The economy is like a circus. It comes to town, and eventually it leaves town. We get paid in tickets to this circus. As long as the circus stays in town, we can use our tickets. Once the circus leaves town, we are pretty much out of luck.1
The reason the circus stays in town is because the economy stays in sufficient balance that the economy can go on. This is much like the way many other self-organized systems function. For example, our bodies continue to function as long as there are suitable balances in many different areas (oxygen, food, water, air pressure). Ecosystems continue to function as long as there is sufficient rain, adequate temperatures, and enough sunlight.
There are many different views as to what limits we reach in a finite world. Some people think we will “run out” of oil, or of energy products. Some think that the energy return will fall too low, as measured in some manner. I see the adequacy of the energy return as being very much tied to the financial system. Thus, the forecast by US Atlanta Fed GDPNow indicating that first quarter 2017 US GDP growth will only be 0.5% is likely to be a problem, assuming it is correct.
Our economy operates on economies of scale. Once we get too close to shrinking, or actually start shrinking, we reach a point where the economic circus starts to leave town. At some point, we will discover the circus is gone. The economy we thought we had, will have left us. If some people are survivors, they will need to pick up the pieces and start over with an entirely new system.
What the Economy Needs to Do to Keep Functioning
For our economy to continue functioning, a number of variables are important:
- Prices of commodities – Prices cannot be too high for the consumer to afford goods made with them. They also cannot be too low for producers. If prices of oil and other commodities are too low for producers (as they are now), producers need to keep raising debt levels to stay in business. There is a risk that production will stop from lack of adequate new investment, or from the bankruptcy of producers.
- Wages of non-elite workers – These wages need to be high enough so that workers can afford goods made with commodities, such as cars, homes and computers. These big purchases tend to use commodities even after they are made, adding to “demand” for commodities. If commodity prices such as oil are too low (as they are now), it is likely related to the inadequate wages of non-elite workers.
- Mandatory payments required of non-elite workers, such as taxes, health care, and education – It is not just wages of non-elite workers that are important. So are required payments, such as payments for taxes, healthcare and education. Clearly, the lower these payments are for non-elite workers, the better the economy functions.
- Interest rates – Low interest rates are helpful for some parts of the economy, while high interest rates are good for other parts. Low interest rates help create affordable monthly payments for goods such as homes and cars. If interest rates decline, the market prices of assets such as real estate, shares of stock, and bonds tend to rise. These rising values are of great benefit to owners of these assets, since they can sell these assets and use the proceeds to add to current consumption. Conversely, high interest rates are important to pension plans and to others depending on investment income. Banks have a problem if there is not a big enough “spread” between short and long interest rates.
- Increase in debt – An increase in debt indirectly makes the economy “look” much better. Increasing debt acts to raise wages, since some of this growing debt adds to funds available for wages. The higher wages tend to increase demand for goods, and thus indirectly raise commodity prices. A virtuous circle starts, pushing up economic growth, provided an adequate quantity of very cheap energy products is available (under $20 barrel oil, for example) that can be used to make goods and services. Increased debt works less and less well, as the price of energy products increases.
- Inflation rates – The higher the inflation rate, the easier it is to repay debt with interest, since most debt is not adjusted for inflation. Also, high inflation rates help keep prices of homes and other buildings from falling as they age, making the use of mortgages more feasible. If the price of a commodity, such as oil or coal, is high and then falls, debt based on the prior high value of the commodity is likely to become a problem.
- Quantity of energy products affordable by economy – It takes energy products to produce goods and services. If the price of commodities is low, it is possible for buyers to purchase a large quantity of these products, even on a low budget. Current relatively low prices tend to help the economy, even if producers cannot afford to make adequate investment in new production with such low prices. Thus, today’s low energy prices make the economy look good for at a short time. Afterwards, the outlook is less rosy.
Ultimately, the issue at hand in determining whether the “circus will leave town” is whether non-elite workers are able to adequately make a living. We know from biology that the return on the labor of animals must be adequate (animals must be able to get enough food by walking, swimming, or flying) or their populations will collapse. The same thing is true for humans. We also know that prior civilizations that collapsed often had wage disparity problems. When this happened, non-elite workers were no longer able to pay adequate taxes. Their nutrition became poorer. They tended to become more susceptible to epidemics. These were things that pushed the economy toward collapse.
The goods and services that non-elite workers can buy with their wages represent the benefits of our fossil fuel powered energy system, as distributed to the most vulnerable workers in the system. Once these benefits start falling too low, the system can no longer function.
There are some indications that benefits are already too low for the economy to keep functioning in a “normal” manner. A major such indication is the fact that energy prices have remained far too low since mid-2014. It is becoming increasingly clear that there really is no oil price which is both high enough for producers and low enough for consumers. We may be living on “borrowed time,” using an increasing amount of debt to support energy producers.
Thus, world economic growth rates may already be too low to keep the world economy operating. Regulators who consider only the US do not seem to understand the world situation. Because of this, they can easily make moves that make the situation worse, rather than better. For example, they have already started raising interest rates and are planning to sell securities currently held by the Federal Reserve.
A Few Graphs Giving Hints of Our Problem
Economists have not understood what our problems really are, so they have tended to omit some important issues from their analyses. I put together a few graphs that might give a little insight as to what is happening.
Interest Paid by Households
Interest paid by households is important because this money is transferred to banks, insurance companies, and pension plans. It leaves the households who paid this interest poorer. Buying goods using debt is convenient, but it has a cost involved.
BEA Table 7.11 shows a category called, “Interest Paid by Households.” If we compare this to BEA “Wages and Salaries,” we find the relationship shown in Figure 1. Admittedly this is not an exact comparison; there are some people who are not wage earners who are making interest payments, for example. I have not tried to offset “interest paid by households” against “interest received by households,” because the households benefiting from interest payments are likely very different households from those making interest payments. They are likely richer, and at a later stage in their lives.
Figure 1. US Household Interest Paid (from BEA Table 7.11 Interest Paid and Received by Sector and Legal Form of Organization) divided by Wages and Salaries from BEA Table 2.11, “Personal Income and its Disposition.”
The pattern might be described as follows:
- A rapid run-up in interest payments that took place until about 1986
- A general flattening, with new peak in 2007
- A rapid fall starting in 2008
It seems to me that the pattern up to 1986 reflects the general run-up in consumer debt levels during this period. The amount of interest paid is also affected by interest rates, such as ten-year treasury rates.
Figure 2. US Federal Bonds 10 year interest rates. Graph produced by FRED (Federal Reserve Economic Data).
Interest rates started falling in 1981. These higher rates only gradually worked their way into the system because many people had bought houses earlier and were able to keep their existing mortgages at low interest rates. The amount of debt outstanding continued to rise, allowing the total amount of interest paid to continue to rise until 1986.
After 1986, rising debt amounts and falling interest rates came closer to offsetting each other (Figure 1). By 2008, the economy was in a severe recession. In order to help get out of the recession, interest rates were lowered through Quantitative Easing. These lower interest rates, besides helping the economy in general, helped oil prices gradually increase back to the $100+ per barrel price level that they needed to be profitable. Oil prices had temporarily dropped below $40 per barrel in December 2008.
Figure 1 shows that interest payments for several years amounted to about 12% of wages for households. Interest payments are now down to 8% of wages. Even at this level they are significant. They are likely higher than this for those with low wages and high debt. If interest rates rise significantly, the most vulnerable are likely to find their discretionary income reduced.
Rising Healthcare Costs
Figure 3 shows a comparison of US healthcare costs to GDP and to wages. A huge increase in costs is evident in the 2001-2005 periods, and also in the 2008-2010 period, especially compared to wages.
Figure 3. US Healthcare costs as a percentage of GDP and as a percentage of wages. Healthcare costs from cms.gov. Wages and salaries and GDP from BEA.
The increase in healthcare costs since 2008 is one of the costs putting pressure on the economy, and leading to a need for lower interest rates.
The Affordable Care Act should be affecting amounts for the latest years, since the ACA started increasing the number of people with insurance starting about 2014.
Figure 4. Kaiser Family Foundation chart of percentages of non-elderly people without healthcare insurance, from this Source.
A person might wonder why 2014 and 2015 costs didn’t rise more, with so many more people added to the system. Perhaps care that was being given “free” by hospitals is now being charged back to patients. Or perhaps many of the people choosing to purchase coverage through the program were already insured elsewhere in the system, so were not really added to the healthcare system through the Affordable Care Act.
One very recent US healthcare change is the addition of an automatic penalty for not having healthcare insurance. This penalty began for tax year 2016, filed in the beginning of 2017. This provision particularly hurts young people, because rates are structured in such a way that the rates for young people subsidize the rates for older people. Thus, young people often find that buying health insurance is far more expensive than their out of pocket costs for health care would have been, without insurance.
Young people who are affected by this new requirement will find that they need to cut back on other expenditures (such as restaurant visits), if they are meet the requirements of the law–either buy healthcare insurance or pay the mandated penalty. This change will begin to adversely affect the economy in 2016. Bigger impacts are likely in early 2017, when taxes are filed.
Falling Wages Relative to GDP, and Rising Wage Disparity
The path to lower wages as a percentage of GDP has been a bumpy one. The general pattern is that when the economy is booming, wages tend to grow as a percentage of GDP. Recession tends to send wages down as a percentage of GDP. US wages seem to have increased somewhat since 2013, perhaps because the price of oil is down, and the US dollar has risen to a relatively high level. This is part of what allows some people to talk about the “tightening labor market,” and gives them confidence in the economy.
Figure 5. US wages and salaries divided by US GDP, based on BEA data.
There has been significant growth in wage disparity since about 1980, both in the US and in many other developed countries. Figure 6 shows some data for the US.
Figure 6. United States Income Distribution_1947-2007 in 2007$. The data source is “Table F-1. Income Limits for Each Fifth and Top 5 Percent of Families (All Races): 1947 to 2007”, U.S. Census Bureau, Current Population Survey, Annual Social and Economic Supplements. Graph is from Wikimedia Commons http://en.wikipedia.org/wiki/File:United_States_Income_Distribution_1947-2007.svg
As the economy becomes more “complex,” in other words, “specialized,” wage disparity tends to be more of a problem. Work that could previously be done by manual laborers is done by machinery, or is transferred to low wage countries. Many people lose their jobs, and have difficulty finding good-paying replacement jobs. All of this contributes to inadequate wages for non-elite workers.
Role of Inflation and Rising Commodity Prices in the Economy
We rarely stop to think how important inflation is to the economy. For example, if inflation is sufficiently high, it will slightly offset normal depreciation in values of homes and business properties. Thus, home and business property values will tend to slightly rise over time. If banks can count on values of structures rising, rather than falling, over time, lenders can assume that mortgage loans are fairly risk-free, because the lender can count on getting its money back through the sale of the property, if the mortgage-holder defaults.
This same principle holds when energy properties, such as coal mines and oil fields, are financed. As long as energy prices keep rising, there is a good chance loans can be repaid. Once energy prices fall, debt defaults become a problem. Oil exporting countries also find that the taxes they can collect fall significantly. As a result, energy-exporting countries are in a far worse economic position once energy prices fall. Exporters of other commodities, such as metals, have a similar problem if prices fall.
In the last two paragraphs, I mentioned the impact on lenders and governments of rising or falling prices. Owners of properties are also affected by rising or falling prices. If prices rise, these owners can sell their assets, and make a profit. In fact, these owners have often purchased their properties with debt. If the price of the property rises, but the amount of debt is unaffected by inflation, the owner of the property can often get a disproportionate benefit of the price rise. Of course, if the value of a property falls, the property-owner is disproportionately affected by the fall of the price.
We are so used to a rising-price scenario that we have little understanding of how a flat or falling price scenario might work.
To get a little idea of how much inflation has in the past been working through to asset prices in the United States, I looked at some information provided by the US Bureau of Economic Analysis. I compared these amounts to GDP, rather than asset prices, to get an idea of how much impact they have, relative to each current year’s activities (Figure 7). There is about $3 of assets of the types BEA analyzes for every dollar of GDP, so the impact, relative to GDP, is about three times as high it would be, relative to the asset prices themselves.
If this same relationship holds elsewhere, a person can see why a commodity-producing country might have a big problem, if the price of that commodity suddenly falls. There is huge “balance sheet” impact that doesn’t directly affect current GDP as reported (since GDP has to do with current goods and services produced). But it can have a major impact on the country, as it goes forward, because affected loans are much less likely to be repaid. Countries often try to be lenient with lenders, hoping that commodity prices will rise again. But if the drop in prices is permanent, countries must use more and more extreme measures to hide the problem of loans that have a low probability of repayment in a low-priced commodity environment. Eventually, these loans seem likely to default, if prices do not rise sufficiently. China and many commodity-exporting countries seem to be affected by this problem.
Figure 7. Changes to US Fixed Assets, based on BEA Table 5.10, Changes in Net Stocks of Produced Assets.
BEA shows three amounts of interest with respect to US assets (Figure 7):
- Inflation – Changes in asset values based on changes in the general price level
- Re-evaluation total – Changes to asset prices in particular; includes changes because assets are taken out of service because of disaster or because a business is no longer profitable. Note the spikes related to the housing bubble of the 2003-2006 period and the corresponding dip during the Great Recession of 2007-2009.
- Depreciation – Expected amount of new investment needed to offset “consumption of fixed capital.” This rate is quite high, (about 15.7% of GDP recently) because the asset base includes fairly rapidly depreciating assets, such as cars and computers, besides buildings of all types, and intellectual property such as computer programs.
The last year shown is 2015. Inflation (relative to GDP) was only 1.2%, and the re-evaluation total was only 0.3% of GDP. (Calculated as percentages of the assets involved, these inflation rates would be only a third of these amounts.) These low inflation rates make it very difficult to operate a debt-based economy. A shift from inflation to deflation would be a major problem. Unfortunately, it is very difficult to get much inflation, if the wages of non-elite workers remain very low.
Conclusion
We have kept our economy expanding through growing debt use and growing energy use. I described this process in my post, What has gone wrong with oil prices, debt, and GDP growth?
Now we seem to be reaching the end of the line. The economy is getting very close to shrinking. When this happens, we are getting close to economic collapse–the economic circus is starting to “leave town.”
People who think our only problem is “running out” and “high oil prices” don’t see the problems the economy is developing right now. These problems are much more subtle, but they can have a devastating effect. The Federal Reserve talks about inflation rates above 2% being too high, but inflation rates below 2% are at least equally problematic. Somehow, the debt system needs to keep operating for the whole system to work.
We are now at the point where the economy is decidedly unstable. Little things can affect it, like the Affordable Care Act requirement that uninsured people buy healthcare insurance, or pay a penalty. Low commodity prices make debt repayment more difficult in countries producing those commodities.
We should not be too surprised if the economic circus starts to leave town. There are simply too many pieces that are now unstable. The US Government is facing a shutdown in the near future, unless its debt ceiling can be raised and funding can be enacted. The world is depending on China for economic growth, but China’s debt is becoming unmanageably high. Japan’s debt is also unreasonably high. Oil exporters are becoming increasingly unstable, with continued low prices. We can find problems in almost every country of the world. It looks like it is only a matter of time, until one of these problems starts a downward spiral.
Note:
[1] Thanks to commenter “Lastcall” for this analogy.
https://s.w-x.co/wu/GettyImages-671621052-632px.jpg
Not a very exacting science poster. I thought sine is zero at the origin. Then, reached a maximum value of 1 at 0.5Radians (90 degrees) (and cosine has a value of 1 at the origin and 0 at 0.5Radians). That one looks negative at the origin and is definitely not symmetrical. So, unless I am way off, it appears to be neither graph of sine or cosine.
I mean if your nerdy enough to be there your nerdy enough to get it right.
http://interactivepython.org/courselib/static/thinkcspy/_images/sinpic.png
Maybe some sort of inside joke. More science needed.
We have made it! As of today, we are 7.5B humans on the Pale Blue Dot! Let’s give ourselves a giant pat on the back! (sarc!)
http://www.worldometers.info/world-population/
Will we get to 8B humans? Stay tuned on this (rapidly degrading) Finite World!
Al Bartlett would LOVE IT!
We are not at the end of April yet and already 26,000,000 nett human rats have joined the feeding frenzy!
We are fast approaching the point of 100,000,000 new human rats per year joining us. That’s like adding a new Philippines of rats each year — awesome!
I think I will celebrate with another cup of capsule generated coffee.
Can we make it to 8 billion human rats?
Aren’t they so cute – cootchie coo…
https://s-media-cache-ak0.pinimg.com/originals/c5/cb/0a/c5cb0ac730e1f275d76153c33e21bfa4.jpg
Lollll!! We outnumber even them….Guess who the winner is when it comes to the most populous mammal in the world…we are more than the next nine mammal populations COMBINED…and BTW all nine are in large numbers because we use them for food, work or companionship…
http://www.worldatlas.com/articles/most-populous-mammals-on-earth.html
Overheard … one rat complaining to another….
‘Did you see Ralph’s Missus Rat is up the duff again?’
‘Yep — that’s 8 x in 8 years – they breed like humans those two’
‘And why can’t you go anywhere without bumping into one of those damn humans, they’re everywhere these days!’
One of my favourite quotes ever is from Al Bartlett:
“The greatest shortcoming of the human race is our inability to understand the exponential function.”
Bunch of Debbie Downers–
We need a March for Extractive Industrial Capitalism.
Greed is good!
Ok, enough with the satire—
And no good circus would be complete without a freak show…
http://cdn.thepoliticalinsider.com/content/uploads/2015/09/Trump1.jpg
https://i.ytimg.com/vi/GXpzKJXPjys/hqdefault.jpg
http://i.dailymail.co.uk/i/pix/2017/01/19/01/3C422C6900000578-0-image-a-1_1484789317914.jpg
Hey look our problems are solved. Is there any real limitations? Not to insanity.
https://www.bloomberg.com/news/articles/2017-04-23/space-the-final-frontier-seen-for-earth-s-crude-oil-giants
It is a shame the very few sane people on the planet have to devote so much time and effort explaining to the rest what should be intuitively and blindingly obvious. I fear our species has collectively reached a point of psychotic megalomania.
Peak Oil, Peak Debt, Peak Water, Peak Soil all big. Peak Sanity bigger.
As long is cost/energy use is no problem, we can get minerals from space. Also filter sea water. Those who believe in the endless rise in prices seem to think these things are possible.
Suppose the moon was solid crude oil. I still don’t think it would be more economical to extract than even shale oil is here on Earth. How would you get it from the Moon to the Earth? Reentry into Earth’s atmosphere with millions of tons of flammable crude sounds like an accident waiting to happen. I suppose you could beam the oil here but that technology doesn’t exists. I will go out on a limb and say: humans will never be able to economically mine energy sources from other planetary bodies or their moons.
hater
the fundamental point missed by asteroid/moon miners is, that whatever elemental resource is brought back to earth, it is of no use whatsoever unless it is heat-processed
Or in the case of hydrocarbon materials, burned as a primary fuel source.
which brings us back to the stark reality that it was burning stuff that got us into this mess in the first place.
If by some remote chance there was a solid gold asteroid out there, say 50m tons of the stuff, then it would still be of no use.
World gold stocks are about 130k tons. Find 50m tons and you destroy the global economy.
ah but Norman, the Chinese have proposed mining the Moon’s regolith for it’s content of 3He, which can be used as a nuclear fuel in fusion reactors. the only problem is no one has figured how to get the fusion reactors going at a profit.
The energy required for 1kg of crude oil to escape the gravity of the moon is greater than the energy obtained from burning 1kg of crude oil so it would be a non starter.
Yorchichan – yes the energy cost of extraction just lifting it off the moon is likely to be uneconomic. It is just so delusional. Without some form of technological breakthrough that allows it to be beamed here (Star Trek style). It just is not going to happen …. EVER!
Even if we could beam the energy here for free what would that solve? We would still be burning more and more every year. And resources that are becoming scarce now would become more so thus needing more energy to extract them. 100millions barrels per day would become 200million barrels per day in 10 years time. Then 400million barrels per day in 20 years time. We would soon need to double our oil supply again and the Moon wouldn’t be enough. It is ludicrous. We would literally torch this planet with all the heat engines we would have running day and night.
Greg
I may have been a bit hasty and am not 100% sure what I wrote is correct. After all, it’s a chemical reaction that allows a rocket to perform the far harder task of escaping Earth’s gravity.
Not heard from Keith for a while. I’m sure he’d know whether it takes more energy for 1kg to escape the gravity of the moon than is obtained by burning 1kg of oil.
Either way, as you say, obtaining resources from space could never happen.
Nobody stepped in, so I’ll have a go myself:
Escape velocity of moon = 2.38km/s = 2380m/s
Energy required to accelerate 1kg to this velocity = 0.5*1*v^2 = 0.5*2380^2J = 2.8*10^6J
Energy from burning 1kg oil = 12kWh
1kWh = 3.6*10^6J so energy from burning 1kg oil = 12*3.6*10^6J = 4.3*10^7J
So 1kg oil contains about 15 times the energy required to lift it from the surface of the moon (and I was wrong).
And you drive taxi?
People from all walks of life end up driving taxis for a variety of reasons. It’s more fun and less stressful than any office job. Plus the equation E=0.5mv^2 is learned in secondary school. I hope almost anyone posting here could have done the quick calculation I just made if they had thought about it.
I could have joined in the Uber conversation, but I didn’t want to get myself into trouble 😉
I almost thought “what a waste”, but I can’t really suggest something worthwhile to do. At the minimum it is a requested service and not a BS job.
Driving a taxi on a Saturday night is good collapse training.
At least space hopium mining seems successful.
I had a quick scan of that article…. and what comes to mind is…
“We’re no longer fact-based. The founding fathers created a country based on fact. We don’t have a fact base. If Breitbart News and the New York Times are regarded with equal credibility, you worry about this democracy.”
http://www.zerohedge.com/news/2017-04-24/schumer-us-no-longer-fact-based-nation-breitbart-news-threat-democracy
Completely agree – to suggest that the NYT is perceived as fact based is an outrageous claim — and it definitely makes me worry about democracy.
The double-speak on display here is epic…. and as Orwell predicted … few are questioning it.
It is pretty clear that collectively as a species we have lost it…
I concur! Collectively humans are just plain dumber than yeast!
Space mining…peak stupidity.
Stupidity is one thing that never peaks 🙂
Entertaining Collapse-related news from the surreal London property market: the mayor is allowing the development of ‘Naked Houses’, which can be sold at some 40% less than the usual (insane) market rate by virtue of being -wait for it – ‘stripped of all that stuff people don’t want in the first place.’ Hence, ‘naked’.
Like proper kitchens, plastered walls, flooring, room partitions, etc! I suspect that cells in most Scandinavian prisons are more agreeable and comfortable than these truly spartan units. And they are, of course, still not cheap by any means: the definition of ‘affordable’ is wonderfully flexible here, like ‘sustainable’ and ‘clean’ energy.
I can compare this to the house where I live, which was a standard model built in village all over Britain after WW2 to house workers: brick walls, external and internal, higher ceilings than the current average, and with a large garden – workers were expected to want to grow their own food and keep rabbits or hens after the suffering and malnutrition of the 1930’s.
The lowest grade of house at the time, therefore, and it’s like a medieval fortress compared to this rubbish offered by the Socialist mayor of London, and even better-built than the ‘luxury’ developments springing up all around here.
Well there you are: it’s not Collapse, you just didn’t want all that stuff, did you?! Now, go along and offer incense at the Emperor’s altar and all will be well. You’re a Roman citizen after all, Rome can never fall!
After ‘Naked Homes’ the obvious next step is clearly Mars!
Just a hop and a skip away, after all, for this magnificent civilisation that can solve any problem it cares to…….
Xabier, only tangentially related to your points, as the London housing market is a world unto itself, but the UK consumer seems to be in a bit of a pickle now:
“An ugly March meant retailers suffered their worst quarter in seven years, with sales down 1.4% in the first three months of 2017. The extent of the sales decline in the first quarter is the clearest indication yet from the official data as to how rising prices are hitting consumer spending and hurting economic growth.
“Retail sales fell 1.8% in March, according to the Office for National Statistics, the fourth fall in the past five months. The retail data follow news that consumer prices rose 2.3% in March, the joint-highest rate of increase since September 2013…
“The consumer is clearly coming under increasing pressure to rein in spending amid rising prices and weak pay growth, a trend which looks to have continued into the second quarter. The latest survey data showed the amount of cash that households had available to spend fell in April to the greatest extent for two-and-a-half years, blamed on rising living costs as inflation accelerates, as well as stubbornly subdued pay growth.
“The survey showed spending was supported by households eating further into their savings and taking on more debt. The household savings ratio has fallen to a record low of 3.3% in the fourth quarter of 2016. Such spending is clearly unsustainable in the long run, and it’s looking likely that the economy has lost one of its main pillars of growth as households pull back on their spending.”
https://seekingalpha.com/article/4064337-u-k-retailers-suffer-worst-quarterly-sales-fall-7-years
The screws are certainly tightening all the time in the UK, in line with Gail’s thesis of declining purchasing power among non-elites.
Coming soon?
https://i0.wp.com/www.fivestarsandamoon.com/wp-content/uploads/2016/01/Deflation-Downward-Spiral-Singapore.jpg
These are some commodity price charts:
http://markets.businessinsider.com/commodities/iron-ore-price
http://markets.businessinsider.com/commodities/copper-price
http://markets.businessinsider.com/commodities/aluminum-price
http://markets.businessinsider.com/commodities/oil-price
It seems to me that we have been fighting off deflation for a long time. China was keeping prices up with its growing debt, but that is not working so well now. We can keep our fingers crossed that prices don’t drop much more.
http://markets.businessinsider.com/commodities/natural-gas-price
http://markets.businessinsider.com/commodities/lead-price
http://markets.businessinsider.com/commodities/wheat-price
http://markets.businessinsider.com/commodities/soybeans-price
http://markets.businessinsider.com/commodities/coal-price
Meanwhile, the Wall Street Journal reports, Rising Home Prices Raise Concern of Overheating. According to it, “A dearth of new construction and strong demand from buyers are pushing up prices twice as fast as the rate of income growth, the latest data show, a level economists said is unsustainable.”
Dearth of new construction is pushing commodity prices down. Buyers who are willing and able to pay high prices are high income people. They can push home prices up by 5.8% in a year.
“And they are, of course, still not cheap by any means: the definition of ‘affordable’ is wonderfully flexible here,…”
Yes. WAY expensive, sort of like how Gail (?) was explaining Uber, as a dressed up and undeclared (disingenuous) response to decline. Maybe it still has a useful transitional role in getting from here to…”there.” Are there more effective ways of doing “transition” work, however?
Have “we” even concluded Uber IS more effective? IE moving people from A to B using less resources.
To me it seems like roughly equal parts Uber making a loss, drivers accepting lower pay and tax fraud.
The fact Uber (currently) is cheaper could lead to people choosing away the train or the bus, or their feet. That is a loss in effectivity.
I was in Zurich last year and was speaking to a cab driver on the way to the airport — he owned a few cars and he said some of his drivers had moved to work independently as Uber drivers…
He indicated that Uber fares were cheaper because 1. these drivers are not paying govt licensing fees and 2. most do not carry commercial auto insurance (that covers them if they are operating a taxi business using a private car)
One of his former drivers was involved in a major accident while working as an Uber driver — his insurance company refused to cover him. He was bankrupted.
At the end of the day Uber is nothing more than a better way to hail a taxi — it does not inherently make taxing a taxi cheaper — the reason Uber cabs are cheaper is because they are cutting corners — violating locals laws…
If Uber were not cheaper would it be so popular? Definitely not.
I was in Hong Kong recently and the hotel called me a cab using an Uber type app — it hailed only registered cabs — it indicated when a cabbie accepted the fare and how far he was away.
Anyone creating a first mover software to do this has a solid subscription business model that taxi companies would want —- it is NOT a 60 billion dollar business.
So if I create and app that can be used identify which banks are most susceptible to being robbed — does that mean the cops should give me and my app users immunity — and I should list my high growth business on Nasdeq and become a billionaire?
Uber and Airbnb are bullshit. Just because they are app driven does not mean that they should be allowed to flaunt regulations and laws.
Pre Uber if you were to drive around with a big sign on your car ‘TAXI’ you would have been prosecuted.
Pre Airbnb if you had purchased an apartment building and stuck a hotel sign on the front door you would have been prosecuted.
I recall from a few years ago some kind of ‘affordable, first step on the sacred property ladder’ housing proposed for London which was in something like a container – stackable anyway and pre-manufactured.
But they did have all the usual fittings.
Now, these ‘naked houses’ are a long way down from that. Hardly any fittings or finishing at all!
Something else that is happening is a relaxation of regulations regarding minimum space in new developments, to allow super-tiny studios. Over the last decade or so, doors have grown narrower and ceilings lower, windows smaller in developments.
As people get fatter. 🙂
A nice counterbalance to the IMF’s wishful thinking:
“When the International Monetary Fund met for its spring meeting in Washington 10 years ago the global economy was booming. The world was experiencing the strongest period of sustained growth since the late 1960s and early 1970s and the fund thought the good times would continue.
“There was a bit of concern about the rip-roaring US housing market, but no suggestion that a crisis in the sub-prime mortgage market would be the catalyst for the biggest recession since the 1930s. Even when the trickle of foreclosures turned into a flood the assumption was that it was merely a localised problem that would soon be sorted out. Only when the entire global financial system froze up a year later did everything become horribly clear.
“The IMF meeting of the past few days was supposed to be about how the global economy has at last emerged into the light from its long dark tunnel. Christine Lagarde, the fund’s managing director, radiated optimism. For a change growth forecasts were revised up. The impression was given that everything is back under control.
“The reality is somewhat different. There will be no return to the world as it was in the spring of 2007 for many years, if ever. It was a moment when many trends peaked…”
https://www.theguardian.com/business/2017/apr/23/whatever-the-imf-thinks-we-are-a-long-way-from-the-boom-time-of-2007
One thing that influences the poor results since 2007 is the shrinkage of energy consumption, especially in EU and Japan since 2007. The US is doing a little better.
Now world energy consumption is leveling. The problem is especially falling coal consumption. This may be what brings the world economy down.
Surprised that MSM like The Guardian is going against IMF? I thought they are all in one boat. No?
I am surprised. I thought Guardians positions was: we are all gonna fry and then drown unless we keep giving away power to the globalists and approve of all subsidies, in which case the whole world will become rich and happy.
No, the Guardian is mainstream but also left-wing, anti-capitalist, touchy-feely, anti-carbon, pro-‘renewables’, generally clueless about the true nature of industrial civilisation. They are no admirers of the IMF.
Don’t you just love it how they put that touchy feely message out at the end of articles asking for donations…
I can imagine Greenie Gordon saying to his wife Marge — they do such a good job at trying to save the world — can you hand me the credit card honey —- sure Gordon… let me just finish up me organic cup of fair trade tea flown in from Sri Lanka yesterday…
http://thehill.com/business-a-lobbying/330128-top-trump-officials-talk-up-importance-of-border-wall-as-government
If you won’t give me what I want, i’ll shut down the government. Wahhhhhhh, I want a wall or there’s no govt.! I’m taking my ball and going home!! Meahwhile…
http://time.com/4751913/north-korea-sink-aircraft-carrier/
‘North Korea Says It Is ‘Ready to Sink’ U.S. Aircraft Carrier’
On another front where Trump has also been playing chicken, in this case a game of nuclear bluff, is the latest bluster coming from NK; “Our revolutionary forces are combat-ready to sink a U.S. nuclear-powered aircraft carrier with a single strike,” the Rodong Sinmun, the newspaper of the North’s ruling Workers’ Party, said in a commentary.
Trump apparently likes games with high stakes so this coming week should prove most interesting. I think people that voted for Trump, wanting more entertainment from govt. are getting exactly that as It’s enough to quicken the ol’ thumper.
I understand that US agriculture near the border depends on water from the Rio Grande. Putting up the fence cuts off US access to water. This is not a popular option with those who depend on water from the river.
I will keep in mind to check on that whenever I get communication from a state senator.
Don’t know if North Korea has Russian Sizzler’s, but if they do, I would not want to be on that Carrier.
The Disintegrating Energy Sector Will Make The Entire System Grind To A Halt
https://srsroccoreport.com/the-disintegrating-energy-sector-will-make-the-entire-system-grind-to-a-halt/
AND… if you buy gold and silver all will be marvelous! So believes Steve from DelusiSTAN
Right on, FE, & way off, Steve — they may get it, to some extent, about collapse, but then, they jump off reality SOMEWHERE.
I agree when food, clean water and sanitation become hard to come by silver and gold will be useless. Water is the new silver.
Better to have a stash of TUNA Cans….or travel the world to find a safe Little House on the Prairie…. with several storage containers and still it with stuff. Right Ed?
But you also needs bottles of good single malt … wine … no beer as there will be no ice… and ideally some tins of something slightly more palatable than tuna …. for the end of the world Container Party.
I see no role for gold in said party — if I were Steve I would be redeeming the gold for cash — and loading up a container…
Unlike some of us — he seems unable or unwilling to recognize his mistake. You can lead a horse to water ….
I’m still investigating the spent nuclear fuel issue, but in the meantime i wonder if i could have your (and other people on this forum) advice on something.
Hypothetical advice, just in case i would have a chance.
I’ve taken some precautions. Some are more geared towards “descent” in case my place passes through the “Greece / Venzuale” -stage for a few months to years. Some are more downright survival for “the road”/”mad max” conditions.
The situation:
One of my preparations involves a sailing boat. I own a 24ft cabin sailboat = insurance for collapse, as i can co anywhere and be out of reach of a significant portion of the population, except perhaps some marina areas where speedboat “hunters” might be on the prowl. . It is stationed about 1hr drive from my home, but still needs to pass minimally 2 locks before it makes it to open sea. I can move it closer to home (30min drive, no locks to open sea), but it would add at least 500 $ a year to the bills, which are minimally 1000$ per year and on a bad year (dry storage & some repainting & repairs up to 2000). I own a small shrimping net and some fishing gear for it.
The problem:
It has recently occurred to me that things would have to deteriorate fairly badly before my wife would consider bugging out on this small boat (we also have a small kid). If i wait too long the current boat location might be a trap not worth bothering with. Additionally my in-laws have a large fruit garden and a bit more rural, so even in bad conditions my wife is unlikely to consider the boat option. Therefore the boat only has value as coastal fishing vessel in BAU-lite conditions, but might provide me a self-employed job and income . Selling the boat is likely to be difficult in current economy, but might yield a few thousand dollars. Keeping it will reduce my financial strength & ability to pay the mortgage in case of grinding joblessness (currently still employed, but have to think about that as well). I could also use the money to buy other gear.
The Question:
Do i keep the boat ?
Intelligent hypothetical feedback would be highly appreciated
I though about a small sail boat also (Cal 25 or the like) as the only possible way out of a city like LA or New York.
But you would have to be real lucky, and until you were 100’s of miles offshore, still dicey.
I’ve spent quite a bit of time offshore, and in Asia pirates were a issue.
We somethings carried a 105 Recoilless Rifle.
Thanks for your comment.
Pirates are indeed a big problem. A sailboat can never outrun them, and since it is small i would not have the ability to stay in open waters long enough to avoid them altogether.
Somebody here posted a comment about ‘hiding in plain sight’ and i’m starting to believe this strategy has perhaps the best odds.
I like the 30 floor building leap idea more and more…. more certain that the rock cut…. problem is there are no stall buildings anywhere near where I live…
I remain hopeful of the Fed Ex delivered cyanide-infused chocolate bunny courtesy of the Elders. Perhaps a chaser of a very strong does of Oxycontin to dull the senses….
One key–don’t stand out too much. Don’t look like you have something worth stealing.
Hahaha ! Cyanide infused chocolate bunnies ! I must remember that one Fast Eddy. Yes the odds are bad. Lets say 1/10 survives, call it 1/20 if you are in a bad place. That means 1 chance out of 1600 that my small family of 3 survives.
Notwithstanding the above; I’m a biologist, so kind off trained to think in terms of DNA, competition etc… As such I’m of the opinion all those that are saying now that they will throw in the towel, are underestimating that a significant percentage of us are really geared to fight for survival. Physically & mentally in some way or another even if just passively clinging on and enduring like the survivors of concentration camps.
The only aspect that provides some brake against this behaviour is the group dynamic. Forget about lone robust individuals in Clint Eastwood style, there are significant indications that humans and other “hive” creatures that loose too many interactions / links with the group, go into “self-destruct” mode psychologically. This is why you need small groups, more than for any other reason i think.
However you look at it, “opportunities” to give up will present themselves anyway, so why give up now already ? OK, You might have a chance at a “better” end of your choosing, but then why didn’t you do it already and give the rest of us a better chance ?
Maybe Fast Eddy is just pretending. The unwary will be easy prey. Getting the few that are preparing to give up might also be a strategy 🙂
Ha ha … you got me! I am of course trying to mentally wear down those who might attempt to compete with me when BAU goes…. drive them into despair — force them to throw in the towel….
Actually…
What I am trying to do is explain to people who may be wasting a lot of time and money on prepping — that all efforts are futile — wasted.
Because I have been there and done that and finally came to my senses — after wasting a LOT of time and money — and realized a) I am unlikely to survive and b) surviving would be just that – barely being alive…. a grinding brutal existence.
And that is not even taking into account the spent fuel ponds.
The thing is…
People seem to think that if they can just make it through the worst part… that there will be a magical reset…. because that is what happens when disaster strikes…
But this time is different — there will be no reset — things will not get easier — because there will be no energy. There will be no food.
We may think we will fight to survive but when this reality hits …. even the toughest individuals will soon admit defeat.
Again – I ask that people try unplugging completely from BAU for a week — then come back and tell us how that feels….
Keep in mind that this is End of Days Lite only — you will know that after a week you can plug back in …. also nobody will be trying to murder you to get your food — they won’t be raping your family – they won’t be tying your wife up and ordering you to work the garden — or else…
We all have our breaking points … this will break everyone.
Sorry ; error in previous post: 1 chance out of 8000, even worse
T.Y.
The survival of oneself and one’s family members are not independent events. If you survive, your family members are much more likely to survive also. This would improve your chances of all surviving considerably.
I agree.
Boat might be better than car to leave the city. But then? How many years of food have you got on your boat?
And pirates … post BAU … they must also use sails?
I think most here overestimates the stealing and looting, no one has anything to steal so won’t be worth the effort.
You need to go to cluborlov.wordpress.com. There you will have the opportunity to discuss your boat options with Dmitry Orlov, who is obviously a proponent of keeping and maintaining the sail boat. It’s your best option for a young family, but ideally you should be living aboard it now. In an emergency, your boat will be co-opted by whomever gets to it first and knows how to sail. Also, there is much discussion there about having a destination already scoped out, perhaps a small isolated coastal area with some hidden gardens, fruit & nut groves, etc. You need to think like a hippie marijuana grower.
We’re gonna need a bigger boat!
Thanks for feedback. I’m bussy developing a fruit garden right now, it takes regular pruning. I guess you could start “wild-planting” all sorts of fruit trees to soften the below, but they would likely carry less fruit if untended.
If there is a “mad max” scenario coming up, what will going to sea accomplish? So many problems to overcome, so few solutions. What will you do when you run out of drinking water? What will you do if someone breaks a leg or need urgent medical attention? What happens when you get back to shore? Are you able to repair the boat if necessary?
I would suggest that since chances of surviving long-term in this scenario is slim, you might get more value on betting on BAU(-lite) continuing as long as possible and act accordingly. Keep your boat if you enjoy sailing and fishing. And don’t tell your wife that the world is ending!
What we are facing is a predicament, not a problem with good solutions.
I think I would opt in the direction of selling the boat, and using the funds to buy things you really need and would enjoy now, and for as long as things hold together, or perhaps a bit longer. If the currency holds value, it may even help you pay taxes another year or two.
You didn’t say what you are doing now. That might have a bearing on whether you sell the boat or not.
I’m a biologist, employed as “environmental engineer” for a international marine construction company. This mostly involves writing environmental management plans for construction works, Water quality monitoring. Compliance to permits etc.. etc..
Recently a colleague of mine quit. Mainly because he was sick and tired of the bullshit companies will ask us to peddle as “green”. Although my boss asked for 1 extra, instead management did not even decide to maintain status quo (replace him), so i’m already feeling the effects of diminishing returns in my opinion.
You understand some of the problems then. It would be hard to replace your salary as an environmental engineer, with your earnings operating a sail boat for fishing.
My concerns with the boat scenario are these:
1.) If we do, as seems likely, experience a fast collapse, we will lose global dimming from various industrial aerosols almost overnight. There are a range of opinions about how much cooling we currently have from dimming but it is substantial. We could experience a doubling of current warming. Given how chaotic the weather is getting without this assistance, I would be nervous about negotiating the seven seas with a suddenly aggressively amped up hydrological cycle. Which leads in to point 2…
2.) If everything you need, love and own is on that boat then you are in real trouble (if not actually dead) in the event that it is damaged, pirated or sunk. You are putting all of your eggs in one basket. If there is any hope at all of making it through the bottleneck then it is as part of a strong, intelligent community, which has some redundancy and fallback built in.
3.) Making landfall to re-up on supplies, look for food and so forth will always be a lottery, even if sites have been scouted in advance. Outsiders who are competing for resources will not be welcomed with open arms, to put it mildly.
Harry, if we just look at the 3 days that planes were grounded in the US between 11-14 September 2001, the increase of temperatures worldwide with the fall of BAU could indeed be substantial:
http://www.greenmedinfo.com/blog/artificial-weather-revealed-post-9-11-flight-groundings
“re-up supplies” where? Fast collapse means global collapse, nothing will be for same and no currency will be accepted.
I was thinking of supplies pre-stashed by our theoretical captain rather than obtained from supermarkets, DJ.
Ok, that seems reasonable, but that kind of stash could you have without a boat. Then you “only” risk meaningless violence.
Fetch three months of supplies at a time and if you have visitors put up a good show and beg to at least keep a little moldy bread.
Dear Harry,
You make some good points. Especially 2 & 3 had crossed my mind before,
As Gail says, there are no good solutions. I guess my main concern is really related to “how fast is fast collapse” Weeks ? Months ? Years? Rome took decades of decline before it finally fell. So i’m kind of worried that betting on very fast (say 2-6 months collapse) might be dangerous, especially looking at how the situation in Greece, Venezuela, Syria etc has been dragging on for several years really. And thats probably not even collapse proper yet in the case of the former.
TY, Venezuela and Greece are like gangrenous extremities on the ailing body economic. When the totality finally goes down it will likely do so quickly. What is much less certain is how long we have until that happens.
I think we *can* reasonably say that by around 2020 (if we make it there), the current swingeing production cuts and paucity of discoveries will cause scarcity and try to push oil prices back up to economy-crushing levels. Personally my feeling is that something gives before then (Italy? China? US debt ceiling? US auto subprime or student loan? But probably something almost no one sees coming.)
I know that singling out key triggers in what is a cascading and incredibly complex process is an iffy business but, having studied Gail’s work closely, the collapse in oil prices in 2014 felt to me like the ‘starter-gun’ for collapse. I took the view then that SE England (halfway between Dungeness nuclear power station and the hungry hordes of London) was not a safe place for my family to be long-term and relocated us to an island off the Scottish coast.
I did give the boat idea some consideration but, aside from a variety of other practical issues, I have zero nautical experience and didn’t really feel I had the time to learn. To be honest, I’m not sure there are any good solutions for the future, so I am making a point of enjoying life as much as possible right now.
Very smart move, Harry. Zombies of the instadoom won’t reach scottish isles, presuming you need a boat to access your island.
Thanks for the validation, Slow Paul. It sometimes feels like a crazy thing to have done but consensus thinking on the economy, human nature and our likely future is clearly deeply flawed and I found Gail’s analysis significantly persuasive to want to get out of Dodge.
You would certainly need a boat to get here… Of course if FE is right about the nuclear issue then that’s probably moot – Hunterston nuclear power station is about 60 miles east on the mainland – but we’ll still go down popping Prussian Blue and Potassium Iodide and generally doing our best not to die.
I presume the wind is mostly blowing west-to-east in your area, then the radioactive fires may spread mainly eastward from the NPS!
Just heard the 36:54 video in the piece linked above
++++
https://www.youtube.com/watch?v=syjOASid0Js&feature=youtu.be
ITEOTWAWKI is spot on with the Thelma and Louise picture. To complete the visual please envision a big fat banker/Wall St tycoon standing on the cliff. Attached to the car is a very long bungee cord. The other end of said cord is around the banker’s waist.
Banker’s must think they are exempt from SEC Rule 156–‘past performance is not a predictor of future results’. Yea our financial system is stretched, but this time the tycoon will be snatched off his high place and catapulted to the bottom of the canyon ahead of the car. The financial system has always been dependent on the real economy to pull it along.
Credit Suisse: “Barely a quarter into 2017, year-to-date retail store closings have already surpassed those of 2008.”
According to the Swiss bank’s calculations, on a unit basis, approximately 2,880 store closings were announced YTD, more than twice as many closings as the 1,153 announced during the same period last year. Historically, roughly 60% of store closure announcements occur in the first five months of the year.
By extrapolating the year-to-date announcements, CS estimates that there could be more than 8,640 store closings this year, which will be higher than the historical 2008 peak of approximately 6,200 store closings, which suggests that for brick-and-mortar stores stores the current transition period is far worse than the depth of the credit crisis depression.
More http://www.zerohedge.com/news/2017-04-22/retail-bubble-has-now-burst-record-8640-stores-are-closing-2017
I can believe this.
Gail and all others do you believe this power point is accurate? HELP!
http://www.feasta.org/wp-content/uploads/2017/01/Systemic-Change-Rev-7.pdf
I basically agree but it uses “the average” so things will be more complex as some areas and some producer stay alive longer than the average. But basically yes we are coming to the end of FF.
The part they can not say is 99% of the people will need to die to allow a new system. The “happy” part we need to d nothing the four horse-persons will do it for us.
we need do nothing
Yep the impact is imminent…about the “what do we do now”….absolutely nothing…the Thelma and Louise Ford Thunderbird (as a metaphor for Industrial Civ.) is already in the air about to fall and Wile E. Coyote (also a metaphor for IC) is suspended in the air off the cliff and he is just about….to look down..and you know what happens to him next when he realizes he’s in the air…it’s bubye BAU and IC..
I think that the world is headed toward a near-term global financial shock that is energy related. In that sense, I agree with the presentation.
The presentation includes a lot of stuff from different authors, including many things I recognize as my own.
I think the problem has even more to do with falling coal production than it has to do with an oil problem. We are dealing with low prices for oil, coal, natural gas, uranium, and many other things. These low prices are likely to bring the system down (if something else doesn’t bring it down sooner, such as failure of the US to agree on a funding for the economy. Something as simple as a government shutdown could be the end.)
There are quite a few things in the presentation I don’t agree with. The BW Hill stuff is not really right, for various reasons—trying to prove the wrong thing; even within what he is trying to prove, BW Hill calculations have a lot of problems.
I agree that it is crazy to think we have a choice of fuels; we need “all of the above.”
I agree that the oil industry is going bankrupt. So is the coal industry and the natural gas industry. Without those industries, the world economy is out of business.
Debt levels are promises for future energy, and things made with future energy. We now need more and more debt, to keep the economy going.
I don’t think Tim Clark’s ideas for what to do now on Slide 71 are helpful. Electricity will fail at the same time as oil (or with at most a year or two difference). The problems will look financial, probably not oil related.
At the end of the day, to sum it all up in one sentence, the Global Financial System is stretched to the breaking point, it is stretched to the breaking point because of REAL resource limits, and next crash à la 2008 (which judging by all the bad news coming out on the Global Economy in a way not seen since then is probably imminent, i.e. less then 2 years time) , CBs will not be able to paper over it and it will bring down BAU and with it the whole IC…That’s why its imperative to enjoy and savour every day BAU is in place, because its days are counted…
Thank You Very Much Gail! And thank you for all the work that you do! 🙂
That presentation is broadly accurate, but obviously there will be details in it that will be wrong—forecasting accurately on that scale is impossible. I pitched collapse in the mid 2020s a year or two ago. Everything would seem to point to that. though I’m the first toadmit I could be wrong.
The most serious point(s) missed are the results of it. Economics are a major concern obviously, but the social aspects are far worse.
The seriousness lies in denial. No politician can admit to failure, and economic collapse will be seen by most as a political failure.
Hence you will have the the rise of extremist politics promising to ”fix” the problem.
that is happening right now.
As the economy crashes, civil unrest is certain.
Civil unrest will have to be controlled.
that involves military force
and that will require dictatorial powers (temporarily of course)
Imagine, if you will, what Trump will (not might) be like if he takes “emergency powers” to control civil unrest.
That won’t stop the decline, so repressive measures will become harsher, because future governing measures can only be based on past experience—meaning that mutinous mobs have to be forcibly suppressed. (check your history).
As with most writings in this genre, the author concludes with the eternal mantra:
A new economic model must be found before collapse arrives
————
Quote: Educate and prepare Irish society for an economic and energy shock
– Despite the warnings – we were not prepared for 2008, the next one will be systemic
________
Quote:WE URGENTLY NEED TO START MAKING CHANGES AND PREPARING FOR AN ENERGY AND FINANCIAL STORM AT ALL LEVELS OF SOCIETY; INDIVIDUAL, BUSINESS, PUBLIC BODY AND GOVERNMENT.
The Irish are a lovely bunch of people—easily one of the happiest places on the planet–but the thought of “educating” them for what’s coming is wishful thinking at its most fanciful
Interesting to see how the Saudis have had to capitulate regarding their reforms – 20% salary cuts to state employees (most of the population) etc. They just weren’t going to wear it.
Wholly unreformable until The Crash.
On numerous occasions I’ve said that a sudden trigger for collapse will be the implosion of the Saudi social structure, which will in turn cut off our oil source from them. Right now the Saudis are making it clear that their oil is running out
To the godfreaks there, the collapse of the infidel west will hasten the spread of islam, because there will be nothing to stop it.
it doesn’t take any great intellect to figure out that the spread of islam is being prevented by oilpower
I would expect that reducing immigration and trade would tend to reduce the spread of Islam.
On the other hand, the big push for immigrants in Europe in recent years has added a huge Moslem population. I imagine that these people are much more active in their faith than the many nominal Christians in Europe. They could have a disproportionate influence, relative to their numbers.
that has always been part of my thesis
that come SHTF time, groups will coagulate for mutual security. The Muslim population here is more cohesive that the Christian, it will be the religious wars of the middle ages all over again
http://megacancer.com/wp-content/uploads/2017/04/Bush-abdullah1.jpg
The ‘new economic model’ is a mere few hundred thousand human beings at most (not 7.5 million!) living off whatever they can spear, trap, or pluck off bushes. Perhaps herding might be possible in some regions.
No-one can advocate that and gain support, or even be thought to be still sane.
Nor is there any way to transition to it in a planned fashion.
“Nor is there any way to transition to it in a planned fashion.”
By transition to IT means that IT is a foregone conclusion. Meanwhile, I’m not suggesting that there’s any future for anything or anyone without some kind of industrial system. No one has figured out how that industrial system–not one that is globally networked from the top down–would work, and neither is there much effort to find out. I’ve been thinking that, as collapse ensues, there are rather desperate baby-step-moves toward the Ubers, the air bnb’s, the “smart-growth” communities, the revival of the inner cities, etc. Most of these are hogwash in and of themselves, but a resistance movement could co-opt them.
However, there is no resistance movement–which would result from a level of planning, co-opting, and synthesizing hitherto unknown.
I don’t understand how we resolve the tendency to believe that social unrest is palliative to any kind of resistance movement. It seems that just the opposite is true. Calm, and shutload of strategy and planning could be better.
Taking the broad base of any society, if the majority are well fed, housed and employed with a living wage, and recognise that their government isn’t too corrupt, then revolutions don’t get enough traction to kick off.
This was why, here in UK, they started a massive slum clearance and housebuilding program after ww1
If on the other hand you kick away too many of those support factors, then ultimately violent unrest is inevitable, because even the forces of repression–police and military–become unsupported by the government that employs them.
In a collapsing economy, such as we are facing, no form of planning is possible, because you can’t plan ahead for something never before experienced.
Even responsible polticians can only base contingency plans by reading history books, and that really isn’t going to work this time.
No planning is possible..
Well.. yes.. and no..
No planning like we are used to.. But other types of planning.. well nothing actually twists your arm that all planning is beyond impossible..
Say you have a family of 15 able bodied people. Nothing actually says you couldnt give them clear instructions, even on a very short notice, everybody has a personal responsibility to get/have/aquire/tend:
– potato field to get 200lbs of potatoes personally
– a garden that produces 200lbs of fresh produce to that person, cared and grown by him personally
– bushes or berries 200lbs picked by that person
– wild vegetables and wild herbes 200lbs by that person
– fruit trees or mushrooms 200lbs
– and a choice between four options, having boxes of mealworms, chickens/ rabbits in coops, or a year round greenhouse to give the wabbits something else than hay all winter
“Your job, should you choose to accept it, is to..” planning like we are used to is impossible.. but planning things differently from before, is not beyond impossible, though
but surely that is planning based on previous experience—we can guess there will be food shortages, man has been through that before.
what we can’t plan for is a total breakdown of society because our energy support system has collapsed.
That will put us into uncharted territory, because no civilisation, has ever faced a situation where there has been no energy resource anywhere.
famine in different regions yes, due to various reasons, but nothing on a global scale such as is likely this time.
Exactly.
7.5 billion hungry desperate people — and very few people with their oases of organic prosperity.
It is just absurd (delusional…) to think that anyone with this sort of plan is going to be left alone.
In Ireland during the famine – the military and police protected the crops from the hungry.
Nobody will protect your crop when BAU ends – in fact those you would be hoping to help — will be the first to help themselves.
The team leader would have a plan as well — to identify sources of food — and take it using extreme force.
I presume that you have a whole lot of land, and better growing conditions than most of us do. Also, there needs to be a lot of planning to make/keep the soil fertile, and not suffer from erosion. One big problem is storing food for winter–I don’t see any mention of that. This is why grain is used so extensively today.
It would be interesting to hear what the Bosnian war survivors would say, what kind of plans they have. Theyve gone through it once in their lifetimes already. Except this time the crap wont end, ever.
Sure.. like Ive commented many times before.. 7.5 B Apex Predators let loose, is.. hmm.. R-rated shall we say
But the question in my mind is either Eddy/ITEOTWAWKI do nothing strategy. Or the strategy that numerous others here have as well.. just keep busy untill the fat lady sings.. guess thats a personal choice to be made..
If it makes people feel better to do something — other than enjoy the remaining days to the fullest — then I highly recommend people do whatever makes them feel better.
It is completely futile — and it will make you a target for the bad guys looking for food — but in the meantime — if it keeps people sane — then it is justified.
“what we can’t plan for is a total breakdown of society because our energy support system has collapsed.”
How can you say this Norm? Everyone on FW expects the globally networked energy system to collapse. What’s stopping us here from planning in any way we see fit to address what we know about energy-about-to-collapse?
“That will put us into uncharted territory, because no civilisation, has ever faced a situation where there has been no energy resource anywhere.”
If the territory is uncharted, you can’t know if what you may plan is workable or not. You can’t plan for the unprecedented by referring to what worked or didn’t work in the past.
You have defined industrial civilization as reliant on explosive energy that creates rotary motion (a definition that has considerably upped my game). Now without getting into tangled woods of defining exactly what is the big-picture, indisputable definition of all energy–I hope you’ll allow some speculation about it:
Energy is often counted in terms of calories–as exclusively being something like gasoline which allows a car to run. But could there also be a psychological dimension to energy?
One day a person eats a lot, but because they are depressed they stay in bed when they aren’t actually eating. Their weight increases too. The same day, another person, who isn’t depressed, is energized by some exciting project and skips a couple meals. Their weight goes down and they feel better and gain in health. And they get needed work accomplished. The energy of the big eater counted for nothing, and vice versa.
You can create social incentives to produce more psychologically driven work. You can do more with less.
But it is *impossible* to make globally networked, industrial civilization of 7.5 billion people work without (apparently) cheap fossil fuel energy. No one is saying it can be done, only that this globalized, capitalist civilization is not the only subject for consideration.
future existence is very difficult to define from the position in which we find ourselves at this point in time.
The bottom line for energy is that a sedentary adult needs 2000cal per day…whereas a highly active one will burn 4000+ a day. If you stay in bed to conserve energy, then someone has got to bring you your food.
You could link that to climate—the Inuit burns more bodyfuel than an Amazonian, just to stay alive because sun-heat gifts most of the Amazonian’s energy needs, whereas the Inuit has to fight for every calorie he eats.. (which is why civilisations grew in warm countries not cold ones)
They might be at opposite ends of the energy spectrum, but without that intake, they will die.
there is no form of energy other than that defined by calorific count (as far as I am aware).
If you need to do sufficient ‘work’ to support your immediate family, then you will require a sufficient calorific intake to do it, to support your own body, and the bodies of your dependants.
If you can’t do that, and no one gives you food, then the outcome is brutally simple: you and yours die.
That said, we who live in the median areas of the planet, have organised ourselves so that food is delivered on a collective mass scale, courtesy of oil and wheels.
Relatively few people with the means to read this website will have retained the means to support themselves away from it in the absolute sense of the word “support”.
Call me an old cynic, but those guys on TV in the arctic seem to use a lot of petrol and bullets, and trade furs to buy them.
If somebody gave me 10 acres and all the necessary seed and machinery, I would still screw up—I do not have the knowledge to produce food year on year and preserve it year on year. (let alone defend it)
Most people in the developed world are like me.. You cannot learn farming from books.
As to fundamental collapse, some can plan for it, and a small proportion of those who do will no doubt survive it into whatever the future brings, but that will be a matter of pure chance I think, because we cannot plan for every contingency because this has never happened before.
It is those sideswipes that will be new, no references to what they did in the 17thc or whatever can prepare you for lunatic leaders with fragile egos prepared to nuke each other to prove a point.
Or the population growth problem that is on course to take us to 10bn or more mid century. No references to past history offers instructions on how to prepare for that, or for the catastrophe that is certain to prevent it.
Wiil it be :
War?
Pandemic?
Methane release?
it has to be one of those, nothing else would be big enough to do it, if we discount a meteor strike or the rapture.
Previous famines, political collapses and so on have always, in the past, been local. We are talking ‘whole earth’ here, because our interlocked support-web cannot be untangled. The vast majority carry a certainty that our future will be better tan our past. OFWorlders and their ilk are in an insignificant minority, (sorry guys)
Our support web will be broken, yes, but in a way that is involuntary and which will leave the majority without any form of life support
That will leave isolated pockets of humanity, some prepared differently to others, all open to the laws of chance alone as to whether they survive or not.
One thing we do know with great certainty … is that … the post BAU world will be horrific for anyone who might be so unlucky to survive…
Anyone who disputes that is truly delusional – or has been watching too many Little House on the Prairie re-runs
Hey VK, I am not willing to prepare because I as well think it’s a waste of time. No matter how much preparation you put into it, no one has ever really lived outside of BAU (unless you’re a Kahalari or similar Hunter-Gatherer)…not even that couple with their kid in remote Alaska that I posted a few weeks ago here on OFW were really living outside of BAU…I think even if we would bring someone from before BAU with a time-machine, even he would find it hard since the biosphere has been degraded so much since his time. But like FE said, if it makes the person happy to prep, all the power to him.
On another more philosophical level, my question would be why bother to live in post BAU even if it could somehow miraculously work, especially if you are a First Worlder (like most are here on OFW)…life will be brutal, violent…no happiness whatsoever…the struggle to survive would be daily if not hourly…the nice thing about being human vs an animal is I can stop this miserable life and say to myself “I so don’t have to take this sh.t”
Anyway that’s my take…
Anyone who is alive within a year of the end of BAU —- will wish they were dead.
Mark my words
Also, common sense should tell us that if an avalanche is approaching (AKA total collapse), you don’t wait till it hits you to get out of the way. As soon as you get the sense from far away that it’s heading your way, you run like mad. That would be tantamount to planning and working like mad today.
Isn’t it silly to assume everything will be fine until it isn’t, and then we will all be dead within a week?
Society has a year supply of food laying around. Doomsday prepping could fill a gap between when store shelves get empty and before rationing begins, also higher food quality.
Vegetables and potatoes can/will be stolen, but not necessarily destroyed, so you only lose what is harvestable.
Berries and mushrooms and wild vegetables are there the whole time. (But I think a square km can only feed a few people)
You lose the rabbits and chickens, but not their feed.
Anyone who thinks they can live off of what is in their garden and what they can find growing wild (btw birds will eat most berries unless they are netted…) really needs to do a test run of this before BAU ends. Just for fun.
I have a massive garden – a big orchard — not sure what I could eat out of the bush… and there is no way in hell I could keep myself fed year round… no way in hell.
@Norman
Again, that’s another showing of what harm Chuck Fitzclarence did to the Western Civilization.
Without Brigadier Chuck’s messup, there would have been no reason to clear the slums. The poor would have continued to use little resources, and penury would be the lot for most pf the people, which would have saved the world.
FE,
I mostly agree with you. I only pointed out that some of VKs “food sources” is not possible to steal, and also that it is not possible to live of the land with a much lower population density.
Other than that: potatoes and some wild vegetables up closer to 1000 kcal/kg, berries and most vegetables 500 kcal, mushrooms less. You probably need double of what VK suggested.
It would be hard work not only gathering but also eating that amount without added fat. If chicken farming (eggs) is successful things looks much easier.
You also need firewood (or something equivalent). Potatoes need to be cooked, and many vegetables are more nutritious if cooked. A great deal more energy is required for, say, canning the vegetables. Somehow, the containers need to be made, with the lids. Pickling is a much less energy-intensive operation.
There is likely to be a lot of spoilage, if someone is planning to grow perishable crops. This will influence the amount that needs to be grown as well.
No time for pickling … too busy washing clothes by hand … and dragging wood from increasing distances because all the nearby trees have been cut down already.
Of course you are correct Gail. VK has a scandinavian perspective, we can relatively safely say that water and firewood is a minor problem.
Growing/gathering five pounds of food and then eating all in a day is a bigger trouble.
Jan-Mar being the hardest months, two+ months after last harvest and no realistic gathering.
Lessons from OFW
None of us in industrial society has any idea how to grow enough food to live on. And it would take a very long time to learn. Were BAU to break down somewhat suddenly (although I must say that it appears to be breaking down in pockets all over the place), there would not remotely be enough time to learn, and we’d have FE’s scenario with little doubt.
We are not on a trajectory to feed ourselves and maintain order. So we can do much praying that BAU finds some weird, unprecedented way to keep going, especially in such a manner as to allow for a great upsurge in professional local or near-local food production. But BAU isn’t necessarily going to supply the latter.
If the globally networked financial system, now indispensable for all globally networked production, cannot possible be maintained, some novel kind of global living arrangement would be needed. Global living arrangement doesn’t mean the current financial, capitalist global system we have now. What it would mean is there would have to be a new (or perhaps also drawing from the old) kind of production that enables the self-organizing global “whole:” to survive. That would require networking and coordination, as much from the bottom up as the top down. Since, by definition, nothing like this has ever been done, I don’t know what it would look like. I know it has to include indefinite monitoring of nuclear facilities. And I think better organization for food production and maintenance of order…at the the county or parish level.
But it would be sheer and utter madness to wait for disaster to strike before TRYING to create that alternate type of network. Since humans tend to change course only after disaster strikes, the task of erecting an alternate structure–one that is not absolutely needed right now–is most difficult. Trying to do so will inevitably appear to be futile, but that sense of futility is also an illusion. Trying is more important than anticipated results.
It also doesn’t make sense to focus too much on individual prepping. Everyone has to be MOL on the same level of prepping. It is collective action that matters most, although individuals must play their part within that collective whole.
Artleads,
I have hopes that collapse will be slow enough for some governments to understand our predicament and promote (subsidize/teach/support) local food production, i.e. in backyards, commons etc.
It is futile to prepare for instadoom, but one can prepare or make some plans for BAU-lite because that might be a thing for several decades to come.
nice idea
but can you imagine the reaction of the general public if any government created a minister for self sufficiency, because 10 years down the line our supermarkets were going to be empty?
this isnt like ww2 when hit ler was on our doorstep, and rationing was the only logical thing to do
Another day starts … and the electricity is still on…
You are exhibiting EXTREME Delusional thinking
Norman,
my guess(hope) is that the public will become increasingly aware of the predicament as well as the bad news keep coming in. 10 years ago nobody knew what a “green party” was but now they are almost in every european parliament. There will probably not be a minister of “end of the world” but the narrative might be something like “grow britain great again!” to make people become more self-sufficient.
Sooner or later people will get tired of watching cat videos on face-book and start to question what is going on in the world…
I thought green partys all over the world had been hijacked by people interested mostly in global wealth redistribution and gender neutral toilets, with little CO2 certificates and solar panels on the side.
The presentation is wrong in two aspects:
1. Oil extraction can use coal and gas energy to produce even if EROI is lower than 1. Oil is so valuable that this is being done in Canada and maybe also in the fracking area and in refineries.
2. Financial problems with debt can only occur when someone wants his money back. As all bankers know that this can not be done, they will simply increase the money supply by issuing credit and never asking it back. FE does not like it because he says it is a perpetual motion machine. Unfortunately money does not represent any physical law.
When you look at the trading algos, they simply push the stocks higher and higher, that’s what they are programed for. It works. That also works for debt.
I reiterate: neither financial crash is imminent nor oil crash but climate crash.
We all have our guesses how it all will proceed..what the crash schedule is..
The plunge protection team can print MSM articles of superb investment opportunities in oil and shale. And behind the curtains, the wizard of oz can print a few trillion and buy up energy company bonds. Sure.
To me it still looks like I said a year ago. 2017 will be filled with financial wizardry. 2018 will see some even more dire measures from TPTB. The Twilight Zone deepens. The system starts to crumble in 2019. But the reason will be food. Climate change, food, sixth mass extintction, collapsing fisheries. Something that is related to the physical limits of our finite world. And to me, the schedule looks like, most of the 7.5B wont see 2021..
But we all have our guesses, I think
I somewhat agree. Sooner or later there will be oil shortages and price spikes due to insufficient oil exploration/production. But financial problems can be papered over. Energy resource problems can be somewhat mitigated (getting by with less).
I think the first (big) step downwards in my staircase view will come in the hands of one or more terrible famines and proliferation of disease. This will be caused by climate change / ecological disasters.
REIT shorts still in moribund state as only shadowing their mid 2016 bottom lows..
No rush, no panic, keep calm. Wait for the plungers to sanitize everything again.
So in France, it will be Macron (@23-24%) vs Le Pen (@21-22%), which means no frexit, thank you!
Updated result:
Le Pen – 24.3%
Macron – 21.4%
Still just projections though…
Macron slightly up again. Opinion polls very strongly suggest that he would have the upper hand against Le Pen in a run-off, so, as Dorvek says, Frexit now looking unlikely.
But what if LePen wins? Wouldn’t that mean she would force frexit?
Le Pen won’t win, first poll post first round gives Macron at 62% whereas the winner usually comes at around 52%, can’t touch that!’
We knew that it most likely would be Macron (aka Micron), since TPTB’s modus operandi is usually to pre-manufcature the most freakish synthetic candidate on such challenging occasions (fracturing political landscape), so for example, apart from his banker and socialist affiliated past inside currently the most hated french gov in recent history (he stepped down shortly before the hot campaign), now listen carefully: “Mr Macron (39) is married to his former French teacher Brigitte Trogneux, 20 years his senior, and has seven step-grandchildren.”
Instead the issue of this very election was buried elsewhere..
Namely, how much support comparatively gets the sane candidate like for instance true nationalist – republican (neo Gaulist) Francois Asselineau, well although he stirred the waters in recent weeks, but he got ~1% in this first round, lolz.
So, looking at it from short term perspective, can kicking is always welcomed, it will take years before Macron proves in the open to be another clone of Sarkozy-Tsipras or such. But longer term, we have to accept France as we knew it, doesn’t exist anymore sadly.
Classic MSM article reassuring the clueless masses that we are awash in oil. Nobody has ever heard about The Triangle of Doom…
https://www.bloomberg.com/gadfly/articles/2017-04-23/u-s-shale-s-the-wild-horse-that-opec-just-can-t-tame
Is it only me or it is happening everywhere – there seems to be less an less talk about renewables or those “utopian solutions” in many sites or I missed out something. It seems that the number of people who sense something is seriously wrong is rising rapidly. Most of the talk is about war, economy, police state, etc.
CTG, it is not very scientific, I know, but I am in the habit of taking a daily snapshot of the global economy via a parsing of the mainstream news. If you know what you are looking for you can piece the unfolding OFW story together like a quilt.
Of late I have certainly noticed a ratcheting up of apocalyptic language (words like ‘collapse’ and ‘panic’ occurring with greater frequency). I also read that Google searches for WW3 are at an all time high.
I think a lot of people in ‘developed’ nations are starting to intuit that our cosy assumptions about the future are ill-founded, although most are still assuming that the problems and therefore the solutions are primarily political.
Among other things, the belief that wind and solar will save us is starting to have big “cracks” in it. It is becoming clear that use is way too expensive. Cutbacks are coming in many places this year.
Hard to understand how someone can view this … and not get physically sick….
http://assets.bwbx.io/images/users/iqjWHBFdfxIU/icbkDFACM4iA/v2/800x-1.png
This has to do with low prices. If prices kept rising, we would find low and lower quality resources that we could use.
$100 oil earlier in the decade barely budget discoveries… so as expected we flatline at $50… with an economy that cannot handle $100 again
https://nmamfqlmsh.files.wordpress.com/2013/09/1362724811_shutterstock_12893383.jpg
I agree, there was an extended period of time where oil prices were over $100 per barrel and discoveries never approached the scale that were in the 50’s and 60’s..
Agree with you Gail. Hubbert knew about shale oil (the fracked stuff) and oil sands but didn’t consider mining them profitable enough to seriously consider. By rights, they should not be. Also, deepwater oil that is very expensive to produce. I guess some further resource extremes would be oil shale (the rock that burns) and perhaps tapping the hydrocarbon seas on Titan.
He was only taking conventional oil into account, not stuff like shale that needs to be mined etc. Which is what counts in the end…Hubbert fundamentally was NOT wrong, about anything….except the belief that uranium would ride in and save the day.
Uranium is of course subject to diminishing returns as well. Furthermore, we need fossil fuels to make nuclear reactors, and to decommission them. Uranium could not save the day, just as wind and solar cannot.
If nuclear had picked up the slack as predicted — we would be peaking on uranium by now… no doubt
And who could have known that we would be willing and able to extract shale oil — at huge losses … using financial gimmickry…
Ultimately, 90% of all the oil that will ever be extracted will be conventional oil. Shale and all the other unconventional stuff just doesn’t matter in the end…
A lot of those oil wars were all about keeping the dollar front and center for oil trading. That dollar dominance seems to be weakening
Harry,
Check out a guy named Clif High. He tracks language use in the media and uses it in what he calls ‘predictive linguistics.’ Maybe he’s just a fortune teller on steroids, but it’s entertaining and interesting.
Thanks, Edwinlloyd – will do!
In my part of the world Mars colonization is trending strongly.
I suppose the reasoning is we are gonna fail saving the climate and everyone will die, so we need to have a plan B to sit still in the boat. Strangely no peak oil talk, how will we be able to keep burning enough to destroy the climate?
Even if global temperatures would rise by 10 degrees celsius, living on planet earth will bei a million times easier than colonising mars. This is just a fantasy to keep the people in the “technology will solve all problems”-loop.
“Paging Doctor Oz! A patient calling itself The United States wandered into the emergency room disoriented, wearing a filthy warm-up suit, claiming it was “the greatest” this and that… but was unable to complete the nine-page admission protocol or present valid insurance ID. Patient is growing increasingly violent, threatening staff and other patients….”
-JHK
DIAMONDS AREN’T FOREVER
WITH THE INDELICATE SOUND OF A BAROMETER INSTANTLY FALLING FROM FIVE MEGABARS TO NONE, SOMETHING VERY BAD HAS HAPPENED IN A HARVARD LAB: THE WORLD’S FIRST & ONLY SAMPLE OF METALLIC HYDROGEN HAS GONE BANG !
“An attempt to study the properties of metallic hydrogen appears to have ended in catastrophe after one of the two diamonds being used like a vice to hold the tiny sample was obliterated.
https://vvattsupwiththat.blogspot.com/2017/04/diamonds-arent-forever.html
If we destroy the climate on Earth and Mars has no climate, then why don’t we just restore the climate on Earth rather than try to build a climate from scratch on Mars? It makes no sense to even think about colonizing Mars.
It never cease to amaze me how stupid humans are.
https://pbs.twimg.com/media/C-CL4d7XYAAHzjF.jpg
The thing is even all these people that joined these Marches for Science this w-e are totally clueless about the predicament we all find ourselves in….
Science cannot solve a predicament. Science can observe it and quantify it but, it cannot solve it. To do so would require tapping into another universe where our physical laws do not apply. We can’t do that. I will go out on a limb (large oak limb) and say science will never be able to do that..
I am pretty confident Greg that you will be very safe on that limb 😉
I’m reminded of our half-insane, red-faced, sherry-swilling, gown-wearing, Latin master at school:
‘If you feel stupid here, don’t worry, just wait until to you get outside and see how dumb most people are – you’ll be at the top I assure you!’
https://img.clipartfest.com/a3c78be19bc96c75e80f2bddfc8ad624_15-crazy-smiley-face-clip-art-crazy-smiley-face-clip-art_728-814.jpeg
You ask a very sensible question.
Gail, did you have a nice time in Brussels? And how was your presentation received? I’m assuming that they had some notion of what they were letting themselves in for, having invited you…
The workshop I was part of was billed as an Inspirational Workshop relating to “New Narratives on Energy and Sustainability.”
There had been a somewhat similar Inspirational Workshop a year ago, called “New Narratives for Innovation” that included Joe Tainter.
I suspect that this workshop hit a lot harder, though. Innovation is something that can change a good deal, without a whole lot happening to the economy as a whole. This time the workshop got more to the core of the problem. Also, there were only three of us speakers, and we all had quite negative views.
Mario Giampietro (the organizer) was the first speaker. One of the things he talked about was the impossibility of the “circular economy.” He divided the materials into different categories–materials used for construction; materials that are used in creating food; materials that are used by burning; and other kinds of materials. When he got finished, he concluded that at most 3% of materials could be recycled. The vast majority of materials we use can’t be recycled. Even when materials can be recycled, it often isn’t economic to do so.
Vaclav Smil was the second speaker. He talked about the extremely slow nature of the transition away from fossil fuels. He talked about how much fossil fuels were required to make wind turbines and solar panels, and what a tiny share of total energy production that they had become, after years of trying. This is a slide he showed on global shares of electricity generation. (In this very fancy room, we had monitors between each two participants for viewing.)
Vaclav Smil pointed out that after Fukushima, people in Japan were able to temporarily cut back on their electricity consumption. Perhaps we could do the something similar.
I was third, and talked about several issues related the problems we are facing. Low prices are as much of a problem as high prices. Increasing complexity pushes the economy toward collapse trough increased wage disparity. EROEI (and similar) calculations for wind turbines and solar panels do not tell us much of anything about the total cost of electricity using wind and solar as inputs. I also pointed out that organizations such as the EU are vulnerable to collapse.
I don’t think most of the audience was really ready to hear such stark findings. They were perhaps a bit aware that things aren’t going too well for wind and solar, but what we talked about was more than what most of them were willing to consider. There were a couple of attendees whom I knew from previous meetings, who were somewhat aware of the issues. Also, one reporter came up afterward, and wanted to interview me. I think Mario Giampietro thought that the workshop accomplished what he wanted to do. The attendees were more interested in continuing the current narrative, and perhaps adding one more variable to their models, or slightly “tweaking” the message to citizens. The material will long-term reach a wider audience than the 70 or so participants at this workshop.
Thank you for the summary, Gail.
I fear that such negative but wholly realistic findings will be effectively buried by the EU machine -who wants to hear any of that, it’s too unsettling.
Interesting to see how large a share hydro had in 1950.
Vaclav Smil is the one who is also behind most of the figures I showed regarding energy use back to 1820, back when I put together that post. https://ourfiniteworld.com/2012/03/12/world-energy-consumption-since-1820-in-charts/
Yes, thank you. Personally I live for the moment you report back that a member of your audience has such a shattering epiphany they need to be revived with smelling salts.
As the guru is meant to have said:
‘You want Enlightenment? You fool! Enlightenment will shatter you!’ 🙂
Pingback: Our Intellectual Bankruptcy: The "Religion" of Economics, UBI and Medicare For All snbchf.com
https://robertscribbler.com/
Maybe a third or a fourth failed monsoon in India will be the Black Swan event to collapse the system ?
As with last year, reports are trickling in that tens of millions of people across India are experiencing water stress. Two years of delayed monsoons and severe hot seasons have already left the country reeling. This year’s extended hot season adds insult to injury. Cyclical droughts and heatwaves are normal for India. What is not normal is the present situation of continuously worsening conditions. These ever-intensifying droughts and heatwaves..
When tens of millions of Indians become hundreds of millions.. thats lots of water and food rolled in from elsewhere
Why does India matter? And does that cover all indians? Those valueable to the west can afford imported food and water.
The CBs are printing money like crazy. So what will actually bring this baby down?
If the stock markets can not crash. If the big banks can not default. If the sovereign debts are just always managed. If the energy companies bonds are just always purchased. -how can we collapse?
Well.. somehow the issue for me is pollution in China, drought in India, collapsing fisheries for China and India.. if you print money like crazy on this side.. and then start to import/export food for billions more on that side.. food prices rise everywhere.. less spending everywhere.. layoffs everywhere.. Eddy has a good graph on the death spiral that follows.. even despite stock markets are unable to crash..
Developed democracies are more vulnerable because minimum living standard will only be allowed to fall so low. And we are still far from riot level.
If China goes then the world goes, but can Indias poorer half be divided away? I would trust your estimate more than mine 😉 but I think so.
As long as oil gives enough net energy, skillful enough accounting fraud should keep the oil flowing for a while.
As you write something other than lack of fake money to keep oil flowing may get us.
Here is a better map of the 2 billion people presently importing food
http://www.aalto.fi/en/current/news/2017-04-13/
Nice map.
Venezuela is doing fine.
Now, which of these countries has indispensable resources and/or production?
Production: Japan, Germany, Korea, and(?)
Resources: oil exporters in ME.
In producing countries BAU must continue. In resource exporting countries it is plausible someone else could to their job better.
Interesting how some countries can prosper without significant resources (and banking) – Japan, Germany, S Korea. Sweden and Finland also.
the Swedes, Germans, Finns, Koreans etc, come under the collective heading of ”good traders”
and can run their economies perfectly well on the resources of other nations by clever trading of goods and services. For the time being.
But they still fit into my universal law of national 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.
They fit into the “buy” category there. They are buying energy because they have the skills other people want, that way all parties make a profit.
The Greeks for example used to fit into the “buy” category because they were good traders, then they overshot, and are now reduced to the “beg” category, and will continue to beg until their circumstances readjust to a level where they are self sufficient. (Their borrowing is self delusion)
The Spanish, Portuguese, Italians are headed the same way
As the Mexican oilfields run out, they will go the same way too.
Over time, as fossil fuel resources deplete everywhere, each nation will suffer the same fate, because there will be fewer and fewer nations with whom to trade.
Fit the “law of survival” to any nation, you’ll see it holds good everywhere, over time.
The US has been better endowed than most places, with its coal and natural gas resources, plus significant oil resources. This has allowed the US to use relatively more energy per capita than say, most of Europe and Japan. Cold countries tend to use a lot of energy–Canada, Norway, Russia, etc.
that fits in with the point I was making.
Until the 1970s, the USA produced enough indigenous energy to support the demands of its people
(that was the mythical “great America” period)
Since 1970, there has been a succession of oilwars, to ensure that world oilflow remained uninterrupted enabling the US economy to continue its fantasy of infinity. Though of course there has been meddling in mideast politics since ww1
Germany and Japan tried the stealing method in mid 20thc, now they buy what they need by skilful trading.
But as trade opportunities collapse, they will go the same way
7.5 billion depend on oil for food….
It’s called ten years of the masses getting ever so slowly poorer. It’s a very slow drip.
Poorer, weaker, more stressed, and hence prone to epidemics.
Similar pattern of repeated, and more intense, heat waves in the Iberian Peninsular, combined with violent storms causing lots of damage to agricultural production.
Mother Nature will soon be giving us all a good spanking and sending us to our beds without our suppers. We have been very naughty indeed, and repeat offenders……
India is not remotely survivable when biophysical realities are taken into consideration.
English Majors making signs:
https://pbs.twimg.com/media/C-DffyaU0AAPPAU.jpg
Used to be just ‘Private Keep Out’.
Are ‘similar genre of persons’ the ‘deplorables’ that Hilary Clinton referred to?
I’m off to the local woods now, where the signs say ‘No Public Right of Access’.
There is no right of access, but I’m taking it all the same to get my summer firewood, in a one-man peasant insurgency, in a very quiet English sort of way. 🙂
Viva la revolucion tranquila, Xabier!
No Pasaran!
Well, it’s also occurred to me that one could get away with a lot in daylight just by wearing a hi-viz vest and a yellow helmet – anyone would assume that one was part of some official work party. I must go to the hardware store and get kitted out.
When you know The Way you wish to go , there are always means…. 🙂
Add a clip board and you will be unstoppable.
Yes, good idea, a clip-board, and also a logo: ‘TMN.org’ (This Means Nothing), or maybe: ‘BMF.com’ (Bright Mars Future’)!
It doesn’t mention transgenders… so I assume they are exempted?
McDonald’s introduces new soul-crushing uniforms for our modern dystopia
http://www.avclub.com/article/mcdonalds-introduces-new-soul-crushing-uniforms-ou-254103
https://pbs.twimg.com/media/C-ELhqwUwAI5pg9.jpg
Representing public interest?
The word “Barbecue” has an interesting history. It comes from the Carib word barbricot. The Caribs – whence the word cannibal – used the barbricot, a grill made of green boughs, to prepare their cannibal feasts.
-Marvin Harris, Cannibals and Kings,
Let’s all meet at Eddy’s place.
“Officials from some of the top international government spy agencies have flocked to New Zealand’s Queenstown for a secretive meeting of the Five Eyes spying alliance between the US, UK, Australia, Canada and New Zealand.”
Revealed: The VIPs coming to NZ
http://m.nzherald.co.nz/nz/news/article.cfm?c_id=1&objectid=11842034
https://pbs.twimg.com/media/C-E1vPEXkAAtPFQ.jpg
Why do I always have to giggle a bit when i see that ‘Five Eyes’ stuff?
All-seeing, all-knowing, all-wise?
Some years ago when Twitter was still new, there was this intelligence officer from New Zealand..
I had one Twitter account, then landed upon some freewares from around the world, that analyzed other Twitter users. Tried out these freewares from around the world by making two other profiles, I got the new Twitter profiles to grow by 1000 – 2000 followers a day. Each day.
The rather energetic New Zealand intelligence officer contacted me by private Twitter messages, asking how I do it. How I grow the profiles like crazy. Oh.. she had a very different photo on her profile. Nothing how she really was. After she told me about her need, and her job, she asked not to tell others about her job..
But if her story was true.. Then its kinda strange New Zealand intelligence officers wouldnt know how to use the Twitter freewares of the world. And secondly, why do New Zealand intelligence officers need Twitter profiles that have 500.000 followers growing at 1000 each day?
Just something about the absurdity of the story, makes me think it almost could be true..
Donald Trump has ‘dangerous mental illness’, say psychiatry experts at Yale
http://www.msn.com/en-gb/news/world/donald-trump-has-dangerous-mental-illness-say-psychiatry-experts-at-yale-conference/ar-BBA6XaI?li=BBoPWjQ
http://www.huffingtonpost.com/entry/why-is-there-so-little-popular-protest-against-todays_us_58fbd122e4b0f02c3870eb10
‘Why Is There So Little Popular Protest Against Today’s Threats of Nuclear War?’
“On April 11, Donald Trump, irked by North Korea’s continued tests of nuclear weapons and missiles, tweeted that “North Korea is looking for trouble.” If China does not “help,” then “we will solve the problem without them.” North Korean leader Kim Jong Un responded by announcing that, in the event of a U.S. military attack, his country would not scruple at launching a nuclear strike at U.S. forces. In turn, Trump declared: “We are sending an armada, very powerful. We have submarines, very powerful, far more powerful than the aircraft carrier. We have the best military people on earth.”
During the following days, the governments of both nuclear-armed nations escalated their threats. Dispatched to South Korea, U.S. Vice President Mike Pence declared that “the era of strategic patience is over,” and warned: “All options are on the table.” Not to be outdone, North Korea’s deputy representative to the United Nations told a press conference that “thermonuclear war may break out at any moment.” Any missile or nuclear strike by the United States would be responded to “in kind.” Several days later, the North Korean government warned of a “super-mighty preemptive strike” that would reduce U.S. military forces in South Korea and on the U.S. mainland “to ashes.” The United States and its allies, said the official statement, “should not mess with us.”
“And what is the response of the public to these two erratic government leaders behaving in this reckless fashion and threatening war, including nuclear war? It is remarkably subdued. People read about the situation in newspapers or watch it on the television news, while comedians joke about the madness of it all.”
Did you read that – the response has been remarkably subdued. The article goes on to suggest numerous reasons for this but my own take is because of the internet most people have directed their attention in one particular area of interest or another. In other words before the internet people had a greater interest via TV news as their primary source to get on the same page so to speak, but these days everybody is angled in some specific direction, such as peak oil, GW or maybe they just play some virtual realty video game like Sims. In other words their attention is directed elsewhere.
I for one am really proud of North Korea for standing up to Trump. For going toe to toe with threatening comments. Kim Jong Un didn’t back down and since I hate Trump so much that filled me with a happiness, excitement, a joy that someone could face him down even if us Americans trying to keep our healthcare apparently have no say so over the matter. As ‘The People’
we are evidently powerless to have any influence over what Trump does or wants to do, but NK stuck it to him and now all he can do is shut up. I love it!
The reason nobody is caring is because nobody believes Trump can go to war without congress. And if he can’t even get Obamacare rejected do you think he could lobby for another foreign war after the last two train wrecks? The only way would be another 911 and the elders already shot their wad once so I doubt they could top that dog whistle ever again. Trump is just posturing He knows this is what the Bloodthirsty Christian right lives for.
Our intelligence community had absolute proof that NK was days away from launching a nuke on Seoul. We defended our allies with calculated utility. We destroyed evil Mr. Kim. We made the world a safer place.
See job done and no one will push back.
News was once a main source of entertainment, and an attention-exchange ritual – communal sharing and reading of newspapers, etc.
Now the means of entertainment and attention-capture have multiplied crazily, so real events fade into the background.
This makes the job of the propagandists even easier, as most will only skim the headlines relating to real events.
Saudi Arabia, a kingdom built on oil, plans a future beyond it
https://www.washingtonpost.com/business/economy/saudi-arabia-a-kingdom-built-on-oil-plans-a-future-beyond-it/2017/04/21/6574d2ee-251a-11e7-bb9d-8cd6118e1409_story.html?utm_term=.fca6acff0ebf#comments
There is no way that this will happen. For one thing, the rest of the world needs continued oil from Saudi Arabia. For another, Saudi Arabia will need a cheap energy sources for whatever substitute enterprise it plans to do. This is not going to happen.
I agree – not gonna happen!
One is left wondering just who is giving economic advice to the Saudis
and how much they are being paid for it
I think that there are some US think tanks involved, IIRC.
i could fit that in, between doom mongering in OFW
Norman
They would probably pay you with real estate in Saudi, while they spend the petro-dollars on top-class hookers in Mayfair and Kensington, London.
Stock pump and dump.
Bau light courtesy of Somalia?
https://pbs.twimg.com/media/C-CZGTsVYAAekkz.jpg
http://www.abeldanger.net/2017/04/the-pentagon-obviously-knows-something.html?utm_source=feedburner&utm_medium=email&utm_campaign=Feed%3A+abeldanger%2FzWgH+%28Abel+Danger%29
One of the things I ask myself is, is there something I am missing? Is there some other factor, something that is going to make this system continue? Are people intelligent and reasonable? Am I too pessimistic?
And over and over I keep coming to the same answer: no, we are missing nothing. Our analysis is complete. To give you an idea of how confident I am, I am getting closer and closer to quitting as a physician. I might have one year left in me, tops.
I am ready to throw this all behind and sweep floors the rest of my life. That is how absolutely certain I am of this collapse. And even if I am wrong, the confidence gives me completely freedom of action. I no longer have a sense that I am missing out on anything.
But we’re going to need all the volunteer physician we can find too.
‘I am ready to throw this all behind and sweep floors the rest of my life’
I think there is a robot for that job….
http://www.coolthings.com/wp-content/uploads/2016/03/irobot-braava-jet-1.jpg
Dolph, I once read in the Missoulian about a doctor 95 yrs. old and half blind who was trying to retire in the tiny town of Lincoln, MT back in the early 80’s, but patients kept coming to see him because they had no replacement for him yet.
That could be you one day.
Dolph, I see the same way you do. I am trying to take as much time off from work as i can and do all the things I put off til after retirement. I just do not think things will hold together very much longer. Certainly not 10 years, when I would be first eligible to retire. If you have the financial means I would try to free up as much time as i could.
As nearly everyone has, at age 60, at least one of the main life-terminating conditions or diseases, it is surely folly to put things off until retirement if you can do otherwise.
Retirement as the Golden Age, the great delusion of the oil Age.
Is being a physician THAT bad? If collapse is only 1-3 years away with 100% certainty you could just live of savings and credit.
US Tax Filings Decline 5% Year over Year, preliminary data suggests
https://www.irs.gov/uac/newsroom/filing-season-statistics-for-week-ending-april-14-2017
What’s possibly more interesting is that the refunds rose even as filings declined. This is consistent with declining income and fewer workers filing taxes. Possibly some of it is due to immigrants not filing anymore because they’re afraid of trump’s new immigration stance?
This year, filings were not due until April 18. I don’t remember the exact date filings were due last year. It seems like we need to wait until after the due date of filings to compare results.
Good point! Well check next week! Thanks!
Excellent illustrated story of M. King Hubbert’s life by Stuart McMillen who also illustrated the story of what happened to the reindeers on St Matthew Island:
http://www.stuartmcmillen.com/comics_en/peak-oil/
Forget all the Je suis Charlie, Je suis Paris, etc.. In fact all 7.5B of us are Je suis St Matthew Island 🙂
http://www.stuartmcmillen.com/comics_en/st-matthew-island/
And on that 7.5B population, we are almost there!!
http://www.worldometers.info/world-population/
Stuart McMillen explains Hubbert’s (wrong) theory about peak oil. Hubbert missed the point that oil doesn’t come out, just because it wants to come out. It comes out, because the price is high enough to support its extraction. It comes out because the rest of society has ways that can use the oil that is extracted, in a way that will keep oil price at a high enough level. The oil production has to be inexpensive enough, and extracted with a sufficient lack of “complexity,” that wages of non-elite workers can remain quite high. These high wages of non-elite workers are what keep the oil price high enough to enable extraction.
Once prices drop too low, production can continue for a short time, as lenders allow more and more debt. But eventually, the system will collapse. The shape of the curve will look just like the St. Matthew Island curve. It will follow the “normal” pattern for a while, and then it will fall more of less straight down.
Way too many have believed Hubbert and his flawed logic. There is no 50% of the oil left, for future extraction. Once oil production starts going down, the party is over. The “economics” of the day was not really correct.
++++++
I totally agree Gail, there is no way we are extracting the rest..I still find his story fascinating though..and compared to the reindeer who just ate all the lichen, we need a functioning financial system to extract resources..and when the strain of this leveraged financial system fails in the very near future, there might still be a lot of convential oil left in the ground…but it will stay there forever!!!
At least the reindeer had something to eat….
Effect of Pesticides on soil fertility (beneficial soil microorganisms)
Heavy treatment of soil with pesticides can cause populations of beneficial soil microorganisms to decline. According to the soil scientist Dr. Elaine Ingham, “If we lose both bacteria and fungi, then the soil degrades. Overuse of chemical fertilizers and pesticides have effects on the soil organisms that are similar to human overuse of antibiotics.
Indiscriminate use of chemicals might work for a few years, but after awhile, there aren’t enough beneficial soil organisms to hold onto the nutrients” (Savonen, 1997). For example, plants depend on a variety of soil microorganisms to transform atmospheric nitrogen into nitrates, which plants can use.
Common landscape herbicides disrupt this process: triclopyr inhibits soil bacteria that transform ammonia into nitrite (Pell et al., 1998); glyphosate reduces the growth and activity of free-living nitrogen-fixing bacteria in soil (Santos and Flores, 1995) and 2,4-D reduces nitrogen fixation by the bacteria that live on the roots of bean plants (Arias and Fabra, 1993; Fabra et al., 1997), reduces the growth and activity of nitrogen-fixing blue-green algae (Singh and Singh, 1989; Tözüm-Çalgan and Sivaci-Güner, 1993), and inhibits the transformation of ammonia into nitrates by soil bacteria (Frankenberger et al., 1991, Martens and Bremner, 1993).
Mycorrhizal fungi grow with the roots of many plants and aid in nutrient uptake. These fungi can also be damaged by herbicides in the soil. One study found that oryzalin and trifluralin both inhibited the growth of certain species of mycorrhizal fungi (Kelley and South, 1978). Roundup has been shown to be toxic to mycorrhizal fungi in laboratory studies, and some damaging effects were seen at concentrations lower than those found in soil following typical applications (Chakravarty and Sidhu, 1987; Estok et al., 1989). Triclopyr was also found to be toxic to several species of mycorrhizal fungi (Chakravarty and Sidhu, 1987) and oxadiazon reduced the number of mycorrhizal fungal spores (Moorman, 1989).
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2984095/
=
https://s-media-cache-ak0.pinimg.com/736x/aa/b9/3e/aab93e456cee281cecfdb4ab13f06fae.jpg
When BAU goes down, there is no way I’m waiting to look like that guy (if I haven’t already suffered a violent death). I’ve got my 30-storey building picked out already…it will be an epic jump 😉
Lichen = non-renewable food source in the sense that it grows slow in comparison with rate of extraction by deer.
Sedge grass = limited, less nutritious food source than lichen, but switched to as altenative when more nutritious lichen source exhausted.
Oil = non-renewable food source in the sense that it grows slow in comparison with rate of extraction by modern humans.
Solar, wind, hydro = limited, less nutritious food source than oil, but switched to as altenative when more nutritious oil source (effectively) exhausted (because complex extraction process no longer affordable by economic structure of society, i.e., the rich guys forgot it was the poorer guys that bought most of the oil products, tsk, tsk.).
Good point!
I have to say those few paragraphs you typed above Gail are the best summation of peak oil and energy/economy dynamic I have ever read. So clear and short and simple. Very very well done! I am totally with you. When production comes off peak it will be fairly straight down off a cliff.
And oil renews far more slowly than lichen…
So what would have happened on that island, if the deer all had guns? I’m guessing it wouldn’t have been an extinction event? At least the most murderous of the bunch would have survived?
My guess is that when 7.5B Apex Predators are let loose on the environment, nothing much will remain.. https://news.mongabay.com/2017/04/hunting-is-driving-declines-in-bird-and-mammal-populations-across-the-tropics/
You know there were these stories of the Ukranian famines from back when Stalin was orchestrating things.. there were these strange comments that the “good” people died first.. they who wouldnt commit atrocities themselves, who would protect someone.. who would give resources to the ones even worse off.. so the “good” people died first..
And only the “bad” people survived long enough for the famine to finally be over..
Give the reindeers in St Matthews guns.. the ability to eat meat.. well, a year later only thing remaining will be a creature from native american legends, a creature named wendigo..
You need a large enough number to survive that the genes provide a sufficient range of diversity in the gene pool. I expect that four or eight survivors would have been too small a number. I expect it would have been an extinction event, regardless.
View No 1. St. Matthew Island curve
“Once prices drop too low, production can continue for a short time, as lenders allow more and more debt. But eventually, the system will collapse. The shape of the curve will look just like the St. Matthew Island curve. It will follow the “normal” pattern for a while, and then it will fall more of less straight down.”
View No 2. A somewhat gentler Seneca Cliff curve
The Central Banks will print billions and trillions. Print huge amounts, to buy corporate debt directly. Including oil, shale and other energy company debts, in QE measures, but mostly in secret, and in one extraordinary measure after the other, behind the scenes. Creating an artificial “buffer” for the global economy. Debt levels explode to exponential levels before the total implosion of the global economy. Pension funds and smaller and medium sized banks start to ‘pop’ before the global implosion moment, because interest rates have been too low, for too long.
It would seem the CBs are commited to View No 2..
I agree, the Central Banks are throwing everything at this. Oil/energy production is still rising somewhat because of this. Everyone I know knows something is not right. I know that the economy and oil are starting to decouple as debt is flying through the roof. Once something (we don’t know what or when) collapses it will start a chain reaction and that will become peak oil and the end of oil.
Gail I am totally mind blown! I never considered the second half as not available. Jesus
It is amazing to me how many people have believed this story. It “works” as long as a person believes that prices rise endlessly. It doesn’t, if they don’t rise endlessly.
I have been disagreeing with this story for many years.
It would be a comforting thought to believe that peak oil meant that we still had half a tank of gas to burn through….
Very very well stated Gail! Once we reach peak the party is over. There is no 50% left to extract…it is too costly and unprofitable. The dynamic between the economy and oil/energy cannot be decoupled.
If only the world was split into two fractions, The Hubberts vs. The Tverbergs, it would make sense to discuss who was most right, but that is not really the case. It seems nobody wants to hear about sustainability, even though Hubbert tried 70 years ago.
sustainability = primitive living…
I don’t want to hear about this …. I’d rather be dead
And yet there seems to be a big market for fake sustainability. I guess it is ok as long as we don’t really have to go down in living standards.
Heaven forbid anyone should … take the bus…. or give up the organic fair trade coffee plucked from the shit of a jungle cat then flown 8000 miles to the local Koombaya Koffee Shop.
https://media-cdn.tripadvisor.com/media/photo-s/06/78/6b/aa/getlstd-property-photo.jpg
while waiting in the transit lounge for our plane home from jakarta, i ordered a double coffee luwak, to go, whereapon the local vendor made like he was squeezing the cat twice. everyone had a good laugh and i had a nice smooth espresso. poor cats.
Fracking update on the Permian:
“Shallow, the EnCana/Davidson mass manufacturing “project” in Upton County is very cool to see, but a perfect example of buying a car based on chrome and paint, not how it runs. If EnCana says those wells cost $5M each you can bet your steel toed boots they are every bit of $6.5M. The production data I see on shaleprofile.com is about what you observe on IHS. This is Spraberry country, partially depleted from thousands of vertical wells; I absolutely do not get it.
What I do “get” is that according to fracfocus.com each one of these EnCana wells will require over 10M gallons of water to frac and at least another 1M gallons to drill. At 80 gallons of water per day per human being, in arid W. Texas of all places, it is an atrocity. If they are not recycling flowback water from other wells(even if they say they are, are they?) they should go to jail for that.
To P&A, decommission these massive pads and production facilities to put the land back to its original state: $150K per well.
I think the majority of people in America, including, even oily folks, unfortunately, believe that all this money flowing into the Permian would not be happening unless everybody was making money hand over fist. 1 + 1 = 2. At $2.50 per gallon of gasoline they don’t care, or, in the case of people with any amount of cranial capacity, they are too mentally lazy to do the arithmetic. Permian wells are not going to be much better than any other shale play in the US and we must not forget that for every stacked horizon in each Permian basin, to plug back and start working your way out of the hole is going to require kick-offs, re-drilling new laterals, and new frac’s, almost the cost of the original well. That stacked horizon BS about the Permian does not improve economics very much, I assure you.”
-Mike
My Pretzel Logic indicates we are not looking at the complete picture.
. “Oil is also the only thing at this point that gives the dollar any value. If the FED loses oil it loses the dollar, and without the dollar there is no FED. They will most likely hock the family jewels to keep things going for one more day. Putting a female hobbit as head of the FED may have been a mistake; small jewel case. They will push this thing as far as possible until the Laws of Physics runs over them. You can’t win, you can’t break even, and you can’t get out of the game is riding hard in this direction. Ma and Pa had better hide what they have under the mattress; when this breaks loose their gold fillings are going to become fair game. In this war, King Oil is not going to be taking any prisoners.”
Comment posted by shortonoil
http://peakoil.com/forums/viewtopic.php?p=1356787#p1356787
https://m.youtube.com/watch?v=Xaw0oDqDFlY
Yep, I agree, this has to be done whether or not it is profitable, there is no choice. if it fails we perish.
More from short…same link
Just because capitalism and free markets worked at one time is no guarantee that they will work at another. The apex of that system occurred at a point of phenomenally high value resources; that era is over. Hanging on to outdated paradigms when the system itself has changed is a recipe for disaster. Of course, convincing those that benefited the most from that system, that it may not now be working very well, is going to be a challenge. Because their system worked for a while they managed to embed themselves into positions of maximum power. That will ensure that changes will come slowly, and painfully, and we have just about run out of time to do it! It is getting very close to bend over and kiss your butt good bye time.
What do you mean “if”? Lol…
“We could have saved the Earth but we were too damned cheap.”
– Kurt Vonnegut
My favorite of Kurt
I tell you, we are here on Earth to fart around, and don’t let anybody tell you different
Another Kurt (Cobain) wrote this one of use all here
We have no right to express an opinion until we know all of the answers
First they came for Assange —–
I don’t understand Assange … or Snowden…
So they have exposed what they have exposed…
Does that change anything? Absolutely not. Both houses in the US voted for more – not less spying…. more violations of the Constitution …not less…
The thing is…
The elders have compromising info on everyone — from POTUS to Merkel … and those who are in positions to perhaps do something — are paid very well to turn a blind eye….
Even if they don’t have something in you, they can create something so convincing that pretty much everyone will believe it.
Sorry, on you.
They have something on everyone — so no need to make stuff up — see http://www.imdb.com/title/tt4901306/
Now imagine if someone had access to all your email and all your skype messages…
A quick scan of my skype messages of the past week alone and I see all sorts of discussions about clients with our senior managers that I would not want anyone to see — especially the clients…
What it exposes is how really corrupt the corporate state is…even though they publicly claim otherwise. This is unacceptable to the bosses, as it may cause the people to clog up the streets and disrupt their plans when they discover they have been lied to for their whole life.
Must keep the sheep calm and ready to follow …….Wait….gotta go…My Big Fat Fabulous Life is coming on the teevee.
Everyone knows the NSA is collecting their every digital communication.
Are they on the streets?
No – they are busy uploading more of their personal info to the NSA database… including naked photos of themselves.
They are busy watching sports and Facebooking and American Idoling…
The Elders don’t care much that the public is aware of all of this …. what can they do?
And if they do take to the streets…
NYPD dismantle Occupy Wall Street camp
http://www.bbc.com/news/world-us-canada-15736497
https://upload.wikimedia.org/wikipedia/en/6/64/Uc_Davis_Pepper_Spray_Incident.jpg
That will generally keep people off the streets…. at least while they still hope of recovery…
When things get really serious — then you just do this https://www.theguardian.com/world/2011/nov/24/tahrir-square-protesters-killed-ammunition
Meanwhile Assange lives like a caged rat…. and Snowden is stuck in Russia…
To what purpose?
An Italian newspaper editor offended Berlusconi, when he was in power.
Berlusconi reached for his files, and suddenly the story broke that the editor was paying money to his wife’s lover. How shocking!
But there’s more: the editor and his wife were sharing that lover! How even more shocking!
Career and marriage over.
But note, those even higher up did for Berlusconi in the end…..
“I don’t understand Assange … or Snowden…
So they have exposed what they have exposed…
Does that change anything? Absolutely not. Both houses in the US voted for more – not less spying…. more violations of the Constitution …not less…”
OK, then why do *you* keep exposing this and that, shouting at those who don’t get it and so on?
If the US gov’t threatened me with this for exposing the renewable energy fraud and end of cheap oil story …
http://countercurrentnews.com/wp-content/uploads/2015/07/solitary.png
I would stop. Immediately.
To do otherwise would be – stupid.
I do not believe that it is us that has the capacity to save the Earth. But, I do believe the Earth can save us if we are worthy.
A new report by CreditCards.com shows money is keeping 65% of Americans awake at night, with health care or insurance costs beating retirement savings as the primary source of anxiety for the first time in a decade. That number is up 3 percentage points since 2015, according to CreditCards.com.
The survey found 38% of respondents said that healthcare and insurance bills are making them restless at night — followed by saving for retirement, which has been the number one source of economic-induced insomnia since 2007. Stress about healthcare costs have risen 9% in the past year, amidst the Republican Party’s promises to repeal and replace the Affordable Care Act, an effort that didn’t make it to a House vote earlier this year.
Pollsters surveyed 1,000 people over the phone between April 6 and 9.
High tuitions and student loans are also a major source of stress with 34% of respondents losing sleep over educational costs.“People lose sleep when things feel out of control,”
http://time.com/money/4749161/americans-insomnia-health-care-insurance-costs/
Just had a “raise” in pay at my employment. The extra money will just cover the increase in cost of our healthcare plan. Obamacare is not working at all. I talked with my Doctors and they tell me no one wants to participate in it. Just another piece of the puzzle of collapse.
Huh. Pron is keeping me awake at night. And mostly day also.
Healthcare year 2024.
http://www.doctorramey.com/wp-content/uploads/2012/03/larson-horses.jpg
Seems to me that veterinary surgeons might put people down more kindly than the industrial medical complex does.
‘Poor old thing, the time’s come, can’t wag your tail, can’t get out of the basket can you? No need to go with this is there, it’s not life is it? Here’s a treat, and here’s something to knock you out.’
And then the fatal dose.
Those are good points. I followed the “Time” links through to a CBS News article, and then back to the articles writing the studies that backed them up.
The CreditCards.com article, besides saying the things that the Time article says, raise the point, “Spending less is key to a good night’s sleep.”. It says, “Of those losing sleep, nearly 2 in 3 (64 percent) said they reduced their expenses to improve their financial situation in the past 12 months.” This pattern would seem to push the economy toward recession.
The CBS Article also links to a Kaiser Family Foundation study. It notes that the affordability of health insurance (ACA and other) has been deteriorating since 2015. Rising premiums and oversize deductibles are big problems. So are rising prescription costs.
‘followed by saving for retirement’
If they’d log on to FW — they could sleep easy — at least on that issue….
I was gonna say, retirement is a no brainer for me. in 10 years time there will be no retirement for me regardless. No one else will have a retirement in 10 years either, even if they save every dime they make. So, I don’t worry about it.
What keeps me up at night is wondering if i will be able to do all the things I wanted to do in life after I retired and do them now. Will I be able to pull it off. I don’t know. But, I am going to try to. I really really want to see the sky at night with zero artificial light. That should be worth the wait if I make it that long to see that I will have lived a full life.
#winning
Chinese iron ore futures are going bananas, surging over 7%
Take a look at the scoreboard with a little under 90 minutes of trade on Friday to explain the shift in sentiment.
SHFE Zinc ¥21,675 , 3.73%
SHFE Nickel ¥79,950 , 1.22%
SHFE Rebar ¥2,996 , 3.52%
DCE Iron Ore ¥512.50 , 7.44%
DCE Coking Coal ¥1,148.50, 6.00%
DCE Coke ¥1,656.00, 6.29%
Read more at https://www.businessinsider.com.au/chinese-iron-ore-futures-are-going-bananas-surging-over-7-2017-4#vPK8GhPKdxvWw83F.99
The PBOC would not have a hidden hand in this…. nah…. no way…. crazy thought….
Once again – this demonstrates that the financial side of this can be papered over…
If the PBOC is involved here — then if I am running money I am looking at that and saying – it makes no sense — the fundamentals are all wrong — yet the prices are rising..
And I am thinking … the PBOC wants them to rise…. and I am saying don’t fight the PBOC…
And I am jumping on for the bull run …. and even if the prices do drop again I know the PBOC has my back…. I will ride it out… and if the PBOC cannot rescue the market for some reason then what does it matter — we are all dead….
Japan should have collapsed long ago — it has not.
I am ever more doubtful that collapse comes as a purely financial incident – rather I am thinking it will be related to a physical event that results in a financial incident that cannot be controlled…
Possibly to do with the fact that big oil is not finding much in the way of new oil reserves that can be extracted… and we are relying on existing reserves….
Exactly FE…The virtual world can hide for a while what is going on in the physical world…but that will take you so far…because at the end of the day, we don’t live in the virtual world but very much in the real world!
Those numbers FE reported look like China is preparing for war even more urgently than usual – not necessarily as a belligerent, just getting ready.
Or a political incident – US debt ceiling? Frexit? Italexit?
“I suspect French savers will rush to the banks to get their Euros out as quickly as they can and it won’t be long until you have capital controls a la Greece where you can only take out 60 Euros a day.”
http://www.news.com.au/world/europe/nightmare-scenario-could-be-looming-as-france-heads-to-polls-on-sunday/news-story/75ffb177c7e23381e04966ebc2464995
I don’t imagine that sort of thing would be allowed…
Recall when Berlusconi and Papandreao both called for referendums…
They quickly disappeared from the scene….
It will be fascinating to see how the power-brokers attempt to manage the political aspect of the worsening ‘psychology of contraction’, as Nicole Foss calls it.
I’m sure that Theresa May’s decision to call a snap election is rooted as much in the knowledge that the economic situation in the UK is going to deteriorate significantly and thus undermine her government’s credibility as it is in her desire to push through a hard Brexit.
https://www.google.co.uk/amp/www.bbc.co.uk/news/amp/39664537
This will end in tears because anyone with integrity has been removed in all the “free west” (-ern countries)
The growth (ponzi) model has reached its zenith.
With luck, and a lot of prayer; the irritant will be neutralised.
Dem pesky wabbits!
Don’t believe the BBC; part of the elite, sadly.
Exactly: multi-year droughts over whole continents leading to true and prolonged dearths on a global basis; volcanoes; significant earthquakes in important centres; real plagues – not the fitful efforts fortunately seen so far.
These will be the tipping points.
I understand that Cape Town’s main reservoir is desperately depleted and of course Sao Paolo nearly found itself without water last year. I dare say it is not long before a major city becomes non-viable due to drought.
Climate change and environmental degradation certainly seem to offer myriad potential black swans even if we somehow manage to continue mitigating diminishing returns with financial parlour tricks.
I agree water is a huge problem. The country of Yemen comes to mind. According to this article, 14.4 million people are without access to safe drinking water or sanitation. This is over half of the population. http://www.bbc.com/news/world-middle-east-34011187
Strange!
A quick, if familiar, observation to start the day courtesy of Bank of America which in the latest overnight note from Michael Hartnett notes that central banks (ECB & BoJ) have bought $1 trillion of financial assets just in the first four months of 2017, which amounts to $3.6 trillion annualized, “the largest CB buying on record.”
http://www.zerohedge.com/news/2017-04-21/why-nothing-matters-central-banks-have-bought-record-1-trillion-assets-2017
http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/04/19/CBs%20chart%201_0.jpg
http://www.zerohedge.com/sites/default/files/images/user5/imageroot/2017/04/19/bofa%20liquidity%20supernova.jpg
“The fear is that asset prices will collapse in these markets causing widespread panic.”
http://www.investopedia.com/news/central-banks-13-trillion-problem/
Right! Asset prices will collapse, and interest rates on debt will rise very high. Mortgage interest rates will rise. We will at least go back at least to the interest rates we would have had without QE. People don’t think that QE did much, but it really did a whole lot.
in ten years when that 3.6 trillion has hit 36 trillion you will realize that money can be printed to infinity by the central banks just like the sun which keeps on shining which tells you something about solar power being part of the answer to our ills
But it can’t print the resources the system needs to keep going, because we live on Infinite E™. So the purchasing power of money declines as resources deplete…
You must not forget universe is infinite and we will become a multiplanetary species by 2025.
http://pbs.twimg.com/media/CV5UzgHW4AAx6xC.jpg
We just need all of this buying under QE to continue, at a fast rate. Of course, at some point the Central Banks end up depleting the supply of bonds/mortgages to buy.
Well if low interest rates persist too long wouldn’t retirement funds, pension plans and insurance companies become insolvent. So, it seems to me the fed is trying to find an interest rate “Golidlocks Zone” that no longer exists.
The man’s a visionary. We are so lucky to have him spear-heading the Mars movement. However, when the self driving rocket gets close to Mars and malfunctions, it might be difficult to sue him.
“It might be difficult to sue him” – Hmmm you might be on to something there!
It is the perfect business venture. Ship all your investors and their families to Mars in half baked space ships (AutoPilot v3 no doubt), they all fail while orbiting mars. All Elon does is say ooops, my bad. No chance of lawsuit. HAHAHA, maybe he isn’t do dumb after all.
The investors’ second cousins and mother-in-laws will file lawsuits.
Ship them off to Mars too!
Boy Wonder is at it again:
From this article: https://www.yahoo.com/finance/news/first-mars-astronauts-may-trapped-143000782.html
“Elon Musk, the founder of the rocket company SpaceX, recently said he planned to send people to Mars by 2022. Boeing has also challenged SpaceX in getting to the red planet. Musk said he was OK with this because all he wanted to do was colonize Mars and protect humanity from self-imposed annihilation or a rogue asteroid.”
I’ll give Elon credit where it’s deserved; he manifests lots of really big stuff. There’s no doubt he’s a visionary.
We can live on Venus.
I am a visionary.
Actually, you are right. With or without Elon’s help we are in the process of turning our planet into a Venus-like sphere.
You really are a visionary.
I knew it. We got Venusian avitars here on OFW. Continued BAU is in the path to create Venus like conditions on Earth. The planetary being the emanates from the active chemical reaction of a mass with an 800degree surface temperature is powerful. The planetary being of Venus is attempting to make Earth into a viable environment for its life form, thru its avitars that promote more burn baby burn and anything to maintain BAU.
The planetary being of the Earth is resisting this effort by eliminating as many “useless eaters” as possible in hope of keeping the temp of the planet low enough to preserve liquid water. Earths life form is a water soluble chemical reaction that will continue as long as there is liquid waster on the planet. It is a waste of the time that we have left to demonize solar power for intermittancy. I think the Sun has been steady at it for billions of years. Nothing intermittant there. Our adaptation may be lacking but who could possible think that we can supply 200Amps of 240Voltb AC to everyone that signs up. Something is going to give.
Humans and probably mammals are toast. Wouldn’t bet against rats but let’s give cockroaches a chance. Bacteria will be great. That’s where we started.
I can just smell those Venusians.
Colonize mars? Come on now!
It appears that oil is off about 8% this week and is back below 50 again.
“Banks may well decide to cut the credit lines of companies they consider risky”:
http://oilprice.com/Energy/Energy-General/Will-Banks-Allow-Another-Slew-Of-Oil-Bankruptcies.html
That is interesting. I read somewhere that Exxon is going to start exploring in Argentina and target tight oil formations. Hope it is profitable! And as rig counts continue to rise here in the US (rig counts lag price drops) we could see a perfect storm brewing here to put more downward pressure on oil as US oil production is expected to surpass a record in August.
Saudi Argentina? Goodness knows they could do with the income, even if it is ultimately a farce enabled by yet another credit bubble. They are in the painful throes of trying to shake off recession:
https://www.google.co.uk/amp/www.aljazeera.com/amp/news/2017/03/unions-lead-mass-protests-buenos-aires-170308010913190.html
I was in Argentina recently. A politically literate country that has experienced many forms of government, a well educated population, and a small population with massive resources.
(not to mention great wine and food, and beautiful women, and fly fishing)
Without the yoke of the IMF and World Bank, it would be in great shape.
The Vulture guys may have even helped with thier greed, making people actually question the Bond Game so prevalent on the planet, where everyone’s bad bets are covered by the local population.
With regards to Argentina I hear a lot of conflicting information. Others have been impressed as you say, whereas some say it is terminally corrupt and broken.
Argentina is one of the countries with oil exports problems. This chart is not very up to date, but gives the general idea.
https://gailtheactuary.files.wordpress.com/2015/07/argentina-oil-production-and-consumption-2014.png
The article seems not to be very certain about how things will turn out.
Gail wrote, “Once the circus leaves town, we are pretty much out of luck.” The band Erasure wrote a song called ‘The Circus’ in 1987, which expressed a similar sentiment, albeit protesting Thatcher’s Britain, I’m sure:
Father worked in industry
Now the work has moved on
And the factory’s gone
See them sell your history
Where once you were strong
And you used to belong
There was once a future
For a working man
There was once a lifetime
For a skillful hand yesterday…
Can’t download the clip, but the lyrics postied are powerful and poetic.
Works direct on youtube
Subway Shuts Hundreds of U.S. Stores
https://www.bloomberg.com/news/articles/2017-04-20/subway-shuts-hundreds-of-u-s-stores-in-historic-retrenchment
Talk about Collapse!
Jared Fogle. . Before his legal troubles he was estimated to be worth around $15 million. Since the beginning of his trial in 2015, he has spent a fortune on lawyers, pay outs and other fees associated with losing a court case
His case was brought to court, and it is known that he paid out at least $1.4 million in compensation to his victims, 14 girls in total. Once we add in his legal fees, then I think it is safe to say he’s pretty much broke. Add in the fact that he had to pay his now ex wife $7 million, roughly half of his 2013 net worth, and I think that is the nail in the coffin of Jared Fogle’s wealth.
http://gazettereview.com/2017/04/jared-fogle-subway-net-worth/
Easy come, easy go….
Subway makes cheap, crapy subs….
At least Subway started out with thousands of stores, so cutting hundreds isn’t terrible, as a percentage.
The Economy operates within the Framework of Capitalism. It’ll continue until it kills everyone. Extinction is the System Result
http://www.beforethecollapse.com/2017/04/19/extinction-is-the-system-result/
A reset will come.
really enjoyed your work cathal what are your thoughts on a cashless society being implemented by the elders sometime in the distant future ?
I received information today: Conquest of Russia has failed. All fifth column agents in Moscow liquidated. Money flows will change very soon.
Prepare accordingly
Hello Cathal!
I have read many of your comments and I was always impressed that you are able to put together coherent line of thought.
You are correct that current system leads to extinction. The essence of it is not really the crony capitalism, but Marxism (nihilism, feminism, LGTB, glorification of multiculturalism, equality, tolerance). It is abomination against nature and nature quickly wipes out anything that goes against its laws. But Marxism is merely a wrecking ball to destroy current world order, so that they can get their new world order.
I checked the link you posted. It says: “Any individual who depends upon the System for his survival will defend it instinctively.” Quite ironic, you are Asian woman pretending to be Irish and appear to be intimate with European man. System considers you to be its soldier and that you will fight for it, for the (false?) orthodoxy of equality. No offense intended, our actions make no difference, at this late stage of the “game”, nobody can really change the outcome. All we can do is to observe and document mass psychology events as they take place. Im glad you find it entertaining.
Is the circus close to closing its doors?
https://www.bloomberg.com/news/articles/2017-04-20/paul-tudor-jones-says-u-s-stocks-should-terrify-janet-yellen
On the one hand it is refreshing to hear such common sense spoken but, on the other, it boggles the mind that anyone could think otherwise. Years of interest rates at their lowest in five millenia, prompting an orgy of buybacks and a huge excess of corporate debt – how could it not end with an unpleasant correction?
Spotted this assessment of the auto subprime bubble in the US with this quote particularly catching my eye:
“The geographical distribution of the 60-day delinquency balance suggests there is a heavy concentration in the Sunbelt states… Interestingly, it appears there may be a correlation of some form with the slowdown in fracking and shale productions in these areas.”
https://seekingalpha.com/article/4063921-u-s-car-loan-industry-set-crash
It is a reasonable article, apart from that quote. I don’t think the sunbelt states and fracking have anything to do with each other. Two ideas that don’t really belong together ended up in the same sentence.
How odd. I must confess I didn’t know what a sunbelt state was. Here is a link to Wiki for anyone similarly ill-informed:
https://en.m.wikipedia.org/wiki/Sun_Belt
Homeless population soars 10% in one year in Indianapolis
http://fox59.com/2017/04/20/homeless-population-on-the-rise-as-mayor-challenges-community-to-curb-issue/
It is getting harder and harder to keep a lid on all of the problems. Problems keep popping up everywhere as we reach limits to growth.
If the issue is to keep industrial civilization going on a fraction of current energy, there might be some small transitional steps to help out. One might be a large (structured/experimental?) increase in homeless shelter, exquisitely designed to be “invisible.” Very carefully structured across disciplines so that they do not create more problems than they solve. It’s an issue for the highest level of “design” sophistication, “management” and collaboration. Same thing might apply to air bnb’s, perhaps. Someone in my community has an air bnb made as a teepee, rented for (maybe) $20/night. Compost toilet too.
Of course, the materials involved would be mostly free.
Deeper into DelusiSTAN../..
True. No one will take perfectly reasonable steps to ease the pressure, since no one believes the pressure will be significant. Or let’s say they won’t take those steps in what I’d think was a timely, smooth way. But it really doesn’t matter. The self organizing system is the one which gets things done (in its own way), and it is always right.
Living in South Florida one is shocked on what has happened in just the last few years.
If you rent, you are being squeezed and housing is less and less affordable to buy.
According to the report, the Miami metro area is the third-least affordable for renters across the country. Los Angeles ranked No. 1, with rents at 47.6 percent of income; San Francisco ranked No. 2, with rents at 46.1 percent of income. The New York area came in at No. 4, with rents at 41.4 percent of income.
The underlying problem: As rents have risen, wages have remained stagnant, said Jack McCabe, an analyst who studies the local real-estate market.
“You can make a pretty good case that, by and large, household incomes here have been flat or declining over the last eight years,” he said about South Florida.
Read more here: http://www.miamiherald.com/news/business/real-estate-news/article71332267.html#storylink=cpy
In Miami-Dade County there’s a battle going on between short term rentals and the government.
A popular means to earn money to afford to live here is to rent out a part or all of your home or property. Of course, the Hotel and tourist industry cries unfair advantage because up to now no local taxes were paid.
Here is the recent lawsuit battle in the courts
The plaintiffs are seeking declaratory and injunctive relief. They’re asking the court to declare vacation rentals legal in suburban areas of Miami, to stop the city from adopting new ordinances against short-term rentals, prevent any legal action against the hosts and to deem unlawful the city commission’s policy of requiring members of the public who speak up to share their personal information.
The local Airbnb battle has reached a boiling point in recent months with the mayors of Miami and Miami Beach speaking out against the platform. Miami Beach has imposed $20,000 fines against violators since March 2016. Last week, Miami-Dade County and Broward County passed tax deals that would allow each county to collect resort taxes — 6 percent in Miami-Dade and 5 percent in Broward — from Airbnb.
Read more here: http://www.miamiherald.com/news/business/article144684814.html#storylink=cpy
By banning airbnb, isn’t the city limiting a source of taxes?
Hotels and Resorts wants it banned, the local government wants restrictions, regulations and TAXES.
So when air bnb sells a service (rents out a place) there is no tax on what they collect? The resorts and hotels have less of a case, it seems. If the city gets at least the same amount of taxes from air bnb as from the hotels (which should be able to stay in business and attract a different clientele?), while benefiting (an increasingly broad spectrum of) property owners?
Artleads, the article links explain it all in more detail, it has been on the local news here lately.
The fact is homeowners are now being FORCED in this cottage industry to cover their cost of living which Rising much faster than their income.
Airbnb is essentially illegal in every city it operates…. just as Uber is…
With respect to airbnb you need a license to operate a guest house/hotel – this is an expensive proposition — this is why many serviced apartments require a one month minimum stay — they do not want to pay for the expensive license. There are also various regulations that must be followed before one can run a guest house.
Likewise with taxis there are higher insurance requirements – licensing and so on — there are also rules that must be followed.
Ten years ago if you just slapping a Taxi light on a private car and started to pick up fares — you would have been prosecuted
Ten years ago if you just put up a sign on your property renting it out as a hotel you would have been prosecuted.
Not now. There have been a few prosecutions of Airbnb hosts and Uber drivers… but for the most part nothing has been done.
One has to wonder if this is because both services help cushion the blow for many as we head towards the end of days….. Have the authorities said – hands off these two types of businesses because they are generating income for significant numbers of people.
I wonder how many of the jobs being created in the US are for Uber drivers and guest house Airbnb operators? Self employed…..
“One has to wonder if this is because both services help cushion the blow for many as we head towards the end of days….. Have the authorities said – hands off these two types of businesses because they are generating income for significant numbers of people.”
Then the “authorities” are very clever in how they disguise the desperate underlying realities. I’ve seen third world examples of where private cars called “robots” pick up people, and even the ones without govt sanctioned licence plates don’t come in for much apparent prosecution. But that’s the third world, where everybody knows they’re poor–no pretense of the Dream life.
FE says: “One has to wonder if this is because both services help cushion the blow for many as we head towards the end of days….. Have the authorities said – hands off these two types of businesses because they are generating income for significant numbers of people.”
Excellent comment FE. It reminds me of an article I read a couple of years ago that is similar to what you are saying. From the article:
“In other words, Uber is not simply the result of clever, 21st century business acumen, but is rather, almost by default, the shrewd adaptation of industrialism and its technological “progress” to the resource shortages of tighter times. Call it an unintentional disguise of industrial civilization’s collapse if you’d like.”
Here’s the full blog entry entitled:
“The Uber Disguise of Industrialism’s Collapse”:
http://fromfilmerstofarmers.com/blog/2015/june/the-uber-disguise-of-industrialisms-collapse/
Excellent site … this is good http://fromfilmerstofarmers.com/blog/2017/april/money-doesnt-grow-on-trees-industrial-scale-renewable-energy-does/#more
I just got back from Brussels. One woman I happened to meet (in an airport) worked in the Danish wind industry. She mentioned that Danish wind subsides are being cut back. It looks like subsides have already been cut for onshore wind.
https://stopthesethings.com/2016/05/01/denmark-slashes-wind-power-subsidies-to-curb-runaway-power-costs/
There is an article about proposed cutting subsidies for offshore wind as well. http://www.offshorewind.biz/2017/01/25/report-denmark-mulling-offshore-wind-subsidies-cut/
I might mention the “Stop these things” site that I linked to above tries to cover wind energy around the world. It is not exactly unbiased, but most commercial sites aren’t either. https://stopthesethings.com/about/
Uber “works” because there are a lot of people who are not earning “enough.” They can drive for Uber, a few hours a week, and help offset the cost of owning their cars. Some work full time for Uber, and earn a meager amount. Also, the company is losing a huge amount of money. They need much higher rates to be profitable, but this would drive away much of the market.
Über was just banned in Denmark. I think the government needs the taxes from regular taxies. But they are so expensive, that I can’t remember the last time I took one.
It is easy to overlook the fact the government needs taxes from many sources to keep its operations going. Lower fares by cutting out taxes don’t really work.
I can see not wanting to hurt the hotel industry (and the taxes it brings in), but powerful industries tend to overdo it, wanting as much as they can get, and even more than is good for them. The regular home owners need help too (reducing government services for them, etc.). And you have to factor in their buying power, and the taxes that provides the city.
But why does the relationship between the powerful hotel folks and the aspiring air bnb folks have to be antagonistic? The latter should have a reduced, affordable tax rate, and it would seem that the more facilities there are the better for taxes? At the same time, are there any efforts to distinguish the hotel services from the air bnb ones? Can each entity be required to carry PR literature for the other? Has anyone looked how they can complement each other in a way that raises the city’s profile and increases, over all, its tax base?
You really haven’t the slightest clue how the business world, economy and world work …
Tra al f789ing la…. why can’t we be friends why can’t we be friends.. imagine there’s no possessions…. we are the world…. koombaya…. all we are saying….
“You really haven’t the slightest clue how the business world, economy and world work”
No. You do. You’re a businessman, and I respect your knowledge enough that I don’t even dream of imposing my ignorance of the insider business issues you discuss, preferring to stick with what I know.
What do I know (and that you obviously don’t)? Planning. I’m not a professional planner like Froggman. I didn’t go to planning school (an extremely good thing!). But I went to the very best art schools in the world. This has given me the sense of connections that most planners lack. The planning profession throughout the world is dysfunctional, to say the very least. They are not able, for instance, to understand the underlying issues of scarcity that FW is all about. They also lack the aesthetic and visual training to see opportunities that are right in front of them.
I’ve been doing my community planning work for 30 years, and have been widely recognized for it. But please don’t expect me to change the world all by myself. I can’t help it if most people (including you) are far behind. I know how community building works. You do not. So please stick to what you know, show a degree of modesty, and don’t make yourself look foolish by confusing business with planning. Planning is a broader, more inclusive subject than business.
‘change the world all by myself’
What would you change if you could?
The way I see it — the only change that would have made a difference was if we had remained living like the animals we are — hunter gatherers.
but if you were not a doomster, what would you do all day long
The article isn’t the clearest, since they don’t begin at the beginning–which is that the business elites of Miami Beach want to protect their stock-in-trade, which comprises the massive tourist industry. If airbnb could afford hotel tax rates (which it can’t) that might make a difference (although the “law” doesn’t account for even that). So if you put all the facts on the table, what serves the short, medium and long-ish term interests of the people within that jurisdiction? I do not see where anyone has asked or answered that question. It’s all about legal rights (a seemingly disingenuous ploy resulting in winners and losers rather than winners and winners). Law seems to serve only a limited role–as a carrot or a stick–but tends, without a proactive approach alongside it–to have little constructive efficacy. If there can’t be a win/win, then whatever serves the interest of the majority (rather than just the elites), as well as what makes the system most effective, is what should be supported.
Thanks for mentioning net energy Cliff. I agree that net energy is the key. Creating an infinite supply of fiat money is not economic growth. People are still working and driving their cars, however. Just because they can create and infinite supply of fiat money and produce oil at less than cost simply means that we are all using oil at less than cost.
he real GDP growth numbers in the U$ are actually zero to negative. The published ones have been fake for years. The real way to measure GDP is by energy used and net energy use has been dropping, not growing. An economy cannot grow if there is no growth in energy use as is becoming obvious with reality in America. It will become even more obvious in the days to come as the infrastructure continues to collapse and the chaos grows. Civil war? Greater Depression? Both? We shall see.
Strong people make great societies and good times.
Good times make people weak, lazy, complacent.
Weak, lazy, people weaken society and suffer bad times.
Bad times create strong people.
Repeat.
http://peakoil.com/consumption/imf-boosts-global-growth-forecast-to-3-5-despite-geopolitical-angst
For whatever reason the world economy is jacking up!
I’m going to go out on a limb here and suggest they are mistaken. Again.
http://static4.businessinsider.com/image/56cd9d646e97c61d008b9408-800-600/screen%20shot%202016-02-24%20at%207.05.40%20am.png
Hahahaha Harry, it’s the same thing with the IEA…go back in time and their forecasts are always wrong…
http://resourceinsights.blogspot.ca/2013/05/will-international-energy-agencys-oil.html
The IMF has a good imagination?
There are some significant parallels between trees and humans re: communities, competition and the never-ending quest for growth….
How do trees live? Do they feel pain or have awareness of their surroundings? Research is now suggesting trees are capable of much more than we have ever known.
In The Hidden Life of Trees, forester Peter Wohlleben puts groundbreaking scientific discoveries into a language everyone can relate to.
In The Hidden Life of Trees, Peter Wohlleben shares his deep love of woods and forests and explains the amazing processes of life, death and regeneration he has observed in the woodland and the amazing scientific processes behind the wonders, of which we are blissfully unaware.
Much like human families, tree parents live together with their children, communicate with them and support them as they grow, sharing nutrients with those who are sick or struggling and creating an ecosystem that mitigates the impact of extremes of heat and cold for the whole group.
As a result of such interactions, trees in a family or community are protected and can live to be very old. In contrast, solitary trees, like street kids, have a tough time of it and in most cases die much earlier than those in a group.
Drawing on groundbreaking new discoveries, Wohlleben presents the science behind the secret and previously unknown lives of trees and their communication abilities; he describes how these discoveries have informed his own practices in the forest around him. As he says, a happy forest is a healthy forest, and he believes that ecofriendly practices not only are economically sustainable but also benefit the health of our planet and the mental and physical health of all who live on Earth.
After a walk through the woods with Wohlleben, you’ll never look at trees the same way again.
http://www.audible.com/pd/Science-Technology/The-Hidden-Life-of-Trees-Audiobook/B01KMNFUIQ
” There is no more clear-cutting, and logs are removed by horse teams, not machines. In one portion of the forest, old trees are leased as living gravestones, where families can bury the ashes of kin. In this way, the forest generates income without murdering trees.”
“Is sprawl so bad?”
Not as bad as ideological purity, I suspect. If the future is some kind of melding of civilization and “wilderness,” there might be an up side to sprawl. You want the infrastructure of civilization and you also want to rescue vanishing wilderness. You get more for your money if you use the sprawl infrastructure as the base for an intentional, overlaid wilderness. This could represent a huge evolutionary leap in human settlement.
https://www.planetizen.com/node/92350/which-most-sprawling-city-world
Gotta be a cue for Rush:
Which, of course, clearly vindicates dear old Prince Charles and his conversations with plants.
Or maybe they are thinking:
‘ How on earth can I get away from this bore?!! No, don’t hug me! If only I weren’t rooted to the spot…’
For decades now, I’ve been saying nice things about Charles–and even once sent him a letter that turned up in the wrong place. Talking to the plants is nothing. It’s when you start talking to doorknobs and spoons that you worry.
But this article takes me way beyond Charles, and questioning the entire role of trees in cities: I posted this in the Land Use section of the NBL forum:
Trees seem to do better in (family) clusters. Lone trees do less well. Street trees form a linear grouping, however. I imagine that the family dynamic in linear grouping is much curtailed. Also, planted urban trees must not have the family essence that occurs in the wild, where there are parent trees and their offspring. A great many urban trees can be planted at the same time, while the surrounding urban pavement might preclude their tree offspring from forming
My personal bug-bear is hedge flails: after a drive with a friend through another county a couple of months ago I almost felt like weeping at what it does to hedgerows, miles of devastation, torn and shattered branches. An old hedge is a beautiful thing.
Having planted a triple thorn hedge this winter, a proper Old English one, I must admit to the odd chat with my young proteges every now and then. ….. 🙂
Hadn’t heard of hedge flails, but looked it up, finally not having a clue why anybody would do these things to hedges!
What I saw was in the winter and merely barbarous to the trees.
The real villains flail hedges much later, timed just so as to destroy nesting birds!
The local authority grass and verge cutting gangs are also fairly enthusiastic wildlife destroyers, although the situation is improving in some places.
Prince Charles, you may be pleased to hear, learnt the art of maintaining hedges the old way using a billhook (which the English used to stick on a long pole to deal with those pesky Scots every now and then – multi-purpose tooling.) Well, he has to fill in his waiting time somehow…..
And then there is this….
A startup’s $1 million flying car is officially rolling out to buyers in 2020:
http://www.businessinsider.com/aeromobil-1-million-flying-car-deliveries-begin-2020-2017-4
Everything will be fine folks….we at OFW have been wrong…things are going great and they’re only going to get better 🙂
Kiwirail to dump electric trains and replace with diesel on North Island main trunk line
http://www.stuff.co.nz/national/politics/87810900/Kiwirail-to-dump-electric-trains-and-replace-with-diesel-on-North-Island-main-trunk-line
Excellent!
“”The doubling up of service facilities, inventory, training and maintenance required with two separate systems on the line adds to the inefficiencies and unreliability,”
And they shouldn’t waste money destroying those sidelined electric trains either. A train museum might buy them.
Hahaha about Timbuk 3’s song “The Future’s so Bright” from wikipedia:
“Pat (the writer of the song) revealed on VH1’s 100 Greatest One-Hit Wonders of the 80s that the meaning of the song was widely misinterpreted as a positive perspective in regard to the near future. Pat somewhat clarified the meaning by stating that it was, contrary to popular belief, a “grim” outlook. While not saying so directly, he hinted at the idea that the bright future was in fact due to impending nuclear holocaust. The “job waiting” after graduation signified the demand for nuclear scientists to facilitate such events. Pat drew upon the multitude of past predictions which transcend several cultures that foreshadow the world ending in the 1980s, along with the nuclear tension at the height of the Cold War to compile the song.”
Plus ça change…
The University of Alaska Anchorage is displaying a professor’s painting that depicts Captain America holding the severed head of President Donald Trump.
http://www.campusreform.org/?ID=9072
“We are all in the gutter, but some of us are looking at the stars.” ― Oscar Wilde
Have you ever read Wilde. If you had you would know that he had a special brand of mockery for people with that ability to use an aphorism impotently and vapidly as you just did.
I imagine in your case your looking up at those twinkly lights with childish wonder and then annoy the rest of us by saying something equally banal stolen from another author you probably haven’t read or fail to understand. You see when Wilde said some of us are looking at the stars he was part of an aesthetic movement that abhorred conventionally of expression. Yet quoting Oscar Wilde is the height of conventional expression when one has nothing to say – something you have proven on this blog already. Sad but we all have our particular faults. Yours just happens to be in the domain of understanding and expressing complex issues.
Nicely put….
“The scientific man does not aim at an immediate result. He does not expect that his ideas will be readily taken up. His work is like that of the planter – for the future. His duty is to lay the foundation for those who are to come, and point the way.”
-Nikola Tesla
Oscar to his caretaker after being placed upon his deathbed: “Either this wallpaper goes, or I do!”
Hungry Venezuelans break into Caracas zoo and eat the animals!
http://www.telegraph.co.uk/news/2016/08/19/hungry-venezuelans-break-into-caracas-zoo-and-butcher-a-horse/