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Is fast crash likely? Pt. 8

General discussions of the systemic, societal and civilisational effects of depletion.

Is fast crash likely? Pt. 8

Unread postby vtsnowedin » Tue 26 Dec 2017, 15:44:47

Back in 2008 people that had been able to refinance their homes at will and take out cash equity for any purpose, over the course of just one year found that they could no longer do that and in fact they were underwater on their loans and could not sell their homes if they needed to for the amount they still owed on them if they could find a buyer at all at any reasonable price.
That qualified as a fast crash for them and their families even if a majority of people were not over extended to that extent or as stressed.
There is no reason to believe that can't happen again and this time be more widespread with government efforts to stop it being this time total failures.
With oil prices rising I see this as a poor time to take on any unnecessary debt.
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Re: Is fast crash likely? Pt. 7

Unread postby Outcast_Searcher » Tue 26 Dec 2017, 16:05:34

asg70 wrote:
Outcast_Searcher wrote:we're getting into semantics again


Getting into? The only thing doomers have been able to hang their hat on since 2008 has been semantics.

That is PStarr's "it's not a glut, it's demand dearth" nonsense, for instance.

Semantics = spin-control.

No, semantics is about the meaning of words (I just looked it up to ensure I had the meaning right).

The reason for that could be many things. Spin control, politics, trying to win an argument, etc.

All I was doing was pointing out that (in my opinion), an economic crash is a lot broader concept than the speed of the incident, so there's nothing wrong with the topic, as stated.

To me, pstarr's repeatedly nonsensical claim about an oil demand dearth, in the face of ALL the data to the contrary is something completely different (i.e. he's just repeatedly making something up to try to win the argument).

But perhaps I'm just missing something fundamental.
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Re: Is fast crash likely? Pt. 8

Unread postby godq3 » Tue 26 Dec 2017, 16:45:24

https://m.youtube.com/watch?v=U5sniXKcAcE
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Re: Is fast crash likely? Pt. 8

Unread postby Subjectivist » Tue 26 Dec 2017, 18:19:21

I finally got around to reading Shut Down, book-shut-down-by-william-flynn-t62077.html

It is pretty good and when it was written a few years ago it sure would have seemed possible. I remember all the experts worried that the banking crisis could cause a fast crash.

It is a pretty good book and reads fast. I think Mr. Flynn is a bit pessemistic about things falling apart so totally so fast, but anyone commenting in this thread probably thinks that is exactly how it will happen.

If you havn't read it its only $3 on Kindle so give yourself a Christmas present and buy it. I am sure the autgor would appreciate that.
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Re: Is fast crash likely? Pt. 7

Unread postby asg70 » Tue 26 Dec 2017, 22:46:27

Outcast_Searcher wrote:pstarr's repeatedly nonsensical claim about an oil demand dearth


Well, it's like kind of like euphamisms like "developmentally challenged" for mentally retarded. By using a different term it can imply more of a positive or a negative.

Economics is about supply and demand. When you say glut it implies a supply surplus. But in theory it COULD mean a demand dearth. That's what the whole peak oil demand narrative is, that we will eventually reach a point where global oil demand decreases simply because we're shifting to EVs. But in his case he's painting an inaccurate portrait of the US soaking up oil and other regions being locked out of oil access and then it actually being the cause of their recessions.

He seems to think merely restating his theory again and again will somehow make people believe it. We're not buying it because the dots simply aren't connected.
“If and when the oil price skewers for 6 months or more substantially above the MAP, then I will concede the Etp is inherently flawed"
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Re: Is fast crash likely? Pt. 8

Unread postby Yoshua » Tue 26 Dec 2017, 22:47:57

China's energy imports

Crude oil +12% YoY
Nat Gas +26% YoY
Coal +10% YoY

The combination of Opec's cut/decline and China's rising imports are perhaps one cause of rising oil prices. China's coal production peaked in 2013 and fell by 9% percent last year, they are compensating that decline with imports. Their oil production seems to have peaked as well.
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Re: Is fast crash likely? Pt. 8

Unread postby Tanada » Tue 26 Dec 2017, 23:51:48

Yoshua wrote:China's energy imports

Crude oil +12% YoY
Nat Gas +26% YoY
Coal +10% YoY

The combination of Opec's cut/decline and China's rising imports are perhaps one cause of rising oil prices. China's coal production peaked in 2013 and fell by 9% percent last year, they are compensating that decline with imports. Their oil production seems to have peaked as well.


In China the mining industry is under strict national control and they closed a whole group of mines they considered to be inefficient, mostly in the smaller production category. Unfortunately for them due to unforeseen circumstances their larger more efficient mines were not able to supply all of the material which had come from the mines they closed so in the end they had a fuel shortfall and had to make unplanned purchases of import coal on the international market. Their plan is that within a year, two at the most the shortfall will be made up by expanding their most efficient mines and they will return to former coal import levels or less. Time will tell if this actually takes place.
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Re: Is fast crash likely? Pt. 8

Unread postby Newfie » Wed 27 Dec 2017, 09:11:16

I had read they also closed certain mines because of low quality/high pollution coal product.
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Re: Is fast crash likely? Pt. 8

Unread postby Yoshua » Wed 27 Dec 2017, 10:09:18

I read a statement by a Chinese government official who said that half of Chinas coal mines were uneconomic at a time when the coal prices were low. The coal price has gone up since then. But China produced half of the global coal output, which must be a bit toi much for any nation and might have exhausted their reserves. The global coal production peaked with Chinas peak coal production and is now in decline.

As I understand it, they are now trying to shift to natural gas by increasing their domestic production, but also through imports.

Anyway, Chinas rising imports of energy might be one driving force in the rising energy prices as the markets are getting tighter due to Opec's production cut and natural decline.

Are we about experience peak oil (all liquids)?
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Re: Is fast crash likely? Pt. 8

Unread postby Tanada » Wed 27 Dec 2017, 10:27:54

Newfie wrote:I had read they also closed certain mines because of low quality/high pollution coal product.


I was going by this info, posted February 22, 2016.
China has a total of 10,760 mines, and 5,600 of them will eventually be required to close under a policy banning those with an annual output capacity of less than 90,000 tonnes, the China National Coal Association has estimated.


There was a follow up story about the closures from June 2017.
Beijing will accelerate closing small-scale coal mines with an annual production capacity of 90,000 tonnes or less, as part of its plan to improve mine safety, according to the 13th five-year plan on the production safety of coal mines, jointly issued by China’s State Administration of Work Safety and State Administration of Coal Mine Safety.

There were 9,598 coal mines in China at end-2015 and 45.5 percent of them were small-scale. With poor safety conditions and equipment, most of the mines were vulnerable to disasters, the document said.

A series of accidents have occurred in the past at coal mines in major production hubs in China, causing fatalities.

China’s coal output rose to 3.75 billion tonnes in 2015, from 3.24 billion tonnes in 2010. The death toll from coal mine accidents dropped 75.4 percent to 598 during the same five-year period, according to the document.


I am not saying you are wrong about low quality coal, but nothing I have seen from official sources says that, they talk about efficiency, safety and surplus supply from small mines.
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Re: Is fast crash likely? Pt. 8

Unread postby Yoshua » Wed 27 Dec 2017, 11:33:54

"Coal production plunged (-6.1%), in line with China’s decline (-9%)
China, which represents 44% of world coal and lignite production, recorded a contraction in its production for the third consecutive year. To help support domestic prices, the Chinese Government has implemented measures to reduce coal production capacities including the closure of the most inefficient mines. In addition, the country’s output was also impacted by legislation from April 2016 that has cut coal mine production to a 276-day basis, down from 330 days previously. This measure was, however, eased again during the autumn."

https://yearbook.enerdata.net/coal-lign ... -data.html
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Re: Is fast crash likely? Pt. 8

Unread postby Newfie » Wed 27 Dec 2017, 11:52:48

Tanada

Here is the statement I got it from

““Bad weather, substitution of domestic ore with better quality imported ore caused by the anti-pollution policy, and strong steel prices…have all helped to push freight rates up,” Ong said“

Origionaly from Reuters
http://gcaptain.com/ships-bottleneck-ch ... and-soars/

It’s not real clear when he says “ore” if he means iron or iron and coal. I suppose, through Chinese to English translation that distinction could be lost.
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Re: Is fast crash likely? Pt. 8

Unread postby Outcast_Searcher » Wed 27 Dec 2017, 12:39:23

Subjectivist wrote:I finally got around to reading Shut Down, book-shut-down-by-william-flynn-t62077.html

It is pretty good and when it was written a few years ago it sure would have seemed possible. I remember all the experts worried that the banking crisis could cause a fast crash.

It is a pretty good book and reads fast. I think Mr. Flynn is a bit pessemistic about things falling apart so totally so fast, but anyone commenting in this thread probably thinks that is exactly how it will happen.

If you havn't read it its only $3 on Kindle so give yourself a Christmas present and buy it. I am sure the autgor would appreciate that.

I always liked a lot of Eastbay's comments. He had a different perspective and background than a lot of us, on a number of issues, which I appreciated.

Looking at the Amazon reviews, the opinions are VERY mixed. IMO, if you like end of the world stories or on the doomer side of the middle of the doomer/corny argument, then it appears likely you will like it. If not, far less likely.

This reminds me of Ayn Rand's work, re the reviews. If you tend to like her philosophy, you enjoy her novels. If not, you rant about shallow characters, etc.

For $3, and out of respect for Eastbay, I'll give it a try. Based on the reviews, I'm likely to do some skimming, but will try to get through it. And congrats to Eastbay. He's done what I'm too lazy (thus far anyway) to do -- written a book about his thinking about a core idea.
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Re: Is fast crash likely? Pt. 8

Unread postby Outcast_Searcher » Wed 27 Dec 2017, 12:43:27

vtsnowedin wrote:With oil prices rising I see this as a poor time to take on any unnecessary debt.

Amen. The big lesson from the 2008 to 2009 I've been baffled to see ignored almost completely by far to many people is that too much debt is VERY risky. I (stupidly) thought that the widespread pain and fear from that episode would change habits far more than they did.

It's enough to make me firmly believe humans belong in the category of the "dumb animals" we often look down on, at least in certain respects.
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Re: Is fast crash likely? Pt. 8

Unread postby kublikhan » Wed 27 Dec 2017, 15:53:10

Yoshua wrote:"Coal production plunged (-6.1%), in line with China’s decline (-9%)
China, which represents 44% of world coal and lignite production, recorded a contraction in its production for the third consecutive year. To help support domestic prices, the Chinese Government has implemented measures to reduce coal production capacities including the closure of the most inefficient mines. In addition, the country’s output was also impacted by legislation from April 2016 that has cut coal mine production to a 276-day basis, down from 330 days previously. This measure was, however, eased again during the autumn."
Exactly. The fall in China's coal production had nothing to do with China exhausting their reserves of coal.
The oil barrel is half-full.
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Re: Is fast crash likely? Pt. 8

Unread postby Yoshua » Sat 30 Dec 2017, 03:24:31

Iran seems to be on the brink of a Persian Spring. A over populated nation of 80 million protesting against rising living costs, corruption and wasteful wars in the Middle East is a ticking time bomb.

If for some reason the Strait of Hormuz would be blocked a fast crash would be inevitable.
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Re: Is fast crash likely? Pt. 8

Unread postby shortonoil » Sat 30 Dec 2017, 09:51:47

If for some reason the Strait of Hormuz would be blocked a fast crash would be inevitable.


The world is now 83% down the petroleum Available Energy curve. It was at the 50% point (or energy half way point) in 2012. The back side of the curve is much steeper than was the front side. The price of oil has now passed the maximum affordability level, and the economy will now begin to contract as a result. Expect the first major dislocation to occur in 2018 or early 2019. The world's $250 trillion in debt is now coming due! A fast crash is already inevitable.

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Re: Is fast crash likely? Pt. 8

Unread postby Cog » Sat 30 Dec 2017, 10:57:04

I do not think the word inevitable means what the ETP'ers think it means.
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Re: Is fast crash likely? Pt. 8

Unread postby onlooker » Sat 30 Dec 2017, 11:18:27

Well it looks like some of the rest of the world is waking up to the
" Net Energy Cliff". Enjoy the view
http://cassandralegacy.blogspot.com/201 ... chool.html
An Open letter to the School of Public Health, UQ, re: the looming net energy cliff
The Big Economic Plunge is approaching
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Re: Is fast crash likely? Pt. 8

Unread postby GHung » Sat 30 Dec 2017, 11:30:30

onlooker wrote:Well it looks like some of the rest of the world is waking up to the
" Net Energy Cliff". Enjoy the view
http://cassandralegacy.blogspot.com/201 ... chool.html
An Open letter to the School of Public Health, UQ, re: the looming net energy cliff


I'm not sure that the author using sources like doomsteaddiner is going to help his case much. Seems Geoffrey may be a bit late to the party, but better late than never, eh?
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