Friday, March 4, 2011

We're here

Oil continues to roll.

"Peak Oil" is soooooo passe... and past tense. The phrase itself is now firmly entrenched in the popular lexicon, if not in government and banking's. The implications of the issue are just so overwhelming that even the vast majority of highly intelligent and well educated adults just doesn't know how to address it. Believe me, they would if they could - but that would mean coming to grips with ALL of this phenomenon's implications.

I am speaking about people my age, of a certain age if you will, with offspring that are now young adults. Our issue need our guidance and direction at this critical juncture... and where, and how, are we directing them? In a direction that takes no account of what the absolute certainty of what Peak Oil means.

The new generation of young adults will need the same things that every new generation has needed: A home, skills to make a living, and skills to operate a family unit and within a community. Yet my generation is still pointing our young into educational endeavors that will yield no practical skills but will leave them with debts sufficient to prevent them from acquiring a debt free home BEFORE they reach a certain age (just ask any 60 something person who still has mortgage debt AND a 5 figure property tax bill how his financial health is affecting their physical health).

To be fair, "Peak Oil" likely times well with "Peak People"... and in a Peak People scenario, some folks by mathematical necessity must remain childless and houseless.... but we are talking micro solutions here (you guys know how I feel about macro solutions)... and if you want grandchildren (and I really do), this is a time to pay close attention to your personal forecasting models.

Family businesses and family farms et al, are going to matter a great deal in the financial planning of the future. Financial assets? Beautiful now but could be quite ugly later. The small family business might well be today's "ugly duckling". For middle class millionaires spending $200k on an undergraduate degree in liberal arts, irrespective of prestigious the institution, might well echo painfully for a couple of generations.  A modest, debt free home will "echo in eternity", as will practical skills in everyday life. Engineer, dentist, leather worker, horticulturist? Mazul Tov! Sensitivity coach, journalist (rofl!), english prof (really rofl!), political activist (really, really ROFL!!!)? Oy. "And from that you make a living?'

We're "here", and we've been here for 3 years + or -. Things will evolve just the way they do, and at the pace they do... this will present great opportunities and great challenges, and the beer will still be cold, and waves will roll in, and life will always be good - even hard times... hard times are better than no times, if you catch my drift.

Oh, and one last thing... given the future for transportation fuels, if you want to have any kind of relationship with your adult children and their children you gotta think long and hard about just how far away from the family compound the college they attend is. My wife came hear from Asia as an exchange student... and now her parents have to travel 9,000 miles to see their daughter and their grandchildren.  How much longer do you think that model will work?


Anonymous said...

I live within 10 miles of my four children. We have two adorable grandchildren. My wife and I would LOVE to move to a warmer clime, especially after this miserable winter. It is NOT going to happen. Gotta keep priorities straight.


Coal Guy

kathy said...

My son has decided to bag grad school (TG!!!) and is coming home to live in April. I'm mighty glad to have most of my kids within spitting distance. We help with some child care. They still have strong backs and willing hands. We supply eggs and produce, pork and honey. They are always willing to lend a hand. I love my DILs. Life is good.

Greg T. Jeffers said...

Coal Guy;

Family planning has many aspects to it besides how children one might have... you've got the right idea.

Hey Kathy:

Grad school is right on for Dentists, Veterinarians, surgeons, some engineering specialties... but for psychology? LOLOLOLOLOLOLOLOL!!!!!!!

You folks are all set.... there are alot of folks out there that are being manipulated by all sorts of special interests - to the severe detriment of their family. They need to hear another point of view.

Dextred1 said...

Normalcy bias is still the phrase of the day. All hell is going to break loose and nobody is ready.
Except a few silly bloggers :)

Anonymous said...

What really disgusts me is that the people being used the most are those least able to detect or deal with it.


Anonymous said...
Bonga Down. There goes another 225,000 barrels.

Donal Lang said...

Greg: You say Peak Oil is mainstream; maybe its different over there but here in Europe, its really not. If I am lecturing any group; business people, 16 year old students, uni lecturers or just general public, if I ask how many people know about Peak Oil I'm lucky if 5% put up their hands.

I think we tend to mix with people who share the same interests, so because all the people we know share knowledge and concerns, we assume the RotW does too.

I'l put the average Joe (and Joanne) with the bankers and politicians on this. There's still a job to do.

Anonymous said...

I don't find most people I speak with peak Oil aware. Most I speak with tell me that the US has trillions of barrels of Oil that we don't tap into b/c of the environmentalists and that we can somehow magically produce 7 billion barrels domestically within a year or two if we just "wanted to". I get email forwards to that effect as well. I have two friends that have been aware of the many implications of oil decline and cheap oil upon civilization and the US and other dependent countries in particular.

I'm always amazed how quickly people are to attach their support to magical thinking that supports their biases or desires to avoid all cognitive dissonance.

westexas said...

My "Iron Triangle" thesis:


The prevailing message from some major oil companies, some major oil exporters and some energy analysts can be roughly summarized as follows “Party On Dude!”

Meanwhile, over on the other two legs of the Iron Triangle, the auto, housing and finance group is focused on selling and financing the next auto and house, and the media group just wants to sell advertising to the auto, housing and finance group. The media group is only too happy to pass on the “Party On Dude” message to consumers.

To some extent, what we are seeing across the board, from large sectors of the energy industry to the auto/housing/finance industry, media and beyond, is the "Enron Effect," i.e., many people know that we have huge problems ahead, but their paychecks are dependent on the status quo.

The suburbanites are caught in the middle of this, although they have a strong inclination to believe the prevailing message from the "Iron Triangle." As in the movie "The Sixth Sense," for most of us the automobile based suburban lifestyle is dead, but we just don't know it yet, and we see only what we want to see.

Anonymous said...

I have living proof that the suburbs are dead. I purchased a home in the outer suburbs of Atlanta in 2006. First I watched as the value dropped from $200k to $124k.

Then 2008 happened. Not only the downturn in the economy and the markets. But also the record fuel prices made worse by a hurricane that hit Huston and created significant scarcity here in the Atlanta metro area.

People are bailing out of here so fast its not even funny. A home just down the street just sold for $78k a few weeks ago. This place really is turning into the slums.

I've got the message loud and clear.

Greg T. Jeffers said...


Perhaps you are correct... I can say with confidence that among the finance community that it is in the popular lexicon.

PioneerPreppy said...

I would certainly say the overall general opinion about peak oil around these parts is that there is plenty all over the place and the government and especially big oil companies are manipulating the price.

I think most average people cannot wrap their minds around billions of barrels any more than they can around trillions of dollars.

Anonymous said...

The general public has no clue that there might be a problem. The common refrain is “they’re screwing us.” where “they” are either the oil companies, middle easterners, speculators, or some combination of the three. Heck, I have even noticed a reappearance of “Kick their ass and take their gas” shirts in online ads. Talk about mind numbing ignorance. Most people walk around with blinders on, refusing to see what’s staring them in the face. Of the ones that do pay attention, the great majority are functionally innumerate, so the implications escapes them.

If you want a good gauge of how far PO has penetrated into the population just look at what they are driving. SUV’s are back in vogue and one of the local B&R attorneys (bankruptcy & restructuring) is now driving around in a F650 XUV. Apparently the recession has been good to him but he is obviously oblivious to the oil shock that triggered it. If anyone could be expected to know the relationship between poor decisions and bad consequences, it would be him; yet here he is driving around in a medium duty commercial truck converted into an quarter million dollar, uber gas hog, SUV on steroids.


Anonymous said...

Corrected link


Anonymous said...

You central coment is dead on. I have a really good liberal arts degree. It is the real degree I am proud of.

If you don't spend the 200K and owe money, could be worth it or have real financial aid.

Got it 30 years ago. Alot of doors were not open to someone with pull and connections with this kind of edcuation.
Out of the gate I knew I needed modest paid for home with reasonable taxes. Makes all the difference in the world.

Please let me add the car is another very important item that needs to be paid for and best paid for in cash and kept running with salvage yard parts, wholesale online parts and ebay parts. Our family has the skills to do rather complex repairs and we have a family motor pool to draw from if something happens to a family members car.

We are now working on hardcore energy conservation. It is nice to have electricity, ranning water. But we are planning to drill a well ourselves as well as a modest solar back electric system for either hard times or black outs.

Lat but not least for the house learn and do the building trades to keep it very well and spend little cash to do it.