Most people expect that our signal of an impending reduction in world oil or coal production will be high prices. Looking at historical data (for example, this post and this post), this is precisely the opposite of the correct price signal. Oil and coal supplies decline because prices fall too low for producers. These producers make voluntary cutbacks because the prices they receive fall below their cost of production. There often are supply gluts at the same time.
This strange situation arises because prices must be high enough for the producers at the same time that goods and services made by oil (and other energy products) are inexpensive enough for consumers to afford. There is a two way battle taking place:
(1) Prices producers require tend to rise over time, because of depletion. The easiest to extract portion of any resource (such as oil, coal, copper, or lithium) tends to be removed first. What is left tends to be deeper, lower quality, or otherwise more difficult to extract cheaply.
(2) Prices consumers can afford for discretionary goods (such as cell phones and automobiles) tend to fall for a combination of reasons:
- Wages of many workers fall because of competition from lower cost labor in other countries.
- Some jobs are eliminated through the use of computers or robots.
- Young people are increasingly being required to pay for higher education (beyond that which is provided free), leaving many with loans to repay, reducing their discretionary income.
- Changes to US healthcare law (mostly starting January 1, 2014) lead to required health insurance premiums. While some citizens find cost savings in this approach, healthy young people often experience cutbacks in discretionary income as a result.
- Rents and home prices keep rising faster than incomes.
When the discretionary income of the many non-elite workers of the world falls, they buy fewer finished goods and services. Finished goods and services are manufactured using commodities of many kinds, including oil, coal, copper, iron ore, and fresh water. When discretionary demand falls, commodity prices tend to fall. This is the problem we are encountering now. It tends to cause the prices of many commodities to fall below the cost of production. Eventually, producers decide to quit because production is no longer profitable. This is the issue that leads to peak oil, coal or copper.
Figure 1. Illustration showing why falling affordability creates a conflict between supply and demand.
If the Affordability Price Clash Mostly Affects Non-Elite Workers, Does It Matter?
When I talk about non-elite workers, I am talking about workers who are in the bottom 90% of the wage distribution. Elite workers will always have enough income for the necessities of life. There are so many non-elite workers in the world that they, indeed, do make a difference.
Also, the forces that adversely affect non-elite workers tend to have several effects:
- They tend to send a larger share of wages to elite workers, as the economy becomes more complex and more specialized.
- They tend to send more unearned income to elite workers, through capital appreciation, because elite workers can afford to buy shares of stock and expensive homes.
- The wealthy spend their income differently from non-elite workers. Non-elite workers tend to spend the bulk of their discretionary income on devices made using commodities, such as cell phones and automobiles. The wealthy are likely to spend their discretionary income in less energy intensive ways, such as investing in shares of stock and buying services such as private college education for their children.
History shows that economies tend to collapse when wage and wealth disparity becomes too great. Collapse can take various forms, including revolutions by the disgruntled underclass, increased susceptibility to epidemics, or the financial collapse of governments. Wars become more likely, as one country tries to aid its citizens at the expense of citizens of other countries.
The world today seems to be approaching a crisis point with respect to wage and wealth disparity. Young people in particular are adversely affected. Figure 2 shows a chart indicating that wage disparity seems to be back to the level it was at the time of the Great Depression of the 1930s. This was also a time of low commodity prices and gluts of food and oil.
Figure 2. U. S. Income Shares of Top 1% and Top 0.1%, Wikipedia exhibit by Piketty and Saez.
Gluts tend to occur because commodity prices rise to a level where devices made with these commodities (such as cell phones and automobiles) become too expensive for non-elite workers to afford. Elite workers can still afford the devices, but there are not enough elite workers to make up for the shortfall in non-elite buyers of these devices, so industrial output per capita tends to fall.
Figure 3 shows the important role that the wages of non-elite workers play in generating adequate demand. If their wages are high enough, they can buy enough goods and services made with commodities to keep commodity prices high. With sufficiently high commodity prices, production can continue.
Figure 3: Chart showing the important role that the wages of non-elite workers play in maintaining energy demand. With adequate demand, prices can remain high enough for production to continue.
Why the Peak in World Oil Production Likely Occurred in 2018
If we look at recent oil data, we see a pattern of growing gluts in supply, as indicated by the red bars in Figure 4. Even in the most recent week, the week ending February 15, 2019, after all of the cuts begun by OPEC and other oil exporters, US crude oil stocks continue to build. This is not the impact a person would expect, if the production cuts are truly effective!
Figure 4. Brent average quarterly oil price (in January 2019$), with an indication of quarters when world crude oil inventories are building. Oil prices are Brent spot oil prices, adjusted using the CPI-Urban to January 2019 prices levels. World inventory build quarters are based on indications shown in US Short Term Energy Outlook reports of various publication dates.
This is precisely the kind of signal we would expect, if products made with oil (and using oil in their operation) are becoming increasingly unaffordable for the non-elite workers of the world. Note that these bars are becoming more frequent and are occurring at lower prices. This is the expected outcome of a clash between the falling discretionary income of non-elite workers and the rising costs of oil producers.
When prices fall too low, producers cut back production. OPEC reports its view of the effect of recent production cutbacks in Figure 5.
Figure 5. OPEC and world oil supply, in chart from OPEC Monthly Oil Market Report for February 2019.
Given the nearly worldwide problem of falling affordability of goods by non-elite workers, we should not be surprised if the peaks in oil production in October and November 2018 ultimately prove to be the maximum production ever recorded. In fact, it seems quite likely that the year 2018 will prove to be the year with the highest-ever oil production.
The cutback in production will appear to be voluntary. Once cutbacks start, they will tend to feed upon themselves. Unless oil prices really spike following the cutbacks (say, to $90 per barrel), exporting countries will find themselves worse off after the cutbacks, for a combination of reasons:
-
- The cutback in production will reduce the number of workers directly and indirectly employed by the oil industry. Their reduced spending will lead to a need for expanded government programs.
- Housing prices will fall in oil exporting countries. This is likely to ultimately lead to debt defaults.
- Tax revenue that governments of oil exporters can collect on the smaller amount of oil will be lower, even though the needs of the economy will be greater.
Ultimately, it seems likely that at least some governments of oil exporting countries will be overthrown, depressing oil production further. If the breakeven price for most OPEC members, including necessary tax revenue, was over $100 per barrel in 2014, it is hard to see how exporters can get along with much less today.
World Coal Production: Following a Similar Pattern to Oil?
One thing that most people don’t realize is that coal prices follow a very similar pattern to those of oil.
Figure 6. Sample world coal prices, based on information from 2018 BP Statistical Review of World Energy.
In Figure 6, coal prices experience a major peak in 2008, followed by a lower peak in the 2011 period, which peters out by 2013. Prices recently are much lower than in the 2008 period, or in the 2011 to 2013 period. This pattern is very similar to the recent pattern in oil prices.
The similarity in the patterns of coal prices and oil prices makes perfect sense if prices of both oil and coal are based primarily on affordability, and this affordability depends heavily on the wages of non-elite workers. When countries, such as China, ramp up their debt, more non-elite workers can be hired at higher wages. These workers can make more computers, automobiles, steel ingots, and many other goods. They can also afford to buy more output of the world economy. This ramped up demand tends to raise the prices of both coal and oil.
For many commodities, China’s demand represents close to half of the world demand. China has become the world’s number one manufacturer of goods. China needs growing energy consumption to maintain its growth of manufactured goods because it takes energy to operate machines, even computers. It even takes energy to keep the lights on.
Unfortunately, with the recent lower prices for coal and oil, China is experiencing lower production of both coal and oil (Figure 7). Without growing energy supplies, China cannot meet the world’s growing need for manufactured goods.
Figure 7. China energy production by fuel, based on 2018 BP Statistical Review of World Energy data.
The reason why China has recently reduced production of both coal and oil is the usual one: the rising cost of production conflicts with the low prices available in the marketplace, making production unprofitable for a growing share of producers.
How about China’s total energy consumption? Do imports make up for China’s lack of local production?
Figure 8. China energy production by fuel, with a line added to indicated it total energy consumption, including imports. Based on BP Statistical Review of World Energy 2018 data.
Not really. China is the world’s largest importer of coal, oil and natural gas. It is also the number one user of wind and solar (included in the tiny orange “Other Renewables” portion of the chart). Even with these huge additions to China’s energy production, its annual growth in the quantity of energy it consumes (including imports) has plummeted (Figure 9).
Figure 9. China annual growth in total energy consumption. Based on 2018 BP Statistical Review of World Energy data.
China reports that its real GDP growth rate is still very high (over 6%, net of inflation), but many observers are skeptical of this claim. Certainly, going forward, its coal and oil production cannot continue to decline, or the economy will encounter huge problems. The amount of goods China will be able to manufacture will fall, as will the number of new homes it can build. Without continued growth, China is likely to run into debt default problems. China is such a large country that its problems can be expected to adversely affect the world economy as a whole.
Figure 10 shows that China produces nearly half of the world’s total coal. If China’s coal production declines, world production is also likely to decline.
Figure 10. World coal production, divided into China and Non-China, based on 2018 BP Statistical Review of World Energy data.
The only way to prop up coal production, for either China or the rest of the world, is higher prices, indirectly coming from higher demand from non-elite workers. Businesses can perhaps use rising debt to hire these non-elite workers but, if there is not a sufficient supply of buyers who can afford the additional goods and services made by these workers, the final outcome will be debt defaults.
The Fundamental Problem Is a Physics Problem
The fundamental problem is that the economy grows for the same reason that hurricanes, ecosystems, stars, and plants and animals grow. They are dissipative structures that grow in the presence of energy flows. In the case of hurricanes, the energy comes from the heat in the warm ocean. In the case of the economy, the energy flows are of many different types, including (among others), human energy, energy of draft animals, solar energy, fossil fuels, and wind energy.
One key characteristic of dissipative structures is that they are not permanent. Permanent growth in a finite system is not possible. The laws of physics sets up the system in such a way that dissipative structures grow and eventually collapse. Over time, new dissipative structures form, each varying in a random way from previous dissipative structures. Those best adapted to the ever-changing circumstances tend to last the longest. This is the way that the evolution of economies takes place, just as the evolution of plants and animals takes place.
One characteristic of economies is that physics determines how much energy is needed to manufacture and transport a particular product. It also determines how much the mix of buyers can afford to pay for finished products using this energy. Thus, physics determines the potential profitability of a particular manufacturing process, with lower energy costs tending to make production more profitable. As energy costs rise because of diminishing returns, the system eventually reaches a point where it must collapse. The cost of production rises so high, relative to wages, that many non-elite workers cannot afford the finished goods and services made by the system.
The laws of physics also determine what wage distributions must look like, given the availability of energy and other resources. In general, if there are not enough resources to go around, some members of the economy tend to get “frozen out” by low wages. In addition, in a low-energy per capita situation, the energy that is available tends to rise to the top, to the high-earners of the economy, somewhat like heating water transforms it to its gas phase (steam), which rises to the top. With this structure, even with a severe energy shortfall, some members of the economy can be survivors.
With today’s worldwide economy, the survivors might be some humans and businesses within the world economy. The system would need to start over, building up smaller economies from pieces that managed to stay intact, but the system, as a whole, would not die out, unless the energy shortfall were to be severe.
Modeling the World Economy
One issue with academic research today is that it tends to be divided into many academic “silos.” Researchers tend to know more and more about their own field, but less and less about other fields that might be peripherally related. For example, economists tend not to keep up with the physics of self-organizing networked systems. Geophysicists understand the physics that governs the extraction of fuels, but they have no insight into the fact that the laws of physics might also affect prices and wage distributions.
Without understanding the forces that are causing the results that are being observed, it is very easy to create a model that is more misleading than helpful. For example, a simple model of the earth is the one each of us can see as we look around us.
Figure 11. Source: Edrawsoft.com
The model shown in Figure 11 is a flat map. This is a perfectly good representation of what the earth looks like, if a person is not concerned about what happens at a distance. Of course, to extend the map out, a person really needs to convert the model into a globe. A globe is a very different model.
Economic researchers tend to have some of the same modeling issues as illustrated by the flat map model. Economists favor fitting curves to past data to forecast the future patterns. Curve fitting tends not to be good for determining turning points. When dealing with energy and other resources, we are really interested in when a turning point will happen, forcing production of energy products and resources of many kinds downward.
Another model favored by economists is the standard two-dimensional supply and demand model (Figure 12). This model ignores the special role that energy products play because of the operation of the laws of physics. Energy products, as they work through the networked economy, affect both the supply and demand of finished goods and services, making the two dimensional model shown inappropriate.
Figure 12. This standard model does not consider the special role energy plays in the economy under the laws of physics, so is not appropriate for energy products.
With neither curve fitting nor the standard supply and demand model sounding an alarm with respect to energy prices not being able to rise forever, economists have tended to overlook this issue.
Figure 13. Economic models tend to give a false sense of security because they forecast that the future will be a continuation of the past.
Of course, policymakers are happy to hear happily-ever-after endings. Few policymakers question the reasonableness of the models. They do not consider the possibility that the falling discretionary income of non-elite workers around the world might choke off demand for goods made with energy products.
Even geophysicists who have looked at the problem tend to get the story only half right. They understand underground physics, but they tend not to understand that prices cannot rise indefinitely. This is a different, related issue, also associated with the physics of the situation.
“Climate Change Is Our Biggest Problem” Is a Corollary to Bad Modeling
If a person truly believes that energy prices can and will rise forever, then it is an easy corollary to assume that all fossil fuels that we can identify within the earth’s crust will eventually become extractable. There are no limits except for the limits imposed by climate change.
Of course, if we are really hitting price limits here and now, the situation is likely to be very different. These price limits will cause a very near-term decline in energy supply, which we essentially have no control over. Financial systems are likely to collapse; international trade will be scaled way back; world population is likely to fall. CO2 levels will, in time, adjust to this radically changed world.
I showed earlier (in How the Peak Oil story could be “close,” but not quite right) that the models used to “prove” that wind and solar can be helpful to the system greatly overstate their benefit to the system. As a result, we don’t really have evidence that wind and solar are even helpful to the system.
Consequently, we really have two false models working together to give an illusion that we have a huge problem which is fixable, if we just exert enough effort. Physics puts a cap on our efforts, however. The physics of the system makes the system collapse before policymakers can hope to even make a small fix.
Figure 14. Two false models work together to give the illusion that climate change is the greatest problem that humans have and that we can fix the problem with fixes to the fuel system.
The unfortunate problem is that policymakers are not really in charge: the laws of physics are in charge. Energy and other resources are no longer inexpensive enough to extract to allow the system to work. The proposed solutions (wind and solar) are not cheap enough to save the system either. We can temporarily hide the problem with more debt (indirect promises of future energy) at lower interest rates, but this does not fix the system.
Conclusion
Many of the problems the world economy is facing today seem to be the result of reaching the limits of energy extraction. Very few researchers understand how a self-organized networked economy really operates. As a result, the symptoms of economic health and economic illness have been confused. It looks quite possible that we have reached both Peak Oil and Peak Coal, approximately simultaneously. This is a frightening situation, because it could be an indication of collapse in the next few years. This would likely be much worse than the Depression of the 1930s.
Of course, even with these observations, we do not know precisely what lies ahead. Somehow, multicellular animals have lived on this earth for a very long time. Amazing coincidences have happened and may continue to happen, allowing economies to flourish. We humans do not have as much control over the current situation as we would like to think that we have. Fortunately, we cannot rule out the possibility of more amazing coincidences, perhaps even caused by a literal Higher Power behind the energy flows. Thus, the result may be different from what our models seem to suggest.
“Appomattox is currently slated to come on production in 3Q 2019, so it won’t impact 2019 numbers too much, but could have a decent impact on 2020. But the production uplift Appomattox brings in 2020 could be largely offset by overall declines from everywhere else.
I don’t think there are any projects with significant production slated to come on line in 2020 – the biggest I’m aware of is the latest phase at BP’s Atlantis, which is predicted to add about 40 kbopd.
I see production staying fairly flat for 2019 and 2020 – 1.7-1.8 mmbopd each year. These would still be at or above record numbers.
The next big projects slated to come online are Shell’s Vito in 2021 (100 kbopd capacity) and BP’s Mad Dog 2 (140 kbopd capacity) soon thereafter.
Maybe, with these projects coming on line, there’s another chance to boost production to new record levels, but not til the 2021-2022 time frame. But I’m not sure I want to predict that at this time.”
We shall see—–
I think that once a big recession hits, and price drops very low, say to 20 barrel, production falls way back. Even the level of cutbacks seen in China and Germany could spread. The demand side is more important than the supply side.
Production is going down, even at increasing prices.
Physical reality is setting in–
Also, investment decisions made to the last few years, when oil prices were lower, are starting to have an impact.
Yes–
Investment was curtailed– except on the shale front, with continued losses—
A different business model, obviously.
Sorry I don’t have a new post ready. It may be the beginning of next week. I have been distracted by a couple of other things.
US & Iraq keeps us from peak oil.
http://crudeoilpeak.info/wp-content/uploads/World_crude_production_1994-May2018.jpg
Yep–
But I may be wrong on 2019 as peak.
It looks like 2018.
The game is becoming over– shale in the US (Permian) is about the only thing left.
http://peakoilbarrel.com/wp-content/uploads/2019/03/OPECRussiCanada.jpg
It seems OPEC peaked in 2016.
“The World Bank will lend Angola $1 billion to fund social security and water projects, the president’s office said on Wednesday. Angola, Africa’s second largest oil producer, has been pushed into an economic crisis by the fall in oil prices since mid-2014.”
https://www.reuters.com/article/angola-worldbank/world-bank-to-lend-angola-1-billion-idUSL8N2106KA
“Venezuela’s largest private food supplier says massive looting and vandalism occurred at four facilities in the city of Maracaibo during nationwide power outages, complicating efforts to distribute food and drinks to people in the area.”
https://www.japantimes.co.jp/news/2019/03/14/world/social-issues-world/venezuelan-food-supplier-reports-looting-blackouts/#.XIoeTij7TIU
“While the power outage in [Venezuela] has shut down oil production and processing operations as well as the main oil export terminal, the blackout has caused massive shortages of running water.
“Residents in the town of San Diego in the Carabobo state woke up to see black stuff running from their taps on Wednesday in what appeared to be water contaminated with crude oil.
“Local journalist Heberlizeth González posted a video on Twitter, showing that water in the area is not suitable for consumption, and saying that the situation is “terrible” and there are districts without water service for two months.
“Without power, the utilities have not been able to pump water to the homes.”
https://oilprice.com/Energy/Energy-General/Venezuelas-Latest-Nightmare-Crude-Oil-In-The-Tap-Water.html
People do not understand how important electricity is for keeping the rest of the system going. Once electricity stops, a population loses most other services.
Angola clearly needs the revenue for reinvestment and taxes that high oil prices offer. Today’s prices, even with the recent run up, are far too low.
“The single most pressing economic problem in Thailand is household debt. Actually, the household debt issue is currently the world’s most important economic issue too. With the prevailing debt in major economies, it is difficult to see the world’s economy moving beyond a 2% annual growth rate. The household debt problem has already triggered a global financial crisis, namely the Lehman Brothers crisis in 2008. And it can trigger a similar crisis in China any time.”
https://www.bangkokpost.com/opinion/opinion/1644312/household-debt-squeezing-the-nation
“New Zealanders have a debt problem. In the past seven years, household debt has skyrocketed…Kiwis are spending more money that they don’t have. It’s a signal to economists that the foundations are shaky.”
https://www.moneymorning.co.nz/our-ticking-time-bomb-why-kiwi-debt-is-about-to-explode/2019/03/14/
“Toronto households are some of the most indebted in [Canada], with the average family owing more than twice the amount they bring in.”
https://www.citynews1130.com/video/2019/03/13/household-debt-worries-mounting-for-canadians/
“While the overall level of [US] consumer borrowing is rising at a steady pace, one subset of loans, those linked to car purchases, has risen sharply over the past year.
“This is particularly true in the “subprime category” — those high-risk borrowers with a FICO consumer credit score below 620 (the bare minimum score required to be approved for a conventional mortgage in the US). More striking still, defaults on those subprime auto loans appear to have surged.”
https://www.ft.com/content/1ce6d32e-4520-11e9-b168-96a37d002cd3
“Sub-prime mortgage lender Magellan Homeloans [UK] has called time on all new lending with immediate effect, claiming competitive pressures in the mortgage market. In a statement released today, the specialist mortgage lender said increasingly expensive funding costs combined with the competitive pressure to keep mortgage rates low meant it could no longer justify making new loans.”
https://www.dailymail.co.uk/money/mortgageshome/article-6804345/Another-mortgage-lender-closes-doors-investors-fright.html
Sounds like another version of very low or negative return on investment.
New Zealand!? No way…can’t be! That’s the lifeboat the SuperSmartSmarties are nesting on to continue BAU after the “End of the World Party”.
If everyone sticks together and cooperates, work together…things will be OK…just like in the Movies…
https://m.youtube.com/watch?v=t4yu80ZhI5Q
Wonder what part FE is playing here? Sprechen die Deutsch?
Female Passenger: How are we going to get home?
Sailor #1: We have to find someone that can not only sail this boat but, also didn’t have fish for dinner.
Sailor #2: Shirley you got to be kidding!
Sailor #1: I’m not kidding, and stop calling me Shirley.
Rising debt works as a stimulus, until the return on that debt falls too low. We seem to be reaching that limit now.
“Chinese factory output slowed to its weakest pace on record early this year, a sign that the economy remained under pressure from US tariffs and weaker domestic demand despite a series of economic stimulus measures in recent months.”
https://www.ft.com/content/a2c7edf8-45fb-11e9-b168-96a37d002cd3
“For years, China’s biggest borrowers relied on accounting alchemy to prop up their balance sheets. Those days are over. Corporate perpetual bonds have almost always been recognized by Chinese auditors as equity, not debt. That enabled state-owned enterprises to borrow billions of dollars without it showing up that way.”
https://www.washingtonpost.com/business/the-spell-that-made-chinas-debt-vanish-is-broken/2019/03/13/dad47878-45e3-11e9-94ab-d2dda3c0df52_story.html
China seems to have a lot of ways to “cook the books.”
Setting ALL KINDS of Records…
Promises, promises…are meant not to kept…
The budget would curb the growth of Medicare and Medicaid, two programs Mr. Trump had previously pledged to leave intact. And it proposes shaving $818 billion from projected spending on Medicare over 10 years and cutting nearly $1.5 trillion from projected spending on Medicaid.
In place of the open-ended federal contribution to Medicaid, Mr. Trump would give states “market-based health care grants” — lump sums of federal money or per capita allotments — totaling $1.2 trillion over 10 years. Congress rejected this idea in 2017 when Republicans proposed it because it would essentially cap Medicaid payments at a fixed level and would not keep pace with rising health care costs.
Mr. Trump also proposed new work requirements for working-age adult recipients of food stamps, federal housing support and Medicaid, a move the administration said
would reduce spending on those programs by $327 billion over a decade because it would disqualify many who currently receive assistance.
Payments to a variety of health care providers would also be cut. Medicare payments to hospitals for unpaid bills and uncompensated care would be reduced by $136 billion over 10 years. Mr. Trump would cut projected Medicare payments to hospital outpatient departments by $131 billion over 10 years.
In addition, the budget squeezes more than $100 billion over 10 years from Medicare payments to nursing homes and home health agencies that care for Medicare patients who have left the hospital.
The president offers a suite of proposals to lower prescription drug prices, with federal savings estimated at $69 billion over 10 years. The changes to the drug program may have the effect of increasing premiums for Americans who rely on Medicare, but they would also, for the first time, limit the amount that seniors with very expensive drugs could be asked to pay each year. Some of the plans resemble proposals unsuccessfully offered by President Barack Obama.
And Mr. Trump proposed spending $26 billion less on Social Security programs, the federal retirement program, including a $10 billion cut to the Social Security Disability Insurance program, which provides benefits to disabled workers. Those cuts would be achieved in various ways, including more aggressively policing fraud in the program.
The largest reductions would come from spending on discretionary domestic programs, outside of the military, which would be cut by $1.1 trillion over the course of a decade.
Those cuts would not be across the board but would come from federal agencies like the Environmental Protection Agency, which Mr. Trump once promised he would reduce to “little tidbits.” The budget proposes cutting the E.P.A.’s funding by 31 per cent
Significant reductions are also requested at other agencies responsible for the United States’ energy and environmental policies, including a 70 percent cut in renewable energy research and the elimination of climate science programs across an array of agencies.
The Border Wall: What Has Trump Built So Far?
Here’s how much the proposed border deal would add to existing barriers.
The administration requested $31.7 billion for the Energy Department, an 11 percent drop from current funding. That includes about $696 million for the Office of Energy Efficiency and Renewable Energy, which provides hundreds of millions of dollars in grants each year for research into electric vehicles, battery storage and building efficiency.
It targeted the Interior Department for a 14 percent decrease, dropping its overall budget to $12.5 billion.
While Congress is unlikely to accept most of the changes, they underscore the Trump administration’s commitment to unraveling Obama-era environmental regulations — particularly those addressing climate change — and to prioritizing the development of fossil fuel resources.
At the E.P.A., the administration aims to cut a $66 million collection of voluntary climate-change-related partnerships known as the Atmospheric Protection Program that, among other things, helps businesses and local governments track planet-warming greenhouse gas emissions. It also zeros out $19 million that had been devoted to scientific research on climate change. Under a line item called “prioritize robust science,” the agency proposes a cut to $263 million from $481 million.
For the third year in a row, Mr. Trump’s budget would also cut funding for the Education Department, this time by 10 percent. Congress has repeatedly rejected efforts to reduce the department’s spending — lawmakers instead increased funding for the department last year — but an Education Department official said this year’s request reflected the “desire to have some fiscal discipline and address some higher priority needs.”
The budget seeks to cut more than two dozen programs, including a popular after-school program for many low-income students. It would eliminate higher-education programs, like the Public Service Loan Forgiveness program and subsidized federal Stafford loans, and reduce work-study funding as officials tweak the program to offer more career-oriented jobs for low-income students.
The budget also requests $700 million for school safety initiatives being coordinated by several agencies, including $200 million for the Education Department. The funding would help schools finance emergency operation plans, counseling and behavioral health programs. There are no requirements for firearms, the department said. A $1 billion federal grant program that school districts looked to tap last year for firearms would be eliminated.
A few domestic spending programs would see increases, if Mr. Trump’s budget were to become law. Those include efforts to reduce opioid addiction, as well as a 10 percent increase in health care spending for veterans. Mr. Trump will also propose a new voucher program for education, $200 billion in infrastructure spending and efforts to reduce the cost of prescription drugs.
The budget would not balance for 15 years, breaking Mr. Trump’s 2016 campaign promise to pay off the entire national debt within eight years. Mr. Trump’s first budget proposed balancing revenue and spending in 10 years. The budget released on Monday forecasts trillion-dollar deficits for four straight years, starting in 2019. Those are largely the result of Mr. Trump’s tax cut, which has been financed through increased government borrowing.
Budget details released by White House officials highlight several areas of conflict between Democrats and Mr. Trump, starting with immigration enforcement. Along with renewing the wall funding fight that led to a record government shutdown late last year, Mr. Trump is asking for more personnel at Customs and Border Protection and Immigration and Customs Enforcement and for a policy change meant to end so-called sanctuary cities, which do not hand over undocumented immigrants to federal officials when they are arrested in local crimes.
“This budget is a recipe for American decline,” said Representative John Yarmuth, Democrat of Kentucky and the chairman of the House Budget Committee. “It’s laughable that this budget is subtitled ‘Promises Kept,’ because in fact there are a lot of promises that have been violated in this budget.”
“This is a budget that we will not take seriously when we are working on our budget and spending priorities for 2020,” he said.
Disapproval from Democratic presidential candidates was just as blunt. “This is a budget for the military industrial complex, for corporate C.E.O.s, for Wall Street and for the billionaire class,” Senator Bernie Sanders, independent of Vermont, said in a statement. “It is dead on arrival.
Even some prominent Republicans greeted the president’s request somewhat coolly because it did not go far enough to reduce the growing national debt.
Representative Steve Womack, Republican of Arkansas and the ranking member on the Budget Committee, noted that only by cutting mandatory spending could the federal government seriously reduce deficits and debt.
“President Trump’s budget takes steps in the right direction, but there is still much work to do,” Mr. Womack said in a statement.
Administration officials fanned out to defend the budget. Russ Vought, the acting director of the Office of Management and Budget, blamed Democrats and Congress for the ballooning deficit, even though Democrats have not controlled Congress for years.
“We do have large deficits. That’s why we’re here transparently saying that we have a problem as a country,” he said. “It takes a long time to get out of that mess.”
Source: New York Times…
The Blame Game..George Carlin was right…they are coming after it and they are gonna get it
When there is not enough to go around, some things have to be cut or eliminated, even things like pollution control. And the spending that remains must be as close to a “jobs” program as possible. Perhaps this is how the budget needs to be understood.
I’m not too sure about not enough to go around…..seems a large increase in military spending! Not that we outspend China and Russia 2 to 1 and if we factor in our Allies spending we have approximately 80% or more of the military power of the world!
Of course, there was enough of tax cuts for the very wealthy since Ronald Reagan, George Bush (Remember the catch phrase…”The Ownership Society”, and present day recent one.
Seems the very wealthy were doing just fine and concentration of resources to the top is very unhealthy for the economy in general.
This record setting $4.75 trillion national budget does not address the sink hole and is pie in the sky make believe number juggling…from Roll Call…
4. The budget doesn’t balance. Trump’s long-term tax and spending blueprint calls for running deficits for as long as he remains in office. Deficits would decline gradually over the coming decade, from $1.1 trillion in fiscal 2020 to $202 billion in fiscal 2029. But it would take 15 years before deficits are eliminated, according to a senior administration official.
5. The White House assumes a strong economy. Trump’s plan forecasts a much rosier economy than most other government prognosticators do. It projects a 3.2 percent growth rate this year, compared to a 2.3 percent forecast by the Congressional Budget Office and the Federal Reserve. While the White House assumes growth to stay at about 3 percent through 2024, the CBO projects a rate of only 1.7 percent on average through 2023. The faster growth Trump assumes translates into an additional $2.8 trillion in revenue over the coming decade, compared to the CBO’s forecast.
6. Trump would make steeper cuts in later years. The 10-year plan calls for $2.8 trillion in savings from planned spending. That includes a $1.1 trillion cut to nondefense discretionary programs
8. Revenue would rise. The White House would double down on the 2017 tax cuts by making temporary rate reductions permanent. With robust economic growth, it forecasts revenue to rise from $3.6 trillion in fiscal 2020 to $6.3 trillion in fiscal 2029. But spending would continue to exceed revenue, leading to more deficits.
(Robust Economic Growth…..not likely).
9. The debt would get bigger. Debt held by the public would increase by about 47 percent over the decade, from $16.9 trillion this fiscal year to $24.8 trillion in fiscal 2029.
So, looks like BAU FULL THROTTLE BABY….being it on until the wheels fall off😗.
Oh, God Bless America…the shining City on the Hill!
The world economy seems to be reaching limits. Things start behaving strangely. Energy prices have been below what producers need for a long time, and this is taking its toll.
More debt is about all that might work. Running deficits is a way to add debt.
Another thing that might be somewhat helpful is cutting the demands of the EPA. Pollution still has a cost, but it is borne by the population, not businesses.
Running deficits and War….hmm…until we experience the
How did inflation affect the Weimar Republic?
Germany was already suffering from high levels of inflation due to the effects of the war and the increasing government debt. ‘Passive resistance’ meant that whilst the workers were on strike fewer industrial goods were being produced, which weakened the economy still further.
What could possibly go wrong?
P.S. Looks like the mirror image of the Late Roman Empire, massive expansive of the Government bureaucracy, military spending, and avoidance of taxes by the very wealthy.
Watch out, little people, History is repeating itself as we live!
While imperial revenues fell, imperial expenses rose sharply. More soldiers, greater proportions of cavalry, and the ruinous expense of walling in cities all added to the toll. Goods and services previously paid for by the government were now demanded in addition to monetary taxes. The steady exodus of both rich and poor from the cities and now-unprofitable professions forced Diocletian to use compulsion; most trades were made hereditary, and workers could not legally leave their jobs or travel elsewhere to seek better-paying ones.
The decline in commerce between the imperial provinces put them on a path toward increased self-sufficiency. Large landowners, who had become more self-sufficient, became less mindful of Rome’s central authority, particularly in the Western Empire, and were downright hostile toward its tax collectors. The measure of wealth at this time began to have less to do with wielding urban civil authority and more to do with controlling large agricultural estates in rural regions since this guaranteed access to the only economic resource of real value — agricultural land and the crops it produced. The common people of the empire lost economic and political status to the land-holding nobility, and the commercial middle classes waned along with their trade-derived livelihoods. The Crisis of the Third Century thus marked the beginning of a long gradual process that would transform the ancient world of Classical antiquity into the medieval one of the Early Middle Ages.
From https://en.m.wikipedia.org/wiki/Crisis_of_the_Third_Century
The rich are already fleeing New York City, ect, ect.
Ted Turner owns more land than the state of Rhode island! His pal just over took his title
In August Malone bought the 290,100-acre Bell Ranch in northeastern New Mexico, after waiting years for it to drop to what he says was a “rational price.” (The ranch was initially listed in 2006 for $110 million, then for $83 million last year. Malone is rumored to have gotten it for closer to $60 million.) Then in February he made his biggest splash, snapping up 1 million acres of timberland in Maine and New Hampshire for a “fair price.”
With that acquisition Malone became the largest private landowner in the U.S., at 2.2 million acres, according to The Land Report, which tracks sales. He surpassed his fellow billionaire Ted Turner, who had held the title for the previous 15 years. Turner owns 2.1 million acres in the U.S. and has an additional 100,000 acres in South America
https://lowtechinstitute.org/2019/03/07/green-new-deal-how-about-a-low-tech-new-deal/
“While this plan at least acknowledges the problem of climate change and identifies the proper scale of our reaction, we can point to large gaps in the plan that must be remedied: All this construction while still limiting emissions? Who will truly profit economically from this plan? How do we pay for it?”
“The reason that this is so difficult is because we don’t want to give up our current way of life, but unfortunately our descendants won’t have much of a choice. It is up to us to give them something stable to inherit now, while we still have time to choose.”
I am afraid we cannot really fix climate change, regardless of what we spend.
The real issue is energy supplies leaving us through low prices. More debt (from any project, no matter how ridiculous) can perhaps be temporarily helpful in raising prices. I am afraid even a low tech new deal is not possible. A text only internet system would not make sense, for example. The problem is likely losing electricity, because of inability to keep up the grid as well as low prices driving electricity suppliers bankrupt.
The energy in oil gives humans the illusion we are more powerful than we really are. Because we put our foot on a plastic pedal (and push it) to move a two ton vehicle (down a fossil fuel paved road at) 70MPH makes us feel powerful and important. This leads to irrational thinking akin to: If my foot can move a 2 ton SUV 70MPH then, enough humans can push their feet to the floor we can reverse climate change, move mountains and even terra form Mars. But, in reality are rather puny. It is the fuel in the tank that does all the heavy lifting, not our foot.
it has always seemed to me, that every species must consume now, what is available now, because we have to survive now,
if we have kids we do what we can to allow them to survive now
but as the future stretches beyond grandkids, there isn’t much we can do about their ”now” because it’s too far into an unknown future—we will be long dead before they know much about what’s going on
we may not like that thought very much, but we seem to be stuck with it, unless we are prepared to stop driving, eating, flying , wasting, heating and lighting right now
which none of us seem prepared to do. even for their sakes.
oh—and reproducing—which would mean they wouldn’t get born anyway
OIL (BRENT) PRICE COMMODITY
67.64 USD +0.82 (1.23%)
Still aways from 86.74
But also aways form 49.93 ( the recent low)
We shall see—
that’s cool… just about half way between the recent high and recent low…
I still think the darkly looming massively devastating global recession will pound affordability to smithereens…
sending oil lower, even with big producers cutting production…
but, it’s a play on a stage…
a lot depends on if a black swan makes its entrance…
“a lot depends on if a black swan makes its entrance…”
Bingo!
BTW, people on this blog speculated for years and years about how the collapse would happen. Now you get to read about it as it happens in what was close to a first world country.
Fracking 2.0 Was a Financial Disaster, Will Fracking 3.0 Be Different?
By Justin Mikulka • Tuesday, March 12, 2019 –
Today, frackers are again relying on technology as a financial savior, but this time, they are looking to Microsoft.
As ExxonMobil embarks on an ambitious move into fracking in the Permian oil fields of West Texas, it has announced a partnership with Microsoft to use cloud technology to analyze oil field data and optimize operations. Exxon claims the move could generate “billions in net cash flow.”
Time will tell if the Microsoft cloud will make Exxon rain profits in the Permian.
Much like in 2017, current headlines have been touting Exxon’s plans and its partnership with Microsoft to use technology to finally figure out how to make money fracking in the Permian.
It appears to be an effective public relations push by Exxon — which was much needed. A year ago Exxon’s poor financial performance was linked to its failure to make a big move into fracking shale for oil. At the time, CNN wrote, “ExxonMobil missed the invitation to America’s big oil party.”
While this latest promise of profits from fracking now has some of the world’s largest companies behind it, these plans are nothing more than a press release at this point. Which makes this a good time to revisit when Exxon made a big move into natural gas in 2010. Exxon bought natural gas producer XTO for $40 billion, and while the U.S. is producing record amounts of natural gas in 2019, this deal is viewed as one of the worst in the history of the energy industry.
“That was one of the worst acquisitions in the history of the energy business. It was exquisitely poorly timed,” Pavel Molchanov, an energy analyst at Raymond James, told CNN in 2018. “…It was essentially $40 billion down the drain.”
https://www.desmogblog.com/2019/03/12/shale-oil-drilling-financial-disaster-fracking-3-0
ExxonMobil can hope!
“to finally figure out how to make money fracking in the Permian.”
Quite odd that these jokers couldn’t figure out that the only reason Shale and Fracking exists is because of ZIRP and the massive debt bubble that’s been getting bigger and bigger since 2008. Wall Street has to find stuff to invest in with their free money thanks to the Federal Reserve.
If people only knew what a giant Ponzi Scheme our financial world (banking+monetary+finance) their eyes would pop out like Marty Feldman. But then again those running the show prefer to distract them with sports and entertainment.
They are saying that sort of mumbo-jumbo can save farming productivity too, ‘smart’ farming……
Doom? There’s an app for that!
Anyone relying on Microsoft is delusional–
They will sone be looking at a blue screen of death.
At the time the ExxonMobil purchase took place, it seems like quite a few bloggers thought that this was a crazy idea. There are two different issues of concern (1) How many Mcf can be extracted, and (2) What price can be extracted per Mcf. Building too many wells hurts individual well performance. And natural gas prices stay low.
Who knew you didn’t need geologist, just the cloud?
Cloud technology? Really? That is just a fancy name for computers and we already use that to search for more oil. This cloud technology will certainly use oil but, it won’t find oil that isn’t there. This is just more evidence we are passing peak. We are using more and more energy to find less and less energy and resources. What comes after the cloud? Space? Do we launch space computing to search for oil? Scour the entire planet for traces of the black stuff? How much energy are we willing to burn to find more energy?
“Japan’s core private-sector machinery orders fell for a third straight month in January, the government said Wednesday, signaling companies are becoming less willing to spend in the face of China’s economic slowdown.”
https://asia.nikkei.com/Economy/Japan-s-machinery-orders-fall-5.4-in-January
“Amid worries over China’s economy, some currencies — particularly those of commodity-producing countries — will be most vulnerable to its slowdown. Experts say that two currencies stand out as being the most exposed to China: the Australian dollar and the New Zealand dollar.”
https://www.cnbc.com/2019/03/13/aussie-dollar-new-zealand-dollar-most-vulnerable-to-china-slowdown.html
“A growing number of Australians are worried about losing their jobs following soft economic growth numbers, as a slide in consumer sentiment matches the loss in business confidence and conditions… The Unemployment Expectations Index recorded an 8.9 per cent jump, indicating more consumers expect unemployment to rise in the year ahead.”
https://www.afr.com/news/economy/employment/consumer-sentiment-on-housing-lowest-on-record-westpac-mi-20190313-h1cbb2
“A growing number of workers are worried about losing their jobs due to lowering oil production”. news/economy/employment/ March 13 2022
Even if China has fewer financial ties to banks than some countries, its problems still can spread. Japan is mentioned here; other articles mention Germany being caught in the contagion.
‘A-tishoo, a-tishoo’: they all fell down….’ As in the old English nursery rhyme.
But will they rise again ?
What medicines do the CB’s, and the intellectually compromised politicians, have to offer the poor patient after a decade of QE?
Extra-Strength QE…
when the pain gets worse…
“Global debt levels have become “higher and riskier” than that of a decade ago, meaning that “another credit downturn may be inevitable”, S&P Global Ratings has warned.
“In a report entitled Next Debt Crisis: Will Liquidity Hold?, published on Tuesday (12 March), S&P found global debt has surged by around 50% since the 2008 Global Financial Crisis, led by major-economy governments and Chinese non-financial corporates, while global debt-to-GDP ratios have risen to more than 231%, compared with 208% in June 2008.”
https://www.investmenteurope.net/research/4001300/-global-credit-downturn-inevitable-debt-skyrockets?fbclid=IwAR35IuHCTTeF0N7-EA6kYc9DKVQvSt3OYN3xlpjgGzD9JcFgphjx_RcsmjI
To keep growing, we need debt to keep surging! How to do as limits are reached.
Doesn’t a giant ,rising, building wave act as an apt metaphor for rising global debt? I wonder how many financially oriented people have their finger on the pulse of this economy are in a constant state of stress wondering how long it can hold. The problem with pursuing this kind of strategy in the face of diminishing returns is there’s no going back now to a time when the economy did what it needed to by way of it’s own momentum (via surplus energy), and all waves crash sooner or later. Watch out when it crests and begins to fall.
Two things have happened to reach this point; Ever increasing growth in the economy with a need for it to continue to grow with limits in that regard already being reached, coupled with declining surplus energy. We probably hit the proverbial wall in 2008/2009 and all that stalled it to a later year was built up confidence in the economy over many decades sufficient enough to QE, very low interest rates, etc. for another decade up till now. Once the next big whammy hits there won’t be much CB ‘s can do to jolt it back into coherence and people’s confidence, faith and trust to take out big loans to start another business or buy a home will have faded into the shadows along with their jobs.
With that carefully crafted rant out of the way, I need to get back to getting something done today, i.e. work while the proverbial wave continues building.
“Theresa May is facing another potentially humiliating Brexit showdown in the Commons, just 24 hours after her latest crushing defeat. MPs will vote on ruling out a no-deal Brexit, after the prime minister was forced to concede a free vote for Conservative MPs to avoid ministerial resignations. If MPs vote against no-deal, 24 hours later they will vote on extending Article 50, which if carried would mean the UK would not leave the EU on the proposed date of March 29.
“Concluding her post-vote statement to MPs, the prime minister said: “Voting against leaving without a deal and for an extension does not solve the problems we face.
“”The EU will want to know what use we mean to make of such an extension.”
https://news.sky.com/story/brexit-crisis-another-day-and-more-humiliation-looms-for-theresa-may-11663798
“Tariffs will be cut to zero on 87% of imports to the UK as part of a temporary no-deal plan but prices of some imports including meat, shoes, underpants and cars will go up.”
https://www.theguardian.com/politics/2019/mar/13/brexit-tariffs-on-87-of-uk-imports-cut-to-zero-in-temporary-no-deal-plan
“In his speech to the European parliament Michel Barnier, the EU’s chief Brexit negotiator, also said that the risk of a no-deal Brexit had never been higher. He said:
“We are at a critical point. The risk of no-deal has never been higher. That is the risk of an exit – even by accident – by the UK from the EU in a disorderly fashion.”
“I urge you please not to under-estimate the risk or its consequences.”
https://www.theguardian.com/politics/live/2019/mar/13/brexit-mps-to-vote-on-leaving-the-eu-with-no-deal-politics-live
Sounds like a problem, both at the transition and longer-term.
Venezuela seems to be on the verge of total collapse.
https://www.wired.com/story/venezuela-power-outage-black-start/
Hey Duncan, how does it feel to have Ann Coulter sharing your views?
Trump is a ‘shallow, narcissistic, lying conman!’
https://youtu.be/mMfogdZ5-eY
The truth about Trump and politics in the USA is probably the fourth option:
“Trump is a ‘shallow, narcissistic, lying conman!”
yes, I agree! MAGA! #winning
but his personal shortcomings are immaterial in regards to his presidential obligation to protect his country by trying to minimize immigration…
Minimising immigration is a moot solution to a largely nonexistent problem at this point. His unfulfilled presidential obligation to stabilise BAU + US empire is incomparably moar significant.
Lol!
Early run as first female Republican nominee for 2020…?
You might be interested in this 2014 study. Dr. phil. des.
Adrian Hänni: How the Oil Shock Brought the World Economy Down Oil and the „Great Recession“ 2008/2009. http://aspo.ch/wp-content/uploads/2014/08/Grosse-Rezession_english.pdf
I wrote a much cited article, published in the journal Energy, on a similar topic. It can be reached at this link:
https://ourfiniteworld.com/oil-supply-limits-and-the-continuing-financial-crisis/
Lights in Venezuela on.
US Boeing stocks down.
“Venezuela has truly collapsed already,” Guaidó said in an interview with CNN on Sunday.
If you believe Guaido, I have a bridge for sale you might like.
MSM media people are clueless—
https://www.telegraph.co.uk/news/2019/03/12/dispatch-venezuelas-rich-drink-whisky-dance-blackout-cripples/
12 MARCH 2019 • 6:27PM
“A massive nationwide blackout has left only a few elite venues able to generate their own electricity.”
well, by that report, yes, there are a few lights on in VZ…
any updated reports would be greatly appreciated…
this:
https://uk.reuters.com/article/uk-venezuela-politics/venezuela-gives-u-s-diplomats-72-hours-to-leave-blames-trump-for-blackout-idUKKBN1QT25U
“Power returned to many parts of the country on Tuesday, including some areas that had not had electricity since last Thursday, according to witnesses and social media.
But power was still out in parts of the capital of Caracas and the western region near the border with Colombia.
Information Minister Jorge Rodriguez said power had been restored in the “vast majority” of the country.”
and Maduro has not yet flown to Cuba…
my sympathies to the citizens of VZ…
“Washington has taken the lead in recognising Guaido as Venezuela’s rightful president after the 35-year-old congress chief declared himself interim president in January, calling Maduro’s 2018 re-election a fraud. Most countries in Europe and Latin America have followed suit.”
Most countries in Europe and Latin America also…
Countries not recognising Guaido include Russia, China, Iran, i.e. the resistance to the globalist pro-immigration pro-choice reptilian NATO axis. Clearly Maduro is doing God’s work.
https://www.technologyreview.com/s/613092/a-quantum-experiment-suggests-theres-no-such-thing-as-objective-reality/
Hey guys, guess what, there’s no such thing as objective reality according to a quantum experiment, the results of are below. But I think we’re still in a pickle regarding diminishing returns. No way to create two realities in that case, but the following experiment did produce interesting results as far as trying to figure out the Universe.
“A quantum experiment suggests there’s no such thing as objective reality”
“They use these six entangled photons to create two alternate realities—one representing Wigner and one representing Wigner’s friend. Wigner’s friend measures the polarization of a photon and stores the result. Wigner then performs an interference measurement to determine if the measurement and the photon are in a superposition.”
“The experiment produces an unambiguous result. It turns out that both realities can coexist even though they produce irreconcilable outcomes, just as Wigner predicted.”
“That raises some fascinating questions that are forcing physicists to reconsider the nature of reality.”
Or we are unable to comprehend how things work on a really tiny level… But on the human level I’m pretty sure things are objective. Like eating objectively delicious chocolate.
A lot of history is just a mystery. “Why did that happen then?” There is a developing scholarship to connect bad weather events and wars. Here is one of them
https://www.academia.edu/38522428/Short-Term_Climatic_Catastrophes_and_the_Collapse_of_the_Liao_Dynasty_907-1125_Textual_Evidence
Seems there is an objective reason for historical events.
Interesting development
https://www.sciencemag.org/news/2019/03/new-fuel-cell-could-help-fix-renewable-energy-storage-problem
So what about the Mandela effect?
“Mandela effect”
I don’t see how this relates. Perhaps you could expand on it.
How do we know which reality we’re in? Check out “Dolly braces moonraker Mandela effect” on YouTube. One morning I woke up and spent 50 mins getting ready for work. I was just about to leave the house when I was puzzled to hear my alarm clock going off again. Next thing I knew, I was waking up again. I was furious! But I also wondered why and how my first waking had been like perfectly conscious reality and in no way dreamlike. I hear about one fellow who woke up eight times, each time getting further into the day.
Anyway, I too have the Mandela effect about a TV film, tho nobody has mentioned it that I know of. It makes me wonder now – did I wake up into the right version of reality all those years ago? When the Buddhists talk about “maya” and being in the illusion, well, I do have to wonder.
“A quantum experiment suggests there’s no such thing as objective reality”
ha!
I know as a matter of fact that I completely comprehend objective reality…
😉
I think that this hold true. I have always considered a multi-dimensional universe with realities accruing to each. A thought experiment:
Imagine that you are a 2 dimensional person and you are living on a sheet of paper. A 3 dimensional person comes along and draws a pencil line across the page. You are now fixed in your half of the paper. There is no way that you can ever know what is on the other side or even if it exists.
So we find ourselves in a 3 dimensional world (our reality) and can never experience a 4th dimension, however much we try. So maybe the monks had it right and when we die we (our consciousness) merely passes into another dimension, ie another reality
I just hope that the new reailty is nicer and more logical than the current one!
This book explains it all – if it is to be believed:
https://www.amazon.co.uk/Children-Law-Lost-Teachings-Atlantis/dp/0966001532
now i know how a dead body feels when the police draw a chalk line round it
LOL, You guys might get a laugh out of this.
Yes, it is said that you will be looking down on your lifeless body. Well that’s what some say who have reached a point of death and returned to describe their experiences. On the other hand it might just be hallucinations during the dying process. I guess I will find out soon!
“Australia’s economic slowdown is likely to become more entrenched with business conditions and confidence falling further last month. The sharp decline in business conditions and confidence late last year continues into 2019. Forward looking indicators such as orders and capacity utilisation continue to weaken…”
https://www.abc.net.au/news/2019-03-12/business-conditions-and-confidence-fall/10892224
“The value of new mortgages slipped another 2.1 per cent in January, marking Australia’s largest annual decline since the global financial crisis.”
https://www.news.com.au/finance/business/breaking-news/household-lending-dropped-24-in-january/news-story/1c59ffbd7cafbdb8b46a5d078590f42d
Economic slowdown means that there will be Austalia’s businesses and citizens will tend to buy relatively fewer goods and services in the future, or their growth will grow will more slowly. Ultimately, this is likely to be one of the factors that contributes to falling commodity prices.
Ok, so let’s see, Venezuela is teetering on collapse, Europe has minimal growth even with the formula for figuring out growth having been expanded over recent years, China is faking numbers, and although Trump is budgeting based on 3% growth – most economists think that’s too optimistic.
There’s an old saying, “As art goes so goes the economy.” That’s because when things are good people buy art, but when they aren’t, well you get the point. I frequent a location that produces statues for artists/clients, and on the latest trip there it was near bare. Not much being moved through the place and it has been gradually tapering down over the past year and a half. That’s just one location but their business serves a wide area, so we’ll see if that is a harbinger of things to come.
“Euro-area industrial production fell more than twice as much as forecast in December, raising further questions over the state of the bloc’s economy. The 0.9 percent drop — more than twice the 0.4 percent forecast — was driven by declines in capital and non-durable consumer goods production. From a year earlier, output plunged the most since 2009, when the economy was dealing with the fallout from the financial crisis.”
https://www.bloomberg.com/news/articles/2019-02-13/euro-industry-posts-biggest-annual-slump-since-financial-crisis
“Europe’s four biggest economies — Germany, France, Italy, and the UK — are close to negative growth as German industrial output dropped unexpectedly in January, which led France to outperform its larger neighbour but not replace Germany’s economic might as an engine for growth in the Eurozone.”
https://www.neweurope.eu/article/europes-four-biggest-economies-edge-towards-recession/
“Two key bond trends are nearing levels last seen during the financial crisis, signalling a recession could be on the cards.
“The spread between the 2-year and 10-year US treasury bonds, known as the yield curve, has narrowed to just 17 basis points, its lowest level since June 2007. Further declines would result in an inverted yield curve, with the 2-year bond trading higher than the 10-year bond. An inverted yield curve has preceded every recession in the past 60 years.”
https://www.businessinsider.com/us-yield-curve-and-european-bonds-are-close-to-crisis-levels-2019-3?r=US&IR=T
“Quantitative easing does not work and central banks should be prohibited from using it, Raghuram Rajan, a former chief economist at the International Monetary Fund, has said. Mr Rajan… said it was his “strong conjecture” that QE “works by depreciating the exchange rate [and] stealing demand from other countries”. In doing so, it inflames international tensions without generating growth. “I think this should be off the table,” Mr Rajan said.”
https://www.thetimes.co.uk/edition/business/central-banks-need-to-ease-up-on-qe-warns-the-man-who-anticipated-crisis-0ln7sgcw0
This is related to why MMT is a problem.
QE and MMT both generate more debt. This helps the countries that do QE (and MMT), at the expense of those who do not. It also readjusts currency relativities.
We do need more debt in total to keep the system inflated. But eventually this debt becomes an empty promise. And Ragan is right about depreciating the exchange rates and inflaming international tensions. I don’t think I would call the problem “stealing demand from other countries,” however. The extra debt creates more demand in total. If cheap energy is not available, it doesn’t really provide more supply of goods in total. So what it does is artificially make the QE (or NMMT) countries more competitive in the world marketplace. They are able to obtain more of the supply of available goods. I suppose you could call this “out-demanding” the neighbors. But I wouldn’t call it stealing demand.
Banks stop lending when they cannot make money by “borrowing short and lending long.”
“New findings from the New York Federal Reserve reveal that millennials have now racked up over US$1 trillion of debt. This troubling amount of debt, an increase of over 22% in just five years, is more than any other generation in history.”
https://www.businessinsider.com/millennials-1-trillion-debt-more-than-any-other-generation-in-history-2019-3?r=US&IR=T
“The whole world went on a corporate debt spree. What with low interest rates it was a no-brainer. In the U.S., much of that cheap money went to buying back stock to leverage earnings; a move that will look stupid when companies most need cash to survive the greatest shake-out of our lifetimes during the next several years…
“…consumer credit – cards and car loans – are up 53% [since 2009]. And a subprime auto credit crisis is rearing its ugly head, with defaults a major – and growing – concern.”
https://www.fxstreet.com/analysis/were-overdosing-on-the-debt-opioid-201903112250
Their income is also growing less than that of any previous generation, I expect. The combination means that they have a very difficult time affording to get married and have a family. Buying a home of their own is a dream for most.
“… millennials have now racked up over US$1 trillion of debt. This troubling amount of debt, an increase of over 22% in just five years, is more than any other generation in history.”
and it may never be surpassed by any future generation…
not because things might get better, but because things are guaranteed to get worse…
every generation will be poorer than the previous one (at least until there is The Collapse)…
the generations after the millennials will be poorer yet, and unable to even borrow the money that millennials were able to borrow…