Thursday, May 24, 2007

Halliburton Putting 70% Capital Investment in Middle East

Actions speak louder than words. By putting its money where its mouth isn't, Halliburton reveals where it sees its future lying. J.O.
Iran-Iraq Pipeline

Granted, Iran has difficulty meeting its own domestic needs for gasoline but that's a refined product. Iran is still an oil exporter so this pipeline is puzzling. Since the Ceyhan pipeline is in jeopardy, its purpose could be to bypass the current instability in Turkey. Or it could be a European oil company outbidding the U.S. MCR

CO2 Emissions' Rise Outpaces Worst Case Scenario

This article underscores 's mantra that until you change the way money works, you change nothing. As long as the global economy continues to be a Ponzi scheme that relies on endless growth in a world that insists on remaining finite, we will continue our progress towards.... you fill in the blank. J.O.

Climate Change May Imperil Plants

Forget the notorious spotted owl, beloved object of ridicule of Bush I; climate change now threatens wild varieties of the humble potato and peanut. So who eats wild varieties anyway? you ask. Perhaps few do but as the article points out:

"Farmers and researchers often depend on wild plants to breed new varieties of crops that contain genes for traits such as pest resistance or drought tolerance, and that reliance is expected to increase as climate changes strain the ability of crops to continue to have the same yields as now, the group said in a statement." J.O.


Review of book on the "conspiracy theory" surrounding the JFK assassination.'

This review appeared in tandem with a bellicose review of Bugliosi's 1600 page tome asserting that Lee Harvey Oswald did it, period. The Bugliosi book had gotten front page coverage in the Times during the week so it's interesting that the Sunday Book Review is presenting a more balanced picture. J.O.

UK Cash Finances Terror, Says India
China's Seed-Breeding Satellite
Jon Stewart's "Misappropriation of 9/11"
Live Science Snowflake Gallery
The Inflation Lie
US government, Wall Street hide energy shortage and crisis with deceptive indicator

Larry Chin

In the past few days, news headlines have trumpeted and repeated what is a non sequitur, and a physical and logical impossibility:

Overall Inflation Eases, Gas Prices Up (Associated Press)

Despite Gas Prices, Inflation Eases (Boston Globe)

This nonsense as already become the basis for economic, political and financial decision-making across the country, and all over the world.

It is a lie. Here is why.

Rising energy costs are inflation. You cannot have one without the other. Energy, and energy-related material, is the lifeblood of modern industrial life. When the cost of energy (including oil, natural gas, electricity, and the products made with petroleum, such as plastic) goes up, the cost of everything goes up. This is inflation. When energy is depleted, while the use and demand for energy continues to increase, the price of energy skyrockets. Inflation, again.

It is a fact that the world is in the early stages of Peak Oil and Gas---permanent shortage, and permanent depletion. The world oil peak occurred in November 2005, according to renowned scientists, geologists and industry experts.

It is therefore a fact, with permanent shortage with high, rising and insatiable world energy demand, that rising inflation is not only a problem now, but also a permanent condition.

Why are the authorities hiding this?

Core inflation hides the truth about energy crisis

Simply defined, inflation is the increase in the average level of prices. However, there many different methods by which inflation is measured, and selectively reported by US government (primarily, the Bureau of Labor Statistics), the Federal Reserve Bank, Wall Street analysts, economists, the corporate media, and the rest of the US government.

There are, however, many different definitions of inflation. In recent years, the Bureau of Labor Statistics and the Fed have selectively emphasized one version, core inflation. Core inflation is the statistic that excludes costs of energy and food.

Given the fact that 1) daily existence in modern life demands various forms of hydrocarbon energy, 2) a vast array of basic material is derived from hydrocarbons (such as plastic), and 3) food and food production depend on hydrocarbons (fertilizers, irrigation and pesticides, energy needed to run machinery, etc.), the exclusion of food and energy costs in the measure of inflation is, therefore, a lie.

The selective use of core inflation is a cover-up that is routinely assisted by corporate media that, knowingly and unwittingly, promotes the illusion of a “growing economy with inflation under control, or non-existent”.

Meanwhile, what is the truth? Consider these:

Inflation looms as oil prices soar

Oil and gas project costs reach new highs

Gas costs $1,000 more annually than in 2001

The price of every form of energy (oil, gas, electricity) is going through the roof, as are other costs of everyday survival: health care, housing, and education.

In The Peak Oil crisis: alarms are sounding (May 17, 2007), Tom Whipple of the Falls Church News-Press writes:

“Across the world, alarm bells are starting to clang. Above every gas station, a large sign is proclaiming that prices are on an unstoppable climb towards un-affordability. In Paris, the International Energy Agency has announced that the demand for oil is likely to exceed the supply later this year, unless, of course, OPEC steps up production. In the Middle East, OPEC spokesmen reiterate time after time that all is well, there is plenty of oil, and there is no need to increase production…. The Chinese just announced that their April oil imports were 23 percent higher than last April’s. Iraq, Saudi Arabia, Venezuela---everywhere you look---there are unmistakable warnings of troubles to come.”

Ordinary people are being defrauded and lied to. It does not take a degree in economics or finance to see this. Even people who do not pay attention to the news intuitively know and feel the increasingly crippling effects of real inflation every day, at the gas pump and everywhere else. They are watching their money disappear. The crisis is palpable.

Will the real inflation please stand up?

If core inflation is a deceptive statistic, where, then, does one find a more realistic measure? That is found in what is known to economists as headline inflation. Headline inflation includes the cost of energy and food.

A few contrarian observers have pointed out that headline inflation tells much more of the truth.

Charles Bean, chief economist of the Bank of England said in August 2006 that the US Federal Reserve is wrong to focus on core measures of inflation that exclude energy prices. According to Bean, “it should focus on headline inflation, which is much higher. Including energy and food costs, US consumer price inflation is running at an annual rate of 4.1 percent, against 2.7 percent for core inflation”. He also pointed out correctly that energy prices were rising for the same reason the price of many manufactured goods are falling: the rise of China and other emerging market economies. Bean’s controversial statement came at the Fed’s annual Jackson Hole, Wyoming symposium. (Since Bean’s statement, energy prices have risen, which suggests that inflation is even higher than Bean’s 4.1 percent estimate).

In a piece titled “Inflation reporting errors continued”, Barry Ritholtz concludes that the Bureau of Labor Statistics has been “consistently under-reporting inflation over the past 8 years.” Worse, the amount of the discrepancy has widened dramatically, with “the gap between core and headline is now greater than it was in the early 1980s, and---hard as it may be to imagine---we are only slightly off the spread of the terrible 1970s.” The BLS and the Federal Reserve, according to Ritholtz, have deviated from reality, even though others around the world see the disconnect… “The basket of goods and services that is measured is so massaged and hedonically adjusted”, that it no longer reflects reality.

In Ritholtz’ view:

“The US consumer is confronted with rapidly rising costs for food, energy, health care, housing, education expenses. Indeed, even as both the everyday survival expenses (shelter, food, energy) and the larger family expenses (doctors, college, etc.) have exploded, there has been little correlation to what economists and the BLS have informed them. Despite the contradiction, there is little inflation in the official stats. It is as if economists are asking consumers, ‘Who are you gonna believe, us, or your lying eyes?’”

“If we are to judge inflation on a broader scale, we would undoubtedly come to the conclusion that, like the rest of the world, the US has an inflation problem.”

Ritholtz also notes that the highly respected Bill Gross of PIMCO (the largest manager of bonds in the United States) sees the same thing. Gross states: “A bigger threat to asset markets…comes not from slower economic growth in the short-term, but inflationary pressures towards the end of our secular timeframe. Since 1967, average differences in headline vs. core inflation have essentially been zero, despite distinct periods of cyclical variation. Now however, with globalization so dominant and Chinese/Asian appetites for oil, soybeans and iron ore amongst other commodities so voracious, it’s hard to envision an extended period of lower headline US increases.”

Here is a similar discussion:

Except for inflation, there's no inflation
In “Lies About Inflation”, Jack Douglas argues that the official measures of inflation, the Consumer Prices Index (CPI) does not include housing prices, which have soared in a Housing Bubble of recent years, and that education, retirement costs, medical and health care costs are grossly undercounted.
What are the US government and Wall Street working so hard to hide, and why are they hiding it? According to Douglas:
“The CPI does include the soaring costs of energy and food, so the Fed and the Big Media have cut them out by referring to the ‘Core CPI Inflation,’ which is a totally ad hoc number they get by cutting out energy and food costs. But have you ever met an American, or any human being, who could live without food or energy? The Fed pretends it is cutting out the heart and core of inflation by cutting out food and energy because these are ‘variable.’ But, of course, all prices are variable and this variability is the very reason one wants to keep measuring them: if they were not variable, it would be absurd to measure them more than one time.
“First, they do not want consumers to know that the American economy is in a desperate situation. If people knew the truth, they would save, not spend, and would insist the government stop running up immense debts to pay-off its rich Party members and fight unwinnable wars.
“If people saved, the Fed believes in Keynesian Ideology the economy would shrink, so they lie to get people to borrow and spend to pump-up the economy. The government and Fed poured out vast oceans of paper dollars over the past six years in a desperate Keynesian attempt to revive investment, income, consumption and growth to kick-start the economy after the Crash of the Nasdaq Bubble (created by earlier Fed floods of dollars to ‘pump-up the economy’) six years ago erased over 8 trillion dollars.
… “Second, they hide inflation to keep down the inflation-adjustment wage and retirement benefits to tens of millions of Americans at the lower end of the income scale, which saves big corporations and the government tens of billions of dollars a year.
“The Fed and the rest of the government failed to kick-start a real investment boom and growth. They produced an immense burden of debt, inflation, bubbles, and distortions of the whole global economy. Now all of that is unwinding faster and faster: we are spinning down faster and faster in a vortex of contraction that will most likely produce a ‘free fall’---a Great Crash.”
[Note: I do not endorse all of the political views of this web site. However, Douglas’ view is on target. -LC]

An honest, accurate picture of post-Peak Oil economic reality, and the resulting public outcry, would cause a systemic crash, stock market collapses, and the end of “consumer confidence”. Without consumer spending and debt, the fragile economy would lose one of last remaining legs it is teetering on. There would be no more “pump” in “pump and dump”, and the Wall Street casino would close.

Off the cliff, into the dark

Governments, corporations and policy makers all over the world have been aware of Peak Oil and Gas for a long time, and have engaged in desperate actions to prepare for its many effects, including inflation. On February 28, 2007, the US General Accounting Office (GAO) published a report to Congress entitled Crude Oil: Uncertainty about Future Oil Supply Makes it Important to Develop a Peak and Decline in Oil Production. The authorities simply do not want the public to be privy to their machinations.

The global architects who manage a teetering global system that profits from criminality and mass murder---who have lied about 9/11, and lied in order to wage illegal wars of conquest all over the world---would not hesitate for one second to lie about inflation. In the words of Mike Ruppert, author of Crossing the Rubicon, there are too many “psychological and moral limitations that no political leaders and few human beings can see beyond” to count.

The lying will not end. Far important is the need to develop the ability identify the lies, and deal with the reality that they are being told to ignore.

As Tom Whipple warns, there are immediate problems:

“…Right now, on top of every American’s agenda should be the question of whether we are going to get through the summer without shortages and gas lines---opinions are mixed.

“Earlier this week, Matthew Simmons of Twilight in the Desert fame, suggested that prospects for an uninterrupted summer of driving may be worse than government spokesmen have been letting on.

“Where does all this leave us? The short answer is, in an increasingly grim situation. When respected analysts say our gasoline situation is beyond the tipping point and that at least some of us are likely to be sitting in gas lines before Labor Day, we should heed the warning. Looking at the broader, worldwide picture, the situation is equally grim. When the normally staid International Energy Agency starts issuing a stream of dire warnings about shortages or much higher prices before the year is out, we should start thinking about a markedly different future.”

This future includes rising, and eventually permanent, inflation.


Rice Farmer said...

Just received a press release entitled "'TOP TEN' FUEL SAVING TIPS FROM FORD." Nice tips, but in the face of peak oil it's like trying to stop a Mack truck with your body.

BTW, nice to see a comment by MCR!

swift said...

Speaking of fuel saving tips they had a whole speal dedicated to that on NPR today I tried calling in and emailing to bring up peak oil but couldn't get through.

Rob said...

Hi copvcia and jo,

I am growing more and more concerned with the grid...with the peaking of petrol...sections of the grid will also fade to black. Marshall Law will follow with W as dictator. Mike do you maintain your earlier comment about the NWO NOT invading Iran...?
Glad to see you're alive and tickn'. Would appreciate a health update on you MCR!

Joy said...

I am so happy to see a comment by MCR. Hope your health is on the mend.

FTW admin said...

thanks to those who've asked about mike's health. he's doing a LOT better!

Rice Farmer said...

That's good to hear about Mike!

Now here's an article about sinking ships for tourism.

I doubt many ships will be sunk for this reason because they will be more valuable as scrap, which in fact is alluded to in the article.

swift said...

Thats great to hear I hope he keeps on getting better. We need him and others like him to stick around.

Rice Farmer said...

Now everybody is talking about "agrichar."

Don't get me wrong -- agrichar itself is GOOD. It is common for farmers here in Japan to burn sticks and limbs and agricultural residue on their fields and turn the resulting ash and char into the soil. But the visions of an "agrichar" industry ring warning bells for me. They are talking about collecting residue from fields, hauling it to agrichar plants, processing it, trucking the product to users, and applying it to farmland. That's a lot of energy!

Japanese manufacturers of bathroom and facial tissue just announced a 10% rise in their wholesale prices to cover the increased costs of wood chips and fuel.

Anne said...
Jenna, thought this might be an interesting post. On two subjects, peak oil and the possiblity of war in Iran, it says what FTW was saying years ago.

zenblkboi said...

Hey, so does this mean I should buy the electric Vespa I wanted?? Cause I am being persuaded out of it by my parents who think I am going to be hit and killed by a Hummer here on our Southern country roads.

Dino said... well, I am also happy to hear that MCR is doing well.

As the collapse continues, I would hope that this virtual community could explore ways for us to come together in a more physical community. I would take comfort in the thought that there is a community of people (somewhere) who think and communicate along the likes of MCR. And, who knows, maybe even our children will come to learn and appreciate the depths of individual rights and soveriegnty.

How does exploring the idea of us forming a living in a physical community sound to you?`s just an idea...

Rice Farmer said...

Zenblkboi -- I'm not sure what your expectations for electric cars are. Remember that oil is the foundation of the economy. Once the economy starts falling apart, everything will become far more expensive, and in some cases even unavailable. That goes for electricity, too. Further, roads and bridges will begin to fall into disrepair. So an electric car might keep you on the road for a while, or it might not. It's a big gamble, just like a gasoline-powered car.

One more thing to keep in mind is that electric cars are not "zero-emission" vehicles. That is just a load of crap. The electricity has to come from somewhere.

Rice Farmer said...

I just downloaded the 2007 Energy White Paper, recently released by Japan's government. Lots of attention given to oil, as you might imagine. I'll be looking through this to see how (or if) they deal with peak oil.

Rice Farmer said...

Public water systems falling apart.

Anne said...

Rice Farmer
Your last post relates to my growing fears of water becoming a commodity. Fortune magazine stated in a recent article that water would be to the 21st century what oil was to the 20th. Here in my small community the idea of putting meters on private wells is being sold to the people as a conservation measure. It is started by offering a free meter, plus $150. For many here, that amount of money can buy a lot of groceries. It is a stealth operation that eventually could put control of all water in the hands of corporations with the ethics of Haliburton et al.

What a concept! If religous fervor, crushing debt, endless war, and a poisoned food chain won't quite contain the masses...control their water. And what an effective way to cause a much desired (by TPTB) die-off.

Sometimes I wish we were closer to the end of oil. Horrid, aren't I?

outsider said...

I had heard Mike was in Venezuela, but have only learnt today that he is in Canada and recovering from a very serious illness (induced, I'd warrant; but then I am a 9/11 'conspiracy theorist'). Thank God he's recovering; Mike, if you read this, God bless, you've carried His banner of Truth and Justice in exemplary fashion.
The Venezuelans missed out on a gold mine of information and experience; Mike would have been invaluable as an advisor to their Foreign Ministry (their foreign minister is very pro-9/11 Truth).

outsider said...

I know this is a bit off-subject, but June 8th is the 40th anniversary of Israel's murderous attack on the USS Liberty (see '';''&Peter Hounam's 'Operation Cyanide'. Like 911,survivors and relatives await proper investigation.

Pandabonium said...

There is an excellent website where you can watch a 3 part 90 minute video called "Crude - the incredible journey of oil", produced by ABC Science (Australia). Covers where oil came from, peak, and climate catastrophe. Also has additional clips by such people as Collin Campbell, Sonia Shah, and other experts on oil and climate. Good site to refer uninformed people to:

Rice Farmer said...

I have not seen "Crude," but an Australian friend has, and says it is very good.

Rice Farmer said...

A couple of interesting news items from Japan. First, refiners have announced yet another round of price increases on petroleum products. Second, users of diesel trucks have been filling their tanks with kerosene at self-service stations because kerosene is cheaper than diesel fuel.

zenblkboi said...

Hey, I know that electric vespa's ar e not 0-emmision. but my parents are going to pay for that electricity, not me. And if everything gets more expensive, wouldn't an electric vespa be better for getting around. In the short term, I mean they only last like 5 years or so anyway?

zenblkboi said...

oh, also, has anyone read Cindy Sheehan's letter of resignation as the face of the Anti-War movement??

IT sounds EERILY like Mike's resignation letter!!!!!

Rice Farmer said...

Zenblkboi, I don't mean to be dumping on electric cars any more than gasoline-powered cars. If someone else is going to foot the electric bill, great! I just want to keep people from having false expectations that electric or hydrogen cars or whatever are going to save the car culture. The car culture is dead, D-E-A-D. Roll out the hearse while there's still gas for it.

Norway's Statoil Strikes Oil with Exploratory Well in the North Sea
Maybe 50 million bbl. As Norway is already in decline, it's another drop in the bucket.

swift said...

I thought that everyone should check this out this is a great independent news network,

Its a breath of fresh air if you havn't heard of it yet.

Rice Farmer said...

Japan's Petroleum Information Center has just announced that the price of gasoline has risen eight weeks in a row.

Rice Farmer said...

Since 1989 (the start of the current emperor's reign), average income in Japan has declined year by year, and the government announced yesterday that it's now at its lowest point in the last 17 years.

Anonymous said...

Here in the US, it has been falling (in real, inflation-adjusted dollars) since 1973, down more than 12% for the median male worker in his 30's.
Over the same period, productivity rose 72%.
Webster's has a term for this.....'robbery'.

Chris XVX said...

Hey Swift, I'd do a little research on Amy Goodman, Jeremy Scahill and Democracy Now! They get it wrong alot of the time...