Planning for Contingencies,
I'm reluctant to make predictions without a lot of evidence to support them, but there is now a lot of evidence showing the near-term trends of energy use in industrial societies, with good historical comparisons.
The currently stated objectives of western governments are not compatible with near-term real-economic requirements for societal survival. They can't be carried out. They are a bluff, or some kind of strange trick to create a crisis, before a "new-solution" is magically presented to us.
Gonzolo Lira just pointed out what happened to the US during the Arab Oil Embargo , starting in 1973. It caused Stagflation in the US, because prices went up and the economy imploded when the core commodity, oil quadrupled in price. America still produced almost all the oil it needed, and Americans used a lot less oil than we do now. Lira points out that Europe is now doing that to itself (at America's behest).
It's worse for Europe, because Europe produces very little oil or gas without Russia. Global economy is so tightly knit, and running right at capacity, that there is not slack to be given from elsewhere, even if the oil were the same, and the refineries could just use it as-is. It's not. They can't. It also has to come long ways by ship, with long transit delays, and shipping shortages are already a big problem. Pipelines that work 7 days per week are the best. Russian pipelines and oil are the best for European refineries and industry.
American and Qatari liquefied natural gas are a pipe-dream, because the billions of dollars required won't exist when the economy shuts down for the decade to build that infrastructure. Japan and other Asian economies already buy that stuff, are set up for it, and will outbid Europe.
A pipeline from Iran is a good idea, blocked so far by USA/NATO, since Syria wants to collect for Syrian participation, and is getting pounded for that affront.
Here in Texas, with the summer driving season already underway, people now let me drive just under the speed limit, maybe even follow me for 30 miles, instead of tailgating, flashing their brights in my mirror, and punching the accelerator to jump past me at 90 mph, like usual.
WTI is $120/bbl. The bank that used to show that price on the time & temperature display quit doing so in late March.
It went from being interesting to threatening, I guess.
I suspect the WEF/Globalist/Bilderberg plan was to spring a global financial crisis all at once, with the miracle solution of global central bank digital currency, with initial free-money, and a free smartphone to go with your free biometric ID, which could be used anywhere, and only by you, as long as you remained on good-behavior.
The failure of Russia to financially collapse, coupled with the advanced preparations for a shared trade-currency with organizations like the Eurasian Economic Union, BRICS and Shanghai Cooperation Organization, seem to make that plan too risky now. The choice would be a real choice, and a lot of people in a lot of countries are already prepared to opt out of the nefarious biometric CBDC scheme. It has been outed.
Global biometric CBDC is a trap that won't catch all of us, and like the Kool-Aid, it won't work without full participation, because everybody will shortly want out.
Russia and China have the opportunity to be good guys this summer for an affordable price. Russia can make a profit on oil and meet the national budget when it is $40/bbl (maybe lower). Russia is already channeling big middleman-fees to Chinese tankers and Indian refiners for taking Russian oil at night, refining, rebranding and selling it at a handy profit for all, even including the final customer. Russia and India have both expressed intentions to sell grain preferentially to countries whose populations need it to survive, like Egyptians... These charitable acts will reduce profits of Oil-Majors and Agribusinesses like Cargill, Archer Daniels Midland, and even Bayer/Monsanto, since Russian grain eschews their patented seeds and necessary inputs.
Cheating and accepting cheap grain are the low-hanging-fruit. This will throttle-back the extractive cash flows to the imperial financial machine, which is set to grab all the productive assets of countries that can't make their interest payments to banks, hedge funds and the IMF, like in the Asian Economic Crisis. It's that time of the credit-cycle again, unless it's not...
How beguiling, to be spared from the fate you have dreaded for 30 years, when you know it is an evil, tyrannical, downright unjust fate, cast onto your country by a cynical global parasitic class... "Odious debt" is the legal term. It's ok to default on it, and you might gladly do so, if you only had a choice.
Russia shares your pain...
China is likewise sympathetic, and willing to give you a clean slate, a fresh credit card, to replace the Bank-of-America VISA card you are about to cut up. You won't be able to use it at every gas station (Rosneft and Valero, not Texaco), but you can get by without the slavery of unpayable debt hanging over your head.
When will this transition happen and how long will it take. "Slowly at first, then all at once"? What will that mean?
Cheating is underway, and will have to increase and become the basic business model for EU oil and gas purchases. It will be a hassle, but as long as the pipelines are still running, it just means pretending you don't know that the petroleum products on that tanker originated in Russia. Easy.
Cheating will rapidly refine as a business model. Funds to build LNG ports and transport ships in Germany will hit snags in committee. It will just go so slowly that it does not happen. Nordstream-2 just sits there, calling to you... "Profits, profits, warm winters, social approval from friends and family..."
What I don't know is how close to the precipice the western financial machine is, and when it will trip over that edge.
I personally think that the east does not want to give it that push. The east is also invested in that machine. The controlled-demolition of western finance by western financial elites appears non-viable now, and it was their main option.
WW-3 is always a button they can push. It just needs to keep being a slightly worse option than something else, anything else. Walk it down slow...
I think everybody can keep not-rushing-the-crackhead-with-the-detonater for awhile longer, indefinitely.
Just ignore all that stuff about your mom.
While the world is lying and cheating, and paying less to western financial institutions, and starting to default on $US debts (I'm looking at You too, "Eurodollars")
western central banks can play their money-printing games, and they might try some kind of CBDC, but they will lack total-buy-in, and it will be part of a crumbling system, and the neighbors will have this other gig going across the street, which won't look bad by comparison. The neighbors won't be paying on that credit card, mortgage, and SUV, either. (It's just my pension. I need my pension. I earned my pension. The neighbors borrowed my pension..)
This will go on for longer than I can imagine. Everything always does. That's my prediction.
Red sends this article on Surplus Energy Economy, the economic model that modern economy runs on the energy remaining after energy is used to extract, refine and employ energy sources, the net energy after all that, the gasoline, diesel and electricity after production-expenses are paid. It's odd that that was not considered as a discrete mode of analysis before the 1930s, and is still not embraced by many economists. "The third part of the “blindingly obvious” trilogy is that money acts only as a ‘claim’ on the output of the real (energy) economy."
This essay looks at the tightly linked energy and economic growth of recent centuries, then overlays the increasing cost of extracting and producing forms of energy, which reaches a point of dragging-down the economy, as happened during the Arab Oil embargo (and has been happening since the middle of 2018 by my estimations). this provides a very useful framework for understanding modern economics, which nobody really wants you to understand. It looks like it is downhill from here forward for the average person, due to rising costs of energy extraction.
This just in (and forever) There's No Immediate Cure For Sky High Gas Prices (Recession is not a "cure", but another resulting ill.)
The borders in Eurasia are complicated and confusing to an American. I can remember the Colorado and Mississippi rivers, but Europe has so many big rivers and seas, even Russia does. This clear and excellent article has really helped my understanding of all of the geostrategic and economic considerations around the Black Sea, Azov Sea, Kerch Straits and the internal waterways of Russia. Adequate maps, too.Black Sea Geopolitics and Russia’s Control of Strategic Waterways: The Kerch Strait and the Sea of Azov
St Paul Minnesota mandated COVID vaccination for all city employees by 12/31/2021, and about 20% did not comply. This was unilateral, not negotiated with the unions. The judge says the city did not have that unilateral right, and needs to renegotiate this in contracts. The workers requested a testing-option, bodily autonomy.
Very reassuring medical article explains that 50 years of viral mutation, compressed to 4 years, allowing monkeypox to spread rapidly in humans across the globe happened coincidentally after the virus jumped to humans, and only took 4 years instead of 50, because the human immune systems made it mutate 12 times faster. See how that works?What the surprising mutations in the monkeypox virus could indicate about the new outbreak
To be "fair and balanced" I'm including this conspiracy theory that the 50 years of mutations, compressed to 4 years, that allowed monkeypox to spread effectively in humans on a global scale, for the first time ever, happened in a lab, and was even the subject of one of those "tabletop exercises", like a war-game without a war, that predicted it's date of discovery within a week, and just last year. You've seen this kind of paranoid rambling with graphs, analysis and footnotes before... They even quote Robert Malone MD ,and he's a "vaccinated, vaccine-developing anti-vaxxer" as he says himself.Study Finds Latest Monkeypox Outbreak Is Result of Biolab-manipulated Virus Possibly Released Intentionally
(not pictured with Jenny by food-jungle in late afternoon)
The stead looking good John! The swirling vortex of humanity that we lean into seems to be thickening as we watch in horror. Nice to see and hear from some who are working against it. Hopefully it isn't all in vain. Welcome to hospice earth, a condition I was warned of some decades back and thought, hmm how soon? Too soon apparently. I sat with my former in-laws in the early eighties and at that time counselled that parents everywhere wanted a better life/world for their children and that it would not be possible. We already were at the apex of industrial society and a lower standard was working its way in at that time.They didn't believe me of course. My ex mother-in-law, now almost eighty finally notices and commented on my clarity at that time. Hind sight is 20/20 while fore sight seems incalculably small if not non existent.ReplyDelete
Thanks Red. It's still Limits To Growth. That book/analysis/model was always pretty close to the mark. Deaths and births have both run slightly lower than predicted, but the timeline for industrial output rolling over looks like second half of 2018, which is about right.Delete
They always said that the initiation of crisis-actions would change things, when those were instituted. I'm watching, but the CO2 machine already topped out.