Peak Oil in America?

Published: Fri, 12/05/14


Richardcyoung.com Incite-full
 

In This Issue:

Derangement at the EPA By Debbie Young
Grand Cru Burgundy and Vialis Chateau Laguiole By Richard C. Young
Immigration Humpty Dumpty By Debbie Young
Ike, the Most Successful U.S. President? By Richard C. Young
Your Tropical Key West Vacation By Richard C. Young
Peak Oil in America?  By Richard C. Young

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Peak Oil in America?
 
Dave Hammer

Yes! During my 14-year run in the institutional research and trading business in Boston, the finest analyst with whom I worked was oil analyst Dave Hammer (pictured to the right). Since 1990 Dave has been the managing partner of Hammer Asset Management. We stay in touch to this day. Yesterday I asked Dave about my concern that shale production could soon be peaking in America.

Here’s Dave’s reply: “Bakken and Three Forks are beginning to peak. Current annual increase in production now equals the monthly increase of two years ago. Production will peak in 2020 assuming $70-$100/bbl. oil. The good thing is that the decline rate is slow. In 2060 ND shale will still be producing more than 50% of its 2020 one-million bbl./day peak.”

Bakken-Map

A map of the Bakken and Three Forks Formations within the Williston Basin of North Dakota, Montana, and South Dakota Source: USGS

 

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Derangement at the EPA
 

After “investing” tens of billions of taxpayer dollars of federal subsidies for Solyndra, Fisker Auto, battery plants and other mega-green energy losers, the U.S. still gets only about 3 percent of its electric power from wind and solar power. Stephen Moore, along with Kathleen Hartnett-White, write in the Washington Times, that if you think President Obama’s unilateral exercise of granting amnesty to illegal immigrants was an abuse of power, you should read here what the Obama administration is doing at the Environmental Protection Agency. Proposed Clean Power Plan regulations from the EPA are “the most expansive and economically disruptive rules in four decades.”

The EPA’s rule aims to reduce carbon-dioxide emissions from U.S. power plants by 30 percent. That’s an enormous and costly burden on our power generating utilities. According to Energy Ventures Analysis, an energy research firm, the annual costs for residential, commercial and industrial energy customers in America would be about $173 billion higher in 2020 — a 37 percent increase. Average annual household gas and power bills would increase by $680 or 35 percent.

However, the overall reductions in the planetary volume of carbon-dioxide emissions would be microscopic — like trying to reduce the rise of the oceans with a syringe. The United Nations Intergovernmental Panel on Climate Change’s own official number crunchers say that we must reduce global carbon-dioxide emissions by 80 percent over the next several decades to avert catastrophic warming. The EPA’s proposed cut would yield an immeasurable 0.018 degree Celsius cooling.

This is going to save the planet from catastrophe? Good luck.

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Grand Cru Burgundy and Vialis Chateau Laguiole
 

chateau laguiole versailles series thuya handleThis past October, Debbie and I were in Beaune, France, the Burgundy capital of the world, to research and buy Grand Cru Burgundy from Gevrey Chambertin, Chambolle-Musigny, and Vosne-Romanee. With my heavily red-pen underlined and warn copy of The Professional Wine Refference  in hand, I was on a mission to secure a select Grand Cru list. And I knew from past visits to Beaune just the shop down the street from our favored Hotel Beaune to ask. In shockingly short order I was able to fill my complete Grand Cru checklist and arrange to have it all shipped back to America, once the weather cooled, which is vital. And to my astonishment I was able to purchase one bottle of the shops three bottle annual allotment of a special vintage of Leflaive (not Faively) Puligny-Montrachet. With this home-run experience, I could hardly believe my good fortune.

Obtaining excellent vintage Grand Cru locally in America is no easy task. For example, I recently spent an hour going through the wine racks at Beacon Hill’s three wine shops. Not a single bottle of Grand Cru Burgundy on the racks regardless of the vintage or grower. And if you know Boston, you are aware that Beacon Hill is a prestigious, pricy enclave.

Scroll forward to my birthday just a few days ago. For years I have been fiddling around with and cursing my different wine openers, from cheap plastic ones to (awkward metal ones). Well no more. Debbie surprised me with an authentic Vialis Chateau Laguiole (lah-yole) hand-made, stainless steel and Thuya wood French wine opener. The specimen wood was originally imported to Versailles during the 18th century. All the Vialis Creation Chateau Laguiole openers come in a customized blue leather pouch with a certificate of authenticity. Both the blue leather pouch and the Chateau Laguiole feature the historic stamped metal bee. And the boot lever is stamped with the famous fleur-de-lys (armorial emblem of the kings of France). All production is done in the south of France in Thiers. Knockoffs abound, so purchase your Vialis Chateau Laguiole employing all of the safeguard features I have outlined for you here.

Any one you know who loves fine wine (hopefully French Burgundy) will thank you profusely for yanking them from the misery of cheap plastic (frustrating) openers a la Dick Young. What a great Christmas gift, even if you are unable to accompany your gift with a bottle of Grand Cru Gevrey Chambertin from your local wine shop.

Merry Christmas,

Dick and Debbie


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Immigration Humpty Dumpty
 

king-obama3As Cato Institute’s Ilya Shapiro (senior fellow in constitutional studies) points out, the U.S. immigration system “serves nobody’s interests—not big business or small, not skilled or unskilled workers, not the economic or national security.” And while there’s plenty of blame to land squarely on the shoulders of Congress for not fixing our immigration mess, nothing justifies what President Obama is doing, especially given that any hope for real, legislated immigration reform has been shattered.

Ironically, Barack Obama—who in 2007 as senator voted against the guest-worker program—argued no less than 22 times that POTUS cannot do what Mr. Obama just announced he is going to do. Read more here on why Ilya. Shapiro thinks Mr. Obama has set a dangerous precedent for executive action—“one in which the president somehow gets more power when Congress isn’t acting.”

To be sure, the relevant statutes give executive branch officials very broad discretion in how they enforce immigration laws. For example, Section 212(d)(5)(A) gives the Secretary of Homeland Security the “case-by-case” discretion to “parole” for “urgent humanitarian reasons or significant public benefit” an alien applying for admission. The authorization for “deferred action”—a decision not to seek deportation and concomittant authorization to reside and work legally, which was the basis for Obama’s 2012 Deferred Action for Childhood Arrivals program—is similarly broad.

And all modern presidents, from both parties, have used such discretionary powers. President Ronald Reagan’s Justice Department issued regulations to comport with the family-unity provisions of the 1986 Immigration Reform and Control Act. President George H.W. Bush temporarily expanded the category of undocumented children and spouses eligible to stay in the country before Congress formalized their status. President Bill Clinton deferred action on illegal immigrants from Haiti during that country’s convulsions in the 1990s—one example of many relating to executive discretion regarding nationals of war-torn nations—while President George W. Bush took various actions regarding illegal aliens in areas affected by Hurricane Katrina. These are just a few examples, but they’re all different from what President Obama is doing, both qualitatively—discrete and temporary versus open-ended and potentially timeless—and quantitatively. (See here and here for contrasts between Reagan/Bush and Obama.)

But don’t take it from me. Here are a few solid arguments that were made by a noted constitutional lawyer over the last several years:

  • “Comprehensive reform, that’s how we’re going to solve this problem…. Anybody who tells you it’s going to be easy or that [the president] can wave a magic wand and make it happen hasn’t been paying attention to how this town works.” (March 10, 2010)
  • “America is a nation of laws, which means [the President is] obligated to enforce the law…. With respect to the notion that [the president] can just suspend deportations through executive order, that’s just not the case, because there are laws on the books that Congress has passed…. [W]e’ve got three branches of government. Congress passes the law. The executive branch’s job is to enforce and implement those laws. And then the judiciary has to interpret the laws. There are enough laws on the books by Congress that are very clear in terms of how we have to enforce our immigration system that for me to simply through executive order ignore those congressional mandates would not conform with [Obama’s] appropriate role as President.” (March 28, 2011)
  • “If this was an issue that [the president] could do unilaterally, [Obama] would have done it a long time ago…. The way our system works is Congress has to pass legislation. [The president] then get[s] an opportunity to sign it and implement it.” (Jan. 30, 2013)

These are but three examples of the 22 times that this particular analyst of executive power has argued that the president can’t do what he just announced. Who is this person with such strong feelings that he’s felt the need to opine so many times on this? Barack Obama.

 

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Ike, the Most Successful U.S. President?
 

In his 1983 book Modern Times , Paul Johnson wrote, “Eisenhower was the most successful of America’s twentieth-century presidents, and the decade when he ruled (1953-61) the most prosperous in American, and indeed world, history.”

Here at taki.com, John Derbyshire remembers the above and writes about Ike, “America’s prosperity glows golden in the memory of us who witnessed it.” In his review of the soon-to-be-released Ike The Ringer, Derbyshire writes, “This was our best modern president.” Derbyshire recommends Paul Johnson’s Eisenhower: A Life for further reading on Ike.

I’m in agreement with John, and I would include Coolidge and Reagan on my very short list of excellent modern presidents. On the flip side of the coin is my list of the most destructive modern Presidents. In order of destructive force are Wilson, FDR, Obama, Johnson, Carter, and George W. Bush.

I cannot help but wondering what General Eisenhower would think, were he alive today, about the mindset of his fellow Americans who would have voted into the White House a president with a conflicted background, to say the least, and a postcard-thin presidential résumé. A presidential résumé, in fact, showing blanks for military background, management and organizational skills, as well as for business acumen. How was such a totally unqualified person elected not once but twice as president of the most important country in the world?

Barack Obama ranks as easily the most unqualified, elected modern president. Obama has proven, in his unfortunate six years in office, to be even more destructive and divisive than Johnson or Carter, a low bar indeed.

Now Americans have less than two years to figure out how to right the ship. I am not optimistic. The Republican Party, as configured today, is structured to promote the military industrial complex, built on a foundation of the military and Fortune 500 companies (fronted by Wall Street and the oil industry). “We the people” are not in the mix and virtually out of the picture in terms of influence. To think otherwise is simply naïve, especially where one is apt to raise a weak hand in support of the disjointed Tea Party movement. As for the Democrats, Hillary Clinton? Really?

The Cato Institute is America’s small-government, non-intervention beacon. Debbie and I are significant backers of Cato’s ongoing research to support a true American constitutional Federal Republic as intended by the Founders. It is, then today, left to state governors and small government members of the House to form a bulwark against both the Republican and Democrat statists. I count but a small (single digit) number of senators who are not bought and paid for by “the complex.”

Governors and sheriffs (a lot of constitutional power) have it in their power to strike back at federal operatives on all levels. It is a question of resolve, backbone and local support, state by state. I would think that business friendly, low-tax states (Wyoming, Nevada, South Dakota, Texas and Florida) could lead the way by drawing business and residents away from high-tax, unfriendly to business, anti-gun states (California, Illinois, New York, New Jersey and Massachusetts). The road ahead is steeply uphill for small government, states-rights-oriented Americans. It remains to be seen if an Eisenhower-type leader emerges to lead the way.

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Your Tropical Key West Vacation
 

the soul of key westDebbie and I first landed in Key West nearly 25 years ago. Aside from the great tropical—well actually sub tropical—weather and one-of-a-kind conch cottages, and oh yes, stone crabs, we have thought that the island music was the best part of living in the Keys. After all these years, it was not until yesterday at Blue Heaven that I found a book that really captures the Key West music scene.

If you have been to Key West in the past, you will be excited to see all your old favorites like Barry Cudda and Key West’s “king of soul” Robert Albury come to life in the pages of The Soul of Key West. Debbie and I have known Cudda since we first arrived. Barry led Becky’s wedding band at the Casa Marina. And Debbie and I were in the house at the legendary Bo’s Fish Wagon on Caroline Street when Barry first rolled (yup) his standup piano down William Street and into the fish shack for a night of New Orleans rhythm and blues. Barry is still at BO’s most every Friday night and often joined by our old Key West friend Chief Billy on bass. Billy was also part of Becky and E.J.’s Key West wedding’s musical contingent. Now that I think back to those early days in the Keys, I remember that, at our conch cottage right up the street from BO’s, I helped Barry fill out his first IRA forms. Unbelievable.

For many years soul man Robert Albury peddled his bike, while singing Motown songs, right past our house, just down the street from BO’s. The feature in The Soul of Key West truly captures the sprit of this terrific guy and our best Key West resident soul man. Whether you are now making your plans for your first island visit, returning as a seasoned salt water conch, or simply enjoying another great time of the year as a Key West resident, The Soul of Key West will brighten your time and help make you feel that you are living in Key West like a local. And maybe Debbie and I will even run into you catching some island music.

The only way to order your personal (also great for gifts) copy of the Soul of Key West is to call my friend, the manager of the Blue Heaven island store, Paula Keatley at 305-296-8666. You will be so glad you did. And just in time for Christmas no less. I hope you will love your “slice of Key West’ musical adventure book and that it will bring back many old memories for you and your family or will simply help build your excitement for your first Key West island vacation. Enjoy!

 

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