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DrumBeat: January 12, 2009
Posted by Leanan on January 12, 2009 - 10:02am
A novel plan for economic stimulus
What's different now?In the 1930s, even though the U.S. economy collapsed, we still had a surplus of natural resources -- we were then the world's No. 1 producer of oil and coal.
Fast forward 80 years.
Despite the recent temporary dip in the price of gas and heating oil, it has become painfully obvious over the past few years that our energy situation has fundamentally changed. We've burnt through much of our natural resource birthright -- we import 70 percent of our energy -- and we're the largest debtor nation on earth. The Big Three automakers, near bankruptcy, have announced a 40 percent to 50 percent reduction in car sales; the Federal Transportation Department reported an 8 percent annual drop in passenger miles driven. The National Intelligence Council's "Global Trends 2025" report concluded that, in the near term, pressure on resources -- particularly energy, food, and water -- would entail sacrifices as demand outstrips supply. The Defense Department arrived at the same conclusion in its "Joint Operations Environment 2008" report. It would appear that we need to plan for a less energy-intense future.
StatoilHydro drills "disappointing" Arctic well
OSLO (Reuters) - Norwegian oil and gas group StatoilHydro (STL.OL) has drilled a "disappointing" appraisal well in the Barents Sea, the company and energy officials said on Monday.The company drilled the well at its Obesum prospect where an exploration well struck oil and gas last year.
"No oil was found in the appraisal well, and thus the size of the oil component is considered minimal," the Norwegian Petroleum Directorate said in a statement.
"Neither the oil nor the gas discovery in the shallower level is considered commercially interesting," the NPD said of the well drilled 175 kilometres (109 miles) north-northwest of the far northern Norwegian town of Hammerfest.
The automaker's plans don't include a direct competitor because Ford engineers doubt its real-world performance.
HelioVolt, Suntech Cut Employees Too As Layoffs Expand Around Solar
HelioVolt, the maker of copper indium gallium selenide (CIGS) solar cells, has joined the layoff club too.The company, which has raised over $100 million in VC funds, cut about 15 employees earlier this month, according to the Austin American Statesman. It’s not a huge number, but HelioVolt is not a massive operation either. It is just moving into production.
The layoff list is growing by the day. Last week, OptiSolar said it was cutting about 300 employees, or half of the staff. After we ran that story, a person who got laid off by SunEdison said that the solar power provider cut about 50 to 65 employees. GT Solar cut 25 jobs in December.
BP Has $20 Million of Diesel Stolen With Fake Meter
(Bloomberg) -- BP Plc, Europe’s second-largest oil company, had about $20 million worth of diesel fuel stolen over the past nine to 10 months from a distribution center in Seattle with a fake meter.BP reported the fuel had been “systematically stolen over the past nine to 10 months,” according to a Seattle Police report. The phony meter was activated by starting and then stopping the loading process, according to the report.
China's 2009 Power Output, Demand to Extend Declines
(Bloomberg) -- Power demand and output in China, the world's second-biggest consumer of energy, will continue to fall this year because of slower economic growth, said the State Electricity Regulatory Commission.Power stations will operate at reduced rates, the Beijing- based commission said in a statement posted on its Web site today. ``Unsolved problems'' in coal and power pricing will add to operational difficulties, it said.
Economic growth in China has slowed for five consecutive quarters and its 9-percent third-quarter expansion was the weakest in five years. Power consumption is declining as companies in industries from metals to toys reduce production or close down after the global recession cut demand for exports.
Senior Democrat reintroduces anti-OPEC bill
WASHINGTON (Reuters) - A senior Democratic senator reintroduced legislation on Monday that would allow the U.S. Justice Department to bring legal action against OPEC and others it believes collude to push up the price of oil.
Propping up balance sheets may be en vogue at the moment, but tapping the jittery stock market for funds is not; hence why shares of Scottish & Southern Energy sank more than 8.0% during afternoon trading in London on Wednesday, after it announced a new share placement worth estimated $680 million at current prices. Perhaps it should have followed rival E.ON's example: the German utility is turning to the bond market, not the equity market, for funds.
The agreement between Russia and Ukraine to set up independent monitors of export pipelines in Ukraine may restore gas flow to the West. But it will do nothing to settle the underlying dispute that threatens Europe and is likely to get worse.
Auto show notebook: New Prius gets 50 mpg
Toyota's redesigned 2010 Prius gasoline-electric hybrid, on sale this summer, will be rated 50 miles gallon in combined city-highway driving and more than 50 in town, the automaker said as it unveiled the Prius re-do Monday.That bests the current version's rating of 48 mpg in the city and 46 in combined city-highway driving and would make it the most fuel-efficient car sold in the U.S. by a significant margin. Honda's new Insight hybrid, Prius' closest direct competitor, is rated in the 40s. Volkswagen's Jetta diesel is in the 30s. Insight goes on sale April 22. Jetta's on sale now.
Transocean Cancels Rig Deal on Client’s Cash Shortage
(Bloomberg) -- Transocean Inc., the world’s largest offshore oil driller, canceled a record $550,000-a-day rig lease and said a second vessel has been idled after the client ran out of cash.Transocean, based in Switzerland and run from offices in Houston, disclosed the termination of its contract with Burgundy Global Exploration Corp. today in the monthly fleet-status report on its Web site. Calgary-based Oilexco Inc. halted operations aboard Transocean’s Sedco 712 rig after its North Sea subsidiary sought protection from creditors, the report said.
Oil exploration companies are having difficulty borrowing money to lease rigs and hire roughnecks after crude tumbled 74 percent in the past six months and global credit markets seized up, said Truls Olsen, an analyst at Fearnley Fonds AS in Oslo. More contract terminations are imminent as energy prices decline and cash-strapped producers reduce or cancel projects.
Climate change fears spiral as warmer seas 'absorbing less carbon dioxide'
Scientists have found evidence of a sudden and dramatic drop in the amount of carbon dioxide being absorbed by the sea, sparking fears that climate change is accelerating.Warmer waters - themselves said to be the result of the changing climate - are believed to have caused the decline.
"Predict and survive" - or not
There's an intriguing question asked in the pages of the US journal Proceedings of the National Academy of Sciences (PNAS) this week.In a nutshell, it is this: can we forecast sudden, possibly catastrophic environmental changes by monitoring long-term trends?
Pemex Closes Two Export Terminals on Weather That May Intensify
(Bloomberg) -- Petroleos Mexicanos, the third- largest supplier of crude to the U.S., closed two oil export terminals in the Gulf of Mexico because of heavy winds and rain.
Russian gas supplies to Europe likely to resume early on Tuesday
BRUSSELS (RIA Novosti) - Russian natural gas supplies to Europe, halted last Wednesday over a gas dispute with Ukraine, could resume early on Tuesday, a deputy CEO of the Russian energy giant Gazprom said Monday."Deliveries of Russian transit gas [to Europe through Ukraine] could start at 8 o'clock in the morning CET [07:00 GMT] on Tuesday," Alexander Medvedev said.
Europeans 'afraid of tomorrow'
The central heating system in Sofia is working again since Sunday. Now it's using fuel oil. This has made a slight improvement, though I am still using an electric heater as well.Today is one of the coldest days we've had lately - right now it's -10C. Fuel oil is very polluting and it instantly created a smog, that is not going away. The whole of Sofia is covered in smog, it's hard to see and difficult to breathe.
Lots of factories have switched over to fuel oil. I am an ecologist and I can tell you that there will be environmental consequences, we don't know the whole impact yet.
Fuel oil is not stored locally, so it had to be transported throughout the country and the mess it leaves behind will take years to clean.
Gas Plus’s Usberti Interested in Accord With Gazprom
Italy is seeking to diversify the sources from which it draws natural gas. Supplies to Europe came to a halt last week as Russia and Ukraine argued over the price of the fuel. A pipeline through the Ukraine brings gas from Russia to the rest of Europe. A similar dispute interrupted gas supplies in January 2006.
Sasol May Invest $10 Billion in Indonesia Fuel Deal
(Bloomberg) -- Sasol Ltd., the world’s biggest producer of motor fuels from coal, may invest $10 billion in an Indonesian plant, said a government official in Jakarta.Sasol will sign an accord with the Ministry of Energy to study the possibility of a coal-to-oil plant in Indonesia, said Bukin Daulay, head of coal and mineral research at the ministry. Indonesia was Asia’s biggest coal producer in 2007 after China, Australia and India, according to the BP Statistical Review.
AMP-Ohio picks Bechtel to build big coal plant
NEW YORK (Reuters) - American Municipal Power-Ohio Inc (AMP-Ohio) picked Bechtel Power Corp to build a $3.25 billion coal-fired power plant capable of generating about 1,000 megawatts in Meigs County in southern Ohio, the companies said in a release Friday.The companies said the station will help stabilize electric prices for the 81 municipal electric systems in Ohio, Michigan, Virginia and West Virginia that will receive power from the plant.
GE, China-based power firm enter wind power deal
A General Electric Co. subsidiary and China-based A-Power Energy Generation Systems Ltd. on Monday said they signed two letters of intent, one for a supply deal and a second for a joint venture partnership.
Oil firms may put projects on hold until costs fall
OIL companies may soon begin delaying projects in an attempt to take advantage of an expected fall in services costs, senior executives have told The Scotsman.Several executives at exploration companies have predicted that the cost of oil services – such as well drilling – could fall by as much as 50 per cent in large open markets such as the North Sea.
Since peaking near $150 a barrel in late July, crude oil prices have fallen by around two-thirds, a move that is expected to lead to a fall in exploration levels.
This in turn is likely to force oil services companies – which carry out the projects to explore for oil and bring projects into production – to drop their costs to win projects, industry figures believe.
Kurt Cobb: Will energy show us that inflation and deflation can occur at the same time?
At the beginning of this decade investment advisor Marc Faber told incredulous investors that rising economic prosperity in Asia signalled the beginning of a new bull market in commodities, but would also have deflationary consequences for consumer prices. How could these inflationary and deflationary effects coincide? The answer has important implications for what is currently unfolding in the financial and commodity markets, and, in particular, the energy markets.
Stirrings in the Central Asian republics of 'Troublistans'
The “stans” of Central Asia are stirring in ferment and revolt. For the rest of the world, the five repubics — Kyrgyzstan, Tajikistan, Uzbekistan, Turkmenistan and Kazakhstan — are important only because like the oil producing countries of the Middle East, they sit atop vast reserves of oil and gas that the West covets. Their other function appears to be to prevent Russia and China getting their hands on these riches, all as part of the West’s, especially the US’s geo-strategic plan to keep these two countries from surging ahead. Thus, their energy resources and their strategic positions are all that the West cares about. What happens to their hapless people is quite irrelevant.
'At least 30 African countries suffer from the energy crisis'
Tripoli, Libya - At least 30 countries in sub-Saharan Africa suffer from the energy crisis in which arose in the past few years, according to the 2008 statistics of the International Monetary Funds (the IMF), quoted by the UN electronic review 'Africa Renewal'. According to the statistics, 550 million Africans, representing 75 percent of the population of the continent, do not have access to electricity.
Mexico's Pemex Awards Contracts For Work On Cantarell Fields
MEXICO CITY -(Dow Jones)- Mexican state oil monopoly Petroleos Mexicanos said Sunday it awarded four contracts for well-recovery rigs and related services as part of its efforts to contain the decline in production at the offshore Cantarell oilfields.Pemex said in a press release that work on the contracts, which are for a combined $150 million, is expected to be completed in about eight months.
Richard Heinberg: Opportunity for FUNDAMENTAL change
An article by Neil Reynolds in Friday's GLOBE AND MAIL, titled "Obama's energy quick fix bound for the slag heap," quotes University of Manitoba Professor Vaclav Smil to support its thesis.
Julian Cope: 'It's time for war'"There has to be more eco-terrorism," he tells me in the well-spoken diction of his distinctive baritone, an occasional lilt suggesting his Staffordshire roots. "People's lives have to be disrupted to get them to slow down. We haven't hit peak oil yet, but it's very close. We've gotta stop flying cos it's just so gratuitous. What we should be doing is getting used to the guarantees falling, like not having guaranteed pensions any more."
Kuwait Plans Oil, Gas Output Boost From New Deposits(Bloomberg) -- Kuwait aims to boost production of crude oil and natural gas at deposits it’s developing as the Persian Gulf country seeks to bring new resources to the market, an official at state-run Kuwait Petroleum Corp. said.Kuwait Oil Co., a unit of Kuwait Petroleum, is starting a heavy-crude pilot project in the northern part of the country to produce 50,000 barrels a day by 2015, Mohammad Hussain, the company’s deputy chairman for planning and gas, said at a conference in Dubai yesterday. Output will rise to 400,000 barrels a day as the project’s scope is increased after 2020.
Crude Oil Falls Below $40 as Demand Drops Faster Than Supply(Bloomberg) -- Crude oil fell below $40 in New York on concern production cuts by the Organization of Petroleum Exporting Countries will fail to counter a slump in demand.Oil consumption will fall by 1 million barrels a day this year as the U.S., Europe and Japan face their first simultaneous recessions since the Second World War, Deutsche Bank AG predicted last week. U.S. stockpiles have climbed in 13 of the past 15 weeks, according to the Energy Department. OPEC members signaled last week they will curb sales to refiners in February.
Cost of gas rises for first time in six monthsCAMARILLO, Calif. - The average national price of gasoline rose nearly 12 cents in the past three weeks, marking the first price hike after six months of steady decreases, according to a national survey released Sunday.
Gazprom: Ukraine signs gas monitoring dealKIEV, Ukraine – Ukraine signed a deal Monday to allow independent monitors to track natural gas shipments from Russia. It did not insist on its previous conditions, opening the way for a resumption of gas supplies to Europe.
Nuclear fears as danger plant is reopened in gas war with RussiaFears were raised yesterday over a decision to restart a potentially dangerous decommissioned nuclear power plant in the centre of Europe because of a shortage of gas caused by Russia’s dispute with Ukraine.Slovakia, defying undertakings given when it joined the European Union, said that it would reactivate a Soviet-style nuclear generator that has a record of safety problems because it had received no Russian gas since last Thursday.
EU warns Slovakia on nuclear plant restartBRUSSELS, Belgium: The European Union says it would take action against Slovakia if it restarts a Soviet-era nuclear reactor to cope with a gas shortage caused by the dispute between Ukraine and Russia.
Russia rouble devalued again, gas row adds pressureMOSCOW (Reuters) - Russia let the rouble's value fall on Monday for the second time this year as weak oil prices, the gas row with Ukraine and the prospects of an economic recession kept downward pressure on the currency.The move, the 14th mini-devaluation in around two months and the second in as many days, keeps up the pace of late December, when the rouble weakened on six of the last 10 trading days.
Brazil’s Real Weakens Versus Dollar as Oil Drops Below $40(Bloomberg) -- Brazil’s real fell as crude oil, one of the country’s top three exports, dropped below $40 a barrel.
Venezuela Begins Stealth Devaluation After Oil Price Plunge(Bloomberg) -- Venezuelan President Hugo Chavez says he won’t adjust the oil-exporting country’s pegged exchange rate amid a plunge in prices for crude. Instead, seeking to maintain his popularity, he may devalue the currency by sleight of hand.The government is already cutting its sales of dollars at the rate it established in 2005, forcing travelers abroad to turn to a parallel, unofficial market where U.S. currency sells at a 61 percent premium. Venezuelans need government authorization to get dollars at the official rate.
“What’s essentially going on is a surreptitious devaluation,” said Russell Dallen, head trader at Caracas Capital Markets, a unit of BBO Financial Services Inc., a Caracas-based brokerage and asset management company. “They’re pushing more people into the unofficial market, so that’s forcing a devaluation on more people.”
JAKARTA (Xinhua) -- Indonesian President Susilo Bambang Yudhoyono announced subsidized-oil prices cuts on Monday to boost purchasing power.The move was Indonesia's latest effort to cushion the deepening fallout of the global recession, following the fall of global oil price up to over 40 U.S. dollars per barrel after reaching record of 147 U.S. dollars a barrel in July.
Kuwait Appoints Sheikh Mohammed Sabah As Acting Oil Minister(Bloomberg) -- Kuwait appointed Mohammad Sabah Al-Salem Al-Sabah its acting oil minister as the third-largest OPEC producer formed its fifth cabinet since 2006 after opposition lawmakers forced the previous government to resign.
Fossil fuels will supply a third of energy till 2030: PachauriNew Delhi: Painting a gloomy picture of adverse climate change affecting countries across the globe, a leading energy expert has said that more than one-third of world energy demand would continue to be met by fossil fuels like coal till 2030.“World energy demand would increase by 45 percent between now and 2030. More than one-third of this would be met by coal, sending global temperatures soaring,” director general of The Energy and Resources Institute, R.K. Pachauri said here Monday.
Indian Bonds Advance Most Since 2001 as Fuel Prices May Be Cut(Bloomberg) -- Indian bonds rose the most since September 2001 on speculation the government will cut gasoline and diesel prices, helping ease inflation further from a 10- month low.
Toyota shock hits Japan's auto regionNAGOYA, Japan (Reuters) - Toyota shock has hit Japan's car manufacturing district, leaving factories and small businesses reeling as orders dry up due to a global recession that has put the brakes on car sales worldwide.Toyota is firing thousands of contract workers, causing a rise in the number of jobless and homeless. The greater Nagoya economy is being hit hard with business slowing at shopping malls and taxi drivers complaining that customers are scarce.
Honda to launch Insight hybrid in Japan in FebruaryDETROIT (Reuters) – Honda Motor Co will begin selling the Insight, the first of its next generation low-cost hybrid cars, in Japan in February, followed by launches in Europe and the United States in March and April.The dedicated hybrid model, a production version of which made its debut at the North American International Auto Show in Detroit on Sunday, has listed mileage of 40 miles per gallon in city driving and 43 mpg on the highway in the United States.
But Yasunari Seki, the Insight's chief engineer, said it has proven potential of as much as 72 mpg, or about 30 km/liter, aided by an "eco-lamp" color meter that goes from shades of blue to green to prompt fuel-efficient driving.
48 mpg is nice, but hybrids don't add up right nowPaying thousands of extra dollars for a hybrid car when gas topped $4 a gallon wasn't unreasonable because with enough driving, it only took a few years to recoup the added cost. But with the economy mired in a recession and fuel prices at their lowest in six years, pinched consumers seem less willing to fork over the extra thousands of dollars for a car that coaxes just a few extra miles out of a gallon of gas.At this point, buying a hybrid makes as much economic sense as buying a gas-guzzling SUV did last summer.
"Green" billboard ready to light up Times SquareNEW YORK (Reuters) – The world's first billboard running solely on wind and solar power is ready to make its debut in the capital of all billboards -- New York's Times Square.Wind whistling between the neighborhood's skyscrapers should keep the giant billboard lit constantly, said the manufacturer, Japanese copy and photo giant Ricoh Company Ltd.
Great wealth of Afghan elite sows bitterness: In one of the world's poorest nations, a myriad tales of official corruption"I am a farmer with 11 children. Our crops dried up, so I came to the city to find work, but all day I stand here in the cold and no one hires me," said Abdul Ghani, 47. "All the jobs and money go to those who have relatives in power, and corruption is everywhere. How else could they build these big houses? Nobody cares about the poor," he added bitterly. "They just make fun of us."Seven years after the fall of the Taliban and the establishment of a civilian-led, internationally backed government, Afghanistan remains one of the poorest countries in the world, with rates of unemployment, illiteracy, infant mortality and malnutrition on a par with the most impoverished nations in sub-Saharan Africa. Most homes lack light, heat and running water; most babies are born at home and without medical help.
Now, according to U.N. figures, the populace is getting even poorer. A combination of drought, soaring food prices, scarce jobs and meager wages has meant that about 5 million Afghans -- far more than in any recent year -- are slated to receive emergency food aid. Many families spend up to 80 percent of their income on food.
Unrest brewing in rural China over land disputesJILIN, China — As political slogans go, "Peasants are also citizens" doesn't sound very threatening. Yet it may have been enough to trigger a crackdown Sunday by Chinese police eager to prevent another outbreak of unrest in rural China.About 200 Chinese villagers had gathered Sunday to press the government for more adequate compensation for farmland they say was unfairly expropriated from them more than a decade ago.
NYT reporter warns of one-term Obama“You’re not going to see universal health care, I don’t think, this year,” Baker said. “You’re not going to see a cap on carbon emissions, as he has promised, probably, this year.”And for all of his campaign trail talk about collective sacrifice, Baker observed, Obama has seemed reluctant to call for austerity in a challenging economic moment.
“He hasn’t asked anybody for sacrifice,” Baker said. “His whole economic package is about giving things to people.”
Oil execs see growth in renewable energyWASHINGTON – Many oil and gas company executives are predicting a significant ramp-up of renewable energy use over the next five years to run cars and trucks and generate electricity, according to a new survey.A survey of chief financial officers of 100 U.S. oil and gas exploration and production companies found that nearly nine of 10 executives predicted renewable energy to gain a larger share of the market in the next five years with better than 1 in 5 executives expecting the share to more than double.
Georgia, Russia in talks over hydropower plantTBILISI (Reuters) - Georgia said on Monday it was in talks with Russian electricity trader Inter RAO over joint control of the vital Enguri hydroelectric power plant, which straddles Georgia's de facto border with breakaway Abkhazia."We are in talks to create a council with equal representation, which will manage the operation of the Enguri plant," Georgian Energy Minister Alezander Khetaguri told reporters.
While the 111th Congress and the Obama administration work on the details of the federal stimulus package, we have to make certain that we are looking for nongovernment mechanisms to stimulate the American economy.One large target for preserving American cash is the huge amount of money we are sending overseas to buy oil. If OPEC is successful in reaching its target price per barrel in 2009, reported to be about $75 per barrel, the United States will spend about $350 billion on foreign oil. That number will be repeated - if not exceeded - year-after-year until we do something to reduce our dependence on imported oil.
Carbon Tax: The Lesser Of Two EvilsClimate Change: Exxon Mobil CEO Rex Tillerson, long reviled by environmentalists for his skepticism of extreme global warming claims, now supports a tax on C02 emissions. A new convert to the cause? We doubt it.
Two Google searches 'produce same CO2 as boiling kettle'Using Google to conduct two web searches produces the same amount of carbon emissions as boiling a kettle, says a US physicist.Resarch by Alex Wissner-Gross, who is also a Harvard University academic, revealed that using a PC to conduct one Google search generates 7g of carbon dioxide and two searches is equal to the 14g of carbon dioxide produced when boiling a kettle with enough water for one cup of tea. With two million internet searches taking place every day, the carbon emissions are beginning to mount up.
Google emits rebuttal to carbon claimsReacting swiftly to a Harvard academic's claims that two Google searches produce as much greenhouse gas as boiling a kettle, the company has posted a blog on the subject."We thought it would be helpful to explain why this number is *many* times too high," the post states. "...A Google search uses just about the same amount of energy that your body burns in ten seconds... The average car driven for one kilometer produces as many greenhouse gases as a thousand Google searches."
Climate will hit indigenous Australians hardest: reportINDIGENOUS Australians in remote areas will be hardest hit by climate change because of their poorer health and access to services, a team of environment and indigenous health experts has warned.And the documented link between the health of traditional Aborigines and the health of their ancestral country could make them more vulnerable to the effects of climate change.
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On Thursday, I'm scheduled to conduct the first of two on-air interviews with William Halal, author of Technology's Promise. I'm looking for help from the TOD community in identifying anything unusual in the background of his collaborators.
The book is a techno-optimist view of the future, based on a Delphi method of compiling expert forecasts. See http://www.washingtonpost.com/wp-srv/opinions/outlook/nextthings/ for an illustrated, full-page description of the world according to Halal and his expert panel (including space tourism in 2012 +/- 2 years; the book approvingly cites a NASA vision of a space hotel in two decades).
The list of experts consulted for the book includes Fred Singer, whose work twisting science as a climate change denialist has been widely debunked. He's been removed from the current list of experts at Halal's web site, http://www.techcast.org/Expert.aspx
In the current cast of experts, I see no petroleum geologists, and very thin background in energy and environmetal questions. A search of the experts' resumes includes no mention of food or farming, and only one mention of agriculture.
What other questions would you ask about the experts' backgrounds? Is there anyone with a reputation similar to Fred Singer's on the current panel?
Thanks!
I dont quite understand the purpose of the organiszation... strange. What do they want?
Just a thought: they say "and analyses of these results show that the variation among forecasts averages +/- 3 years, with standard deviations averaging 4.3 years."
Does this include a) only technologies that have become real - for example: if they have guessed that a technology should arrive,
but it havent yet, how do they take that into account for the "success rate"?
b) is the statistics based on the first (earliest) prognosis they made OR on the most recent iterated updated prognosis, just before the technology became real?
I suppose one can fiddle quite a bit with the dates and rather broad descriptions they use...:)
Cheers
Hi Carl;
I didn't recognize any of that Tech-cast in terms of your question.. it just brings to mind a thought on their project (and TOD's, consequently) ..
(my emphasis)rf
They describe the great, globewide communications in the internet that have made the collections of like minds (or any other collection you'd choose) possible and fairly easy. This can and has resulted in some great focused efforts, but has also created some massive Echo Chambers, which assemble with a common ideological bent, and don't have to include some kind of Check and Balance. Maybe they do, maybe not, but this is one of the challenges of a certain part of the scientific method, which separates the area of study from all else and holds it isolated from the interferences and impurities of the big world. Reintegrating the learning into the messy mix of life can challenge the clarity of results that grew so easily in a vaccuum.
Specialization and the Culture Dish have made possible some wonderful advancements, but have also celebrated a form of segregation that can also carry its own blinders and toxicity.
"The Specialist learns more and more about less and less until he finally knows Everything about Nothing. (and the Generalist scans Less and Less about more and more, finally knowing nothing about Everything.)"
For what it's worth, I feel that the spectrum of views at TOD swings across techological and sociological spectra enough to allow a reader to get some sense of a reasonable middleground, amidst the muddle.
Bob
About computer power a saw a programme which outlined how the Apollo moon landings were made on a computing shoestring. All those consoles had the computing power of a mobile phone. They were connected to a mainframe that had the power of a laptop. Amazing.
For more historical perspective check out the SAGE building, as I knew, it when 'taking Dad to work'.
At least one of these buildings still exist, at Minot AFB, ND. The computers are long gone, and even the original HVAC designed to cool the 2 x 3MW computers has finally been replaced by a modern HVAC system suitable for the human occupants in their many offices. No windows, and impressively thick walls and floors.
Hmmm, never thought to search for still standing buildings. The few times I've searched with various text strings the returns have included archival info, mostly from museum sources.
After a quick run thru of the list of experts, I notice there's a heavy concentration of aerospace and computer folks. As a one time satellite systems engineer who has used computers for more than 40 years, I'm sure that there is much optimism in this crowd which is not based on a real, hands on understanding of the limits of technology. I once had such optimism, thinking that the world was as easy to change as the code of a computer program (Ha!).
As you mention, there are almost no people in the list who claim to be experts in biology or ecology, which is not unusual in the technology world. My engineering education had no requirement for biology course work and at the time ecology was a nearly unknown field. Many people who have spent their entire lives in cities really don't have a clue about the connections between the natural environment and their own lives, thus their perspective is limited to extrapolating past trends to an ever brighter future of cornucopian growth. One such example is the notion of space tourism, which will always require massive amounts of energy even for short hops above 50 miles. From an energy perspective, today's reality is that there simply isn't going to be enough energy available for more than a few people to experience space flight. The billions of us left behind on the surface will find it increasingly difficult just to stay warm in winter and finding enough work to pay for it.
It's a good thing that Fred Singer is no longer on the list, having had some direct experience with Dr. Singer and his fellow travelers. However, Singer is just one of many who appear to think that mankind can ignore climate change and the environment in general. They have been proven wrong so many times that it's hard to keep up with the count, yet, they still find a voice with funding from large corporations which do not want to give up their destructive ways. Once Peak Oil is obvious to all, things are going to change radically because there's no easy solution to the energy problem.
For comparison with those on the list, consider what Amory Lovins has been able to do for more than 30 years. His Hyper Car concept was to be a great technological leap, but they are not aircraft or spacecraft and they still do not exist...
E. Swanson
.. well I had to go take a peek at that HyperCar.
Here's a video describing some of the developments that went into the Hyper-car.
Be Warned, the style of the video is practically dripping with Cornucopianism.. Very Snazzy, with HiTeck Music and Too-cool cutting.. but I still think a lot of the notions that are in play here can be useful for whatever it is we are pushing around on wheels.
http://www.autobloggreen.com/2007/09/04/video-rmis-hypercar-a-100-mpg-su...
While definitely a business-lovin'-futurist, (and not unlike William McDonough, I'd say) I think Lovins has been doing some very useful design work.
-- Who was that McLovin' character in SUPERBAD?
And where's Cherenkov when you need him?
Thanks for your input
Segeltamp, they are providing corporate clients (in particular) with an overview of upcoming trends in different areas. I'm not sure what their business model is; probably they sell reports with more detail than what's on their web site or in Halal's book, Technology's Promise.
Yes, they're trying to reduce uncertainty from 100% to 10-20%, they say. The book contains less broad descriptions.
Well put, Bob; I'll try crafting a question around that.
E.Swanson, this is probably where technological possibility collides with market economics. I think Lovins believes that the technology for the Hypercar exists. With the expert panel's apparent blinders to energy constraints (they're aware of climate change), I'm not sure they would have predicted a breakthrough for the Hypercar. But now I'm putting words in my interviewee's mouth.. This would be another fruitful line of questioning.
Don't ask a miner if we need less coal
Don't ask a vehicle manufacturer if we need less cars
Don't ask a plastic surgeon if we need less face lifts
Don't ask a general if we need less arms
Don't ask a corn farmer if we need less ethanol
Don't ask a fund manager if we should liquidate our investments
Don't ask a stockbroker if he knows what he is doing
Don't ask a banker if her bank is safe
Don't ask a politician anything if you really need to be told the truth
The point being............IMO to be able to fully appreciate their point of view. We really should know and understand who, whom or what people are dependent on for their livelihood.
PS not the same as asking a new mother if there should be less babies.
The hyper car concept is an extreme example of the current hybrids. Consider the story linked above, 48 mpg is nice, but hybrids don't add up right now. The improvement in MPG may seem large, but the savings do not justify the added cost of the technology unless the cost of fuel is very much greater than that today. Lovins has apparently added plug in capability to his concept, which just shifts the burden to electricity from the grid, which will also be needed by other users as the fossil fuels are exhausted. Our economic system philosophy does not address problems from energy shortages, given that there's the assumption that shortage in one sector will be met by growth in another. But, energy is the foundation commodity, the fuel which is the basis of all other commodities produced and traded thru the economy. As fossil fuel shortages appear and the prices of those basic commodities increase, all other prices downstream can be expected to increase as well. I think we will find that our market economics will not function well after Peak Oil as cheap energy can no longer be expected to be available into the future.
E. Swanson
Beware the MPG illusion. Assuming 1200 miles driven a month, going from 50 mpg to 100 mpg saves only half as much as going from 25 mpg to 50 mpg.
True, but I'd still like for people like this to get consideration along with Ford, GM and Chrystler wrt the auto bailout. I don't like the Auto bailout in general, but if you're going to do it, why not give this guy $200 Million and see what he can come up with.
With OPEC cutting fuel production, the world may need less cars as there might be less fuel available, same thing with jets, trains, etc. Why not just shut down inefficient auto plants rather than push the U.S. closer towards bankruptcy by trying to keep open what is not affordable.
Rain:
There is a lot of doublespeak going on wrt the auto bailout. There are doom and gloom predictions regarding job losses if GM and Chrysler go under (parts suppliers, other manufacturers, yada, yada), but they ignore certain fundamentals.
In rough numbers, the system has the capacity to make 16 mil. cars per year and it is possible that actual sales at the end of 2009 will be half of that. This means that 50% of the system going to be out of work, regardless of who goes under.
If GM goes under, and I think it should, there will be many other plants to take up the slack. In the doom and gloom, it is somehow implied that if GM goes, that those cars won't be built and sold, which is nonsense.
The whole premise of the bailout is BAU after the big 3 get by this little rough patch. BAU, of course, is what got them in this hole in the first place.
A bailout IMO, just allows the dead wood to scale back evenly (and dratically) across the board while the US gummint takes on more unsustainable debt with little net benefit.
Doesn't make much sense to me either. We should just let Darwin do his job.
Naturally Darwin wasn't referred to when the first 8 trillion was being transferred and added to taxpayer liabilities.
Just to be clear, I'm not in favour of any bailout unless there is an endgame with a net benefit.
Be it auto manufacturers or Ponzi banks, you can not sustain the unsustainable.
My only question is; Was softening the crash worth 8+ trillion?
It is worth it if you get a slice of the pie (that is the way your fearless leaders look at it).
Brian T - Wow! With $8 trillion added to "taxpayer" liabilities, who is having their taxes raised? Who is Obama raising taxes on? Have your taxes gone up exponetially? Do you expect them to increase? It is one thing to have a liability. It is totally different to have to pay it. And do not claim that it will be your great grandchildren.
"do not claim that it will be your great grandchildren."
Why on earth not? In the end there isn't any thin air to make this stuff out of. One way or another some future generation will pay. And strong inflation is as much of a tax - a capricious and arbitrary one at that - as any other.
Well, if you accept the arguments put forth by Reagan supporters, we can pay off that debt by cutting taxes even more. Wanna try it and see?
In the real world, not the one inhabited by Bushes and Reagans, governments have to pay their debts. The whole tax cut increases government revenues thing was started by increased collections from social security and medicare after the economy started to rebound not too long after Reagan took office. Since those collections are included in the general fund revenues of the US government, it looked like the whole "cut taxes to increase revenues" thing would work. But, as it turns out, it was smoke, mirrors and fraud. They got away with it, too, and if we have out of control inflation again, it may bail itself out again, but I doubt it.
who-hooo! All righty then, let's just 'print' as much money as we want, and everyone will be rich! McMansions and Escalades and 100-inch LCD TVs in every room! Genius!
Leanan,
It's not the savings that are relevant it's consumption; a 100 mg vehicle consumers 12gallons, half as much as a 50 mpg vehicle hence the resource will last twice as long(more than that because there will be some resource additions).
No way out for Ukraine
The gas flow will resume to Europe, but no gas for Ukraine until a price is reached.
So much for NATO in the Ukraine.
Gazprom said the deal secured at the weekend would have to be signed again.
Russia has said it will turn the taps on only when the gas monitoring deal is signed by all sides and monitors are deployed.
Gazprom and Ukraine have said it will take at least 36 hours before gas reaches EU borders after flows resume, which means most countries will not get Russian gas before Wednesday.
It was signed again this morning.
by Ukraine with a gun to it's head.
Hmm. I'm informed, though I can't recall where from, that Ukraine has had a very long standing debt to Russia, which has not had payments made upon it and which has not increased, despite continuing gas use by Ukraine.
Of course I might be spreading disinfo here, but I'd be interested to know if anyone else has come accross this also.
Nope. You're correct.
Since dissolution of the USSR.
And the Ukraine is reneging again. today. now.
“The door is closed as before,” Medvedev said. “We did not close the door. We are doing our utmost to resume flows to our customers. Unfortunately we can’t transit gas physically through Ukraine.”
http://www.bloomberg.com/apps/news?pid=20601087&sid=ag0FOQfRg2L0&refer=home
The fault line widens.
Under the radar of the MSM, China is quietly on a path to becoming the world's largest domestic market for auto and truck sales by 2011 (if current trends hold). It appears that China has no intention of letting sales slip (taxes and restrictions are being scaled back).
I don't think current trends are going to hold.
China is being hit pretty hard by the economic crisis. I know many are expecting them to become the new world power, but I don't see that happening. They don't have the resources.
Yes. 750 million living on 2 dollars a day surging toward
the city lights and being turned around on dime.
Not pretty.
60 Minutes on Oil: Did Anyone Verify Anything?
60 Minutes has always been one of my favorite shows. But I must agree with this writer, this was very shoddy work.
Watch it here :The Price of Oil
Ron Patterson
There are better data analysts than I, but I watched it with semi initiated people and it came across as plausible, but was obliviously disingenuous. The show never presented any alternative scenario like the "speculators" knew the oil could not supply the amount of oil required to keep the world wide economy growing at the current rate and when the economy went bust then oil went down. The markets were working.
In addition this statement
(emphasis mine)
Sixty Minutes never explains how Morgan Stanly, with its capacity to store one day of American Supply, could manipulate the market with this infinitesimal amount of oil.
Iron Triangle at its worst with no call out, it would seem.
"Iron Triangle at its worst with no call out, it would seem."
I've been following this since 2004 and largely keeping my mouth shut. I now conclude the following:
The peak oil cause is dead.
You've been kicked into the corner, and now you're being ignored, and there is nothing you can do about it.
This is not a comment on the strength/weakness of your arguments -- which don't matter to the political/media complex -- but on your status as a "movement."
Face it. It's over.
And during the backside of the curve, as oil production plunges steeply due to lack of investment because of the credit catastrophe now hammering us, that's all you'll hear as shortages develop and people begin dying:
"But there was a lack of investment! If only we hadn't had a crash and investors hadn't left the market, oil production wouldn't be declining!"
No Peak;
Thanks for the guidance, but I'm not here for the 'cause'. I'm here for the repercussions, as in, to anticipate them, and try to exchange some ideas on where to go with it. You noticing any repercussions, or are these just above ground factors?
I don't see any signs that this is dead.
As far as oil prices and what the media, Wall Street, Washington and the public are paying attention to.. it's like they say about the weather in Maine. If you don't like it, just wait a minute..
Geology and those deep straws are marching on.
Bob
Peak Oil in only one aspect in a cluster-screw of unmanageable complexity. The problem isn't only that oil production is declining. It is also that our global society is inextricably linked to it, including all our other energy production. It is that the global population is in overshoot. It's about the mounting repercussions of overpopulation, climate change, and species extinction which we would have solved through increased energy expenditure.
Peak Oil is still as relevant as it ever was. Which is to say, one important piece of the puzzle of the collapsing system.
That is absurd! Peak oil, being a fact of geology, does not have a cause anymore than geology has a cause.
I have stated it dozens of times on this list and elsewhere, we are but observers! We observe what is happening. True, we were all shocked by the sudden collapse in oil prices, but they collapsed after oil production peaked. The very high price of oil, along with other factors, drove demand dramatically down. This caused the price of oil to collapse! Now all we can do is comment on what we are observing. Hell, that is all we ever did.
What in heavens name is over? Peak oil is over? Of course it is. Oil production has been on a plateau for almost four years. Now we are sliding off that plateau and are on the backside of peak oil. Now all we can do is observe the slide and comment on it from time to time.
That is a crock of donkey-doo. Oil production did not increase for almost four years. Sure, we had a peak, only slightly above the noise, in July of 2008, but the peak has really lasted for almost four years. We don't know what more OPEC might have produced but we can be relatively certain that in mid 2008 all OPEC nations with the possible exception of Saudi Arabia, was producing flat out. And non-OPEC nations produced in 2008 over half a million barrels per day less than their average the previous four years. Non-OPEC nations have been on a five year plateau and are now falling off that plateau.
Oil production has peaked. The collapse of oil prices along with the recession has hidden that fact. But there will not be a recovery from this recession until oil production begins to grow at the same rate it grew for the last 100 years prior to 2005, and that was slightly less than two percent per year. And that will never happen. In fact oil production will never reach its 2008 levels again. Richard Heinberg said something to the effect that the recovery will not be shaped like a V, or even a U, it will be an L. I disagree, it will be shaped like a backslash, \.
Ron Patterson
Ron,
I'm pretty sure that there was an invisible sarcanol in his posting. But as to the 60 min show last night I noticed that they drew parallels to Enron and the Cali electricity shortage without mentioning that Enron was actually able to (illegally) control the supply of power to California through diversion and artificial shutdowns. Speculators aren't able to do that, since the scale of global petroleum production is so vast.
Now for anyone here... 60 minutes made their case for price manipulation by speculators and is it not reasonable that they can cause short to midterm swings? But can anyone explain why the iron ore market seems to has similar volatility while not being part of the futures market? In Feb 08 the spot price was $196 per metric ton but by October 08 it was down to $62.
I don't think so Byron, his words, without sarcanol, fit perfectly someone with a handle like nopeak! You are correct about the iron ore market, and a lot of other commodities that are not traded on the futures market. The recession has hit virtually all commodities extremely hard. And there is no "iron cartel" to hold iron off the market and drive prices back up.
I expect oil prices to rise to near $100 a barrel this year. That will hold consumption down and keep the recession going until it turns into a full fledged depression. But I could be wrong about oil prices. If things get really bad, the price could stay low. After all, people with no money can buy nothing, no matter how cheap it gets.
Ron Patterson
"I don't think so Byron, his words, without sarcanol, fit perfectly someone with a handle like nopeak! "
"nopeak" is my first name. I made it up just to vote in a survey a few weeks ago.
My last name is "myass."
There is no "sarconol" however. I mean it when I say the peak oil "CAUSE" is dead. Not the "cause OF peak oil," but the cause of getting the idea into the mainstream, initiating mitigation strategies, etc., all are DEAD.
I'm in your camp more than you know, Ron. The 60 minutes pieces just shows how far gone the CAUSE is.
Well, There's certainly truth to that. I've been a closet peaker for years. Only when prices shot up this past year could I even get anyone to show an interest in the subject but once prices fell this past fall, it was as if the wind had never blown, that there had never been a cloudy day...
...this is a chance for the Obama team to show foresight and leadership on transition to a new paradigm for "doing business".
I will say it again, for the umpteenth time, we are but observers! Some have a cause to convince the world of peak oil. They have never had one whit of success and never will. Some believe they can help mitigate the decline of oil and help save the world. These people have visions of grandeur, they are but one voice in six point six billion and that is about the percentage of their effect.
Last year few people were remotely concerned about peak oil and fewer are concerned this year. But peak oil is here now. Actually it is in the past. Everyone expects that the economy will recover but that cannot possibly happen unless the oil supply starts growing again. That will not happen. End of story.
And I cannot believe a person with a handle like "nopeak" is anywhere near my camp.
Ron Patterson
And I will "say it again":
The name means nothing. I chose it to take part in a survey, with no intention of posting.
And you have judged everything I said on that alone!
Read my original posting again. It says, in effect: "Some have a cause to convince the world of peak oil. They have never had one whit of success and never will."
And the 60 Minutes pieces only further confirms that.
I think you're being awfully credulous to let one 60minutes piece be your Canary.
See how many hits you get from a News Search for "Peak Oil" .. Whether they accept it or not, the awareness and the conversation is alive. Simmons, Pickens et al, are not getting laughed off the stage, and the term itself is not 'single-quoted' as a wacko allegation all the time now. Since, As William Goldman said about the movie industry, and picking a successful film script, people are noticing that even with 1.65 gas... "Nobody knows anything."
http://www.montrealgazette.com/Technology/ending/1162492/story.html
Good thing the climate change people ignored people like you and kept working at it until they started to see the results (broad acceptance of climate change, the Clean Development Mechanism, carbon labels on products, etc.).
Pardon me if some of us ignore your opinion and continue to do the work necessary until we reach a tipping point.
Not to be snarky, but, I don't really see that we have made any real progress on climate change.
There have been various national and regional oil production peaks beginning years ago. Mexico peaked in oil production as did the North Sea. United States crude production peaked. Syrian crude oil production peaked. Tunisian oil production peaked etc.
With higher oil prices difficult deposits began to yield more oil such as the deep Gulf of Mexico or the Canadian tar sands. Some national production declines were reversed such as in Egypt. With lower prices we have started to see exploration & development entities consuming their cash reserves. Rig leases were canceled or cannot be performed due to insufficient funds available. Projects designed to replace existing field declines get delayed or canceled. Already developed oil wells gradually decline in production. At the same time OPEC talked alot about cutting production. At times all it took was a mention of an oil cut and prices skyrocketed. Now people do not believe oil has been cut as China has reduced refininery runs and started exporting more fuel, the U.S. storage reserves were growing rapidly. Some cuts that were annouced for January were not implemented and there were more promises for further cuts that may or may not be implemented such as from Russia. There may be oil production cuts in the works, but people have not reacted to them as they are cutting back on non-essential fuel expenditures anyway. If the prices spike again, then the U.S. might gradually replace its light passenger trucks/SUV's with lighter fuel economy models.
As the decades go by, so are oil fields drained until the production is a minor fraction of peak production. It took millions of years to form oil deposits. It is a one way trip and is burning the easy to get oil, then later maybe the hard to get heavy, deep, stranded, and unconventional oils/keragen.
rainsong - was that a non sequitor or did you reply to the wrong post?
Aangel took a thread started by Darwinian about peak oil and changed it without starting a new thread. The thread was hijacked into a message about climate change. My post was about peak oil instead of climate change. Is this not the climate change discussion blog?
Shaman - that is because climate change has nothing to do with CO2 or anything else that we humans can control. The dinasoars could not control it either.
Please articulate why you think this is the case, so as to enlighten those of us who might have a different opinion.
Come on. Everyone knows that less than 7% of the CO2 that goes into the air every year comes from human activities.
Its not the size of the fluxes, it is the net. Nature takes in and lets out quite a bit as part of the annual cycle. But her stuff cancels out. Consider the analogy of your bak account, every month a few thousand goes in, and back out again. If I were to steal your identity, and steal say $250 every month. Thats only a small fraction of your normal flows, so it doesn't matter.
It is the buildup that does matter.
But if you get your information from sites that specialize in disinformation and propaganda, you will get a distorted view of things.
jbunt, feel free to believe what you like.
Your first part, where you probably mean CO2 has nothing to do with climate change, is simply willful denial on your part.
The second part, that humans can't control it, is correct, but not for the reason you are implying. We can't control it because our ability to act is curtailed by a totalizing set of social structures.
And I'm afraid I don't know what a "dinasoar" is. Perhaps you meant dinosaurs? In which case, I'll have to defer to you're knowledge, because I know very little about raptor policy initiatives or science.
"Some have a cause to convince the world of peak oil. They have never had one whit of success and never will."
I do, and I have, and I am ramping up anticipating more success.
So humbug to you.
Dead, huh? Oh dear. Then somebody should let the City of Seattle government know, as well as the 65-town movement of Sustainable Communities ALL Over Puget Sound (SCALLOPS). And those cwazy Relocalize.net and Transition Towns folks, too. Oh, and the city of New York, too. 'Cuz everyone knows how naive and gullible those New Yorkers are...
I believe what NP meant was that Geologic Peak Oil would never be accepted by the masses or MSM as a reality. It will always be considered a result of above-ground factors.
I think the poster was agonizing over the fact that most people will never identify a declining oil production as a fact of geology. No surprise there.
Ecological catastrophe, peak oil, and economic meltdown will destroy the lives of millions of Americans in the coming years. Having neither the time nor inclination to search out the 'deeper' sources of their misery, people will do what their ancestors did in times of ecological imbalance: they will rally behind a charismatic leader who blames an outgroup.
Ancestrally, the outgroup was likely a neighboring tribe. Today, who knows? There is certainly no shortage of candidates, some deserving of blame and some not:
- The Greedy Speculators, for driving up the price of oil.
- The Greenies, for not allowing 'us' to drill, drill, drill.
- The Oil Companies, for price gouging.
- The Arabs, for hoarding 'our' oil.
- The Mexicans, for taking 'our' jobs.
- Alan Greenspan, for insane fiscal policy.
- Ben Bernake, for insane fiscal policy.
- George W. Bush, for everything.
- Barack Obama, for who knows what.
Anyone expecting some society-wide realization that exponential growth is inherently unsustainable on a finite planet is going to be disappointed. Just like nopeak.
The world oil production curve will have the same shape as the US oil production curve. Currently the world production is at about the same point as the US in 1973.
World consumption may have an up swing again (economy) but it will never equal 2005-2008.
There are still many folks that believe U S production can grow if only it weren't for this and that.
The 'this and that' is the simple need to make a profit.
IMO much of the runup in prices last year was actually caused by speculators ... er, more correctly ... gamblers.
The people taking actual legitamate delivery of the oil for actual consumption are massively in the minority in relation to the gamblers ... but it is the supply and demand and greed/fear of gamblers (that never take delivery of anything) that determines the price of the deliverable commodity - as usual the only people certain to make a profit from gambling are the market makers/casino owners.
We “Peakers” have been denied the neat production chart showing a clearly defined peak because of the economic collapse. Instead we will have only “what might have been speculation” open to interpretation to suit each persons positions.
The only thing dead is that We have been denied the ability to ever say, “We told you so”.
The only thing dead is that We have been denied the ability to ever say, “We told you so”.
I think that is what nopeak is referring to.
If the "CAUSE" is to convince others that peak oil is true, they will never understand it until it impacts them personally - i.e. gas is $20/gallon or there is no gas at the pump.
Or, there is no food in the store. I stopped being concerned about people who don't believe it.
I have plenty of preparation to do on my own. Even if we could convince everyone that it is true, most would not take any action.
If they do not believe, then they will not be prepared, and will have to depend on others who are prepared at that time.
Philosophy - All people fall into these 4 categories -
1. Early adopters - first to know and first to take action. Some actions may fail.
2. Middle adopters - check into it for quite a while, then take action based on info learned.
3. Late adopters - wait and see what everyone else has already done, then use the best actions.
4. Non adopters - Never take action and suffer the consequences.
I still believe that there will be a large number of #3 after TSHTF.
It could be another 4 years before the masses realize that peak oil is true.
It will be up to each person to make their own decisions anyway. The Gov't is not going to save us!
Sometimes the best solution or "winning play" comes late in the ball game.
In other words - let someone else spend the time, money and energy figuring out what to do, then simply take their solution and run with it. I tend to watch what others are doing first to see who is successful, and who is not.
I understand this sentiment, so what happens then when the web goes down! where do you get your information about what to do next?
Hopefully you will have amalgamated your feces long before that.
In the meantime, buy books and tools and learn, and practice, everything you can.
This is why I have built my own house with my own hands and have a wooden workbench with all the hand tools that were used by those before the advent of electricity, and know how to use and sharpen them.
Edit:
I still have a lot ot learn about growing food
The biggest thing to learn about growing food is what the people who already know how to grow food will be placing a premium value on.
Sounds like you've built up a good skill set for that.
Greg Hunter -
I distinctly recall that during the incredibly rapid run-up in oil prices in mid 2008 it was almost an article of faith here at TOD that the price of oil was dictated solely by supply/demand 'fundamentals' and that speculative investors were incapable of causing anything more than some very minor and very short-term blips in price movements.
Now it appears that this dogma has been called into serious question, as there do not appear to have been any sudden and massive changes in the supply/demand balance that can convincingly explain what happened. But one thing is beyond dispute: a vast amount of money rapidly went into the oil futures market, and then a vast amount of money fled the futures market just as rapidly. During this same period prices underwent unprecedented swings. Coincidence?
Supply/demand fundamentals are of course always at work. But the effects of speculative investment can become superimposed over those fundamentals, and if powerful enough can sometimes become a much larger influence on price. (At least in the short-term, which I would loosely define as a period of a few months.)
People have been monkeying with markets ever since there have been markets. Sometimes they're successful and more often they are not. But I think it's naive to believe that markets are solely controlled by the 'real' suppliers and 'real' users of a commodity. Particularly in this age of excessive financialization.
Absolutely incorrect! Between February and August, 2008, OECD oil demand dropped over three million barrels per day, almost seven percent! http://www.eia.doe.gov/emeu/ipsr/t17.xls At the same time OPEC was ramping up production. This decrease in demand along with increase in OPEC production caused prices to crash. Remember, the market is sluggish. It does not respond day to day but takes sometimes months for a decrease in demand to crush prices.
Sure, speculators are to blame for huge day to day swings in the market, but long term supply and demand determine the long term trend in the market. Yes, money left the futures market. But it is beyond me how some people can assume all speculative money in the market was on the long side? There was just as much short speculative momen in the market as long speculative money. A lot of long speculators made a lot of money as the price of oil was rising, but they lost it back to the short speculators as the price collapsed. But just as much short money was pulled out of the market as long money.
We must never forget the time element. Speculators cause short term swings in the market but supply and demand always determine the long term trend.
Ron Patterson
not just that, in futures trading there is a short position for every long position......
long=short
WeekendPeak
WeekendPeak -
Sure, in the futures market there is a short position for every long position. But I think the important question is: at what price are those transactions cleared and what makes that price higher or lower than it was say a month ago?
Joule,
The clearing price is the official closing price at the end of the day - at which time any difference between the trade price (or the prior day's closing price) and today's closing price has to be wired to the clearing organization who then wires it to the counterparty...
(going on a limb here): Even thoug purchases=sales, what likely matters in determining where the price is going is the number of contracts for sale/wanted at a certain price.
For example, if at a price of 100 there are 500 contracts for sale and 1000 who want to buy there is going to be upward pressure because all 500 will be sold @100 but there are still another 500 who want to buy - and they are likely to now offer 101. And ultimately that is a matter of view. if more people think the price is going up chances are it will, and vice versa. to a large extend (financial) markets are self-fulfilling. When physicals enter the market (people who can deliver/receive the actual underlying good) and make up a significant of the players (they're generally called "hedgers" whereas the pure financial players are called "speculators") high prices may plant the seeds of their own destruction by increasing supply. But as long as financial players are dominant there is no real check on how far prices can go.
Rgds
WeekendPeak
WeekendPeak -
Thanks for clarifying and amplifying that.
I know very little about the nuts and bolts of how the commodities market works, but it seems obvious to me that that more 'players' there are vigorously playing the market, the greater the potential for things to happen that are beyond the normal forces of 'real' supply and demand, i.e., the interactions between those people who actual produce the commodity and those who actually take delivery for use.
I realize that the futures market serves many useful functions ('price discovery', etc.), however, it appears to me that once the size of the speculative component gets beyond a certain point, things can become grotesque pretty fast. Some additional restrictions seem to be in order.
anyone know what this is about ?
"US Cash Crude - LLS soars as time spreads collapse"
http://www.reuters.com/article/marketsNews/idAFN1260125320090112?rpc=44
Excluding February, the average WTI futures price for 2009 is about $54. It looks like some short term refinery problems are causing inventory builds at Cushing, causing WTI to trade well below where it should relative to grades like Brent.
As Matt Simmons has pointed out, oil prices didn't just suddenly explode in 2008. Annual oil prices rose 9 out of the past 10 years. They increased at an average annual rate of almost 20%/year from 1998 to 2008--within a range from -16%/year to +45%/year. The fastest rate of increase was 2000, at +45%/year, with 2008 being the runner up, at +32%/year.
I thought that was not up to their usual standard also. There was clearly a bias in this story and no alternative views was shown. Nobody was able to explain how trading in the future market could affect the spot price without taking delivery of the oil. In addition, they missed the elephant in the room: the US entered the mother of all recessions in 2008 along with a financial storm not seen since the 30s.
Leanan/anyone: I'm looking for the link to a presentation by a woman on household income/decline of real income/2 income households since '70s?. It was posted on DB, I think, w/in last 30-45 days. Need it for a group conversation. Many thanks.
That was Elizabeth Warren, author of The Two-Income Trap. She's been talking to Congress a lot lately.
Not sure exactly which presentation you're after, but search YouTube on her name and it will probably come up.
Gripping.
http://www.motherjones.com/news/qa/2004/11/10_400.html
I ask myself about my situation... I am a single father of 2 young children (widowed). I pay more for day care (>$1000/month) than I do for my mortgage. Granted, I (well, the kids) receive $1800/month from the government in Social Security on top of my salary, I do feel the pinch. I have a new vehicle that is paid, I have no credit card debt, live in a modest home, and (except for student loans) am secure financially... But I have realized that I won't get ahead, and financially I am just treading water. I am a job loss (if it goes more than a year) away from potential bankruptcy... All the homes around me *are* bid up by the two income earners, as well as the day care costs, vehicle prices, and heck even gas.
The other part of this trap is the showering the kids with gifts because you are guilty for not being with them enough... So many people buy that big screen TV so kids can watch Nickelodeon, or get tham that Wii, or that computer, or that room so full of toys you can't walk through it... Not to mention that cell phone (later on). Yes, the kids can be an expense... In some respects, especially when they get a car and go off to college, they are like yet another adult that needs a piece of the income pie. I have started dating again, partially because I'd like someone to be at home more and cut down my day care expenses.
The author is totally right about kids being a predictor of bankruptcy... I look at my friends my age (I'm 30) and the friends who have nice homes don't have kids, and the friends who have kids live in apartments. That's just how it goes...
But yes, excellent piece. Thanks.
This article suggests that modern families will be less vulnerable, because they have two incomes:
Men losing jobs at higher rate than women in recession
Even if it's true...it seems like we have a lot of smaller families now. Single parents, single people living on their own. Loss of income would be catastrophic for them.
OTOH, many of them do have families and could move in with them. Parents, children, siblings. I suspect that will lose the stigma it carries now.
My bet is that it is probably going to take three or four adults to support a household in many cases - a couple doing informal economy work, a couple doing formal economy work.
Actually, I forsee precisely the opposite problem as the reporter along - at first, I think the double incomes will help. In the longer term, they may hurt - families dropped to living on 1/3 of their former income may be kept out of already strained safety nets, while they can't actually live on the income.
Although some of how this plays out depends on how men handle being sent home - if they actually do the childcare and informal economy work that their wives can't do, it might work - if they leave, commit suicide or sit in front of the tv (and don't get me wrong, I'm not maligning men in general here, but these are historic male responses to unemployment) rather than jump into historically female activities like cooking, saving money, mending things... then it won't work out well. My guess is that we'll see a mix, and probably the younger, more flexible and less rigorously gendered roled households will probably do best.
Sharon
The NY Times had an article about that the other day. Some men do turn into "clickers," spending all day in front of the TV. And some women are so resentful of the loss of income the marriage is threatened.
My personal experience is that older men adapt pretty well to housework. They're past the BS - more comfortable with themselves and secure in their masculinity than younger men. Though I suppose it might be different if they're unemployed.
I don't doubt some women will leave - particularly early on, when it looks like there are better options out there. My guess is that later on, that won't be as much of an option - divorce will be too expensive, there won't be a lot of men with more money out there, and statistically, while there are plenty of exceptions, the women still often end up with the kids and poverty. This is not an asset.
My observation is that depression (small d, but brought on often by the economics of big D Depression) brings out the worst in everyone - and that the difference between baby boomer men who grew up believing in equity in principle and intermittently in practice and Gen X men who were raised, say, by single or working mothers and had no choice but to do their own laundry, is pretty vast. This is, however, merely personal observation, and one of those YMMV things. Although as I understand it, the figures on household labor suggest that essentially, the younger men are, the more domestic work they already do. My sense is that the more contiguous your prior experience is with your new life, the better chance of adaptation.
Sharon
See Susan Faludi's classic works, "Stiffed" and "Backlash".
cfm in Gray, ME
Stiffed - great book and very prescient in it's analysis of the collapse of the dignity of the working man. We're gradually removing all the inefficiencies of our economy. Trouble is those 'inefficiencies' are walking, breathing human beings.
Just what is an unskilled or semi-skilled man to do in this new world ? Globalisation dictates that unless his labour is localised then he must be paid the same as the global labour pool. This isn't enough to live on in the west so he goes on welfare. Then you wonder why he is climbing through your window at 3am with a crowbar.
Great plan, assholes.
Housework? Shoot! I have 3 grandchildren still in diapers, and I'll challenge any other grandpa on the board to a diaper changing contest. (Has to be #2 to count). I think I've adapted pretty well at age 60.
Yeah but can you swaddle?
I hope more Western Dads and Moms are going to hear about Infant Potty Training.. I got to start 'forgetting' all those swabbing skills after 18mos, while some friends are still at it by age 4,5,6..
Things our culture needs to relearn..
http://www.amazon.com/Infant-Potty-Training-Primeval-Adapted/dp/1888580240
>"Infant Potty Training" is based on an elimination training technique used in much of Asia, Africa and South America. In the book, the method has been adapted to the Western lifestyle in various ways, while still maintaining a natural and gentle approach. The word "training" is used in the positive sense of a loving exchange of communication and teaching/learning between mother and baby.<
And as far as oil is concerned, that was a LOT of plastic, fiber and laundry-loads that we knocked off of our consumption.. (almost exclusively cloth diapers..)
It's a growing trend:
http://www.nytimes.com/2005/10/09/nyregion/09diapers.html
http://www.msnbc.msn.com/id/20464264/
It's probably not suitable in a family where both parents work.
I hate to insert this bit of ugliness but,
Many old folks need diaper changes as well. The arrangements we've made for our elders is really quite shocking
Well, we had 3 incomes going between us (two PT jobs and two apt. rentals in our house), but I'll admit, it wasn't easy. We do tend to do things the hard way.
That said, it's like investing in one of those 'expensive' alt energy systems that eventually pays off. We busted butt up front (so to speak) but we were out of it MUCH earlier, too.. so I'm convinced that ultimately it has been a time and money saver. The advocates also point to developmental advantages, but I won't attempt to make any such 'proud daddy claims' for the moment.
Like all tough investments, 'We can't afford to..' always precedes and undermines.. 'can we afford NOT to?'
When you think about it...this is how people toilet-train a puppy. You start out taking the puppy out when it's likely to need to go. Few people diaper their dogs.
Westcoaster, my Dad (will be 60 this summer) had full joint custody of his 3 daughters - when the parents split we were 4 mos, 6 and 7 years. That included washing the cloth diapers, and changing them ;-).
So my claim is not that older men can't adapt to shifts into the domestic sphere - just that looking at the swath of men I get to see, I see a quanitative difference in the amount of that work done between men of my generation and younger, who often grew up in households with working women (and we should all remember that after WWII, the women never did go back to the home - all four of my and my husbands grandmothers worked, so it overstates things to imply that all boomer men grew up with at-home parents) often had to do a lot more housework - and thus expect to do so - than men who grew up with an at-home Mom.
My husband and I made a deal - if I was going to nurse the babies, and thus be in charge of "input" he was in charge of "output." We're getting to the end of the diaper years, but I've *NEVER* changed a diaper when he was around to do it.
Sharon
My wife has also managed to get me stuck in the output contract.
About the only benefit is my friends are wowed by how fast I can change a diaper.
I've been looking for competitive diaper changing positions in case I lose my job.
Ive always considered the occupational terms "Chef", "Custodian", "Janitor", "Tailor" to be largely masculine gendered. Ive always thought the best tailors and chefs to be mostly male dominated, ditto janitor and custodian.
Coming from a maternal society VS a paternal, I doubt my view is biased.
I, like many men, am a tad bit nervous, having a male stretch a tailors tape, from the bottom of my pant cuff, to the under area of my crotch, so maybe I am biased after all. Its so confusing really,
Back some years ago after I retired I was doing some consultating.
After Y2k the jobs just disappeared for IT folks like me doing mainframes.
So I farmed but like possibly other men I spent huge amounts of time passing my resume around and cruising the internet for prospects. This was the only way back then....
The company I was working thru took half of my hourly rate and offered nothing back in return. So I finally decided that this was a dead end and to fulltime farming.
I was happier than pimping myself and lots healthier.
Without a fallback though the psychology of a male unable to find work is very paralyzing. It tends to eat at one. Suicide can be easily contemplated. In fact after I retired I was at a loss for a year or more. My hands didn't seem to work right. Finally I adapted and then continued on with my life,,and as I was always into some farming it was easier.
Airdale...I might add my wife was not helpful at all during this period. Nor my in-laws so I stopped communicating with them. Seems its the time when everyone wants to bash you or do some kind of mindgames.
The writer is wrong. See my post below re: the warren vid. @38th minute is the point about leveraged families despite 2 incomes.
Cheers
Gecko - I grew up with 8 siblings and Mom started working after #5 just to pay groceries and the daily 8-hour maid/baby sitter. I was #6. Forget all the toys, gadets and doo-dads - spend as much 1-on-1 time with your kids as possible. Even though we went through some rough times (financial and otherwise), the best times were the simple ones... hunting, fishing, garden, conversations at dinner table, doing chores. I learned MUCH from my dad that has served me well. And none of it had to do with what he bought me (which was damn little!) My partner even calls me RG (dad's initials) sometimes - which means alot to me.
So give your kids the gift that keeps on giving. Your affection, your time and your guidance.
All the best to you and your children.
Edgy
I most certianly do. They only get toys and gifts from me on birthdays and Christmas. I am trying to teach them not to be materialistic, and I do spend significant time with them at least twice a week. I've just seen a lot of kids being loved through gifts, and it's just sad for so many reasons...
Not to judge but is there some reason your kids receive a SS check?
Disabilities perhaps?
I got mine raised and thru college before my wife fled else I would have wondered more about payments from the government.
Raising two youngsters by one's self can surely be a daunting task.
But at least you get to raise them by your values. I didn't get that choice with mine. The price was paid nevertheless.
Best of luck with that.
Airdale
Gecko has mentioned previously that his young wife passed away from cancer, leaving him a widower with small children to raise on his own. Social security will pay benefits to children under age 18 (sometimes 19) on the death of a parent.
Yep, child support from the government (my kids are healthy, but just have only one living parent). It happens. It's one of the reasons that I am worried about gov't solvency... Because I am (we are) SS recipient(s).
Kids are 4 and 6, so I have about 14 years left of gov't 'support'. But, the way things are going, I have serious doubts that I will be receiving that last check around my daughter's 18th birthday...
i think the age is 22, as long as they stay in college. i dont know how the govt determines who is in college and not or what a college is. maybe they get a report card.
Wow. I didn't watch that when it was posted and discussed previously. I'm at the 26th (Double-edit: 26th is better starting place) minute or so and have just seen why memmel is wrong regarding 75% job losses needed to equal the great depression level of job losses of just 25%.
Comes down to one simple point: today's families are far more leveraged even with the two incomes. This is largely due to the higher expenses all being in areas that are non-flexible: housing, transportation, child care, health care and taxes. That last is sickening. While the wealthy have had their taxes slashed, the middle class's have risen substantially.
I should have watched this earlier, Leanan.
Cheers
And as they used to say, you are safer taking a one engine airplane, than a plane with two engines, which needs them both!
In the aviation business, we have a saying:
With a twin engine aircraft, if you lose one, you will always have enough power left to make it to the crash site.
Maybe for a Super King Air or some lesser twin bug-smashers in the hands of amateur pilots, but not so much for an Airbus, 767, 777, 737, etc in the hands of largely competent airline pilots. ETOPS much?
Not on the flight deck unfortunately. :-(
All our work was low level surveying, usually below the stall recovery height.
Because of the payload, it meant a lot of ferrying.
No failures on line, but we did lose an engine about 10 sec. after rotation due to a spastic FCU and managed to get back down shiny side up.
Well we did have a case where a light twin lost an engine on takeoff and flipped over before it could get up to maneuvering speed. No survivors. I think at level flight I'd be more likely to agree with you. But that's OT.
Your point is a good one, though. "An heir and spare" they always say. The world's MBAs are trained to push us to max efficiency, no extra inventory, no spare tire. With liquid fuels that's the sort of shape we're in. Hmm. Has all the wealth been extracted already?
The Coming Collapse of the Middle Class
http://www.youtube.com/watch?v=akVL7QY0S8A
"Coming collapse of the middle class" ?
I saw that train leave the station a long time ago. Many poor peoples on the verge of homelessness, swear on a stack of Walmart circulars, they are middle class. As if, by saying with repetition often enough, it will come true.
They don't make Ruby Red slippers like they used too.
This is probably the link that you wanted, which Leanan posted:
http://www.msnbc.msn.com/id/3079221/
Edgy,
I have watched the Warren youtubes. I concur with her exposition yet
beware for her modeling starts around the mid 70s...for a 30 yr span....
Yet to me the real data on the early portion should have started a lot earlier..say in the early 60s.
Perhaps the guv wasn't collecting data at that time.
So I find some of ideas on how and why to be a bit flawed as to what households purchased and the percentage of pay that brought this and that.
So my takeaway is that the rise of two incomes set up us for a huge fall.I personally experienced much of this as women entered the workplace and then all hell broke loose on the family economics. Gladly rising incomes allowed me and others to keep pace and for myself I never allowed myself to become dependent on my wifes very sparse income yet she acted as though the sky was not a limit as to burn out credit cards...I mean burning as in so much friction as to melt the plastic. Or wear the lettering off.
Of course this was all my debt to repay.
If I had not moved us to the farm and made some land investments then today I would be one of those in the vast meltdown of mortgages ,,etc.,
So watch it but judge it.
Airdale
The link is http://www.youtube.com/watch?v=akVL7QY0S8A
Wal-Mart CEO: Spending less has upside
Notice he is outgoing. Now that he has squirreled away his millions from our affluenza afflicition, he talks about how it is healthy for society. And what will he do with his millions? Anyway, the recession is good for Wal Mart as more people will move downscale from higher end stores.
This was picked up in a recent drumbeat and then emphasized in the Richard Heinberg blog linked above. The original article is no longer on Reuters. It is still in Google's cache.
I can find no article on Dar Al Hayat that refers to anything about the Majid Al-Munif oil demand quote. There is a an article at Dar Al Hayat that refers to the EIA numbers as referred to in the Reuters article.
I'm still looking for another source of the Majid Al-Munif quote that doesn't appear to be from Dar Al Hayat. Right now all I'm seeing is a bunch of shoddy cut and paste journalism related to this.
I think the 45% number is so huge that it needs more than Internet rumor level backing to be regarded with any seriousness.
Edit: Further evidence from October:
I'd be willing to be that his more recent statement was about demand growth dropping, and not overall demand.
Demand destruction has achieved the status of mantra in the media recently. The motive behind this is clearly to support the idea that cheap oil is back to stay (there is a market for this information among the news consumers). Two main reasons:1) obviously is that people want cheap oil and 2) the oil spike scared people. I would be surprised if US demand is falling at all from 2008 levels at these prices.
Westexas,
I came across your ELM on the PO debunked blogspot site. Whoever did the "audit" of your model (in my opinion) apparently didn't take calculus... he confuses 'rate' with 'remaining volume'... amoung other things. I found the mis-concepts of math irritating.
Just a suggestion (to pre-emptively cut-off such attacks): clarify the 'rate of decline' definition for the mathematically-challenged. I have to admit that I can see where the confusion sets in.
Respectfully,
Ignorant
That would be our good friend, JD. The simple little Export Land Model (ELM) assumes that an exporting country peaks at 2.0 mbpd, with consumption of 1.0 mbpd (and therefore net exports of 1.0 mbpd), and that production declines at -5%/year, with consumption increasing at +2.5%/year. This results in an approximately linear decline in net oil exports, i.e., an approximately constant volumetric decline. By definition, this is an accelerating decline rate.
For example, in Year One of the decline, we see the following:
Production Decline Rate: -5%/year to 1.90 mbpd
Consumption Rate of Increase: +2.5%/year to 1.03 mbpd
Net Export Decline Rate: -13.9%/year to 0.87 mbpd (1)
In Year Eight of the Decline, we see the following:
Production Decline Rate: -5%/year to 1.34 mbpd
Consumption Rate of Increase: +2.5%/year to 1.22 mbpd
Net Export Decline Rate: -61%/year to 0.12 mbpd (2)
(1) Volumetric net export decline of 0.13 mbpd
(2) Volumetric net export decline of 0.10 mbpd
Note the accelerating net export decline rate, from -13.9%/year to -61.0%/year, versus the fixed single digit production decline rate of -5%/year. In simple percentage terms, a 33% drop in production (to Year Eight), plus a 22% increase in consumption resulted in an 88% decline in net oil exports.
When we compared the ELM to two real life case histories--UK & Indonesia--we saw the same type of accelerating net export decline rates. UK had a lower rate of consumption increase than Export Land, Indonesia, higher. The UK had a higher production decline rate than Export Land, Indonesia, lower.
Denninger explains why hyperinflation cannot happen in the US.
http://market-ticker.denninger.net/authors/2-Karl-Denninger
I disagree with him completely on this point and find his reasoning to be weak, IMO. But he does make a some good points about what would/will happen to the US with hyperinflation.
Didn't read the article but the two reasons he states really illustrates just how insidious inflation can be.
Inflation without wage increase = BIG HURT.
I don't see how there can be inflation without wage increases. How can anyone raise prices when customers have less money? Well, there's credit...but that's not going to increase any more than wages are.
Hyperinflation seems to have happened in Zimbabwe, despite abject poverty.
They were poor, but they're poor with wage increases that Americans would envy (on a percentage basis, of course).
The unemployment rate in Zimbabwe is in excess of 85%. Almost the only people with jobs now are either working for the gov't or working for barter. Most teachers and doctors have stopped working because they can't afford to get to work on their salary (nevermind actually eating).
Any history buffs here know what the wage situation was in the Weimar Republic?
85%?! Really? Wow.
Well that completely destroys the argument that there cannot be inflation without wage increases. Not only can hyperinflation occur in the absence of wage increases, but it can occur in the absence of any wages for the overwhelming majority of the population.
I find the "it can't happen in the U.S." arguments to be quite weak. Shit does happen. Even in America.
Only if the unemployment rate was much lower before the inflation started. If they've always had an unemployment rate like that, then it doesn't matter.
In fact, it looks like they've always had a pretty high unemployment rate:
http://www.indexmundi.com/zimbabwe/unemployment_rate.html
And can I ask you to please watch your language? We don't want TOD filtered by schools and libraries.
Yes, most people in Zimbabwe do not participate in the formal economy and haven't for some time. My point was that the Zimbabwe hyperinflation was not connected with employment.
Still, the fact remains that even teachers and medical professionals have walked out of their jobs in Zimbabwe because their paychecks do not cover the bus fare to get to work.
I didn't say hyperinflation was connected to employment. I said it was connected to wages. Zimbabwe has seen only a slight increase in unemployment, but huge increases in wages. (According to this article, wages in Zimbabwe are commonly indexed to inflation.) Weimar Germany's unions won frequent wage increases (though not enough to keep ahead of inflation). Even the US in the '70s still had unions enough to win pay raises.
As Denninger points out, it's different now. The unions have been eviscerated, jobs are being sent overseas. Real wages have been flat/falling for years, and I don't see that reversing.
I wouldn't base too much on that article. It's not very clearly written and seems to be as much arguing for implementation of "indexation" as much as giving a history. And when its says that indexation has been a part of the "collective bargaining process" it has to make you wonder just how many of the 15% of the employed are covered by collective bargaining contracts.
For wages to drive inflation, you would need for a significantly larger portion of the country to be employed in addition to wage increases.
The difficulty in Zimbabwe is that while real inflation has recently meant that prices could double between the start of the day and the end. Government wages have been tied to the official inflation rate published by the government. That is why nearly all gov't employees (including teachers and doctors) have stopped showing up. Indeed, in the last few months there has even been reports of "rumblings" in the military as even mid level officers are no longer able to live on their salaries.
In short, I don't think there are lessons to be learned from Zimbabwe's situation with regard to the link between wages and inflation.
It does make me wonder what the comparisons would be between "real" wages and inflation in other high inflation and hyper-inflation situations. For example, despite the wage increases of 70's in the U.S., the average worker was paid less in 1985, in constant dollars, than they were in 1973. Is this always the case? You indicate is was in the Weimar.
If it is the case, what's the true causality there, then, between inflation and wage increases?
All very interesting, at least from an intellectual place. Don't know if it will be if we live through it.
Exactly when inflation finally kicks in it won't be for the normal folk.
It will be for example the US government printing money to pay off Bonds and government debt including workers.
This does not mean in our case that the wages would actually rise as COLA increases for most government workers
would probably be slashed.
My opinion is that inflation/hyperinflation in the US will be more a case of falling value of the dollar vs other currencies
in the future not salary inflation.
Think about your typical export economy that devalues its currency vs the dollar this impoverishes the local people as far
as buying imported goods but locally produced goods are fairly cheap.
In the US case our main export is dollars and we import most of our goods. So we would see rapid price increases for imported goods esp oil and rising prices for locally produced goods esp food which is exported and uses oil.
I actually expect salaries to continue to fall despite this notice the rounds of wage cuts and I also expect assets such as houses and land thats not exportable to continue to fall in price.
So at the end of the day looking forward one has to think about where US dollars will go given we are a debtor nation they will in my opinion go to pay off debts and thus not into a traditional wage price spiral.
Indeed the TARP funds have done exactly that so far no stimulus but instead they have paid off debt to prevent collapse.
At some point in the future printing money to pay off debt will result in our creditors demanding "more" which means high interest rates similar to any third world currency. The currency has little value on the international markets and interest rates in that currency are high and yet the population earns peanuts.
Because the input costs are global, the prices can go up. The people living in the U.S. will just spend the same amount of money on less things.
Last year, they bought a big screen TV and went to the restaurant 2 times per week. This year, well...they will buy a new cook book.
EDIT: this is deflation... sorry :) I agree, I don't get how that will work.
It's how the world works ... You've already seen it in the last year with oil (and other commodity) prices ... think essential imports and adverse exchange rates for a rapidly deteriorating situation which can't be controlled ... even by the government spending trillions.
The result of prices rising faster than wages is an overall declining standard of living and is always the end game of inflation ... see Zimbabwe for a current extreme example. A bit of wage inflation is good if you want to pay off debt though!
Actually, I think I've seen the opposite. We're seeing deflation now. Price of commodities is falling. Oil, of course. Even gold.
Hmmm ... maybe ... I don't know your circumstances ... but most haven't so far. You only experience inflation or deflation when you buy or sell something ... every person's experience of overall inflation is different. For years we have had massive money inflation overshoot caused by out of control debt - price rises/falls are just the manifestation of past money supply inflation/deflation.
Rapid change of anything is what does the damage ... acceleration or decceleration.
Six months ago it was massive price hyper-inflation of energy which finally stalled the economy, causing overall standards of living to start to fall ... now we are entering deflation overshoot as less and less debt exists in the system, deflation destroys wealth.
The central banks attempts at control of deflation by infinite growth are very crude and since they don't take account of finite things like peak oil the end game is likely to be a hyper-inflationary overshoot (destroying monetary savings) when fiat money will fail - to be replaced by something else, it always is.
Life, but not as we know it, will continue.
What 60 Minutes Missed on Oil Speculation
http://www.ritholtz.com/blog/2009/01/oil-speculation/
Curious story here. A pilot made an emergency call to air traffic control. His plane was later found crashed. But he was spotted alive and well, checked into a hotel under a false name.
Why would he do that?
Too bad that little airplane didn't make it a little bit further over the GOM. :-P
Probably trying to do a Reggie Perrin.
AKH
Here's the website link: http://www.heritage-wealth.com/index.html
The site doesn't have any real information and doesn't look very professional to me.
HOW TO RESOLVE THE CREDIT CRISIS:
CREDIT WHERE CREDIT IS DUE
TS
Why are 3 month T-bills yielding .12% and investors were lined up to buy them?
You cannot create money if you are a bank that has none to lend out as your debtors have filed for bankruptcy or walked away from non-recourse obligations and cannot pay back in order to replenish funds to needed for future loans.
Why did the bailout money not go to buy troubled mortgages but much was instead given to unstable banks who used the money to buy banks with sound management and in less trouble to subject them to bad management? Why was AIG instructed to not give bonuses to top management and then AIG executives awarded themselves retention fees instead of calling the money a bonus?
Why are funds being invested in some of the most inefficient automakers in the world that levereaged to the max to pay high dividends and outrageous union wages along with exec. compensation?
What is the moral hazard of corrupt investment of public funds?
Why are inefficient energy systems subsidized?
Why was tobacco farming subsidized as Medicare and Medicaid costs spiked?
Why was the U.S. spending more on weapons than any other nation in the world?
Why were sales of derivatives (credit swaps) legalized for the first time in almost a hundred years after being banned because of a major economic crash c. 1890 from non-asset backed paper trading?
Why did a nation think printing more money would lead the way out of recession instead of producing medicine, clothes, food, telecommunications, energy systems etc.? Making a big pile of money bigger is like a government declaring its insolvency.
because corporations are held in law as citizen with no one accountable!
General Motors has a negative book value as listed in Yahoo Finance as -$98.19 per share. Its share price was $4.15 at close yesterday. To pay $4.15 for $98. worth of liabilities and expect the government to bail it out is asking much.
While some claimed there was no such thing as peak oil, for whatever reasons oil production may be falling due to economic reasons.
Less gasoline available will not bode well for the economic prospects of auto makers.
Economic downturn pounds commercial real estate market
This was the part I found interesting:
Regional banks have been a bright spot in the banking business, but I wonder if that will hold up as the mortgage mess spreads to commercial real estate.
More parents request aid, pull kids from private schools
Could China emissions fall back below US emissions in '09?
China power consumption seems to be falling even faster than US power consumption - especially since China's power is mostly for industrial production. Most of us have assumed that China's greenhouse gas emissions were going to keep climbing much higher, but recent electricity pokes holes in that belief of inexorability...
We'll see if we can make this recession a powering down opportunity in preparation for global climate and oil production constraints mitigation-
Dennis
www.setenergy.org
I kinda doubt it. At least if th claimed growth rate of 9% has any relation to reality. Ours is dropping as well, but I think the overall size of China's economy is expected to still grow. Now, if it grows slower than their belated energy efficiency drive, perhaps it will drop a little.
Re: Pickens and energy independence up top.
Pickens wants mandates for compressed natural gas use in trucks. This requires legislation. Legislation is the product of a majority who will vote for it.
Pickens who is 80 hasn't learned or else forgot that forming a majority involves politics. Politics involves giving support to something others want. Hopefully, in return they support what you want. Forming majorities is not about my way or no way.
Pickens has in the past gone out of his way to disparage ethanol. Does he now think that representatives of ethanol/corn producing states are going to support his mandates for compressed natural gas in trucks?
If he does, he is more senile than I thought. If he changes his tune on ethanol there may be room for support of his compressed natural gas mandates. Otherwise forget it.
That's how the game is played. Ethanol producers want the same thing as Pickens: more energy independence and profit for themselves and the country. The way to get it is not to attack others who are striving toward the same goal as Pickens has done in the past.
Thanks for the Julian Cope link. Cope is a deep thinking and a hard working punk. I recommend to at least browse through his books on antiquarians. These tomes are beautifully constructed and feature his photos and essays on ancient monoliths and structures scattered throughout Britain and elsewhere. This guy should get knighted for his creativity.
(Added) check it out http://www.youtube.com/watch?v=iRP45ds_vp0
Not sure where to post a comment on the idea that "peak oil is dead."
On the basis on monitoring the news for peak oil, I would have to say that this claim is absolutely false. My perception is rather that the concept of peak oil has triumphed. Even now that oil prices have crashed, the term continues to be mentioned in many articles.
I no longer see the articles claiming that peak oil is a scam, an industry hoax, a hippie conspiracy. The oil companies seem to have quietly accepted it.
I'm surprised at the many places where peak oil is mentioned - in an interview with a rock star, in a syndicated story getting wide play in the Canadian Press, among investment writers.
The difference in awareness between now and five years ago is stunning. I don't know if any world-changing idea has ever spread so fast in history.
This doesn't mean that governments and the media are pushing peak oil with the urgency we might like. Civilization has a tremendous inertia and our wishes/ideas aren't going to make it change overnight.
I suspect that our attention is going to be absorbed by economic woes, and that peak oil will manifest itself in that way. I wouldn't be surprised if peak oil quietly becomes part of the accepted wisdom.
The important thing is that the idea is out there, available for anyone who wants to learn about it.
Bart
Energy Bulletin
My wife has been telling me that for a while: that PO is mainstream now and those who don't know about it need to catch up.
But it's interesting how PO is calmly accepted by industry while global warming is still mired in controversy. It says to me that the energy industry understands and agrees with PO, that there is still a lot of money to be made after PO, while GW doesn't help existing industry at all.
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