The Riots In Egypt And The Price Of Oil

As if the world economy did not have enough problems already, now the riots in Egypt threaten to send the price of oil soaring into the stratosphere.  On Friday, the price of U.S. crude soared 4 percent.  A 4 percent rise in a single day is pretty staggering.  The price of Brent crude in London closed just under the magic $100 a barrel mark at $99.42.  The incredibly violent riots in Egypt have financial markets all over the globe on edge right now.  Any time there is violence or war in the Middle East it has a dramatic impact on financial markets, but this time things seem even more serious than usual.  Many believe that we could see an entirely new Egyptian government emerge out of this crisis, and the uncertainty that would bring would make investors all around the globe nervous.  Financial markets like predictability, peace and security.  If Egyptian President Hosni Mubarak’s 30 year reign is brought to an end, it will severely shake up the entire region, and that will not be good news for the global economy.

Have you seen how violent these protests have become?  Cars and buildings are on fire all over the place.  Even the headquarters of Hosni Mubarak’s political party was burned down.  The Egyptian military has been deployed on the streets of Cairo.  Protesters have been showering government forces with stones, firebombs and anything else that they can find to throw.  Security forces have been using rubber bullets, water cannons and tear gas to try to disperse the protesters but those efforts seem to be doing little good.  Deaths and injuries are being reported all over the place.  There are even rumors that the wife and son of Hosni Mubarak have already left the country.

At this point, Mubarak has gone on national television and has announced that he has asked his cabinet to resign.  That is an absolutely stunning move, but it is doubtful that the protesters will be satisfied.  All over Cairo protesters continue to chant for Mubarak to resign.

The following is a short compilation of some raw video from the riots in Egypt….

These riots in Egypt come on the heels of violent uprisings in Algeria and Tunisia.  In fact, it seems like virtually the entire Middle East is in a very foul mood right now.  Riots have been reported in Lebanon, in Jordan and in Yemen over the past few days.

Some of the rioting has been motivated by economic factors, but unfortunately all of this rioting is only going to make the global economic situation even worse.  Concern over all of these riots is driving up the price of oil and driving up the prices of agricultural commodities.  These higher prices are going to make it even harder for the poor people in the Middle East to afford food.

But also it must be acknowledged that much of this rioting is being done for very deep political and religious reasons as well.  Many westerners are cheering the protests in Egypt because they envision the protesters to be some sort of “freedom fighters”.  But the vast majority of these protesters do not desire “American-style democracy”.  The Muslim Brotherhood is one of the groups at the heart of these protests.  The government that they intend to set up would not give “liberty and freedom for all”.  Rather, it would be a hardline Islamic government based on Shariah law.  According to Wikipedia, the Muslim Brotherhood bills itself as the “world’s most influential Islamist movement”, and their goal is to impose their version of Islam on society….

The Brotherhood’s stated goal is to instill the Qur’an and Sunnah as the “sole reference point for … ordering the life of the Muslim family, individual, community … and state”

So unless your version of “freedom” includes being forced to live like the Taliban, then you probably would not enjoy the “liberty” that the Muslim Brotherhood wishes to impose on you.

Coptic Christians all over Egypt are already being slaughtered even with a relatively pro-western president in power.  On New Year’s Day, an attack on a Coptic Christian church in Egypt killed 21 people.  The following is how one eyewitness described the scene to a reporter from the New York Times….

“There were bodies on the streets,” said Sherif Ibrahim, who saw the blast’s aftermath. “Hands, legs, stomachs. Girls, women and men.”

Once a radical Islamic government is installed in Egypt it will be open season on all Christians.

Yes, there is a whole lot of blame to be passed around to other nations, organizations and individuals in the Middle East for things they have done as well, but that does not excuse the horrific persecution of the Coptic Christians in Egypt.

We have to call a spade a spade.  We cannot condemn some forms of tyranny and persecution and then make excuses for other forms of tyranny and persecution just because those doing it are on “our side”.

Replacing one form of tyranny (Mubarak) with an even more repressive form of tyranny (The Muslim Brotherhood) is not something that those who love liberty and freedom should be celebrating.

In any event, everyone should be able to agree that these events are going to severely rattle world financial markets that were already very nervous about 2011.

If these violent riots in Egypt and other countries in the Middle East keep going on, the global price of oil and the global price of food will continue to soar.

Not that oil and food were not going to be heading in that direction anyway.  Yesterday I wrote about the warning signs for the global economy that we are starting to see.  Wheat and corn have absolutely skyrocketed in price over the past 6 months.  The UN had already been projecting that we would see a 30 percent increase in the global price of food in 2011 even before these riots.

If you add rampant political instability into the mix, there is no telling how bad food inflation could get this year.

Many experts have already been forecasting substantial food shortages throughout the world this year based on all the extreme weather we have been having.  So what is going to happen if something causes those food shortages to be even worse than anticipated?

We live in very interesting times my friends.  The globe is becoming an increasingly unstable place.  Even nations that seemed perfectly stable just a few months ago can erupt in rioting at almost any moment.

People around the world are getting angry.  Thanks to the Internet, people are able to circumvent official government propaganda more easily than ever before.  This is making it harder and harder for governments to control people.

Egypt tried to regain some of that control during the riots by shutting down cell phones and by shutting down the Internet but it did not work.

Let’s just hope that Egypt can soon find peace and that the changes that are made in the Egyptian government are good for freedom and liberty.

In The Future You May Not Be Able To Provide The Basics For Your Family Even If Everyone In Your Family Has A Job

Today, millions of American families are extremely stressed out because they are working as hard as they can and yet they find at the end of the month they still haven’t been able to pay all of the bills.  Unfortunately, things are only going to get rougher in the years ahead.  The U.S. government has reached a terminal phase of the debt spiral that it is trapped in, and the only way to keep the system going is to print more money, borrow more money and spend more money.  But won’t this cause horrible inflation eventually?  Of course it will.  That is why so many people around the world have so loudly denounced “quantitative easing 2”.  The Federal Reserve is just creating hundreds of billions of dollars out of thin air and is chucking all of this money into the system in a desperate attempt to get it moving again.  This is also why the Tea Party movement is so angry about the record amounts of government debt that are being piled up.  When the U.S. government goes into more debt, it creates more dollars.  As the Federal Reserve and the U.S. government flood the system with new dollars, it means that there are now more dollars chasing roughly the same number of goods and services, and that is a recipe for inflation.

Fortunately (or unfortunately, however you want to look at it), most of this new money is trapped in the financial markets right now.  The first people that get their hands on all of this new money are banks, financial institutions and the folks down on Wall Street and right now they are hoarding much of it and much of it is going to pump up the stock market.

That is one reason why we saw such a tremendous bubble in commodities in 2010.  It is also a key reason why we have seen such a stock market “recovery”.

But eventually all of this new money is going to get into the hands of average U.S. consumers and it is going to start pushing the price of everything up.

Ronald Reagan once said that inflation is “as violent as a mugger, as frightening as an armed robber, and as deadly as a hit man.”  Ron Paul has called inflation a “hidden tax” on all of us, and that is exactly what it is.  All of the paper money that we are storing in the banks is losing a little bit of value every single day.  Over long periods of time, this loss of value becomes absolutely massive.  For example, did you know that the U.S. dollar has lost over 95 percent of its purchasing power since the Federal Reserve was created in 1913?

Unfortunately, as the Federal Reserve and the U.S. government continue to flood the system with new dollars in a desperate attempt to stimulate the economy, inflation is only going to get worse and worse and worse.

So enjoy the relatively tame inflation that we are enjoying for now.  The official U.S. government inflation rate has been hovering around 1 percent or so, but everyone knows that the official inflation rate is an absolute joke.  The government pulls different categories in and out of the inflation rate almost at will in an attempt to keep the numbers low.

One recent study that analyzed price movement of 86 products in Wal-Mart stores found that the “real” rate of inflation was approximately twice the “official” rate reported by the U.S. government.

Others are convinced that the official rate of inflation is even higher than that.  For example, John Williams of ShadowStats.com has closely studied inflation in the U.S. and he believes that it is currently hovering somewhere around 5 percent.

However, John Williams does not believe that inflation is going to stay at 5 percent for much longer.  He recently released a “Hyperinflation Special Report” for 2010 that everyone needs to read.  Personally, I do not agree with all of his conclusions and I do not believe that things are going to happen quite as quickly as he is projecting, but his overall analysis is sound.

The truth is that our financial system has now reached a terminal phase.  Just look at the chart below.  Really look at it.  How can any financial system survive debt that is rising this fast?  The printing and borrowing of money continues to spiral out of control with no end in sight.  It is hard to imagine any scenario in which we can even achieve a “soft landing”.  One way or another, this exploding debt is going to take us down…..

So are the politicians sorry that they have saddled us with all of this debt?

Well, just the other day Nancy Pelosi was directly asked this question and the following was her response….

“No, we have no regrets.”

In fact there are quite a few politicians running around in Washington D.C. that are still convinced “that deficits don’t matter” and that all this debt will never catch up with us.

Well, hold on to your hats, because this is going to be the decade when all of this debt really does start to catch up with us.

One of the ways that we are going to feel the pain is through inflation.

In the months and years ahead, wages will remain relatively stable and government entitlement payments will not increase much while prices for the basic things that American families need go through the roof.

Already we are starting to see some troubling signs of inflation.  In 2010, the price of almost every major agricultural commodity you can name shot up dramatically.  We are starting to see these price increases filter into the supermarket.  Some companies are trying to hide these price increases by shrinking package sizes.

Have you noticed this yet?  Have any of the packages that you buy regularly seemed to shrink in recent months?

Sadly, it looks like food prices are headed even higher.  According to a recent report by Reuters, world food prices hit an all-time record high in December….

World food prices rose to a record in December on higher sugar, grain and oilseed costs, the United Nations said, exceeding levels reached in 2008 that sparked deadly riots from Haiti to Egypt.

So what are you and your family going to do if a worldwide food shortage pushes food prices up significantly?

Another place where American families are really going to start feeling the pain is at the gas pump.

Do you remember back in October when I warned you that 100 dollar oil is coming?

Well, the price of Brent crude reached 95 dollars a barrel for the first time in almost two years on Monday.

Unfortunately, there are many who now believe that the price of oil is going to go a lot higher than that.

John Hofmeister, the former president of Shell Oil, believes that American consumers will likely be paying 5 dollars for a gallon of gas by the time 2012 rolls around.

So is your employer going to be paying you much more to keep up with rising gas prices?

Of course not.

And you know what?

When the price of oil rises, it affects the price of almost everything else in the stores, because nearly everything has to be transported in one way or another.

So why is the price of oil going up so much?  Well, of course there are speculators and of course the price of oil is highly manipulated, but one of the big reasons why oil is going up is because the U.S. dollar is losing value.

The cost of other basics is going up as well.  Have your health insurance premiums gone up lately?  All over the country, horrific health insurance premium increases are being reported.

Quite a few of the readers of this column have stated that they simply cannot afford health insurance anymore and so they are now doing without it.  There are millions of Americans that refuse to go to a hospital because there is no way they can pay for health insurance and there is no way they can pay the ridiculous fees charged by our hospitals today.

Sadly, in the months and years to come millions more working American families will be pushed into poverty-like conditions by rising inflation.

Already we are seeing huge numbers of American families that are working as hard as they can not being able to afford the basics.

A year-end survey conducted by Pew Research found the following….

*51% of Americans say that it is difficult to afford health care.

*48% of Americans say that it is difficult to pay their home heating and electric bills.

*29% of Americans say that it is difficult to afford food.

Those numbers should be quite sobering for us all – especially considering the fact that jobs are becoming very difficult to get.

According to the same Pew Research study, a staggering 46 percent of all Americans say that someone in their household has been without a job and looking for work at some point during the past year.

It can be really depressing to search for a decent job month after month after month when there doesn’t seem to be any out there.

The truth is that there are 7 million less middle class jobs in America today than there were just a decade ago.

So if even one person if your family has a decent job you should consider yourself to be very fortunate.

But sadly even families where everyone is working are going to continue to be stretched further and further financially as rapidly increasing inflation steals our purchasing power a little bit more every single day.

The “good times” are rapidly coming to an end.  The greatest debt-fueled party in the history of the world is wrapping up and you should enjoy it while you still can, because the years ahead are just going to be brutal.

Did The Price Of Oil Help Cause The Financial Crisis Of 2008? Will Surging Oil Prices Soon Spark Another Financial Crisis?

Oil prices are starting to spin out of control once again.  In London, Brent North Sea crude for delivery in February hit 91.89 dollars a barrel on Friday.  New York crude moved above 88 dollars a barrel on Friday.  Many analysts believe that 100 dollar oil is a virtual certainty now.  In fact, many economists are convinced that oil is going to start moving well beyond the 100 dollar mark.  So what happened the last time oil went well above 100 dollars a barrel?  Oh, that’s right, we had a major financial crisis.  Not that subprime mortgages, rampant corruption on Wall Street and out of control debt didn’t play major roles in precipitating the financial crisis as well, but the truth is that most economists have not given the price of oil the proper credit for the role that it played in almost crashing the world economy.  In July 2008, the price of oil hit a record high of over $147 a barrel.  A couple months later all hell broke loose on world financial markets.  The truth is that having the price of oil that high created horrific imbalances in the global economy.  Fortunately the price of oil took a huge nosedive after hitting that record high, and it can be argued that lower oil prices helped stabilize the world economy.  So now that oil prices are on a relentless march upward again, what can we expect this time?

Well, what we can expect is more economic trouble.  The truth is that oil is the “blood” of our economy.  Without oil nothing moves and virtually no economic activity would take place.  Our entire economic system is based on the ability to cheaply and efficiently move people and products.  An increase in the price of oil puts inflationary pressure on virtually everything else in our society.  Without cheap oil, the entire game changes.

The chart below shows what the price of oil has done since 1950 (although it doesn’t include the most recent data).  With the price of oil marching towards 100 dollars a barrel again, many people are wondering what this is going to mean for the U.S. economic “recovery”….


Just think about it.  What is it going to do to U.S. households when they have to start spending four, five or even six dollars on a gallon of gas?

What is it going to do to our trucking and shipping costs?

What is it going to do to the price of food?  According to the U.S. Bureau of Labor Statistics, food inflation in the United States was already 1 1/2 times higher than the overall rate of inflation during the past year.  But that is nothing compared to what is coming.

During 2010, the price of just about every major agricultural commodity has shot up dramatically.  These price increases are just starting to filter down to the consumer level.  So what is going to happen if oil shoots up to 100, 120 or even 150 dollars a barrel?

Demand for oil is only going to continue to increase.  Do you know who the number one consumer of energy on the globe is today?  For about a hundred years it was the United States, but now it is China.  Other emerging markets are starting to gobble up oil at a voracious pace as well.

Not that the price of oil isn’t highly manipulated.  Of course it is.  The truth is that the price of oil should not be nearly as high as it currently is.  Unfortunately, you and I have very little say on the matter.

If the price of oil keep going higher, it is really going to start having a dramatic impact on global economic activity at some point.  Meanwhile, oil producers and the big global oil companies will pull in record profits, and radical “environmentalists” will love it because people will be forced to start using less oil.

When it comes to oil, there are a lot of “agendas” out there, and unfortunately it looks like the pendulum is swinging back towards those who have “agendas” that favor a very high price for oil.

So what does that mean for all of us?

It is going to mean higher prices at the pump, higher prices at the supermarket and higher prices for almost everything else that we buy.

If the price of oil causes a significant slowdown in economic activity, it could also mean that a whole bunch of us may lose our jobs.

In an article that I published yesterday entitled “Tipping Point: 25 Signs That The Coming Financial Collapse Is Now Closer Than Ever“, I didn’t even mention that price of oil.  There are just so many danger signs in the world economy right now that it is easy to overlook some of them.

Yes, it is time to start ringing the alarms.

The ratio of corporate insider stock selling to corporate insider stock buying is at the highest it has been in nearly four years.  This is so similar to what happened just prior to the last financial crisis.  The corporate insiders are seeing the writing on the wall and they are flocking for the exits.

Many savvy investors are getting out of paper and are looking for hard assets to put their money in.  For example, China is buying gold like there is no tomorrow.  The Chinese seem to sense that something is coming.  But of course they are not alone.  All over the world top economists are warning that we are flirting with disaster.

On Friday, Moody’s slashed Ireland’s credit rating by five notches to Baa1, and is warning that even more downgrades may follow.

Just think about that for a moment.

Moody’s didn’t just downgrade Irish debt a little – what Moody’s basically did was take out a big wooden mallet and pummel it into oblivion.

Irish debt is now considered little more than garbage in world financial markets now.  Unfortunately, Greece, Spain, Portugal, Italy, Belgium and a bunch of other European nations are also headed down the same road.

The truth is that the euro is much closer to a major collapse than most Americans would ever dream.

The world financial system is teetering on the brink of another major financial crisis, and rising oil prices certainly are not going to help that.

If the price of oil breaks the 100 dollar mark, it will be time to become seriously alarmed.

If the price of oil breaks the 150 dollar mark in 2011 it will be time to push the panic button.

Let’s hope that the price of oil stabilizes for a while, but unfortunately that is probably not going to happen.

The truth is that the economic outlook for 2011 is bleak at best, especially if the price of oil continues to skyrocket.

8 Reasons Why The Pain From The Gulf Of Mexico Oil Spill Is Going To Be Felt For Decades

As oil continues to pour into the Gulf of Mexico at a staggering rate, many are now starting to realize that the pain from this oil spill will be felt not just for months or years – but for decades.  At least 4.2 million gallons of oil (and some estimates put the total at far higher than that) are already in the Gulf of Mexico causing untold damage to the ecologically fragile Louisiana coast.  The oil has already made contact with the Chandeleur Islands off of the coast of Louisiana, and over the next few days more areas are expected to see oil come ashore.  But just because this disaster is unfolding in slow-motion does not mean that this is not going to be a complete and utter tragedy for the Gulf Coast region.  In fact, many of those living along the Gulf Coast now fear that this oil spill is going to do far more damage to the region than Hurricane Katrina did.  And after Hurricane Katrina and everything else that folks living down there have been through over the past several years, the thought of weathering another massive tragedy is almost too much.

It certainly doesn’t help that those attempting to stop the leak don’t really seem to know what they are doing.  After failing to contain the oil spill with a giant concrete and steel dome, BP announced on Monday that it will make a second attempt this week using a smaller version of the dome dubbed the “Top Hat”.

“Top Hat”?

If BP was as good at stopping oil leaks as they are at coming up with cute little code names for their operations perhaps this crisis would be over by now.

But the truth is that attempting to do anything at depths of up to one mile below the surface of the Gulf of Mexico is extremely difficult.

It kind of makes you wonder what in the world we were doing drilling for oil down there in the first place.

In any event, BP is not just relying on the “Top Hat” to stop the leak.

BP is also considering plugging the damaged blowout preventer on the underwater well by pumping debris into it at high pressure.  This technique is known as a “junk shot”.

Or, in other words, BP would be plugging the leak by shooting a bunch of garbage into it.  One official recently described this method to CBS News this way….

“They are actually going to take a bunch of debris — some shredded up tires, golf balls and things like that — and under very high pressure shoot it into the preventer itself and see if they can clog it up to stop the leak.”

But what many media outlets are not admitting is that the “junk shot” procedure is extremely risky.  In fact, some experts are warning that tinkering with the damaged blowout preventer could make the leak much worse.

But something has got to be done.  Even members of the U.S. Congress are admitting that this oil could end up getting into the Loop Current and going up the east coast of the United States….

“If this gusher continues for several months, it’s going to cover up the Gulf Coast and it’s going to get down into the Loop Current and that’s going to take it down into the Florida Keys and up the east coast of Florida,” Florida Democratic Senator Bill Nelson told CNN.

To get an idea of just how devastating the oil spill in the Gulf of Mexico is already, check out the aerial footage in the video below.  As you watch this video, just try to imagine how horrific this crisis is going to be if oil continues to gush into the Gulf for weeks or months….

The truth is that this has the potential to be one of the greatest tragedies in the history of the United States.  The following are 8 of the reasons why the pain from the Gulf of Mexico oil spill is going to be felt for decades to come….

#1) The Fishing, Shrimping And Oyster Industries In The Gulf Are Being Destroyed

Seafood is a 2.4 billion dollar industry in the state of Louisiana.  In fact, Louisiana produces more than 30 percent of the seafood originating in the continental United States.

But that is about to dramatically change.  As the waters off Louisiana are being progressively poisoned by all the oil, fishermen and shrimpers are starting to realize that their lives will never be the same.

In fact, some local shrimpers in Louisiana are already predicting that it will be seven years before they can set to sea again.

So are they being overly dramatic?

No, especially when you consider the fact that fishermen in Cordova, Alaska are still struggling 21 years after the 1989 Exxon Valdez oil spill devastated the fishing industry in that region.

#2) The Damage To The Environment And Wildlife In the Gulf Is Going To Be Unprecedented

Already, environmentalists are warning that the oil spill in the Gulf of Mexico could absolutely devastate the bird population of the region.  You see, nearly 75 percent of all U.S. waterfowl use Louisiana’s three million acres of wetlands to rest or nest.  Once the oil spill gets into those wetlands it is going to be an absolute nightmare for those waterfowl.

But it isn’t just waterfowl that are at risk.  Literally hundreds of different species that inhabit the coastal areas surrounding the Gulf of Mexico will soon be facing an oily nightmare that they don’t even know is coming.  Entire ecosystems are going to be permanently altered.  Florida Governor Charlie Crist recently put it this way….

“Florida is currently preparing for what we all know is an environmental disaster of unprecedented proportions for our state and Gulf of Mexico partner states.”

In fact, Richard Charter of the Defenders of Wildlife says that we are looking at an environmental impact that is going to last for decades….

“It is so big and expanding so fast that it’s pretty much beyond human response that can be effective. … You’re looking at a long-term poisoning of the area. Ultimately, this will have a multidecade impact.”

#3) The Natural Beauty Of The Gulf Coast Region Will Never Be The Same

Anyone who has ever been to the Gulf Coast knows how amazingly beautiful that it can be.  But once it is covered with millions of gallons of oil it will never be the same.

Brenda Prosser of Mobile, Alabama said that she wept when she saw the workers attempting to try to prevent the oil spill from spreading….

“I just started crying. I couldn’t quit crying. I’m shaking now.  To know that our beach may be black or brown, or that we can’t get in the water, it’s so sad.”

And it is a great tragedy.  This didn’t have to happen.  But now the great natural beauty of our coasts is being destroyed and we aren’t going to be able to get it back for a long, long time as Public Service Commissioner Benjamin Stevens recently explained….

“You get hit by a hurricane and you can rebuild. But when that stuff washes up on the white sands of Pensacola Beach, you can’t just go and get more white sand.”

Louis Miller of the Mississippi Sierra Club was a bit more dramatic in describing what this oil spill means for the region….

“This is going to destroy the Mississippi and the Gulf Coast as we know it.”

#4) Tourism Along The Gulf Coast Is Now Dead

Needless to say, very few people are going to want to vacation along the Gulf Coast for quite a long time.

Hotel Owner Dodie Vegas put it this way….

“It’s just going to kill us. It’s going to destroy us.”

#5) The Gulf Of Mexico Oil Spill Is Going To Greatly Contribute To The Ongoing Poisoning Of The World’s Water Supply

Over the past twenty years, the world has witnessed 30 oil spills larger than the Exxon Valdez tragedy.  Both the global food chain and the world’s waters are being progressively poisoned by all of this oil.  In fact, nature can simply not keep up with how fast we are poisoning the water all over the world.  This current oil spill in the Gulf of Mexico is not going to help things at all.

#6) This Oil Spill Is Going To Have A Dramatic Chilling Effect On Oil Exploration

The head of the International Energy Agency is warning that this disaster will slow the exploration and development of offshore oil projects worldwide.  Now that the danger of offshore drilling has become more apparent, approval of new projects is going to be much more difficult around the world, and oil companies are going to be less inclined to invest in such projects.

#7) Oil Prices Around The Globe Are Going To Rise

Oil prices have already gone up as a result of this oil spill, and they are likely to stay high for the long-term as demand continues to increase while supplies grow less quickly.  As noted in point #6, this crisis is going to have a chilling effect on oil exploration, and that is going to mean less oil as we move forward.  Less oil and increasing demand means that prices are going to rise, and that is not good news for the U.S. economy.

#8) The Economy Of The Gulf Coast Region Is Going To Be Devastated

Two of the major industries in the Gulf region, seafood and tourism, are going to be pretty much wiped out in the short-term.  Many areas along the Gulf, particularly in Louisiana, were already economic disaster areas even before this oil spill.  The truth is that economic conditions down there are simply not strong enough to weather another major tragedy.

The oil spill in the Gulf of Mexico is essentially “a slow-motion Katrina” which is going to alter the economy of the Gulf region permanently.

One anonymous Louisiana resident put it this way….

“A hurricane is like closing your bank account for a few days, but this here has the capacity to destroy our bank accounts.”

It is hard to even imagine the despair that those living along the Gulf Coast are feeling right now.  Let’s pray for them and assist them in any way that we can, and let us hope that they get that darn leak stopped as quickly as possible.

Austin Coins

 

Will The Gulf Of Mexico Oil Spill Be An Economic Disaster That The Gulf Coast Will Never Recover From?

As a silent blanket of black goo that is now about the size of the state of Florida slowly but relentlessly drifts towards the Gulf Coast, communities in the region are bracing for an economic catastrophe that is being described as a “slow motion Katrina”.  Still reeling from the effects of Hurricane Katrina after all these years, many who depend on the Gulf of Mexico for their livelihood fear that the massive oil spill heading their way could prove to be an economic disaster from which they will never recover.  Thousands of businesses in the region could go under before all of this is over, and millions could lose their jobs.  As the gigantic mass of black oil kills and maims all the wildlife it encounters, and as it pushes dangerously close to the coastal wetlands, many residents are predicting that two of the most important industries in the region – seafood and tourism – will be completely and totally destroyed.

Already, the edges of the massive oil spill in the Gulf of Mexico have grazed the barrier islands off Louisiana’s Chandeleur and Breton sounds.  BP spokeswoman Ayana McIntosh-Lee announced on Monday that the damaged well is releasing 210,000 gallons of oil a day into the Gulf of Mexico.  At this point there is no end in sight.

In fact, the oil spill in the Gulf Of Mexico is now larger than the entire state of Florida, and each day it grows larger and more insidious.

Scientists in the region tell us that the Gulf oil spill could actually get into what’s called the “Loop Current” within a day, eventually carrying oil south along the Florida coast and into the Florida Keys.  In fact, one prominent oceanographer says that he cannot think of any scenario where the oil spill doesn’t eventually reach the Florida Keys.

And there are indications that things could get a whole lot worse before they get better.

It is being reported that a confidential government report on the oil spill in the Gulf makes it clear that the Coast Guard now fears that the damaged well could become an unchecked gusher shooting millions of gallons of oil per day into the Gulf.  One Alabama newspaper has posted excerpts from this alarming report….

“The following is not public,” reads the National Oceanic and Atmospheric Administration’s Emergency Response document dated April 28th that was posted on . “Two additional release points were found today in the tangled riser. If the riser pipe deteriorates further, the flow could become unchecked resulting in a release volume an order of magnitude higher than previously thought.”

How bad could it get?

Well, if the riser pipe blows out, experts tell us that we could see 5 to 10 times as much oil flowing into the Gulf as we are now.

That would be a nightmare of Biblical proportions.

Not that we aren’t facing a complete and total nightmare already.

Both Obama administration and BP are  indicating that it might take up to three months to completely seal off the leaking oil well.

3 more months of oil flowing into the Gulf?

How in the world could the Gulf Coast ever recover from that?

And once the oil spill gets into the wetlands along the coast it will never, ever be able to be totally cleaned up.

Already, environmentalists are warning that the oil spill in the Gulf of Mexico could absolutely devastate the bird population of the region.

You see, nearly 75 percent of all U.S. waterfowl use Louisiana’s three million acres of wetlands to rest or nest.  Once the oil spill gets into those wetlands it is over for those waterfowl.

Not only that, but Louisiana produces more fish and seafood than anywhere in the United States except for Alaska.  The cost of this disaster to the fishing industry in Louisiana alone could top 3 billion dollars, and it is being projected that the tourism industry in Florida could lose even more than that.

In fact, some local shrimpers in the region are gloomily forecasting that it will be seven years before they can set to sea again.

Are you starting to get the picture?

Entire industries are going to be wiped out by this thing.

In economic terms, this is far bigger than Katrina.

What we are witnessing is the potential economic death of an entire region.

To get an idea of just what kind of a nightmare the residents of the Gulf Coast are facing, just read some of the quotes that have been popping up in mainstream media sources over the last couple of days….

The Telegraph:

“Worst case scenarios almost never happen,” Professor Robert Thomas, of New Orleans’ Loyola University, was quoted as saying yesterday. “In this case, almost everyone I have known with technical knowledge of oil spills – people who have worked in the industry 30, 40 years – say it is upon us.”

Louis Miller of the Mississippi Sierra Club:

This is going to destroy the Mississippi and the Gulf Coast as we know it.

The Los Angeles Times:

“A major oil spill would devastate the ecosystem and the economy based on that ecosystem,” said Larry Crowder, professor of marine biology at Duke University’s Nicholas School of the Environment. “It’s a particularly bad time of year because just about everything is nesting or replicating.

“In the Gulf of Mexico giant blue fin tuna are spawning, and their eggs and larvae float on the surface,” he said. “Seabirds and gulls are nesting. For nesting sea turtles, obviously, oiling the beaches could have a devastating impact.”

An anonymous Louisiana resident:

“A hurricane is like closing your bank account for a few days, but this here has the capacity to destroy our bank accounts.”

Even if you have a heart that is cold as a stone, now is the time to pray for those who live along the Gulf Coast.  The oil spill relentlessly pushing towards the shore threatens to destroy countless numbers of lives.

Hopefully BP (or someone else) will find a way to keep this disaster from escalating out of control.

If not, there are going to be a whole lot of people who are going to need our help.

Emergency Seed Bank

Emergency Seed Bank

Do NOT follow this link or you will be banned from the site!