COP21 Is a Big, Fat Fraud.

Yes, they said they'd educe carbon emissions and opted to get the target for maximum global warming to "well under 2 degrees Celsius." Except the pledges brought to the table beforehand would bring us about 2.7 C. Plus the phrase "Fossil Fuels" is nowhere to be found in the Paris agreement

Good grief... 21 years of treaties and negotiations have all been stepping around the main problem: the production of fossil fuels. And as I said in the last post, we can't afford to wait for peak oil, peak coal and peak natural gas to work their charms on Business As Usual and reduce its emissions.

Look at this graph provided by the BP Statistical Energy Review of 2015:

Notice how fossil fuels and nuclear outrank hydro and renewables by 9-to-1 in the amount of energy produced? And this is worldwide!


From The Real News: 'Fossil Fuels' Nowhere to be Found in the Paris Agreement:

The Guardian reported that James Hansen, former lead scientist at NASA, said that the Paris climate agreement is all BS. He says as long as fossil fuels appear to be the cheapest fuels out there, they will be burned. If we follow this agreement, we'll have 2 degrees Celsius warming target, and then try to do a little better every five years. It's just worthless words. There is no action, just promises, he says. Further, our next guest, scientist at Pace University Chris Williams, the author of Ecology and Socialism: Solutions to Capitalist Ecological Crisis just wrote about the Paris outcomes. And he says despite the self-congratulatory statements from world leaders praising themselves for single-handedly saving the world from climate catastrophe, the reality is that they have set the planet on course to burn....

 

[Professor Williams says,] "[D]espite the fact that they've reduced, you know, how much we can go up by and stay safe down to 1.5 degrees, all the pledges that have come in, all of which are now voluntary, so there's no enforcement mechanism, actually put us on track for 3 degrees or more of warming. So--and there's no real mechanism for financing. They're expanding the role with the market, cap and trade, including offsets, all of which we know don't work. And there's no mention of the phrase 'fossil fuels' anywhere in the agreement. And we know that 80 percent of the fossil fuels that we already know exist in reserves have to stay under the ground....

 

"So what we need to be talking about is how come we're not closing down, first of all, exploration for more fossil fuels, which is not happening? Secondly, the most polluting fossil fuels in use at the moment, which is coal. Why we're not ending those, and transferring the trillions of dollars that are subsidized to produce more of these things, more of this energy source, why are we not transferring that to developing nations so that they can skip the whole generation of dirty energy and move on to clean alternatives? The alternatives are out there.

 

"Well, there is a mechanism for saying, well, we need to review this every five years, because maybe we're not on track for where we need to go. And we already know that we're not on track. They know that they're not on track. But basically we also know that the sooner we take action the easier and the cheaper and the more effective all of our solutions will be. So by delaying things for another five years, and not saying we're even starting things until 2020, and whatever we do there is no enforcement mechanism. It's all completely voluntary.

 

"So what should we be doing? Well, first of all, ending all the subsidies to fossil fuel production to incentivize that. According to the IMF that's several trillion dollars. Trillion dollars. And yet they're fighting over handing $100 billion a year to developing countries to help them. So the first and most obvious thing would be to end subsidies to produce fossil fuels. That would immediately alter the price of fossil fuels disadvantageously and improve the cost-effectiveness of solar and wind, and wind is already cost-competitive with most forms of fossil fuel production, even with the subsidies."

http://therealnews.com/t2/index.php?option=com_content&task=view&id=31&Itemid=74&jumival=15300

And yes, James Hansen really calls the COP21 talks "bullshit".

From The Guardian: James Hansen, father of climate change awareness, calls Paris talks 'a fraud':

Mere mention of the Paris climate talks is enough to make James Hansen grumpy. The former Nasa scientist, considered the father of global awareness of climate change, is a soft-spoken, almost diffident Iowan. But when he talks about the gathering of nearly 200 nations, his demeanour changes.

“It’s a fraud really, a fake,” he says, rubbing his head. “It’s just bullshit for them to say: ‘We’ll have a 2C warming target and then try to do a little better every five years.’ It’s just worthless words. There is no action, just promises. As long as fossil fuels appear to be the cheapest fuels out there, they will be continued to be burned.”

 

The talks, intended to reach a new global deal on cutting carbon emissions beyond 2020, have spent much time and energy on two major issues: whether the world should aim to contain the temperature rise to 1.5C or 2C above preindustrial levels, and how much funding should be doled out by wealthy countries to developing nations that risk being swamped by rising seas and bashed by escalating extreme weather events.

 

But, according to Hansen, the international jamboree is pointless unless greenhouse gas emissions are taxed across the board. He argues that only this will force down emissions quickly enough to avoid the worst ravages of climate change.

http://www.theguardian.com/environment/2015/dec/12/james-hansen-climate-change-paris-talks-fraud

And yet right now there is such an oversupply of oil that the prices there are swooning. I'm not sure how competitive renewables (solar, wind) are with the low, low prices the economic and oil market experts expect to see in the next several years.  And renewables competing with fossil fuels these days is rather like catching a falling knife.

From the UK Guardian: How Low Can Oil Prices Go?:

Not only did US prices fall under $40 this week but so did the global benchmark Brent crude oil prices, for the first time since February 2009. The global supply glut of about 1.5m barrels per day is the driving factor behind the lower oil prices, with much of that overproduction because of Opec’s opening the spigots. [Jay Hatfield atr Infrastructure Capital Advisors] said there’s another factor behind the new drop in oil prices: warm weather. “The fact that you can almost go swimming in New York City right now is horrible. Absolutely horrible [for heating oil demand]. To me, that’s the straw that is breaking the camel’s back. We’re ground zero for fuel oil demand,” he said.

 

The El Niño weather phenomenon can bring milder winter weather to the northern part of the US, and that’s been seen in places like New York and Chicago, where December temperatures are above normal, reducing heating demand. If Opec’s disorganization continues and temperatures stay mild, that could add further pressure to prices, he said. “I thought prices would have stabilized in the $40 to $50 area, but … now it could be $35 to $40,” he said. A few factors could influence oil, such as next week’s Federal Reserve’s monetary policy meeting, where the Fed may raise interest rates for the first time in seven years. That could give the dollar another boost, and Kessens said the greenback’s strength has hit oil since it is dollar denominated.

 

Next week is the last full trading week of 2015, so there could be some book squaring as investment managers close up accounts before the holidays when trade volume dwindles. Daniel Pavilonis, senior commodity broker with RJO Futures, said the next target for prices is likely the 2008 low. “I see prices going lower. I wouldn’t be surprised if we saw an uptick from here next week, maybe to the $40s, but then see a sharp decline, a sell-off below $35. There’s so much supply out there. I think [prices are] going to be lower than people will perceive,” he said.

 

Taking out a level that’s held for so long could be jarring and may have a snowball effect, he said. On the other hand, there is likely to be some opportunistic buying simply because prices are so low. Pavilonis didn’t rule out a dip under $30 a barrel, but just how far prices may go is hard to determine. “It’s hard to call a bottom. It’s like catching a falling knife. Just let the knife fall to the side and pick it up later so you don’t get hurt,” he said.

 

http://www.theguardian.com/business/2015/dec/13/oil-prices-opec-market-share-strategy-el-nino-us-interest-rates

And it looks like Nature had already opened her Pandora’s Box.

October 2015 temps of 1.28 C above 1880s levels…. That’s 64% of the allotted 2 C target. Worse when you compare it to the newly-agreed 1.5 C target from the COP21 conference.

[December 2014 through November 2015 temps of] 1.06 C Above 1880: Climate Year 2015 Shatters All Previous Records For Hottest Ever.

Robertscribbler 14 December 2015

We knew it was going to be a record breaker. We knew that atmospheric greenhouse gasses in the range of 400 parts per million CO2 and 485 parts per million CO2e, when combined with one of the top three strongest El Ninos in the Pacific, would result in new all-time global record high temperatures. But what we didn’t know was how substantial the jump would ultimately be.

 

Today, the numbers were made public by NASA. And I hate to say it, but it’s a real doozy. Overall, according to NASA, Climate Year 2015 — the 12 month period from December of 2014 through November of 2015 — was 0.84 C hotter than NASA’s 20th Century Baseline. That’s 0.11 C hotter than previous hottest year 2014 and a full 0.21 C hotter than climate change deniers’ favorite cherry — 1998. In other words past record hot years are being left in the dust as the world is heating up to ever more dangerously warm global temperatures.

(Image source: NASA GISS.)

In any case, the current NASA Graph above is going to need some serious adjusting as the new global average for climate year 2015 is simply off the top of the chart. A new jump that gives lie to the increasingly obvious fake claim made by climate change deniers over the past two years that global warming somehow ‘paused.’

 

But aside from reality once again making the fossil fuel cheerleaders of the world (aka climate change deniers) look increasingly imbecilic, 2015’s new temperature increase is a visible sign of increasing climate danger. This year’s 0.84 C temperature departure above NASA’s 20th Century baseline is 1.06 C hotter than 1880s values. It’s a number just 0.44 C (or two more strong El Ninos) away from crossing the very dangerous 1.5 C threshold that nations of the world recently pledged to attempt to avoid at the Paris Climate Summit. It’s also a number more than halfway toward hitting the catastrophic 2 C warming threshold. Perhaps more ominously, Monthly temperature departures in October of 2015 hit a range of 1.06 C above the 20th Century baseline and 1.28 C above 1880s averages — shorter term ranges that are already coming close to testing the 1.5 C threshold.

http://robertscribbler.com/2015/12/14/1-06-c-above-1880-climate-year-2015-shatters-all-previous-records-for-hottest-ever-recorded/?replytocom=60338#respond

And just how much of a percentage of 1.5 C of the COP21's agreed-to global warming target is 1.28 C above 1880s levels is? About 85%. Forget waiting for peak oil, peak natural gas and peak coal to occur if we want to avoid catastrophic climate change and even more bizarre global weirding -- business as usual warped by fossil fuel extraction peaks and declines will still yield an atmospheric CO2 content of about 550 ppm (CO2e would be worse), yielding an ECS temperature rise of 3 C and an ESS rise of 6 C over the space of a thousand years. In geological time, that means Near Term Human Extinction.

Oil May Drop to 20 Dollars a Barrel. This Is What Peak Oil Looks Like!

Two articles harvested from The Automatic Earth, December 9th..

Allegedly, it would be a boon for the economy, but in the oil exporting countries and extracting companies it's a fiscal bane that can't be worked around except through austerity. Since the USA has a lot of oil extracting companies, the oil patch won't see the boom! And maybe no one else. Too much debt overload, you know.

Oil Producers Prepare For Prices To Halve To $20 A Barrel

(UK Guardian)

The world’s leading oil producers are preparing for the possibility of oil prices halving to $20 a barrel after a second day of financial market turmoil saw a fresh slide in crude, the lowest iron ore prices in a decade, and losses on global stock markets. Benchmark Brent crude briefly dipped below $40 a barrel for the first time since February 2009 before speculators took profits on the 8% drop in the cost of crude since last week’s abortive attempt by the oil cartel Opec to steady the market. But warnings by commodity analysts that the respite could be shortlived were underlined when Russia said it would need to make additional budget cuts if the oil price halved over the coming months.

 

Alexei Moiseev, Russia’s deputy finance minister, told Reuters: “If oil goes to $20, we will need to do additional [spending] cuts. Clearly we have shown that we are very willing to cut fiscal spending in line with an oil price at $60, for example. In order for us to be long-term sustainable [with the] oil price at $40, we need to do additional cuts, but if the oil price goes to $20 we need to do even more cuts.” Russia and Saudi Arabia – the world’s two biggest oil producers – both increased spending when oil prices rose to well above $100 a barrel. The fall from a recent peak of $115 a barrel in August 2014 has left all Opec members in financial difficulty, but Saudi Arabia has refused to relent on a strategy of using a low crude price to knock out US shale producers.

 

Hopes that Opec would announce production curbs to push prices up were dashed when the cartel met in Vienna last Friday, triggering the latest downward lurch in the cost of oil. Lord Browne, the former chief executive of BP, refused to rule out the possibility that oil could halve again in price when he was interviewed by Bloomberg TV. Asked if oil could hit $20 a barrel, Browne – who ran BP from 1995 to 2007 during a period when the cost of crude rose from $10 to $100 a barrel, said in the short term nothing was impossible. He added: “In the long run, $20 is probably wrong, but that’s as far as I’d go.”

Source: UK Guardian

 

http://www.theguardian.com/business/2015/dec/08/oil-producers-prepare-prices-halve-20-barrel

The entire global economy may be facing severe demand destruction in the months ahead and Bloomberg says it’s EXCELLENT! “..the world has enjoyed a windfall equivalent to 2% of GDP it would otherwise have spent on crude..” The crude does come out into the world from the Earth for free, you know; somebody has to pay to get it out -- and they need to make a profit selling it at a price the end-customers can afford. Otherwise, they gotta pay the piper; which means, the money will still be spent on getting the oil to market.

OPEC Provides Economic Stimulus Central Bankers Can’t or Won’t

(Bloomberg Business)

The world’s central bankers just got a helping hand from the world’s oil ministers. As the ECB delivers less monetary stimulus than investors sought and with the Federal Reserve set to tighten next week, the world economy may find support instead from the weakest oil price in more than six years. West Texas Intermediate is trading at about $40 a barrel four days after OPEC chose not to limit output, extending the commodity’s decline from its June 2014 peak of $107.73 and this year’s high of $62.58 in May. While its earlier slide failed to provide the economic pickup some anticipated, economists at UniCredit, Commerzbank and Societe Generale are still banking on cheaper fuel to spur spending by consumers and companies in 2016.

“On net, central bankers should take this as a positive,” said Peter Dixon, an economist at Commerzbank in London. “This does help to stimulate demand by leaving a little bit of money in the pocket and providing a feel-good factor.” At Societe Generale, Michala Marcussen, global head of economics, reckons every $10 drop in the price of oil lifts global growth by 0.1 percentage point. She estimates that since 2014, the world has enjoyed a windfall equivalent to 2% of GDP it would otherwise have spent on crude. “Our biggest relief last week was that OPEC decided no output cut, promising consumers inexpensive oil for longer,” said Marcussen. Even though falling oil may weaken the inflation rates central bankers are struggling to lift, Erik Nielsen at UniCredit said it was important to recognize that it’s “‘good’ disinflation, because it stems from supply rather than demand and so should raise real income, thereby propelling consumption and the recovery.”

“A drop in energy prices is the equivalent of a tax cut, with no implications for debt,” he said, adding that faster expansions as a result should end up bolstering prices too and so investors should be wary of wagering on a deterioration in inflation.

http://www.bloomberg.com/news/articles/2015-12-08/opec-provides-economic-stimulus-central-bankers-can-t-or-won-t

Some Run-Down Areas in New Orleans...

... something tells me, though, that they won't stay run-down for long. In fact, some stretches of the Fifth Ward New Orleans near Bayou St John has gentrified already, and the gentrification is spreading! Well peak oil will only make city life more and more attractive. 'Cause who wants to waste money and destroy your sanity sitting in gridlocked traffic two hours each way to and from work?

Orleans Ave outbound, Right Side, Fifth Ward New Orleans.

The blighted properties won't stay blighted for long!

Orleans Ave Outbound Left Side Villere to Claiborne

 

The New Lafitte Projects.
Not run down but they have algae growing on them.
This area will gentrify FAST.

A PLANT in the esxpressway viaduct!
This area won't be gentrifying anytime soon... until the X-way is gone.
 

 

The Economy Isn't Doing too Well... The Business Cycle Hints We're Due for a Recession and Family-Supporting Jobs Haven't Recouped Their Year 2000 Levels.

I have a small collection of article snips harvested from The Automatic Earth, for December 5th, December 6th, December 7th and December 8th, 2015. There are more collected from Mainstream and other Reputable Sources by Ilargi Meijer over there -- just click on the above links if you wish to pursue them.

Okay, first off the bat, Peter Schiff claims that the economy has "imploded" and according to his analysis, we are at the point now in our economy where we were in 2007 when home mortgages were starting their meltdown which eventually resulted in the Global Financial Crisis of 2008. So it looks like 2016 may be a doozy!

Peter Schiff: ‘The Whole Economy Has Imploded’

(SHTFplan.com)

Peter Schiff continues to argue that the economy is on a downhill trajectory and this time there’ll be no stopping it. All of the emergency measures implemented by the government following the Crash of 2008 were merely temporary stop-gaps. The light at the end of the tunnel being touted by officials as recovery, Schiff has famously said, is actually an oncoming train. And if the forecast he laid out in his latest interview is as accurate as those he shared in 2007, then the train is about to derail.

We’re broke. We’re basically living off of debt. We’ve had a huge transformation of the American economy. Look at all the Americans now on food stamps, on disability, on unemployment. The whole economy has imploded… the bottom hasn’t dropped out yet because we’re able to go deeper into debt. But the collapse is coming."

Fundamentally, America is worse off now than it was pre-crash. With the national debt rising unabated and money being printed out of thin air without reprieve, it is only a matter of time. Schiff notes that while government statistics claim Americans are saving again and consumers seem to be spending, the average Joe Sixpack actually has a negative net worth. But most people don’t even realize what’s happening:

I read a statistic… The average American has less than a $5000 net worth… it’s pathetic… we’re basically broke… but in fact it’s much less… If you actually took the national debt and broke it down per capita, the average American has a negative net worth because the government has borrowed in his name more than the average American is able to save.

What’s happening is pretty much what we would anticipate. I don’t see from the data any real economic recovery, certainly not in the United States. We’re spending more money, but it’s not because we’re generating more wealth. We’re generating more debt. We’re using that borrowed money to consume and so temporarily it feels that we’re wealthier because we get to spend all that money… but we have to come to terms with paying the bill. The bills are going to come due. Right now interest rates are being kept at zero which makes it possible to service the debt even though it’s impossible to repay it… at least we can service it. But once interest rates go up then we can’t even service it let alone repay it. And then the party is going to come to an end.

http://www.shtfplan.com/headline-news/peter-schiff-warns-the-whole-economy-has-imploded-collapse-is-coming_12062015

Last Gasps of a Dying Bull Market – And Economy

(Fred Hickey via Tyler Durden)

Deteriorating market breadth and herding into an ever-narrower number of stocks is classic market top behavior. Currently, there are many other warning signs that are also being ignored. The merger mania (prior tops occurred in 2000 and 2007), the stock buyback frenzy (after the record amount of buybacks in 2007 buybacks were less than one-sixth of that level at the bottom in 2009), the year-over-year declines in corporate sales (-4% in Q3 and down every quarter this year) and falling earnings for the entire S&P 500 index, the plunges this year in the high-yield (junk bond) and leveraged loan markets, the topping and rolling over (the unwind) of the massive (record) level of stock margin debt… and I could go on.

It was very lonely as a bear at the tops in 2000 and 2007. I was just a teenager in 1972 so I was not an active investor, but just a few days prior to the early 1973 January top, Barron ‘s featured a story titled: “Not a Bear Among Them.” By “them” Barron ‘s meant institutional investors. I do vividly remember my Dad listening to the stock market wrap-ups on the kitchen radio nearly every night in 1973-74. It seemed to me back then that the stock market only went in one direction — and that was DOWN. The global economy is in disarray. It’s the legacy of the central planners at the central banks. China’s economy has been rapidly slowing despite all sorts of attempts by the government to prop it up (including extreme actions to hold up stocks). China’s economic slowdown has cratered commodity prices to multi-year lows and helped drive oil down to around $40 a barrel.

All the “commodity country” economies (and others) that relied on exports to China are suffering. Brazil is now in a deep recession. Last month Taiwan officially entered recession driven by double-digit declines (for five consecutive months) in exports. Also last month Japan officially reentered recession. Canada and South Korea’s governments recently cut forecasts for economic growth. Despite the lift from an extremely weak euro, Germany’s Federal Statistical Office reported last month that the economy slowed in Q3 due to weak exports and slack corporate investment. The German slowdown led a slide in the overall eurozone economy in Q3 per data from the European Union’s statistics agency. The recent immigration and terrorist problems make matters worse. Tourism will suffer.

Here in the U.S., the economy appears relatively healthier only because the rest of the world is so awful. That has driven the U.S. dollar skyward (DXY index over 100), hurting tourism and multinational companies exporting goods and services overseas. Last month the U.S. Agriculture Department forecast that U.S. farm incomes will plummet 38% this year to $56 billion – the lowest level since 2002.

http://www.zerohedge.com/news/2015-12-06/why-fred-hickey-these-are-last-gasps-dying-bull-market-and-economy

Jobs haven't grown much since 1999 or so, when cheap-to-extract, easy-to-sell-cheap-and-make-a-profit oil production was at its peak.

These Ain’t Your Grandfather’s “Jobs”

(David Stockman's Contra Corner)

This “Jobs Friday” ritual is getting truly absurd. So it can’t be repeated often enough: These artifacts of the BLS’ seasonally maladjusted, trend-cycle modeled, heavily imputed, endlessly crafted and five times revised “jobs” numbers have precious little to do with the real health of the main street economy. Indeed, the six-year run of job gains since early 2010 primarily represents “born-again jobs” and part-time gigs. In economic terms, they do not remotely resemble your grandfather’s industrial era economy when a “job” lasted 40 to 50 hours per week all year round; and most of what the BLS survey counted as “jobs” paid a living wage. Not now. Not even close.

The Wall Street fools who bought the dip still another time on Friday do not have the slightest clue that the US jobs market is actually quite dead. The chart below is also generated by the BLS but it measures actual labor hours employed, not job slots. It self-evidently puts the lie to the establishment survey fiction upon which the robo-machines and day traders are so slavishly focussed.

The fact is, labor hour inputs utilized by the US nonfarm business economy have “grown” at the microscopic annualized rate of 0.08% since the turn of the century. That’s as close as you can get to zero even by the standards of sell-side hair splitters, and it compares to a 2.02% CAGR during the 17 years period to Q3 2000. So let’s see. Prior to the era of full frontal money printing, labor utilization grew 25X faster than it has since the turn of the century. Yet the casino gamblers bought Friday’s more of the same jobs report hand-over-fist—-apparently on the premise that this giant monetary fraud is actually working. Not a chance. The contrast between the two periods shown in the chart could not be more dramatic. Nor do these contrasting trends encompass a mere short-term aberration.

The death of the US jobs market has been underway for a decade and one-half! Even in the establishment survey itself, the evidence of a failing jobs market is there if you separate the gigs and the low-end service jobs from the categories which represent more traditional full-pay, full-time employment. The latter includes energy and mining, construction, manufacturing, the white collar professions like architects, accountants and lawyers and the finance, insurance and real estate sectors. It also includes designers and engineers, information technology, transportation and warehousing and about 11 million full-time government employees outside of the education sector.

We have labeled this as the “breadwinner economy” because the work week averages just under 40 hours in these categories and annualized pay rates average just under $50k. These kinds of family supporting jobs were what the Labor Department bureaucrats had in mind back in the 1930s and 1940s when the current employment surveys and reports were originally fashioned.

Notwithstanding all of the present era crafting, however, even the BLS establishment survey figures leave no doubt about the retreat of breadwinner jobs.

http://davidstockmanscontracorner.com/these-aint-your-grandfathers-jobs-why-fridays-rip-should-be-sold/

The US Corporate Debt is going into the stratosphere again, just like it did... when? Oh, yeah. before the financial crisis of '08. And it's getting to be distressed, too, especially in the commodities sector and most particularly the oil and gas patch which holds one-third of distressed debts.  That might put a hamper on oil extraction when the distressed extraction companies fall into bankruptcy and might have to shut down.

US Corporate Debt Downgrades Reach $1 Trillion

(Financial Times)

More than $1tn in US corporate debt has been downgraded this year as defaults climb to post-crisis highs, underlining investor fears that the credit cycle has entered its final innings. The figures, which will be lifted by downgrades on Wednesday evening that stripped four of the largest US banks of coveted A level ratings, have unnerved credit investors already skittish from a pop in volatility and sharp swings in bond prices. Analysts with Standard & Poor’s, Moody’s and Fitch expect default rates to increase over the next 12 months, an inopportune time for Federal Reserve policymakers, who are expected to begin to tighten monetary policy in the coming weeks. S&P has cut its ratings on US bonds worth $1.04tn in the first 11 months of the year, a 72% jump from the entirety of 2014.

In contrast, upgrades have fallen to less than half a billion dollars, more than a third below last year’s total. The rating agency has more than 300 US companies on review for downgrade, twice the number of groups its analysts have identified for potential upgrade. “The credit cycle is long in the tooth by any standardised measure,” Bonnie Baha at DoubleLine Capital said. “The Fed’s quantitative easing programme helped to defer a default cycle and with the Fed poised to increase rates, that may be about to change.” Much of the decline in fundamentals has been linked to the significant slide in commodity prices, with failures in the energy and metals and mining industries making up a material part of the defaults recorded thus far, Diane Vazza, an analyst with S&P, said. “Those companies have been hit hard and will continue to be hit hard,” Ms Vazza noted. “Oil and gas is a third of distressed credits, that’s going to continue to be weak.”

Some 102 companies have defaulted since the year’s start, including 63 in the US. Only three companies in the country have retained a coveted triple A rating: ExxonMobil, Johnson & Johnson and Microsoft, with the oil major on review for possible downgrade. Portfolio managers and credit desks have already begun to push back at offerings seen as too risky as they continue a flight to quality. Bankers have had to offer steep discounts on several junk bond deals to fill order books, and some were caught off guard when Vodafone, the investment grade UK telecoms group, had to pull a debt sale after investors demanded greater protections. Bond prices, in turn, have slid. The yield on the Merrill Lynch high-yield US bond index, which moves inversely to its price, has shifted back up above 8%. For the lowest rung triple-C and lower rated groups, yields have hit their highest levels in six years.

http://www.ft.com/

Of course, OPEC isn't helping matters by cranking out oil extraction-production just as Iran is about to reenter the petroleum market due to lifting of sanctions against it.  And what will happen when sanctions will be lifted against Russia, as they eventually will? We're in Peak Oil Times, people, enjoy the low prices while you can! Problem is, debt is destroying demand. Just ask anyone who's over their heels in debt and can barely keep up.

OPEC Knocks Down Oil Majors

(Bloomberg Business)

For months, many executives at the world’s largest oil producers have been talking about prices staying lower for longer. After OPEC’s decision to keep pumping full pelt that could become lower for even longer. Even before Friday, the prolonged slump in crude had forced analysts to cut their earnings-per-share estimates for the world’s 10 largest integrated oil companies in recent weeks. With oil dropping to the lowest in more than six years after the OPEC meeting on Friday, further downgrades are probably on the way. “A potential OPEC cut was the last source of hope for the bulls near term,” Aneek Haq with Exane BNP Paribas said Dec. 4.

“The oil majors have already started to underperform the market over the past few weeks, but this now coupled with earnings downgrades and valuations that imply $70 a barrel should put further pressure on share prices.” Mean adjusted 2016 EPS estimates for Exxon Mobil and Shell have been cut by more than 8 cents over the past month, according to data compiled by Bloomberg. EPS projections for Total, Europe’s second-biggest oil company, and Repsol are lower for 2016 than those for this year. Those estimates assume a much higher price than the $41.06 a barrel that Brent traded at as of 8:19 a.m. in London on Tuesday. Oswald Clint at Sanford C. Bernstein has based his EPS estimates for oil majors at a Brent price of $60 a barrel. Alexandre Andlauer at AlphaValue SAS has assumed a price of $63.

“The re-rating of the oil companies downwards will accelerate now,” Andlauer said Dec. 7 by phone from Paris. “Valuations will have to drop.” Shell’s B shares, the most actively traded, dropped 4.6% on Monday, the most in more than three months. BP dropped 3.4%, while the benchmark FTSE 100 Index declined 0.2%. “The lower-for-longer scenario that oil companies are predicting is going to become lower-for-even-longer,” said Philipp Chladek, a London-based oil sector analyst with Bloomberg Intelligence. “We will see some revisions in EPS forecasts in the near future because most forecasts are assuming an oil price recovery during 2016. Many will be taking that out now.”

http://www.bloomberg.com/news/articles/2015-12-08/opec-takes-down-oil-majors-as-lower-for-even-longer-kicks-in

And none of the oil-exporting countries can blink because they have public welfare support systems to support.  And the oil and gas firms can't blink either because they have debt to service.

As Oil Keeps Falling, Nobody Is Blinking

(The Wall Street Journal.)

The standoff between major global energy producers that has created an oil glut is set to continue next year in full force, as much because of the U.S. as of OPEC. American shale drillers have only trimmed their pumping a little, and rising oil flows from the Gulf of Mexico are propping up U.S. production. The overall output of U.S. crude fell just 0.2% in September, the most recent monthly federal data available, and is down less than 3%, to 9.3 million barrels a day, from the peak in April. Some analysts see the potential for U.S. oil output to rise next year, even after Saudi Arabia and OPEC on Friday again declined to reduce their near-record production of crude. With no end in sight for the glut, U.S. oil closed on Friday below $40 a barrel for the second time this month.

The situation has surprised even seasoned oil traders. “It was anticipated that U.S. shale producers, the source of the explosive growth in supply in recent years, would be the first to fold,” Andrew Hall, CEO of commodities hedge fund Astenbeck Capital wrote in a Dec. 1 letter to investors reviewed by The Wall Street Journal. “But this hasn’t happened, at least not at the rate initially expected.” For the past year, U.S. oil companies have been kept afloat by hedges—financial contracts that locked in higher prices for their crude—as well as an infusion of capital from Wall Street in the first half of the year that helped them keep pumping even as oil prices continued to fall. The companies also slashed costs and developed better techniques to produce more crude and natural gas per well.

The opportunity for further productivity gains is waning, experts say, capital markets are closing and hedging contracts for most producers expire this year. These factors have led some analysts to predict that 2016 production could decline as much as 10%. But others predict rising oil output, in part because crude production is growing in the Gulf, where companies spent billions of dollars developing megaprojects that are now starting to produce oil. Just five years after the worst offshore spill in U.S. history shut down drilling there, companies are on track to pump about 10% more crude than they did in 2014. In September, they produced almost 1.7 million barrels a day, according to the latest federal data.

http://www.wsj.com/articles/as-oil-keeps-falling-nobody-is-blinking-1449446203

Conservative Blogger Loses It!

One of the unfortunate side effects of economic decline due to peak oil and a heavy debt overburden, is the increase in gun shootings, such as the Oregon shooting, the Bunny Friend Park shooting, the Planned Parenthood shooting in Colorado, and the Daesh-inspired (authorized? sponsored?) California shooting -- a newlywed couple gunning down coworkers who just threw them a baby shower! -- plus now this: A conservative blogger loses it so much over a New York Times front page editorial that he literally shoots it full of holes!

Source: The Hill.

Conservative blogger Erick Erickson has literally fired shots at a New York Times editorial that appeared on the front page of the paper Saturday.

“This is what I think of the New York Times editorial today,” Erickson posted on Instagram, with a photo of bulletholes through the editorial on gun laws. 

“The United States suffered it worst terrorist attacks since September 11 and the New York Times’ response it that all law-abiding citizens need their guns taken away,” Erickson added. “Screw them.”

http://thehill.com/blogs/blog-briefing-room/news/262223-erick-erickson-shows-bulletholes-nytimes 

There's a reason why the Grand Dame presented an editorial on the front page -- they're taking advantage of our gun-control laws, or the lack of them. These shootings won't stop and it won't just be just ISIS. Just about everyone with a few screws loose, an axe to grind and gun control loopholes to exploit will be doing this, more and more frequently.

I swear, this country is going crazier and crazier and the people in Washington are clueless. This is soooo NOT going to end well.  

Phytoplankton to Die Off if Seas Warm by 6 Degrees Celsius Due to Global Warming.

Report: The World Will Run out of Breathable Air Unless Carbon Is Cut

“As representatives from 195 nations gather in Paris to hammer out a global agreement to slash greenhouse gas emissions, a new study finds that the failure to do so could leave the world gasping for breath.

“Marine plants such as phytoplankton are estimated to produce more than half the Earth’s atmospheric oxygen, according to the National Oceanic and Atmospheric Administration. For the study, Sergei Petrovskii, an applied mathematics professor at the University of Leicester in the United Kingdom, calculated how unrestrained global warming could affect phytoplankton and thus the ocean’s ability to generate breathable air.”.

He found out that once the world’s oceans warmed by 6C (10F) the phytoplankton have a mass die-off, depriving us and other creatures of Oxygen with essentially zero warning.

http://news.yahoo.com/report-world-run-breathable-air-unless-carbon-cut-210604512.html