Economics And Oil

As I write this, a little after 2:00 AM, I am concerned… no, I’m petrified the U.S. financial markets will follow the rest of the world and plummet at today’s opening.

The global economy is totally interconnected. International markets fell Monday, while our stock exchange was closed. They’re falling again right now. The Dow could be down multiple hundreds of points right at the opening.

A full fledged crash is certainly possible, though I’d rather not think about it.

That’s really not what I wanted to write about, but since this will be about the international economy and oil, I thought I should acknowledge what’s going on.

Yesterday, I saw a story (in many places) about Israel’s commitment to build an electric car. Here in the states a fully electric vehicle will be out from GM in just a few years. These are fully electric cars, not hybrids.

It makes a lot of sense, because at $100 a barrel, alternative fuels become competitive with oil. Except, $100 a barrel is a totally artificial price.

Yes, there’s some supply and demand at work, but oil’s price is steered by a cartel. They control the supply to control the demand to control the price.

OPEC is not a monolith. The oil producing nations aren’t exactly in lock step. They’re close enough.

That being said, the actual cost to produce a barrel of oil is a lot less than the selling price. What it costs differs by location, but here’s what the Energy Information Administration, a US government agency, says.

In 2006, average production costs (or “lifting” costs, the cost to bring a barrel of oil to the surface) ranged from about $4 per barrel (excluding taxes) in Africa to about $8.30 per barrel in Canada; the average for the U.S. was $6.83/barrel (an increase of 23% over the $5.56/barrel cost in 2005). Besides the direct costs associated with removing the oil from the ground, substantial costs are incurred to explore for and develop oil fields (called “finding” costs), and these also vary substantially by region. Averaged over 2004, 2005 and 2006, finding costs ranged from about $5.26/barrel in the Middle East1 to $63.71/barrel for U.S. offshore.

Forget the $63.71 figure, because it represents a small portion of what’s being produced. By and large, most of the world’s oil is found and removed at $10-$20 per barrel. Obviously, the oil exporting nations are getting rich and their selling price has little to do with their actual cost.

However, in the face of competition from alternative energy (think electric cars) they can and will reevaluate their price, settling for less in the short run to guarantee a continuing market for their products.

Oil exporters don’t want coal, solar, nuclear, or whatever else can be thought up, to kill their business. That leaves us with tough decisions.

Do we want energy independence and, if so, at what cost?

My feeling is, we need to be independent and must be willing to make short term economic sacrifices to establish an energy beachhead. In the long term, an economically weakened OPEC, which can no longer run roughshod over energy prices, is in our best interest.

It won’t be easy. At some point, whether through consumer persistence or governmental subsidy, we’re going to have to endure short term pain in order to free ourselves. OPEC will do their best to temp us by cutting their prices. And, as has always been the case, more oil will be found to quench the world’s growing thirst.

Will we continue to look to alternatives if oil returns to a ‘reasonable’ price? There’s certainly lots of fudge factor in what they’re getting now.

I hope we can resist their temptation.

Now It’s The Hurricane Season

My friend Bob, the meteorology professor, just sent me an email with not much more than this link. Half past midnight on Saturday. He knew I’d be checking the mail.

The Atlantic is open. Hurricane season has begun – even with no Atlantic hurricanes.

Yes, I know the season’s officially underway June 1. That’s minor league stuff. The real hurricane season is squeezed in from the middle of August to the middle of September.

For the past few days the GFS (a physics based, dynamic weather model) has been showing a strong, hurricane like storm, moving off the coast of Africa heading toward the states.

The GFS is not made to predict tropical weather, and it does so poorly. Still, when run-after-run shows the same thing, you look. They have at the Hurricane Center.

A VIGOROUS TROPICAL WAVE IS LOCATED OVER THE FAR EASTERN ATLANTIC OCEAN ABOUT 300 MILES SOUTHEAST OF THE SOUTHERNMOST CAPE VERDE ISLANDS. SHOWERS AND THUNDERSTORMS HAVE CHANGED LITTLE IN ORGANIZATION THIS EVENING. HOWEVER…CONDITIONS APPEAR FAVORABLE FOR GRADUAL DEVELOPMENT OF THIS SYSTEM…AND A TROPICAL DEPRESSION COULD FORM DURING THE NEXT DAY OR TWO AS IT MOVES WESTWARD AT 15 TO 20 MPH.

Bob’s impressive model outputs are of the same storm, what looks to soon be Dean. These maps are different from my normal charts, but the bottom line’s the same.

Though I said the GFS has been forecasting this storm, it hasn’t been consistent with the long range path. A few days ago it took a sharp right, missing Florida and sailing close to shore, but off the East Coast. Another run had the storm moving into the Gulf and making landfall between Galveston and New Orleans. That’s a pretty big difference!

Obviously, we don’t have a clue yet, except this looks like Dean. And, it looks like Dean will be strong.

The next month will be busy.

Unreal Photo

This is one of the finest photos I’ve ever seen. Nearly everything about this photograph is perfect.

Please look at the larger image. The thumbnail on this page doesn’t do it justice.

I don’t know the photographer, Michael Poliza, except to say he is a professional and this shot is part of a book on Africa. There is an amazing amount of technique and know-how here. Under the same conditions, I probably wouldn’t come back with anything like this.

I’m not sure which I’d like more – to go to Africa or to shoot like this guy?

Which Storm Is Next?

Tropical Storm Lee came and went in an instant. There’s a Tropical Depression in the Atlantic that will probably be Maria. It’s in a place that doesn’t favor a North American threat.

Next would be Nate.

There is a chunk of moisture with thunderstorms popping up in the Eastern Atlantic. It is very far away. The Hurricane Center has not seen fit to give it a name or track it in any but the most basic way. It’s a possibility for Nate.

Earlier tonight, my friend Bob, the hurricane expert (PhD and teaching position in meteorology at a fine large university), said this blob of cloudiness deserved watching… and so I have joined its observers.

These small clusters of thunderstorms pop up off the west coast of Africa all the time during this part of the hurricane season. Hurricane birth is very much a movable feast. There are different climatologically favored areas, depending on the time of year.

Most of them collapse under their own weight. Only a few grow.

Even when they grow, there’s a good chance they’ll be like Lee – far away from people and not very long lived. There are many more Lees than there are Katrinas.

Hurricanes are difficult to predict. A lot of that has to do with the very light steering winds they encounter. A mile or two per hour or the change of a few degrees in wind direction make a big difference in where a hurricane will move over an extended length of time.

Then there’s the water temperature. Have we accurately observed what it is… or have we been fooled (because satellites, radar and our other tools aren’t quite as good as the general public thinks they are when a system’s very far from ground based instruments)?

Hurricanes are also compact systems. They’re too small to be easily or accurately picked up by the conventional computer models we use. And, we need dates far in the future for something closer to Africa than America. Our errors are multiplied with time.

After all that, knowing we’ll mostly be wrong, we look anyway. We often chatter among ourselves over these left field predictons. I’m not entirely sure why.

I’m attaching part of a computer model which picks up this pre-Nate cluster, allows the storm to engorge itself on warm, tropical, Atlantic water until it reaches hurricane strength, and then curves it up the East Coast.

I don’t believe it is true. I don’t think this forecast will happen. But, it’s all we have right now. It’s what the geeky boys are currently talking about

Will there be a Nate and will he be right off the New England coast Tuesday, September 13, 2005 at 8:00 PM EDT (9/14/2005 0000Z) as this maps shows? Stay tuned.

Stranger things have happened.

The Rest of Our Philadelphia Trip

One of the prime reasons for going to Philadelphia was to go the see a Phillies game at Citizens Bank Park.

Before we go on, let me say how displeased I am with naming rights to stadiums and arenas. It’s a shame there’s no longer a Veteran’s Stadium in Philadelphia or Oakdale Theater near me in Wallingford, CT. Maybe there is a benefit to me by having Citizens Bank or Chevy (in the case of the Oakdale Theater) kick in some cash… though I don’t see it.

I am tilting at windmills. It’s never going back.

My friend Peter picked us up at the hotel and it didn’t take long to drive to South Philly and the stadium. Citizens Bank Park, Lincoln Financial Field and the Core State Arena (it’s hurting me to write this) are all located on the same tract of land that held the Vet, Franklin Field and the Spectrum (still there, but now with a corporate name preceding the word Spectrum).

I paid the $10 to park and we found a space fairly close to the entrance. Helaine had bought four tickets from a broker – though they were only marked up $4. We walked into the stadium.

Since this was my birthday trip, Helaine had arranged for my name and age to be flashed on the scoreboard with the other 11 year olds. We went and signed in. There was a charge, but I got a very nice Phillies hat.

The ballpark itself is a very nice place. Whereas the Vet was all concrete and steel with no thought of aesthetics, there’s lots of exposed brick and other warm touches now. And, Vet Stadium’s turf – possibly the worst playing surface in all of professional sports, has been replaced by beautiful real grass.

Beyond the outfield is a huge food court – Ashburn’s Alley. That’s where we headed first.

Steffie wanted to have a genuine Philly Cheesesteak, and Geno’s of South Philadelphia fame is represented. This is not ‘old school’ baseball food. It wasn’t soggy. It was hot. It was delicious. We found a place to sit and ate our lunch.

The game was scheduled for 3:15, so we headed down and took our seats. I was surprised that there had been no hassle when I brought my camera and two lenses in. The Phillies web site said it would be OK, but I had a sneaking suspicion there would be scrutiny over any camera with a removable lens.

These were probably the best baseball seats I’d ever had. We were behind the Phillies dugout, in the sun, 25 rows from the field. We were in foul ball territory. We were very close to the action.

The Phils were playing the San Diego Padres… and the Phils had gotten hot! The night before, Chase Utley ended the game with a walk off homer. Is there a more macho act?

For us, the game began slowly. It seemed like Robinson Tejeda, the Phillie starter wasn’t in control. I say ‘seemed’, because when you see the box score, you see a pitcher totally dominating the opposition. It’s funny how those two elements don’t always match up.

I took a lot of pictures at the game. Some might say I took too many pictures. Here’s my favorite, Bobby Abreu ducking out of the way of a Pedro Astascio fastball. Judging by the catcher’s glove, this pitch was traveling where it was aimed.

We stayed until the very last out, anticipated the worst when Real Cormier was called in, but getting a one inning gem instead. Billy Wagner picked up the save.

After a short stop back at the hotel, the four of us (Peter included) went out searching for dinner and the sights. We hit South Street first, but realizing that wasn’t the right spot for dinner, headed to Market Street and the Penn’s Landing area.

Again, we found Italian food. Again, it was very good. But we were very tired.

Our walk back to the hotel was uneventful, but left me uneasy. There were too many places which seemed sinister.

Tonight, I sent an email message to Mayor Street. It’s attached to the link at the bottom of this entry. Whether this kind of message makes any difference or not is beyond me, but I am always willing to write and make my opinions felt.

We finished up our stay Sunday with brunch on the Moshulu.

Since the launching of the Moshulu (pronounced Mo-shoe’-loo) in 1904, she has had a long and exciting career on the seas working the ports of Europe, South America, Australia, America and Africa. She was confiscated by the Americans in one war and by the Germans in the next. She has traveled around Cape Horn 54 times. She has hauled coal and coke, copper ore and nitrate, lumber and grain. In lesser days, she has served as a floating warehouse. In grander days, she won the last great grain race in 1939. Today, the Moshulu is the largest four-masted sailing ship in the world still afloat.

I once heard someone say you should never go out to dinner at a revolving restaurant. I think the same applies to converted sailing ships. The food was OK – nothing special. The ship was OK too… but just OK.

The interior of the ship was larger than I expected. I know that because of the schlep from our table to the buffet!

By 1:30 we were heading home. We headed north on I-95, over the Delaware via the Betsy Ross Bridge (A white elephant when it was built, I hope it’s more useful now), Route 90 to Route 73 to I-295 and then the New Jersey Turnpike.

We waited as long as we could before getting off I-295 and onto the Turnpike. It made no difference. We were stuck in stop-and-go traffic for the better part of an hour before things opened up. The rest of the trip was uneventful.

Oh – there was that sign on the George Washington Bridge that I captured. I’m hoping it’s legal to take photos before you get to the sign, as I did.

So, what have we learned? We were surprised and pleased that Steffie enjoyed the game. Yes, she got a shirt and excellent junk food… but she bought another shirt with her own money and seemed to be interested in the game.

We also enjoyed visiting Philadelphia, the place where we met 25 years ago, as tourists. There are rough edges that need to be smoothed for Philadelphia to become a better tourist destination, but so much is in place right now.

Continue reading “The Rest of Our Philadelphia Trip”

Having a Blog – The Fringe Benefits

I like writing in my blog. Hopefully, that’s obvious. Whether anyone reads it or not, it’s an opportunity to vent and reflect. There are, unfortunately, far too few places to do either.

A side benefit of having a blog is the web presence it gives me. Do a Google search for Geoff Fox and you’ll find me first, even though there are other Geoff Foxes – most more accomplished than I am.

Once you’ve found the website, getting in touch with me by email is simple. From time-to-time I get a note from someone I knew a long time ago who stumbled across this site. One came in tonight.

Actually, I’m lucky I found the note from Dave Kulka, because it was in my spam box, snuggled between herbal Viagra and mortgage offers&#185.

David Kulka here. Geoff, how the hell are you? We haven’t spoken in a

long time. I was sifting through DX artifacts and other memorabilia

from the past and came across a batch of old letters from you. You

were certainly easy to find on Google.

Email seems insufficient for catching up after 30 years, why don’t you

give me a call. 818-xxx-xxxx.

73’s

David

He’s David now, but I first met Dave Kulka in person in August 1968. We had met through correspondence and a mutual hobby, broadcast band DX’ing&#178, months earlier.

I had just turned 18. Dave was a few years younger. We planned on meeting for the National Radio Club convention in Los Angeles, visiting another radio nerd in Riverside, CA and spending some time at Dave’s house in Marin County, just outside San Fransisco.

This was my first time away from home by myself. I was flying cross country to meet a stranger. Who knew what he’d be like?

At 18, I was naive. There was never a question of fear or worry. I remember getting some incredible 1/2 price youth fare on TWA and flying from Kennedy Airport to Los Angeles.

There’s not a lot I remember, though a few individual events stand out.

The convention was held in an older, somewhat worn, hotel in Hollywood. I believe it was the Roosevelt, but I might be wrong. Within an hour of being in LA and checking into the hotel, I got myself arrested for jaywalking at Hollywood and Cahuenga! I think Dave got pinched too.

When we went to the desert in Riverside, it was as foreign a place as I’d ever been. I remember how bare the ground was, and how we were fairly close to a bluff which overlooked Riverside Airport. I went there a few times to watch the Hughes Air West Fairchild F-27’s takeoff and land

One day while we were in the house in Riverside, everything began to shake. I could hear plates and glasses rattling. Earthquake! It scared the living daylights out of me… though Dave and the home’s owner, Don, made like it was nothing. To this day, it’s my one and only earthquake.

Spending time in Marin County was also an eye opening experience. Dave and his family lived in a beautiful home on the side of a hill. There was a deck which ran from the side to the back. His parents cars were parked on the narrow road in front of the house. Their auto registration was somehow affixed to the steering post. Having grown up in apartment 5E, this was all culture shock.

I remember Dave’s mom. I couldn’t pick her out of a crowd today, but I remember thinking she was pretty and young for the mom of a contemporary. Mostly I remember her during the days of the 1968 Democratic Convention in Chicago.

This was the convention where Mayor Daley attempted to quash the dissent of the anti-war movement. There were riots in Chicago during the convention. It was all televised live.

Dave’s mom cried. It was a soft, emotional cry. Over 35 years later, that moment is strong in my mind. I remember her standing there, turned 3/4 away from the TV, in an emotional state because of something going on half a country away.

I didn’t understand the significance of what was going on at the time. Dave didn’t either. But her emotion from that night is still strong in my mind.

Dave’s uncle, Leo deGar Kulka, was the proprietor of a well known recording studio in San Fransisco. We spent a lot of time there, though I never met Uncle Leo.

Like I said, Dave could have been a weirdo – who knew? I was going out there on blind faith. But, he turned out to be a nice guy, and it was a trip which still stands out in my mind.

Tonight, on my way home from work, I called him and we spoke for a while. He has had an amazing life, traveling through much of Asia. These were not tourist jaunts to capitols, but trips through the countryside – places where Anglos are oddities. That kind of world traveling is one thing I’ve wanted to, but never will, do.

He sounds bright, self assured and content. On the phone I told him he sounded happy with his life, but I think content is a much more fitting word.

Dave’s in Burbank, in the San Fernando Valley, designing and installing recording studios. He is married with no children.

We get out there every once in a while. Next time, I’ll have to see him. How much could he have changed in 36 years?

&#185 – I always hope I find all the non-spam in my spam box, but, as good as popfile is, I am never sure. The downside to having a website like this is the amazing amount of spam I receive – hundreds of pieces every day.

&#178 – Broadcast band DXing is a hobby where you try and listen to distant, often foreign, broadcast stations on the regular AM dial. Using sophisticated, incredibly nerdy equipment, I was able to hear Europe, Hawaii, even Africa on an AM radio from the East Coast. I haven’t been involved in years, but still know the calls of most of the dominant clear channel stations and many of the strong regionals.