Comments on: Oil and the Structural Recession http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/ Tue, 21 May 2013 17:17:32 +0000 hourly 1 http://wordpress.com/ By: BullseyeMicrocaps.com » Has America Lost Its Drive? http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23980 Sun, 19 Feb 2012 13:14:08 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23980 [...] Karl Smith posted on Oil and the Structural Recession. This seems to be one of Karl’s thinking-out-loud posts, with more questions than answers, [...]

]]> By: Stuff I Read Today « J.J.Lo http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23926 Sat, 18 Feb 2012 04:23:14 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23926 [...] Smith on Oil and the Economy: Sort of goes over my head, but the conclusion is a new one (to me); He’s saying that [...]

]]> By: Eric http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23883 Fri, 17 Feb 2012 02:37:57 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23883 It may not look structural, but it may be structural nonetheless. Also, what happened to the median wage in the US since the 70s? Pretty much nothing. There *was* a structural shift in the the US economy in the 70s, even if the elites were mostly insulated from it and didn’t really notice. Anyway, oil production is very likely peaking, and if that’s not structural, it’s hard to imagine what would be…

]]> By: JazzBumpa http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23879 Thu, 16 Feb 2012 23:16:43 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23879 IVV -

I don’t think there is any disagreement on that point.

Cheers!
JzB

]]> By: IVV http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23856 Thu, 16 Feb 2012 17:54:32 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23856 Furthermore, I would easily say that higher gas prices are contractionary for discretionary personal driving.

]]> By: Stones Cry Out - If they keep silent… » Things Heard: e208v4 http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23855 Thu, 16 Feb 2012 16:56:57 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23855 [...] Oil and recession. [...]

]]> By: Thursday Highlights | Pseudo-Polymath http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23854 Thu, 16 Feb 2012 16:56:30 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23854 [...] Oil and recession. [...]

]]> By: anoncubed http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23850 Thu, 16 Feb 2012 16:32:20 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23850 What’s the difference between the plateau we’re at now and the plateau in the late 70s and early 80s?

Peak oil + condensate production.

]]> By: rjs http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23848 Thu, 16 Feb 2012 16:14:20 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23848 see the chart:

http://peakoil.com/consumption/why-is-gasoline-consumption-tanking/

]]> By: Lord http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23844 Thu, 16 Feb 2012 15:25:42 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23844 Inelasticity means 1 is large and immediate. While 2 will lead to more investment and more than generally justified because efficiency improvements are not that effective, durability limits the speed at which this occurs. It has really been notable how limited and slow 3 has been at this time. It was large in the late 70s which led to the rapid fall in oil prices in 83 while the industry feared a repeat this time so was unwilling to make any investment this time to the point of reducing exploration and development during the recession. If the Fed defines inflation as an increase in oil prices then it isn’t going to be undertaken which means real oil prices will rise over the long term rather than quickly and collapse.

]]> By: No Country For Constitutional Men http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23841 Thu, 16 Feb 2012 14:50:34 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23841 They are loading up the dealers with more vehicles than the dealers know what to do with them, and subprime credit for auto sales is what is moving the market at this point. Look at your local paper for examples of stupid from people that didn’t learn from the last debacle. The Retail Gasoline Deliveries figure doesn’t lie because it can’t be manipulated, and it says we are trouble on growth just as your chart indicates. No way do we get close to 20, and 14 is a real jump of faith on a continuing basis. At some point, there are no greater fools.

Three different shipping indexes also paint a picture of global collapse in demand for raw materials and consumer goods.

]]> By: JazzBumpa http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23840 Thu, 16 Feb 2012 14:37:20 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23840 Karl -

Check this out. Commercial trucking index has recovered, while total driving slump continues. Discretionary personal driving must be off even more than your graph indicates.

http://www.calculatedriskblog.com/2012/01/ata-trucking-index-increased-sharply-in.html

JzB

]]> By: JazzBumpa http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23838 Thu, 16 Feb 2012 14:16:26 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23838 Karl -

Good post.

The thing is a roar back will also mean very rapid increases in gasoline consumption which in turn means much higher prices.

You’re assuming demand pull on gasoline price at the pump. Is there any evidence for this? I see all petroleum prices as highly manipulated on the supply side, with demand as a follower. Look at the slope of the curve in your graph. There is a continuous slow decrease in slope going back to about 2000 – a few years before prices took off.

FreeDem -

Everything was different in the 70′s. Look at the curve coming into ’79. If anything, the slope was increasing, and there was a bump up just before the plateau. There was also high inflation, which Volker killed as the plateau was happening.

Here, the price bubble was dragging down consumption even before the crash, and inflation has been tame for decades. I don’t think there are any points of similarity.

Cheers!
JzB

]]> By: reason http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23837 Thu, 16 Feb 2012 14:05:27 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23837 Oil to gas substitution could be a big driver in the intermediate future.

]]> By: Curt Doolittle http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23836 Thu, 16 Feb 2012 13:36:23 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23836 This post is another example of why you’re the best at what you do, Karl.

Explicative. Non-argumentative. Factual. Unafraid to hypothesize. Confidence without bravado. And in the interest of all regardless of affiliation.

Economics for the common good, not for ideological advancement.

You’re the best.

]]> By: FreeDem http://modeledbehavior.com/2012/02/16/oil-and-the-structural-recession/#comment-23835 Thu, 16 Feb 2012 13:33:01 +0000 https://modeledbehavior.wordpress.com/?p=11336#comment-23835 What’s the difference between the plateau we’re at now and the plateau in the late 70s and early 80s? If that was temporary, why can’t this be temporary? Why does now “look” structural, given the context of previous plateaus.

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