On Apr 26, 10:33=A0pm, The Trucker <mik...@[EMAIL PROTECTED]
> wrote:
> On Sat, 26 Apr 2008 07:18:08 -0700,zzbunkerwrote:
> > On Apr 21, 6:23=A0am, "V-for-Vendicar"
> > <Just...@[EMAIL PROTECTED]
> wrote:
> >> "(David P.)" <imb...@[EMAIL PROTECTED]
> wrote in message
>
>
>>news:62620a3d-5dd7-44d1-97ef-31e53d9790f0@[EMAIL PROTECTED]
>
> >> Op-Ed Columnist
> >> Running Out of Planet to Exploit
>
> >> By PAUL KRUGMAN
> >> Published: April 21, 2008
>
> >> Nine years ago The Economist ran a big
> >> story on oil, which was then selling for
> >> $10 a barrel. The magazine warned that
> >> this might not last. Instead, it suggested,
> >> oil might well fall to $5 a barrel.
>
> > =A0 But the only truely interesting question about oil and economics
> > =A0 is why do economists and speculators even spectulate
> > =A0 about the future of idiot fossil fuels, partulcuarly oil anymore.
>
> Because they are actually speculating on the demise of fiat money.
>
> > =A0 Since the intelligent money in science, engineering, and
> > technology,
> > =A0 pulled out of the fossil fuels markets almost 60 years ago now.
>
> They lost.
It makes no difference that we lost a moron war to morons.
Since we're going to just keep building more AI, Optical Computers,
laser disks, non-****ead computer printers, nanotech, GPS
extensions,
nuclear reactors, PV cells, electric mowers, robots, and laser-
guided bombs
for the Wal-Mart morons.
>
> > =A0 Partuclary since the only thing idiot magazine publishers
> > =A0 even seem to know about oil is the Wal-Mart warehousing price,
> > =A0 rather than the cost.
>
> At last! =A0A valid point.
>
>
>
>
>
>
>
> >> In any case, The Economist asserted,
> >> the world faced "the prospect of cheap,
> >> plentiful oil for the foreseeable future."
>
> >> Last week, oil hit $117.
>
> >> It's not just oil that has defied the com-
> >> placency of a few years back. Food
> >> prices have also soared, as have the
> >> prices of basic metals. And the global
> >> surge in commodity prices is reviving
> >> a question we haven't heard much since
> >> the 1970s: Will limited supplies of natural
> >> resources pose an obstacle to future
> >> world economic growth?
>
> (snicker) =A0Why would anyone attempt to measure value in dollars?
=A0This=
is
> not to say that population growth has not increased real costs. =A0But
the=
> use of the word "real" by latter day neoconomists is inappropriate.
>
> >> How you answer this question depends
> >> largely on what you believe is driving the
> >> rise in resource prices. Broadly speaking,
> >> there are three competing views.
>
> >> The first is that it's mainly speculation -
> >> that investors, looking for high returns at
> >> a time of low interest rates, have piled
> >> into commodity futures, driving up prices.
> >> On this view, someday soon the bubble
> >> will burst and high resource prices will
> >> go the way of Pets.com.
>
> There is some actual some reality to this point.
>
> >> The second view is that soaring resource
> >> prices do, in fact, have a basis in funda-
> >> mentals - especially rapidly growing
> >> demand from newly meat-eating, car-
> >> driving Chinese - but that given time
> >> we'll drill more wells, plant more acres,
> >> and increased supply will push prices
> >> right back down again.
>
> This is not a reality in that there are real limits to the environment
> past which population cannot rise without destroying the ecosystem. =A0I
d=
o
> not imply that we are there yet, but we are probably getting close.
>
> >> The third view is that the era of cheap
> >> resources is over for good - that we're
> >> running out of oil, running out of land to
> >> expand food production and generally
> >> running out of planet to exploit.
>
> Good points all.
>
> >> I find myself somewhere between the
> >> second and third views.
>
> Then you have missed the primary cause of price escalations in that the
> demise of fiat currencies is that primary. =A0The dollar leads this
demise=
> but the other currencies must follow or their economies will collapse.
> All the REAL stuff is therefore much higher priced when measured in fiat
> currencies. =A0At the same time the cost of labor has declined keeping
> the price of PRODUCED goods lower than would have otherwise been the
case.=
> These are the real reasons for the apparent and relative increases in
> commodity prices.
>
> >> There are some very smart people -
> >> not least, George Soros - who believe
> >> that we're in a commodities bubble
> >> (although Mr. Soros says that the bubble
> >> is still in its "growth phase"). My problem
> >> with this view, however, is this:
> >> Where are the inventories?
>
> You are discussing the smaller of the contributors to perceived price
> escalation of commodities.
>
> >> Normally, speculation drives up commodity
> >> prices by promoting hoarding. Yet there's
> >> no sign of resource hoarding in the data:
> >> inventories of food and metals are at or
> >> near historic lows, while oil inventories
> >> are only normal.
>
> The amount of fiat money in the world system has grown enormously.
=A0Why =
do
> you not understand that the value of that money has declined
dramatically
> and is expected to decline even further. =A0This decline and the
speculati=
on
> on further decline is primarily =A0what you are seeing when you look at
th=
e
> apparent rise in commodity prices?
>
> >> The best argument for the second view,
> >> that the resource crunch is real but tem-
> >> ****ary, is the strong resemblance between
> >> what we're seeing now and the resource
> >> crisis of the 1970s.
>
> What "resource crises of the 1970's"? =A0there was massive inflation in
th=
e
> 70's; massive devaluation of the value of dollars especially when
measured=
> against oil and land.
>
> >> What Americans mostly remember about
> >> the 1970s are soaring oil prices and lines
> >> at gas stations. But there was also a
> >> severe global food crisis, which caused
> >> a lot of pain at the supermarket checkout
> >> line - I remember 1974 as the year of
> >> Hamburger Helper - and, much more
> >> im****tant, helped cause devastating
> >> famines in poorer countries.
>
> Did you bother to look at the INFLATION of the 70's? =A0Did you consider
t=
he
> falling value of the dollar in the 70's and the im****t duties?
>
> >> In retrospect, the commodity boom of
> >> 1972-75 was probably the result of rapid
> >> world economic growth that outpaced
> >> supplies, combined with the effects of bad
> >> weather and Middle Eastern conflict.
>
> Horse****. =A0It was due to inflation.
>
> >> Eventually, the bad luck came to an end,
> >> new land was placed under cultivation,
> >> new sources of oil were found in the
> >> Gulf of Mexico and the North Sea, and
> >> resources got cheap again.
>
> Nope. =A0Paul Volcker destroyed the economy of the Unites States so as
to
> kill the inflation dragon and restore the value of the "God Almighty
> Dollar".
>
> >> But this time may be different: concerns
> >> about what happens when an ever-growing
> >> world economy pushes up against the limits
> >> of a finite planet ring truer now than they
> >> did in the 1970s.
>
> That is the conclusion of "climate change" folks and it is not all
wrong.
>
> >> For one thing, I don't expect growth in
> >> China to slow sharply anytime soon.
> >> That's a big contrast with what happened
> >> in the 1970s, when growth in Japan and
> >> Europe, the emerging economies of the
> >> time, down****fted - and thereby took a
> >> lot of pressure off the world's resources.
>
> Those economies "down****fted" because the American middle class was
busted=
> by lack of employment op****tunities. =A0The producing countries had less
> market for their produce.
>
>
>
>
>
> >> Meanwhile, resources are getting harder
> >> to find. Big oil discoveries, in particular,
> >> have become few and far between, and
> >> in the last few years oil production from
> >> new sources has been barely enough to
> >> offset declining production from
> >> established sources.
>
> >> And the bad weather hitting agricultural
> >> production this time is starting to look
> >> more fundamental and permanent than
> >> El Ni=F1o and La Ni=F1a, which disrupted
> >> crops 35 years ago. Australia, in particular,
> >> is now in the 10th year of a drought that
> >> looks more and more like a long-term
> >> manifestation of climate change.
>
> >> Suppose that we really are running up
> >> against global limits. What does it mean?
>
> >> Even if it turns out that we're really at or
> >> near peak world oil production, that
> >> doesn't mean that one day we'll say,
> >> "Oh my God! We just ran out of oil!" and
> >> watch civilization collapse into "Mad Max"
> >> anarchy.
>
> >> But rich countries will face steady
> >> pressure on their economies from rising
> >> resource prices, making it harder to raise
> >> their standard of living. And some poor
> >> countries will find themselves living
> >> dangerously close to the edge - or over it.
>
> >> Don't look now, but the good times may
> >> have just stopped rolling.
>
> Not a bad conclusion considering all the misunderstandings.
>
> --
> "I know no safe depository of the ultimate powers
> of society but the people themselves; and
> if we think them not enlightened enough to
> exercise their control with a wholesome
> discretion, the remedy is not to take it from
> them, but to inform their discretion by
> education." - Thomas Jeffersonhttp://GreaterVoice.org/extend-
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