The Massive Increase Of Central Bank Paper Assets Warns Of Financial Danger Ahead
By purchasing increasingly worthless paper assets, we can thank the central banks for propping up the global economy for the past decade. Since the 2008 financial crisis, the top central bank’s have acquired $13 trillion worth of assets on their balance sheets. While the central banks label these balance sheet items as “Assets,” they are nothing more than glorified Paper IOU’s.
And these trillions of dollars worth of paper IOU’s can only get their value from the burning of energy… a critical factor overlooked by mainstream financial analysts. Without growing global oil production, most of these “supposed” assets would see their values plummet. Unfortunately, the world is heading towards a collapse of global oil production due to the Falling EROI – Energy Returned On Investment and the Thermodynamics of oil depletion.
Yes, the disintegration of the global oil industry is now speeding up. Here are a few headlines that should provide some clues on how the situation is rapidly deteriorating:
Wall Street Loses Faith In Shale
Saudi Aramco’s Ghawar field produces 1.2mbpd less than expected
NEXT OIL DOMINO TO FALL? Mexico Becomes A Net Oil Importer
Fracked Shale Oil Wells Drying Up Faster than Predicted, Wall Street Journal Finds
THE BLOODBATH IN U.S. SHALE STOCKS CONTINUES: Worst Is Yet To Come
US Shale Companies Facing “Catastrophic Failure” over Ballooning Debt
EXXONMOBIL U.S. OIL & GAS FINANCIAL TRAIN-WRECK: Producing Shale Is Destroying Its Bottom Line
As you can see, most of the articles are on the U.S. Shale Industry. We must remember, the majority of the increase in global oil production over the past decade (80+%) is due to ramping up of the U.S. shale oil and Canadian oil sands operations. U.S. shale oil production has surged by more than 7 million barrels per day (mbd) since 2008:
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