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The Global Warming Contradiction

2009-07-05T18:16:00.001-07:00

Is the Earth warming? The current theory is that all this CO₂ emission into the atmosphere is causing the Earth to gradually warm. This is expressed frequently as the "hockey stick", showing a gradual cooling from about 1300 to maybe about 1750, and then after that, a slow warming until about 1980, then suddenly shooting upward, producing a graph that looks like a hockey stick. An example might be this one from the UK. People concerned about global warming are saying that unless we do something about this, irreversible adverse things will happen such as the expansion of deserts and the flooding of coastal cities. Indeed, these graphs show about a 1.3 degree F increase in global temperature in the past 100 years.

We have now a new player in the game, however. The Sun has just passed the supposed minimum of its sunspot cycle and should be rapidly increasing in sunspots, especially at moderately high latitudes. However, for the past year, the Sun has shown almost no spots. What's happened to it? This is not the first time this has happened. In the 1600s, the Sun had no spots for an entire human lifetime. During this span of around 100 years, global temperatures fell about 0.9 degrees F, causing the "Little Ice Age".

Are we entering a new Maunder minimum? If so, the increase in temperatures caused by global warming will slow down or stop. The figures I have cited seem to suggest that the Earth will warm only by 0.4 degrees per century, or 0.04 degree F per year. That would then suggest that instead of preventing global warming caused by carbon emissions, we need to keep sending carbon dioxide into the atmosphere or else we could go into an Ice Age. Further, we will not be able to do this, because oil and other fossil production will eventually (and soon) decline and stop, at which point the ice age will come.

But I see a contradiction in this. The problem is that these figures suggest that the decrease caused by lack of spots is a substantial fraction of the increase caused by human-induced global warming. This should be reflected in the hockey stick graph. Since sunspots usually (and in the past century has) followed an 11-year cycle, that should cause 11-year oscillations in the graph of global temperature. But the graphs you see on warming in the past 100 years show no such oscillations. That suggests instead that temperature changes caused by sunspot changes are a minuscule fraction of the changes caused by human-induced global warming. But clearly they aren't.

Another way of looking at it is to look at the "solar constant", the amount of energy striking the Earth on the average. This is 1365 watts per square meter, and it can vary from 1363 to 1367 watts per square meter. Since the Sun has no spots, I would suppose the 1363 holds now. That translates into a decline of 0.3 degree F over the next few years. This also shows that sunspots cause a substantial part of the change in earthly temperatures, but by not as much as the 0.9 degree change cited earlier. and it does not resolve the contradiction between this type of reasoning which suggests 11-year oscillations in the global temperature and the lack of evidence of such cycles.

Until we resolve the contradiction, we don't know which way the world is going to go. Much discussion on global warming is one-sided, with people arguing unequivocally for one side or the other, both the global warming zealots and the global warming deniers. We need to stop arguing and do some analysis. Will the real global change determiners please stand up?

Michael Jackson and Peak Oil

2009-06-29T19:10:00.001-07:00

Oil prices are rising, the economy may be starting to stagger again, and many countries are fast using up their oil supplies. So what does the nation, and the world do? It goes ape over Michael Jackson at his death. This says a lot about where we are and where we are headed. See my companion blog "Beyond Opinion" for further information on Michael Jackson, and for a good description of what he means for us, look at James Howard Kunstler's weekly column "The Man in the Mirror".

What now?

2009-05-14T20:41:00.001-07:00

It's been some time since I posted here. But a lot has happened. I thought for sure that oil would continue to rise. But it rose too fast. It included the rise that should be there due to increasing scarcity of oil, but it also included the investments of many people who felt that oil stocks would continue to go up. The combination caused the price to shoot to $147 a gallon and gasoline to over $4 a gallon. People need gasoline to do their business. When they could not get it, they cut back on other things, including the mortgage payment. This caused the foreclosures, which in turn endangered the banks and threatened the entire financial system. When this happened, a severe recession occurred, causing even oil to drop drastically in price, all the way down to $35 a barrel and $1.46 a gallon for gasoline, causing me to get a gasoline bill in the single digits. The price of oil has moved back up to $57 a barrel.

So what's next? That's hard to say. The Fourth Turning says that history comes in cycles or turnings. The stages of life are 22 years long, and so are the lengths of generations, so history also comes in periods of 22 years, called turnings, which come in First, Second, Third, and Fourth varieties. The first is a High in which high hopes for society are made. This is followed by the disillusionment of the Second Turning, when the babies of the First rebel against the previous Crisis parents, as in Jimi Hendrix, campus protests, and marijuana. The Second Turning also included a mini-depression and two major oil crises. This gave way to the decadent Third Turning, or unraveling, with the focus placed on the individual, as societal pillars wear away. This leads to a Crisis, the Fourth Turning. The last Fourth Turning was the Great Depression and World War II.

I believe now the Fourth Turning has started. It started on 2007 July 27, when the Dow plummeted 400 points because of mortgage foreclosures. It really gained momentum in late summer 2008, when many institutions teetered on the brink and had to be tarped out.

HS Dent is a stock market advisor who bases his decisions essentially on the Strauss and Howe Turning theory. He predicted a big boom in the late 1990s, and booms in the Double Zero years, and now he calls for the Great Depression of the 2010s. I read his column, and he is calling for the current deflationary conditions to continue. Keep your money in money market funds and it will stay the same while deflation occurs; hence your buying power increases.

However, the major crisis on the horizon is Peak Oil. Apparently the production of oil has peaked. It dropped drastically this year, from 88 million barrels/day to 82, but that was because of lack of demand. Still it forms a peak. It may not recover from this, because the oil fields are starting to run out. A stock advisor who is aware of peak oil is Stephen Leeb. He says the low price of oil is temporary. The economy will pick up again this year, and when it does, so will the price of oil. We are already seeing this. Oil goes up and down with the market. He is calling for this to continue, with first prosperity, then a runaway inflation.

So which is it? Will we have deflation or 100% inflation? It's hard to say. It is a vicious cycle:

1. When the economy improves, the demand for oil will go up.
2. So oil prices go up.
3. So demand for oil (and other things) goes down.
4. So oil prices go down.
5. So demand for oil goes up.
(go to step 2)

When oil goes up, its demand goes down, and then oil prices go down. Hence the second derivative of oil prices is roughly proportional to the negative of oil prices. If you write this down as a differential equation and solve it, you get a sine function, a sinusoid. Both demand and oil prices go up and down over and over again. What happened in 2007-9 maybe the first such oscillation.

So now I can't predict much what will happen, so that makes it hard to invest. I don't want to invest in stock funds, only to lose my money in a stock bust like in 2008, but I don't want to hold it in money market funds, have inflation go way high and lose the purchasing power of my money and become a pauper in a multi-million-dollar house. Leeb and Dent have their ideas as to what to do, and they are as different as night and day. Dent says invest in bonds, money market funds, and Treasurys. Leeb says invest in commodities, such as BHP Billiton stock. I will be watching the market carefully to see which way to go.

A Tale of Two Tsunamis

2008-10-23T08:52:00.000-07:00

One of the most misused words in the English language right now is tsunami. You almost never heard of the word until late 2004, when the most powerful tsunami of our lifetimes struck the Indian Ocean off Sumatra, killing 220,000 people in several nations. Ever since then, people have used, overused, and misused the word repeatedly to describe any kind of a great change or event. Everything's a tsunami nowadays. If instead, a half-mile-wide asteroid had struck Sumatra killing 220,000 people, everything now would be an asteroid strike. Especially galling is the use of the term to mean the coastal wave that floods and demolishes coastlines during a hurricane (or typhoon or cyclone). That's a storm surge, not a tsunami.

So here we have two people using the word tsunami to mean something, namely Jim Kunstler and Alan Greenspan. In his Clusterf_ck Nation Chronicles for this week, Mr. Kunstler describes this whole credit crisis as a tsunami. He said that what we are seeing now is the withdrawal phase of a tsunami, namely the deflationary recession that seems to be developing as a result of so many mortgages foreclosing and the resultant credit freeze. He compares it to the hundreds of feet revealed by the withdrawing waves of the ocean, describing the flotsam and shipwrecks that are revealed. Then he says that the tidal wave part is coming, namely runaway inflation, and that will wipe all the financial stuff clean. He says that all the money that the Fed put in will come sloshing back. I am not too sure that such an inflation will result, but it seems plausible to me. In any case, he used the word tsunami properly.

Not so Alan Greenspan. Today he said, "We are in the midst of a once-in-a century credit tsunami". He then says, that whatever regulatory changes are made, "they will pale in comparison to the change already evident in today's markets." But he does not show how the credit crisis is like a tsunami. Nowhere in his words do I hear him speak of a withdrawal phase and a tidal wave, and nowhere do I see any other valid reference to a tsunami, other than it is a big change. He is one of these people that use tsunami to explain anything and would have used "asteroid strike" instead if the great destructive event of late 2004 had been an asteroid strike instead of a tsunami.

So please use tsunami sparingly and properly, and beware of upcoming inflation that could destroy the economy in the next few years.

Will Football Bring Peak Oil to the Nation's Attention?

2008-09-26T20:29:00.000-07:00

We have known for many years now that not only is oil a finite resource, but that production of it will peak sometime in the Ut-Oh (00) Decade, after which supplies will decline while demand is still rising, causing major adverse consequences. But no one ever seems to talk about it. All the politicians, including Senator Obama tonight, speak of energy independence from rogue nations, and expect too much out of other sources of energy. Everything else, including Iraq, the nuclear desires of Iran, Israel, health care, global warming, mountain removal, and the Presidential election campaign seem to be more important, at least in the eyes of the media.

The latest financial crisis is an example of this. All kinds of attention has been applied to the crisis, and people have warned that another Great Depression will result if the Great Bailout Package of 2008 is not passed quickly. That may very well be true, since I see firms, such as Bear Stearns, AIG, Washington Mutual, Lehman Brothers and so forth fail left and right. But we have been through this in the last Great Depression, and we know what the solution is, and it will be applied.

The whole thing is masking the real danger to our future: Peak Oil. What happens when the oil and gasoline run out?

We may find out this weekend. There is an event coming up which will bring attention to the media and the nation as a whole. Hurricanes Gustav and Ike have disrupted oil and gasoline production at a time when gasoline supplies were low and when there is almost no slack in the system. Major shortages have now appeared in the Southeast, including many of the cities that I have visited in recent years to go to conventions: Atlanta, Knoxville, Charlotte, and Nashville. Nashville is said to have only 15% of its gasoline stations open. Still, this is regional, and gasoline will come back.

Enter Football. This is the sport which takes even more public attention than Iraq, global warming, or the election. It seems that global warming and Iraq take priority over Peak Oil, and further, that Football takes priority over these. What happens when the Georgia Bulldogs meet the Crimson Tide of Alabama is far more important than how the financial crisis is resolved and certainly more than Peak Oil.

Well this weekend, Peak Oil may effectively trump Football. There is a gasoline shortage in Athens, Georgia, home of the Bulldogs. What happens when zillions of fans zero in on Athens to watch this Great Game of the Year? It will run the stations out of gasoline and people will not be able to go to work on Monday, that's what. And that is when the nation will find out about Peak Oil. A petroleum executive has recommended cancellation of the game; that in itself would be a significant event, but not one to bring attention to the American public. Besides, Governor Sonny "Chicken" Perdue has called the idea "ridiculous". We will see what ridiculous is when the following events happen.

Hordes of fans from Georgia, Alabama and other states descend upon tiny Athens to watch the game, guzzling gasoline at pumps along the way. The fans run the pumps out of gasoline. Many fans can't finish the trip. When the game is over, everyone tries to go home, but can't because the pumps are all dry. Thousands of cars run out of gasoline on the highways, producing scenes reminiscent of the end of Persian Gulf War I or out of Deep Impact, the movie. The authorities can't get these cars out of the way, because they don't have the gasoline to do it with. In fact, the police can't even do their normal patrols, and so unruly crowds develop and loot and pillage Athens and the surrounding area. When Monday morning comes, thousands of residents can't go to their jobs or do their business; Athens shuts down. A week later, when food trucks can't get through, food shortages develop and a possible famine may occur.

I am not saying these events will necessarily occur. But if even only some of them occur, maybe the newscasters and media harpies will pause on the financial crisis a bit and take a look at what is happening in Athens, Georgia. And maybe then the entire nation will realize what Peak Oil is and what it means about its future.

Ill-Conceived Taxpayer Revolt

2008-09-21T14:20:00.001-07:00

I now hear from CNN that taxpayers are revolting against the bailout plan. They object that why should they pay for the mistakes of all these fund managers and banks? I can see to some extent their anger. We pay the government taxes, then the government gives this money over to mismanaged companies. One person says, "The government does not have $700 billion dollars. WE have $700 billion, and it is being taken from us." Another one says, "Stop blogging, posting comments, and call your congressman."

This now reminds me of the American Revolution. That Fourth Turning was started by anger by the people over taxes, although the rowdy devil-may-care attitude among the youth of that era was a contributer. I do not think the Fourth Turning that is now occurring will be like the American Revolution.

As I said in my previous blog, it won't be like the Great Depression either. This is because people will do it a different way this time, and there are protections now that weren't there in 1929. Instead of standing aside, preaching about prosperity around the corner, and letting the free market freely take down all the stocks and all the banks along with it, we are now bailing out all these companies and holding the line on the market threat. I believe Mr. Paulson says if we don't approve of this proposed $700 billion bailout package, the result will be disaster. I believe he is correct. In fact, if we don't pass this, a repeat of the 1930s Depression will occur. These people that are complaining about the government robbing them with these deals are probably not old enough to know what this Depression was all about. 62 is a pretty old age, but if you are 62 years old, you have never experienced what this Depression was like, and neither has anyone younger. We forget because those who were around then are few and not speaking up as loudly as they were.

So now is not the time to be self-righteous about how the Government is robbing you of money. We need to support the current efforts at trying to keep things afloat. Congress needs to pass this emergency measure! If they don't, the Dow will plummet 1000 points in one day, and you can prepare to see much of your life savings disappear. Of course, those who run the companies need to be thrown out, but let's keep the companies afloat so we don't have another 1930s Depression.

Write your Congressman, and tell him you support the plan.

Is This the Fourth Turning?

2008-09-21T14:15:00.000-07:00

There is a theory of history by Neil Howe and the late William Strauss that says that since there are four periods of a person's life (childhood, young adulthood, midlife, and elderhood) and four types of generations (Prophet [Boomer], Nomad [Gen X], Hero [Greatest Generation, Millennials] and Adaptive [Silent]), there are four types of periods of history, called the First, Second, Third, and Fourth Turning. The First Turning is a societal high, wherein everything works well and people supported the community. The Second Turning is a time of social turmoil, wherein the Prophet generation challenges the precepts of those in power, causing social changes (for example, civil rights legislation). The Third Turning results from this and constitutes a period where the individual is prominent and society falls apart. The Fourth Turning is one of crisis when people restore the order and one way of life dies and another is born.

The latest First Turning was the 1950s and early 1960s, culminating in John F. Kennedy's Camelot. The latest Second Turning was the youth rebellion of the 1960s and 1970s, when youth protested the Vietnam War and how the Greatest Generation was handling things. It also was a period of financial turmoil, when two gas crises occurred and a period of lagging stock prices prevailed. The latest Third Turning was the Culture Wars of the 1980s, 1990s, and early 2000s, when people did their own things, building credit card debt, obtaining subprime mortgages, and driving gas-hungry SUVs. The question is when the next Fourth Turning will occur.

Such a turning starts with a catalyst that causes a crisis. The 9/11 attacks were not such a catalyst. It was instead a heralding event, similar to the Boston Massacre, the Dred Scott Decision, and the sinking of the Lusitania. Katrina was not such a catalyst. But the present financial crisis may be such a catalyst. It started on 2007 February 27, with the collapse of the mortgage market, leading to a buyout of Countrywide Financial. The crisis simmered for a while, causing a downturn which caused oil prices to slide back. It then broke out in full force in the week of September 15-19 with the bankruptcy of Lehman Brothers, the buyout of Merrill Lynch, and the government rescue of AIG.

This is somewhat surprising. I thought for sure that peak oil would be the catalyst, but it's possible the mortgage crisis was caused by peak oil. In any case, it appears to have come. The mortgages were the "spark" (Strauss and Howe) that turned into a Crisis. They say that it will be a long time with us, another sign that this is it.

If this is the Fourth Turning, then how will it proceed? The last one started with a Great Depression. That was caused by the laissez-faire, let the market resolve it attitude of the Republicans of that time, including Herbert Hoover. Once FD Roosevelt got into power, he used the powers of the government to turn this country around. We all have knowledge of this Depression now, although you have to be at least 75 years old to have felt the effect of it. In this day and age, if you are at the retirement age of 62, you have absolutely no experience of what things were like during the Great Depression.

However, knowledge of the Depression is affecting events, and my feeling is that this will not be a Great Depression, at least not in the way that the 1930s was. That is why all the bailouts. Every time something that will crash the economy and cause a big Depression threatens (e.g., the failure of AIG), the Government comes in and bails it out. This is one way of handling it. Will it work?

The problem is that for the past few years, with reckless Third Turning abandon, we have been living off money that does not exist; for example, high credit card debts and unpaid mortgages. This present crisis is now people and the system recognizing this fact. The problem is how to fairly distribute the non-money so that it does not cause trouble. Repeated government bailouts will spread it out among all of us by increasing the federal deficit. This will be made up by higher taxes, reduced benefits, or more likely by the Government simply printing more money. This means inflation is headed up, meaning that a serious hyperinflation may be headed our way. The "Mother of all Depressions" may resemble Germany in 1923 more than it does the US in 1932.

In the near future, this crisis will gradually get resolved, and another boom may occur next year. People will feel better about themselves and the market, and once again prosperity will occur. That's when Peak Oil will confront us. The new prosperity will undoubtedly increase oil prices, and may cause them to increase dramatically. Sooner or later we will have to deal with the problem of declining oil supplies. We will need to conserve in the years ahead, even if we get all these alternative sources to work.

The Five Biggest Problems in the World, Reconsidered

2008-07-29T12:14:00.001-07:00

Among all of my blogs, the one I posted to Cliffhanger on 2006 July 26, entitled "The Five Biggest Problems in the World Today" has received more comments than any other blog I have made. Apparently people are interested in world problems, and I think it is good, because that means that there is some hope for the world after all. The problems I listed were:

1. Peak Oil
2. Global Warming
3. Retirement of Baby Boomers
4. Prevalence of Mainline Religions
5. Discrimination

The most recent call, from AndimsoNice, accused me of watching too much CNN. I certainly did not get Peak Oil from CNN. You still get little about this major problem in the news media, even though oil prices are $4 a gallon, the airlines are having major problems, and there are food and fuel shortages throughout the globe. However, the three problems AndimsoNice mentioned are indeed serious ones, so let's consider them. Here they are:

1. Clean drinking water
2. Genocide
3. Food shortages (not foot shortages!)

1. Clean drinking water. Indeed many places in the world are experiencing fresh water shortages. Georgia, a state in the US, is one of these. Some of the lakes have almost gone dry recently from the shortage of water there. Water is a renewable resource, but only so far. After the population grows above a certain point, it consumes more water than can be made available by Nature, so then it becomes non-renewable. Also, water is non-renewable in places where it is scarce; in other words, the deserts. Cities such as Almaty, Phoenix, Timbuktu, and Urumqi are going to have serious problems in the future because hardly any water falls from the sky at these places. They have to rely on rivers or aquifers, which will dry up if population grows rapidly, as it is doing in Phoenix, and perhaps in Urumqi. Global warming caused by fossil fuel consumption is creating more desert and exacerbating the problem. I call this problem the Water Limit, rather than Peak Water, because we don't produce water; there can be no peak production. Another problem lies behind both Peak Oil and the Water Limit, and that is population growth. Ultimately, the human population will have to stop growing.

This problem is a serious one, and I really did not list it, but it does relate to Peak Oil and Global Warming.

2. Genocide. Why do certain people or tyrannical rulers want to kill entire populations or ethnic groups? I think it is because of this "we vs they" mentality. If people are dissatisfied with life, a tyrant can seize on this dissatisfaction and whip up hatred against another people, as Tutsis against Hutus or Germans against Jews. Religion makes the problem worse, as if people were houses, God would be an unoccupied property, and sooner or later, this tyrant will occupy that house and become God. Belief in one self and in those around you may be the best way to help combat genocide. Certainly if genocide exists, it needs to be wiped out, either by the victimized people or by others; for example, our troops should not be in Iraq and Afghanistan but in Myanmar and Sudan.

In any case, Peak Oil will make this problem worse, as people will say that we are running out of oil, so make sure we get it and not those barbarians over there. This problem is related to both Peak Oil and Discrimination, since committing genocide against a people is an extreme case of discriminating against them.

3. Food shortages. Population growth is strongly behind this one. If there are more mouths to feed, more land is needed to grow the food for them. Peak Oil is also strongly related to this problem. In fact, this may be one of the worst effects of Peak Oil. Food is grown for the world today in such bountiful places as Iowa and Brazil, but to grow this food requires oil to transport the food to where it is needed, to operate the farm machinery to grow the food, to make the fertilizer for the crop and so forth. About 90% of the cost of food nowadays is oil. And so food shortages will appear and get worse as oil production declines.

This problem is so related to Peak Oil that I include it as part of this problem.

So now I rank the problems of the world as follows:

1. Peak oil and Food Limits.
2. Global Climate Change and Water Problems
3. Retirement of Baby Boomers
4. Prevalence of mainline religions
5. Discrimination and genocide

She's Real Fine, My $4.09

2008-07-06T20:40:00.001-07:00

It's been a while since I blogged here, so I will do it now. What I see right now is a price of crude oil that keeps going up and up with seemingly no stop. The last time I saw it, on the Fourth of July, 2008, it was $145/barrel, or $3.45 a gallon. That is about the price of wholesale gasoline, and retail gasoline just recently hit $4.00 a gallon here in Virginia. That's right, $4 a gallon is here.

The national average is $4.09 a gallon. She's real fine, my $4.09, my $4.09. No, that wasn't what the Beach Boys meant when they sang their song about a hot rod car called a 409. That was back in the 1960s, when oil was plentiful, summers were endless, and were spent surfing at the beach and chasing all the girls, especially California girls. I looked up in Wikipedia to see just what a 409 was. I was not interested in beach music back in the early 1960s, and I could have cared less, and only know of the song because my brother played it all the time. I couldn't imagine it was a horse, despite the lyrics ("Giddy-ap, Giddy-ap, 409"). There was a brand of Chevrolet back then (i.e, not a hot rod but a schlock rod, like Mickey Mouse - that came from another song during those days) with a 409-cubic inch engine. That's 6.7 liters! Wow! My gas-guzzler Plymouth Voyager has at most a 3.0-liter. There was a Beach Boy mentality back then that said this would go forever.

We now know differently. There is only a finite amount of oil on this planet. Apparently there were 2 trillion barrels of oil in this planet, and 1 trillion has been pumped out. So therefore, a peak in production can be expected, and many analysts think it was somewhere between 2005-2008. The high price of oil and gasoline is causing Americans to cut back, but Indians and Chinese are still continuing to increase their use of oil. Now people are wondering when shortages will occur. I think they will not occur for some time. The shortages of the 1970s were caused by regulations on gasoline prices. There are none now, so instead prices will skyrocket. Those who have the last buck, instead of the last place in the gasoline line, will do without.

So what do we do? A mixture of developing new sources of energy, such as solar, wind, and batteries for cars, as well as conservation, is what will work in the long run. It is pointless to dig the ANWR, drill off-shore, or tear up Montana and Wyoming in search of oil for shale, since these are still non-renewable resources. We are already doing that. If it doesn't work we need to do something else.

And something else we need to do. I fear for what will happen if shortages develop and people have to do without. The Beach Boys sang about the 409; they have another song about a Thunderbird, which symbolizes our oil culture: "And with the radio blasting
Goes cruising just as fast as she can now, And she'll have fun fun fun 'til her daddy takes the t-bird away" When will Big Daddy Peak Oil take our fun away?

The Peak Oil Bomb Deal

2008-05-06T16:56:00.001-07:00

OK, here is my deal. There are many indicators that are saying that we have passed the world production peak of oil, including the ever-rising price of oil, now at $121 a barrel, food shortages worldwide, high prices of food in the United States, and the increasing trouble with the airlines (although some of this is due to max airline capacity, hit in 2000 and again in 2004). This threatens the way we live and perhaps even world civilization. So are the US Presidential candidates talking about it? You would think they would.

The truth is that I have heard just about nothing from any of the three of them about peak oil. Not a word. Michael Moore is now talking about it, and I wish he would make a movie about it. But not the Presidential candidates. Barack Obama is pointing the right way by saying that a gas tax holiday won't help, but he has never talked about it directly. John McCain came within a hair's breath of mentioning it. He said that the Iraq War was fought because of oil. If he meant the second one, he is correct. However, all the pundits and hypermediots ganged up on him, and he was forced to recant and say that it was about weapons of mass destruction. John, you blew it. You really blew it. If you had maintained a peak oil stance, I would have voted for you.

But right now as it stands, I favor Barack Obama and will vote for him in November if he is on the ballot.

However, Presidential Candidates, I am throwing this deal at you. Kenneth Deffeyes said recently that "My only hope is that a candidate, who learns from private polls that he or she is behind, will drop the oil bomb into the debate." I will vote for whichever candidate drops the oil bomb into the debate. It doesn't matter whether it is Barack Obama, Hillary Clinton, John McCain, or even someone else, provided they are of a major party and have a chance of winning. If you start talking about peak oil, I will vote for you. Else I will vote for Obama or Clinton, whoever is running and hope for the best.

So there's the deal, Barack, Hillary, and John. What you do is up to you, but the world depends on it.

Obama Forced to Apologize

2008-04-14T20:23:00.000-07:00

Yesterday my companion blog Beyond Opinion posted something called "Bitter, Indeed", in which it says that Barack's "bitter" comments don't matter at all and that Hillary was the pot calling the kettle black when she said that Obama was "elitist and out of touch", citing her high position and her ex-President husband. it seems that Obama made a mistake in calling Pennsylvanians bitter with belief in God and guns and wanting to do something about immigrants. This sounds funny. It seems like I am talking about myself, since I am the author of both Cliffhanger and Beyond Opinion.

But anyway, today I found someone who supports what Obama said, none other than peak oil blogger Jim Kunstler, author of the "Clusterf*ck Nation Chronicles" blog. In this blog, he said that Obama was brave enough to tell the truth about Pennsylvanians, and in fact about people in general. He agreed with Obama that "cling to guns or religion or antipathy to people who aren’t like them". He then said that the press and Hillary and others ganged up on him and forced him to apologize. Jim said that he should not have apologized and that he lost authority by so doing. That is important. Obama carries charismatic authority, and that is essential to his performance as a Crisis President the next few years. I hope he gets over being blasted by the media, by Republicans, and by other Democrats when he takes office. He needs to tell us a lesson.

This is the same one as Kunstler has been telling us all the time lately, namely that we must get away from driving cars so much and that we have to be prepared to live life dramatically different in the years ahead. Kunstler is thought of as a radical for saying these things, but what else can you conclude when you look at the oil and fossil fuel supply picture? Plus add in the credit crisis and retirement of baby boomers, as well as Iraq and Iran and you see where Kunstler gets the name of his blog.

Kunstler also says that Clinton is the pot calling the kettle black. Carville is a Clinton supporter. I got a request for funds from him today for the Democrats. I threw it out. No way. For Carville said the same things Obama said, in a more picturesque way, that Pennsylvania was a redneck sandwich, with Philadelphia and Pittsburgh the two pieces of bread and with Alabama meat (redneck meat - an interesting concept) in between. Kunstler also decries people not coming to the defense of Obama. Finally he concludes that the election and the serious problems of the future matter a lot more than whether a "cohort of Cheez Doodle addicted rural Pennsylvania morons prays out loud for God to shoot all the Mexicans." Jim makes them sound like idiots. Today's song, as William Faulkner says, may be that of an idiot full of sound and fury.

We may see some sound and fury soon.

It's Already Here, Jim Kunstler

2008-03-31T18:05:00.000-07:00

In his Clusterfuck Nation Chronicles of 2008 March 31, Jim Kunstler comments on his ordeal with the world aviation system on a recent trip to the American West. He says that high fuel costs, caused by Peak Oil, are killing them, and they can't fire any more employees or gyp employees on their retirement benefits. He then says, "For now, they slump like war refugees in the blow-molded plastic seats, numb with fatigue, anxiety, and disappointment. But I wonder if there will be riots in the concourses sometime later this year."

Guess what, Jim? It's already happened! It happened at Buenos Aires, Argentina's Ezeiza Airport on 2008 January 12. MSNBC reported it. Just click on MSNBC you will see how frustrated passengers, stranded two days by a strike, revolt against the airport, destroying computers and other toys of the Communications Age. It even includes a video. It may be caused by a strike, but I suspect the strike was caused by reasons having to deal with Peak Oil, such as high demand and low supply. The union said the stranding was caused by overbooking, trying to cram more cash-paying passengers per plane. So here comes Peak Oil. This one's already happened.

Peak Coal in South Africa?

2008-01-25T16:51:00.001-08:00

This week certainly was a roller-coaster on the stock market. Down 300, down another 300, then up 600, and now down 200. Gold went down in price during the week, but near the end, it suddenly jumped up to $913 an ounce, the highest I have ever seen it. With energy shares and more general shares going down, I wonder why gold would shoot up in price. I found out why today.

There is a shortage of coal in South Africa, as can be seen in many articles, including this one. This shortage has gotten so severe that the government is asking industries to cut back, and as a result all gold and platinum mining in South Africa has ended. So this explains the higher gold prices. But what about gold companies?

I checked a few that made up a gold fund that I have invested in. All mine from the Americas, Europe, or Australia, except Gold Fields, which is a South Africa company. All of the stocks went up today except Gold Fields, which went down.

But it makes me wonder about coal. People say that coal will last hundreds of years. I did a calculation recently and came up with 161 years, assuming linear growth rates. So why did this shortage occur? And will the rest of the world eventually be like South Africa? I hear recently that Virginia hit peak coal in 1996. So Virginia must be importing from other states. Will the world run out of coal soon?

So right now there are two reasons why gold investing is good: the current economic downturn and coal shortages in gold producing regions.

Stocks are Down because of OIL

2007-10-15T13:28:00.001-07:00

Today, 2007 October 15, the major stock market averages were down. In particular, the Dow Jones Industrial Average was down 108.28 to 13984.80; the NASDAQ was down 25.63 to 2780.05, and the S&P was down 13.09 to 1548.71. Why did the stock averages go down? The analysts on CNBC and other places have come up with a number of reasons. The financial stocks all went down, so therefore, they say, they caused the market downturn. We aren't out of the housing crisis yet. They are awaiting the Fed's next move. Earnings of companies are down. Bladada blah blah blah.

No, people. None of these are the reason why the stock market went down. If you will get your head out of all these mathematical models, computer programs, and analysis diagrams, and take a look at some real things, you will see the answer. Gold is real. It is element 79 with symbol Au. The Gold Bugs index (^HUI) was up 5.43 to 418.77, a 1.31% increase. Oil is real. You can never run out of money; you can just print more. But we can and are running out of oil. The AMEX Oil Index (^XOI) was up 15.43 to 1495.47, a 1.04% increase. Why? Because the dollar continues to sink. But more likely because oil continues to go up in price. It went up $2.44 or so today to $86.13, a new high, and only about 14 dollars removed from $100 a barrel.

Why? Oil stocks (meaning supplies) are down. The Energy department had expected them to go up. The International Energy Agency also reported a decline in world supply of oil. OPEC is saying that it will produce 110,000 fewer barrels this year than expected, when it expected a raise. World production of oil reached about 84 billion barrels a day in 2004, nearly a thousand barrels a second. Since then it has been holding steady. Four of the world's largest oil fields, namely Ghawar in Saudi Arabia, Daqing in China, Burgan in Kuwait, and Cantarell in the Gulf of Campeche near Mexico, are starting to decline, some precipitously, as Cantarell, which furthermore got hit by two Category 5 hurricanes this year.

That's the reason why stocks fell. It is also the reason why gold and oil stocks went up, and why the price of oil is up. Our civilization is beginning to run out of cheap oil. To me it looks like prices are going to go up. At $86 a barrel, gasoline prices should be $3.02 in southern Virginia; instead they are around $2.55. There is nowhere to go but up for these prices. Further, especially if prices don't go up much, shortages could develop. And then there will be a big outcry. The outrage at being fooled on the supply of oil will more than exceed that of finding out that there were no weapons of mass destruction in Iraq.

Dean Threaten's Mexico's Oil Output

2007-08-21T11:51:00.000-07:00

None of the media outlets have been telling us that the world's oil supply is threatened by Hurricane Dean. Dean is heading straight towards the Cantarell oil field, which has been failing as of late but still produces 1 million barrels of crude oil a day. Don't be surprised to see oil skyrocket after tomorrow.

Also, the sea ice has been melting at an accelerated pace, verifying that fact that global warming has been occurring.

See my other blog Beyond the Wind for more details.

Sixteen Tons and Polar Bear

2007-08-17T14:44:00.001-07:00

Someone was singing Merle Travis' "Sixteen Tons".

Coal Miner: "You load sixteen tons."
Polar Bear: "No, don't! Don't load sixteen tons."
Coal Miner: "But if I don't load sixteen tons, I won't have anything to eat."
Polar Bear: "If you load sixteen tons, I won't have anything to eat."

Branner Station

2007-08-16T19:29:00.001-07:00

I hear there is a meeting of the Chesterfield County's Board of Supervisors on 2007 August 21 at 7 pm. One of the cases being considered is Branner Station, a development in southern Chesterfield County bordering Branders Bridge road. Of course this is a bad name for the development; it will be confused with Brandermill. The developer, HHHunt, calls for 5000 homes on a tract of 1449 acres, which is about 2.5 square miles. With peak oil coming up and no businesses near the site, I wonder why HHHunt wants to build such a large monstrosity in the county. He says it will take 20 years to develop. Maybe we should call the developer HHHHHHHHHHHHHHHHHHHHunt.

I read an editorial in the Chester Village Voice which suggests that this development will be built along the lines of something called "Smart Growth". That is, the development will take care of such problems as inadequate roads and schools. The developers plan to construct a road through the development and to improve Branders Bridge road, which was designed when horses were the main means of transportation. They plan to construct a school or to provide for the construction of the school on the grounds of the development. There will be a retail area, a park, and some trails. These are all in accordance with Smart Growth.

Fine. However, Smart Growth is still growth. That is one thing that Chesterfield (and indeed the entire world) does not need now. We already have too many developments here. How are the people in Branner Station going to travel once gasoline becomes really expensive, or even unavailable? How are they going to get food? Do they allow for residences to grow vegetables in suitable plots? How is this planned development going to shorten commutes for these people? Many of the residents of this development will probably go to work at Fort Lee, which is doubling in size due to base closures and cutbacks elsewhere. Fort Lee is a 25 minute drive from the area, and will get longer as population grows and traffic lights proliferate.

I think the county needs to reconsider Branner Station. HHHill has done about a 50% job in coming up with a good development design. But he and his people need to read up on peak oil, zero growth, permaculture, cohousing and other housing alternatives before coming up with a new design that takes these future trends into account.

Drop the Bomb!

2007-07-23T10:42:00.000-07:00

After a six-month hiatus, I have finally found new input on Kenneth Deffeyes' peak oil blog, at http://www.princeton.edu/hubbert/current-events.html. He reiterates what he has said before, with figures to support him in Excel spreadsheets. The peak of conventional oil occurred in 2005 May, and conventional oil production has held at around 73 million barrels a day since then. The peak of Saudi oil has apparently been hit at the same time, at about 9.6 million barrels a day; it now has shrunk slightly to the 8 millions. This is only conventional oil, apparently. Adding in unconventional sources raises the total to 84 million barrels a day, and this has also held steady for the past couple of years, indicating this peak has been reached.

I feel no change in my lifestyle, however, other than a constant carping at my church and other places to cut our carbon emissions. This may be cutting demand slightly. But there are some who say that the demand is the same as in the past few years, despite increases in demand from China, India, and the US, because third world countries like Zimbabwe can't afford it any more and has quit buying it. This plateau will last for a while, but will be followed by a decline, and I am not sure what is going to happen after that. I think that supply and demand will play a big role in holding back the ill effects of peak oil, reducing demand by making human life here in the states more efficient and bringing solar, wind, clean liquid coal (if there is such a thing) and nuclear power into the forefront. But eventually, a great depression may await us as we gradually run out of power to run our society as it is presently constructed, sometime in the twenty teens.

This should be a major issue in the 2008 Presidential campaign. But it is no issue at all. Some of the Democrats bring up global warming, but that is not the same thing. Kenneth Deffeyes notes this and says: "It looks as if we will go through another US presidential election with no candidate calling attention to the world oil problem, or to the North American natural gas problem. My only hope is that a candidate, who learns from private polls that he or she is behind, will drop the oil bomb into the debate."

This matter needs to be discussed. Almost nowhere in any of the debates have I noticed any of the political candidates talk about peak oil. They need to talk about it. So this is my message to the candidates, especially those who are not leading: Drop the Bomb!

Sell?

2007-07-12T19:03:00.001-07:00

Today, 2007 July 12, in his Clusterfck Nation Chronicles, Jim Kunstler said this in his "Daily Grunt":

Go figure. The Dow Jones is up over 100 points at 10:30 a.m. in the face of the following headlines:

U.S. Trade Deficit Widened 2.3% in May to $60 Billion
U.S. Foreclosures Increase 87 Percent as Prices Fall
Al-Qaeda Is More Capable of Attacking West, U.S. Report Says
Crude Oil at $73.48
Euro at $1.3773
More Subprime Woes to Come

Seems as though the bulls ran wild today. The Dow was actually up 283 points today. Yet Jim points out all these ominous events, including record foreclosures, rising oil prices, and Al Qaeda on the jihadpath. Sort of like a victory party on the Titanic.

Is Jim trying to say this is a Sell signal?

Cooling Dance

2007-07-09T05:53:00.000-07:00

On 2007 July 7, many places around the world celebrated Live Earth Day. At my church, we had a combined meeting of the Chesapeake Climate Action Network and Moveon.org that attracted many people from my congregation, featured what people, including Democratic Presidential candidates, would do about global warming, and even featured an actual product: an LED lamp.

But was Live Earth in general a success? Jim Kunstler doesn’t think so. In his Clusterf nation Chronicles for today, "Rain Dance", he says that the event was dominated by all these rock bands strutting out their stuff making loud noises that consume electricity. That is what some of us thought at First Church when the TV turned towards what was happening elsewhere for Live Earth Day. Actually, one might call Live Earth a Cooling Dance.

You cannot do anything about peak oil or curb global warming with prima donnas playing rock music all over the place to mesmerized audiences. What does this rock music have to do with global warming? These stars could eventually allow a dictator to make use of these crowds of "fans" to take absolute power.

And what's Al Gore doing anyway, says Jim Kunstler. Why does he make movies like the prima donnas do and wail about global warming instead of getting somewhere where he can do something about it? Why doesn't he run for President?

Localize Fireworks

2007-07-04T16:56:00.000-07:00

Every year at this time I go out into our development to see fireworks. I run or walk out among the streets hunting for fireworks displays. In past year, I have seen some impressive displays from people of our neighborhood, and I expect to do the same tonight. A problem is that these displays in many cases are illegal. They can also be dangerous and all the authorities are telling us not to do it and instead go to a public display. Indeed they can be dangerous. You need to handle them as if it could go off at any instance a flame is nearby. They cannot be handled by children and require adult supervision. But I still go out and see these displays.

Of course I could go see one of the public fireworks displays in the community, but the joy of seeing these fireworks is diminished by the traffic jams and parking problems that come with these displays.

Indeed that is a major problem of these displays. People every year get into their car or SUV and drive to a public fireworks display, causing parking and traffic problems, when so many people jam into such a small space. They consume huge amounts of gasoline, especially if they get stuck in displays. They go to the parking lots of big box stores such as Wal-Mart to watch a few fireworks ascend about 15 degrees above the horizon from some place far away.

Peak oil tells us there may be a day soon when we will not be able to drive all over the place for the pleasure of seeing pyrotechnic stars blaze in the heavens. What will we do then? All these years I go in the neighborhood to see local fireworks display, I run or walk - a good way to get exercise in too. I urge all of us to try that this year. It's a way of localizing fireworks.

A lot of other things will need relocalizing as well: growing food, getting medicine and health care, buying consumer goods, and celebrating community with the people around you. Until that day happens, at least we can enjoy fireworks and not get into traffic and parking hassles; see them locally.

Americans for Balanced Energy Choices Signs People Up Without their Permission

2007-07-03T07:28:00.001-07:00

Yesterday I received in the mail a letter from the Americans for Balanced Energy Choices (ABEC) (Warning: Music). This letter said that I have just joined the organization. Huh? I don't remember explicitly joining such a group. I have been a member of CCAN (Chesapeake Climate Action Network) and my church's Earth Committee. These organizations seek to combat global warming and other environmental concerns through a variety of methods. I went to a conference in Wilmington, NC on global warming. I have been attending meetings of the Charlottesville Peak Oil group, and have been concerned about peak oil for some time. Did I somehow join up for something that I did not remember, or did my signing something get me to be a member of yet another environmental group that fights pollution through oil, natural gas, and coal production, among other things?

I looked at the letter. It talks about providing affordable energy. Good enough. But you can't tell organizations from their own literature any more. That is not where you get the truth. I go to something independent of ABEC; in particular, Wikipedia. Surprise! I find that it is a political action committee promoting the coal industry. I would have never signed up for something like this. Although I think we should consider coal as an option, I know from my own calculations that the disasters spoken of by the global warming people can happen only because of the use of coal. So given this, do you think I would support a group that promotes coal production? That promotes civilizational suicide?

The only way I would support coal production and other coal activities, such as coal to oil conversion, is if it does not contribute to carbon dioxide in the atmosphere and only as a last resort after other actions are taken. This group signed me up without my permission. They evidently seek to sign up people without their knowledge and then say this is a grass-roots effort on the behalf of the coal industry. I beg your pardon, ABEC. This is not grass-roots. This type of lying is more aptly described as Astroturf.

I request, ABEC, that you drop me from your membership rolls, and drop everyone else that you signed up without their permission.

Jim, We Have Someone

2007-06-18T18:39:00.001-07:00

One of the more interesting blogs I have seen on Peak Oil is Clusterfuck Nation by Jim Kunstler. Jim seems more than some of the others to say what he feels is what it's going to be. Some of his predictions have been way off (Dow Jones 4000, instead of the actual 12000), but his general thesis is well taken. People seem to be ignoring the signs of Peak Oil, so maybe someone like him is necessary to get people to listen. One of his points is that such things as Toyota Priuses, ethanol, CAFE standards and the like are merely ways of trying to get us to continue driving like we have been, instead of what he thinks would be better, namely to restructure the way we live and the places we live so we can do with less oil.

In his latest blog ("Both Ways"), he says he would rather have someone who wants us to discourage suburban development instead of pulling the troops home. We have someone, Jim. To me it follows that he would want us to support Dorothy Jaeckle in Chesterfield County, Virginia, who won an upset victory over Jack Wilson, more than Democrats such as Hillary and Obama who want to pull the troops home. At least Dorothy would be a start. She defeated a candidate supported by his boss and by developers all over the place. Her platform, which she documents in a letter (parts of which are here), is that something should be done about unbridled growth and development in Chesterfield County. She put her case convincingly, and won the election easily.

It's a start, but so far she has told us what she is against. What is she for? Hopefully, she will outline a design for the County that will include farmer's markets, design to make the automobile less necessary, and other facets of what is called the "urban village". For we are eventually going to have to adjust to such an environment. The oil may have already hit a peak worldwide, and there will be only less of it as the time goes by.

In the meantime, Hillary Clinton, Barack Obama, and other candidates who yell about pulling troops out of Iraq, about energy dependence, and about bombing Iran should listen to what Dorothy Jaeckle is saying and call for all of us to head in the same direction.

In the meantime, I hope Jim continues his blog, and that his servers stand up better than they did tonight. I could not comment on his blog because of "this page can't be displayed".

Will gasoline hit $4 a gallon in 2007?

2007-04-25T17:29:00.000-07:00

Recently an article by Joe Carroll in Bloomberg said that gasoline prices could hit $4 a gallon this year. This is higher than gasoline has ever been around here. The most I have ever seen was $3.25 a gallon, a few days after Katrina struck, when power outages were preventing local pipelines from receiving fuel. But AAA of Maryland has struck back with an article saying that it is premature or irresponsible to say it will do that. So which is right?

There are many factors influencing the price of oil. Some of the ones Bloomberg mentions are hurricanes, tensions in the Middle East, Nigeria, and other places, supply, and demand from consumers, primarily in the US. Any one of these could cause shortages and cause prices to skyrocket. But suppose everything is OK? For a while, then, gasoline prices will stay in the upper $2s, as things will be mostly OK. There is an economic boom in this country, however, and this will cause demand to heat up. But the major factor, I feel, will be supply. There are some serious problems coming up.

The four biggest oil fields in the world are all declining: Ghawar in Saudi Arabia, Cantarell in Mexico, Burgan in Kuwait, and Da Qing in China. More oil is coming online, but this will be from smaller fields and I am not sure that this increase will counteract the declines in the Big 4. Already Pemex, the Mexican oil company, is showing pressure. It is seeing its profit margins declining, and is fearing for the future. If Mexico should stop sending fuel to the US, it could have a dramatic effect on prices.

So I say there is a possibility of gasoline going to $4, because the world has hit peak oil and world oil production is declining. Sooner or later, the decline will filter down to the gasoline pump.

Calm before the Storm

2006-08-29T14:40:00.000-07:00

Peak Oil? You wouldn't know it. People are talking all over the place about the promise of tar sands, ethanol, and wind power. Gasoline is dropping in price. I had predicted before the summer that oil would hit $95 a barrel and gasoline $3.50 a gallon. Summer is nearly over. The price of oil at its highest was about $78 a barrel and right now it is struggling to hold onto $70; gasoline is tumbling rapidly from a high of $2.95 a gallon to today's $2.56 a gallon. Iran's dictatoriot Ahmadinejad seems all huff and puff like a wolf that can't blow the house down. There's been a war between Israel and Hezbollahia, cohabitant of Lebanon, but that appears to be blowing over. The far prognosis for natural gas is grim, but right now there is a tremendous glut of the stuff. Hurricanes? This has been a dud of a season. Only now are threats coming up, but the latest one, Ernesto, has diminished from a potential Gulf rig and refinery whacker to just another thunderstorm with rain and tornado threats here in Virginia. So where's the peak oil? Where even is global warming?

It's coming. We don't know exactly when, but there will come a time when the world will not be able to increase oil production. Someone at the recent ASPO convention says that will occur 1500 days from 2006 July 26 or so; that's in the year 2010. Others say 2008. When it happens, they say, only "tremendous demand destruction" will cause demand to meet supply. In the past few months, oil production worldwide has stayed steady at 84 million barrels per day, but some of that could be the result of refinery destruction. But it also suggests we may be nearing the peak. We have trouble with the Alaska pipeline, although half of it is back up. They say that Saudi Arabia is experiencing trouble trying to match oil output with its rhetoric.

So this makes us all feel uneasy. What to do now? Move to the city? Grow a vegetable garden in our yard? Buy a Toyota Prius or a bicycle? Move closer to work? Stock up on food? Is this a disaster or something? It will be, but not of the kind that stocking up for disasters will help, because it will be long lasting. My thoughts are that we should reduce our output - take out all that is unneeded for fulfillment in our lives. Cut the lights. Ride the bike. Take the train. Move to the city, or even better yet, to a self-sufficient urban village or cohousing project. We do what we can, and we will just have to see what happens.

Credit and debit cards at pumps could lead to disaster

2006-08-01T19:26:00.000-07:00

How do I pay for gasoline? When I was a child, my father used to go up to a gas pump. A serviceman in a policeman hat would come out and put a pump in the gasoline tank. I would see the digits spin, until the terminate somewhere near $2 or $3. Then my father would pay the serviceman. When I got out of college and owned my first car, I would get gasoline on my own, getting out of my car and putting the pump in and pumping until it said something like $10. Then I would go into the establishment, which was now a small grocery or convenience store instead of a auto service station, and pay the $10. I would get gasoline like this all the way until well into the 21st Century.

Then a change occurred. I started getting out a card and sticking it into the pump. I now follow screen instructions, pumping in the gasoline, and getting a receipt. That is how much my credit or debit card was charged for the gasoline. Then I would drive away without having to go into the store. Usually the amount is now $25, or for my van, $45. How times have changed.

There is a danger here. As long as people went into the store or paid someone cash, higher gasoline prices would crimp people's desire to drive places. This would cause a needed decrease in demand, and a drop in gasoline prices. But if people are going to stick cards in machines and build up charges on a credit card, people are not going to conserve. The direct association between gasoline and money is no longer there. Drivers don't worry about money until their credit card bill comes.

And then people react in the usual way they react to credit card balances. They pay the minimum amount and interest starts accruing. If gasoline prices are going to be charged like this in an era of ever rising gasoline prices, this will cause serious trouble. People will keep charging bigger and bigger amounts as gasoline prices continue to go up. Demand will stay high, furthering bigger raises in gasoline prices. Eventually people will not be able to pay their credit balances, and bankruptcies and defaults will occur all over the place, and this could cause a string of bank failures. This could be exacerbated by inflation, causing the Fed to raise interest rates. In other words, we could have another Great Depression.

People need to start conserving now. Forget the credit card, and pay only with what you got. Else we are heading for a real monster of a financial crash.

The Five Biggest Problems in the World Today

2006-07-26T19:00:00.000-07:00

You hear a lot of stuff happening on the news and elsewhere nowadays. People are fatter than they were 10 years ago, gasoline is $3 a gallon, Israel and Hezbollah are having a free for all with each other, the Iraq conflict is continuing on and on and on with no end in sight, hurricanes threaten Gulf of Mexico oil supplies, sex offenders maraud the landscape and so forth. But what really are the biggest problems we face today? This is important because some theories (Periodic Presidents, the Fourth Turning, and the Great Turning) are saying that a major crisis period may be coming shortly. If so, what's going to cause the crisis? I think it is likely to be one of these five problems that leads to the crisis, and I will enumerate them in terms of their likeliness.

5. Discrimination. No, it didn't end with Martin Luther King and the civil rights movements of the 1960s. We still see it nowadays, in the destruction of a gas station because its owners wear turbans (Sikhs), the murder of a gay man in Wyoming, and even in the way we associate with people in our everyday life. Discrimination is alive and well. It would help if everyone would recognize the worth and dignity of every person.

4. Prevalence of Mainline Religions. This is a large grouping of related problems. The problem is that mainline religions, such as Christianity, Islam, Judaism, Hinduism, Jainism, and so forth, promulgate belief in a higher power ("God") way up there that answers their prayers. "I thank God for helping me through this disaster." What about those that did not survive? Was God with them? Sounds like a retributive God to me. Further, many people and nations begin to make God in their own image. For since the Ultimate Reality is so immense as to be unreachable, the best we can do is make up images that are specific to ourselves, and from this develops the idea of Good vs Evil, with Good being us and Evil being those other guys. From this conflicts develop. Muslims are especially apt to spout off religion in their own name, from the death threats against people who draw caricatures of Mohammad to the majority of people in Afghanistan who want someone executed because he wants to practice Christianity instead. In this country, it manifests itself in forcing us to hear "Under God" in our schools, in demagogues such as Pat Robertson and Jerry Falwell, and in forcing high school teachers to teach non-science, such as creation and intelligent design. I believe that religious beliefs are at the heart of the present crises in the Middle East that threaten the entire world. People need to understand each other before demanding that they be understood, and the world will be a better place.

3. Retirement of Baby Boomers As we go down the list, we get into more serious problems. This one was caused by all the World War II vets who came home and started manufacturing babies and families, creating a population boom that caused schools in the 1960s to rapidly expand, caused a glut of PhDs in the 1970s, a housing boom in the late 1970s. We baby boomers are headed into our retirement years, and when that happens, some nasty things could happen. What happens when boomers withdraw from their 401(k)s instead of putting money into them? Will the stock market crash? Certainly the presence of all these aging boomers requiring care will be a drag on the economy. I suspect people will want to work longer, but this is still a danger signal in the years ahead. It has caused Harry Dent, an economist, to call for the Mother of All Depressions next decade.

2. Global Warming. Or in general, global climate change. All these fossil fuels that we are burning up is spewing carbon dioxide in the air, which prevents sunlight from getting out and causes the Earth to warm up. Al Gore presented the case for this quite nicely in his documentary An Inconvenient Truth. This is a movie that needs to be seen, as Al Gore has presented a convincing case that indeed global warming is affecting the way we live. We see it now, in Hurricanes Katrina and Rita, in some of these storms across the nation such as the Great Northeast Storm of 2006 June and the St Louis Blackout storms of mid July, and in desert-like conditions in some areas and heat waves all over the place, especially the American West and Europe. This is a problem that needs to be dealt with in the years ahead if we are to avoid destructive events. But it is not the biggest problem we face. Al Gore went to all this bother to prepare a first-rate documentary on the Number 2 Problem. We need something like that on the Number 1 Problem:

1. Peak Oil Our whole civilization is based on it. Oil. It is nonrenewable, and the world is near the halfway point. This means that in the years ahead, while demand for oil soars, production of it will decline. This will result in all sorts of havoc if we are not prepared for it. Good descriptions of the problem are available at www.oilcrisis.com and its links, Jim Kunstler's Clusterfuck Nation Chronicles, although the use of the f-word and other such words in his chronicles detracts from the message, Kenneth Deffeyes' web page, and many other sites. Peak Oil is why the price of gasoline has risen from 88 cents a gallon in 1998 to $3.00 a gallon today, and we can expect it to rise further. It is hard to find substitutes - hydrogen has storage and other problems, ethanol has an energy return ratio of 1 or less, there aren't enough wind turbines (although they are easy enough to construct), and solar power is a long way from providing us all the energy we need. We need to conserve as well, by eliminating the use of energy that really isn't needed by us - computers that burn all night long, lights that light up the ground for nobody, and so forth. To me, Peak Oil tops all of the other problems. It will stop Global Warming. It is important enough that, although I would recommend voting for Democrats in general this fall, if you are in Maryland's Sixth District (Cumberland and Hagerstown), don't. Vote Republican - for incumbent Repv. Roscoe Bartlett, who shows more awareness for Peak Oil than anyone else in Washington.

These are all problems that we need to deal with. Note that I don't list terrorism. I believe this is a subproblem to Prevalence of Mainline Religions. Religions drive people to commit acts of terrorism, for example, to go to where there are 55 virgins. It is a red herring. Terrorism is not the problem. Global Warming is a serious problem but it is not The problem either. The Problem is Peak Oil. Focus our attention on that, and the other problems probably will work themselves out.

Interstate System Turns 50

2006-06-28T17:32:00.000-07:00

As part of my membership in the American Automobile Association (not AAA - that's an honor student's report card), I get the magazine AAA World. The big picture on the front cover is an Interstate highway sign saying "50": The Interstate Turns 50. After some hunting around for it because the front page of the contents looked more like a blary ad than like a table of contents, I found it on page 62. On 2006 August 13, the Interstate System will be 50 years old. Interesting. It started on my 10th birthday, so on that date I will be 60 years old. 10 + 50 = 60, and the Interstate System has been an integral part of my life, as it has for everyone around me.

The article contains some interesting information on the Interstate highway system, including its history. It seems that Dwight Eisenhower started it by going on a tour of the United States in 1919 to document all the places in our country that it was hard or impossible to get to by automobile as justification for his plan to build a network of superhighways in our country. Later on, when this adventurer was President of the United States, on 1956 August 13, Congress passed and Eisenhower signed into law the Federal Highway Act of 1956. It mandated the construction of a network of superhighways across the nation. These highways would have no stop signs, no intersections, no rail crossings, no highway traffic jams, and in fact nothing to impede auto traffic. When you get on one, you just simply go and go and go forever into the distance. This made distant places a lot easier to go to and changed drastically our lifestyle in this country. In fact, it has been called not only an economic force, but a democratizing force as well.

Some of the early cartoons presented in the article are interesting. For example, one has the treasury secretary put a stethoscope to the highways of our nation; in his other hand is a doctor's satchel. Another one has a series of letters to Congressmen soaring in to the air to the nation's Capitol, with cars driving on it as though the letters were a superhighway. The cartoon was urging us to prevail on our leaders to construct such a highway system. The system is just about complete now, and in many places it looks like something unearthly or extraterrestrial, with all these highways crisscrossing all over the place. Take a look at Rochester, New York's Can of Worms, Richmond, Virginia's James River Bridge, Bryan Park area, or I-895 bridge, or Washington, DC's Springfield Mixing Bowl, and you see what I mean.

But has it all been good? Think of all the land that was used up in constructing the Mixing Bowl. It must be a square mile or more. And they are still making it bigger and bigger. The highways have encouraged us to drive cars all over the place and to go out farther and farther into the suburbs, engaging in what Jim Kunstler ("Clusterfuck Nation Chronicles") calls "an idea with no future". This network of highways makes us dependent on the automobile, and it does not do all what it was intended to do. It avoids city traffic jams, which are annoying, all right, but it causes superhighway traffic jams, which are colossal and waste huge amounts of our citizens' time and fuel. Further, the fuel which drives all of this Interstate is about to run out. The world is nearing "peak oil", after which production will decrease from year to year, causing shortages all over the place. This could lay waste to this entire assemblage of concrete ribbons. Maybe the superhighway system is the Great Moai Statue of our society, like the statues that Easter Islanders built before they ran their remote island out of trees and their way of life.

The AAA article says nothing about this ominous future of our interstate system, and further, they have the gall to praise, in a subarticle entitled "A Recipe for Success", Colonel Sanders and his Kentucky Fried Chicken enterprise. That's right, AAA. With these highways comes Kentucky Fried Cruelty and We Do Chickens Wrong, not to mention trans fat as well.

The Interstate System of highways is a great achievement of humankind. From out of dust and dirt arises an intricate and complex network of concrete ribbons throughout our nation. I say we should use what's coming up, the system's 50th birthday, to say "Mission Accomplished" and not build any more Interstate highways. Instead, let the rising cost of gasoline take traffic jams off the highways.

Economic Collapse and Bubble Boom, Part 2

2006-06-06T20:50:00.000-07:00

I received both books today, The Coming Economic Collapse by Stephen Leeb, and The Great Bubble Boom, by Harry S. Dent. I haven't read all of these volumes, but I have read enough to come with some conclusions. I believe Leeb more than I do Dent.

Stephen Leeb believes that peak oil will profoundly affect our society. He shows this more than in his earlier book The Oil Factor, and in some cases suggests we could be nearing an end to our civilization, although he says this need not happen if we take the right actions. Like other peak oil people, he says that oil prices will continue to rise for the foreseeable future. This happened before, in the 1970s, and he uses that decade as a model for what is coming up in the next few years - the Double Zeroes and the Teens. During that time, inflation threatened to get out of hand. It was stopped by Fed chairman Paul Voelker raising interest rates so high that they suppressed inflation, and eventually caused things to come back to low inflation. Mr. Leeb notes this can't happen this time because of huge consumer debt. If Bernacke were to try that, housing buyers would disappear, people would not be able to pay their adjustable rate mortgages, and house prices would plummet, taking stocks and the economy with it. So the only thing left is to let inflation rage. This implies that we could be heading towards million-dollar homes, then million-dollar cars, then million-dollar computers and so forth, and I hope we aren't heading towards 1923 Germany.

Leeb says that wind holds the most promise to replacing oil in our society; he doesn't mention the idea of converting coal to gasoline, as in his earlier book, I guess because he says that wind can be used to electrolyze water into hydrogen for fuel for fuel-cell vehicles. Among the investments that should be shunned are those that did poorly in the 1970s: cash, bonds, stocks, and small-cap stocks (although the latter did well in the 1970s). Instead, he says we should invest in oil, gold, real estate, China, India, and alternative energy. It is hard to follow such a strategy now because it seems that oil and gold have a tendency to drop in price as of late. But he says we should invest in these things.

Harry Dent did not do as well with his Bubble Boom. He uses generational theory and the upcoming Fourth Turning for his predictions. He says that a booming market, to the extent of Dow 40,000, will come in the next few years, by 2010. Then he says the Mother of all Depressions will occur, because the Baby Boom generation will start retiring and require support. He even describes a mini-history of 2010-2024 and beyond. I read through this and it seems like a repeat of the Great Depression and World War II. He even calls for the election of an FDR-like president in 2012. If he is talking about a Crisis President, I think this president is more likely to show in 2008, and I made a claim on Beyond Opinion that this president could be Al Gore. He does present a graph in which there is an uncanny resemblance in the Dow of 1921+ and the Dow of 2002+, but many other authors have found such similarities, and they haven't panned out. The truth is that no two Fourth Turnings are the same. The one before the Great Depression and World War II was completely unlike those crises. Instead of dragging on for 16 years or so, this one, the Civil War, was over in only 4 years, and it did not involve much economic dislocation, at least for the North. Dent makes the same mistake as President Bush - overemphasizing terrorism and ignoring peak oil. Neither Leeb nor Dent mention global warming.

Harry Dent seems to completely ignore peak oil, and assumes we are going to have an adequate supply, and gives brief mention to the Athabasca tar sands in Canada, although that oil takes a lot of energy to get from the tar. He devotes an introduction to peak oil, and he suggests that prices are going back to under $40 a barrel and that oil and oil stocks are about to tumble. I don't think so. The problem is not some trick or some technicality in a figment of the imagination such as a stock's price, but is a genuine supply problem with the stuff. His reading is fascinating in places, however, and he demonstrates well the concept of the S-curve, which is also called the logistic curve. Dent applies this curve to automobiles, computers, and cellular phones. He says that we are 90% into the Internet S-Curve. I think he should apply his S-curve concept to cumulative oil production. He will find that we are near the 50% mark on that curve; i.e., nearing peak production. His recommendations are for stocks of all kinds until 2010, and then invest in money market funds and the like. Leeb says those investments will lose purchasing power to inflation.

I asked both of these men about the theory of the other. Leeb does say in his book that retirement of baby boomers (a prediction of the Fourth Turning) will drag the economy, but that peak oil is the more serious problem. A spokesman of his said that baby boomers will continue to find work into their later years and so that will not be a problem, unless peak oil makes it one. However, as we have seen, Dent does not mention peak oil at all, and actually says that oil prices are a bubble and are about to tumble.

Which am I to believe more? I'd go along with Leeb. The Fourth Turning is an interesting concept, but still merely an abstract concept, but oil is a real substance. Either way, we could be in for some hard times, and I believe that the Fourth Turning crisis will center on finding how to continue civilization without fossil fuels.

0=1, Blogger?

2006-06-06T20:14:00.000-07:00

Two days ago I posted a blog about two books about the future, written by H.S. Dent and by Stephen Leeb. I got a comment on it today and OK'd it for this blog. After I did that, Blogger continued to say that the blog had no comments. But when I clicked on "0 Comments", I got a comment! The one the commenter had submitted. Blogger, 0 comments is not 1 comment. Either there is a comment there or there isn't. It can't be both. The worst part about it is that I have to go all around my blogs clicking on notifications that say "0 comments" because some may have comments. Blogger needs some truth-in-commenter-counting audits.

Bubble Boom and Economic Collapse

2006-06-04T20:43:00.000-07:00

Peak oil is coming. Some say as early as 2005 December 16, which has come and gone, and others as late as 2037. To me it looks like it's coming in 2008. Our present steady oil market will be replaced by a declining one, and shortages, high prices, and possibly wars will occur. Further, baby boomers like me (I will be 60 years old soon) will start retiring in droves around 2010; they will live on retirement incomes and drag the economy down. Grim outlook. How should I invest? I have run into two financial analysts who take societal trends into account: Stephen Leeb, who takes peak oil into account, and H.S. Dent, who takes generational theory into account. Up to now, Stephen Leeb (The Oil Factor) calls for alternating mostly safe investments (if oil increases 80%) with investing in energy, gold, and real estate (bubble busting soon?) (if oil decreases or increases less than 20%). H.S. Dent (The Roaring 2000s) says that incredible boom times have come (yeah, the dot-com boom and bust) and that we are going to get more big boom, until 2010 when the Mother of all Depressions with 15% unemployment will arrive and last 15 years.

What do they call for now? Stephen Leeb has published a new book, The Coming Economic Collapse, in which he says that peak oil will cause the world economy to go into a severe recession or depression, but he says one can still "get rich" from it. I don't see how. H.S. Dent has published The Next Great Bubble Boom, in which he says an incredible boom will occur until 2009, with the Dow hitting 40,000 (that's right - forty thousand) and then the roofs are coming to be coming down everywhere like roofs on houses in New Orleans during Katrina: The Mother of All Depressions. I have ordered both books.

I will read them when I get them this week, and will find out what they say. In the meantime, I will say that investing in near peak oil times has proved to be tricky. Oil does not go monolithically up. Instead, it soars in price, causing people to grouse, grumble and do without. This causes demand to decrease ("demand destruction"), causing oil to fall in price. In addition, the higher gasoline and other fuel prices cause a slowdown in the economy and higher inflation rates, and these things cause the stock market to fall, taking energy funds and gold with it. So for example, my energy and gold shares have done great so far this year, until recently when they fell, costing me 1% of my portfolio. Stephen Leeb reminds us that we should not buy and hold, but at no time did his negative oil indicator sound. In fact, his positive indicator has hit several times. So I have held. But I do know one thing. If the weather models predict a major hurricane hit on the Gulf Coast, I am pulling out of stocks altogether.

Maryland Sixth

2006-04-28T19:55:00.000-07:00

To me the most interesting US House of Representatives race of the year will be that in Maryland's Sixth District. I used to work and go to church in this district. Back in the 1970s I worked at Ft Richie, near Hagerstown and near the Pennsylvania border, and went to church in Hagerstown. The district includes Hagerstown and sprawls all the way westward to the border with West Virginia. It is the most conservative of Maryland's congressional districts and only one of 2 out of 8 whose representative is Republican.

The current Representative is 80-year-old Roscoe Bartlett, who is well-known in peak oil circles as the only US Senator or Representative that knows aobut the peak oil situation coming up and is willing to talk about it, to the extent of having conferences about it. For this reason, if I were living in Maryland Sixth, I would vote for Roscoe Bartlett, even though he was Republican and despite some of the stands that he has taken.

But I wanted to see what the Democrats would say. So far, the Democrats have been puny about Peak Oil. They criticize the Republicans, especially President Bush, for the high gasoline prices we have been having, even though those are the result of supply and demand. But they don't come up with substantive proposals for dealing with the problem. I found out that there are two Democratic possible challengers to Repr. Bartlett: Barry Kissin and Andrew Duck. So I tried seeing what these two people would say about Peak Oil.

I looked at Andrew Duck first. He wants to bring the price of oil back to $30! His site recommends this portfolio of actions: Conservation, Increasing the fuel mileage targets for vehicles, Research and infrastructure support for biofuels, Clean coal gasification [sic], Increased support for wind power, and Increased use of natural gas. This sounds a lot what I would recommend: a full court press. I would add plugin hybrid cars to the lis and railroads to the list. How come people in government won't recommend a return to the railroads? But his wanting to bring back oil to an unrealistic level and his not mentioning peak oil at all had me favoring Roscoe Bartlett for election.

I emailed Duck about the 30% and he surprised me with his reply. It turns out that Roscoe Bartlett may not be all the peak oil champion that the peak oil people make him out to be. According to Duck, Roscoe Bartlett voted no on Tokyo accords, no on increased CAFE standards, and at first no, then yes, to drilling in the Arctic National Wildlife Refuge. Duck says he votes the Bush and Republican line repeatedly. This makes me wonder about Roscoe, since outside of peak oil, his stands are quite dissimilar to mine, because they are all Republican stands. However, Duck does not mention Peak Oil either.

I looked up Barry Kissin and found his site more interesting. He gives a long dissertation on how Roscoe Bartlett is not what he is cracked up to be. Mr. Kissin actually talks about Peak Oil, whereas Andrew Duck does not. I found Mr. Kissin's paper to be interesting, and it makes me wonder which candidate would indeed be the best from Maryland's Sixth. It makes me wish I were in Maryland, so I could make such an important peak oil vote. However, even he does not call for what I think is really needed: a $1-10/gallon fuel (including diesel and gasoline) tax and compensating reductions in other taxes, especially income taxes.

So if I were in Maryland, I would contact all three candidates and point out the flaws in their positions, and see how they react. This would determine who I would favor to go to Washington representing Maryland's Sixth.

Note my abbreviation for Representative: Repr. I use that instead of Rep., because Rep. is ambiguous and could mean Republican.

Computer Call about the Oil Companies

2006-04-26T17:40:00.000-07:00

I received a call from Harris Miller's campaign for US Senator from Virginia at 2006 April 26 19:38. It came on my Caller ID as “Unavailable”, and was a computer call urging me to vote for Miller and help us beat George Allen. I wish these campaigns would not send out computer phone calls? I don’t appreciate them. They bittering my phone and disturb what I am doing. Normally, this would mean the candidate would not get my vote. But there is no way I will vote for George Allen - the worst governor Virginia has had since 1978. I don't like the idea of voting for a third party either - I feel that Sen. Allen must be removed from office. Especially I don’t want George Allen to repeat his term as senator and thereby become a possible Presidential candidate in 2008. But there are ways of sending him back to his home without throwing unsolicited computer calls on my telephone.

I also did not like some of what I heard the message say. The Miller camp said “Stand up to Big Oil.” Now Big Oil is no saint. But attacking oil companies because of record high profits and high gasoline prices is not the right approach to the problem. The oil companies can’t help it if they have all that money. It is because of supply and demand – increasing demand (especially because of China and India) and limited and tight supply are causing the prices to go up and the profits of the oil companies to go up. The problem is that the world is nearing a peak in oil production, and soon world production will decline despite all the desperate drilling in the world. Instead of attacking the oil companies, the Democrats should encourage conservation of oil – car pools, hybrid, diesel, and plugin hybrid cars, and railroads – and development of wind, solar, and (at least for a while) nuclear energy, as well as high taxes on fuel to curb demand, along with substantially lower income and other taxes. This is a problem that confronts all of us, including the oil companies, and I feel that an approach urging these things as well as cooperating with the oil companies and others concerned with this problem will yield better results in the long run.

I also would like to see talk about peak oil and its consequences. So far I have not heard a single Democrat say that the world is headed for trouble because of the peaking of oil production. However, at least one Republican has, namely Repv. Roscoe Bartlett of Maryland. If he were running instead of George Allen here in Virginia, I would vote for him, and if Mr. Bartlett runs for President, he has my vote, even though he will be 82 years old.

So please, Mr. Miller, if you want to be serious about beating both the oil crisis and George Allen, start talking to us about the possible consequences of big oil.

And when you call, have a human call. OK? Thanks.

Oil Price Correction?

2006-04-19T18:27:00.002-07:00

I am now hearing reports that oil's price will drop 20% this year to something like $55 a barrel. I find this in http://www.cbc.ca/cp/business/060419/b041964.html, but don't go there after a few days; you probably will get "not found". Instead I quote some of it here:

The recent runup in commodity prices is due to speculative activity that sets the stage for crude-oil and base-metal prices to drop by 20 per cent by year-end, a TD Economics report (TSX:TD) warned Wednesday.

This comes from CBC, the Canadian network. The article says that a correction in both energy and "base metals" (including gold) will occur sometime this year.

Do these people know that peak oil is coming?

Now I do think that retractions in oil and gold prices do occur. A major correction occurred last year when Hurricane Katrina hit, taking refineries off line and preventing crude from being refined, decreasing its value. I lost thousands (which I have gotten back this year) during this time. Most of these are small contractions and they are followed by big increases, which are happening now.

This is because oil may be nearing the peak where no matter how hard the suppliers pump and pump, they still can't meet world demand. The world market is tight as a snare drum, and any disturbance in it causes immediate reactions. Oil and gasoline will continue to increase in price in the next few years as demand rises, and supply stays the same for a while, then declines.

I am not sure I want to keep shuffling money in and out of energy shares every time Ahmadinejad goes nucleuckoo in Iran or hurricanes smash rigs and refineries in the Gulf of Mexico. The long term trend is up, then up, then way up. I am just hoping supply and demand will help us find alternatives before some really drastic things happen. It's going to be nip and tuck. (that's why I call this blog Cliffhanger). But a change once or twice a year might be advisable.

So what do I predict? I think oil and gold will keep rising through the middle of the summer, to $3.10/gal and $75 a barrel by the end of April, $3.30/gal and $85 a barrel by the end of May, and up to a peak of $3.45/gallon and $95/barrel by the middle of summer. It then will decline to about $2.40/gallon in December and maybe $75 a barrel, and then rise again in 2007, to even greater heights. If a hurricane strikes in the Gulf, oil will hit $90/barrel and then decline moderately, maybe to $65 a barrel by October, while gasoline will hit $4.70/gallon and there may be shortages.

So what to do about stocks and other investments? I say hold on to those energy and gold shares, because they are not ready for a correction. They will continue to head upward for a while. Sooner or later, probably late summer, the US and world economies will be hit by these prices and a downturn will occur. This has not happened yet. People are still driving all over the place as before. When the downturn occurs, oil and gold prices will go down. So if there are strong signals that this is happening, pull out of oil and gold shares. In fact, pull out of all stocks and put everything in money market funds. When oil and gasoline start rising again, then put the money back into oil and gold. If a hurricane threatens the Gulf, pull everything out, including oil, gold, tech, medical, and everything else, immediately. Being able to access weather models such as the Global Forecasting System (GFS) can help you decide this will occur before the media starts harping all over the place about it, so you can pull out and retain all of your gains.

But even if you pull back, eventually get back into oil and gold, for the money of the future is in these, with oil in ever increasingly scarce supply.

That's Right, Blame the Oil Companies Again

2006-04-18T19:39:00.000-07:00

The price of oil and gasoline is going steadily up again, as I had expected. Earlier, I predicted that some time this summer, the price of oil would peak at about $95 a barrel and the price of gasoline at about $3.40. This is because we are somewhere near peak oil production, although it is hard to tell just how near, due to the damage by Hurricane Katrian. In general, prices are going to go up, because demand is up and supply is either going up slightly or staying steady. The only way to get them down is through lower demand.

Nevertheless, people are blaming the oil companies again. New York Senator Charles Schumer is calling for an investigation to see whether oil companies are deliberately holding back production to raise prices. He says they are running at 85% capacity, when they should be running at 90%. Apparently he does not know or does not want to admit that there is a supply problem with oil that is driving up the prices.

If the oil companies are running at 85% when they could be running at 90%, they are really doing us a favor. They are using less oil. That will delay the day that shortages and other undesirable effects come because of the dwindling supply of cheap oil. Why does Sen. Schumer want us to go full tilt with the oil production? Why does he want to gobble up the stuff faster and run out faster?

Prices are going up because supply can't meet demand or can just barely meet demand. Now that may bring in huge profits to the oil companies. If so, they should use the money to sponsor looking for new sources of energy or for conservation. Paying their executives hundreds of millions of dollars per year certainly is not going to help their reputation. But the oil companies can’t be blamed for gouging the public, regardless of what it does for their profits.

Stop blaming the oil companies and do something that will help. If prices are higher, curtail consumption, and encourage development of renewable energy.

Kurzweil's Singularity

2006-03-26T16:48:00.000-08:00

I ran into a book by Ray Kurzweil (a name which reminds me of synthesizers) called The Singularity is Near. In this book he states that major events in the Universe are happening faster and faster and at some time in the future, an infinite number of events will occur just before a certain time which he calls the singularity. These events could start with the creation of the universe 13.7 billion years ago. Kurzweil then follows that with formation of the Earth and Sun, formation of life, Cambrian explosion, and so forth until he concludes with the Industrial Revolution, the car and airplane, the television, the computer and the Internet. Each of these events come sooner by a certain factor than the previous. If this factor is constant, it follows that these events converge to a point in the future, the singularity, which Kurzweil calculates will be somewhere around 2045. Kurzweil continues to describe events beyond this; in fact, two of his six stages of existence follow the singularity.

Is there any such thing coming up? Certainly an infinite number of events can't occur in a finite time. As this singularity is reached, the process breaks down. So what's going to happen? I tried to see if there were any singularities in my life. I found at least two of them, and possibly others. Both of these two singularities had catastrophic results. This says that singularities are not necessarily positive. Indeed, what could be happening is a conversion to a time when we run out of oil, have huge global warming effects, have a number of wars going on, and so forth. The consequences for humankind of this kind of singularity are huge; maybe our world civilization will collapse.

What will things be like if a singularity like the one Kurzweil occurs? In both of my singularities, I wound up in a world or existence substantially different from what went on before. It was like entering a new world. So that is how I expect this singularity will behave. Something earthshaking will occur then, and a new world order will ensue. In 2045. Well, we will have to see if this happens.

We Were Warned, or Were We?

2006-03-18T20:29:00.000-08:00

I saw "We Were Warned: Tomorrow's Oil Crisis" on CNN at 2006 March 18 2000 EST (8 pm) and was disappointed by the documentary for several reasons:

1. The ads did not go with the documentary. One of them was a Lexus ad for this fancy schmancy car that advertised all that's great about it except fuel economy. Another one was about how cool it was to have a cell phone that wasn't a cell phone because it was a video game with cell phone capability.

2. An executive from Exxon-Mobil said we had 100 years (or was it billion barrels) of oil left in this country if they could dig for it. What I know is I think of this Hubbert curve for our country peaking in 1970s after a discovery peak in the 1930s, and then I think of world production peaking in the 1960s and drawing the curve from there, except that the executive wants to push out the right side of the curve as though it were Pinocchio's nose.

3. The main problem I found with this documentary was that it used an unlikely double disaster scenario as its base point for discussion. I think it would have been better if it had shown absolutely no Katrinas, Ritas, al-Qaedas, bin Ladens, planeattacks or any other such deviations from business as normal and still shown that the effects of the crisis would still occur: high oil prices, empty Wal-marts, no tourism, people fighting with each otehr, and plunging stock markets.

4. I do note that that point that another poster made about the ethanol from sugar cane solution working only in Brazil showed up absolutely nowhere in the documentary.

5. I also note that for the hurricane on Houston they used footage from Rita, and for the disaster in Saudi Arabia, I think they used footage from Persian Gulf War I.

A better documentary is "The End of Suburbia". I have heard of a 90-minute documentary called "Oil Crash" but have absolutely no idea as to how to see it. In the meantime, CNN needs to try again with its documentary on peak oil and come up with something that is more likely.

Telescopes Will be Better in 2050

2006-03-15T12:29:00.002-08:00

At the latest meeting of the Richmond Astronomical Society, someone brought up an article in the BBC on the Internet that said that telescopes will be worthless by 2050. The article maintains that global warming, which increases cloudiness, and jet contrails will combine to form a haze that ground telescopes will not be able to penetrate.

Global warming is a serious problem. However, I think that telescopes will be better in 2050. This is because of peak oil. Professor Gerry Gilmore of Cambridge's Institute of Astronomy maintains that air traffic will increase, increasing the number of jet contrails, which produce artificial cirrostratus clouds that obscure the sky. He says, "You get these contrails from the jets. The rate at which they're expanding in terms of their fractional cover of the stratosphere is so large that if predictions are right, in 40 years it won't be worth having telescopes on Earth anymore - it's that soon."

No, Professor Gilmore. You did not take Peak Oil into consideration. There may not be any jet planes flying in 2050 to make contrails with. These planes require fuel, and you assume that jet travel is just simply goinjg to increase without limit. Instead, oil production will peak, probably between 2008 and 2010, and decline from that point on. By 2040, only a fraction of today's oil will be produced. From this must come the fuel for jet aircraft. It follows that far fewer aircraft will be flying, unless some way can be found of powering aircraft other than with petroleum products. So actually, the contrail situation will be better.

Global warming will wane, also. It is fueled by fossil fuels, and these will decline after 2010, and so will global warming. There may be some temporary increase due to coal, but if clean, renewable alternative fuels are developed, these will dominate in 2050, meaning a sharp decrease in CO₂ emission. Further, energy prices are sure to rise dramatically, due to peak oil, and so people will invent new means of conserving electricity, and hence generation of power from power plants. These may include such things as a device that will turn out lights unless people are in the room. If these proliferates, the cities will turn dark at night, and the stars will come out.

All of this means much better viewing in 2050 than now. Don't move or take apart Lick, Wilson, or Palomar Observatories! These telescopes will be much more useful functioning under beautifully starry skies in the year 2050. That is, unless peak oil and an energy crunch prevents power for clock drives and equipment from coming into the observatories.

This blog also appears in Here and Above.

Chain Reactions

2006-03-08T20:12:00.000-08:00

I am a member of a church supper group. Dinners are scheduled once a month, in which a bunch of couples come to this one couple's house who hosts them and prepares a dinner for them. This allows us to get to know each other better. I thought of what happens if not enough couples are assigned to the dinners. If only 4 couples are assigned at a time, then if one or two can't make it (this can easily happen), then the hosts have to reschedule the dinner so that they all can make it. So there would be a large number of reschedulings; these would conflict with other dinners, church, and other events and cause more reschedulings. This reminds me of something I saw back in the 1950s in shows, perhaps on Walt Disney's Tomorrowland, of a demonstration of a nuclear fission chain reaction.

In such a chain reaction, a neutron hits an atom of Uranium 235 or Plutonium 239. This causes the atom to split, ejecting energy according to E=mc², two smaller atoms such as those of barium and krypton, and one to three more neutrons. These in turn would hit other atoms, which in turn would break up into two smaller atoms and produce more neutrons. The number of free neutrons grows exponentially until the entire chunk of uranium or plutonium is consumed. The resulting energy is tremendous, and produces the familiar mushroom cloud of a nuclear explosion.

In the 1950s they demonstrated the concept by covering an empty room's floor with mousetraps with ping pong balls on them. Then someone would throw a ping pong ball into the room. The result is dramatic. Almost instantly, the air would be filled with balls pinging and ponging all over the place. This demonstrates the concept well, but I realized that this experiment can be used to model other things as well, after seeing a Java applet from my alma mater that demonstrated this concept at http://ccl.northwestern.edu/netlogo/models/Mousetraps .

For example, Peak Oil. If you clicked on the mousetrap URL and ran the Java app, notice the graph on the bottom, measuring the number of balls in the air. Now compare this with the curve that is used to demonstrate the concept of Peak Oil. Don't they look similar? It's because similar concepts are involved.

Oil was discovered in 1859. At first, only a handful of Pennsylvanians used the oil. But these people talked to others about this wondrous substance, and other people started to dig for oil. These in turn did wondrous things with the oil, such as invent and operate automobiles and aircraft, and this led others to want the oil. This kept spreading all over the world, resulting in a growth in the use of oil that resembles the up side of the Peak Oil bell curve. However, as people began spreading around drilling for the oil, less and less oil was available to find and drill for. This puts a damping effect on the growth of oil production, until eventually the damping will exceed the growth and turn it into an exponential descent or decay. The same thing happens with mousetraps or uranium, as the chain reaction runs out of mousetraps to spring or uranium atoms to fiss.

In both cases, the determining differential equation is the same: y' = Ay(C - y) . C is the total capacity of the system, and A is the rate at which neutrons or ping pong balls are generated per neutron or ball strike. Solving the equation and graphing the solution results in a bell-like curve called the logistic curve.

The equation can be used to describe other behavior as well. Take people living in a city around 1900. They live in decent neighborhoods. But some get dissatisfied and move out farther from the city so they can have more room. These people are like ping pong balls that get ponged and hop out to land on another mousetrap. This causes more people to move out. This accelerates as the once livable neighborhood deteriorates in the inner city. Eventually the suburbs get crowded and people move out even farther from the city. This causes the inner suburbs to deteriorate as well. Look at the Java applet again. Doesn't that red blob remind you of a typical city with development going on? It's fueled by oil, of course.

The equation can be used to describe bacteria in a Petri dish, viruses in the body of a large animal, the growth of the Internet, the growth of automobiles, and in fact, the growth and decline of just about any product or fad. It's an equation we need to live with. We live in a world that moves on in logistic curves, and Peak Oil happens to be one of these curves.

World Civilization Nearly Bought the Farm Today

2006-02-24T20:44:00.001-08:00

Turn on the news. What did you hear today? The big story was the destruction of a mosque in Iraq and the reaction that it caused among Shiite Muslims in Iraq. Right now, CNN is highlighting the low-key Mardi Gras that New Orleans after Katrina will celebrate next week. It's not even Mardi Gras yet. A port deal was approved giving operation of 6 US ports to a Dubai company, and legislators are griping about it. ABC has up front the story of some prima donna having breast cancer. The local news is all in arms about the euthanizing of two black bears at a local zoo because one bit a boy; this after we found out about how Chesterfield's supervisors and other officials have been flying extravagantly (or vainly, to use Carly Simon's term) all over the place at taxpayer expense. Some of this is relatively important. It seems the lives of prima donnas and murder cases of lily white young females dominates the news.

All miss the big one. Our civilization almost bought the farm today. Some suicide bombers came into Abqaiq terminal and blew themselves up. They only blew up some minor stuff. If they had blown up the pipeline from Mideast oil to the Persian Gulf, a huge amount of oil would have been taken off the market. This would have caused skyrocketing oil and petrol costs all over the place and would have caused massive shortages as well. Much economic trade would have ground to a halt amidst the $300 a gallon oil and $9.50 petrol. Look at EV World and you will see what I mean.

It's time the hypermedia quit with the murders, the divas and other Hollywood personalities, and the continual harping on tragedies that have already happened such as Katrina. They need to focus more on peak oil, and to throw these other things aside and give stories like today's Saudi attack top billing.

Two Dollars and Twenty-Fix Cents a Gallon

2006-01-21T16:39:00.000-08:00

What's the price at East Coast? Two dollars and twenty-fix cents a gallon, that's what. What's a fix? It looks like it is part 5, part 6, and doesn't know what it means or which it is. Maybe it is $2.25 1/2 a gallon or $2.255 a gallon, or considering that they always put a 9/10 of a gallon on the big price, maybe it's $2.264 a gallon. Maybe it is some new number or mathematical concept that looks like some digit, like the symbol for infinity looks like an 8 on its side. Of course it can't be infinity, although it is trying to reach that impossible level.

Apparently it is a malfunction of a bipartite sign in which the bottom and top halves of the digits are operated separately. If so, what other new digits can we come up with? A woo (top looks like a 1, the bottom like a 2) looks like a question mark? without the dot. A throur (between 3 and 4) looks like Captain Hook's bad hand. A seight (between 7 and 8) looks like a bird riding on a unicycle. And so forth.

But can these newfangled digits really measure what's coming up with oil? It may be nearing a peak, in which case we can expect those price signs to continue to go up frantically, like a bouncing Wal-Mart happy (or maybe sad) face hitting a price sign and causing the price to go up instead of down. Indeed, I wonder where we will get the energy and the oil we need in the future after we reach the peak. Maybe if that happens, the crazy digit in the price will mean exactly what means: we will all be in a fix.

Cliffhanger Developments for 2006

2006-01-02T19:05:00.000-08:00

Well now, 2005 has come and gone, and along with it the Deffeyes Thanksgiving of 2005 November 24, supposedly the date that Peak Oil occurs. It has been an eventful year all right. Both petrol and oil went up in price dramatically, raising the price of oil to about $66 a barrel and the price of petrol to $2.54 near where I live. The hurricanes then came, possibly sent to us by Peak Oil's brother, Global Warming. That destroyed so much in the Gulf of Mexico that the price of petrol went all the way to $3.25 on average near where I live, and at some stations hit $3.49 a gallon. Then they went down rapidly, down to $1.95 a gallon, because refineries came back on line, oil from the Strategic Petroleum Reserve arrived, and so did oil, petrol, and natural gas from Europe. I expected this because of the rebound effect. Petrol prices should now go up, and I have observed this, as they are now about $2.15 a gallon. The price of crude oil actually went down when the hurricanes struck, because with fewer refineries operating, there is less demand for crude oil. It is now going back up, around $61 a barrel. The world is operating without any slack, producing and consuming 82 million barrels of oil each day.

So what's ahead for 2006? I think prices are going to go up. Oil will probably hit about $95 a barrel, just short of the century mark. Petrol around here will be $3.50 a gallon in the summer. Prices should then edge back again, provided a new batch of hurricanes don't cause trouble in the Gulf.

I do not think oil has peaked yet, but it could soon. Some people are saying the peak will not come until 2020 to 2025, and they may be counting oil from a number of unconventional sources, including deep ocean, Canadian tar sands, liquefied coal, and oil shale. These take a substantial part of a barrel of energy to produce one barrel, hardly efficient. I think the progress to the peak will be slow, and the ill effects that James Kunstler predicts in his Clusterfuck Nation Chronicles for 2006 may eventually come up in future years. For example, I hardly think that the Dow will go to 4000. I think it will end the year around 10,700, about where it is now. If you want your money to earn money, try energy stocks and funds, gold, gold stocks and funds, and money market funds. Inflation should be coming up, but I don't see that happening. I find it interesting that Kunstler thinks that China is going to go cuckoo and that South America is going to go loco. In other words, the whole world is going to go bananas soon. Further, he thinks that China will wag the dog and attack a central Asian nation to divert attention from domestic troubles caused by a worsening fuel situation. I don't see any evidence that will happen any time soon.

There are some ominous developments, hwoever. The price of oil is going back up again. Russia is denying Ukraine gas because Ukraine will not pay $230 per 1000 cubic meters of gas. This price corresponds roughly to a monthly bill here for gas of about $1,400. Pretty high. Ukraine has enough to last 6 months. Its pipelines also feed western Europe, so the result could be a skirmish between western Europe and Russia. Even worse yet, Euripe could cut gas to the United States, causing serious problems here. There could be cold snaps here this winter. And as Kunstler points out, the price of gas goes up when the weather is colder than normal and down when it is warmer.

So what's going to happen in the future? As I said before, this one may go down to the wire. It's a cliffhanger. Supply and demand is pretty powerful and will push alternative energy sources into the marketplace as the cost of fossil fuels go up. Whether this will be enough to cause a catastrophic shortage remains to be seen. Conversion to the new sources will cause a series of crises in future years, and the outcome of these will determine what kind of future our world will have.

Note that I use the word "petrol" to describe fuel for motor vehicles, rather than gasoline or benzine. Gasoline is confusing because it shortens to "gas", which also means methane from the ground. Benzine can be confused with benzene, the aromatic compound with ring molecules.

Conspiracy Theories

2005-12-26T18:10:00.000-08:00

I read with interest John Kunstler's weekly column today in his Clusterfuck Nation Chronicles. He addresses the numerous conspiracy theories that have emerged about the 9/11 Terrorist Attacks in the US. He does not mention any of them in particular, but he does mention the idea of the government letting it happen. He sees the conspiracy theories as a delusion that is distracting us from tackling the problems of Peak Oil directly.

Some of these say that the Bush government knew what was coming but let it happen to get an excuse to put troops all over the place near where the oil is. Others go further and say that the 2001 September 11 attacks were somehow choreographed by the US government. Is there anything to these? Kunstler says not.

I am not sure. Some of what these theories say can be disproven easily. For example, bombs did not bring down the World Trade Center. Every floor (below the plane hit lines) of the towers was in perfectly good shape until the floor above it collapsed on it. This is in line with the theory that high temperatures in the weight-bearing columns caused them to give way. It is not in line with the theory that bombs brought the Towers down. If that had happen, we would have seen explosions all over the place in the Towers. Further, some say a small plane with a bomb aboard hit the towers. A comparison of the outline of a Boeing 767 and the holes left by the terrorist planes seems to show that the two match each other.

However, questions remain. Why did World Trade Center 7 collapse? It was farther away from Towers 1 and 2 than other buildings that stood were. And why did every single building with the name World Trade Center was destroyed, but all other buildings stood? And how about the infamous eight "My Pet Goat" minutes between the time Bush knew about the attacks and the time he announced it to the elementary school class and the world?

I suspect these have answers somehow that don't involve what the conspiracy advocates are saying. But I can't rule out some kind of complicity. It was in the interest of the Administration to take control of large parts of the Middle East, since that is where much of the remaining oil is. So to me I could see where he would see the attacks as an opportunity to take this control. It probably did not happen that way, but it can't be ruled out.

In any case, weapons of mass destruction were not the reason why the US invaded Iraq. Neither is getting rid of a ruthless dictator. That was the good thing about the invasion. Saddam can no longer shred people. But helping the Iraqi people and setting up a democracy, although it may be a generous act by the US to that country, was not the reason why the US invaded. It invaded because of oil. That is not the way to deal with the upcoming crisis; cooperation with nations and companies is the way.

Kunstler also says that there is an elephant coming up the python and that sooner or later it will be here. I wonder if he is aware of the other elephant in the python - the retiring Baby Boomers. This huge group of people is all of a sudden going to consume instead of save. Could this cause the economy to crash?

Oil Shale and Energy

2005-12-26T09:46:00.000-08:00

This morning I read an article about the deposits of shale in the western states of Colorado, Utah, and Wyoming, centering around the triple-point at which the three states meet. The article said that there is a tremendous deposit of oil here. It said that there are a billion barrels of oil per square mile. I looked at the map and I could easily see two or three areas at least 30 miles wide. So this is a total of well over 2-3 trillion barrels of oil.

Then I read further to find out what this mining would be like. The idea is to take a rod and plunge it deep into the earth, and heat it to 700 degrees Fahrenheit. This melts the rock and after a while of doing this, the melted stuff, consisting in large measure of an oil-like substance, comes to the surface and it can then be refined into distillate products such as gasoline.

The problem with this is that it takes a tremendous amount of energy to heat the rock to 700 degrees. The article said this would have to be done for four years before any oil comes from it. Further, the column would have to be surrounded by a cold layer, I suppose, at least 100 degrees below zero. That would require more energy. And further, the operation requires a lot of water, which is not in great supply in Wyoming, Colorado, or Utah.

The question is whether it takes more than a barrel of oil's worth of energy to get a barrel of shale oil out of the ground. If it does, this will not be an energy source for us - in fact, it takes up energy instead and would make the problem worse. Already, a few hundred thousand barrels of oil were extracted from these fields in the 1980s, according to the article, and it did not earn any profit.

Oil shale is a possibility, but mainly if a new technology not requiring so much energy could be used to get the oil out.

This is indeed a cliffhanger

2005-09-28T17:02:00.000-07:00

I have been away for some time due to a family problem. While that was going on, like everyone else, I witnessed on TV and other media the damage and suffering caused by Hurricanes Katrina and Rita. I have never seen anything like the destruction of an entire city, as though it were nuked, and the struggles that went on afterwards. Now people are pointing fingers at each other and vowing it would not happen again. It seemed to have worked with Rita. Now the opposite pattern has appeared. Some people are going to ride out hurricanes rather than roast for hours on a traffic-clogged interstate at 100 degrees F and 1 mph.

My main concern with these storms is the damage that they cause to oil facilities. Several refineries are now offline, and much production of oil and natural gas has been disrupted. The question is whether there is enough capacity to handle all the demand now. Gasoline prices rose from $2.51 to $3.29 after Katrina, and there were some stations out of gasoline. Since then the prices have been receding. After Rita, prices jumped, then fell back, and are now rising again. I was afraid that real shortages will appear.

They may not. Now that the $3 barrier has been reached, demand is finally going down. People are driving less and they are carpooling and otherwise saving gasoline. This lowered demand, and that has caused prices to fall. It's the supply and demand equation working. When prices of a commodity rise, demand for it will decrease, and other alternatives will become profitable and will activate. It seems that supply and demand will take care of this peak oil problem.

However, oil and other hydrocarbons are non-renewable resources and there is only a finite amount of these substances. Sooner or later we are going to run out, and supply and demand may not take care of this sudden change easily. That is why I say this situation is a cliffhanger. It could go either way. Supply and demand and other energy sources are tending to ease the situation, but the continued demand overseas and finiteness of the resources are taking us the other way. It is not clear what's going to happen; it could be anywhere from a gradual changeover to other resources to a world catastrophe. That is why I think this situation is a cliffhanger, and why I have named this blog that.

I will, if I have a chance, post again this Monday; I chose this day for this blog because that's when James Kunstler's Clusterfuck Nation Chronicles comes out. If you follow this link, you may have to increment the number "15" to make the chronicle current.

Prius Really Does Have Good Gas Mileage

2005-08-01T20:35:00.000-07:00

It is now 2005 August 1. We are in the year of 18 projects, and apparently they are keeping the oil flowing in the world, although the market is so tight that a little hint of hurricane or a little flame at a refinery can send oil prices soaring towards the Space Shuttle. I heard today that Ford's average gasoline mileage is only about 19 mpg. This is averaged over all of Ford's vehicles. Evidently Ford can't get out of the SUV habit. One of these days it will bankrupt them. Toyota is much better, surely. They make gasoline-frugal cars such as the Corolla and the Matrix, and hybrids such as the Highlander and the Prius. But no, they are not the most gas-frugal brand of car. Honda is, at 25 mpg, and even that is not good in my opinion. Evidently Toyota has too many SUVs, too. They roar down TV news advertisements and car dealerships with a huge army of Tundra SUVs, ruining the good gasoline mileage they get from the Prius. Hopefully this will change soon.

But the Prius does indeed get good gasoline mileage. It gets nearly 50 mpg! This, plus conserving on when you drive, anyway, will help you through the high gasoline prices ahead of us. To show you what I mean, here is a record of our Prius, which we bought last Christmas Eve:

Date	Gallons	Price	Panel mpg	Actual mpg	Miles Driven
2005/06/12	8.088	16.98	49.1	49.0	396
2005/06/20	8.608	17.55	48.1	46.1	397
2005/06/29	8.424	18.27	48.8	48.9	412
2005/07/07	7.736	16.16	49.3	51.6	399
2005/07/16	8.584	19.65	48.3	43.0	369
2005/07/31	8.4	18.22	49.8	49.3	414

Pretty good, isn't it? The display on the Prius shows the number of miles since the last refueling and the mpg at that time. "Panel mpg" refers to this number on the display panel on the dashboard. "Actual mpg" is obtained by subtracting the mileage from the past refueling mileage, and dividing by the number of gallons. There is a bit of bouncing around, caused by uneven places at which gasoline pumps cut off. But the trend is clear. This vehicle averages at least in the high forties, and many times it comes close to or exceeds 50 mpg. Even with today's high prices, it still costs only $18 to fill the tank.

This is the car of the future. Either auto makers must make hybrids like this one or fail. Toyota is destined to be the top automaker in the United States, and in the entire world, by far.

Global Warming Special

2005-07-05T16:11:00.000-07:00

On CNN last Saturday night, I watched a special on global warming on CNN. According to the special, the effects of global warming are being felt right now. In Tuvalu, the water is rising, and even strong ordinary waves will flood houses and lawns. There is fear that this atoll, just above the water, will get submerged in the years ahead, and then where with the Tuvaluns go?

The ice is melting in the Arctic. The Inuit depend on it for their activities. The polar bear feed on seals during the winter, when the water is frozen solid. The frozen part of the year is getting shorter every year, and now there is fear that polar bears, which don't eat much at all during the summer, will become extinct.

The city of New Orleans is especially subject to damage by global warming. Over the past few decades, much marshland in the Mississippi delta went under water.

And so on it goes. Every coastal city, including 13 of the 17 largest, is subject to damage by global warming.

Or are they? How much energy does it take to melt all that Arctic and Antarctic ice? Is there enough energy in the oil and natural gas still remaining to do all this damage? A recent study suggested not. The Club of Rome report in the 1970s suggested in their basic computer run that the thing that will get civilization in the 21st century will be running out of resources (such as oil), not pollution (global warming). To me, much of this material about how the world will flood with global warming is hype.

However, most of the remedies for global warming would also deal with the problem of peak oil as well. These include cleaner and more efficient automobiles, limits on pollution at factories, and more efficiently operating industry, together with conservation. Further, the Club of Rome also suggested that if we get a gift from the heavens (or Alpha Centaurions) of a century's worth of oil, then pollution; i.e., global warming, will be a serious problem - it will cause billions of deaths and make the planet unlivable. So we need to heed the warnings of this special. In particular, President Bush needs to sign the Kyoto Treaty now.

Oil gets to 60 before I do

2005-06-27T19:07:00.000-07:00

Well, it looks like oil has done it. It has hit the big six zero more than a year before I will hit mine. Crude futures today in New York sold for $60.55 a barrel, or $1.44 a gallon. It is making gasoline and other oil-based products go up as well. It is due to the Saudis and other OPEC members not being able to convince the rest of the world that they can increase production. In fact, many in the oil business say that they no longer can, and if so, then maybe peak oil has been reached. Kenneth Deffeyes has been predicting that magic moment for 2005 November 24.

To me the important thing is when demand exceeds supply. If reduced supply reduces demand, that postpones that exceeding point. I predict that to occur in 2008. It then remains to be seen whether this will cause severe economic problems for the world, or whether it will cause such a reduction in demand that an oil glut will develop, despite production ability being in decline.

Once again I hear that part of the reason for crude's upward rise is refinery shortages. I don't know why they keep saying that. Maybe it's something they just say. But it does not make sense. Refinery shortages should cause crude prices to go down. If I am crude and can't get refined, then I am worthless. My price should drop then. No, the reason for the increase in crude prices is a perceived crude shortage, which is probably based on a real one. The latest fear is that Gödelized Iran will halt or slow down oil shipments.

I did a least squares fit on oil prices from 2004 January 1 to 2005 June 22, using data from the tax department of the state of Alaska. The resulting equation is:

Crude Oil Price = 35.12599281*exp(0.000852*t)*(1+0.044513*sin(0.0793*t+3.213698406))

where t is the time in days since 2004 January 1 and the argument of the sine is in radians. If you graph this function, you get a wavy exponential increase. There is oscillation going on, probably caused by 2004's huge increases. The formula predicts the following prices:

2005 July 1 57.25
2005 Sept 8 61.95
2005 Oct 12 58.46
2005 Nov 27 66.28
2005 Dec 30 62.55
2006 July 22 81.17
2007 Jan 1 92.69
2008 Jan 1 120.38
2009 Jan 1 163.51
2010 Jan 1 236.55

So that we will hve $237/gallon oil in 2010.

Oil crash coming?

2005-06-20T12:45:00.000-07:00

I found an article on CNN's Money web site today. Since this link will probably go dead in a few days, here is a quote:

SINGAPORE (Reuters) - The oil market may be quickly headed for a massive crash as global economic growth slackens, alternative energy gains ground and financial traders sense a price peak, an economist with Morgan Stanley said Thursday.

His projection for a multi-year bear cycle stands in sharp contrast to the super-spike scenario envisioned three months ago by Goldman Sachs, Morgan Stanley's arch-rival in the world of oil derivatives trading, where they are the two biggest players.

"As evidence of weakening demand and ample supply accumulates, the market may panic," Andy Xie, Greater China economist in Hong Kong, said in a report. "I believe it could correct in the most speculative fashion -- it could collapse."

This article is further evidence that people just don't seem to understand or want to talk about the possibility of cheap oil running out soon. They say that growth will slacken, that advances in alternative energy will be made, and that economists will think the price is getting too high and is forming a bubble. Sure these things will influence oil prices for a while, but there are many people that say that these are not going to make much difference. I happen to think that oil prices will continue to go up for the foreseeable future.

The price may very well crash. It may go down into the 40s or even the 30s. But then it will go right back up again, just like it did in February. If indeed the price is headed for a crash, it presents an investment opportunity. Sell out of energy stocks and bonds, wait for the crash to occur, then rebuy into them.

Peak Oil Looks Like a Real Cliffhanger

2005-06-13T11:22:00.000-07:00

Welcome to Cliffhanger, my newest blog. This blog will be devoted to Peak Oil and related issues, such as Global Warming, alternative energy, hybrid and fuel cell cars, development encroachment, and anything else that impinges on the health of this planet or on our supply of resources.

In my opinion, we have a cliffhanger coming in the next few years, and it is hard to say what will happen. According to many experts, including Kenneth Deffeyes, Colin Campbell, and Matt Simmons, world production of oil is nearing a peak, and despite rapid demand growth, especially from the United States, China, and India, production will decrease rapidly a few years after the peak is reached. Projections of the peak are anywhere from right now to 2112, with the median seeming now to be somewhere around 2008. After this, oil and gasoline prices will rise dramatically, and economic recession or depression, world tensions, possible famines, and other undesirable things will start to happen. A good review of what will happen to Suburbia can be found in the film The End of Suburbia, published by Postcarbon Books. A good site for describing these changes rather frankly is Clusterfuck Nation, by James Kunstler, especially his Chronicles.

Or will all this happen? Disaster has been predicted over and over again, especially by Colin Campbell, who always seems to be predicting imminent disaster. President Jimmy Carter in 1977 said that the peak was coming in the 1980s, but developments in oil extraction technology and discoveries in the North Sea and Prudhoe Bay has delayed this peak. The economists say that supply and demand will take care of the situation. There are alternative sources of energy, such as wind, tar sands, hydrogen, solar, coal, nuclear, and natural gas (but each of these has their own problems, especially the latter three). When oil becomes too expensive, these other technologies will take over. Further, technological developments will make what use of energy we do have more efficient. A good example of this is the Toyota Prius, which uses a motor to help maximize the efficiency of an internal combustion engine, resulting in a car with 50 mpg fuel economy. Because of this cliffhanger I see coming up, I have purchased a Prius.

So what will happen in the future? There is no denying that supply and demand is a powerful force. But will it fully address the Peak Oil problem? I think it is going to be a close call. This one is a cliffhanger, folks. This is why I have named my blog "Cliffhanger". I have chosen this blog as my Monday blog, on the most depressing day of the week, and after James Kunstler publishes his next installment of his Clusterfuck Chronicles. I expect that demand for oil will drop drastically when oil rises in price, causing conservation and technological developments to increase. This happened in the 1970s, resulting in a huge oil glut. It will happen again. But supplies will continue to dwindle. In my opinion, supply and demand will kick in, but it will result in a massive disruption in our way of life, as we convert from one set of lifestyles to another. The result will be a crisis, and this may be well the Fourth Turning that Strauss and Howe are calling for. The results of this disruption and adjustment to me are uncertain. And that is why I am monitoring this situation and have constructed a blog for it, in which I will report any developments I see on it and also my feelings about what is going to happen. I am hoping for a happy conclusion to this crisis but am still concerned.