Discussion on:

Waiting for the punchline

Thanks for the piece, Chris.

Lots to talk about. I mean LOTS.

One thing that you don't treat, and which will play a huge role, is the paroxysms of geo-political mayhem that will be precipitated by the rolling denouement of the multiple story lines that you describe and of which we are all, mostly (even if only at a certain level) aware.

China's place in the global economy is growing by leaps and bounds. They do not have --and no such large state could have-- a truly stable society and government structure. Their one reliable available strategy for forcing domestic discipline is the demonization of foreign states and cultures. In full swing, and once the size of domestic markets challenges the export markets upon which they depend, they can easily create the most advanced and largest military capability in the world at a much smaller fraction of GDP than is achievable in the Western economies now. And in that same vein of discussion. The current economic crisis befalls a heavily leveraged US economy that has spent vast amounts of its domestic and foreign debt on what is the world's currently largest and most powerful militaries. The Chinese and US respective climb and decline curves will cross; probably within ... hmmm ... fifteen years? Ten? Eight?

China and te US are merely the two largest single factors on our political and economic landscapes. But since, alone, they are capable of bringing about complete, sudden, alteration of the status quo, the mind cannot even bring itself to boggle when we think about everything else than can be served up by any number of combinations of other players: the prospect of too much confusion is a sedative.

I think that this is basically what this is all about. Psychologists are finding that the only way to make people resist or even deny a hard truth is to explain more about it.

The Fracturalists miss what matters, sadly, so do the Peak Oilers.

Using fossil fuels does not provide an end product or a 'good' in return for the fuel. Except for taxi drivers and delivery men, driving a car does not pay for the car nor does it pay for the fuel. Driving the car does not pay for the road or other bits of infrastructure, the military needed to steal the fuel or the finance establishment needed to 'massage' the costs. Everything must be funded with loans which now total hundreds of trillions of dollars.

The only way users can meet the (credit) costs is if the fuel is very cheap. When the fuel becomes pricey -- because of diminished supply -- the fuel cost must be added to the cost of expensive credit. The outcome is economies falling underwater and entire countries becoming bankrupt.

YOU can point to frakking and 'technology' and I will point toward teetering France, Italy, Spain, Japan ... China, USA, the world's auto industry, the world's finance sector ... all poised at the edge of the abyss or ... over the edge.

This is the point when the cost of gaining new fuel cannot be met by the creditworthiness of the fuel consumer, this is 'net energy negative' and the world is very close to that point, two years away or less.

This isn't a theory, it is what the crude oil price in world markets say. The markets say the world is becoming poorer and must borrow less ... meanwhile, the cost of new fuel relentlessly increases. Fracking and deepwater drilling are a lot of things ... mainly expensive. It does not matter how much reserves a country has if nobody can afford them.

Right now there is rationing by access to credit, when this process is unworkable there will be physical rationing. There will be permanent shortages and the usual gas lines and panic. Permanent: when fuel is unavailable because the customers cannot afford it, there will be diminished fuel available as people become poorer, over time.

Sorry to rain on yr parades but the only solution is to get rid of the car(s).