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A Solemn Pause | William Howard Kunstler
James Howard Kunstler
James Howard Kunstler -- World News Trust
Jan. 19, 2015
Events are moving faster than brains now.
Isnt it marvelous that gasoline at the pump is a buck cheaper than it was a year ago? A lot of short-sighted idiots are celebrating, unaware that the low oil price is destroying the capacity to deliver future oil at any price.
The shale oil wells in North Dakota and Texas, the Tar Sand operations of Alberta, and the deep-water rigs here and abroad just dont pencil-out economically at $45-a-barrel. So the shale oil wells that are up-and-running will produce for a year and there will be no new ones drilled when they peter out which is at least 50 percent the first year and all gone after four years.
Anyway, the financial structure of the shale play was suicidal from the get-go. You finance the drilling and fracking with high-yield junk bonds, that is, money borrowed from investors. You drill like mad and you produce a lot of oil, but even at $105-a-barrel you cant make profit, meaning you cant really pay back the investors who loaned you all that money, a lot of it obtained via Too Big To Fail bank carry-trades, levered-up on margin, which allowed said investors to pretend they were risking more money than they had. And then all those levered-up investments i.e. bets get hedged in a ghostly underworld of unregulated derivatives contracts that pretend to act as insurance against bad bets with funny money, but in reality can never pay out because the money is not there (and never was.) And then come the margin calls. Uh Oh .
In short, enjoy the $2.50-a-gallon fill-ups while you can, grasshoppers, because when the current crop of fast-depleting shale oil wells dries up, that will be all she wrote.
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http://worldnewstrust.com/a-solemn-pause-william-howard-kunstler
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A Solemn Pause | William Howard Kunstler (Original Post)
Tace
Jan 2015
OP
Astrad
(466 posts)1. Kunstler on Y2K
Writing this in April of 99, I believe that we are in for a serious event. Systems will fail, crash, seize up, cease to function. Not all systems, maybe only a fraction, but enough, and enough interdependent systems to affect many other systems. Y2K is real. Y2K is going to rock our world.
People will consequently suffer. I dont know how much. Some people may lose their lives - but more likely at the hands of a disabled medical establishment than because of civil disorder, loss of power, starvation, bad water, or other projected horrors (though these, too, are possible). Some will suffer the loss of fortunes, some of any income whatsoever, and many of something in between. Quite a few will find themselves suddenly without an occupation, and few ideas about how to make themselves useful to other people (without occupations themselves). Many will suffer a loss of comfort and modern convenience, and if that goes on any longer than a week, it may escalate into serious problems of public sanitation and infectious disease.
People will consequently suffer. I dont know how much. Some people may lose their lives - but more likely at the hands of a disabled medical establishment than because of civil disorder, loss of power, starvation, bad water, or other projected horrors (though these, too, are possible). Some will suffer the loss of fortunes, some of any income whatsoever, and many of something in between. Quite a few will find themselves suddenly without an occupation, and few ideas about how to make themselves useful to other people (without occupations themselves). Many will suffer a loss of comfort and modern convenience, and if that goes on any longer than a week, it may escalate into serious problems of public sanitation and infectious disease.
So take him with a big grain of salt.
http://kunstler.com/mags_y2k.html
SheilaT
(23,156 posts)2. What Astrad said.
Kunstler has written some very good novels, which I recommend, but I think he takes himself far too seriously as a prophet.
The tipping point for that will come with the inevitable destabilizing of Saudi Arabia, which I believe will happen this year when King Abdullah ibn Abdilaziz, 91, son of Ibn Saud, departs his intensive care throne for the glorious Jannah of virgins and feasts
Isn't it wonderful that he's privy to the upcoming death of King Abdullah?
I hadn't paid attention to his being one of the forecasters of total doom when Y2K was going to happen, but I spent years shaking my head in frustration at the idiocy some people believed. While I wasn't a computer programmer myself, I'd had jobs where computers were important, so I just had a very strong feeling airplanes weren't going to fall out of the sky, and all electricity fail, which were among the predictions.
Tace
(6,800 posts)3. SheilaT: King Abdullah Dies at 90
http://www.nytimes.com/2015/01/23/world/middleeast/king-abdullah-who-nudged-saudi-arabia-forward-dies-at-90.html
SheilaT: I certainly understand your skepticism regarding Kunstler, yet he was correct about this. --Tace
SheilaT: I certainly understand your skepticism regarding Kunstler, yet he was correct about this. --Tace
SheilaT
(23,156 posts)4. Yes, I saw that.
We'll wait and see how right he is about Saudi Arabia destabilizing. I'll admit I don't know a great deal about that country, other than the incredible repressiveness of the theocracy. Come to think of it, all theocracies are repressive. And Kunstler writes about them in his novels.