During the recent hearings on oil prices it was discovered that one of the main culprits is deregulation in the investment markets. Now 401Ks and other portfolios are allowed to buy oil. Apparently this was not always the case. What this does is allow investment houses to compete for oil by driving the price up.

Actually, the same kind of loose regulation is at the root of the mortgage crises. The great weakness of the Republicans love of free markets is that confuse free markets with unregulated markets. Without regulation you get what we are seeing now. Some regulation is good, obviously. In the long run the right kind of regulation helps stabilize the economy.

An excuse me for my libertarian strain is showing but is anyone lost on the fact that the very reason why the airline industry had to deregulated was because the government could not successfully run it. Now we are about to endeavor to place in the hands of government the heathcare system and climate change (cap and trade)regulations thus expanding the size of government that will be required to support these.

Look I am not for subsidies and I think business should have to compete on fair grounds and of course who would not like to get free healthcare (okay or cheaper) and provide for clean air and water but we all know there is no free lunch in Washington. Remember it used to cost crazy dollars to fly from New York to LA before deregulation. Also ever wonder why there is no real access by foriegn airlines to compete here in America?

I am just really concerned that universal heathcare and cap and trade will make things economically worse. That may not be true, but if the government could not run the airlines what makes us think they are capable of successfully running these programs either.

I understand you fears that government doesn't manage things well. The problem is you need some civilizing force to prevent a wild west situation in the businees world which rewards the criminals most of all. Most businesses are only interested in their own welfare, not that of the community at large. They rarely can take the long view, even though their present course of action may mean they fail in the long run.

The reason we needed a New Deal after the great depression is that deregulation of the markets didn't work. A few people got rich. You know the rest of the story. Since then many people have not appreciated the benefits we have enjoyed from the New Deal, taking them for granted. Only when they reforms begin to be dismantled and we have economic disasters as a result, do people start to wonder what's going on.

Personally, I believe that business and the community must have a type of social contract for our country to thrive. People need to realize that we must have a businees friendly environment and we need to allow people to innovate. That means not too high a penalty when the innovators fails. As the other part of the contract businesses need to work with the government and the community to provide a safe and fair working environment to employees.

In a changing world busineeses will be forced to reform, like it or not. We need to have a government which can help businesses transition in a changing world. Sometimes programs which are thought to be too liberal actually would be a great help to busineeses. One example is for the governement to help busineeses provide health care for their employees.

Unfortunately, like most of us, many businesses don't like change because it is expensive up front. The problem is, in a changing world, businesses must change or fail altogether. Pick your poison.

except if we use the technology model and seek those in that industry for real guidance on how they continue to evolve product cycle after product cycle. Technology is not stagnant and business changes constantly and yet they adapt and overcome. Look at Apple, left for dead about twelve years ago. Innovation without strict regulation was the key. Could you imagine if Apple was forbidden to enter the cell phone or communication market and was forced to stay in pcs?
Apple took to investing in new technology years before it became a reality and now reaps the rewards. The great thing is business does change but its government that has not yet evolved to keep pace.

Apparently there are still some large oil reserves in the U.S.
http://www.startribune.com/bus...

http://www.theoildrum.com/node...

Will Bakken ever produce as much as 4.1 billion barrels (= 3,649+500 million barrels), the amount suggested by the USGS estimate? It seems very unlikely. Production so far has been 111 million barrels. If the industry is able to discover several more prolific areas such as the Elm Coulee field in Montana (43 million barrels, or 38% of the Bakken oil recovered to date), it might be possible to increase this recovery to 500 million barrels, or 4.5 times the current production. Is total production of 500 million barrels likely? It's difficult to say. The USGS estimate is vastly higher than this, so much less likely.

If 500 million barrels turns out to be the ultimate recovery, the recovery factor would range from 0.13% to 0.25% of estimated oil in place. This very low percentage recovery of the estimated oil in place is not unreasonable if one considers that many of the more marginal areas of the field are likely to be deemed sub-economic and will never be drilled and produced. Technology improvements that will inevitably be made during an era of high energy prices will undoubtedly render some of this more marginal oil recoverable, but the total recovery is still likely to be low.

The USGS numbers are notable for their apparent certainty of the size of the undiscovered resources. The p5/p95 ratio is one measure of the spread or uncertainty of a probabilistic estimate. The USGS oil numbers show ratios of 1.2 to 1.9, which is quite surprising. These low ratios imply that the USGS is highly confident in their recoverable resource estimates. One would have thought that a 5X or 10X spread in this ratio would be more plausible considering that 85% to 90% of the resources has not yet been discovered. Perhaps when the detailed report is released, the logic behind this narrow range will be revealed. In the mean time, I remain highly skeptical that such a large resource with an unknown variability of fracture density, porosity, and recovery factor, and other factors, can be quantified with such precision.

If we could actually produce 3.6 billion barrels of undiscovered oil forecast at the P50 level by USGS, how much would this equate to? The US uses about 7.6 billion barrels of oil products a year, according to EIA data. This is equivalent to just under six month's US oil use, spread over a very long period, probably 20 years or more. If total production amounts to only 500 million barrels, as I have suggested, this would equate to about 23 days worth of United States oil usage, spread over many, many years.

Bakken is not going to solve our problems by any stretch of the imagination.

Here are more links on the North Dakota oil:
http://www.ndoil.org/content/v...

:)

I guess nobody will be surprised that there is a Bakken Blog out there.  
http://www.bakkenblog.com/

We can return to the Bakken Blog after Obama is sworn in as President to see how it is going out there.

On november 2000, when Bush  stole the election, I bought gas in alexandria va for my car.
It was 89 cents a gallon. I still have the receipt!

to tackle these issues even if Obama is the next president.  I'd hate to create the impression in anyone's mind that come January 20th, the dollar will be on the rebound, the stock market will break new records, and oil will be cheaper.  

The run up in oil will probably come down, but no where close to $20-$30 a barrel.  The days of cheap, easy to pump, easy to process oil are over.  And demand is forecasted to continue to rise.  But you know all these things already Lowell.  It is going to take more than 4 years to transition our transportation sector to some other fuel.  And in the meantime, regular Americans are going to have bare the short term pain.

As to the economy, Congress acts too slow on macroeconomic issues to have much of an impact on the economy in the first year of Obama's presidency.  If the economy is back to normal growth next year, that will not have had anything to do with a new president.  And I have faith will be back in black by next year.  A weak dollar is making us attractive to the world and upping our exports.

The weak dollar will fix itself.  I don't know that it is all that bad though.  If the federal government gets out of the business of crowding out competition in the debt markets and the economy picks up, the dollar will come back.  It will be a true test for Obama on whether he can say no to his own party and balance the budget.  Bush certainly wasn't able to and only found his zeal for controlling spending once Democrats took back both houses in 2006.  

I still can't believe that conservatives didn't crucify Bush over Medicare-D.  For those of you not familiar with Medicare-D, do hear that giant sucking sound?  It is tax dollars being vacuumed from your account to line the pockets of Pfizer, Merck, Eli Lily, Novartis, and drug companies generally.  Ugh!  Our motto should be: America, we pay high drug prices, so that you don't have to.  You being the rest of the world.

or anyone else to clean up the utter mess the Republicans have made the past 8 years.  But one thing's for sure, there's no hope at all if John McSame is elected.  None.

As an independent, I want to express exactly how it is I left the Demcratic Party in the first place and this hits the nail right on the head. Denial over economic impacts.

The President does not hold the purse strings. The Congress does. The Congress impacts the economy through its wielding of legislation and not the President. The President certainly has the power to veto to be sure but friends lets be honest about the fact that Democrats since 2006 have been in a better postion to impact the economy and they have chosen not to. Where has the leadership been?

If you recall, and this gets to why as a fiscal conservative I became an independent was the Democrat controlled Congress throughout the 1980's. These folks nearly spent us into bankruptcy.

It was 1994 with the Contract of America where the first item in the Contract was a "Balanced Budget Amendment"--opposed by Clinton by the way. What ws the first two years of a Democratic Congress with Clinton stock market return:
Dow 7.76%   OTC 4.14 yearly average
After 1994-95 (Republican Congress)
Dow 33.1    OTC 35.2%
After 1995-97 (Republican Congress)
Dow 37.36%  OTC 81.61%

The poster years for how tax cuts work.

So when the Democrats controlled Congress and the WH the Dow returned 7% on average and the OTC returned 4.1% while under Clinton/Gore with a Republican Congress DOW 25% and OTC 35%.

So what does this mean? If you take the 80's and early 90's you will see that the stock market did not fair very well with a Democrat Congress, regardless of what Party held the WH. Why?

The Congress is the central guardian of the economy and its growth through policy and legislation not a President. We somehow always like to put things at the feet of the President when in fact much of the blame has to do with Congress.

We can argue about the Iraq impacts for sure, but it will be Congress that will impact dependence on oil and will impact or not domestic production that could lower the spread on oil and decrease dependence. Without Congressional leadership, it matter little about the Presidents goals.

It was the tax cuts of the mid-90s by a Republican controlled Congress that stimulated economic growth in the mid to late 90"s was it not?

The biggest reason I am still an independent (at national level) is because niether Party has a clue what it means to be fiscally responsible.

If Obama come out with plans to increase taxes to fund programs and not fund them through spending reductions in other bulging programs then the Stock Market will not recover. In the 1980's as a percentage we saw major one day declines as well as just as many 300 pt declines in the early 90's as we have know. The difference the market is quite larger today and the % decline is quite different. The points may be 300+ but its percentage impact is much lower than say the 1980's when our market cap was much smaller.

So before we place blame at the feet on the Office of the Presidency, we need to evaluate economic history and see that it is Congress with the real power to drive or deflate the Stock Market regarless which baffoon or Party holds the WH.

created the enormous inflation of the dollar, partly to pay for republican Bush's insanely inflated "war" budgets, and that is the main reason we had one bubble after another, and now, at last, rapidly inflating prices (the excess dollars had to go somewhere). All so Bush could cut taxes of the wealthy and pretend that we did not have actually to pay for his wars, we could borrow the money. Any time the current Democratic Congress has tried to cut off war funding it has failed: republican filibusters. I agree the Democrats have not been completely blameless but, in parcelling out blame for the fiscal and monetary messes we are in now, the far bigger share of the blame goes to this Republican President and the intransigent idelogues masquerading as Republicans in Congress. Nothing is simple here, of course, but long term the Dow has usually done better under Democrats, not Republicans (odd as it may seem); as for the Clinton years, please remember that Clinton and the DLC tried desperately to be Republican Lite when it came to business, foreign trade, and monetary theory... hardly old-time Democrats at all. This time I do not agree with Alter of Freedom.  

I guess if you watch an actual "news", in which CNBC is really the only one save Bloomberg of old that actually reports facts and figures of economic data and not the spin we have all come accustomed to the last 16 years or so with regard to data but CNBC, Investors Business Daily, Business Week do not seem to support your assertion regarding Democrats in Congress when in full power.
Now, of course an arguement can be made regarding the Republican fillbuster I guess the last two, but in terms of % returns if you just go by which Party held Congress with numbers then the data shows a different tale.

None of what I was saying was an indictment on Democrats. Usually it takes messes to be vetted years later. For example, how we recover from the debt incurred because  of thie war will be impacted upon another Congress down the road and not this one. The data just represents the return at the time who held Congress and WH.

Are we saying here that Obama will not be able to be "lite". I tell you want, and many may agree or disagree, but if you look at the economic data coming out he had better chose Mark warner as VP and not Jim Webb. The reason is simple. If Obama has determined to exit Iraq and has formulated his policy to do so, he should name Webb to a Cabinet spot or a Biden to make sure it goes off, but in terms of the biggest issue we face it is not the war but our economy. The economy is impacting the lives of every American. Warner could help Obama with that.

I fear that we will see dropping data the first two years of either administration. We see this every ten or twelve years it seems, but if Obama plans to raise taxes (individual), small business owners and the return the cap gains levels it will slide the scale even more and there will be no one to blame but themselves let alone Republicans. Obama needs to determine to cut spending first and begin with tax loopholes and subsidies as well as the free ride some business are getting before he raises taxes.

His emphasis on social justice, economic fairness ("Three Americas"), and Jacksonian Democracy ("the health of a society should be measured at its base not at its apex") is EXACTLY what we need right now.

condescending "you" statement.  Right, I'm not well informed, I don't read the Financial Times, Wall Street Journal, Economist, Foreign Affairs, etc., etc.  I have no idea what's going on, you're right.

I was enaged in replying to Teddy. Exactly when was I referring to "you" Lowell or your statement. Teddy challenged the point on the data and so I followed up. What am I missing here?

But to your point on Webb. Are you saying that Jim Webb would be better than Warner? I can think of a half dozen folks, beginning with the Blommer, who put Webb way out regarding the economy. Webb is a foriegn policy play not an economy play Lowell. I just do not see how anyone can say Webb is better suited for an economy focus than Mark Warner. How? What experience is the underlying fabric of the basis of this assertion.

Had his economic and business background been that strong it would have been a centerpoint in the campaign against Allen. It was not Lowell. That was not how we beat Allen. Are you telling us now after two years in the SEante he has the business experience to be the go to guy on the economy. Its one thing to address in inequalities of scale, its hardly another to know how to grow our economy through sound implementation of a directed fiscal policy. Warner wins hands down.

Most of the problem comes down to this simple concept. The government = us. When it borrows money it needs to pay it back. That = taxes. If you can't live within your means then you have to eventually pay. I am really tired of all the people who think money grows on trees. It seems they want a free ride from the government. They want a big expensive war, low capital gains taxes, more and more tax breaks. In the meantime these policies are devaluing the dollar and causing economic havoc. They are just like people who bought a big McMansion and can't pay for it. I say start being financially repsonsible.  

"...of course, but long term the Dow has usually done better under Democrats, not Republicans (odd as it may seem)."

With that reasoning, Democrats can't claim a greater division in socioeconomic wealth created by Republican policy.  

...has been controlled by Republicans for pretty much 12 of the past 14 years.  The White House has been controlled by Republicans for 20 of the past 28 years.  You're arguing that they had NOTHING to do with the current mess we're in?  The lack of an energy policy had nothing to do with it?  The corporate cronyism and lack of adequate oversight on the perfect, all-knowing market?   The war in Iraq that has been bungled, thanks to incompetence, and has cost the country trillions of dollars?  The profligate spending combined with tax cuts for rich people and corporations that have created enormous budget deficits?  The culture of corruption.  On and on we could go...but YES, this is the Republican's fault, the American people know it, and this November the GOP is going to get its reward.  Good riddance.

I am argueing we need to look to Congress. Think Leslie Byrne here Lowell. Not the Presidency when we speak of economic policy. The Congress is the sword.

Of course Republicans are to blame for many things as were the Democrats in the 1980's (by the way many of which are still around you know). I was simply pointing out if you look at the data the assertion was not fairly accurate. Dynamics of the Congress influence everything.

Its not the "Republicans" or the "Democrats" fault....its the Congress's fault. The failure to work out diffences or reach compromises and the absolute evil of the entire "committee system" ---see Woodrow Wilson who predicted during his term that this system would eventually ruin our country. This is the result. A spend thrift system bent on appeasing special interest undertaken by both sides in the last thirty years regardless who was in the WH or had the power in Congress.

There is a lot more blame to be yielded than to just one Party my friend. How will the history books record this last Congress and control since 2006 after sweeping change.

What change have we seen Lowell? What real change can we as Amercians point to in the last two years to warrant the 2006 being called a "change" election cycle other than Virginia's success at getting Webbb elected. To me that is the only significant result that I can see. I cannot think of one single issue that was pledged, both foriegn and domestic economics that has been tackled since 2006. We can blame the dynamics, but in the last four years we have experienced a failed President and a failed Congress.

Washington is to blame and so are we frankly.

The reason there hasn't been "change" the past two years is that George W. Bush has either vetoed or threatened to veto every single bill that would have made progress in this nation.  Also, Senate Republicans have repeatedly filibustered or threatened to do so, requiring 60 votes to get anything done there.  

The answer?  Elect enough Democrats to reach 60 in the Senate, and elect a Democrat to the White House. Kick the Republicans sorry butts out of Washington, then watch things finally get done and gridlock get broken.  

The Republicans have been secretly dismantling the New Deal financial reforms in the dead of night (amendments tacked on in the wee hours before the vote) for the last few years. Gradually we are returning to a situation very similar to that which preceeded the great depression.

And it's deliberate, too, not accidental.  This is part of their entire strategy to "shrink government to the size where it can be drowned in the bathtub."  

in my point Lowell when I said "an arguement can be made regarding the republican fillibuster" and of course the veto so I was ocnceding that point, but it does not excuse the 1980's when Congress was controlled by Democrats.

And exactly how many bills regarding the economy came before the Senate and were allowed to come to the floor by Reid or the HOuse by pelosi Lowell. How many? How many actual bills made to the desk for veto?  Sure Republicans are to blame but so are Congressional Democrats who because its an elction cycle for President determined to take a vacation on our dime for two years regarding real change and real policy debate.

So please, exactly explain to me what bills were presented regarding the economy, explain to me how they withheld the purse strings for re-authorizations of the Iraq funding, explain to me where these attempts were made. Instead we got an Energy Act that none of the Presidential folks even voted on, a Farm Bill, mortgage crisis remedies, rebates for taxpayers, oh and the steriod fiasco and lets not forget having the oil companies come before the Congress.

They failed to deliver the change they promised us in 2006 Lowell and you know it. We had all better hope Obama is more successful or we will be back to whwere we started in four years.