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Drumbeat: November 3, 2010
Posted by Leanan on November 3, 2010 - 10:25am
The Peak Oil Crisis: The Leading Edge
Some hold that our sustainability problem started when we first started planting crops and domesticating animals 10,000 years ago. This thesis says if we had stuck with hunting and gathering as a race we would have been able to sustain our act indefinitely, but then we would never have had enough surplus energy to learn reading & writing, and to build cities, the Internet and space ships. Our immediate problem, however, started in earnest with the industrial revolution about 200 years ago when we first started digging up prodigious quantities of coal and feeding it into steam engines. It wasn't long before we struck oil and the rest is history. The world's population went from an estimated 5 or 10 million when we first started farming, to a billion when we started serious coal digging, to about 7 billion today. We also got incredibly richer in terms of material goods and could sure get around much faster.In retrospect it was an incredible couple of centuries, with some, but not all, aspects of civilization reaching new highs. Mankind's greatest omission during this period was the failure to use our newfound sources of energy and knowledge to make all these wonderful benefits sustainable. We simply dug the coal, pumped the oil, and contaminated the atmosphere as fast as economically feasible. Now these golden centuries are drawing to a close.
The winners and losers from this election, hidden amidst the noise
The USA faces many challenges as we enter a new century. A demographic transitions, with the aging of the baby boom. Financial, coping with our past debts and lavish promises of future spending. Geopolitical, adjusting to the arrival of new great powers and the evolution of a new global financial system. Economic, such as the approach and arrival of peak oil. Many of these will require strong Federal action. Simple-minded and angry ideologues, relying on an imaginary invisible hand and examples of rugged individualism of an imaginary past, probably will put this nation on the track to ruin.
Weekly Oil Roundup: Oil Supplies Still Building
Crude oil briefly touched an overnight high at $85 on the heels of an industry report showing across-the-board declines in US inventories. Prices, however, fell back, as the time for the release of the US Energy Department's weekly inventory report approached.Justifiably so. The government's definitive data showed a 2.0-million-barrel build in domestic crude stocks to 368.2 million. Supplies had been seen falling by 4.1 million barrels, according to estimates by the American Petroleum Institute. Analysts' forecasts were divided, as some called for inventories to increase by 1.2 million to 1.5 million barrels, and others eyed a 2.0-million-barrel decline.
Petrobras questions BG reserves boost
Brazilian state-run Petrobras today questioned British gas producer BG Group's move to boost its oil reserve estimates for discoveries in Brazil, saying the company should await the completion of wells being drilled there.
Goldman Cuts Estimates On Marathon Oil, Cites Gulf Production
Goldman Sachs lowered its earnings estimates on shares of Marathon Oil through 2015 as production from the Gulf of Mexico is expected to slow. In the report, Goldman maintained its neutral rating and set a new price target of $35 per share.
Australia military head warns of Pacific climate instability
SYDNEY (AFP) – Australia's military chief has warned that his troops are likely to be sent to the Pacific more often and on bigger missions as small island states become increasingly unstable due to climate change.
Facebook Under Pressure to Be Greener
PARIS — Facebook, the giant social networking site, is under fire from Greenpeace International, the environmental campaigner, over its construction of a data center in Prineville, Oregon, that will be powered by PacifiCorp, a company that gets 58 percent of its energy from burning coal.Storing and transmitting messages, pictures and other information through Facebook uses a vast and rapidly increasing amount of energy, as the network continues to expand. Its membership passed the 500 million mark in July this year.
Successful Ormat Waste Heat Recovery Test Could Green Dying Oil Fields
Normally the hot water that drives a geothermal turbine system comes from naturally occurring geothermal hot springs.But Ormat is developing a way to conserve underground resources by re-injecting used drilling fluids used in oil extraction back into the Earth to be reheated and used again.
Sustainable Bonds Hope to Help Fix the Planet
Sean Kidney, chairman and co-founder of the Climate Bonds Initiative — an international network that advocates raising money through the bond market for climate protection projects — argues that “themed” bonds have long been a way to raise large sums of money for specific purposes.For example, “the U.S. civil war was financed with war bonds,” Mr. Kidney told delegates at a carbon conference in Singapore last week. “Although these war bonds were targeted at retail investors, most of the money raised came from institutional investors.”
Deflated, economy in decline: a talk with Nicole Foss
Loughrey: Many in the peak oil community believe higher oil prices created our economic crisis. You disagree. Why?Foss: You don’t need to postulate a shortage of energy to precede a financial crisis. Because financial bubbles are Ponzi schemes, and are therefore inherently self-limiting, they reach a top and they crash on their own. The spike in mid 2008 to $147 per barrel was a massive speculative bubble. We said at the time that it would be followed by an enormous price crash, and it was. This smaller speculative bubble will end the same way. Oil prices could go down quite sharply to as low as $20 a barrel.
Argentina's collapse and the grassroots of resilience
Another important early discovery was that beyond the collapse of complex systems, which often do not serve a community's best interests, people learned what was real to them. Real things included not only those necessary for survival but also items which strengthened the community overall. Barter markets level societies in unexpected ways. This lesson was hard-learned by public servants who were the last reluctant segment to join the barter markets. Physicians, in particular, valued their services initially on par with farmers and other experienced food production laborers. As the government collapse continued and economic pressures mounted, they swiftly found themselves adjusting their prices downward. Many professionals learned that their knowledge and education could not compete with those of organic farmers, bee-keepers and even those who manufactured musical instruments.
Scientists answer Guardian readers' toughest energy questions
Nine of the world's top energy scientists answer your questions on topics from peak oil to nuclear fusion.
Persian Gulf faces supertanker shortage for first time in a year
The Persian Gulf, the world’s biggest crude oil loading region, lacks sufficient supertankers to take the fuel for the first time in almost a year, potentially helping to sustain a rally in freight costs.There are 1 percent fewer very large crude carriers, or VLCCs, for hire over the next 30 days than there are cargoes, according to the median estimate of eight shipbrokers and owners surveyed by Bloomberg News today. There was a 20 percent surplus a week ago.
Sinopec plans record crude runs amid diesel shortage
BEIJING (Reuters) - Sinopec, Asia's top oil refiner, plans to process a daily record 583,000 tonnes, or 4.26 million barrels per day (bpd) of crude oil in November amid increasing domestic diesel supply tightness, state news agency Xinhua said on Wednesday.Government-mandated power rationing to factories aimed at achieving Beijing's energy saving goal has slashed China's diesel exports as plants rush to fire up stand-alone diesel generators.
Natural-Gas Growth Seen Slowing As Hedges Expire
The natural-gas industry is growing on borrowed time.A surge in new natural-gas supplies available through shale-gas drilling has caused sustained downward pressure on prices in North America over the last two years. Producers have continued to increase production despite falling prices in large part because of financial hedges put in place when the market was stronger.
'More shutdowns for Statoil maintenance'
Oil platforms operated by Statoil off Norway will shut down more often in future to cope with maintenance issues, trade union SAFE’s leader Terje Nustad said today."You will have more shutdowns, more often than before," said Nustad, head of the union representing some 2300 Statoil employees to Reuters.
"It is one of the bigger problems due to the lack of maintenance on the equipment."
Gazprom International has made its first commercial gas discovery on the African continent in Algeria, its head Boris Ivanov said today.
Russia's Rosneft raises '10 output to 119 mln tonnes
(Reuters) - Russia's largest oil producer, Rosneft increased its crude output target for 2010 to 119 million tonnes (872 million barrels) the company said in a press statement on its website on Wednesday."Preliminary data shows that 2010 production will grow by 7-7.5 percent compared to last year and reach 119 million tonnes," the statement said.
Analysis: Majors Dominate Top 10 of Platts' Global Energy Company Rankings
Integrated oil and gas (IOG) companies continue to dominate the 10 top spots in the 2010 Platts Top 250 Global Energy Company Rankings, despite an unprecedented drop in natural gas demand and slump in oil prices that resulted in a more than one-third decline in 2009 profits.
Action pledged on soaring food prices
ABU DHABI // Global food prices are to be tracked on a central computer database to help to predict potential shortages.The database will be ready within a year, Sultan al Mansouri, the Minister of Economy, said in a letter to the FNC yesterday.
"It will produce reports on the food situation and expectations in the UAE and other countries," the minister said. "This system will play a crucial role in warning of impending food shortages."
PSO threatens to stop oil imports
ISLAMABAD: With its receivables touching a record Rs160 billion, the Pakistan State Oil (PSO) on Tuesday informed the government that it had decided to defer oil imports for a week and to cancel import orders ‘in the pipeline’ within a week unless it was paid a minimum of Rs40 billion upfront.An ‘emergency support’ of Rs40 billion from the federal government would only help PSO to avert default on international payments, but it will still need more money to meet the fuel requirement for power generation to avert a more serious power crisis in winter months.
Employees of the government-run power sector burn effigies representing the International Monetary Fund (IMF) during a protest against a rise in fuel and electricity prices in Lahore yesterday.
President orders early wind, solar projects
KARACHI - President Asif Ali Zardari on Tuesday presided over a number of meetings and briefings on various development projects at Bilawal House Karachi, advising the government to step up the projects so that maximum benefit could be provided to the people.Presiding over a meeting on Alternate Energy Options, the President called for stepping up search for out of box, imaginative and bold solutions to meet the country’s energy needs through alternate sources such as wind and solar power. Those who attended the meetings included Sindh Chief Minister, relevant federal and provincial ministers and senior officials of the federal and provincial governments.
Siemens launches first wind turbine apprenticeship in UK
Siemens has joined forces with REpower and Weir Group to launch the UK’s first wind turbine apprenticeship scheme to tackle the engineering skills shortage in the energy sector.
GM strengthens ties with Chinese partner
NEW YORK (CNNMoney.com) -- General Motors announced closer ties with its Chinese partner SAIC Motor Corp. on Wednesday, in a partnership aimed at designing new vehicles for global markets.
Saudi Aramco working on long term strategy to reduce emissions
Saudi Aramco, the world’s biggest oil producer, is working on a long term strategy to reduce its greenhouse gas emissions, an official from the company’s EXPEC Advanced Research Center said.
BP's Alaska pipelines in danger of rupturing
The huge pipeline system that moves oil, gas and waste between BP's operations in Alaska is plagued by severe corrosion, an internal maintenance report says.The document, obtained by the independent investigative journalism group ProPublica, shows that as of October 1, at least 148 BP pipelines on Alaska's North Slope received an ''F-rank'' from the company.
Oil Rises to a Six-Month High on U.S. Stimulus Bets, Fuel Supply Forecast
Oil advanced to a six-month high of more than $85 a barrel on signs U.S. crude inventories are dropping and speculation stimulus measures by the Federal Reserve will weaken the dollar.Crude stockpiles in the U.S., the world’s biggest oil consumer, dropped 4.1 million barrels last week, the most since July, the industry-backed American Petroleum Institute said yesterday. The Energy Department will release its own report today. The Fed, wrapping up a two-day meeting today, may announce a plan to purchase at least $500 billion in long-term securities, according to economists surveyed by Bloomberg News.
LNG's Asia Premium to U.S. Gas Advances to 20-Month High
The premium of Asian liquefied natural gas over U.S. benchmark prices for the fuel, at the highest level in 20 months, may increase amid colder-than-normal weather in China and rising use by factories.
Saudi Aramco Raises December Prices on All Grades to Asia, U.S. Price Cut
Saudi Aramco, the world’s largest state-owned oil company, raised official selling prices for all crude grades for customers in Asia for December as processing profits for refiners have climbed.
Saudi Arabia Has Enough Crude for 80 Years, Naimi Says
SINGAPORE (UPI) -- Saudi Arabia can maintain its current crude oil production levels for at least 80 years, the country's oil minister said at a Singapore energy conference.Saudi Oil Minister Ali al-Naimi told delegates at an energy summit in Singapore that his country has plenty of oil left to exploit.
"With 264 billion barrels of proven reserves, at current production levels, the kingdom could continue to supply crude oil for another 80 years even if we never find another barrel," he was quoted by Bloomberg News as saying. "However, we are finding those new barrels."
UAE energy minister upbeat about current oil prices
ABU DHABI-- The current oil prices ranging from $75- 80 per a barrel are reasonable for producers and consumers as well, said the UAE Energy Minister Mohammed bin Dhaen Al Hamili, while touring Abu Dhabi International Petroleum Exhibition and Conference (ADIPEC).
Nuclear Power Gains in Republican House Victory; `Cap and Trade' Suffers
Electricity producers such as NRG Energy Inc. and Southern Co. will benefit as Republicans, projected to have won control of the U.S. House yesterday, promote nuclear power as part of clean-energy legislation.Requirements for the use of renewable power to reduce carbon emissions and encourage U.S. energy independence may win passage if nuclear plants are added to the wind turbines and solar panels favored by environmentalists, said David Crane, chief executive officer of Princeton, New Jersey-based NRG.
Ethanol Credit for Archer Daniels May Be Target as Republicans Seize House
Republican election victories yesterday may spell trouble for U.S. subsidies that benefit ethanol producers including Archer Daniels Midland Co., after the party pledged to cut government spending.
EU energy minister courting Russia?
MOSCOW (UPI) -- The Nord Stream and South Stream natural gas pipelines could find significance in a European energy strategy, a Russian energy minister said.Russian energy company Gazprom is moving ahead with its Nord Stream and South Stream natural gas pipelines for Europe.
Spats with Ukraine, which is a transit site for the bulk of Russian gas bound for Europe, exposed vulnerabilities in the regional energy sector, prompting a push for transit diversification.
Russian ex-PM, Gazprom founder Chernomyrdin dies
MOSCOW (Reuters) – Viktor Chernomyrdin, who founded the world's biggest gas company Gazprom and helped steer Russia through the chaos that followed the collapse of the Soviet Union, died Wednesday aged 72.The longest serving prime minister in post-Soviet Russia, Chernomyrdin played a decisive role in supporting former President Boris Yeltsin during some of the darkest moments of the 1990s, negotiating with Chechen rebels and even holding the reins of power while Yeltsin underwent heart surgery in 1996.
Statoil bids to boost Norway exploration
State explorer Statoil said today it has submitted an application for new production licences in the Barents Sea and the Norwegian Sea in the country’s 21st licensing round in a bid to boost activity off Norway.
Statoil Falls Most Since May After Cutting Oil, Gas Output Target for 2010
Statoil ASA, Norway’s largest oil and natural gas company, fell the most since May in Oslo trading after cutting its full-year production target because of halts at fields and missing analysts’ estimates for adjusted profit.The company cut its production guidance for the year to 1.9 million barrels of oil equivalent a day, from 1.925 million to 1.975 million a day, the Stavanger-based company said in a statement today. Adjusted net income fell 8 percent to 8.5 billion kroner ($1.4 billion), missing the average estimate of 9.2 billion kroner in a survey of analysts.
Pipeline leaks hit Enbridge results
Pipeline operator Enbridge Inc. says its third-quarter profit weakened as it dealt with two pipeline leaks in the U.S. Midwest and clean-up associated with the spills.The company says profits dropped to $157-million, equal to 42 cents per share, compared to $304-million or 83 cents a year ago.
US independent Cimarex Energy cut its full-year production forecast, as it unveiled lower-than-expected third-quarter profits on the back of a drop in natural gas prices in North America.
Russia's Gazprom Neft beats Q3 net profit fcast
MOSCOW (Reuters) - Gazprom Neft, the oil arm of Russia's gas giant Gazprom, said on Wednesday its third-quarter net profit rose by more than 2 percent to $865 million as sales increased, beating analyst forecasts.Analysts, polled by Reuters, expected net income to edge down to $826 million on the back of declining oil production.
Gas price cap 'hampers' development
Government price caps on natural gas are holding back the development of shale and other unconventional reserves that could solve the Gulf's gas shortage, international oil executives say.If governments allowed power utilities and industry to pay higher prices, Gulf states could replicate a boom in gas production in North America, led by development of difficult shale gas reservoirs, said Jonathan Evans, the general manager of BP Oman.
BG's $15 Billion Australia LNG Project Sparks `Dash for Labor' With Rivals
BG Group Plc’s $15 billion liquefied natural gas project in Australia’s Queensland state will spark a “dash for labor” as the U.K.-based energy producer and rivals compete for skilled workers, Sanford C. Bernstein & Co. said.BG committed Oct. 31 to the Queensland Curtis LNG venture, the first of four Gladstone developments to start construction. “We now move from the ‘dash for gas’ to the ‘dash for labor’ phase,” said Neil Beveridge, a Bernstein analyst in Hong Kong.
Germany quietly dishes out onshore blocks
Germany's most populous state, North-Rhine Westphalia, home to mining and utilities, has awarded exploration licenses to ExxonMobil and nine other companies to search for unconventional gas, Green Party enquiries have revealed.
BP's Dudley Embraces Deepwater Risk in U.S., Brazil After Spill
BP Plc Chief Executive Officer Robert Dudley expects to drill in the U.S. Gulf for 20 years as the company exploits its experience searching for oil miles below the sea.“Companies like BP, one of the roles they play in the industry is working in riskier areas,” Dudley, 55, said in an interview at BP’s worldwide London headquarters yesterday. BP “is now going to become incredibly focused on managing the risks, for example, of deep-water. It’s not going to shy away from the risk, it’s going to get even better at it.”
A Collaborative Effort to Prevent the Next Spill
Soon after the Deepwater Horizon explosion and oil spill, the two chairmen of the presidential commission appointed to look into the catastrophe and some other officials raised the idea of the offshore oil industry’s doing what the nuclear industry did after the Three Mile Island meltdown of 1979: create an industry-wide organization that would conduct peer-to-peer audits and identify “best practices” that could be cloned from place to place to improve safety.
Toxic chemicals found deep at BP oil spill site
WASHINGTON (Reuters) – Toxic chemicals at levels high enough to kill sea animals extended deep underwater soon after the BP oil spill, U.S. researchers reported on Tuesday.They found evidence of the chemicals as deep as 3,300 feet and as far away as 8 miles in May, and said the spread likely worsened as more oil spilled.
Spill Cleanup Proceeds Amid Mistrust
But despite the debates about where the oil has gone, the most visible effects of the spill are steadily disappearing. Of the roughly 580 miles of oiled shoreline, only about 30 miles are showing “heavy oil” effects, Rear Adm. Paul Zukunft of the Coast Guard said at a recent press conference.As fishermen keep their eyes peeled for slicks and voice concerns that they may be fishing in contaminated waters, some scientists suggest that these fears may be misplaced. The most serious worries about the spill’s damage at this point lie not in lingering surface oil and tainted seafood, they say, but in long-term damage already done to breeding populations of fish, crabs and other commercially important species.
Norway's oil fund to start buying real estate soon
(Reuters) - Norway's $500-billion-plus sovereign wealth fund will start investing in real estate in the "near future" and will probably broaden its portfolio further with infrastructure assets, the central bank chief said on Tuesday.Norges Bank runs Norway's wealth fund on behalf of the government, which siphons away the bulk of the North Sea state's taxes from oil and gas activities into the offshore fund.
Yemen Plans Tighter Security for Energy Companies After Pipeline Blast
Yemen plans to tighten security for energy companies operating within its borders as it investigates the cause of an explosion at a crude pipeline yesterday, the country’s oil minister said.“We are working as a government on a plan to protect all oil companies, and I believe the companies are satisfied with what we’ve done already,” Amir al-Aidarous said in Abu Dhabi today. “This is not Afghanistan. This is Yemen.”
Iran says West's 'arrogance' could doom nuke talks
TEHRAN, Iran – Iran's president said Wednesday that upcoming talks with six world powers about its disputed nuclear program will fail if those nations continue along what he called a "path of arrogance."Mahmoud Ahmadinejad's comments, made in an address to a crowd of thousands in northeastern Iran, cast doubt on any possible progress in talks that Tehran has said it is ready to hold with the six powers — the U.S. Russia, China, Britain, France and Germany — sometime after Nov. 10.
Jeff Rubin: Quantitative easing is just devaluation
As the Federal Reserve Board gets ready for yet another round of quantitative easing (i.e. printing more money), one may well ask: Why? If previous quantitative easing hasn’t spurred domestic spending, why does the Fed believe that more of the same will suddenly produce results?
Who Is Paying the Price Tag for the Coming Election?
With enough money, one can achieve almost anything, so what happens when one “follows the money” regarding the Tea Party? Looking at what the Tea Party is trying to accomplish immediately puts the “money trail” in the spotlight.The most threatening issues for the big oil and coal companies is the possibility of man-made climate change, the result of too much CO2 and other greenhouse gasses, and peak oil. If these two issues can be made to disappear, the problems are solved, and it’s back to business and profits as usual.
Technology seen as key to future of mining as sector faces lower grades
PERTH (miningweekly.com) – Finding easily accessible resources would become increasingly difficult as global demand continued to grow, but Rio Tinto CEO Tom Albanese said that it was premature to speculate about mineral depletion.Albanese, who was speaking at the China Overseas Investment Fair, said that the earth’s geological endowment of minerals was “absolutely enormous” and that speculation on ‘peak metals’, like ‘peak oil’, was premature.
“That said, it will be increasingly more difficult to find potentially high-grade mineral resources,” Albanese added.
Let's get fuel poverty policy back on track
Data published on 13 October by the Department of Energy and Climate Change (Decc) shows that in 2008 there were 3.3 million fuel poor households in England. In the same document, Decc published estimated figures for 2010 indicating that four million households are currently in fuel poverty. Yet the Warm Homes and Energy Conservation Act 2000 requires the government to eradicate fuel poverty in England, as far as is reasonably practicable, by 2016.
UK: Landlords face fines for energy inefficiency
The government is to beef up legislation forcing landlords to pay a fine if they rent properties without proper insulation.The new strictures on the quality of homes are included in the "green deal" which the government will announce today and put before parliament in December.
Transition Voice Covers Peak Oil, Zombies and Economic Crisis
The second issue of the world's only magazine on peak oil features full coverage of the World Oil Conference held in Washington, DC this fall, and analysis of how the impending world energy crisis is already holding back the US economic recovery. The issue also features an essay on today's zombie craze, reviews of important books on energy and the economy, and features like Thanksgiving recipes, a photo gallery of stunning barns from farms across the nation, and a report from Britain on pioneering work done to help communities plan to power down in the future while rebuilding their local economies and creating good jobs.
How Peak Oil Shapes Energy Policy
"Peak oil" is something of a hot potato these days. On one hand, advocates assert that we have arrived at the point of maximum output and will soon see oil production going into a state of escalating prices and terminal decline. Critics of peak oil rebuff these claims as being made by soothsayers of gloom and doom. No one really knows where oil comes from, let alone how much there is or how long it will last.The issue is not simply a matter of academic theory. At stake are energy policies involving jobs, corporate revenues, international relations between consuming and supplying nations and the security and stability of nations.
The innovative Living Smart course covers all aspects of modern and sustainable living: energy, water, food, biodiversity, the healthy home, transport, waste and our health.Supported by the NSW Government’s Climate Change Fund, the course explores how to take realistic initiatives and set achievable goals to deal with global warming, peak oil, food security and water deficiency.
Root cellars part of eating local
Pierre Clouthier, who lives on a rural property in Nova Scotia, hired a contactor to build a root cellar to store enough apples, beets, potatoes, carrots and parsnips to feed him and his wife from November to April.“I’m not a survivalist fringe nut,” he says, but he is concerned about “peak oil” and buys from local farmers to support regional agricultural infrastructure. To build the root cellar, he needed a backhoe to dig a hole in the earth. He then built an 8-by-8-foot room with cinder blocks, leaving the earth floor bare and two ventilation holes to allow air circulation and prevent mould growth. The domed roof was made of poured concrete, the arched design allowing condensation to drip down the walls rather than onto the produce below. The project cost him $3,500.
Japan’s Auto Parts Makers Try to Anticipate Shift to Electric Cars
HAMAMATSU, Japan — People here refer to it as “electric vehicle shock.”Sooner or, more likely, later the electric car could render thousands of companies superfluous here in the heart of Japan’s auto parts region.
No more engines. No call for exhaust pipes. Spark plugs? Gone with the electric-car wind.
Or so, in essence, warns a recent widely circulated study that predicts the eventual demise of much of Hamamatsu’s gasoline engine economy. Spurred by that study and a general sense of foreboding, carmakers, parts factories and local governments in this sprawling industrial town are joining forces to prepare for a future of electric vehicles.
China to Subsidize Electric Car Battery Development, Business News Reports
China’s State-owned Assets Supervision and Administration Commission will subsidize government-controlled companies for electric car battery development, the China Business News reported,citing an unidentified person close to the commission.
First stage completed of China's largest wind power project in NW China
China has completed building the first-stage of Jiuquan wind power base, the country's largest wind power project, in northwest China, local officials said at the ceremony to mark the completion Wednesday.
S.Korea to build 8.2 billion-dollar offshore wind farm
SEOUL — South Korea said Tuesday it would build a massive offshore wind farm off the west coast by 2019 to develop new sources of renewable energy and help wind turbine exporters.Under the 9.2 trillion won (8.2 billion dollars) project, companies such as Hyundai Heavy Industries and Daewoo Shipbuilding and Marine Engineering plan to build 500 turbines, the Knowledge Economy Ministry said in a statement.
German Solar Power Production Costs May Sink Below Gas, Coal in 5 Years
Electricity from solar panels in Germany may be as cheap as power from new gas and coal plants within five to eight years, a study by A.T. Kearney Inc. showed.Production costs for solar power could be as low as 12.6 euro cents ($0.18) per kilowatt-hour by 2020 compared, with about 15.6 cents for fossil-fuel electricity generation, according to the study, which was commissioned by Phoenix Solar AG, a solar array developer.
S.Korea may send troops to UAE over reactor contract
Seoul is considering sending about 150 soldiers to the United Arab Emirates to protect South Korean companies and workers who will be building nuclear power plants there, an official said on Wednesday.
Nuclear Companies Face Bleak Outlook in the U.S.
A third-generation pressurized water reactor, EPR is the first of its kind to hit the markets. But it seems less exciting now than it did when EDF and CEG first joined forces in 2007.Less exciting, at least, in the U.S. The natural gas glut and resulting low prices have seen to that, along with the fact that the cost of building EPRs has skyrocketed. And now EDF has to find a new U.S. partner for its costly and complex project, which has already experienced repeated delays and cost overruns. Originally estimated at €3.5 billion, projections now sit at €5-6 billion.
Woman Wanted by E.P.A. Is Arrested
Ms. Deleon, 40, is the first woman to be listed on the E.P.A.’s two-year-old fugitives list, which includes people wanted for crimes ranging from dumping oil or contaminated soil to importing vehicles that fail to meet United States emissions standards.She could face substantial jail time after extradition to the United States, given that she was convicted of 28 counts that carried penalties of 5 to 20 years, the E.P.A. said.
National Parks Reach Out to Blacks Who Aren’t Visiting
Studies and surveys show that visitors to the nation’s 393 national parks — there were 285.5 million of them in 2009 — are overwhelmingly non-Hispanic whites, with blacks the least likely group to visit. That reality has not changed since the 1960s, when it was first identified as an issue. The Park Service now says the problem is linked to the parks’ very survival.“If the American public doesn’t know that we exist or doesn’t care, our mission is potentially in jeopardy,” said Jonathan B. Jarvis, who took over as director of the Park Service last year. “There’s a disconnect that needs addressing.”
Professional climate change deniers' crusade continues
In the media and the courts, the battle to undermine climate science and its researchers hasn't let up, warns climatologist Michael Mann.
China Says Nations Have a `Common Duty, Responsibility' on Climate Change
A Chinese climate change official said countries share “a common duty and responsibility” to tackle the issue, even in the absence of an international agreement on what steps to take.Nations shouldn’t delay acting on climate change, Sun Zhen, deputy general counsel at the National Development and Reform Commission’s department of climate change, said at a global warming forum in Hong Kong today. “Evidence of the effects of climate change is there,” he said.
Full steam ahead on carbon plan
Abu Dhabi's onshore oil company is so sure carbon dioxide is the key to unlocking the emirate's oil reserves it is to launch a second full-scale project by the middle of decade, executives say.The project, approved by the Abu Dhabi National Oil Company (ADNOC), will gather carbon dioxide from the company's gas-processing plant at Habshan and inject it into the giant onshore Bab field in the southwest of the capital.
Voters overwhelmingly reject Proposition 23
California voters overwhelmingly rejected a controversial measure to roll back the state's landmark climate-change law, sending a strong pro-environment message at a time of deep economic weakness.With about 40 percent of the votes counted late Tuesday, state residents were voting by a margin of more than 19 percentage points to defeat Proposition 23, which would have suspended the state's 4-year-old greenhouse gas-reduction law, a cornerstone of outgoing Gov. Arnold Schwarzenegger's political legacy.
"This is huge because it's the largest public referendum in history on climate and clean energy policy," said Fred Krupp, president of the Environmental Defense Fund.
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Thanks California for saving British Columbia's largest industry. Individual entrepeneurs and quasi-corporate motorcycle enthusiasts alike are very appreciative.
phuuuuuuuuuu. aaaahhhhh.
Re: German Solar Power Production Costs May Sink Below Gas, Coal in 5 Years
Wait, what? I thought solar didn't work in Germany and that it was only a fossil fuel extender in the rest of the world. A new paradigm and a new economy based on renewables is just some pipe dream thought up by the likes of the Bundeswehr. While meanwhile here in the US it's beginning to look a lot like Christmas for the Drill Baby Drill set! Of course someone might stuff some coal in their stockings...
http://www.youtube.com/watch?v=n5DR1oyr4g8
Link to German Solar Power Production Costs May Sink Below Gas, Coal in 5 Years
That study was commissioned by Phoenix Solar AG, a solar array developer and undertaken by the Super_Duper_Multidisciplinary_Consultants at A.T. Kearney Inc ..
If you browse through A.T. Kearney's "Our Experience bragging list" you will notice that their experience actually covers absolutely everything under the sun , a little bit like my own coverage, so therein lies some snags.
I'm always very skeptical when I see a survey or report commissioned by someone havning vested interests in a positive outcome of the same .... like say this conclusion.
So there you have it , the tidbits I was looking for. On the other hand it is obviously true.
So is 'Clean Coal'! Merry Coalmas to you too!
I found a press release from the solar company who paid for the study. It sounds like if you make assumptions in a way that favors solar PV, in five to eight years, with the right metrics, solar may be ahead.
One of the issues is what you compare the savings to. Is it the savings the natural gas usage avoided only, since you still have to run all of the fossil fuel plants anyhow, and have operators on hand? Or is the savings the cost of the electricity that would have been generated, either at an average rate, or at the higher rate that might have been in effect at the time the electricity was generated? This study seems to assume the highest of these alternatives--the cost of electricity at the time the electricity was generated.
Another question is in figuring these costs, what kind of generation do you assume--the newest available, or based on embedded costs. For fossil fuels, cost of new generation is higher, because of the depreciation costs of the new plants. For solar, hopefully the costs are coming down. The study chooses newest costs.
A third issue is what do you compare these costs to--the feed in tariff being paid to homeowners, or to what the theoretical costs of new generation are? It sounds to me as though the comparison is to the theoretical cost of new generation, which is much lower than the current feed-in tariff.
The timing referred to in the press release is five to eight years. The press release in English is not very clear. Additional material in German can be found here.
My usual snark and personal interests aside, (I think most people here know I work with Solar) what I find most significant are points 3 and 4 cited in the study.
I personally think that if whole cost accounting including the environmental impact of CO2 released into the atmosphere (In Europe they actually consider such things to be important) is part of the overall calculus then photovoltaics become even more cost effective than they already are. If they have indeed matured to the point where they no longer need to be subsidized and can thus be legitimately be taxed, nothing would make me happier except perhaps seeing heavy pollution taxes placed on the coal and oil power generating plants.
I have long been a strong proponent of the value of decentralized energy generation. I think small scale distributed and modularized energy production under the control of local communities and small businesses has huge benefits in terms of energy security and is better in the long term for national security as well. I just happen to have a deep distrust of centralized monopolies that have one hand on the switch to my electricity and another deep inside my pockets!
My faith in PV Solar will be strengthened the very same day some major company sets up a full-scale prod_facility in the Sahara desert - using the suns own energy to churn out new solar modules with an energy leftover.... to run the societal funfair. I'm not seeing this day coming anytime soon.
The swift and crude way of looking at solar PV's future is to mentally remove fossil fuels from the picture =>> now "go ahead" : Please make PV modules!
Unless you haven't been paying attention you should have figured out by now that removing fossil fuels from the picture is not just a mere mental exercise. Unless you know something we don't.
I don't have a link handy but I know there is a company in Wales that has announced it will be making solar cells for small scale appliances and their production will be powered by wind generated electricity.
I happen to agree with your point that to make sense economically and in terms of energy inputs it would be important to be able to produce solar modules with energy produced by renewable energy. I'm not aware of any company that is planning to do this in the Sahara, though I do know of plans for large scale centralized solar facility to produce electricity to be shipped to Europe via grid. So I can think of no reason why Solar modules should not be able to be produced by using renewable energy.
Though to me that completely misses the point. That should not be used as an excuse not to implement more small scale solar on individual rooftops while we ramp up technology and build the facilities that will do what you say you'd like to see happen. I'm absolutely convinced that it will be happening sooner rather than later.
Yes, it is a Crude way of looking at it.. and I find it to be an all-too familiar and unproductive challenge to PhotoVoltaics.
If the point is supposed to be that a PV factory can somehow 'stand alone', it can't, and shouldn't .. it is tied in with supply-lines, markets, a workforce etc.., and demanding that someone set up a purist's PetrieDish out in the Desert in order to verify that it can function entirely as an Island, impervious to the events of the world is, as I said, an unproductive argument.
Clearly, if we have a 'rush' need to get ourselves set up for some severe energy constraints, and all manner of pressures on the families of our various lands, then the current need to build Solar and other things will certainly have to rely on whatever energy we can grab from the fossil fuels that are still burning, as tragic as those fires are..
It's like saying we shouldn't be developing and assembling our improvised lifeboats on the DECK of the sinking ship, that the only proof of them is if you create them out there in the water. If you have to build more of them out there, it might be good to have some built on the ship that you can work off of once you've been dunked.
Now I WOULD like to hear a more involved discussion of particular parts of our manufacturing systems today, including those for PV factories, that are thoroughly dependent directly on FF, and for which we don't seem to have a non-FF avenue available. We have looked at mining and transportation, at macroeconomics and at the Hi Temp smelting and purification in more general ways, but it would be great to get out the magnifying glass and see where there are functions in that complex chain of events and relationships that might surprise us and otherwise need to be solved when we're bobbing in the waves, while trying to breathe and remember our Mantras..
Bob
Instead of "Crude", I might have been more diplomatic and said Simplistic, and here's why I mention it.
The idea that Solar Panels are only valid if they're made with other solar panels, is like saying you should make bread using only bread as an ingredient.. or maybe that you should build your fireplace out of wood. These are rushed examples, as you can probably see.. but the point is that as we look towards a future which might force a lot of new mixing and matching, and that our power solutions are likely to be BB's and not SilverBullets, then applying such extreme euclidean cleanliness as a proof comes across as a challenge that is simply set up to fail, and yet which doesn't really disprove what it aims to..
Electricity is a very flexible power source, and so it MIGHT be able to meet much of that challenge, but it's not a guarantee.. what if natural gas is required, or methane or propane? Does Human Labor count, or waterwheels, biomass?
I just don't find the thinking in the challenge to accomplish its aim..
You are obviously failing to understand my take here.
Solar PV should "Go solo" because fossils are an increasingly unwanted and fading energy source. If PV Companies are not able to help themselves soon, they are just proving it's a wasteful effort. Remember Fossil-KWhs or calories are dwindling as we speak and never coming back.
I trust that you are willing to apply the same logic to nuclear power plants and the nuclear fuel cycle...
E. Swanson
Of course ... that logic applies to everything we like to sustain
Nuke-stations can easily spawn new nuke-stations energy wise , as for the mining op these Komatsu PC5500 electric excavators exist. So the only thing to pray for is heaps and loads of dense uranium ore.
Ok! So what do you think about this?
http://bigpondnews.com/articles/Environment/2010/06/05/Renault_to_run_ec...
I at least would find it quite ironic if it should turn out that an automobile factory can be run on almost 100% renewables yet a factory making solar panels couldn't...
Take it from me FMagyar , most of that energy is from hydroelectricity, which btw is the best kind we actually got- as long the reservoirs are full.
Mind you , Norwegian PV solar production is 100% from hydro. Not ironic at all, just plain facts.
And the problem is? Note what I actually said...
I don't have a problem with the particular mix of energy inputs into any industrial process even if those inputs are intermittent such as wind and solar. I also don't have a problem with using the still available fossil fuels or even nuclear. Even if the only way we might be able to manufacture solar panels in the future is to put those factories next to sources of hydroelectricity, and transport them to their final destination by mule train... which I find highly unlikely, BTW. What difference does it make?
As long as we continue to use use progressively less non renewable sources to produce them. Right now I have plenty of applications for my panels which are being produced with 100% fossil fuel based supply chains. The reason they are valuable now is they allow me to produce electricity without using more fossil fuels.
I guess at the end of the day based on your logic you could only use hydroelectricity from dams and turbines that were built exclusively from energy that came from hydroelectric plants. Sorry your arguments don't really hold water, my impression is that you are not interested in facts but want to be contrarian just for the sake of being contrarian.
I'm interested in doing things differently and trying to change the underlying paradigm on which BAU is based. I'll work with shovels, mules and sail powered barges if necessary. I don't have a problem with intermittent energy sources, I'm willing to use the energy when it's available. If it takes a week to concentrate enough sun for a very limited production run of something then that's how long it will take or if the wind isn't blowing strongly enough for a month, then so be it. Tough nougies, deal with it because your fossil fuel powered utopia isn't going to be here for much longer. The times they are a changing...
Thumbs up for your last paragraph ! I'm with you here.....
I know from earlier debating that questioning PV solar is a no-no.
Let's see how the PV industry handles the next downturn in the global market, shall we? The solar PV industry is at an average DOWN some 80 % as compared to the levels before the recession (from top of my head)- but the global indexes are up UP some 80 % - from the bottom that is. So what happened?
Can it tackle another 80% down in the next downslide?
I'll be back!
No, quite the contrary, debating solar is fair game!
Not sure where you are getting the data for the rest of your statement. If you could produce a link it might be helpful.
The real question is how any industry is going to handle the next downturn in the global markets or even if the global markets will even continue to exist, as we now know them, for long.
We do live in interesting times to say the least.
The drop in PV sales in '09-'10 was mainly a fluke, the result of Spain's financial woes:
The decline in PV sales isn't unique, as demand destruction due to global recession has hit many industries. But, of course, folks continue to demand a higher standard from solar :-/
Though, while PV prices have dropped dramatically during the last 2-3 (10-15) years, oil has steadily increased over time. I know,,,, apples and oranges, different standard :-/
My from "top of my head" recollection is stemming from my bi monthly browsing of the "solar indices"
Europeean side of pond here http://www.google.com/finance?q=ETR:QCE
American side of pond here http://www.google.com/finance?q=NYSE:LDK
You can change solar company by clicking one under the interactive chart, remember my claim went first and foremost for PV companies..
Now to see the "80% drop" I referred to you must slide the "time capsule"-handle in lower right corner to include 2008 , so there. Some are less bad, but some are really bad.
Can you run a solar panel factory 100% on solar power? Yes. You certainly could. But why would you want to? You'd go out of business because everyone else is using cheaper energy.
Nothing wrong with using the existing FFs to build renewable energy systems. That is probably the best use for those FFs.
If your factory is in a sunny place with high electricity tariffs it would make sense to add at least enough solar to meet the daytime energy means. But, if you want to run it 24/7, which makes sense as you want to maximize the production from your capital intensive equipment, you would want to rely of the grid for nighttime operation, as nighttime grid power is cheaper than stored solar power.
That doesn't mean you couldn't run a PV plant on solar -if say it was the only thing available, but that your return on capital invested would be reduced by doing so. Your solar only powered PV plant would probably only be about a third as productive as a 24/7 operation (again without storing the power), so it would be a highly inoptimal way to build out the resource.
Part of Paul's problem with PV may be that he is in Scandinavia (not knocking the place, I'd love to move there), and PV performance isn't going to be all that great in that climate.
Wrong! What I write is what i mean- thus where I am from doesn't enter the picture
I find it rather strange logic. But then I am not offended by PV putting energy onto the grid, and other energy being used in a different time and place to construct panels. Attached to the grid increases not decreases the value of the panels. Electricity is fungible, so what should actually matter is whether the propsed technology creates more energy output than it consumes as it input. Being purist about it is usually just used to distract people from doing that. I don't expect the world to be in imminent danger of instantly (and totally) losing all nonrenewable energy, so as a practical matter worrying about the standalone case is a distraction.
In todays global energy situation, I can agree that Solar PVs supplies Fuzzy Energy at the best.
Whether it will survive the test of time is still to be decided. Jury is out and I'm one of them. I'm just pointing PV Companies in a direction they will have to go -with or without my help.
I certainly understand your point, and I don't feel that the test you describe is the way to make the case, yay or nay, for Solar.
Why can't you put a Solar PV factory next to Niagara Falls, if you need constant heavy current-flow for the processing of Silicon.. this would support microprocessors as much as it would PV, and all of these offer us energy benefits that we will be unlikely to sacrifice willingly, knowing how versatile, portable and powerful they are..
In a way, it's the same argument as telling someone who criticizes his government that he should do their job then, if he's so great at identifying the problems.
Yes, FF are apparently on their way out.. but PV doesn't have to prove itself the way you suggest. It has to show significantly positive EROEI, and if we can get a few more steps along with the recycling, then the EROEI of recycled PV will be an interesting value to learn about as well. THAT is what tells you whether the effort is wasted or not.. as we now have CSP and PV plants well into the utility scale, what is there to prove with your challenge? Why would Fossil KWH be the ones that have to run those factories, and why not ANY of the other Electrical sources? What about setting up at a windfarm (off the coast of Maine, perhaps)
and even if they did ultimately turn out to be a one-generation tool, which they seem to have surpassed pretty well already, then their role as parts of our Lifeboats may still be absolutely invaluable. Does your solar calculator still work?
Beyond that, lets find out what parts of the processes involved CAN'T be done with anything but $80/barrel oil, and the economy that goes with it. (and THEN, let's look at the NUMEROUS specialty Hi-Test materials that are required for Nuclear Power and see how the added supply chains and complexity make that one, which is already economically slipping, stands up..)
PV is a precious, high-tech material, but it is also dead simple once built, survives in an extreme range of environments requiring almost NO maintenance, and that by anyone with some very modest training, and releasing no toxins. (And you can even use it as your roof, with a longer lifespan than any Asphalt or Probably Even Metal roofing materials!)
Ultimately you are not getting my point jokuhl, and btw Niagara falls energy is already taken .... the hydro power of this world constitute a meager 2% of total consumption and all already put to good use.
Without a hint of philosophy and progressive thinking, this is going nowhere, so let me ask this : When **exactly** is time to start to examine whether PVs actually can make PVs ?
Before or after fossils? I think this Q underscores my major takeaway point
A Sandia study from a few years back had energy payback times for crytalline PV panels at a bit under three years. (Sorry I don't have any references). Thin film, and concentrated PV has a much quicker payback -under a year. So if I take the three year payback as given I could grow my PV production capacity at a 35% annual growth rate using only the power generated by its output. We would like to expand the industry faster than that, so a faster industry buildout means PV is consuming net power. Of course we are getting better at making PV, those energy payback times are probably a lot shorter now.
A secondary issue could be economic nonlinearities. The PV plant depends upon our complex economy, pull the fossil fuels away too early, and the plant is embedded in a collapsing economy. But, that just underscores the fact that as far as society is concerned we are in a race to buildout sustainable power before the nonsustainable type fails us. So pushing the
industry growth rate beyond the energy self supporting growth rate would be a very good thing to do.
Apologies for interrupting this thread for a practical observation.
Ten years ago, in this anchorage, I would awaken to the sound of diesel engines cranking up to provide power to the fleet. Today, absolute silence. Everyone has solar panels which along with batteries, has eliminated fossil fuel use except for some minor use in clearing thru the congested harbor.
We have everything and more than ashore folks. Including computer service, refrigeration, microwave, etc. Plus watermakers, ham radio, radar, and some have electric motors for propulsion.
PV panels work very well indeed. Sailors are early adapters, perhaps because of necessity, but we can live a sensible life with low carbon use. It's merely a matter of priorities. PV just makes common sense.
If you value your independence, you should consider PV. Shave the odds in your favor.
No doubt a test facility could be set up to generate the electricity with PVs to make PVs. And so what? What then? Would it then follow that we should make PVs with PVs? No. Of course not. As said above,they should be produced in the cheapest manner possible which is currently with the use of fossil fuels.
In the mean time, PVs becoming increasingly efficient. Given this fact, there is hope that when fossil fuels are not available, then producing PVs with PVs would be viable and sustainable. For now, producing PVs with PVs, while interesting, is just a science fair project.
Further, even when fossil fuels run out or become too expensive doesn't mean there won't be circumstances when wind or hydro shouldn't be used.
Paal;
The challenge is bogus, since it presumes the world after Oil would ONLY then have PV as a power option with which to MAKE our PolySilicon, etc.. You can't say 'The power from Niagara is taken' .. it's for Sale, and if you pay the rates you can buy it, or we could find we have to prioritize certain Strategic Industries to get that power.
Unless you've seen numbers to challenge them, the NREL report showed PV to return all their invested energy in 1-3 years, and yet they still produce power beyond that for a few to several decades. The 60 year old 'first modern PV panel' in Birmingham, albeit a Selenium crystal, not silicon, still works.
Could other forces, like economics trash all or most PV mfg? Sure? But I don't think the case has been made that they are a 'waste', and we shouldn't be building them because of any resulting failure in their own basic merits. Their benefits simply have nothing to do with their ability to 'literally generate their own manufacturing power', and it's barely above a snark to suggest that they should.
.. As far as 'I've learned you can't criticize Solar PV here' goes, I'm not telling you you can't challenge them, I'm just happy to counter that your challenge had better have some merit to it. I see your question as really a rhetorical distinction, not a philosophical one.
Just cause you're getting challenged, doesn't mean you're being censored. Quite the opposite, no?
My challenge is not bogus, just preemptive to my judgment and you are absolutely free to try to run "our" demo PV plant on wind-turbines if you like- that will confine to my challenge.The renewable industry has to start these trials at some level , somewhere, sometime.
The reason I say "power from Niagara is taken" is that if PV_industry waits until hardly pressed , it simply wont happen at all.. granted you have read TOD for some time and don't have a full blown cornucopian view on things. There are time-windows for everything, once closed often hard to reopen. The "PVs make PVs"-window is open right now, because there are still some cheap energy to squander with.
The various EROEI claims for PVs like the "1 year payback-time" doesn't hit home with me. Not at all, frankly I don't believe anyone actually believe in this rubbish, do you jokhul?
On the contrary - if this was the case - PV solar would have been THE ENERGY-CONVERTER OF THIS PLANET..... for decades already, since it boarders perpetuum mobile. "Pay for 1 take 30" is a winner at the counter.Neehh..
Or say if China dedicated the TreeGorgesDam from day one to only produce PV Solar, maaaaaan, they could churn out another "TreeGorgesDam" in the shape and form of PV solar cells every single year into eternity. NOW that is what I call renewable thinking for tomorrow. Every single year - another "TreeGorgesDam" lasting for at least 30 years- what a payback for people and society, Wooow! Let's get beyond BAU and speed things up a little bit, shall we?
I know jokhul, that you know that you are right :-)
And I for one, have not slammed the door on PVs, not yet. But when I can read a fullfledged EROEI analysis on PVs that involves "everything" I probably ............
all hydro taken
Manitoba is actively marketing 4 GW, as is Newfoundland.
HydroQuebec has 25 GW of projects on file, building out 1+ GW ATM.
BC has 1 to 3 GW left to develop (depending on source).
Enough to be developed Canadian Hydro to run a large renewable industry.
And then there is 44 GW at Grand Inga.
Alan
Another alternative, erect solar PV (perhaps with some wind as well) next to a pumped storage plant (lifetime multi-centuries). Pump excess electricity up during the day and down at night.
Have enough water stored to last a few cloudy days (a little wind might help then). Reduce, but do not stop, production during the late fall, early winter months. Of course, wind tends to be winter peaking.
Alan
Alan this is (one of) the ways to go of course, to ensure 24/7 supplies for a solar-driven PV factory - just do it - thats my point!
And your hydro listings are all fine, way to go, but when it comes to the potential of addable hydro-power globally- the best case I've read so far is that a doubling is doable. Thats about it.
And I reckon this addable hydro will follow more or less the same kind of challenges that the oilbiz encounter ...... "the obvious and low-hanging fruits are all gone .."
I'd love to do it! Do you know any venture capitalists who might want to invest in such a project?
Perhaps the Chinese are already planning on just that. As much as I dislike the giant Belo Monte Hydroelectric project being built in Brazil that might also be a place to build such a plant they're certainly going to end up with quite a bit of surplus electrical energy for the foreseeable future.
Heck maybe we could ask Exxon Mobile or BP to fund it or we could siphon some money away from the Nuclear lobby.
Just curious do you think that it can't be physically done or that there is no political will or the economic risks of investing in such a plant are not worth it?
My personal gut feeling is that it will be done and probably sooner than later. I'm sure the GOP will see the value of such plants and begin a massive economic stimulus and tax exemption plan for any business willing to build these plants. I can see it now, future speaker of the House Representative John Boehner will be leading the charge for providing the necessary stimulus and incentives by removing all the tax breaks that the fossil fuel industry currently enjoys.
So Paal, can you provide us with some contacts in Norway or Scandinavia who might want to help out?
Yeah! just do it!
I'm doubtful of the idea of a 100% PV driven full production line solely based on PVs themselves , including the transport/mining op . My gut tells me this will chew too much EROEI (from an already EROEI starved process/yeah ... I know my claim only) due to the overall inefficiency in such a system ... but OTOH I may be wrong of course. Also such a system would need a functioning energy storage system which is barely on the horizon today. As Alan hints somewhere, pumped storage is probably the most promising at this stage.
Then you are suggesting some ways to go about to initiate this "PVs to PVs"-Challenge ...... well your guess is as good as mine.
I must admit to the fact that my challenge/rant is just a pipe-dream in the real world , b/c I know its not commercially feasible at this stage, as many here already have pointed out.
OTOH a national or international body (UN, EU, IEA , ....) could/should take on these kind of works today, just to double check the insurmountable energy challenges our grandkids will face down the road.
The only help from Norway at this stage is that our oil is pumped at maximum pace to cater for the next SUV coming out from an assemblyline near you.... wrrrr ....wrrrrrrroooooooooooooom!
Every generation for themselves it seems. Good hand-waving luck to the next one from me, indeed!
Paal;
For Amity's sake, I would be very happy to hear about some other analyses of the PV eroei, and I will look into the familiar claims once again, just to see where they (NREL) set their boundaries, but as I recall, they used an industry accepted set of standards to get their numbers, it wasn't handpicked for their predetermined conclusion.
Bob
I have yet to read an eroei analysis on PVs satisfying my standards- frankly they "all" - the few I've read - are mostly covering the zoomed in production itself. Little helpful IMO.
Nate Hagens had some overview a few years ago here : http://www.theoildrum.com/node/3910 , just scroll down -
Jeff Vail's concerns here Energy Payback from Photovoltaics: Problems in Calculation is the closest thing to reflect my own view and what it takes to achieve a more correct EROEI for PVs, as I see it.
Sinply put ;
All eMergy- expenditures for all people on this planet beeing part of the entire Photovoltaic- industry has to be embedded into the calculation ... eg. "if a CEO of a PV company takes a private joyride in company's Jetliner- someone better subtract that flight from the PV Eroei bill" (I know its far flung, but this is still my take)
Ergo, without the contributions of Britney Spears, Paris Hilton, WWE wrestling and NASCAR, it is impossible to build solar PV (except perhaps in China).
I find such wide boundaries ludicrous.
Best Hopes for Realism,
Alan
I know that you like to see yourself as a strategical wizard Alan, but even wizard like yourself could come to short at times...thus what you find ludicrous today , you may find yourself nodding in agreement with tomorrow. Hint: There is an eMergy ( http://en.wikipedia.org/wiki/Emergy ) for the entire world measurable up against conventional power supplies available over time .. so there. Add your own wisdom to expand to understand the future for eMergy for the "next" energysource/converter.. Good luck. Btw you forgot Donald Duck
If you like to expand your knowledge / perception on the future for PV solar, there is a FANTASTIC post on that issue up top on TOD right now. It just cements my gut feeling on that very topic.
Best hopes for "Second thoughts"
Jokukl-
"Sahara" was meant just a pseudo for a very sunny place. Alright put such a self-sufficient plant nearby Las Vegas or New Delhi or Dubai, a sunny populated place with some or most of the raw inputs nearby- are you getting me? Now try to make those PV's, but mostly (as far as technically feasible) based upon solar energy !!!
Alright let me simplify further - JUST, at least, try to run the factory itself on solar energy, let fossils do all the regular heavy duty dirty work like mining and shipping raw materials to the plant. Will it possibly work? I'M doubtful.
If -hypothetically- industrialization back in the days started up on either one of these hereunder listed energy input sources (BUT just and only one of them eg. pick one only)-
-wood
-hydro power
-coal
-oil
-natgas
-(nuclear??? I see some troubles here)
and if those were not harmful to anything and in unlimited and CHEAP supply - I can actually envision that industrialization could take a path not unlike the one we have been witnessing up until today , give or take some goodies. If combustion was not possible, there would still be alot of jolly good help in unlimited electricity as I see it.
With what I know about PV solar today I could never ever see industrialization start on that form of energy, even if the drawings where ready-made as an appendix to the Bible.Reason`? a very doubtful EROEI quotient!
After all Solar-PV's is not a new industry anymore, "it's time to grow up and stand on your(PV's) own feet", b/c it is supposed to phase out fossils due to whatever reason, no??
We've been making glass, mirrors and lenses for quite some time now. You have heard of concentrating solar collectors beaming sunlight into a focal point, right?
It gets hot enough to melt steel. Yet you just can't see the light can you?!
http://www.youtube.com/watch?v=8tt7RG3UR4c
Sorry to disappoint you again FMagyar- Solar Heat is one of my favorite sustainable converters for the future. Hurrah!
Why? It is doable and it works. A "large cheap" collecting area and a "small expensive" focal/generating area. Great news! But not for PVs which is a "large expensive" area.. only. And it's not getting (much) cheaper by size either. I can imagine CSE being able to replicate themselves , under the sun. Silver paper can be made quite thin and not least: cheaply-
"Great news! But not for PVs which is a "large expensive" area.. only. And it's not getting (much) cheaper by size either."
I just ordered top quality polys for a neighbor for about 40% the price/watt I paid for one of my arrays 5 years ago. They also are speced at about 13% more efficient.
I've been listening to folks apply a different, more stringent standard to PV for all of the 15+ years I've been living (and running a business) on it. I usually don't waste my time on these people since their bias is complete, though irrational.
Yep, I'm seeing the same thing. 13% more efficient It may not seem like a big deal to the uninitiated but given the drop in prices it really is!
He was looking at the Sunpower T5-SPR-318E, 16.68% efficiency, but he had plenty of roof space and opted for Kyocera's. I got him a great price on a pallet of 20 (less than $2.50/watt). Nice panels for 25% less/watt.
PV supply is a bit tight right now, especially in 235/250 watt size, which makes the most sense if you goal is max kWh for the buck. This is an optimum size since they are under 50 lbs and is largest to be carried by hand on a roof as per OSHA. "Good quality" Chinese panels by the pallet are < $2.00 watt wholesale. It's amazing how fast PV production is ramping up in China. Perhaps faster than a Manhattan project would do in the US if oil was > $150 Barrel. China is dead serious about producing gigawatts of PV. At the Solar Power International show last month, If you had days, you could not track all the new the etchings on state of the art 5" and 6" wafers in modules. With a few exceptions, most modules look the same now.
SEIA's goal is 10 Gigawatt/year installed rate in US by 2015.
Aggressive and this short term goal will is achievable.
http://www.seia.org/cs/news_detail?pressrelease.id=1063
What better use for today's cheap oil, Remember those lucky one who locked in bonds in the 70's.
Link to the Kyoceras please. I'm looking for panels and tracker
http://www.affordable-solar.com/kyocera-KD235GX-LPB-235-watt-solar-panel...
They came off of this price when we ordered BOS stuff from them. Don't be afraid to dicker with these guys. Great bunch!
Melting steel is nothing. Let's melt granite: http://goo.gl/re4Ef
Thanks, Admiral!
That's fun!
We young fools made a 1 meter diameter parabolic by "mirroring" an X-Band radar dish (meant for 10GHz microwaves) in the 70's: A spiral was cut from metalized Mylar sheet-stock (art supply store). An ohm-meter was used to make sure the metalization faced the sun, not the Mylar plastic. The spiral was laid into the dish onto a weak adhesive: Scotch-77 Spraymount. The focus was 3/8ths of an inch or so. If you swept your hand through it, it would leave a wisp of smoke. An aluminum soda can would light afire with a "Pop!". The surface of dirt-clogs could be melted. In fact, any rock picked-up from the desert floor could be melted, even quartz, which was most impressive. It would put a hole through a red earthenware flowerpot in about a minute. The area would glow, and then slump away, the surround having melted to a black glass. The action was viewed through two #10 welding filters stacked together.
Even though a PV cell is getting energy through literally "One Rock", I don't understand why you keep framing this argument with PV as a Monolith. It is a very useful energy source (or converter, really) ..
But this issue of yours to sort of debunk it since it 'can't start up an industrial society', and you press that it 'ought to be powering the factory that built it'.. It isn't alone in the Renewables Field, and it doesn't have to Prime the Pump for a whole new industrial society, all on its own. This is just as bogus a challenge as the "Renewables won't maintain BAU" .. That's NOT their job and it's not the premise, even if some dreamy knuckleheads might have that fantasy..
We just saw a story linked about some 30 year old Arco panels that were retested on a lark, and they had output ABOVE their original factory spec... so I'm not sure why you think it can't stand on its own feet, Energy Wise.. Once it's not trying to stand while being repeatedly tripped up by cheap oil, hostile Sauds and IOC CEO's, you might be finally convinced.. but if you've waited that long, the chance might be gone. I'd find a more salient test if I were you.
"My faith in PV Solar will be strengthened the very same day some major company sets up a full-scale prod_facility in the Sahara desert - using the suns own energy to churn out new solar modules with an energy leftover.... to run the societal funfair. I'm not seeing this day coming anytime soon."
The "Night problem" is a real issue. If you throw in enough batteries to get through it the cost advantage goes away. The module assembly plants probably can shutdown for the night, but the "heavy" processes up front, whether it's the chemical refining for the silicon production or the smelters for the CIGS or CdS production is 24/7. Where I work it's three days to start the plant, and another week after that to get it settled down at full rates. It won't be coasting through the night on batteries.
On the other hand, the local power grid supplies a lot more than us. If half of that load could adapt to peak solar hours, PV would do a lot of good. Just abandon daylight savings time so the sun is actually up an hour before work starts ( instead of an hour later, like this week) and you could make a dent.
Don, I went back to see if you had replied to my post several days ago and you had. I'll respond here so hopefully you see it.
You had said:
To which I replied:
You then replied:
That's a good scenario to ponder because to my mind there is a better than even chance that we'll experience such a depression. In that case, Hirsch has calculated the following for his model:
If a 1 MM bpd saving provides 3 weeks, then your 20% reduction would provide:
20% x 86 = 17.2
17.2 x 3 = 52 weeks
Or about one year.
Now, his presentation doesn't say the decline rate he is using but someone could calculate it if they wanted.
In any case, I just don't see us getting 10 years of grace period if we enter a massive depression. My guess is the best we get is perhaps two years on the outside.
Please don't do this. Reply in the thread where the discussion arose. Especially if explaining it means quoting a big huge chunk of other people's comments.
Leanan;
I would like to figure out ways to let a conversation continue without it becoming a burden on the Editors or bandwidth.. but it seems like a thoughtful extended conversation becomes impossible, since a point made a couple days back is quickly 'dead material'.. it won't get any more eyes on it, so no matter how good or useful the thinking is that's going in to it, it is neutered, and this seems to leave us in that situation where we keep restarting and rehashing some of the same conversations over and over.
I do think these issues/discussions are developing gradually anyway, as the regular posters seem to keep the 'running ideas' moving forward.. but the inability to have that kind of continuity is a recurring frustration to me. It's not just TOD, of course, much of the internet is far worse for having productive discourse.. but it feels like an area that is ready for some new approaches to build some 'farther back/ farther forward' depth in the way a topic can grow on an established and hard-fought background..
Just a thought.
Bob Fiske
Some sites allow threaded bulletin boards where any member can post a new thread topic. eg.
www.powerswitch.org.uk
This has its pros and cons. It allows threads to last days or years, but also leads the thread explosions, long running trolling and
spam attacks.
Maybe a separate area could be set up within TOD for such posting, where select (?) members could be allowed to start new threads than spin off from general discussion.
Yes, there are peak oil message boards. Notably PeakOil.com and the late lamented LATOC.
We did consider forums at one point, but they're a lot of work to moderate, and we kind of felt we'd be re-inventing the wheel. There are already peak oil forums, so why not use them instead of starting a new one?
Personally, I find the message board format less useful than you'd think. If the mods are aggressive and round up all similar posts into one thread, it quickly becomes cumbersome. It's impossible to read a thread 1000 pages long, and searching it doesn't work well, either. If the mods don't round up the threads, the discussion is going on in 12 different threads and 5 different forums. Either way, it's difficult to follow the discussion or look it up later.
As for "selecting" members...we've considered that, too, but for now it's a can of worms we'd rather not open.
All aangel had to do was include a back link like this one:
aangel on November 1, 2010 - 8:21pm
For those here who do not know how to do that, click on the user's name (account), pick recent Comments, find the correct comment and use its Premalink as the link back data (copy link location)
LATOC is no more??
Anyone know what Matt is up to?
Hunkered down in his doomstead?
LATOC is still up and running.
However, Matt decided to close the forums. (I believe there's an alternate board or two being set up by interested parties.)
Despite speculation that Matt was bugging out because of imminent apocalypse, it sounds to me like he just got sick and tired of the hassle of moderating the forums.
What are the alternate boards being set up?
I think it's here:
http://sustainablecountry.com/
I was a mod on Timebomb2000 until I said TOD was a better forum for energy issues and the owner of the forum banned me. Look, being a mod is a PITA in so many ways...you have to look at stuff you aren't interested in to be sure they are in line with forum rules. And, you have to do it on a regular basis whether you want to or not. Then there is the questionable stuff where you go to the mod forum to debate what to do. TB2K banned people who reposted "secret" stuff but they were truly valuable contributors and they were lost forever; typically to their own blogs or forums. But, hell, they violated the rules so ban them.
TOD does not want to have a moderated forum. Yes, stuff and continuity is lost. Too bad.
One poster a few days ago mentioned another forum but a lot have gone to http://www.thetreeofliberty.com. Interestingly, I also note some old TB2K people there too.
Todd
PS Both TOL and TB2K have undergone DOS attacks recently.
Re-hashing the same discussions over and over is what I'm trying to avoid. Leaving the discussion where it started lets those who are interested continue, while others can move on.
As you note, the same topics tend to arise over and over, naturally. There will always be another chance to make your point to new eyes.
I am with you Bob. There should be a way to continue interesting threads that have relevance to peak oil and/or other subjects that are discussed on Drumbeats.
However I agree with Leanan in that arguments should not be carried over. After four or five posts arguments become redundant with the same of flak being repeated over and over.
Ron P.
One of the only approaches I've been able to come up with myself is typically labor-intensive, and would amount to a form of 'Community Service' or Homework, by us member/posters.. getting folks to volunteer to do 'Topic Work' for whatever, a half hour a week or something, and gradually create some pages of consolidated info, maybe lightly derived from the WIKI format, which would entail searching for keywords and adding to the homepage on 'AIRDALE's WISDOM', or 'ELECTRIC CARS, PRO/CON'
.. but instead of just glomming on the thousands of 'somewhat related' posts, it would be the job of editing and consolidating the key bits of (subjectively) useful information, and structuring/pruning that page as the process goes forward, to keep it sensible and managable. Maybe the DRUMBEAT format would be useful for such a thing, a Header and a snippet.
And of course, 'Who bells the cat' (Obviously, 'The cat bells for thee!!)
- Ask not what your TOD can do for you, ask what you can do for your TOD!
Bob
Software forums are a better structure for managing discussions than comments to a blog entry.
Fact: Drupal has and has had forum software for several years.
Fact: Drupal forum software is enabled by default, meaning it takes a deliberate act to turn it off.
That TOD chooses not to utilize such a resource is clearly TOD's choice. It's not that they cannot make user discussions more persistent, visible, and participatory but rather that they deliberately have chosen to not do this. Draw your own conclusions.
On the other hand, this "comments" format allows one to browse through random material and "stumble" upon interesting stuff you might not have otherwise seen.
Each approach has its pluses and minuses.
I actually really like this interface for keeping a visual sense of a day or three's conversations.. but I don't know if the Forum approach is really what I'm thinking of for this idea above.. I'm thinking of a way to consolidate the 'thinking', once the conversations are done. The WIKI sort of makes sense to me for this sort of 'Uber-FAQ' of evolving knowledge, but even that I think has some unexplored avenues for putting the ideas and the links to connected topics in a 'Hyper Useful' form..
but hey.. I can't even offer it up myself.. it's still a fairly hazy ideal that I think is just out there, beyond reach.
Dream, baby, Dream!
Hi, Leanan. Happy to oblige. In this case I did hope to involve more people in the discussion since it's the first time Hirsch's graph has come up thus I thought some new ground was being broken.
Nonetheless, I understand how you want to run the DB and I think you do a good job so I'm happy to defer to your wisdom.
I shall reply to this comment on the Nov. 1 Drumbeat below your last comment there.
I have been a daily TOD reader since nearly day one although hardly ever post. Regarding the US election results of yesterday, it appears to me the political system has entered an oscillation mode that is unstable and potentially disastrous. The 2006, 2008 and now 2010 swings reflect, IMO, a public passing from concern to fear and now anger. Panic will be next. As the public realizes that neither party offers a solution to the trifecta of peak oil, global economic crisis and climate change, there is a potential for disastrous political outcomes.
The US electorate seems to be mirroring the anger and discontent being exhibited in the streets of France, Greece etc. The US political system is one of the most stable among developed countries. If the wheels fly off here it is a very bad sign. I have had difficulty accepting the idea advanced by some here that democracy may perish in the not too distant future under the stress of our unfolding crises. Now I am not so sure.
One problem with the rapid, wild swings in election results is that fashioning any coherent strategy to deal with the crises becomes, for all practical purposes, impossible. In the end, the political paralysis may foster the fast crash that I thought was unlikely. Interesting times, as they say.
I've referred to the election as a "Partial replacement of the officers on the Titanic" (after we hit the iceberg). In any case, the partial change in leadership would seem to make bailouts of local governments less likely. Here in Texas we are reportedly facing as much as a 25% projected state budget deficit over the next two year period (as Tom Brokaw said about the 2008 election, the winners should have demanded an immediate recount).
In any case, I was reading about efforts by Texas school districts to reform the school funding system, and I read that the Birdville School District (a small well regarded North Texas school district) was only able to approximately balance their budget because of $10 million in stimulus money. I was curious as to what percentage of the budget this was. It appears to be about 5%. Here is a PDF file for the Birdville budget (the summary is on page 14):
http://www.birdville.k12.tx.us/departments/business/BudgetReports/2010-2...
Total Birdvill spending is projected to be about $200 million for 2010-2011. I astonished at how much funding comes from outside the district, about 50%. In looking over the budget summary, where would one start cutting to meet a 10%, 20%, etc. funding shortfall? And then multiply this one example across the whole country to other school districts, cities, counties and states. Dividing an expanding economic pie is tough enough, but dividing a shrinking economic pie is going to be an ongoing bloody battle, especially given the high percentage of relatively fixed expenditures that local and state governments must fund.
But we haven't hit the iceberg yet - it's looming just ahead. If oil production decline occurs before the 2012 - or if oil prices are triple digits - there will be real electoral upheaval.
I'm guessing you haven't read much of our net export stuff. An introduction:
http://www.energybulletin.net/stories/2010-10-18/peak-oil-versus-peak-ex...
And annual global crude oil production has, so far, been at or below the 2005 rate for four years and for 2010 to date (EIA).
Yes, I've read the net export material - good stuff. However, evidently there is still excess oil producing capacity. We'll hit the iceberg when oil production is not able stop declining even with over $100 oil.
Tapis $94.95 per barrel according to http://www.upstreamonline.com/marketdata/markets_crude.htm
Louisiana Sweet $87.12
The average annual oil price in 2008 was $100, but BP data show a slight decline in global net oil exports, from the 2005/2006 level. In any case, here is a summary of our #2 Scenario, from the linked EB (ASPO) article:
To the extent there is some excess capacity, I suspect that it mostly consists of what Matt Simmmons called "Oil stained brine."
We've hit the iceberg.
The buoyancy lowering sea waters are rushing into our ship's compartments.
The back room engineers (i.e. Fed. Reserve) are desperately trying to seal off the compartments (i.e. let Lehman die so that AIG might live) as the buoyancy of our economy continues to drop.
The captain (President) and engineers (the Fed) still do not understand that peak oil cuts a gash across the whole broadside of our good ship, the USS Atlas-Shruggin Capitalism and thus breaches all compartments at once.
We're sinking and yet we still don't know it.
(Has any one sent an SOS Morse code message to Mars? Maybe Rover will hear it and come rescue us.)
[ i.mage.+]
_____________________________
[i]= image, [+]= more info
There's a new book out about the Titanic, written by a descendant of one of the officers. She says that the iceberg was spotted in time, and the crash could have been avoided. The main problem was that a transition from sailing ships to steam was going on at the time, and you had to turn the wheel opposite on a steam ship than you would on a sailing ship. The steersman, used to sailing ships, turned the wheel the wrong way.
Not sure what this means for our favorite analogy. Hmmm. The captain ordered the ship left, but the guy at the wheel screwed up and went right instead, causing the fatal crash. Or...the deadly mistake was doing what used to work before?
The analogy of a sinkable "unsinkable" ship still holds water
But the idea of turning the wheel the opposite direction of where you like to go pi?¤#¤%¤es me off. Someones great grand kids should be kicked in their buttz :-)
I think that fits perfectly with our situation Leanan.
We've had Chaos at the helm of the USS Titanic for two or three decades and they just keep on making more mistakes as we scrape along the IceBurg of reality.
Sounds like it still fits,
"Iceberg, right ahead! .. Steersman, DRILL, DRILL, DRILL!"
An even better analogy! The US public is trying to steer, right then left, but the ship keeps right on sailing towards the iceberg anyway.
Too bad we didn't have a far superior piece of engineering to work with from the get go.
Actually it resembles a mutiny on the Titanic with the newly minted Teabag Republicans plotting a circular course as we drift into a field of icebergs.
We need to be calm in the face of the Decline and Fall of the USA.
As Gibbon observed,
http://www.youtube.com/watch?v=qNi1sevKNd0
You haven't been paying attention (don't feel bad, most people haven't, it's an obscure topic). This is typical for almost all states. Local property taxes began to be insufficient to fund schools at least 30 years ago. Rather than give the districts the authority to levy alternatives -- sales or income taxes -- most states chose to have the state government make up the difference out of state-level sales or income tax revenues. This often began as an "equalization" program to help poor districts keep up. But even rich districts get large outside funding now.
About 43% of the Texas state budget goes to K-12 education. Across states, anything in the range of 40-45% of the state budget is typical. Increasingly, states have been receiving federal dollars to supplement their own tax revenues. Some of the reason for that reflects the realities of tax rates at state and federal levels: state governments can't get away with a 35% top marginal income-tax rate. For the most part, those funds are funneled through the state government, as the feds dislike dealing with thousands of individual districts.
This raises a considerable concern about "local control" arguments that have justified the continued existence of local school boards. If more than half the money is coming from outside the district, why do we bother with elected local officials? Let the state government appoint a professional to run the district to state standards. Here in Colorado, the school districts who squawk the loudest about "local control" are often the ones with the largest percentage of funding from outside the district.
And Texas is facing a projected 25% budget deficit (and Perry is apparently determined to avoid a tax increase).
I think that my description of trying to divide a shrinking economic pie as an "Ongoing bloody battle" was too optimistic.
Other states are even worse off. Today the Wall Street Journal praises Texas as a fiscally conservative state "How will taxpayers from fiscally conservative states like Texas or Nebraska feel about bailing out threadbare Illinois or California?"
http://online.wsj.com/article/SB1000142405270230417370457557820388740807...
State constitutions provide additional interesting twists. In Colorado, the constitution actually sets a minimum level of per-student funding, with annual increases, so much of the K-12 education budget is off limits to cuts. Texas has a constitutional requirement that the state provide an "efficient" system of free public schools. There's a bunch of Texas case law about what "efficient" means, and at least one of them includes equity across rich and poor districts. Cuts to basic per-student funding may see court challenges that the system is no longer "efficient" in some fashion.
Y'all can work the numbers; if a 25% overall cut has to come from the 57% of the General Fund budget that's not K-12 schools, it means wiping out a lot of things. I've written here before, and continue to stand by it, that this recession has simply sped-up the slow-motion state budget disaster that is Medicaid. States are likely to have to choose between the programs that have been their responsibility in the long term -- public schools and universities, roads, police and prisons -- and health care for their poor citizens.
Before anyone jumps on me for being a heartless old curmudgeon... I'm not opposed to providing health care for the poor, I'm simply saying that Medicaid as currently constituted, with states responsible for half (in most cases) of the costs of a counter-cyclical entitlement program whose costs are growing faster than state revenue bases, is not a workable way to do it. Even 20 years ago, the numbers said it: inevitably, Medicaid would begin to crowd out funding for traditional state functions.
Rearranging the chairs in the Pilot's House on the Titanic.
Good one.
When I voted for Obama, I mistakenly believed that his youth and quick wittedness would allow him to grasp the situation.
But disappointedly, all we have seen are boiler plate speeches from the same teleprompter that fed GWB his talking points. Bohner (new expected speaker of the House) uses the same teleprompter.
Watching his appearance on The Daily Show it struck me that he seemed frustrated that he couldn't really speak his mind and agreed with Stewart that perhaps the current form of government isn't nimble enough to respond to the problems. He also said curiously there were things being done in secret but did not elaborate.
Reading between the lines I think he basically said that he'd had to hold his nose and keep some of the old-guard economic team because he really had no option at that time in his opinion. "Heck of a job Summers" perhaps tells us what he really thinks given the previous association of a president and that "praise".
I have some serious disappointments with Democrats, Inc. as well.. but I'm really not convinced that the two parties are quite as identical as all that.. and particularly the new Speaker-elect.
This is going to be interesting.
Ah, to be blessed with a life during interesting times, that we are; yes.
Boehner has all the earmarks of a simple headed country bumpkin.
Don't try to confusinate him with any of that science stuff,
After all: carbon dioxide (CO2) is just a natural waiting to exhale kind of thing.
____________________________
See here for ABC News interview with Boehner re Climate Change
Yes, newly elected officials bring fresh energy, views, and desires.
...but...
The non-elected personnel, the Wormtongues if you will, do not swap out. They are still there. Same with all the lobbyists.
brownback was elected here in Kansas. some rumors are floating around that to balance the state budge he will be axing entire departments of the state.
We got Walker here in Wisconsin, who beat out the mayor of Milwaukee. The guy is determined to kill the high speed rail project here. The Republicans have a lot of control in this state now, so we shall see what happens.
Texas voted for its own demise. And who will they blame next?
Tstreet, do you want to clarify your statement? I live in Texas, and we voted for the same corrupt moron we've had for ten years. Holy crap, Perry has been in office since I was still in college. I think he may be governor after I'm dead - he isn't aging, hes just getting dry and shrinking slightly like a well made mummy.
The one silver lining of the wheels flying off sooner than later is that it may keep us from actually going over the cliff at full throttle. I sometimes wonder if that hasn't been the plan all along. The wheels come off, the train derails and though a lot of people get hurt in the wreckage it's still not as bad as what would happen if we go over the edge into the abyss.
Of course our good friend, Alan, is going to have a lot of new track laying to do and we have some electric locomotives that are going to need building too.
Best hopes for the wheels coming off before it is too late!
Oh, and no, I don't really believe there has ever been a plan maybe we'll get one now.
Well put TP. You should post more often. I don't try to predict much especially future actions of our fellow citizens. So far TPTB of both parties have for the most part ignored the problems you highlight. Perhaps the simple motivation of survival will change the political landscape enough that those issues begin to be addressed seriously. But that assumes the public will demand more than just "throwing those bastards out" as a knee jerk reaction but listen to reasonable solutions presented by reasonable people. On that point I can't say I'm filled with enthusiasm. Might be easier for them to just blame them damn Arabs and thus look for a military solution. Perhaps I'm being harsh but we've all seen mob metality kick in during less drastic circumstances. I still clearly remember seeing a video of a fellow beating another with a tire iron for cutting into a gas line back in the late 70's. Granted a few idiots do not make a national mob. But....
Centrifugal bumble-puppy and electromagnetic golf hardware upgrades will placate the masses. Soma all around. Give me an IPOD that will hold 7e06 tunes.
Damn the production full speed ahead.
FF
I disagree that the election results mean much with regard to the political system. It's pretty clear to me that the two are quite disconnected - regardless of who is in power the functioning and policies of the government almost indistinguishable. There have been periods when the differences between the parties were greater and more meaningful, and times when they were not, and right now they are minuscule.
In a sense the US system is stable because it is insulated from the will of the people. The people are frustrated, and keep trying to use the only lever they've been given, and which they have been taught from birth is somehow possessed of mighty powers, but it isn't connected to anything - its just a stage prop. I suppose eventually enough people will give up on that exercise and try other means to effect change, and that will be when the wheels fall off.
TP, watch my talk at this year's ASPO conference to begin to understand how democracy will be replaced:
http://www.postpeakliving.com/aspo-2010-talk
Say, hadn't seen that, excellent.
yeah...thanks for linking that, Andre. And thanks for the comment, green, got me to watch it and send it off to a few others.
cheers
-Dave
Andre,
I assume you refer to page 13 of your PDF transcript, right?
I vote for prediction number 3: Roll back of the Enlightenment and return to Medieval Thinking
Tuesday's election results in the USA were a sign that the Roll Back has begun
_______________
p.s. Thanks for making all your materials available at your site
greenish, dr_dr and sb, you're very welcome.
And yes, the roll back of the Enlightenment has begun. I expect several U.S. states will be effectively theocracies by 2025, possibly sooner. The Southern states will probably become theocracies first.
It's an open question whether the entire U.S. will become one or if some states will hold out. If that happens, it's conceivable the U.S. has another civil war between those who will stand for open religion and those who will try to make everyone a Christian.
A sci-fi book I read recently predicted a red state-based nation referred to from outside as Jesusland.
J_ H Christ! I better check the map to see which side of the border my house lands in.
Holy smokes aside, I'd prefer to be in MaryJane Land any day over being trapped inside JesusLand.
Are there any other options?
What other Lands and KingdomComes can I join?
[i.mage.+]
One of my thoughts is that our increasingly short attention spans and expectations of instant gratification in the U.S. are leading to the rapid swings in political power. It's the "If TPTB can't fix things in 6 - 12 months then throw 'em out" mentality. I'm begining to think that our only hope is that the DoD will take over, start handing out shovels and say "shut up and start digging". I hate to think that it will come down to that but the cluelessness and denial out there among the average citizenry is truly amazing. Interesting times indeed.
oh dear , that means digging their hole before they're shot ?
thats the history lesson I learnt
Forbin
While there are certainly think-tank types within the DOD that understand our predicament, I think we have no assurances, and in fact it's unlikely, that in the case of a military takeover these people would have any influence. What we're likely to get is a clique of generals who institute a secret police, round up activist intellecutals, educators, lawyers, judges, and media people, and decide to invade Iran or Venezuela. Possibly the military clique will then itself split, with different factions fighting it out. Think Chile or Argentina under military control - that's my guess.
That's one possibility. But my main point was that in a crisis situation the military can act quickly and decisively while our political system no longer seems capable of this. In a world war situation they can act quickly but how do you convince the masses that the current conditions are that urgent? So far those trying to sound the alarm are not having much success.
Yes, the military can act quickly. That's because a military organization is the ultimate socialist organization, with strict hierarchical command and control and stiff penalties for failing to follow orders. Those characteristics are necessary for fighting in a life or death battle where the enemy is clearly defined. Then too, the military has only limited capacity to act outside their area of specialization, which is, to apply the necessary force to defeat an enemy, up to and including bombing cities with nuclear weapons. However, those same characteristics are anti-democratic and thus not the sort of system which the average person in a democratic society should willingly accept. In other nations, such as were in power in pre-WW I Europe, the ability to the military to control the public resulted in several totalitarian governments after that major conflict. And, that path also resulted the larger conflicts, WW II and the Cold War.
During the runup to the election in the US, the Tea Party types called for less government, meaning less regulation and less control of individual actions by the government. Strangely, we saw a call for a stronger military, which would appear to be the opposite of the goal of a reduction in the size of Government. One can only hope that with all of today's posturing about reducing the size of the Federal Government, the size of the military would also be included, but I'm not holding my breath for that one...
E. Swanson
None of the characteristics you described of the military could be remotely considered "socialistic". The military is, internally, a strict dictatorship with power of life and death over the inmates.
Your points about the relative effectiveness of the military versus current political system, in terms of implementing decisive, neccessary changes, are well-taken. I don't know what the answer is. I guess my point is that we shouldn't pin a false hope on the US military being a benevolent force for positive changes if said military becomes the default political power in the US.
I cannot believe that more and more people on TOD lately have been advocating for a military coup in the U.S.
Snap out of people!
What in the world are you thinking?
You are dancing on the graves of all the patriots who fought and died for the Constitution.
If you want to give up, please consider moving to another country rather than even passively advocating for a military coup.
Step away from the ledge and think clearly...for shame! You start to feel the least bit of reduction in economic quality of life and hope for the future and your answer is a military authoritarian regime?
Jefferson is spinning in his grave.
Thank you Heisenberg for trying to wake those who expect our energy/economic problems to be solved by the military. Our true strength arises when the people are made aware of the dire situation. Only then will they realize the need for action.
Unfortunately, we act like mules and need a to be hit in the head with a 2x4 before we will pay attention. Predictions of hard times are always ignored. Hard times, when they first arrive, are thought to be temporary. But desperate times will lead to desperate measures, and those are what is needed.
Our moments of greatness as a nation have come after great hardships.
We must prepare for what may come, but please let no one urge a military takeover. This country has already been through one civil war, may there never be another. Yes, there are terrible times ahead. What we need is for the country to become aware of the real problems, only then will real solutions be considered. We will eventually learn to survive at a much lower consumption level. This process will take many years. We must have patience.
Sorry.
Lemmings don't do that during a panic stampede.
____________________________
But now you know one of the intended meanings of my moniker (heh heh)
[i.mage.+]
Perhaps it is in response
to the numerous assertions
that the only way to escape being led over a cliff...
is to take up arms.
It is exploring the choices among types of chaos.
I like the cooperative Cuban, Russian, or Venezuelan peasant solutions.
America has alienation, racial and religious polarization, the morality that issues from video-games, and a culture of violence.
Rational leadership for the good of the people would be... nice.
Spinning, you say... with what kind of torque-moment?
Well, who can argue with the ghost of Thomas Jefferson?
The ghost of John Adams?
Yeah, my comment after the elections is that nothing will get accomplished in the next two years except those corporate giveaways that both parties can agree on. Certainly no real work towards mitigating the " trifecta of peak oil, global economic crisis and climate change," as you nicely put it, and probably no end to the war in Afghanistan.
The disasterous political outcome you fear I fear as well. Assuming the Republicans get control of the Federal government in 2012, my guess is that by 2016 people will in panic mode.
I do not think we'll be in panic mode by 2016 even if we're in a long-lasting and severe deflationary depression, but I could be wrong about this. By 2020 I think the panic mode will be there with sharply reduced oil imports and gasoline rationing. My speculation is that the 2020 election will be the last real election for President in the U.S. Democracy will be perceived to have failed.
What kind of dictatorship we get is anybody's guess, as I mentioned in some of my comments on the Nov. 1 Drumbeat. Americans like to elect victorious generals to be President, but we have not had any victorious generals lately, and we may not have any during the next ten years.
Our republic has failed. My guess is that it will be replaced by a single dictator rather than an oligarchy, some charismatic individual that people will look to as a savior to bring back the good old days.
Well, even a dictator can't change the Laws of Physics. Not to forget, the US population have a large store of arms and tradition of fighting those who would attack them. Also, there's a relatively a small number of front line soldiers in the military. For a dictator to take control, I submit that there might be some form of popular rebellion, which might result in street fighting in the cities and gorilla fighters hiding in the countryside sniping at anyone thought to be one of the "Feds". There's already places around here where the firefighters and police won't go and it's been that way for decades...
E. Swanson
The comments lately about military takeovers and dictators and what-not are getting a bit ahead of themselves, I think. I don't know what the future holds in any such detail and I don't think anyone else does either.
The U.S. military is already overextended and has been right from the get go. This is why our armed forces have been so reliant (over reliant) upon non-military contractors; Halliburton, Blackwater, etc.
The thought that they have the capacity to just "take over" the whole U.S. (pop. over 300,000,000) is stretching things a bit. Hell, they can't even "take over" a third world country like Iraq or Afghanistan.
There was also a comment on a previous thread comparing the situation in the U.S to the situation in Stalinist Soviet Union during the thirties and Stalin's ability to basically steal the food production from the Ukraine. Give me a break; there are NO comparisons, NONE!
I'd like to see the discussion kept more sensible I guess is what I'm saying. Not meaning to be patronizingly critical, nor meaning to single anyone out specifically, just let's think about some of this stuff before posting is all.
Things will probably calm down a bit as the election retreats into the rear view mirror.
There were a lot of dramatic posts around the previous elections, too. Many were convinced that Bush would never leave office; he would overthrow the Constitution and make himself president for life rather than let a Democrat take over the Oval Office. Some boldly predicted that the 2008 election would not happen; an "October surprise" would allow Bush to declare Martial Law.
Instead, the election went off as usual. Bush retired, moved to Dallas, and is often spotted with his wife sitting behind home plate at Rangers games.
Whatever Bush's many failings, he wasn't stupid enough to want to stay in office.
WT, I generally agree with you on most everything but here we must disagree. It was not Bush's intelligence, of lack of it that kept him from staying in office. It was the Twenty-second Amendment to the United States Constitution that limits the president to two terms.
Ron P.
The premise of course was that Bush would declare martial law, and stay in office (see Leanan' post). At the time that the theory was circulating, I opined that the last thing in the world that Bush wanted to do was to stay in office.
Aha. So we had bipartisan agreement on that point.
See?
He really was "the Uniter" --as promised.
The Supreme Court ruling in Citizens United means that Wall St money can control who can and can not run for office. By only allowing candidates who would let the military decide what happens then a cabal of Generals and institutional investment managers plus perhaps the Federal Reserve then a dictatorship with the appearance of free elections is likely. Media companies which don't go along will lose 100% of their sponsors and quickly go out of business like many of the nation's newspapers already have. Anyone who attempts to challenge them could easily be labeled a terrorist and turned over to some rural prison run by a corporation.
We currently have seen in yesterday's election that we were sold the idea that a tweak here or there will restore us to permanent prosperity. We are in an age of declining resources with an expanding population which means serious changes need to be made. As the economy struggles through the next 2 years we will see more and more voters giving up on the agenda of either party.
That depends. These folks believe in a thing called full spectrum dominance. What they mean by FSD, is not that they have to shut down contrary sources of information, only that it is irrelevant what contrary actors do, the message pushed by the PTB will be sufficent to fool enough of the people anyway. It's a slightly weaker form of control, but it can get the job done.
Which reminds me of my favourite spooky logo
It's either hoovering up info across the planet or firing a masonic death-ray :)
Gee ..
I thought it was merely the all-seeing eye of the Illuminati (a.k.a. Free Masons and the New World Order Committee)
It's a rube's game, even for the Dictators..
"You never HAD control, THAT's the illusion!" -Dr Ellie Satler, Jurassic Park
"Neither you, Simon, nor the Fifty Thousand;
Nor the Romans, nor the Jews,
Nor Judas nor the Twelve,
Nor the Priests nor the Scribes
Nor Doomed Jerusalem itself..
Understand what Power is,
Understand what Glory is,
Understand at all... understand at all. " - Jesus Christ Superstar
..in Mordor, where the Shadows lie. - JRR Tolkien
twinpeaks:
The best we can hope for at this point is some sort of benign military rule.
The liberals here (of which I am one) may wring their hands at such a thought, but the military is mostly competent, with considerable class/ethnic diversity, and I doubt they have any real desire to turn their weapons on their fellow Americans.
Unfortunately you can't say the same for the Wall Street oligarchs. They actually get kicks out of inflating our currency, putting us deep into debt, and profiting when the pyramid schemes collapse. They quite literally joke about it.
The is the big failure of the liberals of our times...they understandably get worked up about war, health care, race, environment, this or that, and they refuse to pull back the curtain and look at money.
Liberals have never advocated sound money - instead, they get their funding and coddle up to the debt-pushing oligarchs. Good riddance!
If by liberals you mean their chief political instrument the Democratic party; they have discovered they need the money and organization of the oligarchs, else they won't be able to compete in our media dominated elections. So they are forced to compromise their principles, which makes them look weak and indecisive. So the Oligarchs prefer Republican's, but spread the money to the other party both as a hedge, and as a means to corrupt them. Operation Oligarchy-Genesis seems to be proceeding on or ahead of schedule!
Your reference to "sound money" sounds a bit religious to me. Some faction of society wants to think they can save cash in a mattress and not have its value decay with time. Other technocrats view money as a tool for getting society to meet its goals. In the technocratic analysis there is a tradeoff between the inflation rate and unemployment, so they would prefer a moderate level of inflation, because it improves the economic performance of the system. Thinking of the economy in terms of a "morality play" rather than as a technical means for organizing societal production is probably the biggest cognitive mistake on display in the world today. The harm caused by such thinking is immense.
And yet this principle seems to apply only selectively. So does it apply equally to the constant whining we get from the left about levels of inequality, as measured say by the Gini coefficient? How is it that it's long been OK to think of the economy as a morality play when it comes to looting those who work and save, for the benefit of lazy social parasites, but it's not OK when it comes to rewarding the work and saving that allow said parasites even to survive? I'm thinking here, say, of Paul Krugman's recently expressed desire to ramp up the inflation rate, i.e. to loot retirees in a repeat of the 1970s.
Sounds like some pretty loaded terms. Assuming the poor are all social parasites, rather than people who had some bad breaks (especially of birth), and that those who have a lot got there by doing good works. But, reality is a lot more complicated than that. How many of our top one percenters got there because of good works (inventing something useful, building a productive business), versus how many are financial or real estate grifters? In any case long term social stability requires that the people near the bottom feel they have a stake in things, and are not just oppressed victims of a system designed to keep them down. Don't buy the meme about the poor deserving their lot, most are honest people who just never got a needed break.
In the meantime, there is no need for modest inflation to loot retiree's wealth. Interest rates include expected (by the market) inflation, so they can protect whatever savings they have. But, those who can't get a job because the economy won't provide it are simply screwed, their lives are in effect being looted by those who are willing to punish the les fortunate among us.
It's funny how people think when they are on the winning side of the game
And how quickly they flip when the tide turns against them too
___________________________
Do the letters T.A.R.P. ring a parasitic bell of recollection?
No? Didn't think so.
"but the military is mostly competent"
You must be one of those youngsters that didn't get drafted. The military in which I spent three un-lovely years in would make a destruction derby look like a well oiled transportation system. You couldn't convince me that it has changed much. They have an unlimited budget, a below-average-IQ staff and no sense of direction.
"the military is mostly competent"
Wasn't it General George Custard who said that?
OT - A few days ago someone asked for the link to the statement from the CEO of Chesapeake where he makes what appears to be 180 degree turn not just from shale gas but all NG plays.
http://www.rigzone.com/news/article.asp?a_id=100024&hmpn=1
That was me - Thanks a lot!
Rgds
WeekendPeak
Re. Jeff Rubin on Quantitative Easing above...
"If you think the economy needs help now, just wait until you see what it needs when yesterday’s bailouts become tomorrow’s spending cutbacks... "
Some are not waiting until tomorrow - they are getting ready to profit from another round of Fed Fail.
I wonder if we will have a functional financial system left to bankroll the 2012 Election Circus?
----------
Hedgies are betting on a kaboom in the big banks
Saxo Bank says, "Bring It On Ben"
Stop all the spending, all of it and you still won't save the dollar.
In fact it would probably lead to a panic.
OTH, you'll have your final victory over John Maynard Keynes.
And be sure to raise those interest rates thru the roof to control hyperinflation.
Or just keep the fraud going and hope we can make the kids pay for it.
End the fraud, pay the bill for the fraud, and do not allow the fraud of ponzi finance to continue.
Solar-Panel Maker to Close a Factory and Delay Expansion
Summary of Weekly Petroleum Data for the Week Ending October 29, 2010 [PDF]
Dmitry Orlov: A Survey of Unlikely Voters
I think it was Orlov who urged those of us who were trying to increase our awareness of where we were heading to (paraphrasing) "ignore politicians and celebrities as they will become increasingly irrelevent..." as the US collapse unfolds.
I've tried to follow that advice - ditched my television several years ago and I have certainly all but given up on my gov't and a large portion of my countrymen who just can't stand the thought of "big" government all while being the largest beneficiaries of what that big government affords them (just look at what happens during natural disasters and other crises - the cries are never for Big Business to come in and bail them out, it's always for the gov't to come make things "right").
Orlov is always such a dose of sunshine. ;-)
I keep reading about the three problems of peak oil, financial breakdown and climate change. Unemployment is obviously part of financial breakdown but the "problem" no one seems to mention is the phantom unemployment due to population increase. About 125,000 people will enter the work force each month and since they do not have jobs, they are not counted as unemployed until they have a job and get laid off and then only if they have had a job long enough to qualify for unemployment compensation. These unemployed are often a financial burden to their parents.
Add to the entering 125,000 the multi-thousand each month that have terminated compensation at the end of 99 weeks. Another hidden statistic is the number of small business owners that have gone out of business and do not qualify for unemployment (I personally know three).
It is hard for us setting here on the Internet, preaching to the choir, to contemplate the total devastation that is happening to the USA. Graphs do not cry.
Shadowstats gets mentioned from time to time
http://www.shadowstats.com/alternate_data/unemployment-charts
How much unemployment dole money does a single man get in the US per week/month? Is it dependent on State or paid from Federal funds? Here in the UK a single man's 'Job Seekers Allowance' is £62 per week. Then there is the possibility of getting housing paid for too but the recent government spending review has just slashed that.
I would be interested to know how British unemployment support compares to the US.
It's very complicated here. The rules vary from state to state.
Unemployment therefore varies depending on where you live. It also depends on how much money you were making, since the payment is usually a percent of your former salary.
People who were fired for cause, quit, were part-time, temporary, or self-employed do not get unemployment benefits. Whether you have a family to support doesn't factor into your benefit.
There are other programs that offer benefits to the poor, employed or not.
In Canada you are (for statistical purposes) counted as employed if you worked 1 (ONE) hour last month. If you stopped looking for work for whatever reason you are not counted as unemployed anymore and do not drag statistics. Also, job creation/loss statistics do not differentiate between full and part time.
Yes, here in the US you have to keep looking for work to get the benefits. (There are forms you fill out, saying which jobs you applied for, etc.)
Taking a temporary job can nuke your benefits (since once it's over, you're unemployed again, this time with no unemployment insurance). So people who do get unemployment are often reluctant to take a temporary or part-time job until they've exhausted their benefits.
I got about the equivalent of GBP 300/week. Keep in mind that to keep my health insurance I was required to pay GBP 65/week. Taxes withheld at 15%.
Here in Canada I was unemployed for 10 month last year. The weekly amount that I got was based on the weekly income of my last job up to a maximum. I was paid C$400/week after deductions, which was the maximum -- yes you pay tax on unemployment earnings. The number of weeks that you can collect depends on how long you've been working, but it maxes out at about 50 weeks depending on the unemployment rate in your area.
You are mistaken in regard to how the U.S. government counts the unemployed. Job seekers who have never had a job but are actively seeking one are counted as unemployed. Also, people whose unemployment benefits have expired are still counted as unemployed if they are seeking work.
To be counted as unemployed you must
1. not have worked even an hour during the past month
2. be actively seeking work.
Whether or not you receive unemployment benefits has nothing to do with whether you are counted as unemployed.
The unemployment numbers come from a sample survey of households selected by stratified random sampling.
Don and others...
What is your take on the unemployment benefits that are set to run out soon? I've got a buddy who hasn't worked in years, that still draws an UE check. The guy is worried they won't extend his benefits so he can continue to spend the days interneting. I wish i could get in on that gravy train!
Politics is not my field, and this is really more a political than an economic questions. The Democrats, who still control the Senate, will probably want to extend unemployment benefits. The Republicans, who now control the House of Representatives, will probably not want to extend benefits. If the Democrats and Republicans can reach a compromise (by no means certain), then there could be some limited extension of benefits, perhaps in return for the Democrats agreeing to boost military spending.
As an economist who has no use for either Republicans or Democrats, I favor the extension of unemployment benefits, not only on humanitarian grounds but also on the grounds of keeping up disposable income in hard times to keep the economy from gettiong worse.
But doesn't unemployment insurance have the perverse effect of encouraging it?
What we need is a jobs program and massive effort to become more efficient in our use of energy, particularly oil.
Unemployment insurance is just more debt fiat money nonsense. Who is paying for it?
I'm a liberal but I cannot begin to tell you the contempt I have for the whole unemployment insurance/SS disability/Medicaid/motorized scooter crowd.
We are nation of idiot slobs addicted to debt fiat money. The banks, the ghetto/barrio/trailer park dwellers - screw them all.
There has been a heckuva lot of good research done on whether or not unemployment compensation is a disincentive to work. It turns out that in the U.S. the disincentive effect is relatively weak. In Sweden it hardly exists at all. In the UK the dole to the unemployed does seem to be a fairly strong disincentive to seeking and getting a job. Thus I think your conclusion about lumping in those who are getting unemployment benefits with the lazy who just don't want to work is largely wrong.
Only if it is sufficiently cushy that it encourages people to stay (or go on) it. In the sense that it keeps spending up it supports demand. The sort of downturn we are in is caused by less demand for stuff than capability to produce stuff. So you need some party to create demand, either directly -by say building infrastructure (debt be dammed), or by giving money to people that will spend it. But the "morality-play" view of economics gives stimulus a bad name, since it is funded by an increase of public debt (or printing money). But, we don't seem to have an aconomy that can stay out of trouble without some artificial stimulation of demand.
One has to be part sociopath in order to believe that the poor, sick and unemployed "want" to be in the desperate positions that they occupy.
"But for the grace of God" is not something to be mumbled only when inside an air conditioned church.
- screw them all.
Translation: Die Motherf***ers, die!
Definitely a liberal attitude.
Damn Superman, you're one MEAN DRUNK!
.. Maybe all the Bankers and Ghetto Dwellers (to pick one of the 'miserable lot' that you, in your froth are despising today..) just need an opportunity to get an decent job.
The people who are sweating it out in the economic doldrums and live in hovels didn't create this mess.
MOST PEOPLE want a good job, and they want to do good work. They want a chance. Any other bad habits they've picked up along the way are symptoms of a broken system.. but that doesn't show These People as useless. Even your angry and adolescent rant doesn't condemn you as 'damaged goods' .. you're just pissed at a bad situation, and have every right to be. Just don't blame the wrong things for the problem. Be strategic with your contempt.
Great Bumper Sticker in my area..
"It's not impressive to be well adjusted in a sick system"
"Were all in airplanes, and it's a long way down"
Your situation could change in an instant.
There are people of avarice and evil everywhere.
Or, perhaps, just a mistake.
Your heart could go.
You could forget... everything, slowly... playing crosswords becomes making marks on the puzzle becomes just... staring
On SS Disability, living in a trailer park, unassisted, and having utilities could become -just a dream- .
That's why there's Soylent Green.
The flip-side to your statement is "Eat the rich".
The disparity between rich and poor is caused by the concentration of wealth. It is displayed at it's best in Mexico and Nigeria.
You don't want anyone taking from you without immediate benefit in return.
But by gathering everything to yourself, you take from everyone else.
It is like slaughtering the buffalo for their tongues. You get a little value each time. Everyone else starves. Screw them all.
It is like misrepresenting mortgage instruments to sucker investors. You get your bonus. The economy is ruined. Screw them all.
And then another financial wizard, like Madoff, takes you down.
And you have a stroke in apoplexy...
You're a mean one, Mr. Oilman. And I thought it was mostly the Neocons that lived in a black and white world. I guess I'd better apologize for being on Social Security Disability Insurance at the tender age of 55 after having worked 30 years for the "privilege". Since you obviously know so much about us "parasites on society" and the "system", I guess I wouldn't have to explain that S.S.D.I. is funded by your own involuntary payroll deductions (F.I.C.A.), which pays the Premium. It doesn't depend on anything out of YOUR pocket.
Let me further entertain you with the details of just what it takes to actually GET approved (although I'm sure that your vast research into the subject has already informed you...).
Step 1: Initial application is a dozen or so pages plus Doctors records, which you attempt to record on "lines" suitable for Microfilm responses but unsuitable for anything else.
Step 2: Wait 4-5 months, then get the answer 70-80% get: "DENIED"
Step 3: After first Denial, hire Attorney. Attorney files Appeal then you wait another 4-5 months (in which the S.S. Staff sends your file down to his buddy in another Cubicle, then laughs and marks DENIED again (90% second Denial rate).
Step 4: The Attorney then files a request to have your case decided by a Judge (ALJ) whenever the case backlog permits (for me about 31 months...). A few months into this process you might as well use what remains of your life savings to have a beer and rent a copy of Tom Hanks' "Castaway" because its just you alone on the beach (and hope you don't get an infected tooth along the way!).
Step 5: If you haven't died in the meantime, you finally get your Hearing, in which for the first time somebody actually SEES you. Depending on the Judge's mood and how good your Attorney is, the odds are perhaps 50-60% that the Judge will approve the case. The case is then reviewed about every three years to see if you still meet the "disabled" criteria.
So, after an average of 3 1/2 years we finally may get that famous address on "Easy Street" and even be lucky enough to afford luxuries like gas and food...
I am very aware of the suffering of those disabled, and the TERRIBLE wait, uncertainty and bureaucratic torture they go through.
IMHO, those without strong family support will just die. "Problem solved" for the bureaucracy.
I know one man (with a VERY good wife). Auto mechanic. The pressure regulating valve in his brain (cerebral-spinal fluid) clogged up and caused crushing headaches and brain damage. Thirteen brain operations, as one artificial valve after another clogged. Severe impairment of short term memory. Still otherwise quite cognizant.
On appeal, his former employer wrote fifteen pages of his deteriorating ability to work (good guy) but they finally had to let him go because he simply could not do the work. Four years later, he got SSDI. And later, Medicare.
Without a good woman to support him through all this, on the street and dead shortly after that. Short term memory is needed to survive on the street. And to fight the bureaucracy.
Best Hopes for Greater Humanity,
Alan
PS: Could this have happened to any of us ? To anyone you know, love or respect ?
What would you want to happen if you "won the lottery" ?
The answer for me, is much more and better than what we do today.
Alas, all too true.
If you have no family to advocate for you, some young "hospitalist" will off you just as swiftly as he/she might give you a second thought. The bureaucracy does not take kindly to those who are not healthy and just paying in their insurance premiums. If you get sick and dare to try and actually collect, you are dead meat. You are "discretionary spending" that needs to be cut short.
If they are still paying debts they will default. Obviously without the UE check they either need to get a job or welfare. Most likely if they can a cash job and welfare. Very likely that they will burn more oil then they have.
Next of course when they pay cash to the small business for goods instead of credit you can bet the owner who is also hurting will cheat on his takes. Indeed everyone who can and some that can't will start cheating.
I mention that because the rising underground economy will probably hit tax revenues the hardest i.e thats the biggest effect.
Spending patterns change. He will spend cash on food/gasoline and as I mentioned probably cable internet and of course car payement if he has one.
Shopping will move to second hand thrift stores yard sales etc. And he will probably use payday loans and other types of high interest loan shark loans.
He will probably keep his mobile phone, flat screen tv and internet and cable. These are his remaining connections to the good life and of course the late model car if he has one.
The quality of goods in second hand stores is high so although perhaps not fashionable he will remain fairly well dressed. Shoes for the kids may become and issue. Toys again plenty second hand. Only teenagers will really notice whats happening.
The biggest change will probably be in housing obviously being able to consistently make a mortgage payment or pay expensive rent is and issue.
So move to a cheap apartment/trailer and continuously have problems paying rent. Move in with relatives or friends etc. Perhaps living in his car from time to time. Of course he would also be aggressively going after section 8 housing after a point.
Indeed at least in the US outside of having to watch your spending and being wiped out repeatedly by emergencies the decline in your standard of housing is the number one problem being poor. Certainly you move to cheaper foods normally but the difference is not as great as you might think. Buying things like a game console for the kids is doable and used games instead of new etc. You don't buy houses you don't buy refrigerators you don't buy a tv unless your breaks hamburgers and hotdogs instead of steak etc. Cheaper beer but still beer.
If you eventually have to replace the car its used car lots.
Eventually because you don't have any insurance and your often writing hot checks you start building up a rap sheet of sorts primarily driving offenses in any case pretty much no matter what you start to have legal troubles as you can't pay the various fines you will eventually incur.
Then you get a warrant for your arrest next traffic stop sends you to jail then you have to scrap together bail. Next if and employer runs your record this lights up plus you often lose your license knocking you out of a lot of jobs.
At this point you resort to petty thefts generally from companies. Copper is popular now. If you don't electrocute yourself then you eventually get caught. Go down longer and spend more time with real criminals. Often at some point along the way you become depressed and resort to illegal drug use and just as often get busted for that.
Now your finally officially poor in America your a felon with and addiction and no hope for a decent job ever.
As often as not you lose it mentally and start committing aggravated assault and or kill someone robbing some place then your in for life.
Sorry for the long response but I think this is where most people will end up on the long slide to the bottom. A few will manage to arrest their fall at some point along this path at least for a time. Many won't. But thats the gravy train your buddy has in store for him. Not sure why you want on it. Yes on the surface his life does not look all that different but its whats happening under the surface that matters.
Yup...its an ugly path downward.
This guy is under the age of 30 and physically could handle a lot of jobs, its that he won't work for under a certain wage (he is a union worker use to $30+ an hour). I doubt minimum wage would even be as much as his UE.
Don-
I hope they renew it... Its only going to make things even worse if they don't.
Don et al: Thank you for your considered response(s). My point of reference was not the government numbers to count one as unemployed but will the person get unemployment compensation. The destitute person is the one that will have the most serious problems coping with life in general and possible to follow the scenario down thread. We wonder when TSWHTF but for many that time has past.
There is a filling station on a corner near where I live. Most everything I really need to know about peak oil is on the price sign out front.... if the price is too high then I have to cut back. We are already pretty low on the CO2 list of offenders. In that regard, our leaders are at the top of the list and this is a representative government. What I need to know about finance is posted at the bank. Our CDs are getting about 1 1/2%. Housing is the same. Our house is paid for but there are three forclosures within a half mile. Heartache all around here in a valley north of Reno, NV.
Disclosure: I am already a doomer and prepper and quite familiar with most of the “bad news” arguments however let’s consider a real black swan like coronal mass ejection, EMP as in 1859 or high altitude nuclear air burst. It has been said we are nine meals from chaos.
If I were you I'd get my money out of CDs and into Treasury Inflation Protected securities--e.g. the Vanguard TIPs fund. Sooner or later we are going to have inflation, possibly a high rate of inflation. TIPs will be safe so long as the U.S. government persists as an entity, and my guess is that will be at least forty more years.
Just to start a new thread I've seen numerous posts on the drumbeat where people assume that as we enter a recession again that we will see a drop in oil consumption basically equal to the drop in GDP.
GDP component dependency on Oil is complex depending on the nature of the decline the resulting oil consumption change is difficult to determine.
Its not something I'd put a lot of faith in.
As WT often points out during the Great Depression oil consumption rose every year but the first year of the depression.
The demand side of the peak oil equation is something thats been neglected on theoildrum. In the end its how demand changes with changing oil supply not the change in oil supply itself that determines the effect of peak oil. Its a bit sad that this topic has not been explored extensively.
I think demand for petroleum products in the U.S. will roughly parallel changes in real GDP. The Great Depression case is nothing like the situation we are in now, because during the Great Depression oil was very cheap and the relatively new technology of automobiles was spreading rapidly.
Today oil is expensive, though if we have a deflationary depression the price of oil could go down to $20 a barrel, as suggested by Stoneleigh in the quote that leads this Drumbeat.
During the 1930s there was no move to smaller cars to economize on gasoline use; today and in the future we can see the high probability that cars will become more efficient and smaller.
I think that you are taking too much of a US centric view.
Regarding consumption versus oil prices, US consumption in 2009 was down to below its 1998 level, while China's oil consumption in 2009 was about twice its 1998 level.
I frequently quote the Thirties number about US cars, i.e., that there were reportedly three million more cars on the road in 1937 than in 1929 in the US. Today, China is to our current situation as the US was to the Thirties, except that there are now hundreds of millions of people in developing countries worldwide who would like to buy a car, and many of them can buy a car.
http://www.caradvice.com.au/90031/china-sales-on-track-to-top-us-sales-r...
China sales on track to top US sales record of 17.4 million
I think the probability of a global deflationary depression within two years is about 50%. If we do get a global depression, that would reduce demand for oil even in China and India. Also, I do not think China will sustain its rapid growth much longer: They have a housing bubble comparable to and perhaps worse than the U.S. did in 2006.
But let us look on the bright side: The Texas Rangers lost the World Series, so there is no sign of the Apocolypse.
But that gets us back to the Thirties analogue, when it appears that demand only fell in one year, in 1930, with oil prices rising at 11%/year, from the summer of '31 to the summer of '37. IMO, we have already seen the low for this down cycle, when the average price fell to $62 in 2009. If the pattern of year over year price declines that we have seen from 1997 to 2009 holds (with each successive annual price decline falling to a level about twice the level of the previous decline), the next year over year annual price decline will bring us down to the $120 range.
Well, I guess some good came out of the Rangers' loss.
I think a ten percent decline in global demand for oil would send the price down to about twenty dollars a barrel. Of course it would not stay at twenty dollars indefinitely; in the long run the price of oil tends to follow the cost of producing the marginal barrel.
I have no idea what the price of oil will be next year. It could collapse to the twenty dollar level (temporarily) or it could go up to $150 or more a barrel--which would send the world into a depression, though not necessarily a deflationary one.
True but perhaps not important. A better question to ask is how much can oil demand change before you start seeing infrastructure failure ?
Maybe it can go down by 10% but thats even questionable. Next to sort of jump your posts equating India and China's construction boom with the US as far as oil demand goes is probably not correct. SFH and suburbia plays a big role in the US in China and India its high rise condo's and commercial construction methods and a rail system. Even in the US oil usage for commercial construction is very different from SFH homes.
At the very least changes in oil demand in China/India as their housing bubble collapses won't follow the same pattern is the US.
Its a apples to oranges comparison. And of course using my debt arguments the nature of the debt is also radically different if anything close to japan. And last but not least China has a lot more leeway to manage its economy. India perhaps not as much but it will be forced down what ever path China takes. Indeed the Chinese economy is now large enough they you may well find that the US economy starts to follow China if China is forced to take drastic measures. Instead of decoupling we may well find ourselves in a reverse coupling situation.
One possible outcome is that China in order to save its economy actually changes policy and allows the Yaun to rapidly increase in value.
Sacrificing exports in exchange for bolstering its internal economy. However it might not be as big a sacrifice as it seems at first since a appreciating Yuan would lower raw material import costs significantly allowing exporters some relief.
Just to repeat myself one more time I don't see any indication that we are faced with trivial GPD/Oil demand/Price problem. Its a lot more complex than that. Heck the current price of oil today might simply be entirely a result of the QE2 announcements by the Feds.
Or not ...
Depends on why you think we chose the QE2 path to begin with any why now ?
As usual I have a entirely different interpretation and the crazy bastards have decided to leverage a real lack of oil to incite cost-push inflation since other approaches failed. Right or wrong who knows but if the US has decided to go QE2 on top of a real supply problem with oil then hopefully you see that the results could get interesting fast.
http://en.wikipedia.org/wiki/Cost-push_inflation
Problem is it ain't 1980 anymore.
And one more time right or wrong at the very least consider that we are entering a time where the economic model is starting to get very very interesting esp as regards to oil. My number one conclusion is be very careful about the assumptions you make you could well find yourself wrong esp fairly simplistic assumptions. And underlying that of course the real reason why things are getting interesting is because the fan is starting to get some spatters.
You are correct that many factors (including speculation) affect the price of oil. But over time we get back to good old supply and demand. I think we are agreed that production capacity of oil is going to go down drastically over the next ten years, and probably net oil exports will go down even more drastically.
In light of these drastic decreases in production capacity, it is really, really hard to predict with any accuracy the future demand for oil products. If decreasing oil production causes a worsening global depression, then demand for oil will go down a lot. After a deflationary depression I would not be surprised to see a global hyperinflation to get rid of debt and to transfer wealth from creditors to debtors. Thus we might see oil at a trillion dollars a barrel five years from now or at fifty dollars a barrel, if the deflationary depression persists.
We live in interesting times. (The ancient Chinese curse actually goes: "May your children live in interesting times.")
Yes as usual we are in basic agreement and I'll not quote the rest but deflation followed by hyperinflation and currency collapse is almost certainly correct.
I'm responding to hopefully clarify my position. The current global economy is based on cooperation between the various central banks and a de facto world currency often denominated in dollars but with the FOREX system the currency used is not so important. Sure exchange rates matter but behind the exchange rates lies a unified economic policy that gave us globalization in the first place. Certainly there are public announcements of various positions the Chinese dollar peg for example ( others peg the dollar what about them ) closed door positions by definition are harder to know. Regardless at least till recently despite the warts the overall system worked.
My point is I simply don't see our current global economic system with close coordination between the central banks even if they have disagreements continuing to exist.
Yes the individual currencies will probably go through deflation/hyperinflation but in my opinion it will now be against a backdrop of central banks that are increasingly openly antagonistic and manipulating their currencies for their own benefit damned everyone else.
This will of course introduce extreme volatility into the forex exchange and destroy the virtual effective global currency.
The Euro for example could self destruct or it could well become the strongest currency as collective inaction inadvertently saves the currency.
As I mentioned Chinese policy could change on a dime. These games will be played out against a backdrop of constrained oil supplies and food and commodities in general. Trying to distinguish whats a result of a economic game and whats the result of the underlying fundamentals with commodities esp oil will be difficult. For example from my view QE2 was probably fashioned to occur right on top of and underlying fundamental supply/demand spike in oil prices. Right or wrong who knows. However access to oil and other commodities plays a big role behind the scenes of such financial games.
When the dust finally settles lack of oil and deflation and hyperinflation and thence collapse of a individual currency will take place against a very different global economic landscape. More likely than not many currencies will no longer be freely convertible. Fixed government exchange rates will diverge dramatically from black market rates. International trade as we know it at least will cease to exist.
Who knows ? I'm of course guessing but my point is for now at least I think the important factor is if the basic thesis is right and economic warfare is the new black. And if so whats the outcome ? Indeed by the time we get around to the eventual collapse of the individual fiat currencies it seems to me at least almost irrelevant the damage will already be done.
Put it this way by the time currency collapse becomes a problem we will have far larger issues on our plate.
Similar to discussing inflation of US confederacy scripts after the tide of battle had already turned and they where obviously losing the war.
Its and after effect of the what ever happens to globalization over the next couple of years not a cause.
Certainly we are in agreement on the end game but my point is to realize that it is the end game. The decisive moves are happening right now the back drop under which the end game occurs is being decided even as we discuss it :)
And to be clear I don't know whats going to happen best case is everyone stands down and allows the currencies to die a natural death I don't however see that happening.
Along those lines, the Fed is hoping for sustained, high oil prices, an oil "bubble which doesn't pop" so to say, which in their thinking should have the twin effects of further bailing out Wall Street through the commodities exchanges, and encouraging efficiency in the U.S. so we can somehow return to organic growth, which should solve unemployment. Keep the oligarchs and peasants happy, if you will.
If this is true, the equities market may have to be sacrificed, wiping out pensioners and alot of upper middle class Boomers.
All I know is, I wouldn't want to be Bernanke right now.
Let alone Greenspan
Old news but still significant.
Greenspan Admits 'Flaw' to Congress, Predicts More Economic Problems
And don't forget.
Greenspan admits Iraq was about oil, as deaths put at 1.2m
And how could I forget this one
Peak Oil and the Financial Markets: A Forecast for 2008
Hmm, how much earlier I wonder...
When did he freak out and slam interest rates lower ?
This would have been the response to peak oil.
Assuming my graph is basically right on my blog peak oil itself or more correctly the bumpy peak plataue
would have been obvious by 1995-1998 esp if you have info on projects coming on line.
With good data you could have projected production reasonably well for the next few years.
Even as early as 2001 you would have realized you where at the peak.
You don't have to be a peak oiler to figure out peak oil if you have the data it does not sneak up on you.
Its a multi year event with the pre-peak peak and then initial post peak decline lasting almost a decade.
I'd argue its a safe bet to assume that the US has pretty good field level production data for most of the worlds oil fields.
And other data like seaborn exports pipeline refined product flows etc to cross correlate a excellent picture of the worlds oil.
On top of that the would also know all project coming on stream.
A lot of this data is not secret simply hidden from the public. Lack of transparency does not mean the data does not exist and it would readily be collectible by even a fairly incompetent government agency. Esp the US give how contracting works.
What really really interesting to me at least is if you buy into the dropping of interest rates as the freakout peak oil response then some of the earlier financial moves can be seen as peak maybe moves. Why would the US later make and expert on the depression chairman of the fed even as the economy was booming ?
http://www.npr.org/templates/story/story.php?storyId=4973231
He was chosen in Oct 2005.
Obviously the search would have started sooner.
Well well what do you know ....
Look what I dug up.
http://ideas.repec.org/p/cvs/starer/97-25.html
Nice little gem ...
Lets see we have the first shooter the guy on the grassy knoll the smoking gun dead body and its all hidden in plain sight.
Indeed we have a good date when the US might have come very concerned about the arrival of peak oil in the near future 1997.
I don't think Greenspan was really leading the Fed back then if you read his speeches and how he talks its clear that the the decisions
where the result of a group effort not his alone. Ben was probably effectively leading Fed policy at and earlier date.
Later they simply moved the man behind the curtain to the front role.
One of my dreams is that when all this is said and done the real truth about peak oil will be made public. I'm pretty sure I nailed it now I want to see my report card.
[i.mage.+]
You think ?
Its instructive to look at per capita oil usage in the US vs median income on a state basis. The results are surprising despite wide variation in per capita income oil consumption is very similar. The decline of the rust belt region had no effect on per capita consumption for example.
One very fundamental factor is at play during times of economic/political stress and thats migration. Its a basic response that transcends history. For the US you have the Okies for example. The migratory response has been muted so far in the US I suspect because of the large number of homeowners underwater coupled with extension of unemployment benefits. These factors are becoming less important the extended benefits have ended and my home owners have fallen into foreclosure. Another factor has been the rise of two wage earner families requiring two jobs to be found in a move. Again this a factor thats becoming less important.
Bottom line is people are probably going to finally start moving around in search of greener pastures. This requires oil.
Next the past/current recession was predominately a housing bust and focused even more on new home construction. That industry is oil intensive thus the coupling of GDP to oil consumption that seems to hold now is probably and artifact of the collapse of the construction industry.
Its contribution to GDP is now low enough that a further decline in housing construction will have a limited impact.
Indeed I predicted that we would see oil consumption in the US trend sideways to upwards a while back it has done so.
I expect this trend to continue indeed demographics will probably force it steadily higher.
Last but not least we have a real infrastructure limit to oil usage to do anything requires a certain amount of oil. The easiest way to see this perhaps is at the pipeline level a very fundamental limit exists to how much oil the US needs to operate its pipelines. Fall below that even if its demand driven and the infrastructure breaks down. Thats one of the basic ones more exist.
My point is the simple assumption that oil usage will track GDP may not be true on close inspection. And the actual change is probably complex and dependent on a number of factors. As a bottom line even if the US economy fell to be equal to Detroit in Mississippi I don't see any indication that it would impact oil consumption. Detroit America if you will uses almost the same amount of oil as we do today.
If real GDP declines then both median real incomes will decline, and also unemployment will increase. Both of these factors will reduce the demand for gasoline and jet fuel and to some extent diesel.
I do not claim a perfect correlation between movements in real GDP and demand for petroleum products; maybe the correlation is about .80
If oil prices increase (i.e. no deflationary depression), then I would expect to see more conservation of oil. In other words, real GDP could stay the same but the consumption of oil would fall.
I have no idea what oil prices will be a year from now.
We shall see my opinion is that for recent history the impact of the housing bubble and collapse esp in construction distorts the situation to the point that any longer term assumptions based on recent events are probably erronous.
My attempt at looking at correlation between regional economies and oil usage show no correlation at all. I'd have to dig to find all the papers and work but I'm simply suggesting strongly that people should attempt to do what I did. Look at oil consumption based on regional economic downturns and extrapolate to get a reasonable result.
As far as high oil prices go well a high price scenario obviously becomes a supply demand issue supply needs to be considered.
As far as I can tell the consensus on the oil drum is that OPEC now has spare supply and that it will be 2012 or so before supply as and issue.
On the demand side level consumption to small moves up or down seems to be the best result assuming we have surplus capacity now even a small change downwards in demand should keep prices in check. So high oil prices should not be and issue unless supply is itself and issue.
At best perhaps some fairly short term price increases that would dissipate as oil prices themselves worked to force demand down directly.
Yes at some point it does come back to supply.
My own conclusion is that supply is probably not adequate even for our current economic level and demand is now fairly inelastic over large changes in GDP. Thus my result is what I think we will see is falling GDP and rising oil prices as our economy transitions to a survival one with food and oil expenditures playing a ever larger role. Basically net income minus food and energy expenditures will fall while overall consumption of both will remain fairly constant.
This is possible over the short term because of the substantial amount of debt primarily in the form of mortgages which can be defaulted on.
Thanks to the Fed further debt defaults will have little impact on the economy. For renters they will seek cheaper rents.
If one looks at debt first which you should the primary economic force is defaulting on debt to free cash flow to cover rising food/energy prices. Pulling back on spending for other stuff is secondary. Indeed you get paradoxes like a surge in Auto purchases which look good at first however under the covers what may well be happening is people are purchasing a new car while their credit is still good since they plan to default in the near future.
Given the significant amount of income absorbed by debt for most people once they default their cash flow not only easily covers rising oil/food costs but also allows them to purchase goods and services that can be paid for with cash.
Simply looking at GDP and assuming its the holy grail completely misses this dash to cash. Indeed exactly how GDP moves under this scenario is not clear since debt and debt defaults are not well represented. Where it should have shown up the government has backstopped.
If I'm correct then its actually fairly easy to track simply measure the correlation between foreclosure rates and bankruptcies and oil prices they will become increasingly correlated with foreclosure rates and bankruptcies rising steadily with oil price.
To prove or disprove my assertions thats the metric you should watch. The underlying fundamental change in our economy from one effectively based on housing and housing equity and mild inflation to one based on simply staying alive makes GDP itself and uncertain measure.
My best guess is it will remain fairly flat to falling slightly after all the factors are accounted for but its simply not capturing the real change. The reason is fairly simply the underlying debt defaults push GDP in so many different directions as actual cash flow changes that it probably does not move a lot in any direction. The general trend is simply away from any purchases that require debt however you have plenty of exceptions i.e new car before you default. Buy a cheaper house with a mtg then ruthless default. Run up the credit cards in one last fling etc etc. So you can certainly get some spikes in credit usage before the eventual default. If enough people decide on certain courses of action over a short period of time the simple time correlation will result in strange GDP readings generally overoptimistic.
At some point defaulting on debt will run its course and not bolster the cash economy but thats a problem for the future not today.
I suspect other economic factors based on the huge amount of default debt itself will cause problems well before we reach the point that defaults and economic transition reach a wall.
In any case thats my result. And again my primary point is that its a travesty that theoildrum has not spent more time looking at demand going forward. Perhaps I'm wrong and simplistic GDP/Oil correlation is correct but at the very least simply considering the interplay of debt/cash flow and oil usages suggests that it might not be that simple even if you reject my conclusions. Heck for a long time oil demand was assumed to be very inelastic the price drop seems to have caused people to abandon that notion. Perhaps this was premature ?
In any case in the end oil products are most often bought with cash or revolving credit thus at its most basic level oil demand is based on available cash flow same as food for that matter. If you have cash and need food or gasoline you buy food or gasoline before you purchase anything else or pay any other bill next is water/electric after that rent and these days cable seems to go high up the list at least for now.
My point is at the consumer level there is a real partitioning of cash flow amongst purchases as you become stressed obviously gasoline is high on the list indeed second only to food. This does not mean you don't minimize your consumption if your short on cash simply that you will always make your required gasoline purchases after or in-line with food. So again you have at least my fundamental individual expenditure model that bolsters the concept that gasoline might not move in tandem with GDP.
All I'm saying is take a deep look the answers may be different from what you think.
You are correct that the short-run demand for gasoline in the U.S. (and other places too) is highly price inelastic. That is why I said in an earlier comment that a ten percent drop in global GDP (and approximately a 10% or 8% drop in consumption of gasoline) would probably cause the price of oil to go down to the twenty dollar a barrel range--and that is assuming no change in oil production capacity.
In the longer run, the price elasticity of demand for gasolinge changes, and the longer the time period the less is the price inelasticy of demand. For example, over a twenty year period we might transition to 100% electric cars on the road. Alan Drake's rail proposals could be implemented in ten years if there were enough financial investment in them.
It is hard to say much about the demand for oil products in the future, because we really do not know the path of growth in global GDP in the future. Real global GDP increased during the past year, but I do not think the consumption of gasoline went up very much because the production of oil did not go up much. So I am not claiming a 1:1 correlation between GDP growth and demand for gasoline and other oil products.
A better number than real GDP for prediction of gasoline demand would be real median disposable income, but it takes longer to get that number, and for some countries you can't get it at all.
Regardless of what happens to demand, the consumption of oil products will decline drastically over the next ten years due to a geologically constrained decline in production capacity. Oil prices will fluctuate a lot, of that I'm certain.
We'll probably have in the U.S. both gasoline rationing and price controls within the next ten years. To enforce rationing, we'd need martial law--and by 2020 we may well have it. A populist dictator would love gasoline rationing and price controls.
I'm not in disagreement.
However I increasingly wonder what the real non-negotiable economic level is for various countries esp of course the major players China, US, Germany, Japan.
Increasingly I'm moving to he conclusion that no one will be willing to budge to let their national GDP's fall below a certain level. Not that in the end they can do anything about it. Simply I think we are much closer to and overall inelastic economic system then most people realize.
The economic and perhaps soon hot war is already past the point of no return.
If so I have my own ideas of course but also I hesitate to predict the future I think its now become entirely unpredictable. Of course underlying this I believe peak oil itself is already in the past so we are a lot further along the path so to speak.
Thus I think over the last two years we sort of crossed over to a new economic regime that far far less stable than it appears.
Globalization is already dead. Real free floating currencies are toast regardless of if your and official currency manipulator or not.
We are already in survival mode its just a matter of time before this impacts the overall economy.
Indeed in my case the start of World War III can now be safely dated back to the first Iraqi war if you wish. I leave that to future historians but I think they will be writing about the brief period in 2009-2012 where collapse of globalization and rise of isolationism quickly resulted in the long war that still impacts the world today.
As I said that puts us at the point where very radical economic moves become the norm not the exception. Technically you cannot predict the arrival of a black swan however no reason you cannot predict that we are now in the midst of the black swan migration.
That in my opinion is whats happening right now. So although I don't disagree I also don't think that we are on any sort of sane economic path anymore.
I don't think we've been on a sane economic path since about 1896. In that year there were two automobiles in the city of Cincinatti. They collided.
1846 by my count.
http://en.wikipedia.org/wiki/Independent_Treasury_System
Which btw overlapped this event in American history.
http://en.wikipedia.org/wiki/American_Civil_War
And of course the move to effectively fiat currency that won the war.
Great article.
http://eh.net/encyclopedia/article/ransom.civil.war.us
My opinion is that modern banking can readily be traced back to events of this period and in particular to how it interacts with modern full scale war.
The best line I've ever come up with is varaints of this.
America is the first country in history that figured out how to turn lead into gold.
Hot lead traveling at the speed of sound but lead.
We created the first modern banking/military/industrial complex over this period.
I know you where joking a bit but seriously the fundamental basis for modern war and economics was put into place right then.
People get wrapped up in the politics and slavery etc but beyond that it was the destruction of mercantilism and creation of immense wealth in the process.
http://en.wikipedia.org/wiki/Mercantilism
People to this day fail to understand why Britain stood aside during the conflict. Obviously the South blundered badly.
By why ?
Because of slavery ?
Bull$h%t
The bankers in England and Europe fully grokked what was going on and its significance as did the military.
I'm pissed that the Rothschilds and the American civil war is the domain of conspiracy nuts.
There is a real story that looks like it will never be told. And its not Europe leading but reacting to the genius of American bankers.
We or more correctly the New England bankers solved a 10,000 year old problem.
I did not full vet this link but.
http://thetruthseeker.co.uk/print.asp?ID=96
I'm certainly not the first person to recognize the rise of modern banking.
Given the way you write I'm willing to wager you already figured all this out.
I know exactly why you focus on how wars are financed :)
In the end sadly that all that matters.
Many historians have noted that the financing of wars can cause more damage than the battles. For example, the Hundred Years War was financed (especially in France) by the most brutal and extortionate taxes on peasants that can be imagined; the damage to the French economy lasted on for perhaps a century after the long war was over.
On the other hand, the U.S. financed World War 2 with bonds that yielded 2 3/4% and 2 7/8%--not much of a problem to service these bonds, especially when inflation wiped out more than half of the real value of the bonds in the thirty years after 1945. My father invested all he could in those 30 year bonds (more than $100,000) thinking that he was not only being patriotic but also was building up a secure fund for retirement.
That is why I am now a great believer in TIPS.
Cincinnati: 3n's 1t
"If the world comes to an end, I want to be in Cincinnati. Everything comes there ten years later."
The **** will really hit the fan after the spare capacity is used up - as you say, perhaps in two years. I'm optimistic that GDP will eventually be able to grow (after a transition period) even as world oil production declines and oil prices soar. The transition will be rough. Persistently high oil prices will create a frenzy of technological change. There are alternative sources of liquid fuels - coal to liquids, gas to liquids, oil shale, Canadian oil sands, etc. At the right price these alternatives will make economic sense. Also, transportation can transition to natural gas and/or batteries.
I really don't think we need to stock up on survival supplies. There will still be liquid fuels - at a price. No need to grow potatoes in your back yard. I believe the best course of action is to get our policy makers on board as soon as possible to start our post peak oil crash program. It will probably take a huge price spike or supply shock to wake up the politicians.
I believe the price spike will occur before the spare capacity is used up. Companies will see the writing on the wall and start purchasing oil futures contracts to ensure they have enough oil supply. We should perhaps welcome the price spike as it may finally goad the government into constructive action.
I suspect that you are too optimistic in your forecast of a successful transition away from oil. Problem one is that net exports of oil and oil products are going to decrease quite rapidly. Problem two is that getting liquid fuels from coal or natural gas or hydrogen or shale or anything except conventional or heavy oil is very expensive.
The infrastructure of the U.S. is designed to run on cheap oil. I doubt that we can have much if any real economic growth with oil above eighty dollars a barrel. Sure, we can get lots and lots of liquid fuels for three or four hundred dollars a barrel, but nobody will be able to buy it except rich people. I doubt if roads will be maintained out of decreasing tax revenue to benefit only the wealthy.
My guess is that U.S. real GDP will be down by about half by 2020 or shortly thereafter. Of course, I could be wrong. It's not likely, but the consensus on TOD could be wrong and Yergin and CERA right. Stranger things have happened.
Hirsch's analysis included all these wedges. He found that a decade of WW II-scale mobilization merely flat-lines the fall, and he didn't include the significant shovel of Export Land.
(This comment should be up a level.)
A big part of the problem with cars is the time required to change the mix of vehicles. A new car has a half life of about 8 years, which is down from 10 years a few decades ago. That is a result of cars being wrecked or junked over time, giving something like an exponential decay in the number of cars in the mix from each year's production. While newer cars with better MPG can be built, their impact on the fuel economy of the total fleet takes many years to build, as older vehicles are still driven. In a recession, the older cars might be on the road longer, as people might tend to drive less per year.
Many people (most?) buy used cars, not new ones, as older cars are passed down to the junk yard. People with no job but some skill with a wrench can keep an old car running far longer than your average city or suburban dweller, who needs a newer, more reliable vehicle for the daily commute. Keeping an older car running can be expensive, as the automobile companies make their profit from selling parts. That characteristic is part of the plan, since they create a monopoly of a sort with the special parts required for each years different designs. By keeping the cost of repair parts high, the auto companies make it more expensive to repair even minor collision damage and thus repairable cars are junked by the insurance companies.
After Peak Oil, as the price of oil can be expected to increase, it may be that people won't be able to buy as many cars a year as before. The value of used gas guzzling vehicles would be expected to decline, even though they were still functional, thus reducing trade in value, which would increase the cost of buying a new car. Also, the profit from a small car is less than that of a large SUV or monster pickup, so the auto companies would suffer as a result. It might be that their business model would need to change and drastically so...
E. Swanson
Your right but also as I noted above many people caught in this situation will find a way out.
The obvious one is buy a new car while you still have credit and default even if you can't afford it with your current lifestyle.
I.e people recognizing this trap will choose the new car and pay that one debt at the expense of others.
Others of course will make different decisions. And obviously the used cars stay in the fleet as just as many choose a paid off used car
in exchange for higher fuel costs. Overall what I see time and again is that opposing trends tend to cancel resulting in little overall change.
As I mentioned only debt default often coldly calculated to maximize value seems to change at least for the time being.
Housing prices of course continue to fall and soon probably rents but other than that for now at least the US economy and oil demand seem pretty much stuck rising oil prices as I posted on my long article will simply increase the foreclosure/bankruptcy rate.
"A new car has a half life of about 8 years, which is down from 10 years a few decades ago."
False:
"The median and mean age of automobiles has steadily increased since 1969. In 2007 the overall median age for automobiles was 9.2 years, a significant increase over 1990 when the median age of vehicles in operation in the US was 6.5 years and 1969 when the mean age for automobiles was 5.1 years.[6]"
http://en.wikipedia.org/wiki/Passenger_vehicles_in_the_United_States
I am thinking that the GDP may drop more than oil consumption, because the first things to go will be services that don't depend a whole lot on oil. For example, the financial system is very much oversized. The people are high paid, but it doesn't directly use a lot of oil.
If the financial system contracts drastically that would result from financial collapse and probably a deflationary depression to follow that would affect all sectors of the economy--especially tourism and other discretionary travel.
Nevertheless, you are correct: GDP could decline faster than demand for oil products. But if real GDP goes down 50% (which I expect by 2020 or shortly thereafter) I think consumption of oil products will decline at least thirty-five to forty percent. But the real constraint on consumption of oil products over any extended period of time is geological limits to oil production capacity. Thus, over time, I expect consumption to follow production down, despite year to year fluctuations in demand.
I agree with you and Memmel, but I'm beginning to realize how US centric our thinking has been.
Locally in Thailand, I expected to see a drop in tourism. Dead wrong. Bookings and plane arrivals are way up. Just that the language spoken is Russian.
Down the road in Malasia, they told the IMF to get lost ten years ago. They kept their currency where they wanted it. Now they are refusing to allow it to appreciate "to ensure the competitiveness of Malaysian exports "
So indeed , events are playing out fairly predictably in the US,but I may have gotten into a little wishful thinking over here. Now the local situation may be dismissed as irrelevant but it must be noted that the rest of the world does not march to a US drummer.
These are the good old days
Link up top: Petrobras questions BG reserves boost
Could Petrobras' reluctance to want sub-salt reserves counted be a sign that they know something that we don't know? Anyway...
A few days ago I asked a question why Brazil's proven reserves were so low if they had found such a vast amount of sub-salt oil. The person I asked, whom I shall not name, replied with a biting insult, that he did not know what to think about a man who had been on this list that long and not realize that reserves were not counted until they went into production.
I replied that Saudi and many other nations did no such thing. They counted reserves long before they ever went into production. The reply was that "Yes but those are NOCs. Publicly traded companies are not allowed to do that." A dodge I grant you, but I let it drop there.
Well hell. Now I find out that publicly traded companies do do exactly that. BG, a British gas company, is claiming, as their reserves, Brazilian sub-salt gas that is not yet in production. Of course this is gas, not oil, but they are claiming BOE and the exact same principle applies.
The moral of this story is, get your ducks in a row before you imply someone is a fool. The tables just might be turned.
I apologize for bringing the subject up again and would have never done it had not Leanan posted the link up top showing that NOCs are not the only companies who post reserves before they are in production. That makes it a brand new subject for today.
Ron P.
PM Signh says India's hydrocarbon needs will grow by 40% while oil production will only go up by 12%
http://green.autoblog.com/2010/11/03/pm-of-india-demand-for-hydrocarbon-...
Nice to see a world leader admit to the upcoming mess.
And that 12% increase over the next 10 years may be over-optimistic but I probably don't need to say that here.
The Coming Showdown Over America's Energy Future
apologies if previously posted
From the Financial Times:
IEA fears oil spike if climate pledges fail
What a difference a change in US administration makes.
How very true!
http://www.theatlantic.com/politics/archive/2010/11/what-now-an-epic-ele...
Perhaps the GOP is mostly backed by big oil and coal, or is that just a coincidence, eh?
Voters are pretty fickle, they overwhelming defeated prop 23, which was designed to gut the greenhouse gases laws, but vote in congressional Republicans who have an attack on the science high of their list of priorities. I wonder if they will have buyer's remorse when they see the meanspirited ignorance on display?
mark my words the next two years will be filled with McCarthy style congressional hearings for each and every high profile climate scientist here in the united states searching for this 'fraud'. just like they were going after innocent people accusing them of being sleeper cell communists in the 50's.
Ya think?
We're going to need more Jon Stewarts and Colberts..
We have to simply slam any of the barbaric nonsense with unrelenting comedy.. jokes that THEIR constituents will laugh at.
"We're going to need more Jon Stewarts"
--Did Richard Dreyfus say that in the Jaws movie?
That's about the right analogy..
'Farewell and adieu, my sweet Spanish ladies..'
or was it,
'Anyway, we delivered the Bomb..'
Fiat, Toyota 'years ahead' of EU emissions targets: research
Looks like the Graudian needs some new 'experts'.
Did any of them get anything truly right? When they weren't puff-piece answers, they were laughable superficial.
Mexico Cantarell Oil Field Dead by End of 2010
From August 2009:
http://ergobalance.blogspot.com/2009/08/mexico-cantarell-oil-field-dead-...
http://www.offshore-mag.com/index/article-display/3023975912/articles/of...
The new Mexican Revolution has not disappeared, just news of it has ceased leaving the country, and much of the action is being attributed to "drug cartels".
Attacks on oil and natural gas infrastructure have continued since Calderon stole the Presidential elections in 2007.
http://www.dallasnews.com/sharedcontent/dws/news/world/mexico/stories/DN...
Oil up to $85.90, almost 86 a barrel at 3:49 AM PST.
http://www.oil-price.net/
The price is always changing, so don't be surprised if it's different when you click on the link.
There seems to be a consensus amongst economists that a double-dip was avoided, and the post recession recovery is real and moving forward. On the surface that seems correct, however I'm thinking it could quite easily go a different way. Here's how it could play out:
1. Monetizing by Bernanke will continue to erode value of dollar. 600 billion in bonds now, with more to come later because debt isn't getting any smaller.
2. People's acceptence of the apparent end of the recession leads them to use more fuel and buy more stuff, leading to higher oil and fuel prices.
3. Real estate values in the US continue to flounder, while unemployment continues at about the same level.
4. When oil hits somewhere between 110 & 125 a barrel, consumers pull in like a turtle into its shell, real estate values drop another 20%, the number of homeowners with underwater mortgages increases dramatically, accompanied by a huge 2nd wave of foreclosures and business shutterings, causing another economic 'Step Down' much like the one in 08.
The price of oil drops down, but not to 35 like it did in 08, but instead to around 65-70, then quickly moves back up to around 80 again, in spite of widespread hardship in the Double-Dip.
Once the double-dip hits, it will be apparent this time that it was not initiated by a mortgage meltdown, but rather the high cost of oil. This will represent a 2nd opportunity for MSM to acknowledge and write about the connection between high oil prices and economic instability.
Of course, falling oil prices are always due to fundamentals, while rising oil prices are always due to speculation.
I think if your scenario comes to pass, they won't blame the price of oil. They'll still blame the mortgage meltdown - and the policies created to deal with it.
Krugman and his ilk will say there was not enough stimulus to get unemployment down. Denninger and Co. will say the problem was papering over the balance sheets of zombie banks, rather than forcing them to acknowledge their insolvency. The GOP will blame taxes that are too high for the fragile economy to bear. Etc.
The Fonz had his "Jumping the Shark" moment
And Krugman (New York Times financial editorials) had his "Jumping the Chasm" moment
(... those who try to jump the chasm with insufficient "stimulus, fall short)
[i.mage.+]
So you're saying MSM will miss yet another major opportunity to connect the big dots. The way different groups react by blaming other groups, it's very possible. And as WT says, spec will get blamed for higher prices. In the words of the juvenile delinquent kid in that movie with John Ritter, which him and his wife adopt, "When will people ever learn?"
I do not think there is any consensus now among economists as to the future course of U.S. real GDP. To a large extent, QE2 can be interpreted as a "Hail Mary" long pass in the final seconds of a football game. The Fed is worried right now a lot more about the possibility of a deflationary depression than they are worried about the price of oil. My conjecture is that most economists who think about energy at all accept the views of Yergin and CERA, "the authorities."
And all this goes without factoring in the distinct possibility that an event such as someone with an Agenda and a bad attitude (helpful but not required...), decides to sink a couple of Tankers in the Straight of Hormuz at a strategic point(s). That it hasn't happened yet (or a multiplicity of other possibilities) still manages to surprise me...