http://www.veteranstoday.com/2014/05/14/neo-engdahl-washingtons-shale-boom-going-bust/
While I have never discounted it I'd never thought about the financial mechanism through which the Illargi/Kunstler view of the fracking boom- just a place where capital goes to die- could be true.
"The only way oil or gas drillers have managed to maintain production volume has been to drill ever more wells, spending ever more money, taking on ever more debt in hopes of a sharp rise in the depressed US domestic gas price. As a whole shale energy companies spend more than they are making in net profit, creating a bubble of “junk” bond debt to keep the Ponzi game going. That bubble will pop the second the Fed hints interest rates will rise, or even sooner."
Reminds me of the WTF aspects of the telecom buildout in the late 90s when there were cable crews laying fiber everywhere but you'd read that the shole network was less than 1% lit. Of course that particular iteration of our serial bubbles popped and led to hundreds of $billions in defaults on the junk bonds that financed it.
Drill baby, drill.
