It is what it is, and we are where we are.
If 3 or 4 years ago, you were a believer and made your moves... out of equities and into metals, Oil, farmland, and bonds... out of debt, and into a low over head lifestyle... learned some new skills, etc... good for you. 99% of the doomers reading my stuff (as well as Mish, Archdruid, LATOC, Sharon Astyk, Dmitri Orlov, Gene Logsdon, Jim Kuntsler, etc...) took ZERO action. ZERO. Why'd they bother to read? Cheap entertainment? I guess they call it "doomer porn" for good reason.
Anyway, where ever you are, that's where you are likely/going to be. So make your adjustments in place.
What little the governments could do, they have done. They put an airbag up in front of the crash, but the unwinding of debt worldwide will continue apace for the next several years, and Oil imports into the Western Industrial nations, particularly the U.S., will continue their decline. Whether the first REAL oil shock hits in 2012 or 2015 (it won't be any later) isn't really that important, is it? (Wanna know why almost ALL forecasts on Oil production and/or imports you find anywhere on the Web usually have a 3 year window as a margin of error? Because the distribution of production, and this is magnified for imports, is distributed on a bell graph, and 3 years worth of data is roughly 100 Billion barrels of Oil... if Hubbert's theory is even remotely correct, that 100 Billion barrels is all the margin of error any model needs.)
Not long ago I though the rate of change would be manageable - now I don't think so. I think my rate of change interpretation was far too anecdotal and too much of my personal experience - and I think ethanol's role, as well as increased domestic production of Crude and NG softened the blow in the U.S.. It follows then that since I think these were a "one off", a one time event, at the conclusion of the event the rate of change will once again take on its prior characteristics.
While inventories of Oil in the West might be very high at this moment... that does NOT change the export capacities of the exporting nations in the future. NOT ONE LITTLE BIT. Prices CAN go lower in the short term, and that event has nothing to do with future capacities.
Oil exports can either flat line, continue their rate of decline, or hit an air pocket over the next 18 months to 3 years. It won't matter, within 3 years I give it a 75% probability that the U.S. is rationing gasoline and heating oil, 90% within 5 years.
The next 5 to 10 years are going to be surreal for Americans, although for those that have already been broken in the first waves of this things likely appear surreal right now.
Unfortunately, you ain't seen nothing yet.
So far, the consequences have ONLY been economic. In the future there will be political consequences in the West, and especially in the U.S., that I cannot begin to fathom (actually I can, but I think Dmitri Orlov has covered this very nicely and I prefer to let the other guy sound shrill).
Here is a link to the Financial Sense News Hour for this week. Skip to the 3rd interview, about 29 minutes into the MP3 download, and listen to Larry Ortega from Logi Management, the hedge fund shop that Jeffrey Brown has associated himself with. He makes an EXCELLENT point that whet we are seeing in the markets and economy are business models that are breaking down as Oil constrains them. He then goes on to point out the likelihood of business models in the food distribution system breaking down. I used to poke fun at the doomers because I always felt there would be enough Oil to run tractors and NG for fertilizer (for several generations)... I HADN'T thought about the business model, capital requirements, energy distribution, etc... of the long range trucking of farm product. That is not a question of ALL or NONE, but a question of enough to support the model. After reflecting on this for the evening, I think he is very correct. I am getting warmer and fuzzier about farmland investment near metro centers east of the Mississippi the more I think about this...
If you have the means, there are opportunities in all of this. If you don't, the best thing you can do is adjust in place and try to enjoy your life. I think back to regular commenter "Kathy" and her take on life in or near the inner cities... very poignant...
More soon.