Drumbeat: July 13, 2011

Mexico’s 1st half oil production down 1 percent, continuing 6-year slide

MEXICO CITY — Mexico’s state-owned oil company says crude production fell by about 1 percent in the first half of 2011, as compared to same period last year.

Petroleos Mexicanos says the steady decline in oil output that began around 2005 “has begun to be reversed.”

Fuse lit for a shale gas boom

HOUSTON-BASED ConocoPhillips has emerged as the first of the big overseas oil and gas groups to back the idea that the US shale gas boom can be brought to Australia.

The group has struck a farm-in deal with locally listed junior New Standard Energy (NSE) under which it could fund $US109.5 million ($A103.2 million) in exploration work at NSE's Goldwyer shale gas project in Western Australia's Canning Basin.

Peak Oil: Tighter Supply Ahead

For how long will the Saudis be able to bail out global production?

Chevy Volt newest New York City police car

NEW YORK (CNNMoney) -- The New York City Police Department has a new cruiser that will be silently plying the city streets very soon.

Among 70 new electrically-driven vehicles purchased by the City of New York will be 50 Chevrolet Volts that will be used for, among other things, police work.

Saudi Arabia Said to Seek Iran Crude Supply Share to India

(Bloomberg) -- Saudi Arabia is seeking to benefit from a payment dispute between Iran and India by selling additional cargoes of crude oil to refiners in the South Asian nation, two people with direct knowledge of the talks said.

Saudi Arabian Oil Co., the state producer based in Dhahran, has told refiners in India it can replace some of the Iranian crude, the people said, asking not to be identified because the talks are private. A spokesman for Saudi Aramco who asked not to be identified said the company doesn't comment on speculation.

EIA: Higher US Gas Production Expected for 2011

The U.S. Energy Information Administration raised its forecast for natural-gas production for 2011, and said inventories are expected to come close to last year's record levels this fall.

The EIA also expects demand for gas to be slightly stronger than previously expected.

Boone Pickens says still buying shale acreage

(Reuters) - Energy investor T. Boone Pickens said he has been buying up U.S. shale acreage, and he could consider signing joint ventures to develop the properties, or some property sales.

"I'm in two big shale plays and one of them is the Marcellus," Pickens said in an interview, referring to the massive natural gas field that stretches from West Virginia and Ohio across Pennsylvania and into New York.

T. Boone Pickens bullish natgas in 2015

NEW YORK (Reuters) - Billionaire energy investor T. Boone Pickens who has urged the United States to move toward vehicles fueled by natural gas instead of gasoline, said on Tuesday he was not a huge holder in gas futures.

Pickens, who has been buying up acreage in U.S. land rich with gas deposits, said he is bullish on 2015 natural gas prices, pegging them above $6 per million British thermal units, but has a "somewhat minor position" in them, holding options that convey the idea that gas will rise above $6, but not above $8.

"I'm not a big holder of natural gas," he told Reuters, referring to his position in financial futures. "I'm a big holder in clean energy."

Gov. Regulates Marcellus Drilling Activities

Gov. Earl Ray Tomblin, joined by West Virginia Department of Environmental Protection (DEP) Cabinet Secretary Randy Huffman, Legislators, and natural gas industry representatives announced the filing of an executive order that directs the DEP to promulgate additional environmental regulations governing Marcellus Shale drilling activities.

Halliburton to tap Poland shale for Chevron

NEW YORK (Reuters) - Oilfield services company Halliburton Co said it had won a contract to help oil giant Chevron Corp tap into Poland's vast shale rock formations in search of natural gas.

Halliburton is the leading player in hydraulic fracturing of shale in the United States, where the controversial technology has been used to unlock huge quantities of gas that were too difficult and expensive to tap only a decade ago.

Iran establishes international crude oil exchange on island in Persian Gulf

TEHRAN, Iran — Iran has established an international exchange for crude oil in a free trade zone on the Persian Gulf island of Kish.

During a ceremony marking the launch, Ali Salehabadi, who oversees Iran’s exchanges, said the market would supply crude in the Middle East. He invited international traders to participate.

Gadhafi running low on cash and fuel, US intelligence reports say

Stalemate in Libya is giving way to building rebel pressure against the regime of Moammar Gadhafi, according to new U.S. intelligence reports.

While the battle is far from won, the officials point to three key indicators: dwindling fuel supplies, a cash crisis and reports of low morale among regime troops, U.S. officials told The Associated Press.

Why the no no no chorus has it wrong in oil

Last Friday, we discussed what happens when one adopts a my-way-or-the-highway approach to energy development, in this case opposition to Canadian oil sands. You get what we already have, which is projections of $150-a-barrel oil and $4.50-a-gallon gasoline, the product of a belief that, starting next year or soon thereafter, oil demand will start to exceed supply. This state of affairs vexes Christophe de Margerie, the CEO of France's Total oil company, who met with a small group over breakfast this morning at the Center for Strategic and International Studies. "If you say no to shale oil, no to heavy oil, no to Iran -- no, no, no, no -- what about life?" de Margerie said. Oil companies must be responsible in how they work, but everyone else must grasp that they actually need oil, and will for many decades to come, he said.

Argentina: Gov´t rules out gas hikes, denies energy crisis

Federal government assured today that gas tariffs will remain as they are and that there is not such a thing as an “energy crisis.” Enargas regulator’s head, Antonio Pronsato, affirmed that “no price readjustment have been made on gas prices since 2009, not on the stoves, neither on transport and distribution.”

‘Energy crisis can end in 18 hours’

PAKISTAN’S energy crises can be solved in 18 hours rather than by 2018 as it is purely a matter of financial management rather than lack of generation capacity.

Over 41 per cent of the world’s power is generated through coal and Pakistan has 187 billion ton coal that can be used to serve long term future goals. The current installed and workable generation capacity is enough to serve the prevailing demand. However, for future preparedness coal and hydle generation should be cited as the primary source for cheap power.

UK watchdog lets Centrica buy more gas storage space

LONDON (Reuters) - Britain's Competition Commission allowed gas producer Centrica to increase the share of capacity it can buy at its own huge North Sea Rough storage site in the 2012-13 gas year to 25 percent from 15 percent, the body said.

In January the authority had provisionally rejected the utility's bid to relax rules, also called undertakings, dating from 2003 on operating Britain's largest gas storage site in a way that did not infringe competition laws.

Russia's Gazprom wants control of Belarus' gas pipeline network

Moscow/Minsk - Russian energy giant Gazprom is in talks with the Belarusian government to take control of the country's gas transportation network, the company announced Wednesday.

Belarusian Prime Minister Mikhail Myasnikovich and Russian Prime Minister Vladimir Putin will discuss details of the proposed deal in September, said Gazprom chairman Aleksei Miller in a statement.

Pipeline protesters hit Montana governor's office

HELENA, Mont. — More than 100 environmental activists from across the country descended Tuesday on the Montana Capitol to demand Gov. Brian Schweitzer rescind his support for the Keystone XL oil pipeline and ExxonMobil's megaload transportation project.

Doug Casey on Self Immolation – Individual and National

Peak oil is a geological concept. It basically holds that all the low-hanging fruit has been picked. Now, philosophically, it rubs me the wrong way, in that I have total confidence that human ingenuity will find scores of ways to produce new hydrocarbon fuels – and lots of totally new energy sources in addition. Furthermore, the higher oil prices go, the more will be found – and the more it will be economized. So, in a free-market world, oil is a non-problem.

But we don’t currently live in that kind of world. In the meantime – let’s say the next 10-20 years – oil is an issue, for simple geological reasons. And also because, even though consumption has been basically flat in the advanced world for decades, consumption is going to grow radically in “Chindia” and the rest of the developing world. The biggest problem though is likely political, especially because of the increased political risk in the Middle East, where most of the world’s oil reserves are. You’ve got to be bullish on oil.

Panel: Nuke plants need to prepare for disaster

(AP) WASHINGTON - Calling the Japan nuclear disaster "unacceptable," an expert task force convened by the Nuclear Regulatory Commission has concluded that nuclear power plants in the U.S. need better protections for rare, catastrophic events.

The series of recommendations, included in portions of a 90-page report obtained Tuesday by The Associated Press, will reset the level of protection at the nation's 104 nuclear reactors after the worst nuclear disaster since Chernobyl by making them better prepared for incidents that they were not initially designed to handle.

Toyota betting big on growing Prius family

Betting that it’s better late than never, Toyota is readying the roll-out of the second hybrid to carry the name Prius out onto the U.S. market. The move is expected to be followed by the introduction of an entire “family” of Prius-badged offerings.

Some skeptics warn that the strategy could wind up confusing consumers. Toyota planners contend that the well-known and widely accepted Prius name will make it easier to sell new hybrid offerings to buyers who have proved surprisingly reluctant to embrace the fuel-saving technology, even while gasoline prices have been nudging record levels.

AEP, Walmart open electric vehicle charging station

Columbus, OH - Electric vehicle owners should get a jolt from a free public charging station that opened Wednesday as the result of a partnership between American Electric Power Company Inc.

FedEx Field goes solar

The Washington Redskins has signed a deal with Princeton, N.J.-based NRG Energy to install solar power systems at FedEx Field that will generate enough power to cover all of the stadium's needs on non-game days and a portion of it on game days.

Japan to shoot lasers from the moon to solve power crisis

Simple really -- just cover our neighbor in solar panels and let the sun do the work.

Jeff Rubin: Oil markets face production shortfall in second half

The International Energy Agency may not have a solution but no one can accuse them of no longer understanding the gravity of the problem.

In their June report, the IEA warned that unless OPEC could increase production by at least 1.5 million barrels a day, world oil demand is going to surpass available supply during the second half of the year.

Oil demand set to increase in 2012, IEA says

Global oil demand will increase further next year, the International Energy Agency (IEA) has predicted.

The IEA, which represents the main oil consuming nations, said the increase in crude usage would continue to be driven by emerging economies.

Opec under more pressure as it raises oil demand estimate

Opec has raised its estimate of demand for its oil by 100,000 barrels a day (bpd), strengthening the case for lifting the group's production ceiling.

Yesterday Opec economists said demand for its crude would increase to 30 million bpd in the second half of the year and would grow to 30.3 million bpd next year in spite of high prices and a shaky economic outlook.

"An unsteady world economy is negatively affecting the oil market," Opec wrote in yesterday's report, adding that sustained high prices could hurt market growth.

Oil hovers below $98 as US crude supplies jump

SINGAPORE – Oil prices hovered below $98 a barrel Wednesday in Asia after a report showed U.S. crude supplies unexpectedly rose last week, suggesting demand is weak.

Refinery capacity additions 'back with a boom' in 2012- IEA

(Reuters) - The next year will see around 2.4 million barrels per day of crude distillation capacity added globally led by growth in China, the International Energy Agency said on Wednesday.

The largest share of investment will come from China with an addition of 600,000 barrels per day (bpd), or 25 percent of the total.

Why Gas Prices Are Going Back Up

To all motorists: be prepared for higher gasoline prices ... coming soon to a pump near you.

For six weeks, the national average for regular self-serve gasoline has fallen. It all started May 11, when prices peaked at $3.965 per gallon in the United States, according to GasBuddy.com data. Oil prices then slid, resulting in a drop in average gasoline prices--hitting a low of $3.558 per gallon on June 29. However, as the old saying goes, "All good things must come to an end", and this saying appears to hold true for gasoline prices as well.

China June oil demand growth slowest in 27 months

BEIJING (Reuters) - Chinese implied oil demand rose 1.1 percent in June from a year earlier, the slowest growth in more than two years, as oil plants underwent heavy maintenance amid poor refining margins and Beijing's tightening policy cut into oil use.

But analysts said real oil use may not be as bearish as the figures show as oil firms may have been drawing on oil inventories, which were not reported by the government, to ease the pain of negative refining margins.

Russia to put 2 mln T of fuel in reserves -minister

MOSCOW (Reuters) - Russian oil companies will put up to 2 million tonnes of oil products into reserves for future use in market interventions to fight off price rises and fuel shortages, the country's energy minister said on Wednesday.

Several Russian regions suffered a severe fuel deficit in spring largely due to rising exports triggered by domestic prices caps.

US blog: Peak oil?

For investors, we suggest that peak oil is something to keep in the back of your mind but that it plays little relevance for tactical positioning. Energy markets move with much shorter term events in mind, such as global conflicts, economic conditions, and currency movements. Finally, it is not an inevitability that we run out of oil. There will almost certainly be a response as prices rise in the form of new energy sources and reduced demand for oil. As a result of all of these factors, we encourage investors to take the predictions of a dire future for energy production with a grain of salt, and focus more on things that are more visible and concrete. With demand still likely to remain relatively robust, although growing at a more subdued rate, we don’t believe a further downgrade of the sector is warranted but are remaining at marketperform for the time being.

Still Mad About Gas Prices? Your Conspiracy Theories Are True

SHARON—Whatever you’re paying for gas these days—likely just shy of $4 a gallon—you’re right to be angry about the causes of the gouging.

Forget supply and demand; budget-busting high oil prices are the result of speculation on “paper” barrels of oil—and manipulation.

Those are the conclusions of author, political commentator and retired commodities trader Raymond Learsy, who takes on big oil again in his latest book, “Oil and Finance: The Epic Corruption.”

Majors Buy SPR Crude as Supply Continues to Slide

Late last month, the International Energy Agency announced it was releasing 60 million barrels of crude oil into world markets.

Obama graciously pledged 30 million of it from our own Strategic Petroleum Reserve (SPR).

You should find our wanton oil disbursement a bit peculiar, especially since your own government defines the SPR as the “nation's first line of defense against an interruption in petroleum supplies.” So tapping it inherently implies we're facing an interruption in petroleum supply.

Nigeria: Shell fixes pipeline, resumes oil exports after 2-week force majeure

LAGOS, Nigeria — Royal Dutch Shell PLC says it has lifted a two-week export block after stabilizing production in Nigeria’s oil-rich southern delta.

Shell spokesman Precious Okolobo said Wednesday that Shell’s Nigerian subsidiary lifted a “force majeure” on its Bonny Light crude shipment on July 1. The term is used when an oil company cannot cover the promised supply from the field.

Fire damages gas pipeline in eastern Syria

BEIRUT (AP) - Fire damaged a natural gas pipeline in eastern Syria, the Oil Ministry said Wednesday, but it was unclear if the blaze was accidental or sabotage. No casualties were reported.

Syria's state-run news agency said production continued using other pipelines. Syria produces about 350,000 barrels of oil per day as well as natural gas.

West needs to treat sanctions against Syria with caution

Oil sanctions on Syria should be ready for use. But they have to be used, not to salve the consciences of western activists, but to give the final push to a tottering tyranny.

Iraq Hopes For National Oil Co Law By End-2011 - Aide

LONDON -(Dow Jones)- The Iraqi parliament is expected by the end of this year to pass a long-sought law re-establishing the Iraqi National Oil Company, or INOC, which former leader Saddam Hussein's regime invalidated in the 1980s, a top energy advisor to Prime Minister Nouri al-Maliki said.

Thamer al-Ghadhban said that the company would be involved in supervising Iraq's producing oil and gas fields, under-development fields and exploration blocks.

Iraq Kurdish June Oil Exports 175,000 B/D - Minister

LONDON -(Dow Jones)- Iraq's crude oil exports from the northern Kurdistan region in June hit a peak of 175,000 barrels a day, up from 75,000 barrels a day in February, Ashti Hawrami, oil minister for the Kurdistan Regional Government, said Wednesday.

Revenues from oil sales from the Kurdistan region over the five months since the KRG resumed exports in February has reached $2 billion.

A foot on the front line of oil security in Iraq

(Reuters) - An AK-47 slung over his shoulder, a member of the oil police walks beside a pipeline stretched like a silver thread across the vast, burning desert of southern Iraq, stopping now and then to brush sand aside with his foot.

He is looking for bombs.

Oil partners look to future

ExxonMobil, the world's biggest oil company, is vying to stay in Abu Dhabi after the emirate's main onshore concession expires in 2014.

China says oil spills not fully controlled

SHANGHAI (AP) — China has ordered ConocoPhillips to immediately halt output at two offshore platforms in the Bohai Bay off its northeast coast, saying recent oil spills were not fully under control.

Montana questions Exxon's estimate of oil spilled

BILLINGS, Mont. (AP) — State environmental regulators have asked Exxon Mobil to justify its estimate for how much oil spilled into the Yellowstone River, citing the company's changing timeline on how long it took to stop a leaking pipeline.

Hearing set in Miss. attorney general’s lawsuit against administrator of BP oil spill fund

JACKSON, Miss. — A hearing has been scheduled in the Mississippi attorney general’s lawsuit against the administrator of BP’s $20 billion oil spill fund over access to claims filed by coastal residents.

Jim Hood said Tuesday he’s tried to negotiate with the fund’s administrator, Washington lawyer Kenneth Feinberg. He says he’s seeking to make the process more transparent so people will know if Feinberg is looking out for the best interests of oil spill victims or BP.

Fracking Water Killed Trees, Study Finds

A study that argues for more research into the safe disposal of chemical-laced wastewater resulting from natural gas drilling found that a patch of national forest in West Virginia suffered quick and serious loss of vegetation after it was sprayed with hydraulic fracturing fluids.

The study, by researchers from the United States Forest Service, was published this month in the Journal of Environmental Quality. It said that two years after liquids were legally spread on a section of the Fernow Experimental Forest, within the Monongahela National Forest, more than half of the trees in the affected area were dead.

Radioactive meat circulating on Japanese market

Tokyo (CNN) -- A Japanese health official downplayed the dangers Tuesday after cesium contaminated meat from six Fukushima cows was delivered to Japanese markets and probably ingested.

Japan PM wants less reliance on nuclear power

TOKYO (AP) — Japan's prime minister said Wednesday he wants his country to learn from its ongoing crisis and become less reliant on nuclear energy.

Prime Minister Naoto Kan told a news conference that the risks are too high and renewable energy sources such as solar, wind and biomass should eventually replace nuclear as a new pillar of Japan's energy supply, along with conservation.

Heatstroke Deaths Quadruple as Japan Shuns Air Conditioners

Deaths from heatstroke in Japan quadrupled in the early part of summer as temperatures rose and air conditioners were switched off in line with government appeals to curb electricity usage to avoid power blackouts.

Task Force Recommends Improvements for Nuclear Plants

WASHINGTON — The Fukushima Daiichi meltdowns show that it is time for “redefining the level of protection that is regarded as adequate” at American nuclear plants, a special task force of the Nuclear Regulatory Commission has concluded.

Carmageddon predicted for L.A.'s 405 closing

A road closing may seem a routine inconvenience elsewhere and hardly worth noting in cities devastated recently by floods, fires and tornadoes. But in car-dependent Los Angeles, the I-405 closing is being touted as not just the biggest traffic disruption in decades but also as an almost apocalyptic event that will be felt for miles and miles.

Call it Carmageddon.

$2.4 million message: Drive slower to spare the earth

If you want to lose weight, you record what you eat and track your calories.

If you want to reduce your greenhouse gas emissions, you record how you drive, then use it to figure out how to curb your bad habits.

At least, that's the premise behind a proposal from the Metropolitan Transportation Commission, which is considering a variation on the dieter's notebook as a way to help Bay Area drivers get a handle on their fuel consumption and other ways they contribute to greenhouse gases.

With Tiny Cans, a New Trash Equation

Reaching for a petite dessert dish instead of the mixing bowl may help you curb your ice cream consumption. Grabbing a basket rather than a shopping cart helps control how many “necessities” you pick up at the store.

Similarly, trading your office garbage can for a daintier disposal bin may remind you to send less trash to the landfill.

In June 2010, faculty, staff and administrators at Dartmouth College in New Hampshire had their desk trash cans replaced with six-inch-tall cartons. One year later, Dartmouth has sent 200 less tons of trash to the landfill, and recycling is up by one third.

Energy efficiency still elusive

The European Commission has published a new draft directive on energy efficiency, but the targets are voluntary rather than binding, and many critics fear it will be as toothless as those measures that went before it.

Nissan works on recharging Leaf with solar power

YOKOHAMA, Japan (AP) — Japanese automaker Nissan is testing a super-green way to recharge its Leaf electric vehicle using solar power, part of a broader drive to improve electricity storage systems.

Nissan's Leaf went on sale late last year, but the automaker is looking ahead to about five years time when aging Leaf vehicles may offer alternative business opportunities in using their lithium-ion batteries as a storage place for electricity.

GM helps electrify city buses

General Motors (GM) has gotten lots of buzz for its Chevy Volt, but the automaker's most important electric vehicle contribution may not have anything to do with autos at all.

GM today announced a partnership with Proterra Inc., a Golden, Colo.-based maker of "zero-emission commercial transit solutions." More specifically, Proterra makes fast-charge electric buses and automated bus charging station (10 minute recharges). Its initial vehicles were rolled out to Pomona, Calif. last September, and both San Antonio and Tallahassee have signed up for later this year.

Green jobs pay better as clean-tech sector booms

Clean-tech jobs offered median wages 20% higher across the United States in 2010, according to a report released today from researchers Brookings and Battelle. Such green jobs span industries ranging from solar-panel manufacturers to wind- and ocean-based energy production to electric-vehicle technologies.

The trouble with green product ratings

FORTUNE -- Two years ago this month, Wal-Mart CEO Mike Duke dropped a bomb on the retailing world by announcing that the company would spearhead an audacious effort to create a "sustainability index" that would reassure the environmental and social impact of every product sold in its stores. Though the move was generally praised by environmentalists, Wal-Mart had not suddenly turned green -- it turns out a vast amount of money is to be made by reducing energy and waste up and down the supply chain. As the world's largest company, Wal-Mart had the clout to enforce its implied threat, later made explicit by Duke's lieutenants: Treat the planet well and get prime access to its 200 million customers each week; pollute and despoil, and you will be shunned.

6 'green' products: How green are they?

he trouble with consumer scoring systems is that consumption is really about give and take. All products - no matter how 'green' - impact the planet in some way.

G.O.P. Bid to Void Light Bulb Law Fails

WASHINGTON — House Republicans on Tuesday failed to advance a measure that would repeal regulations that increase efficiency standards for light bulbs, rules that they have assailed as an example of government overreach.

Light bulb ban draws fire

The so-called light bulb ban, set to begin in 2012, has become a rallying point for conservatives, libertarians, and various free-market activists who deride what they see as unnecessary government interference in the marketplace.

The myth of baseload

While it is true that some renewable resources have different operating characteristics than current utility plants, some of those differences are positive, while others will require different operating procedures. The problem is not the variability or reliability of the renewable resources, but rather the desire by utilities to not change the way they operate their systems.

EPA says all Texas plants will get new air permits

HOUSTON (AP) — The U.S. Environmental Protection Agency says all 136 Texas plants and refineries operating with permits that violated the Clean Air Act have applied for new paperwork.

The EPA ruled last year that the so-called "flexible permits" violated federal law. The agency had said it was impossible to accurately measure air emissions at those facilities, which include some of the nation's largest refineries.

Japan May Miss Greenhouse Gas Targets If All Nuclear Plants Shut

Japan’s greenhouse gas emissions may rise by as much as 16 percent from 1990 levels should the country’s nuclear reactors be shut down, raising questions about its ability to meet carbon-dioxide reduction targets.

The great carbon tax secret: who are the Misfortune 500?

Listen to talkback for 30 seconds and you'll pick up what the general presumption is - a sort of vague impression that Big Polluters and Big Business are pretty much the same thing.

But who are these 500 big polluters, exactly - this Misfortune 500, who are to be history's martyrs to the answering of our generation's greatest moral challenge?

Al Gore’s Reality Show

Al Gore, the former vice president, Nobel Prize winner and climate campaigner-in-chief, is opening a new global climate change activism program called the Climate Reality Project.

The group’s first program will be a live-streamed event called 24 Hours of Reality and held on Sept. 14-15. According to a press release from the organization, “people all around the globe living with the impacts of climate change will connect the dots between recent extreme weather events — including floods, droughts and storms — and the man-made pollution that is changing our climate.”

Climate change could kill one in 10 species by end of the century

Climate change is speeding up the rate at which animals and plants are becoming extinct. By the end of the century, one in 10 species could be on the verge of extinction because of the effects of global warming, a study has found.

The findings support the view that the earth is currently experiencing a global mass extinction where the rate at which species are being lost is many times greater than the historical extinction rate. It is the sixth great mass extinction in the history of life on earth. Scientists said that previous predictions of how fast species are being lost because of climate change match the actual observed losses. They calculate that around 10 per cent of species alive today could be facing extinction by 2100.

More Arctic shipping will up local pollution: Study

With two to four months of ice-free conditions forecast for the Northwest Passage by 2030, scientists are now looking at what more shipping traffic will mean for the circumpolar region.

"The melting of Arctic sea-ice will effectively unlock the Arctic Ocean, leaving it increasingly open to human activity — particularly oil and gas extraction and shipping," say scientists at the Oslo, Norway-based Center for International Climate and Environment Research, the Det Norske Veritas foundation and Statistics Norway.

Arctic may be ice-free within 30 years

What concerns polar scientists is that thicker ice which does not melt in the summer is not being formed fast as the ice is melting. On average each year about half of the first year ice, formed between September and March, melts during the following summer. This year, says Jeff Masters, founder of the Weather Underground climate monitoring website, a high pressure system centred north of Alaska has brought clear skies and plenty of ice-melting sunshine to the Arctic.

The IEA’s Highlights of the latest OMR is out today.

Global oil supply in June increased by 1.2 mb/d from May, to average 88.3 mb/d, with OPEC crude rising by 0.8 mb/d to 30 mb/d as Saudi Arabia boosted supply. Non-OPEC supply is now seen averaging a lower 53.1 mb/d in 2011, on prolonged production outages, before rising to 54 mb/d in 2012. The ‘call on OPEC crude and stock change’ now rises by 1.3 mb/d in 3Q11 to 31.3 mb/d. It averages 30.7 mb/d for 2012, +0.1 mb/d versus 2011.

This differs from what OPEC’s Monthly Oil Market Report says.. They say OPEC increased production by 520,000 barrels per day in June.

The Financial Times says Saudi increased production by 700 kb/d to 9.7 million barrels per day in June. The OPEC OMR however says Saudi increased production in June by 461 kb/d to 9.419 mb/d in June. From the article:

The IEA expects the Saudi production increase to continue, with “sources from the market and within the kingdom” suggesting that output this month “might rise to as much as 10m b/d”.

It is important to note that the Financial Times gets their information from the IEA’s Monthly Oil Market Report which came out today. The link above is only to the highlights, which are free. The full report, which has their Saudi information, is available only to subscribers. It will be available free in two weeks. The important thing is the IEA differs significantly from what OPEC’s “secondary sources” says Saudi produced. We will get what Saudi themselves say they produced in a week or so when the JODI numbers come out.

Several of the links up top have the latest IEA Oil Market Report as their source also.

Ron P.

I assume that the IEA compiled this report only a week or so after the end of June. It seems to me that these very early IEA reports can't be much more than educated guesses.

In any case, the EIA currently shows data through the first quarter of 2011, and they show average Saudi C+C production at 9.1 mbpd for the first quarter. What do the available JODI data show for average Saudi production so far in 2011?

And of course, the annual BP data base shows that Saudi total petroleum liquids net oil exports have shown year over year declines for four of the past five years, with their 2010 net exports one-fifth below their 2005 annual rate.

As virtually all of this supposed extra crude production is supposedly being burned in Saudi power plants, very little has made its way to the export market. There was a brief surge in June but it has dropped off again according to tanker trackers Oil Movements

And in prior years, Saudi Arabia has had to import refined product in the Summer, and I don't think that these import numbers are easily accessible in the short term. This is of course is also one way to boost reported production/export numbers (importing product, while only reporting gross production/exports in the short term). And monthly data can also be distorted by inventory changes.

Virtually the entire governmental/media establishment seems determined to ignore the ongoing (five years so far) decline in Saudi net oil exports (relative to 2005).

Apparently Saudi Arabia may burn up to 1.2 million barrels per day of crude in its power plants on hot days this summer. That's one hell of a lot of electricity if true. They are also apparently ramping back up production at a major refinery which was down for maintenance. Will be interesting if we still hear of refined product shortages in the region going forward.

Some interesting "What If" numbers to ponder.

The BP data base shows that Saudi Arabia's ratio of domestic oil consumption to domestic production (C/P) rose from 18% in 2005 to 28% in 2010 (total petroleum liquids), and Saudi Arabia net exported 9.1 mbpd in 2005 (down to 7.2 mbpd in 2010).

At this rate of increase in the C/P ratio, Saudi Arabia would approach 100% (and thus zero net oil exports) around 2025 (20 years after the 2005 peak).

Using some "sophisticated" integration techniques (2005 annual net exports X 20 years X 0.5, i.e., the area under a triangle), the C/P ("Cowboy Integration") extrapolation method gives us post-2005 Saudi CNE (Cumulative Net Exports) of about 33 Gb.

Post-2005 CNE have so far been about 14.6 Gb through 2010, so in round numbers, using this C/P method, Saudi post-2005 CNE would be about 45% depleted. (Incidentally, this C/P extrapolation method works reasonably well for some, but not all, net export decline case histories.)

Note that several net export decline case histories, e.g., UK, Indonesia, Egypt (and the ELM), show that about half of post-peak CNE are shipped about one-third of the way into net export decline periods:


A WSJ blog post makes three points about the IEA data, even if we take the reported short term Saudi production increase at face value (BTW, doesn't the IEA report total liquids?):

Oil Production: Running to Stand Still

Oil supply from countries outside OPEC for 2011 was revised down by 0.2 million barrels a day because of “prolonged production outages” in a number of important oil producing regions, the IEA said. Such disappointment is an increasingly common occurrence as non-OPEC producers struggle with aging oil fields, complex technical problems and hard-to-access resources.

Oil demand in the developing world “is continuing to run ahead of supply” and high prices are having limited effects because of subsidies and rising incomes that offset the impact of more expensive oil, the IEA said.

More oil is increasingly being consumed at source. The Saudis pumped an extra 0.7 million barrels a day in June, but half of this was consumed domestically, by refineries and power plants, according to the IEA. The amount of crude oil Saudi Arabia burns in its power plants has more than tripled in the last five years and ultimately may cap future exports, it (IEA) said.

According to Intellicast, tomorrow’s high temp in Riyadh, SA, will be 118 degrees F, with an overnight low of 94. That even higher than Phoenix, at least for this week.

with an overnight low of 94.

I can't even wrap my mind around that. Utterly miserable.

And somehow millions of people live there. Mind boggling. A huge misallocation of natural resources.

Not very good looking in the long term though. What is the birth and death rate looking like for KSA?

And somehow millions of people live there. Mind boggling. A huge misallocation of natural resources.

Let he who is without sin, cast the first stone!

Air-Conditioning Actually Emits Less C02 Than Heating

As a symbol of American profligacy, the air conditioner may rank second only to the automobile. Energy-sucking AC props up an unsustainable lifestyle in scorching desert cities like Phoenix, while the cheerful New Englander splitting wood and tending his potbelly stove is the epitome of ecological harmony - so goes the green cant. But this stereotype gets it wrong. When it's 0 degrees outside, you've got to raise the indoor thermometer to 70 degrees. In 110-degree weather, you need to change the temperature by only 40 degrees to achieve the same comfort level.

The Energy Costs of Cooling and Heating a Home

...both heating and cooling your home take large amounts of energy, more than we use for any other appliance. But according to researchers at National Geographic's The Green Guide, you will probably consume more energy heating your home than cooling it.

Virtually the entire governmental/media establishment seems determined to ignore the ongoing (five years so far) decline in Saudi net oil exports (relative to 2005).

The graph showing this export decline is on my website:


The EIA's production level for Saudi Arabia is too high since the 2nd half of last year

Even with these high figures, in March this year, we were just back to 2005 levels.

The avarage for 6 years was 73.4 million barrels per day crude oil.


Explanations are here:


Contrary to earlier warnings, the EIA continued updating international energy data. We don't know for how long. The August deadline looms.

Even with these high figures, in March this year, we were just back to 2005 levels.

The avarage for 6 years was 73.4 million barrels per day crude oil.

Six years of a crude oil undulating plateau extraction rate, in which we find the worlds economy's also undulating on a fine line between collapse and borrowing. And that borrowing takes many forms, from actually borrowing to printing money via QE's, both of which cause inflation (as can best be seen in the ongoing rise in the price of gold).

What will happen if what some think will happen comes to fruition, i.e. the shark fin of oil depletion in 2012, 2015? Won't that amount to the final coup de gras? Of course a coup de gras is a death blow of mercy, and maybe what is going to happen cannot be best termed as mercy. Although there is that scene in 'Waterworld' in which a firebomb is dropping into one of the fuel holding tanks, someone is standing knee deep watching it drop knowing in a brief moment the whole rig will blow and he says with sincere relief, "Oh, thank God", even though it means the end of his life.

I suppose it will depend individually on when the BAU is over and how bad that new situation is - oh my!

As I state above the IEA says OPEC production increased by 800,000 barrels per day in June. OPEC's OMR says they increased by only 520,000 barrels per day. Yet Tanker Tracker Oil Movements say that OPEC deliveries only increased by 170,000 barrels per day.

"Oil Movements"

OPEC Mideast Sailings To Rise By 170000 B/D In 4 Weeks To Jul 30-Tracker
Zawya (subscription) - ‎2 hours ago‎
... Petroleum Exporting Countries, excluding Angola and Ecuador, are set to rise by 170000 barrels a day in the four weeks to July 30, UK tanker tracker Oil Movements said Thursday, as a pledged Saudi output boost starts showing up in seaborne exports....

The article is behind a pay wall and cannot be accessed even via Google. The above is the header displayed by the search engine.

Ron P.

There's not more reported from an article by Reuters.

This is the first notable weekly uptick in about a month, with most of the increase concentrated near the end of the month (report covers expected exports until July 30).

It's not clear if the OM export figure includes the 100,000 bpd that KSA is shipping to Yemen for free, which started in the late part of June.

However based upon other shipping reports, OPEC exports to the 'West' haven't increased in July vs. June. The incremental output of KSA appears mostly going to internal needs, with a smaller portion to Yemen and India.

My guess is that this marginal increase in OPEC exports will be maintained in August. At the level of exports of 23 mbpd, OPEC exports are still down about 1.1 mbpd from their peak in 2011 - shortly before Libya went offline. Libya was exporting about 1.3 mbpd at that time.

From up top: Fracking Water Killed Trees, Study Finds

This story has popped up again. "A study that argues for more research into the safe disposal of chemical-laced wastewater resulting from natural gas drilling." Total BS IMHO. No additional studies need to be conducted. Frac fluids have been known to be very toxic for decades. And in case you don't bother to read the whole story this wasn't an accidental discharge of frac fluids. The university intentionally sprayed a 1/2 acre of the forest. Everyone in the oil patch knows frac fluid kill vegetation. Heck, it cripples and kills people. The hands that make up frac fluids wear hazmat suits. This is not a big revelation but I suppose it did get the university some grant money. Who knows...maybe they can get some more grant money to prove that cyanide kills puppies.

The report also states efforts should be made to find safe disposal methods for frac fluids. Don't need the effort. Texas found out how to do it decades ago. Just inject the frac fluid into deep disposal wells from which it will never reach aquifers or see the light of day. Yep...expensive: getting rid of 1 million gallons frac fluid could cost $200,000. Just the cost of doing business in Texas. If we can pay it so can the operators in PA and NY.

And if you didn't catch the earlier reports: they discovered the source of much of the frac fluid contamination in PA and NY. It wasn't from the frac'd wells or illegal dumping. Turns out local waste treament facilities were letting operators dump the nasties into their systems (for a fee, of course) which was then discharged back into the environment. Both NY and PA have recently passed laws making it illegal for municipalities to continue this practice. You would think you didn't have to pass laws forcing local govt's to not discharge poison into the environment.

The study probably made sense, quantify the effect, what concentrations kill how many trees, etc. Then if mysterious dead spots are detected, forensics as to who did what when can be done. Of course the headlines are terribly deceptive, with the first impression being that illegal disposal or accidents are implicated in the dieoff.

The study well seems to have gone out of control. Anyhow, the original document is a good read.


EOS - Valid point except that they dumped 70,000 gallons on the ground. They didn't just spill some frac fluid on an 1/2 acre of ground...they flooded it. In Texas it's illegal to dump a few gallons of frac fluid on the ground. There is no safe level of concentration for surface disposal of frac fluids in Texas. There's even no safe level of salt water...can't put a few gallons of it on the ground without catching hell from the TRRC. Why not just pass the same laws every state as we have in Texas: deep injection well disposal. Get caught putting it on the ground and go to jail.

Why not just pass the same laws every state as we have in Texas

Isn't there some Texas guy named Perry that is going to try put himself in a position to do just that?

paul - So far we've survived President Bush and President Obama. Just MHO but I don't think we should push our luck with a President Perry. LOL.

"I don't think we should push our luck with a President Perry. LOL."

I had a flash of Perry the Platypus for president. Thanks daughter.

Then again, he couldn't do worse, and at least there would be no more pompous speeches.

The study probably made sense, quantify the effect, what concentrations kill how many trees, etc.


Cynically I predict that next steps will be EPA findings on the 'acceptable' ppm in drinking water.

Btw, the EPA is prohibited by law from regulating fracking chemicals under the Clean Water Act. This absurd law was signed into law by G.W. Bush. That, right there, tells you there is an obvious problem with these chemicals.

Rock, none of this is really about finding out if something is toxic. The reason grants are given to do all these studies is so people can have "100% certainty" that what they are doing is causing a problem. Meanwhile, they go right on doing it until the studies are completed. Then, after that, they set the lawyers loose to dispute the findings in court, tying things up as long as possible with appeals.
Typical "Delay" strategy.

We "know" that all sorts of chemicals are toxic. Part of the problem is that although we "know" this, proving it to the satisfaction of a court or to a regulatory body is another issue. Texas, apparently, had the good sense to regulate these chemicals years ago. Good on them although, in my mind, I have trouble associating the words "Texas" and "regulation" in the same sentence.

In general, however, there are thousands of chemicals that are released into the environment in consumer products and elsewhere that are unregulated and untested. Over the years, the number of chemicals that have been banned or adequately regulated is a small percentage of the chemicals released. The fact is, we just don't know what all these chemicals are doing to us or the environment and our laws make it impossible to find out or so onerous and expensive that it never gets done. If EPA tries to ban or regulate any chemical, they will be subject to years of lawsuits, effectively nullifying their efforts.

I think this study was probably considered necessary because of the absurd regulatory environment that exists both nationally and locally. They have to start by proving beyond a reasonable doubt that these chemicals kill plant life. And then I guess they will have to do the same for animal life, hence the possible puppy experiments.

I have a friend who spent decades in the oil industry as a geologist who has a son who is currently in the industry and is doing fracking. They have their chemicals "disposed" of by a contractor who takes them "some place". The son doesn't know where that some place is. Uncurious minds don't want to know, I guess.

spring/ts - There's no lack of certainty. Have you read the labels on the frac fluid ingredients? I have and it scares the heck out of me. And I work around equipment that could kill me at any moment and that seldom bothers me. What's my safety policy when they're mixing this crap on of my wells? No company employees on the drill site. Same policy I have when they're revving up 800,000 horsepower and there are dozens of flow lines running across the ground with enough pressure to cut a man's legs completely off if a pin hole leak develops. Frac'ng, and the frac fluids, are dangerous and no one can deny that fact. And no one in the oil patch does. They don't just say the components are toxic...they say they are deadly and extreme caution should be used in handling and disposing of them. Did you see my comment about two hands who were accidentally exposed to frac fluid: one was crippled for life with 30% of his body covered in chem burns and the other had both feet amputated. The companies never have nor ever will argue otherwise. There is nothing to prove in court...the frac fluid manufacturers have already ready certified the facts.

The university killed a 1/2 acre of forest (at tax payer's expense) to prove what the companies have already admitted. You guys are confusing the different issues. What the companies have been arguing is the frac'ng process itself isn't putting those nasties into the environment. And as I repeatedly pointed out there's almost no history of it happening this way. Improper disposal is the problem. The EPA doesn't have to ban any chemical no matter how deadly it is. There are umtenth millions of gallons of deadly chemicals used in this country every year. But they do have to regulate their use to minimize or completely eliminate any danger. If you put the CEO of any frac fluid manufacture on the witness stand and asked him if vegetation exposed to frac fluids would die and he would readily admit it. There is no argument. In fact, the governors of both PA and NY agree with him: they both passed a law making it illegal to dump frac fluids into municipal treatment centers. Or let me put it this way: find one statement from anyone in the oil patch that says frac fluids are not toxic and wouldn't be harmful to the environment if exposed to it. Go ahead...I dare you. LOL.

"They have their chemicals "disposed" of by a contractor who takes them "some place". The son doesn't know where that some place is. Uncurious minds don't want to know, I guess." And that was the point I made long ago: stop worrying about what's going on during the frac'ng process. Keep an eye on those harmless looking tank trucks going down the highway at 2 AM. I thought it might be "midnight haulers" making illegal dumps. Turns out they were hauling to municipal treatment centers where they were "legally" dumping their loads with the full knowledge of local authorities.

How about this ?

"Fracosaurus teaches kids about natural gas drilling".


Never mind. Withdrawn.

s_t - Interesting. But propaganda always leaves a bit of bad taste in my mouth even if it supports my position. I wish Talisman and Chesapeake had the guts to show the whole story including the real problem: improper disposal of frac fluids. Yeah...a little stink would rub off on them but better to put a bright spotlight on the real problem instead of adding more confusion/distrust to the conversation IMHO. Had they done that a year+ ago then maybe the stories about municipalities allowing frac fluid dumping into their systems would have come to light sooner. But the operators were happy to keep this little dirty fact secret since they benefited finacially. Technically they weren't doing anything illegal. Morally dispicable but still legal.

If you didn't catch it: last week the NY gov lifted the ban on frac'ng once they realized the source of the problem: improper disposal and not the actual well frac'ng itself. He passed a law making it illegal for the sanctioned surface disposal to continue. I'm sure the operators were paying the municipal waste treament centers just a small fraction of what it worth to take the nasties off their hands.

Rock, aren't those advancing this controversy ignoring the fact that all oilfield brines have to be disposed of in deep isolated zones?

You may already have stated it, but the big cost driver associated with disposal of brines [that are not tied directly into a disposal well] is the cost of trucking, not the cost to inject [or gravity feed] the stuff into a commercial disposal well. Beyond that, once the stuff is on the truck, in active areas of North TX or Central OK at least, a disposal well isn't very far away.

What that leaves me with is a scenario where a colosal jackass is trying to save $25 to $50 a load by dumping the stuff on a country road at the risk of some jail time and huge monetary outlays. You can't fix stupid, but I suspect if they try this stunt with any frequency jail time is in their future and their performance bonds are toast.

RW - You're right about salt water disposal. Which makes me wonder what the rules are in Yankee land. In reality salt water contamination is consider a much bigger sin in Texas. The great majority of money I've spent has been for salt water disposal: either spending $1 million+ for a SWD well on the lease or paying $4-7 for hauling and disposal. But my Yankee cousins obviously have a more tolerant attitude about salt contamination: they dump millions of pounds of salt on their roads in the winter. makes me wonder if instead of spending a big chunk of my budget on disposal I could sell my brine to the county and they could spray it for ice control.

We still have midnight haulers (illegal dumpers) in Texas but not nearly as bad as it once was. There are fairly thorough paper trails that not easy to cheat on to a large scale.

Oh Rockman,

You know hype is what some need to get press. Oil will kill forests too last I heard.
Heck natural gas and a match will burn most of California's forests on the right day in the summer.

In the article re: conspiracy theory....the statement; "Forget supply and demand; budget-busting high oil prices are the result of speculation on “paper” barrels of oil—and manipulation."

Let's see, there are no limits of supply and/or production of oil so let's speculate and make some money; yeah riiiiight, that's a good idea. We could do this with housing too. Oh yeah, that won't work because the supply is too great. How about potatoes? Oh shoot, there are lots of potatoes. How about computers?

Who are these people? Sure, there is speculation which may increase the price, somewhat, but one doesn't speculate in a product that is abundant unless there will be an actual shortage. I think that would be called stupid and going broke. The sad thing is, these one- liner statements are designed to cast thoughts away from the truth and the need for change and possible solution. When I talk to friends about the changes we are facing and experiencing, I often hear this 'speculation nonsense'. As long as it is out there, it continues to be the lifering of BAU and promotes a head in the sand thought process.

I guess when tshtf, we can blame somebody else, all over again. It is starting to sound like this is a process of 'whipping up the masses' in order to manipulate them into selfish action; either to make money or consolidate power.


I have been reflecting recently, in a different context, on the remarkable ability that many people seem to have to believe two contradictory things at the same time without being aware of it. I wonder if many of the same people who believe that prices not only are but ought to be set by supply and demand also believe simultaneously that prices ought to be set based on cost of production (as long as they are buyers and not sellers, that is).

Don't forget that there are paper gallons of gas as well. Since the price of paper gallons of gas have gone up in price, I have switched to liquid gas. Makes all the difference. If paper gallons of gas increase the price of liquid gallons of gas at the pump, demand will go down. But we are supposed to forget supply and demand, so I guess the analysis stops there. Anyway, wholesale gas is back up so I guess the impact of the news about SPR release was just a short downward blip on the march of the price of gas, whether paper or liquid,onward and upward.

And why do they call them paper barrels, anyway? Have we not moved on from paper? That metaphor right there makes me skeptical.

In other news, it looks like we will be tortured by the debt ceiling debate until the next election. So productive.

ts - Maybe you're just teasing. But you do know what the "paper barrels" are? When someone buys oil future contracts for 1 million bbls of oil those barrels only exist as a number on a piece of paper. That actual oil never has nor ever will exist except on paper. But I think you know this. But that's why there are around 1 billion bbls of oil traded on the exchange every day. Those bbls don't exist other than in a cell on some spreadsheet.

But I do like your idea of not filling up with paper bbls of gasoline...smart move. But, on a serious note, I don't know how different we are in Houston then the rest of the country but retail gasoline prices here were already dropping when the SPR release was announced and continued until a week or two ago. But now they've shot back up a good $0.30 across the board. Even more odd: the three truck stops close to me always had the lowest prices. But yesterday I noticed the majors including shell and Chevron, were running arounf $0.15 cheaper than the truck stops. I thin the truck stops tend to buy on short term/spot contracts. Wonder what that might mean for the immediate future.

Paulo, don't get too excited. The article is all about what Raymond J. Learsy says in his book. Learsy, a frequent contributor to The Huffington Post has been singing this song for years. He blames speculators and OPEC for high oil prices. He puts the heaviest blame on the CTFC, (U.S. Commodity Futures Trading Commission), for letting speculators run up the price of oil. This ignores the fact that this speculator driven WTI is the cheapest oil in the world. The NYMEX does not drive world oil prices, that is absurd.

And of course Mr. Learsy never explains how speculators are able to keep prices so high for so long, since 2003 he claims. Futures contracts expire every month. Speculators must eventually sell every contract they buy. Learsy never explains why their selling does not have the same impact on the market as their buying. This is, I suppose, because the oil market is all a fog to him. He doesn't really understand the futures market and for sure he hasn't a clue as to how the world spot market works.

Ron P.

Raymond J. Learsy

Every other article is either about speculators and Opec, or it's about "peak oil pranksters"

I'm sure it works like a charm

I guess when tshtf, we can blame somebody else, all over again. It is starting to sound like this is a process of 'whipping up the masses' in order to manipulate them into selfish action; either to make money or consolidate power.

Not to worry, Paulo... They would never do that!


Detroit muscle-car mania is back.

For the first time since the Carter administration, three big Detroit brands, Ford, Chevrolet and Dodge, all offer rear-wheel-drive coupes that boast a distinctively American blend of in-your-face styling and big horsepower numbers.

How big? Try a 444-horsepower 2012 Ford Mustang Boss 302, which can be ordered with a special "Laguna Seca" package that essentially makes it a street-legal race car. Or consider the forthcoming 2012 Chevy Camaro ZL1 that will deliver 550 horsepower from its supercharged V-8. Meanwhile, Chrysler LLC offers a Dodge Challenger model with a 470-horsepower Hemi engine that can run from 0 to 60 miles per hour in under five seconds.

These monster engines are shoehorned into back-to-the-future body styles that telegraph the core target market for the cars: baby boomers who lusted for these cars in their teens and 20s, but settled for Japanese compacts, minivans and sport-utility vehicles. Equally important to Detroit marketers, though, is capturing the imagination of car enthusiasts who don't remember the '60s and '70s — they weren't born yet.

"It's the attitude of the customer," less than demographics, says Mustang brand manager Jim Owens, who has a customized Mustang of his own that packs 650 horsepower under the hood. It is an attitude that says, "Hey, look at me!" he adds.

Poor babies, they had to settle for sport-utility vehicles?! M'kay!

I'm looking, and its looking an awful lot like a Thelma and Louise moment to me.

"Suicide is painless, it brings on many changes, and you can take or leave it if you please"

Right-- and look at the dismal choices offered for economy-minded sports car drivers, also courtesy of yahoo auto:


The Honda CRZ is a disgrace, both in terms of performance and fuel economy. My '91 CRX HF nearly committed sepukku when that monstrosity started rolling out of dealerships.

The Challenger's 0-60 time south of five seconds? If I wanted that kind of acceleration and had 43 grand, I'd much rather have an '05 Lotus Elise that gets 30 MPG cruising on the highway, and would destroy the Challenger in canyon driving.

This is the best we can do for high-performance and high fuel-economy on the mass market? It is so hard to believe there is a valid engineering reason for this. It's also hard to believe people would not buy a 50+ mpg sports car if it was available.

I don't understand your focus on performance cars and acceleration. Sports cars are toys for the wealthy and basically irrelevant for the future that is coming our way (at least for most of us). 30mpg is pathetic for a vehicle the size of an Elise, especially when it can only be used to transport two people.

There was once a time when I considered such things to be important too, but in a world where lack of sufficient fossil fuels is going to mean we cannot produce enough food to feed people, the idea of using such fuel for entertainment becomes rather distasteful. So yeah, I can still heel-toe double clutch downshift while matching revs and trail braking through a corner, I understand slip angle and how to adjust for oversteer, and I remember how to tune a Weber and port a head, etc. - but these things are irrelevant now and forever onward. It's time to recognize that automobiles for sport and entertainment, as objects of desire and as avatars of our personalities is done. The car culture has cost us far more than we've realized and cannot be supported without fossil fuels.

It's time to recognize that automobiles for sport and entertainment...

Forever is a long time for which to make predictions. That aside, let's not forget panem et circenses - stripping a swath of coastal North Africa of large game and all that. Boredom can be a powerful force; even in a fairly bad scenario some variant of Nascar might persist a lot longer than some would like to think.

Correct, you do not understand.

Statistics such as 0-60 and miles per gallon are simple stats that can be used to illustrate false economies and created needs. Many of my clients are out of work, they need to retrain for different careers, and they have very unrealistic ideas about what the future is going to look like. I have to start with easier, more basic questions, like, "I'm curious-- why is it that you want to buy a 450 horsepower car?" I need to speak to people in language they understand and find creative ways of challenging maladaptive belief systems and rebuilding them from the ground up.

I do not have the luxury of lecturing people about what cultural icons they should be embracing. It's not a good use of resources to explain to people what they should or shouldn't want; it may make you feel better, but don't imagine it accomplishes anything. It's like trying to get someone to quit smoking by nagging.

My arguments about what kind of vehicle I might purchase if I had X amount of money are purely rhetorical. I have no interest in buying another vehicle, particularly a new one, for the rest of my life. As you correctly point out, I won't be able to drive it that long anyway.

I don't feel particularly guilty about enjoying the cars I have. I don't drive very much, and our household's carbon footprint is probably one of the lowest in our zip code. A lot of my job right now is trying to keep people from jumping off buildings and trying to help them find homeless shelters, so I don't beat myself up if I break the speed limit every now and then.

Also, note that I engaged Jeppen in a dialogue about cars on the Fukushima thread was diversionary... I was trying to draw him onto the sidelines of the discussion where he would not get in the way.

Which was really interesting. He did get me to look at the website for the Westinghouse AP-1000.

Like the Challenger, I thought it was an overpowered piece of junk, and looked like it would be really, really hard to work on.

Nice retort. And keep up the good work!

OK, that wasn't very clear from previous comments.

The act of driving itself is still sometimes enjoyable, but that's tempered by an understanding of the costs, so I only drive because I must in this society built around the automobile. I wish there were other transportation options, but the job I drive to and the driving won't last much longer anyway. My focus now is on driving for high mileage, and one effect of that is that I don't slow down for corners much - so some of the old techniques are useful I guess.

The vast majority of people in this country, and several others, have "very unrealistic ideas about what the future is going to look like". I don't think many will have time to adjust those before fuel prices make the choices they've made, and are making now, very maladaptive. Still, good luck with your efforts to help.

EDIT: One of my problems with sports and performance cars (like 500hp retro pony cars) is that they are used to aggrandize the automobile and perpetuate the car culture. They are advertising and marketing tools used to sucker more people into choices that will hurt them later. Or maybe sooner.

Well put... that's sort of how I'd like to reframe the argument: A true motorhead can only be insulted by a contemporary pony car.

Another sort of sneaky trick I use when people covet vehicles like this... "Oh, you like the Hemi? The one that looks like this:


"Pardon me for asking, but... do you think that looks like it would be a lot of fun to work on yourself?"

And true motorheads, like the smartest football players, television writers, and coke dealers, knows when it's time to move on and get out of the game. Sometimes it's because you're too old and not as fast as you used to be, sometimes it's because the rules changed and the old moves aren't going to work anymore. The main thing is not to be in the driver's seat when the tank's empty and the flashing blue lights come on.

See? I think we can sell this. Make it sexy. I think we can make this part of the American Dream.

Then again, I'm frickin' crazy. That's why I'm a psychotherapist.

Anyway, thanks for the positive energy-- and the critical thoughts, too. If I'm sounding like an old fart who is still mired in the car culture, there's probably some truth to that, and it's something I need to be aware of.

I have my own thoughts of how to change large numbers of minds. Fear, Hope and authority are key IMVHO.

When I have more time I would like to discuss this with you.

Is your contact in your profile ?

Best Hopes,


Negative, not yet, but I will figure out how to do that or post it tomorrow, would enjoy that conversation...

Mine is, spambot protected, alan_drake at ju no period conn. Remove the space in ju no and standardize.

Best Hopes,


My first comment here. Too bad this is what I'm adding to the discussion, but here goes.

Since starting reading this blog after the Gulf Blowout (such strange serendipity that...), and having long considered that no environmental or other limits will be observed by humans before TSHTF, I've decided to enjoy driving and what remains of our North American way of life so long as it lasts and I am able. Stupid, mindless and ignorant I know, but after long consideration of how everything is going to hell in a handbasket, I figure I might as well enjoy the ride and enjoy my cake while it is still there to be enjoyed.

I suspect that I am a member of a not so small group that is aware of what is going on, but feels largely helpless to overcome the forces of human nature and capitalism to enable any other outcome, and just basically doesn't care. Que sera, sera.

This discussion of cars just forced me to add my 2 cents. I have an '05 Acura TL that I like to drive like the dickens. It's my small pleasure in life. That this small pleasure must be sacrificed in advance of the end of oil in some attempt to achieve a more liveable future seems like adding unneccesary insult to injury. I pay the price in my extraordinary gas bills. I'll enjoy the forecast blackouts, deprivations and devastation caused by climate change due to the switch to coal to meet our energy needs soon enough. Today, I will drive with the windows and moonroof open and I will blissfully enjoy the ride.


The Wet One

Hehehe good luck to you! and why not enjoy the ride. Welcome to TOD.

I reckon this wont be your last post - and it will be interesting to see your posts in the future. Maybe I can in a year or two link to this one ;)

I suspect that I am a member of a not so small group that is aware of what is going on, but feels largely helpless to overcome the forces of human nature and capitalism to enable any other outcome, and just basically doesn't care. Que sera, sera.

Wet One, my sentiments exactly. However I do care, and I would not have included capitalism as being responsible for our human predicament. I do care for the massive human suffering that will soon befall all of us. But only those with visions of grandeur believe they have the power to fix all the problems that human overshoot have brought us in this age of exuberance.

Ron P.

What about those that want to "Make things slightly better than they would otherwise be".

IMO, a worthwhile, and borderline realistic, goal,


Read your post. Thought of John Gray:

Those who struggle to change the world see themselves as noble, even tragic figures. Yet most of those who work for world betterment are not rebels against the scheme of things. They seek consolation for a truth they are too weak to bear. At bottom, their faith that the world can be transformed by human will is a denial of their own mortality.
John Gray, Straw Dogs

;-) Ron P.

“Pray for the dead, and fight like hell for the living.”
Mother Jones

I think I am past that point. I am acutely aware that I have only two, and at best three, good decades left.

The question is what to do with the time left ?

I see a broad array of personal options and have chosen to fight the fight I have chosen above all other choices. The goal is set at the outer limit of reasonableness - Making a bad situation slightly better than it would otherwise be. Difficult, but not impossible.

I do NOT look for meaning in a noble fight, well fought, but tragically lost. Instead I look to win. By any devious and manipulative means at my disposal, or that I can create.

I am aware that one can sell one's integrity but once, and I hope to not see that day, but that too is possible if the stakes are high enough.

Best Hopes for Winning the Fight !


And my best wishes to you Alan. You are fighting the good fight while I am doing nothing but kicking back and watching things play out. But then I don't have even one good decade left.

Best to your efforts also,

Ron P.

Thanks ! :-)


I feel the same way. I've been travelling a lot while prices are reasonable.

I pay the price in my extraordinary gas bills

No, you don't, not even close to all of it. But don't worry, someone will pay the rest for you. But then you don't care anyway.

I'm not actually trying to change your behavior or that of anyone else, as I'm well aware that the world is full of people who could not give a rat's a$$ about anything other than their own pleasure and comfort and will not sacrifice one whit for any common good. That's hardly news, nor is it some new thing brought on by peak oil, which is why there are already so many colorful terms for people such as yourself.

What I can change is my own behavior, and so that is what I'm focused on.


Summary of Weekly Petroleum Data for the Week Ending July 8, 2011

U.S. crude oil refinery inputs averaged 15.2 million barrels per day during the week ending July 8, 97 thousand barrels per day below the previous week’s average. Refineries operated at 88.0 percent of their operable capacity last week. Gasoline production decreased last week, averaging nearly 8.9 million barrels per day. Distillate fuel production increased last week, averaging almost 4.5 million barrels per day.

U.S. crude oil imports averaged 9.0 million barrels per day last week, down by 854 thousand barrels per day from the previous week. Over the last four weeks, crude oil imports have averaged 9.2 million barrels per day, 352 thousand barrels per day below the same four-week period last year. Total motor gasoline imports (including both finished gasoline and gasoline blending components) last week averaged 752 thousand barrels per day. Distillate fuel imports averaged 109 thousand barrels per day last week.

U.S. commercial crude oil inventories (excluding those in the Strategic Petroleum Reserve) decreased by 3.1 million barrels from the previous week. At 355.5 million barrels, U.S. crude oil inventories are above the upper limit of the average range for this time of year. Total motor gasoline inventories decreased by 0.8 million barrels last week and are in the lower limit of the average range. Finished gasoline inventories decreased while blending components inventories increased last week. Distillate fuel inventories increased by 3.0 million barrels last week and are in the upper limit of the average range for this time of year. Propane/propylene inventories increased by 3.1 million barrels last week and are below the lower limit of the average range. Total commercial petroleum inventories increased by 4.3 million barrels last week.

Total products supplied over the last four-week period have averaged 18.9 million barrels per day, down by 1.5 percent compared to the similar period last year. Over the last four weeks, motor gasoline product supplied has averaged 9.2 million barrels per day, down by 0.9 percent from the same period last year. Distillate fuel product supplied has averaged 3.5 million barrels per day over the last four weeks, down by 5.2 percent from the same period last year. Jet fuel product supplied is 1.4 percent higher over the last four weeks compared to the same four-week period last year.

Distillate fuel product
supplied has averaged 3.5 million barrels per day over the last four weeks, down
by 5.2 percent from the same period last year.

Either inventories are being reduced or perhaps the economy isn't doing better as claimed.

Immediate jump up $1.50 on the news for WTI - now at $98.50, Edit: Brent now $119.37. RBOB Gasoline $3.15

Usual upwards adjustments in the report totalling 405,000 bpd (crude + product). Crude stocks at Cushing said to have risen 0.6 million barrels last week - although the recent trend interestingly is down. Crude stocks at Cushing are 4.3 million barrels lower than the record high at the start of April.

Still no release from the SPR, which is 726.5 million barrels.

If you take a short term view, the report looks good. Consumption is down 1.5% from last year, stocks are fine, domestic production is up.

What ever happened to Bobby McFerrin?

Total product supplied is notably 400,000 bpd below the 4 week running average and 719,000 bpd below last week. It is likely larger consumption values will be reported next week.

US Refiners struggle to maintain output as oil supplies fall again

More than three months after OPEC, especially Mideast OPEC members such as Saudi Arabia and Kuwait, started to ship more of its exports to the ‘East’, exports from the Mideast to the US are lagging the levels of a year ago. While a part of the overall loss in OPEC exports relates to losses from Libya, other OPEC members are also exporting less to the US. Exports from Kuwait to the US actually fell to zero, as in none, for the entire week. Per the tanker tracker, Oil Movements, which OPEC itself uses for guidance, exports in recent weeks have fallen further despite many statements from OPEC that, for example, KSA has increased ‘output’ by 500,000 bpd in June. Although there is some evidence that a combination of output and storage withdrawal did increase KSA output by that amount, OPEC exports in recent weeks have actually fallen below the levels of early June by about 200,000 bpd. The discrepancy may be mostly due to increased domestic demand – mostly for summer air conditioning and transportation – but also because it is sending 100,000 bpd to Yemen for free (as no other country is willing to sell oil to them). While not a huge decrease in OPEC exports, the recent drop is not a reassuring trend about how OPEC intends to make up for the shortfall in oil supplies lost by Libya gong off line.

Overall US refinery utilization fell 0.4% to 88% last week, although utilization in the East Coast area improved by 5% as some refineries idled by unexpected maintenance returned to service. However the more important Gulf Coast region was hit by a series of new unexpected refinery operational problems, reducing utilization by 2.9%. Even so, shipments from the Gulf Coast to the northeast US sent through the largest national pipeline system, the Colonial pipeline, improved to where the pipeline recently operated at or near maximum capacity for diesel and gasoline shipments.

Meanwhile the gasoline import outlook, while less important than US refinery output, was deteriorating in recent weeks. Imports are running about 25% less than normal seasonal trends. As mentioned previously, Algeria and other north and west African nations have increased their gasoline demand considerably this summer – taking away some gasoline shipments that otherwise may have went to the US. Also while the gasoline export situation in Russia is gradually improving, it is far below the levels that prevailed just a few months or so ago.

Despite indications that the US economy has very little growth, gasoline demand is still very near the levels of one year ago (over the last four weeks compared to last year) – even with significantly higher prices. In the last few days, gasoline traders report that supplies in the key New York City are still fairly low. The only way the US may safely make it through the rest of the summer driving season with adequate supplies is by the rapid deployment of high quality oil to be distributed from the Strategic Petroleum Reserve. Hopefully those supplies will be shipped in time to those refineries that need it – particularly in the Northeast US.

If today's action doesn't convince you that the Fed will do Quantitative Easing to infinity, then nothing will. This is probably a last chance to convert paper wealth into hard assets or at least into paper assets that are backed by hard assets. This is not the time to buy TIPS or government bonds :-) Buy hard assets or assets that are backed by hard assets or watch your wealth burn in the hyperinflationary inferno.

This debate has been going on for years here. Few ever doubted that QE would happen. The doubt was about how effective it would be. That is still case, IMO.

It is not going to be effective in creating jobs or pulling the economy out of a slump. But it will be effective in destroying the value of the paper currency.

As a recent article noted, we are looking at default or inflation on a global scale:

In the world, at the limits to growth
by David Korowicz

Across the political spectrum, people are claiming solutions for a predicament that cannot be solved . . . The only choice is default or inflation on a global scale.

Correct. Either the governments default, banks and the stock market shuts down, and credit disappears for a while or we keep everything open by destroying the value of the paper currency. The latter option is being chosen because it postpones immediate pain and allows the oligarchy to retain their wealth and power.

The question for ordinary people is how they can protect themselves. There are no easy answers but at least buy some gold for crying out loud. Almost everyone can afford at least 1 oz. today. Most people have nothing.

I would suggest food & energy. Of course, everything may be swell for the food & energy producers, at least for a little while, until the angry FWO (Formerly Well Off) soccer moms show up with pitchforks and torches. I just hope that they don't torture the food & energy producers, before shooting us.

It is not easy or quick for most people to become significant food and energy producers. If you have the resources, do both. Produce food & energy and buy some gold. They are mutually exclusive.

wt - And that, as you well know, is why Texans always save the last bullet for themselves. Don't mind dying so much...just don't want it to hurt too much.

But it will be effective in destroying the value of the paper currency.

That is the part that was (and still is) debatable.

Stoneleigh and the other deflationists never doubted that the printing presses would be fired up. Just whether they could make up for all the wealth being destroyed. IOW - does Helicopter Ben have enough helicopters?

So far, I'd have to say it's unclear. The dollar is holding up pretty well, but oil isn't $10 a barrel, either.

The dollar looks like it is holding up because other paper currencies like Euro and Pound have problems too. It has lost a lot of value when measured in terms of hard assets like gold and oil. In just 10 years the US $ has lost 85% of it value when measured in gold and oil.

We all agree that paper printing does not compensate for destroyed wealth. For most people the crux of the matter is how can they protect their wealth? Stoneleigh's answer is to buy government bonds or stay in cash. That is a recipe for disaster.

I don't think it's clear that you're right (nor that she's right).

If there's anything we've learned over the past six years, it's that prediction is very difficult, especially about the future.

Personally, I suspect Nate is right. In the long run, there really won't be any way to protect your wealth.

Gold has gone up 6 fold in 10 years, commodity index is at an all time high and still it is not clear that Stoneleigh is wrong? The only people who preserved their wealth during the last 10 years are those who invested in gold/commodities. Those who stayed in cash have lost a huge amount of purchasing power.

Personally, I suspect Nate is right. In the long run, there really won't be any way to protect your wealth.

Maybe, but in the long run we are all dead. People will and should try to protect their assets for as long as they can.

Gold has gone up 6 fold in 10 years, commodity index is at an all time high and still it is not clear that Stoneleigh is wrong?


I think there's a greater than zero chance that those buying in now would be buying at the top.

Not saying this is the top...just that it's not clear.

Dot-com bubble, real estate bubble...commodity bubble? Wouldn't shock me.

OK, but at least you will agree that Stoneleigh has been wrong so far :-) What was she predicting a few years ago about the price of gold, oil & other commodities?

I think there's a greater than zero chance that those buying in now would be buying at the top.

Isn't that always the case? I would say odds are the bull market in gold will not end until the interest rates are allowed to rise above the rate of inflation. We are not there yet.

OK, but at least you will agree that Stoneleigh has been wrong so far :-)

Just like Malthus has been wrong so far.

Timing is ever the bugaboo. The dot-com bubble went on twice as long as the Cassandras predicted. The housing bubble kept inflating for years after the Housing Bubble Blog and others started warning about it.

And the inflationists have been just as wrong as the deflationists. (Dunno about you, but I'm not using a wheelbarrow to take cash to the grocery store yet).

Inflationists have not been wrong so far. You already need 6 times as many $ to buy an oz of gold or a barrel of oil compared to 10 years ago. This will continue for at least a few more years until the current monetary system falls apart. I am interested in what an ordinary person could do between now and then to protect their assets. Stoneleigh's prescription is cash/government bonds. My prescription is gold, hard assets, paper assets backed by hard assets, high quality dividend paying stocks like JNJ, MRK, PFE, PG, KFT. Why don't we wait till 2015/2016 and see who was right :-) If gold nearly triples in a year I will sell. Maybe that will be the time to buy depressed government bonds or stay in cash. Stoneleigh can then finally claim she was right :-)

The average person doesn't need to buy an ounce of gold or a barrel of oil. Ordinary things like food have been pretty stable.

However, ordinary people do buy refined oil by the gallon, which is now around $3.70, and was $0.99 about 12 years ago...

Gasoline is more expensive, but it's had a surprisingly small effect overall. People are still buying trucks and SUVs, the knock-on effects that many (including me) were expecting haven't really materialized.

And the pattern is spiky - a rise to over $4 followed by a drop to under $2, followed by another rise. That suggests it's not printing money that's behind the volatility, or it would be going straight up.

I'm reminded of a CNBC story from a couple of years ago. It found that printing money did not cause price increases in Japan. Increases in the price of oil did, but not increases in the money supply.

In 2005, I wrote a series of popular web based articles about how silver would begin a great rise following the introduction - and expected wide spread use - of exchange traded precious metal funds. So far silver is more than 7 times higher, but I'm not selling out yet.

If one was worried about confiscation, deflation, etc., they have missed out on the buying opportunity of a lifetime.

Almost one year ago, Stoneleigh, myself, and others here, speculated about the direction of the stock market. Stoneleigh said it was headed much lower, I said it would begin a significant up move that would last for at least three months and possibly continue even after that. Late in 2010, I made an update that the rally may well continue.

I think it is pretty clear now who was right and who was wrong.

As to the future, keep in mind that even under the Roosevelt gold confiscation US citizens were allowed to maintain 5 onces of gold, and that the dollar was linked to gold at that time. Since there is no direct linkage to gold now, a devaluation of the dollar vs. gold has no direct effect on US budget finances, or balancing trade deficits with gold flows. Since the US has enacted a series of laws concering the reporting the buying and selling of gold, it would be much easier to change the tax effect of owning gold than to confiscate it. As a reminder, transactions in certain commodities and commodity linked investments already have a higher tax rate than regular capital gains. If the US bought all the gold, they would lose the tax inflows, and somehow have to come up with billions of $s to pay for it.

So while gold is not a perfect investment for US citizens, it may at least partially maintain your wealth for a while.

"Gold has gone up 6 fold in 10 years, commodity index is at an all time high and still it is not clear that Stoneleigh is wrong? The only people who preserved their wealth during the last 10 years are those who invested in gold/commodities. Those who stayed in cash have lost a huge amount of purchasing power."

Gosh, I bought stocks in 2001-2002 and otherwise held off on more purchases and stayed in cash through 2008 with accumulat(ing) captial earning 5%. Then I cashed out half my 401K in a loan and held out with it until March 2009. All that cash was really useful in the spring of 2009 at the bottom of the market. Not too often you get to make 200-400% profits in one year. Then I converted those profits into commodity trusts in 2010 just as commodity prices came roaring out of the end of the recession. I still don't own any gold. I would conservatively say I've quadrupled my invested money in 10 years with almost zero risk, and my investments gave me income @ 5% all those years as well. Last time I checked, gold bars weren't paying dividends and interest.

Good for you. I never said all the money should be invested in gold.
Last time I checked, gold bars weren't paying dividends and interest.
I agree. But you don't buy gold bars to earn interest. You buy them because it is an asset that has no counter party risk.

Great job of reading the markets.

In retrospect, the 2008/2009 period was more like a 19th century banking 'panic', such as the one in 1892/3 where commodities and other real assets crashed and then sharply rebounded in the next few years.

With the US, and indeed almost the whole world, on a fiat money system, sustained consumer price deflation is almost impossible. Of course, that doesn't preclude periods of falling prices or even occasional crashes, and prices such as for real estate mired in long term down trends.

I talked to Stoneleigh about this. She says she expects owning gold to be made illegal. And you can't buy it anonymously because you must buy from a registered dealer. Silver might be a better bet if you can get some. I understand there are shortages.

My wife and I just received a very substantial inheritance and are wondering what the hell to do with it. We already own our home and property and have a huge garden, greenhouse, fruit trees, garden tools, all the usual stuff. Ultimately there isn't any way to protect your wealth since fiat currencies are all going to become worthless when energy sources are depleted and governments collapse and you can't eat gold or burn it to keep your house warm. Might as well just enjoy our new-found wealth while we can (go out to dinner more, buy new clothes, etc.).

Consider investing part of it in your community. That was the original "bank": the goodwill of your neighbors.

+10, I was about to say exactly that.

That's a good idea. If I thought something would actually do some good I might consider it. I got burned out on community activism about five or six years ago and have been keeping to myself since. I think humans are screwed, overshot, out of luck, out of options. I expect a hard crash and don't see any way out of it. The ironic thing about it is I've set up my life so I don't need much money. I just want to sit back and watch the drama unfold.

"That's a good idea"

It is a very good idea - if you have the right community to invest in. But it sounds like you already recognize the waste of being an "enabler," so to speak, for your locals. The ant needs to find other ants, and needs to avoid the drunk, hungry, and soon-to-be desperate locusts.

Depending on your resources, consider buying land and selling life-time leases to amish families for 10 cents an acre per year.

(p.s. I really doubt you'll want to watch this drama unfold when things get seriously ugly)

It doesn't have to be community activism. It could be as simple as helping one person.

You might not think so, but studies show that this is one of the best uses of money, in terms of enjoyment. Helping others or giving gifts makes people happier than buying things for themselves.

Leanan has a very good point. Consider B. Virdot ("A Secret Gift: How One Man's Kindness") who anonymously helped desperate people living in his city. A small gift can make all the difference between insufferable existence and and tolerable survival -- for both the recipient and the donor.

It doesn't have to be community activism. It could be as simple as helping one person.


I admit I'm hesitant to buy gold even though I have a lot of savings. I guess part of the reason is that in college I did a lot of research on gold mining and the terrible ecological and social costs of gold mining (pollution of water, use of child and slave labor, destruction of indigenous people's land, etc. etc.) I was involved in a campaign promoting alternatives to buying gold class rings.

(some links I quickly found online that explore the costs of gold mining; there may be better links than these...):

If I choose to buy gold with my savings, am I support and encouraging more unnecessary gold mining that is producing waster, polluting water, etc. ? And ultimately, neither investing in the stock market, holding cash, OR having gold can feed you--it all depends on the cultural value applied to these things. There is not some inherent law in nature that gold has value, it is true only in certain cultural settings. To me, the logic telling people to invest in gold still seems to operate by the same general paradigm of investing in the stock market. Wouldn't it be better to invest it in building community, gardens for neighbors, skills building, etc.?

On the other hand, I hear a lot of people in peak oil circles suggesting buying gold, and I'd consider it, if people truly convince me I'm not unnecessarily abandoning my environmental values. Perhaps owning gold would help me in the short-term, but in the long-term the wealth of nature preserved by less gold mining is actually more important to me. I'm open to being convinced otherwise...

Another possibility is stock in hydroelectric utilities abroad. Brazil, New Zealand and Switzerland are available.


Another consideration is that the govt. may limit overseas currency transfers for individuals. The smart money is already moving offshore. There are two megayachts within 100 meters of me. They are building local houses with local labor. These are the people we refer to as super rich. They are as concerned as you are with survival. They worry about keeping what they have somewhat intact. They are not evil people, they were fortunate that their property values exploded and and sold at the high point. They rightfully mistrust investment advisors and are near helpless with investments.

So you and they have a similar problem; excess cash. What to do ?

Diversify. Consider gold = as an insurance policy. Maybe 25% . You can fly to Canada and start an account at TD or other major bank and simply order gold mapleleafs {takes 3 days} which you can put in your safe deposit box. This gets money offshore, becomes a currency play and provides plenty of options if you have to bail out.

Diversify. Invest in the stock market. Maybe 25%. Stick with rock solid companies that will probably pay no dividends, but won't fold like a house of cards. Think POT , Potash Corp of Sask, or PBT, Permian Basin Trust.

Diversify. Transfer money overseas. Maybe 25%. Canada works, but maybe something a little further afield which means a flight overseas. To Switzerland and purchase Nestles stock on their exchange. Or Singapore and buy local CDs from Standard Chartered Bank .

Diversify. Buy local insurance. Depending on your size and preferences, Alan's advice and others above. Small scale;buy adjacent properties to form a moat and lease to a local food coop.

Food for thought. Good luck to all.


You could buy US-produced gold. I used to work in the business in Nevada. We did none of those things.

The biggest US scandals were Summitville and Zortman-Landusky which were run by Canadian companies. As usual, everyone got tarred with the same brush.

While dumping on the Canadians, you can also look up Nesmont Gold, who got caught with a vault full of brass bars, (a classic, but still a good one if you have a green auditor) and Bre-X, which was really ambitious. Especially that last step out of the helicopter.


Most of the Canadians I've met are honest folks, but watch your back around the mining executives.

I don't know about your part of the country, but here in Minnesota we have an organization called the Land Stewardship Project. They train new farmers. I expect that get a few young farmers started in your area would be worthwhile, even if the money never came back to you. Or invest in a local food coop. Or scooter business. Or bike repair. Or build tiny zero carbon houses on trailers. I just saw a presentation where a woman lived in about 150 sq feet, and she ran a sewing business out of the same space powered by PV! A tiny house won't keep its cash value after a crash, but they will be valuable going forward as everyone needs to move to be near jobs / family / etc. Lots of things to put money into that will generate a future cash flow. Totnes has a bunch of good ideas.

A tiny house won't keep its cash value after a crash, but they will be valuable going forward as everyone needs to move to be near jobs / family / etc.

Check this out:


That's an idea: an RV or other portable house. Sounds like SolarDude is invested in his community, with the garden and all, but you never know. You might have to leave, due to unforeseen circumstances, natural disasters, etc. An RV could be used for recreation now, to house family in case of the "brother in the law on the couch version of the apocalypse," or as your main home in case Plan A goes wrong.

The idea of being mobile at first glance seems a good idea. But thinking about it, the main problem seems to be the fact that you're travelling or stopping in somebody else's domain and they'll probably want to produce a rent from such visitors. The ways this can be done are myriad, tolls, fees, licences, premiums on produce, water charges, robbery, etc. The traveller has to carry their wealth and possessions with them which makes them vulnerable.

Travelling would seem to have a high dependency on BAU to work.

Sure, but this is a backup plan. He's already got his home, land, garden. He's talking about spending his money eating at restaurants because he doesn't know what else to do with it.

And I don't think expecting BAU to continue is a bad guess.

I think it will continue, it will just be more difficult...coarser. We'll still have roads, but there will be more potholes in them. The roadside signs will be harder to read. There will be fewer highway rest stops, and they will be less well maintained.

I think BAU will continue too, in a fashion, but the number of people and zones participating in it will keep shrinking. The roads may have more potholes, but they will also cost more to use. BAU will just keep getting more expensive for those within it, until they can no longer maintain the cost and fall into the post-BAU world. I think we just need to look at Greece to see this happening in real-time.

Collapse is already consuming the periphery and is accelerating towards the centre. Insolvent countries are extracting wealth from their citizens to survive, even though the citizens own survival is put at risk. Making governments the biggest immediate threat for ordinary people due to cutting benefits, services or increasing the cost of living and austerity.

Staying put or being mobile will probably be no defence from collapse, we're all going to get hit one way or another.

I have been thinking long the lines of an RV, not so much for its mobility, but for the cost per sq. foot - nothing else as low that I can find. (A 'tiny' home is 2-3 times as expensive.) Lot's of bargains out there and better deals probably coming soon.

A high-end trailer makes even more sense, as the cost of the drive train is stripped out. As long as you have a vehicle to hitch to, you are good to go.

Someone posted this link, awhile back:

Have house, will travel

It's about a guy who built his own RV/portable house.

The reason he built his own is that he found RVs are not built to last. Most people only use them a couple of weeks a year, so they don't need to be all that durable. Even a high-quality RV like an Airstream is only high-quality on the outside; the inside is shoddily constructed.

Here is his web site.

The laws are different in California for with or without drive-train.
Without a drive-train, it is a trailer: not allowed many places. With a drive-train, there is more flexibility.

Some suggestions:
- buy a foreclosed apartment building for cash, and have rental income.
- find acquaintances who are paying usury rates for car loans or such, and carry the note at a reasonable rate. We have an acquaintance in this position - foolishly rolled up an underwater car loan onto a newer car, and both paid too much for the car and has a terrible rate. Poor people don't get the good deals well-off people enjoy.
- invest in efficiency improvements to your house, and then solar

She says she expects owning gold to be made illegal.

Why would the government do that? Roosevelt confiscated gold during the thirties because back then the US $ was backed by gold. Today there is no reason to do so since the US $ is a fiat currency. Future government policies are a complete unknown anyway. They could also nationalize farms to make food available to everyone at a subsidized price in a ration shop.

Some believe that that was actually "helicopter money."

Of course you can't really just drop money from helicopters. That tends to tick people off, if they aren't the lucky ones to get the money.

But forcing people to turn in gold for cash was a way to get money into circulation without it seeming unfair to those who didn't get any.

Yeah if Goldman Sachs get loans at 0.01% interest and I do not I get ticked off. How about you?

One can buy gold anonymously, but expect to pay a premium.

Semi-Numismatic Gold Coins:

Semi-numismatics are coins containing precious metals that generally move up and down with the spot price of the precious metals but also contain additional value above their precious metal content. There is a premium for these coins based upon such factors as demand. Semi-numismatic products currently do not require a SSN upon liquidation. Additionally, these coins are potentially exempt from future confiscation if the government follows the precedent set by President Roosevelt’s 1933 Executive Order. The 1933 Executive Order, which barred private ownership of gold until its rescission in 1974, allowed Americans to continue to own gold coins which had special value to collectors.

I've bought and sold coins such as these without revealing my identity, but never in quantity. One must fly under the radar in times like these.

I learn something new all the time here.

It is impossible to anonymously buy gold in the U.S?

I looked quickly on Google and found this company:


Do you report my gold purchases to the Government or any one else ?

Emphatically NO! Any business you do with us is absolutely private, and we take extraordinary steps to make sure your business with us is private and confidential. Also, we are under no obligation to report your gold purchases to any government agency. Nothing is stronger than our client's trust that the business they do with us will never be revealed to anyone. We would love to publish the testimonies of some of our well-known clients, but their gold ownership is, for obvious reasons, a very private thing.

Do I have to report my gold coin purchases to the Government ?

No, there is no branch of federal, state, or local government that is interested in how much gold you might own. The U.S. Mint, a division of the Treasury Department, strikes the gold Eagle bullion coins, and supports their sale with national advertising, sales brochures, gift boxes, and so on, but in the fifteen years that we've sold their product, they have never asked us to keep track of who is buying it.
See our page: How we are different from other national firms that sell gold coins

but then there is this on the same FAQ on this company's site:

If I sell gold to you, is that reported ?

Certain forms of gold which traded as commodity contracts in 1982 fall under the Broker Reporting Act of 1982. Specifically named are South African Krugerrands, Canadian Maple Leafs, and Mexican gold Onzas in quantities of 25 ounces ( one 'contract') or more. Sales of these items in contract quantities require a 1099B IRS information form, reporting the sale of a regulated commodity contract.

I am confused...

In my view, buy productive land. It has real value and real utility. Unlike gold which has "real" value, but no utility. They also aren't mining more land every year, so it should keep its value better over the long haul.

The dollar is holding up pretty well

That depends on your timeframe....



"IOW - does Helicopter Ben have enough helicopters?"

He only needs three. One for Goldman-Sachs, one for Citigroup, one for JP Morgan-Chase. Everyone else can crash & burn as far as he is concerned.

"Argentina defaulted in 2002, froze the banks, declared its foreign debts void, and cut itself off from IMF funding – and since then, it's been the fastest-growing economy in fast-growing South America."

An interesting contrast

He only needs three.

Aren't those big three located with a few blocka of each other. One Helicopter can drop three bundles!

I don't know - those are pretty big bundles! He'd need one of those "Jolly Green Giant" heavy lift helicopters...

those are pretty big bundles

Not if he's smart enough to use large denomination bills. No ones, fives, tens, or twenties allowed on board!

An interesting piece of truth in your statement.

Back when Dr. Bernanke was still an academic and made the helicopter statements, he was talking about delivering money directly to the consumers: eg, put $1,000 into everyone's checking account. Now that he's head of the Federal Reserve, the laws don't allow him to do that. He can effectively put almost unlimited money into each bank's account at the Federal Reserve, but has no way to give money to consumers. The "tool" that he claimed was adequate to stop any deflationary spiral is a Congressional tool, not a Federal Reserve one.

I posted late in a prior drumbeat about the EROEI of hemp in biofuel. I came across this paper, aside from a lot of blind endorsement without figures, but such is the standard it seems. IIRC, hemp still requires a DEA permit to grow in the U.S. I thought I would share what I found.

PDF Warning: Biogas production from hemp – evaluation of the effect of harvest time on methane yield

There's a great comparison chart (maybe someone has a better one?) towards the end.

They don't vanish. They are just moved off the front page, so they don't swamp the site.

Older Drumbeats can be found at the Drumbeat link, up top.

Thank you. Sorry I saw the link at the top after I posted. I thought I edited before anyone saw.

I'm going to guess that palm oil blows all those out of the water as a source of fuel, and of course I know it doesn't grow in the US.

The utility of hemp is grossly overplayed.

"The utility of hemp is grossly overplayed."

Right....Ever smoke palm oil?

Most folks distinguish hemp from marijuana. Ever wear hemp underwear that wasn't first chemically converted to viscose and/or blended with cotton? Ever try to eat the leaves as a regular vegetable course?

Can't be done with hemp, but it's routinely done with jute.

"Most folks distinguish hemp from marijuana."

The DEA doesn't.

October 9, 2001
The Drug Enforcement Administration (DEA) today announced rules to clarify the legal status of “hemp” products. “Hemp” is part of the cannabis plant, which is also known as marijuana. The rules published in today’s edition of the Federal Register explain the circumstances under which “hemp” products are subject to control under federal law.

“Hemp” and marijuana are actually separate parts of the species of plant known as cannabis. Under federal law, Congress defined marijuana to focus on those parts of the cannabis plant that are the source of tetrahydrocannabinols (THC). THC is the hallucinogenic substance in marijuana that causes the psychoactive effect or “high.” The marijuana portions of the cannabis plant include the flowering tops (buds), the leaves, and the resin of the cannabis plant. The remainder of the plant — stalks and sterilized seeds — is what some people refer to as “hemp.” However, “hemp” is not a term that is found in federal law.

DEA Administrator Asa Hutchinson stated that “many Americans do not know that hemp and marijuana are both parts of the same plant and that hemp cannot be produced without producing marijuana.”

Never mind that hemp has many other uses. Rope, soap, dope; it's all the same to the Feds if you want to produce it in the US.

"hemp and marijuana are both parts of the same plant and that hemp cannot be produced without producing marijuana"

He is full of it. It is the same plant but it comes in many varieties. The ones grown for dope produce a high amount of THC (tetrahydrocanabinol) and relatively little fibre. However if you would try to get high on the windbreak variety you would need to roll a 100 meter joint. These produce lots of fibre, but hardly any THC. The seeds of this variety are common in birdfood.

That's why the windbreak variety is legal in Holland and the other is not ( contrary to popular belief marihuana is not legal in Holland). You can't even grow the 2 together as it would ruin your dope.

You can grow hemp without producing marihuana.

I guess the DEA has to protect some vested interests.

Who's full of it? Seems like your comment supports mine.

These bizarre pillow fights over raising the debt ceiling seems to be cycling into smaller and smaller time increments.
Is this related to the danger of hyper-inflation and what will it take for hyper-inflation to be triggered: is it mainly that the population ceases to "believe" in the stability of the currency?
Is it purely a herd instinct to "run away" or something more technical vis a vis the currency in question versus other currencies?
In other words, what is the last straw that breaks the camel's back?


I don't think anyone is seriously worried about hyperinflation or currency stability.

This is something a certain segment of the GOP has been wanted to do for decades. Since at least Newt Gingrich's heyday, and probably since the Reagan years. It's made it very difficult for the Republicans to climb down, even though they know they'd lose if the government shuts down (since it's happened before, to their detriment). But government spending is a lightning rod to the small-government fiscal conservatives. At this point, it's probably easier to vote for gay marriage than to give in on this issue.

I am not sure there is a good option here. The US is already borrowing about 1/3 of the budget. This is like applying for new credit cards to make the payments on the past cards, pay expenses, and buy new stuff. As long as you get a new credit card every month, the hard discussions on what is really a priority are never had.

This month we're arguing about applying for another card. Maybe we'll get approved...but we all know the situation is getting out of hand. If we get one, how do we keep from maxing it out immediately?

We could get a second job (raise taxes), but that makes life harder - Dad doesn't want that, because he'll do the work and miss the baseball games. We could cut Mom's budget, but people like to eat, the kids want their allowance and birthday presents, nobody wants the HVAC set to 90F, and besides, vacation is this month. We could not pay the bills, but it's kinda nice to have a house and muscle car, and if we don't pay the card bills then next month there will be no choice at all.

Still, we know that if we don't balance our budget the situation gets worse each month. Dad keeps expecting a raise and then a promotion, and has for 5 years now, but instead his salary was cut 10% a couple of years ago, the company isn't growing, and nobody is quitting. In fact, senior managers are looking to move down a rank if a downsize comes through.

In our family, perhaps you'd send Mom back to work until the bills are paid off, cut the kids' allowance, buy a beater economy car, and think about downsizing the house. Vacation would become a staycation instead, and Junior would start mowing lawns for a few extra bucks. Dad would sell his baseball cards collection, sell the Mustang, and have a garage sale to bring in some bucks, and plan to repair the replacement cars himself to save some cash.

Maybe another month of credit would make sense if it sets Mom up in a work-at-home vocation instead of an office job, or if it buys Junior a lawnmower.

Instead, what we have is Dad and Mom fighting, and heading for divorce and bankruptcy. Both want a balanced budget, but Dad insists that Mom cut her spending first or go get a job, and Mom insists that Dad go in and demand a raise and sell that car first.

Of course, mom, dad, and the kids all believe that mom and dad are gonna get big raises soon, and be able to pay off the credit cards. Or at least keep the payments manageable.

If they ever came to believe that that wasn't going to happen, then the battles would really begin.

A key enabler, perhaps intentional since the outset, is that the cap is a ceiling amount, rather than a rate cap. If the gov't could only spend, say, 20% more than it took in over any rolling 2 year period, the feedback would be more effective. As it is, the tendency is to run full-tilt into the wall, rather than slowing, curving and bumping along it.

A good first step in any deal is to establish that no month can spend more than 99% of the previous six month average, or 10%, whichever is greater. Then at least it will get better over time.

Using household analogies to illuminate top-level economics is not recommended. (It is, however, excellent for propaganda purposes.) The system is not fractal. These two extremes do not have the same underlying structure. This is not a view at two different fractal scales.

They are making a great show of it. Not one word of where this level of debt was generated: the newly unregulated banking and financial casino establishments. The military economy just received another raise to cover the beginnings of newly opened war fronts. No one mentions that social security is, or was, a self-sufficient trust fund "of the ants" that was raided "by the locusts" long ago.

The frightened people will capitulate? The "Patriot Act" is good precedence.

Aide: Obama "abruptly" exits tense budget talks:

Little Susy Newsykins:

Watch this


[abridged conversation]
Ron Paul : Do you think Gold is money ?
Ben Bernanke : No
Ron Paul : Even if it's been money for six thousand years, someone has reversed that economic law ?
Ben Bernanke : Well it's an asset, would you say Treasury Bills are money
Ron Paul : Then why do Central Banks hold Gold ?
Ben Bernanke : Because it's a form of reserve.
Ron Paul : Why not Diamonds.
Ben Bernanke : Erm...Because it's tradition.

Priceless !!

Wow! You couldn't make that up.

Gold isn't money. You can't loan or print it into existence.

Gold at $1581....Got gold?

All commodities up nicely:

Crude Oil 98.08 + 0.67%
Natural Gas 4.40 + 1.52%
Gasoline 3.15 + 1.79%
Heating Oil 3.10 + 0.42%
Gold 1580.93 + 0.88%
Silver 38.07 + 5.34%
Copper 4.39 + 0.23%

Diamonds can be manufactured. The price is maintained because of the actions of a cartel (De Beers) and if central banks put their reserves into those, they'd be handing De Beers control of their currency value.

The only gold you can manufacture comes with a radioactivity tag. The amount coming out of the ground is much more understandable.

However, you couldn't exactly say that in public, if you were Bernanke.

"Diamonds can be manufactured."
Diamonds are not rare.
Yes, the cartel maintains the price.
The price maintains the bloodshed.
Just like the war on drugs.

Iowa got their crop in on-time unlike the eastern part of the Corn Belt. After looking at the historical temperatures over the winter, I was wondering if last year signaled an unfortunate turning point and it appears I may have guessed it right. With the last serious heatwave in 1988, yield was 30% lower than projected.

Ag markets: Corn prices jump on worries over heat

Corn in Iowa and elsewhere has begun to tassel and will pollinate during the same period of expected high temperatures. Agronomists say that corn pollinates best when the temperatures are in lthe upper 80s. Temperatures consistently in the mid-90s, with little letup, historically have tended to reduce yields.

World and U.S. corn markets are counting on a bumper crop this year to ease the stress of a 15-year low in corn surpluses, which has caused prices to double since June, 2010.
Iowa has generally avoided the tradtional scorcher summers since the late 1980s. The last serious drought, defined as temperatures the mid 90s and above with no rain, happened in 1988.

“We had hot days, like last year, but they came and went quickly,” said Hillaker.

USDA Sees More Corn To China

The U.S. Department of Agriculture raised its estimates for corn exports to China fourfold, another nod to the country's rising demand in a market under strain. In addition, the amount of the grain used to make ethanol is expected to eclipse its use in animal feed in the U.S. for the first time ever.

China is now forecast to import 2 million metric tons of U.S. corn in the next marketing year, which begins on Sept. 1, compared to the previous projection of 500,000 tons.

This is good news, surely.

At $8.58/Bu., 2 megatonnes is about $675M. Iowa is doing its part to reduce the trade deficit with China. ;-)

And personally I'd prefer to see the corn go to feed pigs, which have a good feed conversion ratio (for mammals), rather than going to feed cows or to make ethanol.

The weather map sure looks bad for fertilization, though:

Another way to look at it is that are shipping our soil, such as it is, to China. Although, I guess soil quit mattering a long time ago if you can just dump fertilizers on a substrate sort of resembling soil.

It has been quite hot and humid around here(Quad Cities). Everyone's grass is dead and I'm sure the corn won't be able to hold out much longer unless we get some good rain. I think we've seen barely half an inch of rain all month.

I posted the link in a previous Drumbeat, but didn't cite any numbers. Here is an excerpt of the numbers

June 2011 Hybrid Car Sales Numbers
Model    Units  	vs. last month  	vs. June 2010  	CYTD  	vs. CYTD 2010
All hybrids  	12,714  	-27.0%  	-41.4%  	133,114  	1.7%
All vehicles 	1,053,405 	-0.4% 	          7.1%  	6,333,313 	12.8%

June 2011 Plug-in Electric Car Sales Numbers
All plug-in cars  	2,269  	39.1%  	n/a  	6,707  	n/a
All vehicles    	1,053,405 	-0.4% 	7.1% 	6,333,313 	12.8%

June 2011 Clean Diesel Car Sales Numbers
All clean diesels  	8,653  	-7.1%  	25.7%  	48,025  	37.6%
All vehicles 	1,053,405 	-0.4% 	7.1% 	6,333,313 	12.8%


Of the diesels, the VW is the only middle-class car on the list. It is clear that the luxury segment is doing better than the middle class segment.

As for hybrids, the numbers are so skewed by battery availability for the Prius that it's otherwise mostly meaningless.

What is clearly missing is a clean-diesel 1500 series truck. Such would readily outsell the hybrid trucks.

A solution to the wind turbine placement paradox?

Wind-turbine placement produces tenfold power increase, researchers say

PASADENA, Calif.—The power output of wind farms can be increased by an order of magnitude—at least tenfold—simply by optimizing the placement of turbines on a given plot of land, say researchers at the California Institute of Technology (Caltech) who have been conducting a unique field study at an experimental two-acre wind farm in northern Los Angeles County.

also http://dabiri.caltech.edu/research/wind-energy.html

Perhaps true in complex, hilly terrain. But certainly not on plains.


Appearently wake turbulence is also a problem on the plains. Wake turbulence can extend nearly a mile behind large d=300' turbines. This is why optimum spacing for large turbines may exceed 1 km. This waste a lot of real estate.

Many of the older wind farms did not take this into consideration, placing pylons too close together.


Wind shadows are well known. Just line them up in the non-prevailing (least prevailing optimally) wind direction.

Some additional power if they are spread out very widely, but that is uneconomic.

However an order of magnitude gain in generation ? NO WAY !!


Well, if you read the article, it becomes apparent how they can make this claim, but it also becomes apparent that this claim, in and of itself, is not really useful.

This whole study was about using closely spaced vertical axis wind turbines. They found an optimum spacing of 4 diameters (20 for HAWt's).
They say that their wind farm produced 10 times more power, per sq.ft than a "comparably sized" HAWT wind farm, without actually saying what that comparably sized farm is. I suspect that meant small turbines (10ft diameter) on low towers(<30ft).

So yes, if you are going to set up a very inefficient HAWT farm, and then set up an optimised VAWT farm, you could achieve that.
But, the missing information is what is the cost of doing so? - is it even close to being economically better than conventional wind farms, and I'd suggest the answer is no.

It is a bit like saying how using the highest efficiency solar cells and tracking systems, will get more power /sq.ft than a static rooftop system. This is true, but if the extra power does not cover the extra costs, so what are you achieving?

We really do not have a shortage of land area for wind - not even close. We do have a shortage of investment in wind, and this study, and misleading reporting like this, is not going to help change that.


Pardon if this has already been posted.

Is the a new "Lehman Moment"?

It is looking more and more like 2008 all over again.

The president “got very agitated” and said, “Don’t call my bluff; I am going to the American people,” said Cantor, a Virginia Republican. Obama “shoved back from the table” and left, Cantor said.


Moody's to review US triple-A debt rating


Ratings agency Moody's has said it may cut the US AAA debt rating, citing the "rising possibility" the US will default on its debt obligations.

The agency warned the likelihood the US would fail to raise its statutory debt limit in time to avert default was "low" but not "de minimis".

It came as a fourth day of cross-party talks in Washington on the debt limit were said to have ended stormily.

President Barack Obama reportedly told a top Republican: "Enough is enough."

A white knuckled Chairman Ben seen contemplating the abyss



Treasuries and the dollar weakened while U.S. debt insurance costs climbed to the highest level in more than a year after Moody’s Investors Service said America may lose its Aaa rating. European stocks and Italian bonds declined as gold rose to a record for a second day.

The 10-year Treasury yield added two basis points to 2.90 percent at 7:15 a.m. in New York, and the Dollar Index retreated 0.2 percent. Credit-default swaps on U.S. debt jumped 7.5 basis points to 58, the highest since February 2010, according to CMA. Italy’s 10-year yield rose 17 basis points after a debt sale. The Stoxx Europe 600 Index lost 0.9 percent. Futures on the Standard & Poor’s 500 Index added 0.2 percent after JPMorgan Chase & Co. reported earnings. Gold advanced to an all-time high of $1,594.45 an ounce.


A white knuckled Chairman Ben seen contemplating the abyss

Why would he be worried about the abyss... unless his helicopter is starting to sputter as it runs out of fuel.

US Will Keep Paying Bondholders After Aug. 2: Bernanke

Bernanke confirmed for the first time that the Obama administration is making contingency plans in case the debt talks fail to produce a deal. He said its top priority was to ensure that holders of U.S. bonds were paid on time. However, prioritizing the debt would mean ordinary Americans would suffer.

"As a matter of arithmetic, fairly soon after that date there would have to be significant cuts in Social Security, Medicare, military pay or some combination of those in order to avoid borrowing more money," Bernanke said, focusing on areas that could affect key voting blocs ahead of 2012 elections.

"If, in fact, we ended up defaulting up the debt—or even if we didn't ... it's possible that simply defaulting on our obligations to our citizens might be enough to create a downgrade in credit ratings and higher interest rates for us, which would be counterproductive of course because that makes the deficit worse," he said.

The funniest thing about the whole mess so far (at least to an old IT guy) is getting relatively little coverage: it's not clear that the federal government can keep their computers from making a lot of those payments. Short of pulling the plugs, at least, which will potentially produce a large number of problems down the road when they power back up.

I got to see some of the shortcomings of state government software up close while I worked for the Colorado legislature. Based on that, it's easy for me to imagine that the SS software has no way to delay making direct deposits for an indefinite period.

Side note: I've also seen private sector software systems with similar holes in their capabilities. Government doesn't have a monopoly on bad software, but private companies don't usually have to air their dirty laundry in public.

As of December 2010, the Social Security Trust Fund holds $2.6 trillion in special issue treasury bills that can be redeemed at any time at face value. If the U.S. Treasury prioritizes bond payments, then Social Security is solvent for several years even if all payments from workers stop. Bernanke is fear mongering about Social Security cuts.

"Why do some people describe the "special issue" securities held by the trust funds as worthless IOUs?"

"the trust funds are backed by the full faith and credit of the U. S. Government"

"The government has always repaid Social Security"

Past performance does not something something mumble

George Carlin - at time mark 1:40

How fast could Congress dissolve the Federal Reserve if helicopter Ben did not print dollars to pay the Social Security special issue securities?

The article, UK Banks Abandon Eurozone over Greek Default Fears, in the UK Telegraph is dated "9:30PM BST 18 Jun 2011," about a month old.

Two new reports from Oak Ridge National Laboratory

Making Industry Part of the Climate Solution: Policy Options to Promote Energy Efficiency (pdf)

... Numerous studies have shown the potential for significant cost-effective energy-savings in U.S. industries, but the realization of this potential is hindered by regulatory, information, workforce, and financial obstacles. This report evaluates seven federal policy options aimed at improving the energy efficiency of industry, grounded in an understanding of industrial decision-making and the barriers to efficiency improvements.

Detailed analysis employs the Georgia Institute of Technology‟s version of the National Energy Modeling System and spreadsheet calculations, generating a series of benefit/cost metrics spanning private and public costs and energy bill savings, as well as air pollution benefits and the social cost of carbon. ...The social benefit-cost ratios of these policies appear to be highly favorable based on a range of plausible assumptions.

Making Homes Part of the Climate Solution: Policy Options to Promote Energy Efficiency (pdf)

In the area of energy efficiency, advanced technologies combined with best practices appear to afford not only large, but also cost-effective options to conserve energy and reduce greenhouse gas emissions (McKinsey & Company, 2007). In practice, however, the realization of this potential has often proven difficult. Progress appears to require large numbers of individuals to act knowledgeably, and each individual must often act with enabling assistance from others. Even when consumer education is effective and social norms are supportive, the actions of individuals and businesses can be impeded by a broad range of barriers, many of which are non-technical in nature.

Japan to shoot lasers from the moon to solve power crisis

This idea has been around since the 80s. See the Space Manufacturing Conference proceedings of the Space Studies Institute.

Illinois governor signs bill to approve contruction of first coal-to-gas plant.

'The $3 billion plant is set to be built on a former industrial site on the city's southeast side. The so-called "coal gasification" plant will turn Illinois coal and refinery waste into a natural gas substitute, without having to burn the coal.'


In an interview, a proponent (whose name I didn't catch) mentioned "we have two hundred years of coal". I'm not sure whose coal he is referring to, exactly.

Don't burn the gas as well and we have a winner. Considering the span of human history, even if it is true that we have two hundred years, that is much solace for those who are around 200 hundred years from now.

Right now, any proposal with "jobs" attached to it seems to be automatically a winner. They are saying it will bring 1,000 jobs to a south side devastated by loss of other industry, particularly steel.


Additionally, they are claiming to be recovering a brownfield, polluted site. It is expected to be a three-year project. There are, of course, pollution concerns raised, but the biggest issue, and the reason the proposal was originally vetoed, was potential cost to consumers.

Always short-term considerations, putting pressure on politicians.

Other people say with the US "awash" in natural gas, they don't see the economic viability of synthesizing it. This debate has so many moving parts.

Edit : In 2009, Energy Bulletin posted an article by Byron King on coal availability in the US. He mentions that Illinois coal is bituminous with high sulphur content, and cannot be burned under the clean air act without special scrubbing equipment.


Wind project powerful idea
Windfield propeller is province’s first community-owned turbine

SPIDELL HILL — When David Swan swept his gaze across the Cobequid Mountains on Monday, he didn’t see the curl and crush of continents that formed the northern Appalachians.

He didn’t see pulpwood waiting for the blade.

He saw electricity.


Behind Swan stands Nova Scotia’s first community-owned turbine. Its propeller blades were installed Saturday and the turbine is expected to start supplying electricity to Earltown and Tatamagouche by month’s end.

The turbine, which Swan predicts will generate enough electricity to power 300 homes annually, is owned by the 180 joint stockholders in Colchester-Cumberland Windfield.

"We’re owned by farmers and fishermen, nurses and bank workers," said Swan. "Usually when people invest, they rush to the bank to deposit their money in an RRSP and that money goes off to the Toronto Stock Exchange. But when this little community invested in us, the funds are used right here."


"This little community has come out big time to support this project," said Swan. "It’s also proof that the green economy isn’t just an idea, it’s happening."

See: http://thechronicleherald.ca/NovaScotia/1253080.html

With luck, we'll see more community-based wind initiatives like this.


About 30% of Danish wind turbines are owned by groups of people. Often one farmer (his share for providing the land) and the rest city and town dwellers.

Best Hopes for More !


My wife and I had discussed this very notion. It's not much different than a water co-op, except that the step-in cost is millions of dollars.

Perhaps somebody like Google could get behind this, to help with financing?

Good stuff.

This sort of thing should be replicated - sounds like the sort of thing the Atlantic Canada Opportunities Agency should be facilitating, but I have no idea how successful they are in their efforts.

I would think the best thing that can happen is some standardised structure and permitting procedure for things like this. Big corporations can handle the expense of long processes, but community based groups can't.

The gov should be pushing this for all its worth - will be a sure vote getter. The only people that won;t like it will be the New Page's, and no one will lose sleep over that.

Paul, I just recently reviewed and stamped two proposals for community wind turbines in eastern Washington State. The hard work of putting the projects together and seeing them through construction and commissioning is the work of Terry Meyer at Cascade Community Wind.

Look up Peace Energy Co-op. They initiated the 150 MW Bear Mountain project near Dawson Creek.


I have the copy of Don Pettit's "Power Shift" on my office bookshelf. Been in meetings with them for more hydro electric and wind.

I've been promoting renewable energy co-ops for smaller scale projects. Ontario has been at it for awhile (we copied - guilty), and there are tax investment perks for Canadians. They can invest in the REC's as part of their RRSP - that's 401(k) for those 'mericans.

Now THAT is publicly owned power...

Hi BC_EE, good example, I think they are working on another or expanded project aren't they?

Where have you been hiding out, haven't seen you posting for the longest time. Have tried to get in touch but emails bounce from you address - can you send me one please (email in profile)

Might have a project at my favourite Kamloops ski resort...



With luck, we'll see more community-based wind initiatives like this.

For places with a lot of sun, I hope to see community-based PV installations as well.

A possible 'easy one' would be for housing associations to put in 'shade' for their cars as grid-tied PV-roofed carports ;)

Can the eurozone survive the Greek debt crisis?
If Greece defaults on its debts, the consequences could spread across Europe, and prove catastrophic for the euro

That'll leave a mark!

Afghan president's brother, Ahmad Wali Karzai, killed:

Chief Duffy makes drug arrest on crime watch bike ride:


Just a matter of having the right connections.

ConocoPhillips Plans to Split in Two, Following Marathon Oil

July 14 (Bloomberg) -- ConocoPhillips said it would spin off its refining and marketing arm into a new business, following Marathon Oil Corp. in splitting itself up to increase returns for investors.

The company will split into two stand-alone, publicly traded operations. The division is expected to be completed in the first half of 2012, the Houston-based company said in a statement today.

ConocoPhillips rose 3.5 percent in premarket trading in New York.

Recomplexifying or decomplexifying??

Maybe splitting the company into parts because one of the resulting companies is expected to go bust. As in, the one holding the mythical reserves, which are likely to decline and cause that stock to plunge. The refining company may still be viable, if oil can be imported from some where else...

E. Swanson

I am guessing just the opposite, they are spinning off the refining because it is not profitable and there is more capacity coming on line (see article in this DB and carnot's guest post).

Maybe refiners are going to be going bankrupt just like the corporations that ship oil.

For a short period, Midwest refineries (and COP owns some) are minting gold. Buy oil at WTI prices and sell product at Brent prices.

The Midwest is not self sufficient in refining capacity, so the marginal comes from Gulf refineries. And marginal supplies set the market price.

Now is a good time to shed the refineries. If I were a COP executive, I would try mightily to get onboard the production spin-off company.


Alan - I'm far from a refinery expext but I would agree with you. Despite what some folks think refiner profit margins have typical run contrary to oil prices. High oil = lower margins for refineries. Folks tend to forget the biggest buyers on the planet are the refiners. And ExxonMobil doesn't sell it's oil to ExxonMobil refiners at a discount. In fact, because of tax laws, they'll sometimes sell it at a premium. As you point out the mid-west refiners are in a very lucky spot. But it won't last forever...nothing does.

Despite what some folks think refiner profit margins have typical run contrary to oil prices.

That only makes basic economic sense. When oil prices are high, the demand for refining should follow the demand for finished product down (and vice versa). So one would expect refiners to take it on the chin when gas prices force demand downwards.

EOS - Exactly...it's a volume business. I barely recall being told once that when oil prices are low refiners are making something on the order of $0.15+/gallon. With high oil prices it drops to less than $0.05/gallon along with reduced sales volumes.

‘China worried about US economy’

China is watching whether the Federal Reserve launches a new stimulus that might hurt China by pushing up commodity prices, a Cabinet researcher said Thursday.

The US economy “has been doing worse than expected” and Beijing needs to “seriously assess” possible risks to its vast holdings of American debt, said Yu Bin, an economist in the Cabinet's Development Research Center.

“The prospects of the US economy are worrying,” Yu said at a government-organized briefing. Beijing uses such briefings to explain official views, though the researchers do not act as government spokespeople....

...We are following closely whether the United States will introduce QE3, because we believe it will have a major impact on China's economy,” said Yu, director-general of the Development Research Center's Department of Macroeconomic Research.

“The drastic rise in commodity prices caused by the devaluation of the US dollar will have a major impact on inflation, on economic growth and on Chinese people's daily lives.”

Yu warned that such a move also would affect the “long-term trajectory of the US economy.”

“Therefore, I believe the United States should be careful,” he said.

China held some $1.15 trillion in US Treasury debt as of the end of April, according to the latest US government data.....

Either way, a devalued dollar, or rising commodity prices, I think the Chinese realize that Americans won't be able to afford their stuff much longer. It's been a nice run (for them). Will the Yuan become the default trading currency?

Either way, a devalued dollar, or rising commodity prices, I think the Chinese realize that Americans won't be able to afford their stuff much longer.

True, however if you read between the lines it comes across more as a warning about what they (China) may do with all that US debt they are holding, 'IF' the US opts for QEIII (which will have the effect of raising commodity prices and further causing inflation for China's citizens).

It's starting to look more and more like this higher energy priced world along the peak plateau, will be pitting US and China's interests against each other. That's a bad road to be going down. Two rams at the peak of a diminishing mountain top.

And don't forget the still possible failure to raise the debt ceiling.

A veritable minefield of possible fiscal calamities. Bernanke was being questioned at a hearing yesterday and he sounded quite nervous. Who wouldn't be in his position. He tries to put on a happy face, but that quivering voice offers up a different reality.

What could they do with all the U.S. debt they are holding? If they tried to dump it wouldn't it's value drop even more? And that's assuming they could find a buyer for it, who would that possibly be?

If they tried to dump it wouldn't it's value drop even more? And that's assuming they could find a buyer for it, who would that possibly be?

I cannot imagine what China would do if big sum of money they lent out went sour. They'd probably demand California.

A few years back, someone who had lived in China and studied Chinese politics posted about what China means with these warnings.

His interpretation was that China sees dumping their bonds as a "nuclear option." They are willing to do it, and they understand it would hurt them as much as us; it is strictly a last resort.

They understand that they will probably end up taking a haircut on their investment. What they want is for the pain to be shared equally.

Nuclear option indeed.
I realise this pie chart is a little dated, (I assume the percentages remain approximately the same) it really would have a huge domino effect on so many other countries.

It's interesting though, that China holds less U.S. debt than is generally assumed at slightly <10%.

Bit like a Jenga tower and China's one of the bottom blocks.

Hang on, let's assume that the US went QEIII and in response China dropped it's US debt on the market. Others would more or less be forced to do the same, collapsing the US currency.

Say the exchange rate of US Dollars:World Currencies tripled overnight. At this point the oil price (in dollars) would also triple, and with it US pump prices. You are no longer looking at $3.50 a gallon, but $10+. Business and individuals wouldn't be setup to manage that scale of change - there would be defaults, etc. pulling down most companies and many individuals.

As far as others are concerned, nothing has changed in commodity pricing in their currencies; but the US has been priced right out of the market. The 13 Mbpd in US demand has been destroyed, and so the price of oil falls way down. It falls so far that bits of the US can again afford to buy, but at a reduced volume. Say it reaches $30 a barrel.

China has lost a big market, and taken a haircut on its debt holdings, but has gained the scope to grow it's resource usage and particularly energy usage. Europe has similarly lost and gained. Really, its the US that has suffered - others could pick up the pieces and deal with a diminished US market (which has always been protectionist, so limiting it's importance). China could lose 26% of its market and survive, using centralised C&C decision making. Europe similarly.

From a global strategic perspective, it would provide everyone else with the resource breathing space needed for transition, building on the carbon policies they have been doing for decades. Maybe it would be a sacrifice worth taking, if you take a long view?

No, that can't be right. We've been told that with a fiat currency there's no limit to the amount than can be created. Bernanke can just print away as much as is needed to fix everything. Somebody better tell the Chinese.

Will the Yuan become the default trading currency?

Not unless the Chinese government is willing to meet all the other conditions that such a currency would require in today's world. There needs to be lots of very safe, highly liquid, yuan denominated financial assets in global circulation. There needs to be active markets largely outside the government's control where those assets can be traded at low costs and in large volume. The government has to be willing to give up essentially all control over exchange rates.

I have trouble envisioning the Communist Party going along with any of those.

The housing slump is far worse than you think

Ramsey says every housing statistic he tracks, including new and existing home prices and the performance of homebuilding stocks, has so far matched the pattern of prices after the bursting of other bubbles, including the Dow Jones industrial average following the crash of 1929 and Japan’s Nikkei after its 1989 peak. It starts with a steep decline lasting three or four years, followed by a brief rally that ends in years of stagnation. The Dow took 35 years to return to pre-crash levels. The Nikkei trades at less than a third of where it peaked 22 years ago. “The housing decline,” he says, “will be a long, multiyear process, and the multiplier effect across the economy will be enormous.”

Others are equally gloomy. “It’s still a vicious cycle of foreclosures, prices falling and buyers remaining on the sidelines,” says Jonathan Smoke, head of research for Hanley Wood, a housing data company. With the homeownership rate possibly headed to its pre-bubble level of 64 percent from 69 percent at the peak, Smoke calculates that the nation needs 1.6 million fewer homes that it now has. “We’ve gone through a period when we should have been tearing down houses,” he says. “The supply of total housing stock is beyond what is necessary.”

If this is correct, it will be Japan 2.0. Not very dramatic, and not much fun, either.

Optimists are predicting a rebound from the bottom, pessimists fear the bottom could fall out in the next stair-step down. But it's looking like Japan is the model to look for. The bottom won't fall out again, but there won't be a rebound, either. Just bouncing along at the new low, possibly for decades.

I'm a little skeptical it'll turn out as well as Japan.
The single family dwelling overstock, I think is underestimated. My thinking is that we're on the cusp of a major reversal of single family housing to multi-family/rental unit type housing. I'm seeing even people who can afford to buy their own home choosing not to; renting instead in multiple unit type townhouse/condo type housing. There are very serious financial downsides to owning a single family dwelling in a deflationary environment and the well off can get hurt in this kind of situation very badly, too; not just the less well off.

Another factor, when Natural Gas prices double (as they must eventually). SFRs without shared walls, and McMansions with maximized surface area, will usually have higher utility costs. Add higher commuting costs, a stressed economy and smaller households and the demand for many SFRs will diminish.

Still some room to drop, though. Many who need to sell have been holding out for a recovery, and usually that bottom doesn't hit until most of those capitulate. I'd say only the slow foreclosure process has kept that from happening already, but that slowness has created another problem. Heard on the radio yesterday that mold is a rampant problem, since many houses have sat empty without utilities for a year or more. Such houses will further depress prices, as they go unsold or are hastily repaired and sold at bottom-basement prices.

Just bouncing along at the new low, possibly for decades.

Except for the painfully obvious fact, much discussed here at TOD over the last few years (in case you hadn't noticed), that we do not have decades of fossil fueled energy production available to maintain even current standards of living. Never mind the demands of an economy designed from the ground up to implode if the promises of future physical wealth are not seen to be constantly growing to infinity and beyond. Now multiply that by the demands of two or three billion more colossal humans scheduled to arrive in the near future on this already badly overburdened little spaceship.

These facts would seem to suggest that the only "bouncing" to be observed in the decades to come will be entire economies shattering into dust as their now redundant populations slide right off the face of the Earth. Horn of Africa, anyone?

Besides, aren't you the one constantly harping about how pointless and wrong everyone's predictions are? Seems a bit disingenuous of you to now start throwing around views on the future that, in my opinion, have a better than 100% chance of also being wrong.


How am I being disingenuous? What am I lying about?

And a better than 100% chance? That's not even possible.

I freely admit I could be wrong, and I always have. Heck, I don't really have a position. I've always said everything from BAU continuing as long as anyone here has to worry about it to Mad Max next year is possible.

But if events of the past few years are any indication...the more catastrophic versions of events seem increasingly unlikely to me. Not impossible, but less likely. It appears our complex society is not as fragile as some feared.

Six years ago, if someone had told us that oil would hit $150 a barrel, we'd probably think it was TEOWAWKI. Dieoff, collapse, living in caves scavenging for mushrooms.

But here we are, with most people more concerned about the NFL contract negotiations and Will and Kate's clothes than about oil.

In any case, I do not think predictions are pointless, and certainly don't want to discourage people from posting them. But as I've said before...a little humility is in order. Maybe your opinion (whatever it is) is wrong. And if others disagree with you, it doesn't mean they're stupid or in denial or in the pocket of Big Oil. This is something about which reasonable people may disagree.

The scary part is not so much endless recession as a phase transition. Japan is no longer bouncing along in a decades-long recession. Due to an earthquake triggering a cascading failure event, they have entered new territory. Endless recession and various ill-considered and expensive responses to it deplete our capacity to respond when something big breaks.

I strongly expect that the earthquake will simply knock them down a rung, and they'll bump along there. There will be a new gaping sore -- the irradiated area and doomed power plants -- and a new set of goals and sacrifices, but unless that new path happens to create new, cheap energy or other resources it's hard to see how they will climb back up to where they were.

It's not a massive thing, but a good bit of their nation's capital -- accumulated wealth -- was destroyed, and a fair bit of the abilit to create new wealth was damaged as well.

As I've said before, complex systems at the edge of their tolerance zone are fragile, and when kicked from outside they break. But each is itself a set of complex subsystems, and those behave to a degree as a population, with each member having a tolerance zone, interconnections to others, unique capabilities and characteristics, and unique weaknesses. During the system kick, some of those will fail too, and some will find new opportunities and strengthen. Some will adapt and muddle through.

It has yet to be seen if Japan (or the US) is a slinky sitting on the floor (knock it over and in boings back and forth) or on the stairs (knock it over and it'll slowly walk down a series of plateaus).

I tend to think it's stairs, but wide ones, each an energy and wealth plateau. Catabolic collapse reduces support but also decreases needs, and eventually stasis may be regained. The probability of climbing up a few more stairs gets really small though -- that takes energy from outside.

Chinese hit by over-inflated house prices

Booming house construction and rising home prices are contributing to an inflation hike in China. Economists fear the housing market is over-inflated and the bubble is about to burst.

Last year, more than 65 million old homes remained empty due to the high prices.

Interactive overview of global house prices and rents

This interactive tool enables you to compare nominal and real house prices across 20 countries over time. And to get a sense of whether buying a property is becoming more or less affordable, you can also look at the changing relationships between house prices and rents, and between house prices and incomes.

In a few countries, like China and France, values look dangerously frothy.

Completely off topic but so nice to see the evil old buzzard finally get a taste of his own medicine.

Maybe 'Faux News' will get swept up.

AP source: FBI probing News Corp. 9/11 phone link

The FBI has opened an investigation into allegations that media mogul Rupert Murdoch's News Corp. sought to hack into the phones of Sept. 11 victims, a law enforcement official said Thursday.

The decision to investigate was made after U.S. Rep. Peter King, a Republican, wrote FBI Director Robert Mueller demanding an investigation,

News Corp. assets include Fox News, the 20th Century Fox movie studio, The Wall Street Journal, the New York Post

Also Thursday, Scotland Yard said it had made its seventh arrest related to the inquiry into phone hacking at the now-defunct tabloid

...really good.

Yeah. Why do comedians "get it" more than anyone else? From Chaucer to Carlin to Python to Jon Stewart and on......

A couple of interesting data points from the JPM earnings presentation:
- page 9, the net charge-off rate on credit card balances has dropped to 5.28%. The rule of thumb is that this number should be roughly equal to the unemployment rate, and it was last year. Either Chase has gotten really good at picking good credit risk consumers, or this is more evidence that the unemployment situation is structural, i.e. people with jobs are keeping them, and people without jobs can't find new ones that they are suited for.

- page 17, delinquencies, both 30-150 day late and 150+ days late, are generally declining.

Anecdotally, there is something weird in the unemployment picture.

I know the company I work for has been hiring, but struggle fill senior positions. My wife's company is hiring here and there, and struggles to fill a modest-skill lab job, and even shipping staff has high turnover. Both of these companies pay decently compared to the area. Both are "product" companies, though without much in-house manufacturing.

It almost seems like a lot of people who don't have jobs aren't looking, or there are an awful lot of workers who aren't capable of much. For sure those with jobs are not out looking to move.

Paleo - I hear similar from my various oil patch contractors. Just hiring truck drivers that can get DOT certification is holding back expansion. They would buy 100 new trucks tomorrow but can only hire 20 drivers. And oil field trucking is a huge cash cow these days. Just yesterday I signed a stack of trucking invoices for last month that totaled over $80,000. And we're a rather small operator. Some of the big players in the Eagle Ford Shale are dropping over a half million a month just on trucking.

At the risk of sounding unsympathetic it seems a lot of folks who lost low level jobs were just barely up to the task. And it would make sense that the economy would first shed itself of jobs that provided little revenue for their operations. A while back someone posted a report about what a large percentage of college grads were working at jobs that didn't require a college degree. Doesn't sound good for the grads but think about the high school drop outs who has to compete with those college grads. That's has to be very depressing.

My wife's company is hiring here and there, and struggles to fill a modest-skill lab job, and even shipping staff has high turnover

I don't find that weird at all. We humans tend to be creatures of habit. How likely do you think it would be for someone who say worked in IT for the last 15 years and has been out of work for over a year to be aware that there is a position for a modest-skill lab job available. And then even if such a person were willing and able to learn the necessary skills to do such a job would the lab be willing to take a risk and train this person?

I think you'd be hard pressed to argue that a highly skilled specialist in one area isn't capable of much. The question is how do you transfer what that person can do to the available jobs in a timely and efficient manner.
I think both those who are hiring and the available pool of unemployed need to be much more flexible and creative given the current circumstances. Unfortunately the deck is heavily stacked against that happening.

There is actually a very large available pool of highly skilled workers out there but they aren't necessarily credentialed for the available jobs in their particular location. This is another consequence of the ever more narrow specialization that had become necessary in our current economy. There are very few generally skilled jacks of all trades who can easily move from one area to another.

Not only that, but being a generalist carries with it a certain stigma and such people tend to be looked down on and are considered less valuable. Though as time goes by that may again change.

It almost seems like a lot of people who don't have jobs aren't looking, or there are an awful lot of workers who aren't capable of much.

I think a lot of companies have concluded that those that don't have jobs are a bad risk. They'd rather steal an employee from someone else. That creates a situation where if you do lose your job, you get typecast as unemployable.

I've seen a few articles written by employers on that subject. Some are only hiring people who are currently employed (or who manage to make themselves look that way on CVs with freelance work or volunteer work). Looking more and more like victims of the economy are blamed by potential employers for their misfortune.


Oddly, this was not the mindset I've seen. The thinking was "with so many unemployed, some good people must be in the mix", and resumes are taken from all venues. Those hand-carried by a current employee always have some preference, though.

I think some of it might be selective recession -- those segments that are doing well have exhausted the pool, while struggling segments continue to throw off workers. Retraining isn't always easy or cheap.

There may be a psychological issue on the side of those unemployed as well. Perhaps it's hard to network confidently when your entire network is swamped with others looking for jobs, and harder still when many contacts aren't at their old phone numbers and e-mail addresses.

The thinking was "with so many unemployed, some good people must be in the mix", and resumes are taken from all venues. Those hand-carried by a current employee always have some preference, though.

Thats what you'd hope would happen. I've only read anecdotal reports that claim the attitude that anyone without work need not apply.

Part of the psychological issue could be continued rejection. Its hard to be being told, you aren't wanted. Some will quit trying rather than have to experience anymore of that.

While it likely goes both ways, here's some of the current thought on employment:


Better yet, here's an article that supposedly quotes employers who say they don't want to hire people who have been laid off -


This one cites an LA Times article and quotes employers who do not want to employ the unemployed - http://www.outsidethebeltway.com/unemployed-dont-bother-applying/

There are dozens more articles like this. It's a hard world out there.
Add a bit of age discrimination or what have you - has to be virtually impossible for some people to find jobs.


employers who say they don't want to hire people who have been laid off

There is a mixed message/threat in all this.

Employers who make it known to their own employees that "once-fired, you will never be re-hired" are making it clear as to who's the boss and who has life versus death powers over you. Step out of line and you will find yourself among the "never re-hired ones".

Scientists Discover Drug-Resistant Gonorrhea 'Superbug'

A new, untreatable strain of the sexually transmitted disease gonorrhea has been discovered in Japan, according to an international team of infectious disease experts. The strain, named H041, is resistant to all known forms of antibiotics.

The finding was presented Monday with extensive laboratory evidence at a conference in Quebec City, Canada — and it comes just three days after the Centers for Disease Control and Prevention (CDC) warned that U.S. gonorrhea samples had being showing new signs of drug resistance as well. Although drugs have remained effective in almost all U.S. cases, the CDC said that analysis of bacteria samples taken from 2000 to 2010 showed that the gonorrhea bug was becoming less and less susceptible to the frontline drugs, cephalosporins, as the years went by.

"This is both an alarming and a predictable discovery," Dr. Magnus Unemo said in a statement about H041. Unemo, based at the Swedish Reference Laboratory for Pathogenic Neisseria, worked with Japanese colleagues to characterize the new H041 multidrug-resistant gonorrhea strain.

A plague of untreatable gonorrhea may affect population growth, since a significant percentage of women become infertile.

See also Gonococcal infection, infertility, and population growth: I. Endemic states in behaviourally homogeneous growing populations

Sexually transmitted diseases such as gonorrhoea are a significant cause of infertility in women when the infection is untreated. They have the potential to alter human population growth rates in many developing countries where sexually transmitted diseases are prevalent due to limited public health facilities for diagnosis and treatment. The authors develop a simple model describing the conditions under which such a disease can exist in a growing population in which sexual partners are chosen at random by proportionate mixing. Using the model, the impact that such a disease could have for a range of possible parameters is examined. Then a full parameter set for gonorrhoea in a developing country is estimated. Analysis demonstrates the significant influence gonococcal infection may have in reducing population growth rate in some communities. For example, the simple model predicts that a prevalence of 20% in sexually active adults results in a 50% reduction in the population growth rate. Finally, the authors discuss how potential control initiatives may change the parameter values that determine transmission and alter the demographic impact of gonorrhoea.

Given increasing numbers of superbugs, an adequate Vitamin D blood level is more important than ever. After taking about 5,000 IU of Vitamin D3 for several months, my wife and I finally got our 25(OH)D blood levels up to the optimum range, 55 ng/mL for both of us. My doc is consistently finding that 90%+ of her new patients, in the Dallas area, are deficient, i.e., less than 30 ng/mL.

It appears like that many, if not most, cancers and many diseases are primarily symptoms of Vitamin D deficiency.

Vitamin D crucial to activating immune defenses

Scientists at the University of Copenhagen have discovered that Vitamin D is crucial to activating our immune defenses and that without sufficient intake of the vitamin, the killer cells of the immune system – T cells - will not be able to react to and fight off serious infections in the body.

For T cells to detect and kill foreign pathogens such as clumps of bacteria or viruses, the cells must first be 'triggered' into action and 'transform' from inactive and harmless immune cells into killer cells that are primed to seek out and destroy all traces of a foreign pathogen. The researchers found that the T cells rely on vitamin D in order to activate and they would remain dormant, 'naïve' to the possibility of threat if vitamin D is lacking in the blood.

Scientists taking vitamin D in droves

“I’ve talked casually with virtually everyone [in the vitamin D research community] that I am in contact with and they’re all taking vitamin D and they’re taking it in doses greater than 1,000,” Dr. Heaney says.

As an example, he cited a meeting a year ago of nine experts on the nutrient at the U.S. Centers for Disease Control, where he circulated a sheet and asked them to jot down how much they took. The amounts: 3,000 to 10,000 IU, with an average of 5,000 IU.

Short Cooper Clinic video on Vitamin D:

Absent the cure with antibiotics, the strategies of building up the immune system, physical distance between individuals, hygiene like frequent hand washing, and vaccines for immunization are some of the remaining strategies for preventing epidemics.

There was an interesting case history back during the H1N1 epidemic. A institution, I think that cared for mentally disabled patients, monitored their patients' Vitamin D levels, and supplemented in most cases. The medical and support staff was not monitored, and therefore was probably representative of the population as a whole, i.e., probably 90%+ deficient in Vitamin D levels.

In any case, the H1N1 virus was introduced, via an incoming patient, and the H1N1 virus spread like crazy among the medical and support staff, but the transmission rate among the patients was practically zero.

Speaking of the flu, a link to the trailer for a movie, "Contagion," due out this fall, about a lethal bird flu pandemic:


Weird that something made in our skin from contact with sunlight should need to be supplemented. I can see why disabled patients might suffer from low amounts but average joe should not have a problem. Sounds like hype.

Over the age of 40, we lose the majority of our ability to synthesize Vitamin D. And of course distance from the equator is a factor, as is the time of year, along with the increased use of sunscreen (check out the Cooper Clinic video up the thread). It's virtually impossible to get enough sunlight in northern climates during the winter to synthesize the Vitamin D you need. I believe that virtually all cancers, except for skin cancer, increase as the distance from the equator increases. We see the same phenomenon with MS cases. Finally, here in the Dallas area, my doc has found that 90% her patients are deficient, i.e., below 30 ng/mL, and this is consistent with what other studies have shown.

If you haven't had your blood level tested, you don't know whether or not you are deficient.

Ooh, a depressing health-care post! My favorite!

I saw this story, but I didn't really think about it, just used it as fuel for my existential despair. But yeah-- there are many wild cards that could slow population growth very quickly, and most of them are pretty nasty.

Anyway, for anyone running short of things to worry about, here's a cheerful little story about the condom shortage in Namibia:


Is there a post-peak plan in place yet for condom manufacturing?

What is a "doomer"? Am I becoming one? Yikes!

And here's me thinking PO is just a 'Transportation problem'..

..good reminder of where the Rubber meets the Road!

For example, the simple model predicts that a prevalence of 20% in sexually active adults results in a 50% reduction in the population growth rate.

"Well, that's obviously not enough, since that still allows the population to continue growing. We need to find a way to increase it way beyond a prevalence of a mere 20% if we expect it to help in stopping population growth completely."
(spoken in a voice sounding eerily like Dr. Albert Bartlett's)

Seriously, though, I am not surprised at all by this story, what surprises me is that we don't hear significantly more stories like it. Perhaps there are many other silent antibiotic resistant epidemics just waiting to burst forth upon the human populations throughout the world.

Nature is supposed to be a self correcting system, we may have been somewhat successful in thwarting a few of its self regulatory mechanisms due to our access to seemingly unlimited energy resources. Perhaps the ending of our easy access to the energy required to muster artificial defenses through education, medicine and increased hygiene, coupled with the perfect storm, of Darwinian evolutionary mechanisms, acting on pathogens that we have so far managed to keep in check, will finally be the undoing of our unmitigated population growth.

So it is beginning to become ever more clear that it was only our colossal self delusion and extreme hubris that has allowed us to mistakenly conclude that we had finally vanquished so many of our microbial nemeses.

It seems Nature may have the last laugh or two...

The world will be saved by plague of the clap. ;-)

Ron P.

It is a far from novel idea. In 1898, H G Wells wrote "The War of the Worlds" in which bacteria save the world.

I believe it was renowned venereal disease expert Eddie Murphy who noted the increased virulence of sexually communicable diseases and surmised that the logical conclusion was that in the future, there would be a disease that would cause a woman's partner to spontaneously combust upon beginning the act of coitus.

Even worse than the Praying Mantis.

Sexual cannibalism is common among mantises in captivity, and under some circumstances may also be observed in the field. The female may start feeding by biting off the male’s head (as they do with regular prey), and if mating had begun, the male’s movements may become even more vigorous in its delivery of sperm. Early researchers thought that because copulatory movement is controlled by a ganglion in the abdomen, not the head, removal of the male’s head was a reproductive strategy by females to enhance fertilisation while obtaining sustenance. Later, this behavior appeared to be an artifact of intrusive laboratory observation. Whether the behavior in the field is natural, or also the result of distractions caused by the human observer, remains controversial.

It seems that there are several families into which the larger number of proprietary antibiotics fall. One by one bacteria are developing resistance to each family. Since bacteria swap genetic material pretty easily, this resistance spreads throughout the various types of pathogenic bacteria.

It is possible that the nadir of infectious disease may coincide with the peak in oil.

From the articlea bout the Libyan rebels above:

About 70 percent of the country relies on water drawn from underground aquifers deep in the southern desert, and the plant powering it in the east is falling apart, Elgowood said.

Okey, this is bad. How long do they think this water will last? As long as their oil? This will be the next big bad news from Libya, after the rebels have won.

Moscow to double in geographical size to ease overcrowding
Russia reveals plan for capital to absorb woodland and holiday towns but critics warn of impending environmental disaster

Probably not the best idea.

Russian population shrinking and abandoning the countryside, small towns and regional cities for the Big City ! There is a functional limit to such trends.

I am willing to bet that the superb Moscow Metro will not be expanded to the same density in the "New Moscow". But perhaps the buildings will be more energy effiicent.

Many Soviet era apartment blocks are falling apart. Build replacements on-site or elsewhere ? Current locations are quite dreary.

Not very productive farmland @ Moscow from what little I know.

Oh Well,


Well, for southern California now, it is possible to drive along the coast from the Mexico border up to Santa Barbara and it is almost all city.

When I was a kid, there were big open spaces between San Diego, Los Angeles, and Santa Barbara, but all seems one big contiguous set of cities, a la "Bladerunner."

Decades ago, Heinlein wrote a short story that included a "strip city" along the Front Range of Colorado. It's not there yet, but there aren't very many completely empty gaps (ie, out of sight of a housing development) left between Colorado Springs on the south and Fort Collins on the north. A million new people moved into that strip in the last 20 years; the next million is forecast to only take 15 years to arrive.

Computer game gives people shot at managing budget

... In a quick demonstration of the game, two college students, one taking typical Republican positions and the other Democratic, showed just how difficult it will be to save the country. The Republican extended the Bush-era tax cuts, cut spending for the arts and humanities and reduced congressional budgets. The Democrat went after a green badge by raising the federal tax on gasoline and ending tax breaks for big oil companies, while also expanding health insurance coverage.

Both plans saw the government go broke - reaching a point where there isn't enough money to cover mandatory programs such as Social Security, Medicare and interest on the debt - in the 2030s.

"This game will lead you to the conclusion that there has to be structural change" in the big entitlement and revenue programs, said John Tanner, a former Democratic lawmaker from Tennessee.

The game is free and available at http://www.budgethero.org .

I played around with that game a little last year, but it is very limited in scope, and doesn't let you change much. There are specific changes that you can choose to make or not make, rather than letting you play with each individual program, or set tax levels where you want them.

Apparently they rewrote the 2008 version this year. There may be some changes

I played around with that game a little last year, but it is very limited in scope, and doesn't let you change much.

They were probably going for realism then.

It did not allow me to cut the military by 80% so I view it as worthless.

Native seeds in danger of being monopolised

Chile recently ratified a treaty that could threaten biodiversity and endanger the rights of small farmers, critics say.

"We asked for it not to be brought to a vote, but the government piled on the pressure, and the right generally supported it, because big companies want the Convention now, they want to start protecting their investments as soon as possible," Lucía Sepúlveda, representing the Alliance for a Better Quality of Life/Pesticide Action Network of Chile (RAP-AL Chile), said.

In the senators' view, the Convention reduces farmers' rights, violates property rights and endangers the traditional knowledge held by communities.

According to the Convention, a plant that is not regularly traded in the market or does not appear in an official register may be considered novel or distinct. Therefore, a company could appropriate the knowledge and biodiversity that are the heritage of small farmer and indigenous communities, without the need for legal expropriation or any compensation whatsoever.

Iraq Déjà Vu

Administration Grossly Underestimated Carbon Cost, Says Study

The social cost of carbon, the economic value of avoiding the negative consequences of climate change, could be close to $900 per ton of CO2 in a worst-case scenario -- nearly 45 times the $21 per ton established two years ago, according to a study by the group Economics for Equity and the Environment (E3).

... "The very low numbers are based on outdated and unrealistically optimistic estimates on what's going to happen," he said. The justification for the $21-per-ton carbon cost was based on studies up to 15 years old, when a strong economy and a rudimentary understanding of climate change offered a relatively confident outlook, said Ackerman.

"The balance has shifted very heavily in a different direction," he added.

High bills force more homes into ‘fuel poverty'

Higher energy bills forced an extra 1m British households into “fuel poverty” in the space of a year, according to an official study.

Calculations by the Department of Energy and Climate Change, published on Thursday, showed a rising number of households compelled to spend at least 10 per cent of their annual incomes on natural gas and electricity.

The total grew from 4.5m in 2008 to 5.5m households in 2009, the latest year covered by government figures. Over this period, average retail gas prices rose by 14 per cent and electricity by 5 per cent. Since then, energy bills have climbed by significantly greater amounts, leading campaigners to say that the number of “fuel poor” households will have risen still further.

also Fuel poverty affects one in five households

Australia faces prospect of being unable to feed itself

... Climate scientists predict that if countries meet their current targets to reduce greenhouse gas emissions, global temperatures will rise by 4 degrees some time between 2055 and 2100.

Australia's agricultural output will have shrunk so severely by the latter half of this century that it will no longer grow enough food to feed its populace, forcing the nation to rely on imports to meet demand.

Food imports from where ?

Kind of like when ELM catches up with Saudi Arabia, where will they import oil from ?


Yes, Given that Australia produces about 2.5 times as much as it consumes, If it gets to the point where climate change has forced Australia to import, the rest of the world will be far worse off, and collapse will already be underway.

That report reeks of scaremongering, and "give us (the scientific community) more money to do more research and more modelling on climate change"

This is not to say that work shouldn't be done, but more effort, in Australia, needs to go into adaptive strategies, as there is very little Australia can do to influence climate change/CO2.

Yair...slightly O/T but may be of interest. Most folks don't realise that unlike most other countrys the Australian grazing country or range land is largely artificial and has been created by chaining.

The Acacia and Eucalypt regrowth needs to be continuously controlled by follow up chaining, raking or spraying. Once fuel becomes too expensive these productive lands will revert back to an unatural over grown unproductive scrubland where a dog could'nt wag his tail.

The link shows the old darlin's I ran back in the 'sixtys...and yes Paul Nash they were pilot motor start, when Caterpillar went to direct electric they lost much of their mystique.

Can any one tell me about "Black Fuel"? It was phased out in the late 'sixtys and was a cheaper alternative diesel fuel you could run in Lanz Bulldogs and the Cats. It was more volatile than diesel as it would go "whump" in the cookfire a bit like petrol when you hit it with a match.



I wonder if it would be an interesting future Oil Drum article to keep an up-to-date list of a few 'canary in the coal mine' indicators that could be revisited and updated from time to time.

I know for the US, the decline of exports of petroleum and petroleum products from Mexico to the US is a worry, for example.
I think Egypt has gotten a lot of discussion.

...but I am not remembering if there was an article that looked at 'canary in a coal mine' point of view on such.

Will you just look at that spread? Whichever bank said it might go to $40 is looking pretty smart right now.

The record was $23.32 intra-day on 15th June so we are still slightly short of breaking that at about $22.65 right now.

US solution to oil crisis simulation: drill more

Former White House officials take part in Oil ShockWave war game to determine US response to a terrorist attack on Saudi oil supplies

... "We are reaping the harvest of our dependence on petroleum and the fact that the countries that produce it are either unstable or hostile to our interests," lamented Stephen Hadley, who reprised his real-life role as Bush's national security adviser. "How did we let this happen when we've known we've been dependent on oil for 20 years?"

17 November, 2011: A helicopter gunship attack, possibly by al-Qaida militants, has disabled the world's largest crude processing facility in Saudi Arabia, turning the sky a bright fiery orange and knocking out a significant chunk of global oil supply.

In Washington, the national security team assembles to advise the president on how best to reassure the public and stop the US sliding back into recession. Their solution? Drill more American oil.

One month on, the crisis intensifies. Iran and Venezuela threaten to choke off oil supplies, pushing oil prices to $200 a barrel. The reaction once again: drill more American oil.

... The fictional energy secretary, played by the former Shell chief executive, John Hofmeister, gave assurances about US domestic supply. Nobody called for an accelerated transition to renewable energies. Nobody mentioned climate change.

also http://secureenergy.org/projects/national-summit-energy-security

S - Thanks...Been running through invoices all day and very badly needed a good laugh. Some many aspects to pick on but I'll toss out the obvious.

First, of the 30 or so folks developing the response model only one (John Hofmeister, former President and CEO of Shell Oil Co.) had any practical exploration experience.

One more statement to highlight: "The president has to do something bold. He has a real challenge to his leadership," Ari Fleischer said. "He either has to announce we are going to open up America to take every tract of land that was previously closed and open it up for drilling, or make America green and go in the direction of wind and solar," he said. "Anything else is just doodling in the margins of history. We need to put the president on track for something big."

I don't know the actual number but I can make a good guess IMHO: At least 90% of all the land any company has ever wanted to and every will want to drill on has been available for many decades. We're already to start drilling in the DW GOM. Just will take a while to ramp back up. So today, with $100 oil, US companies are drilling anything that has even a remote possibility of producing oil. And doing so even if the profit looks thin. But their entire response hinges on a sudden loss of a significant volume of imported oil that would be dealt with by getting more rigs to drill. I could go on for thousands of words explaining that absurdity of such an assumption but I think most every here already understand.

And the second possible solution: instantly ramp up all the alts in a matter of months so we can offset the decrease in imported oil. And these are the folks many of the public feel will save them when the time comes. What a hopeless situation. But I do agree with that one statement:"We need to put the president on track for something big." And the only question will be the body count IMHO.

John Hofmeister, former President and CEO of Shell Oil Co.) had any practical exploration experience

Not really.

Mr. Hofmeister came up through Human Resources, and one of the major projects he supervised before taking over Shell (USA) was supervising the construction of a new HQ for Royal Dutch Shell in the Netherlands.

Only when he got to the top did he have anything to do with exploration.

BTW, he was not respected by locals at One Shell in New Orleans.


Alan - Didn't know that..thanks. So the one bright shining star doesn't really shine that bright. What was really shocking about the article was that the proposed quick solutions to the hypothetical quickly developed crisis wasn't doable in a few years let alone months. Set "drill, baby, drill" aside and consider the propostion that we would ramp up alts almost overnight to replace lost oil. Heck...we're making feeble attemps now and obviously we haven't had a supply problem. I found the overall tone disgusting to be honest: the US is going to "think" their way out of such an energy crisis. The lack of grasp on reality is truly strange.

I agree.

Relevant would be talking about how to release the SPR, what we could do to get people off home heating oil before next winter, encourage Americans to use much less plastic.

Also encourage "Patriotic Bicycling". Ask cities to convert some prime car parking spots to bike parking, and businesses too. As well as "showers before work" at downtown health clubs, businesses, YMCAs, etc.

Driving less would be almost a given, but asking Apple, etc. to come up with car pooling apps would be good. Bring the railroads and trucking in to discuss ways to do more with less oil. During WW I & II there was a lot of track sharing between RRs.

Expand urban rail service with more cars (and some beef up of electrical supplies). Keep scheduled to be retired cars in service, speed up deliveries of new cars and start new orders.

We could get some rail electrification done quickly. LA to Chicago - 130-135 trains/day (including 6 passenger trains @ 90 mph) - in 30 months (maybe 32). Florida East Coast - Miami to Jacksonville - plus State of Florida owned tracks for TriRail in south Florida, all at 90 mph top speed. Extend electrified Amtrak NEC south from DC to Richmond and the electrified Harrisburg spur to Pittsburgh. Much more after that !

Eliminate flights between East Coast cities - Boston, Providence, NYC, Philly, Baltimore, DC and soon Richmond - use electric Amtrak instead. Fly slower to save fuel.

Encourage electrical conservation, to save diesel moving coal. Massive solar PV and solar hot water in Hawaii and Puerto Rico to use less oil fired electricity there.

That is with 5 minutes off the top of my head.

Best Hopes for Rational Plans (and you know what I mean)


Put a 100A fuse on everyone's power entrance.

I am still trying to figure out how an enemy helicopter gets to the KSA oil facility. You'd think the military is kind of watching that one, no?

But yes I agree Oil Drilling is already under pursuit anyway and alts would not be run up fast enough to replace the losses in oil inputs.

A disaster will hit sooner or later I imagine. I expect Mother Nature to deal the blow and not terrorists but that is just because Mother Nature tends to do a lot more damage than discontent muslims -- at least so far.

Compare Japan's Tsunami to 911 or any major hurricane to 911 for that matter.

Heck tornados well placed are just plain nasty. No terrorists required.

Fixed in place infrastructure is not defended well against Mother Nature. Maybe the DOD will come up with a Mother Nature defense system.

With a possible $1.5 trillion spending cut on the horzon, how can that be good for the equities market? And I guess in the same discussion, how can that be bullish for the use of oil? That's a whole lot of consumption that won't be happening. How could we not slip back into recession (did we ever leave)?

$1.5 trillion spending cut, spread over 10 years, backloaded onto the last 3-4. Don't fall for the hype.

Good point. Thanks for the added insight.

This really captures the Zeitgeist of our current situation

A Man Like America

Being an American right now can feel like this.

Here is an interesting project the Sahara Solar Breeder Project. Make lots of PV using PV and sand. Japan and Algeria are teaming up.


This is precisely the kind of experiment we need to be doing and watching very carefully. Alternative energy sources cannot be called renewable or sustainable unless those sources supply all of the energy needed to reproduce/maintain themselves as well as supplying the non-energy economy. Or at least some combination/mix of various alternative sources need to be able to do so in the aggregate. Once the fossil fuel spigot is turned off, that is the only way we can have an operating economy moving long into the future.

Personally I have a wait-and-see attitude tending toward mildly skeptical of the feasibility. I've attempted to model fully self-sustaining energy systems such as solar thermal and have not seen numbers that would give me hope. But a lot depends on the amount of net energy that has to be supplied to the non-energy part of the economy. If we don't get usage/demand under control this may be a doomed effort.

Also I hope they don't try to take the biggest possible bite from the get-go. Trying to tackle too large a scale may doom them, especially when there are so many technical hurdles to overcome. A pilot project should be just large enough to provide information about scaling issues, but not so large as to destroy credibility when some of those issues cause delays.

I continue find this to be a fairly arbitrary and arcane demand, ie.. 'We must Make PV with PV' ...

I do, however, think it's critical to look at the production cycles of Renewables, and of other critical components of our modern 'toolbase', if you will (Electronics, Heavy Engineering, Precision Equipment, Specialized Materials) and get a real concrete understanding of which aspects of them ARE truly dependent on an oil-driven economy.

I don't think the problem is the Raw amount of power required to run the plants and the supply chain, I think it really is going to hinge on locating the particularly WEAK LINKS in that chain, links that work today because a Cheap-Oil-driven economy makes some unusual component or material that feeds the process SEEM to be readily available, which could 'not show up to work' one day when there was a long enough diesel outage or something..

For energy intensive and 24/7 processes like Silicon purification, I don't see why industries like that can't be located in proximity to Large Hydro in a 'post-oil' scenario, where they can be fed continually as they must (if this is really a must).. but demanding that a Diurnal Energy Source has to be used to create PV always comes across as an essentially defeatist ploy to my ear.

The achilles heel is elsewhere, IMO.

I generally agree.

However, GWs of PV solar and pumped storage is a very viable solution as well. Perhaps add a bit of wind (which usually peaks in the winter) to reduce seasonal variability.

I some times think of the undeveloped 40 GW Grand Inga project. A global center for a number of power intensive industries.

Run-of-river type scheme on remarkably even water flow for 50 weeks/year. Schedule two weeks for maintenance and vacation.

Best Hopes for more renewables,


Totally agree.

I'm just nonplussed by this idea that only if a type of renewable can 'regenerate itself'.. has it been validated.

Make nuclear without oil. Right now, not in some all-electric fantasy future.

Utterly insane.

They make no mention of the rare earth elements that are needed for current high efficiency panels. Silicon is one thing; it's those other compounds that turn it into a PV panel. Where will those come from?

Considering the volumes of these are far smaller, I don't see why these can't be shipped to the factories as they are today. As has been said lately, the "RARE" in rare earths is a little bit of a misnomer as well.

Part of my objection to the insistence on having this sort of 'Euclidean' exercise, in other words that it be 'totally self-sufficient, independent and therefore a Pure experiment'.. is that it need not be that at all. We'll still have ships and people will no doubt continue to operate trade routes over the seas, certainly these will be required in order to export their Panels..

There is a conceit in our 'Science-mindedness' that insists on isolation, as if that is the only way to yield TRUE answers.. 'There is more under Heaven and Stars Horatio than is seen in our Petri Dishes..'

Aristide referenced a similar idea when he returned to Haiti recently,
"because the problem is exclusion, and the solution is inclusion."

Why does this one keep turning up. It has been addressed several times. Rare Earth elements are not used in bulk Silicon PV panels.


According to the diagram the plan includes desalination of sea water, the construction of aqueducts and use of the desalinated water to irrigate desert to create forests. They are talking about using an underground / underwater superconducting electrical transmission lines that are thousands of kilometers long and require liquid nitrogen to regulate the temperature of the superconductor. I suppose these researchers need $10 million over 5 years just to calculate the prohibitive cost and low ERoEI of this absurd proposal.