Oil Prices and Vehicle Miles
Submitted by
CalculatedRisk on Sun, 03/21/2010 - 1:28pm (112 comments)
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Posting to a previous thread --
Good for the FHLB! The PLRMBS misrepresentations by Wall Street should be brought to light. The only problem is, there is no way to make the banks feel any pain, since the Fed makes sure to give them free raw material (money), which the banks can use however they wish. No other industry gets its raw material from the gov't.
The banks profits and stock prices are protected for as long as there is a Fed; the damage to the bankers' reputation might be severe, but only temporary.
its not oil its earl
mock turtle wrote:
"The Kashagan oil field in northwest Kazhakstan, as well as the recently discovered, amazingly large (4-14 trillion cubic meters) Yoloten-Osman natural gas field in southeast Turkmenistan, “need” a non-Russian, non-Iranian, non-Chinese, western controlled outlet to the world energy market. This could be via pipelines from southeast Turkmenistan through western Afghanistan and western Pakistan to either the Port of Gwadar (after the Chinese are displaced) or to Karachi, Pakistan. Coincidentally, such a pipeline corridor would have to transit right through the areas where Taliban and terrorists strongholds have recently been “discovered”. Kind of nifty; two birds with one set of dead American soldiers.
This fight for pipeline corridors is a real win-win for the western oil companies. They get the U.S. military and the American lives lost in the process free of charge, and they get to make a fortune (Halliburton) hauling the military supplies from half-a-world away. After its all over, presuming things turn out the way they would like, they can then sell the oil and gas east to the highest bidder, i.e. India, China, South Korea, and Japan and thereby continue to decimate the job market here in the U.S. of A."
-kiw
And of course there is this:
World oil production peaked in 2008 at 81.73 million barrels/day (mbd) shown in the chart below. This oil definition includes crude oil, lease condensate, oil sands and natural gas plant liquids. If natural gas plant liquids are excluded, then the production peak remains in 2008 but at 73.79 mbd. However, if oil sands are also excluded then crude oil and lease condensate production peaked in 2005 at 72.75 mbd.
We are on a plateau, and the edge to go over is coming in the near future.
I find that we are all talking about natural gas an entire world away. Thanks to modern drilling, I suspect only oil is worth transporting that far. Further, I don't think a pipeline through Afghanistan would ever work or be profitable. Too easy to blow up.
So talk about anything else, and make some sense.
Pipelines in Afghanistan=Democracy in Afghanistan=Not gonna happen.
Someday this war's gonna end...
I've seen a BIG push from many large companies to move people to "work from home arrangements" so that they can shutter office buildings. This has to be impacting miles driven, but maybe not oil consumed. Lots of those homeowners would have shut off the heat/AC while they were at work...
Citizen AllenM wrote:
I agree for the US, but not for Asia. Iran and Russia have huge amounts also.
And I agree, Afghanistan will never work out. Seems highly improbable.
longwaver wrote:
Let's save RRE by destroying CRE. All in favor raise hands.
Here is an animated GIF of an actor playing Ben Bernanke protecting unsustainable price levels, http://i.imgur.com/8exZM.gif
I think what we are truly seeing is the end result of vast amounts of oil being available cheaply in the American Economy. Now the Chinese would like access to that oil, and we have essentially collapsed in terms of growth of energy use and in terms of economic consumption. The really funny part is that there is a large amount of oil available at prices that are really high, even with a depressed dollar. Why else are we importing refined gasoline from as far away as Europe? What has happened is the traders in New York wanted a quick bubble in a small market to make up for the damage they took on the way down as the big bubble popped. Now they have got it big time. Meanwhile, the big energy companies are concerned about a Chinese stumble that could put oil back to $40 muy pronto.
Imagine all of those alternative sources of energy at $40 a barrel, most of them are simply dead in the water. If this is turning into 1931....that is next.
Someday this war's gonna end...
There are ~140 LNG carriers on order in shipyards across the world and ~350 in service. (LNG Fleet And Terminals
Africa demonstrates no place is too unstable to thwart pipelines, but in those areas they are almost never feeding American interests. For example: West Africa Pipelines map - Crude Oil (petroleum) pipelines - Natural Gas pipelines - Products pipelines
Citizen AllenM wrote:
seems like when we "install" the right leadership the oil just flows to us , er uh i mean to the oil companies
house of saud (cultivated all the way back to WW@ and roosevelt
Reza Shah Pahlavi in iran (our guy replaced the elected leader in a coup MI5 and CIA sponsored)
saddam hussein (at first he was our guy, but then...oops he went soft on us so we nailed him)
and so it will be where ever, we, i mean the master of puppets , our illustrious leaders, TPTB decide
whos making sense?
Merkel is in pretty serious trouble. The NRW election will tell us a lot more but the government is considered in severe disarray, something not seen before in Merkel's time and in fact also not seen during Schroeder's reign. Lots of infighting within the coalition.
I don't think that we will a significant expansion in spending but also no real cut backs. In fact, the FDP will insist on some form of tax cuts which were promised during the election.
The Greece story has to be viewed through this prism. German's are seriously worried about inflation as a result of government spending as ridiculous as this is at the present time IMO. However, their national experience has conditioned them to worry much more about inflation than deflation. Serious investment newsletters sound like the most ardent goldbugs you can find. Simply amazing but understandable.
With that background, it makes it very difficult for Merkel to go on her own despite her clear promises to Greece. Schäuble is one of the few that carries the EU torch and as the old statesman he is he has little to lose. He is his own man. But with his reputation it will be considered an act of desperation if he had to go.
So I expect a continuation of the status quo which won't resolve anything. IFO and ZEW have both turned down which doesn't augur well. With German exports now under fire from within the EU a interesting battle is brewing. In some ways it is China vs. U.S. redux but within an EU context. However, understand that German politicians do understand that Germany as part of the EU is much more powerful and influential than a Germany on its own, a fact that many outside of Germany miss.
I guess where the comparison between Canadian and German politics breaks down in the short term is that there isn't any party clearly to the right of the minority Conservative Government
If Merkel were smart, she'd let others take the leadership so that she can come back as a saviour later
Afghanistan is different.Read a little history,then tell me that a pipeline is feasible long or even mid term.
it's over, China won, can't compete with their birthday candles, YouTube - New type of birthday candles
longwaver wrote:
That is fascinating. In the category of effects I've never thought of. You say the companies are making the push - but doesn't it mean a surrender of worker control? Very interesting stuff!
EvilHenryPaulson wrote:
Hmmm... I watched the whole thing waiting for it to explode. Turned out to be a
From what I've seen so far people that are good at understanding the economic situation get burned badly when they get involved with commodities. Literally its a different world.
In any case I bet CR is horribly wrong. And I'll keep it short. VMT was flat to falling most of the time that prices where rising. Its a good indicator of oil usage but says nothing about price. Indeed prices went two different directions. And shame on you for not posting the raw VMT numbers in your paper you really should add that as it discounts your premise. The rate of increase in VMT indeed going negative has been happening for years with prices going steadily higher until they did not. Then we had rising VMT with rising prices.
I expect the future will show in general that VMT will be falling flat or rising with rising oil prices. If VMT is flat oil prices will increase if it falls oil prices will increase and if it rises oil prices will increase. Thus using VMT to predict oil prices I'm 100% confident we will see rising oil prices. Mish Shedlock biffed this one big time and has stood by his claim prices will fall.
I'm keenly interested to see if your willing to argue against my prediction about future oil prices using VMT as a predictor.
I'd love to see you dive into this your keen mind could make a good contribution however I hope your not and idiot like Mish Shedlock assuming you understand oil. Obviously from your post you don't not that you need to its not for everyone and eventually oil prices feed back into economics so you don't need to predict them just use them what ever they are for your economic analysis.
In any case other blogs actually cover this stuff. One reason I come here is to not look at oil directly. However I "correct" your observations with my own about oil. The best way to treat oil now from and economic perspective is this.
If we have a sharp financial panic ala 2008 oil prices will fall and I mean sharp as in another move to the brink of collapse.
If we do not have such and event oil prices will rise at some rate the actual rate determined by details of the oil supply itself.
If they go high enough they can play a role in the onset of another panic.
The one argument thats probably incorrect is the one your making and the one Mish actually made that demand is sensitive to oil prices and will pull back causing prices to fall past some key price level. Thats were I see people really good at economics get tripped up by commodities in general and oil in particular. They don't work that way as they are infrastructure components with very inelastic demand despite prices unless so serious financial event scares people enough to think Armageddon is at hand.
Now with that said oil and food are fascinating and important but as said if you go here be very careful you could already be on the wrong path.
Futures trading soon. They always find somethin to love.
Pellice wrote:
It's been a sought-after perk in high tech for years, where working at home part-time or full is fairly common. In the course of a release cycle, members of development teams have deadlines which they must meet. If they make their deadlines -- which are often quite crazy -- that's all that is ever asked. Like that old joke from Microsoft -- we have flex hours, you can work any 80 hours a week you want.
And since you never go to work, you're always at work, and may well be expected to be present for 10 pm or 2 am conference calls to Shanghai or Bangalore. The corps get their money's worth.
RE wrote:
I would agree, but I would add that there are multiple prisms, most importantly the French perhaps. Others figure prominently, such as regional politics in the Balkans and the Cyprus issues to name just two for Greece.
Aside from China, I think Germany is the only country that can think and plan more than about two decades ahead or remember the past beyond two generations, but then I think the Japanese match that as well.
Bob Dobbs wrote:
Yup ... it's a fine line.
Bob Dobbs wrote:
If you take salaried people and let them work from home but give them ridiculous schedules, you effectively sell them their "freedom" in exchange for putting them to work for piece wages....
Bob:
That's why I prefer shiftwork. I've done both, and there is nothing better than turning over the plant, signing out of the logs and going home for 14 hours before you have to be at work.
Cinco - About the pig tillers, I thought that was a great idea too and I also have a pig-hater spouse, but there is always the possibility of renting some piglets for a few days to get your plot cleared out, and then give them back.
Who is paying the price in the recession right now? Middle class workers. Who will pay the price of austerity later? Middle class workers.
The Bucking Bronco Job Market — Part I: Unemployment by industry - Eric Janszen - iTulip.com
The problem in Afghanistan is they can't even manage a national dictatorship- so who are you going to blame when they all start blowing stuff up?
Oh yeah, they do that on a daily basis to folks who are mobile and heavily armed.
Now, a pipeline is a pipedream. Simple equation. Any idea how many mines could be operating in Afghanistan? Quite a few is the answer, but the situation dictates that the only way to extract anything from that place is if the locals are firmly in control and making very large profits, like in the opium trade.
External exploitation isn't gonna happen. Period.
Not without a large scale depopulation event.
Leadership implies a polity that would follow the leaders. Afghanistan came close with the Taliban, but they chummed up with bin Laden and didn't just point the way to the al quaeda base like most of the folks in the middle east would have done, instead they retreated back to the tribal areas in Pakistan and are biding their time. This is just like the days of Vietnam with Laos out of bounds.
You want to get bin Laden? Send a million men and conquer and dismantle Pakistan.
Which is totally out of the question until one of our cities is nuked. Then we truly go berserk.
The biggest problem is the folks living over there in mud huts think that outlasting us is easy. They should have taken Vietnam would have fallen to the north before 1970, and millions would have lived.
We are the 900 pound gorillas of the western world- for now. Consider the fact we have been at war for over 8 years, and have nearly 10% unemployment!!! Where is the screaming inflation and tight labor markets of total war?
Someday this war's gonna end...
Bob Dobbs wrote:
It's worse than that. If you're a really addicted geek, as they all are in the higher levels, you can't get away from thinking about it. My husband and I have both gone into "mentat" mode where we write software in our heads while pretending to do something else. You think about it in the shower, at the grocery store, all the time. it's an obsession. That's one reason I got out.
Nuke wrote:
Well, I'll drink to that, but that's mainly for you operational guys; most white collar and R&D types don't have the option.
But I do fondly remember working swing shift years ago. Loved it: do your job, go home and sleep, then a block of 7-8 hours free time while you're fresh.
Outsider wrote:
Or giving some of them back and eating the remainder
Bob:
You know what's weird? We have lots of trouble recruiting people for ops. Most folks would prefer to work a 9-5 job in R&D or something than work shiftwork. Personally, I don't get it. I never get called in on my days off. And if they try, you just throw the safety aspect at them: So, after working 7 days on mids, you want me to come in on one of two days off before switching to days? Sure, and when something goes wrong I'll let the regulators know I was sleep deprived due to some bullshit paperchase. That shuts them up quick.
EvilHenryPaulson wrote:
That is where the problem actually started. Westerwelle, who is to the right, started spouting off as if he were still on the campaign trail. His statements were initially often interpreted as the coalition's views. These FDP views though are representative of a relatively small percentage of Germans and therefore lead to constant clarifications and position statements by the CDU where they disagreed with Westerwelle's take. Not a good way to govern.
She now has to take the lead, no choice in the matter. She had a much easier time with the prior partners, the SPD though the present government was initially termed the Wunschkoalition.
(keep in mind that everything is <70yr lease, not ownership as westerners think of it. and Shanghai is a large city in terms of size when considering an average price)
Nuke wrote:
opportunity for advancement is one big factor in choosing a job
Rajesh wrote:
There may be some real economies. RRE is built much less expensively than office CRE. Not to mention the ludicrous amount of wasted expense on commuting.
This is nothing new in SoCal at least. At a place where I worked in the 1990s, there were people who had to miss work on snow days when the roads were closed. In SoCal. Why? Because they commuted to work from places 100 miles away where there is actually snow in the winter.
At another site, many people regularly commuted 60 miles (one way) to the office. Why? Because they couldn't afford to live in the city. And this was before the last RRE boom.
I am thankful every day that my commute is 20 yards door-to-door, and I can still do business with people in other countries as well as the local metro area.
S&P futures down half percent. When to jump back in on shorts is the question. After earnings season? In June when the census jobs go away? (Though I'm sure the census jobs will not be considered when they add to the monthly totals, they will be duly noted when they are impacting the jobs picture negatively).
EHP:
True, you get lots more facetime with management on daystaff. However, I have found your bargaining power is better in ops. No one wants rotating shiftwork, so when they find someone who like it they want to hold on to them. Also, you have more freedom; you do your job and go home. No BS meetings, no getting called in, no 2 am conference calls at home with God knows who.
Nuke wrote:
What job you like depends on who you are. For example: I am terrible at "going to work" from 9-5. If I don't sink my teeth into a problem, it is difficult to get out of bed in the morning. And when I have sunk my teeth into a problem, it's hard to pay attention to much else.
In short, I hate working for a living. Doing things I love is what gets me out of bed.
In short, I hate working for a living. Doing things I love is what gets me out of bed.
10-20% of the population is now living your dream.
memmel wrote:
Bingo! Resource limitations take supply out of the picture. It will all be about demand.
Nuke
I would agree with you. I think everyone wants to avoid becoming an commodified expendable cog in the machine, but sometimes that means doing the opposite of everyone else.
Shanghai RE is hot hot hot
$500 for 68 sq ft one bedroom -- it's not so bad, you could talk them down to $450/mth with negotiation
Shanghai Apartments for Rent | AsiaXPAT.com
or how about $2200/mth for 1200 sq ft
http://cityspace.shanghaiexpat.com/
this in a country where people have grown up, and in most cases still do, get housing provided by the government
dr munch wrote:
SDS is always worth looking at.
Why does the oil prices and vehicle miles chart show that the recession "was" over in 2009?
House is now debating (live) the heatlh care bill. As if anyone would need a link, but CNN.com Live
(I think that should work)
SDS huh? Sorry, but I have been a disciplined investor of late. I only lose money in single shorts nowadays.
Outsider wrote:
I don't have the stomach to watch sausage being made, but thanks anyway
sm_landlord wrote:
I had no idea what they were making but it looks and smells gross.
What ever you do, work for a living own a business, enjoy it. All have their advantages and dis advantages.
Citizen AllenM
as usual you make excellent points....and well
but still i disagree, realizing you may likely be right
but
seems to me that if there is a lesson from the shaw, and saddam and all the other full fledged tyrants of the world
its that given the right combination of brutality, a police state, and incentives, it may be possible to nail down afghanistan
in order to trans-ship oil from the "stans"
im not in favor of any of this
but
i believe thats the thinking of our so called leadership
its always been about oil , ie cheap energy,(and i know we are not arguing about this)
going back to before WW2...thats why the brits and us blocked the japanese in the 1930s from indonesia
and thats why the bushies did all that sabre rattling about venezuella and their populist dictator
its never been about justice and freedom...our history shows we would glady back satan himself
if he gave us what we wanted in exchange
at least you and i can agree that the odds are not good that afghanistan gets brought under control
just you put the chances near zero ? and i think the chances are a little less than even money
2 hrs until the Big Vote . . .
Frank Partnoy on Off-Balance Sheet Transactions (MMBM) on Vimeo
MT,
That is why from my view we will never have green energy as oil is black gold wrapped into oil dollars. The major base of the world reserve money, the dollar.
Mock the stans are a distraction to keep the bear busy while oil from Iraq comes online again and gives us cheap crude.
The only reason why we are still in Afghanistan is bin Laden.
When he is killed (most likely in Pakistan) we will be gone like the wind.
Which is exactly why we will never have much real influence there- they know we are simply short term invaders with a short term mission.
Iraq really pisses off the Iranians, because the slug of crude coming on the markets will drop the prices, and leave Iran and Venezuela in the grip of their next revolution. Large masses of young people do not make for a stable regime, now do they? Look at all those Iranian kids out protesting! Sure don't see it here, just a bunch of old white teabaggers blathering harmlessly.
Revolutions are for the young, devolutions are for the old.
When Iraq gets that next 2-4 million barrels per day onto world markets, and uses the money to buy peace, well, that is just not what the Iranians can deal with, especially if it results in $40 oil.
The saudis are content with prices this high, but are nervous they are too high and too profitable to folks they want hungry.
In general, we have some agreement, but I think the looking for remote geopolitical influence is moot in Central Asia- energy is available much closer, and much cheaper. If we wanted real energy independence we would go natty gas.
Someday this war's gonna end...
"The Kashagan oil field in northwest Kazhakstan, as well as the recently discovered, amazingly large (4-14 trillion cubic meters) Yoloten-Osman natural gas field in southeast Turkmenistan...
As I understand it, both countries are now within the Russian sphere of influence.
adornosghost wrote:
That is conventional oil production.
Stephen Byers claims no rules were broken during lobbying sting |
Politics |
guardian.co.uk
longwaver wrote:
Oil is negligible in electricity generation so there is essentially no relationship between AC/electricity demand and oil consumption, and there has been a continuing trend of reducing reliance on heating oil for winter space heating requirements (predominantly in the northeast IIRC).
Most current stats on home heating oil from EIA (think I got the right series):
U.S. Total Distillate Adj Sales/Deliveries to Residential Consumers (Thousand Gallons)
a group of Labour MPs were targeted in an elaborate sting operation in which journalists set up a bogus lobbying company and offered to pay them in return for political influence.
A remarkably humane system, is it not? There are some countries in which cabs for hire would be holed through their bonnets.
Citizen AllenM wrote:
Bigoil, at least where I live in that world, does not believe in the sustainability of the current futures price curve for oil.
energyecon, since you're on:
I recently read that the Saudis are now injecting carbon dioxide to keep Ghawar producing. And that that's pretty much the last thing you do when production is falling. Does that sound like reality to you?
LBD
never?...never is a long time
i think we will have renewable, and green, and alternative etc energy
but its gonna be slow at first
btw
if the american people ever woke up from their long dream
and factored in the cost of wars and military empire and naval patrol to keep shipping (tankers) lanes safe... added in to the cost of oil
they might (might) realize that the cost of oil is way above 150$ per barrel
they might (might) realize that the cost of oil is way above 150$ per barrel
Just keep saying "Al Gore". A comforting incantation.
"it appear that miles driven responds to spikes in oil prices."
Hoocoodanode?
One might also surmise that turbulence in oil prices, is indicative of a recessionary period...
Werner the Wolf Eel wrote:
Nigeria is playing a good game at that all the same, but there is a larger point in your LNG carrier stat. We are about to see a 50% build out of the LNG fleet and none of those are spec builds, they are built for particular LNG trains (LNG projects). So there is always a tanker loading, one on the way, one offloading, one on the way back...that is speaking to a coming wave of LNG supply that will be looking for a home from a great big capital investment looking for some return. For some projects, the sales gas is almost a disposal problem as the primary driver of project economics is the liquids production from the gas stream and for the rest, the most likely path of loss minimization is continued production...there is a lot of LNG coming to market in the next 2-3 years.
I should have not used the term never. In the foreseeable future we will not make a real change in policy about oil. We real cost were injected into the price of anything (debt) they would be surprising. Extend and pretend is catching up fast. This is from a article n past Der Speigel.
"The oil business is the foundation of the dollar's hegemony. The oil-producing states do some $2.2 trillion dollars' worth of business each year in the US currency. Larry Summers, Obama's top economic adviser, once compared the dollar to the English language in terms of its importance to international trade."
Chimerica's Monetary Management: China Has a Plan, America Doesn't - SPIEGEL ONLINE - News - International
mock turtle wrote:
There sure are a lot of free riders on that train...
citizen allenM
again you make good points , and i agree with several, about the young and revolutions etc
but afghanistan is not only about bin laden...and not even all about trans-shipping oil
nuclear pakistan... and india... are also a major consideration
as for pissin off the iranians...sure, some, but overall we are pissin into the wind
cause the price of crude is goin nowhere but up up up so long as asia grows and is stable...unless
unless there is world wide economic armageddon
and yes, we can certainly put some drag on the inexorable rise in crude with an iraq that is friendly and in full production mode
but how long does it take for that solution to play out
the entire world is no longer americas toy
other players are coming to the fore
dr munch wrote:
I don't care who you are, that's funny!
mock turtle wrote:
China is admitting that they will run a trade deficit in the month of March. Their loosening of currency controls combined with the dollar peg limits their ability to run an independent monetary policy. If Germany and Greece are not an optimal currency area, what about the U.S. and China?
off topic but interesting if you like amphetamines and speed
Junk Bonds Selling at Briskest Pace Since 2007: Credit Markets - Bloomberg.com
Hmmm wonder why Junk Bonds Selling at such a Brisk Pace
km4:
Chasing yield. A 12 month CD only yields about 1.5%. Grandma needs to put her money somewhere. The Fed's have made rational investing impossible, so the casino is open for business.
km4 wrote:
I tend to wonder why Junk Bonds are buying at such a brisk pace.
km4 wrote:
And >80$ oil about to put the brakes on recovery?
OT, but ZH has a thread inviting commenters to cite their anecdotal economic experiences & impressions. Fascinating reading, really.
Open Thread: The Real State Of The Economy | zero hedge
sm_landlord wrote:
Carbon dioxide injection is an EOR (Enhanced Oil Recovery) activity to mobilize additional oil in a reservoir after the primary drive mechanisms have been exhausted. Not every reservoir is suitable for a miscible CO2 flood which is what mobilizes the most oil...do you have a link to the info?
Here is some descriptive info from the EIA:
http://www.netl.doe.gov/technologies/oil-gas/publications/eordrawings/Color/colmr.pdf
here's a good read:
Battle of the Youth Bulge
"The U.S. Court of Appeals in Manhattan ruled today that the Fed must release records of the unprecedented $2 trillion U.S. loan program launched primarily after the 2008 collapse of Lehman Brothers Holdings Inc. The ruling upholds a decision of a lower-court judge, who in August ordered that the information be released. "
Oooh. that's gonna smart... Woe to the institutions making "profits" on mark to maturity...
energyecon wrote:
ISTR it was a paid newsletter so no link. If I can find it again I'll try to email you a copy.
sm_landlord wrote:
Cool, thanks - share what you feel you can - when Ghawar tips over (ala Cantarell, which underwent nitrogen injection - I've heard statements that "destroyed the reservoir") that is game, set and match.
Here's one for broward (Google meme plot of "China bubble")
http://3.bp.blogspot.com/_s2bnSw8BazM/S6JDuxejnUI/AAAAAAAAAdo/X4OGlMXA46w/s1600-h/China+Bubble+Google+Trends+Mar.+2010.GIF
here
The Economics of Oil Empire and Peak Oil: The Great China Crash 2010-????.
Be a damned sight cheaper to start riding a bike!
YouTube - Johnny Guitar Watson - A Real Mother For Ya
This has gotta be a re-post, but it looks like there is "a lot of meat on the bone" in this post on the impacts of RMB revaluation by Michael Pettis
How will an RMB revaluation affect China, the US, and the world?
$80+ per barrel is possibly the price point where attenuated demand growth or destruction would happen again in the United States. But China is no longer simply some other factor, rather a large factor, soon to be the major factor surpassing the U.S. in influencing world oil prices. $80+ per barrel would only restrain demand in China but would not be nearly enough to reduce nearly annual double digit demand growth there. Vehicle miles is therefore something to watch in the U.S., but means less each day.
what does it tell you when India was not prepared to enter into an agreement with Iran for gas that was to be shipped across Pakistan. Anybody who thinks that an oil pipeline from Central Asia to the Arabian Sea is going to make sense even with the American military protecting is living on some other planet.
We are on a plateau, and the edge to go over is coming in the near future. "
Peak Oil rears its ugly wellhead, or lack of one.
My flight back from Bangkok was luckily in biz class and I engaged in a conversation
with an American oil driller in Borneo. He wasn't buying any of my peak oil argument.
Said there's more oil but it all depends on price point per barrel.
....
for all that missed the vid I posted the other night that was sent by an artist friend
in Italy here's the link: YouTube - UN DOMINO MAI VISTO - OK GO - THIS TOO SHALL PASS(VIDEO UFFICIALE
it's essentially a hyper Rube Goldberg performance machine with music,,,
it's brilliant !!!
longwaver wrote:
Its bigger impact is on the demand for office space. I have posted about this before- I think this is the Sword of Damocles that is hanging over the Office space market. That change when it happens will not only effect the new demand that would historically have been created from a recovering economy but will also impact those currently employed. The proverbial tipping point.
crazyv wrote:
India wants more money and/or other considerations before agreeing to the deal.
“I can understand that some countries want to increase their share of exports,” Mr. Wen said, in an apparent reference to the Obama administration’s goal. “What I don’t understand is the practice of depreciating one’s own currency and attempting to press other countries to appreciate their own currencies solely for the purpose of increasing one’s own exports,” he added. “This kind of practice I think is a kind of trade protectionism.”
- Premier Wen
Wen is absolutely right and I'd say a slam dunk on Pres.
This is not community organizing 
Citizen AllenM wrote:
A million - you have to be kidding- think in terms of multiples of 5MM. However, it might be easier to dismantle Pakistan than conquer it. Interesting country Pakistan - its national language is not the mother tongue of any of its constituent parts. The NWFP even voted against the Muslim league in pre partition India. The other provinces all have secession movements of one kind or the other and bristle against the domination of the Punjabi controlled army and elites.
Meanwhile the expensive health care bill is going to get passed. I'm surprised that with the US commiting to a trillion dollars it seems not to be a big deal. The money for that will start having to flow at the same time the states, pension funds, and CRE bills start coming due. Forget the right/wrong stuff. It seems like this a big deal or am I missing something? This cost of this, at least to me, is the same as running a war on yet another front.
By Daniel Kruger and Bryan Keogh
March 22 (Bloomberg) -- The bond market is saying that it’s safer to lend to Warren Buffett than Barack Obama.
Two-year notes sold by the billionaire’s Berkshire Hathaway Inc. in February yield 3.5 basis points less than Treasuries of similar maturity, according to data compiled by Bloomberg. Procter & Gamble Co., Johnson & Johnson and Lowe’s Cos. debt also traded at lower yields in recent weeks, a situation former Lehman Brothers Holdings Inc. chief fixed-income strategist Jack Malvey calls an “exceedingly rare” event in the history of the bond market.
The $2.59 trillion of Treasury Department sales since the start of 2009 have created a glut as the budget deficit swelled to a post-World War II-record 10 percent of the economy and raised concerns whether the U.S. deserves its AAA credit rating. The increased borrowing may also undermine the first-quarter rally in Treasuries as the economy improves.
km4 wrote:
Currency manipulation begets currency manipulation! Wen ought to depeg the yuan and let it float, taking air out of O.
Duke of Con Dao wrote:
Just goes to show he doesn't understand the concept of peak oil. Too many petro engineers think only about reserves and extraction technology and not enough about realistic production capacity. There's plenty of oil still out there, there's just no way we can get it out fast enough to even sustain (let alone expand) current production levels.
traderwalt wrote:
nope- it is quite a simple calculation. What end user wants the risk that their supply could be cut anywhere along the the thousand miles. The Indians would prefer to build an under sea pipeline that by passes Pakistan completely. There was even thought about extending the pipeline into China to eliminate the political risk of the Pakistan government cutting the supply but that does nothing to address to fact that the pipeline would have to go through areas that are only nominally under control of the Pakistan Government.
Gus Satkowski wrote:
Not sure about that just that simply its one factor. And I actually watch like a hawk its one of the few data points closely related to oil that seems fairly clean of political influence. Or put it this VMT data is used for so many other highly political issues aka roads etc that its politically charged to the point of actually being reliable. Its a complex problem with a lot of factors involved just as crazy as the economic issues discussed on this blog. One important factor is the disconnect between VMT and products supplied and refinery utilization. Now there is a very interesting little tidbit. When America starts driving more and more using less oil then you can be sure something sinister is afoot. Or believe everything you read.
TJ and The Bear wrote:
Economists own a slightly different face of that mode of thought - all that aggregate demand at $140/bbl was just going to suck it right out of the ground; it was just a matter of opening a spigot.
I have noticed that non-peak (rush hour) traffic around here is close to what it was when gas was at its highest point. I'm not sure why. Rush hour is even heavier on the other hand.
Duke of Con Dao wrote:
Funny you mention that I was talking to a realtor today and they told me right now was the best time to buy or sell depending on the price point. Not that you don't find people with a clear view of their business but a random sampling of any business is probably not going to give you anything but the party line.
It is difficult to get a man to understand something when his job depends on not understanding it.
Upton Sinclair
crazyv wrote:
Oops, I had my geography "backwards". My bad...
Duke of Con Dao wrote:
That's wicked. I totally approve.
Duke of Con Dao wrote:
Kinda like real estate agents who didn't think there was a housing bubble.
However, it might be easier to dismantle Pakistan than conquer it.
Who's going to do it? Who gets the nukes?
However, while we're at it, why not invade and occupy China? That'll teach them to low ball their currency. When that's finished with, we can establish a Levittown of the Moon. Every cat and dog with its own space suit, and a sub-lunar Walmart for every township.
Easy. Then we'll pass a law against flatulence. And then...
pavel.chichikov wrote:
...It never ends.
Hubby made it home from his weekend of fun. He made it home from work last night at 1:30AM. Went back in at 7am this morning and got off at 6:30 this evening. They are going to pay anyone that worked the weekend for 40 hours for those two days on top of their regular time. They catered in food for the two days as well. They also gave "cash prizes" to those that worked above and beyond the call. Hubby was one of the "winners". I'm so happy he is safe and proud of his work ethic. I truly doubt I could have done what he did this weekend.
LOS ANGELES -- The ex-president of California's largest provider of workers' compensation earned more than $1.6 million in her two years on the job, according to a published report Sunday.
Janet Frank, 58, was hired in 2007 to oversee State Fund after its president was ousted in a scandal. The organization is part government-run but financed by private business.
Frank was awarded an annual salary of $450,000 plus a slew of other incentives including a signing bonus of nearly $140,000 to help her move from Colorado. She never moved to California and instead commuted from her Denver-area home - a commute that was partly offset by a $99,000 annual stipend.
Former Calif state fund president earned $1.6M - Sacramento News - Local and Breaking Sacramento News | Sacramento Bee
nova wrote:
I agree with you. I was surprised Obama focused on this issue above all others, and also surprised at the compromises he made along the way. The timing seemed wrong to me. I am completely numb to government spending numbers at this point. It could cost $100 trillion and it wouldn't mean anything to me. Hopefully, it will work better than HAMP.
Comrade Kristina wrote:
Very cool, after all you guys have been through it's nice to get a bonus.
Duke of Con Dao shared a conversation...
"My flight back from Bangkok was luckily in biz class and I engaged in a conversation
with an American oil driller in Borneo. He wasn't buying any of my peak oil argument.
Said there's more oil but it all depends on price point per barrel."
where is the disagreement
we are probably at or near peak oil
AND
we will never run out of oil...there will always be some...for the right price
and most of that as the flood slows to a trickle
and i think (guess) at that point
most of the remaining supply will be used for synthetics, fertilizers etc and rarely for fuel
maybe LFC the sludge
edit, a process that gets liquid petrochems from coal or near coal
Yeah, he's pretty happy although at this point he's slap happy he's so tired. I bought him some new work boots and a six pack of Tsing Tao today so he's a happy camper right now. He said they fed them really well all weeked with sub sandwiches and BBQ. The actual owner was on site all weekend as well.
I'm starting to appreciate the impact of the Triffin dilemma. Might come in handy over the next few years as I expect that the U.S. will attempt to play the other side for a few painful years:
Global imbalances and the Triffin dilemma | Analysis & Opinion | Reuters
...
THE TRIFFIN DILEMMA
This paradox linked to the provision of the world’s reserve currency was first noted by Yale economist Robert Triffin. In a famous warning to Congress in 1960, Triffin explained that as the marginal supplier of the world’s reserve currency the United States had no choice but to run persistent current account deficits.
As the global economy expanded, demand for reserve assets increased. These could only be supplied to foreigners by America running a current account deficit and issuing dollar-denominated obligations to fund it. If the United States stopped running balance of payments deficits and supplying reserves, the resulting shortage of liquidity would pull the global economy into a contractionary spiral.
But Triffin warned that if the deficits continued, excess global liquidity risked fueling inflation. Worse still the build up in dollar-denominated liabilities might cause foreigners to doubt whether the United States could maintain gold convertibility or might be forced to devalue.
Triffin was writing in a world of fixed exchange rates, but his work provides a useful way of thinking about the current crisis. In the 1950s, the fear was convertibility of greenbacks into gold. Today, the fear is dollar devaluation, inflationary default on Treasury bonds, or capital losses on securitized products linked to widespread insolvencies.
Triffin’s work suggests that the Fed did have a choice in the late 1990s and early 2000s, albeit an unpalatable one. Officials could have refused to supply the incipient demand for liquidity. Higher interest rates could have prevented the (worldwide) borrowing boom and widespread deterioration of financial standards seen in recent years. But they would also have meant lower growth in the United States and the rest of the world. ...