Think of commodity futures and derivatives tied to commodity futures.
Think of sovereign and corporate Credit Default Swap on those oil producing nations and corporations.
Think of sovereign and corporate CDS on national and corporation heavily dependent on the formers.
Think of the massive pay-off required once US, Japan, EU fall into deflationary spiral.
It is not just oil commodity futures, but the Sovereign and corporate CDS on the oil producing countries and companies. Then CDS on the sovereign and corporate which ties to those nations and companies.
Do not forget the resulted deflation in US, Japan and EU. And the massive interest-rate-swap pay-off involved.
If the oil price continue to fall, how do you know that the losing trades would not be concentrated onto a handful major players, like in AIG case?
What if some of the counterparties default? Will we see a chain effect of defaulting, without "bail-out".
The knowledge will come out to the public domain and enter into public consciousness. Then we would see $5 oil price and some "up and down" in the global financial system, given all the massive amount opaque derivative bets tied to the oil prices and the debt rating of the carbon energy companies and sovereign nations.
Total global investment in carbon energy is estimated to be about $200 trillion, with at least $20 trillion return on investment and tax revenue created annually. When most of such cashflow disappear, the global economy would experience period of extreme volatility. Maybe only a RESET can solve the problem
Those astronomical numbers are just notional values. The actual cash flow involved might be only 5 to 10% of the notional, if not less.
In a perfect world where all these bets are evenly distributed, the net risk will be close to zero. But we are living in a imperfect world, and sometimes the risk could be extremely concentrated into the hands of a handful players, as in AIG case.
The biggest risk to these unregulated financial bets is the counter-party risk. If a LOSER could not pay off the losing side of the contracts and default, then the perfectly hedged chain bets will be exposed. Then large amount of such unhedged bets could lead to financial systemic risk.
The total global investment in carbon energy is estimated to be around $200 trillion. That means tens of trillions annual profits, tax revenue, and other income for various entities.
With the implementation of new concept and new technologies, most of the revenue and receipt will evaporate.
Those financial products are mostly traded OTC ( over the counter) so that the aggregate statistics on those trades are not available. The latest figure I heard is about $50 trillion notional values including all the derivative products such as interest rate swap, CDS, options, equity-linked-notes, CDO, CLO, etc.
However, the net risk of those contracts depends on how concentrated the losing trades. Do you recall AIG, which had more than $100 billion loss from its subprime CDO contracts?
but he conveniently forgot to mention that there are hundreds of billions worth of financial bets tied to oil price. The sudden crash in oil prices could potentially create havoc in those sectors.
So the damaging effect from the financial turmoil could out-weigh the beneficial effect from "tax cut".
but what Treasury Secretary Lew did not mention is that there are probably hundreds of billions notional value of financial bets tied to oil prices. The sudden collapse in oil prices would likely trigger turmoil in the financial market in a not-so-transpart way.
The damage to the mainstreet from such turmoil could out-weigh the beneficial "tax cut" effect.
The fission chain reaction is only one way to retrieve massive amount of energy from the high octaves or hyperplane. There are more controllable and constructive ways to "download" the energy: fusion, atomic hydrogen, etc. The bottom line is that the massive amount of energy is waiting for us to figure out ways to get IT.
The current fission chain reaction is not the best way to retrieve the energy from the higher octaves or hyperplanes. The fusion and many other methods might be more controllable and more constructive.
The bottom line is that the energy is there waiting for us to be smart enough to retrieve IT.
Fission chain reaction is one of the recursive method to download massive amount of energy from higher octaves. There are many method to do that in a controllable and constructive manner.
Energy is right there, and we have the knowledge already to retrieve IT.
more than it does to the overall sovereign debt load
Why now? According to usdebtclock, the US sovereign debt is about $17.9 T and the GDP is only about $17.1 T. Since the global recognition of US Dollar is the lifeline of USA and the debt continue to grow, the GDP growth must be raised to maintain the impression of solvency. Immgration Reform will have temporary boost to the GDP growth as more people can have access to government welfare programs.
Given the economic multiplier effect, each extra dollar government spending could result into a couple of dollars of GDP, though it also add one dollar to the total sovereign debt load. This is the sign that the US Elite is managing the economy for the short-term only, not for the long-term.
I wonder why? Maybe the 15-thousand-year human civilization cycle is one of the considerations? :-))
Low oil prices will for sure harm Russian economy. It will also make a major dent on the world economy, given $200 trillion global investment on the carbon energy services.
Maybe the rumored "RESET" is coming, after all.
Here is why: "Alchemical Manual for this Millennium Vol 1 and 2" by Aity Olson
This book can be downloaded online for free.
The point is that the energy is what propels the physical world and is all around us. We were told that the electrons are spinning at speed close to the speed of light, but were not told where the energy comes from to make the numerous spinning possible?
Politically, some people want to provoke Russia's Putin to WW3 by smacking down the oil price to "unimaginable" levels.
historically, commodity prices such as oil price tend to have sharp directional swing, only because the commodity trades are cash settled every day.
For example, if you buy some oil contracts at $70. Let us say the price goes down to $20 and then bounce back to $90 over the next year. Will you be able to make money?
No, you would have been wiped out since you have to continue to put on margin as the price goes down below your contract price.
Now given the conflict in Ukraine, the New York and London oil traders have more excuses to plummet the oil price unimaginable low levels.
I think that it is only matter of time when this hidden knowledge will get into the public domain, and register into the public consciousness.