Everything is Everything Ep 4: The WRONG Way to Fight Extremists
Jun 7, 2024
Dive into the complexities of global oil dynamics as misconceptions about OPEC are unraveled. Explore the stark differences between fighting guerrilla warfare versus conventional battles, especially in India. Discover must-read literature that illuminates history and business in India, and delve into the emotional intricacies of Kieslowski's cinematic masterpiece, Decalogue. Finally, ponder the risk parallels between gambling and everyday life choices, revealing how our decisions are often just calculated bets.
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The Reality of OPEC's Cartel Power
- OPEC is often considered the perfect cartel but has limited pricing power due to internal conflicts and global market responses.
- Despite raising oil prices in the 1970s, it only achieved a 1.5% real price increase over 50 years, showing cartel limits.
Oil Demand's Elasticity and Innovation
- Demand for oil is inelastic short term but highly elastic in the long run due to technological adaptation.
- Attempts to extort energy supply backfire as users and markets innovate to reduce dependency.
Markets Counter Resource Scarcity Fears
- Resource scarcity fears like 'peak oil' ignore market incentives that drive exploration and alternatives.
- Economic incentives encourage innovation, preventing simple resource depletion from causing crises.
