PeakTrader.com

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PeakTrader said...

The cost of energy as a factor of U.S. production has become smaller, because the U.S. economy has become lighter (goods in the Information and Biotech revolutions weigh almost nothing), while heavier goods were offshored (and imported).

Most, if not all, of the energy savings in U.S. production were shifted into U.S. consumer goods (e.g. larger houses, bigger autos, more imports, etc.), which raised U.S. living standards.

So, 10 years after the U.S. economy peaked in 2007, it'll be interesting to see if Peak Oil, or the higher cost of alternative energy, has reduced the average square footage of a house, created smaller autos, or caused a decline in imports (as a percentage of GDP).

The Brad DeLong Award:

Given to the hypocrite who calls someone stupid when his own stupidity is many times more costly.

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