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| Joined: | Mon Nov 21st, 2005 |
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Anyone (with an interest in sound money),
The link at the top of this post is not, in my opinion, to be taken as gospel truth, in its entirety. I link it for its specific relevance to this topic on sound money that is based upon Joe's Law.
Joe's law goes like this:
Power produced into a state of oversupply (more and more and more power, food power, transportation fuel power, industrial fuel power, production power, home heating power, cooking power, clothes making power, power to light up the dark, electric power, etc.), more and more power, reaching an over-supply of power, abundant power, power flowing like clean water, power flowing like clean air, more and more productive power, will, economically speaking, reduce the price of power, while, and this is the political part of this economic observation, while the power supply increases, and while the price of power decreases, the power to purchase increases, the monetary unit gains purchasing power, as power flows in abundance, because, and this is the reason for the purchasing power increase, because power reduces the cost of production.
In short:
Power produced into a state of oversupply reduces the price of power while purchasing power increases because power reduces the cost of production.
Now I am going to scroll down much of the text in the link, linked above, to find the relevant words that are relevant to this topic:
If the "ur-commodities" (whatever that means) are different in any respect, I suspect, or my speculation is such that, those commodities are self-contained units of power, or self-evidently powerful commodities.
Only a few economists at the time, and even fewer since then, realized that these perplexities pointed to weaknesses in the most basic assumptions of economics itself. E.F. Schumacher was one of these. He pointed out that for a modern industrial society, energy resources are not simply one set of commodities among many others. They are the ur-commodities, the fundamental resources that make economic activity possible at all, and the rules that govern the behavior of other commodities cannot be applied to energy resources in a simplistic fashion. Commented Schumacher in Small is Beautiful:
"I have already alluded to the energy problem in some of the other chapters. It is impossible to get away from it. It is impossible to overemphasize its centrality. [...] As long as there is enough primary energy - at tolerable prices - there is no reason to believe that bottlenecks in any other primary materials cannot be either broken or circumvented. On the other hand, a shortage of primary energy would mean that the demand for most other primary products would be so curtailed that a question of shortage with regard to them would be unlikely to arise" (p. 123).
Those commodities, having power within them, are commodities that power economic production, and as such their value is directly related to the cost of those commodities, and directly related to the price of those commodities, in such a way that the effect of an oversupply, or a quantity of supply that exceeds the demand, is such that the end result is zero price, or falling price, - for all things that require those power commodities in the process of production.
In other words: if the supply reaches a point where demand for those power commodities falls to zero, or nearly to zero, where too much supply causes the demand to fall off into a state of no-demand, the obvious demand for things produced with that power must have also fallen off to zero demand, or near zero. That is so because a demand for something produced with that power commodity is a demand for that power commodity, in direct proportion, and not inversely proportional.
How about another angle of view?
If too many chairs are produced, if an over-abundance of chairs is somehow produced into a state of oversupply, the price of a chair will reach zero, or close to zero, as sellers of chairs try to sell their supplies of chairs, finding no demand, no chairs are sold, no one wants chairs, everyone has a chair, the cost of storing a chair, the cost of maintaining a chair in some warehouse, or the cost of maintaining a chair on a showroom floor is a waste, an added cost, while chairs have been over-produced. No more power is needed to make any more chairs, so the economic demand for chairs reduces the economic demand for the power that is needed to make the chairs, but what costs are still in demand while those chairs are maintained until such time as people are again demanding more chairs (chair owners wear out their chairs)? Power remains in demand even as chair demand falls.
Perishable food is another example. The demand for producing food is a demand for the power required to produce the food. When food is produced into a state of oversupply the costs of production, of the food, go up, as more power is expended preserving the food, as demand for the food falls off, and that is an even higher demand for power commodities. Power remains in demand even as food demand falls off.
If the demand for power commodities goes down because the chair production demand goes down, the demand for power commodities may go up even higher because people are sitting in their chairs while they are browsing on computers, on E-Bay, trying to sell chairs.
The only time a net loss of demand for power commodities will result, from the loss of demand for non-power commodities (like chairs), is a situation where all demand for all non-power commodities reaches a point where total demand for the power required to produce all non-power commodities has caused a net total drop in the demand for power commodities; and that means a drop in the demand for military hardware, a drop in the demand for precious metals, etc.
I am going to read the rest of the article linked at the top of the page; but before doing so I'm going to convey an opinion concerning the "Peak Oil" phenomenon.
When I first began my research (if you can call one guy reading links on the internet and reading books: research) on "Peak Oil" the "Scare Factor" sent me into a campaign to run for congress a second time. My first run for congress was a reaction to the Waco Massacre.
Here is the best link I've ever found on Waco (and during my research on Waco, before running for congress, I interviewed, or questioned, one of the survivors at a public speaking engagement run by the survivors).
http://www.public-action.com/SkyWriter/WacoMuseum/
Anyone living in the U.S. today, who is of an opinion that it is OK to do that stuff, by law, on this land, is someone who is diametrically opposed to me, and to all that I know of morality, law, and economy (those dead tortured babies may have been the next Einstein, Ford, Tesla, Bach, Mozart, Leonardo Da Vinci, or Jesus - Jesus who knows?) . If you think it is OK to torture and murder innocent babies, for example, by law no less, than you are patently evil - in my not so humble opinion.
Anyway, the "Peak Oil" phenomenon, the patently false part, the part where the data suggests a killing off of half the population of the Globe, was cause for me to call up the Libertarian Party, to find that they already have someone running for congress in my district, and then to re-register as an independent. At that point I found this:
http://www.youtube.com/watch?v=NbakN7SLdbk
That sent me on more research, being less inclined to access "the political means", and the result of that effort is the invention of Joe's Law, or authorship of the sentence.
Here is another link on the subject of "Fossil" fuels:
http://www.google.com/search?hl=en&q=Russian+scientists+peak+oil+myth&aq=f&oq=
&aqi=
That is a collection of links; based upon a back-tracking search using the keywords: Russian scientists peak oil myth
Those who control the oil, control the money, control the military, control the politics, and control economy; currently.
Things are changing rapidly:
http://www.reuters.com/article/GCA-GreenBusiness/idUSTRE56G17220090717
Auto executives say that with fewer moving parts, easy-to-assemble electric cars may also lower the bar for entry into the cut-throat autos industry and make battery manufacturers the unlikely competitors for car giants.
"I've said for years that Toyota's rival will be Hitachi," said Kenichiro Senoo, a professor at the Research Center for Advanced Science and Technology at the University of Tokyo.