"It's the end of the world as we know it, and I feel..."
http://www.lifeaftertheoilcrash.net
If you can read the above web site (which BTW does contain a lot of alarmist concepts, and not-very-good science), you really should. Many of the points made are 100% dead-on; Gas prices will be the equivalent of $7-10 per gallon in today's prices by 2010, if looked at with nothing else changing, due to scarcity.
However, other things WILL change; the price of transporting meat to your local grocery store will be changed, because gas is used to do this; conservatively, if we look at the cost of transportation going up 700%-1000%, this will be passed on to us; transport for groceries is pegged at around 10% of the retail cost, which would make the cost for a current lb of hamburger go from $2 a lb to $3.20-$3.80 a lb.
The grain and feed for the cattle also has to be transported (more increase), the grain also has to be grown (tractors, threshers, combines, more increase). it would not be surprising to see Hamburger hit $5.00 a lb by 2010. That's just burger; everything, EVERYTHING else will see a similar increase. So, the people who drill oil, run refineries, drive delivery trucks, etc are going to need pay increases just to feed their families. In order to increase worker pay, the companies providing the services will have to raise their prices. which means increases, beyond the $7-10 a gallon, to the price of gas.
Let me digress for a moment. Do you understand economics? basic economics? lets take it back to simple economics, to make things easy. the farmer grows grain; he takes the grain to the miller, who takes a percentage of the grain in order to turn it into flour. the farmer takes the grain to the baker, who takes a percentage of the flour to turn the rest into bread. if the farmer has more bread than his family needs, he can trade some of it to craftsmen for items which are needed, such as ploughs, pottery, musical instruments, etc. like I said, very basic.
Lets look at the increase in gas prices this way; the miller's creek starts drying up, meaning that he can't grind as much grain as he used to. since he can't grind as much grain, his total grain he gets from farmers decreases, meaning he looses some of the things he needs to take care of his family. so he raises the percentage of grain he needs for grinding flour for the farmers; his family is ok (until the water flow decreases more). But the farmer has less flour, and many farmers aren't able to get all their grain ground into flour; the farmers with grain laying around look for alternate ways to get flour from their grain, but all the other methods require more work than is really possible (if they spend all day hand grinding grain into flour, that's less time they can be growing grain). it also means that they don't get to trade their surplus for things they need to make the farm run, which means they are essentially screwed. The farmers who DO manage to get grain turned into flour take it to the baker, but once again, since there is less flour going to the baker, the baker starts to feel the pinch, so takes a bigger percentage of flour from the farmer; the farmer comes away from the baker with hopefully enough bread to feed his family, but probably not enough to trade for things he needs to run his farm, unless he's lucky. The musical instrument makers feel the pinch pretty quick; sure the miller and the baker have enough surplus to trade for musical instruments, but not the farmers; for a short time they might make ends meet by charging more from the people who HAVE bread, but eventually they will probably have to find a different way to feed their families. the people who make ploughs will do pretty good, since they are making something people HAVE to have, but with less total bread output from the community, they will have to raise their prices; only the most successful farmers will be able to pay the higher prices. Eventually, through starvation or fighting, the community will have to reduce it's size to one that can be supported by the reduced flow of water in the millers stream, or find another way to grind flour that works as well, or better than, the miller's water wheel.
Ok. We have 3 ways to deal with the current situation; either have
1) a lot of people evaporate, ascend, or just plain DIE, from starving to death.
2) War! we take all the Oil Reserves in the world (currently the favored U.S. plan) and hope we come up with something different by the time they are gone.
3) come up with a new way to power our infrastructure, QUICK! (not real likely, put this under the heading of "pray for something to happen").
If you have kids who will be 18-25 in 2010, what can YOU do? I'm saying they will either starve to death, be a soldier in the USian Oil Empire, or unbelievably lucky in order to survive, right? I really should offer some for of solution after making you read through all of this, right? Ok. Not EVERYONE is going to starve. we just have to figure out a way to be among those people who actually have enough to survive. The main thing is to just take it as a FACT that in 5 years the world will not look much like it looks now; it is possible that the US will be able to take and hold all the worlds oil reserves, and therefore maintain our standard of living to something similar (really doubtful, our economy is based of deficit trading, and if Japan, china, Taiwan and Europe are starving to death, the mass consumer goods for low prices just won't exist), but I wouldn't plan on it. Just be a pessimist, if I'm wrong you'll be pleasantly surprised, and have a lot more money! Ok, quick and easy "surviving the coming hell".
Real Estate
Economists have been predicting the collapse of the real estate bubble since about a year after the rest of the economy tanked; the only thing they are puzzled about is why it hasn't already done so. If you have a nice house, in town or the suburbs, on a nice lot, sell that puppy. NOW. do not wait. dump it. quick. ok, that done? no? oh. How is that house heated? electric or natural gas? what are your bills going to look like when your heating and cooling bill goes up 700%-1000%? and your grocery prices go up by 300%-500%? Doesn't leave much for paying mortgage or even property tax, does it? and wouldn't it be nice to have enough ground around you to grow a row of potatoes? Right, now that that's done, lets move to step 2. Use your new-found riches to buy some LAND. 15-20 acres. add 5 acres for every person over 5 you plan on having live with you. Note I am NOT saying drop out and start a commune, I'm saying get a nice place in the country instead of the place in town, you don't have to do anything WITH it or anything, just change your location. Don't put a trailer on it. build a house. I suggest concrete or straw bale (google "straw bale house"), or possibly underground; this will cut your heating and cooling needs approximately in half. you can put in a electric furnace, heat pump, whatever.. but get a wood stove, also. you don't have to use it, just get one. makes a good conversation piece. If you can, buy solar panels for your roof; cover your hay bale house in solar panels, and you will probably end up selling electricity back to the power company. Drill a well. you don't have to drink it, but you need one. you can use it for your grey water (flushing, watering, washing) needs if nothing else. Whether you like them or not, get a rifle. if you just don't want to even think about it, do it anyway; get a $150 SKS, a thousand rounds of ammunition, put it in a foot locker and bury the damn thing if nothing else; that way if you need it, you'll have it. better than needing it and not having it, right? Ok, that's about it. now you have the ABILITY to survive without electricity, trips to walmart, no gas, etc. whether you will survive is up to you, but you are a heck of a lot better off than if you were living in the burbs in a house you can't pay for, heat, cool or grow food at.