My motivation is FEAR. I mentioned that I have been writing on the coming economic collapse since 2007.
I read everybody and settled in with those who have a long track history of being correct. I have been writing diligently to try to warn people. I would be remiss in my responsibilities to my fellow Earthmen if I didn't warn them. I have 2900 posts at the Energetic forum and a few hundred previous posts at Burning Man.
You can imagine that with 3,000 posts on the economy, I could get carried away with long, drawn out details.
i'll try to keep it brief. If anyone wants any references, I'll be happy to oblige.
The story starts with King Hubbert. He projected Hubbert's Peak long before fracking and deep-well drilling. Some years ago, the price of oil peaked up over $100 a Bbl. The high-yield bond market (junk bonds) was drawn into financing facking.
Things were OK as long as the price of oil stayed high. Automation and outsourcing took away most of the discretionary spending of the middle class. We cut way back on energy consumption. The oil producers lost margin and tried to make up for it with volume. We keep setting new records of oil-in-storage. As they all pump, the price stays disasterously low. Most oil producers have huge social costs attached to the FORMER high price of oil.
The IMF says that Saudi Arabia will be completely broke in 3 years. Venezuela is already completely broke. Venezuela has the largest reserves.
Oil is currently about $ 43 for a 42 gallon barrel.
6/14 Oil at 7-month low of $44.73 on spike in US gasoline stockpiles – CNBC The consumer is busted.
102 million working age Americans do not currently have a job. This
includes the 95 million Americans not counted by the Bureau of Labor
because they assume these people have been unemployed so long they “do
not want to work"
As if falling demand and consumption isn't bad enough, there are other huge problems,
6/17 Forget coal, solar will soon be cheaper than natural gas power – Think Progress
6/15 Wind, solar surpass 10 percent of power production – Chron
6/20 Oil tanker storage hits a 2017 record despite OPEC’s cuts – Bloomberg
6/20 Oil slips to seven-month low on signs global glut will persist – Bloomberg
6/22 Oil drops to 10-month low; biggest first-half slide in 20 years – Reuters
BUT, don't forget, the drilling was financed by the junk-bond market.
The oil majors are no longer profitable. They spend too much for debt service. EXXON earns 5.5 cents per gallon for finished product. The State grabs about 70 cents on average for each gallon. California grabs much more because it is more broke.
Nuke power has to be heavily subsidised in New York. Coal is going bust. If wind and solar can beat even natural gas, the whole carbon industry will have to cut way back.
The futures markets say that oil isn't going up for years. The oil industry will have to go through bankruptcy. I don't really expect this bankruptcy to be orderly. This isn't something new.
"Hundreds of banks were forced to shut down in Texas when the state fell
into a recession in 1986 during a steep decline in oil prices."
The oil majors will have to default and be reorganized. The fallout on the banks will be huge.
Here is the break-even oil price for 14 countries. https://knoema.com/vyronoe/cost-of-oil-production-by-country
So, it won't be just Western banks and Western oil companies.
I don't have great faith in the legislature to manage these problems.