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Oops ...

From The Observer:

On Friday night, during what the participants thought were private talks, Venezuela's oil minister Venezuela Rafael Ramirez and his Iranian counterpart Gholamhossein Nozari, argued that pricing - and selling - oil using the crippled dollar was damaging the cartel.

They said Opec should formally express its concern about the weakness of the dollar when the cartel makes its official declaration at the close of the summit today. But the Saudis, the world's largest oil producers and de facto head of Opec, vetoed the proposal. Saud al-Faisal, the Saudi foreign minister, warned that even the mere mention to journalists of the fact that leaders were discussing the weak dollar would cause the US currency to plummet.

Unfortunately his words and those of everyone at the meeting were being broadcast via a live television feed to a group of astonished reporters. 'I couldn't believe it,' said one who was there. 'When I realised they didn't know they were being broadcast live, I frantically started taking notes.'

More here.

Got a car? Fill it's tank today — oil's going up again on Monday (and the dollar's going down).



Well crap. That is both hilarious, and given that i live in the country whose currency is about to collapse further, disturbing.


I am largely paid in dollars. But my mortgage and my tax bills are in sterling.

Colour me ... unamused.


I just bought a new, more efficient car. Unfortunately the money saved by its greater efficiency is almost cancelled out by the oil price rises.

Roll on next August or so when I shall start looking for a new job closer to home.


So, if the link from here a while back is correct, and the US invaded Iraq mostly because Saddam was going to switch from petrodollars to petroeuros, joining Iran and others, then at most the US bought itself, what maybe 1 year of having its currency propped up???

And without our good friends the Saudis, proud operators of one of the most repressive mideval monarchies in the world, we would really be in the shit ...


do major changes in prices only happen on weekdays? Does it have something to do with markets being closed?


I wonder. Half an hour is a very long time to be broadcasting `accidentally' without the techies noticing. Just a thought.


If I understand correctly, as a layman, the U.S. government is, largely, in debt to foreign banks in the form of bonds due to the trade unbalance. This unbalance is a lynchpin in the global economy, the rest of the world benefits from a robust American consumer base, the U.S. benefits from having moderate interest rates which allow consumers, including companies, to exist in perpetual debt.

Hopefully, the devaluation of the dollar will force the U.S. economy, and government, to reduce their debt and end the status as sick man of the world economy.


guthrie: this is false reckoning. If you hadn't bought your new car and still had you old gas guzzler, you'd have all the more reason to get a fuel saving car now. So, unless you could have gotten one that uses even less gas now, be happy - you saved yourself some money. (That is because gas prices are not in your power to change. And don't forget: if prices had fallen your calculation would have erred on the low side, so you would have effectively lost money instead of saving some.)


I have my own reasons for being 'against' the Saudi regime :

As for oil, I don't really care. I'd rather burn peat than deal with these people.


my eeePC is great btw


It's actually cheaper to keep the old gas guzzler in most cases. Take mine: I drive my paid-off car an average of 12,000 miles per year @ 20 mpg. That's 600 gallons of gas a year. If gas goes up $2 per gallon I'll be paying $1200 more each year (ouch).

Let's say your basic Honda Civic's fuel economy over my old car compensates for the $2 per gallon price hike. The cheapest Civic costs about $18,000 here after tax and licence (and not counting interest if financed). It would take 15 years before the new car became a financial plus compared to keeping the old gas guzzler.

Not that my poor old 1999 car will last 15 years. But every year I do keep it will be a plus, money-wise, regardless of the "savings" of a new car's fuel economy.


Hah, I guess the infamous "Collapse of world economy" won't be sudden after all.


tp1024- I was expecting the oil price rise, although obviously I couldn't be very specific about precise timing. The fact I had the money just now to buy the car is down to various personal factors which I won't go into, but I had been hoping for a few months of noticeably reduced fuel bills before things went to pot.

T.D. Risk- other factors in my case include that my old car was a 12 year old Vauxhall Cavalier with 167,000 miles on the clock. A faithful and fairly reliable car, it has needed and would have required more work on it (espcially since my MOT centre screwed up entering my MOT back in May) so I would have had to get a new (to me) car just now anyway. I estimated earlier in the year that by getting a new car with around 10mpg better mileage, I would save at least �500 a year on fuel costs. (that is back of the envelope calculation, not the kind I fully expect some of you guys to go and do)


Cripes. I'm driving from Portland to the Bay Area for Thanksgiving.

Well, at least it's all downhill!


I am largely paid in dollars. But my mortgage and my tax bills are in sterling.

(With no implied obligation to answer, or critisim intended...) I assume that you are taxed on the GBP that you got in your hand (some months ago?), and the problem is that you are actually paying the tax (mainly) out of cash you have received since (sitting on the cash or forward exchange cover being impractical for the amount involved).

Or do the tax authorities manage to screw you over with timing tricks?


Errol: I get to pay my income tax in Pounds Sterling to HMRC. I am careful to retain my "nonresident alien" status as far as the IRS are concerned. ("nonresident" == not in the USA, "alien" == someone foreign; the IRS does not claim tax jurisdiction over the entire planet ... yet!).

Payments I receive in dollars get converted into Sterling as fast as possible, frankly, and so I pay tax on what I receive. Trouble is, what I receive is rather less than might have been expected when I signed those contracts a couple of years ago.

I'm not screwed, I'm just venting. Save your sympathy for other folks who've really got it bad. (Like Airbus. Would you want to be an Airbus sales rep stalking the North American airline industry right now? Aside from the A380 -- 51% of the components of which are made in the USA -- that's got to hurt.)


This seems like a good chance to see just how reliable our individual fingers in the breeze are. Gas is $2.89/gal where I live as of last Friday. I predict that it will not rise to $3.39/gal by this Friday.

Iow, this is just the same old same old alarmism. Things won't get really bad until around the November elections in '08 (though of course, 'really bad' is a wonderful compression.) That's my prediction, posted here in the Year of Our Lord 2007 in the Month of November on the nineteenth day.

Stepping back a bit, is it possible that consumerism as an economic force is really losing its potency?


How do you mean "consumerism as an economic force"? You mean as the driver of increased debt? In which case I thought that was the increased asset prices caused by easy money and lending and stuff like that.


ScentOfViolets: you take a remarkably parochial, America-centric view of things.

Hint: the rest of the planet doesn't march to the beat of your domestic agenda.


ScentOfViolets clearly does not live in California, where I paid that much for gas weekend before last. And that was for the lowest of the available grades.


Dave@6 -- I'm with you. An ingenious way to say "we love each other and hate you" without doing any actual damage to the billions of dollars squirreled under your bed.


Hey, Charlie. Any thoughts on the Amazon Kindle? I think it's ridiculously over priced ($399!) as are the downloads ($9.99). The only thing I like is the always available wireless connection. I think ereader companies should adapt the cell phone strategy, basically give phones away for free if they sign up to a cheap monthly service. And ebook downloads should be like .99 cents.


The amazon kindle? Irrelevant to me. They picked a cellphone protocol that won't work over here. (There are also rights-related reasons why it's difficult to do an ebook store that sells books both to North Americans and to rest-of-world English speakers.)


Glee. I have the opposite situation from you, Charlie -- I owe the IRS a shitload of back taxes, in dollars, and get paid mostly in Euros. This year has been very, very good to me (not just due to exchange rates, but due to the fact that the translation industry in general is quite healthy this year and I've also apparently crossed some sort of threshold after which you can't beat the customers off with a stick.)

Hell, if the dollar dropped to 20 cents I'd be happy (at least until it became unfashionable to translate things into English.) I'm popping the corn and sitting back to watch and chortle.

Ha. Yes. lists the Euro at $1.46. Go, go, gadget currency!


With all this in the air it would be lovely if I could buy Mr Stross's works here in Australia for AU$12 instead of $20, when they retail in the US for $10! Been a long while since you only got US50c for an Aussie dollar.

I assume that Borders pocket the difference, rather than Charlie...


Folks, to put thing in perspective. In Europe the gas price is around 1.5 Euro per liter. That is almost 9 US$ per gallon. Of course the average car runs better then 40 mpg. Also a car costs twice the price you pay in the US for the same model (yeah tax) and on top of that we have to pay road tax (which is used to keep the roads in a nice condition) of about 600 US$ per year per car (for a 2000 lbs car). And don't get me started on the 50% tax I'm paying (on a lower income than my US collegues get in the same company for the same job).


on top of that we have to pay road tax (which is used to keep the roads in a nice condition)

That might be true of NL, but not of the UK. Winston Churchill abolished the Road Fund in 1936. Vehicle Excise Duty, often informally still known as road tax, isn't hypothecated, and wouldn't pay the full costs of the roads if it were.


off topic question to all you pundits out there: if a bomb is discovered on a plane what can be done? is it possible to flush it off? maybe throw it off in some way? i meen it is possible technically to fly with a decent sized opening in an aircraft right? i suggested this in class the other day and everyone acted like it was the dumbest idea ever. is it?


I'm not sure what you're trying to say, Charlie. Maybe I was unclear, so let me try again. I don't think mutterings like this are going to have much of an effect on the economy (the American economy at least, and certainly the dollar is not going to be decoupled from oil anytime before the next U.S. election.) I don't think the price of gas is going to rise much - again, before the next election, after, all bets are off - certainly it's not going to double, and I doubt if it will even rise by as much as 10% (although saying that is damning with faint praise) until sometime fairly late next year.

When I say that consumerism as an economic force may be almost spent, I meant to say, partially as guthrie suggested, that it will no longer be a driver of increased debt, at least, here in the good old U.S. of A. But what I also meant in the broader context was that acquiring objets d'art, tchotckes, new furniture, electric lawn mowers, smart blenders, a new set of towels every year, etc. depends on cheap energy.

I suggest that possibly people instead of buying cheap durable goods to drive the economy will be forced to turn to acquiring durable durable goods, if you know what I mean. They simply won't be able to afford the chintzy new stuff that can be replaced as soon as the 'new' wears off of it. New has a distinctive smell you know, and it is known to dissipate fairly quickly. In my case, I associate it with the new plastic smell you get when you open up new electronics, or that odd but pleasant odor new books have (as opposed to the odd but pleasant odor old books have, of course.)

In fact, this is what a lot of savvy people do anyway. I do a fair bit of running and hiking, and my shoes ain't cheap. But that's because two $40 pairs of running shoes won't last as long as one $80 dollar pair. Same with pants - good pants can last ten years and more if you buy quality. Household appliances. You can buy a cheap coffee maker, even a cheap coffee maker that looks good for maybe $30. But it only lasts a couple to five years. A good coffee machine can last much much longer, far longer than a linear extrapolation of its cost suggests.

Furniture . . . don't get me started. There's literally tons of cheap colorful flimsy stuff to be had for a song. You want good furniture, you either make it yourself or be prepared to pay thousands and thousands of dollars for it. Funny thing though, you can pass it down to your kids, and they to theirs, and it will still look pretty much the same, modulo multiple refinishings.

Maybe the future is an old-oak and iron future, and not a plastic future after all.


"Ikea furniture has a half-life of two moves or five years, whatever comes first." -personal motto


You guys obviously haven't lived in a student town, where secondhand (third/fourth/don't ask-hand) furniture is king.. .


I am trying to follow this thread. I think I can throw the bomb off the plane if I tie it to a barrel of oil and do it before the next US election. Do I win the IKEA gift card?


No, you win a one way trip to Afghanistan.


Speaking of oopses. Do you think Darlings data giveaway will put a break on the national ID card scheme?


OGN: The news is ... interesting, today ...

The PM has just apologized to the House and ordered a government-wide security audit. This should be absolutely fascinating. We even have former HO junior ministers coming out of the woodwork and muttering darkly about security and the national identity register. The phrase "as popular as the poll tax" has been uttered on BBC Radio 4. We shall see!


Pedantry Warning...........

Would that be a Break or a Brake on the National ID Card system?

I would hope it is the kind braking that is required to of one to pass the 'Emergency Stop' part of the UK driving test.


ryan: "i meen it is possible technically to fly with a decent sized opening in an aircraft right?"

An Aloha airlines 737 had the top of the fuselage ripped off and flew safely to a landing with only the loss of one stewardess.

Obviously this is an extreme case and the aircraft was not at stratospheric altitudes. Poking a hole in the fuselage at 30k feet is going to cause severe decompression, so the aircraft must dive to a lower altitude as quickly as possible.


Cue a line of spokespeople saying "But of course this would never happen with the ID cards". I then have to stop myself shouting at the radio "No you fuckwits, it is just an example of what can go wrong, other mistakes will be made with ID cards."



Sorry, that running trainer thing was recently debunked. When they tested wear and comfort for them, there was litterally zero correlation between price and those factors.

I use Silver Shadow running trainers (basically all the time, I so like working in Games...). I replace them every year because they wear cosmetically badly (scuff up and discolour), not because they're no longer good for running in (and indeed I do tend to do my actual running in "last years"). They're �20-25 a pair.


Sorry, but in this case, anecdotal quite definitely trumps whatever you've managed to find (they're my feet after all.) It takes me about two-and-a-half to three months to completely wear through the bottom black rubber layer and a good deal of white on the cheapies. It takes closer to six months to wear through that layer on the brand I buy(Adidas.) That's running on pavement, about 30 miles/week, perhaps a bit more, seven to nine miles at a pop. I could care less about the appearances, whether the upper mesh is discolored, or whether my big or little toes or sticking out through holes in the sides. The other thing that happens with the cheaper brands is that the bottoms come unglued. I think it's a glue problem; I get about three to four inches at the front flapping like a tongue.

Now, I don't know where they're getting their samples, but the cheap shoes I buy at Payless, the Adidas I buy at Pennies.


On the trainer subject, it takes me a year to actually wear them out, but I need new trainers roughly every 6 months because after 6 months of use the padding and shock absorption etc gets worn enough that my knee starts acting up due to changes in foot movement.

Of course, when I was at university, I broke a pair of �20 trainers in about a week of walking 6km a day. But then I walk fast. The good trainers (more �50) that I have been buying the last few years don't break even when worn, and are still mostly wearable.


Are those specifically running trainers, guthrie?

I find tennis trainers do indeed wear down very quickly, running ones..don't.


I buy the Adidas Ozweego. Is that considered a running shoe? The only reason I buy them, I may add, is because I just happened to buy a pair fifteen(?) or so years ago, they didn't seem to be too expensive, and they did the job. So of course, being of the male persuasion, that's what I've continued to buy. I'm in and out of the store in about ten minutes.

Anyway, is there some official guide as to what is a 'running trainer' and what isn't? Somehow doesn't seem fair to say that if the shoes wear the way me and guthrie say they do that you can say that they must not be 'running trainers'.


The cheap ones were generic "sort of running but since we're cheap its not relaly recomended", and the ones I wear now are running ones bought at a shop in Edinburgh that sells only running gear. THe staff are helpful and willing to spend 20 minutes with you trying on 6 or 7 different pairs until you find one that fits properly. (And they'll let you jog up and down outside to try them out)


You're a more careful shopper than I am; I happened to buy ozweegos the first time because there was a two-for-one sale, which made them as cheap as what I would have bought at Payless. I don't read any running mags, I just happened to notice on my own that they wore longer. I'm guessing that it's probably something to do with material quality and stitching. I run in all sorts of foul weather, so perhaps even a marginal 10% difference in quality quickly translates into twice the wearing time, once the joins start to give and the tread to wear.


Guthrie; I assume the funny symbol before the numbers denoting prices in your posts are an attempt at a pound sign, right? If so, you might want to type £ instead, so those of us who don't use the same flakey codeset your computer is using can read your posts.


Not to hijack the thread, but since it's Thanksgiving, and my job, the washing up (I'm a far better cleaner and tidyer than my partner), any review on the Kindle from knowledgeable readers? I happened to comment on a related thread that book readers may not be the best idea for fiction, but as a reference library they'd be great. The point was brought home recently when a colleague of mine offered to give me a book scanned and stored on a flash drive. Four gigs with folders titled in Russian, argh!! After a fruitless few minutes of searching for Fulton's 'Algebraic Geometry' (something of a minor classic), it occured to me to simply copy the entire drive onto my desktop. Looking back over the contents, I've got literally dozens of books, some well over 500 pages long, crammed into a very tiny space. More signficantly, those books, had I bought them as hardbacks , would have cost perhaps $3,000 to $4,000 dollars . . . a not insignificant sum to me. All of a sudden a reader that can handle pdf and djvu formats looks very attractive, even if it is a bit pricey.

So anyway, what's the scoop on Kindle? Despite all the promo, it doesn't seem to have quite what I want, in particular the files it can read don't seem to be very compatible with what I need.


Yes, I'm afraid I'm running XP. Don't shoot me. I'm giving consideration to learning how to use something else over the next year or three.

How do you mean and symbol and pound? I recall somehting about this place running symbols differently, but I have no idea what the name was.


"Fill it's tank today"

Hmmm.... poor grammar, or just drinking while blogging?


Henry: acute bronchitis plus sinusitis.


Well, ScentOfViolets, welcome to the wild and crazy world of book piracy. Bit cheeky to bring it up on an author's web page, maybe.

But when students pay USD$900/year for textbooks, something like this, 4.5 GB / 476 physics textbooks must be a lifesaver.

Not sure what the ethical course of action is in general. I have the Feynman Lectures in dead tree, so I would not feel too guilty if I picked up an electronic copy. For someone below the poverty line or in a developing country, I imagine pirated ebooks are a valuable if not necessary resource.


guthrie, I'm fairly sure it's an Internet Explorer problem, not an XP problem and moving to Firefox is a lot easer than changing operating systems. Can someone on a unix confim that this "£" is a pound sign?


Tobias: yes. But I don't think it's a "unix" issue as such.


Tobias: I'm on Linux and that pound sign is a pound sign.

Internet Exploder doesn't give ISO8859/15 no respect.


WEll, in firefox that symbol in post 51 looks like a pound sign, and in IE it looks like quote marks round a capital A with a pound sign. INteresting. Sorry for hijacking the thread, Charlie.


Guthrie et al: let's all stick to typing out £ or £ -- both of which encode for a pound sign in ISO8859/15 and are understood by all standards-compliant browsers on all platforms. Right?


£ - £ Firefox 2.0/Mandriva Spring '08 KDE3.5

Winston Churchill abolished the Road Fund in 1936

No he didn't; he was on the backbenches grappling with the Black Dog in 1936. 1926 perhaps?

Further, I see Airbus is pissed off about the tanking dollar; strangely, it doesn't seem to have occurred to them to bill in euros yes. I give'em six months.


49: Charlie types with his nose? Truly a Renaissance Man.


I would pay good money to see that. Such a beatiful mental image.


Actually, oil is now back at $91 per barrel, as of 11/29/07.

And the American GDP grew at 4.9% in the third quarter of 2007, with a 16% increase in exports year-on-year. Compare this to the Eurozone countries.

Two facts should be kept in mind:

a) petroleum just isn't as important as it used to be. The amount needed for each $ of GDP (inflation-adjusted) is now about half of what it was in 1980.

Moreover, higher real petroleum prices reduce the role of petroleum further. Human beings, especially those blessed with the scientific method and market pricing, are not rabbits. They do not eat the last blade of grass and starve.

As a commodity rises in price, substitutes are found, ways are found to do more with less of it, and alternative sources are located.

This is automatic. It's like pulling on a rope. It's why, despite vastly larger populations with vastly higher per-capita consumption levels, commodity prices tend to fall in the long term.

In other words, high prices result in low prices; scarcity causes abundance.

eg., the Brazilian national oil company just made a discovery which will turn Brazil into a major oil exporter on the scale of Norway; it's in water so deep that it couldn't even have been located, much less profitably exploited, only 15 years ago.

Failure to appreciate this process is why people get themselves into a tizzy over "peak oil", just like the Club of Rome thought we'd all starve to death in the 1980's. And for that matter, just like those bemoaning the dearth of charcoal in Britain in the 1750's.

b) a currency is not a collective virility symbol.

It's an accounting device, not the Big National Penis.

Confusing the two invariably leads to bad policy.

Eg., Winston Churchill's monomania for restoring the Gold Standard in the 1920's at pre-war parity, thus grossly overvaluing the pound.

That crippled the British economy for the rest of the 1920's, leaving the UK as perhaps the only major country in the Western world whose economic growth record was better in the 1930's than the 1920's.

After Britain went off the gold standard in 1931, it was finally free of the incubus of a "strong" currency.

Note also that the Chinese government flatly insists on keeping the rembai below the level it would be on a float, despite protests from everyone else.

This is a strikingly rational policy, in contrast to the German-style central bankers who've allowed the Eurozone to be crippled, or at least severely hindered, by the run-up of the Euro.

They're probably still traumatized by memories of the Great Inflation; it must be hereditary.


BTW, a "trade surplus" is also not the Big National Penis. Nor is it an indication of economic health.

Eg., Britain usually ran a merchandise trade deficit for the period after the 1840's, and had one more often than not before then too.

The US usually had a deficit in the same period too; in fact, it had an overall deficit including invisibles. This is another way of saying "capital imports".

Capital usually flows towards fast-growing economies.

It would have been a bigger (and better) deficit without the iniquitous US tariff policy of the 19th century, which as tariffs always do redistributed income from the poor to the rich and distorted capital allocation.

When you're looking at how a country's doing, the relevant figures are trends in GDP growth, productivity, Total Factor Productivity, job creation, labor force growth, amount of capital per worker in relation to output, and per-capita income.

Nothing else really matters.


I thought paranoia about inflation in Europe was due to the influence of the kind of inflation allergic economists and government haters who were in charge of the UK in the 80's.

As for turnign BRazil into another NOrway- I don't see how this rebuts anything to do with the simple fact that discoveries of exploitable oil fields has fallen to the stage where we use several times more than we find new ones.



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This page contains a single entry by Charlie Stross published on November 18, 2007 3:02 PM.

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