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Page added on May 22, 2018
This Federal Policy Enabled the Fracking Industry’s $280 Billion Loss
Most people probably aren’t familiar with the acronym ZIRP. It stands for zero interest rate policy and is the policy that unintentionally created the American fracking bubble — just one of its many consequences.
And while most people may not know much (if anything) about ZIRP or the Federal Reserve (Fed), it is likely that they are aware of the impact this policy has on their own lives.
Do you have money in your checking account? Are you lucky enough to have savings? Have you noticed how you don’t make any interest on that money and haven’t for almost 10 years?
You can thank the Fed and ZIRP for that. One of the results of the Fed’s zero interest rate policy is that the average American saver ends up with close to zero interest on their money in the bank. This is one of the reasons that ZIRP is often described as a wealth transfer from American savers to debtors. Because the shale industry is deeply in debt, these companies directly benefit from this arrangement.
Below is a chart of rates for certificates of deposit (CD) since 1980 — historically a safe investment that gave people a decent return on their savings.
Data from Bankrate.com
Since 2010, if you put your money in a CD, you would not even be keeping up with inflation due to the low interest rate. That isn’t supposed to be how it works.
And as this next chart shows, historically that hasn’t been how it works. The graph below is the federal funds rate since 1950 (this is the interest rate that banks charge each other to lend excess cash overnight). It’s very clear that starting in 2008, the chart flatlined (due to ZIRP) and stayed that way for years — something that had not happened before.
Image: Federal Reserve Bank of St. Louis
When that graph flatlined after the 2008 financial crisis, Americans’ personal savings stopped earning any meaningful interest.
ZIRP Policy Designed to Re-inflate Housing Bubble
While ZIRP has been devastating to retirees and other savers who would like to earn some interest on their money in the bank, it did manage to effectively re-inflate the housing bubble. Because even though you couldn’t earn interest on your savings over the last decade, mortgage rates have been historically low.
These low rates have kept people buying homes and refinancing. The chart below shows how ZIRP resulted in record-low interest rates for the 30-year fixed mortgage.
Image: Federal Reserve Bank of St. Louis
Once again, stories are emerging about overheated housing markets because ZIRP has gone on for so long. When it comes to the housing market, ZIRP certainly worked to re-inflate the market … and create new housing bubbles.
In response, the Fed is raising rates and promises more increases in 2018 and 2019, which has also begun to raise mortgage rates.
Bill McBride runs the economics blog Calculated Risk. He is widely acknowledged as someone who predicted the housing bubble and recovery. McBride’s track record is acknowledged in the title of this Business Insider article from 2012: The Genius Who Invented Economics Blogging Reveals How He Got Everything Right And What’s Coming Next.
McBride told DeSmog that ZIRP certainly helped the housing market. “With regards to ZIRP, the Fed’s QE [quantitative easing] policy pushed down long rates and that helped the real estate market recover,” he said.
Quantitative easing was another Fed program that helped big banks and is a tool used when interest rates are already at zero and thus can no longer be lowered.
The problem with trying to re-inflate one market is it tends to re-inflate all markets. It would be hard to argue that the stock market hasn’t been re-inflated as well by this policy. It has been on an epic run while the policy was in place.
And ZIRP has been instrumental in creating the American shale oil and gas industry and funding its epic money-losing streak during that same time period.
ZIRP Fuels Massive Borrowing in Shale Industry
There are two main ways that ZIRP has fueled the shale industry. One is that — unlike the rest of us not making money on our savings — big companies and investors have been able to borrow large amounts of money at very low rates. This is commonly referred to as “free money” during the ZIRP era because if you are paying little-to-no interest on a loan it is effectively free. This relationship was first detailed on DeSmog in 2014.
How much “free money” are we talking about? According to Helen Thompson’s book Oil and the Western Economic Crisis, the numbers are big:
“QE and ZIRP hugely increased the availability of credit to the energy sector. ZIRP allowed oil companies to borrow from banks at extremely low interest rates, with the worth of syndicated loans to the oil and gas sectors rising from $600 billion in 2006 to $1.6 trillion in 2014.”
Would you like to borrow a trillion dollars at extremely low interest rates? Sure you would. But you don’t get to — unlike the shale industry.
The second main way that ZIRP has funded the shale “revolution” is via the junk bond market. Junk bonds are bonds issued by companies — witih help from investment banks that get their cut — that have credit ratings below “investment grade.” To be an investment grade bond requires a certain level of confidence the company will pay back both the interest and principal on the bond “through good times and bad.”
Because there is a lower chance of a junk bond issuer being able to pay back interest and principal, those bonds reward investors with the promise of higher returns. If the company does well, the investors are paid well for their gamble. If not … they lose out because they invested in “junk.”
Just like the average person who is making no interest on savings, there are massive investment companies that need to provide clients with consistent returns.
There was a time when this was easy. Want a 4 percent return? Put it in a money market or CD rate that guarantees 4 percent. Done.
However, in a ZIRP environment, that isn’t an option. So investors must choose riskier assets like junk bonds to (hopefully) get a “traditional” return (aka yield), as junk bond investor Lawrence McDonald explained to CNBC:
“The market is thirsting for yield and the Fed is pushing people to do things like this. So big asset managers are reaching, reaching, reaching and companies know this and are issuing, issuing, issuing all this crap.”
“Crap.” Like junk bonds for shale oil companies that have never made money. But Wall Street keeps working with these companies to issue this “crap” and big asset managers keep buying it up, as Wolf Richter noted on Business Insider in 2015:
“Time and again, despite the collapsed prices of oil and gas, the players in the shale revolution have gotten more funding from Wall Street, whose ZIRP-blinded clients kept gobbling up the newly issued junk bonds, leveraged loans, and shares, taking on huge risks and hoping to make a little extra money in a Fed-laid minefield where all decent assets are way overpriced.”
ZIRP has been very, very good to the shale industry and Wall Street, as The Economist has noted:
“Low interest rates make it easy for shale firms to borrow, and fee-hungry banks cheer on the spectacle.”
And it is a spectacle. While the shale industry has lost over a quarter trillion dollars, it has been rewarded for this behavior.
As DeSmog explained earlier in this Finances of Fracking series, Wall Street is happy to loan cash to money-losing fracking companies because banks and investment firms make their money by making loans or selling junk bonds and collecting the fees on those deals.
Because shale companies have never made a profit, they must keep doing what they have always done — that means borrowing more money to drill more wells, which have been costing more money than they make. If shale companies stopped borrowing, they would have to either drastically reduce the amount of oil being produced, or likely have to declare bankruptcy — as many shale companies have done.
Fed Raising Rates: Is This the Beginning of the End for Shale Financing?
The Federal Reserve Building in Washington, D.C. Credit: AgnosticPreachersKid, CC BY–SA 3.0
ZIRP is slowly ending. The Fed has raised rates and has promised to continue raising rates through 2019.
That isn’t good news for the shale industry that will now need to refinance all of its loans at higher rates. But as in all good bubbles — and despite the warning signs — the oil industry is brimming with optimism in 2018. And the Wall Street money keeps pouring in at record levels, with plenty of buyers still eager to snap up these junk bonds.
According to Bloomberg, “Junk-rated energy companies were able to fund a record $9.25 billion of issuance in January.”
But despite the record-setting pace of junk bonds for energy companies, plenty of people are now warning of the problem (or crisis) that the Fed raising interest rates will create for the junk bond market and the shale industry. The problem was summed up quite well by the sub-title of this Seeking Alpha article: “Fed tightening affects junk bond prices negatively.”
How negatively? Financial data company Pitchbook recently highlighted some of the risks based on information from the U.S. Treasury’s Office of Financial Research (OFR), which says that the financial risk of interest rate increases is at an all-time high. “Just a 1 percent rise in interest rates would result in $1.2 trillion in losses from the Barclays U.S. Aggregate Bond Index — with even larger losses when one includes ‘junk’ high-yield bonds,” reported Pitchbook.
A return to even the historically low federal fund rates in the 5 percent range — where they were just before the financial crisis of 2008 — would be devastating to the junk bond market and the shale industry — as well as all of the asset managers who currently own this junk.
Pitchbook notes that the OFR says “the risk of a turnaround in interest rates are now higher than the ‘bond massacre’ in 1994 that drove Orange County, California, into bankruptcy and ignited Mexico’s peso crisis.”
It’s important to keep in perspective that even major shale oil companies like Continental Resources haven’t been able to pay the interest on the money they already owe at these historically low rates, a point that holds true throughout the industry. Companies have been borrowing money to pay interest on the money they have already borrowed.
Full Speed Ahead … Towards a Wall of Debt and Higher Rates
The movie (and book) The Big Short features several investors who all saw the housing bubble for what it was and then bet against Wall Street and the bad debt that was fueling the housing bubble. They were right and eventually made billions. However, they spent years knowing they were right but watching the housing bubble continue.
Ivy Zelman, a housing-market analyst at Credit Suisse, was one of the people who identified the housing bubble early on, and she notes that while it was clear there was a problem, it wasn’t clear when the reckless financial behavior would end.
“It wasn’t that hard in hindsight to see it,” Zelman said. “It was very hard to know when it would stop.” This sentiment echoes the famous Wall Street axiom: “The market can stay irrational longer than you can stay solvent.”
Much like the housing bubble, the shale bubble has gone on much longer than expected (by some). Of course, that just means that the industry is in a lot more debt than in 2014 when people first started warning about this issue. If things go bad now, they will go much worse than in 2014.
In 2014, Ivan Sandrea, a research associate at the Oxford Institute for Energy Studies, posed this question:
“Who can, or will want to, fund the drilling of millions of acres and hundreds of thousands of wells at an ongoing loss? The benevolence of the U.S. capital markets cannot last forever.”
While an industry that has never made money and is deep in debt cannot last, it can go on longer than expected. Just like the housing crisis did.
Even Wilbur Ross, currently the U.S. Secretary of Commerce, was warning about the shale debt problem in late 2015. He pointed to two specific problems: rising interest rates and the “wall” of debt coming due starting in 2018.
Ross told CNBC that companies were “running out of time” because “you have a wall of maturities starting in 2018, building up through 2021 [and] 2022.”
And here we are: in 2018 with rising interest rates and the shale industry piling on record levels of new debt via junk bonds while facing a wall of debt.
In January, William White, the Swiss-based head of the OECD’s review board and ex-chief economist for the Bank for International Settlements, commented in The Telegraph on the impacts of ZIRP and “free money.”
“Nine years of emergency money has had a string of perverse effects and lured emerging markets into debt dependency,” White said.
Sounds like an accurate description of the last nine years of the shale industry. But that wasn’t all White had to say: “All the market indicators right now look very similar to what we saw before the Lehman crisis, but the lesson has somehow been forgotten.”
It looks like the shale industry and the investors who funded it are poised to re-learn those lessons. However, as we know, Wall Street will prosper no matter what happens.
The question that remains is who will pay to bail out Wall Street and the shale industry if the bubble pops?
If history is any indication, it will be the same U.S. taxpayers who haven’t been making interest on their savings for the last nine years.
76 Comments on "This Federal Policy Enabled the Fracking Industry’s $280 Billion Loss"
MASTERMIND on Tue, 22nd May 2018 3:29 pm
Excellent article..Fracking is a ponzi that should be shut down by the Nevada gaming commission.
twocats on Tue, 22nd May 2018 3:38 pm
Permian definitely has the loosest slots – I mean wells – wells right now.
MASTERMIND on Tue, 22nd May 2018 4:00 pm
Unemployment Rate Is Lowest in Years—and Many Americans Are Just Hanging On
https://www.bloomberg.com/news/articles/2018-05-22/fed-poll-shows-many-americans-missing-solid-job-market-s-bounty
They have nothing to lose and everything to gain in faking the unemployment data..I mean by the time the public figures out what the hell is going on..The economy will have totally collapsed and we will all have much bigger problems on our hands, then getting justice to those who mislead us about how bad things were.. There is no upside to telling people the unemployment rate is 15% (or higher).
Retired Geoscientist on Tue, 22nd May 2018 5:06 pm
But look on the bright side, dumb money funding the shale industry bought the US consumer 4+ years of cheap oil. Without it, oil prices would have remained above $100 a barrel and a gallon of gasoline around $4. Of course on the downside, it trashed the conventional and deep water oil industry where the under investments are now coming back to bite. Just not enough US shale oil, especially with the bottlenecks, to counter to fall in oil supply from the rest of the world.
I can’t see the shale revolution being repeated anywhere else. Can you imagine a national oil company announcing to it’s people that their subsides would be cut over the next 5 years to the tune of several $100 billion just to produce shale oil for the rest of the world at a loss? Only can happen in the USA with ZIRP!
MASTERMIND on Tue, 22nd May 2018 5:44 pm
Chevron CEO warns US shale oil alone cannot meet the world’s growing demand for crude
https://www.cnbc.com/2017/05/01/us-shale-cannot-meet-the-worlds-growing-oil-demand-chevron-ceo-warns.html
It takes 2,500 shale wells a year just to sustain output of 1 million barrels a day in North Dakota’s Bakken shale, according to IEA. Iraq could do the same with 60 conventional wells.
https://www.bloomberg.com/news/articles/2014-02-27/dream-of-u-s-oil-independence-slams-against-shale-costs
The IEA is grossly overestimating shale growth
https://oilprice.com/Energy/Oil-Prices/The-IEA-Is-Grossly-Overestimating-Shale-Growth.html
Peak U.S. Shale Could Be 4 Years Away
https://oilprice.com/Energy/Crude-Oil/Peak-US-Shale-Could-Be-4-Years-Away.html
Shale Produces Oil, Why Not Cash?
https://www.wsj.com/articles/shale-produces-oil-why-not-cash-1498486995
Is Peak Permian Only 3 Years Away?
https://oilprice.com/Energy/Crude-Oil/Is-Peak-Permian-Only-3-Years-Away.html
Plantagenet on Tue, 22nd May 2018 6:30 pm
Sarah Palin promised drill baby drill could turn the US into an oil exporter, and then Obama went out and actually did it.
Cheers!
MASTERMIND on Tue, 22nd May 2018 7:05 pm
Cry baby Nazi after being exposed..
https://i.redd.it/7dr8nesa2fz01.jpg
MASTERMIND on Tue, 22nd May 2018 7:12 pm
Behold the Master Race!
https://imgur.com/a/BN6Xq
This is how you treat a Fascist!
https://i.imgur.com/PVa60tN.gifv
Richard Spencer gets blasted by AntiFa!
https://www.youtube.com/watch?v=YlUxCsQMuwY
Anonymouse1 on Tue, 22nd May 2018 9:40 pm
This article has features far too many accurate and honest appraisals of the true state of the amerikant fraking industry. Someone needs to counter all this truth and reality. Po,com needs a hero, an amerikant hero, one who not afraid to tell it like is.*
*(is not actually)
I know! This sounds like a job, for ‘the’ NARRATIVEMAN(tm). Right now, alarm bells are no doubt going off in the narrativemans….narrartive cave, alerting him that someone is pouring cold water all over the uS frak cartel on PO.com. Now doubt, he mobilizing and equipinging himself with all the latest in high-tech talking points and dismissive screeds at his disposal.
Get ready for classic narrativeman quips and talking points, like….
“Another fool who has no idea what he talking out.”
“Clearly, this person has no idea about the complexities and nuances behind uS oil patch financing.”
“I’m only here, and am only too happy to educate the un-informed”.
“Another hippy-dippy liberal dope-smoker who probably uses cars, plastics AND computers all while complaining about the charitable works uS oil corporations engage in every single day, all in order to make the world a better place to live.” (for the children).
Common narrativeman, not one but TWO articles back-to-back slamming the dodgy financing underwriting all that paint-thinner and not-quite-oil the uS is ‘producing’ these days.
As an added bonus, the exceptionalturd will likely ride in on his white hor….goat, or donkey perhaps as he so predictably does, to protect your back while you do battle with the ‘un-informed’.
MASTERMIND on Tue, 22nd May 2018 10:04 pm
Anonymouse1
I was going to say the same thing..the Rockbrain will chime in anytime now..and of course he will start off by insulting the writer so he can assume a position of authority..And he will spew some long winded diatribe of jargon…
dave thompson on Tue, 22nd May 2018 11:44 pm
The Fed makes money out of thin air. Puts the money in the corporate interests hands and volla…… instant shity oil and gas that makes it all so sustainable, looking, sort of. That is if you are an idiot.
marmico on Wed, 23rd May 2018 5:24 am
This Federal Policy Enabled the
Fracking Industry’sHomeowner’s $280 BillionLossGain (per year).Davy on Wed, 23rd May 2018 6:01 am
Macro and global policies of low interest rates and easing of various forms have allowed malinvestment and the distortion of risk. This malinvestment and distortions are a result of corrupted macro price discovery. Price properly applied in a neutral environment represents fairness. Fairness represents a human satisfaction. It is the basis of our modern civilization at least in theory. Corruption of basics of rule of law and accepted accounting principles has resulted in and is the caused these global central bank policies. We are now in a circular trap of one needing the other. More corruption begets more extreme central bank policy. Shale is just part of this as so many other activities of unrestrained corruption spill out of a decaying corpse of modern civilization.
print baby print on Wed, 23rd May 2018 6:19 am
Print baby print . They will do it to the end . Desperately needed oil. Even if it is not real oil I am puzzled why other print baby print nation didnt participate in fracking madness
Davy on Wed, 23rd May 2018 6:22 am
“Turkey Heads Toward a Currency Crisis as Lira Goes Into Freefall”
https://tinyurl.com/yalzbb5n
“Policy makers “must hike now,” said Cristian Maggio, the head of emerging-market strategy at TD Securities in London. “There’s no limit to how far this could go because this is becoming a currency crisis.” Eventually, Turks will start selling too, and then there will be “total loss of confidence,” he said.”
Outcast_Searcher on Wed, 23rd May 2018 9:56 am
When the oil majors, which are heavily into fracking, aren’t making huge profits, be sure and get back to us on how the fracking industry is losing so much money.
It’s always some conspiracy theory with fast crash doomers, since their short term claims never come to pass.
Outcast_Searcher on Wed, 23rd May 2018 9:58 am
Hint: The fracking industry got a lot more efficient via what it learned over time. What do you think that does to costs? But let’s just ignore that and all the reporting on that, so we can spread FUD about doom, whether there is any truth to it or not. /s
Outcast_Searcher on Wed, 23rd May 2018 10:01 am
Interest rates correlate well with inflation over time. Imagine that. If inflation were high, the doomers would be carping constantly about that.
How about taking a balanced, rational look at economics for a change, just to pretend not to be in CONSTANT FUD spreading mode?
MASTERMIND on Wed, 23rd May 2018 10:04 am
Outcast
Peak oil is now..
IEA Chief warns of world oil shortages by 2020 as discoveries fall to record lows
https://www.wsj.com/articles/iea-says-global-oil-discoveries-at-record-low-in-2016-1493244000
Saudi Arabia’s Energy Minister Warns of World Oil Shortages Ahead
https://www.wsj.com/articles/saudi-minister-sees-end-of-oil-price-slump-1476870790
Saudi Aramco chief warns of looming oil shortage
https://www.ft.com/content/ed1e8102-212f-11e7-b7d3-163f5a7f229c
Sleepwalking Into The Next Oil Crisis
https://www.forbes.com/sites/rrapier/2018/03/23/is-the-world-sleepwalking-into-an-oil-crisis/#509edc8b44cf
According to the German Army leaked study. When the oil shortages hit, Wall street will crash, the public will lose all faith/trust in their institutions, and the global economy and world governments will collapse..
http://www.energybulletin.net/sites/default/files/Peak%20Oil_Study%20EN.pdf
Enjoy the collapse you gutless little bitch..
MASTERMIND on Wed, 23rd May 2018 10:07 am
Garry Kasparov: I told you Putin would attack U.S. election — and he will again
https://www.yahoo.com/news/gary-kasparov-told-putin-attack-u-s-election-will-195305087.html
Putin must be stopped by a nuclear first strike..
Antius on Wed, 23rd May 2018 11:04 am
“Garry Kasparov: I told you Putin would attack U.S. election — and he will again”
Millimind, Putin did not ‘attack’ the US election. In spite of two years of witch hunting, there is no evidence of covert Russian government involvement in the US election. Putin has behaved far more honourably in this respect than the US, which routinely uses dirty tricks to influence foreign elections in favour of neocon global interests.
Even if Putin had directly funded Trump’s campaign (which he didn’t) he would only have been doing what Saudi Arabia and Israel already do for the Democratic party. As it is, much of Trump’s campaign funding came from wealthy Jewish neocons and he is noisily doing their bidding in Syria, much to everyone else’s disappointment.
Putin is hated and reviled in the leading cabals of the US and UK for the simple reason that he refused to allow globalist oligarchs to asset strip his country. The bulk of actual citizens in those countries have no conflict of interest with Russia at all. Were it not for the interference of the US/UK deep state, there would be no cold war with Russia and it would be part of a western alliance.
Cloggie on Wed, 23rd May 2018 11:30 am
Millimind says: Putin must be stopped by a nuclear first strike..
The insane fanatic millimind effectively is pleading for millions to get killed.
Mel Gibson says:
https://tinyurl.com/y754xdt9
Voltaire says:
Voltaire, in the pose of an ancient Roman reporting on the Jews, wrote: “They are, all of them, born with raging fanaticism in their hearts, just as the Bretons and the Germans are born with blond hair. I would not be in the least bit surprised if these people would not some day become deadly to the human race.”
https://www.nytimes.com/1990/09/30/books/l-voltaire-and-the-jews-590990.html
The first American politician Peter Stuyvesant wrote to his masters in Amsterdam:
I don’t want them here in New Amsterdam… “the deceitful race, such hateful enemies and blasphemers of the name of Christ.”
https://www.timesofisrael.com/should-new-york-city-remove-statues-of-its-anti-semitic-dutch-governor/
He was talking about millimind’s tribe.
Arthur Schopenhauer: “grandmasters of the lie”.
The list goes on and on and all negative.
If millimind’s tribe has been thrown out of countries #109 times, it must have something to do with the tribe itself.
What are we going to do with him?
#110
Darrell Cloud on Wed, 23rd May 2018 11:38 am
Think about it. Shale has given us another Indian summer in the run up to our limits to growth.
Within the plutocracy, there are elements that understand full well our dilemma.
The money is not real. It never was. The Federal Reserve was a brilliant construct. It has allowed the federal government to grow beyond anything the tax base could actually afford. Our endless wars, our entitlement programs, our massive military, all of it is funded by conjured money.
If shale oil costs a thousand dollars a barrel to produce, it does not matter because the money funding its production is not real. This is different than your classical Ponzi scheme. The plays are in the classical sense being fronted by new investors, but the real backer is the Fed and it has unlimited reserves.
Imagine this: You are one of the key apparatchiks in the system, and one of your underlings comes to you with a pile of graphs and numbers that prove without a doubt that shale oil production is not profitable. The cost of extraction is too great and the economy cannot afford it. A second underling presents you with another pile of charts and figures that prove beyond a doubt that legacy oil fields are in terminal decline. A third underling has run the numbers and projects that systemic collapse is three to five years out. The shale guy points out that business as usual can continue for another five to then years if the Fed backs production.
What you do? I would mouse click the money into existence and go home and enjoy my family.
GregT on Wed, 23rd May 2018 11:46 am
“What you do? I would mouse click the money into existence and go home and enjoy my family.”
If it were me, I’d be in the market for a pleasant retreat, somewhere in rural New Zealand.
Cloggie on Wed, 23rd May 2018 11:56 am
If it were me, I’d be in the market for a pleasant retreat, somewhere in rural New Zealand.
And prepare for the Chinese to arrive? High “Falklands-1980 solution”.
http://nationalinterest.org/feature/america-australias-dangerous-ally-11858
The “Canadian sticks”, far away from Vancouver, isn’t that bad.
Other suitable locations: Norway, Uruguay, Chile, Hungary, Scotland (language, ancestry?), Finland.
MASTERMIND on Wed, 23rd May 2018 12:10 pm
Alex Jones dons a clown mask and makes anti-gay comments while ranting about Rep. Eric Swalwell
https://www.mediamatters.org/blog/2018/05/23/alex-jones-dons-clown-mask-and-makes-anti-gay-comments-while-ranting-about-rep-eric-swalwell/220292
Cloggie on Wed, 23rd May 2018 12:14 pm
“Garry Kasparov: I told you Putin would attack U.S. election — and he will again”
Gary Kasparov is one of your tribe, millimind. He (and you) will never forgive Putin for kicking out the (((oligarchs))) from Russia to Israel and the UK. He wants to have Russia and its Goyem back, just like they have America for 100 years now and had Russia between 1917-1938 and 1991-2000:
https://www.amazon.com/Winter-Coming-Vladimir-Enemies-Stopped/dp/1511365447
But Xi, Putin and European populists know the score exactly:
http://www.tabletmag.com/jewish-arts-and-culture/books/167289/nanjing-jewish-studies
https://www.youtube.com/watch?v=1jt9MLdg3JQ
https://www.reuters.com/article/us-hungary-soros-office/george-soros-foundations-office-to-pull-out-of-hungary-idUSKCN1IG0IT
The tide is turning, we Eurasians have them by the balls. WW3 is now in our interest, to achieve some major geopolitical reshuffling.
We have the necessary weapons…
https://www.zerohedge.com/news/2018-05-21/how-russia-and-china-gained-strategic-advantage-hypersonic-technology
The official propaganda line should be: “liberate European-America”.
Real motive: destroy ZOG.
Dismemberment Anglosphere is next.
https://en.wikipedia.org/wiki/Five_Eyes
It is a recurring pattern in geopolitics that the #1 is attacked by a coalition of #2.. #n in order to achieve upwards geopolitical mobility for the attackers.
Europe, the #1 for 500-2000 years was intentionally destroyed by rising powers USA and USSR in 1939-1945.
Germany was intentionally destroyed in WW1 by the UK, France and Russia.
Now it is the turn of the US to be toppled from pole position.
MASTERMIND on Wed, 23rd May 2018 12:15 pm
Darrell Cloud
Great summary..I totally agree..The bankers have done everything in their powers to keep BAU going..the paranoids just want to blame them for everything because they are the top of the food chain..they have to have a boogy man..
MASTERMIND on Wed, 23rd May 2018 12:20 pm
Clogg
Europe is in a deep depression and headed for collapse..Your fantasy future aint happening..You are just to gutless to admit it..
Cloggie on Wed, 23rd May 2018 12:32 pm
Europe is in a deep depression and headed for collapse..Your fantasy future aint happening..You are just to gutless to admit it..
You’re an idiot.
http://money.cnn.com/2018/01/30/news/economy/gdp-europe-economy-2017/index.html
https://www.youtube.com/watch?v=PM9_PrBoq9Q
What depression? What collapse?
For you (and meathead) this peak oil baloney is wishful thinking and seen as a possibility for a face-saving retreat from empire, rather than to have your ass spanked by Eurasia.
MASTERMIND on Wed, 23rd May 2018 12:48 pm
Clogg
Europe GDP per capita which is inflation adjusted..
1976 (5.4)
2016 (1.6%)
Source: World Bank
https://data.worldbank.org/indicator/NY.GDP.PCAP.KD.ZG?locati&locations=EU
Sorry but fake corporate news doesn’t change hard numbers..This is why Europe is busting at the seems..lol
MASTERMIND on Wed, 23rd May 2018 12:51 pm
CLogg
Peak oil is not wishful thinking. Here are several sources that prove it beyond any reasonable doubts.
Peak oil is now..
IEA Chief warns of world oil shortages by 2020 as discoveries fall to record lows
https://www.wsj.com/articles/iea-says-global-oil-discoveries-at-record-low-in-2016-1493244000
Saudi Arabia’s Energy Minister Warns of World Oil Shortages Ahead
https://www.wsj.com/articles/saudi-minister-sees-end-of-oil-price-slump-1476870790
Saudi Aramco chief warns of looming oil shortage
https://www.ft.com/content/ed1e8102-212f-11e7-b7d3-163f5a7f229c
Sleepwalking Into The Next Oil Crisis
https://www.forbes.com/sites/rrapier/2018/03/23/is-the-world-sleepwalking-into-an-oil-crisis/#509edc8b44cf
According to the German Army leaked study. When the oil shortages hit, Wall street will crash, the public will lose all faith/trust in their institutions, and the global economy and world governments will collapse..
http://www.energybulletin.net/sites/default/files/Peak%20Oil_Study%20EN.pdf
Your world is coming to an end soon. And within the next decade you will die of conflict or starvation..
fmr-paultard on Wed, 23rd May 2018 1:15 pm
i can’t believe i supported jerkoff jones and gave him a lot of shekles. he attacks fathertard francis constantly. his fake news empire goinna fall with the law suit
Cloggie on Wed, 23rd May 2018 1:20 pm
“1976 (5.4)
2016 (1.6%)”
1.6% growth is not depression, let alone collapse, you fool.
EU growthin 2017 was 2.4% and forecast 2.3% for 2018:
http://ec.europa.eu/eurostat/documents/2995521/8718257/2-07032018-AP-EN.pdf/99862cd5-dba6-49fa-bb2a-aa5395fa8b1b
MASTERMIND on Wed, 23rd May 2018 1:39 pm
CLogg
And 2 percent growth would be around 1 percent GDP per capital, which is inflation adjusted. And that is way lower than the global average..And the global economy grew around 1.5% during the great depression..This is why the Nazi’s are back..History repeats..Hitler rose to power during the middle of the great depression (1934)..Anyway you slice it.Your economy has been contracting for four decades. And there is no turning that around. And once the oil starts to run short and the price spikes to the moon! Its game over for Europe..
fmr-paultard on Wed, 23rd May 2018 1:45 pm
^mm^ we have supertards to protect us from “nasties”. nasties give supertards a bad name they don’t want anything to do with it. one bad news thoguh, we ran out of bombs. not to worry supertrads will make bombs out of new materials
Cloggie on Wed, 23rd May 2018 1:53 pm
Venezuela, that is collapse. Europe is doing fine, thank you very much.
https://www.politico.eu/article/psst-europes-economy-is-doing-well/
MASTERMIND on Wed, 23rd May 2018 2:09 pm
Someone wrote an Elon Musk confession on reddit today..
“I used to be a huge Elon fan for the past two years. I used to tell my friends and my family about all the great things elon will do for us. I even tell people not to learn to drive because Elon will in a few months will build a fully automatic car that no drivers will be needed. Now that I have realized elon to be a bluff. I am embarrassed and covered in cringe.”
The biggest fans often become the biggest detractors. See mark david chapman. Although martyrdom is too good for musk..
MASTERMIND on Wed, 23rd May 2018 2:14 pm
Clogg
Fake news doesn’t beat numbers..Europe’s economy is based on a number that is not debatable. And Europe’s economy is as worse as its been in fifty years..
Source: World Bank
https://data.worldbank.org/indicator/NY.GDP.PCAP.KD.ZG?locati
MASTERMIND on Wed, 23rd May 2018 2:20 pm
Clogg
Europe GDP 1973 (6.1%)
Europe GDP 2016 (1.9%)
Source: World Bank
https://data.worldbank.org/indicator/NY.GDP.MKTP.KD.ZG?locati&locations=EU
At the rate you are headed your growth is be negative in the next ten years..And it wont matter how much you rearrange the deck chairs with populist leaders. You cant vote in prosperity that can reverse a forty year trend..
MASTERMIND on Wed, 23rd May 2018 2:39 pm
Alex Jones dons a clown mask and makes anti-gay comments while ranting about Rep. Eric Swalwell
https://www.mediamatters.org/blog/2018/05/23/alex-jones-dons-clown-mask-and-makes-anti-gay-comments-while-ranting-about-rep-eric-swalwell/220292
What a sick and twisted person..Only the dumbest of the dumb would listen to him..Just another sign of social collapse.
Cloggie on Wed, 23rd May 2018 2:45 pm
Just another sign of social collapse.
Mwoah, I prefer to call it secession or balkanization:
https://goo.gl/images/TDMnCD
MASTERMIND on Wed, 23rd May 2018 2:50 pm
Clogg
Who is Jones going to fight a revolution against? Trump? He is the biggest cheerleader for government..And the right is has way too much belly fat to be fighting any revolutions..Just another fantasy in your world of paranoid schizophrenia..
CommiesRus on Wed, 23rd May 2018 3:37 pm
Masterfag. I recommend you go for a nightly stroll in a muzzie infested zone. You would get a nice refill of muzzie fag jizz. No need for your kind to be deprived and frustrated.
MASTERMIND on Wed, 23rd May 2018 4:40 pm
Strangers are more likely to come to your need in an ethnically diverse neighbourhood
https://digest.bps.org.uk/2018/05/23/strangers-are-more-likely-to-come-to-your-need-in-an-ethnically-diverse-neighbourhood/
Antius on Wed, 23rd May 2018 5:12 pm
MM, maybe you should read your own links. From the link you posted:
“Putnam’s work tallies with a distinguished psychological idea, conflict theory, which suggests salient distinctions between people in an area heightens a sense of competition between groups over resources. Because race is so visible – neuroscientific studies suggest we perceive it earlier even than gender – the argument goes that racially diverse areas lead people to, as Putnam puts it, hunker down and withdraw. Consistent with this view, Putnam’s data shows that multicultural areas have lower levels of trust – even between people of the same race – and some evidence, but not all, has shown this has a knock-on adverse effect on civic engagement and volunteering.”
In other words, when you see a person of a different race, your brain is hardwired to perceive them as a foreigner. It isn’t something that can be conditioned out of people, which is why Jewish efforts to build ‘multicultural’ societies always end with high crime and civil unrest. It also explains why ZOG controlled societies are such oppressive places. It takes an infinite amount of force, surveillance and control, to make people do the impossible.
MASTERMIND on Wed, 23rd May 2018 5:27 pm
Antus
You are a paranoid whack job..which means you fit right in on this site..There is always some boogy man to you nut jobs..And it always the jews..
Antius on Wed, 23rd May 2018 5:53 pm
“Antus, You are a paranoid whack job..which means you fit right in on this site..There is always some boogy man to you nut jobs..And it always the jews.”
Why would I be paranoid? This coming from a man who dreams of nuking Russia and whose relatives appear to be edging towards doing just that. These people have already stamped out free speech and turned my country into an oppressive police state. It isn’t paranoia when the bastards really are out to get you.
MASTERMIND on Wed, 23rd May 2018 6:15 pm
Antius
Nobody is out to get you..You are just a paranoid neckbeard loser like Clogg..
Makati1 on Wed, 23rd May 2018 7:31 pm
Antius, the delusional MM should be ignored. His psychosis is getting really bad. He needs help, but thinks himself sane, intelligent and mature. Total delusion. He reverts to putdowns and name calling when you try to point out his problem, or he cannot refute your statement with proof.