From "What the Fundamentals Say. . . " uptop:

Fearless Prediction

Considering all of the above, my five year forecast for the oil price range is:

2008: $80 - $140

2009: $105 - $195

2010: $150 - $250

2011: $175 - $325

2012: $275 - $500

As Matt Simmons has pointed out, gasoline at the pump is currently priced at about $300 per barrel in some areas in Europe.

Interesting that the Millennium Institute T21-USA model calls for $350/barrel oil in 2011. However, the economy "cracks" that year and oil falls to below $200 in 2012 due to "reduced economic activity" conserving oil and reducing demand. By the end of 2012, oil is above $200/barrel and never drops that far again.

I saw a curve you had prepared by Khebab of a price range in Houston. I would find that of interest.

Best Hopes for Wendi & Brian (inside comment for the time being, more later),

Alan

They are really cool people, and we had a very good visit with them. They are now northbound, hoping to link up with PG.

In the old Maya culture, the end of the current world cycle (which lasted more than 5000 years) is the winter solstice 2012. How fitting ! :)
Seriously, we need alternatives NOW !

Seriously, we need alternatives NOW !

We have PLENTY of alternatives:
Powerdown
War (vs buying things via the petrodollar/trade)
Less consumption
Less population

Most people don't like such alternatives.

http://www.siam.org/news/news.php?id=827

Eigenvalues. Fixed points. Stable equilibria. Mathematicians like things that stay put. And if they can't stay put, the objects of study should at least repeat themselves on a regular basis, like orbiting planets or populations of predators and prey. Even in the case of chaotic systems, mathematicians have traditionally gravitated toward invariant features, such as strange attractors, stable manifolds, and periodic points.

What makes this tradition possible is that dynamical systems---at least the ones mathematicians favor---are governed by equations that depend on time either cyclically or not at all. But nature doesn't always oblige. Many phenomena require equations whose coefficients are non-periodic functions of time. Indeed, many---arguably most---phenomena can be described not by equations at all, but only as an amalgam of time-varying data.

http://www.larouchepac.com/news/2007/12/28/larouche-whole-operation-paki...

"People are being idiots," he said, "because they say, well, `You can't say that! Let's concentrate on the facts. Let's concentrate on the facts,' is what they'll say. Now here you have, the fact is, we're in the point of a total breakdown of the international financial and monetary system. This is not a collapse; this is not a depression. It's a disintegration of the very integument upon which the whole civilization has now come to depend. That's the game. And, any developments which don't fit the game, don't explain this kind of thing. It's one thing after the other; it's a chaos operation. The tendency is to create chaos; it's a chaos operation. So, therefore, in a chaos operation,-- don't try to attribute chaos, to some individual who's not chaos.

"We don't know who the culprit is; we don't know which faction, who is the faction," LaRouche concluded. "We can identify the faction by the nature of the faction. But the identity of the faction, we don't have. The guy who's doing this, is doing something. We know what they're doing; we know what the effect is they're playing for. That's clear. WHO that someone is, we don't have."

chaotic systems have "attractors" or stable repeating phenomena by definition, pattern just has to be discovered.

http://en.wikipedia.org/wiki/Chaos_theory

Cool to read up on this.

In quantum mechanics when a quanta is released/absorbed the energy of the particle goes up/down one whole step. A gradual change from point A to B does not happen. I don't see why it should not so happen in economic cricumstances when the enrgy goes out of the system all at once. We fall to a new steady state. Economists, stock market watchers and historians have observed lots of chaotic patterns in history, the chaotic "attractors" seem to be similar to the seasons, 4 year cycle, average human life span, civilizational cycle, etc. If Larouche can't find a cyclical ("chaotic") pattern in this systemic breakdown which fits he could read Diamond.

What you are discribing is a State Change or Phase Change, Like when a whole school of fish suddenly turn right.

Liquid to solid. All at once.

Complex Systems Break Down Chaoticly

Chaotically, and in our case due to multiple forces of environmental friction and degradation, rapidly.

Lyndon LaDouche.

I sure hope you are making sweet, sweet fun of that lunatic by posting his ravings.

While what he says may or may not come to pass, it will not be due to anything he posits.

For more fun info about this fascist demagogue:

http://www.publiceye.org/larouche/

I stand with him when he's correct.

The clearest statement yet on chaos theory and the Power Laws in relation to human self organized criticality.

With chaos theory you have attractors or repellers.

The attractors, as noted above by GS in this thread, are most easily seen-as in smoke rings (the smoke particles adhere to the vapor ring).

Less easily seen are the repellers-the force leaks or repels,
say, liquid particles (blood, for instance).

You can only "see" the repellers from "future rewind".

Think an eddy. The blood hits the eddy before traveling to,
say, the face instead of the brain. Which way will the blood flow?

Same with LaRouche's statement. A repeller is forcing
chaos into a new steady state.

Ok I reread the Larouche quote then your suff again and I got the message. Thanks. Repellers forcing inot a new steady state, very good. I keep learning at TOD all the time.

Most people don't like such alternatives...
Guess you are talking about those less than 5% of the world population that just happen to live in the US ? :)
The same that consume 25% of the world's oil ? Maybe the rest of the world will adapt more easily actually ?

Exactly, STS. Thanks for saying it.

Just Heard this song on NPR: I think that if we are going to choose to listen to someone other than Uncle Dave we will surely end up nude in a cave without food. It's time to take Uncle Dave seriously. He's not a manic depressive, just a freakin realist.

Uncle Dave's Grace: lyrics by Peter Berryman, music by Lou Berryman

"We gather together to ask the Lord's blessing" Thanksgiving day, Uncle Dave was our guest

He reads the Progressive which makes him depressed

We asked Uncle Dave if he'd like to say grace,

A dark desolation crept over his face

"Thanks," he began as he gazed at his knife,

"To poor Mr. Turkey for living his life

All crowded and cramped in a great metal shed

Where life was a drag then they cut off his head"

"Thanks," he went on, "for the grapes in my wine

Picked by sick women of seventy-nine

Scrambling all morning for bunch after bunch

Then brushing the pesticides off of their lunch

Thanks for the stuffing all heaped on my fork

Shiny with sausage descended from pork

I think of the trucks full of full of pigs that I see

And can't help imagine what they think of me"

Continuing, "I'd like to thank if you please

Our salad bowl hacked out of tropical trees

And for this mahogany table and chair

We thank all the jungles that used to be there

For cream in our coffee and milk in our mugs,

We thank all the cows full of hormones and drugs

Whose calves are removed at a very young age

And force-fed as veal in a minuscule cage"

"Oh thanks for the furnace that heats up these rooms

And thanks for the rich fossil fuel it consumes

Corrupting the atmosphere ounce after ounce

But we're warm and toasty and that is what counts

I'm grateful," he said, "for these clothes on my back

Lovely and comfy and cheap off the rack

Fashioned in warehouses noisy and cold

In China by seamstresses seven years old"

"And thanks for my silverware setting that shines

In memory of miners who died in the mines

Worn down by the shovelling of tailings in piles

Whose runoff destroys all the rivers for miles

We thank the reactors for our chandelier

Although the plutonium won't disappear

For hundreds of decades it still will be there

But a few more Chernobyls and who's gonna care?"

Sighed Uncle Dave, "though there's more to be told

The wine's getting warm and the bird's getting cold"

And with that he sat down as he mumbled again

"Thank you for everything, amen"

We felt so guilty when he was all thru

It seemed there was one of two things we could do

Live without food, in the nude, in a cave,

Or next year have someone say grace besides Dave.

122112

Now that's a magic number.

http://www.levity.com/eschaton/Why2012.html

Why: Winter Solstice Sun Conjuncts The Sacred Tree in 2012 A.D.
First, the tzolkin count originated among the Olmec at least as early as 679 B.C. (see Edmonson's Book of the Year). We may suspect that astronomical observations were being made from at least that point. The tzolkin count has been followed unbroken since at least that time, up to the present day, demonstrating the high premium placed by the Maya upon continuity of tradition. In this way, star records, horizon positions of the winter solstice sun, and other pertinent observations could also have been accurately preserved. As suggested above, precession can be noticed by way of even simple horizon astronomy in as little time as 100 to 150 years. (Hipparchus, the alleged "discoverer" of precession among the Greeks, compared his own observations with data collected only 170 years before his time.) Following Edmonson, the Long Count system may have appeared as early as 355 B.C. Part of the reason for implementing the Long Count system, as I will show, was probably to calculate future winter solstice dates.

We must assume that even at this early point in Mesoamerican history, the crossing point of ecliptic and Milky Way was understood as the "Sacred Tree". Since the Sacred Tree concept is intrinsically tied into the oldest Mayan Creation Myths, this is not improbable. At the very least, the "dark rift" was already a recognized feature. Early skywatchers of this era (355 B.C.) would then observe the sun to conjunct the dark ridge in the Milky Way on or around November 18th.5 This would be easily observed in the pre-dawn sky as described above: the Milky Way points to the rising sun on this date.

So that Solaris can then walk across the Milky Way "path"
to Polarus.

Starting the new Age of Aquarius.

Thank you, GS

Did you read Polaris or see the original Russian film or just the recent hollywood version?

Are those in real 2007 US$ or nominal? If those are real, the actual numbers might have to be adjusted upwards for inflation by another 10%+ per year the way things are going.

Exactly.

As in, what will a bottle of beer cost at the
same time.

Or, Sudan changes over to the Euro from the $.

I found that to be a excellent analysis, I was impressed. But then, I read the first comment, and, ...wow..."...Capitalism has always worked...capitalism + technology = lower prices for everything--everything....tulips, oil, dot-com, housing-energy will be next."
It's what we're up against- an almost religious belief that 'capitalism' trumps geology, trumps climatology, trumps physics. It's 'magical' thinking-- waiting for the 'invisible hand' to bring these prices down.
Can't reason with people that invest capitalism with supernatural powers. It's a stubborn belief.
My guess is 2008 we will have continued high prices and the cargo-cultists themselves won't lose credibility.
Gas prices will stay high and the capitalism-cultists will say the answer is obvious- "More Capitalism!!"

Yeah. The Easter Islanders' reaction to impending collapse was to build even bigger stone statues. I expect we'll do the same. When capitalism doesn't work, the solution will be more capitalism. Environmentalists, government regulations, and NOCs will get the blame for "not letting capitalism work."

Yes I seem to remember reading in one of Thor Heyerdahl's books that the biggest statue of all was one that was still not completely finished. This means they were in the process of making it when their society collapsed and the work stopped.

You're right, though I read it 40 years ago I do remember that. Thanks, that's a wonderful observation to bring up in this context.

I think we should all start building giant stone heads again. Not only would be every bit as useful as most of what we're doing, but it would be cool on so many levels.

I want one.

Hello Greenish,

What I think would be really cool would be the massive stockpiling of organic and inorganic NPK, grain reserves, strategic reserves of bicycles & wheelbarrows & canoes, and the building of massive SpiderWebriding canal networks as outlined in my prior postings.

Worship of vital biosolar mission-critical items will get us further down the decline path in a more optimal fashion than dancing around stone carvings.

Although, I will grant that carving heads in the likeness of failed postPeak politicians may serve a humanure recycling purpose. Recall my previous post on animal territorial boundary marking by urination and defecation; a good way to move nutrients far from polluting water sources.

Angry postPeakers might be willing to hike the extra mile to piss or poop on these designated 'shitheads'.

Bob Shaw in Phx,Az Are Humans Smarter than Yeast?

Hey there Bob.

I agree with you entirely. The reason for building stone heads would be in the nature of performance art. A reductio ad absurdum visual aid for those who are ironically impaired when it comes to perspective on our industrialized creation of clutter. Every stone head would get local and perhaps national press, and the message would be that we're on the same path as the Easter islanders. (whether or not it happened as Diamond said, it's a good meme-set).

If there were ever to be a peak oil mascot, he should have the classic stone-head features.

I don't personally have the excess energy to carve a stone head, so perhaps I'll just have "Look upon my works, ye mighty, and despair" silkscreened on my speedo.

VIRAL SUGGESTION: get stencils and start spray-painting easter island heads on SUV's in tacky-colored paint. (always obey local laws and secure permission from the owners beforehand).

Homer-Dixon found a temple likewise abandoned. If I remember, a piece of marble something like 450 tons. He discusses it in Upside.

The whole angle where the PTBs - and maybe society as a (w)hole - try every harder to do what doesn't work fascinates me. Even now one can see that the "solutions" being advanced in the mainstream only make things worse.

cfm in Gray, ME

I expect we'll do the same. When capitalism doesn't work, the solution will be more capitalism. Environmentalists, government regulations, and NOCs will get the blame for "not letting capitalism work."

Its likely to be the exact opposite: Socialism! When things get tough, politicians promise more handouts and more subsidies as a means to get elected. "Vote for me, and I will give everyone free food/gas/whatever, but you'll need to give me more authority so I can end corruption/other lame excuse for more centralized control"

This usually causes a transition away from free markets into centralized control which can lead to totalitarianism. The countries with the highest levels of socialism and central control are the first candidates to fall into Totalitarianism. I believe at least some of Europe will swing this way. I think the US will become decentralized as Washington remains a quagmire and states are force to pick up more an more responibilty as Washington falls to accomplish anything. Another words I expect the United States to become the Divided States of America.

This usually causes a transition away from free markets into centralized control which can lead to totalitarianism.

It could be argued, and many have argued, that rather than 'free markets' we now have centralized control where control is in the hands of large banks and multi-national corporations. This is a de-facto form of totalitarianism already and appears to me to be getting worse as economies weaken.

It never ceases to bother me how people continually ignore the fact that the arguably best societies to live in today in terms of quality-of-life measures such as health care, education, low crime rate, high standard of living, are societies that are a healthy mix of socialism, free markets and democracy. About 99% of the socialism bashing I've seen on the web is totally ignorant about the current state of socialism as it is actually practiced.

Yes, but I think that, like the happy motoring lifestyle, is a brief artifact of the Age of Oil.

I hate the whole happy motoring phrase. we get it, you don't like cars and mock the idea that we were stupid enough to drive them. you're above us.

happy motoring is not dead, it's just going electric. what makes you think we need to power our cars with gas? my computer doesn't need a gas tank. my cell phone doesn't need one. my tv doesn't need one.

future generations will look back and laugh at the ICE. they'll wonder why we used such an inefficient motor with such a dirty fuel. we read on our laptop computers about computers that used to take up a whole block.

Hardly. I own a car, and I drive it.

The phrase is Kunstler's. He's not just talking about cars. He's talking about our entire unsustainable society.

"He's talking about our entire unsustainable society."

the system will correct itself and become more sustainable. won't be pretty, but it will happen.

I agree that it will correct itself, and it may not be pretty.

I don't agree that it will become more sustainable. I fear very much that it will become less sustainable. How did we deal with the gasoline shortages after Katrina? We suspended environmental regulations, allowing more polluting gasoline.

I see a lot more of that in our future. Even if we somehow resist...what about Asia? Africa? South America? Already, they are building coal plants like crazy, because there's not enough oil and natural gas.

See, this is the problem I see with capitalism. Not all costs are accounted for. The costs to the environment are paid by everyone, including future generations....not by those who are earning the profits. So what incentive is there to pursue sustainability?

People like TechGuy will never get it.

They are totally immersed in the propaganda. He needs to read Naomi Wolfe's book, "Letter to a Young Patriot."

We are already living in a fascist state. The idea that more capitalism leads to more freedom is painfully ludicrous.

Let's list the capitalist fascists:

ADOLF HITLER
Chancellor of Germany
BENITO MUSSOLINI
Prime Minister of Italy
HIDEKI TOJO
Prime Minister of Japan
CHIANG KAI-SHEK
President of Taiwan
NGO DINH DIEM
President of South Viet Nam
PARK CHUNG HEE
President of South Korea
MOHAMMED ZIA UL-HAQ
President of Pakistan
FULGENCIO BATISTA
President of Cuba
RAFAEL LEONIDAS TRUJILLO
President of the Dominican Republic
FRANÇOIS & JEAN CLAUDE DUVALIER
Presidents-for-Life of Haiti
GENERAL HUMBERTO BRANCO
President of Brazil
COLONEL HUGO BANZER
President of Bolivia
GENERAL JORGE RAFAEL VIDELA
President of Argentina
ALFREDO STROESSNER
President-for-Life of Paraguay
GENERAL AUGUSTO PINOCHET
President of Chile
MOHAMMAD REZA PAHLEVI
Shah of Iran, King of Kings
GENERAL FRANCISCO FRANCO
President of Spain
ANTONIO DE OLIVEIRA SALAZAR
Prime Minister of Portugal
GEORGE PAPADOPOULOS
Prime Minister of Greece
GENERAL IDI AMIN DADA
President for Life, Uganda
TURGUT OZAL
Prime Minister of Turkey
FERDINAND MARCOS
President of the Philippines
SIR HASSANAL BOLKIAH
The Sultan of Brunei
GENERAL SITIVENI RABUKA
Commander, Armed Forces of Fiji
GENERAL SUHARTO
President of Indonesia
MAXIMILIANO HERNANDEZ MARTINEZ
General of El Salvador
ANASTASIO SOMOZA, SR. AND JR.
Presidents of Nicaragua
GENERAL EFRAIN RIOS MONT
President of Guatemala
ROBERTO SUAZO CORDOVA
President of Honduras
GENERAL MANUEL NORIEGA
Chief of Defense Forces, Panama
VINICIO CEREZO
President of Guatemala
ALFREDO CRISTIANI
President of El Salvador
HALIE SELASSIE
Emperor of Ethiopia
IAN SMITH
Prime Minister of Rhodesia
P. W. BOTHA
President of South Africa
GENERAL SAMUEL DOE
President of Liberia
MOBUTU SESE SEKO
President of Zaire
HUSSAN II
King of Morocco
PERVEZ MUSHARRAF
President of Pakistan
KING ABDULLAH,
Saudi Arabia
HASTINGS KAMUZU BANDA
Malawi

Well, I could actually go on for some time if I included all the American governors of foreign occupied lands throughout American history. You may also note that almost all of these fascist dictators came to power with the help of the United States. Aren't we just the best ol' bunch of Democracy spreadin'weasels what money can buy?

Ahhhhh. Can't ya smell the freedom. Kinda smells like, "SHUT THE F UP AND BUY SOME MORE USELESS STUFF."

It could be argued, and many have argued, that rather than 'free markets' we now have centralized control where control is in the hands of large banks and multi-national corporations. This is a de-facto form of totalitarianism already and appears to me to be getting worse as economies weaken.

Pure BS. You haven't got the foggiest idea what totalitarianism is like. If you think Socialism is so good, then please relocate to Cuba, Venzeula, or China. I am sure they'll welcome you.

I think when ET so offended you by talking of mixed economies having the highest quality of life, he was referring to Germany, France, Belgium, the Netherlands, Sweden, Denmark or Canada, all but one America's NATO allies during the Cold War, and many of them with elected Socialist governments at times.

And if you think corporations running everything is freedom, then move to the McAllen Free Trade Zone, a NAFTA artifact created on the Mexican border consisting of nothing but shoddy factories for multinational corporations. I learned about in a case of a traffic fatality that became a lawsuit because dig it, the law in the Zone is made by a council of those corporations, with number of votes depending on how much money they have invested, and it seems these bastards never bothered to work out how their 18-wheelers were supposed to park on the narrow streets. A libertarian paradise, indeed.

The McAllen Free Trade Zone is the USA's plan for the Third World, but it probably is now doomed by China's cheaper, better educated workers who have more hope for a future not under foreign domination. Its form of governance, however, may have become Bush & Cheney's plan for the USA.

Canada has never had a socialist government. We have had, and still have, the occational provincial NDP government (socialism). Some have had no choice but to govern in the middle, others, like the NDP Ontario government of the 1990s was a dismal failure. They almost bancrupted the province and spent $100 billion more than they brought in in taxes and that's after they raised taxes to record highs. The following conservative government tried to fix things by slashing the socialist programs and spending and reduced taxes, but got blamed for making the mess in the first place!! How utter common for socialists.

Federally the Liberals are slightly left of centre. They campaign from the left, but govern once in power from the right. So they con the public into making them vote Liberal as being the "socialist" compassionate party of the left, but once in power they swtich sides and govern like true capitalists and pay lip service to the politicies they claim to represent (hence the all talk about climate change, but did nothing about it in 10 years allowing emissions to increase 30%)

So yes, we do have some social programs, like health care, but be very aware that these are not cheep. There is no free health care in Canada. 5 years ago the Ontario (Liberal) government increased personal taxes by $900 per person per year to help pay for ever skyrocketing health care in the province that consumes 45% of the provinces total budget and grows at 11% per year.

Now if they did not have to spend $11B each year on interest payments on the $120B debt the province racked up because of the NDP government, they would have more money to spend on social programs.

Bottom line to this argument is that a pure capitalist government (far right) and a pure socialist government (far left) don't work. What works is a balance. A middle ground and compromise. That's what we have in Canada and you will find the other sucessfull "socialist" governments in the world are that way too.

Jr: The NDP did very poorly in Ontario-OTOH they had a lot of help from the Three Stooges-John Crow, Brian Mulroney and Michael Wilson.

Not quite, though they did help. If that was so how come the other provinces did not do as bad?

Even Bob Rea, the turn-coat to the Liberals, has admitted his NDP policies were wrong. Hence his move to the Liberals.

"When things get tough politicians promise more handouts and more subsidies as a means to get elected. 'Vote for me and I will give everyone free food/gas/whatever...' "
Hmmm, in what country? Because it occurs to me that in this country politicians compete to make life ever more difficult for the poorest citizens. Have welfare benefits expanded or contracted? Unemployment and worker's comp programs? Has bankruptcy been made simpler and easier or made almost impossible?
My point is that in this country the politicians most passionate in their embrace of 'capitalism' are also those asking us to sacrifice liberty for 'security'.
But perhaps you see Sweden as a nascent Soviet Union. whatever.

The "poorest citizens" usually don't/can't vote...

"When things get tough, politicians promise more handouts and more subsidies as a means to get elected. "Vote for me, and I will give everyone free food/gas/whatever, but you'll need to give me more authority so I can end corruption/other lame excuse for more centralized control""

Actually, recent history has not shown that. What we've seen is the 'Politics of Fear'. Politicians constantly raise fearful images and then offer to protect the cowed populace if they are given votes and more power. This is a lot cheaper and easier for politicians than actually delivering on benefits for consumers. Besides, I don't recall politicians promising free anything. They do claim they can improve the economy so that you can get a job and earn consumer goods. Medicaid and Social Security are exceptions. Here the govt is acting as a very efficient insurance company (very low overhead).

I wonder if it is likely that any stone age culture would start off building huge statues and progressively build smaller ones.

Well, I'm not sure that the biggest Egyptian pyramid was the last one.

The Chinese terracotta warriors are an example of shrinking. They started out larger than life, but later models were 1/3 life size.

You could see that happening if they ran out of resources.

It didn't happen that way, because the statues were too important, but if they weren't, you could see it going that way.

Not giant stones: new bombs, new missile systems, new surveillance systems, new "detention centers" (what did they used to call them?) Giant stones wouldn't be all that terrible.

Capitalism must expand or die, and we know what happens in that model in a finite resource base. Any smart 10 year old will tell you it won;t work, but our classical economists believe in this superstition based system, where Capital is God, and The Free Market is the chosen path. We can do much better if imagination and skill are used,. If not, we will go the way of the 99% of species that are now extinct. Extinction is the norm.

The invisible hand (&trademark;) will take care of you. Right after it gets done slapping you silly.

DTI--
More like the "Invisible Fist", with the help of the State (capitalism has never existed without a strong state to enforce it's rules, as it emerged in the Italian City States of the 15th century, to the global World Bank and IMF)--
When the State collapses, so will capitalism.
Of course, this probably will be a bit messy.

I agree. high oil prices will slap you in the face and say stop using so much oil. car pool. grow more of your own food. get a PHEV.

"It's what we're up against- an almost religious belief that 'capitalism' trumps geology, trumps climatology, trumps physics. It's 'magical' thinking-- waiting for the 'invisible hand' to bring these prices down.
Can't reason with people that invest capitalism with supernatural powers. It's a stubborn belief."

that's a rather misinformed view of capitalism. price takes into account all those you mentioned. when something gets scarce the price goes up, people use less of it and switch to something else or nothing at all.

higher oil prices greatly increased the MPG of cars in the 1970's. oil was phased out of the grid.

if capitalism isn't the solution we have a real big problem.

if you're a car company, rising gas prices mean you have to develop a car that uses gas more efficiently or else you won't sell cars anymore.

what you get is a $20,000 chinese PHEV that gets 100MPG.

what you get is the volvo recharge that gets over 100MPG and can travel as much as 60 miles on battery power alone.

that's twice what most people drive roundtrip for work.

if capitalism isn't the solution we have a real big problem.

Bingo. If capitalism was the solution, I doubt many of us would bother hanging out here in the first place.

I believe capitalism is the solution. higher gas prices=more efficient use of oil.

worked during the 1970's.

I believe capitalism is the solution.

Then why bother coming to this web site? There's nothing to worry about. Your online time is probably better spent on eBay or Second Life.

worked during the 1970's.

No it didn't. The '70s was just peak oil USA. We started using other people's oil, rather than our own. That won't work with the global peak.

Then why bother coming to this web site? There's nothing to worry about. Your online time is probably better spent on eBay or Second Life.

That's so not fair Leanan. So anybody who thinks that the free market could potentially solve renewable energy problems and create new transportation options is some sort of nut here and there time is better spent buying crap?

So anybody who thinks that the free market could potentially solve renewable energy problems and create new transportation options is some sort of nut

No. My point is the free market is what we are doing now. If you're confident that that's the solution, why hang out here? We're already doing what it will take to solve the problem. Nothing to see here, move along.

and there time is better spent buying crap?

No, silly. Selling crap. You can make a lot of money on eBay and Second Life. Isn't that what a good capitalist would do?

Leanan, how about this theory: For capitalism to stand a snowball's chance of addressing peak oil it needs to have the appropriate information. CERA and a lot of other groups seem to be obsessed with telling the market that the price signals we have seen over the last few years are abberations. Believers in market mechanisms who recognize the scale involved in replacing oil also recognize the need to raise peak oil awareness as we are out of time.

BTW, a belief in just in time tech isn't what I am advocating. I am advocating intelligent decisions about conservation, production / extraction and the apparently viable technologies we have in hand [rail, nukes, wind and solar if we can just keep chipping away at the cost.]

For capitalism to stand a snowball's chance of addressing peak oil it needs cradle-to-grave pricing of its products, and zero externalized costs. As the recent Bali negotiations have again illustrated, it's unlikely to happen in a manageable timeframe.

well, first of all, in relation to the '70's, I believe that CAFE standards had a little something to do with an improved market for fuel efficient vehicles, along with lowered speed limits.
Now, to illustrate your belief that capitalism is capable of responding to PO, you bring up as an example a Chinese PHEV that supposedly costs $20,000 and supposedly is capable of 100 mpg. (is that the best you can do?)
My response is basically that there is no way on God's green earth that any PHEV will be able to have a fraction of the utility and flexibility of today's ICE vehicles at any sort of mass-market price point using any present day technology.
Your asserting otherwise indicates to me, rather, a belief in some sort of divine agency. I'm sure that must be comforting.

"My response is basically that there is no way on God's green earth that any PHEV will be able to have a fraction of the utility and flexibility of today's ICE vehicles at any sort of mass-market price point using any present day technology."

you don't see how good a 100mpg car would be good? why wouldn't it have the utilty? it uses gas and electricity to get better MPG. it's perfect.

the chinese PHEV is just $20,000. many PHEVs would probably pay for themselves. we produce millions of cars, it's not going to be that hard to put batteries in them.

I do see how it would be good. I do see PHEV's as having an important niche application post-peak. I do see them dramatically increasing their market share.
But I also see that market as being a dramatically poorer market than today's car market, almost unimaginably so, due to the effects of PO.
To be clear, I think we are stuck with a basic capitalistic system for the duration-the 20th Century did clarify a few things for us.
But faith-based capitalism, this magical thinking that technological bounds are self-imposed and that all fuel sources are replaceable and substitutable , sorry, that's crap. Ethanol is not gasoline. Shale is not crude. Prototype PHEV's are not F-350's.
I think it was back in the '20's they had an expression, "Rain follows the plow." Because it seemed to.
Until it didn't anymore.

"this magical thinking that technological bounds are self-imposed and that all fuel sources are replaceable and substitutable , sorry, that's crap"

no it isn't. when the price of something goes up, in this case gasoline, people use it more efficiently. as the price of gas goes up, we'll see more and more hybrids and PHEVs because they use gas more efficiently. eventually we'll see electric cars. this is basic capitalism and supply and demand.

we can use electricity to power cars.

I'm sorry john15, but I think you're way optimistic on this one:

as the price of gas goes up, we'll see more and more hybrids and PHEVs

The price of gas has gone up dramatically. The market hasn't responded by purchasing more efficient machines but instead people are driving older ones that are paid off. That dynamic will continue until the price rises to the point where they can't drive them at all. Inflation in other areas such as food and heating/cooling expenses are also a component of the estimate.

Your statements seem to indicate you believe we'll have time to transition and no pain between now and then. Cantarell functionally goes away in twenty four to thirty six months. We don't have time for a slow migration. We're only going to need one season of crops rotting in the field due to diesel shortage before we're on a war footing with farmers getting to the head of the line no matter how much everyone else howls ... and that is the worst case. I fully expect some sort of policy change to ensure our food supply before it comes to that.

We can power cars with electricity. But cars are an artifact of the oil age and the oil age is over.

"The price of gas has gone up dramatically. The market hasn't responded by purchasing more efficient machines but instead people are driving older ones that are paid off."

It's amazing how people change their behavior when prices rise.

Buyers focus on fuel efficient cars
http://www.tampabays10.com/news/local/article.aspx?storyid=70778

"Larger vehicles still sell, but it's the hybrids and other fuel efficient cars that have been going more quickly."

"But cars are an artifact of the oil age and the oil age is over."

the age of cars powered exclusively by gasoline is coming to an end. that's good because it's not as efficient as an electric motor.

the long transition resumes. for me the transition began in the 1970's.

As cars get more efficient, and the old ones truly wear out, we will see the gradual transition to them, until the capability of driving them, using any kind of energy derived from FF, makes even them impractical.

Having seen another post mentioning Kunstler, the title which has gotten him the most attention is called, after all, "The Long Emergency", and that is what it is. While things are not progresing as he would prescribe for us to avoid the pain, anguish, and mutual disaster, it is going to be long. But there is an end to it, and it will not be pretty. It will pay to get ready now, and do what you/we can to avoid as much of the problems as we may, whether in the realm of energy, CC/GW, financial disaster, food and fertilizer shortage, or whatever.

As for myself, while I am wearing the others out, I am hedging with a CNG vehicle to go with my bike and Rhoades Car, and dropping a few pounds as well.

I can't understand the thinking that electric or other more efficient personal transport will solve or ameliorate the overall or even our own personal PO problems.

What about all the utility vehicles, the vans and trailers towed by tradespeople. The small trucks for delivery and business. Where are the replacements for those. The trucks that deliver concrete, bricks and lumber and food products.
What about ambulances, fire engines, police cars and taxis. When they all stop running or just slow down the economy is for all intents and purposes, dead.

The focus should be on alternatives to what keeps us employed, not personal transport.

We won't need two cars per family and cars for pleasure, if we can't keep business, big and small viable.
We need the jobs and consumerism to maintain our way of life.

What will our need be for an electric cycle or car if we have no productive use for them?

As the price of gas goes up, you will see more and more people park them, unable to afford to drive them. People already upside down on their loans. People unable to make it in to work. Are these the people who will be rushing in to the dealerships?
I propose to you a simple exercise. Just go to an overpass over a major freeway (I have I-5 in mind, but they're all basically the same). Stand there for a few minutes and inventory the flow, from the particular to the general and back.
Now. Be honest. Can you truly envision a seamless transition to an electric powered vehicle fleet ?
If you can, then that, I would submit, is the power of faith over reason.

"As the price of gas goes up, you will see more and more people park them, unable to afford to drive them. People already upside down on their loans. People unable to make it in to work. Are these the people who will be rushing in to the dealerships?"

if people park them, I guess they aren't so important after all, right? they are just a function of the low cost of gasoline. not everyone is upside down on their loans. gasoline is still only about 3% of people's income. if oil is as important as people say then they won't park them. if they do park them, voila, there is your demand destruction. there is your post PO transition.

those that want to drive will trade in their cars for a more fuel efficient one. maybe one with an ICE. maybe a hybrid. maybe a PHEV. replacing your ICE very soon will be like replacing your furnace. it practically pays for itself. it's hedge against a rise in gasoline prices. say you bought a car that saves you $1800/year for $25,000. that's a 7% return and it just gets better if prices keep going up.

I never said it would be pretty, someone set that straw man up.

Faulty assumptions in a world with credit blowing apart. Sorry, but one dimensional analysis doesn't work in a complex world.

the world is more complex than credit is blowing apart. some can borrow. some can pay cash. houses are selling. cars are selling. they aren't selling as much but that's the point.

Capitalism is the fundamental economic relationship between humans. It's been there ever since the first man chipped more spear points than he could use or the first woman dug up more roots than she could eat. Capital comes from all the extra that humans can (and want to) produce. It is the essence of cooperation and everything that is good about people.

Disagree. You're talking about trade. That will always be around.

Capitalism is not trade. And the difference is charging interest. That is what makes an economy dependent on infinite growth. Islam permits commerce, but does not allow usury.

No, I'm not talking about trade. I'm talking about productivity, the ability to produce more than you need. That is the fundamental of capitalism. That's what allows saving and investing.

I enjoy the various icons people on this Site use such as SUV and McMansion, etc. But the quintessential icon for the American Consumer has to be the Public Storage Unit for the McMansion owner who needs the extra space.

I would still say that is not capitalism.

Usury was frowned upon in the ancient world, and not because they looked down on productivity. It was because the burden of paying interest was very heavy in a steady-state economy. And because such an economy could not support many people who didn't produce actual goods. (For example, "money-changers," who acquired wealth but didn't actually produce anything tangible to get it.)

The ability to produce more than you need...I'd call that agriculture, not capitalism. I would also argue that it was not necessarily a good thing for humanity. Agriculture - basically growing grain, since it can be stored - is great for the wealthy, but not for everyone else. Jared Diamond argues that agriculture is the worst mistake in the history of the human race.

Before agriculture, the way people "invested" a surplus was to share it with their neighbors. Most foods do not keep long, and money, jewelry, etc., don't mean much if there's not enough food to go around. So the best thing you could do with a surplus was to invest it in your neighbor's goodwill. There would then be a good chance that they would share with you, when they had plenty and you did not.

Agriculture changed that. It made hoarding possible. And the previously egalitarian societies of our hunter-gatherer past became much less so.

I'm not arguing we can or should go back to that. I seriously doubt it's possible, for one thing. But "productivity" is not a universal good. Far from it.

I have a hard time equating agriculture with producing Clovis spear points. Agriculture has to do with the production of foodstuffs.

To me, capital is the excess of production that you don't need for your own consumption. Of course, when you mix in the notion of money, the system can become wildly complicated (and corrupted when the government gets involved).

Sorry leanan I had trouble getting into my troll armor (too much xmas cheer).

OK, now.... I got your back leanan.

You take the smarter one and I will run... I mean dispense the other.

AHHHHHHHHHHHHHHHHHHHHHHHHHHHHHH!!

Get thee behind me as I pass gas in your general direction you Capitalist swine!

GARRRRRRRRRRRRRRRRRRRRR!!!

You should keep this handy for posting warnings, souperman2 :-0


troll

Hank-
You are misinformed. Capitalism emerged first in the Italian States of the 15th century, and only really took of with the industrial revolution in Europe.
The concept of ownership of the means of production, with extraction of profit through the relation of user versus exchange value is a very recent economic relationship that will possibly soon end as it crashes into resource limitations that limit a system built on expansion for survival.
But it is a good narrative to believe, as it makes life simple---

I feel the biggest problem with the current model of capitalism is the legal concept of the corporation as an immortal person with all the rights of a real person and the money and power to escape the constraints a living person would confront. Also, the modern corporation has the legal obligation, articulated by the supreme court, to pursue profit for its shareholders above every other value. This construct of the corporation is, I believe, the source of most current economic problems.

Captialism works great in theory for the production and exchange of pure private goods, as long as there is a level playing field of many buyers and many sellers, no monopolies or monopsonies, and absolutely no externalities. Unfortunately, this does not describe any place that has ever actually existed in the real world. It could work well in a computer simulation, I suppose.

Capitalism is totally inappropriate and dysfunctional when applied to the provision of public goods, toll goods, or common pool goods. The quasi-religious application of capitalism to these sectors has a lot to do with a lot of the problems that have been discussed on this thread.

John--
Let's be blunt:
"We Have a big problem"

European petrol is heavily taxed. What do you think the price is before taxes?

Yeah - You know about another way to reduce consumption?

Reduced economic activity is a very effective means of reducing oil consumption.

Alan

While we might discuss what "economic activity" truly means, I could make a strong case that this does not apply in the US. The vast majority of the manufacturing base has been shipped abroad, and I would argue that manufacturing is true economic activity, but oil consumption has not decreased by any meaningful measure. Replacing manufacturing with burger flipping will not hold for long.

Perhaps "available funds" is a better indicator than "economic activity", and those have been procured to a large extent by borrowing and leveraging the past ten years. This society has for that period artificially separated both the individual's and society's economic productivity and the respective purchasing powers.

And that of course leads to harsh predictions for a future in which borrowing and leveraging are no longer possible. Where individual Americans will get the money from to spend on oil or much of anything else, is completely unclear. As is where society will find the funds to maintain its infrastructure.

where will we get the money? is our $10 trillion dollar economy going somewhere?

is our $10 trillion dollar economy going somewhere?

It very well might. If you've read anything by Ilargi, you'd know that that is a big concern of his.

Wealth doesn't just change hands. It can disappear, and the mortgage crisis is showing us that. And it could be just the tip of the iceberg.

And to repeat a great link from yesterday, here's an excellent primer from Market Ticker about where it can "go."

http://market-ticker.denninger.net/2007/12/year-in-review-and-look-ahead...

Ol' KD knows the score but he and NoThing hurt sensibilities around here. LOL.

No Thing? Who's that? And why will TOD sensibilities be hurt?

She posts on the Ticker board sometimes. Super smart. If you read around the board you figure it out.

How can I find No Thing's posts? Please give me a link. Thanks.

You sort of have to look around HERE

May have to register to access all areas.

Thank you.

"where will we get the money? is our $10 trillion dollar economy going somewhere?"

Bank of America is about to anounce layoffs amounting to (about) 10% of it's workforce. Every major homebuilder (Lennar, NVR, Hovnanian), you know, the business that has pretty much propelled the US economy with absolutely ridiculous, insane and unsustainble development/real estate prices over the past 5 years...post increasing losses every quarter. Chrysler is 'functionally bankrupt.'
A job with decent health insurance is an increasingly rare find, and the Ponzi scheme that is the Wall Street has developed a serious jones for other country's money(Singapore, Dubai, China) to inject large amounts of capital to keep the whole thing floating.

Gee, I wonder where our 10 trillion dollar economy could possibly go? By the way, I got a bridge in Minneapolis I could sell you for cheap. It's a little bit of a fixer upper, but I'm certain a man of your vision and insight could make a mint off it.

SubKommander Dred

so our GDP is going to contract 90%?

yup, and you'll be john 1,5

john

The economy stands at $13,675,129 million (IMF, retrieved 2007-06-17). So it's even better than you thought. Or is it?

The US borrows well over $2 billion a day from abroad, somewhere betwixt $800-900 billion per year. In 2005-6, refinancing of mortgages (MEW) provided close to $1 trillion annually in added consumer spending. We're already half way towards losing the difference between your $10 trillion and the real amount. And if we get back down to $10 trillion, there will no longer be a US economy in the sense that we know it in now. The growth system does not function in reverse. The remaining $2 trillion will be more than supplied by crashing stocks, derivatives, bank write-downs etc.

Note then, also, that you ignore what I wrote. The US doesn't make things anymore, it just buys them. But for that you need money, and to get the money, you have to make things.

Can it be simpler?

"The US doesn't make things anymore, it just buys them."

I know the US manufacturing base has been hollowed out and we need billions of dollars. we also have record exports. capitalism doesn't need growth. it needs a balance of growth and recession. growth and depression. boom and bust.

capitalism doesn't need growth.

The whole premise behind capitalism is that investment produces positive results. When investment produces negative results we see what has been happening here for the last eighteen weeks - credit markets completely frozen.

Given that energy will be increasingly dear all of those treasured "economic indicators" are just a fancy version of the chicken's entrails - don't read too much into them, as our consumption is going to forcibly shrink and any assumptions to the contrary are pure foolishness.

The only thing that counts now is consumable calories and usable BTUs. We need water, food, and shelter, in that exact order, and systems that don't support these three priorities in exactly that order are doomed.

"The whole premise behind capitalism is that investment produces positive results. When investment produces negative results we see what has been happening here for the last eighteen weeks - credit markets completely frozen."

I read over and over again about boom and bust dynamics. if something is unsustainable in a capitalist economy it corrects itself. we call those recession and depression. the housing market is too unsustainable and it's in a massive correction mode. as gas becomes more and more expensive using gas as we use it today will stop. this will be somewhat painful but it isn't the end of the world. we will find new ways of doing things. we use so much gas not because it's indispensible but because it's cheap. when it isn't cheap anymore we switch. example.

"Cotton is a good way to buy oil-- hear me out. Much apparel has been made from synthetics. Synthetics come from oil. So many textile makers are converting back to natural fibers because oil is at an all-time high. So if you want to buy oil, buy sugar [because it is easy to turn into ethanol], or buy cotton. What I'm buying right now is agriculture."

http://seekingalpha.com/article/57914-jim-rogers-cotton-is-a-good-way-to...

corrections, recessions and depressions are normal in capitalism. Lenin or Stalin, I forget which, thought the Great Depression was the end of captitalism. kondratiev proved otherwise. he proved boom bust was what capitalism was all about.

Around $100 per barrel wholesale for petrol, but the point is that the demand for petroleum products in Europe is still quite high, even at $300 per barrel plus at the retail level.

Could you please translate these number into estimates of the price of gasoline in todays dollars?