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Drumbeat: April 4, 2010
Posted by Leanan on April 4, 2010 - 10:12am
UK Treasury lukewarm on plan for Iceland to pay debt in energy
Iceland could pay the £3.48bn it owes the UK and Holland by providing the two countries with a steady stream of green electricity instead of cash, if an ambitious proposal by a small Dutch think-tank takes hold.Gijs Graafland, the director of the Amsterdam-based Planck Foundation, contacted Iceland's Prime Minister Johanna Sigurdardottir and its President Olafur Grimsson early this month to suggest that Iceland use its abundant supply of geothermal energy to pay back the British and Dutch loans that bailed out Iceland's failed Icesave bank.
Mr Graafland's "Energy for Debt" plan calls for treating kilowatts as currency. Iceland and its 320,000 inhabitants get all of their electricity from carbon-free sources, including geothermal and hydroelectric.
Like other energy observers, Mr Graafland believes there is huge potential in the country's largely untapped sources of geothermal power – heat form the earth which can be used to drive turbines. Iceland straddles the fault line between the North American and Eurasian tectonics plates, giving it plenty of geological action. He said: "A massive energy transition investment wave can help prevent a collapse from peak oil, and this can also help save the financial system."
New York Regulators Deny Water Permit for Nuclear Plant
NEW YORK -- New York environmental regulators have denied a key water-quality certification Entergy Corp. needs to extend by 20 years its license to operate the 2,000-megawatt Indian Point nuclear-power plant.In a letter to Entergy, posted on the Web site of environmental group Riverkeeper, the New York Department of Environmental Conservation said the two units of the plant "do not and will not comply with existing New York State water quality standards," even with the addition of a new screening technology favored by Entergy to protect aquatic life.
The plant's existing "once-through" system withdraws and returns as much as 2.5 billion gallons of Hudson River water a day for cooling, a system blamed by environmentalists for killing millions of fish and for damaging the river's ecosystem.
Foreign Oil Prices: Drill Obama Drill Just Like You Campaigned Against
Peak oil, is often spoken about and debated. It is the period during the 1970’s, in which the time finally arrived when less oil reserves were available than ever before. The proponent of this theory thought that no mammoth oil field would be discovered in the future. Most do not subscribe to this theory. However, there is an influential group within the White House and government that believes this. In order to counter the ever decreasing world reserves, they have decided to give free reign to the drillers.
Done right, oil and gas drilling in newly accessible areas will be a boon to the nation
Obama's plan throws down the gauntlet to the nation's oil and gas industry to do this job in the cleanest and greenest way. We believe this is a challenge the industry, much of which calls Houston home, can meet and master. We would encourage the oil patch to view it as an opportunity to display its many skills on a grand scale.
Oil, gas and petrochemical projects hold key to Kuwait's 2030 strategy
KUWAIT: The Kuwait Transparency Society (KTS) declared here yesterday the launching of its fourth annual forum on transparency to be held under the patronage of His Highness the Amir Sheikh Sabah Al-Ahmad Al-Jaber Al-Sabah on April (20-21), 2010 under the slogan of "Transparency in Oil Industries".Chairman of the Kuwaiti Transparency Society Salah Al-Ghazali said in a press conference here yesterday that the forum's goals this year is to achieve the values of transparency, integrity and accountability in the Kuwaiti oil sector.
Time for Falklands co-operation
Both the UK and Argentina could benefit from diplomatic negotiations over the exploitation of natural Falklands resources.
Russia bolsters defense, oil ties with Venezuela
CARACAS: Russian Prime Minister Vladimir Putin gave the United States' main Latin American foe, Venezuelan President Hugo Chavez, a needed boost with a brief visit on Friday to discuss oil, defense and nuclear energy cooperation. They launched a $20 billion venture between Russian firms and Venezuelan state company PDVSA aimed at pumping 450,000 barrels a day-almost a fifth of the OPEC member's current output-from the vast Orinoco heavy oil belt. Russia also delivered the last four of 38 military transport helicopters, but no new defense agreements were signed, though Chavez said Moscow was open to help Venezuela develop nuclear energy for generating electricity.
Tesoro Officers Survey Washington Refinery Where Blast Killed 5
(Bloomberg) -- Two of Tesoro Corp.’s top executives traveled to Anacortes, Washington, to survey the damage in what may be the second deadliest refinery accident at a U.S. plant. The fire and explosion killed five and injured two.
Drought causes thermal coal shortage in central China province
About 300,000 tonnes of thermal coals were needed in central China's Hubei Province as lingering drought in the upstream region has cut the hydropower, local officials said Sunday.About 30 percent of Hubei's electricity capacity comes from hydropower generation, but the drought in southwest China has lowered the water level in the Three Gorges reservoir by six meters against the same period last year.
Better get used to gas at $3 a gallon
Prices are still a far cry from where they were two summers ago, when the state average topped out at $4.35 for regular unleaded gasoline.But for many, the slow climb is still a painful reminder of early-recession gas prices — like a treadmill that keeps intensifying just when you need a break.
Oil and Gas Ads Target 'Energy Industry Taxes'
The oil and gas industry is funding an advertising campaign aimed at stopping new energy taxes, an effort that comes as it faces both a loss of tax benefits and possible new penalties as part of climate legislation.
Vermont pats self on back on fuel efficiency rules
Vermont elected officials and environmental groups are patting themselves on the back for the state's role in a national campaign to improve mileage standards and reduce carbon emissions from vehicles.Vermont was the site of a key federal court victory on the road to putting in place new fuel standards announced Thursday by the Obama administration.
Fears coal carrier grounded in Australia could break up
Sydney - The China-registered coal carrier that ran aground on Australia's Great Barrier Reef and is leaking oil could break up, officials said Sunday.
Israel's "Green" Strategy to Defeat Enemies
(Nazareth) -- Under cover of a sudden interest in developing new green technologies, the Israeli government hopes to weaken the Gulf states by making their oil redundant and thereby defeating “Islamic terror”.Uzi Landau, the national infrastructures minister, outlined a vision of a world without oil this week to Israel’s most loyal supporters in Washington as he searched for wealthy American-Jewish investors and White House support for the strategy.
His message was that: “The West is addicted to oil, and so is bound by states that support terrorism … Whoever wants to fight radical Islam and terrorist organizations should know that by purchasing gasoline, he's giving terrorists increased motivation.”
‘Green Gone Wrong’: Can Capitalism Save the Planet?
The global economic collapse pushed the rise of green capitalism off business magazine covers, but it will surely resurface. After all, Wal-Mart and G.E. are still pushing it. In a recession, they need all the good publicity they can get.Now, along comes Heather Rogers, who warns about the dangers of buying into this mind-set with “Green Gone Wrong: How Our Economy Is Undermining the Environmental Revolution” (Scribner, 272 pages, $26). She says green capitalism is actually undermining ecological progress.
Ms. Rogers is a muckraking investigative reporter who is also the author of “Gone Tomorrow: the Hidden Life of Garbage.” She says corporate America has led us into thinking that we can save the earth mainly by buying things like compact fluorescent light bulbs, hybrid gas-electric cars and carbon offsets.
“The new green wave, typified by the phrase ‘lazy environmentalism,’ is geared toward the masses that aren’t willing to sacrifice,” Ms. Rogers complains. “This brand of armchair activism actualizes itself most fully in the realm of consumer goods; through buying the right products we can usher our economic system into the environmental age.”
The peak oil problem, the Transition solution
"Peak oil" -- what is that? The concept has been discussed since 1949, when geologist M. King Hubbert theorized that the extraction of the black gold followed a simple bell curve, meaning that after passing the peak in the curve, extraction would decline. After peak, never again would we be able to extract, and use, as much oil as we had previously.In 1956, Hubbert made a startling and controversial prediction: America's oil production would peak in or around 1970. Hubbert's peers were confounded, as it was inconceivable that the United States, the world's largest oil producer in the first half of the 20th century -- literally the "Saudi Arabia" of the West -- could possibly decline in production.
Another post-oil-novel roundup
This year promises to be a big one for novels set in a world beyond oil. Peak oil icon James Howard Kunstler comes out with The Witch of Hebron, a follow-up to his astonishing, critically acclaimed World Made by Hand, in September. And while the anticipation for Kunstler's book is building, two more post-oil novels are due out next month, Afterlight by Alex Scarrow and Ship Breaker by Paolo Bacigalupi. Of these last two, the one that I'm really excited about is Ship Breaker. It's the second novel of the accomplished, Theodore Sturgeon Award-winning young talent Paolo Bacigalupi, who is known for his evocative post-industrial dystopias.
Between the Civil War and World War II the length of the American work week decreased dramatically. Since the end of World War II, the rate of decline has become positively glacial. The five-day work week with an eight-hour workday came to be seen as the norm over a half a century ago and it is still seen as the norm today. This development caught a lot of attentive observers by surprise -- for example, John Maynard Keynes in 1930 predicted that by 2030 a fifteen hour work week would be sufficient for all but the most extreme workaholics. The stabilization of the work week at forty hours continues to defy easy explanation. Benjamin Hunnicutt knows that the explanation for this dramatic reversal is highly complex. In Work Without End (1988), he offered a strikingly new and controversial thesis that pinpointed the role of policy decisions during the New Deal. In Kellogg's Six-Hour Day, he examines the question from a fascinating new angle -- that of a work force which eagerly adopted the six-hour workday during the Depression, but which reverted back to the eight-hour workday during the postwar period.
The Salty Taste of Energy Independence
Lisa Margonelli, who shared a panel with Majumdar at an event sponsored by Arizona State University at the National Press Club, called what we need “the industrial revolution in triple-time.”We don’t need an extensive oil rig mobilization at sea for a small and far-off quantity of oil (although Obama may need to say that to get moderate Democrats and Republicans on board with his next big domestic policy agenda). We need: solar panels that spray on, sugar that turns into fuel and biomass that becomes ethanol, cars that plug into smart grids that communicate real-time pricing from utilities using carbon sequestration, and a whole bunch of other things no one has thought of yet – and all of it to scale.
WASHINGTON – The Environmental Protection Agency is exploring whether to use the Clean Water Act to control greenhouse gas emissions, which are turning the oceans acidic at a rate that has alarmed some scientists.With climate change legislation stalled in Congress, the Clean Water Act would serve as a second front, as the Obama administration has sought to use the Clean Air Act to rein in emissions of carbon dioxide and other greenhouse gases administratively.
Cap-and-trade could unlock new reserves in Louisiana
HOUMA — Carbon dioxide, known to contribute to global warming, could help unlock billions of barrels of oil from previously tapped Louisiana wells, a report says.If a federal cap-and-trade law regulating carbon dioxide is imposed, industrial plants could dispose of carbon by injecting it into previously tapped onshore oilfields. That would both keep those emissions out of the atmosphere and help increase domestic oil production, says the paper by Advanced Resources International of Arlington, Va., which concentrates on advanced energy-recovery technology.
New York ain't seen nothing yet: Future will bring flooding, hurricanes and violent weather swings
Climate change has already begun and its impact will be felt more intensely throughout the 21st century. Especially in a coastal city like New York.
Climate-change research in Canada waning: scientists
Last week, a climate research centre at the University of Montreal, known by the acronym ESCER, warned that such groups are being forced to close across the country.A lack of federal funds for climate and atmospheric science has "sounded the death knell for research groups working in this field in Canada," Rene Laprise, ESCER's director, wrote in a statement.
What would Reagan do about climate change?
Supporters of climate-change legislation are using a surprising figure to promote their cause: Ronald Reagan.Radio ads asking "What would Reagan do?" are airing during the conservative talk shows of Rush Limbaugh and Glenn Beck on stations in New Hampshire and are planned in other states in the drive to get Congress to act on global warming legislation.
Even in the Desert, Plants Feel the Heat of Global Warming
While desert winters have become warmer and drier over the years, climate changes have pushed the arrival of winter rains later in the year, forcing winter-annual plants like the curvenut combseed (Pectocarya recurvata) to emerge later when temperatures are colder.
The surprise growth at a time of year when ice is normally melting has triggered a blizzard of I-told-you-sos among online climate-change skeptics. But the man whose data is behind the furor says a few weeks of cold weather in one part of the Arctic - not the end of climate change - has skewed the numbers.“It is not the end of global warming,” said Mark Serreze of the National Snow and Ice Data Center in Boulder, Colorado, which publishes monthly sea-ice updates on its website.
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From a few days ago but don't think anyone has posted on it.
Nuclear synthi-jetfuel plants wanted for US Afghan bases
I find the military's move towards cutting their dependence on a traditional oil supply to be one of the most convincing signs that 'change is a-coming.' Granted - a large part of the driver for this move is simply their growing experience in the difficulty and expense in maintaining a continuous and reliable oil supply line to forward areas in remote regions. But that's kind of my point. Whether it is civilian life in Pakistan or military deployments in Afghanistan, these experiences in the growing cost and unreliability of oil supplies are likely to move towards the 'centers of commerce' as global supplies diminish. Phenomena on the edges moving toward the center; a foreshadowing. "We will never run out of oil" may be true - for a narrow enough definition of "we." But there are increasing signs that that pithy phrase is already false for many others.
I agree. The best way to determine the government's real "position on peak oil" is to watch what the military does and ignore what the politicians and clowns in the DOE/EIA say.
Bush and Obama both deserve a size-12 undulating plateau in the arse.
Link up top: The peak oil problem, the Transition solution
This point has been stressed over and over by Gail, myself and a few others. A debt based economy must grow or else collapse. That is not to say that it cannot shrink for a short period of time, a couple of years or so, then rebount. But that rebound can only last if the economy starts to grow again.
Some people point to the huge drop in world supplies in the early 80s and say, "We recovered from that far greater drop in oil supplies therefore it will be easier to recover from this current lesser drop in oil supplies". Not so fast.
The drop in oil supplies to the developed world, has been greater in the last four years than the drop in oil supplies from 1980 until 1985.
US "Total petroleum products supplied" in thousands of barrels per day:
Table 3.1 Petroleum Overview (USA)
The drop in oil supplies to all the other developed nations, with the exception of the oil exporting nations, has been similar to the drop in oil supplies to the USA.
And after 1985 the oil supply began to increase. The economies in all the developed world started to grow again and soon everything was back to normal. And it will happen again... if the world's oil supply starts to grow again. Otherwise it will collapse.
Ron P.
So, could the run-up in price in the last week or so, along with "rosy" pictures of a turning-the-corner economy, be a sign that another relapse is on the horizon?
I'm certainly cautious over any supposed rebound now, what with the prospect of oil shooting up and killing any real economic turnaround. We are in an even worse condition than before the credit crunch started, and now I imagine the limit will be lower before we hit the ceiling for growth and fall into another recession dip.
"We are in an even worse condition than before the credit crunch started, and now I imagine the limit will be lower before we hit the ceiling for growth and fall into another recession dip."
http://www.bloomberg.com/apps/news?pid=newsarchive&sid=a0AJDADVP_N8
The slight rise in money supply M1 according to John William's Shadow Government Statistics gives you a reason for fuel prices moving higher, in the face of slack demand. That is that little hook up on the right. A green shoot!
The decline in M3 money supply suggests that multipliers are non- functional. Without lending there is no recovery. Here is M1 money multipliers from the St. Louis Fed:
The high price of crude is constraining business causing multipliers to fall which in turn represents a decline of available credit. It's a vicious cycle.
At the same time, excess finance liquidity heads into petroleum because the prices are 'going up' and small amounts of liquidity can amplify the process.
"After all, a debt-based economy requires continuous growth in order to function correctly."
This particulate dogma has been around since early days of attention on the Web to peak oil. In those early days I tried in vain to point out how it simply was not true. The belief now is simply too entrenched to effectively challenge. At least, I will not butt my head against that particular stone wall any more. Someone with "interest" in it might find it a worthwhile challenge.
My confidence in my assertion stems from the development of a number of models for alternative currencies that were discussed in a many-to-many mail group years ago.
The roots of the misunderstanding lie partially in a misapplication of exponential growth and failure to grasp "money" in its information-like properties.
The analysis that shows a debt-based economy does not require continuous growth also lays bare numerous pitfalls one can get into with the use of debt. In general, game theory considerations apply and attempt to maximize individual profit can very easily lead to system wide negative consequences. That we have today in spades.
Debt can be partially characterized in many ways and one useful one is to consider it as "floating" title to goods and services available in the economy currently and in some sort of "future space". In this sense saying that a debt-based economy requires growth is like saying necessarily more title is issued than can be satisfied by production. That this is not so does not mean that such excess title can not be issued and in my view this excess has been a growing fact for many decades. To do so has been profitable for certain key players (doing very well, thank you) but very destructive to the system as a whole.
Debt can be partially characterized in many ways and one useful one is to consider it as "floating" title to goods and services available in the economy currently and in some sort of "future space".
I don't see how this statement "escapes" the claim that 'debt-based economy requires continuous growth to function properly.' If debt is a claim against future production (spend now, pay later), the only was that the future state is not impoverished by the current debt is if the future economy has grown faster because of current indebtedness. In other words, the present debt is created as an investment to grow future production. But this is a not a counter to the claim that 'debt-based economies require continuous growth.' It merely explains the function of beneficial debt. Detrimental debt provides no such increase in future production.
What do you suppose happens if future production is not possible because it hits a resource limit?
Not that any of us have to worry about that, it's purely a rhetorical question, since the MSM reassures us today with the words of no other than the greatest American economist to have ever chaired the Fed...drum roll please!
http://www.cnn.com/2010/POLITICS/04/04/us.economy/index.html?hpt=T1
W.T.F.! Really Mr. Greenspan didn't you also say this:
Well I guess you of all people should be allowed to have your cake and eat it too. Though as far as I'm concerned, it should be well stuffed with crow. I just wish you would just crawl back under your rock and henceforth keep your delusional opinions to yourself... someone should just tell you to STFU! /rant!
Happy Easter All!
"the only was [sic, "way"?] that the future state is not impoverished by the current debt is if the future economy has grown faster because of current indebtedness"
Is that true? "the only way"? How much have you explored other possible ways before you decided that this was the only way? You are outright assuming what you seem to be demonstrating.
One can quite easily imagine creating debt to finance a "negative growth" in an economy. Let me give a simple example applying to one enterprise. Suppose in one year you decided to expand your enterprise (without debt) from one that was modestly but stably profitable and it didn't work out. So you try to recoup matters by financing a contraction back to the previous year's stable level. Perhaps this is successful but put your enterprise into a barely profitable rather than modestly profitable mode for a few (or many) years. Where is the inherent growth?
Now, admittedly, many arguments that apply to an individual firm fail when applied to a system as a whole. I would rather leave expanding the type of argument made above to a system level to the reader.
Keep it up. I am having trouble understanding the argument that debt requires growth. Did debt just arise after the existence of relatiely stable, no growth or very little growth societies in history and aincient history?
Taking part of one's income and paying off a loan. I need income to pay off debt, but do I need growth to have income or production?
I am honestly strggling to understand this debt needs growth argument but cannot so far. So it is good to see you having this dialogue.
I can see the argument that taking debt to an extreme bubble like has happened in the U.S. requires growth. Beyond that, I am not so sure.
I am having trouble understanding the argument that debt requires growth.
I'm not surprised because as you point out there are situations in which debt doesn't require growth. If I take on a mortgage that I can service out of current income then I should be able to continue to service it even if my income remains constant. Depending on the repayments I may even be able to sacrifice some income and still service the debt.
On the other hand there are situations where assumed debt is close to the limits of current affordability and no contraction of income is possible without default. Or where the conditions of the loan require income growth to maintain - teaser mortgage rates are a good example here.
Moving away from individual debt payable via income there is the slightly different situation of taking on debt for investment by business. Here business growth is often required in order to service the debt. No point building a plant to produce products that no-one then buys! I suspect that most of the assumptions around the requirement of growth to fund debt are around investment debt rather than individual mortgage (or similar) debt.
But even for business there is no a priori reason why debt absolutely has to be taken on in order to survive, any more than it is essential that companies grow to survive (plenty of companies do fine just ticking over with a steady business model and relying mainly on efficiency improvements to increase returns - utilities for example). As companies become more peak oil aware they will defer investment decisions rather than take on debt they no longer believes make sense. Some of the big oil co's are already making these decisions.
TW
I'm trying to understand your claim that 'debt based economies require continuous growth to function' isn't true. As far as I can tell, your first post simply relabeled the issue without providing any new way of viewing the problem. "A floating title on goods in a future state" didn't seem to provide anything new.
Maybe this post provides a suggestion towards a new way to play the game. If the economy contracts as a whole, but your production decreases less than average, then your relative wealth has increased. Debt which slows your contraction might be beneficial in such a case, even though there is no growth. So the game might be structured as "your future contraction + debt" < "average contraction". But this makes sense only in groups - since it is relative wealth that we are increasing, total real wealth has decreased. One company among many. One nation among many. But the wealth of the group as a whole has still decreased.
Can a case be made that current debt can slow the overall rate of decline in a declining economy? "contraction + debt" < "contraction without debt". I suppose we can modify the previous statement. Some debt is investment - either increasing or slowing the contraction of future production. Other debt is simply consumptive - destroying future production for current consumption. But I don't sense any sea-change in this reformulation.
It is not merely relabeling. It is pointing out that excessive debt is a major current problem whether or not is was the product of a necessary connection between debt and growth. It is that assumption that I challenge. It is a very strong statement and I was hoping to smoke out some of the assumptions behind it, not present an alternative view in detail that would be convincing. I think the burden of proof should be on the claim, not the questioning of the claim.
"contraction + debt" < "contraction without debt"
What if there were a situation where a particular contraction would lead to collapse and a particular use of debt could allow systems to readjust to a lower level of production.
"contraction(without collapse) + debt(wisely applied)" < "contraction(without debt leading to collapse)"
You can doubt that that would happen for various reasons but to say that it necessarily can't happen is, in my mind, a misunderstanding of the nature of debt.
would hold under conditions where "debt" was used to
I think the burden of proof should be on the claim
AKA you don't want to do the heavy lifting of arguing your point.
Go ahead - show the Economic model that supports your idea. In fact, make a big long post. If its good enough, you'll have your own campfire spot.
Good enough as judged by whom?
I did my bit of heavy lifting on this subject back in the 80s. What I had to say then did not conform. Your claim is that a debt based currency requires growth. You consider that claim established unless someone does the "heavy lifting" to prove it wrong? How about if I claim that a debt based currency does not require growth? Now do you have to show that one does to prove me wrong? Obviously not. But do you detect an asymmetry here?
Debt has always and will always exist. There are limits to how much debt an economy can support, however.
I think the phrase "debt phase change" entered into your favorite search engine should reveal some interesting thought on the topic.
As far as a debt based currency not requiring growth: while it is theoretically possible I do believe that human nature prevents putting that particular theory into practice, so I for one am willing to accept his assertion as true enough for working purposes.
I don’t know if I want to wade into the “debt based system always requires growth” debate too far, but to the extent that productivity is improving by investment financed by debt, then an argument can be made that debt helps growth. Problems with the debt based financial system, long known to suffer periods of “bubbles’ and “panics”, seems to destabilize under periods of too much debt growth.
However I think that debt-growth debate is more of a distraction than anything else in the post peak oil world. Of the course the proper use of debt is a concern, but as noted by others (above for example), the use of oil in the US correlates well with the level economic activity (especially when adjusting for more or less continuous productivity gains over the last century).
A better question then is whether there is also a fairly direct relationship between the value of existing investment and oil use. Attempts to push the economy beyond the limits set by oil by issuing more debt created massive mal-investment, which eventually resulted in a fairly sudden realization that many marginal investments - such as residences in far flung suburbia - didn’t have a high value in the post peak world.
Unfortunately the heavy recent use of government debt to attempt to overcome the limits of PO will also fail. How will it fail? We don’t know yet. Possibly a devaluation of the currencies being printed up, investor demands for higher interest rates from those countries issuing debt, or even more extreme measures such as demands for a new trade relationship where fiat money is no longer accepted for oil.
However with oil output marginally higher this year, and some leftover inventories from last year’s financial panic still remaining, we are not yet on the verge of the next crisis - but we are getting there within another year or less.
"I think that debt-growth debate is more of a distraction than anything else in the post peak oil world"
I sympathize with your point here. It was with reluctance that I let myself get into it. A very strong statement was made about debt and growth that was counter to my understanding and I responded to that. Further, to my observation debt-growth connection as presented amounts to an assumption that is very widely and strongly held by peak oil types. If I am right and it represents a basic mistake about how money systems operate and if (a proposition more likely to be accepted) post peak there will have to be a great many changes in monetary systems, this "mistake" can have very serious consequences.
As a further point, in my view, there is a lot of very good understanding among serious non-mainstream economists. The ideas about debt commonly supported in peak oil world will produce a barrier between those economists and peak-oilists.
"A better question then is whether there is also a fairly direct relationship between the value of existing investment and oil use. "
Do you really find that a question? I find "fairly direct relationship" a considerable understatement.
I have a particular prejudice against the term "fiat money". The denotation is okay but there is a connotation that tends to hide important issues. That connotation is, in my view, "has no backing" which is far from the case. In my view, our money most definitely has a backing: the government's power to tax. It could be argued that that backing is undergoing extreme erosion and to refer to it as "fiat" money tends to obscure what's going on.
More directly stated is not the problem with fiat money by itself, but the ability to produce unlimted quantities of fiat money - with the marginal amount of new fiat money essentially having no additional backing.
That is the ability to tax is limited, while the ability to issue money is not. Therefore at some point all additional new money has no real or even implied value in a conventional sense. I suppose an unconventional, military threat to force another country to take one's money is an external power, in addition to the internal power of taxation.
"the ability to tax is limited, while the ability to issue money is not"
I would say the ability to issue money is limited by the ability to tax. Money having value, that is. We're note talking stacks of bills but interest rates on Treasury paper.
"an unconventional, military threat to force another country to take one's money "
Shhh, don't give "them" any ideas. We're not talking about marching in and taking over some oil fields. There are less direct ways of destabilizing a kingdom. Maybe the fix is in and KSA will continue to find value in dollars beyond the point supported by conventional economic valuations.
Yes, interest rates will catch up with inflation, but it may take up to two or three years for rates to catch up with inflation that already happened.
.
No economist but I think once the realization that the price of oil will continuously be upward irregardless , means interest rates will continue to rise, crippling debt growth. The reason is pretty straightforward. Accelerating oil value has to be seen as a tax on future profits and a restriction of future sales. Similarly dollars borrowed or monetized for government programs are subject to the same diminishing effectiveness and the same paucity of revenues to replace or repay because of reduced growth expectations. New price spikes bring new downturns.
Inescapable high oil hitting business and consumer alike is quite different than a future where there is a chance the lifeblood of an economy can be had cheaply once again. As soon as everyone understands that there is no good cheap alternative growth medium then debt will no longer cut it. Not anywhere near these levels. How do you increase leverage on a diminishing return? With fantasy finance ,of course, resulting in the type of meltdown we just underwent.
Long bonds and 10yr T bills are already rising despite billions given to banks at near zero interest rates. Housing prices continue to fall in spite of incentives and FedGov buying up paper en masse. Banks are now offering to lower principle on loans in order to keep some revenue. Bulldozing houses in distressed areas has become an acceptable way to manage municipal budgets. It seems peak oil is already forcing the debt economy to shrink. And ELM 2.0 is just getting started.
Our 19 million barrels a day is fueling way too many useless functions. Aside from food and energy most of them will likely undergo further contraction. Oil dependent retail, airlines, trucking, food service, hospitality and real estate alone will account for millions more jobs lost. Unless fast alternatives develop the burden on hemorrhaging budgets will be paralyzing. As to whether debt based systems always require growth lets just say that to repay the current and future debt in this system will require orders of magnitude more growth than peak oil is ever going to let it produce.
"As to whether debt based systems always require growth lets just say that to repay the current and future debt in this system will require orders of magnitude more growth than peak oil is ever going to let it produce."
This part of your statement is one point: "to repay the current and future debt in this system will require orders of magnitude more growth than peak oil is ever going to let it produce". I would not want to argue that point (though it might be argued -- how about requiring only one order of magnitude -- glad you didn't through in a kleptocratic elite and ecological collapse along with PO)
"debt based systems always require growth" is, to my way thinking, another point and one that under the right circumstances I would argue with. People say, what difference does it make, given the second point. Again, I would say, under the right circumstances I would be willing to argue that it could make an important difference.
Yeah I figured that one might get a response. I'll go for one order of magnitude too. Although the thing is it may be possible for the debt to accelerate in one direction while the ability to grow decelerates the other way. Here I have the picture of the woman burning script in the Weimar Republic to heat the house.
What is the US at now say 60 trillion in debt and unfunded liabilities? I'm not sure what an auction of the whole place would be worth but then I'm figuring for taxing purposes we'd want to keep some productive capacity for future growth.
There is the fact that at present there is no plan in place to curb spending or deal with the revenue side at all. So until there is either a tax program in place with a reasonable prospect of repayment or unforeseen growth on the horizon the trends will continue unabated. Now if the ability to produce is severely restricted on the other hand, going from 100 quads to say 25 in the next 30 years I might say rather than orders just a snowballs chance in hell :)
And I actually think that much of these deficits we are growing is a stimulus response to keep growth going when the net energy, the per capita energy, and the energy quality have fallen far below what it took to operate the economy when abundant high-grade supplies existed underfoot.
Well put but I don't think an oil price lessthan $100 will seriously dent the US economy at this time. And yes, I do see eventualy record high oil prices inflecting a crushing blow on the US economy - which has been based upon the use of low priced oil.
A great portion of the US infrastructure was built with very cheap oil, and even the first half of the 2000s housing boom had oil a fraction of the price where it is now.
Perhaps more important than price is supply. I view that worse effects of peak oil resulting not because of price but availability of oil. That is because supplies may fall more or less continously below minimum operating levels of the distrubution system within two years.
"not yet on the verge of the next crisis"......
That is possibly not true.
Now oil is $85.83/bbl. It seems to be going up almost $1 every day. Governments and other institutions lined up to produce conditions that would call forth more energy flow and energy demand. Otherwise (ie without the revenue flowing, the taxes coming in) the people in the government are not going to be eating, is I guess the issue at hand that is so irksome. I read about quite a few government building projects getting underway hurriedly in the past few months. OK, so now they are running the bulldozers, every day these monsters need diesel. So what happens? The price of oil starts going up again. And the projects can`t be stopped on a dime. That wouldn`t look good. Not just the govt, but also many companies are getting further into debt to build new buildings--I think the banks got easy money from the govt to finance buildings to boost the economy. These projects can`t be easily stopped once started just because oil prices start inching up $1 every day. That would be "chicken".
The oil investors know about these conditions and are investing accordingly. I think now is definitely the time to invest in oil. The price is going to zoom up....to I think at least $100 this time, probably more. Maybe even more than $147, which would be really exciting. Crisis= exciting???? Maybe so, if you read TOD.
Heaven forbid! I really hope we don't have the same repetitive frothing-at-the-mouth endless pointless posts we had as the price went over $US100 and then hit $US147. Please let's not have that again - it brings all the madder doomers out to play, apart from anything else.
Maybe the "madder doomers" are right. This time the price will go up quite fast and perhaps exceed $147. It already is up to almost $88. The conditions have been massaged---perhaps artificially---into existance and now it is hard to stop the process (called "growth") until the crash occurs. Why does it have to be like this? I think it is human nature to just want to be absolutely sure that the whole set-up (built infrastructure) is in vain before we abandon it. We are testing our theories about how we built civilization. Apparently, the test keeps coming back "failed" and we don`t like that answer--it`s inconvenient--- so we try again.
One day we will accept the horrible verdict---that all that cement, all those cars---- were all built in vain. It is funny to watch. The word "mad" does seem to fit perfectly. Call me a "madder doomer" if you like, actually I don`t like cars or bulldozers so anything---like high oil prices-- which seems to be obstacles to their smooth path is really interesting.
I don’t know if I want to wade into the “debt based system always requires growth”
If everyone is gonna get paid off without someone being "cheated" via bankruptcy or some other "swindle" then yes you need growth.
(and using the word always or any other absolute term opens one up for the point being debatable.)
Someone can try to rebut this presumption, but I suspect USA year to year changes in total debt (household, public, corporate)have always (or almost always) exceeded changes in GDP for basically my lifetime (since 1965). If an energy revolution can change that, great. If not, we're f***ed.
"I don't see how this statement "escapes" the claim ... "
It's not meant to escape the claim. It was put in there to say something that might be easily understood by those on both side of the issue. It is admittedly a very defective formulation, or perhaps better, a shorthand way to bring a complex point into focus. One of the reasons that the claim 'debt-based economy requires continuous growth to function properly.' has a superficial plausibility is that it "explains" what is going on. The model I go by explains the effects also: More has been promised than can be produced. It is actually possible to promise (debt) at or below a level that can be produced.
I had a detailed guest post here about the subject of then and now as regards demand, you know. Finished products supplied peaked in 1978, not 1980, your .pdf only has '80 and '75 numbers. In 1982 we were at 74.02% of the peak value; the recent corresponding peak was in 2005 and in 2009 we were at 89.40%, thus your conclusion about demand contracting more now is incorrect.
"Prices are still a far cry from where they were two summers ago, when the state average topped out at $4.35 for regular unleaded gasoline."
Still cheap compared to Canada. Gasoline in Calgary is about 95 cents a litre, or about $4 per gallon or so (C$ almost at par with US$). Prices are higher elsewhere in Canada. Yet people still drive lots. We need to see prices get up to European levels before the general public will get really, really serious about driving.
The best thing that could be done would be a slow creep upward, so that people don't really notice. A sudden price spike would cause another round of blaming the Seven Sisters and legislative hearings to bring prices back down.
Pah, we're over $8 a gallon here in the UK now.
Although that's per UK Gallon. At roughly £1.20 per litre that's just under $7 per US Gallon.
Right now gasoline is CA$1.12/liter in Metro Vancouver and it's been over a dollar/litre for months. Unlike Alberta, we do have a carbon tax and transit tax on fuel. By the way, CA$1.12/liter works out to US$4.16/gallon, yet just south of here (Seattle) drivers think US$3.00/gallon sucks?? Surprisingly, no one's complaining or noticably reducing their driving up here -- we've gotten used to the "new" prices.
Thats exactly right - economies get adjusted to new price. It is the rapid increase in price that causes problems, rather than absolute price level. Just above we see in UK they pay eq. of $7/gallon.
That $7/gal is mostly taxes...which makes it's way right back into your economy, and not just out the tailpipe as smoke.
Frugal, They just pop over the border to fill up at our Canadian friendly price of $3.15 US per gallon.
Hamster in Bellingham, WA (don't blink going through downtown, because if you fall asleep at the wheel, you will shortly find yourself queuing for the border.)
Yeah a lot of people do cross the border to fill up. The only problem is the 2-hour line ups to get across the border, plus the extra fuel burned to get to Blaine and back.
Was just in your lovely town and did a lot of walking...didn't need a car. Noticed that new residences being planned will also have to prepare for PHEV hookups! Also, like the "lane house" concept increasing density downtown. A lot of good things happening in Vancouver!
I do agree that the city of Vancouver is ahead of the pack compared to other North American cities. The same cannot be said for Vancouver`s outer suburbs, which are indistinguishable from any other in North America. Head east from downtown for about an hour and you`ll see what I`m talking about -- the best farmland in British Columbia being eaten up by strip malls and row upon row of McMansions. Luckily, most tourist never set foot on these parts of the metro area. The strangest thing is the marked cultural difference between Vancouver`s population and its suburban counterpart.
No question that Vancouver is ahead of just about any large American city when it comes to PO planning. Your UBC and its Ecological Economics department there has no doubt helped to raise awareness. BC is 95% powered by renewables and enjoys a lot of electric bus/rail transport which is going to be very helpful. Most of the Taxi's are now Prius's too. We took the new Metro to the Olympic village from downtown and it was pretty sweet. I live in northern Michigan and am following the TT Bloomington Indiana planning process which may be a good model for us here in the Midwest. Noticed a post on TOD about this today too.
Was wondering if you know my friend, Bryn Davidson, of the Dynamic cities project? http://dynamiccities.squarespace.com/
We also like to stay in Victoria and there it is even easier to get around walking or biking ... especially using the Galloping Goose rail trail where the cars have to stop for the bicycles. Do you have any observations on how Vancouver island and Victoria might fair as compared to the mainland in terms of PO preparedness/resiliency?
Jim, no I don't know your friend, Bryn Davidson. I never bring up the word "peak oil" with friends or coworkers as I don't want them to think that I've lost my mind. However, there's no doubt that the PO concept has gathered steam in Vancouver over the last couple of years. I think $1.50/litre gasoline in the summer of 2008 had something to do with this new awareness. In the last year, three sets of friends, who I had now idea were PO aware, have brought up the subject and asked me for my opinion. I find this really refreshing.
On the federal or provincial (state) level, there has been no talk whatsoever of peak oil or its consequences. I'm not sure if politicians at this level are clueless about PO, are in denial, or know about it but don't dare bringing it up publicly. It seems that the mayor of Vancouver, Gregor Robinson, has some understanding of what an energy constrained city would look like, but I don't recall if he's ever mentioned the word "peak oil". The inner suburb of Burnaby cranked out this PO report in 2006 GLOBAL PEAK IN OIL PRODUCTION: THE MUNICIPAL CONTEXT, but nothing concrete seems to have come out of it. PO is only occasionally mentioned in the mainstream media.
Victoria is the capital city of British Columbia and is located on the southern tip of Vancouver Island. Except for forestry, there is very little industry on the island. All, or almost all, of Vancouver Island's electricity, natural gas, and food comes from the mainland. Because of this, I would think that Vancouver is in somewhat better position to weather PO than Victoria. That said, the paving over of the Fraser Valley, Vancouver's bread basket does not bode well for the future. On the plus side, we do have lots of fresh water.
"there has been no talk whatsoever of peak oil or its consequences."
Here in Cowtown I've been told by more than one petro-executive that everyone agrees about Peak Oil but the consequences of speaking the truth out loud are too great. Executives of publicly-traded oil companies can be sued for saying such things if it causes the stock price to drop or even if it doesn't. No politician is going to tell the voters "No, you can't have a $500,000 particleboard house 25 km from where you work because it's unsustainable". That's not how you get re-elected.
So you're saying that Harper, Obama, etc. probably know about peak oil but are deadly afraid of even whispering the word, kind of like you never hear them say "bubble" when it comes housing or "ponzi" when it comes to banking.
One has to keep the sheeple paying the mortgage, shopping at WallCrap, and financing the next chevy.
It is everyones interest, as even j6p needs to finance his next Jet Ski.
yes, there is no doubt that Obama and Steven Chu are PO aware...I have seen a presentation by Chu on this subject. Here is a more recent example from the Obama administration. http://petrole.blog.lemonde.fr/2010/03/25/washington-considers-a-decline...
I believe your Vancouver Mayor is aware too, from what I have read. Many government leaders are PO aware but just don't want to discuss it in this context for some of the reasons you outlined. Leaders will take a lead on this when they feel that is what the public wants and they can do so without losing their jobs. Until then, expect things to remain unsaid, although this seems to be changing somewhat.
I think Peak Oil is considered a given in Calgary, but oil company executives are mostly concerned about how much money they can make from it. Under any realistic scenario, it will probably be a lot of money. The politicians are more concerned about how much tax money they can make from the oil companies, which under any realistic scenario will pay for a lot of votes.
The bad thing about it is that Calgarians will continue to drive huge 4x4's extremely fast. "Drive fast, freeze an Easterner", as the saying goes.
I agree that Vancouver is ahead of the curve when it comes to PO preparation.
There's just one problem left for Vancouver. It's in the midst of a nasty housing bubble of epic proportions, fueled by Asian money and the psychology that you are rich if the mortgage on your small condo or townhome is a million dollars. It's going to crash soon and leave Vancouver a much poorer place. See Miami and Las Vegas to understand where this is headed.
Once this excess is flushed out, Vancouver - and the whole Pacific Northwest, for that matter - will still have alot of strengths going forward. Just pray they don't fall victim to a massive earthquake, which is always a risk there.
I'll second most of that, Frugal. The City of Vancouver (which is about 1/4 of the people who live in Greater Vancouver) will do fine with peak oil. It is relatively dense (downtown has a higher population density than Manhattan), it is possible to live and work there without a car. There are many knowledge based businesses that do not have high energy inputs. The climate is mild, and there is much scope for reduction in heating energy (through use of air or even water source heat pumps).
Vancouver is also Canada's major west coast port. If PO really takes a bite into imports, Vancouver will feel that pinch hard. So too with tourism, Vancouver (and Whistler) are VERY dependent on air travel, so that will decrease.
The "suburbs" (Burnaby, Surrey, Abbotsford etc) are indeed as bad as any other sprawl, though traffic is not yet LA proportions. These places build their own car dependent sprawl then ask the provincial government for money for rail transit, even though they never set aside corridors for such. They are addicted to the higher property taxes from housing as opposed to farming, so the result has been predictable - those household lawns grow very well on prime farming land.
AS good as we think Vancouver is, and it is one of the best in N. America, it is far short of the ability of many European cities to function on minimal oil consumption. But we do have the people that are most receptive to change, and a mayor who wants to implement it, so we should see further improvement.
The lane house can be seen as a step in the right direction, but the problem is that it really perpetuates the lower density areas. What really needs to happen is to start taking whole blocks/neighborhoods and redeveloping them for higher density. AS in, take down the houses, redesign the area with narrow streets (15-20' wide) to reclaim all the road space and build terrace housing along the new streets, with all of this clustered close to the transit lines. You would end up with something looking more like European villages, but that is a good things
http://www.newworldeconomics.com/archives/2010/030710.html
One of the reasons why Vancouver has been successful to date with densification is simply that it has almost no new land available, and only limited old industrial land for redevelopment. For the city to "grow" it has no choice. But it also means it has been able to grow without needing (too many) new roads etc, other than the transit lines, of course.
The densification and car elimination has started, with an uptick in the economy, I think it will accelerate.
Fuel oil leak forces family from 150-year-old farmhome
See: http://www.mlive.com/news/saginaw/index.ssf/2010/04/fuel_oil_leak_forces...
Heating oil can be nasty stuff. Friends of ours had oil stolen from their vacation home -- it was an outside tank and thieves disconnected the supply line and didn't bother to reconnect it, allowing a large quantity of oil to seep into the ground. It contaminated a number of area wells, multiple lawsuits were filed and their insurance company basically hung them out to dry. It left them in near financial ruin and nearly cost them their marriage. To further complicate matters, thieves did the very same thing to the church next door, so the two insurance companies were trying to "pass the buck", each claiming that the ground water contamination was caused by the other party.
I see another church in PEI is coping with the aftermath of their oil leak (http://www.cbc.ca/canada/prince-edward-island/story/2010/04/02/ns-oil-le...).
My mom's oil tank leaked and the smell lingered on for a year or more. You wanted to gag as soon as you walked through the front door. When we bought this home the oil tank was thirty-four years old and although it appeared to be in good shape, we replaced it immediately; I wasn't going to take any chances. In hindsight, I should have removed our oil heating system and installed a small electric boiler instead.
Cheers,
Paul
‘Green Gone Wrong’: Can Capitalism Save the Planet?
When only 30% of the money goes to saving and 70% is "overhead" - No.
http://www.environmentalleader.com/2009/12/08/uk-report-just-30-of-carbo...
Mr Graafland's "Energy for Debt" plan calls for treating kilowatts as currency.
http://www.technocracy.ca/simp/certificate.htm
Adapted from an article by Harold Fezer in Technocracy, Series A, number 10, July, 1937.
Arctic sea ice is nearly back to average global levels for the first time in at least a decade after years of spectacular declines
Huh. I was listening to a CBC podcast interviewing a crew on an icebreaker and they claimed that while the birds in the sky showed ice - yet this "new ice" is "rotten" and not solid like past ice.
http://www.cbc.ca/quirks/media/2007-2008/mp3/qq-2007-11-24.mp3
(dug that up to respond to un-attributed claims by someone who self IDed as a 'student of economics' and 'member of wall street' whom I was challenging to back his claims up but the original post I challenged was deleted and so thus was my reply)
I think this sums up capitalism's relation to the planet.
No amount of green washing will rid the filth:
http://www.youtube.com/watch?v=dlbgPb1TOUs&feature=player_embedded
The big hullabaloo about ice extent increasing in the Artic almost reaching the average of 1979-2000 is in the article below.
http://www.theglobeandmail.com/news/national/arctic-ice-makes-surprising...
Here is the link to the graph of ice extent:
http://nsidc.org/arcticseaicenews/
As you can see it has just started to descend, having not actually touched the 1979-2000 avg., but even if it did what matters is ice thickness. Here is what is said about that in the article:
However you will notice in the article the anti-global warming people have latched onto this as being a sign that global warming is simply a hoax. Short term trends however do not negate an overall trend. The tale of the tape will occur months from now at the bottom of the ice melt curve when we discover if the ice extent is average, above or below the norm. I'll update this site with information when that occurs.
I think Stewart's parody on this captured the stupidity best. Just because it is cold in Jan compared to June doesn't mean AGW is a hoax.
Just force-feed those hoax-proclaimers this Deep Solar Minimum -tablet
Summer of 2013 could become more convincing, I guess.
Yeah, it appears that the Sunspot cycle 24 is beginning to strengthen. Any bets on another warm year similar to 1998's bump? This time, given the increase in greenhouse gases, global temperatures might exceeding the 1998 bump. Parts of China are already in a severe drought.
E. Swanson
I guess the real question is whether the extra ice will hang around long enough to deflect late spring sunlight, thereby keeping the arctic cooler this summer, causing more ice to remain in late summer.
Of course, it still looks like there won't be much late summer sea ice in the arctic 20 years from now.
No, it won't.
Logic: Came late, can't be thick.
Logic: Most of the ice creating he "bump" is in the Barentz, which is among the first ice to disappear, and isn't even in the Arctic Ocean, but between Alaska and Russia outside of the Arctic Ocean.
Logic: Look at the graph showing concentration and see how thinly packed much of that ice is.
This bump won't mean much of anything come June.
Cheers
As far as ice extent goes, the max extent hasn't varied as much as the min extent.
http://www.arctic.noaa.gov/reportcard/figures/seaice2009fig2.jpg
ftp://sidads.colorado.edu/DATASETS/NOAA/G02135/Mar/N_03_plot.png
What is interesting is that max extent in 2010 appears to have been reached in April rather than the more typical March. This whole "arctic ice is back to normal" meme is driven by guys who get more excited by singular data points than by trends.
It is amazing how one tiny bit of news gets so much mileage from the deniers. Especially when it's only one brief period of time and the ice extent only got close to the average of 1979-2000. I guess their over enthusiastic rush to judgement exposes the minor bits of data they can find to run with that helps support their assertions. Kind of like the person losing badly in tennis, yet goes berzerk on any point won with fist pumps and huge yells. The outcome is still the same though, losing, just like the deniers lost this argument quite some time ago.
"WATCH VIDEO: Greenland's Petermann Glacier is poised to lose a Manhattan-sized chunk, and the Nares Strait was ice-free all year for the first time, according to Greenpeace."
http://news.discovery.com/earth/methane-leak-permafrost-arctic.html
Thanks, great link.
Also Nitrous is a problem:
http://www.reuters.com/article/idUSTRE63311Z20100404?sp=true
eyore, I noticed the video on the Petermann Glacier was from July 09. I wonder if it did break free or might this coming thaw.
The methane leaking in the Arctic seems to be a situation with lots of possible outcomes, from long term release, to shorter term to very suddenly. Suddenly would definitely be a game changer. I think we'll know pretty quickly by how much methane releases in succeeding years. Is it accelerating at some particular rate or remaining steady. This years artic summer should be interesting.
It might not last, it might. It's not a hoax, it's relevant information. If it continues to accumulate it will add to the ice permanently. That would be the process of how it increased. The decline in the ice is one of the main evidence for those who support global warming (but doesn't still prove if it is man made) so an increase to 2001 levels needs to be watched over time.
The extent is all well and good, but it's late season ice so it won't have had the cold months of the year to build up strength and thickness.
Hmm, I wonder if the ice pack reaching peak coverage so late in the season isn't another indication of warming. Built up heat in the Arctic Ocean from last year's that had to go away before the ice could form. 40% chance of a hard collapse of the Arctic ice sheet this summer?
Pulled this off of my Yahoo finance page today under under ticker symbol COP
http://seekingalpha.com/article/196876-officials-wake-up-to-peak-oil?sou...
Good to see that Nelder piece making the rounds. I left a comment. thanks
Robert Rapier comes to NZ:
http://www.stuff.co.nz/business/3546885/Wood-waste-could-be-key-to-keepi...
(with a lot of information about the wood waste company he works for - odd name for a company, Merica...... I guess cos its a 'Merican company)
[quote="andyh"]I guess cos its a 'Merican company)[/quote]
No, it's been discussed by RR on his blog IIRC. I don't have a link and don't remember the particulars off the top of my head. I suspect it's searchable.
Score one for Matt Simmons:
http://online.wsj.com/article/SB1000142405270230391210457516389129235493...
U.S. to Change Natural-Gas Data Statistics
I wonder what the problem was that they uncovered that caused them to pull the net oil export data tables off their website (an e-mail from a EIA employee said that they found unspecified problems with their data collection efforts).
There is also a problem with oil inventory reports, which will come as no surprise to me and many others here. I have repeatedly pointed out that recently most of the week to week changes in 'inventories' were in fact mostly caused by correcting amounts from prior weeks - thereby giving a misleading impression on how much oil is consumed in the current week.
On top of that, the EIA in no way adjusts for oil stored offshore. Therefore the liquidation of offshore oil inventories has been 'invisible' and has also re-enforced misleading perceptions about the rate of oil usage.
http://www.upstreamonline.com/live/article211022.ece?WT.mc_id=rechargene...
What a surprise...
I note the article credits Mark Papa CEO of EOG Resources for bringing it to public attention. Poor Matt doesn't get a mention.
What's next from the EIA - an admission that the margin of error in reported world oil figures is also over 10%?
From link above:
The Netherlands and the UK are crazy if they don't jump at this proposition. Can you imagine, someone offers you real electricity instead of worthless fiat currency, and you say no.
@Frugal
That was my logic when I came up with the concept of unitising Energy Pools
Gijs has recently enthusiastically amended his existing concept - which was conventional loans in fiat currency repayable from the proceeds of selling energy - after I explained the unitisation concept to him.
It would have been nice to have had an acknowledgment, but what actually worries me is that a little knowledge is a dangerous thing......
Chris. At least it must feel good that someone is taking your concept seriously. Usually nobody listens when you come up with a good idea.
How do they get the juice to the UK and Holland? By email, microwave, or in a fleet of under-utilised cod-fishing boats?
They'll put em in EEStor EESU's.
I think they lack the capacity to do so.
Saw this on a news feed:
China's oil demand increase 'astonishing', says IEA
Interesting, after the EIA admission from the March 30, 2010 Drumbeat that liquids production may decline as early as 2011.
http://www.theoildrum.com/node/6341
"Richard Heinberg: Quacks Like A Duck"
I think you have the timeline confused. That link about China's oil demand is dated March 12, before the Heinberg article.
Alternatively world oil production is a long way down from peak but rather than report the truth they have to report "astonishing" (or unbelievable) increases in consumption outside the OECD to match the fake production numbers.
Monday morning exchanges already moving the price of oil to 85.76
http://www.oil-price.net/
Here's an article on the rising price of oil: http://www.businessweek.com/news/2010-04-05/oil-rises-to-17-month-high-o...
'Oil Rises to 17-Month High on Speculation Demand Is Recovering'
I'd take the up on that energy deal. That excess energy could be used to drive a nice industrial park that needs large amounts of energy (Aluminum creation, etc.)