Time to bet on America and the Dollar?

[globaleconomicollaps]

Re: Time to bet on America and the Dollar?

3 years makes a big difference. 3 years ago, America was bogged down by the war in Iraq. 3 years ago, Motorola was dying.

Today, America is making a huge come back.

Google Phone, Apple Phone, Google TV and soon Apple TV.

In major cities, half the people are using iPhone, the other half, Google phone. Almost all handhelds are iPads.

Gas is almost free in America, while the rest of the world pays an arm and limb for the commodity.

Food is cheap in America. Food cost more in Shanghai than in New York- real food I mean, not recycled oil, antibiotics and grow hormone laden meats and fruits.

Real estate is cheap in America. Come to China, people pay 30 year's wages for a 800 sq ft 60-years leasehold apartment that starts crumbling apart after 3 years (drywall material). No money for old age healthcare and retirement cos the apartment has no resale value after 30 years.

I think that America has benefited enormously from a strong euro, with the stock markets strongly correlated to the euro for the last 8 or 10 years( I will try to dig up a graph about that). This trend is about the reverse in a big way. I wrote about this on my blog:
http://www.itulip.com/forums/entry.php/175-euro-parity
http://www.itulip.com/forums/entry.p...uro-Trajectory

But the main thing to note is not this or that country going up or down in comparison to each other , but that every country everywhere is heading down the rabbit hole of hyperinflation. This has been going on for a long time, but people will wake up to the reality of hyperinflation in 2013.

[flintlock]

Re: Time to bet on America and the Dollar?

Rather than a win/lose situation between the US and others I have a feeling it will be a Lose/Lose one if the oil supply is interrupted. Knowing I'm doing better than my neighbor is still little comfort.

[lektrode]

Re: Time to bet on America and the Dollar?

from what data eye have seen, 85% of US oil imports are used for road fuel?

its concievable that upwards 50% of that is 'discretionary' and could be diverted ?

converting 'non discretionary' use/vehicles to natgas would seem to be an option in the short term. (at least until the supposed easy/cheap stuff was gone)

it also seems that there is still PLENTY of conventionally recoverable oil left within The US, that is simply not being addressed due to POLITICAL BS

it would also seem that the longterm (20years) solution (nukes) is also being ignored due to POLITICAL BS.

my conclusion?

MOST OF THE ENERGY/ECONOMIC PROBLEMS ARE POLITICAL
and NOT technological nor due to 'scarcity'

we need to have grownups working on solutions - as opposed to the scared little children that want to focus on stuff like gender and racial equity and 'fairness' in all aspects of the economy that seems to occupy most of the attention of most of the political class.

meanwhile the economic discussion has focused for the past 4years on how we can make things better for the TBTF industry?

while most of The Rest of US are occupied with survival.

seems to me this is The Big Disconnect that is the REAL cause of the problems we face today and methinks also that oil is the least of our worries.

[aaron]

Re: Time to bet on America and the Dollar?

it also seems that there is still PLENTY of conventionally recoverable oil left within The US, that is simply not being addressed due to POLITICAL BS
.

That is a meme being pushed by politicians and media these days. I am sure there are some places that a few companies can drill and make money. But, is there really enough oil to make a lick of difference?

[Bundi]

Re: Time to bet on America and the Dollar?

This view is opposite to what EJ said, something about the US being the only 1st world nation with a 1960s era cheap oil dependent transport system.

As for oil dependency:

http://www.sfgate.com/cgi-bin/articl...#ixzz1oFlxREos



Now 18% of the total US oil supply might not seem like much, but that is nearly 3.5 million barrels of oil per day.

That's more than any nation in the world except China (8.2 million barrels/day) and Japan (4.2 million barrels/day).

Let's not lose sight of the forest for the trees.

The article may improperly group all sources of "petroleum" or "oil" with sources of actual crude oil. The EIA does break this out, with a little digging it is apparent. If just focusing on crude oil (relevant approach unless all other petroleum products are 100% substitutable with crude oil) then in the US during 2011 roughly 61% of our crude oil supply was imported. This compares to the article's assertion that 49% of current US crude oil is imported. For the record, in 1984, the US imported only 28% of its actual crude oil supply, again EIA data.

Defining "oil" may be helpful in these debates. Currently many in the media group nat gas liquids, biomass, etc... with crude oil and call it all oil. This is ok I suppose but it would be helpful to disclose this in these articles.

Also, if we are going to switch all our cars over to compressed or liquid natural gas, we should keep in mind the unit price for those is not currently the much discussed $2, it is more like $6.50 or so I have seen. These prices are for current uses only and do not reflect what the price might be if auto demand starts to be factored into the demand mix. Conveniently forgotten in the nat gas conversion assumption is that conventional natural gas production was declining in the years prior to the shale gas boom. Why is this? Shouldn't we respect this fact and understand it prior to making assertions that nat gas is cheaper/cleaner for autos. Also, how much shale natural gas is in reserve in the US? I would love to know more about this dynamic as well before taking the sanguine view that we can withstand an oil spike by converting transport to nat gas. None of this is to say that nat gas won't have a more prominent role in the energy supply for the US, just that we should understand the timing, costs, and differences in performance relative to oil before assuming all is well.

[c1ue]

Re: Time to bet on America and the Dollar?

The article may improperly group all sources of "petroleum" or "oil" with sources of actual crude oil. The EIA does break this out, with a little digging it is apparent. If just focusing on crude oil (relevant approach unless all other petroleum products are 100% substitutable with crude oil) then in the US during 2011 roughly 61% of our crude oil supply was imported. This compares to the article's assertion that 49% of current US crude oil is imported. For the record, in 1984, the US imported only 28% of its actual crude oil supply, again EIA data.

A newspaper article with wrong facts? Unbelievable! /sarc

On a serious note, I would like to look at the EIA numbers you refer to: please provide a link.

I don't think that the numbers from the EIA referenced by you change the gist of what I noted above: that US dependence on imported oil is neither cheap nor easy to wean off of.

[Bundi]

Re: Time to bet on America and the Dollar?

A newspaper article with wrong facts? Unbelievable! /sarc

On a serious note, I would like to look at the EIA numbers you refer to: please provide a link.

I don't think that the numbers from the EIA referenced by you change the gist of what I noted above: that US dependence on imported oil is neither cheap nor easy to wean off of.

c1ue, sorry if my post came off in a bad way. Of course newspaper articles are going to get some things wrong, no surprise there. Also, what is right or wrong is a lot of times a function of definitions and context. I am very much a novice in the energy world so please take any comments with that spirit, certainly that is how I mean them.

That said, I respect this site and make an honest attempt to think before I write and to most importantly try not to post incorrect data. In other words, for a topic as important as this one, I don't want to be the one to cry wolf or suggest a trend that may not be backed by data. I did put in some effort to establish the data and context. Here are the main sources of information I used from the EIA. Getting to the total picture required taking some time with the data but I think the links will be helpful in showing the work, so to speak.

Again, my apologies if my prior post (or others) was not respectful. I very much appreciate your feedback on these topics and that of others as well. I really just want to learn and given it is my first time digging into EIA data, I am open to critical feedback on my conclusions, welcome it actually.

US crude oil and condensate production 1980 to 2011, annual
http://www.eia.gov/cfapps/ipdbprojec...2011&unit=TBPD
US crude oil imports 1984 to 2009, annual
http://www.eia.gov/cfapps/ipdbprojec...2009&unit=TBPD
US total petroleum products consumption 1980 to 2011, annual
http://www.eia.gov/cfapps/ipdbprojec...2011&unit=TBPD
US crude oil production and import, natural gas liquids, other liquids over various historical periods, annual (need to select “download historical series”)
http://www.eia.gov/dnav/pet/pet_sum_...mbbl_a_cur.htm

[flintlock]

Re: Time to bet on America and the Dollar?

Watched an episode of "Top Gear" the other day. They went to China to drive the new cars being made there. While Detroit has nothing to fear right now it seems, it was amazing to hear how many more cars are on the streets of China today than just 5 years ago. Its growing exponentially. This can't bode well for a nation so dependent on oil as the USA.

Also amazing what total blatant ripoffs the Chinese are pulling off. Somewhat bad copies of many European cars. No respect for patents there it seems. So how do our leaders justify doing business with a nation that has no respect for intellectual property? The answer has a lot to do with this quote from EJ's latest column I suppose.

Too much foreign debt is the amount that causes a nation to stop making political decisions in its own interest.

Why should American manufacturer's continue to refine their designs if the Chinese will then be allowed to steal them and sell them back to us? I don't see how anyone could be betting on the US unless something changes.

[Milton Kuo]

Re: Time to bet on America and the Dollar?

Also amazing what total blatant ripoffs the Chinese are pulling off. Somewhat bad copies of many European cars. No respect for patents there it seems. So how do our leaders justify doing business with a nation that has no respect for intellectual property? The answer has a lot to do with this quote from EJ's latest column I suppose.

Too much foreign debt is the amount that causes a nation to stop making political decisions in its own interest.

Why should American manufacturer's continue to refine their designs if the Chinese will then be allowed to steal them and sell them back to us? I don't see how anyone could be betting on the US unless something changes.

The American manufactures should continue to innovate because, outside of protective trade legislation, that is the only way they'll be able to stay in business as independent enterprises. In addition to creating products of sufficiently high quality to justify their higher production costs, American manufacturers need to do a better job of designing their products in a way that make IP theft much more difficult. Where IP theft is impossible to prevent, the American manufacturers need to have better marketing/propaganda campaigns to encourage consumers to not buy the Chinese products.

The Chinese will never become wealthy as a society at the current rate they are going. A few handful of people such as the well-connected owners and managers of the SOEs as well as members of the Politburo will get rich as they skim off from the labor of the masses. However, the masses will only be afforded the opportunity to become wealthy if Chinese companies are able to produce something that others cannot, either due to intellectual property protections or due to difficulty of producing a product or service.

One only need look at the notebook computer industry to see what life will be like if China and other mercantilist Asian nations continue their ways. No one "invents" anything. It's like a Mexican stand-off where each of the players is watching and waiting for another player to make a move, take a risk on innovation. If the move is successful (successful here only refers to financial success, it does not necessarily mean elegance of design success), the others quickly and mindlessly copy it. The process is to let someone else assume all the risk of R&D and business development and, if the product is commercially successful, jump in with copycat products in a mad race to zero.

As far as I can tell, over the past decade, Apple is the only company that has tried new things with their notebook computers; almost every other company just copies whatever Apple does or, in some instances, do their own thing (which is likely on a wrong path) which no one likes and thus remain niche players. It's partcularly irritating that even ideas that I think are bad--such as low-quality, low-resolution, wide-screen panels and chiclet keyboards--are copied.