[NonToxic]

Newbe here trying to put the pieces together. I have read many threads and tried to put it together myself but these questions linger. Where is my thought process incorrect?

The oil price has drastic effects on international economies. Many European countries are more fragile to the rise in oil prices and the subsequent rise in imports that are affected by these increases. The US has far more leverage to offset the differences with our own resources i.e manufacturing, domestic oil drilling and etc. When the dependancy on other countries imports is strained by the cost, the tendancy is to switch back to domestic manufacturers for the countries supplies. With an increase in oil drilling from-and only-for, domestic sales, the price per barrel can be decreased for the US.

With a strong dollar policy, doing domestic manufacturing and sales has cost soo much many large companies are still falling with the dominoe effect from years before. Not the same, but similar, is the effects of manufacturing in California. Where are they going to? other states.

Are more than half of the imports into this country American companies, paying for the manufacturing offshore, and selling back to Americans? The tax and profit of the sales are largely withheld in the states through sales tax, import taxes, transportation and etc.

The Euro and thier respective countries are not praising the rise of the currency. They are well aware of thier venerable position when being influenced from foriegn currencies. They are concerned over the current Bush administrations DELIBERATE/ALLOWED fall of the dollar. They know where they stand to lose if we keep dropping and they keep rising. With the constriction on thier manufacturing and exports from the inflated value, thier domestic problems like unemployment an inflation will surface and could topple administrations. Thier infrastructure is not near that of the US.

Wasn't this country was born to its superpower status WHEN THE DOLLAR WASN"T EVEN THE TOP CURRENCY.. the Sterling was?

[boilingleadbath]

The way I understand it, US oil production peaked in 1970, and therefore we can not increase it - we are allready going all out.

Alternatives may give us some oil, but as you said, not enough to continue our current system. Espesialy our constant-growth economy.

[b0nez]

I'll take a run at it.In the time America was booming,things that were different I will list.

1.Had our own oil,started declining in '73 and is almost nill.

2.We actually produced things of value.Nobody could make a car like us.Now our cars are considered a foolish buy.Even by Americans.Today "buy american" means buy a subpar product.

3.What do we now produce that is worth anything and has REAL value to mankind?We are now(this is the first year) we are a net food importer.The breadbasket of the world now buys food off the world market.

4.Americans used to be proud of a days labor,now they hate it even if its easy.Everyone wants to be rich and retired.Thus the bright idea,"lets let immigrants flood in unchecked".They'll do a days labor and not b*tch.

5.Our nation was at one time a production based country,now we produce useless junk.Americans and democracy is a expensive proposition,simply put we have become to expensive to keep up,in comes outsourcing.

6.Our companies,were at one time,American companies with a interest in being on our shores.Now they are "multinationals" that will do whatever it takes to keep up the bottom line.With no loyalty what so ever to any one nation.

[smiley]

Hi NonToxic, I'll try to answer your questions to the best of my knowledge.

It might surprise you, but if you add all the oil production of the individual European countries, you'll find that Europe is a larger oil producer than the US. The economic fragility as you call it is determined by the amount of oil you need to import. Europe produces more oil and consumes less oil than the US and is therefore is less dependent on imports.

Both Europe and the US are in terminal decline, so both cannot increase domestic production by more drilling. They already need huge investments to keep their production from declining more rapidly.

Your comments are on American companies overseas are partly correct. It is true that when a company moves overseas, part of the revenues come flowing back. However when you buy a product you pay for a number of things; you pay for the material costs, the R&D costs, the manufacturing costs and finally the profit. When a company moves its manufacturing and R&D overseas, the costs associated with these activities will stay there. Only a fraction of the money you pay for a product will make its way back. The rest ends up in the pockets of the overseas employers.

As for your question of the superiority of the US. I think that resources are the key to power. The powershift from Europe to the US came at a time that Europe had depleted most of its resources and the US discovered that it had a lot of resources.

The US is in now a similar position as Europe was 100 years ago. They have depleted most of their resources such as oil, gold, silver, copper, molybdenum etc.

That means that it increasingly becomes more dependent on other countries. In that respect China is rapidly becoming more important. China has a tremendous amount of wealth hidden under its soil and is not afraid to use them to their advantage.

To give an example of how resources affect the global equation. In order to make steel you need molybdenum. Molybdenum production in the US and Europe are in decline. China still has large quantities of molybdenum. What China has done in recent years is to cut back on the exports of molybdenum. This gives the Chinese steel industry a tremendous advantage. The Chinese steel makers are paying $2 for their molybdenum while the US and European steel makers are paying $28. The Chinese steel industry is killing the global competition.

Dependency and dominance don't go well together. The increasing dependency on foreign imports is slowly eroding the dominance and the superpower status of the US. The question is not whether they will keep their superpower status, but for how long.

[energyaddict]

Non Toxic wrote:

Thier infrastructure is not near that of the US.

Have you ever been to Europe? I suspect you haven´t! All over Europe you will find train networks, bus networks not comparable to anything in the US. The streets might be narrower as in the US - but are regulary in good shape compared with the US network. Random blackouts might be kind of usual in California - in Europe we have hardly any.

This is just to give a few examples of European vs. US infrastructure. You are kindly invited to come over and check!

[NonToxic]

Non Toxic wrote:

Thier infrastructure is not near that of the US.

Have you ever been to Europe? I suspect you haven´t! All over Europe you will find train networks, bus networks not comparable to anything in the US. The streets might be narrower as in the US - but are regulary in good shape compared with the US network. Random blackouts might be kind of usual in California - in Europe we have hardly any.

This is just to give a few examples of European vs. US infrastructure. You are kindly invited to come over and check!

I have been to europe. I guess my observation was incorrect!

[NonToxic]

Hi NonToxic, I'll try to answer your questions to the best of my knowledge.

It might surprise you, but if you add all the oil production of the individual European countries, you'll find that Europe is a larger oil producer than the US. The economic fragility as you call it is determined by the amount of oil you need to import. Europe produces more oil and consumes less oil than the US and is therefore is less dependent on imports.

Both Europe and the US are in terminal decline, so both cannot increase domestic production by more drilling. They already need huge investments to keep their production from declining more rapidly.

Your comments are on American companies overseas are partly correct. It is true that when a company moves overseas, part of the revenues come flowing back. However when you buy a product you pay for a number of things; you pay for the material costs, the R&D costs, the manufacturing costs and finally the profit. When a company moves its manufacturing and R&D overseas, the costs associated with these activities will stay there. Only a fraction of the money you pay for a product will make its way back. The rest ends up in the pockets of the overseas employers.

As for your question of the superiority of the US. I think that resources are the key to power. The powershift from Europe to the US came at a time that Europe had depleted most of its resources and the US discovered that it had a lot of resources.

The US is in now a similar position as Europe was 100 years ago. They have depleted most of their resources such as oil, gold, silver, copper, molybdenum etc.

That means that it increasingly becomes more dependent on other countries. In that respect China is rapidly becoming more important. China has a tremendous amount of wealth hidden under its soil and is not afraid to use them to their advantage.

To give an example of how resources affect the global equation. In order to make steel you need molybdenum. Molybdenum production in the US and Europe are in decline. China still has large quantities of molybdenum. What China has done in recent years is to cut back on the exports of molybdenum. This gives the Chinese steel industry a tremendous advantage. The Chinese steel makers are paying $2 for their molybdenum while the US and European steel makers are paying $28. The Chinese steel industry is killing the global competition.

Dependency and dominance don't go well together. The increasing dependency on foreign imports is slowly eroding the dominance and the superpower status of the US. The question is not whether they will keep their superpower status, but for how long.

Thanks this post helps alot.

[Kingcoal]

Let's look at a country by country analysis.

USA - cheap oil good, expensive oil bad
EU - cheap oil good, expensive oil bad
China - cheap oil good, expensive oil bad
Japan - cheap oil good, expensive oil bad

Saudi Arabia - expensive oil good, cheap oil good
Qatar - expensive oil good, cheap oil good

You get the picture.

One more thing, comparing the USA to the EU is not apples and oranges. The EU is a collection of countries, not a single country like the USA. The individual states of America were never countries in their own right.

The USA still has a lot of natural resources, many of which are off limits due to environmental laws. For instance off shore drilling is off limits most everywhere in the US. That is about to change, however.