The OPEC Game: Forced non obsolescence

Supply and demand are not the only economics forces at work.  The other market mover is disruptive technology and obsolescence. When a new technology comes along to make another technology moot, then it quickly exploits that weakness and takes over when it's allowed to do so.  For example, where can you get typewriter ribbons anymore?  And where did floppy disks go? Everyone has many USB disk drives. I can't find a computer that uses floppy drives.

In W. Brian Arthur's book The Nature of Technology he explains that the economy is never quite at stasis, it is always changing on the time frame of decades not months like glacial movement but still in motion.  And the genesis of new technologies is born out of the arrangements set up today.

Now, back to OPEC.  OPEC has a valuable commodity they can sell so long as competing technologies cannot make enough money to remain solvent - in business long enough - to obsolete oil for good.

So OPEC plays two long games at the same time.  It tries to maximize the value when it can from every barrel of oil. It plays the production game to raise or lower oil value month over month. It keeps member countries happy and fills national coffers.

But every so often it plays the obsolescence game as well.  It increases production in the face of falling demand. Or it holds production steady in spite of falling prices to make oil so cheap it's the only game in town.  With most of the world reliant on oil products, that makes it harder for people to adopt alternative energy means because it is cost-prohibitive to switch.  That captures another group of people to their customer base.

Vladimir Putin: what not to do

Russia desperate for gas pipeline to Europe

Ok so Vladimir Putin annexed part of Ukraine. And in exchange suffered sanctions, isolation, the Saudis dumping oil to bankrupt both fracking US shale drillers and expensive corrupt oil production like Russia. And a drop in oil prices to levels that might bankrupt Russia.  Does this sound like a good deal for Russians?

So you can't have it both ways, Vladimir.  You can't upset them and expect them to sit quiet. You learned nothing from George Bush II's foray into unilateral action. UK doesn't count they've been US lapdogs since the 1970's. He acted without seeing the long game and ruined his reputation, ruined his countries standing, plunged the economy and so on. I thought Russians were smarter than Americans? They don't have to beat you they control your state through your economy. You are a fuel export country. You depend on reliable treaties. You depend on prompt payment. You've given them an excuse to punish your country. Better for them. Worse for your people.

When you piss off your customers, you're going to pay to keep them.  And this depression might last longer than your hold on the Crimea. So acting alone against the West will continue to cost your people. If you were smart, you'd turn 180 degrees and be the best friend Europe ever had. Wedge between them and the Americans.  

The Fed's Recovery Plan: Lie and hope for the best

People like Max Keiser have railed for years about the atrophied and dishonest nature of the US stock market/ US banks / US regulators relationships and the weak economic outlook.

Here is the reality; the economy was damaged by the US banks' greed.   The US government bailed out companies that deserved to fail (how would the economy look if home owners held mortgages that were worth 50% to the bankruptcy creditors - that seems like a logical  and fair outcome - the debtors win and the bankers lose).  The US regulators are OK with fining US banks and to keep the crimes under prosecuted.  The last fact, the US government shot it's bolt of free money bailing out the companies they hoped would keep jobs. Of course to do that the corporate sociopaths demanded their own livelihood was part of the bargain.

So my postulate is this: the US commercial system will continue to downplay the corruption, continue to lie to the people about what went on, and to hope that the continued wish becomes reality as people make the improvements to the economy themselves.  No bankers will go to jail, no money will be refunded to lost pension funds. The US Fed plans to keep lying about the number of US dollars in circulation and basically "will the recovery" like a necromancer might raise a body from the dead. 

Travel Process Efficiency?

Why institute a travel approval process that saves $10 on a hotel room but through the delay in approving same the cost of the airfare goes up $100?

How can that be claimed to be efficient?

The reality is that when the estimate is made, the airline cost is ignored. Only the accountants enter the data, so that removes the honest assessment of what went on.  No one puts the two numbers together.