I am putting this post up to give commenters who would like to carry on conversations related to previous posts a place to comment, since comments on my last post have been cut off.
Also, my family and I recently returned from a two-week vacation to Japan. The combination of the time away and jet lag has given me less time to research and write a full article. Here are a few observations, based on my recent trip to Japan:
General
The scenery is beautiful, but it is clear that the Japanese people and agriculture are squeezed into the small amount of land that is not mountainous and forested.
The amount of land being used for agriculture has been steadily falling. Our tour guide remarked that if an older person wanted to leave agriculture, getting solar panels installed is an alternate way of obtaining income. We did see quite a few solar panels. But does this approach make sense, when the amount of land farmed is relatively small and falling year-by-year? The USDA says, “Based on total calories consumed, Japan imports about 60 percent of its food each year.”
Tokyo-Edo Museum Visit
When we first arrived in Tokyo, before our bus tour began, we visited the Tokyo-Edo museum. This is a photo of one of the exhibits from the museum.
In previous posts, I have talked about economies being dissipative structures–growing for a fairly long period, before collapsing or obtaining an infusion of cheap energy. I thought that it was interesting that the Edo Period lasted 265 years (1603 – 1868). This is about as long as a person might expect an economy to last in its role as a dissipative structure. In the latter part of the Edo Period, there seemed to be increasing wealth disparity and problems with the government collecting enough taxes. These are things that we would expect to happen, as resources per capita start to fall and complexity starts to increase.
Free English Language Guided Tour of Museum
The three of us (my husband, son, and I) received a free three-hour English language guided tour from a volunteer guide at the Tokyo-Edo Museum. The guide told us that he is a 75-year old retired business man. There was no charge for his services; we were also told not to tip people in Japan.
My impression is that the no-tipping policy is a holdover from the gift economy approach that much of the world used before our current capitalist approach took over. Under the gift economy approach, people are expected to offer their services for nothing, with the expectation that others will reciprocate. This system has pluses and minuses. If pensions of some elderly people are inadequate, it makes it harder for them to provide personal services for wages, since others (with more adequate pensions) will do the same thing for free, as unpaid volunteers.
Traveling School Children
Everywhere we traveled, we encountered a large number of school children traveling on school trips. They often stayed at the same hotels as we did and visited the same sites as we did. In fact, in several places they seemed to be the majority of hotel guests.
The group of children shown above had prepared some type of recitation and response to be offered in the Hiroshima Peace Park. The group is lined up for their presentation, even though there was no real audience for their performance, other than a few of us from our tour bus who happened to be walking by. I can’t imagine US children doing this.
Our tour leader told us that only children whose parents can afford to pay for these class trips are allowed to go. As a result, there is a great deal of pressure on parents to save up money for these trips.
Roads in Japan
The roads in Japan impressed me as being incredibly expensive to build and maintain. Everywhere, we saw walls built along the side of the road, presumably to prevent falling rock. In the US, we just put up signs, “Beware of Falling [really fallen] Rock.” Of course, we have more space, so we don’t build our roads quite so close to the road cuts.
The white line near the side of the road is to mark off what I would call a “sidewalk substitute.” It is a low-cost way of giving pedestrians a little space to walk.
We saw other features that make roads expensive. Our tour bus drove through countless tunnels. We also drove on many sections where the road was elevated, so that more roads could be squeezed into less area.
Nearly everywhere, soundproofing panels have been added because roads are so close to buildings. Roads are being made in an earthquake-proof manner, which also adds to costs.
Our bus frequently drove through toll stations. Wikipedia indicates that most expressways were originally financed by debt, and the tolls are being collected to pay off this debt. The Japan Guide indicates to drive the length of Japan, toll payments of 39,000 yen ($349) are required for a private passenger automobile. This is expensive compared to tolls elsewhere.
Man Made Rocks
Something else I noticed in Japan that I hadn’t seen elsewhere was the use of man-made rocks. Here, they are being used to keep the sea from causing erosion under a major road that is very close to the edge of the sea. We saw other shapes of rocks being used for other purposes elsewhere.
Government Pensions in Japan
The National Pension program in Japan (somewhat equivalent to our Social Security) is based on the assumption that all participants in the program will make equal contributions to the program, regardless of income. In 2017, these contributions amount to 16,490 yen (or $147) per month. To get the maximum pension amount, a person has to contribute at the full level (whatever it is declared to be, each year) for 40 years.
Our bus tour guide told us that because of changing employers and resulting low income, he has been unable to make contributions in recent years. When he retires, he expects that his pension payments will be very low because of this. He seemed to be well educated and hardworking. If he is having pension problems, I expect that many others are also having pension problems. In fact, some may be having pension problems today. We saw quite a few older people working.
Bullet Trains in Japan
One thing we discovered is that Japan’s bullet trains are for people, not luggage. The racks over people’s heads hold a backpack or brief case, but not much more. If people have luggage, they generally send it a day or two ahead of time via a luggage transfer service. There is also no internet service available on these bullet trains.
We chose to take an airplane from Osaka to Tokyo. Airplanes will transfer both people and luggage.
Photo in Kotohira, Japan
This is a photo of my husband, son, and me, after we had climbed 865 steps to a shrine in Kotohira, Japan. We had a good but tiring trip.
US SHALE OIL PEAK 2020
As for the most immediate issue:Wood Mackensie report on Shale oil profitability
https://www.woodmac.com/analysis/preFID-oil-projects
global upstream capital spend reductions of 22% or US$740 billion from 2015 out to 2020 over 20 million b/d needs to be developed by 2025 to offset production declines from existing fields and meet future demand growth [chart: only 3-5 Mmbbl/d of future US shale oil are profitable at $50] Average WTI oil price during the last 12 months: $51.16
This is the key element that the markets overlooks: HSBC 2016 oil report.
https://drive.google.com/file/d/0B9wSgViWVAfzUEgzMlBfR3UxNDg/view
Key quotes:
Based on our oil supply model, we estimate that ~81% of world oil supply (crude and NGLs)
is post-peak. However, a less restrictive definition of “post-peak production” can be
used, whereby we consider that fields which have previously peaked but will have a second
production peak (or redevelopment) in the future are not post-peak. Using the more benign
definition, we find that 64% of the world’s oil production is post-peak.
The UK’s average water cut [= ratio of water in produced oil] has risen from 68% in 2000
to 80% currently, while the average water cut in Norway has increased from 37% to 62%
currently.Although there might be some very near-term concerns about demand, the medium-term outlook to 2020e looks robust. [graph that implies 95-100 Mmbbl/d in 2020]
Increased production efficiency meant that existing assets delivered higher production
than expected, and helped to reduce decline rates.
If we believe BP’s guidance, there may well be a further 3-6 ppts upside in its portfolio
operational efficiency over the next several years. This would substantially mitigate
natural decline, as every 1 ppt improvement in production efficiency is broadly equivalent
to a 1 ppt reduction in its decline rate. However, a 3-6 ppt improvement needs to be put
into the context of a 13 ppts increase over the last 5 years.
Schlumberger: “[The] apparent resilience in production outside of OPEC and North America
is in many cases driven by producers opening the taps wide open to maximise cash flow,
which also means that we will likely see higher decline rates after these short-term
actions are exhausted.”
Ensco: “When oil prices went up above $80 or $100 a barrel, although a lot of headline
attention went to the big new field developments and the FID, what was happening that
people were doing a huge amount of in-field work. They were drilling infield wells,
recompleting old wells, drilling step-out wells. That has effectively stopped and, as a
consequence of that, we’re going to start to see, very rapidly, decline rates on existing
fields.”And, putting these puzzle pieces into the bigger picture:
IEA warns of oil ‘supply crunch’ by 2020 with no capex renaissance (March 2017).
http://www.reuters.com/article/us-oil-iea-forecast-idUSKBN16D1X1
“If prices remain closer to $50, shale output could fall from the early party of the next
decade.”the IEA said early indications of global spending this year were ‘not
encouraging'”.
Oil companies are already hurting since 2014.
http://news.goldseek.com/GoldSeek/1478268180.php
Because most of shale oil isn’t profitable right now, pressure on oil companies will
continue, and won’t be able to afford to build up their 20 Mmbbl/d in time. We’ll
realistically get 4 (see above).Another factor is the rising US key interest rate, which makes credit on new projects more expensive. So this $50 threshold may soon become $55.
Oh, and oil prices won’t be able to recover any time soon, because we can’t seem to escape
overproduction, and global storage levels are hitting all-time-highs.
https://orbitalinsight.com/solutions/world-oil-storage-index/
So, in summary:
overproduction -> low oil prices
low oil prices + low cash reserves + rising credit cost -> weak investment in new oil
projects , weak investment + higher than expected rates of decline -> decreasing supply
stable demand + decreasing supply -> peak [unconventional] oil in 2020
Over 200 oil and gas companies have filed for bankruptcy in the last two years.
http://www.haynesboone.com/~/media/files/energy_bankruptcy_reports/2017/2017_midstream_report_20170220.ashx
i want to ask ofw what are chance fed increase interest rate this month
Oil prices won’t rise anytime soon because we can’t seem to escape overproduction.
https://orbitalinsight.com/solutions/world-oil-storage-index/
I remember reading about this group before. They claim to be able to look at oil stored in China, for example.
The chart using their own index ends at an earlier date than the EIA data, so it is not clear to me that they are getting information out faster. Their data may eventually show a downturn–they just don’t have up to date data, or are averaging amounts back in such a way that it is hard to see downturns. Or maybe they have more detail data to sell, for those willing to pay for it.
I am not convinced that we can tell anything from the chart shown.
University of Wisconsin begins offering free tampons in the MEN’S bathrooms
http://www.dailymail.co.uk/news/article-4418590/University-Wisconsin-offers-free-tampons-men-s-room.html
Oh great the sight of a bull dyke getting a tampon in the men’s room.
How much consideration would be given to such trivialities such as this in a resource constrained world? I would bet it would be zero or less than zero. Gay marriage, trans-gender toilets, women’s rights, slavery, all these things and more would be non-debatable without sufficient resources and energy.
Just think of the energy expended in bathroom conversions, making new signs….. it’s all fossil-fueled self-indulgence.
If it was condoms…yes. I think they are confused
http://imgur.com/a/dVLhY
Gail, I know Japan quite well, so I will add some comment on your remarks (and also the European perspective will show).
– Several things that you’ve noticed reflect more than anything else on the fact that the construction lobby is the most powerful lobby in Japan. Since the early 90’s when the Japanese economy began to go not so well, there’s been a lot of pressure for the government to help it with spendings, and the construction lobby got most of that money for now almost 30 years (and before that with the properties bubble, it was already spending a lot).
So it shows with constructions that are not really sustainable, but they are not there because they are absolutely required, but since they’re a way to spend. Japan just can and will cut back on these when there’s no money. Also you have not fully absorbed the fact that Japan is not America, it’s a lot more people on a much smaller area, so some things that would not be sustainable in the US do work in Japan, like elevated roads in urban areas.
– It’s possible to put luggages in trains, you need to learn to optimize a bit, that what people do in France. In Japan, they send it by a luggage transfer service because it’s very cheap, and really efficient, so it’s just not worth the hassle. Are you really sure no Internet service is available in those trains ? Because since a year the main mobile phone provider in France made sure the Paris – Marseilles line would have connexion all along the trip and we are usually late on those things wrt Japan. Most young Japanese today use Internet almost only with their phones, and the older ones that like computers wouldn’t care so much to not have it for a few hours.
– I recommend you to try to find some good source to study Edo period Japan, it’s an absolutely fascinating time period especially when you’re interested in energy and post-abundance society survival, closure from the external world and lack of domestic resources meant that self-sufficiency had to be pushed further than almost any other country has in history. But meanwhile the country was also evolving during that period, with the merchants becoming more and more powerful which might explain some of the pains that you have heard about. Still the country seems to have achieved an absolutely remarkable state of stasis that could have continued a long time more.
This site has published a remarkable text about this http://www.japanfs.org/en/news/archives/news_id027757.html and I’m now finding that the whole book of the author about Edo sustainability has been translated in English, it’s a must read : http://www.japanfs.org/en/edo/
Also on this subject : http://apjjf.org/-Eiichiro-Ochiai/2346/article.html
Thanks for your links.
Whether or not the state of stasis could have continued a whole lot longer is a matter of debate. Rising population in the Edo period meant falling resource per capita.
I have a hard time understanding how a sustainability discussion does not include topics like maintenance of a stable (non-rising) population. Also, a discussion of how the country was or was not able to maintain inflation-adjusted taxes per capita paid to the government. Tax problems are one of the major things that lead to the end of an economy.
Gail, I think he lives in an alternative reality. You’ve clearly made the point that the Edo period was not sustainable above, and he replies with articles that make the incredible claim that Edo period in Japan was sustainable because a few items were recyclable.
“Tax problems are one of the major things that lead to the end of an economy.Tax problems are one of the major things that lead to the end of an economy.”
Prior to Greece’s debt problems, tax avoidance was a major problem that was papered over, foolishly, with government debt. How was Greek government debt sold to investors when it had a history of widespread tax evasion ?
Just glancing at Edo history, one sees references to accelerated urbanisation, growth of industries, growth of a money economy, development of communications networks, tax problems, ‘waves of peasant revolt’ by the 1800’s – a society with a lot of tensions, and very far from being stable and ‘sustainable’.
When the industrialising and imperialist West came knocking on the door again in the mid-19th century, the most intelligent Japanese realised that they had to take the leap into modernity or be conquered and exploited. Much as the competing states of Europe had to seize each new technological development or be absorbed into their neighbours’ empires.
You affirm that the population of Edo was growing and the maintenance of a stable population wasn’t covered.
Well this is completely incorrect. If you all had been curious enough to just start reading the link that I was referring to you would have found that it says the opposite at it’s very start, that population stayed relatively constant, and then proceeds to describe the kind of method they were using to limit population growth.
Wouldn’t such a discrepancy have been be worth at least a little verification ?
Checking https://en.wikipedia.org/wiki/Demographic_history_of_Japan_before_the_Meiji_Restoration#Population_during_the_Edo_and_early_Meiji_eras_.281600_to_1873.29 shows that the population is estimated to 31.3 millions in 1721, and 32.3 in 1846, so barely any change (given that there was larger fluctuation in the period). Then it went up to 35 millions in 1873, but the country had opened again at that time, and policies had started to change.
Where can I go to view this Edo civilization now? Can I join?
Eddy-
Only if you agree to save your turds;-)
Thanks for pointing this out.
World watches as Yemen descends into total collapse
http://www.middleeasteye.net/news/world-watches-yemen-descends-total-collapse-un-1705220057
Yemen has been on the watch list for a very long time. It is a former oil exporter. It has huge water problems, and an amazingly large population. I remember wanted to write an article about Yemen back in Oil Drum days, and being told, “No one cares about Yemen.” This is a chart I put together showing Yemen’s oil production and consumption a few years ago.
And of the population…St. Matthew Island of Yemen…
https://upload.wikimedia.org/wikipedia/commons/thumb/a/a5/Yemen-demography.png/550px-Yemen-demography.png
Good thing Yemeni-American brothers Steve and Doug Butabi’s dad (from A night at the Roxbury) left Yemen and achieved success in California with his artificial plant store 😉
https://www.youtube.com/watch?v=yvccLwlS3GY
“Speaking to the UN Security Council, Stephen O’Brien said “the time is now” to end the world’s largest food emergency and put Yemen back on the path to survival.” – The population of Yemen is about 16 million higher than it was in the 80’s. The energy supplies are dwindling. I would think the only way to end the food emergency is to reduce the population back about 16 million people. That way energy supplies will balance the population level. If population levels cannot be reduced voluntarily and in a timely fashion (to mirror the decline in energy per capita) then nature reduce the population levels the cruel way.
I know it sounds cruel but feeding them just creates more suffering IMHO only sadists want to send food.
The yeast has run out of bottles until it figures it out…NO soup for you
I agree completely.
Let’s Reindeer them!
You’ll be able to make use of that article here shortly — just substitute Saudi Arabia for The Yemen
everyone take a good look at this — it’s headed your way — but far worse
http://www.middleeasteye.net/sites/default/files/styles/main_image_article_page/public/images/yemen-famine.JPG
Banco Popular’s Co-Co Bonds Plunge as Balance Sheet Chaos Revealed in Potential Forced Sale
http://wolfstreet.com/2017/05/29/banco-popular-co-co-bonds-plunge-balance-sheet-chaos-forced-sale/
Just an anecdote on the progress of collapse here:
I work for a local government in an extremely prosperous part of the US. None of the other signs of collapse seen in many other communities have effected us at all as things have just hummed along. Unemployment is virtually nil, real estate prices rocket upwards, development is all around us.
Our first quarter sales tax revenue came in a little down for the first time in years, and it’s set off a panic within the halls of government. Finance committees are meeting, City Councils are asking staff for reduction plans. The executive leadership has been assembling a multi-pronged financial contingency plan that includes not doing things that were just approved in the budget, cutting back discretionary spending, etc. They’re even taking a big chunk back from a contract for planning services when staff was already negotiating the final scope of services. Of course lower level staff around the organization hear all of this and panic, fearing for thier jobs. Mid-level managers like me play the role of issuing reassurances that this is all just about being prepared, that nothing about jobs or pay is on the table at this point. Nothing to see here, move along.
But it certainly feels like the beginning of something…
Thanks for your on-the-ground report. Our whole system is built on growth and economies of scale. Contraction doesn’t work at all. This is true for governments, just as it is for businesses and for individual families. Once anyone is committed to certain ongoing expenses (such as debt repayment, rent, and food costs), it becomes very difficult to manage a contraction.
Luxury market pins hopes on millennials as industry posts first year of decline since 2009
http://www.cnbc.com/2017/05/29/luxury-market-millennials-negative-growth-since-2009.html
Speaking of anecdotally, here in my home province of Quebec, in Canada, for the past couple of weeks there has been a general strike by all construction workers across the whole province…the result: the regular rush hour in Montreal is a fraction of what it usually is….which means that a big chunk of the rush hour crowd are construction workers…which means (I always knew it but this strike confirms it) that without construction, our economy here would suffer big time…and it is probably like that across the world.
So we have a system that needs growth, and a big contributor to that growth is asphalting the world over…this whole system we gave ourselves was unsustainable from the start…
Had just the same thoughts myself watching the traffic while trying to cross a busy road into town the other day – the sheer volume of construction and maintenance related vehicles.
One often sees up to 4 or 5 cars and vans belonging to construction workers outside a house being built, they certainly add to the volume of traffic.
Pouring concrete the is only game in town.
Not quite. If you live in an existing house, the name of the game is repairing everything. Getting a new heat pump. Replacing old windows that have rotted in places from water damage. Painting. Fixing water damage. Also hiring termite inspectors to come and look for damage, annually.
Repair costs are an important part of home ownership. If we lose BAU, it will be impossible to keep homes repaired.
And then you call for heat pump service, and two guys show up (in separate vans), look at the pump for five minutes and concludes that something must be changed, but they don’t carry spare parts in their vans.
When everything is finished it has taken two guys a couple of hours (10 min effective work), a lot of driving to change a spare part bought from asia for $2. Total cost for customer $300+.
On the subject of falling tax receipts:
https://ftalphaville.ft.com/2017/06/01/2189479/falling-tax-receipts-pose-a-debt-ceiling-dilemma/
That is a very good article. Thanks! It says, among other things, “It’d be good to raise the limit before Congress takes its recess on July 28, the analysts say, since there are big and potentially rancorous budget negotiations coming up.” Also, the longer time goes on, the greater the chance of running out of funds. We will be close by August. By October, it looks very likely.
Folks, I guarantee not one 20 year old person on this planet is concerned about collapse, let alone whether it will be fast or slow. Should they be? Maybe, but they don’t yet have the intellectual tools, and for them what matters is playing sports and chasing the opposite gender.
You are projecting your own mortality onto the system as a whole. Yes, many of you are actually close to fast collapse! What else is illness and death other than that? But even here we see it may take time.
The question is, how much death do we need to reintroduce into the world right now, and at what pace? And my argument is that, we don’t need that much, and the major powers understand that. Just ration away some of the healthcare for middle aged people, bomb some of the peripheral nations, and, voila, you’ve just triaged away major sources of demand while keeping the core consumers (working age population in America/Europe/Asia) intact for another day.
The interplay of incoming trends is creating havoc in old and new models alike. Since the productive age bracket is about to progressively shrink-collapse in China/.. beyond ~2025-35 too, that’s clear sign for easing pressures on resources demand, yes depletion never sleeps, but lot of resources have been brought forward with the cheap money lately. While the affordability question crunch has been also “successfully” papered over so far.
The profile of the next overdue recession will be something to watch, given the increased command economy features incorporated recently, it could be surprisingly benign (lot of printing going in the background). I still don’t expect any systemic derailment for the core before mid – late 2020s..
Worldof
I agree. I’m all agog waiting to see how the CB’s deal with this, and how the propaganda machine spins it.
I know you are a doctor.
You might be surprised how little that rationing away health care for the middle aged and older will really make, when it comes to population changes. What seems to make a difference is (1) what people eat, (2) how much they exercise, (3) assuring people of clean water supply and treatment of waste in a way that does not pollute water supply, (4) not smoking, taking harmful drugs, getting harmed by pollution, or taking undue risks (such as driving a car recklessly, working without safety equipment) and (5) having a purpose for living–being married, having a family, a job a person enjoys, etc.
In the US, education (and thus income/wealth) is highly correlated with life expectancy. In countries where the Gini coefficient is lower, I believe that health outcomes are more even. They used to be more even in the US.
Physics says that when there are inadequate resources, the poorest tend to get “frozen” out. I expect that with almost any healthcare change, the poorest will be most affected. Even if health insurance is cut off, the better educated/ wealthier will pay out of their own pockets to avoid the outcome.
‘Rationing’ healthcare doesn’t seem to add up.
One could deny antibiotics to the middle-aged, but that might only result in a lot of incapacitated and crippled people, rather than stone dead.
No care or treatment in pregnancy or at child-birth? Well, that would certainly increase both the adult and infant mortality rate, rapidily, but not by enough for the declared purpose.
Withholding treatment from sick children would certainly increase mortality, but also mental defectives, cripples unable to work, etc.
In terms of expense, most is incurred treating the elderly, and in the last 3 years of life. Big budget cuts could certainly be made there. bad for health service employment, though.
No treatment at all for those over 60? Again, lots of cripples and dependents would be created, rather than corpses.
I’m quite relieved there is no possibility of Dolph ever treating me….. 🙂
rationing healthcare is just another way of rationing energy
hospitals are factories, doctors are at the sharp end of that factory system.
complex technology sucks in vast amounts of energy, and there is no longer the surplus energy available to run the hospital system—which is why it is failing.
just like the rest of our current ”civilisation” medical care was constructed on the back of cheap surplus fuel,
we are trying to sustain a vastly more complex system–heart transplants, grannys hip replacements–saving 1lb babies–you name it—–using expensive depleting fuel
sorry folks—it can’t be done
We’ve come along way from the ancient Greek physicians in the holy sanctuaries, who listened to the the dreams of the patients and prescribed from them.
The sites of sanctuaries were carefully chosen according to geo-spiritual principles.
Modern hospitals actually look indistinguishable from factories and are dumped just anywhere
Rationing health care to allow enough money to keep the war industry going will make prefect sense to the owners of the war industry. I suggest $50,000 per lifetime of government medical care. After that all the morphine you want.
stop the war industry and you end millions of jobs
not saying that isn’t the right thing to do—just pointing out the way things are
either way you burn fuel
dolph-
I can guarantee that there is one 17 year old person who is concerned as we talk about it quite a bit. He lives in both worlds. Trying to learn to live with little energy and keeping a foot in BAU. Going to university while taking blacksmithing classes. Pointless maybe, but it is something to focus on.
Excellent trade to learn, blacksmithing. Perhaps ‘pointless’ in the long run, but a good and purposeful discipline. Any craft or skill truly mastered leads to self-respect.
I want to talk about rationing, be it any form of rationing – healthcare or any other types of rationing.
You guys are very US or developed-world-centric. If you open up a little, you will realized that any form of rationing does NOT work at all. In my country (and other nearby South East Nations), we have very large factories serving the healthcare business. Gloves, saline, consumables like surgical knives, small parts that are attached to glucose drips. These mega factories that operates 24 hours a day to support healthcare industries. It is the same for all the factories in South East Asia.
Question – when you have rationing, the volume drops tremendously (that is why it is rationed). Frankly, from my own engineering/manufacturing background, I doubt, the factories will operate at a lower production volume (due to costs and economies of scale).
Does anyone know if you have any factories making surgical gloves, needles, parts of glucose drips, surgical knives, etc in your area? How about within 500miles radius or 1000miles radius?
Does any doctor or nurses know how to use the old type (non-disposable needles, glass type that you need to boil or sterilize using the old methods)? How about surgical knives?
Bottom line – no way anyone can ratio because the mega factories cannot operate with low volumes. Read up mass production and economies of scale before tell me “We can close down a few factories” or “we can run 10% capacity”. These are nonsensical scenarios from non-technical person. I have more than 17 years experience working in a high tech mass production factory as an engineer.
GTG, it doesn’t matter how many times you talk sense, the delusional will deny otherwise, even as they go down the tubes…
My father was a general practitioner physician who learned back in the day when modern tests were not nearly as available. He learned a whole different style of “doctoring,” including looking closely at physical symptoms. He was always amazed at how dependent current physicians had become on tests to diagnose what he had diagnosed with many fewer tests. I understand the Europe uses a whole lot less in the way of scans and other expensive tests than the US, even today.
Seems like someone had watched this movie too many times, read the plot summary, lolz..
https://en.wikipedia.org/wiki/A_Boy_and_His_Dog_(1975_film)
another evidence is bau collapsing
Earth’s space junk crisis could lead to catastrophic collisions and damage the global economy
http://www.dailymail.co.uk/sciencetech/article-4557944/Space-junk-destroy-satellites-hurt-economies.html
Sort of reminds a person of pollution problems everywhere. A little bit doesn’t seem significant, so there is no penalty for someone putting up an experimental satellite and leaving it there. But then more and more do the same thing. And failed attempts end up circling the globe as well.
Now we read, Japan Space Junk Collector in Trouble Also http://www.popularmechanics.com/space/satellites/news/a25066/japan-space-junk-experiment-failure/
https://robertscribbler.files.wordpress.com/2017/05/alberta-fire-hazard.gif?w=600&h=464
Ecosystems are temporary in nature. Fire regularly leads to the end of one ecosystem, and the beginning of another. Changes in weather affect both the probability of fire losses and of losses to insects. Unfortunately, this is the way the system works. We have been fighting small losses for years, leading to the change of much bigger fire losses now.
That is the nature of that forest some trees can not go to seed without fire
http://indianapublicmedia.org/amomentofscience/lodgepole-pine-trees-love-forest-fires/
Los Angeles homeless numbers jump 23% in a year
http://www.bbc.com/news/world-us-canada-40115541?ocid=socialflow_twitter
Slow collapse happening since 1970s. Getting worse over time..
A few nights ago my wife and I watched ‘Whatever happened to Baby Jane’ a movie made in 1962. We had watched on rerun on tv, but that was many years ago. Guess that dates us. Near the beginning there is a girl, Baby Jane as a kid singing on a stage and in the audience were all these mothers and their children. It caught my eye because I remember back when I was a kid in the 60’s, 70’s mothers taking their kids and sometimes neighbor kids along also to see a movie during the Summer, on a weekday. Not so much these days but I’m sure it still happens, but back then it was common for there to be only a one income household. What a lot of people either don’t know because they didn’t live in that time period or they forgot, is because it took less time working to pay for housing and other bills, there was a lot more time for people to do other things. But also I remember there wasn’t the hurried, kind of frenzied, desperate pursuit most people are now engaged in to pay the bills and try to get ahead. In 1965 my brother and I both broke our arms and I went to the hospital for 3 days for a bad accident down a ravine. My brother needed a specialist to put the bone chips in his elbow back together and I almost lost a kidney. The total bill for all of that was $2500. but the company ins. my Father had paid for 98% of it. What would that hospital bill be today? 1.7 million? What % would the ins. cover? 60%? If that happened today the parents would in all likelihood become bankrupt and the family would become homeless. That’s how far down we’ve come, so you are absolutely correct CTG about the downhill slope since the 70’s.
I guess that settles the “slow/fast” collapse. We should now be in the final stage of the “slow collapse”. Remember the metaphor that I have said in many posts earlier on being a bathtub full of water and a tiny ship on the other end of the tub having moved along slowly when the plugged is pulled? Well, in 1970s, the plug was plugged. Some super sensitive person felt the jolt (Meadows?) but 99.9999999% did not. Post 2008, many felt the ship moving faster as water in the bath tub drains. Post 2016, many felt the ship accelerating as it circles down the drain. All of a sudden, plop, down the ship goes into the drain and there is nothing left in the bathtub…
Fair enough.
Maybe. Think of the water in the tub as money. As long as you can add more water when things get bad, everything is ok. That’s what we’ve been doing since 2008.
Kurt, seriously you need to go through the process and learn up what is required to fully understand a lot of things. The comments and statements that you make is off the mark. What is money? Do you know the actual concept of money? Metaphorically, adding water/money into the tub is totally unconnected.
The economy runs on cheap-to-extract resources. We can’t add cheap to extract resources.
No money bathtub exists in isolation. A country that tries to add more debt (not just money) in an attempt to get a larger share of the world’s resources, or its output in terms of goods and services, is likely to fail. Think about Venezuela. How can it get itself out of its problems by printing more money? Will that allow the country to import more food, or will the value of the currency simply fall relative to other currencies?
I agree as well. 1970 was about the time the slow collapse began. Part of the collapse is due to increasing levels of corruption and greed. But, the bulk of it is due to decreasing energy per capita. Or, one could simple call our predicament since the 70s the results of diminishing returns. I also agree it is an exponential slow collapse. That is it starts out slowly and accelerates with time. We are now at the business end of the slow collapse when something major breaks that brings everything to a grinding halt.
Well, according to my barbarous relic benchmark, $ 89,285.
I am surprised the number is that low.
The place is a mess. I have no idea what the fix is but pretty sure it is not transgender washrooms carbon tax or Tesla.
For those who think we will hae robots and AI in future…
http://www.zerohedge.com/news/2017-05-30/sorry-siri-youre-dumbest-smart-assistant-out-there
You really need a different kind of computing system than what we have today in order to achieve true AI. What we do great is number crunching. We can complete tough mathematical problems in a short period of time but AI is a different thing.
I am not sure if it is “pure propaganda” or “extreme ignorance” that we have so-called experts coming out telling us AI and robots are the future. As a technical person, I could not understand why there are technical people outside saying that this is possible. Pure delusion?
We certainly need AI: Advanced Intuition.
Even just a touch of it would be helpful …..
Dozens of Peer-Reviewed Articles: Confirming The Collapse of Civilization by 2030
http://www.sciencedirect.com/…/article/pii/S0921800914000615
http://www.feasta.org/…/uplo…/2012/10/Trade_Off_Korowicz.pdf
http://sustainable.unimelb.edu.au/sites/default/files/docs/MSSI-ResearchPaper4_Turner_2014.pdf
https://www.nature.com/…/j…/v486/n7401/full/nature11018.html
http://www.sciencedirect.com/…/article/pii/S030142151300342X
http://www.sciencedirect.com/…/article/pii/S0301421510003204
https://www.ncbi.nlm.nih.gov/pubmed/23303549
https://www.ncbi.nlm.nih.gov/pmc/articles/PMC3154242/
https://scholar.google.com/scholar?q=peak+oil&ie=UTF8&oe=UTF-8&hl=en&btnG=Search
http://www.sciencedirect.com/science/article/pii/S0301421510003204
http://www.sciencedirect.com/science/article/pii/S0301421510001072
http://www.sciencedirect.com/science/article/pii/S0301421513006447
The first step to draw those together, would be, to have the courage to explain throughly how hypercomplexity is born from an cheap energy supernova. Norms book would be a good place ti start.
And then the second step, to explain there will be no recovery, since the hypercomplexity ladder dont work in the other direction. Its a hard drop, so to speak. Also, since hypercomplexity has risks and problems of its own, the flashcrash of complexity will lead to excess mayhem (dams, nukes, soil, fertilizers, vaccines-virulent strains, food production, seed availability, pollution, toxics etc. etc.). With combined effects of reducing current population from 99.99% to 100.00%, doing so historically speaking instantly.
I bet that kinda paper would be extremely popular 😉
Perhaps the world economy can be viewed as a plane flying from London to New York… net energy gets us 90% of the way and we put the last 10% on the credit card.
A slow collapse postulates that once the credit card is declined, we will still be able to fly 90% of the way there
Not really applicable … better…. the plane must fly at a certain speed … if it does not achieve that speed … then it immediately crashes into the ocean….
Everyone on board dies.
The End
We are entering a time of great challenge and uncertainty, when the systems, ideas and stories that framed our lives in one world are torn apart, but before new stories and dependencies have had time to evolve.The collapse of the environment, is also the collapse of the economy, society, and thus the state of the human mind of every participant as well. Our challenge is to let go, and go forth..
I really like how you said this. So true.
Bravo … bravo … encore… I am captivated… I am entertained… the end of the world circus is well worth the price of admission (which is death….)
But, as we’ve learned before after he called Obama a “son of a whore,” Duterte is not the type to back down from the pressure of public opinion and/or the twitter rants of former first daughters. Therefore, it’s not terribly surprising that he lashed out at Chelsea with the following:
“These whores, they hear “rape”. Like, like Chelsea, she slammed me. I was not joking, I was being sarcastic. Listen to the speech. I do not laugh at my own jokes.”
“I will tell her, when your father, the president of the United States, was f***ing Lewinsky and the girls in the White House, how did you feel? Did you slam your father?”
http://www.zerohedge.com/news/2017-05-31/chelsea-twitter-trolls-duterte-gets-blasted-what-was-your-reaction-when-your-father-
“We Will Go To War; We Will Fight You”: China’s Xi Threatens Duterte If Philippines Drills For Oil
http://www.zerohedge.com/news/2017-05-20/we-will-go-war-we-will-fight-you-chinas-xi-threatens-duterte-if-philippines-drills-o
Lovely!
A big war would be entertaining…. 24/7 coverage on CNN…..
I like it. A lot.
Drill Baby Drill!
And then call Xi a son of a whore…. that should get us some fire works.
Fast Eddy.
I think Ive found the “gameshow” for you. I suggest you register as a special guest.
You will be asked questions such as whether you would choose to live to 130 if the future allows … etc
https://www.tvnz.co.nz/shows/what-next
I’d be really bad for ratings if they invited me on….
on the contrary you would be better for ratings … a futurist Simon Cowell … the one everyone loves to hate (and slowly loves) for the rude bluntness …
Ha – I never thought of that — how can I get myself a highly paid gig with a private jet and a harem as the televangelist prophet of doom?
“Barely a quarter into 2017, year-to-date retail store closings have already surpassed those of 2008.”
http://www.zerohedge.com/news/2017-05-31/one-banks-stunning-forecast-quarter-all-malls-will-close-over-next-five-years
Let us all shed a tear for the slow demise of the shopping mall. How will we ever do without them?
I’m not a fan of shopping malls but those are jobs lost which the economy needs to keep functioning.
The downtown department stores closed and jobs moved to the shopping malls. Those were jobs that the economy needed to keep functioning, too.
Yes, but that tier of business has gone and won’t be coming back due to asset inflation induced high rents, etc.
So the poor mall workers are heading for the scrap heap – people sacked from such stores in the UK are finding it very difficult to find any employment at all.
These are the folks whose mortality rates rise. No gainful employment available = cannot afford a wife/partner = not much to live for.
Exactly!
Wow!
Brick-and-Mortar Retail Meltdown Has a Busy Month
This morning, luxury handbag retailer Michael Kors Holdings, which had had stellar sales through 2014, revealed in its Q4 earnings report that it would close up to 125 retail stores and take a $125 million charge, to save $60 million this fiscal year.
Sales plunged 11.3% year-over-year in Q4, and the company lost $27 million, or 17 cents a share. It doused investors with a gloomy outlook for its fiscal year 2018, with revenues expected to drop over 5% to $4.25 billion, and with same-store sales plunging “in the high-single digit range.”
The company was dogged by heavy promotions, a “difficult retail environment,” and a “product and store experience” that didn’t “sufficiently engage and excite consumers,” CEO John Idol said. So the company needs to enhance the store experience “to deepen consumer desire and demand for our products.”
Despite a “new $1 billion stock repurchase program” – funded with the money the company is losing, so to speak – share plunged 8.5%.
Other retailers aren’t so lucky.
On June 1, Gymboree, a children’s clothing retailer, will face an interest payment on its debt that it is unlikely to make. So a bankruptcy filing could be next. Serious bankruptcy rumors started swirling on April 11 when issues with the interest payment cropped up.
On May 4, “people familiar with the matter” told the Denver Post that Gymboree was looking to close 350 of its 1,200 stores as part of a broader restructuring in bankruptcy court. Buckling under its debt, the company has been in talks with its lenders. According to the Wall Street Journal, the company has contacted firms known for liquidating inventories and other assets during store closures.
Inevitably, there is a private equity angle. PE firm Bain Capital acquired the retail chain in 2010 for $1.7 billion, stripped out assets, and loaded the company up with debt – by now $1 billion, an amount company founder Joan Barnes described to Bloomberg as “horrendous.” Meanwhile, Walmart, Children’s Palace, and online retailers have put the squeeze on sales and margins.
To raise cash and stay alive and carve out a niche online, the company mortgaged its distribution center in 2015. In 2016, it sold Gymboree Play and Music to Zeavion Holding, a Bain investor. But in its fourth quarter, the company lost $325 million, and the CEO was sacked.
More http://wolfstreet.com/2017/05/31/brick-and-mortar-retail-meltdown-has-a-busy-month/
http://www.christianmillennium.com/Files/yeats_second_coming_poem.jpg
https://i.ytimg.com/vi/3mZV7MWAY0s/hqdefault.jpg
http://peakoil.com/consumption/elite-oil-investors-believe-a-major-crude-oil-rally-is-coming
‘Elite Oil Investors Believe A Major Crude Oil Rally Is Coming’
“They think prices can run to above $100 again (as was the case in 2008, when OPEC cut into an undersupplied market), especially given the very negative sentiment on oil prices at the moment–what they call “maximum bearishness.” They say the “peak oil” supply obsession has turned into an obsession with the theory of “peak oil demand.”
Over a hundred a barrel again? Well, we sure are getting a wide range of oil price predictions going on lately. This one is a doozy, ignoring what the consumer can afford.
Only problem–the oil producers need a high oil price. They have to keep believing.
Why not bet…. if oil somehow does push over $100 at least for a short period then you win….. if it doesn’t then at some point soon there won’t be any oil so your money will be worthless….
But if investors win my advise to them would be to spend the winnings quickly.
And here we go delusitani to the max. We’re all victims. Completely unaccountable for our actions.
http://www.zerohedge.com/news/2017-05-31/hillary
Alien?
You what a seizure is right?
Ooops missed a word, must be a seizure…
Nah either hardware or software malfunction…those old models are known to do that sometimes…probably fixed that evening though…
Yes I know — aliens apparently have them all the time…
HRC is definitely an alien…. in human skin….
No, she’s human and soulless: that’s what so damned frightening.
At least she disproves, conclusively, the feminist argument that women are so much nicer than men, and that all we need is women in power for the Golden Age to return.
As a citizen of the U.K., I offer you Margaret thatcher and Theresa may as examples.
Today’s moment of clarity from Art. I’m two days late of course.
http://www.artberman.com/opec-extends-cuts-oil-prices-fall-means/
Thanks! It is interesting to read his point of view.
The graphs and discussion bellow the article are interesting too!
For example, how Russia clearly accommodated for Iranian return, or how Algeria almost stopped exporting (another failed state in the making? – well they guard most of the Africa storming Europe ah). But the overall message is that global markets are likely well supplied for next ~2yrs, so unless intentionally triggered scenario, there should be also calm on the doomerstudies front near term future as well..
#themoreyouknow http://www.theonion.com/live/executive-branch-55958/entry/373
Sort of disturbing. We are running out of good ideas.
But we have an abundance of bad ideas and dead-end strategies: each one will generate a ripple of excitement and, most importantly, distraction.
I notice that ‘eating insects is great and eco-friendly’ articles have started popping up again in MSM….
Analysts question latest North Dakota crude breakeven prices
https://www.platts.com/latest-news/oil/washington/analysts-question-latest-north-dakota-crude-breakeven-21737015
good article – thanks
To paraphrase — I drill 1000 holes — 10 of them lead to solid production — 990 are dry — my accounting method (fake accounting) discounts the costs associated with the dry wells…
And voila — 18 buck oil!
Farking genius!
I recommend bankrupt retail adopt this
NIDS*
*(not including debt service)
Creative accounting has been popular for a long time. Art Berman points out that cost per barrel is likely to be shown as low a number as possible.
And of course the CBs encourage this outright fraud …. because it keeps BAU rolling….
More Lies Please.
Netherlands literally running out of gas.
https://www.bloomberg.com/news/articles/2016-09-16/europe-s-biggest-natural-gas-producer-is-running-out-of-fuel
Very interesting about the Dutch: some 2/3 of state revenue from gas production lost in the space of just a few years.
The usual amusing hopium ending to the piece: ‘No need to panic. We saw it coming. We can manage the decline.’ That’s the sort of message the propaganda machine will put about until the lights go out.
I believe Algeria which supplies so much to Spain and France is also following the same route.
I would say that here we can see one of the factors behind the criminal destruction of the Syrian state for the sake of future energy security in Europe.
Given that the comparison is between 2015 and 2013, it seems likely that a significant part of the 2/3 drop in state revenue came from falling natural gas prices. This is the same problem energy exporters everywhere (oil, gas, coal) have been running into. The cost of production likely doesn’t go down (or if it does, it doesn’t go down proportionately). Thus the net benefit to the state is even lower than the comparison suggest. At some price point, extraction no longer makes sense.
This is an update, with 2016 charts, if not numbers.
https://www.cbs.nl/en-gb/news/2017/17/less-production-more-consumption-of-gas-in-2016
The headline tells it all “Less Production, More Consumption of Gas.” In my opinion, Europe’s big interest in wind and solar has come from the fact that they can see that natural gas production in Europe is limited in the future. Admittedly, with a high enough price, a lot of fracking could be done to get natural gas from places such as underneath the city of Paris.
http://www.blog.ze.com/2013/11/france-relies-on-natural-gas-imports-despite-having-abundant-shale-gas-deposits/
https://www.eia.gov/analysis/studies/worldshalegas/
From Romania to Lancashire, us Europeans have not tended to take kindly to the notion of local fracking.
https://ejatlas.org/conflict/resistance-to-shale-gas-fracking
So why bring in more people…Does not compute
http://www.zerohedge.com/news/2017-05-31/stocks-rebound-chicago-pmi-changes-its-mind-corrects-earlier-dismal-data-highest-201
http://www.zerohedge.com/sites/default/files/images/user3303/imageroot/2017/05/31/20170531_PMI11_0.jpg
When it gets really serious — you have to lie….
Chicago PMI —–> 🚽
Do we know what is going on?
There are a lot of signals that indicate the string is starting to give…. the drop in luxury goods sales is yet another canary…
http://www.zerohedge.com/news/2017-05-31/elon-musk-warns-he-will-depart-trump-councils-if-us-leaves-paris-deal
He will of course be departing in his green machine…
http://static2.businessinsider.com/image/515dd7cfeab8eaf003000006-1097-823-618-463/vista-jet-private-flight-new-york-montreal-1.jpg
And yet the stooopid humans believe Elon is the Green God….
We are afloat in a sea of MOREons…. imbe.ciles…. mega re-tar-ds…. donkeys with human heads
Deep-water drilling costs getting a lot cheaper ? Shale oil extraction costs already got a lot cheaper ? What do you think ?
https://www.bloomberg.com/news/articles/2017-05-30/trouble-brewing-for-opec-as-once-costly-deep-sea-oil-turns-cheap
Oh yes of course — The KSA should be really worried — conventional keeps getting MORE expensive!
Even tar sands will be cheaper to extract than conventional
What do I think? I think you need to make use of your brain and think about this …
http://cdn.oilprice.com/images/tinymce/ada2994-min.jpg
There have been some technology improvements, but these tend to be exaggerated in reports, in order to keep shareholders from being worries.
One thing that leads to the impression of lower costs is the fact that drilling contractors who are practically going out of business temporarily charge a lot lower rates. This helps the results, quite a bit, for a while. He says, “Oil cost reductions are 10% technology and 90% industry bust.” http://www.artberman.com/shale-cost-reductions-are-10-technology-and-90-industry-bust/
Another thing that is left out of comparisons is the need for high prices, so that governments can collect enough taxes. Governments depend on high oil prices to give enough profit margin that oil companies can be taxed at a high level. This loss of tax revenue is a huge problem for oil exporters almost everywhere. Saudi Arabia has had to borrow money, and is hoping to sell a share of its major oil company to try to raise fund (and push off future problems to someone else).
http://imgur.com/a/IOmPS
That’s a good one!
Upthread a couple pages Gail says:
“The human caused forcing of the climate system seems to be not a bug, but a feature, of how the economy…behaves.”
See Tim Garrett’s (U. of Utah, atmospheric sciences) excellent work on civilization as a heat engine.
Then this:
“We can try to fix the system… but we are kidding ourselves if we think we can.”
On the macro level, yes. Not true, however, on the micro level.
Either way, not being able to fix the system shouldn’t prevent us from describing it as accurately as we can. That’s the joy of science!
(This is in reference to her earlier comment, “It’s interesting, but so what?” and my reply that it’s inherently human to be curious.)
She quotes from the book ‘Into the Cool’ but one must read carefully and critically.
This is not a new idea.
Schneider and Sagan seem to assert that entropy production is a teleological phenomena. Religious “creationists” invoke this same idea, wrongly, to claim there is purpose and design in the universe. The second law of thermodynamics makes no such claim.
She quotes the book:
“Life has a similar natural purpose.”
The authors confuse “purpose” with “resultant effect”, imo.
“The tornado’s function, its purpose, is to eliminate the gradient.”
We must be careful not to assign human emotion to inanimate processes or we begin the slide into “intelligent design” which gets us absolutely nowhere.
Animism is a primitive religious belief system that does not produce industrial civilization and BAU. Animism is a dead end in accurately explaining the universe.
Better to use Occam’s razor.
A tornado is a result of cause and effect in physical processes – hot air rises, cold air descends, causing different pressure, mix in some gravity and Coriolis effect, and voila, you have a tornado – or a thunderstorm, or a hurricane.
No need to infuse it with ‘purpose’ – or the inspired work of angels, ghosts, and goblins.
Biologists know that evolution does not have ‘function’ or ‘purpose’ or ‘design’.
Rigorous science keeps us honest and checks our descent into anthropomorphism, animism, human sacrifice, organized religion, and madness.
Cheers.
‘Either way, not being able to fix the system shouldn’t prevent us from describing it as accurately as we can.’
My issue with this is that those who are convinced AGW is man-made …. are indicting humans for wrecking the planet (as if there was a choice) — and/or — suggesting that there are alternatives (usually involving solar panels windmills and Tesla cars)….
Ok man is causing AGW. The sky is blue. Water is wet.
Burn More Coal.
There are plenty of folks who are convinced of AGW but do not indict humans or suggest alternatives… many are here at OFW.
But remember, the science that figured out how man is causing AGW, why the sky is blue, and when water is wet,
is the same science that figured out how to burn more coal, drill more oil, frack more gas,
the same science that began the enlightenment, overthrew brutal theocracy, created technology, ushered in the modern world,
and is the same science that developed the logic and mathematics to write complex equations that central bankers manipulate in order to rationalize more debt which keeps BAU humming right along,
until it stops.
It’s a fascinating story. And if there are any survivors, it might become myth, told to children, as we fall asleep in the trees.
Believe More Science.
Cheers.
I suggest you write a letter to Schneider and Sagan, and tell them your views. I definitely did not say that what they said was my view. In fact, the way I wrote the response originally I was going to point that out.
In any networked system, a person can point to many different purposes. The economy provides goods and services to people. It provides jobs to people. It provides taxes to governments. All of these might be considered “purposes” by some.
Schneider and Sagan pick out a purpose that they considered appropriate. The purpose they point out fills a physical need–the need to offset a thermodynamic difference, namely a temperature gradient. Thus, from the point of view of these authors writing in this field, this is their view of the purpose.
“I suggest you write a letter to Schneider and Sagan, and tell them your views.”
I did. No response yet.
Cheers.
The status of conventional world oil reserves—Hype or cause for concern?
http://www.sciencedirect.com/science/article/pii/S0301421510001072
Global oil depletion: A review of the evidence
http://www.sciencedirect.com/science/article/pii/S0301421510003204
Conclusion: By 2020 The World will Burn!
The first article is “conventional oil reserves.” It seems as though everyone would agree that we are getting low on conventional oil reserves.
The argument is about unconventional oil, and how high prices can rise to extract the unconventional oil.
The second article also seems to be about conventional oil.
I don’t think a person can conclude anything based on conventional oil alone. A person also needs to know that prices will remain too low to extract all of the unconventional oil available, and that technology will not bring down the costs of this extraction greatly. There seems to be a large amount of unconventional oil available, if the price rises high enough.
I think it’s all about conventional oil. I totally ignore everything that they say or do with unconventional oil. The reason is we built our entire civilization off cheap conventional crude. Unconventional Expensive oil can NOT a replace Cheap Conventional oil. And I read dozens of the hundreds of Emails leaked to the New York Times awhile ago from the oil executives and insiders of the major US oil majors. They called shale and tar sands a “Ponzi Scheme”. That would “Never ever work” etc..
Just imagine if Toyota had to replace all of their dealers inventories of new “Camry’s”. With new BMW’S and forced the dealer to sell them just slightly above the Camry’s retail price. You would eventually go out of business no matter how much hype was from the Media. And not matter how much demand for the product was or how large of inventory you had available.
Now for the record I am personally grateful that peak oil ignorant banks and investors and Media which has made these Ponzi’s available for consumption. But according to the HSBC oil report 80% of the worlds conventional oil fields are i permanent decline. Which means soon if not already convectional oil production will start declining. Interestingly it could be somewhere around the same time frame that the US oil industry and the shale and tar sands Ponzi’s go out of business as well. shitty timing huh?
.
Cliffhanger, from that 1st article you linked is this:
“The capacity to meet the services provided by future liquid fuel demand is contingent upon the rapid and immediate diversification of the liquid fuel mix, the transition to alternative energy carriers where appropriate, and demand side measures such as behavioural change and adaptation. The successful transition to a poly-fuel economy will also be judged on the adequate mitigation of environmental and social costs.”
Now that’s a mouthful in a nutshell. So easy to conjure up broad generalizations when in reality they ought to just write; Not sure how this is going to turn out but all sorts of s#^* has to happen, and in the right amounts to even have a chance of making this continue to work.
That’s true
bau elite is turn on back on each other
TEXAS REPUBLICAN SAYS HE’D SHOOT DEMOCRAT COLLEAGUE IN ‘SELF DEFENSE’ AFTER IMMIGRATION ROW
http://www.newsweek.com/texas-republican-says-he-would-shoot-democrat-colleague-self-defense-after-617148
Is Saudi Arabia Doomsday Prepping?
It’s no secret that by 2020 there will most likely be worldwide oil shortages. Even the CEO of Saudi Arabia’s largest oil company recently warned of this. As well as the International Energy Association. And once the shortages hit the world economy and the public becomes aware that there are no quick or easy solutions available. Things will go downhill very fast and very quickly.
According to the Carter doctrine of the 1970’s the Saudi’s are automatically protected by the full strength of the US military against any and all foreign enemies. And according to the IMF they are on course to be bankrupt by 2020. Based on those two reasons. You simply would never buy the largest weapons purchase in the history of the United States at this point in time. Unless there was a black swan coming over the horizon. They obviously feel that once the shortages come it will most likely cause massive panic and a gigantic stock market crash inside the US. And it will most likely usher in the end of global capitalism.
At that point it will pretty much be every country for themselves. And they will no longer be able to count on the US for military support. And since they are sitting on 25% of the worlds oil reserves. They will instantly become an easy target for all foreign interest. And they will also need the weapons to keep their own population from rising up and overthrowing the Royal family from power.
Conclusion: The Saudi’s are Doomsday Prepping for the end of the oil age and Globalization by 2020….
Most military equipment becomes obsolete within 5-10 years and in the event of collapse, replacement parts would be improbable to get. So doomsday would need to occur fairly quickly. Either that or they just want to be prepared to take on ISIS or whomever else. The ME is in continual upheaval.
Who do you think funds ISIS,wouldn’t be the House of Saud by any chance?
Who is capable of financing and running the logistics?
Follow the money.
http://www.azquotes.com/picture-quotes/quote-amateurs-talk-strategy-professionals-talk-logistics-omar-n-bradley-134-40-39.jpg
The amount of desinformation in here is bewildering.
I’ll give you the Boeing B-52 Stratofortress:
Conceived in the 50’s and will still be operational in 2050. That’s a century of military service.
A technology platform built to last and project power.
https://i.ytimg.com/vi/b_0dnw0owqE/maxresdefault.jpg
Markets are concluding growth is over in energy and commodities.
http://www.zerohedge.com/news/2017-05-31/rbc-entire-world-long-tech-short-energy-and-now-it-gets-interesting
The impression a person gets from reading the article, though, is that the authors are mostly interested in how they can sell services that will allow investors to make the most of an temporary imbalance in the marketplace, namely, the “entire world is long tech, short energy.”
A person doesn’t get the impression that they really believe “the best is behind us,” except to the extent it helps them make money, right now.
That’s where all my Hedge Fund owner friends go as soon as I start on macro economics. They only want micro. Their time horizon is about 3 minutes long.
People trying to position themselves for the next 2008 in order to make money, have no clue what is awaiting us…there is no profiting from the next 2008…
Often on FW we hear comments about why it is so difficult to explain the predicament the world is in. It’s often hard to understand why people almost invariably choose the “Reassuring Lie” rather then the “Inconvenient Truth”. Some have speculated that it is a genetic condition. I rather think it is environmental.
From the time we’re young we have been conditioned to accept lies. As a matter of fact many people have fond memories related to the lie they were told in youth. There like a warm blanket that envelopes mankind.
Santa Clause, Tooth Fairy, Easter Bunny, Imortality if the Soul, Burning Torment after death, Heavenly existence after death, reincarnation, nirvana, Heavenly Harems, racial superiority, Manifest Destiny, American Exceptionalism, Religious Superiority, Intellectual Superiority …………
All lies all the time and infinite.
Truth on the other hand has limits as does science.
The dominant economy that governs resource allocation is itself a lie.
This has all been put in place by the Father of The Lie.
Upton Sinclair: “It is difficult to get a man to understand something, when his salary depends on his not understanding it.”
I wonder how many of us here have experienced a serious loss that opened our eyes to the impermanence of things. It’s easy to believe that things essentially stay the same if that has been your personal experience. I envy those people.
Has anyone here ever read Pillars of the Earth by Ken Follett? The book is tedious because of the horrific losses incurred by the characters over and over. But it really demonstrates the lack of security that has existed for most of humanity. Things like property are more connected to force/power than we might like to believe.
Hey Sceadu, I don’t envy them and I’m very happy that I had the curiosity to go to the complete bottom of this huge rabbit hole that is our predicament. It makes me enjoy every day more, I don’t take them for granted…and when the SHTF, I’m not saying I won’t be freaking out, but I will be at peace with it…I am definitely at the Acceptance phase…and like FE said some time ago, it is kind of liberating knowing about all this…you don’t stress with anything, just enjoy the day…and finally, one of my favourite expressions since finding out about all this and knowing there is no way I’m dying of old age (unlike my 4 grandparents who all lived past 90, one even reached 102): “It is what it is”
Carpe Diem!
I think there are pros and cons to knowing what will come. I’ve always kind of liked the idea of dying very swiftly when I was least expecting it — a plane crash, maybe. Everyone has heard stories of people who lose their will to live after they retire or otherwise give up their purpose in life. The danger in dwelling on collapse is slipping into purposelessness. We so often define our purpose in terms of future generations, children, and posterity. Losing hope in these things can have a profound effect on people. Many commenters here think that having hope is a function of intellectual deficiency, but in fact hope for the future, even if delusional, is adaptive for an individual (though perhaps not a society or species).
For my part, I tend to enjoy things more when I am not simultaneously imagining what life will be like without them. I’ve had a few hopes and dreams crushed and I find it harder to enjoy things now because I dwell on the potential for loss. I still believe in seizing the day and spend less time worrying about the long term than most people, but in the short term, I have to maintain some personal goals to keep going and not constantly remind myself that all of that will be taken away. After all, we all die in the end and none of us knows when that will come. If we all sat around and decided that nothing really matters because we will die, what would become of us all?
Contrary to what some OFWers believe, having the MSM report the “real truth” and having all humans slip into hopelessness is not a desirable outcome at all. The delusion of a secure future serves an important purpose.
‘I’ve always kind of liked the idea of dying very swiftly when I was least expecting it — a plane crash’
That is my Dream Death Scenario …. if you gotta die it might as well be exciting
Even a few generations ago, there were a lot of widowers, because of wives who died in childbirth. I am sure industrial accidents were common, and there were cures for common diseases. We read about the many famines. We don’t realize how relatively good a situation we have had, since World War II.
I believe that in England in the late 19th century, by the age of 9 yrs every child had lost at least one parent. Women died at the first pregnancy more often than we can imagine today.
I once repaired an 18th century Bible with the births and deaths entered in it, from a very wealthy and grand Scottish family – nearly all the many children died before puberty, and that at the top of the social tree.
We certainly live in Business As UNusual.
Good point!
have ofw commented is notice that people are become more tribal then ever
for e.x. white Americans believe that will replaced by black people
so they become more right wing than ever and believe white race should rule usa
and black people think will oppressed by white for ever so we have milltary groups (blm)
in iran shia muslims believe sunni muslims destroyed islam by extremism groups (isis al-qaeda)
in saudi arabia sunni people believe shia muslims are worse then unbeliever and helping assad
in syria and in yemen helping houthi
Your living in “it’s not my fault World”. Which means it’s your fault things are bad and “I’m going to do something about it”.
Things are only beginning to get bad. As scarcity increases those ignorant of the real cause will become polarized over religious and racial lines.
When people are nervous, they will want to live in their own group.
With good reason. Historically, while you might get done over by your own people, those from other groups will be very much worse, on the whole.
There is no such thing as Mankind, on a day-to-day level, least of all a Mankind united in love and mutual respect……..
China Is The Greatest Financial Bubble in History
https://dweaay7e22a7h.cloudfront.net/wp-content_3/uploads/2015/02/ChinaCrumble-650×360.jpg
“China is in the greatest financial bubble in history. Yet, calling China a bubble does not do justice to the situation. This story has been touched on periodically over the last year.
China has multiple bubbles, and they’re all getting ready to burst. If you make the right moves now, you could be well positioned even as Chinese credit and currency crash and burn.”
Yes, some will get rich beyond their wildest dreams, before they die prematurely.
Perhaps, it’s one of those misplaced careers, Rickards seems to be on the surface a likable chap in the sense of having with him drink or two in Las Vegas club bar, fine, but certainly not passing the muster of ever allowing him manage your money or form your analysis. Self nurtured rumors about his “intelligence networks pedigree” aside, there is certainly big incentive for TPTB in pushing the scenario, where China is blamed for the initiation phase of the next biggest crash, mind you I’m not disputing their debt bubble either. The article is not very well sourced, for example India sliding into hell hole is in no way or shape to challenge China on manufacturing scale/share. The missing high tech argument is also weak, given US can’t mass produce NPPs or national fast rail program, besides the situation on the ground is increasingly resembling UK’s, where most of the science/tech is done now by fresh or second gen Asian immigrants.
I love Rickards’ ‘This Mysterious American says the UK £ sterling is about to collapse’ ads, or something like that. Wearing shades.
He is a cool bloke, but somehow my impression is that he on purpose mixes some dosage of specially crafted propaganda, half truths, and couple of valid points on top of it..
And that “news site” he put up recently surely smells like major psy-ops outlet.
LOL!
Let me offer you now again completely unworthy foolish musings topic and post here, lolz:
The energy storage domain is evolving rapidly. There are two basic approaches, the first one is using known old technology but scaled down to household size, that’s the RedFlow zinc plating battery (essentially a machine), they admit the elevated price is dependent only on recouping the initial investment of preparing it for outsourced mass production (Flextronics?), i.e. the material cost of the contraption are fraction of the sale price, it’s only a question of mass production, eventual copycats joining the game and so on.
The other avenue are the variations on small cylindrical format lithium cells, still evolving, now the top offering from Panasonic/TSLA is supposedly guaranteed 5000cycles ~30MWh lifetime throughput, almost no significant shelf life or discharge issues. That’s apparently more than enough for most users on whatever mix of renewables/heat pumps/off peak grid system they live (unless you want to directly and continuously heat by electricity in northern climate, which is a wasteful nonsense and not advisable in the first place). The so-called Gigafactories in full swing should enable ~.10c/kWh pricing. Now the problem is that at the moment only one is being completed in the US, and for tax/transport issues you likely need one operating on your very continent to beat the diy approach sourcing Chinese large format batts instead. Moreover TSLA seemed to cancel the ordering option without pre-fitted DC inverter, for the moment pushing theirs own brand only. And as you probably should know, as of now the complex interplay of all the subsystems (batt chargers, renewables DC inverters, grid connection electronics) is working only with the very specific cross selection of vendors/models (TSLA guarantees only its own closed universe of limited capability products and you won’t be able to mix several different types of renewables easily), might likely change in the future with further integration, but it could drop on lower priority in their plans though, hence delay, and over reliance on one single vendor.
So, in summary, if you estimate we bounce-muddle through the ~2019-2025, hold, and don’t buy it yet, wait ~two years for TSLA new refined batt chemistry flowing via giga volume production with corresponding drop in prices, or alternatively for the drop of price for the zinc battery machine around same horizon. If you must now dispatch the funds for whatever reason go diy with individual quality European DC/AC components + Chinese large format batt cells, you will be set for next 10-15yrs.
Electronics aside, don’t forget mules and oxen are good variant as well..
https://twocent2c2.files.wordpress.com/2015/08/capture-delusion-blog-08-15.png
Yep, trying to provide a bit of quality info for free on public forum could be sometimes deemed unreasonable..
Some, believe “fast scenarios” make ultimately no difference, it’s supposedly smooth on/off situation. While others are of the opinion, that it’s more “civilized and cozy” to spend the proverbial last day facing the revolutionary flash mobs and/or scavenging thugs with working fridge and faucets. It depends on the perspective..
Floating like a cork on troubled waters = keeping an eye out for useful expedients and technologies.
As the peasant said: ‘You sort of got to believe, and not believe, if you see what I mean?’
Your post was not here an hour ago. Something screwy is going on with the date stamps. I was the only responder to FE re reason, then my post disappeared then yours and worldofhanumanotg’s appeared.
hmmmmmmmmmmmm?
I have no idea why.
Ommmmmmmmmm
Earlier post seems to have been edited out?
Knowledge is a polite word for dead but not buried imagination. e. e. cummings
Reason is so-so, but it will never discover anything new.
One cannot put in 500 hours of work and yield a corresponding innovation.
Knowledge is a polite word for dead but not buried imagination. e. e. cummings
The original that disappeared.
I suspect that this is the MOREon filter at work…..
The mule/oxen part was not unworthy or foolish.
http://2.bp.blogspot.com/-_wdtior1z9M/UJCN8jTkatI/AAAAAAAAARQ/WJvwWWemRR8/s1600/vintage+borax4.jpg
Well, I was more referring to small scale mule/oxen teams applications there.
But people would be shocked to witness the complexity allowing those grand works of antiquity and/or medieval period, huge water canals, giant high rise castles, mining, hauling thousands of tonnes of stuff. And it was all essentially leveraged world made by hand via those animals, concepts of gravity-mass, inertia, material friction etc.
Disclaimer: no I don’t expect a 1:1 re-run..
I am not talking about Asian CBs but more on general societal decay or collapse. It is only gaining strength lately (accelerating). In the 1960s, I would think that people are prim and proper. I have seen a few old football (soccer) footage (black and white videos). The spectators are all wearing coats and ties, totally unlike the current hooligans… Please correct me if I am mistaken. These are the things that shows that collapse has already happen more than 40 years ago. It is just that it is more glaring now.
The ongoing (or even accelerating decay) and collapse trend is indeed glaringly visible and directly into our faces. I do feel your pain and also in comparison mourn the properties of past decades (both real and imagined). We mentioned here often, the larger humanistic cycle of betterment and attempts of understanding is closing after the run of ~800yrs, the shorter-younger industrialization of the globe cycle is stalling in sync, and after closely managed bumpy plateau likely to dive soon, ..
For lack of definitions we mostly fight over the years – few decades left on this bouncy plateau. Remember, the most bitter fights tend to broke about the offshoots from former single religion-cult, and like it or not cultists of sorts we are here..
Worldof
Yes, things certainly started to take off in Europe in the 12th-13th centuries. Not that one would guess from filmakers’ versions.
I would certainly not wish to try out the 11th century though.
The standards of dress seemed to be much higher, years ago. Up until the 1970s, women were expected to wear dresses, rather than pants. Men tended to get short haircuts, until the advent of the “hippies,” which happened somewhere in the 1960s. https://www.hippy.com/timeline.htm According to that site, in 1965, Time Magazine called young people, “generation of conformists.”
It was shortly after that that race riots began and as did protests against the Viet Nam war, and the drafting of young people to serve in this war.
One thing I notice in looking at data from this timeframe is that the US inflation rate started increasing in the late 1960s. It had been under 2% per year, up through 1965, based on CPI urban. Once we started all of Lyndon Johnson’s social programs, plus the Viet Nam war, the annual inflation rate increased to 4.7% in 1968, 6.2% in 1969, and 5.6% in 1970.
This time period seems to coincide with the shift from frugality as a cultural/moral value to consumption as a cultural/moral value, a la Mad Men.
You may be right. This was about the time the Interstate Expressways were going in place. Televisions were widespread. People were becoming more aware of the world. Women were starting to enter the labor force in significant numbers. The higher inflation coincided with higher wages, too. Saving money no longer seemed as important.
I doubt that there is any correlation between societal decadence and what people wear. I remember a joke from the mid-1960s: “I say, I say ! Who was that woman I saw you with last night?” “That was no woman – that was a Rolling Stone!” People forget that men in Victorian times, a very prim era, had long hair and beards.
As a boy in Northern England in the mid-1960s, I never saw any men wearing open-toed sandals. When I visited the Netherlands with the school, I came across the phenomenon for the first time and was shocked to my very core. If I’d had the vocabulary, I would have regarded them as “foot transvestites”. 😉 To my horror, “foot tranvestism” started to hit Britain in a big way throughout the 1970s. Now it seems to be virtually ubiquitous.
As for the Asian gentleman commenting about the West and “transgender”, as though they didn’t have such a thing in Asia, I well remember how we laughed in England when we first heard the concept of the “lady boy”. Not forgetting:
https://en.wikipedia.org/wiki/Hijra_(South_Asia)
The phenomenon is probably as old as human history. Sometimes it’s more visible, sometimes less. As for me, I’m very staid, and you’ll never even catch me wearing jeans. I’ve long since learned, though, that what people wear generally has little to do with their moral standards.
I agree that clothes don’t necessarily tell you very much about a person, especially anything about their moral standards. We all know that there have been a lot of well dressed men who have been found guilty of sexual harassment in businesses, for example.
But sometimes clothes do tell something about a person, especially when a group of people stop dressing using the standards of the day, as the hippies did, way back in the 1960s and 1970s. The standards of the day of course vary.
“The standards of the day of course vary.”
You imply that there is only one set of standards. However, human beings have always had all sorts of opinions and formed into all sorts of groups. There are social uniforms galore. The question is, why are they often restricted to a narrow range? I suspect it has something to do with how repressive (or not) or democratic (or not) a society is. So I think your thinking is not subtle enough here. The question is, will post-BAU society become more repressive, and will the way people dress accordingly become more standardised?
In 1938, a young German woman was reported to the Gestapo as being “suspicious”, because she habitually dressed like a man. She was arrested and never seen again. So dress is always an issue, but often in different ways.
Plenty of transgender ‘tranny freaks’ in Thailand… Philippines …. etc….
A quick story… more detail can be found at http://www.fasteddy‘sgreatasianadventures.com
I’m in a bar in Hong Kong with a mate — we see a guy who is probably in town on business dancing with what we know is a tranny freeeek….. his buddy is watching… the guys starts making out with tranny freeeek….
I says to my buddy – maybe I should tell them that is a tranny freeeek…. he says ya good idea…
So I walk offer to the guy’s friend and I says your buddy is making out with a tranny freeek… he says ‘really’ — how do you know that — we just know … check out the hands… and adam’s apple….
He just laughs…. I says – aren’t you going to tell him?
He laughs more — nope — f789k him …. this will be a great story to tell when we get home….
Who knows, Paul? Maybe his mate was enjoying himself. You never can tell. 😉
CTG
I spoke to an old Italian who came to England in the 1960’s and did very well as a barber. He made the same observations: ‘I was looking at the people in the street, and thinking are these the English, the same people who used to look so clean and smart?!’ It was the peak for the average man or woman.
“The spectators are all wearing coats and ties, totally unlike the current hooligans”
And go back to the 1940s, and you’d see the immaculate uniforms of the SS. And the Nazis weren’t hooligans, now were they? 🙁
I think I have the “eureka moment” on why there are so many people who does not understand that why slow collapse, “muddling through”, “command economy”, etc will not happen.
I did not realize about it until just an hour ago. These people do not understand that our financial system MUST grow. Growth is required in a FIAT monetary system. If there is slow growth or no growth, then all will collapse. This is the point that the “slow collapse” people do not comprehend. They do not comprehend that due to usury (interest), there has to be a system that is capable of paying back the principal plus interests. The more people borrow money (house, car, etc), the more future growth is required to service the debt. Without growth, the system will grinds to a halt. The “slow collapse” camp thinks that it is possible to collapse slowly or muddle through but how are people going to service the debts? One man’s debt is another man’s assets (pension funds, banks, etc) and you cannot forgive the debts.
Let us say that I have a business that is running well. I bought 2 houses, 3 cars and some luxury stuff using bank loans. I certainly hope that my business keeps on growing (i.e. profit higher and higher every year) so that I can service the bank loans and pay salary to my workers. If my input prices is fixed (i.e no inflation), then I don’t mind if my company does not need to grow because my input=output and I can service the loans. However, since there is inflation, I need growth. I need more customers or sell more products. If I don’t have a growing business, I cannot afford all the monthly loan payments. If I stop payment and default, then the bank will have a bunch of used items (houses, cars, etc) that they may have problem selling off. They would rather you pay them back.
Debt is a feature of fiat monetary system and inflation is part and parcel of fiat. Just look at history and you will know that the fate of fiat is sealed.
Money is a token of energy consumption, saving money is a way to postponing the use of future energy. You can buy an expensive watch or car and manufacturing the car requires extensive energy. You exchange the energy with money.
Bottom line – money is tied to energy and the economy must growth. No growth, the system collapse. No other way out. No other options.
150 years ago when money was gold backed, money was scarce because gold was scarce. Thus, no inflation because no one takes a bank loan. No one needs to pay interests on the loans. You have to either save the money to buy a horse carriage or you have sharecropping where each party takes a certain share of the profits/produce. You don’t buy what you don’t need. House prices did not go up because one is more than enough for a few generations to live in. When you have no bank loans, there is very less inflation. See chart below:
http://static4.businessinsider.com/image/50e77df8ecad049b56000004-1044-732/screen%20shot%202013-01-04%20at%208.09.14%20pm.png
viewing it this way, you can say that we actually averted collapse in the 1970s when Nixon removed the gold peg. Whether it is luck or on purpose. our civilization survived a few more decades. See the chart above. The near vertical line starts after the the gold peg was removed.
So – COLLAPSE STARTED IN 1970s and it has been a slow collapse since then. It was after 2008 that the COLLAPSE ACCELERATED to the point that people can feel it
If this is year 1980 or 1990, do you think we will be here talking about FINITE WORLD ? (if internet existed) No? Why? because no one can feel slow collapse.
Quick question – do you know if layoffs are common in the 1950s and 1960 ? Still remember the 1970s where the father is the only breadwinner and he can support the entire family even he has a blue collar job? That is “NO COLLAPSE”. We don’t have any political correctness, no transgender toilets and people are mostly honest and down to earth?
Fast forward through the times 1970s, 1980s, 1990s, 2000s, 2010s – realize that the number of layoffs gets more and more over time? That is collapse in slow motion. Ever realize that one working parent is not sufficient to raise a family? Need both husband wife. How about 2015, 2016, 2017 where 2 working parents are not sufficient to raise a family and one may need to have 2 jobs? Blue collar workers does not even earn enough to sustain oneself, what more the entire family? That is slow collapse. Look at the younger generation (millennials) – do they even have enough money to buy a house or a car? So, without any great jobs and aim in life (because there is really nothing left to look forward to), they are easily influenced about the liberals (aren’t they mostly left wing?) and do their bidding on transgender stuff? (like Asians say – “got nothing better to do in life”) Why are the right wings mostly older people? They know what it was, the good times in the 1960s, just at the peak of human civilization before it collapse.
I was born in 1973 but I know that life was certain marvelous in the 1960s and “future alien historians” will look back and point to the 1960s as the peak of industrial civilization where homo sapiens are at its best.
Printing money is the last straw. To me, there is no more slow collapse because slow collapsed started 40 years ago.
* As an Asian, I am so amused by the political scene in developed Western countries – left, right, center, conservative, labour, etc). To be honest – those are lot of rubbish. That is why in Asia, we don’t have this kind of stuff. Life should be practical and not utopian. We say “We don’t have time for all these rubbish stuff”.
That’s not a bad overview.
However, do you realize that at the moment the major CBs/govs/Elders are today directly printing ~$3T per year, and that’s only the more or less visible plane, sloshing into stocks and bonds we know about, moreover there are also the unfunded liabilities in future pensions and medical, sized one or two factors up, and prolly many other avenues invisible to us now, how they delay and prop it all up. Btw. last time I checked BoJ and BoC are Asian CBs too..
Great post CTG as always!
BTW, if Nixon would not have gone off the gold-peg in 1971 (3 weeks after my birth!) there is no way we could have grown the system the way we have since then (not enough gold to back everything up)…and I don’t think it was done purposely (as in “if we don’t do this we will collapse”) but it was the natural progression of things..it was what was needed to take the global economy to the next step. (It also helped that countries could see that the US was spending way too much with Vietnam, and that there was no way they could back all that up with Gold) I also don’t think it’s a coincidence that this happened a year after the US hit its peak in conventional oil production…by going fiat, it enabled the system to continue to extract resources with no physical barrier (represented by gold here)..I find it laughable when I read pundits talk about going back to the gold-standard…there is not enough physical gold to back the global economy at this point…
But as Voltaire said:
“At the end fiat money returns to its inner value—zero.”
‘a natural progression’
I agree — all of these ‘decisions’ that have been taken are simply natural progressions…
The fact that there are certain people in power who are seen to make these decisions is a natural progression … the people who are in power are there because their system is the most efficient at creating growth…. if it were not then some other group would take over with a better system… that is why communism failed —- it was not a better system….
Not any different from the reality that Usain Bolt is the fastest man alive …. if he were not then someone else would be…
Everything is driven by this natural progression — and it cannot be stopped — any more than yeast can be stopped from wanting to consume sugar… anymore than humans would turn down a free gift of USD50 million…
We are talking about the primordial drives of DNA here… we are talking about the Art of Motorcycle Maintenance…. of ‘excellence’…
Anyone can be on the gold standard. The Bretton Woods agreement was between Central Banks, not private citizens. How individuals store their wealth is up to their own discretion. Some like stocks, some bitcoin, some real estate. I say may the best wealth preserver win. One thing is for certain, those players with a vested interest in keeping your savings within the corral of their creation will fight tooth and nail to keep you there. As I’ve said before, US Post Office employees are precluded from storing their retirement money in the form of constitutional money. That’s absurd.
How leaving the gold standard could have throttled this runaway growth we’ve had since WW2 is another argument altogether, especially since Saudi/Texas oil was essentially free.
With the US dollar being pegged to gold, the US could never have gone on the buying spree of the last 45 years printing money wantonly (and the huge deficits they created, every year except a few years under Clinton’s 2nd term)…there would have been a hard cap on world growth…
“If there is slow growth or no growth, then all will collapse.”
Sorry, absolute nonsense. There are things called recessions where growth is negative. Then, the economy recovers and we have growth again. When does a recession turn into a collapse is the real question.
Kurt, I assume this is your honest statement and without sarcasm or being witty. It looks that your are not fully enlightened yet. I cannot explain all these to you as you need to go through the learning cycle yourself. Recession is just a 2-quarter negative growth. There is still a potential for growth. It is different from systemic low growth that we are talking about
Kurt we do not live in that world anymore…since 2008, it IS different this time..before 2008, after a recession you did not need constant CB support (going on 9 years) to keep the lights open worldwide…all they had to do was to just drop the rates to stimulate the economy again…oil just had to drop to a price where demand would pick up again, and producers at that new price equilibrium would still make money (just thinner profits)…now there is no price equilibrium at ANY price…we’re not in Kansas anymore…
And what do we do to stop a recession?
We reduce interest rates — and pump out stimulus.
In case you had not notice rates are at record lows — and the stimulus is epic…
So when we head into recession — how do we get out?
CTG.
Excellent, yes we are IN a collapse, a long way in.
Politics in Europe is often about belonging sentimentally to a tradition: above all on the Left – the long history of revolutions which are meant to have made things better (some were just a dreadful mess), the perpetual struggle, the sweatshirts with slogans, the Palestinian scarfs (in the 1930’s it was Spanish berets and red ties), ‘The People, armed, can never be beaten!’, ‘No Pasaran’, etc.
It’s quite trilling for people who want to find a community, which then tears itself to bits over political doctrines and words – like theologians.
I agree. The financial system must grow. People don’t understand this.
In fact, growth is a “feature” of the universe as a whole, and of practically every piece of it. Atoms find that they are more stable when combined into molecules, pushing the system toward more and more complex structures. Humans find that aggregations in cities are helpful for commerce, education, and many other things. The fact that population keeps growing means that a lot of other things need to keep growing, such as governments and economies. Businesses need to be financed by stock or debt; they have significant fixed costs. Given these considerations, they need to grow, or they tend to collapse.
In the long run, you are correct. However recessions and recoveries do occur. Constant growth is not necessary to avoid catastrophic collapse. I wouldn’t consider a recession a collapse, but it seems like some of the folks here are leaning that way.
There is a difference between a minor “bump in the road” and a collapse. The Depression of the 1930s was as close to a collapse as the world has seen in recent years.
That’s why we should try to keep in mind the definition of collapse, in relation to human societies, which is really two -faced:
1/ Loss of efficacy of established higher structures, and 2/ Collapse of those higher structures leaving only less complex levels (if any).
Eg. Life in the city gets nasty and uncomfortable, failing to provide adequate and affordable goods and services for the mass of the population, compared to earlier functioning, and then, Bang! Goodbye city, and Hello village or cave…….maybe.
This is clearly very distinct from a classic and cyclical economic recession, which we have been used to since the advent of globalism and industrialisation in the 1800’s.
We are already starting to see some of this definition of collapse, which the reason for the Brexit vote and the Trump vote. The people who are being marginalized vary. In the US, the rural areas seem to be having the most problem with finding employment for men, especially those without specialized degrees.
So what happened after 2008?China went on an unprecedented building spree the likes of which the world has never seen.What I probably should have said is a debt binge the likes of which the world has never seen.
Lets not even talk about the ECB,BoJ,BoE and our beloved FR shenanigans.
This time is different.
We have not had a recession since the financial crisis. And we cannot have a recession — because the central banks have already put in play all the policies (and far more) that they would normally use to lift the economy out of recession — stimulus + interest rate reductions.
When we go into recession that will be catastrophic — because there will be no way out.
The way it is likely to play out is that companies lay off massive numbers of people as sales plummet — laid off people buy little — and fear of being lay off means people with jobs pull back…
This results in more layoffs — and soon you have a death spiral.
Ultimately we get massive bankruptcies
Recall the auto industry going tits up in 2008? The Fed bailed them out — then they unleashed massive stimulus to get them back to profitability — well that is not possible now — as we can see even with gargantuan stimulus and rebates —- they are shrinking…..
So when we get 2.0 …. these massive companies fail —- the banks collapse….
And we eat boiled rat and we start chasing young tender children (and not to sell to priests…)
As someone who spent a large portion of his university career in the natural sciences, mostly biology and ecology, and then later developed an interest in astronomy, I’m not sure that I’d agree that growth is a feature of the universe. Of life, yes with some qualifications, but of the universe, no.
Life attempts to grow, filling every niche it can, but it doesn’t need to grow. (I would also be hard pressed to use the term “steady-state” when discussing any biological or ecological system.)
On the other hand, I have done some cursory exploration of economic systems that are not growth based. It’s hard to imagine a voluntary move in that direction.
Perhaps I should use the word “expanding,” as in “The Universe Is Expanding Surprisingly Fast.”
It is this expansion that causes a growing gradient between the temperature of matter and the temperature of radiation. Some scientists, including Eric Chaisson in “Cosmic Evolution: The Rise of Complexity in Nature,” and Eric Schneider and Dorion Sagan in “Into the Cool: Energy Flow, Thermodynamics and Life,” believe that this temperature gradient is what allows the formation of all of the dissipative structures in the Universe.
Does growth = expansion?
You got it!!!!
The collapse has been happening since the 70s. These are the final hours. All the levers have pulled and the life boats deployed.
Capitalism requires the belief that the future is greater then the present. Knowing it can’t be destroys the narrative.
You are right in your assessment of “slowers”. I do not accept this commandment that the economy must grow everywhere all the time. I understand that the system wants this growth but I think it will run on whatever it can get.
You say that money printing has enabled growth since 1970’s. So what is growth other than the amount of money we print to keep us dissipating resources at a decent pace?
Money is a token of energy/resources. As long as there is a significant amount of resources to be dissipated there is money, there is trade, there is a financial market. It will go up and down, but it is just an instrument of trade.
Debt is what tends to pull the economy forward, by raising commodity prices. Money is a part of an economy’s total debt.
“You say that money printing has enabled growth since 1970’s”
Yes it did…but that money was used to pull out quality resources in a world with 4-5B people enabling the economy to really actually grow….now we are 7.5B, with less resources and of lesser quality which means more of our dwindling resources have to be used to access those resources, resulting in less left-over for the rest of the economy…this is a vicious-circle that is being hidden by the acrobatic efforts of CBs but is clearly unsustainable…at one point the financial system will recognize the unsustainability and crash…and then we will be off to the races….the CBs will not be able to step in to save the day…
I would argue that debt growth in general is more important than money growth–especially debt growth that gets back to wages of the non-elite workers. Money is a specific kind of debt.
Pravda NZ aka Radio NZ …. discussing lack of wage growth … mentioned ‘80% of all salaried workers in the OECD inflation adjusted wages have not grown in 10 years’
Not sure where that stat came from ..
https://twocent2c2.files.wordpress.com/2015/08/capture-delusion-blog-08-15.png
Reason is so-so, but it will never discover anything new.
One cannot put in 500 hours of work and yield a corresponding innovation.
Knowledge is a polite word for dead but not buried imagination. e. e. cummings
The thing about Finite World…
Is that that Gail has no agenda other than seeking the truth…. she does not run ads on the site — she does not seek to monetize what is a site with huge numbers of followers – in any way.
She sells nothing – she runs no banners – nothing. Her only agenda is providing research and a platform to discuss energy and related issues.
Not speaking about anyone in particular, nevertheless, it would be helpful to avoid running in circles, echo chambers, etc. Most of the prognosticators since ~2005 (incl. “phds” have huge eggs on their faces)..
Exactly.
Forecasts based on the idea that the financial system ‘must’ collapse by next year, etc, always fail, -so far – simply due to the extraordinary measures which have been, and will be taken.
I tackled a banker about this the other day: same as the rest of us, apprehensive, ‘it can’t go on much longer’, but utterly unable to time it. Has taken refuge in London real estate and Swiss Francs. Notably more pessimistic than usual. Having already lost money on the London property has something to do with that! A former colleague of his on the other hand, a gambler by nature, made a killing on student properties in Ireland, buying them up after the crash – walked away with a profit of £10 million or so.
It is going to be fascinating to see how they – the CB’s – deal with the coming recession. As I can’t even buy a Swiss banker a cup of coffee, let alone have an account there, the only hope is to float on the storm waves like a cork…..
As they say, ten-baggers are a plenty.
You just have to be open following pretty obscure topics and diverse circles to spot them though. For example, TSLA was identified right a way post 2009 reflation as the prime candidate, and it was hotly discussed since 2012 short squeezing territory. To same degree all the known big tech stocks going bananas today. A bit more obscurish, although well discussed in some circles was the “triangle of doom” situation on oil and energy utilities falling down in late 2014/2015. Another big opportunity was the sequential Trump-Hofer election via Irish/Scottish online bookies. I did identify (mostly standing on shoulders of old giants) these ten-baggers ahead, discussed it openly, participated only in the second and third case though, with relatively few funds allocated anyway. I’m of the opinion that “fast & easy money” usually (by natural law) tend to be blown into the wind afterwards either on frivolous crap or badly thought out next round investments. Obviously, it’s a human nature reaction afterwards to be bitter why on earth not putting more into it..
But you see, in aggressive mode a decade like this can make dozens of thousand% of profits, so in simplification aggregating such hot accumulations over the ~150-200yrs cycle makes pretty tremendous pathological inroads into the ways how society operates..
LOL funny stuff. All I know is that after tax I made enough from TSLA to buy one.
See I knew it was BS but the .gov was in on the scam so I just went along with the ride
The chap who made the £10 million is, of all things, drinking himself into the grave. One of the most obnoxious people I have ever met. Will his money outlast him? Good for the wife and kids, perhaps…… 🙂
I think that most people I know who are employed in finance understand that the mother of all collapses is baked into the cake — they don’t get the energy angle — but they can see that the situation is completely dependent on the CBs …. and they recognize there is no perpetual economic motion machine…
Asked what do you think happens when the blow out companies one friend said -we’ll all just be a lot poorer…..
Keep in mind these are ‘mini masters of the universe’ types — hyper confident that they have the intellectual capacity to overcome anything…. and they have been trained to believe that ‘they’ (the masters of the universe) will work it out.
I would so enjoy to be able to see the looks on their faces when they realize ‘they’ have lost control…. and there will be no reset
That would be beyond priceless
http://www.fmvmagazine.com/wp-content/uploads/2012/05/Fear.png
Same here FE, many people I know in finance expect a big crash à la 2008, but they don’t understand that it will be permanent….That Industrial Civilization will hang it’s “Closed for Business” permanently….they think because they have money, they will be okay…they are in for a big surprise (albeit short, since they (and us) won’t be here for long afterwards…)
I think this mentality is to a large extent driving the property markets…. I suspect people believe that if they own bricks and mortar then at least they will have assets in the event of a total meltdown — and perhaps a currency reset that destroys the value of their cash…
I also think there are a lot of people who can’t wait for round two …. they will have been honing their strategies after observing what happened during and after round one…..
But all of these strategies involve the expectations of a reset.
That ain’t gonna happen.
They would be far better off wasting their powder now on enjoying what little time is left.
That is the downside of failing to see and understand the big picture….
Now let me think…. how can I take advantage of this knowledge …… what can I do today … that I won’t be able to do in the near future…. that makes me feel joy….. ah yes… I’ll head up the road to this place for a chalice of wine and a spot of lunch:
https://holidayhouses.tmcdn.co.nz/hh/full/67/2563767.jpg
Exactly FE, the way we profit from this “inside information” regarding the end of BAU is not useless investments in RE, gold, paintings etc…the way we profit is enjoying every.single.day BAU is in place!!!
Rather than speculate, why not simply ask Gail what motivates her to host OFW?
Gail?
I host this site because I am seeking to determine the truth about how the economy is affected by limits of a finite world. Comments from readers help me see areas I am missing, and things that aren’t really sinking in. Also, they often point out news items I should be aware of (by email and in other forums, besides on the comments to OFW).
Thank you very much for the site. It must be difficult and time consuming to write a new article every twenty days and to reply to so many comments as you do.
Before coming across OFW I knew industrial civilization was going down and taking most humans with it. But I had expected a gentle downslope with the death by a thousand cuts continuing for many years yet. OFW has given me understanding of the importance and precariousness of our financial situation. Financial collapse is inevitable and whether it will be possible for TPTB to hold everything from falling apart after that is doubtful.
To quote Gerald Celente when it all fails they take you to war.
Saudi Arabia declares all atheists are terrorists in new law to crack down on political dissidents
(Religion- welcome to the 11th Century)
https://www.independent.co.uk/news/world/middle-east/saudi-arabia-declares-all-atheists-are-terrorists-in-new-law-to-crack-down-on-political-dissidents-9228389.html
Saudi: No.1 allies of the Free World. 🙂
Incredibly brave to be an atheist in an Islamic country, to the point of utter stupidity….. I can’t imagine anyone declaring themselves to be that. I should imagine that it will be used as a false charge to get rid of people.
My Iranian friends went along with the whole piety thing, pretended to fast, learnt the Koran, etc, as to do otherwise was a death sentence.
And yet we want to let them in…Just cant fix stupid
In Australia the government commissioned a study on peak oil and then tried to repress the study because of the panic that might ensue.
In retrospect, was the peak oil study right? I expect that it frames the problem badly. This is an issue, in and of itself. I expect it talks about coming high prices and short supply.
Source? I did some Googling, but couldn’t find anything.
I believe Matt Mushalik in Australia is the one who wrote about this issue back in early 2012.
http://crudeoilpeak.info/australian-peaky-leaks-goes-mainstream
http://crudeoilpeak.info/australian-peak-oil-report-ignored-for-urgent-sydney-canberra-rail-upgrade-peaky-leaks-part2
http://crudeoilpeak.info/australian-government-kicks-own-goals-in-senate-peak-oil-debate-peaky-leaks-part-3
The reason for the urgently needed Sydney Canberra rail upgrade was the coming of Peak Oil.
Trump acted like a ‘loud and tacky drunk tourist who steps on others without realizing’ during his meetings with foreign allies, claims State Department official
Read more: http://www.dailymail.co.uk/news/article-4551896/Trump-acted-like-tacky-drunk-tourist-abroad.html#ixzz4iceeGOWz
The other day I saw an ad in a newspaper flyer for a truck and the offer was $15,000 cash back. Oh no we’re not desperate at all.
https://www.bloomberg.com/news/articles/2017-03-28/-deep-subprime-becomes-norm-in-car-loan-market-analysts-say
Next year they’re coming out with reverse mortgages on your unborn child’s future house.
Uh, no. You are losing it Cliffy. Remain calm. Next year will be a lot like this year.
And then 2 years after that, in 2020, we.are.done 😉
Print to infinity Kurt what could possibly go wrong.
Lower prices on new trucks through rebates has to translate to lower prices for used trucks, and less money available for down payments.
“Next year they’re coming out with reverse mortgages on your unborn child’s future house.” – You could get a job in the finance industry!
“Reverse mortgage on unborn child’s future house” now there’s an untapped market for the financial industry. But, I would prefer to invest in this new “growth” industry after the mortgages are bundled and securitized, or just invest it’s derivatives. Lol
Not sure if I should laugh or cry.
Signatures will soon be obsolete. Soon applicants will simply arrive at the dealership and the salesman will place a mirror under their nose. If it fogs ” Congratulations your approved how many would you like to buy today we’re selling them in pairs”
LOL!
This Is One of the Most Worrying Signs of Economic Collapse
https://www.lombardiletter.com/this-is-one-of-the-most-worrying-signs-of-economic-collapse/12193/
The Hills Group is right again.
I agree with Bruno. I do not associate this with the Hills Group being right.