[dirtyharry]

$this->bbcode_second_pass_quote('Yoshua', '[')img]http://www.usfunds.com/media/images/investor-alert/_2016/2016-09-23/COMM-Time-Major-Economies-Boost-Public-Infrastructure-Spending-09232016-LG.png[/img]

[shortonoil]

$this->bbcode_second_pass_quote('', 'Y')es, the question is where is the surplus nett energy to do this ? Where is the money to do this? The world is drowning in debt ,and you want more of it . Get real ^ The music is playing but the party is over ^ . Puerto Rico is not coming back and neither is Houston . Wake up.

[dcoyne78]

$this->bbcode_second_pass_quote('onlooker', '&')quot;The unnecessary bells and whistles ironically comes from economics. Put simply, we have an economic system measured in terms of money but dependent on energy and material resources. The first keeps growing through financial speculation while the latter becomes less available due to EROEI. The title thread implies that by creating more money we can reverse a downward trend in EROEI. That's not going to happen."
BRAVO!
As for being a Believer, well you all seem to easily believe the Mainstream authorities and Media. You also BELIEVE, the Etp is wrong as you are not able to interpret its more technical/mathematical formulations nor have you offered any disqualifying evidence beyond references again to the Mainstream communiques.
Then you try to convince us that Economics trumps physicis and biophysical conditions. Sorry it does not. Ultimately, economics is simply a way to measure what is happening related to resources and to allocate and distribute them in pre-planned ways. The Etp has tried to transcend this limited economic perspective and get at the status of the resource involved in this case OIL.

[dcoyne78]

$this->bbcode_second_pass_quote('shortonoil', '')$this->bbcode_second_pass_quote('', 'Y')es, the question is where is the surplus nett energy to do this ? Where is the money to do this? The world is drowning in debt ,and you want more of it . Get real ^ The music is playing but the party is over ^ . Puerto Rico is not coming back and neither is Houston . Wake up.

[onlooker]

A major shortcoming of the ETP analysis is that it looks at only a single energy source- oil.
Yes that is a fair assessment Dcoyne.
I too think that could be the weak point in the Etp. It remains to be seen how societies will fare if Oil/energy decreases dramatically and if societies can have some sort of substitutes online to cushion the blow from this eventuality. I tend though to be bearish about the outcome.

[AdamB]

$this->bbcode_second_pass_quote('onlooker', '
')On the contrary, I endeavor to stand on the firm ground of reality and truth.

[AdamB]

$this->bbcode_second_pass_quote('dcoyne78', '
')A major shortcoming of the ETP analysis is that it looks at only a single energy source- oil.

[onlooker]

$this->bbcode_second_pass_quote('AdamB', '')$this->bbcode_second_pass_quote('onlooker', '
')On the contrary, I endeavor to stand on the firm ground of reality and truth.

[asg70]

$this->bbcode_second_pass_quote('onlooker', '
')I believe if I jump off a 30 story building, I probably will die.

[dcoyne78]

$this->bbcode_second_pass_quote('onlooker', 'A') major shortcoming of the ETP analysis is that it looks at only a single energy source- oil.
Yes that is a fair assessment Dcoyne.
I too think that could be the weak point in the Etp. It remains to be seen how societies will fare if Oil/energy decreases dramatically and if societies can have some sort of substitutes online to cushion the blow from this eventuality. I tend though to be bearish about the outcome.

[shortonoil]

The cost of oil as a percentage of world GDP has been following a sinusoidal function over the last 58 years. Green squares are decade averages, red dots yearly points. The graph which was constructed from World Bank, and EIA data shows the relative ability of the economy to pay for the oil that it uses. The graph has a periodicity of 12.94 years. The graph indicates that the economy's ability to support crude production is now at $37/ barrel. The dollar denomination of crude in $/barrel is only relative in relationship to the economy's ability to pay for it.

Chart 203 supports the conclusion of the Maximum Affordability function which is solely derived from deliverable energy calculations, and the World Bank and EIA value per BTU term.

http://www.thehillsgroup.org/depletion2_022.htm

The graph also indicates that the leverage from the price of crude to the economy is closer to 40:1, as opposed the commonly applied value of 15:1. The well being of the economy appears to be much more dependent on petroleum than previously assumed.

http://www.thehillsgroup.org

[Yoshua]

Dcoyne

When the EROI of petroleum falls to 1:1 and petroleum counts for 1/3 of the energy mix, then 1/3 of the remaining energy mix would be needed as an energy source to produce petroleum.

If the EROI of the remaining energy mix falls to 2:1 then the entire energy mix would be needed as an energy source to produce petroleum.

We do need high EROI energy sources to maintain petroleum production at today's level when the EROI of petroleum falls to 1:1 or find ways to use less petroleum.

It would have been easier to make that shift a long time ago.

[marmico]

$this->bbcode_second_pass_quote('', 'C')hart 203 supports the conclusion of the Maximum Affordability function which is solely derived from deliverable energy calculations, and the World Bank and EIA value per BTU term.

[shortonoil]

$this->bbcode_second_pass_quote('', 'W')e do need high EROI energy sources to maintain petroleum production at today's level when the EROI of petroleum falls to 1:1 or find ways to use less petroleum.

[Revi]

Wow! I wonder if that's what's driving the cryptocurrencies?

[GHung]

$this->bbcode_second_pass_quote('Revi', 'W')ow! I wonder if that's what's driving the cryptocurrencies?

[onlooker]

IRRATIONAL EXUBERANCE

[Yoshua]

[/img]

[dcoyne78]

$this->bbcode_second_pass_quote('Yoshua', 'D')coyne

When the EROI of petroleum falls to 1:1 and petroleum counts for 1/3 of the energy mix, then 1/3 of the remaining energy mix would be needed as an energy source to produce petroleum.

If the EROI of the remaining energy mix falls to 2:1 then the entire energy mix would be needed as an energy source to produce petroleum.

We do need high EROI energy sources to maintain petroleum production at today's level when the EROI of petroleum falls to 1:1 or find ways to use less petroleum.

It would have been easier to make that shift a long time ago.

[dcoyne78]

Hi Shortonoil,

The World economy was doing fine when oil prices were over $100/b for 2011-2014, oil prices fell simply because there was an oversupply of oil. Your sinusoid is interesting, but without any theory for why there should be a 12-13 year cycle, it means very little. There are times when the market is undersupplied and prices increase and times when it is oversupplied and prices decrease and it is fairly random.

For the World as a whole (rather than just the US) there has not been any study that has shown with statistical significance that economic output will correlate well with the percentage of income spent on crude oil.

When we consider World GDP annual growth rate vs % of World GDP spent on oil from 1961 to 2015 there is little correlation, R squared is 0.0025. I would also note your sinusoid chart leaves off several data points where the % of GDP spent on crude was about 5% to 8% from 1979 to 1983. That does not really match your sine curve very well, where the maximum on the chart is about 4%.

gdp and oil2.gif