-------------------------------------------------------- From: Jim Macgregor Date: Sun, 16 Oct 2005 07:04:59 EDT Subject: 'Peak Oil' To: •••@••.••• Richard, I've read David McGowan's article, Beware the 'Peak Oil' Agenda, several times and I'm sure most of your subscribers will also have given it considerable thought. I believe it very important that you air your own thoughts on this as you have based much of your projected scenario for the world as being due to a genuine Peak Oil situation. best wishes, jim --------- Hi Jim, Thanks for your observation. I do currently have a paragraph in my Apocalypse article that starts off: "Peak oil is real." But it turns out, as the investigation proceeds, that the reality or not of peak oil is irrelevant. In both the short term and the long term, this issue is trumped by other issues. In the short term, the issue is trumped by the fact that a decision has been made, by financial and oil elites, to put the squeeze on us - using oil shortages, and 'peak oil', as excuses. Any shortage that now exists is a result of human policy, not resource scarcity - policies about how many refineries to build, and how much oil to extract. See for example our posting of Oct 12: "Oil : Internal memos : intentional shortages" http://www.cyberjournal.org/cj/show_archives/?id=727&lists=newslog We are getting clear signals in the media that fuel prices will rise further, and that interest rates will be raised to ease the resulting inflation. An attack on Iran seems still to be in the works, and that is very likely to disrupt oil production, and even more shipping, in the region. That would bring another major spike in shortages and prices, most likely eclipsing what we've seen so far. Overall, I think we need to interpret these events as an engineered oil shock, like the one in '73. In that case, the most significant outcomes had to do with curtailment of economic growth, the beginning of the highly profitable third-world debt phenomenon, and the establishment of the petrodollar system - which salvaged the failing dollar and restored it to financial dominance. These were consequences, major consequences, in the realms of finance and geopolitics, and they were of more fundamental importance than the simple fact of increased oil industry profits. In our current situation we can expect similar consequences: reduced economic growth globally, major negative impact on third-world economies and debt burdens, and an even more dominant dollar. But besides those, we have something else to worry about this time around: an over-inflated global economy, as exemplified by excessive personal debt, and over-extended mortgages. On those occasions when I watch television, it seems that every other advert is some financial institution inviting us to go further into debt, to ride the housing bubble. An oil shock, plus an interest rate hike, plus a bubble economy, adds up to trouble, big trouble. There's a reason why economists use the term 'bubble' to refer to this kind of over-extended economy: once it stops expanding, it doesn't just calmly deflate - it bursts and collapses. In 1929 we had a bubble economy. Everything was expanding in the Roaring Twenties, and everyone was playing in the bubble stock market, on margin. Joseph Kennedy (JFK's father) remarked that he knew it was time to pull his money out of the market when his shoeshine boy started giving him investment tips. In that case, all it took was an interest rate hike to burst the bubble, bring down the house of cards, and lead the way to the Great Depression. Today we face a double whammy: 1973 + 1929. As oil prices and interest rates climb, consumer spending will go down, other prices will increase as suppliers and shippers pass on their own fuel increases, businesses will have to let people go due to both increased costs and reduced demand, unemployment will rise, and those on the margins will begin to default on their mortgages. As these houses begin to go on the market, the prices start to fall, and by then all the speculators will be scrambling to get out, glutting the market still further. Those who can still make their payments, but who would like to sell, are stymied: they owe more than their house is worth. They would need to come up with cash, to add to the sale price, in order to pay off their mortgage. The housing market is only one example of a bubble in our economy. There are the international financial markets, involving trillions of dollars, and based largely on speculative instruments, and there are the stock markets. The whole economy is one big bubble, held together by the anticipation of continued growth, and a major oil shock plus interest rate hike is bound to cause it to collapse. In the short term then, it is economic collapse we need to worry about, rather than peak oil. In the long run, peak oil is trumped by a broader issue: the general unsustainability of our civilization. Even if oil would flow forever, we can't keep living as we are as a society. We are abusing and over-using all of our resources: water supplies, soil, fishing stocks, etc., and we are poisoning our nest: with pollutants, genetically modified time bombs, greenhouse emissions, food additives, and more. Peak oil or no peak oil, either we transform our societies, or we face a major collapse of of our whole civilization, from many different causes. Earlier, I believed that this oil shock scenario was intended to manage the problem of imminent peak oil. Now I've come to the conclusion that the scenario is aimed at managing the bigger problem of unsustainability. From various indicators, including the fact that 'depopulation' is considered by U.S. planners to be high priority 'security' issue, it appears that the plan is to bring about a very severe economic collapse, one that will lead to large scale die-offs, primarily in the third world, and one that will lead to economic crisis in the rest of the world, enabling the regimentation of society. By reducing world population, and putting the survivors under an iron fist, ruling elites, it appears, will have the means to manage the collapse as they see fit, deciding who will make it through to the other side, and how resources will be allocated. An attack on Iran, which is likely to cause oil havoc, would be an ideal way to bring about such a severe collapse, and perhaps that may be the primary motivating factor for the impending attack. Motivation comes from expected outcomes, and apart from all-out nuclear war, economic collapse seems to be the most significant expected outcome of this particular war. For us, it seems to me, all of these circumstances indicate that what we need to be focusing on is the question of how we can gain the power to transform our societies. Peak oil or no peak oil, planned genocide or no planned genocide, if we don't gain that power we have disaster ahead of us, of one flavor or another. Waiting until things get worse will not make our task any easier. The sooner we face this question and start doing something about it, the better off we'll be. In that sense, we've long passed the point of diminishing returns as regards 'analyzing the problem'. All we really need to know is that our societies are unsustainable, and that this problem cannot be productively addressed within the context of our current political systems. After that, we can find only redundant details in further analysis. rkm --- For those of you who continue to have an academic interest in the narrow question of peak oil, here are some articles about abiotic oil: http://www.cyberjournal.org/cj/show_archives/?id=730&lists=newslog 13 Oct - * David McGowan : Beware the Peak Oil Agenda * http://www.cyberjournal.org/cj/show_archives/?id=768&lists=newslog 16 Oct - Abiotic oil : hydrocarbons in ancient rocks http://www.cyberjournal.org/cj/show_archives/?id=766&lists=newslog 16 Oct - Abiotic oil : The mystery of Eugene island 330 http://www.cyberjournal.org/cj/show_archives/?id=764&lists=newslog 16 Oct - Abiotic oil : a dissenting view http://www.cyberjournal.org/cj/show_archives/?id=765&lists=newslog 16 Oct - Abiotic oil : a scientific inquiry http://www.cyberjournal.org/cj/show_archives/?id=767&lists=newslog 16 Oct - Abiotic oil : Col. Prouty : primordial oil? http://www.cyberjournal.org/cj/show_archives/?id=729&lists=newslog 13 Oct - Jerry Mazza : Abiotic oil -- http://cyberjournal.org "Apocalypse Now and the Brave New World" http://www.cyberjournal.org/cj/rkm/Apocalypse_and_NWO.html List archives: http://cyberjournal.org/cj/show_archives/?lists=newslog Subscribe to low-traffic list: •••@••.•••
