Reality
By Mark A. Goldman
07/05/08 "ICH" -- - These are interesting times. With oil trading above $100/barrel, a larger portion of our national wealth is being spent on the cost of energy.

We are very near or already at what geologists call peak oil. Peak oil is the point at which the maximum rate that oil can be extracted from the earth’s crust can only relentlessly decline from that point forward, due to geological and technological realities. Prior to peak oil it was usually possible to extract as much oil as we needed to meet growing demand while keeping prices relatively low. After peak oil it will be impossible to do that. From now on, oil will become increasingly scarce. The black gold will still be allocated according to price, but as supplies dwindle and prices increase, more and more people will become less affluent, i.e., poorer than they used to be. The age of cheap energy is over. Unfortunately, soon this will be true for all non-renewable resources as well.

This means that our economy, which runs on oil, will not be able to sustain past levels of growth indefinitely, if at all. Pundits on TV are discussing how long it’s going to take before the current recession will turn around and we come out the other side ready for the next round of growth. In my view, this recession is not going to end any time soon and without appropriate leadership it might not end in our lifetimes. The result might easily look like an economy in the middle of a very long slow motion train wreck

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