Thursday, February 24, 2011

The Daily Note - Cover US In Oil

I've often said that we'll rue the day we stopped drilling for oil in the USA. "We need more oil" and "we need to ween ourselves off oil": For over 35 years the debate has continued. For over 35 years we have become increasingly more dependent on oil from the Middle East. For over 35 years we've been lied to about having a lack of oil supply and being told it will take 30 years to bring a well to production. Mind you, that was said over 30 years ago.

Of course there were those who kept saying that if we lack oil, we'll use less of it. Very smart thinking obviously. We were also told that we are the largest most greedy consumers of oil. Maybe, but then we were also the biggest producers of goods that people coveted around the globe.

Then we were told we are ugly Americans, arrogant and boastful, and extremely wasteful. We were a "throw away" society that needed to be scolded and shunned and we needed to be mindful of others around the world. Then we were told to clean up our dirty air and that our dirty cars were the reason forests, rivers and fish were dying. Even though we breathed the cleanest air on the industrial planet, we saw some merit in it, cowered and gave birth to the EPA.

The holy EPA (it's blasphemy to speak of it in unholy terms, you know.) Think it stands for "Environmental Protection Agency" alas I think it's: "Everlasting Power and Arrogance"

What happened since we gave birth to the EPA? In short, hysteria took over reason; real science went out the window and popular science became logic.

  • Cheap clean nuclear energy plans had to be discarded. (No "dirty" fuel rods for our country)
  • We created MTBE and made the oil companies put it in our tanks so we could clean up our water tables later. .right on Feinstein, Boxer and EPA!!
  • We put all "mom and pop" service stations out of business in California because they could not buy gasoline from outside California sources to compete.
  • We became more dependent on oil than ever before.
  • We are now unable to drill for oil without it costing more than paying shipping from overseas.
  • We are now the 2nd largest users of oil.
  • We now pay the 1st largest user (China) to produce our goods cheaply and even though it lacks quality, therefore making us truly a throw-away society, out of need, rather than desire. 
  • We've made the middle east dictators rich but not many citizens of those countries reap the benefits. 
  • We are now blamed for the problems in the Middle East because in their eyes we are still the dirty rich Americans they envy. 
  • Lastly, we still need oil even if we had nuclear powered cars. 

Why did all this happen you ask? Because, for one, the government got involved regulating the oil production in the USA. Much like how the government got involved with regulating the loans the banks had to grant during the mid '90s, and much like how the government has gotten involved with just about every aspect of your life since the EPA was born.

I can't sugar coat it for you because there is a tax on sugar. Not to mention the price of corn just went up again to make that "cheap", dirty ethanol you've been demanding and of course the government had n o t h i n g to do with that either.

So, what to do?  We can start drilling for oil now,  so then later we can bring our troops home and let the rest of the world evolve without our meddling,  and also, finally and more importantly,  so we don't pass this mess on to our grandchildren.  In other words, we can become the nice USA the rest of the world wants us to be by just using our own oil.  Hear that, EPA?

In the meantime, we can trade the markets and hopefully  make some money to keep just a hairs-breath ahead of inflation, and be covered in oil.

Happy Trading, Living and

The Daily Pick - OIH

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