The Oil Drum

jbunt

Humans are indeed complex, and many time present a conflicting paradox. For example (based upon 40 years of annecdotal observation of people who have an actual monetary stake in the event), if interest rates are rising sufficiently to say that a trend is in place, then the majority will see that trent continuing, no matter how high they get. Only when the trend turns down, will the majority believe that interest rates are going lower, a belief that the majority will hold until the trend reverses back up.

On the other hand, standing at the roullette wheel in Las Vegas, if red comes up 10 times in a row, the majority, if forced to bet, will bet on black "because red cannot keep comming up."

With respect to the two examples, for some reason people seem to follow the first one. People go to the gas station and there is always gas there. So, there is no shortage of oil, end of discussion. If the price is going up, it is the greedy bastards at the oil companies that are at fault. I view it as kind of the "draining bathtub." Assume that you are living in a world in which you were living under a giant bathtub drain, and you got your water by turning a valve causing water to come out. You had no way of measuring the size of the bathtub. For 100 years, everytime you turned the valve, the water you needed came out. But, people who had skills that you knew nothing about claimed that the tub was being emptied and not refilled and would shortly run out. But, such things had been said in the past and been proven wrong, and even now there was a vast disagreement among such experts. Well, a majority of humans would probably not listen to such arguments. They do not reject them as such, since they do not understand what the experts do, but it is just too uncomfortable to accept their allegations. In fact, you, and everyone that you know, continues to get all of the water that you are willing to pay for.

In the 70's, to get people to cut back, the government used "the line theory" to get people to believe that there was an actual oil shortage when the Arabs took ownership of the oil feilds from the US major oil companies and instituted an embargo. In Texas, you could get gas only between 6 am and 6 pm. In addition, you could only go on an odd or even day, depending upon your license plate. In addition, you were limited to only 10 gallons. Ergo, long lines. People then thought, gee there must be a shortage, look at the lines. You could put the same restrictions on supermarket shopping, get long lines, and convice people that there is not enough food.

If peak oil is about to occur, or if it has occurred, the majority will not act until they see the "trend" change, i.e., they go to the gas station and cannot get all that they want. If the majority of politicians believed that peak oil was a threat, they could now institute rationing to postpone the event and/or mitigate its effects. But, that is probably political suicide, so the odds are that we will all have to wait until the actual peak oil event forces rationing. And that is when all hell breaks loose.