 | General Dispersive Discovery and The Laplace Transform | The Oil Drum | The Impact of the Credit Crunch on Energy Markets |  |
DrumBeat: October 4, 2008
Posted by Leanan on October 4, 2008 - 10:25am
Can these countries survive exit of cash?
LONDON — As western investors dump emerging assets, the fate of the sector's major economies will hang on whether Brazil, Russia, China and others such as Gulf Oil producers have built up enough funds to survive the storm.Just months ago, many analysts argued the fast-growing sector had “decoupled” from the developed world. But a Wall Street-led rout has since hit stock markets from Lusaka to Bombay as western banks failed or needed bailing out.
Saved - America finally rescues banks and now petrol could fall to 74p a litre
THE world’s economy was saved from total disintegration last night when the United States Congress finally agreed the biggest banking bail-out of all time.The £397billion package means that struggling US banks will be shored up, with massive knock-on effects for the financial markets and, ultimately, hard-pressed families in Britain.
In separate good news, supermarkets embarked on another petrol price war led by Asda and Morrisons, who will today cut pump prices by up to 2p a litre. At the same time, analysts forecast that the price of a barrel of oil could fall to as low as $30 by next year, which would see petrol plummet to around 74p a litre.
Georgia’s gas shortage exposed fragile system
On Aug. 28, Gov. Sonny Perdue officially designated September as “Preparedness Month.” The state, Perdue said, had developed an “ambitious and proactive” campaign with a name that bespoke vigilance: Ready Georgia.Two weeks later, however, Georgians learned just how unprepared the state was for a rapidly emerging crisis in auto-centric metro Atlanta: a gasoline shortage.
Reducing Work Commutes Not Easy In Some Cities, Study Suggests
horter work commutes are one way to reduce gasoline consumption, but a new study finds that not all cities are equal in how easy it would be to achieve that goal.Research suggests that Atlanta and Minneapolis may be the U.S. metropolitan areas that would find it most difficult to reduce the miles that workers commute each day.
Meanwhile, Las Vegas and Miami may be the metro areas where it would be easiest to reduce commuting miles.
Iran to extend the oil credit facility to Sri Lanka
Colombo: Sri Lanka will receive the Iranian oil credit facility for another three months at a concessionary interest rate to meet its crude oil requirements, the government said today.The Iranian government has agreed to give an extension of three months as the interest-free oil credit facility to purchase the country's crude oil requirement is to end soon.
Iran: Gas conference proof US pressure ineffective
A high-profile natural gas conference sponsored in part by two of Europe's largest energy companies opened Saturday in Tehran - evidence, Iran said, that US Pressure was ineffective in preventing the country from developing its vast oil and gas resources.
The Killing Horizon: Capitalism
At The Expense Of All Life
Humanity faces a real crisis - one that threatens not only Wall Street, but all life on Earth. Call it Global Warming, call it Peak Oil, call it running out of water on a global scale, call it the collapse of industrial agriculture. call it fisheries collapsing, call it mass extinction. Call it the potential of planetary death. Call it what is inside the Black Hole made visible, palpable in its meaning. Call it the real event horizon. Call it the Killing horizon. It’s every bit as complex in all of its intersections as the financial “crisis,” but, unlike the financial “crisis,” it’s real.And what happens?
Nothing. No significant action. At all.
There's no $700 billion plan to save the Earth - which sustains us all.
Crude: How Wall Street investment banks manipulated oil prices to try to save their hides, screwing American consumers and the rest of the world and breaking the economy anyway
James Howard Kunstler, author of The Long Emergency and creator of the popular blog Cluster**** Nation, believes that the effect from the speculative market is “basically witch-hunt stuff.” A peak oil theorist, Kunstler, on the phone from his home in Saratoga Springs, says he believes that the root of the problem lies in our global dependence upon a commodity that is quite simply disappearing.American scientist M. King Hubbert predicted in the 1950s that American oil production would peak by the early 1970s. His predictive model was the basis for peak oil theory, which, when applied to the global market, indicates that the world may hit peak oil production within the next 20 years or sooner. Kunstler says that “the biggest thing that’s going on right now is the oil export problem or crisis.
“What that means,” he adds, “is the countries that we depend on for imported oil are less and less able to send it out and they’re using more of their own oil even as they’re in depletion. Two of the biggest cases of this are Mexico and Venezuela.”
Alaska: costs prompt exodus to cities
With growing evidence of an Alaska Native exodus from villages to the city, Mayor Mark Begich and Schools Superintendent Carol Comeau sent a letter to Gov. Sarah Palin on Monday asking her to organize an emergency task force to find ways to stem the migration.Anchorage and the state "cannot stand by and tolerate the deterioration of rural Alaska," the letter said.
SACRAMENTO, CALIFORNIA – The backdrop of a financial crash on Wall Street cast a shadow over this year’s Association for the Study of Peak Oil – USA conference in Sacramento in late September. Speakers talked of an ominous parallel between the financial crisis and another graver crisis in the making – the coming rapid decline of worldwide oil production, which has stalled after reaching an all-time high more than three years ago.
Decatur schools urging gas conservation
Here’s the latest twist to the gas crunch: Decatur city school officials are asking teachers to telecommute for an in-service day this month and they’re floating the idea of asking neighborhood gas stations to send school employees to the front of the pump during dry spells.
NEPAL: Food insecurity intensifies in the wake of floods
KATHMANDU (IRIN) - Nepal's precarious food security situation is being tested after heavy flooding over the past two months in both the east and west of the country left almost 250,000 people displaced....The floods hit when the country was already reeling from drought-led crop failures, spiralling food and fuel prices, political strikes and road blockades, according to government officials dealing with disaster relief.
Egypt struggles to meet demand growth for natural gas
LOS ANGELES -- Egypt has awarded a drilling contract to the recently formed Egyptian Offshore Drilling Co. (EODC), a joint venture of Toyota Tsusho 50%, Egyptian Natural Gas Holding Co. 35%, and Ganoub El-Wadi Petroleum Holding Co. 15%.The award comes as Egypt is stepping up efforts to increase its output of natural gas to meet growing domestic demand, as well as hoped-for exports to neighboring Arab countries and the European Union.
Nigerian gunmen kidnap 6 Filipinos in delta attack
Gunmen in Nigeria kidnapped six Filipino workers during an attack on an oil service vessel in the Niger Delta, security sources said today.
US drilling continues to wind down
HOUSTON -- US drilling activity continued to decline, down by 16 rotary rigs to 1,979 working this week, vs. 1,755 during the same period a year ago, said Baker Hughes Inc.All of the decline was on land, down 25 units with 1,887 still working. That was partially offset by an increase of 6 rigs to 20 drilling inland waters. Offshore drilling showed a net increase of 3 to 72 rotary rigs in federal waters, including a rise of 4 to 69 in the Gulf of Mexico.
Suspected U.S. strike kills 20 in Pakistan: Foreign Taliban fighters believed among casualties
DERA ISMAIL KHAN, Pakistan - Militants on Saturday buried the bodies of Arab comrades who were among at least 20 people killed when suspected U.S. missiles hit a house near the Afghan border, Pakistani officials said.The United States has launched a flurry of strikes in recent weeks against suspected al-Qaida and Taliban targets in northwestern Pakistan, straining ties between the two anti-terror allies.
Cincinnati wants more vegetation on Ohio rooftops
CINCINNATI, Ohio (AP) -- Officials want to see more green roofs on building tops in Cincinnati.The City Council on Wednesday became the first in Ohio with a plan to channel grants and loans to residents and businesses to replace tar and shingles with vegetation.
A last refuge for life remained after extinction
During the worst apocalypse the planet has ever known, somehow, life found a way to survive. But how? Scientists now think they have an answer: a nurturing refuge in the shallow continental shelf waters of northwestern Pangea.During the end of the Permian era 250 million years ago, global warming ran rampant on Earth, extinguishing 95 percent of life in the ocean, and 70 percent of life on land.
Through the darkest days, the planet was a barren wasteland. Ocean circulation, so vital to our modern climate, had shut off. Huge algal blooms sucked the seas dry of oxygen. Poisonous hydrogen sulfide built up to lethal concentrations in the water and may have even been belched into the atmosphere, suffocating organisms on shore.
Ethiopia ends fuel subsidy, increases pump prices
ADDIS ABABA (Reuters) - Ethiopia removed an annual $800 million fuel subsidy on Saturday and said the money would be used to stabilise rising food prices."The $800 million which the government was spending on fuel subsidies will be channelled to ease the spiralling cost of food grain during the current harvest season," the Ministry of Trade and Industry said in a statement.
China`s road to energy security
BEIJING (Xinhua) -- At the station, the oil nozzles were left idle -- the supply of diesel had run out and the new delivery wouldn't come until after midnight."We have no oil here. Don't wait any more. Please go to another place," clerks at the Sinopec station shouted to the drivers, someof whom responded that their vehicles were out of fuel and couldn't go any further.
When the delivery came, it would not be enough, a driver said. The limited stock would be sold on ration. Most vehicles would be partly filled and some would have waited in vain. The same situation was also seen at other stations, and it had been like that for days, the driver added.
Pakistan: Home appliances major cause of power crisis
ISLAMABAD: The addition and use of some 30 million energy-intensive electric home appliances in the country was the major reason for the 3,570MW power shortfall that resulted in the recent power crisis in the country and not only the higher economic growth, reveals an official report of the Pakistan Electric Power Company (PEPCO).
PETALING JAYA: Oil companies have been instructed to ensure that petrol stations outside the Klang Valley have adequate supply for those returning to the cities from their kampungs after the Hari Raya break.Domestic Trade and Consumer Affairs Minister Datuk Shahrir Abdul Samad said he sent out instructions yesterday, adding that he would not accept any excuse on this matter.
Bus fares to be increased, public to get concession
The Macau government is planning to spend 250 million patacas a year in order to achieve a win-win situation of increasing bus fares whilst offering up to 50 percent concession to the majority of the population.
Georgia Officials Debate Response to Gas Crisis
ATLANTA (AP) -- Georgia leaders are debating whether to revise the state's emergency fuel plan and are considering ways to bolster gas supply in the aftermath of the abrupt shortage of gas that sent some motorists into a frenzy.
Gouging laws deepen shortage, expert says
ATLANTA --- Laws prohibiting gas retailers from exorbitantly raising prices after hurricanes disrupt supplies are supposed to help hold fuel costs in check.But as fuel supplies neared empty recently, a theory emerged suggesting the laws might keep drivers from finding gas.
"You do exacerbate the shortage. You don't solve things, you make it worse," said David Mustard, an associate professor of economics at the University of Georgia.
Budget forces Des Moines to weigh cuts in service
The projected shortage is in the general fund that pays for departments such as fire, police, parks, community development and the city manager's office and accounts for about 22 percent of the roughly $610 million overall budget.Fuel costs are the wild card. Clark said the cost to keep city vehicles such as police cruisers and snowplows on the road could outpace what is currently budgeted by $1 million or more.
General Motors to Keep Compact-Car Factory Running Overtime
DETROIT -- General Motors Corp., still unable to meet demand for fuel-efficient small cars, will keep its sole U.S. compact-car factory running on overtime for the remainder of 2008, the auto maker said Friday.
GM closing Ohio SUV assembly plant
MORAINE, Ohio (AP) -- General Motors Corp. said Friday it will shut down its SUV assembly plant in Moraine, Ohio, on Dec. 23 as the company shifts focus to smaller vehicles.
Oil firms troubled over fading Mexican oil reforms
International energy companies' hopes of tapping Mexico's oil reserves are dimming as President Felipe Calderon's oil reform proposal faces dilution by opposition parties in Congress.Energy companies had hoped to gain a toehold in Mexico's unexplored but potentially prolific deepwater territory in the Gulf of Mexico by partnering with state oil company Pemex, but congressional hearings on the reform package point to a more modest overhaul of energy legislation.
India: Reliance refinery set for test run
“We could reach full capacity within days of starting production. We will do it in phases. If everything goes well, we hope to repeat the first refinery’s commissioning which was done in days because we did not have any problem,” the official said. The first refinery was commissioned in 1999.
Naphtha beats LNG as cheaper fertiliser fuel
NEW DELHI: For the first time, fertiliser companies have begun paying a higher price for spot LNG (liquefied natural gas) than for naphtha. September prices for spot LNG in India have registered a hike of almost $3 per mmBtu (million metric British thermal unit) compared to naphtha price.
Senators McCain & Obama: We Need Clean Energy, Not "Clean Coal"
Last night in the Vice Presidential debate, you heard both Senator Biden and Governor Palin touting their support for "clean coal". Today, President Bush signed a $700 "bailout" bill passed by Congress that provides important tax credit extensions for renewable energy and energy efficiency measures--but also gives $25 billion in tax credits to the coal industry.Both presidential campaigns and our Congress are missing the point: Conventional coal-burning power plants are the leading cause of global warming pollution in the United States.
Revised July oil demand lowest in 11 years: EIA
WASHINGTON (Reuters) - U.S. oil demand in July fell to the lowest level for the month in 11 years, with consumption 736,000 barrels per day less than previously estimated and down 1.335 million bpd from a year earlier, according to the U.S. Energy Information Administration.Crude oil and gasoline prices hit record highs in July, and U.S. motorists reduced driving for the ninth month in a row.
Based on final numbers released this week, U.S. oil demand in July was revised down 3.7 percent from the EIA's early estimate of 20.148 million bpd to the agency's final demand figure of 19.412 million bpd, down 6.4 percent from 20.747 million bpd a year earlier.
Colonial Shuts Its Only Fuel Pipeline to Northeast After Damage
(Bloomberg) -- Colonial Pipeline Co., the world's largest operator of petroleum-product pipelines, said a pipeline that carries fuel into the U.S. Northeast is shut after a contractor damaged the line earlier today.
While we tend to agree with Dr. Patrick Moore, founder of Greenpeace, and many others, that nuclear power development is a choice worth considering, what follows is a thoughtful financial analysis of the nuclear option that comes to a very different conclusion.
An energy solution that's worth another look
THERE may be a workable way to solve most of America's energy problems, end dependence on foreign oil and dramatically cut greenhouse gas emissions with little pain.Remarkably, while proposals for renewed offshore oil drilling, new atomic power plants, expanded carbon trading and other proposed tactics abound in this year's presidential campaign, no one mentions the single-most promising technique.
This may be because its name contains the word "reactor." Combined with the fact that it depends on a sophisticated form of nuclear technology, that appears to make the notion of power plants using the Integral Fast Reactor anathema to today's politicians.
Rice in India, may not sign nuclear deal
NEW DELHI (Reuters) - U.S. Secretary of State Condoleezza Rice arrived in India on Saturday after Congress ratified a historic nuclear pact, but was unlikely to sign the deal during her visit because of a bureaucratic "glitch."U.S. State Department spokesman Sean McCormack said an enabling legislation had not yet been formally "enrolled" in the U.S. Congress - a required step before the pact is sent to President George W. Bush for signing into law.
Peru studies climate riddle as the world heats up
LIMA (Reuters) - Scientists are using everything from a yellow submarine to weather balloons and special airplanes to solve a climate conundrum: why is Peru getting colder while the rest of the world heats up?
US presidential race: Is there a green candidate?
The high cost of energy in the US has been used to argue for more domestic drilling and the lifting of bans on offshore oil exploration, often couched in terms of easing dependence on imported oil for the benefit of national security.Soaring energy costs, however, also provide an effective argument for pursuing alternative energy sources – but although there has been some progress, the case for renewables has not yet been supported by policy.
It is likely we will see increased efforts on energy efficiency and conservation. And while clear and consistent policy on climate change would be preferable to the vagaries of the market (automobile fuel efficiency also climbed quickly following the 1973 energy crisis, then did not move much for 30 years), cutting energy waste will benefit the planet as well making US companies more competitive.
Filling Up the Backyard With a Gas Station
He said he could sell the Mae West pump for three times what he spent and a faded metal sign for Mobil oil for about five times the $300 he paid for it at a swap meet three years ago. But that, he said, is not why he collects petroliana.“You know why people like stepping back in time?” he said. “Those times were fun. People love history, and they love to step back into it.”
Behind the Bluster, Russia Is Collapsing
To be sure, the skylines of Russia's cities are chock-a-block with cranes. Industrial lofts are now the rage in Moscow, Russian tourists crowd far-flung locales from Thailand to the Caribbean, and Russian moguls are snapping up real estate and art in London almost as quickly as their oil-rich counterparts from the Persian Gulf. But behind the shiny surface, Russian society may actually be weaker than it was even during Soviet times. The Kremlin's recent military adventures and tough talk are the bluster of the frail, not the swagger of the strong.While Russia has capitalized impressively on its oil industry, the volatility of the world oil market means that Putin cannot count on a long-term pipeline of cash flowing from high oil prices. A predicted drop of about one-third in the price of a barrel of oil will surely constrain Putin's ability to carry out his ambitious agendas, both foreign and domestic.
"Congress should realize we have two diseases crippling America today," warned Matthew R. Simmons, Chairman of Simmons & Company International. "While the financial crisis is like asthma or tuberculosis to the economy, a gasoline supply crisis could be terminal cancer," Simmons argues. "The government can print more money but gasoline is a hard asset. If we drain the pipelines, we won't be able to drive; if we don't ban driving we could run out of food within 5-6 days and face the greatest crisis in the history of the United States," Simmons said on WorldEnergy.TV, where he focused on the current financial crisis, the price of oil, the gasoline shortages, and the upcoming presidential election.
Iran says oil under 100 dollars is 'unsuitable'
TEHRAN (AFP) - Iranian Oil Minister Gholam Hossiein Nozari said on Saturday that a price of under 100 dollars for a barrel of crude oil is "unsuitable.""An oil price of less than 100 dollars is unsuitable for anyone, either for producers or for consumers," Nozari told reporters on the sidelines of a gas export conference.
The minister did not elaborate.
"Unfortunately despite decrease in oil prices we have not seen any signs of a decrease in the costs" of oil production, he added.
US threatens to steal Iraq oil money
Washington has threatened to seize Iraqi assets and oil money if Baghdad rejects a controversial US-proposed security pact, Iraq says.
Gunmen release Briton in Nigerian oil city
PORT HARCOURT, Nigeria (Reuters) - Gunmen in Nigeria on Saturday released a Briton kidnapped more than two weeks ago in the oil hub Port Harcourt, a military spokesman said.
Why an oil producer turned into an importer
Indonesia's petroleum production has plummeted by almost half in the past decade, and its ageing oil fields are not all that is to blame.The tangle of red tape faced by oil companies, coupled with rising local demand, have helped turn the country from oil producer to net oil importer.
ESPO oil pipeline section opened in Russia's Far East
TALAKAN (Yakutia), October 4 (RIA Novosti) - A 1,100 km leg of the East Siberia-Pacific Ocean (ESPO) oil pipeline was opened Saturday in Russia's Far Eastern republic of Yakutia.
Offshore Exploration & Production Policy
Peak oil situation will definitely impact Bangladesh like any other country. Its developing economy will require substantial oil, gas & coal to keep the engine of economy running. It must create required incentives for oil majors and reputed mining companies with proper licensing and fiscal policies. At the same time it has to gradually but carefully adjust its domestic price of energy so that the expensive future energy does not create imbalance in the energy market. It is highly unlikely that Bangladesh will soon achieve its own capacity to make significant investment in exploration.
Myanmar Plans Offshore Oil Exploration With Vietnam
YANGON (AFP)--Myanmar's state oil company is to explore offshore oil and gas in a joint venture with two Vietnam companies, state media reported Saturday.It allows the companies to explore supplies in the Gulf of Martaban, south of Myanmar in the Andaman Sea.
Asia, where demand has been a big factor in soaring oil prices, will continue to be the centre for oil and gas consumption going forward, although demand for energy may not exceed 4% per year over the next 20 years, says a senior industry executive.''Our current projection is that the total oil and gas demand is unlikely to exceed 4% over the next 20 years, although prices would depend upon the cost of exploration and production,'' said Jeroen van der Veer, the chief executive of the world's second largest oil and gas exploration company, Royal Dutch Shell.
Study: Make diesel, jet fuel at ND refinery
BISMARCK – Developers of a proposed oil refinery near Williston say it should produce mostly diesel and jet fuel instead of gasoline, and that it needs new pipelines to export refined petroleum products.Air Force bases in North Dakota, South Dakota and Montana are potential customers for jet fuel, and the refinery should assure North Dakota farmers, truckers and oil producers of a ready supply of the diesel fuel they need, said Mel Falcon, chief executive officer of Northwest Refining Inc. of Williston.
First Nations, Enbridge reach deal over pipeline
On Friday afternoon, chiefs from Treaty 4 and Treaty 6 First Nations and representatives from Enbridge Pipelines Inc. participated in a pipe ceremony near Regina to formalize what the chiefs are describing as "a new alliance." The two groups as well as representatives from the provincial and federal governments met Thursday to settle a dispute over the construction of the pipeline through traditional territory.
Tata Motors Scraps Factory for World's Cheapest Car on Protests
(Bloomberg) -- Tata Motors Ltd., India's biggest truckmaker, abandoned its newly built factory for the world's cheapest car because of violent protests by farmers, hampering plans to start selling the $2,500 vehicle this year.
California's Number One Inland Oil Polluter in Trouble Again
SAN FRANCISCO, California, October 3, 2008 (ENS) - An oil company that state and federal officials have called California's number one inland oil polluter has failed to meet multiple deadlines to clean up leaks from settling ponds on one of its leases, so the U.S. Environmental Protection Agency this week took over partial cleanup operations to ensure they are completed before the rainy season.
ConocoPhillips official sees boon for gas in next year's CO2 debate
No matter who wins the presidential election, the natural gas industry already is a winner because both candidates and Congress are intent on getting legislation passed limiting U.S. carbon dioxide emissions.James Duncan, director of market analysis for ConocoPhillips Gas & Power Marketing, made that observation Oct. 2 during a meeting of the National Energy Services Association in San Antonio.
WWF bemoans attempts to water down EU's green targets
BRUSSELS (AFP) - Europe's plan of action to tackle climate change is being undermined by pressure from industry and may no longer achieve its original green goals, the environmental group WWF said Friday.
Richard Leakey: It’s the end of the world as we know it
Can we sustain 7 billion people on the planet? Almost certainly not. Could there be an epidemic that could wipe out half the world’s population? Certainly yes. When will it happen? Probably soon.
Contact
- Content: editors at theoildrum dot com
- Tech support: support at theoildrum dot com
License
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 United States License.
Linked at Mish's website:
http://www.minyanville.com/articles/index.php?a=19326&refer=socialpicks.com
Five Things You Need to Know: Bailout Passes, Stocks Limp
"No one in politics can accept the reality. . . "
Of course, this is even more accurate when it comes to the reality of finite fossil fuel energy supplies.
Mish is absolutely correct.
This has been quoted here before by myself and others, but since it is so germane to the discussion at hand, I think it deserves repeating:
I still do not understand why the reduction is housing prices is necessarily a bad thing. The primary problem has been that people were able to buy homes that they could not afford, putting aside who is at fault for this. If the easy money had not been created in the first place, it is not likely that we would be in the mess that we are in. Those who could not afford homes would continue to rent as usual, homes would be cheaper, and/or people would live in more modest circumstances. Instead of letting the market do its thing by letting house prices fall to a new equilibrium, the approach seems to be to prop up house prices and/or allow people to have part of their debt forgiven so that they can afford homes they should not have bought in the first place.
If people lose their homes and then have to rent or purchase more modest homes,they will not be any worse off than they were in the first place. In fact, they would be better off because they would actually have some money left over at the end of the month to pay for other things besides their mortgage.
Part of the problem, of course, as Krugman pointed out years ago, is that the U.S.A. has a hollowed out economy that has become overly dependent upon the housing sector as its engine of growth. Since it cannot contemplate or establish an alternative to that sector, the presumption is that the sector needs to be propped up at all costs. Well, we have reached the point of "all costs" and no one knows when this spiral will end. We are well into the great panic of 2008. Does anyone think that we will extricate ourselves from this downward spiral anytime soon?
I certainly would not pretend to have a comprehensive solution to this problem but the proper direction, it seems to be, would be more reliance on direct investment in something that would have a long term value like the alternative energy sector. This way we address two problems simultaneously. At least, in this instance, we get something real and concrete for our investment. As it is, we will probably just be sinking $700 billion down the proverbial rat hole. I hope the rats are appreciative. Just buying up worthless toxic debt seems like a rather indirect and unsatisfactory approach to addressing our national and planetary problems.
As an aside, this country has long operated under the assumption that we should direct investment into housing by subsidizing homeowners through tax deductions. This in is part of the great misallocation of resources that Kunstler talks about. This bailout will just help perpetuate that misallocation.
We have become a nation whose economic system rewards sociopaths and clerks, with most people just pushing data around, or organizing it.
We need to become hunters and gathers again, not betting life on a pyramid scheme that all know, bit refuse to accept, will come tumbling down.
Yes and worse, what should it reward? We are paid according to the quality of or energy not the quantity , surgeon/laborer. If we had a calorie meter. . lets see i burned 5000 calories fixin your door Mrs. Johnson at .50 cents a calorie thats 3000 plus materials.
There is no justice we're all victims of circumstance for better or worse.
"become hunters and gathers again"
I dont think the transition will be a choice or smooth. It has been a long time since we lived that way and how many hunter gatherers can the planet support?we will be scavengers first,and the ones "rewarded" with survival may be those willing to eat there own kind.
ex-addict - Good question...let's look. Prior to the invasion of the Spanish in the early 1700's the Kumeyaay Indian Tribes existed sustainably as Hunter Gatherers in the Desert Sage Biome from Baja to the Laguna Mountains and extending east as far as Escondido for over 10,000 years. Recent excavations place these developments as far back as 20,000 years.
What were their populations? Estimates vary from a few thousand to as many as 19,000. What is the population of these same areas today? A: Ten Million or more. And don't forget that due to development all of those ecosystems would be unable to support even a few hundred. The only intact eco-systems in California are contained in 130,000 acres contained in the UC reserves (35 secluded intact reserves maintained by the University of California Natural Reserve System).
Kunstler coined the term "Wile E. Coyote Nation". What that means is there's no getting back to where we were before without a great crash.
Conclusion: We're going to either make this civilization thing work or we will go extinct as a species.
Joe
If your parameters are economic collapse leading to social collapse, then I strenuously disagree. If you are including climate change of the +6 degrees C variety, then I agree. A new Ice Age less a snowball Earth scenario also would not lead to the demise of the species. What are your assumptions?
The 6C+, Snowball Earth and global nuclear war are the three scenarios I could see leading to the demise of the species. Other than that, we are too adaptable, too creative and too able to terraform the planet to go extinct otherwise.
In a complete collapse scenario you would still have groups, both large and small, banding together to survive. If the planet can support farming, people will farm. What will NOT be possible until after a massive die-off and some years of regrowth of the ecosystems will be large bands of hunter gatherers. It would be hard in most, but not all, areas for more than small populations to be hunter gatherers for at least some years.
However, fish populations indicate the rebound of animal populations can happen quite suddenly once you leave them alone. But the oceans are relatively intact ecosystems compared to land ecosystems. I suspect they would rebound faster for that reason and because of the sheer numbers of offspring many aquatic lifeforms have. On land, the population growth should be slower for the opposite reasons: the ecosystems are wrecked over a large area of the earth and most lifeforms - animalia, anyways - breed fairly slowly by comparison.
Of course, much depends on the speed (and type, but let's ignore that for a moment) of die-off. A sudden collapse of the human population would remove constraints on flora and fauna quickly and likely result in a relatively fast rebound of life. However, the ecosystems would need time to balance, so any stocks would not be reliable for some time. Still, say one to five years for a stable food supply excepting climate impacts. If die-off is slow, then one would expect the environment to be even more severely degraded by people taking desperate measures to simply survive. Billions of out of control people would spell a massive die-off of flora and fauna, too. With the additional environmental degradation, destruction of ecosystems and depletion of flora and fauna to minimal levels - and the extinction of many - it would take longer for ecosystems to balance and would help drive the human population to very low levels.
Or maybe not. I'm writing this with only my own thoughts to back it up, so...
Cheers
Realistically, only the snowball earth scenario leads the the extinction of humans. The dieoff from +6C might be high, say 50% to 90%, but some groups would survive and eventually repopulate the earth. Similarly the global nuke war, would leave some areas survivable, especially isolated areas in the southern hemisphere (which would get much less radiation & short term global-winter type climate effects). Even in a high radiation scenario, humans would still be able to live and reproduce, even if cancer reduced the lifespan significantly. Chernoble, is a great boon to wildlife. Perhaps the life expectancy of a few of the animals is a bit shorter than it otherwise would be, but without lawyers suing other animals that has little impact on the survival of the species. Global nuclear war, is much less severe than even a small (say 2KM diam) asteroid impact.
ccpo, nice thoughts and no problem that they are just yours, others think like quite like that.
I'm working my hypothermia solution. I'm remote, and I fully expect an exodus to the cities. I think the general thought that people will head to the cities in hard times is accurate. Hypothermia draws resources from the extremities to keep the central core running as long as possible. Frostbite, fingers and toes go first. Got a few burns myself from the maine mountains.
My thought is that this is not a bad thing, I'm a toe planning to survive. Figure I've got a foot warmer hidden. While all the attention is targeted on the core, it actually frees up resources for those who are really remote. When these people head to the city , they aren't cutting wood, or shooting the wild turkeys.
Heck the wild turkeys take bird seed from my hand.
Government, military, will all be focused on the greater piles of people, the need to control runs strong. I'm very happy to see people leave. It frees up even more resources for me. It means the existing government, whatever that turns out to be, is very busy just getting food to them all. I'm small and insignificant, and they will never see me. They will be concentrated on the core and not the toes.
First fire tonite, cleaned the chimney today, stove black and new gasket. Don't really need it, it's just comforting to see the system work. About 38 degrees here now.
As I get older, I do get slower, next years wood is cut but it isn't all split yet. How many of you have 2 years of energy stored , for heating your house?
Do you even have any system in place that warms you without spending $$ and getting a delivery? And I also mean rely on the grid, paying your electric bill. How long can you rely on the job to give you $$ and how long can you rely on the grid? Your heat pump does not work without electricity. If you don't pay the bill you are SOL. Lots of BAU here and thinking that is cutting edge.
Peace to you all
Don in Maine
Don,due to a windstorm that dropped a couple 3 big fir trees next to my house.I have around 3-4 years split and stacked.And covered..
Lots of 5 and 6 gallon pails in the barn.
I am the senior Inspector type in my dept.25 below me,however ,[not the highest paid]The former ceo/owner told me once that I would be there when they shut the door,because the management knows who does the work[nice
I am 20 miles outside Portland,at the edge of the bedroom communities..between 2 old logging towns around 5000-10000 pop.I live at the end of a dead-end road,I know the neighbors,mostly old,retired,and self-sufficient.W/150 fruit trees,huge garden,spring,and such,I worry less than most.
I think we will make it until its not a issue to make your house payment.I have a feeling we will have some financial Armageddon in our not to distant future.
This sounds really weird.I have stopped obsessively focusing on this bailout/preps ect. and began to resume construction work on a small sailboat.I have been so absolutely outraged/spun up at the affairs of the last two weeks that I ,in the interest of my mental health,am doing something I enjoy,this allows me to shift my attention,and decompress a bit.
I still have a few things to finish up...some dental work,and new glasses,but I am better equipped than 99% of the people I know,and am simply living my life...
I refuse to let this bull#&$ screw up my head.
Yes, I, too, have had a bit of a shift over the last few days. Funny thing is, I anticipated financial meltdown during this time frame. Doesn't make it any easier. Until it happens, it's possible it won't, right? Until this happened, I had thought there was some small difference between Obama and McCain that made it worth voting for Obama. I was waiting for the election results to determine whether the US was a viable choice or not. That difference is now down to almost nothing, and the chance of us making our home in the US is getting quite small. Fortunately, we have options.
I find myself relatively disinterested in what happens next. I can't find much reason to think it will make much difference. My key event now is martial law. Will it come or not? Given how much in the pocket of the financiers Obama is, I no longer see his being elected as a possible trigger for ML, but see it as likely if either 1. the crisis deepens suddenly and/or 2. the people of the US miraculously begin to become more activist.
Cheers
Don,
Glad you are so well prepared. I, unfortunately, am not. There's land available, but I can't convince family a change is needed. We've a little money, but a very small amount when considering what we need to do. If worse comes to worst, we'll go to my brother's small orchard/farm, but the size isn't really sufficient.
It would be possible to buy a piece of land pretty much anywhere for a few thousand dollars and work the soil into good farmland ourselves over some years while putting in a straw bale or cob-type home, for example, but we'd be isolated from family, if so. No community to speak of. Not ideal, but a last resort.
My concerns for the remote hideaway approach are three: availability of what may become critical goods/services, such as medicine, medical care, tools, etc.; too small a group for self-defense; and the government going all Roman on us and confiscating land for food production. Forced/indentured/peasant food production. After hearing Martial Law being used as a threat to get the King Henry Paulson Bailout, Socialism and Welfare for Bankers and Financiers Act of 2008 passed, I have little doubt it will be invoked in the not distant future.
Best of luck,
Cheers
At least one of TOD staff members has expressed that concern. That those who know how to farm will end up as peasants. We aren't at "peak population control" yet; the US government is likely to have methods far superior to the Romans'.
Not peak control, but peak technology. As we now know, the surge worked for at least two reasons, neither of which was the number of troops. One was the ethnic cleansing and the other was the new technologies they are using in Iraq. Wasn't the story about a melted bus in Baghdad posted here at TOD? We also know legislation for new-fangled Manzanar's is in play, that troops are now being prepared for use on US soil vs. US citizens.
Not a bad time to be an expat.
Cheers
I was thinking of more subtle technology. Like drugs and other mind control techniques.
Heck, look at how advertisers get us to enslave ourselves by spending money we don't have for things we don't need. All while using relatively benign methods. Methods may be less benign in the future.
If you would like to see how a post-apocalyptic world will look like you won't have long to wait. Cormac McCarthy's movie version of his post-apocalyptic thriller The Road will be released into theaters on November 28. Apparently apocalypse has hit the big time as it features A-list stars: Viggio Mortenson, Charlize Theron and Robert Duvall.
http://www.nytimes.com/2008/05/27/movies/27road.html
What is Cormac McCarthys' rationale for the collapse? He never explains that in the Novel: Global Warming, Peak Oil, Nuclear Fallout...take your pick.
The end of the world... Sounds like fun!
Joe
Gee...I read The Road some time ago. I can't recall a bimbo in the novel.
Though I must say Theron is nice to look at but?
This movie if true to the book will be a 'killer'. Scare the shit out of the audience.
The part about the gangs storing the others in cellars to feast off them at leisure was rather disturbing. But the real plotline was about the fathers very real attachment and concern for his son.
Overall it was overpowering and extremely dramatic. Not for the faint of heart.
Airdale
Charlize Theron only has a few scenes in flashback. In the novel the wife (Theron) had committed suicide before the events in the book take place.
The Road is wonderful and heart-wrenching. A heavy read. It knocks the mercury out through the top of the doomometer--fitting for the mood of our times. I hope and fear that the movie will stay true to the book.
Ultimately, that's true. But the transition is the hard part as millions of people go through the process of walking away from their homes and in many cases losing the only equity they've built up in their lives.
It's just like the steady-state economy. Anyone who seriously looks into our economic system soon sees that we need to reach a steady-state after we've shrunk it significantly (and our population). The problem is nobody knows how to get there from here without going through collapse first.
Yes. It's especially rough on retirees, or those close to it. Many of them were planning to fund their retirements off their homes. The house is often the only significant savings or investment they have.
Isn't the point of the "bailout" to keep home prices propped up long enough to let the biggest banks get out from under their own frothy investments by making the American Government either counterparty or outright owner of the toxic scum, and then, and only then, allow the prices to collapse catastrophically?
Banks are protected, life goes on with everyone still in their houses. Banks now own everything. Goldman Sachs calls the tunes, and Hank Paulson is Regent.
no. There is a provision in the bill that allows your tax payer money to buy bad assets in other countries with you seeing any benifet. The bill is not much of a bail out, but a engineered collapse because we will be taking on debt that no one will want to buy from us later.
If the government borrows too much to bail out those who borrowed too much, what will happen to the government?
Will it be credit tightening, or a wheelbarrow full of money to buy a loaf of bread?
Most of Congress was complaining about the lack of easy credit, the inflation may come later.
If people were willing to pay higher interest rates and had good credit; Warren Buffet might lend them money at 10% per annum plus shares of their company's stock. The public wants unlimited credit lines at low interest rates. It is not the government's job to give away free money out of the voters' treasury. I am not sure the taxpayer will be given good securities in exchange for the many billions Congress voted to pay out to failed financiers for their junk mortgage notes. The government might be representing special interests who cannot afford to sell at a lower price to the public at large.
If you raise depositers' interest rates on CD's, savings accounts, or money market funds, and raise the cost of borrowing money enough, the credit markets should balance between supply and demand.
If there is a liquidity crisis, where will the banks get the funds to offer these high interest rates. In addition, if we are in a recession and given the low to negative savings rates of American consumers, the interest rates required to bring about sufficient liquidity could be astronomical. Anyway, banks and companies need the ability to borrow to function in an efficient and productive manner. Right now, our credit markets are somewhere between frozen and virtually frozen. That is the whole conundrum. The U.S. government has chosen to address this issue by buying up toxic debt. However, I have trouble wrapping my mind around the concept that you solve a debt problem by creating more debt. Let's say we buy up all this toxic debt. What is to prevent this from happening again, especially if so much of our society's resources is devoted to paying off accumulating debt?
The bottom line is that we are in debt (death) spiral and no one really knows how to stop the descent.
If the bank will need funds they should offer better than 3% money market rates. If you give me 10% on my money, I will consider selling some stocks and putting money in your bank. As it is they offer rates that do not seem to compete with inflation rates and wonder why people do not want to save their money.
Probably. It's Enron Economics on a National scale. Andy Fastow is in jail for doing what everybody else in Investment Banking has been doing for the past 20 years: Moving bad investments to toxic portfolios and leaving the profitable ones on the books with the goal of inflating the stock values of these preferred investments. That's why we all invested in IRA's to prop up this game. Racketeers used to call it: keeping two sets of books. Now we, the lowly taxpayers, get to buy these overinflated (they won't even tell us what they might actually be worth) losers with the hope that somewhere down the road the economy will get better and this perrenial gravy train will roll into a bright yet green future.
In the long run the only way that home prices might stabilize is for wages and employment to rise-substantially. Chance of that happening: Zero
I have several wild-ass guesses where this might end up at but the one common denominator is most of us (self included) end up as serfs.
Joe
Don't you just love it--Treasury to Hire Asset Management Firms to Jumpstart Rescue.
Another "surge" of no-bid contracts.
``Paulson did not want to lose precious days waiting,'' said Howard Glaser, a former chief legal adviser of the Department of Housing and Urban Development.
Belatedly I realise there are a number of problems with that savings strategy ... one is that everybody has to have somewhere to live, so only a portion of any net wealth can ever be extracted ...
another is demographics, there aren't enough of the required younger people to buy the boomers houses ...
and another is that it is a very small proportion of the older people who have most of the non-property wealth that the boomers require to consume, so the younger people can't afford the price required to extract the wealth originally stored, the only way they will get to own it is by leaving it to them in a will as a gift.
In my experience houses consume wealth on a more or less continous basis, they certainly don't create wealth.
Apart from all that it is a good plan, I wish I had thought it through a bit more carefully 30 years or so ago! :-(
Equity from the house as a retirement plan was fundamentally a kind of pyramid scheme. The idea was that one would buy a big house to raise a family, and then downsize for retirement, cashing out the delta between the big family house and the retirement house. However, that only works so long as there are at least as many people in subsequent generations to buy your big house as there are big houses to sell.
The other big source of retirement income was supposed to be the 401K. Of course, boomers (to the extent they had any money in their 401Ks) are watching that money shrink. A friend of my wife's was complaining that the fund she'd said up for her daughter's college expenses was going down faster than she could put money into it, and that was before the last downdraft in the markets. Peak-to-trough, we will see at least a 60% decline in the markets. It could be more. The decline in the Great Depression was nearly 90%.
I look at my parents, who retired with pensions, good health insurance, and reliable social security, and wonder how I'm going to get by when I'm their age with none of that. I think the US is facing a humanitarian disaster as the boomers get old and feeble. Many people assume they'll be able to get jobs at McDonalds, but I don't think so. How many old farts is McDonalds going to need? The generations after mine are all up to their eyeballs in debt. I don't see how they're going to take care of their parents & grandparents.
Would-be retirees you mean.
Unfortunately many will be forced into retirement involuntarily, either by layoff, or because of ill health. The more fortunate (boomers like myself), may be able to work longer than intended, and perhaps will skate through with enough.
There's going to be a lot of competition for Greeter jobs at Wal-Mart.
Not just from their homes. Im a boomer, and have more in investments, than my home (now 99+% piad off), but both stores of apparent wealth have been suffering severe declines of late. Likewise for those for those with defined benefit retirement programs. A market decline like we've seen recently will put many of these plans so far underwater that they won't be able to meet their obligations. For those plans that can survive, benefit accrual rates have been cut so far, that essentially all of the current contributions go toward shoring up promises already made, and the younger workers are simply throwing their contributions into a black hole.
As an example of the hit to retires. I had a portion of my portfolio in individual bonds, a rather common thing for retirees, who do this to make their protfolio less volatile (i.e. this was standard practice to make investments low risk during retirement). Well the bonds I have are now worth on average 68 cents on the dollar. They have done even worse than the stock portion of the portfolio.
aangel - I think a lot of people (more every day) are coming to the conclusion that the present system is un-reformable. For that group what is up for debate is whether a fast collapse would be preferable to a slow grinding one and what should we doing in the meantime to prepare for that eventuality?
Joe
I guess the answer is this:
4% of the U.S. grows food, 96% percent sells (or makes) stuff. Maybe 10% of the stuff is important. The other 90% is not and this 90% is intimately tied to consuming vast amounts of energy and vast amounts of financial credit.
So... as we tumble into severe recession, what will the folks who sell Barbies, cholesterol drugs, iPods, frozen waffles, and database marketing applications do?
It's convenient to peg this to houses, but the problem is much more profound. Without credit, stuff can't exist. Without stuff, overshoot is obvious.
I think the answer to your question "what will the folks who sell Barbies, cholesterol drugs, iPods, frozen waffles, and database marketing applications do? is contained in Mike Davis' work, principally, Planet of Slums. People will adopt a very low-energy form of life, in general. The more ambitious and energetic individuals will cause local havoc. Everything will sink into a morass of excrement -- because there will be no energy (of any sort-- hydrocarbon, financial, moral) available to clean up the mess. Entropy triumphs.
Presumably, the rich will tolerate this then, as they do now, because they think they can go somewhere else.
I second the reading of Davis, one of the clear thinkers of our time.
And teaching at UC Irvine, ground zero for delusion and madness.
Cf. UCLA prof Edward Soja's urban studies book 'Postmetropolis,' he talks about Orange County as the center of the international 'scamscape'...that was a decade ago already ha.
http://www.amazon.com/Postmetropolis-Critical-Studies-Cities-Regions/dp/...
In support of your estimates, the Rand Corporation back in the 1960s did a study for the Feds in which it estimated that the unemployment rate could reach 90% before civilization began to fail.
Now WHY the Feds wanted that study is left to speculation.
You gotta wonder how they would figure that out.
And even if it's correct...is it still true today? That was 50 years ago. There are a lot more single people living alone now, and more single parents and small families living isolated from their extended families.
Hello Leanan,
IMO, it is inevitable for families to start going postPeak tribal; for extended families to come together on one property.
Please plan ahead: If the house is going to be too crowded--> plan ahead by having a small, used trailer or used cabover camper on the property. It is no big deal to run an extension cord to power this shelter, and the self-contained toilet can be emptied as required into the sewer cleanout, but more hopefully added to a compost pit.
These shelters are not inherently super-insulated from the factory, but the money you save buyng used should help you park it underneath a cheap suncover to save on A/C costs, or inside a garage or barn to save on winter heating costs.
If an emergency develops, such as the recent hurricanes in TX/LA: temporarily evacuating, then camping out in these rigs is much cheaper than staying in a hotel. The teens and adults can sleep in tents or the other family vehicles, but those babies, sick, or elderly, sensitive to temperature extremes can stay in the genset-powered, thermostat controlled A/C camper interior. If an RV-campground has the hookups for water, sewage, and electricity--even better.
I get the feeling that many TODers that post are wealthy enough to be well on their way to having Eco-Tech shelters. This is more aimed at those TODers, like Leanan and I, plus many TOD-lurkers that are much further down the wealth scale and have no property.
Recall TODer Fleam, who unfortunately got trapped as a vulnerable and exposed 'rabbit', instead of having the minimal resources of a decent and mobile camping 'turtle shell'.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Maybe eventually, but now, many live far from their families...and they may not be able to afford to move.
Families are also much smaller now than they used to be.
And no way am I buying a camper. Big waste of money from a peak oil perspective.
Hello Leanan,
Thxs for responding. I respect your decision as you know your personal situation far better than me [also none of my business, too].
But, please consider: let's say you are paying $500/month rent to a landlord = $6,000/year. Six grand can buy an excellent used camper or trailer, then if you can park it on a friend's lot close to your work for $100/month: you help your friend keep their property, plus you save $400/month to maybe later buy your own Eco-Tech property with other family members. In the meantime: it's a piece of cake if you wish to 'turtle' outside the city for an emergency or just to go vacationing cheaply. If the power goes out: fire up the genset for A/C, or propane heater so both you and your landlord friend can be comfortable, instead of being in a life-threatening too cold or too hot/humid extreme.
I know that most women are fearful of the skillset of jockeying a trailer, but driving a cabover camper is no big deal if you don't forget the rig's extra height. You earlier said that you don't drive much, which is good, because it is easy to pop-on or pop-off a cabover from a pickup so that you can get the best potential MPG. Then you can use the pickup to haul firewood, manures, insulation, other construction materials, etc, for your and your landlord's mutual benefit. I have made lots of extra, tax-free cash over the years renting my labor and pickup out when the opportunity presented itself.
I have yet to hear of a Chevy Corvette owner earning money hauling fresh manure in his interior seating and storage areas.
Not around here it can't. At least, not yet. I expect that may change.
I live closer to my work than any of my friends. I expect they will be begging me to let them crash at my place. One has already been hinting about it.
You gotta be kidding. It's not 1980 any more.
If things get that bad, I won't be hauling anything, because I won't be buying gas.
Bob;
Speaking out of true concern for a fellow member of the TOD communinity, what happened to Fleam? I haven't seen him about here for a while now. I know he was planning on heading back to the Bay area on his motorcycle, but I must admit to being a bit afraid for him and his reduced circumstances. Did he make it back to California? With all that has been happening of late, I wonder how many of us will end up like our brother Fleam.
SubKommander Dred
Ha ! Fleam must be thinking of TOD - I was thinking of him just a few days ago. I hope all is well.
Sad to say, but I have no idea what happened to Fleam, but I echo the sentiments of others in hoping he is coping ok.
She said she was planning to return to SF for awhile, didn't she? She was going to ride her bike or something. Maybe she's en route, and without Internet access.
Fleam was a she?!?
This is game plan for brother and others..small mobile,for privacy"big house"for cooking&shower ect
I still do not understand why the reduction is housing prices is necessarily a bad thing.
Easy. Starting in the late 1960s, politicians began promising voters a shiny new Jetsons future where said voters would enjoy the apotheosis of faux-Marxist "sharing" and "fairness" in a new Earthly kindergarten paradise. Princely wages would accrue to all for pretending to work just ten or twenty hours a week at Total Zero Moron Jobs, such as sitting around spectating idly while robots plunk quarter panels onto cars, and setting fire to the production line once in a blue moon for entertainment to relieve the boredom. The new magical self-replenishing common pot would enable all, without discrimination on the basis of shiftlessness, sloth, or rank stupidity, to become overfed owners of vast pseudo-country palaces, shiny flying cars, and great gouts of stuff.
That was Plan A. In practice it never served more than a chosen privileged few in ultra-stodgy, highly unionized industries as in Detroit. Not that it mattered, an even easier Plan B emerged: voters would simply levitate themselves into prosperity without even the "unfair" bother of pretending to earn it. Liar loan, interest only, pay the mortgage and buy lots of stuff out of the magical perpetual increase in value. Oh, enablers would crawl out of the woodwork and become fantastically and enviably rich by flogging the worthless financial paper, but for as long as voters could live far, far beyond their means, said voters would cork up their envy and enjoy the ride.
Well, it turns out life isn't "fair" after all. Plan A failed almost from the start and Plan B went the way of all Ponzi schemes. And that $700 billion is only a down payment on what will vanish into that faux-Marxist rathole of pretense that voters can "share" in and consume what they do not produce. Sic transit gloria mundi.
Paul-
I like your analysis, but you need to lose the "faux-Marxist" view. Marx main emphasis in Capital was production, and the difference between user and exchange value, and how this comes about applying dialectical materialism.
You are closer to his view than you probably realize.
As a political system put in place by a Leninist world view, you are probably correct.
I started with just "Marxist"; that's why it became "faux-Marxist". But the results of the political system were nonetheless horrific (and Marx wasn't around to critique them.)
Bitter, bitter.
The party is over, most of the guests--those that are conscious-- have gone home, the beer is all drunk, and a lot of it is spilled all over the floor. Cigarette butts are crushed out and piled up everywhere, and a few are still smoldering in the funky bedsheets where a few drunken sots are still trying to get it on. The vomit stench is overwhelming.
Time to clean up the mess.
Life is not "fair" for individuals, but summed over a whole society there is a sort of rough justice.
Life being fair reminds me of this:
He must have said that a long time ago, if a car phone was supposed to be impressive.
Around here, higher food and energy costs are starting to bite. Home prices have held up pretty well, but several of my acquaintances are having trouble paying their mortgages. Some of them made the mistake of getting "exotic" mortgages, but at least one got a fixed-rate. She's generally pretty responsible with money, but just wasn't expecting fuel costs to rise so quickly. Her husband is a contractor, and drives a huge van loaded with tools a hundred miles a day or more.
She's cut back just about everywhere she can, and doesn't know what else to cut. I suggested she ditch the cell phones. (She has three children, each with their own cell phone. Costs about $40 each per month.) You'd think I suggested she save money by not feeding her kids. Apparently, it's absolutely out of the question for pre-teen kids to not have cell phones these days.
The cell phone cost is one thing, but objective researchers conclude that pre-teens should not be using cell phones much because of the brain cancer link (supposedly it is more dangerous as the physical size of the brain is still growing). IMO down the road the cell phone/brain cancer link is going to be a huge story (naturally the USA guv is working hard on behalf of money keeping the public unaware).
I'm surprised you didn't mention this nugget:
in the context of the bailout.
According to Gates' rules, Linux does not exist.
Bill Gates never said this. Check Snopes.
Gates has also seldom made any overt statements about his political views, but the little he has said shows him to be a centrist liberal.
And what, sir, do 90% of our capitalists produce? Crap, lies, fantasies, wars, and credit.
Don't blame the workers for noticing their bosses were idiots who started an entirely Republican depression, unless you want to argue that the pre-FDR distribution of wealth was fair because the rich performed the vital function of being brutal, often murderous bullies who sicced the National Guard on strikers about twice a year for 80 years, thus excusing the fact that they were still idiots. Seems to me that what we have now far more closely resembles 1929 than anything that can be blamed on "Sharing".
Seems to me that what we have now far more closely resembles 1929 than anything that can be blamed on "Sharing".
Bingo. That's precisely the problem with living in our kindergarten - the results don't turn out to be what the idle theorizers anticipate from their ivory towers. The free-ride car ran out of gas because nobody felt the need to produce gas or anything else any more. (Note, the resemblances between speculation-triggered panics will be somewhat superficial - one might also look at 1873 and others, not only 1929.)
You are quite right, there is nothing instrinsic in high home prices that make them a plus for the economy. Rapidly rising home prices, on the other hand, worked like a kind of Ponzi scheme, seemingly generating wealth out of thin air. That allowed many, to beieve they were richer than they really were, are therefore for a nation to live well beyond its means. While, it is true that Ponzi schemes generate -or detsroy no wealth, they do redostribute wealth. Usually from the unwary, to the unethical. And when they collapse, a whole lot of losers start trying to get their loses back, causing a lot of unproductive effort fighting over the redistributed wealth, and usually eroding trust in both the system, and in one's fellow humans.
Interstingly, the worst affected place seems to be Iceland. Their banks had been offering the highest interest rates for suposedly risk free savings. They were paying for this by making leveraged bets on the same sort of toxic securities as has sunk other banks. Supposedly Icelandic banks hold six times as much leveraged debt, as the countries GDP!
I'm not so sure about that. I have a gnawing suspicion that this is the Bush Administrations' last f#ck-you before they walk out the door.
This time there won't be any trickle down so we can forget about suburbia.
If they walk out the door.
For bailout to work, housing market needs to mend
"...Experts say the most important thing that needs to happen before the $700 billion bailout even has a chance of working: Home prices must stop falling. "
http://news.yahoo.com/s/ap/20081004/ap_on_bi_ge/financial_meltdown_credit_4
And that's why the bailout is going to be a flop. Too-high debt from too-high home prices is a large part of what got us here. Trying to prop up home prices is trying to put a patch on a balloon that has already popped. The best you'll acomplish is to re-inflate the balloon, leading to another crash. It is far more likely you'll just waste precious resources needed to deal with the crash.
That was my thought.
Rising unemployment in a declining economy will not provide the income-base -- and hence credit worthiness -- to sustain current housing prices
It's very simple, actually: we're only through about 1/3 of the resets (defaults).
IMF Credit Suisse Reset Chart
How can we be anywhere close to a bottom? Meredith Whitney (via Automatic Earth and others) says as little as a 30% decline is mathematically impossible. She's looking at over 40%. Where are we now, about half that?
Cheers
I read that it now costs more to build a home than to buy a used one. During the boom the cost to build a home was less than the cost to buy a used one.
Headlines this morning:
CNN--"$700 billion bailout: Will it work?"
Dallas Morning News--"Bailout passed, but will it work?"
But the one I liked best appeared in the Temple Daily Telegram--"Bailout plan passes: Don't expect immediate results"
A more truthful headline would have read:
"Bailout plan passes: Don't expect any results"
.
.
"...:Don't expect any results"
imo,there will be results: more debt for one. i intend to vote against anyone who voted for this pig with lipstick. that doesnt leave me with many choices, but i can always write in.
I agree, elwoodelmore.
I am so disillusioned with the state of politics in America these days. There is something very wrong with a "democratic" process that doesn't offer the voters any real choices.
Our representatives decided to vote in defiance of the popular will. Will they pay a price? One can only hope so, but I'm beginning to believe that the system is so broken, and broken beyond repair, that these guys will never be held accountable.
I was going to vote for a third party. Then Palin showed up which scares the heck out of me so I was going to vote Dem. With the passage of this bailout(?), I'm back to voting third party.
These people are scum bags and what I found extremely galling -aside from the fact that the bailout won't work - was the inclusion pork barrel tax cuts. Screw them.
Todd
My last holdout for the Dems was David Wu -- who has consistently opposed the Iraq War and the USAPATRIOT Act. Now that he switched his vote and went for the "bailout", I see no advantage at all to a Democratic administration. Toady to power is even more reprehensible than outright naked abuse of power. In my opinion, that is.
I will probably vote for Cynthia McKinney.
Yeah, NeverLNG:
I wrote to Rep. Wu again just before the second bailout vote, but he apparently didn't get his marching orders in time to alter his position. This is it:
So, are you in Washington County? I'm in Aloha.
Alooo..HA!
Thank you for your input. It means so much to us. Without the constant striving of you peasants out there, we could never have sucked the continent dry and turned the bounty of the Earth into concrete ribbons and steel towers and nuclear wastelands.
Democracy is so important, and I hope you know what a privilege it is to be able to actually VOTE for your representatives to the feet of the elite. Please send money.
No, I'm in Clatsop County. Rep. Wu is helping to secure us the blessings of a large Liquid Natural Gas tank (or maybe 6 of them) and an associated police protective force-- all for our benefit!
Mahalo
From a missive from my Senate critter, Barbara Boxer:
Considering our budget problems lately, do you think California might be considered a default risk?
Why doesn't the government simply take the $700 billion and open a bank and become the direct lender and cut out the middle man?
A: It is unlawful for the U.S. government to run for profit enterprises.
Really? Funny... they keep talking about making a profit off the bailout...
Hmmm...
Cheers
Not too sure about that. (What do you call Haliburton, Blackwater, military industrial complex?)
The converse is surely not true, namely, that it is unlawful for for-profit corporations to run the government.
"Not too sure about that. (What do you call Haliburton, Blackwater, military industrial complex?")
Those are (publicly supported) private enterprise, defending freedom.
I've been thinking the same...I doubt I will vote for the either/or ticket. Bob Barr is against the bailout. I don't know much about him. But probably I will cast my protest vote for him:
http://campaign.blog.bobbarr2008.com/2008/10/01/both-obama-and-mccain-ag...
With all these truthful headlines in US press about the bailout, the Washington Post tops it off with a story about Russia's imminent collapse:
Wassup with that?
Perhaps this is a case where someone is saying, "look, things aren't that bad at home, it could be worse!" I suspect it's more the case, "What, your house is on fire? Wait, I've got some really good news... your SOB neighbour's place is about to be torched, too. And for a second time!! Bring on the marshmallows!!"
I heard Robert Rubin, who I believe is Obama's chief economic adviser, spouting this same nonsense the other day on the boob tube.
It's one of the orthodoxies of the school of classical liberal economics, and is part of its modus operandi--if reality doesn't fit your theories and models, no problem, just change reality to fit them.
One of the dogmas of the high priests of neoliberalism is this:
The authors go ahead and break the world down into three types of players. Debtor nations like the United States. Creditor nations like China and India rich in cheap human labor. And Creditor nations like Russia, Saudia Arabia and Brazil rich in natural resources like oil and natural gas.
Russia, if my memory serves me correct, has about $500 billion in U.S. dollar reserves. And it's extremely rich in oil and natural gas, plus controls a good chunk more.
The theory the Chicago Boys tout is this: Russia and these other countries' economies are so fragile that they must continue to sell us their oil and manufactured goods, and continue loaning us the money to buy those goods, because if they don't their own economies will implode.
It's basically part of the neolibreral argument that the U.S. can go on borrowing and consuming more than it produces forever.
Too bad for the monetarist idiots but Russian GDP growth is driven by domestic consumption and not resource exports. Construction (residential and infrastructure) and retail trade in Russia is massive and growing at around 14% per year. The chatter about oil prices shows wishful thinking. Oil prices only began to increase in the second half of 2004. GDP growth was 10% in Russia in 2000 and has averaged about 7% over the last eight years. High gasoline and diesel prices actually hit Russian GDP growth and there was no transition to higher GDP growth after 2004. None of the monetarist twits can explain why Russia's economy rebounded so quickly from the 1998 financial collapse since they cannot acknowledge that there is a physical economy independent of financial pyramids (in the case of Russia the GKO instruments).
Agreed. Russia won't escape a global economic collapse unscathed. But they are in better shape to weather it than we are.
So the USA is too (fill in the blank) to fail?!
I think anything can fail if one really tries hard enough - and "we" seem to be doing just that.
Pete
Yeah.. *0r 'Yeha', as the original typo had it..
I thought the adage wasn't 'Too big to fail'.. but
'The Bigger they are, the Harder they fall.'
I've been looking back to my 'Big Red Joke Book' and Kindergarten for wisdom, lately.. seems no worse than all the others.
"The problem with these Gentlemen's Agreements, is these Gentlemen ain't Gentlemen!" -Mark Twain
Russia collapse imminent? I think this is just propaganda.
It will certainly work quite well -- for Paulson, et al. Of course, it won't for anyone posting here, but then again, it was never intended to.
I keep hearing that Americans opposed the bailout 100 to 1.
House of REPRESENTITIVES passed the bill.
Could it be any clearer that our government represents the 1%?
What the 99% don't seem to understand is the fact that the bail-out is trying to stop the systemic failure of he entire banking system. The 99% are too ignorant (not necessarily by their own fault) to understand the economics/politics playing out here.
There is a good reason governments don't put many bills to referendum: most of the populace couldn't make an informed decision that is correct becasue they are not informed! Also an ignorant population is a population that is easier to control.
Marco.
No, it's not. It's just an excuse.
IMO, this is typical of Bush's "black or white, with us or against us" thinking. One representative said it came down to, "Either you believe we're on the verge of economic catastrophe, or you don't."
Er, no. Many of us believe there is a serious problem, but that this is not the solution. It won't fix the problem. And, I suspect, it's not meant to. At best, it's meant to put a bandaid over it until after the election. At worst, it's meant to allow the wealthy and connected to loot the country while there's still anything worth looting.
That is a very well written summary-what is surprising is that not everyone can perceive something that appears relatively transparent.
All you are pointing out is that an elite cabal rule the country and somehow the 99% were duped into thinking they lived in a democracy. Tell us something we don't know!!
IMO you are not aware that these recent actions have raised the bar somewhat-this is not business as usual.
Agreed but don't shoot the messenger! The bill will go through end of story. My comment up above is neither disagreeing or agreeing with the bailout, just a plain simple statement of what they are trying to achieve by it.
personally I think there is going to be a lot more default than $700bl, but we are not discussing my opinion here - just that of the the people and whether theri opinion even counts in this "democracy"; a word the dear Americans love to use a lot.
Marco.
Er...the bill already went through. It was signed into law yesterday. That's why we're all so plecked off.
You won't miss that $5700 in cash! It will just come out of healthcare, education, social welfare and environmental planning. (Forget defence budget cuts!)
Sad but true.
Marco.
Even more reason for people to be angry.
You won't miss that $5700 in cash! It will just come out of healthcare...
To me, this is the next industry to tumble. There's got to be a tipping point where the health insurance industry doesn't function. If the uninsured segment of our population grows to 55 or 60 percent... which is coming, as we go into recession... how will these health insurance businesses support themselves or the hospitals, or the pharmaceutical industry?
Problem is, the welthier part of the population ie middle America that has full health insurance are the people who most likely shunned or ignored (what I saw as positive propaganda) Michael Moores film, Sicko. So the issue gets buried cause the people with influnce got the money and the healthcare.....they're allright jack.
Marco.
"Healthcare" is too big to fail. It might be the major job-creator in the country, possibly even bigger than "defense".
I imagine that we are on the road to universal "healthcare" of some kind, but it will not be run by the "government". It will be another "bailout" of an "industry" resulting in two or three "competing" giants (Aetna, United Healthcare, WellPoint?) financed by the "government". The future earnings of taxpayers appear to be boundless-- something I don't understand, but my Congressmen do, so I am reassured.
"Healthcare" is too big to fail.
Ford's sales have tanked (-34% to last year), banks and insurance companies are insolvent, retail is the walking dead...
How many will lose corporate coverage over the next 6-12 months?
When they do... who's going to pay the monthly heath nut before the mortgage?
Another day older and deeper in debt.
If they take away the mortgage interest deductions and give give tax credits for amounts on deposit, then raise interest rates, all sorts of people might get interested in saving money and borrowing less. But no, it is all upside down.
I agree that healthcare spending is likely headed for a fall. The US spends a HUGE amount of disposable income on healthcare, something like 15%, which is way more than most other countries. So it's certainly possible to spend much less money (and even get healthcare outcomes that are better in many respects).
The passage of this bill will be very closely watched from here on ... and political meddling is not done as congress will reconvene to see that "it never happens again". Who knows what great ideas congress will come up with next. IMHO, I think they are trying very hard, but only second to their efforts to get re-elected, and after voting against their constituients desires will need to work even harder. Wait to hear the spins on this one...!
Seems it will be at least a month before this bill begins taking any effect. Who knows how markets will react in anticipation ...not knowing how it will work exactly. A whole new financial industry is being created by Paulson and team. Does it go one forever? Is there any provisions in the bill for this new establishment of bailout business to no longer be necessary? TARP...how about Bailouts R Us. Does anyone think Paulson will make us any money with this venture? Warren Buffet said it would a few days ago.
http://www.foxnews.com/story/0,2933,432641,00.html
In 3 months Paulson will be back working for Goldman Sachs making millions for himself selling toxic financial waste to the Federal Government using the program he designed and put into place while "working for the government?"
Can you say and spell "Conflict of Interest"?
This is a good place for an aside, but a highly salient one:
To those of you out there who have said over the last two years impeachment was a waste of time, that it would be too disruptive, and, hey, what the hell else could they possibly do?... Now you know.
Welcome to what happens when you choose expediency over what is right.
:/
If this thing is really about lack of confidence, noone trusting anyone else to be able to pay them back, it should strt working instantaneously. If bank A now believes that bank B might be insolvent -because Paulson will guarantee it we should see things loosing up pretty quickly. If that doesn't happen, we will know we are in very deep doo-doo, as the powers that be don't have a clue what will help.
we are in for some trying times....not only are we in a liquidity problem,and a banking confidence crisis,but we are also in an energy crisis.even if we fix the first 2 we will keep pounding are heads on the ceiling of peak energy,you only have to read the headlines from bloomberg.etc.etc the energy shortages are here and are real.the world economy has entered that cycle every adict fears which is the highs are never higher than the lows are low...
This is gonna cost way more than $700 billion -- it already has!
http://business.timesonline.co.uk/tol/business/industry_sectors/banking_...
U.S. banks borrowed over a trillion from the Fed in 3 days!
Where does the Fed get its money? Either by just printing what they need, creating it out of thin air, or the Treasury Dept. sells securities for a fund raiser. The net effect is inflation, more governmental debt (we have to pay a return on securities), or both!
Visit http://www.chrismartenson.com/crashcourse and learn how all the stuff is connected.
Funyy you should say that, I was just looking at M3 money supply. Still going strongly upwards (despite gorvernment oficially not recording M3 anymore - much discussed in many blogs!!)
http://www.nowandfutures.com/key_stats.html
Marco.
They know what believe - they know what they want to believe.
Marco, I think the argument you make is valid under many circumstances, but not so this time. What you are saying is in agreement with the case made by Edmund Burke so many years ago when he said, "Your representative owes you, not his industry only, but judgment; and he betrays, instead of serving you, if he sacrifices it to your opinion."
The difference in this particular set of events is the trustworthiness of the executive branch in the waning days of an blundering presidency. Moreover, the "bail-out" act is in keeping with other legislative initiatives by this administration that have tended to augment executive powers at the expense of the legislative without the brakes of legislative oversight or judicial recourse.
IMHO, the American people have every right to be wary of the shenanigans perpetrated by people who have betrayed the public trust over and over again. Particularly this close to an election.
The American people suspect, and I believe rightfully so, that this crisis is being used as a ruse to deprive people of any say in policies that directly affect their futures.
It all boils down to trust.
Well dagnabbit those 99% need to get out onto the street and protest BIG style instead of being the anesthetised bunch of spineless OJ simpson fixated surrender monkeys. Where is this "American pride" that was the envy of the rest of the world?
Takes me right back to my first point that an ignorant population is one easily controlled.
Marco.
Part of it is being shown in places like this blog where citizens are voicing their determination to vote for third options.
Moreover, my impression from what I read is that the level of dissatisfaction out there is palpable and very well may take on tangible expressions. My hope is that it will be manifested in the form of peaceful protest.
So far, I suspect the reaction is being muted by people's sense of vulnerability and insecurity. What may serve as a tipping point is if more and more figure out that they are losing everything anyway.
"He hath no power like he who hath nothing to lose."
But they know ther's a new watch coming. The protest if there is any will be in the form of ousting the Repulsivecans, followed by a 1-2yr probation period for the Demoncrats. If smelly stuff is still hitting the fan by then.....maybe, but not before I don't think.
""why do we protest now when government's going to be changed" sort of attitude.
Marco.
Assuming "Repulsivecans" means Republicans, your reasoning is contrary to reality. A Republican administration introduced the bailout bill, House Democrats modified & voted for it, House Republicans voted against it, both parties in the Senate made it overflow with pork barrel spending & passed it, House Democrats passed it, an insufficient number of House republicans tried to stop it and a republican president signed it. Both the democratic and republican presidential candidates voted for it and extolled its virtues. I do not see how their conduct absolves either political party, but rather proves they both pander to the corporate oligarchs. Both parties need to be ousted.
Vote for a third party candidate.
My reasoning was that the people would vote Democrats in the November election as protest, give them a chance at full govenrment and in 1-2 years if they still look like losers, only then would we see civil uprising and mass protests. My reasoning had nothing to do with who voted in what because it was amended by whoever. I agree they likely both take it up the a** from the iron triangle.
Interestingly we have the same sort of situation in the UK. But everyone thinks "who is going to vote in the Lib-dems" so they just all vote either safe Conservative or labour - it's classic sheeple mentality.
Marco.
The strength of the Internet is also perhaps its most profound weakness. By focusing our energy in blogs, on keyboards and screens, we stay out of the uncomfortable and possibly dangerous streets.
I used to wonder if the Regime would continue to "allow" the Internet -- now I see they have everything to gain from not only allowing but actively promoting it. It diffuses anger that could be turned against the rulers into harmless electrons. I am totally guilty of it myself -- but it is radical masturbation.
Bingo! Meeting online to express mutual outrage isn't nearly as powerful as commiserating in person. It is the latter type of activity that TPTB fears the most.
So, what we now have are disparate groups of the most individually informed people in the history of the planet, but who for the most part are physically distant from one another. Nothing really to cause much official concern, imo. All of us armchair radicals will be easy pickins.
You can commiserate all you want. Just don't burn down the institutions that produce fresh waves of zombies for the TPTB to use, namely, universities and MBA schools who brainwash the masses into believing in "economics" and the consumerist road to prosperity.
When is Bill Maher going to produce his next movie, "Economaniacs"?
In my tyrade directed at the apathy of the American people, something just occured to me. What they are really missing is a real "champion of the people". I don't confess to be being alive when JFK was around but he seemed like a real nice guy. So thats what happend to the good guys when they try to oppose the cabal that really control the people.
Sorry America you aint got no chance of a champion.
Whereas we've got good old Gordie Broon and Sarky looking aftet the little people:
http://news.bbc.co.uk/1/hi/uk/7652459.stm
have no fear.
The Prince of Darkness is back.
http://www.dailymail.co.uk/news/article-1066425/Arise-Lord-Sleaze-Brown-...
I think JFK was the right president at the wrong time. In other words, he was the sort you'd want in a crisis of national survival, but not during prosperity. He ran on a mythical platform of Soviet military superiority, then his administration was a series of hard lessons about the myths of the Cold War; first he learned at Bay of Pigs that he couldn't just overthrow any government he pleased, then he learned in the Cuban Missile Crisis that the Soviets had their own fears that had to be considered. "Even the Russians love their children", as he said afterward. Finally he realized that the regime he was backing in South Vietnam was a disaster, but powerful forces in his own government stood in his way...
But the important thing is that he was teachable, unlike the older, dumber men who usually hold this office. He came to see that the greatest threat wasn't Red aggression, but the social injustices at home. It was his brother, eventually, who incorporated this into a new idea of leadership not based on war tribalism that I think was America's last chance.
Then he planned to abolish the Fed ...
This was posted before, but it seems apropos to post it again (E pluribus hokum or When the gamblers bail out the casino):
Stop looking for champions. They never existed.
Whenever the people save themselves, the PTB just assign the credit to a designated hero in the history books.
Marco,
You have it backwards. Your claim shows it is you who doesn't get it. For the first time in a very long time, the people do get it. They understand the bailout is not, as you dubiously claim, intended to save the system, but is a financial rape of the people.
(I read your comments below where you not only contradict yourself, but deny you said what you said above. I thought you were just having this problem with AGW, but it apparently is just how you post. It makes discussion with you very difficult.)
Cheers
CCPO, I wasn't contradicting myself, I was just pointing out what 'they said' it was for. You are always trying to put words into my mounth or imply I have some bias or slant on it. As it happens I agree with you that it may not be the best idea! IT WAS NOT MY CLAIM. NOWHERE IN THERE DO I SAY IT IS MY CLAIM.
Why is it that whenever someone discusses something with YOU it nearly always ends up in that said person being attatcked rather than mainly a discussion of the topic in hand?
Maybe the reason people here don't visit you blog (as you complained in your last thread) because they find you objectional and rude?
Anyway, It IS a financial rape of the people to the tune of $5700 per taxpayer but I don't see droves of sheeple out there on the streets (which we discuss the resons for above) protesting.
Now that the bill is passed are you going to make another puke forming righteous declaration of how proud you are of the American people? Me thinks you are a bit bitter about that falling flat on it face.
Marco.
Then you are a very poor communicator. I stick with my previous assessment: you get caught in saying something, then pretend you didn't say it. Happens a lot. Whether poor rhetorical skills or willfully misleading, not very worthwhile for the rest of us.
I think you will find your discussion partners decreasing over time unless you either a. learn to state your thoughts clearly or b. stop re-writing your own history.
Friendly critique. Take it as you will.
Cheers
PS. In all seriousness, you seem to be quite young. Perhaps this isn't the best place for you to be spending your time?
I guess some might call 33 young! Thankyou. I think what you mistake in my statement are a stance or a position that you want to see me in ie this side or that side....but for me sometimes it's just about seeing things for how they are and i've not yet jumped to a side. I think what you mistake for misleading is actually me sitting on the fence! Apologies. My discussion partners have neither increased or decreased and I have often found strong objection to some of my statements.....as far as I see it i'm just being open eneded with he facts.
Take my post up top - very first that got everyone hot under the collar....big negative rating...but I fail to actually see what is incorrect about my statement and no post below actually points out what is incorrect. The bailout was orchestrated to "stop systemic failure in the banking system" - I neither agree nor disagree - but thats what it was put in place to do. Many may argue there were darker movives. I don't know (and I understood perfectly Leanens response)...I wish I were a fly on the wall at some clandestine Bilderberg meeting! Furthermore my statement about the people being easily controlled when ignorant - thats so true and never has propaganda been more effective than with a pop. under control.
They want the truth.....THEY CAN'T HANDLE THE TRUTH!!!!!!!
Marco.
33? Damn... that's shocking. I really thought you were a high school or college student. And, no, I critique what you write on its own merits. It's not about pegging you into a role. I could not care less what your position is or what your beliefs are. A post either has merit or doesn't.
What is shocking is the style of your postings vs. your age. For example,you keep claiming in various posts nobody has proven you wrong, when they have. You simply fail to see it, or can't allow yourself to. Your logic, to put it as politely as possible, is often flawed.
Carry on.
Cheers
Funny you should say that. I remember waaaay back University lecturers/high school teachers telling me I fell squarely in the "Lateral thinking box". I didn't think that excluded me from the Logic box though!
A lot of the stuff we discuss here often doesn't have a "logical conclusion" in the sense of one correct answer/person: we are talking bout problems where ultimate solutions could allow mankind to prosper indefinitely and I don't see how opinions can be so easily defined right or wrong. Lets face it a lot of what we talk about is mere conjecture.
Marco.
I thought it was a language barrier. I had assumed Marco's first language wasn't English.
I think i'll leave you guessing.......:-) Although the engineers I work with arn't exactly renowned for their writing ability either! I scraped English at school and it wasn't exactly scrict requirement for any part of my education or job function. I do live in Scotland just now though.
Anyway quit with the rudeness already! There's no language barrier - I still maintain people are trying to imply I'm taking some stance when I'm simply stating how it is. The Bill got passed end of stroy and it was done to 'save the banks/fiancial worrld from systemic failure' - I don't give a rats ass if you don't believe that. Heck I don't even believe it. But there you have it - that is the official line.
We will all move on, like we moved on after the debacle that is Iraq - that traversty of justice that was based on lies - but like the spineless sheeple we are, we just carry on.
End of story. Show me how I am F***ing wrong?
Marco.
Marco - the proof that you are wrong is that so many people misunderstand you. If it was just one person, you might say it's their problem. But when a whole bunch of people think you're saying the opposite of what you claim you are saying...the problem is you. You need to amend your style of communication, or you will continue to get the same reaction.
CCPO? I clarified my position just a few posts down from my original post at which point people did start to understand. Then CCPO jumps in hours after apperently not accepting my clarifications and responed to my first post!!
However point taken, I will try to amend my style.
Marco.
Here is a perfect example. First, it wasn't just me, as Leanan pointed out. It is not useful nor logical to pretend I was the only one that misunderstood you. Second, I clearly stated I had read your other posts and found them contradictory. Third, nobody "started" to understand you, you changed your statements. No, you didn't clarify, you changed them. If you feel otherwise, perhaps it is a language issue, in which case you must get in the habit of not making declarative statements where your meaning is not declarative. I should point out, as a language teacher, the supposed mistakes/errors you are making are not anything I run across with L2 students. They tend to be structural. You are simply contradicting yourself.
There is more - I think you are being self-contradictory - but it is no longer worth the effort. Tighten up your prose, or I suspect, as I said already, you will slowly find yourself ignored by greater numbers of posters here. Up to you.
Cheers
PS. If you are an L2 learner, feel free to contact me for suggestions on structuring your arguments, etc.
But thankfully not by you, eh? Gives me someone to play with. I didn't change my position, you just read between the lines and stuck your own (wrong) assumptions in. And (if you will allow me the 'and' at the start of a sentence) by the way you have still not explained what my contradiction actually-specifically is. I have a feeling the percieved contradiction is between what position you are assuming I have taken and what I have said, not about any two separate statements I made.
Furthermore you are the only person on this site I have ever gotten into these ridiculous lenghty debates with, where we debate my credibility, rather than the point I make! Usually if I make a stupid/erronious statement the 'opponent', if you like, just ridicules my point - but not usually me! You just seem to endlessly biccer about me without pointing out the specifics of what I say that is in error.
You want to know what is the funniest thing about this whole thread CCPO: in the 40+ posts no one pointed out that souperman2's assertion that the bailout "was opposed 100 to 1", according to the official polls, is absolute BS. The polls are all over the place from 75% favouring a modified bailout to only 25% say they favour the current bailout. Google "bailout polls": figures are all over the place but certainly nowhere like 100:1!! Then souperman2 pipes in with.... "thats why I don't respond to him" .......like he's not just posted some BS fudged figure: a figure that God only knows where he "heard".
Marco.
Here ya go:
You have stated two reasons for your post: Your first was that you were pointing out the stupidity of the electorate while the second moved the goal post to be about whether their opinion counts.
Then this:
which wasn't your first point at all. But you followed that with this:
No,you never said it was what "they" said it was for. You made a declarative statement and stated Americans were stupid for not understanding it.
Then you said this:
ALL of it was your claim. That is what you wrote. If you intended otherwise, you failed. Saying, for example, that the bailout's intent was to "stop the systemic failure of he entire banking system" is what they said is bull. You did not say, THEY said it. You stated it as a fact then claim you did not.
We can prove it was stated by you as a fact because you claim 99% of Americans are too stupid to understand this. You are making declarative statements throughout. No conditionals, no modals,no "IMHOs," no attributions to others... nothing. Until someone calls you on what you have said.
Then you go and say THIS:
You contradict yourself here again. Bizarre.
For frick's sake, man... ya communicate like a Magic 8 Ball.
As for your statements about me persecuting you,and doing so to everyone: what weed are you on? I have had run-ins with you and Mud of late. That's it. In both cases I addressed YOUR input to TOD specifically, and in both cases I have been correct.
As for your assertion I complained people here didn't read my blog, your reading comprehension needs work. Go read it again. I THANKED people here for going there as they were the only readership I have. I was disappointed, not complaining, that the friends and family I directed there didn't appear to have been by. Given the blog is written FOR THEM specifically and any one else generally, it is a disappointment.
And, friend, anyone who would not read a blog because they just don't like the blogger is a mindless fool. They are welcome to stay away.
Toodles
One of the big problems is that people come up with their ideas of "What I think" and "What people who are wrong think", and then assume everyone who isn't saying "What they think" must be saying "What people who are wrong think" rather than reading stuff "from scratch". I suspect I don't find Marco as confusing to read as those who are firmly committed to a particular view and want to vent because I haven't got a particularly strong view on the bailout.
However, Marco probably should change his style of communication because the unfortunate fact is that to communicate effectively it's not enough to say clearly what you mean, you've also got to figure out what misconceptions people will jump to and defuse them. (It took me a while to figure that out.)
Nothing unfortunate about it. That is the essence of communication, and something most human beings do naturally, without even thinking about it. You have to understand your audience. You would not speak to a 5-year-old child the same way you would speak to a 50-year-old nuclear physicist.
Yes, noted thankyou.
I'd question that it's natural. It took me writing about 3 papers before I figured out that I didn't just have to state my points clearly but that readers (who work in the same field and are perfectly knowledgable) would come with their preconceptions about how people would address problems, and that they'll skim over a couple of lines and conclude that the entirety of what you're saying must be the exactly the same way that they did it, or the last time they considered in detail someone elses unsuccessful approach to the problem, when they last looked at the issue five years ago. (It's asymetric because I was coming to a new field so I didn't see this in myself then. Now I do have such a background and, although I try and guard against it, I'm sure that now I fall guilty of skimming and imposing my preconceptions a lot.) So you've actually got to figure out what their preconceived ideas will be and then subtly (in a way that doesn't sound condescending) hammer home that you're not saying that but something different. The "unfortunate" bit is that once you've convinced someone to read what you're saying without jumping to conclusions, the original verbiage is actually fine, you've just got to put enough subtle "this isn't what you think it is" messages down at key points to "derail" a knoweldgeable but quick reader from their well-known thought track and consider the words you've actually written.
I have now decided this morning to take a stance. Shock horror.
1) I don't think the idiots who took out loans on houses they couln't afford should be in any way helped. They knew what they were doing. I don't buy all this evil morgage pusher shit - they just made it easier by spoon feed the same crap those people knew was a BIG LIE - that they could afford the morgage.
2) I don't think the bailout in it's present form is a good idea. But neither do I feel letting all the banks go to the wall is an option either as it is a re-ordering that I don't think the US could easily surviive. It would be a bit like shock peak oil. Some might say...exactly..it's a re-ordering that is much needed...well agreed but I can't imagine the chaos that would reign under guidance of the present neocon wingnuts. You've got the wrong leadership right now and I have little faith that the Democrats can restore the quality of leadership needed. I hope i'm wrong.
Marco.
"...apparently is just how you post"
Yes it is, which is why I don't respond to him.
Interesting, I see from your post that you evidently believe there are certain situations, such as this financial crisis, where "powerful" people present a scenario of "the sky is falling" in order to force hurried and unreasoned decisions in order to accumulate and consolidate power. Though I agree with Marco that the danger is real, I also feel further government intervention will likely make a bad situation worse. Can you think of any other similar, "the sky is falling!!!" scenarios where powerful people might try to accumulate and consolidate power?
Looks like America has found another source of liquidity for it's overvalued real estate and over-leveraged banks.
What? Strong armed tactics to get what you want from an elected legislative body? Surely you jest.
That would never happen in America!
Sucks to be a conquered nation, doesn't it?
The drivel of Pravda on the Potomac (aka Washington Post) highlights what is wrong with the USA media: too much wallowing in wishful thinking. This article reminds me of the nonsense piece in the Atlantic Monthly in 2001 (http://www.theatlantic.com/doc/200105/tayler).
dissident, the heading in the Atlantic article, "Russia is Finished" has a hauntingly relevant ring to it:
Who is "this once great power"???
I sent the link to a Kazakh MD that is studying Public Health at Tulane (New Orleans). He has described the state of public health in Kazakhstan, under the Soviets, in the 1990s and now.
It is somewhat different, but not radically so, from that described for Russia in the Washington Post.
The gov't is raising the health care budget steadily @ 10% every year (using oil money). The limited increase is because more money is perceived as leading to waste. They are struggling on how to address basic issues of public health and medical care. That is the reason for his being here (and other students elsewhere).
The will is there (in Kazakhstan), the money is there (oil money), but the "how" is still open.
Best Hopes for Better Public Health everywhere,
Alan
Regarding the Colonial Pipeline story, I found this longer story on the internet:
Farm soiled by oil: One estimate says 3 million gallons clogged in pipe
I see quite a few here at The Oil Drum have their undies in a knot over the passage of the "Bailout Bill."
But did you that this bill now contains the following:
Sec. 101. Renewable energy credit.
Sec. 102. Production credit for electricity produced from marine renewables.
Sec. 103. Energy credit.
Sec. 104. Energy credit for small wind property.
Sec. 105. Energy credit for geothermal heat pump systems.
Sec. 106. Credit for residential energy efficient property.
Sec. 107. New clean renewable energy bonds.
Sec. 108. Credit for steel industry fuel.
Sec. 109. Special rule to implement FERC and State electric restructuring policy.
Sec. 111. Expansion and modification of advanced coal project investment credit.
Sec. 112. Expansion and modification of coal gasification investment credit.
Sec. 113. Temporary increase in coal excise tax; funding of Black Lung Disability
Trust Fund.
Sec. 114. Special rules for refund of the coal excise tax to certain coal producers
and exporters.
Sec. 115. Tax credit for carbon dioxide sequestration.
Sec. 116. Certain income and gains relating to industrial source carbon dioxide treated as qualifying income for publicly traded partnerships.
Sec. 117. Carbon audit of the tax code.
Sec. 111. Expansion and modification of advanced coal project investment credit.
Sec. 113. Temporary increase in coal excise tax; funding of Black Lung Disability Trust Fund.
Sec. 115. Tax credit for carbon dioxide sequestration.
Sec. 205. Credit for new qualified plug-in electric drive motor vehicles.
Sec. 405. Increase and extension of Oil Spill Liability Trust Fund tax.Sec. 306. Accelerated recovery period for depreciation of smart meters and smart grid systems.
Sec. 309. Extension of economic development credit for American Samoa.
Sec. 317. Seven-year cost recovery period for motorsports racing track facility.
Sec. 501. $8,500 income threshold used to calculate refundable portion of child tax credit.
And, of course, the big one:
Sec. 503 Exemption from excise tax for certain wooden arrows designed for use by children.
Thanks to the Coyote Blog.
http://www.coyoteblog.com/coyote_blog/2008/10/it-took-two-ing.html
Now what do you folks think?
I guess the logical questions are 1. what do these measures cost and 2. why is it necessary or advisable to take trillions of taxpayer dollars and give them to connected financial firms in order to enact renewable energy credits that cost the taxpayer a relative pittance?
We knew all that. It's been discussed.
I still hate it with the intensity of a thousand burning suns. It amounts to, well, lipstick on a pig.
Yes. Each of those should have been passed or not in their own right. It leads one to wonder: if the neo-cons/repubs were willing to give in on alternative power subsidies.... how badly did they want this thing? And that's not a good thought.
Cheers
If you want to get really depressed about the state of American politics, just remember that Barack Obama pushed harder for Paulson and Co then he has pushed on anything. His financial guru is Robert Rubin, who is basically Hank Paulson's cousin. I know the neocon Repugs start the fights, but then the Dems jump in to kick the public after they do down.
Completely agreed.
Cheers
The bailout bill also provides a tax cut related to the alternative minimum tax which is supported by Republicans.
I think there's a lot of room in a $700bn bill for bribery and flattery.
I do not eat Green Eggs and Pork!
I do not eat them Mork from Ork!
(Or Orks from Moria??)
Bob
Or kindly refer to Mel Brooks' History of the World, Pt1
KING LOUIS
"Oh piss-boy!" .... tinkle, tinkle, tinkle.. ploink!
"Keep the tip!"
PISS-BOY
"I'll get it later.."
(It's still good to be the King!)
Alright.. let's call it by it's proper name ..
K-Y Jelly.
Of all those add ons the wooden arrows thing is the only one I believe will pay off.
We need to start training a new generation of hunter gatherers.
I think the banks are much richer and the citizens much poorer and the constitution further gutted by allowing governmment to purchase securities and bail out international banks or companies for that matter, oh along with owning the mortgages on a tremendous amount of previously private property. But who knows perhaps this band-aid will allow us to recover and I will happily feel foolish.
I have a question regarding tar sands and oil shale in connection with coal. As everyone reading this probably knows, recent studies have suggested that coal may be as limited in abundance as natural gas is.
But what about substituting the vast deposits of tar sand and oil shale directly for coal - in an unprocessed form - by burning them to generate electricity? Is this feasible? And if so, wouldn't it effectively make coal abundant for at least the next hundred years?
There were problems transporting the tar sands. Rail lines are insufficient to carry the load. There is a problem with emissions and sand disposal. Most raw hydrocarbon fuels contained sulphur.
The tar sands were stripped of their bitumen in floatation cells and the bitumen was upgraded to SCO-Synthetic Crude Oil in multibillion dollar upgraders onsite or at remote locations after the bitumen was blended with diluents or synthetic oil and shipped via pipelines.
Heavy oil was discarded as non-commercial hydrocarbon discoveries. People have been trying to develop heavy oil tarsands deposits using mining, steam, or solvent extraction methods. There is a fireflood project in Alberta (Whitesands) that has yielded much sand. I have not been able to get Petrobank project bitumen production numbers since 2007.
A Rigzone heavy oil information site sponsered by Schlumberger.
http://www.rigzone.com/howitworks/heavyoil/
Whitesands Update
The sand problems appear to be fixed and process efficiency greatly improved.
The liquid oil they are producing--up to 120 to 150 bpd--as Alan Drake noted, is slightly lighter than asphalt.
If they are talking about liquid condensing, it is condensate, well over 30 degrees API, probably around 55 API gravity or more. And note that they did not give a volume measurement for the condensate.
Lab tests indicated CAPRI might produce up to 20 API or lighter oil. So far the CAPRI test is a failure. These pilot well tests are very expensive. The air injection theoretically required 1/2 an MCF of natural gas equivalent per barrel of oil produced in order to operate the air compressor/s, actual field results may vary. The earlier wells' production of up to 400 barrels of oil per day is a suspect number as they do not give you the average daily production over the life of the project. Ccompare what they produce today relative to what they produced in their first three months, they may have been producing more back then. Some toe to heal operations experienced high rates of production near the heal and lesser amounts near the toe due to well bore friction. Wonder if oxygen circulation becomes a problem as areas bypassed continue to smolder while the flame front is out ahead. People have experimented with fire flood for thirty years and have found only limited success in certain field conditions. Some even tried pure oxygen injection and then abandoned. Oilman Bob wrote about failed fire flood experiments in a Texas heavy oil region before he passed away.
Petrobank once issued a press release that their subsidiary Petrominerales had completed a discovery well in Columbia producing 10,000 barrels a day. Some time later they issued a statement that the well produced mainly water. Some wells in Columbia produce 97% water.
Petrobank may or may not have a chance with this technology. Success is based on the show me doctrine. Show me your success if you want me to believe you. Numbers can be misleading.
Most radically new designs in any field are failures - at least initially.
FWIW, this news release is just a single datapoint and nobody is counting on THAI/CAPRI for their survival.
My own WAG is that shallow geothermal will end up as the preferred heat source for extraction. Most people seem to think that it is at least another decade before a true *next generation* pilot plant can be built.
There are a lot of companies spending enormous sums on differing approaches. At the end of the day, one or more of them is likely to be successful.
As for expectations, my hope is that the oilsands can provide enough output to keep the NA economy from total collapse for long enough (50+ years) to do the needed structural changes.
I know the bailout is maddening, but one thing no one brought up is the proper reaction. Besides voting third party in the future, the most important thing is to protect yourself now. This bailout will just add momentum to the looming collapse of our currency under a growing mountain of debt. Since people on this blog are far more informed than average, you still have the chance to protect your savings. Transfer everything you have to precious metals and take delivery ASAP.
Glenn2,
No,please no; not PMs :-). Ok, seriously, there are those who believe PMs have a store of value, presumably you, and, others, like me who think it is the worst possible action to take.
Let's start with a simple example: You buy 1 oz of gold for $1,000 and I buy $1,000 worth of storage food. Can you survive eating your gold? Of course not. Can you "buy" food with your gold? Maybe, but I wouldn't count on it. As I have said before, I wouldn't sell my food for your gold since it has no intrinsic value to me. If I do sell you my food for gold, what do I actually do with the gold? It doesn't make my life easier or better. The only alternative is to find someone else who will give me something of actual use for the gold. Frankly, I see this as a Ponzi scheme.
There is also elements of risk associated with gold/other PMs/precious stones. They can be confiscated. Their value is in the eye of the beholder since they have few natural uses. There may be no market to "sell" them in order to convert them to something that has intrinsic value such as food.
My suggestions would be to: First, eliminate debt. Second, buy real goods that can be used directly or bartered. Third, invest in learning useful skills.
Todd
Buying foods:
I keep a Sharpie 'write on anything' pen in the kitchen and write the date on EVERYTHING I buy so I know how long it has been on the shelf. Big help in keeping your stock rotating properly.
A good booklet for $1.50 @ is "Essentials of Home Production & Food Storage":
http://deseretbook.com/store/product/0183237
This booklet covers not only food information, but also other valuable emergency planning info. It is put out by the Mormons, but I have bought copies and never had anyone come try to convert me. I would recommend everyone on TOD get a copy (you can ignore the religious denomination content).
Todd,
While I agree with your suggestions, I feel that PMs also serve an important function. Barter can be very cumbersome and inefficient, especially when differing values need to be exchanged or trade is conducted over appreciable distance.
PMs serve as a store of value as well as medium of exchange. Here is a story explaining Federal prisoners' using a Pack of Mack as currency:
http://online.wsj.com/article/SB122290720439096481.html?mod=yhoofront
All this said, I recommend circulated American silver coinage (so called 'junk silver') over gold.
Errol in Miammi
A couple of hundred dollars worth of nickels would be worthwhile. Current coin melt value of 4.12 cents (it has been up to 6 cents), a nickel has intrinsic value and can be used in everyday commerce tomorrow if need be.
During the hyperinflation of Germany, small coins held their value. A silver mark would be given for something worth, say, 85 pfennig, and 15 copper pfennig would be given in change.
I can see nickels serving the same role with junk silver.
Alan
A US nickel is 5 grams of 25% Ni 75% Cu
It's likely a decent idea but just remember that the renumeration for gold was set by the government in the 1930s and possession of gold then outlawed.
I think it has been done before and is very disgusting.
It was called Orimulsion. (IIRC)
The toxins are outrageous (again IIRC).
I will try to dig up a link or two.
here is a link. (there are many)
http://www.elements.nb.ca/theme/fuels/orimulsion/mlushington.htm
Even I, a notoriously evil AGW denier would balk at this...:-)
Could you burn it in an IGCC plant to clean the process up a little?
What I meant, though, was just digging up tarsands, putting them into freight trains, and burning the stuff at (perhaps suitably modified) coal-fired power plants without any further processing. Ditto for oil shale. Can this be done? Doesn't the stuff burn if you just apply a flame to it?
PhilRelig,
I've read that "oil" shale has been been burned directly in in power plants in Estonia or Lithuania. You might want to Google that...
Errol in Miami
Right. So why can't it be done elsewhere, as a replacement for coal? Wouldn't it effectively extend the world coal supply for several decades, assuming it is thermodynamically and technically feasible?
It is filthy dirty, very heavy to transport mixed with the shale and has a terrible EROI together with high CO2 emissions.
You burn it when you are desperate.
That will probably describe most of us shortly.
How well or badly do oil shale and tar sands compare to low-grade coal in all the relevant regards?
I am no expert - you have a choice though - you can either try the high tech route of extracting the oil, or go the low-tech road of burning it like coal, but obviously it is less efficient as you have got all the shale still in it, as opposed to coal which is already extracted from the rocks.
This means that the resource is very heavy, so you don't want to be transporting it far by train - the best bet is probably to burn it near the excavation and build transmission lines for the power.
The exact figures are going to depend on local conditions, with variability in how much oil the rock contains, ease of access to build transmission lines, proximity to where you want to use it, and so on.
Think of it as coal's dirtier, lower energy brother if you want to burn it rather than extract oil first from it.
The good news is that it is relatively low tech, so the US in particular is not going to run out of energy anytime for the next few decades.
Here is one link:
http://www.planetark.com/avantgo/dailynewsstory.cfm?newsid=47374
I'd just like to add a couple of graphics from the Energy Export Databrowser to augment the stories on Egyptian natural gas and Indonesian oil imports.
So much of what we read in news stories is related to our need to create stories for what we see. Sometimes those stories depict actual causal relationships that describe past behavior and allow us to make predictions into the future. I believe the explanations in the stories above describe, to a large extent, valid causal agents in the situations of those two countries. I believe it so much that I feel comfortable simplifying things to the one-liner explanations I have provided for the data graphics.
However, I am currently reading The Black Swan by Nassim Nicholas Taleb. In this book he rails against the Narrative Fallacy whereby we impose structure, in the form of stories, on top of past data. These stories help us decomplexify the world and make it easier to understand and give us the impression that we can predict the future. In the world of Newtonian mechanics, this is a fine thing to do and our predictions are very good.
Taleb's point, however, is that we far too often try to apply our narrative 'understanding' to the realm of human endeavor where the statistics are very different and indeed not known. Our ability to predict is often much less than we believe -- e.g. 'Experts' predicting only the direction of oil price movements are correct only 49% of the time. (Go flip a coin guys!) In these cases, our stories get in the way of accurately assessing what could happen.
The reason I am going on about this is that I feel that many of us at The Oil Drum have too much faith in our own stories about what is going to happen. When oil production is seen as an application of physics and engineering it is tempting to believe that we know what we are talking about and have some hope of predicting the future (e.g.the decline of Cantarell). We can certainly put some upper bounds on oil production.
On the other hand, oil consumption falls into the realm of economics and politics, an entirely human activity outside of physics and engineering. It is precisely here where Taleb cries out for caution. In the realm of politics and economics literally anything is possible. For example, if the straits of Hormuz were closed for a year global consumption would go way, way, waaayyyy down. So it is here that we have to reign in our hubris. We can put upper bounds (max production) and lower bounds (zero) on oil consumption but we cannot accurately assign probabilities to various outcomes. We simply don't know what the distribution of possible outcomes is.
This is why I don't see much purpose in guessing near term oil price movements. The price is dependent upon so many factors that there is no possible way we can gather enough information to make even mildly accurate predictions. All we can do is estimate the impact of ups or downs in the price and position ourselves to benefit -- or at least not be wiped out by -- unanticpated results. Could the price of oil go up by $100 in two weeks time? Yes under possible but unlikely circumstances. Could it go down by $100 in two weeks time? Given that it's below $100 right now, no, this is not physically possible.
So this is what attracts me to this field right now:
Taleb encourages us to be Skeptical Empiricists and rely more on data and less on stories. I think this mode of thinking would encompass most of the readership here. The stories he is talking about could be either prose or mathematical frameworks. Their similarity is that they purport to explain what has happened and be relevant in predicting the future. In the realm of geology this is probably OK but in the realm of economics and politics it is decidedly not.
And Taleb's argument against the Narrative Fallacy is why the Energy Export Databrowser offers the data and graphics with a minimum of interpretation. Yes, we need to tell stories to make things simpler to understand. But we need to look at the data first.
For a condensed version of Taleb's theories aimed at a sophisticated audience please have a look at this recent article he wrote for Edge.
Happy Exploring for positive Black Sawns.
-- Jon
Not being all that sophisticated myself...would I be more or less correct in boiling down Taleb's thesis in the old adage...there are lies, damn lies...and then there are statistics?
Figures don't lie, but liars figure.
We have to be careful here. I read the Edge paper, and having co-written a textbook on risk myself, I consider oil depletion analysts "good" quantitative analysis players in the Taleb universe. I use to live in the engineering risk world and Taleb in the financial risk world, so have not really crossed path with his viewpoints, but I can pick up most of his jargon readily.
The "bad" players according to Taleb would be oil cornucopians like Michael Lynch and Peter Huber. These are the people that are living in the Fourth Quadrant, basing their predictions on current rates of growth and positive feedback. Wrong decisions made here lead to arbitrary outcomes.
Everyone seems to think the Black Swan events have to do with finding huge new deposits of oil (what Jon is calling positive Black Swan events), but I think the other ones based on bad cornucopian advice are even worse (the negative Black Swan events?).
Sorry, I didn't mean to aim that at Taleb. Just quoting an old Texas-ism about statistics. In fact if not for Hubbert's statistics, and their now-predictive power, I would not have hung around TOD.
So, Apologies.
Did Taleb address his concerns with regard to oil specifically?
He might be right conceptually but unless he picked out something specifically about oil depletion and applied the "narrative check", I won't jump to any conclusions.
The reason I say this is because a first-principles model for oil depletion has not yet been accepted. There are plenty of heuristics and empirical curve fitting to data but that does not take the form of a "narrative". So basically, we have completely contradicted his point, because he cannot blame a narrative for any snafus, since there aren't any. Everything is data so far. Where are the aspects of the Fourth Quadrant that he claims is needed ? I don't see any positive feedback being introduced and if it is, we have a diminishing return system on our hands.
I will stand corrected if Taleb wants to take a shot at the Dispersive Discovery and Oil Shock model. This is basically the only first-principles model out there that we can test, and it constitutes a complete narrative story. It also exists in his favaorable "First Quadrant", so it should be safe enough for his tastes. It consists of (1)Simple decisions: "you either find oil or not", and (2) Simple probability structures: "Markovian rules rule". Black swan discoveries are ruled out in the same way that we don't see aerosol particles the size of snowballs, or hailstones the size of boulders (both lognormal PDF's).
But then again, I doubt he will go for this angle because who are we but a bunch of amateurs on a blog...
No, Taleb does not mention oil anywhere in his book. I'm just newly excited about his ideas and my comments above are mostly directed at oil consumption and price prognosticators.
The Dispersive Discovery and Oil Shock models, now that I've had a closer look at them, are not models that I would take issue with. As you say, here things are safely in the "First Quadrant".
The skeptical empiricist in me does take issue with the naive application of Hubbert Linearization, however. The data production time series I've played with so far -- OPEC data for OPEC nations, BP 2008 for UK and Norway where there is a complete time series -- show that the HL technique is highly sensitive to the chosen input points and has enormous error bars if you are trying to use it to predict something decision makers want to know like "annual production in 2012".
At some point I hope to set up another R based on-line tool to allow individuals to pick their own points and do their own HL line fitting, complete with either confidence or tolerance intervals around the line fit.
There's nothing like poking around a real dataset to get a sense of how robust different models actually are.
True, how true. Taleb has good things to say and we as oil depletion analysts are nowhere near perfect.
Hubbert Linearization at the moment is still a heuristic and we only use it because it has fit some sets of data and appears to empirically reflect some reality.
What make me excited is that Dispersive Discovery can be used to derive the Logistic, and therefore HL, from first principles. What this now allows us to do is actually understand what is going on in the underlying math and statistics and then create some better confidence limits than a pure heuristic allows. As a good rule of thumb, a heuristic's confidence levels are even worse understood than the heuristic itself, since you have no idea where the errors are coming from. With a first principle model, you know precisely where the errors originate.
After the Fall
Interesting... a couple of Drumbeats ago there was a thread on a rumor that BoA had printed "branch closed" signs, and that we were going to see a bank holiday in the near future.
There were some odd looking movements in the Hang Seng index yesterday (Fri).
I know little about finance but my intuition said "Some very big players are getting themselves into a position, probably getting ready to offload US paper"
The older I get, the more I trust my intuition.
The following is for those interested in precious metals and/or monetary issues.
As can be seen from this Oct 3 piece from Professor Nouriel Roubini, (the economist who in February predicted the ongoing systemic financial meltdown, where the whole text of the piece is here and here), the financial world in the US and Europe is at a critical juncture. The ongoing events are likely to cause a strong effect on the role gold and silver play in today's financial world as monetary metals. Which brings us to issue of the much-denounced manipulation of gold and silver prices by Central Banks and bullion banks acting on their behalf.
First, although the manipulation of the silver price has yielded good money to the dealers by systematically fleecing the brain-dead mechanical trading funds (and also by just sitting down and collecting the profits that rollover automatically provides to their short positions in the usual situation of contango), the ultimate reason for it is monetary, due to the fact that gold and silver are inseparably linked in the minds of investors like cart and horse. And to the usual objection that gold is not money, let me point out that money is defined in terms of what it does, and it serves three roles: medium of exchange, store of value, and unit of account. And the fact that gold has never ceased to perform the second role is attested by its use in central banks' reserves. Therefore, the covert manipulation of the silver price is due to its linkage to gold, and the covert manipulation of the gold price is in turn due to its monetary role (which BTW means that GATA is basically right). In essence, it has the very same objective as the gold confiscation of 1933 and the London Gold Pool of the 1960's: to dissuade the public from fleeing fiat money towards harder, non-debasable currencies.
To see why this objective was critical for the effectiveness of Keynesian macroeconomic policies, let's remember Keynes' call of 1931: "O patriotic housewives, sally out tomorrow early into the streets and go to the wonderful sales which are everywhere advertised. You will do yourselves good - for never were things so cheap, cheap beyond your dreams. Lay in a stock of household linen, of sheets and blankets to satisfy all your needs. And have the added joy that you are increasing employment...". Clearly, to convince rational housewives to not delay their purchases of discretionary items (surely they didn't need Keynes to tell them to buy the daily bread for their children), two conditions were required:
1. They should not have expectations that prices would be lower in the future. That was achieved by the central bank issuing enough fiat currency to avoid deflation and create moderate inflationary expectations instead.
2. They should not have an easy way available to flee from the fiat currency being debased into a harder currency that would keep or even increase its purchasing power. That was achieved by banning ownership of monetary gold. And while an outright ban of gold ownership was appropriate for Hitler's and Stalin's times ("if you buy gold, you go to prison"), today the dissuasion is achieved in a more elegant, subtle way ("if you buy gold, you lose money").
Another, perhaps more academic, way to see this is by looking at the well-studied subject of dollarization in Economics. Quoting from one of the papers on the subject:
"The term dollarization has been used to denote a diverse set of related phenomena. Thus, while official (or de jure) dollarization refers to the case in which the foreign currency is given (usually exclusive) legal tender status, unofficial (or de facto) dollarization is broadly used to indicate the use of a foreign currency alongside the national currency when the former is not legal tender. In turn, a distinction is usually made between two types of de facto dollarization: currency substitution (the use of the foreign currency as medium of exchange) and asset substitution (its use as store of value). This distinction is not merely rhetorical, as currency and asset substitution are phenomena of a different nature."
And one of the known features of dollarized economies is that monetary policy loses its effectiveness in increasing aggregate demand: basically the additional pesos in the pockets of citizens with no immediate consumption needs go to the purchase of additional dollars instead of discretionary goods.
Using this conceptual framework, gold/silver is to the dollar/euro what the dollar/euro was to the pesos. Then, the substitution of a fiat currency by precious metals could be called "metallization", and the aforementioned policies aimed to dissuade the public from fleeing fiat money towards harder, non-debasable currencies try to prevent the occurrence of "de facto metallization", specifically the "asset substitution" type: the voluntary use by individuals of precious metals as store of value. And as such, those policies can be viewed rightfully as instances of exchange controls.
In this context, the recent cessation of minting of silver eagles and gold eagles and buffalos by the US Mint appear as a perfect case of a disguised but effective means of instituting such exchange controls: just as governments of Third World countries enacted every possible obstacle to prevent their citizens from using foreign currency as a store of value substitute (asset substitution) for the monetary services of the domestic currency, now OECD governments try to block their citizens from doing that with gold and silver by simply denying them access to retail forms of the metals. (Of course, the wealthy have no problem buying 1000-ounce bars, just as the well-connected had no problem evading exchange controls in Third World countries.) So, don't ask when exchange controls will come to the US. They are in force now.
And why is the manipulation machine working full-time now (as attested also by the metal's lease rates)? Because, as can be seen in Roubini's piece above, preventing the developing financial crisis from bringing on a second Great Depression will require the adoption of policies that imply an immediate and subtantial increase of the monetary base by OECD central banks (a process that has already started). And faced by the prospects of that expansion (probably doubling or tripling) of the monetary base, the logical reaction of people with savings can only be to flee fiat money towards harder, non-debasable currencies, as pointed out by Benn Steil, Director of International Economics at the CFR, in one of his recent papers (abridged version here).
And now the key question: if dissuading the public from fleeing fiat money was essential in 1933 for Keynesian macroeconomic policies to work and achieve the desired increase in aggregate demand, why shoudn't it be good to do the same now? And the answer is: to avoid a far greater evil: physical resources-driven societal collapse caused by unchecked consumption.
When the economy was far from the physical limits to growth, as in the 1930's and until a few years ago, the limiting factor of economic output was lack of aggregate demand, and the "socially beneficial" behavior to be encouraged was to consume. Hence Keynes' call to the patriotic housewives and the more recent call to US citizens to "go shopping". But when the economy instead is bumping against the physical limits to growth - most notably, but not exclusively - in the global extraction rate of crude oil - as it is today, the "socially beneficial" behavior is to refrain from unnecessary consumption. Which can be seen clearly by looking at a situation going on in the US today (though mostly ignored by the media): the gasoline shortages in the South. If someone in that area can choose between driving or staying at home today, which one is the "socially beneficial" behavior? Obviously refraining from the unnecessary consumption thus leaving gasoline available for people performing critical work like doctors. And that situation, not the 1930's, is the model for the times ahead. Therefore, in a resource constrained world, those patriotic housewives who don't want to buy discretionary items should be left alone, or rather applauded, and just as while on the way up to Hubbert's Peak consumption was encouraged, on the way down frugality should be. And so the reason for preventing people from fleeing fiat currencies disappears altogether. If they want to shift their savings to precious metals, good for them and for society as well.
And two final thoughts. First, the case that the world is at Peak Oil for all practical purposes will be officially settled beyond doubt on November 12, when the IEA releases the results of a study assessing the depletion status of the world's top 400 oil fields, which was announced here, here, and here.
Second, an increased role of gold and silver as monetary metals is not against the US national interest, as the US ranks first in the world for the absolute quantity and the percentage share of gold in its foreign exchange reserves, and as none of the countries that can be thought of as US competitors have either a big absolute quantity or share of gold in its reserves. And India, which has the largest world reserve of gold and silver disseminated among its population, is certainly not a US rival.
Awesome summary of the situation regarding the relationship of precious metals to the current financial crisis. I only question the following statement:
Which people have actually seen the physical reserves mentioned here and why should I trust them?
This is not a facetious question -- I'd really like to know how the above statement can be verified. Call me cynical if you like I'm not currently in the mood to trust government statements regarding assets.
-- Jon
I can comment on an aside, American gold rarely assay
at the marked karat. 14-K is rarely 14-K in America.
Ditto for 18-K or 10-K. Because.......thats right! no regulation!...I knew you all saw that comming huh? Iam serious here, most countries have laws and they regularly assay to determine its purity in jewlery or otherwise. For example, most American chain jewlery is made in Italy, but Italy knows about the non existant regulations and cheats for product sent to the USA. Brazil has regulators and makes certain the gold entering is legit as marked. Iam sorta certain its illegal to sell less then 18-K in some countries..I will try and find that proof to make sure. Buying gold jewlery at K-mart, Wallmart, Khols, Target or a kiosk at the mall shouldnt surprise anyone in America...its a sham.
ot, but I've been trippin' on this since I came across it some 18 mo. ago. ( don't recall where] What's to stop the FED from buying all the gold in the world, humor me, for say ten bucks an ounce, no matter what the going exchange rate. IE, gold at $1000/ ounce, just print up the money. Probably cost $10 to print that $1000. Gold at $2000/ ounce, it would cost the FED the same to print $1000, $2000, $3000 bills, anyone pickin' up what I'm puttin' down? I've considered asking Puplava on one of his Q-calls but the guy is such a blatant gold pumper I think it's a waste of time.
Thanks TOD and fwiw I had a Fleam "hit" 2 days ago
If they've been manipulating it as much as Puplava & co. claim, they'll have to buy it all just to cover their short positions...
'hit' at your site, American Valley
Growers ?
Can you provide a link ?
Not even close
http://www.globalfirepower.com/list_gold_reserves.asp
The figures listed as "gold reserves" at this site are actually (out of date) central bank reserves which consist of foreign currencies and other paper "wealth" in addition to gold. For Russia the current fraction held in gold is 13 billion USD or about 527 tons. The US has over 8000 tons (http://en.wikipedia.org/wiki/Official_gold_reserves). But this still doesn't answer the original question about independent verification.
I have heard a deafening chorus from the Republican Party about the overwhelming success of the Surge in Iraq. Bob Woodward in a recent interview on Bill Maher's show disclosed that the precipitous drop-off in violence in Iraq has little to do with the "surge" but is actually due to "highly secret techniques" that someday may become declassified and available to the public. Woodward did offer a "deep throat" hint that "exploding gifts baskets" would be looking in the right direction.
http://www.youtube.com/watch?v=ehVoLQ5ii30
Hmmm...What could these "secret techniques" be?
1. Competent planning.
2. The seeds of democracy sprouting flower.
3. A change of heart by the Iraqi people realizing of the wisdom of Corporate America.
4. Massive targeted assassinations.
Woodward also quoted Bush's personal assessment of Iran: "They're assholes!"
How would he know?
Hello JoeMichaels,
There was a weblinked article awhile back, where using sat-imagery and other techniques, where they proved that Sunni-Shia-other group ethnic cleansing, out-migration, and tribal re-organization into discrete areas was responsible for the decrease in violence BEFORE THE SURGE.
I am disappointed, but not surprised, that Obama/Biden don't use this finding as political leverage against Palin/McCain. Wouldn't be acceptable to TPTB to admit US policy as ignoring and/or facilitating in-country genocide. Unfortunately, I am not looking forward to when it happens here in the US.
From Memory, Financier Jay Gould's Quote, circa 1800s: "I will just pay half the country to kill the other half".
Perhaps it's a warning for me, but I have become so cynical of my own country that I can picture that happening.
Joe
Yes I agree that is a worry. If they do close the banks and then people are angry and trying to get food from the grocery stores without paying (since their money is not available), then scattered violence will take place, followed by the government calling out the national guard (which they had planned all along, of course). Maybe gas stations can't get gas because the banks aren't functioning, People are isolated at home, scared, hungry, possibly cold unless they can get heating oil. The banks not being open will cause a lot of havoc with businesses too.
The government will try to "help" with various announcements, scattered food deliveries, crowd control.
Will the situation escalate as something worse happens and the govt can yell "It's the terrorists!!"?
In the meantime the rich people at the top have been planning for this all along so they are basically fine in their guarded compounds. The wealthy people who control food companies maybe will deliver food to their friends in Washington.
This was about the surge myth. I think the Obama campaign rightly realizes that truth, which requires a bit of non-linear thinking, and would be rejected by the MSM, cannot be used to win a debate. The popularly believed (even if provavbly false) myth will win every time. Only the hated intellectual class, which is already largely inthe tank for Obama will believe the data, over a simpleminded but intuitive Republican surge theory.
Echos of Feakonomics: Abortion now, low crime rates later: Ethnic cleansing now, reduced warfare later.
Hmmm....
Cheers
Just a slight wiff of desperation in the air. John McCain serves in the US Senate, which has liberal Democrats. Does this mean that McCain shares the views of liberal Democrats?
http://www.breitbart.com/article.php?id=D93JSBFO0&show_article=1
Palin says Obama 'palling around' with terrorists
Isnt Sarah Plain pallin around with a guy who dropped bombs on women and children? Is that considered terrorism?...Whoops..sorry for that last comment there. I forgot the strategy was "Destroy the village to save it"...But what about when (Ole Bail out McCain) dropped a bomb on his own ship? They still play that tape for every navy pilot...AS WHAT NOT TO DO!. McCain doesnt bail out anymore, unless its David Letterman and he needs his nose powdered for Katie Couric, or its a debate, Or Michigan, or Wallstreet billionaires, or his wife gets hurt in an auto accident and he needs some arm candy for a political career, or its a piece of tail in Brazil he's using for the moment....or hundreds of others to numerous to mention...other then those...he doesnt bail anymore. Naw...Not like he used to anyway!, He wouldnt bail on a statement a few days ago.."The fundementals of our economy are strong" Nope...not ole Bail-out Johnny!...Prozac, Zoloft, Paxil sales are gonna shoot to the moon kids...remember you heard it on TOD first!
Hello TODers,
http://www.guardian.co.uk/world/2008/oct/05/zimbabwe.internationalaidand...
--------------------
Zimbabwe on the brink of new crisis as food runs out...millions face starvation in a catastrophe created by economic chaos and the dramatic collapse of commercial farms.
..'We are in serious trouble,' said Jabulani Gwaringa, of the Zimbabwe Farmers' Union (ZFU), which represents small-scale operators. 'There is no seed, fertiliser and crop chemicals on the market. Banks are not offering farmers any credit. In July we had produced about 25,000 metric tons of seed maize. We are down to 9,000 because farmers opted to eat their hybrid seed or sell it to millers.'
--------------------
Have you hugged your bag of NPK today?
It is not just Zimbabwe that will be facing problems. I think we have exhausted the Green Revolution and may well see a decline in productivity, i.e. an analog of peak oil. I am sure that this point has been made already by others. We have this collective problem of believing things will go on forever in status quo. Soil is a finite resource. Even if you fertilize it, millions of tons are still oxidized and blown away every year. We are seeing that the economy cannot handle even small perturbations and we will be dealing with the effects of a peak before the theoretical peak is reached.
http://afp.google.com/article/ALeqM5hcWdSreh2tNafF5YVZbb2Te-Eivg
----------------
PARIS (AFP) — The leaders of Europe's four main economic powers vowed to protect fragile banks in their fight against the global credit crisis as the biggest rescue in German financial history collapsed.
..A consortium of banks was to have led the biggest rescue in German history and its failure could wreak havoc when financial markets reopen on Monday.
Germany's Interior Minister Wolfgang Schaeuble has warned that the financial crisis could have political repercussions, noting how Adolf Hitler rose to power after the 1929 Wall Street crash.
----------------------
Hello TODers,
Possibly more evidence that farmers are running into financing/cash flow problems?
http://www.canada.com/reginaleaderpost/news/working/story.html?id=50c5ae...
-----------------
..It seems that we will see lower prices until buyers are convinced that prices have bottomed. As a result, many are concerned that both demand and price for potash (potassium carbonate) fertilizer will also fall.
Lower commodity prices over the last few weeks mean that farmers will realize fewer profits. Because of the lower crop prices, fertilizer prices are in the process of falling to match the new slowing global demand.
The fallout from the U.S. financial crisis is also impacting fertilizer sales as many farmers are unable to find financing due to the tight lending conditions. Credit is locked up right now and interest rates on loans have risen considerably.
Suppliers of fertilizer are also re-assessing the amount of risk they are now willing to accept. Many farmers are being denied financing for forward fertilizer purchases next spring.
------------------------
Obviously, if this condition continues for very long: this is no way to rebuild global grain reserves. We could see mind-boggling numbers of hungry people in a short timeframe if the topsoil starts providing poor harvest yields, or even worse, slams head-on into Liebig Minimums.
IMO, I would not try to underestimate the applied power of the various cartels [Canpotex, Belaruskali, Phosphate ChemGroup & OCP] from leveraging off the Webb-Pomerene Act [also the Canadian Competition Act, plus other countries' national legal acts] to rapidly curtail any excessive build up of I-NPK inventories. Recall the earlier weblink graphic where global potash inventories are near record lows.
Thus, more BAU, as usual, versus legislation and funding to purchase this rising I-NPK inventory, then store it in my speculative Fed Banks of I-NPK. Wild, volatile, and oscillating climate and weather conditions are bad enough: the farmers don't need wild, volatile, and oscillating I-NPK [prices and flowrates] additionally jerking them around.
http://www.hpj.com/archives/2008/oct08/oct6/Agricultureflourishingashar.cfm
----------------------
.."Everyone is kind of shaking in their boots about the price of fertilizer," he said. "And there's no way to know what kind of crop you'll have next year."
Input costs have risen so much that farmers want high lines of credit.
"They are literally pushing up what the bank can lend them," he said. "I don't see it being as big an issue with the larger, consolidated banks, but the local banks that rely heavily on agriculture, they might have more demands for credit than they can supply."
-----------------------------------------------
According to the DesMoines Register farmers are looking at commodity prices about the same as what it costs to grow a bushel of corn or soybeans. After spring flooding, replanting, and record high prices last summer; the current market is such that some farmers might not have money left over for groceries for the next 12 months.
http://www.desmoinesregister.com/article/20081004/BUSINESS/810040320/103...