I am sick and tired of the apathy and ambivalence of the majority of Americans. Every day here in the United States, we see and hear things, that we know are 100% wrong… 100% out of control, and yet no one says anything and if one dare speak up, you are branded as a “complainer” or are “politically incorrect”. BUT there are things going on in this Country, that our Founding Fathers actually fought against in their time and would fight against today if they were alive to see. We have turned our government over to people who have literally no idea what they are doing. We have created a system that rewards mediocrity. We have allowed our Country to be invaded by illegals. We have over-taxed our citizens in the name of “fairness”. We have allowed people to blame everyone except themselves for any unfortunate event in their lives. We worry more about hurting people’s feelings, than we do honoring each other’s rights to pursue life, liberty and happiness. I am sick and tired of all this and I am not going to be quiet any longer. I don’t care what others might think. I believe in “right and wrong”… there is no gray area. And it is wrong to allow our government to impose more and more taxes, fees and fines on its citizens. It is wrong to allow illegals to benefit from our Country’s wealth while contributing nothing. Illegals should be sent home and never return. Criminals should be arrested, and the Police should focus on crime not petty speeding tickets… And as I examine this idea of “right and wrong” I have come to conclude there was nothing wrong with Ozzie or Harriet. I am no longer going to pretend the traditional model of a nuturing mother at home, and a father bringing home the paycheck is outdated and no longer applicable to our society. The truth be known, if we returned to the Ozzie and Harriet model our nation would far better off. So the next time someone looks at me when I complain about an illegal who can’t speak a solitary word of English, or the next time I see a Cop wasting time ticketing someone for a silly parking violation or the next time I hear someone suggest that their variable rate mortgage was not their fault or that their $20,000 in credit card debt was not their responsibility as the ugly credit card companies forced them to accept their cards, or that BIG OIL, is making too much money, I am going to salute them with a proper hand gesture.

Okay, I have more to add to my Blog about supply and demand for OIL. As former geologist and energy executive, I have studied my industry, and know oil is plentiful; but over the past year, the American public has been led to believe we are truly running out of oil. In prior narratives, I have talked about oil being plentiful and about supply/demand for oil being controlled largely by OPEC. OPEC, primarily Saudi Arabia, determines available supply of oil on world markets. The world in which Saudi makes decisions is the what is called the “physical” world. The physical world is where oil is produced and consumed. The physical world impacts every aspect of world politics and economics as we see almost daily in turf wars in the Middle East. However, harking back to my days with Enron, I know there is another world that impacts the price of oil… that being the “financial” world. The financial world is the “futures market”… this is where oil is traded on paper. In the “financial” world, oil is bought and sold on phantom markets where supply and demand is theorectical. Typically, the “financial” world price and the “physical” world price converge upon delivery of the commodity, so that the final price of a commodity is in sync in both worlds. Financial or futures markets were developed by farmers to manage their risk of prices of their crops back in the 1800’s. But in 1990, under the leadership of Jeff Skilling, Enron was able to dramatically expand futures trading of oil and natural gas in the financial market by getting approval of “mark-to-market” accounting by the SEC. By this seemingly meaningless event, suddenly the world market for petroleum products changed. Of course, few realized the implications at the time. Looking back over my career, I have determined that the seed planted by Skilling in 1990, has grown into a “venus fly-trap” and created a false sense of “supply and demand” for petroleum products. To this end, it is clear that when the market price for oil ran up to $149/barrel this past summer of 2008, it was due entirely to “speculators” rather than consumers. And when our dim-wit Congress was harranging oil company executives from ExxonMobile, they should have been interrogating management of Morgan Stanley and other investment banks. I can now look back and see the manipulation by these companies… the proof is all around us. Prices for petroleum have fallen even faster than they ran up, but in both cases no one can point to a meaningful reason. Moreover, there seems to be a complete disconnect between the “physical” and “financial” worlds of commodities worldwide. Therefore, I bite my tongue in saying this, but the time has come to add more regulation to trading of commodities… particularly petroleum products. I am not suggesting that the government of the United States intervene directly, but it is now clear to me that tighter oversight is necessary. Petroleum has become the life blood of the world and we can no longer allow speculators to manipulate prices. My suggestion would be a higher “margin” requirement. The futures markets as set up today allows a 10-fold leverage your money by using futures positions. In other words, I only have to pledge $1 dollar to leverage $10 dollars of commodities. This means that I risk only $1 dollar to purchase $10 dollars in futures contracts. If I win my futures bet, I get a 10 fold return, yet my downside is minimal. This leverage has resulted in wild swings in nearly all commodity markets, and these swings have nothing to do with “supply and demand”. While I enjoyed the financial benefits of the futures market leverage, I saw the implications as early as 1994 while still working for Enron. I saw the ugly side of allowing “speculators” the ability to leverage futures as if one were gambling in “Vegas” While I hate regulations, there are times when regulation is necessary, and in the futures markets today… regulation is necessary to prevent a world-wide depression. I see this as necessary, will regulators?

Education is important, but as the saying goes: “You can drag a horse to water, but you cain’t make him drink”. The same applies to learning. If students are not there to learn, we can throw unimaginable sums of money at education and it will result in the same outcome as today’s outcome… NOTHING! From what I see, the problem is not money, not teachers, not enough public concern, but rather a lack of interest in learning by students. Drop-out rates are staggering! Teachers fear for their lives in some schools. And politicians sit around and talk about spending more money on teacher pay. WHY? Why pay teachers more, they can’t teach a student that is not receptive to learning. Until students come to school to learn, we are just wasting money, and playing petty politics. America better wake up… education is the only solution to our economic woes. History tells us that well educated societies have higher standards of living. But I fear our coming generation of American’s lack the basic R’s, and will never be able to compete with other countries like China or India. In those countries not only is education looked upon as a solution to grinding poverty, their wage scales are far far lower than America’s. The combination of highly educated citizenry and low wage scales is a “deadly” combination for our next generation of mental dwarfs… who are more knowledgeable of “Little Caesar” the pizza guy than the real Caesar from ancient Rome.