Frac Hoax

I want to say up front this is probably 10% true, but it is strange.

I wrote a full post on fracking, so if you are interested check out the May archive (May 10). To recap, I pointed out a major blunder on the frac hoax side. In short if you read any fracking article they always want to state the evil trinity of the frac fluid recipe: sand, water, and CHEMICALS. The obvious reason is to scare the public with the word chemicals. I pointed out they screwed up by including “sand”. The reason is because this shows the size of the fractures created, the width of a grain of sand. This is because the sand props open the fractures.

I wrote the same article on a forum about a year ago, and not soon after I read some fracking articles that stated “water and chemicals”, but left out the sand. Again, 90% chance it was a coincidence. So here it is a few weeks after my last article and what do I find in an AP story?

The energy industry uses hydraulic fracturing , or fracking , to extract oil and gas from rock by injecting high-pressure mixtures of water, sand or gravel and chemicals.

So probably a coincidence, but there’s a 10% chance someone who follows me posted the information on social media that has a larger audience and the fake news media felt a need to change their story. Don’t know. Anyhow gravel is never used for fracking. There’s no way to create a slurry with gravel, and the gravel would never pass through the perforations in your casing. The hoax media wants to spread the impression of larger cracks in the formation.

If you are on social media, start spreading this story. If you are on twitter (I’m not), how about starting #frackhoax.

Misallocation and Usury

An excellent interview with Lacy Hunt.  Ties in usury and misallocation.  I’ll be picking up a copy of Kendlebergers Manias, Panics, and Crashes.  Hunt seems to hold my thesis.  Long bond yields go down and be very careful about the stock market.  The purpose of this interview is not to advise you on investments, but to get you to think about the Austrian concept of misallocation, and how usury plays into that.  Note Hunt uses the term “wrong kind of debt”.  We’ll correctly identify that as USURY.  Interview starts a few minutes in.

Move to Russia

Something you have to kick around.  The US has $20 TRILLION in federal debt alone, and multiples of that in unfunded liabilities.  As I discussed in my Podcast, medical costs are not going to get fixed.  To top it off the country drifts leftward.  Bernie probably would have beat Trump.  I think he has a good shot for 8 years, but who knows.

I don’t think the country gets fixed.  Think about Detroit.  EVERYBODY knew it was heading for bankruptcy, but the politicians would never man up and fix it.  Practically speaking if they HAD tried, they would have been kicked out of office.  So the politicians let it crash and burn so they could wring their hands and whine: “It wasn’t our fault.  We couldn’t prevent it.”

Don’t believe me?  Well look at Chicago, or even Illinois.  EVERYBODY knows they are going bankrupt.  Are they fixing it?  How about the $20 TRILLION Federal debt?

So you know it is coming.  The only sane country in the world that is Christian is Russia.  If you have kids you have to think long and hard about getting them to learn the Russian language then moving over there to some Catholic region (assuming it exists).  Our ancestors up and moved, it’s probably getting to where our kids need to think about it.

Treasury Direct

I’ve been using Treasury Direct for a few months now and it is a nice service.  Here’s a review of what it is:

Treasury Direct is a government internet service that allows you to buy T-bills.  It is run by the Treasury.  You can buy other Treasury instruments with the service, however I’m sticking to T-bills.  The government account links to your bank account, so when you purchase a T-bill they use a service similar to “Bill Pay” to withdraw the money directly.  When you hit “Approve” on Treasury Direct, they withdraw the money; you don’t have to do anything else.  When the T-bill matures, they deposit the money back into your bank account.  There is also a reinvest option per transaction which I intend to use.

What is a T-bill?  A T-bill is a relatively short term instrument that you purchase at a discount.  They are sold in $100 increments.  So if you buy (1) T-bill, Treasury Direct will withdraw say $95 dollars.  After maturity, they pay you $100.  The time periods available are 4 weeks, 13 weeks, 26 weeks, and 52 weeks.

An important feature of T-bills is that they are safer than a bank account.  If T-bills ever go belly-up, we are living in an apocalypse and the banks have long ago blown up.  The only thing safer than a T-bill is gold.  (You should own a little gold and silver.  I like junk silver coins).

T-bills pay more than a CD, and there is no commission if you use Treasury Direct.  T-bills are linked to Fed action since they are on the short end of the yield curve.  Theoretically this means 13 week and 26 week bills should have the most movement, and I’m laddering in to them.  Note, I don’t give investment advice, and if there is one area where I’m a novice, it is with interest rate investing, so do your own research.

Currently 26 week T-bills are paying 1.07%.  I am currently building a “ladder” which means purchasing a few each month, then adding to that “tranche” when they mature.  Doing this over time your account grows.  A nice feature of this is that if an emergency comes up you will have a certain tranche mature that month and you can use the money for the emergency.

Here’s a link to current interest rates:  Current Interest Rate Link

Here’s the link to Treasury Direct:

I’ll put Treasury Direct in my Links section.  That way if you want to get to your account, you can come to this isle of sanity and get your fill of a few podcasts and blogposts, then head over to Treasury Direct to take care of your finances.

Some of the more observant people reading this who also read my book are probably thinking: “You hypocrite, this is usury you are advocating.”.  If you are thinking this, I salute you for bringing up a reasonable objection.  However, recall I wrote that in a fiat paper money system, if the interest you receive is less than the inflation rate, it is not usury, as in Justice you are due back the VALUE that you lent.  Inflation is somewhere around 2%, so you can invest with a clean conscience.  This is an investment in safety primarily.

Cultural Marxism Game Plan

Someone is following the KGB plan.

  • Demoralization — complete
  • Destabilization — currently underway
  • Crisis — coming soon
  • Normalization — leftist take over

I suspect Soros, but who knows.  Check out this video of a KGB defector.  Cued up at the right place, but the whole video is interesting.  He goes more in depth on this subject in a classroom setting.  Search “Yuri Bezmenov” on Youtube

Note after this video came out, Reagan was elected and turned back the program. It seems like it got going again under Obama, though I don’t think it is Russia. I suspect someone like Soros. If you want to see “demoralization”, just check out the SJWs. The current political crisis is “Destabilization”. The government is getting paralyzed. Crisis is coming up.

More on the Leftist Mindset

An interesting discussion between Cernovich and Posobiec:

I gave you the model, and here’s a great example.  There’s one word for these people: inadequate.  That is why Mike and Jack witnessed the hatred coming from the elite fake journalists.  Those people know they are not real journalists.  They are sell out hacks, and they know it.  They also know that if the bribes and payoffs weren’t there, they would starve.  Because they lack the ability to do journalism.

Thus the hatred.  They hate Jack and Mike because they are the real deal.  The darkness can not abide by the Light.  There’s an element of that.  When Jack and Mike walk into the Whitehouse briefing room, they are the light of truth illuminating the inadequacy of the Leftists.  The Left responds with hatred.  They can’t produce, so the only way they can feel any power is to destroy.

Did you ever wonder why the Leftists always kill millions?  As I wrote before, I agree this is reality, but I still can’t accept it.  I worship Life.  I want to produce.  I can’t imagine not wanting that.

Usury addendum

I was listening to an interview the other day on the Fox Sirius radio channel.  The person being interviewed was John Kasich, governor of Ohio, a Republican.  He was asked about problems with the proposed TrumpCare.  To paraphrase:

“Well, it contains $X Billion dollars for preexisting conditions.  No governor can support that, because it is nowhere near enough.”

OK.  So Ohio can’t provide subsidized health plans to those with preexisting conditions.  That makes sense.  If he tried to raise taxes enough for the handout, he’d get thrown out of office.  And his legislature isn’t going to even vote on that since they rather like the coke and whores that goes along with their job, and they want to keep the party going.

But why does he think the Feds can do it?  Oh yeah, that’s right, the Federal Government has the Federal Reserve bankers’ guild which will buy all the bonds they can print.  Then the bankers can come collect on our unborn grandkids.  Isn’t that great?  Our unborn grandchildren can live in a world with crappy streets, high prices, high taxes, no jobs, and reduced police and fire protection while they are forced to pay back the Trillions and Trillions of dollars in debt.

There was another comment he made, that he couldn’t support a plan that would “deny” people coverage.  Think about that.  Have you heard of any law being proposed that would make it illegal for you to go to a doctor?  (The irony is that it is illegal for you to shop across state lines or buy real insurance.  I’ll go over that in the upcoming podcast).  No, there’s no law that makes it illegal for you to go the doctor.  So let’s insert some truth into his statement: “I oppose Trumpcare because he refuses to saddle our unborn grandchildren with mountains of debt so that everyone can get Fed cash and prizes today.”.  Put’s it in perspective.

The good news is I think this blows up a lot sooner than people are planning on.  Puerto Rico just got wiped out with $100 Billion in debt.  That’s big leagues.  The next bigger domino will fall.  It will be a major US city or a country in Europe.  It’s coming soon.

All About Fracking

This is a post you will want to refer to in the future.

If you haven’t heard about fracking, then you’ve been hibernating.  As a reader of this blog you are probably suspicious of the hysteria surrounding this old completions process.  And you should be.  I’ll give you the facts so that you can argue the issue effectively.

To begin, we’ll go over conventional drilling.  This involves drilling a vertical hole in the ground and setting a pipe in the bore.  Next comes compeletions, such as perfing.  You have this pipe in the ground and you want to open up say 20 feet of it to let the oil flow out of the sandstone into your bore.  To do this you lower a special explosive charge, which consists of small shaped charges on a tool called a gun.  This is set off and blows perfectly round holes in the pipe we call perforations.  The oil then flows into the pipe and up to the surface.  Later as the well ages you come back and set a pump to pump the oil out.  This is conventional production.

Now occasionally in the old days they would come across a formation that had oil in it, but it didn’t flow particularly well (pun intended).  This is called tight oil.  Way back when, they’d put dynamite down the hole and set it off.  Amazingly this would actually work to stimulate the formation, though results were not always consistent.  This was the original fraturing technology, or frack job.

Around 1947 engineers invented hydraulic fracturing which used water and sand to fracture the formation with high pressure, with the sand holding open the fractures.  This technology was developed over the years and was quite common by the early 1970’s.  I’ve read papers from that time period discussing the technique.  Hydraulic fracturing is therefore old technology that has been around for a long time;  in fact, over 4 million oil wells have been hydraulically fractured.  In 1997 I even bought a used frac tank (used to store the water) for a small plant I was running.

Now there was a type of formation that no one could produce, the famous shale formations.  They had a lot of oil in them, however drilling a vertical well and fracking it gave poor results since you could only get say 50 feet into the formation from your bore, so the oil you could eventually produce was limited to an uneconomical  amount.  You would have basically a cylinder 80 feet high and 50 feet in radius.  There’s just not enough oil contained in that cylinder to make you any money.

In the mid aughts horizontal drilling was more-or-less perfected and someone came up with the bright idea to run the bore horizontally in the shale.  Now your cylinder just became up to 2 miles long, and thus the potential was there to produce a lot of oil (and gas).  A shale oil horizontal well can typically be counted on to deliver over 300,000 bbls. of oil today.  That is economical to produce.

There was one big problem.  You could only frack say 50 feet of it.  If you tried to do more, all you would end up doing is pumping your water into the formation through the first section of your frack.  In other words, you could frack say 50 feet, and then the process would stop as you could not maintain pressure.

Here then came the new technology.  It was called multi-zonal fracking which basically consists of using sliding sleeves to cover up previous frack zones and move to a new zone.  This allowed oil companies to place fracks down the entire 2 miles in different zones.  THIS was the new technology, not hydraulic fracturing.

So how did this mass confusion arise?  It started innocently enough with a newspaper article describing the shale boom.  The reporter wanted to insert some slickster jargon (and the oil patch has plenty of jargon), so the reporter called the new technology “fracking”, instead of giving a detailed description of the sliding sleeve technology which had been the breakthrough.  I do not believe the reporter was malicious, I believe instead she wanted to use the sexy term “fracking” to spice up the story.

Only a few weeks later the eco freaks came crawling out whining how oil companies were experimenting on our water supply with this new technology.  As an aside, I wonder what they would think about acid stimulation (LOL).

So let’s analyze the scare stories.  You know, fracturing will pollute the water.  I guess they think you will get huge fissures coming up and polluting the water table.  To get an idea of how stupid this is, first take your two hands and touch your thumbs and pointer fingers together and make a circle.  This is about the size of the bore hole.  Now imagine standing at the base of the Empire State Building and looking up the side of the building.  The top of the building is way up there, in fact you can’t even see it.  Except that’s not high enough.  Stack 10 Empire State Buildings on top of each other, and now you have the right height.  Yes, the small circle of your hand (the horizontal well bore) is separated from the water table by 10 Empire State Buildings of rock and clay.

How about the fissures?  Well unfortunately for the eco freaks, in order to scare you they always make sure to mention the recipe for frack fluid.  Read any news article about fracking and you will be sure to see the following: “sand, water and CHEMICALS”.  They really want to mention the chemicals, which as an aside are similar to your hair conditioner, but that doesn’t matter, it could be tetra methyl death and still would not matter.  Did you notice “sand”?  Oops, they’ve screwed up.  Why is there sand in the frack fluid?  Yes, that is right, the size of the fractures are the width of a grain of sand and the sand props the fractures open after the pressure is taken off.  Oops.  Furthermore an oil company is lucky if they can get these sand sized fractures to extend even 100 ft. from the well bore.  That leaves a good 10,000 feet of rock and clay before you get to the water table.

Finally you have the scare stories of lighting water on fire.  Personally I think this is naturally occuring methane.  In fact, that is how you find oil and gas.  You look for surface indications like methane bubbling up or oil seeps like the La Brea tar pits in California.  You don’t have to believe me on this, just Google search “methane separator water well” and you will find these tank devices for sale.  They separate out the methane from well water and vent it off through a pipe to your roof.  Methane in well water has been around.

But there IS a small chance that an oil company is responsible, though this was never claimed and there was never a lawsuit.  The problem here is that people now confuse “fracking” with drilling and production.  IF there was a problem, 99% of the time this was due to a fly-by-night company doing a crappy job with a cement job.  Think about the Macondo Oil Well blow out that took down the Deep Water Horizon.  That is an example of a crappy oil company screwing up a cement job.  Bottom line, this has absolutely nothing to do with fracking and instead involves the conventional drilling and completions process.  In that case (pun intended) gas can leak up the outside of the well casing and into the water table.  Again, this has nothing whatsoever to do with fracking and is a potential problem with any oil or gas well.

The final myth is the earthquake myth.  Fracking does not cause earthquakes.  What probably causes earthquakes is the disposal of produced water.  Most people think of oil wells as tapping into an underground lake of oil.  This is incorrect.  What you do is drill into sandstone, shale, or other rock formations and release the trapped fluid.  The fluid is a mixture of oil, gas, and salt water.  The fluid is called emulsion.  At the surface you separate out the emulsion into its constituents in a process vessel called a treater, and you get your oil, gas, and salt water.  Unfortunately the salt water is saltier than the ocean in most cases and there is no way to clean it up since you would end up with tons and tons of contaminated salt.  Instead what happens is that companies drill disposal wells and pump the water back into the formation, or into a depleted formation.

This is the problem.  In Oklahoma many of the older wells are what we call “watered out”.  There might be 100 bbls. of water for 1 bbl. of oil.  When oil was high, companies discovered that they could pump real hard on a few wells, out of the water layer, and this would allow them to produce oil economically from the other wells.  This of course produced a lot of salt water, so disposal wells were drilled to handle it.  Unfortunately the wells were drilled on hidden fault lines.  This caused the earthquakes, not fracking.

Now yes even shale wells will produce a lot of salt water, a typical number being 30 bbls. of salt water for 100 bbls. of oil.  This is known as the water cut.  This water has to be disposed of (as is the case for the vast majority of oil wells).  This is not a problem if you make sure there are no faults where you are drilling.  In the Bakken they probably dispose of 300,000 bbls. of salt water per day, and they don’t have earthquakes.  Same in Saudi Arabia where they produce probably 10 times as much water.

This ends my review of the fracking controversy.  It is stupid, and hopefully you are now better equipped to argue it.