Requiem For The Oil Drum

[jharkin]

Part of my PO skepticism has to do with powerful negative (rather than positive) feedbacks on price. Back in the day, the Drummers assumed the price could go to $200, $400, $1000/barrel, and never come back. The 'problem' is that at $100 tar sands oil, ultra deepwater and oil shales all look like a good business proposition with existing tech. I.e. at sustained prices of $100 they will all be developed at a large scale, as we have seen. At $150-$200 coal to liquids and gas to liquids look like stupid easy ways to make $$. IOW, At $200 there is almost an unlimited amount of (synthetic) oil to be had from converting coal. From an (existing) tech perspective, sustained prices above $150-$200 appear effectively impossible. Here 'sustained' means the 2-4 years required to build a lot of plants.

And then learning curve makes all this (existing) tech cheaper. Maybe the $100 shale oil and tar sands and ultra deepwater can, with some development make money at half that in 5 more years of operation/learning/amortization? Then the current demand/supply equilibrium price could drop to that level...If we went for Coal to Oil in 2025 or 2035 at $150 (current $$), maybe after a few years, it could drop back to 75...

But the thing is, oil didn't top out at 150 due to all these miracles of technology. It topped out due to the reason you already mentioned - supply & demand. $150 oil was unaffordable to a large enough part of the population it cratered the economy. Over extended people had to chose gas or the mortgage, defaulted and then we all saw the results. Lots of people out of work means a lot of people who can't afford gas, reducing demand back down to levels that $100 oil tech can meet.


Problem with oil is that supply/demand curve is backward. When you are producing widgets, the more you make the lower the unit cost. Oil is opposite, the more we produce the more expensive it gets. Our economy isn't built to deal with that.


Economy recovers, demand up, price goes up, crash, rinse and repeat. Does anyone really thing we are in a genuine recovery? That is anyone but stockbrokers?

 

[btuser]

Because our currency is innately tied to oil Americans have a tilted perspective to the petrodollar.

 

[woodgeek]

But the thing is, oil didn't top out at 150 due to all these miracles of technology. It topped out due to the reason you already mentioned - supply & demand. $150 oil was unaffordable to a large enough part of the population it cratered the economy. Over extended people had to chose gas or the mortgage, defaulted and then we all saw the results. Lots of people out of work means a lot of people who can't afford gas, reducing demand back down to levels that $100 oil tech can meet.

In a lot of developing countries, oil is subsidized at the consumer level, and those folks didn't see the spike....it just showed up on the govt balance sheet. In Euroland, the price was already so high from taxes, and consumption lower, that the smaller % price increase for the crude price was not a 'shock'. A lot of other countries are producers, and made out. IMO, the US was the only big country that got gobsmacked by that price spike....we the people were left wide open to that threat as a result of the peculiar way we have dealt with oil/energy politically and vis a vis urban development, car fleet choices, etc. for the last 30 years. Blame Reagan.

And while I agree about the oil trigger, the real estate bubble was bigger than the oil deficit....all that HELOC money didn't go to paying the oil man.

Problem with oil is that supply/demand curve is backward. When you are producing widgets, the more you make the lower the unit cost. Oil is opposite, the more we produce the more expensive it gets. Our economy isn't built to deal with that.

Actually price going up with volume is the **default case** for any product in any economic text book. You are conflating that with learning curve, which says that over longer terms, new technology will get **slowly** cheaper. While everyone knows Moore's Law, it is a great foolishness of our age to expect it to apply to cars, chicken eggs, college degrees or penicillin. This is the crux of my point. Supply/demand does cause price spikes from market dynamics, and mismatch between supply infrastructure and new demands (e.g. oil equipment from the 80s vintage and new Chinese oil demand in the 2000s). But investment in new equipment/tech is the negative feedback, that tends to damp out those oscillations, and then bring the price back down gradually, along a tech-limited curve (which is hard to predict).

Economy recovers, demand up, price goes up, crash, rinse and repeat. Does anyone really thing we are in a genuine recovery? That is anyone but stockbrokers?

That is the narrative these days, BUT on the price front it seems prices have been remarkable **stable** for the last 4 years around $100. I don't think most would have predicted that back in 2009. When heating oil hit $5 back in 2008, I would not have believed it would be under $4 for 5 more years afterwards. Of course, it is the new resources coming on line (at production costs closer to $100, setting a short term floor price), and the Saudi's are regulating the market again. They are fine with the new spendy resources coming on line, but don't want too much demand destruction (and indeed, Ford pickups are again the best sellers in the US market).

And yeah, there IS a recovery, it is just leaving a LOT of folks behind. US exports and GDP per capita are above 2008 levels, and making all time highs, corrected for inflation (that's not just stockbrokers). The folks being left behind are the less educated, the poorer, and folks mostly over 50 whose jobs have been replaced by new technology. The rich, the young with 'good' college degrees, and everyone else whose jobs are not automatable are as a group doing just fine.

IMO, people are happiest when they are getting raises regularly and that has not been happening. Economists think employment is only now getting tight enough that we will start to see 'happy time' incremental raises. We'll see. 'Financial doom' and talking down the economy actually feeds into wage suppression. Folks get raises when they demand them, and folks haven't been doing that.

 

[jharkin]

In a lot of developing countries, oil is subsidized at the consumer level, and those folks didn't see the spike....it just showed up on the govt balance sheet. In Euroland, the price was already so high from taxes, and consumption lower, that the smaller % price increase for the crude price was not a 'shock'. A lot of other countries are producers, and made out. IMO, the US was the only big country that got gobsmacked by that price spike....we the people were left wide open to that threat as a result of the peculiar way we have dealt with oil/energy politically and vis a vis urban development, car fleet choices, etc. for the last 30 years. Blame Reagan.

And while I agree about the oil trigger, the real estate bubble was bigger than the oil deficit....all that HELOC money didn't go to paying the oil man.

I dont disagree it hit us worse then elsewhere, but its a stretch to say hte rest of the world was immune. When I was in India in March I heard a lot of complaining about the cost of living. There where fuel riots over there last year over gasoline prices.

Dont forget that the price of crude effects the cost of nearly everything around us. Shipping, food, raw materials for ht emanufactured goods we buy. You dont have to be a direct consumer of unsubsized gasoline to feel the effects.

Actually price going up with volume is the **default case** for any product in any economic text book. You are conflating that with learning curve, which says that over longer terms, new technology will get **slowly** cheaper. While everyone knows Moore's Law, it is a great foolishness of our age to expect it to apply to cars, chicken eggs, college degrees or penicillin. This is the crux of my point. Supply/demand does cause price spikes from market dynamics, and mismatch between supply infrastructure and new demands (e.g. oil equipment from the 80s vintage and new Chinese oil demand in the 2000s). But investment in new equipment/tech is the negative feedback, that tends to damp out those oscillations, and then bring the price back down gradually, along a tech-limited curve (which is hard to predict).

Hmmm well I will admit I am no economist. Im an engineer by education and my only real exposure to econ was engineering economics courses where we analyzed how per unit cost goes down with volume in manufacturing due to the fact that the more units you build the more your R&D and capital costs get amortized, and eventually you get other benefits of economy of scale like discounts for volume orders of raw materials, etc. Im pretty sure this holds true for most manufactured goods. Perfect example just follow the car industy and introduction of new cars like the volt and other hybrids, there is always a break even point in sales they have to reach to start turning a profit.

And yeah, there IS a recovery, it is just leaving a LOT of folks behind. US exports and GDP per capita are above 2008 levels, and making all time highs, corrected for inflation (that's not just stockbrokers). The folks being left behind are the less educated, the poorer, and folks mostly over 50 whose jobs have been replaced by new technology. The rich, the young with 'good' college degrees, and everyone else whose jobs are not automatable are as a group doing just fine.

IMO, people are happiest when they are getting raises regularly and that has not been happening. Economists think employment is only now getting tight enough that we will start to see 'happy time' incremental raises. We'll see. 'Financial doom' and talking down the economy actually feeds into wage suppression. Folks get raises when they demand them, and folks haven't been doing that.

I'll wait and see. I still see a lot of record profits riding more on cost cutting than real growth. I also see lots of folks loosing there jobs to off shoring - and its not just factory automation. Its everything from engineers to computer programmers to lawyers. Pretty much the only thing truly immune are direct service jobs.

Maybe its just the high cost area I live in is a tougher market than most that I dont see this magic recovery. Sure its there in my 401k statement but nowhere else really - ask me again in 30 years if that made any real difference in my life.

 

[woodgeek]

Hmmm well I will admit I am no economist. Im an engineer by education and my only real exposure to econ was engineering economics courses where we analyzed how per unit cost goes down with volume in manufacturing due to the fact that the more units you build the more your R&D and capital costs get amortized, and eventually you get other benefits of economy of scale like discounts for volume orders of raw materials, etc. Im pretty sure this holds true for most manufactured goods. Perfect example just follow the car industy and introduction of new cars like the volt and other hybrids, there is always a break even point in sales they have to reach to start turning a profit.

Cost per unit goes down due to 'economies of scale', and goes down over time due to learning curve. Your engineering profs were correct. But plant construction (and new tech development) are all on too long a timescale to set prices in the market **today** when my product flies off the shelves. That's why economists always draw their supply/demand curves like this, curving upward with supply (higher unit prices):

Caption: The price P of a product is determined by a balance between production at each price (supply S) and the desires of those with purchasing power at each price (demand D). The diagram shows a positive shift in demand from D1 to D2, resulting in an increase in price (P) and quantity sold (Q) of the product.

As an engineer, imagine that if we wanted to make more product NOW, we would have to pay our folks overtime pay, scramble to find new raw material suppliers that might be more expensive, shipped from further away, or gouging me in my desperation, etc.

 

[woodgeek]

I dont disagree it hit us worse then elsewhere, but its a stretch to say hte rest of the world was immune. When I was in India in March I heard a lot of complaining about the cost of living. There where fuel riots over there last year over gasoline prices.

Dont forget that the price of crude effects the cost of nearly everything around us. Shipping, food, raw materials for ht emanufactured goods we buy. You dont have to be a direct consumer of unsubsized gasoline to feel the effects.

Yeah, India is def a big loser from expensive oil too. Lots of imported oil, low GDP per capita and not a lot of US dollars to swap for oil (unlike China). The rupee has also been tanking slowly, and fast more recently which is NOT a good development.

As for the cost thing....I would argue that cheap oil was such a tiny fraction of costs back in the day, $100 has not lead to an 'inflation shock' in other goods.

Inflation from 2003 to 2008 was 17%, but from 2008 to 2013 just 8%. So, maybe you could say the oil price spike from 2003 to 2008 lead to (17-8)/5 = 1.8% extra inflation per year. Hardly a shock. And of course, we are comparing inflation in a 'happy time' when everyone is getting raises, to a 'recession', when everyone is hunkered down. So I would argue that the above inflation difference is more likely that, and that there was no obvious net inflation signal from the end of cheap oil (in the US) 2003-2008. So, while you are quoting PO dogma re PO-induced hyperinflation, where is the evidence?

Of course, there was a food price spike that is credited with the Arab Spring, etc, and PO types like to say that was all the price of oil....but how much was food demand driven (e.g. more demand for food/meat in China), reduced food/feed supply due to corn ethanol in the US, etc?

 

[Grisu]

Inflation is only part of the problem of the 2008 downturn. CPI-U rates were higher than 2% for most of time during 03 to 08 but you have to follow the money to understand why people started defaulting on their mortgages:

That's the US trade deficit which doubled from 03 to 08 from $300 billion to $600 billion per year. That means dollar get exported to other countries and don't come back. Hence, not enough money left to pay back debts. Since oil is a big reason for our trade deficit (~3 billion barrels per year imported at $100 per barrel = $300 billion) the rise in oil prices precipitated the housing crisis.

And why do prices not increase much right now? Remember, money is created through increasing debt. No new debt, no additional money, no pressure on prices:

See what happened in 2008?

 

[Grisu]

In related news: Today we "celebrate" Earth Overshoot Day!

"August 20 is Earth Overshoot Day, the approximate date humanity’s annual demand on nature exceeds what Earth can renew in a year. In just 7 months and 20 days, we have demanded a level of ecological resources and services — from food and raw materials to sequestering carbon dioxide from fossil fuel emissions — equivalent to what Earth can regenerate for all of 2013....We will maintain our ecological deficit by depleting stocks of fish, trees and other resources, and accumulating waste such as carbon dioxide in the atmosphere and oceans."

http://www.footprintnetwork.org/en/index.php/GFN/page/earth_overshoot_day/

Just too bad that nature's resources are not a fiat currency with unlimited line of credit.

 

[woodgeek]

Inflation is only part of the problem of the 2008 downturn. CPI-U rates were higher than 2% for most of time during 03 to 08 but you have to follow the money to understand why people started defaulting on their mortgages:

That's the US trade deficit which doubled from 03 to 08 from $300 billion to $600 billion per year. That means dollar get exported to other countries and don't come back. Hence, not enough money left to pay back debts. Since oil is a big reason for our trade deficit (~3 billion barrels per year imported at $100 per barrel = $300 billion) the rise in oil prices precipitated the housing crisis.

And why do prices not increase much right now? Remember, money is created through increasing debt. No new debt, no additional money, no pressure on prices:

See what happened in 2008?

We agree that oil spiked the trade deficit, but I do not think that it follows from that all mortgages had to default. Do you mean this 'impressionistically'?

If the trade deficit caused the mortgage defaults directly, why did it affect sub-prime lenders, and some states disproportionately....and now follow a pattern of folks buying more from overseas having less money to pay on their mortgage. I would suppose a lot of sub-prime people did NOT consume much foreign made crp. I just don't see how it makes any 'micro' sense at all.

 

[Grisu]

We agree that oil spiked the trade deficit, but I do not think that it follows from that all mortgages had to default. Do you mean this 'impressionistically'?

If the trade deficit caused the mortgage defaults directly, why did it affect sub-prime lenders, and some states disproportionately....and now follow a pattern of folks buying more from overseas having less money to pay on their mortgage. I would suppose a lot of sub-prime people did NOT consume much foreign made crp. I just don't see how it makes any 'micro' sense at all.

Because those $ are then missing in the domestic economy to buy products which would then enable the businesses to pay salaries. It is not the person that "exports" the money that may be short but the economy as whole will lack it. Remember the post where I introduced the family with the $100. Imagine now you would pay every year the neighbor $5 for something. That's your trade deficit; Your money supply would continuously shrink. Now imagine people in your family had borrowed money with interest in the anticipation that the money supply will rise over time. They will default on their loans.

 

[webbie]

Entire deal was based on myths. No one can claim high prices helped because, over time, oil and energy inflation is nothing much.

I won a couple bets from those crazies - I remember one which I gave 2 to 1 that oil would not be over $5 a gallon in 2011 (it was 2006 when we bet). Never collected, though - not worth my time digging through my emails.

Fact is, for general discussion, energy is unlimited. That is, there is plenty of it. No one cares whether their oil comes from fossils or from bacteria.

As far as the climate, it's a real problem but one we are not likely to solve because it's the perfect human greed problem....that being that we can pollute now and others will pay later. There has rarely been such a problem solved by capitalism. No reason to. There is more money to be made from cheap energy and even disease and dislocation, etc. than there is from proper planning. It's a version of the Trolley Problem. Give most people a choice between some $$ and pleasure in their lives now...or helping out someone in 100 years, and the results will likely be the pleasure now.

 

[jharkin]

Whaaaaa ? Winning a bet on gas prices proves energy is infinite???

 

[Grisu]

Whaaaaa ? Winning a bet on gas prices proves energy is infinite???

Of course, , there is precedent: http://en.wikipedia.org/wiki/Simon–Ehrlich_wager

 

[webbie]

Whaaaaa ? Winning a bet on gas prices proves energy is infinite???

Well, it proves something - mostly that looking at a single "sounds right" theory and drawing conclusions based on that is poor judgement!

There is certainly plenty of energy to fuel mankind - we are a blip on the radar when it comes to energy! When it comes to liquid or other portable fuels, it currently is a matter of innovation which is somewhat tied to price. That is, at over 60-80 a bbl lots of alternatives make sense - like biodiesel:
http://mobilebiofuel.com/processors/

or plant based liquid fuels:
http://solazyme.com/

In summary, it was silly to consider - given current technology and the available money and resources we can throw at the problem - that only oil from wells was in the equation.

 

[jharkin]

Ahh I see, those of us who don't believe the techno-cornucopia vision are gullible simpletons.what was I thinking

Funny thing is if you actually read stuff published over there, they were not counting only conventional crude, and mostly not predicting the mad max scenario. Details smetails....

Oh well, have fun discussing - I'm out before it goes to the can ....

 

[webbie]

Ahh I see, those of us who don't believe the techno-cornucopia vision are gullible simpletons.what was I thinking

Funny thing is if you actually read stuff published over there, they were not counting only conventional crude, and mostly not predicting the mad max scenario. Details smetails....

Oh well, have fun discussing - I'm out before it goes to the can ....

Hmmm, no one is asking you to take offense with my opinion - I don't take any with yours!

I'm a generalist. My discussions about this were usually with people who knew very little about the overall energy picture, but had latched onto a Oil Drum article or other link as a reason why they knew things were going to get bad quickly...

My "research" consisted of simply believing that Boeing, Airbus, GE and all those other companies are not fools and if this was real ($10+ a gallon by now and running out) they would not be designing the nest generations of aircraft. These companies have to think 30-50 years down the pike.

$5 or $10 a gallon wouldn't be Mad Max, which is just the point. The folks I was debating with insisted that it was. The odds of a Mad Max scenarios in the modern world are very low. It's possible, but I'd give it fairly low odds. Something like 1 in 10,000 over the next 30-50 years combined.

Then again, the odds of the last financial crisis were given at some ridiculously low number also. Way lower chance than that.

Hey, if those folks were right - or become right - I'll be the first to admit I got it wrong. But I do believe that technology, by and large, will save us. In fact, it's almost the only thing left that can.

 

[woodgeek]

Not simpletons....just an echo chamber where a lot of critical thinking went out the window. Certain crucial hypotheses went unexamined and taken for granted for many years. Several folks who didn't tow the line got banished, after writing several articles that considered a less grim outcome.

 

[Grisu]

Well, it proves something - mostly that looking at a single "sounds right" theory and drawing conclusions based on that is poor judgement!

Funny that it is called a "theory" when someone simply says a finite amount of something will be exhausted at some point if consumed continuously.

There is certainly plenty of energy to fuel mankind - we are a blip on the radar when it comes to energy! When it comes to liquid or other portable fuels, it currently is a matter of innovation which is somewhat tied to price. That is, at over 60-80 a bbl lots of alternatives make sense - like biodiesel:
http://mobilebiofuel.com/processors/

Not to rain on your a-wish-will-come-true thinking but biomass can supply about 7 to 10 TW of energy per year assuming we and animals just don't eat anymore. We consume currently about 13 to 14 TW in energy already not counting future population growth or increased demand through economic development of other countries.

In summary, it was silly to consider - given current technology and the available money and resources we can throw at the problem - that only oil from wells was in the equation.

In summary, at the time we will need it we may neither have the time or the resources left to "throw at the problem".

 

[Grisu]

My "research" consisted of simply believing that Boeing, Airbus, GE and all those other companies are not fools and if this was real ($10+ a gallon by now and running out) they would not be designing the nest generations of aircraft. These companies have to think 30-50 years down the pike.

Is that really a metric you rely on? And you call PO theory nonsense? What are all those companies supposed to do? Just declare that the products they want to sell will be obsolete in 10 years, close shop and write off billions in investments? So when the banks said in 2007 that CDOs were perfectly save you would have also believed that unquestioned?

$5 or $10 a gallon wouldn't be Mad Max, which is just the point. The folks I was debating with insisted that it was. The odds of a Mad Max scenarios in the modern world are very low. It's possible, but I'd give it fairly low odds. Something like 1 in 10,000 over the next 30-50 years combined.

And on what research do you base your numbers? Was the Great Depression also highly unlikely but, OMG, also just happened?

Then again, the odds of the last financial crisis were given at some ridiculously low number also. Way lower chance than that.

Hey, if those folks were right - or become right - I'll be the first to admit I got it wrong.

That will help a lot once we are over the peak. I am sure our children will appreciate our apologies.

But I do believe that technology, by and large, will save us. In fact, it's almost the only thing left that can.

Save what? Our entitled lifestyle to which we are clinging with all might? We can save ourselves pretty easily if we would acknowledge that we have partied to much, accept the hangover and leave our kids with a world that still has the resources to support their livelihood. Nevertheless, that would assume we all scale back our life tremendously. It is so much easier to believe some magic will happen.

 

[webbie]

Save what? Our entitled lifestyle to which we are clinging with all might? We can save ourselves pretty easily if we would acknowledge that we have partied to much, accept the hangover and leave our kids with a world that still has the resources to support their livelihood. Nevertheless, that would assume we all scale back our life tremendously. It is so much easier to believe some magic will happen.

Well, yeah, I do rely on observing what happens to plan what might happen! It certainly beats a slogan or something posted on the wall.

GE can very easily move more of their resources to wind energy, electric generation, etc. and give up on the jet engine development. Same goes for the others. They could easily use their engineering prowess to develop higher speed trains, ships or other Big Picture items.

GE has been in business since 1892. They've seen change.

So, yes, I unabashedly look to people much smarter than I am to see which way the wind may be blowing.

As to magic, it's said that real high technology is indistinguishable from it.

Problem is, one thing does not negate the other. Of course we have partied too hard. The Europeans did so too when they cut every tree on the continent. The dust bowl and many other events - same thing. I think fossil fuel use and maybe even energy use per capital will go down in the short term. In the longer term, it may depend on how clean the sources are - nothing wrong with using energy if it's relatively benign in terms of effect.

My kids are using MUCH less energy than the last generation (in a general sense). I just read that, on average, those born after 1985 or so are driving 20% less. That is a major change!
"The average annual number of vehicle miles traveled by young people (16 to 34-year-olds) in the U.S. decreased by 23 percent between 2001 and 2009, falling from 10,300 miles per capita to just 7,900 miles per capita in 2009."

Another "technology" benefit:
"Younger Americans are also using technology to substitute for driving, connecting with friends and family online, substituting Facebook, Twitter, Skype, or FaceTime interactions for in-person visits and using online shopping and e-commerce in place of driving to and from grocery and retail stores, the report notes."

http://www.theatlanticcities.com/co...-are-driving-so-much-less-their-parents/1712/

 

[woodgeek]

Save what? Our entitled lifestyle to which we are clinging with all might? We can save ourselves pretty easily if we would acknowledge that we have partied to much, accept the hangover and leave our kids with a world that still has the resources to support their livelihood. Nevertheless, that would assume we all scale back our life tremendously. It is so much easier to believe some magic will happen.

This is exactly my rub. What does geology have to do with our 'entitlledness'? Are we running out of oxygen because we drive cars that are too big and forget to turn off the lights? The earth does not care not care about politics, or who is using resources or for what purpose. The ill thing about the Drum, was that the core audience over there had a vested/emotional interest in believing in the crash scenario or die off or whatever, because it was poetic justice or something. In my mind the two things are simply **not related**. Good people can get cancer at 40, and azzhats can live to 100. Selfish materialistic societies can find the world has plenty of FF, and (in an alternative universe it seems), a bunch of hippies could be left shivering in the dark.

All this PO stuff makes me mad not b/c I think lefties are coming to take my energy and make me wear a scratchy hemp sweater, but because it is a colossal distraction from the genuine problems in our society, like financial inequality or AGW.

I also have to agree with Craig that PO and associated doomer scenarios are also a money making scheme at this point, by which unscrupulous folks like Beck prey on the unwary. While you have given this a lot of thought, a lot of folks are risking their life savings or retirement plans on bogus goldbug investments and huge MRE stores.

 

[Grisu]

Well, yeah, I do rely on observing what happens to plan what might happen! It certainly beats a slogan or something posted on the wall.

GE can very easily move more of their resources to wind energy, electric generation, etc. and give up on the jet engine development. Same goes for the others. They could easily use their engineering prowess to develop higher speed trains, ships or other Big Picture items.

Only if they have customers for it. As long as we all believe things will continue to grow for decades to come, they have zero incentive to change their business model. Pretty much everyone knows smoking is bad for their health but Altria et al still make a killing. Plus, how many of GEs earlier competitors went bankrupt because they did not see some technology change coming. Ever heard of Kodak?

So, yes, I unabashedly look to people much smarter than I am to see which way the wind may be blowing.

That is why I look at the research and numbers behind it and also consider the agenda of the source. What do the people from the Oildrum have to gain from PO versus companies from us not believing it?

My kids are using MUCH less energy than the last generation (in a general sense). I just read that, on average, those born after 1985 or so are driving 20% less. That is a major change!

Really? That means they will need 5 years to use what we consume in 4 years. Still sounds like a tremendous difference? Math, how inconvenient.

 

[Grisu]

I also have to agree with Craig that PO and associated doomer scenarios are also a money making scheme at this point, by which unscrupulous folks like Beck prey on the unwary. While you have given this a lot of thought, a lot of folks are risking their life savings or retirement plans on bogus goldbug investments and huge MRE stores.

Which follows the failed assumption that a society can "save" for retirement with money or money-equivalents such as gold. The only thing that will matter at the time we "retire" is whether the economy can supply the goods and services we would like to have to resume our lifestyle. Burn away those resources and all retirement savings just became worthless.

 

[webbie]

Burn away those resources and all retirement savings just became worthless.

Time to start that "off the grid survivalist retirement community" site. Beckster will surely promote it as his rates get lowered when the audience dies off or loses power.....

 

[Grisu]

Time to start that "off the grid survivalist retirement community" site. Beckster will surely promote it as his rates get lowered when the audience dies off or loses power.....

Take the retirement out of the title and that is exactly what we should be doing. Isn't it funny that the concept of "retirement" only started with the industrialization which began with the discovery of fossil fuels? Saving for "old age" was previously accomplished by getting lots of children who supplied the labor to keep someone alive when they could not work themselves anymore.

Laugh about it as much as you want but if you are right and we do as I suggest, it is a mere inconvenience. If I am right and we do you as you suggest, you may just have accomplished the extinction of the human species.