Overview of Our Energy Modeling Problem

We live in a world with limits, yet our economy needs growth. How can we expect this scenario to play out? My view is that this problem will play out as a fairly near-term financial problem, with low oil prices leading to a fall in oil production. But not everyone comes to this conclusion. What were the views of early researchers? How do my views differ?

In my post today, I plan to discuss the first lecture I gave to a group of college students in Beijing. A PDF of it can be found here: 1. Overview of Energy Modeling Problem. A MP4 video is available as well on my Presentations/Podcasts Page.

Many Limits in a Finite World

We live in a world with limits. These limits are not just energy limits; they come in many different forms:

2 We are reaching limits in many ways

All these limits work together. We can work around these limits, but the workarounds are higher cost–for example, substituting less polluting energy resources for more polluting energy resources, or extracting lower grade ores instead of high-grade ores. When lower grade ores are used, we need to process more waste material, raising costs because of greater energy use. When population rises, we must change our agricultural approaches to increase food production per acre cultivated.

The problem we reach with any of these workarounds is diminishing returns. We can keep increasing output, but doing so requires disproportionately more inputs of many kinds (including human labor, mineral resources, fresh water, and energy products) to produce the same quantity of output. This creates higher costs, and can lead to financial problems. This phenomenon is one of the major things that a model of a finite world should reflect.

Economists Views

Economists developed their views of the economy long ago, when limits seemed to be far in the distance. Thus, the models they built do not reflect the expected impact of limits. They are missing variables that would be needed to adjust for changes in the economy’s behavior as limits are reached.

3 Economists put together models

4 Economy will adapt

The story in Slides 3 and 4 tends to be true if we are far from limits, but is it really true when we are close to limits? Perhaps diminishing returns as we approach limits changes the results.

5 What is the real story

World Oil Situation as We Approach Limits

Perhaps we can get some indication of how diminishing returns are affecting the economy by looking at historical oil supply and prices. Up until 1970, US oil production grew quite steadily.

6 US oil production

After 1970, oil production suddenly began to decline. Oil companies did not expect such a decline; they assumed that oil production would rise endlessly. Once oil production began to decline, oil companies quickly began trying to find ways to fix their problems. One of these approaches was quickly to ramp up production in areas that they knew contained oil, but hadn’t previously been drilled. These included Alaska (northern United States), Mexico, and the North Sea. Oil production in these areas is now in decline.

Several ways were also found to reduce oil usage. These included change from oil to alternate fuels for electricity generation and home heating, and offering smaller, more fuel-efficient cars. With this combination of approaches, oil prices were brought down, most of the way to the $20 level (Slide 7).

The inflation adjusted level of oil prices is important because oil is the single largest source of energy use in both the US and world economy. If oil prices are cheap, it easy to grow food cheaply, and manufacturing and transport can be done cheaply. Because of this, the economy tends to grow. If oil prices rise, economic growth tends to slow, because the cost of many types of goods (including oil products, food, and building new homes) tends to rise faster than wages. It becomes more expensive to replace infrastructure such as roads and pipelines as well. The higher cost of oil effectively acts as a “tax” inhibiting economic growth.

7 World oil supply

Oil prices again reached a high level in the early 200os as we again began to reach limits of the amount of oil that could be extracted at the then-available price. This time we weren’t able to cut back on world demand, so prices tended to stay high. Instead, the big change made was in oil supply, with higher oil prices enabling (after a several years time-lag) greater production both from US oil from shale formations (called “tight oil” in Slide 6 above) and from the oil sands in Canada.

The question becomes: can the economy really function adequately on $100+ barrel oil? Or do the negative feedbacks from these high oil prices have too adverse an impact on economic growth?

8 Now oil price is too low

Slide 8 shows more detail regarding production and prices for recent years. We see that oil prices were generally rising up until mid 2008, and then dropped steeply. Prices rose again after several types of economic stimulus were added. More government spending was added, interest rates were dropped to very low levels and a program called quantitative easing (QE) began.

Prices stayed at a level a little over $100 barrel from January 2011 though mid-2014. More recently, oil prices have dropped to a little more than half of their previous level. This decline in oil prices appears to correspond to a time when world debt is not rising as rapidly: the US stopped its QE program, and China’s debt no longer rising as rapidly. Thus, some of the economic stimulus that helped hold oil prices up is disappearing.

The problem we are now encountering is not the high price problem that economists thought would bring on more supply. Instead, we are encountering a problem with oil prices that are too low for oil producers to make a profit. Such low oil prices can quite possibly bring down world oil production, because investment in oil production is no longer profitable. A person might ask: Is the low price situation we saw in 2008 and are encountering again in 2014-2015 what diminishing returns really looks like? Is the problem we encounter as we reach limits one in which oil prices drop too low, rather than rise too high?

In 2008, huge stimulus efforts were required to bring oil prices were brought back up to the $100+ level. Perhaps one point raised by economists (Slide 3) was correct: Maybe there is a connection between economic growth and oil demand. Perhaps the issue as we reach limits is that world economic growth sinks too low, and it is because of this slow growth that wages stagnate, debt stops rising quickly, and oil (and other commodity) prices drop too low.

Now let’s look at what some early energy researchers have said.

M. King Hubbert 

Many believers in Peak Oil theory consider M. King Hubbert to be the originator of their theory. It seems to me, though, that Peak Oilers have inadvertently picked up some of the economists’ theories, and mixed them with Hubbert’s theories.

9. M. King Hubbert

10 M. King Hubbert Model

11 Model applies when there is perfect replacemnt12 Hubbert understood need for perfect replacment

13 Believers in peak oil

It seems to me that the only way a Hubbert Curve might happen is if oil prices stay high, as we approach limits. That way, as much oil as possible can be extracted. If oil prices fall too low, then the decline may be much quicker. If low oil prices are a problem, above ground problems such as governments of oil exporting nations collapsing, or rising debt defaults leading to bank failures, may be a problem.

Dennis Meadows and Donella Meadows

Dennis Meadows led early computer modeling efforts at MIT regarding limits of a finite world. His wife, Donella Meadows, led the write-up effort regarding this model in a 1972 book called “Limits to Growth”. The model looked at physical quantities of resources, expected amounts of pollution, and expected population trends. The base model suggested that the world would start reaching limits in roughly the current timeframe.

16 Meadows Limits to Growth

In fact, more recent analyses suggest that the base model is more or less on track.

I don’t think that we can count directly on this analysis, however.

18 How will the situation work out

Charles Hall

Prof. Charles Hall has been one of the recent thought-leaders with respect to oil limits and how they might play out. He started work in the early 1970s as an ecologist, studying the energy patterns of fish. When he read about the possibility of energy shortages that might occur in the 1972 book Limits to Growth, he tried to adapt an approach used for studying energy patterns of fish to the world of energy production. The result was new way of measuring the efficiency of a particular energy product, called Energy Return on Energy Invested (EROEI).

20 Energy Return on Energy Invested

This idea was an advance when it was first developed, but it has a number of practical difficulties. One of these difficulties is that its usefulness is tied to a particular view of how oil limits will affect us, namely that prices will rise, and this will allow a slow transition to alternative fuels that are less favorable in terms of EROEI. On Slide 21, this is Item (2).

21 Two different modelsAt this point, it is my view that the EROEI approach to analyzing energy products can be misleading and needs updating. Energy extraction is much more complicated than the energy use of fish swimming upstream. The EROEI approach, besides being tied to the Peak Oil view of how limits will occur, is difficult to calculate. Different researchers get quite different answers, when analyzing the same energy product.

Furthermore, EROEI looks at a piece of energy costs (those involved with production at the well head), but how this piece relates to the total varies from one type of energy to another. It lumps together cheap energy and expensive energy. There are several other issues as well, with the result being that in practice, low EROEI doesn’t necessarily correspond to expensive to produce, and high EROEI doesn’t necessarily correspond to low cost to produce.

I should point out that the same problem exists with a wide range of similar metrics including Life Cycle Analysis, Energy Payback Period, and Net Energy. In practice, what seems to happen is that if an energy type is high-priced, the use of one of these metrics is used to justify its production, anyhow. Low EROEI (for example, of biofuels) does not seem to be a barrier to production, even though it was the hope of Prof. Hall and other EROEI researchers that this would be the case.

My Involvement in Energy Analysis

25 What exactly is the story

26 Correctly forecast 2008 collapse

I became acquainted with Prof. Lianyong Feng in 2009, when he attended the Biophysical Economics Conference in Syracuse, New York, held by Prof. Charles Hall, and heard me speak.

27 Photo of Gail Tverberg, Charles Hall, Prof. Feng

How Do Oil Limits Really Affect the Economy?

This is the question I have been working on. I will try to explain some of my findings in the next several sessions.

Early researchers were handicapped because the issue of oil limits crosses many different fields of research. They took approaches from their own areas of study, and worked with them. These approaches offered partial insight into the problem, but didn’t completely answer what might happen in the future.

It was not obvious to early researchers which parts of economists’ theories were wrong. I have had the benefit of seeing how the system works in practice in several periods: in 1973-1974, in 2008-2009, and now in 2014-2015. I have also been fortunate enough to find a number of recent studies that add new insights as to how the system really works. So I have taken a step back and developed at the least the start of a new theory, which is different from EROEI theory. This is what I will discuss in the next few sessions.

A little explanation behind this series of lectures and my four week stay in China is perhaps in order. When I was in China, Prof. Feng discussed with me some of his intent behind asking me to give this series of lectures. Prof. Hall is now retired, and there is no obvious replacement for him. Prof. Feng would like me to take a more active role is figuring out in which direction energy research should now be headed, both for his own staff, and for others around the world. A better understanding of how the system works could theoretically help researchers everywhere.

About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to financial problems for oil producers and for oil exporting countries. We are really dealing with a physics problem that affects many parts of the economy at once, including wages and the financial system. I try to look at the overall problem.
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589 Responses to Overview of Our Energy Modeling Problem

  1. Is there maintenance gong on? The entire article “Gail in China: In Her Own Words and Pictures” with all its comments seems to have suddenly vanished.

    • Sorry. I was having problems with the date of my new article being wrong–too early. That made it show up down on the chain of articles, instead of “on top”.

      The only way I could temporarily fix the situation was to make the China article “private” temporarily, until I could fix the date on my new article. I have since fixed the date (with the help of WordPress). The China article should now back. I am wondering if people will have problems with links to my new article not working, though, because I changed the date shown in the header to the correct date.

  2. Don Stewart says:

    Dear Gail and Finite Worlders

    I listened to a talk by Fritjof Capra last evening. Message: everything is a complex adaptive system. (Long but listen if you are interested.)


    This morning, a couple of short vignettes crossed my screen which illustrate the point about life being a complex system:


    What happens when you eat a cupcake or your kid drinks a glass of chocolate milk? When the few teaspoons of sugar land on the tongue, they trigger sugar receptors in the taste buds to send a message to the brain that yells: “MORE!” That’s because the sugar receptors tell your body you’ve eaten something sweet, which activates the reward centers of the brain and produces dopamine, the brain chemical of pleasure and satisfaction. Most of life is about managing dopamine—how to make more of it and how to not become a slave to it.

    When dopamine is released, you feel happy and any tension is temporarily eased. That’s why so many women eat sugar to change their emotional state. The problem, of course, is that the benefit is short-lived, and the pattern can become addictive. Feeling happy in response to sugar makes you want more sugar so you can keep feeling good. As the sugar moves through your gastrointestinal system, the way it holds your brain hostage continues: sugar receptors in the stomach and intestines send more feel-good signals to the brain.


    Why the Body Matters When Working with Brain Science
    Why You Can’t Just Use the Left Brain to Talk Your Way Out of Trauma

    Back to me. My point is that just talking about Peak Everything is not good enough. We have to be doing things. And we have to understand, both in our brains and in our bodies, how the whole system works. For example, ask yourself ‘what is the sugar for the corporation?’. And the answer I come up with is ‘money’. If you ask ‘what is the sugar for the Mother?’, then the answer comes up ‘a growing, thriving, child’. Therein lies the distinction which makes a difference.

    Don Stewart

  3. Fast Eddy says:

    Praise the lord, praise the lord – hallelujah – we are saved http://www.forbes.com/sites/joelmoser/2015/05/05/when-oil-wont-rebound/

    We must welcome such ‘journalism’ because it will ensure that the sheeple remain calm as they are herded into the pens of death post-collapse.

  4. Don Stewart says:

    Dear Gail and Finite Worlders

    A few resources to use to triangulate on the question of what you intend to do after the collapse…or before the collapse just for practice…or regardless of whether we have a collapse or not just because it is a good idea.

    First up is Samuel Alexander on The Small House. This takes off on Thoreau and many others. We have even had a ‘small house’ symposium in Chapel Hill…although I think the county still won’t give you an occupancy permit. My county was the temporary home of William Powers, who lived in a Twelve By Twelve, later lived in a tiny place with his wife in Manhattan, and has now moved to Bolivia.

    Charles Hugh Smith works the numbers and finds that only about 3 percent of those who have a job are actually independent:


    When Charles uses the word ‘independent’, he neglects the fact that if you are, say, a carpenter, you must be able to attract customers. An independent carpenter is a lot more free than a cubicle rat, but ‘independence’ is the wrong word to use.

    The Japanese movie Woman In The Dunes (which I have previously recommended) gives us a harrowing scene. The man has asked to be able to visit the sea once a day. He promises that he will not attempt to escape…but he has been constantly trying to escape in the recent past. The villagers show up in costume and tell him that they will let him visit the sea, provided he and his ‘wife’ put on a public sex show for them. The man is torn, but eventually goes into the hut and drags his wife out. They struggle, both fall exhausted, and the villagers leave. This is, I think, a Biblical-like parable about selling your soul for a mess of pottage.

    In the movies finale, the man has the means to leave, but chooses to stay. A life of work and purpose has trumped the life of mindless consumption in Tokyo…with three days off to look for bugs. Is the man independent? No, the woman told him early on that a single person cannot survive in the dunes. But neither is he a slave to corporations and mindless consumption and debt.

    Finally, I recommend the final chapters of Harari’s book Sapiens: A Brief History of Humankind. Harari makes the point that modern psychology shows that history is basically irrelevant to human happiness….there is no reason to believe that 21st century Americans are any happier than medieval peasants. Harari cites evidence that a life of purpose is more important to most people than a life of comfort and distraction….with the prime evidence being motherhood. But Harari also explores the possibility that we may be on the verge of creating a new life form which will no longer be a homo sapiens. So Harari is not an ideologue like Thoreau, but he is likely to cast grave doubts in your mind about the importance of having a McMansion.

    Don Stewart

  5. Pingback: News update | Peak Oil India | Exploring the coming energy crisis and the way forward

  6. Brandon says:

    Hi Gail! You might have covered this before but the food issue is not a production problem its a distribution problem. If food was grown locally there would be less waste and less carbon footprint from transportation. In many places however its against the law to grow food on your front lawn isn’t that sad!? I love your blog.

  7. B9K9 says:

    TSG “I seek to understand how this (cognitive dissonance) works.”

    Why do you care how it works? Why not just start with the natural advantage knowing that it DOES exist? Once you recognize that you are amongst a few elite individuals who share this unique insight about the human condition, then you can proceed to exploit it to your own advantage.

    Join the long list of religious leaders, bankers/financiers, war profiteers, military adventurists, political ‘leaders’, et al who live very comfortable lives ripping off the gullible, stupid, and dumb. The only marginal area of concern are those smart enough to question some very basic facts, but thankfully, there’s also an educational elite along with various media outlets to make sure those curious sheep don’t stray too far afield.

    It’s a very rarefied atmosphere to not only see what’s going down, but to eliminate any concern for those who can’t buy a clue. Leave them to the sharks while you sip a pina colada.

  8. Tolstoy's Degenerate Grandson says:

    Peak Oil is Here and Now.

    Peak Russia + Peak USA Means Peak World http://seekingalpha.com/article/3133426-peak-russia-peak-usa-means-peak-world

  9. Don Stewart says:

    Dear Gail and Finite Worlders
    We frequently have discussions about the possibilities of a collapse. Here are some thoughts from Adam Taggart (from Chris Martenson’s blog) and Charles Hugh Smith. These quotes are from Smith’s note to his subscribers. I generally don’t like to quote extensively from these notes, because Smith makes a part of his living writing things like this. I excuse myself this time because this will doubtless eventually show up on Martenson’s blog.

    The question posed by Taggart was ‘what sort of Black Swan could bring down the system?’ The first conclusion is that if the Central Banks can print a trillion dollars and force it into the system by purchasing financial assets, and solve the problem in at least the short term, then it won’t bring down the system. For example, the student loan problem will probably be resolved by the Federal Reserve purchasing the loans with money they have printed. The system continues to work.

    Then they identify things that the Federal Reserve cannot resolve in the short term by printing money and purchasing financial assets. Here is their list….Don Stewart

    Any future black swan must not be solvable by printing money and buying assets.

    Adam and I boiled down the list of problems that cannot be solved by creating money and buying assets to two classes of problems:
    1. real-world resources
    2. social/financial inequality

    Declining oil production (as a result of geopolitical turmoil, Land Model reduction of exports, marginal producers shutting down production, bankruptcies shelving development and expansion plans, etc.) is currently being matched by softening global demand as the global economy weakens.

    But eventually these declines in production will set up a massive price spike as supply falls well below demand. Once existing stocks of cheap oil are consumed, production must rise quickjly to meet demand. But raising production globally is not like turning on a light switch–it takes years and tens of billions of dollars to increase oil production on a global scale.

    Should oil drop to $30/barrel as many expect (most analysts see the rise from $43 to $59/barrel as driven by speculation rather than fundamentals), a secular decline in production will trigger a sharp rise back to the level needed to support marginal production, i.e. $90-$100/barrel.

    Central banks can print another $1 trillion, but this won’t magically increase production of oil. Price spikes in energy reliably cause recessions, and since interest rates are already near-zero and every asset class is already in a bubble, central banks will be powerless to solve a recession by printing money and buying more assets.

    Adam posited that the social pressures generated by rising wealth inequality–the direct consequence of central-bank money-printing and asset-purchase policies–are another potential black swan that the Fed and other central banks cannot resolve by printing more money and using it to buy more assets.

    As Adam mentioned, the Fed could resolve rising inequality by following Steve Keen’s plan for reducing household debt: send every household $50,000, which would have to be applied first to debt. Those households with no debt would be free to spend the $50K at their discretion.

    But central banks have no mechanisms in place to create trillions of dollars and distribute the money directly to households. Central banks exist to insure private banks have the means to continue reaping outsized profits from speculation and lending money. It would take a massive political shift for central banks to be politically empowered to “gift” households with newly issued money. It would take a crisis of immense proportions to trigger such a radical political and financial shift.

    Another candidate for a black swan that is beyond the control of central banks is a crisis in a major currency. This has the potential to disrupt the global financial system because printing $1 trillion isn’t enough to move the global currency markets if the herd is running. It could take $5 trillion or more–larger than the entire Fed balance sheet of $4.5 trillion–to control the global foreign exchange markets. And money creation on that scale might well generate fierce political resistance and unintended consequences.

    The last possibility Adam suggested is systemic complexity: the more complex the system, the greater the uncertainties and thus the risks of apparently minor events that “appear out of nowhere” triggering disruptions that quickly spread to the entire financial system.

    Right now the system is being stabilized by two very simple mechanisms: zero interest rates and central banks buying assets in astounding quantities. These brute-force methods have worked for six years, but the complexity of the global financial system opens the possibility that something somewhere will not be controllable by these simple brute-force tools.

    • Tolstoy's Degenerate Grandson says:

      How about this:

      The middle class in western countries continues to reduce spending resulting in corporate profits plunging (even though share prices remain at record highs due to buy backs).

      Corporations start to lay people off which collapses profits even further as laid off people stop spending.

      This leads to the mother of all deflationary death spirals…

      • Daddio7 says:

        The spiral starts when the better off start conserving. They don’t need all the services they get so their comfort level stays the same. Their servers on the other hand now have less to spend. People need a certain amount of food and supplies to continue. People can become more self sufficient but they need land and temporary housing. The government can pry money out of the hands of people who have extra (yes communism) or print up some until inflation gets to bad. We have a large segment of people who think they should be taken care off or at least given jobs near where they live. Most of the farm land is not where most of the people are. Promises of food, forty acres and a mule may get some moving. It ought to make a very entertaining movie.

      • Don Stewart says:

        Dear TDG
        I can’t speak for Taggart and Smith, not having been part of their conversation. However, your scenario of continued decreases in spending by the middle class seems to me to be a function of the workings of BW Hill’s model.

        To wit: the supply of work available from oil (and perhaps gas and possibly even coal) is shrinking as more of the work inherent in a unit of fossil fuels is required to produce the fossil fuel. When the work capacity declines, then production declines. As production declines, corporate revenues decline, wages paid declines, and so forth. Also at work, particularly in the West, is the fact that more of the work which is available has to be spent on maintenance of the existing infrastructure (Greer’s Catabolic Collapse). We are approaching, using Hill’s numbers just for example, the point where fossil fuels are not generating any growth effect at all. (Or maybe we have passed that point). The central question is whether we have any way to get enough energy to produce the work required for growth. The answers to the question are obscured by our focus on ‘barrels of oil’ rather than ‘work performed’, and ‘jobs’ rather than the ‘creation of new value’. Can we all take in each other’s washing and claim full employment and growth?

        A central question becomes, ‘Can the Central Banks print money and buy assets to keep the fossil fuel industries going for a decade or more, after they no longer make economic sense?’ And, ‘Can the centralized media continue to convince the investors that ‘everything is fabulous’?’ I think we are seeing a coordinated effort by the CBs and the governments and the corporations to do all that. We will also see military adventures doing the usual smash and grab in terms of getting control of the remaining fossil fuels. We are seeing the rapid socialization of asset ownership, as governments replace private capital as the source of funds for the corporations. How long can they keep it going?

        I’m not sure, but I think they are doing a pretty good job of keeping the truth from leaking through to public consciousness.

        Don Stewart

        • Don Stewart says:

          Dear TDG and Others
          Besides BW Hill’s model predicting the end of useful work from oil, and besides Gail’s many writings on the subject, I have just discovered Richard Heinberg’s essay from about a year ago:


          ‘The gross society’ is one that looks only at gross production, and not at the net. He lays out in words pretty well what Hill reduces to quite precise numbers. Much of the logic is the same.

          Don Stewart

          • Stefeun says:

            Herman E.Daly made a nice little diagram about “Uneconomic Growth” in a Sept.2005 article for Scientific American, see box titled “When Growth is Bad” on the 5th page (#103):

            The Sci-Am article was linked in this one:
            Uneconomic growth deepens depression
            by Herman Daly, originally published by The Daly News | MAR 5, 2012

            which itself was linked in Richard Heinberg’s essay “The Gross Society” you mentioned.
            I must say I found both Daly’s and Heinberg’s analysis very good and insightful, but I can’t help being disappointed when it comes to the “solutions” chapter. Maybe I’m wrong, but they seem to think that “less” would be sufficient, omitting that 1. degrowth is not an option, and 2. the decrease should be of -at least- one order of magnitude (which in my view is a little bit more than “less”). Maybe such rosy final note was required by the editors.

            Btw, I note that their proposal to cap/limit the energy input or economic throughput (e.g. “Quite simply, we must learn to be successfully and happily poorer.”) resembles very much Ivan Illitch’s thesis in Energy and Equity (1973, rev.1978) (https://www.uvm.edu/~asnider/Ivan_Illich/Ivan%20Illich_Energy%20and%20Equity.pdf)
            In theory it could (have) work(ed), but unfortunately it’s impossible to implement on a global scale, because of the Maximum Power Principle.

            • Don Stewart says:

              Dear Stefeun and Others
              First, I do agree that the German plan to make fuel for their war machine from coal was not insane. In theory, it could have worked, IF they had succeeded in capturing the oil fields in the Caucusus. But they failed in the military venture, which doomed them to spending inefficiently to get the oil.

              This is the same argument that I have used in terms of agriculture. An agricultural tool which greatly increases the harvest from photosynthesis need not be made ‘sustainably’. IF 90 percent of one’s economy is photosynthesis based, then an occasional blacksmith may be a good idea. BUT, if half of one’s economy is based on fossil fuels (as in the US), then the fossil fuels really need to be used very efficiently.

              Second, as to whether it is possible to collapse and still live a good life. Last evening I saw a movie I was not previously aware of. It is Japanese, titled Woman In The Dunes. It is available in the Criterion Collection section of Hulu Plus. A middle class male school teacher is out in the sand dunes collecting bugs. He hopes to achieve some distinction by making discoveries about bugs, getting his name printed in a field guide. He falls asleep, and is awakened by some villagers just at sunset. They offer to find lodging for him in their ‘poor village’. They lower him down into a pit where sits a house and a young widow.

              Things are pretty awful in the house, by the teacher’s standards. The woman seems cheerful enough, and goes about her work of shoveling the drifting sand away from her house, using carefully rationed water and firewood, etc. After a day or so, the man figures out that he is a captive. The woman states simply that it takes a family to survive in the dunes, and the villagers have found her a husband.

              I won’t give away too much of the plot. But as the man struggles to get back to Tokyo, the woman asks him ‘did you leave a wife behind?’ and ‘why do you want so desperately to get back to Tokyo?’. The man behaves badly toward the woman, which doesn’t prevent her pregnancy. Eventually, the woman has a complication in the pregnancy which causes the villagers to set up a rescue operation and allows the man to climb a ladder out of the pit. He looks briefly at the ocean, then goes back down into the pit to work on a water harvesting system that he has invented. His new goal is not escape but to improve the conditions for the villages using very simple mechanisms. The movie ends as the Bureau of Missing Persons closes his file and declares him dead.

              I think the movie has captured pretty well the dynamics of the End of the Age of Oil and the End of the Age of Consumerism, and the End of the Age of Bureacracy and the Reinvention of the Family and so forth. The tension between the desire to return to relative comfort and the surprising joy of dealing with the practical matters of existence is handled subtly and well.

              I think all Doomers should watch the film, as well as a broader section of Finite Worlders.

              Don Stewart

    • richard says:

      In my view, the authors are somewhat careless in their choice of words:
      The problem is debt. Increased debt makes the system less stable. That makes the effect, if not the number of black swans, greater. It seems likely that many student loans will be written off. That should improve stability, so the sooner the better.
      Creating money “pay to the bearer on demand” creates debt. There are two sorts of debt – the good kind is debt that can be extinguished (repaid.) The bad kind makes the system less stable. That is what underlies the two classes of problems.
      Excess debt depresses economic activity, a shortage of oil does not help, but at present that is more of a symptom, and in time will become the problem. For now “price spikes in energy cause recessions”. “Inflation is always and everywhere a monetary phenomenon” – Milton Friedman.
      Keen’s solution of direct payment to households is only a partial fix – a sticking plaster on a torn artery – is a gift of Government, and something Central Banks are legally prevented from implementing. The question is – Do we really want to wait until the world is on the edge of the precipice before acting?
      Complexity and complex describe different things. Replace “complex” with interconnected and “appear out of nowhere” with “emerge” and “disruptions” with catastrophes” to get the real meaning.
      Finally replace “stabilised” with “destabilised” and understand that equilibrium is not stability. A system that has the words of a central banker ( ‘I know you think you understand what you thought I said but I’m not sure you realize that what you heard is not what I meant’ – Alan Greenspan) as a stabilising feeback mechanism seems to me to be close to instability.

      • Don Stewart says:

        Since I have already copied too much from Charles Smith, I guess I might as well give you the initial part of the post:

        Adam Taggart of PeakProsperity.com recently posed a question to me that ended up fueling an hour-long conversation: what event or dynamic could become the black swan that disrupts our central-bank dominated financial system?

        It’s relatively easy to imagine a number of potential black swans, but as the past six years have shown, the central banks have effectively defused a great many potential disruptions simply by creating money and buying assets in unprecedented quantities.

        My starting point is this: any problem that can be solved by creating $1 trillion out of thin air and using that new money to buy assets cannot disrupt the system.

        Mortgage sector going south? Solution: Create $1 trillion and use that to buy $1 trillion of troubled mortgages, effectively burying the debt in the balance sheet of the Federal Reserve. (All central banks play this same basic trick to solve any problem that arises in their economy: print money and use it to buy assets.)

        Government needs to borrow a lot more money, but there aren’t enough private investors willing to buy sovereign bonds paying almost no yield? Solution: print $1 trillion and buy up all the sovereign bonds being issued by the government. (This is called monetizing debt.)

        Stock market looking shaky? Solution: Create $1 trillion and use that to buy $1 trillion of stock indices.

        Local government bonds about to default? Solution: Create $1 trillion and use the money to buy up the iffy local-government bonds.

        We can anticipate this will be the ultimate solution to student loan debt defaults: the Fed will print another $1 trillion and use it to buy up all the student loan debt. Once this debt is buried in the Fed balance sheet, it will be forgotten.

        So if a problem can be solved by printing another $1 trillion and using it to buy assets (i.e. safely bury the troublesome debt in the central bank balance sheet), then the problem cannot destabilize the financial system.

        Back to me. I think that the question is ‘if the Central Banks are guaranteeing debts and are committed to perpetually rising equity markets and perpetual declining interest rates (even including negative interest rates), and if Central Banks are willing to loan money and buy stocks in particular companies that are distressed, and if everyone believes that they will do so, is there any financial bobble that can be considered as a Black Swan? In the near term? In the longer term?

        If you look at what the BOJ has done, it is amazing to me that Japan is still standing. I heard one guy ask ‘why are there still any yen in Japan?’ If the US and Europe follow the Japanese example, and are able to reach the heights of financial folly that the BOJ has reached, it will take some additional decades of money printing. I never thought it would work for as long as it has.

        Don Stewart

        • Tolstoy's Degenerate Grandson says:

          Don – this strategy of ‘nothing fails no matter’ what has worked so far.

          But of recent we are seeing that the even with all this stimulus, companies earnings are trending lower. The stock market can be ramped up with buy-backs but if companies are not growing their bottom lines then that will eventually lead to layoffs.

          And when that dynamic grabs the economy by the throat, I do not think anything can be done about it. This will result in unrelenting and immense deflationary pressures.

          And no amount of money printing can loosen the noose.

          I reckon this is like a strong man holding up an apple. He can do it for quite some time and defy gravity – but eventually the apple will fall.

    • These brute force methods are sort of working, but in the end, they are not working well enough. I think that is why oil and other commodity prices are so low, and wages of common workers are so low. No matter how much money is printed, in the short run, it doesn’t increase the amount of resources available to be purchased. If some get more, others will necessarily get less. So money printing, even if it goes to workers, will simply be inflationary.

      • Don Stewart says:

        Dear Gail
        I think it is instructive to figure out what was wrong with Germany’s WWII effort to use coal to gasoline technology. Overall, there was a reduction in work performed, since more work had to be expended to transform the coal into gasoline. Yes, the Nazi’s could compel the production of the gasoline, in various ways, but they could not change the laws of physics.

        That is one reason why I have mentioned the ‘less useful work’ meme in several recent posts. The Federal Reserve can keep the tight oil drillers afloat by purchasing high yield debt and driving down their costs, and perhaps even converting the short term debt to very long term debt, but they can’t create more work potential out of resources which require so much work to produce the intermediate products.

        I think your writings, Hill’s model, and Richard Heinberg’s essay all make that point pretty well. There may be others who say the same thing.

        Don Stewart

        • “Yes, the Nazi’s could compel the production of the gasoline, in various ways, but they could not change the laws of physics.”

          Try flying fighter and bomber planes using coal. Try making coal-steam powered tanks. Sometimes, the form of the energy is more valuable than the total energy content, and it is worth losing 50 to 90% to convert to the desired form.

          • VPK says:

            Just read a very good read on Nazi scientists and their invention of converting coal to Petro. The process was 10X more expensive than conventional product but kept their war effort plugging after the loss of the Romanian oil fields. A command economy will disregard financial cost and do whatever means to keep the lights on and wheels turning.

        • Thanks! You are right. We are all saying the same thing.

  10. Don Stewart says:

    Dear Gail and Finite Worlders
    I have mentioned the ‘one brain, two minds’ model of how humans react in the real world. Here is a 4 minute clip of Pat Ogden, PhD, talking about how the sub-cortical parts of the brain seize control in a traumatic situation. Furthermore, people suffering from Post-Traumatic Stress Disorder can reactivate the loop long after the original stimulus has disappeared. From having heard her before, I know that Pat treats patients with an integrated mind/ body therapy.

    This may be important to any of you personally, as those close to you suffer traumatic shocks as the world we have known collapses. Perhaps it is worthwhile for you to spend a little time thinking about the issues of mind/ body functioning in a post collapse world.

    (I hope the link works. These are quirky.)….Don Stewart

  11. Don Stewart says:

    Dear Gail and Finite Worlders and Climate Change Believers
    Here is a video courtesy of Marjorie Wildcraft, from central Texas. She is visiting a permaculture farm in northern New Mexico, and learns how important diverse sources of food can be in a world of unstable climate. I’ll second that motion, due to the weather in North Carolina over the last few years. The stability we had come to expect, and had adjusted to, is gone. This also pertains to what I said about Gene Logsdon and cultivation. Annuals are still pretty dependent on cultivation, for the most part. However, some people are figuring out how to make do with a lot less cultivation…Don Stewart


    • richard says:

      Thanks for the link. I was reminded my surprise on finding out how complicated houses are, and the difficuties in adapting these to zero carbon concepts. Add to that the differences in climate even in small geographical areas, and a steady flow of new solutions and new materials and it is demanding to try to keep up with the changes.

      • Don Stewart says:

        Dear Richard

        Here is a little more on the question of microbes, the health of the natural world and the humans, and the different perspectives of soil scientists such as Elaine Ingham and ‘natural’ doctors and the Big Ag companies like Monsanto and the Big Pharma companies.

        I have recently posted this link to Stanley Hazen and his work at the Cleveland Clinic. It turns out that what we eat has a profound effect on the species of bacteria which thrive in our guts. If we eat red meat, we feed some bacteria which make TMAO which prevents us from getting rid of cholesterol, which encourages heart disease.


        Here is another video of Elaine Ingham explaining how bacteria and fungi are the key to soil and plant health. This short clip is part of Elaine’s long course on what we might call ’natural’ approaches to farming.


        Everyone who is serious now knows that the gut bacteria are important and that soil microbes are important. However, those who recognize the seriousness divide into two sharply divergent camps. The ‘natural’ doctors recommend eating the food that our gut microbes need to generate good health for the host human body. Stanley Hazen, right at the end of his talk, arrives at a quite different conclusion: the gut microbes are ‘druggable’. We can kill those we don’t want and create a better Darwinian climate for those we do want. This is Big Pharma and it’s money talking.

        The Big Ag people see the undoubted importance of soil microbes, and come to similar conclusions to Big Pharma. Rather than use Elaine’s rather simple and cheap program of growing some compost from the plants in your own neighborhood to inoculate the soil, plus stopping all the destructive practices such as antibiotics and pesticides and herbicides and plowing, Big Ag concludes that we need to drug the microbes in the soil. Kill those we don’t want, to create a better Darwinian climate for those we do want. In other words, keep doing everything we are doing now, plus some more.

        The gut microbes have been ‘medicated’ by the industrial food that we eat…in ways that are profoundly harmful to humans. With the new science, Big Pharma is confident that humans can both eat harmful foods but also medicate themselves so that the harm never actually materializes…and also make bales of money for Big Pharma. Big Ag sees the same opportunity, just applied to soil microbes. The Nanotechnologists likewise see big opportunities in letting humans continue with destructive practices, but offsetting the bad effects with technology.

        I’ll let you decide whether the ‘natural’ approach or the Corporate approach is the most appropriate for a Finite World.

        Don Stewart

        • Jarvis says:

          Don why would you want to get rid of cholesterol? My brain is 80% cholesterol so I’m keeping all I can. It’s inflammation not high cholesterol that causes heart disease and yes that is controlled by the gut.

        • Of course, even if the Big Pharma approach would work, the people who have to pay big Pharma for all of their products would be worse off, because of the cost of the big Pharma products, and the fact that they have to pay those costs to maintain the status quo.

  12. Don Stewart says:

    A little more on the Gene Logsdon article. This note from a local farmer:

    ‘It also dried out just enough to turn under the beautiful crimson clover and oat cover crop that will feed the winter squash. The last few years we have gone back to clean cultivated winter squash production instead of the no-till system we had used for many years, mostly in an effort to reduce some weed populations that had become too high. This now allows us to use crimson clover as the nitrogen source for the squash as it matures earlier than the hairy vetch that we use in the no-till mix and should provide plenty of nitrogen to grow a good crop.’

    This farmer uses a tractor to turn under the cover crop to supply the nitrogen for this summer’s crop. He does not use herbicides or pesticides. His tractor is small. His farm is probably too small to support a horse, but if he were a little larger, the horse and plow Logsdon describes might make sense.

    The farmer simply doesn’t have enough microbes in his soil to achieve the fertility and hostility to weeds that Elaine Ingham describes. If he were able to take 3 years off and just grow microbes and topsoil depth, everything might change. But I assure you he is not rich, and taking 3 years off is not an option.

    Elaine claims that farmers following her methods need to be prepared for one year of poor harvests.

    My conclusion: there is no magic wand. It is going to take some time to get to no-till, no herbicides, no pesticides. Steps in that direction are useful, and should be appreciated by us consumers.

    Don Stewart

  13. Don Stewart says:

    Dear Gail and Finite Worlders

    This will be a short note on making and executing a plan (or model) for surviving in a post-collapse world. Several people have expressed interest in the subject, recently.

    Let’s start with a quote from Mobus and Kalton, page 133:
    ‘Recent research in neuroscience is showing that concepts such as dog or horse, or a face, are present in consciousness when specific patches of neocortex light up in imaging investigations.’

    We first note that the images are in the neocortex…not the more primitive mid-brain. A reminder that Kelly McGonigal, the Stanford psychologist, tells us that we have one brain but two minds. The mid-brain is pretty much a captive to our impulses, while our frontal lobes are able to form concepts about what we really want. For more on Kelly’s work, I strongly suggest the purchase of her CD set, The Neuroscience of Change.

    As an example of the two minds at work, consider motherhood. If you randomly interrupt a mother and ask her how she is doing, or monitor her vital signs, you will frequently find that she is under stress, and not having much fun. But if you ask her, curing a rare moment of leisure, whether motherhood is rewarding, she is likely to report that it is very rewarding. Mothers are perhaps the best example we have that all human relationships are not about money or immediate pleasure…that humans have the ability to work toward long term goals which transcend themselves.

    Kelly has a section in The Neuroscience of Change which talks about forming new habits: eating healthier food, exercising more, engaging in intellectually stimulating exercises, etc. Our frontal lobes know that these are ‘good things to do’, and we all make resolutions about them on New Years. But most of them fall by the wayside in the first few weeks of January. Why does the mid-brain take over from the frontal lobes?

    Kelly outlines some specific steps which greatly increase your chances of success in achieving the goals that your frontal lobes want to pursue. The first step is to zoom out and get your objectives stated in the broadest possible terms. For example, exercising is not, perhaps, a very noble goal. Having a healthy and beautiful body is a broader version. A very broad version is to achieve a body which is tuned to permit you to function at a very high level on lots of dimensions. Spend some time visualizing how you would function with a highly tuned body.

    The second step is to identify the obstacles in considerable detail. Visualize the obstacles. Now work out very specific responses to each of the obstacles. For example, suppose you have decided to eat healthier. You resolve to eat a lunch where half the plate is filled with vegetables. Now what can go wrong? For example, you might be tempted by the Blue Plate Special in the cafeteria…or you might go to a restaurant where eating half veggies isn’t really possible. You must work out what you are going to do, very specifically, to meet the challenges you can anticipate. Then you have to visualize meeting those challenges.

    If you go back to the Mobus and Kalton quote, you will discover that Kelly has caused you to create an image in your frontal lobes. You don’t have to create the image when temptation is urging your mid-brain to do something you will regret later. The image is already there, waiting to prompt you.

    The third step is to commit to doing the images you have formed in your frontal lobes. Every used car salesman knows that, as ridiculous as it sounds, getting some sort of verbal commitment on some aspect of the clunker is necessary if he wants to sell it to you. Experiments show that the commitment step is the most significant of all. Commitment makes the image very available to us…it’s called ‘prompting’ in the psychology world. TV advertisements use prompting incessantly. Political ads on the Internet try to get you to commit.

    What does this have to do with Industrial Collapse? Suppose you decide that you want to grow a garden capable of sustaining your family, and catch enough water to provide irrigation while also storing more water in the soil. You first have to work out some very specific steps that you will take. And probably those steps will happen over a period of several years, and may be modified as you live and learn. As Kelly says, you have to identify a set of steps that you are willing to live. If one of the steps is that you will always find time to spend an hour a day in the garden, then you need to visualize the obstacles, and visualize yourself overcoming the obstacles. You also need to be committed to achievement.

    The steps laid out by Kelly are not ‘one size fits all’. She asks you to look at your deepest values, and work backward to practical steps. Such a procedure is not for the cynical. Some people will want to assure their family’s survival, while others will join a group and work toward group survival. Some will think about bunkers.

    Kelly never talks about surviving Industrial Collapse…she talks about losing weight and exercising and laughing more and things which concern all of us everyday. However, the neuroscience is, I think, either the same or similar.

    Don Stewart

  14. Pingback: The Controlled Demolition of Our World | OmegaShock.com

  15. Don Stewart says:

    Dear Gal and Finite Worlders
    We have had numerous discussions about BW Hill’s models and forecasts for the future of oil. One thing you have to admit is that he is sticking his neck out. See:

    You will find this down in the comments…Don Stewart

    The petroleum industry has been living on borrowed money since the run up in prices began in 2008. The production cost curve began getting much steeper after conventional peaked in 2005.


    By our calculations the industry must now raise at least $1.3 trillion per year in extra funds to maintain present production levels. That figure is likely to double over the next year. Because there is an affordability cap that limits petroleum prices, these funds will never be re-payed. Once additional funding can no longer be procured, production will plummet, large scale defaults will commence, and the monetary financial system may cease functioning.

    • I don’t know that the Hill’s Group numbers are necessarily right, but the general idea is certainly true. Investment capital is one of the major limiting items in our current situation. So is affordability of oil, given current wages and debt levels.

      • richard says:

        I’m coming to the view that the Hill’s group may have made one or other misjudgements. Either that BAU will continue because an acceptable alternative to oil is available, causing oil to become yesterday’s fuel, or alternatively that there will be a passive acceptance of a move to a non-oil economy.
        I have not yet thought this through, so please do not shoot the messenger.
        I’d see, in the short run, a modest decline in oil production amid a significant increase in resources allocated to the sector – mining in general. In the remaining 90 percent of the economy, a one percent increase in efficiency would balance a one percent fall in production, so BAU continues. After that, things become problematic.
        I read somewhere that an efficient size of the FIRE sector is some four percent of the economy, so there is some “fat” there.

  16. Don Stewart says:

    Dear Gail and Finite Worlders

    I recommend two articles for reading. Both these are relevant to the models we use to interpret the world.

    The first article is by Gene Logsdon, the Contrary Farmer. He discusses what happens if one gives up on the notion that The Green Revolution really did save the world, admits that giving the Nobel to Norman Borlaug was a huge mistake, and gets on with the business of living with the reality of a photosynthesis budget.


    ‘It is amazing what happens to your mental calculations if you start thinking about a future based on the assumption that smaller farms are inevitable.’

    The second article can also be found at Resilence, where this link leads you, or at Art Berman’s own website. Art argues that the ‘fracklog’ is NOT because companies are waiting for higher prices, but because they don’t have the cash flow or the borrowing power to get the money to pay for completion.


    Don Stewart

    • Daddio7 says:

      Don, those were the best links ever. I followed one to the Small Farmers Journal. Four different small farms kept a diary of horse and teamster hours and expenses for several years. Very informative of the expense and effort of animal powered agriculture. They had photos of the horses and implements used. Looks like that would have been just as hard on my body as the John Deeres where, but a lot quieter.

    • Thanks! Regarding the Logsdon article, I would only point out that using a horse, pulling a metal plow, as illustrated in the photo, is not really within our photosynthesis budget. The use of metals (in the plow and in the horse fittings) requires at least coal, for the population we have today. There is also a question of whether with only wooden plows and wooden fittings for horses, it would make sense to use horses. But it is a step backwards, I agree.

      Thanks for pointing out what Berman was really saying in the article. I had briefly glanced at the article, but not figured out that was his point (the ‘fracklog’ is NOT because companies are waiting for higher prices, but because they don’t have the cash flow or the borrowing power to get the money to pay for completion)–this is one of the problems of scanning articles, and mostly looking at images. I have seen the same point elsewhere, and very much agree with it.

      • Don Stewart says:

        Dear Gail
        A Farm Extension agent from around Toledo was recently recognized for her work in getting farmers to reduce their damage to the soil and the pollution of Lake Erie. The interviewer asked ‘why don’t you go all the way and suggest that they adopt organic practices?’ She laughed and said ‘people have to walk before they can run’.

        While there are promising no-till/ no herbicide/ no pesticide practices around, they are too radical for most farmers. Gene Logsdon, in the article, would just be happy if farmers would stop destroying their soil through compaction and soil erosion and glyphosate. Elaine Ingham, the soil scientist, thinks that we have only one more opportunity to undo the soil compaction with deep tillage…then we will be out of diesel and out of soil. If Elaine is right and Gene is right, then what makes sense is to never adopt heavy machinery (as may be true for quite a few of the farmers who were at the Ohio event), or, if deep compaction layers have been created, to deep till one more time and then sell the heavy equipment to some greater fool. A horse and simple plow are not the destruction machines currently roaming the corn belt. Perhaps one step now, and then the step to the substitution of tree crops for the industrial feedstocks of corn and soy and a great reduction in tillage of any kind (as Mark Shepard is demonstrating in Wisconsin).

        I worked on a small farm which used excessive tillage. It is very hard to talk to a 60 year old farmer who sees getting out the tractor as the only solution to perennial weeds. We also had a microbiologist with advanced degrees (but no PhD) working on the farm. She despaired of trying to change the minds of those who are constantly in financial difficulty. One bad harvest and they lose the farm. She now has her own farm. It will, I think, take a new generation to bring big changes…or a collapse of the industrial system which will select very few survivors.

        Don Stewart

        • richard says:

          That higlighted many things I just did not know.
          Is there anywhere I can find some numbers illustrating this?

          • Don Stewart says:

            I don’t know of any single reference which might answer all your questions. I think that Elaine Ingham presents the most direct challenge to what most people think they know about farming and gardening. Here is a small part of a talk she gave in Mill’s River, North Carolina in Feburary, 2015. I was in the audience. The interest in her talk was astonishing. The organizers had planned for 80 or so people, and ended up with several hundred. They moved the venue twice, and ended up with the biggest room you can get in the booming metropolis of Mill’s River. If you take a glance at the room at the beginning, you will get the impression that the fire marshall wouldn’t have been too happy with this packed in crowd. These are mostly farmers, with a few of us gardeners and a sprinkling of educators.

            Elaine has slides showing how tree roots, for example, go down until they hit a compaction layer and then turn sideways (horizontal drilling isn’t really a new innovation!). The result is that the tree is more vulnerable to drought, since it can’t put down deep roots. Annual garden plants can put roots down 15 feet…if there is no compaction layer. Heavy equipment, particularly when driven over wet soil, creates compaction layers. Plows, especially when used on wet soil, create what is called a ‘plow pan’…a layer of compaction just below the plow depth. Gene Logsden published a photograph of a massive tractor from his neighborhood sunk in mud up to the cab ..because the farmer thought he needed to get his crop in despite the wet soil. A compaction layer creates an anaerobic layer which plant roots cannot tolerate, as well as obstructing the flow of water to the plant.

            I can’t remember exactly what is in the introduction which is in the link below, but Elaine will talk about the importance of the soil food web. It may be in later parts of the talk (not yet available on video) where she talks about the fertilizer issue, and how we don’t actually need to add fertilizer if we have a vibrant soil food web breaking down the chemicals which are in all soils.

            I should add that there are people I respect who think that Elaine is wrong about the fertilizer issue. For example, I posted a short paragraph by a local farmer who plants a cover crop of clover to put nitrogen into the soil, and tills the clover in before planting his cash crop. I know that that farmer has not achieved much in the way of soil organic matter. He’s about 2 percent, while Jean-Martin Fortier is about 14 percent on his farm in Quebec. Organic matter is the carbon energy source for the soil food web. With 2 percent, you haven’t got enough to feed the microbes, and so they won’t work their magic on the chemicals in the soil.

            I don’t want to sound too dogmatic on these issues. I think compaction is clearly a bad thing. Using subsoilers to break up compaction layers only helps in the short term, if we are going to go right back to using heavy equipment on the soil. Whether the soil food web with lots of organic matter to feast on eliminates the need for all fertilizers is still a question mark. At the farming conference where Elaine talked and I attended, most of the presentations were about clever ways to get more nutrients into the soil, such as the clover cover crop followed by the cash crop, and complicated crop rotation schemes. Elaine’s methods are quite different.

            Don Stewart

            • richard says:

              @Don, thanks for the link. More on microbiology and modern living in this link
              “In 2008 a military helicopter chanced upon a previously uncharted group of huts in the remote Amazonas region in southern Venezuela, home to 15,000 Yanomami people. Thought to have been completely isolated since their ancestors arrived in South America after the last ice age, the semi-nomadic hunter-gatherers have never been exposed to modern civilisation – therefore neither have their guts.”
              “The microbes we are born with – which mainly come from our mother’s birth canal – form the basis of our lifelong microbiome. We are literally covered in them, inside and out. But modern life can alter the microbial composition. The use of antibiotics, processed foods and soap may have led to less diversity in our microbes according to Dr Gautam Dantas from the Washington School of Medicine, one of the researchers who has studied the Yanomami people.”
              “She says American infants have, on average, two courses of antibiotics in the first year of life – and one in three of those children will have been delivered by Caesarean section – one in two if they happen to be born in Brazil.”
              “Dr Dominguez-Bellow was surprised by some of the findings – the microbes from their skin and gut were 40% more diverse than those of modern, urbanised people. “In the intestine they have a diversity that really shocked us, which we think are providing a lot of important roles in digestion and in communicating with our immune system.”
              “ One other surprising finding was that the microbes from the Yanomami have antibiotic resistance genes despite never having encountered modern antibiotics – although they are not “switched on”.”

            • Maybe their ancestors had advanced technology, and collapsed. Or maybe aliens.

      • Jan Steinman says:

        … for the population we have today

        That is the key factor, no?

        Nine-tenths of our trophic calories come from fossil sunlight. That means, in rough numbers, nine-tenths of “consumers” will have to “go away” as fossil sunlight goes away.

        Some of us could lose some weight, and there’s a lot of food wasted that could be put to use, but I just don’t see an easy way around this.

        The silver lining is that the survivors just might be able to maintain some appropriate technology, something more than mere fire, or the wheel.

        Metallurgy existed before fossil sunlight was exploited. (In fact, it was a major cause of deforestation.)

        The real question is, once things “reset” to a photosynthetic level of energy, will the surviving humans be smart enough to look at the past and say, “Whew! Dodged that bullet! Let’s not do that again…”

        But I think probably not. (“Mommy, what is a ‘bullet?” And the following generation picks up the ball and runs with it…)

        • “The real question is, once things “reset” to a photosynthetic level of energy, will the surviving humans be smart enough to look at the past and say, “Whew! Dodged that bullet! Let’s not do that again…””

          They won’t have the resources to repeat the industrial process. If it all falls apart, this will be the pinnacle of human civilization.

          • Jan Steinman says:

            They won’t have the resources to repeat the industrial process.

            I wouldn’t argue that civilization, as we know it, can be recreated on a photosynthetic basis.

            What I was not communicating very well was that we don’t have to go all the way back to the stone age.

            With an appropriate population base and an appropriate amount of energy, there exists an appropriate technology level. We can have simple iron metallurgy based on charcoal.

            Of course, if the population and energy are out-of-balance, we’ll end up mowing down all the trees, and then we’ll have to descend to an even lower technology level.

    • richard says:

      It seems that Monsanto may have patented something that does not work except in the short term, if Roundup is not cost effective in the long run.

  17. Tolstoy's Degenerate Grandson says:

    Danger, danger…. everywhere one looks….

    Negative interest rates put world on course for biggest mass default in history

    More than €2 trillion-worth of eurozone government bonds trade on a negative interest rate. It’s a bubble that is bound to end badly

    Here’s an astonishing statistic; more than 30pc of all government debt in the eurozone – around €2 trillion of securities in total – is trading on a negative interest rate.

    With the advent of European Central Bank quantitative easing, what began four months ago when 10-year Swiss yields turned negative for the first time has snowballed into a veritable avalanche of negative rates across European government bond markets. In the hunt for apparently “safe assets”, investors have thrown caution to the wind, and collectively determined to pay governments for the privilege of lending to them.

    On a country by country basis, the statistics are even more startling. According to investment bank Jefferies, some 70pc of all German bunds now trade on a negative yield. In France, it’s 50pc, and even in Spain, which was widely thought insolvent only a few years ago, it’s 17pc.

    Not only has this never happened before on such a scale, but it marks a scarcely believable turnaround on the situation at the height of the eurozone crisis just a little while back, when some European bond markets traded on yields that reflected the very real possibility of default.

    Yet far from being a welcome sign of returning economic confidence, this almost surreal state of affairs actually signals the very reverse. How did we get here, and what does it mean for the future? Whichever way you come at it, the answer to this second question is not good, not good at all.

    Read More: http://www.telegraph.co.uk/finance/comment/jeremy-warner/11569329/Jeremy-Warner-Negative-interest-rates-put-world-on-course-for-biggest-mass-default-in-history.html

    • Thanks! I need to write an article related to this. We are in a real danger zone now, in my view.

    • B9K9 says:

      Damn Paul, you’ve been on quite a roll quelling hope & dashing dreams. LOL

      Gail’s place is simply a hang-out for people who have nothing better to do. One may know the jig is up, but there’s still entertaining banter in which to engage in order to pass the time more pleasantly.

      The essential problem is that once one is born ie a cognizant, living breathing organism, they assume a position in the long parade of thousands of previous generations who also thought that they and their particular circumstances were unique.

      Thousands/millions of people check-in and check-out every day; it’s a never ending, continuous process. No one is special, no one is unique. As your grandfather so eloquently argued, each and everyone of us is simply a product of our relative time – he strongly denounced the ‘great man’ theory of history.

      So here we are at a moment in time where only a few generations ago our forefathers stumbled upon, and developed mechanical engines that utilized approximately, 200m years of stored solar energy in the form of fossil fuels. So we clever bald apes, instead of using sticks and fires, use steel and … fire.

      Big advance – yawn. But of course it was only a temporary salve, however in the meantime, global population ballooned to the point where it is now orders of magnitude beyond any conceivable sustainable basis.

      So what happens when the crutch is removed? Look, it’s not a bad thing, it’s not a good thing, it just IS. Getting all worked up about possible solutions, when none exist, and never did exist, is just a way to pass the time. If you really, really believe that this is it – and I do – then you would spend your precious moments absolutely feasting off our current bounty. And I do – trust me, I do.

      • You have more or less hit upon the reason I haven’t hugely cut back in my own consumption. We have what time we have. Cutting back hugely doesn’t fix the situation. At best, it leaves some for someone else.

        In terms of how worthwhile the discussion is, I see two ways it is valuable:

        (1) It is valuable to me, because it helps me see viewpoints and articles that I would not have been able to see otherwise. I could not possibly pull together the story without the help of others. Adding in a few high-priced trips to see the world hasn’t hurt either.

        (2) It is valuable to commenters, partly because it provides them with a chance to interact with other commenters who are going through somewhat the same experience. It is a difficult situation. It also gives them a chance to further knowledge in the area–how this really is going to work out, if there might be something we can do now–by adding their comments to the discussion.

        I think too that we should respect commenters choice of name change, if they are behaving in a reasonable manner.

    • kesar0 says:

      I just reached for some old books read 20 years ago. And I found this – the beginning of the first chapter quotation:

      ” The world has been slow to realize that we are living this year in the shadow of one of the greatest economic catastrophes of modern history. But now that the man in the street has become aware of what is happening, he, not knowing the why and wherefore, is as full to-day of what may prove excessive fears as, previously, when the trouble was first coming on, he was lacking in what would have been a reasonable anxiety. He begins to doubt the future. Is he now awakening from a pleasant dream to face the darkness of facts? Or dropping off into a nightmare which will pass away?

      He need not be doubtful. The other was not a dream. This is a nightmare, which will pass away with the morning. For the resources of nature and men’s devices are just as fertile and productive as they were. The rate of our progress towards solving the material problems of life is not less rapid. We are as capable as before of affording for everyone a high standard of life—high, I mean, compared with, say, twenty years ago—and will soon learn to afford a standard higher still. We were not previously deceived. But to-day we have involved ourselves in a colossal muddle, having blundered in the control of a delicate machine, the working of which we do not understand. The result is that our possibilities of wealth may run to waste for a time—perhaps for a long time.

      I doubt whether I can hope, in these articles, to bring what is in my mind into fully effective touch with the mind of the reader. I shall be saying too much for the layman, too little for the expert. For—though no one will believe it—economics is a technical and difficult subject. It is even becoming a science. However, I will do my best—at the cost of leaving out, because it is too complicated, much that is necessary to a complete understanding of contemporary events.

      First of all, the extreme violence of the slump is to be noticed. In the three leading industrial countries of the world—the United States, Great Britain, and Germany—10,000,000 workers stand idle. There is scarcely an important industry anywhere earning enough profit to make it expand—which is the test of progress. At the same time, in the countries of primary production the output of mining and of agriculture is selling, in the case of almost every important commodity, at a price which, for many or for the majority of producers, does not cover its cost. In 1921, when prices fell as heavily, the fall was from a boom level at which producers were making abnormal profits; and there is no example in modern history of so great and rapid a fall of prices from a normal figure as has occurred in the past year. Hence the magnitude of the catastrophe.”

      Any references, association? Any flashbacks? This is the beginning of the “THE GREAT SLUMP OF 1930” from JOHN MAYNARD KEYNES. Further events are not very optimistic forecast.

      • kesar0 says:

        and a link for those interested in further reading:


      • There was huge job loss as the use of coal allowed horses to take on more of the former work of farmers (because of the metal tools and fittings for horses it permitted), according to one source I read. There was also a huge debt bubble that collapsed. In many ways, this was a demand-based collapse as well: few jobs for would-be workers, so no one could afford the food and other commodities that were available.

        • kesar0 says:

          I agree that it was demand destruction crisis. What the central banks are now doing is fully based on Keynes teachings. Broaden the monetary base and soften the credit crunch. It gave us 10-15 more years but the supply destruction crisis is inevitable at some point and another QE-type policies will not save us.

    • richard says:

      Disappointing. Read David Stockman’s post today on ZeroHedge, and the comment to the effect that all banking is fraud, hence there are real problems in having that much fraud on the books.
      ” Thus, the old-fashioned business of pegging the Federal funds rate and the new-fangled intrusion of massive bond buying under QE are all the same maneuver. They both involve expansion of the central bank balance sheet and, therefore, the systematic injection of fraud into the financial system.”
      We have become conditioned to believing six impossible things before breakfast.
      I’d add that for the UK, QE was preceded by PFI financing, merely a method for keeping debt off the government’s balance sheet, and similarly for some eurozone countries.
      Just for future reference, the Atlanta Fed has followed up its 0.1% 2015Q1 GDP forecast with and opening bid of 0.9% for Q2.

      • Tolstoy's Degenerate Grandson says:

        I agree – we are in some sort of twilight zone.

        But what Stockman and the likes of Paul Craig Roberts and ‘Tyler Durden’ fail to understand is that the central bankers are not insane or stupid.

        There are doing EXACTLY what needs to be done (and have been doing so for many years) to prolong BAU for as long as possible.

        When civilization is at stake the old rules of economics no longer apply. You need to think outside the box Sure money printing will not end well, but this is not going to end well no matter what we do. So if QE gets us another decade or even another month, why not.

        Nothing is off the table.

        Dr Frankenstein will be permitted to do whatever he wants. Because we are beyond desperate

        • Gary says:

          So if you had 120,000 USD to “invest”… what would you do?

          • Jan Steinman says:

            if you had 120,000 USD to “invest”… what would you do?

            If I had US$120,000 more to invest right now, I’d pay down our mortgage. I sorta wish I’d never consorted with the enemy, but then I wouldn’t be living in paradise!

            But I can’t advise that unless you’ve got a mortgage on property on which you want to weather the storm. And if you think you need to leave where you are, you’d best get working on it!

            So if I were starting from scratch, I’d pick a location and shop for some land that could be made productive fairly quickly. My criteria were to be somewhat isolated, but close enough to markets to be able to build on BaU until the excrement is applied to the ventilator. I wanted to optimize for multiple scenarios: what would happen there in a quick crash? Slow crash? No crash? Runaway global warming? Runaway industrial processes (nuclear)?

            I specifically chose an island, for positive and negative reasons. On the positive side, an island has a built-in sense of community, and is already as localized as the rest of the industrial world will have to become. On the flip side, if roaming hoards of starving zombies are looting farms, it will be nice to have a moat. In other words, we have to be somewhat energy-rich to shop at a Mall*Wart, but refugees will have to be somewhat energy-rich to get to us.

            Anyway, that’s my plan, and I’m stickin’ to it. I don’t expect anyone else to have the same criteria.

            • Gary says:

              I’d say that you are orders of magnitude ahead of those of us with no assets apart from savings and no plan 🙂

            • Jan Steinman says:

              Better get crankin’, then!

              There’s lots of places you could get a decent bit of land and a sound Airstream for $120k. Then start building your sod house… 🙂

            • Daddio7 says:

              More like Napoleon XIV! They’re coming to take him away.

            • Tolstoy's Degenerate Grandson says:

              Or… since you will at some point not be paying the mortgage back… leverage a portion of the money to buy an even better piece of property and make the low interest payments on it till collapse hits.

              Money for nothing. Chicks for free.

            • kesar0 says:

              I assume you’ll be disappointed. The system won’t collapse so fast. First the governments will try to save the financial system. Taking a loan is a risky game.

            • Jan Steinman says:

              since you will at some point not be paying the mortgage back

              I’m not so sure about that.

              You have the luxury of planning for exactly one scenario that you are certain will happen.

              While I agree that things are going to fall apart eventually, I am not so certain about the speed and nature of the collapse, and so diversify my planning for multiple scenarios.

        • richard says:

          “central bankers are not insane or stupid.” Fair enough. But would you agree the QE is the result of a goalseeked outcome where the greater good is of no consequence?

          • Tolstoy's Degenerate Grandson says:

            I believe that QE is about delaying the collapse of civilization and the likely extinction on all life on the planet when nuclear fuel ponds cannot be managed.

            Everyone benefits from QE from billionaires to paupers. Because without QE the global economy would have collapsed in 2008.

            I absolutely disagree with the position of many – including Zero Hedge editors – that QE was about enriching cronies. Yes, it has enriched them. but the primary purpose was to keep the hamster running a little longer.

            If I was a billionaire there is no way I would support policies that will collapse the Monopoly board and sending me into the gutter. I only support seemingly insane policies because they are sound responses to an extreme crisis – and they allow me to roam about on my yacht and private jet for a few more years.

            • kesar says:

              Reading you, I can tell that you don’t seem to be a happy person. You just need to embrace it and admire the beauty of the world we live in. We are seeing the peak of human civilization with all those technical toys like Internet and from the first, quite comfortable sits (comparing to those restless souls living in ghettos all over the world from Kalkuta to Baltimore) we’re wittnesing the process of collapse. In terms of historical monumental events, what could be greater one? Interersting times we live in…

            • Jan Steinman says:

              In terms of historical monumental events, what could be greater one? Interersting times we live in…

              Interesting times indeed!

              I feel fortunate to be in such times.

              I recall as a young adult, wishing there was still a frontier to explore. I briefly toyed with studying and working hard to get into the outer space program.

              So instead, I’m in the “inner space” program. It seems to be a lot more challenging!

            • Tolstoy's Degenerate Grandson says:

              When one reaches the conclusion that there is no way out of this.

              That farming or solar panels or thorium or god are nothing more than various flavours of the same thing – hopium – that allow us to deny or at least mask reality, then I don’t see how the future that is imminent can be referred to as an eagerly anticipated adventure.

              The future will be nothing less than an absolute nightmare.

              The mind is powerful and in most people it overrides logic when necessary to protect itself. In most, not all.

            • Gary says:

              As far as

              hopium… and (t)he future will be nothing less than an absolute nightmare.

              that assumes facts not in evidence. It’s simply a subjective expression. C’est la vie

            • Tolstoy's Degenerate Grandson says:


              – the global economy will only operate if there is a growing supply of cheap to extract oil

              – we are years past the peak of cheap to extract oil

              – QE and other stimulus policies have delayed the collapse of the global economy

              – unless you believe QE is a perpetual economic growth machine then you would need to conclude that at some point, no matter how many trillions we print, it will have no effect

              – when the global economy collapses it will result in the end of civilization as we know it – without fossil fuels we return to the way things were before fossil fuels, only we do not have any of the skills to adapt to such a situation

              – we feed 7+B people using petroleum based fertilizers and pesticides – these will not exist post collapse. – compounding this, land that has been farmed industrially (98% of all ag land is farmed this way) will grow nothing without years of organic inputs – so there will mass global starvation as soon as the grocery stores are looted and emptied.

              – in addition to starvation, diseases such as cholera will rampage through the planet as we are unable to provide clean water because the chemicals that we use to treat water will not be available

              – unimaginable levels of violence will burst across the planet as hordes of people do anything to try to feed their families – security will be virtually non-existent — violent criminals will have free reign – to see what is coming refer to failed states such as Afghanistan after the Russians were defeated – violent gangs and war lords were in control – the entire world will be a failed state

              – and then we have this (yes I know as you read this cognitive dissonance will flood your mind and you will go into a state of denial – you will simply dismiss the fact that one pond contains up to 400 tonnes of death compared to the couple of hundred pounds that were in the bombs dropped on Japan) – you will also dismiss the author even though he is a top expert on atomic energy

              Containing radiation equivalent to 14,000 times the amount released in the atomic bomb attack on Hiroshima 68 years ago, more than 1,300 used fuel rod assemblies packed tightly together need to be removed from a building that is vulnerable to collapse, should another large earthquake hit the area. http://www.reuters.com/article/2013/08/14/us-japan-fukushima-insight-idUSBRE97D00M20130814

              The problem is if the spent fuel gets too close, they will produce a fission reaction and explode with a force much larger than any fission bomb given the total amount of fuel on the site. All the fuel in all the reactors and all the storage pools at this site (1760 tons of Uranium per slide #4) would be consumed in such a mega-explosion.

              In comparison, Fat Man and Little Boy weapons dropped on Hiroshima and Nagasaki contained less than a hundred pounds each of fissile material – See more at: http://www.dcbureau.org/20110314781/natural-resources-news-service/fission-criticality-in-cooling-ponds-threaten-explosion-at-fukushima.html

              A typical 1 GWe PWR core contains about 80 t fuels. Each year about one third of the core fuel is discharged into the pool. A pool with 15 year storage capacity will hold about 400 t spent fuel.

              To estimate the Cs-137 inventory in the pool, for example, we assume the Cs137 inventory at shutdown is about 0.1 MCi/tU with a burn-up of 50,000 MWt-day/tU, thus the pool with 400 t of ten year old SNF would hold about 33 MCi Cs-137. [7]

              Assuming a 50-100% Cs137 release during a spent fuel fire, [8] the consequence of the Cs-137 exceed those of the Chernobyl accident 8-17 times (2MCi release from Chernobyl). Based on the wedge model, the contaminated land areas can be estimated. [9] For example, for a scenario of a 50% Cs-137 release from a 400 t SNF pool, about 95,000 km² (as far as 1,350 km) would be contaminated above 15 Ci/km² (as compared to 10,000 km² contaminated area above 15 Ci/km² at Chernobyl).


              Those the facts.

              If you don’t agree then remember 2008 when hundreds of thousands of jobs were being shed in America. Now imagine what would have happened if that continued for much longer. Millions upon millions of jobs lost, eventually a total and utter collapse of the job market. No money. No food. No nothing. Everything you take for granted would be gone. You’d have whatever food is in your home – and then nothing.

              BP (Beyond Petroleum) will be a nightmare. If anyone is unable to see that it is because they are blocking that reality out and no amount of facts will be able to pierce that mind shield.

            • Whether spent fuel ponds can explode or not, if they are not emptied with the last of BAU, 1000 reactors worth of spent fuel ponds would be a lot of contamination. Going with 15 years worth, that’s 15,000 Chernobyls worth as a rough number. That is really the single most important task for humanity before the lights go out.

            • Tolstoy's Degenerate Grandson says:

              Again, if they could be emptied or somehow made safe, why did we need them in the first place.

              I have already posted why fuel needs to remain in spent fuel ponds. Feel free to google that.

            • “I have already posted why fuel needs to remain in spent fuel ponds.”

              The ponds only need active circulation because they are overfilled beyond their original designed density. The racks are a mix ranging from hot out of the reactor, to 20 years old. If the racks over 10 years old are removed, the density may be low enough that the remainder would not need active circulation powered by pumps from generators or the power grid; they could simply cool through convection.

            • Tolstoy's Degenerate Grandson says:

              Do you have a scientific basis for that – or did you just make it up?

              Yes, I suppose we could just park them next to a cool breeze coming off the ocean.

              Or better still, why don’t we ship them to the antarctic and store them there?

              This silly high tech spent fuel ponds – I bet Haliburton invented them so that they could milk governments for construction and management fees.

              Let’s come out of the twilight zone and back to reality:

              The 2008 NRC guideline calls for fuels to have spent at least five years in a storage pool before being moved to dry casks. The industry norm is about 10 years.


              One of the most hazardous materials made by man is spent nuclear fuel—the used fuel periodically removed from reactors in nuclear power plants. Without protective shielding, the fuel’s intense radioactivity can kill a person exposed directly to it within minutes or cause cancer in those who receive smaller doses.

              As the fuel ages, it begins to cool and becomes less radiologically dangerous—some of the radioactive particles decay quickly, within days or weeks, while others exist for many thousands of years

              Safe management of spent fuel rods is a major challenge. Because the U.S. has no permanent repository for high level nuclear waste, the 103 active nuclear power reactors in the U.S. store their spent fuel rod assemblies in on-site cooling ponds, 40 feet deep, steel-lined and with concrete walls up to six feet thick.

              The spent rods must remain in cooling pools for five to ten years under least 20 feet of actively circulating water. Loss of cooling water to a cooling pool is extremely dangerous, as it can lead to an explosion and catastrophic release or radiation, as was demonstrated in Fukushima.

              Today there are 103 active nuclear power reactors in the U.S. They generate 2,000 metric tons of spent nuclear waste per year and to date have accumulated 71,862 tons of spent fuel, according to industry data.[vi]

              Of that total, 54,696 tons are stored in cooling pools and only 17,166 tons in the relatively safer dry cask storage.


            • Gary says:


              BP (Beyond Petroleum) will be a nightmare. If anyone is unable to see that it is because they are blocking that reality out and no amount of facts will be able to pierce that mind shield.

              See cognitive dissonance. I describe cognitive dissonance (and you might describe it differently) that when objective facts and subjective values/beliefs come into conflict, motivated reasoning and confirmation bias favor values/beliefs. Is there a monolithic set of beliefs and facts and values which lay out a scenario for the future other than the one you described… or is your description of the future the only realistic version? Just curious… no snark or disrespect intended for your perspective based on the facts you laid out. I’m wondering if you have explored alternatives or if you are thoroughly convinced of this doomsday scenario.

            • Tolstoy's Degenerate Grandson says:

              My definition of cognitive dissonance would be that when faced with overwhelming facts that contradict something you believe (and that belief is not supported by much if anything in the way of facts), you refused to relinquish your belief.

              The fact that most people believe in one of literally hundreds of religions is supreme evidence of mass cognitive dissonance.

              If you believe in Buddhism and I believe in Islam then someone is wrong… in fact everyone is wrong who does not believe in what you believe. But of course a religious person’s mind will jump in to come up with some sort of nonsense to rationalize this irrationality.

              How anyone who understands that oil is soon to stop flowing can still believe that there will be anything resembling civilization after that moment is delusional.

              There will be no jobs. There will be very little food.

              To get a slight taste of what is to come turn off your power for a weekend and don’t use your car.

              Wishful thinking. If it makes you happy why not.

            • Jan Steinman says:

              To get a slight taste of what is to come turn off your power for a weekend and don’t use your car.

              I live on an island where we often lose power during winter storms, sometimes, for days at a time. I typically drive twice a week.

              I realize I’m an “outlier,” even here on this island; when the power goes off, many islanders simply go stay with relatives on the mainland until the “problem goes away.” So your point is well-taken.

              On the other hand, there is no reason one cannot prepare for such things, so I’d go further: turn off your power and don’t drive for a whole weekend, once a month!

              The first time will be scary and disconcerting. Soon, you’ll be “prepping” for the event, and may even turn it into a party, cooking hot-dogs on sticks over an open fire in the back yard with the kids.

              Then, bump it up to two weekends a month. The “event” has now become a “life style,” and you will have to put your extra resources toward “surviving” these periodic disruptions — and I don’t mean stocking up on freeze-dried food!

              Once you’re comfortable with that habit, you can take the next step: find a job that pays less, but takes way less time. Put all that extra time into low-capital ways of becoming self-sufficient. Buy seeds, not solar panels!

              Doing these things will not guarantee survival. But they certainly will up the odds!

              The point is that gaining a post-carbon life-style is a process, not an event.

            • Gary says:

              Even though your comment wasn’t directed to me, may I respond “point well taken”? 🙂

            • Tolstoy's Degenerate Grandson says:

              Jan – worth trying but I don’t think anything will truly prepare anyone for a post carbon world.

              A weekend without power is nothing compared to an eternity without electricity.

              That said, it would give those who think a post carbon world is easy stuff a dose of reality.

              Here’s another little test. Buy and axe, fell a tree and split the wood then carry it back to where you can store it under shelter without using a motorized vehicle.

              Now that is what might be referred to as a whole new ball game.

            • Jan Steinman says:

              Buy an axe, fell a tree and split the wood then carry it back to where you can store it under shelter without using a motorized vehicle.

              Okay, you’ve inspired me to go finish that goat cart I’ve been collecting old bicycles for… 🙂

              Keep in mind that the “prosperous way down” includes domestic animals. Before coal, there were mule teams, horse-drawn carriages, and yokes of oxen.


            • Gary says:

              Are you (personally) advocating for the perspective that a gradual contraction of the cheap fossil fuel global economy instead of a sudden, catastrophic, nightmarish collapse? Obviously attempting to construct a future scenario is immensely problematic. Also, obviously, there is a huge potential for motivated reasoning, denial, irrational skepticism, etc to employ exuberant optimism that the future will not be nightmarish. Most obviously, prepare for the worst is pragmatic. I think I’ll check out the eco-village you linked to. I accept the reality of our social nature and the benefits of community much more than the “go it alone” or “resign yourself to doom and starvation” scenarios. Hopium?

            • Gary says:


              Is there a monolithic set of beliefs and facts and values which lay out a scenario for the future other than the one you described?

              You and I are probably more in agreement than disagreement wrt cognitive dissonance, denial, motivated reasoning, confirmation bias, wishful thinking, hopium, etc. Whether the existence of thousands of subsets of ideological thinking about mythology is an example of cognitive dissonance or not is another discussion. I’m simply asking for your opinion on this question I’m re-posting. Yes? No? I don’t know? Is there only one realistic scenario from your perspective? The future is determined? Is there no contingency/random chance scenario which is feasible?

            • Tolstoy's Degenerate Grandson says:

              Yes the future is certain. It has to be a nightmare. How can it not be?

              Civilization as we know it only exists because of fossil fuels, 7B people exist only because of fossil fuels

              Fossil fuels are not infinite.

              Barring a miracle, we are definitely not going to have much in the way of energy in the very near future.

              That means civilization ends. It means billions starve and die. It means spent fuel ponds will not be able to be controlled which will result in an extinction event or if not a world with open sores pouring radiation into the atmosphere for years.

              I have demonstrated that this is what is going to happen. The onus is on you to demonstrate that the Harvard report is incorrect.

              This is not grade 3 where you simply block your ears and refuse to acknowledge facts.


              Before you set off on your journey, you should know that I have exhaustively researched the topic of spent nuclear fuel ponds and they a) most definitely will not be able to be controlled without BAU fully functioning and b) when they are left uncooled they will explode like thousands of nuclear weapons and they will spread death globally.

              I could find nothing to counter those findings (and believe, I wanted to)

            • Gary says:


              yes I know as you read this cognitive dissonance will flood your mind and you will go into a state of denial

              Au contraire. I’m aware of the potential for massive radioactive ionization poisoning of the land and water in the event that nuclear reactor sites are not skillfully dismantled in the event of the global collapse of civilization. I’m increasingly aware of the information presented by Nature Bats Last and the possibility of NTHE and the probability that agricultural civilization (aka the Neolithic revolution) and industrialization aided by science is a progress trap… “the condition human societies experience when, in pursuing progress through human ingenuity, they inadvertently introduce problems they do not have the resources or political will to solve, for fear of short-term losses in status, stability or quality of life. This prevents further progress and sometimes leads to collapse.” So I am willing to question my own degree of insanity in participating in the scenario you present and my own degree of culpability and my own cognitive dissonance and my own confirmation bias/motivated reasoning. Is looking for an alternative scenario ethically and vehemently repugnant?

            • Tolstoy's Degenerate Grandson says:

              “in the event that nuclear reactor sites are not skillfully dismantled”

              How do you skillfully dismantle a spent nuclear fuel pond?

              If that were possible then why do we bother to place spent fuel into these ponds for years before dry casking them?

              I’ve already posted that is not possible to dry cask because the levels of radioactivity are far to high.

            • “If that were possible then why do we bother to place spent fuel into these ponds for years before dry casking them?”

              They are placed in there for 5-15 years because they must. They often stay longer due to:
              1. political BS: NIMBY voters and politicians preventing long term storage facilities.
              2. Costs money; why pay money to dry cask or reprocess the fuel, when you can just stuff more spent fuel racks into the ponds and just circulate the water a bit faster?

            • Tolstoy's Degenerate Grandson says:

              Again – do you just make this stuff up?

            • Have you really never heard of Yucca Mountain and Harry Reid’s tireless efforts to prevent long term nuclear storage, because the people of Las Vegas don’t want it in their State? http://en.wikipedia.org/wiki/Yucca_Mountain_nuclear_waste_repository

              As for the second part, I’ve already previously linked the NRC guidelines that say 5 years, but notes industry standard is 10 – meaning they do not do it BEFORE 10 years. You have provided links showing that spent fuel ponds on average store 15 years worth of fuel worldwide. Are you arguing with your own links and sources?

              Increased density at spent fuel ponds:

            • Tolstoy's Degenerate Grandson says:

              5 years – 10 years who cares.

              The fact is you absolutely cannot dry cask spent fuel right from the reactor. The fuel MUST go into high tech fuel ponds. It cannot simply be left in a warehouse or a hole in the ground with the gentle breeze cooling it

              And as that one link indicated there are thousands of tonnes of fuel that needs to be in ponds and more being loaded in every month.

              Because in case you were not aware, there are hundreds of live nuclear installations scattered around the planet.

            • “5 years – 10 years who cares.”

              That’s a pretty big difference; that’s twice as much spent fuel in the pond, probably needing four times as much circulation to prevent the water from boiling off. If the density is low enough, the ponds may be able to operate without electricity, which is a huge deal if BAU ends. If average is 15 years, taking 66% of the spent fuel out of all of the ponds is a massive gain in safety.

            • Tolstoy's Degenerate Grandson says:

              If you are going to suggest that these ponds can operate without electricity for years then you will need to provide a reference for that.

              Otherwise you are simply cluttering up the board with white noise.

              Wishful thinking does not qualify as a sound argument.

            • Westinghouse says can be cooled using gravity fed water supply at a rate slightly higher than 2 garden hoses to replace boil-off:

              Areva design for passive heat pipe cooling:

            • Tolstoy's Degenerate Grandson says:

              Link 1: The page cannot be found
              The page you are looking for might have been removed, had its name changed, or is temporarily unavailable.

              Second link: that’s a high tech system that requires a fully functional BAU to manufacture and provide spare parts. It requires electricity and it is only one of the components of a spent fuel pond.

              It might be helpful to take a class visit to an actual spent fuel pond:

              https://www.youtube.com/watch?v=UyuJfnSGBJ0 (note the ‘7-10 year’ period required before going to dry cask…)

              Do you really think that is something that can be operated post carbon?

              Keep in mind, post collapse we will not be able to manufacture simple things like a tube of toothpaste, or metal nail clippers, or a push bike. You need energy to make all of these things… you need energy to make spare parts and keep a fuel pond operational.

              Not gonna happen.

            • https://www.ukap1000application.com/PDFDocs/Safety/NPP_NPP_000067%20(SFP%20Cooling).pdf

              I’ll try again, the blog removed the .pdf from the link. Basically, as long as two garden hoses worth of water can be added by gravity to the spent fuel pond, the water can just gently boil off the top. Letting the roof blow off, or removing it, helps the heat transfer to the atmosphere faster. The Romans built aqueducts, and they could not sight curves, so I think we’ll be okay, as long as the show is being run by competent surveyors and engineers, and not politicians, bureaucrats and corporate tools trying to “save face”.

              Now is the time for the spare parts and dry casks to be made, so when the time comes, there is already the resources in place to move the old fuel into dry casks, the fuel fresh out of the reactors into the spent fuel ponds, and keep the ponds running for the ~10 years or so until they can be dry casked.

              This program, with federal government financing, could help keep up demand and help hold BAU together longer, too.

            • Fast Eddy says:

              Yes I am sure it is just that easy.

              We just move the fuel into large backyard swimming pools find a nearby bubbling spring and run the hose for 5 years….

              BTW – your link is still bad — can you inform Harvard University (or whichever esteemed institution that is putting out what is no doubt excellent research) that their server is down.

            • Jan Steinman says:

              It might be helpful to take a class visit to an actual spent fuel pond

              Yawn. Been there. Done that. They even let me bring a geiger counter.

              Nothing to see here, folks. Move on. Did you see the roiling clouds of steam? Did you notice the huge pumps running? Neither did I. This storage facility is stable without a grid — which cannot be said of the unspent fuel actually in reactors!

              Outside of a few scaremongers, spent fuel storage facilities do not pose any greater risk than mine tailings ponds. They cannot form a critical mass. They cannot explode.

              That doesn’t at all mean I support nuclear power. But we risk turning off everyday, thinking people when we rush to the lunatic fringe. We need to understand risk probabilities and impacts together.

              Yea, ten stories up in an earthquake zone is an incredibly stupid place to put spent nuclear fuel. And post-carbon, many of those facilities are going to start leaking. But compared to Mt. Polley and the thousands of other poisonous mine tailings ponds that are poised to breach if we lose the ability to constantly run diesel earth moving equipment, nuclear plant waste storage is not our biggest worry.

            • Fast Eddy says:

              Jan – I will pull the key statements from below:

              1. The problem is if the spent fuel gets too close, they will produce a fission reaction and explode with a force much larger than any fission bomb given the total amount of fuel on the site. All the fuel in all the reactors and all the storage pools at this site (1760 tons of Uranium per slide #4) would be consumed in such a mega-explosion.

              2. Assuming a 50-100% Cs137 release during a spent fuel fire, [8] the consequence of the Cs-137 exceed those of the Chernobyl accident 8-17 times (2MCi release from Chernobyl).


              At Fukushima TEPCO continues to furiously pour tonnes of sea water onto the fuel rods day after day, year after year. Clearly there must be a very bad outcome if those rods were just left to fester….

              Containing radiation equivalent to 14,000 times the amount released in the atomic bomb attack on Hiroshima 68 years ago, more than 1,300 used fuel rod assemblies packed tightly together need to be removed from a building that is vulnerable to collapse, should another large earthquake hit the area. http://www.reuters.com/article/2013/08/14/us-japan-fukushima-insight-idUSBRE97D00M20130814

              The problem is if the spent fuel gets too close, they will produce a fission reaction and explode with a force much larger than any fission bomb given the total amount of fuel on the site.

              All the fuel in all the reactors and all the storage pools at this site (1760 tons of Uranium per slide #4) would be consumed in such a mega-explosion.

              In comparison, Fat Man and Little Boy weapons dropped on Hiroshima and Nagasaki contained less than a hundred pounds each of fissile material – See more at: http://www.dcbureau.org/20110314781/natural-resources-news-service/fission-criticality-in-cooling-ponds-threaten-explosion-at-fukushima.html

              A typical 1 GWe PWR core contains about 80 t fuels. Each year about one third of the core fuel is discharged into the pool. A pool with 15 year storage capacity will hold about 400 t spent fuel.

              To estimate the Cs-137 inventory in the pool, for example, we assume the Cs137 inventory at shutdown is about 0.1 MCi/tU with a burn-up of 50,000 MWt-day/tU, thus the pool with 400 t of ten year old SNF would hold about 33 MCi Cs-137. [7]

              Assuming a 50-100% Cs137 release during a spent fuel fire, [8] the consequence of the Cs-137 exceed those of the Chernobyl accident 8-17 times (2MCi release from Chernobyl).

              Based on the wedge model, the contaminated land areas can be estimated. [9] For example, for a scenario of a 50% Cs-137 release from a 400 t SNF pool, about 95,000 km² (as far as 1,350 km) would be contaminated above 15 Ci/km² (as compared to 10,000 km² contaminated area above 15 Ci/km² at Chernobyl).


            • Jan Steinman says:

              1. The problem is if the spent fuel gets too close, they will produce a fission reaction and explode with a force much larger than any fission bomb given the total amount of fuel on the site. All the fuel in all the reactors and all the storage pools at this site (1760 tons of Uranium per slide #4) would be consumed in such a mega-explosion.

              Sorry, I lost my “suspension of disbelief” right there.

              Do you understand what an incredible amount of scientific and engineering work it is to obtain a “prompt criticality” explosion from nuclear fission? You don’t just put a bunch of depleted fuel into a swimming pool and drain the water out. Read some Tom Clancy, man! It takes micron-precision milling and microsecond-precision timed explosive charges!

              Consider what an “explosion” does: it blows stuff away. If by some nearly impossible quirk, an explosion began between a group of control rods, it would push the other rods away! This is called a “fizzle yield,” and is dangerous due to the dispersal of radioactive contamination, not because of explosive force. Much of the engineering work in fission bombs is to keep the “explosion” from happening, until the last possible instant, so that more of the fuel can be involved.

              Consider Occam’s Razor. Don’t you think that if it were this simple to produce a “mega-explosion” that way, terrorists would have done it by now? The spent fuel storage I visited was just tens of undefended metres from an international shipping waterway. If what you claim were true, it would have been trivial for terrorists to jump into a zodiac from some freight vessel, set a charge on the wall of the “swimming pool,” and nuke a million people in metropolitan Portland and suburbs!

              Finally, if what you claim were true — that depleted fuel rods could assemble a critical mass and explode — why hasn’t the 125-tonne core of Fukushima #1, which has undergone a complete melt-down, exploded?

              Yea, there’s a lot to worry about with nuclear power. Let’s not blow our credibility on important worries by making up incredible ones that simply won’t happen!

            • Gary says:


              How do you skillfully dismantle a spent nuclear fuel pond?

              I’m not saying it can be done and I’m not arguing that dry casking is feasible. I’m asking if nuclear scientists have more than one scenario than the scenario you have described. One way to approach confirmation bias is to look for evidence that one is mistaken with as much commitment as looking for reasons that one is correct. I assume that there are more scenarios than only one. If this is a false assumption on my part, mea culpa.

            • Tolstoy's Degenerate Grandson says:

              If there are other scenarios I cannot find them

              Instead of me doing all the heaving lifting, perhaps you could do some research into this since it is you who is doubting the Harvard paper

            • Tolstoy's Degenerate Grandson says:

              Well if you think that a world without energy is a paradise then you are in for a grand surprise.

              Suicide bombers believe they get virgins and milk and honey when it all ends for them.

            • Gary says:

              I assume that there is a middle ground between paradise and a complete, unrelenting nightmare. If I assume incorrectly, my bad.

            • Tolstoy's Degenerate Grandson says:

              There is no middle ground. We either grow or we wither and collapse back into the pre-fossil fuels period.

              Energy extraction and refining requires a fully functioning modern economy with sophisticated finance in place. And a modern economy (BAU) requires cheaply extractable energy.

              Therefore neither will exist post collapse

            • Gary says:

              So in your scenario contraction without collapse is impossible… if I read you correctly? In your view these guys… http://contractionism.org/ … are just addicted to hopium and wishful thinking and denial and irrational skepticism about a nightmarish collapse really being already predetermined… destined… fated… our lot/portion is doom. Is this a fair summary?

            • Tolstoy's Degenerate Grandson says:

              Let’s go to the real world to understand how BAU cannot continue without growth.

              Let’s say growth stops – what does that mean?

              – it means recession with job losses

              – if left unchecked job losses will continue which means the recession deepens because many people do not have jobs so they cannot buy stuff or pay for services

              – that means more job losses as companies revenues shrink so they lay off even more people

              – this also means less tax money for governments because people without jobs don’t pay taxes

              – at the same time governments need to care for these people without jobs (50 million on food stamps in the US at the moment)

              – as more jobs are lost we enter into a Depression

              – this also leads to a deflationary death spiral which again, if left unchecked (as you are suggesting) will completely collapse the global economy

              – the financial system would collapse, banks would cease to exist because they would be insolvent, trade would stop because there counter parties would not trust each other (credit would not be available)

              – the end of growth would be a death spiral. That is what was happening in 2008 with hundreds of thousands of jobs being shed in the US.

              – the ONLY thing that stopped the death spiral was stimulus and guarantees from the central banks which put the train back on the track

              – when the next iteration of this crisis hits the central banks will be powerless – they are using up every tool in the box to delay the next crash – negative interest rates, money printing, share buy backs you name it – they are doing it

              You are very soon going to see your little experiment with permanent no growth play out.

              Remember me when you are foraging for grass and bark in the forest post collapse.

            • B9K9 says:

              Kesar, exactly. TSD aka Paul (and, for the record Gail, a certain Barry Soetoro also changed his name) still isn’t quite there. From the likes of things, he’s still at the anger stage – expressed is veiled outrage and sarcasm.

              He, like Kunstler, PCR, Stockman, et al, are seemingly just emerging from full immersion brainwashing to discover that the USA, like European and countless other empires before it, have ALWAYS acted in a corrupt, self-serving manner. Here’s a little ditty from C Rhodes way back in 1877:


              … look at (America’s) government, are not the frauds that yearly come before the public view a disgrace to any country and especially their’s which is the finest in the world. Would they have occurred had they remained under English rule …?

              Once you become comfortable with the fact that nothing has ever been any different, and going forward, nothing is going to change, then you begin to embrace the notion that if the human condition is this violent – and it is – then be thankful you’re not imprisoned, mugged, shot, tortured or otherwise not sitting comfortably while cruising the interwebs.

              From that perspective, it’s all very, very good, and I for one am thankful I’m able to continue exploiting it to maximum advantage for personal enjoyment and satisfaction.

            • Tolstoy's Degenerate Grandson says:

              I am not clear what your comment has to do with what I posted.

              My point was that QE has been the greatest thing since sliced bread in that it has keep BAU going for 6 years and counting.

              I am on record plenty of times stating that the real power is the Fed and not the politicians or anyone else.

              “I care not what puppet is placed on the throne of England to rule the Empire, … The man that controls Britain’s money supply controls the British Empire. And I control the money supply.” Nathan Rothschild

              “Once a nation parts with the control of its currency and credit, it matters not who makes the nation’s laws. … Until the control of the issue of currency and credit is restored to government and recognized as its most sacred responsibility, all talk of the sovereignty of parliament and of democracy is idle and futile.” — Mackenzie King, Canadian Prime Minister 1935-1948.

              This is of course all about to change when we get blasted back to ground zero by the end of fossil fuels. No wonder these men are pulling out all stops to delay that moment as long as possible

            • richard says:

              @TSG – In 2008 many (most?) banks were – in the real world – insolvent, if any rational standard was applied. Whether you agree with the choices made or not, decisions were taken to a) use taxpayer money to re-capitalise the banks, and b) to reduce interest rates to ensure that both banks and governments did not become insolvent soon afterwards.
              I’d add that the levels of inter-bank lending, and of inter-bank derivatives, to judge only from the data available from the Lehman bankruptcy, seriously compromises the system.

            • Tolstoy's Degenerate Grandson says:

              A system relying on infinite growth was compromised from the moment it started due to the limits of growth in a finite world.

              What we are seeing are the people who manage this system desperately trying to patch together an engine that has reached the end of its life.

              Complaining that the methods they are using to keep the engine going a few more miles are destroying the integrity of the engine doesn’t make a whole lot of sense.

              The engine is finished no matter what we do. If pouring nitro into the carb gets us one final hurrah, then that’s what we should be doing. Fortunately the owners of the Fed understand this.

            • richard says:

              @TDG “Fact:” .. some questions …
              What is the percentage of fissile material (U235) in reactor grade uranium?
              What percentage, by weight, of this fissile material is found in a fuel rod assembly?
              What percentage, by weight is found in a “spent” fuel rod ? (clue – considerably less than natural uranium)
              What would be a reasonable comparison of a Fukushima fuel pool to the 140 lbs of U235 in the Hiroshima bomb?
              Not to diminish the problem, just getting the facts straight …

            • Tolstoy's Degenerate Grandson says:

              I did all the work researching what would happen if we were unable to manage spent fuel ponds when we collapse into an age without energy other than wood from trees.

              So I will hand this off to you.

              Why don’t you ask the guy who wrote this: http://belfercenter.hks.harvard.edu/publication/364/radiological_terrorism.html

              Hui Zhang

              Senior Research Associate, Project on Managing the Atom

              Telephone: 617-495-5710
              Fax: 617-496-0606
              Email: Hui_Zhang@harvard.edu


              Hui Zhang is a Senior Research Associate at the Project on Managing the Atom in the Belfer Center for Science and International Affairs at Harvard University’s John F. Kennedy School of Government. Hui Zhang is leading a research initiative on China’s nuclear policies for the Project on Managing the Atom in the Kennedy School of Government. His researches include verification techniques of nuclear arms control, the control of fissile material, nuclear terrorism, China’s nuclear policy, nuclear safeguards and non-proliferation, policy of nuclear fuel cycle and reprocessing.

              Before coming to the Kennedy School in September 1999, he was a post-doctoral fellow at the Center for Energy and Environmental Studies, Princeton University from 1997-1999, and in 1998-1999, he received a post-doctoral fellowship from the Social Science Research Council, a MacArthur Foundation program on International Peace and Security. From 2002-2003, he received a grant for Research and Writing from the John D. and Catherine T. MacArthur Foundation. Hui Zhang received his Ph.D. in nuclear physics in Beijing in 1996.

              Dr. Zhang is the author of several technical reports and book chapters, and dozens of articles in academic journals and the print media including Science and Global Security, Arms Control Today, Bulletin of Atomic Scientist, Disarmament Diplomacy, Disarmament Forum, the Non-proliferation Review, Washington Quarterly, Journal of Nuclear Materials Management , INESAP, and China Security. Dr. Zhang gives many oral presentations and talks in international conferences and organizations.

              Here have a great case study in cognitive dissonance.

              We have damning facts from a highly credible source. And not a single person is able to post anything refuting these facts.

              Yet the facts are rejected.

              This is like a Harvard math prof saying 1+1=2

              And me posting that. And you saying you do not agree.

              I am baffled by this phenomenon. I seek to understand how this works.

              Is it simply fear that drives people to throw all logic and common sense out the window?

              Al very amusing considering the audience mocks people who reject the conclusions put forward in the articles on this site.

              But they are no different than most of you. You can put as many facts in front of them and they will refuse to see – because seeing is frightening. It leads to deep despair.

              Likewise, accepting the report from the atomic energy expert is a place where most people refuse to go.

              To be quite honest, I prefer not to go into that dark corner. But I guess cognitive dissonance is failing me.

              I am unable to override the logic.

            • richard says:

              I’m just generally cleaning up the disinformation on Fukushima …
              The data in the video is a little out of date,
              And AFAIK no progress on the corium …

            • richard says:

              @Jan … Your reply describing the working of the fuel ponds and the melted NR1 core aligns with my limited knowledge on the subject, so thanks for that confirmation. I’ll add that I was born and part raised in a house without electricity, or plumbing, so I’ve seen a load of hysteria here, none of that from you BTW, I agree with your comments on that.

            • Jan Steinman says:

              I was born and part raised in a house without electricity, or plumbing, so I’ve seen a load of hysteria here…

              To play “devil’s advocate” here for a bit, there’s some grounds for hysteria: people who live in climate-controlled buildings with windows that don’t open, people totally dependent on refrigeration for their food supply, people who live in “gated communities” inhospitable to walking, with gates that won’t open without electricity, etc.

              For me and you, it might be damned inconvenient to be without electricity, but not particularly life-threatening. But many others have painted themselves into a corner without realizing it.

            • Stefeun says:

              There’s also a treshold effect: when a person (or a sub-system) gets connected to a bigger network (or the global supply-chain) for a given task or function, he/she/it loses control over that task, i.e. a part of his/her/its autonomy, self-sufficience and resilience. After a while, even the knowledge and ability to do without the external control are lost. In many cases it’s very difficult to go backwards. We find ourselves increasingly locked in systems we cannot control.

              In someone else’s words (hopefully more understandable):
              “Beyond the figures the book provides elements of analysis to understand why we fail to change our destructive behaviors. In particular, we will retain the concept of “socio-technical lock”, which explains how it is difficult and sometimes impossible to go back after the development of certain techniques. The example of agriculture is significant: it was widely shown now that a less intensive use of land and less petro-dependent could allow such good yields. But the development of industrial agriculture involved the deployment of infrastructure all become interdependent and too powerful for that new initiatives are developed, even if they are effective even if they are economically viable.”
              from a book review: https://translate.google.com/translate?sl=fr&tl=en&u=http%3A//adrastia.org/comment-tout-peut-seffondrer-pablo-servigne-raphael-stevens/

            • Fast Eddy says:

              Here’s another way to get a whiff of post-collapse (all this is theoretical because there will be no post-collapse due to radiation – but let’s do it as a mind exercise anyway)

              Stop using a washing machine to wash clothes. Do it all by hand.

              I’ve read somewhere that this was the task that took up the most time in a person’s day pre-Westinghouse.

              Baby steps: No fridge. No car. No stove. No running water. No washing machine.

              Try a day. Then a week.

            • Jan Steinman says:

              Stop using a washing machine to wash clothes. Do it all by hand. I’ve read somewhere that this was the task that took up the most time in a person’s day pre-Westinghouse.

              That doesn’t seem quite right.

              Our absurd obsession with cleanliness makes us wash things way more than needed. Even in modern-day Europe, people tend to hang their clothes out in the air, rather than obsessively wash them, unless they are quite soiled.

              I’d guess I could wash my clothes in under an hour a week. That’s about how often I change them! 🙂

              (I can just hear some of you going, “EEWWW!!” Get over it.)

            • Fast Eddy says:

              Once the fuel is uncovered, it could become hot enough to cause the metal cladding encasing the uranium fuel to rupture and catch fire, which in turn could further heat up the fuel until it suffers damage. Such an event could release large amounts of radioactive substances, such as cesium-137, into the environment. This would start in more recently discharged spent fuel, which is hotter than fuel that has been in the pool for a longer time. A typical spent fuel pool in the United States holds several hundred tons of fuel, so if a fire were to propagate from the hotter to the colder fuel a radioactive release could be very large.


              According to Dr. Kevin Crowley of the Nuclear and Radiation Studies Board, “successful terrorist attacks on spent fuel pools, though difficult, are possible. If an attack leads to a propagating zirconium cladding fire, it could result in the release of large amounts of radioactive material.”[12] The Nuclear Regulatory Commission after the September 11, 2001 attacks required American nuclear plants “to protect with high assurance” against specific threats involving certain numbers and capabilities of assailants. Plants were also required to “enhance the number of security officers” and to improve “access controls to the facilities”.

              The committee judges that successful terrorist attacks on spent fuel pools, though difficult, are possible. If an attack leads to a propagating zirconium cladding fire, it could result in the release of large amounts of radioactive material. The committee concluded that attacks by knowledgeable terrorists with access to appropriate technical means are possible. The committee identified several terrorist attack scenarios that it believed could partially or completely drain a spent fuel pool and lead to zirconium cladding fires. Details are provided in the committee’s classified report. I cannot discuss the details here.


              If any of the spent fuel rods in the pools do indeed catch fire, nuclear experts say, the high heat would loft the radiation in clouds that would spread the radioactivity.

              “It’s worse than a meltdown,” said David A. Lochbaum, a nuclear engineer at the Union of Concerned Scientists who worked as an instructor on the kinds of General Electric reactors used in Japan. “The reactor is inside thick walls, and the spent fuel of Reactors 1 and 3 is out in the open.”


              If you don’t cool the spent fuel, the temperature will rise and there may be a swift chain reaction that leads to spontaneous combustion–an explosion and fire of the spent fuel assemblies. Such a scenario would emit radioactive particles into the atmosphere.

              Pick your poison. Fresh fuel is hotter and more radioactive, but is only one fuel assembly. A pool of spent fuel will have dozens of assemblies. One report from Sankei News said that there are over 700 fuel assemblies stored in one pool at Fukushima. If they all caught fire, radioactive particles—including those lasting for as long as a decade—would be released into the air and eventually contaminate the land or, worse, be inhaled by people. “To me, the spent fuel is scarier. All those spent fuel assemblies are still extremely radioactive,” Dalnoki-Veress says.

              It has been known for more than two decades that, in case of a loss of water in the pool, convective air cooling would be relatively ineffective in such a “dense-packed” pool. Spent fuel recently discharged from a reactor could heat up relatively rapidly to temperatures at which the zircaloy fuel cladding could catch fire and the fuel’s volatile fission product, including 30-year half-life Cs, would be released. The fire could well spread to older spent fuel. The long-term land-contamination consequences of such an event could be significantly worse than those from Chernobyl.


              I believe there are close to 4000 active spent fuel ponds across the planet.

              Today there are 103 active nuclear power reactors in the U.S. They generate 2,000 metric tons of spent nuclear waste per year and to date have accumulated 71,862 tons of spent fuel, according to industry data.[vi] Of that total, 54,696 tons are stored in cooling pools and only 17,166 tons in the relatively safer dry cask storage. http://www.psr.org/environment-and-health/environmental-health-policy-institute/responses/the-growing-problem-of-spent-nuclear-fuel.html

              Here’s what where the radiation spreads from a single plant


              Like I said, this is an extinction event. That is why the PTB are doing nothing. There is no point in preparing for the post- collapse world.

              Because the planet will be poisoned.

            • Jan Steinman says:

              I agree completely that a spent fuel storage “incident” could be very serious indeed. But the amelioration effort seems to be quite low. Assuming a supply of diesel fuel, one pumper firetruck could keep the spent fuel cool until power could be restored. (Of course, if you’re talking no electricity and no diesel fuel, things could get very serious fairly quickly, over days or weeks.)

              What I was arguing with is that loss of coolant circulation to a spent fuel storage facility could result in a nuclear fission “mega-explosion,” rivalling those from nuclear weapons — simply not possible!

            • Fast Eddy says:

              1. There will not be any electricity – there won’t be any diesel – when BAU goes that is the end of all of this

              2. This is FAR worse than a nuclear bomb exploding. We’ve exploding loads of those in testing over the years. When a fuel pond blows it keeps spewing radiation for decades… And there thousands of tonnes of fuel sitting in thousands of fuel ponds.

            • Oh FFS that image is for energy flow predictions for tsunamis, not radiation from Fukushima. Notice it is from NOAA, not anyone that has anything to do with nuclear power.

            • How about, instead of linking BS fringe blogs as sources, you go directly to NOAA, the agency credited right in that image? You’ll notice that someone edited out the text in the bottom right, where it clearly explains the image is for Tsunami energy distribution, and is not an official forecast:

              The correct radiation dispersal thing is from a Google Earth modeling tool. Here’s a clip:

              Of course, it depends on predicted versus observed amounts of radiation flowing into the ocean.

            • Fast Eddy says:

              You are evading the point.

              Which is — that when BAU collapses — spent fuel ponds will explode — and they will unleash massive amounts of radiation, cesium and other death particles onto the planet – and life will be extinguished

              I have supported this assertion with research from top scientists from a range of research papers and articles.

              Yet you will continue to grasp at anything to make yourself feel better about the situation. You may even get angry and defensive when faced with rather damning facts.

              Very much like solar power groupies get angry and defensive when one exposes the fact that solar energy is a joke.

              Just as climate change greenies get upset when you tell them the only way to stop global warming is to collapse the economy because without fossil fuels being burned in massive and increasing amounts growth cannot happen (oh – and they won’t have iphones anymore if that happens – that REALLY upsets them)

              And just like people who stumble upon this blog get angry and defensive when they are told we are out of new sources of cheap to extract oil and civilization is going to end – they get angry, they get defensive, some of them even get hysterical and insulting.

              You are no different than any of the above. And it is not your fault that you cannot see that 1+1=2.

              It is the fault of Mr Cognitive Dissonance. He refuses to let you see the truth. He is protecting you from the truth.

            • “Which is — that when BAU collapses — spent fuel ponds will explode — and they will unleash massive amounts of radiation, cesium and other death particles onto the planet – and life will be extinguished”

              Only if everyone gives up and walks away and leaves the spent fuel ponds completely unattended, or if terrorists blow up the spent fuel ponds causing them to rapidly drain, or meteors fall from the sky and demolish them.

              As long as someone maintains a gravity feed trickle of water, and the steam is allowed to escape, the spent fuel ponds will be fine.

              Your scenario requires that, as soon as the financial system crashes, everyone instantly goes batshit insane and starts mass murdering each other. I am far more confident that we will instead of authoritarian regimes that will do anything necessary to prevent this.

            • Fast Eddy says:

              “As long as someone maintains a gravity feed trickle of water, and the steam is allowed to escape, the spent fuel ponds will be fine.”

              Can you point me to some scientific research that supports this? Or did you just make that up because it makes you feel better about the future?

            • “In order to remove 2.26 megawatts only about one liter of water needs to be evaporated/per
              second. Three months after the accident the Unit 4 spent fuel pool heat
              production decreased to 1.58 megawatts. In order to remove 1.58 megawatts only
              about 0.7 liters of water need to be evaporated/per second. The Alvarez report14
              provides a number of 3 liters/ second based on an earlier analysis done by Sandia
              labs. ”


              You will probably need to manually add the .PDF on the end of the URL, as the blog removes them to protect people from potentially harmful files.

              Most of the original research is classified, and cannot be easily found.

            • Fast Eddy says:

              Can you point me to the part where it says that a spent fuel pond could be maintained without electricity and cooled by a water ram pump?

            • Gary says:

              @Matthew Krajcik May it not be that you don’t believe in the devil view of history! Of course it’s going to be hell on earth!! /end snark

            • Fast Eddy says:

              7 billion people – no food. Try throwing a bone into the middle of a pack of dogs that you have starved for a week and see how bat shit insane they will go.

              We are already going bat shit insane without the collapse – add up all the wars that are currently underway around the world.

              You think that situation is going to improve when things unravel?

              Have a look at this… bat shit crazy MOFs…


              When the electricity shuts off you can attend to the ponds all you like. You can sit there and watch as the water boils off and they explode in your face. And there will be nothing you can do about it.

              Maybe David Copperfield can be called upon to disappear all of these ponds just prior to the collapse of civilization.

              Or hang on – why not just ask David to conjure up an ocean of oil? Or perhaps he could create out of nothing a solar panel tree. And a battery tree.

            • No need, the spent fuel ponds are an excellent source of energy. The Chinese like the idea so much, their going to put all their spent fuel into one giant 200 MW pond and heat and power a city with it. Because why have several small risks, when you can pool them all together into one giant risk?

            • Fast Eddy says:


              It still does not solve the problem of how you manage spent fuel ponds when the global economy has collapsed – and there is no electricity.

            • However did the Romans manage to move water without electricity? What an unsolvable conundrum, I guess we should just curl into a ball and die.

            • Fast Eddy says:

              The Romans didn’t need to keep spent fuel ponds cooled — these are high tech installations – that require electricity to operate

              Curl up in a ball and die? No.

              We all die one way or the other. So does that mean we should have curled up in a ball and died when we were born?

              This knowledge has minimal impact on what I do or think. Because spent fuel or no spent fuel, billions will die when this collapse hits. So the odds are most of us will be dead.

              And life is going to be brutal for those who survive so perhaps the spent fuel ponds will do us the service of putting all of us out of the misery and suffering that is most definitely going to be endured by those who come through the collapse alive.

            • “The Romans didn’t need to keep spent fuel ponds cooled — these are high tech installations – that require electricity to operate”

              I have provided sources from NRC, Westinghouse, Sandia Labs that all show that spent fuel ponds can be managed through water evaporating off, and being passively replaced by gravity feed. The actual reports are classified; you are not authorized to know the truth.

              As close as we non-privileged people can get, indicate that an aqueduct or a water wheel or a couple garden hoses on siphon can simply scoop enough water in to replace the water that evaporates off.

            • Daddio7 says:

              In my younger days I was in the US Navy. I was a machinist mate and we dealt with steam power. I wasn’t on a nuclear powered ship but steam is steam. The problem is used fuel rods are hot right? Wouldn’t the rods still in the reactor core retain enough heat to at least power power plant itself?

            • For sure, even with the control rods in, the reactor cores need constant water circulation because they are many times hotter and closer together with less water and other materials between each rack.

              That’s basically what happened at Fukushima; even with the control rods in, without electricity circulating the water, the water all boiled off, and then from the zirconium cladding the water split into hydrogen and oxygen, and due to all the pipes and walkways and other materials, it was unexpectedly able to detonate rather than deflagrate, causing the roofs to blow off and twisted metal and concrete to fall into the reactors and all over the place, cracking the cement and letting water flow in and out.

              Fresh rods are a much bigger problem then spent ones.

            • Fast Eddy says:

              Being complex systems you’d need a way to maintain the electricity supply, spare parts, keep engineers on site etc etc etc etc etc

              In a collapsed world where there will be no central authority I do not see how any of this can happen.

              There will be total chaos because there will be no energy to allow for any semblance of authority or government

            • Fast Eddy says:

              Yes of course – these should be classified.

              This sort of information is highly sensitive.

              God forbid that the general public should find out that the massive facilities that are storing death could be managed by a water ram, a garden hose, and a nearby stream

              Perhaps Snowden will choose this fascinating topic for his next release of top secret data

            • The reports likely contain information on how exactly one would go about destroying a spent fuel pond, such as in a terrorist attack, what weaknesses there are to exploit, casualty projections and estimates on contamination, etc. If people found out one nuclear power plant in fly-over country could contaminate the entire Mississippi basin from an official source, they’d probably be a little upset.

            • Fast Eddy says:

              Strange – if ‘the terrorists’ wanted to make an impact, why didn’t they fly a plane into a spent fuel pond…. or directly into a nuclear plant itself?

              This is public knowledge: http://belfercenter.hks.harvard.edu/publication/364/radiological_terrorism.html

              There is no reason to classify information that would state that a fuel pond could be cooled using a water ram and a garden house.

              In fact if that was the case. the nuclear industry would make sure that information was on the front page of the NY Times to allay the public’s fears about these monsters.

            • The one non-classified document said two garden hoses. The other said a one-inch pipe. Part of one indicated up to 3 litres per minute of flow needed. Passive gravity feed. Actual amount depends on how recently a rack was added from the reactor. Declines over time quite quickly, as temperatures fall off.

              Interest side note, they mention that leaving old, cool racks in the pools helps in case of an emergency by acting as a heat sink, which is a reason not to empty racks out of the pool as soon as possible.

            • Fast Eddy says:

              I can’t find a spent fuel pond map but generally the ponds are located near the reactors so this is useful (not that anyone will be safe — 4000 ponds left without cooling will explode and radioactive death will billow from them for decades creating a situation far worse than the nuclear winter of an all out nuclear war.

              Nuclear missiles explode once. Fuel ponds are the gifts that keep giving for many many years once they explode.

              McCarthy never specifies what sort of event lead to the death gray skies in The Road… but he alludes to a nuclear catastrophe.


      • I don’t see fraud as being the issue.

        The early estimate of 0.9% growth for Q2 is concerning, especially since it seems to be calculated using reasonable methodology.

        • richard says:

          Mortgage fraud was endemic in the USA prior to 2005 according to the FBI. People and banks calculated that house and commercial property prices would rise on average at five percent forever, and with that their false estimates of income get justified. How is that different to the central banks herding investors into equities and increased margin debt, with forecasts of three or more percent growth forecasts?

  18. Stefeun says:

    A Periodic Table Of Elements That The World Is Running Out Of

    “The paper, published in the Proceedings of the National Academy of Sciences, encapsulates the Yale group’s five-year assessment of the criticality of the planet’s metal resources in the face of rising global demand and the increasing complexity of modern products.

    According to the researchers, criticality depends not only on geological abundance. Other important factors include the potential for finding effective alternatives in production processes, the degree to which ore deposits are geopolitically concentrated, the state of mining technology, regulatory oversight, geopolitical initiatives, regional instabilities, and economic policies.

    In order to assess the state of all metals, researchers developed a methodology that characterizes criticality in three areas: supply risk, environmental implications, and vulnerability to human-imposed supply restrictions.”

    More specifically, 2 articles about Baotou rare earths:
    “Rare earth mining in China: the bleak social and environmental costs
    China produces 85% of global supply of the 17 chemically similar elements crucial to smartphone, camera lens and magnet manufacture – and half that output is from the city of Baotou”

    “The dystopian lake filled by the world’s tech lust”

    Sent from my un-recyclable tablet, which costs of production were externalized onto local (out of sight) communities.

    • Thanks! There is also the issue of the lack of ability to recycle materials that are used in very small quantity, for example in individual smart phones. Even in other applications, ability to recycle is surprisingly low. Suppose that we can get back 70% through recycling–a very favorable ratio. Then after two go-arounds, we are at (70% x 70%) = 49%. After three go arounds we are at (70% x 70% x 70%)= 34%. It isn’t long before we are down to very little. And the energy cost is very high of this recycling, when all of the collection efforts are considered, in addition to the actual recycling. If the material is toxic, there is also the issue of keeping workers in the process out of harms way during the recycling process.

    • Depends on if the system holds together long enough, and if the promises of nanotechnology are possible or just pipe dreams. If we can substitute iron, carbon, silicon and aluminum for rare earths, gold, silver, etc then scarcity will stop being a problem, at least for the raw materials. Whether a new energy source will be available before collapse, we’ll see.

  19. Leo Smith says:

    The Americans, Churchill remarked, can be relied upon to do the right thing…after they have exhausted every other possible alternative.

    I occasionally pop in here to see how that process is developing.

    As an engineer, if you want cheap energy, and the oil ceases to be that, there is but one alternative that actually works. We all know what it is, but of course people are in denial about it, busily exhausting all the alternatives.

    Meanwhile the complex interference of politicians and narrow commercial interests continues to distort the underlying reality of the energy market, making stuff look cheap that isn’t and causing Gail to scratch her head in bewilderment.

    Perhaps we need a new way to distinguish between ‘cheap in real terms’ (high EROEI) and ‘cheap in financial terms’ (hugely subsidised or hugely favoured by regulation).

    Sigh. Never in the field of human idiocy has so much (internet) technology been devoted to giving so many people so much time to talk so much rubbish about a subject they have so little understanding of.

    Keep up the good work Gail. You will get there in the end.

    PS. I am a great fan of history. Having read of the Mayan Empire I was excited to see the Yucatan ruins when I holidayed there. A thought occurred to me: “Whatever happened to the Mayans, to the builders and architects of Chichen Itza: Surely a civilisation that great cannot fall without leaving some trace behind?” And I looked out of my hotel window at a man slowly hand clipping the ornamental hedges ….and realised ‘that is what happened to the Mayans, the leaders, the intelligentsia, the upper classes, the armchair theorists, were destroyed by their belief that false gods would save them: the peasant, in the forest with his maize and his beans, survived’.

    When people inherit a culture and infrastructure that their forebears built, without any idea of how it was maintained, let alone built,they have no hope of actually sustaining it.

    Today we have the extraordinary spectacle of people of the Green persuasion, talking glibly across an energy intensive internet, using high tech media to spread a message, that high tech and energy themselves are bad. They are aware of the problems of technology, but they simply take all of its benefits for granted, to the extent that the man who rides his bicycle round streets built by energy in a town built by energy, in a bicycle built by energy, to a supermarket built by energy where the food he eats has been grown by energy processed by energy packaged by energy and delivered by energy can honestly believe that he has a very small energy footprint!

    You like statistics Gail. How about a graph of energy input per capita versus population density per square kilometre?


    • kulm says:

      These green people will tend the gardens of the 0.01%, who will join cat 1 civilization and become superhumans and abandon their feeders, like the pilgrims who forgot Squanto who taught them how to farm maize.

    • Tolstoy's Degenerate Grandson says:

      let me guess – nuclear energy?

      Nuclear is Expensive

      In 1954, then Chairman of the Atomic Energy Commission Lewis Strauss promised that the nuclear industry would one day provide energy “too cheap to meter.”(5) More than 50 years and tens of billions of dollars in federal subsidies later, nuclear power remains prohibitively expensive. Even among the business and financial communities, it is widely accepted that nuclear power would not be economically viable without government support.(11) Despite this poor economic performance, the federal government has continued to pour money into the nuclear industry the Energy Policy Act of 2005 included more than $13 billion in production subsidies, tax breaks and other incentives for nuclear power.

      The most important subsidy for the nuclear industry and the most expensive for U.S. taxpayers comes in the form of loan guarantees, which are promises that taxpayers will bail out the nuclear utilities by paying back their loans when the projects fail. According to the Congressional Budget Office, the failure rate for nuclear projects is “very high well above 50 percent.”(12) The nuclear industry is demanding $122 billion in federal loan guarantees for 21 reactors. If these guarantees were authorized, taxpayers would be on the hook for at least $61 billion.


      Nuclear Power Cost – Nuclear power is an increasingly expensive source of energy.

      n the dawn of the nuclear era, cost was expected to be one of the technology’s advantages, not one of its drawbacks. The first chairman of the Atomic Energy Commission, Lewis Strauss, predicted in a 1954 speech that nuclear power would someday make electricity “too cheap to meter.”

      A half century later, we have learned that nuclear power is, instead, too expensive to finance.

      The first generation of nuclear power plants proved so costly to build that half of them were abandoned during construction. Those that were completed saw huge cost overruns, which were passed on to utility customers in the form of rate increases. By 1985, Forbes had labeled U.S. nuclear power “the largest managerial disaster in business history.”

      The industry has failed to prove that things will be different this time around: soaring, uncertain costs continue to plague nuclear power in the 21st century. Between 2002 and 2008, for example, cost estimates for new nuclear plant construction rose from between $2 billion and $4 billion per unit to $9 billion per unit, according to a 2009 UCS report, while experience with new construction in Europe has seen costs continue to soar.


    • Glenn Stehle says:

      As an engineer, if you want cheap energy, and the oil ceases to be that, there is but one alternative that actually works. We all know what it is…

      So what is this elixir that will solve all our energy needs?

      And I looked out of my hotel window at a man slowly hand clipping the ornamental hedges ….and realised ‘that is what happened to the Mayans, the leaders, the intelligentsia, the upper classes, the armchair theorists, were destroyed by their belief that false gods would save them: the peasant, in the forest with his maize and his beans, survived’.

      It sounds like you’ve fallen under the influence of Frida Kahlo, Diego Rivera and like-minded intellectuals. And I suppose this is an easy thing to do in a secular world where materialism is the alpha and the omega of human existence. Present-day orthodox economists, after all, are every bit as materialistic as 20th-century Marxists were.

      But a great deal of recent scholarship is now debunking the Kahlo and Rivera version of history.

      Kahlo and Rivera turned away from the patently hierarchical societies of central and southern Mexico, training their sights instead on western Mexico. Here, in the earthenware vessels created by its ancient inhabitants, they thought they had found evidence that confirmed the existence of their sought-after Rousseauian, and purely secular, Shangri La. As Richard F. Townsend explains in Ancient West Mexico, it was the

      warm, expressive appeal that made these earthenware figures so attractive to the artists and intellectuals of the Left who found them to be ideologically significant because they seemed to speak of an ideal, communal way of life, far from the regimented coercion and economic exploitation of warlike fascist or imperialistic states….

      The figures accompanying the deceased in West Mexican mortuary art were taken as purely secular and “anecdotal,” representing ordinary, everyday life and hence lacking symbolic significance….

      Even Miguel Covarrubias, ordinarily one of the most astute students of pre-Columbian art, fell into that trap, insisting, in 1957, that there were simply no sacred or “supernatural” themes in West Mexican mortuary art at all. In his classic work ‘Indian Art of Mexico and Central America,’ these effigies and other ceramics were described as being purely “realistic and anecdotal, concentrated in minute and detailed representations of the fauna and flora, the family life, occupations, and ceremonies of their makers, without trace of religous or symboliic concepts.”

      But more recent scholarship has shattered this imagined past paradise of the secular materialists. As Townsend goes on to explain:

      But the fundamental change in the archaeological picture of West Mexico began to take shape in the 1970s… [Reasearchers] realized that the long-held view of West Mexico as a backwater “village farming” or “eternal formative” cultural region was due for major transition….

      Only in the past fifteen years has archaeology broadened from a concentration on ecology and economy to consider evidence leading toward the domain of “ideology” and the functions of religious activity and symbolic systems in the formation and maintenance of ancient societies….

      Today, a hundred years after the travels of Breton and Lumholtz, it is clear that aboriginal communities in West Mexico gave rise to high socioeconomic, symbolic, and aesthetic achievement with distinctive, even singular features. The availability, management, and control of natural resources were certainly determining factors in the formation and development of ancient communities; but it is no less important to recognize that such a complex adaptive human experience is never simply an outcome of economic activity or utilitarian purposes.

  20. Kulm says:

    I do see that eventually the world will be like a bunch of Singapores and the rest.

    In the “Singapores”, the very wealthy and the essential people will live in almost draconian control, protected from the masses by drones and their food farmed by machines using state of art techs.

    Singapore has perhaps 5.4 million, not counting the laborers who are not considered humans, in less than 300 sq miles. To feed the 5.4 million, I would think no more than 3,000 sq miles are needed.

    Singapore is a private kingdom of the late Lee Kuan Yew and his family, who are naturally the richest people in there since they control all of Singapore’s money. Anyone who do not like the Lee clan is quietly, mercilessly and effectively expelled from the island kingdom. So the people who are there all worship the Lee clan as gods, and in return are guaranteed a very high standard of living.

    The late Harry Lee (Yew’s birth name) was a champion of sorts by the Dark Enlightenmenters, who actually created their paradise and got to rule over it.

    Several key locations, like San Francisco, Silicon valley, New York, some posh Florida communities will be the stronghold of the People Who Do Matter Economically, who will not exceed 100 million total. The energy footprint of these Cat 1 civilization residents will be much smaller than now, ensuring the current system will go for at least 1,000 more years.

    The rest, locked out of “Paradises”, will be reduced to the level of the rioters in Baltimore now.

    • Tolstoy's Degenerate Grandson says:

      There will be no energy therefore there will be nothing even remotely resembling what you are suggesting.

      This is total nonsense

      • Glenn Stehle says:

        I agree. It is total nonsense. There are already growing signs that there is trouble in paradise (see video documentary on Singapore below).

        But I suppose everyone needs their own escape, their own fantasy custom tailored to fit their own individual tastes and predilections. As you said up the thread:

        But for most people it is best not to allow this thought [factual reality] to fester because it would lead to deep depression and perhaps suicide.

        Better a shovel and a hoe for therapy than a mouthful of xanax each day.

        But one must keep open the possiblity that we doomers are just as deluded as everyone else. As Nietzsche was want to demonstrate, this seems to be the human condition.

      • Glenn Stehle says:

        Tolstoy, I agree. It is total nonsense.

        There is aready growing evidence that there is trouble in paradise:

  21. Glenn Stehle says:

    It looks like the drought in California may be exacerbating social strife, driving a wedge between the haves and the have-nots.

    The state has recommended an incremental rate plan for water customers. High-use customers pay significantly higher rates in the new stair-stepped plan.

    The high rates are hitting affluent areas the hardest, such as Cowan Heights. As the NY Times reports ,

    The daily water consumption rate was 572.4 gallons per person in Cowan Heights from July through September 2014, the hot and dry summer months California used to calculate community-by-community water rationing orders; it was 63.6 gallons per person in Compton during that same period.

    But the gentry of Cowan Heights is not taking it laying down. The beautiful people have sallied forth from their multi-million dollar mansions and are hitting the streets in protest. The smart set has created its own web page to mobilize against the “water rip off.”.


    • It seems they may have a legitimate complaint:
      “Public water agencies cannot sell water, a necessity of life, profit, due to Proposition 218 passing in 1996, which provides that revenues from the property related fee “shall not exceed the funds required to provide service.” and “shall not exceed the proportional cost of service attributable to the parcel.” Public agencies cannot profit from the sale of water.”

      So tiered billing is okay, but they pay 2 to 4 times as much for water since their water is supplied by a for-profit company, which appears to be illegal.

    • kulm says:

      it is not silicon valley. irrelevant.

      los angeles is doomed. but its disapperance will not be missed by the people who do matter.

  22. Pingback: Will the next big crash be the last one? | P2P Foundation

  23. Stefeun says:

    looks like you’ve left China just in time:
    “‘Sand-ageddon’: Chinese capital hit by worst sand storm in decade”

    • Thanks! Glad I wasn’t there. Beijing is near a desert area, which makes it vulnerable to these sand storms.

      • Olsen says:

        Gail, will you be able to go to Cuba?
        The Bovine, Russia’s Private Garden Plot Act, which was signed into law back in 2003,entitles every Russian citizen to a private plot of land, free of charge, ranging in size from 2.2 acres to 6.8 acres. Each plot can be used for growing food, or for simply vacationing or relaxing, and the government has agreed not to tax this land. And the result of this effort has been phenomenal, as Russian families collectively grow practically all the food they need.

        • Artleads says:

          The Russian story sounds almost too good to be true.

          • Kulm says:

            It is. Few people actually take advantage of it since they don’t like farming.

            • Jan Steinman says:

              Few people actually take advantage of it since they don’t like farming.

              Not according to several sources I’ve heard.

              In particular, I think Dmitry Orlov notes the “dacha garden” phenomonen in his comparison of Russion and US collapse scenarios. I’ve also seen a presentation by the translator of the “Anastasia” series of books that alleges that 45% of Russia’s food comes from just 17% of the land, all from dacha gardens.

              So yea, not everyone takes advantage. But it seems that an amazing proportion do. Orlov makes a good case that Russia is much more resilient than the US, with individual food production being one of the key factors.

        • Yes, I will be in Cuba May 10 to 18. I am sure my internet access will be virtually zero during that time. I am told that for a high fee, I can use the Internet in the lobby of some hotels, if it happens to be working.

          • Tolstoy's Degenerate Grandson says:

            My recollection of internet in Cuba was that it was available in the rooms of some hotels. It was pricey but not outrageous, perhaps $20 for a 6 hour access card. If you are logging on and off you can use the card for many days (it’s not a straight 6 hours from the first log on).

            • My impression is that conditions in Cuba have gone downhill in recent years. In fact, that may be a reason for the warming relations with the US. Cuban population seems to be rising (a little), while energy use is flat to down a bit. I will have to see when I get there.

            • Don Stewart says:

              Things are not good on several Carribean islands. Puerto Rico is flirting with bankruptcy. Jamaica is getting an IMF bailout. The former leader of Jamaica says it has no industry left to generate the money to pay off any loans.

              Don Stewart

  24. Mike says:

    I think they understand and certainly they know about it where they fail is believing they can control the outcome. Like setting a preventive fire and finally burning the entire forest because it went out of control.

    • Tolstoy's Degenerate Grandson says:

      Mike – I do not think they believe this will end any way but badly.

      The PTB have all the numbers that we don’t have – and they would know that all they are capable of doing is delaying the inevitable.

      I do not imagine that anyone in power thinks that money printing and bidding up the stock market with interest free money will fix anything.

      Didn’t Bernanke basically say that in code when he stepped down when he stated to the effect ‘I know a lot of people hate me but when they eventually see why I did what I did they will understand – and thank me’

      I interpret that as ‘I bought you 6 years of life with QE, hopefully more. When the policies I initiated fail to hold back the deluge, and you are starving by the billions, you will understand what I was fighting, and you will thank me’

  25. kulm says:

    The world will be much less finite with the marginalization of the middle class into irrevalence.

    The Dark Enlightenmenters actually think feudalism and concentration of wealth into a few people will bring the ones at the top into the brave new world, and the masses, barely subsisting, will be eventually written out from evolution.

    • Artleads says:

      Isn’t this why the masses should get together and start building sustainable systems for survival? And if this is done won’t those “Dark Enlightenmenters” not grow irrelevant, or at least less powerful?

      • kulm says:

        Whatever the masses will do will be as relevant as the Amish and the Hutterites.They might be left alone but completely irrevalent, and woukd probably treated like the untouchables of india.

        These elites reside in a civ far more advanced, and wield far more power than the masses. it will be impossible for the masses to react. The drones will prevent any kind of unified effort.

      • Jan Steinman says:

        Isn’t this why the masses should get together and start building sustainable systems for survival?

        I’ve been trying to do that for ten years! Lotta lookers, no tookers.

        Typical scenario: someone comes and gets all excited and wants to cast their lot together. Then they notice that, well, we’re making furblesnotzers, and gee, they could never live in a place that made furblesnotzers!

        Another excuse to run away is the “too much risk” feint. Their precious $WHATEVER is all they have, and they can’t guarantee that their contribution would “save the project,” so they run away. Well hey, I have all my precious $WHATEVER in, so I’m haven’t let it fail for nearly ten years now!

        Generally, people are more in love with the idea of taking action than with actually, y’know, taking action. When all is said and done, more will have been said than done.

        So the “masses” are fiddling while Rome burns. I see boiling frogs everywhere. Things just aren’t bad enough for people to stick their neck out. But when it gets bad enough, it will be too late.

        • Gary says:

          Being new to limits to growth, the likelihood (questionable?) of the collapse of the global economy, sustainability/ permaculture (while the ideas of walking the walk instead of just talking the talk… and action in addition to knowledge… are old and wise ideas… incontrovertible truths actually), where would you suggest one begin to (1) act and (2) invest, i.e. emotionally and with one’s life savings?

          • Jan Steinman says:

            where would you suggest one begin to (1) act and (2) invest, i.e. emotionally and with one’s life savings?

            [shameless self-promotion mode]You might consider what we’re doing. We could use some help![/shameless self-promotion mode]

            The futility of being 100% prepared (an impossibility, anyway) is the main thing that keeps people from acting, in my opinion. People (including perhaps a few here) get stuck in “analysis paralysis,” and then fail to have anything to show for it, save for some scribbles on paper or thoughts in the back of the head.

            Do something, almost anything, NOW!

            Then step back, see how it worked, adjust, and then do something else!

            What is this “something” that one should do? It could be almost anything that fits with your broad goals. Learning to grow food is always a good start, but as edpell noted, it may not be for everyone. Take up a simple skill, craft, or trade, as another example — one that does not require complicated machinery or electronics. Learn to sew. Learn carpentry. Learn food preservation and artisanal food crafting. Learn soap making. Learn teaching these things to others. Learn all of these to some extent, while focusing on one. David Holmgren says, “A Permaculturalist should be a jack of all trades, and a master of one.”

            Best of all, learn how to collaborate. Our hierarchical system of governance and business imposes collaboration from above, and many people (if not most people) become very self-centered when hierarchy disappears. As Kipling noted, if you can keep your head while others are losing their and blaming it on you, you’ll go far in the new future.

            Emotional investment: a big topic. What is your passion? If in a complex field, can it be simplified? If you love computer programming, could you be happy documenting farming procedures, for example? (“Programming new farmers!”)

            You’re gonna make mistakes. Make them now while there’s enough extra energy to be forgiving of mistakes. Then learn from them.

            • Gary says:

              Thank you. The self promotion was fine. I checked out your website after posting my question. But the additional personal information was very welcome also. Changes in the air… how to prepare?

            • pintada says:

              Near 7 figures would retire your debt? Holy “sustainability” batman!!

              Where will you live after the bank takes possession?

          • Don Stewart says:

            My two cents worth. If you have any land at all, or have access to land, try beautifying it with edibles.


            This fellow saw what my friend Deb Tolman was doing in central Texas, on very poor and rocky soil, and started a business selling these kits. You can see for yourself that one can grow an awful lot of food in a very small space. As a rule, these are self-watering and self-fertilizing, because you keep adding kitchen scraps to a basket in the center and you keep adding carbon material as the soil sinks due to microbial activity. I think you will gain increasing confidence in your abilities. You can branch out into seed saving and stuff like that if the spirit moves you.

            I will note that these kits are designed to be pleasing in a suburban or urban setting. If you are living in a rural setting, the walls can be constructed from almost anything. Deb Tolman just built one out of wine bottles that she rescues.

            Don Stewart

            • Gary says:


            • edpell says:

              Wine bottle rescue LOL

            • Olsen says:

              The Bovine, Russia’s Private Garden Plot Act, which was signed into law back in 2003,entitles every Russian citizen to a private plot of land, free of charge, ranging in size from 2.2 acres to 6.8 acres. Each plot can be used for growing food, or for simply vacationing or relaxing, and the government has agreed not to tax this land. And the result of this effort has been phenomenal, as Russian families collectively grow practically all the food they need.

          • Artleads says:

            The simpler you can make things, the better. I live in a village of 300 souls. This number hovers around a very ancient community-size model. Hunter gatherer bands were rarely larger than 200. This model can be largely grafted into civilized society.

            My entire village stands at 300, comprising what I call a “pod.” Similar-size pods can occur anywhere–a suburban neighborhood, a city block, one floor of a mega apartment in a mega city. Optimizing what everyone can do to make for a pleasanter, more resilient pod community is the idea.

            In pods where there is land–typically, backyards–some form of proto agricultural activity is absolutely a no-brainer.

            – Put all food scraps and yard clippings on the earth

            – Cover the food scraps with the yard clippings (or cardboard from the store) to keep critters away. Dug-up yard earth, store-bought topsoil, horse manure, depending on what is convenient and affordable, can also cover each deposit of food waste.

            – Lead a garden hose to the pile and water. Or, better, lead your kitchen sink gray water outlet to the pile. That will help it to break down and form compost.

            – The water can be redirected as new piles are formed. Where feasible, some piles can be left covered but unwatered, and they will compost more slowly. (I use my leach field for this type of no water composting.)

            This disposes of your food waste while building rich soil. This is about as effortless as it gets. If you have piles of compost on your property, you can use it to nourish trees. You can sell it or give it away. Or you can use it to grow food. It is not magical. It may well be messy and feel like getting nowhere, but it can’t help but make for better land management than if you put your food waste in the dumpster and send your gray water to the sewer.

            If you live in the city with no available land, you can start seedlings on the window sill. I understand that sprouts will grow there too, and that they are most nourishing. Seedling grown that way can be traded with pods that have land and food to exchange with you.

            None of this is enough. But if we don’t do (en masse) what we can for ourselves, we can’t expect more powerful forces to help us. They will only help us when they see that we’re serious about helping ourselves too.

        • Olsen says:

          The Bovine, Russia’s Private Garden Plot Act, which was signed into law back in 2003,entitles every Russian citizen to a private plot of land, free of charge, ranging in size from 2.2 acres to 6.8 acres. Each plot can be used for growing food, or for simply vacationing or relaxing, and the government has agreed not to tax this land. And the result of this effort has been phenomenal, as Russian families collectively grow practically all the food they need.

  26. Kulm says:

    With the collapse of middle class in Western countries, the energy footprint of the major nations will significantly contract. The 8 million people who own more than half of the world will have a considerably smaller energy footprint. They can only enjoy so many private aircrafts a day.

    That’s how BAU will survive.

  27. Kulm says:

    BAU will not die

    >Autopilot Nation & The Winner Take all Economy

    >The ‘autopilot nation’ is part of the greater economic moderation and what Steven Pinker calls ‘the long peace’. As much as the left wishes it weren’t so, the world is becoming less violent, thanks in part to innovation, free markets, and the spread of American-style capitalism around the world. The left seeks civil war (rich vs. poor) and economic crisis so that the rich lose money and society can be rebuilt in their image, similar to the October Revolution, French Revolution, The Great Depression and much later, 2008.

    >As Russia, EU, Japan and Australia struggle with sluggish growth, thanks to the success of the much-hated bank bailouts, effective fed policy, the strong US consumer, free markets, and unstoppable technological innovation, America’s economy been in an autopilot Goldilocks economy since 2009, but Obama deserves no credit for it. (Snip)

    >America is becoming successistan, iqistan and richistan. To get an idea of how important IQ, wealth and success has become in the hyper-competitive, winner-take-all post-2008 economy, the most popular Reddit Ask Me Anything is by a man who epitomizes all the three of the aforementioned qualities – Elon Musk. It has gotten over 10,000 comments – much more than any celebrity. Recall in 2013 the increasingly irrelevant liberal Rag, the New York Times, tried, with much desperation and futility, to defame Tesla and Elon Musk in an editorial where avowed liberal auto reviewer, John M Broder, deliberately ran his test Tesla out of electricity in order to write a bad review. Tesla stock was trading at $40 at the time; it’s now at $210, to the chagrin of the liberals who wanted to see Tesla fail, and another defeat for the wealth spreading left in their war on success and capitalism.(snip)

    >People are falling behind because of low IQs and the winner-take-all economy that showers great riches upon some and not much for everyone else. Today’s hyper-meritocracy is amplifying the socioeconomic ramifications of individual cognitive differences such that a person with an IQ >110 is much more likely to succeed than someone with an IQ The autopilot economy and do-nothing congress means those at the top – the smarties – have little to fear from those at the bottom, as much as the left yearns for class revolution. There won’t be rioters with pitchforks, and if there are, the militarized police will put them down with ease. The Greater Moderation and The Long Peace will continue unimpeded for many more decades to come.

    BAU will continue, although population will decline without most in the First World even noticing.

    • Jan Steinman says:

      This article (at least, the quoted bits) implies that a meritocracy exists.

      I don’t really think IQ has much to do with anything. It certainly is not a prerequisite for leadership — witness Ronald Reagan, GW Bush, Dan Quayle, and the tea-partiers in Congress these days.

      • Kulm says:

        The guy I like to quote from, Gray Enlightenment, uses “IQ” as an euphemism as the ‘ability to make money in today’s world’.

        • Jan Steinman says:

          the ‘ability to make money in today’s world’

          I think you need to add “inherit” to that definition.

          In GW Bush’s case — as Molly Ivins told it — he was “born on third base, and thought he hit a triple.”

          He sorta muddled around with his daddy’s oil business, and dabbled in pro sports, but basically didn’t have a thing going for him except for ancestors.

          Without his family, I dare say he would have been sleeping off benders behind a stack of boxes in some factory job.

          Money is like sex: if your parents didn’t have it, chances are you won’t have it, either.

          • Kulm says:

            That is probably true. This guy who originally wrote this recognizes that. But throughout the history there have been always royalty, and they tend to marry very well.

            Laura Bush and the daughters seem to be brighter than GWB so the clan is safe, unlike virtually every poster in this blog.

      • Kulm says:

        That guy does not believe in Black Swan, Nassim N. taleb, etc.

        He believes the rules of game changed on 2008 .

        He believes the Cat 1 stage of civilization, nuclear fusion, singularity, etc will arrive although most of the rest will not be allowed to enjoy these.

        • Gary says:

          I’m not sure which “guy” you are referring to… the author of the blog I linked to or Pinker… but I realize that the real argument is the statistical robustness of Pinker’s “Long Peace.” I assume that Taleb has the better understanding of how statistics can describe reality than Linked, an experimental psychologist, … but I assume that my assumption is mere opinion compared to the heavy weights with skin in the game.

          • Kulm says:

            The guy, Gray Enlightenment (about whom nothing is known), whose writing I copied over.

            He does not believe in theories – he only sees how the numbers are now.

            • Gary says:

              OK. Thanks for the clarification. I wish I had the smarts to intelligently interpret and argue the numbers.

            • Gary says:

              It’s questionable that “the numbers” really indicate Pinker’s Long Peace. As for BAU and AI (the “singularity” to which you refer I assume), the future is being/becoming less ill-defined via modeling… at least that’s the attempt. GIGO (optimistic v pessimistic motivated reasoning) is my assumption when attempting to interpret the numbers. If it were Gray Enlightenment v Nassim N Taleb… what makes who more credible? A more convincing modeler? How does one discern?

            • Kulm says:

              That guy says Nassim Taleb’s black swan event never occured and the world (the BAU ) just muddles along like an autopilot, for a very long time , presumably till mankind reaches Cat 1 civilization which simply formats the whole human situation.

    • Glenn Stehle says:

      The ‘autopilot nation’ is part of the greater economic moderation and what Steven Pinker calls ‘the long peace’. As much as the left wishes it weren’t so, the world is becoming less violent, thanks in part to innovation, free markets, and the spread of American-style capitalism around the world.

      Oh really? Well I suppose in Pinker’s defactualized world, anything is possibe.

      This optimistic theme coincides with the 2009 Nobel Peace Prize laureate’s ongoing wars on at least four continents (Asia, Africa, Europe, and South America) and the US military’s spread to more than eight hundred bases worldwide; the US-led NATO bloc’s rapid post-Soviet growth and proclamation of “out-of-area” responsibilities; and the United States’ declaration of a right to kill its “enemies” anywhere on the planet….

      How does Pinker get around the seemingly large numbers of wars and militarization process that bother so many ordinary people and specialist observers such as Chalmers Johnson, Andrew Bacevich, and Winslow Wheeler? One Pinker method is to confine his focus to post-1945 wars among the great democracies, which have not fought one another in this sixty-seven-year interim, and to ignore or downplay the numerous wars that the great democracies have fought in the Third World. He calls this the “Long Peace,” while the other wars have no name. Pinker contends not only that the “democracies avoid disputes with each other,” but that they “tend to stay out of disputes across the board,” an idea he refers to as the “Democratic Peace.” This will surely come as a surprise to the many victims of US assassinations, sanctions, subversions, bombings, and invasions since 1945. For Pinker, no attack on a lesser power by one or more of the great democracies counts as a real war or confutes the “Democratic Peace,” no matter how many people die….

      Nowhere does Pinker mention the massive US use of chemical warfare in Vietnam (1961–70), and the estimated “three million Vietnamese, including 500,000 children, . . . suffering from the effects of toxic chemicals” used during this ugly and very un-angelic form of warfare.2 What makes this suppression especially interesting is that Pinker cites the outlawing and non-use of chemical and biological weapons as evidence of the new evolving higher morality and decline of violence, so his dodging of the facts on the massive use of such weapons in Operation Ranch Hand and other US programs in Vietnam is remarkably dishonest…

      Pinker completely ignores the phenomenon of structural violence, or the kind of violence that is “built into the structure” of social relations, and “shows up as unequal power and consequently as unequal life chances,” in Johan Galtung’s famous rendering. On a planet with more than 7 billion people facing mounting ecological pressures, the increasingly savage global class war of the 1% against the other 99, and the “endemic undernutrition and deprivation” that afflicts billions of people even in “normal” times—to extend Amartya Sen and Jean Drèze’s writings on India to the world as a whole—takes a toll every day that overshadows the violence of war.

      Steven Pinker’s Better Angels is terrible as a work of scholarship and as a guide to the real world. But it is an outstanding snow job, with over a hundred figures, a great many footnotes, and a flood of assured words and arguments that require a certain amount of work to understand. That its positive message, so well geared to the demands and drift of Western imperialism, would be well received in establishment circles is perfectly understandable. Less so is its uncritical treatment by so many people who should know better.

      Steven Pinker on the alleged decline of violence

      • Gary says:

        Begin snark: If you don’t like Pinker, maybe Matt Ridley (of The Rational Optimist infamy) is more credible. /s

      • Kulm says:

        During the Napoleonic Wars, the ones doing the dying were mostly the hapless conscripts. The nobles, at least those not in danger of being arrested, still went around the Continent.

        For people like Pinker and the Dark Enlightenment, whatever happens in the ‘boondocks’ do not really matter. As long as their own neighborhood is not under fire and they do not suffer any inconveniences from a war, that is peace enough for them.

    • Glenn Stehle says:

      As Russia, EU, Japan and Australia struggle with sluggish growth, thanks to the success of the much-hated bank bailouts, effective fed policy, the strong US consumer, free markets, and unstoppable technological innovation, America’s economy been in an autopilot Goldilocks economy since 2009….

      From Forbes:


      Obama has an approval rating of 40% and Putin 85%.

      Do we need to ask why? Not only has Russia enjoyed superior GDP growth, but its being shared more evenly:



      • Kulm says:

        Russia can collapse within a week if America and the West make a decision.

        The only reason it is not done is because it will make China own all of Siberia, which is even worse and possibly a game changer for the BAU.

    • Glenn Stehle says:

      America is becoming successistan, iqistan and richistan. To get an idea of how important IQ, wealth and success has become in the hyper-competitive, winner-take-all post-2008 economy, the most popular Reddit Ask Me Anything is by a man who epitomizes all the three of the aforementioned qualities – Elon Musk.

      What planet this guy live on? It surely isn’t planet Earth.

      Not surprisingly, the speculative mania on Wall Street has reached such absurd lengths that Telsa is being heralded and valued as the second coming of Apple and its circus barker CEO, Elon Musk, as the next Henry Ford. Indeed, so raptured were the day traders and gamblers that in the short span of 33 months between early 2012 and September 2014 they ramped up Tesla’s market cap from $2.5 billion to a peak of $35 billion.

      That’s a 14X gain in virtually no time—-and its not due to the invention of a revolutionary new product like the i-Pad. Instead, we’re talking about 4,600 pounds of sheet metal, plastic, rubber and glass equipped with an electric battery power pack that has been around for decades, and which is not remotely economic without deep government subsidies.

      Beyond that, the various Tesla models currently on the market carry price tags of $75k to more than $100k. So they are essentially vanity toys for the wealthy—–a form of conspicuous consumption for the “all things green” crowd.

      But notwithstanding all the hype on Wall Street, there was nothing remotely evident in its financials that justified Telsa’s $35 billion peak market cap. Net sales for the LTM period ended in September amounted to $2.9 billion, meaning that speculators were putting a silicon valley style multiple of 12X sales on a 100-year old industrial product; and one sold by a fly-by-night company distinguished from its auto company peers, which trade at 0.5X sales, only by marketing hype and a high cost power plant that could be made by any of two dozen global car companies if there was actually a mass market demand for it.

      Needless to say, Tesla’s meager LTM sales were not accompanied by any sign of profits or positive cash flow. September’s LTM net income clocked in at negative $200 million, and operating cash flow of $150 million was dwarfed by CapEx of $700 million.

      Unless you are imbibing in the hallucination-inducing Cool Aid dispensed by Goldman Sachs, which took this red-ink machine public in 2009 and has milked it via underwritings, advisories and early stage investments for billions, Tesla’s valuation was patently absurd. Yet the gamblers piled-in based on the utterly improbable assumption that oil would remain at $115 per barrel for ever; that a mass market for electric battery autos would soon develop; and that none of the powerhouse marketing and engineering companies like BMW, Toyota or even Ford would contest Tesla for market share at standard industry profit margins.

      The truth is, there is massive excess capacity in the global auto industry owing to government subsidies and bailouts and to union protectionism that keep uncompetitive capacity alive; and that chronic condition is now especially pronounced due to the wildly soaring growth of unused production capacity in China. This means that the global economy is literally saturated with expert resources for auto engineering, design, assembly, machining and component supply.

      Consequently, if a mass market were to develop for battery powered vehicles these incumbent industry resources would literally swarm into Tesla’s backyard. So doing, they would eventually drive margins to normal levels, sending Elon Musk’s razzmatazz up in the same cloud of smoke that has afflicted many of his vehicles.

      These is no reason to think that any long-term mass market player in the auto industry could beat Toyota’s sustained performance metrics. In the most recent period, its net profits amounted to 7.5% of sales and it traded at 11X LTM net income. So even if you take as granted the far-fetched notion that in a world of $2-3 per gallon gasoline——-which is likely here for a sustained duration—-that a mass market will develop for electric battery vehicles, Telsa would still need upwards of $50 billion of sales at Toyota profit rates and valuation multiples to justify last September’s peak market cap.

      So let’s see. Tesla’ CY 2014 sales totaled $3.2 billion, meaning that you would need to bet on a 16X gain in sales over the next few years and that today’s rag tag start-up manufacturing operation could achieve levels of efficiency, quality and reliability that it has taken Toyota 60 years to perfect. Yet take one hard look at Tesla’s historical financials and it is blindingly evident that there is no reason for such an assumption whatsoever.

      In fact, Tesla is not a Toyota in the making; it is a Wall Street scam in plain sight. It has been a public filer for seven years now, and here are the horrific figures from its financial statements.

      Since 2007 it has booked cumulative sales of just $6.1 billion, and that ain’t much in autoland; it amounts to about one week of sales by Toyota and two weeks by Ford. Its cumulative bottom line has been a net loss of $1.4 billion, and the losses are not shrinking—-having totaled nearly $300 million for 2014 alone.

      More significantly, during its entire seven years as a public filer, Tesla has failed to generate any net operating cash flow (OCF) at all, and has, in fact, posted red ink of $500 million on the OCF line. During the same 7-year span ending in Q4 of 2014, its CapEx amounted to a cumulative $ 1.8 billion.

      So go figure. Combining OCF and CapEx you get a balance sheet hemorrhage of nearly $2.4 billion. The real question, therefore, is not why Tesla was worth $35 billion, but why it wasn’t bankrupt long ago?

      The answer is that it was and should be now. Tesla would not have even made it to its Goldman-led IPO without a $500 million bailout by Uncle Sam. That the hard-pressed taxpayers of America were called upon to underwrite a vanity toy for the wealthy—–and one peddled by a serial milker of the public teat—is surely a measure of how deep crony capitalist corruption has penetrated into the business system of America.

      But even these egregious windfalls do not begin to compare with the gifts showered on Elon Musk by the money printers in the Eccles building. Tesla has stayed alive only because it has been able to raise billions of convertible debt in the Wall Street casino at yields which are the next best thing to free money. In short, it has been burning massive dollops of cash for years and replenishing itself periodically in capital markets which are rife with momo speculators flying high on cheap carry trades and the Fed’s buy-the-dip safety net.

      During the spring of 2014, for instance, it raised $2.3 billion of 5- and 7-year money at interest rates ranging between 25bps and 125bps. That’s right. This company is a red ink spewing rank speculation, but the money printers have enabled it to raise cash that costs virtually nothing on an after tax basis. Call it free money for the Telsa bonfire of the vanities.

      True enough, these miniscule interest rates were attached to convertible bonds—-so supposedly the “upside” justified giving a proven red ink machine free money. Yes, and the strike price on those converts implied a market cap of about $50 billion!

      In truth, Tesla’s true losses are even greater than its accounting statements suggests. For instance, it has booked upwards of $500 million of revenue and profits owing to ZEV (zero emissions vehicle) credits. The latter were invented by Al Gore after he finished inventing the internet, and amount to nothing more than bottled air—-clean or not.

      Also, Tesla’s affluent customers pocket about $10,000 per vehicle of Federal and state tax credits, meaning that taxpayers have fronted another $500 million or so to stimulate Tesla sales.

      Finally, Tesla’s marketing machine has even converted itself into a repo man for the wealthy. That is, Tesla guarantees a large share of its customers that it will buy back their vehicles at no loss after three years.

      So how does it possibly make a profit deploying this blatant free rent-a-car gimmick? Ask its accountants. In their wisdom and clairvoyance, they have undoubtedly assumed that the residual value of these vehicles will be levitated by the same juice which fuels Tesla’s stock price.

      Yes, Tesla is a bonfire of the vanities. In due course, the bubble will collapse and billions will have been wasted—-much of it with taxpayer money—on things like its imaginary gigafactory in Nevada. But that’s what happens when central bankers destroy honest price discovery and turn capital markets into a gambling casino.

      Tesla: Bonfire Of The Money Printers’ Vanities

      • edpell says:

        No, no, say its not true Glenn. Here in New York we are counting on the solar panel gigafactory to restore blighted Buffalo, New York. It magically converts the uneducated into highly paid knowledge workers.

        Of course the knowledge workers for the Global Foundries gigafactory in Malta, New York sit in Santa Clara, California. Only the robots sit in New York with its bad weather and lack of alternative jobs.

      • Kulm says:

        That’s a perfect example of how the game changed.

        Elon Musk will NEVER be poor, NEVER will be held accountable for anything. etc. If it fails he will have NO trouble assembling a bunch of very wealthy backers for the next venture.

    • Glenn Stehle says:

      People are falling behind because of low IQs and the winner-take-all economy that showers great riches upon some and not much for everyone else. Today’s hyper-meritocracy is amplifying the socioeconomic ramifications of individual cognitive differences such that a person with an IQ >110 is much more likely to succeed than someone with an IQ…

      The relation between IQ and wealth is all over the map. This suggests that meritocracy is not at work in who owns yachts and has deep investment portfolios.


      From Zagorsky, Jay. 2007. Do you have to be smart to be rich? The impact of IQ on wealth, income and financial distress. Intelligence 35: 489-501.

  28. Julian Brown says:

    richard, thanks for that.
    Adam Smith was a clear-thinking and straight-talking genius who makes the current crop of economists look like the blithering cretins they really are.
    One proof of why economics can hardly be regarded as a respectable science, like physics, is because its first modern practitioner was its greatest and the second practitioner (Ricardo) was arguably the second greatest. It has been all downhill from there……

  29. Julian Brown says:

    you are not alone in your judgement of Tesla. See:
    As to your many other observations: I fear you are quite correct. Fear, because there can be no graceful retreat from such a mountain malinvestment and generally bad decisions that have characterized BAU for some time. When the dam finally cracks, it will be a bust for the ages.

    • Tolstoy's Degenerate Grandson says:

      Here’s the thing.

      It is very easy to see the trees through the forest. The steps are:

      – Assume that almost everything in the MSM is a lie/propaganda. The only way to combat this is to read MSM from the various perspectives – RT.com, Al Jaz, BBC, NYT, Bloomberg, etc… but more importantly read Zero Hedge, David Stockman etc (most are aggregated on ZH so you really only need that)

      – Use google to research issues

      – Understand that cognitive dissonance is a little devil always attempting to shape your perceptions. And smack the little bastard in the head when you feel him imposing.

      – Be willing to change your mind if the facts do not support your position

  30. edpell says:

    In the movie The Days After Tomorrow the high achieving high school student says the world she has spend her whole life preparing for no longer exists. I feel the same way. I have spent my whole life in science and technology. I have no interest in being a farmer. Even though I agree with folks here that is the best way forward. It just does not seem interesting or fun.

    • Jan Steinman says:

      I have no interest in being a farmer. Even though I agree with folks here that is the best way forward. It just does not seem interesting or fun.

      I think you need some “attitude adjustment.” 🙂

      I have the considerable advantage of having grown up on a subsistence farm, and yet, I couldn’t wait to “get off the farm” when I was a teenager!

      There followed a 30-year career in engineering, and yet, something seemed to be missing — I felt too far from my sustenance, too dependent on systems that I viewed as increasingly brittle and fault-prone.

      So I became a “reluctant farmer,” as you might see yourself becoming. But guess what? It is “interesting and fun!”

      You may surprise yourself. It took me several years to find a niche that made it all come together. For me, it was animals.

      I just delivered a breech kid less than half an hour ago. He had been hanging out of his dam for some time, and I cursed myself for not checking her earlier. His hind quarters were cold. When I pulled him, he didn’t breathe. I cleaned the afterbirth from his mouth, gently expanded his chest, and put my lips to his and gave him a few gentle puffs. He sputtered and coughed his way to life!

      It’s still touch-and-go. He doesn’t seem to have a normal suck reflex. I’m gonna weigh him in and hang out with him for a couple hours, to give him every chance I can.

      As an engineer (can’t bring myself to prefix that with “former”), I delight in creating systems. And guess what? A farm — especially a small one — is a “system!” A “system of systems,” in fact! I get to design and implement systems all day long, every day!

      After three years, I’m beginning to think I understand soil blocks — what works, what doesn’t, which size to use, when to transplant, etc. I’m on my second year of medicinal herbs, and I’m just starting to see a way forward there, with our own line of tinctures and skin care. And after six years of goat care, I still have surprises I have to figure out.

      Everything has to work together: the goat manure goes on the holy basil, which goes into our goat-milk soap. The pears get crushed into cider, some of which is double-fermented to vinegar, that we use in pickled produce that we sell. People love it! “You even made the vinegar?” they exclaim at the market.

      This makes information technology seem rigidly defined and uninteresting, by comparison. You might say that holistic, Permaculture-based farming is “NP-Complete.” There are no solutions; just new strategies to constantly try out. I’m so happy that I won’t be able to figure it all out in the years I have left!

      • Daddio7 says:

        Modern farming usually involves a thousand of hours a year or more pounding a bucking tractor through the fields or pulling leavers. I would spend a month on a backhoe cleaning drainage ditches. It’s blissful cruising around admiring your growing crop but all those years of abuse left me with torn rotator cuffs and arthritic hips not counting all the exposure to pesticides and chemicals. Old style farming is more sedate but farm animals can also cause injuries.

        • Jan Steinman says:

          For your use of the terms, “modern farming” and “old-style farming,” I prefer to think of “conventional farming” and “traditional farming.”

          In many ways, the “new traditional farming” is more “modern” than conventional farming is. Check out Restoration Agriculture, by Mark Shepard. Permaculture gives those of us with a techy edge something to find challenging.

          “Modern” Permaculture farming is all about perennial polyculture, which doesn’t require either “bucking tractors” nor draft animals. We aren’t there yet, but we keep pushing in that direction.

          The biggest challenge is staying about one step ahead of the curve — not much more or less. If you have lots of money to waste, you could do conventional (annual crop) farming with draft animals, and claim you were free of the matrix. But you wouldn’t survive in the marketplace.

          So we’re trying to stay as far from the matrix as we can, without handicapping ourselves too much, and while at least being able to imagine ourselves surviving completely off-grid, should The Big One hit.

          By no means do I think we’re “ready for anything,” but I suspect we’re a great deal more ready than 99% of the citizens of the industrial world.

      • pintada says:

        I can agree with and second everything Jan Steinman said above, but with two changes:

        Replace the concept “goat” with “bee”.
        Replace “engineering” with “IT”.

        It is really great that someone the same age with a similar background is enjoying basically the same life as much as me.

        • Jan Steinman says:

          Replace the concept “goat” with “bee”.
          Replace “engineering” with “IT”.

          I really don’t want to get into the “one upmanship” game — and I’m envious of your honey — but can you collect enough bee manure to fertilize your garden beds? 🙂

          And I consider most IT to be a form of engineering. It all boils down to problem-solving. Transfer that skill to “the real world,” and you’ve got it made, as much as it can be.

    • Glenn Stehle says:

  31. Don Stewart says:

    Dear Gail and Finite Worlders
    Expanding a little on my post about a potential reversion to family and community as non-bureaucratic, energy efficient ways of addressing the issues of life. Here is a current example, which may illuminate some of the choices.

    Harari makes the point that the Ottoman Empire let family feuds settle many disputes that, today, routinely go to courts of law. You will find that family feuds lead to more violence, but don’t require the bureaucracy and consequent energy costs. A local university recently investigated an alleged rape. The Obama Administration has been pushing the universities to become, in effect, the courts and police for trying rape cases. This is problematic, not least because rape and consensual sex both tend to happen when there aren’t a lot of onlookers to testify about what actually happened. Forensic evidence can establish the fact that sex occurred, but what does a bite on the neck prove?

    In my state, legally defined rape includes certain cases where a mature individual has sex with a minor who is below the age of consent, and also when a person who is relatively sober has sex with someone who is incapacitated by illegal drugs or by alcohol. In this particular case, both the alleged rapist and the supposed victim had been drinking. Witnesses at the party that both had attended gave somewhat contradictory evidence about the state of sobriety of the two participants. The local Police investigated and the District Attorney did not bring charges…presumably because the DA did not think he could produce evidence that would stand up in court about differential levels of drunkeness.

    The university, under pressure to ‘do something’, hired an investigator and, based on secret evidence which was not offered for cross examination, denied a diploma to the male. The male returned to his native country and sued the university. During the suit, the investigator hired by the university was found not to be a licensed private investigator, and a cease and desist order was issued to the university. The male is seeking very large damages in terms of ‘lost future income’.

    So far as I know, the damages case has not been decided.

    In the Ottoman Empire, two families would have to either agree to something or engage in a fight or something would happen. Our current policy is to have two levels of courts and police investigate: the local courts and police and a makeshift university court and police. You can see that we have chosen a very energy intensive system. It is doubtful, in my mind, that the two level system makes any sense, and I do not think that a future without fossil fuels could possibly afford it.

    Don Stewart

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