$100 never again

72 Comments on "$100 never again"

makati1 on Thu, 10th Dec 2015 7:02 pm 



What a pile of bullshit from Yayhooo! Always “lower oil prices will save…” Not if they are losing their jobs, are not car owners, use electric for their home heating, etc. It may make a bit of a difference for a small percentage of consumers, but not the majority.

If lower is good, bring on $20 oil or even $10 oil. That should be fantastic for the American consumer … until the crash. LOL

Pete Bauer on Thu, 10th Dec 2015 8:40 pm 



We should have a recording of this and when the prices hit $100 / barrel, we should show it to him.

No one can predict the price of oil. Chinese vehicle sales are zooming.

Luckily their electric vehicle sales are also increasing.

eugene on Thu, 10th Dec 2015 8:52 pm 



An extra $7-800 a yr will, certainly, put me on the path to wealth and happiness. Who thinks up this shit?

Plantagenet on Thu, 10th Dec 2015 9:11 pm 



Once the sanctions on Iranian oil exports are ended, look for the oil glut to get even worse.

makati1 on Thu, 10th Dec 2015 10:18 pm 



Pete, maybe no one can predict the price of oil, but the world economy cannot support $100 oil for more than a short time before it all crashes. Only those deeply invested in oil cannot seem to see that fact. It must be getting more and more difficult to keep a positive mind about the future of oil prices.

makati1 on Thu, 10th Dec 2015 10:20 pm 



Eugene, maybe you can use it to help pay for the increase in your Obomination health care? Or to buy a Geiger counter to check your food and water? ^_^

twocats on Thu, 10th Dec 2015 11:32 pm 



even his downside prediction could easily be wrong – “I don’t see it dropping below $30” Of course you don’t, that would mean we were in a global deflationary crises, which is exactly what we are tip-toeing along the edge of. I mean the fed says they’re gonna raise rates. If they do then won’t that strengthen the dollar and make gas cheaper? If they don’t, then doesn’t that mean the economy is in the shitter and shatter the demand side? It could easily go below $30 for a few months. Again, what country is gonna fall on that sword and say, you know what, for the good of oil prices everywhere – I’ll cut production. I guess that was OPEC’s job back in the day. Thought US was the swing producer? Swinging-dick is more like it.

ennui2 on Fri, 11th Dec 2015 12:32 am 



“that would mean we were in a global deflationary crises”

Or….it could mean we’re in an oil glut, like the article says. Man, peakers don’t want to just accept the facts.

Boat on Fri, 11th Dec 2015 1:46 am 



Our home has 4 wage earners and 4 vehicles. If you compare gasoline at its high $3.80 th the current $1.86 we figure to save at least $4,000. That’s not chump change.

Who knows what farmers will save. The big box stores. Truck drivers or the companies they work for. Your crazy if you think this this is not a huge impact.

twocats on Fri, 11th Dec 2015 1:46 am 



hate to break it to you ennui, but deflationary events are characterized by an oversupply… of just about everything. The entire commodity complex is in serious decay and outside of a few mega-corporations earnings and revenues are hurting big time. If it was just a supply glut these other things wouldn’t be happening simultaneously. The recessionary signals are too many to actually list.

meld on Fri, 11th Dec 2015 2:34 am 



So effectively the price of oil will keep going down until lots of companies go out of business, trigger a financial crisis and then once the glut is all used up we’ll have insanely high prices.

Davy on Fri, 11th Dec 2015 4:15 am 



Pete, a quick google will paint a different picture than “zooming” car sales in China. The trend is down will it continue is debatable but the conditions for increasing growth are not good.

“China Car Sales Driven Lower by Slowing Economy
Sales fall for third month in a row”

http://www.wsj.com/articles/china-car-sales-driven-lower-by-slowing-economy-1441869976

BEIJING—China’s new-car sales fell for the third straight month in August amid sluggish demand fed by economic slowdown and slumping stock prices.

Passenger car sales slipped 3.4% to 1.42 million vehicles last month, following a 6.6% decline in July and a 3.4% fall in June. Combined sales of passenger and commercial vehicles fell 3% in August to about 1.66 million vehicles, the government-backed China Association of Automobile Manufacturers said Thursday.

Davy on Fri, 11th Dec 2015 4:35 am 



Ennui, can you tell me if we transcended the business cycle? After so many years of reported growth how long until a recession. It is almost as if the cornucopians are unable to contemplate recession. Recession is a “N” word for them. Recessions are supposed to be a healthy dip in a longer term trend of growth. Recessions are supposed to purge the excesses. Unfortunately everyone understands we are seeing a compression of the fundamental because of debt, central bank repression, and global easing. Recessions are now terrifying because of broad based debt and systematic contagion dangers.
The oil supply instability is the product of multiple factors. Oil is not a good economic indicator. Two Cats summed up the commodity super cycle that burst. Major emerging market nations have suffered because of this. Check out Brazil, Russia, and Canada for a hint at what happens when demand drops for important commodities either in price or consumption. It is just a matter of time before the US markets drop. US equity markets have a profound impact on confidence and consumption globally. This drop will be influenced by the normal business cycle. This is unavoidable and we are nearing a normal recessionary timeframe per historic cycles. This cycle has been distorted and repressed by central banks making the outcome more unpredictable and worrisome.

charmcitysking on Fri, 11th Dec 2015 5:15 am 



ennui2 on Fri, 11th Dec 2015 12:32 am

“that would mean we were in a global deflationary crises”

Or….it could mean we’re in an oil glut, like the article says. Man, peakers don’t want to just accept the facts

———

*crickets chirping*

Davy on Fri, 11th Dec 2015 5:45 am 



Does this point to “everything is fine” narrative. The big question is are these actions a coordinated effort by the major powers to move the global economy into position for the fed to raise rates?

“China ‘Stealth’ Devaluation Continues – Yuan Plunges For 6th Day, Default Risk Soars, Fosun Bonds Crash”

http://www.zerohedge.com/news/2015-12-10/china-stealth-devaluation-continues-yuan-plunges-6th-day-default-risk-soars-fosun-bo

“USDCNY broke above 6.4500 for the first time since the August devaluation, extending its post-IMF plunge to 6 days. This is the largest and longest streak of weakness since March 2014 as China seems to have taken the SDR-inclusion as blessing to devalue its currency drip by drip. Default risk is once again stomping higher as CDS surge from 94bps to 112bps (2-month highs).”

adonis on Fri, 11th Dec 2015 6:04 am 



The price of a barrel is just like a countdown everyday I look its getting lower and lower what happens when it reaches zero?

makati1 on Fri, 11th Dec 2015 8:14 am 



adonis, according to the author it should be Paradise in the US. LOL

ERRATA on Fri, 11th Dec 2015 8:41 am 



Will the US for the purposes of economic warfare do not subsidize more and more oil ?? (quietly subsidize oil)
In the US people do not know the Communist payment system (maybe ??) so even over not discuss (I think.)

In Soviet economic area payment scheme (principle of cheap energy) led to energy waste and inefficiency. 30 years ago it was condemned and criticized, and now to come back?

Outcast_Searcher on Fri, 11th Dec 2015 9:25 am 



You have to love the economic short term doom slanted distortionist postings of the doomers like Davy.

It’s mid December Davy. If you want to look at Chinese auto sales, why pick the end month of August? Because it tells the tale you want to see?

Chinese auto sales are rising lately, not falling. http://www.statista.com/statistics/276899/automobile-sales-in-china-by-month

In July, consumer auto sales in China were well below 1.3 million. They increased significantly in August, September, and October. In October, they were well over 1.9 million.

That’s about a 50% increase in three months. Just the opposite of what Davy is claiming. Using later data and a “quick Google” by the way.

When you use quotes behind a pay wall, they’re not exactly easy for folks to check out, by the way.

Outcast_Searcher on Fri, 11th Dec 2015 9:31 am 



Boat is exactly right. So far the stress on the oil industry probably has roughly canceled out the positive effect from much lower oil prices for business and consumers.

However, over time, unless we have a rapid return to much higher prices, the cumulative effect on the economy of all those savings will be very positive.

And the economy doesn’t care overall in the longer term if weak companies have to sell their holdings to stronger hands — hands that will produce that oil when the oil price escalates down the road.

Outcast_Searcher on Fri, 11th Dec 2015 9:37 am 



Oh, and I just found the November sales in China. As I thought I remembered, they were extremely strong, surging to 2.2 million passenger vehicles, 23.7% above the figure from a year ago.

http://news.yahoo.com/chinas-november-auto-sales-accelerate-081132834.html

How is this a short term economic collapse signal, to anyone with a more balanced perspective than, say, zerohedge?

(I’m not saying zerohedge is never right, but their overall batting average is PITIFUL).

GregT on Fri, 11th Dec 2015 10:07 am 



“However, over time, unless we have a rapid return to much higher prices, the cumulative effect on the economy of all those savings will be very positive.”

All of those savings are being wiped out by the spread between the real rate of inflation, and interest rates. Interest rates have been historically lowered in an attempt to “stimulate” the economy. It isn’t working because of the inherent need for exponential growth in our financial ponzi-schemed systems, and the fact that oil prices are still in historical recessionary territory. It isn’t only ‘weak companies’ that are being wiped out, it is institutional investors such as hedge and pension funds, governments’ abilities to pay down debt, and everybody else’s savings.

The only things that have really changed since 2008, is that debt loads have increased substantially, and huge bubbles have been blown in the markets due to cheap credit. If/when oil prices escalate down the road, 2008 will be repeated all over again. Except for the next time it will be exponentially worse. You can’t spend your way out of a debt crisis.

marmico on Fri, 11th Dec 2015 10:19 am 



The only things that have really changed since 2008, is that debt loads have increased substantially

ROTFLMFAO

U.S. Household Debt to GDP

U.S. Household Debt Obligations

apneaman on Fri, 11th Dec 2015 10:19 am 



Outcast_Searcher, if I was looking for a balanced and accurate view, the last thing I would trust would be official Chinese economic numbers. They are even bigger liars and spin Dr’s than the US (been at it longer). I’ll never understand why some people feel a need to put all their faith and trust in authority. Maybe it’s a brain wiring thing. BTW it ain’t going to be short team this time (there’s no recovery from terminal cancer), but you go ahead and keep the faith. Whatever soothes your anxieties.

China’s GDP at 6.9%? Try 3%: Analysts react to latest growth figures

http://www.marketwatch.com/story/chinas-gdp-at-69-try-3-analysts-react-to-latest-growth-figures-2015-10-19

For All Its Heft, China’s Economy Is a Black Box
China’s economy is difficult to assess amid murky politics, unreliable data and opaque decision making

http://www.wsj.com/articles/for-all-its-heft-chinas-economy-is-a-black-box-1440467253

China’s Economy Is Worse Than You Think

“Growth has become almost a religion in China, and is now one of the Communist Party’s main sources of popular legitimacy. If Chinese people lose their jobs, they may attribute it to a local slowdown or the failure of their own employer — but if the national numbers go down, they may believe that the people at the top have tanked the economy. That could be dangerous for political stability.

Additionally, China’s leaders have an incentive to keep capital flowing into the country in the form of foreign direct investment, and to prevent capital outflows. That means heading off any incipient sign of panic. Economic number-fudging is a cheap way to prevent jittery investors from making a stampede for the exits.”

http://www.bloombergview.com/articles/2015-11-03/china-s-slump-might-be-much-worse-than-we-thought

apneaman on Fri, 11th Dec 2015 10:22 am 



marmico, I’ve noticed that since BC has stopped coming around you have crawled out from under your rock a lot more. Feeling braver now are we?

GregT on Fri, 11th Dec 2015 10:32 am 



GDP is not a true indicator of economic well being Marmi. Everything from natural disasters to the criminal justice system are included in those numbers. But you already knew that. You may act dumb, but it’s hard to believe that you could actually be completely brain dead.

US household debt obligations are obviously much less due to ZIRP. Again, you can’t spend your way out of debt. Which is what the CBs have in essence attempted to do by lowering interest rates.

Outcast_Searcher on Fri, 11th Dec 2015 10:32 am 



GregT said:

“All of those savings are being wiped out by the spread between the real rate of inflation, and interest rates.”

Well no, they’re not. For example, in 2015, the US inflation rate is almost zero.

http://www.usinflationcalculator.com/inflation/current-inflation-rates/

For the US the actual rate of inflation (according to many credible sources, not zerohedge, etc.) is well below the 2% Fed goal, and has been for years. So you have a spread between interest rates (zero) and the actual rate of inflation of well below 2%.

There has historically been some slippage there (inflation higher than money market rates, and money market interest was typically taxed), so it’s not like this is a big deal recently compared to, say, the past 45 years (when I was old enough to notice).

Long term, paper currencies all inevitably lose a LOT of value, so people with money and brains invest that money for the long term.

Long term, the US stock market has had a roughly 7% real (after inflation) return, which means your invested money would roughly double in value each decade. Obviously there are good and bad decades and interest rates gyrate, but if one stays the course over several decades, these things even out on average.

I’d hardly call a 7%ish real return over the long run a catastrophe. I would call holding cash in a mattress over the same time interval an economic catastrophe. The solution is obviously — don’t do that.

Davy on Fri, 11th Dec 2015 10:41 am 



Outcast, you don’t like me I can tell but if you look at my reference my numbers were from WSJ not ZH. One or two months increase does not make an argument. My reference was in regards to dubious “zooming” description by by Pete. My point is it is more like struggling auto sales. You might want to throughly reality test your comment/attacks accordingly. It makes you look sloppy.

rockman on Fri, 11th Dec 2015 10:42 am 



mak – “adonis, according to the author it should be Paradise in the US.”. Actually if the price of oil got low enough (which it never could) there would be great havoc in the world because there would be an immediate SHORTAGE of oil. IOW at a low enough price there would be more potential buyers then all the oil producers could deliver at their max rate. At that point govts would have to allocate oil to the buyers on some basis they dictate.

Of course oil can’t get that low because as soon as there are more buyers that can afford the current price then there is oil available the sellers would be able to raise prices. Which, by definition, would be the bottom of the oil price floor we’re heading towards. It won’t be an instantons reset since it takes economies a while to adjust to new prices. But eventually capable buyers won’t get access to what they need and will start bidding up prices at least to the max level they can afford.

Davy on Fri, 11th Dec 2015 10:47 am 



Outcast, you are barking up the wrong tree if you expect us to believe your sources are credible. Who is credible today? Most sources are in the spin business including you. You are playing a marmi and throwing around a lot of fluff. Have fun trying to be a tough guy you are a minority. Stick around and we will educate you or you will become an obnoxious like marmi. Likely you will move on like most of the fly-by-night corns we have drop in.

GregT on Fri, 11th Dec 2015 10:50 am 



I guess it all depends on who you believe. According to shadow-stats the real US inflation rate is ~ 4%.

http://www.shadowstats.com/alternate_data/inflation-charts

If You Want To Know The Real Rate Of Inflation, Don’t Bother With The CPI

“Common sense tells us the Consumer Price Index is not an adequate measure of inflation. For the second year in a row the Consumer Price Index for All Urban Consumers (CPI-U) remained under 2 percent. On average, consumer prices increased 1.5 percent, according to the government. However, the government has incentives to keep this statistic as low as possible. In fact, the CPI doesn’t even measure inflation, rather a range of consumer spending behaviours.”

http://www.forbes.com/sites/perianneboring/2014/02/03/if-you-want-to-know-the-real-rate-of-inflation-dont-bother-with-the-cpi/

The following is difficult to ignore, although some still seem to do so.

http://www.usdebtclock.org

GregT on Fri, 11th Dec 2015 11:00 am 



And also Outcast;

“I’d hardly call a 7%ish real return over the long run a catastrophe.”

Just like when you’re playing craps in Vegas, there is no ‘real return’ until you cash out. If everybody cashed out of the market, they would quickly understand how much their ‘real returns’ are. The market has been artificially inflated due to QE and zero interest rate policies. The market is in the mother of all bubbles. (MOAB)

Boat on Fri, 11th Dec 2015 11:00 am 



apneaman
marmico, I’ve noticed that since BC has stopped coming around you have crawled out from under your rock a lot more. Feeling braver now are we?

BC I am sure was killed by the world wide crash which he predicted would be completed in about 3 weeks. Or maybe he is holed up in a grocery store. Look out Your doors. There shouldn’t be any gasoline left to drive. No businesses should be running. No jobs left to go to.
Maybe BC is just to embarrassed because his prediction was wrong. I mean really wrong.
Which of you other doomers want to take his place and put a date on the world crash.

GregT on Fri, 11th Dec 2015 11:10 am 



The crash is a process Boat, not a moment in time. For billions of people around the world the crash has already happened.

Your turn will come soon enough.

apneaman on Fri, 11th Dec 2015 11:12 am 



Boat, again, if you are making ‘he said’ claims we need the link to the quote otherwise it’s hearsay. You tend to read something then run it through your PVC fume infused brain filters and spit it out the other side as something completely different. Let us see his actual prediction in his own words. Did you not say you were taking notes and saving links to these predictions?

Boat, again…..

Quotation Marks

The rules set forth in this section are customary in the United States. Great Britain and other countries in the Commonwealth of Nations are governed by quite different conventions. Nowhere is this more apparent than in Rule 3a in this section, a rule that has the advantage of being far simpler than Britain’s and the disadvantage of being far less logical.

Rule 1. Use double quotation marks to set off a direct (word-for-word) quotation.

Correct: “I hope you will be here,” he said.
Incorrect: He said that he “hoped I would be there.” (The quotation marks are incorrect because hoped I would be there does not state the speaker’s exact words.)

http://www.grammarbook.com/punctuation/quotes.asp

GregT on Fri, 11th Dec 2015 11:17 am 



The most intelligent thing that you can do for yourself in the meantime Boat, is to play the casino instead of paying down your debt.

History is very clear on that. 🙂

Boat on Fri, 11th Dec 2015 11:30 am 



apeman,

BC stated the crash was imminent. I asked what time frame. He stated from now to total crash in six months. Well six months is almost up. There is no crash. Period.
I have only copied one comment by short because he did make a prediction.

shortonoil on Sun, 6th Dec 2015 7:21 pm

In three, or four years at best oil will be $30/ barrel, and huge pieces of the oil industry will be going out of existence. Huge pieces of the world’s economy will be going with it. They’ll be stoking up the old coal furnace then, or freezing in the dark. Humanity will destroy it, long before they save it.

His idea that he keeps preaching that depletion will drive prices lower is crazy IMO and his 3-4 time frame is a fair enough period to wait. When demand catches up with oil production and prices rise will be proof enough for me to know he is wrong PHD or not.
As I asked, if you want me to track a few predictions I will be willing to do it. Meanwhile my money is where my mouth is, in the market dollar cost averaging.

Boat on Fri, 11th Dec 2015 11:36 am 



GregT,
The crash is a process Boat, not a moment in time. For billions of people around the world the crash has already happened.

Thats an easy comment to make with no time line. But it allows you to blather on with your 1/2 truths and conspiracy theories. Grow some balls. You think your an expert. Give me your gut feeling on the crash time line.
I do every day. I look out 10 years and say the world will muddle through like it always has.

GregT on Fri, 11th Dec 2015 11:43 am 



“In three, or four years at best oil will be $30/ barrel, and huge pieces of the oil industry will be going out of existence. Huge pieces of the world’s economy will be going with it. ”

What part of this prediction do you find to be incorrect Boat? WTI at the moment has dropped to $35 and change. Huge pieces of the oil industry are already losing their shirts, and economies continue to unravel round the globe. Much sooner than three, or four years.

“Meanwhile my money is where my mouth is, in the market dollar cost averaging.”

Just another way of saying you’re losing money Boat, and taking a gamble that things will turn around. You are going to lose your shirt Boat, and your house. You have been repeatedly warned.

Boat on Fri, 11th Dec 2015 11:45 am 



I want to thank the Canadian boys for their concern about my grammar skills. Working a lifetime in factories I had little to no use for them. In the 5th grade I decided grammar was a waste of time and have been proven right by my life experience. In fact working in factories I learned to drop much of my vocabulary when explaining and training. It’s just more efficient talking plain.
But I understand the need to lash out by insecure commenters. So keep at it. Lol

GregT on Fri, 11th Dec 2015 11:49 am 



Your grammar skills reflect your level of intelligence Boat. No excuses are necessary.

Boat on Fri, 11th Dec 2015 11:52 am 



GregT,
Huge pieces of the world’s economy will be going with it.
This is where I am at odds with the doomers.
There is plenty of oil. Even if the world continues to grow there will be plenty of oil.
As I have commented repeatedly, currently, Cheaper to develop oil is simply replacing more expensive to develop oil. The global economy will be fine.

Boat on Fri, 11th Dec 2015 11:59 am 



GregT,
Were gonna find out now aren’t we. When the crash doesn’t’ happen and oil goes back up and the world keeps chugging along I will be here to remind all you degreed, intelligent doomers that you were wrong.

apneaman on Fri, 11th Dec 2015 12:25 pm 



Boat, I dropped out of school in grade 9 to go work in the bush. Even in that environment we used more than grunts to communicate. Sounds like in the 5th grade all you decided was that it was too hard for you so you gave up. Choose not to do the work. Similar to how you decide that bad news doesn’t count. The crash is already under way you fucking retard. You are just deciding to ignore it. It’s not just doomers anymore. Even the MSM is talking about it. You just can’t handle it, so you pretend.

“Everything’s Crashing”

“The Dow is down over 600 points in the last week or so, bond yields are collapsing, the US Dollar is tumbling, crude is crashing, and junk bonds are in free-fall.”

http://www.zerohedge.com/news/2015-12-11/everythings-crashing

twocats on Fri, 11th Dec 2015 12:54 pm 



Yeah, I’ll back you Boat. A lot of what you’ve said in this thread holds water. The predictions of “total collapse” have been pretty much completely wrong. I mean, SOME of it is perspective. Ask the people in Greece if the collapse is total, or just somewhat total, and you might get punched in the face. But on the whole, and in some extremely important metrics (like equities and asset prices in general) the system has done very well. I would claim that its adjusted well to peak oil and therefore only slipped here and there, while Boat might claim that these are normal dips on an otherwise upward trend. I respect that. The system as a whole has shown resilience.

Davy on Fri, 11th Dec 2015 1:00 pm 



Two cats, what is hard to understand about the word “process”? I am not claiming collapse immediately. This could drag on or it could be a sharp sudden collapse to a much lower level of economic activity. You guys can barely stomach the “r” word so how the hell will you digest collapse. Let me repeat collapse is a process just like growth is a process. The two end there with different attributes and pathways.

twocats on Fri, 11th Dec 2015 1:00 pm 



also, latest production numbers are up from Ron Patterson. Bakken up slightly, but still UP, and OPEC up 1/4 mbpd mostly from Iraq. Well, I guess we are in for a little more “lower for longer”. I think everyone was expecting another DROP in production.

twocats on Fri, 11th Dec 2015 1:05 pm 



Hey Davy. No, I apologize, I wasn’t trying to comment on anything you said in particular. In fact, most of the back and forth I see above is between Boat and GregT, but I’m not even commenting on GregT, I just looked purely at what Boat was saying, and from a rhetoric standpoint I could agree with what he’s saying. I’m a hard-core doomer, but that doesn’t mean I can’t see evidence that doesn’t support my world view.

twocats on Fri, 11th Dec 2015 1:08 pm 



as for the rhetoric of collapse, there was plenty of thought between 2003 to 2010 that sometime between 2005 and 2015 there would be a major major global crises of never before seen epic proportions. One could argue 2009 was that event, and it did have some dangerous moments, but the system adjusted, and it has survived to the present day.

Boat on Fri, 11th Dec 2015 1:24 pm 



twocats,
I have pointed out that even during the great depression 75% of the people kept working.

I have pointed out that as late as 1950’s China lost an estimated 50 million people due to famin. If those same things happened today the doomers would be screaming crash. But yet the world kept muddling along.

I agree peak oil will have it’s day and cause hardship if electric and nat gas haven’t replaced large percentages of transportation

I agree climate change will have it’s day and create an environment that replacing infrastructure will not keep up with destruction. My view is that this is still decades away.

So timing is the main argument I get caught up in.