Visual Guide to the Financial Crisis

I found a great visual guide to the current financial shake up. It doesn't include everything (it stops going down the rabbit hole at 'falling home prices') but it does illustrate the amount to which a flawed narrative can cascade through the system, causing a illusion of prosperity. I call this system the 'free market' in all of its iterations, both up and down

Click here for the link

http://www.ritholtz.com/blog/

I think what we're seeing a two-fold development: the (potential) on-going failure of narratives that don't include or take into account peak oil. And two, (potentially) the beginning of the failure of our cultural narrative of progress. I don't want to sound the funeral bell for this idea of 'progress' quite yet, but overall its not looking good. The market will probably rebound at some point, and the economy as well. The question is what ceiling of economic activity will cause energy prices to skyrocket again? In the coming decades that ceiling will be getting lower and lower, and the lowest price of energy will get higher and higher.

Solar Panelists for December

The December 10th meeting will feature a discussion on Solar Panels. We'll have Solar Panel Installers presenting, as well as someone from Austin Energy talking about the solar energy rebate.

Looking ahead to January, we'd like to invite neighborhood and local action groups into our meeting. Our goal is find out where our interests overlap and what action can be mutual action. Certainly, there is power in numbers.

Speaker Michael J Osborne of Austin Energy

Michael J Osborne, of Austin Energy, was kind enough to stop by our monthly meeting and say a few words about Austin Energy's efforts to lead the way in energy efficiency, and how the organization is charting its way into the 21st century - a century sure to be marked by energy scarcity rather than abundance.

I thought the most interesting part of his presentation was talking about a vision of replacing the current 'base load' of energy - the fraction of power plants that are always 'on' - with renewable energy. Slowly, of course and perhaps that base load will always include a fraction of traditional energy. This to me really seems to be moving past the rhetoric, moving past the ideals espoused by so many in the peak oil movement, and getting down to brass tacks -- exactly HOW we are going to make the transition from traditional energy into renewables.

Talking about wind and solar power in Texas, this is a reality happening NOW. Of course my belief is that renewables will NOT allow us to live as we are right now ... conservation and 'cutting back' will HAVE TO be a part of our future energy use. But the future won't be the dark ages, we will use some form of energy to heat our homes and to power mechanical devices -- as humanity has always done.

I think the choice is between saying the future will be awful, which inspires fearful complacency -- and saying that we can use our immense bank of fossil fuels to build an infrastructure of renenwable energy - wind farms, solar panels etc.

The peak oil movement needs to take a cue from Al Gore - that narrative MATTERS. Immensely. The peak oil movement needs to coalesce behind a narrative, not for the sake of conformity, but for the sake of DOING SOMETHING rather than simply being helpless seers of an energy-poor future.

Oil at $67?

Who knew that oil could possibly go this low? I'm sure that many in the peak oil community are a little shocked by this recent development in oil prices. I think we judge the credibility of informational sources by their predictive ability, and certainly 'peak oil' as concept has taken hit in the last few weeks especially. Looking at oil prices seems to bear that theory out, but looking at the larger context of the economy reveals a new wrinkle in the peak oil story.

I think the latest conceptual thinking of peak oil theory has been enumerated by John Michael Greer, who wrote "The Long Descent". It's a great work on peak oil, and somewhat of a departure from the norm of peak oil discourse.

The most important point that he makes is the idea of 'living through history -- that is, the human conception of time, and the truncated timelines of our history texts. This might sounds tangential to the topic of peak oil until we examine the narrative of the peak oil movement: collapse, disaster, starvation, famine, war, failed economy, etc. Not to say that these events won't happen, but we will probably be hard-pressed to link these disparate events back to the over-arching theme of peak oil.

Ultimately our experience, our lived experience will not be a sudden moment of calamity followed by an 'ah-ha' realization that peak oil is the man behind the curtain...rather we will experience decline, unyielding and progressive, followed by period of 'recovery' once again leading to decline. The slow parabolic unraveling of the 'western' mode of life.

To bring it back to the price of oil, why is oil at $67 a barrel, and still falling? We have perhaps entered one of the first of many 'minor calamities', the small disasters that will bleed western economies by 1,000 cuts. Its no mistake that oil hit $147 a barrel before it began its steady decline, we are likely to see each period of decline start out with rapidly inflating oil prices, as the recovery phase seems like it will restore the lost wealth and prestige of our economy. But this is an illusion, as the era of easy energy, and easy, cheap 'work' that it did for us are over. Now the true cost of oil will become more and more apparent before the economy sinks once again and oil prices are slashed along with falling demand.

Public Transit

From the Steering Committee meeting: Crude Awakening will begin to focus more of its attention on public transit, as an actionable outgrowth of the peak oil problem.

Peak Oil is beginning to be evident in the prices especially of gasoline, and high prices are causing all sorts of behavioral changes, most notable is a increased reliance on public transit, biking and walking. Thus a focus on enhancing existing networks of efficient transportation seems to be a good use of the group's energy, and a sensible response to the problem of Peak Oil in Austin, Texas.

This does not mean of course that Crude Awakening will neglect other aspects of the Peak Oil problem...certainly plenty needs to be accounted for. It does mean however that Crude Awakening recognizes that in addition to personal preparation, that the entire community needs to work together for solutions, and that solutions that only involve individuals will be inadequate to ensure a smooth transition to a more efficient, less energy-intense mode of living.

Twitter as an Organizing Tool

Crude Awakening is on twitter: @crudeawakening . Twitter is SMS/Web updates about the status of our organization. To receive Crude Awakening's updates to your phone (information about local meetings, field trips, conferences and peak oil news) simply text this message (minus the quotes): "follow crudeawakening" to the phone number 4040-4 . It will ask you for a user name - text one back and you are set getting updates to your phone. Please be aware of your texting package because twitter isn't totally free on that end...

If you aren't familiar with Twitter, you should be. A free SMS/Texting tool, if twitter seems totally pointless its because organizations haven't yet taken advantage of twitter on a large scale...at least they haven't gotten much attention for doing so. Many large news organizations are on Twitter, and Barack Obama recently announced Joe Biden as his vice president via Twitter.

Twitter allows one person from a phone OR from the web to send out announcements to anyone "following" them. The advantage of using Twitter over regular texting is that you don't need to know everyone's phone number, and you can be "followed" by people you've never met. In this way Twitter allows a two-way flow of followers, rather than the 'traditional' method of having to collect numbers or email addresses.

From a designer's standpoint Twitter is great because it allows you to totally customize the background image for the page...something that myspace allows, but not anyone else (not facebook, not meetup...) This might sound like a detail, but when it comes to branding its important especially in the age of such diversified branding spaces (social networks).

The Oil Drum @theoildrum is on Twitter, and I'm sure other peak oil sites aren't far behind. I think one of the biggest barriers to adoption of this technology by peak oil groups is a reluctance to embrace new technology in general -- because of a fear that it might go away soon. While those fears may or may not be justified (I would wager they are) we live in the present moment. And in this moment, Twitter is a great technology and a great way to organize. So let's get over it. Oil's going away but we still drive...so let's use the 'now' to prepare for the 'soon'.

Motorcylcing Chernobyl

Found the strangest blog -- about a woman motorcycling through Chernobyl. Apparently the radiation isn't uniform, the winds spread it unevenly across the countryside. She carries a Geiger counter with her on her motorcycle. The pictures are utterly amazing, and whats more, the stories about the men fighting the fire, and the villagers who went to watch the initial fire, totally unaware that they were looking into the burning guts of a nuclear reaction. I can't fathom going into Chernobyl on a motorcycle, but what a story!

Click here to go to her blog

More psychology

NOTE: I'm not a psychologist, and I don't play one on TV. These are my opinions after being in the world for a few years, and not scientific fact: I've met more than a few people who are gravely concerned about peak oil. And rightfully so. For someone who has just discovered peak oil, the shock of the information can be pretty overwhelming and the emotional response can be strong to the point of bordering on the physical (tightness of the chest etc).

I'm not a trained anything, but for me the most important thing in that kind of situation is to allow your body and your mind to act and react. Now that sounds strange and maybe a little obvious I know -- but the immediate danger is that a person in a state of panic doesn't allow themselves to move beyond the panic. They keep rehashing the facts in their mind, and as a result keep themselves in a state of perpetual shock.

You don't need a Ph.D. to realize that this mind-state is extremely unhealthy. We need to let the information affect our minds and our bodies without trying to relive that experience. This is not always easy, especially with stressful abstractions like peak oil: we are problem-solvers, and if the problem cannot be easily solved we are in danger of fatigue.

After the initial shock of the new, there is a shaking off, and a period of calm that can be had if we have enough awareness to let the more 'animal' part of our brain take over. The reptilian brain is reactive, effective and totally illogical -- that being said, it allows animals to do what humans have a very difficult time doing: moving on. And thats what we need to allow ourselves to do - to move on!

Again, this sounds like easy, obvious advice, and thats the point. We tend to make things more complicated than they are. For example: many people talk about 'running to the hills' to 'escape' peak oil and its various affects. For most people this is a radical change of lifestyle, and personally I think that it doesn't matter.

We need to stop thinking in terms of things we are going to do to our life, and start realizing that we are living our survival each and every day. For instance today someone found out about peak oil, and now they are worried, panicked and unsettled...all normal reactions. But is that person going to allow themselves to cling to an old paradigm, to deny, or worse yet to try and change everything around them so they themselves don't have to change? What we need to realize is that our reaction to stress and worry IS our survival. If the very thought of peak oil traumatizes a person into inaction, then how will long lines at gas stations affect them? Even if they have moved into the country and stockpiled food, if their psychology is not prepared to roll with the punches, then that person is in just as much trouble as anyone else.

What need to is not NECESSARILY food rations -- what we need more than anything, right now, in this moment, is the ability to roll with the punches, to change. Not unfeeling, but to evaluate the situation as it presents itself, and realize that we need to adapt to that world, and only that world which presents itself. So feel that panic, that worry, that helplessness, but be aware; its only a reaction. And then get on with it.

Pivot Point

I like the concept of a pivot. To me it is the pin on which something rotates, but the implication is that the pin itself does not more, but rather is a fixed point, a reference. When we think of history, we tend to think of pivot points, of 'pivotal' junctures in history where the entire structure of human events shifted...

As I'm interested in the history of oil, I tend to view much of history through the lens of energy, as a quest to acquire the best, most secure supply of energy. The United States in the 20th century was remarkably gifted with a vast supply of oil, and ever since its production hit peak in the early 1970s, it has done well not only to control but to assure a steadily increasing supply of oil.

I can't say with certainty what events will be important to historians in 200 years, or even in 5 years. Personally I believe the decade of the 1970's was the critical pivot point in the history of oil, which more than centuries and more than political or philosophical movements will bracket modernity. Modernity has always been about speed, and speed, in the modern world, was delivered by fossil fuels.

In the 1970's it became evident that the US was no longer the swing producer for the world...in other words the US no longer controlled the world price of oil, as it no longer controlled the excess supply. The 1970's showed the world the price of relying on fossil fuel and the oil shocks in the early 70's led the drive towards conservation and prudence.

The 1970's also gave us the Carter Doctrine, which stated that the US would use military force to defend its 'interests' in the Persian Gulf. I'm sure such policy has always been in effect, but to state it with such rawness and boldness signaled a new era in elite and public consciousness about oil.

Much of the ramifications of the 1970's were obscured by the Saudis, who stepped in to fulfill the role of swing producer, and by the deregulation of the financial markets in the 1980's.

Before the 1970's, oil had mostly been a regional issue, and where the world had been concerned there was always plenty of oil. Instead of dealing with the obvious problems of an oil addicted world, the US choose to pursue more oil resources, to drill more, to find other sources of this valuable energy.

And yet the problems of basing an economy and a society on oil -- those never went away. They were simply deferred by 30 or so years. And now, once again, we are waking up to the grim reality that the reality has NOT changed, that oil dependence has gotten worse instead of better AND the fundamental problem of an addiction to a depleting resource was still in play.

The world pivoted in the 1970s. The momentum of the Saudis, of the North Sea oil, of Prudhoe Bay in Alaska -- those discoveries carried further into the age of oil. But the truth is that we're dealing with a shift that took place almost 40 years ago and once again the world is on the cusp of a great pivot. I can't say what that is, but I doubt very much that it will be easy, and I doubt very much that the world has ever seen anything like what is coming in the next 30 or so years.

We live in a fascinating time.

Great Quote

"I suggest that this is a good time to think soberly about our responsibilities to our descendants – those who will ring out the Fossil Fuel Age," said Adm. Hyman G. Rickover, father of the nuclear Navy.

I found this in an article by Rod Dreher, who wrote a great piece in the
Dallas Morning News about why America is psychologically unprepared for the ramifications of peak oil - mainly the belief that we can do whatever want without incurring unintended or negative side effects. I still believe in the future of this country, its just hard to see so many people living so foolishly, and so selfishly, and to believe that they will make moral and ethical choices in a time of scarcity, when all we've been raised on is the philosophy of unending abundance.

I believe in the fundamental goodness of people. I also believe in their capacity to do evil. The wildcard is usually the choice between the two.

Georgia-Russian war: Energy Conflict?

I watched an amazing segment on Democracy Now about the Russian - Georgian conflict. I was honestly surprised to learn that it was pretty much exclusively about oil, I guess because the mainstream media really seems to focus on democracy blah blah blah. Network news is junk food for the mind.

Michael Clare, author of Rising Powers, Shrinking Planet, talked with Amy Goodman (The anchor for Democracy Now). He mentioned the pipeline built with the urging of the US during the Clinton administration -- and how that pipeline was an attempt to undercut Russian political and economic power over Europe. The strange thing of course is why Georgia would have risked provoking its much more powerful neighbor, and Klare speculates (though I should add without conclusive evidence) that the Neo-conservative faction in the US government led the Georgians to believe that the US would lend more significantly more military aid then was actually politically feasible.



And now because of the conflicting foreign policies coming out of the US (the neo-con faction and the State department) Russia is now within easy striking distance of the pipeline, giving Russia significant economic and political leverage against Europe, NATO and to a certain extent the United States. At least for now.

Sometimes I get nostalgic for the chessmasters of yester-year. It occurs to me that Henry Kissinger was an evil bastard, but at least he could recognize the 'game'. The Neo-Cons seem to be evil and totally clueless. That doesn't make them any less dangerous of course, but instead of worrying about the relative strength of the US, they seem to concerned only with their own exceedingly narrow goals. They seem to myopic and totally inflexible. I'm surprised they haven't been shoved out of power yet.

Overbuilt market...

"Overbuilt Market creating modern ghost towns"
-View the MSNBC Article here.

Peak oil is a strange phenomenon. One year ago oil at $100 a barrel would have been inconceivable for all but a few commentators. And yet here we are, oil is hovering around $115 a barrel and people are actually celebrating! And so the cycle has begun, with a run up of prices (it was only a month ago that oil hit a high of $147 a barrel), demand destruction, followed by a drop in price...then the inevitable run up of demand as people adjust to the new price regime and the following run up of price. And so on and so forth. IT DOESN'T HAVE TO BE THIS WAY. If we let the market dictate price then it will be this way, and probably much worse. If government were to put a floor on gas prices, then people could actually begin to act like rational consumers instead of following the completely irrational marketplace for global crude.

Back to the headline: The 'Overbuilt' Market of homes. Home builders are going out of business because of increasing costs and decreasing demand for houses built on the periphery of cities.
There's even a website devoted to this: The Home Builder Implode-O-Meter, monitoring the decline and fall of the home building industry.

It makes me wonder what kind of cycles we will start seeing with the fluctuation in the price of oil and gasoline. As gas gets cheaper, will ex-urban houses enjoy a brief renaissance before being crushed once again by the run-up in price? Or will buyers wise up after the second or third boom and bust cycle?

I think what we're probably witnessing is the extreme boom and bust cycle returning to America. Where during the 1980s and 1990s the US enjoyed a relatively stable economy untroubled by massive oil shocks, the economy of the new millennium will not be so lucky. We don't have the global surplus of crude oil to stabilize the world (or local) economies, not like we did in the 1970s.

Video Archives

CrudeAwakening.org now is presenting videos! I'll be updating them on the homepage as well as on our video archive page. It's new and expect it grow rapidly, especially as Matt Simmons, Richard Heinberg et al. are appearing with increasing frequency on the cable news shows, and as Peak Oil is increasingly visible throughout the mainstream media.

If you have any embed codes, interesting videos or audio samples, please email them to jon@crudeawakening.org

The latest is Richard Heinberg talking shop on Al-Jaazera TV, see above

Get out of Debt -- NOW!

That's all. This isn't an admonishment for spending too much on a credit card, or for possessing large levels of debt. It doesn't matter where you are, but rather to recognize your current level of debt -- and prepare for peak oil by GETTING OUT OF DEBT.
As much as possible do this, especially on credit cards and smaller loans that are easier to pay back. Many people who come to meetings have a bit of a panicked look about them, and are wondering how they can best prepare for peak oil. Decreasing the amount you owe is a great way to start, and smaller interest payments will leave more money in the pocket to save, or to continue paying down debt.
As individuals and as a nation we've taken on an incredible amount of debt. One thing that is for certain is that the standard "business as usual" model of infinite growth will not continue. And that means rates for borrowers (and lenders) will increase rather than decrease. All this means is that individuals will make less money each year and face increasing credit rates.
Reduce your vulnerability to this trend by paying down debt now, when you have the spare assets to allow you to do that.

Call for bloggers

Crude Awakening has undergone quite a few changes in the past few months. We've totally revamped the website, going from a static site to blogs, calendars and updating content. We changed the look, and hopefully made information easier to access. We have also give the site a new look, and we're currently working on a complete re-branding package, complete with business cards, letterhead and of course a matching website.

The next step in the evolution of crudeawakening.org is to get a variety of voices from different walks of life to comment on peak oil, on an energy-aware life, on psychology and whatever else comes up.

Please contact us at info@crudeawakening.org if you are interested

Thanks!

CrudeAwakening.org Staff

They Finally get it?

The Mainstream Media (or MSM for those in the know) have been reporting more and more about oil, gas prices and the state of oil production in the world. And yet even as recently as a week ago, MSNBC.com could run a story about the 'end' of the energy 'bubble.' Stories about gas prices, from sources, seemed to miss the crucial detail about supply and demand. China has taken the blame for increased gas prices, even though per capita the average Chinese citizen uses 1/5 of the energy that the average US citizen uses.

Those days are over, on MSNBC.com and at the Washington Post, a new editorial era seems to be upon us: "Global Pressures Forge a New Energy Reality" trumpets the Washington Post. Citing supply and demand factors, as well as the growth of China, the Post makes the bold assertion that gas prices, particularly for those in the US, will not ever retreat back to prices seen in the late 60's or during the decade of the 1990's.

This is not exactly acknowledging peak oil, the author hems and haws in typical DC fashion, but make no mistake the article lays out the current world situation, however, without taking the next step -- that is to try and imagine a world suddenly being deprived of cheap, abundant oil.

I imagine that step has to wait for the markets, that is the short term energy traders, to catch up, and really look a year or two down the line and realize whats coming. I doubt any news organization wants to be blamed for mass panic, but given the government's total inability to do ANYTHING (see Katrina response) a small, tight feeling of panic in everyone's stomach might motivate them to go out and DO SOMETHING.

I think the real lesson here is that we in the Peak Oil community need to continue our focus on research and out reach but realize its no good waiting for others to come around. WE ARE RIGHT, and the debate is officially over. Of course, life intervenes, and theres no way to absolutely know the future -- but if you want to get a good idea of what the next 50 years will look like, then the peaking of resources available to humanity is a good place to start.

When historians look back on this age, they will probably date this century as starting in 2008 -- the first time the world is staring into the abyss. Unlike the 1970s, there is little spare capacity in the world...theres no way out of this one. The age of scarcity is upon the mainstream.

Energy reality

It seems that everyone is talking about $4 gasoline. There’s a lot of opinion about what is driving that, what effect it will have on our economy, will it continue to increase, what can we do to increase production, develop alternatives, etc; powerful political and industrial figures are proposing solutions to “drive down the price at the pump”. But, before we all get bent out of shape over what we pay for gasoline, we should try to get a better understanding of what the energy contained in that gallon of gasoline is worth to humans.

A fit, healthy person can generate 200 watts of power to do work; and given the right circumstances, can do that for 8 hours a day. They don’t do it leaning on their shovels, either; we’re talking about hard, grueling work.

A gallon of gasoline contains 33.530 KiloWatt-Hours of energy ( = 33530 Watt-hours), so 33,500 Watt-hours/gallon ¸ 200 Watts/person @ 168 person-hours / gallon.

So we see that there are about 168 hours of a person’s equivalent energy contained in a gallon of gasoline. That’s about equal to a month’s worth of 40 hour weeks, so the human-energy content of a gallon of gasoline is approximately equal to one month of human work.

Now, the USA consumes over 388 million gallons of gasoline per day, so 388,600,000 gallons/day * 30 days/month @ 11.658 Billion gallons/month and, 11.658 Billion gallons/month * 1 person-month/gallon @11,658,000,000 persons.

In plain language, we in the USA are utilizing a workforce of more than 11.6 billion (that’s with a B) human-energy-equivalent slaves working 40 hours per week, 52 weeks per year to fuel our trips to the mall, idle at teller machines, take business junkets, blow leaves around our neighborhoods and take cross-country vacations every year – among other things.

Gasoline is currently selling for ~ $4/gallon, so the cost of our energy slaves today is 388.6 million gallons/day * $4/gallon ¸ 11.6B persons @ 13¢/day/person. Thirteen cents per day per person. It’s no wonder that we squander an irreplaceable (therefore, priceless) resource on trivial activities, it’s too damn cheap!

Oil Bubble? Lets not be hasty...

From MSNBC.com:

"Given the market’s inability to spark a larger rally Friday following the week’s big sell-off, is it time to declare the energy bubble over?"

[Full article]

This just shows the shallowness of mainstream reporting -- and that despite the meteoric rise in oil prices over the last 6 months, that "peak oil" still has not truly transformed into a framework or paradigm for the vast majority of people.

It is also a strange thought -- that oil at $130 US a barrel would be thought of as the new bottom for oil. Whereas only a year ago oil at even $100 a barrel would have been counted as a calamity of the highest order.

I can't say where oil is going from here...focusing on the price sometimes diverts from the true issue at hand anyways. But I do know that oil at $130 a barrel is still far too cheap, and to accurately account for the massive amount of work that oil does for us -- and to ensure that our society keeps the transition momentum moving -- oil NEEDS to keep rising in price.

Despite the gloom and doom of a faltering economy, oil's rise has been slow enough to allow people to transition their habits, their mindsets and their spending. Problems will arise if oil skyrockets in price -- a sustained, even rise in price is the best case scenario for anyone who 'believes' in peak oil.

Demand Destruction

Watching gas prices rise in the last few months from under 3 dollars a gallon to a nation average of around 4.10 a gallon, I keep expecting a drop in price as a result of demand destruction here in the United States. Reading articles lately has left me with the idea that even though demand destruction will occur here in the US and throughout the world, that oil prices will not dip much, and certainly not to the extent that they did during the 1980s oil glut.

The reason can be summed up by the export land model, which states that a nation's oil exports will drop faster than their production rates because the nation will use more of its own oil and therefore have less available for sale on the world market.

Thus Mexico (for example), who is experiencing fast declines of oil production, is also experiencing economic growth which is using an increasing amount of its oil domestically. I read an article here that hypothesized that Mexico will have NO oil left for export, given current trends, by the year 2010.

Mexico, the sixth largest producer of oil in the world (as of 2007) at 3.71 million barrels per day, currently accounts for imports of 1.116 million barrels per day to the United States, currently third behind Canada and Saudi Arabia. ^[citation]

Between 2006-2007, while Mexico's production was essentially flat, its exports decreased by 15%.^[citation]

Thus, we will have to make other arrangements. And fast. Every single energy producer/exporter is going through this process and chances are that we may hit peak exports before we hit peak oil. Either way the energy available on the world market will be less and less, and perhaps much more quickly than peak oil production.

Break Point

I've been reading "A Thousand Barrels A Second" by Peter Tertzakian, a book about the peaking of oil production. Tertzakian introduces an interesting concept called the "Break Point", a society's re-evaluation point of an energy source.

In the past break points happened, for the most part, to coincide with the discovery of a more energy-rich, aka 'better' fuel, think of the transition of industrializing England from burning wood to burning coal, or the world-wide transition in the 19th century from whale oil to petroleum.

Of course history provides examples of break points where societies were simply unable to move to a higher source of energy / raw materials. Jerod Diamond has a couple of examples of such societies in his book "Collapse" but rather than refer to a scarcity of resources, Diamond typically seems to reference an over-abundance of people. In my mind these are one in the same problem, in our day and age we can look at the balance of population to available resources.

Our re-evaluation of petroleum hasn't nearly been hit, although we are noticing a minor change in driving habits. For the first time in 5 years, the number of miles driven in the US declined. Still our way of life is intact. I believe that in order for our society to truly re-evaluate petroleum, the price of gasoline will have to double or triple in price, as it did in 1973 and again 1979. That world was able to re-adjust its energy sources, and continue growing.

Our break point will be different. As we are approaching peak production in numerous areas (including, I believe, peak food, peak minerals, peak 'work' and peak wealth) we will also reach a break point in the American dream, the concept that anyone can be rich, the idea of perpetual growth and an ever increasing level of wealth and prosperity.

Our energy break point will quickly become a mental break point. Jimmy Carter's 'malaise' speech is mocked for its dour tone, but mark my words we will in the next 5-10 years hear a US president address exactly the same crisis of confidence, and within ourselves we will each have to reformulate (as we do many many times in our lives) exactly what it is we expect out of life and how we will exist within the limits imposed on us by our environment.