End of World as You Know It

Goldman Sachs predicts $150 – $200 per barrel of oil next 12 – 24 months, which is $5 to $7 a gallon.
(see story)

What do we recommend to manufacturers of all the inefficient and un-necessary product lines built to cater to builders and residents of soon to be obsolete and decaying luxo-boxes in the suburbs and the exurbs?  Makers of wine, compact, undercounter, and outdoor refrigeration, massive stainless ranges, super fridges, 42 towel washers, drying centers?
The appliance industry stands on the precipice last occupied by the US automotive industry in 1973, builders of products which require a specific set of regulatory, cultural, demographic and energy circumstances which have reached their "sell by" date.  One day, very soon, we may look at a 2007 48" double oven stainless steel range with sealed burners (arguably the very worst deal in the appliance industry) with the same quiet bemusement we now look at the 1973 Chevrolet Caprice Wagon, a car wider than the street on which it drove.
At $7 per gallon we can only begin to guess what the future holds, except this:  the appliance industry as we see it each KBIS would no longer exist, replaced by a much smaller industry populated by those who stayed on their toes.  And for those who could not duck and weave?  Stock up on rice.

NY Times:  Oil Price Rise Fails to Open Tap   ( REPAIRED LINK )

Atlantic Monthly:  The Next Slum 

Fretting?  Here’s why you can smile:  "….And Then…….Depression Set In":   October 2007 

 

 

 

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