The Brink

It seems to me that we are on the edge. Not of an abyss, but a long rocky slope. Now an abyss is the worst case, as society plummets to anarchy. But as I see it now, we are looking at a grid-up, slow slide. I have taken a tumble down such a slope while mountain-biking, and as you slide and tumble those boulders you bounce off hurt.

Looks like society, our "civilization" will be doing the same thing. Sometimes falling faster, sometimes a hard crash as it impacts a checkpoint along the slope. These checkpoints could be mass riots, famine, disease outbreaks, war, alien invasion, or the worst - Jeb Bush running for the Presidency!

The market looks to me like it's correcting itself a little bit. Oil is dropping in price some, but that is because we are driving less, and not burning it for home heating fuel. I expect oil to stabilize at about $115 a barrel unless a hurricane wipes out some oil rigs in the gulf, or a refinery.

So if it's one thing I know from living up here in the Northeast my whole life is just how bad it gets financially when the weather gets cold. As a kid we couldn't afford oil so we heated the whole house with wood. in '77-'78 we went through eleven cords of wood. For those of you unfamiliar with the measurement, a cord is 4' logs, piled 4' high and 8' long. That's when I learned to use a chainsaw, and how to split wood. I split all 11 cords myself.

So for those in the northern half of the US, they are feeling a financial crunch from keeping their AC running, taking vacations, etc. When Old Man Winter comes around, these family's will be in deep kimchi. Right now, home heating fuel is up from $3.54 a gallon to $4.95. Most people I know spent about $3k to heat their homes last winter, this year that would be $4200! After the rough summer months, many, many families wouldn't be able to heat their homes this year. That means more families on welfare, food stamps, and most importantly - losing their homes.

Winter is a slow time for real estate, so the banks will have to carry the foreclosed homes longer, or take more of a loss to dump them quickly. I would have to say that November and December will be the months to watch, unless something big happens sooner. When the gas and diesel prices cut back on food in the grocery stores, I expect to see food riots out here on the east cost. Up here in the Northeast we rely on all our food staples to be trucked in from the Midwest, or shipped to us via bulk container. Once these riots start, I expect things to unravel rather quickly.

Then again, The FedGov could stop wearing their asses for hats, and we might get out of this without a major crisis. I am a gambling man, but I'm not dumb enough to play those odds. Store food, spend what money you get wisely, arm yourself, and try to find friends who you can count on.

are you F'ing kidding me?

So the republicans came up with this: $300 million to whoever builds a better battery. That is pure fucking genius. So lemme ask the question where is the money coming from? So I get to pay out of my taxes for something that the government should have been working on for 30+ years? In McCain's brilliant plan, every car made that is zero emissions gives the auto company $5,000 in tax breaks. For each car! If it's not coming from taxes then the FedGov is going to print more monopoly money to pay. Reduce corporate taxes, spend more money. That is just SUPER!

So the Saudis have played the American government like a fiddle. Bush goes in and begs for them to increase production, and they basically say "Fuck off!" Now they say they will increase production to win over the stupid people's public opinion. "Gee they are pumping more oil, why is gas still going up? Must be the Oil Companies!" Well what I see buried in the press reports is that the Saudis are pumping high-sulfur crude, which is shitty for making gas. Classic bait-and-switch.

I'm surprised that gas has not gone up more. Crude has doubled in price, but gas hasn't doubled... I need to do more poking around and see what the historic trend is between the price of crude and the price of gas. I also need to trend the price of #2 heating fuel because that is what I heat the house with. I got to polish up my crystal ball and see what we are in for this winter.

Oil

I have to admit I've slacked off a bit today to research just what is going on with the price of oil these days. I heat my house with oil, and there is no freaking way I'll be able to afford to heat my house this winter. Because of the brilliant fire-codes here in my town, I cannot add a wood stove either. So basically, I'm fucked this winter.

So it looks like there are several reasons for the gas to be so expensive. China has doubled it's oil imports over the last 10 years. OPEC won't increase production. The cost to actually refine the oil has jumped from $5-$10 a barrel to $20 - $30 a barrel. The world demand for oil has gone up as well. The dollar is so weak right now, I think I'll kick the next Republican I see in the beanbag.

Of all these factors only two are pointing to a sharp increase in price. The weak dollar is killing us, and those nitwits printing more money is not helping the issue. Also, there is the spike in refining costs for fuel. I see no reason as to why it would cost more to refine a barrel of oil this year rather than last year. I think this bears more investigation.

Ultimately though it's our Federal Government that is squarely to blame. If those meatballs in office could just keep the dollar strong we wouldn't have it half as bad as we do now. Just thinking about it makes me tankful I am in a (mostly) recession-proof field of work. I might not lose my job, but my money is in survival mode, I'm not even going to see the new Indy film to save $.