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Comment on: TheWayWeAre

The BIGNESS of Big Oil

94 Comments
Sunday, December, 09, 2007 2:58 AM Peppermint2 writes:

PPhil

I'm first!!

Whew. What an article. Very complicated for me I might say.

Of course I have never believed this business about government/business conspiracy about the oil.

One thing I don't understand is why we don't drill for our own oil offshore. I know the greenies oppose it all the time, but is there no way around that? Plus would those oil reserves that are off shore do us any good?

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Sunday, December, 09, 2007 7:46 AM Nee writes:

Absolutely!

We cannot afford to wait and yep the "crisis" mode will constantly ensue unless we move forward.
Finding more oil will only extend the outlook, but I don't hink it will ever outpace the growing demands. I mean, who would have thought that China's needs would ever have grown like they are?
I wonder sometimes if a centralized transportation system existed could this potential oil drain be slowed down? When in Europe, I never have to drive a car, because of the trasnport. I know, it is smaller than the US. I am still convinced there are some solutions to be had in that arena.
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Sunday, December, 09, 2007 10:18 AM Pasadena Phil writes:

Pep

First! Woohoo! This IS a very complicated subject and it is was very frustrating writing it. There are so many tangents and very important side issues and tangents that I am sure will be brought up in the comments that I had to limit my discussion to the barest of facts. The main point is that because we most of us simply can't grasp the scale of how much oil we currently use and how fast that demand is growing, finding more oil is no longer the issue. The earth may be a big place but it has its limits and we are testing them.
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Sunday, December, 09, 2007 10:26 AM Pasadena Phil writes:

Nee

From my office window, I can look down on a perpetual traffic jam below. I keep asking those who are against public transportation if they had to build a method of transportion and all the money people currently insist on spending on cars to spend so much time crawling to work, is THAT is the system they would design? I lived in Boston for 7 years without a car and it was far from being a problem. Renting a car is cheap and the trolley/subway system works. Light rail is expanding fast here in LA and real estate invetments are already building it into the big plan. There are lots of good things going on but at the personal level, people are resisting heels dug in. People don't change until it hits them hard in the pocketbook. That's just the way people are.
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Sunday, December, 09, 2007 10:33 AM Pasadena Phil writes:

Doc

Your point is one of the issues I couldn't elaborate on. Exploiting the "goop" and shale oil sources is part of the scarcity economics scenario. It is predicated on high and climbing prices which is itself part of the crisis. There is nothing like light sweet CHEAP crude. The global economy is already too dependent on mainly one source of cheap energy and we are way behind on working on the many substitutes that will be required to keep thing going smoothly. We also have the largest coal reserves whose proponents represent the most strident obstacles to the development of nuclear, wind, solar and other alternatives requiring massing capital investments and lead times. WE NEED AN ENERGY POLICY and not the communist manifesto just approved by the House committee.
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Sunday, December, 09, 2007 10:45 AM Pasadena Phil writes:

Sam

Governments NEED TO GET INVOLVED but not dictate the solution. In this country, the government is US. If we make it clear that we understand the enormity and complexity of the problem and demand protection from the global eco-anarchy movement and from frivolous lawsuit and capricious politicians, capital will work its way through the critical path that has been outlined by several commissions.

America not only still is a superpower, it is THE superpower. We are still the second largest producer of oil.

As to China, it just doesn't matter. There is debate going on as to whether Iraq or Kuwait have the second largest reserves. We are talking about 95 vs 95 billion barrels. A drop in the bucket. Iraq will only produce 2 million bpd which, if their economy ever rises from producing nothing but dust, they need for themselves. We are probably going to witness a world where no country has enough oil to export. That is why Iran feels compelled to build nuclear power plants in the first place.

As to American depression and dollar shock, the big story that kept the stock market from rallying on Friday was that the US economy is so strong and that the myth of the world economy "decoupling" from the US economy is unraveling. It is very possible, though unlikely, that the dollar bottomed last week. Dollar-denominated assets are now cheap beyond belief and there are trillions of dollars of foreign money just praying for the dollar to bottom out so they can come in and relax in a safe place. That is why there is so much pressure on Bernanke to NOT lower interest rates. We need to show the world that we have extracted our heads from our butts and place more importance in defending the dollar than bailing out crooked banks and their cronies in government. It it always a mistake to bet against America and people will be stunned to see how this subprime lending problem was just the lates Y2K.
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Sunday, December, 09, 2007 11:01 AM Nee writes:

You are so right!

And Phil, the other thing is that the people who seem willing to change have to wait on the local/federal government to get it! As you said, people have planted their feet. I honestly love the public transport systems...even as a kid, we had the train, and local bus that could get me from Seymour to New Haven. Boston holds a soft spot for me as a cultural mecca...being conservative though, everythig else does me in!!!
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Sunday, December, 09, 2007 11:09 AM Pasadena Phil writes:

Nee

The problem out here with buses and light rail is security. Gang bangers simply board the buses and jump the turnstiles without paying without fear of being confronted. It is one of the many examples of why we need to secure the borders, relax the right-to-carry laws and generally start getting real about dealing with everyone agrees are problems. Another problem is that it is generally considered "declasse" to use public transportation. That is changing. When it starts hurting the pocketbooks of us stockbrokers, we just make it cool to "stick our heads in the toilet and flush". We are the pigs in "Animal Farm".
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Sunday, December, 09, 2007 11:13 AM Pasadena Phil writes:

Nee

That reminds me, here in LA, one of the biggest obstacles to expanding the light rail system was that race merchants objected to designing the system around "rich people", you know working people who drive cars. They think it should be designed around the unemployed and homeless. That's why no one uses buses around here but homeless and unemployed. That's Mayor Tony Villa for you. What a guy! He's going to make LA a third world city if it's the last thing he does!
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Sunday, December, 09, 2007 11:25 AM Pasadena Phil writes:

Drudge just linked to this NYT article

http://www.nytimes.com/2007/12/09/business/worldbusiness/09 oil.html?ei=5065&en=9c63e1deedc9a1d4&ex=1197781200&partner= MYWAY&pagewanted=print

THAT is what I'm talking about. We will be running out of oil exporting countries in the not-so-distant future.

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Sunday, December, 09, 2007 11:27 AM BrianR writes:

Well

I'm with Doc Steech, and also stick by my comments on your last essay, which are too many and long to cut and paste here.

The main problem, to summarize, is political, on that we agree. I also assert that the degree of the "shortage" is overstated for various reasons: the existence of the shale (a HUGE resource), the advancement of other technologies, the idea that there's simply no way we've discovered every single source of oil on the planet yet (there are places we haven't even looked yet, due to technological limitations, like deep ocean sea beds), etc.

Also, let's not forget that in talking about rising oil prices, comparing $15/bbl 1970 prices to $90/bbl 2007 prices neccessitates adjusting for relative dollar values in order to be really meaningful.

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Sunday, December, 09, 2007 11:44 AM Pasadena Phil writes:

BrianR

You missed the big point. Read the NYT article and reconsider your comments. It takes long lead times to make a smooth transition to a world that is approaching us faster and faster. You are blindly betting on scientific and engineering miracles that the top scientist at CalTech dismisses outright. You are missing the economics of the problem and still don't seem to grasp the scale of how much oil we use. As an engineer, you should understand "miracles" don't appear in thin air. Take the missile defense system which has been describes ad hitting a bullet with a bullet. It sounds virtually impossible but it can be fairly accurately predicted how long it will take to succeed by trying, failing, recalibrating, trying again, failing, recalibrating again and so on. It's all about having the capital to fund the quality hours required from the best experts. That capital is NOT being deployed in sufficient numbers and the twenty years required in the best scenario is not going to be met. You're not getting it and choose to simply wave your hand in dismissing my arguments without offering a counter argument. The only factions agreeing with you are the OPEC nations and the international oil companies who are behaving like it we ARE beyond peak oil. That is my preamble included the statement about a little information is dangerous. Most people pick a specific fact and try to leverage that into not thinking about the rest of what is a very complicated problem. If I'm wrong, please, may your case. You're not offering anything but a statement that you don't agree. If you want a reading list, I'll send you one. I have professional reasons for being right on this. If I'm wrong, you are going to have to make a better case.
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Sunday, December, 09, 2007 11:56 AM Pasadena Phil writes:

BrianR

As an engineer, I think you could appreciate this analysis released by the National Academy Press not that long ago called "The Hydrogen Economy". It is complex and not easy to read for the layman but an engineer can appreciate it.

http://www.nap.edu/openbook.php?isbn=0309091632

There are lots of similar analyses available from expert panels who are researching the energy problem anticipating various solutions. This one explores the viability of hydrogen. After reading as many as I have, what strikes me is how they all run into the same anticipated problems and arrive at similar conclusions. We don't have much time to get over the problems and there are no "miracles" at hand. Even if there were, it is not a good idea to bet the global economy on a miracle.
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Sunday, December, 09, 2007 12:44 PM BrianR writes:

Yeah, Phil

I don't really want to rehash all this again, but lead times and all of that are predicated on the amount of resources committed to them. Right now, that committment is small to non-existent -- once again an issue of political will and dedication, not technological limitation. In less than a decade we went from Sputnik to a man walking on the Moon. That was an IMMENSE scientific achievement, and entailed almost quantum advances in engineering and science. That was because we made a commitment of resources to making it happen. That hasn't happened with oil, because the whole issue has been downgraded from being a national priority to being an issue of enviro-extremism. Oil pollutes: bad dog! Oil companies evil!

It's all politics.

Also, as we discussed, we're in the transitory phases to other technological approaches to many of our current energy usages. Alternative power for cars, for one thing. Mag-lev trains, etc. As those alternatives come on-line, the demand for oil will fall. Don't firget, we used to be a coal-based technology. Well, there's still a lot of use for coal, but it's now secondary. The same thing will ultimately happen to oil as technology advances.


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Sunday, December, 09, 2007 1:04 PM Pasadena Phil writes:

BrianR

Sputnik to the moon was an engineering feat, not a scientific achievement. There was little science involved.

Coal also remains the primary fuel for power plants and growing.

I really don't know why you are arguing with me Brian. You agree with me on very big points and then trivialize them with statements like "It's all about politics" and "we are in the transitory phases". Again, a little information is dangerous. Yes, we are in a transition phase but what we are doing is not going to solve the problem in time.

We can't be complacent because once we start on the "crisis to crisis" road, people are just going to surrender to the high priests of global warming. If we can't persuade people when they are calm, imagine how difficult it is going to be when an even more dumbed down society is in panic mode. You're not thinking this through.

How about we just discuss it instead of arguing?
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Sunday, December, 09, 2007 1:13 PM BrianR writes:

Wow!

Getting a man on the Moon entailed HUGE scientific advances. The whole technology of ceramics was essentially invented around that goal. Microprocessor technology, propulsion theory and the development of new fuel technology, and many other examples. It in no way was simply an engineering feat. Building the Hoover Dam was a pure engineering feat.

Engineering is the discipline of the application of technology to goal achievement. Scientific advancement entails the discovery of new processes, materials, technologies, systems, etc. There's an immense difference between the two.

As to coal, you're simply restating my position. Yes, it's used in power generation, its primary application. It is secondary to our society, which used to run almost exclusively on coal power.
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Sunday, December, 09, 2007 1:24 PM Pasadena Phil writes:

Pep

I really didn't address your first question. There are many reasons we don't drill offshore and the greenies are part of it only because doing so is not that appealing to drillers without subsidies. Those oil companies who clamor for drilling offshore are doing so more for the subsidies than for the rights to exploit a lucrative opportunity. Our offshore oil reserves just are not big enough to offset the economics of peak oil. That is what I am referring to when I argue that the international oil companies talk poo-poo peak oil in statements but when it comes to investing their capital, they are confirming that capital doesn't see opportunity. Most of the rest of the world subsidizes it's oil consumption. That is one of the big risks looming from government intervention. They won't solve the problem, they just want to manage it.

Another thing is that if we do transition to other energy sources, oil is irreplaceable for reasons that don't involve burning it. It is accurate to say that it is too valuable to burn and we should not be thinking about using it up in such great quantities. I believe it is a good thing for us to be using up the rest of the world's oil first. Whatever we don't use, they will continue to deplete after they stop exporting to us. They will then be dependent on us for alternatives which could be exporting oil to them for a short period of time. The sooner we wean ourselves from burning oil, the better. Running out of it isn't the only reason and global warming is a fraudulent scenario that may win the day if we all lose our heads in panic for failure to act when we had time.
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Sunday, December, 09, 2007 1:50 PM Pasadena Phil writes:

BrianR

You are confusing engineering with science. The science of propelling a man-made object into orbit has been known for a very long time. Developing the technologies that would allow that object to allow a living being on board was mostly engineering. In any event, we are talking in circles. You simply can't grasp the bigness of the problem and how late we are globally in taking the initiative in addressing it. Because of that, the globalists like Gore will keep pitching their "high priest" solutions to an increasingly dumb population desperate for any solution and unwilling to accept "twenty years from now" answers. I don't understand why you refuse to grasp this. There is a preponderance of hard data on everything I am saying and the most qualified experts coming from various directions are all arriving at the same conclusion. I'm not exactly advancing the level of understanding among the experts. All I am demonstrating with this essay is how utterly difficult (impossible) it is to discuss the issue factually and rationally. The vast majority of people do what you are doing. Establish a base of argument with a few facts and then refuse to contemplate the "bigness" of it. It is the "bigness" that trumps all of the other facts. The "bigness" is the main indisputable fact and people just insist on ignoring it.
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Sunday, December, 09, 2007 2:02 PM BrianR writes:

Okay, Phil

Whatever.
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Sunday, December, 09, 2007 2:14 PM Pasadena Phil writes:

Peak Oil

Thanks. This is such a frustrating subject. It is as if everyone is programmed to jump off the cliff. That is why we are going to have a major crisis. That is the only thing that gets people to pay attention. What persuaded me was the preponderance of independent research and how experts approaching it from different angles and with different objectives all agree on the bigness issue. Yet I can't get to square one with most people on this least disputable of all "facts". People insist on fighting a battle they have already lost. They are trying to play hockey without skates. You might be the best player on the ice but the worst player is beating you because he is wearing his skates.
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Sunday, December, 09, 2007 2:40 PM Pasadena Phil writes:

Peak Oil

You do understand that Cheney's statement will just trigger a wave of hate talk. I think it is high time that our government level with the citizenry about oil. It is the administration's insistence on arguing that the Iraq is about democracy in the ME that puts them in a corner. Oil is the most vital of vital national (global actually) interests and worth fighting over. The commenters here aren't stupid, like most everybody, they just have a blind spot. Sometimes too much information obscures the obvious.
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Sunday, December, 09, 2007 3:42 PM Pasadena Phil writes:

Peak Oil

I had an argument with a big name mutual fund manager a few years ago who claimed to believe in peak oil but couldn't understand that peak oil means that there is no surplus capacity in the system. He insisted that oil had just peaked at $48 and would soon return to below $35 once the high prices create demand destruction followed by a flood oil from new sources. I couldn't get a word in edgewise and oil soon went up another $10. This was a guy who has access to the best research yet he couldn't grasp the concept. It really is hopeless.
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Sunday, December, 09, 2007 3:45 PM Pasadena Phil writes:

BTW

That Cheney statement was a political statement. Were the ME nations to open up, all research points to likelihood that this would confirm that OPEC is bluffing when they deny peak oil and that they have ample reserves. They have lost pricing power, they know it and are grasping at straws. They are also deathly afraid of an America that commits to finding alternatives. We never fail when we turn to innovation.
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Sunday, December, 09, 2007 3:52 PM Pasadena Phil writes:

Peak Oil

It is disappointing that our politicians won't give us credit for having the intelligence to handle the truth.
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Sunday, December, 09, 2007 4:46 PM Pasadena Phil writes:

Peak Oil

I don't real hold Medved's opinions in very high regard. Hugh is a political operative who places Republican interests above his own preferences. If is important for Republicans to bring up this subject, Hugh will bring it up and spin it IMHO. I just don't think a political blog s the best place to discuss this. It will get demagogued and spun into oblivion. You spend a lot of time on the senior circuit posting comments. Have you gotten into many rational discussions? I doubt it. Mostly hyper-artisans shilling and attacking for "their guy". Same with this. Republicans are very sensitive when it comes to oil, especially with two oil men as the top execs. And don't get the idea that I believe that what is going on is necessarily sinister. I can easily make a case that we are just shaping the landscape for America to re-take control of oil prices by being the top producer with declining domestic demand. OPEC has lost pricing control and was recently caught faking a production increase. It can easily be all just a game of global politics we are winning. But we need to shake the "doom and gloom" crowd whether it is the Gore's Temple of Doom or Ron Paul's "It's our fault and deserve what we have coming" school of thought. We need to get off of that track NOW.
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Sunday, December, 09, 2007 4:57 PM xpressit writes:

Phil

"At what point do the economics of scarcity overtake the economics of abundance?"

Here is another timely article to fit your subject:
http://www.nytimes.com/2007/12/09/business/worldbusiness/09 oil.html?_r=1&th&emc=th&oref=slogin
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Sunday, December, 09, 2007 5:01 PM Pasadena Phil writes:

xpressit

Thanks but I beat you to it! I posted the same link at 11:26am. Appreciate it though. It is a very complicated subject.
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Sunday, December, 09, 2007 5:28 PM xpressit writes:

Phil

Sorry I didn’t see it, ugh.

You’re right, complex. There is some rationale for applying similar concern to general economic growth. (You’re probably aware.) While many believe all growth is all good, there is a tradeoff -- at some point growth multiplyies cost. I know its off subject, but worth people thinking about. For instance, would we live with modest 1-1.5 percent growth etc? We want more and, in a command economy, we think its better too. So does China. Over a certain point the expense factor of growth is realized, just like scarcity at some point conflicts with abundance. It affects fuel for one, but other things too.

"The big capital, the best informed, is telling us that we are in a peak oil environment. To waste time on these projects is like trying to save Africa by teaching Africans how to make bricks. The problem requires a bigger solution."

Oil companies tell us. But are they indeed part of the problem or part of the solution?

That’s fair to ask. They tell us its too costly to build new refineries, and too much gov’t tape. So none get built. In the 70’s opponents protested nuclear power and halted development. Who do we listen to? My friend was on the team that did the first cross-country trip in an electric car. They became conflicted over the source of electric. ‘What is the tradeoff or gain’, they ask?

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Sunday, December, 09, 2007 5:44 PM xpressit writes:

Peak oil

Good point. But over there while they are subsidizing their prices, and demanding more, we are seeing the rope tighten. Dubai is already building an alternative economy, with petro dollars, for when they believe their oil-producing dollars run out. But alas, a service sector will still use mega energy in the process. So does building it. (burning the match at both ends? & no answer)
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Sunday, December, 09, 2007 5:51 PM Pasadena Phil writes:

xpressit

Hard to say whether the oil companies are part of the problem. It is safe to assume that they act in their own self-interest and those interests are closely aligned to our national interests. The advantage of free markets is that companies are motivated by profits. But oil is a unique industry. Left unregulated, it will self-destruct by regressing back into the boom and bust cycles that used to plague the industry in the early days. Stable economies demand steady oil prices. It is noteworthy to point out that the oil industry took off AFTER Standard Oil was broken up. John D. Rockefeller's wealth exploded once the breakup "unlocked shareholder value". The key to the breakup was separating his oil interests from his railroad interests. He built Standard Oil selling lamp oil. The real fortunes were made once the capital environment stabilized which justified longer term and larger term capital investments required to fuel the fast growing electric utility and automobile industries. In other words, I think oil companies are neutral in the equation as they respond to the changing environment.

As to refineries, the way I understand it, too much is made of the decline in the NUMBER of refineries when you consider that overall refinery capacity expanded over that time. My understanding about new refineries is that it depends on whether we can agree to a realistic national energy policy that clarifies the risks associated with shale, coal and other resources. We clearly don't want to build new refineries along the gulf coast or any coast if we are going to reduce imports. It would make sense building closer to the shale and coal but no one is going to make those enormous capital commitments without legal protections.
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Sunday, December, 09, 2007 6:01 PM Pasadena Phil writes:

Peak Oil

People forget that WWII was largely about oil. A local public TV station recycles the "Victory At Sea" series regularly and they covered the Atlantic convoys recently where they stated point blank that the largest cargo by far was oil. It is no accident either that the Nazis were first defeated in the ME. It was also the Nazi occupation of Iraq that planted the seeds of the Baathists. Warring in the ME over oil has been an issue since "Lawrence of Arabia".
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Sunday, December, 09, 2007 6:14 PM Pasadena Phil writes:

Framing the issue

One of the things I pay attention to is how much of the news tends to downplay the viability of solar, wind and other alternatives by point out how trivial they are to oil. Solar is growing in leaps and bounds these days and new buildings don't use incandescent bulbs that waste 95% of their energy generating heat. It's not all about how much power is created by one technology versus another. There are also gains made in efficiency that negate the need to generate as much energy by the new technology to achieve the same net result requiring more energy from the old technology. Those things are difficult to establish with the way this gets reported. Green urban roofs, windows coated with solar electric lacquers or solar film, the efficiencies are enormous and can greatly reduce the demand for electricity from the grid. I'm also a big proponent of distributed generation feeding into the grid and the elimination of long-distance transmission and giant power plants.
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Sunday, December, 09, 2007 6:28 PM Pasadena Phil writes:

Peak Oil

That's very interesting. I don't understand what repurchasing their shares in full accomplishes. They could be using that cash for capital investment in alternative technologies or increasing their dividends. My theory is that they are parking their cash in treasury stock for future capital needs as they progress "beyond oil".

I don't necessarily buy into the "liquidation" comment beyond the fact that they are selling their oil fields sooner and more oil-rich than they used to. This is a golden age for the specialty oil companies like Apache and Murphy who normally buy these fields when the easy stuff is completely depleted. There is a lot of meat on those formerly bare bones these days.
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Sunday, December, 09, 2007 6:44 PM Pasadena Phil writes:

Peak OIl

Yeah, I'm familiar with that quote but he said it back in 2003 if I recall correctly. Even then, all it represented was 25% of all the roof area of all commercial buildings. That was very doable then and requires much less today with the vastly improved solar materials.

As to my astuteness on financial issues, I really don't have command of the finances of the oil industry. But I am four-square in agreement with the J.B. Johnston quote I included in the essay. If we want market solutions, we need to make the capital markets more friendly to oil/energy capital. It is anything but today.
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Sunday, December, 09, 2007 7:01 PM Darvin Dowdy writes:

I simply refuse to believe...

...that the sky is falling. Will we and future generations have to put on our thinking caps? Yes. Of course neither do I believe that big oil is evil. I'm sure you were being tongue-n-cheek there PPhil. Oil companies are made up of people and they're out there doing a fairly good job of getting that sludge out of the ground, processed and into the tanks of our cars. And they deserve to make a profit. And oil companies are providing some of the few remaining high paying jobs for folks replacing the manufacturing jobs being lost.
There's oil shale and tar sands. Lets not forget natural gas. There's lots of NG. I think it'd be cool to see all government vehicles required to use compressed natural gas. Put regulations on themselves for a change. I'm certainly not crazy about methanol or wind power. I'm glad to see America's farmers having a bit of a windfall, however. Went up to Wisconsin awhile back and folks were growing corn anywhere they could find to grow it. Side yards, vacant lots. Those folks up there can grow some beautiful corn, too. Twice as big as what I see here in TX.
But I feel like we'll solve this problem in time. And I hope when we do that we're not putting one dime in the pockets of some Saudi and Kuwaiti sheik/prince. Or do they even have pockets? Ha! DD
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Sunday, December, 09, 2007 7:18 PM Pasadena Phil writes:

Darvin

Yes, I was being tongue in cheek and I'm with you 100% on the oil companies. They deliver the most important liquid on earth as the cheapest liquid on earth. That is an amazing accomplishment. Did you know that there is a shortage of skilled oil workers? There is also a chronic shortage of offshore oil platforms. And our universities are no longer producing petroleum engineers either. The focus today is on "earth sciences".

All of the alternatives figure into the mitigation process including ethanol. Once the Dept of Agriculture produces an effective enzyme to breakdown switch grass on other abundant and cheap sources of biomass, that industry will take off. We can't use corn, wheat, soy and other food grain for long. The solution to the upcoming oil crisis is "all of the above". All alternatives have a place in the near and intermediate term. A big solution will take at least fifty years and no one knows what that will be.
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Sunday, December, 09, 2007 7:22 PM Pasadena Phil writes:

Peak Oil, Darvin

Interesting point about food. I've been noticing more and more news stories about the health risks associated with having so much corn and corn byproducts in our food. We already know how "evil" meat is. Are we heading into a world where we survive on food pellets?
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Sunday, December, 09, 2007 7:36 PM Pasadena Phil writes:

Peak OIl

One of the interesting aspects of the peak oil discussion is how many of the peak oil advocates are former engineers of the big oil companies who are denying peak oil. Kenneth Deffeyes was the chief geophysicist of Shell for many years and was involved in discovering and developing much of the world's current oil supply.
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Sunday, December, 09, 2007 7:42 PM Pasadena Phil writes:

Peak Oil

I've been noticing that organic produce is becoming very price competitive lately. And in many cases, the quality, at least taste-wise, is better.

The other thing about pest control, as I understand it, depends on continually developing new strains of genetically altered grains. One of the Dept of Agriculture's tasks is to come up with a new strain every 7 years, just like in the bible. Seven years of feast followed by locust-created seven years of famine.
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Sunday, December, 09, 2007 8:19 PM Pasadena Phil writes:

Not surprised

The Bush administration has no credibility left. Can anyone trust them? Are the Brits just transferring their troops to Afghanistan like the previous Iraq redeployment?
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Sunday, December, 09, 2007 8:57 PM Pasadena Phil writes:

Peak Oil

Gordon Howard has looked very weak since he got in. It is not helping his case that Bush has turned into Jimmy Carter on Iran nukes and risking the next intifada with that desperate summit in Annapolis. There is simply no coherency to this administration except for surrendering our sovereignty and leaving the biggest, out of control bureaucracy in the history of mankind behind him as he leaves. You can't defend the guy even if you wanted since he doesn't defend himself.
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Sunday, December, 09, 2007 10:22 PM Pasadena Phil writes:

Peak Oil

Also:

"No Deserving Student Gets Ahead"

"Never Met A Spending Bill He Didn't Like"

"Cushy Jobs For All Of My Trust Fund Friends"

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Sunday, December, 09, 2007 11:14 PM xpressit writes:

Peak O

...7:05 The vast majority of Americans have their heads in the sand, and believe that access to cheap and powerful energy is their birth right as Americans.

Not that I am trying to argue against this, but "head in the sand" to me is a wide preoccupation living out their freedom – the freedom to ignore what is out of their myopia, or control. Call it ignorance, complacency, or arrogance. Cheap? Not anymore.

One aspect is we are pruned to demand and await government solutions. Not to make excuses for people here, but many are raised on one technology platter are now told that won’t be acceptable. That alone send shivers into markets as well as people. I do see creative ingenuity happening in building markets. But people do have to demand alternatives and new procedures - then afford and pay for them when they come. (not wait till the x-box is cheap)
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Sunday, December, 09, 2007 11:59 PM Pasadena Phil writes:

Peak Oil

I happen to agree that some offshore drilling will be allowed but I really doubt ANWR will ever be allowed. I think the most likely drilling will take place off of Florida if for no other reason than to drain it for ourselves before Cuba (via China) does. I also believe that it is in our national interests to preserve as much of our reserves as we can and expedite alternatives. The magic formula is to keep the economy growing smoothly while continuing to improve our energy efficiency and be the primary exporter of alternative energy technology. We need the oil for better uses than to burn it and having sizable reserves will give us the upper hand on pricing again. The instant our oil imports begin to decline, we will have regained control. Right now, no one does. We are the only ones who can do that and the payoff would be huge. It would be a giant new industry that creates a ton of high-paying manufacturing jobs.
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Monday, December, 10, 2007 12:27 AM ShiningCity writes:

I applaud

you for tackling this topic, as I'm more the Erma Bombeck sort myself. I have nothing intelligent to add, but that won't keep me from giving an opinion or two. And they are these:

1) I read it, and re-read it. It's a difficult piece/topic, as are the comments especially for someone like me who is an economic retard. Still, I never saw what you expect me to do about this, once I admit that "Ok, yeah, vanishing oil IS a big deal." What then, Phil? I'm a physician educator. Am I supposed to fund something, or make something? Basically, I'm in the position to do nothing except wring my hands about it. And I'm not in the habit of doing so. (And that may be the biggest reason that many readers just won't entertain this idea...)

2) I get what you are saying about the validity of research here, but it seems to me much of this is like any other science (or any other observation): it's all info gathered from different perspectives of people viewing the same traffic accident. Some ideas jive, others don't. Doesn't necessarily mean the science is bad. It's just people's interpretations.

3) I understand Brian's perspective. I remember AIDS, 1986. Just learned what was causing it. And within 10 years, we've got drugs to expand peoples lives to a normal lifespan. This happened because of panic & pressure, which fosters unusual progress in science AND engineering.

4) In the same vein as #1, I can't remember a single issue where large scale panic about a potential issue actually was supported by eventual development of the "issue." That doesn't mean it won't happen, but I think it's part of why many reject your discussion here, along with data.
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Monday, December, 10, 2007 10:36 AM Pasadena Phil writes:

SC

Thanks for dropping by and giving it a shot. This was not an alarmist essay. It was just an attempt to introduce some BIG basic facts into the political nonsense that dominates the public discussion. Unless you immerse yourself into this subject, it is almost automatic that you fall into one of two main camps: "there would be no problem if we killed all the tree huggers" or "the evil oil companies are conspiring with evil governments to hide supplies". ALL of the studies (you're a doctor, you understand how hard it is to go up against a preponderance of independently verified data) is telling us that the growth of consumption has, or soon will, overtake the world's ability to meet demand. We need at least twenty years before that point to get ready. That is the problem. People refuse to see the problem and act (read the comments here) as if you can just flip a switch when the OCEANS of oil we use very day can't be supplied. It's the bigness that people refuse to deal with. Like usual at TH, these discussions tend to turn into echo chambers where poeple will discuss only so far as their opinions hold together. Otherwise, they leave. Just thought I'd give it a try. I'm not an expert on this but I know what I know and I know it well. It doesn't require a PHD in zoology to identify a gorilla with certainty. On this issue, we can't see the gorilla because we don't want to. We don't need to panic, but if we don't get it right, there are major political forces dumbing us down who might jump in and exploit our fears to impose a global government on us. We are one crisis away from that and we can and better avoid it. My money says that we won't.
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Monday, December, 10, 2007 11:32 AM BrianR writes:

Phil

New essay up at the Island. Check it out.

Sorry to plug and run, but there it is.

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Monday, December, 10, 2007 1:00 PM Pasadena Phil writes:

Shell expanding refinery

http://www.breitbart.com/article.php?id=060428150248.kurimp 3k&show_article=1

This will make the Motiva refinery the largest in the country. Despite the hoopla, this is probably more about public posturing than providing a practical, long-term solution. It's not clear that this expands overall capacity or simply replaces capacity lost at other storm-damaged refineries.
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Monday, December, 10, 2007 5:04 PM Georgetwin writes:

P Phil

My Latest Posting Beckons!
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Monday, December, 10, 2007 7:50 PM Jimmy Carter writes:

Here's a thought:

Let's get the governments out of the private sector....as the resource depletes the price will go up, therefore having some finding alternate solutions for their own lifestyle.

It appears to Me that You think everybody is burning oil and it will be gone soon, well not if governments let the market dictate the energy we want to use.

"Tragedy of the Commons" that Our ol' Buddy Scottie likes to remind everyone.


You state that 50 years ago they couldn't conceive of the economy We would have today...I state you cannot predict the energy We will be using 50 years from now.
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Monday, December, 10, 2007 8:10 PM Pasadena Phil writes:

Jimmy

We can't predict what energy we'll be using even 20 years from now. As to government involvement, there may come at time when we are better off with no government involvement in energy distribution, but so far as oil is concerned, the unfettered free markets that preceded big oil were a disaster. It was only after the government broke up the trusts and then when the world organizing around a cartel that enabled the stability required for the industry to thrive. It's about balance, not government control. The oil shocks were the result of poor planning in advance of predictable shifts in pricing power. Just like today. OPEC has lost control of oil prices and so the market is back to setting price. That is why prices are so volatile and why they could skyrocket. They are out of control.
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Tuesday, December, 11, 2007 12:34 PM George Sarant writes:

Oil Trusts

It is interesting to note that when the trusts were busted the primary use of oil was not what it is today. Until 1910 the main byproduct of oil refining was kerosene. Only from that point forward was gasoline predominant.
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Tuesday, December, 11, 2007 12:45 PM Pasadena Phil writes:

George

Thanks. That is a very important point. I made it earlier but it can't be mentioned often enough. I'm an open markets guy but some aspects of our economy don't lend themselves to "laissez-faire" government policy. Government intervention to break up a monopoly unleashed a period great economic growth. The danger today is the we are going to fall prey to a non-democratic global government (think European Union style UN) making allocation decisions for a scarce commodity while disincentivizing innovation that comes from a friendly environment that encourages risk capital to get involved. We are not even in a crisis today and yet the world is already surrendering to the global warming nuts. Imagine how nutty it's going to get the next time we have to wait in line to buy gas.
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Tuesday, December, 11, 2007 5:34 PM Pasadena Phil writes:

Peak Oil

This is all inferred evidence that these countries are running out of oil to export. And today, the Fed further weakens the dollar which subsidizes other countries' oil on our dime. If Ron Paul is one good thing that could come out of Ron Paul running as an independent, it is he might spark a much-needed serious discussion about why we need THIS Federal Reserve. Might as well put them on the Citibank payroll if they prioritize bailing out the banks over defending the dollar and allowing the economic cycle to slide into the next phase.

BTW, I do see a silver lining in all of this. I see the U.S being in the driver's seat on energy as the biggest exporter of alternative energy technologies and re-taking control of oil prices once no one can export anymore. It requires that we NOT drill domestically and expedite the development and deployment of these alternative energy technologies as they evolve. I'm having a hard time though figuring out what a non-oil-
exporting world would work.
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Tuesday, December, 11, 2007 8:03 PM Pasadena Phil writes:

Peak Oil

It's not that I believe the Fed should be abolished, maybe it should but I believe it was established for a very good reason and was instrumental in ending stagflation in the late 1970s into the Reagan administration. But I really feel strongly that we need to take a real close look at whether they haven't drifted towards being a tool for the big banks since Greenspan. It could send a message to the other regulators in other industries, like the FDA, AICPA and others e.g.
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Tuesday, December, 11, 2007 9:52 PM Pasadena Phil writes:

Peak Oil

The debasement of our currency has little to do with the Fed and plenty to do with our fiscal deficits and trade deficits. I believe that the Fed messed up big today and it was reflected in the stock, bond and commodity markets. Oil was up over $2 and gold jumped up too. You would think that a cut in interest rates would have triggered a rally in the bond market but a sell-off ensued. It would have been better for the Fed to either NOT cut rates, or cut rates a half but follow it up with a stern statement that clarifies why he did that, that it is only short term and that it is specifically for the purpose of giving the banks one more month to clean up their mess. Instead, it was about a slowing economy that only he and the troubled banks see and "liquidity" issues. This Fed has zero credibility in the global and domestic markets and this made it even worse. For a Citibank or JP Morgan to be faced with the prospects of explaining themselves in front of a Congressional panel as potential criminals would be much more helpful here than anything the Fed can do. Won't happen.
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Tuesday, December, 11, 2007 10:08 PM Pasadena Phil writes:

Sam

There were several Wall Street analysts and economists calling for the European to cut rates instead of raising them. Combine with last week's talk of the global economy "recoupling" with the US economy, what you described may very well be the plan. I doubt the Europeans are going go along with it anymore than the smaller banks went along with the Citi/JP Morgan/Wachovia/Merrill "super toxic fund" plan. HSBC and UBS surrendered last week and simply folded their SIVs onto their balance sheets and with the auditors being forced to sign off on the 2007 financial statements, the walls are closing in on the banks. The dollar looked liked it had bottomed last week but you can kiss that off after today's Fed fumble.
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Wednesday, December, 12, 2007 11:02 AM Pasadena Phil writes:

More Saudi info

WSJ today reports that the Saudis are busy investing over $600b in smelters, seaports, refineries, and other heavy industry that will create substantially more domestic demand for their dwindling oil supplies.

http://online.wsj.com/article/SB119741973183522173.html?mod =yahoo_itp&ru=yahoo

They want to be exporting primarily chemicals and processed metals. I wonder why.
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Wednesday, December, 12, 2007 12:47 PM Pasadena Phil writes:

Peak Oil

Someone, I think it was Goldman, came out this morning and bumped that up to $95. Oil (+2.24), gold (+$16) and interest rates are up today. The Fed is really dropping the ball here by compounding yesterday's mistake with today's announcement.
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Wednesday, December, 12, 2007 4:06 PM Pasadena Phil writes:

Peak Oil

No, that quote was average for 2008. Word from the CBOE floor is that oil is headed for $100+ before year end. If it gets past and closes above $95, we are probably going to see $100. There is no confidence in the banking system right now. The TED spread is over 50 points. Interest rates are too low and there are big pockets of loose money floating around. We are probably going to see a very high profile bank bankruptcy soon. My guess? WAMU. And Citi just hires a CEO with zero retail banking (75% of Citi revenues) experience. Just how bad are things over there that they can't find a qualified CEO?
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Wednesday, December, 12, 2007 7:10 PM ScarletPimpernel writes:

good work, PPhil

I've been avoiding reading your entry for 2 days now because it reminded me of college assignments:) But it was easy to read afterall while still being educational.

I checked out a book 2 weeks ago called, "The Bottomless Well" by Peter W. Huber and Mark P. Mills. I haven't gotten too far into yet but it is very interesting. They say that we will never run out of energy for one thing. Coal and uranium will play a big role in the future.

What I really found enlightening was that they point out that energy efficiency NEVER lowers demand. That makes total sense. Funny how most of us never looked at it that way.

I may blog on it after I've read it as a compliment to your entry.
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Wednesday, December, 12, 2007 7:16 PM Pasadena Phil writes:

Peak Oil

I'm tuned into Bloomberg all day long (highly recommend over those bozos at CNBC) and the "experts" just don't get it. The standard poop about the spike on oil prices was befuddlement. They all expected that the projection of a soft economy ("i disagree)next year would soften demand for oil and prices would go down. My take: so long as the yield curve stays inverted, cutting interest rates does not help the economy because the economy thinks rates are all ready too low. All the Fed is accomplishing is to tank the dollar and have the US subsidize oil for the rest of the world. Too compound the Fed's blunders the past two days, the Fed also indicated that they are concerned with the volatility in the CBOE and are planning on intervening. Great. The Central Planning Committee has now decided that the markets are coming up with the wrong prices and will step in and correct it. So much for the "hidden hand" of free market capitalism. At this point, it would be better if the government just stepped back and let the markets correct the problem by forcing the culprits out of business.
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Wednesday, December, 12, 2007 7:45 PM Pasadena Phil writes:

ScarletP

I can't wait to read it. There is a short but very easy to read book called "Out of Gas" by Dr. David Goodstein, Vice-Provost of CalTech here in Pasadena. I strongly recommend reading it. There are all kinds of books on this subject that arrive at very suspect conclusions citing the same information. It is important to understand the basic science which is what this book does. If you ever saw "The Mechanical Universe" on PBS, that was Dr. Goodstein. This is a complicated enough subject without establishing the scientific parameters first.

Nuclear is a short-term solution because there is a shortage of uranium too. The main plan is to use ALL alternatives for 30-50 years until a big solution can be developed. Nuclear fussion, if it is even physically possible, is the most popular on cited. If you want to get into a good discussion about this, Susan Reynolds of TH knows a lot about it. Her link is on my blog roll "Susan Rules!". I am pessimistic about it, she's not. I can't see how you can ever contain a nuclear explosion within a plasma field.
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Wednesday, December, 12, 2007 7:47 PM Pasadena Phil writes:

Here's the link for "Out of Gas"

http://www.amazon.com/Out-Gas-End-Age-Oil/dp/0393326470/ref =pd_bbs_sr_1?ie=UTF8&s=books&qid=1197506781&sr=8-1
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Wednesday, December, 12, 2007 7:52 PM Pasadena Phil writes:

BTW ScarletP

It is one thing saying we will never run out of energy, it's another to say that they will continue to be ample CHEAP energy. There is no global economy without cheap energy. Coal and nuclear are not as potent as oil and only address part of what we need oil for. That is one of the reasons this is so complicated. It is easy to be led down the wrong path with facts.
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Wednesday, December, 12, 2007 8:30 PM ScarletPimpernel writes:

yeah, PPhil

Things will get very interesting as China demands more. And their coal use makes the coal dust hang about 10 feet off the ground already! When they mature economically it will get real competitive and, literally, real dirty.

Forgive me if anyone else has already said the same thing. Much traffic on this post.
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Wednesday, December, 12, 2007 8:33 PM ScarletPimpernel writes:

ironic

Wouldn't it be ironic if we ran out of cheap fuel, individual state economies worldwide collapse and we end up riding horses and mules again? I mean, no long range missiles etc. More exercise for everyone. Things would slow down and go back to how they were.

This might all have been God's experiment, or for Nature lovers, it might be Nature putting us back where we came from. Kind of funny, that.
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Wednesday, December, 12, 2007 8:50 PM Pasadena Phil writes:

ScarletP

I really don't see a collapse of that magnitude. I'm trying to work out what the economics will look like when no one is exporting oil anymore. I'm leaning more and more into thinking that we should NOT be drilling off shore or anywhere else until after that moment arrives. We are still the 2nd biggest oil producer in the world and the Saudi's are precarious at 1st and will be diverting more and more of their production into new domestic needs. I think we could become the biggest exporter in the world in 10-15 years of alternative energy and technology. It won't happen if we panic at the first crisis and surrender to UN one-worlders. We need to have a positive mindset which we don't have.
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Wednesday, December, 12, 2007 9:53 PM Pasadena Phil writes:

Peak Oil

Thanks for the info. Somehow I missed when Russia overtook us in production.
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Wednesday, December, 12, 2007 10:51 PM Pasadena Phil writes:

Peak Oil

The term "proven" is subject to many interpretations. Assumptions about price and technology can lead to widely varying results. I am surprised our reserves are that low but I don't have a better number. If that number is correct, it looks like ethanol has a bright future and soon.
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Wednesday, December, 12, 2007 10:56 PM Pasadena Phil writes:

Peak Oil

I've seen that before. It's those kinds of numbers that demonstrate how big the problem is. My favorite is that American automobiles consume about 9% of the world's oil production. That can be remedied fast painlessly.
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Wednesday, December, 12, 2007 11:20 PM Pasadena Phil writes:

Peak Oil

Makes you wonder what the government has planned. Is that why they want to take our guns away? Is that why they don't care about borders? Something just doesn't make sense which always means that I am missing important information. There are lots of variables to consider. We can quickly curtail much of our consumption by reconverting our power plants back to coal and mandating more stringent fuel efficiency for autos. Incandescent light bulbs are also a big problem but bringing that up is always risky. We do waste energy in this country.
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Thursday, December, 13, 2007 2:43 PM ScarletPimpernel writes:

PPhil

I understand that South American countries, Cuba and China etc are drilling all around coastal North America. Yet you say we should wait. Should not we at least get our claims in?
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Thursday, December, 13, 2007 3:06 PM Pasadena Phil writes:

ScarletP

It's only the oil off of Florida as far as I know, but I said "if possible". There isn't enough there to make a difference which is the main point of this essay. The country/countries who make the transition first to alternatives will be the big winners. We are well poised to do that, if the government will make the capital environment friendly. Nothing is accomplished playing "hungry,hungry hippo" in grabbing whatever foreign oil is left. Work with the numbers and you tell me how much new oil we need to solve the upcoming shortage. We are talking about a world needing 95 million barrels per day soon at the same time supplies are dwindling and production has plateaued. If you are going to argue shale, look into the numbers. Same with nuclear. Those who make those arguments state indisputable facts while ignoring the big numbers in offering small and temporary solutions.
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Thursday, December, 13, 2007 4:26 PM ScarletPimpernel writes:

OK

I'm buying a horse.
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Thursday, December, 13, 2007 5:14 PM Pasadena Phil writes:

ScarletP

Horses and dogs. That's what Peppermint did. Works for me.
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Sunday, December, 16, 2007 12:29 PM BrianR writes:

Phil

I just posted a new Christmas-themed essay at the Island, "The Christmas Care and Feeding of Liberals"

Swing on by.
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Tuesday, December, 18, 2007 9:35 AM Georgetwin writes:

P Phil

My Dad is gone. Blog posting with details.
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Tuesday, December, 18, 2007 10:23 AM Pasadena Phil writes:

Georgetwin

I am so sorry to hear that. I'll be over.
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Monday, December, 24, 2007 10:00 AM -Kilroy writes:

Pphil

Special Christmas greetings up over at Kilroys!
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Tuesday, December, 25, 2007 2:47 PM ShiningCity writes:

Hope you are

enjoying you holidays. CM
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Tuesday, December, 25, 2007 2:47 PM ShiningCity writes:

Hope you are

enjoying the holidays. CM
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Wednesday, January, 02, 2008 11:46 AM BrianR writes:

Phil

Well, now that the holiday's are over (by one day) it's time to get back to the fight for Truth, Justice and the American Way. To that end, I've just posted a new essay at my blog, so come on by!

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Friday, January, 04, 2008 10:08 PM xpressit writes:

Phil

On the side, I saw your comments on HH blog. Great posts. I used to think he was a reasonably intelligent guy, but am wondering lately. He and Rush seem to suffer from politicitus recently. (new word) The views are a little off the wall. Rush was dripping venom in pointing out Hill's defeat was (apparently) ignored by all media ignored. Hope its not contagious anyway :-)
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Saturday, January, 05, 2008 8:45 AM davecatbone writes:

I'm soooo late to this party

But I've enjoyed the piece immensely anyways. Thanks and good work Phil. This is the biggest issue of our lives, and it doesn't have to have a bad ending. Conservatives understand the need for more refinery capacity, and nuclear power is doable if the required safeguards are demanded. I'll be watching this more closely!
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Saturday, January, 05, 2008 11:16 AM BrianR writes:

Yo, Phil

Where ya been? Haven't seen you around anywhere, lately.

When you gonna post a new essay?
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Saturday, January, 05, 2008 11:23 AM Pasadena Phil writes:

Everyone

Sorry for "disappearing". Between my year-end chores at work, the holidays and my Rose Parade duties, I haven't had time to even visit. This is a very busy time for me at work too but I'll get back into the swing of things soon. I appreciate that I haven't totally alienated everyone. I guess I'm just not one of those "Highly Efficient" people.
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Saturday, January, 05, 2008 11:32 AM Pasadena Phil writes:

BrianR

I did read your new essay and I don't even remember if I left a comment. But is was a very scholarly essay. You are becoming very professorial.

As to my next essay, I am noodling around with an essay on how the GOP is now so small that Democrats and independents can now pick the nominee. John Hinderaker at Powerline alluded to it yesterday in his "Silver Lining" post and I e-mailed him this morning asking him to get Michael Barone to reveal his numbers and discuss what if the GOP is even viable anymore. Based on what I see in IA and NH with the Obama phenomenon and GOP crossover, I believe the GOP may now be down to as low as 20%. I've heard Sam Donaldson and John Leboutellier separately discussing the likelihood of a viable third party run. Sam says that Perot could have won in 1992 had he not gone nutty with his claims that the CIA ruined his daughter's wedding, dropped out of the race and then re-entered and then his "world-class wife and world-class daughters" and "champagne music" nuttiness. That nut still got 19% of the vote. A Perot could actually win in 2008.
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Saturday, January, 05, 2008 11:33 AM Pasadena Phil writes:

Kilroy

Geez, I completely forgot about you. I'll be over soon.
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Saturday, January, 05, 2008 11:36 AM Pasadena Phil writes:

Peak Oil

I don't know about $150 bbl but I think $120 soon. $100 was just a psychological barrier. I listen to "experts" everyday all day long talking about "fundamentals" (oil should be $54-55) and "speculation" (hedge funds) to argue that the price will soon be coming down. What none of these experts will acknowledge is that the cartel system is broken and the global market is now dictating the price of oil. THAT is peak oil defined.
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Saturday, January, 05, 2008 11:40 AM Pasadena Phil writes:

xpressit

I'm not down on Hugh. I just think he is too quick to grasp anything as a way to spin Mitt. I don't know who he talks to about markets but he seems to have a very pedestrian, politically-based view of how they work and what is going on. The truth is that "markets" don't have the attention span to worry about politics. I am more disturbed about what it reveals about Hugh's politics that he doesn't see how incoherent it is for him defend both Romney AND Giuliani. I suspect he just wants to remain relevant to the GOP and is hedging his bets.
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Saturday, January, 05, 2008 11:53 AM BrianR writes:

LOL, Phil

Okay, good, you're still alive. I saw your post at my place... looking forward to your new essay. Gonna hold you to that!

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Sunday, January, 06, 2008 2:30 AM xpressit writes:

Phil

politically-based view of how they work...

That's about the impression I get. ALl things thru political prisms. On the subject though I was looking into the enron loophole and it is interesting. We probably agree on a lot though. BTW, this post probably gets more relevant as time goes.
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Sunday, January, 06, 2008 11:59 AM Pasadena Phil writes:

xpressit

Thanks. It is utterly impossible to have an intelligent discussion on this subject. I invest for a living and it is astounding how many "experts" I talk to who have adopted a line and that is the best they can do. Think about that the next time you listen to CNBC or Nightly Business Report or any investment shows. Just because you manage billions of dollars of other people's money doesn't mean you are smarter. That is why the hide behind "diversification" and "asset allocation". They aren't confident in their core strategies either.
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