We are at Peak Oil now; we need very low-cost energy to fix it

This past week, I gave a presentation to a group interested in a particular type of renewable energy–solar energy that is deployed in space, so it would provide electricity 24 hours per day. Their question was: how low does the production cost of electricity really need to be?

I gave them this two-fold answer:

1. We are hitting something similar to “Peak Oil” right now. The symptoms are the opposite of the ones that most people expected. There is a glut of supply, and prices are far below the cost of production. Many commodities besides oil are affected; these include natural gas, coal, iron ore, many metals, and many types of food. Our concern should be that low prices will bring down production, quite possibly for many commodities simultaneously. Perhaps the problem should be called “Limits to Growth,” rather than “Peak Oil,” because it is a different type of problem than most people expected.

2. The only theoretical solution would be to create a huge supply of renewable energy that would work in today’s devices. It would need to be cheap to produce and be available in the immediate future. Electricity would need to be produced for no more than four cents per kWh, and liquid fuels would need to be produced for less than $20 per barrel of oil equivalent. The low cost would need to be the result of very sparing use of resources, rather than the result of government subsidies.

Of course, we have many other problems associated with a finite world, including rising population, water limits, and climate change. For this reason, even a huge supply of very cheap renewable energy would not be a permanent solution.

This is a link to the presentation: Energy Economics Outlook. I will not attempt to explain the slides in detail.

Slide 1

Slide 1

Slide 2

Slide 2

Some people falsely believe that energy supplies are “only needed for industrial purposes.” Energy supplies are, in fact, needed for many things: cooking our food, keeping our homes warm, and creating the clothing we expect to wear. It would be impossible to feed, house, and clothe 7.3 billion people without supplemental energy of some kind.

Slide 3

Slide 3

Slide 4

Slide 4

Slide 4 suggests that the world economy is heading into recession, because recent growth in the use of energy supplies is very low recently. Another sign that we are headed into recession is that fact that CO2 emissions fell in 2015. They usually don’t fall unless a global crisis exists. Emissions fell when the Soviet Union collapsed in 1991, and they fell during the economic crisis in 2008. Perhaps the world economy is hitting headwinds that are not being picked up well in conventional calculations of GDP growth.

Slide 5

Slide 5

Slide 5 shows a chart I put together, using data from several different sources, showing how growth in energy consumption has compared with growth in GDP. Growth in GDP tends to be somewhat higher than growth in energy consumption.

Economic growth (and growth in energy use) was low prior to 1950. There was a big jump in economic growth immediately after World War II, in the 1950-65 period. There was almost as much growth in the 1965- 75 period. Since 1975, economic growth has generally been slowing.

Slide 6

Slide 6

Between the years 1900 and 1998, the use of electricity rose (black line) as the cost of electricity fell (purple, red, and green lines). Electricity consumption could rise because it was becoming more affordable. Rising electricity consumption allowed the economy to make more goods and services. Workers (with the use of electricity) were becoming more efficient, so wages could rise. With higher wages, workers could afford more products that used electricity, such as electric lights for their homes and radios.

If electricity prices had risen instead of fallen, it seems doubtful that this pattern of rising consumption could have taken place.

Slide 7

Slide 7

The comments in Figure 7 represent my own view. It is based on both theoretical considerations and historical relationships. Many who have studied the economy believe that energy is important for economic growth. In my view, the real need is for cheap-to-produce energy, not just any energy. If cheap energy is not really available, then adding more debt can somewhat make up for the high cost of energy production.

Debt is important because it makes goods affordable that would not otherwise be affordable. For example, having a loan for a house or a car makes a huge difference regarding whether such an item is affordable.

Even when energy products are cheap, debt seems to be needed to get oil or coal out of the ground, or to make a new device such as a wind turbine. Part of the problem is the cost of the capital equipment needed to extract the oil or coal, or the cost of the wind turbines themselves. Another part of the problem is paying for factories to make devices that use the energy product. A third problem is making it possible for users to afford the end products, such as houses and cars. It is much easier to borrow the money for a new tractor, and pay the loan off as the tractor is put to use, than it is to save money in advance, using only the funds earned when farming with simple hand-held tools.

Slide 8

Slide 8

I mentioned the need for $20 per barrel oil on Slide 7. This is a very inexpensive price. Slide 8 shows that the only time when oil prices were that low was prior to the mid-1970s. (Note that the amounts in Slide 8 have already been adjusted for inflation, so my $20 per barrel target is an inflation-adjusted amount.) The cost of oil production is now far above $20 per barrel. The sales price now is about $37 per barrel. This is below the price producers need, but still above my target price level.

Slide 9

Slide 9

Slide 9 explains where I got my $20 per barrel price target. Back prior to 1975–in other words, back when oil prices were generally low, $20 per barrel or less–the increase in debt more or less corresponded to the growth in GDP. Once prices rose above $20 per barrel, the amount of debt needed to produce a given amount of GDP growth rose dramatically.

Slide 10

Slide 10

Slide 10 shows interest rates for US debt with 10-year maturity. These interest rates often underlie mortgage rates. As interest rates fall, homeowners can afford increasingly expensive homes. If shorter-term interest rates fall as well, auto loans become cheaper too.

Slide 11

Slide 11

The value to society of a barrel of oil is determined by how many miles it can make a diesel truck go, or how far it can make an airplane fly. This value to society is more or less fixed. The only change is the small increment each year from efficiency changes, making a barrel of oil “go farther.”

In the 2000-14 period, the cost of new oil production was increasing very rapidly–by more than 10% per year, by some estimates. The rising cost of oil production occurred much more quickly than efficiency changes. The result was a falling difference between the value to society and the cost of production. When oil prices are high, oil-importing nations tend to suffer recession. When oil prices are low, oil-exporting nations find it hard to collect enough taxes to support their many programs.

Slide 12

Slide 12

The fact that we need energy for economic growth means that we somehow must obtain this energy, even if doing so costs more. The big run-up in oil prices is a major reason for the historical run-up in debt levels. China’s big build-out of homes, roads, and factories was also financed by debt.

The higher cost of oil affects many things that we don’t think are related, including the cost of building new homes, the cost of building cars, and the cost of building roads. As consumers are forced to buy increasingly expensive homes and cars, and as governments find that the building of roads is increasingly expensive, more debt is used. The terms of loans are often longer as well, to hold down monthly costs.

If we still had cheap oil, this oil by itself could provide a “lift” to the economy. An increasing amount of debt can “sort of” compensate for the absence of cheap oil.

The problem we encounter is that neither cheap energy nor the continued run-up of debt is sustainable. Cheap energy tends to change to expensive energy, because we use the cheapest sources first. The continued debt run-up becomes more and more difficult to handle, unless interest rates fall lower and lower. At some point, interest rates can’t fall enough, and the whole pile of debt tends to collapse, like a Ponzi scheme.

Slide 13

Slide 13

I gave this talk on December 15; the first increase in interest rates took place on December 16. With rising interest rates, we suddenly have “the prop” that was attempting to hold up economic growth taken away.

We need ever expanding debt–that is, debt rising faster than GDP levels–to try to keep the world economy growing, so that the whole pile of debt doesn’t fall over and collapse. If we are to have non-debt growth in the future (because we are reaching limits on debt), it needs to again come from cheap energy alone. We need to get back to something similar to the low-cost energy that fueled the economy before the debt run-up.

Slide 14

Slide 14

Most of us have heard the Peak Oil story, and assume it represents a reasonable view of where we are headed. I think it is close to 180 degrees off course.

Slide 15

Slide 15

M. King Hubbert talked about a very special situation–a situation where another cheap, abundant fuel took over, before fossil fuels began to decline. In this particular situation (and only in this particular situation), it is reasonable to assume that production will follow a symmetric “Hubbert Curve,” with half of the production coming after the peak, and half beforehand. Otherwise, the down slope is likely to be much steeper.

Many peak oilers missed this important point. We certainly are not in a situation today where another very cheap fuel has taken over.

Slide 16

Slide 16

Slide 16 represents what I see as the predominant “Peak Oil” view of the oil limits situation. Some individuals will of course have different opinions.

Slide 17

Slide 17

Peak oilers certainly did get part of the story right–at some point, the cost of oil extraction would rise. What they got wrong was how the whole scenario would play out. It turns out, it plays out pretty much the opposite of what most had supposed–that is, with stagnating wages, loss of buying power, and prices of all commodities falling because of lack of “demand.”

We seem to be hitting energy limits, right now. That is why debt is such a problem, and it is why prices of many commodities, including oil, are far too low compared to the cost of production.

Slide 18

Slide 18

Slide 18 shows the fall of commodity prices up through 2014. The fall in commodity prices has continued in 2015 as well. The story we frequently hear is about low oil prices, but there is also a problem with low natural gas prices. Coal prices are low now too, and, in fact, many coal producers are near bankruptcy. Prices of iron ore, steel, copper, and many other metals are very low, as are prices of many kinds of staple foods traded internationally.

Slide 19

Slide 19

The problem with low commodity prices is that there are many loans that have been taken out to support their production. There is a significant chance of default, if prices remain low. Also, low commodity prices affect asset prices–for example, prices of coalmines, or prices of agricultural land. As the prices of commodities fall, the price of the land used to produce those commodities falls. When this happens, it becomes difficult to repay the loans on the property.

Slide 20

Slide 20

Peak Oilers were right about the cost of production continuing to rise. What they missed was the fact that prices would at some point fall behind the cost of production because of affordability issues. Low prices would then bring the economy down, as it did in the Depression in the 1930s, and in quite a few earlier collapses.

I think of increased demand, provided by debt, as being like a rubber band. Just as a rubber band can stretch for a while, the price of oil can rise for a while, fueled by more and more debt. At some point, debt can’t rise any higher–the rate of return on investments made using debt is too low, and defaults become too frequent. Instead of continuing to rise, commodity prices fall back. Market prices of commodities fall to much lower prices than the costs of production.

In order to get oil prices up higher, the wages of factory workers, restaurant workers, and other non-elite workers need to rise, so that they can afford to buy nice cars and nice homes. Commodities of many types are used both in making homes and cars, and in operating them.

Slide 21

Slide 21

If space solar (or for that matter, any renewable energy) is to be helpful, it needs to be very cheap, so that products made using renewable energy are affordable.

If the replacement energy source is cheap enough, perhaps there will not be a huge run-up in debt to GDP ratios, to finance the new devices used to provide electricity or other energy.

We are encountering problems now, so we need a replacement now, not 20 or 50 years from now.

Slide 22

Slide 22

We cannot expect the cost of electricity production to be more than the current wholesale selling price of electricity. Thus, it needs to be four cents per kWh or less. Ideally, the price of electricity should be falling, as in Slide 6.

Another consideration is that we need to be able to operate our current vehicles using a liquid fuel, made with electricity, because of the time and materials involved in switching over to electric vehicles. This requirement likely reduces the maximum cost of electricity even below four cents per kWh.

Slide 23

Slide 23

It is possible to run into many different kinds of limits, over a period of time. In my view, the first limit we reach is an affordability limit. We can tell we are hitting this limit when high prices reverse to low prices, as they have done since 2011. The fact that prices are continuing to fall is especially worrisome.

Slide 24

Slide 24

There has been a popular myth that it is OK for energy costs to rise. We will just choose the least costly of the high-priced alternatives. This approach doesn’t really work, because wages do not rise at the same time.

Also, we have to compete with other countries. If their energy costs are cheaper, their manufacturing costs are likely to be lower.

Slide 25

Slide 25

If conditions existed that allowed oil prices to rise endlessly (in other words, rising wages of non-elite workers together with debt that could spiral ever higher, as a percentage of GDP), we wouldn’t really have a problem–we could afford increasingly expensive substitutes.  Unfortunately, the story of ever-rising oil prices is simply fiction. It is a pleasant story, but not really true. I explain some of the issues further in “Why ‘supply and demand’ doesn’t work for oil.”

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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1,585 Responses to We are at Peak Oil now; we need very low-cost energy to fix it

  1. Fast Eddy says:

    “It’s Coming To A Head In 2016” – Why Bank of America Thinks The Probability Of A Chinese Crisis Is 100%

    “It seems to us that the government’s policy options are rapidly narrowing – one only needs to look at how difficult it has been for the government to hold up GDP growth since mid-2014. A slow-down in economic growth is typically a prelude to financial sector instability. Putting it all together, it seems to us that many of these conflicts may come to a head in 2016.”


  2. Fast Eddy says:

    I was asking recently what Kyle Bass thinks about the current situation …

    Publicly this is what he thinks http://www.zerohedge.com/news/2016-01-04/kyle-bass-greatest-investment-opportunity-right-now

    Dance while the music plays I guess…. never know when the music will stop..

    But I wonder what he really thinks….

    I know a couple of fairly senior finance people who while they will not accept the oil as the disease theory —- believe that something cataclysmic is coming …..

    That said — you’d really have to be a fool not to see that the the central banks are the market now — profits are down but the markets keep hitting records…. that something very catastrophic is sure to result from all of this….

    Surely Kyle Bass who in the run up to 2008 was one of the few people who saw through the MSM spin on this …. understands that this ends very badly — again. And that the central banks are unlikely to be able to come to the rescue this time

    • Bass is betting on another cycle up as after 2008/9, obviously we don’t know how much of his net worth is on the table this time, but it sounds as pretty substantial part. Overall, his thesis is pretty much realistic, next 2-4yrs of carnage looking for bottom in the energy sector followed by the last QE ubermadness, as result scoring several thousands % gain in value of stocks and much more under leverage, options, futures and derivative schemes..

      Bass added he was agnostic as to what subsector of energy one should invest in: whether it is infrastructure, pipelines, producers, upstream, downstream, he believes that there are places in the cap structure of each of these where once can put new capital and generate substantial returns. He also added that “the energy rebound, when it happens, will be comparable to the housing rebound post 2009.”

      • psile says:

        I don’t believe he thinks there will anyone left to collect from this time. He says he was lucky in 2008 because the FED backstopped the world economy from sliding into the abyss, just, in which case he would have made nothing from his option positions.

      • B9K9 says:

        I’m also betting on a repeat of 2008, but an order of magnitude greater. 2008 was the first blush of an emergent addict still pretending he could operate in society as a functioning, productive member. Now, 8 years later, our dabbling addict is a full-blown junkie living in a crack house. Any pretense of reform is just a cover to con some new acquaintance. (All his family & true friends gave up long ago.)

        2008 was the point were industrial civilization crossed the Rubicon. It was a tortured decision, because many thought free markets should be allowed to clear. Now, in 2016, there is no longer any conceivable notion of letting market pricing operate. CBs – under protective cover of each respective government – are going to print like there is no tomorrow; which, of course, there really isn’t.

        Which gets us back to what the central argument @ FW should be*, which is: does the system crash and set in motion an abrupt ending of BAU, or does the PTB engage in a series of emergency measures (de-valuation, price controls, rationing, etc) to maintain rule & order?

        * Gail’s site, but if she moderated comments to focus on what really is the key issue (ie how does BAU end, quickly or slowly), then perhaps a more informed, cohesive discussion could take place. In other words, block/delete any/all comments that discuss AE or other techno-miracles.

        • kesar0 says:

          I bet on the next “intervention” in Middle East region to “stop the wave of immigrants”, which is equivalent/mass media cover for “we need access to cheap energy and these guys are doing Muslim Revolution”. It will support western BAU a decade, I guess. Till the next slide down.

        • Van Kent says:

          Don´t know about Gail, but its kinda fun listening to RE solar Jesuses and techno-miracle people. They are so aww.. cute as kittens, naive beyond belief.

          And as for the fast/ slow, total collapse vs. slow grind BAU-lite conversation, well, there is a mismatch in competence, those that understand how banks, derivatives, the global financial system works, they are pretty much on the same page; Mitch Feierstein: Total Economic Collapse Coming In 2016 https://www.youtube.com/watch?v=XauSt2BYm2Q

          When you see the absurdity we are in; Deutsche Bank has liabilites worth as much as the entire world GDP (80 trillion), its easy to see that BAU will go fast and wont be coming back..

          • “When you see the absurdity we are in; Deutsche Bank has liabilites worth as much as the entire world GDP (80 trillion), its easy to see that BAU will go fast and wont be coming back..”

            Numbers on a ledger. Numbers that can be replaced with zeroes. As long as everyone goes along with it, all is well.

            The collapse only happens, I think, if too many people reject wiping away excess liabilities.

            • Van Kent says:

              Its exceedingly difficult to go to the grocery with a zero. Buy a home with a zero, a car, start a business, or pay workers in your employment. Not a bad idea though, I could take my own natural hot springs resort with that zero, and pay all the cooks, cleaners and masseuses in that resort with that same zero.

              Wouldn’t hold my breath though

            • “Its exceedingly difficult to go to the grocery with a zero”

              I didn’t say anything about zeroing anyone’s assets, just the liabilities. So Bank A owes Bank B a trillion dollars. We just put a trillion dollars onto the balance sheet of Bank B, make the balance on Bank A a 0.

              Of course, this is an extreme example to show the nebulous nature of money in the modern world, and the power of a central bank to overcome a crisis.

              Is it a good idea? no. Will it adversely affect the faith in the money? absolutely. Is it better than having the entire financial system worldwide collapse in a matter of hours?

            • Fast Eddy says:

              Yep – it’s like a game of Monopoly…. when you get too far behind you just kick the table over … say sorry … and start another game.

            • Van Kent says:

              That would eliminate fractional reserve banking, central banks, private banks, hedge funds, IMF, London, Wall Street, pretty much the financial power structure we have today including a quadrillion of derivatives. If we had a currency backed by the GDP of a country and not debt, then that could be possible I guess. China, Abraham Lincoln and Hitler could perhaps do it (they had currencies backed by the GDP not fractional reserve banking), but I doubt we could.

              How would we balance government budgets? Are bonds going to zero at the same time? If the US treasuries are at zero, then also the dollar goes to zero.. Without a currency trade stops and the banks collapse nonetheless.

              Trading zeros would be an interesting war game to play in the Pentagon in their next playing session..

    • Thestarl says:

      I believe the guy has an extensively stocked compound in Texas

      • True, he has got the base covered. But he is a player so he continues to play till-near? the end.
        So perhaps from knight from texas he might be shooting for the Duke of Texas level, who knows..

        • Fast Eddy says:

          Some Words Of Advice From Kyle Bass

          Michael Lewis’ latest compilation of Vanity Fair articles into book format, Boomerang, is the usual entertaining romp around those back and front waters of the world that are currently on the verge of bankruptcy: from Greece, to Ireland, to Germany and, of course, to California.

          The premise at its core is an interview that the former Salomon bond salesman had with investing wunderkind Kyle Bass several years back which inspired to him to ask what it is that the Texan saw three years ago that so few others, due to a permafrosty cognitive bias or what have you, could (i.e., that the world is bankrupt and getting much worse). Oh, did we say wunderkind? We meant billionaire. Because unlike that other “anti-Midas” who only piggybacked on the good ideas, while blowing up LPs when left to his own non-Goldman Sachs facilitated devices, Bass actually could always see the big picture for what it is.

          So courtesy of Lewis’ latest book, here are three pieces of advice from Bass to people everywhere, which will surely bring the fanatically jealous anti-gold crew to accusations that Bass made his billions from buying and reselling tinfoil hats.

          On gold:

          A guy sitting in an office in Dallas, Texas, making sweeping claims about the future of countries he’d hardly set foot in: how on earth could he know how a bunch of people he’d never met might behave? As he laid out his ideas I had an experience I’ve often had, while listening to people who seem perfectly certain about uncertain events. One part of me was swept away by his argument and began to worry the world was about to collapse; the other part suspected he might be nuts. “That’s great,” I said, but I was already thinking about the flight I needed to catch. “But even if you’re right, what can any normal person do about it?”

          He stared at me as if he’d just seen an interesting sight: the world’s stupidest man.

          “What do you tell your mother when she asks you where to put her money?” I asked.

          “Guns and gold,” he said simply.

          “Guns and gold,” I said. So he was nuts.

          But not gold futures,” he said, paying no attention to my thoughts.

          “You need physical gold.” He explained that when the next crisis struck, the gold futures market was likely to seize up, as there were more outstanding futures contracts than available gold. People who thought they owned gold would find they owned pieces of paper instead. He opened his desk drawer, hauled out a giant gold brick, and dropped it on the desk. “We’ve bought a lot of this stuff.” At this point, I was giggling nervously and glancing toward the door.

          So many others were giggling along. They were giggling all the way as gold rose from $800 to $1900. Probably not giggling now…

          On nickels:

          He still owned stacks of gold and platinum bars that had roughly doubled in value, but he remained on the lookout for hard stores of wealth as a hedge against what he assumed was the coming debasement of fiat currency. Nickels, for instance.

          “The value of the metal in a nickel is worth six point eight cents,” he said. “Did you know that?”

          I didn’t.

          “I just bought a million dollars’ worth of them,” he said, and then, perhaps sensing I couldn’t do the math: “twenty million nickels.”

          “You bought twenty million nickels?”


          “How do you buy twenty million nickels?”

          “Actually, it’s very difficult,” he said, and then explained that he had to call his bank and talk them into ordering him twenty million nickels. The bank had finally done it, but the Federal Reserve had its own questions. “The Fed apparently called my guy at the bank,” he says. “They asked him, ‘Why do you want all these nickels?’ So he called me and asked, ‘Why do you want all these nickels?’ And I said, ‘I just like nickels.’”

          He pulled out a photograph of his nickels and handed it to me. There they were, piled up on giant wooden pallets in a Brink’s vault in downtown Dallas.

          “I’m telling you, in the next two years they’ll change the content of the nickel,” he said. “You really ought to call your bank and buy some now.”

          And on how to prepare for what is coming and why it is coming:

          We hopped into his Hummer, decorated with bumper stickers (God Bless Our Troops, Especially Our Snipers) and customized to maximize the amount of fun its owner could have in it: for instance, he could press a button and, James Bond–like, coat the road behind him in giant tacks. We roared out into the Texas hill country, where, with the fortune he’d made off the subprime crisis, Kyle Bass had purchased what amounted to a fort: a forty-thousand-square-foot ranch house on thousands of acres in the middle of nowhere, with its own water supply, and an arsenal of automatic weapons and sniper rifles and small explosives to equip a battalion.

          That night we tore around his property in the back of his U.S. Army jeep, firing the very latest-issue U.S. Army sniper rifles, equipped with infrared scopes, at the beavers that he felt were a menace to his waterways. “There are these explosives you can buy on the Internet,” he said, as we bounded over the yellow hills. “It’s a molecular reaction. FedEx will deliver hundreds of pounds of these things.” The few beavers that survived the initial night rifle assault would wake up to watch their dams being more or less vaporized.

          “It doesn’t exactly sound like a fair fight,” I said.

          “Beavers are rodents,” he said.

          Whatever else he was doing, he was clearly having fun. He’d spent two and a half years watching the global financial system, and the people who ran it, confirm his dark view of them. It didn’t get him down. It thrilled him to have gotten his mind around seemingly incomprehensible events. “I’m not someone who is hell-bent on being negative his whole life,” he said. “I think this is something we need to go through. It’s atonement. It’s atonement for the sins of the past.”


          Based on this …. I don’t think he expects the Fed to be able to do much next time around….

          • Vanity Fair? Lolz.
            Seriously, it doesn’t change much what has been posted here previously.
            Bass has covered his base/camp, but the firm he owns and runs still have to be invested into something, so he announced he is now playing-betting on energy rebound in say 5yrs time (apart from likely other not-announced bets and hedges).. So if the central bankers kick the can for a decade or more, he will earn more billions on the inflationary energy upswing, if not he is covered, not worried, end of story..

  3. Fast Eddy says:

    It’s a miracle…

    “Someone” stepped in and bid the entire Chinese market higher off its huge opening gap down…

    Despite the biggest liquidity injection (CNY130bn) in 4 months, it appears Kyle Bass’ top trade remains well on target as Offshore Yuan plunges, underperforming Onshore Yuan despite the largest Fix devaluation in two months.

    In a word – it’s chaos in Chinese markets. The Shanghai Composite looks to be opening down 3% – extending yesterday’s losses (beyond the US session’s ADR’s move). What a mess.


  4. B9K9 says:

    I come back after a few weeks out of town and what do I see? A numbskull prattering on about an imaginary universe, driving poor Paul crazy in the process. LOL

    Can we just cut to the chase and discuss what’s going to happen when the spice runs out?

    The Euro cities we visited are very popular with continental tourists. Not one of them exists in the context of “real” work being performed today. Rather, everything is related to enjoying the art & spectacle of development that took place centuries ago.

    In all the paintings, it is clear the countryside was fairly pristine outside the city walls. Today, the sheer mass of people who no longer farm or produce tangible goods crowd the re-made shopping alley ways in huge masses. The one thought I had when I wasn’t just floating along enjoying the fun & games was: overshoot.

    Oil is what got us here, and it’s not gonna be pretty as it’s withdrawn. First is the inevitable reduction in quality of life and reduced standards of living, which is already obvious to anyone paying attention. Next comes the fighting over diminishing resources and movement of people, which is also quite evident.

    Of course, the debt built up – first to finance production, then to sustain the welfare state – will never be paid. But what to do about the overhang? De-valuation of course, which is what K Bass is now discussing. But it’s not just limited to China – every debt financed country will have to impose the same solution.

    The point? Live it up suckers – hitch your wagon to the state, because they are going to act in their best interest.

    • Fast Eddy says:

      I just finished the audio book Dune…. and am onto Messiah…. the spice is indeed running out…

      Gotta like this global warming thing or whatever it is that is making ‘winter’ so warm here in Europe…. just keep heaving more coal on the funeral pyre….

      • psile says:

        My favourite Sci-Fi series ever. Still got the paperbacks I had as a child. 40 years ago! Pity no one was ever able to do the series any justice at the movies. The closest and palest imitation was Star Wars, which George Lucas admits he borrowed many of the concepts from.

    • “Can we just cut to the chase and discuss what’s going to happen when the spice runs out?”
      But first we will have to get through the phase of the spice supply not growing anymore and actually decreasing y/y, this could be observed both as in “theoretical” global aggregate and perhaps more importantly as local peaks though, and local peaks can be readjusted-redistributed* by country vs. country via economic and/or kinetic warfare.

      According to Ron’s post and graphs this* situation is approx a decade away, perhaps longer. Obviously even before that physical peak nasty things can break the neck within the economic structure, i.e. Gail’s thesis..

    • Thestarl says:

      According to Royal Dutch Shell The Blueprints or the scenario they favour The Scrambles.

    • Rupert says:

      “I come back after a few weeks out of town and what do I see? A numbskull prattering on about an imaginary universe, driving poor Paul crazy in the process.”

      Far from being a numbskull, I was debating the comments of some who think that the biological system is benign and therefore making a critique of it, stating that the food chain is at the heart of the biological system. As for “imaginary” universes, plenty of scientists believe that there must be a multiverse, on the basis that there is never just one of anything – in this case, the universe. And “thought experiments” are of course common in philosophy – not that I’m a philosopher. Sadly, your intellect doesn’t stretch to any of that, so instead of constructing a valid counter-argument, you stoop to silly personal insults such as “numbskull”. But, talking of the food chain, I’d better stop feeding the troll…

  5. Bertha G. Stere says:

    The situation in Oregon is to me the first symptom of individuals upset with resource reallocation. Water is perhaps more precious than gasoline. The BLM stole the water rights from the family in Oregon and sent them to prison. The idea of a water right will prove to be very malleable in he future I believe. When it comes back to it when it comes to needs as primal as this force supersedes and supports the new allocation. The media is characterizing the individuals in Oregon in all sorts of manners that would suggest their fate will not be kind. When the reallocation steam roller comes through best get out of the way or choose to get squashed.

    • In the US (and elsewhere) one has to expect total land grab (incl. water, hunting, foresting and mineral rights) which will be on the ground manned by various former US gov agencies. Simply the remnants/faction of current TPTB are going to privatize and feudalize the various regions to their liking via boots on the ground – armies. I can’t give you the exact time-plan on it, but now this is the very early stage, likely followed by state vs. state and then lastly individual region/neo-feudal vs. other opponents. The public will be largely discarded in this process. It’s natural historic process of decay of formerly complex societies.

    • Stilgar Wilcox says:

      There’s a procedure called Escheat, which means if the govt. needs a person’s property they can escheat it by paying an appraised valuation then establishing the number of days until it must be vacated. I know someone that owns a house in Hawaii and he had to give up part of the land for the local govt. to park construction vehicles on while a small bridge is replaced. We are all subject to TPTB. There’s an old saying, “You can’t fight city hall.”

    • pintada says:

      You may not believe this initially, but if you do a little research, you will find that the Hammons were convicted by a jury of their peers of committing arson to cover up poaching on Federal land. I agree with the original judge that 5 years is a little excessive in terms of their sentence, but they are criminals.

      Regarding the claim that, “The BLM stole the water rights from the family”, please – get real.

      • Bertha G. Stere says:

        “Regarding the claim that, “The BLM stole the water rights from the family”, please – get real.”

        Here is a rather unbiased accounting of the facts in this matter. I find the Judges comments to be most revealing. Or does he need to “get real” too?


        I have no dog in this fight. The Hammonds took on the feds and payed the price. They were fools.
        To think this is anything than theft of a resource by force however demonstrates a high handedness that might be from ignorance but perhaps from something much more reprehensible. I understand that the public enjoyed public hangings very much when they were still fashionable.

  6. BTW so far nobody’s commenting on Gail’s interview with Chris Martenson or is it hidden in previous pages? I guess it was quite a good interview as Chris pushed a lot of subplots to the overall story and also Gail revealed some timelines from her perspective..

    I think people should also read some more “Mish” – we have entered escalating currency wars, which will likely lead to shooting war/revolution/reset and new dis-equilibrium. So definitively there is a different world after this system brakes down, but in my view I’d not discount muddling through at least till ~2050 on the scraps of today’s fossil world.

    • bandits101 says:

      “Muddling through”…….you cannot make a more diverse and at the same time obscure statement than that.
      Who will muddle through?
      How many?
      What does “muddling” mean?
      Will the muddling just stop in 2050?
      What happens after 2050?
      Will there be a war during or after the muddling?
      Will I still be able to use my iPhone?
      What jobs will be available in the financial, tourism, mining, insurance, armed services, transport, real estate, manufacturing, oil, government…….

      Maybe “muddling” means BAU lite………just a little bit less of everything but we all live happily ever after.

      • Sorry for using short cut, we discussed it here so many times..
        Firstly to put in context, Gail speaks about major economic dislocation due in 3-4yrs, likely before 2020. There is sort of broad agreement on this comment section that the current system is almost at its latest breath, however some as FE strongly believe this event is the end – the flash crash of civilization.

        On the contrary, I’m simply inside the “realistic camp” while acknowledging the historic super cycles colliding about now into this this incoming reset will be huge by any metrics but and there is the difference, history takes time, the material available, knowledge, and remaining fossil fuels (namely natgas, uranium and open pit brown coals) are so huge, that this is not “civilization” or “short hand human extinction” threatening event yet. In fact we will reshuffle into rather different “civilization” flavor with less per capita consumption in all aspects incl. frivolous consumerism, life expectancy (higher death rates), healthcare availability, political freedoms etc. So, in my view TPTB won’t be able to hold the current system intact much longer than ~2020-25 and chances are the above described post techno “muddling period” could snap by ~2055 into even lower stage of more or less openly feudal society even in many parts of the former west.

        Jobs for the “great muddling of 2025-2055” : certainly not tourism in the current scale and form (based largely on int. travel, sub-regions total dependency on this industry like parts of Italy/Greece , Alps skiing etc.), low tech/cost mining might provide “jobs security” but the conditions there will be harsh, similarly the idea of joining armed forces where the value of human life would be discounted (in today’s terms), real estate near total collapse – as the natural and economic crash induced demographics implosion will decimate wide sectors of housing – this also includes various building suppliers as most of the material will be reused from abandoned sections of housing, financial and insurance this will for the little people fall on the level of 3rd level practice of street vendor micro credits only, the new elite/rich banking will be also very much scaled down to fundamental services.. , in summary most “jobs” prospects available in clan/party/religion based and protected carrier paths, and the “best prospects” perhaps in distance-secluded areas for draft animal farming under the guarded monastery/fiefdom structures, ..

        All in all not exactly an iPhone world, but not the end of the world either.

    • Fast Eddy says:

      Last I read of Mish he refused to acknowledge that the end of cheap energy was the problem… he will not go there.

      That said – he like Stockman – does come up with some good observations of the symptoms — — so worth a look.— but still believes the disease is curable (corruption – stupidity at the highest levels of govt)….

      • True as I referred to Mish exactly on these points how TPTB will get the very last drops out of this system (perhaps one or two more decades) via spiraling currency wars and global financial system reset/play field reshuffle for allowing the last cycle.

        Similarly as Gail can see the end of cheap energy forcing but not the “eternal urge” of humanoids to form and force various schemes to rule over despite the reoccurring boom-bust civilization cycles.

    • Artleads says:

      Thanks. This reinforced the message that the whole economy, from top to bottom needs to be calibrated to work together. I still don’t get the part where we need new cars and new “homes.” Maybe small cars the size of go-carts and shanty type houses would still employ people while causing less destruction.

  7. Fast Eddy says:

    Just getting to the end of that Kunstler article and seeing this utter garbage…

    The last time I’ll be visiting that site…..

    ‘The cops present at several notorious incidents include black officers; a black female sergeant who was supervising the action on the sidewalk in Staten Island when her colleagues choked Eric Garner. (she did nothing to intervene); the several black policemen in Baltimore who took Freddy Gray on his fatal ride in the paddy wagon. It’s a scene fraught with ambiguity, to be generous.’

    • pintada says:

      I know. Right!!

      I used to enjoy his turn of phrase, and read the first several books in the trilogy, but now, knowing what he obviously is … That last volume can stay on someone elses shelf.

      • Fast Eddy says:

        I am not sure why he hammers away at Donald Trump. He should be running as Trump’s VP.

        As things continue to worsen they could come out with a message of ‘exterminate all people of colour, stupid people, fat people, anyone on a disability scooter, anyone with any sort of earring that is not in their ear, anyone with a tattoo, all Muslims, all Jews, anyone who follows any of those weirdo religions, etc….’

        This is the sort of message that worked for a guy in Germany in the 30’s when the country was going to pieces. Why not take a page out of that book?

        Oh — Kuntsler is a Jew. Ok, take the Jews off the list.

  8. Fast Eddy says:

    Klassic Kuntsler!

    Some might suppose that such a crash would drive prices back up again as the supply necks down. There are a couple of problems with that supposition. One is that the previous round of $100-plus oil did a lot of permanent damage to the economy, in particular to small businesses and households (i.e. middle-class workers).

    That damage looks more and more permanent, meaning a smaller aggregate economy and still-shrinking demand base as businesses and citizens go broke and stay broke. If oil prices do return to a level that would justify exploration and production of expensive, hard-to-get oil, (probably north of $110) it will only crash industrial economies again — and there are only so many times this can happen before the system is so damaged recovery is no longer possible. Another problem is that the oil price crash has done significant damage to the oil industry itself, including its credibility as a viable target for investment.

    Contrary to hopes and expectations, current low oil prices are doing nothing to re-stimulate economic activity. It all has the look of a self-reinforcing feedback loop, a downward spiral in a global complex networked system getting clobbered by the diminishing returns of its principal activities.


  9. Fast Eddy says:

    The train is headed over the cliff….. all the signs point to near term collapse…. if anyone is around post 2016 … 2016 goes down as the end of history….

    Year Zero starts …. and we return to a primitive state that would make Mad Max and The Road look like heaven on earth ….


    • hkeithhenson says:

      Eddy, two part prediction. One, the world next year will be much like it is now, and two, you will still be yapping about collapse about to happen.

      • Fast Eddy says:

        And I guarantee you that at some point in 2016 — if you continue to pollute these threads with your utter rubbish about space solar power —- you will be on the receiving end of one of my epic blasts of vitriol…..

        And you will join EV Pete… and the rest of the solar Jesus groupies …. cowering fearful in some dark corner sucking your thumb and calling for mommy.

        Mark my words….

      • psile says:

        FE only has to be right once. You, on the other hand, cannot ever afford to be wrong. Lol…

    • We have been through this numerous time already..

      Simply, the western people unlearned that to expect several deep impacts through one’s life is quite normal on this planet, e.g. regime change, destruction of currency, wars, loss of family members.. , even taking hit several times per century is somewhat normal.

      Obviously this time we are going to hit confluence of systemic disruption in several longer cycles, but again lot of skilled people, machines, fossil energy is still around us, it’s not going to turn into magic dust overnight. So, is it that much concerning your pension won’t exist in say 2decades time, when on the plus side your children might strike it lucky as sidekicks to nearby “warlord” lets rather say local administration? Or does it really matter the highway system will be largely defunct as local food system takes over, so surviving people don’t have to commute daily etc. etc.?

      • Fast Eddy says:

        ‘it’s not going to turn into magic dust overnight’

        Of course the Koomaya Krowd continues to pound on the wishful thinking drum.

        Do you guys think that if you repeat this stuff a million times that it will magically come true?

        Kinda like if you tell a big enough lie and repeat it enough people will believe it?

        I know you are afraid. We are all afraid (except those who welcome the ‘Great Adventure’ – those who think that the power going off heralds a brave new and exciting world….)

        I know you fret for your families – your kids — so it is comforting to take a spoon full of the hopium… it calms the nerves….

        In the Wizard of Oz the hopium was a mantra ‘There’s no place like home – there’s no place like home…’

        ‘The collapse will be gentle — the collapse will be gentle’

        But unfortunately some of us prefer facts. We prefer reality. Mantras don’t cut it.

        So let’s examine the cold hard facts….

        See China today — the stock market is again collapsing — the only thing stopping that from happening is the PBOC is pumping out cash and their Plunge Protection teams are buying up the stock market (and I am sitting in a hotel room i Prague thinking — surely these guys can hold this together for another few weeks because if they can’t I am stranded 2 long haul flights from where I want to see out the end of days….)

        Essentially you have companies that are failing — across the board — with no prospects for improvement because china has already poured more concrete in 3 years that the US did in a century…. and her export markets remain brutally challenged because the consumer is suffering from economic AIDS…..

        This is like revisiting 1929 — and the Fed saying — nope — no collapse — no Great Depression — we are just going to print trillion after trillion after trillion and use that money to keep the rally in stocks going.

        Do you think if they had done that the Great Depression would not have happened?

        If you think that they you need your head examined.

        If they had done that all they would have done was have made the Great Depression exponentially worse….

        And yet that is EXACTLY what is happening now — the central banks are saying — we will do ‘whatever it takes’ to fight this — because they know that because we are out of cheap oil there is no future anyways…. so they really don’t care about consequences….

        You either allow BAU to blow into a milion pieces now (imagine what happens if the central banks say — nah… we’re not going to buy China stocks tomorrow if the market crashes again….) or you stuff it with a few dozen tonnes more TNT and delay the explosion — but when it happens BAU goes into a billion pieces.

        A million or a billion — it doesn’t matter does it.

        It is impossible to predict specifically when this ends — but there is absolutely no way that it does not end badly — with badly being defined as a rapid, catastrophic collapse of the financial system — the global economy — civilization — BAU.

        That is absolutely certain.

        Money printing is not a perpetual economic motion machine — central banks can print trillions and buy the stocks of failing companies and we can pretend that a rising stock market means all is good…

        But it is not good. These are just numbers on Bloomberg terminals…. hey look at the stock market hitting record highs …. yet companies are collapsing into bankruptcy and mass layoffs are happening — hurrah!!!!

        There is no such thing as a perpetual economic motion machine. Or any other sort of PPM.

        When failing companies are failing because growth has ended…. unless growth can be re-ignited… then there is ultimately nothing you can do to stop them from collapsing.

        Grow or collapse. Those are the only two options.

        When the tipping point is reached — when we start pushing on a string as we appear to be now — total collapse is not far off.

        • This alarmist macho-pretend-ism is getting preposterous here..

          Well, if you have the organizational skills and cash to take vacation over CEE now – you can in the same vein “easily” travel back few hours/days to the Atlantic coast or Club Med and hire a skipper there to get you back into the US coast, this will work even under the global war scenario.. as it did during WWII for instance or earlier.. Is this forum place for grownups or you don’t have the extra money?

          • Fast Eddy says:

            I actually have to get to the south island of NZ….

            When BAU stops — the global economy — as it was on the verge of in 2008 — will stop.

            Flights will stop. Trade will stop. The electricity will stop. The ATMs will not work. Money will be of no value.

            Think you can’t be stranded?

            Read up on what happened in places like Shanghai in WW2… or check out what happened to Brits in the colonies of Singapore and Hong Kong…

            Ask a Jew if he knows anyone who went to the gas chambers because he refused head warnings and stayed on …. and stated that ‘the alarmist macho-pretend-ism is getting preposterous here’

            I am not saying it will happen while I am overseas — but if the China market continues to plummet and no matter what actions the central banks take the sell off continues because CONfidence has vapourized…

            Then you have your Lehman moment on steroids… and the central banks will have used up their ammo so they won’t be able to stop it…. the dominoes will not fall against one another rather the table will be kicked and the pieces will crash to the floor all at once…

            And the odds of getting two long haul flights when this goes down are slim….

            I always travel with at least 10 gold coins…. just in case….

            I’ve already set up my grave in NZ so it would be a shame to not use it….

            When this goes — it goes fast. Just like in 2008.

            Maybe you can turn Koombaya on to a really slow speed and play that when the SHFT— see if that makes it feel like a slow collapse….

            • That’s the nuance which makes the difference..
              As many fled Europe (or other locations) on time before the event or shortly afterwards in last pockets of available holes to escape, on the other hand others refused to even listen to any warning signs. For you it’s categorical total collapse for me it’s a “collapse of this version of civilization” including what follows as very nasty readjustment to fraction of today’s global population and likely lost of most of the current techno-advancements in the longer run, let say beyond 2050s, but this being compensated where locally applicable by better “life quality” see no till agriculture etc. BTW Sorry I forgot about your NZ domicile, that’s understandably a different story than a simple Atlantic crossing, my apology.

            • Fast Eddy says:

              We get constant postings about this BAU lite or whatever it is that comes next…

              But there are two key things that have to happen for this to happen — and nobody has provided a plausible way to deal with these two problems:

              FOOD – I have posted details of how virtually all arable land has been farmed using petrochemical fertilizers — how if those are not available then nothing grows on that land without years of organic inputs.

              Pray tell what the people who survive will eat? if there are organic plots around would they not be the first targets of the hungry hordes who will rip everything from the ground — who will kill all the animals…

              SPENT FUEL PONDS — I have posted great detail about a singe fuel pond blowing is like 100’s of Chernobyl’s….. there are 4000 of these — and they need high tech (BAU) facilities to remain operational — or they blow… releasing massive amounts of radiation… and they keep releasing this stuff for many decades

              Unless you explain how we deal with those two problems then the BAU lite scenario is total nonsense.

              It is Koombaya, Imagine, and I’d Like to Teach the World to Sing …. all rolled into one.

            • Rupert says:

              > I actually have to get to the south island of NZ….

              So that’s why you’ve started spelling everything the New Zealand way.

            • Fast Eddy says:

              You mean the use of proper spelling? That’s because I am originally from Canada… Queen’s English….

              And btw — the absolute last place I’d want to be when the SHTF is America —- it will be ugly everywhere but I reckon that’s the epicentre of nasty given the race relations and all those guns….

              I’d rather hole up in an EU hotel and order in room service and a bottle of pills….

            • psile says:

              Oh, don’t be so alarmist FE! 😀 Everyone will have at least a few days to get their acts together and get out of Dodge, or not, as the case may be. I see many people, even on this board that are going to go down with the proverbial ship. C’est la vie…

        • This is absolutely ahistoric approach.
          What do you think is going to happen when banks go seriously down?
          The COG goes alive and depending on the situation some another makeshift human farm controlling system emerges out of the rubble. Do I care if US implodes into regional fiefdoms ruled by mil-industrial types to lesser or larger successes, no. Do I care EU/EUR is going down, no as long in the aftermath some sub regions are still able to defend possible outbreak of serious ME migrant invasion in dozens of millions of refugees as shown in history Poles, Hungarians, Russians and Serbs can manage that.

          • Fast Eddy says:

            Not quite.

            There will be no food – and 7.5 billion people.

            There will be no way to stop 4000+ spent fuel ponds from exploding.

            If Ladbrokes were taking bets on this being an extinction event the odds would be overwhelmingly heavy in favour…

            • Sorry, as I said perhaps hundred times already I’m not interested in keeping your 7.5 billion people afloat. The other “extinction level” threats like spent fuel ponds are valuable discussion points though, but again being in the “muddling camp” for next few decades this issue might get priority over other issues like “feeding the world”.. inside the different paradigm of that era ..

            • “Sorry, as I said perhaps hundred times already I’m not interested in keeping your 7.5 billion people afloat.”

              What do you think those ~7 billion extra mouths are going to do without food? Just sit there and wait to die? The Arab Spring is a hint that maybe, at least some people are going to get mad and start lighting things on fire instead.

              If the starving people collapse the government, then what happens with the power grid and oil infrastructure?

              If that happens, what happens to the reactors and spent fuel ponds?

              So, what should be done with the starving people that don’t have a stockpile of food and ability to produce their own food? Should they be allowed to cause the irradiation of the entire planet?

              None of this is certain. If A happens, B might happen, and B has a chance of causing C. If there is no way to prevent A, what should we do about B, to avoid C?

            • Fast Eddy says:

              Of course they won’t all survive — I don’t think any will survive.

              No food — well… technically if some decided to eat the others they could survive for awhile … however there will be no way to keep the meat fresh so that is not much of a solution …

              No way to keep spent fuel ponds from blowing up.

              Extinction event.

        • Fred says:

          The circumstances are ugly and probably culminate in a worst case scenario. Can’t blame others for varying degrees of cognitive dissonance in this context, but appreciate those, like yourself, who tirelessly apply intellect and humor to the cause of alerting folks. I don’t label your writings as “negative”. Instead, they help me better appreciate what I have right now….in this moment….reminding me not to waste a minute of whatever time I may have left. You’ve successfully scared me into that mindset!

          • Fast Eddy says:

            Most definitely — there’s nothing we can do so enjoy what’s left…. rather than worrying or spending time thinking about solutions when there are none….

            In fact I have dedicated this month long Europe trip to that purpose…. and I’m burning through my End of Days Travel Fund 🙂

            Although now that we are clear of the holidays I’m having to get up in the middle of the night to deal with work emails out of Asia so I am still running with the hamster….

            • psile says:

              Stock markets are making some very wild gyrations again, especially the Chinese. How much longer can it all hold, before something really snaps?

              Stocks Resume Rout After Massive Chinese Intervention Fails To Lift Shanghai, Calm Traders

              After yesterday’s historic -6.9% rout in the Shanghai Composite, which saw the first new marketwide circuit breaker trading halt applied to Chinese stocks (on its first day of operation), many were wondering if the Chinese government would intervene in both the once again imploding stock market, as well as China’s plunging and rapidly devaluing currency. And, after the SHCOMP opened down -3%, the government did not disappoint and promptly intervened in both the Yuan as well as the stock market, however with very mixed results which global stocks took a sign that the “national team” is no longer focused solely on stocks, and have resumed selling for a second consecutive day.

      • hkeithhenson says:

        “Simply, the western people unlearned that to expect several deep impacts through one’s life is quite normal on this planet, e.g. regime change, destruction of currency, wars, loss of family members.. , even taking hit several times per century is somewhat normal.”

        That’s true. Over a generation the population of even primitives rises enough so that a weather glitch drops the ability of the ecosystem far enough to get famine.

        “Or does it really matter the highway system will be largely defunct as local food system takes over, so surviving people don’t have to commute daily etc. etc.?”

        It matters. The main reason we don’t have famines is transport that allows shifting food from one area to another.

        • Pls. read it again, I specifically talked about post crash survivors and emerging local food economy, i.e. situation years after the fact with way smaller population and “consumption” patterns..

        • “It matters. The main reason we don’t have famines is transport that allows shifting food from one area to another.”

          That seems to me to be the keys to the success of the Roman Empire. They secured Spain, Sicily and Egypt as additional sources of wheat, and cleared the Mediterranean of pirates and other threats so they could shift food as needed and avoid famine.

          Unfortunately, they did not master population control, even with (allegedly) a highly effective means of birth control.

          • xabier says:

            Exactly. Reading recently about the Roman Empire under Augustus, I was struck by the comment of a merchant of the time to the effect that the great benefit conferred by Augustan Rome was peaceful and secure communications after decades of piracy and insecurity – who needs liberty when you can trade?

            As the Empire weakened, banditry – often on a very large, regional, scale – returned. One can observe the effect today when, say, the police go on strike in Argentina and all the low-life know that calls won’t be responded to.

            The next stage is when the law-enforcers are themselves the bandits, or covering for them: Pakistan, Iraq, Afghanistan, take your pick.

            • Great post, unfortunately many here still don’t grasp what this dynamics means for the future, i.e. high probability of staircase fashion collapse into beyond 3rd world niveau instead of overnight insta-doom ends of the world fantasies..

          • psile says:

            “Unfortunately, they did not master population control…”

            Err, this is a continuum problem since humans as animals are just doing what comes naturally. Reproduce like crazy when the conditions are right. Which has been the case for our species ever since we discovered the practical use of fire and even more so with the harnessing of fossil fuels. Shame that the “flame” is about to go out sooner, rather than later. But hey, that’s life! It’s been a good run… 🙂

  10. Fast Eddy says:

    The Plunge Protection team is ON IT!

    A funny thing happened at 1101ET. Amid the deep plunge in stocks, ‘someone’ suddenly traded an enormous block of e-mini S&P futures which appeared to stall the sell-off (for now). This followed a similar (but smaller) block trade at 1042ET which also extracted all the liquidity from the market momentarily and enabled a brief rally.

    That is twice we have seen a big block followed by a rally in futures…




  11. Fast Eddy says:

    So today it was Prague Castle day….. quite impressive….

    3 take-aways:

    Starvation: I was paying close attention to an exhibit about food production and consumption … back in the day in times of bountiful harvests there was always fear of famine being right around the corner —- and they stored large amounts of food when possible — yet in spite of this there was frequently not enough during hard times…

    – the population was a fraction of what it is now
    – all land was farmed organically
    – all people would have known how to farm

    And STILL they STARVED.

    – today less than 2% of land if farmed organically
    – populations are huge
    – people believe food comes from a grocery store

    The Grandmother of all famines is headed our way.

    Child Mortality – if I recall correctly one of the monarchs had 8 children — 4 died as infants. The monarch would have the best of the best of care and food available back then….

    Torture Chamber — this was no Tussaud expo — they had the real gear in the tower with graphic descriptions… there was no Koombaya then — and there will be no Koombaya going forward.

    • That’s a valid observation.

      However, there were more factors and motivations at play historically speaking. For easy illustration, lets say you are a smallish scale nobleman, you are living from 5-10 villages including fields, cattle, forests, basic manufacturing like metals/textiles, mills, bakeries, sheep etc. Your subjects have to exclusively store grains in your one and only central or perhaps even 2-3x multi-storied granariums around your dominion. Now, you have some active and sometimes pressing “business” relationships, perhaps you are renovating your chateaux and also in the middle of building a new one for your son, so you have debts. Moreover and on top of the debts here comes bad harvest season or the region/country is suddenly at war, decisions-decisions what to do with the stored valuable grains? Well, in the end you can always screw your subjects a bit and deny them the food to some extent, the scale depends on how you deal with your people and how are you successful as latifundist..

      You see, there were huge day/day or y/y spikes back then, today’s system seems smooth as silk for now..

      • xabier says:

        Earlier societies had -and have- mechanisms for handling food shortages in the best way for the whole group without descending into a murderous general struggle.

        For instance, take the rather fierce tribesmen of Pakistan, when food is short, the rationing is as follows (as far as I have been able to discover):

        Priority: adult males, as near to a full meal as possible. Reason: they farm and fight and raid, so without them land is lost and the whole group can go down. They can also make babies any time they like through a comparatively long life – if you are good at the above, women for breeding can always be obtained.

        Second: strong, fertile women, and maybe boys on the verge of being able to fight, both valuable for obvious reasons. They get reduced rations.

        Third: women past child-bearing, all other children male or female. Due to high child mortality, the children could prove to be a poor investment, and old women have a diminishing value in every respect. Poor prospects.

        The unit which this customary system seeks to preserve is the clan/tribe, not primarily the individual. Everyone knows the rules.

        • Fast Eddy says:

          I forgot to mention … the info in the Prague Castle mentioned that people ate dogs… they cut down bodies from the gallows and ate them… and so on….

          The famine that is coming makes the famines of the past look like a skipped meal by comparison… this famine is going to be global — no food drops… no Bono concerts….

          Just 7,5B people — and virtually every scrap of soil on the planet ruined with chemical based fertilizers that won’t be available….

          Extinction. Virtually guaranteed.

          • MJ says:

            Sounds much like a likely maybe.

          • Christian says:

            This in an interesting ethnocentric use of the word “extinction”, because it assimilates the disappearance of a culture to the disappearance of the species. It is remarkable that Guy Mc Pherson uses the word too, while as a biologist he knows pretty well that if a hundred thousand of individuals survive it is not an extinction (perhaps an endangered species). And he must know there still are a hundred thousand or more HG at the present moment in the planet (only in Argentina they are estimated to be some ten thousand, which are located 700 miles away from the nukes).

            • Van Kent says:

              Guy McPherson is in the +17C (that number is from Dmitry Orlovs blog) camp. Abrupt climate change outside of any possibility to the ecosystem to adapt to the changes. In other words extinction.

              Paul Beckwith has studied ancient climate variations, and the northern hemisphere is capable of warming or cooling +/- 6-7C within just a few years. But the southern hemisphere? Don´t know if something like that is possible in the southern hemisphere.

              In the long-long run oceans will rise, Greenland and etc. will melt. But to have +17C (more than can be adapted in any kind of circumstances) before 2030 seems a bit fast for a global system that apparently needs four decades to warm from current emissions.. I don´t understand how Guy makes those two maths match?

              But if all the feedbackloops (all of them) work in the wrong direction, then Guy is right, only that its 2230 when extinction hits (I think we will get some extra time with walipinis in Norway and NZ). The problem with extinction is of course that it only have to hit one time, a 100% population reduction is difficult to bounce right back up from.

              Anyways, death or extinction will not feel any different when starvation and virulent strains begin to hit us within a year or two.

            • Christian says:

              Ah… it’s based on the climate stuff… I’ve heard he sustained our dilemma is to power off the nukes and crash the economy or to get them on till the financial crash and see them go bang. The climate stuff… I can’t say a word on this, just that +17C sounds incredibly high (and that climate prediction has always been highly speculative)

              Southern hemisphere… less landmass, any consequences?

              It’s true we’re rather dead anyway, but I feel better believing at least HG will go on

    • DJ says:

      Doesn’t Prague have a Torture museum close to karlows bridge?

      • Fast Eddy says:

        Not sure – the one I went to was in the old prison tower in the castle.

        • MJ says:

          Wonder if they will open a torture museum in Baghdad ?



          We need not look at the Medieval Age for this to reoccur because it has never ceased,
          The Nazis, Soviets and now condoned and encouraged by the highest levels of United States executive branch (Dick Cheney)

          • Fast Eddy says:

            Ha ha — excellent!

            If the Germans had won WW2 Auschwitz would have been turned into a low income housing project…..

            The winner writes the history …. and the losers get charged with war crimes and a few of them are hung….

            • MJ says:

              Difficult to speculate regarding “what ifs”. The point I was making regarding your post, Fast Eddy, is we humans have displayed remarkable capability as far discovering how the world “works” (thank you Don Stewart for all the proof we need ) and yet still have hardly taken one step in the mind/psyche realm of right relationship.

  12. Stilgar Wilcox says:

    Here’s new information from zerohedge on China – They halted their Stock Market after 7% drop!

    Following the initial halt in CSI-300 Futures at the 5% limit down level, the afternoon session opened to more carnage and amid the worst ‘first day of the year’ in at least 15 years, Chinese stocks collapsed further to a 7% crash. At 1334 local time, stock trading was halted for the rest of the day across all exchanges (at least two hours early).

    The DOW premarket is currently set to go down 150. Not too bad but there’s plenty of time between now and when it opens.

    • richard says:

      The stock market halt was preceded by a slowdown in Electricity consumption:
      “In the first eleven months of this year, the country consumed 5,049.3 TWhs of electricity, up 0.7% than in the corresponding period of last year.”
      And if rural and urban residential consumption is up 4.5% something has to fall:
      “The power consumption of the secondary industry was 3,633 TWhs, 1.1% lower than a year earlier.”

    • Fast Eddy says:

      Yoo hooo… plunge protection teams….. the holiday is over…. time to get back on the job….

    • WSJ headline: “Global Stocks Slide after rout in Chinese market.”

      • Stilgar Wilcox says:

        My observation of the US stock market after watching it for many years is in the past it has been the leader of other stock markets around the world, i.e. it tended not to pay much attention to what other markets were doing. So when I read China’s stock market was down by 7% I immediately wondered what effect it would have on the US market. Well, I suppose times have changed because the Dow is down well over 300 pts.


        • Fast Eddy says:

          Actually … this has happened before:

          From October 2006 to October 2007, the Shanghai Composite Index more than tripled in value. It was the greatest stock market surge in Chinese history. But after hitting a peak, it began to fall dramatically. From October 2007 to October 2008, the Shanghai Composite Index absolutely crashed.

          In the end, more than two-thirds of all wealth in the market was completely wiped out. You can see all of this on a chart that you can find right here.

          What makes this so important to U.S. investors is the fact that Chinese stocks started crashing well before U.S. stocks started crashing during the last financial crisis, and now it is happening again.


  13. Don Stewart says:

    Stilgar Wilcox
    For example, see interview with Stuart Newman…Don Stewart

    Stuart Newman: I fully agree that terms like genetic program and blueprint are wrong. I’ve been writing about this for more than 30 years. But “gene” as I use it refers to a nucleic acid sequence that specifies a protein sequence. I don’t think you will find any biologists who disagree with this usage.

    Concerning the role of horizontal or lateral transfer, since evolution occurs in stages and at each stage there are new phenomena that emerge, it may be that some of these novelties arise when a new gene or pathway is brought in laterally by a virus. We know from developmental biology that changes in form, some rather abrupt, take place when new proteins appear that can mobilize physical forces that cause cells to rearrange. Presumably that’s how many morphological novelties arose during evolution as well.

    Luis Villarreal says that “if living systems work by these processes that are consortial and complex, then our very language and logic are a problem in terms of how we apply it to understand what’s going on.”

  14. Don Stewart says:

    Dear Finite Worlders
    Pretty frequently someone here blames everything on their DNA. For a healthy dose of correction applied to simplistic DMA-based explanations, see Susan Mazur’s blog:


    You can kill a couple of hours clicking on the various interviews. As a sort of summary, I note the following quote….Don Stewart

    Günther Witzany: The older concepts we have now for a half century cannot sufficiently explain the complex tendency of the genetic code. They can’t explain the functions of mobile genetic elements and the endogenous retroviruses and non-coding RNAs. Also, the central dogma of molecular biology has been falsified — that is, the way is always from DNA to RNA to proteins to anything else, or the other “dogmas,” e.g., replication errors drive evolutionary genetic variation, that one gene codes for one protein and that non-coding DNA is junk. All these concepts that dominated science for half a century are falsified now. . . .

    • Stilgar Wilcox says:

      Don, can you paraphrase why it is now falsified?

      • Don Stewart says:

        You will have to read the various interviews to get a broad view.

        I’ll give you my layman’s guess at what went wrong. Darwin started with some finches. If he had started with the invisible world from which the finches sprang, he would likely have formulated a very different theory. We may all be the descendants of fragments of RNA that we call viruses. The bacteria laterally transfer genes with abandon, and our notions of ‘species’ don’t apply very well (although we still try to use the language). Remember: the microbes are dominant when it comes to genes…there are a dozen or so phyla of genes while all vertebrates fit into a singly phylum.

        If you begin with viruses and bacteria and fungi and lateral shuttling of genes, I don’t think you end up with finches beaks as being the foundation of your theory.

        Don Stewart

    • MJ says:

      Don, I am struck mostly on how limited knowledge really is! Yet we worship it and place it at the center of our society. No matter what we humans are capable of discovering, it will never be the whole, but fragmented. With this division stems the conflict and disorder we call our lives, society and so called civilization.
      So, Gail can add another “finite” to the title of her webpage.

    • pintada says:

      Yup, thought so:


      Call me old fashioned, but when I read science I always check the background of the individual doing the writing. For example, if I want to know about AGW, I read James Hanson, PhD. It isn’t the advanced degree that is the clincher for me while it is a necessary beginning. I like to see decades of actual experience doing the actual science.

      • Don Stewart says:

        I am well aware of that article. That is why I suggested that people spend some time reading. They can make up their own minds.

        From everything I can see, it is clear to me that, as I said, if Darwin had known about and started his theorizing from microbes rather than finches, he would have developed a very different theory.

        That doesn’t mean that selection NEVER happens as Darwin thought, it just means that the situation is a lot more more complex than Darwininian fundamentalists think it is.

        As a speculative matter, it may be worth noting that scientists have observed that complexity seems to require rigidity. Viruses and bacteria can swim in a world where genetic material is floating around pretty freely. But when you get to complex creatures such as vertebrates, you start seeing recurrent patterns that lead you to use language like ‘species’ to mean something pretty fixed. And it is the fixed species that tend to go extinct over time. The more flexible bacteria have been around for billions of years. If you want to speculate about human culture, you would probably think that the more specialized and complex the culture becomes, the less likely it is to survive challenges.

        Don Stewart

        • kesar0 says:

          “the more specialized and complex the culture becomes, the less likely it is to survive challenges”

          I don’t believe it’s so simple. Ants are present for 150 million years on this planet. And they are one of the most “specialized and complex culture” in our biosphere.

          • Artleads says:

            “If you want to speculate about human culture, you would probably think that the more specialized and complex the culture becomes, the less likely it is to survive challenges.”

            Intuition again. I do lean this way myself, while admitting that I have little understanding of the “contrary” point made by kesaro. Maybe they aren’t really contradictory…if one studied the issues at greater length.

            • kesar0 says:

              Even in anthropology you have many examples of tribes and nations (which are in fact models of culture) exterminated due to their lack of complexity. Tribes not strong or aggressive enough to fight military raids of their neighbours. Different strategies of survival were successful in human history. There are no easy prescriptions.

        • Artleads says:

          “That is why I suggested that people spend some time reading. ”

          This could be a poor example of something which the thread brings up. But I’ll try it anyway.

          Less specialized and complex cultures might meet challenges better. (And I’m not trying to be argumentative). One way to look at non specialization (if not complexity–there’s a telling difference between “complex” and “complicated”) is that everybody becomes a Renaissance “man.” The single individual can do everything, ergo, the single individual studies and reads. This has confusing implications for complexity and specialization.

          Somewhat related is my intuitive conviction that our predicament is largely a product of both specialization and individualism. I would like to be valued for my imagination and intuition, which are very developed. I would like these qualities to be of equal value to reading. Not everybody reads well, or enjoys reading. So, can we “reward” the readers to read for them? And can we likewise reward the intuitives who don’t read? In other words, can we at least give equal weight to imagination as we give to knowledge? So where does collectivity fit into all of this? And if we are to think collectively in as how different proclivities can be valued and used for the collective, what does that say about specialization?

          The ants may be doing individual tasks that require specialization, but they are doing it for a highly collective purpose. Meanwhile, each ant transporting a single blade of grass is individualist and collective simultaneously?

          • Artleads says:

            This (on NBL today) sort of speaks to what I just shared:

            “Regarding the western worldview and its effect on the world, I think it’s the lack of balance more than anything else that has caused the problems. It’s interesting to see now that even left-brained science is starting to question some of the fundamental tenets of science, such as replicability of experiments, physical constants, but even going back to the beginning of the 20th century, quantum physics was pointing out to anyone paying attention that reality is a heck of a lot more mysterious than we’ve generally realised. It’s strange that our culture is still stuck in the Newtonian mode, rather than embracing what’s now an over a century old story of reality. Anyway, the materialist paradigm has produced some extraordinary things, but our collective complete rejection of anything but that paradigm is more problematic than the basic idea, I think. It’s proven to be an extremely useful way of looking at the world, but the wholesale denial of any other way of seeing the world has meant that we’ve focussed absolutely on the left-brained, male-dominated viewpoint, and completely denied the intuitive, holistic understanding. I’ve read suggestions in the history of science that this happened because when science finally did manage to overthrow the church as our dominant paradigm, it felt the need to constantly bolster its own viewpoint lest we return to witch trials and inquisitions, and that now we’re seeing the results of that one-pointed view.”

            • Fast Eddy says:

              ‘holistic’ — that immediately makes me think of organic granola, hippies sharing a loaf of bread and peanut butter, faith healers…. and of last but not least


              Since we harnessed fire we have been progressing along a path that is unsustainable — and now we are at the end of that road.

              Now if you want to suggest we return to hunter gatherer days pre- harnessing of fire then yes — there is another viable, sustainable system.

              Strange how so much time is wasted on other systems — and nobody wants to talk about the obvious and only one that makes any sense.

              Why might that be?

          • Don Stewart says:

            Dear Artleads and Others
            Two comments. First about science and reductionism and other topics. See this TED talk:

            The world is a very strange place.

            Second comment has to do with complexity and fragility. I have read textbooks on Systems Theory which tried to define ‘complexity’ and left me completely unconvinced.

            Let’s consider a nesting pair of birds. The male doesn’t went to waste his energy feeding some other male’s children. But Mrs. Bird is quite promiscuous. So Mr. Bird expends a lot of energy trying to keep other males away from Mrs. Bird. Now consider that the birds call a Constitutional Convention and make up some laws about monogamy and what happens to bad birds and appoint a Chief of Police and hire policemen and fly drones around the sky looking for birds who have sinned.

            Would you consider the new society more or less complex than the old society? Can you explain exactly why you think as you do?

            I am not sure there is any simple definition of complexity. But I do think that a society which is thermodynamically inefficient is probably more complex than one which is thermodynamically efficient. For example, there was an article yesterday at Resilience.org lamenting the inefficiency of burning natural gas for low heat purposes such as space and water heating. Space and water heating are easily accomplished with passive solar, so it is wasteful to use a dense source of energy like natural gas to do the job. As a first approximation, I would say that a society which uses natural gas for space and water heating is more complex and thus more fragile than a society which uses passive solar. Kris DeDecker has an article at Resilience.org today outlining the difference between glass greenhouses and Chinese passive solar greenhouses. The same logic holds.

            Also, consider two societies. One is a man and a dog out hunting birds. The man is doing what he wants to do, and the dog is doing what he wants to do. There is enormous synergy between them. Contrast with a man and a mule plowing. Neither is doing what they want to do. The agricultural combination can only be held in place by some pretty strong repression. I would say that the hunting pair is a lot more resilient than the agricultural pair. And, indeed,, getting kicked by a mule used to be one of the more important causes of death.

            Or think about the Mayan civilization. The cities dissolved into the jungle, but ancient Mayan agricultural methods still survive today. You can study them at the Organic Growers School in Asheville, NC come March. The city part of the civilization was complex and failed. The agricultural part of the civilization was either complex or simple, depending on how you look at it, and survived. But the agricultural system used network principles and relied on taking advantage of the natural course of succession. Are lots of plants and animals doing what they naturally do more or less complex than a monoculture which has to be held in place with enormous expenditure of energy?

            I’m not trying to give a universal definition of ‘complexity’. Merely to hint at some of the things I think would have to be encompassed in a definition.

            Don Stewart

            • Van Kent says:

              Thanks Don, my take on complexity is that jacks of all trades are masters of none. And our society is built so that a brain surgeon or an eye surgeon is not practicing, he knows what he´s doing. An eye surgeon once told me his profession can´t be practiced in any meaningful way, the first twenty or so patients are at risk, but it can´t be helped, a new eye surgeon must learn his craft nonetheless. But after the twenty or so, he can treat thousands following with precision.

              I could probably fly as co-pilot in an commercial airline, but my reactions would be wrong or too slow in an crisis situation, resulting in a crash if even the slightest thing went wrong during the flight.

              We specialized, we become fast, accurate, safe and productive in our fields of expertise. Next we become jacks of all trades again, and masters of none, wouldn´t be going to an so called “eye surgeon” a few years after BAU collapses.

              How would agriculture have more or less complexity? Weather changes, when difficult times hit, the farmer who knows and can implement options can grow a bigger harvest. And maybe a few years from now a somewhat bigger harvest is the difference between life and death.

            • ” An eye surgeon once told me his profession can´t be practiced in any meaningful way, the first twenty or so patients are at risk, but it can´t be helped, a new eye surgeon must learn his craft nonetheless. But after the twenty or so, he can treat thousands following with precision.”

              It seems odd to me that they couldn’t make artificial eyes specifically for practising eye surgery on. They can make pretty realistic replicas of whole humans for movie and television, including cross sections. It seems to me it would be worth it to spend a few thousand doing a couple dozen practice runs first.

            • Artleads says:

              “I’m not trying to give a universal definition of ‘complexity’. Merely to hint at some of the things I think would have to be encompassed in a definition.”

              I don’t know either how to think about complex/complicated. A scientist on NBL, sometimes using the name “Ram<" went into detail about it. But this is where my aversion to research (to even begin to consider how to search the archives.) is limiting.

              I think that complex can equate with elegance somehow, while complicated cannot.



            • Van Kent says:

              Matthew, something to do with muscle movements and reactions, that computer simulations or artificial eyes in med schools can´t duplicate. But after having the initial twenty or so, the eye surgeon beocomes fast and reliable within his very limited field of expertise.

              Don, Complexity; A system where the amount of information processed by the whole system is greater then any one individual can process, thus creating dependancy between independent expert individuals. And complexity is increased when the amount of processed information, including created by the interdependent independent web itself, is increased.

            • Artleads says:

              At a local community meeting recently, I got a strong intuitive sense that the abstract way in which the meeting went was wrong. Robert’s Rules, abstract goals, etc., that act as though everyone there was the same. This struck me as a indicative of a lack of trust in the individual to get work done. What, instead, if each individual was asked what they wanted to do and see done? (The odd thing is that this is supposedly the underlying principle of the meetings, but there is missing the idea of the individual’s soul.) So, instead of saying that such and such a program was the group’s, why not say that the program is Joe’s or Mary’s? Then all these individuals’ projects could be arranged within a matrix so as to see how Joe’s plan could help Mary’s, and vice versa. There would be greater onus on individual responsibility, perhaps? And if so, what bearing would that have on the complexity issue?

            • Don Stewart says:

              I have always thought that what you suggest is the best and most long-term stable way to get things done. It’s like the hunter and dog analogy I used…both doing what they want to do, synergistically.

              I worked long enough in corporate America to see fashions come and go. There were times when decentralization and empowerment were in fashion, and times when micro-control from the top was in fashion. Neither approach is without its drawbacks.

              The decentralization and empowerment model is less complex in certain circumstances, but it can also get more complex if everyone doesn’t really share the same goal. The ‘network’ dissolves into infighting. The top-down moro-management model starts out complicated and usually becomes complex. Many people have observed that the way to bring an organization to its knees is to follow the book.

              Don Stewart

            • Van Kent says:

              My understanding of great leadership is a guy who can motivate individuals and give individuals great reasons to get motivated. I find such leaders of men rare though.

              The best boss I ever had, told me when my now ex-wife was having a miscarriage, “Ok, now, take care of her, it take as long as it takes, don´t mind the business, now concentrate on her, bye” I was like wow, with one short phonecall he took all my responsibilities, no mind the laws, rules, regulations or quarterly goals, and gave me carte blanche. After that, it was no problem for me to make a few multi million contracts for him.

              Now when I have to lay somebody off, or leaving the negotiation room after instructing some team, I try to emulate him, give a brief recap what my personal responsibility is, and what each member has as a personal responsibility from thereon in, making it understandable, relatable, personal.

    • Christian says:

      Good comment on genes, Don. Reg. complexity, I found Tainter’s definition to be a good one:

      “Complexity is generally understood to refer to such things as the size of a society, the number and distinctiveness of its parts, the variety of specialized social roles that it incorporates, the number of distinct social personalities present, and the variety of mechanisms for organizing these into a coherent, functioning whole. Augmenting any of these dimensions increases the complexity of a society. Hunter-gatherer societies (by way of illustrating one contrast in complexity) contain no more than a few dozen distinct social personalities, while modern European censuses recognize 10,000 to 20,000 unique occupational roles, and industrial societies may contain overall more than 1,000,000 different kinds of social personalities”

      More parts, more types of parts and more type of links: more complex
      Complicated: just something too complex for X to understand it
      Complexity is objective, it can be measured. Complicatedness is subjective, it can’t be measured.

      This way, modern monoculture is indeed more complex than Mayan ag, because it requires not only the participation of some hundreds of types of things, mainly living beings (humans, plants and all our micro friends), but of millions.

      I see also your introduction of the thermodynamic element in the definition as interesting, and Tainter is somewhat going the same path: more parts means higher energy density, and so more wastefulness (HG doesn’t waste much)

      And I understand your point reg. the mule and the farmer vs. the dog and the hunter, but we must keep in mind the hunter won’t be happy if he can’t find enough food this way and his farmer neighbor does get it in a small piece of land. As Tainter also said, complexity can feed more people but it is also more wearisome, because (and this is my idea) specialization requires a more stereotyped behavior

  15. Fast Eddy says:

    The plot thickens….

    Until recently healthcare had been the only sector offering any optimism from an earnings perspective but even that has collapsed now. The three-month earnings revision ratio (ERR) fell for the fifth month in a row to 0.53 from 0.55 – its lowest level in nine months, indicating twice as many cuts as increases. As BofAML notes, this is well below the long-term average of 0.84, and given S&P 500 sales revisions have collapsed to April 2009 lows, they forecast more cuts are likely to come… and a muted January effect looms.

    S&P 500 Sales Forecast Revisions are the worst since April 2009…




    More http://www.zerohedge.com/news/2016-01-02/earnings-revisions-tumble-weakest-9-months-bofaml-warns-more-come

  16. Fast Eddy says:

    Speaking of cats and mice…

    Hungry rats are put into the cage and they eat their way through the live body of the torture victim…

    We humans are so innovative!


    • MJ says:

      Fast Eddy, we humans are innovative and perhaps need to examine the flip side of the coin. Does a sane, rational person have a “choice”? That is one question Jiddu Krishnamurti posed. If torture is insane and irrational (suppose war can be put in that category), is there a choice? For a sane and rational person the only option is not to participate. Also, regarding what we eat, if factory farming and the like causes severe torture (distress), we would find other ways to feed our bodies.
      As written here in past comment, some life forms die and are consumed by others to exist.
      That is a fact. Another fact there are degrees of development among creatures, and we have a choice in that regard. So, either consuming fruits and vegetables along with plants that exist in a manner to be consumed to spread seeds, or set up these concentration camps of chicken, pig and cattle. A sane rational individual would find the former the only. BTW, that would aid in the reduction of obesity discussed here also.
      Now, before you shout Koombaya, forgive me as I point out perhaps humans and the society we create is perhaps insane and irrational (maybe not intelligent depending on your definition) and what we are facing in regard to collapse is the result of that condition. For if we were intelligent, sane, rational beings surely things would have not come to this point. One only needs to view the pictures of the above digital book, Overshoot, as proof.
      So, what I am really pointing out here is asking the right questions is the key. The other key is to not jump to conclusions and end the enquiry….but always keep an eye open and be alert.

      • Fast Eddy says:

        I do not think there is a choice. Mr DNA chooses. If we torture each other and keep animals penned in atrocious conditions — this leads back to the drivers of survival and procreation — and survival of the fittest.

        The thing is….

        I wander between positions of nihilism and misanthropy …. if I had to choose it would be the latter … nature’s mistake … a monstrous freak show…. a aberration….. best if we were extincted.

        • MJ says:

          What you are really inferring as far as Mr DNA is programming or in the realm of psychological field “conditioning” or something to that affect. Now, this is really not the forum to address that serious, urgent inquiry and with respect to Gail, not pursue it other than provide a link for Fast Eddy to do so himself and consider the possibility of non programming or what is termed “enlightenment”.
          That will provide a Fast Eddy a worthwhile inquiry.
          DB: Not only physicists hut geneticists, biologists, have tried to reduce everything to the behaviour of man – atoms, genes, you know, DNA molecules, and so on. And the more they study it, then the more they feel it has no meaning, it is just going on. Though it has meaning physically, in the sense that we can understand it scientifically, it has no deeper meaning than that.

          K: I understand that.

          DB: And, of course, perhaps that notion has penetrated because in the past people were more religious and felt that the ground of our existence was in something beyond matter – God, or whatever they wished to call it. And that gave them a sense of deep meaning to the whole of their existence, which has now gone away. That is one of the difficulties of modern life, the sense that it doesn’t mean anything.

          K: So have the religious people invented something which has a meaning?

          DB: They may well have done so. You see, feeling that life has no meaning, they may have invented something beyond the ordinary. Something which is eternal…

          K: …timeless, nameless.

          DB: …and independent, absolute.

          K: Seeing that the way we live, genetically and all the rest of it, has no meaning, some clever erudite people said, `We will give it a meaning’.

          DB: Well, I think it happened before that. In the past people somehow gave meaning to life, long before science had been very much developed, in the form of religion. And science came along and began to deny this religion.

          K: Quite. I understand that.

          DB: And people no longer believe in the religious meaning. perhaps they never were able to believe in it entirely anyway.

          K: So, how does one find out if life has a meaning beyond this? How does one find out? They have tried meditation: they have tried every form of self torture, isolation, becoming a monk, a sannyasi and so on. But they may also be deceiving themselves thoroughly.

          DB: Yes. And that is in fact why the scientists have denied it all, because the story told by the religious people is no longer plausible, you see.

          K: Quite. So how does one find out if there is something more than the mere physical? How would one set about it?

          DB: We have been discussing the notion of some ground which is beyond matter, beyond the emptiness.

          K: But suppose you say it is so, and I say that is another illusion.

          DB: The first point is, perhaps we could clear this up: you see, if this ground is indifferent to human beings, then it would be the same as scientists’ ground in matter.

          K: Yes. What is the question?

          DB: Is the ground indifferent to mankind? You see, the universe appears to be totally indifferent to mankind. It is immense vastness, it pays no attention, it may produce earthquakes and catastrophes, it might wipe things out, it is essentially not interested in mankind.

          K: I see what you mean, yes.

          DB: It does not care whether man survives or does not survive – if you want to put it that way.

          K: Right. I understand the question.

          DB: Now I think that people felt that God was a ground who was not indifferent to mankind. You see, they may have invented it, but that is what they believed. And that is what gave them possibly…

          K: …tremendous energy. Quite.

          DB: Now I think the point is, would this ground be indifferent to mankind?

          K: How would you find out? What is the relationship of this ground to man, and man’s relationship to it?

          DB: Yes, that is the question. Does man have some significance to it? And does it have significance to man? May I add one more point? I was discussing with somebody who was familiar with the Middle East and traditions of mysticism; he told me that in these traditions they not only say that what we call this ground, this infinite, has some significance, but that what man does has ultimately some significance


    • xabier says:

      What I find truly disturbing is that someone went to the trouble of making that dummy and rat set-up in their basement (see the non-medieval plumbing in the background)……

      • Fast Eddy says:

        There is a business similar to Tussaud’s Wax gig that focuses on torture …. I’ve seen them in tourist areas in come European cities and towns…. they reproduce the torture devices and display them…

        I’ve been through one and it was actually pretty fascinating — in a macabre way…..

        I assume that was from one of those exhibits….

  17. Stilgar Wilcox says:


    ‘Iran says boosting oil exports depends on future demand’

    “A rise in Iran’s crude oil exports once sanctions against it are lifted depends on future global oil demand and that should not further weaken oil prices, a senior Iranian oil official was quoted as saying.

    Oil prices are likely to come under further pressure this year, when international sanctions on Iran are due to be removed under a nuclear deal reached in July. Brent crude LCOc1 settled at $37.28 a barrel on Thursday.

    Iran has repeatedly said it plans to raise oil output by 500,000 barrels per day post sanctions, and another 500,000 bpd shortly after that, to reclaim its position as the Organization of the Petroleum Exporting Countries’ second-largest producer.”

    Iran has for years had a competition with Iraq for #2 OPEC oil producer so you can be sure they won’t hesitate even with low oil prices to once again assert their market share. If there’s any chance of oil prices dropping into the twenties, that’s it, which would further risk future supply due to a lack of exploration.

  18. Stefeun says:

    In an attempt to improve my knowledge about finance, I made some research and found 2 documents I think are worth sharing.
    The first is a presentation that summarizes the basics about commodity markets (futures (OTC) and forwards) and an analysis of the 2008 food crisis:

    “Financialization of Agriculture Commodity Markets and Price Volatility”
    Next lesson will be about futures index-linked to interest rates, Swaps and CDS (just kidding).

    The second is a paper that surprised me, as it describes the Dojima (Osaka) rice market in the early 1700s as being the first organized futures market (the Tulip Mania one century earlier was only a one-shot speculative bubble).

    “The Dojima Rice Market and the Origins of Futures Trading”

    It’s a pleasant read that gives many details about the reasons and means of such development, and changes in society (see also the part about importance of fast long-distance communication, that reminded me HFT).

    Unfortunately, it doesn’t much develop the topic of connected risks (price spikes and bubble busts) and the several famines and riots that happened in this period.
    The period studied by the paper ends in 1730, date at which “Osaka merchants petition the shogun to authorize them to establish a new Dojima Exchange at which futures transactions would be permitted.”

    One example is cited (e.g. in this other book, see p.303: https://books.google.fr/books?id=Aw1ZEdb5fp0C&pg=PA303&lpg=PA303&dq=dojima+1749+rice&source=bl&ots=oXLI_qCte7&sig=x4DIYOsnIwJ1ql-q-0WjvxD-Ydg&hl=fr&sa=X&ved=0ahUKEwiljanvx4vKAhUHnBoKHdVpB1QQ6AEIHzAC#v=onepage&q=dojima%201749%20rice&f=false)
    about the year 1749, in which “bills in circulation represented more than 110,000 bales of rice, whereas the inventory at that time only amounted to 30,000 bales. That is to say, the outstanding balance of rice bills represented almost four times the actual quantity of rice available for physical delivery”.

    Besides the financial topics, this passage (page 3 of the paper) draw my attention:

    “Edo grew from an insignificant settlement in 1590 to a huge city of over a million residents by 1720, when it was probably the largest city in the world.12 The Japanese scholar Eijiro Honjo describes the consequences of this urbanization:
    ‘With the development of urban districts, the chonin [merchant/artisan] class gained increasing influence, and the currency economy made so much development as to challenge the supremacy of the land economy. That is to say, a new economic power, viz., the money power of the chonin class, sprang up, besides [sic] the agricultural economic power. Due to this remarkable economic change, it became impossible for the samurai class to maintain its livelihood under the old economic organisation. Nor was it any longer possible for the farmers to support the samurai class. In such circumstances, samurai finally bowed to the new economic power. They either besought the financial help of chonin or turned chonin themselves. On the other hand, the chonin class gained considerable influence in society by means of its money power.’ ”

    It means that the direct cause for take over of the power by merchants from the traditional feudal rulers would be directly linked to urbanization.
    And therefore indirectly to the increase of population density.

    That seems to make sense, as similar pattern can be found in different locations. It also helps understand the major shift that happened in our civilisation(s) at the end of the middle-ages.

    • Stefeun says:

      Also came across Irving Fisher’s theory of Debt Deflation. Interesting.

      • ejhr2015 says:

        As well as those, may I suggest you read the links I gave to Gail?
        To repeat, this “theory” discusses what is the real economy not something dreamed of in academia. Criticism of mainstream economics – as explained by the Austrian and Chicago schools – points out it is far removed from reality. Read up on it and before too long you’ll suddenly “see” it when the penny drops. You only have to have an open mind, something FE gave up on.
        Functional Finance by Abba Lerner is another useful read. Even Ben Bernanke admitted tax dollars are not used for government spending.

        • Stefeun says:

          MMT has already been discussed here a couple of months ago (look for John Doyle’s comments) and rejected as being akin to perpetual motion machine. Maybe I’m exagerating with this tough formula, but this was also my feeling as I tried to understand the theory and had to give up for lack of understanding.

          WRT perpetual motion machine, I take advantage to mention Frederick Soddy, the most visionary economist (he was a chemist) of the 1920s, in my view:

          “Mr. Soddy’s Ecological Economy”
          By Eric Zencey, April 11, 2009

          • Thanks! Excellent article about Soddy’s work.

            The issue Soddy, Daly and others have not recognized is that the addition of cheap energy can indeed increase the output of the economy. Debt is needed if this cheap energy is to be added to the economy. In fact, the use of additional debt can even make it look like expensive energy might be helpful to the economy.

            Because of our need for a growing supply of cheap energy, there is no way that we can make an economy work, if we follow Soddy’s advice and stop banks (and others) from creating money out of nothing. (This is mentioned in the article as Soddy’s fifth requirement.) We need an increasing supply of cheap energy, and an increasing supply of debt is needed to get this energy extracted.

            Lots of people seem to learn pieces of this puzzle, but cannot see the whole nature of our predicament.

            • Stefeun says:

              Thanks for your comment. I think it boils down to the fact that Soddy didn’t realize that growth is mandatory (and not only because of interest rates).

              For the rest, I think it was implicit in his theory (economy as an engine whose ‘speed’ depends on the energy input, absurdity of a debt growing ad infinitum whilst real wealth is physical and decays, etc…).

              We can’t really blame him for not having considered the rising cost of energy and other diminishing returns and limits, as such problems weren’t as acute as today, when he wrote in the ‘Roaring Twenties’.

              Moreover, his message was strong enough and so much in contradiction with the cult of mainstream economics, that we may forgive him for not having fully explored the outcomes of his theory, that seems to be steady state economy (hence Herman Daly), which we know doesn’t work.

              From another article:
              “Soddy’s message delivers some uncomfortable truths about who we are (we are subservient to nature, not omnipotent), and what we can aspire to (we can’t build an economy on get rich quick schemes, so forget about flipping that house, winning the National Lottery, or trying your luck on TV Talent shows). He had clearly pointed out the absurdity of everyone trying to live off the interest from savings. Certainly one group could achieve this, but it would be foolish to think that a whole society can expand its purchasing power in aggregate by the same method. Perhaps most of us are hardwired to believe in the fairytale of perpetual profit and infinite growth. Not only were Soddy’s views deeply unpalatable to the existing power structure of society, but they probably cut against the grain of human instinct, too.”


            • Van Kent says:

              Mr Soddy´s Ecological Economics makes me want to ask the “what if” question.

              What if we had had some real science in economics, political economics, in the 18th or 19th centuries, could we have done better? Unlimited growth on a finite planet, ad infinitum, seems childish. Yet exactly that is the core assumption of economics, still.

              If we could give advice to our 18th or 19th century peers, what advice would we give?

              Take a analogy of a spaceship and a spaceship captain. If the captain wants to reach the destination, I doubt he would tolerate fractional reserve private banks within the spaceship. The spaceship would instead have to run a tight “economy” within the means of the spaceship. Some private factions wanting to make as much profits as fast as possible within the spaceship would probably be jailed pretty quickly. Instead, the spaceship captain would probably run a “Radical Rationalism” economy. But how does something like a “Radical Rationalism” political economics translate in to institutions, laws and ideology, in other words advice to our 18th or 19th century peers?

            • Stefeun says:

              Van Kent,
              I have a simplistic answer to your “what if” question:

              such “rational economics” would probably have been implemented in only one or a few countries, in which growth would have slowed down. That would therefore have put these nations in a position of weakness compared to other ones where the burn-baby-burn frenzy reigned.
              I let you imagine what happens if these “rational” nations have interesting resources (same fate as our ex-colonies, in fact).

            • Stefeun says:

              Van Kent,
              as for your analogy:

              The spaceship has a destination; we haven’t any.
              The crew, everybody in it, must team together; we just can’t (we owe most of our success to cheat).

            • Van Kent says:

              Stefeun, to prevent the rule of the ruthless, we invented the rule of law. To prevent the rule of the ruthless lawmaker (psychotic warlord and lieutenants / king and nobles), we invented democracy to change the ruler(s) at regular intervals. And to prevent the ruthless lawmaker factions within a democracy, we invented the threefold separation of power in the government (elected lawmakers, a judicial system and the police).

              I understand our culture has pretty much forgot such things during the last century, but those were the reasons, originally, why we live in a civilization like we do today. We wanted to build something better; cooperation, commerce, liberté, égalité, fraternité. Millions were ready to die, and did die, so that we could live in world free of ruthless powerplayers. During the last century we´ve become fat and lazy on oil and have forgot such things. We picked the fruit, but failed to bear the responsibility that comes by it.

              Seems to me, our failure is one of inadequate political philosophy where we weren´t mature enough to produce/ invent the final step, that would have taken the prevention of ruthlessness to a global level.

              Stefeun, we invent laws and instituions to produce the society and the outcome we desire, despite our primal urges.

              And conserning the destination, I would have been happy with a few more centuries of science, just to see what quantum physics could have produced, instead of facing an imminent collapse like we do today.

              Well, anyways, thanks Stefeun, it was nice to know exactly where we f-ckd up, before the fat lady sings.

            • Stefeun says:

              Van Kent,
              as a French, I’m pretty much aware of, among others:
              – Montesquieu’s 1749 “De l’Esprit des Lois” (The Spirit of The Laws), about separation of powers, constitutional system and ending of slavery,
              – The 1789 Révolution, with Liberté Égalité Fraternité and the Human Rights Declaration,
              – the strong public service implemented in France in the aftermath of WW2,

              and I used to very much believe in socio-political l struggle to reach a level of wellness and dignity acceptable for all, and to be on the “right tracks”.

              Then I realized (thanks to Gail, mainly) that democracy and social justice are sorts of “luxuries” that can be implemented and actually work only in periods when the energy per capita ratio is on the -strong- rise.

            • Van Kent says:

              Stefeun, Paul Craig Roberts thinks we are in the wild-wild west already.

              The Rule Of Law No Longer Exists In Western Civilization http://www.paulcraigroberts.org/2016/01/05/the-rule-of-law-no-longer-exists-in-western-civilization-paul-craig-roberts/

              “America and its vassals are lawless. No one is safe from the government.”

            • Stefeun says:

              What Law, Van Kent?
              Lies are legalized, and are backed by violence that is legalized as well.
              Shoot first, discuss later; for lack of a law, this is the rule.

            • Artleads says:

              Paul Craig Roberts

              “The media whores have fallen in line with the would-be dictator. All we hear is “gun violence.” If only Karl Marx were still with us. He would ridicule these fools for turning inanimate objects into purposeful actors. It is extraordinary that the American left-wing thinks that guns, not people, kill people.

              The position of the “progressive left-wing” in the United States is perplexing. Here are Americans, immersed into a police state, as are the Hammonds, and the progressive left-wing wants to disarm the population.

              Whatever this “progressive left-wing opposition” is, it has nothing in common with revolutionaries. The American left-wing is totally irrevelant, (sic) a defeated force that sold out and no longer represents the people or the truth.”

              And I came to a similar conclusion just through intuition.


            • Stefeun says:

              of course guns don’t fire by themselves, but one important thing is missing in this argument, IMHO. It’s what we call “passage à l’acte”, in French.
              Thinking of killing someone is one thing, going from word to deed is another. Taking action is much easier when you have a gun at hand.
              To think that gun owners have full control all of the time and in any situation is an illusion.
              Not to mention that ‘taking action’ isn’t always voluntary; I heard that in average one person was shot to death by a child every day (iirc).

            • Don Stewart says:

              I grew up in a small town where violence was very common. But I can’t recall anyone who was ever murdered. The difference is that our little town had a lot of angry people who were forced to fight with fists because they didn’t have guns and it was shameful to hit somebody from behind with a baseball bat. In Chicago, today, there are likewise lots of angry people, but they have guns and knives and there is little shame in killing people from ambush. Gerald Ford danced in the White House to the song ‘Bad, Bad Leroy Brown…the baddest man in the whole damn town’. Leroy ran afoul of a guy with a knife who cut him to shreds. Things were different in Chicago.

              Separately, I write about the ‘built environment’ and its influence on behaviour. This is just another example

              Don Stewart

            • “Not to mention that ‘taking action’ isn’t always voluntary; I heard that in average one person was shot to death by a child every day (iirc).”

              And how does a child happen to have a loaded gun in its hand? Some gun owner failing to be responsible with it.

            • Artleads says:


              I see your point (although it could be refuted). Like pregnancy, not getting to the point where you need a prophylactic (no sex, no gun) is the safest alternative. But if we look at the issue in stages, the immediate issue is a governance system that might be more deadly than life supporting. And the immediate near term solution to that might not be to disarm the rabble. Maybe the rabble disarms itself when there is some modicum of order–in some fancied or hoped for saner future. I don’t see gun ownership as fundamental to do with planetary predicament. And I see gun ownership–along with myriad, possibly futile efforts at resistance–as better near term than the alternative.

              Just my state of mind today. 🙂

            • Christian says:

              Stef, isn’t it funny that equality regarding violence only exists in energy rich societies and in the opposite end, hunter-gatherers?

              About gun control, it’s kinda joke to see Obama crying for some shooted American children when he is bringing the same fate to Syrian ones… Nobel Peace prize… I would say it’s black humour, but I don’t want to be called a racist…

              I recall Michael Moore’s Bowling for Columbine where he found Canada has a similar amount of guns per capita than the US, while murdering is an order of magnitude below. The relationship US people have with weapons is interesting. They think of themselves as the most powerful of the world, and this representation of society is tied to a representation of the individual which must also to be powerful, in the same way, and death penalty is the reciprocal consequence (please correct me if somebody find I’m wrong, never been there). Of course these are things that happen to small people, not to important families.

              The other two nations that ever had a similar worlwide status are the Brits and to some extent the Spaniards, and both did managed this issue differently. They have in common they were still marked by the feudal system, where hoi polloi were allowed to use weapons only in the benefit of the lords.

              At the time they ruled half of the world the Brits invented sports, which are a kind of sublimation of violence. I guess this deep acknowledgement of limits could be tied (among a couple of other things) to the fact that the island was a very obviously limited place, which was not at all the situation for their American heirs.

              And the Spaniards, which ruled half of the Americas, the Phillipines and a couple of places in Europe, they were strongly marked by the feudal point of view as they were the first empire. I’m not sure, but I think they managed the problem of intra societal violence (which is the point, not the violence against others as Obama makes it clear) through a huge development of right and law, creating many imperial institutions and posts to deal with it.

              Russia/USSR did found itself in a similar situation. I guess they called their solution “gulag”

            • kesar0 says:

              Having population equipped with 350 million firearms gives dramatic outcomes, like school massacres. On the other hand, it is very convenient from the military point of view. Who will invade a country, where all citizens will be in guerilla warfare the next day?

              Switzerland is ranking third (after US and Yemen [?!]) in firearms per citizen.
              “All healthy Swiss men aged between 18 and 34 are obliged to do military service and all are issued with assault rifles or pistols which they are supposed to keep at home.”
              Swiss are smart people. They know that the hordes will come to the roof of Europe one day.

              Similar guns saturation, different outcomes. Culture and education make the difference.

            • Stefeun says:

              Christian and others,
              no doubt that the rate of ‘passages à l’acte’ is modulated by several factors, the main one being -in my view- what I’d call the social link.

              If a person feels alone while facing a given threat, he will tend to over-react much more easily than another guy facing the same threat but feeling that other people are also concerned by what happens, or that a whole organisation can treat the problem efficiently.

            • Christian says:

              Stef, you’re right on the social link. It’s the hyper individualistic frame of US culture which makes so much passage à l’acte possible

              Kesar0: Yemen!!??

              It’s true nobody will dream of invading the US (barring the weaponless actual Mexican invasion, haha)

              About the Swiss… It’s a cultural trait, but possibly rooted in… resources and geography? Take a look at this:


              They were the top european mercenaries since the late Middle Ages, and that is the root of their militia army. It even possibly goes farther in time, given they defeated important invading armies by themselves. But did they turned mercenaries because the Alps were not so much suited for such things as agriculture? Did they had any mine to exploit?

              I’d surely say that the (comparative) over militarization of Switzerland resolves pretty well intra societal violence issues with… the most perfect modern democracy, which is possibly rooted in… geographical isolation and… the very fact of being mercenaries? (Ancient greek mercenary armies were also very democratic)

            • kesar0 says:

              Yes, they have a long tradition in mercenary services. Even the popes used their services from XV century. They are ultimate highlanders of Europe, very tough people.

              I guess the relative isolation and limited domestic resources created quite peculiar society model. On the other hand they are in the center of the most developed continent, at the cross-roads from east to west and from south to north. They benefited from this cultural mix. The bankers fleeing from many other countries like Italy and France after the revolution looking for safe havens also contributed to their current wealth. 12% of GDP is financial services. Multiply this by 3 at least, as they host many very wealthy people in different occassions,
              [like this for example
              http://www.telegraph.co.uk/news/worldnews/europe/switzerland/12072595/Qatari-royal-fleet-rushes-to-Switzerland-after-former-Emir-breaks-his-leg-on-holiday.html ]
              add CERN, UEFA, FIFA, many other international organizations, all these dictators keeping money in Swiss banking system and you have really comfortable wellfare state.

            • Christian says:

              Just as you say. I already knew about the Emir’s leg, lol

            • kesar0 says:

              Lol, good stuff!

            • Ifromplanetclaire says:

              I train in a martial art that utilizes both blunt and edged weapons as well as the movements and parts of the body that can be use as weapons. I would be very pleased if aliens were to descend and vaporize all firearms on the planet (as described in the Conan the barbarian novels). Better odds for me.

          • ejhr2015 says:

            So you too are rejecting reality? That’s your choice of course, but the economic reality is that we are operating NOW in an MMT world! But it’s not recognised as such. What I stress is that we need to understand that MMT is reality, and not the academic fantasy land touted by mainstream economics. As I mentioned before you need to keep an open mind, because understanding has to overcome a mighty amount of prejudice and misinformation and bias, into which trap you have fallen.
            Anyway don’t take my word for it. I’m only a messenger. That’s why I list sources. If you don’t look into them then your ignorance will remain.
            Bill Mitchell’s Saturday quiz is worth following as he understands traditional economics as well as MMT. Here’s a typical one;

            As a PS. When I got tired of having to click on every post to follow a thread I took on a WordPress account and had to change my moniker, so I am using ejhr2015 and not my real name now, which is John Doyle. Sorry about that!

      • Thanks! According to this link

        Debt deflation is a theory of economic cycles, which holds that recessions and depressions are due to the overall level of debt shrinking (deflating): the credit cycle is the cause of the economic cycle.

        This is certainly part of the story, besides the cheap energy story. My charts show that debt shrinkage was a major part of the 2007-2009 recession, and it looks very much like we are headed into a major recession now, because of debt deflation–really unpayable debt. In some ways, it is like Ponzi Schemes collapsing, and new Ponzi Schemes being added–only at first they aren’t Ponzi Schemes, because there is cheap energy holding up the system.

        I am on my way to the funeral of a cousin. I may not be available as much in the next couple of days.

    • Stefeun says:

      Just for fun,
      found an older case of Commodity Speculation:

      “Aristotle gives a report of commodity speculation in his day involving Thales of Miletus, the first philosopher:
      People were reproaching Thales for being poor, claiming that it showed his philosophy was useless. The story goes that he realized through his knowledge of the stars that a good olive harvest was coming. So, while it was still winter, he raised a little money and put a deposit on all the olive presses in Miletus and Chios for future lease. He hired these at a low rate, because no one was bidding against him. When the olive season came and many people suddenly sought olive presses at the same time, he hired them out at whatever rate he chose. He collected a lot of money, showing that philosophers could easily become wealth if they wished, but that this is not their concern. Thales is said to have demonstrated his own wisdom in this way. But . . . his scheme involves a generally applicable principle of wealth acquisition: to secure a monopoly if one can. Hence some city-states also adopt this scheme when they are in need of money: they secure a monopoly in goods for sale.”

      p.10-11 of http://www.peter-boettke.com/app/download/7024744304/Miller_paper.pdf

      • ejhr2015 says:

        The biggest problem is that you accuse MMT of being a perpetual motion machine. How about you tell us why you believe that? Afterwards we can discuss your evidence . Thanks

        • Stefeun says:

          I don’t believe in any monetary trick, at least in the long term. They can help hide the problems temporarily, but do not change the underlying reality.

          We can print money, but not wealth, which is what matters.
          To paraphrase Soddy, real wealth is physical and material, whilst money is “the nothing you get against something, before you can get anything”.

          Money is a claim on future energy. If the energy isn’t there, money is worthless.

          • ejhr2015 says:

            Stop being evasive. You stated MMT was a perpetual money machine, but now you write generally about money as debt or wealth. Or have you thought better of describing the “perpetual motion” idea? you agree it is not true, or if not why not? Try to stick to the question so we can progress.
            IMO you don’t have a leg to stand on and you know it.

            • Stefeun says:

              I told you earlier that I don’t understand the theory, how it can work.
              But if you say it does, then fine, please go ahead!

            • DJ says:

              Just do like Jesus – print more bread and more fish.

            • DJ says:

              So no more fishes? Only more money for same amount of fish and bread? Thats just redistribution.

          • Fast Eddy says:


        • pintada says:


          A perpetual motion machine produces something from nothing thus violating the Second law. MMJ theoretically produces wealth – things like oil, gold, neodymium, windmills, by printing money. That violates common sense, and as an analogy the Second law of thermodynamics. One cannot “prove” an analogy, and one need not “prove” things that are obvious on their face.

          You wouldn’t be here if you didn’t understand the name of the site – Our Finite World – so, you know that the world is finite. Infinite amounts of money chasing a finite supply of stuff is the definition of runaway inflation, and MMJ would/has/will eventually produce massive inflation. The fact that printing money to stimulate an economy does work under limited conditions for a limited time not withstanding.

  19. Artleads says:

    “The report notes that a lot of older management personnel prefer to drive, while younger workers want transit access. So buildings that offered both were in the highest demand.”

    A little of this, a little of that…


  20. MJ says:

    Stunning But Depressing Photos Show Us How Humans Are Destroying Earth


    Now, a new book titled “Over-development, Overpopulation, Overshoot (OVER)” from the 2015 Global Population Speak Out campaign looks to help reveal just how severe humans’ impact on the Earth really is.

    “Overdevelopment, Overpopulation, Overshoot (OVER) contains powerful and evocative images showing the ecological and social tragedies of humanity’s ballooning numbers and consumption,” the group states on its website. The book retails for $50, but a digital version can be viewed online for free.

    Business Insider compiled a handful of particularly poignant images from the book. You’ll find a few of them below, and the full book can be viewed on the Global Population Speak Out website.

  21. Ki says:

    Are we expecting prices to drop to less than $20 usd per barrel?
    according to this bloomberg video it could happen.

    • Definitely yes. Storage will fill, and prices will drop very low. It happens with natural gas and electricity frequently. It will be hard to fix for oil.

  22. Don Stewart says:

    Dear Finite Worlders
    Relative to what I wrote about Montgomery and Bikle on microbial partners for health, and Charles Hugh Smith on the sad state of health care. I will steal this from Charles weekend note to his subscribers. One is a letter from a Canadian doctor, the other a US doctor…Don Stewart

    U.S. Physician:
    As an emergency physician I watch in horror the mess that we have collectively gotten ourselves into with our poor health, complex and profoundly wasteful system, and hundreds of rules to ensure safety and reduce liability.

    Some rambling anecdotes:

    1. at least 50% of the people I see on a given shift are in the emergency department (ED) as a direct result of unhealthy and destructive life situations: Diabesity (diabetes, hypertension, arterial blockages in heart, brain and legs), smoking (chronic lung disease), alcoholism (vomiting blood, pancreatitis, liver disease, chronic brain deterioration), drugs (faking illness to obtain narcotics, withdrawal syndromes, overdoses and seeking admission to rehab).

    2. much of disability in the elderly results from the combination of obesity with arthritis –and the resulting deconditioning. All obese inflamed people have pain (hip, back, knees), are short of breath with exercise, and begin to decondition to where climbing a few steps becomes very difficult. At some point, they must go into nursing homes as they cannot care for themselves and they are far to heavy for family to lift. This is not a disease but a downward functional spiral that many do not recognize until very advanced.

    3. A special note must go to the Pickwickian hypoventilation syndrome in the morbidly obese: massive layers of fat lie across the chest wall and fill the abdominal cavity restricting breathing movement. The brain slowly adjusts to not being able to exhale CO2 adequately and the person moves into permanent respiratory failure, weakness, cognitive decline, exercise intolerance. I see this everyday I work.

    4. The community’s poor and uninsured use the ED for primary medical care. The ED is the only place where you can see a doctor without insurance or putting money down. Since many do not have cars, they come in by ambulance. Some are hypochondriacs, many not terribly bright and many very anxious. Others are just very unsophisticated and need “to be checked by a doctor” every time one of the kids vomits, skins a knee or comes into the proximity of a spider. Medical records show an ED visit for someone in the family every 2-3 weeks. They are seen in the highest tech setting possible for the most minor concerns. And time constraint limit patient education opportunities.

    5. Depressed, obese, arthritic, unemployed, Mountain Dew and Marlboro consuming people have pain. Often lots of pain. In many locations. And narcotics improve that pain (temporarily) and offers a blessed and blissful (but temporary) relief from depression. Going to the ED to get narcotics is a ubiquitous pass time of the rural poor in Virginia. And of course you have to prepare a good story: “Well. (takes a deep breath) I was up on the roof when my horse kicked the ladder and the tree fell over towards my car which hit the side of the house knocking loose a shingle…..(etc) …. and it hurts REALLY bad.” (If you don’t believe me I can lie on the floor and scream a bit. Do I need to do that today?) About 15% of patients are probably lying about everything they say.

    6. And then there are the RULES. Tens / hundreds of hospital policies and rules to ensure uniformity, reduce liability risk, and conform with government regulation. And the bureaucracy to oversee the application of the rules.

    7. Sometimes patients just don’t go to work and are told that they “must get a doctors note.” They come to the ED, tell a tall tale, have $1,000 -$2,000 worth of tests that are surprisingly normal, and are given an off work note.

    Canadian Physician:
    I am a family physician in Ontario, Canada with an absolutely conventional medical practice. I practice according to whatever guidelines are handed down by the Powers That Be. For me, it’s just a daytime job.

    There are three “clusters” of diseases which I see more of, day-to-day, than any others, and which form the bulk of my workload:

    1. “Diabesity” – the constellation of conditions which include diabetes, obesity, hypertension, sleep apnea and osteoarthritis, as described above by sand_puppy

    2. Low level mental health issues including anxiety, depression, insomnia, work related stress and chronic narcotic dependence (many of these often co-exist in the same patient)

    3. Chronic pain. It’s often difficult to differentiate genuine chronic pain from chronic narcotic dependence, and I suspect that again, they often co-exist in the same patient.

    If I didn’t have to deal with any of these issues, I would be working one day a week and doing something more useful with the rest of my time, like practicing a musical instrument, or gardening. I don’t think I do much good for most of my patients because they never seem to improve. However, they look to me as being the provider of their health, it doesn’t seem to occur to them to take control of their health themselves, so I don’t give them a hard time – I just play the role society expects of me as best I can, and wait for what comes next.

    In the event of the gasoline supply drying up, the banks closing or the grocery stores emptying, I don’t think most of my patients would live very long.

    • ejhr2015 says:

      Isn’t life fun, for some! No decent jobs, no decent prospects for a decent future, marginalised and ignored by the better off sections of the community. Is it any wonder they seek relief in overeating, over drinking and many other harmful pastimes. These Doctors are at the coal face. Lets put our politicians into their shoes for a day. The medical system is not as dysfunctional as is the political one by a long shot!

      • Don Stewart says:

        Gabor Mate, now retired, worked with people very much down on their luck in Vancouver, Canada. He says that drug addiction makes sense when you consider that the addicts can’t stand the pain in their lives, and can’t think of any other way to cope. Some of his evidence is from looking at Viet Nam veterans. Many returned to the US as drug users. Yet most of them kicked the habit pretty quickly, without any special help. The average Viet Nam vet was a draftee (higher educational and socio-economic status than enlistees), who could relatively easily fit back into the mainstream of American society. Drugs made sense in the horrors of Viet Nam, but did not make sense in suburban America.

        Don Stewart

        • Van Kent says:

          A MD who quit his profitable eye surgeon practice to take care of addicts, once commented to me that he can immediately recognize a lost case, its when the addict tells him the substance made the addict feel “normal”.

          The point being, that some of us have chemical imbalances in the brain, or our life circumstances are such, that by taking a drug the brain chemistry is instantly transormed forever. If the initial dose makes the brain chemistry as “normal” it actually never returns to normal, but is addicted forever after.

          Perhaps something like that is true, I just enjoy my whiskey and cigars from time to time. I know that Cannabis/marijuana can stay in the brain for years, causing a higher probability for depression and psychosis for decades. LSD and hallucinogens can stay in the brain chemistry forever. Don´t know if thats true for natural substances like Ayahuasca though.

          Sometimes I´ve wondered if traditional shamans with substances like Ayahuasca could actually “medicate” chemical imbalances in the brain. The villagers knew if somebody was manic depressive, bipolar, by just commenting “ok, he´s “on” again”. Such people were common, schizofrenia actually manifests evenly in 1% of the population, regardless of the population. Its strange to think that whatever makes us human, also makes 1% suffer from schizofrenia. If brain chemistry can be altered by psychoactive natural substances, it should be possible to forever cause an imbalance, or an equilibrium again. So, I´ve just been wondering if the ancient shamans could use something like Ayahuasca to “re-balance” unbalanced brain chemistry..

          • JMS says:

            “I know that Cannabis/marijuana can stay in the brain for years, causing a higher probability for depression and psychosis for decades”

            Sorry, Van Kent, Frequently you make good points in your comments, but I suspect you know nothing about cannabis. In my life I new dozens of frequent cannabis consumers, being one myself (although not a heavy one) and I can guarantee you that they are the least depressed and psychotic people I ever knew.

          • Christian says:

            I subscribe to the entire JMS paragraph, from Sorry to knew (excepting that I can rather be found in the heavy users group). But if by any chance you ever find something that get you high for a year… don’t forget to tell where to find it!

            More seriously, I’ve read a lot of research on drugs and even ended up writing a couple of peer reviewed anthropological papers myself. And… well, better you don’t believe all MSM are saying. The most interesting case I’ve come across is paco (cocaine paste), which is a collective name for a set of intermediate substances that are obtained before pure cocaine. This happened some 15 years ago, when paco was making headlines in the press in Argentina as the new killer of the youth (or rather the poorer kids). It was heavily demonized (hyper addictive, brain destroyer, etc). But I couldn’t find a single scientific paper about paco. It was demonized on a purely sentimental basis. And I realized there was no research on paco because it was only consumed in South America and not in developped countries, which are the only ones to do such a kind of work (and nothing of this has really changed).

            The most interesting was that most cannabis and even cocaine users I knew did maintained the stereotype that paco was a “real” brain killer… I was offered to smoke it once, and didn’t find anything special on it

            And I was also offered ayahuasca once, by a friend who brought to me half a liter from the Amazonian jungle where he lived in a Santo Daime village for a few months. And I can tell you this is a real drug. My friend wrote some papers about Daime, which is an interesting mix of Shamanism, Christianity and African stuff. But you are rather referring to the Peruvian shamanic tradition (Daime is Brazilian), where there are also a couple of shamans specialized in western junkies rehab. As far as I know, it works. But I don’t think ayahuasca can cure or stabilize things like schizofrenia, never heard about it.

            What I can say after all that research is that it’s impossible to explain psycoactive drugs from a purely neurological approach. Not that there is something magic about them, but the human brain is the most complex structure of the universe and the most sensitive organ we have. We know just a few things about it, and the way drugs really work is not one of them. Drug use -including the “mental state” users get- is highly determined by the social and cultural meaning these substances have, which is possibly also “written” in the brain but this we can’t see it even with the most powerful non invasive existing scanners.

            Of course chronic drug use can lead to temporary or permanent damage of the brain, as it happens in alcoholic dementia. But it is a hard work to get the truth about illegal drugs, given the issue is so much morally loaded. It’s interesting that some people can feel drug use makes them normal, and that those are the cases rehab can’t get. Because normality is what most users are rather willing to avoid at some point. But I wouldn’t try to explain it as a chemical reaction, given “normality” is related to a social position, to cultural meanings and habits. Not the kind of thing one can expect from chemistry, which is universality. Ayahuasca is a powerful thing, but my experience was very different from the one Daime’s followers have, which in turn is different from the one purely shamanic religion brings on. As Rob says, setting is very important.

            And it is not a coincidence that in the Age of Limits we see a bit of legality for cannabis even in the US, Because the meaning of life itself is changing.

            • Van Kent says:

              I find it a bit controversial that modern medicine is so concentrated on how to make and distribute artificially produced molecules, to cure the imbalances of the body. But at the same time, we don´t try to prevent those very same imbalances by taking care of our gut flora in advance. There is a strange dichotomy, medicate illnesses yes, but don´t try to be healthy in advance. Don´t try to prevent alcoholism, depression, marginalization or social exclusion in advance, just medicate antidepressants after.

              Because recreational drugs are hedonistic, culture related, cohesive culture builders, illegal and fun to start with, its seems to be difficult to talk about them. On every level. Just wondering if rehabilitation of addicts would be easier if the paradigm changed to creating a “new normal” creating a new equilibrium, instead of treating a sickness..

              Its a strange culture we live in. We have the innate right to mistreat our bodies any way we like, and after the body can´t take anymore, we have the right to demand medication for a rerun. Just because we felt like it. Some thoughts on habits http://www.theguardian.com/lifeandstyle/2016/jan/05/diet-detox-art-healthy-eating?utm_source=Greenhouse+Morning+News&utm_campaign=04decc1518-Greenhouse_Morning_News_January_5th_2015&utm_medium=email&utm_term=0_990f8eae78-04decc1518-93638529

              Yup, when MD:s talk about probabilities of something to happen, one has to be very carefull listening what they are actually talking about. If somebody says there is a 40% increase in probability, but what he is actually saying is, that where there once was a 0,30% chance, there now is a 0,50% chance. Yes the probability increased by 40%, but is still incredibly unprobable.

            • Stefeun says:

              Van Kent,
              Healthy people are not interesting for BigPharma, which is a big contributor to GDP.

            • Stefeun says:

              Nice comment, all of it.
              Esp. liked: “Drug use -including the “mental state” users get- is highly determined by the social and cultural meaning these substances have, which is possibly also “written” in the brain”

            • Christian says:

              The topic you mention has been discussed several times in this blog (while you are the first to extend it to detox). The point is preventing damage is free, but healing means business: Obamacare is the nec plus ultra on this concept. Take a look at Marinol, registered trade mark for dronabinol, which is synthetic delta-9-tetrahydrocannabinol: a synthetic production of the very main psycoactive molecule of cannabis, which was or still is produced and sold in the US (and Canada I think) since the late 80s and allowed for cancer and AIDS patients; but growing some hemp in your backyard: no, you’re a criminal

              Of course one can think that the money going to pharma corps could anyway be spent in something else, but in the end even with our intended unhealthy way of life we still perform better than in XIX century. Oil is so much generous…

              “Because recreational drugs are hedonistic, culture related, cohesive culture builders, illegal and fun to start with, its seems to be difficult to talk about them”. I’d rather say: “Because recreational drugs are illegal its seems to be difficult to talk about them”, given alcohol, tobacco, coffe (and here we have mate also) could also be seen as hedonistic, culture related, cohesive culture builders and fun, but it is not difficult to talk about them. Most of these drugs have also been banned at some point in history anyway, while there were specific social traits that helped them to go legal and mainstream again

              Personally I am very sympathetic to a healthy way of life (I owned an organic shop for a few years) but the truth is I’m rather a big mess regarding my own body: I smoke 20 cigarettes a day, as one or two joints if it is at reach (but I don’t care if I can’t get it, which is not the case with nicotine). I eat badly since I broke with my last chick and live alone (find it burdensome to cook for only one person, though it goes better when I’m with my kid or some friend). I do some exercise, that’s the only good point. I can’t run for long because of my lungs, and my teeth are not doing fine at all, but I never get sick nor need to see a doctor (kinda once every 5 years, excluding teeths and accidents). I suppose I will only quit cigarettes when Phillip Morris collapses but I guess I will improve my diet if I get another woman to live with. But when I say that I eat bad I am not referring to the US junk food style, which is not so much a habit here; rather too much wheat. However, I’d be very pleased to share a healthy meal with Don Stewart

            • Christian says:

              Glad you liked Stef

        • Rob says:

          Part of that story of Vietnam vets kicking the drug habit when they returned had to do with the setting in which they became addicted. There is a strong learning component to addiction in which one can be addicted in one setting, but when removed to a completely different setting, the addiction is no longer active.

  23. Rupert says:

    Still nobody is getting it. It IS possible to imagine a universe (but not THIS one – which is what you are doing) in which the energy source is NOT other beings. As simple as that. After all, plants on this planet subsist on sunlight only – though the Venus fly trap does kill and consume other beings. Imagine instead a universe where it would soon be noticed that trying to eat your fellow beings had bad effects – just as a certain practice brought kuru:


    to the Fore tribe of Papua New Guinea.

    Why is it so hard for people to think outside the box?

    • Rupert says:

      “a certain practice” – it seems the “c” word (eating people!) is censored here! When I included it, my comment was not posted. I know Gail is squeamish about the very mention of certain eating practices(!), but it wasn’t intended to upset her.

    • Don Stewart says:

      Sorry to disillusion you. Plants put up to 85 percent of the carbohydrates they make with sunlight into the soil to attract microbes which are eaten by other critters and bring nutrients to the fine hairs of the roots in a chemical form the plant can use.

      Looked at from one angle, the relationships in the soil food web are symbiotic. But they definitely involve killing on a massive scale.

      Don Stewart

      • Rupert says:

        “Rupert Sorry to disillusion you.”

        OK, I stand corrected. But now I’ll sit down again and say it is POSSIBLE to IMAGINE a universe, somewhere in the multiverse, that worked on different principles, and where killing others for food was not just unnecessary but rendered either impossible or else so unattractive in its results. Of course, there would then have to be some mechanisms for creatures to die and some mechanism to replace decay. But in all possible universes, this would be possible for creation to work out. It is only the limits of human imagination that stop people from imagining it is possible – HOW it would be so is another matter, but we still haven’t figured out how much of THIS universe works, and we know that there are astounding parts of it which may once have been considered impossible.

        • Don Stewart says:

          I won’t claim it is absolutely impossible for living creatures to subsist on the decay of creatures who are decaying after natural deaths.

          In this world, however, chemistry puts limits. Many nutrients are tightly bound and are not available to plants. The most famous is probably nitrogen, which comprises most of the air that plants live in…but which is completely unavailable to the plants. Certain bacteria fix the nitrogen in their bodies (they have a C to N ratio of 5 to 1). When a larger critter with a 30 to 1 ratio eats the bacteria, it gets excess nitrogen, which it poops out into the soil. The nitrogen it poops is in the correct form for the plant to take up and make proteins. That’s one of the reasons the plants put so much sugars into the root zone.

          Many other chemicals are usually found tightly bound, but the soil food web makes them available to the plants.

          Assuming that the same laws of chemistry apply everywhere in the multiverse, it would take some very clever engineering to get around all the obstacles.

          Don Stewart

          • Rupert says:

            @Don Stewart – You are very knowledgeable about the processes of the Earth and I admire that. However, you then write: “Assuming that the same laws of chemistry apply everywhere in the multiverse, it would take some very clever engineering to get around all the obstacles.” Again, you are not getting it. That is precisely what you cannot assume. We must assume that existence is trying out every possible way, so there will be universes born with very different laws from ours. Some will bear life, the majority will not, and some will collapse in short order because the physics and chemistry are wrong. Among those, there will be some where our brutal food chain does not exist. Suffering, however, would still exist, in those with inhabitants, because of free will – if that was given to inhabitants of other universes. And also because of the results of naturally occurring disasters. I don’t imagine a “paradise” would exist anywhere in the multiverse, because perfection is in the eye of the beholder only, and in any case it would be very boring – hence I wouldn’t want to live in a paradise. You don’t enjoy and appreciate the smooth unless you can experience a bit of rough.

            My point is to those commenters who say that life on Earth is not a matter of dog eat dog, nature red in tooth and claw, the survival of the fittest, etc. I say, on the contrary, it IS. The food chain is at the heart of biology – it is the basis of the biological system on this Earth, and you cannot escape the system. I am sure Fast Eddy would also agree with that. But since he likes and enjoys the current comforts of BAU, he should at least sympathise with my hope that there are other systems in the multiverse that are not so brutal – yet still far from being paradises, because they would be boring.

            • Rupert says:

              As a minor matter of interest, five doors away from my house you see this:


            • Don Stewart says:

              I think that the Buddha diagnosed the human condition pretty well 2500 years ago…impermanence and discontent. Whether there is some alternate universe where human-like creatures exist who are not subject to impermanence and striving is an interesting exercise in theoretical physics. However, I spend the great majority of my time in this universe dealing with both impermanence and unsatisfactory conditions.

              In terms of unsatisfactory conditions, we can look at the evolution of life on Earth and see the enormous increase in biological productivity over the last billions of years. That increase in productivity has been made possible by the discovery and use of synergistic relationships between the critters who live here and the minerals which constitute the earth and its atmosphere. As the sheer volume of biological life has multiplied, so has the amount of suffering. It would be interesting to bring the Buddha back for a discussion on that point.

              Many people who are actually trying to do something about suffering are attracted to either the Quaker movement or the Vegan dietary movement. In terms of Veganism, if you are looking for a reason to eat plants but not animals, you can observe that the carbon to nitrogen ratio of green leaves is the same as that of the human body (not surprising since we are primates). Some people think that eating our own carbon to nitrogen ratio has health benefits.

              I am dubious about that logic….but don’t profess to have any useful professional knowledge on the subject. For example, the critters who eat the high nitrogen bacteria simply excrete the excess nitrogen (which benefits the plants). In theory, why couldn’t humans eat bacteria and simply excrete the excess nitrogen?

              At any rate, eating lots of green leaves has many health benefits. We don’t have to twist biology into a pretzel looking for some inherent difference between a green leaf and a cow on which an ethical edifice can be erected.

              Don Stewart

          • Rupert says:

            Don Stewart wrote:

            I think that the Buddha diagnosed the human condition pretty well 2500 years ago…impermanence and discontent. Whether there is some alternate universe where human-like creatures exist who are not subject to impermanence and striving is an interesting exercise in theoretical physics.”

            Again, you are missing the subtleties of my argument. I am not suggesting that any other universe would be free of impermanence and discontent. It would then be the prefect paradise that would be boring in my view. Personally, I would not enjoy living for ever, however enjoyable a world I inhabited. So LACK of impermanence would make me discontented. And in any universe, creatures of free will would at certain times become discontent and yearn for change. Discontent is the father and mother of change. And I suspect all universes would be subject to change.

            As for Fast Eddy’s response – I don’t know what he’s smoking. He most definitely has missed the subtleties of my argument.

        • Fast Eddy says:


          It already exists — it’s call Koombaya Land…. a place where everyone eats free peanut butter and granola… a land of eternally flowing organic beer …. where people dance around the fire then engage in endless free sex —- where everyone is eternally 23 years old….. where there are no banks… no need to work…. everything just happens — if you are willing to ‘imagine’

          A 747 won’t fly without the wings —- even if you ‘imagine’ it can

          • Rupert says:

            No, Fast Eddy, I am not a John Lennon fan. I am saying, yes, imagine – try to imagine a universe without a brutal food chain. However, that does not mean that there would not be suffering that resulted from the actions of the creatures that lived there, or from volcanic eruptions or whatever. A paradise, would, I imagine, be impossible, and in any case that is not what I am suggesting or seeking.

            • Fast Eddy says:

              Imagine I was 7ft tall and playing centre for the Lakers…

              Imagine we could make oil out of air….

              Imagine we could turn lead to gold….

              Imagine we could fly like birds….

            • InAlaska says:

              Brutal food chains are pretty much standard. I can’t imagine a universe where life doesn’t require death. They are two sides of the same phenomenon. I’ve watched grizzly bears rip the eggs out of still living salmon. I’ve seen a pack of wolves hound a caribou to death by biting and tearing its hindquarters for three days until it collapsed from exhaustion and blood loss. I saw a moose beat a wolf to death with its front hooves, as the wolf bit into the moose’s neck and refused to let go. After the wolf died, so did the moose. Life=Death.

      • Yorchican says:

        Plants directly consume microbes too

        Plus all plants have their own fierce competition for sunlight.

        There are no innocents in the battle for survival.

    • Fast Eddy says:

      So when collapse hits and I am starving … can I just dig a hole … water it … and stand in the hole bare foot for a few hours a day … and I won’t need to eat?

      I am finding it hard to imagine that this could work….

      • doomphd says:

        From an Archean point of view, you and your cousin, a rubber plant, or an oak tree, are not all that different, and should be able to live similarly. However, you and I have evolved too far from plants to make a living that way. Maybe as a Venus Flytrap.

        All this BS being slung about here is from Ruppert’s misconception and judgement of the food chain as being “brutal”. Too bad the knowledge and reasoning abilities of his old neighbor (Wallace) didn’t rub off on him.

        • Rupert says:

          > Ruppert’s misconception and judgement of the food chain as being “brutal”.

          If you ever get eaten by a tiger, I’m sure you will find it brutal, my friend. You are too stuck in the MSU (main stream universe) and too used to being at the top of the food chain.

          • doomphd says:

            Eventually, something always gets us. We can dominate the rest of the food chain to the point that only an occasional shark or even rarer terrestrial carnivore (of those still extant, perhaps a brown bear) gets us for a meal. Usually, we get “consumed” by a bacteria or virus, or we are consumed by a cancer or just wear-and-tear our cardiovascular system until something breaks. The former is indeed painful in most cases, and the latter is like drowning in our own fluids, as the lungs can no longer clear. Based upon my late mother’s eyewitness account of my late father’s final heart attack, it was extremely painful and not a fun way to die. She died the same way many years later, but supposedly in her sleep. Perhaps, but a lot of folks are probably going to experience death like Marlon Brando’s exterminator character in the film The Missouri Breaks: “Wake up, time to die!”

            • Rupert says:

              > Eventually, something always gets us.

              Of course we must all die. Who’d want to live for ever anyway? And if we didn’t, we’d take up even more space, and eventually there wouldn’t be enough food or water or oxygen to support us anyway. Then again, you have reports of NDEs (near death experiences) and OBEs (out of body experiences), when the ill person suddenly finds himself/herself up at the ceiling, calmly looking down at his/her pain-racked body. And supposedly our bodies produce natural endorphins at the end of life. Some dying people, who were saved by doctors and surgeons, have described the dying process as the most sensuous and beautiful experience, and they were often furious with their doctors for bringing them back. But all that is a mystery, so who knows what really goes on,

            • “Who’d want to live for ever anyway? ”

              Immortality, in exchange for sterility, would be a nice trade off. I think beings that live forever would more responsibly manage … well, pretty much everything. Less short sighted. No exponential population growth until collapse.

          • Rupert says:

            Matthew wrote: “Immortality, in exchange for sterility, would be a nice trade off.”

            The things that some people wish for…

            > I think beings that live forever would more responsibly manage … well, pretty much everything.

            Or maybe not : “Sixty-million-year old man arrested on suspicion of molesting teenager”.

  24. Rupert says:

    Tim Groves said:


    “I share Rupert’s misgivings about the system in which living things that don’t “want” to be eaten alive nevertheless do get eaten alive, and personally I’m sickened by many of the practices of industrialized factory farming. However, if we look at the situation from a less sentimental perspective…”

    First of all, we are all sentient beings, therefore by default, most of us, unless we are psychopaths, will be prone to some element of sentimentality. After all, one of our common aims here would be to alleviate suffering, primarily of humans, and then of related creatures. We call that “progress” – or at least that is part of what we consider progress. Admittedly, we are more sentimental about mammals than flies, for obvious reasons.

    Tim Groves further said:

    “…none of us have ever-suffered more than a single individual human can suffer. There is a limit to what any one of us can suffer. Even an extremely empathic person cannot absorb all the suffering they intuitively empathize with in the creatures around them. They have their maximum capacity too. In this respect, suffering is a totally subjective experience”

    OK, let me bring in a Doctor Mengele-type person to operate on you without anesthetic. He did this to children – now it’s your turn to suffer to the max. After all, it’s only a subjective experience! I would argue that all each of us have is our subjectivity. What is reality, after all? Reality, in my terms, is what I experience. That’s all I have. Reality, in your terms, is what YOU experience. Some things we have in common, because of our phenotype: we experience pain (leaving aside the tiny number of humans who do not).

    So, now to suffering and cruelty. The “cruelty” of animals eating one another stems from their instinct – they need to eat to survive, and they have evolved to eat other species. Humans also need to eat to survive, and generally our killing of birds and mammals to achieve this is usually kept well out of sight. However, some humans are also capable of great malevolence and sadism – they kill and torture for pleasure. That much is down to our free will, which must always exist. However, animals kill for food because it is in their nature. And therefore in NATURE generally. They are trapped in the system. They are trapped in their subjectivity – as are we – so still we – and they – can feel pain. Agonising pain. There is no way around that – it is baked into the universe, and into life on Earth. If we inhabit a multiverse, surely there is some universe in which this is not necessary – in which all beings exist on sunlight and do not suffer excessive pain. Because here, I repeat, the food chain, and all the cruelty and suffering that that implies, is at the heart of the system – the biological system – and we cannot escape it. I ask again, would YOU construct such a system, given that subjectivity is all each one of us has?

    In thinking about the universe, time and again I am struck by “duality” – opposites and partners. Man and woman, human and beast, good and evil, heaven and earth. Perhaps suffering was created as the necessary opposite to love – without suffering, could we truly understand and value love? Yet still I would not create a universe like this. The Gnostics, after all, thought that the world is the creation of the demiurge – a half-god who thought himself a real god and made a mess of creation – unaware even after the act that he had created a mess. And still I am appalled by the idea that everybody has to eat everybody else to survive. If you were not at the top of the food chain, you might not be so blasé about “subjectivity”.

    • Yorchichan says:

      Pain evolved so that living creatures avoid things harmful to their survival chances.

      Have you read Dawkins’ Selfish Gene? It’s impossible to imagine a universe where altruism increased ones chance of passing on ones genes but selfishness did not.

      • hkeithhenson says:

        “Have you read Dawkins’ Selfish Gene? It’s impossible to imagine a universe where altruism increased ones chance of passing on ones genes but selfishness did not.”

        You have to be very careful in making such statements. “Selfishness” in terms of genes can induce behavior that looks to be altruistic but is selfish from the viewpoint of genes. Mother cat defending her kittens is just the start, see Hamilton’s rule.

        • Yorchichan says:

          Agreed, I was a bit loose in my statement. It’s selfishness from the gene pov that pays dividends in the struggle for survival. Usually the interests of the individual and gene coincide, but not always.

          • Rupert says:

            Still nobody is getting it. It IS possible to imagine a universe (but not THIS one – which is what you are doing) in which the energy source is NOT other beings. As simple as that. After all, plants on this planet subsist on sunlight only – though the Venus fly trap does kill and consume other beings. Imagine instead a universe where it would soon be noticed that trying to eat your fellow beings had bad effects – just as cannibalism brought kuru:


            to the Fore tribe of Papua New Guinea.

            Why is it so hard for people to think outside the box?

            • Fast Eddy says:

              If you can point us to a real world example of where this exists…. then maybe we could indulge you in this out of box experience.

              Otherwise we are back to the ‘if only I was 7ft tall’ scenario…..

          • hkeithhenson says:

            “Usually the interests of the individual and gene coincide, but not always.”

            Indeed. My background is electrical engineering, but of the last half dozen peer reviewed papers I wrote, two of them are on evolutionary psychology. The last one, “Evolutionary psychology, memes and the origin of wars”, goes somewhat into the reasons people have wars at tall

            I have an uncompleted article on a simple model for the long term selection of traits that lead to wars. It turns out to be an example of a trait that on average was 37% better for genes to go to war with neighbors than for half of the band to stave in place during a famine. There was no statistical advantages for those fighting.

        • Stefeun says:

          What if genes weren’t the drivers of Evolution, but merely records of what has worked best?
          Is the gene most important, when its expression can be inhibited by environmental conditions (epigenetics) or depends on the other genes around it (epistasis) ?

          A good article about that (with a bad title, I’d have tited it “The Social Life of the Selfish Gene”):

          One can also refer to the controversy between R.Dawkins and S.J.Gould, who thought that organisms were more important than genes in selection (among many other interesting ideas):

          Selection can even operate at the group level (see https://en.m.wikipedia.org/wiki/Group_selection) in some cases, which btw makes a bridge and can help better understand human cultural and social evolution. To summarize, the gene doesn’t seem to be the alpha and omega of natural selection, I’d rather go for Multi-Level Selection Theory in which different levels (gene/cell/organism/group) interact and get priority depending on the context. Not very simple…

          • hkeithhenson says:

            “What if genes weren’t the drivers of Evolution, but merely records of what has worked best?”

            I think Richard Dawkins would agree with you (and me) that that’s a reasonable statement. When we use the shortcut of “language of purpose” we have to remember that genes are not conscious agents.

            However, group selection fails to pass a logic test. Much as we might like it to be so, it just does not work out logically. Nothing has been proposed that I know of where group selection leads to a different prediction than standard gene centered selection.

          • Van Kent says:

            Stefeun, I also like the Multi-Level Selection idea. That would explain epigenetics and epistasis. I think we will need more information about hybrids vs. full bloods in different evolutionary bottleneck circumstances to get a better view of the full version of the story.

          • kesar0 says:

            The vast majority of people believe that there are only two alternative ways to explain the origins of biological diversity. One way is Creationism that depends upon intervention by a divine Creator. That is clearly unscientific because it brings an arbitrary supernatural force into the evolution process. The commonly accepted alternative is Neo-Darwinism, which is clearly naturalistic science but ignores much contemporary molecular evidence and invokes a set of unsupported assumptions about the accidental nature of hereditary variation. Neo-Darwinism ignores important rapid evolutionary processes such as symbiogenesis, horizontal DNA transfer, action of mobile DNA and epigenetic modifications. Moreover, some Neo-Darwinists have elevated Natural Selection into a unique creative force that solves all the difficult evolutionary problems without a real empirical basis. Many scientists today see the need for a deeper and more complete exploration of all aspects of the evolutionary process.


            Paul Nurse, president of Rockefeller University:
            “Maybe biology is on the edge of something similar to 1905 physics with the emerging complexity of biological systems — in fact, a move from straight forward linear causality. And I wonder whether biology may go through a revolution in the coming decades.”

            Those coming decades are doubtful, unfortunately…

      • Fast Eddy says:

        I was thinking about teeth and pain yesterday (because my wife has sensitivity in a tooth that needs to be looked at)

        Why is it teeth need to have nerves inside? Why can’t they just be the same as fingernails or hair….. they feel nothing … and they keep growing ….

        You get a cavity you just take out file and grind it off… or you cut it off and let it grow out again

        I don’t get this tooth thing. Someone really screwed up.

        • Ed says:

          FE, my guess is it goes back to fish. If you kill your food with your teeth you need to know “am I winning or is the prey about to rid my teeth out of my mouth?” In the latter case you feel pain and open your mouth and flee. We humans no longer hunt this way. By the time food reaches our mouth we know it is dead and harmless. Evolution does not quickly give up a feature.

          • Fast Eddy says:

            That makes sense.

            Then I like the shark model — instead of only two sets of teeth — we could have infinite sets…

  25. Yorchichan says:


    Happy New Year! Many thanks for your great blog. Your articles are very clear and the replies you make to comments show your vast knowledge of both energy and financial related matters.

    I am tempted to ask you for any forecasts for the year ahead, but having just re-read JHK’s forecasts for 2015 I think I’d better not 😉 You drop plenty of hints that you believe the financial system cannot survive for many more years anyway.

  26. Fast Eddy says:

    The Prize: The Epic Quest for Oil, Money, and Power

    I used to see Daniel Yergin as a shill for oil — but that was long ago — since there is no alternative then a shill is necessary to ensure we pump and burn every possible drop of oil…

    So I am open to reading this — but wondering if it is just a shit load of spin that the Elders gifted a Pulitzer to ensure it was read – and given some gravitas….

    Anyone read this? Worth reading?

    • Kylo Ren says:

      Haven’t read it but purely by coincidence started watching this the other day…


      After finishing that I’ll tuck into the video documentary version of The Prize…


      Then I may look into The Quest: Energy, Security, and the Remaking of the Modern World – Yergin’s 2011 follow up book to see if there’s a video version of that.

      From Wikipedia…

      Reception of The Quest has been generally positive,[8][9] with Asahi Shimbun listing it as a Book of the Year.[10] Praise for the book has predominantly centered on Yergin’s coverage of the energy system,[6][11] with the New York Times referring to the book as “necessary reading” and The Economist calling it a “comprehensive guide to the world’s great energy needs and dilemmas”.[4][5]

      Critiques of The Quest most often fall into three main categories.[12] Some critics commented on the book’s 800 page length, noting that it was not necessarily for the casual reader and that it felt like several different books in one.[4] Others faulted Yergin for his impartiality and not taking a strong position on subjects such as climate change,[13] although the Wall Street Journal said that the book succumbed to “the conventional alarmist storyline” on climate.[14] Finally, peak oil advocates take strong issue with Yergin’s handling of the subject in the book, particularly the discussion of the founding of the peak theory and the potential for future oil discoveries.[15][16]

      …. although I feel this is more relevant to where we are now, it does seem to end with the same old list of “solutions” that have been derided to death on this blog…

      New Energies, the fifth section, focuses on the “rebirth of renewables” and the role of energy efficiency. The final section, The Road to the Future describes the evolution of personal mobility and the growing global demand for automobiles. Yergin covers the topics of 3rd and 4th generation biofuels, hydrogen fuel cells, natural gas vehicles, and what he calls “round two in the race between gasoline and the electric car.” The book concludes with a discussion of the impact of the “globalization of innovation” on future energy supplies.[7]

      So nothing new there…

      I did find the space based solar discussion interesting, especially the feasibility and cost achievements once the importance of cost is factored in but the possible problems with atmospheric damage etc already hint at unknown factors that would lead to disappointment even it were ready to implement today.

      • hkeithhenson says:

        “but the possible problems with atmospheric damage etc already hint at unknown factors that would lead to disappointment even it were ready to implement today.”

        The atmospheric damage is almost all ozone damage from the nitrogen oxides produced when the vehicles reenter. Several PhDs from NOAA have been looking into the problem for more than a year and have burned hundreds of hours of super computer time. The paper isn’t out yet, but the preliminary results don’t indicate a showstopper.

        • Rick Grimes says:

          I’m not sure which show you’re watching – Interstellar possibly? 😉

          You say the paper isn’t out yet. What kind of timeframe are we looking at for preliminary testing of this system and how long would it take to ramp up to supplant lets say 50% of current energy use worldwide?

          Given the current economic situation and geopolitical forecasts, do you consider these kinds of as yet untested bluesky solutions to be realistic?

          • hkeithhenson says:

            “What kind of timeframe are we looking at for preliminary testing of this system and how long would it take to ramp up to supplant lets say 50% of current energy use worldwide?”

            It takes about 3000 standard (5 GW) power satellites to displace the 15 TW of fossil fuel humans use today. After working up to a production rate of two TW/year, it would take 3-4 years at that rate to reach 50%. The pacing element may be production of Skylon in large numbers. The first one is expected to be flying by 2025, but a large commitment could bring that forward by a few years. With a fast ramp up, humans could be entirely off fossil fuels by the early to mid 2030s.

            “Given the current economic situation and geopolitical forecasts, do you consider these kinds of as yet untested bluesky solutions to be realistic?”

            For the US, probably not. But the US is not the only place in the world where the infrastructure to build power satellites could be developed.

            • Fast Eddy says:


              The project was not continued with the change in administrations after the 1980 US Federal elections. The Office of Technology Assessment concluded that “Too little is currently known about the technical, economic, and environmental aspects of SPS to make a sound decision whether to proceed with its development and deployment. In addition, without further research an SPS demonstration or systems-engineering verification program would be a high-risk venture.”[26]

              In 1997 NASA conducted its “Fresh Look” study to examine the modern state of SBSP feasibility. In assessing “What has changed” since the DOE study, NASA asserted that the “US National Space Policy now calls for NASA to make significant investments in technology (not a particular vehicle) to drive the costs of ETO [Earth to Orbit] transportation down dramatically. This is, of course, an absolute requirement of space solar power.”[27]

              Conversely, Dr. Pete Worden claimed that space-based solar is about five orders of magnitude more expensive than solar power from the Arizona desert, with a major cost being the transportation of materials to orbit.


              As we know — without subsidies there would not even be solar in the Arizona desert.

              Shall we return to the discussion of how if I were 7ft tall I’d have a shot at centre for the Lakers?

              How I’d give all you guys ring side tickets for free…. how you could all say to your friends ‘I knew Fast Eddy when he was on the FW blog — I remember how he said he was going to work out how to grow over a foot and be the next centre…. isn’t it amazing how he did it — if he can do that I bet we can also replace fossil fuels with solar power from space — if a mature adult can grow over a foot then surely it is very simple to make space solar power work — we CAN do IT!!!’

            • hkeithhenson says:

              “As we know — without subsidies there would not even be solar in the Arizona desert.”

              If power satellites cannot be built without subsidies, then they should not be built at all. I don’t know where Warden gets 5 orders of magnitude. The Boeing study in 2009 came in at $1.81 per kWh, that’s only two orders of magnitude too expensive. It certainly does require reusable vehicles to get the cost down to where power satellites make economic sense.

            • Fast Eddy says:

              I think it is quite obvious that they are not going to be built with — or without — subsidies.


      • Stilgar Wilcox says:

        That video claiming bad people like Rockefeller got us hooked on oil is absurd. Does anyone really think once the energy content and multiple other uses were available by extracting oil it would have remained in the crust? People are willing to do anything to make money. Many species are extinct because they were more valuable dead than alive, so why would oil get ignored. As a species we have no moral high ground. Even a rare black sable cat in the wild has a price tag set for it by the African country it resides in for a wealthy hunter. As individuals me may make moral decisions, but as a species there is always someone willing to do anything for a price.

        • bandits101 says:

          It’s not absurd at all. http://www.history.com/topics/john-d-rockefeller
          Standard Oil took control of 90% of US refineries and pipelines. “Standard Oil did everything from build its own oil barrels to employ scientists to figure out new uses for petroleum by-products”.

          All perfectly legal until the Sherman Antitrust Act. You are correct though, the exploitation of oil took a natural course and was a perfect vehicle to support Capitalism, especially the system within The United States.

        • Fast Eddy says:


          Oil is really addictive… it allows us to travel around the world in a matter of days instead of years… it gives us food and medicine and nice warm/cool homes… and gadgets … and teevee … and movies… and toothbrushes… etc etc etc…

          I don’t think we needed a pusher to convince us that oil offered the Supreme High. There really is nothing like it

          • psile says:

            Indeed. Most people who are ignorant of oil’s profound power (99.99% of the pop.) fail to realise that oil IS the FREE energy source we’ve been looking for all this time. A dream come true for our species. And look what it has wrought…

          • Artleads says:

            This is a good point. We need to love what it has done, appreciate it properly. That’s a first requirement, I think. Our cultural arts have not looked at oil that way.

    • InAlaska says:

      I read it. IF you like a history lesson its fine, but otherwise if you’re looking for insights into Peak Oil you’ll find it boring.

  27. alturium says:

    Happy New Year Gail and OFW Folks!

    Sorry I haven’t been around, just not enough time in the day for the most interesting people on the ‘net.

    Quick comment (I can’t resist)…there seems to be a lot of inertia in the global economy…as we sort of round out at the top of the plateau…or we are moving through the eye of the hurricane.

    May the odds ever be in your favor!

    • Thanks! We seem to be headed toward a worrisome part of the cycle. We can see where we are headed down in the near term, but it is not something we can do much about, and it all plays out slowly and unpredictably.

  28. dolph911 says:

    Although not a fast collapser by any means, let me gently remind people of the situation vis a vis the year 2016.
    1) 7.3 billion humans above ground, more and more of them connected to the matrix every day, and every single one of them, including the old and sick, wanting more life and more wealth for themselves, their families, and nations, at the expense of whomever they can acquire it from
    2) In the course of a century we have rapidly depleted the best stocks of ancient sunlight that took hundreds of millions of years to form fossil fuels, and what’s left is extremely hard to get and difficult to produce
    3) As a consequence of number 2, the planet’s oceans and atmosphere have been supercharged, creating unpredictable and often severe weather events throughout the world at a frequency never before witnessed
    4) The most money grubbing and power hungry civilization in human history (United States) is dedicated to infinite expansion and grabbing whatever it needs to power its multifarious welfare/warfare/corporate state, and is thereby dedicated to infinite war against some of the most tribal, most religious people in the world (Muslims) who happen to be sitting atop much of the remaining stocks of energy
    5) The financial system of the world is based on creating infinite debts denominated in symbolic units called fiat currencies which can be created at will, with no tether to the underlying physical economy, and all of us work every day for more and more of these units which are being debased every day, forcing us to work even more; as a result, vast income inequality and serial asset bubbles/busts are created, transforming the global economy into a giant casino
    6) And not only that, but virtually all people in positions of power in governments, banks, and major corporations, referred to loosely as TPTB, insist to all of us that our present system is the only possible system, that no alternatives exist, and they will ruthlessly do whatever it takes to continue the growth of our system, including the use of force from police and military forces, to suppress any dissent until every last material is dug up and extracted and used up in some form or another, as fast as it possibly can, and if you object to any of this, you are a cynic, negative, pessimistic, paranoid, conspiracy kook, and you better get in line and work and consume, or they will take away your home and livelihood and savings at the point of a gun

    You cannot reflect on the above and not be a doomer, in my humble opinion. Given the above, you cannot be an optimist, at least that’s the way I see it.

    Happy New Year!

    • You need to recognize that once one system is in place, changes are very difficult. In fact, a lot of what is in place seems to be necessary, including the financial system. The changes we can make are very small, whether we like it or not. I wouldn’t blame current leaders.

    • Artleads says:


      As long as it works (a non theoretical position) change should be OK. It’s workability and success that I see as important; not just the idea.

      A new system has to take seriously the details of the current one. It has also to start small and quietly. A great deal of the old physical (and probably, other) infrastructure might be usable in the new system. No clean breaks, I think. A new sort of hunter gathering uses everything it can, IMO.

  29. Pintada says:

    I think that it is very important for me to maintain the net metering that I have enjoyed for the past several years, and at at the same time be prepared to go off the grid if the company from whom I get power is allowed to void my contract with them as Buffett voided his contracts with people in Nevada. For me, it will mean having a completely redundant set of inverters, battery controllers and batteries.

    When the oligarchs win, evil wins. It would be nice to be able to trust a legit contract signed in good faith. Not in this empire.

    • You want your subsidies to continue. In fact, you want the electric grid to continue. Don’t you realize that the subsidies that you are getting are one of the things that pushes the financial status of the electric grid toward failure–namely financial failure? There is no way that the mandated subsidy of net metering makes sense.

      • Pintada says:

        You forget, dear Gail, that I’m the guy that wants BAU to end. Your appeal to my sympathy for the poor misunderstood power companies is not terribly effective. 🙂

        I fear though that I was a little grumpy last night and took it out on a very nice gentleman that I should not have taken it out on. Thank you for erasing my inappropriate post. In the 5 stages of grief (for our civilization) I can maintain acceptance pretty well. When the oligarchs threaten me and mine personally, the anger returns in spades.

    • Pintada says:

      I signed a contract with the power company. They were very eager to get the tax and other incentives offered by the Federal government at the time. If you or I want to void a contract that the other party does not want to void what would be our recourse?

      Right, you and I would have none. The oligarchs do have recourse, all that they have to do is pay off some more bureaucrats or politicians and viola the contract is void.

      • ” If you or I want to void a contract that the other party does not want to void what would be our recourse?”

        This is certainly a problem. If it is apparent that continuing with the existing contract will inevitably lead to the destruction of one of the parties, doesn’t it make sense that the contract must be renegotiated?

        Rather than having a company negotiate with a million individual people, doesn’t it make sense to have a group, such as a regulator or legislators, handle negotiations on behalf of the million people?

        Imagine if you had to put everything on hold and have arbitration with a million individuals. If it took one hour of your time per person, that would be about 114 years. If you only did it 8 hours per day, 342 years would be spent in arbitration / negotiations / court. Obviously, it is impossible for you to stop everything, and sit down and do that.

        If you had 100 teams of employees handling it, then it would still take over 3 years. There is no way to freeze time and stop losing money for 3 years while you sort this out.

      • Pintada says:

        Here is another example of corrupt utilities gouging their customers.


        Matthew said, “If it is apparent that continuing with the existing contract will inevitably lead to the destruction of one of the parties, doesn’t it make sense that the contract must be renegotiated?”

        Lets see about that with some examples. If I am sick, and go into the hospital and run up more medical bills than I can’t pay, do I get to “renegotiate”? No, the doctors, hospital, perhaps even medicare rushes in and takes everything that I might have. House, car, savings, even personal property.

        If I buy a house that I cannot afford, does the bank “renegotiate”? No, the sheriff comes out and puts me and mine in the street.

        If I buy a car that I cannot afford …

        You get the picture, and I suspect that you knew that was the case when you made your comment.

        “… doesn’t it make sense to have a group, such as a regulator or legislators, handle negotiations on behalf of the million people?”

        Matthew is now saying that because the utility might be inconvenienced that they have the right to rip people off. If they want to steal billions from their customers so that they can pay dividends to their shareholders, do we not have the right to ask that they be inconvenienced at least a little, by hiring a few temporary workers?

        The utility with which I have a contract got billions of government largesse as a direct result of the contracts that govern the net metering system in my state. When they arbitrarily void my contract will they be forced to pay that money back? Of course not. Of course, they would’t have a lot of the money since my guess is that public utility commissioners are pretty expensive.

        • Pintada says:

          I’m such an idiot sometimes. I left off the best example of all:

          If I don’t pay my utility bill, doesn’t the utility come out and shut off my power? Winter, summer whether I can live without the power or not, they are there johnney-on-the-spot and they turn it off.

          • Fast Eddy says:

            I saw that article — they are not exactly making money:

            ‘The thing is, despite the juicy rate increases imposed at the beginning of 2015, operating revenues have fallen about 1% so far in 2015, as Californians use less energy from their beloved utilities. It’s an existential struggle all utilities face.’

            No doubt that is related to grid-tie ins…. paradox — the more you succeed — the more you fail….

          • “I’m such an idiot sometimes. I left off the best example of all:

            If I don’t pay my utility bill, doesn’t the utility come out and shut off my power? Winter, summer whether I can live without the power or not, they are there johnney-on-the-spot and they turn it off.”

            You, in turn, are free to stop sending power into the grid, and free to stop using the grid.

      • Pintada says:

        I hear on this site and others that PV solar can never replace fossil fuels as a power source for society. And now I find – in direct contradiction – that there is so much PV solar that the poor defenseless utility companies cannot hold their own against the constant onslaught of the PV solar installers.

        Which is it? Should society increase the already huge subsidies given to the fossil fuel companies so that they can compete? Should utility rate payers be thrown under the bus as they were in Nevada?

        The answer in my mind is completely clear. PV solar is a great way for an individual to buy and store a relatively large quantity of fossil fuel energy. Those people fortunate enough to be able to do so are frightening the oligarchs. Regardless of the fact that PV solar only accounts (will only ever account) for a small amount of the power generated in a given state the oligarchs are unwilling to give up even a small percentage of their profits. So watch out if you have tried to provide a reliable source of power for yourself and your family – the corrupt bureaucrats and oligarchs that pull their strings are coming for you.

        I can go off grid, but I signed a contract. So now are they going to take the power I generate without paying for it but mandate that I stay on the grid? In other words, they have the power to void only that part of the contract that requires them to do something while the part that requires me to do something will remain in effect.

        There will be class action suits to correct the injustice in Nevada. It will be very interesting for me to see the outcome.

        • Fast Eddy says:

          A couple of issues here — PV systems barely generate any nett energy — the amount of energy that goes in — is pretty much what you get out of them over the life span of the system.

          So basically you burn up 20 years of coal making the system — and you get the same amount of energy drip fed out over 20 years.

          If you are concerned about global warming then you really should not buy solar systems.

          I don’t care about global warming so I bought panels to power a solar irrigation pump. That cost around $15,000 — a HUGE waste of money given I could run a normal pump using grid power for a few hundred dollars per year. But there will be no grid soon so….

          With regards to the grid tie in contracts…. the obvious problem is that solar power does not work in the dark and is not very efficient in the winter… so when the sun ain’t shining you still need to provide power to homes and businesses…. you have to have the exact same infrastructure that would be required if there were no tie in….

          So when solar feeds in you pay people for that energy —but in the meantime you have all the gear in place to generate 100% of what is needed… yet it sits idle some of the time — you have to pay for this gear no matter what.

          So basically you are paying nearly twice to produce power.

          The more people that feed in the higher your costs become…. you can’t pass on these costs to the consumer without them raising hell…

          So you do what you have to do — you ‘renegotiate’ the contracts….. or the electric utility goes out of business.

          There’s that saying about ignoring reality but not being able to ignore the consequences of reality…

          This is one of those times when the consequences suck… people took the subsidies (which NEVER should have been offered) — thinking they’d get their cake and eat it too…. they did not consider that the more people who tied-in the less feasible the entire concept became…

          Well— the reality is there — the contracts are worth nothing — and the more people follow the leader the less the utilities will pay ….

          There’s a paradox in this situation … isn’t there….

          • Pintada says:

            FE, “So basically you burn up 20 years of coal making the system — and you get the same amount of energy drip fed out over 20 years.”

            Yup (well … we both know that and EROEI of 4:1 it isn’t quite as bad as you say but, for brevities sake I’ll give it too you). No fossil fuels available, grid down, I’m still feeding my family and maybe even a friend for up to 20 years – quoth Fast Eddie. Hurray!! Hopefully, the grandkids can learn how to raise cattle so that they don’t need the electricity, but I will have given them a chance …

            FE, “— a HUGE waste of money given I could run a normal pump using grid power for a few hundred dollars per year. But there will be no grid soon so….”

            I simply do not get and will never get why it would not be good for you to be able to use that pump after the grid goes down – and it will go down whether they honor their commitments or not.

            FE, “you have to have the exact same infrastructure that would be required if there were no tie in….”

            Batteries dude. And live where there is a good solar resource.

            The sooner the utilities go down, the better off the ecosystem will be. If they go off soon enough, there will be largish mammals left on the planet after the dust settles. If my tiny bit of solar power brings them down 1 day sooner and I save one species of rodent thereby … fantastic!

            • Fast Eddy says:

              I am hopeful that we can continue to burn as much coal as possible and keep the current system going for as long as possible.

              Print pillage and burn —- Long Live BAU!

        • “I hear on this site and others that PV solar can never replace fossil fuels as a power source for society. And now I find – in direct contradiction – that there is so much PV solar that the poor defenseless utility companies cannot hold their own against the constant onslaught of the PV solar installers.”

          Does your solar PV system provide the same amount of power, 24/7?
          What do you think happens when there is less or no sunshine?
          Perhaps you should start with a few articles on the matter. A good place to start would be:
          Particularly #7

          “Should society increase the already huge subsidies given to the fossil fuel companies so that they can compete? ”
          Besides ignoring the negative externalities, what subsidies do the fossil fuel companies receive? Normally, governments receive royalties or other taxes on fossil fuel extraction.

          “PV solar is a great way for an individual to buy and store a relatively large quantity of fossil fuel energy. ”
          Yes. Buying an off-grid PV system with battery backup is a great way to prepare for the loss of the grid. It may increase your odds of surviving the crucial first few years post-collapse.

          “Regardless of the fact that PV solar only accounts (will only ever account) for a small amount of the power generated in a given state the oligarchs are unwilling to give up even a small percentage of their profits. So watch out if you have tried to provide a reliable source of power for yourself and your family – the corrupt bureaucrats and oligarchs that pull their strings are coming for you.”

          They aren’t stopping you from making your own energy. They just don’t want to pay you four times what your excess energy is worth. The value of electricity to the distribution utility is the price they buy it from the coal and natural gas power plants – around $0.03 per KwH, not the ~$0.10 you pay for delivered electricity.

          “So now are they going to take the power I generate without paying for it but mandate that I stay on the grid?”

          I would like to see the original contract, along with the details of the PUC ruling.

          “There will be class action suits to correct the injustice in Nevada.”

          Well, at least that is a more practical way for so many people to resolve the issue together.

          • Pintada says:

            Matthew, “what subsidies do the fossil fuel companies receive?” I assume that you ask that to be cute in some way. It went over my head.



            Matthew, “Yes. Buying an off-grid PV system with battery backup is a great way to prepare for the loss of the grid. It may increase your odds of surviving the crucial first few years post-collapse.”

            Yup. Actually, Fast Eddie thinks I might have bought as much as 20 years. I am hoping and preparing for more. Redundant backup parts, etc..

            “They aren’t stopping you from making your own energy.”
            Not yet, that’s my point. If the precedent set in NV is allowed to stand, they will just keep taking …

            And, they don’t pay me anything for the power I produce, and never have. In fact, the idea that any utility company actually pays for any noncommercial solar generated power is a myth perpetuated by the companies. If you generate less power than you use, as 99.9+ percent of the rooftop solar systems do, then your bill is reduced a little. If you generate more power than you can “naturally” use as I do, you have the choice of giving the excess to them, or heating with electricity and turning up the thermostats. Which do you think I do?

            • I see calculating energy subsidies for fossil fuels is about the same as calculating EROI; everyone uses a different methodology and comes to a completely different number. That seems wonderfully useless.

              Let’s ignore the negative externalities subsidies for now.

              “The IEA’s latest estimates indicate that fossil-fuel consumption subsidies worldwide amounted to $548 billion in 2013, $25 billion down on the previous year, in part due to the drop in international energy prices, with subsidies to oil products representing over half of the total. Those subsidies were over four-times the value of subsidies to renewable energy and more than four times the amount invested globally in improving energy efficiency.”

              Ok, so going with Gail’s chart:

              And assuming that the IEA includes hydro in its renewables, Oil gets double the subsidy that renewables do, and produces three times as much energy. So, renewables are more subsidized per energy unit than fossil fuels.

              “they don’t pay me anything for the power I produce, and never have”
              “Which do you think I do?”

              Wait, so, you are upset they are abolishing net metering (or, reducing the deduction), but you don’t even send excess electricity to the grid?

              Look at it this way. You are the grid company. You buy electricity for $0.03, transfer it at a cost of $0.06, and sell it for $0.12. Now, some of your customers get solar. So, when they produce extra electricity, you reduce their bill by the $0.12, transport that electricity at a cost of $0.06, and get paid $0.12 for it. At the very least, you lose $0.03.

              However, this is not unique; our entire society is infested with bad ideas that inevitably lead to ruin. Ideas that seem good in the short term, but after enough time, eventually collapses. Pensions, CDS, subprime mortgages, ZIRP, it is all different forms of the same underlying flaw.

            • Fast Eddy says:

              ‘However, this is not unique; our entire society is infested with bad ideas that inevitably lead to ruin. Ideas that seem good in the short term, but after enough time, eventually collapses. Pensions, CDS, subprime mortgages, ZIRP, it is all different forms of the same underlying flaw.’


            • Ed says:

              Matthew, I think solar into the grid is cost neutral. The solar home instead of buying 3 cents of electric and 6 cents of distribution to get the electric and 3 cents of profit pays nothing. Some other house down the street buys the 3 cents of electric and pays the 6 cents for distribution and 3 cents profit. It is neutral for the electric company.

            • Ed says:

              should have added the solar house gets 3 cents of credit which it will use later in the night when it buy electric. The distribution company does not care if it pays 3 cents to a house or to a giant electric factory. At least in New York State distribution companies and generation companies have been separated.

        • ejhr2015 says:

          Sounds exactly like what banks can do. Get their free money but obligate the borrower to pay for it with real work and assets.

      • Pintada says:

        My argument was simple. If a decent person enters into a contract, he follows through and honors that contract even if he discovers before the term is up that he was stupid in the first place. If a utility enters into a contract, well … .

        The problem with them actually honoring it is the words “decent” and “person”.


        In any event, I’m OUT on this subject.

        • Fast Eddy says:

          As we see – when it is convenient or necessary the Elders simply change the laws….

          I am all for breaking these contracts —- because if the utilities honour them we’ll quickly end up in a situation where they are insolvent — and the lights will go off — permanently.

        • “If a decent person enters into a contract, he follows through and honors that contract even if he discovers before the term is up that he was stupid in the first place.”

          Even if it means going bankrupt, losing your home, and being a starving person working 100 hours per week just to try to fulfill your contractual obligation?

          If the power grid goes under, everyone loses their power. Even a short blackout would not be fun. Of course, they would probably get a bailout or buyout anyways.

          BTW, sorry if I missed it before, but what were the terms of the original contract?

          • Fast Eddy says:

            I’d have a close look at the fine print … I can imagine there is a clause that allows them to do what they are doing….

          • Ed says:

            At least in New York State electric companies are regulated monopolies. They are guaranteed by the state government to make 9% profit on capital investment. If cost goes up price goes up. That is the contract.

  30. It is amazing, that even amongst the non-MSM, people have a hard time accepting things like dispatchability and the real costs of intermittent renewables.

    Check out this article from ZeroHedge, along with the comments and, if you are signed in, the upvotes. Lots of otherwise intelligent people who think Buffett is the devil for not wanting to pay 100% payout for net metering.


  31. Don Stewart says:

    Dear Finite Worlders
    Charles Hugh Smith explores the crisis in health care around the globe. Some of the problems are social (such as air and water pollution) while others are individual or family (such as bad diets). He quotes Chris Martenson and Adam Taggart:

    ‘As discussed in Chris’ and Adam’s recent book Prosper!, one of the most important components of true wealth is Living Capital — the most essential component of which is our own bodies. Prioritizing our investments there gives us the best foundation upon which to pursue all of our other future goals.


    This is one of the same messages that Montgomery and Bikle deliver in The Hidden Half of Nature.
    And the thinking is along the same lines I have described in terms of building capital. Building capital by design is a key element of permaculture. Lots of people converging on this notion.

    Don Stewart

    • I am struck by the extent to which obesity has increased since the 1960s. I don’t think we really understand all of the forces at work. I think the belief that we need more meat in our diets is part of the problem, also the low fat craze, and the oversize portion problem. Cutting out Omega 3 fatty acids from the food supply in the US has been another problem, as has all of the soda (diet and otherwise). Sending children to more distant schools has been a problem, because it cuts out walking to school. Also, all of the focus on testing in schools, and learning the basics, has eliminated exercise programs and recess for children.

      • Don Stewart says:

        Dear Gail
        You might like to take a look at The Hidden Half of Nature. The book is roughly divided into two part: microbes and gardening, and microbes and human health. There are many parallels between the two realms. The incentive to look into the health and microbes subject arose with force when Anne Bikle developed cancer. A friend in Denver put her on the trail of the microbes, and her reading of the literature opened her eyes:

        ‘I was agog. Bacteria, viruses, and more were at work in my body and Dave’s body in ways I never imagined. Not everything was an HPV-like menace; far from it. It turns out that immunity is partly about the quality of the environment in which microbes live—the lay of the land that is my body and every body. Human microbiome scientists spoke of an incessant dialogue between microbes and their hosts. Molecules were the words of their common language. And this conversation wasn’t just idle chatter. Microbes, especially those conducting their business in the gut, could shift a person’s immune response, the level of inflammation, and other aspects of their physiology every which way. ‘ (pg 125)

        ‘the number of microbial genes in our bodies could be as high as 6 million.’

        ‘But if you come from a hunter-gatherer group or a rural village in Africa or South America, your gut microbiome composition is quite different and far more diverse.’

        That’s enough of direct quotes to perhaps get your attention and suggest that our traditional ways of thinking are seriously flawed. For example, when you list the reasons why we have to have massive amounts of debt, much of it revolves around the notion that we have to put fossil fuels to work substantially altering our environment…tractors, for example. Yet tractors not only enable turning the soil which is guaranteed to result in soil erosion, tractors also enable us to do agriculture which gives us the microbiome of Westerners and the attendant chronic diseases. If you read more in Hidden Half, you will find strong evidence that we Westerners need to get our micro biomes back resembling those of the hunter-gatherers and the rural Africans and South Americans. The way Montgomery and Bikle do that is by gardening and also by buying at the local farmers market and by eating only whole grains.

        If we look at Singing Frog Farm in California, we find a revenue per acre of 25,000 dollars per year…eight times the California average. Yet they use little in the way of fossil fuel powered equipment on the farm. As I pointed out, the distribution channel is doubtless heavily dependent on fossil fuels. But the distribution channel from Bikle’s garden to the kitchen table is very short and doesn’t depend on fossil fuels directly, and lightly for things such as preserving crops. The garden does not demand that this couple go deeply into debt…it does require some work and some time.

        The foregoing analysis suggests that the usual thinking about debt and fossil fuels is too shallow. Let me make a quick detour to Sherry Turkle and Reclaiming Conversation. Turkle claims, and supports with evidence, that the dominant uses of cell phones are inimical to human health. She does NOT claim that ALL uses of cell phones are harmful to health…just that the dominant use of them is. We have to conclude that humans are not wise enough to separate out the beneficial uses of technologies from the harmful uses. Just as the United States government has been incapable of legally distinguishing between the indiscriminate use of antibiotics for feedlot animals and the use of antibiotics in surgery wards. And I would add that we have not demonstrated the wisdom to use fossil fuels ONLY when it is a net positive to do so.

        You mention the fact that consolidated schools result in less walking for children. Yet those consolidated schools are enabled by fossil fuels. The generation which is dying now frequently went to one room schoolhouses in Oklahoma where I grew up. Despite the indignity of having to walk to school, they seem to have coped with the Dust Bowl, the Depression, WWII, Korea, and the enormous changes brought about by the post-war boom.

        I do understand the legal structure which keeps everyone in servitude to debt. But to claim that debt is necessary to live a good life is, I think, a failure to count the costs incurred by a society built on fossil fuels.

        To bring up two favorite whipping boys here. Thoreau thought that it was better to live in a wooden box discarded by the railroad than to go into debt to build a house. The Nearings chose cheap places to homestead because they saw the dangers of debt.

        Don Stewart

        • MJ says:

          The Nearings also saw the dangers of modern processed foods. They were fanatical regarding their gardens, growing without poisons, artificial fertilizers and building the soil with compost. They realized the key to healthy, disease free plants was a rich, alive humus.
          One other aspect of debt was the manner in which they approached livelihood.
          They would forecast their financial requirements for the upcoming year and after they met that mark would devote their talents and energies to other endeavors. Unlike contemporary mindset of making and consuming as much as possible, they refrained from participating in the modern economy as much as possible.
          The stone house building, along with other building projects, such as stone garden walls, was a form of recreation. Scott even dug by hand and shovel a pond, recording the amount excavated. The generation of the past with that discipline is long gone.
          Needless to say, this is only a brief account of the “good life” picture.

        • Increased debt (as well as growing wages of non-elite workers) is what enables the price of oil to stay high enough to extract it from the ground.

          I agree that from a personal perspective, having increased debt leads to a great deal of headaches. It doesn’t really work. The only way it sort of works is with ever-lower interest rates. Now these are going away as well, at least in the US.

      • Ert says:

        Hello Gail,

        it is indeed linked the additional consumption of meat, sugar but also dairy. But it is not the “low-fat” craze that adds to the problem, but instead the (unseen) “high-fat” craze. Historically the fat intake was very low (Okinawas: 6%, Germany in 18th century approx 16% of total daily calories, and so on). Today the average “Western” diet fat calories are around 35-40% of daily calories. Note: “low-fat” as product marketing is ‘bullshit’ – plants come as they are – and no one should fiddle around with them, adding or removing things. “Low-fat” primarily refers to heavily processed products (cakes, cookies, dairy, etc.) – and wants to make the bad look less worse.

        T.C. Campbell and others could link animal product and fat intake to a lot of health problems – by studying the evidence out there. All those things are now confirmed by more and more research. Also the WHO advocates a maximum of 30% fat in the diet- whereby lower is better. To get that fat intake no single drop of oil, fat, cookies, butter, etc. is necessary since every plant food comes with fat (yes, even a banana).

        You may use Dr. Gregers web site as a start: http://nutritionfacts.org/ – I think he currently presents the body of research that is out there the best. A whole and natural plant food diet (without adding “refined” oils) is what I successfully do and what is also confirmed by science and (current + historical) evidence.

        • ejhr2015 says:

          You are entering fraught territory propounding any dietary advice, Ert. What works for you is just for you. What works for me is just for me. My foods differ from yours, a lot. Yet I shed 25% of my body weight doing it and I now weigh what I weighed at 15.
          There is no mystery as to why we have an obesity epidemic. First up, food is cheap. The average westerner spends 10% of his/her weekly household budget on food. In more primitive cultures it could be 80%.
          Then we have the food industry itself to thank for the huge amount of processed products on the market. Then we have the marketeers and scientists as well, adjusting taste for the sweet spot so consumers will buy more. The science has overwhelmingly been directed by industry so that poor dietary choices are made popular. like the lo-fat craze. Good, solid science is rare.

          All these factors have set up the obesity epidemic, but at last we are cutting through the hype and in time sense will reassert itself. But we still overeat and portion sixes are up 400% on 50 years ago.

          • Ert says:


            I don’t want to extend on it. But proposing a primarily (whole) plant based (and fresh/unprocessed) diet (as it has been until the food industry took over) is kind of a no brainer – and all the science and also the (current and historical) evidence supports that.

            In addition, and if locally grown and adjusted, this would also reduce the energy footprint in the world, since (pre-)processing, transport, packaging, etc. pp requires/wastes a lot of energy and reduces the nutritional value of the ingredients. But this will itself sort out in time 😉

  32. Edit: Second paragraph, last sentence

    should read

    “…only a reconfiguring of the rankings of existing relationships and networks”


    • For the benefit of readers–“futuresystemsanalyst” is the same person as “contributor,” based on the e-mail address the individual is using. So what this message says is that instead of saying

      Where we go next is determined by past choices more than present ones. Believers in the power of human agency to achieve human goals also forget this; there is really no such thing as a true revolution, only a reconfiguring of relationships or networks.

      This section should read:

      Where we go next is determined by past choices more than present ones. Believers in the power of human agency to achieve human goals also forget this; there is really no such thing as a true revolution, only a reconfiguring of the rankings of existing relationships and networks.

  33. Contributor says:

    First time poster, Hello everyone! This is a bit of a tangental rant and scrolling past is excused 🙂

    I’ve been cogitating over Fast Eddy’s claims that collapse hasn’t come sooner because there are people in control who have done their darndest to prevent it. Players who determine central bank and economic policies, some kind of unelected inner sanctum banking clique, are seen as the saviours of our time (so far at least). It may seem a moot point to consider whether the course of our recent history is determined by design more than chance. It is a point worth considering though because but it does speak to sense of hope that often finds its way into the discourse here. If there are people who have been capable of stemming the effects of energy constraints is there a chance that they can do it for a longer term? Can collapse be avoided, or ameliorated if it does occur ? In this regard the benevolent communism that ArtLeads yearns for, the disappointed nihilism of Fast Eddy, and the microbial revolution of D.S. have something in common. All put the course of history in the hands of human agency.

    Some would argue that we are capable of determining our lot through a reasoned modelling of the consequences arising from our actions. However our choices often are just a muddle through. We just do what seems right at the time. Our actions are usually determined by a narrow range of learned responses in answer to perceptions and models of the world that seldom escape ‘cultural velocity’ (to coin a term). If we are to expect any one in control to keep this sinking ship afloat we can’t expect them to act too much differently than what has come before. Where we go next is determined by past choices more than present ones. Believers in the power of human agency to achieve human goals also forget this; there is really no such thing as a true revolution, only a reconfiguring of relationships or networks.

    Humanity’s existence within the habitat of earth can be seen as a participation in a system that allows no agency and no revolution. We cannot change the constants needed for energy transfer within this system as it relates to maintaining human complexity. Such needs as a comfortable temperature range, regular food and water are baked in. The network of rules, technologies and habits we use to achieve the energy flows we need to achieve these needs we can label ‘the human economy’ (It is misleading to call this network of energy use ‘culture’ when money became our principle tool for control over the harnessing of energy. Take for example the difference between the agricultural revolution – enabled by a cultural shift to adapt to new methods of food production – and the industrial revolution – enabled by a change in money use which allowed the creation of capital intensive projects). Any change within the human economy subsystem must always bow to the demands of the larger system. This is why a set of economic rules only succeeds when it succeeds in feeding its society, or in other words, successfully achieves the required energy flows for maintaining entropy-defying higher order systems. It is this conclusion that reinforces Gail’s premise that it is the interplay of energy and economics that determines the fate of human society. Furthermore, it posits that we are members of a subsystem locked within the demands of a larger system thereby limiting our agency.

    • Thanks for your very fine first comment. You can explain why it is not possible to come up with a new (much improved) economic system to replace the old one better than I can. A lot of this seems intuitive to me. Having someone else put words to explain why the situation is necessary is helpful.

    • ejhr2015 says:

      It very much looks like the “Larger system” is the wiles and money manipulations by the ‘Oiligarchy”
      [regarding which I have just posed a video link here]. It seems the way we are today is very much decided by oil money and influence all over the world, from oil itself through education, health and trade links we all seem to be run by their business models.

      • Stefeun says:

        I understood the ‘larger system’ as being Gaïa (to make it short).
        Btw, much appreciated the description of human economy as being a sub-system (that eventually must bow to the demands of the larger system).

        • ejhr2015 says:

          I just got it mentioned in today’s New York Times as a comment to Paul Krugman’s column about the behaviour of the oligarchs, and the video link posted there.

          {This is supposed to be a reply to Stefeun and myself.]

      • There are concentrations of wealth of many types around the planet. International businesses in particular are involved in these. The only way we can get oil, gas, and coal out is through high tech approaches that require connections around the world, and a lot of debt financing. The result is what may look like “wiles and manipulations by the ‘Oligarchy.'” In fact, however, this is how the system has to work. There has to be a lot of organization to keep everything from falling flat, and this organization takes a lot of energy.

        I do not think that we can conclude that oil money and influence are our big problems. Our big problems run much deeper.

        • ejhr2015 says:

          Did you watch the video? I think you are being too sanguine about how pernicious is the oligarch’s interests. Norman Borlaug was employed by them and we all know the consequences, good and bad, that stemmed from his work. Schooling was deliberately designed to cap intellectual pursuits that might cause free thinking solutions. So now we have sheeple. This is no accident! We only use allopathic medicine in hospitals and med schools. natural remedies were shafted as there was no profit there. The pharmaceutical industry wants people sick and requiring endless medication. Don’t you believe that’s wrong?
          The sooner this civilization gets its comeuppence the better it will be, painful for sure but we cannot endure this malfunctioning civilization without knowing how bad it really is below the pleasantries of the soothing prescriptions of their advertising and distractions. Panem et circences is our time now.

          • Fast Eddy says:

            If you were to have relied for your entire life on herbal remedies and never visited a BAU doctor…. do you think you would have lived as long as those who do?

            Here’s a test – next time you need a root canal — have your neighbour perform this on you without any anesthetic.

            Yes the medical situation in the US is a mess — but don’t throw the baby out with the bathwater…. you may not like the results

            • ejhr2015 says:

              That conclusion of yours is all your own work. If you go to hospital it’ll be entirely allopathic medicine, no ifs or buts.

            • Yorchichan says:

              Fast Eddy, you have way too much faith in the modern medical profession. Of course doctors are good at some things (e.g. setting fractures), but mostly they are nothing but drug pushers for big pharma. Invariably, when doctors go on strike death rates fall.

              Dentists are a bit different, but stay away from sugary processed foods and teeth should last a lifetime.

            • Fast Eddy says:

              In spite of horrible diets… food sprayed with pesticides … much reduced levels of activity…. in most western countries we are living longer than ever…

              I have a fair bit of faith in doctors and medicine. Because the facts say I should.

              I knew someone who had cancer that is normally curable and told his doctor he was going with the ‘wholistic cure’ — whatever that means

              As was to be expected death was soon knocking at the door — in fear and panice he scurried back to the doctor — but he had left it until too late….

            • Yorchichan says:

              @Fast Eddy

              There are many factors contributing to increased life expectancy. Clean water, adequate food supply (admittedly less healthy foodstuffs for many recently), better living conditions and less wearing/dangerous work are all important. Modern medicine mostly gives people a few extra poor quality months at the end of their lives.

            • Fast Eddy says:

              You’ve got it backwards…

              One of the main reasons for longer lifespans is because of medical advances in child birth…. in the past infant mortality rates were extremely high ….

              As someone pointed out — you didn’t name a child for the first year because the odds were high that that child would be dead before it’s first birthday.

          • I’m sorry. I rarely watch videos–takes too much time.

    • Artleads says:


      If Gail has replied as modestly and humbly as she has, I in turn must be lost for words, facing such a masterful post.

      I, too, work on intuition. I did find the following long audio confirmational as to how I’ve experienced intuition.


      I’m in my late 70s, and can think back at what I “knew” from very long ago, to see how it squares with what turned out to be objectively true. I recall writing to my guardian back in my native country that it was what he DIDN’T do to change his buildings that mattered most. This was well over 50 years ago, and without knowing the term, I must have been a conservationist even then. From the 60s on, the tearing down of old places and the hyper construction of the new struck me as woefully destructive culturally and aesthetically. I don’t believe that my intuition was misguiding in that. I didn’t realize that this intuition correlated to declining EROEI. I’ve come to some clear-ish conclusion about this only in the last few months of reading here. Oddly enough, being on FW has pushed me even more extremely toward conservation. I believe this view is absolutely essential to my being. Since it has persisted and strengthened over such a long period, I think it best to trust it come hell or high water. So I believe in a sort of aware non-action.

      Part of that non-action entails trying to get past the traps of ego. The prospect of near term human extinction (NTHE) has clarified everything and simplified my thinking. The predicament of the planet is now so advanced that it is beyond the power of individual human intention to resolve. If it can be resolved (which I intuitively believe that it can) it must resolved itself. Looked at that way, it seems best not to overly distinguish (as to better or worse) what different people propose to do about the predicament. People think and behave as per the master system you describe. I say now, why not just let things flow? I perhaps mind DS’s preoccupation with bacteria. Bacteria swarms act like single organizations, and I believe that, holding out the possibility that we do better, and ultimately begin, acting like bacteria, thinking and acting as one. This is not something to project onto humankind so much as to accept and allow to happen by itself. It is perhaps a product of consciousness. I also it is best to align myself with this convergent coming together of things. Part of how I now see to do do it is to seek consensus. We can’t spend most of our time in disagreement. At some level, I’m nihilistic, and really don’t care what anyone does, what the human world does. I’m here to play the music I’m endowed with, and that is just that. I believe it will change the world just to do that, but whether ortr not it does is not my major concern. It is likely that other people have a similar role to play, but that is not either my main concern.

      Well, this has been long. So, almost at midnight, I say: Follow your bliss AND trust in ALL human voices to combine to save the world. Happy 2016!

      • Contributor says:

        Intuition may lead us understanding to our current situation. However It may not help us in the search for agency in response to collapse.

        Historical evidence would indicate that energy descent in civilisations leads to a disorder that is only rectified by the creation of an entirely new order made of different players, different habitats and different human economies. There is little to suggest that the civilisation that exists now morphs into a new one after descent. There can be no intelligent response to collapse because the knowledge belonging to a civilisation disappears during collapse. Intelligence without knowledge is futile. To put it another way, a collapse is something so severe that there is break in the timeline that would link ongoing intuition with the lessons of the past.

        • Artleads says:

          “Intuition may lead us understanding to our current situation. However It may not help us in the search for agency in response to collapse.”

          I disagree, and think the opposite is true. I more incline to this opinion of Einstein:
          “Imagination (that I equate here with intuition) is more important than knowledge. For knowledge is limited to what we now know and understand, while imagination embraces the entire world, and all there ever will be to know and understand.”

          There are immensely knowledgeable people on earth, and that has not prevented collapse, or led to a broadly shared notion of what to do about it.

          How true is it that “knowledge belonging to a civilisation disappears during collapse.”? Monasteries during the Dark Ages preserved a lot of knowledge. Museums and reliquaries of all sorts preserve a lot of knowledge. The problem now is the unnecessary disregard for these stores of knowledge. That is a culturally influenced mindset.

          “Historical evidence would indicate that energy descent in civilisations leads to a disorder that is only rectified by the creation of an entirely new order made of different players, different habitats and different human economies.”

          But this doesn’t seem to be inevitable. In fact, this blog serves the useful purpose of alerting us to the issue of energy descent. What we do about it is our choice.

          Imagination, intuition, creativity can also inform a transition to different circumstances. It is widely said that the best way to predict the future is to invent it. This invention is what Van Kent and I have been discussing. We can imagine a very initial stage of post collapse, but it’s not necessary for us to imagine beyond that. That should be the job of those to come. And that initial post collapse stage that I envisage is not something one does later; it’s something one begins to do now.

          To a limited extent, it is possible to envision a far-enough future that will be more heavily dependent on trees. The obvious thing to do about that now is to plant the bloody trees. But that is not what we’re doing.

          Educating and empowering women would tend to reduce population, but that education and empowerment is hampered by all sorts of dysfunctional and dissonant global programming that are culturally induced, and not at all necessary.

          So it’s not too hard to envisage what is required in a transitional or successional (word) “civilization.” What is hard is to get past the dissonance and conflict in human relations that prevent its enaction. We haven’t managed to do that here among intelligent, caring people on FW! But what else is more important to do?

        • Once we have to eliminate metals from making new goods–because we no longer have the possibility of making pure metals–pretty much all technology as we know it today goes away. An awfully lot of what we have depended on throughout the ages depends on metals. I remember when I visited Hawaii, its civilization was built without metals. Cooking was in holes in the ground, and food was wrapped in leaves. Skirts were made from dried leaves. We would have to do something similar, starting all over again.