
This is the road to Arkham Asylum.
There are a range of secondary factors impacting the day to day fluctuations in oil price such as:
Speculation
Financial speculation in oil futures is being offered increasingly as the reason for high oil prices. True, speculation is rife. However, the futures market is a zero sum game. For every long position there is a short position and the price is ultimately struck by the individual who takes delivery of the oil - which is then refined and purchased by a consumer. For so long as consumers keep demanding oil at ever higher prices, the price will continue to rise.
The only way speculation could impact the oil price is under accumulation. Inventories of crude oil and refined products have been falling for a year (see figures 14 to 17).
Political unrest
True, political unrest in exporting countries such as Iraq and Nigeria means that less oil is being produced. But this situation has prevailed for many years now and is likely to get worse as energy poverty begins to bite.
The depreciation of the $US
True, the depreciation of the US$ has contributed to the rise in oil prices. But the oil price has risen in € too.
Off limits exploration
True, there are vast tracts of the USA that are under-explored in the ANWR and off the east and west coasts where the US has placed a high price on protecting their own environment. But it is not true that the Middle East and Russia are under-explored and that greater access to these areas by OECD companies would transform the current situation.
In summary these secondary factors touted by the MSM, politicians and oil companies are nothing more than an excuse and a distraction from the core problem which is demand growth running ahead of supply growth for over three years now. If the USA, Russia or Saudi Arabia could turn on the taps and produce an additional 3 mmbpd, the oil price would fall tomorrow. But they can't and the only way the oil price will come down is by reduced demand brought about by pricing poor people out of the energy market and by deepening recession.
We are now in the early stages of a full blown energy crisis that was predictable if not wholly avoidable. Politicians are awaking to the crisis now that escalating energy costs make its existence plain to see. It is highly unlikely that politicians will now grasp the gravity of the situation that the OECD and rest of the world faces and the responses will likely be ineffectual and too little too late.
The principal reason for current high oil price is the proximity of a peak in global oil production. Politicians must understand this and then grasp that natural gas and coal supplies will follow oil down by mid century. Reducing taxes on energy consumption right now is the wrong thing to do. Taxation structure needs to be adjusted to oblige energy producing companies to re-invest wind fall profits in alternative energy sources on a truly massive scale.
Energy efficiency should be the guiding beacon of all policy decisions and this must apply equally to energy production and energy consumption.
Posted by Euan Mearns"I am not going to comment on a book that I haven't read," she said, referring to McClellan's scathing memoir, "but what I will say is that the concern about weapons of mass destruction in Saddam Hussein's Iraq was the fundamental reason."
"It was not the United States of America alone that believed that he had weapons of mass destruction that he was hiding," Rice said, dismissing suggestions that the administration knew the intelligence was incorrect.
"The story is there for everyone to see, you can't now transplant yourself into the present and say we should have know what we in fact did not know in 2001 and 2002," she said. "The record on weapons of mass destruction was one that appeared to be very clear."
Those who were skeptical should have spoken up at the time and argued against U.N. sanctions such as the oil-for-food program, she said.
"The threat from Saddam Hussein was well understood," Rice said. "You can agree or disagree about the decision to liberate Iraq in 2003, but I would really ask that if you ... believe he was not a threat to the international community, then why in the world were you allowing the Iraqi people to suffer under the terms of oil-for-food."
The heart of the McClellan book concerns Bush's decision to go to war in Iraq, a determination McClellan says the president had made by early 2002 — at least a full year before the invasion — if not even earlier.
"He signed off on a strategy for selling the war that was less than candid and honest," McClellan writes in "What Happened: Inside the Bush White House and Washington's Culture of Deception."
As gasoline and food prices continue to rise, the squeeze to make family budgets balance each month becomes more of a struggle. After the big savings have been found and taken, smaller savings have to be found to make ends meet.
This can be frustrating as it can feel like everyone is being nickled and dimed to death. That's why it's important to realize how these small amounts can make a huge difference in your overall financial health.
You've likely heard about the little ways to save money a million times. Money-saving advice includes standards like packing your lunch instead of buying it at work, skipping the Starbucks and making your coffee at home and watching videos at home instead of going out to the movies. While you may have grown tired of hearing them, they are still as true as ever and even more important when the economy is struggling.
More from TheStreet.com: • Use Your Pantry to Pinch Pennies • Minimum Payments Cause Maximum Financial Pain • Ten Strategies to Fight Bank Fees |
Saving small amounts of money is good advice for everyone, it's not as essential for people that are currently living well below their means. If you spend $5 on a cup of coffee each day, but you're still able to put away five times that amount toward your savings, that coffee splurge isn't going to hurt as much as for someone who isn't saving anything. For those that are barely making ends meet, spending small amounts of money can be the difference between deep debt and a nice retirement account.
When you are faced with a budget that isn't balancing, you have two main choices: earn more money or cut more expenses. Unfortunately, many turn to a third alternative. When they can't seem to make their budget balance, they decide that it's acceptable to place the difference onto a credit card. Even though the monthly shortfall in the budget is small, placing it onto credit cards is one of the worst financial moves that a person can make. The result will be a downward cycle that will not only keep you in debt, but also create a tremendous amount of stress.
There is often a false assumption that saving $10 and spending $10, although opposite, are relatively the same. For example, if a person saves $10 a day, after a month their account will have $300 while if a person spends $10 a day, that will result in a debt of $300. While on the surface this makes perfect sense, the problem lies in that these numbers fail to take into account the interest that can be gained or charged on this money. It is this failure to understand the concept of compound interest and the dramatic effect it can have that greatly changes these results.
It's important to understand that it takes very little to start sinking into debt. For most people, spending $10 a day would not be considered extravagant spending by any means, but $10 can result in tens of thousands of dollar of debt. It's simple to see when you compare the results of what happens when one person saves $10 a day while the other spends $10 a day that he doesn't have.
If a person were to save $300 a month (approx. $10 a day) and invest it to get a 5% yearly return, that person would have $20,402 in the bank after five years. On the other hand, if a person ends up spending $300 a month more than he has and puts it onto a credit card that he doesn't pay off over the same 5 year period, that person will owe $36,259, assuming a 26% credit card interest rate. After five years, the difference between saving $10 and spending $10 each day results in a $56,661 gap in net worth between the two.
Add another five years to the same patterns, and the results are even more dramatic. After 10 years, the person who saved $10 a day would have $46,585 in the bank, whereas the person who spent the $10 he didn't have would be $167,470 in debt, resulting in a net worth difference of over $210,000.
Of course, there are many other factors that could alter these calculations. The interest you can earn and what your credit card interest rates are will vary from this example. There is a minimum amount that the person would need to pay on a credit card each month. If debt to this extent began to occur, the person would have their credit cut off long before this amount accumulated and would likely need to declare bankruptcy. The point is that over time, small amounts added to debt can result in far more debt than most people realize.
Once you learn that saving a small amount and overspending a small amount aren't simple opposites, you understand the importance of having a budget and strictly sticking with it. If you are able to fight through the hard times and keep your budget balanced, then you set yourself to reap great financial rewards when the economy finally turns around.
by Jeffrey Strain1. Obsessive compulsive blogging disorder: Marked by intrusive thoughts and repeated posting, the syndrome typically involves constant, irrational worrying about comments on the latest blog posts and feelings that something bad will happen if he or she does not post at least 20 times a day. It is related to obsessive searching disorder, whose telltale signs include excessive use of Microsoft and Yahoo search engines.
2. Social network schizophrenia: Disturbed moods, thoughts and behavior that make it difficult for the patient to distinguish fact from Facebook. Hallucinations include friends throwing sheep at them. People with social network schizophrenia believe their hallucinations are real and the rest of the world is nuts, making it difficult to communicate with them or even attempt to help without using the Superpoke feature on Facebook.
3. Digital depression: Dark moods, feelings of loss or lower self-esteem resulting from being dissed by conference-roving Twitter mobs, getting unfriended, unlinked or unfollowed on your favorite social network or microblogging platform -- or getting zero comments on your blog posts.
4.FriendFeed phobia: Characterized by a deep-seated fear that if you use FriendFeed, you will find out you actually have no friends.
5. Twitterer's Syndrome: Related to Tourette's syndrome, an involuntary, sudden, rapid, recurrent 140-character typing tic. To wit: "I'm not sure what's noisier. Twitter or my baby who is teething. I think the baby wins, but not by much," Scoble says.
6. Binge surfing disorder: Consuming more page views in a single sitting than most average people could in a two-week period. Characterized by abnormal craving for updates from Valleywag and VentureBeat. Side effects can be severe. Treatment varies. Consult your shrink.
7. Post-traumatic inbox disorder: Feelings of helplessness... and loss of control triggered by overwhelming influx of e-mails, resulting in an inability to sleep, work or enjoy life. It is related to post-traumatic update disorder: the failure to update your status on Facebook and other services, which leads to generalized anxiety.
SIMON BAIN | May 26 2008 |
The International Energy Agency has ordered an inquiry into whether the world could run out of oil in four years' time, it was reported yesterday.
The IEA has concerns about what might happen in 2012, when demand for oil, boosted by the rapid growth of the Chinese and Indian economies, is expected to have reached 95 million barrels a day. Global supply at that point is projected at only 96 million barrels a day. Such a thin margin would be vulnerable to any sudden supply crisis in volatile countries such as Nigeria, Venezuela or Iraq, now estimated to have overtaken Saudi Arabia as the biggest oil nation.
The IEA said its inquiries would form part of short and long-term forecasts to be published in July and again in November. Its energy research chief, Lawrence Eagles, said: "Up to now we have believed that supply can cope with demand. One caveat is that we don't know for certain whether estimates of reserves in countries such as Saudi Arabia are entirely accurate.In the U.S., data released on Friday showed that highway miles driven in March fell 4.3 percent from a year earlier, the first time this has happened in March since the last major oil shock in 1979.
Loveliness was everywhere this holiday weekend in upstate New York, and it was probably hard for many to believe that the wayward nation would return to the dread uncertainty of life in the crash lane when the barbeques were over. There was even a wan overtone to the late-night sports news about the Indy 500 race -- as though the spectacle of cars droning round and round a speed oval symbolized the futility of American life in this moment of our history.
I had a discussion with one guy at Sunday night party about the prospects for hydrogen-powered cars. We rehearsed the usual reasons why such a system was unlikely to get up-and-running -- and then he said, "...but what if we took all the money from the war and put it into something like the space program and... they came up with some way to make it happen...!"
This is certainly the golden heart of the great wish out there, as the empire of Happy Motoring begins to run down on $4 gasoline. It seems inconceivable that a society so bold as to put men on the moon (fer crissake) can't overcome such a prosaic problem as finding something other than oil byproducts to run our cars on.
From this holy font all cognitive dissonance flows.
It seems inconceivable, but it begins to look like that's the way it really is, and we just can't accept it.
Of course, one of the reasons that Americans are so anxious to get away on a holiday weekend from the places where they live is because we did such a perfect job the past fifty years turning our home-places into utterly unrewarding, graceless nowheres, where the private realm of the beige houses is saturated in monotony, and the public realm has been reduced to the berm between the WalMart and the strip mall. Now, we barely have the gasoline to run all this stuff, let alone escape from it for a weekend.
We're at a dead end with all this and a lot of Americans are paralyzed with fear about what's next. This may actually be a deeper fear than the anxiety about money and banking in 1933, when Franklin Roosevelt was sworn in and tried to reassure the nation. Back then, despite the grave problems of capital, we still had plenty of everything: plenty of good productive land, plenty of manpower earnestly eager for hard work, plenty of ore in the ground, shining cities equipped with excellent streetcar systems, a railroad network that was the envy of the world, sturdy small towns and small cities fully equipped with locally-owned business, and a vast number of small family farms that could re-absorb family members unable to get wages in the cities. Most of all, we had plenty of oil in the ground, and the world's biggest industry for getting it out and selling it. What we didn't have in 1933 was cash money.
The crisis at hand now goes way beyond a crisis of capital -- though that is certainly part of it. Notice how many of the things we had in 1933 are gone now. Our cities, with a few exceptions, are imploded husks. Our small towns and small cities (Schenectady, home of G.E.!) are gutted, especially in terms of locally-owned business. Our passenger rail system is worse than anything a Soviet ministry might produce (while the airline industry that replaced it is dying of a kind of financial hemorrhagic fever). Our local transit hardly exists anymore. Family farms have all but disappeared. We have plenty of manpower earnestly eager to become American Idols (but certainly not for heavy labor). Our oil industry now supplies only a fraction of the world's daily supply (and not even enough for half of our own needs).
What happens now? We face not just change but convulsive change. The public senses the rapid unraveling of our car-centric arrangements. In the week before the holiday, gasoline prices went up several cents each day -- in upstate New York, it crossed the $4 mark and kept going up. The trucking system faces collapse as diesel fuel price-rises exceed even the rise in gasoline, and the vast number of independent truckers who make up the system confront the individual calamity of a personal business failure. American Airlines last week announced severe measures to keep operating through the fall of 2008. But none of the airlines can feasibly carry on as usual with oil prices above $120-a-barrel -- and the ominous message is of a business model that has no conceivable way to adapt to the new reality. Most likely, in a very few years air travel will no longer be a "consumer" enterprise.
In the background of these practical problems -- "off screen" during the holiday of car races and ball games -- is a crisis of capital orders of magnitude worse than the one faced by Franklin Roosevelt in 1933. For, behind the "liquidity" (i.e. insolvency) issues faced by the big institutions lurks the Godzilla of the derivatives trade, which has evolved into a black hole capable of sucking all notional "money" into oblivion. That "money," which represents the aggregate value of our society, also amounts to the emperor's new clothes of an empire in serious trouble. As the black hole of derivatives sucks away these "new clothes," America will stand naked against the elements of fate.
NVDL: Whether it's summer or winter, we're heading for winter, one of the grimmest in history.
Police said the killing was not gang-related and yesterday, as friends laid flowers at the murder scene, close to Sidcup railway station, Lee Bentley, manager of the Metro bar, said the attack appeared to have been triggered by a row over the alleged theft of a mobile phone.
“Nine days ago, a guy came to the bar and caused trouble,” said Bentley. “He accused [Knox’s friend] Dean Saunders of stealing his phone and hit him in the face. We cleaned up Dean and barred the man.”
But the man, who is black and in his twenties, returned on Friday night armed with two knives and tried entering the bar, where Knox was a regular drinker.
What happened next is unclear, but Jade Nicholson, an assistant bar manager, said: “I saw Rob go outside and shout, ‘You pulled a knife on my brother, someone call the police’.”
Tom Hopkins, 18, who was drinking at the bar, said: “Rob had been trying to stop the trouble, it wasn’t his fault.
“All I remember was seeing Rob get stabbed in the chest. I ran over and me and my mate Tarik both tackled the black man. I jumped on top of him and he said, ‘I’ve got a knife, I’ve got a knife’. As I tried to grab the knife I didn’t realise he had another one in his other hand and he cut me in the back of the head.
“I was wrestling with him in the bushes and there were a lot of other people who were helping me out. It felt like it went on for six or seven minutes until the police arrived and then I walked around the corner from the bar. That’s when I saw Rob — it’s too horrible to describe what I saw. It was just red blood.”
Police said they were called to “a large disturbance” at the bar on Station Road at 12.07am, but Knox’s life was already seeping away. A friend, who asked not be named, said: “I had him in my arms. He said, ‘I just want some help’ and I laid him on the floor. When the paramedics came, they put pads on his chest to try to revive him, but it was obvious it was too late.”
Knox was taken to Queen Elizabeth hospital in Woolwich, southeast London, where he was pronounced dead just before 1am. A post-mortem is due to be carried out today.
Three other people were seriously injured in the attack, including Saunders, 21, who was stabbed in the neck and remains in hospital. Police said his injuries were serious but not life-threatening. Two other friends, aged 16 and 19, also received treatment.
A 21-year-old man has been arrested on suspicion of murder.
More.
... veteran oil traders and analysts still say $150 a barrel is possible as it becomes clear that a supply crunch will hit the market in the next five years if demand growth does not slow.
NVDL: Is demand growth slowing? Did you drive less than usual this weekend? Have China and India said to their 1 billion plus populations, "Sorry guys, guess we're not invited to the party. Let's go back to the farms. Ja, just leave your cars and go back to where you came from. " No, governments and individuals will find any excuse, elect any leader, that allows them to continue consuming as we are now. Even so, it's not going to continue for a lot longer, even if we insist that that's what we want. Demand Destruction is a factor, and we're seeing demand eroding in the collapse of airlines now, but it will take longer to filter through to less vulnerable businesses, but, it will. Recession and the complete collapse of housing/property markets is the long term consequence of these high prices. The markets will choke on them, and globalisation will kick back into reverse.
Kevin Norrish, of Barclays Capital, says: "Strong oil demand, in particular from emerging giants such as India and China, along with disappointing non-Opec supply, continues to underpin oil prices."
Taiwan, Malaysia and Indonesia, [have] started cutting their expensive fuel subsidies, a change that signals that the first cracks in the world's engine of oil consumption are appearing.But Hank Paulson, US Treasury secretary, said high oil prices reflected tight supplies and growing global demand and were not driven by market speculators. "I don't think this is about financial investors," Mr Paulson told CNBC. "This is about long-term supply and demand."
By Javier Blas, more.Bruce Wayne: I knew the mob wouldn't go down without a fight. But this is different. They crossed the line.
Alfred Pennyworth: You crossed the line first, sir. You hammered them. And in their desperation they turned to a man they didn't fully understand. Some men aren't looking for anything logical. They can't be bought, bullied, reasoned or negotiated with. Some men just want to watch the world burn.
Every one-cent increase in gasoline prices means Americans pay $1.42 billion more a year for gas, according to Stephen P. Brown, an economist at the Federal Reserve Bank of
From New York Times.
"The underlying factor is basically poverty," he said. "We are witnessing an increase in the number and intensity of crisis that generate displacement around the world. We are very worried."
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