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PeakOil is You

Why The US Will Be Least Affected By Peak Oil

Discussions about the economic and financial ramifications of PEAK OIL

Unread postby MD » Sat 11 Jun 2005, 17:51:18

bobcousins wrote:
RdSnt wrote:Actually I agree, the US will be less affected. However, that's because there will be less Americans to be affected. They are going to start killing each other in much larger proportions as they fight over the last Calvin Kline t-shirts and Nike shoes. It will probably start with the rappers shooting each other for the gas to drive their bling-bling Escalades.


That's a good point. Hypothetically speaking, if all the Republicans and Democratics killed each other on a one for one basis, how many people would be left?

Not many, because those of us attempting to occupy the middle will be caught in the cross-fire.
Stop filling dumpsters, as much as you possibly can, and everything will get better.

Just think it through.
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Unread postby Markos101 » Sun 12 Jun 2005, 08:03:45

Sparaxis wrote:
trade surplus treasury purchases


Where do you get such ideas? We have no trade surplus. We have the largest trade deficit and largest foreign debt of any country in the world. We OWE foreign countries over $1.75 trillion (before this year's $800 billion deficit is included) or more than 25% of our GDP. These are claims on our goods and services to others. Other countries can call in these debts as they will (i.e. spend the money, so they can pay higher oil prices, if oil remains dollar-priced) and that is a direct route to a US economic depression.

I just don't understand such sanguine attitudes. Exactly where did you study your economics and finance?


I think geopolitics has a part to play; if foreign countries decide to stop supplying the US with goods or services until such time that they pay up, then those countries will alas not be able to obtain their dollars, hence they will not be able to import oil. With dollars as reserve currency, exports to US = imports of oil for all countries apart from the US.

The US, should it be plunged into a depression by a sudden calling for debts, can also equally refuse to pay the invoices. One then has to think what the other countries would do - and in this case they probably wouldn't be able to do much and would be forced to continue supplying the US with goods and services so they could continue to print dollars anyway. This could certainly yield to potential conflict.

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Unread postby bobcousins » Sun 12 Jun 2005, 08:42:10

Sparaxis wrote:
trade surplus treasury purchases

Where do you get such ideas? We have no trade surplus.


Surely he means other countries with a trade surplus buying US treasury bonds.
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economic analysis or self deception: correlation

Unread postby chanssuchin » Sun 12 Jun 2005, 22:29:03

Correlation is not causation.

Economic analysis is fairly bankrupt, it has many assumptions that it posits, but unlike hard science it goes on to violate the assumptions in its analyses. Read the Bankruptcy of Economics and Guide to what is wrong with economics ... with an open mind.

As a computer modeller of growth of natural systems I was always suspicious of economic models. They 'externalize' every thing that they don't understand. Pollution, resource depletion, ecological process destruction are all avoided like the plague by economists (ex H. Daly and Costanza and a few others.)

I would bet that the effects on US will be harder since we are higher on the economic bubble surface and have actually heavier dependence on Oil!
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Unread postby turmoil » Mon 13 Jun 2005, 00:36:24

RdSnt wrote:Actually I agree, the US will be less affected. However, that's because there will be less Americans to be affected. They are going to start killing each other in much larger proportions as they fight over the last Calvin Kline t-shirts and Nike shoes. It will probably start with the rappers shooting each other for the gas to drive their bling-bling Escalades.


:lol: werd...a gangsta's gotta do what a gangsta's gotta do. :lol:
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Unread postby Macsporan » Mon 13 Jun 2005, 01:05:03

I would have thought that the best equipped to deal with PO would be nations that still have large numbers of peasant farmers to fall back on.

The US having gone the furtherest down the oil road is the most in danger.

There are no back-up systems, none.

All this economics talk is quite vapid. Economics is not a deductive science.

All that maths is largely waffle built around the unsupport mental conjectures of a couple of late 19th Century French pundits.

It was never then or subsquently tested to see if it has anything to do with reality.

It is more like medieval scholastic theology than physics, which it tries hard to impersonate, in that it proceeds from unproven postulates into which it tries to force reality, rather then physics which observes reality and then devises theories to explain it.

Even of the US I suspect, the dangers of PO are more apparent than real.

True it has, like many other countries, got used to the ideal of constant economic growth, but historically speaking this has not been the norm. Quite often in the past economies have been stagnant or even gone backwards.

For people to make out that universal death and desolation will follow the moment economies don't grow is a little like some disgracefully spoiled aristocratic female declaring that she'll absolutely die if she doesn't lie on mink furs and eat ice-cream five times a day.

Most of the immediate problems of PO, when it hits, could be stayed (though not, of course solved) by systematic rationing of food and fuel and everyone keeping their nerve.

Of course this will involve disgarding the simple-minded if comforting Thatcher-Reaganite doctrines about free markets, but any nation that is prepared to die for their superstitions deserves all they get IMHO.

In the words of that greatest of Americans FDR: "There is nothing to fear but fear itself".

To which I would add: "and fear of fearing the fear of fear..." :-D
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Unread postby Markos101 » Mon 13 Jun 2005, 08:01:45

Yesterday I watched a BBC documentary programme following the escapades of a British man in his one week stay with an Amazonian tribe (tribe name began with 'C', but I can't remember exactly what it was).

The tribe found it almost hilarious the amount of baggage and gadgets the British man was wearing on his back. His parting words to them were 'You think at least half of this is waste. And you know what - you're right. But unfortunately that's the world I live in'.


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Unread postby Claudia » Mon 13 Jun 2005, 14:10:39

As a computer modeller of growth of natural systems I was always suspicious of economic models. They 'externalize' every thing that they don't understand. Pollution, resource depletion, ecological process destruction are all avoided like the plague by economists (ex H. Daly and Costanza and a few others.)


Very true. I love economics, but agree that the current economic models are fatally flawed for all the reasons you state.
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Unread postby aflurry » Wed 15 Jun 2005, 17:44:46

Claudia wrote:I love economics, but agree that the current economic models are fatally flawed for all the reasons you state.


This is the kind of thread i like to read on this board. new ideas being floated, people with good information chiming in. general disregard for accepted theories of many kinds. a little abrasive sarcasm to keep it fun. thanks everyone.

If there aren't labourers to feed, house, make tennis rackets and croquet sets, build their cars, heat their homes, then their assets will crash overnight too.

And since all of the actual manufacturing infrastructure has fled overseas, they'll be buying all that stuff from China, not the the US non-elites. I guess they'll still need their latte's and hairdos as well though.

Despite a seriously annoying writing style, i think Kunstler's main big contribution to this story is to point out the specific so-called "misallocation of resources" the US has engaged in over the last 30 years that will make adapting to the era especially tough here. His best observations occur when he doesn't stray too far from his main focus as an architecture and civic planning critic.

Even if Markos101's theory is right and the US can leverage the priviledged status of its currency status to evade meltdown, the strains it does feel will be felt greater due to the developmental cul-de-sac we have created.
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Unread postby Macsporan » Wed 15 Jun 2005, 18:41:12

God bless America, her back to the wall
The bigger they are, the harder they fall.

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Unread postby Claudia » Wed 15 Jun 2005, 18:54:19

Despite a seriously annoying writing style, i think Kunstler's main big contribution to this story is to point out the specific so-called "misallocation of resources" the US has engaged in over the last 30 years that will make adapting to the era especially tough here.


Funny, I felt the same way. The "tragic misallocation of resources" concept really grabbed me more than anything, because it's one of the most serious things you can accuse an economy of doing -- even on an economist's terms.
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Unread postby jaws » Wed 15 Jun 2005, 19:01:24

Claudia wrote:Funny, I felt the same way. The "tragic misallocation of resources" concept really grabbed me more than anything, because it's one of the most serious things you can accuse an economy of doing -- even on an economist's terms.
There are some fringe schools of economics that address this problem. The Austrian School, despite being made up of libertarian whackjobs, coined the concept of malinvestment, investments made based on false information regarding the future viability of the investment. They tie this in with interest-rate manipulation and inflation but it is also highly relevant to rising energy scarcity.
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Re: Why The US Will Be Least Affected By Peak Oil

Unread postby Subjectivist » Sun 07 Oct 2018, 08:42:41

Heres the rub. Back in 2005 when oil prices went up that meant a huge quantity of Joe6P cash went to OPEC or other foreign destinations to buy oil. This drained a lot of cash out of the American economy and caused problems.

Now however Fracking is producing more oil than ever before in America, so when prices go high what happens? Instead of the American consumer buying oil and sending cash out of our economy we are buying American oil and recycling that cash through our own economy. Its like the days before WW II when we were energy self sufficient.

Sure it won't last forever, but you should enjoy it for the present!
II Chronicles 7:14 if my people, who are called by my name, will humble themselves and pray and seek my face and turn from their wicked ways, then I will hear from heaven, and I will forgive their sin and will heal their land.
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Re: Why The US Will Be Least Affected By Peak Oil

Unread postby Tanada » Sun 07 Oct 2018, 16:44:10

Subjectivist wrote:Heres the rub. Back in 2005 when oil prices went up that meant a huge quantity of Joe6P cash went to OPEC or other foreign destinations to buy oil. This drained a lot of cash out of the American economy and caused problems.

Now however Fracking is producing more oil than ever before in America, so when prices go high what happens? Instead of the American consumer buying oil and sending cash out of our economy we are buying American oil and recycling that cash through our own economy. Its like the days before WW II when we were energy self sufficient.

Sure it won't last forever, but you should enjoy it for the present!


This idea bears some deep thinking. From a certain point of view up until around 1952 the USA was a net oil exporter which is a good portion of why its influence was so great in the post war years. Exports and a robust national economy coming out of the second world war meant the USA could afford the expense of the Marshall Plan to rebuild western Europe which in and of itself restored a lot of world demand that was suppressed as the war effort wound down in 1946-50. The hostilities in Korea and the demand of the Cold War coupled with the recovery of Western Europe itself brought world demand roaring back by the mid 1950's but even so the USA was really a minor importing nation until we hit our conventional peak in 1970.

Now we are on the run up to our unconventional 'fracking' peak and as a result our imports are at a decades long low, around where they were in the mid 1960's. As a result the money being spet on oil products, no matter how pricey those liquids are, is being dumped back into the USA economy. We have more oil workers this decade than we have had for a generation, and these people are well paid and willing to spend most of that money in their local communities, which is all to the good. I took a vacation last month to South Dakota and discovered that almost all low paid jobs in that state are held by recent legal immigrants because all the local late teen through thirty something workers migrated to the Bakken in North Dakota or moved up to take mid level local jobs when the former employees moved north. The quarry I drop past in the middle of the state was offering darn good paying jobs to fill vacancies and one of their products is manufactured sand for fracking companies in North Dakota!

Needless to say, even though the oil industry in North Dakota went through a crash in 2015 they are back in business in a big way. The people from South Dakota who lost their Bakken fracking jobs in many cases moved to Texas in 2016 when the Permian took off like a rocket.

As a result of all these factors if we really are finally at world peak, which remains to be proven, the USA is in a much better position to weather the storm at least in the beginning due to the fracking industry and the fact that we have not yet hit our fracking peak.
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Re: Why The US Will Be Least Affected By Peak Oil

Unread postby ralfy » Sun 07 Oct 2018, 22:31:05

A JIT system that requires extensive amounts of oil to provide a few days' worth of food, fuel, medicine, etc., in various towns and cities.
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Re: Why The US Will Be Least Affected By Peak Oil

Unread postby Tanada » Mon 08 Oct 2018, 13:02:07

ralfy wrote:A JIT system that requires extensive amounts of oil to provide a few days' worth of food, fuel, medicine, etc., in various towns and cities.


Your complaint is based on the idea that change can not take place.
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Moved earth and heaven, that which we are, we are;
One equal temper of heroic hearts,
Made weak by time and fate, but strong in will
To strive, to seek, to find, and not to yield.
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