The subject at the coffee shop, the office, down at the garage and around the kitchen table these days is oil; more correctly, the cost of oil. But most of the information being passed around is incorrect. Just yesterday I was told that there are more than 200 years of oil left in Alaska alone. That all of the oil from the Alaska Pipeline goes to Japan. And, that every oil container and tank in the world is so full that there is no place left to store it. I was also told that once the election is over, “they” will do something about these oil prices.
I figured that I may as well join in the conversation, so I threw in that Santa Clause was coming twice this year and the Tooth Fairy is cornering all of the world gold reserves. I expect my input to be repeated by tomorrow as the gospel and coming directly from an undisclosed, but reliable source.
During the conversation, I never heard anyone say that oil is finite and that using 86 million barrels per day could potentially create a shortage. Nor that we have been warned about an energy shortage for more than 50 years and failed to plan.
My personal opinion of why I don’t hear the truth being bantered around nearly as often as the fables is that the thought of oil running out in a country that runs on oil ain’t something that most folks care to ponder for any length of time. Doing so gives a body the same kind of headache as trying to determine how the universe could be infinite. And thinking about that is what made Albert Einstein’s hair stick out.
Over the years I have observed that anything that appears to be life altering is side stepped like a coiled rattler. Our government is no different in that respect and our method of planning has therefore become known as “The Advanced Method of Crisis Management.”
Our monetary system is in every bit as much crises as oil. The Federal Reserve was a bad idea in 1913 and isn’t getting any better. Our physical system (that of matter and energy) must be balanced with our monetary system to operate long term, but it’s not, printing money is infinite.
I often refer to M. King Hubbert, the American geophysicist (October 5, 1903 – October 11, 1989), who pointed out as early as the late 20s that, “A reasonable co-existence (between our physical system and our monetary system) is possible [only] when both are growing at approximately the same rate.” In other words, as resources and population stabilize or go into decline, we can’t continue to print more money…but we do.
Mr. Hubbert also pointed out that charging interest at any rate above zero automatically creates the necessity of exponential growth in the money supply. We call it inflation.