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| The Coming Economic Collapse: How You Can Thrive When Oil Costs $200 a Barrel | 
 enlarge | Authors: Stephen Leeb, Glen Strathy
Publisher: Business Plus
Category: Book
List Price: $16.99
Buy New: $3.87
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Avg. Customer Rating:  79 reviews
Sales Rank: 2761
Media: Paperback
Number Of Items: 1
Pages: 224
Shipping Weight (lbs): 0.6
Dimensions (in): 8.9 x 5.9 x 0.7
ISBN: 0446699004
Dewey Decimal Number: 330.900112
EAN: 9780446699006
ASIN: 0446699004
Publication Date: February 21, 2007
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Product Description
Stephen Leeb shows how hard times can be a boon for smart investors. As the world faces an energy crisis of unprecedented scope, renowed economist Stephen Leeb shows how surging oil prices will contribute to an economic collapse. With meticulous research and analysis, Leeb shows that due to strong competition from India and China, prices could soon double, a cost for which most countries and investors are ill-prepared. Now, in this groundbreaking book, Leeb not only shows how this crisis will affect consumers, but how savvy investing can turn these dire times into financial gain.
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| Customer Reviews: Read 74 more reviews...
 Get out of oil-dependent assets, as long as politics corrupt, energy policy will never be real March 15, 2006
301 out of 320 found this review helpful
I am giving this book a 5 instead of a 3 or 4 because I believe that it does a superb job of laying out some facts that every normal adult needs to understand, and I want to encourage everyone to buy and read this book.
That having been said, I also found it disappointing. The author's main points can be summed up in this review, and take less than an hour to absorb in the actual book:
1) Peak oil and the need for alternative energies are being over-shadowed by myopic media and lack-luster academics that focus on poverty, climate change, terrorism, everything but the core Achilles heel of the Western world, its addiction to cheap oil which is no more.
2) Cheap oil is made possible by blatant political and financial maneuvers that enrich a few and set the rest of us up for life long poverty. Government subsidies and tax breaks purchases by expensive lobbyists giving expensive gifts and cash bribes to our politicians are directly responsible for pre-determined failure of our energy policy and the lack of an energy strategy.
3) The catastrophic nature of the collapse of cheap oil is dramatically enhanced by the combination of the *huge* U.S. deficit and by the increased prospects of war over oil.
The author concludes with some bottom line advice for investors: get out quickly from stocks associated with high oil usage (airlines, autos, chemicals; followed by cosmetics, food requiring processing and transport, and retail dependent on far away factories and raw materials).
I disagree with one key point he makes. He assumes that Wall Street and the media have been ignoring this problem because of "group think." I certainly do agree that the larger mass of the public and the average bureaucrat that do not know any better have fallen prey to unethical propaganda, but I am quite persuaded by Twilight in the Desert: The Coming Saudi Oil Shock and the World Economy; Crossing the Rubicon: The Decline of the American Empire at the End of the Age of Oil; The Long Emergency: Surviving the End of Oil, Climate Change, and Other Converging Catastrophes of the Twenty-First Century and other books that this catastrophe in the making was clearly understood by the White House and the US Senate in 1974-1979, and a very deliberate selfish even treasonous decision was made to profit in silence and let the people fry.
This is a much simpler book than most of the others I have read and recommend, but I give it a solid five stars because if you can only afford to buy and read one book, this is the one that will be easiest and most to the point.
And just to drive the point home, when WIRED had the cover story on alternative energy, Cheney was meeting secretly with Enron and Exxon, and went on to amass 25 documented high crimes, 23 of itemized in my review of this book (Cheney makes Agnew and Johnson look like wall-flowers--this is the guy that put HIGH into "High Crimes."
Vice: Dick Cheney and the Hijacking of the American Presidency
A Must-Read February 22, 2006
157 out of 176 found this review helpful
This is a funny book. I am quite interested in the subject of peak oil, and for a non-geologist, fairly well acquainted with the science behind it.
What's funny about this book is that the title and the cover lead one to think that it's another "How to profit from the coming asteroid strike!" investment books. I picked it up expecting little more than a good laugh, and ended up shelling out hard cash for a full price copy -- something I rarely do, and I have the receipts from Amazon to prove it.
I find much to agree with in the review written by "a diplomatic historian," but here's the nub of the problem:
"This book is based upon the major notion that growing energy demands from China and India will squeeze us and propel oil prices into the stratosphere. This is self-correcting through normal economic processes."
No, it isn't self-correcting through normal economic processes, unless one includes stratospheric oil prices as a normal economic process.
Almost 30 years ago, a song by the band Tower of Power warned that "there's only so much oil in the ground." The song was written during the first oil crisis, which as Leeb points out was really a political crisis rather than a supply crisis. It turned out that there was considerably more oil in the ground than most people would have thought in the late 1970s. However, Tower of Power basically had it right. Natural economic processes hold great sway over natural resources -- up to a point. But if a resource is truly in short supply, economic processes cannot conjure more of it out of thin air. If they could, we would be buried in cod, what with the prices having gone up manyfold in the last decade or so.
In any event, this book is very much worth reading for its clearly argued contention that a shortfall of oil supply is about to push us towards a very serious economic and social crisis. Leeb is right about the growth of China and India and he's right about the lack of growth in oil production. In short, he's right.
 Ignore the lurid, juvenile title. March 3, 2006
54 out of 57 found this review helpful
The only disappointing thing about this book is the title. If I had not already read Leeb's previous book, 'The Oil Factor', I probably would have passed on this. Instead, I bought it immediately. The title puts it in the same crackpot category as Ravi Batra's rantings and the old gold bug diatribes from the 1970s, and that's a shame.
The book itself is an interesting sequel to the 'Oil Factor', but not quite as eye-opening since I've had 2 years to get into Peak Oil literature and energy investing. Leeb is an investment advisor, and his books are clearly biased toward the profit motive. His best contribution in the new book is his neat explanation of why Peak Oil isn't all over the media. Leeb's background is in psychology (a PhD), and he explains the psychological theory of "groupthink" where the best and brightest in government, industry, and academia simply go along with a consensus way past the point where it makes sense. In this case, the idea that there's plenty of oil out there is the groupthink chant coming from the likes of Rex Tillerson (Exxon CEO) and Daniel Yergin. The rest of the world then follows along. On the other hand, Leeb's investment advice is conservative enough that if Rex and Dan turn out to be right, you will end up owning some fairly conventional large cap investments like GE, Exxon, Schlumberger, P&G, and a few utilities, as well as some gold. Not a bad portfolio.
Leeb also differs from James Kunstler ('The Long Emergency') in his optimism for alternative energy sources. Kunstler would call this "cargo cult" mentality, where those technological/free market demigods will come down from the sky and give us the great gift of a cheap, non-polluting replacement for oil/gas/coal.
I'd give 'Oil Factor' 5 stars simply because it made me some money and clued me in, and this one 3 stars -- a decent book but kind of superficial compared to the other peak oil lit. However, the seriousness of the situation is starting to dawn on people like Leeb. The energy situation, if it's as bad as peak oilists think, is more than just a chance for a few clever investors to make a pile of money (see Richard Rainwater's comments in a recent issue of FORTUNE), it's a real emergency. Leeb thinks it's a matter of survival, and believes that whether we like it or not, families with the most money will have a better chance of survival in a very dangerous future.
Infinitely annoying, but still important to read. September 12, 2006
44 out of 51 found this review helpful
A lesson from Chicken Little: when you are announcing that the sky is falling, make your argument as palatable as possible to people who obviously don't want to hear it.
Stephen Leeb literally argues in this book that the very fabric of Western Civilization faces a grave danger of disintegrating because of rising oil prices. That is an extreme, but potentially feasible thesis. However, Leeb presents his theory in such a smug, one-sided manner that even the open-minded won't want to listen to him.
I am a confirmed believer in the thesis that oil prices are headed substantially higher; $200 a barrel in the near future doesn't seem at all far-fetched. I believe that the economic pain that would come with such an increase would be dramatic. All that said, I don't believe that the most likely result of that scenario is the downfall of Western Civilization as we know it.
Leeb takes every variable in the oil/economy/society equation, makes the most unfavorable assumptions possible, states them as known facts and then extrapolates. Where that doesn't work for his thesis, he generalizes or blames loosely-defined concepts (group-think is a favorite he returns to constantly). On top of all that, Leeb's writing is dripping with arrogance and disdain for those who don't already see what he sees. At one point he literally writes, "You don't need to be a PhD in psychology - which I am - to know that..." Who actually says stuff like that?
Obviously this book annoyed the heck out of me, so why 4 stars? Because ultimately there is a small, but very real chance that Leeb's arrogance will be justified and he'll actually be right. The best defense against this outcome is more people becoming aware of the threat that increasing oil prices pose to our economy and maybe even to our way of life. Even if Leeb is only partially correct, and rising oil prices only cause a massive recession, it still seems like we should be doing more to prepare for the day when oil becomes too pricey for most of the things we use it for today.
Ultimately, I think that the free market and human inginuity will prove far more powerful than Leeb gives them credit for and our government and leaders will prove as unimportant as they usually do in these situations and things will find a way to work themselves out. For that to come true, more people need to become aware of the very real threat posed by higher oil prices. If Leeb's screaming of "The Sky is Falling!" doesn't do it, I don't know what will.
useful for beginners seeking investment advice, but historically not well conceptualized February 22, 2006
29 out of 47 found this review helpful
For those believing in obtaining useful investment guidance from those trying to get rich by selling "how to get rich" books based upon alarmist and cataclysmic economic apocalypse, this book offers a considerable menu, though it is somewhat rudimentary and non-scholarly, meant more for the beginner or intermediate investor but certainly not for the sophisticated and experienced investor. This fact demands some caution. There is nothing in this book that focuses on asymmetric knowledge that exists in the stock markets, in the commodities market-- though less so in the gold market--which always favors either the insiders or those with superior knowledge. Hence we have the first caveat: this book is for beginners, for the naive ones who are bound to lose in markets heavily and unavoidably characterized by asymmetric knowledge. The second caveat is a philosophical-historical one: the book is based upon false economic-historical interpretations, namely, that a 200 dollar per barrel oil price will cause economic collapse.
Any economic historian can point to the fact that high energy prices have always been the mother of necessity bringing about major breakthroughs and, thus, improvements rather than catastrophies as this book would lead us to believe. In the l8th century England, wood was used as a major source of energy and fuel and Sherwood forest and others were cut down raising prices amid fears that fuel was becoming scarce, yet causing coal to become price competitive. Ultimately, the industrial revolution, based upon coal, broke out in England, and, though major adjustments and hardships were part of it, it did raise the living standard considerably. Once a transition from coal to oil and natural gas came about without much fanfare, further improvements resulted. Ditto with the introduction of electric power. To make a transition from one source of energy to another has happened often and should not be viewed as causing an economic collapse. Nor need we worry that much about "running out of oil," insofar as the price will rise and ration oil so that alternative sources become price competitive in such a manner that we will never run out of oil, since renewable oil sources, alternative energy sources, etc. all become activated.
What one should be concerned about is the frantic overspeculation that shows up in economic history from the Dutch tulip mania of the l7th cent. to the l9th cent. railroad boom and bust to the speculative fever in the electric power sector of the l880s to pre-'29 stock speculation and even the largest institutionalized theft in all of economic history that characterized the roaring nineties. Looking at all the ramifications and consequences of the millions of Americans who lost money when they invested in hundreds of companies that produced no products and never would have a product, one is justified in asking whether or not the authors are trying to restart another round of overspeculation.
Beyond this, the authors are viewing an economic collapse to be approaching. This historian, having spent decades on comparative economic history, dissents and would say the slow and silent relative economic decline has already been with us for decades and has been largely self-caused through monetary and fiscal policies that were not focused on the economic interests of the masses but determined largely through corporate interests. There is no economic proof that heavy participation on part of tens of millions of Americans in stock market investments, commodity speculations, etc. has entailed a favorable impact on their family/individual net worth. In fact, comparative economic statistics are showing the contrary. Stock markets, commodities and real estate investments are all zero sum games in the aggregate with the qualified exception of precious metals. For this reason, any investment advice must rest on those elements that enlarge the economic pie for the masses rather than merely rearranging it in markets whose asymmetric knowledge is always bound to favor the insiders, the few, the experienced ones who will transfer the wealth from the masses to the few who retreat ever more to oases or securitized and gated communities.
This book is based upon the major notion that growing energy demands from China and India will squeeze us and propel oil prices into the stratosphere. This is self-correcting through normal economic processes. What is far more worrisome is the increasing burden of military expenditures and fiscal and monetary policies not serving the masses and lots of other elements such as ecological strains. Together, they are far more burdensome than competition for energy sources, and they are the ones which should be the foci of correction and sound investments. Moreover, fiscal and particularly monetary policy should not be used to spread the risk across the masses as Greenspan has proudly proclaimed to be the case. Once these elements are corrected and the administration's priority shifts away from foreign policy to domestic policy, some of the investment advice of the authors would become more attractive.
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