|Greetings Finite Worlders! Gail is on her 1 month lecture tour of China. She’s unable to access WordPress from China, but does have access to email, so she’s sending me updates to publish here on OFW. This is the second of her Updates to me from China. My Byline/About appears at the bottom here, but the China Travelogue articles are authored by her and all photos are from her. We will try to keep you updated as the trip progresses. -RE
I left on March 13, and it is now March 25, so I have been traveling or in China for 12 days now.
The short course I have been teaching is approaching its end point. I have given seven two-hour lectures to my class. Tomorrow, I will finish the last of my lectures (for 1/2 hour or so), and give a test for the rest of the period. The test will be multiple choice and short answer. The big concern I have is whether the students will know enough English to do well on the exam. One of the faculty has written translations for parts of the test, but there is still quite a lot that is not translated.
My plans for the rest of my stay here are still being finalized. I will be flying to Hohhot, Inner Mongolia on Friday, and staying through the week-end. That is about a 1.5 hour flight north-west of Beijing. One of the graduate students is from there. That is a big coal producing region, and wind energy is also produced there. The graduate student’s father is involved with wind energy.
There is also a plan that I will visit Daqing oil field with two of the professors, since that is a location that the professors are familiar with, and where they have contacts. The second trip will probably take place the following week-end (and a bit before and after), because the professors have teaching commitments during the week. In between, plans are still being finalized. One plan being discussed is an internal seminar with faculty/ grad students here; another is to try to get together with a fairly high level official that I met when I was here in 2011. I am doing other things as well. I have been helping Prof. Jiangliang Wang with a paper evaluating unconventional gas in China. (I have been a co-author on two previous papers with him.) And I am talking to graduate students about their projects, with the idea of perhaps helping them.
Prof. Feng would like to help me get my ideas together in an easy-to follow form. My lectures here have been videotaped (with me standing next to the slides), with the idea of putting the videotapes up on line, probably on OurFiniteWorld. I also have PDFs of my talk that can be put up on line, perhaps with notes added.
As I indicated previously, I am being treated very well. On Saturday morning, three graduate students and I climbed a nearby mountain overlooking a reservoir. It was not very high, and there were stairs leading to the top, so it was not too difficult.
There are a lot of people wearing clothing with American logos on them, or with writing in English on them. Some of the writing is simply an American brand name like Adidas. I haven’t noticed any clothing at all with Chinese characters on them. In one case, I noticed a Chinese brand (361 Degrees) on a some shoes, written in American lettering.
A lot of people know at least a little English, since English has been taught in the schools for quite a few years (10?). But many of the students are not very good at spoken English, because most of their training was with respect to written English and grammar. The students have received PDFs of my presentations, so have had a chance to read them, and look up words if needed, to try to understand what is being said. Students all seem to have English-Chinese dictionaries on their phones, so that they can figure out translations.
There is no cold water served here, except bottled water (probably because of potability issues, past or present). At every meal, soup of some form is provided, free of charge. This is sometimes eaten with a spoon, and sometimes drunk from the bowl. Hot soy milk is one common from of soup, especially for breakfast. There are several other kinds of soup, including egg drop soup and various forms of thin grain porridge. At restaurants, if a beverage is ordered, it is often hot water, served in a pot (like hot water for tea, but without the tea). The graduate student office keeps thermoses of hot water, to make tea. In fact, all of the offices on campus seem to keep thermoses of hot water. These are refilled by the dining hall.
The food is quite varied here, with more vegetables (and more kinds of vegetables) served here than in the United States. Fish tends to have a lot of bones in it; meat often has a lot of bones in it (or it is ground, and in a dumpling). I am willing to try quite a few things, so I haven’t had a problem with the food.
One thing I noticed is that the campus is not very handicapped accessible. I have seen a few buildings with ramps, but most of them have lots of steps. There are elevators, but they don’t necessarily stop at every floor. If you want to go to the fourth floor, you may have to go to the fifth floor and walk down a flight of stairs. Doorways may have bars at the bottom that a person has to step over. I asked about not seeing any students in wheelchairs on campus. I was told that the bus system wasn’t set up for handicapped people (and I doubt that the dorms are set up for handicapped people), so wheelchairs are few and far between.
The Great Firewall of China blocks a lot of websites–anything Google related, WordPress and Blogspot blogs, Facebook, Twitter, the Wall Street Journal, and I am sure a fair number of other sites. Our Finite World is available to read (but not edit) in China, but I have been having difficulty accessing it, apparently because of a weak WiFi system on campus. People who are accessing the Internet using an Ethernet cable are doing much better at connecting up with Our Finite World.
I commented earlier about the heat being turned off in the buildings on March 15. After being here a few days, I think that the reason for the cut-off has to do with the inflexibility of heat from radiators (probably hot water heat, using coal to heat the hot water). We in the United States in newer housing are used to systems where temperatures are easily regulated. But when the heat is either “off” or ” on” as it seems to be with radiator heat, the problem as the season heats up is that rooms quickly get too warm when the temperature outside rises. This is especially the case when there are a lot of people in a not very large room, with the sun shining in. Even with the heat off, there are times that someone opens a window to try to get the temperature down.
Smog levels have varied a lot. Today, the pollution level was high again, making it the third day out of the twelve since I arrived with a noticeably high smog level. I am feeling some effects in my sinuses. At this time of year, there are also some trees blooming, so my problem may really be a touch of hay fever.
I keep talking about diminishing returns in my talks. As I think about the differences between China and the United States, it strikes me that in many cases the difference has to do with diminishing returns. China has chosen the inexpensive way to do things, such as serving fish with lots of bones, not doing much to accommodate the handicapped, and using radiator heat put in buildings long ago. There is a more polished way of handling these issues, but the cost of making an upgrade may not be proportional to the benefit.
“There are a lot of people wearing clothing with American logos on them, or with writing in English on them. Some of the writing is simply an American brand name like Adidas. I haven’t noticed any clothing at all with Chinese characters on them.”
I have a decent quality Chinese pocket knife. A few tiny Chinese characters, but more visible is the text in English saying “stainless steel” and “folding knife”. Foreign is interesting in China as well, it seems – just like when people from the West wear T-shirts with Chinese or Cyrillic writings on them.
Our family is eagerly following your trip and I envy your trip to Inner Mongolia. I wish I could loan you a copy of the “The Wolf Totem” by Jiang Rong which is a semi autobiographical Chinese novel about the time during the Cultural Revolution where the principal character is sent to the area to join the nomadic people of the region. It gives a vivid history and feel of the area including all the way back to Ghengis Khan. It was widely read and enjoyed in China and has the second highest circulation of any book published after Chairman Mao’s little red book. Highly recommended. Have fun.
All the richer chinese cannot stand china themselves so they have second homes (and often second or more families) in usa and canada.
virtually who is somebody in china has a kid (and more or not the only kid) studying in north America.
Please don’t mix up emigration/relocation/pirate retreat on purpose with a mere and natural strategy of diversification. Very simply all the ~200K of world billionairs are diversified across contintents, asset classes, and even passports etc. It’s how the world works, no surprise there.
Sorry, the very top elite offspring is not studying ONLY in the US (perhaps with the exception of some special medical fields), they usually have wide spectrum of schooling behind them including world’s top institutions inside CH, FR, DE ..
Re-reading an old post and I think Gail needs to tip her hat and receive a standing ovation for this rather prescient analysis:
Hi all, both Egypt and now Israel have joined AIIB
Seems Rome is coming apart at the seems quicker than imagined.
Happy Spring, Passover, Easter if that’s your thing!
Egypt has no spare capital and they are no in Asia. Why are they joining? Just to thumb nose at U.S.?
As peakers, we seem to have one purpose, which is to spread depressing news that no one wants to hear. For China and Asia to emerge as a world power to replace U.S. hegemony would require them to make a lot of headway against the headwinds of thermodynamics. World energy will continue to decrease and so will world economic activity. It is very obvious really, the list of failed states continues to grow, Ukraine, Greece, Syria, Yemen, Iraq, Sudan, Egypt, Libya. How soon will it be till it includes all of Europe. China attempting to replicate U.S. hegemony is highly questionable at best. The real future is one no one wants to face and to put it mildly is quite depressing. The need is for people to face a deindustrialized future. The people have spoken; we will not do that.
This is what the beginning of collapsed economy looks like.
Of course most will say ‘but that can never happen here’
I bet you Yemenis said the same thing a few years ago.
Of course it can.
When the global economy collapses there will be no energy available. There will be little in the way of food or clean water available. There will be no jobs. Money will be worthless.
Collapse will look far worse than this and it will be global. Don’t expect aid agencies to help. Don’t expect the police to protect you
Man is a vicious beast. In the west the beast has been tamed because we have pillaged the rest of the world and kept the beast fed and for the most part sated.
Take away the bone and we will be no different than the people of Yemen, or Libya, or Somalia or any other failed state. We will, each and every one of us, try to survive. By any means possible.
Get ready to go back into the jungle. Are you ready for this?
Via Al Jazeera:
UN rights chief has said that Yemen is “on the verge of total collapse” as Saudi-led coalition continues to bomb Houthi positions.
“The situation in Yemen is extremely alarming, with dozens of civilians killed over the past four days,” UN High Commissioner for Human Rights Zeid Ra’ad Al Hussein said on Tuesday.
“The country seems to be on the verge of total collapse”.
Aid groups have warned of a humanitarian crisis unfolding with air and sea blockades making it impossible to send desperately needed assistance as casualties mount.
The UN children’s fund said that at least 62 children had been killed and 30 injured during the fighting over the past week…
But the spokesman for the Saudi-led coalition said it does not intend to kill civilians even though the Houthis had moved fighters into villages.
“Collateral damage can happen… but I confirm to you that the coalition takes all care,” said Brigadier General Ahmed Assiri.
On Tuesday, air strikes targeted two Houthi-held camps and Guard soldiers in the southern town of Daleh, a Guard airbase in the southwestern city of Taez and the Houthi stronghold of Dhammar, south of Sanaa.
On the ground, deadly clashes have broken out between the rebels and tribes, militiamen and residents who oppose their power grab, the AFP news agency reported.
Yemeni military officials said Houthi rebels have taken up positions overlooking the strategic Gulf of Aden, raising the risk they could threaten the global shipping route with heavy weapons, the AP news agency reported.
Sorry, that’s not comparable in the same time-space.
Yes, the west/north will get more sclerotic, less wealthy and healthy, more dangerous, relatively soon. However and for one thing, there is also tremendous path dependancy and intertia from the centuries of pre/industrial age, which will be utilized for several decades and centuries during the descent, the knowledge, materials, all will be cannibalized step by step. I’m not counting punctuation events like uprisings, revolutions and wars along the way. But that’s not the ultimate stage of collapse.
On the other hand Yemen did not have much of that to begin with.
Yes. Gail is fond of the Leonardo Sticks. When it comes to Yemen they are more like a small pile of sticks flat on the ground disconnected from the big dome. No one will miss them when they are gone. Yes, lack of small oil export from Yemen is a straw added to the back of the first world but only a small straw.
I do not agree with that.
Think back to Lehman 2008. If the central banks did not step in to back the global financial system the world would have been ‘Yemen’ in literally a few weeks. In fact the world would have been far worse than Yemen because the global economy and civilization would have collapsed.
And there would be no putting Humpty back together again.
When the next iteration of this hits, central banks will be powerless.
When you live in a globalized world, and a key pillar snaps, the sticks most definitely do fall down very very quickly:
KSA kills a few hundred civilians and everyone bitches, the U.S. kills hundreds of thousands of civilians and no one says boo. I see the U.S. navy is helping with the killing by naval bombardment. America spreading Sunni Islam of the Hanbali school.
Iceland is bit of an outcast by TPTB but somebody had to be first to jump the ship (or serve as the initiator if this is somehow planned global kick off event), for one thing it will create wider discussion and spread the basic information how money-debt is created from nothing inside the commerical bank system a key process, which still many people refuse to even look into and acknowledge.
Seeking alternatives to fractional reserve system by rulling party in the western world, you say crazy?
It seems we are getting near the phase shift, hopefully shouldn’t take more than next 1-2decades. The official pdf document is linked inside the Telegraph article as well..
“Iceland’s government is considering a revolutionary monetary proposal – removing the power of commercial banks to create money and handing it to the central bank.
The proposal, which would be a turnaround in the history of modern finance, was part of a report written by a lawmaker from the ruling centrist Progress Party, Frosti Sigurjonsson, entitled “A better monetary system for Iceland”.
“The findings will be an important contribution to the upcoming discussion, here and elsewhere, on money creation and monetary policy,” Prime Minister Sigmundur David Gunnlaugsson said. ”
WorldOf, we do remember this is the system required in the U.S. constitution? Though lost in the 1913 coup.
then it will be time for denmark to reannex Iceland.
It was made independent by America on 1943 when Nazis occupied Denmark.
72 years too late but Iceland will be returned to Denmark if the islanders act too uppity.
Latest Responses from Gail:
To Saibot March 25, 2015 at 8:52 am
You are right. Adidas is a Chinese brand. It is certainly widespread here. The writing on the products is always in English, even the name of the brand.
To Chris Johnson March 28, 2015 at 11:58 am
Thanks for your observations. Inner Mongolia was definitely very dry and windy, with temperatures that are reported to range from hot to cold. There is sand that will blow away, if there isn’t some kind of ground cover–the source of sand storms in Beijing, I believe.
When I gave the students their final exam, one of the short answer questions I asked was about whether the world economy would be bigger or smaller in 2030 than 2015. The vast majority said it would be larger. Even if they sort of understood the situation we are in, the would say things like, “We are in the Stagflation period now, but the economy will continue to grow past 2030,” or “The developing economies including China will continue to grow between now and 2030, even as some Western countries reduce their growth.” There was a very strong optimism bias.
To Rodster March 28, 2015 at 6:05 pm
I came very close to saying exactly what you are saying in my lectures. A country has to be the low cost producers. China is increasingly not the low cost producer. That is not a good situation, with lots of debt outstanding.
To Glenn Stehle March 29, 2015 at 8:13 am
You are right. Safe havens are going to be difficult to find, as we hit limits of several kinds simultaneously, particularly financial limits.
To richard March 28, 2015 at 7:59 am
You are right. If economic growth comes from true investment, it is hard to justify adding debt to pay dividends and buy back stock.
To edpell March 26, 2015 at 3:00 pm
How do you expect democracy to break out in Yemen if they have lost their oil exports? Look at my earlier graphs showing the peak and decline of Yemen’s oil supply. Water supplies are also depleted, and the population has grown. These issues are behind much of their problems.
To VPK March 26, 2015 at 10:13 pm
Unfortunately, I cannot read Wall Street Journal articles here. in fact, with the level of internet connectivity, I am having trouble with other articles too. I will have to wait until I get back, or look at quotes people send me. I have been reading Tom Whipple’s daily news summary, so I get the first paragraph or so from a variety of new stories. Thanks the the many folks who have been sending me articles of interest!
To Stefeun March 27, 2015 at 11:21 am
I agree that all kinds of investment, including so-called renewables require massive investment of energy. The only way we “know” the energy payback of this investment is through long term models and calculations using fairly narrow boundaries regarding the amount of energy used. It is extremely easily for researchers to mislead themselves–not see that they are using “renewables” to ramp up demand for coal and natural gas. A payback, if it exists at all, will be after many years.
To worldofhanuman March 27, 2015 at 1:13 pm
The slowdown is not entirely obvious. Students are worried about job opportunities, but there are still a lot of construction cranes operating. On the other hand, when we drove to the Ordos, Inner Mongolia airport, we traveled on a beautiful four-lane highway for many miles, without seeing another vehicle. The Ordos airports was also quite empty, and there were many spaces intended for stores selling souvenirs that were not rented. Ordos is in an area where planners had thought that coal production would greatly increase traffic, but instead it has shrunk back from its high point. I will be seeing more information regarding the economy before I leave.
To Bob Titley March 27, 2015 at 6:10 pm
So far, the evidence seems to be that China is following the model of the West. Everyone reads the same journals. Young people are being taught English, even though it is very difficult for them. The change toward two-child families is following the West, to some extent.
On the other hand, I met with people at an economic institute –I am not sure of the exact name. They seemed to be very interested in the lecture I gave there. They seemed to be interested in the possibility that old economic models would no longer work.
To Stefeun March 28, 2015 at 5:11 am
We definitely do have an unsolvable dilemma. Increasing illness, murder, and other harms helps the population problem. Not something nice to think about.
no Adidas is a German brand Gail 🙂 (and a very old one), and it was owned by Bernard Tapia (French) for quite some time until a few years ago
note : Tapie not Tapia(damned phone auto correct) , and this Tapie/Adidas story linked to a big money affair (C Lagarde also involved)
I give you the most concise summary of the current situation we are facing.
Pass this along to anyone who is in denial and ask them how to solve this:
HOW HIGH OIL PRICES WILL PERMANENTLY CAP ECONOMIC GROWTH For most of the last century, cheap oil powered global economic growth. But in the last decade, the price of oil has quadrupled, and that shift will permanently shackle the growth potential of the world’s economies. http://www.bloomberg.com/news/articles/2012-09-23/how-high-oil-prices-will-permanently-cap-economic-growth
BUT WE NEED HIGH OIL PRICES The marginal cost of the 50 largest oil and gas producers globally increased to US$92/bbl in 2011, an increase of 11% y-o-y and in-line with historical average CAGR growth. http://ftalphaville.ft.com/2012/05/02/983171/marginal-oil-production-costs-are-heading-towards-100barrel/
“15 ways the world will be terrifying in 2050”
Oceans in Crisis http://truth-out.org/news/item/29930-oceans-in-crisis-one-woman-will-cross-the-pacific-to-raise-awareness
Another good read: “Collision Course (Endless Growth on a Finite Planet)”
“The Days to Come” a movie that starts with the oil war in KSA. Good so far.
Funny movie, it appears Germany will have the most orderly apocalypse, as told by this movie.
Germany reached within a yard of becoming the world’s top dog on 1918 with not a drop of oil.
if anything they will reimpose the brest litovsk treaty.
Oil was nowhere near as important in 1918 and, like Britain, Germany’s industrial rise was coal-based … but oil was becoming more important and a race was on to secure ME oil fields and Germany was competing, including with the proposed Baghdad railway … amongst a complex of causes for WW1.
What I am saying is that your argument is invalid especially because, today, Germany is as much dependent on oil (and gas) as any other industrialized country. The base for industrialism – never mind the financial system – has changed a lot since 1918.
WW1 was fought over oil
Tohoku, opens department devoted to cold fusion. Hopes to bring products to market before 2020.
“We are determined to bring the application models to the market before the Tokyo Olympics in
2020. Our collective dreams are to provide the world with this clean source of energy”
And i am determined to make gold from lead with the first kg blocks ready by 2020. It is my dream to make gold from lead.
Anyone care to bet one ounce of actual gold that neither of us succeed?
The winner will not collect. Because this charade that we are going through will end well before 2020 and we will all be dead, or have no use for the ounce of gold.
I would be happy to bet we are both alive in 2021. Assuming you are in good health today.
Ditto to that. Now it could be a much different story 100-200 years on out.
You cannot eat gold, but you cannot print it either. If we are going to have a monetary system after this great failed experiment fails, what will it be based on?
But I do not have an ounce of gold to bet in the first place. I’m guessing that you do not either, which means that you shouldn’t be betting an ounce.
I most definitely do have an ounce or two of gold coins in my change purse.
It’s not edible but it’s probably going to be more useful than stocks, bonds, property, cash, and all other assets post collapse.
One would suspect that the next phase of the battle to delay the end of the world is now underway.
This surely is evidence that the central banks are actively trying to prevent the insolvency of energy companies by either purchasing shares directly or making ZIRP billions available to the energy companies to buy back their shares.
$50 oil = insolvency for most of the oil industry.
The marginal cost of the 50 largest oil and gas producers globally increased to US$92/bbl in 2011, an increase of 11% y-o-y and in-line with historical average CAGR growth. http://ftalphaville.ft.com/2012/05/02/983171/marginal-oil-production-costs-are-heading-towards-100barrel/
Sanford C. Bernstein, the Wall Street research company, calls the rapid increase in production costs “the dark side of the golden age of shale”. In a recent analysis, it estimates that non-Opec marginal cost of production rose last year to $104.5 a barrel, up more than 13 per cent from $92.3 a barrel in 2011. http://www.ft.com/intl/cms/s/0/ec3bb622-c794-11e2-9c52-00144feab7de.html#axzz3T4sTXDB5
Steven Kopits from Douglas-Westwood said the productivity of new capital spending has fallen by a factor of five since 2000. “The vast majority of public oil and gas companies require oil prices of over $100 to achieve positive free cash flow under current capex and dividend programmes. Nearly half of the industry needs more than $120,” he said
I was reading an article from Reuters today that said if the Iranian sanctions are dropped they could flood the market with their oil and drop the global price to $20 or less.
Sub $50 oil is just one tree in the wood. The price fell in part because demand could not increase fast enough to balance the economy. That is partially explained by the FED’s tapering of QE from March through September 2014. The hard part is understanding that the financial system needs to be reset to near zero to function efficiently again. That’s just the mechanics of money. That change will not fix finite oil supplies, only make rationing easier to implement.
As mentioned zillion times over, the sheer level of demand destruction factor took us all buy surprise. So, the global oily-debto-ponzi machine can sort of continue to work till mid 2020s, no systemic reset before that. However, it was suppose to happen roughly between 2005-2015 per majority of collapsnik theorists, simply premature bad call. For some this “delay” is very welcomed good news, while for others it negates their plans and schedules currently underway.
We may have a clearer view of the world in 2016 soon …
“(Reuters) – A possible surge in Iranian oil exports from an end to sanctions will reboot a struggle between top Middle East producers for Asian buyers, with Iraq looking the most vulnerable.
The latest twist to the saga of aggressive marketing is the world oil glut and low prices, likely to fall more with added Iranian crude, making Tehran’s battle for market share tougher.
“You cannot produce without demand. There is a limit in any market and also long-term contracts between Gulf oil producers and Asian refiners,” said a Gulf oil source.
“That’s why it is hard to imagine big volumes just eating into the market share just like that. Even if the Iranians offered discounts and sold on the spot market, there is a limit.””
@ worldofhuman said: “As mentioned zillion times over, the sheer level of demand destruction factor took us all buy surprise.”
What “demand destruction” are you talking about?
One must learn to take what the MSM says with a grain of salt.
The above is a graph of total global liquids consumption (crude oil, condensate and NGLs).
Not only is there no “demand destruction,” but there is not even a decrease in the rate of increase in world oil demand.
There are many moving parts that go into world oil demand, but it looks like US demand may be poised for some pretty healthy gains:
“US Oil Demand Is Alive And Well”
Perhaps you were not present when it was discussed over here numerous times, simply the demand destruction in west/north is quite apparent. Unemployed, underemployed youth is not buying cars and driving like crazy around. Plus the wealthy – boomers are increasingly past the frivolous activity spending age activities like long distance vacations, sportcars/airplanes, mobilehomes etc., they usually now spend the money on their own healthcare or helping out offsprings not to starve (PIIGS).
Also most of the residential and industrial RE in OECD countries has been at least partly upgraded via energy saving remodeling and equipped with low energy appliances etc.
Coal and natgas is beyond cheap, gasoline/diesel is cheap.. however there is still no pickup in energy burning activities of the past..
This phanton “demand destruction” which the MSM has evangelized ad nauseaum is like Erewhon, it is nowhere:
Here is what “demand destruction” looks like:
Yes, there is a limit to how low demand can get if we are to maintain our industrial society. But how does the consumption curve fit in with population growth?
The world popuation is growing at a slower rate than it was in the 1980s:
And in abolute terms at about the same clip:
And here’s a graph of world per capital oil consumption:
‘Per capita’ oil consumption, not ‘per capital’ oil consumption. There’s so much fictitious capital these days that the “per capital” oil consumption has undoubtedly declined substantially.
And I wonder what that per capita world oil consumption graph would look like if we substracted the amount of oil consumed to produce the oil consumed. Beginning in the naughties we began shifting from predominately conventional oil production to non-conventional oil production (e.g., shale oil, Alberta sands, deep-water, etc.) which has a much lower EROEI than conventional oil. I have a hunch it would look like the orange line penciled in on this graph:
And one must wonder what net per capita oil consumption would look like, after the amount of oill consumed to produce the consumed oil is substracted. I have a hunch it would look something like this:
“For consumers, experience suggests the acceptable oil price zone is $40 to $60 in today’s dollars: higher than that, and goods and services (particularly transportation) become more expensive than current spending patterns can handle. For producers, the acceptable zone is more like $80 to $120: lower than that, and upstream investments make little sense, so production will inevitably stall and decline.”
These are pretty specific numbers, what are your thoughts Gail ? Also, I expect producer numbers to increase over time, but I don’t know what the rate over time would be. 5% yr over yr ? Thoughts? TIA, Jonzo
We are still in the Goldilocks zone for coal. The U.S. has lots of coal.
Speaking of miners, and QE messing up the process if value-based investing …
“In a lengthy bear market for mining stocks, there have been repeated calls by pundits for the culling of hundreds of companies that have been unable to raise new money or generate shareholder value. This piece of the capitulation process, some say, is what is needed to put confidence back in the market so that the bull cycle can start again. Tony Simon, President of Seguro Consulting, has put together a report that has rather concerning findings for those interested in the venture markets. The chief finding in his report is that there are 589 companies (roughly 40%) that should no longer be listed as they do not meet the continuous listing requirements required by the exchanges.”
Just went to the mall here 100 mile of NYC. About 25% of the store are out of business. One of four anchor stores JC Penny is closing. Sear, an anchor store, on a Friday night has no where near enough customer to keep them in business. It does not end with a bang but a whimper.
100 miles north
That depends on your perspective and where you happen to be located. It’s ending with a very BIG BANG in Yemen right now, in fact many of them courtesy of the Saudi Air Force equipped with the full Death From Above arsenal by the FSoA MIC.
Gail likes to put up the Leonardo Sticks pic as a representation of what is occurring, but IMHO it’s not a good analogy. This is an edifice that is collapsing from the outside inward. It appears to be collapsing slowly at the foundation level inside the FSoA here, but at the upper stories it is coming down quite rapidly. The Jenga Tower is the better analogy IMHO.
Run Away. Run Away FAST. RUN AWAY NOW!
I tend to relate to the Leonardo Sticks better as it explains how interconnected the entire global econmy is and removing one or two pieces can bring everything down.
in my mailbox, instead of the picture of the collapsing Jenga tower, I have this link: http://www.doomsteaddiner.net/forum/index.php/topic,4493.msg71410/topicseen.html#msg71410
which leads to an article by Ugo Bardi, “On Climate Change and World Hunger.
BTW, I like Bardi’s article because he takes the example of world hunger to show that an uncomplete analysis of a complex problem leads to apply bad fixes that can help improve it in the short term, but likely makes it much worse -or insoluble- in the future.
Now, this “future” is TODAY, so let me quote Al Bartlett:
“Anyone here for promoting disease? (audience laughter)
We now have the capability of incredible war; would you like more murder, more famine, more accidents?
Well, here we can see the human dilemma—everything we regard as good makes the population problem worse, everything we regard as bad helps solve the problem. There is a dilemma if ever there was one.”
Note he’s talking about the population problem only. Suppose that we were able to fix it in a sufficiently short period of time (don’t ask me how!), it would likely trigger financial or other problems that will eventually bring the whole system down. Except maybe some small remote parts that are not “financialized” at all (yet).
On another hand, doing nothing will lead us to the same result.
So we should consider that BAU is already over and that “humanity’s focus should now be more on resilience than on sustainability. It is far too late to achieve sustainable development, as that term is commonly understood.”
(Dennis Meadows, quote from: https://citizenactionmonitor.wordpress.com/2014/12/03/it-is-too-late-for-sustainable-development-world-renowned-dennis-meadows-explains-why-video/)
Personally I doubt that we could build up sufficient resilience to withstand the magnitude of the multi-shocks to come almost simultaneously, due to the many tensions, of different types but all interconnected, accumulated in our complex system.
But of course, anyone can try! (and go grow crops in South-NZ..?)
Last paragraph is my opinion only.
Not sure why the link to the forum shows up with one of Ugo’s articles…maybe because I used the pic as a Feature Pic for the Homepage.
The lack of any real good solution other than a lot of DEAD PEOPLE makes the problem quite intractable. Even the “slow” reduction of population via demographics with a low birth rate and higher death rate has its own set of problems.
The most likely solution provided by Nature right now is a Global Famine that will wipe out many people rapidly. Whether those remaining people can make a go of it with ongoing climate change is an open question.
Also as always the biggest bear is the timeline question, when it begins in earnest and how long it takes. I still think Guy McPherson’s 2030 timeline for NTHE is way too short.
“Also as always the biggest bear is the timeline question, when it begins in earnest and how long it takes. I still think Guy McPherson’s 2030 timeline for NTHE is way too short.”
I tend to agree! Maybe another 100-200 years, who knows for sure. I still think what will get us will be a polluted environment. That’s why I keep looking at the oceans and how we are killing them off with the millions of tons of plastics and toxins that’s dumped each year.
This feels like my understanding of 1913. A lot of big egos spoiling for a fight. We may not have to wait for the environment to kill us. We may do it ourselves.
Yep, that’s a point discussed here numerous times. Especially for non US/NA world inhabitants, it’s pretty evident that the post WWII (and earlier) arrangement is broking down on several fronts/levels, firstly in perifery countries and this trend of instability is moving to the core areas. On the other hand it also works in reverse, few decades ago it would be almost unthinkable to imagine events such as the Balkan wars and the recent/current carnage in E.Ukraine, not mentioning those “distant” and “savage” events in ME, however even the western public is being saturated slowly by images of rotten bodies, pensioners grabbing dirt/food near the battlefields, destroyed houses and city infrustructure etc. which goes on much closer to home these days. So, should this come to them very personally at some point of time, the psychology is already somewhat predisposed to it.
Thanks Gail for your realistic view of China. I’ve recently undergone a change of mind regarding China. I had been tempted, as many have been by the view that China could be the world’s next great empire, but I have seen the error of my ways. I am wondering if more than just me are waking up to the idea that the emerging counties of the world are not going to be the salvation of the world but will actually go down ahead of us.
I am also currently wondering if the fact that I am waking up to the idea that the emerging world is in fact beginning to seriously fail is not also being recognized by the wall street crowd and that as they become aware that there really is no hope it will be reflected more and more in the stock market.
A post over at the doomstead diner posits that what is needed for us to be a little more resilient as the collapse unfolds is local currencies that will provide us with a method to maintain some kind of economy in a world where the petro dollar and American empire are beginning to disappear.
Here 100 miles north of Wall Street many farms are owned by the Wall Street crowd. They of course do not work them they have staff for that. They always upgrade the mater’s house to be beautiful with immaculate grounds. They have sale distribution that they will modify as needed as the slide down progresses. They are smart people.
What’s the Defense Plan for these Doomsteads when the local National guard troop shows up looking for new headquarters?
RE, you are right organized crime is always the problem.
They are smart but not smart enough. Or, rather, the real problem is that they don’t have enough social feeling to really protect themselves. They can’t lose sight of their status and social standing, everything they do is geared to maintaining or enhancing this, and this will be fatal.
Insofar as it is a matter of intelligence and rational planning pure and simple, they don’t get how interdependent they really are. If they were smart enough to really grok this, then even lacking the necessary social feeling, instead of thinking of themselves as supermen with fortresses of solitude, it would be better if they conceived themselves as “lords of the manor” and took seriously the fact that they needed a healthy, doing-okay pool of skilled labor ready to hand to work the land they own and provide the support on which they will ultimately depend.
To wit, it would be better if instead of leaving all of their chits in the “market” to make more chits, they took a few tens of millions and invested in building a resilient community for a radically relocalized world, where their “retreat” is located. In addition to training and providing work to the locals in permaculture and livestock management , they should be creating the ability to make their own clothing by re-introducing hand weaving of locally produced wool, hemp, etc., tanning and leatherworking, making sure there is a very well stocked public library with a full suite of medical, dental, chemistry, engineering, science, agriculture, permaculture books, etc., supporting and making sure there is a quality local medical facility, preferably one with doctors and pharmacists already thinking about what those practices should be in a post-oil world, and making sure there are a few people on hand who know waterworks and who can build and maintain waterworks, etc., helping the local government to stockpile some good supplies that will help in a transition, etc. There is no end of things such a wealthy person could do, if only the right attitude existed. A lot of the agricultural and clothing activities can be structured as businesses designed to produce and sell “artisanal” hand made products, but the ultimate goal of course would not be to make profits but to build the community up for the world-to-come, and for the rich family to position themselves as benefactors IN and OF the community, with people’s interests in mind, and cultivating a “we’re all in this together” feeling and the ties that bind. In short, these rich people would do better if they actually adopted feudalism as their mindset and approach than what they are doing, which ultimately only antagonizes the locals and will lead to the result RE refers to.
Apart from that really basic flaw in their “intelligence,” I am also not sure that being about 75 miles north of the Indian Point nuke facility is “smart,” but there aren’t a lot of options for avoiding nukes in the Eastern U.S. (I myself am in the NYC metro area, but plan to retire elsewhere.) However, it is a probably as good a bet as can be made to expect that when TPTB wake up to the fact that they are going to have to do something with that waste, NOW, assuming that it is still possible to do something at that point, the places near the Washington-Boston megalopolis will probably receive priority.
Do they have not only farmers, but cobblers and weavers and tailors on hand? Are they willing to eat moldy bread if they get a bacterial infection? Can they, themselves use weapons to defend themselves? I’ve really looked into life without oil and coal, and it requires looking at the world very differently.
I’ve thought about it as well.
We pampered, soft, weaklings are going to be forced to live like pre-industrial man.
But without any of the skills and knowledge that such men had.
I am hopeful that the spent fuel ponds exploding will preempt this misery.
“Political campaigns to reduce the growth of the human population are decreasing, not increasing. The most effective of all, China’s policy of one child per couple is relaxing and and only a third of the population is subject to this limitation (Source: The Australian ).”
Regarding Daniel Hood’s observations about China and demographic implosion: interesting topic…China has led the world in having to face population pressures and limited resources. They have talked lately about abandoning the one child policy, I believe due to concerns over this approaching demographic problem. But consider this notion…I can’t recall the exact figures, but robotics and automation penetration of manufacturing and business processes in the western developed countries is about three or four times that of China. I believe that is one reason (among several) for our suppressed wages (a robotics tax anyone?)….but China has built it’s economy on cheap labor, and is only now beginning to deploy robotics and automation. If they handle it nimbly, perhaps productivity with robotics can increase dramatically enough at the same time as declining work force /population ratio to compensate and maintain a healthy economy. If that could happen it could help create a new non-growth oriented economic model. China so far seems to have been trying to emulate western economic models, architectural and lifestyles, which is, frankly, an enormous tragedy. Gail it would be interesting to here if you perceive any reaction or kickback from people about that issue…too much westernization, too much western financial influence.
Bob Titley says: “China so far seems to have been trying to emulate western economic models, architectural and lifestyles, which is, frankly, an enormous tragedy.”
Here, however, is an interesting scenario of what the future might hold:
“And then, there are the ideologues. They are, of course, vastly more culpable than the scientists. Here, The ‘Collapse of Western Civilization’ picks up a theme from ‘Merchants of Doubt’: Free market ideologues, trained on the idea that the Soviet Union was the root of all evil, converted to an economic religion of their own dubbed ‘neoliberalism,’ defined as ‘the idea that free market systems were the only economic systems that did not threaten individual liberty.’ Unfortunately for this worldview, market failures do exist, and climate change is the granddaddy of them all. But too many neoliberal ideologues couldn’t accept that, so they doubled down on fantasy. (These are the climate change denying libertarians that we all know so well.)
“In ‘The Collapse of Western Civilization,’ neoliberals receive a comeuppance for this that is appropriate in its dramatic irony. The book ends by noting that China, a country not exactly wedded to freedom of thought or free markets, nevertheless survived climate calamity the best, thanks to its ability to exercise the centralized power of the state to force rapid climate adaptation. Eighty percent of Chinese thus survived the climate cataclysm. Other nations soon followed suit, also growing more autocratic.
“Oreskes is not applauding this, of course; rather, she’s suggesting that it could be a very, very painful irony resulting from the behavior of neoliberals. ‘It could well be the case that the authoritarian nations are actually better situated to deal with climate disruption than the liberal democracies,’ says Oreskes. ‘And we want to suggest that that’s a very worrisome thought’.”
Remember that China is about the same size geographically as the U.S., actually slightly less arable land, and what, five times the population? I believe that underlying reality explains much about China, as well as its history of the last few hundred years. As for cold water..I think that is an American taste…I know in the eighties in Prague if you asked for ice they brought you ice cream! I think many cultures prefer room temperature or warm water to cold.
I was told many prefer room temperature water because you don’t perspire as much if you are in a hot climate which keeps one from losing the intake of water thru their pores.
Dear Gail, thanks for posting the updates.
Given the apparent slowdown in China, and recent talk by IMF? that world must definately expect from now on much slower (and desirable) growth forwards, would you please try to connect it with some real world observation on the ground level so to speak, perhaps few questions asked to your colleagues/students over there is it already noticable somehow? Are chinese feeling this “overall plan” issued from their big government (and international institutions) in some practical manner already, are they discussing the implications? In particular the possible flight to “quality over quantity”, i.e. russian linked gas for power generation instead of dirty coal, more refined consumer products and services bound for domestic market instead of increasingly saturated/impoverished western markets, former sweatshops outsourced/moving to other countries like Myanmar, Africa etc.?
Ongoing Commodification of the Commons
The commodification of the commons will represent the greatest, and most cunning, coup d’état in the history of corporate dominance – a fait accompli extraordinaire of unparalleled scale, with unparalleled repercussions for humanity and all life.
Further, it matters little whether or not the money is moved from direct investments in fossil fuel corporations to so-called “socially responsible investments.” The fact of the matter is, all corporations on the planet (thus all investments on the planet) do and will continue to require massive amounts of energies (including fossil fuels) in order to continue to grow and expand ad infinitum – as required by the industrialized capitalist economic system.
The windmills and solar panels serve as the beautiful (marketing) imagery, yet they are somewhat illusory – the veneer for the commodification of the commons, which is the fundamental objective of Wall Street, the very advisers of the divestment campaign.
More (much more!) on Cory Morningstar’s blog “The Art of Annihilation”:
Some (all?) of her articles are published on “Counterpunch”
Solar panels are not beautiful. They are ugly. People are cutting down acres of forest and covering the scraped bare ground with ugly industrial artifacts. People are getting $20,000 per year rental for allowing this to happen but the lessees seem to be financial middlemen like stock brokers and mutual fund managers. The leases are backed by tax credits which are backed by what? State laws? Anybody ever actually seen one of these leases? What guarantees the 20 years of payments if state laws change and who removes the panels and restores the land?
It is one thing to put these things on dumps and buildings. That is ultimately useless but not as pernicious as cutting down forests and orchards.
Oil producers are leaving China
Shell and a host of other companies are scaling back projects in China due to the collapse of oil prices, making these less attractive investment in China
Democracy threatens to breakout in Yemen but axis of money (KSA, Israel, U.S.) pledge to bomb it back to the stone age.
A black swan event? Bank of England is worried
The crisis in Greece, a slowdown in China and the eurozone are the main international risks to the financial system, says the Bank of England, which is concerned that markets could suddenly seize up and a pose a threat tostability.
As the Bank’s financial policy committee – established to monitor risks in the system and chaired by bank governor Mark Carney – published its quarterly update on its assessment of the markets, it said that the annual stress tests on banks would focus on such international risks.
The scenarios will be published on Monday. Last year’s stress tests were more focused on risk from a slowdown in the UK economy and collapse in house prices.
In its statement following its meeting on 24 March, the FPC said: “International and geopolitical risks to financial stability in the United Kingdom persist. Despite recent encouraging signs, the risk of a low nominal growth in the euro area persists.
“There are also risks associated with a further slowdown in China and to some emerging economies as the stance of monetary policy begins to diverge globally. There also remain significant risks in relation to Greece and its financing needs, including in the near term.
“Any of these risks could trigger abrupt shifts in global risk appetite that in turn might lead to a sudden reappraisal of underlying vulnerabilities in highly indebted economies, or sharp adjustments in financial markets,” the Bank said.
Investors are assuming that they will be able to buy and sell assets easily, the Bank said, even though “liquidity in some markets may have become more fragile”.
“This could lead to heightened volatility and undermine financial stability. The committee judges that there is a need for a market participants to be alert to these risks, price liquidity appropriately and manage liquidity prudently,” the Bank said.
Link those thoughts to the tendency of CEO’s to borrow to either pay dividends or buy back shares (instead of investing for the future), and expect soaring assets with stagnant or shrinking real GDP, and the related demand for energy and for goods transport.
Just to add a bit more colour to that …
“Will durable economic growth and inflation emerge in Europe causing German rates to rise or will the U.S. remain in a secular economic stagnation causing U.S. rates to converge lower with those currently seen in Europe and Japan? Our view is that there are a multitude of forces that will drive rates lower in the U.S. thereby collapsing the spread.”
CEO’s should be buying back shares when they believe the company is undervalued, and with stock markets at all time high’s, well, that just seems like another 5-sigma event.
Absolutely very interesting and thank you both, Gail and “RE”, for taking the time to share her insights and insights regarding her visit.
Just heard an interesting interview on a local Public Radio show with host Mike Collins called “Charlotte Talks” with a think tank corporation CEO Mr. George Friedman, who runs “Strandford”, predicts world events. Here is the link for those interested to listen
Has some interesting observations regarding China in their conversation toward the last part.
Also, Yesterday listen to conversation regarding a battle over funding of roads in South Carolina, which has the fourth largest system funded at the public level. Seems Gail is correct that this will be a crucial part of the network that will see failure in a breakdown.
State Sen. Ray Cleary, R-Georgetown, said he plans to put several proposals into one package to be considered by the Senate Finance Committee next week.
Cleary said those proposals include:
• Increasing the state gas tax by 12 cents a gallon over three years, and indexing that increase to inflation. The increase would be suspended if S.C.’s gas tax ever rose above a neighboring state’s gas tax.
• Increasing the fees on driver’s licenses, bought every 10 years, to $50 from $25.
• Levying an annual $60 fee on hybrid vehicles and a $120 fee on alternative-fuel vehicles.
• Increasing the state’s sales-tax cap on vehicles to $600 from $300; Simrill’s House proposal would increase the cap to $500.
At a press conference Thursday, Haley said that Cleary’s plan includes “a whole lot of tax increases.”
“We will let everything fall to the wayside before we allow the people of South Carolina to see a tax increase,” she added
Read more here: http://www.thestate.com/news/politics-government/politics-columns-blogs/the-buzz/article15511007.html#storylink=cpy
China has an opportunity with molten salt thorium reactors. But I have not heard any news about their development work in the last year.
Molten Thorium reactors are Pie in the Sky. There are precisely ZERO Thorium reactors producing electricity anywhere in the world and only a few prototypes were ever constructed decades ago. If they could have been made economic, they would have been built years ago. My guess is to scale up that technology to a commercial size electric plant is outrageously expensive, and Konsumers couldn’t afford the electric bills. It doesn’t make bomb grade material, so you can’t subsidize by selling nuclear bomb material to the MIC either. This one has only fractionally higher possibility of coming to the rescue than Cold Fusion.
Absolutely RE, but there are hard-core true-believers for many things – dare I mention Tesla and Judy Woods perhaps – who cannot let go.
The thorium thngy has been pushed many times in OFW, though I’m not sure by edpell before.
I have mentioned it before. I like it. No one is funding it. The Chinese effort seems to have died when the father of the project manager was brought up on corruption changers.
Even if your faith is well-placed, can’t you see that it is just to keep the current economic system running?
It is actually collapsing on all fronts and even the most abundant resources on this planet will eventually be exhausted, regardless of how extraction is powered.
We have a finite world, why don’t you understand that?
I’m in no hurry to watch my wife and children starve to death while I also starve to death. Let’s kick the can down the road some more.
RE, 🙂 speaking of cold fusion. Alexander Parkhomov of Moscow, Russia, is having spectacular success with nickel power and LiAlH4 at 1400C. If this is replicated by a few other labs the world will be changed.
The 19th annual Cold Fusion conference will be held in Padua, Italy, April 13-17th.
I’ve been waiting 50 years for this! I’m sure they will figure it out in the Nick of Time!
Cold fusion may well be real in the Rossi and Parkhomov experiments. However, one thing I do not see addressed is how much energy is used to extract and refine the reagents used in the E-Cat. If the energy invested in creating the reagents exceeds the excess heat produced – then the device is useless. Another issue I have is (that so far as we know) this E-Cat is only producing heat and this does not help at all with our current issues of resource depletion. To convert the heat to do useful work will involve losses. In addition, we would very likely have to rebuild much of our existing infrastructure to begin using energy create from the E-Cat (you can’t pour an E-Cat in your fuel tank and go). Even if the E-Cat produces energy of some form – how specifically can the E-Cat help with food production, resource depletion, infrastructure building and maintenance, restoring biodiversity, reversing soil erosion, sequestering CO2 etc? Energy is just one component of the problems we face.
I do not have a calculation for you but the output is nuclear ~18,000,000eV per atom versus oil and such at 1eV per atom. Nickel powder cost about $15/pound and the cost of Li is about $6/pound. So not more than $21 worth of energy to produce call it half a barrel. Energy out roughly 33 barrels of oil equivalent. So EROEI=66 conservative estimate.
‘Spectacular’ Why don’t I see this on the home page of FT.com or Bloomberg or……….anywhere
Surely if it was spectacularly successful it would merit a little coverage?
Please do come visit us when one of these theories actually pans out.
Degenerate grandson , There are many subjects the MSM does not cover. Why would their non coverage of any event be a indicator for its truth or non truth?
Oh gawd not the E-cat rehashed? Didnt we finish this once before? If we had a technology that gave EROI 66 what in the world would keep it from proliferating?
I suspect they would cover a revolutionary new energy source.
Heck they run a lot of rubbish on solar power as the saviour and it is nothing of the sort.
When there is a replacement for oil, the MSM will cover it.
And all the big venture capitalists will line up to pour money into it because this would be google/microsoft/facebook/twitter/linkedin x 1000000000000
If this is being kept secret you’ll have to explain why.
Speaking of the limits of technology, some may recall I have posted about the bicycle fairing I have been tinkering with- a wholly appropriate technology so long as there is metal and solar forging technology available. I finally perfected a lightweight fairing for my recumbent bicycle. It has a fiberglass nosecone and coroplast side panels (for which reneable substitutes exist). I have been riding it for a week on my 24 mile round trip commute. It is fast-very fast. At 60 years of age I have little trouble holding 25- to 30 mph on the flats. I have to brake on hills (50+ mph without much effort) to keep from scarring myself to death. Ah, but there is the first limit to the efficiency I wanted. A second limit to full appreciation of my invention is that cars generate so much turbulence on the busy road that I am constantly jostled by the fluctuating drafts. The speed is dangerous enough. To compound that, crosswinds catch the broad sail that the side panels present and destabilize me, throwing me off course – which at high speed sends me into the other lanes. Upshot is that I will go back to a partial fairing because, like Angelina Jolie’s very brave example, I want to live to see my kid grow up.
I should mention that most full fairings are built around a three wheel bike for stability. However with three wheels there are substantial energy penalties for friction (the third wheel) and weight. All in all, though, the bicycle is orders of magnitude more efficient than the car. Google bamboo bicycles!
Got Pics and/or Vids you can post up?
Or : http://www.bloomberg.com/news/articles/2015-03-18/japanese-engineers-reinvent-the-wheel
Please post photos! I just got my three wheeled recumbent out of the snow covered shed and took the first spring ride yesterday. I would love to get a good fairing or even something to keep some rain off tho I don’t want a real velo cause it gets too hot in there. I absolutely don’t want to go more than 20+- mph.
My town’s energy committee is going to have a bike show at the end of May consisting of folks over 60 who are still biking.
It was outrageously expensive to scale up uranium reactors to commercial size. The costs there had already been sunk by the time that thorium became a research topic. To say that they could not be made economically viable to the degree that uranium reactors have because they haven’t is wrong. People really do not like change, especially when they have already sunk the costs on something else.
I used to work for a company that did non-destructive testing on various parts, including automotive parts. We had a system (ironically, based on technology out of Los Alamos that was developed for testing plutonium pits,) that worked better than the industry standards. One of the engineers at a parts plant told the owner of this company “You know, your stuff is more accurate and cheaper than other methods, but it doesn’t match x-ray testing, can you make it match x-ray testing?” Our stuff was far more accurate than x-ray testing, but he wanted it to match x-ray testing because it was the “industry standard.” We had another engineer at a company try to argue that the results of actually testing parts by physically breaking them was wrong because it didn’t match the finite element model. I’ve seen too much stupidity in industry to accept the argument that just because something hasn’t been done that it cannot be made economical.
The uranium reactors themselves were never economically viable. They got subsidized by the military buying weapons grade material for the nuclear arsenal.
How many new reactors of any type have been built in the FSoA? The last new one was Watts Bar 1 in TN in 1996!
Besides the fact the reactors themselves aren’t economically viable, you have the whole issue of the distribution infrastructure, itself falling apart. Where is all the CapEx going to come from to build Thorium plants which have never been scaled up to commercial viability AND rebuild the transmission network? You’re going to issue out more debt to do this? What? It takes less debt to keep Fracking up remaining Oil, and the debt is running out to do that, because the consumers can’t pay it off!
You never get something for nothing, and running up debt doesn’t make this model work anymore. It’s a dissipative structure overall, not a productive one, so when the stored energy reserves drop too low, the engine grinds to a halt. I covered this in the Thermodynamic View of Money article.
Also, don’t miss the latest Rant on Great Statesmen!
I agree that it is too late on the infrastructure bit. Even if we did find a viable new energy source, we’d still get a collapse due to the time it would take to put in the new infrastructure, unless it was somehow something that was readily convertible into something that is gasoline or diesel like and easy to get at.
But my point with thorium is that it hasn’t been tried, except for a few research reactors. You cannot really make any calls on whether or not it would be economical until they are developed in earnest. There are arguments that they could be cheaper. They lack the need for enrichment, for example, and that is a massive cost with uranium reactors. They would also probably need less in the way of containment structures. But then again, there are the development costs, and that hump is probably too big to get over today, but it may or may not have been 40 years ago.
As for using them to get a nuclear explosive, we didn’t have the technology to enrich the U233 well enough 40 years ago, but we might today. The issue, and this was tested in an actual bomb that used some plutonium and some U233, is that there was enough U232 that did not get eliminated and it poisoned the reaction. We do have newer, better enrichment technologies these days, though the extent that there are facilities that use them is something that I do not know.
If any form of industrial civilization is going to survive the rapidly approaching bottle neck, it will be based on local economies when it comes to necessities, recycling and probably mining landfills, kinder ecological practices and nuclear power for both electricity and manufacturing liquid fuels. But we will still go through that bottle neck, and even if somebody does figure out how to pull it off, life will still be very, very much different.
I have a problem going to the dump. There are always people there throwing out more good stuff than what I am dumping and I return with as much as I deposit. I have actually seen people pay to deposit horse manure. I have seen people bring antique cherry wood furniture to the dump. (dump employee risked his job and snagged those)
I’m hoping my memory is correct on this. I read some time back that Thorium is not well suited to work in a reactor, because of the physics of the reaction, and because some of the by-products are quite nasty. Not my field, though, and I hadn’t thought to keep a link.
Thorium is fertile, not fissile, so you need a fissile material to kick start the reaction. We have tons and tons of nuclear waste that can overcome this that is just sitting there for political reasons. We could be reprocessing it and using it for both uranium reactors and thorium reactors, but we do not have a viable design for thorium reactors and compared to fossil fuels, uranium reactors ain’t cheap, at least on a historical basis. Coulda woulda shoulda. Had we started a few decades ago, would could have mitigated some of our energy problems. I don’t see how that would work for the entire world given other limitations, but we could have made it so our descendants are better off. Those who survive anyway. As for the by-products being quite nasty, yes, they are very nasty, but when you are talking radio active, the more nasty, the faster they go away. Thorium reactor (and uranium if you had a fuel cycle that burned EVERYTHING up) would be a lot worse right out of the reactor, but it would be safe after a few centuries rather than the hundreds of thousands of years for uranium based reactors under current fuel cycles.
Handicap access is a luxury for a society, as are old age support, food/housing/education/medical for the unemployed and unemployable. The only right is the right to pursue happiness not be given happiness.
edpell says: “Handicap access is a luxury for a society, as are old age support, food/housing/education/medical for the unemployed and unemployable.”
Nah. That is, at least, if we look at empirical studies and not the simpleminded folk mythologies spun by intellectual lightweights like Ayn Rand, Richard Dawkins or Friedrich von Hayek.
As Hilliard Kaplan and Michael Gurven note in “The Natural History of Human Food Sharing and Cooperation: A Review and a New Multi-Individual Approach to the Negotiation of Norms,” what empirical studies reveal is that “persistent imbalances in amounts given and received between families suggest that strict reciprocal altruism cannot account for all food sharing between families.”
“[E]ven among men of the same age,” the researchers add, “there must be net transfers over the long term from families producing a surplus to families producing a deficit.”
Kaplan and Gurven conclude that “the human life course could not have evolved without long-term imbalances of food transfer within and among families.”
“[H]igh levels of knowledge, skill, coordination, and strength are required to exploit the suite of high-quality, difficult-to-acquire resources humans consume,” the authors explain. “The attainment of those abilities requires time, a significant commitment to development, and a large brain to support the learning, information processing, and planning underlying those skills.”
“If families had to ‘balance their budget’ at every period, they would either have had to lower their fertility for force their older children to fend for themselves. This would most likely increase childhood and adolescent mortality and lower rates of skills acquisition…. [T]here would be no way to buffer the risks associated with the stochasticity of family size and child demands.”
Here’s a link to the full paper:
I like the graphs Fig.1 & Fig.2 at the very end of the paper, and explained in resp. p.13 & p.14.
I wonder to what extent one could connect this “food debt system” (and subsequent socialization) with the success of our species, and find similarities/causalities with our current global financial debt-system.
Total to raise $15 billion in China for Russian projects
(Likely in EUR or/and RMB, not USD)
“French oil and gas producer Total is looking for $15 billion in investment from China to pay for expansion in Russia, the company’s CEO Patrick Pouyanne said. This could be the largest private corporate deal involving Chinese banks.
Total wants to expand the financing of the $27 billion dollar Yamal LNG project in Russia’s Siberia, said Pouyanne in an interview with the WSJ. The company says it’s possible the funding will be in either euro or yuan. (…)”
I don’t think natural gas price is holding up very well either. Yamal natural gas is expensive gas. I wonder if any debt that is taken out for it can ever really be paid back.
That is strange, on my blogspot i have 3038 hits from China.
But all from forbidden palace and chinese equiv of gchq?
There is a work-around that a person can use, that will allow a person to see blocked websites. I haven’t looked into it–didn’t think getting into trouble on a brief stay was a good idea. But I know I received birthday greetings from Chinese people who must have received updates from Facebook.
When I traveled in China a few years ago I met mostly the elite, for example the relatively well payed and well educated workers in the tourist industry. I would guess that the majority of Chinese are still poor peasants. I wonder to what extent Gail will get to see this element.
She is meeting with university staff and students far from dirt farmers.
I think that the people at the university are doing their best to keep me away from the poor. This is a problem. But I will be meeting with a fairly high official on Monday, I understand, according to the plan. I guess a person can’t have everything.
“Chinese Premier Vows Tougher Regulation on Air Pollution”,
By Edward Wong and Chris Buckley, March 15, 2015
Sorry Gail it’s from NYT, but hopefully you can get first hand information about this “Under The Dome – Part III” (if we call part I: Broadcasting, and part II: Censorship)
I have heard about the tougher regulation on air pollution over here too. The air pollution problem is a problem in many Chinese cities–not just Beijing. The problem though is we are up against diminishing returns. We don’t have any good way of reducing air pollution without increasing costs. Increasing costs causes the economy to contract. At the same time, we end up with commodity prices too low and debt defautls. Also, other countries are tempted to compete by ignoring the pollution problem. We have an essentially unfixable problem.
“Other countries are tempted to compete by ignoring the pollution problem.” And this is exactly what we are seeing. India’s coal use is sky-rocketing as they take advantage of the price-slump:
The Guardian, Thu.19 March:
“Revealed: Gates Foundation’s $1.4bn in fossil fuel investments
Analysis of the Bill and Melinda Gates Foundation’s most recent tax filing reveals huge investments in the world’s biggest fossil fuel companies”
“Various studies have now confirmed that the land, or grounded, ice in Antarctica is losing mass. Esa’s current polar observing spacecraft, known as Cryosat, recently reported that the continent’s ice sheet was diminishing at a rate of 160 billion tonnes a year. Cryosat found the average elevation of the full ice sheet to be falling annually by almost 2cm.”
And as they say, correlation is not causation, and past performance is no guarantee of future rewards.
Thanks, Gail. Your description of real life in China is (to my mind) a literary masterpiece, and precisely the sort of thing our society needs more of.
I guess, to go into it a little more, there is a deadpan honesty and integrity to the reporting that somehow matches the absurdity of our underlying predicament. One connects those thermoses of hot water with ancient Chinese medicine and its perhaps lingering traces. She describes young people. There is a pathos to their clothes. Poor people sacrifice everything to send those kids to school. They’ve bought into a farce, but with such earnestness. All this and more coming through between the lines…
@ Artleads said: “Poor people sacrifice everything to send those kids to school. They’ve bought into a farce, but with such earnestness. All this and more coming through between the lines…”
If you missed it, you might want to take a look at this:
•••••••In ancient times in China, education was the only way out of poverty — in recent times it has been the best way. China’s economic boom and talk of the merits of hard work have created an expectation that to study is to escape poverty. But these days China’s higher education system only leads to jobs for a few, educating a new generation to unemployment and despair.
Director Weijun Chen
Producer Don Edkins
Produced by Steps International
The thing that strikes me as I talk to the graduate students is how many of them are actually from two child families. I think the central area followed the one child family policy more closely than the outlying areas. Even now I am seeing a quite a few families with very obviously two children–for example, dressed alike. I know they have loosened up on the policy, and maybe some of these children are from after the policy change, but I have been struck by how many two child families I have run across.
That doesn’t really answer your question. I expect that the wealthy men will be able to find wives (and people are at the university are likely among the wealthy). So perhaps there is less concern than there otherwise might be.
Thanks for the correction. Still, those thermoses with all their color and diversity, seem like touching hold outs from the past. I wonder where things like that will shake out (no pun intended) in the end. I suspect they’ll still be there after some massive soon-to-come collapse, and quite a chaotic aftermath.
Gail, have you encountered any discussion of the one child policy? Does anyone anticipate a shortage of marriageable females?
The story I heard is that there already is a conspicuous deficit of young females due to selection by parents. But that doesn’t stop there being dating chinese/foreigner sites. Or loads of chinky girl students over here and over sexed (judging by the way they dress at least!).
What an amazing trip. You are extremely bold. Enjoy every moment.
Your admiring cousin,
Thanks, Mark. You have done some pretty amazing things yourself!
Thanks for keeping us up to date.
As far as you can tell, how much awareness is there in China that we do, indeed, live on a finite planet, which means that Western Industrial Civilization cannot be globally replicated, except in the short term, perhaps allowing a transition from the “growth paradigm” which has dominated economics for over two centuries.
I find Putin’s Eurasian cooperation – and the new Silk Road, etc. – concept very appealing, but it all eventually runs up against depleting resources, especially oil of course. So a high speed rail link, for instance, may have a fairly short period of viability.
Anyway congratulations on your lecture series and tour.
“I find Putin’s Eurasian cooperation – and the new Silk Road, etc. – concept very appealing, but it all eventually runs up against depleting resources, especially oil of course. So a high speed rail link, for instance, may have a fairly short period of viability.”
I do as well. It just seems more of continuing BAU as the economy needs infinite growth or it all collapses.
I wonder if that fish with bones in it is carp, cooked like canned Salmon. (The bones are nutritious.)
Indeed, not eating bones is a major nutritional mistake, probably responsible for much arthritis, fractures, dental decay, wrinkles.
I suppose I should start eating the bones. Women especially are prone to calcium deficiency problems.
Wasn’t clear whether you were talking about well-cooked bones like in canned salmon, or the sort you would definitely want to weed out first. By the way, bone broth etc is the traditional alternative in past cultures.
Thanks Gail for the update.
You say: “China has chosen the inexpensive way to do things”. I’d add: …so far.
I don’t know much about China, but I guess that in order to grow up their economy, they had to increase first in quantity, before thinking of upgrading in quality.
You raise an interesting point re: quantity over quality!
Let’s not forget the population in the US is circa 315 million with a 100% child birth replacement rate (2.1 fertility rate that’s actually slowing post 2008 financial crash). China, we know their total population is circa 1.4 billion, nearly 5X as many people with a slightly similar landmass of 9.5 million km2 versus US 9.1 million respectively.
China moved from the tertiary to the secondary sector we see today, unlike the Indians who attempted to jump straight to the service sector by passing manufacturing! It does seem the Chinese are gearing up for services as the US once transitioned through the 19th/20th centuries respectively.
What is incredibly interesting, is China’s demographics. Their current fertility rate is circa 1.3 children, with their official 1 child policy and possibly families that have additional unregistered children. This statistic means some massive things down the road given the replacement rate for any population is 2.1. Essentially they’re at 50-60% replacement rate of what’s needed to maintain their population. Where will China find the 600-700 million people to replace the ones that were never born? They’re going to face towards the mid part of 2050, particularly towards the latter part of the century a demographic implosion the likes of which we haven’t seen “including” the plague. The math is obvious. When will China have ever experienced a 50% reduction in its population? Never, basically pre-writing given no such thing has ever been recorded. It’s as though someone went through and killed half of their population.
So given they’re population is going to shrink from 1.4 billion down to 700 million or less, especially given the fact that baby making is inversely correlated to education & wealth but positively correlated to religion, I wonder whether the remaining Chinese people’s “quality” of lives will improve (from a resource perspective) given such massive decreases are on the horizon in terms of the “quantity” of people. Remember that as you become more educated, wealthier you don’t have as many kids. The poor, uneducated, religious on the other hand, do so!
Interesting stuff, welcome feedback on this because it’s something that’s got me thinking.
We hear that China is the rising superpower, we know they’re facing a demographic implosion in the future. We know they’re educated, getting wealthier. So will their quality of life improve given less resources will be needed to maintain an imploding population? What the heck effects what, when, how and why etc!
I just googled “chinese demographic implosion” and got dozens of links to all sorts of articles. One example:
“China’s Population Poised to Crash in a Perfect Demographic Storm”
Note that OECD countries also have similar problem, with a big questionmark about tax-funded pension programs and healthcare of the elderly. See e.g.:
However, given that we’re headed to major resource problems in a much shorter timeframe, wether you’re old or young likely won’t matter for same reasons, as nobody will care about paying taxes, for example.
IMHO, resource scarcity is a much more powerful factor than population dynamics. See e.g. Yemen whose population is likely to crash despite being very young in average.
A good question is how the population will ever take care of all of the elderly. There can’t possibly be enough jobs for everyone, even if they did want to work much longer. They have the expecation that they will have all the things they think the Western developed countries have, like pensions for the elderly and healthcare for all. Of course, the Western countries can’t really pay for all of these things either.
I think that it was Gail that “sustainability *is* the way of the future”, meaning that
it’s not a matter of whether we want or accept it, but that it will be imposed on us by nature.
I see population as being exactly the same, with an additional kick from declining farming productivity through a variety of mechanisms; weather, water and fertiliser etc. The controlled demographic implosion may be ugly, but it’s a lot better than an uncontrolled one where the driving factors will be disease and famine.
1. Retirement ages are going to rise
2. Nursing/Care homes are going to be in incredibly high demand then! In the same way we put kids in school, so parents can work, the elderly are going in homes. Government will raise taxes to pay for them I bet. I also think in China nursing/care homes will be a relatively new concept.
I’d add that a young population is needed to fight wars. Hence my skepticism when I read MSM articles characterising China in that light.
A few observations to fill in some blanks:
Imagine the United States with 1 Billion people lived east of the Mississippi, and a hundred million west of it. That’s sort of what you have in China, but worse: Tibet, Xinjiang, Inner Mongolia, Gansu and Qinghai account for about half of China’s landmass, and have climates similar to Arizona and Utah:hot, high, frigid, and arid. The southern tier of provinces: Guangdong, Guangxi, Kweizhou and Yunnan are mostly mountainous, well watered and fertile. But it’s in the east that most people live.
The Chinese have a love-hate problem with the USA. They admire and need the Americans — for everything from educating their elites’ children to providing security in the region and the world that the elite can exploit (by getting their money families and real estate safely ensconced. Their only problem is that they seriously resent the disrespectful treatment they inevitably receive, especially now with wealth. Even the Party is unsure whether their Leninist political system will survive, and Marxism is already pretty dead, so the fascist capitalism they now enjoy may last for decades, or merely a few months. Nobody knows for sure, and that’s why the wealthy are setting up safehavens in all the usual attractive locations.
Will the Chinese be tempted to war over Taiwan or other things (eg, oil in the offshore areas east and south of China)? Tempted perhaps, but probably not enough to actually get dangerous.
Will the ‘Chinese economic miracle’ continue? Probably not, as they are now caught in the ‘middle income trap’ where their labor costs have risen but their productivity per person is still relatively low. Which means the ‘low wage – high volume of people and production’ will not work well in China anymore, but will still apply to Southeast Asia where wages and real estate are still cheap. China’s per capita GDP is nominally in the $4,000 range, for the entire country, and that number gets confused because the daily newspapers portray China’s income per capita as Purchasing Power Parity, which is pretty well doubles the basic number, because the actual prices for a bag of rice in the countryside is a heckuvalot cheaper than it is in Richmond.. Life in China’ medium size and large cities is expensive, while surviving in the countryside is much cheaper, as is true everywhere.
China may never become the “Premium Economy in the World” in real or nominal calculations, and it doesn’t matter. What is important is that the Chinese are confident, capable, proud of their accomplishments, secure in their existence and optimistic about their future. Kinda like us, perhaps.
China rose to economic power by becoming the world’s low cost mfg. Now there are other nations who are going after China’s business and want to be an even lower cost mfg. China plans to become more consumer driven much like the USA. The problem in a global economy is that if you lose jobs eventually the wealth in your country moves out and the population become poorer like what’s happened to the US.
China’s problem is that it has over 1.2 billion mouths to feed.
@ Chris Johnson says: “Nobody knows for sure, and that’s why the wealthy are setting up safehavens in all the usual attractive locations.”
Al Jazeera did a documentary on Singapore a while back, Singapore being one of the “usual attractive locations.”
But isn’t part of Gail’s argument that these “safehavens” might not be so safe?
When the existing world order, which is predicated on a paradigm which requires endless economic and population growth, comes crashing down, all bets are off.
Singapore will have to bring its food in by boat as it does today. First problem a supplier, second problem Singapore does not have a navy and if first go bad no one else’s navy will come to the rescue. You can;t eat gold.
Gail said: “China has chosen the inexpensive way to do things, such as serving fish with lots of bones, not doing much to accommodate the handicapped, and using radiator heat put in buildings long ago.”
That strikes me odd as China has no problems building ghost cities and factories to keep their people busy and working and make their GDP look better. But seem to go the cheap route for other parts of their economy where it can improve the lives of their people and put their money to better use rather than on ghost cities and factories that are being neglected and decaying from lack of use and maintenance.
In our major uk city here there is a desperate crisis of shortage of money for all manner of things and yet “strangely” there’s simultaneously no shortage of money for numerous huge grand transport and redevelopment schemes which no-one has asked for. It’s basically big corporations corrupting the allocation of resources so it all gets sucked into themselves.
One man’s corruption is another man’s year end bonus. The government serves the ultra wealthy not the common people.
I am in a hotel in Ordos, Inner Mongolia for a couple of nights. Here, the room comes with a computer and wired in Internet, so I can get to Our Finite World comment.
The thing that strikes me is that there must be a huge amount of debt underlying all of the building that has been going on, and still is going on. I cannot figure out otherwise where all the wealth comes from.
Wealth comes from the value of future expenditure discounted to the present (but you knew that already 😉
You comments on the University brought to mind a lecture by a building services engineer. It was midwinter, and held in a multistorey 1970’s building in the UK, complete with cast iron radiators and a rudimentary form of double glazing. The lecture began with all the windows closed, and as the lecture progressed, the Engineer checked a handheld CO2 meter. When the CO2 levels got too high and inmates started dozing off, the windows were opened. I’m not sure if it was the oxygen or the icy blast from the window beside me that kept me awake.
Wow, sounds like quite the adventure! Hope you are keeping a travel log on attitudes too and what some of the petroleum people there think about the emissions cuts China has committed too. Also how your ideas are received?
Gail, Your timing is excellent. China’s 25 year boom has pretty much ended, and they are now trying to figure out what their priorities should be and how to organize and achieve the goals that will inevitably be established. They’ve obviously journeyed well beyond the outer limits of the Marxian playbook; the complex economic, social and political intermeshings pose enormous omnidimensional problems.
A few thoughts: ‘tea’ in Communist China became a two-character word ”Cha Shwei” – tea water, in the egalitarianist (poor) Maoist era. Cha schwei is hot water with a few tea leaves that barely darken the water. ‘Shwei’ or ‘Kai Shwei’ — boiled water — became commonplace to demonstrate a person’s proletarian inclinations, especially during the Cultural Revolution. They were not tempted by such delicacies as tea leaves… The only problem with such strictures is when Deng Xiaoping proclaimed that “To get rich is glorious” all of that mndset had to either be cast out or ignored. This is just a small example — one of several thousands of daily contradictions that the Chinese have to deal with in every aspect of their life. Nothing is easy there. And yes, I do speak the language, used to work with them, keep tabs with other ‘Old China Hands’ and may well end up retiring there, as the tea and can be wonderful and the never ending chess games (including elephants…) become a way of life.
Have a great trip.
The cold water hot water bottled water situation appears to be much the same as found in Russia, where the “samovar” constantly on the boil has long been a feature of the culture due to unboiled water being a choleraic death sentence.
Thanks for the interesting report!
A small correction: there may be many American brands of clothing, but Adidas is not one of them.