Too Low for Too Long

A response made to Steve from Virginia’s Too Low for Too Long  thread on Economic Undertow

RE

Discuss this post inside the Diner 

Too Low for Too Long?  For sure, but why so low for so long?

Those who took control over the Oil resource early on in the game, aka John D. Rockefeller and Pals had to make it Affordable for people to buy, elsewise why control the resource at all, eh?

Who issues the Credit to buy this resource from John?  John issues it of course, and places an interest charge on his loan.  John keeps the interest low as long as he has plenty of Oil flowing cheaply out of the ground around Jed Clampett’s farm, but when he starts running Short on Oil to sell, the prices rise and the credit cost in interest to buy it rises also.  John is still doing fine of course despite the shrinking supply and falling demand, and will continue to do fine right up until it completely runs dry here.  He’ll just keep downsizing and selling to Boutique Economies until the system shrinks so much as to no longer being able to support even one Oil field and One Tanker Ship and One Refinery and One distribution network for the finished product.

Along the way, John ALSO invested in and built many structures all dependent on the Oil he controlled and sold.  He invested in Henry Ford’s Carz of course, and Edison’s Lightbulb.  Lovely inventions all these things were also, and EVERYBODY wanted one, to be part of the great Future they all promised.  Just look at the photos from the Chicago World’s Fair of 1893 to see the Gleaming Future promoted, and really every World’s Fair thereafter also right up to the one I attended in 1964 in Flushing Meadows park in NYC.

It was all of course a Dream, a Bubble created which sieved great wealth into the hands of the people who controlled this once seemingly inexhaustible resource, while at the same time “improving” the lives of everyone suckered into the game here.  The Bubble is Burting now, fittingly first going down the tubes in the place where accessing thermodynamic energy from fossil fuels all began, in Eurotrashland where the Stem Engine was first used to pump the water from Coal Mines.

Nobody can issue credit to buy stuff that just is not there to buy anymore, not at prices which make a Profit on the extraction anyhow.  Not even John D. Rockefeller or his heirs can Make Something from Nothing of course.

So one by one here the Dominoes topple, the weakest like Greece going first down the Toilet hear, Spain soon to follow.  The Powerful are Ringfencing and using the Big Ass Military they control to keep their own systems running a bit longer here than everybody else.  How long that can last is anybody’s guess, but I suspect not all that long.

Nothing wil stop this cascade failure, no monetary fix can work, no Fiscal Union of Europe and no amount of QE by Helicopter Ben and his CB Cronies either.  The PARTY is OVER.   The Keg has run dry here.  Now we will REVERSE ENGINEER our way back to a low per capita energy footprint on Mother Earth, or we wll go the way of the Dinosaur.  Over/Under on this is about 50-50 at the moment, getting worse all the time though.