Most people assume that oil prices, and for that matter other energy prices, will rise as we reach limits. This isn’t really the way the system works; oil prices can be expected to fall too low, as we reach limits. Thus, we should not be surprised if the OPEC/Russia agreement to limit oil extraction falls apart, and oil prices fall further. This is the way the “end” is reached, not through high prices.
I recently tried to explain how the energy-economy system works, including the strange way prices fall, rather than rise, as we reach limits, at a recent workshop in Brussels called “New Narratives of Energy and Sustainability.” The talk was part of an “Inspirational Workshop Series” sponsored by the Joint Research Centre of the European Commission.
Figure 1. Empty Schuman room of the Berlaymont European Commission building, shortly after we arrived. Photo shows Mario Giampietro and Vaclav Smil, who were the other speakers at the Inspirational Workshop. Attendees started arriving a few minutes later.
My talk was titled, “Elephants in the Room Regarding Energy and the Economy.” (PDF) In this post, I show my slides and give a bit of commentary.
Slide 2
The question, of course, is how this growth comes to an end.
Slide 3
I have been aided in my approach by the internet and by the insights of many commenters to my blog posts.
Slide 4
We all recognize that our way of visualizing distances must change, when we are dealing with a finite world.
Slide 5
I should note that not all economists have missed the fact that the pricing situation changes, as limits are reached. Aude Illig and Ian Schindler have recently published a paper that concludes, “We find that price feedback cycles which lead to increased production during the growth phase of oil extraction go into reverse in the contraction phase of oil extraction, speeding decline.”
Slide 6
The comments shown in red on Slide 6 reflect a variety of discussions over the last several years. Oil prices in the $50 per barrel range are way too low for producers. They may be high enough to get “oil out of the ground,” but they are not high enough to encourage necessary reinvestment, and they are not high enough to provide the tax revenue that oil exporters depend on.
Slide 7
Most people don’t stop to think about the symmetric nature of the problem. They also don’t realize that the adverse impacts of low oil prices don’t necessarily appear immediately. They can temporarily be hidden by more debt.
Slide 8
There would be no problem if wages were to rise as oil prices rise. Or if there were an easily substitutable source of cheap energy. The problem becomes an affordability problem.
Slide 9
The economists’ choice of the word “demand” is confusing. A person cannot simply demand to buy a car, or demand to go on a vacation trip. The person needs some way to pay for these things.
Slide 10
If researchers don’t examine the situation closely, they miss the nuances.
Slide 11
Slide 12
Many people think that the increasing use of tools can save us, because of the possibility of increased productivity.
Slide 13
Using more tools leads to the need for an increasing amount of debt.
Slide 14
Read this chart from left to right. If we combine increasing quantities of resources, workers, and tools, the output is a growing quantity of goods and services.
Slide 15
Read this chart from right to left. How do we divide up the goods and services produced, among those who produced the products? If we can only use previously produced goods to pay workers and other contributors to the system, we will never have enough. But with the benefit of debt, we can promise some participants “future goods and services,” and thus have enough goods and services to pay everyone.
Slide 16
If we decrease the amount of debt, we have a big problem. Instead of the debt adding to the amount of goods and services produced, the shrinkage acts to decrease the amount of goods and services available for distribution as pay. This is why moving from deficit spending to a balanced budget, or a budget that reduces debt, is so painful.
Slide 17
When I say (resources/population), I mean resources per capita. Falling resources per capita makes it harder to earn an adequate living. Think of farmers trying to subsist on ever-smaller farms. It would become increasingly difficult for them to earn a living, unless there were to be a big improvement in technology.
Or think of a miner who is extracting ore that is gradually dropping from 5% metal, to 2% metal, to 1% metal content, and so on, because the best quality ore is extracted first. The miner needs to work an increasing number of hours to produce the ore needed for 100 kilograms of the metal. The economy is becoming in some sense “worse off,” because the worker is becoming “inefficient” through no fault of his own. The resources needed to provide benefits simply are less available, due to diminishing returns. This problem is sometimes reported as “falling productivity per worker.”
Falling productivity per worker tends to lower wages. And lower wages put downward pressure on commodity prices, because of affordability problems.
Slide 18
The problems that prior civilizations reached before collapse sound in many ways like the problems we are seeing today. We are seeing increased specialization, and falling relative wages of non-elite workers.
Slide 19
We seem to have already gone through a long period of stagflation since the 1970s. The symptoms we are seeing today look as if we are approaching a steep downslope. If we are approaching a crisis stage, it may be much shorter than the 20 to 50 years observed historically. Earlier civilizations (from which these timeframes were observed), did not have electricity or the extensive international trade system we have today.
Slide 20
The period since 1998 seems especially flat for wages for US wage earners, in inflation-adjusted terms. This is the period since energy prices started rising, and since globalization started playing a greater role.
Slide 21
This is a list I made, showing that what looks to be beneficial–adding tools and technology–eventually leads to our downfall. The big problem that occurs is that non-elite workers become too poor to afford the output of the economy. Adding robots to replace workers looks efficient, but leaves many unemployed. Unemployment is even worse than low pay.
Slide 22
We can think of the economy as being a self-organized network of businesses, consumers, and governments. New products are gradually added, and ones that are no longer needed are eliminated. Government regulations change in response to changing business conditions. Debt is especially important for economic growth, because it makes goods affordable for customers, and it enables the use of “tools.” Prices are created almost magically by this networked system, through the interaction between supply and demand (reflecting affordability, among other things).
Slide 23
It is only in recent years that physicists have become increasingly aware of the fact that many types of structures form in the presence of flows of energy. We have known for a long time that plants and animals can grow when conditions are right. The networked economy illustrated on Slide 22 is one of the types of things that can grow and flourish in the presence of energy flows.
Slide 24
This is my view of how an economy, as a dissipative structure, works. “Tools and technology” are at the center. If a person doesn’t think too much about the issues involved, it is easy to assume that tools and technology will allow the economy to grow forever.
There is a potential for problems, both with respect to inputs and waste outputs. Early modelers missed many of these “issues.” M. King Hubbert created a model in which the quantity of energy supply and technology are the only issues of importance. He thus missed the impact of the Waste Output problems at the right. The Waste Outputs lead to falling prices as limited supply nears, and thus lead to a much steeper drop in production than Hubbert’s symmetric model would suggest.
Slide 25
Peak oilers recognized one important point: our use of oil products would at some point have to come to an end. But they did not understand how complex the situation is. Low prices, rather than high, would be the problem. We would see gluts rather than shortages, as we approach limits. Much of the oil that seems to be technologically extractable will really be left in the ground, because of low prices and other problems.
Slide 26
Here, I am getting back to the topic I was originally asked to talk about. What else, besides low energy prices and too much debt, are likely to be problems as we reach limits?
Slide 27
The easy way of modeling the use of wind turbines and solar turbines is to assume that the electricity produced by these devices is equivalent to electricity produced by fossil fuels, or by hydroelectric. Unfortunately, this is not the case.
Slide 28
Trying to integrate solar panels into an electric grid adds a whole new level of complexity to the electrical system. I have only illustrated some of the issues that arise in Slide 28.
The fact that the price system doesn’t work for any fuel is a major impediment to adding more than a very small percentage of intermittent renewables to the electric grid. Intermittent renewables can only be used on the electric grid if they have a 24/7/365 backup supply that can be ramped up and down as needed. Unfortunately, the pricing system does not provide nearly high enough rates for this service. We are now seeing how this works out in practice. South Australia lost its last two coal-fired electricity power plants due to inadequate wholesale electricity prices when it added wind and solar. Now it is experiencing problems with both high electricity prices and too-frequent outages.
Another problem is that new [long distance] transmission makes buying from neighbors optimal, over at the left of Slide 28. This is a new version of the tragedy of the commons. Once long distance lines are available, and a neighbor has a fairly inexpensive supply of electricity, the temptation is to simply buy the neighbor’s electricity, rather than build local electricity generating capacity. The greater demand, without additional supply, then raises electricity prices for all, including the neighbor who originally had the less expensive electricity generation.
Slide 29
It is easy to assume that EROEI (Energy Returned on Energy Invested) or some other popular metric tells us something useful about the cost of integrating intermittent renewables into the electric grid, but this really isn’t the case.
Slide 30
We are now beginning to see what happens in “real life,” as intermittent renewables are added. For example, we can now see the problems South Australia is having with high electricity prices and too many outages as well as the high electricity prices in Germany and Denmark (Slide 29).
Slide 31
Wind and solar are not very helpful as stand-alone devices. Yet this is the way they are modeled. Some researchers have included installation costs, but this still misses the many problems that these devices cause for the electrical system, especially as the share of electricity production by these devices rises.
Slide 33
A networked system works differently than a system that is “user controlled.” It builds itself, and it can collapse, if conditions aren’t right. I have shown the economy as hollow, because there is no way of going backward.
Slide 34
Many people miss the point that the economy must keep growing. In fact, I pointed this out in Slide 2 and gave an additional reason why it must keep growing on Slide 16. As the economy grows, we tend to need more energy. Growing efficiency can only slightly offset this. Thus, as a practical matter, energy per capita needs to stay at least level for an economy to grow.
Slide 35
If energy prices rise, this will tend to squeeze out discretionary spending on other goods and services. If we cannot obtain energy products sufficiently cheaply, the system of economic growth will stop.
Slide 36
The fact that energy prices can, and do, fall below the cost of production is something that has been missed by many modelers. Prices can go down, even when the cost of production plus taxes needed by governments rises!
Slide 37
Wind and solar are part of the category at the top called “renewables.” This category also includes energy from wood and from geothermal. Many people do not realize how small this category is. Hydroelectric is also considered a renewable, but it is not growing in supply in the United States or Europe.
Slide 38
It takes energy to have an intergovernmental organization, such as the European Union. In fact, it takes energy to operate any kind of government. When there is not enough surplus energy to go around, citizens decide that the benefits of belonging to such organizations are less than the costs involved. That is the reason for the Brexit vote, and the reason the question is coming up elsewhere.
Slide 39
The amount of taxes oil-producing countries can collect depends on how high the price of oil is. If the price isn’t high enough, oil-exporting countries generally have to cut back their budgets. Even Saudi Arabia is having difficulty with low oil prices. It has needed to borrow in order to maintain its programs.
Slide 40
Oil prices have been too low for producers since at least mid-2014. It is possible to hide a problem with low prices with increasing debt for a few years, but not indefinitely. The longer the low-price scenario continues, the more likely a collapse in production is. Also, the tendency of international organizations of government to collapse (Slide 38) takes a few years to manifest itself, as does the tendency for civil unrest within oil exporters (Slide 39).
Slide 41
Slide 42
It is easy to miss the point that modeling a piece of the system doesn’t necessarily tell a person very much about the system as a whole.
Slide 43
Once an incorrect understanding of our energy problem becomes firmly entrenched, it becomes very difficult for leaders to understand the real problem.
So the grand total is 259 companies in the oil industry with about $125 billion in debt for the 2015 to 2017 period.
http://www.haynesboone.com/~/media/files/energy_bankruptcy_reports/2017/2017_midstream_report_20170220.ashx
I imagine there will be a bunch more, too.
I’d be prepared to bet that if India’s gasoline consumption had jumped from 4% in 2015-2016 to 14% in 2016-2017, (instead of the other way around) India’s Government would be broadcsting it with the Hallelujah Chorus playing in the background.
http://www.reuters.com/article/us-india-gasoline-kemp-idUSKBN18900W
Here’s a way to test for stupidity.
Present this and ask for a comment.
HIGH PRICED OIL DESTROYS GROWTH
According to the OECD Economics Department and the International Monetary Fund Research Department, a sustained $10 per barrel increase in oil prices from $25 to $35 would result in the OECD as a whole losing 0.4% of GDP in the first and second years of higher prices. http://www.iea.org/textbase/npsum/high_oil04sum.pdf
OIL PRODUCERS NEED $100+ OIL
Steven Kopits from Douglas-Westwood said the productivity of new capital spending has fallen by a factor of five since 2000. “The vast majority of public oil and gas companies require oil prices of over $100 to achieve positive free cash flow under current capex and dividend programmes. Nearly half of the industry needs more than $120,” he said http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/11024845/Oil-and-gas-company-debt-soars-to-danger-levels-to-cover-shortfall-in-cash.html
And THAT is the crux of the problem…To the slow collapsers or to those who do not even know that we are in the middle of a terminal decline which will eventually turn to collapse overnight (love the Hemingway quote which I learned here on OFW: -“How did you go bankrupt?” -Two ways. Gradually, then suddenly.”), is called The Triangle of Doom:
http://www.economic-undertow.com/wp-content/uploads/2014/08/Triangle-of-Doom-090114.png
Everything is getting squeezed hard right now. Everything is in the triangle of doom. What is so amazing is that so few people understand the gravity of what is happening. Even if you show them these kind of charts. It is like pointing to the iceberg hole in the Titanic…and you are ignored as a fool the ship is unsinkable…party on.
“A fool thinks himself to be wise, but a wise man knows himself to be a fool.”
-William Shakespeare
Greg you opened the door wide open for me to pull out this great quote from Shakespeare 🙂
A glut of used big rigs is weighing down trucking companies already mired in a prolonged slump in the freight market.
Many fleets bought scores of new trucks when transportation demand was booming a few years ago. Then U.S. manufacturing activity flagged and import growth slowed as retailers rang up disappointing sales. Freight volumes started stalling out in late 2015, leaving too many trucks competing for cargo.
Large long-haul trucking companies typically run a truck for three to five years, then trade it before the warranty expires. Repair and maintenance costs tend to skyrocket after about 500,000 miles.
Now, trucking companies are trying to trade in vehicles following one of the steepest plunges in used-truck prices since the recession. Some carriers are “upside down” on trucks in their fleets, meaning they owe more on a vehicle than it is worth.
https://www.wsj.com/articles/trucking-industrys-tale-of-woe-too-many-big-rigs-1494581408
This is meaningless information — I saw a lot of people in the mall and in a few restaurants today — therefore everything must be booming!
For once you have made a correct statement, FE!
Yes, all the numbers you report are meaningless. That’s what I believe and I’m sticking to it.
Moreover, I never said that everything was booming. Merely that they haven’t collapsed. Huge difference.
I don’t see collapse either, dolph. Nobody should expect us to see something that isn’t there. If someone sees something that isn’t there, that would cause for concern.
…its called group think, and notable across many blogs, “outsiders” like myself are often called the “T” word for our opion, which may differ to that of the group, for example one person has already made inference to myself and the C.I.A , or “bots”…..very silly.
all this collapse awareness puts me in mind of how a roman might have felt, say around 570 AD–(dont pull me up on the date–i pulled it out of thin air)
he wakes up, looks around, shakes his sleepy missis—and says: ” Hey–guess what, the Roman empire collapsed in the night—now what?”
and she says: “So now you’re Italian, I prefer Italians to Romans anyway. Romans were always away conquering people, Italians stay home and design beautiful clothes and chariots. Now come back to bed.”
it really isn’t going to be like that folks
…define ” Roman Empire” what collapse?
the western part, or the eastern part?
by the 1750 s the old western part had become extremely powerful and had seen the rise of a number of empires….in other words transitions from one monolithic bloc to a number of global competitors…this is what is currently happening, not a collapse.
i WAS being mildly facetious—in trying to make a point. It’s called humour.
The Brit end of the Roman empire collapsed in 410 AD
The Byzantine end in 1453
1000 years difference was the ultimate point, with various collapses in between
there was no Roman empire in the 1700s—dunno where that idea came from
Norman why do you frame every thing in terms of ” collapse “? when in actual fact what you’re actually talking about is a transition
ok ok
so the roman wakes up one morning—wakes his missis and says: “Darlin–the Roman empire transitioned during the night”
Then she says: “Your jokes are terrible–you never get the punchline right—come back to bed”
Norman you know full well that the Roman empire didn’t collapse over night,so it would be impossible for your imaginary roman to wake up one morning to “collapse “
I formally acknowledge that you are trying to wind me up–if so i can play wordball all day (one of my few lifeskills)
if you’re not—imaginary friend help us all
Norman you have a vested interest in propagating your ” collapse ” meme , i believe you have written a book, which you sell for profit???
have you got any solutions to our coming collapse?
lol—profit–i like that.
the return is so miniscule, i would give it away for free if amazon would let me, but the system doesn’t work like that.
I have always written stuff, my training, if one can call it that, was to use minimum words to get maximum meaning—so setting all this down on this subject is the best way i know to put my thoughts in order, strip out the crap and hit the reader with words that can’t be argued with. I see what’s going to happen, and write it down.
Which, as Ive said before, in 2011 I wrote about “a trump” becoming POTUS in 2016. That might be the sideswipe no one was expecting. Like everyone else, I navigate via the rear view mirror.
now Medium have picked up on my stuff
https://medium.com/@End_of_More/our-culture-cannot-evolve-a621d6a4aa96
I don’t get paid for that either, my only interest, vested or unvested, is putting the message out there, sometimes with a dash of humour, usually presenting reality as it is, without rancour or hysteria. Gail started for much the same reason I imagine.
I try to avoid wish science, wish politics and wish economics (and wish religion come to think of it)
If you apply any of those 4 factors to some comments (here or elsewhere), you will find they fit somewhere pretty neatly.
You will also find one or more of the above will pull the rug from under any of the projected ‘solutions’ too, which i find very sad to say.
Do some research and check that for yourself.
Being angry about what i say is the same as shooting the messenger I’m afraid—it doesn’t change the message. Neither does demanding an answer. It’s not the messenger’s job to deliver answers—if it was, he would be unemployed.
I have grandkids,so I don’t say all this lightly. And I truly hope I’m wrong. They think I’m nuts anyway.
another thought re my book
on the opening page it says “the solutions are with you the reader. Like everyone else, we hope the problem will go away”
Mr Cognitive Dissonance offers plenty of solutions – here’s a partial menu:
– god
– prepping
– buying gold
– Elon Musk
– renewable energy
Unfortunately they are not solutions — but they can make people feel better — and people do want to feel better
They do not want to feel that their children/grandkids are soon going to be hunted down and roasted over a fire — then eaten.
That really freaks them out… and it makes the menu very appealing
pm,
Norm has commented numerous times he hopes he is wrong.
Also “solutions” would be nice. But that “solution” would require a cubic mile of oil annually and a new earth to rape and pillage.
Norm has many abilities, but I think he has neither in his back pocket (cant be sure though). So in the case if Norm isnt allmighty, then there are no solutions..
Comments such as: Oh my god…now what have you done?” is about as close as it gets to me being the almighty. My mom used to say that a lot.
don’t think that counts though
Norman,
I noticed you carefully avoided the question of the huge profits from your book. C’mon, admit it: the return on your time invested is already on a par with that for a child labourer sewing footballs in India.
look
when the book is made into a movie
you are all invited to the oscar ceremony
before that—everyone will be dropped off in vegas to win their expenses–then fly on to hollywood with the necessary cash
Norman thanks for your long answer but you pretty much answered my assertion didn’t you…..you’d end up unemployed,erg its in your interest not to offer answers….as for your grand children…I’m inclined to agree with them,after all they are the future,so for their sake i suggest you try a little harder and look at the solution’s in a more objective way instead of dismissing them in a rather glib and off hand way.
i think you miss the subtleties of language and the nuances of meaning
I tried, as much for your sake as anyone else’s.
let’s leave it at that
Norman apologies, but as a Yorkshire man i don’t do subalties
you can’t spell it either
…now,now ..no need to be a bad loser…if this blog wasn’t such a clunky old thing and used a more sophisticated system like Disqus i could go back and and edit my mistake.
however i think this blogs a reflection of legacy thinking, out of touch with technology, ….thats why it can’t offer any solutions.
Look at my list descbing the way technology creates problems. Ultimately, it leads to increasing wage disparity and to collapse. We can make robots to replace human workers, but ultimately this solution fails. It takes human workers to buy the output of the system. Otherwise , commodity prices fall too low (like they are today) and governments have trouble collecting enough taxes. Many countries are reaching this point today, especially oil exporting countries (Venezuela, Nigeria, Mexico, even Sadi Arabia).
Gail … consider….
https://twocent2c2.files.wordpress.com/2015/08/capture-delusion-blog-08-15.png
Our new commenter is permanently gone.
https://img.clipartfest.com/974d8d0615f534d0b9ca50d0e5528163_gravestone-cartoon-1-rip-tombstone-clipart_5000-5000.jpeg
pm – let us see how long you last here before you disappear….
this blog was on my delete list,i was just about to press the button when i thought
‘ no lets have another look’ ….so yes i wont last very long here,maybe a few more days,but heres a challenge why don’t you stop ranting about the end and look at the very positive developments taking place…for example next month Finland is hosting an international conference about the circular economy,why don’t you have a whip-round ,that means collect some money and put Gail on a plane so she can attend?
At the Inspirational Worshop I spoke at, Mario Giampietro talked about how absurd the circular economy really is. Many types of goods cannot be recycled. Fossil fuels, for example, are turned to CO2 and water. They are not useful as fuels again. Food, once it has been eaten, cannot be turned into human food again directly.
There are a few thing like metals and glass and fresh water that can sometimes be recycled. But this takes energy, and it often is more expensive than mining more ore, and using refine the new ore. The net of all of this is that the circular economy is not something that can be accomplished in practice. It makes people feel like they are doing something about the problem. In fact, it does very little.
i take it you won’t be going then?
its interesting he should say such a thing as the EU appears to looking at the whole thing as part of a solution and has produced a number of papers on the subject
my understanding of the circular economy is smart design so you don’t have to recycle as much.
your example about food i find slightly baffling
Why would ctg go — he belongs here…
…its also interesting because part of his research funding at Barcelona comes from the EU
involved with the so called MAGIC programme which hopes to develop;
” quantitative story telling” using PNS as the basis of its approach to help more effective policy implementation.
the whole thing is part of the Horizon 2020 programme.
I doubt very much Mr Giampietro could stand infront of his students and faculty co workers and say ‘ hay lets not bother,theres nothing we can do’
even if he doesn’t believe in a circular economy,so what?
policy makers want a wide range of opinions, after all isn’t that what PNS is about?
I really should refrain myself, but …
It is hard getting funding saying there is nothing to do (that actually will be done).
Of course there is no collapse. The global economy continues to expand.
Collapse is when people in cities such as New York, London, Toronto, Paris, Hong Kong etc… flick the light switch… and the lights do not go on
“Collapse is when people in cities such as New York, London, Toronto, Paris, Hong Kong etc… flick the light switch… and the lights do not go on” – That day is coming before 2030 without the slightest bit of doubt in my mind. I give it 50/50 odds before 2020 too.
The accurate view is, surely, that we are in the middle of a systemic Collapse, as defined by Tainter, while certain industries,regions and cities are experiencing a very real buoyancy.
The two are not mutually exclusive.
One organism is happily swimming in the sea, while another goes sterile and dies. The sea is poisoned, and all will die eventually. But while you are swimming, it’s great……
….its called transition, the “west” has had its day in the sun, the American century is drawing to a close, we are at the beginning of the 4th industrial revolution, be positive and embrace the change.
Sorry, Japan and China are both up to their ears and beyond in debt. China is having problems with coal, and Japan with nuclear. Their cost level is now above Bangladesh and Vietnam. I am afraid you are mistaken.
…we’ll see
There is some attempt to move manufacturing away from China to lower cost Vietnam and Bangladesh. However, massive investments have been poured into China’s manufacturing industry. It would be very costly to move all the manufacturing to Vietnam and Bangladesh. Will it be cost effective? Or, has globalization run its course with China? Either way China’s boom is over.
You are feeling extra delusional today I see
no, just optimistic. ….
could you send me 6 lottery numbers then
Anyone who understands the nature of the situation and the implications …. and remains optimistic… is either delusional — or stoopid.
I’ll give you a break and suggest that you do not understand the nature of the situation or the implications….
And you probably never will.
Norman why on earth would you want 6 lottery numbers?
did you want 6 winning numbers,or any old numbers?
since collapse is upon us what good would it do you?
…oh …i get it, you’ve got an exit strategy?
the intention is to throw a doomparty/orgy (whichever is applicable)
I need a lottery win to pay everybodys airfares to burn the last drops of fossil fuel.
No invitations will be sent to anyone who has had their sense of humour removed or irradiated.
I have never said collapse is upon us, Ive always said it is inevitable. I present the facts, the conclusions are yours to make
nothing inevitable
“be positive and embrace the change” – Hunter gatherer type change…yes.
like the D-Day scene on Omaha Beach, some were strolling around with a smoke, others nearby were being cut to pieces with machine gun fire. quite a picture.
…..not exactly…if anything, more like The Fighting Tameraire by J M W Turner
Senator Joan McCain who spent many years in the Hanoi Hilton during the Vietnam War, said the first to die were the optimists. Your unrealistic optimistic ravings would condemn plenty to an early grave.
Unrealistic expectations that continuously are unfulfilled have some very adverse affects on the human psyche. There are only so many times one can get up from being knocked down before despair is overwhelming.
Unrealistic optimism also leads to a generation of people that expect the world owes them a living. They won’t believe it when tech fails, when food deliveries fail, when the various government departments don’t answer the phone and when the “helpful” police and military, become less than helpful and more the enemy.
What they do find is that there aren’t enough jobs that pay well. In the US, the problem is low-paying jobs. Where there are high minimum wages, the problem is not enough jobs to go around. There is also a lot of debt from attending universities.
PM, there are many people like you, just barged in and put in a few posts and then trying to stir things up and when things get bad for you all, you all leave. I am still waiting for your “circular economy” documents or links. If you ahave nothing better to contribute, please leave. I am a man of few words and I can see through your style of writing.
Circular economy == perpetual motion. Perpetual motion violates the laws of physics. Therefore a circular economy is a physical impossibility. The end, das Ende, el fin.
Hi bandits,
“Senator Joan (sic) McCain… said the first to die were the optimists.”
Nope, it was Vice Admiral James Stockman.
Known as the Stockman Paradox, he went on to say:
“You must never confuse faith that you will prevail in the end… with the discipline to confront the most brutal facts of your current reality…”
In my view, he was wrong about survival being a matter of “faith you will prevail” but absolutely correct about the need for “discipline to confront the most brutal facts of your current reality.”
Cheers.
This time is different…
Surviving the end of BAU — means losing. It means you get to suffer longer – then die horribly
The proper definition of a ‘collapse’ to keep in mind is that it is merely the transition from a higher level of complexity to a lower.
It is not in itself The End. But ours might be….The End.
eg. Rome collapses, and everyone goes to live in villages and fortresses/monasteries, and all the architects, engineers, chariot makers, etc, are out of work for several centuries, and their knowledge/skills base lost.
Slaves still have a job role, however: no need to re-invent themselves or re-train…..
So, things still function, but now only at the lower (in historical cases the lower level on which the complex society was built ) level of complexity which resources and communication networks permit.
What we mostly discuss here is what stage we are at in the multi-stage collapse of our hyper-complex globalised industrial society, a level of complexity never before seen.
That it will happen, in fact is in progress, is a given.
Which leads one to conclude -given all factors now operating, such as extreme resource depletion and environmental degradation and pollution, extreme complexity, an almost total loss of localised production, etc – that we cannot -in most places -transition to any historical lower level.
On the way down, however, some parts of a complex society will still seem to be doing well, and order books and restaurants will be full.
But this is a normal and expected part of the collapse of a hyper-complex system.
Well put Xabier, not that pm got that 🙂
Thank you, ITEOTWAWKI.
….” But ours might be… The End” …haha, the operative word…”might”
A Freudian slip perhaps? you could also say…collapse might not be …The End.
If I think we are going to transition then, what will we transition to? It cannot be a technological transition. It has to be less complex. If it takes technology and complexity to maintain the ability to have (a home, a car, food in stores, roads, electricity, sewer system, water, gas, plumbing etc) then, we will transition away from our life support systems. So, millions must surely perish. There is no “solution” to this.
Norman,or should i call you Norm?the trouble is even if we the readers of your book came up with ideas i don’t think it would impress you,instead you’d come up with some sort of ‘facts’ to tell us not to bother
minor details have been pointed out as incorrect in my book, but no one has come up with anything that changes the overall message.There have been 3 editions–updates to take account of changing circumstances
i don’t like it much either—makes our future unpleasant to say the least
i just present facts as they stand—i dont do alternative ‘facts’ to prove my own opinions either way
what you do with the information offered is your affair. And this is addressed to all doubters and deniers out there, not just pm
The 1st fact we have to live with, is that over 90% of the global transport system is oil fuelled, about
1 bn cars plus ships. planes etc . everything that moves and keeps us alive—literally.
We burn about 25bn barrels of oil a year, but find only 2.5bn barrels of new oil a year to replace it.
EV’s cannot be manufactured or function outside a fossil fuel based environment. Musk knows this.
This makes us energy bankrupt…we are currently surviving by indebting ourselves to a non-existent future.
If that doesn’t concern you. or you are certain that ”they” will fix things…then you don’t have a problem.—but remember what i said about wishes.
Fact 2….we cannot separate energy from politics, though just about every other commenter on this subject seems to. Personally I don’t understand that. All politicians nail their colours to the energy mast–even if they dont realise it.
Our democratic society has run in tandem with the course of the industrial revolution. Before we had surplus energy, all societies were autocratic and despotic by degree and situation. Democracies didn’t exist.
Machinery freed peasants from working the land, and gradually gave everyone in the industrial world a level of prosperity and universal suffrage—again—the dates are checkable should you wish to do so.
Human rights are still an ongoing struggle.
As our energy availability depletes, the rise of extremist “denial politics” is inevitable—again check the current POTUS and his henchpersons If you don’t get it. The same thing is occurring in Europe right now, The two are linked. As living standards decline, scapegoats are sought, and human rights are gradually eroded. When industries/wages are expanding, workers arent interested in rabble rousers.
Problem is, most people are convinced that prosperity is something you vote for—politicians make promises–people vote for the best liar. Confirmation of that is in our faces right now. No fact checking needed. But he is already condemning everything and everyone who disagrees with him. If he had the means, the condemnation would get physical.
But what happens when the energy-support system crashes, and the economy goes into its final tailspin? It cannot be sustained without fossil fuel input. Then you will have widespread civil disorder, and violent government reaction.
ie–martial law with the necessary ”emergency powers”. That’s when your POTUS becomes a dictator, probably of the theofascist variety. If not the current one, then certainly the one who will follow him.
Did I mention physical condemnation? Interesting.
If that doesn’t concern you. or you are certain that ”they” will fix things…then you don’t have a problem.—but remember what i said about wishes. Don’t rely on them.
Money is energy. Democracy is buying votes with stolen money.
Very well said Norman +++++
I agree, Norm speaks for me as well. These kind of topics are not new for many of us here on OFW. It isn’t hard to understand….if one wants to understand. It takes a lot of text books to make modern economics seem like a legit science. But, takes much less logic to realize how foolish the idea of the economics of growth really is.
You remind me of how I feel when I am forced to listen to someone explain to me how Tesla/solar panels/windmills/thorium/prepping/gold and silver…. are going to save the world.
I feel like saying to them ‘you are so f789ing stooopid that I am surprised that you are even able to tie your own shoes’
I can imagine them getting incensed … doubling down on their stoooopidity…. and I lay them out flat with a vicious right hand — then kick them — hard — in the teeth … and walk away…
This is my dream; this is my nightmare. Crawling, slithering, along the edge of a straight razor, and surviving.
The trucks could be dropped in Afghanistan. Cheaper than MOAB.
http://static1.businessinsider.com/image/4f5141a46bb3f79b4a000052/its-not-fake-chevy-really-did-drop-this-car-out-of-a-plane–just-for-fun.jpg
Ebola breaks out again in Africa. This sort of thing is only one reason why people wont be too keen on migration after the collapse.
http://www.bbc.co.uk/news/world-africa-39899406
The World Health Organization (WHO) has declared an Ebola outbreak in the Democratic Republic of Congo.
Of the nine people suspected to have contracted the deadly virus, three died, with one case of Ebola confirmed through tests at the national laboratory in the capital Kinshasa, WHO Congo representative Allarangar Yokouide said in a statement.
People began to get sick on or after 22 April in Bas-Uele province in the country’s far north, he added.
That’s nature’s way of telling humans to stay out of Africa’s ecosystems.
When the number of diseases originating from Africa, and evidence that supports that humans originate from Africa, is taken into consideration, it’s apparent that Africa’s ecosystems have the most effective way of keeping human population in check .
Humans can thrive in Africa but the way other animals do–by occupying an ecological niche–not by pursuing “development.”
Prior to industrialization, I’m not sure outbreaks were an issue.
Most people in Africa, I suspect, are not aware of this. Many black people who feel left out of development efforts think that by kick white settlers out, their economic problems will go away. Black Africans will not abandon development, for obvious reasons, and don’t see the connection between development and disease outbreaks. In fact, I doubt that they see disease outbreaks as an issue.
So what happens next? Unstable used car prices will almost certainly reduce OEM reliance on leases as the implied 3-year depreciation (or residual values, if you prefer) will make them all but completely uneconomical…remember, Americans only care about that monthly payment. Meanwhile, the relative value between used and new cars will tilt heavily in favor of the used market. Thankfully Americans will still be able to buy that Mercedes they require to get back and forth from their minimum wage jobs, while maintaining a monthly payment of $500 or less, but it will just have to have 30,000 miles on it.
Of course, the OEMs of the world won’t admit that their game is over until it’s way too late. So, they’ll keep right on producing new cars to cover a 17-18mm SAAR environment up until the point they face an outright revolt from their dealer networks. At that point, however, dealer inventories will be so high that Detroit will be forced to shutdown for months on end while new car prices are slashed to reduce the massive inventory glut. Tanking new car prices will put even more pressure on used car prices which will mark the beginning of the death spiral that will result in a new round of inevitable auto bankruptcies…but that’s just a hunch.
http://www.zerohedge.com/news/2017-05-12/flood-lease-vehicles-set-wreak-havoc-new-car-sales
The way things are going maybe Trump will decide to drop all the excess lease returns on Syria. Cheaper than Tomahawks
We exist in that rubble. The Aztec Empire conquered its world, strip-mined its future, and turned human populations into fungible objects. Contemporary society too has nowhere else to go: capital has saturated the earth, and outer space is a void. Our world, with the monstrous totality of its stability and order, is relentlessly producing its own destruction. In fantasies of black holes and the wrath of God; in the actuality of an atmosphere flooded with carbon dioxide and a biosphere denuded of all life. We missed the apocalypse while we were waiting for it to take place. Baudrillard writes: “Everything has already become nuclear, faraway, vaporized. The explosion has already occurred.” Capitalism built a corpse-world. Its sun keeps rising every morning, whatever we do, but it’s growing hotter in the sky; poisoning the seas, frizzling farmlands to desert, carrying out Tezcatlipoca’s last act of revenge.
https://theoutline.com/post/1485/how-the-aztecs-predicted-the-apocalypse
When reading about commodity prices https://www.bloomberg.com/view/articles/2017-05-08/commodities-rout-shouldn-t-be-taken-lightly
Or China stocks plunging, or CBs buying government bonds https://www.wsj.com/articles/the-8-9-trillion-question-what-happens-when-central-banks-exit-bond-markets-1494367772
Seems like we should have crashed already. But CBs have printed enough trillions to keep the boat afloat. Now shale is on its last ditch drilling spree https://www.bloomberg.com/news/articles/2017-05-09/shale-drillers-challenging-opec-with-84-billion-spending-spree
To me everything looks to be coming along nicely. The inevitable draws closer
Are you simultaneously a doomer yet continually quote and rely on information from the mainstream?
Do you even see a little bit of a disconnect there?
I have enough information from alternative sources, and my own mind, not to bother with bloomberg or wall street journal anymore. Yes, that’s correct. I ignore them completely, and don’t have to give any of them a cent of my money, or a second of my time.
You, on the other hand, continue to lap up the propaganda like a trained dog.
yes agree, i dont understand why people pay attention to what is obviously a ploy to panic people into buying or selling….its nothing more than clever marketing.
it certainly isnt an indication of the end of the world…
Why pay attention to the MSM?
1/ Scanning the MSM headlines with the Tainter collapse hypothesis in mind often provides a coherent picture in line with that hypothesis, -ie one observes events and trends which are consistent with systemic collapse in a complex society – quite often despite the overt intention of the articles, which is mostly to boost confidence to invest in scams or vote the chosen sock-puppet in.
2/ It also shows what the manipulators of opinion want you to believe, and most importantly what they want to distract attention from: quite useful.
It’s a bit like the German press banging on about a new super-weapon in 1944: clear sign the war was being lost……
Dolph, to me it became clear where we are headed after watching a Al Bartlett lecture again and again.
The only question that is left to me is when.. Following MSM gives only hints about whats going on. Because its so propaganda ridden, it requires some skills to actually piece out what is actually going on when following MSM. But hints nonetheless. Famine here. Commodity prices there. 50% of Canadians and 60% of janks $200 bucks away from personal bankruptcy. All of these are indicators to me how the string is doing and when it will snap. Symptoms on the patient. What the patient tells you himself is Bull.. but the thing he is referring to might actually exist in the place he indicates pain in..
Also thirdly Dolph, for some strange reason I think any meaningful “survival” would be done in communities. A guy alone is weak. Only communities can survive. But how will large populations think after the collapse?? Maybe the MSM gives some hints about how they think everything went to sh-it. Dont know, my personal thinking is so much removed right now from thinking about bank accounts, pensions, and keeping up with the Joneses, so I dont know how the Joneses will think..
Because I have nothing better to do, Im just making lists of skills people would need to know, if any chance of survival was actually in mind. Currently Im on something like close to 100 skills that a community would require to survive without Fossil Fuels. I understand the point of view many have here, thats its futile. But right now its an theoretical problem for me. I have nothing better to do. So just theoretically, how would it be possible to survive? What would a community need for survival? What would they need as skills? I can tell you the list is looooong.. and nobody actally has these skills.. so it will remain theoretical..
So yes Dolph, after a Al Bartlett lecture Im a doomer. After some knowledge about supply chains, Im a instadoomer. And still.. MSM gives me hints of the schedule, and gives me the illusion I could communicate with the Joneses after collapse. But, in the end, well, I have nothing better to do
yup—Bartlett was one of my first intros into all this too
presents it as simple arithmetic that cannot be refuted
I remember seeing that intro pop up many times on google searches ‘The Most Important Video you will ever watch’ …
And I had thought if I clicked it I was going to get a presentation on a penis enlargement device…
So I ignored it…
Then one day I thought — perhaps Madame Fast wouldn’t mind…. so I clicked it…
Life changing.
My introduction was Tainter – lent to me by a hedge fund owner! Oh, the irony. 🙂
It might be useful to study hunter gatherer communities in order to make a useful list…
1. Hunt
2. Gather
3. Don’t have your intestines eaten by the neighbours.
is it ok to covet my neighbour’s ass?
NP if you’re this guy post-collapse then the answer is yes!
http://www.writeups.org/wp-content/uploads/Wez-Mad-Max-Vernon-Wells-d.jpg
…..oh,and Van Kent, i said plan its economy in regards to Finland i didn’t claim it had one,do please read what say more carefully
Yes, Van Kent, the MSM is full of clues if you know what you are looking for: I wish it weren’t as I’d like to be disproved, very much. I’d very much like to be able to work towards the future for a community or worthwhile people.
The problem is how to establish an appropriately skilled community of the future while everyone is fully immersed in earning a,living in the present set-up and with the skills needed today.
‘Transition’ communities even though well-meaning just don’t cut the ice as far as I can see, and ‘permaculture is riddled with bogus courses.
Modern life is very absorbing, distracting and demanding, and the most difficult mental problem is to live in two worlds as it were – BAU and the putative future. -and also acquire the skills, distributed among the population.
A declining complex system tries to force reality into its mould for as long as possible, long past viability -like the Romans forcing people to follow the family trade. It destroys all opposition and new forms for as long as it retains coercive power, and grinds down the individuals and communities who would be the stock of the future.
Quite apart from this, the skills appropriate to lower levels of complexity were quite literally learnt from childhood -one could walk around a village watching adults do things even if you didn’t practice them. That’s a very good way to learn: immersion. But slow, so slow.
And it is supported by the culture.
It defeats me, I just can’t see how to do it here and now. And bear in mind I practice a craft nearly 2,000 years old. I’ve been reduced to planning how to encourage more bird and insect life in my garden, leaving trees that might survive me, the only thing I control -for the time being. Property taxes always grow in societal decline, so that too might evade my reach eventually.
Maybe it could be done in another location, another culture, requiring perhaps the most minimal skill and tool set, and the maximum native wit and intuition/observation to survive.
There are two wats to optimize: (1) skills and time needed now (2) skills and time needed later. It is impossible to do both at the same time.
In the past my work brought me in contact with a lot of historical reenactors. You would be surprised how many people in that subculture know old ways of life and old skills.
Nice post VK…although I don’s see ourselves as Doomers which has connotations of being whack jobs…I see ourselves as realists who through years of reading and using our critical thinking skills have understood the predicament we find ourselves in (of which obviously has no solution), have understood that our Industrial Civilization is tied together by the Financial System and that with globalization and everything running on JIT systems (including our food) when the Financial System fails it is axiomatic that we disappear with it..
why do assume we have no solutions,????
Who said anything about assuming?
We do not assume — we KNOW.
pm,
Once upon a time there was this older gent named Keith. He was being uploaded in to an AI mainframe while building spacesolar with the chinese. Sorry to say Keith nor Elon Musk can not make energy appear from nothing. Too bad.
Also we had this guy who threatened to sew all of us commentators and Gail to huge sums of money if we didnt immediately all of us here believe that shale oil was going to provide big robust growth for the world economy ad infinitum.
Then we had the one guy who was relieved that everything the bible said about end times was coming true.
I think there has been all solutions offered here over the years
BTW, can we have your solutions pm?
Van Kent did you mean sue, as apposed to sew?
the solutions are all around us, the regenerative economy,or circular economy is currently taking form,Finland being the first country in the world to plan its entire economy on such methods.
The Capital Institute has some interesting ideas, so does The Ellen Macarthur Foundation.
you should check them out and stop being so negative,do i assume you are American?
if so i suggest you do what you are famous for and ‘think outsde the box’
So a perpetual motion machine…
Go back to recess with your kddy garten mates … you do not belong here.
pm,
circular economy is never 100%. You can reuse and recycle maybe 80% if lucky, of raw materials within an economy, also in Finland (that economy, and its recycling I know most about, actually). The problem with reuse and recycle comes with building demolitions and the like. Think about building a football stadium and then demolishing it, and then reusing or recycling it all.. sorry, cant be done. And demolishing waste streams are the biggest material streams in society..
But even with an working circular economy, which Finland is not. It has too many waste mass incineration plants to even qualify near any A-class student. Burning waste means the antithesis of reuse and recycle, if wondering. But it all, reuse and recycle, still requires huge amounts of energy..
The key to start understanding all of this is to understand energy. Everything else is a sideshow.
Think of the first oilfields ever. How much energy was used to build it. And how much energy could be used from the oil from the field.
Now think of the Russians building superduper Atlantic drilling platforms. Think how much energy goes in building those. And how much energy is is left for society to use.
Van Kent I’m not entirely sure if you’re up to date on circular economics,its not just about recycling
pm,
oh please do enlighten us mere mortals about regenerative economics. Where solutions are all around.
Van Kent….yes i thought as much…you’re not up to speed are you?
i did give you some references to look up, now be a good chap and spend the rest of the evening / day doing some research.
You see pm, you gave an economy as an example. And an concept of that economy. And in mere happenstance those are very very familiar concepts to me in an economy I know very very well. I think I have been partly responsible for those concepts to be so popular in that economy. By the work I have been doing for decades now.
Now, they might be all too familiar to me, if you think they will solve all our problems..
So please do tell more
a circular economy is just another way of ”taking in each other’s washing’
it doesnt work.
you cannot make/remake anything of commercial use without heat input.
If you can’t understand that, take a junked car–now reuse all its components to produce something else, without heat inpur
Van Kent do you live in Finland?
… and pm probably lives very far from Finland if he really believe they have anything like a circular economy.
DJ you’re obviously another person incapable of reading something, and no i don’t live in Finland, UK actually. …as for Norman he too doesn’t seem to understand the circular economy model…in fact he clearly demonstrates his need to create a barrier to anything which could possibly be a solution.
I explained the circular economy model to you a little while ago, that it cannot function without energy input
Please feel free to correct my explanation
And we have our first member of the Donkey Club… congratulations…
Be sure to bring this with you to the next meeting — it is your contribution to the wall
http://assets.jewson.co.uk/category-images/8188/Main/8188.jpg
pm,
unless retards like us understands circular economy I doubt it will work.
Norman you actually didn’t explain anything, what you did was demonstrate your prejudice against solutions,the trouble with you my friend is you don’t want a solution…you ask your readers to look for them though,and when they find them,go out of your way to trash them as unworkable. …well I’m almost out of energy in my battery so I’ll resume this tomorrow.
When you recharge perhaps you would enthrall us with tales of solutions… think carefully before you post…. be prepared to be humiliated
Knowing Norman’s position — which aligns closely with mine —- you will turn purple holding your breathe waiting for him to suggest solutions….
nobody wishes more than me that there was one
Fast Eddy,i have re-charged, very refreshed, looked out of the window. …absolutely no sign of overnight collapse
as for all this stuff about going purple…well actually i don’t think so,as for solutions,well its obvious Norman and yourself don’t actually want solutions…i suspect your entire negative little world would ‘collapse’ at the very thought.
…its also interesting because part of his research funding at Barcelona comes from the EU
involved with the so called MAGIC programme which hopes to develop;
” quantitative story telling” using PNS as the basis of its approach to help more effective policy implementation.
the whole thing is part of the Horizon 2020 programme.
I doubt very much Mr Giampietro could stand infront of his students and faculty co workers and say ‘ hay lets not bother,theres nothing we can do’
even if he doesn’t believe in a circular economy,so what?
policy makers want a wide range of opinions, after all isn’t that what PNS is about?
Fast Eddy perhaps you could take your brick and knock some sense into DJ as he thinks you lot are “retards”
Glenn wasn’t such a lousy troll, if he even was a troll.
A circular economy == perpetual motion
Van Kent-
I actually enjoy thinking about those things as well while holding the instadoomer view. It is difficult to find good info on it but how did the first settlers manage to survive in Canada for instance.
People land on the shore with what they can carry and hack out a spot of woods. Think of the Lykov family in more recent times. It seems to me that if humans could do that, some could certainly fair out for a time when they have a roof over their head, plenty of tools and good clothing.
How the heck did they do it?
…yes exactly…
And also the Japanese guys in the jungle. Who wouldnt stop the war. Surviving decades as guerrillas.
But mostly it takes generations of skills that was learnt.
I grew up watching my grandma and pa in northern Finland going along with their daily chores. And oh boy did they have skills. But then I also think about all the things they didnt know.. that we now now.. or could do better..
But Im afraid there arent many places with population density so small, that people have time to learn.. if they gotta do it without any sourcebooks, the internet, guides or teachers.
Coming up with everything on the fly is a bit hard. In a hurry. The first colonies to America can vouch for that.
Van Kent-
Thanks for the reply. Yes, coming up with things on the fly would make it virtually impossible. I certainly know from experience from gardening the time it takes to know the soil, planting times, what does well and what does not.
Living by the ocean is a big plus as it provides so much food with far less effort. Just the fact of owning a good row boat and fishing supplies puts us so far ahead of an early settler. I could not imagine how anyone could survive in the plains of Saskatchewan.
Here is another interesting guy that did not have human contact for years and was discovered by loggers from my area.
https://en.wikipedia.org/wiki/Famine_of_1866%E2%80%9368
Causes
Parts of the country had suffered poor harvests in previous years, most notably in 1862. The summer of 1866 was extremely rainy, and staple crops failed widely: potatoes and root vegetables rotted in the fields, and conditions for sowing grain in the autumn were unfavourable. When stored food ran out, thousands took to the roads to beg. The following winter was hard, and spring was late. In Helsinki, the average temperature in May 1867 was +1.8 °C (35.2 °F), about 8 °C (14 °F) below the long-time average and by far the coldest such month in the meteorological record. In many places, lakes and rivers remained frozen until June. After a promisingly warm midsummer, freezing temperatures in early September ravaged crops; as a result, the harvest was about half the average. By the autumn of 1867, people were dying by the thousands.[3]
Plenty of ocean in this area and a lot more fish back then…. — yet when crops failed… they starved….
For starters…. before they landed they were not spending their days clacking away on facebook…buying food in the grocery store… riding around in cars… using electricity… getting fat, weak and soft…
They were hardened individuals….
And if you read some of the many books detailing what life was like…. they were generally on the edge of survival.
But of course preppers think they are up to all of that – and more…. they even come to FW bragging about chopping a bit of wood….
Yet they refuse to try a week unplugged from BAU.
Pioneers would laugh at today’s preppers… they would dismiss them and clowns — way out of their depth
I’m not saying I could personally make it but that there must be some humans among the general population in a good area that could. Our genes are inherited from the very hardened individuals that did.
And Eddy, your week off of BAU is a pointless. It means nothing. A fat slob with a weeks worth of water could do it. But if someone came on here and said they did it you would just say “now do it for a month!” anyway. Just completely pointless.
And btw, I’m not prepper. I don’t keep piles of food, fuel, solar lights or even own a first aid kit. Prepping is for getting through an emergency. This is not an emergency we are facing.
I bring up wood because so many people think that acquiring it is impossible without fossil fuel or draft animals. It is not remotely so and the body responds very quickly to the effort.
That appears to really bother you. If you can’t do it, no point in worrying about it or being bothered that others can.
All I was doing was asking Van Kent his thoughts as to human survival in certain areas when a group of people start with a huge advantage to those from the past; ie a dwelling place with heat and tools.
And FFS, only 20 percent of the population died in the famine you mentioned. The dead must have lived far from shore;-)
I don’t see it as pointless at all.
Yes anyone could survive a week — but the point is to convey to those who think that surviving the end of BAU involves the ability to split and pile some wood.
That is a total joke.
Try splitting wood – washing your clothes by hand — eat only what you grow kill or gather — use no electricity for a week….
Let me know how that works out.
Then imagine having to do that forever — keep in mind that your bullets will run out — there will be violent elements and no police …. all the animals that you might want to eat will be either already killed or have run deep into the forest… disease will be endemic
The survivalist types suggest this will be a great adventure…. but they refuse to try the week challenge.
Because deep down they know it would be hell on earth — and they mask it with bravado regaling us with tales of splitting wood.
Like I said – that is a joke.
You’ll be dead in a month when BAU goes
Image having a home with running water, AC, heat and sewer. Food in the grocery store. A car to drive. Reasonable levels of security. Then, in a month being without any of those things, at the mercy of the elements. No food or water. People fighting over food. And then you come to the understanding that what you thought was normal will never come back. How many people could psychologically make that transition?
FE,
what is your point with the swedish famine?
Poor farmers in a country filled above sustainable density and then a 50% crop failure, and 15% die.
It’s not like they could’ve ordered dronedelivered fishing gear from Amazon.
Those who had gear and lived close to water was among the 85%.
My point is that some have suggested living near the ocean might prevent starvation…
Apparently not.
Fast-
You love to create characters of people. I have said nothing like you ascribe and have given plenty of thought to our plight. I’m under no illusion. I think the thought of not being able to have the modern life you live is so unimaginable to you that you believe anyone who does not feel the exact same way is delusional. No problem. We all deal with this in our own way but washing clothes by hand is not exactly frightening to me.
As for not making it a month, maybe, but it will not be from driving into rocks or jumping off buildings.
Greg, I could not agree more. The phycological implications for the vast majority of people is going to be too much to bear. I expect most of us here have gone through our five stages of grief or some such process and at least will know what the hell is happening.
‘but washing clothes by hand is not exactly frightening to me’
I would have thought that the issue of eating only what you grow, kill or gather would have been more frightening…
It is possible to live in dirty clothes…
“…or jumping off buildings…”
Haha yep that’s me…but I am definitely at the Acceptance phase like most here (like you said) and will obviously be fully aware, like everybody here, of what is going on when it eventually happens…not that that will make it easier, but less of a “deer in the headlight” reaction 🙂
i think we mark the first settlers with our own limitations.
instead we should consider the conditions they left behind in scotland, where the living would have been just as grim—albeit with warmer winters.
but they were very resilient, and with unlimited timber and game ive no doubt the didn’t find it much worse than what they left behind
ITEOTWAWKI-
I’m sorry if I came off as flippant. I truly do respect you and do not judge anyones reactions to this situation; I envy you actually, you have a choice in your conscience that mine does not allow due to my religious beliefs. I know I’m going to face a great struggle about it when the time comes.
Norman, that is a great point about the first settlers. Over the years I’ve found old foundations way to hell in the backwoods here in the middle of nowhere. I’m not sure how many greats to put in front but my granddad from Scotland landed right up the road from me in the 1830’s and hacked out an existence. Many more went way up the mountain to what is called the “Rear”, [NO JOKES!;-)] big difference in weather and land and not near the ocean. Truly mind boggling but I do like to think we still have those genes and some will get the chance to pass them on. [Note to Fast, legend has it we taste terrible!]
I want to apologize to you too Norman. I’ve been unduly harsh towards you and said things I regret. It is probably pretty obvious by now that I’ve got a soft spot for my faith but lashing out is not a very good way to show it.
On a lighter note, I had the great pleasure of being involved with the rescue of two bear cubs the last couple of days. The poor mother was electrocuted on a pole on our land and it was a complete fluke we found them let alone caught them.
Thanks Joebanana!
BTW are many people religious in Atlantic Canada? Here in Quebec most people are either atheists or religion just does play a role at all in their lives (except for the new massive arrival of Muslims in the last 15 years, who, judging by their attire, seem religious).
Many churches have been turned into condo developments because they were completely empty and we have a LOT of churches…..Mark Twain actually had this to say about Montreal when he visited:
” This is the first time I was ever in a city where you couldn’t throw a brick without breaking a church window.”
It shows you how Quebec used to be VERY religious…I don’t think there is another place in the world that went from highly religious to basically no religion whatsoever in such a short span of time….in 1960, churches were full and 10 years later they were empty! Which, as an atheist, fits me perfectly 🙂
I was in Hong Kong recently and religion is still pervasive…
Hongkies are polytheistic… in fact they have too many gods to be able to list them all…. here are some:
Louis Vuitton
Prada
Ferrari
BMW
Mercedes
Gucci
Patek Phillipe
Rolex
Maserati
ITEOTWAWKI
What a question. I’ll give you my honest answer, religion in Atlantic Canada varies from place to place. From the overall western perspective it is probably the top of the bottom one third…make that one sixth.
We have been going through population decline for so long that the average age is very high. Many rural older people go to church and most young people don’t. We don’t have an “in your face” religion here.
I just happen to live in this little bubble area where we have a great parish that I’ve been in my whole life. I’ve got a bunch of great friends, and we have raised all our kids together and gone through life, death and everything else. We have seen virtually no divorce and I’ve had the great blessing of the wonderful priests who have served our parish since I was a kid. Not one bad memory. It is as it should be. I don’t chalk this up to anything other than the grace of God.
But ours is the end of a culture because it pretty much is collapsed here as far as making a living goes. So the idea of travel and that does not appeal to me. I just want to stay here with my friends and family, play our music and experience the love and companionship that is left.
Thanks for the response Joebanana…Well you seem to be happy where you are in your parish which is nice in these trying times for so many…and life is so much shorter than we think…Carpe Diem fellow canuck!
The MSM is useful as follows:
1. Generally if it explains an issue you can usually rule out that explanation as a truth — and understanding that the MSM is trying to herd the sheep in a certain thought direction — you know to head in the other direction if you want to find the truth
2. The information published is not always a complete lie — so it is an amusing game to try to work out which bits are actually accurate
Yes, like Sauron’s world: seeking to create a beautiful order obedient to him, he produced only darkness, sterility, inhabited by cruel and hideous monsters.
I wish these people would stop fingering capitalism as the culprit, though, when it is globalised industrialism, of which of course capitalism is the enabler, that has done us in.
The industrialised Soviet Union did not exactly have a good environmental record (not to mention what it did to corrupt human souls), they were just less efficient. And as we know early humans cut and burnt and killed everything in reach, but could be called capitalists intent on private gain.
Is Asia, above all China, truly capitalist? Of course not. But the industrialisation of Asia was the last step down into the darkness made by our ingenuity, it is so very clear now.
Correction: early humans could NOT be called capitalists, etc.!
The reason capitalism gets hammered here isn’t for what it produces. Rather it is built in direct opposition to the physical laws. Capitalism requires by definition infinite growth. So even if it only produced bunnies and soap bubbles it remains unsustainable.
Remember Finite World?
Of course I understand that, it should be obvious.
But too many young people -in Europe specifically – think that if something called Capitalism is eliminated, they we can save the Earth and all have i-phones.
It is industrialism which is in complete opposition to physical reality.
In fact, it is Man’s tool-making talent which is in opposition to the natural balance when it is given its head.
The only check on it would be very small populations, and a high level of disease and exposure to natural disasters, violence form other humans, etc, leading to repeated booms and busts, as has happened historically.
But essentially containing humanity within narrow bounds.
Alas, we were too inventive, and escaped our holding zone.
“…early humans cut and burnt and killed everything in reach…”
This discussion reminds me of one of my favorite cartoons:
Yeah I agree, that one is a classic. Steve Cutts is really good..he just won an award for this one:
Wow, I hadn’t seen that one before. Thanks for sharing. I live in the Silicon Valley and see examples of people absorbed by their phones on a daily basis. People stopping in shopping aisles, blocking foot traffic; people not looking up from their phones when crossing the street; people ignoring the waitstaff at a restaurant because they’re too busy playing Words with Friends. A few months ago I saw, for the first time, a flash mob appear at a local park. It wasn’t until I caught a glimpse of someone’s cell phone screen that I knew what had caused it. They were all playing Pokemon Go. In their search for some rarefied digital creature they failed to notice the very real creatures that were all around them: ducks, geese, coots, turtles. It’s amazing how plugged in we are – tragic as well. Most people appear to prefer living in a simulacrum.
I love that clip.
Mine too, it’s very well made and so true..and BTW, even if we did find a way to power our economy in a perpetual motion (for example conventional oil being abiotic replenishing itself magically forever), all that would do would be to collapse the biosphere even faster…there was no way to win this game…the day we learned to control fire and thus circumvent the checks and balances imposed by nature it was game over..it took 200 000 years, but we did…let’s give our clever species a big round of applause!
https://s-media-cache-ak0.pinimg.com/originals/de/f3/4c/def34c0223f86efd57a7f52f48fb0707.gif
Tesla employee bus crashes into car, killing off-duty officer in California
https://www.theguardian.com/technology/2017/may/12/tesla-bus-crash-officer-killed-california
Wow…as usual the voices of truth/reason are from outside the establishment……’told you so’ is going to add up to sweet nothing when this ship is scuttled.
‘The notion of a gardened planet managed for “thriving economies foremost in mind” is a radical departure from the environmentalism of the 20th century, such that the Big Greens have marketed a nomenclature to describe the new thinking. They call themselves, variously, “ecomodernists,” “post-modern greens,” “neo-greens” or, simply, the “new environmentalists,” and their goal is the implementation of “eco-pragmatism.” Their most important departure from the old environmentalism is the jettisoning of any concern about the limits to economic and population growth. If human population doubled between 1804 and 1927, and doubled again between 1927 and 1974, and almost doubled again to 7.2 billion today, with the latest forecasts projecting more than 10 billion people by 2100, the New Enviros bid us look to nanotechnology, genetically modified crops and animals, laboratory meat, industrial fish farms, hydroponics, optimized fertilizers and bio-friendly pesticides, geoengineering (mass climate modification), more efficient transportation networks, electric cars, denser cities (with more people efficiently packed in them), unconventional oil deposits, safe nuclear energy, wind and solar arrays, smart grids, advanced recycling, and much else in the techno-arsenal to keep the human species from crashing against the wall of planetary carrying capacity. “There really is no such thing as a human carrying capacity,” writes Erle Ellis, a professor of geography and environmental systems at the University of Maryland, in an op-ed in the New York Times. “We are nothing at all like bacteria in a petri dish…. Our planet’s human-carrying capacity emerges from the capabilities of our social systems and our technologies more than from any environmental limits.”
hmm…yep that green silo is pretty amazing…the future is so bright they have to wear ..blinkers!
Quite incredible: that chap should study the history of human delusions as well as his specialisms.
It’s lamentable: if the young hear that sort of thing from figures of authority at university, of course they will become techno-fantasists.
If implemented at all, these ‘solutions’ represent nothing more than a further over-burdening of the Earth and a fantastic increase in complexity and fragility (thereby falling within Tainter’s thesis).
Increasing the rate of human and animal sacrifices as conditions worsened – the usual solution 3,000 year ago – was no less rational than this sort of thing.
The rather confused prof. should have his attention drawn to the Persian myth of the good Shepherd King:
Every time that humans and their animals grew too numerous, he waggled his magical staff given him by the gods, said a prayer and, lo and behold! the Earth just doubled in size (what the prof. is saying in essence – human ingenuity increases our viable living space, and always will ) and humans and their flocks multiplied and wealth grew.
But after successfully doing this twice, the gods visited the Shepherd King, to warn him that his magic wouldn’t work a third time, that humans were too numerous, that ‘a great Winter’ was coming and a select few should take refuge underground if they hoped to survive at all.
It’s a remarkable myth: a memory of past collapses, or a hint as to the future?
I mean the lyrics of that song being from outside the establishment…the Greens are so far up the backside of BAU that all they can see are the forever bright skies and solar panels of salvation
These cities are illusions of some triumph over Nature’s laws
We’ve seen the iron carcass rust and buildings topple into dust
And as the waters rise, it seems we cling to all the rootless things
The Christian lies, technology, while spirits scream and sing
Oh God I love the world
Well I never said I was a clever man but I know enough to understand
That the endless leaps and forward plans will someday have to cease
You blind yourselves with comfort lies like lightning never strikes you twice
And we laugh at your amazed surprise as the Ark begins to sink
This temple that is built so well to separate us from ourselves
Is a power grown beyond control, a will without a face
And watching from outside I wish that I could wash my hands of this
But we are locked together here, this bittersweet embrace
Oh God I love the world
And if one day the final fire explodes across the whitened sky
I know you’ve said you’d rather die and make it over fast
With courage from your bravest friends, waiting outside for the end
With no bitterness but an innocence that I can’t seem to grasp
I know somehow I will survive – this fury just to stay alive
So drunk with sickness, weak with pain, I can walk the hills one last time
Scarred and smiling, dying slow, I’ll scream to no one left at all
I told you so, I told you so, I told you so . .
WOW!
IMF “suggesting” a 10% tax on all money on deposit in banks throughout Europe:
https://www.armstrongeconomics.com/world-news/taxes/imf-proposed-a-capital-levy-tax-on-money-in-bank-accounts-raise-property-taxes/
Sure way to kill confidence -and hence consumption -and destroy the property market!
The well-connected in Europe would of course escape the tax, as they did in Cyprus when money was seized: with the right connections I am told that not only did you get a warning by insiders, but it was possible to get money out long after capital controls had been introduced. With a little tip to those who made it possible and looked the other way, of course…..
Well we talk about saving the world now, Eddie
It’s our vanity gone mad
She’ll survive us all perfectly well
When we’re all long buried and dead
Clever monkeys with technology
Barely out of the caves and the trees
It’s all vanity, all vanity – we try to have control
It’s all vanity, all vanity ’cause Chaos rules it all
https://www.theverge.com/2017/5/12/15629754/elon-musk-boring-company-tunnels-watch-first-route-la
This guy and his engineers are geniuses! Got to see the video at the link above of a single rail transport through an underground tunnel. Can you say strobing?
There are millions of cars on LA freeways, so are a few travelling underground really going to make much of a difference in traffic counts up top? Might be better to just use as a subway for people only. Get more people on and spend less time loading and offloading cars.
it seems impossible to get away from the notion ofBAU consisting of travelling from A to B and back again
and if someone says maybe BAU can last a little while longer if people and stuff stops going from A to B you insist that it is absolutely necessary more people travels further more often burning more per km.
Exactly.
Musk is a ham actor,reading (poorly) from a confused and illogical script.
We are merely required to gasp: ‘Awesome!’
Or, maybe, Musk can be seen as the Shaman of the Technophiles, giving garbled accounts of the wonders he saw in the modern equivalent of the spirit world – the Bright Mars Future.
We gather round, hear the drum beat, observe the trance and then wait for the words of the gods….. 🙂
Naievity at its zenith. It’s now time you took your cornucopian dreams to a gullible blog.
http://www.reuters.com/article/us-usa-economy-retail-idUSKBN1881OY
“U.S. retail sales increased broadly in April while consumer prices rebounded, pointing to a pickup in economic growth and a gradual rise in inflation that could keep the Federal Reserve on track to raise interest rates next month.
The reports on Friday added to labor market data in suggesting the near stall in economic activity in the first quarter was an anomaly. But a moderation in year-on-year inflation led financial markets to dial down expectations of at least two more rate increases this year.
“The economy picked it up a notch from the slow start earlier this year, but the inflation fires are not burning brightly and this will likely keep the Fed on just a gradual pace for interest rate hikes later this year,” said Chris Rupkey, chief economist at MUFG Union Bank in New York.”
That article supports what Dolph and I have been saying about economic activity in the Dallas Ft. Worth & SF Bay Area respectively, i.e. things are going just fine and I would say heating up in the opposite direction of collapse. Maybe Venezuela and Greece and a few other counties are having trouble, but that’s always the case – there are always some small countries in trouble.
With all due respect I think the whole idea of imminent collapse is overblown. As peak oilers we need to keep our eye on the ball, and that needs to be the question of what is happening to oil. There is still a glut and that’s why oil price is comparatively low to when it was over a hundred a barrel. With reduced incentive exploration has waned, but once supply is once again low enough to shift oil price higher, then incentive will return. When oil price rises will be the test of what can the economy handle. As we can see from the above article the first quarter GDP was a temporary lull and obviously due to other metrics the US economy is revving up. Once the glut is gone, supply will be low, price will rise, and we will see what that does to the economy and oil industry. The peak oil story is not over by any means as we can see oil is still flowing at a huge rate – so let’s keep our shirts on so to speak and simply wait this out a bit to see where it goes.
http://www.zerohedge.com/news/2017-05-12/us-macro-data-crashes-1-year-lows
http://www.zerohedge.com/news/2017-05-12/retail-sales-miss-across-board-grow-slowest-pace-2017
You must remember … the MSM does not exist to publish the truth … it exists to control what you think….
Another who cannot see the big picture.
For the umpteenth time, it IS NOT the amount of oil, it’s the price of oil that’s affecting the economy.
Actually, we need the rapidly growing consumption of cheap energy products of some kind. If energy products are high priced, it is hard to get their consumption to grow rapidly. So high price is a deal-killer.
The thing is that the glut is continuing due to oil companies having to keep production up to cover their costs. Even if they go bankrupt, the banks etc that take over wants to minimize their loss so they also keep on producing.
We need demand to pick up for oil prices to rise. Not from doctors in Dallas but from jobless in Jacksonville. The non-elite is where the bulk of the demand volume comes from. But these people lack jobs so they don’t need to drive that much.
Great article in the Market Mogul today. Extracts:
“Money, as it is known, is no longer. Its value erodes with each passing day. Central banks around the world print money without the necessary reserves to back their currency. This practice is temporarily calming and conveniently called “quantitative easing” as in “easing the pain in a failing economy”…
“Speculation abounds, and global markets move by the mere mention of a possible interest rate change. Evidently, long gone is the gold standard that once instilled confidence in the value of currency…
“According to recent reports, central banks now own an astronomical $25trn of financial assets.
“The concentration of financial assets on such a massive scale in the custody of a few central banks is worrisome, to say the least.
“A repeat of the global financial and economic crisis in 2007/2008 could have devastating consequences for the world economy and in particular the trust in fiat money…
“The ECB is the biggest actor in the balancing act and has committed itself to buying up debt in the form of bonds at a staggering € 80 billion per month. ECB Chairman Mario Draghi calls it the “Economic Bazooka” meaning that the ECB will do whatever it takes to stimulate the economy across Europe and try to keep the stability of the failing Euro…
“The absolute biggest hurdle and global challenge will be the ever-increasing debt situation of most industrialised countries. Even emerging economies are faced with crippling government debt and recently economic powerhouses like Norway and Saudi Arabia, whose economies are dependent on oil, have joined the fray of indebted countries with budget deficits.
“In “out-of-control” debt spirals, such as the United States ($20trn) and Japan ($11trn), interest compounding can have devastating effects as the mountain of debt grows incessantly and can never be paid back. So the solution adopted by many governments and central banks is just to print more money, issue bond “buy-back” programs (ECB, US Treasury and Federal Reserve Bank) and issue perpetual bonds.
“However, this fragile and unsustainable balancing act cannot go on forever.
“Debt forgiveness and nullification will not be easily accepted by countries that enjoy a surplus government budget and the primary reaction by the global financial markets will be a complete collapse of equity values and destabilisation of major currencies around the world.
“A dystopian world will then have to be ready to accept the consequences of a total global economic and financial meltdown that will result in many conflicts and wars across the globe. And it will be ugly.”
http://themarketmogul.com/money-ugly-truth/
But, but, but… Tesla and ya know, other stuff. This guy just doesn’t have the right visionary approach like Elon.
Yeah, we have like…technology.
“Astonishing Numbers”: US Wages Peaked With Boomers Born In 1942
http://www.zerohedge.com/news/2017-05-09/new-study-real-american-wages-peaked-boomers-born-1942
(I always thought boomers started in 1945)
US domestic oil production peaked around the 70s, Up to that point, the USA got all the oil they needed from within their own borders, (they were global swing producer) after that the USA went into oil deficit, having to get oil from external suppliers to meet demand.
1942 to the 70s, (say 25/30 years) takes you to prime working/productive years for anyone born in 42, after that time, workers started having to run faster and faster just to stand still
1974 was the year the Arab producers realised they held all the oil aces and quadrupled the oil price—but they found they’d screwed themselves, so they had to quadruple production to keep themselves solvent–that cancelled out the 4x rise—so back to square one, and everybody thought things were back to normal.
1983 saw the first oil war–they have been going on ever since, and that’s why they will get worse in coming years until there’s no oil left to fight over.
It wasnt apparent at the time, but now ”flat wages” since the 70s has been confirmed. Wage rises need oil surplus rises. Surpluses have been declining since the 70s. Hence no payrises.
Everything tracks back to that ‘peak production’ point.
It forms a very clear pattern of decline for anyone willing to see it.
1974 appears to be peak wages, and energy use.
What a coincidence!
yup
been banging on about that for years—but I didn’t get a Nobel prize for economics
Always the same legend …
The price rise of the first oil shock was “wished” for by the western majors as much as the Arabs (necessary to start Alaska, North Sea, Gulf of Mexico), and pushed by US diplomacy.
Too bad James Akins didn’t talk more (but he did).
You can also check western majors profits evolution after the oil shocks.
And the second oil schock was direct consequence of Iranian revolution.
USA peaked in the early seventies but were importing oil for decades prior to that. That’s why the Arab 1973-4 oil embargo resulted in shortages.
https://www.eia.gov/dnav/pet/hist/LeafHandler.ashx?n=PET&s=MCRIMUS2&f=A
More errors identified in contrarian climate scientists’ temperature estimates
https://www.theguardian.com/environment/climate-consensus-97-per-cent/2017/may/11/more-errors-identified-in-contrarian-climate-scientists-temperature-estimates
Stupid or deceptive?
The Human Ecological Predicament: Wages Of Self-Delusion
https://theoldspeakjournal.wordpress.com/2017/05/09/the-human-ecological-predicament-wages-of-self-delusion/
Oldspeak Journal; Great reading, thanks for link.
‘.. morose misanthrope, with a wanderlust for world affairs and all things real, looking between the headlines for underreported, unsanitized information…’
haha join the outsiders club huh!
Somebody commented in ZH that situation is so bad now that “since Lehman” is not used now but record high, record low and also the word “ever” (lowest ever) or “since data collection began in 19xx”
Everything in nature suffers from diminishing returns. It was effective in 2008 and gradually over time, it becomes less effective until the time it cease to be work. I guess we are very very close to that point now.
Bread and circus for all – the main star – White House / CIA and the political show. Ever think that this will happen when times are great? (boom times)? Hardly.
Have a good weekend !
https://www.youtube.com/watch?v=axiRN5KXXq0
“Audry, the world is not gonna come to an end when there’s so many people making so much money.”
Sounds similar to “The economy won’t collapse because I just went to a restaurant/mall and it was full.” 😉
The world won’t collapse because we still don’t know who won the game of thrones.
Haha I must admit every time I see a trailer of a movie that I really want to see, I always think in the back of my mind that I hope the system holds till the movie comes out so I get to see it…hard to watch a movie with the grid down 🙂
Yes, we should have the grid for at least 15 months more.
Wow you really know your GoT lol:
https://qz.com/747210/hbo-is-letting-game-of-thrones-quit-while-its-ahead-with-a-few-more-shortened-seasons/
Untied States National Academy Sciences (2009)
“Tracking the ecological overshoot of the human economy”
pnas.org/content/99/14/9266.full
Just to clear up the Brexit thing.
I believe there were three key events driving Brexit. Energy depletion may have been a contributory fourth but not the driver.
The first concerns the ratification vote on the UK membership of what was then the EEC in 1974. The British people were assured, not least by PM Edward Heath that joining the EEC was merely a trade treaty and that sovereignty would never be lost. As it turned out the European project was much larger and that failure to be completely open about the aims of the EU sowed the seeds of discontent.
The second event was chancellor Norman Lamonts proposal that the UK should accept the Euro currency. This is the key event behind the formation of UKIP and the rise of Nikel Farage. This clear handing away of UK sovereignty galvanised a political movement dedicated to informing a largely ignorant population about the true nature of the EU.
The final nail in the coffin for the UK membership of the EU came in 2004, four years before the financial crisis. Tony Blairs approach to the accession of the new EU member states was disasterous. In allowing the populations of Eastern Europe the right to access the UK labour market freely, whilst others placed restrictions he triggered a migration that ran and continues to run at a rate of a million people net every three years. Suddenly a new youthful labour force arrived, prepared to work overqualified and undercutting local labour. Suddenly the UK membership of the EU had very visible consequences. Lower wages, rising house prices, public services under strain. That’s what really lead to the leave vote.
Now energy depletion and falling prosperity will have helped the vote along the way. It’s not a good idea for a government to hold a vote during a time of subdued economic growth. Some will have voted just to stick it to the Tory leadership. I for one though don’t believe that was the key driver.
Good post, Trousers. I voted for Brexit primarily because of workers from Eastern Europe coming and competing for fares. I doubt many native taxi drivers voted otherwise. Nothing against Eastern Europeans, I find them far nicer than us barbarian Brits on average, but in a world of rapidly diminishing resources it is insane to allow more people in to our already overcrowded island to compete for those resources.
agreed
I go along with that, there are many nice, hardworking Polish people in our area now, I have nothing against East Europeans. But when in some areas people are complaining the schools are fit to bursting and thei kids are being held back because half the class don’t speak English. And when jobs are only being advertised in Eastern Europe and some large scale employers not to want Brits in their workforce. And when the population is increasing at such a rate in a country that has long been able to build houses rapidly enough… Then you can understand the resentment.
The problem has been the scale and speed of the change. Had the accession of Eastern Europe been handled better, then I expect the remain vote would have triumphed. David Cameron would have used that endorsement to push ahead with more rapid integration, before you know it we would have had the Euro currency and at that point we could begin to say goodbye to Great Britain and hello to the United States of Europe or Greater German Riech depending on your point of view.
Like you I voted leave because I believe if we could do something to slow globalisation and at least try to do something based more on localism in the UK then it would be for the good. Even if that means we may not be as prosperous, for a time than we might otherwise have been.
Are you telling me your immigrants work?
East Europeans and particularly the Poles are very well respected in the UK because of their work ethic.
and romanians are the best car washers you ever saw
Cleveland is full of assimilated polaks, I cant even tell a pole from a german from an englishman by sight. From my perspective it seems comical that anyone could even object to them.
Also, my last house cleaner was romanian, she was great. The american girl I have now is always late, evidently tending to her illegitimate brood….
You could trade immigrants with us. Will solve the wage dumping problem. Could perhaps hurt the taxes, or what you get for the taxes, though.
This book suggests that employers find British workers lazy and expensive… and eastern europeans hard working… http://www.telegraph.co.uk/books/what-to-read/this-is-london-by-ben-judah-review-astonishing-and-valuable/
Yes, that’s the nitty gritty.
Yes, they are, on the whole, great.
Who wants to face a sulky ill-mannered (all too often I’m afraid) Brit in a shop when there is a lovely looking woman from Poland or Slovenia only too happy to be earning a living, smart and professional?
The Polish builders also gave a good kick up the backside to lazy, shifty English builders who had got used to screwing customers in the pre-2008 boom. The builders here retaliated here by reporting the Poles to ‘building control’ for breaches of regulations which hadn’t happened, constant harrassment.
Walk past a building site and what is the usual activity of an English builder? Talking on his mobile.
The Poles I employed were not dirt cheap, about 30% less, but they certainly worked damned hard, which I respect ,working with my hands myself. It was pleasure to serve them good strong coffee in their rare breaks, rather than deal with the usual British ‘So where’s my tea,then? attitude, before even a finger has been lifted.
However, the recruitment of staff from E. Europe by agencies, cutting out locals, is a very big problem and not quite fair.
And the impossibility of dealing with such large population influxes in schools and hospitals is obvious. It has all been handled very badly.
“Walk past a building site and what is the usual activity of an English builder? Talking on his mobile.”
Great for GDP!
Eastern European prostitutes are far cheaper and prettier than their British counterparts, too.
(Sorry Gail, couldn’t resist.)
Somehow…. I don’t find that hard to believe….
according to Gail they will also run out of ‘energy’ ….we’re all doooomed,dooomed i say.
Have you heard of this? https://www.peakprosperity.com/
Enjoy.
….spot on analysis.
http://www.zerohedge.com/news/2017-05-11/why-teslas-solar-roof-just-another-giant-taxpayer-gift-elon-musk
I call BS
Solar tiles must have “issues”. How do they survive heat/cold extremes, expansion/contraction over time, then there are the many hundreds of connections? How about dirt/dust infiltrating every crevice and opening, not to mention insects. Sounds like an electrical disaster. When they fail they must be essentially unrepairable. I would never buy it.
Cult members who have more money than brains will buy these.
i’m holding out for the solar suit, like the ones the GIs wear except for the bullet-proofing. then again, maybe get the bullet-proofing also.
The Producer Price Index, which measures inflation at the wholesale level for goods and services, and thus up the pipeline from the Consumer Price Index, jumped 2.5% in April from a year ago, the steepest increase since February 2012, blowing past consensus expectations of 2.2% (chart by Trading Economics):
http://wolfstreet.com/2017/05/11/fed-gets-another-reason-raise-rates-unravel-qe/
http://wolfstreet.com/wp-content/uploads/2017/05/US-PPI-change-2017-04.png
April figures aren’t out for the UK yet but the Office of National Statistics summarises March:
“Factory gate prices (output prices) rose 3.6% on the year to March 2017… which is the ninth consecutive period of annual price growth.
“Prices for materials and fuels which are paid by UK manufacturers for processing (input prices) rose 17.9% on the year… this is the ninth consecutive period of annual price growth.
“Prices of imported materials and fuels increased 17.1% on the year to March 2017, which is the second consecutive month inflation from imported materials and fuels has been lower than total inputs.”
Worst Restaurant Tailspin since 2009/2010 Crushes Lower End
So another chain restaurant is “preparing” to bite the dust. Ignite Restaurant Group, which operates the Joe’s Crab Shack chain with 113 locations and the Brick House Tavern chain with 25 locations, and used to operate the Romano’s Macaroni Grill chain with 150 locations until it sold it in 2015, is preparing to file for bankruptcy, “people familiar with the matter” told Bloomberg.
In the quarter ended September 26, 2016, the last quarter for which the company bothered to release an earnings report, same-store sales fell 6.8%; total revenues plunged 10% to $120 million.
Industry-wide, same-store foot traffic fell 3.3% in April year-over-year. For the past three months, traffic is down 3.9%. Same-store sales in April fell 1.0% are down 1.8% for the past three months, according to TDn2K’s Restaurant Industry Snapshot.
Food sales and alcohol sales both were down. As traffic dropped, the average check increased 2.3%, less than the rate of inflation.
Q1 had been the fifth quarter in a row of year-over-year sales declines. Now everyone is hoping Q2 will be different. But April’s numbers aren’t auspicious. And no one wants six quarters in a row of this. “The last time the industry experienced a similar period was in 2009 and the first half of 2010,” the March report had pointed out. April has moved the needle further in that direction.
More http://wolfstreet.com/2017/05/12/chain-restaurant-sales-traffic-worst-since-2009-2010/
I don’t believe it – I saw a restaurant that appeared to be full yesterday — all is well!
Hmmm… traffic is down 3%… would anyone notice the drop in traffic???
Again – nobody is saying these restaurants are empty….
Grow or Die.
“Rising household debt load” likely to “suppress consumption, including eating out.”
Restaurants tend to be leading indicators, because that is on place where people can cut back on expenses if they need to. When the cut back, it leads to layoffs in the restaurant sector. Some restaurants close their doors. (The remaining restaurants look quite full.) The laid off workers swell the number of unemployed. This is often a sign of recession not far away.
And when there are not takers for the empty spaces they leave behind… that leads to commercial property bankruptcies
Anything called a ‘Macaroni Grill’ deserves to go bust. Awful! Sorry if that sounds rather European. 🙂
i’m with you on that, and i’m a damn yank.
I remember horrifying a girlfriend from Kentucky by saying I was preparing macaroni cheese for dinner (the English have been making their odd version since the 18th c) .
She was only used to the American fast-food version, which I believe is bright yellow or even orange and tinned?
She survived. 🙂
Did your relationship survive?
I bet he took her “sticking” to cheer her up.
Technician makes shocking call: Expect crude to hit $90
http://www.cnbc.com/2017/05/05/technician-makes-shocking-call-expect-crude-to-hit-90.html
Suppose oil does bounce up to $90 per barrel. It needs to go above that level and stay there (perhaps $100 to $150) and stay there for an extended period. Oil producers need to start collecting an adequate tax level. In fact, because of diminishing returns, it has to keep rising quite a bit faster than people’s wages.
The main thing $90 per barrel oil will do is create recession in oil importers. That is what sends the price back down.
Exactly, oil has to go up and stay up for there to be re-stabilization for oil producers. And that will cause recession. It is a trap. A paradox. A predicament. A conundrum.
Fake News Big Government Data! But you can’t fool everybody forever!
https://srsroccoreport.com/warning-the-coming-collapse-of-u-s-net-worth-will-wipe-out-millions-of-americans/
… and if you buy gold everything will work out splendidly…
Yeah, the old buy silver or gold and be financially secure. That won’t work this time around.
I used to think that was a good idea — until I realized the true nature of our problem…
“It is difficult to get a man to understand something, when his salary depends on his not understanding it.”
I’d suggest a deckchair and popcorn for this one when it blows up.
Are US drivers losing their reputation as gas guzzlers?
https://www.ft.com/content/5fba6a88-34f8-11e7-99bd-13beb0903fa3
(Are they radically changing their buying habits from SUV’S and Trucks to Tesla’s all of a sudden? Or is the Official Economic Data inaccurate?)
Tesla sold just over 3000 cars in the US last month — rule that out.
The problem is … everyone is broke
Snippet from the world of Contemporary art: it’s interesting and informative to watch not the highest, ‘record-breaking’ prices achieved (often completely manipulated by dealers and auction houses with loans and guarantees) but the % of lots sold: in New York, the most important market, this has dropped from 90% sold to 60% – even the people buying this stuff, which is mostly a commodity produced for the art speculation game, are not very enthusiastic now.
The international trade in valuable old books started to decline in mid-2014, and dropped like a stone this year, many dealers reporting next to no sales and ceasing to buy as they are heavily over-stocked with unsaleable books. The book trade centres mostly on the US, and Europe, but embraces Latin America and even Russia and China.
Moneyed people are clearly getting wary, if not perhaps feeling any strain themselves.
Everyone knows which way the wind is blowing……
When the rich stop buying that is a bad sign.
Indeed. The last time this happened in the book world, it was 2005 to 2008. Quite a significant indicator of trouble among the higher income group. It didn’t recover until mid-2010, then started to slow in mid-2014.
Shell Says Russia Oil Must Be Considered for Brent Benchmark.
(Question who does this hurt the most? US or Europe?
https://www.bloomberg.com/news/articles/2017-05-10/shell-says-russia-s-oil-must-be-considered-for-global-benchmark
Putin is now claiming the Arctic oil for Russia! One day ahead of meeting with the US! Looks like Trump just got challenged and he didn’t do anything.
http://www.upi.com/Energy-News/2017/05/10/Russian-researcher-claims-edge-in-Arctic-oil-and-gas/9551494419890/?utm_source=sec&utm_campaign=sl&utm_medium=2
The oil under the Arctic is too expensive to really be drilled and sold. It is not much of a prize.
The former blue-chip stock tumbled as much as 30 percent to 61 Singapore cents on Friday….
https://www.bloomberg.com/news/articles/2017-05-12/noble-group-s-share-collapse-worsens-as-dbs-sees-further-losses
Coal continues to have problems!
German Sun King’s SolarWorld to file for insolvency
http://www.reuters.com/article/us-global-oil-idUSKBN185033?il=0
With AI controlled robots we will get the lunar mines and factories up and running in short order. They will build the mass drivers and solar power satellites. We will have all the energy we need with no icing, no clouds, no shredded birds, etc…
Hal sends greetings.
Saudi Arabia is now selling Saudi Aramco this summer. If this isn’t a sign of the end of the oil age..
http://www.reuters.com/article/us-saudi-aramco-ipo-nyse-idUSKBN1861QZ
I guess SA is no longer profitable. So, sell it.
All Washed Up? Shale Oil and Gas Drowns Out US Gulf of Mexico Shallows
http://www.rigzone.com/news/article.asp?hpf=1&a_id=150076
Right after IEA just warned of Oil Shortages by Summer.
For Some, There’s Never Been a Better Time to Buy Oil
https://www.bloomberg.com/news/articles/2017-05-10/goldman-to-iea-see-oil-bulls-back-on-top-as-cuts-dent-stockpiles
Why Goldman Thinks You Should Go Long On Oil
http://oilprice.com/Energy/Oil-Prices/Why-Goldman-Thinks-You-Should-Go-Long-On-Oil.html
Yeah, and that makes sense, because what goes up comes back down and what goes down goes back up when the glut is over. No glut lasts forever – there’s always a piper to pay and it’s coming soon to a city near you. The question is; how high will it go before the balloon gets popped and the economy shifts lower. I’m telling you right now in the SF Bay Area it’s going nuts! We went down to the East Bay today and traffic is thick and help wanted signs all over the place. The company we do business with is way over booked with orders and that hurts us because it takes longer to get our projects done. This is exactly the opposite of collapse, it’s firing on high. We just booked another two projects just this last week and it only takes us 4 projects to pay the overhead and to have our profit for a year. With the previous projects we’ve contracted for our calendar if full right through to March of next year! Everybody we know has more work than they know what to do with. I haven’t seen it like this for 12 years. We have inlaws coming up to our neck of the woods to look for a retirement home to buy now in addition to the one they already own which just went up to a value over a million bucks with no mortgage. If this is collapse people, bring it on because we are filling the coffers.
Same thing is happening in Toronto …
Everything is clearly awesome!
http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/05/01/20170504_toronto1.jpg
Exactly the same in this UK high-tec ‘growth hub’: construction everywhere; packed mediocre restaurants (one goes to London or deeper into the country for the best ones); more and more fashion stores – insane!
‘They were eating and drinking and giving away in marriage. Then the flood came, and they were swept away.’
Best to enjoy the eating, drinking and whatever takes the place of marriage these days…….
A big cloud of pollution now hangs over this town, and the over-packed 19th c sewers stink, which I find symbolic.
IEA now Warns of Oil Shortages starting Second Quarter (2017) And will be larger by end of year.
http://www.marketwatch.com/story/further-opec-cuts-will-deepen-oil-supply-deficit-in-second-half-of-2017-iea-2017-05-10
Trump is “An Infuriating but Fascinating” Distraction
The President is very much a figurehead – he wields no real power whatsoever. He is apparently chosen by the government, but the qualities he is required to display are not those of leadership but those of finely judged outrage. For this reason the President is always a controversial choice, always an infuriating but fascinating character. His job is not to wield power but to draw attention away from it.
An orange sash is what the President of the Galaxy traditionally wears.
On those criteria Zaphod Beeblebrox is one of the most successful Presidents the Galaxy has ever had.
That is a quote from the novel The Hitchhiker’s Guide to the Galaxy, and it is quite prophetic, right down to the orange sash, though Trump prefers to wear it on his head.
The Distractor in Cheif is clearly meant to take attention away from the actual workings of government and focus it on the silly things he says, the people he fires, Russia, and how rich and elite his family is.
He is outraged all right. And all the focus will stay on that outrage.
He’s even got people to start watching cable again! And when citizens watch cable, citizens are properly programmed.
Trump does it all. He inspires fiery passions in the opposition and his followers alike. He is impossible not to comment on. If you think the government is corrupt, there are 100 examples all referring to Trump, and nothing else.If you want to believe America is great again, just look at the examples Trump has given! Ah but really Americans are ignorant and haughty–just look at the leader they elected! All conversation involving power, the American government, the good, the bad, the corruption, the strength; Trump represents them all, and there is no reason to look elsewhere.
If you want to believe America is great again, just look at the examples Trump has given!Ah but really Americans are ignorant and haughty–just look at the leader they elected! All conversation involving power, the American government, the good, the bad, the corruption, the strength; Trump represents them all, and there is no reason to look elsewhere.
Ah but really Americans are ignorant and haughty–just look at the leader they elected!All conversation involving power, the American government, the good, the bad, the corruption, the strength; Trump represents them all, and there is no reason to look elsewhere.
All conversation involving power, the American government, the good, the bad, the corruption, the strength; Trump represents them all, and there is no reason to look elsewhere. No reason to dig deeper, to research and find the true rivers of power.
Trump is the great and powerful Oz, pay no attention to the man behind the curtain.
Anyone who is capable of getting themselves made President should on no account be allowed to do the job.
The Hitchhiker’s Guide to the Galaxy is a hilarious recap of all the issues with bureaucracy and centralized power. The archetypes of government workers are perfectly displayed as you find out the galaxy is pretty much run just like the Earth… unfortunately.
Sure, the Earth was destroyed to make a galactic bypass just minutes before new technology was created which made bypasses obsolete, but it’s not like we didn’t have a chance to protest!
After all, the plans for the demolition had been on display on Alpha Centauri for 50 years. Humans all had the proper chance at the proper time to petition the government not to destroy the Earth.
What do you mean you’ve never been to Alpha Centauri? For heaven’s sake mankind, it’s only four light years away you know. I’m sorry, but if you can’t be bothered to take an interest in local affairs that’s your own lookout.”
http://www.thedailybell.com/news-analysis/trump-is-an-infuriating-but-fascinating-distraction/
We have some empty niches for statues at my old College: I have always lobbied for putting Douglas Adams up there to commemorate his rather lazy student days and world-wide fame, but for some reason it never happens. If I were a billionaire, I’d pay for one as a gift.
I have followed your blog for years, Gail, and find your analysis to be one of the best in withstanding the test of time as I have studied the Peak Oil phenomenon.
Your observation that low oil prices have become a problem which should have been predictable is true and I believe that this indeed has been predicted by some observers. What I’m getting at is that low oil process are an artifact of deflation. And severe deflation has been long predicted by some (Automatic Earth) as an inevitable outcome of Peak Oil.
Thanks for all your efforts and keep up the good work!
I meant to say..”low oil PRICES….”
This morning on the Today show on NBC. They claimed that 25% of all Millennials were still living with their parents. Then the ignorant host said they did a survey and found the reason out. They said it was because millennials quote “Just love their Mom’s”. And made it totally seem like it was their CHOICE to live at home. I was astonished. And the other day day I saw on CNBC they were saying that new homes sales were slowing down. And it was the Millennials fraught because “They just don’t want to own a home like their parents”. WTF
That is sort of what happened. Men stopped being the one’s to take charge of rasing kids, stopped disciplining them and Mom’s took over, which is why many millenials are snowflakes. They never got tanned so to speak. People are like electricity, they take the the path of least resistance. They stay home to get fed and save money or pay off bills. It’s a different kind of situation today then when baby boomers grew up. The culture is changing.
Oh, my mother hit me about the head regularly. Didn’t do me any harm at all. Character forming. She is still telling me off roundly at 81! 🙂
All of the central banks across the world would step in and provide emergency loans to the banks to keep them propped up as loan defaults would skyrocket and would likely provide emergency funds to the oil companies directly, similar to AIG and GM during the financial crisis, as 0% cost debt and new equity shares in the company. The existing shareholders would likely be wiped out while the creditors of the company might become the new equity owners, though they could take some haircuts as well depending on how bad it got. The central banks would ensure that the operations of the energy companies continue to produce oil, perhaps even taking losses to do so while the industry stabilized and reduced capacity
Oil companies are too big to fail. And it’s not like there won’t still be a ton of demand for oil, even in a recession. In 2009, demand fell to 84.5mm barrels per day, only a 1.5mm barrels per day drop from 2008. If Exxon failed – you would lose over 3mm barrels per day in production. Even in a recession, that could cause a spike in the oil price, though it’s not likely they would ever stop producing as the Fed would step in to provide emergency funding per the aforementioned reasons above.
there is only a ton of demand for Oil at a certain price.
You need to either subsidise the customers to afford higher priced Oil, or subsidise the Oil companies to stay solvent with low prices … either way the system is insolvent
There seems to be a growing belief that energy producers (Exxon, Total, BP etc) can be bailed out by printing money out of thin air (creating debt). I agree that money can be created out of thin air to bail out banks and car companies. But my gut instinct is telling me that this won’t work for bailing out energy producers. Why? Because energy gives money value. That is all I need to know.
That is why I think that IF major energy producers (like Exxon, Total, BP etc) start to go bankrupt that things will fall apart very very quickly. I truly believe that the financial system and energy production go hand in hand and will fail nearly simultaneously.
I feel that the reverse is also true – if the financial system collapses then energy production stops as well. Why? because there is no money to explore for and produce energy products. So, all the energy stays in the ground…forever!
Is my logic flawed?
Interesting thought.
Along those lines then, explain to me the difference between loaning GM or Ford 50 billion dollars to continue to make cars and loaning Exxon or Chevron 50 billion dollars to continue to extract FFs?
From Gail’s analysis the Energy companies go broke because there is a lack of solvent customers for their product. (this is quite different from GM etc needing a bailout from losing market share etc).
Any bailout of the Oil companies doesn’t necessarily address this customer solvency problem (which underneath it all is down to the declining net energy per capita in the system…)
You can distribute free money … but I think they realise it is better to buy stocks and bonds behind the scenes NOW rather than try and rebuild shattered faith later …
Cars are needed for transportation. Energy is needed for everything.
I think you are wrong. Based on the fact you can’t fool investors forever!
I think that massive cash injections will certainly buy the oil producers some time but how much time? When bailouts start to happen for the majors then I would be tempted to convert cash into something useful or tasty with good storage potential because my guess is we would be entering the last year or so of BAU.
Greg
I think your analysis is spot on. Money is not wealth energy is. This is why Wall Street is throwing money at shale. They likely don’t know why but they can’t help themselves. If the majors go down kiss everything goodbye. But it’s foolish to think little zeros on a bank leger can keep a business alive.
The oil industry is facing a triple headwind. Falling EROEI at the well head and falling EROEI at the refinery. And a declining productivity in the economy. Somehow people think these things are unrelated but they corollary.
Economy is created by surpluses. Very simple fact. No surplus no trade no economic activity. Simple stuff 101. So what has the surplus been that has driven the economy for the last 100 years? What happens when that surplus contracts? What happens when that surplus breaks even?
Tesla’s Power Storage Business Grew Dimmer in Latest Quarter
https://www.thestreet.com/story/14130269/1/tesla-s-power-storage-business-grew-dimmer-in-latest-quarter.html?puc=yahoo&cm_ven=YAHOO&yptr=yahoo
Is it me… or does this smack of someone who is struggling to keep a straight face while lying…
Back then Musk said, “the demand has been really crazy, so it’s well in excess of — I mean if you just take the reservations that have been made thus far, it’s well over $1 billion worth of Powerpacks and Powerwalls.”
Musk went on to say “So we’re looking at maybe, again, just to preface with meaningful uncertainty, $40 million to $45 million in stationary storage in Q4 and maybe as much as ten times that number in for next year. So it’s $40 million to $50 million that this year and 10x of that next year. And I mean that growth rate is probably going to just, keep going at quite a nutty level. It’s probably at least a few billion dollars in 2017, somewhat speculative at this point, but I think that’s likely.”
Laugh or cry?
http://www.zerohedge.com/news/2017-05-11/why-teslas-solar-roof-just-another-giant-taxpayer-gift-elon-musk
Athens: Anarchists Attack Business Known for Preying on the Poor
http://dissidentvoice.org/2017/05/athens-anarchists-attack-business-known-for-preying-on-the-poor/
“Things are simple and one target must remain clear: we must protect our homes in any way possible from small and big predators . Participate in solidarity committees, community networks, be present at court. In short, show your solidarity through action and support as many people as possible.
For all the reasons outlined above, we came to the office of Perfect Clean, which we took care of accordingly. Our choice is nothing more than a minimum response of what this company deserves for its role in cases such as the ones described earlier. According to complaints the company is now looking to take advantage of the situation in order to get its hands on the entire building. Against these practices, we say ENOUGH IS ENOUGH! If you have no respect for us, the time has come for you to fear us.”
I would hate if someone came to my desk en messed up the papers like that!
Let me correct a misconception here.
On the question of where are these loans to companies are coming from. They are created out of thin air. They don’t come from anywhere. There is no real ownership or risk anymore, there are just continual increases in debt. Banks do not loan other people’s money. They create the loans themselves!
All financial accounts, everywhere on the planet, are just loans created by banks. Even when you look at your checking/savings/brokerage accounts, all of it is just loans. Your account is credited with the amount it shows.
Therefore, money is never lost in the economy. Think on this. All money is replaced. You guys are still thinking it’s possible to lose money, but that’s only because at your level this is possible. At the systemic level, money is never lost. If this were possible, we would have already underwent a systemic deflation in 2008/2009, which we did not.
You guys are thinking at the shrimp level. Which is fine, most of us are shrimp. But at the big corporate and government level, all money simply arrives out of thin air. Yes, that’s true everywhere on the planet. All you have to do is maintain a favorable exchange relate to the reserve currencies, dollar, euro, or yen (mostly).
The entire global economy is a ponzi scheme of loans that has been going on for some 30 to 40 years. How long can this go on? Probably a few more decades.
“Therefore, money is never lost in the economy”.
Our “misconceptions”…….for pity’s sake Dolph.
I’m not allowed to call you all the things you deserve after making that statement. Suffice to say though, your knowledge of the economy is pretty much crap.
Just a few questions though….
What happens to debt and money when a loan is retired?
What happens when stock prices decline?
What happens when businesses fail or when a bankruptcy occurs?
What happens when assets plummet in value…….your motor vehicle, your computer, your cell phone, lounge suite, solar panels.
Money is lost in the economy constantly but for now it’s replaced with more debt and still functioning (but dissipating) consumer power. Take away the consumer and assets become worthless, as does debt and the money in the economy.
That’s why FE raves on about burning more coal, oil and gas, he understands the importance of spending, it is the only thing supporting the house of cards and a deflationary death spiral.
I agree with you bandits.
“Money is never lost in the economy,” is something that is simply not true. You provide good examples of when money loses value.
Most of us need to keep “earning money” to have enough. We also depend on all kinds of “investments” and government programs (such as Social Security, for the disabled and elderly, and unemployment insurance). We expect that bank accounts that we have will continue to have value.
Unfortunately, none of these things are permanent. Money represents a promise of a government to provide future goods and services. As long as the economy (think of the economy like a big machine), creates more goods and services, then these promises can be kept. But once something goes terribly wrong, the economy stops working.
The way things seem to go terribly wrong is “diminishing returns.” Diminishing returns makes it more difficult to produce enough goods and services for the population. Historically, one major problem has been rising population without the amount of farmland increasing. One way of dealing with the problem is to make smaller farms for individual farmers. It is clear that unless technology keeps improving (more irrigation, more fertilizer, insecticides, herbicides, more productive seeds), it becomes increasingly difficult for farmers to earn an adequate living. They cannot grow enough food both for their own family and to trade with others. This has led to “collapse” in the past. Governments could not collect enough taxes from their impoverished workers (mostly farmers). The downfall could come in many ways (1) spreading epidemics because of the inadequate food supply, (2) loss of wars to neighbors, because the government could not fight back adequately, or (3) other type of government collapse–the Soviet Union failing when oil prices fell too low, or the Eurozone running into difficulty, when unemployment problems grow too high.
A different type of diminishing returns is the need to use more goods and services for getting fossil fuels from the ground (or uranium from the ground, or metals from the ground). This happens because we extract the easiest to extract first. We think of the cost of extraction rising, but what happens is that it becomes more and more difficult to create goods and services. The promises become “hollow promises.”
Another way diminishing returns occurs is through
Another kind of diminishing returns has to do with any k
Hmm dolph, an encouraging theory, but I imagine you have never actually spoken to a seriously wealthy player in this financial game?
You would know that they certainly understand that money – not just tangible assets in their hands – can be lost from the economy: the thought of it dominates their minds.
The obsession with making money and the search for yield is born of that knowledge, not just greed.
One has to stay on the ball, and whole sectors and vast fortunes can be wiped out in an instant, almost. Never to come back, to anyone.
Reading through all the comments that was posted since the article was up a few days ago, here are some of my thoughts. It is different when you read all of them in one go rather than reading it bits and pieces (piecemeal).
DUNNING KRUGER
===============
Humans are not meant to live this way. We are not “designed” to live this way. We don’t have the necessary skills and genetic means to do it. In school, we are taught about rolled-tongue (I am not sure if it is taught in your schools) where some people can do it and some cannot. No matter how much you practise, you cannot roll your tougue. Why am I bringing this up? There are just some people who can see the big picture. The rest just simply cannot see the big picture and understand what is going on. I am sure some of you here the experience of giving an example to illustrate a point but the listener commented on the example rather than the “big picture”. Here is an example :
Norman Pagett says:
May 9, 2017 at 5:41 am
the Titanic/lifeboat analogy fails when you realise there’s no Carpathia arriving tomorrow morning to pick you up and take you home
kulmthestatusquo says:
May 9, 2017 at 8:02 am
Still some people would have escaped, most notoriously the officer who threw empty lifeboat to the sea and forbid poor men from riding them. He escaped with the last of the lifeboats, and because he was a good sailor he would have lived even with no rescue boat.
Some people will be like that. It’s life.
Norman Pagett says:
May 10, 2017 at 5:28 am
erm
i think you missed my point
I have discussions with many people that goes like this – the local government built a new road to ease traffic in one part of the town. Everyone was happy and I was the only one who mentioned that t will cause problems in other parts of town since making new roads will only move the choke point to another part of town. They just stop for a while, think about it and then continue talking about how great that road is and they would not have spent a lot of time on the road now. Guess what, after 6 months, what I say is correct and now, people talked about the jam in other parts of town, totally forgetting what I have mentioned 6 months earlier. It is very surreal, really Matrix-like scene where sometimes, I feel that it is a bug/feature of this entire life simulation.
When you talk about fuel prices and when it went stratospheric in 2007, what do people say? “Guess I have to walk to work then…”. What they don’t see is that FF is the base material for many products and it is not only petrol/gasoline. It impacts everything from tourism to healthcare but what 99.999% of the people will say is that they will cut back on their gasoline use and everything else will be status quo and humming along. I have way past the point of tearing my hair out and say “why can’t you see the implication?” They just cannot understand or believe it. I have come to embrace “Dunning-Kruger Effect”. It is just not worth discussing these types of very abstract, too forward-looking, too big picture scenario with anyone.
The worse is the academics where they think “they know all and they are the best”. This type of scenario is identical to times of Copernicus and Galileo. Do you think we have progressed very far? No at all.
So, instead of I thinking that people are “not clever”, I have a different approach – they simply do not understand what you are talking about. They do not have the capability to look beyond what they can see in front of them. They cannot see the big picture. They cannot see the next few steps. They cannot grasp the big picture.
To me, if you are not educated, it is unlikely that you will be “aware”. Educated as in literate, can read and write. If you are illiterate, then it is likely that you will spend all your days working to survive. I am 100% sure that those who are here on OFW are the top1% of the world (not USA) where you can have the time to think and write. You have access to internet and you are interested to find out more about the big picture. You have a genetic mutation that allows your brain to wonder far and wide. It enables you to see the big picture and to understand the whole scenario. You can understand the severity of the problem.
To me, those with the genetic mutation, it is probably 0.000001% of the world population. They are all here. The only person that I think is not here is probably David Korowicz. He knows what is happening and he may be here under an assumed name. The “Elders”, “elites”, “TBTF” – they have been so rich for so long that they do not understand. They lost the capability to think because they have been so rich. They know something is wrong and they want to make a buck out of this (like global warming, carbon credits, etc) but they don’t know that that it is ELE. If they know, they would not have let Fukushima happen. Radiation from Fukushima is now everywhere in the world. It is getting worse every day and I can say that in my body, I have a few hot particles and even if I don’t die in ELE, I will be down with cancer very soon. I don’t have to wait for the spent fuel ponds. I already have the time bomb ticking in my body.
PLANNING
=========
Millions of years ago in the plains of Africa, early humans, like all animals do not need to plan ahead. They don’t have to decide what or where to eat for lunch. Life is short, brutal and cruel and the value of a human life is the same as an animal. It is either they eat you and you eat them. We do not have the ability and capability to plan ahead. Humans are reactionary and will only act when the need arises. We do not do things proactively. Only a very small fraction of humans does things pro-actively. That is why most of the companies, after some time, will have bad customer services. All the old towns have no planning. It is not because they don’t have any knowledge, it is just that nobody cares and “why bother?”. Everything that humans do are reactionary. That is the law of nature that governs human nature until the arrival of FF. We don’t do anything until we see it. We don’t worry about the volcano erupting until it erupted. We just have to make sure that we have food in front of us and we will take care of whatever happens later on when it happens.
Therefore, since we don’t really have the need to do any planning in our “natural habitat”. There is no need for them to look “at the big picture”. You can say that it is “never in our genes” to think beyond. When the industrial civilization becomes mainstream, together with globalization, planning becomes important and we introduce models to help us predict the future. However, due to our “limited planning capability”, our models are very imperfect and it is wrong most of the time. We do a lot of assumptions as the actual world is very complex. In economics, it is always “ceteris paribus” or “with other conditions remaining the same.” In physics, it is always “assume there is no friction”, in business, it is always assuming “no competitor reaction”. In every subject, you have the basic assumptions. Yes, many will say that this is for teaching high school but to me (again looking at the big picture that many people find it hard to comprehend), it just shows that our real physical world is much more complex than that we can assume. You can design house with an architect and engineer but at the end, you still need to go to the site and take the real world measurement instead of the calculated version. Why? Because, in the real physical world, there are so many other factors that will throw in the monkey wrench to your bright ideas.
Do remember that without the invention of language/writing, all these would not have happen. We can get along very well with hand signs and grunts/signs/non-vocal sounds during the hunter gatherer’s time
WHY RESTAURANTS/MALLS ARE FULL
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The main reason why they are full is because those who are left out are not there. We mix with those who are of the same level (plus/minus) a few notch up and down. The Senior VP will not have any friends who are janitors or technicians. Very likely, the Senior VP’s relatives are also successful and so are his neighbours. Same goes for the janitor, they will not have somebody as friends who are senior managers or VPs. So, how would the VP knows that the bottom rung has fell out? The restaurants/malls that he frequents are those great ones and filled with people. The poor ones do not even have the money to eat out or even come close to the restaurant/mall; they will be chased away by the management. Count and see how many restaurants there are as compared to population. It is only a tiny fraction of the local population. Count and see how many malls are there in your area and compare with the total population. Again, it is a small fraction. Chances are high that you, dear OFW reader are successful in life and stay in a good area, have enough money to spend on luxuries in life (that is if you choose to spend it). If you go to bad part of the neighbourhood, you will find out the real situation. If the statistics shows that >40% of the Americans are one pay cheque away from disaster, then why all the restaurants are full? Because those with one paycheque to disaster cannot afford to go even near to the restaurants that serve wine and good food. The number of people who are laid off are from bottoms up. The top people are usually still working.
Secondly, the people at the mall or restaurant may be the types who are “keeping up with the Joneses”. They may have a lot of debts and they just spend and spend. At the end, you cannot just use the fact that restaurants and malls are full to determine the health of the economy because the main and big part of the main-street economy is hidden from view.
By the way – it is the same everywhere in the world. Tokyo, Bangkok and even my country (home town), the restaurants are full and they drive flashy cars. The mid tier restaurants are also full because the upper middle class may downgrade a little to mid tier restaurant and the cheap restaurants are also full because the mid-tier people are going out to cheap restaurants. The lowest rung of the social ladder are at home cooking. That lowest rung is getting very big in many countries.
WHY WE CAN KILL OFF 99% OF THE POPULATION AND EVERYTHING IS STILL OK
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This is the favourite viewpoint of kulmthestatusquo and some other people before him/her. It is either he does not have any knowledge on manufacturing or does not have the capability to look at the big picture. I am assuming that he is using his brain to do deep thinking though. If he does not use his brain to do deep analysis, then he is probably a troll.
First, your viewpoint is very US-centric and everything revolves around US and the countries outside US will always supply US with whatever it need. You think that what happens outside US is not important and will not impact USA and you will continue to get the parts for your planes where 99% of the population is either slaves or dead. Where everything is robots and AI.
1. Robots and AI needs a lot of raw materials, exotic engineering and long supply chain to function (I am engineering by training). Don’t talk about robots doing the mining. It takes a lot of money and effort to do that. Mining rare earth is a human task in China and I am guarantee you that they are not going to sell you any rare earth if the conditions are not right (i.e. trade war or war). No rare earth, no electronics. Don’t argue with me on this. I am in the electronic industry long enough to know a lot more on this matter than you do. If you are an engineer by training, you will not even talk about robots and AI. It is those who are not familiar with science that will believe that Robots and AI will save us. I worked with robots all my career and they are as stupid as the person programming it.
2. Factories are designed for economies of scale. You cannot produce anything in small quantities because of how the factories are built. You need the entire world’s market to produce the gadgets (phones, etc), equipment (medical, communications, etc), transport. You cannot produce 1,000,000 iPhones per year to justify the cost of development and production. I know you are going to say – well, iPhones is not really required (I expect you say that). I mean all products from refinery (large diameter pipes), to making toothbrush, clothes, pens, paper, etc. Everything is geared for mass market. No mass market, no factories, no production. Don’t argue with me on this. I worked in an electronics factory for more than 20 years. If you have worked in a factory, you will know how critical the supply chain is and that you need to fire up a large furnace to bake the chips whether you are making 1,000,000 per month of 10,000 per month. When the heating element blows, you need to get one from Germany and if Germany is not around anymore, you will never get a replacement. Forget about “local sourcing”. You will never know how to make a heating element that you need because you don’t know the material (could be exotic) and the design. It can look simple but you don’t have time to repair it. USSR has mainly old analog equipment that you can easily replace but not the modern electronic/digital version. Don’t argue with me on this unless you have experience and you are an qualified engineer.
3. As what Gail says, who is going to do the toilets, planting the vegetables and harvesting. Don’t give me the crap of Robots and AI. Do we have it now? Do you know how a robot can plant vegetables? Do the robots and AI know when to harvest. Don’t give me the crap “John Deere automated wheat harvest”. Who is going to repair them? Who is going to manufacture them? Who is going to make the seal or gasket that goes into engines? If those seals are made in China or Japan, how you are going to get it from them.
4. If the toilets are not cleaned, the people working in the office/factory will not work. Do no believe me, try it in your home and tell me if you can work if the toilets are not cleaned and it stinks. Do you think forcing the slaves to clean for you will work? No exactly because many of them will be dead or half starving. Do you think you can be fat and plumb and the slaves are thin (like in olden days?) No, they outnumber you by a big margin. When people have nothing to lose, they will do things that you don’t imagine they will do. Will the police cooperate? Yes initially but they still need to take care of their family and possibly their extended family. You know, husband will say I need to take care of my brother and the wife says she needs to take care of her sister and as it spreads, do they have the resource to take care of all ? If the husband kills others to ensure that the elites are protected, do you think his family is safe? This is what I mean by “ceteris paribus” or assumptions that one may when it is used to protect the elites and 99% of the population is dead.
5. So, is the nurse considered an elite or the hospital attendant? Without the nurse, do you have healthcare? How about the medication and the equipment? Who is making the medication? Robots? Come one … How about the electricity for the hospital? Where does the copper wire comes from? Who is going to wind it on the transformer? In USA or in Vietnam? China? Robots? Come on…. Coming back to the nurse? How do you select which nurse is good and gets protected? When the nurse dies, who is going to replace her? Train her? Schools?
6. Can you see the long chain that requires all the people in the world to make it function? If 80% of the population dies, everyone dies. They may be “useless eaters” to you but they are the ones who will buy the 15m iPhones, the 200m Happy Meals, clean the toilets and pick the fruits or do the work that is totally invisible to you. They are the ones who will mine the rare earth, wind the copper cables around the motor, transport the food, etc. Without all these, you will not be here.
GLOBAL WARMING
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Humans are extraordinary arrogant. They think they know everything. They dig up ice cores and had a small glimpse of the past and make brave, new projects. Extraordinary claims requires extraordinary evidence. I quote Gerald Celante on his Fb posting on 3rd July 2012 – On Global warming: I’m against carbon tax racket. As see it, u can’t pump trillions of tons of toxins into the air w/out harmful results. This is exactly what I have in mind. In any systems, if we pumped in large amount of external or foreign materials in large quantities, we cannot expect that everything remains the same. It can take ages before the effect comes in.
Yes CO2 may be higher in the past but is it that fast? 100 years is literally one nanosecond in earth lifespan. The dimming of the sun has been on-going for millions of years. Does it really matter if the sun dims and we pumped in a lot of toxins? Do we even know what will happen? We are so brave to agree/disagree if humans cause global warming.
For me, it is very simple, there is now way one can maintain status quo if you pump in a lot of external factors especially if it is done so short period of time. I am 100% confident that in 100 years from now, the earth we know today will not be the same.
Why people are not taking any action – simple – we are reactionary creatures. We fight each other on who is right or wrong, whether humans are responsible for climate change instead of working together to ensure that the future generations are safe.
We are eating our children and our grandchildren’s breakfast, lunch and dinner in a big and global scale and no one bothers or talk about it because it is too big for anyone to see. However, we humans screamed at Facebook or newspaper when one mother did not feed her child or steal his food (on why the mother can be so cruel). That is true irony….
Greatest thoughtful rant ever!!!
Kurt – if you read the comments in its entirety, then you get a different perspective. At times, people can be so persistently wrong and it shows up so clearly.
Excellent post CTG…one of your best ones yet…it’s fascinating, even though your posts are clearly written and well thought through, most people will read them and still not “get it” (outside of OFW of course, but also a few who are here).
No, I don’t get it.
We have the shopping malls today, filled with crap today, people shopping and eating today.
This is not something borrowed from the future.
we have lived/are living in a state of surplus energy consumption.
that surplus energy availability gives us the excess which we consume and think of as ”our standard of living”—that to us is normality, but it isn’t normal, it is an anomaly.
”surplus energy” is being drawn out of the ground at a rate faster than it can be replenished–the oil coal and gas–which was laid down millions of years ago. it has been a ”once only” gift of nature. It cannot be repeated.
right now, as of 2016, we are consuming 10 times the amount of oil each year than we discover.
(hope the pic works here)
1*8I8ADTTKc4bLzwrL-picTA.png
that—by any measure, means that we are in a bankrupt economy, We disguise that reality by printing money and lending it to each other.
—yet we go on consuming because we know no other way of living—that is how we are consuming the future of our children and gggggggrandchildren….forever.
they can never enjoy the comforts we have enjoyed because we will have burned everything necessary to make it.
and no–they will not find ”alternatives” because you cannot make anything of any consequence without the use of heat to convert it from something else.
and we need oil coal and gas to provide that heat.
The party is over, we are the last to leave,
I am with with you until the grandchildren will not have the same standard as us, maybe not we either if we live long enough.
So … they will have to make do with less.
At some point this will be less than what you can survive on, that’s when it’s game over.
Debt enables people to buy things they cannot afford to pay in cash. It brings forward your consumption decision. You want to buy the car. Long car, you saved until you can afford to buy. Now, you buy first and then think whether you can afford or not. Therefore, the cases of bankruptcy is rising. You may end up buying something that you don’t need or cannot afford. You may even buy 2-3 houses or cars. It is an instant gratification and like Wimpy said (something similar)- I will pay you Tuesday for a hamburger today. You may not want to have another hamburger(s) in future. It is just like cash for clunkers. People pull forward their needs and after cash for clunkers, the sale dropped dramatically. The “cash” that you get is actually debt (to the government or taxpayer).
….yes but whats that got to do with brexit, are you seriously suggesting this was the foremost thought of the average UK voter when they cast their ballot last year?
sorry i couldnt answer below to your reply,and thanks for your answer, which in principal i agree with.
maybe Gail put this in her presentation as a bit of tongue-in- cheek humour?
Not trying to sound superior in any respect here, but the average Brexiteer wouldnt have a clue what I was on about.
A falling standard of living always has to be the fault of some other circumstance. In our case, the Farages point to the EU as a blame-focus—thats easy, so the mob goes along with that, and votes out.–get rid of all them foreigners.
Trump points to Mexicans–Muslims whatever–so the mob goes along with that
Hit-ler fingered Jews, gypsies, and the mob went along with that
In 17th c England, protestants blames o—the list goes on —-but The mob motivation never changes wherever you find it.
The ultimate problem is that the world economy is a Ponzi scheme, where payouts at the top depend on more and more suckers being drawn in at the bottom to supply input support. Right now the scheme is failing, but few see the ponzi scheme for what it is, being aware of only what affects them personally
Brexit is complex: many very well off people voted for it – not just the ‘poor working class whites’ (horrible way of speaking about people these days – because they dislike the EU, are patriotic and dislike the idea of a European super-state and domination by the ghastly Merkel.
One of the richest men in Britain voted for Brexit because ‘I hate that drunk !**t Juncker!’
Many voted against joining the EEC in the 1970’s – this was their chance to vote again.
I agree Norm, people don’t see the big picture…they find a scapegoat and blame it on that. It is sad that systems thinkers are a huge minority.
https://kdelsorbo.files.wordpress.com/2014/04/aftermath-of-an-awesome-party.jpg
Brilliant and concise summation! Thanks.
That was directed toward Norman from above. (Not that I don’t appreciate Fast Eddy’s contributions.)
Debt is borrowing from future. It pulls demand forwsrd
Ok, you borrow money and give it to me and I provide a service instead of sitting on my a$s, therefore resources are used today, not next year ?
And in the future either you will be my slave or you will not pay me back. Or you will pay me back with money that doesn’t buy anything.
you decide to buy a house.
a house is a block of embodied energy—bricks, glass, plastic and so on—worth £$xxx0000s All made with the heat input of fossil fuels.
There are 2 ways to do it. You pay for it with cash you have in the bank—i which case that represents XXyears of work that converted your energy output into physical money at some previous time–lucky you.
Or–you get a mortgage.
Somebody is willing to lend you their money, which represents their XXyears of work converted into physical money–lucky them.
Works converts energy into money–but in order for that to function, there has to be energy available to do it—If you work in a car factory—cars have to continue to be built and sold in order for you to collect wages. If cars aren’t built–you get made redundant. but cars cannot be made without inputs of raw energy.
The same economic principle applies to all jobs. (If hospitals dont get sufficient energy input, then doctors get made redundant too)
So you borrow their money for a 25 year repayment period—which means you expect to have an energy-consuming job for the next 25 years.
That energy that sustains your employment has to come out of the earth.
We have to burn fuel to keep ourselves employed, therefore your house-debt is drawn on the expectation of availability of oil coal and gas for the next 25 years.
But depletion data clearly show that fuels are in steep decline and cannot be sustained for the next 25 years. therefore you cannot sustain your debt over that time.
What the conclusion will be to that is beyond by imagining–but certainly not very pleasant I fear
I borrow 8 years salaries and buy the house.
I don’t mortgage, just pay the interest, it is that way here. The interest may very well become negative or at least zero soon.
At some point I can no longer maintain the house.
Houses should be among the first to lose value. You have to eat and you “have” to have a car and go to Thailand, so when not allowed to borrow you can’t pay much for houses.
When under the water in the current house you can’t move either, stuck until you can’t even maintain it in a liveable condition.
You obviously think resources are infinite. What do you think happens if you need a fish resource to be able to eat in future years and someone comes along and drops a net over the breeding grounds and wipes them out?
I do get it, ctg! Yes I know you need to rant, but you have nothing more to convince me of.
Here’s my question to you: what are you going to do about it?
Interesting how nobody here ever answers that.
we have collectively and eagerly and willingly locked ourselves into the system that will ultimately kill off most of us.
not a lot we can do about it
Jump from a tall building … crash a car into a rock cut….
When BAU collapses…
In the meantime I am Burning More Coal Now trying to keep BAU alive
I am not here to convince anyone. Anyone who does not have the capability to see the “big picture” will never get it. These things need no convincing. It is binary- either you see it or don’t. I am just putting what I have in my mind in words.
CTG
‘He who tastes, knows.’
And people oh so carefully strapping their darling children in car seats, while doing nothing about the air pollution originating with diesel engines which is damaging their lungs and brains from the first tiny breath….
Man is irrational.
Bravo,
First time I have replied, followed OFW for years and I totally agree. I am a small manufacturer in the Atlanta area who runs lights out for 16 hrs per day and the problems to automate this. I also have a feel on how the economy is running and can see what is happening to retail through my customers. Robots and AI are far away in taken over from humans. That is all a pipe dream , decades away.
Thank you Gail for all your hard work in explaining all this. Much appreciated!!
Dutchman
I think some of your observations about human behavior are right on. We are wired for certain cognitive biases — they are essentially instinct. Not planning ahead is a basic human tendency that is almost impossible to overcome, especially when we are working together in groups. We are wired for a “see food” diet, see food and eat it, that is. We are capable of a certain degree of long-range planning but we are really not that good at it. Our assumptions for the future tend to be wildly incorrect. (That is why I take predictions of doom with a grain of salt; many a doom predictor has come and gone and been wrong, data or not.) We can make fact-based predictions, but our ability to correctly interpret data and extrapolate it into the future is really not optimal.
We may be wired this way because food was seasonal and perishable in Hunter-Gatherer Land, and things not eaten immediately would spoil and be of no use. In that situation, future planning didn’t offer any benefit. A bounty left on a bush in the wild may be eaten by other humans or animals and could not be saved for future use. Better to have a party now than have rotten berries later.
Normalcy bias is also very real. This is why I think that when collapse arrives, most people will not realize what it is. They will not live long enough to realize it. Most people will probably view it primarily as a political event and direct their anger at the “appropriate” government entity. Some people will wait for BAU to return until they are literally incapable of doing anything to help themselves. There is a book called “The Unthinkable” by Amanda Ripley, who describes why some people survived 9/11 while others did not. Specifically, the ones who survived were the ones who recognized the magnitude of the disaster and the danger that still remained even after the first plane had hit. Humans are reluctant to break out of their routine in an emergency, returning to what feels safest and most comfortable to them. I’m sure there will be some marauding gangs and whatnot, but there will also be people who shelter in place hoping their normal lives will return by magic. They may be a majority. Those who are proactive and realize what is happening may have a chance of surviving.
In many respects most people are not a lot different than a common house dog….
Wow, a dog! You give people way too much credit. I’d say most people are as dumb as yeast. https://www.quora.com/Are-humans-smarter-than-yeast
‘Those who are proactive’
Define proactive….
proactive is get ready before something hits. Very rare among homo sapiens
Proactive is a general who did read the art of war and makes the surroundings work for him. Winning against unbelievable odds..
1.Make the best projection of the future. 2. Collect some strategies how to react differently on that future. 3. Start preparations and action according to the best of those strategies, despite the future hasnt arrived yet.
Not waiting for someone else to tell them to act, for one thing. In this situation that may not make a big difference, but in your average disaster it does. I’m sure you’ve seen the opening scenes of The Poseidon Adventure. Most of the passengers are content to wait in a dangerous area until an officer tells them what to do. They don’t initiate any action on their own. Until the flames get there, of course.
I refer to Norman’s excellent comment regarding loading up in the life boat in the middle of the ocean… and there not being any rescue ships to save you.
You just bob around on the waves until you capsize and drown or starve or terminal dehydration kills you.
Hence the importance of intuition, the little voice that whispers, of dreams and premonitions, gut-feeling and second-sight……
Gypsies distinguish ordinary dreams and ‘ strong dreams’, often symbolic.
Oddly enough, as one instance of a ‘strong dream’, when staying with my gypsy cousins in Spain-the wife reads the Tarot – I had a very odd dream which although surreal turned out to exactly prefigure the situation I found on returning to England – it was rather horrible, a bit of a glimpse into another soul.
But accurate. 100%. If only one could plug into that all the time, but I don’t think it is permitted in some way……. In fact, mostly it’s better to be ignorant, if one wants to be happy.
I don’t believe our minds can take too much truth. We would go insane.
I agree. The more I read about psychology and sociology, the more I think that objective truth doesn’t have much adaptive value to humans. In some ways, the people are on this board are those who lack the adaptation that denial provides.
Yes, therapy is not about stripping away peoples defenses it is about providing them with better adapted defenses.
I don’t know if insane is the word. Depression would seem more fitting.
Thank you for this amazing comment, CTG. Very interesting thoughts about needing certain genetic mutation to accept these finite world issues. I have worked many years as an engineer in similar field as yours (programming robots) and I really feel your pain regarding people touting AI robots as our savior. There is really no such thing as true AI (sentinent robots) that’s just science fiction. AI is just a program designed to make decisions in a complex enviroment with fuzzy inputs and outputs. Everything “AI” does can more or less be tracked back to how it was programmed and set up. But unless someone have worked with AI or robots then they have no clue about what it really is and its limitations. Sure they can be programmed to learn/mimic human behavior but what use is that, we have more than enough humans.
“Sure they can be programmed to learn/mimic human behavior but what use is that, we have more than enough humans.”
Nobody has yet agreed with me but: as long as humans are taxed heavily AND must be paid minimum wage there will be rational to automate.
Those doing the automation will be paid well and taxed heavily to pay for the unemployable.
Maybe and maybe not. So far, robot owners have been able to avoid high taxation, just as other businesses do, by moving to favorable jurisdictions. That is another advantage of robots. It is governments that ultimately fail.
lol!
Bravo, excellent analysis.
i want to ask to all reader of ofw which is next country gonna collapse
india/pakistan/mexico/eygpt/some other country which do you know
Mexico. Reasons being NAFTA destroyed their economy by allowing the US to export all of our agriculture industry into their market. Where there local farmers and such could not compete. And there cash cow second largest oil field on earth went into permanent decline about a decade ago. And now with the election of Trump it has almost finished off there currencies value.
Irony is that the mexicans are the 2. most fat people on earth (after US americans of course). Not an adventage in case of collapse.
Mexico City has 50000 people without running water. Armed soldiers are required to guard the water trucks that bring water in. What happens when they cannot protect the water trucks? …Chaos
It’s a toss up between India and Mexico. I’m leaning towards India.
I’m going with Pakistan.
I’ve been living in Jalisco in Mexico.
Canada?
http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/05/01/20170504_toronto1.jpg
Toronto is a mess.
I have friends that own homes and have jobs that can transfer them .
They all say no Toronto is center of the earth I will not move.
I gave up on using logic on them about 2015.
The plunge continues….
Noble Group Ltd.’s shares plunged to the lowest level in 14 years after it warned of a first-quarter loss and as S&P Global Ratings said the commodity trader’s debt-load is unsustainable given its current earnings path.
Shares of the Hong Kong-based company, which counts China Investment Corp. as one of its largest shareholders, slumped as much as 23 percent to 99.5 Singapore cents, the lowest since February 2003, and was at S$1.01 at 2:11 p.m. in Singapore.
This means Noble’s market value has shrunk to less than $1 billion in U.S. dollar terms, a shadow of the $10.2 billion trading behemoth it was in 2010.
https://www.bloomberg.com/news/articles/2017-05-11/noble-group-s-shares-plunge-to-14-year-low-after-flagging-losses
SolarWorld Files for Insolvency, Citing ‘Ongoing Price Erosion’
https://www.greentechmedia.com/articles/read/solarworld-files-for-insolvency-citing-ongoing-price-erosion
Pemex’s Pension Problem: Why the Oil Giant Is on Slippery Ground
http://knowledge.wharton.upenn.edu/article/pemexs-pension-problem-oil-giant-slippery-ground/
Hi!
Is this what comes next?
Inflation soars in Kenya & Egypt
Imagine what will happen if oil goes to $100
https://youtu.be/FYCjYf_hTmA
https://youtu.be/1MSnNANGyUE
Cheers
Oil is not going to 100 dollars a barrel; at least not for long.
This is a sort of BAU Lite situation …. the city is of course still completely plugged into BAU … the electricity is on… the gov functions… the shops have food… most people have money … the police are still on the job….
Yet it is starting to look rather grim…
Now imagine what it will look like when BAU ends.
Baltimore Has Become A Rotting, Decaying War Zone Amid Raging Opioid Epidemic
To say that the city is in a state of decline would be a major understatement. Everywhere you look there are abandoned buildings and homes, and as you drive through some of the worst areas you can actually see drug addicts just lying in the streets.
There are some sections of Baltimore that you simply do not go into once the sun goes down. And actually it isn’t a very good idea to go into those areas during the day either.
Through the end of April, Baltimore was on pace for the highest murder rate in the history of the city.
The primary factor fueling all of this violence is an opioid epidemic that is completely and totally out of control…
The opioid epidemic is the quiet killer that has been leaving a trail of bodies on the streets of Baltimore.
“The individuals that are putting these drugs on our street, they’re killing people on our street,” said deputy commissioner Dean Palmere of the Baltimore Police Department.
Drug overdoses is expected to have killed 2,000 people statewide in 2016 and more than 800 in Baltimore alone.
“There are more people dying from overdose here in Baltimore City, than there are dying of homicide,” said Baltimore City health commissioner Dr. Leana Wen in February.
Of course Baltimore is far from alone. On Monday, I wrote about how Chicago is becoming a gang-infested wasteland, and on Tuesday we got news of Chicago’s 200th homicide so far in 2017.
More http://www.zerohedge.com/news/2017-05-10/baltimore-has-become-rotting-decaying-war-zone-amid-raging-opioid-epidemic
I heard something about Argentina after the big crisis there: in the cities, and I believe rural areas too, there was a kind of delayed effect, as the generation of children from permanently impoverished families grew up and turned into desperate criminals addicted to a cheap drug – consequently more violent and unpredictable,and very callous.
Deeply resentful, too, of those who hadn’t had their bad experience. My Argentine relations left for Spain because of the violence, and the rapes, not the economy as such as they were OK.
This is why we need to keep the show on the road: cities can still function superficially, but be truly awful places to live.
Look at the extremely high murder and rape rates in S.Africa – if they all knifed one another to death in an orgy of violence then it wouldn’t be so bad, but it just drags on and on.
I’m all for sudden total Collapse: the alternative, waking up to find yourself in a Karachi or a Kabul just doesn’t bear thinking about.
That’s the irony…
The BAU Liters mistakenly believe that if such a situation were possible (a slow descent) — that it would be a good thing…
When in fact it would be like a dog dying of cancer… he’s suffering badly … but he staggers on…
The best result would be a very quick hopefully painless death…
Fortunately BAU Lite is not possible
Bau Lite is indeed very unlikely. For nearly 3 years now i have believed that if i prepped sufficiently for collapse i might make it through.
Part of me fears you are right that even collapse with major preparations isn’t survivable. It was you who alerted me to the spent fuel pond scenario throughout your various posts. That issue was the first that really started to corrode hopes i still had. Nevertheless i can’t let it go. My mind keeps mulling it over. I guess we are just pre-programmed to try and survive.
How are you coping ? Have you fully accepted this ? Do you still catch yourself thinking in peppers-terms or does it wear off ?
The doubts were creeping in long before I realized that the spent fuel ponds represented an extinction event… the food issue was another major concern that became difficult to ignore…
Mr cognitive dissonance was doing his best to push the doubts to the back of my mind… but I overcame him and realized this is all futile…
I do not think of prepping – I do not feel stressed by having reached these conclusions — in fact I feel a weight off my shoulders…. I am not always trying to think ‘is there something I am forgetting to do — what if this goes wrong am I ready for it…’
And then there is that gnawing voice in the back of your head arguing with Mr CG — telling you that this is all pointless… a total waste of time of money…
The arguments are gone —- and it is much more peaceful….
Here’s how I”m coping: Today I bought a hose with a five year warranty. As I filed the receipt and warranty, I started laughing because the warranty extends to 2022 and I doubt we’ll be around by then. I’ve prepared for this by enjoying even more my creature comforts like warm water and electricity. And yes, I have stored food (probably six to eight months worth) and water (six 55 gallon barrels) but not with the idea that this will get me though to whatever the bitter end is, but that I can be in some sort of relative comfort until I decide to end it all. I have adult children and if it comes to them or me eating (assuming they make it here to where I am), I will just off myself. I don’t’ have a gun now but will get one when I see things just starting to fall apart. I don’t fear death.
I guess there is a lot of ambiguity to the term BAU lite. This article plus the clip pretty much depicts what I define as BAU lite, slow decline. Slowly increasing poverty, unemployment and misery. People scraping by on welfare and crime.
Those houses didn’t go vacant over night. Collapse came to them, one by one, slowly… slowly… We are living the collapse. My bet is that we still have about 10-20 years before we face major die-offs due to food shortages and epidemics.
There is no f789ing way that we can have a Venezuela-type situation in America … or any other OECD country — without the financial system imploding and BAU ending – fast.
The global economy as a whole either grows — or it stops growing — and collapses.
Unplug a key pillar (see Korowicz) and it collapses — fast.
What is it people do not get? The utter retardation and stupidity on display here is epic.
Maybe the way to clarify it is to say that peripheral, less complex economies, – mostly only sources of commodities – can end up in a Venzuela-Zimbabwe state, but that the Core regions cannot descend to that level and still cohere. The End.
I am quite surprised as well that people that come to this site regularly think that BAU-Lite is possible…I mean 10, 20 years (some say decades)…Are you kidding me…look at what is happening now…there is NO way this goes on for decades..
Proponents of slow collapse underestimate the size of the disenfranchised American under class. Many have lost or never even had a piece of the pie. Once there is any indication of large scale riots against the government or financial system all hell will break loose, the dollar will collapse, chaos will rule the streets and police will be helpless to stop it. These folks will destroy everything and anything in their path. After all when you have lost everything and have nothing to loose….you loose it!
Just as you have these peripheral countries like Venezuela, you have peripheral neighborhoods, cities, counties, states within OECD countries. Collapse/BAU-lite will chip away at these one person at a time. The core (e.g. San Francisco, New York) can grow for a long time even if peripheral areas are in collapse (Baltimore, Detroit etc).
I agree…if the US had riots over food on a national scale…the US economy and financial system would collapse fast. It would be very hard to reverse the implosion once its starts in US. Chaos would reign and millions of despondent and poor and disenfranchised people would take full advantage of the situation to display their displeasure with the status quo and destroy everything they see.
RECORD LIES. RECORD COMPLACENCY. RECORD CRASH
http://ponziworld.blogspot.ca/2017/05/beware-self-imploding-bullshit.html