<DrumBeat: October 10, 2008 The Oil Drum What Career Should I Consider?>

121 comments on Resurgence of Risk - A Primer on the Develop(ed) Credit Crunch

Comments can no longer be added to this story.

| Show without comments | PDF version

ilargi on October 10, 2008 - 5:34pm Permalink | Subthread | Parent | Comments top

Nate,

You know I love you, something that doesn't go for all the drips you run with.

That said, I'd say it's quite clear how bang on Stoneleigh and me were from day one. And you, Wall Street affficionado, were not. Are we clear on that?

So today you re-run a year-old Stoneleigh piece, without even asking her for an opinion or update.

¿Que pasa, contigo?

She's all tickled and all, but I am not.

Is it so hard to pay dues where they are due? Yes, the Oil Drum has been wrong, consistently, and all along. Hey, just admit it and move on.

Nate, Stoneleigh just tells me to tell you I'm a retard.

Comments can no longer be added to this story.
Nate Hagens on October 10, 2008 - 6:10pm Permalink | Subthread | Parent | Comments top

Wrong about what amigo? Look at my last 20 posts - I've been as right as rain. Look at my predictions in the oil volatility post in December, look at in 2005 and 2006 I said we were seeing the end of growth forever, and last summer that credit crisis would swamp peak oil in near term, etc etc...

And 'theoildrum' has also been way ahead of the curve. We just haven't focused on finance, because it's not a finance site.

In any case, you've had a great call, and I have no idea how you find time to put up a post everyday as well as links, (and in your second language).

We are all on the same team - trying to steer this societal ship thats going over Niagara Falls. I think TOD is taking the longer shot - trying to change the social and political paradigm for everyone at its most central tenet - energy. TAE is more ground-up - trying to save individuals money from avoiding financial morass. Hopefully, we've both made a difference. One will likely never really know, so its the path that matters.

Comments can no longer be added to this story.
Stoneleigh on October 10, 2008 - 6:45pm Permalink | Subthread | Parent | Comments top

I was very pleased to see this post run today, and to have a chance to discuss its message again.

Comments can no longer be added to this story.
jewishfarmer on October 11, 2008 - 2:36pm Permalink | Subthread | Parent | Comments top

I certainly can't speak for Ilargi, but I do think that many people coming at this from a technical perspective, including some folks at TOD, have dramatically underestimated the degree to which we will be able to invest in major projects in the longer term - that is, there has been an undercurrent narrative of assuming that we would have the wealth to make major, innovative changes when the time came. That narrative, for example, was an undercurrent of the discussion of relocalization I participated in sometime back - the assumption was that those who advocated primarily low energy, low cost, low input solutions were primarily doing so because of an agenda, not because such solutions were necessary.

I get the sense from many people on this site and at others that while on one level folks knew the end of growth was coming, at the same time they assumed that there would be just enough growth for their pet projects and solutions. This, of course, is not universal, but the sheer sense of shock that the odds are against it is quite vast - again, I'm not speaking of anyone in particular, but I do think that quite a few people have suddenly got the "doomer" religion ;-), over this way, when they suddenly grasped that oops, maybe we weren't going to be doing whatever mitigation project they'd most like to see.

Sharon

Comments can no longer be added to this story.
BlueTwilight on October 12, 2008 - 4:47am Permalink | Subthread | Parent | Comments top

There was no guarantee the U.S. government (corporate oligarchy) would make all the wrong decisions. I certainly did not expect the Republicans to resort to corporate welfare for the Wall Street titans which likely crushed our financial ability to transition our economy away from crude oil. When arguing against the $700 billion bailout to my congressmen, I advocated spending the money on converting infrastructure to stimulate the economy. There is still a chance for a peak oil aware infrastructure project similar to the New Deal, but given the poor performance from the presidential candidates and congress, the odds seem decidedly against it.

Then again, the worst part of the subprime crisis is now, fourth quarter of 2008, which means the defaults and credit crunch will lessen next year. No one knows if the present financial crisis will be severe enough to plunge the world into a sustained depression. Some of the poorly managed companies that rely heavily on debt for day to day operations will be eliminated. I think it depends on how severely unemployment rises during the next 3 months. If it rises enough to cause widespread defaults on mortgages, including prime ones, then the world will be in a depression will little hope of anything other than low energy, low cost solutions.

Comments can no longer be added to this story.
Stoneleigh on October 12, 2008 - 10:45am Permalink | Subthread | Parent | Comments top

The subprime crisis is small beer compared to what's in store for Alt-A, and prime, lending. The resets on pay option ARMs in those much larger areas have hardly begun and won't end until about 2012. The credit crunch is set to get worse, not better, as the default rate on underlying assets steadily increases, or perhaps climbs in leaps and bounds as unemployment shoots up.

The new year should see the Wall Street crisis spill over on to Main Street with a vengeance, and not just in the US either. Much of Europe is teetering on the brink, suffering from far worse housing bubbles than the US (Germany being a notable exception), and Asia has been crashing as well. The financial system is too integrated to avoid contagion.

Comments can no longer be added to this story.
Ignatz on October 12, 2008 - 11:18am Permalink | Subthread | Parent | Comments top

I was very pleased to see this post run today, and to have a chance to discuss its message again.

Stoneleigh you are a calm eye of reason in a hurricane of self justification and recrimination. Good for you.

Comments can no longer be added to this story.
westexas on October 10, 2008 - 7:27pm Permalink | Subthread | Parent | Comments top

The thing that I didn't foresee, but which you guys did, was how widespread the collateral damage from the mortgage and overall financial meltdown would be--to the point that it is affecting food & energy production.

I have thought for a long time that the auto, housing, finance, etc. industries were toast, but I didn't think that food & energy would be collateral damage. To be precise regarding energy, I thought that the global decline in net oil exports would outpace the global decline in demand, which I still think will happen longer term, especially with the difficulty in getting energy projects funded.

Comments can no longer be added to this story.

121 comments on Resurgence of Risk - A Primer on the Develop(ed) Credit Crunch

Comments can no longer be added to this story.

| Show without comments | PDF version