The World’s Fragile Economic Condition – Part 2

The world economy can appear to be operating quite well but can be hiding a major problem that causes it to be fragile. My presentation The World’s Fragile Economic Condition (PDF) explains why we should expect financial problems if energy consumption stops growing sufficiently rapidly. In fact, a global sell off in the equity markets, such as we have started to see recently, is one of the kinds of energy-related impacts we would expect.

This is Part 2 of a two-part write up of the presentation. In Part 1 (The World’s Fragile Economic Condition – Part 1), I explained that a large portion of the story that we usually hear about how the world economy operates and the role energy plays is not really correct. I explained that the world economy is a self-organized system that depends upon energy growth to support its own growth. In fact, there seems to be a dose-response. The faster energy consumption grows, the faster the world economy seems to grow. The period with fastest growth occurred between 1940 and 1980. During this period, interest rates were rising and workers saw their wages increase as fast as, or faster than, inflation. After 1980, the rate of growth in energy consumption fell, and the world needed to tackle its growth problems with a different approach, namely growing debt.

In this post, I explain how debt (and its partner, the sale of shares of stock) help pull the economy forward. With these types of financing, investment in new production becomes almost effortless as long as the return on investment stays high enough to repay debt with interest and to repay shareholders adequately. At some point, however, diminishing returns sets in because the most productive investments are made first.

The way diminishing returns plays out in energy extraction is by raising the cost of producing energy products. In order for the sales prices of energy products to rise to match the rising cost of production, rising demand is needed to give an upward “tug” on sales prices. This rising demand is normally produced by adding increasing amounts of debt at ever-lower interest rates. At some point, the debt bubble created in this manner becomes overstretched. We seem to be reaching that point now, especially in vulnerable parts of the world economy.

Slide 34

Let’s first look at a slide from Part 1, explaining the way in which the economy works like a giant factory.

Slide 20

As long as energy products are very inexpensive, it is possible for the economy to expand very rapidly. When this happens, the Goods and Services produced in Box 4 are able to grow so rapidly that all of the Resource Providers in Box 1 can be well compensated, simply by using a quasi-barter arrangement, facilitated by the use of money. With this approach, Resource Providers can get adequately paid using the Goods and Services produced in close to the same time period. Something of this nature occurred prior to 1970, when inflation-adjusted oil prices were less than $20 per barrel (Part 1, Slide 26).

Slide 35

If the growth of the economy slows, so that not enough Goods and Services are being created by the economy to use this approach, it is possible to work around the problem by adding debt. Adding debt makes it possible to substitute promised future Goods and Services for already produced Goods and Services.

Slide 36

Added debt makes it seem like more goods and services are available to pay resource providers.

Selling shares of stock acts very much like debt, because the funds provided by these shares also provide access to goods and services that others have already produced. In the case of the sale of shares of stock, the promises are for future dividends, capital appreciation, and partial ownership of the company.

Slide 37

Growing debt looks like it can solve all problems! No wonder that Keynesian economists found it so useful. But the return must remain high enough to repay debt with interest.

Slide 38

Borrowing money generally comes with the requirement that the amount borrowed be repaid with interest. If the energy purchased using debt allows the economy to grow fast enough, there is no difficulty in repaying debt with interest. If energy is very inexpensive (equivalent to oil cost less than $20 per barrel in inflation-adjusted price), this payback system generally works because a large amount of energy can be purchased for a small quantity of debt.

If the price of the energy rises, much more debt is required for the same amount of energy produced. For example, if oil is $80 per barrel, the affordability is much lower. It takes four times as much debt to pay for a barrel of oil. Repayment of debt with interest becomes more difficult.

Slide 39

In Part 1, we observed that US long-term interest rates have been falling almost continuously since 1981. This situation of falling interest rates led to falling mortgage payments for a given amount borrowed. Because of the lower monthly payments, homes became more affordable; in other words, there tended to be more potential buyers for homes at a given price level. Indirectly, the increased affordability of home ownership tended to raise the resale value of homes. It also encouraged the building of additional homes.

Building homes indirectly requires the use of many different types of commodities. Metals are used in pipes and in wiring. Wood is used for framing. Concrete is often used for the basement. Oil is needed to haul these goods to the site where the home is to be built. Thus, indirectly, falling interest rates tend to raise commodity prices.

Slide 40

Many assets are purchased with debt. If interest rates are very low, purchasing these assets becomes more affordable. The sale of shares of stock provides another way of raising capital for a company. In the case of oil-producing companies, the purchasers of shares of stock often think, “If extraction costs are rising, surely oil prices and other energy prices will rise as well.” This belief allows the price of shares of stock to be bid up to a high level.

Slide 41

When asset prices rise, economists sometimes refer to the wealth effect. Homeowners feel richer if their homes are worth more, and they can borrow more against them. Owners of shares of stock feel richer if their shares of stock have higher values. Owners of pension plans are happy when stock prices are high, because it looks as if these shares can be sold, allowing the plans to meet their pension obligations.

If the debt bubble stops growing, then the commodity price bubble cannot continue to grow. In fact, it may abruptly pop. This is what happened in the second half of 2008, when oil prices dropped precipitously, from $147 per barrel to the low $30s.

Slide 42

Government pension plans such as Social Security are not treated as debt because they are not guaranteed, but they act in much the same way as debt.

Slide 43

The gray bars on Slide 43 indicate recessions. These recessions often seem to be intentionally caused. If a person looks closely, it is possible to see that in most cases, increases in US short-term interest rates preceded recessions. In fact, if a person looks at the minutes of the Federal Reserve Open Market Committee, it is sometimes clear that the Open Market Committee raised interest rates to intentionally pop asset bubbles in order to “reduce volatile food and energy prices.”

Slide 44

The huge interest rate spike to 18% in 1981 on Slide 43 corresponds with the big drop in oil prices on Slide 44. Interest rates were so high that buyers could no longer afford new homes or factories. Prices seem to have been brought down by falling demand.

Slide 45

If we look at recent oil prices, we can also see that they also depend very much on interest rates. In my paper, Oil Supply Limits and the Continuing Financial Crisis, I show that the US debt bubble popped precisely when oil prices hit a peak in July 2008. That is when US consumer credit and mortgage debt started falling.

On Slide 45, QE stands for Quantitative Easing. This was a program that allowed lower long-term interest rates in addition to lower short-term interest rates. Thus, it gave the Federal Reserve (and other central banks) the power to reduce interest rates to an even greater extent than was possible by reducing short-term interest rates alone.

Slide 46

The Federal Reserve seems to have been instrumental in causing the Great Recession, as well. Slide 46 shows a larger scale of the same information about oil prices and short-term interest rates shown on Slide 43. There can be several years between the time interest rates are raised and the resulting recession occurs, so most people miss the role that intentionally raising short-term interest rates plays.

Also, high oil prices also tend to have an adverse impact on the economy because energy prices rise, but wages do not rise at the same time (Part 1, Slide 28). Consumers are forced to cut back on discretionary goods when the cost of necessities (such as the cost of commuting and the cost of food) rise.

In fact, it seems to be the combination of rising energy prices and increased interest rates that leads to recessions.

Slide 47

On this chart, I show some of the comments heard about oil prices. In mid-2008, it was clear that high oil prices were becoming a problem, especially for those with subprime mortgages who were living in homes that were distant from their work. By early 2014, we started hearing that oil prices had been too low for oil producers in 2013. Because of the unprofitability of oil production, some oil producers were cutting back on investment in new production. See my post, Beginning of the End? Oil Companies Cut Back on Spending.

Now, it is fairly clear that no oil price will work for both producers and consumers. Today’s Brent oil price of about $80 per barrel is both too low for producers and too high for some consumers. Consumers who are particularly affected are those whose currencies are falling relative to the dollar, such as consumers in Turkey and Argentina. Even countries with more modest decreases, such as China and India, are cutting back on automobile purchases. This change will affect future oil demand.

If, by some chance, oil prices should spike to a high level such as $100 per barrel, the affordability problem pretty much guarantees that oil prices will fall back fairly quickly. This issue, by itself, makes it impossible to believe that oil prices will increase endlessly.

I should mention, too, that we are also at a point where no interest rate works for everyone. Those buying new homes and new cars need low interest rates, in order for these goods to be affordable. Pension plans, on the other hand, need high interest rates, in order to meet their pension promises. There is no one interest rate that works for every purpose.

Thus, we have a combination problem: no interest rate works for everyone, and no set of energy prices works for everyone.

Slide 48

The Federal Reserve is now in the process of raising short-term interest rates (see Slide 43). It is also selling the QE securities that it previously acquired to reduce long-term interest rates. If buying these QE securities lowered long-term interest rates, selling them should raise long-term interest rates. Raising both short- and long-term interest rates sounds like a formula for creating a huge number of debt defaults and lowering prices of shares of stock. It is likely that these actions will also start a major recession.

Slide 49

Slide 50

On Slide 50, “earlier” refers to Slide 16 in Part 1 of this presentation. From Part 1, we remember that the first small peak refers to the California gold rush; the second larger peak about 1910 refers to “Electrification and Early Farm Mechanization.” The third peak about 1970 refers to the “Postwar Boom.” The last small peak refers to the expansion made possible by China’s growth, and the growth of other Asian countries.

Slide 50 shows that the troughs refer to periods that were bubble collapses, or the collapse of the central government of the Soviet Union. Slide 51 (next) gives details with respect to these low periods. These were bad times for economies: depression, debt collapses, and periods with significant wage disparity. They were not periods with high energy prices.

Slide 51

Clearly, none of these low periods was a good period for the economy. While we can see that there was low energy consumption during the periods, the primary reason for this low energy consumption was the collapse of a debt bubble or of a government.

Slide 52

Peak coal occurred in the United Kingdom in 1913, and World War I began shortly thereafter, in 1914. When peak coal occurred, wages for workers were very low, because diminishing returns had made the operation of coal mines increasingly expensive, but those purchasing coal could not afford higher coal prices. Thus, mining companies could not afford to pay workers adequate wages. World War I gave an alternative employment opportunity for coal miners and others with low wages.

Entering World War I was a very successful strategy for the UK. The fact that the UK was on the winning side allowed the UK to retain its role as the holder of the reserve currency. In this position, it was fairly easy for the UK to borrow the funds needed to obtain coal and other energy imports.

Germany seems to have encountered peak coal about the time World War II began. Was this an attempt to cover up Peak Coal? We don’t know for certain, but the timing certainly looks suspicious.

In both of these cases, low energy supply seems to have led to fighting, rather than high prices.

Slide 53

The collapse of the central government of the Soviet Union seems to have been an indirect impact of the long term low oil prices in the 1981-1991 period. The high oil prices of the 1970s had encouraged the Soviet Union to ramp up oil production. Once the US raised interest rates and oil prices fell, there were no longer funds for investing in new oil production. The Soviet Union was dependent on oil exports. It was able to continue for quite a few years with low prices, but eventually its central government collapsed. Over the long term, consumption has continued to be much lower, reflecting the permanent loss of industry.

Slide 55

Slide 55 is a graph of the “peaks” on Slide 50. If we listen to mainstream economists (including Paul Romer and William Nordhaus, who recently received the Nobel Prize in economics), improved technology can allow the world economy to become increasingly efficient, and thus overcome the problem of diminishing returns. Slide 55 shows that over a period of nearly 200 years, this has never happened in the past. The troughs represent collapses of one kind or another. These low periods did not represent sustainable situations.

The problem is that diminishing returns leads to the need for very different techniques to work around new problems. For example, if there are diminishing returns with respect to extracting fresh water from wells, the first alternative is to dig deeper wells. Efficiency gains can somewhat help offset the cost of deeper wells. But once the problem advances to the point where desalination is needed, plus remineralizing the water with the correct minerals after desalination, the cost of fresh water becomes much higher. It becomes impossible for improved technology to work around the very large increase in costs that diminishing returns seems to cause.

We haven’t been able to work around diminishing returns with increased efficiency before; we are likely kidding ourselves if we think we can do so now.

Slide 56

Slide 57

Slide 58

The point that should be emphasized is that the reason why the United States economy now looks fairly good is because we are at the top of a debt bubble. This bubble is partly the result of world’s long running low interest rates, and partly because of the United States’ recent tax cuts. Thus, the situation today is a lot like 1929 before the debt bubble collapsed, or a lot like 2007 before the economy derailed. Things look good, but they won’t necessarily stay favorable for very long.

Slide 59 Conclusions Continued v2

Slide 59

Separate Additional Conclusions for Various Audiences 

At this writing, I have actually given variations on this talk three different times, to different audiences. The first audience (which is the one I mentioned at the beginning of Part 1) was a meeting of about 100 property-casualty actuaries. These actuaries help determine rates and financial statement amounts for lines of insurance such as automobile, homeowners, and medical malpractice. The specialized conclusions I added for that audience were the following:

Slide 61

Slide 62

The second version of my talk was given at the 2018 Bermuda International Life and Annuity Conference, to a group of 300+ insurance executives of various kinds. This talk was called Energy Economics: Is a Discontinuity Ahead? This audience was especially interested in my talk because interest rates are central to the operation of pension plans. If interest rates do not rise, this is a major concern for this group.

The conclusion slides to that presentation were the following:

Conclusions -Slide 1 of 2 – Life/Pension version

Conclusions for Life and Annuity Providers – Slide 2 of 2

The third version of the presentation I gave was to a group of followers of Peak Oil theory. This presentation was somewhat shorter and slightly rearranged. The title of this presentation was How the Energy System Really Works and What Seems to Be Going Wrong.

Its short conclusions’ sheet mentions the following dangers:

Conclusions of Shorter Version

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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2,110 Responses to The World’s Fragile Economic Condition – Part 2

  1. Fast Eddy says:

    Fast Eddy needs to make sure his delicate fingers do not get broken … so that he can continue to kill DelusiSTANIS on FW…. and how would he do that with broken knuckles?

  2. Chrome Mags says:

    https://www.cnbc.com/2018/11/02/heres-where-the-jobs-are–in-one-chart.html

    “The U.S. economy added 250,000 jobs last month, more than the 190,000 estimated increase from economists polled by Refinitiv, according to the report.”

    I guess Corporations like the greatly reduced taxes, even if they balloon the deficit 17% over 2017. If we could only live on borrowed and printed money forever.

    • Davidin100millionbilliontrillionzillionyears says:

      I’m hoping for enough borrowed and printed money to get BAU through 2019…

      2020 is too far away…

  3. Chrome Mags says:

    https://nypost.com/2018/11/02/passengers-fight-with-bus-driver-sparks-fatal-crash/

    This is worth a short video watch as a Chinese bus driver has a verbal/physical battle with a woman passenger, then turns left and plunges off a bridge to their ultimate demise. It looks like he purposefully turns left, but you be the judge. Maybe the whole world is starting to get crazy.

    • doomphd says:

      i guess that driver showed her a thing ot two. is there a lesson here?

      • Davidin100millionbilliontrillionzillionyears says:

        absolutely on purpose…

        but as far as I can tell, the “whole world” has been “crazy” ever since homo sapiens arrived on the scene…

        I think of the lesson of “don’t bite the hand that feeds you”…

        extrapolated to:

        if you’re riding on the BAU bus, you don’t want it to go off the road…

  4. adonis says:

    Plan B may be a totallitarian socialist system whereby all countries get an equal slice of the pie the pie representing whatever’s left of the energy resources

    • DJ says:

      Why would the stronger countries agree on that? Not to mention corporations and the wealthy.

    • Davidin100millionbilliontrillionzillionyears says:

      Plan A is to keep BAU going by any means possible…

      because TPTB, the Elites, benefit enormously from BAU and are smart enough to know that it would be very risky to do any kind of “reset”…

      so more money printing, more debt, more QE, whatever it takes…

      there is no Plan B…

      too risky, as noted above…

  5. Yoshua says:

    Oh no no no! My Twitter account has been suspended for I violated the rules! At first they just blocked me, but they have terminated me!

  6. Yoshua says:

    And the WTI hit that line of resistance in October, rejected it and started to fall. Will it bounce and try again…or will it collapse from here?

    The S&P 500 broke down in October as well…

    https://pbs.twimg.com/media/Dq5hJSHWoAANvCu?format=jpg

  7. Baby Doomer says:

    Almost 1 in 5 Germans is ‘at risk of poverty’ despite record employment – study

    https://www.rt.com/news/442901-germany-people-risk-poverty/

  8. Baby Doomer says:

    Only 28% of Americans are considered ‘financially healthy’

    https://www.marketwatch.com/story/only-3-in-10-americans-are-considered-financially-healthy-2018-11-01

  9. Harry McGibbs says:

    “U.S. car sales, which dropped 2 percent last year from a record high of 17.55 million in 2016, are expected to fall further in 2018, hurt by rising interest rates and the return of more late-model used cars to dealer lots… Earlier this year, No. 1 U.S. automaker General Motors Co switched to reporting sales quarterly instead of monthly.”

    https://www.nytimes.com/reuters/2018/11/01/business/01reuters-auto-sales.html

  10. Harry McGibbs says:

    “THE GLOBAL DEBT BOOM LOOKS LIKE IT’S ON BORROWED TIME

    “Companies are finding it harder to issue new debt, as the volatility battering global stocks adds to existing concerns in credit markets.

    “Corporate bond prices have declined throughout the year and October’s global market rout triggered massive outflows from credit funds.

    “U.S. investment-grade issuance slipped 34% from September, according to data-provider Dealogic, while high-yield issuance was down 50% from October last year. Even before October’s selloff, American companies had been raising less money. By the end of September, total investment-grade issuance in 2018 was down 12% compared with the first nine months of last year, and high-yield issuance had fallen by almost a third.

    “The value of new investment-grade corporate bonds in Europe was 75% lower in October than in September and down 40% from October 2017. High-yield issuance slumped 82% from a year ago.

    “Investors pulled $3.1 billion from investment-grade corporate-bond funds last week, according to Bank of America Merrill Lynch, bringing outflows over the past two months to a record $25.2 billion. High-yield funds have also seen big withdrawals…

    “Credit markets had …benefited from a decade of monetary stimulus that is now being withdrawn. The European Central Bank is set to end its bond-buying program and the Federal Reserve is raising interest rates and winding down its balance sheet.”

    https://www.wsj.com/articles/companies-raising-less-debt-amid-troubled-year-for-credit-1541073601

    • Harry McGibbs says:

      “The risk of synchronized slowdown in global growth as Europe wobbles, China sputters and stock markets around the world keep crumbling dominated the world economy this week. Adding to the gloomy picture, emerging markets are under pressure and central banks face fresh challenges to their independence…

      “….the tensions between populist politicians and central bankers over their independence continued. In India the government has tried to defuse tensions after threatening to use special powers. In Italy, the governor and the finance minister sparred over the populist government’s spending plans – and even a Bundesbank economist weighed in with a radical plan to halve the country’s debt.

      “In the U.S., Fed Chairman Jerome Powell may find that Wall Street is his best insurance against Trump’s barbs. In Brazil, the election of Jair Bolsonaro has sparked a market rally and his economic top aide promises business-friendly policies and a blunt style matching that of his boss. A new central bank chief could come as early as next week.”

      https://www.bloomberg.com/news/articles/2018-11-02/a-synchronized-slowdown-is-looming-world-economy-this-week

      • Harry McGibbs says:

        “Asian stocks surged Friday on optimism about a potential ceasefire in the trade war between the United States and China… The gains started after US President Donald Trump on Thursday talked up the prospects of a deal on trade with Beijing after speaking with Chinese leader Xi Jinping by phone…

        “Analysts are highly skeptical that China will agree to major changes that would address the US concerns — especially at such short notice… Investors may be letting their hopes get the better of them, according to some market watchers.”

        https://edition.cnn.com/2018/11/02/investing/trade-war-trump-hsi/index.html

      • Synchronized slowdown or debt bubble collapse?

    • It is hard to add more stimulus, when interest rates are already close to zero or below. Raising rates reduces demand for debt.

  11. Fast Eddy says:

    Warming up for the Big Show!

    A call for a violent Halloween night “purge” sparked a crime spree in the suburbs of Paris. Inspired by the dystopian films in which all crime is legal for one night, hundreds of revelers looted and pillaged the French suburbs.

    Police say messages circulating on social media, calling for a “purge” against the authorities, were responsible for the violence, including robberies and assaults on cops. Roving gangs of masked youths attacked one officer with acid and looted several shops, breaking windows and setting trash cans on fire.

    https://www.rt.com/news/442908-purge-riots-halloween-france/

    Mange le bouef!!!

  12. Fast Eddy says:

    Chinese Stocks Are Sending a Scary Signal About the Economy
    Earnings miss from biggest liquor maker spooked investors

    As exporters feel the heat of the trade war, China’s powerful domestic-consumption engine was supposed to provide some protection for investors in the nation’s stocks.

    That’s not working out so well. A narrative that’s captured traders’ attention in recent weeks has been a “consumption downgrade” in the world’s second-biggest economy. With official data already showing retail sales growth slowing, investor alarm increased when China’s biggest liquor maker, Kweichow Moutai Co., reported its weakest profit expansion in almost three years.

    Moutai alone lost 212 billion yuan ($30 billion) in market value over six days last month. And stocks of companies that sell less discretionary items have done even worse. The Shenzhen CSI 300 Consumer Staples Index slid 22 percent in October, its worst month since the 2008 global financial crisis.

    “We haven’t figured out the reason clearly” for the apparent changes in spending habits, Dai said. Among the explanations market players cite:

    Rising property prices and rents that have crimped the ability to pay for other items
    A collapse in so-called peer-to-peer lending platforms that hit some individuals’ finances
    A probable slide in consumer confidence — for which few gauges exist — thanks to negative news on trade relations with the U.S.
    And signs of consumer behavior becoming more sophisticated, with shoppers getting savvier at finding bargains.

    “People haven’t been this pessimistic in over a decade — consumers’ confidence is weak and they dare not spend money,” said Jinghua Lin, an analyst at Capital Securities Corp.

    https://www.bloomberg.com/news/articles/2018-11-01/china-s-stock-market-is-sending-a-scary-signal-about-the-economy?srnd=premium-asia

    • We have quite a few choices for problem countries.

      • Italian debt to GDP ratio is only just behind Greece’s

        And just like Greece did, the Italians have just voted for prosperity.

        • Looking and the number the BIS Statistics Explorer puts out, the top debt to GDP ratios are

          Luxembourg 435.9
          Honk Kong 373.6
          Japan 369.8
          Greece 301.1
          Italy 261.8

          Italy and Greece both look like they have problems because their Debt to GDP ratios are not rising fast enough, in recent years. There are quite a few I didn’t list above Italy.

          • In fact, “Advanced Economies” in the aggregate come in at a ratio of 276.0 Debt to GDP, so Italy isn’t unusually high.

            Some others over 300%:

            France: 301.1
            Portugal: 314.3
            Ireland: 331.7
            Belgium: 336.1
            Netherlands: 343.3

            In some ways, the ones that are worst off are the ones with relatively low ratios. They generally do not have very well developed financial systems internally. If they want to borrow, they often need to use a foreign currency. This is a big source of problems.

            Turkey: 116.8
            Argentina: 80.4
            South Africa: 125.8
            India: 124.9

  13. adonis says:

    A detailed explanation of Plan B which may happen on the 11th of November 2018 https://www.bibliotecapleyades.net/sociopolitica/sociopol_globalbanking408.htm

    • From the article quoted:

      In 1988, the financial magazine ‘The Economist’ published an article titled “Get ready for a world currency by 2018” (Get Ready for the Phoenix) in which it outlined the framework for a global currency system called the “Phoenix” (a hypothetical title), administered by the International Monetary Fund by the year 2018, which would erase all national economic sovereignty and require governments to borrow from the world central banking authority, rather than print, in order to finance their infrastructure programs.

      This would mean total control by the IMF over member nations as they beg and plead for more capital under the global currency umbrella. . . The plan is to introduce a basket currency system as an alternative to the dollar as world reserve, then slowly but surely phase out all sovereign currencies until the basket becomes a currency itself – the ONLY currency.

      Former World Bank Chief Economist Justin Yifu Lin seems to agree with this ideology, arguing that national currencies must be replaced with a supranational currency, and pointing out that no single currency has the strength to stand alone as world reserve.

      • Harry McGibbs says:

        National currencies are a bit of an Achilles’ heel for the system. A difficult plan to implement though.

        Perhaps we should all be applying for jobs at the IMF – sounds rather fun, sitting on high whilst heads of state prostrate themselves before us, pleading for capital.

        Speaking of global currencies, I thought this was interesting – a greed-powered ponzi-currency with global aspirations:

        https://initiativeq.com/

  14. Fast Eddy says:

    https://www.cnbc.com/2018/11/01/tesla-auto-park-upgrade-to-be-ready-in-six-weeks-musk.html

    Waiting to hear of the first person being run down….

  15. Fast Eddy says:

    A Housing Bust Forms in Bubble Markets Sydney & Melbourne

    https://wolfstreet.com/2018/11/01/house-condo-price-sales-decline-bubble-bust-sydney-melbourne-australia/

    Hong Kong, London, Vancouver etc….. all sinking….

  16. Harry McGibbs says:

    The question vexing super-wealthy preppers:

    “How do I maintain authority over my security force after ‘the event’?”

    https://www.rifters.com/crawl/?p=8433&fbclid=IwAR2pBazUkYL6oi8JFoMk092hdZc_dUL2DFpRmNXsHwwLNXV4ILGAjJQnniU

    • Harry McGibbs says:

      Whoops – wrong link, though the above is good, too. This is the correct one:

      https://medium.com/s/futurehuman/survival-of-the-richest-9ef6cddd0cc1

      • short answer—you don’t

      • Fast Eddy says:

        What is amusing is that there is ample evidence of the Grand Hoax…

        And even if this was real — there is nothing that could be done about it.

        So I really don’t understand why people rant on and on about it…

        It’s like standing on a street corner listening to a mad man rant about the coming end of the world … and believing him. More than that…. wanting to believe him.. hoping he is right…. when the facts and logic dictate … that he is wrong.

        e.g.

        KKKLIMATE DATA FAKED

        by John Bates (leading kkklimate scientist)

        In the following sections, I provide the details of how Mr. Karl failed to disclose critical information to NOAA, Science Magazine, and Chairman Smith regarding the datasets used in K15. I have extensive documentation that provides independent verification of the story below. I also provide my suggestions for how we might keep such a flagrant manipulation of scientific integrity guidelines and scientific publication standards from happening in the future. Finally, I provide some links to examples of what well documented CDRs look like that readers might contrast and compare with what Mr. Karl has provided.

        https://judithcurry.com/2017/02/04/c limate-scientists-versus-c limate-data/

        • Volvo740 says:

          Long extension cords and hair dryers were used to melt the ice_ in the arcticccc.

        • Harry McGibbs says:

          Do you know, FE, I had an inkling, just after I posted that erroneous link, that you might not like it. 😀

          AGW seems an odd thing to get your knickers in a twist about, given that our impact on the biosphere is so pervasively destructive in so many ways and that there is nothing to be done about it. I mean, objectively I find the subject fascinating but why does it get your goat, FE?

          • i can never figure out how/why so many thousands of scientists, in hundreds of different disciplines and hundreds of locations would collude on this single issue—just to wind up OFW doomsters? They can’t all do it at the same time just to get govt grants etc—I’d guess most don’t anyway.

            sure—a few swing the other way, but they are a small minority. Opinions must diverge, that’s the way things are

            if i was about to board a plane, and a majority of aircraft engineers told me it had a poor flight survival record, while a minority assured me they’d checked it over and it was ok

            which set of opinions should i take notice of?

            • They assume that BAU will continue forever. This is an underlying assumption of climate models.

            • Fast Eddy says:

              The thing is… there is no consensus… the MSM lies (again)… the MSM ONLY publishes commentary from those who support the lie…. and ignore all else…

              So Norman — you can be forgiven for believing there is consensus…

              The myth of an almost-unanimous c limate-change consensus is pervasive. Last May, the White House tweeted: “Ninety-seven percent of scientists agree: #c limate change is real, man-made and dangerous.” A few days later, Secretary of State John Kerry announced, “Ninety-seven percent of the world’s scientists tell us this is urgent.”

              “Ninety-seven percent of the world’s scientists” say no such thing.

              https://www.nationalreview.com/2015/10/c limate-change-no-its-not-97-percent-consensus-ian-tuttle/

            • Fast Eddy says:

              Case in point … try finding this in the msm

              KKKLIMATE DATA FAKED

              by John Bates (leading kkklimate scientist)

              In the following sections, I provide the details of how Mr. Karl failed to disclose critical information to NOAA, Science Magazine, and Chairman Smith regarding the datasets used in K15. I have extensive documentation that provides independent verification of the story below. I also provide my suggestions for how we might keep such a flagrant manipulation of scientific integrity guidelines and scientific publication standards from happening in the future. Finally, I provide some links to examples of what well documented CDRs look like that readers might contrast and compare with what Mr. Karl has provided.

              https://judithcurry.com/2017/02/04/c limate-scientists-versus-c limate-data/

            • Fast Eddy says:

              See my earlier post on this — there is no consensus… nothing even remotely close.

              Ask yourself this … if all the engineers who told you the plane was not safe were paid to tell you the plane was not safe… how would you feel about that?

              And how about if just as many engineers believed the plane was safe… were locked in a room so you would have no contact with them….

              I cannot find a single MSM source that publishes John Bates accusation and comprehensive analysis demonstrating that his colleagues faked and destroyed data sets… not one.

              Bit strange .. no?

          • Fast Eddy says:

            Because it is fake… same reason why I get irritated by someone telling me EVs are green… when they are charged using coal…

            Same reason I would tell someone to f789 off if they insisted that 1+1=3.

            All DelusiSTANIS who show up on FW — will see the light… or be crushed

    • Baby Doomer says:

      They have floated the idea of electric shock collars for their guards..Not kidding..

      • Fast Eddy says:

        They’ll need shock collars for the people enslaved to repair the solar panels when something goes wrong threatening to prevent the recharging of the shock collars on the guards (assuming they will have a warehouse of spare parts for the solar panel system)….

        It could go very badly for such people if the guards — having been tortured with shocks — are no longer controlled by the shock collars…

        And wouldn’t the guards conspire with the repairman to make sure the charging system fails…. and make a deal to take turns torturing the master…. while drinking his Champagne and eating his caviar?

        People who are extremely wealthy …. are not necessarily brilliant…. they are often where they are because of luck … but more because they are 100% focused on being massively wealthy…. they live eat and breathe money…. no such thing as enough….

        They have their moments of stuuuupidity.

      • xabier says:

        In a way armies do something of the kind with severe punishments for stepping out of line: – and of course the death penalty – but balance it with creating a sense of unit pride.

        Just buzzing the guards and staff isn’t exactly going to foster that……

    • Fast Eddy says:

      That articles is so much rubbish .. on so many levels….

  17. Yoshua says:

    The Messiah of Brazil has promised that not one square inch of the Amazon will be spared from agro business.

    Finally a leader that understands that the plants are consuming co2, the building blocks of life, and kiIIing this planet.

    All we humans are trying to do is to recycle co2 back into the atmosphere to save this planet.

    Burn down those f***ing trees!

    https://m.youtube.com/watch?v=gPxvtYOITvg

  18. Chrome Mags says:

    https://oilprice.com/Latest-Energy-News/World-News/India-Gets-Much-Needed-Iran-Sanction-Waiver-From-US.html

    India & South Korea received sanction waiver to allow those two countries to purchase oil from Iran. That smacks of concern over the price of oil going to high if distributed supply drops too low, otherwise Trump would remain steadfast on the sanctions, that you can be sure of.

  19. Sven Røgeberg says:

    Paul Collier on the future of capitalisme. «The system has derailed because of bad ideas. The problems can be fixed with the right politics».We have heard it all before and he don`t mention energy until late in the discussion, where he talks about his paper «Closing Coal». Still kind of interesting to learn to know in some details the political recommendations from one of todays most influential intellectuals (and in additon some vivid images of the modern history of Britain)
    https://overcast.fm/+Cfx4I6TA
    https://www.economics.ox.ac.uk/materials/papers/13823/paper132.pdf

  20. Baby Doomer says:

    Bye bye Barron

    https://i.redd.it/4v5xq4tubmv11.jpg

    • Baby Doomer says:

      Bikers for Barron won’t like that one bit. 😂😎

    • Greg Machala says:

      But Donald is a US citizen it doesn’t matter that Melania was not at the time. If Barron is
      his child then Barron can be a legal US citizen. What is happening right now is illegal aliens (non-US citizens) are having babies on US soil and these babies (by simply being born on US soil) are declared citizens of the US.

      • Greg Machala says:

        Since Melania married Trump (who is a US citizen) she too can become a legal US citizen. Melania is married to a legal US citizen and also speaks fluent English as well so she is a natural fit to be a US citizen. Marrying a US citizen makes the process of become a legal US citizen much easier see this: https://www.alllaw.com/articles/nolo/us-immigration/how-get-green-card-after-marriage-citizen.html.

        There are right ways and wrong ways to become legal US citizens. IMO speaking no English and having anchor babies isn’t one of them.

      • when the don sets up the 4th Reich, then Barron can claim German citizenship through his g/grandfather and become fuhrer

        • Greg Machala says:

          More aptly the “furor”.

        • Chrome Mags says:

          I think it’s if one or the other parent are citizens then the newborn is, but if both are not citizens (and the kid is born in the US), then it’s not a citizen by Trump’s new idea, if it should come to pass.

          I think Trump will get around to me sooner or later. I came to this country from the UK in 63 with my family, then got citizenship in 85. This is a slippery slope and as time goes on Trump will come up with more reasons to deport people, including maybe me, claiming citizenship after 1980 is illegal or some such arbitrary decree. Then I have to go back to the UK with an American accent and they absolutely despise Americans there, so that does me no good. Then I’m in my 60’s so what stupid job can I get there, in which they are going to hire an American. Possibly some slave labor job where they make sure I have no contact with their customers.

          I also know people from Laos that came here by decree from Nixon, and there is great concern in that community now that they too will be deported. They recently had a community meeting to discuss what they could do if they got deported, because they fled the communists that were killing them by the 10’s of thousands, but I’m sure Trump couldn’t care less what happens to them.

          We’ll see where this is going but hatred is a slippery slope and Trump is taking us there.

          • JesseJames says:

            Chrome, Why don’t you go preach your drivel on some liberal rag

            • Fast Eddy says:

              +++++++

              We might have to call in the dogs to deal with Chrome

              https://youtu.be/j3nGayLpdaA

            • Chrome’s personal thinking might be nonsense—or just humour

              sometimes hard to tell on here—I go for humour personally You can’t shake off Brit irony by taking US citizenship.

              But without exception, every nation that slips into poverty and chaos throws up a fascist dictator–check history on that.

              The USA is supported on a debt economy which in turn is supported on finite oil. And there are no alternatives

              therefore a severe crash seems inevitable. The country seems to be full of gun and god nuts, with a streak of denial and entitlement thrown in, so the jesusfreak leader seems likely. Pence being a case in point.
              Read up on his nutty outlook on life in general

              As with all fascist regimes there will be no shortage of people to do the necessary dirty work. There never is.

              Extreme conditions throw up extremist ideologies–I dont exempt UK from this, Europe is throwing up far right leaders too–in response to difficult economic times. They all make promises they cant keep because it’s an energy problem not a political problem—which is beyond their comprehension.

              What they offer is a stake in a ponzi scheme.
              Nothing else.
              And folks believe it of course

          • jupiviv says:

            There is a problem with immigration though. The west cannot afford to feed millions of refugees from third world countries fleeing from intolerable conditions of existence partially caused by the west.

            But the people who oppose illegal immigration for more dramatic reasons than unsustainability will soon enough oppose the presence of legal immigrants for even more dramatic reasons.

      • Baby Doomer says:

        It would matter if Melania wasn’t a citizen at the time- if he changes the constitution..That was the whole point of the joke..

      • TJ Martin says:

        But …. Melania as stated earlier came to the US illegally therefore making her US citizenship null and void along with making her and DT’s marriage a potential immigration marriage fraud case .

        Regardless though … get the facts straight . DT’s proposed circumvention of the US Constitution on citizenship would negate ALL birth rights to citizenship as long as at least one parent is not a US citizen ( USCIS )

        Oh … and by the way in case this little fact has escaped you . DT’s grandfather immigrated to the US illegally … not once but twice . Once in order to escape conscription into the Prussian military …. and again after we caught him … sent him back to Germany … and then the Germans kicking him out .. with him then changing his name from Drumpf to Trump in order to appear Swedish . Which is to say … Fred was the child of an illegal immigrant therefore DT is the grandchild of an illegal immigrant .

        Truth once again proving to be stranger than fiction . Not to mention a whole lotta irony going on when it comes to DT’s stance on immigration

      • Baby Doomer says:

        Where is the love Greg?

    • TJ Martin says:

      An even more fun fact straight from the USCIS files . Melania came to the US under a student visa ( which does not permit employment ) yet began modeling professionally within ten days of her arrival … making Melania for all practical purposes an illegal immigrant . Which she would have been and be if it hadn’t;t been for DT’s money , influence and intervention

      • Fast Eddy says:

        She must have been hot when she was young…. there is an exemption in the immigration code that allows for hot young women to immediately obtain citizenship.

        FYI….

        • TJ Martin says:

          I’ll give you the benefit of the doubt for the moment and assume you’re trying in vain to be sarcastic and / or appear clever .. FYI sarcasm does not translate to internet forums especially during these insane , fake news , alt facts , troll infested times

          • Slow Paul says:

            FYI there is a lot of sarcasm in this comment section, whether you like it or not.

          • Fast Eddy says:

            If I am being sarcastic I will end with (sarc)…. otherwise assume I am serious….

            Stick around for awhile…. Fast Eddy’s hobby – when not on FW — is running through china shops with a red cape … with a bull chasing him around….

  21. Harry McGibbs says:

    “October was a rough ride for U.S. stocks, which despite regaining a portion of the month’s losses Wednesday ended as one of the worst months since the financial crisis.

    “The S&P 500 lost $1.91 trillion in October, according to S&P Dow Jones Indices analyst Howard Silverblatt. Losses were spread widely across industry sectors. October was the worst month for the S&P 500 since September 2011.”

    https://www.cnbc.com/2018/10/31/the-stock-market-lost-more-than-2-trillion-in-october.html

  22. Harry McGibbs says:

    “A short-term indicator of gross fixed-capital formation in the [EU] region, developed by Natixis economist Dirk Schumacher, shows a “clear loss of momentum.”

    “This comes as the overall expansion slowed to 0.2 percent in the third quarter, with sluggish consumer confidence suggesting a rebound may not be on the cards.”

    https://www.bloomberg.com/news/articles/2018-10-31/investment-slowdown-may-be-euro-area-s-next-economic-headache

  23. Harry McGibbs says:

    “Australian housing prices have continued to slide, with the market facing its sharpest annual decline in six-and-a-half years…

    “Sydney and Melbourne were, once again, the weakest housing markets — their values falling by 7.4 and 4.7 per cent respectively in the last year.”

    https://www.abc.net.au/news/2018-11-01/property-values-drop-3.5pc-sharpest-decline/10454166?section=business

  24. Harry McGibbs says:

    “The economic impact of the intensifying trade war between Washington and Beijing appeared to deepen last month with factory activity and export orders weakening across Asia, but analysts warned the worst was yet to come.

    “In a sign conditions for exporters and factories were deteriorating, manufacturing surveys showed marginal growth in China, a slowdown in South Korea and Indonesia and a contraction in activity in Malaysia and Taiwan.

    “Those figures follow weaker-than-expected industrial production data from Japan and South Korea on Wednesday, with output in the latter shrinking the most in over 1-1/2 years.

    “Worryingly, the prospects for higher U.S. rates could feed back more market pain for the region’s externally vulnerable economies — Indonesia, India and the Philippines, which have already been forced to raise rates to mitigate a sell-off in currencies, stocks and bonds.

    ““You have a tightening of monetary conditions around the world, a slowdown in Chinese demand, and financial market turmoil that affects sentiment and investment decisions,” said Aidan Yao, senior Asia EM economist at AXA Investment Managers.

    “Yao said many orders from abroad are still frontloaded in anticipation of yet more tariffs and the impact is still mostly indirect, through the business confidence channel.

    ““The real economic shock is yet to come,” he said…”

    https://www.reuters.com/article/global-economy/global-economy-trade-war-impact-deepens-across-asia-but-real-economic-shock-yet-to-hit-idUSL3N1XC2LW

  25. Volvo740 says:

    OFW should be every person’s first stop for accurate data on globalll waaarmung. Great stuff here.

    • jupiviv says:

      Yes, and reposted 5-6 times/day everyday just to hammer it home.

    • Ohadi Nacnud says:

      Here’s how to make FE believe in the worldwide scorch torchy.

      1] Kidnap him.

      2] Take him for a helicopter ride.

      3] Drop him from said vehicle down an active volcano.

      Then he will believe. Sadly, he won’t live to tell the tale. Wicked, because *I* don’t believe anyway. 😉 But hey, we could get crowd funding to do it. It’d be great fun and the video would go viral.

      • If humans are not here to experience it, what difference does it make? In fact, if mammals are not here to experience it, what difference does it make? Are we the protectors of other species?

        • Fast Eddy says:

          Of course this g w thing does distract the herd from the reality that we are about to go extinct….

      • Fast Eddy says:

        KKKLIMATE DATA FAKED

        by John Bates (leading kkklimate scientist)

        In the following sections, I provide the details of how Mr. Karl failed to disclose critical information to NOAA, Science Magazine, and Chairman Smith regarding the datasets used in K15. I have extensive documentation that provides independent verification of the story below. I also provide my suggestions for how we might keep such a flagrant manipulation of scientific integrity guidelines and scientific publication standards from happening in the future. Finally, I provide some links to examples of what well documented CDRs look like that readers might contrast and compare with what Mr. Karl has provided.

        https://judithcurry.com/2017/02/04/c limate-scientists-versus-c limate-data/

    • Duncan Idaho says:

      “Overall we are on the ropes and taking repeated blows to the body and head. To me hot house runaway is now certain, it’s just a question of how fast it happens. Removing C O 2 at any scale is really a pipe dream.”

      • Ohadi Nacnud says:

        I’ve never had a pipe dream. It would be worth experiencing.

      • Fast Eddy says:

        But it is not runawaying… it is not getting warmer at all…

        KKKLIMATE DATA FAKED

        by John Bates (leading kkklimate scientist)

        In the following sections, I provide the details of how Mr. Karl failed to disclose critical information to NOAA, Science Magazine, and Chairman Smith regarding the datasets used in K15. I have extensive documentation that provides independent verification of the story below. I also provide my suggestions for how we might keep such a flagrant manipulation of scientific integrity guidelines and scientific publication standards from happening in the future. Finally, I provide some links to examples of what well documented CDRs look like that readers might contrast and compare with what Mr. Karl has provided.

        https://judithcurry.com/2017/02/04/c limate-scientists-versus-c limate-data/

  26. Jason says:

    Happy halloween. The night for a little trolling.

  27. Fast Eddy says:

    Historical records

    Venice: tourists on the gangways queueing to enter the San Marco basilica.
    Early records
    The first record of a large flood in the Venetian lagoon dates back to the so-called Rotta della Cucca, reported by Paul the Deacon[12] as having occurred on October 17, 589. According to Paul, all rivers with mouths in the northern Adriatic, from the Tagliamento to the Po, overflowed at the same time, completely modifying the hydro-geologic equilibrium of the lagoon.

    Middle Ages
    The first documented description[13] of acqua alta in Venice concerns the year 782 and is followed by other documented events in 840, 885, and 1102.

    In 1110 the water, following a violent sea storm (or, possibly, a seaquake and its subsequent tsunami), completely destroyed Metamauco (ancient name for Malamocco), Venice’s political centre before the Doge’s residence was moved to Rialto.

    Local chroniclers report that in 1240 “the water (that) flooded the streets (was) higher than a man”.[13] Other events are recorded to have occurred in 1268, 1280, 1282, and on December 20, 1283, which was probably an abnormally significant event, since a chronicle reported that Venice was “saved by a miracle”.[13]

    Chroniclers report that high tides occurred in 1286, 1297, and 1314; on February 15, 1340; on February 25, 1341; on January 18, 1386; and on May 31 and August 10, 1410.

    In the 15th century, high tides were recorded in 1419 and 1423, on May 11, 1428, and on October 10, 1430, as well as in 1444 and 1445. On November 10, 1442, the water is reported to have risen “four feet above the usual”.[13]

    https://en.wikipedia.org/wiki/Acqua_alta#Historical_records

    Try a search – Venice floods c ___ ch_____ or g____ w_____ing.

    I guarantee you there will no info on historical flooding… and the current flood will be blamed on g w.

    In spite of this … and the faked data…. there will be those on FW … who continue to believe in this bull sh it….

    stu pid
    adjective
    1.
    having or showing a great lack of intelligence or common sense.

    mo ron
    nounINFORMAL
    a stu pid person.

  28. Chrome Mags says:

    https://peakoil.com/enviroment/japan-announces-new-plan-to-drain-radioactive-fukushima-water-directly-into-the-pacific-ocean

    ‘Japan announces plan to drain radioactive Fukushima water directly into the Pacific Ocean’

    “Reports indicate that approximately 1.09 million tons of contaminated water currently being stored inside 900 tanks at Fukushima will soon be drained in the Pacific in order to make more space for new water, a move that’s sparking outrage among local residents and a number of environmental organizations that worry about what the vast contamination will do to the world’s largest body of water.”

    “Keep in mind that iodine 129 is known to cause thyroid cancer, and has a half life of 15.7 million years – meaning it’s not going anywhere once released into the environment. Ruthenium 106 is similarly carcinogenic and high-risk when its comes to its environmental pervasiveness.”

    “What this all suggests, of course – and affirming what we’ve been saying all along – is that TEPCO has for years been lying about the true level of radioactive contamination at the Fukushima site. There’s also no telling to what degree harmful radiation has already been dumped into the Pacific Ocean, only to spread far and wide across the globe.”

    Won’t this cause every part of the coastline of Japan to become highly radioactive, far beyond what it already is? There are so many conflicting news reports on the radioactivity released into the Pacific so far. There are numerous YouTube videos claiming Fukushima and it’s radioactive releases already represent an extinction event, but then there are news reports on Google searches saying it’s much about nothing. That the radioactive water is dissipating into such a huge body of water, the Pacific, that its negligable. As a result of these conflicting reports, I for one am confused as to whether this latest news report means much of anything or means something very dire.

    • Fast Eddy says:

      They have been pouring tonnes of water each day onto the reactor cores for years now … obviously that water has been going somewhere…. i.e. the ocean….

      • Rodster says:

        Bingo !

        At this point they might as well strap rockets to those reactors and just launch them in the ocean. Just get it over with and while the f789ing idi ots are at it, why not build a few more Nuclear Power Planted. Let’s just give the entire planet a nice green glow.

    • Volvo740 says:

      Maybe they could load the water into tankers and dump it outside LA? Those reactors were US designs after all.

  29. Fast Eddy says:

    Jaguar Land Rover workers face job cut fears after £90m loss
    Carmaker has £2.5bn plan to reduce costs as sales fall in China and Europe

    https://www.theguardian.com/business/2018/oct/31/jaguar-land-rover-to-cut-costs-after-quarterly-loss-of-90m

    Too much of this … and you get the dreaded Deflationary Death Spiral

      • xabier says:

        It’s when financial pressures and sharply falling sales tip into mass and permanent unemployment of previously decently-paid workers that the political fuse will light up, too.

        Until now, the measures put in to place in 2008 have averted high unemployment in the core economies, more or less – above all among the skilled and professional workers who drive so much consumption, keep the asset bubbles inflated, etc.

    • Davidin100millionbilliontrillionzillionyears says:

      JLR could reduce costs greatly if they eliminated all of their workers…

      it may not be their plan, but it might be what happens down the road a ways…

  30. Fast Eddy says:

    What would happen if… one were to start a private school … that taught logic… that taught a range of perspectives on historical events… that taught the the MSM is a massive lie machine… that taught that we are living in a matrix … that taught about Cognitive Dissonance and how it is applied… that taught that the foundation of our prosperous comfortable world is cheap energy and resources… that taught that recycling and renewable energy and EVs are nonsense…. that taught that we must grow or collapse… that taught that we must pillage others because there is not enough for all to live large… and that taught that G W is a ho ax….

    And so on….

    I would imagine one consequence would be to create dysfunctional…. cynical… adults.

    • Jason says:

      You would be shut down for not teaching the government standards.

    • doomphd says:

      you teach them to be critical thinkers, to question everything. the rest they can figure out themselves.

      • Fast Eddy says:

        99.99999999% never figure it out though….

        • Jason says:

          I was a natural born critical thinker. Teachers thought I was a smartass

          • Fast Eddy says:

            What’s your take on Gerbit Worming… EVs…. Renewable Energy …. Doomsday Prepping… and the MSM?

            I liked to think I was a critical thinker …. but I went 4+ decades living in DelusiSTAN.

            Most people who read the New York Times …. I am certain would identify themselves as critical thinkers.

            • Jason says:

              ok, not sure how Gerbit Worming will work out, I think we pushed a fairly stable system to an unstable state, and chaos will push it to another stable state, where? I don’t know.
              Ev, techno hopium, numbers don’t add up. Same with renewable, we have waaaay to many f……ing humans. Prepping, might as well enjoy them while you got them, or if you want to plan to survive once the s.h.t.f. make friends with your neighbors, especially the ones with the guns. MSM, once Trump was so blatantly criticized and Hillary was promoted female version of sectarian Jesus, they lost me. Ever learn what good food really taste like, then go back to your old friends and relatives and see them get excited about Applebees? or New Zealand equivalent. You have to just smile and wave boys, thats my entire existence at this point.

            • Jason says:

              After 4+ decades you figured it out. Not so easy to do. A certain mindset that questions everything, even their own thoughts and beliefs. It is a tough way to live and I commend you.

            • doomphd says:

              we know things here on this blog that most others cannot fathom. cognitive dissonance does not let it penetrate.

            • Fast Eddy says:

              ++++++++++++

              I have never met anyone who gave even a hint that they get it…

              In fact outside of The Core …. there are many on FW who don’t

    • jupiviv says:

      “What would happen if… one were to start a private school … that taught logic… that taught a range of perspectives on historical events… that taught the the MSM is a massive lie machine… that taught that we are living in a matrix … that taught about Cognitive Dissonance and how it is applied”

      Well, if your version of those things were taught the students would be incapable of actual reasoning, discernment and regard for context. “Logic” for them would be a combination of scatterbrained paranoia, bitterness and seeing daemons instead of angels in every dark corner (=critical thinking).

      I also imagine excellence among them would be defined as how decisively they can reject what they’re taught, which means all/most of them would grow up to be obnoxious techno-disney-topians disgusted with the mainstream farce of finite resources and unsustainable BAU. A few lucky ones might even establish their own profitable cults.

  31. Kurt says:

    Get after it FE.

    Startling new research suggests even faster rate of global warming – The Washington Post

  32. Fast Eddy says:

    Wowee! It was a cold one last night …. those god damn sun of a bi tch fans were on full power keeping the buds on the grape vines from freezing… hell of a noice….

    And… I notice the mountain got some kinda white stuff on it overnight… now it cannot be snow … seeing as it is just about summer down here…. and the gobyl werming would not allow such a thing…

    What could that white stuff be?

    If this keeps up I’ll have to buy another trailer load of coal…. I love coal… but I could get a LOT of good wine instead…

    • Wage disparity has been an issue with failing empires for a long time.

      • Artleads says:

        You have mentioned wage disparity quite often. I’d like to bring up the subject in relation to gentrification. It pushes out an inefficient productive sector in favor of a high earning financial sector. That would seem to increase wage disparity, since the old low wage people now have no wage at all and have to be dependent.

  33. Ed says:

    Woo is paying for the group of central Americans heading for the US border? What do they hope to gain?

  34. Baby Doomer says:

    Debt terror: 75M Americans say their finances are a ‘horror show’

    https://finance.yahoo.com/news/debt-terror-75m-americans-finances-135519107.html?ncid=twitter_yfsocialtw_l1gbd0noiom

  35. Baby Doomer says:

    Trump’s Iran squeeze threatens $150 oil and a world recession

    The slowing world economy is not strong enough to handle an oil supply shock.

    At this juncture it would trigger a full-blown slump. Yet that is exactly what we risk as Donald Trump tries to drive every last barrel of Iranian crude oil off the global market.

    A spike in Brent oil to $120 by early next year would probably be enough to tip the eurozone and Japan into recession, and would be the coup de grace for large parts of the emerging market nexus.

    It would amplify the effects of monetary tightening by the US Federal Reserve and the European Central Bank already in the pipeline, and which will hit with full force in the first quarter of 2019.

    The likelihood of such an oil spike has risen from implausible to near 50:50 as it becomes clear that the Trump administration really does intend to knock out 2m barrels a day (b/d) of Iranian exports by early next year. Those barrels are the difference between ample world supply and an almighty crunch.

    Mr Trump is likely to get his way. The evidence so far is that not even China National Petroleum Corporation and Sinopec dare defy Washington. China’s giant refiners have notified Tehran that they will stop buying Iranian exports after the sanctions deadline passes on Sunday. So has India’s Reliance.

    The Europeans are pulling out, whatever the bluster from Berlin, Brussels, and Paris. Total has suspended all Iranian operations. ENI is winding down purchases.

    The US will pay a strategic price for Donald Trump’s promiscuous misuse of financial hegemony. But right now no serious company can risk being shut out of the US capital markets and the dollarised world payments system. It is too dangerous.

    In practical terms, the spare capacity of global oil producers will fall below 1pc by early next year for the first time in the history of the post-war energy markets. This is lower than during the OPEC shock of 1979, and lower than in July 2008 when roaring Chinese demand pushed Brent to $147 a barrel.

    “All this works perfectly so long as there are no supply problems anywhere. But Libya and Nigeria are political wild cards, and Venezuela is collapsing,” said Helima Croft from RBC Capital Markets.

    “You have already had three Saudi tankers attacked in the Red Sea by (Iranian-backed) Houthis and one was sunk. You can’t rule anything out,” said Mrs Croft, a former Mid-East analyst for the US Central Intelligence Agency.

    On Sunday, Iran’s leader Hassan Rohani threatened to close the Strait of Hormuz, the choke point for a fifth of world’s crude and for Britain’s shipments of liquefied natural gas from Qatar.

    Mr Trump tweeted back in capital letters: “Never, ever, threaten the United States again or you will suffer consequences the likes of which few throughout history have ever suffered before”. The Iranians replied laconically that they had been around for millenia and seen empires come and go, including “more civilized” ones.

    Jean-Louis Le Mee and Will Smith from Westbeck Energy said Saudi Arabia, OPEC, and Russia cannot lift output much further to plug the Iranian deficit even if they bend every sinew. “Global crude spare capacity is exhausted. Every producer globally is currently squeezing every last barrel,” they said.

    Westbeck is betting on a “furious rally” in November and December, culminating in a $150 crescendo next year.

    Saudi oil minister Khalid al-Falih confirmed that the OPEC-Russia cartel is in “produce as much as you can mode” and that crude prices could quickly jump to $100.

    “Nobody has a clue what Iranian exports will be. There are potential declines in Libya, Nigeria, Mexico and Venezuela. Our spare capacities for the entire globe are much less today than they were in the past, and we are using a significant part of them,” he told Tass.

    Mr al-Falih says the Kingdom can ramp up output from 10.7m to 12m b/d if need be. “This I can assure. But if 3m b/d disappears, we cannot cover this volume,” he said. Thereafter, Saudi Arabia would have to invest $20bn to $30bn of investment to add another 1m b/d of capacity.

    Few oil watchers believe the Saudis can in fact rech 12m b/d in any meaningful time horizon. S&P Global Platts said the Saudis are already running flat out.

    The Manifa field is suffering from corrosion that will hold back 300,000 barrels a day (b/d) until early next year. While there is a 500,000 b/d field waiting in the Saudi-Kuwait ‘neutral zone’, this is caught up in a dispute over Kuwait’s diplomatic tilt towards Turkey.

    What seems clear is that Washington will take a draconian line on exemptions for buyers of Iranian crude, with limited waivers and phase-out periods even for allies. “Our goal remains getting countries importing oil from Iran to zero as quickly as possible,” said Brian Hook, head of the State Department’s Iran action group.

    Total compliance is impossible but a loss of 1.7m b/d by January is on the cards. S&P Global estimates exports will be down by 1.3m b/d as soon as next month.

    Risks have been obscured over recent weeks by market noise and a jump in Iranian shipments before the deadline. Brent has been caught in the undertow of the October equity rout, dropping 13pc to $76. Hedge funds have been liquidating “long” positions on the derivatives markets, accelerating the sell-off.

    Oil balance is always a complex calculus of shifting supply and demand. Economic slowdowns can deflate prices fast. “The oil market is adequately supplied for now,” said the International Energy Agency in its latest monthly report. This could remain the case for months as new barrels from Brazil, Kazakhstan, Iraq, and elsewhere match vanishing Iranian crude.

    Yet the IEA says that most of the 2.6m b/d rise in output over the last year is due to OPEC and Russia eating into spare capacity. This is “straining parts of the system to the limit”. The agency says fresh supply of 5.7m b/d is needed each year just to keep up with the natural decline of old wells.

    Oil cycles have the power and predictability of tidal flows. Investment in upstream oil and gas peaked at $750bn in 2014 before the price crash. It touched bottom at $460bn in 2016 and has yet to recover. This has stored up trouble.

    Consultants Goehring & Rozencwajg say there has been a collapse in the discovery of new conventional fields. Some 100 projects covering 27bn barrels of reserves have been suspended since 2014. “We believe the big declines in non-OPEC conventional production are about to reemerge as a huge, unexpected issue,” they said.

    Mr Trump appears convinced that America can withstand any shock now that shale fracking has restored US energy independence and turned the country into the world’s top crude producer. This is strangely jejune. Oil is a fungible commodity. The blowback from the interlinked global economy would send the US crashing into recession along with everybody else.

    The energy intensity of the world economy has halved since the OPEC crises of the 1970s. Yet oil can still cause havoc. The spike of July 2008 was a deflationary shock of the first order. It drained demand from the US, European, and East Asian economies, and triggered the collapse of an over-leveraged financial system that had become dangerously unstable.

    The system is scarcely safer today.

    https://www.telegraph.co.uk/business/2018/10/31/trumps-iran-squeeze-threatens-150-oil-world-recession/

    • Sven Røgeberg says:

      «The energy intensity of the world economy has halved since the OPEC crises of the 1970s.« what does he mean by that?

      • The world economy creates twice as much inflation-adjusted GDP per Ton of Oil Equivalent comparing data for 2017 to that for an earlier date, such as 1973. So over a 44 year period, there has been a 50% change–a little over 1% per year on average.

        It seems to be related to what I was writing about in this post, back in 2011:
        https://ourfiniteworld.com/2011/11/15/is-it-really-possible-to-decouple-gdp-growth-from-energy-growth/

        At the time I wrote that, I didn’t have numbers going back before 1980, so all my calculations start then. GDP amounts are in inflation adjusted US dollars. In other words, the world has (1) added enough low-energy services to its mix of the goods and services it produces, and (2) has become more efficient when it actually uses fossil fuels or electricity for operating equipment that GDP has been able to rise somewhat faster than energy consumption growth.

        On the way back down, I would expect services to be lost before goods, so the leveraging from adding services would go the wrong way.

  36. Fast Eddy says:

    Who says the tax cut did not trickle down…. imagine the bankruptcies and layoffs without the tax cut…..

    But the corporate tax cuts saved the day

    With operating profit down 3.6% (at $204 million), and total interest expense up 11% (at $61 million), pretax income fell 8.1%, or by $12.8 million, to $145 million.

    But thank you, thank you, thank you for the corporate tax cuts. Income tax provisions plunged by 46% from $60.3 million in Q3 a year ago to $32.8 million: “We have not completed our accounting for the tax effects of enactment of the Act; however, we made a reasonable estimate of the effects,” the company said.

    And due to this $27.5 million reduction in income taxes, after-tax net income actually rose 15% to $112 million.

    So that tax cut came in the nick of time, to temporarily overcome the growing “double whammy” as Jackson put it, generated by what is still just the normalization of interest rates, layered on top of rising prices, and consumers having to juggle it all.

    https://wolfstreet.com/2018/10/31/autonation-hit-by-double-whammy-of-rising-rates-for-us-and-our-consumers/

  37. Fast Eddy says:

    “Double Whammy of Rising Rates for Us and Our Consumers”: AutoNation

    We knew “free money would inevitably end. Affordability would become an issue – particularly around new vehicles.”

    It has been a tad rough in the stock market for AutoNation, the largest auto retailer in the US, with 242 new-vehicle dealerships, selling 33 brands, including Toyota, Lexus, Honda, Acura, Ford, GM’s brands, Fiat-Chrysler, Mercedes-Benz, Nissan, Infiniti, BMW, Volkswagen, Audi, Porsche, etc. After the company reported earnings on Tuesday, shares [AN] dropped 4%, and this morning, they’re down another 3% (despite the overall market which has been up sharply on both days). Shares have now plunged 37% from their 52-week high in January.

    The problem is in new-vehicles sales.

    Many customers are strung out by high vehicle prices and rising interest rates, and they’re switching to used vehicles, which AutoNation also sells – and that part of the business is good. But the new-vehicle business was lousy in the third quarter, compared to the same period last year:

    New-vehicle sales fell 5.6%, to $2.93 billion.

    The number of new vehicles retailed fell 6% to 78,300 vehicles (overall industry sales fell 4%).
    Due to rising prices from manufacturers and a consumer shift from cars to more expensive SUVs and trucks, average revenue per new vehicle retailed rose by nearly $1,000 to $37,017.
    New-vehicle gross profit (revenue minus what manufacturers charge after incentives) plunged 13.4% to $125 million.

    Per new vehicle retailed, gross profit dropped 7% to $1,571.

    More https://wolfstreet.com/2018/10/31/autonation-hit-by-double-whammy-of-rising-rates-for-us-and-our-consumers/

  38. Fast Eddy says:

    kkkk.limate
    noun
    the w.eather conditions prevailing in an area in general or over a long period.

    w.eather
    noun
    the state of the atmosphere at a particular place and time as regards heat, cloudiness, dryness, sunshine, wind, rain, etc.

    Ever notice how the MSM focuses on the wether….. a particularly hurricane… a flood….a drought…the melting of ice over a short period

    And they completely ignore wether events that destroy their narrative … no hurricanes for years… expanding glaciers… etc…

    And then there is this …. which is actually relevant because it IS kkkkklimate data… no wether….

    For obvious reasons…. it is ignored….

    KKKLIMATE DATA FAKED

    by John Bates (leading kkklimate scientist)

    In the following sections, I provide the details of how Mr. Karl failed to disclose critical information to NOAA, Science Magazine, and Chairman Smith regarding the datasets used in K15. I have extensive documentation that provides independent verification of the story below. I also provide my suggestions for how we might keep such a flagrant manipulation of scientific integrity guidelines and scientific publication standards from happening in the future. Finally, I provide some links to examples of what well documented CDRs look like that readers might contrast and compare with what Mr. Karl has provided.

    https://judithcurry.com/2017/02/04/c limate-scientists-versus-c limate-data/

    ringy dingy … wake up meat heads…. shake the rocks out

  39. Harry McGibbs says:

    More problems with the car industry. Jaguar is the UK’s largest car manufacturer:

    “Sales of Jaguar Land Rover cars have fallen sharply, taking the firm into a loss for the three months to the end of September.

    “The firm blamed lower sales in China for the decline, as well as uncertainty in Europe over diesel and Brexit.

    “Jaguar Land Rover made a pre-tax loss of £90m for the quarter, compared to a profit for the same period a year ago.

    “JLR said as a result, it was launching a “far-reaching” cost-cutting programme to improve profitability.”

    https://www.bbc.co.uk/news/business

  40. Artleads says:

    GENTRIFICATION AND STREET APPEARANCE

    You can’t change the appearance of a place without changing the demographics of the place.

    A new look involving new buildings will cost more to the old residents through higher taxes and higher property values that prices them out. As well as other changes. One of those other changes is that new places tend to look more mainstream and therefore make outsiders feel more welcome to move in. Under the surface, those new people know that the place does not have a sense of itself, and can easily be taken over.

    The dynamics of outside invasion of that sort are determined more by the view from the street than anything else.

    Those who claim only to want more density, then go about changing the look of the street are being disingenuous, for no end of new density can be located behind and away from the street, thus preserving the look of the street.

    Consciously or unconsciously developers feel that they must change the street to invite in the market that is inspired by the altered look of the street. This is psychology at work.

    • I think you are correct, from what I have seen. There are not many folks from the suburbs that would want to move to a street that looks like a slum.

      • Artleads says:

        And they tend to look like a slum because locals don’t appreciate their historic pedigree or potential (see Detroit) and lack the training to keep them fairly attractive and from falling apart. Sometimes, just sweeping the sidewalk would help. Th right colors, the right shrubs properly place…all these low cost interventions are a matter of mindset rather than anything else.

      • Artleads says:

        What I need to know is whether a place not being mainstream looking, and not having a style that can be associated with the mainstream, new look (but is otherwise presentable) will also keep suburbanites away.

        • I don’t know. They seem to follow the crowd a lot. They like whatever is in fashion at the moment. They want to rip out the interior of the house, to be like everyone else’s. We have had a variety of home styles over the years. The old ones seem to become “dated”–associated with a particular period. A new style, but not year popular, might or might not work.

          • Artleads says:

            That makes sense to me. There’s a historic preservation program called “facadism.” You can tear out the inside all you wish, but you can’t change outer surface facing the road.

            https://en.wikipedia.org/wiki/Facadism

            • Fast Eddy says:

              How Potemkin-esque

            • Artleads says:

              The examples shown by Wikepedia are part of the problem. Elitist monster starchitecture seen as the norm, when it shouldn’t be. There is no need to go to high priced extremes they illustrate,. A funky low income community with some 40’s and 50’s so so buildings can simply claim them as historic in this time of ever newer and bigger and fad-ier, and clean up the place and repair and repaint with precision, and connect that old “fabric” to newer fabric behind. And do it thoughtfully.

            • doomphd says:

              you seem to be rearranging the deck chairs. i assure you that the hungry mauraduers will find your abode, no matter how well you try to mask it. see The Road for some tips.

            • Artleads says:

              “you seem to be rearranging the deck chairs. i assure you that the hungry mauraduers will find your abode, no matter how well you try to mask it. see The Road for some tips.”

              Hungry marauders come out after a civilization collapses in such a way that there is no food available and no social order. That would be too late to do anything at all.

              What I’m about is to extend civilization by avoiding avoidable errors. This article talks about “architectural determinism.” Whatever problem there is perceived to be in society putting up buildings will solve it. Unfortunately, it doesn’t work that way. And facadism is my recommended way of attacking this insane religion” of newness through building. it’s hard to see how this approach wouldn’t encourage people to think a little more about development.

              It’s an important matter to address, for developers and planners might well be the most dangerous people in the world–the Emperor with no clothes–while everybody keep talking about climate and coal instead.

              DELUSIONS OF DEVELOPMENT

              “Broady elaborated on the British case, where the cohesion observed in low income areas was attempted in planned communities:

              Of course people do meet each other and chat in pubs and corner shops. But not all pubs and corner shops engender… neighborliness. It is true that neighborliness is induced by environmental factors. Of these, however, the most relevant are social and economic rather than physical.
              —Maurice Broady, “Social Theory in Architectural Design,”Robert Gutman, ed., People and Buildings, (New York: Basic Books, 1972), p. 174)

              A London pub. Photo by Chuck Wolfe.
              In 1952, the especially perceptive Catherine Bauer summarized how early planners often failed to understand the broader forces at play in the urban development process, or innocently overlooked the consequences of their actions:

              What we failed to see was that the powerful tools employed for civic development and home production also predetermine social structure to such an extent that there is little room left for free personal choice or flexible adjustment. The big social decisions are all made in advance, inherent in the planning and building process. And if these decisions are not made responsibly and democratically, then they are made irresponsibly by the accidents of technology, the myths of property interest, or the blindness and prejudice of a reactionary minority.
              (Catherine Bauer, Social Questions in Housing and Town Planning (London: University of London Press, 1952), p. 25)”

              https://www.cnu.org/…/overselling-utopia-urbanist%E2%80…

            • doomphd says:

              you’re quoting a 1952 book. things have changed. if we get another decade of BAU, it will be miraculous. a some point, our economy will freeze. our empire will crumble. the facades won’t matter and will also crumble. many here think 2025 is the year, if not sooner.

  41. adonis says:

    new data has just come in I have revised the collapse date to 11th of November 2018 I feel like this is it the end of the road for the middle class as plan B is set into motion by the NEW WORLD ORDER.

    • Rodster says:

      November 11th is neither on Monday or Tuesday, so the collapse can’t happen on the 11th.

      • jupiviv says:

        Who started this revisionist “Tuesday” nonsense? It’s Monday or BAU forevah dammit!

        • Dan says:

          Dow up over 400 pts – We will see – Oil is up slightly.

          Believe it or not I dreamed of $100 oil last night – maybe my dream was caused by the dinner conversation I had with my wife about prepping or my lack of lately and why.
          We had meatloaf and mashed potatos with a salad btw.

        • Rodster says:

          I don’t know but it’s a funny meme.

  42. Harry McGibbs says:

    “Beef is making a rarer appearance at the dinner tables of middle-class families as Argentina spirals deeper into economic turmoil, a Reuters review of meat industry data and interviews with consumers, butchers and ranchers has found. It’s one of the clearest signs of how far Argentines have seen their purchasing power slashed by inflation, which is expected to surpass 44 percent by year’s end, according to the latest central bank poll.”

    https://www.reuters.com/article/us-argentina-economy-beef-insight/less-meat-more-pasta-how-the-economic-crisis-is-changing-argentinas-diet-idUSKCN1N41DO

  43. Harry McGibbs says:

    “The Chinese economy has revealed fresh signs of the pressure of a trade war with the US and a wider slowdown at home as manufacturing activity fell and the yuan was fixed at a new 10-year low to the dollar. China’s manufacturing sector barely expanded in October as both domestic and external demand ebbed, according to a closely watched metric released on Wednesday.”

    https://www.theguardian.com/business/2018/oct/31/china-reveals-trade-war-strain-as-yuan-slides-and-manufacturing-stalls

    • Harry McGibbs says:

      “South Korea’s factory activity in September was at its weakest since the wake of the 2008 global financial crisis amid faltering automobile segment and softening in electronics components. According to the Statistics Korea on Wednesday, the seasonally adjusted mining and manufacturing output in September fell 2.5 percent on month…”

      https://pulsenews.co.kr/view.php?year=2018&no=680062

  44. Harry McGibbs says:

    “Economic growth in the eurozone has fallen to its slowest pace in more than four years, and Italy is not growing at all, according to figures released Tuesday. The snapshot is likely to sharpen political divisions in the European Union and make the region more vulnerable to the forces rattling financial markets.

    “The eurozone grew 0.2 percent from July through September compared with the previous quarter, according to the European Union statistics agency. Separately, Italy’s government statistics office said growth during the third quarter was zero as manufacturing slumped.

    “Both numbers were unexpectedly poor. Eurozone growth in the quarter was only half as fast as it had been in the previous three-month period, and the rate of growth has fallen each of the last three quarters.

    “Italy’s stagnation is likely to heighten the dispute between the populist government in Rome and officials in Brussels. The European Commission has said that Italy’s proposed budget — full of debt-financed welfare programs — flouts spending limits that countries in the European Union are supposed to observe.”

    https://www.nytimes.com/2018/10/30/business/eurozone-economy-gdp.html

    • Harry McGibbs says:

      “Italian bonds dropped as disappointing economic growth and a tepid debt sale damped investor enthusiasm. The securities snapped a three-day rally after the nation’s growth stagnated in the third quarter and sale prices for 10-year debt at the Treasury auction were below market levels. The weaker average sale price reflected fragile investor sentiment after rating agencies cut their view on the sovereign’s outlook.”

      https://www.bloomberg.com/news/articles/2018-10-30/italian-bond-yields-rise-as-economic-growth-undershoots-forecast

    • I expect that the real numbers are even somewhat worse than reported. No country wants to report bad GDP results, so takes the benefit of the doubt in every calculation. For example, inflation impacts can be understated, such as those caused by the falling Euro relative to the US dollar. I see that the Euro is 1.134 to the dollar now. That is fairly low.

      • Rodster says:

        To show you how bad our financial system has become over the decades with exponential growth, Samsung’s stock was hit real hard yesterday. They overall reported great numbers but the numbers did not show exponential growth for their smartphone division but good overall by anyone’s standards and the markets reacted negatively. Apple has been in the same boat now for at least 5 years. If they don’t shatter their own sales record and beat, street estimates their stock gets hammered the same or next day.

        Rewind 5-6 decades ago and when IBM would post flat to good earnings their stock would not get hammered and they actually designed and made their own computers in the US. Now everyone’s sales needs to look like a backwards hockey stick and it can’t stop for one qtr.

    • Dan says:

      Why doesn’t Italy create some money and issue it to companies as debt at little to no interest and then the companies buy their own stock increasing its price. Sheesh its pretty simple when you say it out loud.

  45. Fast Eddy says:

    Hong Kong homeowners who bought flats in the last several months have seen their value decline as much as 20% in a matter of weeks, according to HSBC, sending values into negative equity which had only left the region in early 2017, reports the South China Morning Post.

    https://www.scmp.com/business/article/2170560/negative-equity-returns-hong-kong-small-flats-value-drop-20-cent-declining

    http://factspy.net/wp-content/uploads/2011/11/BRACE50.jpg

    The Long Emergency….. is coming to an abrupt end….

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