Overly Simple Energy-Economy Models Give Misleading Answers

Does it make a difference if our models of energy and the economy are overly simple? I would argue that it depends on what we plan to use the models for. If all we want to do is determine approximately how many years in the future energy supplies will turn down, then a simple model is perfectly sufficient. But if we want to determine how we might change the current economy to make it hold up better against the forces it is facing, we need a more complex model that explains the economy’s real problems as we reach limits. We need a model that tells the correct shape of the curve, as well as the approximate timing. I suggest reading my recent post regarding complexity and its effects as background for this post.

The common lay interpretation of simple models is that running out of energy supplies can be expected to be our overwhelming problem in the future. A more complete model suggests that our problems as we approach limits are likely to be quite different: growing wealth disparity, inability to maintain complex infrastructure, and growing debt problems. Energy supplies that look easy to extract will not, in fact, be available because prices will not rise high enough. These problems can be expected to change the shape of the curve of future energy consumption to one with a fairly fast decline, such as the Seneca Cliff.

Figure 5. Seneca Cliff by Ugo Bardi

Figure 1. Seneca Cliff by Ugo Bardi. This curve is based on writings in the 1st century C.E. by Lucius Anneaus Seneca, “It would be of some consolation for the feebleness of our selves and our works if all things should perish as slowly as they come into being; but as it is, increases are of sluggish growth, but the way to ruin is rapid.”

It is not intuitive, but complexity-related issues create a situation in which economies need to grow, or they will collapse. See my post, The Physics of Energy and the Economy. The popular idea that we extract 50% of a resource before peak, and 50% after peak will be found not to be true–much of the second 50% will stay in the ground.

Some readers may be interested in a new article that I assisted in writing, relating to the role that price plays in the quantity of oil extracted. The article is called, “An oil production forecast for China considering economic limits.”  This article has been published by the academic journal Energy, and is available as a free download for 50 days.

A Simple Model Works If All We Are Trying to Do Is Make a Rough Estimate of the Date of the Downturn

Are we like the team that Dennis Meadows headed up in the early 1970s, simply trying to make a ballpark estimate of when natural resource limits are going to become a severe problem? (This analysis is the basis of the 1972 book, Limits to Growth.) Or are we like M. King Hubbert, back in 1956, trying to warn citizens about energy problems in the fairly distant future? In the case of Hubbert and Meadows, all that was needed was a fairly simple model, telling roughly when the problem might hit, but not necessarily in what way.

I have criticized Hubbert’s model for being deficient in some major respects: leaving out complexity, leaving out entropy, and assuming a nearly unlimited supply of an alternate fuel. Perhaps these issues were not important, however, if all he was trying to do was warn people of a distant future issue.

Slide 29 from my complexity presentation at the Biophysical Economics Conference. Hubbert's model omitted complexity, entropy.

Figure 2. Slide 29 from my complexity presentation at the 2016 Biophysical Economics Conference. Hubbert’s model omitted complexity, entropy.

The model underlying the 1972 book, Limits to Growth, was also quite simple. Ugo Bardi has used this image by Magne Myrtveit to represent how the 1972 Limits to Growth model worked. It does not include a financial system or debt.

Figure 2. Image by Magne Myrtveit to summarize the main elements of the world model for Limits to Growth.

Figure 3. Image by Magne Myrtveit to summarize the main elements of the world model for Limits to Growth.

As such, this model does not reflect the major elements of complexity, which I summarized as follows in a recent post:

Figure 3. Slide 7 from my recent complexity presentation. Basic Elements of Complexity

Figure 4. Slide 7 from my recent complexity presentation. Basic Elements of Complexity

Thus, the model does not forecast the problems that can be expected to occur with increasingly hierarchical behavior, including the problems that people who are at the bottom of the hierarchy can be expected to have getting enough resources for basic functions of life. These issues are important, because people at the bottom of the hierarchy are very numerous. They need to be fed, clothed, housed, and have transportation to work. All of these things take natural resources, including energy products. If the benefit of available natural resources doesn’t make it all of the way down to the bottom of the hierarchy, death rates spike. This is one of the forces that can be expected to change the shape of the curve.

Slide 17. People at the bottom of a hierarchy are most vulnerable.

Figure 5. Slide 17 from my complexity presentation. People at the bottom of a hierarchy are most vulnerable.

Dennis Meadows does not claim that the model that his group put together will show anything useful about the “shape” of the collapse. In fact, in an article about a year ago, I cut off part of the well-known Limits to Growth forecast to eliminate the part that is likely not particularly helpful–it just shows what their simple model indicates.

Figure 4. Limits to Growth forecast, truncated shortly after production turns down, since modeled amounts are unreliable after that date.

Figure 6. Limits to Growth forecast, truncated shortly after production turns down, since modeled amounts are unreliable after that date.

Anthropologist Joseph Tainter’s View of Collapse

If we read what anthropologist Joseph Tainter says in his book, the Collapse of Complex Societies, we find that he doesn’t consider “running out” to be the cause of collapse. Instead, he sees growing complexity to be what leads an economy to collapse. These are two of the points Tainter makes regarding complexity:

  • Increased complexity carries with it increased energy costs per capita. In other words, increased complexity is itself a user of energy, and thus tends to drain away energy availability from other uses. Thus, in my opinion, complexity will make the system fail more quickly than the Hubbert model would suggest–the complexity part of the system will use part of the energy that the Hubbert model assumes will be available to fund the slow down slope of the economy.
  • Increased investment in complexity tends to reach declining marginal returns. For example, the first expressway added to a highway system adds more value than the 1000th one. Eventually, if countries are trying to create economic growth where little exists, governments may use debt to fund the building of expressways with practically no expected users, simply to add job opportunities.

Ugo Bardi quotes Joseph Tainter as saying,

“In ancient societies that I studied, for example the Roman Empire, the great problem that these economies faced was that they eventually would incur very high costs just to maintain the status quo. They would need to invest very high amounts to solve problems that didn’t yield a net positive return; instead these investments simply allowed the economies to maintain the level that they were at. This increasing cost of maintaining the status quo decreased the net benefit of being a complex society.” 

View of Collapse Based on a Modeling Approach 

In the book Secular Cycles, Peter Turchin and Surgey Nefedov approach the problem of what causes civilizations to collapse using a modeling approach. According to their analysis, the kinds of things that caused civilizations to collapse very much corresponded to the symptoms of increasing complexity:

  • Problems tended to develop when the population in an area outgrew its resource base–either the population rose too high, or the resources become degraded, or both. The leaders would adopt a plan, which we might consider adding “complexity,” to solve the problems. Such a plan might include raising taxes to be able to afford a bigger army, and using that army to invade another territory. Or it might involve a plan to build irrigation, so that the current land becomes more productive. A modern approach might be to increase tourism, so that the wealth obtained from tourists can be traded for needed resources such as food.
  • According to Turchin and Nefedov, one problem that arises with the adoption of the new plan is increased wealth disparity. More leaders are needed for the new complex solutions. At the same time, it becomes more difficult for those at the bottom of the hierarchy (such as new workers) to obtain adequate wages. Part of the problem is the underlying problem of too many people for the resources. Thus, for example, there is little need for new farmers, because there are already as many farmers as the land can accommodate. Another part of the problem is that an increasing share of the output of the economy is taken by people in the upper levels of the hierarchy, leaving little for low-ranking workers.
  • Food and other commodity prices may temporarily spike, but there is a limit to what workers can pay. Workers can only afford more, if they take on more debt.
  • Debt levels tend to rise, both because of the failing ability of workers to pay for their basic needs, and because governments need funding for their major projects.
  • Systems tend to collapse because governments cannot tax the workers sufficiently to meet their expanded needs. Also, low-ranking workers become susceptible to epidemics because they cannot obtain adequate nutrition with low wages and high taxes.

How Do We Fix an Overly Simple Model? 

The image shown in Figure 3 in some sense shows only one “layer” of our problem. There is also a financial layer to the system, which includes both debt levels and price levels. There are also some refinements needed to the system regarding who gets the benefit of energy products: Is it the elite of the system, or is it the non-elite workers? If the economy is not growing very quickly, one major problem is that the workers at the bottom of the hierarchy tend to get squeezed out.

Figure 7. Authors' depiction of changes to workers share of output of economy, as costs keep rising for other portions of the economy keep rising.

Figure 7. Author’s depiction of changes to non-elite workers’ share of the output of economy, as costs for other portions of the economy keep rising. The relative sizes of the various elements may not be correct; the purpose of this chart is to show a general idea, not actual amounts.

Briefly, we have several dynamics at work, pushing the economy toward collapse, rather than the resources simply “running out”:

  1. Debt tends to rise much faster than GDP, especially as increasing quantities of capital goods are added. Added debt tends to reach diminishing returns. As a result, it becomes increasingly difficult to repay debt with interest, creating a major problem for the financial system.
  2. The cost of resource extraction tends to rise because of diminishing returns. Wages, especially of non-elite workers, do not rise nearly as quickly. These workers cannot afford to buy nearly as many homes, cars, motorcycles, and other consumer goods. Without this demand for consumer goods made with natural resources, prices of many commodities are likely to fall below the cost of production. Or prices may rise, and then fall back, causing serious debt default problems for commodity producers.
  3. Because of growing complexity of the system, the “overhead” of the system (including educational costs, medical costs, the wages of managers, the cost of government programs, and the cost of resource extraction) tends to increase, leaving less for wages for the many non-elite workers of the world. With lower wages, the non-elite workers can afford less. This dynamic tends to push the system toward collapse as well.

The following is a list of variables that might be added to the overly simple model.

  • Debt. As capital goods are added to work around resource shortages, debt levels will tend to rise quickly, because workers need to be paid before the benefit of capital goods can be obtained. Debt levels also rise for other reasons, such as government spending without corresponding tax revenue, and funding of purchases deemed to have lasting value, such as college educations and investments in research and development.
  • Interest rates are the major approach that politicians have at their disposal to try to influence debt levels. In general, the lower the interest rate, the cheaper it is to buy cars, homes, and factories on credit. Thus, the amount of debt can be expected to rise as politicians lower interest rates.
  • Wages of non-elite workers. Non-elite workers play a dual role: (a) they are the primary creators of the goods and services of the system, and (b) they are the primary buyers of the goods that are made using commodities, such as food, clothing, homes, and transportation services. Thus, their wages tend to determine whether the economy can grow. In general, we would expect wages of workers to rise, if their wages are being supplemented by more and more fossil fuel energy in the form of bigger and better machinery to help the workers produce more goods and services. If the wages of non-elite workers fall too low, we would expect the economy to slow, and commodity prices to fall. To some extent, rising debt (through manipulation of interest rates, or through government spending in excess of tax revenue) can be used to supplement the wages of non-elite workers to allow the economy to continue to grow, even if wages are stagnating.
  • The affordable price level for commodities in the aggregate depends primarily on the wage level of non-elite workers and debt levels. A particular commodity may increase in price, but in the aggregate, the total “package” of costs represented by commodity prices must remain affordable, considering wage and debt levels of workers. If wage levels of non-elite workers are rising, the overall affordable price level of commodities will tend to rise. But if wage levels of non-elite workers are falling, or if debt levels are falling, affordable price levels are likely to fall.
  • The required price level for commodity production in the aggregate to continue to grow at the previous rate. This required price level will depend on many considerations, including: (a) the rising cost of extraction, considering the impacts of depletion, (b) wage levels, (c) tax requirements, and (d) other needs, including payment of interest and dividends, and required funding for new development. Clearly, if the affordable price level falls below the required price level for very long, we can eventually expect total commodity production to start falling, and the economy to contract.
  • The energy needs of the “overhead” of the system. Increasing complexity tends to make the overhead of the system grow much faster than the system as a whole. Energy products of various kinds are needed to support this growing overhead, leaving less for other purposes, such as to increasingly leverage the labor of human workers. Some examples of growing overhead of the system include energy needed (a) to maintain the electric grid, internet, roads, and pipeline systems; (b) to fight growing pollution problems; (c) to support education, healthcare, and financial systems needed to maintain an increasingly complex society; (d) to meet government promises for pensions and unemployment insurance; and (e) to cover the rising energy cost of extracting energy products, water, and metals.
  • Available energy supply based on momentum and previous price levels. A few examples explain this issue. If a large oil project was started ten years ago, it likely will be completed, whether or not the oil is needed now. Oil exporters will continue to pump oil, as long as the price available in the marketplace is above their cost of production, because their governments need at least some tax revenue to keep their economies from collapsing. Wind turbines and solar panels that have been built will continue to produce electricity at irregular intervals, whether or not the electric grid actually needs this electricity. Renewable energy mandates will continue to add more wind turbines and solar panels to the electric grid, whether or not this electricity is needed.
  • Energy that can actually be added to the system, based on what workers can afford, considering wages and debt levels [demand based energy]. Because matching of supply and demand takes place on a short-term basis (minute by minute for electricity), in theory we need a matrix of quantities of commodities of various types that can be purchased at various price levels for short time-periods, given actual wage and debt levels. For example, if more electricity is dumped on the electric grid than is needed, how much impact will a drop in prices have on the quantity of electricity that consumers are willing to buy? The intersections of supply and demand “curves” will determine both the price and quantity of energy added to the system.

The output of the model would be three different estimates of whether we are reaching collapse:

  1. An analysis of whether repayment of debt with interest is reaching limits.
  2. An analysis of whether affordable commodity prices are falling below the level needed for commodity consumption to grow, likely leading to falling future commodity production.
  3. An analysis of whether net energy per capita is falling. This would reflect a calculation of the following amount over time: Net energy per capita calculationIf net energy per capita is falling, the ability to leverage human labor is falling as well. Thus productivity of human workers is likely to stop growing, or perhaps decline. The total amount of goods and services produced is likely to plateau or fall, leading to stagnating or declining economic growth.

The important thing about the added pieces to this model is that they emphasize the one-way nature of the system. The economy needs to grow, or it collapses. The price of energy products cannot rise much at all, because wages of workers don’t rise correspondingly. This means that any energy substitute must be very cheap. The system needs to keep adding debt, especially when capital goods are added. The benefit of this debt reaches diminishing returns. The combination of these diminishing returns with respect to investments made with debt, and the interest that needs to be paid on debt, means that it is very difficult for energy products based on capital goods to “save” the system.

Complexity Adds Unforeseen Problems

One issue that people working solely in the energy sector may not notice is that our current system for setting market-based electricity prices is not working very well, with the addition of feed-in tariffs and other subsidy programs. There is evidence that subsidizing renewable electricity tends to lead to falling wholesale electricity prices. In a sense, if we subsidize electricity prices for one type of electricity producer, we find it also necessary to subsidize electricity prices for other types of electricity producers. (Also in California.)

Figure 8. Residential Electricity Prices in Europe, together with Germany spot wholesale price, from http://pfbach.dk/firma_pfb/references/pfb_towards_50_pct_wind_in_denmark_2016_03_30.pdf

Figure 8. Residential Electricity Prices in Europe, together with Germany spot wholesale price, from http://pfbach.dk/firma_pfb/references/pfb_towards_50_pct_wind_in_denmark_2016_03_30.pdf

Inadequate prices for electricity producers and a need for ever-rising subsidies for electricity production could, by themselves, cause the system to fail. In a sense, this pricing problem is a complexity-related outcome that economists have overlooked. Their models are also too simple!


It is easy to rely on too-simple models. Perhaps the biggest issue that is missed is that energy prices can’t rise endlessly. Because of this, a large share of natural resources, including oil and other energy products, will be left in the ground. Furthermore, because prices do not rise very high, energy products that are expensive to produce can’t be expected to work, either, no matter how they are disguised. Substitutes that cannot be inexpensively integrated into the electric grid are not likely to work either.

I talked about low-ranking workers being a vulnerable part of the system. It is clear from Joseph Tainter’s comments that another vulnerable part of our current system is the various “connectors” that allow us to have our modern economy. These include the electric grid, roads and bridges, the pipeline systems, the water and sewer systems, the internet, the financial system, and the international trade system. Even government organizations such as the Eurozone might be considered vulnerable connecting systems. The energy cost of maintaining these systems can be expected to continue to rise. Rising costs for these systems are part of what makes it difficult to maintain our current economic system.

The focus on “running out” has led to a focus on finding ways to extend our energy supply with small quantities of high-priced alternatives. This approach doesn’t really get us very far. What we need to keep the economy from collapsing is a growing supply of cheap-to-produce energy and other natural resources. Ideally, these new resources should require little debt, and not cause pollution problems. These requirements are exceedingly difficult to meet in a finite world.


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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1,528 Responses to Overly Simple Energy-Economy Models Give Misleading Answers

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  10. Jarle B says:

    Oslo: 2016 January – June average = NOK 65200 = $ 7376 pr m2 – what gives?

  11. Pingback: An Updated Version of the “Peak Oil” Story | Our Finite World

  12. Sungr says:

    Ali Morteza Samsam Bakhtiari- peak oil theorist from Iran- was a well known commentator on peak oil for several years before his death in 2007.

    “Bakhtiari (1946 – October 2007) was a senior expert employed by the National Iranian Oil Company (NIOC). He held a number of senior positions with this organisation since 1971. He was also an advisor to the Oil Depletion Analysis Centre.

    He held a PhD in chemical engineering from the Swiss Federal Institute of Technology in Zurich, Switzerland. He had been a part-time lecturer for the Technical Faculty at Tehran University for many years. Bakhtiari wrote a number of short essays and is the author of Peaks and Troughs which is about the modern history of Iran.”

    “Dr Bakhtiari suggested that it would require an act of god for the world to avoid warring over depleting energy resources. He also believed that a peak in natural gas would be more shocking than peak oil because natural gas is less fluid and requires pipelines and LNG facilities to export overseas.”


    I found that most interesting part of Dr. Bakhtiari’s work was his theory of peak oil transitions- T1, T2, T3, T4. In Bakhtiari’s scheme, peak oil would begin gently with the T1 transition and proceed to steepen in intensity into the catastrophic T4 transition where oil goes into serious collapse. Now, the timing of these transtions is not rigidly defined. Here are the transitions-

    “The four Transition periods (T1, T2, T3, and T4) will roughly span the 2006-2020 era. Each Transition [will] cover, on average, three to four years.

    The major palpable difference between the four Ts is their respective gradient of oil output decline — very small for T1, perceptible for T2, remarkable in T3, and rather steep for T4. In fact, this gradation in decline is a genuine blessing for those having to cope and adapt.

    It should be borne in mind that these four Ts are only an overall theoretical structure for future global oil output. The structure is thus so orderly because [it is] predicted with ‘Pre-Peak’ methods, ‘Pre-Peak’ assumptions, and [a] ‘Pre-Peak’ set of rules.

    The problem is that we now are in ‘Post-Peak’ mode, and that none of [the] above applies anymore.

    The fact of being in ‘Post-Peak’ will bring about explosive disruptions we know little about, and which are extremely difficult to foresee. And the shock waves from these explosions rippling throughout the financial and industrial infrastructure could have myriad unintended consequences for which we have no precedent and little experience.

    So the only Transition we can see rather clearly (or rather, we hope to be able to comprehend) is T1. It is clear that T1 will witness the tilting of the ‘Oil Demand’ and ‘Oil Supply’ scales — with the former dominant at the onset and the latter commanding toward the close (say, by 2009 or 2010).

    But even during that rather benign T1, the unexpected might become the rule and the orderly ‘Pre-Peak’ rapidly give way to some chaotic ‘Post-Peak.’

    In any instance, the overall structure of the ‘Four Transitions’ is a general guideline for the next 14 years or so — as far as global oil output is concerned. In practice, reality might prove to be worse than these theoretical Transitions; but certainly not better. ”


    Still worth reading his stuff……………………

  13. MG says:

    Currently in Slovakia: the court trial with the father who disconnected his son from artificial ventilation is going on.

    The father who disconnected his son from medical devices: The mega trial was the care for him

    (the article in Slovak)


  14. Christian says:

    Landscape looks good, in summer at least


    Erdogan is now a friend of Putin, but not of Al-Assad… What could he have in mind?


    (RT says nothing about Erdogan’s view of Al-Assad, I got it from Le Monde, in french)

  15. psile says:

    More doom and gloom setting into the Sydney property bubble. It finally seems poised to *pop*. I work with a lot of builders in my job and found this on my LinkedIn newsfeed this morning. Chinese buyers have been one of the major planks underpinning the crazy rise in prices seen during the past few years:

    “The unthinkable has started to happen. The mass of Chinese property buyers who snapped up Australian apartments “off the plan” on the basis of a 10 per cent deposit have started to walk away from their agreements in Sydney.

    Sydney’s largest apartment owner and developer Harry Triguboff has confirmed that this is happening and that by rescinding the contracts the Chinese lose their deposit and the agents must return the commissions.”


  16. Speaking of Energy Sources, Albert Bates resurrected one of his posts on Geothermal.



  17. Yoshua says:


    These numbers are not precise but anyway…

    The U.S drilled 35 000 wells in 2014. Each well cost $10 million to drill, complete and bring on line.
    So it cost $350 billion to drill these wells.

    The U.S produced 10 mbpd in 2014 or about 3,5 billion barrels in a year. The oil price was $100 per barrel.
    The oil produced in 2014 was worth $350 billion.

    So it cost just as much to just drill those wells are those wells produced.

    • Yoshua says:

      The cost for Saudi Arabia on the other hand to drill 400 wells was only about $1 per barrel.

      The cost for Russia to drill 8000 wells was $20 per barrel.

      That is of course if it costs Saudi Arabia and Russia $10 million to drill a well.

    • Sungr says:

      So, Yoshua. What do you want us to conclude from this information?

      Rig count is mainly used as a general reference to the state of the industry. For instance, if you were a geophycial contractor in the Wiliston Basin and you wanted to assess your business outlook for the next year or so- you might say-

      “Holy Moly, the Williston Basin rig count has dropped from 200 working rigs down to 90 working rigs in the last 18 months. We need to cut costs and try to survive the downturn.


      “Holy Moly, the Willston Basin rig count has gone from 175 working rigs up to 200 working rigs in the last 6 months. We need to step up hiring and get another team together to keep up with the expected work.”

      • Yoshua says:

        I just read that the U.S has 1.7 million wells in service for the oil and gas industry. The oil and gas industry is working very hard to produce oil and gas.

        I also read that the giant Ghawar oil field in Saudi Arabia had 3000 wells in operation in 2012 and produced half of Saudi Arabia’s oil production. So Saudi Arabia might have 10.000 wells in operation today 2016.

        The oil depletion rate in the U.S seems to be very high and the cost of production seems to be very high as well. With oil prices now down at $40 per barrel the oil industry in the U.S seems to struggling to survive.

        If this continues…

      • psile says:

        “So, Yoshua. What do you want us to conclude from this information?”

        It means we’re scraping the bottom of the barrel…

        • Sungr says:

          My point was that the rig count is mainly used a general indicator of activity in the oil & gas industry. Oil & gas drillers use the changing rig count numbers to get a feel for current and upcoming business conditions. It may affect business decisions for the driller ie should we put in an order for a new rig this year?

          It’s just hard to draw a lot of sophisticated conclusions based on rig count numbers.

  18. psile says:

    The council which banned sleeping


    “Something strange is happening in Gravesend town centre.

    Fancy a lie-down in Woodlands Park during one of these balmy summer afternoons? Think again – it’s now a crime to lie down. Tired driver thinking of pulling over for a nap in your car? Better just to plough on – it could land you in court.

    Unless you’re “homeless or a vulnerable adult”, you are banned from sleeping in any of the town’s open spaces – as well as in any vehicle, caravan or tent. (snip)

    Kettering Borough Council has slapped a curfew on under-18s, who must now be home by 11pm or risk receiving fines or a criminal record. Bassetlaw District Council has banned under-16s from gathering in groups of three or more if they’re “causing annoyance”, unless a responsible adult is present. The council has defined neither “annoyance” nor “responsible” – so it’s impossible to know whether you’re at risk of offending or not. (snip)

    The London Borough of Hillingdon has gone several steps further by criminalising the gathering of just two people – regardless of age – unless they’re waiting for the bus. This means it is now an offence in Hillingdon to meet up with anyone, whether you’re causing annoyance or not. (snip)”

    Clearly overpopulation has driven the British stark raving bonkers, just like the rat lab experiments of the 70’s which documented deviant anti-social behaviour in overcrowded rat nests. Needless to say for the rats, after the madness, came the die-off.

    • xabier says:

      I would add that one has to experience the truly vile anti-social behaviour of the English non-working class to appreciate what these measures are trying to address. Lots of fake ‘beggars, often demanding money with menaces (my favourite experience was of a thug demanding money, swearing, with a Bible in his hand!)

      But otherwise, yes, over-crowding is driving everyone nuts in Britain!

  19. Latest Collapse Update LIVE with RE & Steve from Virginia



    • Sungr says:

      “Afghanistan may hold 60 million tons of copper, 2.2 billion tons of iron ore, 1.4 million tons of rare earth elements such as lanthanum, cerium and neodymium, and lodes of aluminum, gold, silver, zinc, mercury and lithium. For instance, the Khanneshin carbonatite deposit in Afghanistan’s Helmand province is valued at $89 billion, full as it is with rare earth elements.

      “Afghanistan is a country that is very, very rich in mineral resources,” Jack Medlin, a geologist and program manager of the U.S. Geological Survey’s Afghanistan project, told Live Science. “We’ve identified the potential for at least 24 world-class mineral deposits.” The scientists’ work was detailed in the Aug. 15 issue of the journal Science.”


      • correct me if I’m wrong, but Afghanistan appears to be a warlord state. Helmand being the most lethal province.
        Warlords are not the best folks to do business with long term, in the sense of investing $billions before material is extracted, then naively expecting aforementioned warlords to let you walk off with all the materials necessary to sustain an infidel economy, once those investments begin to pay off.

        In addition to which, all those rare earths and such are useless without the necessary energy sources A) to extract them, and B) to make use of them in any end products

        • Sungr says:

          The war plotters in DC know that if the US military leaves Afghanistan, the Chinese and Russians are ready to consolidate economic and military power in the very heart of the Eurasian continent.

          Let the Great Game Version2 begin….

          • dunno about the chinese, but i doubt if the russkis would want to get their fingers burnt there again

            • Sungr says:

              “China is fast seizing a substantial share of Afghanistan’s natural resources with the China Metallurgical Group Corp., Jiangxi Copper Corporation, and Zijin Mining Group Company winning a joint bid worth $3.5 billion meant to develop what’s touted to be the largest undeveloped copper field in the world.”

              “Moreover, Afghanistan is home to large iron ore deposits stretching across Herat and the Panjsher Valley, and gold reserves in the northern provinces of Badakshan, Takhar and Ghazni. Employment opportunities for the Afghans has received a boost with the Chinese investment projects by virtue of electricity-generation projects for mining and extractions and a freight railroad passing from western China through Tajikistan and Afghanistan to Pakistan.”


            • Sungr says:

              “More than two decades after the Soviet withdrawal from Afghanistan, Moscow is once again seeking to play a major role in the country by boosting military and economic cooperation with Kabul. DW examines. ”

              ” after Russia’s relations with the West soured following the Ukraine conflict, Moscow decided to become active and expand its role in Afghanistan, said Omar Nessar, the director of the Moscow-based Center for Contemporary Afghan Studies (CISA). “Russia has sought closer ties with the Afghan government in a bid to help shape the events on the ground,” he told DW, pointing to Moscow’s military aid and economic investment in the country.”


    • Artleads says:

      I highly recommend listening to this. Listen carefully to Steve, He’s a brilliant and acerbic analyst of the modern scene, but also possessing exquisite judgement about the near future. (Or such is my opinion, anyway.)

      Like me, Steve is a sort of sub-doomer. We believe people will come to their senses before we all get blown away. He mentions three examples of somewhat getting things together (when the chips are clearly down).

      1) No nukes dropped in 70 years.

      2) Relative repair of the ozone hole.

      3) A modest global recognition and conversation (if nothing else) from Paris of the crisis presented by climate change.

      He, like me, believes America is the only significant global player, sink or swim. We sink or swim depending on what America does or doesn’t do.

      Like me, he thinks America could half its energy use without anyone even noticing. But I differ with his wholesale (no doubt simplified) attribution of our crisis to the car. I’m not sure what is meant by getting rid of the cars. He wants to keep BAU going just enough that people can accept less with equanimity. But BAU without cars requires a lot of things:

      – Stopping land development of outlying land that require new roads and cars to get around.

      – Public transportation that take us where we want to go when we want to get there.

      – Getting to out-of-the-way places could require public, free cars that go back and forth from transit hubs.

      – Concentrating population in cities where people can walk to work and to shop.

      – Facilitating food supply, work and recreation where people live, so as to obviate much travel to meet basic needs.

      How society gets the will and the wherewithal to do all these thing (much less much that I’ve omitted) is beyond me. Where do you start? I would consider prohibiting rural development first. Development there is at odds with scenic values that are essential for rural tourism. It also raises taxes, causing rural landowners to sell their land and move away–also antithetical to rural tourism, as well as independence. So there’s a clear, built-in contradiction within rural (real-estate) development.

      But, as Steve suggests, what America needs is a conversation about these things. Maybe blogs like OFW are trying to start that conversation. Notwithstanding the difficulty for BAU of waking people up–causing widespread panic and severe economic dislocation–there is the need to begin this conversation.

      • DJ says:

        Continental europe uses about half US energy per capita. But does not doing that requiring rebuilding US. I am sure someone would notice if US just banned cars.

        • Sungr says:

          How can we rebuild the US? The US has spent the last 70 years consolidating a massive system of far-spread infrastructure that requires an internal combustion vehicle for every participant- personal, business, or government. And we have used most of our energy/resource inheritance in doing so.

          Now we are on the steepening downside of the energy mountain and will soon be scrambling to keep all of that previously built infrastructure working.

          And the downside keeps steepening. No wonder acquiring Russia’s resource base sounds to good to the neocons.

          • our current existence can be summed up in six words:
            explosive force converted into rotary motion

            there is no other way in which modern civilisation can be maintained.

            if there is, and my home grown theory is wrong, I’d be delighted to hear about it

            • Stefeun says:

              I like your homemade summary.

              Probably because I came to a very similar conclusion: for all the processes we’re using, we have to transform any form of energy into heat, before upgrading again, mostly into mechanical energy.
              This mandatory passage through the most degraded form of energy is extremely wasteful, especially if you compare with the tiny expenses Nature makes, and keeping the energy in its chemical form, which allows storage (contrary to heat).

              Now I have to compact the above in a short formula, such as yours.
              (and apologize for tests of html signs)

            • hkeithhenson says:

              “explosive force converted into rotary motion”

              That’s certainly a good definition of what goes on in gasoline engines. It’s perhaps not quite so true in diesel where there is a relatively long burn from injected fuel. In big diesels, the kind that drive ships, it is so slow that we would not normally consider it an explosion.

              Then you get to continuous burn turbo machines which are definitely not explosive but for sure convert fuel energy to rotary motion. And there are steam turbines and water turbines, and electric vehicles run off batteries, overhead wires or third rails. If you go back to railroad steam engines and similar, that’s another example that’s not explosions.

              We could most likely get by without explosive engines, but they are really useful, particularly for vehicle power.

            • i will explain in more detail

              If I throw a lump of coal on a fire—it burns. It is chemical combustion.

              If I take a lump of coal, grind it to a powder, inject into a manufactured container, with the correct mixture of air and inject a spark—it burns with a bang. (Ask any coalminer) If I attach some kind of piston or whater to that container, I can make use of that energy output. Not very efficient, which why we don’t have coal engines, but the principle is sound.
              Instead we throw coal into a steam boiler, the burning explosion is intense enough to create steam—and so on—so we do it that way instead.

              You can do the same thing in a flourmill. If I throw a match into a bag of flour, it will go out, but not if I give the match a flour laden atmosphere–then it explodes.
              Same thing with a pool of diesel–toss in a match, it will go out—vapourise it under pressure–it explodes

              Subdividing our explosive forces into various applications of explosive and non explosive is a nonsense, explosions and burning are simply degrees of the same thing under different circumstances

              Turbines also require explosive forces—you cannot make one without.

              the only water turbine you can get without explosive forces is one made out of trees—and even then you need metal tools

              Chinese fireworks and the apollo moonshots are versions of the same thing–burning/exploding chemicals,
              that is what we have built our current existence on

            • Artleads says:

              @ hkeithhenson

              “Then you get to continuous burn turbo machines which are definitely not explosive but for sure convert fuel energy to rotary motion. ”

              I saw a video where a guy converted his gas engine so it could run on wood combustion–involving convoluted rigging in the back and lots of wood. Relatively pollution-free, I think. He just uses the gas engine to turn on the machine, then shuts it off, while the wood takes over.


              Maybe Don Stewart has given up on us, but he’s done incredible research that suggest more complex ways to look at energy. (Actually, he has a long comment at the end of the Bates article that RE posted above.)

              But I disagree with the seemingly prevailing theory that energy is merely an automatic entity that can only be worked in the way it’s worked now. There is no end to the ways in which energy can be used less wastefully (and stupidly) than it is done under current BAU.

            • those wood combustion rigs were used during WW2 in Europe
              wood is heated, (not burned) this gasifies it. The gas is then used in the engine to provide the explosive force that delivers rotary motion
              there are lots of examples if you want to google it

              As to ways in which energy can be used in alternative ways, I really would like some meaningful examples

              Take a ton of coal, and bottle of gas and a gallon of petrol…take a long look at those three things. Handle them, test them if you know how

              i might well have missed a trick here, but without conversion into another chemical form or compound, i can’t figure out a serious use for any of them.
              Open the can of petrol and it will dissipate of its own accord—as will the gas.
              Coal will sit there a few years, but that too will deteriorate.
              None of them will actually DO anything without our intervention. And that means change into something else.
              If we want to extract “work” from them, the change must necessarily be violent.—You cannot shift a 40 ton truck or 500 ton train with a gentle puff of wind.. That violence must therefore be explosive, and explosion means heat application to deliver rotary motion

              There might be wild and wacky (unproven, untried) theories about energy use out there, but my contention is that our need is here and now—-and urgent.

              we may use energy less wastefully, but entropy cannot be denied

            • hkeithhenson says:

              ” in which energy can be used less wastefully”

              That’s true, or close enough to true. But it doesn’t help with the big problems such as pumping water up hill or making fresh water out of salt that are thermodynamically constrained. Nor does it cope with lifting a large fraction of the human race out of energy poverty or the energy cost of taking CO2 out of the atmosphere (if we decide to do that).

              No doubt, the scope of the problem is daunting. I use the current world primary energy use, around 15 TW as the target to replace with clean solar energy from space. The only reason this makes sense is an energy payback time around 3 months.

              To continue from another post, we need about 3000 5 GW power satellites (that’s measured at the place where a rectenna connects to the grid). A 30,000 ton power satellite takes takes about 2500 launches of a 15 ton payload rocket plane. That included the reaction mass needed to move the power satellite (parts or the completed power satellite) to GEO. At a peak launch rate of around a million flights per year that would take 7.5 to ten years, depending on maintenance overhead, replacement and resupply of station keeping reaction mass.

              “(and stupidly) than it is done under current BAU.”

              There might be less stupid than you would think. Energy efficiency is very important in a lot of places. Energy is, for example, close to half the cost of commercial air traffic.

              BAU has a lot going for it. For example, if you own a home, it makes sense to put in better windows because you will get it back in energy savings. If you rent, the landlord (unless they are paying for the heat) has no reason to put in more efficient windows so low heating cost benefits renters, who are also most often the poorest people.

              Pass laws and force landlords to put in energy saving features? Of course the landlords will have to raise the rent to get back their investment. The rent increase may be less than the renter’s savings, or they may be more, in which case the renters have to give up something, like preventative medical care. It’s a complicate problem, but lowering the cost of energy seems like a way to cut across a lot of these kinds of problems.

              If power satellites are done at all, I doubt lowering energy cost will be the driver. Climate change from CO2 might be. The problem now is that this approach is not on the short list (mostly wind and ground solar) for solving climate problems. But there is a rising awareness that renewable energy of this kind may not be enough to get humans off fossil fuels.

            • Stefeun says:

              “He who burns most energy, wins”

              There are plenty of less wasteful and stupid ways of using different forms of energy, but unfortunately none of them seems able to deliver the huge amounts of instantaneous power that is required to be successful in all situations.
              (hence the big centralized systems Norman talks about, too, instead of a multitude of tiny steps)

              We need to burn, and as much as possible, and at an ever increasing rate, or we die (or perhaps survive, but in a totally different form, certainly less hegemonic).
              Looks like even efficiency is secondary.

            • i didn’t mean to infer big centralised systems—my rotary motion hypothesis is applicable at any level and in any context i think.

              my other energy law, which applies to all nations:
              (which I call the law of collective survival)
              ———if a nation doesn’t produce enough indigenous surplus energy to support the demands of its people, they must beg, buy, borrow or steal it from somewhere else, or face eventual collapse and starvation until their numbers reach a sustainable level.———

              Stick the above rule against Japan for example. You’ll find it fits precisely at every stage. Japan has worked through those 4 options, now their economy is collapsing.
              The USA is being hit by the same law. Producing 10mbd and using 18Mbd means energy deficit–they are working through the above options too.
              Different nations are at different stages, and it may not be apparent, but the end result is inflexible and terminal.

              This links to my rotary motion hypothesis, because we have to keep finding energy sources to feed the machines at an ever faster rate in order to ensure collective survival in the context that meets our expectations. (now and in the infinite future)

              Again—I’d like to be proved wrong. But hopium induced 35000 ton satellites are, I fear, not going to change things in time

            • DJ says:

              If it is rational for a home owner to install new windows it would be rational for the landlord also rent – expenses = profit.

            • hkeithhenson says:

              It depends on who is paying for heating or cooling.

            • DJ says:

              I assumed “heated rent”, you probably “cold rent”. Ok, no disagreement.

            • property rental is now almost the only source of investment left that can provide an income..

              here in the Uk—and I assume many other places with high population densities, landlords are screwing tenants in such a way that rent is getting closer and closer to total income, until we shall reach the point where tenants have no money for anything else.

            • DJ says:

              What if the rents represent true cost? (And true cost approaches the whole salary).

              In Sweden rental is now cheaper than condos and new condos costs about the same as second hand. And the listed building companies only has a profit margin of 1-2%.

              I believe current rents represent about true cost for current standard of living.

            • richard says:

              @DJ – I had begun to write a reply along the lines of Norman’s rant against landlords, but it would take too long, and was too directed toward government policies to post. Blame the tax system and the way we account for inflation.

            • a house represents embodied energy—nothing more

              thus if you buy a house you are buying the energy output of the men and material that put it together.

              if you live in that house as an occupier, you take on the costs of entropy, and its losses, and accrue the increased market value—hopefully the latter is greater than the former.

              If on the other hand you rent it out—you are making a profit on the embodied energy that the house represents.–The house becomes your private oilwell—your source of money-energy

              Given that in the present economic climate almost no other form of embodied energy investment is accruing profit like a house is, then a landlord will screw every penny out of a tenant irrespective of the long term consequences–if it leaves the tenant in poverty, or ultimately homeless—its not his problem.
              Someone will always be available to pay the rent no matter what it is—so it keeps going up, while wages stay static.
              This is what’s happening as we drain the world of energy resources, the same driving forces apply whatever the scale
              As they get closer and closer, the tenant has a choice of a roof or food.
              This is happening right now in UK cities, London in particular.

              Read up on the conditions in Victorian London and elsewhere—history is repeating itself

            • DJ says:

              I’m still not convinced that renters are any more screwed than owners. 🙂

              Two-room condo in small city 8 years taxed salary AND then rent every month, modest house excluding the property 12 years salary. Utterly unaffordable if not because it is assumed it could be sold for more.

            • oh—theyr’e not

              just a different timescale that’s all—ultimately owners will run out of renters in exactly the same way that oil producers will run out of users

              it’s basically the same thing

          • Artleads says:

            I don’t see the need to rebuild America. Most of what is here now can be used in different ways. Bus Rapid Transport (BRT) is being widely applied throughout the country. It merely requires painting a special lane for the buses so they can travel more directly and quickly.

            One problem of public transportation (PT) is that in our spread-out metropolitan regions, PT doesn’t take you most places you want to go, or get you there with the same timeliness as a car. But Park and Ride schemes where you park in one of the endless paved over places, and a series of buses take you where you need to go (usually a downtown hub or a large event) is on the rise. I think this kind of PT can grow, but maybe it ultimately requires free cars that you borrow and return at PT hubs.

            If PT promises to take us where and when we want to travel, we’d find it easier to give up our cars. Maybe the “government” could buy up those cars at a set price, and pay workers to maintain them…then use them toward PT. It’s a chicken and egg situation. The whole process has to be thought through from start to finish.

            • DJ says:

              You have to find out why americans use the double amount of energy of west europeans.

              And then figure out how to cut this in half.

              Without “rebuilding” US.

            • DJ says:

              Let me also add that these european countries are already considered having higher standard of living than US. So any minor inconvenience caused by your changes (one hour extra commute, no home heating) is a big deal.

            • Artleads says:


              I’m a poor scholar. I’ve come across the history pertaining to to America’s squandering of resources (as compared to Europe). Having seemingly endless land to sprawl out into could have something to do with it. But I haven’t retained the long list of reasons I’ve come across. I could reconstitute some of them, but that’s more work than I’m up for just now.

              There’s an intense anti-Europe bias here, strangely combined with the almost fawning obsequiousness vis a vis European culture. Strange. America is built on the land of the Indian. And although no one talks about it, that Indian heritage also makes a difference.

              But you have raised excellent points, and I want to keep them in mind.

      • bandits101 says:

        “Like me, he thinks America could half its energy use without anyone even noticing.” Not a chance in hades…..I mean without anyone noticing. You have not been paying attention. Your assumption again is one of BAU lite, that is everything remains the same but we use less energy, and you have the temerity to suggest it can be halved. Maybe you could forward some big examples of energy use being halved and nothing affected. Maybe we could start at the armed services, education, energy production, food production and distribution, mining, transport……….about the only thing that could halve its energy use would be banking and finance, maybe that’s what you are thinking.

        • Fast Eddy says:

          It has been explained perhaps 1000x why this is not possible …. yet people insist on insisting that it is….

          Simple Definition of delusion

          : a belief that is not true : a false idea

          : a false idea or belief that is caused by mental illness

        • Artleads says:

          I don’t think you understand how NEEDLESSLY destructive, blind and dumb land use planning and development are.

          Some people insist that every bit of stupidity is necessary for civilization to work. I call total balderdash on that. Choices are always being made. Like the choice to close the ozone hole. Why did that not end BAU? If reducing energy use is so bad, why not INCREASE it then? I can think of any number of mind bogglingly dumb things for you to add to the ones already in place.

        • Artleads says:

          “Your assumption again is one of BAU lite, that is everything remains the same but we use less energy…”

          This makes zero bloody sense! NO. Everything would NOT remain the same. Everything would be DIFFERENT. Don’t let me bore you with a list of all the projects that are crying out to be done. Different things from trawling up the few remaining fish in the bottom of the sea. There’s nothing lite about that. Yes. Much less fossil energy and much more muscle and intelligence would be used. If you think that somehow throws the oil economy into a spin, maybe it’s just about time for it to go off into the sunset, damn its hide! But it needn’t go off into the sunset just yet. It simply needs to change, just as does society.

  20. doomphd says:

    Paul Craig Roberts tells the truth about US unemployment and other stats. Your government lies to you: http://www.unz.com/proberts/another-phony-jobs-report/

    • Sungr says:

      These are mostly development wells. We are not talking about bold new geoscience adventures in the desert.

    • Stilgar Wilcox says:

      That’s what the fracking bubble bursting looks like when graphed. Nice one, Yosh.

      • Yoshua says:

        I wonder what the percentage of drilled but not fracked wells is. The drill count has collapsed after the QE ended, but the production has only declined a little in two years. Thousands of drilled wells might just be waiting to be fracked.

        • Stilgar Wilcox says:

          “…but the production has only declined a little in two years.”

          It’s declined 2 million barrels a day! That’s a lot.

    • thats the chart that says it all

      the chart the US politicos choose to ignore, along with the morons who shout the “make America great again” mantra..
      we are running our world economy on legacy oilfields

      • Sungr says:

        The SA rigs are mostly field development drilling in established legacy fields.

        The US rigs are a mixed bunch- frack rigs drilling large areas of sub-permeable target zones, small stripper wells, offshore in Gulf, small operators drilling in niche plays etc etc.

        Apples & oranges.

    • Stilgar Wilcox says:

      The US has a boatload of small oil operations hitting small pockets here and there that when combined adds up.

      • Yoshua says:

        The U.S actually had a higher rig count than the rest of the world combined in 2014. So I guess comparing the U.S to Saudi Arabia gives a somewhat odd picture.

    • Sungr says:

      Yes that is where we were in 2014. What is your point? The interesting action is taking place after this period.

    • Christian says:

      Interesting analysis

    • Crates says:

      Radical delusionism= lacking in rigor , pseudoscience, magical thinking , illusion of control , cognitive dissonance and many other evils.
      Oh, I forgot , the author is of permaculture .
      DJ, thanks for the link . I laughed a lot.

      • Fast Eddy says:

        The author seems to not understand that when petrochemical fertilizers are no longer available… there will be next to no food grown anywhere… because the soil will be dead.

        Epic ignorance on display

        • Christian says:

          And some people seem to not understand the power of military. I bet they never have even visited a military base

        • Crates says:

          Sell ​​books, teaching courses , lectures, solar panels , batteries … selling hope is a very ugly thing . If you understand the reality of the facts , you do not attend classes but are looking for your church, mosque or Pub .
          This is why the “ignorance” of some.

        • Crates says:

          Its methodology is very disturbing. It is based on calculating the energy expenditure of current food production in the US . As it is not excessive there will be not many problems to feed the population. Of course food production needs all the necessary amount of system complexity, but he does not know ( or do not want to know).

          Surely he loves to Joan Baez .

        • louploup2 says:

          Instead of dismissing the analysis out of hand, you might try to counter with a similar level of analytical competence. You sound like the repetitive cursing posters in the comment thread there. Boring.

          • Fast Eddy says:

            I have done that – on Finite World.

            I generally do not post on other sites because they are littered with hordes of Koombayaists, Green Groupies, and Delusistanis who are completely out to lunch.

            And if I were to engage these fools in a discussion that would make me a fool – because they do not deal in facts or logic. They are *&^% idiots.

            The person who wrote that post is a *&^%$#$ idiot. I could explain the reality of this and he would refuse to accept the logic or facts because he is a *&^%$# idiot.

            All that would happen is I’d be met with a deluge of *&^%$# idiots with their fingers blocking their ears hammering away in anger at me for intruding on their world of idiocy.

            FW is home to the perhaps 20 people in the world who actually get it. I can learn from these people. I prefer not to associate with or waste my time in the company of idiots.

        • Tango Oscar says:

          This is why you amend your garden beds and yard now with compost and other organic fertilizers. By the time collapse happens you’ll be able to grow anything you want in those beds. Nuclear radiation watermelons anyone?

          • Fast Eddy says:

            7.3+ billion are not doing what you suggest — and they will be looking to those who have set up organic gardens — to feed them.

            And when you refuse – they will take.

            Organic gardens are going to be the equivalent of a Black Friday Stampede at Walmart … but with guns and no police… in fact the police will be the ones at the front of the stampede demanding to be fed

            Prepping is Futile (that’s the bumper sticker on my truck)

            • bandits101 says:

              FE you appear to have an extremely peculiar understanding of human nature, If you suppose a stampeding horde of people will attack at any given time. Are you assuming somebody (starving or just hungry) that knows you have food, will tell everyone else and organize an assault, or maybe an assault will simply spontaneously manifest itself. Either way, a lot would get very little. Maybe you think they will become zombies.

            • Fast Eddy says:

              What I think is that if my garden has a crop in it when the grocery stores that my neighbours who do not have gardens will be lined up at my door begging for food … women… young children … I would also be concerned that cousins and aunts and uncles and friends would pull up the driveway knowing I grow food — and asking me to share…

              I would also be concerned that the 7000 or so people who live in the town 10k down the road will realize that the farming areas are where the food is… and that they will be headed our way…

              There are also 500k within a tank of gas of here…. they will know that this area is a big food production place — they will not likely realize that there will be very little food here because the farms need petro chemical fertilizers… so they will head this way expecting to be fed… what they will find is a small number of people like me who can’t even grow enough food to support 4 people….

              And they will be asking to be fed —- and when I cannot feed them them will be demanding to be fed… they will be walking into the gardens taking what they want…. if I shoot them they will come back at night and conduct their food raids.

              All it take is one successful foray into the garden by a few dozen people and I starve.

              I can imagine this will be a global problem….

            • Tango Oscar says:

              I’m counting on this. That’s why I live on a secluded hill with only one way in, several long-range guns, and the ability to hit a can of soda from 1/2 mile off the deck of the house. The first few people who stop outside the gate are going to become souvenirs. I was thinking a string of ears hanging on the gate may persuade most to look elsewhere.

            • Fast Eddy says:

              If you are able to fend people off…. then comes the radiation …. there would also be the issue of a crop failure — pests do destroy crops from time to time….drought happens…. there will also be no medicines available so the simplest disease or illness kills you …. stockpiles run out … tools bust and wear out….

              I really so no point in trying to survive the end of BAU … it will not be Little House on the Prairie… it would be a life of suffering….

              The doomsday types have made this out to be an adventure… it will be anything but….

              And the funds could be used on prepping could be used enjoying the final years of BAU….

            • Tango Oscar says:

              I don’t plan on outliving anyone or being the next “Adam” or anything. I merely think it will be interesting to see how it plays out and if things go as predicted. I realize I probably won’t make it more than a year or two, if that. Something real ironic will kill me too that I didn’t see coming, like tetanus, the flu, or choking on my food because I forgot to put enough ketchup in my Doomsday pantry.

            • Fast Eddy says:

              Likewise… I have filled a 20ft container with enough stuff to get a look at what post BAU looks like… when things get really rough I will run the car into a wall of rock….

            • DJ says:


    • DJ says:


      government boasts that in the last three months, some 135,000 Venezuelans have produced 273 tonnes of vegetables, fruits and herbs in urban settings

      Vast swathes of arable land are underused.

      • Tango Oscar says:

        The land can be repaired within a couple of years timeframe as well. I’ve been repairing my rocky, nasty soil here with food-scrap compost and natural amendments like gypsum, hummus, leaves, horse manure, and others.

        • psile says:

          I’m certain that when collapse comes peeps will curb their hunger pangs for the two years it gets them to produce a crop. /sarc

          • Tango Oscar says:

            I’m not suggesting anything of the sort. When collapse happens it’s likely 5 or 6 billion die relatively quickly. But if there are survivors anything outside of a very small population will have to be growing food. If you don’t already have a garden or farm you definitely won’t after collapse unless you seize it, which doesn’t necessarily mean you can produce on it. The time to fix/amend soil is now while BAU is in full gear and amendments can be had for dirt cheap and in super large quantities.

          • DJ says:

            Death rate in venezuela not up yet. They could very well recieve outside help for two years while starting up their own agriculture.

            But I don’t think it will happen that way.

          • Fast Eddy says:


            I imagine they will try to curb their hunger pangs by eating everything that moves… which will of course delay the soil repairs for lack of manure….

  21. richard says:

    Global overshoot day for 2016 is not far off – enjoy it while it lasts 🙂
    “As of 8 August 2016, the world will be living on environmental credit for the rest of the year. This is five days earlier than last year and more than four months earlier than in 1987 when the Global Footprint Network started calculating what has become known as the Earth’s Overshoot Day.”

    • common phenomenon says:

      Oh, good. It’s still a long way off till January 1st is Overshoot Day. In the meantime, for two thirds of the year we are not in overshoot, so our glass is still more than half full and things will be looking rosy for quite some time.

      • Tango Oscar says:

        LOL! We can only hope and pray that’s how it works out. More and more signs of climate collapse are happening each week. It’s sort of strange that the economy, the political environment, and biosphere are all terminally failing simultaneously.

  22. Yoshua says:

    Aristoteles hated money, especially he hated the idea of lending money against interest, but then again, he was Greek.

    Although he admitted that money had a practical purpose: if he went to the market with his cow and started to carve out a piece from the cow for a pair of sandals, then another piece for a vase of olive oil…

    – What you don’t like beef ?
    – You are a vegetarian ?
    – Are you nuts ?
    – How about a pair of sandals ?

    … anyway, it was easies to just sell the whole cow for gold monies and then do his shopping.

    • Artleads says:

      If the society is too big for barter and gift exchange, it’s too big.

      • Froggman says:


      • Christian says:

        Things can be more complex. Inca and Aztech empires counted 15-20 millions subjects each at the time of the conquest. These were stone age societies, and they had many different ways to make goods to move around.

        150 could be fine for Orlov, but it shouldn’t necessarily to be the case. In fact I expect that, in case the number of humans ever fall to only 1%, it can easily boom thereafter ten fold

        • Artleads says:

          Orlov was looking at studies of small-group societies all over the world. Turns out that knowing everyone in your community made people more accountable. But I’ve wondered how some larger groups manage to do well for a long time. A large city that I know a little about is NYC. When I lived there, neighborhoods were very strong. I actually think many blocks had a sort of autonomy, including protection from outsiders wondering in or making trouble. Haven’t really studied Inca or Aztec societies. I know that centralized Mayan civilization collapsed but that its people then spread out across the land, much of that dispersed culture still alive today.

          • xabier says:

            It’s consoling to imagine that salvation lies in small groups where everyone knows one another, but when they go wrong one longs for the anonymity of the city! Every day you’ll be coming across your enemies….

            Here’s an example from my village(been here 16 years, long enough to make enemies and friends, and to get to know some of the workings – it’s not really an agricultural place anymore, by the way. )

            The local farmers all seem to be cousins: the family I am most friendly with also have a high-end car dealership, and for many years gave a new car every New Year to one of the farmer cousins in return for some regular favour (I think it was access to land.)

            All went on nicely until in 2008 the car business went horribly wrong; they told the farmer that regretfully they couldn’t supply a new car that year. The reaction was unreasoning outrage, and when the farmer had a heart-attack soon after, it was blamed on my friends and I believe it came to blows. Anyway, from good relations with kin to an unending feud fuelled by bitter memories: this will never heal.

            This story was brought to mind by an incident in a book about Inuit, when a family found themselves ostracised due to an incident (death of their child) which was not their fault: but the community (mentally-impaired as far as I could tell) decided they were guilty and that was that.

            Another advantage of a small community is that you get to know exactly who the bad apples are, and so never trust them with the smallest thing. In a crisis, that can save your life I should have thought.

            • xabier says:

              Playing word association, with ‘village life’ I would immediately match: ‘malice’!

            • DJ says:

              “Another advantage of a small community is that you get to know exactly who the bad apples are, and so never trust them with the smallest thing.”


            • Artleads says:

              I live in a village too. Smaller than yours maybe. It’s what remains of a very populous company town from decades ago. Squatters lived here and there in the ruins for some time after a period of abandonment. Then new people intent on serious settlement moved in and bought single lots.

              A lot of this complex history pervades the small modern version of the village. Apart from the squatter era, it has always been a grudging part of the system. Cell phone reception is poor, but land lines work fine. We’re connected to the grid. The county has routinely been stingy with services, given how independent the place is.

              My spouse and I tend to be very private. We drive 20 miles to town to shop, as do most residents. We don’t socialize here hardly at all (except when I attend public meetings). Our umbilical cords are tied to the city, to which we are directly connected by a main highway. This sounds like suburbia, I guess, but it’s also a rough and ready town (that some describe as a hybrid of hippie and cowboy) with lots of history. Hardly anyone is rich. There is a sense of community, but you can also be as detached as you please.

              This place is sort of urban and rural at the same time. It’s a hybrid such as I would prescribe for most quasi metropolitan areas. I’m much more keen to see if BAU can be done better than I am to see it go altogether. But I’m not trying to influence anyone. I could care less what people decide to do.

          • DJ says:

            For the 150 thing to work you need isolation I believe.

            You HAVE to accept your 150 even if you don’t like 10 of them and don’t care much about 50-100.

            In a city you just move to 13th floor after made enemies with everyone on 17th.

            In an isolated world it is hard to leave the group. Alone in the wilderness or trying to associate with another group that may just beat the shit out of you, the stranger.

  23. Kurt says:

    I’m sticking with 4 years. Not really a quick and total collapse, but a very clear sign that we are on the other side of growth. Several more nations will be jettisoned and the U.S. Military will become increasingly active. I’m not exactly sure what happens after that.

    • psile says:

      I think you’re confused. We’re already reached this phase…

      • Artleads says:

        Maybe Kurt means that the world will KNOW we’re on the downside of growth, not just some of us on blogs. And he talks about gradual increase in military activity (even though it’s super active already). And MORE nations being jettisoned, even though they are being jettisoned already…

        • Fast Eddy says:

          When real unemployment is in the region of 20% for most countries… worse for under 25’s…. when people are living in the back seat of their cars.. up their ears in debt…. deep down they know something is not ‘right’…. that the future is bleak…. the stress levels must be sky high….

          But the thing is…. they would not understand why things are as they are…. they probably think that the right politician can fix things… they continue to have hope…

          But make no mistake — for hundreds of millions of people their once cushy lives are already no more…. desperation and despair have set in….

          • DJ says:

            I must be living in Utopia. Here everything is wonderful for everyone. Debts are high of course, but there is no reason to die with a positive net worth so it is silly talking about paying off debt.

            • xabier says:

              And if the debts are heritable by your children, grand-children, as in some jurisdictions now? Not quite so good.

            • DJ says:

              No worry in Utopia. If there is debts left when all assets are sold they are cancelled.

            • Froggman says:

              You and I may be living in the same place.

              The unemployment rate in my town right now is 3.6%!! It’s an absurd number. I happen to be in one of those bubble places where everyone is working and spending, traffic is up, residential and commercial development is going on everywhere (3 cranes working in this mid-sized town right now), they keep having to staff-up the planning and building department just to keep up with all the reviews and inspections.

              I see solar panels going up on rooftops and new Nissan Leafs on the street all the time- because people are doing so well they can afford to spend the extra cash on these luxury items.

              Even the small areas of low-income housing are seeing all kinds of infrastructure improvements installed by the local government- street rebuilds with wide sidewalks and shade trees, new parks, fixing old stormwater issues.

              I’d say for most of the community here this is an absolutely golden time, probably better than 10 years ago before the housing bubble burst. If anyone in this town read the things we talk about here it would sound like its from Neptune.

              If Delusistan has a capital, this might be it.

            • Ert says:


              Kind of the same here where I live… and it’s all backed by an export-heavy automotive industry…. and of course an additional very-low-wage income sector in contrast to the ones that directly work in den automotive industry, either as 1st tier or in the 2nd tier as dependent suppliers.

              Crazy, especially if the euro should go bust or the world economy tanks. But I have these notions since 2009…. and all the time the central planners / bankers keep the whole thing going…. infusions… infusions… infusions….

          • hkeithhenson says:

            ” that the future is bleak”

            This isn’t the first time. It happened about once a generation for the last million years or so. Long enough that humans have a wired in coping mechanism that worked just fine in the stone age. Now, not so well.


            It’s so depressing that I no longer work on evolutionary psychology. Do work on ways to improve per capita income over the whole planet.

            I make the case that the IRA went out of business because the Irish women cut their birth rate to about replacement. That seems unlikely to happen in Arab culture, though it did happen in Iran (which is not Arab).

            • Christian says:


              Your work isn’t about it, but it made me think about left-right political spectrum. Since I learned about PO I intuitively knew the left was screwed up, but not really why. Since that time I’ve seen everything turning to the right, especially in South America, even when given.people are losing income they should be asking for more distribution -and more if they know, or “it is said”, that growth and job creation are dead, so that the right meme “each one relays on his own” will hurt more and more people.

              Now I think it is some kind of genetical stuff, a kind of unconscious reflex in behalf of the survival of the species. To put it in a few words: people get that at some point there will not be enough for everybody, so they don’t claim for more redistrubution. It is as to say that the masses are sacrifiying themselves.

              You analize HG societies, but this is more obvious in agrarian, surplus producing ones: if you insist distributing a shrinking pie among all persons, at some point death would democratically hit all of them -and the next crop will still be in the fields, waiting to mature

            • hkeithhenson says:

              “left-right political spectrum.”

              Political memes and religious memes are close, in some places, like the Islamic world and Europe in the past, they are the same. If I am right about a bleak future turning up the “gain” for circulating xenophobic memes, then those kinds of memes will become more influential in times of stress. I don’t want to invoke Godwin, but historically, that’s what happened. It’s so far from unique that is seems to be a standard evolved human species typical response.

              “a kind of unconscious reflex in behalf of the survival of the species”

              This does not follow from logic, sorry to say, there is no selection path to reach “survival of the species.” What goes on is gene selection, genes changing in frequency as time marches forward. I ran a somewhat simplified model and found that genes did ~37% better by going to war in some circumstances, i.e., when facing a 50% starvation event. The same model indicated that when not facing starvation, the bias was ~45% against going to war. Those are high selection numbers. They indicated (if the model is representative of actual stone age conditions) that the traits should be nearly universal.

              ” more obvious in agrarian”

              I don’t want to leave the impression that gene selection stopped with agriculture. Stable agrarian societies had their own selection bias, and if Gregory Clark is right, they were intense, as intense over the 1200-1800 period in the UK as the selection that made wild foxes into tame ones.

              I highly recommend http://faculty.econ.ucdavis.edu/faculty/gclark/papers/Capitalism%20Genes.pdf

              It’s not closely related to the topic here, but it might help understand humans.

            • Christian says:

              I will take a look to that article.

              What you are saying reg. xenophobic memes goes along what I am saying reg. left-right, given the left is universalist and the right allows itself to be ethnocentric.

              The question is Why people that know (with more or less detail) that capitalism is screwed up, and that they are not located in a place to benefit from it, do nothing to improve their standing. I’ve personally talked to right and left politicians about LTG, and all of them agree that “there is nothing we can do about it”. But this is not an explanation of why the masses are doing nothing (nothing else than Podemos or Syriza, which means nothing real). They could try many things, from sharing existing jobs to nationalize banking. But absolutely nothing

              Reg. survival of the species… Of course the kind of work you do, centered in the differences among groups, is not targeting the genes we all share. But they exist, and I am sure they have their own power. If they don’t, why to save the women -and even the kids- of a conquered alien tribe?

            • hkeithhenson says:

              ” given the left is universalist and the right allows itself to be ethnocentric.”

              I never connected modern day politics to this model based on stone age survival but you are probably right, I can’t think of counter examples, at least not among western cultures. Thank you for proposing a link coupling political “science” to biology through evolutionary psychology. If I happen to write on this subject again, I will credit you for this insight.

              ‘talked to right and left politicians about LTG, and all of them agree that “there is nothing we can do about it.”’

              Wrong people. You need to talk to scientists and engineers. It will take investment, which is hard for the political people to do unless it is for the military, but it’s been understood since 1975 that a huge investment in solar energy from space is a game changer for LTG. Look up _Doomsday has been Cancelled_ by J. Peter Vajk. He ran the LTG model (an amazing block of confusing FORTRAN) and tested what oceans of really clean energy from space would do to the model.

              Vijk was inspired by Gerard K. O’Neill. There is a very long Wikipedia article here: https://en.wikipedia.org/wiki/Space_colonization

              O’Neill envisioned industry moved into space and the Earth’s population reduced to a billion or so by out migration to space colonies. There is material in the asteroid belt for a couple of thousand times the area of the Earth.

              “centered in the differences among groups,”

              If you read the article, I make a case for there being very little difference among humans, we have all been subjected to the same evolutionary selection, and the out migration of women has mixed human genes widely. (This mixing is the main reason group selection doesn’t work. If a group selects out a good set of genes, the first thing they do is swap them away with neighbors.) In the stone age, when you needed to fight or starve, the people you fought were typically the same ones you swapped women with for wives in better times. In footnote 5 I quote from Book of Numbers, from The holy Bible, King James version Chapter 3 for an example.

              The will nigh universal trait of incorporating the young women of a defeated tribe as wives or second wives has a huge effect on evolved human behavior to go to war when anticipating a bleak future. What it did was to reduce the genetic consequences of going to war. Even if your tribe lost and all the adults were killed, the warrior’s genes marched on in their female children.

            • Christian says:

              Some anthropologists say that ethnocentrism is the ideology by default, given almost every HG tribe use to refer to itself just as “the people”. But this doesn’t mean that universalism does not exists, just that it is secondary.

              “Wrong people. You need to talk to scientists and engineers”

              My country has barely send to space two or three small and not really usefull satellites.

              “If you read the article, I make a case for there being very little difference among humans, we have all been subjected to the same evolutionary selection”

              I wrote it badly. I just wanted to highlight that you were focusing on the preservation of individual or kin genes as a way to explain war, but that -as war is almost never intended to exterminate- something was missing.

      • Fast Eddy says:

        I sense the full on police state is just around the corner….

        • xabier says:

          It’s here, more or less: just in plain-clothes.

          And let’s not forget repressive thought-control, and mesmerising with glowing screens. Works wonders, and not a shot has to be fired.

          • Artleads says:

            Yeah. It’s pretty damn bad now! Its roots go back a long way…although there was always somewhere else (physically or mentally) to run to, unlike now.

    • Tim Groves says:

      If we were boiling frogs in a cauldron, we’d already be at the stage where we could see continuous streams of little bubbles coming up.

  24. dolph says:

    Many of my posts are not showing up here. There is nothing controversial in them (this whole blog is controversial, per the mainstream). They are not overly long.
    Since the demise of the oil drum, and since zero hedge is useless, there’s nowhere else to have this discussion anymore, really, but there’s no point typing away here only for the posts not to show up.

    • Stilgar Wilcox says:

      I’ve had the same problem, dolph, and that’s why my frequency of posting on here has declined. One strategy you can try is once you’ve finished your post, copy it, then later in the day try pasting it in again. Either there is an active moderator checking some posts before they go on to determine if they are relevant or it’s a glitch in the system.

      • Fast Eddy says:

        Might as well pull the censor filter off… since people will just ad a — or … in between the letters to circumvent….

    • smite says:

      I’m posting quite ‘controversial’ stuff here. I guess it’s something technical on your side. Do you use any sort of filtering/plugins/blockers? Tor browser? Latest update on your browser? Do you refresh the page occasionally?

    • Fast Eddy says:

      It would be useful to have a function where WP indicated the post was held for review — then a notice when/if the post was later published….

      I just posted something that was held … I don’t think there was anything controversial …

  25. dolph says:

    A currency is just an abstract representation of work performed. No currency is perfectly stable, and this is to be expected as nothing in this world is stable.
    The dollar has strength relative to other currencies because the global gold and oil trades are denominated in dollars, and this is true because America is the nation upon which the global system revolves. This in turn is true because America has a long, stable political history, is safe from any challengers, has reserves of any resource you wish to name, and emerged as the dominant empire following WW2 and saw off all competition since then.
    Will this continue for now? Yes. But it will also change in time. Europe, Russia, and China will be the ones changing it, out of necessity. At some time in the future, we will actually have global upheavals and a system reset. America itself will likely tear itself apart as the various racial and immigrant groups all clamor for a piece of the shrinking pie. What else is “Occupy Wall Street” and “Black Lives Matter” and the Trump phenomenon other than…we are Americans, darn it! I’m entitled to get mine, and I want it now!
    In the meantime, though, you will see steady but persistent dollar inflation. The working and middle classes of America will be worked to death to continue the empire. And they will accept taking it in the rear end because of their patriotism, and also the understanding that they don’t really have any other choice.

    • A currency is emphatically not “just an abstract representation of work performed.” It is a form of debt. It is a promise for a share of the future output of the economy. If that output doesn’t exist, then the currency won’t really buy anything.

      • Hm, the “output” part has been lagging severely at least from late 1960s and mid 70s, yet the currency and derivative structures are still supposedly the atlas pillars of the world. And as I posted above many key world CB for some reason still supporting it way above any rational diversification or hedging level explanation..

        Hence it follows, sorry your perspective from “national trade” viewpoint is evidently not correct one, otherwise the system would have snapped into real basked of other currencies long ago, which it did not for some reason. And the reason most likely is the legacy structures are kept humming along as long as possible, incl. the US playing the host role of sole superpower (which is technically not) so the owners of the global financial system can enjoy the rent and hope to continue to do so for some additional time.

  26. Veggie says:

    Electric vehicles will have to compete with this for grid capacity…..

    • DJ says:

      Are you saying zilch is more than nil?

    • Artleads says:

      “Scientists have predicted that unless radical improvements are made in the way we design computers, by 2040, computer chips will need more electricity than what our global energy production can deliver.”

      As with nearly every prediction around here, this is predicated on BAU being the status quo for the next 25 years. Will it be?

      • i’m pitching 2030 for the end, so halfway to that date when folks start to realise we really are screwed

        which is—(drumroll here)


        which is (another drumroll here please)

        a couple of years after the next presidential term ends, and people have worked out that prosperity is not something you can vote into office.Collapse of the US political system will bring down the house of cards, with only the joker left standing

        • Tend to agree here, the global and emerging markets demographics disaster is going to show its wounded knee pattern around 2023-27ish, that could be nice time window for further global crash, one of the first in series of complexity/energy per capita reducing events, not instadoom event obviously yet..

          • Artleads says:

            I agree later on down that the royalty/aristocracy have a unique roll to play in the UK. Back to the future, sort of… They can help to calm things down, for one thing.

        • smite says:

          “a couple of years after the next presidential term ends, and people have worked out that prosperity is not something you can vote into office.”

          How about that “Hope” PR skit the current guy at the office had as a slogan for his presidency? Don’t tell me that bovine excrement already is forgotten?


      • Fast Eddy says:

        Remember this https://en.wikipedia.org/wiki/Who_Killed_the_Electric_Car%3F

        Well … nobody is trying to kill the electric car….. you can drive your petrol car down to various dealerships and trade it in for an electric car any day of the week…

        In fact billions are being offered up in subsidies to EV manufacturers including Tesla….

        Yet very few people are bothering to buy EVs…. because it seems they understand that an electric car is not a reliable means of getting from a>b.

        Remove the massive subsidies on these vehicles and I doubt they would even exist….


  27. Yoshua says:

    The dollar is not backed by gold. I believe that the dollar is backed by something far more sophisticated. I believe that the dollar is backed by science and technology.

    A nation has two options:
    A: Sell gods to obtain dollars to get access to U.S technology.
    B: Create its own science and technology.

    The dollar is the golden cap stone on the top of the pyramid.


    So, maybe the dollar is backed a little bit by oil and cannons too just in case… 🙂

    • smite says:

      Indeed. It is probably intractable to catch up with the U.S. technocracy and technomachinery.

      China imports more semiconductors than crude oil:

    • DJ says:

      I thought money was backed by taxation. Give us X coins or we beat the shit out of you.

      • the value of your money is backed by the energy/industrial output/commerce available to the country in which it is issued

        • Are you sure about that? Perhaps that definition applied around 18th century, but nowadays? Via ZH today, for instance why is the Swiss CB propping up US financials stocks in a massive global downturn? In reality the USD serves dual role as national currency as well as global debt issuance vehicle, these two very antagonistic roles are intertwined in very complex structures of fraud and deceit to extract wealth from the weak and or stupid players. The two respective roles will separate one day again, as they must, similarly as per conclusions of other historical periods. It could be decades away or years, nobody knows. What we do know, “the rich” – more correctly owners of the system like it exactly as it is now, and are not changing anything unless they must, which is not on the immediate horizon.

        • Fast Eddy says:


        • DJ says:

          Yes, value might be sum of energy through sum of money. But the reason this is is because you have to buy and sell stuff in order to pay taxes.

    • Ert says:

      The US imports more than exports… it lives partly on exporting $$$ and importing stuff. If all that $$$ would come back to the us and buy things… the economy could no provide those world class and competitive “physical” (and not movies, software, licenses) industrial products…. except of over-valued real-estate or land.

      In my opinion, the USD is backed by 10 of these:

      • Not anymore, there are perhaps more than a dozen “regional powers” able to sink this carrier group for pennies via various next gen bombs, torpedoes, cruise missiles, swift boats and what have you..

        But why would they do it now, when life is good, money (debt) overflows everywhere..
        They will do it only if needed (uber crazies taking over the US) as the second last punch (nuclear powers) or last punch (non nuclear powers) – exposing the paper weight tiger for what it is..

        • smite says:

          A bit old but anyway. If the Swedes can do it – so can you! 🙂

        • Ert says:

          Agreement with a condition: There is one issue with those “10” I didn’t thought about a long time…

          If you take one of the 10 out… in “your” waters, then you may have a nuclear problem on your hands, since the Nimitz class is nuclear powered. So any “power” might damned if they do… or in alignment with the US if they don’t.

          • Forget about subs, as mentioned above, the utmost leverage is elsewhere, namely new types of missiles with various modes of launch (stationary, boats, concealed in shipping container etc.). That’s why the bully attacks only the underdogs of underdogs, however they would never attack mid-sized country with own defense/and import program like Iran, which demonstrably have these capabilities..

            This is new video about China, but many of these antiship systems are for exports or sourced domestically fully or in some foreign cooperation e.g. with China/Russia/India..

            • smite says:

              Warring the underdog of underdogs are just a convenient way of the MIC to dump the old stocks and perhaps in the process test the battle-worthiness of new prototypes. It also resonates well with the current oil producing states overpopulation issues.

              The actual ‘war’ on a competent adversarial is run algorithmically. A game played to determine who sits on the best hacking tools, algos, electronics, hardware and decision making systems.

              A bit of an old vid:

      • Name says:

        There are many countries with current account deficits, and they don’t have to have aircraftcarriers.

    • Sungr says:

      The dollar is backed by the US Military Establishment and by the financial mobsters on Wall Street.

      It is also valued according to depth of capital markets, rule of law especially in financial dealings, a working insurance industry, well regulated banks, and a tradition of not confiscating financial assets of individuals except under rules of law. A tradition of peaceful leadership transitions within the society doesn’t hurt.

      And don’t forget the internal possession of abundant natural resources from oil & gas to water, minerals, world-class ports, a first world infrastructure that is well maintained, and a world-class education system.

      Not that the US can claim to have all of these all anymore.

  28. theedrich says:

    Build the economy on “faith.”  Today the politically favored economists (e.g., Krugman and Helicopter Ben) are suggesting, in effect, that we no longer need anything at all to underpin our notional “currency” — not labor, not real estate, not skills, and certainly not gold or silver.  The success of the high-tech companies seems to have inspired this mirage, since their primary engine is electrons, the ultimate vaporware.

    This faith-based, “Hilarious” economy will, it is assumed, provide for all of the needs of the inflooding ThirdWorlders, provide every snowflakey college “student” with years to engage in political protests and to enjoy grade inflation, and pay the entire populace to do nothing but power-lounge before the leftist-dominated TV.

    Given this miraculous Disneyland, the non-elites may dispense with work altogether.  Raucous cries about unfairness, racism, microagression, xenophobia or anything else the media can dream up will substitute for “work.”  And the population can grow limitlessly, with no untoward environmental effects, thereby avoiding the Seneca Cliff.  Truly a workless paradise.

    Yup, Uncle Joe Stalin, Mao Tze-Tung, Ho Chi Minh and their countless imitators had it all wrong.  If only they had realized the power of faith, the Commie world would now be whizzing along, far outpacing the evil West.  But our New World Order, run by the female Flying Reptile (J.H. Kunstler’s term), will make infinite complexity and infinite growth the new reality.

    • Tim Groves says:

      Faithium is the element in the periodic table that comes just before Hopium and Charatium.

      • smite says:

        Instadoomium (the element, not the drug) is perhaps first on the unsustainable periodic table of distorted wor(l)ds.

    • dolph says:

      Nice post.

      You simply can’t make this stuff up anymore. I have deep fear, fear that when the fantasy ends, we will see something that makes WW2 seem like kids playing with water guns.

  29. psile says:

    I found this in an article over at Rixstep. I think it’s pretty neat…


    • Vince the Prince says:
    • Fast Eddy says:

      Seven Jibberish Americans Control Most US Media

      From southern France, Christopher Jones summarizes and comments on a report on the assassination of President Kennedy. Need I stress that WAIS censors only direct attacks on other WAISers and grossly improper laguage.

      Christopher says: “I glanced at the Kennedy assassination site and found this; it fits into our discussion of Hollywood stereotypes and the slavish behavior of the US press after the 9/11 tragedy and in the run up to the invasion of Iraq. In a quick rundown, the website recapitulates an old story that I heard back in the late sixties and early seventies in California: that Kennedy was liquidated by the mafia whose kingpin was Meyer Lansky (pal of Lucky Luciano).

      In fact, I could add a small tidbit which the author may or may not have covered: that Marilyn Monroe was murdered by the mafia as a warning to her lovers; Bobby and Jack Kennedy. The story of the Corsican hit squad was documented in a TV documentary in Europe. Of course it would be interesting to know more about Auguste Ricord and his collaboration wih the Gestapo and if he had anything to do with our old friend, Mandel Szkolnikoff.

      “Today, seven Jibberish Americans run the vast majority of US television networks, the printed press, the Hollywood movie industry, the book publishing industry, and the recording industry. Most of these industries are bundled into huge media conglomerates run by the following seven individuals:

      Gerald Levin, CEO and Director of AOL Time Warner

      Michael Eisner, Chairman and CEO of the Walt Disney Company

      Edgar Bronfman, Sr., Chairman of Seagram Company Ltd

      Edgar Bronfman, Jr, President and CEO of Seagram Company Ltd and head of Universal Studios

      Sumner Redstone, Chairman and CEO of Viacom, Inc

      Dennis Dammerman, Vice Chairman of General Electric

      Peter Chernin, President and Co-COO of News Corporation Limited

      Those seven Jibberish men collectively control ABC, NBC, CBS, the Turner Broadcasting System, CNN, MTV, Universal Studios, MCA Records, Geffen Records, DGC Records, GRP Records, Rising Tide Records, Curb/Universal Records, and Interscope Records.

      Most of the larger independent newspapers are owned by Jibberish interests as well. An example is media mogul is Samuel I. “Si” Newhouse, who owns two dozen daily newspapers from Staten Island to Oregon, plus the Sunday supplement Parade; the Conde Nast collection of magazines, including Vogue, The New Yorker, Vanity Fair, Allure, GQ, and Self; the publishing firms of Random House, Knopf, Crown, and Ballantine, among other imprints; and cable franchises with over one million subscribers.”

      I could add that Michael Eisner could depart Disney tomorrow but the company will remain in the hands of Shamrock Holdings, whose principal office is now located in Is-rael”.

      http://wais.stanford.edu/History/history_KennedyAssassination(092803).ht ml

      Bronfman Group Buys Time Warner Music

      NEW YORK (Reuters) – Time Warner Inc. (TWX.N: Quote, Profile, Research) on Monday said it would sell its Warner Music business to a group led by media mogul Edgar Bronfman Jr. for $2.6 billion, in a move to trim the media group’s debts and signaling a return of the former Seagram chairman to the music business.

      The Bronfman group beat out a bid by EMI (EMI.L: Quote, Profile, Research) for the recorded music portion of the business for an estimated $1 billion.

      By choosing the Bronfman bid, Time Warner is forsaking $250 million to $300 million in cost savings it could have realized by combining with EMI, home to such acts as The Beatles and Radiohead. Warner Music artists include Madonna, Led Zeppelin and R.E.M.

      On the other hand, Time Warner is getting more cash up front by selling the entire business, which includes the music publishing company, and will have an easier path to regulatory approval. In the past, European and U.S. regulators have frowned on consolidation within the music business.

      Bronfman’s team, backed by some of America’s biggest private equity houses including Thomas H. Lee Partners, is betting it can slash costs and turn Warner Music around ahead of a comeback in sales, a major challenge in an industry currently in decline.

      Bronfman has had long ties to the music business, first as a songwriter for the likes of Dionne Warwick and Celine Dion, and later as head of Seagram when he bought entertainment group MCA from Japan’s Matsushita for $5.7 billion. On his watch, the renamed Universal Music bought Polygram, creating the world’s largest record company.

      Bronfman merged his family’s entertainment empire with France’s Vivendi three years ago, only to see the family fortune disintegrate. When Vivendi put its entertainment assets on the block earlier this year, Bronfman led a group to buy the assets back but was ultimately outbid by NBC.

      Hit by rampant piracy and competition from other entertainment such as video games, music sales are expected to fall for the fourth year in a row in 2004.

      Earlier this month Sony Music (6758.T: Quote, Profile, Research) agreed to merge with Bertelsmann AG’s (BERT.UL: Quote, Profile, Research) BMG.

      © Reuters 2003. All Rights Reserved.


  30. Crates says:

    I’ve been reading an interview of Art Berman, where it says this:

    “What we are going to have — and I don’t want to create any sort of sensationalistic fears or anything, but I’ve got to tell the truth — the truth is that we are going to see an absolute moon-shot in terms of oil prices sometime sooner than later, I think — let’s just say in the next five years. And I shudder to imagine the devastating impact that will have on the global economy. It’s going to be paralyzing.”

    What is your opinion of your thinking?
    He thinks prices are going to shoot …!!!

  31. psile says:

    Exxon, the only energy company still making money posted its smallest profit since 1999, missing analyst expectations by 35%…Link

    Plus all the oil majors are now struggling to maintain their current dividend. Video Link

    • Historically, I understand that pension funds have held a lot of stock of oil companies. With their dividend payments, there seemed to be two ways to benefit from these stocks. A cut in dividends would be a problem for many owners of the stocks.

  32. Veggie says:

    Suncor (Tar Sand Producer) discusses leaving stranded assets in the ground.
    Perhaps and underlying EROEI issue ????

    • I would describe the issue as a “prices aren’t high enough issue.” I suppose that issue happens somewhat more often to low EROEI products than high EROEI products.

  33. psile says:

    Greenspan Says Oil Prices Have Probably Bottomed Out at $40
    Former Federal Reserve Chairman Alan Greenspan suggested that oil prices have probably bottomed out at about $40 per barrel after tumbling more than 20 percent in the past two months into a bear market.
    “It’s hard for me to imagine it going very much lower, but it could,” he said Wednesday, according to the transcript of a conference call organized by Rock Creek Group, an investment advisory firm in Washington.

    F#ck this old clown, and his investment bank cronies trying to talk the price back up. We’re still in an almighty glut, more production is waiting to come online because any money for countries with their backs up against the wall is better than none. Which means only one thing for the oil price.


    • Every week the amount in oil storage goes up. This graph is two weeks old. I checked, and the amount in storage has gone up the last two weeks as well.

      Oil in storage through July 15, 2015

      • psile says:

        How long before they actually run out of places to store it? Apparently, there’s another 0.7-1.4 mbs p/d scheduled to come on-stream by next year. Will only make things worse.

        • I am not sure. I expect there are different amounts of storage for different products (gasoline, diesel, etc.) as well as for crude oil. I understood that low gasoline storage was the reason why gasoline prices are now so low–even lower than might be expected based on oil prices. I expect that this happens for other products as well. I understand that some gases that might have industrial uses get sold to be burned as natural gas, if there is overproduction of them.

        • Tim Groves says:

          I keep 100 liters of gasoline in my big shed for the chainsaw and the farm equipment. That’s about three year’s supply for me. Now seems like an ideal time to increase the storage capacity, but there are drawbacks. The cost of more 20-liter containers, the concern over fire risk, the extra space requirements, and most of all the problem of degradation/oxidation of the gasoline mixture.

          I’m not much of a mechanic, so I ask other people and check on the internet, and what I hear is that it is a bad idea o use gasoline that’s more than a few months old. Explanations run along the line of: “The most highly volatile components in gasoline also tend to evaporate over time. As they do, the remaining fuel’s volatility and ability to combust properly degrades. The less volatile the fuel, the less effectively it burns in your engine. The result is diminished engine performance. Your engine may still start and run, but it probably won’t run as well.” Given that, I don’t think it is wise for me to be storing five or ten years’ worth of gasoline.

          But this brings us to a bigger problem. Worldwide, more gasoline is being stored for longer and longer periods before being sold to end-users. Won’t refiners and wholesalers eventually have a problem in that they are sitting on huge amounts of “old gasoline” that is no longer fit for purpose? And won’t the end-users of this “old gasoline” increasingly be encountering engine blockage issues? Just a thought.

          • psile says:

            The average shelf life for most gasolines/petrols is only 3 months. So yeah, they just won’t produce the end products in the end, just keep the oil stored ad infinitum? Who’d have though the end of the oil era would end up looking so crazy?

          • smite says:

            The (rapidly degrading) additives are put there just prior to sale. “Raw” refinery grade gasoline probably can last decades. Just keep the cistern closed. 🙂


          • Jarvis says:

            Tim. Here’s a tip for you buy aviation gas as it will last 5 years.

          • Fast Eddy says:

            I believe diesel can be stored for years…. not very useful if you want it for petrol machinery of course

            • Tango Oscar says:

              With a fuel stabilizer/restorer product like Stabil you can keep gasoline and diesel in perfect working condition for years. Ethanol free and supreme blends will also help shelf life a lot. One little bottle of these types of products can preserve several hundred gallons of fuel for a couple of years or longer.

    • Stilgar Wilcox says:

      “…any money for countries with their backs up against the wall is better than none.”

      Pretty desperate predicament. Sell any and all oil (irrespective of the downward pressure it applies to price) and drop QE.

    • Some people like the activities of that clown.
      Namely, DWTI jumped from nothing to crazy $130 few days ago, now corrected a bit to ~$110.. Should the glut continue in autumn/winter, it will jump – multiply again. So Greenspan helped to hold the furious demand destruction stallion in the stables for a while, good job..

    • richard says:

      IIRC : there is a 40% chance of a recession this year” Greenspan, January, 2008.

  34. dolph says:

    A little tidbit:
    I’m a little person, even though I’m a physician. Of course, all physicians are little people unless they make it into the connected class. I still have to rent, and was searching for places in my little suburb of a metro area in the United States.
    I was discussing rent with the useless apartment office staff. He said rents, quoting inexactly, are algorithmically, software determined, and fluctuate daily based on that. No negotiation. He simply looks at a screen, and there the price is.
    In other words…it didn’t matter what I was willing to offer him to lease the apartment. There was no market making from me, no negotiation. Remember, this is something important, it’s housing which is going to take a bite off of my finances.
    I simply pay what the computer tells me to pay, or take a hike.

    Any questions? Do you get the picture now? And if I’m facing this as a middle income physician in America, who knows what others are going through.

    • A Real Black Person says:

      The issue is not affordability, it is that you want to live in a “good” neighborhood populated by other highly paid professionals. In a market economy, landowners can charge the maximum of what most people are able to pay to rent property in a given area…and for a “nice neighborhood” that’s always going to be a lot.* This is truism is why people to this day are still using real estate to make “easy money” . Many people complaining about high rents would love to own property so they could benefit to the same degree the landowners do. The real estate sector, like higher education, is adept at taking advantage of people’s fears, hopes, and ambitions.

      *The a lot amount is partially due to wealthy people being able to bid up prices for property in an area. A wealthy person can pay almost any price for a piece of property because it would be very easy for them to get access to a very large amount credit. There are also government policies around the world designed to keep a lot of borrowed money flowing towards real estate. Borrowed money helps keeps real estate prices inflated. No one will allow real estate prices to fall. Real estate is too big too fail.

      “Any questions?”

      • The problem is keeping debt rising sufficiently to keep real estate prices rising. Especially for single family homes, wages are important as well. If incomes are not doing well, it becomes very hard to keep debt levels up to the point where real estate values are rising.

        • A Real Black Person says:

          Unfortunately, most people in finance and in the larger business community don’t think wages of ordinary workers are important. Trickle down economics or supply side economics have attempted to substitute higher spending by the wealthy and the near-wealthy for wage increases. The way higher spending by the wealthy and the near-wealthy was encouraged was by lower taxes. When politicians say they aim to “put more money in the hands of the consumer”, to them the consumer is a person making at least $ 100,000 a year. There are many people ,in finance and in the larger business community, who believe the economy can thrive by robust consumption of the top 10-20% of income earners.

        • richard says:

          I *think* the latest data on US average wages shows an increase of 4.6%.

          • When I look at BEA’s “wages and salaries” for the second quarter of 2016 and the second quarter of 2015, and divide those amounts by population at the same points in time, I find that average wages per person increased by 2.5%. (This is of course influenced by falling labor participation rate– wages of those who are working are likely rising more than 2.5%. The tax base is only going up by 2.5% per person.)

            • richard says:

              I should have said “average weekly wage” as small changes to hours worked do have effects when looking at rate changes, and that number is more relevant to the economy. The number I quoted (4.6% US May 2016)was on this website:
              “Wages in the United States increased 4.6 percent in May of 2016 over the same month in the previous year. Wage Growth in the United States averaged 6.31 percent from 1960 until 2016, reaching an all time high of 13.77 percent in January of 1979 and a record low of -5.77 percent in March of 2009. Wage Growth in the United States is reported by the U.S. Bureau of Economic Analysis. In the United States, wage growth refers to the yearly change in wages and salaries disbursements from government, manufacturing and service industries.
              . This page provides the latest reported value for – United States Wages and Salaries Growth – plus previous releases, historical high and low, short-term forecast and long-term prediction, economic calendar, survey consensus and news.”
              Hmmm … maybe some sort of parallel universe operating here?

          • A Real Black Person says:

            There are lies…and then there are statistics.

            Averages wages can be distorted by a few executives earning more money.

            The yearly change in the most common wage would be a better indicator of whether wage are increasing.

            • Fast Eddy says:

              When the real unemployment numbers are double digits… I struggle to accept that inflation adjusted wages are increasing….

            • richard says:

              Among other things, besides what the numbers mean, wages, in the US and elsewhere, have increased for a couple of years with no increase in CPI. (Yes, I know that) That divergence can’t go on forever. I’m back to watching things that can’t happen, happening.

      • dolph says:

        You are basically right, but as I said, my main issue is that I have no say in it. There’s no market, in other words.
        For home buyers, there is arguably a market, but any offer at a lower price is immediately rejected because the ball is always with the real estate agent who can go to other buyers with easier access to large amounts of credit.

        It’s a quasi market, the appearance of a market, that is instead inflated by cheap credit. It’s not a free market based on income and supply/demand. If it were, prices would be high, but not this high.

        Ok, question…does housing go to infinity? If it doesn’t, how high does it go? Will a middle class person like myself ultimately be spending all of my post-tax income for a roof over my head?

        Sounds about right. Like I said, collapse is about failing to keep up. You’ll only know when it happens to you. Nobody wants to admit it, it’s too embarassing, so we all pretend until we die.

        I admit it to you doomers because we are in the know. So now you guys know. I’m a physican in America who has to rent because I can’t afford a house at these insane levels. Collapse has happened to me.

        • Tim Groves says:

          Dolph, what you are describing is not an informal market like a bazaar where buyers and sellers can haggle over the price of the goods, but more like a supermarket where the prices are fixed by the seller and the buyer has only too options: accept the price or from buying.

          The property market where you live is operating like a supermarket because the operators of the market find that convenient and are able to impose their will on buyers and sellers alike, just as Walmart is in many cases able to impose its will on producers and consumers.

          The property market where I live is not like that at all. Here, due to the aging society and the associated decline in population, we have a huge surplus of older homes standing empty and their owners are often anxious to sell them in order to avoid responsibility for maintaining and paying taxes on them. This is not a fashionable area and is not expected to undergo gentrification any time soon. But if Leonardo DiCaprio moved in things could change overnight.

        • richard says:

          Rent or buy should be determined by personal circumstances. If inflation hits 5% in 2017, will you be happier?

    • smite says:

      As you and others, including myself have concluded from real-life observations – algos, computers and machines run most this show now. The middle class becoming ever more irrelevant.

  35. Fast Eddy says:

    Attention Homesteaders … Attention Permaculture People….

    The Economic Collapse In Venezuela Is So Bad That People Are Slaughtering And Eating Zoo Animals

    If you were hungry enough, would you kill and eat zoo animals? To most of us such a notion sounds absolutely insane, but this is actually happening in Venezuela right now. This is a country where people are standing in lines for up to 12 hours hoping that there will be food to buy that day, and where rioting and looting have become commonplace. So even though the U.S. economy is in dreadful shape at this moment, we should be thankful for what we have, because at least we are not experiencing a full-blown economic collapse yet like Venezuela currently is.

    Black stallions can be some of the most beautiful horses on the entire planet, but things are so desperate down in Venezuela this summer that everything looks like food to some people at this point. What happened at the Caricuao Zoo on Sunday is so horrible that I actually debated whether or not to share it with you. Desperate people do desperate things, and when people get hungry enough they will do things such as this…


    Keep in mind Venezuela has not collapsed – yet. This is just the beginning … the warm up….

    You better make room in your bed for your chickens, pigs and cows…. oh – and I would not let the family dog out of the house once collapse really gets underway….

    • dolph says:

      Come on, FE. The first thing you thought of when you saw this was to share it with us!

      • Fast Eddy says:

        I do so enjoy tossing a bit of fact and logic over the fence into DelusiSTAN…. it drives the DelusiSTANIS out of their minds….

        I like to watch.

      • hkeithhenson says:

        The bit “that I actually debated whether or not to share it” came from the article. FE, just cut and pasted.

        A number of countries have offered to help in Venezuela and been turned down. What kind of surprises me is that the government has not been replaced by one that will accept help.

    • Sungr says:

      This an article by Michael Snyder of the Economic Collapse Blog. Michael Snyder has a very distinct religious agenda which may affect his credibility for some readers of the Economic Collapse Blog although he has every right to push his stuff. Here is from the blog-

      “My new book entitled “The Rapture Verdict” is the most important thing that I have ever written, but it is also one of the most controversial because I directly challenge what most churches in the western world teach about the second coming of Jesus Christ. In fact, I lay out the most comprehensive case that you will find anywhere for why Christians are going to have to go through the Tribulation and face the Antichrist and the Mark of the Beast. There is going to be a rapture, but it is going to come immediately after the Tribulation is over (Matthew 24, Mark 13, etc.). In this book I lay out evidence that you are not going to find anywhere else, and I deal with the major arguments that those that believe in a pre-Tribulation or mid-Tribulation rapture commonly like to make.”


      “As a little boy I devoured The Late Great Planet Earth by Hal Lindsey, and as I got older I studied the works of virtually all of the most prominent authors in the field of Bible prophecy. If you have an interest in Bible prophecy, you will instantly recognize many of their names: Tim LaHaye, Grant Jeffrey, Chuck Missler, Jack Van Impe, J. R. Church, Dave Hunt, Perry Stone, John Ankerberg, Zola Levitt, Gary Stearman and Peter and Paul LaLonde. I even read every word of all 12 books of the Left Behind series, and to this day I still have them in my library.”

      “Did you know that King David composed a graphic portrayal of the crucifixion of Jesus Christ about 1000 years before it happened? While he was hanging on the cross, Jesus even quoted Psalm 22 to point out to everyone that the fact that his hands and feet had been pierced had been prophesied long ago. At the time this Psalm was written, crucifixion had not even been invented yet.”


      • Fast Eddy says:

        Venezuela’s worsening food shortages had tragic consequences for a rare show horse last weekend, when a group of intruders broke into the zoo, pulled the black stallion from its cage, then slaughtered it for meat.

        Prosecutors say the crime occurred in the small hours of Sunday morning at Caracas’ Caricuao Zoo, when “several people” sneaked into the state-run park under the cover of darkness and busted into the stallion’s pen. The horse, the only one of its kind in the zoo, was then led to a more secluded area and butchered on the spot. Only its head and ribs were left behind in a gruesome pile for zookeepers to find after sunrise.

        Sadly, this horse wasn’t the first zoo animal to suffer the effects of Venezuela’s crippling food shortages. Some Vietnamese pigs and sheep were reportedly stolen from the same zoo earlier this month.


      • Sungr says:

        And the following from the Economic Collapse Blog. I am now unsure whether the collapse blog is maybe to bait for true believers who would then buy his new theology book?

        “Did you know that large numbers of Muslims all over the world are having dreams and visions of Jesus and are turning to Christianity as a result? For an in-depth look at this phenomenon, please see “Dreams And Visions: Is Jesus Awakening the Muslim World?” by Tom Doyle.

        Did you know that Carbon-14 dating gives us strong evidence that the Bible is accurate? Due to the rate that it decays, there should be absolutely no measurable radioactive carbon left in fossils that are “greater than 100,000 years old”. Yet we find it in all of the ancient fossils that we dig up. We even find it in coal, diamonds and in dinosaur bones. Those that seek to promote the theory that life has been around for “millions of years” have absolutely no reasonable explanation for this.

        Did you know that T-Rex bones have been discovered that still contain soft tissue inside of them? If those bones really were “millions of years old” that would be impossible.

        When Charles Darwin came up with the theory of evolution, he didn’t actually have any transitional fossils to prove his theory, but he believed that they must exist…

        Did you know that people are still being raised from the dead in the name of Jesus today?”


        • Crates says:

          Some years ago, a coworker who was a Jehovah’s Witness , said that ” all fossil there in museums the world could fit in a box.” One day, he was peering a screw and said : “It’s the perfect work of God ”
          I thought he was crazy and somehow he scared me . 🙂

        • hkeithhenson says:

          You made this all up? Right?

          • Crates says:

            I am sorry. I have not understood the meaning of his comment . Please try again if you do not mind . I use google – translator. Thank you.

        • Tim Groves says:

          I’m looking forward to chatting with the creationists and Christian fundamentalists when we are all dining on rats with mud pies on our last supper after the fall of BAU. I intend to reassure them that humanity came to this juncture by diligently following God’s command to be fruitful and multiplying.

          • Crates says:

            In Spain, creationists are very few. They can count on the fingers of one hand,” thank God” 🙂
            On the other hand, the people are not armed, and that’s good. But we do not have oil, and that’s bad.

        • Sungr says:

          Gail, I wanted to slightly apologize for taking up good space with such stuff. However, Michael Snyder is quoted EVERYWHERE as a collapse expert. He shows up on Zero Hedge on practically a weekly basis. He gets media interviews quite often.

          And he’s probably seriously nuts. People should be aware of this.

        • xabier says:

          Very amusing about the dreams: by way of contrast, I met a Muslim taxi driver who was deeply impressed that he kept on coming across English converts to Islam – therefore, he claimed with shining eyes, the End had to be Near, as this is one of The Signs.

          Oh dear, who to believe?

    • the saudis have done what we’ve all done more or less

      robbed our kids future.

      they’ve just done it faster and more callously, leaving 30m people to try and survive 20 years from now in a 50c heat desert that can sustain only 1m,

      Saudi is in fact where Delusistan actually is—and we are just using them as a role model—convinced, in true Dickensian fashion, that “something is bound to turn up”

    • Those are really good articles. One thing I didn’t know from the second article:

      “Even during normal years, arid regions in the Central Valley receive about the same rainfall as Riyadh, Saudi Arabia – 4 to 5 inches annually.”

      Trying to produce irrigated crops there, with water from depleting aquifers, is crazy.

      • when the choice is between death and crazy—which do you choose first

      • smite says:

        Why is that crazy, the water would just sit there useless anyway? Just add some fertilizer produced in the natgas chemical plants, and there you go – food for the people. Far cheaper than having to import all the foodstuffs. At least for a little while. 😉

        • Be sure to hand out lots of contraceptives. Otherwise, the country will have a lot more mouths to feed, when they finish using up the water.

          • smite says:

            Don’t you think they already a long time ago passed the point of no return?

            Clean fossil water, a lack of pests, fungi, just add some top-quality near-produced natgas fertilizer probably yields some pretty fine organic wheat, wouldn’t ya think?


      • richard says:

        On Tuesday, July 26, Florida’s Environmental Regulation Commission voted 3-2 in favor of passing controversial new water quality standards that will raise the maximum allowable levels of more than two dozen cancer-causing chemicals to be dumped into the state’s rivers and streams.
        The new standards, which were based on Florida Department of Environmental
        Protection (DEP) recommendations, were passed despite strong opposition from clean water advocates who say that the move poses a serious health threat and paves the way for widespread fracking operations in the state.”
        If the people in Florida weren’t crazy before, raising allowable toxicity levels in their water to allow dangerous financial experiments won’t help.

        • If we ever go toward losing complexity, this is the direction we will go–toward less and less regulation of what gets dumped into our common water supply.

          This approach can kind of work, when there are fewer people and businesses, and pollution isn’t as big an issue. Once there are huge numbers of people and businesses, it doesn’t work well at all.

  36. Irrelevant, or strong can kicking potential given the demographics,
    lots of inertia in natgas, uranium etc., (not mentioning coal) and low energy consumption home appliances (tiny single watt PCs, led light, PV-geothermal leverage for heating etc)?

    One completed TSLA gigafactory = 150GWh of batt capacity yearly output
    Relatively near term goal is operating ~4x such factories (Nevada, Europe, 1-2x Asia)
    They estimate 50:50 split between car pack and storage batt pack production
    => .3TWh storage + .3TWh cars per year

    Longer perspective, they want ~20x such factories globally,
    => 6TWh storage + 6TWh cars per year !

    In summary, this just fits my prognostication, we are going to see social divergence, pretty much a caste system of quasi energy independent upper classes (via PV/natgas gensets/batt storage) in sort of network-gated enclaves, and the impoverished rest of the flyover regions, perhaps even dark continents.

    Accordingly, I’m going to postpone calling “collapse proper” further into the mid century time bracket. Mind you, in the meantime lots of sub crashes can and most likely will materialize..

    • Uhm, hairbrain math, correction issued:

      so apparently at the full ouput (20x factories @ 150/2 GWh, 1.5TWh total capacity y/y of 7000Wh units) and assuming for simplicity that’s all retail small sized Powerwall storage unit (not bigger units for energy companies they also sell), that’s churning each year roughly 215M copies or home batt storage suitable for ~430M people (model housholds of 4 persons – inhabitants)..

      That should help offset some depletion and other finite world chaos temporarily..

      • These batteries don’t produce any food. It is hard to see how they would do much for the water supply, or for maintaining the electric grid. But perhaps they would keep people’s phone charged, so that they could check Facebook.

        • You are correct, but that’s not the point why I’m posting it.

          Let me repeat it again, when there is a caste of people with secured home electricity and fuel for personal consumption for next ~15-20yrs thanks to these gadgets, it changes the perception on many levels, namely about the so distant problems of the poor, the need for expenses on formally shared infrastructure etc..

          • Tango Oscar says:

            Right now it’s mostly accepted that not too much of the overall system can go renewable, especially when you consider the power of such systems to overload the grid during peak hours. This is where solar becomes a huge problem and you can start to see some of that if you look at California’s situation. Worse yet, if and when California is able to offload “free energy” to neighboring states, it is going to make prices in these other areas go lower, driving local suppliers out of business. And this is just a few of the problems with trying to use renewable energy en masse.

            I have a mostly top of the line off-grid solar system that powers two homes that are sizes 2,000 sq. ft. and 1,600 sq. ft. We have 24 almost new static solar panels and 2 sets of trackers with 6 panels each. There are two generators, one powered by diesel and one by propane. The battery system consists of two giant stacks of batteries from: http://aquionenergy.com/

            In addition to the above, the wiring was complex, cumbersome, and annoying. We had to get concrete brought in with a truck and poured in order to set the new panels. And then there’s the inverters, the charge controllers, the power boxes, getting fuel brought in, owning high powered machinery to maintain and move this stuff (excavator, side by sides, a large truck, etc.).

            We currently have around $50,000 invested and we didn’t start with a bare bones system. The batteries alone were 30K of that and we had to rent a forklift in order to get them in place. They are impressively large and sit on what appears to be steel pallets. We live on a hill with a downward slope and the forklift couldn’t get uphill to get to the generator shed while holding one of these batteries. I had to tug it up the hill with my diesel side by side and we had the battery scooting up/down only a few inches from the ground.

            In sum, the costs are too high for anyone without access to large amounts of money upfront. The knowledge and skill gap are too high for most people to do what I did, not to mention maintaining and balancing a more annoying lead/acid battery system. Furthermore there is an element of danger and unpredictability when installing and looking after this stuff. I also have a well tied into the system, a solar hot water heater, and a solar air conditioner. I’m also attempting to grow and eventually hunt all of my own food, which is also something far beyond the skill or understanding of most people, let alone their ability to pay attention to something for that amount of time.

            • Fast Eddy says:

              I contemplated doing what you have done — but decided against it….

              Lots of gear… the smallest thing goes wrong post BAU and that’s all she wrote… my solar powered irrigation system went down after a month use.,.. new mother board …

              I will be happy to stick around a few months post BAU watching things play out… then expiring…

        • DJ says:

          In the future rich people will Like starving poor people on Facebook.

  37. Yoshua says:

    The American war machine went into Iraq and removed Saddam Hussein and the Sunni minority from power. The power and oil fields were given to the Shia majority and western oil companies moved in to operate the oil fields in Iraq.

    After some sanctions imposed on Shia Iran a deal was made and western oil companies are now welcome to operate the oil fields in Iran.

    The American war machine is today working together with the Shia government in Iraq and the Shia government in Iran in the war against the Sunni ISIS.

    The oil fields in Saudi Arabia are located in the eastern province where the Shia minority is living. If a civil war breaks out in Saudi Arabia and the Salafist House of Saud cracks down hard on the Shia Muslims to control the oil fields… then which group would the American war machine choose to stand by ?

    We have all been taught by now that the Salafists, al Qaeda and ISIS are the bad guys and that they are somehow connected to the Medieval House of Saud.

    Will the American war machine stand by the Salafist House of Saud… or protect the human rights of the poor Shia Muslim minority in Saudi Arabia ?

    A partition of Saudi Arabia and the American war machines protection of a new fragile Shiastan in Saudi Arabia would of course allow western oil companies to move in and start operating the oil fields in Saudi Arabia.

    • wratfink says:

      I submit that the people are taught to believe what is convenient for the bosses in their planning…just enough to keep the flags waving and chants going.

      Saddam was not developing the oil fields fast enough and to the satisfaction of the bosses…so he was dealt with. I don’t think the bosses care about which faction is in control as long as they co-operate.

      How much cheap oil is left in Saudi Arabia and whether it is being pumped out at maximum is probably the question that needs answered.

      • Yoshua says:

        Investors Await Moody’s Turkey Verdict to Move Billions in Funds

        “JPMorgan estimated $7.2 billion worth of Turkish sovereign bonds and $1.5 billion in corporate debt are at risk of forced selling in the event that the notes are removed from investment-grade indexes used by many investors as benchmarks for their portfolios.”

        So, here comes the second attack on Turkey after the failed coup. CIA seems to have made up its mind that it will bring down chaos and war on Turkey. Turkey is dominated by Sunni Muslims. The majority of Muslims in the world are Sunni. Perhaps they just consume to much oil ? Perhaps it’s more economic to support a minority ?

        • I suppose lowering ratings by ratings agencies is related to lowering the currency relativity compared to the dollar. The lower these other currencies fall, the less affordable oil is for these other countries, and the lower the price of oil falls.

          • Yoshua says:

            Yes, of course, they can decide who has access to oil and who doesn’t by controlling the value of currencies. Oil is cheap in dollars, but not necessarily in other currencies. Oil producers get hurt, but oil producers that have access to cheap money can still survive.

        • Fast Eddy says:

          For whatever reason Turkey had decided to kiss Putin’s ring…. very difficult to determine why….

          • Tim Groves says:

            With the US and Israel supporting Turkey’s enemies the Kurds while also attempting to use Turkey as bear bait to goad Russia in the same manner they had previously used Georgia and Ukraine, as well as interfering with Turko-Russian trade relations and undermining the Turkish government and society at home in ways Erdogan felt were threatening, perhaps he had a Lando Calrission moment?

  38. psile says:

    Interesting Financial Doom Fact #1: 0.25% is the lowest interest rates have been since the Bank of England was founded in 1694…

    • psile says:

      For England of course.

    • Thanks! It will be even stranger when it goes negative, like it is several other places.

    • richard says:

      Like most “magic” acts, it matters not what the right hand is doing when the left hand is buying Corporate Bonds. Note that if you pay 2x the going rate for a bond, you halve the interest paid, if the instrument has no maturity and inflation is zero. Just sayin’.

      • Tango Oscar says:

        The U.S. Federal Government is being funded via the backdoor with the Federal Reserve’s various bond purchasing programs, bailing out dozens of large banks to the tune of trillions of dollars, and other likely unknown nefarious activities. If this is what we know, imagine what we don’t know.

        It should come as no surprise that the private sector is performing the same sorts of shenanigans by purchasing one another, aka mergers and acquisitions. They’re also engaging in accounting fantasy games by changing the way their earnings are calculated, for example GAAP earnings vs. non GAAP earnings when it suits them more. Intentionally low-balling your Wall Street earnings estimates and then beating them by a little bit in order to drive the stock price up is such a gimmick; and really, how many quarters in a row can companies buy back their own stock shares in order to inflate their earnings?

        Companies like Caterpillar and Komatsu are indicative that growth has been stalling at best, and declining at worst, for at least the last decade or longer. Odds are they can continue playing these games for quite some time yet with no consequences until something more tangible breaks such as an oil supply line breaking or parts suppliers all going bankrupt. Climate change is also a total wild card that most consider to be background noise.

        • richard says:

          Iceberg or Rabbit Hole? pick your metaphor:
          Just to put this in context – when the BoE buys Corporate debt, the interest rate goes down on newly issued debt, so the company makes profits with no effort, and the stock price goes up, and management’s stock options are more valuable.
          Chances are, the Boe’s models suggest that when profits increase, companies start hiring. Not so fast, BoE. Because the interest rate has dropped, the incentive for the management and the shareholders (owners), is to take on more dent, and to buy back shares while rates are low.
          Time will tell which is right.

  39. Kanghi says:

    People along the spectrum start to accept the gloom and realize the nature of the dying beast.

    Note the view about oil:
    “The oil and gas industry’s prayers for a return to high oil prices have yet to be answered, and as a consequence its parlous state deteriorates. A study of 365 oil and gas megaprojects by Ernst and Young shows 64% with cost overruns, and 73% behind schedule. This dismal delivery record is combining with low oil prices to create a potent squeeze on profitability, as the second quarter results of Big Oil showed clearly. US drillers have hit a new record for junk bond defaults: $28.8 bn so far this year, according to Fitch Ratings. With $500 bn+ outstanding, more bankruptcies can be expected. Some companies are trying to buy time by paying debt interest with more debt.

    The industry is trying to innovate its way out of trouble, and as ever makes progress that is impressive, if viewed in a non-holistic frame of reference. Global oil breakeven costs have fallen by fully $19 to a current average of $51 since the oil price started to fall in 2014. The trouble is, the oil price is around $40. Most of the industry’s targets are not just uneconomic, but far from economic.

    “Oil giants find there’s nowhere to hide from doomsday market”, read a Bloomberg headline. “The industry cannot survive on current oil prices,” veteran analyst Fadel Gheit pronounced. The bankruptcy count stands at more than 80 companies so far.”

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