The energy needs of the world’s economy seem to be easy to model. Energy consumption is measured in a variety of different ways including kilowatt hours, barrels of oil equivalent, British thermal units, kilocalories and joules. Two types of energy are equivalent if they produce the same number of units of energy, right?
For example, xkcd’s modeler Randall Munroe explains the benefit of renewable energy in the video below. He tells us that based on his model, solar, if scaled up to ridiculous levels, can provide enough renewable energy for ourselves and a half-dozen of our neighbors. Wind, if scaled up to absurd levels, can provide enough renewable energy for ourselves and a dozen of our neighbors.
There is a major catch to this analysis, however. The kinds of energy produced by wind and solar are not the kinds of energy that the economy needs. Wind and solar produce intermittent electricity available only at specific times and places. What the world economy needs is a variety of different energy types that match the energy requirements of the many devices in place in the world today. This energy needs to be transported to the right place and saved for the right time of day and the right time of year. There may even be a need to store this energy from year to year, because of possible droughts.
I think of the situation as being analogous to researchers deciding that it would be helpful or more efficient if humans could change their diets to 100% grass in the next 20 years. Grass is a form of energy product, but it is not the energy product that humans normally consume. It doesn’t seem to be toxic to humans in small quantities. It seems to grow quite well. Switching to the use of grass for food would seem to be beneficial from a CO2 perspective. The fact that humans have not evolved to eat grass is similar to the fact that the manufacturing and transport sectors of today’s economy have not developed around the use of intermittent electricity from wind and solar.
Substituting Grass for Food Might “Work,” but It Would Require Whole New Systems
If we consider other species, we find that animals with four stomachs can, in fact, live quite well on a diet of grass. These animals often have teeth that grow continuously because the silica in grass tends to wear down their teeth. If we could just get around these little details, we might be able to make the change. We would probably need to grow extra stomachs and add continuously growing teeth. Other adjustments might also be needed, such as a smaller brain. This would especially be the case if a grass-only diet is inadequate to support today’s brain growth and activity.
The problem with nearly all energy analyses today is that they use narrow boundaries. They look at only a small piece of the problem–generally the cost (or “energy cost”) of the devices themselves–and assume that this is the only cost involved in a change. In fact, researchers need to recognize that whole new systems may be required, analogous to the extra stomachs and ever-growing teeth. The issue is sometimes described as the need to have “wide boundaries” in analyses.
If the xkcd analysis netted out the indirect energy costs of the system, including energy related to all of the newly required systems, the results of the analysis would likely change considerably. The combined ability of wind and solar to power both one’s own home and those of a dozen and a half neighbors would likely disappear. Way too much of the output of the renewable system would be used to make the equivalent of extra stomachs and ever-growing teeth for the system to work. The world economy might not work as in the past, either, if the equivalent of the brain needs to be smaller.
Is “Energy Used by a Dozen of Our Neighbors” a Proper Metric?
Before I continue with my analysis of what goes wrong in modeling intermittent renewable energy, let me say a few words about the way Munroe quantifies the outcome of his energy analysis. He talks about “energy consumed by a household and a dozen of its neighbors.” We often hear news items about how many households can be served by a new electricity provider or how many households have been taken offline by a storm. The metric used by Munroe is similar. But, does it tell us what we need to know in this case?
Our economy requires energy consumption by many types of users, including governments to make roads and schools, farmers to plant crops and manufacturers to make devices of all kinds. Leaving non-residential energy consumption out of the calculation doesn’t make much sense. (Actually, we are not quite certain what Munroe has included in his calculation. His wording suggests that he included only residential energy consumption.) In the US, my analysis indicates that residential users consume only about a third of total energy.1 The rest is consumed by businesses and governments.
If we want to adjust Munroe’s indications to include energy consumed by businesses and governments, we need to divide the indicated number of residential households provided with energy by about three. Thus, instead of the units being “Energy Consumed by a Dozen of Our Neighbors,” the units would be “Energy Consumed by Four of Our Neighbors, Including Associated Energy Use by Governments and Businesses.” The apparently huge benefit provided by wind and solar becomes much smaller when we divide by three, even before any other adjustments are made.
What Might the Indirect Costs of Wind and Solar Be?
There are a number of indirect costs:
(1) Transmission costs are much higher than those of other types of electricity, but they are not charged back to wind and solar in most studies.
A 2014 study by the International Energy Agency indicates that transmission costs for wind are approximately three times the cost of transmission costs for coal or nuclear. The amount of excess costs tends to increase as intermittent renewables become a larger share of the total. Some of the reason for higher transmission costs for both wind and solar are the following:
(a) Disproportionately more lines need to be built for wind and solar because transmission lines need to be scaled to the maximum output, rather than the average output. Wind output is typically available 25% to 35% of the time; solar is typically available 10% to 25% of the time.
(b) There tend to be longer distances between where renewable energy is captured and where it is consumed, compared to traditional generation.
(c) Renewable electricity is not created in a fossil fuel power plant, with the same controls over the many aspects of grid electricity. The transmission system must therefore make corrections which would not be needed for other types of electricity.
(2) With increased long distance electricity transmission, there is a need for increased maintenance of transmission lines. If this is not performed adequately, fires are likely, especially in dry, windy areas.
There is recent evidence that inadequate maintenance of transmission lines is a major fire hazard.
In California, inadequate electricity line maintenance has led to the bankruptcy of the Northern California utility PG&E. In recent weeks, PG&E has initiated two preventative cut-offs of power, one affecting as many as two million individuals.
The Texas Wildfire Mitigation Project reports, “Power lines have caused more than 4,000 wildfires in Texas in the past three and a half years.”
Venezuela has a long distance transmission line from its major hydroelectric plant to Caracas. One of the outages experienced in that country seems to be related to fires close to this transmission line.
There are things that can be done to prevent these fires, such as burying the lines underground. Even using insulated wire, instead of ordinary transmission wire, seems to help. But any solution has a cost involved. These costs need to be recognized in modeling the indirect cost of adding a huge amount of renewables.
(3) A huge investment in charging stations will be needed, if anyone other than the very wealthy are to use electric vehicles.
Clearly, the wealthy can afford electric vehicles. They generally have garages with connections to electrical power. With this arrangement, they can easily charge a vehicle that is powered by electricity when it is convenient.
The catch is that the less wealthy often do not have similar opportunities for charging electric vehicles. They also cannot afford to spend hours waiting for their vehicles to charge. They will need inexpensive rapid-charging stations, located in many, many places, if electric vehicles are to be a suitable choice. The cost of rapid-charging will likely need to include a fee for road maintenance, since this is one of the costs that today is included in fuel prices.
(4) Intermittency adds a very substantial layer of costs.
A common belief is that intermittency can be handled by rather small changes, such as time-of-day pricing, smart grids and cutting off power to a few selected industrial customers if there isn’t enough electricity to go around. This belief is more or less true if the system is basically a fossil fuel and nuclear system, with a small percentage of renewables. The situation changes as more intermittent renewables are added.
Once more than a small percentage of solar is added to the electric grid, batteries are needed to smooth out the rapid transition that occurs at the end of the day when workers are returning home and would like to eat their dinners, even though the sun has set. There are also problems with electricity from wind cutting off during storms; batteries can help smooth out these transitions.
There are also longer-term problems. Major storms can disrupt electricity for several days, at any time of the year. For this reason, if a system is to run on renewables alone, it would be desirable to have battery backup for at least three days. In the short video below, Bill Gates expresses dismay at the idea of trying to provide a three-day battery backup for the quantity of electricity used by the city of Tokyo.
We do not at this point have nearly enough batteries to provide a three-day battery backup for the world’s electricity supply. If the world economy is to run on renewables, electricity consumption would need to rise from today’s level, making it even more difficult to store a three-day supply.
A much more difficult problem than three-day storage of electricity is the need for seasonal storage, if renewable energy is to be used to any significant extent. Figure 1 shows the seasonal pattern of energy consumption in the United States.
Figure 1. US energy consumption by month of year, based on data of the US Energy Information Administration. “All Other” is total energy, less electricity and transportation energy. It includes natural gas used for home heating. It also includes oil products used for farming, as well as fossil fuels of all kinds used for industrial purposes.
In contrast with this pattern, the production of solar energy tends to peak in June; it falls to a low level in December to February. Hydroelectric power tends to peak in spring, but its quantity is often quite variable from year to year. Wind power is quite variable, both from year to year and month to month.
Our economy cannot handle many starts and stops of electricity supply. For example, temperatures need to stay high for melting metals. Elevators should not stop between floors when the electricity stops. Refrigeration needs to continue when fresh meat is being kept cold.
There are two approaches that can be used to work around seasonal energy problems:
- Greatly overbuild the renewables-based energy system, to provide enough electricity when total energy is most needed, which tends to be in winter.
- Add a huge amount of storage, such as battery storage, to store electricity for months or even years, to mitigate the intermittency.
Either of these approaches is extremely high cost. These costs are like adding extra stomachs to the human system. They have not been included in any model to date, as far as I know. The cost of one of these approaches needs to be included in any model analyzing the costs and benefits of renewables, if there is any intention of using renewables as more than a tiny share of total energy consumption.
Figure 2 illustrates the high energy cost that can occur by adding substantial battery backup to an electrical system. In this example, the “net energy” that the system provides is essentially eliminated by the battery backup. In this analysis, Energy Return on Energy Invested (EROEI) compares energy output to energy input. It is one of many metrics used to estimate whether a device is providing adequate energy output to justify the front-end energy inputs.
Figure 2. Graham Palmer’s chart of Dynamic Energy Returned on Energy Invested from “Energy in Australia.”
The example in Figure 2 is based on the electricity usage pattern in Melbourne, Australia, which has a relatively mild climate. The example uses a combination of solar panels, batteries and diesel backup generation. Solar panels and backup batteries provide electricity for the 95% of annual electricity usage that is easiest to cover with these devices; diesel generation is used for the remaining 5%.
The Figure 2 example could be adjusted to be “renewable only” by adding significantly more batteries, a large number of solar panels, or some combination of these. These additional batteries and solar panels would be very lightly used, bringing the EROEI of the system down to an even lower level.
To date, a major reason that the electricity system has been able to avoid the costs of overbuilding or of adding major battery backup is the small share they represent of electricity production. In 2018, wind amounted to 5% of world electricity; solar amounted to 2%. As percentages of world energy supply, they represented 2% and 1% respectively.
A second reason that the electricity system has been able to avoid addressing the intermittency issue is because backup electricity providers (coal, natural gas, and nuclear) have been forced to provide backup services without adequate compensation for the value of services that they are providing. The way that this happens is by giving wind and solar the subsidy of “going first.” This practice creates a problem because backup providers have substantial fixed costs, and they often are not being adequately compensated for these fixed costs.
If there is any plan to cease using fossil fuels, all of these backup electricity providers, including nuclear, will disappear. (Nuclear also depends on fossil fuels.) Renewables will need to stand on their own. This is when the intermittency problem will become overwhelming. Fossil fuels can be stored relatively inexpensively; electricity storage costs are huge. They include both the cost of the storage system and the loss of energy that takes place when storage is used.
In fact, the underfunding issue associated with allowing intermittent renewables to go first is already becoming an overwhelming problem in a few places. Ohio has recently chosen to provide subsidies to coal and nuclear providers as a way of working around this issue. Ohio is also reducing funding for renewables.
(5) The cost of recycling wind turbines, solar panels, and batteries needs to be reflected in cost estimates.
A common assumption in energy analyses seems to be that somehow, at the end of the design lifetime of wind turbines, solar panels and batteries, all of these devices will somehow disappear at no cost. If recycling is done, the assumption is made that the cost of recycling will be less than the value of the materials made available from the recycling.
We are discovering now that recycling isn’t free. Very often, the energy cost of recycling materials is greater than the energy used in mining them fresh. This problem needs to be considered in analyzing the real cost of renewables.
(6) Renewables don’t directly substitute for many of the devices/processes we have today. This could lead to a major step-down in how the economy operates and a much longer transition.
There is a long list of things that renewables don’t substitute for. Today, we cannot make wind turbines, solar panels, or today’s hydroelectric dams without fossil fuels. This, by itself, makes it clear that the fossil fuel system will need to be maintained for at least the next twenty years.
There are many other things that we cannot make with renewables alone. Steel, fertilizer, cement and plastics are some examples that Bill Gates mentions in his video above. Asphalt and many of today’s drugs are other examples of goods that cannot be made with renewables alone. We would need to change how we live without these goods. We could not pave roads (except with stone) or build many of today’s buildings with renewables alone.
It seems likely that manufacturers would try to substitute wood for fossil fuels, but the quantity of wood available would be far too low for this purpose. The world would encounter deforestation issues within a few years.
(7) It is likely that the transition to renewables will take 50 or more years. During this time, wind and solar will act more like add-ons to the fossil fuel system than they will act like substitutes for it. This also increases costs.
In order for the fossil fuel industries to continue, a large share of their costs will need to continue. The people working in fossil fuel industries need to be paid year around, not just when electrical utilities need backup electrical power. Fossil fuels will need pipelines, refineries and trained people. Companies using fossil fuels will need to pay their debts related to existing facilities. If natural gas is used as backup for renewables, it will need reservoirs to hold natural gas for winter, besides pipelines. Even if natural gas usage is reduced by, say, 90%, its costs are likely to fall by a much smaller percentage, say 30%, because a large share of costs are fixed.
One reason that a very long transition will be needed is because there is not even a path to transition away from fossil fuels in many cases. If a change is to be made, inventions to facilitate these changes are a prerequisite. Then these inventions need to be tested in actual situations. Next, new factories are needed to make the new devices. It is likely that some way will be needed to pay existing owners for the loss of value of their existing fossil fuel powered devices; if not, there are likely to be huge debt defaults. It is only after all of these steps have taken place that the transition can actually take place.
These indirect costs lead to a huge question mark regarding whether it even makes sense to encourage the widespread use of wind and solar. Renewables can reduce CO2 emissions if they really substitute for fossil fuels in making electricity. If they are mostly high cost add-ons to the system, there is a real question: Does it even make sense to mandate a transition to wind and solar?
Do Wind and Solar Really Offer a Longer-Term Future than Fossil Fuels?
At the end of the xkcd video shown above, Munroe makes the observation that wind and solar are available indefinitely, but fossil fuel supplies are quite limited.
I agree with Munroe that fossil fuel supplies are quite limited. This occurs because energy prices do not rise high enough for us to extract very much of them. The prices of finished products made with fossil fuels need to be low enough for customers to be able to afford them. If this is not the case, purchases of discretionary goods (for example cars and smart phones) will fall. Since cars and smart phones are made with commodities, including fossil fuels, the lower “demand” for these finished goods will lead to falling prices of commodities, including oil. In fact, we seem to have experienced falling oil prices most of the time since 2008.
Figure 3. Inflation adjusted weekly average Brent Oil price, based on EIA oil spot prices and US CPI-urban inflation.
It is hard to see why renewables would last any longer than fossil fuels. If their unsubsidized cost is any higher than fossil fuels, this would be one strike against them. They are also very dependent on fossil fuels for making spare parts and for repairing transmission lines.
It is interesting that climate change modelers seem to be convinced that very high amounts of fossil fuels can be extracted in the future. The question of how much fossil fuels can really be extracted is another modeling issue that needs to be examined closely. The amount of future extraction seems to be highly dependent on how well the current economic system holds together, including the extent of globalization. Without globalization, fossil fuel extraction seems likely to decline quickly.
Do We Have Too Much Faith in Models?
The idea of using renewables certainly sounds appealing, but the name is deceiving. Most renewables, except for wood and dung, aren’t very renewable. In fact, they depend on fossil fuels.
The whole issue of whether wind and solar are worthwhile needs to be carefully analyzed. The usual hallmark of an energy product that is of substantial benefit to the economy is that its production tends to be very profitable. With these high profits, governments can tax the owners heavily. Thus, the profits can be used to aid the rest of the economy. This is one of the physical manifestations of the “net energy” that the energy product provides.
If wind and solar were really providing substantial net energy, they would not need subsidies, not even the subsidy of going first. They would be casting off profits to benefit the rest of the economy. Perhaps renewables aren’t as beneficial as many people think they are. Perhaps researchers have put too much faith in distorted models.
Note:
[1] This is my estimate, based on EIA and BP data. With respect to electricity, EIA data shows that in the US, residential users consume about 38% of the total. With respect to fuels that are not used for transportation and not used for electricity, US residential users consume about 19% of these fuels. Combining these two categories, US households use about 31% of non-transportation fuels.
With respect to transportation fuels, the closest approximation we can get is by looking at petroleum use, divided between gasoline and other products. According to BP data, on a worldwide basis, 26% of petroleum is burned as gasoline. In the United States, about 46% of petroleum consumption is burned as gasoline. Of course, some of this gasoline usage is for non-residential use. For example, cars used by police and sales representatives are typically powered by gasoline, as are small trucks used by businesses.
Furthermore, the US is a major importer of manufactured goods from China and other parts of the world. The embodied energy in these imported goods never gets into US energy consumption statistics. In theory, we should add a little energy consumption by foreign manufacturers to supplement total reported US energy consumption.
The selection of “about a third” is based on these considerations.
In WWI the state failed to supply the population because the shortages underminded the reliability of the state officials. When the farmer would grow popatoes and the soldier control him the latter would offer to look apart when the farmer sells potatoes on the black market in order to get some potatoes for himself. This is a structural consequence of shortage. The consequence in WWI was, that the state lost its legitimacy which led to national independence.
When shortages of energy occur weather from climate activism or production shortages or affordability it will activate the same consequence. The state will be seen as failed state and people will look for alternate boundaries. These will naturally be egoistic, people who know each other, who can accept some kind of narrative to form a social group will exclude outsiders and reduce their shortages on the account of others.
This is why a Green New Deal can never work. Obviously energy reductions will lead to shortages. Shortages will lead to a disintegration of the state. This is a vicious cycle which will undermine the regulation suggested in all ideas of GND or New Large Transformation 2.0 or Energy modellings of UN and EU.
The experience of WWI shows that shortages themselves will the state’s ability to accommodate needings of their society members and thus loose legitimation and stability.
The consequence is that all technology depending on the state will be diminished. The failure of the states will also effect knowledge transfer, military, infrastructure and inner security.
It may be discussed if the effect of shortage is also part of the dissolution of the Soviet Union and it may be a reason for the recent developments in the USA and the European Union and perhaps in the Middle East.
Jan, excellent post, thanks.
Yes, you are right that the state becomes less and less effective with less resources.
A lesson to this effect we can usefully learn from history is the story of Zenobia of Palmyra, who tried to save first Syria, and then most of the East, from the foundering Roman Empire. She failed, of course, but the rather more astute Constantine succeeded some 50 years later.
At least something is growing exponentially in China: the number of bankruptcies.
https://pbs.twimg.com/media/EIv4_PrWoAAiXr4?format=jpg&name=medium
“Income inequality in America is the highest in decades, and the highest of all high-income countries. It’s also growing rapidly—meaning that, as the saying goes, the rich are becoming richer and the poor poorer…
“…evidence highlighted by the study suggests that inflation is much higher for people at the lower end of the income scale.”
https://qz.com/1742839/inflation-inequality-is-making-americas-poor-even-poorer/
“More millennials in the United States are suffering from chronic health problems, potentially restraining the lifetime economic potential of a generation.
“A jump in conditions such as depression, hypertension and high cholesterol among younger people could increase healthcare costs and lower incomes in coming years…”
https://www.latimes.com/business/story/2019-11-06/millennials-health-problems-raise-economic-concerns
Another example, perhaps, of self-limiting natural processes: poor prospects, you lose hope and die all the sooner.
I rather suspect that other factors will be ‘limiting their economic potential’, though….
Listening to parents and health authorities doesn’t seem to come high on their agendas either, especially if things are generally going badly. Processed, ready to eat foods are cheap and take virtually no time to prepare.
Sad when boiling a pot of potatoes is over head Forget bread making
I remember the issue of inflation affecting the poor more was raised at the time of the 2008-2009 recession. It was the subprime mortgages that failed early on. The people with these were disproportionately poor.
“Income inequality in America is the highest in decades, and the highest of all high-income countries. It’s also growing rapidly…”
All you have to do is look at incentive and ideology. The Republican party has an ideology the wealthy should not have to support through social programs or taxation the lower classes. They get their campaign money (incentive) from the rich and help them out, like the last tax cut which predominantly went to top earners. People with that ideology can argue that’s a good thing, but it increases inequality. McConnell & the R’s want to dramatically scale back social security and medicare, which is next if the R’s control all three houses after the 2020 election, or the world economy collapses, whichever comes first.
I’m actually of the opinion now, that the sooner it all comes crashing down the better. Why, because human behavior is out of control. We just put our foot down on the accelerator of resource depletion and population increase and give lip service to conservation and population control. And those with the gold rule, i.e. the golden rule, meaning greed is also out of control. The current set up needs to be shut down, a die off occur and those making it through the bottleneck need to ascend to a higher consciousness level, more in tune with each other’s needs and in balance with the planet.
“ascend to a higher consciousness level”
As someone who has studied low technology people, I find this unlikely in the extreme.
Keith, I invite you to attend my online course on “Attaining Gaia Consciousness” at a 15% discount. That is a mere USD 25,500, or 51 cows if you happen to be Fulani. And you will not only achieve an exalted personal cosmic awareness, you will understand that mere money is inhibiting your spiritual evolution.
Enlightenedly yours, Guru Robert. PS: we accept all major credit cards.
With regards to myself, personally, I prefer later; for you if sooner is your wish, be my guest.
Just returned from the farm, it is cold out there, south of Rochester much corn is in the field, snow here which means corn has snow on it, that falls on the the silk, snow melts in the combine, plugs it up, very fast. How these guys are going to get that corn harvested is an issue. Now, try and feed your self on the land, even if you have the equipment. Looking at videos, observing my tenant, it takes a family of three men doing the heavy lifting along with casual laborers and one woman cooking meals; some hot, home cooked food served on a cart tread or farm office seems to make the day lighter. A few children to help out are useful as well if for nothing else there is hope that all the work will have a future as well as a present.
That is a vastly different life from what most have now. It takes a group, you will have to form a group, and I think it might take a family; a family to survive has to learn to forgive other members, overlook the issues a see the positives. This is much different from our current public life.
Bottleneck: men sacrifice themselves routinely, is it possible that the bottleneck was one of mankind’s greatest hours, the men sacrificed themselves, a new order arouse and here we are? Mother nature seems to be very male in how she does some things; not a lot of tolerance for what does not work.
Chrome, the odds are this difficult period we are going to go through by probability alone will affect each of us; I grow to love the land, but it is cold now, much work was not done because the weather did not cooperate, next season the fields need to be planted again, they need preparation, the work will be continuous, the season shortened and if there is a crash, the food bin will be empty, filling it could be a challenge. Most will not go quietly but will wish to eat. We don’t live in the abstract world of OFW.
Dennis L.
The plight of the contemporary farmer as you describe it is genuine.
However, the model itself evolving up (malforming) to this sorry state of point is failed though. Part of biomes could/should be rearranged for no-till, animals feeding mostly on agroforestry patterns as much as possible, no-few offsite inputs etc..
Is it going to feed with such leverage current level of pop (also the issue domestic vs. internationally), no way (plus the needed ~2decades transition period), but some form of mixed city-farmer tapestry kind of civ is indeed possible to achieve, we have been there in the past.
That would be a good model, and one able to weather better the storms which are coming. If we had any capacity for foresight and even mid-term planning, that is what we would be developing. Historically, in Europe, many cities had farms and orchards within the walls.
It’s notable that plans for ‘Green’ new towns here are strong on solar panels, but do not address food supply and heavy transport issues at all.
This city, Cambridge, could have been surrounded by new market gardens – fields come almost into the city centre on one side, where I live – and the exhausted farmland revived and restored, mixed farms started to replace mono-culture, with new hedgerows, copses, fishponds, orchards, etc.
This would have provided both employment for the less -skilled, and a buffer against international food shortages.
Instead we have ‘Eddington’, a new town with a phoney and empty ‘market square’, which is just the same old mass of concrete and steel, with a few panels on top and some bike racks.
Its sole purpose is to enable the University to compete internationally for graduate students (read Chinese) and tech company investment, by providing high density accommodation. The rest is just Greenwashing, and it is very ugly indeed into the bargain!
All central government seeks from new developments in a region is an increased tax yield, it is their sole yardstick for success.
Something seems to change as we “progress.”
“This would have provided both employment for the less -skilled, and a buffer against international food shortages. ” There are not many people willing to do this job.
It is commonly reported among those who have worked the land that the body gives out around fifty or so years, worn to the bone so to speak. It is hard to get people top go into the metaphorical coal mines now.
Social note: Somewhere I picked up the idea that men routinely sacrifice themselves for their families, community, nations etc.; a corollary is you generally cannot pay a man enough to voluntarily give up his own life yet he will sacrifice it on a battlefield in return for a ribbon. Hard work wears out the body but then so does idleness.
These are observations only, no solutions, no opinions; it is a time of change and we are passing through that time.
Dennis L.
Good points: yes, generally the body was wrecked by farm work, but much of that was due to being out in all weathers with no adequate clothing – here in England, there was only a sack over your shoulders if it rained! And many lacked even that.
A richer shepherd might save up to buy a raincoat and cloak, or be given one by a good master, but not a mere labourer. Rheumatism inevitable……
I think market gardeners though would be quite well off, and the work not too heavy. However, the physical state of many is poor these days, and to do such work you have to be habituated to it. Even ‘gym-fit’ is not farm-fit: a very different use of the muscles.
I read an interview with a stone mason who repairs the great cathedrals here: he was a mess physically, even with the use of power lifting machinery, etc. Back, knees, hands, all over-strained over 40 years of work.
Thanks for the pointer. I checked out Eddington online and yes, it is repulsive. I also found a house in the “Athena” complex, a three bedroom house at GBP 850,000. That is insane. But I suppose all those exorbitant fees the Chinese students pay must be spent on something.
yep, people in the US are getting shorter, fatter and dumber.
https://www.newyorker.com/magazine/2004/04/05/the-height-gap
Poor nutrition, TV, easily distracted with ADD.
I watched lots of TV as a kid, but ample books were on hand, too, and paper, paints and crayons, wood and cardboard, etc – real stuff to use.
But this being glued to glowing screens is something of quite a different order in its psychological effects, and the way it influences mental, social and physical development.
Height gap started as early as 1955, according to the article.
“Cheapening money to incentivize economic activity is no longer working. European central banks in particular are out of ideas to jump-start economic activity. The near negative and declining interest rates in developed countries around the world have caused the dollar to soar, which has a knock-on effect in developing countries like Indonesia, Turkey and Nigeria that have borrowed heavily in dollars and must repay them from earnings in local currencies that have steadily devalued.
“Negative rates have a mal-effect on consumers and savers, though “real rates,” which account for inflation, are what they ultimately feel. Cheaper money does not necessarily filter down to the consumer at a retail level. Banks with interest-rate shortfalls in a world of near or actual negative rates will charge their customers higher fees for any service, whether overdrafts or use of out-of-network ATMs.
“Savers, in particular older people who rely on interest income receive nominal payments for saving, and struggle to make ends meet. About 25 percent of Europeans and 30 percent of Japanese are aged 60 or older. More alarming, pension funds – historically conservative investors – struggle to meet benchmarks of 7 to 8 percent returns, a common threshold for solvency, so shortfalls are emerging.
“The big test may be if the United States as the world’s largest economy tries negative rates. Allianz Economist Mohamed El-rian said recently, negative yields in the world’ largest financial market would “break things.” By break, he means a systemic failure or bank collapse.”
https://yaleglobal.yale.edu/content/global-economy-struggles-negative-rates
“This year’s flood of monetary easing is slowing to a trickle as the world’s central banks judge they’ve done enough to avoid a recession, giving investors cause to think sovereign bond yields have finally bottomed.
“Federal Reserve Chairman Jerome Powell last week said policy had reached an “appropriate” level after three cuts in interest rates this year. Mounting criticism of the European Central Bank’s negative rates leaves its new president, Christine Lagarde, under pressure to hold fire on additional stimulus, and Bank of Japan Governor Haruhiko Kuroda may be even closer to the limits of monetary policy.”
https://www.bloomberg.com/news/articles/2019-11-06/central-banks-hitting-peak-dovishness-prick-bond-market-bubble
“The weakest economic growth since the global financial crisis is fuelling speculation the Reserve Bank of Australia will join its global peers and kick-start quantitative easing.”
https://www.bloomberg.com/news/articles/2019-11-06/qe-debate-in-australia-has-bond-traders-watching-for-these-signs
How QE really works
https://www.zerohedge.com/s3/files/inline-images/how%20qe%20works%20in%20practice.jpg?itok=3994DpPy
The big problem is that without more QE, interest rates tend to rise as governments continue to overspend their income. This tends to prick the debt bubble and cause huge financial problems.
A decade ago, retired people who had enjoyed even modest wages, but saved very hard over a lifetime of work -perhaps also having been wiped out in the 1970’s – were able to receive quite decent amounts of interest on their savings, and dividends on shareholdings; sounds rather like a fairy tale now, doesn’t it?
This will feed through into smaller or zero inheritances for their children and grandchildren, further weakening financial resilience as we all decline into destitution or a precarious livelihood.
another part of the economic endgame in which IC now finds itself…
there’s a lose/lose scenario where the average person has no savings or has some savings that pays zero or close to zero interest…
in this endgame, there seems to be no potential for higher interest rates… it’s going to be near zero or negative from here on out…
companies, desperate to stay afloat, will be decreasing pension/retirement benefits to zero, and throwing the burden entirely onto the finances of workers, who will find that their wages will be stretched thinner and thinner as increasing numbers of workers will be living from paycheck to paycheck., and therefore will have no means to fund personal retirement accounts…
younger adults are already finding that buying a house is more out of reach than previous generations, and the loss of equity in that home ownership will contribute to the downsizing of inheritances over the next decades…
it’s all grinding down, slowly, very slowly…
the only remedy for this creeping economic decay would be a fast collapse…
take your pick…
A fair summary.
A slow, but inexorable, general collapse, and some very quick personal ones, is what is in store – if we are lucky!
All companies will charge as much as they can, tie people in to nearly impossible to escape contracts, and cut the quality of mass goods to the bone.
money does nothing for consumers, they will be squeezed all the more as conditions worsen.
Expensive goods still seem to be maintaining quality, as far as I can see; but their customers would not tolerate any reduction in quality.
A ‘crappified’ world, and therefore one which created even more land-fill waste.
That’s ‘cheap money’ .
“Europe needs to come up with emergency plans, since monetary policy has all but exhausted its arsenal and risks spread, the IMF warned.
“Given elevated downside risks, contingency plans should be at the ready for implementation,” the IMF said in its Regional Economic Outlook for Europe. “A synchronized fiscal response” may be necessary, the fund said in the report, highlighting the dangers from trade protectionism, a chaotic Brexit and geopolitics.”
https://www.bloomberg.com/news/articles/2019-11-06/europe-warned-to-prepare-for-the-worst-as-imf-sees-clouds-darken
“The former head of the ECB, Mario Draghi, repeatedly called on euro zone countries to add fiscal support to stoke growth, saying because monetary policy could only do so much, and Wednesday’s readings suggest additional support may be needed….
“”We expect growth to slow across the board,” said Melanie Debono at Capital Economics.”
https://www.reuters.com/article/us-eurozone-economy-pmi/euro-zone-economy-at-risk-of-contracting-in-the-fourth-quarter-pmi-shows-idUSKBN1XG190
“German industrial output fell more than expected in September, data showed on Thursday, pointing to ongoing weakness in the sector and indicating that Europe’s largest economy will slip into recession in the third quarter… Industrial output dropped by 0.6% on the month…
““It’s not a nice number. The decline in industrial production in September makes a technical recession almost official now,” said Thomas Gitzel, economist at VP Bank.”
https://uk.reuters.com/article/uk-germany-economy-industrialoutput/decline-in-german-industrial-output-adds-to-recession-fears-idUKKBN1XH0UQ
“A slowdown in global car sales and the threat of U.S. tariffs are curbing economic expansion in eastern Europe, a critical manufacturer for Europe’s auto industry.”
https://www.bloomberg.com/news/articles/2019-11-06/slowdown-in-global-car-sales-weighs-on-eu-s-eastern-economies
Everyone wants to manufacture at least the cars for its own economy. Hence, the tariffs. This way, jobs and the local economy is helped.
“WILLIAMS SAYS FED WOULD ADDRESS NEXT RECESSION BY CUTTING INTEREST RATES TO ZERO AND USING COMMUNICATION AND ASSET PURCHASES”
They are already doing it.
“WILLIAMS SAYS MONETARY POLICY DOES HAVE SOME LIMITATIONS SO IT WOULD BE NICE TO HAVE FISCAL POLICY ALIGNED WHEN ADDRESSING DOWNTURNS”
One trillion dollar deficits are not enough?
under Obama, the US deficit rose $8 trillion in 8 years…
I think Trump has done 3+ in 3 years…
so $1 trillion per year is just coasting along, nothing special, not out of the ordinary…
QE (stealth or not) can add many trillions per year…
who is kidding who?
We follow Japan’s lead.
Notice empty store fronts on the city Boulevard where I live..?
Though, the Kitty Shack, beyond my expectations, still holds on!
So far in 2019, there have already been 48% more store closings announced than in all of 2018, according to a recent report from global marketing research firm Coresight Research.
Based on Coresight Research’s figures, retailers’ earnings reports, bankruptcy filings and other records, more than 8,600 stores are slated to shutter this year and thousands of locations already gone.
Dressbarn store closings: Liquidation starts Nov. 1 at all locations, new website planned
Forever 21 store closings: 100-plus stores will close as part of bankruptcy. See the list
Bankrupt footwear company Payless ShoeSource, which closed its remaining U.S. stores in late June, accounts for about 37% of the closings.
The “going-out-of-business” sales and liquidation of other brands is expected to continue. Coresight estimates closures could reach 12,000 by the end of the year, the report said.
Coresight, which has offices in Manhattan, London and Hong Kong, tracked the 5,864 closings in 2018, which included all Toys R Us stores and hundreds of Kmart and Sears locations.
https://finance.yahoo.com/news/more-store-closings-coming-estimated-100014142.html
When I was a young lad with my first real job managed a local Auto Parts Wholesale/Retail store.
Not a bad gig, had a great sales staff and nice neighborhood customers that I knew by name.
Went out of my way to be there when needed and get what they wanted, when put of stock.
Don’t know about today with the internet and mega chain stores. It would be a tuff environment.
My 10% discount to all regular repeat customers wouldn’t cut the mustard…..P.S. I kept what was left of the 90%…the home office never question that promotion!🤑
The sugar-high from Trump’s tax cuts wearing off?
“American workers were unexpectedly less productive during the third quarter, with growth in their output failing to keep up with hours worked… nonfarm productivity, which measures hourly output per worker, fell at a 0.3% annualized rate between July and September, the biggest decline in almost four years…
“The decline might set back the prospects of a pick-up expected by some economists in the trend growth rate for productivity following 2017 tax law changes partially aimed at fostering investment.”
https://uk.reuters.com/article/us-usa-economy-productivity/u-s-productivity-drops-by-most-since-fourth-quarter-2015-idUKKBN1XG1ZM
Right! But workers need jobs too. The economy is staying afloat (to the extent this is happening) by the higher wages of workers and the fact that employment isn’t falling.
It is not clear that adding investment in capital at this point really is really helpful. Too much of the gain goes to the top 1%. It acts too much like adding robots, pushing the buying power of the economy down, rather than up. The benefits of investments need to flow back to the wages of workers.
https://www.washingtonpost.com/us-policy/2019/10/31/white-house-officials-ramp-up-new-tax-cut-talks-trump-seeks-sharp-contrast-with-democrats/
As of just 6 days ago, Trump is pushing hard for yet another tax cut, a sugar high at the expense of increasing debt, intended to garner votes in 2020.
It’s interesting that politicians running for office are not allowed to give away gifts to potential voters before the election, however they can promise the Moon to voters if elected. And what’s the difference – before or after. It still amounts to gift/s.
When the Slovak government needed more money in the last years, it introduced special taxes for the regulated monopolies and banks, insurance companies. E. g. it introduced a special contribution for banks to the state budget in the height of 0.2 % of the value of their liabilities shown on their balance sheets. For the next year, this special contribution is raised to 0.4 %.
https://ekonomika.sme.sk/c/22253334/vlada-schvalila-dvojnasobny-odvod-pre-banky.html?ref=trz
They find organizations that have money and aren’t in a position to move away. The problem with taxing billionaires is that they pick up and leave.
Gail, once again spot on. When governments need to extract money, they target both those who can move, who do, weakening the economy, and those who cannot, who therefore pay the taxes, weakening the economy.
I remember a meeting in Whitehall, where there was a discussion on how to deal with “abusive tax shelters”. I was a little guy in the back row, but got to make one comment: “Perhaps you should begin by getting rid of the abusive taxes.” This was not a popular comment.
Collateral economic damage from protests, which are themselves rooted in economic discontents:
“Iraq’s massive protest movement is having its first direct effects on the country’s oil output, as production is now curtailed at the Qayarah field.”
https://www.iraqoilreport.com/news/protests-force-first-oil-field-shut-in-42233/
“Whether they sell luxury watches from Switzerland or farm hens from Mississippi, a surprising concern is occupying a number of corporate executives this earnings season: Hong Kong’s protests…
“The far-reaching impact of the protests speaks to the outsized role that Hong Kong has hitherto played as a thoroughfare for Chinese shoppers. Buyers have flocked to the city for its zero consumption tax and variety of global imports, whether luxury handbags or infant formula.”
https://finance.yahoo.com/news/companies-around-world-hit-hong-210000877.html
“A million salmon are starving or rotting in abandoned farms and processing plants in Chile, the world’s second-largest producer of the fish, as protests prevent workers from accessing facilities.”
https://www.bloomberg.com/news/articles/2019-11-05/a-million-salmon-starve-and-rot-as-protests-block-chile-farms
India core 8 industries are tanking.
https://pbs.twimg.com/media/EIqd_Y3X0AMCYn-?format=jpg&name=small
Protests and riots across India would be too much for the global economy is the protests paralyzed India.
Someone said that China allows posting of police violence against protesters in HK on social media as a warning to mainland Chinese of what to expect if they should protest.
I looked up the eight core industries in India. They are electricity, steel, refinery products, crude oil, coal, cement, natural gas, and fertilizers.
I would agree. If these industries are tanking, there is a huge problem.
India is not remotely survivable, if one is even paying minor attention.
But I believe Pakistan will be over the falls first.
But I have been wrong before.
A lead news item from two days ago. India’s capital, Delhi, is experiencing unprecedented level of pollution. The level had climbed to 400, and that is not even the worst case: some cities have pollution levels of 450. And at that level, children who go outside will die.
The government’s response? Not to tackle the polluting industries, nor even the major pollution caused by burning crop waste (some 35 million tons annually) No: they decree that cars can use the roads only on alternate days, based on their number plates. And how is that to be enforced? By a seriously undermanned and badly underpaid police force?
I recall expressing the opinion a while ago that India’s most sensible economic action would be to shut down their car industry. Won’t happen, and people will continue to die. Duncan, I fear you are right; a combination of religion, greed, incompetence, and corruption will doom India. A sad end to the inheritor of one of the world’s great civilisations.
Vehicle sales in India are down, however. https://www.marklines.com/en/statistics/flash_sales/salesfig_india_2019
For the month of September, 2019, Commercial Vehicle sales are down 39.1% from a year ago. Private Passenger Auto sales are down 23.7%.
The corresponding August, 2019 reductions are Commercial vehicles down 38.7%; passenger vehicles down 31.6%
July is almost as bad: Commercial vehicles down 25.7%; passenger vehicles down 31.0%.
They seem almost to be shutting down their vehicle sales.
Interesting graph, will they also blame this on the trade war?
The key thing is that Hong Kong’s economy was already slowing before the riots broke out. This is the kind of reaction that can be expected.
https://gailtheactuary.files.wordpress.com/2019/11/hong-kongs-was-alrady-slowing-down-bloomberg.png
China’s real GDP is perhaps close to Hong Kong’s?
My confidence in published GDP amounts keeps falling.
And indeed mine. Amazing how often nations escape technical recessions by posting 0.2% growth or similar in the Q after a negative reading (thinking of UK and Singapore recently).
We *know* India’s and China’s GDP’s are dodgy because even some key officials have admitted as much, and, come on, is a nation like South Africa really growing at over 3% when they can barely keep the lights on?!
Didn’t some countries introduce estimated proceeds from crime, drug and hookers, etc, in their GDP?
Even that now has to be viewed with reserve, as I see that, in Britain at least, the price of drugs has fallen significantly, leading to war between the gangs for a share of the shrinking pie.
Falling demand yet again: all the signals are bad, it seems…..
Yes, indeed, Xabier. Apparently it is quite widespread:
“A European Union (EU) policy mandating that member states take untaxed “shadow economies” into account when calculating economic output comes into effect this month [Sept. 2014]…
“The average EU country was estimated to have a shadow economy equal to 18.8 percent of its GDP in 2013, according to the economist Friedrich Schneider. The EU country with the largest estimated shadow economy as a percentage of its GDP is Bulgaria, at 31.2 percent, followed by Romania and Croatia at 28.4 percent each. The United States, in comparison, is estimated to have a shadow economy equal to 6.6 percent of its GDP…
“Adjustments for shadow economies are made by non-EU countries as well. The largest adjustment worldwide, according to the Institute of Economic Affairs, is a 24.3 percent adjustment made by Russia, whereas the smallest is that made by the United States, which only adjusts by 0.8 percent.”
https://www.occrp.org/en/27-ccwatch/cc-watch-briefs/2616-eu-countries-to-begin-counting-drugs-prostitution-in-economic-growth
Then, of course, comes the “Purchasing Power Parity” PPP weighting scheme that is used in calculating published world GDP figures. The country with the highest PPP weighted GDP is China. These are 2018 GDP amounts in PPP$.
China $22.5 trillion
United States $18.2 trillion
India $9.2 trillion
Japan $5.0 trillion
Germany $3.8 trillion
Russia $3.8 trillion
Indonesia $3.1 trillion
Brazil $3.0 trillion
The EU in total comes in at $19.5 trillion
If the World Bank expects the least developed countries to grow most quickly, this is an approach that heavily weights these countries. I expect that quite a few of these GDP amounts are overstated as well.
“slowing before the riots broke out”
That’s to be expected. By the evolutionary psychology model, a poor economy is the cause of riots and related social disruption.
I suspect the Chinese government understands this.
not sure look at Midland texas…. Low unemployment even at $30 a barrel of oil. Maybe this can go on forever….https://www.cnn.com/2019/11/06/business/midland-texas-boomtown/index.html
Maybe oil prices don’t have to go much higher after all…
I don’t know either. Midland is close to New Mexico. Perhaps that helps. New Mexico rig counts are doing well: 108 this week compared to 102 a year ago.
Neither Texas rig counts nor Permian Basin rig counts are doing well. (Permian is in both Texas and New Mexico. Texas has other basins besides the Permian) Texas Rig counts are 416, compared to 533 a year ago. Permian Rig Counts are 416 compared to 487 a year ago.
Of maybe the reduction of rig counts is still leaving a lot of other workers. I would expect that the rig operators move around a lot. They are hired from companies like Halliburton and Schlumberger. They may not affect the local unemployment rate.
“Chesapeake Energy helped pioneer America’s shale natural gas revolution. Now, the company is warning that it may not survive the era of cheap gas it helped to usher in.
“The Oklahoma-based energy company said Tuesday in a filing to the Securities and Exchange Commission that if “depressed prices persist,” there is “substantial doubt” about its ability to continue as a “going concern.””
https://edition.cnn.com/2019/11/05/investing/chesapeake-energy-debt-going-concern-natural-gas/index.html
““Signs of stress have appeared in the global economy, and the outlook for global growth, at least in the short- and medium-term, has been revised down repeatedly over the past year,” OPEC said in its World Oil Outlook.
“The group said it would likely cut production of crude and other products to 32.8 million barrels per day by 2024, down from 35 million barrels per day in 2019.”
https://www.cfo.com/the-economy/2019/11/opec-cuts-demand-forecasts/
The way that peak oil arrives is through low prices. US peak oil in 1970 arrived this way, in fact.
We know that peak coal has arrived in many places. It comes with rising costs of production and prices that remain too low for profitablity. The situation is not any different for oil, as far as I can see.
If demand (really “affordability of finished products made with oil”) is high enough, oil prices can rise, and output can rise.
The link also says,
I’m not an accountant, even though both my parents were, but even to me it seems that cutting production by 30%, and expenses by 20%, is unlikely to improve the bottom line.
In science, it’s called “hysteresis”. Revenue is much more volatile than expenditure, so over engineered, over complex, and slow moving organisations are desperately vulnerable to market fluctuations.
I wonder what price oil will drop to in the next recession and its implications on the oil industry. If it dropped to $35 for an extended time, surely that would drive a stake through many smaller struggling oil & service companies.
And nations.
not that I have a crystal ball but…
I predict oil will average under $50 in 2020 and then under $40 in 2021…
wild ash guess, who knows, could soar…
but my highly subjective interpretation of 2019 economic news suggests that down is the probable direction…
“Something weird happened in September, for reasons that remain a little murky. The repurchase agreement or “repo” market seized up.
“I’ll spare you a plumbing lesson; all you need to know is that repos are really, really important for overnight funding.
“Without them, it’s very hard for banks, brokers, funds, and other market participants to square their books. Modern banking simply wouldn’t function and the system would shut down.
“Now, this wasn’t a catastrophe. The Fed injected some liquidity and everything seems okay for now. The important part is that it shouldn’t have happened and worse, apparently no one saw it coming.
“We had a string of similar hiccups in 2007–2008. All were manageable but eventually they added up to something much worse. So, this wasn’t a good sign for market stability.
That’s the problem with unconventional monetary policy. It may solve your immediate problem but create bigger ones later… the Fed looks rattled and a rattled Fed is not what we need.”
https://www.forbes.com/sites/johnmauldin/2019/11/05/modern-central-banking-is-more-vulnerable-than-we-think/#789084e476d1
“…the Federal Open Market Committee’s summary of economic projections in September 2018 showed all its members calling for no interest-rate cuts in 2019. Instead they have cut rates three times this year.
“So why should we believe the Fed can protect the market against a sell-off in stocks and bonds when it is implying both are at risk of happening so it gave us three rate cuts and a $1trillion repo liquidity infusion?”
https://www.marketwatch.com/story/despite-the-feds-support-this-stock-market-is-headed-lower-2019-11-05
““Euphoric” U.S. equity futures positioning among asset managers is nearing July 2019, September 2018 and January 2019 peaks that are in line with highs seen just before the global financial crisis. That means stocks could be vulnerable to bad news… Earnings forecasts for 2020 are too high… Stocks are already accounting for the benefits of a phase one trade deal…”
https://www.marketwatch.com/story/euphoric-investors-trigger-alarm-bells-over-stock-market-rally-2019-11-05
“Those who assume the recent inversion – and reversal – in the U.S. Treasury yield curve are foreshadowing an oncoming recession might be missing the point, said Jeffrey Kleintop, senior vice president, chief global investment strategist at Charles Schwab.
“Instead, the steady decline in long-term rates speaks to pessimism about the prospects for the global economy, Kleintop told advisors…”
https://www.fa-mag.com/news/schwab-s-kleintop–the-global-economy-is-on-shaky-ground-52588.html
Long term interest rates do indeed seem to reflect expectations about the future of the world economy. The last time things seem to have been this bad seems to be around the time of the Depression of the 1930s.
But if there is nothing else to invest in, and interest rates are close to zero, incredibly high evaluations seem to be possible. Sort of a “1.0 / 0.0” situation.
The author makes a good point about the continued rise in stock markets being the result of the cheap to negative interest rates abroad, allowing multinational companies to buy back their stock at low or even negative interest rates.
One critical paragraph in this report, regarding her view of the future:
This is where the author sees everything going wrong. However, it seems to me that the US would use QE to buy up the debt itself, before it would let interest rates rise. Also, the US economy would be in such bad shape from crashing debt elsewhere, the higher interest rates on US debt would be just one part of our problems. In some sense, interest rates can’t really rise, because there aren’t enough goods and services to divide up. I guess the question is, “Where do things go wrong?”
Higher interest rates for even certain classes of debt will bring the economy down. I expect this will happen before interest rates on US debt rise a lot. Or am I missing something.
Heating up the kettle:
“I am convinced that since mid-September 2019 major banks have been trying to use the situation in the US to put pressure on the supervisory authority and on the Fed to lower the ratio of liquidity that is demanded to face most real systemic hazards. Indeed since the 2008 crisis, the supervisory authorities have demanded that systemic banks keep more liquidity compared with what was the case before 2008, to be able to deal with an accident.”
From this article:
https://www.globalresearch.ca/federal-reserve-panic-september-2019-solutions-crisis/5693700
Global auto production just keeps falling with no bottom in sight.
https://www.zerohedge.com/economics/recession-auto-industry-tanking-global-economy
These are the charts shown:
https://gailtheactuary.files.wordpress.com/2019/11/car-sales-by-month-ft-imf.png
Wow! Recent WSJ numbers also pointed to a recent fall off.
Also this one:
https://gailtheactuary.files.wordpress.com/2019/11/slump-in-car-sales-by-part-of-the-world-imf-ft.png
Chesapeake issues a warning about default if prices remain depressed.
https://pbs.twimg.com/media/EInawhjW4AAG5io?format=png&name=medium
Just poor judgement….what’s 6 billion among friends? Plenty of more coming down the pipe to patch things up….just a double click away! Then, off to the clubhouse for a bite to eat and a round of golf!
SoftBank Reveals $6.5 Billion Loss From Uber, WeWork Turmoil
(Bloomberg) — Masayoshi Son is finally disclosing the damage from SoftBank Group Corp.’s bets on WeWork and Uber Technologies Inc.
The Japanese investment powerhouse on Wednesday reported its first quarterly operating loss in 14 years — about $6.5 billion –after writing down the value of a string of marquee investments. It swallowed a charge of 497.7 billion yen ($4.6 billion) for WeWork, whose spectacular implosion turned the once high-flying shared-office startup into a Silicon Valley punchline.
The losses call into question the billionaire founder Son’s deal-making approach just as he’s trying to raise an even larger successor to his $100 billion Vision Fund. The investment vehicle had been a driver of profit growth at SoftBank, contributing over $14 billion in mostly paper gains over the past two years. Now, the shrinking valuation of Uber and WeWork, once among the brightest stars in the SoftBank constellation, raises the prospects of more writedowns in the Vision Fund’s portfolio with its high exposure to businesses that prioritize growth over profitability.
On Wednesday, SoftBank’s chairman took some blame for his poor decisions. “There was a problem with my own judgment, that’s something I have to reflect on,” said an unusually somber Son
No wonder US profits of companies are down. It doesn’t take a lot of results like these to bring overall profits down.
A minor observation. If we exclude from the calculation companies that have never made a profit, such as WeWork, Uber, Tesla, or Chesapeake Energy, company profits are going up. The problem is that these fraudulent shell companies are increasing in number, fuelled by fools with a lot of easy money, thanks to the even worse fools who try to run the world economy.
Don’t Worry, Be HaPpY
https://news.yahoo.com/trump-administration-schedules-lease-sale-225011678.html
Yereth Rosen
ANCHORAGE, Alaska (Reuters) – The Trump administration said on Tuesday it will be auctioning off nearly 4 million acres (1.6 million hectares) of land in Arctic Alaska for oil development next month, and it is promising much more territory will be open to development in the future.
The Bureau of Land Management (BLM) announced that its annual oil and gas lease sale in the National Petroleum Reserve in Alaska will be held on Dec. 11. The sale will be the 15th in a series of oil lease sales held by the BLM for that region on the western side of Alaska’s North Slope.
The BLM is also finishing up a draft plan to overturn Obama-era protections that put about half of the 23 million-acre (9.3 million-hectare) reserve off limits to oil development, citing needs to protect caribou, migratory birds and other resources important to the region’s indigenous people and to the nation.
The Trump administration and the oil industry argue the Obama plan is too restrictive and needs to be replaced.
“With advancements in drilling technology, it was prudent to develop a new plan that provides for greater economic development of our resources while still providing protections for important resources, such as subsistence uses,” Chad Padgett, BLM’s Alaska state director, said in a statement.
The reserve, which lies well to the west of the legacy Prudhoe Bay and Kuparuk oil fields, was undeveloped for decades.
Several recent discoveries have sparked a westward expansion of oil development on the North Slope, and the petroleum reserve – the largest single U.S. federal land unit – is seen as a promising region for new Alaska oil production
Yes, yes, please run for re-election and WIN..the PeRfEcT President for BAU Full Throttle!
At current oil prices, it is difficult to see that bidders will be willing to pay much. December 11 is not far away. We will have to wait and see.
The Iran marriage crisis:
https://youtu.be/Vaafty1YK6M
Interesting! The government has set up a matchmaking office. And there are many women who work for no compensation, working as matchmakers. There are forms to fill out.
On the government website, no photos are allowed. Parents are expected to meet the other person on the first date.
The children are considered to be an investment of the parents, so, logically, they must approve the marriage.
It is clear that the declining income or property of the young is a problem that makes the marriage impossible.
In the US, it seems to be the instability of the jobs that makes marriage a problem. If a person works only on a contract basis, or doesn’t know when this job will end and he will have to find another one, it makes it hard to plan. If there are two adults in the household, keeping the jobs near each other is often difficult, without one taking a big payout. Historically, it seems like men moved for their jobs; wives took whatever kind of low paying jobs they could find. But now, it seems to be rare to have an employer move a couple and their children across the country for a new position. The couple gets stuck with the expenses of moving.
the gig economy is taking us back, in the absolute sense, to the hiring fairs of the middle ages (and later)
That is a good definition: “the instability of the jobs”. The jobs are often performed in a hurry, yesterday was late, there is a need of various follow-ups, additional repairs, corrections etc. The resulting wages are mostly not satisfactory, so loans or savings are needed to bridge the times without the income.
On the other hand, according to Iranian friends, there’s lots of Free Love going on openly a these days, at least in Teheran; so if not marrying they are, at long last, having some fun and a more normal life – at least the urban middle-class are, not the lower classes who are still bound by religion and that ridiculous oppressive dress code.
What is “normal life” when the population starts to shrink and the ageing population requires caregivers? I do not see a fun in that.
Ugo Bardi has a new book out, called “Before the Collapse: A Guide to the Other Side of Growth,” published by Springer.
According to a Facebook post by Ugo,
.
So far, there are no reviews up on Amazon about the book.
It is not expensive, compared to most Springer books ($29.99). But I scratch my head. What in the world? This book reminds me of some of Richard Heinberg’s books. The first one to come up on the Amazon’s listing for Richard Heinberg is, Our Renewable Future: Laying the Path for One Hundred Percent Clean Energy by Richard Heinberg and David Fridley June 2, 2016.
Perhaps this is the way to make money. “How to profit from our upcoming problems.”
Perpetual energy comes to mind.
With fusion I often wonder if the real problem is physics as we understand it; fusion seems to work well on a large scale, the problem is stars are hard to confine in magnetic containers. Maybe it doesn’t work on small scales, even a dwarf star is a handful on a lab bench.
Dennis L.
You don’t need a mini-star or magnetic confinement to make fusion work. All you need is directed velocity impact, like in a particle accelerator. See: http://www.fusionenergysolutions.net
Dear Doom, nobody doubts that this process “works” in the sense of causing fusion to occur. The problem is (still) that it takes much more energy to create the fusion than is released by it. The slideshow you reference makes two claims: secondly, that a particle accelerator can create fusion (true), and first, that this requires no input power. In other words, it is proposing a perpetual motion machine of the first kind.
I’m not about to sell my investments in a machine to extract sunlight from cucumbers.
No, there is energy being consumed. However, DeLuze is claiming net energy out. I’ll ask him to provide a detailed response.
Dear Doom, check out the slide at 5:00 in. It claims that the particle accelerator needs no current, and hence no energy input. But accelerated charged particles ARE current, are they not? So they consume power, and that slide is pure obfuscation.
James DeLuze says: Dear Doom and Robert Firth. Sorry for misleading wording, for there is minuscule, insignificant current and power consumption. So low my concern is being able to see it during operation of my 2kW prototype to get actual power gain measurements. Fusion is driven solely by force, voltage with electric fields. Magnetic fields are in proportion to current. With DC particle acceleration, voltage is across resistive plasma and the resultant unidirectional movement of charged particles is a net current. With AC acceleration, voltage is across a capacitance, within which the charged particles oscillate. One direction is a positive current, with the other being a negative current. The net current cancels to zero.
The current insignificance can be understood by considering the very small capacitive reactance with consideration of the very high DC resistance of the circuit approximating 6 E15 ohms. This will calculate to a phase shift of 90 degrees to at least 10 significant figures. When the phase shift is 90 degrees, the power function (current times voltage) is a sign wave at twice the frequency centered on the x axis. It’s average is exactly zero. I’m not claiming perpetual motion, but very high power gain.
Dear Doom, Thank you, and please thank James DeLuze on my behalf, for a long, detailed, thoughtful, and most professional response. I note that he concedes the slides were a little unclear, and in turn I therefore withdraw the objections in my previous posts. His explanation is far beyond my skills at mental arithmetic, so please allow me time for the consideration he deserves. The only small gap I see in his post is that there is no discussion of the magnetic fields his apparatus will create. Does that have a negative impact on the accuracy of the accelerated particles? This was a consideration that kept the Tokamak people awake at nights, as they explained to me during my visit to CERN many years ago.
But by the way, to maintain a pi/2 phase shift with that degree of accuracy is indeed an impressive feat.
James DeLuze says: Thank you Mr. Firth for your kind response. My intent in the slides was to present the idea as simply as possible. Attempting to explain apparent, real, and reactive power (and resistance) to laypeople is beyond my expertise. I’m also not a mathematician, and I find AC circuit calculations very difficult. But AC capacitive reactance provides a good “electrical trick” to separate the issues of force from power. With DC power “comes along” due to the unidirectional motion of the charge carriers, though only the force (voltage) provides the electric field that drives fusion. Like pushing against a wall (force applied) that does not move, therefore no work (force acting thru distance) done or power expended. This is a huge advantage over magnetic confinement, for the magnetic field is in proportion to current (the distance component in electricity). I know my explanation was simplistic and incomplete, but the point is that power consumed approaches zero by not using parameters directly driving fusion: ie high voltage with insignificant, minuscule current; thus high power gain. It’s also like wave motion or hydraulic fluid in a break line. What is moving is the force impulse. Through the time domain of electrical rotation, the movement of the charges approximates zero. The magnetic fields anticipated are small, since only the fuel ions are in motion, therefore oscillatory current minimized. I do not at this time believe magnetic fields will interfere, but with the Lawrence Berkley DC reactor there was concern from secondary electron emission due to ion target impact. A small magnet was placed in the target to alleviate this issue. At this time, since this reactor cycles through repetitive sequences, I believe secondary electrons will cancel out through each cycle. But there are many other things that keep me awake at night.
Dear Doom and James DeLuze
My brain hurts. However, the basic physics seems to be sound. Your remark that a force multiplied by zero distance requires no energy is of course correct. But your apparatus seems rather more subtle: the force does indeed move a small distance, but the ensuing reaction moves it back, allowing the energy to be recovered on the recoil.
That this will indeed move your fusion candidates together is a claim of which I am less certain, but a contour integration around the system cycle certainly does not refute it. (If memory serves, it was Paul Dirac who taught me that.)
But one problem did drop out: that pi/2 phase shift is critical to the apparatus, but it is metastable. If it drifts even a little, it will suffer an exponential departure from the mean, and I doubt the consequences would be manageable. Given the very short time frame in which these events occur, I suspect you will have a major problem keeping everything on its small island of stability.
But, on balance, you may have my provisional support for your innovation. And thank you both for a most interesting conversation.
a minor point to add to this discussion: if you create a high voltage, you will consume energy maintaining it. it can be a comparatively small amount, but it takes electronic drives to make it, consuming finite energy amounts. then there are all the ancillary electronics to sense, monitor the processes going on. nothing is completely “free”.
Everybody wants and needs a positive and uplifting expectation for the future. Nobody wants to hear or read doom and gloom. If we suggest that we are heading for global collapse with sharp population decline, no cars or electricity, and a lot less food, then we can’t tell the future. If we suggest that we are on the cusp of a renewable energy revolution with electric flying cars and times of plenty for all with endless growth and colonies on Mars, then we are absolutely right to the point of stating the obvious.
The likes of Ugo Bardi and Richard Heinberg are writing what people feel a need to read, probably as much as they are writing something with which they seek to allay their own concerns.
And there were a lot of academics who put together narrow EROEI analyses that seemed to suggest that wind and solar might work as substitutes, because they might produce enough “net energy.” Plus we have Jacobson and others with models of how wind, water and solar might work. If a person puts all of the wishful thinking together, a person can get a story that people want to hear.
“can get a story”
Right. But at *some* low enough energy cost, renewables will work. That’s assuming that the cost of power reflects the cost to produce it (i.e., the invested energy in the PV plant).
Of course, you have to do something to make the energy storable–either convert it to a liquid or store it in a battery.
We use a surprising amount of coal as coal. It needs to be pretty cheap to beat this. This is a chart I made using some world IEA data, showing what type of organization is the first use of coal. In this case, the price to beat is the price of coal (not electricity made from coal).
https://gailtheactuary.files.wordpress.com/2019/07/how-world-coal-is-used-2016-iea.png
“price of coal”
At one point, back when I was first talking about power satellites on The Oil Drum, I had the cost of coal at my fingertips. It was around $70/ton in those days. There is about 7 bbl of oil to the ton, so $50/bbl oil would be about $350/ton. That makes synthetic oil about 7 times more expensive than coal on a ton basis, somewhat less on an energy basis because of the hydrogen. But there is no use of coal I can think of that cannot be done other ways. For example, blast furnaces are widely replaced with direct reduced iron, which is then fed to arc furnaces.
BTW, the closest the US has to the Sasol plant is here: https://en.wikipedia.org/wiki/Dakota_Gasification_Company
There are uses of coal that would be hard to replace. It’s used in the big electrodes used for making steel in an arc furnace. But it is a small use, so does not impact the CO2 buildup.
Keith:
When I look up “Direct reduced iron,” I find the following: https://www.metallics.org/dri.html
Also https://www.metallics.org/dri-production.html
Carbon monoxide and hydrogen are hardly things that we can easily produce with limited quantities of burned biomass.
Also
“Carbon monoxide and hydrogen . . . burned biomass”
We probably would not bother with CO since hydrogen works just fine. As to getting it, I have been talking about a buildout of solar farms and F/T plants up to 100 million bbl/day. The amount needed to make all the iron we use is tiny in comparison.
Not saying it will be done, but it looks like it is possible.
Timing is critical as well.
“Timing is critical”
Agreed. There are at least ten years of FF left though. I am far from certain that anyone will start making carbon-neutral fuel, but they could.
The people who run the Palo Verdi Nuclear Generation station are thinking of making hydrogen in the fall and spring. https://www.mysanantonio.com/news/texas/article/Future-of-Arizona-nuclear-plant-may-see-hydrogen-14804430.php
Turning the hydrogen into hydrocarbons would be a way to store the energy or they could use it to fuel the utility trucks. Depending on how they value excess power, the fuel could be rather inexpensive.
I am not sure what the side effects would be of covering something like 1/35th of the Saraha desert with black PV to make 100 million bbls a day. It would cost some number like $1.3 T per year for ten years to put this much structure in place.
I need to rework the numbers and have someone else check them.
There are only ten years of fossil fuels left if the prices stay high enough. Peak oilers have a great deal of faith that prices will stay high enough. In fact, they believe the system will stay together, allowing us to extract the fossil fuels that seem to be easily available. I am not convinced that the system will stay together long enough, with high enough prices, for this to happen.
” I am not convinced”
Neither am I. But if the engineering and economics work out, then maybe the first synfuel plant comes online perhaps 4-5 years from now. After about 5 years at a high construction rate, renewable PV would be supplying half what is being pumped out of the ground. Another 5 years could see natural oil completely displaced.
Not at all saying this will happen. It will take a considerable time for the idea to spread out and be checked. And there is the question of 1.69 cents/kWh being real. The people I know in that business are scratching their heads trying to figure out how they did it.
But the scheme is a way that *might* meet your quite reasonable objections to renewables by making something easy to handle and store.
Keith, we know renewables will work, because from the Mycenae of Agamemnon to the Austria of Maria Theresa, renewables were all we had. And they were good enough not just for survival, but for civilisations that were the envy of the world. The trouble is that nobody knows how to go back, to climb down the ladder that leads only to doom; and with very few exceptions, nobody cares.
We don’t have a big supply of abacuses, for example, or of clay tablets. Farmers don’t know how to farm without metal tools. We don’t have trained draft animals. We have no way to mill grain without electricity or fossil fuels.
People have believed the idea that wind, water and solar are all we need to replace fossil fuels. They are not even renewable–they don’t grow on trees or otherwise reproduce.
For Gail: some of us do retain these skills. i have seen Chinese shopkeepers in Singapore use the abacus. I have seen farmers here in Gozo harrow the soil with wooden tools, and build drystone walls with mallet, chisel, and muscles. And Heage windmill is a modern working flour mill driven entirely by the wind. Most of the skills we would need are still there, somewhere, and it would not need all that many itinerant Master Craftsmen to make them more widespread. After all, that is how the great cathedrals of Europe were built over a thousand years ago.
Yep. Nobody cares. You can’t get proper understanding or consensus over the simplest things. I guess our system manufactures ignorant individualism. Another vexing problem is that all the many care about is people. It’s like total mania. Nobody cares about the place–the soil, the land, the old buildings, the trees.
Gail, I fear the more absurd analyses were based not on energy but on money: MROMI. Equipment built cheaply in countries with almost slave labour, no environmental controls, and minimal quality assurance. The windmills (for instance) would then pay for the cost of construction and generate a profit. Of course, even this was a fraud, because it underestimated, or even ignored, the cost of the infrastructure needed to erect them and connect them to the grid, the cost of longer term maintenance, and the cost of decommissioning.
That is why I spent some lazy evenings doing my own EROEI, with the conclusion that these innovations, over their entire life cycle, were an energy sink.
And of course, these investments with nearly slave labor and no concern about pollution compete with local production and jobs, pushing the system toward a crash.
Very insightful.
“Nobody wants to hear or read doom and gloom.”
Well doom and gloom is what you percieve when you read OFW. It’s a logical feature of the facts that are confronting us humans. You have to be honest with yourself and others. Heinberg and Bardi cannot do that. They’re both in denial, and are perhaps ethically challenged.
Ugo Bardi couldn’t afford to live in the nice big house his parents built and now lives more or less in a cellar, a half-underground apartment; his son had to leave Italy to find work, and his daughter is unemployed with poor prospects – not much fun at all. He’s a nice chap, but often writes nonsense about renewables for those reasons I think – the overwhelmingly depressing reality of a sharply declining Italy. We all cope as best as we can…..
I have had many meals with Ugo over the years when both of us spoke at the same conferences. So I feel like I know him. I know he has always been very optimistic, so I shouldn’t be surprised.
His daughter if she is attractive would have to marry.
“His daughter if she is attractive would have to marry.”
The main means of upward mobility for women since marriage replaced sex slavery. A preeminent milestone in the progress of mankind, which the invaders of Western Europe are currently reversing.
Thank you, Curt. As it happens, I do have a positive and uplifting expectation for the future, but for the future of this Island Earth and the manifold creatures that inhabit it.
“O LORD, how manifold are thy works! in wisdom hast thou made them all: the earth is full of thy riches.” (Ps civ:24)
I believe that Gaia will survive this sixth extinction, and become once again an abode of life, and life more abundant. And that this will be a future far better than any of our contrivance.
Agreed! We are not in charge of creating a proper outcome. All of the articles we read suggest that we have far more power over self-organizing systems than we really do. They pound a story of sin and guilt into our heads: We aren’t doing enough to prevent climate change. If only we would recycle more, things would be better.
We aren’t really in charge of this system. I keep saying that there seems to be a literal power behind this self-organizing system. What happens is ultimately determined by the system, not ourselves.
But I’m not seeing where we can separate ourselves from the larger system. We may well be a malignant part of the system, however. A whole lot of the problem I see is that we separate ourselves and put ourselves so far above all else (and are indeed so influential) that we can’t see the forest for the trees.
Profiting from collapse? That sounds fantastic for collapsing societies. Just what we need.
“How to profit from our upcoming problems.”
That’s the way according to Cory Morningstar:
The manufacturing of Greta Thunberg
I remember an analysis done for Lloyds of London on the expected Peak Oil problem, done years ago. It was done for the insurance industry. A big part of the story seemed to be, “How you can profit from Peak Oil.” Climate change can be viewed the same way. More revenue, if insured natural events can be shown to increase and premiums for these events can be raised.
Many people have profited from climate change, or at least the climate change movement. Al Gore, for one, who bought a waterfront property in Montecito for almost nine million dollars. (An issue I raised earlier for which I was called a liar). And the climate change activists, who attended the recent summit in Palermo courtesy of 114 private jets.
The Charles Mackay recipe for becoming very rich, as effective now as in 1841.
I think Greta Thunberg is almost completely wrong, but at least she walks the walk, rather than just talking the talk. And in an age of almost universal hypocrisy, living up to ones beliefs is an act of exemplary moral courage. Dominus tecum, puella nobilissima.
“Greta Thunberg”
I have not paid a lot of attention to Greta. I wonder how deep her understanding of physics is?
What is there to understand? The science is settled. Not up for discussion.
“The science is settled.”
That may be the case, but there is no widely recognized approach to get off using fossil fuels. In the last few weeks, a couple of news stories and some old technology fell together into what might be a solution.
The question is if Greta has the background to understand it. And would she put out a positive message?
“Our Renewable Future” by Heinberg and Fridley really isn’t very optimistic. The book is free to read at https://ourrenewablefuture.org – have a look and see what you think.
There is a new plan to solve California’s electricity problems. According to the WSJ, California Mayors Join Campaign to Buy Out PG&E
This is a plan that sounds interesting. The group will almost certainly have to face up to the real cost of its high cost of operation. Then the situation will be like a homeowners’ association that has no choice but to pay the large bills that are coming due, or cut back services to members.
Yup, but each year someone will propose that a transformer can last one more year to delay increasing costs, or someone cannot pay their share and it is not fair they do with less than their fair share of electricity. Different boss, same as the old boss.
Dennis L.
The devil is whispering to me to spread around the idea that utility rates ought to be lower for People of Color and other disadvantaged groups.
Dennis, right on, as usual. The main cause of the fires is not the utility, who admittedly made some bad decisions. It is the refusal of the state government to face environmental reality. They actively encouraged, and continue to encourage, two huge pervasive mistakes. The first is their refusal to take precautions against forest fires, by clearing brush, creating firebreaks, and similar obvious measures. The second is their crazy policy of allowing anyone to build in areas of extreme fire hazard, because that is growth, and growth is good. And now homes that should never have been built are burning to ashes, and the solution … keep doing it, but with even more oppressive, and more incompetent, bureaucratic control.
Again (putting on the same old 78rpm record), classical economics would have solved at least the second problem. Insurance companies would have refused coverage for homes in fire hazard areas, and so such homes would not have been built, unless fire management was put in place first. But in the world of socialised economics, everybody is “entitled” to insurance, no matter how stupid their behaviour.
The school system in Italy is forced to accept another green propaganda:
Exclusive: Italy to make climate change study compulsory in schools
https://www.reuters.com/article/us-climate-change-italy-exclusive/exclusive-italy-to-make-climate-change-study-compulsory-in-schools-idUSKBN1XF1E1
“ROME (Reuters) – Italy will next year become the world’s first country to make it compulsory for schoolchildren to study climate change and sustainable development, Education Minister Lorenzo Fioramonti said.”
It is no wonder, that, during the last decades, the Italian cabinets last only a few months… Just another funny idea that, with a very high probability, will be cancelled by the next cabinet.
On the flip side….
The Science is based on basic Physics and Chemistry; backed up by decades on ongoing research, data and record collecting, on the ground observations and paleoclimatology. The IPCC, which represents the world Scientific Community, supports such in it’s conclusions. Unfortunately, there will always be a segment of those that will refuse to accept reality and currently it’s those that run society. Behind closed doors, they themselves privately must think otherwise, but can’t let go of profiting from business as usual. Sad state of affairs. Perhaps a teenager may change that, the Science and the Scientists could not.
Yes, I wrote this….and I agree, MG, there is no Green solution, but that does change the Science and the academic evidence.
The sad state of affairs is that the model in the IPCC report uses a combination of what we think of as science and what we think of as economics. The science part may indeed be correct. The economics part is most definitely wrong. In fact, the economics part misses the point that physics requires energy to operate the economy. Thus, the economics part makes a serious science error. The so-called scientists are not aware enough of the physics part of the problem that they only look at their part of the story. They endorse the output of an incredibly poor model that fails because of physics errors that they never considered important enough to look at.
Well, Gail what can I write? Oh, here is something…
Despite 40 years of major global negotiations, we have generally conducted business as usual and are essentially failing to address this crisis,” said William Ripple, a professor of ecology at Oregon State University and co-lead author of the paper. “Climate change has arrived and is accelerating faster than many scientists expected.”
And there it is, Everyone and Anyone has their stance. Personally, I’m done “debating” on this topic because, frankly, it’s rather a thankless task. I learned from past experience.
I disagree with your statement regarding Science and the term “so-called Scientists”.
That still does not alter the vast body of evidence nor natural laws.
Economics is another matter, having taken a graduate level course in Public Economics and foolishly pointing out perhaps minimizing would be optimal rather than maximizing.
Did not go over too well on the topic of Business as Usual😁.
Thanks for your opinion, and realize this blog tends to point to and will try to refrain further comment.
The IPCC material had many reviewers. But over 80% of them were not climate scientist, who were outnumbered even by social scientists. Some 60% of the reviewers’ comments were dismissed without explanation.
Of the supposed hundreds of reviewers, exactly ONE reviewed everything, Nobel laureate Vincent Gray. The following direct quote is his considered conclusion, after seventeen years as a reviewer.
“I have been forced to the conclusion that for significant parts of the work of the IPCC, the data collection and scientific methods employed are unsound. Resistance to all efforts to try and discuss or rectify these problems has convinced me that normal scientific procedures are not only rejected by the IPCC, but that this practice is endemic, and was part of the organization from the very beginning. I therefore consider that the IPCC is fundamentally corrupt. The only ‘reform’ I could envisage, would be its abolition….Yes, we have to face it. The whole process is a swindle, The IPCC from the beginning was given the license to use whatever methods would be necessary to provide ‘evidence’ that carbon dioxide increases are harming the climate, even if this involves manipulation of dubious data and using peoples’ opinions instead of science to ‘prove’ their case…. The disappearance of the IPCC in disgrace is not only desirable but inevitable….Sooner or later all of us will come to realize that this organization, and the thinking behind it, is phony. Unfortunately severe economic damage is likely to be done by its influence before that happens.”
Thanks for the quote. I found this related web page. https://meteo.lcd.lu/globalwarming/Gray/support_for_call_for_review_10Oct07.html
Thank you, Gail. It amplifies substantially the quote I found. His remarks on “average temperatures” were amusing. One obvious problem is that the average is computed as the arithmetic mean of lowest and highest. But the graph of temperature against time is not a straight line, so this procedure cannot be correct.
An even more amusing example comes from Canada, which had temperature sensors covering almost all of the country. Until the government ordered about one third of them turned off: the northern third. Overnight, Canada became the latest victim of global warming.
However, it seems the entire thesis is about to be put to the test; the unimpeachable test of Nature. We are entering another Grand Solar Minimum. The last one (1790 to 1830) created a 2C overall drop in temperature in the first 20 years. If the same happens again, the planet will be cooler than it was in 1850.
«Nobel laureate Vincent Gray»?
The IPCC doesn’t carry out scientific research.
Capitalizing “the Science”, “Scientists”, “Scientific Community”, “Physics”, “Chemistry” and “Green” is reminiscent of practice of the One True Church, whose members capitalize “God”, “the Virgin Mary”, “”the Holy Trinity”—also known as the Father, Son and Holy Ghost”, etc.
Our Holy Roman Church has traditionally be held by orthodox practitioners to be infallible. Practitioners of science (which is not capitalized unless it begins a sentence), by contrast, have always held science to be fallible, a candle in the dark, a tribute to what we can know although we are fallible, the belief in the ignorance of the experts, etc.
When people capitalize common nouns to the extent you have done above—to emphasize how special or important or sacred these nouns are—they are signaling loudly and clearly that they are members of a church, a sect or a cult.
Let’s not forget that the IPCC was chaired Rajendra Pachauri for over a decade, a man who stated without irony that “For me, the protection of Planet Earth… is more than a mission. It is my religion.”
https://wattsupwiththat.files.wordpress.com/2015/02/pachauri-bishop-ipcc.gif?w=720
Italian cabinets last such a short time so that the career politicians can pick up extra perks and pensions. Passing through every revolving door, something sticks….. They aren’t really that incompetent. 🙂
Nicely summed up…
“… compulsory for schoolchildren to study climate change and sustainable development…”
please do not miss the more abbsurd part about “sustainable development”…
no modern development is sustainable, but of course I’m just stating the obvious…
Exactly: ‘sustainable’ is a word which has been so cynically abused by developers, corporations, and governments that it has become empty of meaning, which is a shame.
A few solar panels, heat pumps and some fancy bike racks don’t make a huge pile of steel, concrete and tarmac dumped on a field – as happens here – ‘sustainable’.
We are just lying to ourselves. The reality is too awful, too daunting I suppose.
And there is continuing profit in the lies – ‘development’ can go on just as before, only now ‘Green’ and ‘clean’…..
Funny if it weren’t a tragedy.
Exactly. Add a little recycling for perfect pseudo-sustainability.
Well, yes, sustainable development would be propaganda, but not climate change.
The models for climate change assume continuous development.
Are you saying continuous development is explicit in the climate models? Can you point to some reference which shows that? As I understand them, they are simply modelling how the climate reacts to certain physical stimuli.Scenarios plugged in try to tease out how different emissions trajectories will affect the climate.
The physical stimuli include a whole lot of fossil fuels burned. You have to have the world economy growing a whole lot, pretty much continuously, to get all of these fossil fuels burned. The story that the world economy can continue to grow to use the expected amount of fossil fuels until 2100 is absurd, in my opinion.
I don’t think that the modelers are taking into account the problems the world has with coal that burns underground, but which we can never get at to stop. This would be a problem, with or without coal extraction. In fact, it would be a problem, with or without people on earth.
The models don’t include this assumption. They are modelling the effect of injected CO2 (from fossil fuel burning, currently) but the amounts and rates are injected as external inputs to the model, with various runs of the model taking varying inputs.
I agree, though, that some of the assumptions in the scenarios are absurd. However, I also used to think that it was absurd that the world could produce any more than about 90 million barrels per day or that increases could continue for much longer than the conventional peak.
That’s the problem with the future, it’s difficult to predict.
You cannot really separate the model from the assumptions. Certainly, the end users cannot.
If we look back historically, we can see that a lot of civilizations have collapsed. This model is simply using absurd assumptions to scare people regarding what might happen 80 years from now. Another purpose seems to be to distract them from the real problems we have today, with too little affordable fossil fuels, rather than too much. A third purpose is to try to extract funding from the rich countries, to help out the countries whose emissions have, in fact, been exploding. This explosion has gotten worse since China joined the World Trade Organization in 2001. (CIS is the Former Soviet Union countries.)
https://gailtheactuary.files.wordpress.com/2019/11/co2-emissions-by-part-of-the-world.png
But it isn’t the model that has those assumptions, it’s the projections of future fossil fuel use that are fed into the models.
Climate change and other environmental issues are also real problems. Are you suggesting that we ignore some of our serious problems in order to concentrate on a few of them that some may deem more urgent? Why can’t we look at all of our serious real problems?
Our biggest problem is population. The actions chosen to supposedly mitigate our CO2 problems have simply made our world population problem much worse. The fact that the UN is a “do good” organization, helping the poor, very much biases the outcomes of how climate change will be addressed, making certain that energy increases will be given to those whose populations are likely to grow most. China, with its one-child policy, has managed to somewhat cap the impact.
Giving more energy supplies to less well off nations effectively means helping their populations to continue to soar, making an even bigger CO2 problem for the world later. It also makes a huge migration problem. Asking for handouts from the high income countries to the low income countries adds to mitigate CO2 is likely to add to this effect.
Drawing attention to climate problems, when it is doubtful that the model is correct, and it is even more doubtful that we can do much of anything about the emissions, is a real problem. In fact, if what we do is counterproductive, in terms of the model, the result is just plain silly.
https://gailtheactuary.files.wordpress.com/2019/11/population-by-part-of-the-world.png
“continuous development”
I am not certain about the technical or economic details yet, but a preliminary look at combining low-cost PV, the recently announced MIT CO2 capture system, and old F/T technology produce some interesting numbers that indicate it might be possible to get off fossil fuels entirely.
Not sure why schoolchildren studying climate change is green propaganda.
We do not know what are the turning points. The heating up of the planet has its limits also. Maybe the scientists miss this fact.
There are always limits in nature. I’m not sure why that would be an argument for not teaching climate change in schools.
How about teaching the limits of fossil fuel extraction first? Also, the limits of water supply?
How about teaching what life would be like without fossil fuels? Start with the power outages in California, and then take away all of the stuff people have, for example.
By all means teach what fossil fuels have enabled and how life would change when they are finally gone. But that is not climate change.
https://gailtheactuary.files.wordpress.com/2011/08/10-population-expand-greatly.png
Exactly!
Obviously, under “c. ch.”, they usually mean some kind of reversal we can achieve easily slashing down some indicators like CO2, which is not true.
Since it is very unlikely the school kids will be learning about how climate is constantly changing and that it is not changing now any more than it always has and it is not all going to end in the next twelve years and it is not all our fault, it probably will be taught as green propaganda.
Having said that, studying almost anything at school has been propaganda of one kind or another for some time now. The problem is we can’t afford to let the kids grow up into savages or non-conformists or even eccentrics, so we can’t have them educating themselves. Indeed, we need to fill their little heads with something in order to make them us, to socialize them in a non-Bernie Sanders way.
Upon accepting the New York City Teacher of the Year Award on January 31, 1990, John Taylor Gatto upset many in attendance by stating: “The truth is that schools don’t really teach anything except how to obey orders. This is a great mystery to me because thousands of humane, caring people work in schools as teachers and aides and administrators, but the abstract logic of the institution overwhelms their individual contributions.” A generation ago, the problem of compulsory schooling as a vehicle for an authoritarian society was widely discussed, but as this problem has gotten worse, it is seldom discussed.
The nature of most classrooms, regardless of the subject matter, socializes students to be passive and directed by others, to follow orders, to take seriously the rewards and punishments of authorities, to pretend to care about things they don’t care about, and that they are impotent to affect their situation. A teacher can lecture about democracy, but schools are essentially undemocratic places, and so democracy is not what is instilled in students. Jonathan Kozol in The Night Is Dark and I Am Far from Home focused on how school breaks us from courageous actions. Kozol explains how our schools teach us a kind of “inert concern” in which “caring”—in and of itself and without risking the consequences of actual action—is considered “ethical.” School teaches us that we are “moral and mature” if we politely assert our concerns, but the essence of school—its demand for compliance—teaches us not to act in a friction-causing manner.
https://highexistence.com/8-reasons-young-americans-dont-fight-back-us-crushed-youth-resistance-2/
The IPCC is a joint project of the United Nations’ Environment Program and the World Meteorological Organization. It was created in 1988 largely due to the efforts of Maurice Strong, a socialist with considerable interest in redistributing funds from richer countries to poorer countries. Quadrant online posted this unflattering view of Mr. Strong.
http://quadrant.org.au/opinion/doomed-planet/2010/01/discovering-maurice-strong/
From what I have seen, the UN, in general, seems to be set up from a point of view of aiding small, poor countries. It should not be surprising that the result of the IPCCs efforts are to produce conclusions along these lines.
The International Energy Agency (IEA), which is an organization of OECD, disseminates energy-related views about what countries should do in response to climate change. The IEA writes report after report telling countries that they should add more wind, solar, and hydroelectric, and cut back on fossil fuels. (OECD and IEA are both headquartered in the same building in Paris. OECD was set up to counter OPEC.)
I heard years ago that the IEA is also the organization that gives the IPCC the absurdly high estimates of future fossil fuel extraction. (Someone outside of meteorology would have to do this. The IEA would be a reasonable first guess as to which organization would do this, since they are the only international energy organization.) These high estimates pretty much guarantee that the forecast future temperatures will be high, given that the model seems to consider CO2 and other warming gases above everything else in forecasting future temperatures.
To some extent, the IPCC has also used Peak Oil fossil fuel estimates to provide a lower end of the fossil fuel range. But even these are likely quite high, because Peak Oilers don’t consider the possibility of low prices and collapse.
This isn’t true; the models try to incorporate all aspects that are known about. The fact that CO2 seems to be the largest driver is because that’s what the science is telling us.
Regarding the UN favouring small poor countries, well I’m not sure about that. The big countries have far more influence than smaller countries. In any case, I don’t know why small poor countries getting some help would be so controversial.
In the Ordovician, CO2 levels were around 4400 parts per million, or about 10 times higher than today. The Earth was no warmer than today; indeed, the Late Ordovician was an ice age.
The truth is, there is no one “biggest” factor in any climate. The system is holistic, and the parameters interact. A theory that selects one “dominant” factor, and then imposes a near linear relationship between it and climate, is not just incomplete; it is totally wrong.
There is for current climate change. That is what the science is telling us.
I expect that Robert Firth is correct. It is easy to build a model claiming CO2 emissions are the primary factor, especially if not too long a history is considered.
The climate models include the known factors that affect surface temperature. They aren’t constructed to favour any particular factor. Though solar factors may have largely negated CO2 millions of years ago, CO2 is the dominant factor at the moment. You’re right that the relatively short period will impact which factor is dominant during that period but the current period is what we’re most concerned with, is it not? We are living in a world that is warming quickly (by geological time scales) due to our actions. CO2 emissions are definitely the dominant factor right now. But that’s just the way it is, it’s not the fault of the models.
An update on our holistic climate:
“Forecasters are predicting a blast of Arctic air will blanket most the United States next week with record-breaking temperatures.”
Indeed, they are predicting temperatures “30 degrees” (I suspect that’s 17C) colder than average. Of course, this is the normal climate response to the onset of a Grand Solar Minimum. The key parameter to follow, though, is the arctic ice cover, because that will mark the start of the positive feedback loop.
This is weather, not climate. Are you saying that you expect the earth to start cooling now? Non-human caused factors would have seen the earth in a cooling trend right now but it’s in a warming trend due to human caused emissions.
https://skepticalscience.com/grand-solar-minimum-mini-ice-age.htm
Natural hydrogen : A New Hope ?
http://www.hydrogenfuelnews.com/conference-in-paris-revealed-a-much-larger-supply-of-natural-hydrogen-than-once-thought/8538750/
Excerpts :
“What was found during the past few years is there’s an abundance of natural hydrogen was largely underestimated.”
“This is especially attractive, considering that natural hydrogen is not coming from fossil sources, but rather from inorganic reactions happening in the Earth’s crust and mantle at the present time. Two major possible sources include water reactions with minerals and degassing of the Earth interior, which could be rich in hydrogen accordingly to numerous studies. Therefore, natural hydrogen is carbon free and sustainable. “
“we’re dealing with the primary source of energy, where H2 is not a vector like it’s currently seen from the point of view of hydrogen economy. No energy is required to produce natural hydrogen other that to capture it in the ground.”
The question is now : how much can we extract ? At what pace ? At what cost ? And then, how is it possible to adapt our engines, machines, infrastructures to use H2 as primary energy source ? We aren’t saved yet.
But, but, ITS ALL a PONZI scheme…Surprise🤗
SCRANTON, Pa. (AP) — The fraudster called himself “King Perry,” and for a while he lived like royalty.
Perry Santillo masterminded a long-running investment scam that collected more than $115 million from 1,000 investors around the country, using some of the proceeds to fund a lavish lifestyle of cars, casino junkets and houses in multiple states, according to federal securities regulators.
At one point, Santillo threw himself a party at a Las Vegas club and had a song written for the occasion — the lyrics of which boasted that “King Perry” wears a “$10,000 suit everywhere he rides,” the Securities and Exchange Commission said in a complaint.
The Ponzi scheme eventually collapsed, and Santillo, of Rochester, New York, is likely to trade his fancy duds for prison attire when he is sentenced on criminal conspiracy and fraud charges.
Santillo appeared Monday in federal court in Scranton, Pennsylvania, to plead guilty to a federal fraud charge, having already entered a guilty plea last month to similar charges in Rochester, New York. Each charge carries a maximum 20-year prison sentence.
Prosecutors say Santillo’s victims include elderly people who lost their life savings
https://finance.yahoo.com/news/sec-king-perry-used-ponzi-060748617.html
The Big Boys won’t see a day in jail and get richer….
Gee, how stupid to entrust ones life savings to a King Perry. Far more sensible to entrust them to a 128 year old established company, or a 244 year old constitutional republic!
Ah, but was his tailor a London tailor? So vulgar……
“At the end of any economic cycle, we often get warnings that appear to be unrelated,” strategist Joseph Zidle wrote in a recent note. “It’s in hindsight that we realize that they were not at all random.” Investors saw this during the runup and aftermath of the housing bubble, he added, and we’re seeing it now.
“Among the recent troubles he thinks are connected are repo market woes, negative-yielding debt, global trade conflicts and collapsing manufacturing. And every cycle ends with excess.
“The “mother of all bubbles” in the sovereign debt market, Zidle says, is the catalyst that will likely trigger the next recession. He expects that to happen between mid-2020 and the end of 2021.”
https://www.marketwatch.com/story/the-mother-of-all-bubbles-could-blow-up-the-economy-if-profits-dont-improve-warns-blackstone-strategist-2019-11-04
From the Marketwatch article:
https://gailtheactuary.files.wordpress.com/2019/11/nov.-1-tweet-by-sven-heinrich-re-federal-reserve-balance-sheet.png
Hah – you can almost hear the Fed’s tires screeching as they shift into reverse gear!
“China will face another potential financial crisis in 2020 when local governments must pay-off over $283 billion in maturing municipal debt…
“…the annual cost of Chinese municipal bond debt maturities has ballooned from $34 billion in 2017; to $118 billion in 2018; $183 billion in 2019; and is expected to top $283 billion in 2020, according to Bloomberg.”
https://www.theepochtimes.com/chinas-2020-crisis-283-billion-of-maturing-local-debt_3136522.html
“China’s central bank cut the interest rate on its one-year medium-term lending facility (MLF) loans on Tuesday for the first time since early 2016, as policymakers work to prop up a slowing economy hit by weaker demand at home and abroad.”
https://www.reuters.com/article/us-china-economy-mlf/china-central-bank-cuts-a-key-loan-rate-for-first-time-since-2016-as-growth-slows-idUSKBN1XF05K
“Business activity in Hong Kong’s private sector fell to its weakest in 21 years in October, weighed down by anti-government protests and softening global demand, according to an IHS Markit survey published on Tuesday…
“Demand from mainland China declined at the sharpest pace in the survey’s history – which started in July 1998 – while companies also cut back on purchasing and input inventories at the fastest clip since the series began.”
https://www.reuters.com/article/us-hongkong-economy-pmi/hong-kong-business-activity-contracts-at-fastest-pace-in-21-years-idUSKBN1XF06Z
I see that the Hong Kong article also says:
Wow! Collapsing quickly, it sounds like.
Crikey! Even worse than Germany’s dismal 42.1 reading.
https://www.google.com/amp/s/mobile.reuters.com/article/amp/idUSKBN1XE0TB
It seems like a major issue is where the yuan floats relative to the dollar. If the yuan falls further, it will indeed drive up the cost of imports, including oil, coal, and natural gas. This will make it difficult for China to make goods and services cheaply. Businesses will find it more difficult to sell their goods outside the country at a profit. In fact, manufactured goods and food will be more expensive internally, if the costs of producers are covered.
If interest rates in China actually rise, this would be a second huge problem. I don’t know whether China can use QE to try to keep its interest rates down. Attempting to use QE may simply send the value of the yuan down further.
“Factory activity across the euro zone contracted sharply last month… Worryingly for policymakers at the European Central Bank, who have restarted a 2.6 trillion euro (£2.3 trillion) bond-buying programme after cutting interest rates on deposits in September, the malaise appears to be spread across the region…
“…struggles appear widespread and manufacturing activity in Germany, Europe’s largest economy, remained stuck in recession last month…”
https://uk.reuters.com/article/uk-eurozone-economy-pmi/euro-zone-factories-stuck-in-a-slump-as-trade-war-still-biting-idUKKBN1XE0TV
“The UK has fallen into an earnings recession following “the worst set of quarterly results in years” in Q3, with more than half of companies reporting lower profits for the second consecutive quarter, according to The Share Centre. The third quarter of 2019 saw profits fall by 4.5% overall…”
https://www.investmentweek.co.uk/news/4006510/worst-quarterly-results-push-uk-earnings-recession
“Italy’s south entered a recession in 2019, with GDP down by 0.2%, while the country’s GDP in the centre and north grew 0.3%, according to a report by the Association for Industrial Development in the Mezzogiorno (SVIMEZ) released Monday.”
http://www.ansa.it/english/news/2019/11/04/south-italy-in-recession-report-says_ffec53cb-1cd3-4162-9b5c-17543bf656f0.html
“Europe’s private banks face a growing crisis as their business models are undermined by negative interest rates the boss of Edmond de Rothschild Vincent Taupin has warned.”
https://citywire.co.uk/wealth-manager/news/rothschild-private-banks-facing-growing-crisis/a1290107
The story seems to be that of countries that are not adequately growing, and interest rates reflecting the lack of growth prospects. The outlook is not very good for a fix, without some way to make autos, smart cell phones, and many other things (such as public transit) much cheaper relative to citizens wages than they are today.
Affordability of all the gizmos. This is the thing they can’t possibly fix – they tried cheap credit for the masses, and that is breaking down now. There is simply no way of restoring general prosperity……
Lots of excellent sales coming up in the UK next year: chance to buy essential Collapse stuff at bargain prices…….
A merry soul, I like to see the Silver Lining. 🙂
Perhaps you should write a book as well.
With cartoons – it’ll be a hoot, Gail. So positive it’ll blow your socks off. 🙂
Honey, the kid keeps screaming give him the tablet and shit himmup!
Too much screen time changes children’s brains, study from Cincinnati Children’s finds
ANNE SAKER | CINCINNATI ENQUIRER | 16 hours ago
Young children who get more screen time than doctors recommend have differences in parts of the brain that support language and self-regulation, a study at Cincinnati Children’s Hospital Medical Center has found.
The study put 47 healthy Cincinnati-area children between 3 and 5 through magnetic resonance imaging of their brains as well as cognitive testing. While the study did not learn how screen time changed the brains, it did show that skills such as brain processing speed were affected
A Canadian study published in April found that screen time can affect attention spans in preschoolers. A March study found that mobile phone use can delay expressive language in 18-month-olds. Another JAMA Pediatrics study in April found that screen time can affect how a child performs on developmental testing.
The Cincinnati Children’s study assessed screen time using the recommendations of the American Academy of Pediatrics. The academy suggests, for example, that children younger than 18 months should avoid all screen media other than video chatting. Parents should monitor digital media and watch it with their children.
For children between 2 to 5, the AAP recommends limiting screen time to an hour a day. Parents should designate media-free times, such as dinner or driving, as well as media-free locations at home, such as bedrooms.
Just insert a computer chip in the kids brain and get it over with!
https://amp.cincinnati.com/amp/4124393002
A person wonders what is happening to society as a whole, with people always connected to one device or another. What happens to critical thinking? What happens to conversation? What happens to relationships with children?
I know that I make a point to talk to my daughter in Boston every week, usually on Sunday afternoons. So there can be good coming from these devices. It is mostly that we overuse them.
“It is mostly that we overuse them.”
Near collapse, distracted by high tech. Sounds about right.
The old solution was a drop of gin. Model child guaranteed: how sweet they look when asleep…..
Prepare to be arrested for child abuse! But I agree: when our children were teething, we rubbed vermouth on the affected spot. It worked; it was traditional; and it was probably far healthier than chemically manufactured sedatives. Plus, of course, lots of hugs and words of comfort.
“Many Americans are still recovering from the 2008 financial crisis. Almost everyone knows someone who lost a job, their retirement savings or even a home in its aftermath.
“When the housing bubble burst and sent home prices plummeting, it set off a chain of defaults that snowballed into a recession. This cautionary tale of risky lending, ballooning debt and market speculation should be a clear warning of looming perils in the student loan industry.”
https://www.cnbc.com/2019/11/04/we-should-all-be-concerned-about-the-student-debt-crisis.html
“The subprime mortgage-backed bond may be dead in America a decade after it helped trigger the global financial crisis, but a security with some of the same high-risk characteristics is starting to take off. It’s called the non-qualified mortgage — basically a loan granted to borrowers whose checkered financial record made them ineligible for conventional mortgages.
“Lenders have bundled more than $18 billion worth of these loans into bonds this year.”
https://www.bloombergquint.com/business/risky-mortgage-bonds-are-back-and-delinquencies-are-piling-up
“The leveraged loan market has doubled in size over the last ten years, overshadowing high-yield bonds as a source of financing for riskier businesses. With global growth slowing, and growth in the developed world widely acknowledged to have peaked, investors are beginning to pull back from the market. Many worry that the next recession could bring about a string of corporate defaults that hits these lenders hard.
“Analysts at Bank of America Merrill Lynch recently wrote of the US leveraged loan market, “we are seeing numerous new signs of tightening credit conditions…ranging from wide market bifurcation, to a prevalence of downgrades, rising distress, lower availability of capital for the lowest rated names”.”
https://reaction.life/crunching-the-credit-signals/
I suppose if it seemed to “work” before, it will be tried again. We have a huge number of places where risk is being added to the overall system.
More on the global auto slump:
“As the global economy faces its sharpest slowdown since the financial crisis, one industry is both culprit and victim.
“The motor industry affects the health of the global economy far more than its share of total output would suggest: carmakers have long supply chains to source parts; they are also big consumers of raw materials and chemicals, textiles and electronics; and their fortunes affect millions of service sector jobs in sales, repairs and maintenance.
“Last year the sector shrank for the first time since the global crisis. The IMF believes this fall in output accounted for more than a quarter of the slowdown in the global economy between 2017 and 2018. The sector may also be responsible for up to a third of the slowdown in global trade growth between 2017 and 2018, the fund said last month, after factoring in the spillover effects on trade in car parts and other intermediate goods…
“Research published by Fitch Ratings earlier this year argued that this global fall in car sales could have reduced world gross domestic product by as much as 0.2 per cent — significantly more than the IMF estimates — after taking account of spillovers to other industries and the effects of lower wages and profits on household and business spending.
“Much of the downturn elsewhere appears to be cyclical: the decline followed several years of surging sales, and it came just as many carmakers were being forced to make large investments to develop electric vehicles that will be lossmaking in the near term at least. But pervasive uncertainty over trade — and the resulting worries over global growth — do not help.
“As Holger Schmieding, an economist at Berenberg, pointed out, this kind of uncertainty tends to scare consumers off big ticket purchases: “If you are uncertain . . . you don’t have to buy the car.””
https://www.ft.com/content/cd2f8bdc-fef6-11e9-be59-e49b2a136b8d
“Global manufacturing shrank for a sixth straight month in October as new export orders extended their longest downturn since 2002.”
https://www.bloomberg.com/news/articles/2019-11-04/global-manufacturing-contracts-for-a-sixth-month-on-export-slump
“[US] Factory orders fell 0.6% in September, the Commerce Department said Monday. Economists were expecting a 0.4% drop, according to a MarketWatch survey. Durable goods orders fell a revised 1.2%, down slightly from last week’s initial estimate of a 1.1% decline.”
https://www.marketwatch.com/story/us-factory-orders-slump-in-september-2019-11-04
Christine Lagarde and her ilk should contemplate that: ‘uncertainty’ (realism?) is fateful in the fantasy economy, which has been built on encouraging people to consume without reflecting.
Stagnation of wages, threats of likely wealth taxes, taxes on even modest inheritances, potential loss of savings on top of the steady erosion of the last decade, the looming instability of pension schemes, all combine to put a break on consumption among those who actually think ahead (not all consumers, it’s true).
It can’t help that cars seem to last appreciably longer these days: perhaps quality needs to plunge to force new purchases, as with most domestic appliances now?
A friend paraphrased Lagarde’s jaw-dropping comment (“We should be happier to have a job than to have our savings protected,”), as, “It’s ok to steal from me everything I’ve worked for as long as I can continue being your slave,” which gave me a rueful chuckle.
Hardly surprising that the world is being roiled by protests when the elites are apparently so out of touch with reality.
Economic theory, with the emphasis on income streams alone, is out of touch with emotional and psychological reality, too.
For thousands of years, we relied on stores of grains, fruit, preserved meats and fish to survive, and if you lacked them, you died. Even herds of horses were a kind of store to those who lived off them, as well as transport. The psychological importance of savings cannot be over-estimated, it has been fixed in us by the experience of millennia.
Destroy savings, and the possibility of ever accumulating more than an inadequate amount, and the threat is felt to be existential: resulting only in at first panic, then a loss of faith, and perhaps the will to live (above all when you have known an earlier, apparently more secure state).
The next step, just before the last-stage collapse, may be a kind of Totalitarian Communism, dressed up as ‘free market Capitalism’, presided over by the likes of Lagarde – who will tell us like Macron, that we’ve ‘got it good and have no right to complain.’
Macron and Lagarde’s comments show us just how these people reason, and how they regard us.
We will be left to exchange darkly ironic jokes about it all, just like those who lived in the old Soviet bloc. Nihilism and hedonism – if you lack a religious faith – will be the only viable philosophies to make it through the day.
the stores of grains and meats have always been stores of energy against future shortages, between harvests etc
my savings pot, such as it is, is an imagined call on future energy—ie, I don’t need to keep food in my cellar because I think my savings/pension will buy that food at some future time. I dont need to worry about future harvests.
One can only live in hope!!
Possibly what Lagarde meant, was that have a cash producing job was a better bet that having interest producing savings, which in the long term will diminish
Whether she was right or not is debatable I guess
It will be all we have left, certainly! The logic of the decline is that all savings and pensions will be destroyed, inexorably.
But her error is in stating this so openly just now, and blithely assuming that it will go down well.
She should be trying to maintain the fantasy, and has pulled the curtain aside too soon.
However, the mass of people are perhaps so distracted and unobservant that it will go unnoticed and uncomprehended.
History shows, though, that people will accept the most hopeless and miserable life if they can fill their stomachs one more day, the will to merely exist is so strong. Just add some alcohol, drugs, sex and it will still seem worth it. They won’t need to be fooled, simply because they won’t be thinking much at all.
In some parts of Africa, I understand wealth is kept in the form of herds of cattle. A continuation of past practices.
In China, the tendency has been to try to keep wealth in the form of extra apartments. As far as I know it doesn’t have a property tax, so these apartments are generally not rented out. The hope is that asset prices will keep up with or exceed inflation. A March 19, 2019 article says,
Adding such a tax would likely bring down the China housing debt bubble and eliminate the value of this type of savings. But if China needs more tax revenue, this would be an idea that could be implemented, perhaps on a city by city basis.
“In some parts of Africa, I understand wealth is kept in the form of herds of cattle. ”
Indeed it is: I have seen it. This is especially true of the nomadic tribes of sub Saharan Africa, who move with their cattle. At least, the richer ones; the poorer ones move with their goats. These are rather more valuable than gold or rented apartments, which provide neither milk nor meat.
Before the White Man and his Burden, they evolved a good modus operandi with the settled tribes: they were allowed free transit and the right to abide, as necessary, for one season only. They paid for this by labour or sometimes trade goods acquired in transit. Their enemy was not the local people, but the nobles who believed in land grants, or the colonial civil servants who believed in bureaucracy.
As long as the population, of both people and animals, remained stable, it was sustainable. Until imported Western agriculture destroyed that balance. We tend to forget how recent these events were. Lord Lugard became Governor of Nigeria in 1912, but three years previously, Haber had discovered how to synthesise nitrogen fertiliser, and the downhill slope was ready and waiting.
“In some parts of Africa, I understand wealth is kept in the form of herds of cattle. A continuation of past practices.”
As the Sami ( https://en.wikipedia.org/wiki/S%C3%A1mi_people ) says: “How many reindeer do you have in the bank?”
Pretty much an instinct everywhere, at least until government come in with their promises of pensions and help for the unemployed and sick. When energy consumption per capita is growing and population is relatively young, they can often keep those promises. But it looks like it will become impossible as resource per capita become stretched and populations become older and sicker.
Wonder why piggy banks looks like pigs …
Short term savings: pig
Long term savings: cows
Good point!
The biggest source of falling car sales in 2018 was China. The China falling auto sales situation has gotten worse in 2019. Furthermore, India and EU have also been experiencing falling automobile sales in 2019. The problem is not fixing itself.
From my (eccentric as usual) perspective, falling auto sales mean that the problem is indeed solving itself. And when the sales fall to zero, the problem will be solved, and we shall soon be rid of one of the most destructive inventions our hubris and folly have ever perpetrated.
Exactly! Limits to Growth is reached when industrial consumption starts falling. We seem to be at that point now. It is not just auto sales that are falling: it is smart phones. I expect steel consumption is down. Cement consumption seems to be down, according to Ugo Bardi. I haven’t seen data to support this, however. It is behind a pay wall.
Limits to Growth comes when the population cannot afford the output of the industrial system. This is another description of collapse.
There’s never going to be a revolution that topples the current power structure. It will ride all the way down the slide. For the simple reason that there’s never before been a power structure that had all of the forces of technological society on it’s side, and was unified across the globe (neoliberal, neofascist combined government/corporate power through the debt currency system).
Control of the masses has never been easier, which is a bit paradoxical since the masses themselves have never been more numerical. But still, it’s true. Remember, they can do anything they want. They can literally shut down the atm’s and your bank accounts, while filling their own accounts with unlimited money from the central bank. All the while paying good money for security forces complete with every array of modern armaments to defend themselves.
Work for them or die, those are the two options of everybody reading this post.
We have put together all kinds of things that are subject to hacking. We now have a smart grid. Every government agency has lots of computers. Even automobiles are getting more computer controls. If any of these go wrong, we have big trouble.
There are a huge number of government promises which likely cannot be met. Guarantees on pensions. Social Security and Medicare. Insurance on bank balances, if there are huge financial problems.
It may be that citizens will not need to revolt. The centralized system may wither up and die. Federal programs may be pushed out to the states in the US. The EU may disappear. The United Nations may disappear. Big companies will voluntarily disband because international trade becomes fragmented.
We really don’t understand how things will work out, going forward.
Dolph, that is an alarming but alas most realistic assessment: thank you.
But perhaps there is one scintilla of hope. You write: “All the while paying good money for security forces complete with every array of modern armaments to defend themselves.”
This is perhaps the flaw in their plan. One lesson that tyrants and oligarchs throughout history have failed to learn is this. Sooner or later, their security forces are faced with an existential choice: protect their boss, or protect their families. And then the sword is victorious over the money, as Oswald Spengler prophesied in 1922.
The Revolution in the advanced economies will be a process, not a dramatic event: after 10 years, you wake up to find everything has changed radically.
And not to your advantage, on the whole.
Becoming a valuable tool for the very rich has much to recommend it in the short -to -medium term.
Working for them is right. I was a solo plaintiffs attorney for the last dozen years. It was a grind, and the cards are stacked in favor of the (insurance) corporations. Finally wised up, took an in house defense job. I’m busy, but I have corporate resources behind me, and the pay is substantially better. If you can’t beat ’em, join ’em. The extra dough I’m making will enable me to buy a pretty sweet bugout location in the next year or two, if BAU holds together…….
Transportation is a big energy gobblers….I lived in Boston for 17 years and can vouch for it’s stellar mass transit system. Not having to make use of a car for most of that time while living there.
On the other side of the spectrum, Charlotte had a hard bones bus system and built a light rail along South Blvd with expansion plans on the books. Now back here in South Florida and it is very sparse bus system, a trip rail system that serves 3 cities West Palm Beach, Ft Lauderdale and Miami with numerous stops and the same for a high speed rail that recently opened for service for the same cities. To be honest, one NEEDS a car in Charlotte or South Florida to commute for work.
Noticed this article on the net,
The U.S. cities with the best and worst transportation
Adriana BelmonteAssociate Editor
Yahoo FinanceNovember 4, 2019, 2:06 PM EST
https://finance.yahoo.com/news/transportation-infrastructure-usa-190648796.html
Infrastructure is the foundation to both economic growth and opportunity’
According to Value Penguin, Washington D.C., San Francisco, and Boston are the biggest metros with the cheapest public transit rates. On the other end of the spectrum, the most expensive are Los Angeles, Miami, New York, and Philadelphia.
Philadelphia not only has some of the highest annual ticket prices for public transport relative to median household income, but it also has one of the highest average ages of public transit fleet.
Yet most of the cities deemed to have the worst transportation are in lesser populated areas of the country. Why?
“You see a lot of places that have more sprawl have a greater reliance on cars in general,” Kane said. “You haven’t seen as much investment in transit or in some of these other multi-modal infrastructure options. If these places aren’t making plans and aren’t making investments in transit, is it any surprise that people aren’t going to rely as much on those systems
“Ideally, infrastructure is the foundation to both economic growth and opportunity,” Kane said. “Unfortunately, in many places, we look at a lot of this from an engineering perspective of channeling money into the same types of projects, not having enough money to put into projects, and not really looking at the economic right of these projects.”
Happy Infrastructure Week
President Donald Trump pledged to make infrastructure a top priority of his presidency. Back in April 2019, he reached a $2 trillion deal with Democrats to upgrade the country’s highways, railroads, bridges, and broadbands.
So, what do they do….???
But Infrastructure Week seemingly came to a halt after Trump grew angry at House Democrats for their investigation into him regarding his finances and Robert Mueller
One thing about Boston Metro, still a traffic NIGHTMARE and congested. That why they undertook the mega project coined The BIG DIG, later renamed the BIG PIG, due to the astonishing escalating cost, first estimated at $2 Billion and the final bill, if I remember correctly, +12 Billion dollars!
Much was cut out to achieve that too!
Public transportation seems to need big subsidies. As cities become poorer, they have less funds to put toward these projects. This is part of the problem keeping the systems in good repair.
Let us not forget the big subsidies to have the privilege to ride private automobiles?
Highways Paved With Gold
You think the government is wasting a few billion a year on mass-transit subsidies. But what about the huge subsidies for cars and trucks?
By DANIEL GROSS
https://slate.com/business/2008/07/you-think-the-government-is-wasting-a-few-billion-a-year-on-mass-transit-subsidies-but-what-about-the-huge-subsidies-for-cars-and-trucks.html
and another
https://medium.com/radical-urbanist/cars-gets-billions-in-hidden-subsidies-b3bf9e6bfafc
But, I suppose, it all depends on how on looks at the topic.
A good point, Happy. But one difference: the subsidies for motor cars are largely paid for by petrol taxes; that is, by the drivers themselves. The subsidies for trucks, on the other hand, are paid by society. I well remember, driving in Pennsylvania, how bad the roads were, because they were designed for 10 ton trucks, and were being used by 40 to trucks, that did 250 times as much damage. (The damage is proportional to the fourth power of the weight of the vehicle)
Charge the trucks a tax proportional to the damage they cause, which works out at $250,000 per 40 ton truck per annum, and freight rail begins to look like a bargain.
An excellent article on the Big Dig:
https://www.city-journal.org/html/lessons-boston’s-big-dig-13049.html
When I lived in the US, in nearby Pennsylvania, it was a standing joke (as of course was much Pa infrastructure at the time). But it was inevitable. Something had to replace the Central Artery, which had destroyed much of historic Boston for the benefit only of people driving through the city. And that something had to be far more friendly to the urban environment.
In retrospect, it was a good idea in principle; gross city mismanagement, and the exclusive use of union labour, were together responsible for most of the piggishness. But the history does show that the Greeks were right strictly to limit the size of their cities.
https://www.usdebtclock.org/
Just passed 23T in US debt, having passed 22T on Feb. 13th, 2019
https://www.npr.org/2019/02/13/694199256/u-s-national-debt-hits-22-trillion-a-new-record-thats-predicted-to-fall
That’s a bit less than 9 months to raise debt 1T?!
https://blogs.wsj.com/washwire/2015/09/28/donald-trump-says-tax-plan-could-lift-gdp-growth-to-6/
Donald Trump Says Tax Plan Could Lift GDP Growth to 6%
https://www.bea.gov/data/gdp/gross-domestic-product
Actual GDP from that last link: 2nd quarter 2% & 3rd quarter 1.9%
The year in which corporate profits were primarily helped by the tax cuts was 2018. We are now in the year after. This is the year that company profits have dropped as I showed previously (WSJ chart):
https://gailtheactuary.files.wordpress.com/2019/11/wsj_quarterly-earnings-trends.png
I know that there was supposedly some follow-on effect. The number of jobs in the US seems to have continued to grow, but it is hard to see that there is a profits impact.
My fear was that GDP would drop farther, faster after the tax cuts were over. We don’t have China and India pulling the world economy forward in the way that they were before, either.
https://www.aljazeera.com/news/2019/11/iran-breaks-crumbling-nuclear-deal-191104110945872.html
“Iran has taken further steps away from its crumbling nuclear deal with world powers by announcing it is doubling the number of its advanced centrifuges, calling the move a direct result of the United States’ withdrawal from the agreement last year. As well as operating TWICE as many advanced centrifuges banned by the 2015 accord, Tehran is working on a prototype that is FIFTY times faster than those allowed by the deal, Akbar Salehi, the head of the Atomic Energy Organisation of Iran, said on Monday.”
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“Australians are buying everyday goods at the slowest rate since the 1990-91 recession as signs grow that interest rate reductions and the Morrison government’s tax cuts have failed to encourage shoppers to open their wallets.”
https://www.smh.com.au/politics/federal/worrying-sign-retail-slumps-to-worst-performance-since-last-recession-as-jobs-weaken-20191104-p5378r.html
“Westpac is hoping to raise $2.5 billion in capital from its investors after a “disappointing year” saw its cash profit plummet.
“Australia’s second largest bank requested a trading halt from the ASX on Monday morning as part of the announcement after revealing its profit tumbled 15 per cent to $6.85 billion in the 12 months to September — its worst result since the Global Financial Crisis.”
https://www.news.com.au/finance/business/banking/westpac-wants-to-raise-25-million-capital-after-15-per-cent-profit-slide/news-story/2fb7e53c4986f4f426a2466ac523100c
Wikipedia says,
Banking in Australia is dominated by four major banks: Commonwealth Bank of Australia, Westpac Banking Corporation, Australia and New Zealand Banking Group, and National Australia Bank. There are several smaller banks with a presence throughout the country, and a large number of other financial institutions, such as credit unions, building societies and mutual banks, which provide limited banking-type services and are described as authorised deposit-taking Institutions. Many large foreign banks have a presence, but few have a retail banking presence. The central bank is the Reserve Bank of Australia (RBA). Since 2008 the Australian government has guaranteed deposits up to $250,000 per customer per institution against banking failure.[1]
It also claims:
The Media Release https://www.westpac.com.au/content/dam/public/wbc/documents/pdf/aw/ic/FY19_WBC_Results_Media_Release.pdf says that the bank also plans to cut its dividend. A small part of its problem seems to be rising delinquencies on home mortgages, both on a 30 day and 90 day past due basis. Derivative valuation adjustments are also mentioned.
Increased need for capital seems to be partly related to regulatory changes. (RBNZ and APRA capital changes.) This sounds like regulators hurting banks more than helping them, to me.
The plan is to consolidate 61 branches (lay off lots of workers, I expect) and close many ATMs.
In the past financial services were viewed a small tertiary part of an economy. It will be again.
“”We should be happier to have a job than to have our savings protected,” says incoming ECB President Christine Lagarde…
“Lagarde, of course, comes over from the IMF, an organization that has never met a currency debasement it wasn’t in favor of. Her comments suggest she’s not only going to continue flooding markets with euros…”
https://seekingalpha.com/news/3513351-new-ecb-chief-lagarde-let-savers-eat-cake
“…it is far from clear that a policy of negative interest rates would be effective in stimulating the economy, normally the main reason for cutting interest rates.
“In Japan and the eurozone there is evidence that negative rates have eroded business and consumer confidence, rather than restoring it. When the central bank takes such a dramatic and unusual step it can heighten the sense of worry about economic prospects, rather than allaying it.”
https://www.thetimes.co.uk/edition/business/negative-interest-rates-would-undermine-the-economy-s-resilience-zntts5bqt
“The Swedish central bank, the Riksbank, “pioneered” the use of negative interest rates after the financial crisis, charging banks for keeping excess reserves with it from as early as 2009. In early 2015, it cut its main policy rate, which eventually sunk as low as –0.5%.
“The bank’s goal was to prevent the Swedish krona from becoming too strong, thus hurting growth. But its drastic action also fuelled a housing bubble, which has driven private debt in Sweden to extraordinary heights…”
https://moneyweek.com/517419/chart-of-the-week-swedens-high-cost-of-negative-interest-rates/
The Riksbank article shows this chart:
https://d1btnptfa0r0eu.cloudfront.net/wp-content/uploads/2019/10/971_COTW.png
Note that Sweden is by far the smallest country shown and also only country with rising private sector debt. Even China has leveled off. Without rising debt, worldwide, the economy has a major problem.
Household debt continues to increase a steady $€200/month per person (including babies, unemployed and isis warriors), month after month. Or in other words: at a rate of 5% per year.
Meanwhile “the wealth”, ie homes have flatlined in price since a few years.
For how long can debts continue to increase 5%/year when what it is borrowed against lies flat?
“The bank’s goal was to prevent the Swedish krona from becoming too strong, thus hurting growth.”
I shall never be an economist. If the currency is stronger, what happens? Imports become cheaper, benefiting the ordinary people who consume them and the manufacturing companies who bring them in, add value, and offer them to the market. Is that not good news?
But the downside is this: they make exports more expensive, and so reduce their growth. In other words, the Riksbank sees its task as enabling as much value as possible to LEAVE the country and enrich others. Sweden is on the periphery of the global economy, to be looted to feed the centre.
Modern monetary theory in one lesson.
Like a train crash in slow motion.
And I’m inside the train.
On the whole, the psychological truth is that people can live with big economic problems, provided that savings seem more or less secure and there is some chance of making a living, inheriting, etc, but the suspicion that everything is about to go down the tubes – the message that ZIRP and NIRP clearly send out to anyone who thinks – is much more damaging and can lead to an economic seizure, a total collapse of consumer confidence.
+++
Insightful, thank you.
Dennis L.
Xabier, I believe that is exactly what sustained the feudal system of Mediaeval Europe: everybody had a stake in, and a faith in, the future. the peasant’s son would inherit his small plot of land; the duke’s son would inherit the duchy, … And the savings were not money savings, but the pruning of hedgerows, the fertilising of the land, the planting of trees, the building of watermills, … and they would endure.
I believe one of the most important attributes of our species is our time binding ability: our ability to envision, value, and plan for, the future. The mediaeval world understood this, and fostered it (see Johann Huizinga’s marvellous treatise). Our modern world does not understand this, and is unwittingly but systematically destroying it.
Understanding the connection of the future with the past is indeed very important!
Fine words for a woman who has no doubt accumulated several defined benefits pensions in her various roles…..
People want safe savings and a bloody job!
She is the kind of privileged bureaucrat who serenely tells people it’s ‘all for the common good’ while starvation takes grip.
Hmm, why do I feel a bit…..Revolutionary? 🙂
That quote from Lagarde is hilarious. I was hoping it would raise some eyebrows. Guillotine blades are a bonus, Xabier.
I’m thinking of a scythe: much more satisfying sweep to it….. 🙂
There is precedent …
https://www.theboltonnews.co.uk/news/16179302.earl-of-derby-execution-outside-man-and-scythe-picture-found/
The first quote continues as follows:
In other words, governments need to keep increasing their debt. If private borrowers don’t borrow, perhaps governments can continue their investment in non-economic enterprises, and that way perhaps they can add a few jobs, and continue all the payments on entitlements that they have promised.
“Global trade volumes shrank 1.2 per cent in August compared with the same month last year, the third consecutive monthly annual fall and the longest stretch of contraction since the global financial crisis more than a decade ago…
“Nearly 100 countries — including South Korea — saw the value of their exports shrink in the first half of the year according to an FT analysis of IMF data, up from 33 last year. Exports of machinery and transport equipment were particularly severely hit…”
https://www.ft.com/content/35297126-fa60-11e9-a354-36acbbb0d9b6
“A concentrated burst of interest rate cutting and other measures to loosen global financial conditions by the world’s central bankers looks to have largely run its course, and policymakers now appear content to wait and see if their handiwork staves off a deeper slowdown in the months ahead.”
https://uk.reuters.com/article/us-global-economy/big-central-banks-move-to-wait-and-see-mode-idUKKBN1XD09V
This FT article is behind a paywall for me.
I looked to see what the CPB World Trade Monitor says, and its indications seem to be different, at least in volumes. These still seem to be up through August. It may be that the issue is partly falling prices.
“Global stock markets look strong… The US-focussed S&P 500 and tech-heavy Nasdaq 100 both just hit all-time highs… The main reason shares rose… is the US Federal Reserve, the world’s most important central bank, has now returned to full-scale easing mode – even if Fed boss Jerome Powell pretends that isn’t true.”
https://www.telegraph.co.uk/business/2019/11/02/rate-reductions-will-cut-feds-room-manoeuvre-next-crisis-hits/
“So far, 358 of the S&P 500 SPX, +0.97% companies have reported quarterly earnings, more than 70%, and earnings have declined 2.66% from the same quarter a year ago, according to a FactSet tally.
“It could take a miracle at this point to reverse that trend and avoid prolonging the earnings recession…”
https://www.marketwatch.com/story/the-earnings-recession-looks-destined-to-continue-as-disney-and-the-rookies-take-stage-2019-11-02
“General Electric’s recent decision to freeze retirement benefits for 20,000 employees provides the latest unwelcome illustration of the problems confronting millions of US workers battling to secure a decent income in old age.
“GE’s pension obligations stood at $91.8bn at the end of last year, significantly higher than the industrial conglomerate’s $66bn market value on December 31…
“The strains on US corporate defined benefit pension plans are likely to intensify, due in part to the steep decline in long-term interest rates that are used to measure (discount) the value of future obligations to employees.”
https://www.ft.com/content/60c5b80b-b227-405a-9290-0d5f78efa0f7
“The US gross national debt – the sum of all Treasury securities outstanding – passed another illustrious milestone, $23.01 trillion, the US Treasury department disclosed on Friday. And it got there at lightning speed just eight months after having passed the illustrious milestone of $22 trillion on February 11.”
https://wolfstreet.com/2019/11/02/us-national-debt-passed-23-trillion-jumped-1-3-trillion-in-12-months/
One thing Wolf points out is the big difference between the published “Annual Deficit” and the “Growth in the National Debt,” where the Growth in the National Debt is always higher.
https://wolfstreet.com/wp-content/uploads/2019/11/US-budget-deficits-v-borrowing-fiscal-2002-2019.png
Part of the difference is the increase in the government sponsored student loans. The government disburses funds on these, but sets up a receivable on them, expecting to get paid back with interest. They add to government debt, but don’t add to the budget deficit, at least until the loans start getting written off, I expect.
Warning: article is behind a paywall. So GE is technically bankrupt: its liabilities exceed its assets. But modern monetary theory doesn’t count pension promises as liabilities, because promises to the future are not binding. Which is why most of these hapless workers will have no future.
Good point!
It is interesting how the WSJ spins the issue. Its article from four days ago is called Better-Than-Expected Earnings Ease Growth Fears—for Now: Corporate profits haven’t waned as much as analysts had predicted
It then shows a chart of earnings relative to expectations, by industry group. Energy comes in last, relative to expectations. It does, eventually show a quarterly earnings growth chart, and the latest quarter is indeed shown to the down 2.7%. But the forecast is for a quick rebound, with the downtrend stopping next quarter.
https://gailtheactuary.files.wordpress.com/2019/11/wsj_quarterly-earnings-trends.png
As a current affairs connoisseur, I have noticed that focusing on performance versus forecast rather than purely on performance is one of the media’s favourite ways of spinning bad news. It’s even more common than blaming poor national data on meteorological oddities.
“The basic tool for the manipulation of reality is the manipulation of words. If you can control the meaning of words, you can control the people who must use the words.”
— Philip K. Dick (1928-1982)
“For words are wise men’s counters—they do but reckon by them; but they are the money of fools, …”
Thomas Hobbes (1588 to 1679)
Sigh. Spot on, as usual. The WSJ looks at the vertical, the individual sectors, but not at the horizontal, the relationships between them. But if the energy sector is in trouble, how can any other sector prosper?
this article claims that “GREEN IDEOLOGY” was responsible for the MAX 737 airplane crashes http://www.thegwpf.com/eco-madness-may-be-the-reason-for-disastrous-boeing-737-max-crash/
The airline industry is basically being asked to do the impossible. The automobile industry is as well. Somehow, this cannot end well. Either prices rise too high for consumers, or safety fails, (or possibly both). Another possibility (seen especially in Germany) is cheating. Too many delusional regulators!
Here in the UK, Labour wants planes to run on liquid biofuel from bio-crops or waste food sources under their GND.
Global Warming Policy Forum. Funded by am anti science think tank that is itself funded largely by oil companies. So all those people were not killed by Boeing; they were killed by eco freaks. Shame, I cry Shame.
I am a climate change skeptic, in the sense that I believe the climate is changing, but that Nature is a far bigger driver than man. But these people are beyond the pale of either rational or morally defensible discourse.
I am afraid I don’t have a problem with this. All the “Global Warming Policy Forum” has done is post an excerpt from an editorial by a regular New York Post writer named Miranda Devine, with a link back to the original.
You seem to be questioning the right to have an organization called the “Global Warming Policy Forum.” I don’t think a person has to be anti-science to question climate change models. I can see that the fossil fuel estimates going into these models are absurd. They are also based on absurd relationships between the use of energy and the way the economy functions.
If the climate change model were simply a “science” model, the story would be different. The climate change model needs to be understood as a combination model using some science pieces together with some pieces that basically contradict science. I think people should question them. Otherwise, all we hear is the idiotic Greta views, based on a misunderstanding of what renewables can do. And many people seem to think the renewables story is based on science as well.
Gail, I apologise for not being clearer. First, I am not against any “forum”. I am against organisations that publish biased articles yet refuse to reveal who is funding those publications. That is one of the key differences between information and propaganda.
Secondly, I have no problem with climate change skeptics. My main point (and I apologise again for making it so badly) was this: I intended to point out that attempting to move the blame from Boeing to anyone else was more than bad faith, it was moral evil. The choice of scapegoat was not the issue. It was disrespecting the memory of the dead and bereaved, by abusing them in the service of a political agenda.
Even climate scientists sometimes question some of the climate change models but one certainly has to be anti-science to question the facts that science has shown about the surface temperature increase, the link to greenhouse gases and the increase of those gases being the result of fossil fuel burning, among other human actions.
Robert Firth believes that nature (that is, factors uninfluenced by humans) is a far bigger driver than humans but the science does not support this at all. I do wonder why some people believe things that are the opposite of what the science shows. However, he is right that the GWPF is not a reliable source of information.
I believe that we humans and our economies are dissipative structures. We have no power to cut back substantially on our energy consumption, without the economy and the population collapsing dramatically. I probably believe more strongly than Robert Firth that there is essentially nothing that humans can do to fix our climate change problem. It is baked into the cake, so to speak. Whether or not the population of humans had anything to do with causing the run up in CO2 is irrelevant. We cannot go back and fix the situation. We cannot fix the situation going forward, short of starting WWIII to wipe out everyone on the planet or something equivalent. The Green New Deal is no help whatsoever.
Fortunately, or perhaps not so fortunately, nature has its own solution. It will be causing the world economy to collapse in some way, which we don’t entirely understand. It looks like this will happen within the next five years. It may take out some economies sooner than others. We are already seeing the rising discord among countries and political parties.
I don’t think I believe something opposite of “what the science shows.” I think that models, based heavily on relationships that economists believe to be true, but which are not supported by the laws of physics, are not to be considered reliable. They give false indications. If it were possible for scientists to put together a model without economic nonsense being thrown in (leading to far more fossil fuel extraction than is actually possible), then we could talk about a scientific model. If we could extract all of the coal from under the North Sea and in equally unlikely areas, at economic prices, the assumptions of the climate model would be correct.
If there is anything we can do, it likely has nothing to do with fuels. Eating less meat, for example. Geoenegineering.
Climate models have proven pretty accurate, so probably have a good basis in real physics. I agree that they do not capture financial aspects of future fossil fuel use but then most of the world believes that technology will find a way to keep fossil fuel use growing forever.
So future projections are much harder, of course. This is where it becomes uncertain except for the certainty that continuing to increase the atmospheric concentration of greenhouse gases will have the expected result on surface temperature.
I agree that humans can do nothing about it, but for reasons related to human nature. As a species, we can’t alter our characteristic behaviour, so will do nothing significant to mitigate any of the environmental damage we do.
But you do continue to imply that the basic science is wrong (“Whether or not the population of humans had anything to do with causing the run up in CO2 is irrelevant”) and I don’t know why you seem to regard the basics of climate science as possibly being wrong. It may be irrelevant but there is no question about it.
Even if climate models have proven pretty accurate, it doesn’t mean that they can give accurate advice regarding what we humans should do in the future.
The way they model the future is absurd, as far as I can see. We are up against limits, and they are ignoring this fact. They are assuming that vast amount of fossil fuels can be extracted in the future, when collapse appears to be close at hand. They assume that the economy can continue to grow without growth in energy supplies, when it cannot. They assume that there is something we can do, when there is essentially nothing we can do.
It seems to me that politicians are hoping to find solutions that might work two ways–save us if fossil fuels leave us (which I see happening in the near term) or save us if somehow fossil fuel consumption grows forever. It is telling that Europe is especially on the Climate Change bandwagon. Europe has major fossil fuel problems, which politicians would like to hide from their citizens if they can. Talking about climate change serves as a distraction. The cooked up story that we can live without fossil fuels makes it sound like the people in Europe will be perfectly OK with a small amount of renewables. This is simply nonsense. Look at the negative interest rates there now. Europe is already in deep trouble.
If the climate models were accompanied by a sensible story–we need to adapt, for example, or one pointing out limits to future fossils and fresh water–I would have less objection to them.
Gail, I still sense a bias, with phrasess such as “even if climate models have proven pretty accurate” or “Climate Change bandwagon”. There is no “if”; the models have proven pretty accurate. Of course the future is a bit more tricky and, here, the models are heavily influenced by the inputs of future fossil fuel use. Several scenarios are modelled, which is why models show many different projections. One could argue that all of those scenarios are unrealistic but that is not the fault of the models. Note that I’m not saying the models are perfect but they seem to be fairly good.
Now, as you (and others) have shown, the fantasies dreamed up by some environmentalists are just that, fantasies. Again, this isn’t the fault of climate science or the climate models. Perhaps someone with the resources could configure a more realistic scenario of how future fossil use will be and run the models accordingly. That would be an interesting exercise. However, most people act as though there are no serious imminent issues, globally, which might impact their medium or long term futures, so it’s not the kind of exercise which might occur.
“I believe that we humans and our economies are dissipative structures. We have no power to cut back substantially on our energy consumption, without the economy and the population collapsing dramatically
I agree. It does seem possible to increase energy consumption by going to renewables, since the amount of sunlight the planet receives is way more than that humans manipulate. But there are certainly problems, for example, you have to find a way to use energy when you have it and make a storeable form of energy such as synthetic oil.
Until very recently, there were no proposals to solve the problems that made physics or economic sense. There *might* be one now. (It wasn’t particularly inspired to notice what can be done with really inexpensive PV power, even if it is intermittent.)
It is still possible, perhaps even likely that the population will crash. But at least there seems to be a way out of the FF and carbon problems if we want to take it.
BTW, the Chinese are watching these conceptual developments.
Climate models accurracy are not really proven by these examples. It shows that the models, which to some degree surely have parameters calibrated to historical data, decently can replicate the history. But this is of course hardly a feat. The models also do pick up the the general upward trend of the temperatures and they fit quite well, but this is also not very amazing given that an upward trend of course is a prerequisite of any climate model and the fact that the historical data already showed an upward trend. If you get some derivatives of this process right you get a decent fit for a while. We still would’t be able to separate a natural origin of the heating from CO2…
Much of the actual dynamics of the climate of our planet aren’t that well known, plenty of assumptions are far from sure. If the underlying dynamics of the climate were well known and the graphs of temp vs time were produced solely from these first principle most climate change sceptics/deniers would be convinced.
“a far bigger driver than humans”
A volcanic eruption like the one in 536 CE would sure prove that point.
How does that prove the point that “nature” is a far bigger driver than humans for the climate change we’ve seen since the pre-industrial era (indeed, for thousands of years)? Of course, some events can have a short term effect, but climate is not short term, it’s medium to long term.
I also wonder why people believe the opposite of what science shows. So what does science show?
In both Devonian and Eocene eras, the Earth was 14C warmer than the 1950 baseline. In the Permian it fell, briefly, to 4C below. Though most of the Pleistocene it was 4C to 6C below, the time of the Ice Ages.
So science shows that Nature has changed the Earth’s temperature by 20C in the past. And the 2C of claimed anthropogenic warming is somehow more important? Science, done properly, is an excellent guide to the past. Done properly, it can also be a fairly reliable guide to the future. Science with a well funded political agenda, on either side of this debate, is worthless.
As, for example, the “science” of the Intergovernmental Panel on Climate Change, which simply deleted from history the Mediaeval Warm Period (900 to 1300) and the subsequent cold spell (1300 to 1900), both of which are amply confirmed by the historical record, as well as a few thousand peer reviewed and published papers. That, again, is a temperature change of 2.5 to 3.0C, all within the memory of our civilisation, as shown for instance in the painting “Winter Camp with Skaters” (1608).
Well, those vast changes in the past occurred over deep time. Humans have warmed the planet much faster than any past period. For humans, the current warming is particularly significant, its being warmer than at any time in the history of modern humans or their predecessors, and the warming is quicker than in any other period that humans have inhabited.
So every warming has a cause. Prior to humans, the main reasons included orbital changes and solar insolation changes. Greenhouse gases were also a big factor over immense periods of time. If the current 1.2C of warming had occurred over hundreds of thousands (or even just thousands) of years, rather than just a couple of hundred, then I doubt it would be as much of an issue as it is.
The so-called MWP was not “simply deleted from history”, though the PAGES2K work may have been too late for the lat IPCC report. The MWP and LIA were not global phenomena.
When I refer to believing the opposite of what the science shows, I’m referring to the fact that the planet’s surface temperature is warming quickly, the cause of that warming is human behaviour (responsible for the equivalent of all of the warming since 1950), and that the rate of warming is having significant impacts to our climate and our ecosystems.
Human behavior like breathing and eating and having children. Unfortunately, if we are here on earth, this is what happens.
I’m not thinking of that basic human behaviour like that. Burning fossil fuels and deforesting huge tracts of land are two behaviours which influence warming. These are the main drivers for the warming we’ve seen in the last couple of centuries, particularly in the last few decades.
all that going forth and multiplying is our main problem
without that we wouldn’t be burning everything else to keep ourselves alive
Population rise is certainly making damage worse. But it is fossil fuels that have enabled such a rapid rise in population over the last couple of hundred years.
it all happened on a very specific day
since then human development leap-frogged over itself, each increase in production led to more people being born
but it can be traced back to a single event
https://medium.com/@End_of_More/the-day-that-made-your-life-possible-42f6a56c0705
Good point. Disconnecting the making of iron from the speed with which trees grew was critical in being able to produce the amount of iron an industrial society needs. If we think about the number of people in the world today compared to the number in 1709 (7.7 billion versus 0.6 billion), we now need more than 10 times as much, just to keep up with population.
We cannot eat without fossil fuels. We cannot pave roads without fossil fuels. We cannot build buildings other than simple hand made structures without fossil fuels. Epidemics would become common without fossil fuels. Population would fall rapidly without fossil fuels. Likely 90%+ of us would not make it through the bottleneck.
and the poetic end to your observations would be:
And then we wouldn’t need fossil fuels
I’m well aware of what fossil fuels have enabled, and how we’ve become dependent on them. But even if they didn’t cause such environmental destruction, they will go away at some point (at least on the scale we’re used to), so, to some extent, it doesn’t matter what fossil fuels enable us to do. If we have to get off them for resource reasons, why not get off them to try to minimise the damage they have caused and will cause?
By the way, I’m not so sure about the epidemic claim. Certainly, without fossil fuels, the widespread travel we’ve come to regard as normal, will no longer happen and that will have an impact on how diseases are picked up and spread.
“an impact on how diseases are picked up and spread.:”
It doesn’t take much travel. Consider the Black Death.
I wonder how long vaccines would hang around in such a world?
The world population is way too dense now for our current population level without a lot of water and sewage treatment plants and antibiotics. In fact, microbes are constantly mutating away from the antibiotics we have. We need refrigeration to keep immunizations.
You can see what a problem the African Swine Fever virus has become for pigs, even with fossil fuels.
If people’s nutrition goes downhill, they will be even more susceptible to viruses going around.
“water and sewage treatment plants”
It’s hard for non-engineers/scientists to grasp how important this is. The water system has largely failed in Venezuela. I have not heard much about cholera yet, but you can expect it sooner or later.
” African Swine Fever virus”
This has killed a substantial fraction of the pig population in China. There is a considerable concern that it will come to the US (in a pork sandwich). But I expect someone is working on a vaccine.
“We cannot eat without fossil fuels
Or an acceptable substitute. This may, or may not, be possible.
” roads . . . buildings . . . Epidemics . . . Or an acceptable substitute.
“Likely 90%+ ”
Agreed. Part of the problem is that we don’t have the skills needed anymore for a low tech world. The skills died out with my parents’ generation.
This is a crucial point, Keith. We’re now reliant on modern technology for almost every activity in our lives. Though there may be a few isolated communities that do have the skills, most who survive will have to learn them afresh, probably dying before they do.
” learn them afresh”
Yes, and it is not easy. I have done every step from planting wheat to eating bread I baked myself. Even with that experience, and the land with enough rain, depending on bread I was responsible for would be a chancy business.
I agree. I’ve also done every step for making bread but I didn’t use a stone to make the flour; used a hand mill instead. However, on the bread front, I’m not sure that’s going to be a good use of time and energy, in the future and humans probably only started making bread fairly recently (in the 200,000 year history of our species).
I used a hand mill too.
During the time I was baking bread I raised and butchered around a thousand rabbits. Homemade bread goes well with fried rabbit.
A big part of my objection to the whole process of looking at climate change data and then producing actions that supposedly will fix these problems is the fact that historically, the solutions that have been chosen are approximately 180 degrees from ones that would actually work.
The folks putting these models together somehow believe that the connection between energy consumption and economic growth either doesn’t exist, or can easily be manipulated to our liking. With this false assumption, they have been able to come up with policy recommendations that make no sense, if the real goal is reducing CO2 emissions.
If policymakers had understood what was really going on, (and had had the political will to fix the situation), they would have said, “Our big problem from growth in energy consumption in the future is likely to come from today’s lesser developed countries. The way we can prevent this growth is by actively discouraging the development of trade with these countries. Henceforth, countries will be rated on their ability to keep foreign trade with these countries to a minimum.”
Capping local emissions and encouraging countries to outsource production to countries with large coal resources was an incredibly stupid approach, in my opinion, if the real intent was to hold down world emissions. It was completely counterproductive.
https://gailtheactuary.files.wordpress.com/2019/04/world-co2-emissions-with-1990-2001-trend-line.png
https://gailtheactuary.files.wordpress.com/2015/06/co2-emissions-by-part-of-the-world-2014.png
Without growing emissions, the developed countries are no position to help those lesser developed countries. So, this assumption by policy makers makes no sense either. I cannot blame Donald Trump for wanting to pull out of any Climate Accord.
I sometimes think that policymakers would have been better off if they had concluded that we should start teaching rain dances in school.
Or perhaps, we should simply be thankful for counterproductive nature of the climate change actions put together by these groups to date. They have helped keep economies from collapsing in a way that would not have happened without the changes in policy purporting to prevent climate change, but in fact doing precisely the opposite.
Thank you, Gail: an analysis with which I can find no fault. Please let me add only this: the major proponents of climate change “action” do not believe their own analyses. They urge CO2 reduction, but themselves have a carbon footprint some 50 to 100 times bigger than the peasants who are supposed to cut back. They claim that rising sea levels will inundate our coastlines, and then buy multi million dollar waterfront properties. And all paid for by money robbed from those same peasants.
It is not about climate change, or saving the earth, or any such convenient meme. It is about the issue that has always obsessed the ruling class: control. And not the control of our environment and our lives, as Francis Bacon proposed; it is about control of us.
“Control is never a means to any useful end. It is a means only to more control.”
You are right. One of the big messages that the climate change model gives, the way it is currently set us, is, “We policy makers are in control. There is nothing to worry about.” It is not true, but it is one of the doctrines of the new religion that has been established.
Again, you aren’t characterising the climate models accurately. In what way do the models give a message that the politicians are in control?
They keep saying that we can fix the situation. We cannot, without killing off our population. They also say that the wind and solar will be helpful and deserve subsidies. If they were truly helpful, they would be so inexpensive that there would be no need for subsidies. They could pay high taxes, to support the rest of the economy. That is what energy sources can be expected to do.
Sorry, Gail, but you must be referring to something other than the climate models I’m thinking of. They show how warming is influenced by a number of factors and what may happen in certain scenarios (e.g. with emission curves). Can you point to climate models which say wind and solar will be helpful or that we can fix the situation? Certainly, a few climate scientists may answer questions regarding their opinions on how we approach mitigation but the climate models are not their opinions.
The scenarios that the IPCC puts together are nearly all impossible scenarios. (The lowest scenario is somewhat possible, IIRC.) I remember that Al Bates presented a study he did on the impossibility of these scenarios, which he presented at a recent Biophysical Economics conference.
These Scenarios are only made possible by absurd economic models that are made part of the IPCC models. The scientist looking at the IPCC models know nothing about how the economy operates, so they assume that the scenarios are possible. Unfortunately, the scenarios defy the laws of physics.
I looked up Al Bates presentation. https://www.isbpe.info/blog/the-paris-agreement-under-the-lens-of-biophysical-economics
The presentation is only on video, which I find hard to hear. As I look at the abstract, he too, seems to have a happily ever after spin. If we just use biochar and a few other things, we will reach a happily ever after ending.
Right, so you have an issue with the scenarios or RCPs. Not all climate scientists are happy with them, either, and so there is constant discussion on how to improve them. Maybe we’ll see some changes there for the next IPCC report. However, the climate models themselves are good.
The climate models themselves do not directly show that wind and solar will be helpful. Instead, the assumptions about how the economy can grow without fossil fuels seems to be based on the assumption that some method will allow the impossible. The closest we have is wind and solar.
The belief that wind and solar can save us seems to be an outgrowth of numerous academic analyses as well as “Levelized Cost of Energy Studies” done by industry. The issue that they have is “too narrow boundaries.” I have been closely involved with some to the groups looking at the EROEI of wind and solar, for example, and can see this issue from the front lines, so to speak. They really are not feasible without a huge upgrade to the grid and an unbelievable amount of battery storage. These additional costs have not been included, making wind and solar look far more helpful than they really are.
“a huge upgrade to the grid ”
The electrical grid is not even half of the FF consumption.
They would be so inexpensive that there would be no need for subsidies.”
Yes. Which makes me wonder about 1.69 cents per kWh of which there seem to be a few examples. Is that cost for power based on the cost to install the PV farm? Or are there subsidies involved? It’s a really important question as well as the question “will it go even lower?”
At some price for power, we can use even intermittent power by converting the energy to synthetic oil. Carbon neutral oil at that.
This is clearly untrue. Of course, it may be true for some proponents of action but your claim does not differentiate. I propose more action but I don’t fit into either of your characterisations.
What scientists around the world have learned about current climate change is not about control. How those who want to exercise control use that information is not the fault of the science.
So will you be posting on how to reduce greenhouse gas emissions to zero over the next few decades?
Many statements from the COPs have included the notion of “equity”. Developed nations have already emitted most of the greenhouse gases and (for their economies, rather than their ecosystems) have reaped the benefits of those. So requiring the main cuplrits to penalise the countries that have contributed the least to warming, seems iniquitous. However, requiring all countries to report consumption based emissions, rather that territorial emissions, may have the effect you seek.
Again, the models are good. The scenarios for future energy use, plugged into those models may not encompass the most realistic but that is not the fault of the models.
Most of the models are utter and complete nonsense.
Climate models have proven to be fairly accurate, so I’m not sure how they can be characterised as complete nonsense. However, I’m more interested in whether you might think about expanding on your ideas for reducing emissions.
The way to reduce emissions is collapse. Remove higher levels of government organizations, like EU, United Nations, World Trade Organization, NATO, and IMF. Remove international trade. This is nature’s way of fighting collapse. Follow the lead of the Soviet Union in 1991: disband.
The suggested approaches by the IPCC work in precisely the opposite direction: offshore your manufacturing to less developed countries. Building up international trade, rather than tearing it down. They lead to more CO2, rather than less. They assume that today’s think tanks will provide increasingly complex solutions. But nature dictates that complexity is what gets us into trouble.
So you advocate for collapse, Gail? I get that most of your posts show that collapse is inevitable in the short term (say, within a decade), but I’m not sure if you actually want collapse.
Governments around the world, and most of the people, are pretty much ignoring calls for action to mitigate climate change, so advocating for a switch to renewables is having little impact. Do you think advocating for collapse instead is likely to gain more acceptance?
By the way, I agree with you that eliminating global trade would be a big help with emissions.
“eliminating global trade”
Some production methods such as semiconductors chips don’t make sense with less than a globla market. At least not at the current state of the art.
Gail, thank you for all your wisdom and clear thinking. However, I have decided to walk away, at least temporarily, from this debate. Differences of opinion are good, especially what supported by reasoned argument, but when one participant keeps moving the goalposts, progress is impossible.
We had the assertion that humans are having a greater effect on the environment than Nature. I posted the data that showed Nature had in the past driven ten times as much climate change. But that doesn’t count, because it happens much more slowly. Again, not true: at the end of the Mediaeval Warm Period we saw a 2C cooling in fifty years. And the Younger Dryas, in about 13000 BC, tipped most of the Northern Hemisphere into a 4C cooler ice age in less than ten years.
I also remarked that the IPCC Report was about control, not climate. What does that have to do with politicians? The fact that the summary report, the one released to the press that started the hysteria, was written entirely by politicians, with no independent review by anybody.
So we are left with one last weak reed: climate models closely match the past data. Well, given enough fudge factors, you can produce a model that matches any set of past data; the question is, can it predict the future. As just one example, the model predicted the end of the polar ice in 2022 (James Anderson of Harvard University). But the Arctic ice is diminishing at less than one tenth the predicted rate, and the Antarctic ice is currently increasing.
I suspect the root cause is that climatologists do not understand the physics (which happens to be my area of expertise). They assume the climate is stable, essentially in homeostasis, and its response to perturbations is therefor linear. Not so: the climate is metastable; it is a system far from thermodynamic equilibrium, and the properties of such systems were explored in detail by Ilya Prigogine many decades ago. One property is this: even a small perturbation, of the right parameter in the right direction, can cause a phase change to a new, different metastable state. But we still do not know enough to predict when, why, or how such a change might happen.
Best wishes, and please keep your good comments coming.
Thanks for your fine comment!
Robert, I pointed to science that showed the MWP and LIA were not global events that were occurring almost everywhere at the same time. There have been multiple reconstructions of surface temperature over the last 1000-2000 years which don’t show any of the global changes you claim. I have not moved the goalposts. The climate change debate is about what is happening now, why it’s happening and what can be done about it. There is little argument over the first two.
Climate scientists do not assume that the climate is stable; indeed longer term reconstructions show explicitly the opposite. The Holocene has seen a fairly stable climate, however, and that has enabled civilisations to arise. Something unusual (relative to past changes) is happening now and that is the crux of the matter.
The world ecosystem takes care of itself through collapses of civilizations. This is not considered in climate models.
What humans can do to fix the economy, short of collapse, is pretty minimal, as far as I can see. Wind and solar are not solutions. Natural gas substituted for coal might be somewhat helpful, if methane losses do not contribute to too much to global warming gases. https://www.ucsusa.org/resources/environmental-impacts-natural-gas Rich nations helping poor nations is not a solution. Rich nations trying to get poor nations to hold their populations down doesn’t seem to work either, as long as trade is carried on with these nations.
There are easy ways to collapse the economy, if that is what a person wants to do. Raising interest rates would do it; cutting off international trade would as well. Stopping paving roads and building buildings would do it. Stopping building transportation vehicles is another approach. These solutions could have been done back when we first discovered a CO2 problem. Of course, world population would fall dramatically, but that is what is needed to get CO2 levels down, if that is the real goal. But persuading others to go along with such a plan is unlikely to find followers.
Humans and pre-humans lived through past ice ages. A person would assume some humans can survive climate change, whatever it may be.
Oh yeah, that seems like a reasonable assumption. It depends on when collapse happens (quickly enough to limit warming to something that is survivable in some areas). But I doubt some humans surviving will give us much comfort.
What else can a person really hope for? Are you trying to suggest that there is something we can do to fix climate change, that would also keep populations going? Perhaps if some of Keith’s ideas work out in the very short term, but otherwise I am afraid we are back to a population the world can support, with our current level of subsistence farming or hunting and gathering. Basically, not a whole lot. Probably in the thousands, not millions or billions.
“Probably in the thousands, not millions”
That’s way too low.
https://en.wikipedia.org/wiki/World_population#/media/File:World_population_growth_(lin-log_scale).png
The world population crossed the 100 million mark around 300 BCE.
It’s hypothetically possible for humans to mitigate climate change but it’s not really possible as our species can’t change its characteristic behaviour (though some individual behaviours might be at odds with that). At least not until it is too late to avoid catastrophic change (if it not already too late). For me, the constant downplaying of climate change is both frustrating and expected. It seems true, to me, that all of the “solutions” proposed by mainstream environmentalists are just a form of denial but that doesn’t mean I’m going to suddenly start to believe in some mythical alternative science that is 180 degrees oppositite to what we’ve learned over the last few decades. If I see false characterisations of the science, I’ll call that out. If I see re-hashing of irrelevant or long-debunked denialist points, I’ll also call those out. I used to be a fervent climate change denier, until a friend persuaded me to look at the science – it was a quick turnaround after that. No matter what I would like to happen or what I’d like the situation to be, I’m keen to understand what the actual situation is and what is actually possible. Whether economics gets us or environmental damage gets us first, I can’t see much that humans can realistically do to avoid collapse, though I still like to hope that future generations of all species will inherit a liveable planet.
I used to think that climate change was a huge problem and believed the IPCC reports. I later figured out that the models don’t really look very closely at important variables. Their assumptions about carbon emissions are just plain misleading. Their forecasts about the future are at best unreliable and at worst, misleading.
We have a lot of world organizations with a major aim of “helping poor countries.” These organizations sponsor the IPCC report. Inadvertently (or perhaps not so inadvertently), these reports are being used to advance the welfare and populations of the poor counties. It tends to be population, more than welfare, that is increased, however, leaving the world worse off.
Gail, you keep repeating that the climate models are wrong and make assumptions about emissions. As the models have been shown to be quite accurate so far and the assumptions are not in the models but in the scenario inputs to the models, I don’t know why you keep mischaracterising the models.
The models as presented include the Scenario Input. These are indeed wrong. This is all that readers are able to see.
I would not make a bet on whether the model without the Scenario Inputs is very realistic. I think its reliability is greatly overstated, at a minimum.
We are dealing with something that is basically the output of a political process, not one designed to give the best model for forecasting the future. The same forces that allowed the ridiculous Scenarios to be input are no doubt are influencing the rest of the model. A major reason for the climate change model seems to be to give “cover” to political leaders around the world, so that they don’t need to explain that the real reason why we are leaving fossil fuels is because they are leaving us. A second reason for the model is to try to transfer wealth from the rich countries to the poor countries. A third goal seems to be to enhance the stature of those involved in overseeing the whole process, including the meteorologists preparing the reports. Also, the many other winners based on the recommendations. Just think how funding for climate change and renewable energy has grown!
With these political goals in mind, it would be a wonder if the model were really helpful.
I don’t see why the input would be “influencing the rest of the model”. The model, by the way, is not a “climate change model” but a climate model. Given the inputs, the model shows us how surface warming evolves. The inputs in the past have been quite reasonable as the outputs from the model have been a fairly good approximation to the warming that has occurred. So we can say that the model is a fairly reliable model. As we try to project into the future, the inputs become more and more uncertain, and, as you say, the scenarios used so far are probably not all that realistic. However, no-one knows just how emissions are likely to unfold in the future. So, given that the model is fairly good, your beef is with the inputs.
It would be interesting to see what the model outputs would be with more believable scenarios about fossil fuels. The thing is, almost no-one thinks that economies will collapse or that resources will become too scarce to drive the world’s economies as currently constituted. So inputs that imply an imploding economy would probably not be believed. In this situation, what is to be done? On the one hand, we have ridiculous input scenarios which, nevertheless, appear to suggest a future global economy that most would like to believe in. On the other hand, more reasonable scenarios would imply a collapsing economy that most would think is a ridiculous notion.
The world has been conditioned to believe that inadequate models have predictive power. You seem to have been taken in by this story.
Gail, I’ve shown that the models have been fairly good predictors of warming, so far. Why do you continue to claim they are rubbish? It’s the input scenarios that run well to the future that are inadequate. I have acknowledged that. I have not been taken in by any story; I have been questioning your lumping the inputs together with the model to claim that the model is bad. This isn’t true. The models aren’t perfect, but they’re not bad.
As for predictive power, the scenarios show what is likely to happen to surface temperature if emissions follow certain trajectories. Since most people can’t seem to imagine a collapsing economy, the model runs should give them pause for thought that following most of those scenarios could result in climate catastrophe.
Many long term patterns look like straight lines, if a person looks at a short enough segment of history and uses that to project forward. The output of the IPCC models do in fact look a lot like straight lines. Even if the models do an adequate job of short term prediction, we can have no confidence that they really do an adequate job going forward for long periods, such as until 2100. Very often bends take place over the longer term. One of the pieces that may be inadequately treated is Milankovitch cycles, for example. The length of historical data limit the testing modelers can do with the models.
The economic part of the model is just plain wrong. It claims that we can somehow have an adequate growing economy with significantly less energy. This part is
wrong. It contradicts the physics of the system. This is why we hear the claim, “If we change our ways, we can hold the increase in temperatures to only ____ degrees C.”
OK, Gail, I guess I’ve tried to explain the difference between the models and the inputs but I don’t think I can put it any other way. By all means ignore the climate models, if you want to.
If the world could ignore the climate models, that would be the best outcome.
Gail, how would you propose that we estimate how much warming we might get in the future, for different emissions scenarios?
” hypothetically possible ”
Maybe. It takes enormous amounts of energy to make synfuels or sequester CO2. The energy has to be cost-effective. It’s possible that the cost of electricity from PV has fallen to the level this is possible.
And then again, perhaps not.
No electorate will ever vote a political party that is properly serious about addressing our ecological predicament into power because that would mean less of everything humans like – stuff, choice, novelty, comfort, convenience, good health, travel etc. The ‘gillet jaunes’ riots in France were initially sparked by a carbon tax.
And, even if such a party were voted into power, there is zero chance that it would be able to implement such a de-growth agenda without totally crashing the global economy.
Instead we have the political left narrowly focusing on reduced carbon emissions (in a dishonest, localised context) and advocating for a fantasy, prosperous greentopia powered by wind, solar etc., so that they can push forward an infinite growth agenda whilst pretending to be the good guys. And meanwhile, the cynical right simply pretends there isn’t even an ecological predicament to address.
You got that right. It’s impossible for parties advocating to do something serious about climate change to get in, or impossible for them to do anything about it if they do get in. All parties advocate growth and so the situation will always get worse. Until collapse.
I have mentioned it before, but here is a comprehensive description how dangerous is the current epidemic of tattoos, which is a manifestation of identity problems of the people facing the implosion of the system.
https://aging-matters.com/think-before-you-ink-tattoos-can-take-a-toll-on-your-body/
When I was a kid, I got a water based tattoo in some product and put it on my arm. A mother of two friends of mine said, “You have to leave and never come back. Do not play with my boys any longer.” I said it’ll wash off, but she wouldn’t budge and I never saw those guys again. Great buddies too. The stigma of tattoos at one time was huge! How that changed so much is a mystery, at least to me.
When visiting Japan a couple of years ago, we were told that no one with a tattoo would be allowed to visit Japanese baths. We don’t have tattoos, so it wasn’t an issue for us. But this issue does seem to be of very great concern to some cultures/religions.
I hope this information about tattoos being bad for health gets around.
The current tattoo fad seems to provide employment to quite a few artists who might have difficulty getting good-paying jobs elsewhere. Indeed estimates that the average salary for Tattoo Artists is $52,173 per year.
This is just Entertaining….
In protests around the world, one image stands out: The Joker
By Harmeet Kaur, CNN
Updated 12:20 PM EST, Sun November 03, 2019
(CNN)In cities around the world, among the sea of demonstrators who have taken to the streets, one image has stood out: the stark white face and creepy red grin of the Joker.
Artists in Lebanon and Iraq invoked the character on posters or edited him into images on social media.
Someone spray-painted “we are all clowns” onto a statue in Santiago, Chile
And in Hong Kong, protesters dressed as the Joker as an act of protest in itself, defying a government ban on face masks and face coverings during public gatherings.
Their causes are different, their grievances varied. Proposed austerity measures. Threats to democratic freedoms. Deepening inequalities between ordinary citizens and the ruling elite.
So why are some protesters in Lebanon, Iraq, Chile, Bolivia, Hong Kong and Spain taking inspiration from a psychopathic killer from a controversial film?
Art imitates Life…or the other way around
Calls Persist for Negative U.S. Yields Even as Fed Signals Pause
(Bloomberg) — The Federal Reserve may be hinting at a pause in its policy easing, but Bruno Braizinha at Bank of America Corp. sees a risk that yields on some Treasuries will go negative by 2021 as the U.S. central bank cuts rates all the way to zero.
While that may seem like a remote scenario to some, the strategist says the market can’t ignore the possibility that 5- and 7-year yields — both presently within a few basis points of 1.60% — could fall below zero. He says now’s the time to hedge against that prospect.
Braizinha wrote about the risk of sub-1% yields in the U.S. just ahead of August’s historic Treasuries rally, which drove 10-year yields as low as 1.43% on Sept. 3. That rate has since rebounded to around 1.71%, but his central view is that the benchmark yield will go even lower — to around 1.25% — in the next three months. In addition to that, he also sees the Fed being forced to return to near-zero rates amid a deterioration in the American economy and an eventual realization by investors that a U.S.-China trade deal won’t be a panacea.
“It’s important to acknowledge those risks and not overlook these scenarios,” he said by phone. “All the positive sentiment on trade is fading, and what’s changed now is that it’s more likely that at some point the Fed is going to have to cut again.”
A day after the Fed signaled a pause on Oct. 30, yields plummeted across the curve. In Braizinha’s view, the moves reflected a bias that permeated the bond market based on expectations for worsening economic data, lower yields and a flatter curve.
IF SOMEONE TOLD ME THE ABOVE JUST A SHORT WHILE AGO…SURE, AND NEXT THING YOU’LL SAY DONALD TRUMP will be PRESIDENT and get RE-ELECTED!
We are living in unreal times….one thing that keeps me going…
https://finance.yahoo.com/news/calls-persist-negative-u-yields-230000471.html
Let’s Celebrate
https://m.youtube.com/watch?v=tRV5GNUD8o8
All RIGHT
Getting off coal is fairly easy if we go to nuclear.
Oil, however, is the lifeblood of our civilization and giving up oil would be an economic disaster. Famines would kill billions, worse than the effects of CO2.
Recently, several companies in the Mideast have been offering PV for 1.69 cents per kWh. (Use Google news and search for 1.69 kWh PV,) In recent years I have worked on power satellites, trying to get the cost down to where they could be used for synthetic oil. Failed, could not get it down to less than 3 cents per kWh. But 1.69 cents per kWh corresponds to around $60/bbl synthetic fuel. We could live with that. And it is carbon neutral.
It’s based on making hydrogen from water and pulling CO2 out of the air and feeding it to a plant like Sasol’s Oryx GTL MIT engineers recently demonstrated how to get CO2 out of the air at a cost per bbl of synfuel of about $2. The hydrogen would cost about $48/bbl and the capital for the plant works out to around $10/bbl. This has not been optimized. A serious study would probably cut the cost some. Preliminary numbers are up on the google group power satellite economics.
It’s not cheap. The cost to replace the 100 million bbls/day of oil we use works out at $13 T. Done over ten years, $1.3 T/year.
But it beats economic collapse from trying to get away from oil.
It’s also possible to use the cheap power and the CO2 collector to store CO2 for about $20/ton of carbon. Taxes on carbon are twice that in some places.
The advantage that coal has had is that it is cheap. I don’t think that we can really use much oil unless we can dilute it out with cheap coal. What is important is the overall cost of the energy mix. Oil is the expensive part. Coal is what brings the average down. We can’t get along without coal, unfortunately. Or something else that will bring the overall cost down.
For making electric power, coal at best makes power for 4 cents per kWh. Power satellites, if they make sense to build at all, make power for 3 cents per kWh.
Non-energy uses of coal such as making calcium carbide, are small enough that we can probably wait a long time to fix them. Cement is a harder problem, but much of it is fired with old tires. As tires start being made from synthetic oil, even cement will produce less net CO2.
I checked USGS statistics for cement. The US produces 2% of the world’s cement supply. The largest producer by far is China, with 58% of the world’s cement production in 2018. India is the second largest producer with 7% of the world’s supply. Both China and India are large coal users.
I expect that the US practice of using old tires is only possible because of the tiny amount we produce, relative to the rest of the world.
As I think about the situation, the problem is that the price of finished products, such as concrete made from cement, cannot rise, relative to wages of average workers. Thus, it is necessary to compete with the price of used tires and coal itself, in the substitution. Having a price equivalent to that of oil doesn’t help.
The reason that cement prices are so important is because other countries use a whole lot more cement that the US does. In many countries, both roads and buildings are made from concrete. The US is able to use less concrete than the world as a whole because it makes many of its roads from asphalt and many of its buildings from wood.
In what sense would the deaths of billions be a worse disaster? Not the deaths themselves, because we are all fated to die, and mostly – even with modern medical science – in distress.
For human beings to be reduced greatly in numbers and the planet to be relieved of this impossible burden seems very desirable, not least for other forms of life.
Our civilization is not worth preserving, it has failed: the cities are hideous, and foment mental illness; we pollute and degrade on a vast scale; the arts are mostly worthless these days, entirely corrupted by the gambling of financiers and speculators – the greatest artists today are not the stars of the art market but live in obscurity; the mental level of most people is very low and perhaps worsening, and a huge % are depressed, anxious and, increasingly, angry.
These conditions can only worsen: over-population is itself one of the greatest evils.
Our consumption of irreplaceable resources has not produced wonders, beautiful architecture, exquisite arts, and healthier, saner people – as the dreamers of the 19th century hoped – only the horror of universal banality and ugliness, saturated in propaganda and delusion, and physically degraded and poisoned populations: poisoned by the very industrial methods that bring them into existence.
The civilisation of Mordor, not Lothlorien – and even the beautiful realm of the Elves had to pass one day……
Quite a few of us would like to put such changes off as far as possible.
“For human beings to be reduced greatly in numbers”
This has consequences. Things like smartphones and advancing technology just would not exist with a small population.
*if* we can reach nanotechnology, there is a good chance we could live much lighter on the planet, or better yet move into space and leave the world as a park.
I’m ok to be left in the park.
“The US Fed hopes that a 1.5% policy rate along with $60 billion a month in ongoing liquidity injections will be enough to keep stock markets afloat and avert a recession. But monetary efforts work at a lag of many months, and a global downturn is already well underway.
“An unprecedented decade-plus expansion of record debt and asset valuations have compounded financial risks from here.”
https://jugglingdynamite.com/2019/11/01/rate-cuts-arent-bullish/
“The US Fed hopes that a 1.5% policy rate along with $60 billion a month in ongoing liquidity injections will be enough to keep stock markets afloat and avert a recession.”
I think these efforts will keep stock markets from sinking in 2020, and especially since the % rate can be reduced and the injections can be increased…
and I expect these two things will happen in 2020…
but, I also expect a very unusual situation where the markets hold up fairly well, but will be accompanied by a severe recession in 2020…
CBs can create money on their computers to maintain markets, but that’s not enough to stop the coming recession…
Just want to thank whoever posted the link to the ‘consciousnessofsheep.co.uk’ website. I have been working my way back through his (Tim Watkins) recent posts. He really gets it.
: ) In a recent post he uses the term “godzillionaires” which I haven’t heard before; I find it hillarious.
This recently appeared on ZeroHedge:
https://www.zerohedge.com/economics/trade-war-chaos-spikes-us-farm-bankruptcies-24
The level of debt is of concern and it appears to be most heavily concentrated in equipment which is a depreciating asset and given the incredible, modern electronics embedded in the modern tractor, combine, etc., the maintainable lifespan must become an issue at some point.
The Amish model while not perfect and far from entirely self sustainable seems to work in that their equipment is very old, very low tech and their wealth goes into the land and trades which earn outside income. Also, they cluster in groups of say 200 people, their churches are low overhead as they worship in each other’s houses which rotate on a periodic basis.
For a modern farm, even the machine shed in which to maintain equipment is huge and often heated with excellent lighting and concrete flooring. Compare this to Amish barns, much less infrastructure.
It could be that active farmers get into a cycle where the debt on their equipment requires ever increasing amounts of land and increasing “efficiency” which in itself leads to lower prices, etc. It seems very difficult for a modern farmer to accumulate the basis of farming, land.
There is a genuine connection with the land that occurs when it is “your” land. The culture of modern farming is on Youtube as far as the mechanical/dirt part. It is difficult to see behind this curtain of modern machines, buildings, grain bins, etc. into other aspects of that life. It is rumored that a major source of cash income for some farmers comes from YouTube videos the production quality of which is impressive. As in all things, it is the image that sells, hard to find the reality unless immersed in the actual culture.
Dennis L.
They also can transfer their excess children out of the system. If they had to divide up the land to handle the many children added each generation, they would soon die out.
Gail, mediaeval feudalism solved that problem. The custom in other societies, of dividing the land among the sons, never caught on; because, as you say, it was ruinous. So the first son inherited the estate, however small; the second son went into the army, and any third son went into the church.
These, by the way, were the main routes to upward mobility. For the female children, the ladder was through marriage. It was a most stable society, and it had to be, because, after the fall of Rome, the only alternative was barbarism. For a “personal view”, but one with great insight, I refer you to Kenneth Clark’s television series “Civilisation”
Yes, there are several YT video – content producers who show in detail how they farm (beyond) organic almost daily, and clearly 4/5 of their income is from this very “online show” activity, conferences, book sales etc.. And their establishment usually uses significant off the farm inputs either in grain, hitech tools, heavy load transport for breeding stock etc..
They won’t be able to sustain themselves outside of BAU, but some of them could supplement their diet to certain extent. Usually, they also serve posh upscale market (low volume at high price), so that might just eventually morph into future symbiosis of protection by local warlord getting the best food..
“The Amish” low tech approach has been discussed several times already, that’s also not exactly closed loop, but say 70% and up.. in many respects. So, perhaps good enough in the world of scavenging potential of the bygone era (e.g. metal parts)..
It occurs to me that if we return to our corporeal analogy for the global economy, which is ageing, bloated yet starved of good nutrition, and medicated to the gills with financial palliatives and stimulants after its near fatal stroke in 2008, then the protesters can perhaps be understood as cancerous cells, stimulated by imbalances in the system which gave them life into rebelling against it.
We also now seem to have a situation wherein the social unrest, which has been brought about by dwindling prosperity and the financial inequalities that stem from that, is now starting to act as a primary driver for further declines in prosperity – a self-reinforcing feedback loop.
The Hong Kong protests have pushed the territory into recession, for example, and Chile has just had to cancel the APEC summit and UN conference in Santiago. So the cancer is metastasizing and further undermining the health of the whole.
“The world has never really recovered from the 2008 financial crisis. The current wave of demonstrations carries the resentment of many ordinary people who still feel let down and ignored by leaders and elites in a system rigged against them.”
https://www.google.com/amp/s/amp.scmp.com/comment/opinion/article/3035552/why-are-people-protesting-hong-kong-and-elsewhere-99-cent-are-still
Interesting! I am not the only one using an analogy of the economy to a human. In my analogy, the human needs to learn to consume only grass for nutrition. Here, it is described as “bloated yet starved of good nutrition.”
The “cancer is metastasizing” is a perfect analogy for what is going wrong, as the problems spread around the world!
The disparity between the richest central regions of the EU and the poor regions on the perifery has not diminished, but deepened during the post 2008 recovery.
https://elpais.com/elpais/2019/10/16/inenglish/1571220733_188092.html
Europe, like other parts of the world, is following the fate of Japan.
“The disparity”
The people are different. It’s not entirely cultural, there was heavy genetic selection involved in the UK, and I presume most of Europe, especially Germany and the Netherlands. For hundreds of years, the smart, hard-working people got relatively rich and had twice as many surviving children as the poor. The selection happened less intensely in China and likely Korea and Japan but for a longer time.
This won’t matter in a couple of generations when genome upgrades become common.
And of course those earliest to industrialise sits on all capital.
I doubt we will ever see genetic upgrades! But your main point I think is accurate. Of more relevance, though, is that the welfare states have run the same experiment in reverse. This is clearly visible in many US cities, where welfare mothers have feral children one after another, because each one gets them more subsidy. After three generations, these children are largely ineducable and genetically incapable of being socialised. They also seem to be losing the time binding ability that raised us from the apes in the first place, and if we go over that cliff there is no safe landing, anywhere.
And if the handouts ever stop, Detroit will make the collapse of Easter Island look like a walk in the park.
The Western Europe, like other developed parts of the world, are so “genetically endowed” that they are now totally dependent on the imported workforce.
Your genetic theory is ridiculous, because if the soil is poor, then also the population is poor, when ther is lack of the easy to get resources, energy etc., the population is poor, no matter how genetically endowed it is.
The soil in Iceland is very poor, but the population certainly are not. The soil in Yucatan was poor, but the Maya built a civilisation there. The soil in Fez was barely arable, but that city hosted, and still hosts, the world’s oldest university.
I hope three counter examples are enough.
How confident are we that we actually know the characteristics of the soil in Yucatan and Fez in ancient times? I have not looked at these locations, I am afraid.
David Montgomery, in Dirt: The Erosion of Civilizations hypothesizes that declining soil characteristics (shallower depth of top soil, increased salination, decreased fertility) were part of what led to collapse of civilizations. Soil needs to be built up from erosion of bedrock (among other things). Tilling the soil tends to lead to the erosion of soil faster than it can be built up.
In many cases, it seems to me the problem is resources per capita falling sufficiently low that whenever there are climate fluctuations, the civilizations go downhill quickly. Or they become vulnerable to other nations beating them in a military fashion. Or they become vulnerable to epidemics, or overthrown governments. All of the pieces seem to work together.
I wonder if there is any way to maintain soil and still feed a population. Your blog opens up more ideas for exploration than can be handled with time given.
Soil is of acute interest to me, it is a large chunk of my wealth and it is real and not subject to financial manipulation, it may decline in paper value by half, but maintained by current standards it will still make the same income in real crops based on transforming nitrogen, carbon dioxide, etc. into a crop along with solar energy – in that sense a renewable use of solar energy.
Hopefully collapse in whatever form will be avoided, it is a hard life without energy. Not that it makes much difference, but I tend to agree with your last paragraph, it is not one thing but a system which appears to be self organizing which implies it is non deterministic – or there is less self will than we humans want to believe.
Dennis L.
“to maintain soil”
It’s not hard if you understand what is going on.
The elements that are taken away by harvest, particularly phosphorous, have to be replaced.
Biochar would be a big help too.
Thank you, Gail. For Iceland and Morocco, we have the historical record; in the former case ever since the country’s founding in 874; in the latter case since the Idrisid dynasty in 700BC or so. For Yucatan, we don’t have much history, apart from king lists and such, but the area is forested, and the older trees are a mine of information about climate and soil fertility.
Though to be fair, the Maya did have a tendency to overpopulate, a problem solved by almost continual internecine warfare. Until a long period of drought led to collapse: having recorded king lists rather than weather, they were ill equipped to cope.
The ancient Maya knew how to build soil. Google “terra preta”
Arnold Toynbee proposes in “A study of history” that poor starting conditions are actually a winning concept. Something like a Nietzschean “What doesnt kill you makes you stronger”. Toynbee gives plenty of examples.
Yes indeed: Toynbee’s “Challenge and response”. Well argued, but I confess to being a skeptic. Historians are too fond of simple explanations, but Clio’s web encompasses more than our philosophies.
Yes, as long this continues to be “surplus planet” via Sun and Earth’s core activity, there are ways how to nudge nature’s biomes favorably to human nourishment needs. The problem is the past legacy path of the sheer overpop and humanoids role in effectively terraforming the planet on such scale. So we are likely standing towards the end of some big chapter. Not exactly a novel introspection on my part, but “the pain” will probably need to last several next generations more..
The philosophers of the 18th century often explicitly posed the question: ‘Why is this region comparatively poor in resources, but wealthy and accumulating capital? And this one in contrast blessed with everything, but still poor?’
The answer was always found to be intense pursuit of industry and commerce, private enterprise, and secure property rights, with rulers unable to take whatever they pleased according to their whims – so if you made it, you kept it.
This set us on the path which has led us here,after 250 years or so: a plundered planet and the greatest ever accumulation of capital, which is about to dissolve like fairy gold….
In the US, it is the rural areas that are having a lot of problem with the loss of jobs that pay reasonably well, also. Agriculture doesn’t hire many workers any more, other than low-paid seasonal harvesting workers.
In Europe, my impression has been that the eastern part, which uses lots of coal, has been doing relatively better than the rest of Europe. This is no doubt changing, as the demand for automobiles falls around the world. Spain and Italy, without much energy resources, are in bad shape.
Things really picked up in Spain over the last few years, above all for the owner class – not at all good for exploited workers on poor-quality contracts and working ‘in the black’ (although the later can be pretty good in some areas) – the superficial figures looked quite good, but now it’s starting to go undeniably into reverse.
Rural areas continue to die and empty out, villages populated by only over-60’s etc: all the attractions and amenities are in the cities.
Music to my EARS!
We are all screwed!’ The U.S. is like a banana republic and a depression could be on the way, warns money manager.
‘When this thing implodes, we are all screwed. On a global scale, we have never before created such a magnificent bubble. These central bankers are clueless, and they have proven that beyond a doubt. All they can do is to try to keep the bubble going.’
That’s Michael Pento of Pento Portfolio Strategies giving his timely Halloween-week assessment of the current climate in an interview on USAWatchdog.com.
https://www.marketwatch.com/story/qe-on-steroids-could-lead-to-a-depression-warns-money-manager-who-compares-the-us-to-a-banana-republic-2019-10-28?siteid=yhoof2&yptr=yahoo
Pento, whose holdings lean heavily on Treasurys TMUBMUSD10Y, +0.00% and gold GC00, +0.35% , expects the interest-rate cuts to keep coming in the face of record household and corporate debt.
“It’s not that it’s QE. It’s QE on steroids,” he said. “Everybody knows that this QE is permanent just like any banana republic would do, or has done.”
With all the imbalances in the system, Pento says the Fed is well aware the next recession won’t be a mild one, so it keeps pumping to avoid that fate.
“The plunge in the stock market would be huge and from a much higher level,” he said. “Back in the Great Recession, unemployment claims spiked. We had millions of people laid off, and the same thing would happen today only… much worse.”
Makes me DANCE
Another article about the Oil Patch, Democrat policies, education …
https://www.reuters.com/article/us-usa-election-drilling/drilling-ban-proposals-divide-democrats-in-u-s-oil-states-idUSKBN1XB3TK?rpc=401&
Headline: Drilling ban proposals divide Democrats in U.S. oil states
Quote
….
More than $1 billion of the state’s $2.4 billion in oil-and-gas revenue goes to public schools, according to the nonprofit New Mexico Tax Research Institute. Expecting another windfall this year, state lawmakers approved a 16% increase in school spending to $3.3 billion, to pay for a longer school year, higher teacher salaries, and increased support for low-income districts.
Governor Lujan Grisham also announced plans for a scholarship program, funded largely by oil and gas revenues, that would make the state’s colleges free for anyone with a 2.5 grade point average – an estimated 55,000 students.
Jessica Sanders, a science teacher in Rio Rancho, sees the impact in her classroom, which until the recent improvement in funding lacked basics such as enough writing implements, projectors and computers for students.
“When people talk about shutting down the oil and gas industry, I don’t think people are seeing how that will affect me and my students,” she said.
….
End Quote
T2M
Democrats need to face this issue, especially if wind and solar are not up to replacing fossil fuels.
If they really can make electric power for 1.69 cents per kWh, then it looks like it is possible to make synthetic oil for about what we pay for it today. I wonder if anyone else has made the connection? It seems likely, but I have not seen it yet.
I’m not convinced that you are putting in the layer of taxes that needs to be in the calculation as well. Governments need to get revenue from energy products. This is related to energy products needing to be able to provide a surplus to aid the rest of the economy.
I think someone would need to try it and see. No one with the current gas to liquids plants wants to replace $55 per barrel oil with its products.
“layer of taxes ”
I am not considering them at all. I don’t know what the taxes are on crude oil. I know there are heavy taxes on gasoline. Governments may have to tax other things. But I would think that a revenue stream of 100 million bbls/day at $50-$60 per bbl (~$2 T/year) would be of considerable interest even without high taxes.
It’s carbon neutral. The output of the F/T plant has to be refined into products and distributed so the existing oil companies, refineries, and pipelines would still be of use. Also, if there was more synthetic oil than needed, they could sequester CO2 at around $20/ton.
The effect of zero-interest money has not been considered. If the whole system costs around $13 T, the payback would be around 13% per year. It would take about 6.5 years to repay the investment in a given PV and F/T plant. For the next 20 years or so the cost of oil would fall to the maintenance cost and could be taxed more.
“I am not considering them at all. I don’t know what the taxes are on crude oil.”
Start here.
https://blackbearddata.com/royalty-buying-101/oil-and-gas-royalties-what-they-are
Or here its even got a pretty picture.
https://www.opec.org/opec_web/en/data_graphs/333.htm
It is not hard look it up stuff on the internet. Took me about a minute to find. Using “US taxes per barrel of oil” as the search string.
I already showed above that New Mexico’s collects $2.4 BILLION for a small part of the Permian. Which is ~10% of the state’s budget. It is way higher for the places you want to build.
T2M
The second URL is interesting. I didn’t know Japan produced any oil.
But consider Egypt, They used to have oil deposits in the Sinai Peninsula, but I think they are now depleted. West of the Nile, there is 700,000 km^2 of desert. At 100 km^2 each that’s enough for 7000 of these installations. At 34,000 bbl per plant per day, that would be ~238 million bbl/day, which is about twice what the whole world uses today.
This is how they could avoid buying oil.
I tend to be more concerned with the physics, chemistry, and first-order economics. It is to be expected that synthetic oil would be more expensive than pumping it out of the ground and it might not support high taxes.
But if we are concerned with CO2, and don’t want to give up our oil-powered civilization, then something has to be done. Relatively low-cost sunlight to carbon-neutral oil looks to be possible with current technology.
The majority of the price of oil is taxes. We keep hearing about “net energy.” I think that quite a bit of this net energy is transferred to governments through tax dollars (including royalties, carbon taxes, and taxes under a lot of other different names), so it can go to build roads, schools, and other things to help the economy as a whole.
This is a chart showing “government take” as a percentage of operating income by Barry Rodgers Oil and Gas Consulting from about 2013 (thus, when prices were high). Basically, where EROI is high, taxes are high; where EROI is low, taxes are lower. Governments understand how the “game is played.” Often, they put rates into the tax code that change based on the price of oil. The higher the price of oil, the more taxes are paid. Barry Rodgers has recomputed these taxes as percentage of operating income.
https://gailtheactuary.files.wordpress.com/2013/06/pe_worldmapunfold1-comp.jpg
The highest tax rate is 90% of operating income. Needless to say, this leaves the company with very little for reinvestment. From this map, Saudi Arabia and the Middle East are at the top level of tax revenue. They run their whole economies on the tax revenue of oil and gas. Without the taxes, they cannot feed their people. That is why they are almost desperate now. They are withholding production, in the hope of getting prices up. Otherwise, they keep raising their level of debt.
Back in 2013, I put together the slide below based on an analysis that Barry Rodgers (author of the map) had done with respect to US and Canadian oil, published in the Oil & Gas Journal. His point was that it was easier for Canadian Shale to be profitable than US oil, because Canadian Shale paid a lot less taxes.
https://gailtheactuary.files.wordpress.com/2019/11/high-taxes-slide-from-2013-bpe-conference-in-vermont.png
Note that in the US, “government take” exceeds the company’s capital expense and operating expense, combined.
There is no need for an oil and gas company to be profitable in the US to pay taxes; the royalties come off the top. It is well known that Alaskan citizens pay no state income taxes because of oil taxes. They get checks back each year, instead. Other states are very dependent on oil tax revenue also.
Any objective analysis puts the EROI of PV at under two when batteries are used. The prototype process you are spinning numbers from also uses batteries. You never responded to the poster who politely asked about the unbelievably big quantities of water used and stadium size gas storage. You didnt respond twice. Every aspect of what the fantasy that you create with supposed $ numbers is simply not achievable due to the incredible complexity facilitation and logistics the processes would have in the real world.
Lets just put that aside. The PVs have a eroi of two if batteries are used. lets just suppose the facilitation and logistical problems have solutions that are not three or ten times of the cost you cite. The massive facilitation and materials transport are all going to use energy. All of the personnel involved will have to eat heat their shelters and assume get compensated. The compensation burns a huge amount of energy. The power source itself is omost a energy sink not a source. How on earth could this scheme possibly be a energy source not a sink once the other consumptions of energy that must occur with the facilitation, material transport and storage, needs and compensation of workers are subtracted from a energy source that is two steps from a energy sink?
Inherent to your use of pricing commodities in $ is fossil fuel consumption. The entire kit and kaboodle money, financial system, resource extraction and pricing, labor, simply does not exist without fossil fuels. IMO your assumption that money pricing and all of the things that fossil fuels provide that support many types of energy sinks not just the boondoggle you are proposing will still exist and be supported by a energy sink you propose can only be described as delusional. It could be described as uninformed but we know you are no dummy. Why not just propose corn derived ethanol as your energy sink of choice?
“Any objective analysis puts the EROI of PV at under two when batteries are used. The prototype process you are spinning numbers from also uses batteries.
No batteries. At 1.69 cents per kWh, they could not have batteries.
> You never responded to the poster who politely asked about the unbelievably big quantities of water used and stadium size gas storage.
I responded with the cost of water at about a dollar a ton. The water needed is close to the oil produced in volume, so it isn’t that big a deal even if you make it by osmosis in the shipping ports and pump it to the F/T plants.
> You didn’t respond twice. Every aspect of what the fantasy that you create with supposed $ numbers is simply not achievable due to the incredible complexity facilitation and logistics the processes would have in the real world.
The Sasol plant I use for analysis has been operating for 12 years. It has a known cost. The power cost is from a bid on a PV farm. Hydrogen electrolysis cells are well-known technology. The only part that has not been deployed at scale is the CO2 capture. The MIT approach looks good, but if it does not work out, there are others to capture the CO2.
“Let’s just put that aside. The PVs have a eroi of two if batteries are used. lets just suppose the facilitation and logistical problems have solutions that are not three or ten times of the cost you cite.
No batteries. The plant makes hydrogen when the sun shines. If you are going to run the F/T plant 24/7 you need to store hydrogen and CO2. Probably underground. The plant makes around 4500 tons of oil a day. So a few days storage should be a reasonable cost.
“The massive facilitation and materials transport are all going to use energy. All of the personnel involved will have to eat heat their shelters and assume get compensated. The compensation burns a huge amount of energy. The power source itself is omost a energy sink not a source. How on earth could this scheme possibly be a energy source not a sink once the other consumptions of energy that must occur with the facilitation, material transport and storage, needs and compensation of workers are subtracted from a energy source that is two steps from a energy sink?
It takes a considerable workforce to build something like Sasol did, took them several years and it cost about a billion dollars. But the nature of such chemical processing plants is that they don’t employ many people. The 90 square km of PV might need more maintenance labor.
“Inherent to your use of pricing commodities in $ is fossil fuel consumption. The entire kit and kaboodle money, financial system, resource extraction and pricing, labor, simply does not exist without fossil fuels.
No argument. This is a preliminary proposal to replace oil-out-of-the-ground with a carbon-neutral substitute. But there is no reason I can think of why synthetic fuel will not work fine in engines and all the other uses of oil.
“IMO your assumption that money pricing and all of the things that fossil fuels provide that support many types of energy sinks not just the boondoggle you are proposing will still exist and be supported by a energy sink you propose can only be described as delusional. It could be described as uninformed but we know you are no dummy. Why not just propose corn derived ethanol as your energy sink of choice?”
Look, if this does not make synthetic fuel at around the same cost as conventional oil, then there is no reason to build them. It’s just the consequence of bolting together existing F/T technology and reasonably priced hydrogen from very low-cost PV.
If you have a better proposal to keep hydrocarbon based civilization going while we turn off the oil wells to get the CO2 under control, please say so. I am flexible, this has only come up in the last month or so. Open to any better ideas.
Thank you for your civil response Mr. Henson.
I could be wrong. Wouldnt be the first time
When we “pay” for things the manufacturer can use that payment for other oil energy produced products. Ditto for the employee.
Whether $ as we know it could hold any of its value without some natural based energy resource is really questionable. Post fossil fuel $ based analysis is useless IMO. Its like trying to calculate with base ten when the base has been changed to base two and still be accurate. Another analysis method doesnt exist. If you could develop that instead of leveraging off a system that has its base in fossil fuels that would certainly be a impressive accomplishment and lend credence to your imaginative ideas.
Supply chains depend on fossil fuel energy surpluses to work. I think its impossible to create a energy surplus to support that when the very creation itself is dependent on those supply chains.
In liu of that i dont see of synthetic oil production supporting industrial civilization. It would be in itself a product of fossil fuels. It might provide energy for a bit after fossil fuels go away but its complexity and energy inputs that give it life guarantees that it would not continue.
As far as the do you have a better idea. No. Inherent to that question is the premise that ideas will solve this. That doesnt mean that a really poor idea gets better. That does not mean that citing numbers that dont apply is valid.
“Do you have a better idea?” That statement is an assertion. It asserts that ideas are a solution to resource depletion. I dispute that assertion. Ideas didnt create natural resources they only manipulate them. Imo pretending that ideas have inherent power is part of the problem. Culturally we are taught that that assertion reflects tenaciousness and is a positive quality. I dispute that. Placing value on intellect when that same intellect has failed to create appropriate lifestyles is the prime example of our dysfunction IMO.
Perhaps we will be better creatures as hunter gatherers. perhaps not. Im not qualified to judge that.
I have to chip in on this statement from above.
///////Whether $ as we know it could hold any of its value without some natural based energy resource is really questionable.//////
There is no question about it. If you are in doubt, try cooking £$ notes and eating them, with a side of coins.—or shoving them in your fuel tank if you don’t fancy that.
The only function of cash is as an exchange medium for energy, or to hold as a promise of energy exchange
Money took over from barter, because its ‘promise value’ was easier to carrry around and use as an exchange medium. If there’s nothing to exchange then money can have no purpose.
This is why Bitcoin is the ultimate insanity in finance.
think you would agree that humans have shifted energy sources in the past. Wood to coal, to oil, and natural gas, even nuclear.
If we have an excess of oil and we want carbon or hydrogen, converting from one to the other is a project for a bunch of chemical engineers.
There is nothing magical about any energy source,
What has changed in the last month? There are several companies offering power at 1.69 cents per kWh. That’s cheap enough to make synthetic oil for about what we pay for it today.
It would involve vast investment, and pave over a substantial area of desert, but it looks a workable solution that solves both the energy problems and the carbon buildup. It’s one of the few uses of renewables I have seen that make sense.
The big problem to date is that there are no agreed solutions to get humanity off fossil fuels without utter economic disaster. Gail is absolutely correct that intermittent renewables are not helpful for electricity. However, intermittentcy doesn’t mater when making synthetic fuel this way.
There may well be other solutions to FF and the carbon buildup, But this is the first I have run into which makes even marginal sense in terms of physics and economics.
Well yes Democrats do need to face issues but are the Republicans any less clueless ???
With drill baby drill, abiotic oil? The U.S being oil dependent for as far as the eye can see!! I get it that democrats are clueless but your bias against one over the over makes me question your motives..
The Republicans miss the point that moving assets and income from the wealthy to the poor would be helpful. Also, being efficient is not really helpful, as in moving jobs to robots; what we really need is lots of jobs that pay fairly well. Furthermore, huge companies and globalization are self-defeating. There is too much energy waisted in the huge corporate structure, and in moving partially finished products around the world, so as to minimize labor costs. Someone has to be able to afford to buy the finished products, if the system is not to flat line.
“Well yes Democrats do need to face issues but are the Republicans any less clueless ???”
Examine your language. x “needs to face”. Y ” is clueless” You start with a posit of equality of x and y but then immediately demonstrate propaganda in a complete inequality both in your choice of verbs and selective use of adjectives.
Both parties are clueless however fossil fuel extraction does in fact allow industrial civilization. Renewables will not. From my perspective One is much more deceiving than the other. One will extend bau longer without collapse than the other. I think thats desirable. You may not.
“makes me question your motives..” ahhh. Groomed by the russians? Racist? For discussing a topic with (IMO) a considerable amount of objectivity and courage that she has studied with great diligence a great part of her adult life? Ever hear of something called the first amendment? Yes thats number one on bill of rights. Your comfortable threatening it by disregarding the actual issues and attacking by suggesting ulterior motives? Time to call me names now rather than be accountable?
Even when we considered the green new deal being undertaken without all the consequences of the last two articles by Gail:
Even if we take into account the gigantic task outlined here:
https://www.forbes.com/sites/rogerpielke/2019/09/30/net-zero-carbon-dioxide-emissions-by-2050-requires-a-new-nuclear-power-plant-every-day/#4744560935f7
Let us assume we built 1500 wind turbines a day.
Let us consider we generoulsy take 1000 workers for one turbine for one day, that would require 1,5 Mio workers.
World population grows at about 226.000 a day so all the work force of the GND would be outpaced for new workers seeking a job in just 6 days.
This would not even make a dent in our predicament.
If the world economy collapses, the downhill slide of CO2 emissions is likely to be greater than shown in the graph in the article. Problem solved!
https://thumbor.forbes.com/thumbor/960×0/https%3A%2F%2Fblogs-images.forbes.com%2Frogerpielke%2Ffiles%2F2019%2F09%2Fbp-mtoe-1-1200×897.jpg
you can also think of that trend as a drop in food production and consumption, i.e. die off.
not necessarily doomphd a transition into “veganism” so no die-off just a big change in our eating habits
respectfully disagree, adonis. change in eating habits will mostly be toward cannibalism, if anything, perhaps too much animal protein and fat in diet. not sustainable, either.
sounds horrible, but history is on my side of this argument. BTW, everything will be on the menu, including grass and tree bark. “Adiaronaks”, native american for “bark eaters”.
A world full of cranky and self-righteous, unbalanced Vegans like my sister?
Count me out!
Vegans are generally clueless–
Grow, gather, shoot— some insight will be gained.
Pretty sure it’ll turn out as a mix of the break-up of Yugoslavia, the Road, and Cannibal Warlords of Liberia (YouTube – check it out).
Plus the fact that humans can NOT eat about 98% of any wild growing plants/grasses/bushes/tree leaves, but we CAN eat about 98% of wild animals… Easy to see.
i think the elders know the collapse is coming probably this year and measures have been prepared for the contracting world economy such as negative interest rates and an emphasis to digital money that is why i am investing in silver as most of the big players are too this is why a seneca cliff collapse could wipe out the middle class and their lifestyle in one fell swoop that is why the C02 reduction story was created so the world would be cheering when the collapse in C02 levels occurred
“that is why the C02 reduction story was created so the world would be cheering when the collapse in C02 levels occurred”
That’s a logical leap for you?
Hint:
Nov 1 2019: 411.02 ppm
Nov 1 2018: 406.59 ppm
Highest in 800,000 years.
Adapt or die, same as it ever was (through many, many multiples of glacial and inter-glacial periods)
Junk silver has always proved readily convertible to small amounts of cash for daily needs in economies in crisis – safer than holding gold, too. Of course, assuming cash will still be around……
Bark-eating: Fins (and I think Norwegians?) used to eat some bark even in good times, so that their stomachs would be used to it – best to get in practice now !
I think they used to put it into various kinds of ‘hard bread’, although I might well be wrong on that. Maybe you can just chew the stuff?
Reminds me I must look into making hard biscuits that survive for months without needing to be put in air–tight containers.
The sami in northern norway/sweden/finland ate bark year round, they knew how to prepare it. And how to harvest without killing the tree.
Probably an appreciated addition of carbs to a diet of meat, fish and milk.
The farmers further south only ate when famine, bitter, maybe slightly poisonous bread.
Around here, acorns are now falling. I understand that these can be prepared as food, by boiling them to remove the tannin. I have never tried it.
Thank you, DJ.
Brian Fagan, an archeologist from UCSB writes about the “chumash” native americans in coastal California. a mainstay of their diet was acorns from the live oaks that populate the CA coastal mountains. i think the dried powders can be stored in bug-tight containers for long periods. the squirrel ‘competitors’ also make a tasty meal.
Another way to get rid of the tannin is feeding acorns to pigs.
Beside bark also some lichens where mixed in for instance flour, at least in scandinavia. The bark bread i once tasted was a rye and bark mix, quite decent taste, although I don’t know the proportions of bark used in the bread.
Acorns can also be used but you have to get rid of the tannins. The native european oaks have a much higher amount of tannins than many of the american oak species. At least for the european oaks boiling is not enough, you also have to leach them.
It would be an enormous help but it would not “solve” the problem given the greenhouse gases already in the atmosphere. However, I don’t see a total collapse happening during the graphed period, though serious declines are likely.
The big issue in the upcoming collapse is the financial system and its problems. People who are only focused on how much oil is in the ground tend to miss the financial aspect.
Markstcyr.com has a good article out on ”NotQE4”. I personally find it difficult to assess where we are in the process. It appears we can do QE because we have the Petro dollar still. Why wouldn’t every country do this? I think it only works for some and only for a limited time.
Emissions are more important than financial aspects, with regard to a habitable planet. But, yes, financial aspects come into play when looking at how much oil can be produced. However, the collapse in emissions suggested by your graph, will not “solve” our problem (which is really more of a predicament), even if it helps mitigate the damage.
Why anyone ever has more than a passing comment on climate change/CO2/etc is beyond me. There is nothing you or I or any of us can do without entirely crashing the system.
Keep pushing, Sysiphus.
I’ll stick with adapt or die.
naaccoach, the system will crash anyway, as Gail has shown time and time again. And that is just taking into account financial angles. There is a multitude of environmental issues also, which will cause collapse (societies can’t insulate themselves from the environment they exist in). If non-environmental issues can promote more than a passing comment, I’m quite sure environmental issues should also. After all, a habitable planet is the base requirement for any society to exist.
Whilst it’s true that no individual or small group of individuals can do anything about the environmental crises, it is also true of other crises. But we still want to talk about them.