[MonteQuest]

$this->bbcode_second_pass_quote('shortonoil', ' ')The world is now in a deflationary spiral from which there can be no escape.

[MonteQuest]

$this->bbcode_second_pass_quote('dolanbaker', 'T')he question has to be, "how long before the reinvestment in shale oil brings results?"

[onlooker]

Yes and the problem is more lending and QE is just making things worse now rather than better in a planet totally debt saturated.

[Cog]

There are an infinite amount of games yet to be played with debt. Debt is not going to crash the world economy.

[onlooker]

$this->bbcode_second_pass_quote('Cog', 'T')here are an infinite amount of games yet to be played with debt. Debt is not going to crash the world economy.

[dolanbaker]

$this->bbcode_second_pass_quote('MonteQuest', '')$this->bbcode_second_pass_quote('dolanbaker', 'T')he question has to be, "how long before the reinvestment in shale oil brings results?"

[dolanbaker]

$this->bbcode_second_pass_quote('onlooker', 'Y')es and the problem is more lending and QE is just making things worse now rather than better in a planet totally debt saturated.

[onlooker]

Yes and that is the interesting part of all this. For much longer will everyone put value to this funny money that is not backed up by anything at all? That is the 64 million dollar question. Also, at what point can different entities continue to service the debt?

[dolanbaker]

The little guys, us the 99.5% who don't have a seat at the top table will continue to pay as defaulting is painful.
The top .5% will do deals and magic away the debts or pass it down to the rest of us like they did the last time.

[Ibon]

$this->bbcode_second_pass_quote('dolanbaker', 'T')he little guys, us the 99.5% who don't have a seat at the top table will continue to pay as defaulting is painful.
The top .5% will do deals and magic away the debts or pass it down to the rest of us like they did the last time.

[Tanada]

$this->bbcode_second_pass_quote('Ibon', '')$this->bbcode_second_pass_quote('dolanbaker', 'T')he little guys, us the 99.5% who don't have a seat at the top table will continue to pay as defaulting is painful.
The top .5% will do deals and magic away the debts or pass it down to the rest of us like they did the last time.

[onlooker]

Yes but Barter still has some physical connection to a tangible asset or tangible skill set. Money is more akin to your reference to hope and fear. Thus my point at what point will the faith in paper/digitized money hold as its nominal value becomes more disconnected with tangible assets and honest bookkeeping. We are hearing more and more how entities are fudging this honest bookkeeping.

[Tanada]

$this->bbcode_second_pass_quote('onlooker', 'Y')es but Barter still has some physical connection to a tangible asset or tangible skill set. Money is more akin to your reference to hope and fear. Thus my point at what point will the faith in paper/digitized money hold as its nominal value becomes more disconnected with tangible assets and honest bookkeeping. We are hearing more and more how entities are fudging this honest bookkeeping.

[Newfie]

As I said above, I've no idea if this is the great contraction. I kinda think not, or maybe just the first flutters of the downward yo yo.

A couple of comments.

1. For those who believe in TPTB please explaine to me how and why they are causing this to happen. What is their gain?

2. I'll offer a possible, non TPTB explanation. Our financial system is based on trust and fear as Tanda said above. Part of that trust is that there is a balance in the system. Changes can be made, but slowly, so that the players can adjust. No wild movements. Yet in the past few years we have had events that have destabilized the balance. Notably that in the face of a mildish global recession the oil producers did not adjust supply (US actions are notable, if not explainable) causing a rather large, undesired shift in the balance. It's not so much TPTB guiding the global economy as various short sighted and parochial investors grabbing for too much. Think of someone jumping from one side of a rowboat to another, it gets out of balance. "Don't rock the boat."

I can see why SA doesn't want to slow production, they need the money. That might be true for many producers. Kind of hard to explain US actions in the face of this: gas, fracking, export ban, Iran trade restrictions lifting. It all rocks the boat. With oil so cheap it ripples through the global economy. Cheap oil takes money out of circulation. I spend $30 to fill up, not $70. That $40 not going to the gas station, his workers, the supplier, their works, etc.

What is needed is to tighten the oil supply, to increase costs, to balance the boat. This is why I fear we may be on the cusp of war in the ME.

[Cog]

But that $40 you were going to spend at the gas station gets spent in other parts of the economy. So its a wash.

[Newfie]

$this->bbcode_second_pass_quote('Cog', 'B')ut that $40 you were going to spend at the gas station gets spent in other parts of the economy. So its a wash.

[MonteQuest]

$this->bbcode_second_pass_quote('Cog', 'T')here are an infinite amount of games yet to be played with debt. Debt is not going to crash the world economy.

[shortonoil]

"I wish someone would bank some of shortonoil's specific predictions so we can call him to task on them if they turn out to be bogus."

We already do that; what is the use of running a Model if it is not tested? So far we have 17 hits out of 19. The two that failed taught us that intuition, and the opinion of someone else usually sucks. We have not yet statistically fallen out of the ±4.5% margin of error for the Model. If we do we will let you know.

Oh yea, weren't you the one who was telling everyone how great the shale revolution was for the economy? How did that work out?

http://www.thehillsgroup.org/

[MonteQuest]

$this->bbcode_second_pass_quote('dolanbaker', 'G')iven a choice between watching the economy tank due to diminishing oil supply or firing up the presses to magic the funds needed to invest and restore supply, it's a no brainer.

[ennui2]

$this->bbcode_second_pass_quote('shortonoil', '
')Oh yea, weren't you the one who was telling everyone how great the shale revolution was for the economy? How did that work out?