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Deep Creek Hot Springs

The Moon is Waxing Crescent (7% of Full)


Re: SC69

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May 27, 2008 10:31PM

"Why isn't media sounding the alarm about this?"

For several reasons:

A. Most journalists are simply not aware of the magnitude of the problem

Even in the financial press, most people and institutions are simply not aware of the size or imminence of the problem. Investment banker Adam Cohen explains:

. . . Wall Street and the financial media are made up of human beings that are just no more interested in the Peak Oil issue than most people that you know. In my personal experience working with energy companies on stock and bond offerings during the last three years, I never heard any energy company employee or energy investment banker use the phrase "Peak Oil." The few times I mentioned the phrase privately to bankers, the response was "What’s that?"

. . . no major financial services company or media outlet would long tolerate any voice loudly proclaiming "Peak Oil! The economy is doomed!" because it would be pretty tough to market other investments or advertising alongside that shrill voice. Source
It's worth noting that most of the major mainstream media outlets are owned, in whole or in part, by large energy conglomerates or real estate investors. Some examples include:

NBC, CNBC, and MSNBC are owned by General Electric. Source

CBS is owned by Westinghouse. Source

Fox News is owned in part by the Saudi Holding Company. Source

The L.A. Times is owned by billionaire real-estate mogul Sam Zell.

Most of the advertisements in any issue of the Wall Street Journal, New York Times or Washington Post are for large automobiles, large suburban homes, or high-priced [discretionary] consumer items.

The financial interests of these companies and individuals would be severely impacted should any significant portion of the public come to understand the magnitude of the crisis at hand.

B. The handfull of journalists who are aware can't "go public" without creating a panic and/or losing their jobs:

Once the seriousness of situation is generally acknowledged, a panic will spread on the markets and bring down the entire house of cards even if production hasn't actually peaked. For this reason, the mainstream media cannot discuss this issue without largely whitewashing the dire consequences for the average person. If they told the truth, people would panic and the markets would crash. Market analyst Steven Laguvulin explains:
Should the oil markets themselves begin to 'connect these dots', then all our lives are going to be impacted violently and immediately. This is why you'll never see "Peak Oil" covered by a respected media outlet. As soon as it is recognized that for all practical purposes the situation is upon us, then a viscious "resource grab" will be initiated.

The price of oil in the markets will begin to rise dramatically. This will initiate a circular hedging/hording mentality in large end-users, governments, and multi-nationals. This will then have a myriad of devastating effects, but all average Joe Consumer is going to notice is that the price at the pump will experience a brief and dramatic blip upward, gas lines will form for a short time at the corner-stations, and then suddenly the corner gas-stations will go dry for good.

Gasoline will simply not be available to individual drivers, as precedence is given to heating oil, critical government and commercial uses, public transportation, transport of food and goods, etc. How the situation unfolds after that you can imagine just as well as I can . . .

If this scenario sounds over-dramatic, keep in mind that what I'm talking about is a dawning recognition of something that many analysts have already come to realize: that the "oil grab" is in fact already on. Source
C. The automotive and aviation industries would be destroyed by acknowledging the truth or any large scale mitigation program:

Most of the steps we need to take to deal with this, such as driving less or buying fewer consumer items, would severely hurt large sectors of the US economy. For instance, an aggressive fuel conservation program would lower the demand for new vehicles as people would be driving less, thereby increasing the life of their vehicles. This sounds like a perfectly reasonable and common sense mitigation plan until you realize that approximately one out of every 10 jobs in the US is either directly or indirectly dependent on the manufacture of new automobiles. Source Each job in the automotive industry creates between 2 and 9 jobs in other industries. Source

With automotive giants GM and Ford already on the ropes, any aggressive program of conservation would likely so blunt the demand for new cars that they would be sent sent spiraling into bankruptcy. This would have devastating effects on the domestic economy and would likely lead to the rise of extremists political movements not unlike what happened to Germany in the 1920s when its economy collapsed.

A similar problem exists when it comes to the aviation industry. According to the International Air Transport Association, aviation is a $400 billion dollar industry that indirectly generates $1.3 trillion dollars in economic activity. Source Overall, it accounts for 9% of global GDP. Source Thus any plan to aggressively reduce air travel is likely to produce the same sort of unintended consequences that would be produced by an aggressive plan to reduce automobile travel: severe economic dislocations, followed by massive social unrest...................


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