PeakOil is You
So what's going to happen when spare capacity runs out?
Re: So what's going to happen when spare capacity runs out?
by SeaGypsy » Tue 17 Jan 2012, 08:43:17
Man oh, do you get peak oil or not? If Germany wants precrash growth back in the Euro, it had best nuke the biggest 45 cities elswhere. Or somesuch clever bomd. Du Hast Nich?
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Re: So what's going to happen when spare capacity runs out?
by Corella » Tue 17 Jan 2012, 09:05:43
Suicide for fear of exitus?
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Re: So what's going to happen when spare capacity runs out?
by SeaGypsy » Tue 17 Jan 2012, 09:39:59
Read the CoC dude. 
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Re: So what's going to happen when spare capacity runs out?
by Pops » Tue 17 Jan 2012, 10:06:00
$this->bbcode_second_pass_quote('no_wuckin_ferries_mate', 'T')he oil price is solely depending on the affordability of the poorest market participant.
But you left out the main factor behind all of this, the population of market participants is expanding and even more importantly, while the average person in the US "needs" 3 gallons of oil per day to get by, the average OECD "person" only uses 1.4 to survive and the average non-OECDer only requires a mere .02 gallons to carry on.
Lets say pumping water for your village is where your .02 gallons is spent. Although you and probably your entire village are poorer than one American, I'm gonna say you'll spend as much as you need to buy a gallon of diesel to run the pump, because otherwise you die. The American will be outbid for the gallon required to cruise to the mall and carpool, it's happening already.
A little extreme maybe, but the point being globalization has increased the pool of poor participants greatly and they will outbid the richer because their uses for oil are simply more valuable. The flattening will ripple across the economy until eventually all users will be pretty efficient.
The legitimate object of government, is to do for a community of people, whatever they need to have done, but can not do, at all, or can not, so well do, for themselves -- in their separate, and individual capacities.
-- Abraham Lincoln, Fragment on Government (July 1, 1854)
-- Abraham Lincoln, Fragment on Government (July 1, 1854)
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Re: So what's going to happen when spare capacity runs out?
by Mesuge » Tue 17 Jan 2012, 10:21:27
Lets brake it down to regions. In continetal Europe major upheavel as diesel is no longer available on gas stations for free/unlimited individual (frivolous) consumption. It's rationed for food security(agro) and police-military purposes. In response some specific sub regions hop on bicycles and public transport en masse, others convert massively cars into CNG/LPG.
The richest countries are those with only 25-35% young/graduate unemployment, the south (formely PIIGS) turned into predominantely hard authoritarian rule again, due financial market freeze up, their industries (assembly lines for the north) go belly up, revert to agriculture, not very successfull at that either (overpop and GW effects).
Northern countries had to prioritize their social contract, hence strict border patrols enacted as sort of new wall against "the barbarians" this time it also serves against refugees from former EU member friendly countries, not only migrants from Africa, ME, Central Asia.
The richest countries are those with only 25-35% young/graduate unemployment, the south (formely PIIGS) turned into predominantely hard authoritarian rule again, due financial market freeze up, their industries (assembly lines for the north) go belly up, revert to agriculture, not very successfull at that either (overpop and GW effects).
Northern countries had to prioritize their social contract, hence strict border patrols enacted as sort of new wall against "the barbarians" this time it also serves against refugees from former EU member friendly countries, not only migrants from Africa, ME, Central Asia.
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Re: So what's going to happen when spare capacity runs out?
by Corella » Tue 17 Jan 2012, 10:57:20
A certain vision out of the Quick-scenario-drawer...
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Re: So what's going to happen when spare capacity runs out?
by GoIllini » Tue 24 Jan 2012, 12:51:15
$this->bbcode_second_pass_quote('mmasters', 'I')n the next few years when the spare capacity runs dry (which it will I dont' think anybody here questions it), other than the obvious oil spike and shortages what exactly is going to happen next? a private nationalization of the oil markets? an acknowledged energy crisis with global rationings? more war? the 1970s all over again? What?
Well, we ran out of spare capacity in 2005. What happens is that oil prices go up to force people out of the market. When gasoline hits $5/gallon, you'll probably start thinking about taking the bus to work. When gasoline hits $10/gallon, we'll think about telecommuting or running our cars and trucks on natural gas.
That's the beauty of a free-market. We never run out of spare capacity, but some folks get forced out of the gasoline market. I live in a big city. We get most of our stuff shipped here by rail or by boat. When you're paying $5/box for lean cuisine dinners ($3 being for real-estate and $0.30 being for shipping), you don't feel a doubling of energy costs that much. When oil prices get high enough, more people who do not need to work there will move from the suburbs or countryside to the city. Some people will be forced out of having kids and we may see the population shrink over the long term. But the US has enough resources, enough margins on its agricultural productivity and food security, and enough infrastructure that we will largely be ok even if not just oil but all fossil fuels get expensive. We have railroads with electric wires, we have nuclear reactors, we have dams, we have wind turbines; we have horses and steel plows. All of these would help keep us limping along if everything else disappeared tomorrow.
$this->bbcode_second_pass_quote('', 'B')ut you left out the main factor behind all of this, the population of market participants is expanding and even more importantly, while the average person in the US "needs" 3 gallons of oil per day to get by, the average OECD "person" only uses 1.4 to survive and the average non-OECDer only requires a mere .02 gallons to carry on.
Pops, how much money and credit does that village of, say, 50 people have? Maybe $300/person x 50= $15000?
A middle-class family has much more access to credit than that. Indeed, we're already seeing a lot of these situations in the US. In 2008, when gasoline hit $5/gallon and single mothers were struggling to drive their kids to school, my boss bought a boat that had a fuel economy measured in gallons per mile. The fact that somebody gets much more utility out of something than you do doesn't mean that they can afford to spend more money than you.
If folks think it's tough to be middle-class in the US, imagine how people in Africa feel.
The beauty- and tragedy- of capitalism is that we don't all get the same 2 gallon bucket of gasoline every morning. Some people get more and some people get less. It's not fair, but a reduction in oil production doesn't spell doom for everyone the same way it would under a totalitarian economic system where everyone is forced to share.
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