[AdamB]

The ETP model was completely discredited last year and I'm surprised anyone wants their name associated with it. Even Shorty has abandoned this thread.

Smart move for a welsher.

[AdamB]

Back to the ETP model. It is interesting to note that prices have been above the maximum level for 20 months. For me that means the model is well and truly broken. We need a ETP mark 2 model

You are correct. The price of oil has disconnected from its 100 year correlation to petroleum production.

It isn't disconnected from the correlation. The correlation never existed. Spurious relationships, remember? I called this one within 5 minutes of paying attention to it, shortly after you began pimping it. Even before you welshed on bets because you were dumb enough to not listen.

Silly rabbit.....

[AdamB]

BahamasEd has moved from posting an ETP weekly MAP last year to an ETP semi-annually MAP this year. What a joke.

Then the ETP Bozo posts his weekly current* GDP/cumulative oil production graph. He might as well post a GDP/cumulative egg production graph.

Plenty of examples here of correlations of far more value than those of some common welsher.

[shortonoil]

When the only responses made to a post are made by BDSS (Brain Dead Serial Spammers) that is an indication that people are apparently noticing how bad the real economy is actually becoming. It is no coincidence that the world's economy went into the crapper at the same time that oil's deliverable energy reached its downward directed inflection point. With world trade, manufacturing, retail, employment, and corporate earnings now tanking the stock market is the last line of defense for the PTB to perpetuate their "everything is wonderful scenario". With all the major indices against their upper resistance levels, and apparently stuck there that will not work for much longer either.

[AdamB]

When the only responses made to a post are made by BDSS (Brain Dead Serial Spammers) that is an indication that people are apparently noticing how bad the real economy is actually becoming.

The questions here relate to why the MAP has been so thoroughly discredited by reality going on 2 years now and why when I told you years ago that you had no correlation in your results you didn't listen.

Please, let us hear more about how you now know that your correlation was as worthless as I told you, years before reality demonstrated it.

[shortonoil]

Plenty of examples here of correlations of far more value than those of some common welsher.

More regurgitation from a BDSS (Brain Dead Serial Spammer). The correlation between the Etp Model's output, and the price of oil has been phenomenal (r = 0.956). The energy to produce oil has been almost perfectly correlated to its price for over 58 years. With that relationship now beginning to fail there is undoubtedly a serious breakdown taking place between the world's most important fuel source, and its economy. If the global slowdown, the collapse of entire nation states, and the frantic reshuffling of supply lines is the result of that ongoing process the world has a problem that is so serious that modern civilization may not survive. With the world now reaching its maximum petroleum production level the ongoing unraveling of the world economy can only be expected to accelerate over the next few years.

We are probably witnessing one of the most dramatic events in human history.

click to enlarge

[asg70]

Short, you still have a failed bet to pay. Why don't you do that before trying to raise ETP back from the dead?

[asg70]

Back to the ETP, at least it did predict, back in 2014, that the trend going forward would be towards lower prices.

ETP didn't predict low oil prices.

ETP was invented as a response to low oil prices.

ETP is an apologia for peak oil that attempts to sell the concept of low rather than high oil prices being a sign of doom. It's a theory tailor-made for an oil glut, which is why it's still attractive to the dwindling remnant of peak-oil doomers.

The problem was that ETP map worked best during the height of the glut when OPEC was trying to bankrupt the frackers by continuing to pump flat out and drive prices down. That eventually abated and prices began to rise, not apocalyptically so, but high enough to pop right out of the ETP map. That's when Short lost his fateful bet.

But pretty soon (I'm not sure exactly when) the original ETP map will bottom out to 0 which is ETP's version of doomsday. Short and his cadre of sycophants will have to continue to spin conspiracy theories to explain why oil prices don't line up with the map.

This is the reason why Short is now circle-jerking with Armageddon in the stock market thread. He's clinging to the idea that some sort of financial manipulation is at the heart of why prices aren't lining up, and suggesting that any and all downard economic indicators should be somehow a result of his ETP / EROEI function.

Verdict:

Short started out with a desired conclusion (doom) and then worked back to invent a theory based on the present-day conditions at the time that could suggest it. Like most doomers, he set the carrot of doom just far enough ahead in order to instill existential dread in his followers. But just like Harold Camping and his ilk, time marches on and when the predicted doom doesn't happen...

[Yoshua]

The MAP curve goes through annual average price points. If Bahamas had made a graph with annual average WTI price points and drawn a line through those points, then the WTI and the MAP would show better correlation...not perfect...but good enough.

And that is despite all the money printing by the central banks.

I have said that the MAP doesn't work after the Energy Half Way Point...but it freaking does.

resources/image/1745

[shortonoil]

...but it freaking does.

We shall await Bahamas graph.

When the Maximum Affordability Function failed in 2017, I found that by adjusting the function's start date from Jan 1, 1900 by a few months the function's output returned to normal against the data. Since there was no theoretical justification for doing it, I dropped it. Of course, a graphical solution is often possible for most mathematical problems. When using something like a currency, that has no fundamental physical bases, it may be the best approach. The stock market thrives on technical analysis for some indeterminable reason outside of the fact that people relate to simple straight line representations.

[asg70]

When the Maximum Affordability Function failed in 2017, I found that by adjusting the function's start date from Jan 1, 1900 by a few months the function's output returned to normal against the data.

In other words, when the chart doesn't produce the results you want, keep cooking the books until it does. Such objective methodology!

[Outcast_Searcher]

When the Maximum Affordability Function failed in 2017, I found that by adjusting the function's start date from Jan 1, 1900 by a few months the function's output returned to normal against the data.

In other words, when the chart doesn't produce the results you want, keep cooking the books until it does. Such objective methodology!

Yup. That's not a valid theory or anything with predictable results. If that method meant anything, then active fund managers could make a FORTUNE with curve fitting, and then setting up a portfolio, and waiting.

Shorty, no one CARES what you claim you COULD have predicted AFTER the fact, AFTER money was lost on your advice. (ANY random person touting "investment advice" can do that).

Unless you can come up with a new theory which explains and predicts why the crude oil MAP will be at $2ish at the end of 2021 (or whatever the new date and price should be), so people can make reasonable, practical investments to take advantage of that AHEAD OF TIME, it's all babble-speak and the usual terrible perma-doomer results.

And given your track record, you'll need to have a very good explanation (i.e. not "too much debt", etc), why people should believe you next time.

[Outcast_Searcher]

...but it freaking does.

We shall await Bahamas graph.

When the Maximum Affordability Function failed in 2017, I found that by adjusting the function's start date from Jan 1, 1900 by a few months the function's output returned to normal against the data. Since there was no theoretical justification for doing it, I dropped it. Of course, a graphical solution is often possible for most mathematical problems. When using something like a currency, that has no fundamental physical bases, it may be the best approach. The stock market thrives on technical analysis for some indeterminable reason outside of the fact that people relate to simple straight line representations.

It's amazing. Pretty much everything you write is just nonsense, re economics or investment. And given your lack of credible citations, it's not like you have to justify anything. Great writing style, IF you can get away with it, again and again.

Technical analysis is a blatant fail, re objective, useful apriori advice. Once the trading costs are factored in, over time, you can't make money on it vs. simple buy and hold in efficient broad based mutual funds.

A whole group of books on Index fund investing by folks like Jack Bogle, Larry Swedroe, and comments (like in the BRK annual reports) by wise investors like the venerated Warren Buffett clearly show this.

Or you can go straight to the track records by the clowns who claim to be able to predict markets by looking at charts. With the famous Robert Prechter, a long time Elliot Wave analysis adherent being at the bottom of the pack with a roughly 20% accuracy track record -- one has to ignore a LOT of data to claim technical analysis is worthwhile.

https://www.cxoadvisory.com/gurus/

For the umpteenth time, it's physical "basis", not bases. If you have no clue what you're talking about, why even discuss a fundamental basis? To sound clued in?

What do you even MEAN, "a graphical solution is possible for most mathematical problems"? That's total nonsense. One can construct a graph for nearly any equation. All a graph does is visually show a mathematical relationship. That doesn't imply any sort of mathematical problem is "solved", or there is even a hint of a solution. When you say things like that it makes me think your mathematical pedigree is either low quality mail order, or in your imagination, because it implies very little understanding of mathematical problems in general.

You live in the real world. If your theoretical musings are useless, perhaps you should stop dispensing financial advice based on them, especially for pay (like your ETP paper), especially when you're advocating people invest based on them. Though OTOH, that would be consistent with the morality of your welshing on an oil price bet, and then lying about whether the bet took place.

[Outcast_Searcher]

The MAP curve goes through annual average price points. If Bahamas had made a graph with annual average WTI price points and drawn a line through those points, then the WTI and the MAP would show better correlation...not perfect...but good enough.

Define "good enough".

Way off is way off. It's WAY too far off for people to have been able to make money betting on.

If you think you can make money betting on the MAP prediction for 2019, 2020, or 2021, whether you choose the mid-year point or the end-point, why not just send me all your money, instead?

Surely, that would be "good enough".

And what do you use after 2021? Negative oil prices? How, pray tell, do you make money on THAT bet?

This isn't fantasy land. People are making and losing real money betting on future oil prices, and economic assumptions based on those pricing bets.

[AdamB]

Plenty of examples here of correlations of far more value than those of some common welsher.

More regurgitation from a BDSS (Brain Dead Serial Spammer). The correlation between the Etp Model's output, and the price of oil has been phenomenal (r = 0.956).

I can cherry pick data to drive a line through to get an R squared of 1.0....why did you decide to only cherry pick data to get yours to 0.956?

And I posted PERFECT examples of your spurious relationship. The one I told you about years ago, and the on that you just indicated wasn't holding. So now you want to explain why your correlations don't work even with a high r squared value on cherry picked data?

The energy to produce oil has been almost perfectly correlated to its price for over 58 years.

Really? You shouldn't say this in front of someone who has produced oil and knows better. I've managed wells that have produced for decades, declining away as wells naturally do. The lifting "energy" required has decreased with that volume through time, as any production engineer would tell you if you had bothered to ask. During this time the oil price went from <$10 back during the 86 crash to about $50 today.

So how is it that the energy to produce my oil has gone down, while prices have gone up, and someone conned you into thinking this was almost perfectly correlated? Oh, that's right, you are the guy who can't see a spurious relationship even after I give you an entire website full of them!

We are probably witnessing one of the most dramatic events in human history.

You said similar things when you thought peak oil was happening nearly 15 years ago.

Paid off the bet you lost using this impeccable logic yet?

[AdamB]

The MAP curve goes through annual average price points. If Bahamas had made a graph with annual average WTI price points and drawn a line through those points, then the WTI and the MAP would show better correlation...not perfect...but good enough.

And that is despite all the money printing by the central banks.

I have said that the MAP doesn't work after the Energy Half Way Point...but it freaking does.

You might not know what the word MAXIMUM means when used in measuring relative values, but most everyone else here does. You don't put a MAXIMUM value UNDER some other value that you hope and dream might be the actual maximum, because when you do, you look like you didn't learn 2nd grade math when they explain what a maximum is.

No need to be an apologist for nonsense Yoshua, it just causes the impression of stupid to cling to you as well. ASG has it exactly correct...after Short was busy predicting the end 15 years ago, and the end didn't come about, he worked backwards after his rapture event didn't whisk him up to heaven until he had some stupid claim that sort of looked okay. For about a year. Then market fundamentals post recession did what they've always done, Short began welshing on bets because paying them out would be an admission that not only does he know nothing about the oil industry, geology or economics, but those who looked over his paper and laughed it right out of the pre-review process understood what I told him years ago. Spurious relationships aren't correlation. They just look that way for a time, or a reason that you don't understand.

[AdamB]

...but it freaking does.

We shall await Bahamas graph.

He posted the graph at the beginning of this thread. Showing price well about the MAXIMUM, and the trend looking nothing like what was claimed.

You welshers will do anything to skate on paying up,eh Short?

[Yoshua]

We are talking about maximum AFFORDABILITY, which is an economic term. We all know that if the consumer can't afford rising prices, then he can pay rent, fuel and food with his credit card... until he goes broke. Corporates can add more debt until they go bankrupt. The U.S government is adding trillion dollar plus in debt annually...and can continue with this for some time since it owns the dollar.

Nations that run out of their dollar reserves plunge into darkness.

I can live with that the Etp MAP isn't exactly perfect after the Energy Halfway Point.

I wish that the Etp Model is wrong though.

[asg70]

I wish that the Etp Model is wrong though.

And how long will you let this charade go on before you concede that it's wrong? I remember when onlooker formally disavowed ETP...only to jump back on the bandwagon later. Seems like in the end doomers gonna doom-monger, if you know what I mean.

[Baduila]

Since 2008, five oil price maxima exist, which are points of demand destruction. A these points the oil price crashed because it got too high for the economy. They can be connected by a straight line. LODD, which stands for "Line of Demand Destruction", is a good name for this line.

A close view on the maxima shows, that the line is accelerating downwards.

lodd.png