Daily Digest

Daily Digest 3/2 - Grantham Goes Marxist, A Dynamic EROEI Function, Why Is N. Korea Always Short On Food?

Friday, March 2, 2012, 11:41 AM
  • The TSA Is Coming To A Highway Near You
  • No Insurance Pay-Out On Greek Debt
  • Inflationary Environment: Why Inflation Is Just Creating A Tax On The U.S. Economy
  • Grantham Goes Marxist!
  • Auto Sales Pick Up Pace Despite Rising Gas Prices
  • Obama Seeks to End Subsidies for Oil and Gas Companies
  • A Dynamic Function For EROEI
  • Why Is North Korea Always Short On Food?

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Economy

The TSA Is Coming To A Highway Near You (June C.)

Believe it or not, only 7 years ago, TSOs went by a more deserving title, “airport security screeners.” At the time, their title and on the job appearance consisted of a white shirt and black pants. This was fitting because airport security screening is exactly what’s required of the position. However, this is no longer the case.

No Insurance Pay-Out On Greek Debt (ewilkerson)

Billions of dollars in credit default insurance will not be paid out to investors in Greek debt, an industry body has ruled, turning down two requests for a pay-out to be triggered over a debt swap.

The International Swaps and Derivatives Association decided there had not been a credit event yet in Greece ahead of next week’s €206bn debt swap but left the door open for a different decision in the future.

Inflationary Environment: Why Inflation Is Just Creating A Tax On The U.S. Economy (David B.)

But let’s use the doctored government numbers for a moment. Using the doctored numbers, what inflation has done to all of us is still absolutely horrific. Just check out the chart below. This is what the Federal Reserve was designed to do. It was designed to constantly expand the money supply and create inflation that never ends…

Grantham Goes Marxist! (Ilene)

Grantham points out that a company is now free to spend money to influence political outcomes and need tell no one, least of all its own shareholders, the technical owners. So, rich industries can exert so much political influence that they now have a dangerous degree of influence over Congress. And the issues they most influence are precisely the ones that matter most, the ones that are most important to society’s long-term wellbeing, indeed its very existence.

Auto Sales Pick Up Pace Despite Rising Gas Prices (jdargis)

Automakers sold 12.8 million cars and trucks last year, and the last time sales surpassed 14 million was 2007. That same year, General Motors, the Ford Motor Company and Chrysler lost more than $44 billion. The sales gains reported Thursday were achieved without the big discounts that helped many sales booms in the past. And even though many shoppers were drawn to small and less gas-thirsty models, buyers paid an average of $1,943 more for a car than last year, the biggest year-over-year increase in recent memory, according to TrueCar.com.

Energy

Obama Seeks to End Subsidies for Oil and Gas Companies (jdargis)

The president criticized Republicans who have called for the country to increase its own oil production, declaring that “anyone who tells you we can drill our way out of this problem doesn’t know what they’re talking about.” With the United States consuming more than 20 percent of the world’s oil while having only 2 percent of the world’s oil reserves, Mr. Obama said “we can’t rely on fossil fuels from the last century.”

A Dynamic Function For EROEI (ewilkerson)

The post below is a reproduction of a paper published in the open access journal Sustainability by Michael Dale, Susan Krumdieck, and Pat Bodger (Vol. 3). The article is a first in creating a dynamic function where Energy Return on Energy Investment changes of an energy resource are estimated over time. In this manner it becomes possible to get an estimate of how much net energy a given fossil oil, gas, coal or renewable energy source yields during its lifetime. The created EROI function is based on theoretical considerations of energy technology development and resource depletion.

Environment

Why Is North Korea Always Short On Food? (jdargis)

Poor growing conditions, fertilizer shortages, and general mismanagement. On the most basic level, the terrain and climate in North Korea aren’t great for farming. The country is mountainous, and the growing seasons are short. (North Korea is at approximately the same latitude as New England, but prevailing air currents make it even colder.) In defiance of nature, North Korea’s isolationist leaders decided in the 1950s that domestic farmers had to fulfill all the country’s food needs. They instituted intensive agricultural practices to maximize yield from their limited arable land, relying on heavy irrigation and copious pesticides, herbicides, and fertilizers. They scraped by for decades with only occasional famines, but the system totally collapsed in the 1980s, when the Soviet Union cut the supply of subsidized fossil fuels, from which many of the DPRK’s agricultural chemicals are derived.

Article suggestions for the Daily Digest can be sent to dd@PeakProsperity.com. All suggestions are filtered by the Daily Digest team and preference is given to those that are in alignment with the message of the Crash Course and the "3 Es."

11 Comments

saxplayer00o1's picture
saxplayer00o1
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Doug's picture
Doug
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Grantham article

Quote:
A sustainable economic system, for instance, can’t be based on ever-increasing debt, corporations can’t be allowed to run governments and loot treasuries, and “growth at any cost” is a recipe for planetary suicide.

This isn't political ideology, it's common sense.

Doug

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saxplayer00o1
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Mark Cochrane's picture
Mark Cochrane
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EROEI and Energy Return Intensity

A particularly interesting paper that looks not only at EROEI but also just how much can be expected to be squeezed out of it in terms of economic output can be found here (King (2010) link). Chris and others may want to incorporate this into their interpretation of EROEI as it is correlated but allows for annual computation. For me the take home message is:

The EIR calculations of this letter also shed light into the nature of energy efficiency in the US. The economic energy intensity is often used as one measure of economy-wide energy efficiency. By calculating EIR in a manner that is normalized by economic energy intensity, we are able to track how well energy is produced relative to technological change. For example, in 1972 EIRp, gasoline was 5.9 and in 2008 EIRp, gasoline was 5.5. But during this time period the US average car fuel efficiency changed from 0.073 (13.7 mpg) to 0.044 (22.6 mpg) gallons of gasoline per mile traveled—an increase in efficiency of 39% (Davis et al 2010). Thus, even though there was significant improvement in car fuel efficiency, the net energy contribution of gasoline to economy was essentially the same in 2008 as three and a half decades earlier. Technology advancement and economic restructuring have only allowed the US economy to tread water with respect to net energy for petroleum (Charles 2009). Efficiency investment thus far has not significantly eliminated the need for fuels with high net energy.

Mark

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saxplayer00o1
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National Debt passes $15.5 trillion

Treasury Direct link

The Daily History of the Debt Results

Historical returns from 02/20/2012 through 03/01/2012

The data for the total public debt outstanding is published each business day. If there is no debt value for the date(s) you requested, the value for the preceding business day will be displayed.

( Debt Held by the Public vs. Intragovernmental Holdings )

 

Date Debt Held by the Public Intragovernmental Holdings Total Public Debt Outstanding
02/17/2012 10,655,355,371,776.74 4,761,238,608,236.30 15,416,593,980,013.04
02/21/2012 10,656,186,702,155.54 4,763,613,520,169.61 15,419,800,222,325.15
02/22/2012 10,656,161,387,513.97 4,760,162,256,532.79 15,416,323,644,046.76
02/23/2012 10,675,481,199,498.82 4,760,213,356,534.47 15,435,694,556,033.29
02/24/2012 10,675,327,157,594.47 4,762,660,691,866.44 15,437,987,849,460.91
02/27/2012 10,674,959,196,269.01 4,763,558,866,421.36 15,438,518,062,690.37
02/28/2012 10,675,494,440,597.72 4,766,626,543,066.16 15,442,120,983,663.88
02/29/2012 10,722,996,298,868.22 4,765,894,997,379.80 15,488,891,296,248.02
03/01/2012 10,755,610,818,537.19 4,745,403,897,606.53 15,501,014,716,143.72

California Increases Yields to Close Sale of $2 Billion in Refunding Bonds

IMF Set to Curb Funds for Greece

Greeks try to keep the peace with their dwindling German tourists

Obama says he's not bluffing on Iran military option

Netanyahu warns against diplomatic path with Iran
 

Arthur Robey's picture
Arthur Robey
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Thanks Mark

Thanks Mark.

What I understand is that the EROEI is at the beginning of the oil pipeline. At the other end of the pipeline is the economy.

In the pipeline are increased fuel efficiency which is wasted by inefficient utilisation. This is to be expected of an economy that uses vehicles with a rediculous gross/tarre mass ratio. (Using the Hummer to go buy a bottle of milk.)

On the other hand the internet reduces vehicle usage.

Here is what wiki reveals about the Energy Intensity (How much economic activity is generated per joule.)

This graph has a time axis.

GDP and energy consumption in Japan, 1958–2000 The data shows the correlation between GDP and energy use; however, it also shows that this link can be broken. After the oil shocks of 1973 and 1979 the energy use stagnated while Japan's GDP continued to grow, after 1985, under the influence of the then much cheaper oil, energy use resumed its historical relation to GDP.[3]

Gapminder and WolframAlpha were silent on the issue, hence the wiki reference.

To be honest, I dont trust these graphs and statistics because energy (a real substance) is measured against Fiat money. (Which is pulled out of the air)

saxplayer00o1's picture
saxplayer00o1
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Moody's cuts Greece to lowest rating

Moody's cuts Greece to lowest rating

Arthur Robey's picture
Arthur Robey
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Democracy is Too Inconveniant

Prof Steve Keen and Lauren Lister discuss bubbles and the inconvenience of democracy to the ruling Bankers.

Via Prof. Keens weblog, Debtwatch.

Damnthematrix's picture
Damnthematrix
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Posts: 3998
Substance

Arthur Robey wrote:

To be honest, I dont trust these graphs and statistics because energy (a real substance) is measured against Fiat money. (Which is pulled out of the air)

Interesting charts there Arthur.....  but let's get one thing straight:  Energy is mightilly useful, but ut has no substance, here one minute, gone the next. It's actually unique in that regard, it is the only major resource we use that cannot be recycled or re used, which is what makes its waste so unsustainable.

Mike

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