Different interpretations
Formerly monolithic and dominated by the oil monarchies of the Gulf (especially Saudi Arabia), Islamic financial networks currently reflect the diversity of the Muslim world. Even countries that have made the complete Islamization of their economies have disparate systems arising from geopolitical or economic circumstances and different religious interpretations. The instruments now experiencing the greatest growth are often those who in the 1970s, were considered to be illegal (insurance or takaful) is still limited use (the fund). Thus, in parallel with the growth in the world of finance to ethical or socially responsible mutual funds, the funds are invested in companies or sectors whose legality is established (7) draining the savings of Muslims today . Islamic financial institutions operating in over seventy-five countries.
The inclusion of this Islamic finance in the global economy is full of paradoxes. The fact that the financial years 1990 generates most of its profits from commissions and fees for services (and not as formerly from the interest differential between loans and deposits) allowed to bypass the theological debates relating to riba. Moreover, the wave of financial innovation resulting from deregulation has made possible the design and sale of all kinds of "Islamic products." Such a requirement could be broken, allowing each of its two components - the "principal" and "interest" - to be sold separately.
In addition, the decline of traditional commercial bank doubled the growth of investment banks and venture capital companies justify the merits of the idea of participatory financing. Moreover, the approximation of finance and industry and the merging of business finance recreated the conditions of the world "Bankers without banks" that prevailed during the golden age of Islam.
Political developments in the Muslim world put forward certain aspects - the right to private property and free enterprise, the importance of contracts or private charity - which showed the compatibility of this conception of Islam with the " Washington Consensus "(8). Religion could then be used to deregulate, privatize, or reduce public services. Some governments - Malaysia and Bahrain, for example - made use of this interpretation to modernize their financial systems, countering other forms of Islam or face backward rentier classes and a private sector refractory to structural adjustment (9). As noted by a recent survey by the Financial Times, in many Islamic countries, Islamic institutions are often the most dynamic and innovative (10).
But ultimately the appeal of Islamic finance is mainly due to the excesses of global finance (11). For the middle class emerging in a rise of Pietism, the alternative is clear. If they have to choose between conventional finance has secular, if not "amoralisée" and a system of ethical finance sanctioned by religion (and based on the principle that economic activities remain beneficial as they take place within a strict moral framework), the decision is even easier than the number of Islamic products and institutions that offer them is growing.
Sharing losses and profits
This new financial system was based on two principles of associative finance - mudaraba (LP) and musharaka (association). Other instruments 'neutral' as Murabaha (where the bank acts as an intermediary in trade, buying goods needed for its customers and selling them for a profit) should play a transitional role: allowing banks to generate revenue until the widespread use of financial participation. As for the remuneration of deposits, it was also based on the principle of sharing profits and losses: saving accounts were paid (or not) with the profits of the establishment of "investment accounts" for finance specific investments were paid according to the results generated by these investments.
But finance partnership proved disappointing: neither the infrastructure nor the financial mentalities were favorable. Fired up by these failures, many schools moved away from initial ambitions. Lack of profitable investment in their countries of origin, they placed a significant portion of their funds in the West. Their predilection for "real property" (real estate, commodities market) exhibited a significant number of banks to huge losses. Instruments "neutral" which should play a role transition is perpetuated.
In many ways, Islamic banks do not differ more than their conventional counterparts by a language designed to disguise the existence of the interest. Their image also suffered from the collapse of Islamic investment companies in Egypt in 1988 (6) and a number of scandals. Some considered it as Islamic finance was ultimately a fleeting episode associated with the oil boom.
In fact, it was then on the verge of a very strong growth. Because of great changes had meanwhile changed the world of international finance and that of Islam: technological change and deregulation on the one hand (globalization of finance, new financial products, etc.). Political, economic, demographic and other social (impact of the Iranian revolution, the Gulf War, collapse of the Soviet Union and emergence of new Islamic states, fluctuations in the oil market, the rise of "Asian tigers", emergence of a pious bourgeoisie Muslim, etc.)..
But at the price of an update of the principles and practices of Islamic finance could know his real boom. While the first ijtihad (effort of interpretation) was characterized by legalism and scholasticism aspect, the second attached to recapture the spirit or the "moral economy" of Islam, taking into account the principles had long allowed Islam to adapt to the most diverse cultures' urf (acceptance of local customs), darura (need) and maslaha (general interest).
Milestones finance islam
Les Islamic financial institutions "weigh" about 230 billion dollars, or forty times more than in 1982 (1). Like Citibank, which since 1996 had established its own subsidiary in Bahrain Islamic, most major Western financial institutions are now engaged in such activities in the form of subsidiaries, "Islamic windows" or financial products for Muslim customers. Symbol of the integration of Islamic finance in the global economy, there is even a "Dow Jones Islamic market."
This may seem paradoxical, Islam is perceived by some as incompatible with the "new world order" that took place at the end of the Cold War (2). How to explain, in the era of globalized finance, institutions that reject the "wear" to integrate into a system based on the interests and techniques being updated with the awakening of political Islam know their golden years, even though political Islam run out of steam (3)?
A modernized Islamic banking took shape in the 1970s, at the crossroads of the rise of pan-Islamism and the oil boom. The Six Day War (June 1967) had in fact marked the beginning of the decline of the movement Nasser, pan-Arab and secular, and paved the way for regional hegemony of Saudi Arabia, under the banner of pan-Islamism. The establishment in 1970, the Organization of Islamic Conference (OIC) grouping the Muslim countries put economic precepts of Islam to the agenda. The Islamic economic research institutes proliferated.
In 1974, at the top of Lahore, the OIC decided in the wake of the quadrupling of oil prices, creating the Islamic Development Bank. Based in Jeddah, the institution laid the foundations for a support system based on Islamic principles. In 1975, the Dubai Islamic Bank was the first Islamic private bank in the making. An international association of Islamic banks was created to establish standards and defend common interests. In 1979, Pakistan became the first country to declare the Islamization of the entire banking sector. He was followed in 1983 by Sudan and Iran.
It was then up to the Muslim jurists to adapt a pre-capitalist tradition to the needs of contemporary society. For if religion showed itself favorable to trade (profession practiced by the Prophet Muhammad), condemned the gains from financial "pure." The Koran says for example that, despite their apparent similarities, the profits generated by trade are fundamentally different from those generated by the loans (Sura 2, verse 275).
Islam prohibits riba in particular. The word, generally translated as "usury", literally means "increase". But his interpretation has always been controversial: for some, riba refers to all forms of "fixed interest", for others the word means only excessive interest. Although some religious authorities - including the current Sheikh of Al Azhar in Egypt - have proclaimed the legality of certain types of interest, many scholars continue to adopt a restrictive interpretation.
Without challenging the principle of compensation for money loaned, the Islamic tradition is opposed to the aspect of "fixed and predetermined" of interest, with its implications for equity and potential for exploitation of the borrower. Islam calls for more equitable sharing of risks and benefits (4). In the early days of Islam, the commonly applied form of financing was to involve the lender and borrower, an easy dealer financed an operation conducted by a contractor, and share profits and losses equally. This form of associative finance - that will inspire the sponsorship system under French law - is a logic similar to that of venture capital popularized by the "new economy".
The theoreticians of Islamic finance thought such a system more responsive to economic needs of the Islamic world and the moral demands of religion. Indeed, whereas the bank emphasizes traditional owners of capital or property may be mortgaged, finance association gives a chance to dynamic entrepreneurs but not wealthy. The system would also allow those who, for religious reasons, preferred to previously hoarding, to integrate the productive economic circuits. Islam also add a charitable dimension: by managing the "Zakat Fund" (5) and their own donations, the banks had to fight against poverty and exclusion.
Key dates in Islamic finance
1963: Birth of Islamic finance principles in Egypt. The Mit Ghamr Saving bank offers savings accounts based on the sharing of benefits, not products.
1970: The Organization of Islamic Conference is created and launched the idea of Islamic banking.
1974 Rise of the Islamic Development Bank IDB multilateral organization comprising 56 member countries intended to provide assistance to developing countries and LDCs (26) and PMMA (6) as development aid, and with techniques Islamic finance, whether to finance foreign trade, fight against poverty, to finance certain infrastructure (roads, hydroelectric dams ..) and some social projects like building schools or health center .
1975: Creation of the Islamic bank of development and birth of Islamic banks such as the Dubai Islamic Bank, Kuwait Finance House and Bahrain Islamic Bank.
1979 and 1981 and 1983 total Islamisation of the financial systems of the countries of Sudan, Pakistan, Iran:
1979: Pakistan Islamize its banking sector.
1983: Sudan and Iran also convert their banking sectors.
Many Islamic countries of the Gulf and Asia that followed (Saudi, UAE, Indonesia, Malaysia ...)
1980-2000 Development of FI in Southeast Asia and the Middle East
2000-2008 Development of FI in Europe and the Middle East, Southeast Asia, North Africa, both in Islamic banks than traditional banks (HBSC, Deutsche, UBS, IBB, EIB ..)
The UK is now leading the development of Islamic finance in the West ...
Islamic banking in France, dream or reality?
That was in November 2008, when French Forum of Islamic finance, Christine Lagarde, Minister of Economy and Finance, enthused, referring to the looming fruitful synergies with the emergence of finance "sharia compliant "on national soil," Islamic banking has many benefits, "praised it then.
What about three years later? Islamic banking Allen has it become reality? How to buy the house, finance the project by using what is the ethical alternative of choice against the excesses of capitalism?
Who better qu'Anass Patel, president and founder of the company 570 Asset Management, which specializes in assembling financial solutions in line with Islamic ethics, and with over 12 years of experience in the field of finance and management funds, could answer these legitimate questions that arise acutely, and are certainly yours ...
Having to his credit the achievement of the first French halal ready home for an individual with a French bank in accordance with current regulations, Islamic finance explained by Anass Patel is your new recurring appointment and pragmatic OummaTV, which aims to your listening and in direct contact with your daily life.
So feel free to post your questions now at the following address: finance@oumma.com to qu'Anass Patel to treat effectively during future interventions.
Training of Imams in Islamic Finance in the United States
100 religious leaders have followed two months of training in Islamic Finance.
What does it take to get 7 million American Muslims in Islamic Finance? Train 100 imams to the principles and practice of finance halal is a first step towards this goal, the founders of the American Islamic Finance (AIF) Project have successfully completed in 2011. Founded jointly by Ethica Institute of Islamic Finance, Financial Guidance, and Islamic Society of North America, the project aims to promote AIF standards-compliant Islamic finance among the Muslim communities in North America.
The training program started with a keynote address by Mufti Taqi Usmani, chairman of the AAOIFI (Accounting and Auditing Organization for Islamic Financial Institutions), the main international standards organization in the industry of Islamic finance. The representative of Ethics Institute, "American Muslims turn to their imams for all kinds of information. By providing these imams direct training in the practical application of Islamic finance, Ethics Institute provides them with an understanding of global standards in the industry. "
The training program for imams proposed Ethics Institute aims to become annual. This program includes training sessions online (e-learning), case studies, exercises, examinations, and intensive training sessions in conventional classrooms. Banks with less use of formal training in favor of online training, training in Islamic finance is now more accessible internationally.
RIBH
Read also: More Americans Attracted by Islamic home financing
Ethica Institute of Islamic Finance
With over 20.000 users in Paid More than 40 Countries in 2011, Ethica is the world's Leading Islamic finance training and accredited certification institute, with more Learners Than Any Other Islamic finance organization in the world. Ethica Remains the only institute in the world to Deliver Standardized certification Entirely based on the Accounting and Auditing Organization for Islamic Financial Institutions (AAOIFI), the standard-setting body Leading In The Industry.
Guidance Residential
Guidance Is The Leading US provider of Sharia-compliant home financing with over $ 2 trillion in home financing. It Is A Subsidiary of Guidance Financial Group, an international company dedicated to serving the market for Sharia-compliant financial products and services. Guidance Financial Group offers unique investment products to institutional investors and Financial Intermediaries worldwide, and Provides Financial Services to retail customer base STI in the United States.
Islamic Society of North America
ISNA Is An association of Muslim Organizations and Individuals That Provides a common platform for the presenting Islam, Muslim Communities Supporting, Developing educational, social and Outreach Programs and Fostering Good Relations with Other Religious Communities, and civic and service organisms.
Forex vs. Oil
The movement of currencies is influenced by various factors: supply and demand, interest rates, economic growth and many others. Specifically, economic growth and exports is directly related to the domestic production of the country, it is natural that some currencies are closely linked to commodity prices. The currencies that have the tightest correlations with commodities are the Australian Dollar (AUD) Canadian Dollar (CAD) and the New Zealand Dollar (NZD). Other currencies are correlated, such as the Swiss Franc or the Yen but the correlation is lower.
There are many reasons behind the fall in oil prices, including a stronger dollar (since oil is priced in dollars) and a decline in global demand. As a major oil exporter, Canada has been hit hard by the decline in oil prices, while Japan (general importer) he benefits.
During the years 2006 to 2009, the correlation between the Canadian dollar and the price of oil was approximately 80%. On one day this correlation may stop but in the long run, their changes are correlated. Canada is the 7th largest oil producer in the world and continue to grow in the list thanks to large reserves that were discovered. These reserves have also been reported recently exploited, which caught the attention of many importing countries such as China. In 2000, Canada has also surpassed Saudi Arabia and the United States as an oil producer. Oil reserves in Canada are the second largest after Saudi Arabia. Canada's proximity with the United States also plays an important role, the United States can not meet all their needs with domestic production only.All these factors make it extremely sensitive to changes in Canada's oil prices.
The chart below clearly shows the positive correlation between the Canadian Dollar and oil. Oil is one of the determinants of the evolution of parity. The graph shows the evolution of oil prices and parity between May 2007 and May 2009. This shows that when the price of oil rises, the CAD appreciates.
On the other hand, Japan imports nearly all its oil they consume (compared to the United States, which imports about 50%). Before 2009, Japan was the 3rd largest oil importer behind the United States and China. Japan has a lack of natural resources and needs major oil makes it very sensitive to changes in oil prices. Moreover, oil supplies to this country 49% of energy needs and so when the price takes off, the Japanese economy suffers.
Forex Correlations / financial markets
Study of the relationship of foreign currencies relative to scholarships - Forex, Forex Trader, Finance
The different exchange rates on the Forex can be highly interrelated, but they can also be linked to other markets like stocks or commodities.
Many correlations have a fundamental reason.
Here are some correlations from the beginning of 2009 between the Australian dollar, Canadian dollar, the CRB (a basket of commodities), the Dow (stock index), gold and oil (data source: DailyFX . com):
- Forex, Forex Trader, Forex FinanceCorrélations / financial markets
The observation of these correlations shows that most are quite high and they are not negligible. One explanation for these correlations is such that countries like Australia and Canada are major exporters of raw materials, their revenues are directly impacted by changes in commodity prices which will tend to influence the course of their currencies.
But the main reason for these correlations are generally risk averse. Indeed, it is possible to classify the different asset classes according to their risk level. Fund managers will then vary the weighting of their portfolios based on the economic climate. Plus their economy look healthy, the more they will turn to risky assets as they are more profitable in the process of economic growth. The least risky assets are cash, investments, capital guaranteed, gold (especially if a period of inflation is expected), treasury bills ... assets are riskier emerging market equities, shares of small cap stocks, commodities ...
Among the currencies, a ranking is possible. On the one hand, the dollar retains its role as a refuge currency and will tend to rise during periods of economic downs. On the other hand, currencies "at risk" will tend to rise when the economy is doing well. This applies to all currencies outside the dollar: the euro, British pound ... The yen has a special status because it also becomes a currency of refuge lately.
To summarize, when the economic health appears good, scholarships rise, commodities rise and the dollar falls. Currency pairs with the dollar uncertainty (right) as the Euro Dollar, GBP / USD ... will tend to rise, that we can see from the chart below comparing the evolution of the Dow Jones and EUR / USD:
Changes in the Dow Jones and the EUR / USD - Forex, Forex Trader, Finance
The comparison of these two curves shows, however, some differences that will be interesting to watch for during the market trend as a likely return before the other, and can give an interesting indication about future courses.
The dollar index (or $ index) constructed by comparing the evolution of the dollar against a basket of currencies (euro, yen, British pound, Canadian dollar ...) can give the trend of the dollar. The $ index is also interesting to observe in parallel with some major currency pairs with the dollar as EUR / USD or GBP / USD because the same principle as using Charles Dow confirmation will be usable. The creator of the Dow Theory confirmation using this principle with evidence Rail Industrial Average and Average. According to his theory, the fact is a signal on the two indices to return to this position and to avoid the so-called false signals. The same principle can be used on the Forex, the $ index used for confirmation.The study of correlations between different markets is not easy but it can help in understanding the mechanisms of financial and capital flows. It will also be interesting for investors in several markets simultaneously stakeholders to address them in order to build an effective diversification.
First of all hedge funds are companies (the financial instruments managed by companies of savings) *, of which, however, the vast majority are registered in tax havens.
A hedge fund is a fund highly speculative (clarification: any investment in financial markets tends to be speculative, that tends to provide a certain state of the market with the goal of having much higher returns). These funds are based on this principle: the financial markets tend to make long term investments, and they use that "debts" to make subsequent investments in the short term and more risky generating capital.
For example: a hedge fund decides to borrow large sums of the market through a bank and with this money (which is actually a debt) by financial markets recklessly, by investing in short-term securities and very risky, but are risky because they give many interests and many returns that are collected in a short time.
This type of behavior in financial markets can be considered a "pirate" for two reasons: the short-term investments are fattei with real bets and without having all the money available. Can commit even 5% of the amount needed and collect even 30 or 40% profit. The second reason is that these kinds of titles - very risky - are tied to unfavorable situations (otherwise they would not have big returns). So hedge funds tend to bet on defaults of countries, the corporate failures and so on. Hedge funds generally are not linked to the banking system, although some banks are setting up their own hedge funds.
The costs charged to Italy for the connection to Turin, according to the report presented to the European Union in 2006 would stand at around 17 billion euros.
But the dossier submitted to 'the European Union in 2010, brings the cost estimates to 35 billion euros, against Italy, excluding a variety of related works, such as connecting to the node Turin, infrastructure to house the workers and tens ancillary works to a building site would result in 20 years.
But we remain at 35 billion and see what could happen, following the experience of the Italian high speed lines.
The expenses of the Rome-Florence grew by 6.8 times compared to the estimates, those of the Florence-Bologna 4 times those for the Milan-Turin 5.6 times. We are talking about official figures, well known, and on which the judiciary is trying the same answers.
If, on the basis of this experience we choose the multiplier lower than the increased costs of TAV Florence-Bologna, and multiply by 4 planned expenditure, 35 billion becomes a figure of financial fiction.
What are the rating agencies?
Formally, the research departments are: evaluate the companies that issue securities and bonds, that is their "robustness". Were born as a side activity on Wall Street and in London, more than fifty years ago. They, then, was an entirely legitimate, what would any law firm. But then came the financial liberalization, and the role of these agencies has changed over time. They themselves, in fact, have become the companies issuing securities. What's more, they draw - through the activities of security design, with the participation of talented mathematicians - and then put them on the market. But having a role in the evaluation of course affect the market price. It so happens that the role of rating agencies to become dangerously hybrid. But it could be worse: some of these agencies, for example, have placed first in the securities market doomed to failure, and then the other titles protected by those failures.It should be added that the rating agencies in Europe have a considerable force, since the debt of European countries was "desovranizzato", as they no longer run the country (monarch) that issues securities. Simplifying a little 'things, up to forty years ago worked like this: the debt of scales, say if Italy was represented by bonds issued to the Treasury. Those bonds were purchased by the Central Bank, in this case the Bank of Italy, who gave orders to the various banks to buy those securities (called "bond portfolio"). In this way the circle is closed, and a state could never fail. This mechanism has already started to ease with the liberalization. But the final blow came with the single currency, that is, with the Euro at the moment, in fact, all countries that have adopted the euro do not have a common treasury, and the European Central Bank itself has no function or politics or "material" (does not have enough reserves) to purchase securities issued by various national treasuries. So the circle never closes, and the debt of each country is very vulnerable on the market.
The costs charged to Italy for the connection to Turin, according to the report presented to the European Union in 2006 would stand at around 17 billion euros.
But the dossier submitted to 'the European Union in 2010, brings the cost estimates to 35 billion euros, against Italy, excluding a variety of related works, such as connecting to the node Turin, infrastructure to house the workers and tens ancillary works to a building site would result in 20 years.
But we remain at 35 billion and see what could happen, following the experience of the Italian high speed lines.
The expenses of the Rome-Florence grew by 6.8 times compared to the estimates, those of the Florence-Bologna 4 times those for the Milan-Turin 5.6 times. We are talking about official figures, well known, and on which the judiciary is trying the same answers.
If, on the basis of this experience we choose the multiplier lower than the increased costs of TAV Florence-Bologna, and multiply by 4 planned expenditure, 35 billion becomes a figure of financial fiction.
We are representing these days, in different countries of Europe, extraordinary comedy of the absurd. The actors are the most prominent men of government - in France, Spain, Greece, Germany, Italy - but they are so well supported in this by all other states responsible for social and political life, and above all by journalists, that we, the poor citizen-subjects, we can not understand why their hectic work there seem so lacking in a real sense of direction and fearful for this.
The spectacle offered by the "actors" Italian is tragic and surreal at the same time. Berlusconi, Tremonti, Bossi, recite wonder their little battles on the budget, transfer of any Ministry in the North, on the need for central government to help dispose of waste in Naples, as if indeed these were the political problems of a nation which must not only provide for the orderly life of 60 million people but which, due to its geographical position, its commitments with the EU and NATO, is at the center of economic and military interests worldwide. The objections are to the game with an almost incredible diligence and punctuality, keeping fixed the attention of citizens, but apparently even his own, on small details of these disputes as if you were here enclosed the main problems of the Italians. If sometimes the debate seems to become stronger, it is only because the exchange ofinvective has become more violent and vulgar terms, but it is in all cases of empty invective: used to feed the comedy. Of real politics, the dramatic real problems, no one is talking, or the government or the opposition.
What remains of the Audacity of Hope ?
Obama has not done anything bold, nor has it introduced the change envisaged in the election campaign. Perhaps, fought in the intentions, the contract is soon to logics of power.
We'll never know.
We know, and reveals him to himself in the pages of his books, that delving into the rich on Wall Street has affected to the point of becoming like them, "I know that, in consequence of my fundraising, I became more like the wealthy donors I met, in the very specific sense that I spent more time in the scrum away from the world of urgent hunger, disappointment, fear, irrationality, and often privations of the remaining 99 percent of the population - that is to help people which are entered into public life. "These lines sound like a form of justification to the efforts of balancing that for years has had to make.
From the political tightrope poised between the interests of the people and the interests of the lobbies, the voices of the city become "a distant echo rather than a tangible reality": here is the point of no return when a man gets on the hands down to terms with the political and financial power.
The catabasis obamiana is the origin of his fall.
Here is where the favors that are owed to those who helped you to reach the summit are the most pressing of "voices" of voters.
Here is where illusion becomes a promise, an illusion lies.
The road winds through the power of high finance meetings and living rooms: Obama at the bottom, although it has tried to represent fully the icon of the American dream of self-made man, the son of "a shepherd of sheep," has been a white mother and a comfortable life.
The key to understanding what is going to happen to us is contained in the concept of peak global oil production. And 'the point at which we have extracted half of all oil in the world, half as easy to get, half reached the most economically, half of best quality and less expensive to refine.
The remaining oil is what is prohibitive in places not readily accessible, such as the Arctic and the deep ocean.Much of the remaining half is difficult to remove and may require, in fact, so much energy to remove it as not worth it, if, for example, it takes a barrel of oil for a barrel of oil, it would be useless. If it takes two barrels of oil to get one, it would even insane. Much of the remaining half is in the form of crude oil with high sulfur content, difficult to refine, or tar sands and shale, which are not liquid but solid to be excavated and then liquefied to be refined by adding two more items to costs for their recovery. A considerable portion of the remaining half of the world's oil supplies original will never be recovered.Go past the peak of oil production means that all the nations of the earth will never again put together from the ground to extract as much oil as it mined at its peak, whatever the question. This has extraordinary implications for the industrial civilization based on oil, based on the expansion of all regular and consistent: population, gross domestic product, sales, profits, new housing, and so on and so forth. The passing of peak oil production is an unprecedented economic crisis that will radically alter national economies, topple governments, will alter the national borders, will result in military conflict and jeopardize the continuation of civilized life. At the time of the peak of the human race will have generated a population unable to survive on less than the amount of oil produced in that time ... and once past that point the supply of oil will decline inexorably. When that happens, complex social systems and the market will be encouraged to the point of failure, eliminating the possibility of a painless drop down from the peak.
The best information we have tells us that we pass the peak of world oil production between 2000 and 2008. The date is incorrect for several reasons. One is that the reserves (oil that still remains in the ground) reported by the private sector and nationalized oil companies tend to be generally overestimated, want to encourage stock quotes or to obtain advantages for export quotas on international markets, as in the case of members of the Organization of Petroleum Exporting Countries (OPEC).Another reason is that the "turning point" tends to occur in several years of market swings, a period of instability with recurrent shocks in prices and subsequent recession, which depressed demand and prices, a prelude to a fatal decline. Therefore the peak you will recognize only a "mirror" once the decline started fatal. The signs of continued instability in the market, therefore, tend to suggest the attainment of the peak, which will not be shown, however, if in hindsight.In other words, the peak may appear as a kind of stagnation or excess on the availability of outputs that will last a few years, while the economic stagnation (that is, the lack of growth) will reduce demand. During this period of deferral, the markets could make use of allocation strategies to continue to supply the best customers (industrialized) nations at the expense of "losers" short of cash (once called "developing nations", but that much likely to become "nations destined to never develop"). Then, slowly at first and then accelerating, world oil production will decline, economies and markets around the world show an increasing volatility, with larger and larger fluctuations than the previous peak standards , and we will enter a new era of austerity previously unimaginable. These courses are irreversible.
How could such a catastrophe is imminent and well educated and civilized people in free countries with free media and transparent institutions are so uninformed about this? No one who sees conspiracies everywhere. Although they occurred in history, the conspiracies are, almost invariably, be very small and limited to small circles of individuals.Humans are not very good at keeping secrets, individual self-interest is not interchangeable with the interest group and the two often conflict, especially among the conspirators handpieces. I do not think that the next general ignorance about the catastrophic end of the era of cheap oil is the product of a conspiracy, by entrepreneurs, government or media. And 'largely a matter of cultural inertia, aggravated by a collective illusion and raised in the midst of comfort and culture of complacency. The writer Erik Davis called it the "consensus trance".If anything, we think, most Westerners seem to believe that oil is superabbondante, if not unlimited. We believe that the world is full of huge amounts of undiscovered oil fields and that the "new technologies" drilling and extraction would work wonders in prolonging the life of existing fields. For many of us, even the best informed, the reflection stops here. The oil companies know it long, but they also know that the bad news cause harm to the business and since there are no ready-made substitutes for oil have decided to go easy on the information about the achievement of the global peak. Or show up smiling and optimistic. The British Petroleurn (BP) has been renamed "Beyond Petroleum" (beyond petroleum) to earn some points in the ranking of social responsibility without actually change anything he does.
