Plateau Oil meets 125m Chinese cars

[Javaman]

http://www.telegraph.co.uk/finance/commodities/9122311/Plateau-Oil-meets-125m-Chinese-cars.html

That proved to be the pain barrier in the 1970s and again in 2008, and we are just shy of that level right now. “Oil is already capturing a higher level of European GDP than in 2008,” said Francisco Blanch from Bank of America.

The rule of thumb is that a 10pc rise in crude cuts US growth by 0.2pc four quarters later, but the science is flabbily soft and nobody knows where the inflexion point lies. The effect is famously “non-linear”. Nothing much seems to happen until confidence suddenly snaps.

What is deeply troubling is that Brent crude should have reached fresh records in sterling (£79) and euros (€94) - with a knock-on effect on US petrol prices, mostly tracking Brent - even though the International Monetary Fund has sharply downgraded its world growth forecast to 3.25pc this year from 4pc in September, and even though International Energy Agency (IEA) has cut its oil use forecast for this year by 750,000 barrels per day (bpd).

Oil is not supposed to ratchet defiantly upwards in a downturn, which is what we have with the Euro zone facing a year of contraction in 2012, and much of the Latin bloc sliding into full depression. Japan‘s economy shrank in the fourth quarter.

more at link...

[lib2DaBone]

1. When the Dow crashes to 5000... we will be swimming in oil...

Who knows if and when it will happen.. but the conditions are right..

We are NEVER going back to a "consumer growth" economy. Planet Earth will not support it.

If only we had a President with a vision for the future and leadership.... but no use going down that road.

All I can say is that it will pay to become a good customer at Harbor Freight and Grainger Tools. Buy books on how to fix things. Get to know your neighbors who raise chickens and have eggs to sell. Get to know where your local Farmers Market is located and what the hours of operation are.

Learn how to bake bread from scratch and how to do home canning. i.e. We will not have corn available all year at the market. You will have to buy it when it is in season and home can it for use at other times.

China will kick our butt very soon. All we can do is prepare.

[HoosierCowboy]

2. Oh come on don't be depressed

A little song to reconcile you with the inevitable....

&context=C3b0c8e0ADOEgsToPDskI4hZm4-XleuxZ4gb2iUI-e