Investing in Fossil Feuls

WWF reports Norway has invested a large chunk of its Sovereign Wealth fund in 147 different coal, oil and gas companies around the world. This is one of the most sensible things to do if you understand the nature of money (it being fossil fuel credit, or carboncredit). If you don’t you may believe that the money could be moved to a different place for instance a solar panel plant or something. This is not true as we will explain.

Our money gives access to fossil fuels

Money is not valuable in itself. It is either paper or a digital number of some kind, and it has no power in itself to create wealth. The origin of the wealth we access with our money is a system of production that is driven mainly by fossil fuels. If the producers of our shoes, clothes, cars, houses, could not swap the money we gave them for fossil fuels, like diesel, gasoline, gas, oil, or derivatives, like plastic, fertilizer, they would not be able to deliver their goods for very long. This is what we call the carboncredit system, and it requires actual monitoring of the relation between liquidity and the fossil fuel supply.

Products are made with energy, People are rewarded with energy

So a bread at the baker cotst 0,75 Euro, part of that goes to lighting the shop (energy), to paying the clerk (so he can buy food, stuff, requiring energy), to logistics (energy), to truckdriver wages (so he can buy food, stuff, requiring energy), to the baking oven (energy), to the people in the factory (so they etc.), to the flour logistics, the mill, the farmer, at every step the money is used to buy energy that is largly fossil fuel based. If the energy is renewable than chances are it is very cheap or free. The same chain as this simple process has goes for every other product in our economy, from tulips to Boeing Dreamliners. So this establishes the fact that money is carboncredit.

Does a company that extracts fossil fuels need carboncredit?

So do oil extracting companies need this carboncredit? Of course the answer is NO. If money is gold they are the gold mine, they don’t need gold to dig up gold. In the case of oil it’s even more direct, you need diesel to run an oil rig, not money. You may extract crude you can directly use to power your drilling rig. This is the way it has to have been in the early days. If you don’t have any fuel as a fossil fuel extraction company you would be out of luck, and have to sell the company, but as soon as you have some gas, oil, coal, you can trade and use it directly. This is why it is so easy to hide that while the cost of one barrel of tar sand oil is close to the saudi oil before, the carbon cost of it is much higher (meaning the fossil fuel expended in turning tar sand into oil).

How much oil does it take to extract one barrel of oil? More and more

Now what does it mean for an oil company to have money in reserve, to have money invested in it. Nothing more than that it can use that money to move fossil fuels around. This is smart because if they would simply create a fossil fuel account (using barrel futures as their own money) they would break the spell. People would avoid the banks and go to the oil companies, and maybe even tell them they had no right to a cut of the wealth created, because after all they just found the stuff in the ground. It’s everywhere. It is the use of money that allows banks to control the abilities of companies to compete, even in the fossil fuel branch. 

If you reinvest the interest on investment in fossil fuel companies, you gain nothing 

Does a billion dollars invested in fossil fuel companies represent a store of wealth? NO. Because the money may help keep the companies going, but when the fuels run out they companies will collapse, and the money can only be used to buy fossil fuel from someone else. While it is invested one can say it gives right to a percentage of the output of the companies. If that money is saved it means nothing needs to be delivered while it is available, so really no value or wealth is accumulated. So the companies invloved only have to worry about whether they will be shorter lived than the sovereign wealth fund and they can give any interest anyone wants. Of course in close cooperation with the banks creating the money.

The more money is put in saving accounts, the less fossil fuel is expended 

Actually it is very convenient, almost necessary to park the money in these companies. Because if Norway would leave the money in circulation it would be used to buy fossil fuels, so saving it is a good way to limit the consumption. Saving and paying interest is the way banks ensure fossil fuel prices remain constant, and inflation doesn’t happen. That is why we call it the carbon-credit system, because banks really have to watch the relation between carbon and credit for their economy (carbon utilization process) to function well. The more money can be taken off the market, the better it is for them anyway, because they will be able to sell more loans. Ideally all money in existence is part of a tripple A rated loan. In reality cash savings and bankruptsies add money that does not have a label "owed to the bank" on it, which is why banks hate that kind of stuff. Spaculation is a great way to lose money out of the non bank economy, the hands of people that could use it to buy actuall burn once fossil fuel.

Savers are people that don’t get the carboncredit system, speculators are people that do. That is why the banks are such enormous speculators

So what about the Norwegian Sovereign Wealth Fund? The part that is invested in fossil fuel companies is worthless, especially if the plan is to reinvest. The idea the sovereign wealth fund represents any value in Kroner once Norwegian oil runs out is rediculous Who would be interested in those Kroner unless they gave access to fossil fuel. The only wise investment for the oil revenues is in renewables, because those will be able to deliver actual energy to produce wealth in the future. Sadly this is not on the agenda of the banks or Statoil, not in a way that makes oil itself obsolete, the right way. Maybe this post helps the Norwgians to see their delusion. Now there is still time to use oil to build the power sources of the future. If the oil has run out, it will be much harder. Of course we know how to do it even then and are looking for investors! 😉

The economic crisis is an energy crisis, banks keep money out of circulation to hide the shortages of fossil fuels!  

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