What a World Without Oil Looks Like
bloomberg.com
bloomberg.com
What's being discussed here is not what a world without oil would look like, but "what would the economy look like if we pretend the energy sector doesn't exist, but we're still somehow getting oil from magical fairies".
If you were looking at the performance of the US economy lately and going "huh, it keeps going up and down, but some of that is 'cause of oil prices changing, what would it look like if they hadn't?" then this is the article for you.
If you were thinking about literally any other question (and especially the question of what the world might look like without oil) then this will be a puzzling waste of time; the payoff is just a graph of US industrial production over time excluding the energy sector.
(Spoiler: Recent fall in oil prices has not been good for the energy sector, but has been good for the rest of the economy, so if you pretend that the energy sector doesn't exist, then the "economy" looks better. Also, if you pretend that the unemployed don't exist, the unemployment rate is amazing. On the other hand, if you pretend Canada doesn't exist, it raises some very troubling concerns about maple syrup supplies. In other words, this is pretty fucking pointless.)
Creating value in energy production is good, up to a point, and that point depends on whether you are an exporter or not. But if energy becomes a too-large part of the economy it does so at the expense of the rest of the economy.
The same can be said about health care: Health is good. So spending on health care is good. Until it exceeds what other nations pay to get the same health. Similarly, a healthy financial sector is good, unless it drifts into excessive financialization.
Illustrating how one economic sector becomes a vampire is useful because it illustrates how raw GDP can hide vampires that suck the blood out of quality of life.
Health care will eat everything now anyway. Medicaid is going to be the real estate purchaser of last resort - if you live long enough to outrun Medicare, the State (not the Federal gov't ) will get your house. No amount of estate planning will prevent it.
High energy prices could be quite useful right now - we'd seen actual drops in measures proportional to carbon being added to the atmosphere. I'd rather see that done in the market than by government fiat. It is just that government fiat takes a couple-three generations to get calibrated.
And I have a really funny feeling about your "at the expense of the rest of the economy". I didn't buy that in the 1980s and I don't buy it now. We're not exactly seeing an explosion on consumer spending.
What's too much? That's why people study statistics, so they can spot the outliers. 5x other similarly industrial nations is probably too much health care spending. Draw the line at some mathematically defensible place.
It's not that clear that the fall in energy prices has been all that good for the rest of the economy.
What's ... tension inducing is that in 2008, the event that triggered Fed tightening was an uptick in oil prices. Some will disagree, but this was the thing more than anything else that helped us have the recession by many stories - the financial crisis itself didn't last that long.
And to those who would pretend the energy sector doesn't exist, you could get your wish.
Not that I'm complaining... Except fuel taxes are now way too low.
http://worldwithoutoil.org/default.aspx?showall=true#end
Over the course of 32 weeks, 1,500 participants created blog posts, vidoes, images, and audio recordings as a simulation of the crisis as it progressed. This page highlights some of the best submissions for each week. Unfortunately you'll need to make use of the Wayback Machine for some of the links.
Here is the main takeaway:
YoY EPS Growth
S&P 500 With Energy: -2%
S&P 500 W/out Energy : 5%
These short Bloomberg pieces have truly perfected the art of explaining nothing but looking like its explaining something, then slapping a clickbait title on top of everything. They've stripped out 3 quotes from an analyst report that they don't bother linking to, and tenuously tied together brief blurbs on the industrial production index, EPS growth, and core inflation without explaining any of them in a satisfactory manner.
Welcome to finance...
Financial feels so full of decoy material, designed to keep minds weak and preoccupied so the elites can do their thing without interference...
Advice can be tricky but IMO the best information are plain, boring whiteboard lectures explaining investment fundamentals. (This guy, who I've enjoyed a few of his tutorials, as one example: https://www.youtube.com/user/MoneyWeekVideos) I avoid fruity, feel-good financial gurus because I see a lot of the same mannerisms and personality types as I encountered amongst the con artists in the 'financial seminar' and MLM scenes.
Also, market commentaries from conservative brokerages are good for figuring out the macro picture
"Resources exist to be consumed. And consumed they will be, if not by this generation then by some future. By what right does this forgotten future seek to deny us our birthright? None I say! Let us take what is ours, chew and eat our fill."
- CEO Nwabudike Morgan "The Ethics of Greed"
Americans who decry environmentalism and the EPA don't seem to be clamoring to say "there's nothing wrong with Beijing's air"
Then you can chide people for being overly moralistic.
> "Resources exist to be consumed. And consumed they will be, if not by this generation then by some future."
Researchers at University College London published a study in Nature[0] which determined that a significant portion of the remaining fossil fuel resources must _not_ be used if we are to avoid crossing one of the major thresholds of climate change. This isn't about morality, it's about the survival and prosperity of future generations.
[0]: http://www.theguardian.com/environment/2015/jan/07/much-worl...
Sounds more like politics than science, and neither the Guardian article nor the abstract explain the reasoning why some carbon is ok and other carbon must be kept below ground. Are we meant to merely accept it on authority?
And why 2C? A number that round almost certainly has no scientific significance, and was probably chosen for psychological and political reasons. It's a completely arbitrary target, but we are meant to feel fear that we won't meet it.
Articles like this give people who aren't inclined to believe in climate change more reason to suspect it's a scam (something I've often heard them claim).
The messes on the production side are arguably more tractable than CO2.
Imagine a telling a group of obese people "Those people who have not gone on a diet in the last 4 weeks are not overweight because they don't want to be slim".
"Anyone who has not had an address in 4 weeks is not homeless because they do not desire a home".
You can probably imagine hundreds more scenarios. When faced with repeated failure, many people fail to act in their own interests. In fact, I don't think the unemployment number is necessarily dumb -- it measures the number of unemployed people who have not given up hope of working. But we really need a measure of all the people who have given up hope, but still want to work.
What's unfortunate is the attitude that your question implies (and I'm not actually suggesting that you have this attitude, though it is very common): it is easy to think that people who have given up want the failure that they now experience. Normally this is not the case.
I once saw a homeless person trying to explain to someone their predicament. I don't remember their exact words, but it was something like this: "It's -5 degrees C today. I live in a cardboard box on the side walk. Do you really think that I wouldn't rather sleep in a warm bed? But I've got a lot of problems and this is the best that I can do right now." Followed by considerable profanity (probably their case would have been easier to follow for the listener had that been omitted).
I don't think it's connected to insurance benefits. I think the statistic is dumb, because it should count people who are available to work but aren't.
On the other hand, if you aren't looking, maybe you really aren't available.
If your collecting benefits your filing a report stating that you are/looking & available, if your not collecting EI benefits, your not filing report, your likely not counted as "officially unemployed".
You may fall into the broader U6 unemployment numbers that u/roofus mentions below.
Of course, I doubt both show underemployment.
Came across an interesting article[0] about how they are measuring these along with some historical data. It touches on underemployment as well, indicating that the underemployed are included in the U6 numbers.
The articles most recent(2015-06) monthly U3 rate of 5.3% is about half of the U6 rate of 10.5% for the same period.
[0] http://econbrowser.com/archives/2015/07/measuring-unemployme...
Where do you think all this stuff comes from?
Oil got expensive. People and industry got more efficient at using oil. Oil is cheap. who cares? we're much more efficient at using oil. The painful part is switching to 30mpg cars.
To put it another way, pre-boom you budget $100/month. gas gets expensive, and turns out to be $200/month. People carpool, or turn down the thermostat, or get a more efficient car, to get back to the $100/month budget. Gas prices, fall so under the new system it's only $50/month.[2]
That $50 is nice, but not as nice as that $100 was painful.
[1] http://alternativeenergy.procon.org/view.resource.php?resour... [2] https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=E...
You know there are other non-petroleum oils that can provide some of these needs, right?
As for lubricant uses, looks like that can work too: http://www.sciencedirect.com/science/article/pii/S0020740311...