Category: Uncategorized

Feel Like a Beer?

The preferred brew by state:

Looks like the UNITED STATES OF BUDWEISER to me.

Of course, there are exceptions:

  • Florida + Daniel Kennedy go for Stella Artois.
  • New Jersey and Indiana favor Miller Lite.
  • Texas, of course, drinks Lone Star.
  • And New Mexico drinks Old Mexico’s Dos Equis.

I’ll leave the other outliers to those interested.

Our Crude Oil Problem

From Gail Tverberg.

“Media outlets tend to make it sound as if all our economic problems are temporary problems, related to Russia’s invasion of Ukraine. In fact, world crude oil production has been falling behind needed levels since 2019. This problem, by itself, encourages the world economy to contract in unexpected ways, including in the form of economic lockdowns and aggression between countries. This crude oil shortfall seems likely to become greater in the years ahead, pushing the world economy toward conflict and the elimination of inefficient players.”

Here’s Gail’s argument:

“[1] World crude oil production grew marginally in 2021.“

“[2] The growth in world crude oil production shows an amazingly steady relationship to the growth in world population since 1991. The major exception is the decrease in consumption that took place in 2020, with the lockdowns that changed consumption patterns.”

“[3] Crude oil prices dropped dramatically when economies were shut in, beginning in March 2020. Prices began spiking the summer and fall of 2021, as the world economy attempted to open up. This pattern suggests that the real problem is tight crude oil supply when the economy is not artificially constrained by COVID restrictions.”

“[4] Food prices tend to rise when oil prices are high because products made from crude oil are used in the production and transport of food.”

“5] Quarterly crude oil data suggests that few opportunities exist to raise crude oil production to the level needed for the world economy to operate at the level it operated at in 2018 or 2019.”

“[6] Eliminating, or even reducing, Russia’s crude oil production is certain to have an adverse impact on the world economy.”

“7] When there isn’t enough crude oil to go around, the naive belief is that oil prices will rise and either more oil will be found, or substitutes will take its place. In fact, the result may be conflict and elimination of segments of the economy.”

“[8] Countries that are major importers of crude oil and crude oil products would seem to be at significant risk of reduced supply if there is not enough crude oil to go around.”

“[9] Conclusion: We are likely entering a period of conflict and confusion because of the way the world’s self-organizing economy behaves when there is an inadequate supply of crude oil.“

IF GAIL HAS THIS RIGHT, WE’RE HEADED FOR A MELTDOWN. BUT HOW MANY ARE EVEN AWARE OF THIS?

A TINY MINORITY.

CORRECT. WE’RE SLEEPWALKING THROUGH A MINEFIELD.