Sign up | Login with →

Posts by Gail Tverberg Subscribe

Deflationary Collapse Ahead?

Both the stock market and oil prices have been plunging. Is this “just another cycle,” or is it something much worse? I think it is something much worse.Back in January, I wrote a post called Oil and the Economy: Where are We Headed in ...

Posted August 28, 2015    

How Economic Growth Fails

We all know generally how today’s economy works:Figure 1Our economy is a networked system. I have illustrated it as being similar to a child’s building toy. Ever-larger structures can be built by adding more businesses and consumers, and by using...

Posted August 11, 2015    

Nine Reasons Why Low Oil Prices May "Morph" Into Something Much Worse

Why are commodity prices, including oil prices, lagging? Ultimately, the question comes back to, “Why isn’t the world economy making very many of the end products that use these commodities?” If workers were getting rich enough to buy new homes...

Posted July 24, 2015    

What Greece, Cyprus, and Puerto Rico Have in Common

We all know one thing that Greece, Cyprus, and Puerto Rico have in common–severe financial problems. There is something else that they have in common–a high proportion of their energy use is from oil. Figure 1 shows the ratio of oil use to energy...

Posted July 9, 2015    

BP Data Suggests We Are Reaching Peak Energy Demand

Some people talk about peak energy (or oil) supply. They expect high prices and more demand than supply. Other people talk about energy demand hitting a peak many years from now, perhaps when most of us have electric cars.Neither of these views...

Posted June 24, 2015    

Why EIA, IEA, and BP Oil Forecasts are Too High

When forecasting how much oil will be available in future years, a standard approach seems to be the following:Figure out how much GDP growth the researcher hopes to have in the future.“Work backward” to see how much oil is needed, based on how much...

Posted June 12, 2015    

Why We Have an Oversupply of Almost Everything, From Oil to Labor to Capital

The Wall Street Journal recently ran an article called, Glut of Capital and Labor Challenge Policy Makers: Global oversupply extends beyond commodities, elevating deflation risk. To me, this is a very serious issue, quite likely signaling that we...

Posted May 9, 2015    

Overview of Our Energy Modeling Problem

We live in a world with limits, yet our economy needs growth. How can we expect this scenario to play out? My view is that this problem will play out as a fairly near-term financial problem, with low oil prices leading to a fall in oil production....

Posted May 2, 2015    

Putting the Real Story of Energy and the Economy Together

What is the real story of energy and the economy? We hear two predominant energy stories. One is the story economists tell: The economy can grow forever; energy shortages will have no impact on the economy. We can simply substitute other forms of...

Posted April 17, 2015    

The Oil Glut and Low Prices Reflect an Affordability Problem

For a long time, there has been a belief that the decline in oil supply will come by way of high oil prices. Demand will exceed supply. It seems to me that this view is backward–the decline in supply will come through low oil prices.The oil glut we...

Posted March 13, 2015    

Role of Wages of the Common Worker in Oil Prices, Collapse

In their book Secular Cycles, Peter Turchin and Surgey Nefedof point out the important role falling wages of the common workers played in early collapses. I got to thinking that this might be an issue with our current situation as well, including...

Posted February 27, 2015    

A New Theory of Energy and the Economy, Part 3: The Problem of Debt as We Reach Oil Limits

(This is Part 3 of my series – A New Theory of Energy and the Economy. These are links to Part 1 and Part 2.)Many readers have asked me to explain debt. They also wonder, “Why can’t we just cancel debt and start over?” if we are reaching oil limits...

Posted February 13, 2015