Why We Should Be Concerned About Low Oil Prices

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.

About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to financial problems for oil producers and for oil exporting countries. We are really dealing with a physics problem that affects many parts of the economy at once, including wages and the financial system. I try to look at the overall problem.
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2,716 Responses to Why We Should Be Concerned About Low Oil Prices

  1. psile says:

    These Eleven Retailers Will File For Bankruptcy Next, According To Fitch

    …Fitch has also revised its “retail concern list” which compiles issuers with a significant risk of default within the next 12 months, and which now lists nite retailers, up from eight the last time we showed the list in April, including:

    Sears Holdings
    Nine West Holdings
    99 Cents Only Stores
    True Religion Apparel
    Charlotte Russe
    Charming Charlie
    NYDJ Apparel
    Claire’s Stores
    Chinos Intermediate Holdings (J Crew Group)

    We expect his list to grow over the coming months, as some names fail only to be replaced with even more near-death retailers in a country where as the Fed reported earlier, 23% of Americans cant pay their monthly bils while 44% of Americans have less than $400 in cash.

    And, does this trend look remotely sustainable to you?


  2. Fast Eddy says:

    I would not generalize re: inherited wealth… I have come across more scions who have added to the empire vs those who have adopted the Trustafarian lifestyle…

    I struggle to believe that Musk and Hawking believe that we can move to Mars —- they would be aware of the cosmic radiation issue…

    As for ‘they’ I will recount an incident that happened months prior to the Snowden affair…

    I was discussing with a very good friend – who is also an engineer — actually he is the scion of a fairly wealthy family — he ended up a partner in a global engineering firm selling out and retiring at 40…. so we kill two birds with one story…

    In any event … he is no dummy.

    I was explaining to him how 20 years previous I was playing ice hockey for a team that was supported by a telecoms king pin. One of the players on the team was a partner in the firm and reputed to be one of the world’s top engineers re: setting up mobile networks in cities with a lot of tall buildings …

    I was recalling how in the 1990’s this engineer told me point blank ‘never say anything compromising on a phone call — everything is monitored because we are forced to install monitoring software on our networks — if key words are mentioned e.g. cocaine …. that triggers the next level of response — and you will be monitored more closely’

    Based on this I was explaining to my other engineer mate how the US government (essentially the Elders) would be monitoring and storing every single communication globally. They would be using far more sophisticated technology vs the 90’s….

    They would be doing this because it gives them control over the population — recall how Hoover kept files on a lot of people and used that to control them…. think that formula x everyone.

    He basically shit all over the claim — not quite laughing at me — but I am sure he was thinking I was a paranoid mad man….

    Then a few months later … Mr Snowden emerges on the scene….

    Needless to say engineer friend was looking a bit like a sheep…

    When I refer to ‘they’ as in the Elders… I am not just pulling this entity out of thin air… It is based on my having read The Elders of Zi-on (twice)… it is based on this Benjamin Friedman speech


    Also — did anyone notice how every POTUS kisses the ass of Israel? Every single one of them swears to support Israel …. unconditionally…

    Israel is a tiny nation far from America — yet POTUS kisses the ring. Does POTUS kiss the German ring? What about its neighbour Canda’s ring? Or China’s ring?

    Nope — he kisses the Israeli ring.

    Think about that.

    As well – why does a private company get to print the world’s reserve currency – and collect interest on that money???

    And just as I was given insider information from a telecoms principal/engineer about the level of spying going on …

    I have also been given insider information from some very key people about the Elders:

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

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

    “I am a most unhappy man. I have unwittingly ruined my country. A great industrial nation is controlled by its system of credit. Our system of credit is concentrated. The growth of the nation, therefore, and all our activities are in the hands of a few men. We have come to be one of the worst ruled, one of the most completely controlled and dominated Governments in the civilized world no longer a Government by free opinion, no longer a Government by conviction and the vote of the majority, but a Government by the opinion and duress of a small group of dominant men.” – Woodrow Wilson, after signing the Federal Reserve into existence

    “Some of the biggest men in the United States, in the field of commerce and manufacture, are afraid of somebody, are afraid of something. They know that there is a power somewhere so organized, so subtle, so watchful, so interlocked, so complete, so pervasive that they had better not speak above their breath when they speak in condemnation of it.” ― Woodrow Wilson

    It could not be more obvious who controls the world. If people cannot see it then that is because they are conditioned not to see it.

    If you want to understand why you cannot see what I see — try to explain to someone how BAU is about to end because we are out of cheap to extract energy.

    You will feel EXACTLY how I feel.

    • CTG says:

      The grip they have is going away very fast anyway…….

      • Fast Eddy says:

        Nothing focuses the mind more than an extreme crisis…. unfortunately the best they can do is delay the end game…. they have run up against immutable limits…

        There will be no handing over of the reigns as has happened many times throughout history — most recently when the British relinquished their control of the world

      • greg machala says:

        I agree. The early bankers (namely JP Morgan and Nathan Rothschild) wanting to take full advantage of cheap and abundant energy devised a scheme to tokenize it with fiat money. It took time and tenacity on their part. But, 1913 was a real milestone for JP Morgan. The first big hurdle the father of the too big to fail banks faced was getting the sole right to print the money. They achieved that goal in 1913. Then, the ultimate plan played to its finale when Nixon ended the gold standard around 1971 and money was completely fiat backed by energy and the petro-dollar was to truly come into its own. They and their successors were and are very well off. Very, very well off. More so than any group has ever been in the history of humanity. I don’t think this was an accident at all. This was carefully thought out and planned.

        • Buzz Lightyear says:


          doesn’t mean the planners will achieve their goals but to deny the existance of said plans is to be wilfully blind imho

    • Buzz Lightyear says:


    • Jarle B says:

      FE, I bet you have some interesting theories about say the World Trade Center plane incident, please share.

      • Greg Machala says:

        Google AE911truth and read up and draw your own conclusions.

      • Buzz Lightyear says:

        Look at this way… the most powerful military on the planet backed by the largest defense budget defeated by… a few box cutters

        • Fast Eddy says:

          All anyone needs to know about the world trade centre false flag is here …

          This is the NIST mathematician (NIST is the government organization that investigated 911) who recently emerged to challenge the findings… https://www.nist.gov/

          Like he says — massive steel girders do not get thrown horizontally when a building collapses — they fall down — unless a very powerful explosive force was involved…. (see the video footage of girders flying out of the building as it collapses)

      • JMS says:

        When the official version is physically impossible, we can only conclude that it’s a lie. Webster Tarpley is clueless about finance and economics, but about politics I think he knows everything there is to know. I suggest we read his book about 9/11.

    • JT Roberts says:

      Right FE everyone is conditioned not to recognize it.

      1John 5:19

      the whole world is lying in the power of the wicked one.

  3. CTG says:

    Thins are too complex to predict. A flap of the wings of butterfly may cause a hurricane somewhere else. The keyword is “MAY cause”.


    p.s. if you don’t know or understand derivatives, you may not know “counterparty risks” and that this may be the trigger. (again keyword is MAY).

    Each issue like auto, student loans, China’s debt, Japan, etc deals a mortal blow to the system. The system can only take so much before a tiny flap of the wings on an insect will blow it apart. (hat tip – Norman for telling us that a true Black Swan will be the cause)

  4. Fast Eddy says:


    In other news today… American forces mistakenly dropped a massive bomb on a wedding party in Afghanistan but nobody gives a f789 because a wedding party is not a pop concert — and brown people don’t really matter.

    • my thoughts exactly

      we poked our oilstick into the hornets nest of the middle east 100 years ago, wrecked their economies and killed 00000s—now we’re complaining at getting stung

  5. James T says:

    Not very realistic.
    This guy in Northern Queensland Australia is very interesting.

  6. jerry says:

    Geneva (AFP) – The Swiss voted Sunday in favour of a massive overhaul of the country’s energy system by gradually replacing the power from its ageing nuclear reactors with renewable sources.

    • It is too bad that they didn’t do a little research first. Perhaps they are planning to cut down their trees.

      • Buzz Lightyear says:

        Why not… everyone else is

        Wood – The fuel of the future


        In its various forms, from sticks to pellets to sawdust, wood (or to use its fashionable name, biomass) accounts for about half of Europe’s renewable-energy consumption. In some countries, such as Poland and Finland, wood meets more than 80% of renewable-energy demand. Even in Germany, home of the Energiewende (energy transformation) which has poured huge subsidies into wind and solar power, 38% of non-fossil fuel consumption comes from the stuff. After years in which European governments have boasted about their high-tech, low-carbon energy revolution, the main beneficiary seems to be the favoured fuel of pre-industrial societies.

        • Cutting down trees seems to be very popular when it is someone else’s trees. Not so much, if it is a country’s own trees. Japan, in theory, could cut down its trees for fuel.

          • Fast Eddy says:

            Heating is one thing… but the primary cause of deforestation in Europe a couple of hundred years ago was cutting down trees for industrial purpose including use a building material and as fuel to refine ore and in forges…

            We do not use wood for refining ores or forging them now — but we will when the oil gas and coal are not available…

            And that will be the end of the forests — very quickly

            • necessity being the mother of invention, it was the shortage of wood/charcoal that led to coke/coal being used to smelt iron in the 18th c

              Darby never said—‘lets have an industrial revolution’

            • Fast Eddy says:

              There are so many who point to the 1800s or 1700s as a period that we can return to post BAU and live happily ever after.

              Here’s the thing…

              People living back then were not living sustainable lifestyles at all…

              They were killing whales for oil — they were hacking through forests at record rates — they were wiping out wild animals…

              If they had not discovered how to harness coal — then they would have collapsed into a very primitive state…

              And by primitive I do not mean living like Scott Nearing … living like that requires metal tools — metal tools require energy — which meant trees — but all the trees within a reasonable distance would have been chopped down ….

              They would have been facing the same situation we are now — they would have run out of trees — we are running out of fossil fuels.

              Unfortunately there are some major differences — now there are far too many of us — we have ruined the soil — and we have spent fuel ponds — so we don’t even have the option or returning to a very primitive state

            • I agree. But countries like Greece will turn to burning trees, when they cannot afford other options.

              Japan seems to be covering its farmland with solar panels (and presumably adding debt to do so). This seems like a silly solution. It seems like the might be better off burning some of the wood from their trees. Japan seems to have about 24,960,000 hectares of forest. Its agricultural land drops year after year, and is now down to something like 4,250,000 hectares, according to https://knoema.com/FAORSL2014Aug/resource-statistics-land-december-2015?country=1001080-japan Japan’s total area is 36,450,000 hectares.

              Of course, cutting trees would lead to erosion. So no easy solution.

            • Fast Eddy says:

              We would quickly run into the diminishing returns issue with trees… as we have with fossil fuels…

              In fact we’d hit the limits very quickly….

              First we chop the nearby trees… and get a massive return on energy…. then we have to go further and further from our settlements to chop trees and drag them home….

              Eventually the amount of energy involved in obtaining trees is not enough to bother….

              And moving the settlement is not the solution … that involves energy in rebuilding … and also settlements need to be in areas where there is water, good soil and a reasonable climate..

        • Fast Eddy says:

          In the 1800s, the biggest driver of European deforestation was burning wood to drive steam. In England especially, coal only began to be exploited as a fuel for steam engines after their supply of wood (reduced into charcoal to increase its heat output) became too low to be economically feasible.

          Remember that the first commercially feasible steam engine ( Newcomen atmospheric engine ) was invented in 1712, and Watt’s innovations and his savvy at using venture capital to commercialize the technology really got moving all the way back in 1774. We think about ‘industrialization’ as being a Victorian thing, but really, the entire history of the United States of America has been in a mechanized, industrial era.

          By the 1820s, powered mills were common in many industries — and deforestation in England was already WELL underway by the time the steam engine appeared:

          Primarily before industrial uses became so widespread, land was being cleared for agriculture, and wood was being burnt for household fuel and direct industrial uses (like boiling dyes, forging and smelting metal, etc).

          Wood was the primary fuel all over Europe until its shortage meant it was finally economical to pay men to dig ridiculously deep holes and extract coal from the earth.


  7. Bones says:

    Hi Fast Eddy,

    Is this you or your neighbors?
    Not a bad attempt at the Fast Eddie Challenge?

    • Jarvis says:

      Fast Eddy already has reserved a spot for Mariam in his harem. By their own admission they can last 2 weeks without BAU!

      • Fast Eddy says:

        She has accepted…

        That’s a decent attempt at the FE Challenge… far more than anyone on FW has been willing to attempt….

        They mention buying food from shops on a regular basis… which highlights one of the main problems with trying to stay alive post BAU…. food… or lack thereof …. and 7.5 billion people…

        The hunter gatherer lifestyle is very tough — especially when your bullets run out

        • greg machala says:

          I don’t necessarily think the hunter-gatherer lifestyle is necessarily tough. It is just that we forgot how to do it. And, we have lost the ecosystems that support it.

          • xabier says:

            I would say that family-scale peasant farming is the toughest thing of all, in a place with a fairly short growing season : as I’ve mentioned before my grandmother was a peasant from the Pyrenees, and recently I’ve found lots of videos of interviews with old-timers from that region, and a very rare set of four films showing life in the early 1970’s.

            A 19th century, and in some cases Neolithic way of life and dress (think sheepskin cloaks and leggings, heating milk or water with red-hot stones, etc) persisted until the 1960’s. Ox carts were still used, of a pattern the Romans would have recognised. Pastures were small, and chestnuts were an important cash-crop and basic diet, together with forestry work.

            After that most of the old villages were abandoned – the one originating her family name is now empty and disintegrating after thousand of years of existence.

            When asked about the past life in the village, the common response of the old people is ‘Duro, muy, muy duro!’ , ie. ‘Hard, very very hard!’, and also ‘horrible!’. Some cry. Most look as though they would rather not think or talk about it.

            When an old peasant tells you life was horrible and hard, it was. Even when born to it, even without famine or war, or excessive taxes.

            I’m proud to be descended from people who managed that life for so long, but they would be delighted to see that I live in such extreme comfort.

            • Greg Machala says:

              I tend to agree that farming is tougher than hunter gatherer lifestyles.

            • Buzz Lightyear says:

              You perfectly described life in Galicia until very recently. Now we have thousands of wind turbines gracing the hilltops!

            • JMS says:

              “You perfectly described life in Galicia until very recently”
              The same with rural Portugal until the late 70’s, where life consisted of hard work, discomfort and poverty. It is no wonder that since the 60’s peasants began to e/migrate en masse to the coastal towns or to central Europe. And in the Portugal countyside today there are hundreds of deserted or almost deserted villages. With no peasants, only summer tourists, silence and beautiful scenery.

            • ITEOTWAWKI says:

              Greeks have been moving back to their ancestral villages since the GFC, but life’s not easy there..this article is from 2012, but things have not changed since then…

              “It’s the ultimate irony: Greeks who moved away from the villages of their grandparents and parents to Athens, Thessaloniki, Patra, Volos and other cities looking for a better life and higher income now find themselves having to return because their buying power has evaporated.”


            • Not enough energy products to distribute. Cities have higher energy concentrations than villages.

            • JMS says:

              The portuguese are not there, yet. In fact, tourism boom in the last few years made everybody here think that happy days are returning!
              It’s true that unemployment among young people is very high, but they prefer to emigrate to England, Switzerland, etc. At the rate of 100 000 per year in the last five or six years.

            • Fast Eddy says:

              Attention Preppers:

              When asked about the past life in the village, the common response of the old people is ‘Duro, muy, muy duro!’ , ie. ‘Hard, very very hard!’, and also ‘horrible!’. Some cry. Most look as though they would rather not think or talk about it.

              When an old peasant tells you life was horrible and hard, it was. Even when born to it, even without famine or war, or excessive taxes.

              And I would add…. no hordes of starving desperate violent people coming at you ….. with no police protection

        • Duncan Idaho says:

          Actually, lots of free time.
          And from skeletal remains, embarrassingly healthy in many circumstances.
          The planting of wheat in the Fertile Crescent, and the Haber Process sealed homo sapiens extinction.
          Oh, and hitting the energy lottery.

  8. JMS says:

    This is hilarious, and I have to tell it here because I have any other place where to doit. My “boss” has commissioned me to translate “No is not enough”, the next book from Delusistan’s Queen, Naomi Klein. It’s funny because when I read The Shock Doctrine in 2009 I thought wow what a great book, but at the time I still lived in the hinterland of Ignoramusland (bordering FE’s Delusistani). Years later I emigrated to Realistan, and my admiration for Naomi Klein was reduced to dust. Well, the things a person has to do to earn a living!
    I would have preferred a million times to translate Norman Pagett’s book, but my employer would receive that proposal with the same silence he received, in 2012, my proposal to translate Richard Heinberg’s “The End of Growth” or Craig Dilworth’s “Too Smart from our own good”…
    Well, I’m sure It will be hilarious/infuriating to translate this. And of course I will need to activate all my devices of mental compartmentalization to complete this assignment.

    • JMS says:

      because i have no other place

    • lol

      am sincerely flattered

      but as you say—nobody likes reading bad news.

      but somebody was given an earful of bad news 5 minutes before this vid was shot.

      Watch it carefully

      fair made my day–I almost feel sorry for the guy, having riled her that much

    • ITEOTWAWKI says:

      I feel your pain JMS!!! BTW it is uncanny how many of us here have had the same thought process…you start off softly into the rabbit hole, liking stuff like Naomi Klein, but as you go deeper into the rabbit hole you discard many things…till you have discarded almost everything…except OFW 🙂
      BTW Heinberg’s book was an eye-opener for me….but even he is a delusistani…He understands the predicament (which means no solutions whatsoever) but mistakes it for a problem (if we do this and this we will be saved)…not the same thing at all!!!!

      • I’m always playing the burr under Heinberg’s saddle

        He will keep banging on about electric cars, so it’s his own fault. Absolutely no thought of the purpose of transport whatsoever

        I don’t think I’m flavour of the month over at Resilience. Heinberg’s main problem is thinking that in the future everybody is going to be a nice quiet and civilised a guy as he obviously is.

        • Fast Eddy says:

          Or maybe he values the donations that come in from Koombaya organizations more than maintaining intellectual integrity

        • ITEOTWAWKI says:

          Hahaha Norman, believe me I know…I NEVER go on Resilience anymore, but I do go on Disqus to see your comments of which many are from Resilience…you destroy the writers and commenters all the time, quite entertaining.. I think half the likes on your comments you have on Disqus are from me lolllll

        • Duncan Idaho says:

          I lived in Santa Rosa, and Heinberg and I crossed paths frequently (I think he was more interested in talking to my wife).
          But agree. not facing up to reality on numerous issues.
          I used to post on the Energy Bulletin, and then Resilience, but have been absent for a while.

          Have any of you visited Dark Mountain in the UK?

          • Fast Eddy says:

            Overpowering Koombaya….. with a hint of BAU light…


            When contemplating the quagmire of obstacles and institutions within our capitalist society that interfere with the equitable and just interchange of currency and access to resources, I find myself motivated to explore less oppressive economic, social, and political human relationships.

            In doing so, I have become aligned with that ever-gallant and hopeful group of folks dismissed as unrealistic dreamers. We ‘dreamers’ always hold fast to the truth that the wilful designation of creation and power can be delineated into a network of horizontal or lateral functions that make greed, conquest, and competition unnecessary and invalid, except in extreme conditions.

            Much of my herbal work is spent with a shovel, basket and clippers as I dig and gather roots, leaves, flowers, bark and berries that are prepared into teas and other herbal formulations. I make every practical effort to harvest from local sources. This requires me to be tuned into to the seasonal cycles and growing patterns of wild plants. I also grow a variety of herbs in my own garden, and have become acutely tuned into conservation and ethical harvesting techniques that ensure the long-term survival and proliferation of our wild medicine plants.

            This art and practice of traditional herbalism has deep roots into the history of every culture on earth. These roots have twisted, turned and intertwined throughout thousands of years of human civilisation, often being lost and forgotten as the quality of our communal engagements and our narrative with the world has placed humans on top of a hierarchy that centralises power into an above-ground, rootless, disembodied, hegemony.

            • xabier says:

              Amusing: they should reflect that history turned out the way it did for a reason: hierarchies, wars, conquest, enslavement, environmental disruption or devastation (long or short-burn) – that’s us!

              Quite an act, on which the curtain will soon fall……

            • Fast Eddy says:

              And the meek shall inherit…. sweet f789 all…

              In fact they will get a yoke around their necks and sent out into the fields as slaves…

      • JMS says:

        In 2012 I loved Heinberg’s book, but later I found (mostly here on OFW) that he is too optimistic, to say the least, and I stopped paying attention to the things he has to say.

        Craig Dilworth’s book I still like a lot. He is in another league, I think. The league, say, of William Catton, who also knew that we have not just a “problem”, but that we are in a deep deep predicament.

        • doomphd says:

          i am not familiar with Craig Dilworth’s book, but i agree completely with all your other assessments. i think “disingenuous” describes much of what Heinberg has written lately. Catton, OTOH, is my hero.

        • I liked “The Long Emergency” by Jim Kunstler a lot better than Heinberg’s books. It brought out a different dynamic than Heinberg brought out.

          Much of Craig Dilworth’s book is helpful, but it is an academic book–a little hard to read for many people. I have met Dilworth (as well as Kunstler and Heinberg). Dilworth invited me to have dinner at his home in Stockholm, with his wife and daughter. Wm. Catton died in 2015.

    • Fast Eddy says:

      Maybe you can slip into the translation a few references to End of More…

      • ITEOTWAWKI says:

        Maybe some subliminal sh.t like back when you apparently played some heavy-metal bands vinyl records back in the 80s backwards it was the devil talking…

      • JMS says:

        Ye, that would be hillarious, but I can’t afford to annoy my employer, since is too soon (i hope!) in the collapse calender to get fired 🙂

    • JMS says:

      A small correction. It’s not accurate to say I have emigrated to Realistan in 2012, because i have a job, and my job, as most jobs, is in Delusistani (there is no jobs helas in Realistan!)
      Then it would be more correct to say that i live in Realistan, but work in Delusistan (fortunately, my working hours are few, because I’m lazy and don’t need to earn much money)

    • JMS says:

      Why, Naomi is not the queen of delusistani, she deserves to be crowned the Empress of Delusistan. If you don’t believe, read this excerpt of her book:

      “We declare that “austerity”—which has systematically
      attacked low-carbon sectors like education and healthcare,
      while starving public transit and forcing reckless
      energy privatizations—is a fossilized form of thinking that
      has become a threat to life on earth.
      The money we need to pay for this great transformation
      is available—we just need the right policies to release it. Like
      an end to fossil fuel subsidies. Financial transaction taxes.
      Increased resource royalties. Higher income taxes on corporations
      and wealthy people. A progressive carbon tax.
      Cuts to military spending. All of these are based on a simple
      “polluter pays” principle and hold enormous promise.
      One thing is clear: public scarcity in times of unprecedented
      private wealth is a manufactured crisis, designed to
      extinguish our dreams before they have a chance to be born.”

      LOL & RELOL!!

      • ITEOTWAWKI says:

        I think I just puked in my mouth a bit…the level of cluelessness is on another level…if she came to OFW there is NO WAY she would ever understand the concepts that we talk about here even if she read Gail’s blog from A to Z…because it is not just a question of reading about our predicament, but like CTG said some time ago (or something to that effect) you need to be open and ready to process this info..

        • JMS says:

          I think CTG is absolutely right. Nobody can pass from cluelessness to awakeness in a day or a month. It’s a process indeed. We begin by accepting the “less harmful” views, we assimilate them fully, and only then we are ready accept the full burden of truth.
          I remember when i found George Mobus blog, in February 2012, I thought, wow I thought I was pessimistic about the future of capitalism and industrialism, and this guy is saying a human bottleneck is inevitable! But in many ways I was even then ready to accept that idea. And therefore I just needed to continue to explore that rabbit hole. And i followed Mobus’ links… and eventually found Gail.

          • ITEOTWAWKI says:

            JMS I fully agree it is a long process…you don’t get to realize the full scale of the predicament in a day or in a month..it takes many hours of reading (I am easily in the 4-digit range in number of hours spent reading on our predicament since 2010)…you need to be open-minded and extremely curious..for me everything kicked off watching the documentary Collapse in December 2009..there was no way that after watching what Ruppert had to say during those 82 minutes, that I would just let it be and move on (which I am sure is the case for 99% of the people that watched the documentary) I proceeded to watch all the Peak Oil documentaries (which ironically mostly came out in 2005-2006 which was also the year that we very probably peaked on conventional oil)…and then you start following all kinds of blogs…circa 2011 I was following dozens upon dozens of blogs on topics ranging from the economy, energy, the environment and finance…and slowly but surely you start tying things together..that all these topics are intimately related…and I have to say that you learn from many on your way to enlightenment..whether it’s Heinberg, JHK, Martenson, Orlov, that pompous Druid, CHS from Of Two Minds and many, many others (George Mobus of Question Everything was also one, boy his blog entries could be long lol)…but as you go deeper into the rabbit hole, you start discarding many of them…you “graduate” to another level…there comes a point when you fully realize what we are dealing with and that there is absolutely no solution…and then you start cutting the number of hours spent reading on our predicament…you become very picky…you have gone all the way to the bottom of the (very,very deep) rabbit hole…you start taking advantage of every day BAU is in place..I savour my trip, my golf game, my bike ride, the nice sundown, every little thing, in a way that I would not if I thought I still had 30-40 years in front of me (I’m 45)…and I also enjoy exchanging here because the knowledge of all of this is so rare, that it is hard to talk about it with anyone..they just don’t understand what you are saying or think you’re a nut job..that’s why that after over 5 years of lurking reading Gail’s articles (and the comments of course), I finally started commenting as well…I’m very thankful for this blog and will probably stick around till the grid goes down and head off to my hand-picked high-rise!! 😉

            Carpe Diem to all OFWorlders!!

            • Fast Eddy says:


              I am loading up the ute as we speak — headed to the coast for some frigid mountain biking in the morning … then down to the far south where I intend to spend a week playing hockey on an outdoor rink that just opened http://alexicerink.co.nz/ (taking me back to my youth and being on the verge of frost bite every day on the outdoor rinks in northern ontario).

              Time is short. Experiencing are everything.

            • Volvo740 says:

              Well said! I too liked Martenson a lot until I understood that there was a gigantic leap in the end to a happy ending with renewables… So now I’ve turned my attention to the timeline of collapse. It has clearly started.

              BTW, for those that subscribe to sudden collapse, what’s the definition you go with?

            • There will be a fairly sudden sharp break that we will recognize when we see. It may be a major failure of the financial system. It could be the inability of the US to get a budget passed by the September 30 deadline, and a continuing problem after that. It could be a hard financial crash in China. It could be the breakup of the Eurozone, indirectly because Italy pulls out. One big problem is likely to trigger other big problems, like rapidly falling commodity prices, and financial failure of producers of many types of producers of commodities. Governments may collapse. Even if the crash is fast, it may actually take a few years for all of these various things to happen.

              It is possible that some physical problem will trigger the downturn–big earthquake or tsunami, or hurricane, or “Carrington event” affecting the world’s electrical systems. Such a problem would put stresses on other systems, pushing the system toward collapse.

            • Fast Eddy says:

              When the electricity goes off… permanently… that is collapse

            • ITEOTWAWKI says:

              Thanks Volvo740 (BTW always loved that car, my dad had a beautiful black 740 Turbo ’89, exactly like the pic below) 🙂

              I don’t know what to call it….instadoom?


            • ITEOTWAWKI says:

              Sorry Volvo740, I misunderstood what you said…if by definition you mean how this insta-collapse pans out, I have no clue..I just think that when financial system fails, when grids start to go down and JIT disappears it will be, like the clip FE posted a couple of days ago, a domino effect across the world..

            • Joebanana says:

              That sounds so much like me. Like a madman I read all those blogs too and tracked the price of gold all the time. Only occasionally do I read anything by them now. Definitely getting drunk with the boys more though. Had an absolute blast driving (we had a driver) around the backroads last week drinking beer. Much more fun than reading Casey research BS;-)

            • Fast Eddy says:

              Give er!

            • ITEOTWAWKI says:

              Haha Joe, I must admit I party up quite a bit myself (more than your average 45-year old, that’s for sure). The recuperation is a bit longer though than when I was in my 20s lol!

              Then again I’m not your average 45-year old with 2 young kids at home and thinking that there is no problem with the future, since self-driving cars are right around the corner and we’re going to Mars soon… 😉

            • Joebanana says:

              I’m 50 and definitely party harder than most but my friends are even worse. Heavy drinking culture here for sure. This was an unplanned spree. My buddy and I went to church that Sunday morning, he calls me up to borrow a three inch hole saw afterwords, brings two beer with him, and next thing you know we are off to the races!

              Only thing I have trouble with is not talking doom. A real buzz killer when I get on that subject. I’m feel like a guy fighting tourettes sometimes;-) it just wants to blurt out of me.

            • Thanks for your vote of confidence!

        • Fast Eddy says:

          Don’t you just hate that acid taste when you do that… it’s even worse when you puke and it goes up your nose….

        • xabier says:

          Oh, but she has a Dream!

          And she wants everyone to fulfill their Dreams, so long as they are the right people and the right dreams….

          It is well known that our Universe was set up precisely so that human beings could fulfill themselves.

      • Kurt says:

        In a moment of utter madness today I was explaining to someone that the oil companies are spending very little on finding new oil fields. They said that was a good thing because we need clean air. I told them we need oil to keep the economy running. They replied that clean air was more important. They also happened to be insanely wealthy.

        • psile says:

          These are the sort of people who believe that electricity is generated out of a wall socket, and that food is grown in supermarkets.

        • JMS says:

          I suppose you have endend the conversation by saying: “You’re absolutely right! Clean air is MUCH more important than oil. After all, we can’t breath oil. And life is mostly a matter of breathing! How silly of me!”

        • Fast Eddy says:

          And profoundly retarded…

          Did they by chance inherit the wealth?

          • greg machala says:

            Well if a person is wealthy then they the general economy is unimportant to them. However, if one has to work from pay-check to pay-check, the health of the economy is crucial. It seems to me that many wealthy persons attribute their success to hard work. And, that the wealth was earned independently of anyone else. It is OK to pollute, make noise and consume resources to become wealthy. But once the comforts of wealth is achieved, it becomes easy to deny others the privilege to pollute, make noise or consume resources. The resources must now be preserved for the convenience of the already wealthy. It seems an easy trap to fall into.

  9. Fast Eddy says:

    Get ready for job cuts at Ford http://www.reuters.com/article/us-ford-motor-ceo-idUSKBN18I0LK

    • Rodster says:

      Zerohedge has recently posted several articles on the issues facing the auto industry from subprime loans to the glut of used cars that are coming off leases with prices for used cars going down.

      Auto Industry Faltering:

      • Fast Eddy says:

        Wolfstreet has some excellent analysis on this as well.

        The question is — is this the problem that the CBs cannot fix — and thus the collapse trigger?

        Is this – along with similar problems in retail and restaurants — an indication that the CBs are pushing on a string?

        We are seeing data come in that indicates the consumer in America is tapped out on credit… nost cannot take on any more debt without collapsing into bankruptcy.

        Are we here?


        • Rodster says:

          We are not their yet but getting closer. The Auto Industry is one of the few manufacturing sectors left driving the world’s eCONomy. If the auto industry were to collapse it takes out other businesses that rely on it to survive, from sales and services.

          Then of course there’s driver-less cars waiting in the wings. No matter what part of the world you are from, people tend to form a connection with their vehicles whether due to status or driving pleasure. Driver-less cars doesn’t tick those boxes.

          • Fast Eddy says:

            ITEO — here’s an idea… instead of jumping from a building — or in my case speeding over a cliff into a pile of rocks…

            What we should be doing is buying driver-less cars… then when BAU blows out — just hop in and head off down the highway.

            This way you don’t have that moment where you are forced to do battle with Mr DNA — who will insist you soldier on no matter how dire the situation …

            Nope – with self driving you just set the controls — relax — and just wait till the auto pilot runs you into something head on….

            • ITEOTWAWKI says:

              Haha sounds like a plan…check out like that guy with his Tesla who was surfing his tablet and rammed the side of an 18-wheeler…

        • ITEOTWAWKI says:

          As long as good ole Wile E. Coyote looks straight we’re okay…unfortunately his head is starting to tilt down…so it’s a question of time before he realizes that the emperor (represented here by Industrial Civ) is absolutely buck naked…and then this happens:

  10. dolph says:

    On animal cruelty:
    -By no means do I enjoy these awful videos, but surely you all here realistically understand that power is why you are reading this, power is why you are fed and why the lights are on; power over nature first, power over other humans second, and power to extract and burn fossil fuels third; that is why you exist and have the lifestyle you do

    All of life is a power play; collapse dynamics will not change that; even “ecological” communities will need hard men willing to kill and be killed

    • Greg Machala says:

      I agree. Steve Cutts “Man” video shows this clearly. Millions of animals are slaughtered daily to feed hungry humans.

    • Fast Eddy says:

      Nobody is disputing that killing animals is necessary to put food on the table.

      The issue is that in many instances we torture the animals — and take pleasure in doing so.

      If that is what is done in so-called civilized countries …. then imagine what happens elsewhere… oh right – let’s look at what goes on in Indonesia


      The other issue is of course the nature of man — what we are capable of —- you think what they are doing to these cows is terrible … just watch what we do when there are 7.5 billion of us — and very little food.

      Anyone who has read history is aware that slavery was endemic — and that extreme violence and torture were the norm — when fighting over resources.

      I am not trying to scare people by stating your children and grandchildren are going to be strung up like sides of beef — to be consumed…

      That is GOING to happen.

      • xabier says:

        In ancient Ethiopia (ie until the day before yesterday) it was customary to tether the animal chosen for dinner outside your hut, and the cook would cut strips of flesh off it as it stood there, so that it was nice fresh meat.

        Just one step away from wild dogs or wolves biting chunks off their prey while still alive.

        How human beings can think so much of themselves, escapes me.

    • grayfox says:

      “All of life is a power play; collapse dynamics will not change that; even “ecological” communities will need hard men willing to kill and be killed”

      True, Even a vegetable gardener has to decide which plants to nurture (crop plants) and which to ruthlessly terminate (weeds). There is a lot of killing going on in gardening, but I don’t let it bother me.

      • Good point! When we talk about the end of many species, because of the actions of humans, we are including many species that we intentionally got rid of, because they were in the way of farming–both plants and animals. No one (that I know of) keeps track of bacteria and fungi that are affected by our manipulation of the system.

  11. Duncan Idaho says:

    This somehow doesn’t have a good vibe:

    • Bergen Johnson says:

      A séance to invoke powers to allow a tiny % to control a massive % to the benefit only of the super wealthy and powerful.

    • Greg Machala says:

      Dumber than yeast.

      • Fast Eddy says:

        Are we looking at Plan B?

        The energy source that will power the world when Ghawar runs dry…

    • psile says:

      WTF are they doing?

      • ITEOTWAWKI says:

        Malakies… 😉

      • Buzz Lightyear says:

        Wouldn’t you like to know…

        The look on the king’s face is somethin’ else!

        We haaave the poweeer

        • ITEOTWAWKI says:

        • psile says:

          There are more pictures. The uncropped version is a bit more diabolical…


          But the reverse shot is just straight out of a Bond film. Seriously, WTF?!


            • i keep looking at those pics—

              Mc Enroe’s famous comment at Wimbledon springs to mind

              “YOU CAN’T BE SERIOUS??????

            • xabier says:

              The creepy thing about the Glowing Globe pictures is that no-one is laughing, or looks as though are stiffling a laugh.

              I mean, that’s just not normal! I suppose this reaction shows why I didn’t suit corporate life…..

            • I wanted to suggest they rolled up one trouser leg as part of the ritual

              then realised that the Arabs can’t do that

            • Buzz Lightyear says:

              Norm, you mean there’s nothing under there… at all… oh sweet baby jesus no

          • i thought everybody knew that

            its their way of casting a spell so that their womenfolk will find them desirable.

            the don is hoping for a piece of the action with melania—especially since she gave him the drop dead when they got off AF one yesterday

            if it works i hope she’s gentle with him—otherwise he gets a purple heart for being killed in the line of duty, and we get Pence as potus

            • Fast Eddy says:

              The real meaning of the sphere had little to do with the occult.

              The occasion was the opening of a new Global Center for Combating Extremist Ideology, based in Riyadh, and the orb was in fact a translucent globe, with the world’s waters represented in light gray and the continents in black. Its purpose appeared to be decorative.

              The futuristic look of the darkened room may have helped to fire observers’ imaginations.

              It was filled with computer terminals. At one end was a wall of monitors displaying feeds from news networks. Employees of the center were segregated by gender, as is common in Saudi Arabia.

              The design felt to a pool reporter who was present like a hybrid of a game-show set and a television thriller’s idea of a counterterrorism operations control room.

              Among the many dignitaries at the event were Mr. Trump’s daughter Ivanka and her husband, Jared Kushner, and the Saudi crown prince, Mohammed bin Nayef.

              The globe did not appear to have any magical powers, but when the king and Mr. Trump touched it, background music of the kind that might accompany a reality show’s elimination sequence or introduce a cable news program soared and pulsed. The screens glowed with statistical displays and videos about fighting terrorism. An unnamed official who narrated the features of the new control center said the displays used artificial intelligence to track, in real time, news reports and online statements.

              “This groundbreaking new center represents a clear declaration that Muslim-majority countries must take the lead in combating radicalization, and I want to express our gratitude to King Salman for this strong demonstration of leadership,” Mr. Trump said in his prepared remarks.

            • In a way, I think that government powers are trying to show that they are all powerful. There is no need for another religion; with computer systems and all the data that it is possible to collect, governments around the world can do anything.

          • Fast Eddy says:

            Disco Ball?

    • Where is all of this stuff from?

      It sort of reminds me of Christine Lagarde’s 2014 numerology references.

  12. “Hamilton’s” Econimica blog, one of the best out there on cycles x demography x debt, just hit the digital heaven. The author in ultimate sardonic fashion wiped out the archive though, so google archive is not much of help since it stored only a few articles and not the most important ones, lolz. The end is nigh apparently.. or not ..

    • I haven’t noticed Hamilton writing much recently on oil-related issues. He is very much part of academia. I have never met him in person. He understands the high-priced oil issue, but I am not sure that he has a corresponding understanding of how low-priced commodities of all kinds affect the system. He tends to do the kind of modeling economists do. This approach is not necessarily very adaptable to changing circumstances. I notice from his biography that he is 62 years old. I suppose he could be retiring from doing this kind of work.

  13. Harry Gibbs says:

    An unusually sensible assessment of future oil demand/prices:


    “OPEC supply cut extensions will only serve to maintain the status quo at best because of ramping U.S. production.

    “Chinese oil demand forecasts are likely to be downgraded as the economy of China experiences a hard-landing and manufacturing enters a contraction.

    “The Fed’s interest rate and balance sheet normalization plan while facing global headwinds will push the U.S. dollar higher.

    “Elevated inventories, lower demand, currency effects and rising U.S. rig counts will push back the rebalancing. Oil in the $30 to $40 per barrel range is more likely than $65.

    “As oil prices decline again, global production investment will reach a complete halt, creating supply shortages in the long run.”


    • Bergen Johnson says:

      Yet, there are other articles suggesting oil price will rise in 2017.


      “Upside risks to NYMEX WTI prices are increasing with each contract roll that brings the driving season closer. That driving season will dominate the headlines, support price increases engendered by fundamental demand and trigger additional technical buy signals. These factors are likely to send oil prices significantly higher ahead of and during the summer — even if it is tough to imagine now, in the dead of winter.”

      The tale of the tape will be what actually occurs as opposed to endless up or down price conjecture by a media paid to come up with something to write.

      • Harry Gibbs says:

        Yes, but that^^^ is not an unusually sensible assessment, at least in my opinion.

        The SeekingAlpha author understands that Fed tightening thence stronger $ and Chinese slowdowns (or potentially worse) are key to falling oil prices, although whether and to what extent we see those in 2017 remains to be seen. I agree with him that a Chinese hard landing is inevitable at some point though.

        The Bloomberg article focuses on the US driving season as a likely elevator of prices but it did not move the needle last year so why the expectation that it will this? Also demand for autos is wavering in the US and there will be self-imposed closures at auto-factories this summer. US consumers do not look to be a particularly robust supporter of oil prices moving forward.

  14. Bergen Johnson says:


    Trump bringing on cruel austerity for the poor as his new budget will cut Medicaid 800 billion over ten years as well as cuts to food stamps and other programs that help the poor.

    • Bergen Johnson says:

      Yeah, more like ‘it’s’ alive, but like Rubio said yesterday, this is what people voted for. They could see his unpredictable, aggressive style during the campaign, so it shouldn’t be a surprise. It’s like the old saying, ‘Be careful what you ask for.”

  15. CTG says:


    Actually I do not have much confidence in “Elders”, “politicians”, “deep state’ or any authorities to do the right things at the right time. We are all sitting on a large stockpile of nitroglycerine and everyone is playing with matches or juggling torches

    As someone mentioned earlier… if the “smartest” person (Stephen Hawking) is delusional (someone with physics background), then what else can we expect?

    • Fast Eddy says:

      I suspect that hawkings has been approached and asked to help calm the sheeple by making comments in support of space colonies…

      Elon Musk would also be performing a similar role

      • CTG says:

        I have met many super rich people and they are dumb. Real dumb. Over 1-2 generations, they are really out of touch with the real world. They have no idea about anything at all because his father is rich and his grandfather is also rich. They need not be smart at all. In fact, I know a rich Indonesia guy whose son wanted to study in top universities in USA. He could not make the grade and his dad “donated” an entire building so that his son can get into that school. The son is now probably 40-50 years old. He knows nothing because he is sure to graduate from the school (does not matter if the grades are bad). I am not sure but I am not surprised he partied everyday in university. He comes out and take over his father’s business. As he was born rich, he does not even need to know that chicken lays eggs and that you need to service your car every x number of miles. He does not need to touch money as everything is by credit card or the secretary will settle his bill or book his flight tickets. Same goes for all the rich and elite in every part of the world.

        The ones that know best is the founder of the company where he has to work hard for it. The next generation is not great anymore. The grandchildren and great-grandchildren are plain dumb and will spend all the money. This transcends all culture, race and religion. This is human nature. They is why we have “The Fourth Turning” every 80 years.

        So, after all my interactions with the rich and super rich, I have no hope that they are smarter than the person in the street. They are so totally detached that serious, they have totally no clue at all about supply chain or anything. They just want to “party” and ” have fun”.

        As for scientists, I know some who have such blinders on their eyes that they know nothing except their field and in their field, they know only their specialization and nothing else. They have no intention to broaden their fields. They are so focused that they don’t even know that there is such a thing called “the big picture”.

        Musk, etc – I doubt that he has been “told” to do it because there is no such “person” as “they”. There is no “they”. The higher the food chain or management chain you go, the more “people think they are invincible” and nothing bad will happen to them. Cognitive dissonance is so strong that it delivers a knockout blow. The best phrase they will say is “Naw… someone else will think of solving this problem..” or “I am sure the people are working on this”. Remember that if you email to a whole list of people and asking them to do some work and put in the salutation as “Dear all”, you will never get the work done.

        To me, this is the big picture. The biggest of the big picture because you will hear people say “Aw, Musk will solve those for us” or “I am sure the scientist would have come out with synthetic gasoline soon” or “It is still far away in the future, let us have a party first”.

        In hindsight, there were many warnings for the captain of the Titanic when she struck the iceberg but because of the entrenched ‘cognitive dissonance” that it was unsinkable, he killed the messengers (metaphorically). If he has gone down to see for his own eyes, we would not have the tragedy of the Titanic and history would be significantly altered.

    • xabier says:

      And the people playing with the matches believe that they are themselves wearing fire-proof suits: highly embedded in privileged networks, they are too distant from the reality of common life and untouched by the consequences of most of their actions so far.

      I’ve found it rather soothing to watch those videos of glaciers calving on a massive scale: contemplation material for the Age of Collapse!

      • Speaking of ice, warning “BAU-lite delusions incoming”, lolz, the Germans seem to pursuit now the often forgotten third option of ground heat pumps general design, “the ice” energy storage, mostly used as winter heating and summer climate control. Actually it’s some sort of salt mixture, you need approx 10m3 volume of such tank for displacement of 100liters of heating oil. Usually, family sized home has got few thousands liters sized oil bunker per winter heating season. So, for the ice solution you would need then approx. ~10-50x 10m3 ice bunker (with the spiral piping inside). Which is not that much unrealistic nowadays in the era of prefab concrete assembly structures and tiny – neighborhood friendly excavators.

        Apart from household sized installations they are now operating several large pilot projects with thousands m3 sized ice storage systems for entire neighborhoods, larger housing projects etc. Obviously, you need the sunshine/hot air and extra electricity to feed such monster. And capital intensive (front loaded) it is yes. The supposedly mentioned advantage is the ~15+ yrs longevity of the system, ~50% eff. gain over traditional heating. As long as money are free (for someone) they will be constructed, mass scale adoption is obviously a different thing.

        • JT Roberts says:

          That’s just a thermal mass device using phase change to enhance storage efficiency. Old news but when ones grasping at straws you keep grasping until they’re all pulled out.

          • Yes, you could perhaps buy one as odd curiosity and novelty perhaps 5-10yrs ago, but only very recently bigger corps went into it.. plus the the increasing number of pilot demo installations of various scale to research and or fine tune the details..

            I’d say it is placed somewhere on the ~5th best spot out of approx ~30 of systemic options, what can one install, if the conditions are right. It’s not so much special electronics heavy as most renewables and or infrastructure dependent as most oil/natgas/pellets/.. solutions. Obviously, as mentioned it’s very front-loaded on the initial investment, workload, and proper installation to get the longevity. The first places are occupied by zero electronics equipment exposure systems though (or JIT sensitive parts for first few decades of service). And the last-worst places on the list are the usual stuff all around us.

    • As I understand the situation, the UK plays an important role with respect to nuclear energy. It is the host country for Euratom, which provides nuclear services to the entire EU.


      “139.We asked our witnesses how the UK should seek to replace its membership of Euratom. Lord Hutton stressed the importance of avoiding a “cliff edge”—that is, the UK’s membership of Euratom coming to an end without a alternative arrangements having been put in place. He explained that this would mean that the UK could not go on trading in nuclear goods and services because it would be outwith the internationally recognised framework of nuclear safeguards.”

      “143.We note the Minister’s reassurances that the Government is devoting significant resources to maintaining and, potentially, even enhancing some of the benefits that the UK currently achieves from membership of Euratom. We echo Lord Hutton’s suggestion that the Government should convene a working group of industry and government representatives to develop a plan to preserve the essential benefits of Euratom.”

      144.There is a real urgency for Government action on this. The UK’s membership of Euratom must not be allowed to expire without a suitable replacement being in place. Such an eventuality would put the UK at risk of losing its lead in fusion research and in effect throw away decades of research. Furthermore it would put the UK at risk of losing access to the markets and skills it needs to construct new nuclear power plants and may leave existing stations unable to acquire fuel.


  16. Fast Eddy says:

    “Chapter 11s and Chapter 15s have exploded” said U.S. Bankruptcy Judge Shelley Chapman, speaking at American Bankruptcy Institute event, cited by Bloomberg reporter Tiffany Kary.

    The numbers for the bankruptcy court which serves Manhattan are, frankly, horrifying: Chapter 11s have tripled in the first quarter of the year, while Chapter 15s for companies seeking U.S. aid for a reorganization in a foreign court have increased sevenfold, Chapman added.

    The culprit? Take one guess:

    “The report is that for at least a lot of retailers, it is certainly a difficult, if not flat out impossible environment to operate in,” Shannon said. “We do see more of those cases likely on the horizon.”

    And while we appreciate the transfer of business from bricks and mortar retail to online, it is simply impossible that the millions of soon to be laid off legacy retail, minimum-wage workers will find suitable employment in the coming retail bankruptcy tsunami (which will claim the following 11 names next according to Fitch), and which will unleash a tidal wave of bankruptcies first across New York, and soon after, across the entire US. How far this particular destructive tsunami of default will reach, and how fast, will determine just how acute the next recession will be.


    • This is a statement about Manhattan filings. I imagine the problem is a local increase in minimum wage, besides interest rate increases and the long-term shift toward on-line shopping.

  17. Interguru says:

    Good diagnostician

    Remember the global economy, the one that nearly collapsed in 2009? Well, it turns out that although we stabilized it, we never actually fixed it, and there is a very real danger that it is about to unwind all over again.

    That’s the sobering message delivered by the former governor of the Bank of England to a blue-chip gathering Tuesday evening at the Peterson Institute in Washington. Mervyn King — Lord King to his friends and countrymen — is the closest thing there is to a charter member of the global economic and financial elite, a Cambridge-trained economist who taught at Harvard, MIT and the London School of Economics before settling into a 26-year career at the world’s second-oldest central bank.

    Bad clinician

    As King sees it, as long as countries such as the United States and Britain continue to run large and persistent trade deficits while countries such as China and Germany continue to run large and persistent trade surpluses, the global economy and the global financial system will remain fundamentally unstable and susceptible to another crisis.

    Indeed, King warned, the only thing that is standing in the way of a painful day of reckoning is the willingness of the world’s major central banks to continue printing vast sums of money — money that has been loaned to investors who use it to bid up the prices of stocks, bonds and real estate well beyond their economic value, and money that has been loaned to consumers and governments, who use it to live beyond their means.


    • Except our problem is a lack of demand. Commodity prices are not high enough. It is hard to see how these changes will raise total demand.

    • Bergen Johnson says:

      Interguru, it’s not trade surpluses that caused the mortgage meltdown. It was a reduction in the parameters deciding loan approval, i.e. lier loans, and then those loan packages getting shopped around, and then at some massive threshold of defaulting loans it all came crashing down only for the big one’s most involved in the scheme getting bailed out to have parties and hand out bonuses.

  18. Fast Eddy says:

    Three former dairy workers with Idaho’s largest dairy operation have been charged with misdemeanor animal cruelty after undercover video shot by an animal rights group showed workers stomping, dragging and beating cows inside a milking barn.

    Watch Humans in Action: http://landing.newsinc.com/shared/video.html?vcid=23841440&freewheel=90051&sitesection=nydailynews

    That’s what an Idaho “Ag Gag” law did; made it illegal to take photographs or videos on private property without permission from the owner. It also made it illegal to gain access to private property through misrepresentation, for instance an undercover reporter seeking a job. Violation of the law was punishable by a year in prison and/ or $5,000 fine.

    The law was drafted and sponsored by The Idaho Dairymen’s Association after a video came out showing horrible abuse of cows at a dairy in Hansen Idaho. The video was taken by an employee of Mercy for Animals conducting an undercover investigation.

    The bill quickly passed the legislature and was signed by the governor, but was then struck down on the grounds that it violated free speech, and equal protection for employees who may be ensnared attempting to document unsafe working conditions.

    The state appealed, and now the the courts will decide whether or not to reinstate the law.


    Death to All Humans. Urgent.

    • xabier says:

      Weakness and powerlessness always attract cruelty when there are no real safeguards: UN guards raping and enslaving in camps; abusers staffing orphanages; nuns murdering illegitimate babies and starving the mothers (Ireland) and in Spain we even had dog-abusers setting up a fake dog refuge and killing the dogs slowly with cheap poison, they took many hours to die and they played loud music to cover up the howls and groans – just the sort of people who would line up to staff death camps!

      Still, best not to think about such things, as they sap the will to live.

      And best to have a plan so as never to fall into the power of other humans.

      • I’ve said for a long time, that pre-total collapse there will be martial law, and inevitable camps set up to incarcerate dissenters.

        There will be no shortage of people willing to staff those camps

        • T.Y. says:

          A while ago i played “The last of us”, a PS3 game. Just to get a feel for what collapse would be like. It starts off with some sort of fungal disease (broadly inspired on cordyceps lifecycle, an real fungus that takes over ants). so essentially you got infectious “zombies”, bands of plundering survivors and bands of ex-law enforcement that keep martial law to their controlled sections. All which are hostile to you. The main character makes a living as smuggler (getting things in and out of controlled zones) and needs to get a girl (which appears immune) to a rebelling faction.

          Some lessons from the game (i can’t vouch for their real life applicability though):
          1. Your best to avoid all contact
          2. If avoidance is not possible (usually the case because the game would not be any challenge otherwise) outright attack is the last and worst option because you can typically expect to be outnumbered and outgunned. Additionally a target rushing towards an enemy is easier to hit than one running away from them and you are likely to not just alert the one guard but get all his friends on your neck as well.
          3. In case you have not been detected yet, try to get them to spread out and SILENTLY take them out of action one by one. Think knives. Bows & arrows are surprisingly handy since you can recycle ammunition. (in real life i doubt you could sneak up close enough to pull this off, but hey…)
          4. In case you cannot get them to spread out, create a diversion and try to rush for a safe place ASAP
          5. If you really must attack directly, try to scout so you know the numbers you’re up against and for gods sake keep count. Better make you sure you have ample ammunition, because in the stress of the situation you ARE GOING TO MISS REPEATEDLY and keep in mind that a “one shot = one down” is only in the most “ideal” of situations. Know that the tide in such a “hot fight” turns in the blink of an eye and know that when it does, you best have some plan of where you’re going to run to.

          • Van Kent says:


            I can just picture the millenials in the cities looking for cool Norman Reedus crossbows and going out on the prowl..

            I mean if you extrapolate that comment, what it means for big cities with millions of people.. The cities with these sort of millenials will become total hellholes, instantly. Everybody shooting the hell out of everybody else. While the guys who played other games, will be sniping out of highrises. Just because they did it in games, it might sound like a good idea when the grid goes down. And if one group does it, then will everybody else also catch on?

            I just thought maybe it would be a bit calmer, for a while, before the shooting starts. But that comment scared the bejheezus out of me.

            I thought it would maybe go more like this:

            • Fast Eddy says:

              So the grocery stores will empty in a matter of hours.

              Humans are rather rather clever beasts…. when they realize the shops are empty — does anyone thing they are going to stick around in the cities for long — fighting each other — over some useless buildings?

              Of course not.

              They will be loading themselves into cars and heading for the places where they expect food to be available. They will be rolling into the countryside….. to the farming areas…. to where the doomsday preppers are….

              Work out how many people are within a half a tank of gas of your position.

              Work out how many people are within an hour’s walk of your position.

              And then determine if you think you can feed all those people when they arrive.

            • Buzz Lightyear says:

              Or like this…

            • T.Y. says:

              Van Kent,

              I’m in no way advocating that you should get yourself a “cool looking crossbow” and “start shooting the hell out of everybody else” once the grid goes down. In fact i’m advocating to avoid such scenarios (Rule n. 1 avoid all contact). But you need to be realistic as well; there will be various well armed gangs, in such case do what you must , but try to do it without drawing attention to yourselves seems like a good idea.

              Are you aware that the link you posted literally mentions street wars ??
              “we organized patrols (5 armed man every night) to watch on gangs or enemies.
              We traded things between people in that street, 5 miles from my street there was one street with something like organized traders, but it was to dangerous to go there, it worked only during the nighttime (during the day it was sniper alley)”

              There is probably some “mileage” between the grid going down and total post-apocalyptic survival Although i tend to agree with FE & TE that it will probably go fairly quickly once the “levee” breaks proper.

              As an aside, i also anticipate that various people will start blaming various others, your comment about “these sort of millennials” is duly noted; i suggest you keep in mind that the world got the way it was under your watch as well, and a lot of awful shit happened regardless….

          • Fast Eddy says:

            I am reading The Forever War https://www.audible.com/pd/History/The-Forever-War-Audiobook/B002V8KIGU

            I had read Ghost Wars a few years ago … and it described the situation in Afghanistan when the Soviets left…

            There was no martial law — there was no central authority — Kabul was busted into pieces each controlled by vicious gangs.

            If you wanted to walk down a street you paid the gang that controlled that street/neighbourhood.

            Forever Wars confirms this …. but adds a new dimension … it was apparently common for gangs to rape women….

            I have not read that anyone was starving in Afghanistan (of course the country was not collapsed…. it was still plugged into BAU) so nobody was hunting down children for meat….

            You will want to be dead before it gets to this.

          • Buzz Lightyear says:

            Amazing game… haunting post apocalyptic imagery


            I particularly like the remnants of military checkpoints and medical camps that obviously didn’t last very long

            There’s an interesting storyline within the game that revolves around getting a hydroelctric power plant working again… which they manage to do!

            Quite laughable really looking back at it but in make believe land anything can happen I guess

            In case you’re wondering…

            Cordyceps is a genus of ascomycete fungi that includes about 400 species. All Cordyceps species are endoparasitoids, parasitic mainly on insects and other arthropods; a few are parasitic on other fungi.


            And yes… people eat them

            • T.Y. says:

              i particularly liked the cordyceps-concept of the story. By the way: did you know there are also ants that do the inverse ; they farm a fungus in their nest for food !

              One thing that was also an eye-opener was the scene were this one guy posed like he was a beggar needing help, while his mates were waiting in ambush. That sort of thing is not something one can easily imagine from the comfort of a western house…..
              (Van Kent; this was also an active strategy by some during the Bosnian siege you refer to)

      • Fast Eddy says:

        It’s a wake up call to Koombayaists…. one must have a Plan to avoid the guaranteed monstrosities that will emerge when BAU goes.

        Attention DD Preppers – you will not be left alone to enjoy your organic oats…

        • T.Y. says:

          Any news on the Cyanide-infused chocolate bunnies ?

          • Fast Eddy says:

            Or perhaps a nice single malt infused with sodium pentobarbital

            And for the Koombayaists… organic oatmeal with a dash of same….

    • JT Roberts says:

      That builds a pretty good case for genetic regression. The belief that mutations are cyclical with an upward bias is the same as mainstream economics. Blind Faith is not Faith it is credulity. Faith is built on evidence.

  19. Fast Eddy says:

    If this bill passes Congress however, hundreds of billions of currently delinquent student loans, potentially as much as $1.4 trillion worth of student loan debt…


    • I would guess that if the loans were forgiven, the big impact would be to increase the US government’s net debt, and to decrease individual student’s debt. As I understand it, US debt is now computed with an offset with receivables for student loans. If these receivables disappear, US debt will be higher.

      I suppose that this is as good a way as any to allow the problem to disappear. Young people can start to get their lives back. The problem still exists for all of the new students who want to get university educations, and need to take out loans. What happens to these loans? Are these to be forgiven as well? No private institution would be willing to take such a risk. It is doubtful that the US government can keep adding debt for student loans–but maybe it can. It would serve as good as purpose as any. Young people are the ones having a terrible time.

      • Fast Eddy says:

        If I am about to go to uni… I am looking at this … and I am applying for as many loans as I can possibly get my hands on …

        And I am booking the Spring Break VIP Package for next year…

        This is what you call moral hazard…..

    • JT Roberts says:

      This could have unintended consequences related to perceived solvency.


      If there is a run to alternative currency such as China or Russia the US will certainly handle the situation as it did in Iraq and Libya.

  20. jeremy890 says:

    More Debt…moar, moar moar…How do you like it?

    According to the South China Morning Post on May 12, “Philippine Secretary of Budget and Management Benjamin Diokno estimated some US$167 billion would be spent on infrastructure during Duterte’s six-year term, under the slogan ‘Build! Build! Build!’.” That could increase current Philippine national government debt of approximately $123 billion, to $290 billion. But that does not include interest. High rates of interest that China, the most likely lender, could impose on the new debt could balloon it to over a trillion U.S. dollars in 10 years. More likely according to my analysis, at 10% interest the new debt could go to $452 billion, bringing Philippines’ debt:GDP ratio to 197%, second-to-worst in the world. That understates the burden to the Philippines, as existing national government debt would also accrue interest over that time, and such interest was not included in the analysis. Dutertenomics, fueled by expensive loans from China, will put the Philippines into virtual debt bondage if allowed to proceed.


    Money is like Love…best when it is spread around

  21. Fast Eddy says:

    F789 Donald Trump!


    I am struggling with this… heck he doesn’t even have a war under his belt yet and the knives are out….


  22. Fast Eddy says:

    When petrol is too expensive … you just cut the costs by stealing it and selling it on the black market


  23. Fast Eddy says:

    Cathay Pacific just laid off 600 people…a lot of senior management.

    They blame this on competition…. and fewer people flying business class — where most of the profits are…

    I would imagine that the latter has more to do with these massive losses than competition … banks are not hiring in HK — there is less investment banking activity … lots of layoffs…. and that translates into losses for CX.

    I am also in close contact with the restaurant industry in Hong Kong — they are hurting — and they indicate one of the main reasons is ‘fewer bankers and other business people slapping down company cards’


  24. JT Roberts says:

    Here’s a good study on energy subsidies. Turns out solar PV gets $876.00 per megawatt. Once again a fossil fuel dependent product.


    • Thanks! I am on Carey King’s e-mail distribution list (one of the authors of the report) so I should have received it and looked at it earlier. But it helps to look at it more closely. I see the report says about subsidies:

      Coal receives $0.54-$1.09/MWh, hydrocarbons [natural gas+oil] $0.87-1.19/MWh, and nuclear $1.30-2.16/MWh. By contrast, wind received $57/MWh in 2010, $34 in 2013, and is expected to receive about $13 in 2016 and about $15 in 2019. The higher level of subsidy in 2010 and 2013 is explained by the ARRA funding. The contrast is even more striking with solar: $876/MWh in 2010 and $667/MWh in 2013 versus $99/MWh and $71/ MWh in 2016 and 2019, respectively.

      So the solar amount is coming down, but is still very high at $99/MWh in 2016. These are simply federal subsidies, not state and local subsidies. These subsidies also do not reflect indirect costs passed on to other electricity providers or to grid companies, in terms of having to provide backup support to intermittent renewables. They also do not reflect the problem with artificially low electricity prices caused by adding intermittent electricity to the grid, and the resulting loss of needed production by other types of electricity producers (particularly nuclear and coal). We are only beginning to experience this impact.

  25. ITEOTWAWKI says:

    IC needs soooooo many inputs….I see this video clip now in such a different way then when it came out over 15 years ago (when I was still in the matrix)…the song and video clip are still great though!!

  26. Third World person says:

    after seeing trump and Bannon in saudi arabia it make me laugh that for money they will forget
    ideology of hating Muslims especially bannon who say that christian needed own militants to fight extremist Muslims

    • jerry says:

      Does one remember the slaughter of three kidnapped 16 year old Christian schoolgirls by a Hasnaduanns and his followers in Indonesia. They killed those poor children by chopping off their heads and if I remember correctly it was a gift to God?

  27. dunno what you’re all worrying about


    the cleverest man in the world has supplied the answer to all our problems.

    • grayfox says:

      It sounds almost like a reasonable proposition, but really not a lot different than the Heavens Gate cult scenario that enthralled us some time ago.

    • Kurt says:

      What planet is he talking about? Mars? I don’t think so. Maybe something a couple of hundred light years away? Oh sure, that’s doable. Much easier than Mars.

    • ITEOTWAWKI says:

      Haha Norman, I posted something similar a couple of months ago here on OFW, saying that even Hawking, one of the greatest minds alive right now is delusional…I don’t think anything in the universe has ever reached interstellar voyaging since any sentient beings elsewhere (if they exist in the first place) will have fallen in the same trap that we have…the use of your resources at hand to develop your Industrial Society collapses when said resources are exhausted or you completely destroy your biosphere (or as in our case your financial system collapses under its on weight, if they had one to kick off their IC like we have), wayyyyyy before they reach that level…the Kardashev scale is BS IMHO..

      Paul Chefurka sums it up rather nicely in one of his blog entries:

      A Thermodynamic Answer to Fermi’s Paradox


      • JT Roberts says:

        Interesting but it ignores the fact that radio waves would still be detectable. Just a convenient way to explain the failure to find life outside of earths atmosphere.

        • ITEOTWAWKI says:

          So maybe then we truly are the only sentient beings in the whole universe…

          • psile says:

            Life may well be abundant in the universe, I mean, look at how huge it is! However I remember reading a paper many years back about the 11 increasingly improbable steps, leaps and happy coincidences that lead to the evolution of complex lifeforms on this planet, which leads me to conclude that whatever life there may exist elsewhere in the cosmos is probably of the very mundane and what we chauvinistic humans would consider the “not too bright” sort.

            Bully for them!

            • ITEOTWAWKI says:

              Exactly psile…I had read something along similar lines…but that there is a form of life somewhere, that I don’t doubt…but sentience is not a necessarily automatic outcome of evolution…if that asteroid had not hit 65M years ago, dinosaurs would still probably be roaming the earth without any sentience whatsoever, and we would still be little rodents 🙂

            • Buzz Lightyear says:

              Nit pick time…

              Dinosaurs had feelings to…

              adjective: sentient

              able to perceive or feel things.
              “she had been instructed from birth in the equality of all sentient life forms”
              synonyms: feeling, capable of feeling, living, live; More

            • ITEOTWAWKI says:

              Buzz, you’re right I did not express myself correctly…I meant more from the following point of view (I found it on livescience):

              1. Generative computation

              Humans can generate a practically limitless variety of words and concepts. We do so through two modes of operation recursive and combinatorial. The recursive operation allows us to apply a learned rule to create new expressions. In combinatorial operations, we mix different learned elements to create a new concept.

              2. Promiscuous combination of ideas

              “Promiscuous combination of ideas,” Hauser explained, “allows the mingling of different domains of knowledge such as art, sex, space, causality and friendship thereby generating new laws, social relationships and technologies.”

              3. Mental symbols

              Mental symbols are our way of encoding sensory experiences. They form the basis of our complex systems of language and communication. We may choose to keep our mental symbols to ourselves, or represent them to others using words or pictures.

              4. Abstract thought

              Abstract thought is the contemplation of things beyond what we can sense.

              “This is not to say that our mental faculties sprang fully formed out of nowhere,” Hauser wrote. “Researchers have found some of the building blocks of human cognition in other species. But these building blocks make up only the cement foot print of the skyscraper that is the human mind. The evolutionary origins of our cognitive abilities thus remain rather hazy. Clarity is emerging from novel insights and experimental technologies, however.”


            • Buzz Lightyear says:

              After 2,500 Studies, It’s Time to Declare Animal Sentience Proven


              Scientists know that individuals from a wide variety of species experience emotions ranging from joy and happiness to deep sadness, grief, and post-traumatic stress disorder, along with empathy, jealousy and resentment

              I’ve used sentience and Sentients artistically in the way you mention as part of fictional narratives while twisting the meaning to suit the plot but we are no more sentient really than chickens… more intelligent possibly

          • JT Roberts says:

            Scariest thought of the day.

      • MM says:

        I would add the following claim:
        The “design” of evolution holds a trap for species that are not compatible with being intergalagtic. It might be necessary that you do not destroy everything on your path and kill everything under the right 2 protect of another planetary culture for not being congruent to your ideas.
        But every biologist might say that Evolution does not have a plan…
        Our civlisation also has no plan. It simply grows to it’s death so why bother 🙂

    • Dorvek says:

      Dont know what upsets you
      Were gonna take you to the outer space
      Find planets red, blue
      Lets make a universal race

    • JT Roberts says:

      At his age he may just be reverting to his youth. Too much SciFi no doubt. It’s a protection mechanism.

      • Buzz Lightyear says:

        A lot of people suffering from “too much scifi” syndrome. Myself included.

        For more people than ever it has become a religion mimicking rapture and ascension but will emphatically shrug off the comparison

    • Ed says:

      Hawking was we need more planets because we are running out of space on Earth. Has he forgotten about exponential growth? It is not too little space it is too many people.

    • greg machala says:

      I read that. So bizarre. Surely the man knows better than that article suggests. Supposedly we have only 100 years left (down from 1000 years from earlier thinking). I just don’t get the logic. If we have 100 years left with all the vast resources of this planet, how do we have anything more than a few minutes of life on another planet devoid of all resources including water and air? Assuming we can even get there.

      • Theophilus says:

        Excellent point

      • JT Roberts says:

        Exactly since the earth is in a path to becoming a lifeless plant like Mars why by a ticket. Just sit back and wait if we think it’s so great. As someone has commented why not go live in a cave now.

  28. Pingback: Economische ‘groei’ staat haaks op onze duurzame samenleving? | The Logic Free Zone

  29. Fast Eddy says:

    The ultimate consequences of endless stimulus:

  30. Fast Eddy says:

    Oops, this Wasn’t Supposed to Occur in a Rosy Credit Scenario

    It’s always associated with a recession: last time, the Financial Crisis.

    Over the past five decades, each time commercial and industrial loan balances at US banks shrank or stalled as companies cut back or as banks tightened their lending standards in reaction to the economy they found themselves in, a recession was either already in progress or would start soon. There has been no exception since the 1960s. Last time this happened was during the Financial Crisis.

    Now it’s happening again – with a 1990/91 recession twist.

    Commercial and industrial loans outstanding fell to $2.095 trillion on May 10, according to the Fed’s Board of Governors weekly report on Friday. That’s down 4.5% from the peak on November 16, 2016. It’s below the level of outstanding C&I loans on October 19. And it marks the 30th week in a row of no growth in C&I loans.

    C&I loans are tightly connected to the real economy. They’re an indication of what businesses are up to, from a shop needing a loan to buy a piece of equipment to the multinational funding its receivables. C&I loans show whether companies in aggregate are expanding their needs and activities or whether they’re curtailing them.

    The chart below shows how any significant decline of C&I loans outstanding in the debt-addicted US economy is associated with recessions. Note the turning points:




    • I agree! This does look worrying! If businesses aren’t borrowing, we have a problem.

    • doomphd says:

      that loans over time plot is very convincing. it predicts that we are either already in recession and it is being covered up or we will soon be in one. the progressive amplitude of the peaks is also impressive, suggesting “the mother of all recessions” is coming.

      • Fast Eddy says:

        We Now Know “Who Hit The Brakes” As Loan Creation Crashes To Six Year Low

        And while C&I loans are tumbling, demand for credit cards is now running at the lowest level in the 5 years the survey has provided credit- card-only data for consumer demand.

        With all that, we can now close the book on the WSJ’s previously unanswered question of “who hit the breaks?” The answer: the US consumer, the driver behind 70% of US GDP, officially tapped out.


        • What surprises me is that historical growth rates have been as high as they have been. Annual increases in debt of 8% or 10%, shown on the charts linked, are clearly unsustainable. C&I loans are now increasing at 2% per year. In some sense, that is close to a sustainable rate, if wage inflation is about at that level.

          Unfortunately, our economy really needs the high debt growth rates.

  31. jerry says:

    here’s something to make one think:

    Saudi Arabia on the one hand is looking to spend 1.15 billion dollars on military equipment


    and yet on the other hand is pleading for the US to stop pumping so much oil because it is hurting the price of oil and thus their giant welfare state of an economy?



    • In short, Saudi Arabia uses oil money to keep its citizens in line…

    But this scheme isn’t cheap. According to the International Monetary Fund (IMF), Saudi Arabia needs oil to trade north of $86 a barrel to balance its budget.

    That’s nearly double the current oil price.

    This is creating big problems for the Saudi kingdom. In 2015, the Saudis posted a record $98 billion deficit. That was equal to about 15% of the country’s annual economic output.

    Last year, it ran another $79 billion deficit.

    • Saudi Arabia is now desperately trying to restore its finances…

    It’s slashed its government subsidies. It’s borrowed billions of dollars. It’s even trying to reinvent its oil-addicted economy.

    Gail care to comment?

    • The question isn’t regarding how much it casts a company to eat tract oil from the ground. The question is, “How high a price is needed, so the government of Saudi Arabia can get enough funds for all of its programs, as well as the oil company getting enough money for all of its needs, including reinvestment?” This amount is likely more than $86 per barrel. In fact, it is probably over $100 per barrel. Users of oil products (such as farmers) cannot afford to use oil that is so high priced, because then their products (food) become too high priced for consumers.

      The whole situation cannot work out well. Prices that are high enough for Saudi Arabia are too high for consumers.

      • doomphd says:

        note to Gail: your automatic spell checker is betraying you. unfortunately, you now have to carefully proofread to catch all the correctly-spelled words that have incorrect meaning. OTOH, it does provide amusement for the reader to decipher what you really meant to type, as in your post above, e.g., casts = costs, eat tract = extract. progress.

    • Jesse James says:

      I have heard that Saudi Aramco is laying off. This is inprecedented. Saudi is in deep trouble budgetwise.