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Guest Post: The New Abnormal

Tyler Durden's picture




 

Submitted by James Howard Kunstler of Kunstler.com,

The collective state of mind in the USA these days may be even more peculiar than what went on in Germany in the early 1930s, when the Nazis were freely elected to lead the country and reconstructed the battered national psyche into a superman cult that soon beat a path to mass death and ruin. America has its own way of going crazy. We don't goose-step to tragedy; we coalesce into an insane clown posse and stumble into it by pratfall -- juggaloes dancing backwards off the cliff edge. 

We've been softened up and made extra-stupid on a 60-year-long diet of TV and kreme-filled donuts.  Instead of a "master race," our political fantasies revolve around a master wish - to get something for nothing. Want to feel good about yourself? Smoke some crank. Want to become economically secure? Buy a Powerball ticket or drive to the local casino. Want political esteem? Plug a flag pin into your lapel. Want status? Borrow free money from the Federal Reserve at zero interest and arbitrage it into massive earnings for your primary dealer bank. All these behaviors are the consequence of a culture that elevated advertising to such a high social good, it ended up drowning in its own manufactured bullshit.
 
Atlantic cover.png
 
A subset of our master wish has been on vivid display in recent months, namely the idea that God has blessed the USA with a limitless supply of new oil that will allow us to keep driving to WalMart forever. This propaganda from an oil industry desperate for capital investment has been swallowed whole by people in authority who ought to know better, just as that same class of people in Germany of 1934 should have known better about what they were bargaining for in economic well-being with the Nazi agenda. In our case, the propaganda drumbeat is being led by formerly respectable news organizations. The New York Times, National Public Radio, Bloomberg News, Forbes, and The Atlantic Magazine are media giants that have lately spread the "good news" that America will soon be 1) "energy independent," 2) the world's leading oil exporter (greater than Saudi Arabia is now!), and the "go-to nation" for cheap manufacturing.
All of these claims are false, by the way. The American way-of-life was designed to run on $20-a-barrel oil, not $90-a-barrel oil, and "new technology" has not changed that. The unfortunate and, to some extent, mendacious memes about the wonders of "new technology" have only snookered the public into a false sense of security about a future that will disappoint them badly and probably provoke an extreme political reaction as the reality of our predicament sweeps through daily life.
Most of the current "endless oil" fantasy revolves around shale oil. Just to get a visual idea of what this amounts to, consider this map. It depicts the two major shale oil production regions of the USA: the Bakken in North Dakota and the Eagle Ford "play" in Texas. Bakken production is confined almost entirely to four counties in North Dakota (Williams, Mountrail, McKenzie, Dunn). The Eagle Ford region touches perhaps ten Texas counties. Now, realize that the oil fields all over the rest of the USA (including Alaska) are in decline. Here's where the "bonanza" of new oil all comes from:
 
Shale.jpg
The oil coming out of these places is high cost and low flow-rate oil. This is exactly the opposite of what US oil production used to be (low cost and high flow-rate) when we were busy building all the freeways, strip malls, housing subdivisions, suburban office parks and all of the other stranded assets that now make up the infrastructure of daily life in this country. Those were the days when you could pound a single pipe vertically 1000 feet down (not much deeper than many home water wells) into the temperate wheatfields of Oklahoma (drive to work in shirtsleeve weather!) and after that modest investment in drilling you could kick back and depend on a great flow rate (5,000 barrels-a-day, not unusual) of sweet light petroleum for years.
Horizontal drilling (often more than 10,000 feet down + many "laterals" an additional 10,000 feet horizontally) and then fracturing "tight" rock for shale oil is not only a way larger capital expense (lots of steel!) but the flow rates per well (82 barrels-a-day average) are laughable compared to the halcyon days of conventional oil -- little better than "stripper" wells. Consider also that shale oil well flow-rates decline greater than 60 percent in the first year (rapidly thereafter, too) and you can see easily that there will be no "kicking back" to run the pump-jacks like cash registers, as in the old days. In fact, the rapid depletion only prompts more frantic drilling and re-drilling to keep the production at its current rate - the "Red Queen Syndrome" ("I'm running as fast as I can to stay where I am"), which means fantastic capital expenditure to keep drilling and fracking more wells (even more steel!). Consider also, that the small "sweet spots" in the shale oil regions were the ones drilled first (in earnest after 2003), for the simple reason that they were the most promising. This was the "low hanging fruit" -- easy to pick. Outside these sweet spots the oil may be too meager or difficult or costly to bother drilling for.
This is a picture of a boomlet that may run a few more years -- if the banking system doesn't implode and the massive stream of capital doesn't quit flowing to the shale counties. The excitement will all be over before 2020, but I suspect that troubles in finance and banking will put the schnitz on the shale gas mania long before that date. What will happen when the American public discovers that they were lied to about yet another important matter? The discovery will coincide with very severe changes in daily life that won't be avoidable. Everyone will be affected. Many will be impoverished and suffer real hardship. That's when the public goes apeshit and starts tearing down the house.
Apart from the issue of sheer economic suffering and all the damage that will ensue, consider that it will be generations before anyone believes the "authorities" again -- though, like the oil age itself, the era of giant national media will probably prove to be a one-shot deal, too. Future generations -- if they are lucky -- may read the news on one-page circulating broadsides, printed laboriously in hand-set type by letterpress. Or maybe they'll be reduced to just parsing out rumors.
 
 

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Mon, 05/20/2013 - 12:54 | 3580758 Osmium
Osmium's picture

It is true.  We will never "run out" of oil.  There will always be oil underground that is not recoverable.

Mon, 05/20/2013 - 13:12 | 3580782 knukles
knukles's picture

Must be true... otherwise they wouldn't print it.

Plus, it did come from meteorites along with gold and water.
So du-uh on you nonbelievers!

And them dinosaurs created global warming, too, bitchez

Mon, 05/20/2013 - 13:19 | 3580860 ZerOhead
ZerOhead's picture

I predict the final "Oil Boom" will come from recycling the asphalt from the interstate highways we don't use anymore.

Can't fly Lord Bankfine's private jet on battery power you know...

Mon, 05/20/2013 - 14:57 | 3581245 whotookmyalias
whotookmyalias's picture

Oil is boring. We need real panic.

Mon, 05/20/2013 - 15:09 | 3581312 DaveyJones
DaveyJones's picture

nice

Mon, 05/20/2013 - 14:29 | 3581140 RafterManFMJ
RafterManFMJ's picture

Deep acoustic imaging shows Mars is chock full of Hydrocarbons, and the Mars-to-Earth interplanetary pipeline is under construction as we speak. All is well.

Mon, 05/20/2013 - 16:53 | 3581696 Diogenes
Diogenes's picture

Space oil!

Mon, 05/20/2013 - 12:57 | 3580770 auntiesocial
auntiesocial's picture

nice post. only thing missing is the Orange Faygo reference.

Mon, 05/20/2013 - 13:04 | 3580794 Dingusdongus
Dingusdongus's picture

I wouldn't worry. God is hardly likely to let the USA run out of oil.

Mon, 05/20/2013 - 15:10 | 3581316 DaveyJones
DaveyJones's picture

yes, but the Devil is in the details

Mon, 05/20/2013 - 13:10 | 3580799 upWising
upWising's picture

DRINK alcohol.  (If a little is good, a lot is better, and too much is better YET!)
WATCH more television.  (If it's on TV, you know it is true.  That's what TeeVee is for!)
TAKE your medication as directed.  (If He wears a White Coat, he knows what is he is talking about).
SHOP as directed.  (If a little is good, a lot is better, and too much is better YET!)
DRIVE wherever you go.  (Why walk to the end of the driveway when you can drive?)
SUPPORT AND BELIEVE your preacher. (If he is a Rev. and has a shiny suit, he is telling the truth. Give generously!)
DISPLAY the Flag.  (Lapel pins, bumper stickers, flying in tandem from the back of your pickup).
ADJUST your BarcaLounger.  (You have a Constituional Right to Chillax and be Comfortable). 

DO ALL OF THIS AND KNOW....

You are Defending The Homeland.

U-S-A-Number 1!

Mon, 05/20/2013 - 13:15 | 3580844 knukles
knukles's picture

LOL

The Mae West Theory of Bountifulness 

If some is good and
 More is better
  Then way the fuck too much is just about right

Mon, 05/20/2013 - 14:12 | 3581084 WillyGroper
WillyGroper's picture

Goodness had nothin to do with it.

Mon, 05/20/2013 - 14:01 | 3581045 Cleve Meater
Cleve Meater's picture

Very funny... Only thing missing is EAT lots of phony Frankenfood so you can get your Medicare subsidy for your electric go cart.

In all seriousness, has anyone out there considered just moving abroad? At some point, I think we'll see an exodus. If the craziness continues, it has to happen. These two dudes did it with families. Interesting idea: http://movingabroadwithchildren.com/five-things-everyone-should-know-bef...

Mon, 05/20/2013 - 13:04 | 3580802 InTheLandOfTheBlind
InTheLandOfTheBlind's picture

Abiotic bitchez!

Mon, 05/20/2013 - 13:05 | 3580803 InTheLandOfTheBlind
InTheLandOfTheBlind's picture

not to mention the gasification of coal

Mon, 05/20/2013 - 13:10 | 3580816 knukles
knukles's picture

or gasification of chili

Mon, 05/20/2013 - 13:13 | 3580840 insanelysane
insanelysane's picture

I hear there is oil on the moon but building the pipeline is going to be a bitch.  Damn thing keeps moving.

Mon, 05/20/2013 - 13:18 | 3580862 This just in
This just in's picture

THe gassification of my man cave.

Mon, 05/20/2013 - 13:08 | 3580812 the Absurd
the Absurd's picture

To actually understand the end of cheap oil, one must acknowledge that many things that are unthinkable become only a matter of time.

Most people don't want to understand that, and that's understandable.  If Obama came out and addressed the nation about peak oil, anarchy would break out world-wide.  They really can't admit it at this point on a large public scale.  Jimmy Carter kind of tried to explain exponential growth, but no one wanted to hear it.

There is the Hirsch Report, so I'm sure they know.

Could you imagine Chris Matthews or Bill O'Reilly all of the sudden sounding like Michael Ruppert?  They would probably be fired.  Whatever happened to Dylan Ratigan after his ranting that went viral?  The public can't handle the truth and largely don't want to hear it anyway.

Like Osmium says, we will never "run out of oil".  We'll just reach a point where it's not economically viable to recover what remains, and everything will shut down - from the just-in-time inventory system that keeps the store shelves stocked to the airlines.

Mon, 05/20/2013 - 14:02 | 3580949 ZerOhead
ZerOhead's picture

We'll just reach a point where it's not economically viable to recover what remains, and everything will shut down...

Never forget that oil... like water... always flows towards money. Both are huge input costs in modern agriculture which is perhaps the most important and productive industry left in the declining Western economies. You can't just shut this sucker down and not expect complete societal implosion.

Let's not forget that a single gallon of gas has the energy equivalent of around 500 hours of human labor so I see the price rising one hell of a lot higher before things begin to shut down. When you see horses pulling wagons in the streets again you will know for sure the end is near...

http://powershift.anetce.com/oil_humanenergy.htm

I see a lot of bicycles these days going up and down my street... and vehicles are just going to have to get smaller and more fuel efficient (or 2 wheeled). High fuel prices will eventually do that even without those carbon taxes the Gorists and Banker/Political classes want so desparately.

The prices will get crazy to be sure... but I don't expect production to collapse... people will just have to pay more money they already don't have for it...

Mon, 05/20/2013 - 14:25 | 3581059 the Absurd
the Absurd's picture

When it takes more energy to extract the oil than the oil can provide in whatever form, it's not economically viable to extract it.

If money is not backed by adequate energy, it quickly becomes worthless.

Humans will go back to using slave labor directly (for farming, not iPods).

In my view, industrial civilization is an anomaly in human history.

Mon, 05/20/2013 - 14:36 | 3581165 Citxmech
Citxmech's picture

Don't forget that "modern" farming is essentially "hydroponic" in that crops are fueled 100% by chemical fertilizers in what is basically a non-nutritious growth medium.  To grow crops without commercial fertilizers would take a realignment that would make a transition from cars to bikes look like a cake-walk (essentially, we need to eliminate mono-cultures, and incorporate crop-rotations that include grazing animals - a la "Polyface Farms").

As energy costs go up - irrigation is going to become a HUGE issue.  And then there are the issues with the declining aquifers, rivers, and lakes - and the new normal boom/bust weather patterns. . .   (basically, if cheap oil-based energy is a thing of the past - our food security will evaporate).

 

Mon, 05/20/2013 - 15:27 | 3581378 DaveyJones
DaveyJones's picture

the sick truth is that water capture and regeneration is relatively easy is we use permaculture principles. People like Geoff Lawton have demonstrated over and over again that swales on contour can easily rehydrate even a desert landscape. So does natural lanscape with organic cover that actually absorb and hold the water. These methods only take a few years to establish completely self sustaining systems. Permaculture systems work and are more productive because they mimic nature. Imagine that, actually using the systems that already function on this planet to diverisfy plants, nutrtion, water and production. It is so intrinsic and fundmanetal that no wonder the control criminals want to deny it as an option. Nothing to hold, deny, distribute, and profit from.  People ask if the permaculutre systems can produce enough to survive (which they can) but the right question to ask is if the current systems can continue. We have no choice but to abandon these extermely "temporary" and destructive methods and go back to want worked in perpetuity.

Mon, 05/20/2013 - 15:38 | 3581438 Citxmech
Citxmech's picture

"Nothing to hold, deny, distribute, and profit from."

This is precisely why global supply chain based "value-added" processors get protected at all costs - localization eliminates the potential for their obscene profits.

The transition to a high-cost energy future is going to have to grow from the roots up and will be fueled by necessity.  

Mon, 05/20/2013 - 15:53 | 3581493 ZerOhead
ZerOhead's picture

I am growing raspberries and blueberries in their natural environment DJ.

No irrigation, tilling, fertilization, herbicide, insecticide or fungicide application necessary.

Perhaps some bee hives in the next few years...

Mon, 05/20/2013 - 16:09 | 3581559 DaveyJones
DaveyJones's picture

you the man

check out the alpine strawberry. very small, taste literally like a fine wine. wont survive in the supermarket but it's easy to drive to your backyard. Every berry is a hit to the banker, the tanker and the monsanto wanker 

Mon, 05/20/2013 - 16:23 | 3581605 akak
akak's picture

Davey, you are absolutely correct about the alpine strawberries --- I grew them for several years (outside of their natural growing zone, until a hard winter killed them all), and their flavor and aroma are fabulous, FAR and away better than the giant, woody strawberries from the grocery store.

Even better are the wild beach strawberries (Fragaria chiloensis) of the Pacific Northwest coastal regions, which are WILD in the intensity of their aroma and flavor ---- even better than the alpine strawberries, I think --- but which sadly almost never produce berries in cultivation for some reason.  I pick them wild here in Alaska, and while they are rare, they are worth almost any amount of time and work to find and pick.

Mon, 05/20/2013 - 16:54 | 3581700 Citxmech
Citxmech's picture

Akak - any idea where to get seeds/starts for the wild beach strawberries?  We grow Alpines currently, but being in the PacNW - I'd love to give these a try!

FYI folks - if you only eat store-bought berries - you've got to try fresh-picked - it's like the difference between a shitty recording and a live concert.    And they last 10x as long too.

Mon, 05/20/2013 - 17:21 | 3581782 akak
akak's picture

Citxmech, I have seen beach strawberry plants for sale through various catalogs, Northwest Territorial springs to mind, but even they state right in their catalog that the plants are really only being sold as a ground cover, and that one should not expect the plants to produce any meaningful amount of berries.  Unless you can place them in EXACTLY their natural environment ---- oceanside sandy soil --- they will almost certainly not produce many, or any, berries for you.  I have tried for years to coax beach strawberries into production in my own yard, which is only one mile from the coast, and have only managed to get one measly handful out of the patch in one single year.  It is an ongoing source of mystery for many botanists just why they are so finicky.

Mon, 05/20/2013 - 17:51 | 3581857 TheFourthStooge-ing
TheFourthStooge-ing's picture

Citxmech, the American Beauties Native Plants website has info on them here:

http://www.abnativeplants.com/index.cfm?fuseaction=plants.plantdetail&pl...

On the left side of the page toward the bottom you can enter your zip code to see if there are any sources local to you.

Mon, 05/20/2013 - 17:58 | 3581889 akak
akak's picture

The inability to self-propagate and blob-up fruit of US 'american' beach strawberryism is very much something.

Mon, 05/20/2013 - 18:17 | 3581953 TheFourthStooge-ing
TheFourthStooge-ing's picture

akak said:

The inability to self-propagate and blob-up fruit of US 'american' beach strawberryism is very much something.

Alas, ala, 2.75 times alas, somehow sounds like Chinese citizenism strawsberryman poured by AnAnonymystical propagangelists to prevent US 'american' citizens from producing technique giving blobbing up of beach strawsberry fruit much the dangdang.

In Chinese citizenism economics, such production is equivalent to consumption. US 'american' citizen production is disacceptable because diminish demand for Chinese citizenism strawsberries enriched with lead and cadmium.

It is another leap in logics Chinese citizenism citizens are used to.

Mon, 05/20/2013 - 18:42 | 3582046 Miffed Microbio...
Miffed Microbiologist's picture

Well, I had thought I'd achieved strawberry nirvana when I had tried Fraises des Bois in France years ago ( I think they are the alpine strawberries of which you speak). These little rascals are packed with so much flavor, a handful can out do a ton of commercial berries in flavor.. We can only grow them in a window box, our summers are just too hot. I tried growing them on our porch once and was continuously fighting the birds and weather so I gave up. We have 6 breeding pairs of Orioles that visit us every year and always spend a few days whacking the window trying to get at the berries. The joys of living in the desert. I can't imagine anything better than a fraise.

Miffed;-)

Mon, 05/20/2013 - 17:04 | 3581738 thomcat00
thomcat00's picture

Localized, organic farming is already practiced successfuly on the small scale. Community gardens exist in many cities. Distribution will still be a huge hurdle.

Mon, 05/20/2013 - 15:36 | 3581425 Shigure
Shigure's picture

+1 And don't forget that food has to be transported from farms, processed and packaged and then on to the shops. Recently there was a report of trucks turning off their refridgeration units to save fuel.

Mon, 05/20/2013 - 15:50 | 3581481 Miffed Microbio...
Miffed Microbiologist's picture

You are correct. The Polyface model is the only one that is remotely sustainable. However, given the population of this country, I can't imagine how this can be implemented. Local farm production will have to be seriously considered. When I was a kid I remembered driving for miles in LA through vegetable farms. Now all that farmland is under miles of cement propping up an endless sea of tract homes. Just obscene.

Miffed;-)

Mon, 05/20/2013 - 17:12 | 3581760 WillyGroper
WillyGroper's picture

that was great!

Mon, 05/20/2013 - 13:52 | 3581019 pazmaker
pazmaker's picture

when will this happen?

Mon, 05/20/2013 - 14:18 | 3581099 the Absurd
the Absurd's picture

I have no idea when the next major crisis will be, although I suspect it will be in this decade. In many ways it's happening right now, just not everywhere and to the same degree in all places.

I think the next financial crisis, whether it starts in Japan, Europe, or the US, will be unstoppable and set off a chain reaction world-wide, as central banks and governments have lost most of their credibility with people who are paying attention.

Chris Martenson gives a good presentation without getting hysterical.

I also recommend reading Shadowstats Hyperinflation Special Report.  He expects "The Great Collapse" by 2015 and focuses more on the US and financial aspects of the situation.
Mon, 05/20/2013 - 19:13 | 3582175 SpiceMustFlow
SpiceMustFlow's picture

Martenson's strongest suit seems to be making good points without getting hysterical.

Either way would anyone disagree that while the current "green techs" blow balls currently, the only way to make them more viable would be spiked hydrocarbon prices? I'm no expert by any means, but improvements in alternative energy seem to be tied directly to rising traditional prices logically, in an environment where there might be rational business models out there in no need of subsidization. We might see a younger generation full of Ross Beatys.

Mon, 05/20/2013 - 14:37 | 3581171 mind_imminst
mind_imminst's picture

I interviewed Hirsch 3 years ago. He said in 2 to 5 years that oil production declines would begin to hamper the economy. Not yet, but still some time on his prediction. He said natural gas was just about meaningless in the whole scenario, because not much oil is used for power generation. However, natural gas DOES prouce electicity for the tiny but growing number of electric vehicles. http://addins.waow.com/blogs/weather/2010/02/hirsch-interview

Mon, 05/20/2013 - 15:41 | 3581448 Citxmech
Citxmech's picture

Looks to me like oil production cost are hampering the economy right now.  Look at fuel prices and the collapse in gasoline useage.  No real growth, no juice to keep the debt-based Ponzi going - hence the deflationary tendancy that is being held down by currency devaluation.

Mon, 05/20/2013 - 15:59 | 3581519 DaveyJones
DaveyJones's picture

Are you suggesting the economy is not "in the hamper?"

Are our transition rates as fast as the disruption?

Are our "leaders" being honest about this?

Are we being honest with ourselves?

Mon, 05/20/2013 - 13:08 | 3580813 Bastiat
Bastiat's picture

1st paragraph was poetry.

Mon, 05/20/2013 - 13:15 | 3580850 Seize Mars
Seize Mars's picture

Bah. Could have been straight from "Rolling Stone."

Mon, 05/20/2013 - 13:32 | 3580929 Bastiat
Bastiat's picture

Ok I use the word lightly.  But Kunstler is a good writer.  Lots of good writing in Rolling Stone too, content and style:  see Matt Taiibi.

Mon, 05/20/2013 - 13:39 | 3580966 aerojet
aerojet's picture

He writes fine, but he never seems to be able to correctly tie a phenomenon back to its correct cause.  He's all over the place with idiotic cause and effect scenarios that he tortures into supporting his twin hatred for suburbia and for oil. 

Mon, 05/20/2013 - 14:58 | 3581236 Bastiat
Bastiat's picture

Won't argue with that.  Oil is a big deal but yes he is prone to going off in the weeds at times.  Don't read him much anymore but used to look forward eagerly to his next rant back in the Clusterfuck Nation days.  Passion, outrage, and a sharp pen.

Mon, 05/20/2013 - 15:31 | 3581405 DaveyJones
DaveyJones's picture

and it is necessary and welcome to hear a writer "rage" about these issues. We need more of that.

Mon, 05/20/2013 - 17:32 | 3581805 Citxmech
Citxmech's picture

Kuntsler is to peak oil, what M. Pollen is to food security (See Omnivore's Dilemma) - he presents a very digestible package for folks who aren't going to read things like "Twilight in the Desert" or the Hirsch Rept. and extrapolate.

Mon, 05/20/2013 - 13:08 | 3580814 apberusdisvet
apberusdisvet's picture

When WTI hits $100, it will be the beginning of the end.   Clean out your bank account and start stacking (food and water, ammo).  Keep your gas tank at full.  Be prepared for the next false flag. It will be a humdinger.

Mon, 05/20/2013 - 13:23 | 3580885 Great Depressio...
Great Depression Trader's picture

Lol. You sound histrionic. I seriously hope you are joking
WTI can hit 150 a barrel and stay there for quite some time without any devastating effects on the economy. Would it cause a recession? Of course, but that would lead to Lower consumption and therefore lower prices yet again. Peak oil is a process not just an event

Mon, 05/20/2013 - 13:32 | 3580928 LawsofPhysics
LawsofPhysics's picture

Unfortunately, exponential equations are indeed a bitch.  welcome the robber barrons back with open arms and just be done with it.  Long sharecropping...

Mon, 05/20/2013 - 13:43 | 3580978 Great Depressio...
Great Depression Trader's picture

Things aren't extreme as they make them sound. The DOOMERS overshoot to the downside.

For example, the net and the digital marketplace is making the post offic obsolete. Yes there is pain for postal workers but by and large we use less resources all around. Less gasoline, paper, tires, stationary etc.

Soon urbanization will come in full swing. Kiss the sprawling suburb goodbye as population densities will increase.

Population increases are done for the developed world. In 40 years expect the developing nations to hit the same wall.

At some point human population will hit an equilibrium. And while everyone bitches and moans please understand that my family in Greece up until 18 years ago would take a dump in a festering outhouse with a Turkish toilet stall. Living standards have exploded globally.

Finally we have survived much worse just 70 years ago the planet practically butchered itself with 70 million dead in world war 2. It's been since then since two powerful nations have attacked each other. Give the human species some credit

Mon, 05/20/2013 - 14:37 | 3581169 ian807
ian807's picture

The species will survive just fine. Some of us. The problem is the combination of high price and the decay of interdependent supply chains that exist only because of cheap transporation fuel. Supply chain deterioration is neither linear, nor are effects entirely predictable. What happens when it's too expensive to ship large machine parts in quantity from Asia or Germany to working oil rigs in Antarctica and the Gulf of Mexico? Or computers? Or pipe? Or food? When the price of oil starts affecting the production of oil negatively, the downward spiral will be very sudden, and from the perspective of those alive now, permanent.

Mon, 05/20/2013 - 16:06 | 3581547 Citxmech
Citxmech's picture

"WTI can hit 150 a barrel and stay there for quite some time without any devastating effects on the economy."

Were you paying attention to what happened when the POO hit $147.00?  The friggen economy imploded - and it's not like it's actually recovered since.

Debt-based currency is designed to facilitate maximum (cancer-like) growth - and when the system's food gets cut-off, interest cannot be paid on the debt (and the banking sector starves).

That's exactly what happened.  And all the bullshit economists have propagated that the concept of economic "growth" can somehow supersede energetic inputs has basically been proven to be as viable as perpetual motion.

Mon, 05/20/2013 - 14:47 | 3581196 johny2
johny2's picture

I think we are doing just great. Imagine if we lived sustainably, it would mean we stayed up on the trees in the first place. Instead it is much more reassuring to see that we are consuming all the resources as quickly as we can. This means everything will be fine, because once we have got rid of the dirty oil, somebody will invent some new clean source of the energy so we can carry on. the future is bright!

Mon, 05/20/2013 - 16:07 | 3581554 Citxmech
Citxmech's picture

I sincerely hope you are kidding.

Mon, 05/20/2013 - 15:05 | 3581282 spine001
spine001's picture

"Unfortunately, exponential equations are indeed a bitch.  welcome the robber barrons back with open arms and just be done with it.  Long sharecropping.."

What do you mean with exponential equations?

I can only think of modeling this with complex sets of differential equations. These equations can not be solved using regular math, can only be modelled, since they show fractal behavior and infitine dependence on the initial conditions...

http://www.wolfram-media.com/products/nksipad.html

 

 

Until next time,

Engineer

Note: I understand that conditions can not be modelled after only a few seconds due to the divergence your equations experience, may be you are trying to say that consequences can not be predicted. If so you are exactly right, but not on the exponential equations part.

Mon, 05/20/2013 - 15:53 | 3581475 DaveyJones
DaveyJones's picture

The price is not going to "stay there for quite some time." No one  has a damn clue given all the dishonest variables just where and how fast these price changes are coming. But a few things are for certain. (1) Society, all of society, including the credit economy is built on the false premise of infinite cheap energy and with it, infinite growth. (2) We have never been at this point in human history where just about everything is connected or made from cheap crude and everyone is using it. (3) None of these substitutes come close to energy value. Not a surprise since they took millions of years to form (4) This point comes also at the point where the stuff is hitting universal and steady decline. (5) Our reactions to these facts have been a mix of denial, violence and stupidity, using much more energy to hide, fight or maintain current deteriorating systems than rebuilding new ones. Whatever these transitions will be, given the first five factors, they will come with signficant disruption to just about every human function.  

Mon, 05/20/2013 - 16:17 | 3581586 WhiteNight123129
WhiteNight123129's picture

When you over fish the ocean, the fishes get depleted, but at least if you stop over fishing oceans because your world population declines, fishes come back. With oil this does not happen, you burn oil but then it does not make babies. The oil civilization is relying on a system way more vicious and fragile than charcoal, for which we had shortages by the end of XVIII century. At least given a certain level of population decline trees grow back, not so with oil. Once the cheap oil in Saudi Arabia is burnt, it does not come back.

The alternatives are population reduction WITH renewables together, or it is collapse.

 

Mon, 05/20/2013 - 17:41 | 3581826 Citxmech
Citxmech's picture

Gave you an enthusiastic thumbs-up, but wanted to point out one nuance - over-fishing, just like habitat depletion, can reach levels where depleted populations may never recover in spite of there still being viable mating pairs.

In other words, you don't have to pull out the the last fish to cause an extinction - deplete the populations enough - and it may already be too late.  See "Extinction Threshold":  http://en.wikipedia.org/wiki/Extinction_threshold

We may be past the point already where the ocean food chain inevitably collapses.

 

Mon, 05/20/2013 - 15:36 | 3581422 WhiteNight123129
WhiteNight123129's picture

It is the same idiotic "oil for ever" which was shorting all solar companies the good and the bad all of them in the same bad. Fucking idiotic. Solar might not be enough, but with money printing and scarcity of oil and increase in efficiency rate while economies of scale on manufacturing, the shorts deserved to be guillotined and they have been guillotined by a good measure. Now we have to wait for the investment managers idiotic crowd to love the stock at 25 times earnings (we are far away on FSLR since the company will have 5 USD of earnigns and 12 USD of net cash per share) while the same crowd was bashing it at 4 times earnings.

 

Mon, 05/20/2013 - 13:12 | 3580833 Mad Mohel
Mad Mohel's picture

Time for Big Oil to tap the Beard; I hear it houses all kinds of miracles and wonders.

Mon, 05/20/2013 - 13:13 | 3580837 Smegley Wanxalot
Smegley Wanxalot's picture

we have enough to last my life out, so fuck this place after that.

Mon, 05/20/2013 - 15:35 | 3581419 hardcleareye
hardcleareye's picture

A profound example of how morally bankrupt our culture has become.

Mon, 05/20/2013 - 16:17 | 3581585 DaveyJones
DaveyJones's picture

moral bankruptcy is just like regular bankruptcy - there's an exception for college money

Mon, 05/20/2013 - 16:24 | 3581607 Citxmech
Citxmech's picture

"Treat the earth well. It was not given to you by your parents, it was loaned to you by your children. We do not inherit the Earth from our Ancestors, we borrow it from our Children."

~ Native American Proverb ~

Mon, 05/20/2013 - 13:15 | 3580841 SillySalesmanQu...
SillySalesmanQuestion's picture

It is true...we will never run out of FRN's. Fuck you very much Ben.

Mon, 05/20/2013 - 13:14 | 3580843 JR
JR's picture

“…the Nazis were freely elected to lead the country and reconstructed the battered national psyche into a superman cult that soon beat a path to mass death and ruin.” – James Howard Kunstler

This is not only spectacularly incorrect, it is the most obscene use of Zionist propaganda that has been used to date. It is okay to connect today’s events to what occurred in Germany in the 1930s; it is not okay to connect what did not happen in Germany in the 1930s. As a matter of fact it is the worst kind of symbolism at a time when truth is such as important commodity. This borders on defamation.

Here is exactly what happened in those German elections.

Tyranny was imposed upon the German people by the Treaty of Versailles - by the same people who are imposing it upon Americans.  Even then the German people did not elect Hitler; in 1932 they elected Paul von Hindenburg of the Independent Party.

Hitler lost the presidential election 60-40 to Hindenburg.

His appointment as chancellor came when his party had started fading in the polls, and had dropped from 37 to 31% in the 1932 elections. Hindenburg, under political pressure, appointed Hitler as Chancellor of Germany in January 1933.

Hitler succeeded Hindenburg as head of state when Hindenburg's death brought his term to a premature end in 1934. After the president's death Hitler abolished the office entirely to replace it with the new position of Führer und Reichskanzler ("Führer and Reich Chancellor"), and thus cemented his dictatorship.

And, "even with the full power of the state and media behind him in March 1933” he fell short of a majority (43%) and still needed a coalition partner to keep being in majority. That's when he had the luminous idea to ban all other parties.

Mon, 05/20/2013 - 13:18 | 3580859 Seize Mars
Seize Mars's picture

This is correct.

Mon, 05/20/2013 - 13:27 | 3580903 SpiceMustFlow
SpiceMustFlow's picture

Also author doesn't deign to mention idiocy of UK polish war guarantee and the fact that trains didn't start toward death camps til it was obvious to command that eastern front was fucked big time

Mon, 05/20/2013 - 13:29 | 3580913 SpiceMustFlow
SpiceMustFlow's picture

But I guess that wouldn't suit his angle

Mon, 05/20/2013 - 13:20 | 3580869 Inthemix96
Inthemix96's picture

Well played JR,

Thats the problem with the truth though isnt it?  Its applied as and when the PTB need it, and even then it can be distorted to mean whatever they want it to mean.

One day the REAL truth will out, what a day that will be when the veil is finally lifted.  Its amazing to me how good a resource the interwebs are that not more folk make use and find out for themselves just how badly we have all been lied to.

It is coming though, its growing, its getting stronger and at some point it will be unstopable, bring it on.

Mon, 05/20/2013 - 13:27 | 3580877 rustymason
rustymason's picture

I don't forget that the Left was murdering 10's of millions of innnocents next door in Eastern Europe at that time, and that they showed every intention of wiping out or enslaving all of Europe through their murderous ideology. If only our government had worked as hard to wipe out state communism here at home, those Bobos wouldn't be in charge right now.

Mon, 05/20/2013 - 14:18 | 3581092 Winston Smith 2009
Winston Smith 2009's picture

JR - Totally correct.  However, I don't see a "Zionist propaganda" connection in Kunstler's explanation.  Are you referring to a desire to incorrectly present all Germans from that era as willing Nazis?

"Hindenburg, under political pressure, appointed Hitler as Chancellor of Germany in January 1933."

And if what I've read in books and seen in documentaries is correct, that "polical pressure" came from German industrialists.

Mon, 05/20/2013 - 14:59 | 3581259 JR
JR's picture

Among the big questions: Who were the German industrialists, bankers and opinion controllers in the 1920s and early 1930s?

I cite for starters: 

GERMANY


1923: Out of 161 banks in Berlin 150 are Jewish-owned.

The International Jewish Banks in New York cause the German Reichsmark to crash,
bankrupting the country within weeks.
1924: Out of revenge for non-payment the International Jewish Bankers, the German currency (Reichsmark)
which is tied into the International Exchange rate, plunges into a dive. Within months, the Reichsmark is worthless.
Unable to feed their families or pay rents, millions of Germans are forced to sell all they own.
The altered exchange rates means that $1 US dollar is worth many TRILLIONS of Reichsmark.
For only a few dollars, Jewish-American Investors brought German Businesses, Industries, Homes, Lands, Art works
and Jewish Investors become incredibly rich
.
By the end of the year, the German government manages to create a new currency and the madness is halted.
Millions of Germans have lost everything they own and many tens of thousands have starved to death.
The Germans still do nothing against these speculators; just the opposite- many of the
Jews gain high political and respectable position in Germany Society.


An international boycott of German goods was undertaken, which was especially effective in some areas
since the retail trade in many countries was and is in Jewish hands to a considerable extent. --
Reference: J. Beaty, The Iron Curtain Over America, pp62 ff.Historische Tatsachen Nr. 10 pp18 ff.

Jewish influence and material wealth was so great during the time of the Weimar Republic
that some Germans referred to it as the "Judenrepublik" ( Jewish Republic ) although Jews comprised only
about 1% of its population. To mention only one small example, over 30% of the faculty of the University
of Berlin was Jewish in 1932. Reference: Walther,Geopolitik im Kartendild/Die Juden, Heidelberg 1940.
Contains maps and statistical diagrams on the history of the Jews in Germany.

http://www.newsnfo.co.uk/pages/germany.html

http://archive.org/details/TheIronCurtainOverAmerica

Mon, 05/20/2013 - 14:30 | 3581143 dbTX
dbTX's picture

Hitler fell short of a majority (43%), precisely the percentaage Bill Clinton won the Presidency by, thank you very much Ross Perot!!

Mon, 05/20/2013 - 17:02 | 3581729 Diogenes
Diogenes's picture

You might add that as soon as he had the power he "purged" the Nazi party of possible dissidents including Ernst Rohm and the entire SA. Then went on to build concentration camps for the re education of socialists, newspaper editors, trade unionists, communists, and anyone else who might oppose his regime. By the time the war started he had stamped out any opposition in Germany.

Mon, 05/20/2013 - 13:14 | 3580846 Inthemix96
Inthemix96's picture

The wife just bought me some of them magic beans people have been going on about, you know, the ones you plant that grow dead high, straight through the clouds and when you climb up there you find a giants house who owns fuck loads of golden geese.  You know the ones?  they pop out 24 carat gold eggs the size of your fist.

I'm right fucking set I am, just wait, planted them this afternoon and by next month I'm in the fucking money.  She reckons she is buying a pink unicorn next month and it shits blue skittles, so she says like.

And to top it off I put a bid in this very day on E-Bay for a bridge, never been used, only had one previous owner.  Things really couldnt be going better round here, I have a warm fuzzy feeling going on.

Mon, 05/20/2013 - 13:49 | 3581003 css1971
css1971's picture

You could do that, sure.

Or you could do what I'm doing, investing in nuclear, while everybody on the planet hates it.

Mon, 05/20/2013 - 13:57 | 3581037 Inthemix96
Inthemix96's picture

Nuclears fine css if you dont build the plants on fault lines in the earths crust.

Or so I've been told.  Bottom line mate, we need energy, we get it from where we can, when we can.

You look at what man is capable of, what hes done in the past, what he does now and what hes got planned.  We seem to be in the unenviable position of being fucked mate, and no, I have no answers, beyond local community I see nothing in the pipelines to help any of us in any significant way.  All I can say is take care and look after you and yours cos something will give, and I dont think we are far away from it.

Mon, 05/20/2013 - 14:48 | 3581205 RafterManFMJ
RafterManFMJ's picture

Inthemix have you thought about securitizing those geese? You can lever them eggs, and resell them 100X over. It's what the cool kids are doing.

Mon, 05/20/2013 - 14:53 | 3581232 Inthemix96
Inthemix96's picture

Thats the ticket RafterMan,

Its about time I Ponzified the Poultry to the extreme.

By the way, you wanna buy a bridge?

Mon, 05/20/2013 - 15:27 | 3581384 RafterManFMJ
RafterManFMJ's picture

Only if I never get a chance to see it, and you won't tell me where it is. Is there any toll income?

Mon, 05/20/2013 - 15:50 | 3581478 Inthemix96
Inthemix96's picture

Yes there is.

Spiftey seven squid a month.  Its a great buy though, and the asphalt is nearly new, only been travelled on lightley, by unicorns and fairies, and even elves with little green boots.

Its going for a song, if you sing it, its yours.

Mon, 05/20/2013 - 16:51 | 3581686 RafterManFMJ
RafterManFMJ's picture

Damn I mistyped, I meant troll income...

Mon, 05/20/2013 - 15:46 | 3580852 NidStyles
NidStyles's picture

While I see issue with some of this, the entire premise is based upon Oil supply being the major driver of cost while ignoring those printing presses going on in the background. Seems more like another scapegoat for the central planning authority to me.

Mon, 05/20/2013 - 13:18 | 3580857 Species8472
Species8472's picture

He mentions shale gas in closing, so is it oil or gas, or both?

Mon, 05/20/2013 - 13:50 | 3581009 gorillaonyourback
gorillaonyourback's picture

It started out gas but gas drop to 10 cents per cubic foot so now its on to oil

Mon, 05/20/2013 - 13:19 | 3580861 rustymason
rustymason's picture

Lefty libs have a Hitler and Nazi fixation. They apparently cannot write about anything unless they first heap contumely and ad hominem upon any country that opposes Bolshevism. I guess that 2-minute hating on Europeans gets their juices flowing.

Mon, 05/20/2013 - 13:26 | 3580900 JR
JR's picture

Would it be anti Semitic to worry that this kind of message coming from a Jew means there is a connection to race…?

James Howard Kunstler

From Wikipedia, the free encyclopedia

Kunstler was born in New York City to Jewish parents,[1] who divorced when he was eight.[2] His family then moved to the suburbs in Long Island. His father was a middleman in the diamond trade.[1] Kunstler spent most of his childhood with his mother and stepfather, a publicist for Broadway shows.[1]

…He is best known for his books The Geography of Nowhere (1994), a history of American suburbia and urban development, and the more recent The Long Emergency (2005). In the latter book he argues that declining oil production is likely to result in the end of industrialized society as we know it and force Americans to live in smaller-scale, localized, agrarian (or semi-agrarian) communities. Starting with World Made by Hand in 2008, Kunstler has written a series of science fiction novels conjecturing such a culture in the future. He also gives lectures on topics related to suburbia, urban development, and the challenges of what he calls "the global oil predicament" and a resultant change in the “American Way of Life.” Kunstler is also a leading supporter of the movement known as "New Urbanism.

Mon, 05/20/2013 - 13:35 | 3580948 rustymason
rustymason's picture

Well I don't know; I refuse the labels that my enemy puts on me. I only hate those who work to destroy me, and Kunstler is certainly of that kind. His big solution to Peak Oil is more of the same: big daddy government, more multiculturalism, big state projects like rail, and apparently, the abolition of all freedom of movement via gas-powered automobiles.

Mon, 05/20/2013 - 13:54 | 3581027 gorillaonyourback
gorillaonyourback's picture

There must be a picture of u in the dictionary by stupid

Mon, 05/20/2013 - 14:59 | 3581251 Almost Solvent
Almost Solvent's picture

:)

 

Sometimes the most simple response is the most effective. Peak Deniers have one thing on their side, our mighty military will ensure that the 51st state, Saudi Arabia, gives 100% of its oil to us and only us when SHTF for real.

Mon, 05/20/2013 - 15:31 | 3581404 rustymason
rustymason's picture

I'm not "denying" the Peak Oil (or the relgions of MLK, the Holyhoax, or global warming) just the lefty libtard solutions. It is big government boondoggles like wind power, solar power, and ethanol that always make things worse. It is big government insanity that has brought millions of terd worlders into the U.S. and has caused untold misery and strife through its globalist multiculti, anti-Western dictates. it is big government in places like the USSR which have caused extremely bad field management. Kunstler (probably not his real name; probably a bitter, failed Arch student) advocates more of these kinds of destructive policies in response to the problem of diminishing oil supplies. He also spends a huge part of his writing bashing white people for some strange reason. Overall, he is a typical lefty libtard, full of blind hatred and backassward "solutions."

Mon, 05/20/2013 - 20:14 | 3582381 Almost Solvent
Almost Solvent's picture

Peak oil can only be experienced not proven.

Mon, 05/20/2013 - 14:49 | 3581211 TheGardener
TheGardener's picture

As an aside, Nazis were NOT freely elected, just asked to form a government by president Hindenburg.

Next election they won, but with opponents already behind barbed wire.

Mon, 05/20/2013 - 16:39 | 3581653 JR
JR's picture

This point on the German elections has been the fulcrum of misinterpretation and Zionist propaganda for all these years, fueling the charge that Hitler was democratically elected by the people. The details are so important that I am going to provide them here.

And to say that the Nazis were “asked to form a government by President Hindenburg” is a  grave misinterpretation of the facts.

According to Jacob G. Hornberger, founder and president of The Future of Freedom Foundation, here is the following:

The story of how Hitler became a dictator is set forth in The Rise and Fall of the Third Reich, by William Shirer, on which [the following] is based.

In the presidential election held on March 13, 1932, there were four candidates: the incumbent, Field Marshall Paul von Hindenburg, Hitler, and two minor candidates, Ernst Thaelmann and Theodore Duesterberg. The results were:

Hindenburg 49.6 percent
Hitler 30.1 percent
Thaelmann 13.2 percent
Duesterberg 6.8 percent

At the risk of belaboring the obvious, almost 70 percent of the German people voted against Hitler, causing his supporter Joseph Goebbels, who would later become Hitler’s minister of propaganda, to lament in his journal, “We’re beaten; terrible outlook. Party circles badly depressed and dejected.”

Since Hindenberg had not received a majority of the vote, however, a runoff election had to be held among the top three vote-getters. On April 19, 1932, the runoff results were:

Hindenburg 53.0 percent
Hitler 36.8 percent
Thaelmann 10.2 percent

Thus, even though Hitler’s vote total had risen, he still had been decisively rejected by the German people.

On June 1, 1932, Hindenberg appointed Franz von Papen as chancellor of Germany, whom Shirer described as an “unexpected and ludicrous figure.” Papen immediately dissolved the Reichstag (the national congress) and called for new elections, the third legislative election in five months.

Hitler and his fellow members of the National Socialist (Nazi) Party, who were determined to bring down the republic and establish dictatorial rule in Germany, did everything they could to create chaos in the streets, including initiating political violence and murder. The situation got so bad that martial law was proclaimed in Berlin....

Hitler’s rise to power

[In}The July 31, 1932, election...Hitler’s National Socialist Party...won 230 seats in the Reichstag, making it Germany’s largest political party, but it still fell short of a majority in the 608-member body.

On the basis of that victory, Hitler demanded that President Hindenburg appoint him chancellor and place him in complete control of the state. Otto von Meissner, who worked for Hindenburg, later testified at Nuremberg,

Hindenburg replied that because of the tense situation he could not in good conscience risk transferring the power of government to a new party such as the National Socialists, which did not command a majority and which was intolerant, noisy and undisciplined.

Political deadlocks in the Reichstag soon brought a new election, this one in November 6, 1932. In that election, the Nazis lost two million votes and 34 seats. Thus, even though the National Socialist Party was still the largest political party, it had clearly lost ground among the voters.

Attempting to remedy the chaos and the deadlocks, Hindenburg fired Papen and appointed an army general named Kurt von Schleicher as the new German chancellor. Unable to secure a majority coalition in the Reichstag, however, Schleicher finally tendered his resignation to Hindenburg, 57 days after he had been appointed.

On January 30, 1933, President Hindenburg appointed Adolf Hitler chancellor of Germany. Although the National Socialists never captured more than 37 percent of the national vote, and even though they still held a minority of cabinet posts and fewer than 50 percent of the seats in the Reichstag, Hitler and the Nazis set out to consolidate their power. With Hitler as chancellor, that proved to be a fairly easy task.

Mon, 05/20/2013 - 16:56 | 3581710 TheGardener
TheGardener's picture

Thanks for clarification JR , I was just sick of this "freely elected" nonsense. Thanks for the facts.

Or sort of. But no discussion about details when the
entire subject is taboo in many jurisdictions.

Mon, 05/20/2013 - 13:22 | 3580879 Seize Mars
Seize Mars's picture

Sorry dudes I just don't see any peak anything. The idea that compression of biomass by dirt or clay or something makes crude oil is just another fairy story to reinforce the fake scarcity of oil. It's geological. And there is way more of it than they let on. What? An entire industry based on collusion to falsely enforce a scarcity illusion? Must be a conspiracy theory. Ever heard of DeBeers?

Mon, 05/20/2013 - 13:34 | 3580941 ejmoosa
ejmoosa's picture

I am in your camp.  There has never been an explanation of why there oil flows from the same wells of varying geological eras. 

Fossil fuel is a mytholigical term.

 

Mon, 05/20/2013 - 13:51 | 3581013 ITrustMyGut
ITrustMyGut's picture

russians proved.. Abiotic...

think in these terms.. the alledged biomass to have created a gwhar?  3 cubic miles of organic debris?

idiotic..macondo was going after a abiotic spot...

Mon, 05/20/2013 - 15:38 | 3581435 rustymason
rustymason's picture

Ambiotic oil is baloney. Those fields were just badly managed to begin with. In short, the oil was sucked out too fast, and when the water came in they were abandoned. Over time the oil had a chance to migrate back into position. Redrilling the same formations years later, they discovered that the water had been displaced and it looked like new oil had appeared. Kunstler is a homocidal lunatic.

Mon, 05/20/2013 - 14:27 | 3581126 WillyGroper
WillyGroper's picture

Have a relative, a geophysicist. He says we're awash in oil. 

Energy independence? Who knows.

Mon, 05/20/2013 - 14:48 | 3581201 ian807
ian807's picture

Unless your relative is bathing in oil, he's wrong, or he has trouble with arithmetic. The world uses 30 billion barrels a year, more or less. That would give us about 40 years left of conventional oil, and perhaps another 40 of unconventional (assuming the current estimates aren't political hogwash).

Sounds great, right? What your relative forgot to mention and will be unable to tell you is that the NET energy from the oil we get now is much, much less than we got when we first started drilling.

FYI, NET energy is why we drill at all. If we don't get a lot more energy out than we put in, it's not worth doing. Net energy X quantity of oil = Total energy

Bottom line? We don't have an oil supply problem. We DO have an ENERGY problem. They're different. The crude (better named "crud") that we're getting from the Canadian oil sands has a net energy of 4:1. About as much as cord wood.

Most of that oil we're "awash" in will be too expensive, and too energy poor to do us any good.

As for the Abiotic theory of oil, it's still hogwash. Oil restarts from old reservoirs because it slowly leaks from other unknow reservoirs and always has. This is a distinctly non-mysterious phenomenon.

Mon, 05/20/2013 - 15:13 | 3581325 WillyGroper
WillyGroper's picture

I suppose a global convention of GP's could all be bad at arithmetic & FOS to boot. 

What was ur line of work?

Mon, 05/20/2013 - 17:43 | 3581829 TrustWho
TrustWho's picture

807....Law of Diminishing Returns, once we had net energy of 199:1, so the 200 billion oil field that yielded 199 billion in net energy; today yields 150 billion. 

Mon, 05/20/2013 - 15:13 | 3581324 orangegeek
orangegeek's picture

Agreed. 

 

Peak oil nuts had their hearts broken when oil went from $150 to $30 - welcome to the pump and dump.

 

Obama is blocking keystone (which is operational and has been from over two years) so deep sea Brazilian (via Petrobras and Soros) will take its place.

 

Oil has more to do with agendas.

Mon, 05/20/2013 - 15:25 | 3581368 hardcleareye
hardcleareye's picture

Can you tell me what the production cost is of tar sand oil?

How about the production cost of Shale Oil ie kerogen oil? (lol - snicker)

Do you understand the difference between shale oil (kerogen oil) and tight oil?

Setting aside production cost can you tell me the "extraction rate" and the decline rate of these reserves?

(Sadly shaking head, ignorance is bliss.....)

 

Mon, 05/20/2013 - 16:46 | 3581676 Citxmech
Citxmech's picture

"Peak oil nuts had their hearts broken when oil went from $150 to $30 - welcome to the pump and dump."

Oil is currently being manipulated to keep it in the $100-105 range (Brent) to keep investment funds flowing.  This is being done precisely because of the damage the swing from $147 - 30 caused.

Wild swings in price kill the investments in development and interrupt continuity in high-cost extraction projects necessary to keep the spice, and the global economy flowing.  The POO needs a shock-absorber otherwise the swings could become divergent - functionally destroying stability in supply, and hence the ability for the transportation sector to function.

Mon, 05/20/2013 - 13:30 | 3580919 tweake
tweake's picture

Totally misses the point, apparently do to confusion caused by a lot of unresolved fuzzy philosophical issues.

The wells are economic (IRR) therefore they are.  Aided by high success rates of course.

Mon, 05/20/2013 - 13:33 | 3580934 aerojet
aerojet's picture

So sick of Kunstler--he's a broken record.  Not a single time has he done anything in an article besides bash suburbia and complain about peak oil. Not one fucking time has he ever proposed a solution for any problem.  Just typical Baby Boomer Doom & Gloom.  Mr. Kunstler, get a fucking grip--you will be long dead before you have to worry about the social consequences of the oil running out.  Go do something else with your remaining years you piece of shit.

Mon, 05/20/2013 - 14:05 | 3581062 TrustWho
TrustWho's picture

Malthus correctly identiifed the problem long ago. He put a time stamp on his forecast, but he missed massive irrigation projects, hybrid corn, analytical techniques, petroleum industry, nitrogen energy, phosphate and k production, computer technology, mechanical technology and much much more. The best and most correct economic law--law of diminishing return will continue the diminishing return of the marginal output unit, so Malthus prediction will be proven true, but much delayed.

Actually, this is Daddy Bernanke's hope, except he has substituted fiat currency for technology. If he can just keep pumping money, maybe he can delay until he has retired.

Mon, 05/20/2013 - 14:13 | 3581089 NidStyles
NidStyles's picture

I like how you simply ignored the faults in Malthus's premises while stating them within the same post. Technology does not stand still for anyone, and least of all will it stand still and let a crank like Malthus prove anything other than how totally arrogant and backwards he was. Population and advances will continue to do their thing, and eventuallyt those ridiculous notions of Malthus will fade away like they should have after Smith wrote about them.

Mon, 05/20/2013 - 17:46 | 3581640 akak
akak's picture

Tell it to the ancient Mayans, who depleted their soil fertility to the point of societal collapse, or the former civilization of Easter Island, who not only made extinct every species of tree on their island, but who eventually collapsed into mass starvation and cannibalism (all of AnAnonymous' drivel about time-traveling "US 'american' citizenism" having doomed them to the contrary).

Just because Malthus was not correct everywhere and always does not mean that he was not correct at some times, or in some places.

Mon, 05/20/2013 - 17:01 | 3581728 Citxmech
Citxmech's picture

It is also arrogance to assume technology will always save us.  The limits to efficiency gains are being totally overpowered by exponential growth.  Witness the decline in EROEI and extrapolate with an eye on Tainter's theory of collapse (based upon decreasing marginal returns in overly specialized societies).  Tainter's theory is now being played out in concert on a global-level.

Mon, 05/20/2013 - 23:36 | 3582970 DaveyJones
DaveyJones's picture

"Population and advances will continue to do their thing"

you meant advances in population will continue to do their thing

Mon, 05/20/2013 - 14:59 | 3581260 A. Magnus
A. Magnus's picture

Malthus proposed the same thing as Marx, only without all the attendant City of London financial backing; essentially they both were inbred elitist douche nozzles who paraded the boogeymen of starvation and societal collapse as a justification for cementing state control over EVERYTHING.

In other words, Maltus, like Marx, are full of collectivist bullshit, as are any arguments derived from them...

Mon, 05/20/2013 - 15:49 | 3581473 NidStyles
NidStyles's picture

They honestly only extrapolated the conclusions that Adam Smith set forth. If we are to blame anyone it's the absolutists Physiocrats and Adam Smith for writing their nonsense.

Mon, 05/20/2013 - 14:03 | 3580943 earleflorida
earleflorida's picture

'the energy fix' @ popular science! 

 top navigation bar >science (category- energy) <> technology (category- the energy fix)>          http://www.popsci.com/article/category/tags/energy

http://www.popsci.com/article/2013/05/categary/tags/-energy-fix

http://www.popsci.com/article/2013/05/future-energy-water       ~70% of planet earth is water-- it's time to coexist?

http://www.popsci.com/article/2013/05/future-energy-global-landscape        of the ~30% of inhabitable land, there is ~5% that's no-man/beast land-- but, energy abundant?

http://www.popsci.com/article/2013/05/future-energy-solar

great read, thankyou for caring :-))

Mon, 05/20/2013 - 13:35 | 3580951 overmedicatedun...
overmedicatedundersexed's picture

no oil no peace.

Mon, 05/20/2013 - 14:16 | 3581072 earleflorida
earleflorida's picture

'Assad talks, Russia walks'  pepe Escobar @ atimes.com  5/20/13

no blue gold, means no oil, period!    http://www.atimes.com/atimes/World/WOR-01-200513.html

http://www.alarabiya.net/articles/2013/02/20/267257.html

U.S. foreign policy__ a twofer-- a plausible-deniability? genocide/ ethnic cleansing/ eugenic's at it's best*/ and, unimaginable energy profits for the faceless oligarchy fascist running our 'foreign policy'... for the last century!!!

Mon, 05/20/2013 - 13:37 | 3580956 Inthemix96
Inthemix96's picture

Could I just point out something here for those that may not know.

Us of the victorious Allies, us fine upstanding Britishers, did you see what we did to Dresden in Germany?  Look it up.  If this were now, and in any other terms what we did to the city of Dresden in Germany would be considered a war crime.

We anihilated the place.  Men, women, children, dogs, cats, birds, homes, churches, businesses, parks, cemetarys the whole shebang.  We destroyed everything, there was nothing left.  Perhaps Mr Kunstler should look back and understand that the victorious Allies done some horrific things to those that deserved nothing of the sort.

A black page in our history is Dresden, what them poor bastards went through I wouldnt like to imagine.

Not everything you read is black and white Mr Kunstler, look it up, you look foolish if you portray one way thinking.

Mon, 05/20/2013 - 13:42 | 3580975 TNTARG
TNTARG's picture

We anihilated the place.  Men, women, children, dogs, cats, birds, homes, churches, businesses, parks, cemetarys the whole shebang.  We destroyed everything, there was nothing left.

It didn't stop. There's "liberated" Irak. Also Libya. And it still is war crime.

Mon, 05/20/2013 - 13:54 | 3581025 TrustWho
TrustWho's picture

...the allies knew Dresden was a war crime before war II ended; however the winners never commit war crimes.

Mon, 05/20/2013 - 14:01 | 3581047 Inthemix96
Inthemix96's picture

Thats right Trust,

Just look on the Discovery Channel.

The winners write history friend, some of the stories and eye witness accounts I have read regarding Dresden have had me in tears.  Makes me think that humans, those not awake are like lab rats.  Unthinking fucking imbeciles who do the bidding of their masters.

Dresden should be a lesson to mankind of what he is capable of when pushed the wrong way.

Mon, 05/20/2013 - 15:14 | 3581326 hardcleareye
hardcleareye's picture

Suggest you read the book written by Frederic Taylor, Dresden.

"Discovery Channel"......  oh please!!!!!

Mon, 05/20/2013 - 15:24 | 3581359 Inthemix96
Inthemix96's picture

Sorry hardclear,

I didnt make myself clear there,

Just look on the Propaganda Outlet Channel To Make Germans Perpetually Sorry For Crimes Commited Not In Their Name.

Or discovery channel.  Hope that clears that up like.

Mon, 05/20/2013 - 14:02 | 3581053 Rustysilver
Rustysilver's picture

Inthemix.

The British Bombing and US Army Air Force were determine to show Germans who won WW II. That's why you got Dresden and the rest. There was no logic to it.

Somewhere on youtube British Royal Air General was discussing the strategy.

Mon, 05/20/2013 - 14:17 | 3581096 Inthemix96
Inthemix96's picture

I know Rusty,

No logic at all, just some fuckers sitting round a table deciding the lives of those innocents were worth less than the shit on your shoe, a show of might to let them know who won and whos boss eh?

A sickening display of pure Allied power is all it was, back then the populace had the excuse of knowing fuck all as all the propaganda they got was from the press or the 'Wireless', today is no excuse mate, we have these things we typing our minds onto, its awakened a lot of folk has the web, and growing by the day.

God rest the souls of the innocents systematically obliterated in Dresden.

They derserved nothing of the sort.

Mon, 05/20/2013 - 15:11 | 3581320 hardcleareye
hardcleareye's picture

The story of Dresden is a sad tale indeed....  but it was a legitimate target and was so far to the east that it exceed the range of the bombers, and thus escaped bombing until the end.

Dresden was a different kind of military target, they made sub assemblies and radars etc and it was a large rail hub.

The Russians were pushing from the east and the allies wanted to make their job easier. 

Remember the Germans were the ones who started the "fire storms" strategy ie Coventry.  The Allies just got better at it!

Both sides have dirty hands.

Mon, 05/20/2013 - 17:36 | 3581810 JR
JR's picture

The Dresden instance, it turns out, was the most infamous act of cowardice combined with treachery and pointless killing in history.

Every word of the Associated Press reports in the war moved through U.S. government censors and direction…

Thus the significance of AP’s coverage of the horrendous and relentless bombing of Dresden, Germany in February, 1945.

“This unprecedented assault in daylight on the refugee-crowded capital, fleeing from the Russian tide in the East,” the AP correspondent reported from Supreme Allied Headquarters in Paris, showed that “the long-awaited decision had been taken to adopt deliberate terror-bombing of German populated centres as a ruthless expedient to hasten Hitler’s doom.”

Note the objective of the Allies: “terror.”

The gloating in those words rings all through our era, from the unconcern for women and children burned in the streets of Dresden because they were Germans to the apathy concerning families slaughtered in the Middle East because they are Muslims

The ancient cultural center of Dresden, a city rich in 18th century architecture, was not a military or industrial target so it had little or no anti-aircraft weapons as an air attack was not anticipated. As the war was winding down, Russian forces were sweeping across Germany from the East and Dresden’s normal population of 600,000 had recently swollen an additional 300,000 to 500,000 with refugees fleeing the Russian advance, now only 70 miles away.

Dresden had no air raid shelters; every public building was crowded with refugees, mostly women and children, and many were camped in the streets.

The first attack came at night…about 9:30 p.m. … as the British Royal Air Force sent in more than 800 heavy bombers.  All planes returned to base safely.  And while heavy black smoke covered the city next day, an armada of bombers went back to give it everything they had - 1,350 Fortresses and Liberators.  The following day, 1,100 U.S. 8th Army Air Force bombers hit the devastated Dresden a third time.

In 36 hours, perhaps, 250,000 people were killed…funeral piles of 500 bodies each burned for days.

Some isolated anguish over the Dresden attack brought to light details of a pattern of RAF terror bombing under the Linderman plan first used in March, 1942.  Professor Frederick Linderman, scientific advisor to Churchill, reasoned that bombing German residential working-class areas and smaller cities would be easier to hit than military and industrial targets, would provide greater concentrations of death and destruction, wouldn’t be as dangerous to pilots and would help the population urge their leaders to surrender.

Mon, 05/20/2013 - 17:45 | 3581835 groundedkiwi
groundedkiwi's picture

Quote....People should either be carressed or crushed. If you do them minor damage they will get their revenge, but if you cripple them there is nothing they can do. .....Machiavelli.

Naomi Klein's book Shock Doctrine explained the profits made from annihlation

Mon, 05/20/2013 - 14:10 | 3581078 Marigold
Marigold's picture

Yes and they did the same to Wurtzburg. Firebombed the whole city which was basically a university and Ecclesiastical city. Now faithfully rebuilt like Dresden.... Beautiful place.

Mon, 05/20/2013 - 16:22 | 3581601 Shigure
Shigure's picture

@ Inthemix96

"We anihilated the place.  Men, women, children, dogs, cats, birds, homes, churches, businesses, parks, cemetarys the whole shebang.  We destroyed everything, there was nothing left"

The atomic bombing of Hiroshima and Nagasaki were war crimes also.

PS: you are on a roll tonight!

Mon, 05/20/2013 - 16:34 | 3581637 Inthemix96
Inthemix96's picture

The truth will out friend.

;-)

Mon, 05/20/2013 - 17:28 | 3581794 groundedkiwi
Mon, 05/20/2013 - 13:38 | 3580958 TNTARG
TNTARG's picture

So, here we are and there are they, pretending that there's democracy, pretending we've infinite oil reserves, pretending that they're fighting against terrorism, pretending we've a free press, pretending we live in a World of free market, pretending 9/11 was a Al Qaida terrorist attack, pretending DEA works against drug production and traffic, pretending Big Pharma is working on diseases' prevention and healing and  pretending we have the UN who stand for us all, pretending Europe is United, pretending the US dollar is a strong currency, pretending there's no inflation, pretending the Euro isn't going to fall, pretending there isn't enough food for all human beings on this Earth, pretending there's not enough clean energy, pretending the oil spill into the Gulf of Mexico has been contained, pretending nothing is happening in Fukushima/Japan/the Pacific Ocean with radioactivity, avoiding facing reality.

So much for the dominant specie on the Planet. The unique suicidal one.

P.S.: There's a lot of oil that can be taken from the sea and contaminated lands. /sad sarc.

Mon, 05/20/2013 - 13:43 | 3580959 rustymason
rustymason's picture

Ambiotic Oil is not a proven theory. Even if it were, we are pulling oil out much, much faster than it supposedly replenishes, so it's not a solution to anything at this time. It might be true, but we are not even close to being able to harness it.

Mon, 05/20/2013 - 15:29 | 3581388 Citxmech
Citxmech's picture

You mean nature just doesn't fill our gas tank and automatically shut-down the process when we're topped-off?

JFC, it's never been about reserves - it's about extraction rates and EROEI.

Net energy extraction per capita has been in decline since 1977 btw.  So much for tech saving the day.

Mon, 05/20/2013 - 13:38 | 3580963 Floodmaster
Floodmaster's picture

Waiting for a US Desertec equivalent.

http://en.wikipedia.org/wiki/File:Fullneed.jpg

Mon, 05/20/2013 - 13:45 | 3580983 Craxi
Mon, 05/20/2013 - 14:01 | 3580984 0b1knob
0b1knob's picture

Before peak oil there was peak coal.

 

https://en.wikipedia.org/wiki/The_Coal_Question

 

As early as 1860 economists and scientists predicted that England's production of coal would peak in the near future.   They even got the time frame correct to within a decade or so.   The only solution they could see was to reduce coal usage and living standards to preserve the remaining coal as long as possible and prevent a sudden collapse into chaos.  (Sound familiar?)   The steam age and the industrial revolution was almost universally seen as temporary unsustainable bubble.

 

Well their general idea was correct but they didn't foresee the developement of an oil based economy.  Just like people today can't imagine a replacement for oil.    

 

Solar is almost competitive right now.    Fission, especially thorium could be a game changer.    A hydrogen based transport system could replace oil the same as natural gas is already replacing diesel forr the trucking business.    Fusion remains 20 years in the future but one day the future will arrive.

 

Human ingenuity is nearly as limitless as human stupidity.   I always find Tyler's neo-Malthusian ideas and George Washinton's global-warming-is-real posts sort of entertaining.   But a person either believes in free markets and progress or they do not.    All this country needs is a leader with a brain and a pair and its FORWARD! into the future of real hope and change.

Mon, 05/20/2013 - 17:12 | 3581758 Citxmech
Citxmech's picture

See: "Post hoc ergo propter hoc"

The depletion of coal did not cause the availability of a more energy rich substance (oil) to be within grasp.

While human ingenuity may be impressive - it is bound by the limits of thermodynamics as well as the environment.  To sustain the trajectory we're on now, we would need something more energetic and available than oil (higher EROI) and we needed it yesterday.

We are already past the point where we can retool to take advantage said unknown fuel without experiencing a major economic and production collapse - so you techno-triumphalist scientists/engineers better get a move-on.   

Mon, 05/20/2013 - 23:43 | 3582988 DaveyJones
DaveyJones's picture

you  seem to mistake "free markets" and "progress" with denying the physical limits of natural resources and an ever growing population.  

Mon, 05/20/2013 - 13:46 | 3580986 BattlegroundEur...
BattlegroundEurope2011's picture

Where the fuk is Lindsey Williams?

 

Mon, 05/20/2013 - 13:46 | 3580988 BattlegroundEur...
BattlegroundEurope2011's picture

I got a pencil and paper ready...

 

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