Actually, there is some logic to that argument.
As long as inflation rate is positive you are paying off old debt with new money that is growing faster than your debt.

High inflation rates benefit people with debt.
Deflation benefits people holding cash.

That is how governments and business operate.
(btw, I don't buy into that model.)

Benjamin Franklin made the same observation! He even had the temerity to write about it. Of course, his perspective was from the government's side. That is, borrow money, then pay it back with depreciated dollars. That is the door to a political debate I feel we best avoid. Of course, he lived in a time without electronic, global markets. The world is watching Greece to see what the end game will be. American stocks did not do well today, if that is any indicator.

I don't buy into the model either.

John

 

Actually, there is some logic to that argument.

Unfortunately, the "logical" people left one or two foreclosed houses on every block in my neighborhood. Only us old farts (that know what hardship is) still have homes. Rent for a similar house is now 3 to 4 times what my house payment was. It makes me wonder how those people that couldn't pay the mortgage can afford to pay rent.

 

It makes me wonder how those people that couldn't pay the mortgage can afford to pay rent.

It is very hard and expensive to evict residential tenants who don't pay their rent. Many landlords realize that and accept what they can get. Corporate landlords with in-house attorneys are not so generous. So, we see the little guy getting out and the big guys (sometimes known as slum lords) moving into the market. The whole neighborhood suffers.

John

 

Speaking of rent I wonder how things will play out locally if we have 50 - 100K people all packing up and leaving our state in the next few weeks.

Ouch thats gonna hurt the locals that have been banking on their overpriced rent fees not going away any time soon.

 

Sorry to hear about the job tcmtech.
Gotta hand it to you guys. You put a cap on the price.

 

Yes, sorry to hear about the lay off, hope you get sorted soon and thanks for the sensible, real world updates on fracking practice I really appreciate them.

 

I second Sirch2's comments. Best wishes, Tcmtech.

 

Joining the, "Thank You" squad.

Number Twelve

 

The press had this right all along, that prices in the 45 - 50 dollar range would make it unprofitable to drill domestic wells. This correlates to what friends of mine in the industry in Houston have been telling me. They work for oil field service companies who are laying off thousands of employees and consolidating and merging companies. Another interesting thing I've learned is the cost depended, among other things, the location within the field being drilled. In one article, operators at the edge of the field, where oil was less plentiful, had to have the price upwards of $70/barrel to make a profit, whereas the required price was lower in in the interior parts. Prices are bittersweet, good for consumers but not so much for producers.

 

The press had this right all along, that prices in the 45 - 50 dollar range would make it unprofitable to drill domestic wells. This correlates to what friends of mine in the industry in Houston have been telling me. They work for oil field service companies who are laying off thousands of employees and consolidating and merging companies. Another interesting thing I've learned is the cost depended, among other things, the location within the field being drilled. In one article, operators at the edge of the field, where oil was less plentiful, had to have the price upwards of $70/barrel to make a profit, whereas the required price was lower in in the interior parts. Prices are bittersweet, good for consumers but not so much for producers.

This is called, in economic terms, "creative destruction" -- in this case, brought about by the success of the fracking industry. The short term effects will be layoffs, consolidation, and mergers -- painful for many. The long term effects will be greater efficiencies, higher productivity, and lower costs -- beneficial to all of us.

 

Maybe, but it depends on how the mergers play out. I think there is the same chance the resulting companies become bloated and inefficient, and the smaller more agile companies would have better served.

 

Maybe, but it depends on how the mergers play out. I think there is the same chance the resulting companies become bloated and inefficient, and the smaller more agile companies would have better served.

I don't doubt this. And then, smaller, smarter, and more agile companies will come in and eat their lunch. And they will then be merged/consolidated.

Wash, rinse, repeat.

Capitalism at it's finest. Seriously.

 

It breaks my heart to see them burning enough gas to heat a big city. I know we have lots of gas but if they could get that to market it might help the bottom line.

 

Not feeling too bad about loosing the job to be honest. Slept in till noon today.

Besides I played this game for profit and personal gain so I honestly as things look for me at this point I have no real need to find any form of work for a long time now.

I almost pretended to work for 9 months so now I need at least a 6 - 9 month vacation to recover from all that effort I almost put out.

As for many others I worked with I know this hit them hard but to be honest I didn't see a single one of them being forced to live and burn through their money they way they did so their problems are mostly self inflicted.

Sort of thinking I may have to help a few guys out and buy their fully loaded 5th wheel camper and brand new four wheeler off them at darn near insulting prices.

 

Now relating to the shutting down less of that had to do with the overall cost to pump here but our present bottle neck on getting the oil and gas out of state. That and the fact our greedy village idiot tribal leader screwed the construction and likely the immediate future possibilities of having new larger refineries built locally on the reservations.

The local numbers on our oil production put the average break even on our oil at around $28 a Bbl with a good percentage our wells that are profitable well under that. The transportation bottleneck is our main stumbling block here. If we had the primary proposed pipelines in place and the local pipeline networks finished I doubt the oil industry in this region would have blinked until world prices hit around $30 a Bbl.

Personally I won't be surprised if the majority of the support industry and local infrastructure works will slow down by any great amounts. If anything now will be a good time to get more of it done being we should have a sudden surplus of labor hitting the market now and a large drop in overall traffic and the like that has been a measurable impedance to infrastructure work here so far.

Then again who knows.... Maybe by next summer the whole state will be abandoned and I will be buying up neighbors farms for $10 an acre.

 

Not entirely relevant to the instant subtopic of this topic:

 

Not entirely relevant to the instant subtopic of this topic:

The character (as opposed to the actress playing the character) is the exact type of know-it-all that gives women a bad name in the business world.

And the fact that the whole notion of peak oil is a bunch of crap isn't news.

I guess I am cranky today, huh?

 

The character (as opposed to the actress playing the character) is the exact type of know-it-all that gives women a bad name in the business world.

So....

...Women can't be "know-it-alls" but men can? Perhaps she should just get back in the kitchen where she belongs, hmmmm?

 

So....

...Women can't be "know-it-alls" but men can? Perhaps she should just get back in the kitchen where she belongs, hmmmm?

No, the best chefs are men as well.

 

Since you liked her so much, here she is again: