Since I think I am smart, going to make prediction. (more…)
Archive for May, 2008
Predicting housing prices
Wednesday, May 28th, 2008More maths on oil
Wednesday, May 28th, 2008Econbrowser publishes oil price estimates in more detail
Bottom line: Demand is going to rise one hell of a lot. Supply for that demand just is not there.
This paper does not review supply from coal to liquids or gas to liquids. The only way to meet demand is to generate liquids from coal by underground gasification followed by gas to liquids conversion. This will require many, many quite gigantic projects, but at present we have only a small number of small exploratory projects, most them scheduled to start producing around 2015 or so. So the price of oil will have to rise to quite astonishing levels, at least for a couple of decades. We have only seen the beginning.
Terror works
Friday, May 23rd, 2008Before the twentieth century, the usual method for suppressing guerrilla war was artificial famine, state sponsored mass rape, and mass murder. During the twentieth century the communists used these methods heavily to quell not only resistance, but to quell resentment, to quell suspected politically incorrect thoughts. These methods generated curiously little resentment. Indeed, it seems that the greater the injury, the less the hostility. Certainly that is how things worked out for the communists. (more…)
Finally, some one else does the maths on oil
Thursday, May 22nd, 2008I am continually puzzled by the world’s chronic inability to do basic arithmetic, but I see that econbrowser has done the maths on oil.
There are a lot of people in China. There are no longer large political obstacles to competent and industrious people in China making money. Therefore, very soon, a lot of Chinese will be making a lot of money. Therefore China will soon be consuming an enormous amount of oil. Econbrowser concludes China will soon be consuming a lot more oil than is ever likely to come out of the ground.
Therefore the price of oil will rise without limit until coal to oil and nuclear to hydrogen fills the gap. And right now, coal to oil projects are insignificant, and nuclear to hydrogen is not even on the drawing board. Therefore in the next decade or so, oil will rise to astonishing heights, far above present prices.
This time they did ring a bell at the bottom
Wednesday, May 21st, 2008You know the saying about markets: “They don’t ring a bell at the top or the bottom”
The bell has just rang to announce the bottom of the housing market in California. From here on out, the prices are going up from insanely high to even more insanely high. Never again will ordinary affluent middle class people be able to buy a house in silicon valley, until the day dawns when the private property right to develop land is once again respected.
Various incompetently run or criminally run banks found themselves with lots and lots and lots of inflated and fraudulent mortgages. In due course, they found themselves with the real estate that was securing the mortgage. In the last few days they have held auctions in Silicon Valley and Sacramento to get rid of the properties. The properties sold like hotcakes, with bidders bidding them up, and up, and up.
Meaning of Hezbollah offensive in Lebanon
Wednesday, May 21st, 2008On May 9, Hezbollah fighters were wandering around Lebanon. The meaning and implications of these events were not clear at the time. No one, least of all Hezbollah, had a clear idea.
Now it is clear what happened.
The Lebanese state is a failed state. It lacks the will and capability to fight the various armed groups in Lebanon, or to impose its will on them. Hezbollah tested the government. The government was an empty bag. It tested the major Sunni party, with the same result. It tested the major Druze parties, which likewise collapsed, but the Druze did not collapse, instead inflicting a nasty defeat on Hezbollah. After running into trouble with the Druze, it declined to firmly test the Christians. The government has shown itself powerless, and the political parties that focused on elections, parliament, and participation in the government have similarly shown themselves to be powerless.
Genocidal famine still planned
Sunday, May 18th, 2008At present, Environmental Protection Agency rules require that that Americans convert food that could feed five hundred million people into fuel. But this is not enough. The rules require that it be increased five fold over the next fifteen years.
Europe is falling
Thursday, May 15th, 2008Observe in this video the British police are as frightened and weak before Muslims, as the British police are terrifying and dominating over Britishers in other videos. The British state is as contemptible to its enemies as it is terrifying to its subjects.
The fear and weakness we see in this video, we also saw when the Iranians over ran the British in the Persian gulf, and when the British fled before the Shia militias in Basra.
In this video, the Muslims rule the streets, and not only are the British frightened, weak, ashamed, and apologetic, but the British police, normally so arrogant, violent, and destructive, normally filled with brutal contempt for the merely law abiding middle class British civilians, are frightened, weak, ashamed, and apologetic.
The British state that has such contempt for Britishness, that it confidently will remake the British in its own image, in this video shows its true weakness and shame before Islam.
Exxon blows it
Wednesday, May 14th, 2008Bryan Caplan wonders if oil prices are a bubble.
When oil spikes abruptly, that means people made incorrect investment decisions – under invested in exploration, development, and gas to liquids conversion.
A simple back of the envelope calculation tells me they are still under investing. Exxon recently abandoned gas to liquids plant that would be profitable if oil remains above forty dollars to fifty dollars a barrel. But if everyone acts like that – and everyone is acting like that – oil is going to be way above fifty a barrel.
Do I hear someone saying “Hey. Do you think you are lot smarter than the guys running Exxon?”
It is quite simple. For the price of oil to remain stable at present levels, we need to accommodate China’s industrialization by producing a lot more oil each year. The planned increases in oil production add up to peanuts. So the price of oil is heading up, and going to stay up.