Dollar Rejection is Why America Ramped Up Oil and Gas Production – Rob Kirby

Mark James 09/29/2019  •

Great interview! Rob Kirby looks very well after all he went through!!

I have a serious question. I understand “burning money” when $7 Trillion is wasted on wars which create no “future economic value.” But if gas is being sold at a loss (as he proved – sale price < production cost), isn't that a benefit (discount) to the end buyer – whether that buyer be here or abroad? So is Rob Kirby's argument that businesses, consumers, producers, etc do NOT have inflation because the cost of creating their goods / providing services is decreased because of the offset of cheap cost of energy? So basically, they don't need to increase the cost of their goods or services because of cheap energy? So, let's say labor costs (or other costs) are rising, it is offset by the cheap energy that is mass produced (for no purpose than to keep money flowing)?

My point is that, unlike wars, the gas is eventually used — not necessarily wasted (like bombs or crashed tanks / planes). If they were burning oil fields or literally releasing gas (or burning off the gas) to no economic benefit, that is money flowing out of the economic structure. Instead, it is going back into the economy. The way I could see it benefiting (although, as Rob Kirby says…. makes no sense) is by offsetting rising costs.

Am I going in the right direction here?

Thank you! Very thought provoking and interesting analysis!!! Maybe I need to watch his interview again.

Fredrick (Rick) Getzschman 09/29/2019  •

Rob and Greg you are right on the money. President Trump is surrounded by scum bags, they are going to continue to keep Donald Trump in the dark, his cabinet and government employees will continue to leak like a sieve and the problem the United States is facing is since 1913 there has been no lawful money of account. The federal reserve is a well crafted slave plantation scam and it’s been over for the federal reserve for a long time now. They have kept the fiat dollar alive by gimmicks that are running out for their economic scam. The truth is the United States has no laws in effect, it’s a pirates ship of Official Pirates, my term for Officialdom is accurate in that Public Officials and Public Employees are “Pirates of the United States Constitution and Bill of Rights”. The whole nation is operated on contracts and some contracts will be enforced if it benefits Officialdom and their pirate federal reserve system. Every State Governor is the head pirate in each State, it does not matter what private political party they belong to, US politicians are scum of the earth, the child trafficking, human trafficking, child stealing is operated by the Feds and Statees is just one racket of many. The whole dollar system is fiat currency of no account is lawless. The fiat dollar printed on demand or burned in a barrel is not lawful money of account, it is a debt instrument enforced at the barrel of a gun in all fifty states by the so-called courts, enforced all around the world by the US Military, that is why there are near 800 US Military bases around the world, to enforce the dollar on behalf of the federal reserve banks and US Politicians. The United States is suffering the rejection of the dollar for many reasons, one reason is the United States contracts are no good, worthless contracts and now everybody around the world has enough experience with US Officialdom to know they are no good, the fiat dollar is no good and the majority of the world is moving on and using currencies that are reliable, redeemable and of account. The only thing US Politicians are good at is crime against the people, waste, fraud, abuse, child stealing and lying every time they open their pie hole and spit out their latest lie, scam, fraud or whatever they are spewing. The problem that Officialdom has is that now a large majority of the US population acts like US Politicians, monkey see, monkey do. You can not expect much when the entire governmental system is lawless and they have done that willfully, knowingly and voluntarily. The Statees are out cremating human remains against the will of parents, creating fictitious obligations with the help of the Feds along with kidnapping, sponsoring kidnapping, forced and un-authorized enlistments of children into the United States Military, getting children to waive their rights by US Military legal departments getting recruits to sign away their rights by trick and schemes of Official frauds. All these crimes are occurring because there is no law in effect in the United States, the entire government is being operated on “emergency rule”, the emergency is the US Government has no lawful money of account and they have no law. That is the US emergency, printing federal reserve notes is a temporary gimmick that has been in use since 1913 when Congress gave away their authority to private bankers. Congress has no power, they gave away their power by contract to the private federal reserve bankers (the power to issue currency and regulate the value thereof ), that is why Congress and the Senate is packed with incompetent politicians and bar association attorneys. All you have to do is observe the above for yourself to see what is going on. Those private bankers as owners are making all the decisions and US politicians are the water boy / water girl carrying out the decisions made by the owners to the masses of Americans who will suck it up and consume those messages from the private banker owners. As more Americans awaken from their stupor, the worse conditions will get in the US. By the time a critical mass of 3% of Americans awaken to the scale of the crimes by Officials masquerading as Officialdom, when the big shift in consciousness occurs you will know when you see Washington DC is abandoned, the State houses abandoned, sitting empty while the whole control structure collapses. The outfits styled as “law enforcement” are not allowed to enforce the law, they have been limited by their owners the private bankers, private bar associations and other public pretenders to revenue raising schemes, cover ups on behalf of corrupt US officials, Corrupt Bankers, Corrupt Government Employees and mass arrests for use by corporations in slave labor camps styled as US Prisons and State Prisons, slave labor is what 85% of the US Prison population exists for that purpose alone. You might have the other 15% of the US Prison population as actual convicts of common law crimes and in that 15% is the medical cases of sociopaths and psychopaths, a group of people who did not make it into a US political office before they committed their crimes, they didn’t get their position as a banker, judge, attorney, ceo or whatever before securing an office that flies under the banner of “too big to jail” “too big too fail” , had that 15% waited to secure an office first they would not be in prison today. True story. One thing for sure for the US is we can see the decay, the collapse everyday, look at the degeneracy of the nation and those people are a mirror image of their so called leaders. The fracking business is to help paper over the loss of the international states rejecting the worthless federal reserve note debts. Public Official Corruption in the United States is massive in scope and massive in nature as the three bubbles begin to pop in real estate, automotive, stocks/bonds, insurance and Government, they will not be able to print enough money to cover it up, even with Warren Buffet and his cronies in Omaha, Nebraska in Turdshire Castaway. Public Official Corruption in the United States along with other corrupt officials has infected the general population with their lawless rackets, fiat currency, human trafficking, corrupt scummy government religious corporations, dirt bag bar association attorneys, the importation and encouragement of illegal drug use and other crimes against the families and their hatred of American families are just a glimpse of the crimes occurring in the State occupied courthouses (formerly known as county courthouses). My prediction is the corrupt officials will all flee when the big ship of state goes down and they no longer can hide behind the government corporate shield of limited liability, those famous Official capacity defenses without standing, those public pretenders in black dresses will run out and corrupt law enforcement will burn their uniforms when their revenue schemes are no longer feasible or profitable for their corporations. But hey I am just a man in a flyover State.

William Stanley 09/29/2019  •

Mr. Hunter,
My take is that Mr. Kirby has most of this right, but part of it not exactly right.
(1) Of course he is right that we can no longer trust financial reporting in either the public or private sectors. As John Williams has pointed out, American inflation and jobs numbers systematically hide the ongoing Great Recession by understating inflation and overstating the health of the jobs market. However, IMO, although American institutions are a large part of that problem, they are not the only offenders. For example, does anyone trust the numbers coming out of China?
(2) Mr. Kirby clearly is right that there is something awry about the continued flow of lending into the loss-making American gas and oil fracking sector. However, that looks to me to be a joint operation between the US Treasury and the Fed: I suspect that Treasury is pressuring the Fed to encourage lending into that sector in order to maintain US oil and gas output and, as a result, to suppress not only oil and gas prices, but the fall of the dollar relative to other currencies.
The problem with that is threefold (at least): (a) doing so hobbles the ability of American manufacturing to sell into the world market, (b) the banks are (potentially) on the hook for the eventual defaults on those loans and, (c) when it stops, consumers will be hit with big price increases for oil and gas.
I suspect that there is likely an understanding that the cooperating banks will be bailed out when their loans to the fracking industry are (finally) recognized as permanently under water. Otherwise, the banks would not be lending them so much money.
(3) Mr. Kirby correctly notes the (presently) overseas dollars “are looking for a home.” My suspicion is that such money is flowing into US financial markets — thus buoying their prices — and ending up in US bank balances. Hence the continued low velocity of money. (Low velocity mathematically implies high holdings of money balances (a stock) relative to nominal GDP, which is a flow of money).
Most of that money resides in deposits at banks. Thus, potentially, banks actually do have quite a lot of money on hand to grease the gears of the real economy. The problem is that the overall economy is lousy and the gears aren’t turning very fast. My guess is that that fact is being obscured by the false data regarding inflation and employment and the fact that the money is being created and lent to uneconomic, loss-making enterprises such as fracking, to consumers (which partly shows up as credit card balances), and to governments to cover fiscal deficits. As the (still denied) bad/impaired loans pile up, the banks tell us that there is a shortage of liquidity, hence the purported “need” for the recent huge upsurge in overnight lending to banks.
(4) My disagreement with Mr. Kirby is about why inflation does not seem to be afoot. He thinks the money flowing into loss-making enterprises disappears. IMO, he would be right about that IF the loans to those enterprises were extinguished via defaults on the loans. However, so far the frackers have not defaulted and that money continues to flow back into the economy via the frackers’ business expenditures. Therefore, I suspect the lack of apparent inflation is only apparent . . . and Mr. John Williams is correct about the statistics. All that said, the bottom line is the same: pain is coming.

Arthur Barnes 09/29/2019  •

Greg, Mr. Kirby clearly states a case of bleak for America. Looking over the politics of the country at present with economics aside leaves one to wonder just how this Country can do anything but go down in stature. Now add Mr. Kirby’s economic theory in the mix and you get an explosive mixture of gasoline and fire. I predict a civil war is coming, we are experiencing a “cold” civil political war at present with a hot one to come soon after the demogods take power & create their banana republic they long for. Should our President be impeached based upon political made up facts from spys of the CIA inside the Whitehouse could well spark the civil unrest. I, for one, will go to the streets and protest. Question is: Will any of You?

paul ... 09/29/2019  •

This is interesting … we have Russia acting like the US (asking NATO to ban missile deployment) … and NATO acting like Iran (rejecting the Russian request) … seems warmongers (wherever they are located) act the same … https://www.zerohedge.com/geopolitical/nato-rejects-putins-request-ban-missile-deployments-europe

TJZ 09/29/2019  •

Greg,

I have a different take on the above. Unlike 2008, when the U.S. issued TARP facility to underpin the bankrupt banks, we now have the the fed quietly funneling funds into the repo market for the same purpose. Again bank bail outs are occurring, inclusive of foreign banks, to prevent a collapse of the banking system, including our non collateral deposits. The same inter-bank refusal to lend is occurring!
In a multi-polar and collapsing world economy, how else is the U.S. to protect itself without producing oil/natural gas, even at a loss?
As for the U.S. printing of currency, how about China, Europe, etc? This constant pointing at the U.S. as if we are the only money printing culprits is ridiculous!
Best wishes

Jallen 09/29/2019  •

Greg,
WOW, What an interview, do I dare say maybe your best. Forewarned is forearmed, America’s days are numbered financially speaking. When will the people responsible for rigging the metals markets be put in jail? So these clowns invade Iraq because Saddam Hussein wants to sell his oil in non dollars, so we invade his country and kill him, as this is the first nail in Henry Kissinger’s Petro dollar. How about that evil Hillary and what she had done to Omar Khadaffi because he put his country on the GOLD standard and bypassed the dollar. We now know the weak spot of these clowns running America. I hope the boys at the GOLDMAN SACHS are shaking in their boots. When the SWIFT system collapses so will America as we know it as it will be the death knoll of the Almighty Dollar. A word to the wise, DIVERSIFY and protect yourself from the collapse of the almighty dollar. The boys are suppressing the price of Gold and Silver, take advantage of it. AGAIN, Greg this maybe the most important interview you have had to date as you are doing a public service awaking AMERICANS TO THE DEMISE OF THE DOLLAR. HATS OFF TO ROB KIRBY AND HIS MOST INFORMATIVE INTERVIEW AND HATS OFF TO GREG FOR SUCH A FIRST CLASS JOB INTERVIEWING ROB.

Jallen

joe 09/29/2019  •

https://kunstler.com/clusterfuck-nation/the-g-7-blues/
Howard Kunstler often writes of the shale oil debacle

Roacheforque 09/29/2019  •

I think that Rob is correct with regard to the overall observation that the US shale fracking industry is, always has been, and always will be, a non-profit, money losing operation. Add to that, Trump’s boasting about the miracle of US energy production and one can see how he’d assume Trump is misguided. But then, being the Crown Prince of bankrupt ventures isn’t necessarily a top resume item for presidential hopefuls (ask Wilbur Ross about it). In the “derivative world” that Rob understands, indeed everything is upside down, because it has to be – to support the dollar.
I do think that Alasdair MacLeod’s analysis of the specific repo market early warning signal is spot on (as usual) and as pointed out by AndrewB. It was written Friday, just 2 days after my article was written, and I missed it (due to a flurry of other activities) and probably would have never seen it if not for his link above.
My article, written last Wednesday, is here:
https://roacheforque.blogspot.com/2019/09/it-has-begun.html

Stan 09/29/2019  •

BTW, this will be an amazing week to short Gold. My timing model is calling for a huge down spike. You Gold Bugs are going to be hurting.

unext 09/30/2019  •

For whom does the bell toll? It tolls for thee
By Jim W. Dean, Managing Editor -August 25, 2019
…from the Association for Defending Victims of Terrorism (ADVT)

[ Editor’s Note: VT has worked with the ADVT for a number of years, starting after we learned that Iran had 16,000 terror victim families.
And the worst of that was yet to come. We discovered that the US and Israel supported the Iranian opposition MEK terror cult, which had been responsible for 12,000 of those deaths, including 70 high ranking members of the Islamic Republican Party, along with a Chief Justice.
https://www.veteranstoday.com/2019/08/25/for-whom-does-the-bell-toll-it-tolls-for-thee/

Justn Observer 09/30/2019  •

Greg, Interesting point of view from Mr. Kirby…as are others depending on their location around the globe. Much does seem to be tied to ‘energy’ …in one form or another.
GW seems focused on the deep state’s preoccupation with ‘black market’ corralling the nuclear fuel rod market. using the ‘anti-fossil fuel meme’ to push toward their goal of be the provider of a’SMART METERed’ energy system with the added ‘benefit’ of it being a ‘contol’ mechanism. (So Brzezinski-Kissinger-Soros of them!)
Other nations having an abundance of fossil fuel wish to get ‘their’ product to market. (Iran, Iraq, Venezuela, the Genie Energy /Golan Heights, Canada Tar Sands, and those countries setting up corridors for pipelines.)
Other countries have exports and interests in other commodities with some countries having overlapping interests ie. gold, silver, mined metals ie. Switzerland as Mr, Greyerz mentions refines and handles 70% of Gold , Canada has substantial interests in oil and mining, as does other South American countries and Africa.
All NEED to sell exports to off-set their balance of trade accounts and provide ‘wealth’ for their nations… The U.S. might have and is rightly hoping to do with oil what many other nations do…ie. subsidize there exports to do the same as a means to be ‘less’ dependent on ‘nations that do not like the U.S. too much and have used oil prices as a weapon (OPEC) which currently POTUS is hoping to avoid and keep from being an ‘enforcer’ of the oil spigot for others in Europe more reliant on their ‘neighbors’ (so much for the ‘good fence’ policy?.
This comes at a time that like other nations, the U.S. the lack of ‘audits’ as to actual PM reserves held on account ….JUST AS….the lack of transparent ‘AUDITS’ of just how much oil is still in the oil fields…as some nations seem to favor ‘slant’ drilling and over taking adjacent territory – ah humm? An why some nation supposedly awash in oil are so headlong for building so many nuclear reactor, like Iran and Saudi Arabia? (Needs for running massive de-salination plants) while others build and fill the sky with old coal fired generation plants as an other nation pays some guys – ah hum, $1.5 Billion paydays for ?
Then too – since so much is dependent on ‘energy’ = mining, farming, heating …with the latter causing a decided shift due to the weather …which is NOT as apparent over all…but the shift of it from differing regions… some cooler- others warmer – others dryer -others more wet = the irrational none settled- settled argument on ‘climate change’ which is more a shift then change…due to the stupidity of those like Al Gore. and the deliberate obscuration by others while Policy changes have been under way for some time…so as to manage risk and unmanageable alarm and yes, others who wish to take advantage of the ‘cycles’ which I believe Mr. Nenner is trying to get a handle on as to confirmation and implementation of what some nations perceive IS happening cyclically.
Clearly one can see substantial shifts to ‘needs’ from ‘wants’ , and dramatic reallocations due to the ‘unmanageable’ effects of the sun, its spots, the solar wind disturbance…and the shear magnitude of the size of the sun in relation to the earth and its outbound direction for a time. That causing shifts in ‘needs’ and the production of those ‘needs’ as to locations and access to them…and the stress of the timeline of the shift in relation to the populations.
We are entering a time of ‘cooperation’ NOT ‘confrontation’ and POTUS Trump is intellectually aware of this…even though the ‘idiots’ and neo-cons can not think past their deeply embedded psychosis and terminally blind philosophy of dealing with reality. I sense this is getting long so will only say…get a map and a protractor…put a circle around how far you would care to travel or expect needs for life to be fulfilled during the ‘current and impending’ climate changes…and possible disruption of delivery systems or sources. Ask yourself…why is Russia’s focus on the Mediterranean ? Why did China build those Ghost cities? What is grown where and where it is now NOT? and where is energy more and NOT? and how much $$$$ is needed to shift from what to where? all while the insurance companies are being overwhelmed the obvious. How many times will people ‘rebuild’ or ‘replant’ until they realize or ‘get’ the message! That said, some would think plucking mangos , avocados drinking margaritas or Mai Thai’s and catching a tan beats the heck out of dancing with a snow shovel… Personally-am thinking those migrating north are going the wrong direction. They might consider reading more Paleo – climatology. Take a bowl with a line around the side, and put a dot on it, fill it to the line – tip the bowl 21degrees as you spin it slowly…is the surface of the water rising or is the dot in rising and lowering in relation to it? Plant two pans sprouts, one with a glow light at the optimal distance…the other at a distance in relation to the sun being 1 million miles further away… THE TIMES – THEY ARE A CHANGING ! and that same TIME for meaningful decisions and CALLS for a possible locations change is running short…or…you can PUT it off… RISK on or RISK off…
It is 9/30 /2019 – one of my neighbors will be disappointed when the sun comes up, another other will smile . One a gardener the other an elk hunter…it snowed here last night.
Point being…some too busy talking and running POTUS Trump down…others fear what he MIGHT have to say … and of course those be the swamp creatures that control those dark pools… Life will require energy…which the Creator provided and means to be free like water to all HIS children…but the ‘lessor’ gods/children of the ‘fallen’ angel hope you’d rather subscribe to their meter do they not?
https://en.wikipedia.org/wiki/John_G._Trump
https://youtu.be/PwxNTGpM1cQ
https://youtu.be/KHVXk6mKx_k
=
https://electroverse.net/category/crop-loss/
https://electroverse.net/category/extreme-weather/
Greg, thoughts on farming from North Carolina: https://youtu.be/GXusAt0EpGA
Maybe…the next election will be, ‘its the TSI and sunspots or lack of them stupid?’
https://www.youtube.com/playlist?list=PLHSoxioQtwZcJj_9clLz7Bggso7qg2PDj

Your Brothers 09/30/2019  •

Thank You Donald Trump!
From us whose grandparents stuck it out in this, in reality a southern city, in the heart of the Mid-west and yes we proudly acknowledge our smattering of eastern European blood!
https://www.youtube.com/watch?v=6G4bxA2Gfnc
Were a great mixture up here in Detroit and were back and we like your promise to keep America great. Were with you in all you do and the thin blue line is still blue, but always for you!!
You’ll never know how much we love you for all you do for our great country and UAW!!!!!!

H. Craig Bradley 09/30/2019  •

NOT A CHANCE

https://www.youtube.com/watch?v=rHM49Lc2-so

Von Trap has been talking $10,000 an ounce gold for the past three years. Not ever going to happen. Dream on. If his clients believe that, well fine. I do not. Neither does economist Martin A. Armstrong, based on his blogs. $5,000/ounce tops and sure not now. Maybe after 2030 A.D.

JC 10/01/2019  •

I don’t know about this dollar rejection concept.
The euro peaked in 2008 at 1.47 and it’s been all downhill from there.
At the moment it is 1.09. Seems that Martin Armstrong has been right about dollar strength. It seems there is strong demand for dollars overseas.

Look at this historical annual chart of the Euro/Dollar exchange rate.

https://www.macrotrends.net/2548/euro-dollar-exchange-rate-historical-chart

Diane 10/01/2019  •

https://www.armstrongeconomics.com/world-news/corruption/sec-routinely-prosecutes-family-favors-in-business-dealings/

Rick K. 10/08/2019  •

Here’s the plan for the monetary system …
http://www3.weforum.org/docs/WEF_Global_Future_Council_Financial_Monetary_Systems_report_2018.pdf
And China is the model for Global governance. FF to 08:00 to here Klaus declare China will be #1… https://www.youtube.com/watch?v=QPhBk1UqFpo
Trump is calling for lower interest rates and dollar devaluation. The FED is loving that because the more debt that is issued (out of thin air) against collateral that can be claimed upon default, the more power the central banks have.