As Cafe patrons know, I recently offered to wager Brad DeLong regarding the future real prices of a bundle of resources. Brad responded to me, by e-mail, offering a different wager – namely, that the real price of West Texas Intermediate crude oil would be higher than $20 per barrel in 2031.
Here’s my verbatim e-mail response to Brad’s counter-offer; I sent this e-mail early this morning (at 8:57am, EST):
Thanks, but the alternative wager that you present below isn’t the Simon-Ehrlich bet.
Perhaps I mistook your dim evaluation of my, [Mark] Perry’s, and [John] Tierney’s mental abilities.
Perhaps your (and I’m here not being smart-alecky) criticism is only of those who believe that supplies of energy (or at least of petroleum) will increase sufficiently over time to prevent any sustained upward trend in real energy prices; perhaps you more or less accept the more general ‘Simonesque’ proposition that supplies of commodities more generally are destined to increase over time faster than demand for those commodities increases.
I will ponder your offer to bet on the terms you here present. Now, though, I’m getting ready to make a long drive down to Clemson, SC, to attend the funeral of a friend who died on Tuesday. I’ll give you my answer on Monday.
In the meantime, though, I am curious if you believe that supplies only of energy (or of oil) will decline over time relative to demand, or if you agree with Krugman (and many others) that supplies of commodities more generally will decline over time relative to demand.
Very soon after sending this e-mail to Brad, I got into my car for a long and sad drive from Fairfax, Virginia, to Clemson, South Carolina. After pulling into Clemson, finally, at about 7:15pm (EST) tonight, I checked my e-mail to discover this blog post by DeLong, titled “I Have Failed to Get Don Boudreaux to Agree to a Bet…”
Brad DeLong is not a nice man. I would say worse, but I aspire to be a more generous soul than Brad.