Mike K

Time to Short Both Long-Term Bonds and Crude

Peak oil is a misnomer. The theory should be relabeled "Peak oil at marginal cost of $10/barrel." With that considered, we have tons of oil recoverable at higher marginal costs ($60-100/barrel), still profitable for producers. Now that demand is falling, it kind of undoes the urgency of peak oil, don't you think? The stock markets' behaviors concerning this oil move are signalling that the price of oil will input to collapse economies, thus further invalidating peak oil's significance.

I'm all for getting off oil entirely. With a massive nuclear power plant buildout (and mass production of nuclear facilities) we could achieve an all-electric transportation infrastructure making peak oil worries a thing of the past. Then comes CO2 sequestration to algae ponds from coal production to create more liquids (and double coal's burning efficiency, reducing emissions). Then comes room to destroy a ridiculous ethanol subsidy policy and even possibly *tax* biofue producers for the use of corn and soybean for other than food purposes - this will fix food inflation. All without central banks hiking rates.

The middle east exporters will have trouble selling their 'black gold' for $15/barrel when that happens.

Too bad nobody is listening.