Oil produces expensive Caesar
salad By The Mogambo Guru
For days and days I had been watching oil
go down and down in dollar price - down to $82, to
$81, to $80, to less than $79 a barrel - while
watching the dollar go down and down in terms of
purchasing power, and it is such a cognitive
dissonance that my Puny Little Mogambo Brain (PLMB
) refuses to accept the input. After a little
consulting (Me: "Is it me, or is something
seriously amiss?" She: "Your breath stinks."), I
easily diagnose that the problem is that the
systems in my Earth body are somehow
misaligned, causing me to
perceive incorrect data.
Naturally, I
wisely and sagely decide to "adjust" my Earth body
by drinking cheap tequila with Margarita-mix
chasers, straight from the bottle, like the macho,
he-man, swaggering hunka-hunka-burnin'-love kind
of guy that I really am.
Then, last
Thursday, I was pretty well "adjusted" and could
barely hold my head up off the bar, when … Wham!
The oil future shot up over $2.79 to $83.09!
Hahaha! I was right! Absolutely correct, from an
investment perspective, but unfortunately I was
too poor to do anything about it then (eg, like
buying more oil stocks, oil ETFs, oil futures, and
oil options on the way down), although not too
smashed to do anything about it now (loudly
whining, complaining and raving about a conspiracy
against me).
The Desidooru Saloon at The Daily Reckoning notes
that "Whatever the ministers of OPEC decide at
their meeting in Vienna, this much is for certain:
OPEC production has been rising for weeks now,
even as prices approach a record. Yes, surprise
surprise, OPEC members are cheating on their
production quotas - just as they have for decades.
And more to the point, does it make any
difference? If oil prices have been rising the
whole time OPEC output has been rising, is demand
outstripping supply even as supply grows? That's
the real story that's getting lost amid the
speculation of what's going on behind closed doors
in Vienna."
And in MoneyWeek.com, I was
captivated by their headline, "Why the end of
cheap oil could spell death to suburbia", which is
oddly reminiscent of Jim Kunstler's The Long
Emergency. As the editor-in-chief around here,
I find that I disagree with the use of the word
"could" to describe the probabilities of the
phrase "death to suburbia" when oil (and thus
gasoline) get to be horrendously expensive, the
economy is in the toilet and nobody makes enough
money to buy the energy necessary to ride around
in their cars when they can't even afford to keep
their damned little houses warm in the winter!
So I am looking for my red pencil to make
the changes to the sentence so that it will read
"Why the end of cheap oil will definitely spell
misery and suffering and the death of suburbia,
although everywhere will be aflame with inflation
in prices like you will not freaking believe, with
people rioting everywhere, and the people in
suburbia will say, 'At least we're out here in
suburbia! The rioting city dwellers don't have the
money to buy gasoline, either, and so they can't
get out here to harass us! And if they ride the
bus out here, we'll send them over to The
Mogambo's house and he'll shoot the stinking
bastards for us!' Hahaha!"
But I can't
find the damned red pencil, and then I think how
long it will take to make the corrections even if
I found it, and so I decide "To hell with it!" and
decide to just abuse MoneyWeek.com by calling them
"worthless, gutless cowards" for using the word
"could" instead of something more appropriate.
Like, for instance, "certainly will", probably
because it inexorably leads to "We're all freaking
doomed!"
I think my incessant carping got
to them, as they suddenly acquiesced enough to
say, "there are rising concerns about petrol and
heating costs. At most, 10% of suburban households
face incipient crisis in the short-term." Ten
percent! Yow! This is the literal definition of
the word "decimation", for crying out loud!
The article goes on to reveal that it is
not just suburbia, either, but asks you to
remember that oil is a big part of everything
these days, and to, "Just ponder this … the
average Caesar salad travels 1,500 miles to the
supermarket shelf."
And I have to make a
trip of the last few miles to buy it. Where's the
justice in that crap?
Richard
Daughty is general partner and COO for Smith
Consultant Group, serving the financial and
medical communities, and the editor of The Mogambo
Guru economic newsletter - an avocational exercise
to heap disrespect on those who desperately
deserve it.
Republished with permission
from The Daily Reckoning.
Copyright 2007, The Daily
Reckoning.
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