I've said this before, but

[solarbird]

Okay, so, we're looking at what is likely to be a very bad time to be carbound in 2008. (Move. Seriously. Have a car, sure, but don't be dependent upon it. BTW, diesel? Not a particularly bad idea.) The US Department of Energy's Guy Caruso is projecting barrel shortages in the first quarter of 2008 without an OPEC production hike, which is bad by itself, but former Saudi Aramco exploration and production VP Sadad Al-Husseini says that while the Saudis will be able to boost output over the next few years, it won't be enough to boost world production significantly past current levels due to declines in production at other large fields. So while from a short-term technical standpoint, oil is currently overpriced, in the medium-term and long-term view, it's still quite cheap even at $95.

I expect true barrel shortages will not actually be allowed to happen that soon; both the Saudis and the Americans have strategic reserves and will release oil from them if it's thought this patch could be covered over until the Saudis can do something, if necessary, for the Saudis, under the guise of a quota hike. But this is still an illustration of how tight things are now. A recession would delay the obviousness of the deeper problem, but not by a whole hell of a lot, so if you're in the Sound Transit / Proposition 1 voting area, I restate my recommendation that you vote for Proposition 1. Inadequate though it is, we do not have time to fuck around.

Also, Can$1 now buys US$1.07. Two and a half years ago, it bought US81¢. Canadian oil and Canadian gas are now 32% more expensive for Americans on exchange deltas alone in the last couple of years; plus the tar sands in Alberta chew natural gas in processing. With the US dollar continuing to create new 35-year lows almost every day - seriously, check the daily charts, it's ugly - the energy buying power of Americans is taking it in the teeth. The US is not going to be first customer for very much longer at this rate; in fact, if the Persian Gulf states decide to drop their dollar pegs - something that isn't going to happen in the next few months, mind you, but could - the US won't even be in the top 10.

So. Fun things to think about over the weekend. Enjoy!

Comments

two points as noted in passing

[angharads-house.livejournal.com]

1. Retail purchase rate at local credit union (in Canada), 93.7 cents to buy 1 USD. Credit Union is just about out of US cash; manager reports that many members are planning day-trips across the line to do their seasonal gift-shopping. Response by local merchants is not too cheerful: there is pressure to sell pre-priced items at their (markedly lower) American retail price rather than Canadian retail price. Cover price differential on books, for example, runs anywhere up to 60%.

2. As reported by phone from Greensboro: price of gasoline up 21 cents/gallon on Friday, at "market leading stations" (M.'s words for it); he was also staggered to observe that local shopping mall parking-lot was full of cars, as if a general frenzy to buy was going on.

Raises a good question: if the country is being run on debt, what happens when the debtors default on their loans?

Second question here: does the big disconnect happen when people stop buying trinkets on credit?

Have no answers here; am worried about our children's ongoing ability to get by, if we are leaving this sort of economic train wreck for them to inherit?

Re: two points as noted in passing

[solarbird]

cow found this:



i lulzed

[westrider.livejournal.com]

Makes me glad I can walk to most places I need to go. And pretty much all the rest of them are doable by bus.

Re: two points as noted in passing

[solarbird]

Yeah, that's the kind of situation we're in, by design, tho' the walking is further than I'd really most like. At least the bus system is good, and the biking situation is pretty excellent once you get used to that wicked tall hill on the way back up from Bothell Way.

Re: two points as noted in passing

[westrider.livejournal.com]

My idea of "within walking distance" is about 5 miles at this point, but with my bad knee, it's really too hilly around here for me to bike, so I guess it pretty much evens out.

Re: two points as noted in passing

[solarbird]

Oh jeez okay. Damn. I put "reasonable" at about 1 mile. The Sightline Institute puts it at about 1/4 mile, which is a number they arrive from looking at Americans nationally and I think wildly overshortens the reality for our region.

Re: two points as noted in passing

[cafiorello.livejournal.com]

When I say something is within walking distance, I mean about a mile away. Other people scrunch up their faces and act really confused. My family refers to things being "within Cathy's walking distance."

Almost everything is within walking distance here, or is on the commuter train line. People tell me now how "lucky" we are to live so close to the train station. Um, how do they think we shopped for a house?

Cathy

walking-scale communities

[angharads-house.livejournal.com]

At a wild guess, our village is about half a mile north-south and three-quarters of a mile east-west, fairly densely infilled with few vacant lots but a fair number of parks. We have hills, some of them rather steep.

Most everyone here walks to and from their daily chores; it just makes sense, and when it rains or snows, one dresses for it. Part of why we walk rather than driving is that there are no through-highways here: there is effectively nothing but wilderness to the west and south; to the north is a maze of dirt and gravel roads into the woods; to the east are the two paved roads leading out of town (only one of which actually leads to the highway). With no through roads, we are effectively living in a giant cul-de-sac, and more than anything else, that cuts down on vehicle traffic.

My guess, for what it's worth, is that most of us would consider anything up to a mile as being a reasonable walk, one-way, to or from where we needed to be. Ignoring for the moment that I am mostly house-bound for the next month, I have little need to drive the car anywhere here; and if there was a longer-range errand within the valley, say down to the next town, there is always the bike. We have bike-lanes on the highways, thank goodness.

Until a couple of weeks ago, when I was here at home, I'd walk six miles a day, divided equally between early morning and last thing at night. Walking in some ways is a more relaxing pastime than biking.

Price of gasoline this evening: 101.9 cents per litre (always the darned .9 at the end....). Have no easy idea what that is in dollars/gallon by USA terms -- say four dollars, roughly? Doesn't seem to dampen anyone's ardour for long road trips... ^_^

[llachglin.livejournal.com]

Just back from our Mexico trip, I have to say I was astonished at the relatively low value of the US dollar. We went to a Wal-Mart outside of Puerto Vallarta (it's where the local buses transfer, and we needed to buy cheap clothes for my niece). The prices after currency conversion (a bit over 10:1 for the US dollar in the range of $10.30-$10.60) were at best on par with equivalent products in the US at say, Target. (I've never shopped at a US Wal-Mart so I can't make a direct comparison.) Granted, PV is an overheated tourist economy and even the Wal-Mart frequented by locals is not an exception, but in the relatively recent past (ten years ago) prices across the board for goods there were often as little as half what they are in the US, and sometimes more.

The only thing I saw that was a good deal were the fresh tortillas--a few pesos for a day's supply for a large family (30 cents to you and me). So if you're a poor Mexican family in the area, you can subsist on tortillas and beans and just avoid buying any consumer goods. But if you have to buy anything or aspire to the Mexican equivalent of middle class, you need to spend at least as much as people pay in the US for the same stuff. For services and goods catering to tourists, the prices are higher than the equivalent in the US. We paid $16 for a small bottle of sunscreen.

There were a noticeable amount of Canadian tourists around, too, exercising their newfound currency power. Lots of people from Alberta, and every sign with peso to US dollars listed had the Canadian dollar listed just as prominently.

I don't know enough about the peso to know if this is just a crash of the dollar or a simultaneous improvement in the value of the Mexican currency. Mexico is an oil exporter, though its output is dropping dramatically so that's probably only a small piece of the puzzle. In any case, the day has come where goods cost as much in Mexico as in the US. The big difference is that in the US average income is higher--though with globalization in full force and a US economy that increasingly devalues work in favor of the large investor class chasing a series of bad investments, who knows how long that will last?

[llachglin.livejournal.com]

by "large investor class" I meant "the class of investors who toss around large amounts of capital" rather than "a large class of investors." I'm tired and just spent a week in a country attempting to speak in a foreign language.

[solarbird]

It's mostly the dollar going down. Mexican oil production is plummeting and it's not going to be an oil currency for all that much longer.

I had a link to an article on one of the financial sites - Bloomberg, maybe? - talking about tourists finding the dollar no longer very interesting to those abroad, with people wanting payment in the local currency instead.