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"Houston, You Have A Problem" - Texas Is Headed For A Recession Due To Oil Crash, JPM Warns

Tyler Durden's picture




 

It was back in August 2013, when there was nothing but clear skies ahead of the US shale industry that we asked "How Much Is Oil Supporting U.S. Employment Gains?" The answer we gave:

The American Petroleum Institute said last week the U.S. oil and natural gas sector was an engine driving job growth. Eight percent of the U.S. economy is supported by the energy sector, the industry's lobbying group said, up from the 7.7 percent recorded the last time the API examined the issue. The employment assessment came as the Energy Department said oil and gas production continued to make gains across the board. With the right energy policies in place, API said the economy could grow even more. But with oil and gas production already at record levels, the narrative over the jobs prospects may be failing on its own accord.... The API's report said each of the direct jobs in the oil and natural gas industry translated to 2.8 jobs in other sectors of the U.S. economy. That in turn translates to a total impact on U.S. gross domestic product of $1.2 trillion, the study found.

Two weeks ago we followed up with an article looking at "Jobs: Shale States vs Non-Shale States" in which we showed the following chart:

And added the following:

According to a new study, investments in oil and gas exploration and production generate substantial economic gains, as well as other benefits such as increased energy independence.  The Perryman Group estimates that the industry as a whole generates an economic stimulus of almost $1.2 trillion in gross product each year, as well as more than 9.3 million permanent jobs across the nation. 

 

 

The ripple effects are everywhere. If you think about the role of oil in your life, it is not only the primary source of many of our fuels, but is also critical to our lubricants, chemicals, synthetic fibers, pharmaceuticals, plastics, and many other items we come into contact with every day. The industry supports almost 1.3 million jobs in manufacturing alone and is responsible for almost $1.2 trillion in annual gross domestic product. If you think about the law, accounting, and engineering firms that serve the industry, the pipe, drilling equipment, and other manufactured goods that it requires, and the large payrolls and their effects on consumer spending, you will begin to get a picture of the enormity of the industry.

Another way of visualizing the impact of the shale industry on the US economy comes courtesy of this chart from the Manhattan Institute which really needs no commentary:

The Institute had this commentary to add:

The jobs recovery since the 2008 recession has been the slowest of any post recession recovery in the U.S. since World War II. The number of people employed has yet to return to the 2007 level. The country has suffered a deeper and longer-lasting period of job loss than has followed any of the ten other recessions since 1945.

 

There has, however, been one employment bright spot: jobs in America’s oil & gas sector and related industries. Since 2003, more than 400,000 jobs have been created in the direct production of oil & gas and some 2 million more in indirect employment in industries such as transportation, construction, and information services associated with finding, transporting, and storing fuels from the new shale bounty.

 

In addition, America is seeing revitalized growth and jobs in previously stagnant sectors of the economy, from chemicals production and manufacturing to steel and even textiles because of access to lower cost and reliable energy.

...

The surge in American oil & gas production has become reasonably well-known; far less appreciated are two key features, which are the focus of this paper: the widespread geographic dispersion of the jobs created; and the fact that the majority of the jobs have been created not in the ranks of the Big Oil companies but in small businesses, even more widely dispersed.

Fast forward to today when we are about to learn that Newton's third law of Keynesian economics states that every boom, has an equal and opposite bust.

Which brings us to Texas, the one state that more than any other, has benefited over the past 5 years from the Shale miracle. And now with crude sinking by the day, it is time to unwind all those gains, and give back all those jobs. Did we mention: highly compensated, very well-paying jobs, not the restaurant, clerical, waiter, retail, part-time minimum-wage jobs the "recovery" has been flooded with.

Here is JPM's Michael Feroli explaining why Houston suddenly has a very big problem.

* * *

  • In less than five years Texas’ share of US oil production has gone from around 25% to over 40%
  • By some measures, the oil intensity of the Texas economy looks similar to what it was in the mid-1980s
  • The 1986 collapse in oil prices led to a painful regional recession in Texas
  • While the rest of the country looks to benefit from cheap oil, Texas could be headed for recession

The collapse in oil prices will create winners and losers, both globally and here in the US. While we expect the country, overall, will be a net beneficiary from falling oil prices, two states look like they will bear the brunt of the pain: North Dakota and Texas. Given its much larger size, the prospect of a recession in Texas could have some broader reverberations. 

 

By now, most people are familiar with the growth of the fossil fuel industry in places like Pennsylvania and Ohio. However, that has primarily been a natural gas story. The renaissance of US crude oil production has been much more concentrated: over 90% of the growth in the past five years has been in North Dakota and Texas; with Texas alone accounting for 67% of the increase in the nation’s crude output over that period.

 

In the first half of 1986, crude oil prices fell just over 50%. At the end of 1985, the unemployment rate in Texas was equal to that in the nation as a whole; at the end of 1986 it was 2.6%- points higher than the national rate. There are some reasons to think that it may not be as bad this time around, but there are even better reasons not to be complacent about the risk of a regional recession in Texas.

 

 

 

Geography of a boom

 

The well-known energy renaissance in the US has occurred in both the oil and natural gas sectors. Some states that are huge natural gas producers have limited oil production: Pennsylvania is the second largest gas producing state but 19th largest oil producer. The converse is also true: North Dakota is the second largest crude producer but 14th largest gas producer. However, most of the economic data as it relates to the energy sector, employment, GDP, etc, often lump together the oil and gas extraction industries. Yet oil prices have collapsed while natural gas prices have held fairly steady. To understand who is vulnerable to the decline in oil prices  specifically we turn to the EIA’s state-level crude oil production data.

 

The first point, mentioned at the outset, is that Texas, already a giant, has become a behemoth crude producer in the past few years, and now accounts for over 40% of US production. However, there are a few states for which oil is a relatively larger sector (as measured by crude production relative to Gross State Product): North Dakota, Alaska, Wyoming, and New Mexico. For two other states, Oklahoma and Montana, crude production is important, though somewhat less so than for Texas. Note, however, that these are all pretty small states: the four states where oil is more important to the local economy than Texas have a combined GSP that is only 16% of the Texas GSP. Finally, there is one large oil producer, California, which is dwarfed by such a huge economy that its oil intensity is actually below the national average, and we would expect it, like the country as a whole, to benefit from lower oil prices.

 

Texas-sized challenges

 

As discussed above, Texas is unique in the country as a huge economy and a huge oil producer. When thinking about the challenges facing the Texas economy in 2015 it may be useful, as a starting point, to begin with the oil price collapse of 1986. Then, like now, crude oil prices collapsed around 50% in the space of a few short months. As noted in the introduction, the labor market response was severe and swift, with the Texas unemployment rate rising 2.0%-points in the first three months of 1986 alone. Following the hit to the labor market, the real estate market suffered a longer, slower, burn, and by the end of 1988 Texas house prices were down over 14% from their peak in early 1986 (over the same period national house prices were up just over 14%). The last act of this tragedy was a banking crisis, as several hundred Texas banks failed, with peak failures occurring in 1988 and 1989.

 

How appropriate is it to compare the challenges Texas faces today to the ones they faced in 1986? The natural place to begin is by getting a sense of the relative energy industry intensity of Texas today versus 1986. Unfortunately, the GSP-by-industry data have a definitional break in 1997, but splicing the data would suggest a similar share of the oil and gas sector in Texas GSP now and in 1985: around 11%. Employment in the mining and logging sector (which, in Texas, is overwhelmingly dominated by the oil and gas sector) was around 3.7% in 1985 and is 2.7% now. This is consistent with a point we have been making in the national context: the oil and gas sector is very capital-intensive, and increasingly so. Even so, as the 1986 episode demonstrated, there do seem to be sizable multiplier effects on non-energy employment. Finally, there does not exist capital spending by state data, but at the national level we can see the flip side of the increasing capital intensive nature of energy: oil and gas related cap-ex was 0.58% of GDP in 4Q85, and is 0.98% of GDP now.

 

Given this, what is the case for arguing that this time is different, and the impact will be smaller than in 1986? One is that now, unlike in 1986, natural gas prices haven’t moved down in sympathy with crude oil prices, and the Texas recession in 1986 may have owed in part also to the decline in gas prices. Another is that, as noted above, the employment share is somewhat lower, and thus the income hit will be felt more by capital-holders – i.e. investors around the country and the world. Finally, unlike 1986, the energy industry is experiencing rapid technological gains, pushing down the energy extraction cost curve.

 

While these are all valid, they are not so strong as to signal smooth sailing for the Texas economy. Financially, oil is a fair bit more important than gas for Texas, both now and in 1986, with a dollar value two to three times as large. Moreover, while energy employment may be somewhat smaller now, we are not talking about night and day. The current share is about 3/4ths what it was in 1986. (Given the higher capital intensity, there are some reasons to think employment may be greater now in sectors outside the traditional oil and gas sectors, such as pipeline and heavy engineering construction).

As we weigh the evidence, we think Texas will, at the least, have a rough 2015 ahead, and is at risk of slipping into a regional recession. Such an outcome could bring with it the usual collateral damage that occurs in a slowdown. Housing markets have been hot in Texas. Although affordability in Texas looks good compared to the national average, it always does; compared to its own history, housing in some major Texas metro areas looks quite dear, suggesting a risk of a pull-back in the real estate market.

 

The national economy performed quite well in 1986, in spite of the Texas recession. We expect the US economy will perform well next year too , though some  regions – most notably Texas – could significantly underperform the national average.

* * *

So perhaps it is finally time to add that footnote to the "unambiguously good" qualified when pundits describe the oil crash: it may be good for everyone... except Texas which is about to enter a recession. And then Pennsylvania. And then North Dakota. And then Colorado. And then West Virginia. And then Alaska. And then Wyoming. And then Oklahoma. And then Montana, and so on, until finally we find just where the new equilibrium is following the exodus of hundreds of thousands of the best-paying jobs created during the "recovery" offset by minimum-wage waiters, bartenders, retail workers and temps.

 

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Sun, 12/21/2014 - 14:51 | 5578497 Oldwood
Oldwood's picture

We are going to get Obama's number crunchers on this and they will have some inproved, seasonally adjusted ones out soon...so whatever you do, don't sell anything....buy the fucking dip...got it?

Sun, 12/21/2014 - 13:09 | 5578179 First There Is ...
First There Is A Mountain's picture

Go ahead and add Colorado to that list.....Half the people I know are in oil and gas, whether directly or through financial services. 

Sun, 12/21/2014 - 13:15 | 5578190 Handful of Dust
Handful of Dust's picture

Colorado's pristine environment days are long gone I'm afraid. Last time I was up there I could not drive more then 25 miles before seeing another patch torn up by some sort of rig. It's pretty sad. Call it greed, call it need, it's still sad.

Sun, 12/21/2014 - 13:33 | 5578236 First There Is ...
First There Is A Mountain's picture

The I-70 corridor above all else but it's gradually expanding to the more urban corridors as well. From Edwards (Beaver Creek to most) all the way to Grand Junction is basically being hole punched with increasing frequency. The greatest destruction often comes from the steady stream of semis (many of them HAL) and the support/service rigs. As a native, I've seen this pattern play out three separate times in my comparatively short 41 years. Why should this time be any different. 

Good friend is a mechanical engineer with Nabors. They essentially lease out drill rigs so you can imagine where their business is heading. My neighbor is a geophysicist who works for Western Geco. He'll be alright for awhile and is poised to retire soon anyway but these are good 6 figure jobs that are going away soon at these levels. Those same salaries put a bullseye on your back when a lot of these guys admit their jobs are very light on the engineering and very heavy on the adminstrative/managerial. 

I'm a principal in a mid size brokerage and a former market maker/trader and the amount of ancillary monies generated in oil and gas from this standpoint cannot be underestimated as well. I see a lot of trade tickets and new account apps and much of that money is derived from the oil patch. 

Oh well, c'est la vie. Live by the sword, die by the sword and all those other hollow platitudes. 

 

Sun, 12/21/2014 - 13:41 | 5578258 El Hosel
El Hosel's picture

Time to Short titty bars

Sun, 12/21/2014 - 16:39 | 5578834 e_goldstein
e_goldstein's picture

Go long $5 toothless whores.

Sun, 12/21/2014 - 13:39 | 5578250 arby63
arby63's picture

But I still hear commercials for "owning your own oil well" for qualified investors! 

Sun, 12/21/2014 - 14:54 | 5578508 Oldwood
Oldwood's picture

Are they on sale with zero down? It could be the next big subprime opportunity!

Sun, 12/21/2014 - 13:44 | 5578267 Amerikan Patriot
Amerikan Patriot's picture

I just filled the Escalade for $2.02/gallon.  Good times!

Only Zero Hedgers want higher oil/gas prices.  Everyone else understands that lower prices are more preferable.

Mobil, Shell, etc. should accommodate Zero Hedgers with pumps that charge $4.00/gallon.

Sun, 12/21/2014 - 13:50 | 5578283 Everyman
Everyman's picture

So you are a reactionary moron and cannot properly analyze the "big picture"?  ALL data points to a problem in the gas producing regions.  IF you saw he Midland Odessa "boom" then you would understand.  But rating the economy with your "armchair analysis" that YOUR gasoline is cheaper therefore better for the economy, shows the simpleton that you are.

Sun, 12/21/2014 - 14:10 | 5578348 Amerikan Patriot
Amerikan Patriot's picture

Bob, the cure for low prices is...low prices.

Pull your head out of your ass (it'll make a distinctive "thunk" sound) when you've got it.

Sun, 12/21/2014 - 14:31 | 5578422 Deathrips
Deathrips's picture

Tell that to a venezualan wiping his ass with a hand full of dirt and a fingernail.

 

Price controls fuck markets...

 

Fuck off moron.

 

RIPS

Sun, 12/21/2014 - 14:35 | 5578435 TheReplacement
TheReplacement's picture

An honest ZH'er would admit that the worse this is the better chance it might turn out good.  It means less $ out of pocket for Joe Sixpack and maybe, just maybe, it is the blackswan we've all been waiting for.

It had to end sometime.  Soon?

Sun, 12/21/2014 - 14:21 | 5578387 Buster Cherry
Buster Cherry's picture

Sooner rather than later you won't be able to afford your Escalade or the cheap gas to fill it with.

 

Don't take my word for it. When t happened in the 80's I was lucky enough to be able to move back to my parents house when my oil tool machinist job disappeared overnight.

Sun, 12/21/2014 - 13:51 | 5578275 itstippy
itstippy's picture

Here in Wisconsin the northern counties have gotten a big economic boost from frack sand mining.  Apparently the size and shape of the sand grains are perfect for use in fracking.  They scoop up the sand and load it on big trucks, haul it to the nearest rainroad siding, and ship it to the Dakotas.  

It's been a welcome boom in a historically economically depressed area.  The environmentalists and Native Americans aren't very happy though, and many locals are pissed off about the influx of people and how the big trucks tear up the roads.

Sun, 12/21/2014 - 16:24 | 5578782 jerry_theking_lawler
jerry_theking_lawler's picture

You are very correct. I talked to the Carbo guys a couple of years back about doing some work for them up in Wisconsin...perfect sand, apply an additional coatinga and you have a product almost as good as their ceramics.....anyways, saw the nature in the boom-bust (lived through it before) and decided against it. These guys are definitely going to take it up the *ss soon as their revenue dries up, and quick.

Sun, 12/21/2014 - 13:49 | 5578281 Amerikan Patriot
Amerikan Patriot's picture
Google Is Now Bigger Than Mother Russia’s Entire Market By

Published: Dec 18, 2014 8:51 a.m. 

Americans hardly had time to savor the schadenfreude of Vladimir Putin’s financial Chernobyl before North Korea managed to flip the script on the evil Yankee imperialists, it appears.

Now, while Hollywood mourns the loss of creative expression, Kim Jong-un is probably kicking back somewhere on his private island, sucking down his father’s cognac and enjoying the creepy serenade of five indentured toddlers. A celebratory slap-and-tickle fight with Dennis Rodman in a wedding dress can’t be too far behind.

In the midst of all this, the stock market went MAD. As in, it logged a major accumulation day, defined as a session when up volume on the NYSE is at least nine times more than the down volume, according to Urban Carmel of the Fat Pitch blog. And Wednesday’s MAD, the first since October of last year, came in with a lopsided ratio of 17 to 1.

Does the market have yet another V-shaped bounce in it before the end of the year? “[MAD] is telling you that investors overwhelmingly see equities as attractive or oversold at current prices,” Carmel said. “It’s a bullish sign and normally (but not always) initiates a move higher in price.”

Market strategists, for the most part, agree that, despite all the reasons to doubt it, good times lie ahead in the coming year. Their average prediction: 10% higher on the S&P. That’s pretty optimistic, even for these typically bullish characters.

Specifically, our call of the day is chewing on the possibility of a move higher — a huge, Apple-esque move higher — for shares of Google. And why not? It just blew past Russia (more on that below).

The ruble USDRUB, +0.00%  continues to recover from the bloodbath earlier this week, after Russian President Putin uttered soothing words Thursday that the currency will stabilize and the economic pain will pass. But the ruble is a wickedly volatile currency these days, so by the time you read this it could have moved back into red. Gold GCG5, -0.03%  is also on the move north and so is crude, which is staging a 3% rally. No MAD taking shape early, but futures on the Dow US:YMZ4  and the S&P US:ESZ4  are indicating another solid day on Wall Street. Asia, ADOW, +1.72% led by the Nikkei NIK, +2.39% busted out to the upside. Europe SXXP, +0.37%  is also showing off, with gains almost everywhere except Greece.

 

Sun, 12/21/2014 - 14:01 | 5578323 Max Steel
Max Steel's picture

Low oil prices aren't good for world economy . You missed that article on zh bob .

Sun, 12/21/2014 - 14:13 | 5578358 Amerikan Patriot
Amerikan Patriot's picture

I agree, low prices aren't good for you, Bob.

Shell, Mobil and the others will be up and running with the special pumps that have Zero Hedge ($4.00/gallon) pricing soon. 

Sun, 12/21/2014 - 14:50 | 5578500 IndyPat
IndyPat's picture

Fuck you, Bob.

Sun, 12/21/2014 - 15:02 | 5578537 Amerikan Patriot
Amerikan Patriot's picture

Until they get the dedicated Zero Hedge pumps installed, just tell them you'd like the "double price deal", okay? 

 

Sun, 12/21/2014 - 15:11 | 5578563 IndyPat
IndyPat's picture

Fuck you, Bob.

Sun, 12/21/2014 - 14:59 | 5578520 Oldwood
Oldwood's picture

The economy doesn't need cheap or expensive fuel, it needs stability, which is the last thing the casinos want. There are no bets if we can see the faces of the cards. Financial gambler types are loving this next, great, disaster.

Sun, 12/21/2014 - 13:56 | 5578285 TEOTWAIKI
TEOTWAIKI's picture

Well from my prospective here's what I saw:

First the arrogant Americans bragged and bragged like Texan oil barons that they had taken over #1 spot in the world for production of oil.

Arrogance: Strike One!

Then they hypocritically began bad-mouthing the Saudis for their atrocious human rights offenses.

Hypocrisy: Strike Two!

It remains to be seen now what the Texans are going to do to bring on strike three...

When asked if the strikeout was due to ignorance or apathy;

The reply will be, "I don't know and I don't care"

 

Sun, 12/21/2014 - 13:57 | 5578310 Everyman
Everyman's picture

Rooting for America to "lose"???

 

What state are you from?  Texas catches a cold, other states will contrac cancer in this manipulated mess.

Sun, 12/21/2014 - 14:36 | 5578443 TheReplacement
TheReplacement's picture

So you want this manipulated mess to continue or die? 

Sun, 12/21/2014 - 15:02 | 5578529 Everyman
Everyman's picture

/sacr Yeah, I want this manipulated POS to continue. 

 

/sarc off

That wasn't the point of the moron's cmment, or the article. IT is about how bad will the recesin  be whe we "revert to the mean" out of manipulation and the fact the majority of the oil/gas economy was build on very expensive or captal intensive technology or methods AND it was all financialized AND there are a pile ofderivatives on this crap.

So try aain junir, ths is really deeper than you can fanthom,

 Moron.  Think for yourself!

Sun, 12/21/2014 - 16:50 | 5578876 Amerikan Patriot
Amerikan Patriot's picture

Bob, I want you to get that GED before you continue posting, okay?  Your GED tutor will teach you how to spell, correct grammar and syntax, etc.

Give it some thought.

 

Sun, 12/21/2014 - 17:19 | 5578949 Everyman
Everyman's picture

Look, you have at least 2 if not 3 "accounts" and pretending you are more than one person, but it is a dead give away when you start with "Bob" on two accounts.  So who is the moron?  Amerikan Pat and Indy Pat?????  Are you that idiot from MarketWatch?  Finally get kicked off there and now come here, you freak?

BTW, "character assassination" is something the political class does and the uninformed voters, morons and idiots.  When you can't argue with the real data, you start with personal attacks.

Keep it between the ditches dumbass!

Food for thought!

Sun, 12/21/2014 - 13:57 | 5578312 Buster Cherry
Buster Cherry's picture

Thanks for the fucking tip JPM.

Anyone who lived here in the early eighties could have saved you the research hours you.

 

Fucking brilliant minds.

Sun, 12/21/2014 - 13:58 | 5578317 QQQBall
QQQBall's picture

So, I guess all the Californians move back and see higher home prices....

Sun, 12/21/2014 - 14:00 | 5578321 Inthemix96
Inthemix96's picture

The proles are awakening my friends.  When everything you have ever believed in was a monumental lie, backed by violence, it can be brutal to realise that you really did live through it.  With realisation comes understanding and a want to learn, and after that comes the inevitable realisation you have been fucking cunted off.

Lies, and ofuscation can often lead to violence.  When everything you thought was true isnt, it has an unusual way of focusing the mind.

Doesnt it?

Bitchez...

:-)

Sun, 12/21/2014 - 14:14 | 5578360 Inthemix96
Inthemix96's picture

If I could sepll I would be dangerous..

....

;-)

Sun, 12/21/2014 - 14:24 | 5578398 Inthemix96
Inthemix96's picture

I'm off out for the evening this beautiful winter solstice night for the christmas piss up.

I will leave with this and see you all fresh and fair in the morning.  Every action, has an equal and opposite re-action.  Some folks dont understand and to be fair I only take in so much, but understand this, you can only kick a dog so many times before he gets fucked off and bites you back.

This is that point.

I am sick and tired of being kicked.  Are you?       :-)

Take care Zhers.  If anyone deserves it, after years of putting up with this shit, you lot do.

Mix out.

;-)

Sun, 12/21/2014 - 14:02 | 5578325 Amerikan Patriot
Amerikan Patriot's picture

God bless America and cheap oil!

Sun, 12/21/2014 - 14:50 | 5578492 IndyPat
IndyPat's picture

Fuck you, Bob.

Sun, 12/21/2014 - 23:22 | 5580001 The9thDoctor
The9thDoctor's picture

Bob has bitch tits.

Sun, 12/21/2014 - 14:08 | 5578339 Amerikan Patriot
Amerikan Patriot's picture
CHAOS IN RUSSIA: People Are Panic-Buying Furniture And Cars After Ruble Crashes

The collapse of the ruble has forced companies operating in Russia to undertake extreme measures in an effort to remain profitable as the cost of imports skyrockets. And Russians have responded by panic-buying.

Fear over price hikes has sent demand for foreign goods surging as customers try to buy goods before the stores have a chance to raise the cost further. This has led to scenes not seen in the country since the late 1990s as people queued for hours just to get into some shops.

Even large multinational companies have had to take drastic action. Well-known brands such as Apple and IKEA have had to suspend sales and increased prices over recent weeks as they struggle to keep up with the falling value of the currency, while car companies including General Motors, Jaguar, Land Rover, and Audi have all suspended shipments to the country.

Russian shoppers trying to get onto the homepage of the Apple Store over recent days have been met with a "currently unavailable" sign:

The suspension came after the company raised the price of an iPhone 6 by around 25% to 39,990 rubles in an effort to offset the currency falls.

Meanwhile, those looking to do some Christmas shopping at IKEA this week were also disappointed. An attempt to increase prices forced sales of kitchen furniture and appliances on the Swedish retailer's website to be suspended until Dec. 20 "due to a large number of customers orders".

Shoppers posted pictures of panic-buying by consumers in Moscow on social media as IKEA was forced to close a number of physical stores.

McDonald’s has also moved to raise its prices with the cost of a Big Mac up by 2.2% to about 94 rubles, Bloomberg reports.

Across the country consumer prices having risen around 25% in 2014, due to a combination of the ruble crash and sanctions placed by the Russian government on imports from the European Union. Staples such as pork and sugar have risen by 25%, and the price of fish and seafood has also leapt up by more than 15%.

The pace of the increases has caused a stampede of nervous shoppers trying to buy up as much as they can before retailers hike up prices even further. Russia's 24-hour news channel RBC TV has been showing the scale of the queues:

Having touched record-highs of 80 rubles to the dollar and 100 rubles to the euro on Wednesday, the currency has strengthened significantly as the government and central bank appear to finally be coordinating their actions. It remains to be seen whether it will be enough to regain people's confidence in the stability of the currency and reverse the panic of the past few weeks.

Sun, 12/21/2014 - 14:50 | 5578494 IndyPat
IndyPat's picture

Fuck you, Bob.

Sun, 12/21/2014 - 17:13 | 5578942 Atomizer
Atomizer's picture

Bob is on Male Enchantment drugs. Just like Janet Yellen with the Federal Reserve ZIRP program. Just laugh.

Funny Smiling Bob Commercial - Male Enhancement

Mon, 12/22/2014 - 05:50 | 5580391 Grouchy-Bear
Grouchy-Bear's picture

Cut and Paste again and again...

Sun, 12/21/2014 - 14:12 | 5578355 SmittyinLA
SmittyinLA's picture

I have a term for Texas its called "Texas stupid", cuz they are, now suddenly they're going to notice they have a problem with Mexicans, millions that don't pay any taxes and consume lots and lots of resources and demand more taxes every year as they grow.

Sun, 12/21/2014 - 14:30 | 5578419 Buster Cherry
Buster Cherry's picture

I have a term for people "inLA" and it's called "California common sense" because they live in the most overtaxed, libtarded, communistic cesspool in the country (well there is New York), and there are people there that actually believe that Texans want an onslaught of fucking beaners here to overrun our health and educational systems.

Actually, the onslaught of fucking Californian's flocking to Austin is pretty fucked up too.

Sun, 12/21/2014 - 14:31 | 5578421 Everyman
Everyman's picture

California Stupid is what we are dealing with here in Texas, because of all the Californians moving here.

Sun, 12/21/2014 - 16:01 | 5578671 blown income
blown income's picture

Problem....Fuck that's all I saw when I went to Houston looking for work...

 

I am in the collision business and that's all the labor force is Mexicans or 99% and doing it dirt cheap..

I am not going to give all my years experience for dirt cheap..Fuck that!

 

Here in Lafayette where I live and lost my job due to a asshole from Washington state who was running the shop ...that was a red flag right there and I should have never moved back to Louisiana.

But economy was booming so it's my fault I should have stayed where I was at in the Carolinas but the higher labor rate I thought was a no brainer..  I FUCKED UP... now I am looking for work and Texas the rate is so much less cause of the Mexicans..

 

I am sure that Lafayette La will sink somewhat as well since this is oil and gas land...

What really passes me off is I can't get hired in the oil sector cause I am not connected ..

Lafayette building like Texas and the attitude is it can't happen here...

 

I am sure pink slips will be going out soon and they can join me collecting a whopping $247 a week in un employment..

 

Fuckers....and there pretentious attitudes...come back down to the real world mother Fuckers ..!!!!

 

Sun, 12/21/2014 - 19:46 | 5579366 Buster Cherry
Buster Cherry's picture

You should have more than one trade. Its a mistake not to.

 

A working white man in Texas, who pays his school and property taxes like me, does not enjoy the influx of Mexicans that have been allowed to overrun our State by those elected officials in Washington DC. No tears will fall from my eyes when those bastards get dangled from the streetlamps.

 

When the kids were in school, half the PTA meeting had to be in fucking spanish, nad looking around the auditorium, you knew that fully half the people would be arrested if the laws on the books were actually followed. I think about my school taxes paying for these fucking apartment dwelling parasites getting their little nino's and nina's educated in the school I paid for and continue to do.

Its how I make it through the day....that vision of decorated streetlamps....Mussolina style...

YeeeeeHaaaw!

Sun, 12/21/2014 - 21:58 | 5579809 falconflight
falconflight's picture

We moved from our adopted home Texas because of the huge property taxes.

Mon, 12/22/2014 - 09:14 | 5580564 Buster Cherry
Buster Cherry's picture

Yeah, with no state income tax they getcha with the property tax.

God help you if you get sick or laid off.

Mon, 12/22/2014 - 01:31 | 5580215 blown income
blown income's picture

I hear you...I can do other things as well ...just waiting for the new year...

 

 

Wanted to move to the Montgomery ISD area and by Lake Conroe general area...I have a 9 year old girl who is top priority.

Mon, 12/22/2014 - 03:00 | 5580303 cornflakesdisease
cornflakesdisease's picture

Yes, but we've dispersed them to your lovely democratic strongholds.  Enjoy.

Sun, 12/21/2014 - 14:16 | 5578370 richsob
richsob's picture

Oklahoma is headed for some tough times.  The oil business will suck.  The weather will suck.  And the Sooners are playing like shit.  Ask the average Okie what they want the most and it's almost a tie between another National Championship in football and $100 oil.

Sun, 12/21/2014 - 16:02 | 5578718 Uncle Remus
Uncle Remus's picture

."Oklahoma is headed for some tough times."

How could we tell? All the gov't giveaway agencies are busy busy busy. And that includes the new car dealers.

Fuck the Sooners and the schooner they rode in on.

And fuck the frackers. I am tired of my house shaking damn near every day. I'd have to take off my shoes and socks to count the number of new drill/production sites within a 50 mile radius of my house.

Sun, 12/21/2014 - 16:22 | 5578781 Uncle Remus
Uncle Remus's picture

Is my downvoter still butthurt OU lost Bedlam to OSU in overtime? Idiot.

Sun, 12/21/2014 - 14:33 | 5578431 Jack Burton
Jack Burton's picture

  "the U.S. oil and natural gas sector was an engine driving job growth. Eight percent of the U.S. economy is supported by the energy sector."

Well, in Russia it is 16% double the USA number. BUT, still, if Russia is smashed by a drop to this 16% sector of their economy, then the USA is going to take a hit 50% as hard as Russia! Think about that for a moment. The USA is laughing at Russia, when we will be smashed by a blow fully 50% as hard as the one sweeping Moscow. This number is large enough to hammer any bit of what passed for Real Economy growth here.

Oil is always Boom and Bust. I forget when, but many years ago, was it the 80's? Texas was rocked by an energy recession that crippled the state. As a young person I remember the nightly news channels running stories of job loss and dispair in the Lone Star State.  IF, oil stays low for 12 months, that will be enough for the rot to set in. So while Russia is rocked by a hit to 16% of it's economy, he USA is also rocked by a hit to 8% of it's economy. And face it, after health care and finance, the USA has precious little Real Economy, like energy production. In fact The Energy Sector Was America's great white hope, for real economic growth. Now that is shot to shit, by Obama, the Neoconservative Zionists and Saudi. America cuts off it's nose to spite Putin's face!

Sun, 12/21/2014 - 15:01 | 5578532 Atomizer
Atomizer's picture

Bet the J.R. Ewing type oil tycoons are laughing their asses off. IMHO.

Sun, 12/21/2014 - 17:04 | 5578915 JohninMK
JohninMK's picture

Its worse than that Jack. The ruble has crashed making Russia's exports cheaper so it could see a big increase in them.

In the meantime the $ has strengthened, making US exports more expensive. No-one seems to be factoring in that this oil price cut is going to result in a jobs/income smash across all US manufacturing/exporting sectors. Lower Mercedes SUV exports to Europe, lower chemical exports, lower profits for anyone selling a lot overseas like Apple, Cisco etc.

The chaos about to unfold is as much to do with the strength of the $ as with the weakness of other currencies.

Mon, 12/22/2014 - 03:00 | 5580301 cornflakesdisease
cornflakesdisease's picture

To bad Russia doesn't make anything.

Mon, 12/22/2014 - 01:41 | 5580228 delacroix
delacroix's picture

russia doesn't have tha massive junk bond financing problem.

Sun, 12/21/2014 - 14:41 | 5578457 kchrisc
kchrisc's picture

Texas, home base for the evangelical Christian, and Zionist neo-cons.

So no surprise, as they want the rural areas nice and angry. What better to support the neo-cons, and be willing to put on that new "brown shirt" of the ReadyReserve.

The banksters need to repay us.

While most of us were paying attention to their black bogeyman, they were creating a white murdering machine in the heartland. Better get caught up on "scripture," for the sake of survival.

 

 

Sun, 12/21/2014 - 16:24 | 5578656 Sturm und Drang
Sturm und Drang's picture

The truth and depth of this is difficult to grasp if you've not seen it first hand.

Constitution be damned.

Sun, 12/21/2014 - 14:53 | 5578506 Atomizer
Atomizer's picture

JPM found itself on the wrong side of bet. Grab me a tissue.

/sarc

Sun, 12/21/2014 - 14:55 | 5578512 Pumpkin
Pumpkin's picture

Well, hell, this is great news.  I figured it was the whole fucking planet.

Sun, 12/21/2014 - 15:15 | 5578568 IndyPat
IndyPat's picture

Hey, Bob?

Fuck you.

Sun, 12/21/2014 - 15:52 | 5578677 buzzsaw99
buzzsaw99's picture

I see more wind turbine blades going down the road than oilfield stuff.

Sun, 12/21/2014 - 17:05 | 5578918 JohninMK
JohninMK's picture

Not for much longer with oil at these prices.

Sun, 12/21/2014 - 16:14 | 5578753 Bunga Bunga
Bunga Bunga's picture

Demand for oil and oil products is decreasing. It's called a self reinforcing downward spiral.

Sun, 12/21/2014 - 16:28 | 5578799 CHX
CHX's picture

Texas chain reaktion of crude fall, I saw, a massacre.

Sun, 12/21/2014 - 20:57 | 5579631 lakecity55
lakecity55's picture

"And behold, came a Fourth Rider, on a Pale Horse! And Low Oil Followed him!
"What does this mean, Lord," I asked the Man."
"He has a sharp sword to cut the price of Oil all over the Earth. Many shall lose their bonds and credit default swaps! Their Iniquity will be seen as the worthless  paper blowing along the wind in the Walled Streets of Babylon!"

Sun, 12/21/2014 - 17:09 | 5578908 fatlibertarian
fatlibertarian's picture

i live in oklahoma city/yukon and it's under $1.88 a gallon right now.. never thought I'd see that to be honest. The question is - will the benefit of more cash in buyers hands off-set the negative of the job losses in the oil and nat gas industry if this keeps up? Actually, that's two questions - if it keeps up. Prices are probably so low here because we produce a lot of oil locally, yet these low prices risk hurting our economy as much as Texas's.

Gas Prices For My Zip Code: http://www.oklahomacitygasprices.com/index.aspx?&area=Yukon

- http://amazonpcbuilder.com for your pc builds.

Sun, 12/21/2014 - 17:22 | 5578963 Victory_Garden
Victory_Garden's picture

You bet there is a problem, it all stared at birth.

Reposting this for posterity purposes. Skip it if you have already reviewed the links.

KNOW where your first fear came from so you can go back to truly forgive it all, and then to consciously CHOOSE to forgive it all. Ponder every horrid action of abuse that causes every human being to react from the first conditioned fear response. Go back in the minds memory hole and truly forgive it, and then truly completely forget it all. Too much vital life force energy is wasted going back to remember the fears and to self-propagate them from the outer stimuli in the shitshow.

 

Hold your bets everyone. The show boating shitshow marches on.

Why does the head us traitor usurper soterobama puppet fly to Hi just before a false flag event on the mainland? Because it is a short flight to beijing china after that to go hide underground in the cities built there, and where all the rest of the filthy bankster pond scum trash is going to avoid all the fallout of a planned post NBC hollowcost.

All hands on deck for tomorrow, the 22nd. Anything can, or can not happen.

 

Shitshow defined: the act of clownyism in its nth degree of stupidity and nonsense spewed onto innocent and unsuspecting people, thus becoming the rare and absolute comedy it really is.

Here is a bright and shining example:

http://rt.com/shows/crosstalk/215863-turkey-nato-eu-policy/

 

Too farking much shitshowing going on!

 

We wake up as ego, and go to sleep as spirit.

When one sees right up numbers and truth spelled out so well here, all can KNOW these are the modern saviors in a real/unreal world. These greats are writing the history as leaders and Way showers, not being the slaves of those who would write your history for you. Be thou faithful until death, and you shall have a Crown of Eternal Life. Words never so true and if anyone has had after-death experiences, you KNOW this already.

Ask, what is a Secret of Life? Preparing for the next one. How do YOU Save YOUR eternal soul? By expressing your vital life force energies in good and righteous words, deeds, and right-up actions. Every action, has an opposite and equal re-action. Cause, and Effect. This is the Law engraved in the Stone of Eternal Time and nothing, absolutely nothing in mans or Thing's world of the money-god will ever, ever change that.

Sure would like to call them family names, instead of the other angrily expressed words, Mr. Rothschild, and Mr. Rockefeller sirs.

Bless'ed are the Way Showers, Great Teachers, and real Writers of the matrix's history in OUR time. See you on the other side!

https://www.youtube.com/watch?v=xwT_CdRWpb4

Compassion.: Forgive them Father, for they know nothing any better than evil. Yes, limited edumacation leads to limited reality in the unreality. There is sooooooo much beauty in the 3-D, and sooooo much abundance of soooooo much to share. Why argue when each and every one soul can have all they need to live happy, and self-sustainable lives. Compassion allows one to pat their little pointed heads and say, they just have just not been taught any better. Every child is born from a place of beauty, truth, and absolute Golden Light. It is where we all come from. Speaking specifically to the soul you are. What we become is a product of what is taught and conditioned into us as we grow up. We learn to become the world around us. The body is four basice elements of this 3-D world. You, are the fifth element that animates it all. The miricle of creation is, putting you the flame of spirit you are in a glass of water, and calling you what ever your name is.

Now, can you imagine nefariously and wickedly planning this and controlling the way every single soul on board grows up? Swack! That spank on your arse, and the first gasping breath, and the bright lights, and, it's sooo cold!!!, and, who are all these new looking things grabbing on to me and then, ahhhhhh!!!!, the sudden snip of the only connection to mom and the reality you just came from in the umbilical cord!!!...that final freak-out Yowwwww experience that becomes the very first harsh conditioned response of the new born babe. For most, not counting water births, this fear conditioning to manipulate the spiritual being you are is what most human babies experience, and is thereafter heavily monitored as it's slow-drip administered.

Ever see a Gellfling sucked dry of it's vital life force? See where this is going? Yes, FEAR!...and how it is nurtured and propagated for the rest of the living beings life time. Ask, who controls and uses fear to control you? How many vectors does FEAR!!! come from, and who is responsible for that propagation and flag waving fear? Is it the beauty, truth, or Golden Light Love of the World you came from, or might it be something else the Things have invented to control mankind? Hummmm...tings to ponder.

https://www.youtube.com/watch?v=xwT_CdRWpb4

REFUSE!!!!....to be a slave.

NOWLEDGE MANDATE: There is still time for true forgiveness and redeeming of soul accounts for those who have gone over to the darker sides of deviation from rationality, sanity, morality, and true human values. Your very acts of attrition and amends will be your own saving grace. Sink your ships of fools, and hop aboard the Ship of All Good Hearts. Let all true men and women SEE with the heart, and not the wicked easily fooled mind. Those that come over to the side of Truth-Light and God/Love will be welcomed and given moar truth and real knowledge to quench the ever seeking heart, and curious mind. You can still join the growing WORLD-WIDE CREW and sail with us all as the One we all are into a different kind of future. One where fair trade and rewards are given to all who work for them, world-wide. Prosperity can be yours, and not some money-junkie's in England, France, No. America, China, So. America, Africa, Antarctica, No. Pole, Israel, ME, Asia, underground skanky rat holes, or where ever else the money-god freaks hide out at. It is only a matter of short time before the world discovers what lies in those hidden vaults they have kept secret for ages, and in the recorded by themselves family histories of how these evil things rose up to world power like they have using the false fake not worth spit, money-god evil like they have.

Call them who or what ever, their numbers and names are known thanks to the world-wide intercepted NSA-documentation that has been accumulating for the last twenty years, or moar. Just about every horrible nasty wicked thing you can imagine could be done throughout history is written and told about in the rothschild family archives, and how they devilishly conceived it all, and then eventually created it in this, the latest epoch of man's history on the Planet Earth. They think just because they keep things hidden and away from the profane, it cannot be seen by Spirit. LATWTTB! All these Things, and the things they have done, are known about. You wanna know a secret? There are no secrets.

Those who speak about the Christ principle, or of a Higher Power that carries this hearts definition of Love, should first know the definitions of the words they use in haste, and treason. No perfection coming from these keys by far, and not even trying to flapi-doodle the ego all over the place. If you seek the Spirit of the Christos within, you will see it all over without. The Christ-degree is simply, awareness. There is NO one man greater than another on a planet where they are all born equal. The collective consciousness of the Etheric Whole contains All Knowledge. Getting back to the Golden Light is easy. Just connect with it in your heart place like you do with the Internet any time. Ask, and you shall receive. Eventually, and most of the time. If not, you better worry about being in karmic debt, instead of Karmic Credit.

 

Tidings of comfort and joy...spirit walkers unite on Sunday Night.

https://www.youtube.com/watch?v=FlfHyb397VY

 

Sun, 12/21/2014 - 18:06 | 5579078 Free Wary
Free Wary's picture

I downvote anyone with too many words. Get your own blog.

Sun, 12/21/2014 - 20:44 | 5579596 Victory_Garden
Victory_Garden's picture

In a field of roses, it is easy to see the weeds.

Free Love?

 

Sun, 12/21/2014 - 23:22 | 5580002 post turtle saver
post turtle saver's picture

gas, grass, or ass... no one rides for free

Sun, 12/21/2014 - 20:55 | 5579630 Victory_Garden
Victory_Garden's picture

Miner Correction:

KNOW where your first fear came from so you can go back to truly forgive it all, and then to consciously/subconsciously CHOOSE to forget it all.

Solly :)

Sum tings a need to be a right and are well worth repeating many times until it replaces the imperial conditioning of world-wide fear.

Tanks for yer positive contributions.

Merry Ha-ha...and Happy Ho-ho!



Mon, 12/22/2014 - 11:39 | 5580552 Comte d'herblay
Comte d'herblay's picture

U missed the part where the research proves that Attention spans have atrophied due to the Interweb, just as you have done with the Copy/Paste seconds it took to put up this undoubtedly 'remarkable' piece.

I DO have a secret, BTW, several as a matter of fact, that no one, now living, knows.

 

Sun, 12/21/2014 - 17:24 | 5578969 Atomizer
Atomizer's picture

You can allows renegotiate with the wave of illegal Obama immigration flow to pocket the new labor market.

Getting a day laborer from Home Depot

/sarc

Sun, 12/21/2014 - 18:14 | 5579098 roadhazard
roadhazard's picture

If the Saudis are destroying the competition then they have to keep doing it or the competition will just come right back.

Sun, 12/21/2014 - 19:41 | 5579109 falak pema
falak pema's picture

Shades of 1982-1992 crisis for the Lone Star State. I saw that one. 

Only difference is that creating the unilateral order today as Bush Snr did post Iraq 1, will be mighty difficult.

1°  China is not USSR.

2°  Outsourced jobs have created a new world and the US Oligarchy has lost its UNILATERAL comparative advantage. Those jobs will be very difficult to bring back.

3° For the USA to rise again (as it inevitably will, unless we all blow up), we need a new energy-ecological sustainable model. And that will take a whole LONG new while to make. 

The 16 th century was a game changer for Old Europe. It made it #1 with new world discovery.  So was the 19 th.

It made it global colonial empire until that paradigm blew up when top dog Britannica went head to head with Lebensraum seeking behemoth imperial Germany; aka when colonial empire building thieves fell out. 

We may be seeing a similar pivot back to East. But whoever finds that new paradigm will have a big competitive advantage.

Right now the West, aka Pax Americana, has a huge job ahead to not end up like old Europe did in that period from 1914-1945. An awesome slide into rubble, along with Japan. 

 

Sun, 12/21/2014 - 20:27 | 5579528 Omen IV
Omen IV's picture

its called  a cluster fuk and on top of that China just launched their first MIRV nuclear missile with 7,500 mi range

 

Sun, 12/21/2014 - 20:50 | 5579613 lakecity55
lakecity55's picture

"General! What are you doing?!"
"Launching our missile to blow up California."
"We just bought the place! Destroy the rocket!!"
"Yes, Premier Xi! At once!"

Mon, 12/22/2014 - 01:22 | 5580198 MeBizarro
MeBizarro's picture

Big deal.  They have MIRV technology.  That was relevant in the nucleur arms race in the 70s before SALT I and II.  

Sun, 12/21/2014 - 20:48 | 5579608 lakecity55
lakecity55's picture

We need a new arrangement. The Southern States should have a referendum on joining Crimea.

Sun, 12/21/2014 - 18:57 | 5579207 FreeShitter
FreeShitter's picture

Living in Houston is like living in LA traffic 24/7......Hopefully this oil bust comes soon so I can enjoy not sitting in stop and go traffic and these fuckers will go back to their home states

Sun, 12/21/2014 - 20:38 | 5579581 Son of Loki
Son of Loki's picture

I don’t think they’re ever going back. Austin and Houston have become pretty bad with all these out-of-staters, but it’s still better in their eyes then places like LA or Detroit. Unfortunately, all the locals have to suffer the congestion, traffic and soaring crime these folks brought with them.

 

Perhaps the slow down will halt the destruction/construction north of Conroe and west of Katy. Who knows?

Sun, 12/21/2014 - 21:40 | 5579751 lakecity55
lakecity55's picture

Man, when I was working for the French down there 10 years ago, Houston traffic was a trip. The on/off freeway ramps are like rolling the dice!

Austin has about gone Commie.

But I always loved San Antone.

Sun, 12/21/2014 - 21:51 | 5579788 847328_3527
847328_3527's picture

I have to go to Houston about 4 times a year and just about everyone, prob 4/5 people, I meet there has some thing to do, directly or indirectly, with O&G. My bet is on alot of hurt there, although I hope not for their sakes.

Sun, 12/21/2014 - 21:47 | 5579775 Arthur Schopenhauer
Arthur Schopenhauer's picture

As an aside, I live out around Damon in an acreage subdivision.  A couple just moved into the home next to us a couple of months ago and they had this bigass metal building built. I thought it was a bit strange to build such a large building... it's humungous.  Anyway, they invited me and my wife over for some brews the other night. We're sitting out on their back porch and I had to go to the bathroom. I said I'm going back to the house for a second and the lady of the house we were visiting says 'just use ours'. So I go inside and they have almost no furniture in the place. Instead it's piled high full of pallets of toilet paper, ammunition, food, etc. I go to the bathroom and come back out and I ask "Are you guys preppers or something" and he says "Oh yeah... come look at the stuff I've got in this big building I built".

Sheesh. I didn't know...

Well at least if he doesn't shoot me I know where I can get some food.

Mon, 12/22/2014 - 02:53 | 5580294 cornflakesdisease
cornflakesdisease's picture

Apartments everywhere and crazy rents.

Sun, 12/21/2014 - 19:16 | 5579250 HeavydutyMexica...
HeavydutyMexicanOfTheNorthernKingdom's picture

Come on Tyler, take it to the next level. Given the information in the article, what are some possible (legal?) strategies to profit from the impending tejas doom?

Sun, 12/21/2014 - 19:26 | 5579286 Everyman
Everyman's picture

Go long luncheon meats.

Sun, 12/21/2014 - 20:47 | 5579602 lakecity55
lakecity55's picture

Damn, construction trades are gonna have to low-ball Mexican wages!

"Hello, Bob and Tyrone. I am Rico, your foreman!"

Sun, 12/21/2014 - 20:48 | 5579611 Duc888
Duc888's picture

 

 

Long pig.

Mon, 12/22/2014 - 08:52 | 5580533 Comte d'herblay
Comte d'herblay's picture

Illegal works for me.

Sun, 12/21/2014 - 20:22 | 5579500 NubianSundance
NubianSundance's picture

Considering that too many countries are producing too much oil and demand is falling due to an ever steepening world recession why are people calculating on a basis of fifty buck oil when it will end up more like thirty or less. Take a look at the historic price of oil over the last fifty years, apart from the Iran Iraq war period the price was around twenty until 2000.

Sun, 12/21/2014 - 21:30 | 5579717 anticultist
anticultist's picture

In SW Oklahoma I see some big rigs going up along the interstate, who knows what spans out of view, I feel the fracking quakes

often. When I moved here 4 years ago, narry a car on the road when I went into the city or down into texas.

Now the roads are pretty busy, there is a visible velocity of economic activity, that was absent not long ago.

My retiring partner talked about north of OKC, Edmond, about all the young engineers with big houses and

big trucks, around where he bought his retirement home. Apparently these were the only paying jobs that occured over

the last 7 years.

All that and the economy still sucks, the restraurants are never busy around here anymore. I did a lot of spending

this year myself in a crack-up boom model, some long term products I figured on needing for the future, I got them

now while I still had a job and credit because that might not last long. I am now locked up again on any spending plans.

 

The plug just got pulled, almost like it was planned. The sharia Christmas massacre?

And that is why I rent and I do not contract with them, like property tax slavery.

 

I'm thinking the housing crashes maybe Jan-Feb. I think about the houses in my old hometown build $15-20k 70 years

ago, that can now sell $200-250k. And some changed hands and paid usury over and over again. All that monetary fraud (inflation)

and usury vaporizes, it is all slavery, theft of labor, that does not stand.

 

These houses should go back to $20k one way or another.

 

Maybe they would have sold some houses if anti-trust price fixing didnt prevent prices from going down with the labor class,

from retracing 20 years of monetary fraud and fraud taxation on inflation, since Clinton glass-steagle.

 

 

Sun, 12/21/2014 - 21:44 | 5579762 847328_3527
847328_3527's picture

The Houston Middle Class engineers [who make an average of $185k/yr according to the article cited in an above comment] are about to get severely punked by Barry's destroy-Russia-cheap-oil plan that is backfiring. With most majors already announcing a 'cut back' of 20-30% Houston will definitely [and unfortunately] see a big part of the layoffs. Layoff a bunch of Middle Class people making that salary in one city and Big Problem, esp for those who relocated there to Houston in the last 8 years and bought an overpriced Bubble house in an area of 3%-to-3.6% property taxes.

 

However, this seem par for the course along the path of Middle Class destruction we have been seeing in this country.

Mon, 12/22/2014 - 01:21 | 5580193 eucalyptus
eucalyptus's picture

Looks like they should've attended Wharton and joined the squid instead.

Sun, 12/21/2014 - 22:32 | 5579884 MeBizarro
MeBizarro's picture

You have to love the classic distortions in the graphs above especially the first graph where it has just 5 states including 2 very small states.  

PA's job growth has been pitiful and it is a big reason why Corbett got run out of office and was the first gov in PA's history to lose reelection since it allowed 2 terms for a Gov.  It also didn't help that Corbett too didn't pass an extraction tax on the natural gas drillers too which every other state in the union has too which essentialy was a $2-2.5B tax-free gift over the previous 4 years.  Natural gas lobby was Corbett's biggest campaign contributor in '10 and it paid huge dividends.  They have over a 1000x return for the campaign contributions to Corbett in '10.  

Not like PA is a blue state either.  Yeah PA may have vote Democratic for the President the past 30 years but there are uncontested GOP majorities in the PA House/Senate (and have been since '10), majority of the House reps are GOP, and the Senate is split 1 Democrat/1 GOP rep but the only GOP Senator who has lost a race in the state the past 40 years was creepy Rick Santorum in '06.  PA gets lumped in as a Blue State but it is generally a Red State.  

What the GOP should have done is passed an extraction tax on gas and then reformed the high business taxes in PA which are a real hindrance to small businesses.  Much better to just lower the overall business tax rate, stop screwing aroudn with credits, and not have the gov't pick winner/losers.  Instead, they followed national GOP policies and gave handouts to large corporations because the GOP are essentially paid whores for the US Chamber of Commerce.  Democrats have their own interests and both are whores to Finance.  

Mon, 12/22/2014 - 12:46 | 5580527 Comte d'herblay
Comte d'herblay's picture

Huh??  The two largest cities, Pittsburgh and Philadelphia with most of the human beans in the state, are RED????

This comes as news to Comte since every state contract, union 'negotiation' and manufacturing company employee, heath and education the two largest employee entities) wouldn't vote for a republican if he was the incarnation of FDR, whom they bow down to Mecca to worship 5 times a day.

Better check the population in those rural areas that are prolific, and red on a map,  but which mainly have deer, turkey, and racoons as inhabitants. 

 

 

 

Sun, 12/21/2014 - 22:37 | 5579897 MeBizarro
MeBizarro's picture

How you can possibly have an article about the Texas economy and not include trends in defense-related spending?  No other state (not even CA) benefits more from US military spending.  

Ft Hood is the largest Army base in the US currently, there are a ton of bases there (10 Army bases, 7 Air Force bases, and 4 Naval bases) no other major US city depends as much on US military spending as San Antonio, and I would bet bottom dollar that a hell of a lot more of Texas workers (private and public) are employed either directly by the US military or military-contractors/military-related spending.  

Sun, 12/21/2014 - 23:40 | 5580030 AdvancingTime
AdvancingTime's picture

How these lower prices effect a particular nation will vary and will effect both their currency and how competitive they will be going forward. The recent decision by OPEC members to keep their production ceiling unchanged has sent crude prices into a tailspin. Dropping oil prices add a new surprising new dimension to the stability of the world financial system.

While often heralded as a godsend to the economy and the end consumer we must remember lower prices hurt both producers and those in the business of oil exploration, drilling, and sales. The shale boom has been one of the bright spots in the economy in recent years and acted as a tailwind that accounted for much of America's growth. Expect this to come to an abrupt halt and with it thousands of jobs. The article below delves deeper into the economic damage lower oil prices can foster.

http://brucewilds.blogspot.com/2014/11/dropping-oil-prices-increase-risk-to.html

Mon, 12/22/2014 - 00:16 | 5580089 Youri Carma
Youri Carma's picture

What about capital leverage? Is that as high as in 1986? I think that is much higher now due to zero interest rate FED policy.

Excessive capital leverage is realy the culprit now.

Mon, 12/22/2014 - 00:43 | 5580142 DipshitMiddleCl...
DipshitMiddleClassWhiteKid's picture

all the deadbeats, fags and hipsters in austin are humming along

 

the real guys in houston and dallas and maybe san antonio to some extent are gonna be feelin this shit, man!

 

~DipshitMiddleClassWhiteKid

 

 

 

Mon, 12/22/2014 - 02:05 | 5580250 robnume
robnume's picture

I lived in Houston for a while. Couldn't have happened to a nicer state!

Mon, 12/22/2014 - 03:08 | 5580304 MEFOBILLS
MEFOBILLS's picture

Texas is not the same as other states.  During the housing bubble, new housing came on line fast enough to keep prices low.  Not perfect, but better than other states.  This means that personal debts did not skyrocket.  

Also, Texas is a no income tax, BUT with property tax state.  Property taxes keep people from bidding up property values to capture rental value.

 

For example, two bidders can bid on property to extract maximum rents, or whatever the market will bear.  The banker wins as the largest credit loan goes to winning bid.  Therefore the extra rental value is vectored to banker in form of usury, rather to government in form of taxes.

Texas runs its government fairly inexpensivley relative to other states.  It's legislature meets only every other year.  So any crap legislation has a hard time sustaining itself for that long of a period.  Any increase in government means increase in property taxes, which has high visiblility and is restraining force.

 

But, most importantly, private debts are not high, therefore much of the money supply is not disappearing to debt service.   The Texas economy is diversified, including high tech and will survive well even if fracking went away completely.

 

It would survive even better if Texas could direct its credit path into channels of production, but instead the extra state dollars are stored in Wall Street.  That is probably the bigger threat ... the lack of state credit creating power similar to North Dakota.

Also, Texas is getting inundated with foreigners and people from the other states.  A victim of their sucess, especially due to avoiding the ravages of housing bubble collapse and steering their economy well.

 

 

 

Mon, 12/22/2014 - 14:58 | 5581829 SmittyinLA
SmittyinLA's picture

TX has more COP debt than CA 

Mon, 12/22/2014 - 09:13 | 5580565 buystop
Mon, 12/22/2014 - 10:24 | 5580749 chomu
chomu's picture

Selling short my lot of King Ranch F-250's.

BTW, f*ck the Cowboys and especially F*#k Romo. They'll lose in 1st round.

Mon, 12/22/2014 - 10:28 | 5580764 B190769Sonny
B190769Sonny's picture

As others have mentioned, I too have been following the eia numbers since late 2012.  US Gasoline Retail Sales (Thousand gals per day) has declined 41% in the past 2 years.  Fuel efficiency, bad economy...are the numbers bs.....who knows? My opinion is that this is all a ploy to raise taxes.   Right now the US gov pays 18% of Annual receipts for interest on the national debt.   Yellen has already commited to raising interest rates sometime in 2015.  Current US borrowings are predominately short term because of the low rates (aka < .25%).  As Yellen increases rates, it has a dramatic impact on interest costs on the national debt.  It took the USA 204 years to accumulate our 1st Trillion in debt (Oct 1980).  It took the the USA 400 days to go from $17 Trillion to $18 Trillion (Oct 13-Nov 14).  The ploy to increase rates  plays to the "Bread and circuses" mentality (maintaining the welfare state for as long as possible).  Keep the welfare state happy with pseudo prosperity, a rising stock market, and low gas prices and they won't mind a $0.16 per gallon tax increase.  Eventually, the house of cards will fall.  Based upon today's trajectory, sometime around 2024 interest costs on the national debt (which will then be around $25Trillion) will exceed 70% of gross revenue.  

History:  Rome at its height had 1 million citizens.  As the Roman Empire declined (devalution of the denarius, politicial ideology, taxation, crime, etc), more of its citizens sought a  better life and left Rome.  Eventually, around 400 A.D. a rogue country conquered Rome and its 50,000 remaining citizens. 

My pont:   The world is in major turmoil and debts, wars, and economic injustices can not be sustained much longer.            

Mon, 12/22/2014 - 11:37 | 5580992 numapepi
numapepi's picture

I mostly agree with all of the above. I would like to point out that the US debt will far exceed 25 trillion by 2024. The debt will reach that milestone much sooner. If we project the debt curve at the present rate as a parabolic curve not linear it gets to 25T much faster... 2020 or so. By 2025 we will be going into deeper into debt at almost a trillion a month.

Assuming we last that long.

BTW, Discourses on Livy, by Niccolo Machiavelli is a great book on the fall of the Roman empire. Machiavelli argues that it was the use of mercenaries that was the final nail in the Roman coffin.

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