Sunday, April 25, 2010

No problem, no problem, no problem

Approximately 140 million customers visit Wal-Mart U.S. stores each week - - 8,446 stores that occupy 952,203,837 square feet. The retail component is supported by 120 distribution centers that serve 75 to 100 U.S. Wal-Mart Stores each and cover a 250-mile radius. The U.S. part of the distribution chain requires 7,950 drivers in 7,200 tractors pulling 53,000 trailers.

A key date in the history of Wal-Mart and energy intensive supply chains may be November 12, 2008. It was the date the International Energy Agency published its long-awaited World Energy Outlook. The summary of the report - - (1) Current oil fields are falling by seven percent per year, (2) Depletion is projected to increase to nine percent over the next few years, (3) Simply running in place would mean finding four new Saudi Arabia's by 2030, (4) The anticipation of increased Asian oil demand, namely China, will require finding six Saudi Arabia's per year, and (5) All of this will require $350 billion in exploration and investment every year through 2030, compared to the a total of $390 billion for the whole period of 2000-2007, when the economy was booming.

I hope we have plenty of oil - - our current economic model of Design In U.S. + Manufacture in China + Energy Intensive Logistics + U.S. Consumption over Savings - - is rather dependent on the "No problem, no problem, no problem" assumption with respect to oil.

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