Monday, May 3, 2010

pre-post-capitalism . . . .

I was reading a fascinating article by Chris Martenson on how to turn an investment profit as the fossil-fuel age collapses.  He makes the case that there are boatloads of money to be made in the energy sector, but you'd better have cashed out by the time the shit really hits the fan.

My advice to investors dreaming of windfall profits from $500/barrel crude oil futures would be this: Pretend it’s 1940 and you have a magic crystal ball that tells you in advance that the United States will be drawn into World War II. You might start to speculate that by investing in rubber, airplane parts, materials needed to make bombs, and so forth you’ll make a killing. Those products will become so important and so valuable that you might presume you’ll be able to name your price and demand any amount you like for them. But of course you’d have been mistaken. World War II wasn’t a routine macroeconomic event. It was a game changer. Laws were re-written, often retroactively. A state of national emergency was declared and people in possession of materials essential to the war effort were ordered to hand them over as price controls were implemented to thwart profiteering from speculation on the supply needs of the war effort . . . I contend that any Peak Cheap Oil investment strategy that fails to consider government intervention scenarios is flawed and likely to underperform. That’s not to say that there’s no money to be made from an early awareness of peak cheap oil. 

The whole article is a thought-provoking glimpse into an alternate universe where the heroes of Late Capitalism (or Pre-Post Capitalism) face Ragnarok like fleas who are timing their leap from off the hairy back of Fenrir and calling that a savvy investment strategy.

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