The Approaching US Energy-Economic Crisis

I was recently asked to give a talk called, “The Approaching US Energy-Economic Crisis.” In other words, how might the United States encounter problems that lead to a crisis? As we will see, many of the problems that could lead to a crisis (such as increased wage disparity and difficulty in collecting enough taxes) are issues that we are already beginning to encounter.

In this talk, I first discuss the connection between energy and the economy. Without this connection, it doesn’t make sense to talk about a crisis arising with respect to energy and the economy. I then discuss seven issues that could lead to a US energy-economic crisis.

Economic Growth Is Closely Tied to Energy Consumption

If we look at world data, it is clear that there is a close tie between energy consumption and economic growth.

Slide 2

On an individual country basis, there can be the belief that we have reached a new situation where a particular country doesn’t really need growing energy supply for economic growth.

Slide 3

For example, on Slide 3, the recent nearly vertical line for the US suggests that the US economy can grow with almost no increase in annual energy consumption. This rather strange situation arises because the standard calculation misses energy embodied in imported goods. Thus, if the United States wants to outsource a great deal of its manufacturing to China, the energy consumption used in making these goods will appear in China’s data, not in the United States’ data. This makes the country that has outsourced manufacturing look very good, both with respect to energy consumption and CO2 emissions.

Buying imported crude oil from elsewhere (such as Saudi Arabia) is also helpful in keeping down energy consumption, because it takes energy of various types to extract oil. If oil extraction takes place in Saudi Arabia, using steel pipes from China, the energy used in extraction will appear in the data of China and Saudi Arabia. Neither China nor Saudi Arabia obtains as much economic growth, relative to its energy expenditures, as does the US. In order to make sense of what is happening, we need to look at the world total.

Slide 4

We see that the pattern of world energy consumption growth follows a pattern not terribly different from that of China. Its growth is not “straight up.” It does take growing energy supply to create additional goods and services. We are getting a little more efficient in this process over time, but energy is very much needed in many areas of the economy:

  • By businesses, to create goods, such as food, and services, such as vacation travel;
  • By governments, to create roads, schools, and other public services;
  • By individual citizens, to cook food, to heat homes, and for transportation.

The World Economy Is Organized Based on the Laws of Physics

There are many self-organized systems that seem to grow of their own accord in the presence of available energy supplies (that is, in thermodynamically open systems). Plants and animals are examples of growing self-organized systems. Hurricanes, ecosystems, and stars are also such systems. Economies also seem to be such systems. The name given to such a system is a dissipative system.

Slide 5 – Source:

I visualize the world economy as being somewhat like a child’s building toy. It consists of many different elements, a few of which are listed on Slide 5. An economy is self-organized in that new businesses are formed when some entrepreneur sees an opportunity. Consumers decide which product to buy based on which product best serves their needs and based on price. Governments decide on changes to laws and tax levels, depending upon how the economy is functioning at a given time.

This system gradually grows over time, as more businesses and customers are added. As new products and new businesses are added, products and businesses that are no longer needed are taken away. For example, when the private passenger automobile was invented, there was no longer a need to feed and house a large number of horses to be used for transportation purposes. Thus, the system self-organized to eliminate the services needed to care for the many horses used for transportation.

Even if we wanted to get rid of cars and go back to horses, we really could not do so now. In some sense, the structure shown on Slide 5 is hollow, because prior capabilities that are no longer needed tend to disappear. The hollow nature of the economy makes it almost impossible to go backward if we somehow lose our existing capabilities–not enough oil, or an electricity problem, or an international trade problem, or a financial problem. Instead, we will need to build new systems that will function in the new context: depleted resources, a very high population level, high pollution levels, and degraded soils. The existing self-organized system is likely to collapse back to only the part that can be sustained.

Slide 6

Slide 6 is a preview of where this presentation is headed.

Slide 7

Slide 7 describes the issue most people are concerned about: oil prices will rise too high for consumers. In fact, we clearly have had problems with high prices in the recent past. The high prices in 2007 and early 2008 seem to have punctured the debt bubble that existed at that time, as I discuss in an academic article, Oil Supply Limits and the Continuing Financial Crisis.

Shortly before oil prices started to turn back up again in late 2008, the United States instituted a policy of Quantitative Easing (QE), in an attempt to bring interest rates down and thus encourage more debt. Additional debt at low interest rates can “pump up” the economy in several different ways:

[1] Some of this low interest debt can be used by governments to provide funding for unemployment benefits and projects such as road building.

[2] Some of this low interest debt can be used by businesses to open new factories, and thus hire more workers.

[3] Some of this low interest debt can be used by individual citizens to purchase a home, a car, or a college education.

It is the pumping up of the economy with low interest debt that seems to stimulate the economy in a way that raises oil prices. When the US discontinued its third and last phase of QE in late 2014 (shown as “End US QE3” in Slide 7), the pumping up action began to disappear, and oil prices again fell.

Slide 8

The figure in Slide 8 may seem a little exaggerated, but I wanted to make a point. Our wages can roughly be divided into three pieces:

[1] Essential goods whose prices are very much influenced by the price of oil, such as food and gasoline. Besides food and gasoline, the cost of replacing a road, particularly with asphalt, very much depends on the price of oil. Higher costs for roads will be reflected in taxes that we are required to pay. Almost any kind of product that is shipped is affected by the price of oil, because oil is the usual transport fuel. Oil is typically used in the extraction of metal ores, so the price of metals used in making cars, appliances, and other goods is affected by the price of oil. Thus, an oil price increase indirectly leads to inflation in the cost of a wide range of essential goods and services.

To make matters worse, fluctuations in the price of oil can be very large. Between 2000 and 2008, we saw monthly average oil price fluctuate from under $20 per barrel to over $130 per barrel. Thus, while the growth in the food and gasoline segment is somewhat exaggerated, the impact of price changes is much larger than a person might expect, looking only at the impact of higher gasoline prices for a consumer’s vehicle.

[2] Repayment of loans, such as mortgage payments and auto payments. Loan repayments of these types tend to make up a large portion of most people’s spending. If people don’t own their own home, they have rent payments to make. These rent payments are in some ways similar to loan payments, because they indirectly cover the cost of someone else’s mortgage. These costs tend to be fixed, even if the price of oil goes up.

[3] Everything else. These are the non-essential items that we cut back on when budgets are too tight. Examples include charitable contributions, visits to restaurants, and vacation trips.

Looking at Slide 8, it becomes clear that if a government wants to “counteract” high oil prices, it needs to lower interest rates. This will tend to make car payments, mortgage payments, educational loans, and even rents somewhat more affordable, at least for people whose loans are affected by the new low interest rates. Often, homeowners are allowed to refinance, to take advantage of the new lower interest rates.

The plan this year is to raise, rather than lower, interest rates. Needless to say, this has the opposite effect; it tends to reduce the size of the “everything else” segment of our income. This effect tends to be recessionary.

Slide 9

Monarch Air is a British airline that failed recently. It boasted very low fares. One of the problems leading to its failure was a falling pound relative to the US dollar, raising both the price of oil and the price of new airplanes.

Today, the price that oil producers need, including adequate funds for (a) reinvestment and (b) the high taxes that governments need to continue their programs, is likely $100 per barrel or more. Such a price would likely cause recession, because purchases in the “Everything Else” category on Slide 8 would be squeezed.

Slide 10

Most people don’t think about the possibility of oil prices falling too low for producers, but this is a major problem today. When prices are too low, oil companies need to borrow money to continue to operate. They are likely to cut back on developing new extraction sites. With low prices, the tax revenue that the governments of oil-exporting countries are able to collect tends to fall too low, leading to cutbacks in government programs and a need for more debt. Saudi Arabia is running into this difficulty.

The problems that arise from low oil prices can be hidden for quite a while, because investors are likely to see the low prices as a great opportunity. They think, “Surely, oil prices will rise again.” So investors are eager to buy more shares of stock, and banks are willing to issue more debt. At some point, the situation becomes unsustainable, and no more loans are offered.

It has now been about three years since prices fell to a level that is clearly too low for oil producers. It cannot be many more years before something has to “break.” Venezuela is an oil exporter that cannot collect enough revenue from oil exports to afford needed goods, such as food. Other oil exporters may eventually encounter similar problems.

Slide 11

A major reason for falling oil prices is growing wage disparity and the resulting loss in purchasing power for the bottom 90% of workers. In the United States, the bottom 90% obtained about 62% of total income as recently as 1992. In a 2016 Federal Reserve survey, only 49.7% of total income went to the bottom 90%.

The reason why wage disparity is important is because the wealthiest 1% (or even the wealthiest 10%) can’t purchase very much of the goods created using oil. The wealthiest 1% can’t eat very much more food than everyone else. They can only drive one car at a time. In order to have adequate demand for oil, the bottom 90% must have adequate purchasing power for goods such as homes and cars. If young people live with their parents longer, and aren’t able to afford homes, this holds down demand for oil. So does transferring manufacturing to countries where wages are so low that few people can afford cars and other manufactured goods.

Slide 12

Slide 12 shows the Federal Reserve’s graph of the share of families who own (as opposed to rent) their primary residence. There has been a drop in homeownership from 69% in 2004 to less than 64% in 2016. This is a period when wage disparity has been increasing.

Slide 13

Wind and solar are intermittent sources of electricity. They work adequately well in applications where intermittency is no problem, such as charging a cell phone that has a battery, or powering a desalination plant that is not expected to operate around the clock. Most analyses of the benefit of wind and solar are suitable only for these limited situations, because they omit any estimate of the cost of mitigating intermittency.

Intermittency becomes a major problem when wind and solar are added to the electric grid. Wholesale electricity prices may drop to very low levels when both wind and solar electricity are available. At times, prices may become negative. Electricity generation that is designed to be used most of the time (such as coal, nuclear, and even some types of natural gas generation) cannot survive without subsidies to offset the artificially low prices the system produces. The need for subsidies for backup electricity providers is really an indirect cost of adding intermittent types of electricity to the grid, but today’s pricing does not reflect this.

A different workaround for intermittency is to add a large amount of battery backup or other type of storage. In theory, batteries could be used to store electricity generated in the summer for use in the winter, when heating needs are greatest.

Another approach to intermittency is to greatly overbuild intermittent renewables, with the idea of using only that portion of electricity generation that is really needed at any point in time. Yet another approach is adding extra (lightly used) long distance transmission, to try to smooth out fluctuations.

Any of these approaches tends to be expensive. Academic papers estimating the benefit of wind and solar nearly always overlook the cost of mitigating intermittency. Thus, they suggest wind and solar can be solutions, when, in fact, their high cost is likely to lead to the same damaging economic effects as high oil prices. (See Slide 8.)

Slide 14

The dotted line on Slide 14 shows the downward trend in German wholesale electricity prices, as more and more intermittent electricity has been added to the grid. At the same time, total residential electricity prices have risen to higher and higher levels. The countries with the greatest use of wind and solar tend to have the highest retail rates, as shown in Figure 1 below (not in presentation).

Figure 1. Figure by Euan Mearns showing relationship between installed wind + solar capacity and European electricity rates. Source Energy Matters. (Image not part of presentation.)

Slide 15

As we discussed earlier, the “standard” workaround for high oil prices is low interest rates, because of the relationship shown in Slide 8. At some point, however, interest rates fall about as low as they can go.

Slide 16

The interest rates shown on Slide 16 are those for 10-year treasuries. These typically underlie mortgage rates. These rates have been falling since 1981, helping to prop up prices for homes, land, farmland, and other assets purchased with long-term debt. Low interest rates make monthly payments more affordable than high interest rates, so more people can afford to buy such assets. With greater demand, asset prices tend to rise.

Also, with all of the talk about the US continuing to raise interest rates, those owning bonds realize that rising interest rates will cause the selling price of bonds they hold in their portfolio to fall. Thus, pension funds and other organizations that are making a choice between buying bonds (which are certain to fall in selling price, as interest rates rise) and buying stocks, will choose to “overweight” stocks in new purchases for their portfolios. This will tend to push the price of stocks higher, regardless of the earnings potential of the underlying companies.

One thing I didn’t mention in the presentation, but is probably worth pointing out here: Short-term interest rates have been rising since late 2014, even as 10-year treasuries have been holding fairly steady (Figure 2, below). These shorter-term interest rates affect payments on other types of transactions–adjustable rate mortgages and auto loans, for example.

Figure 2. Chart showing 3-month, 1-year, and 2-year interest rates. Chart created by St. Louis Federal Reserve.

These short-term interest rates have been creeping upward, indirectly making certain types of goods less affordable. The increase in short-term interest rates will, by itself, push the economy in the direction of recession.

Eventually, the bubble in asset prices can be expected to collapse, as it did in 2008. Perhaps this will happen when corporate profits fall too low; perhaps this will happen when the economy hits recession. The prices of many types of assets, including shares of stock, prices of homes, and prices of businesses can be expected to fall. There are likely to be many debt defaults in the governmental, business, and personal sectors of the economy. In such a situation, banks may fail.

Slide 17

The goods and services that are delivered each year require the use of physical resources such as oil, coal, natural gas, metals from ores, and wood. In the past, the quantity of these physical resources has grown, year after year, as illustrated in Scenario 1.

In a finite world, we cannot expect the amount of physical resources to grow, indefinitely. At some point something will go wrong, and the amount of resources extracted each year will start becoming smaller, as in Scenario 2. In a sense, the people of the world can expect to become poorer, because the quantity of goods and services that can be made with these resources grows smaller, instead of larger, and each person’s share of the world output becomes smaller.

Standard economic theory says that resource prices will rise, as the quantity of resources falls, but this view does not take into account the way a networked economy really works.

A more likely scenario is that as the quantity of resources falls, wage disparity will increase. As a result, the incomes of many of the lower-wage workers can be expected to fall. The problem is that jobs that pay well require the use of resources; if there is a decrease in resources available, some jobs are likely to be eliminated. Today, such job elimination may come through added technology, eliminating what were previously low-paid jobs. Studies of past collapses support the view that falling wages for the working class played a major role in these collapses. (See Secular Cycles by Peter Turchin and Surgey Nefedov.)

With greater wage disparity, a smaller share of people will be able to afford to buy homes and cars. Scenario 2 in Slide 17 will occur, not because we “run out,” but because too few people can afford to buy goods made with oil, gas, coal, metals and wood. Market prices will fall below the cost of extracting the necessary resources, and companies in these businesses will fail. Governments of oil exporters may collapse, because they cannot collect sufficient tax revenue at the low price available on world markets.

Slide 18

If there are physically less goods and services available, who will get the benefit of these goods and services? I see the situation as almost like musical chairs. Will it be pensioners who lose out, as bonds held by commercial pension programs default, and also as governmental plans are cut back? Or will it be the wages of the less skilled workers that are cut, as more processes are automated, and only managers and highly skilled workers are needed? If this happens, won’t commodity prices fall even further? We really need to have adequate wage levels for a wide range of workers, if we expect to have enough buyers for the goods produced.

Historically, when collapses have occurred, governments have lost out in the game of musical chairs because they could not collect enough tax revenue. The problem was that the bottom 90% of workers became poorer and poorer, and so less able to pay taxes. This brings us to our next potential US problem area.

Slide 19

In January 2017, the US Congressional Budget Office made a projection of how federal debt held by the public would grow, based upon the information available at that time. Their forecast was that the debt would grow to amount to nearly 150% of GDP. This would be a much higher level than during World War II, World War I, or the Civil War (Slide 19).

Slide 20

Since January 2017, more information has become available. We now know about three hurricanes, plus fires in California. Citizens affected by these events need financial support.

We also know about proposed legislation to reduce taxes, especially for businesses and high-income individuals. These proposals are likely to increase after-tax wage disparity, and increase the amount of the deficit. If corporations choose to return any of the benefit of the tax cut, it will likely be through dividends to those who are already wealthy. With respect to corporate tax rates, we are only trying to catch up with tax havens, so it is difficult to believe that the tax change will result in much more US investment.

Slide 21

We don’t think about the internet as being important, but it has become an essential part of our interconnected world economy. The internet helps facilitate all of the just-in-time deliveries needed to operate today’s economy. All of the fancy workarounds for the use of intermittent electricity on the electric grid assume that the internet will be available to transmit information back and forth quickly. Banks make use of the internet to get information to approve loans and to clear checks with other banks.

In the United States, we seem to hear one story after another about the internet being hacked. The most recent story involves a major hack of the data collected by Equifax for the purpose of determining the credit-worthiness of individuals in the US. If this data gets into the wrong hands, it can be used for “Identity Theft.” An impostor can apply for a new loan in the name of someone else, or can steal an income tax refund intended for someone else.

A different hacking situation in the Atlanta area recently led to the theft of a large number of checks intended for direct deposit in teachers’ bank accounts being stolen. They were instead direct deposited to an impostor’s account.

If the internet is truly not secure, no matter what we do, this by itself could cause major problems for the system we now have in place. We don’t have a “Plan B” available, either. Trying to start over with “snail mail,” for example, would be a problem. This is another illustration of the difficulty involved in going back to an earlier technology.

Clearly this list of potential problems is not complete. Hopefully, this list gives an idea of the wide range of issues we are facing.

About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to financial problems for oil producers and for oil exporting countries. We are really dealing with a physics problem that affects many parts of the economy at once, including wages and the financial system. I try to look at the overall problem.
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2,174 Responses to The Approaching US Energy-Economic Crisis

  1. JH Wyoming says:

    FED claims rate hike expected for December. Remember this article because based on past performance that call for a rate hike is just talk – there is no expected action to take place in December. All the Fed is doing at this point is placating the public with phony comments to kick the can further down the road.

  2. name says:

    Bitcoin mining now consumes 0.12% of world’s electricity supply. Rising by 5 kliowatts per second.

    • zenny says:

      I spent 10 on a Pizza back in the day…Burn more coal I WANT THEM BACK

      • Fast Eddy says:

        Oh .. and calling this ‘mining’ …. that sounds like something that Don Draper dreamed up

      • I looked at part of it. I still cannot see a point to bitcoin. If we have a problem with electricity, bitcoin is clearly gone.

        Someplace I am missing the business model of the whole operation–or maybe I didn’t listen long enough. How is this different from selling, for example, vacation timeshares as a great IRA investment? Doesn’t it depend on finding another sucker to buy it later?

        • Fast Eddy says:

          The fact that these fake currencies are marketed as a way to escape control of the central banks and governments leads me to believe that this is a steaming pile of horse sh it.

          If the CBs want to end this — they simply make them currencies illegal … then instruct the NSA to run a search of its database to see who has engaged in trading of these fake currencies and when the first person is thrown in jail … this ends.

          Of course the CBs could all launch their own fake currencies if they thought there was some reason to… but then they already have unlimited fake currences….

          Why the CBs have not done any of the above … and seem to be tolerating this … now that is a question that I cannot even guess at…

          • Because you have a limited mind.

            From what I’ve read the only way the authorities can shut down the expansion of cryptocurrencies would be to shut down the internet or the power supply or threaten with such.

            Unlimited fake currencies… that they control. The whole point is that decentralisation would take that control away from the criminal CBs. They are dinosaurs trying to squish the fast little mammals running circles around them.

            Trying to make things that are incredibly popular and practical illegal tends not to work i.e. prohibition.

            If you cannot even guess at why the CBs are tolerating this and even trying to play the game then give up now because you will never get it.

            They will try to control this and fail.

            Hint: A principled individual, some shady group, military intelligence agencies, CBs created this whole wave of crypto to lead us all into the land of milk and honey. Take your pick.

            • jupiviv says:

              The CBs are tolerating this because all bubbles today are interwoven and interactive. Bitcoin has only so much value as its ‘decentralised’ users (who live and depend upon centralised systems) believe it has. It will and indeed can never be used for anything other than speculation and e-commerce. Any exceptions you might point out in retort are irrelevant.

            • Slow Paul says:

              Cryptocurrencies are just ponzi schemes.

            • Fast Eddy says:

              From what I know — the NSA is recording what I am typing right now ….

              They record my every digital communication — from emails to posts on web sites to phone calls — everything. And they store it all.

              I do not own any of these fake currencies…. but if I did I would have purchased them through an online trading platform.

              The NSA would have records stored of every purchase that I had made of these fake currencies.

              If the bosses of the NSA – the eld ers — decided they wanted to end this fake currency situation….

              They declare the currencies illegal. They declare that anyone who holds these currencies to be a criminal — they impose jail sentences – the offer an amnesty to declare ownership of these currencies.

              They run a quick google-like search of these records and check to see if there is anyone who has traded these currencies and not declared.

              If they find anyone – they send the FBI to their home — and arrest them — this makes the evening ‘news’ — along with a notice that the amnesty is being extended for an additional 24 hours.

              Anyone not declaring will go to jail – no additional amnesties granted.

              Remember this:

              Executive Order 6102 is a United States presidential executive order signed on April 5, 1933, by President Franklin D. Roosevelt “forbidding the Hoarding of gold coin, gold bullion, and gold certificates within the continental United States”. The effect of the order, in conjunction with the statute under which it was issued, was to criminalize the possession of monetary gold by any individual, partnership, association or corporation.

              Numerous individuals and companies were prosecuted related to President Roosevelt’s Executive Order 6102. The prosecutions took place under subsequent Executive Orders 6111,[7] 6260,[8] 6261[9] and the Gold Reserve Act of 1934.


              It is not possible to hide the purchase of a Bitcoin. The NSA knows all.

              IF the CBs want to kill this — they could do it in a day.

              Explain to me how I am wrong.

            • nope.avi says:


              Bitcoin is not accepted as legal tender. It poses no actual threat to ANY currency. It’s not incredibly popular at all. It just gets a lot of promotion from the press, who is either being paid to promote it or believe it will magically solve economic problems. Cryptocurrencies are nothing more than ponzi schemes –wealthy people exchange real currency for fake currency that cannot be used to buy anything.

              What did you use Bitcoin to buy in the last day or so?

              That’s right, nothing.

            • Fast Eddy says:

              And I don’t imagine it will become incredibly popular… because the CBs could body slam whenever they want to

              This nonsense of ‘this is a way to escape the clutches of the CBs’ is the biggest load of horsesh it I have heard in a long time

              Oh ya… you just make up a new currency on a computer and voila the most powerful entity on the planet is made obsolete…

              Re tard ation is rampant

            • Well… there you go… sometimes you have to push a few buttons to see what reaction you get. And boy… just look at those reactions.

              FE… Yes. Correct. NSA probably behind all this. But it could be any of the interwoven intelligence agencies… it really doesn’t matter.

              You’re wondering why the most powerful entities on the planet would produce the very weapon that would strike them down. These entities know that their time is up. You know that they control the narrative. You know that their tentacles reach through every part of industrial civilisation.

              And I’m sure you’re aware of the principle of creative destruction. Take that up a notch or two to the highest levels of planning. What would you do?

              Create revolutions, start fires here and there, promote novel values, ideas, while demonising the Old World Order. Allow the “people” to bring in a New World while destroying the old one. Position your people with powerful voices in all the right places but essentially still pull all the strings from behind the curtain. Play the role of a dinosaur under attack. Forfeit some of your bigger names. Let them fall. Feed Hollywood to the wolves if need be. Let the new venues replace the old to thunderous applause from the plebs. Let them win the battles… so that you can co-opt the new platforms and territories. Their successes will breed false confidence which can then be exploited.

              Blockchain, cryptos, shades of utopia… it doesn’t really matter what the details are. What’s important is that you instigate revolution so that you can then control it rather than losing all control.

              It works both ways… make ludricous promises and once you’re voted in turn the screws. Or the other way around… bad cop first… then come in with the good.

              But we will see shall we. We’ll see how far this goes and who the winners really are. For now… I’ll say the same players will be pulling the strings whatever money is used to buy cheesy puffs.

              So when you say this…

              “fake currencies are marketed as a way to escape control of the central banks and governments”

              it’s true but only because it was scripted that way. It has to be. People have to gradually believe this is possible for everyone to jump on board. Enough for it to be impossible to police in all countries. And no one wants to shut down the internet or turn off the power so the narrative would move on to the next stage… acceptance and guidance going forward.

              Much like income tax was introduced at a very low rate and incrementally raised over a hundred years and rebels migrated to america to pursue liberty (but look where they are now) a shift in the banking world could be achieved in the same way. The new territory to flee to is the internet.

              But as you say… the illusion of freedom has already been shattered. So what do people hope to gain?

              This is where most people would actually prefer an authoritarian approach to new systems because it maintains the confidence they were used to in the old system. Applying some rules and regulations, checks and balances, would gradually bring all the herd precisely where you want them.

              And then there would be no escape.

            • Fast Eddy says:

              We are out of cheap to produce energy —- there is no ‘next’

              Perhaps this is all about the el ders losing their minds… flailing madly as they desperately try to hold the centre…

              Imagine being part of the core that creates the matrix … and you realize that all that power … all that wealth …. are useless… in the face of peak cheap energy…

              You pound the desk with your shoe … you order your minions around …. you burn witches… you scream … you rant…. you turn the knobs…. you flick the switches… you push the buttons….you lash out….

              But nothing happens…. your machine continues to careen towards total disaster…

              For those who are used to getting what they want… this must be a very unsettling turn of events…

              Like Paris Hilton being turned away by the doorman at a club….

              Or Kevin Spacey being rebuffed by a 12 year old boy….

              Do you know who we are???? DO YOU KNOW WHO WE ARE???? We are the kings of the world… we are the masters of the universe….

              Ya… I know who you are …. f789 you.


            • nope.avi

              Bitcoin spikes after Japan says it’s a legal payment method



              I was refering to previous incredibly popular activities – like booze and sex and drugs and guns and blah blah blah…

              I mean sometimes it works – like gold confiscation – for a while… then it’s open house again.

              If you try to make something like cryptos illegal today – and they haven’t even really become a thing yet – there would be uproar. Not because enough people are using them because it would be viewed as an assault of civil liberties and the right to self determination.

              Promote new territories (land of milk and honey) so that you can control the narrative going forward.

              The reason they’ve got this far and why many banks and businesses are starting to jump on board is because that was probably the plan from the beginning. So yes… I think this is all planned and going perfectly according to that plan.

              The skirmishes, the twists and turns, the ups and downs etc are of no concern to the planners for they know that they will be standing pretty at the end of it all.

            • Fast Eddy says:

              Uproars are generally ignored… or put down…

              Recall the uproar known as Brexit…

              And then there was that uproar in Egypt a few years ago …

              Catalonia has gone rather quiet — ultimatums tend to have that effect…

              And how can we mention uproars without recalling Occupy Wall St….

              Bitcoin could be put out of business tomorrow — and nothing would happen… just like nothing happened when etc when bust….

            • FE… while what you say is true I will start to panic when the planners play the “alien invasion” card. Even if the rulers of this world are completely insane and there’s nothing they can do to remedy the situation, I still feel they have a few more cards up their sleeves otherwise the panic would be more visible. Rats jumping ships and all that.

              On control and popular uprisings, you’re quoting the cases that are not favorable to the cause and hence they are nipped in the bud as you say quite severely and without delay. Has this happened with the blockchain and cryptos? Not yet? Why not? And why is it a darling topic of the press much like Tesla and renewable energy? The revolutions that are granted a free pass are for a reason.

              It’s just a hunch but I think these apparent scams buy us time until something else is rolled out. The something else obliterates the need for the temp scams but the cost will have been worth it to maintain confidence in BAU for a while longer. It’s a very high risk strategy from people with nothing to lose.

            • Fast Eddy says:

              I have not the slightest clue what the agenda is with respect to these currencies… but without a doubt there is an agenda…

              Perhaps something to do with taking the shine off of gold… as I say … no idea….

          • psile says:

            It generates spending.

            • nope.avi says:

              It parts gullible people with their money. There isn’t much need for pillaging in highly civilized parts of world, when relatively affluent people are willing to give away some of their money for absolutely nothing in return .

    • I am sure that bitcoin is using the cheapest to produce electricity, and helping drive up the price for others. I know I read that Iceland had run out of cheap additional geothermal and hydroelectric. They are now asking industrial customers for 4.3 cents per kWh. The article talks about bitcoin operators looking for 2 cents per kWh.

  3. JT Roberts says:

    There has been a few comments on how religion is the “opium of the people” or the substance there of. But why don’t we recognize the religious beliefs permeating the discussions here.

    For example most people would tell you that the medical system is necessary and effective in that it has increased life expectancy and increased general health. As a matter of fact the UN says medical care is a “Human Right”. Is that true or a sales pitch?

    The reality is health is primarily extended by proper hygiene, and nutrition. And also central heating and cooling. Yet the medical community is quick to attribute all the increases to their activity. But as we know correlation is not causation. The reality is the medical community has been able to keep a large number of people alive that might otherwise have died of natural cause or immediately at birth. However they have also misdiagnosed and killed quite a few because of hospital errors. Often the “Medical Miracles” of correcting heart malformations in 21 week old fetuses get a lot press. But seldom do they follow the story of quality of life, or the limited duration.

    Beyond that the medical community fail to talk about the 1billion abortions that have been legally performed in the last 100 years. A very high percentage of which are perfectly health 21 week old fetuses and the like. So avoiding and moral implications the raw data would suggest that the net affect of having a medical system in material terms is really a poor investment. Proper hygiene, nutrition, and housing have a much greater affect and would in the absence of the medical profession lead to healthier, younger and more productive people.

    Without even adding Oxycontin to the discussion who is really the “opium of the people”?

    There are many other sacred cows that can be “tipped”. Credulity isn’t faith or religion, rather it’s a lack of education.

    • Having worked in the medical malpractice industry, and having had a physician for a father, and also having looked at some of the data, I can definitely agree that physicians have played a much smaller role in the health of the nation than most have assumed. Good nutrition and proper hygiene are much more important. Even within that “economic class” or “education” seems to be terribly important–the well-educated tend to live longer. Also, countries with smaller wage disparities seem to come out better in terms of health outcomes. Married men do better than single men, but that may represent a “selection” bias–women don’t marry men (or stay married to men) who have clear problems, such as being alcoholics.

      I am on the other side of the abortion debate. I have no problem using abortion to keep the population down, or to avoid giving birth to a child a mother doesn’t want to raise.

      With the huge amount we pay to the medical system today, there is the assumption that it can really do something for us. It can do a little bit to help our body heal itself, but not a whole lot more than that. We have been able to work around the system of “survival of the best adapted” with the health care system. This tends to mean that the next generation is less well adapted than today’s generation. It is not really the result we should want.

      • zenny says:

        I have a hard time understanding abortion and the death penalty.
        My POV
        Abortion. Why are we killing our own kids and bringing or importing others in. If it was to keep the population down OK it is not a hard limit.

        Death penalty. IMHO we can learn things from the likes of the Truck of peace driver in NY not if he is dead tho.

        • nope.avi says:

          There has been plenty of research on criminals. Keeping them in prison doesn’t seem to change most of them for the better.

          • zenny says:

            @nope That is true…It is not about fixing them. BUT if we used the population that they self identified with and treated them as if they were home things would get better in a hurry.
            African and Mexican governments keep people alive on a few dollars a day.

            • Fast Eddy says:

              Perhaps we should build special washrooms for them as well?

            • nope.avi says:

              ” It is not about fixing them. BUT if we used the population that they self identified with ”
              I have no idea what you are trying to say here. It sounds like sociology word salad…and it’s incredibly vague. Try again.

              “and treated them as if they were home ”

              When they were at home they were committing crimes. Common sense says that if you put criminals somewhere to be punished or corrected, then the criminals should be punished or corrected, or else, why bother?

              ” things would get better in a hurry.”

          • the ultimate problem with criminals is the cost to the public purse

            300 years ago in uk, you could be hanged for any crime where the value of the theft was greater than one shilling (1/20th of a pound)–why? because maintaining jails was unaffordable, and police forces were too thin on the ground to be effective

            then we started shipping criminals to America and the Australia as an alternative.

            Now we can’t do that anymore.

            As social conditions worsen and police forces get weaker (both through lack of energy resources) one can only assume that punishments will become increasingly severe, as they were 300 years ago

            • Greg Machala says:

              Today it is profitable for some folks if more people are put in prison. The prosecutors, defense attorneys, judges, the prison workers, the prison builders and maintenance personnel and those who provide the meals and supplies to prisons all benefit.

            • Fast Eddy says:

              Castro did the same thing!

      • Fast Eddy says:

        Can I go further and suggest that abortion should be legal up to say… the age of 7? Culling the most irritating of brats can only have positive implications for everyone involved.

        Also — for the Green Groopies who realize after the fact that children are deadly to the environment… this would give them a way to make amends…

      • MudGod says:

        There is nothing on the face of this earth more miraculous, more sacred, more divine than the conception of a human being. That is what defines our existence, it is the essence of our existence. It is the prerequisite of liberty. What could possibly deserve more protection.

        • Fast Eddy says:

          If you have a couple of hours of free time…

        • Artleads says:

          “What could possibly deserve more protection.”

          The few remaining large wild animals–something like 3% of the non human and domestic large animals. This enormous dearth of wild animals is due to the proliferation of humans living as if they had divine rights. If you think that humans have divine rights to existence, then you can’t believe that other complex life have the right to existence. You then have to countenance a life (Orwellian as it might be) with no wild animals at all.

          IMO, the genetic structure that makes up a human is not essentially human. To be human might well be a matter of socialization, not a matter of your fleshy substance. A humanoid born with no brain and the ability to contribute to human society is not human.

          {“In his novel ‘Nausea’ Sartre contents that man as existent is a mystery, a paradox and his nature and purposes cannot be summed up neatly in any formula. Man does not live as pure existence, but he may become aware of himself as such in the experience of Nausea. Roquentin, discovers in Nausea: “the essential is contingency. I mean that, by definition, existence cannot be identified with necessity. To exist is to happen without reason…. Every thing is purposeless. This garden, this town and myself.” (5) Here Roquentin is immobilized by the feeling that his own life together with all the world, is meaningless.}

        • MudGod says:

          Thanks for helping make the point that all life is sacred.

        • JMS says:

          “There is nothing on the face of this earth more miraculous, more sacred, more divine than the conception of a human being.”

      • Niels Colding says:

        Vaccination programmes?

      • JT Roberts says:

        My point on abortion is that the material consequences of destroying perfectly healthy life creates a sick aged society. Demographics plays a large part of societal decline. All the pensioners today are scratching their heads why the system is collapsing. They forgot that investment needs to be made in people not money.

        Now I will agree that you can’t legislate morality and ultimately abortion is a moral issue. However it isn’t in the best interest of society materially to insist on preserving one child because of genetics and not another. Really what has developed is a form of state sponsored eugenics. I’m forced to accept the cost of both the free choice of a mother killing her child as well as a mother preserving one that will be unable to live. Dare society say it’s not in our best interest and the talons appear.

        Wealth is a product of a healthy productive society not the accumulation of gold, or precious pieces of paper. If a society doesn’t invest in its people it is doomed.

        • Theophilus says:

          I have often wondered if in America our doctors kill more people than they save.

          Especially if you consider this from the point of view of years of life terminated compared to living years extended. Also lets be mean with our calculations and not give doctors credit for births, since babies have been being born into this world long before modern medicine. But also, to be generous, let’s not consider those poor souls who have their lives shortened because they received poor medical care.

          Therefore, every baby will kill in the womb we destroy about 80 years of expected life. If a doctor successfully treats a cancer patient and adds an additional 20 years to that person’s life, the doctor would have to do that four times in order to offset the loss of life of one abortion.

          In order to fully run this calculation you would need to multiply all abortions times average life expectancy. That should be easy. The other side of the equation would be more difficult. All life extending medical procedures multiple by average life extension in years.

          It’s times like this I wish I was an actuary. Oh wait, I think we have one. Gail can you help us out?

          With love toward all,

          • The problem with heart disease and cancer is that they tend hit in later years. If they don’t end your life, something else likely will instead, long before 20 years are past.

          • Jarvis says:

            It would be interesting to find out how patient mortality was affected during a Doctor strike?

            • An electricity outage might be a problem, without backup, because portable oxygen compressors and dialysis machines would not be working. It seems like doctors on strike would be less of a problem.

    • Fast Eddy says:

      I demand free health care! And another case of soda….

      • thestarl says:

        My wife is a clinical nurse specialist in wound care working in community health.Over 50% of her patients suffer diabetes related issues.The majority are overweight and are the product of bad lifestyle choices

        • Fast Eddy says:

          Weaklings…. of mind and body….

          • Yorchichan says:

            Victims too, of lack of proper education on what constitutes a healthy diet, of a food industry that puts profit before people and of poor parenting. I am always sad to see kids who are fat through no fault of their own.

            • Mark says:

              It can even go beyond that, some may find this interesting, this is the shorter version.

            • Over 4 million views! Wow!

              I think all of the computer use keeps young people (boys, especially) away from thinking about marrying and having a family. Other issues may be involved as well.

              He makes some good points. Fast Eddy comes from a very Catholic view of religion. For those who are not Catholic (or not raised in Christianity at all), this is a strange view.

            • Fast Eddy says:

              I am not so forgiving….. the information is there … most people by a certain age understand what is good for them and what is bad for them…. most choose bad… and continue to choose bad….it is easy to choose bad….

              But then if you offer any other animal access to unlimited food …. the result will be exactly the same ….

              At the end of the day we are just a branch of ape — with a few seriously f789ed up strands of DNA….


        • There comes a point where you have to stop helping those who can’t help themselves.

          The american food industry is to blame. All of these products create addictive habits. Certain body types – no fault of their own, born that way – put on weight more than others and end up with all the related illnesses which feeds the pharma industry.

          I’m wondering though… why were there obese people in the middle ages? It’s in all the paintings and movies… so it must be true.

          Obviously bigger boned body types are suceptible to gaining weight even with organic food… overeating calories and no exercise is enough. They may have been slightly healthier due to no ill effects from refined sugars and flours and all the other goodies but they were still fat.

          Alchohol, tobacco and other drugs were also widely available so not much difference there.

          • I think that there is also a “missing nutrient” problem. Today’s food is lacking one or more elements that the human body requires. Vitamin K2 is a suspect. Animals who eat food with chlorophyll seem to be able to transform Vitamin K1 into K2, but humans seem to be less able to do it. Today’s factory farms give us grain fed animals which are lacking in K2 (also Omega 3 carry acids). Certain fermented foods, including Natto in Japan, also have Vitamin K2.

            At the same time, the food industry has added a whole lot of chemicals to the food supply that seem to provide desirable characteristics–made the dough easier to work with, or give a pleasing color or flavor, or give the product longer “shelf-life.” These chemicals have not been tested in the quantities that people are now using them, and they certainly have not been tested for years, in close interaction with other undesirable chemicals (from plastics, pesticides, etc.). Different bodies react differently to all of these.

            There may also be an “overly processed” problem. Our bodies recognize the food that hunters and gatherers were able to eat and cook. It does not recognize all of the sugars and white flour we feed it. Some people’s bodies react worse to this than others.

            In the US, poor people tend to eat a worse diet than others, exacerbating the problem. Some people realize that a person really needs to seek out the “correct” kinds of food. Doing so requires home cooking of most food. Not everyone has the luxury of enough time and money for this.

            • Education on these matters doesn’t seem to help much either. If it worked, then the market would respond.

              Why are supermarkets full of packaged artificial food? If they only had fresh and dried produce that would help.

          • they were all better off and thus able to buy more food

            you cant be an overweight peasant if you have to work 12 hours aday just to eat

          • xabier says:

            Until the social reforms of the 20th c, it was often noted how fat (if not jolly) the priests of Spain and Italy were, while their flocks might be half-starved.

            • neil riley says:

              Fully starved peasants in the great Irish famine, when no clergy died of hunger. You don’t often hear about this – just the greedy landlords.

          • Fast Eddy says:

            Everyone knows someone — or a lot of people — who say they gain weight by just looking at food…

            I am dubious of these claims…

            If you are a fat f789 the formula is simple — you take in 5000 calories per day … and you burn 2500.. you will eventually look like this


            Yes there were fat people 300 years ago … but few and far between… because most people struggled to balance the energy in energy out equation

      • Theophilus says:

        To be fair, he may have been reaching for the diet soda. Lol

    • JT Roberts


    • Slow Paul says:

      The increase in life expectancy for the last century (from about 50 to 80 years) is more or less due to the discovery of antibiotics and invention of vaccines that has kept infectious diseases at bay. These are cures in the proper sense of the word. But of course living conditions, hygiene and sanitation has improved during this period as well

      Did you know that bacteria are able to transfer their resistivity to antibiotics horizontally to other species of bacteria? It’s like the bacteria are infecting each other, becoming ever more pathogenic.

      Another fun fact, 70 percent of antibiotics used in the world is in food production. Pigs, chicken etc. So our appetite for cheap meat will not only make us sicker, but also make the cures less efficient.

      • Right. Also, the antibiotics in meat can affect the flora in the human gut, making it sensible to avoid meat raised with high levels of antibiotics.

        The antibiotics and vaccines, rather than the physicians themselves, are things that have increased our life expectancies, and those of people around the world, including Africa. All of the work on heart disease, cancer, and other diseases has had much less effect.

        The death rate in childbirth was very high at one time. I am not sure exactly what brought it down, but cleanliness was part of it. Cesarian sections are today very much overused.

        • xabier says:

          The death-rate in childbirth in Britain started to decline in the first half of the 18th century: better hygiene to some extent, more sophisticated procedures. And maybe better nutrition as a consequence of the wealth brought by Empire and trade. By 1800, life was a lot better than in 1600.

        • Fast Eddy says:

          In Hong Kong it is common to cut a baby out on an auspicious date….

          Aren’t we humans so brilliant!

          • When I had my son on December 17, the maternity ward was overly full because of all of the ladies who were being “induced” so that they would be out of the hospital on December 25. The doctor didn’t want to work then, and Moms wanted to be home for Christmas. I suppose that makes December 17 an auspicious date.

        • If God was kind… he wouldn’t have made childbirth so bloody difficult.

          • When my father used to deliver babies, he used hypnosis. He taught his patients during pregnancy. It seemed to work pretty well. It was not an approach encouraged by those selling medicine, however.

      • Fast Eddy says:

        We underestimate the impact of pent up disease will do post BAU…

        This could be worse than the spent fuel ponds and starvation

    • DJ says:

      For me this means there is very little progress in health care, only new/better ways to increase life span by applying surplus money.

  4. Fast Eddy says:

    Comment from Tim Morgan – surplus energy site:

    Indeed. Perhaps I can best comment with a summary narrative. With growth decelerating, the authorities, being unwilling to adapt to this, instead unleashed credit adventurism in or around 2000. This led to the 2008 GFC, which effectively forced them into monetary adventurism. This is inflicting almost incalculable economic damage, and, as I see it, must create a second and worse crash.

    Of your alternatives, neither deleveraging nor higher rates – positive rates in real terms – seems to me possible, politically and perhaps financially. Curbing credit creation would undercut demand, inducing a severe recession/depression, whilst higher rates would puncture asset bubbles and crash property markets. I can’t see politicians contemplating this for one moment.

    So, as I see it, ‘the die is cast’, or the next crash ‘is hard-wired’ into the system. Policy responses to GFC#1 seem to me to make GFC#2 a racing certainty.

    • Also, diminishing returns with respect to fossil fuels that led to the first crash will make certain of a second crash.

    • theblondbeast says:

      It was a response to a comment of mine. I was trying to distinguish that many people of the zerohedge/goldbug ilk see the money side of the issue and WANT a collapse because they believe there is the possibility of returning to endogenous growth of the economy. I do not believe this is possible largely due to the real wages / labor dilemma Gail addresses here. I can’t quite connect the dots directly from diminishing returns of fossil fuel to why the demand for labor cannot rise faster than increases in population and productivity (resulting in higher wages). But my guess is that it is diminishing returns of technology (first you get tools which help workers, then you get machines which replace them).

      I had a thought that one stop gap may be to keep interest rates very low while simultaneously increasing a wealth tax on inflated assets.

      • nope.avi says:

        ” can’t quite connect the dots directly from diminishing returns of fossil fuel to why the demand for labor cannot rise faster than increases in population and productivity (resulting in higher wages). But my guess is that it is diminishing returns of technology (first you get tools which help workers, then you get machines which replace them).”

        We have too many workers. Only high demand and high wages can make demand for labor rise faster than increases in population and productivity. The only way demand can be made high enough to achieve that is with massive credit bubbles because wages and profits have been on downward trajectory for 40 years now, at least. When wages and profits go down, so does demand. Unfortunately, credit bubbles cannot permanently reverse the conditions that are leading to lower profits for businesses and lower wages for workers.

        “I had a thought that one stop gap may be to keep interest rates very low while simultaneously increasing a wealth tax on inflated assets ” I’m going to guess that keeping asset prices within a narrow range, in a market economy, where they produce JUST the right results is close to impossible because no government has achieved in reaching the perfect cost for any asset.

  5. Baby Doomer says:

    Sears Depletes $200 Million Loan in Latest Sign of Cash Burn

    Sears might not make it to see Christmas this year….

    • nope.avi says:

      The best description of Sears that I have heard of is that it is a relic of a 1990s economy.

      I think it is a relic of cheap energy and rising purchasing power (increasing supplies of cheap energy) for the average worker.

      • Fast Eddy says:

        Isn’t everything…..

        • nope.avi says:

          Nope. The various “dollar” retail chains, where costs are whittled down to the bone and the items for sale are low quality, are thriving in response to lower economic growth. The growth of luxury retail chains is also a response to lower economic growth.

          Retail outlets that cater to the middle class are the ones getting hammered.

      • Back when machines were easy to fix, Sears was the one who kept a good supply of replacement parts. At one point, long before that, a person could buy a kit to build your own house. All a person needed to do was add a lot and labor. Now that everything is so complex, the do-it-yourself days of Sears are over.

  6. Harry Gibbs says:

    I was intrigued to spot this morning in a reasonably mainstream publication a casual acknowledgement that an oil price spike could push the US into recession:

    “”Maybe it will start with a failed initial public offering, followed by the revelation of widespread fraud in Silicon Valley. Perhaps energy prices will spike, sapping the finances of anyone who drives a car to work. Maybe a foreign crisis will cause a credit crunch, or President Trump will spark a global trade war. A recession might seem like a distant concern, with the latest data showing that the current, extraordinarily economic long expansion just keeps humming along. But one will hit eventually, for some reason or another—that’s how economies work. And when it does, the country won’t be ready…”

  7. Baby Doomer says:

    Two-thirds say this is the lowest point in U.S. history—and it’s keeping a lot of them up at night

    • This is a survey by the American Psychological Association. I can see that people would be stressed by the change of course the country is taking – Democrats more than Republicans, and especially Hispanics. The coarseness of the rhetoric is of concern to a lot of people.

      The more a person watches the media, the more concerned a person gets. (Reading OFW is not really comforting either.)

      • Fast Eddy says:

        I wonder what happens when it becomes clear that Trump cannot Make America Great Again….

        Oh right…. they will elect someone else…. who will Definitely Make America Great Again – Guaranteed or your Money Back.

      • (Reading OFW is not really comforting either.)

        You mean your posts? Or everyone else’s?

        Personally I don’t find anything of comfort here since all hope of any future beyond a certain point has been obliterated and no ray of light is allowed to enter. It is shut down immediately and with such force as to leave one stunned.

        I have never witnessed this kind of environment anywhere else online… and I find it fascinating otherwise I would not tune in.

        Sane people, on the other hand, would not want to spend their time jousting with the likes of FE (bless his cotton socks) or be on the recieving end of all the name calling and other insults.

        Other blogs would have shut that behaviour down and had a more balanced discussion but that’s not what happens not here.

        Here… the “science” has been settled… which of course is not how science works.

        • Except that the science of how an economy works is pretty clear. It is a dissipative structure, with finite lifetime. How precisely that works in this situation is less clear. What does the collapse “look like?” How long can it be held away? Will there be any way that at least a few survivors can go forward?

          Our usually sources of information assume that an economy can continue to grow forever. Someone needs to counter this ridiculousness.

        • try Resilience instead—over there it’s a foodbank for optimists.

          all you have to do is believe—and you can have as much as you want, when you want.

          there are just three items on the menu

          wish politics
          wish economics
          and wish science
          (my terminology)

          If you don’t believe that, read the articles in detail, and judge for yourself. (dont accept my word, whatever you do)

          the key ingredient in their recipes is that humankind should change its inherent genetic behaviour in the course of the next (or this) generation, after evolving through half a million generations driven by homicidal inclination. And we should become peasants wishing each other good day as we go to toil in our veggie plots
          (if you think that’s likely—then Resilience will welcome you)
          If you don’t then come up with the likely alternative.–(Other than asteroid mining please)

          i just offer the situation as it is right now

          i would welcome constructive argument

          • Fast Eddy says:

            It sounds as if you are saying the one known as Fast Eddy would not go over very well on Reliance….

          • I did say…

            Sane people, on the other hand, would not want to spend their time jousting with the likes of FE

            So I must be less than sane.

            My idea that something spwaned by our species can break away and survive for some time is based on the activity I see around me.

            For some time now, much of human activity has been geared towards building the One Machine. It surrounds us, we scavenge for it, it keeps us warm, we feed it with all of the worlds data, it learns, takes baby steps, needs us less and less… until one day it can stand on its own.

            A tree puts out seeds to be blown by the wind. That’s what we see. But the process is contantly changing, constantly evolving and adapting and branching off… until that branch goes extinct.

            So no, I don’t see humans making it much further and certainly not as peasant farmers. I see a very remote chance that some form of intelligence survives as humans fade away. Of course everything would have to hold together long enough for that to happen but 90% of humanity wouldn’t be required for that purpose.

            Call it a flight of fantasy but much of our resources are now shifting to this goal. There is something to it. I wouldn’t dismiss it so easily. But then what does it matter?

            • sane people like the occassional nutcase—it makes them feel saner than they really are

            • Fast Eddy says:

              Flight of fancy… I prefer hopium…

              As in we are being fed the usual techno-hopium that convinces the masses that we shall overcome – we shall overcome — AI, Mars, EVs, Renewable Energy, hyperloops …. and all that jazzzzzz…. the future is presented as so bright we gotta wear shades….

              Come on … take the shades off…. BAU is falling to bits before your eyes…. we are not going to Mars… EVs are a joke … as is renewable energy … this is very obviously all a farce…. we are at death’s door here….

              We shall not overcome…. not a chance in hell of overcoming the end of energy.

        • Fast Eddy says:

          The thing is…. the core on FW used to have hope…. I suspect all once believed that renewable energy and EVs etc… were going to save us….

          But over time … we shone the laser beam of logic at those ideas…. and determined they were not going to save us…. that they did not hold up to scrutiny…

          That is why we are congregated on FW — we are in mourning — because we know — we KNOW – that there is no way out of this — we understand that death is imminent ….

          Let me tell the story of my aunt…. a wonderful jolly woman….

          I last saw her about a year before she died…. she was in great pain … she was 85 years old — she was obese — diseased — and had just had a cancer operation — she was clearly on her last legs….

          I knew I was unlikely to return to Canada before the end game — so I left some cash for flowers with my sister in law …. she thought I was being a big negative … that I lacked hope….

          She was dead within months.

          There is not hope. BAU is diseased…

          BAU is being pumped with obscene amounts of chemo … and pain-numbing drugs … the doctors are fighting to get another year — even another month —out of the beast… so many chemicals are being pumped in now it is the chemicals that may end up killing BAU – before the disease gets her….

          FW is Death Watch (kinda like Bay Watch – but with no hot babes) ….. we are watching the death throes of BAU….. we are fascinated yet appalled— all at the same time …

          Because most of us here understand — that when mother dies…. the children die too — all of them . all of us….

          That is just the way it is…. EVs and solar energy and Elon Musk will change nothing…. they are simply narcotics given to the masses to numb them and make them oblivious to the incredible story that is playing out right in front of their eyes…

          All history that came before this is a single grain of sand all the deserts…. what is about to play out is the end of history … and we get to bear witness.

          We on FW are not numbed by the Hopium …. we know exactly what we are facing …. we deal with this reality in our own ways…. we know the horror that awaits us….

          Some of suppress this with the glibness of a used car salesman…. or by cold hard analysis … or by other means….

          Hope? Yes there is hope – hope that the CBs can buy us another day – another month — a year? How about a year? Yes another year…. that would be comforting…. a whole extra year… wonderful….

          When the power goes off… when the power goes off…. then it will begin….

          • doomphd says:

            my personal fav Brando line from that movie, to Martin Sheen’s character at his arrival up river: “you’re just an errand boy sent here to collect upon a debt”. at some point, all our debts will be collected upon.

          • Have you ever been wrong?

            Do you have a crystal ball?

            Yes, yes all evidence points in a certain direction but you shouldn’t count your chickens or put all your eggs in one basket. Didn’t anyone teach you these things after you were dropped on your head?

            • Fast Eddy says:

              Yes I was wrong — I used to believe in solar panels and EVs and all that crap…. but now I see these things for what they are — palliative measures to calm the masses before the slaughter.

              Which part of these two articles don’t you understand?

              “To provide most of our power through renewables would take hundreds of times the amount of rare earth metals that we are mining today,” according to Thomas Graedel at the Yale School of Forestry & Environmental Studies. So renewable energy resources like windmills and solar PV cannot ever replace fossil fuels, there’s not enough of many essential minerals to scale this technology up.

              Renewable energy ‘simply won’t work’: Top Google engineers

              Two highly qualified Google engineers who have spent years studying and trying to improve renewable energy technology have stated quite bluntly that whatever the future holds, it is not a renewables-powered civilisation: such a thing is impossible.


              I’d be the first person to embrace some new technology that could kick the can another 20 years or more….

              But there is nothing. Zero. Zilch.

              And we are very close to the edge….

    • Fast Eddy says:

      All rather amusing … can anyone point to a single policy that Trump has initiated that they find offensive… unsettling.

      I can’t even think of a single policy that he has initiated…. let alone an offensive one…

      But then I don’t follow politics .. so I don’t know much about his partnership with the devil aka Putin…

      Trump is a superb villain though…. when people are spending most of their time thinking about the villain … they have little time to think about other things…

      Did I mention I received an email out of the blue from a mate who lives in the US — urging me to take action (before it is too late) because Trump has sold out his country to the reds? And he’s not even American!!!!

      • Yorchichan says:

        Perhaps he’ll succeed in ending diversity visas in the wake of the latest terror attack. But don’t hold your breath. I wonder if Trump knew what the job entailed before he became president. Must be so frustrating being the teleprompt reader in chief.

        • Fast Eddy says:

          I am sure he understood his role when he was tapped by the eld er.s….

          They likely said – just be yourself — be like you were on The Apprentice… stir the pot … create controversy … draw attention … ENTERTAIN!

          But always remember — who the boss is… when we tell you appoint Goldman Sachs people to your administration … you say how many …. when we tell you to order the gassing of women and children … you say in which country next….

          Now off you go Don …. have fun!

  8. MG says:

    Although Nigeria is a big producer of oil, it suffers from energy shortages with its very high population. Rosatom agreed to build nuclear power plants there:

    • There’s a british company that is electrifying Rwanda with a pay as you go service… 24 inch tv included!

      • The big question is, how well will this work:

        “The biggest constraint to faster growth is a shortage of finance, since most off-grid firms are putting up the money for new installations, but are only getting paid back by their customers over time.”

        How much money are customers going to have to repay this debt? Televisions don’t help productivity much. Lights at home might help, if the system has batteries to operate at night. In order to be useful, the system needs to add enough economic activity to pay for itself, including the cost of batteries and of maintaining the system. The televisions are imported from elsewhere. The LED lights are imported from elsewhere. The wiring for the system is imported from elsewhere. What are local people supposed to do? Make pottery and sell it on the world market? It is not a system that pays for itself.

        • Most of the buyers are farmers. Instead of paying for other types of fuel they now make monthly installments to have electricity.

          Yes. They use batteries.

          I wish i could find the original BBC article where I saw this story. It explained all of this and had pictures of a family in a mud hut watching their 24″ tv. Others had a computer.

          When asked if the children enjoy the entertainment, one boy says he keeps up with the news. Now he can see who the politicians are and what they say.

          These are tiny incremental improvements in a very long term game of development. When the media talks about leapfrogging of tech happening in Africa and India they mean this… and a very basic mobile phone.

          You have to wonder if any of it matters. It’s almost like egging on the last runner in a marathon who’s limping to the finish line.

          Meanwhile… in the rest of the world… we have hypersonic intercontinental missiles, gene therapy, and 100 MB internet speeds. Well… some people do… I don’t have any of those things.

          I think the most important thing is a basic connection to the internet. You hear stories of african farmers improving their yields because they look up the latest research in american universities. This can be applied to almost every activity… medicine, education, entrepreneurship etc.

          • I am wondering how much benefit these solar panels in Africa will actually give. Certainly, they can charge cell phones, and run televisions, especially if the televisions are connected to batteries to keep them operating when a cloud goes over. They can also pump drinking water and some irrigation water.

            My question is whether these solar powered systems really provide enough benefit in Africa to pay back their cost, plus interest. Will the incomes of the people be enough higher, as a result of this new system, to pay for the system? If more food is produced, thanks to the irrigation, does this simply depress food prices in the area, for example? The system doesn’t really give people enough “power” for industrial processes or for cooking. It doesn’t offer any transportation fuel either. It perhaps allows schools to have more teaching materials, and better lighting. The economy is an integrated system, and solar panels “sort of” fix one part of the system. Is the resulting system really significantly better, or is it simply unbalanced–for example, a lot of better educated young people, who still cannot find any kind of reasonable jobs except subsistence agriculture? And lots of debt, which the system can’t really pay back?

          • nope.avi says:

            “You hear stories of african farmers improving their yields because they look up the latest research in american universities. ” No, I haven’t. I’ve heard of farmers having access to global capital to use industrial farming methods to improve productivity.

            Knowledge is nothing without capital.

            • That is about it. Capital is needed for any kind of an upgrade. And the benefit has to be great enough to pay back the cost of capital, plus interest.

              Probably the biggest thing that can be done with modest investment is to add a new well and irrigation. Ideally, heavy equipment and steel pipes are needed, but quite a bit can be done using shovels, human labor, and a solar powered electric pump. Irrigation does tend to help yields for at least a few years in dry areas. At some point there can be secondary problems from the irrigation, such as salt deposits in the soil. Also, a deeper well may be needed at some point.

              The catch as I alluded to before is that while this is beneficial (in theory) for one farmer, in the aggregate, it tends to drive the price of the food the farmers are raising down. There is currently a worldwide oversupply of cereals. For this reason, it is hard to make money selling this food into the world market. Perhaps raising vegetables for local use would work better.

    • Harry Gibbs says:

      Meanwhile South African cannot afford it:

      “Finance Minister Malusi Gigaba has made it clear that South Africa cannot afford to embark on a costly nuclear build programme right now, although it remains part of the proposed energy mix.

      “Gigaba told a briefing ahead of his mini-budget on Wednesday afternoon that the sluggish economy and lack of demand for energy means that Eskom has a surplus of electricity.

      “In his speech, Gigaba quoted President Jacob Zuma who told Parliament in May that the nuclear build programme would proceed at a pace and scale the country can afford…”

    • I presume that the Russians are assuming that the price of oil will go up. Otherwise, it is hard to imagine that Nigeria will have money to pay for this.

      • How high do you think oil will go this time and when will it crash back down again?

        Wouldn’t that be the nail in the coffin for further oil speculation?

        • I think that coal is just as big a problem as oil. All of the “stuff” from the Peak Oil groups has hidden this issue.

          China has managed to temporarily pump up the coal price (in its part of the world) by closing unprofitable mines. In fact, it plans to close even more mines. China is now the world’s largest importer of coal (besides being the world’s largest importer of oil). The slightly higher prices for oil, plus the considerably higher prices for coal, and the indirect impact these have on mineral prices are sending up China’s inflation rate. With a higher inflation rate, interest rates need to rise. In an economy based on a huge amount of debt, this is a problem. So I think it may be the rising coal prices, in the Eastern part of the world, that may bring the system down, rather than the rising oil prices.

          Coal is awfully difficult to follow, because quality varies greatly, and because delivery costs depend on the price of oil (for transport) and how far the product needs to be moved, and whether this is by land of ship. There seems to be a lot of it, but it is low quality and distant from needed markets. I am fairly sure we are past peak coal; this has occurred because of low prices.

          Your question was regarding how far oil prices will go this time, and whether that would be the nail for future speculation. I think coal, debt levels, and interest rates are all terribly important–as important as oil prices. If oil were the limiting factor, I suppose prices might rise to $85 before they close the system down. I think that length of time at a higher level is important as well. Even $60 per barrel oil may prove to be too high, if left in place for a year or two.

          Oil speculation is based on the belief that the system will always go on. It is very difficult to change this belief.


    Fintech, blockchain and A.I. are revolutionising the banking industry and have the potential to replace a significant percentage of the human capital, eliminating a chunk of their cost bases. Last month, former Citi CEO, Vikram Pandit, was particularly pessimistic, claiming that 30% of jobs could be lost in the next five years.

    Financial professionals are taking online financial technology (fintech) courses to fend off competition and stay ahead of disruption. The boost in uptake is due in part to a feeling among those in the industry that financial technology has reached a turning point in its evolution. A report from Citigroup in 2016 caused widespread debate when it estimated that between 2 million and 6 million jobs would be lost in banking across the U.S. and Europe over the next 10 years. That was attributed to both automation and artificial intelligence (AI), innovation and the rise of more efficient and less cost-intensive challenger banks. Santander’s fintech-focused venture capital fund, Santander InnoVentures, estimates cost savings for banks that implement blockchain technology as high as $20 billion per year by 2022.

    • With manufacturing China picked up the slack… for a while. maufacturing already shifting to other areas or applying further automation.

      With this it spreads across the board… nowhere left to run for white collar professionals. Takes decades of education to produce one and hundreds of thousands of dollars. The ones that are laready trained can’t keep up with changes so they scramble to adapt.

      And who needs financial advisors anymore?

      • Fast Eddy says:

        Just dump cash into an index fund and follow the markets up….

        No funds are beating the market on a long term basis any longer — so I am not sure why anyone has cash in a managed fund….

    • I was talking to a friend who is an accountant. She says that a lot of the quarter-end closing accounting tasks that used to be done by accounting clerks are now being automated.

    • Slow Paul says:

      More people falling down from the middle class rung. More money for the elites.

      • JH Wyoming says:

        Increasingly the higher waged jobs are being eliminated by AI/automation or condensed, i.e. requiring one person to do the work of more but with the help of computer programs. What’s going to be left are very low wage jobs and those who own the companies/shareholders/CEO’s. The effort to alter the tax code is to push that wealth divide even further to solidify one party as the only one representing the elite. It really is a time when people are on notice to try and break into that top echelon one way or another, or face the consequence of having to work long hours, living in poverty with no health care coverage. It’s already moved in the direction a lot and it’s accelerating fast!

  10. Fast Eddy says:

    Watching highlights of Bengals vs Indy NFL …. the entire upper bowl is pretty much empty … the lower half is at best half full…

    Similar story at many of the other games

    Symptom of an economy in deep trouble?

    • Yorchichan says:

      Look at MBL attendances from 2006. Declining , but only marginally:

      If the economy were the major factor, wouldn’t the decline show across all sports?

      I still think fans unhappy with the “take a knee” protest is mostly to blame for the fall in NFL attendance.

      • Yup. It would take a lot more suffering for people to give up their favorite passtime. This is political aftermath.

        That said I can see how comfortable home alternatives to live sports, cinema etc could reduce the numbers too.

        • Fast Eddy says:

          The thing is though… the home options have been available for a long time… HBO Netflix etc…

          So why the sudden crash in cinema numbers? Excuses will be trotted out – lack of quality content… bad weather/good weather etc….

          The elephant is the room is being ignored… flat or declining wages — massive unemployment… less discretionary cash to spend…

          Meanwhile GDP is clipping along at 3% — or so we are told.

          Yet retail restaurants and autos are having big problems…

          Lots of symptoms pointing to a serious disease….

      • Fast Eddy says:

        Baseball stadiums are generally significantly smaller than football stadiums…

        Tickets to baseball games are significantly cheaper….

        Perhaps the fan base for baseball games is significantly different…(more affluent…)

        One thing is for certain …. the NFL has been hugely popular… and I cannot recall ever seeing half empty stadiums in the past …. I very much doubt this has to do with players ‘taking a knee’ …

        ‘The National Football League is the largest live spectator sporting league in the world (excluding auto racing) in terms of average attendance. As of 2015, the NFL averaged 68,400 live spectators per game, and 17,510,312 total for the season’

        • Yorchichan says:

          How about in the UK Premier League (something I know a little bit more about). The average English football fan is very working class.

          Attendances appear to be holding up rather well considering people’s wage rises have been outstripped by (true) inflation for many years. I don’t doubt a breaking point will be reached, but who knows when that will be? Not very long, I expect. Certainly within a decade.

          Personally, I wouldn’t pay to watch somebody with no connection to my local area who earns more in a month than I will in a lifetime (even if both types of football didn’t bore me).

          • Tim Groves says:

            When I used to go to Spurs (Tottenham Hotspur) games with my grandad back in the 1960s, “a foreign player” was someone from Scotland, Wales or Ireland. But once we’d adopted them, they were “our boys” and we’d never have been the greatest football team in world history without them.

            Also, I remember the outrage among working people when it was announced that George Best was going to be paid a hundred pounds a week for kicking a ball around a field on Saturday afternoons. “That’s more than I get in a month even with overtime,” lamented my dad.

    • I bet that the low recent numbers are not affecting published aggregate numbers yet. I am not sure the problem is affecting all of the teams, either.

  11. JGL says:

    Gail, what do you think about food prices? I read this (and articles like it) in summer but have found zero information to follow it up (the wheat shortages in particular).

    I know that Florida’s citrus was badly hit by greening and then the hurricanes. I also read that a great deal of the South’s rice crop was hit by Harvey, as much as a fifth in some areas. In the Northwest we had a very wet and long winter/spring followed by a blazing hot summer, and that affected things like hay harvest. I imagine that a lot of California’s orchards and farms are not faring well following these fires. I have a hard time imagining that food prices will remain unaffected by all of this, unless imports can rise dramatically. What do you think?

  12. Fast Eddy says:

    Gross margin (GM) continue to come under pressure (down 130bps y/y in 3Q), and 4Q forecast implies even worse margin erosion: GM implied down 350-400bps, which would be 4th straight year 4Q GM declined >150bps, would result in 1,000bps of cumulative erosion since 4Q13.

    UAA business continues to come under pressure due to macro headwinds, off-trend product assortment (focus on technical/performance rather than casual/lifestyle), internal operational issues warranting underperform rating.

    ‘Macro head winds’ = the consumer is broke and maxxed out on credit….

  13. J. H. Wyoming says:

    Brent at 61.24

    The fact it went above the 60 dollar threshold and not only held but went above 61 is a sign price is probably going to hold above sixty a barrel. If price goes higher the remainder of this week, it’s a very strong sign the glut is over and now it’s time to find out just how high a ceiling customers can handle. There is a danger though, that in testing how high it can go will initiate a recession. My guess is oil price cannot go higher than $85 a barrel before reduced consumption as a feedback holds price from going higher.

    • I see the price is down a bit today. US production continues to rise is part of the problem, I expect.

      I agree that oil price probably can’t go higher than something like $85 per barrel, before reduced production becomes a feedback.

      • Mark says:

        So the global economy stays alive because of the so called ‘everything bubble’. Pumped in by the CBs.
        Couldn’t that continue for a while (as it has) until some other form of reckoning comes along?

        • Fast Eddy says:

          That is what I am thinking…. CBs might be able to hold this together … and the end game comes as a result of say … a big drop in either conventional oil … let’s say Ghawar production crashes…. or we get a big drop in shale production …

        • I think China has been a major force in pumping up our current (2017) bubble. We never know exactly what China is doing. The stories from China were that there was a lot of pumping up going on, in advance of the convention a week or so ago. If they stop pumping, or the other governments do not do enough to make up for their loss, we are in trouble.

          We can cross our fingers that everyone will pump a great deal more. But we never know for sure what will happen. The Central Bank Governor from China’s central bank warned against a possible future “Minsky Moment,” a couple of weeks ago.

  14. Baby Doomer says:

  15. Baby Doomer says:

    Here is a picture of one of the mining trucks used to gather the minerals needed for the 1200 lb Tesla car battery..It burns threw one gallon of diesel every 30 seconds…

    • greg machala says:

      Well that is interesting. The AI and robot proponents on here would regard earth moving equipment as unecessary in an AI/robot world. I can hear the arguments no: we don’t need earth moving equipment once artificial intelligence and robots take over. As we all know, robots and computers don’t need any energy, resources or minerals to build and maintain. Nor do they need any human help of any kind.

      • Earth moving equipment is necessary… it’s also a tiny fraction of the world’s vehicles and uses a tiny fraction of fuel consumption comapared to lets say…ships.

        They also drive themselves and operate round the clock… a perfect match of AI, automation and resource aquisition.

        The human help gets to be higher paid technicians which is a growing field.

        British mining company Rio Tinto has 73 autonomous behemoths transporting iron ore 24 hours a day in West Angelas, Australia, across four job sites, according to MIT Tech Review. The autonomous fleet is roughly 15% cheaper than one with human drivers.

        The trucks, made by Japanese manufacturer Komatsu, weigh 416 tons and use a mix of GPS, radar, and laser sensors to navigate a site. Their job is simple: go to a load site, wait to be filled with iron ore, and then drive to another location. Komatsu estimates that their autonomous trucks have already hauled 1 billion tons of material, mainly in Australia and Chile.

        The human team overseeing the robots work 750 miles away, according to MIT Tech Review, far from being able to physically take action should something go wrong.

        • This is the wage disparity problem, and the lack of high wages. Our problem today is a “demand” problem, caused by wages that are not rising enough.

          • I think we reached peak consumerism some time ago and it wasn’t a very sensible or sustainable model for our development anyway. Even so, it got us this far and if it were possible then now would be the time for breakaway civilisations to… you know… break away.

            • Slow Paul says:

              Nothing is sustainable you know. As a civilization we are facing problems that are pretty straight forward, predictable and solveable if everybody worked in humanity’s best interests.

              But the single cause of all our issues is the Maximum Power Principle which drives all living beings, the invisible hand… This has no solution, we cannot change our DNA or the very reason DNA exists.

              So live your life today, don’t wait for the future.

            • The problem is the way dissipative structures work, and in particular the way the economy as a dissipative structure works.

              I have heard arguments that Odum’s Maximum Power Principle is close to correct, but not exactly correct, in characterizing what is happening.

          • theblondbeast says:

            I agree this is really the central problem. I haven’t seen anything which approaches a good idea. Steve Keen I think has the best understanding of real wages as a function of multiple factors – demand for labor, change in productivity, and change in population. His solution (last time I checked) was giving money directly to consumers – or a debt jubilee. Reducing population – even if only the relative rate of population change relative to the rate of change of the other two variables, would also seem to help. Neither of these seem politically possible, even if they are theoretically possible.

            Minimum wages don’t seem to help – since this has a feedback loop of increasing prices and reducing the consumption of goods and services produced by labor.

            Something Keen hasn’t considered and I haven’t ever seen considered elsewhere is the feedback of energy prices on the value of labor. Being from a dairy family as a child I think a perfect example is Nate Hagen’s often used slide comparing milking a cow by hand vs. a milk parlour, vs. an automated milking system at different energy prices. But even this doesn’t take into consideration the impact of overproduction of milk on milk prices and the structural shift toward capital intensive agribusiness.

            Seems like a real pickle.

            • Japan has tried issuing government debt, and using it to fund make-work jobs for quite a few people. This keeps the unemployment rate low. But it doesn’t fix the problem of lack of productivity growth. It makes it worse.

              If there weren’t the limit on resources, more population, rather than less, would be a solution, because more people would mean more demand for houses, cars, clothing, etc. If population goes down, a country can just reuse its houses, schools, and roads, cutting back on the need for jobs.

    • Fast Eddy says:

      EVs are green …

    • Well yes but… the mining trucks are mining all minerals for all purposes. To equate that activity with only one use is a little disingenuous to say the least.

      • Fast Eddy says:

        The issue would be that Tesla says it is saving the world … that it is ‘green’

        It is no different than any other vehicle — it is manufactured using massive amounts of fossil fuels … and it runs on fossil fuels…. coal instead of oil of course….

        And burning coal is far more polluting than burning oil … particularly when lignite is involved.

  16. Fast Eddy says:

    Look – more entertainment as the world spins faster and faster!!!

    When Hollywood itself becomes the entertainment….

    Keep the kids away from Alphy’s Soda Pop Club!

    • Third World person says:

      one thing i don’t understand how is this Hollywood child abuse
      any different than sexual abuse in any other fields

      • nope.avi says:

        Usually when normal people witness this sort of thing happen to someone they know, they find solace in outing the perpetrators and putting an end to the injustice or some kind of religion…but no, he says he was lost until someone introduced him to…”animal rights” and some other environmental interest. What puzzled me was how does “animal rights” help him deal with sexual abuse ?

        “how is this Hollywood child abuse
        any different than sexual abuse in any other fields”
        There is a lot more money involved.

      • greg machala says:

        Because they get away with it.

      • Fast Eddy says:

        Very wealthy – very famous – very powerful people… who – as Greg says — get away with it.

        Loads of this going on in Hollywood — this could go on for months — I need to buy a big sack of popping corn next time I am at the bulk bin shop….

      • zenny says:

        Because they Preach how good they are and try to get people to follow them.

  17. JGL says:

    Sorry lol, I have to leave this gem here where it will be appreciated. Happy Halloween everyone:

    This Energy Revolution Could Shrink Your Electric Bill to Zero


    Happy Halloween. Whether you’ll get a trick or a treat is hard to know in this zombified economy.

    Take negative interest rates. When Europe’s central banks pushed rates below zero, large depositors found themselves paying interest instead of receiving it.

    But at the same time, some lucky homeowners found their mortgage payments turn into credits.

    The weirdness continues. Last week, Bloomberg reported that German power producers would likely be paying customers to use electricity this weekend.

    How does this possibly make sense?

    The answer is in the wind.

    Photo: AP

    Blown-Away Prices

    Normally, utility companies calculate how much a kilowatt-hour of electricity will cost to produce and therefore, how much to charge the customers. That’s pretty easy to do with fossil fuels, but wind production—which Germany depends on heavily—can be volatile due to weather conditions. That means utilities must install extra renewable power capacity to meet demand in suboptimal conditions.

    The more power is generated, the cheaper it becomes—so in the occasional great conditions, the ratio goes negative, i.e., there’s so much power generated that instead of making a profit, the utility basically has to pay the customers.

    Much of the developing world (plus Puerto Rico) has the opposite problem: expensive electricity, and often not enough of it. But that’s changing as renewable energy costs drop.

    Unlike fossil fuels, we can tap solar and wind energy without reducing their supply. That means their cost curve looks more like a new technology than a dwindling commodity.

    You’ve heard of Moore’s Law, which says microchip performance doubles every two years. Something similar is happening with renewable energy. Production costs drop as we produce more.

    Two months ago, the US Department of Energy projected the unsubsidized cost of wind energy could drop 50% from current levels by 2030.

    That’s not dreamy environmentalist sentiment either.

    Remember who runs the DOE now: former Texas Governor Rick Perry. He’s one of the oil industry’s best friends—but he saw Texas harvesting wind energy and knows how much it helped our grid.

    Photo: Chris Vreeland via Flickr

    The Revolution Is Here

    Just north of Austin, where I live, is Georgetown, population about 65,000. I drive through there when I go to Dallas. It’s a picturesque town with an old courthouse square.

    Georgetown Mayor Dale Ross is a Trump-supporting, staunch Republican. He decided in 2015 that Georgetown should get all its electricity from renewable sources.

    Ross, who is also a CPA, says the choice was clear when he ran the numbers. He told The Guardian last month:

    “The revolution is here,” he said. “And I’m a good little Republican, a rightwing fiscal conservative, but when it comes to making decisions based on facts, that’s what we do.”

    Prices in the city, Ross said, have declined from 11.4¢ per kilowatt hour in 2008 to 8.5¢ this year. Georgetown sources most of its power from a wind farm 500 miles away in Amarillo and will get solar energy from a farm in west Texas that is expected to be finished next June, meaning the city can attain its 100% renewable goal even when the wind isn’t blowing. This year, Ross said, the tally is about 90%, down from 100% in 2016.

    “How is anybody going to compete with wind and solar?” said Ross, who has ordered an electric-powered BMW scooter from California and plans to fit solar panels at his home and office.

    • This is the artificially low price problem I have been complaining about. Intermittent renewables create electricity rates that are too low for all other producers, driving them out of business. They need subsidies to complete. The way the rates are calculated is absurd–they don’t take into the full cost of production, so wind and solar look much more viable than they are. This is where it is from:

      • Yeah but…

        Two months ago, the US Department of Energy projected the unsubsidized cost of wind energy could drop 50% from current levels by 2030.

        The usual problems are sun goes down on a winters day and the night is as calm as can be… what then… fire up all the reserve nat gas plants… meaning you need two fully functioning systems that cover peak demand all year round instead of just sticking to the more reliable one in the first place.

        • We need the unsubsidized cost of wind and solar to be lower than the cost of natural gas or coal, because wind and solar produce intermittent electricity that replaces fuel, not electricity generation.

          If we want electricity of the type we operate the grid off of, we need a whole system. Perhaps wind and solar, plus lots of batteries, will be part of it, but it won’t be cheap.

        • Fast Eddy says:

          It amazes me when I bring that inconvenient truth up with a Green Grooopie how they just refuse to get it….

          Now this is a really really simple concept — the sun does not shine and the wind does not blow – a lot of the time…. so what do we do about that?

          Don Draper understands that this question throws a wrench into the logic box of most people…

          That is why we see articles regularly hitting the Lies (news) … of promises from Jesus (Elon) that his batteries are the solution …

          Nevermind that they are outrageously expensive …

          And even if governments wanted to subsidize them the amount of energy that needs to be stored would require literally trillions upon trillions of dollars of investment in said batteries….

          The Green Groopies will reject that assertion — and they will respond with ‘we have to try something – stop being so negative’

          Don Draper has every angle covered.

          • Imagine for a moment that renewables never happened… it’s easy if you try… imagine that we still agreed that coal was a bit dirty…. that we should give nat gas a try… what a wonderful world that would be.

            I would prefer thousands of the latest nat gas plants and conversions of coal plants as an intermediary step than the billions wasted on renewables over the years. Imagine if we’d done that ten twenty years ago and where we’d be now. Not a windmill in sight. Just power plants out of sight where they should be.

            And if anyone dared say… but but the CO2… what are we going to do… I would slap them across the chops and say… Do You Want Your Cheap Energy Or Not? Now begone peasant, I have work to do.

            Someone should have made the tough decisions many many years ago. Now… it’s probably too late. We are too far gone. Be are a severely mentally ill species.

            • Fast Eddy says:

              I suspect this has been considered… but found wanting …. because it is very expensive to transport gas….

  18. Jarle B says:

    Meanwhile in Norway: The “Green Gang” is very cross with the coming “Tesla tax”, but in the real world governments need taxes.

  19. Fast Eddy says:


    Google Searches:

    late night comedians ridicule tesla

    late night comedians mock tesla

    comedian mocks tesla

    comedian abuses elon musk

    Results: Nothing. Absolutely nothing.

    Now I find that very strange considering the high profile of this company — and the usual eagerness of these comedians to tear down anyone or anything.

    Particularly in light of the video making the rounds about the monumental flaws in the car.

    It would appear that Tesla is off limits. The el ders have ordered the MSM to stay away

    • Jarle B says:

      “It would appear that Tesla is off limits. The el ders have ordered the MSM to stay away”

      Nah, it just good old political correctness. Dennis Leary et al went out of fashion.

    • Holy yikes! I was reading your comment the other round at first… That late night comedians were actually attacking Elon Musk and Tesla!

      Well that’s a relief. Armageddon has been called off. The pets get to live another day.

    • When a relative wrote a Facebook post saying how wonderful Teslas are, I left a message pointing to some article about it. I also said, “If you do decided to get one, make certain that you lease, rather than buy. Tesla is likely to be bankrupt in a year or so. Resale values will drop greatly, if no one is around to service them.” (Not to mention the charging station problem.)

      • meliorismnow says:

        Tesla’s real chance of bankruptcy is that they succeed at making and selling a lot of Model 3s (say, 400k) which are then plagued with problems because they raced through the design, production, and testing processes. It seems to me they’re betting the company on black to put themselves into the black. It might be necessary to stay in front of their much larger competitors but it still seems reckless. That same reckless attitude paid off for SpaceX though.

        • Fast Eddy says:

          They lose money on every vehicle they sell….

          So what – they can make up the losses by moving more volume?

          • More volume – the costs of manufacturing that volume come down dude.

            • Fast Eddy says:

              Apparently there are exceptions to that rule….

              EVs are one of them…

              As has been pointed out there is a limit to the materials that are required to make these gigantic batteries…

              If EV production increased into the millions of units…. the already ridiculous costs of an EV would sky rocket….

              Increased production will only increase the break even point.

              This is a non-starter.

              And to top it off — coal is the biggest fuel used in the production of electricity and will be – right up to the very end of BAU.


              I will assume you have read the other posts regarding the stratospheric costs of upgrading the grid to be able to handle more than just a small number of EVs?

              Did you notice the article I posted about how many charging stations would be required on a relatively short stretch of highway?

              The entire concept of EVs is completely ridiculous.

              It is not going to happen – because it cannot happen — it is impossible for it to happen — trying to force it to happen with more massive subsidies will only take down BAU….

              Just as we are seeing that forcing ‘renewable’ energy into the grid is threatening the grid itself.

              We’ve been through all of these issues a thousand times. Nothing has changed. Nothing will change

              The math does NOT work. Not even close.

            • Yep. All true. But they said the same about cars 100 years ago… and planes… and metal ships… and telephones… and computers… and satellites… and rockets to the moon!

              The real issue with EVs is the used market. Didn’t Tesla change their battery guarantee policy recently? What is the lifespan of battery packs before they need refurbishing or replacing? Who buys a 80,000 dollar car to replace it within a year or three? So a used buyer gets five years out of the battery and then tries to sell it? Who’s gonna buy a car with a dead battery pack?

              I can buy a very versatile reliable car for less than the price of a Tesla battery pack.

              And then there’s the bargain Chinese EV knock offs that will continue to improve but would end up with the same issues.

              It all depends on where batteries go from here. Battery heaven?

            • The purpose of a Tesla is to show off the latest technology. Who is going to be buying a used one, regardless?

          • greg machala says:

            That is until they run out of cobalt.

        • One article I read claimed that Tesla doesn’t have any bank lined up to provide leasing on the Teslas, because they won’t give a guarantee on what the resale value will be after, say, two years. So Tesla has to figure out all of the financing for the Teslas itself. This is part of what will do them in. I can see that future market value on lease deals would be a problem.

          These are more general articles.

          This line of credit won’t lease very many.

          • Fast Eddy says:


            No more Tesla buyback guarantee as company cuts price of Model X


            Can one still charge a Tesla for free?

            • I see that article is from 2016. I remember reading about the elimination of the buyback guarantee. I had forgotten that they also reduced the prices of both the Model S and Model X about that time.

              I know that a person buying a Model 3 cannot charge a Tesla for free.

              This is another article from about that time. Tesla Aside, Resale Values for Electric Cars Are Still Tanking.

              According to it,

              A three-year-old Leaf—a $30,000 to $40,000 car new—returned from lease gets sold at wholesale auction at $6000 to $7000 or, on average, just 18 percent of its original price. For gasoline vehicles, a three-year residual is typically in the 45- to 65-percent range. “To be under 20 percent is fairly telling,” said Anil Goyal, Black Book’s senior vice-president of operations. “A lot of it has to do with demand.”

              The Tesla guarantee was for 50% of its original value after three years, meaning depreciation would be like ICE cars.

            • Fast Eddy says:

              ‘The asterisk: That car would most likely be a Nissan Leaf, and you’ll only be able to go about 60 miles before needing many hours plugged in—unless you’re fortunate enough to have fast-charging hardware nearby.’

              You really would have to be mesmerized by Koombaya to buy an EV…… oh but of course given these limitations you ONLY use the EV to drive to the organic fair trade coffee shop to show off you green…. for the real world you drive your ICE….

              Don’t forget the scarf…. the look is not complete otherwise….


    • Baby Doomer says:

      Musk is the ultimate con-artist and will be hated by millions of ‘investors’.. Tesla is going to fail. Millions of American idiots bought the massively over-priced stock or ‘pre-ordered’ a car…When REALITY hits….

    • Lastcall says:

      ‘Tefla’ maybe…?

    • the show must go on says:

      I look forward to him being inexplicably replaced by a butch black lesbian in the next season.

  20. Baby Doomer says:

    Overly Optimistic Tesla Bulls Are the Dumbest Thing on Wall Street -The Street

  21. John says:

    Its October 31st and I’m still shaking my head in disbelief that, not only has the stock market not collapsed, it’s still going up! This has to be the biggest fools bubble in the history of the universe. This makes the tulip bulb buyers look smart.

  22. Sven Røgeberg says:

    Professor Dieter Helm’s report on The Cost Of UK Energy was published on 25th October. The core recommendation is to introduce a “universal carbon price”, i.e. a carbon tax, combined with a unified equivalent firm power capacity auction (EFP). Euan Means summarize the report here
    “……13. The energy sector is going through a technological transformator as electricity becomes an increasingly dominant form of energy. Previous structural breaks have come from single technologies, like the coal-fired power station, the gas turbine, and the civil nuclear power stations. This time there are structural breaks which span the whole economy as it digitalises, the transport sector as it electrifies, and the generation, transmission, distribution, supply and the demand for electricity. We are moving towards a decarbonised, digital, smart electric energy world, offering the prospect of ever- lower costs from cleaner energy”.
    Oh, I wish he was right!

    • The story, of course, is that energy prices don’t go up. They go down, as the buying power of consumers goes down. If the level of debt falls off, this makes them go down as well. Putting in a universal carbon price is likely to make the whole situation worse. Consumers ability to buy goods will be even lower. And of course, it won’t really be as universal as planned.

      By the way, I ran across this article today:

      New Onshore Wind Capacity Dries Up (As Subsidies End)
      OCTOBER 30, 2017
      The Renewables Obligation scheme was closed to all new onshore wind generation in May 2016, although certain grace periods were allowed for projects in the pipeline.
      It may still be early days, but the effect seems to be that new onshore capacity coming on stream in the UK has virtually dried up. The author shows a graph of new capacity in the most recent quarter of 2017 being way down.

      • I guess this applies to replacing existing turbines with more powerful upgrades when the time comes.

        There’s floating offshore turbines but I dont really understand how the extra effort and maintenance costs pay off without even addressing the intermittency.

        I still think nat gas plants are the way to go for now.

  23. Baby Doomer says:

    World Bank warns the world could be heading for another financial crisis

    • Except that we live on debt today. The only way we create GDP today is by creating several times as much debt as desired GDP.

      • Baby Doomer says:

        ‘WORSE THAN 2007’: Top banker warns of looming wave of worldwide bankruptcies

        • This was over a year ago, however. I suppose that they could still be looming.

          I can easily believe that China has a whole lot more debt than a lot of people think it has.

      • Volvo740 says:

        Just set the interest rate to 0.0002 and that debt is manageable. If payments become hard, then set it to 0.0000002. Feels better.

      • J. H. Wyoming says:

        Gail, one of my thoughts on all this global debt being created to artificially generate growth is that it has occurred due to the momentum of decades of a financialized economy which has so far provided faith in the system to pay back all those loans to continue to generate growth. Meaning, it’s a one time event, because once the defaults begin to cascade in sufficient losses, the feedback will be we can no longer generate growth via debt creation and faith in the financialized system will be gone. Possibly rather suddenly too.

        That’s going to be a rather sad moment in time, because at that point we’ll know the cheap energy is no longer available to generate growth (past tense) and faith in the monetary system to create debt to generate growth will also be gone (present sense).

        Quite a moment that will be.

        • I think you are right about our faith in the system allowing today’s big run-up in debt. Also, once this faith is gone, the whole system will fail, including our ability to extract energy products.

          The situation becomes a little like a Ponzi Scheme falling over.

          I am afraid that China is hiding a lot more debt than most people believe it has. Once this comes out, it seems like it could be enough to push the system over. Of course, India isn’t doing very well either.

          • theblondbeast says:

            So true – when it seems like debt can be infinite, it seems like we can do anything. Sometimes I think that eventually what debt bubbles collide with are increasing energy prices which are triggered by debt fueled demand striking the ceiling of what’s possible to affordably produce.

            • Fast Eddy says:

              Perhaps debt and the show can go on …. up until the point where we run low on the fuel that makes the world go round….

              I wonder when that point is… the formula surely involves:

              – how much legacy conventional reserves remain (ie money in the bank)
              – how much new oil can be tapped (such as shale) using some but not too much of the money in the bank

        • xabier says:

          Folly,and delusion, – if persisted in for a sufficiently long time with no apparent penalty and many benefits – starts to look like reality..

          It isn’t.

          Our treatment of the Earth mirrors this financial delusion: reality apparently over-come by the application of fertilisers and pesticides instead of debt creation.

          This has made available to all our billions of hungry mouths what in reality – in a sense – isn’t there at all.

          But the hard bed-rock, with all the soil gone, will soon be revealed…..

          • +++++++++++++++++

          • But the computer you’re typing on is real n’est pas?

            The Internet… that’s real too yes?

            The thousands of power plants?

            For now at least?

            We came from pond scum. Our lineage is long and fraught with terrifying pitfalls and bottlenecks. And yet… from so few with so little… here we are.

            That… is undeniable. For here it is.

            Is there magic involved? Looks like it. Plenty being used right now to keep things ticking.

            Imagine for a moment that we’re building the ladder out in front of us even as the lower rungs are decaying… a race against time… an exiting one!

            Just as all appears to be lost and the decaying rungs are biting at our ankles… runnning out of rung building materials…

            We sprout wings!

      • Artleads says:

        One of those super clear concepts that we lay people desperately need.

  24. this is as much a part of the approaching energy/economic crisis as anything else

    infinite healthcare needs infinite money needs infinite energy—can everyone be cared for irrespective of social necessity.

    the above item is an extreme case, but it is symptomatic of universal expectations

    not offering a yes or no to that—just chucking it into the crisis-mix

    • The whole idea that we should treat every illness that we know how to treat is absurd. We cannot afford such a model.

      At one point, there was a model in which every patient life saved was considered some amount, say $2 million, as the benefit of medical care. Even this would give some measure of cost-benefit.

      More realistically, the benefit needs to be measured based on some kind of benefit that distinguishes between (A) Work-life Benefit and (B) Time alive but not working. The work-life benefit would correspond to some sort of loss of wages (or replacement cost of services for homemakers taking care of children). Time alive but not working would have some lower benefit per year. Amount society would be willing to spend on medical care for a particular individual would depend on:

      (Expected number of future years individual would be able to work) X (Expected earnings each year, capped at say $100,000 per year) + (Expected number of future years individual would be alive but not able to work) X (Expected life enjoyment value of say, $15,000 per year)

      With a formula such as this, every person, even someone already 100 years old, would have at least some future life expectancy, and that life would have some value. So it might make sense to fix small, easily fixed problems. But major surgery would be out, and $1 million per day treatments would be out.

      If an infant is in terrible shape, there is no point assuming that the child would ever be able to work. The formula might give a small amount to spend on helping the child. But in general, we should not be trying to “save” terribly small infants who are likely to never truly be sufficiently normal to work.

      Medical malpractice cases are figured out (in some sense) based on value per year of a human life, and years ago I heard someone from EPA talk about their approach to looking at lives saved from changes in emission standards. It used a dollar amount benefit per average life saved methodology, to determine cost/benefit.

      Alternatively, we figure out first how much society is willing to spend on healthcare, and allocate it based on some sort of benefit formula such as the above. People who are near death would get pain relief, but not hugely expensive ways of extending their lives a few days.

      • i agree it’s absurd

        but then we run into the problem of relationship—if the child/husband/wife/mother/father happens to be yours, and medication is available, but unaffordable on the national healthcare budget

        then what?

        then the second problem—if you’re poor and dying for want of healthcare, and someone is rich enough to pay for it—they live and you die.

        then what?

        • I am aware of the relative problem. My mother-in-law wanted brain surgery for my father-in-law when he was 90. So of course the doctors went ahead and did it.

          Later, when my mother-in-law was approaching death, the doctors came out from her room and said, “All organs are shutting down. Should we put her in intensive care?” I said no, but my husband at first thought it might be a good idea.

          Our whole American approach is nuts. It comes close to, “How much can health care providers make from the system?”

          Somehow some sense needs to be injected in the system. Perhaps a single payer system that sets maximums for certain types of treatment and looks for the lowest cost way of doing things. People should not be left with huge deductibles.

          • You mean the EU or UK systems? These are on their last legs. Just keeping up appearances.

            How about incentivising the healthiest possible lifestyle on a budget from an early age. Most health problems can be prevented from occuring at all if approached in this way. The money saved would go to the genetic issues or rare ilnesses that today get little attention.

            The question is how do you insentivise a whole generation in every country to go along with this? I don’t think it’s that difficult to come up with some kind of reward system. That said at least half the people where I live have taken up some kind of regular exercise since their lifestyles changed or became sedentary. All the doctors insist that people need to be phisically active. Speed walking, biking, running, swimming on a regular basis goes a long way to reducing healthcare costs along with a healthy diet and other lifestyle values. Tobacco still one of the biggest reasons for poor health.

            I agree with Norman… if we have services available then we can’t make that decision to deny care. When we don’t have access to those services as, in many undeveloped areas, then it’s not even an option.

            A lot of disabled kids that require life long care are happy that someone gave them the chance to live and can often be a great source of encouragement to others with problems. Not to be dismissed so easily methinks. It’s not all about numbers.

            • zenny says:

              Canada does ok on about half what the US spends.On average better outcome longer life span and better infant mortality. I think if I was in the top 1 percent I would prefer the US system tho.
              Allot of stuff in my area is self serve. My last MRI was on a Sunday and not see a human until I was stripped down and in a gown and about 10 feet from the machine…all touch screen.

            • Fast Eddy says:

              I would recommend that the gov push everyone smoke tobacco – two packs per day.

              Remove all taxes – allow unlimited advertising.

              That should kill off most people by 60.

              Living longer is a bad thing because I would imagine that well over 90% of all medical costs are incurred between the years 60 and death.

              Also – do not offer any treatment for lung cancer.

              The savings would be enormous.

            • 1.1 billion people

              How many people around the world smoke cigarettes? About 1.1 billion people — one in every three adults — are smokers, according to the World Health Organization. China is the world’s largest producer and consumer of cigarettes, with more than 350 million residents reporting being current or former smokers.

              How many people around the world smoke cigarettes? | Quit Smoking …

              Healthcare is already being withheld for smokers in certain countries so they’ll gradually die off.

              For the rest… gene therapy eliminates almost all healthcare problems going forward. The only healthcare service remaining would be accident and emergency and fake boobs.

              Of course… everyone in the future will be sterile from the gentech… and the robot – human ratio will be 1000’s to 1 so you’re dream will be fulfilled whatever happens.

            • Having lots of smokers is a way of reducing pension costs.

            • Fast Eddy says:

              What’s not to like!!!!

          • Fast Eddy says:

            I am all for Death Panels.

            • Today I read in our local paper about a child who is now two years old, and was born without kidneys. The child has been undergoing dialysis 10 hours a day. They boy’s father is a perfect match, but there is some holdup in approving him for an organ donor, because he has some sort of police record.

              What in the world is going on? Why are we trying to save a baby without kidneys? Or a two year old without kidneys? Father is donor now; a few years from now, another donor will be needed, if it is at all like some other organ transplants I have seen. Lots of anti rejection drugs in between, so he will be very susceptible to other diseases. We add him to the gene pool.

            • Or we can take cells and grow the kid some kidneys in the lab with no rejection issues. Or even better grow them in the body using regenerative tech.


              Taking that technology back inside the body, one might even use the differentiated cells to create artificial tubules and nephrons with the help of bioengineered materials – completing the regeneration that the kidney is unable to do on its own.

              Patients might not have to wait too long to see the benefits of this research. Based on animal studies that suggested an indirect role for stem cells in kidney repair, clinical trials aimed at preventing or rolling back kidney damage in cardiac patients have already begun.

            • Fast Eddy says:

              I still prefer the death panels…. why waste all that money on keeping genetic defects alive … when we could use it to build new sports stadiums…

              Or better still … direct the cash towards researching better bomb technology for use in securing more resources for our exclusive use.

              Death to Weaklings. Always

      • A Real Black Person says:

        Death panels have been ruled out, and a market based health system would leave too many people without care.

        The healthcare debates are moral debates.
        To what extent should the strong help the weak?
        Those who want infinite healthcare don’t want to hear about costs, they will frame the mention of cost as selfish or immoral.

        • So what would you do?

        • I think that this problem is related to the way dissipative structures work. We now feel we are entitled for medical care for everything. We cannot roll back our expectations. Even cutting back on a few excesses becomes a problem (fertility treatments, treatment to reduce the appearance of baldness, surgery on people over 85 yeas old, trying to save very tiny babies, treatments that in total cost more than 1million dollars).

          • everybody agrees on that

            problem is—no one would be willing to become the decision maker on the alternative

            until very recent times, seriously handicapped babies were allowed to die quietly, and the ailing elderly were dispatched as a kindness by family doctors, people just accepted it for the best

            now that sort of thing isn’t allowed

            • nope.avi says:

              The new ideology of Progess has the average person expecting all kinds of medical advances to allow them to become somewhat immortal. The average person is not merely being ignorant, they are being fed these expectations by the technocratic elite, by the likes of Steven Hawking, that humans can indeed transcend their mortality.

              I have a co-worker who truly believes medical advances will allow him never to deal with failing organs…and he still thinks nanotechnology will soon revolutionize healthcare…

              just like stem cell research has…

              just like cloning has…

              just like the Human Genome Project has,,,

            • Fast Eddy says:

              I have a friend who references a Noah Harari book about how parts are going to be replaceable ‘within my life time’…

              Not much good when there is no energy … and of course not possible with no energy….

            • FE

              Well in that case you’ll be eating the parts!

            • Fast Eddy says:

              Body parts for sale … body parts for sale…. come get your fresh body parts!!!

              Buy a leg and get an arm for free – body parts for sale!!!


            • Of course there will be mandatory sharing…

      • xabier says:

        There’s a Robert Frost poem about a young farm worker who loses a hand in an accident: everyone is comparatively relived that it leads quickly to his death,as the thought of surviving incapacitated and young struck them as horrible, having once been fit and strong.

        Of course,so much more could be done for such a case now.

        The most tremendous mis-allocation of resources for us is clearly at the very end of natural life.

        If antibiotics start to fail on a wide scale, much of that will stop anyway.

        In which case I hope the medical profession starts to look at helping to end life relatively painlessly rather than leaving people to suffer gangrene and infections, as they did in the past.

        ‘Do nothing which is not kind’ might be the new medical oath.

        • that healthcare will ultimately fail is not in doubt, because it is energy-dependent

          the problem, again, lies in denial

          xxdisease was curable in the past—why cant it be cured now

          you can hear the conspiracy theorists ratchetting up their invective—i believe there’s a crazy woman trying to get elected right now, who offers the certainty that the us government is pumping the atmosphere full of mind altering gases via contrails.—my point being that these idiots get voted for.

          a weird and wacky world indeed

          • nope.avi says:

            “you can hear the conspiracy theorists ratchetting up their invective—i believe there’s a crazy woman trying to get elected right now, who offers the certainty that the us government is pumping the atmosphere full of mind altering gases via contrails.”
            The proper term is Chemtrials.
            The crazy woman is partially correct. The elite are trying to alter the minds of the population, they’re doing it through the media and through certain institutions.
            Quite a bit of our comments deal with their disinformation campaigns on subjects regarding the economy and technology.

            I don’t think the use of drugs is being used on a massive scale to change how people behave. The elite are major consumers of mind altering substances. They are quick to treat any behavioral problem that they or people in their social circle may have with drugs, both the legal and illegal kind.

            • not really au fait with all this mind altering stuff, so i may have missed something,—but if the powers that be are trying to do that, has it not occurred to aforementioned nutlady (and by association the nuts who believe and vote for her) that we all breathe the same air?

              and who are these mysterious elites who seek to alter our collective minds—and to what end

              absorbing assorted media threads as i do, there emerges a line of crazy bias in all of them—you can take your pick of any line of doom gloom and utopian optimism that fits your own inclination, and run with it, nobody as far as i can judge is forcing anyone to accept any dogma, unless you happen to belong to a wacky cult somewhere.—and even that is ultimately a free choice

            • The elite are major consumers of mind altering substances.

              Oh they love monoatomic gold… tasty!


              According to some archaeologists and scientists, this exotic white powder gold is real and was used by certain ruling class of the Egyptians, Sumerians, Babylonians, and secret societies for esoteric rituals, and to increase vitality and longevity. Many researchers of occultism believe that monoatomic gold is still being used for esoteric rituals by secret societies of today.

              But then… the high priests also used to administer mercury for long life…

            • Norman

              Weather warfare is the use of weather modification techniques such as cloud seeding for military purposes. … Under the auspices of the Air Weather Service, the United States’ Operation Popeye used cloud seeding over the Ho Chi Minh trail, increasing rainfall by an estimated thirty percent during 1967 and 1968.
              Weather warfare – Wikipedia

              I’ve seen climate scientists and Bill Gates harp on about controlling the climate through seeding particles in the atmosphere and in the sea.

              On conspiracies and the Hidden Hand…


        • Exactly. There will be time enough for natural processes to unfold if / when resources dwindle. No need to hurry this along preemptively. Some people appear hungry for a spartan approach to selecting the fittest. We’re not there yet.

          A bullet in the head or palliative morphine? Smothering defective babies or lifelong assistance at great expense to the taxpayer?

          Just as antibiotics appear to be beyond their use by date other treatments begin to emerge.

          Maybe the opioid scandal has more to do with a generalised palliative approach to all this than at first meets the eye. It could be the most efficient, economic way to start removing the chaff. People who are not in pain or suffering in some other way will be immune to this kind of “way out” for a while longer but in the end copious amounts of oxy might be just what the doctor ordered.

          Of course we could simply provide healthcare for those who can pay and no one else. for me much of the healthcare system has been a complete and utter failure with poor diagnosis rates being the number one problem. Many people go through 20 or more years with incorrect diagnosis and thousands of dollars spent on unnecessary tests. All of this would be cleared up with the latest data based AI assissted diagnostic approach.

          • According to one book I have partly read, lack of Vitamin K2 in the US food supply is a major contributing factor to the country’s poor health outcomes. Vitamin K2 is found in the cheese and milk of grass eating cows. It is also found in the Japanese fermented soybean food, natto. It is found in smaller quantities in other places, such as organ meat of grass eating animals. In the US, with all of our factory farms, we get very little K2 in our diets.

            K2 is what makes certain that calcium ends up where it belongs–in a person’s bones, and not in a person’s arteries. Lack of K2 also plays a role in dementia, type 2 diabetes, and arthritis. It is available in pill form, as a supplement.

            • Well that would certainly explain a lot of it. Even though we live in dairy country ( I take it Georgia is too ) cows are not fed like they used to be. It’s all artificial feed and supplements. The more we tamper with the natural supply chain the more things go wrong. But productivity goes up… Yay!

            • It is mostly chickens and trees made into pellets for sale in Europe in Georgia. Also pecan trees.

            • Using ethanol leaves lots of remainders, which are fed to animals, including cows. This is not good for the cows or humans.

            • It’s no surprise to me that the medical chemical food industry complex does not adress root problems in the system… it’s not profitable. The medical industry thrives on keeping people sick and on treatment for vey long periods of time. This is why they shun all other historical medical knowlege from other cultures that is mostly preventative.

              When I was researching my own health issues I read that whole sections had been ripped out of medical journals that had to do with digestive tract malfunction because it is at the root of many modern illnesses and would practically shut down the medical industry.

              Poorly digested carbs, proteins and fats result in toxic molecules that cause many of the “diseases” we hear about today. Doctors treat the symptoms and perform surgery instead of addressing the root cause.

              Studies on captive animals show that increasing stress makes the animals consume all manner of toxic substances when made available to manage the stress. They also adopt unusual repetative behaviour – anything to reduce nervous tension.

              Humans go to stressful workplaces for long hours and then rush to bars to get intoxicated with various substances or overeat to calm nerves.

              TV and other screen entertainments sooth the human animal like a comforter sooths an anxious baby.

              We are animals in a cage struggling to understand our condition. The experiment of industrial civilisation has made humanity clinically insane.

          • Fast Eddy says:

            Just finished this

            What a wonderful way to wind things up …. I highly recommend all doomy preppers get a couple of tablets…. to be used when you realize that Fast Eddy was right… that prepping was futile…

            You could drop the tabs as the bad guys pour over the fence…. or perhaps when the first nasty disease strikes… or when the first signs of radiation poisoning manifest themselves….

            Two 60m per family member should do the trick…

            ‘Just one 60 mg tablet could be dangerous if you’ve never taken the drug before, although some OxyContin users can tolerate much higher doses. In fact, a single doses of more than 40 mg OxyContin, or total daily doses greater than 80 mg is too much for someone who’s just started the medicine.’

            • One of my local doctors hung himself last month…

              A man ahead of his time…

              He used to tell me… we’re all a little bit depressed…

              So… I’m not that surprised that he did what he did…

              What confounds me is that someone with access to copious amounts of drugs didn’t choose the other option.

    • theblondbeast says:

      Unfortunately I think we have to add to this problem Karl Denninger’s perspective that even if we switched to a state funded plan now (not saying we should) the decline in the healthcare industry would trigger a depression, given how large a part of the economy it is. I still think his proposal is the best – which begins by enforcing anti-trust litigation against insurance companies.

  25. Harry Gibbs says:

    Interesting – this is a new one on me:

    “The Northern San Joaquin Valley was ground zero in the housing meltdown, which will see its 10-year anniversary by early 2018. Now, a recent policy shift by mortgage giants Fannie Mae and Freddie Mac threatens to unleash a new round of chaos….

    “The Northern San Joaquin Valley was ground zero in the housing meltdown, which will see its 10-year anniversary by early 2018. Now, a recent policy shift by mortgage giants Fannie Mae and Freddie Mac threatens to unleash a new round of chaos… This time around, an unspecified and growing number of loans – all backstopped by the U.S. taxpayer – will be based on algorithms and computer models, with no appraisal of the homes being put up as collateral.”

    • I can think of a lot of things that can go wrong in this model. There are quite a few homes that are now rental. Some have not been well cared for. A home could have major water damage, or have termite or fire damage. A house where the inhabitants have smoked cigarettes for many years is not appealing to other buyers.

  26. J. H. Wyoming says:

    Article about guy documenting quality problems with his Tesla starting on day 1.

    • Lastcall says:

      Weird thing has happened where I live; a new, 4-bay ‘Tesla only’ charging station has been just been built. I drive past this eyesore (it glows at night!) most days and it has never been used. In fact I have seen only one Tesla in this town ever, over a holiday long weekend. How the heck did this happen?
      Are Tesla’s about to rain down upon us?
      Will we have to plan to cook dinner around the charging of Tesla’s ?

      The interesting thing about this charging staton is that it is right outside the local Fire-station; I kid you not!

      • Fast Eddy says:

        I was in Glenorchy a few months ago … this is a tiny town in the middle of nowhere…

        And lo and behold there was a Tesla charging station …

        I’ve never actually seen a Tesla in New Zealand … I suppose that is because there are no subsidies for these MORE on Mobils….

        • If (when) Tesla goes bankrupt, I wonder what will happen to all the Tesla charging stations. Also, all of the maintenance on Teslas. Presumably, some others would step into the void, but how quickly, and at what cost?

          • Presumably charging stations will be for all types of electric vehicles not just Teslas. I don’t understand the exclusivity behind the whole Tesla charging station approach. We don’t have gas stations for each brand of gasoline or diesel vehicle.

            So I presume that once Tesla folds or is superseded by other brands then generic charging stations would be the default type of station much like todays gas stations.

            Remember gas stations didn’t exist on every corner before cars became popular. The same applies here only this time much of the charging will be done at home or at the rental stations where cars await their next “customer.”

            People try to lump all vehicle use together as if everyone is using them in exactly the same way. This is just a convenient way to dismiss changes in usage before any of the changes have actually taken place and before knowing how things will unfold.

            For example… low use suburbanites with electric vehicles would charge their cars overnight and would rarely need a charging station for routine use or could pop along to one at the weekend and charge for half an hour while enjoying a coffee. No big deal.

            Electric city cabs etc would have charging parks where they collectivley charge until they are available for their next trip at all times of day and night.

            People who require long distance driving on a daily or regular basis would continue with gasoline vehicles until it makes sense to make the switch to full EV or hybrid depending on how things go and only if making the switch makes sense.

            In my opinion, batteries would have to improve in several ways (cost, size, weight, power density etc) before making much sense for larger vehicles.

            If the alternatives don’t work out because true costs are not what they promised to be then people will continue with gasoline until it runs dry. End of story.

            • Fast Eddy says:

              No you cannot charge your non-tesla EV on a supercharger. No cars have been built to accept the higher charge rate, and even if they had …


            • Doesn’t supercharging degrade the battery more quickly?

            • Fast Eddy says:

              Actually … there is no story…. there is no point to EVs…. they solve nothing …

              In fact for those who are concerned about ggebweeb…. they should absolutely avoid an EV….

              EVS should be banned – except on the golf course … can’t have a diesel engine throwing off one’s putting game….

              Electric vehicles in Hong Kong could be adding “20 per cent more” carbon to the atmosphere than regular petrol ones over the same distance after factoring in the city’s coal-dominated energy mix and battery manufacture, a new research report found.

              Investment research firm Bernstein also claimed that by subsidising electric vehicle purchases, the government was effectively “harming rather than helping the environment” at the expense of the taxpayer.

              “The policy is to encourage drivers to be green, but they are actually subsidising vehicles that create more emissions of CO2 and particulates from power plants,” said Bernstein senior analyst Neil Beveridge.



              “Whilst the electric vehicles and lithium batteries manufactured by these two companies do indeed help to reduce direct CO2 emissions from vehicles, electricity is needed to power them,” Morgan Stanley wrote. “And with their primary markets still largely weighted towards fossil-fuel power (72% in the U.S. and 75% in China) the CO2 emissions from this electricity generation are still material.”

              In other words, “the carbon emissions generated by the electricity required for electric vehicles are greater than those saved by cutting out direct vehicle emissions.”


            • The EVs do help China increase its use its coal. They perhaps move some of the particulate matter out of the city. But they don’t really reduce CO2.

            • It doesn’t matter about Tesla or their particualr methods for charging. There are many other car companies working on their own methods. I would expect a global standard approach to charging will be met between them leaving Tesla to one side.

              Supercharging vs charging at home etc…


              From a strictly technical point of view, Supercharging is definitely not harmful to the battery. The way Tesla adjusts the charge power and keeps the battery cooled is definitely on the safe side. I have used Superchargers for probably 30-40% of my 76k miles in the last two years and comparing my battery degradation to others it’s not bad at all. It is actually above average. So don’t worry, use Superchargers as much as you want.

              Of course there is the issues that other brought up about using Superchargers for your daily needs. Just for convenience I really prefer to charge at home whenever I can. Supercharging takes up your time. Charging at home takes up none of your time.

            • WoW! 76,000 miles in two years. That is 38,000 per year, or about three times as much as the typical US driver. At least you are getting some use out of the batteries. You must be a salesman to get that many miles on your car.

            • Fast Eddy says:

              EVs make zero sense. On all levels.

              They would not exist without subsidies (see how Hong Kong pulled subsidies and sales of Tesla went to ZERO)

              They are not scaleable — the costs would go through the roof if sales of EVs became more than a blip in global sales due to shortages in the materials that go into making the batteries.

              The only reason they exist is to give the masses hope(ium) that we can wean ourselves off of petroleum.

              Nothing more.

            • FE

              The proportion of electricity production that is coal is shrinking. The smaller it gets the less CO2 and soot emitted if you’re worried about that sort of thing. Can’t have it both ways old chum.

              This in itself is not the reason for switching to EVs. Personal vehicles make up the majority of transportation so gradually or rapidly switching to EVs makes us all less dependent on oil and problems that come with it.

              The more EVs grow the more the tech is refined and perfected until it becomes the dominant choice on its own merits. Cleaner air in cities. Pollution centrally managed at the production sites. More and more coal powered plants will be replaced with nat gas or other alternatives further reducing their relative impacts.

              The problems you’re reaching for with EVs are temporary. Hardly a fair comparison is it considering they’ve only just got going.

              And Gail is worried about consumers not having enough dough to buy billions of EVs. Well… that’s why those consumers will be living light and renting vehicles only when they need them.

              Why do you care anyway? I thought you were a burn baby burn guy all the way to the bottom.

            • I am just as worried about the electricity not being there, when people expect to have it. What good is an EV without electricity?

            • Fast Eddy says:

              ZIS….. is this a subtle plea for help …. have you be captured by the DelusiSTANIS?

              Blink once for yes …. I will send a team to rescue you….

            • Gail

              Sorry… I should have made it clear that the quote is from the forum following the link.

              I do not and will never own a Tesla model S and wouldn’t want anyone here thinking I was that much of a cretin. A little maybe… but not that much.

              Typical users really don’t use their cars that much. Short trips to the local shops etc when they are not parked and idle most of the time.

              That’s why I see some sense to the transportation as a service model especially in and around cities. But people also like to be able to hop in their own vehicle at any moment.

              And there’s the even more important aspect of showing off the latest bling to the neighbours…. Look at ma ride… I got a better ride than y’ all… ma ride cost so much… etc etc etc.

            • Fast Eddy says:

              Feelin hip….check me on man…. I am cool… dig it?


              Hey – isn’t this the guy who made the video slamming Tesla …. funny how the smile so quickly disappeared….


          • Fast Eddy says:

            I very much doubt that anyone would step in … there are far too few of these vehicles on the road to bother with …. far too many problems with the vehicles … the batteries will not last… I would imagine that if there is no warranty support they will be delivered to the junk yard…. and the tax payer will have to pay to sort out the toxins from the batteries…

            This is the price people pay for Koombaya disease.

            Notice in that video how that guy says people buying Teslas are much more forgiving than the general public… what he actually means by that is that they are buying into the green story — they believe they are saving the planet …. so they will put up with an 80k car that runs out of juice takes forever to charge and built to the standard of a … hmmm the standard of…. to no standard I guess…

            Now imagine the standard of the much cheaper car they are now selling….

            This really should be the next Big Short…. but the gov seems to have Elon’s back….


              Take a look at that list…

              The most popular personal cars across the EU are mostly what you call minis – small cheap and cheerful easy to park runarounds. Ford Fiesta, Renault Clio, Volksvagen Golf, Seat Ibiza, Skoda Octavias etc etc etc

              Cheapest to insure, cheapest to run. That’s what EVs are up against. Or any alternative. I don’t see any yet… not any that compete on all levels. None.

              I wish Tesla model S’s were not in the picture. Even model 3’s are luxury compared to the above.

              Too much hot air. It confuses people. They are irrelevant. Like private jets.

              The Nissan Leaf got close but awful design. Next.

          • Slow Paul says:

            Probably some money to be made servicing Teslas and manufacturing 3rd party parts for them. Won’t be cheap for the consumer though since the aftermarket companies probably want to be profitable. Unlike Tesla…

        • Curt Kurschus says:

          I saw two Teslas on display at the local shopping mall earlier (inside). Saw one being driven along a road near where I worked (I was laid off recently).

      • Baby Doomer says:

        What you don’t like cool new tech? …./s

    • This is a new article by the fellow who wrote about the Tesla cobalt problem earlier. The new article is Tesla’s Most Aggressively Marketed Option Is Gross Inefficiency.

      According to his calculation, the cost per mile for a gas combustion engine getting 21 miles per gallon would be 12.9 cents per mile, assuming 12,500 miles per year. The Model S with the standard battery (Model S75D) would cost 17.3 cents per mile. If a person buys the Model S with the $19,500 battery upgrade, and drives 12,500 miles per year, the cost per mile goes up to 30.4 cents per mile, given the outrageous amount Tesla charges for the upgrade in battery capacity.

      • Oh please… a model S is a luxury vehicle, top of the range, first of it kind to become a household name etc etc etc way more power and weight than affordable run arounds.

        Apples to apples please.

        The true issue will be if car manufacturers manage to continue to increase range and economy for gasoline vehicles. Then major breakthroughs in battery tech would be required to compete.

        Governments can still mandate (as they are doing) no further gasoline vehicles should be produced beyond a certain date – espe