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"The end of easy oil, and subsequent global collapse" The paper might not be right on all points or might be completely wrong entirely. But it is right on one
by 3327 12y ago
"The end of easy oil, and subsequent global collapse"
The paper might not be right on all points or might be completely wrong entirely. But it is right on one thing.
If you have have ever taken care of plants, what happens with a plant before it dies is something very odd - nothing.
It will look a little weak, but then it will suddenly completely die - almost overnight, shedding all leaves and going dry.
- zaroth 12y agoThe most interesting thing about the market is how everything you think you know can be wrong. Like how bad news is good news right before a Fed meeting, or how suddenly cheap oil is now bad because it's reducing investment in new pipelines and rigs. I think these quirky inversions are reliable signals of something, I just haven't figured out quite what. One thing's for sure, these predictions are exactly like a broken clock.
- enupten 12y agoIsn't the cheap oil the result of the Saudis arm-twisting the Russians and Iranians ? P.S: Shell is starting an exploration of oil in the Arctic, after Obama's executive order. I don't think the bit about investment in new rigs is well-founded.
- vixen99 12y agoMaybe in your neck of the woods the expression has a different meaning but I thought 'arm-twisting' meant getting someone to do something they initially didn't want to do. Hardly the case with the Russians and the price of oil.
- nl 12y agoThe causes of cheap oil are many, and varied. They include: - a reduction in Chinese demand - increased shale oil production - Saudi desire to reduce competition from high cost producers including Russia and shale oil - the failure of ISIS to capture the Iraqi oil fields - unanticipated increased production from Libya That's just first order causes. Second order causes are things like the US desire to hurt Russian foreign exchange by hitting their exports, and Saudi desires to decrease investment in new technology.
- zaroth 12y agoI was referring to a declining cost of oil historically being considered an economic stimulus because oil was money that was traditionally flowing out of the country. So reducing household/business energy cost meant more money in the bank for investment / disposable income spent in the local economy. Now all of a sudden the rhetoric is the slowdown the last quarter was due to the falling price of oil leading to a decrease in manufacturing orders for pipelines and rigs. The shift being that US produces most of its own oil (or used to before the latest Price Wars). If consumer confidence is low, the energy savings are paying down debt or going to savings, so now oil price falling is a net loss to the economy? Very hard to believe this, but that's the "word on the street". Not like the price of gas actually stayed low for long, refineries tightened up and the price recovered significantly, even while oil remains down 50%. Oh well...
- golergka 12y agoI think that it's because we don't yet have appropriate mental models to think about systems of such complexity.
- marmaduke 12y agoThey're called "critical fluctuations" in physics and occur before a qualitative change in organization.
- mazsa 12y ago> what happens with a plant before it dies is something very odd - nothing. No, this is what happens exactly: "Recovery rates reflect distance to a tipping point in a living system" doi:10.1038/nature10723 [pdf:] http://vasilisdakos.info/wp-content/uploads/2012/01/veraart-et-al-2012-nature-recovery-rate-living-system1.pdf http://vasilisdakos.info/wp-content/uploads/2012/01/veraart-... --> https://scholar.google.com/scholar?cites=14257091027999544800 https://scholar.google.com/scholar?cites=1425709102799954480...
- dredmorbius 12y agoThe term you're looking for is "Seneca Cliff", after the Roman Stoic philosopher, statesman, and dramatist. It's the observation that large and complex systems tend to fail suddenly and catastrophically. http://cassandralegacy.blogspot.com/2014/12/fossil-fuels-are-we-on-edge-of-seneca.html http://cassandralegacy.blogspot.com/2014/12/fossil-fuels-are... We see this in business as well: the falls of MCI-Worldcom, Enron, and the collapses of multiple financial bubbles follow this dynamic.
- SiVal 12y agoAnd we see its opposite. Take lots of large, complex companies that eventually came to an end an you'll see examples of everything. Some, like Lehman Bros. in 2008: Pow! Gone. Others, former giants like IBM and General Motors, for example, are looking like old soldiers that never die. They just fade away....