Thursday, February 27, 2014

The Re-Birth of the Small City

Here is an interesting article about the future of cars in our society. The end of the automobile is in sight. Certainly in the lifetime of the Millennials. Maybe in the Life time of the last of the Boomers/Gen X'ers (like me). Oh, there will still be some cars around... but not very many (compared to now) and there will be a whole lot less driving going on.

(And for your corporate cubicle drones, something to consider.)

It is a mathematical necessity that as fuel availability declines (forget the price for a moment) that total vehicle miles will decline (even with increasing efficiency - it is simply not possible to replace the installed fleet in less than 15 or 20 years, and it will prove far more cost effective to simply drive fewer miles and keep the ICE car you have than to buy a new, more efficient vehicle. The less one drives the longer their vehicle will last (as measured in time) so my bet is that instead of a turnover of the fleet in 20 years, the fleet will last longer and drive less... but I reserve the right to change my mind!).

That means commuting is dying (Can I get a Halleluja???!!!!) and with it Suburbia... and the death of Suburbia means the rebirth of the livable, small city. Of course, we don't have many of those here in the U.S., but we will.

(I can think of no worse investment than single family housing dependent on automobile transportation. NOTHING could possibly be worse. I know perfectly rational, intelligent, successful people buying up houses in suburban developments in places like Florida and Texas... it is painful to watch. Want to buy Real Estate? Downtown. Center city. And even then, you need an eye for the future and a bit of luck.

Worse. I cannot imagine trying to evacuate, without cars, 8,000,000 South Floridians in the face of a catastrophic hurricane/storm. Think about that for a minute. Think what it would be like (for the survivors; and then think about the loss of life) in the aftermath of a hurricane in a low lying area in which 8 million people live and where there are 2 train tracks in and out. Are there that many buses in the U.S.? Would we use them every time we had the threat of a storm? I shudder to think of the post event living conditions for a metro area literally 20X the size of New Orleans with a Katrina type storm. This is not an investment opportunity; it is a trap - and a very dangerous one at that.)

When I say "small city" I am not talking about a million person plus metropolis which looks small next to New York or Sao Paulo. Most of these were designed and built around the automobile. No, I am talking about livable cities that have been arranged around walkability and public transport. That counts out Houston, Miami, Nashville, Ft. Lauderdale, et al...

So who's left? There are lots of them... complete with walkable downtowns and conceived with trollies and such in mind.... you've just never heard of them. Some of them you have - Savannah, Ga. Richmond, VA. Concord NH., but for the most case no.  There will be great opportunities to make a fine living and to live a fine life - provided you are not spending 10 years of your life unwinding the dead weight in your pockets invested in "a way of life that has no future" (to quote James Kuntsler).

But there is another process going on here.

Crime really does not pay any more. Technology destroyed the Mafia in New York, and it is in the process of destroying the inner city thug element. People can (now safely) move back to the cities, and the cities will be infinitely safer without cars zipping, in close proximity, past pedestrians (especially children. Remember those?) at 55 mph.

(There will always be crimes of passion, and nothing can be done about that irrespective of how much those that want bigger law enforcement budgets try to scare the sh#! out of the easily scared; there will always be crimes committed by the really stupid, and the mentally ill, too, but the rest of the population understands with great certainty that they are being tracked, that DNA, cell phone triangulation, and video cameras, and financial transactions (who uses cash anymore?) create a never ending alibi or link you to the scene of the crime. Just watch a movie about/involving (a) crime from just 10 years ago... it is almost laughable now!)

Like it or not, this is the environment we live in. Drones will be replacing police officers just as surely as they are replacing fighter and bomber pilots as well as boots on the ground (I think the idea of paying for a "criminal justice" degree (SNICKER) is a poor use of capital). I used to hate the idea of this. Some of it still scares the sh#! out of me. But on further reflection, much of the abuse of those in the system (not all) is being removed. I absolutely LOVE dash cameras on police vehicles and look forward to cameras on the lapels of police uniforms. If I have to choose between being watched by a camera or an individual that wants to carry a gun and is willing to use that gun on a human being for non-violent crimes I will take the camera every time. Of course, it is probably not long before those "cameras" are also armed, but at least the person operating the camera cannot claim that he felt his "life and lives of my fellow officers/"cameras" were in danger", so I had to shoot the guy that we were called on to render assistance to". There are some benefits to drone technology as well as costs.

As people move to cities and give up cars:

  •  Citizen interaction with armed government extortionist personnel (the police) will decline precipitously - and with it the expensive burden of this government "service". Those nice people can see just how valuable they are in the mart of competitive commerce.
  • Traumatic brain, spinal, and other injuries now common place for commuters and drivers will not be the burden to society that it was. Deaths in car crashes will decline.
  • Pollution, particularly of the air, will not be the issue it was... especially if we can get over the idea that we need 5 bathrooms for a family of 4.
among other positive development. There will be some tough transitions for certain segments of the industrial landscape. Think Detroit.

Better days ahead.

Wednesday, February 26, 2014

A "4" Handle

For the first time in decades, U.S. net petroleum imports is sporting a 4 handle for the week (very bottom, first number on left - 4,825,000 mbpd). The 4 week average is the lowest that I can find, too, at   5,321,000 mbpd (not by much, November was 5,344,000 mbpd net petro imports).

I know domestic production is up for the 4 week period year over year about the same as imports are down (easily found on that table)... so the system is balancing via an $11 per barrel price increase since this time last year... it then follows that all of that cap ex spent by the domestic E&P industry kept price increases to only $11 per barrel?


The U.S. leads the world in criminalizing acts that its citizens had no intention of committing? We really need to do something about this.

This is ALL about government budgets.

Crime is in free fall in the U.S. While Law Enforcement is nearly breaking its arm patting itself on the back, this has almost nothing to do with "better policing strategies". The vast majority of the nation's violent crime is in just over a dozen counties. DNA, Technology, Smart Phone Tracking, Ubiquitous Security Video, et al, has made it impossible to get away with anything. People are not stupid. They know they are being watched. The police know they are being watched. So everybody has to be nice.

So cut the budgets already.

Sunday, February 23, 2014

To the Heart of the Matter

The tumultuous 20th Century came to a close in the giddy environment of the "internet boom". While the Web has caused some to be incredibly wealthy its real and lasting effect, me thinks, is that it has caused the demographic of informed people to surge. Of course, propaganda efforts have also been employed to sway the opinion and develop belief systems in the less intellectually gifted demographic but I think that though this demographic has the more votes it cannot match the power of the informed.

The internet still holds incredible promise to free us of the drudgery that evolved from the Corporatocracy. Meme's like this show up on a regular basis on my FaceBook news feed:

Clearly, many understand the inconsistencies regarding our well being, satisfaction, personal growth, and humanity of this situation and condition. The fact that the collective "we" continues on in a life arrangement that we find questionable is a topic worthy of examination.

I think the "we" needs a definition. I would suggest that ethnicity or religious affiliation is not who "we" are as discussed here. I think "we" are the heirs of a system of "property rights" that evolved in Europe beginning with the early Roman Empire but which really took off with the advent of Feudalism. The crazy thing is that in real terms, not much has changed.

There is a Meme going about in the Libertarian circles that I travel in that the early U.S. was an egalitarian and equalitarian place for people of European ancestry. Nothing could be further from the truth. More than half of the European colonists arrived in the Colonies as indentured servants. Their lives and living conditions were essentially the same as the those of the African slaves, though most would eventually regain their "freedom", if you want to call it that. The fact is that in 16th Century Virginia less than 50 families controlled all of the land and all of the power of the State. The meme that John Locke, the hero of Thomas Jefferson, was a benevolent, just, and impartial supporter of the idea that all men were created equal is hardly supported by the facts on the ground at the time. Locke was more of the "some animals are more equal than others" stripe.

But I digress.

The convoluted process that has evolved for defining "property", especially intellectual and abstract property, will needs be reexamined (me thinks it will happen one way or another) along with the brutal fact behind each violent war/nationalist/ideology death of the 20th Century - with all of these killings committed in the name of "national interests" but were really just the use of murder to aggregate oil, coal, copper, timber, land, water, etc... into the hands of the political masters of the time -  must be tallied on the "cost" side of the balance sheet. Yet that exercise seems never to be done precisely because all the individuals that paid that cost are dead. This is "Survivor Bias" at its finest.

The Web holds such promise in all of this. The idea that it is sill necessary for information workers to assemble in office buildings in order to labor effectively is being undone, much as the idea that students need to assemble at college campuses in order to study the Liberal Arts (of course this does not apply to car mechanics, for example. They will still have to commute to work in order to share in the capital goods required for the trade). The idea of working in a particular physical space for the purpose of earning enough to maintain the physical space (your home) you left empty that morning and to risk your life and limb traveling in a vehicle at speeds that the human body cannot withstand the force of (in a crash) as well as to pay for the maintenance of that instrument (your car) cannot be undone quick enough, me thinks. But it is being undone.

(Of course, for those that have only known one paradigm, the shift to a different paradigm (I can't believe I am using "paradigm shift" here... so 1980's of me) can be disorienting and stressful, especially since many special interest groups will use the media to scare the daylights out of certain demographics, but I think on the whole we stand to make real progress in the quality of our lives when compared to the lifestyle expressed in that meme photo above. How the banking and commercial mortgage system responds to the loss of the sunk costs of empty office space - many office buildings will simply become "stranded assets" and the mortgages and property taxes associated with these properties will simply go unpaid - will, I think, prove to be a very difficult problem to work out. Think about Detroit and apply that outcome to most of the office complexes in suburban America - and the impact to the banks of the loss of those mortgage assets as well as the secondary impacts, such as the local support businesses for those office parks.)

Think of what "capital" is in our system: "Capital" is an abstract license controlled by the establishment class and conferred upon those accepted by the establishment to aggregate and control the natural resources that make the "real economy" run. Simple as that. Want to dig a gold mine? Drill an oil well? Buy and operate a commercial fishing boat? Run a dairy farm? Open a "Technology Start Up"? You will need the permission and the approval of the establishment (they control the banks, venture capital, and hedge funds) in order to gain the "capital" required to do any of these things. The establishment exercises a number of methods to control who among the population is granted this "license":  Occupational and professional licenses. Bona Fides. Qualifications. Of course, Web entrepreneurs were not bound by these limitations and accordingly ran around these limits to construct their own "establishment", which is now being inculcated and assimilated by the original establishment. My sense is this is all for naught. The Corporatacracy's control mechanism of knowledge and information workers will be strained in the extreme when these people are no longer forced to commute to the office.

(There are 2 forces at work here: The Petroleum used to commute in that meme photo above is in permanent decline in the U.S., AND; technology is making commuting unnecessary for a number of workers.)

Once the umbilical chord from the "office" to the "employee" is cut, there will be no reattaching it. The "employee" will be free to make more than one "arrangement" for his or her skills, they will be paid more because without the expense of the physical plant of the office they will cost less  per unit of production, they will have more disposable income as the costs of business dress and commuting will decline, and they will have a great deal more free time because as anyone who has ever worked in an office as an "information employee" (or their support staff) knows only a few hours of each day are actually productive and the amount of time spent commuting is usually more than the time spent in productive work.

As the availability of transportation continues its inexorable decline there is lots of low hanging fruit to pick that will improve the quality of our lives immeasurably. The issue for the banking/financial system and those interested in expanding credit/money supply is that the demand for vehicles, retail space (think of the future of "retail" in this new world!), office space, a number of other commercial space types is going to go down like a rock in a pond, and with it the need for credit to finance that stuff (sh#!). While I think the financial system will shake, rattle, and roll I think that there is every opportunity for a better set of circumstances and arrangement as an outcome when compared to the current circumstances and arrangements.

(And it could very well be suburbia that goes valueless and the city office buildings are reconfigured as living space.)

Wealth, property, and capital will go through a period of redefinition. I am very curious to see how that turns out because I hope that this new arrangement and the expanded "enlightened class" will not tolerate the enslavement of many for the benefit of a very few. With a little luck, the increasing enlightenment brought to us by the Web will assist us in this endeavor.

I think (hope?) that the Web is the new "Vienna" where this debate will take shape rather than in the corridors and halls of the structures owned and operated by the establishment for the establishment, and; let us hope that we get this done without pulling a Ukraine, which, while quite possible is also completely unnecessary.

Friday, February 21, 2014

Oil Tanker Daily Rates Tell the Story

After noodling the "where is the Oil" (from my previous post) if the U.S. is not importing it I figured that the tanker market would point me in the right direction. After reading this, I think we have our answer:

Something BIG has happened in Export Land. Really, really BIG. Don't bother looking through the EIA or IEA data. Their data simply cannot be correct if the shipping data reported here is accurate. I have much more faith in market driven daily rates, ship scrapping reports, and ship reported imports into the U.S., China, and the E.U. than the unaudited supply reports issued by the EIA and IEA. 

Daily earnings for the vessels, which haul 2 million barrels of crude, averaged $7,296 since the start of 2013, according to London-based Clarkson Plc, the biggest shipbroker. That’s the lowest level in Clarkson data that begin in 1997.

$7,296 won't even cover the insurance bill.

Rates plunged as much as 97 percent from their December 2007 peak of $229,484 a day as the surge spurred the most orders for new ships since the 1970s, just before the global recession began. That generated the biggest capacity surplus since the mid-1980s and drove Overseas Shipholding Group Inc. (OSGIQ) and General Maritime Corp. to seek bankruptcy protection. Freight swaps traded by brokers show rates won’t exceed Frontline’s break-even cost of $25,000 before at least 2015.

"Just before the Global Recession began"??!! Or just before Peak Oil/Peak Oil Exports occurred?

More from the article:

“It is on the ships’ supply side there is an imbalance,” Singapore-based Jensen wrote in an e-mail Oct. 2. “The only way to clear that is to remove tonnage -- scrapping is the way forward.” 
U.S. imports, representing about 14 percent of oil carried at sea, averaged 25 percent less this year than the peak in 2005, Energy Department data show. The nation’s crude outputis at the highest level since 1992 because of increased extraction of reserves found in shale-rock formations. 
The capacity glut is being compounded by contracting U.S. and European oil imports and the slowest expansion in Chinese purchases since at least 2005. The three account for about 52 percent of demand for seaborne crude, according to Clarkson.

"Scrapping is the way forward"??!!  From order to delivery a tanker is a 2 to 3 year project. Clearly the industry is aware of Peak Oil/Peak Oil Exports.

More from the article:

China’s imports this year are 3 percent higher than in 2012, poised for the smallest increase in at least eight years, customs data show. The nation’s economy will expand 7.4 percent in 2014, the weakest growth in two decades, according to the average of 57 economist estimates compiled by Bloomberg. 
The 28-nation European Union, representing 24 percent of demand, will import 2 percent less oil this year, the equivalent of about 18 fewer supertanker cargoes, Clarkson data show.

That answers my question from my previous post. The U.S. importing much less Oil in 2013. Nearly 2 million bpd from January compared to December... and China's net imports are only +3% while the E.U is a negative 2%? With Brent averaging over $100 for the year? I have a great deal of faith in these data points because I know that Bloomberg (the company, not the mayor) protects its trader franchise at all costs and is freakish about fact checking. You are free to doubt them.

Europe imports only down 2% yoy??!! Anything is possible, especially given how bad the 2012 yoy decline was... but I am skeptical. 

I am calling it here. Oil Imports into China have topped or will top in 2014. Upheaval to follow, most likely over food prices. The U.S., Japan, and Europe topped in 2005. Argentina is now an importer, and is the next Arab Spring/Ukraine. 

The exporters have the price incentive to produce all out, and it is my bet that they are doing just that - and Oil imports into the U.S., Japan, and Europe will only continue to decrease from here. It can't get much worse for the U.S., another 2.3 million bpd of imports and its all over - only Canada and Mexico will be left. And Mexico's 350k net bpd is over in 5 years. Maybe less.

Fracking Schmacking. The wheels are about to come off of a number of wagons. When China stops growing look for Copper and Steal to get crushed. My sense is Coal, too, but I am less confident about that. That means Chile (copper) follows Argentina into Ukraineville, and Australia is toast. Mexico becomes a failed state for real. Looking at the rate of decline for Oil imports I think this all happens relatively soon. Maybe tomorrow. Maybe next year. Not 5 years. Lots of opportunities in all of this.

While the U.S. (and Russia) is in the best position of all the major players (some might argue Russia but they would be wrong, me thinks), the rate of change here in the U.S. will, in my opinion, be a "and the folks was freakin'!" moment. The U.S. has big Oil production, Natural Gas, and Coal resources. We will get by, for now, but the financial system/markets as we now know it will not survive this. Simple as that. Inflation or Deflation? Could go either way. Tell me what the Fed's response is and I will give you a firm answer.

The key is to enjoy the ride. This should be exciting.

Thursday, February 20, 2014

It seems that something happened to World Net Oil Exports

Oil imports into the U.S. in 2013 fell rather briskly with the percentage rate of change increasing as the year went on. For Q4 and January 2014 Oil imports are sporting a 5 handle (5.6, 5.33, 5.5 million bpd for Q4 and 5.6 million bpd for January).

Oil prices have risen to over $110 in the world markets and $103 for WTI.


It then follows that if the exporters had been exporting as usual that some of the other big importers would have experienced a significant rise in imports. Only it did not happen.

The first place to look would be China, then Japan (actually, Japan is a bigger net importer), India, Germany, the Netherlands, South Korea, France, Singapore, and Italy - in that order.

Hmmm... China's yoy increase for 2013 was 4%. The (alleged) missing Oil does not seem to show up in Japan. Maybe India? I can't tell as data is only updated to May, 2013. From the article:

The change in net fuel imports was driven almost entirely by higher exports, with outbound product shipments rising to about 570,000 bpd from 2012's 484,000 bpd, while product imports were largely steady. 
Taken together, net crude and fuel imports last year were 5.83 million bpd, up about 160,000 bpd, or 2.8 percent, from 2012's 5.67 million bpd.

Germany imports are down, as are France and Italy (they are in Europe and Europe is having a h**l of a time). Netherlands, Singapore, and South Korea imports were flat using date that might be a bit old... but they just are not big enough to move the needle in any event.

So... did the exporters just export less Oil? If so, why? Prices are firm, well over $100 for Brent for 2013 and January 2014 so it isn't like "demand" (read: "desire". Demand can never exceed supply) was not there... or am I missing something? Look, if the U.S. cut its imports, either the exporters cut their exports or the other importers increased their imports. Its a zero sum game, and we are talking 500 million+ barrels here over the course of 2013. That's a lot of oil. $50 Billion smackers worth if Oil is $100.

The data for all of the other countries are not up to date, but the U.S. data is, and the U.S. imports fell nearly 2 million bpd from January to December. If the the exporters remained constant someone (some importer or importers) should have a bunch of oil/refined products in their storage facilities or some seriously increased total vehicle miles traveled internally.

What gives? Anybody?

Saturday, February 15, 2014

Living in a State of Fear.

"Man is born free, but he is everywhere in chains" - Rousseau

Every day, the average American - with an average IQ of 100 (meaning they can pass the written DMV test on 70% of the attempts) - is inundated with media manipulations designed to produce anger (anger is the easiest reaction... for some reason people can express anger much more quickly and with greater intensity than they can empathy. The same seems to me to apply to the ratios of jealousy/love, requesting forgiveness/offering forgiveness, negative thoughts/positive thoughts. I wonder if this is existential? Or is this part of the unintended consequences of media saturation or religious indoctrination?) with statements of half truths and outright deceptions.

Here's a couple obvious examples.

A favorite of the Left: The U.S., a massive country geographically, with a large population is often compared to countries like Norway or Canada - and why can't we offer free healthcare and college tuition like they do?

Because they have tiny populations and massive revenues for Oil exports per capita.

The Right will point to the "Miracle of Chile" to both support "capitalism" in the Latin American hot bed of Socialism and to lend an excuse for the murder of thousands of political dissidents during the Pinochet years.

Horse Sh#!. Chile supplies 35% of the world's (population 7.143 Billion) copper and has a population of less than 20 people. Even with that incredible metric Chile has its issues. I like a great deal of Milton Friedman's ideas... but I am quite sure that the strategy he caused to be executed in Chile would have been a complete failure in Ethiopia (or if China and India had not industrialized). And just as it is in the U.S., a very small elite have the population completely enslaved. So much for Libertarianism.

The progress humanity has made in the post-Enlightenment period is impressive. Unfortunately, the elites have reconstructed the very systems that the French and American revolutions were fought to overthrow. Forget the "1%" or the "elite". What the Fractional Reserve Banking systems of the world and their respective Central Banks have done

(and the military and police states used to enforce this despite most of the "enforcers" being "peasants" themselves. This is SOP in the enforcement business... the people volunteering or being forced into these activities never seem to see how they are manipulated into doing all manner of disgusting, disgraceful, and murderous actions and activities. Every establishment  uses the same strategy: Group young men together in places like military boot camps and police academies... beat them down to the point that, in order to survive this experience emotionally, they must depend on each other... "its all about the man next to you"...  instill an "us" versus "them" into these future soldiers and police against the people they are supposed to be serving in the first place with nonsense like: "green berets", "special forces", badges, medals... calling them "elite" (which insinuates that The People are inferior)... enlist help from propagandists in the media who then make movies like "Lone Survivor" (I read the book, did not see the movie, and had a completely different take away than those I saw posted in my Facebook feeds) to suppress dissent and to keep the recruits of "low information" very young men coming... this is the strategy that resulted in Black African death squads working for the White Apartheid regime, the NAZI SS and Gestapo, the Soviet KGB, Latin American "Death Squads", American DEA Agents, et al... all comprised of former human beings now capable and willing to participate in the murder and torture (prison is torture) of their fellow man in exchange for money, power, and status)

is to have effectively recreated an aristocracy and a peasant class. The only thing missing is the Monarchy.

One might argue that the "standard of living" for everyone in the industrial West has improved since the 1913 passage of the Federal Reserve Act (which the American victors then installed around the world in the period immediately after WWII). If measured by the number of cars, toasters, dishwashers, blenders, and electric toothbrushes, et al, that might be so. If measured in terms of free time, time spent outside in the sunshine, peace of mind, obesity, philosophical intellectualism, and personal security (how many MILLIONS died in the industrial wars from the American Civil War through Afghanistan? All of these wars were essentially fought over the idea of property rights derived from natural resources; and how many MILLIONS have been imprisoned by the elite for political or moral issues that were Malum Prohibitum rather than Malum In Se? How many of the young men drawn to or placed in those military boot camps or police academies even know what Malum Prohibitum means?) that system simply must be marked: "Epic Fail". When you throw in the enslavement of the masses via debt slavey to force the peasants to work on the Corporate and Government plantations (which, to be fair, are infinitely more pleasant than the plantations of the Antebellum U.S. South but which upon close examination bring the individual to the same place - a place where The People are controlled from birth through death by the establishment) controlled by the modern aristocracy I think the issue become incontrovertible.

The need to use force to control others seems to dominate our culture. That the "Sex Police" of both the Feminist Left and the Rabid/Fundamentalist Right engage in a never ending stream of propaganda to stop (great) sex from happening in a population of people that are TFTF (too fat to, well, fill-in-the-blank however you see fit) in any event never ceases to amaze me. Perfectly reasonable people that are soon to be TFO (too f***ing old) or just plain dead are busy having no passion, denying themselves the chance to actually live before they die, and are enraged by the very idea of other people engaging in such pleasures (Americans near universal, boorish, and provincial hatred of the French and their culture  is just another expression of this. It won't be long now before some Congressional boob from Billy Bob land wants to rename "French Fries" to "Freedom Fries" as seems to happen every 20 years or so. Think just how bizarre it is that the "fly over land" culture of obese beer drinking, hot dog and hamburger eating, NASCAR watching, tattoo ladened, pierced self-mutilators looks down their collective nose at a culture of grace, a taste for fine wine and excellent food (they wouldn't be caught dead serving what is offered at a typical American BBQ), a passion for love, and the discipline to enjoy all of that without seeming to wind up weighing more than their cars).

I think the problem can be summed up as a lack of philosophical examination of our existence because of the distracting drone coming out of the media/TV/movies for the most part, and by fundamentalist religious belief systems in certain pockets of the country. Think about it... do you know how many days, actuarially speaking, you have left to live? How many days you have left of health? Of physical beauty? Or whatever else is important to you? Not very many. Certainly not enough to spend any of those precious days unexamined and without fulfillment (however you might define that). How often do we consider our very existence? Me thinks that that is an important exercise, and that it is impossible to engage in this exercise when the TV is on. It is also impossible to perform this exercise while ensconced in a corporate cubicle irrespective of how much money you are making.

(Of all of the undeserving "heros" that exist in our media created national psyche, no more offending group exists than the cancer industry. From oncologists and radiologists to Big Pharma there has never been a greater "champion of exaggerated claims and false promises", well, with the possible exception of the Great Religions. Thankfully, this is making its way into thinking people's milieu. Many might even actually accept this and live and die accordingly. In the final analysis, you don't have a choice.)

When I first started blogging about America's energy predicament I missed the real issues and implications by a mile. 10 years+ of noodling the energy/economic/industrial/political model has left me with a sense that there exists in our society an endless supply of control freaks that get their jollies scaring the sh#! out of people and into living in a State of Fear: Feminists promote fear of men as molesters and rapists. Defense profiteers promote fear of Muslims (and why won't they just give us our oil?) as terrorists, the Left promotes fear of loss of health insurance and other economic issues of fairness and inequality, the Right promotes fear of the loss of "American values" (whatever the f*** that is), and certain dimwits in America are worried about immigration from countries that are no longer interested in emigrating anywhere.

What none of these groups seems interested in or capable of understanding is that whatever "problem" they identified that needed fixing either got fixed or can't be fixed or the ground completely shifted under their feet while they were standing on their soap box. That does not seem to end their enthusiasm or ire or their desire to see everyone else angry about whatever it is that they think people should be angry about instead of enjoying this precious day.

99% of the "Peak Oil" crowd seems bent on scaring people into supporting some kind of government action. While it appears that these people were absolutely right about the Peak in World Oil production, and maybe even world wide Natural Gas production, what they missed over the past decade is the implosion in the fertility rate of the industrialized world. To say this development is "unprecedented" is an unfair use of that word. Whether by luck or some invisible hand, that train has left the station and is hurtling down the track to its next destination. No doubt, some group somewhere will want to scare the sh#! out of people regarding that development, too... not to worry, there is nothing "we" can do about it and in the end it will take care of itself. Best to stop by the Jeffers Freedom Farm for some homemade dandelion wine with fresh mozarella and tomatoes, and then go off for some afternoon delight while still under the influence because in all of these matters we are our own worst enemy. There are no macro solutions. If one accepts that that is true, the rest is easy.

Of course, old habits die hard. I am interested in watching how Argentinians handle this, as I expect that they will lead the way, and not Spain, Italy, or Greece, for historical reasons. While the PIGGS got hit with peak oil (imports) several years before Argentina, its the picking of the low hanging fruit that jolts the tree the most, especially for trees/countries that have been in drought.

Our real dual tasks are to keep the scaremongers from using propaganda to motivate the people to give up their freedoms for security and to enjoy every precious minute of this very, very short existence.  I wrote this in July of 2008, right before the Great Recession began.

I am still comfortable with the ideas expressed in that post.

Thursday, February 13, 2014

Argentina is the Next Arab Spring

Argentina has gone/will go from being an Oil exporter to an Oil importer in 2014, and has already gone from being a net exporter of energy to a net importer. Their government can pretend that they have options, but there really is no option. For now, Argentina will be able to import Oil, mostly from Nigeria. But given their capital and currency situation I doubt that Argentina will be much competition for the big importers.

Argentina's current government will not survive this. The economic basket case of South America will soon be the political basket case of South America. The government has already nationalized YPF, the former state Oil company. Since the government has already hit the pensions and the Central Bank Reserves there is really nothing left to seize. America's Left should take a good, long, hard look at Argentina.

The entire world's debt enslavement machine should take a good, long, hard look at all of the unpaid judgments that have been stacked up against Argentina by World Bank's International Centre for the Settlement of Investment Disputes et al. Those debts, like the American Student Loan portfolio, will never be repaid. "Not now. Not never! Ever!" - the Great Oz

So it should be interesting to watch Buenos Aires go off. They were always so much fun to watch, but this time might not be so much fun. This time, I think its different.

Wednesday, February 12, 2014

Never Underestimate Complexity

Net Imports of Oil into the U.S. continue to rapidly decline.

From a peak of 13,354,000 barrels per day in October of 2005 to November of 2013's rate of 5,334 barrels of oil per day.

Yes, the U.S. is fast on its way to "energy independence". The rate of change in this  metric is simply breathtaking. And while domestic production has also risen dramatically (and 1mm bpd of ethanol, or 650k bpd of oil equivalent btu's, must be added), up 2.6 million bpd, that net increase of 3.25 mpd has not been enough to offset the decline of imports - which has left the U.S. with $100+ per barrel Oil, and the world price at $110+.

Domestic oil production have increased at a rate of 300,000 bpd each year for the past 8 years (not including ethanol), and oil imports have declined at a rate of 1,000,000 bpd per year. At this rate, the U.S. will be "energy independent" in 5 years...

Of course, that's not true. Canada will continue exporting to the U.S. at +or- 2.5 mpd for at least a decade or 2.

Me thinks the Syllogism looks like this:

Remove Canada's 2005 2mm bpd thru 2012 2.5 mpd imports. 

In the period 2005 - 2013 , 11,354,000 of non-Canadian imports declines to 2,834,000 of non-Canadian Oil imports... at this rate of change we have 3 years left of Oil imports into North America (Canada is in North America), at which point North America will no longer be "import land" nor "export land" (using Jeff Brown's narrative).

Will U.S. domestic supply be able to increase by nearly 3,000,000 bpd over the next 3 years? Will the U.S. use force to divert South American Oil? Anything is possible... but I think the best possible outcome is a 900k bpd increase in domestic production... and the worst is no increase at all, followed by a fairly rapid decline in domestic production.

I give almost a zero probability of non-Canadian imports happening in any important volumes by 2020. Argentina has joined the ranks of former oil exporters turned oil importers. Mexico is maybe 5 years away. Iraq better come with it... and right away.

So... this is it. The wind, solar, Natural Gas, electric car, Singularity, technophiles, or what-have-you folks have got to come through. Right now. If not, if Iraq does not step up and if solar/wind & Co. turns out to be a mirage... the recession that is coming our way will be the stuff of legend. If you think people were keeping their houses cold (think propane) this winter you ain't seen nothing yet.


I am not poetic enough to describe the political implications of this should the Iraq miracle or the wind/solar, et al thing fail us. Of course, they might pull it off. If Fracking and ethanol had not come along when they did, the U.S. would look a great deal more like Europe does today. We were lucky. Will that luck continue is looking very questionable at the moment.

Tuesday, February 11, 2014

The first casualty of War is Truth

“In war, the first casualty is Truth” – Aeschylus

There is a pitched propaganda battle being fought in the American media today.

The 2016 election season is nearly upon us, and the forces behind that propaganda who wish to ensure the murder of innocent unborn children are alight upon the land.  I write this piece for my Pro-Life Brothers and Sisters to keep them from being misled and from assisting the enemy.

And just who is the enemy?

The proponents of abortion/infanticide are easily found here in America. The dominant group are the Feminists, and their power structure emanates from the “Women’s Studies” of perhaps a dozen or so universities.

You will see all manner of “Sex Trafficking” and “Campus Rape Crisis” stories planted in the Main Stream Media and screaming along on your Social Media pages. Think Woody Allen's abuse allegations just happened to pop up now? Think again.

These stories are designed to enrage the female 18 to 39 year old voting block and to motivate them to vote. It is as simple as that.

Violent crime is literally in free fall in the U.S. No, I did not say that crime does not happen and that there are no victims. That’s the shred of truth that these propagandists build their story around.

Here are the facts, as I have recovered them from the U.S. Department of Justice’s FBI website,

In 1979, the number of reported rapes in the U.S. was 2.8 per 1000 people.

In 2004, the number of reported rapes fell to .4 per 1000 people.

For the last year for which we have data, 2011, the number of reported rapes fell to .28 per 1000 people. Reported rapes FELL BY 90% in 35 years.

This is where the soapbox and the use of Truth to achieve the propaganda goals comes in:

“If even one woman or little girl…” is not the point. The fact is Law Enforcement, technology, education, culture have created an environment in which all violent crime is in steep decline – especially sexual assault.

The very idea that women and children are being loaded onto planes, trains, buses, and automobiles and are being smuggled to the Super Bowl or to dogfights is absurd in the EXTREME. These victims, if there actually were any, are not put to death. We don’t have thousands and thousands of women and children going missing every day and bodies turning up in the street. If these people were victimized they would be telling their story – RIGHT NOW – on every news medium in the world.

So where are they?

They don’t exist.

No one gets away with anything, anymore. Ever. You can’t fart in public without it making it onto Facebook. DNA lasts forever – even through dry cleaning (Just ask Bill Clinton). Every one of us is walking around with a tracking device such that Law Enforcement can recreate ALL of your movements going back to the first day you had your cell phone. “Victims” would be entitled to not just putting their offenders in jail, but would be entitled to civil damages – and civil damages do not require a “beyond a reasonable doubt” burden but merely a “preponderance of the evidence”. Prove your case by 51% and his assets are yours, and those Super Bowl attendees? They are RICH.

So where are the lawsuits?

There are none.

But these facts do not serve the Feminist Left’s interests. So they have created a wave of media stories about a crisis of sexual assault on campus and women being led around in handcuffs for the sexual pleasure of Super Bowl attendees, and they are doing it because it works. It works because, for the most part, young people are “low information” voters. They vote with their heart and not their head.

So let me make a counter appeal to your heart:

The people bringing you these lies work for the women’s studies departments of Vassar, Barnard, Yale, and Michigan State, et al. Their agenda is “Hillary and abortion rights in 2016”. They know the data. They know they are lying. They don’t care about facts, truth, or justice. They don’t care about life. They care only about power and winning the next presidential election so that their president can make pro-abortion appointments for the Supreme Court of the United States.

That’s what this all about.

Abortion. The “Sex Trafficking” thing is a restaurant of lies drawing you into the Casino of abortion.

More coming very soon on this very ugly, ugly, ugly story.