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Reading The Runes: Spotting Trouble With Money And Energy Before It Bites You
Julian Darley, Post Carbon Institute
The trouble with uncertainty is that you can’t be sure of anything. You can’t even measure it by normal economic metrics and actuaries at insurance companies can’t assign a probability to it, as many have discovered regarding climate change and property insurance. It may be that all we can do with uncertainty is try to disconnect from the source of it and look for indicators and radar blips that will help us get out of the way of the worst effects, and if we do really well, start to construct a different kind of economy and supply chain.
One of the ingredients of uncertainty that many peak oil analysts have long predicted is volatility. Some others that I have also stressed over the last few years are threshold effects, unexpected linkages and cascades. To put it another way, once money and energy get tight in an over-globalized world, you can expect a pretty wild ride and don’t be surprised if a sheep lands on your head. There is a book about this phenomenon called the Black Swan. Maybe it should have been called the Black Sheep.
One very black sheep that has just landed on the heads of many British councils and ordinary citizens is the collapse of the Icelandic banking system. Yes Iceland. As if the British banking system, being partially nationalized as I write, doesn’t have enough problems of its own!
(16 October 2008)
Jim Puplava: Making Financial Sense of the Coming Energy Crisis (audio & video)
Peak Moment via Global Public Media
“We are living in historic times”, says financial consultant Jim Puplava. As reflected in his weekly Financial Sense Newshour, actually several hour-long podcasts, Jim has been factoring peak oil into his financial picture for several years.
In this interview plus excerpts from his presentation at the Association for the Study of Peak Oil (ASPO-USA) conference in September 2008, Jim talks about the “crisis window” opened by the current 2008 global credit crunch, and deepening over the next several years as oil supply begins its permanent decline. He provides some basic investment guidance for navigating the coming “perfect financial storm,” noting that our society will move of necessity from consumption to conservation. (www.puplava.com, www.financialsense.com, www.aspo-usa.com). DVDs of the entire conference can be ordered through ASPO-USA. This is the second of a series of Peak Moment Conversations videotaped at ASPO-USA 2008. Coming up: James Howard Kunstler, author of The Long Emergency, and Randy Udall, energy analyst and co-founder of ASPO-USA. The first was with energy investment banker Matthew Simmons on “Oil and Gas – The Next Meltdown?”
(13 October 2008)
Other Peak Moment episodes available at their site.
The Depression: A Long-Term View
Immanuel Wallerstein, Commentary No. 243
The depression has started. Journalists are still coyly enquiring of economists whether or not we may be entering a mere recession. Don’t believe it for a minute. We are already at the beginning of a full-blown worldwide depression with extensive unemployment almost everywhere. It may take the form of a classic nominal deflation, with all its negative consequences for ordinary people. Or it might take the form, a bit less likely, of a runaway inflation, which is simply another way in which values deflate, and which is even worse for ordinary people.
Of course everyone is asking what has triggered this depression. Is it the derivatives, which Warren Buffett called “financial weapons of mass destruction”? Or is it the subprime mortgages? Or is it oil speculators? This is a blame game, and of no real importance. This is to concentrate on the dust, as Fernand Braudel called it, of short-term events. If we want to understand what is going on, we need to look at two other temporalities, which are far more revealing. One is that of medium-term cyclical swings. And one is that of the long-term structural trends.
The capitalist world-economy has had, for several hundred years at least, two major forms of cyclical swings. One is the so-called Kondratieff cycles that historically were 50-60 years in length. And the other is the hegemonic cycles which are much longer.
In terms of the hegemonic cycles, the United States was a rising contender for hegemony as of 1873, achieved full hegemonic dominance in 1945, and has been slowly declining since the 1970s. George W. Bush’s follies have transformed a slow decline into a precipitate one. And as of now, we are past any semblance of U.S. hegemony. We have entered, as normally happens, a multipolar world. The United States remains a strong power, perhaps still the strongest, but it will continue to decline relative to other powers in the decades to come. There is not much that anyone can do to change this.
The Kondratieff cycles have a different timing.
(15 October 2008)
A Peak Portfolio
Bill Paul, Energy Tech Stocks
Believe in Peak Oil? Then Now is the Time to Begin Building a Peak Portfolio – Part 1 of 3: The Producers
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With a recession looming and many experts predicting that oil prices in 2009 will be a lot lower than they were this year, why would anyone choose now to start buying stocks based on the theme of “peak oil?” Because recessions end and if you believe, like Charley Maxwell and others do, that when this recession ends the age of oil scarcity will arrive like an apocalyptic horseman, then now is the time to start getting ready, before peak oil’s telltale signs cause the Wall Street herd to stampede into peak-themed equities.
As Maxwell of Weeden & Co., the “dean” of oil analysts, told EnergyTechStocks.com in an exclusive interview, whenever the current recession ends the world will discover that there isn’t enough oil to go around. Nobody can predict exactly when a recession will end, but Maxwell is certain this one will end before electric vehicles and cellulosic ethanol have had time to make a dent in global oil demand. Pump prices in the U.S. could hit $15 a gallon, he believe
(20 October 2008)
