Search The Oil Drum with Google
Recently on TOD:World
TOD:Local
- Streets: Utilitarian Corridors or Livable Public Space
- Summer Streets a Success!
- Plan for Hydro-Fracture Drilling for Unconventional Natural Gas in Upstate New York
TOD:Europe
- Oilwatch Monthly - November 2008
- The 2008 IEA WEO - Production Decline Rates
- The EU Strategic Energy Review: maybe not so depressing after all
TOD:Canada
- The Round-Up: October 24, 2008
- Compressed Air Energy Storage - How viable is it?
- Oil Megaproject Update (July 2008)
TOD:ANZ
Blogroll
Energy Sites
- The Coming Global Oil Crisis
- Die Off
- Dry Dipstick
- Energy Bulletin
- From the Wilderness
- Life After the Oil Crash
- Peak Oil Crisis
- Peak Oil News and Message Boards
- Powerswitch
- Rigzone
- Matthew Simmons
- Wolf at the Door
Environment & Sustainability Sites
- The Daily Green
- EcoGeek
- Eco Street
- Green Car Congress
- Green Options
- green.alltop.com
- Gristmill
- RealClimate
- Sustainablog
- Treehugger
- WorldChanging
Blogs
- The Big Picture
- Casaubon's Book
- Cleantech Blog
- Clusterf
k Nation (Jim Kunstler) - The Cost of Energy
- David Strahan
- The Energy Blog
- Entropy Production
- European Tribune
- GraphOilology
- jeffvail.net
- Mobjectivist
- Peak Energy (Australia)
- Peak Energy (USA)
- R-Squared
- Resource Insights
Finance & Economics Blogs
- Calculated Risk
- Ecological Economics
- Econbrowser
- Environmental Economics
- Infectious Greed
- The Mess That Greenspan Made
- Mish's Global Economic Trend Analysis
Organizations
“Where ideas are concerned, America can be counted on to do one of two things: take a good idea and run it completely into the ground, or take a bad idea and run it completely into the ground.”
—George Carlin
User login
Contact
- Content: editors at theoildrum dot com
- Tech support: support at theoildrum dot com
Personnel
- Editors: Prof. Goose, Heading Out, Stuart Staniford, Nate Hagens
- DrumBeat Editor: Leanan
- Contributors: ace, Engineer-Poet, Gail the Actuary, jeffvail, JoulesBurn, Khebab, Robert Rapier
- TOD:Local: Glenn
- TOD:Europe: Chris Vernon, Euan Mearns, Francois Cellier, Jerome a Paris, Luís de Sousa, Rembrandt, Rune Likvern, Ugo Bardi
- TOD:Canada: benk, Libelle
- TOD:ANZ: Big Gav, Phil Hart, aeldric
- Technician: Super G
License
This work is licensed under a Creative Commons Attribution-Share Alike 3.0 United States License.
GAIA Host Collective
It is interesting that Western Canada, regarding oil, is in Export Land, while Eastern Canada is in Import Land.
Of course, we see this on a regional, but less pronounced, basis in the US. For example, portions of Texas are still net oil exporters but I think that Texas itself is a net oil importer.
In any case, what we are fundamentally seeing is Produce or Perish (or Pilfer). The discretionary side of the North American economy is going to just get crushed.
Just what is discretionary? Peoples decisions about how to spend scarce cash aren't always the wisest. For instance producers of the kind of ethanol you drink might do quite well.
I certainly prefer to drink ethanol than to burn it in a vehicle. Burning it seems like such a waste of good libations!
We just had 1 million fervent supporters of the biological consumption of ethanol visiting us :-)
Happy (?) Ash Wednesday, when MANY regret their sins,
Alan
Hello AlanfromBigEasy,
Did you notice any partygoers shouting out Peakoil when their beverage of choice hit half-empty? I am constantly trying to promote this as a new cultural tradition.
Bob Shaw in Phx,Az Are Humans Smarter than Yeast?
Bob,
I like it!
I will start a new tradition this very evening!
THXS SGAGE!
My lawyer's advice to a friend thinking of going into business in a small retail venture was: Sell chocolates. In hard times when money is short, small luxuries are all people can afford. He said a chocolate shop has never gone broke in a recession.
That sounds like a GOOD idea. And not just chocolates, but anything tasty. Nutty, savory (salty) anything that's a little treat, will do well. And extra points if it's actually good for you like good chocolates are. You could grow nuts or get them locally and make them into sweets. It's a very good business plan.
Isaac Asimov's family ran a candy store when he was a kid, and this was in the Depression. It appeared to provide well for them, and provide the basic framework for Isaac and his siblings to get into colleges.
I know from personal experience, as Ebay sales were sinking then tanking, and as the US economy has gone down, I've consistantly been able to do OK at swapmeets with an "Everything's a dollar" method. I finally realized I was coming out better selling 10 of something for $1 each than selling those 10 things for $9.95 on ThiefBay and losing $3 in fees.
A dollar now is like the old-time nickel or dime, no one thinks about it.
I also used to know a swapmeeter who'd get nuts and bolts and fasteners and stuff, cheap or free, organize them in his house all week, then on the weekend hit the swaps. He'd drive up in his little pickup truck, and unfold a setup that took up something like 5 spaces, and have bins and bins and bins of odds and ends, 2 for $1 or $1 each or whatever, everything was cheap. I think his most expensive item would be $3. I'd come by and dump $100 or more on his first thing, picking up RF connectors and stuff. Guys could not stay away, he had tons of stuff, and it was all cheap. He said he did even better at the classic car shows. The guy worked out of his house, only had to go out and sell on the weekends, and made at the very least $1000 on a weekend. Often double that I'm sure. The guy's a genius.
Off-shore Texas is "Export Land", On-shore Texas (despite your best efforts Jeffrey) is "Import Land". Import Land is bigger than Export Land AFAIK.
Most Texans are unaware that Texas does not produce enough oil to keep the freeways (and tollways) of Houston, Dallas, San Antonio, Austin, El Paso, Ft. Worth, Amarillo, Waco, Corpus Christi, etc. busy.
Best Hopes for Urban Rail in Texas,
Alan
Consistent with your longstanding "produce or perish" theme...
US Service Sector in Recession
January 2008 Non-Manufacturing ISM Report On Business
The service economy is most of our economy today. It appears to have just collapsed.
The hyperbole is not especially helpful. Yes, the service sector appears to be in contraction, but to call this "collapse" is rather suspect.
It's a 23% decline, from 54.4 to 41.9. If it had gone from 54.4 to 49.9, it would be appropriate to say "Yes, the service sector appears to be in contraction..."
We're talking about what Bloomberg has estimated is 90% of the U.S. economy.
"The survey results were downright disastrous," said Stephen Stanley, chief US economist at RBS Greenwich Capital.
I hate it when people nag others to express themselves only in optimistic terms. I agree there's reason for hope, but if someone doesn't agree with a pessimist's view, why not simply put up the alternate view and explain the reasons for it, rather than seeking to enforce a happy-talk code of conduct?
From the link, I can't determine what a decline from 54.4% to 41.9% means. The original gives it as a percentage, but of what? It doesn't say. So on its face it's just yet another of a bazillion trumped-up proprietary magic numbers that attract a bazillion press releases that ultimately clog up the "internets" with a bazillion pleas for Congresscritters to hose the taxpayer by voting up subsidies for their special-interest pets. I can't tell how much it amplifies real-world changes. I can't tell what real-world changes those might be. I can't even find a long-term time series by which to guess how volatile it is (maybe I didn't look hard enough or it's squirreled away behind a paywall as if it were a CERA report; those guys gotta make money somehow.)
Now, if we had suddenly lost 23% of all service jobs, then that would be so obvious that none of the ever-popular conspiracy methodologies rehashed for the umpteenth time on today's Drumbeat could conceivably hide it. For one thing, I'd have to take a long detour to get around the line at the local unemployment office. So did we lose 23% of anything that matters? Did we lose 23% of anything at all? What would the world look like at a reading of 0%? 100%? Dunno. It might as well be a random number. This is not a matter of "a happy-talk code of conduct", there's plenty of unhappy talk here most days. It's simply a matter an apparently empty article.
If you can state or point to better information on what it might mean, please do. Meanwhile...???
The ISM is a survey of manufacturing executives on their 'feelings' about the manufacturing sector. Since their 'feelings' have more validity than yours or mine regarding the manufacturing sector, the market occasionally takes notice of this number. (It used to not move market at all - the economic numbers that move the market change over time - this is another one of those '1,000 post card' survey type numbers)
The Institute for Supply Management is not a johnny-come-lately to the data scene. If you had read the associated links you would have discovered that the scale works like this - 50.0 is a flat economy. Anything over 50.0 is a growing economy. Anything under 50.0 is a contracting economy. The ISM has kept detailed records using this format for decades and is thus well qualified to determine what constitutes "growth" in the service economy and what constitutes "contraction".
Further, the ISM's report was cited as one of the main drivers in yesterday's 370 point drop of the DOW and the 1339 point (5.40%) drop in the Chinese stock market last night. Apparently some people give the report more weight than you do.
Furthermore, rather than ranting, you could have read the ISM Report FAQ which would have probably answered many of your questions. ISM (formerly PMI) reports go clear back to 1948, if you care to dig in the archives.
This is a pretty serious contraction, especially if next month's report continues the trend.
Or, you can continue to pretend that all's well with the economy. If that's what you wish to do, be my guest.
Hello, GZ, thanks for the link. Now that I know what it is, I still haven't found a link to it on their cluttered home page, although I found several other FAQs hidden under the mouse-over covers. Maybe it's there somewhere. Nor have I found an identifiable link to it on their "site map", nor in the two originally linked pages. Nor do I see any links to "archives" in any of those places. (Would I need a paid-up membership?)
Oh, and the original ISM page delves into the subject matter of the various indices, but does not state the methodology used to produce the individual numbers. Now that I have this particular FAQ, I see it's basically all a touchy-feelie thing. It doesn't really mean "50 is a flat economy", only that the number of respondents saying "better" equalled the number saying "worse", i.e. their net response-to-survey-quality guess is "flat". That could well slosh all over the map with very small changes in the economy, as it doesn't seem to say that the result is weighted according to the fraction of the economy a respondent manages supplies for, nor even according to the severity of the change said respondent sees through his or her own proprietary window.
This all seems fairly consistent with Nate's remark, "...this is another one of those '1,000 post card' survey type numbers", so I'm inclined to go with that. It's probably better than asking 1,000 bloggers, but it's probably not all that great.
Which BTW has no connection to what I might think the economy might do. Among other things, I think there are more than enough (figurative) helicopters available to guarantee stagflation. And I think that will reinforce the powerful lesson Baby Boomers learned in the 1970s: saving is a chump's game because the government will confiscate much of what you save. And I think it will teach that lesson well to two more generations. And I think that will be very, very bad for raising the enormous investment apparently needed to secure even very modest supplies of non fossil-fuel energy. Then again, I could be wrong.
PaulS
'I think there are more than enough (figurative) helicopters available to guarantee stagflation. And I think that will reinforce the powerful lesson Baby Boomers learned in the 1970s: saving is a chump's game because the government will confiscate much of what you save. And I think it will teach that lesson well to two more generations.'
we don't save due to compulsive spending which is psychological. & yes it would be confiscated but we've been trained too well & as nate says spending gooses our biochemicals.
i agree the helicopters may work a time or 2[mostly a psychological trick as u seem to point out] but if the upcoming decline begins in a few years or less the psychology will change due to reality & the ponsi schema is up. & it won't take generations.
my point is lots of the economy at this point seems psychological. maybe u are right about the research quality of the the study but it is the right arena.
I think appears is the operative word. On NPR yesterday it was explained that the index is psychological in that it measures how much new supply, i.e. paper, pens, pencils, ladders, toilets, etc., purchasing managers will buy to meet expected upcoming orders.
Apparently because purchasers can quickly change their mind it doesn't mean a whole lot but in print it has a solid psychological hit.
We'll see.
Absolutely true, Ammond. But if those psychological aspects turn into real actions (delayed or canceled orders, etc.) then the hit becomes real. Part of what the index measures is what business people are planning to do (purchases, hirings/layoffs) and what they believe they are seeing happen with their businesses.
I found this helpful; IMS and employment:
http://krugman.blogs.nytimes.com/2008/02/05/how-bad-is-that-ism-report/