Economic Stories of Relevance in Today's World -- July 28, 2013

The Biggest Oil Discovery In 50 Years? - The Economic Collapse Blog - Michael Snyder - July 23rd, 2013 - In a virtually uninhabitable section of South Australia, a discovery has been made which could rock the world.  Some are calling it the biggest discovery of oil in 50 years.  Earlier this year, a company called Linc Energy announced that tests had revealed that there was a minimum of 3.5 billion barrels of oil equivalent sitting under more than 65,000 square kilometres of land that it owns in the Arckaringa Basin.  But that is the minimum number.  It has been projected that there could ultimately be up to 233 billion barrels of recoverable oil in the area.  If that turns out to be accurate, the oil sitting under that land is worth approximately 20 trillion dollars, and it would be roughly equivalent to the total amount of oil sitting under the sands of Saudi Arabia.  In essence, it would be a massive game changer.                            If the 233 billion barrel figure is accurate (and some have even suggested that the true number could actually be 400 billion barrels), that would make it nearly 10 times larger than the Bakken formation, 17 times larger than the Marcellus discovery and 80 times larger than the Eagle Ford deposit down in Texas.                     It would also mean that Australia now has more "black gold" than the nations of Iran, Iraq, Canada and Venezuela.                    The closest town to this oil discovery, Coober Pedy, is in the process of being totally transformed.  It normally only has about 1,700 inhabitants, but news of this discovery has drawn in 20,000 additional people already and real estate prices in the town are absolutely skyrocketing.                 So does all of this mean that gas prices will go down soon?                     Well, unfortunately that is not likely to be the case.                   First of all, the oil in this formation in Australia is going to be quite expensive to extract.  It has been estimated that it is going to cost up to 300 million dollars just to get this site ready for production.                      In addition, many of our politicians are absolutely determined to greatly punish the use of oil because they believe that it is the primary cause of global warming.  So they continue to raise taxes on gasoline consumption.                   Today, motorists in the United States pay an average of 49.5 cents of taxes per gallon of gasoline, and in the state of California motorists pay an average of 71.9 cents of taxes per gallon of gasoline.                      Hopefully the price of gasoline will come down a bit over the next few years, but even if it does I would not expect it to come down too much.                       But what we can be sure of is that the world is not going to run out of oil any time soon.  Those that have been predicting that we are are on the verge of an "energy doomsday" can take a rest for a while.                   Sometimes it is funny to look back and remember some of the ridiculous things that our politicians were saying about oil in the old days.  For example, U.S. President Jimmy Carter made the following statement back in 1977….


It Is Happening Again: 18 Similarities Between The Last Financial Crisis And Today - The Economic Collapse Blog - Michael Snyder - July 25th, 2013 - If our leaders could have recognized the signs ahead of time, do you think that they could have prevented the financial crisis of 2008?  That is a very timely question, because so many of the warning signs that we saw just before and during the last financial crisis are popping up again.  Many of the things that are happening right now in the stock market, the bond market, the real estate market and in the overall economic data are eerily similar to what we witnessed back in 2008 and 2009.  It is almost as if we are being forced to watch some kind of a perverse replay of previous events, only this time our economy and our financial system are much weaker than they were the last time around.  So will we be able to handle a financial crash as bad as we experienced back in 2008?  What if it is even worse this time?  Considering the fact that we have been through this kind of thing before, you would think that our leaders would be feverishly trying to keep it from happening again and the American people would be rapidly preparing to weather the coming storm.  Sadly, none of that is happening.  It is almost as if they cannot even see the disaster that is staring them right in the face.  But without a doubt, disaster is coming. The following are 18 similarities between the last financial crisis and today...                        #1 According to the Bank of America Merrill Lynch equity strategy team, their big institutional clients are selling stock at a rate not seen "since 2008".                       #2 In 2008, stock prices had wildly diverged from where the economic fundamentals said that they should be.  Now it has happened again....


McDonald's falls short, warns of tough year - McDonald's profit falls short of expectations, warns of challenging year ahead - Associated Press - Candice Choi, AP Food Industry Writer - July 22, 2013 - McDonald's Corp. is mixing up its menu to lure more customers but not enough of them are biting.                 The world's biggest hamburger chain on Monday reported a second-quarter profit that rose 4 percent but fell short of Wall Street expectations. It also said July sales are expected to be relatively flat and warned of a tough year ahead.                         Its stock edged down more than 2 percent at $98.05 in premarket trading.                           The company, based in Oak Brook, Ill., says global sales edged up 1 percent at restaurants open at least a year for the three months ended June 30. The figure rose by the same amount in the U.S., where the company has been trying to adapt to changing eating habits with items such as its new chicken wraps and egg-white breakfast sandwiches.                           But the tepid growth in the latest quarter reflect the challenges facing McDonald's, which for years had been a standout in the fast-food industry. Part of the problem is that economic conditions remain weak in many parts of the world. But another factor is that dining habits are changing, particularly in the U.S., with people increasingly opting for foods they feel are fresher, healthier or higher-quality.


Role Reversal: How the US Became the USSR — Paul Craig Roberts - July 23, 2013 - I spent the summer of 1961 behind the Iron Curtain. I was part of the US-USSR student exchange program. It was the second year of the program that operated under auspices of the US Department of State. Our return to the West via train through East Germany was interrupted by the construction of the Berlin Wall. We were sent back to Poland. The East German rail tracks were occupied with Soviet troop and tank trains as the Red Army concentrated in East Germany to face down any Western interference.                 Fortunately, in those days there were no neoconservatives. Washington had not grown the hubris it so well displays in the 21st century. The wall was built and war was avoided. The wall backfired on the Soviets. Both JFK and Ronald Reagan used it to good propaganda effect.
In those days America stood for freedom, and the Soviet Union for oppression. Much of this impression was created by Western propaganda, but there was some semblance to the truth in the image. The communists had a Julian Assange and an Edward Snowden of their own. His name was Cardinal Jozef Mindszenty, the leader of the Hungarian Catholic Church..


Paul Craig Roberts ~ The Total Destruction of America from Within

This video goes into the info from the article above and then goes further.