The problem isn't enough energy. This reminds me of the 70's "energy" crisis. We have about 4 times as much capacity since then. The problem is that we have a "monetary" crisis. It's one of the biggest sources of pain in the world. In the 70's the price of oil went up 10 times, but really the price of oil didn't go up, but after Nixon closed the gold window in '71 the value of the dollar went down 10 times. That's what caused the devastating inflation. Now, the dollar and all major currencies "float" there is no standard unit of account. Back in '97 we had a deflation because gold was at $250, and that's when oil was 10-20. Now gold is at $450, the dollar almost half its buying power and oil is $60. The fed has the power to stablize the dollar by the amounts of liquidity it lets into the system, but they don't.

i think this is a very important issue you've raised, sumant. as an ardent capitalist, i believe the 'market' will provide solutions. the market solutions won't be proactive like many of us would instinctively like i.e., we want solutions that pre-empt the issue. But certainly, I believe the market will lead to a reactive solution based on people's responses to the problem (which they are and will continue to see in the form of price). in a micro sense, the market will change the equilibrium point where supply and demand meet. the suv demand decline is a good example of this. interesting, despite this suv demand decline, we have learned in the past few years that people's demand for oil is not all that elastic. most of us just 'deal with it' and pay more...likely shifting funds from other, more discretionary expense items. in a macro sense, too, i believe the market will figure it out. as oil prices continue to rise, or at a minimum stay high - the market will develop a combination of more oil efficient machines and ultimately, cost effective alternative sources of energy. look at the hybrid market in america today. we're not yet at the point where the economic rationale for buying a hybrid is a no-brainer. but we're much closer to it, i believe, than we would have been had oil prices not been so high in the past 5 years!

Hi Sumant: What a background you have--it appears that your "incarnation" is not by accident then.

Clearly, you are a part of the solution--and very practical ones I may add.

I know there are increases in wind turbines sprouting up all over the western U.S.--but it is interesting to hear from someone who was/is on the groundfloor of implementing these alternatives in countries such as India.

I have the strange sensation that the whole "oil storm" is being manipulated in ways that will get everybody to go trade their new SUV's in at a panic price--trade them for hybrid's made by "apparently" competing auto manufacturers--or at least in Toyota's new U.S. maufacturing plants, as an example....

....through this nation, if not many of the wealthier first-world nations into an energy crisis this winter, appear to solve the problems by spring or summer, sell the SUV's back to everybody again....and on-and-on.

Why would these American car manufacturers make all these high-powered Dodge Chargers etc., with the knowledge they have about our true oil reserves.

From your background then, are you sensing that this whole energy mess is manipulated to some degree? I feel that overall, we will be forced (for our own good in the long run), to open up cold-fusion once and for all.

Fission isn't nearly as capable and much more destructive (by it's inherent nature of breaking apart--vs. fusing together) than the endless and unlimited energy we would have just form making "cold-fusion" viable--which I think it actually is, much more than we are being shown.

That is the problem with "fusion," it would make obsolete the entire infrastructure of our power grids, oil and trasport systems, enviormental impacts, etc. We wouldn't know how to suddenly shift to having little or no energy struggles, and the vast industries that surround having "those problems."

Nor does "cold-fusion" diminish the many applications, particularly on an individual basis--such as home heating (or supplemental heating/cooling), at least from trasnferring reliance from oil/coal etc.--to resources like wind/solar, or George Bush's ranch has--geothermal.

What do "you see on that event-horizon?" You are much closer and more knowledgeable to virutally all of us--regarding the realities of such applications.

How much are our governments blocking these applications in order to cater to multi-nationals short-term interests and controls???

Thanks for bringing this one on! Dave

Stephen: You know I love your insights and well-founded and well-researched sources, but....we aren't in the same game as the 1970's....are we???

Give or take--we have twice as many people on the planet, have used up and are now dependant on vast quantities of oil reserves that are no longer there (it takes how long for nature to make us an oil reserve???), with many times more energy requirements per-capitia (Simran's Footprints), with China "on board" for massive numbers of cars, highways, as well as all other nations "needing/demanding" same.

China isn't the only one shopping for the big oil giants. Whether we run out of oil, as we know it, in 10 years or 30 years--it is still the same short-range insanity to think we can keep going with the American lifestyle in the "for-seeable" future--N'est Pas??? Dave

There is some supply demand issue here obviously, but the main problem is monetary. New technologies are finding more and more oil, and more efficiently. The chairman of Exxon was on CNBC a while back and he said he didn't get it, he said supply was not a problem at all, that they are finding more and more. Of course fossil fuels aren't endless, but we haven't even scratched the surface. My prediction is that we will have more in 30 years than we do now, but that probably in 30 years our cars will run on something else. I really believe the powers that be use these monetary manipulations to keep themselves in power. For instance in the great deflation of the late nineties, when oil was $10, it forced many of the upstart telecoms, who were threatening the Bells, into bankrupties, because the dollars they had to pay back on their debt were more expensive dollars than the ones they had burrowed. The telecom act of 96 also drove a stake into their collective hearts. Then the establisment had the nerve to say it was the bankruptcies that caused the Crash of 2000, instead of their policies that caused the bankruptcies. The establishment causes the problems, then they create scapegoats for the public to turn their energies on. The same can be said for the foreign policies. The result is that the public loses, in standards of living, because for instance the U.S. is now 10th in broadband and the broadband isn't even broadband.

Stephen: You make conspiracy-theorists look very practical and down to earth!

I look forward to watching what-in-God's-name (so-to-speak!) Spirit (so-to-speak!) is going to do with a mind like yours, for this world's most needed key-pieces.

What I mean with that is the notion that your mind has that capacity to take a 10,000 piece jigsaw puzzle and "see" not only how it fits together, but which pieces go where by what is missing from view--not what piece is "in view."

No wonder you still feel "out-of-place," the world has quite yet caught up to your place in time--but it is coming up fast and will sweep you into it's 'slip-stream' in the blink-of-an-eye! Dave

I believe the actions we take today will effect our future.

How about if Bush brings the war-jets and the tanks back from Iraq and just parks them on his vacation ranch in Texas? That would save a little bit of gas. Patzi

Just curious, Sumant. How many MPG does your car get? :)

I often wonder: what is so great about Hybrid SUVs? Rich gas guzzlers trying to make themselves feel better for driving monsterous cars?

David -- I think your question: "Why would these American car manufacturers make all these high-powered Dodge Chargers etc., with the knowledge they have about our true oil reserves." can be answered in one word: Capitolism.

Wow Dave, I haven't had a compliment like that, in well, forever! Unless I had one in a previous life, hehehehehehehe. I really appreciate it, that makes me feel soooooo good! From the bottom of my heart, thank you!!! You're the King of this Board, except for, of course, The Great Being, heheheheheheheheheh

Well the truth is there is no shortage of energy, it is everywhere that is what the universe is.

A cheap energy device that would be introduced is a national security threat. We could not possibly convert an economic system based on oil to another in less than 30 years.

Say tomorrow I mail the design for an energy device to 170 universities around the world. Like a gift to the world.

The systems could collapse just knowing of the potential. So I won't do that :). If I try to patent the device in the US they can lock it down and control it if they deem it of sensitive nature. So I can't do that. So does that mean I patent it in India first or in dozens of countries concurrently? By the way, it doesn't produce energy. it captures stores and concentrates efficiently the "free" flowing energy. Was conceived 20 years ago, but only came possible 5 years ago because science discover how to make the missing component.

I think we are in the middle of WWIII. It is an economic war rather than armies. Did you know Saddam was threatening to sell Oil in Euros? Never heard it mentioned in the general media here. Now China is in that same position to play economic games. They could sell in the Euro. The one question that will transform the world is "how is money created" who owns the creation process? 99.999% of people cannot answer that question surprisingly not even bankers and CPA's.

The other thing is that who controls the value of the dollar or any other currency? Why is the British pound the most costly currency? Who do you think is really running the show? Questions open the doors which let the light shine through.

There are big chess games being played. I think though in some ways it is becoming so complex that the players are having trouble knowing what moves to make. This is good because an autonomous system takes Ego out of the picture.

Economists are saying economics have become a mystery because of the globalization, mostly probably because one mind has a problem grasping all the components.

I think many were caught by surprise by the increase in demand created by other countries.

Domestic oil producers are very much benefiting from the high price per barrel. Funny isn’t it we go into Iraq and more or less control the oil but there is a shortage.

Did we really go in to limit the supply? Texas does well because of it. Several years back there was an inquiry into Oil from the Alaskan pipeline, which taxpayers built being exported to the Japanese to prop up prices in the US.

So it sounds manipulated to me.

Heck if you can stage a terrorist attack or create the appearance of an eminent threat and know in advance you can make two or three billion dollars. So say you are the Saudis you can make more money manipulating the market then you can selling oil. Anyone that makes money without making an actual contribution to the economic system, it stealing from the producers.

We need to create a "new system of things" to replace the "current system of things".

There is a small percentage of people that benefit from the current systems. The majority do not, or it could be better. This minority that currently benefits strives to keep things from changining.

We need to transfer power, to the citizens (take our power back), and we can, now that the technology to do so is in place, The few can be corrupted and the many cannot.

So back to energy what do you think of this.

in the US Hybrids are being bought and then modified by the purchaser to be plugins. They can plug into the electrical outlet. They then get about 80 miles per gallon factoring the cost of the cheap electricity. Question is why do the hybrid car makers not sell this feature on the car?

Is there some deal with the Oil companies?

I don't know. But I think it is a good question.

Manfred Max Need is a chilean economist, (alternative nobel prize) that has explored theses themes. In fact, he created a new holist measure named "ecozon" (instead of money)that captures the energy consume.

In this direction you will find this indicator and other interesant aspects:

http://formambiente.org/isa/Sezioni/Materiali/Indicatori.pdf

Greetings Sumant

Your thread on energy issues caught my eye because here in the UK, climate campaigners were recently outraged as a seriously good wind farm plan was axed by Blair's government.

The Guardian reported on 3rd March:

" The energy minister, Malcolm Wicks, and rural affairs minister Jim Knight said they had accepted an inspector's conclusions that the need to protect the landscape outweighed the benefits of securing a source of renewable energy".

http://www.guardian.co.uk/country/article/0,,1722614,00.html

The laws of economics will never solve our world energy crisis, nor can we just sow seeds now and hope things will work out in the future.

We need an alliance of influential world leaders and public figures willing to donate a massive amount of money to the solution. Choose the donors from a short list of the richest in the world. How much they give has to be so dramatic that everyone will think them mad: ie Bill Gates gives say at least 3/4 of his fortune, not just the odd billion.

This, Sumant, is where people like you and Deepak Chopra come in - highly skilled networkers with a profound connection to spiritual values, your success in the material world will give you the credibility to persuade these donors not to fear losing so much money. Help them understand the Law of Abundance so that they choose to give without attachment to the outcome. They need to feel in their bone marrow that this is the necessary and right thing to do at this point in time, before global warming roasts us all.

If a few key people at the top were to do this, I think we would see a quantum shift in consciousness among the tiers of wealth below, trickling finally downward until it became an action of our time that many people imitated.

Adam G

It's good to see entrepreneurs/VCs thinking about the energy issue. I know Vinod Khosla has an interest in ethanol these days.

This is worth getting worked up over, and the laws of economics will not solve the problem.

1) Yes, there will likely be a collapse due to the Peak of world oil production. I don't know if it happens this year or in five. And it could be delayed by a demand shock due to avian flu or something along those lines. I'll refer interested readers to the 1988 book by Joseph Tainter for more thoughts on collapse. My own feeling is that Peak may have already happened or maybe within the next 2 years. (Peak already hit for light sweet crude, past tense, full stop. The question is what happens with lower grade oil and what kind of flow rates do we see with unconvential oil plays.)

2) This time things are very different from the 1970s. Back then the problems were political and this time they are geological. Refer to recent news articles about some of the world's most prolific oil fields (Cantarell in Mexico and Burgan in Kuwait) going into decline. No amount of coaxing or coercion will work, you can't reason with an oil well or even bribe it.

3) The notion that high prices will restrain consumption are wrong. Think about the last time that oil prices increased dramatically: between 1969 and 1978, oil prices went up 14-fold, yet worldwide oil demand went *up* from 45 million barrels a day to 65 mb/d. So much for using less energy as price goes up. The only thing that will force us to use less energy is if production plateaus -- and if price is the rationing factor, the Goldman Sachs $105/barrel projection might look to be a bit low.

4) Technology and alternative energy sources will not rescue us. Better technology did not reverse the course of the US oil production decline since the early 1970s. Just as the US peaked, so will the world, and technology is not the magic bullet. It's a bit late to focus on alt-energy since we could double alt-energy, double it again, and again, and it would still be a drop in the bucket. These things take decades to transition to, and the time to start was about 1970.

Think about this: a hybrid auto uses about 3 times as much copper as a conventional auto, because of the batteries, etc. But not only do we have supply/demand problems with oil, we have them with other commodities like copper, silver, uranium, and the list goes on. I think the world has about a 3 week inventory of copper on hand, for instance. So the question is: transition to what? This is a classic overly constrained case with no easy solution.

For those of you that are really interested in this issue, here are some books I found very useful:

"Twilight in the Desert" by Matthew Simmons
"The Party's Over" by Richard Heinberg
"Hubbert's Peak" by Kenneth Deffeyes
"The Collapse of Complex Societies" by Joseph Tainter
"Petrodollar Warfare" by William Clark

For those of you that haven't already Googled "M. King Hubbert" that would be a good basic starting point without having to order anything from Amazon...

-Mike

PS did were you aware that about 20% of US energy production is still offline as a result of the 2005 hurricane season, and the 2006 season begins in about two months?