When I became an adult, and was living on my own, whatever town or city that I was living in, I tried to figure out what was going on, what was happening, and what were the causes and reasons for what was happening.
Whether it was my hometown, a college town like Gainesville, a city like Tampa, or a mountain destination town like Flagstaff, I took an interest in the nicest, largest homes, the wealthiest neighborhoods, and I wondered who were the people who lived there, what did they do for a living, and how did they make their money?
The people who were able to afford very nice homes, nice automobiles, and enjoyed a high standard of living, I believed that if I could learn some of the things that they had done to become successful, maybe I could copy them or adapt some of the things that they had done, in order to become successful too.
Successful people who won the lottery or inherited a large amount of money from their relatives, you obviously can’t just copy that. Medical doctors who became wealthy as they got older, most people aren’t able to become a doctor in the first place. Wealthy real estate brokers, insurance company owners, car dealership owners, manufacturing company owners, and other business owners, these people caused me to wonder how they got started.
When I had the chance to talk to and get to know wealthy, successful business owners, it turned out that their success had a lot to do with being in the right place, at the right time, with the right idea, and a willingness to take risks at that time. There was some “dumb luck”, or “blind luck”, but these people also had an understanding or belief that their idea would work at that particular time and place, that came from their understanding of what was going on in the World, and the place that they were.
What I am trying to explain, is that if you want to be successful, you first have to understand where you are, what is going on, and what is happening where you are. You, the reader, are probably thinking that I am pointing out the obvious, thinking, “Of course people try to understand what is happening around them.” But, no, they don’t, not really. Most people just get an impression or idea in their head, and that is their conclusion. They don’t think any further, to test, challenge, examine, or validate their conclusions.
In Dickinson, North Dakota, where I am currently living, most of the people here form their opinion about reality from listening to their neighbors, friends, relatives, local politicians, community leaders, and Chamber of Commerce; from watching television news stations out of Bismarck and Fargo; from reading the Bismarck Tribune or Dickinson Press newspaper; or from what they see on Facebook or hear on the radio. These sources that I just mentioned are O.K. to get information from, but the impression that local people get from these sources, is their conclusion, they don’t think any further to examine, analyze, test, check, or question their immediate conclusions.
Concerning Dickinson, what the newscasters in Bismarck or Fargo said on the nightly news, what nationwide newscasters said, what local politicians, community leaders, company owners, business managers, and Chamber of Commerce representatives said in newspaper, radio, or television interviews, when their statements didn’t seem to match what was actually happening in Dickinson, I was angry about it, because people in Dickinson formed their understanding of reality and made their life decisions based on incorrect information that was being reported, written, said, and spread.
Questioning what newscasters in Bismarck, Fargo, or New York said about Dickinson, had they ever even been to Dickinson? It turns out, that most news reporters and writers for television, radio, newspapers, magazines, and journals were getting their information from local politicians, community leaders, company owners, business managers, and Chamber of Commerce representatives, a group of people who can’t or won’t ever say anything other than positive outlook statements.
The following misinformation was reported so often and repeated so often that most of the people in Dickinson still to this day, think that this is reality: One, “This oil boom is going to last for the next twenty years.” and Two, “Everyone working in the oil field is making $100,000 per year.”
The oil boom in North Dakota lasted from 2007 through 2015. This oil boom began once the price of oil was over $100 per barrel, it became profitable to extract North Dakota oil through the process of hydraulic fracturing. Once the price of oil dropped below $50 per barrel in 2015, it was no longer profitable for oil companies to drill and use hydraulic fracturing to produce oil.
The number of operating oil drill rigs in North Dakota went from over 200, to less than 50 currently. From 2015 through the present, residents in Dickinson still express the belief, “It’s going to come back.” and “It’s starting to pick back up again.” In the history of the World, there has never been an oil boom that lasted more than ten years in one place, but the people in Dickinson do not believe this reality.
One of the largest oil companies operating in the Dickinson area, is Whiting Petroleum. The stock price of Whiting Petroleum reached an all-time high of $370 per share in 2014. Last week, Whiting Petroleum stock was trading at $1.28 per share. In the past year, Whiting Petroleum laid off one-third of its workforce in order to cut costs.
Many people in Dickinson have believed for years that, “Everyone working in the oil field is making $100,000 per year.” This has never been true, and it certainly is not true now. This belief, and the belief that “It’s starting to pick back up again” has misguided many of the people in Dickinson, causing them to make bad life decisions.
Instead of realizing that the oil boom in North Dakota was a once-in-a-lifetime, short-lived deal, most of the people in Dickinson acted like there was no end to it. The sudden dramatic increase in local business, the sudden increase in demand for goods, services, and housing, allowed many local people to make windfall money, especially land owners and people who owned the mineral rights on land.
What did the local people in Dickinson do with their windfall money? Most of them purchased the most expensive, over-priced, top-of-the-line pickup truck, travel trailer, UTV, toy hauler, or snow mobile. Now, looking back on these purchases made in 2008-2014, roughly ten years later, all of these things are worth less than half of what they originally cost, and they are continuing to decline in value until they are nearly worthless.
Had the people in Dickinson known the truth, that this North Dakota oil boom would last from 2007-2015, they may not have spent their windfall money so carelessly and frivolously, and instead saved and invested their money so that it would last them for the remainder of their lives.
Another thing that happened in Dickinson during the oil boom, the housing prices doubled, then quadrupled. A house in Dickinson that might have sold for $75,000 in 2006, the asking price in 2012-2014 might have been $300,000. Some local people, and some out-of-state workers, bought houses in Dickinson at the peak of the oil boom real estate market. They did this, because they believed that the oil boom would continue, they had better buy a house now, the house prices would only continue to increase.
Now that the oil boom is over in Dickinson, a house that was purchased for $300,000 in 2012-2014, it might only sell for $200,000 now, or it might not even sell at $150,000. Most of the people in Dickinson are not making very much money now, many people have left Dickinson, and many people have job uncertainty.
Everyone in Dickinson needs to start over on assessing what reality is in Dickinson, what is going on, what is happening, what are the reasons and causes for what is happening. In my next blog post, Part II, I will start with the basic essential businesses, services, and employees in Dickinson, that which everything else is built upon, so that people can see and understand what is happening, and what is going to happen.