbers, feel free to refine them for your own calculations. I have read that rice can be stored indefinitely if it is kept away from pests, humidity ect... I can't say that I would readily eat 50 year old rice, but if I was hungry, why the heck not? One pound of rice will yield ~2000 calories, or a pretty good chunk of an average persons daily requirements for sustenance. At Sams club, about a week ago, a 50 lb bag of rice was $15, or $0.30 per pound. Multiply by 365, and we can feed one person rice for a year for $110. I have to believe that rice could be purchased cheaper in bulk, so for sake of round numbers, we’ll say it takes $100 to feed a person rice for a year (but it could be much less). Not bad… I can swing that. If I wanted a 50 year supply of rice for my wife and myself, we are talking about $10,000. Then of course is storage. I need a container that can hold 18 tons of rice and keep it safe from moisture and pests for 50 years. I haven’t a clue, but probably this would cost at least as much as the grain itself…. Say another 10k. Maybe that’s some kind of silo or container, or maybe it’s just some kind of heavy duty vacuum packing system.. I’m no nutritionist, but it seems quite likely that a rice diet is probably lacking in some vitamins and minerals… this would likely be remedied by vitamins, which can be bought cheaply, and by an addition of proteins and vegetables that could be raised (chickens) and grown in gardens.
I guess what I am getting at is that instead of working 14 hour days on a small farm, if you are certain that collapse is either near or at least eminent, instead of spending your money on additional acerage, just buy a few acres for a small garden, chickens ect.., and spend the rest on grain itself, as opposed to the land and equipment to grow your own. You might not want to limit yourself to rice…. Add some other grains and beans. The older you are, the more sense this makes as you have less food to store, fewer years to store it, and your physical capacity to farm will be diminishing anyway. You still need some land, as well as solar and the home, but you can probably save over 100k because you will need less land and less equipment.
The storing grain idea is a good one I've seen before, but rice and vitamins is going to leave you sick in no time. Vitamins are catalysts, not nutrients. Still, your overall idea here certainly sounds workable. (But apparently your 14 hour work days is, as stated by others above, not a realistic depiction. I've run across at least one story of a couple with a backyard garden that serves all their basic food requirements, but both hold down jobs and still have leisure time.) One of many variations on a theme. Where your plan falls down is in not addressing the reasons for the choice of going to the land in the first place.
For me the choice, should I be able to implement my plan (fuzzy tho' it be at the moment), is about independence and security, not an idealistic return to the land for humanity. (I will admit that would be an ideal if it included maintaining our knowledge and science while learning to live sustainably with technology, but I have zero faith in human nature to be anything other than what it has ever been when large numbers of us congregate.) I want to be free of others having control over my security. Whether it be a bank holding a mortgage over my head, an employer holding my job over my head or the government taxing my "income," I want out from under. I've even designed a motor/generator to help me get off-grid. It's a design that I know works because there is a company producing a similar concept already. I found it on the net after designing mine. Figured I should check and see if it already exists. There are fundamental differences, so patents shouldn't be an issue.) Sadly, I am not an engineer or even a tinkerer. Until I find someone who could actually build the thing for me, it shall remain a drawing.
That we seem to be headed into an extremely volatile period in human just adds to the need to be self-sufficient - or as much so as one man/family can be. You need to add this into your calculations if you wish to understand why people are looking this direction.
Cheers
For those really contemplating trying to grow some portion of their own sustenance on a "home farm" basis, you should really check out Sharon Astyk's blog, www.sharonastyk.com.
There you will find very detailed accounting of what is entailed, with numbers and experienced commentary. Recent discussions have been on seed-saving, growing staple foods, finding bulk quantities of grains/beans/rice etc., and so on and so forth.
This is a long-running dialog/mutual learning experience, and will IMHO give you a very realistic idea of what is involved.
One of the arguments I like to make is that if you are not thinking of your own food production, and want to buy a 50 year supply, then really all you are doing is hoarding.
If you think (depending which Peak Oil site you go to) that the sheeple masses will attack you and your farm and kill you, then really they are only scavengers.
With food in the ground, you have a future and so does your family. A future hopefully means progress, progress hopefully means prosperity.
I'll be moving to BC to buy an acreage and house this summer. Stock up with 50 year supply of rice sounds good, but plant a garden as well. I won't be going anywhere if things get bad and I doubt anyone who thinks they can carry a 50 year supply let alone even maybe a 2 week supply of food on their back will go anywhere fast either.
Don't move unless you want to be out in the country. Think the city is the place to be, then have fun. It can take years to build up the nutrients in soil to be able to garden successfully. I laugh at the "I'll garden in my front/backyard" analogy. If you live in a new development, the topsoil was scraped out, clay (or other fill) was likely hauled in, a thin layer of dirt was sprinkled for your lawn, and the rest of that top soil is down at the garden centre, ready to sell back to you.
Granted that a 50 year supply of food is a bit extreme.... However, I think that the main point is that for someone thinking about riding out a post peak storm on their personal farm, grain storage can be an afordable part of a diversified plan of action. The optimum amount depends heavily on your finances, your age, and a multitude of other variables. But the question should at least be asked.... should I buy 9 acres and 10k worth of grains, or 10 acres and no grains. As for whether or not this is hoarding... of course it is.... but I see no difference between hoarding grain and hoarding land. As stated below... I don't intend to implement this....I only wanted to point out that at first glance, it seems both labor and capital efficient (if not romantic and personally fulfilling).
Considering how few people are actually thinking of relocating, etc, I too have thought a lot about longterm storage of a large amount of food, and white rice is probably the best choice.
The only real downside is that 50 years of rice per person is a hard secret to keep, and in addition to .22 ammo and cigarettes I think that "Death to Hoarders" bumper stickers will be in demand even when the bumpers aren't going anywhere.
If you think of how squirrels, Jays, and other critters do it, they disperse their food caches widely; and you could certainly do that now by buying cheap surplus 55-gallon plastic drums, filling them with rice and CO2, and burying them. Consider it time-shifted grocery shopping. Even then, though, if times are tough and your secret gets out, you could be tortured for your cache locations, which is something squirrels and Jays don't face. (Indeed, you might wish to start pre-emptive rumors that people you don't like have food caches).
Storing a huge amount of food is a "no down side" deal but may be kinda useless unless it's unnecessary. Still, one good reason to buy a big plot of land might be to have enough area that you could bury a lot of caches... then plant sunflowers or something over them to explain the disturbed ground. Not doing a bit of that would just be silly.
If you are considering the nutritional value of your stored food, forget white rice and white flour. Go for the real thing. Better for you by far.
Better for you, but not for long-term storage. Brown rice is good for several years before it goes rancid... maybe CO2 would slow this. I don't think wheat stores as well either. So I still recommend white rice for the calories to keep you alive... and an herb and veggie garden, some sunflowers, etc for nutrients.
It seems to me that the shorter term might be sufficient. If it takes several years to get a garden going, then how long do you need to cover? A few years. Add in emergency storage of a few years, it can be knocked down to five or so years, I'd think, with a fairly good safety margin. Maybe half in healthier grains for the shorter term and the rest in the processed stuff for emergency rations and to keep costs as low as possible.
Cheers
Yes but if you get a few rabbits and let them eat the weeds and grass sprouting in your garden, and then use the rabbits ---um---manure for fertilizer then you can build up your topsoil in no time. (You can also eat the rabbits if you get hungry, if you are so inclined.) Actually, rabbit manure--pure--is great for sprouting seeds before transplanting into your garden. And rabbits don't need a lot of grass, unlike a horse. And they can tolerate pretty cold weather, but not getting rained on. So why not give rabbits a try!!!
Don't give up on land that looks vacant and barren----nature abhors a vacuum and so should we!
Adults can survive on rice and fruits. Children need more protein (meat, milk).
Eating insects isn't a bad way to go; though chickens and eggs taste better. Also, though it's a funky thought, rats and mice will cook up and traps are currently cheap. And on amazon you can currently get a good hand-cranked meat grinder for about 15 bucks. I think a meat grinder would really pay for itself at the point you were doing bugs and rodents. Soylent brown... just don't ask what it's made from.
Unless you are going into sausage production a meat grinder is not necessary, small to medium sized chop jobs can be done just as well and faster with a pair of chef's knives. When you get your knife skills up to scratch you will have your bowl of "dice" ready while grinder guy is still getting the parts out of the cupboard. The grinder comes to the fore when filling bung for sausage, as long as you have one with the "snout" (sorry I don't know the correct name for the pipe thingy that goes on the front of the grinder that you load the bung on) attachment.
The insects I have eaten (earth worms and meal worms) have never required a grinder to process....
Rabbits are easy to raise, actually. too. They eat weeds and grass (no input other than what you can grow in your garden.) Also high in protein.
How long and how well without malnutrition coming into play? (Neither facetious nor sarcastic. I currently live in Korea...)
Cheers
nice post, but there are other options, ccpo refers to SPIN Farmers lower in this thread.
It is a really good idea and one I'm trying to turn into a course at my local jr. college. The infrastructure is already built in suburbia, we just need to tear down the fences and start building soil. This is a win win scheme for communities. I've had many young people come to my garden expressing interest in such a scheme.
a container to store 18 tons of rice? $10K Maybe you should go back to the drawing board. I regularly buy 40lb bags of rice that conservatively measure out to about 1 cubic foot. If I've calculated correctly that means you are going to need an initial storage facility of 900 cubic feet. That's one hell of a "container."
The more I think about it, individually sealed 50lb heavy duty vacuum packages are probably more economic, more tradable, and allow you to spread out the grains to diversify risk of loss...spoilage, theft ect.. All together That's roughly a 10x10x10 room, stacked floor to ceiling.(probably less...40lb/ft^3 seems a bit low to me) That's a hell of a lot of food, to be sure, but not completely unrealistic. Even if the cost is doubled, it would seem to save a lot of capital and labor. And maybe you don't need 50 years.... maybe 5 or 10 years worth would be adequate to hedge your bets. By the way, I have not implemented this, nor do I plan to in the near future.... I was just stocking up my hurricane supplies for this year and it occurred to me that rice calories were incredibly cheap (for now anyway), and I wondered if this fact would make it more feasible to buy and store grain at today's prices as opposed to purchasing farm land for future production. It's not a flawless plan..... eating rice more than a few days a week gets old fast.... eating it for sustenance would probably test my sanity. Nonetheless, unless my rough figures are cumulatively off by an order of 5, grain storage for future sustenance does not seem completely unfeasible if land is 10k per acre and you have no farming experience.
It may not be a bad idea, but just to be on the safe side you might want to do a small test pile first. Some varieties of rice (I've heard) are prone to going rancid (maybe get it vacuum-sealed so there's no exposure to atmospheric oxygen).
Also, test to see what type of container would be rodent proof. Cats seem to work better than any type of mouse-trap. Without cats rodents will over-run and eat grain storage in no time... ask any farmer who stores grain.
It's brown rice that goes rancid, due to the oil in the bran. White rice will store a long time. CO2 should deal with the bugs; metal walls will deal with rodents. I'm not doing it large-scale but I find that galvanized garbage cans (33 gallon) will hold a lot of rice and can be sealed airtight. Larger scale you could just get sheet metal and weld it inside a room. In fact, it would be interesting to design a house in such a way that it wasn't obvious that room existed. Not that hard to do, though you'd need a clever way of getting in and out of it.
Japanese farmers used to store bags of rice as insulation in their attics. Recall the scene in Yojimbo where Mifune kills a bunch of henchmen, then slashes the ceiling to make the rice pour out to make the fight look worse than it really was.
Who said anything about getting rich? What is about the American “lottery mentality” and the fascination with getting rich, in which thousands of morons go to costly seminars by “The Donald” and other blowhards? I suspect you’ll never get rich in the city neither, but hope springs eternal doesn’t it? And that comfortable urban lifestyle? Crowds, crime, traffic, high prices, dodging obnoxious criminal types, and high taxes, you can have them! What about the urban lifestyle is so damn desirable? Most people never able to take advantages of the culture the city has to offer. Since moving to a small farm almost two years ago my sanity has improved dramatically. I wish I had done it fifteen years ago like I originally planned (yes, I wanted to do this long before peak oil). Fourteen hour days? Antidoomer, you don’t have the faintest idea what you are talking about. I’ve worked longer hours as a wage slave in the city. I no longer work those hours because I don’t need the money to afford that “urban lifestyle” where the longer you work the harder you play and the more expensive toys you buy to justify the lack of free time. There are some periods where the labor is intense, especially during planting and harvesting (yeah, weeding also sucks), but it sure beats working long hours for someone else to make them rich, or out of the false hope I might become one of the rich.
I also love this myth about the livable areas near electrified rail. What often happens in many areas is they get extremely crowded, crime rises, and the price of everything goes up as people flood to the new trendy and “accessible” area. I’ve seen it when the Orange line went in in my former neighborhood in Chicago. If you are not lucky enough to be there before it goes in you’ll pay the price, even then your assessments and taxes will skyrocket.
So keep believing your delusions . Meanwhile I’ll continue to enjoy living on my piece of “God’s country” regardless of what happens.
I also love this myth about the livable areas near electrified rail. What often happens in many areas is they get extremely crowded, crime rises, and the price of everything goes up as people flood to the new trendy and “accessible” area. I’ve seen it when the Orange line went in in my former neighborhood in Chicago. If you are not lucky enough to be there before it goes in you’ll pay the price, even then your assessments and taxes will skyrocket
Roughly 30% of Americans want to live in TOD, about 1% (perhaps 2% depending on definition) do. The severe shortage of TOD increases the price and desirability.
However, increase the "T" enough to flood the market (say six or ten new lines in Chicago, enough to run out of colors, and extend some of the older lines) and let the "OD" develop, and the price premium for TOD will go down significantly#.
Best Hopes for Saturating Market Demand for TOD,
Alan
# Unless 67%, and not 30%, of Americans want to live in TOD, then even more "T" and "OD" will be needed :-)
Never happen in Chicago Alan, the CTA is broke as it is with a state legislature that is unwilling to fund any new projects. Witness the recent wrangling trying to get funding a month ago to keep the CTA going. I suspect this will be the case in many states as they are teetering on the verge of bankruptcy. Politics and corruption is a hurdle that I suspect is going to be too high to clear.
Under BAU, yes. Witness Bush's killing the Dulles/Tysons Corner extension of DC Metro (save 20 to 25,000 b/day when built out, provide non-oil transportation in a crisis, etc.). They would have started physical construction last week or this week, "stimulating" the economy.
But consider a world with $200+/barrel oil, 90% federal funding, and an awareness that Non-Oil Transportation is the way to go.
Chicago trades more small scale EMU service "downstate" for more subways and Els in coming up with that 10% local match. Perhaps a Metro area gas tax as well.
Best Hopes,
Alan
of late, the price of oil has been climbing about $1/day. at this rate oil will be $404 by ye.
...............i wonder if the ethanol calvary will get here soon enough ?
If you converted the entire grain crop of the United States to ethanol you might meet 16% of current gasoline needs and starve a few nations worth of people off the face of the earth.
Cellulosic ethanol is in the category of breeder reactors, sustainable fusion, and other boondogles. The fact of the matter is, if cellulosic ethanol were so cheap and great it would have been produced years ago. The Nazis tried to get alcohol from wood, but failed. Currently you have no profitable production of the stuff. People are researching it, have been since the 70's. Billions were spent on fusion for electricity projects to no avail. Much huffing and puffing about breeder reactors and there are currently zero breeder reactors.
The sustainable energy people did not realize that the ethanol process has high greenhouse gas emissions and high energy inputs, thus is not easily sustained. The wood chips crew might have chainsaws, but does cutting down trees increase greenhouse gases? I thought trees took carbon dioxide out of the atmosphere. Wood chips were used for particle board. Particle board was used in home construction. Am not sure what this might do to the wood chip prices. The stuff is not free and cellulosic ethanol is not easy or it would be in use as I write, and it is not.
I agree the Tokamak fusion reactor is a boondoggle.
There are other fusion possibilities which unfortunately get crowded out by this.
Your remark on there being no current breeder reactors does not take notice of the reason the French program was discontinued - uranium was so cheap and plentiful that it wasn't worth it at the time.
Do you have a source for that claim? Meaning do you have a reference to the documents where the decision was taken to shut down the reactor?
http://en.wikipedia.org/wiki/Fast_breeder_reactor
It was uneconomic due to cheap uranium at the time - a quick google will get you more confirmation if you don't like Wiki.
I attended a public unveiling of a new architecture for ethanol production this evening. The following statistic was rather interesting ...
The USDA says we'll be getting 36,000,000,000 gallons of ethanol in another ten years. We get three gallons per bushel so that is 12,000,000,000 bushels. We get about 200 bushels per acre so that is 60,000,000 acres of production. CNN indicates we have just 67,000,000 total corn acres under cultivation now.
http://money.cnn.com/2007/03/30/news/economy/corn_plantings/index.htm
I just sat and listened - they're trying to pump ethanol yield by harvesting cobs along with the kernel, thusly obtaining a mechanically and compositionally uniform feedstock for cellulostic ethanol processing. The cobs are almost pure cellulose. Those who keep bringing up the gathering of all stalks for celluostic ethanol should probably be still unless they've got access to research - the guys who are doing it say no way to the irregular size, shape, and composition of what they get by stalk collection.
I have to say, if I can get a bit of land, or just a big yard, and do intensive farming/hydroponics/aquaculture enough to fed my family and keep a good larder while building myself a small, comfortable off-grid home and not *have to have* a high-paying job to just keep the bills paid, I'd be feeling pretty friggin' rich.
Given the above setup and an income of $1,000 a month I could probably save $800 of it once the food production was up to a full year's cycle and self-sustaining. Might even make a little money from the garden/farm.
Cheers
http://www.hydrostacker.com/about.html
http://www.spinfarming.com/whatsSpin/
http://www.backyardaquaponics.com/
As I have noted on many occasions, I live in the boondocks and have for over 30 years. One of my reasons for leaving the corporate world was that I had risen high enough in management (I was a chemical plant manager at the time) to know how the system worked. I decided I wanted time and security not lots of money. Incidentally, a good essay is "When Belief in the System Fails" by Charles Smith http://www.oftwominds.com/blogmar08/belief-fades.html
Right now I'm working on the 2010's firewood. It's certainly a lot of physical work especially at 69 but it is far more rewarding knowing that we'll be warm no matter how high the price of fuel goes. And, the peas, garlic and shallots are planted in the year's garden. I'll be starting some other vegetables this afternoon so they'll be ready to transplant in late April. The plums, peaches and pears are going into bloom, the apple buds are swelling (This is early so I hope they don't get frosted.) and the berries are putting out new leaves.
There is a pattern to life that is satisfying. It is also satisfying to know that I am free of "the system" to a large extent.
Todd
Todd,
I have a feeling we're working on the same wavelength. And boy-o-boy, making firewood IS hard work, even for a young pup like me at 52! But so rewarding! I especially enjoy working with my horse to get the logs in. It is priceless. Oh wait! I forgot - it's terrible inhuman drudgery here on the farm! ;-)
I have a substantial vegetable garden, I have apples and peaches and blueberries, chickens, sheep, border collies to hassle the sheep, etc. and so forth. This year's garlic was planted last Fall and is waiting patiently (I hope) under a couple of feet of snow. Peas usually go in on Tax Day around here (central NH), but maybe not this year :-)
Yes, it is a lot of work, but it is not stressful work. You pace yourself, that's all. It's not like you're ever going to "finish" all the work that could be done!!!
I think it is important to stress (there's that word again!) that along with the work and the skills, there's an attitude that needs to be cultivated if someone is to be content with this kind of lifestyle. The boundaries between "work" and "recreation" and "daydreaming" and "appreciating the moment" sometimes become somewhat fuzzy when you're in the zone, as it were.
Please get here soon, Spring!
So how efficient would bamboo be as firewood? I know you have to bust it up so the cells don't pop, but at least it's easy to haul. (Living in a place that's got banana trees next door, but also several severe Canadian fronts per winter.)
Sgage,
We have blueberries, strawberries, red and black cap raspberries, black berries, grapes (mostly eastern - we're at 3,060' and our climate is more eastern than California) and red and black currants. We also have nuts; english and black walnuts, filberts and an almond (The last two have been losers for us.) We also have a couple of persimmons.
A couple of wired crops I grow are quinoa and, for my area, a little winter wheat.
We did have chickens and rabbits but we gave up on animals years ago because of the varmints - we have bears (which ruined our beehives and raise havoc in the orchard now and then), bob cats, coyotes and a very infrequent lion. We used to have several lions around and they wiped out the deer population. They were frequent enough that my wife stopped walking our road for exercise because it was too potentially dangerous. I even tracked them around our house.
Ah, the joys of the country...wouldn't trade it for anything!
Todd
PS My peas are about 1" high. March is usually our snowy month and I protect them. BTW, I just read an article some place that soaking pea seed for 24-36 hours in Vitamin C greatly increases their growth.
Yes, we're on the same wavelength indeed!
I've thought about quinoa, just for something different, and to make a stab at a grain. Thought about trying barley. So many things to try!
We have no lions here in NH (yet), but we are beset with coyotes and foxes and fishercats and weasels. We're very careful about the sheep, but the chickens get taken now and then. Not much to do about it - just trap 'em out as you can.
Best wishes to you for a golden fruitful growing season!!!
FWIW, Seeds of Change offers three varieties of quinoa. Gourmet Magazine has a quinoa recipe now and then. There may also be some in The Encyclopedia of Country Living...I forget.
The advantage of quinoa over other grains is that it has complete protein so you don't have to mix and match like beens and corn.
Todd
Todd-
You're in Oregon right? I have property in Clackamas CO that I hope to turn into something very similar to what you have. I'm heading back in late April or early May (in Colordao now) and would love to see your operation. If you'd be into that, shoot me an email @ eisleronthemountain@yahoo.com .
TtheD,
I'm in northern California, Laytonville to be exact. Follow Hwy 101 south from the Oregon border. I'll drop you an email tonight or tomorrow. BTW, it's not a good idea to post a "usable" email addy. Mine is detzel at mcn dot org. See the difference? This way it won't be picked up by a bot or something.
Todd
oops.
"Getting up and working 14 hour hard labor days on the farm is not stressful?"
No, that ain't stressful. Probably works in the opposite direction. Why don't you volunteer for a day and try it?
NICE!
BZZZT!! Strawman argument.
WT never said that was the only way to ELP. And in fact, WT was embracing Alan Drake's call for things like "a condo on already electrified rail" before you made your first post here at TOD.
The essence of ELP is to simply become a producer of essential goods or services. If they are not essential, they will get axed. The point of living below your means was demonstrated by the S&L debacle in Texas in the 1980s - being able to take a pay cut meant still having some sort of job instead of NO JOB AT ALL.
Given that WT has stated this over and over again, I am left wondering why you are so eager to pick a personal fight with Westexas?
"P" (produce) can include a bundle of small things instead of just one big thing. For example, my "P" project this year (in addition to continued expansion of fruit & vegie production) is beekeeping. Once I'm up to 2 or 3 hives in a couple of years I'll be producing surplus honey for sale or swap, and I can ramp up production further if needed. This is something lots of people could do on the side. (And a lot of people are here in WNC - 300+ people at this year's new beekeeper school!)
Where about in WNC are you?
Tired to relo there in the early 90s - may (or may not) be able to do so one day. Smaller "zero energy" digs. But I/we promise not to be one of those Floridians that is ruining the mountains.
ptoemmes at bellsouth dot net if you prefer.
Thanks,
Pete
I'm about 20 mi from Asheville, prefer not to get more specific than that on this public forum. We're probably already exceeding carrying capacity around here, but what the heck, who isn't?
"Out of curiosity are you going to take responsibility if your predictions are wrong about such a large majority of people working on farms."
I will. From my post in yesterday's Drumbeat.
Post #300 something so you might have missed it.
"They no longer have the power to demand wage increases to keep up with rising costs."
I remember Reagan and PATCO.
Crushing the Union was Job 1.
And now here we are, debt slaves because we couldn't make ends meet
any other way.
While wealth disparity rivals the Roman Imperium.
"In a nation of outsourced blue-collar jobs, shrinking incomes, vanishing medical insurance, rising fuel and heating costs, and net-zero personal savings, the anxiety level of the struggling classes has to be appeased politically, and one way to minimize the current cost of that anxiety is to charge it off to posterity and the public interest."
http://www.alternet.org/environment/79282/?page=3
"...which I have taken to calling the "Long Emergency."
In this new era, coming soon to a 21st century region near you, the formerly industrial nations will have a great deal of trouble keeping the lights on, getting around and feeding their people. Vocational niches by the hundreds will vanish, while the need to make up for a failing industrial agriculture, with all its oil and gas inputs, will require a revived agricultural working class in substantial numbers. This is, in effect, a peasantry, and the word itself obviously carries unappetizing overtones, especially among those who used to be certain that the perfectibility of both human nature and human society were at hand."
We're here.
"When the most dedicated servants of the system awaken to the realization that they are not benefitting from their service as they'd once believed, that their near-religious faith in the System has been bruised by the grim knowledge that the few are benefitting from the lives and sacrifices of the many, then they simply quit, or move down the chain to an undemanding position.
You can still work in law without having to bill 80 hours a week. You can resign your commission at 20 years and go live on a farm and leave all the headaches behind. You can resign from the commissions and boards and "career-enhancing" stuff you've crammed in after your regular hours. You can refuse the offer of the position of supervisor, or manager, or head of sales, because you now see the extra pay and phony prestige isn't worth it.
In a way, a belief in the value, transparency, trust and reciprocity of the System is like a religious belief."
http://www.oftwominds.com/blogmar08/belief-fades.html
We're here because you can't eliminate refineries or
their workers and then recall and restart when gasoline
crack spreads get large enough.
But raising gas to $5 will crush the economy.
What would you do?
And as I said yesterday, can you point me to a single example of a society in deep economic trouble where substantial numbers of people have dropped out in the way you suggest?
They will be working harder than ever to provide for their families as well as they can.
Just re-stating your proposition without dealing with any critique doesn't make your argument any more true.
It is completely false.
Of course, lots would probably not be able to find a job, but that is entirely different to that which you suggest.
Being out of the system is great, until you need to buy some medicine or anything else modern society can provide.
Thank you, Dave, for replying.
I wasn't going to post my reply to your post,
yesterday, unless someone did.
Forthwith:
""Perhaps you can point me to somewhere where anything remotely like this has taken place when the economy has got into trouble.
People, at least in any substantial numbers, aren't bout to tune in, turn on and drop out."
Me. Exactly what I did back in 2003.
Before that really. They kept promising me raises,
entitlements while pushing me to come up with increased numbers immediately.
I was able to do that all the while cutting back my responsibilities with each failed promise on management's part.
Of course I saw this coming with the Stolen Election of 121200.
Got to plan ahead!
We're not talking debt slaves here (the reason us Dirty
Fckin Hippies keep saying "Get out of debt!),
we're talking the Young Turks. Those VIP's who
actually make Society work.
Lead story at LATOC now:
The Elite Have Passed Out On Massive Volumes of Their Own Kool-Aid, Now The Middle Management Class Awakens
Yes, there are elites in every human culture (and in the social apes as well). But unlike a troop of chimps ruled by an alpha male, today's elites cannot operate the vast complex structure of the the U.S. economy, government and society themselves.
Lose these and Society crumbles.
I don't doubt that some people will make an individual choice, but with respect, you are not 'a substantial number of people!' :-)
When times get really tough, people hang on for dear life, they don't pack in their job.
Look at the number of people in Iraq willing to risk being policemen - with cooking oil at the price it is, and food too, they can't afford not to.
The thing is, though, most people don't have the ability to earn more money by working longer hours in their full-time job. Just because they want to work overtime doesn't mean the work is available. Thus, for many people extra work means moonlighting on the side in something different -- which almost always means something that doesn't pay nearly as well, and often only minimum wage or slightly above. Factor in the fact that all of your tax withholdings on the 2nd job are going to have to be at your top marginal rate, and that you are going to have to use after tax dollars to commute to and from that second job, and many people will find that they are actually only earning a few dollars an hour at most. Pay for child care or buy fast food rather than fix their own meals, and they are likely actually losing money.
Growing their own food and doing other things to cut household expenditures or making some handcraft to sell or swap might very well be a better use of their time.
In many parts of the world people only earn one dollar for a whole day's work never mind a few dollars an hour.
These particular things (and services) are becoming less and less affordable to us the 'great unwashed', hence the incentive to 'drop out.' Have you never heard of the 'black market' economy? More and more people will become dependent on a revenue stream that the govt. does not take a part in. This has become the only way the 'little person' can redress the inequality of the income in the economy where the deck is heavily stacked in favor of the wealthy since the wealthy are heavily subsidized by the govt.
This may, if it goes far enough, serve to give the tottering economy a final push to send it crashing down. This will undoubtedly hurt for all. In my more cynical moments, I liken it to the parable of Samson pulling down the temple on himself and all the Philistines together.
But that's not what Americans work for. Their weekly hours of work has been rising since 1967, but their money and credit seem to go to buying houses twice as large as they need (have you ever been to an American suburb, Dave?) located twice as far from work so as to get somewhat lower costs. Their cars are mindbogglingly huge. Imagine a dense 1920s neighborhood like mine where EVERY driveway has one or more 5000 lb SUVs, where people can barely maneuver out of their driveways in the morning.
As for the idea that all this work was intended to buy medicine: I worked at a tax place one winter where, honest-to-God, our mission was to take phone calls from car dealers who had talked suckers into pledging their income tax refunds towards the downpayment on those silly vehicles, thus requiring us to do their 1040EZ tax forms before they came to their senses and ran from the showroom. Since you can't file an EZ if you're putting money in an IRA, I realized how few Americans were saving even when they could get a tax break out of it. So fat chance that they were going to divert some of their money to Republican-touted medical savings accounts.
People work and spend to get more things they want, and then when a foreseeable crisis hits they can't afford what they need, and plead ignorance. This is a matter of upbringing, not rational actor models, and it will take at least a generation to change.
I have been to the States, but not since 1982.
I agree in many respects, and think that those suburbs are going to suffer, and those huge SUV's look foolish.
Much of current spending is not needed it seems, absolutely, but once again people have such a huge range of incomes, particularly in the States, and plenty are struggling to provide the basics, although maybe they spend some on things others don't think they should.
FYI the Brits are deeper in hock than the Americans- not so many SUV's but everything here costs vastly more, the pound is ridiculously over-valued, and a quite modest car is pretty expensive here - not that there aren't a lot of Porche's too.
Anyway, the fun will stop about now, that's for sure.
See the collapse of Rome for mass examples of "opting out" of the existing social order. Ah, but according to you this can never get that bad.
Ok, disagreement on a fundamental level so we're going to have to agree to disagree. Different assumptions and given that I feel there is not time to sit and argue about it anymore, I'd rather just point out that differing assumptions lead to differing conclusions. That doesn't make the doomers right or the cornucopians right. Assumptions simply are part of what we do as we reach for conclusions and try to grasp some semblance of tomorrow. We'll only know who is right when tomorrow arrives.
If that is a reply to me (these threads can get confusing) I assure you that whenever I ask a question I am pleased to get information, and also I would not jump to conclusions about how bad I think things can get - I just don't think that we are inevitably doomed, or at least it is sensible to act on the assumption that we are not, but that does not preclude some nasty options - none of us really know, IMHO.
Unless you have specific references which you are referring to about Rome though, they are a bit difficult to trace, unless you are just talking about the occasional 'in partibus agricolarum' moment from some aristocrat, usually one who had been more embarrassed politically than Spitzer.
Ovid at least certainly did not share the sentiment, and by and large in the absence of further information from yourself I will continue in my assumption that life in ancient Rome was just too darned difficult for too much sophisticated withdrawal from society - you could make a better case for ancient China, where it was very much part of the Chinese tradition, or for India.
Somehow I can't see America going that far in pursuit of the contemplative life anytime soon!
Rome flat out withdrew from areas near its end, abandoning them to their own means (if any). Britain was an extreme example of this but it occurred in Northern Gaul, in North Africa and elsewhere as well as the empire began to shatter. Those areas had no choice but to reorganize their lives in a different manner than that to which they had previously been accustomed.
I am not suggesting some sort of philosophic contemplative life, but rather a serious reorganization downward in complexity simply to survive. Is that the end of civilization? Maybe, maybe not. But it's the end of the current way we live if it occurs.
You lost me there! I thought we were discussing individual withdrawals, rather than abandoning territories.
I suppose on the great 'localisation' debate I'm pretty well, well, localised!
It seems to me that it may well vary from area to area, as after having had time to think about it it seems clear that at some level of low energy input localisation would indeed occur.
The difficulty is in determining how extreme the energy drop-off would have to be for that to happen - after a mass die off such as some here hold probable, certainly, but how about less extreme scenarios?
To take one case, I can't really see China having to significantly localise, or at any rate no more than it was in, say, 1960, as it is only recently that they have had much energy to play with, and they have vast numbers of coal plants built which aren't going to run out anytime soon, and at least politically they won't be making any strategic withdrawals from any of their territories.
On another continent then the pressure on France would seem to be relatively slight, compared to their peers, as having 80% of your electricity generated by nuclear energy does come in handy in an energy crunch, as does having the technology to build reactors for others to pay for the goods you need.
I suppose I think 'probably' localisation will happen in 'localised' areas!
Short of major war, I doubt it for the world at large - but I reserve the right to be wrong! :-)
Workers of the world, relax!
Out of curiosity are you going to take responsibility if your predictions are wrong
Let me ask you the same question. You man enough to take responsibility for your statements?
First off Eric I don't make statments or suggestions for what people should do, I never advocate people going out and buying anything. I only show some exciting research and development going on in the world, nothing more, nothing less. Good day my friend.
And if you bounce enough "Look at how we became millionaires investing in real estate scams!" infomercials off people's gullible retinas, they become incredibly resistant to the idea that they need to protect themselves against a worst-case scenario the way their forefathers used to. Same for stocks, same for energy, same for the invasion of Iraq. Rich white men will solve our problems for us - time to vote ourselves another tax cut.
WestTexas wrote "Is oil going up because of a falling dollar, or is the dollar falling because of high oil prices?"
I encourage anyone who wants to predict or understand future risk to read the Mulamadhyamikakarika (translates roughly as The Fundamental Wisdom of the Middle Way).
This is a text that critiques the way we view the world. In one chapter it trenchantly shows that causation, as we understand it, is fraught with logical contradiction and can't possibly be True. Understanding the world as cause-effect is a useful "pretension" until it is isn't useful.
Instead of wondering whether the dollar chicken or oil egg came first, try to understand the holistic nature of poultry. Then you will understand in a profound way what others do not see. You might also profit.
Oh man, I really hate when people bring up the chicken and egg issue. That answer to that question determines much of your world view. If you are a creationist, or an intelligent designer, then the chicken came first. If you believe in the scientific method, then you are 99.99% sure that the egg came first, a mutation hatched by the Ur-Chicken.
Here, we know that the dollar came first; but after oil appeared, the dollar mutated from a shiny gold piece, whose supply was determined by the serendipity of geologic finds, to a piece of green paper, whose supply was determined by the stupidity of economic minds.
My favorite is the Evolution of the eye.
The best estimate of the age of the solar system is 4.5 billion years and that is an incomprehensibly long time. Plenty of time for things to develop that would look amazing or supernatural to us who are only here for maybe 100 years if we're lucky.
and whose worth was determined by the serendipity of geologic finds...
It seems that all fiat currencies may be headed toward the same end, but in the short term, it seems to me that there is a fundamentally good reason for the dollar to decline relative to the Euro. Per capita energy consumption in the US is twice what it is in the EU, so it seems to me that the US economy is being hit harder by rising energy prices than is the EU economy.
I agree with your thinking on this 100%.
Not really. The US does have vast energy resources of it's own that it can harness. Also it's high energy consumption should make conservation easier. Europe has little indigenous energy and all the easy energy conservation gains have been made. Things look a lot worse for Europe.
Most of the EU has a viable Non-Oil Transportation alternative. The USA is full of Drive or Starve Americans.
The EU is in better shape, most Europeans can live their lives with little or no direct oil use (with substantial inconvenience and reduced travel). Most Americans cannot.
The EU exports enough to pay for what they want, the USA does not.
Alan
IMO the other problem for the USA is that most government initiatives (including any taken in the future to deal with oil depletion) invariably centre around the grift. IMO, countries like Mexico will not do very well in the future, and the USA is becoming more like Mexico every day.
That's got nothing to do with the US/Dollar value. Consider that the ECB hasn't cut interest rates since the credit crisis began. The US Fed is bent on trying to keep credit cheap to keep financials afloat, while the ECB is trying to curb inflation. If the Fed raised interests rates above 6% the US Dollar\Euro value would shift back towards the US dollar. Like the US, the EU is a net importer of oil and natural gas.
Over the long term, the EU has some serious problems. It as about twice the population of the US, a fraction of the energy and natural resources, and super huge entitlement programs (much bigger than the US entitlements).
While I agree with most of your statements, you do have a habit of linking every issue with energy supply.
There are several reasons the ECB can pursue a different interest rate policy, but the relatively smaller economic impact of rising energy costs is arguably foremost among them. Higher productivity per unit of oil consumed in Europe provides the ECB manoeuvrability denied the FED. Floating the 'financials' is not the objective of the FED's interest rate policy, but the perceived means to avoid a full blown economic crisis.
The rising price of a barrel of oil presents second order problems to the world's economies, mostly related to friction in the recirculation of 'petrodollars'. We are primarily dealing with stresses issued from the growing shift of resources to the production of a supply of oil available to that larger part of the economy dedicated to providing utility. At this level of stress, the energy efficiency of an economy is critical to its robustness. Which is not to say that other factors are not at play.
IMO, if the FED raised interest rates to 6%, the USD would sink even faster, following the US economy into the abyss. Purchasing power is earned and the US simply isn't earning enough to support its pretensions.
To some degree every issue is linked to energy supply. Energy supply is only irrelevant to the dead.
Nope, Higher interest rates would drive down consumption of energy. Consider how much energy was invested in the global real estate boom. Cheap and easy credit permitted people to buy homes, cars, vacations, you name it. All this consumption increased energy consumption. If the Fed never cut interest rates back in 2003, the boom would have never happened. Its likely that a period of disinflation or even deflation would have occured instead, cutting consumption and debt. Had US consumers had spent less money to purchase imported good it would have also resulted in less economic expansion overseas. While it would not have stopped India and China from expanding, the rate of growth would have be much less.
Even if the US raised rates today, the cost of credit would become much higher for consumers, they would be forced to start paying down debt instead of increasing it. This would help restore the credit worthyness of the US, and the amount of consumer debt would fall. Demand for US dollars would rise, as consumer paid down debt reducing the over all currency in circulation. The more the Fed and Congress tries to flood the economy with dollars (with credit) the more diluted the US currency becomes. Every time the Fed cuts rates or creates a new vehicle for borrowing (ie TAF), the dollar takes a dive. If the US raised it rates, it would force other nations (such as China and India which are already suffering bad inflation) to raise rates. Thus it would also cause a reduction in energy consumption in Asia.
I disagree, the Fed objective is to prevent large banking failures that would result in deflation. The Fed will use what ever means it has to float the financials for as long as the can. Although it is a pointless excerise because many of them simply over leverage (~ 30:1 or higher), and can't be saved. But by trying to float them, they are now risking the dollar, and if the dollar collapses so does the US.
"We had to destroy the village in order to save it".
Jim Rogers, and Peter Schiff, have been strongly arguing that the Fed needs to raise rates to prevent an economic collapse. I recommend you read their published articles and comments to get a better understanding of why higher interest rates are required.
Since the UK is in a deeper hole than the US, it will be interesting to see how things work out.
Interest rates are theoretically done independently, and more importantly the UK is closely associated with Europe, where the great priority is control of inflation, so I doubt that the UK will be able to get away with as cavalier an attitude to inflation as the US.
When the budget calculations come horribly unstuck, as I think they will, then we are likely to see really serious deflationary measures here.
I am assuming that even after the election the US continues to shy away from deflating, so it will be interesting to see how the laboratory experiment pans out by comparing the two.
In mathematics that is the different between explicit formulas, and implicit formulas for example is you want to know both X and Y below (and you know what A and B are):
X=37+2*a -b*b ; Y=11-a +a*b
you just plug in the values and calculate.
But most things are implicit, kinda like X,Y are all mixed up in the equations:
X=x/2+2*a -b*b-.1*y ; Y=11-a +a*b +x/y
These are trickier to solve, but (usually) not a major problem for people who know sufficient applied math. You will not for explicit formulas its like the traditional causative thinking: A and B cause X and Y, but with implicit X and Y also "cause" X and Y. It is hard for some people to think in this manner. But it is entirely possible for properly trained people to deal with.
The egg came into existance way before the Chicken or even any birds existed. Eggs existed even before any animal ever walked on land.
Oils up because supply demand is high, and also because the dollar is falling. The real question is will demand ever fall to the point prices will decline significantly caused by a major global recession. There are simply too many variables to make a sound prediction. Even if the world demand falls, prices could remain high caused by war/production contraints/hording/etc. Over the long term the price of oil has only one direction, since its is a finite resource and will remain in demand as long as man walks the earth and retains the knowledge to harvest hydrocarbons.
Hi westexas,
Regarding the Export Land model and the geometric increase in oil prices. I agree in principle, I just wonder if it will really work out this way in practice.
For example, in a lot of exporting countries, oil is cheap because of government subsidies. Are we sure they will continue? As oil prices rise, powerful importing countries will almost certainly put lots of pressure on these countries to lift the subsidies and thereby export more oil.
Exporters will be caught between upsetting their constituents by removing popular subsidies, and angering militarily powerful importers. It's not clear to me which force is stronger - different countries will probably behave differently depending on their particular circumstances.
This strikes me as source of instability in the future, and one way things could get very bad very quickly.
In our top five article we looked at the UK and Indonesia.
UK: High per capita income, high energy consumption taxes, virtually no increase in energy consumption
Indonesia: Low per capita income, energy consumption subsidies, fairly rapid increase in energy consumption
IMO, virtually all net oil exporters fall between the UK and Indonesia in terms of per capita income, energy taxes/subsidies and rate of change in consumption.
The UK went from final production peak to zero net exports in seven years, Indonesia in eight years.
Hello again,
Thanks for the response, but you really didn't address my question. The data you have for the UK and Indonesia is great, but both of them went from exporters to importers at a time when oil prices were not absurdly high and the global oil market was functioning well.
That may not be true in the near future.
Let's fast forward 10 years into the future. Let's assume world exports are only 1/2 of what they are today. Rich importing countries are being squeezed, and are bidding against each other on the global market, and oil prices are very high ($400?, $500?).
Importing countries are certain to put pressure on exporting countries to export more oil. They will vociferously protest any subsidies the exporting countries are providing to their citizens. They may do more than protest, i.e. threaten intervention. The case histories you cite above may not be a very good guide of what will happen in such a situation. The Export Land Model may fail at that point due to military intervention, or due to the elimination of subsidies in exporting countries due to international pressure, etc.
My other point was that this kind of pressure can lead to outcomes which make the situation spiral out of control very quickly - ending subsidies can lead to a revolt, taking production offline, or interventions can lead to escalating conflicts, etc. This kind of vicious cycle is my greatest worry.
IMO, high oil prices will primarily serve to accelerate the net export decline rate. I have theorized Phase One and Phase Two net export declines.
In Phase One, the cash flow from export sales increases, even as export volumes fall, because of rising oil prices.
In Phase Two, the cash flow from export sales declines, because rising oil prices can't offset the decline in export volumes.
In Phase One, the economies in exporting countries (especially those with energy subsidies) should be stimulated, resulting in considerable increases in consumption, e.g., Russia is on track within a year or two to become the biggest market in Europe for new cars.
It it a little ironic that extremely high per capita energy consumption countries like the US would be offended by the prospect of exporting countries, generally with a lower per capita energy consumption rate, consuming more of their own energy.
In any case, the real short term Export Land Versus High Oil Price test case is Mexico, and the current data don't look too promising.
I don't know what the future will be, but the current example of Iraq or Nigeria seems to indicate that military might doesn't produce increased flow of oil, it is effectively forcing hoarding by producing below the optimum rate - in the future any oil will be produced at a profit - using the military doesn't seem very cost effective, it makes the cost of a barrel of oil imported into the USA very expensive indeed.
Don't confuse subsidised gasoline with low cost unsubsidised gasoline or unsubsidised crude oil.
Importing countries are increasingly sourcing energy from state controlled companies - ie: not a free market, and often not a democracy!
The cost per nationalised barrel in many Middle East countries is now a very small part of the export price - so, they can afford for their people to have low cost fuel and still make a profit - if they can limit their exports they maximise their future earnings.
OK, perhaps I should have said cheap energy, or maybe cheap gasoline.
Also, I didn't mean to say that military intervention is a cheap way to get oil. I simply meant to say that importers will eventually be under extreme pressure as the price of oil rises. Military intervention may then be a very tempting option for a powerful importer.
Besides, even though production may go down after a military intervention or occupation, intervention may still make sense for the occupier if they can't otherwise afford the oil on the market or in general obtain it by other means. Getting 1mbpd for yourself is better than watching others consume 2 mbpd.
Well beyond threats from their customers there are economic reasons for removing/reducing subsidies. If the internal economy "wastes" oil because of market distorting subsidies, then there is less oil to export meaning fewer government revenues. The issue is one of getting the population to understand that the subsidies are actually hurting them more than helping them. That can be tricky because it is easy for people to see the direct effect of the subsidy, but not the indirect effect of lower internal consumption leading to a better national economic result. We have a similar problem with oil/gas taxes (even with offsetting tax reductions elsewhere), it is too easy for the public to see the direct effect, but ignore the indirect effect of the policy change.
Also the oil exporters are accumulating financial assets, which are mostly invested in the international economy. Using the worlds oil in a nonoptimal fashion (by having price distortions) hurts the value of these investments. At some point when the oil is gone (or no longer a major driver in the world economy), all the former oil exporters will have left are these investments. They need to consider the effect of their own actions on the value of such assets. The current course the world is on would seem to be one where a great deal of the worlds wealth will be owned by those who have significant amounts of postpeak oil to sell.
Pittsburgh area's roads get poor marks The future is now. Not enough money or energy to repair the infrastructure. Adventures overseas are depleting what is left of our economy, converting all energy to entropy -- the thermodynamic "heat death" of our universe. Monochromatic gray goo world ahead -- will make the old USSR look good.
I wouldn't jump to that conclusion based on Pittsburgh roads being bad. I daresay you could pick any past decade and find plenty of news stories about the roads being bad in certain metropolitan areas.
Sorry, Jim, but the state of the nation's bridges and other infrastructure is not a fantasy, but a real problem.
Look at the GDP spending here:
http://www.data360.org/graph_group.aspx?Graph_Group_Id=1020
Minnesota disaster highlights poor state of US bridges
http://www.guardian.co.uk/world/2007/aug/03/usa.ewenmacaskill
Little action as some 160,000 US bridges are considered to be structurally deficient
http://www.citymayors.com/development/us-infrastructure.html
BRIDGES - Infrastructure Report Card
http://www.asce.org/reportcard/2005/page.cfm?id=22
Cheers
I don't doubt it's a real problem. I also don't doubt it's always been a real problem.
It hasn't always been a real problem. For one thing, most of our infrastructure was built relatively recently . When we planned the interstate system, it was with a 30-40 year expected lifespan. We never imagined we wouldn't be able to afford to build all new highways and bridges when the time came. Heck, some people thought we'd have flying cars, like the Jetsons, and wouldn't need highways any more.
We also didn't realize how dependent we'd become on our new infrastructure after we built it. We can't just rip out the old road and build a new, bigger one.
The problem is being exacerbated now by the high price of oil. It's increasing construction costs by crazy amounts. And fuel is taxed per gallon, not per dollar, so when people cut back due to high prices, it means less money for roads and bridges.
We can't just rip out the old road and build a new, bigger one.
No, what should happen is private citizens land should be taken for the private profit/use of the new infrastructure.
"Not enough money or energy to repair the infrastructure."
I think that's over-interpreting a rather bare-bones article. At least for the time being, there's little need of any explanation beyond plain everyday NASCAR-moron stupidity.
After all, there's gobs and gobs and gobs of money and energy swilling the Pittsburgh area (as well as Minnesota, land of the former I35W bridge.) It's just that politicians don't get votes for maintaining infrastructure. As the very name conveys, the stuff goes unseen. Maintenance is even less visible. The average voter, too busy yakking aimlessly about absolutely nothing on the cell phone to see the huge semi blocking the lane up ahead, certainly will not see it until something breaks.
No, politicians garner votes for lavishly and visibly subsidizing such crucially vital services as moronic entertainment. It follows logically that, in Pittsburgh as elsewhere, The Great Shiftless Moron Mass gets boatloads of lavish stadiums serviced by crumbling roads and dodgy infrastructure. That's what it votes for, exactly as it did when oil was $10; today's NYMEX price has little to do with it. It's simply democracy in action. I wouldn't bother holding my breath waiting for it to change.
No kidding. Nothing says more about the bankruptcy of modern ideology than voters who turn down a public school bond issue and then approve a private stadium subsidy. If they care that little about the future there's no chance they'll pay for the really hard stuff.
Paul S:
Bang on. I work for a school board (responsible for HVAC and Electrical Maintenance and energy management for 120 schools). Trustees and provincial politicians drool over photo ops for new school ribbon cutting. Thats way more sexy than actually maintaining the existing schools....... Hey look what we did!
Hi ontario,
This is a suggestion, perhaps quite on the optimistic, naive side, but...I have seen one example of it, namely, a "greening" of buildings, when the local culture sees "green" as "cool" (or "hot" or whatever...) - LEED certification, etc.
Then you can have a ribbon-cutting for the successful "greening" of the building. Doing energy audits, and, in fact, the whole makeover does not appear to be that difficult...can be fun, if people are into it.
Then there are the school organic gardens...anyway, maybe some possibilities there.
Methinks this is very sharp.
Today I fly off to look for a nice piece of agricultural land in a tight-knit community. Third time’s lucky. Wish me luck.
Cold Camel
Check out this peak oil paradise:
http://www.peakoil.com/fortopic37678.html
Check out this link about Micro dwellings.
http://www.n55.dk/MANUALS/MICRO_DWELLINGS/micro_dwellings.html
The rest of their website is also rather interesting.
"This is even without considering the dollar effect, which raises an interesting question. Is oil going up because of a falling dollar, or is the dollar falling because of high oil prices?"
I think this a very salient point.
The dollar valuation for oil occurred back when the US produced most of the world's oil. Once we became a net importer we were in danger of incurring debt as a result and devaluing our currency. As we imported more and more, it became a monetary security/national security imperative to keep the cost of oil down in order to limit its affects on the dollar. It was a huge benefit to the US to have cheap oil traded in dollars by all involved. It gave the US liquidity and influence over the economies of exporting nations. The dollar was further supported when oil regimes bought treasuries in order to become a stake holder.
Now the US oil import binge is a 1.1 billion dollar per day liquidity hemorrhage. Our massive imports, some of it on debt, are eroding the very currency oil is traded in. Oil exporters must sell oil in dollars but are at risk when the nation whose currency they trade in is harmed by rapid increase in value of the commodity they hold. They are left with a Faustian choice of either to sell dollars and risk ruining one of their major customers or reinvest oil profits in US assets and pray we weather the storm intact.
The dollar has survived more or less intact for so long due to this dynamic. But pressure is mounting now more than ever and more countries are beginning to shift to basket or regional oil currencies. This may well be more a sign that some countries are also moving to keep more of their production for domestic markets. After all, it makes little sense to trade a primarily locally sold commodity in a foreign currency.
So long answer to a short question that may well have been rhetorical. But IMO, yes, the fall of the dollar is a factor of the rise in oil prices. Or better, it is a direct result of oil scarcity and the trend to nationalize/localize a predominantly international commodity.
An article on the BBC
http://news.bbc.co.uk/1/hi/business/7293395.stm
High oil prices and green taxes are beginning to bite the large car/SUV sector - pushing up their depreciation rates and making smaller fuel efficient cars more sort after.
Now all that's needed are similar tax rates in the US.
We just had our budget yesterday.
Booze up, Fags up (sorry - cigarettes...) , Fuel duty in suspension till October. (usual stuff - 'for our own good')
'Green' Taxes: Merc E class, High end Porches etc will get hit by a show room tax of about £950 with a tapering down if your new car emits less CO2.
Hailed as the first 'green ' budget, this is probably the most hypocritical budget, certainly in my lifetime.
If you can afford an E Class Merc, then a 950 quid tax wont change your mind about buying new off a forecourt.
But what really p*sses me off is that deep inside the whole shebang is the extra £550 in National Insurance I get to cough up. Not announced yesterday though. ...So no Solar panel then...
Interesting little factoid about the UK:
Income tax receipts from working stiffs almost exactly equals Social Security payments. It balances now(slightly less on Tax, slightly more with National Insurance receipts).
So what happens when we have a million more or so on the dole?
Add the health service budget to the Social Security budget and these two combined are HALF OF ALL TAX RECEIPTS that UK PLC gets.
Now, If I were the Chancellor, I would be a tad worried about that little factoid, esp on the eve of a recesssion and what with UK Oil depleting at 5% pa (minimum and including Buzzard).
We are so going to pay for this.
If we are lucky, we might just end up with the squalid, tatty, pointless existance as described in the Film 'Children of Men'
Rant off.
I use Gail's figure of 20% of the corn crop to yield 2% of US fuel needs for 2006 to wise up people about corn ethanol; follow that up with its corrosive qualities, effect of mandates long-term, incapability with engines, lack of delivery infrastructure... Well, you know.
So, how'd the yellow
goldlead do for 2007? 40% for 3%?I'm hoping for 100 percent of the corn crop to meet about 10% of US fuel needs. Why? Because corn for ethanol is it's highest economic use at the moment given current price relationships. Feeding it to animals is an energy loser as animals are inefficient converters to human food. Exporting corn is an energy loser since the price of corn currently does not reflect its energy content. The energy lost when corn is exported has to be repurchased from largely unfriendly sources at a much higher price.
As for the other corn uses such as high fructose corn syrup for soft drinks, being diabetic the quicker it stops the better. Surviving Peak Oil is about doing practical things in your own self interest and in the best interest of your own country and locality. Solving our own Peak Oil dilemmas are enough. The US can no longer afford to try to be the savior of the world. The world does not appreciate it or want it anyway. Those who are in difficult situations around the world will have figure out their own solutions such as population control in high growth rate countries.
In any case, as Peak Oil picks up speed globalization should decline making importation of low value coarse grains uneconomic due to transport costs and the lack of money of the poorest purchasers to buy anything.
x said: "The US can no longer afford to try to be the savior of the world."
The US has tried to dominate not save the world, and still continues to try. If you look at the "defense" budget and its future plans, it's clear those controlling it beleive they can still "afford" their attempt at domination.
As for using "100% of the corn crop to meet about 10% of US fuel needs," this won't occur because of the politics of food, as witnessed by the CEO of Pilgrims Pride opening fire on BushCo and Congress yesterday, although I do agree with your contention that closing CAFOs is good for small farmering operations.
Save, dominate, it's all the same to Jehovah.
I deal with Gaia, Isis, and Neptune. An interesting group and far more useful than Jehovah, IMO.
A side note. Remember Lady Liberty or Columbia on US coins and what she supoosedly represents? Well, she disappeared from coins with the onset of WW2.
"Because corn for ethanol is it's highest economic use at the moment given current price relationships."
What gobbledygook!
In economics, we deal with the employment of resources. In this case, the resources are land, energy (daily solar, stored solar reformed as fuel and combined with other scarce resources to provision fertilizer, pesticides and machinery), labour (from farm labour through agronomists to politicians developing mandates) and financial instruments. It is wasteful to the extreme to employ these resources in an effort that produces little, if any, net energy.
This level of wastefulness, as Robert Rapier rightfully explains, is only made possible by ill-considered political intervention in the economic process.
If politicians want to reduce the production of high fructose corn syrup, or to shift consumption from meat to grain, legumes, etc, they can to a lot better than force feeding ethanol to an ill-informed public. They might for example mandate district heating systems fueled by corn, or better yet, switchgrass, in solid fuel form. They might start with public buildings, such as schools, hospitals, government administration centres and so forth. Such a mandate would save a good part of the natural gas and oil consumed by the ethanol boondoggle, leaving it available for truly useful purposes. Hopefully, such an interventionist government would also be taxing fuel guzzling transport out of existence.
Otherwise, end the ethanol mandate, and let the market decide the best use the land, the energy, the labour, and the financial instruments.
Your comments on corn exports regarding energy content, repurchasing energy, USA saving the world, etc., are so ill-informed and downright dumb, I can't be bothered to waste another electron.
Absolutely correct, Mr. X. I could not agree more.
You forgot one point: Higher grain prices means less direct subsidies from the government to farmers, which lifts the burden for taxpayers.
Also: 10% home grown fuel means 10% less money "exporting" to the net oil exporters, which means the money stays here.
Ethanol is a win-win situation.
Anybody have an answer to my original question? Haven't had any luck digging up the figures myself.
http://www.grainnet.com/articles/RFA_Issues_2007_Final_Ethanol_Productio... has the daily production figures (446,000 b/d) but not the percentage of the stock used.
What are Saudi Armaco's yearly revenues? Wiki gives the cryptic unreferenced statement "Estimated over 450 billion dollars. Varies greatly year to year due to high dependency upon hydrocarbon prices." The > DS100 List gives $199,756 million - "Revenue figures are estimates based on 2006 crude oil production (OPEC data) only," as is the case with the other IOCs on their list.
Truth somewhere in the middle?
Question: How well can an oil well flow be controlled? Can well flow rates be reduced without losing the previous maximum flow rate? If a well is capped, say due to a pipeline break and lack of tank storage capacity, will the well come back to the previous flow rate when flow issues are repaired? How much control does the oil industry have to throttle down flow without creating loss to flow?
in general terms, yes(wells can be controlled). for some wells(those producing water, for example), there will be a minimum flow rate. these wells are probably about ready for artificial lift. a flowing well will nearly always come back stronger after a shut-in, short term.
gas wells are a (slightly) different story.
The economic sunshine is unending today...
The next shoe to drop in housing
Carlyle Capital Nears Collapse as Rescue Talks Fail
Recession fears revived as store sales tumble
From Drudge:
Riot police called out to handle huge crowd seeking help with housing costs. "Leave or face arrest."
http://www.palmbeachpost.com/news/content/south/epaper/2008/03/12/0312vo...
Damn WT, foreshadowing events...this hasn't even made it to the 1/3 point yet (according to Fannie Mae, optimistic).
I would point out to those remaining in the optimistic/cornucopian column, what is happening now has NEVER EVER happened before in history.
Asset deflation, price inflation, stagflation(no wage inflation and recession), and commodity scarcity and inflation. And on a global scale.
If you can plug that into a previous event and come back with that 'they didn't eat each other'...get back to me.
We had some of those things happen in the '30s and some in the '70s, but I suspect the leaders in the '70s had learned that double-digit unemployment is a faster road to revolution than double-digit inflation, and chose accordingly. Problem is, the US was less shackled with debt in the '70s, and it still made some of its own stuff.
Now as for whether there was cannibalism in the Great Depression...
'BOCA RATON — A crowd of more than 500 people waiting for hours this morning for housing voucher applications were dispersed by police in riot gear at the Boca Raton Housing Authority when the applications ran out sooner than expected.'
Substitute the words 'Soylent Green' for 'applications'...Interesting that the SWAT team showed up to handle these out of control mothers.
Storm troopers handle all manner of minutae in a police state
What we need is someone there to help organize those mothers.
Interesting that the SWAT team showed up
Not at all. I expect MORE of such, as the PDs have all that SWAT gear and training with nothing better to do.
The turning point will be when someone walks up to a SWAT team gun to put a flower in the barrel or wrap their mouth around the barrel end and gets shot - with the resulting video footage uploaded to youtube.
Last year a man burned himself to death in front of a public statuary in a crowded area in downtown Chicago to protest the war and hardly anyone noticed. People will turn to action only after their own oxen have been gored, and before that they will only look with indifference on the suffering of others. That's why it was so important for the bad guys to dismantle working-class politics in the '80s and '90s.
I remember, I noticed. But I can do nothing on the 'police action' - other than not enroll in the Military.
I could try the radical 'do not pay for war' via not paying taxes, but I've seen people who try that path - crushed by 'the machine' in the end. And I'm just not ready to be a red blotch on the road, run over by the government apperatus.
Man, if that incident had been in Palm Beach instead of Boca Raton, I would have jumped out a window.
"Angelica Rivera, a 28-year-old mother of five who had been pleading with officers to let her drop off her housing application, refused their orders to leave the property. She was handcuffed and dragged off to a police van, charged with disorderly conduct, disobeying a lawful order and resisting without violence. A second person was booked on similar charges."
How is this person a criminal? What utter nonsense.
Here it is.
Hedge funds have stopped redemptions.
Normally this would be the end of it unti the courts intervened.
See Bear Stearns/Merrill Hedge Fund Cayman Islands.
But the Customers of these Hedge Funds are not some
avg investor from Fly Over Country.
These guys are $100 millionaires.
They get their banks to tell these funds that Mr Margin
is calling on Line One.
Make Mr Margin happy or the banks seize the assets.
See Carlyle Fund for details.
Carlyle Capital Corporation is/was the leveraged-mortgage vehicle of the Carlyle Group. Maybe CCC should have been their credit rating:-)
CCC thought it was an easy way to make money, leverage up to 32 times the money they actually had and then make huge profits. Its always the same story borrow more and more to speculate, it just can't go wrong can it? Well apart from south sea, tulips, Florida land boom, 1929, LTCM......
Its no wonder that Carlyle Group set up CCC as a separate entity, they wouldn't want to be responsibe for all the debts would they?
At the end of the day it will be the general public and proper businesses who suffer by paying more interest so that the banks can make back their losses. I bet the CEO John Stomber is unlikely to be foreclosed.
The lenders (banks) have seized the asets of CCC (mortgage backed securities) and hey presto/abracadabra by the magic of the Fed the banks can now switch mortgage-backed debt for Treasury Bills. So once again thenbanks heroicaly turn lead into gold. Just don't mention poor old joe public or how many other leveredged funds are now quaking in their boots.
A difficult to solve problem is that many banks are not being run like businesses. It is very very easy to make a lot of money if you have 55 funds (like Carlyle) and lenders' employees float you an unlimited amount of capital. The owners of these banks are thousands of ignorant shmucks who are being fleeced continually, and there isn't even a plan to discontinue the fleecing (the one public figure making waves has been slapped down but good).
"Slapped down" is for sure -- what is the back story? Sounds like a Mafia operation. The whole sordid affair makes no sense to me -- at least, not what has been put out in the media.
Purely at the level of speculation - If the Mafia wants to be rid of a politician and for various reasons do not want an execution, what then? How make a resignation plausible?
The story in the papers is such evident BS you can imagine most anything. But think like a scriptwriter, not a conspiracy sleuth, 'cause this one you will never know.
From Matt's BreakingNews at LATOC
http://www.lifeaftertheoilcrash.net/BreakingNews.html
The Parent company Carlyle Group news.
Carlyle Group May Purchase Giant Private Intelligence Army
The Carlyle Group, one of the world's largest private equity funds, may soon acquire the $2 billion government contracting business of consulting giant Booz Allen Hamilton, one of the biggest suppliers of technology and personnel to the U.S. government's spy agencies. If it goes ahead with the widely reported plan to buy Booz Allen, it will re-emerge as the owner of one of America's largest private intelligence armies.
http://www.truthout.org/docs_2006/031108H.shtml
For some background on the boyz. With pictures.
How will President George W. Bush personally make millions (if not billions) from the War on Terror and Iraq? The old fashioned way. He'll inherit it.
Meet The Carlyle Group
Former World Leaders and Washington Insiders Making Billions in the War on Terrorism
http://www.hereinreality.com/carlyle.html
Here is an interesting take on the Carlyle situation:
"it’s arguable that the banks’ seizure of Carlyle’s $20bn-odd in assets has actually been encouraged by the Fed’s mortgages-for-Treasuries offer. Because the Fed’s new lending emergency lending facility allows the banks to swap mortgage-backed debt for Treasury Bills in a way that Carlyle could not do"
http://ftalphaville.ft.com/blog/2008/03/13/11564/the-feds-hedge-asset-la...
And this was also making the rounds overnight.
`Investors are getting out of dollar assets and this is going to lead to a dollar crash,'' said Tetsuhisa Hayashi, chief currency manager of a Tokyo exchange.'
``Sentiment for the dollar continues to deteriorate very, very rapidly and if we're not careful this will turn into a dollar crash,'' said Mitul Kotecha, head of foreign-exchange research in London at Calyon
Never fear! The markets are rallying on the good news and have already erased 3/4 of their early-morning defecits. You can never keep an optimist down. We'll see how long the rally lasts.
Not to worry. Sec Treasury Paulson spoke this morning and said that 'America is in favor of a strong dollar.' How many times has Paulson made the same statement? Of course we will find out just how strong a dollar is 'wanted' when the Fed decides on March 18th how big a rate cut is implemented.
I found it interesting that on the day the Dow climbed about 440 points that the trading volumn was light. Light volumn vs PPT = big movements in stock prices for little $ input. Also interesting is the fact that Sqeek Blab doesnt report stock transaction volumn but it is easy to find elsewhere.
Back to Paulson's talk...just that, talk. Lots of committies are meeting to investigate what went wrong, they will make reports and get back to Treasury in the summer (this year I presume) lots of Paulson jaw boning investment banks, mortgage banks, states to require more stringent rules for brokers and loan origination, more transparency in markets, more transparency in the abc world of exotic financial instruments, etc, blah, blah, blah. Paulson doesn't seem to appreciate that the economic damage is accumulating increasing hourly and action 'this summer' might be waaaay too late. Apparently no one is to be held responsible for this train wreck.
Right, and money flows were down. That's the suckers volunteering to get mugged yet again. (I hope that wasn't any of you, unless it was a day trade.)
Here's one comment about Paulson's talk.
Paulson admits deregulation has failed us all - Rex Nutting, MarketWatch
E. Swanson
Sounds like he just gave his Admiral Fallon speech. Resignation soon to follow?
I love to see, how such arrogant billionaires like David Rubenstein loose money. He is a textbook example of a typical US financial guy, belongs to the "elite".
S&P Says End in Sight for Writedowns on Subprime Debt
Woohoo! Par-TEE!
To be serious for a moment, two things strike me about that story. First, is there anyone in finance with less credibility than S&P at the moment? As an example, Deutsche Bank has a bond rated AAA by S&P, and 43% of the loans in the bond are delinquent. Sounds like AAA to me.
Secondly, how could the writedowns be nearing an end, when the peak interest rate resets don't hit until August? We're still in the early days of the recession. Lots of people still have jobs to lose. Foreclosures likely won't peak until months after the interest rate resets peak.
It seems unlikely that S&P is unaware of what its rating standards are, or that much of what they've rated AAA doesn't meet their own standards. The more likely conclusion is that they've given up honest ratings in order to prop up the people who pay their bills (which happens to be the people S&P rates). Today's silly "happy talk" is part of the same effort. If only everyone is cheery and upbeat enough, the world will go back to normal.
Nouriel Roubini of New York University’s Stern School of Business is estimating the financial sector losses from the US subprime mortgage crisis to be around $1,000bn-$2,000bn and I don't think that amount has been written off yet so if he is correct there's still a way to go.
Roubini has had a pretty good handle on the mortgage crisis since, I think, 2006. The optimists were calling him a doomer and a pessimist and more or less dismissing him, at least until last summer.
S&P thinks the final tab is going to be $285 billion. That's one of the reasons I treated their story with derision.
"It takes two lanes of a given size to move 40,000 people across abridge in one hour by using modern trains, four to move them on buses,12 to move them in their cars, and only one lane for them to pedal across on bicycles."
-- Ivan Illich, Energy And Equity, 1974, p.62
Just ran across this quote. Still busy in DC,
Best Hopes for Writing Damm Papers,
Alan
I was thrilled the other day to see my grade 12 daughter come home with Ivan Illich's "Deschooling Society" on the recommendation of her philosophy teacher. In the fall term, the same teacher led her history class, spending several hours on the subject of peak oil. The man recognizes history in the making. He also wisely recognizes that the civilized way forward is tied to changes in the way we live, and not in hopeless attempts to overcome the entropy law.
Best hopes for an increase in the number of high quality educators.
Best hopes that her teacher keeps his job and doesnt get carted off to a re-education camp
Ivan Illich was another Cassandra-type who foresaw the collapse of industrial civilization. Abandoned by French leftists, at odds with the Vatican, demolished by Reaganite positivists -- he died in 2002.
He was right about what was wrong -- but I never could find any useful motion toward a better way in what I read, at least. Too angry.
Leanan, a question or two for you. In what part of CT do you live, and what is your cost for power?
I'm in lower Fairfield County, and we are paying $.1684 per kwh. This breaks down to $.1178 kwh generation, and the rest is distribution and taxes. In the Continental USA, I'm told this rate is higher only on Long Island (HI is higher, but they are stranded).
If you don't want to answer, I understand.
Sorry, don't live in CT.
Oh. For some reason, I thought that came out at some point. Never mind.
Anyone else?
Green;
How much has your Elec rate changed over the last year or two?
Portland, Maine - Currently about .15/kwh including svc&delivery.. don't have the old bills handy.
Bob
I have bills back to Aug-2000 when we moved to CT. At that time, the rate was $.096 per kwh. Rates rose steadily until the back shock that came in Dec-2005 after the Katrina run-up in natural gas and oil. It went from $.13/kwh to about $.18/kwh in about 2 months. Prices have slightly declined since the beginning of 2007, but given the recent natural gas run, we can anticipate further rate increases.
goinggreen, I live in New England (MA), and pay about $0.185 per kwh. That is my average cost, which includes fixed charges; the variable cost comes to about $0.17 per kwh.
New England is highly dependent on natural gas for electricity generation, and the cost of our electricity is going to be almost completely determined by the cost of natural gas over the next couple of decades. Since our electricity is so expensive and so highly correlated with natural gas, I can't justify the large capital expense of retrofitting in a ground source heat pump.
I've posted this article two or three times in the past, but it does a good job explaining the electricity situation in New England.
Study hints power rates to stay high
Hi Calorie, thanks for your response.
In CT, they break the bill into generation/transmission/tax, etc, and part of what I'm after is the generation cost. Your total cost is very high too! I'm interested in comparing different generation costs. Here's why.
I did a quick calculation taking the CT statewide market costs from the ISO-NE website, weighted it by load, and calculated the average delivered generation cost. I got something near $.06 to $.07 for the generation cost, but we are being charged $.11 and higher. The educated guess is that we are charged a forward rate and not the spot rate. If so, that is some margin! To check that, I wanted to compare with others from other areas in the State to see if our unique power situation (we are very short generation here in lower Fairfield Cnty) was the primary reason. Any comments?
The high power cost does indeed cut into the cost-effectiveness of heat pumps. I went with them 18 months ago knowing it would take longer to pay them off. That was over $40/bbl ago. This year, my savings will be similar to what I could earn on treasury yields, due primarily to the higher cost of heating oil (which is still my 2nd stage heat). Given that there is no natural gas line on our street, heating options are few, and I'm really on a program to increase my energy security and wanted to reduce my family's exposure to foreign oil. If you include this reason, it doesn't seem so stupid. Also, I figured fuels costs would be going up for the myriad of reasons discussed continually on this website and was in a sense speculating that the economics of 18 months ago would be surpassed. In no way was I expecting the economics to improve so quickly.
Generally, heat pumps are a spread play between heating costs and power costs. They would seem a no-brainer in the Midwest where coal is king in electric generation.
I can't answer your specific question but I can confirm that my generation costs are also $0.11 per kwh. Electricity is from NSTAR.
I understand your desire to increase your energy security. I heat with gas-fired steam but I also supplement that with wood. Right now I'm thankful I have gas for my primary heat and not oil. Gas is about $1.71/therm and heating oil about $2.65/therm ($3.68/gallon, 139,000 btu/gal). That's a ~55% premium for oil.
I'm in the PG&E (N California) served area. Here the basic rate is $.11 something, but that is for minimal use. Residential customers have a baseline consumption, after passing 100% of baseline rates are 30% higher, after passing 200% of baseline 100% higher, and after 200% of baseline 200% higher (i.e. close to $.35). The baseline is determined by a complicated formula, but for my house it is probably somewhere near 700watts/family. Almost everyones marginal rate is at least $.24, most $.35+.
When you say "almost everyone" I think you are excluding apartment dwellers. As an apartment dweller who doesn't use air conditioning, I don't think I've ever used my baseline.
An interesting anecdote today. I called a local heating oil delivery company to purchase some oil. It is a small family-run company. When I gave him my address, he said "Oh, you are the ones with the geothermal. How's that working out?" He seemed very interested in the technology for himself.
Hi GG,
I'm currently paying $0.1067 per kWh, inclusive, and I believe that's about 28 per cent higher than what it was back in 1996. Electricity had been holding steady at $0.0835 for several years, then in 2003 it went up $0.0861, then $0.0922 in 2005, $0.1013 in 2006 and finally $0.1067 in 2007. By comparison, heating oil and propane have just about tripled over that same timeframe.
My fuel oil provider (Scotia Fuels) is charging $0.999 per litre ($3.76/gallon) and this price has been creeping upward over the past several weeks. Propane is running at $1.25 per litre ($4.70/gallon). At this time, electric heat is cheaper than oil and much cheaper than propane. The [very] small number of homeowners who have access to natural gas are paying $15.156 per GJ (1 GJ = 26.1 litres of heating oil, 39.2 litres of propane or 277.8 kWh of electricity), which makes natural gas a terrific deal if you can take advantage of it.
I noticed the oil truck filled my neighbour's tank again today. They visit about every three weeks during the winter season so I take it they must burn through about 200 or so litres a week or between $25.00 to $30.00's worth a day. I hate to sound nasty about this, but this couple took great pleasure at mocking me for making my home more energy efficient. Bet they'd crap if they knew I heat my home for less than $3.00 a day.
Cheers,
Paul
The good news: the real estate crash has made Florida beach homes affordable. The bad news: don't count on selling it in the future.
Is vinegar the secret ingredient for biofuels?
http://www.news.com/8301-11128_3-9891603-54.html
Cripes, now you are pushing for peak salad dressing?
A few days ago someone suggested stocking up and storing vinegar.
Instead stock up on brewing EQ and how to brew. You can then convert the brewed material and make vinegar.
(you can use vinegar up to 25% in corn as a herbicide BTW)
I have monitored this site and the comments for a few months now but not posted before, but I was personally blown away by the National Geographic Special last night about drilling in the Alaskan National Reserve. While obstensibly about the drilling in the reserve I thought the show did a tremedous job of "sounding the alarm" about just how dire a situation America is in. I know a few of you mentioned here yesterday that you were looking forward to watching it and I was wondering if any of you who did get to see it saw any new information which you found useful or provacative and just generally what you thought of it?
Seperately, do you think that the Bush Administration is actually a very strong believer in Peak Oil and that's really the only reason we are and will be staying in Iraq "forever" (until those wells run dry anyway) and will soon also be taking over Iran? It seems clear to me that the next "Alaska", to the Bush administration at least, is America "owning" the oil of Iraq and even Iran. A nihilistic, misguided, futile plan if ever there was one but the plan none the less? Didn't the NG special kind of make that clear? We need this much oil daily, we won't be getting the share we get from Alaska much longer, American's don't want to change, it's leadership is afraid to even suggest it, so that oil has to be secured and come from somewhere and counting on the OPEC's of the world to supply us with all we need is not a "secure" alternative(I know Canada supplies us with much more than OPEC but I'm talking about filling a growing gap in Alaskan production long term).
Welcome to the doomer camp, Schneid. In answer to your questions, yes the Bush administration is well aware of Peak Oil, no Americans have no intention of changing their ways nor do they want to be told the truth, yes the United States has embarked on a strategy to control the world's remaining oil, yes the conflicts will soon spread to Iran, Venezuela, and sooner or later Russia, and no this civilization doesn't have snow balls chance in hell of making it through this. Some of us are lucky. We're going to be dead soon.
"Some of us are lucky. We're going to be dead soon."
Man after my own heart. What I'm counting on.
The Bush admin and their ilk would like you to believe it is that simple, but don't believe it. In forty years, the USA went from controlling the planet economically to the current situation. It didn't happen by accident. IMHO the whole belief system shared by many Americans which is "our leaders are working to keep America on top" is about to be shaken like never before. The American government has successfully increased the fortunes of the global elite-all major initiatives are designed the same way-how to load costs onto the ignorant masses while flowing benefits to the connected. If the USA manages to somehow conquer Iran, IMO it would be a very good deal for some large oil companies, but the USA taxpayer will foot the entire bill (just like in the growing Wall Street shitstorm) and receive not even a thank you.
I wish I could give you a link to a speech Cheney made in 1999 while CEO of Halliburton. Unfortunately my computer at home is not working. In the speech he said that there would be a huge increase in demand in the coming decade and that the state oil companies (Saudi, Iran, Iraq & Russia) would be an impediment to getting what we need. Also that oil companies really ought to strongarm the political system by a magnitude befitting their importance, like all the other industries.
My belief is that he foresaw the problem, but not the sudden explosion of Chinese consumption. He and other neocons have always viewed state oil companies as the enemy - with the sometimes exception of Aramco. Invading Iraq while withdrawing from Saudi Arabia would send a threat to Iran and then-weak Russia. Bingo, all four major NOCs at one blow.
Cheney's speech is here: http://www.energybulletin.net/559.html
By 2010 we will need on the order of an additional fifty million barrels a day. So where is the oil going to come from?... Oil is unique in that it is so strategic in nature. We are not talking about soapflakes or leisurewear here. Energy is truly fundamental to the world’s economy.
6 Signs the U.S. May Be Headed for War in Iran
March 11, 2008 06:52 PM ET | Permanent Link
Is the United States moving toward military action with Iran?
Edit---
1. Fallon's resignation: With the Army fully engaged in Iraq, much of the contingency planning for possible military action has fallen to the Navy, which has looked at the use of carrier-based warplanes and sea-launched missiles as the weapons to destroy Iran's air defenses and nuclear infrastructure. Centcom commands the U.S. naval forces in and near the Persian Gulf. In the aftermath of the problems with the Iraq war, there has been much discussion within the military that senior military officers should have resigned at the time when they disagreed with the White House.
2. Vice President Cheney's peace trip: Cheney, who is seen as a leading hawk on Iran, is going on what is described as a Mideast trip to try to give a boost to stalled Israeli-Palestinian peace talks. But he has also scheduled two other stops: One, Oman, is a key military ally and logistics hub for military operations in the Persian Gulf. It also faces Iran across the narrow, vital Strait of Hormuz, the vulnerable oil transit chokepoint into and out of the Persian Gulf that Iran has threatened to blockade in the event of war. Cheney is also going to Saudi Arabia, whose support would be sought before any military action given its ability to increase oil supplies if Iran's oil is cut off. Back in March 2002, Cheney made a high-profile Mideast trip to Saudi Arabia and other nations that officials said at the time was about diplomacy toward Iraq and not war, which began a year later.
3. Israeli airstrike on Syria: Israel's airstrike deep in Syria last October was reported to have targeted a nuclear-related facility, but details have remained sketchy and some experts have been skeptical that Syria had a covert nuclear program. An alternative scenario floating in Israel and Lebanon is that the real purpose of the strike was to force Syria to switch on the targeting electronics for newly received Russian anti-aircraft defenses. The location of the strike is seen as on a likely flight path to Iran (also crossing the friendly Kurdish-controlled Northern Iraq), and knowing the electronic signatures of the defensive systems is necessary to reduce the risks for warplanes heading to targets in Iran.
4. Warships off Lebanon: Two U.S. warships took up positions off Lebanon earlier this month, replacing the USS Cole. The deployment was said to signal U.S. concern over the political stalemate in Lebanon and the influence of Syria in that country. But the United States also would want its warships in the eastern Mediterranean in the event of military action against Iran to keep Iranian ally Syria in check and to help provide air cover to Israel against Iranian missile reprisals. One of the newly deployed ships, the USS Ross, is an Aegis guided missile destroyer, a top system for defense against air attacks.
5. Israeli comments: Israeli President Shimon Peres said earlier this month that Israel will not consider unilateral action to stop Iran from getting a nuclear bomb. In the past, though, Israeli officials have quite consistently said they were prepared to act alone -- if that becomes necessary -- to ensure that Iran does not cross a nuclear weapons threshold. Was Peres speaking for himself, or has President Bush given the Israelis an assurance that they won't have to act alone?
6.Israel's war with Hezbollah: While this seems a bit old, Israel's July 2006 war in Lebanon against Iranian-backed Hezbollah forces was seen at the time as a step that Israel would want to take if it anticipated a clash with Iran. The radical Shiite group is seen not only as a threat on it own but also as a possible Iranian surrogate force in the event of war with Iran. So it was important for Israel to push Hezbollah forces back from their positions on Lebanon's border with Israel and to do enough damage to Hezbollah's Iranian-supplied arsenals to reduce its capabilities. Since then, Hezbollah has been able to rearm, though a United Nations force polices a border area buffer zone in southern Lebanon.
All fifty one operational U.S. destroyers are Arleigh Burke class AEGIS ships. All twenty two of our cruisers are also AEGIS equipped Ticonderoga class. The only thing in the escort line that wouldn't have AEGIS are the Oliver Hazard Perry frigates ... so that last bit on item #4 sounds like breathy, mainstream media reporting to me.
http://en.wikipedia.org/wiki/Current_United_States_Navy_ships
I wish I could give you a link to a speech Cheney made in 1999 while CEO of Halliburton.
I wish some one would do a nice timeline with points for significant milestones. The sweater speech, Cheney's '99 speech, This one below in front of CONgress. From 1990ish to 2001ish.
Does anyone remember the rush to the Caspian Sea for oil, headlines like "The New Saudi Arabia" and things like that. (including this speech), then in 2000ish the James Baker study came out, Then Cheney's task force. And the word was out that the Caspian wasn't that much, attentions turned south...
It would be great to see a timeline with these and other significant speeches, Events laid out.
'I thought the show did a tremendous job of "sounding the alarm" about just how dire a situation America is in.'
I watched the show and thought it was released to prepare Americans for what their government has already planned.
'Americans don't want to change, it's leadership is afraid to even suggest it, so that oil has to be secured and come from somewhere...'
Perhaps it is American leadership that does not want to change? After all, when Cheney said 'the American way of life is not negotiable', exactly which Americans did he have in mind? If Americans working for minimum wage jobs here knew what the minimum wage in Switzerland is I suspect they would would be eager to negotiate change. Of course, Cheney may have meant that 'nothing in America is going to change, including adoption of socialized medicine, and minimum wage that a worker can actually live on, etc.'
'counting on the OPEC's of the world to supply us with all we need is not a "secure" alternative'
So, we are to adopt the mindset of the school yard bully? 'I dont have all the ice cream I want so I will take Betty's and little Jim's'. That is a very slippery slope as all empires, and bullies, of the past have found. There is no such thing as a "secure" oil supply, especially if that supply is under another soverign nations land and half a world away. America was a tremendous economic power forty years ago, the worlds largest creditor nation. The very inept, corrupt leadership that has led us to the status of the worlds largest debtor nation is now telling us that they can restore America to it's former glory by a series of wars on Mid East countries that happen to be sitting on lots of oil? Our leaders are going to make everything better by just a couple of more wars? The neo-cons of Iraq infamy will keep this ludicrous economic merry-go-round working far into the future? The rest of the world will sit by while America maintains unipolarity? If you believe that bs you are not a student of history...Nor have you played the simple childs game of King Of The Mountain.
BTW, the amaturish, probing, nature of your post sounds like that of a pollster or spook. It happens that I am too old to give a rads azz if you are working for an abc government agency. How do you like your job? Welcome to TOD. :)
To all Canadians, tonight on CBC:
DOC ZONE: TAR SANDS, THE SELLING OF ALBERTA
Check you local listings.
Hate that we don't get the History Channel Mega Disasters on our History Channel, so we at least have something to watch on our own networks.
See: http://www.cbc.ca/doczone/tarsands/
I recorded the creator interview on 'The Hour' last night. Thanks for the heads up on the broadcast.
Tata story in Globe and Mail.. http://www.theglobeandmail.com/servlet/story/RTGAM.20080313.wh-GenevaTat...
"The folks back in Britain, though, appear somewhat ambivalent. An upstart conglomerate from a former colony buying two storied British car brands? Shocking. More practically, there are fears in Britain of production and component manufacturing leaving for low-cost countries."
UK(and US) are Importing Fuel and Cars, etc.. even the ones they thought were their own..
We're ALL colonies now. So where's the King?
B
I dont know where or who the King is, but I do know this:
Almost all (better than 90%) of medically approved face masks used in the West are made in SE Asia and China.
Best hopes for never, ever having to live through a pandemic.
Off the Grid Freezers/Refrigerators:
I've been looking for a high efficiency 12 volt dc/110 ac freezer for a while now. Although I've know about Sundazer and Sun Frost for years, neither really suited my needs.
I wanted a chest style freezer that worked on 12v and 110ac, yet had a low enough power consumption that it could run off solar panels. Most 12v coolers are of the thermo electric variety. They are very inexpensive and pretty much useless (I have one). They provide little cooling for the power consumed.
Then I ran across the Coleman Stirling Power Electric Cooler. Which led me to the Engel freezers. The Danfoss compressor, in the Engel, is the same high efficiency one used in the Sundazer.
The Engel's is sold by Big Frog Mountain and Cabelas. I consider that a pretty good endorsement, since Big Frog has been doing the alternate energy thing since 1989 and I've always been pleased with the stuff I bought from Cabelas.
Engel is an Australian company, here is their link. They also sell kits for converting an existing cooler or building a freezer from scratch.
I have an Engel 45 Fridge/Freezer. Very happy with it. It uses less then 30 amp hours out of my batteries every 24 hours keeping the food at 18 degress F or below. The temp in the room is 78F at night and 89F currently.
I have it plugged into an inverter that runs both of my Fridges.
I should install a 12v line for it but it was easy just to plug it in.
Ed
Thanks for the real world review.
That's pretty close to what I was guessing on power usage. I'm thinking that one or two 60 watt solar panels should do the trick.
They do not advertise them, but SunDanzer now makes an AC/DC model. It is just a new power board for the same compressor system for about a $75 up-charge. It runs on 120VAC or 12/24VDC, with automatic switchover. Very nice units. I have a DCF165 AC/DC and it is just *ridiculous* how little electricity it uses (about 100 to 150 watt hours/day!). I have not found a more efficient unit sold anywhere.
Thanks for the AC/DC info, didn't know that.
For those who are interested here is a review by homepower magazine of the DCF225.
http://www.sundanzer.com/News_files/HP107.pdf
It seems to use more power than your DCF165, but the review has a nice power/temperature/panels needed graph.
It looks like all 11 grades of crude on Upstreamonline are now over $100.
I just noticed that too. Hard to believe I'm watching this happen.
Chrysler to shutter operations for two weeks
I don't think it has been mentioned here:
Admiral Fallon has resigned. What is your feeling about it?
http://www.officialdisclosure.com/SM-12.pdf
It has been mentioned here. Yesterday's DrumBeat. The day before, too, I think.
Ah sorry. God knows that I'm reading each and every Drumbeat though..
I still love you Leanan. Please don't ever leave us.
The price for a barrel of crude oil should be in euros, not in dollars.
That should ease thing down in the financial markets.
The EU already seems to do so at
http://www.energy.eu/#prices
http://www.upstreamonline.com/market_data/?id=markets_crude
All grades of crude now over $100/barrel...wow, that was fast!!
Brent Blend 109.92
Tapis 111.72
Alaska North Slope 110.04 0
Bonny Light 112.62
Dubai 1M 100.25
Forties 110.87
Louisiana Sweet 111.66
Minas 108.27
Oman 1M 100.14
Urals 105.57
WTI 110.18
Look! It's a Shruburb:
Tent city in suburbs is cost of home crisis
There is also one in St. Petersburg, FL. As more folks lose their homes and jobs will start to see more of them across the nation.
Where in St Pete?
Close to Tampa, FL. West (Gulf of Mexico) Coast of Florida - maybe half way up the penisula.
Lot's of retired and retired ex-miltary as there are VA facilities in the area and MacDill AFB (Tampa) base exchange. Centcom (Admiral Fallon's ex haunt) is based at MacDill, but I digress...
Pete
He asked where in St. Pete, not where is it.
Doh! And to think wars have been fought over less than one letter - is <> in
OK. Kind of dated, but
http://en.wikipedia.org/wiki/Tent_City
In atonement I also offer this reference to one closer to my neck of the woods - until it burned down around Super Bowl time - two SBs ago. Hmmmm.
http://www.nbc6.net/news/13764448/detail.html?rss=ami&psp=news
Pete
Here's a story on a Tram for Des Moines, Iowa. What's Nationwide's angle on this?
http://www.desmoinesregister.com/apps/pbcs.dll/article?AID=/20080311/NEW...
Des Moines doesn't have mass transit besides buses, but the whole downtown is walkable year round thanks to a marvelous skywalk system. Traffic on the east/west I-235 artery is pretty light which is to be expected for a town of a quarter million, but its a good jaunt to downtown - maybe ten miles from the nicer bedroom communities in West Des Moines to the insurance center in the middle of the city.
The article references the "East Village" and I had to go Google to see what that was. The east side of this area is southeast 14th street. Can't speak to it now but this was the dividing line between the Vice Lords and the Lost Boys twenty years ago. I've been there within the last few months for stuff at the capitol and it still looks pretty gritty. Yes, the worst white neighborhood in the city is across the street from the capitol. The governor does no better - his digs border "historic Sherman hill". Some old house restoration, but crack dealing on brownstone porches, too.
The other end of the path, Western Gateway Park, was also a mystery to me, despite having lived in this so called "East Village" many years ago, so I had to Google that one, too. They're basically talking about putting a two mile long north east to southwest tram right through the heart of downtown, intersecting with the skywalk system. This will tie to together the capitol complex on the east side, the hotels and downtown skywalk area in the middle, and apparently they're cleaning up the city headed west out of downtown. The bedroom communities are to the west but it would be a long, slow slog west down Grand Avenue to get there. That is a decent enough area once you get west of about 35th street - older homes mixed with 1920s - 1940s apartment buildings. They'd have a long, long way to go to get to the suburban bedroom communities of West Des Moines, Clive, and Urbandale ...