Expect low oil prices in 2020; tendency toward recession

Energy Forecast for 2020

Overall, I expect that oil and other commodity prices will remain low in 2020. These low oil prices will adversely affect oil production and several other parts of the economy. As a result, a strong tendency toward recession can be expected. The extent of recessionary influences will vary from country to country. Financial factors, not discussed in these forecasts, are likely also to play a role.

The following are pieces of my energy forecast for 2020:

[1] Oil prices can be expected to remain generally low in 2020. There may be an occasional spike to $80 or $90 per barrel, but average prices in 2020 are likely to be at or below the 2019 level. 

Figure 1. Average annual inflation-adjusted Brent equivalent oil prices in 2018 US$. 2018 and prior are as shown in BP’s 2019 Statistical Review of World Energy. Value for 2019 estimated by author based on EIA Brent daily oil prices and 2% expected inflation.

Figure 2 shows in more detail how peaks in oil prices have been falling since 2008. While it doesn’t include early January 2020 oil prices, even these prices would be below the dotted line.

Figure 2. Inflation adjusted weekly average Brent Oil price, based on EIA oil spot prices and US CPI-urban inflation.

Oil prices can temporarily spike because of inadequate supply or fear of war. However, to keep oil prices up, there needs to be an increase in “demand” for finished goods and services made with commodities. Workers need to be able to afford to purchase more goods such as new homes, cars, and cell phones. Governments need to be able to afford to purchase new goods such as paved roads and school buildings.

At this point, the world economy is struggling with a lack of affordability in finished goods and services. This lack of affordability is what causes oil and other commodity prices to tend to fall, rather than to rise. Lack of affordability comes when too many would-be buyers have low wages or no income at all. Wage disparity tends to rise with globalization. It also tends to rise with increased specialization. A few highly trained workers earn high wages, but many others are left with low wages or no job at all.

It is the fact that we do not have a way of making the affordability of finished goods rise that leads me to believe that oil prices will remain low. Raising minimum wages tends to encourage more mechanization of processes and thus tends to lower total employment. Interest rates cannot be brought much lower, nor can the terms of loans be extended much longer. If such changes were available, they would enhance affordability and thus help prevent low commodity prices and recession.

[2] World oil production seems likely to fall by 1% or more in 2020 because of low oil prices.

Quarterly oil production data of the US Energy Information Administration shows the following pattern:

Figure 3. Quarterly World Crude Oil and Natural Gas Liquids production, based on EIA international data through September 2019. This is a fairly broad definition of oil. It does not include biofuels because their production tends to be seasonal.

The highest single quarter of world oil production was the fourth quarter of 2018. Oil production has been falling since this peak quarter.

To examine what is happening, the production shown in Figure 3 can be divided into that by the United States, OPEC, and “All Other.”

Figure 4. Quarterly world crude oil and natural gas liquids production by part of the world, based on international data of the US Energy Information Agency through September 30, 2019.

Figure 4 shows that the production of All Other seems to be steady to slightly rising, more or less regardless of oil prices.

OPEC’s oil production bobs up and down. In general, its production is lower when oil prices are low, and higher when oil prices are high. (This shouldn’t be a surprise.) Recently, its production has been lower in response to low prices. Effective January 1, 2020, OPEC plans to reduce its production by another 500,000 barrels per day.

Figure 4 shows that oil production of the United States rose in response to high prices in the 2010 to 2013 period. It dipped in response to low oil prices in 2015 and 2016. When oil prices rose in 2017 and 2018, its production again rose. Production in 2019 seems to have risen less rapidly. Recent monthly and weekly EIA data confirm the flatter US oil production growth pattern in 2019.

Putting the pieces together, I estimate that world oil production (including natural gas liquids) for 2019 will be about 0.5% lower than that of 2018. Since world population is rising by about 1.1% per year, per capita oil production is falling faster, about 1.6% per year.

A self-organizing networked economy seems to distribute oil shortages through lack of affordability. Thus, for example, they might be expected to affect the economy through lower auto sales and through less international trade related to automobile production. International trade, of course, requires the use of oil, since ships and airplanes use oil products for fuel.

If prices stay low in 2020, both the oil production of the United States and OPEC will likely be adversely affected, bringing 2020 oil production down even further. I would expect that even without a major recession, world oil supply might be expected to fall by 1% in 2020, relative to 2019. If a major recession occurs, oil prices could fall further (perhaps to $30 per barrel), and oil production would likely fall lower. Laid off workers don’t need to drive to work!

[3] In theory, the 2019 and 2020 decreases in world oil production might be the beginning of “world peak oil.” 

If oil prices cannot be brought back up again after 2020, world oil production is likely to drop precipitously. Even the “All Other” group in Figure 4 would be likely to reduce their production, if there is no chance of making a profit.

The big question is whether the affordability of finished goods and services can be raised in the future. Such an increase would tend to raise the price of all commodities, including oil.

[4] The implosion of the recycling business is part of what is causing today’s low oil prices. The effects of the recycling implosion can be expected to continue into 2020.

With the rise in oil prices in the 2002-2008 period, there came the opportunity for a new growth industry: recycling. Unfortunately, as oil prices started to fall from their lofty heights, the business model behind recycling started to make less and less sense. Effective January 1, 2018, China stopped nearly all of its paper and plastic recycling. Other Asian nations, including India, have been following suit.

When recycling efforts were reduced, many people working in the recycling industry lost their jobs. By coincidence or not, auto purchases in China began to fall at exactly the same time as recycling stopped. Of course, when fewer automobiles are sold, demand for oil to make and operate automobiles tends to fall. This has been part of what is pushing world oil prices down.

Sending materials to Asia for recycling made economic sense when oil prices were high. Once prices dropped, China was faced with dismantling a fairly large, no longer economic, industry. Other countries have followed suit, and their automobile sales have also fallen.

Companies operating ships that transport manufactured goods to high income countries were adversely affected by the loss of recycling. When material for recycling was available, it could be used to fill otherwise-empty containers returning from high income countries. Fees for transporting materials to be recycled indirectly made the cost of shipping goods manufactured in China and India a little lower than they otherwise would be, if containers needed to be shipped back empty. All of these effects have helped reduce demand for oil. Indirectly, these effects tend to reduce oil prices.

The recycling industry has not yet shrunk back to the size that the economics would suggest is needed if oil prices remain low. There may be a few kinds of recycling that work (well sorted materials, recycled near where the materials have been gathered, for example), but it probably does not make sense to send separate trucks through neighborhoods to pick up poorly sorted materials. Some materials may better be burned or placed in landfills.

We are not yet through winding down the recycling effort. Even the recycling of materials such as aluminum cans is affected by oil prices. A March, 2019, WSJ article talks about a “glut of used cans” because some markets now prefer to use newly produced aluminum.

[5] The growth of the electric car industry can be expected to slow substantially in 2020, as it becomes increasingly apparent that oil prices are likely to stay low for a long period. 

Electric cars are expensive in two ways:

  1. In building the cars initially, and
  2. In building and maintaining all of the charging stations required if more than a few elite workers with charging facilities in their garages are to use the vehicles.

Once it is clear that oil prices cannot rise indefinitely, the need for all of the extra costs of electric vehicles becomes very iffy. In light of the changing view of the economics of the situation, China has discontinued its electric vehicle (EV) subsidies, as of January 1, 2020. Prior to the change, China was the world’s largest seller of electric vehicles. Year over year EV sales in China dropped by 45.6% in October 2019 and 45.7% in November 2019. The big drop in China’s EV sales has had a follow-on effect of sharply lower lithium prices.

In the US, Tesla has recently been the largest seller of EVs. The subsidy for the Tesla is disappearing in 2020 because it has sold over 200,000 vehicles. This is likely to adversely affect the growth of EV sales in the US in 2020.

The area of the world that seems to have a significant chance of a major uptick in EV sales in 2020 is Europe. This increase is possible because governments there are still giving sizable subsidies to buyers of such cars. If, in future years, these subsidies become too great a burden for European governments, EV sales are likely to lag there as well.

[6] Oceangoing ships are required to use fuels that cause less pollution as of January 2020. This change will have a positive environmental impact, but it will lead to additional costs which are impossible to pass on to buyers of shipping services. The net impact will be to push the world economy in the direction of recession.

If oceangoing ships use less polluting fuels, this will raise costs somewhere along the line. In the simplest cases, oceangoing vessels will purchase diesel fuel rather than lower, more polluting, grades of fuel. Refineries will need to charge more for the diesel fuel, if they are to cover the cost of removing sulfur and other pollutants.

The “catch” is that the buyers of finished goods and services cannot really afford more expensive finished goods. They cut back in their demand for automobiles, homes, cell phones and paved roads if oil prices rise. This reduction in demand is what pushes commodity prices, including oil prices, down.

Evidence that ship owners cannot really pass the higher refining costs along comes from the fact that the prices that shippers are able to charge for shipping seems to be falling, rather than rising. One January article says, “The Baltic Exchange’s main sea freight index touched its lowest level in eight months on Friday, weighed down by weak demand across all segments. . .The Index posted its biggest one day percentage drop since January 2014, in the previous session.”

So higher costs for shippers have been greeted by lower prices for the cost of shipping. It will partly be ship owners who suffer from the lower sales margin. They will operate fewer ships and lay off workers. But part of the problem will be passed on to the rest of the economy, pushing it toward recession and lower oil prices.

[7] Expect increasingly warlike behavior by governments in 2020, for the primary purpose of increasing oil prices.

Oil producers around the world need higher prices than recently have been available. This is why the US seems to be tapering its growth in shale oil production. Middle Eastern countries need higher oil prices in order to be able to collect enough taxes on oil revenue to provide jobs and to subsidize food purchases for citizens.

With the US, as well as Middle Eastern countries, wanting higher oil prices, it is no wonder that warlike behavior takes place. If, somehow, a country can get control of more oil, that is simply an added benefit.

[8] The year 2020 is likely to bring transmission line concerns to the wind and solar industries. In some areas, this will lead to cutbacks in added wind and solar.

A recent industry news item was titled Renewables ‘hit a wall’ in saturated Upper Midwest grid. Most of the material that is published regarding the cost of wind and solar omits the cost of new transmission lines to support wind and solar. In some cases, additional transmission lines are not really required for the first additions of wind and solar generation; it is only when more wind and solar are added that it becomes a problem. The linked article talks about projects being withdrawn until new transmission lines can be added in an area that includes Minnesota, Iowa, parts of the Dakotas and western Wisconsin. Adding transmission lines may take several years.

A related issue that has come up recently is the awareness that, at least in dry areas, transmission lines cause fires. Getting permission to site new transmission lines has been a longstanding problem. When the problem of fires is added to the list of concerns, delays in getting the approval of new transmission lines are likely to be longer, and the cost of new transmission lines is likely to rise higher.

The overlooked transmission line issue, once it is understood, is likely to reduce the interest in replacing other generation with wind and solar.

[9] Countries that are exporters of crude oil are likely to find themselves in increasingly dire financial straits in 2020, as oil prices stay low for longer. Rebellions may arise. Governments may even be overthrown.

Oil exporters often obtain the vast majority of their revenue from the taxation of receipts related to oil exports. If prices stay low in 2020, exporters will find their tax revenues inadequate to maintain current programs for the welfare of their people, such as programs providing jobs and food subsidies. Some of this lost revenue may be offset by increased borrowing. In many cases, programs will need to be cut back. Needless to say, cutbacks are likely to lead to unhappiness and rebellions by citizens.

The problem of rebellions and overthrown governments also can be expected to occur when exporters of other commodities find their prices too low. An example is Chile, an exporter of copper and lithium. Both of these products have recently suffered from low export prices. These low prices no doubt play a major part in the protests taking place in Chile. If more tax revenue from the sales of exports were available, there would be no difficulty in satisfying protesters’ demands related to poverty, inequality, and an overly high cost of living.

We can expect more of these kinds of rebellions and uprisings, the longer oil and other commodity prices stay too low for commodity producers.


I have not tried to tell the whole economic story for 2020; even the energy portion is concerning. A networked self-organizing system, such as the world economy, operates in ways that are far different from what simple “common sense” would suggest. Things that seem to be wonderful in the eyes of consumers, such as low oil prices and low commodity prices, may have dark sides that are recessionary in nature. Producers need high prices to produce commodities, but these high commodity prices lead to finished goods and services that are too expensive for many consumers to afford.

There probably cannot be a “one-size-fits-all” forecast for the world economy. Some parts of the world will likely fare better than others. It is possible that a collapse of one or more parts of the world economy will allow other parts to continue. Such a situation occurred in 1991, when the central government of the Soviet Union collapsed after an extended period of low oil prices.

It is easy to think that the future is entirely bleak, but we cannot entirely understand the workings of a self-organizing networked economy. The economy tends to have more redundancy than we would expect. Furthermore, things that seem to be terrible often do not turn out as badly as expected. Things that seem to be wonderful often do not turn out as favorably as expected. Thus, we really don’t know what the future holds. We need to keep watching the signs and adjust our views as more information unfolds.

About Gail Tverberg

My name is Gail Tverberg. I am an actuary interested in finite world issues - oil depletion, natural gas depletion, water shortages, and climate change. Oil limits look very different from what most expect, with high prices leading to recession, and low prices leading to financial problems for oil producers and for oil exporting countries. We are really dealing with a physics problem that affects many parts of the economy at once, including wages and the financial system. I try to look at the overall problem.
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1,162 Responses to Expect low oil prices in 2020; tendency toward recession

  1. Pingback: Das sogenannte Peak Oil

  2. The US, at least for now, seems to be doing quite well in terms of jobs and pay.

    This is a chart from an opinion article called, The Economy’s Inequality Dividend: Growth Is Lifting Low-Income Workers and the Middle Class

    Wage gains are occurring particularly among lower-wage workers.

    I also noticed an article called “Hiring way up at area small businesses,” in today’s Atlanta Journal Constitution about Atlanta’s job market. I don’t think that this article is available on the internet. The big point it makes is that large businesses tend to be very exposed to international trends. As a result of problems internationally, they are not growing very fast. Small local companies tend to be more US focused. They seem to be doing much better. They are the ones adding jobs.

    My thoughts:

    Jobs growth is possible because of energy availability. The US, with its cheap oil, gas, and coal has been doing better than most other countries. The tariffs are intended to raise job growth at home.

    • Jason says:

      Plus the retirement of the baby boomers, and inflation in general helps the younger wages.
      Also, if more jobs require computer knowledge, the young have an advantage. l meet a lot of people with various backgrounds, due to my profession, mostly liberals, due to location, and I had a very intelligent patient claim that the improved economy was a carry over effect of the Obama presidency. Will Trump ever be looked at in a fair light?

      • Thinkstoomuch says:

        Is any President viewed in a fair light??? Not that I have seen or read about (everybody shades things think about President Lincoln, Jackson or Wilson). The powers of the President are vastly over rated, IMO.

        Further complicating things is the number of states and localities raising minimum wages. Plus a boat load of other factors, very few will think about the energy aspect of it. I would not have a few years ago.

        Good to learn things to consider.


    • Herbie R Ficklestein says:

      The minimum wage increased starting January 1st 2020,
      The Minimum Wage Is Rising, but These Workers Are Being Left Behind
      There is a class of worker, mostly those who get tips, whose earnings floor has not been increased since 1991

      The debate is calling attention to how many workers are still scraping by with subminimum wages. They are mostly employees who rely on tips and are exempt from minimum wage rules. Under a New Deal-era federal labor law, employers are allowed to pay as little as $2.13 an hour — unchanged since 1991 — to about 2.6 million waiters, bartenders and others who get tips, so long as the total of their tips and wages meets the federal minimum.
      Last month, a ruling from a federal court in Massachusetts found that au pairs are also now entitled to the minimum wage. Parents are resisting the change, arguing that they won’t be able to manage the significantly increased cost of child care
      The poverty rate among subminimum wage workers is nearly double that for non-tipped workers, according to a data analysis done by the Economic Policy Institute. Not surprisingly, they are also far less likely to receive paid leave of any kind; health care coverage; or retirement benefits as part of their employment. They and their families are also more likely to be supported by public assistance
      The average minimum-wage job now pays almost $12 an hour. That is believed to be the highest rate in United States history, even after adjusting for inflation. The federal minimum wage was last increased in 2009, to $7.25 from $6.55; since then, American workers have gone longer without a federal increase than at any time since the minimum wage was introduced in the 1930s. (The nation’s capital and 34 states require a higher tipped minimum wage than the federal floor of $2.13 an hour

      • I found this chart of minimum wages by state, effective January 1, 2010. https://www.paycor.com/resource-center/minimum-wage-by-state

        If a person works for a local business that doesn’t cross state lines, then all that is applicable is the state minimum wage. In Georgia, where I live, that is $5.15 an hour. Several states have no state minimum wages. In big urban areas, minimum wages are a lot higher, but so are costs.

        • Chrome Mags says:

          Minimum wage. Maybe they should call it ‘car wage’, with the slogan, “Slave your way up to a higher wage so you don’t have to sleep in your car.”

          • I know when I was a teenager, I was paid at Wisconsin’s state minimum wage, which was at that time significantly below the Federal Minimum Wage. I received my wages in cash, in a little brown envelope.

            • cashisking says:

              Nice! those were the days! Cash means something when it comes in little brown envelopes. I figure about 5 trillion little brown envelopes would take all the trees left in North America. Time to get some more zeros on those bills!

    • Denial says:

      Wait I think you are missing the elephant in the room!!!! Is it growth if it is debt laden spending that is creating it!!!! The good thing about Trump is he is willing to lie about the economy and probably willing to manipulate or lie about the actual numbers in general. That is what all countries are doing today! Why not….? If you look at the current economy that is “supposedly so great; why is there massive increase in debt spending? I am always amazed at the comments on here when people seemingly grasp what is going on and then miss the major points of what is happening!!!

      • Davidinamonthorayearoradecade says:

        okay, let’s be real then!!!!!

        under Obama, US debt rose by about $8 trillion in 8 years!!!!!

        so, what’s your point exactly?

        • Denial says:

          My point is “Mr. Political Man”! that it does not matter who is president there is no, no and no real growth!!!!! When Obama fans would come to me with how he increased the economy and got the stock market back on track I would point out the massive debt of our country! Now that Trump is office it is the same damn thing! More debt and more smoke and mirrors….the system is failing! Trump didn’t fix anything nor did Obama…I am not political gave that up a long time ago when I realized the collapse we have ahead of us….

          So david go get your MAGA hat on and watch fox news until your eyes turn red….I don’t care….political blindness keeps you from seeing the truth…

          • Davidinamonthorayearoradecade says:

            okay, got it… I thought you were being political, as in “Trump massive debt” but I now see that you actually grasp the situation which is 11+ years of massive debt…

            “Now that Trump is office it is the same damn thing! More debt and more smoke and mirrors….the system is failing!”

            yes, the system is in The Endgame, and only massive debt can delay continual recessions…

            US debt has been about 4% of GDP for many years and GDP itself barely “grows” 2%…

            you are correct, the system is failing… slowly… very very slowly…

            • Yep, but the proverbial burners hidden in the lower decks of the machine will eventually demand new sacrifices.. So, any specific ideas, how are the new following chapters in slowly – very slowly failing system – going to reveal to us.. ?

              We have already checked most of the existing boxes (global north vs. south triage, naked debt print, demand curbed by incoming generations etc.) – what’s next?
              Apart from the obvious, as some “tangential” infrastructure accelerated decay etc.. ?

            • Davidinamonthorayearoradecade says:

              “So, any specific ideas, how are the new following chapters in slowly – very slowly failing system – going to reveal to us.. ?”

              one of the most interesting questions is “Is there any new economic shocker yet to come?”

              we’ve had a huge one recently with negative interest rates… I don’t remember anyone having that on their radar 10 years ago… grade A to whomever might have seen that coming…

              otherwise, one unstoppable force will be the reduction of most all promises of future payments/handouts… the future will seem less and less important as the present times grow in problems… pensions will be gone…

              that goes with a continuing decrease in the repair/maintenance of existing infrastructure…

              and perhaps deeper negative rates which actually will start to shrink savings…

              and throw in a bit higher inflation on necessities, where it really matters…

              there are many ways to continue to downsize the economy bit by bit, and since this is happening now, why can’t it continue to decline bit by bit for many years?

              do you foresee anything “new”?

              right now, I can’t…

      • Dennis L. says:

        Let’s think about this for a minute. The a country offers to rebuild Iraq for half its oil money(someone bombed it to pieces a few years back, think of it as accelerated depreciation). Oil is money, let’s make a deal.

        Looking further, a general is killed and whether he was he a good or bad guy, depends on view point. Everyone panics, assumes WWIII is next, a certain country fires a missile, most likely in the fog of war, an honest mistake, a perfectly good plane falls to the ground secondary to said projectile and now the population of that country is seen rioting to remove the leadership of what was first thought to be the protagonist of WWIII. The dispatch of a certain general who was accused of trying to take over an embassy of a western country leads to the original leader of a country that took over a US embassy being disposed due to missile error. Well, some bumbling leader in a certain western country is either very smart of just plain lucky. Even if it is luck, luck is a good thing. This reminds one of a certain Super Bowl in the sixties, Bart Star took the football, fell over the goal line, the final buzzer rang as he hit the ground and the Packer’s won by one point. Lombardi thought that winning by one point was good enough, the other coach was heard muttering about the Packers doing this time after time – his team didn’t get winner’s rings.

        Fracking was no doubt a bad economic move, but if fracking drove down the price of oil and destabilized countries not friendly to the fracker, was that cheaper than war? If a country were to get half the oil income from Iraq and that country’s companies were get the income from rebuilding Iraq, well, those would be good manufacturing jobs, sort of like Make …. how does that go? Would that maybe repay the debt for fracking? Wasn’t something similar done back in the 80’s? In that era, some western leader got a very rich oil country to pump more oil and drive the price down and in so doing reduce its income, while causing an empire to fall apart, now that is statesmanship.

        Maybe the western leaders are not as incompetent as some would suggest.

        It is a strange world and sort of fascinating to see.

        Dennis L.

        • Dennis and others in this sub thread, lots of interesting points, thanks.

          Indeed the grand maneuver how to turn around on the dime the 1970s peak cheap resource malaise into “winning the cold war” in few years time was exceptionally cunning plan, the execution not bad either. The “West” has been evidently capable to extend and pretend over several dangerous thresholds when hitting supposedly imminent end of the road, it’s simply stunning. That’s why I’m still very doubtful about any “sure scenarios” – I do more like probabilities though. To over simplify you just can’t have competency (even to mischief) and luck falling down from heavens in your favor for ever. The next crucial threshold-crossroad seems to be building around next two decades, meaning 2020-30s..

          Some mega trends (previously not taken that seriously) are clearly coming to fruition big way, for example the “self constrained/imposed” consumption of new entering generations (no carz, gig economy, less ownership etc..), also the onslaught of rapid triage war waged on the 1.5-2.5/3rd world.. freeing up resources elsewhere. Plus new techno fixes of lasting nature (or not) incoming as new reality. Not mentioning the global seems very likely just about to fully join the Japanese naked printing regime, which would help masking nicely that decreasing capacity utilization on all fronts of the IC for a while.

          In summary, it’s a very fluent dynamics but it still wants (and is evidently capable) to kick the can some more..

        • Things don’t turn out as we expect. The self-organizing economic system seems to produce outcomes that work, even when the chances seemed remote. At times, it seems like we have many modern day miracles.

        • cashisking says:

          Yes all is well. Crisis over. Iranian people not stupid. The mad max scenario of syria, iraq, and libya not real desirable.
          Why wouldnt you come into the fold?
          Its not like they cant keep there religion, ayatollah and sell there oil for dollars.
          All that they have to do is give up there nukes and quit their shenanigans.
          Shenanigans overated. Cant spend shenanigans.
          Nukes are overated. Cant spend nukes.
          Ahh yes they only want them for energy. One the most oil rich nations wants nukes for energy. fell off the turnip truck we did. (obama like turnips).
          Door number 1 seems a lot better choice to me than door number 3 .

        • cashisking says:

          The downed airliner just gave the Iranian people a chance to vote against WWIII. YEAAA BABY. Sorry Revolutionary guard your silly shenanigans will have to be let go. How about this we will make a farsi call of duty for you?

      • GDP is a measure of finished goods and services made. It doesn’t matter how much debt had to be pumped up in order for the economy to be able to “sort of” afford those services. If you can now buy a car for $75,000, and someone will give you a loan for $75,000 to buy that car, this fact enables the production of such a vehicle.

        Trump has been using loans to buy a lot of things in his life. He is not afraid of debt.

        I think the differences are mostly in how people see that this debt should be used. Some think that the debt should be used to enable rich people to afford electric cars and solar panels on their homes. Some think the debt should be dispensed in such a way as to give monthly payments to people who would otherwise have very low incomes or no income at all. Some think the debt should be used to keep pension programs going.

        Some think that companies and earners of high incomes should be beneficiaries of more debt (through lower tax rates). Even thought this last choice seems ridiculous, if it keeps production of goods and services going a bit longer, it may be helpful. If these companies were struggling with low profitability, the tax cut can indirectly produce jobs at higher wages, especially if cheap energy is available.

        • This is interesting, perhaps the sequencing order of wants/desires and eventually aggregate consumption patterns must follow this order otherwise things don’t run smoothly in the economy. Specifically, today’s self projected middle classes (mostly precariat bordering status already anyway) desperately want to keep their perceived (vanishing) social niveau, which means lurking beyond their means on upper level class and the truly rich levels above. Hence the consumerist drive beyond their means.. (irrational living space demands, multiple new carz per family, RVs, electronic gadgets y/y update treadmill, expensive vacation activities, ..). Obviously, this was initially supercharged by energy access leverage (ever growth-normalcy bias) for several decades-generations..

          In past ~30yrs this perverse model was upgraded and made possible by moving production and increasingly also R&D “offshore” into Asia.. Now the Chinese were “smart enough” not to squander it all on frivolous individual consumption, but use it as leapfrogging opportunity on some major domestic dev fronts (e.g. long distance transport, education, foreign trade, ..) and not so much on other priorities (externally applied war machine).

          All above being just quick notes, but for me it results again in “conformation”, we are still in brewing phase (albeit advanced) of the future not at immediate precipice. Although, in retrospect say by late 2020s this could seem as naive BAU leaning expectation, actually for the triaged out civilization hubs already like in S America, the reality of living it today clearly prevails.

          • I had to do a little checking to see that you were responding to my link up at the top of this thread, relating to wages rising most for those with the least education. I also remarked that it was the smallest businesses that were adding workers.

            So your current comment, “perhaps the sequencing order of wants/desires and eventually aggregate consumption patterns must follow this order otherwise things don’t run smoothly in the economy,” in some sense refers to this link.

            The way the economy seems to be building up now is from businesses with low complexity, using workers with less than average education. This helps keep demand up. Higher paid workers can try to also raise their demand levels, but this tends to require more debt to buy goods (like education) that no longer pay back well at all.

            A little change can be tolerated, but not too much. Programmers can’t be expected to learn a new language every two years. Physicians cannot be expected to read journal articles on all of the new developments coming out. At most, they can follow their own subspecialty. It is just too bad if a patient has a problem that covers multiple sub-specialties.

            I am not sure how smart Chinese spending was. International trade can’t be kept at today’s level, I expect. Spending on transport works for a while, but reaches diminishing returns. Spending on advanced education reaches diminishing returns. Spending on health care reaches diminishing returns.

            If the war machine somehow allows the US to import more than it exports, it has a fairly significant benefit to the economy. I am also not sure how long this benefit lasts.

            • Yes, and the latter part on China was meant in relative comparison among the players obviously. The highly elevated US domestic transport energy consumption (vs RoW) by airplanes, trucks and passenger carz will sooner or later hit another reality facing wall. Probably the needed energy could be to some extent stolen abroad again, but one could expect decreasing success rate on this front as well as the time goes on..

              Also the Miuskian types (his mother and or Bezos resemble abductees) could bend the “laws of physics” on some energy storing formulae to prolong the suffering by few more chapters and totally wreck this planet. Who knows this is creepy planet-universe and we only tend to observe various derivatives of meta-reality..

            • cashisking says:

              Really in the abstract UBI makes sense. If we could all play nice we hand out a certain amount of chits to every person on the planet until resource depletion hits. Most people like working. They could pay to work. Playing nice is the hard part.

    • Robert Firthb says:

      Thank you, Gail, for more interesting information. It seems the Trump administration is indeed helping the lower paid. And that small businesses are taking the lead is also good news. Such organisations tend to hire locally, buy locally, and help in the relocalisation of the economy. All good news, in my view.

      That big, international companies are doing worse is a phenomenon I have been expecting. These companies tend to hire cheap foreign labour, in the belief it will give them a market advantage. But as the economy becomes more technology focused, these workers will begin to underperform, to need more training and supervision, and to produce lower quality output. In the long run, they are a lose. It seems Kunstler’s “Long Emergency” got a lot of things right.

  3. Morpheus says:

    Thanks for all you do Gail! I’ve been a reader and fan for years. You constantly express very complex concepts clearly and gently. It’s unfortunate that more humans don’t read this.

    • Another issue:

      “An estimated 90 per cent of migrants who came to the country during the height of the 2015 migrant crisis and received permanent residency are unemployed.”

      • Tim Groves says:

        One wonders whether Sweden will run down its pension funds in order to keep making welfare payments to the unemployed, and then promote euthanasia for retirees in an attempt to balance the books?

        • Hubbs says:

          I suspect the state will just withhold medical care. Here in the US, ?90%? of the care dollar is spent (wasted) on keeping people alive the last 6 months of their lives. Although I am a retired orthopedic surgeon, if this number is accurate, Gail can verify this percentage far better than I although anecdotally, while I was in practice, I just marveled at the expense pumped into keeping people alive. My most memorable case was a 90ish-year-old man who was incredibly alert, who fell and broke his hip. ( a non-pathologic fracture- not due to weakness of the bone from cancer, but from the impact of a fall- required a quick 30 minute surgical hip pinning with plate and screws.) He had Stage 4 (metastatic) lung cancer with known mets to the brain, and stage 4 prostate cancer with mets to the spine. He went on for days lying in bed, absolutely pissed as hell as to why he “just couldn’t get this God damned hip fixed” as the internist ran test after test, CT brain, CT Chest, Bone scan, adenosine cardiac stress test, etc., at the anesthesiologist’s insistence. By the time he was “cleared” for surgery, he had deteriorated so much that I think pneumonia had set in. And now North Carolina has some incredible BS requirement that for me, a healthy 65 yr old, with no family, no friends but an ineligible 16 year old daughter (required age 18 to drive me home after the scope ) on no meds and no active medical problems getting a routine colonoscopy requires an official medical transport attendant to stay with me at the center during the procedure and transport me home afterward. If I were to get a heart attack or suffer a colon perforation during the procedure, what would this “authorized medical transport” to be able to do while I got transported to the hospital by a formal ambulance, or if anything happened after leaving the outpatient center, what would he or she be able to do more than a regular taxi driver who would take me directly to the hospital? The bullshit and bureaucracy is mind-boggling and I am pissed!

          • I would agree with you that the health care spending in the US is absolutely absurd. An awfully lot is spent during the last few months of life, even when it is not possible (for me) to see any sense in the spending. The idea behind the “hospice” program was to cut back on this absurd spending.

            As long as the government is paying nearly all of the cost of extraordinary procedures, too many relatives feel as though they have an obligation to extend the lives of their loved ones, using whatever means are available. I have run into this too often in talking to people. “So and so (who is 80 years old) has Stage IV cancer; we found an out of state doctor who thinks he can cure her. It will take surgeries and chemo. Perhaps that there is a chance it will work, for at least a few weeks.”

            • Robert Firth says:

              “Thou shalt not kill; but needst not strive
              officiously to keep alive:”

              Arthur Hugh Clough (1819 to 1861)

              Almost ten years ago, I wrote a living will that said essentially the same thing. When God in his wisdom calls me out of this world, do not hold me back.

            • cashisking says:

              I dont trustem. Its for profit medical system. Once they see someone will pay they start to decide what procedures you need. if no ones paying you dont need them.

              Lots of people head to Thailand to die. Less drama. If im terminal think i will take a walk. Coyotes need to eat too.

            • Robert Firth says:

              cashisking, I agree with your comment. That is precisely why when I turned 70 I cancelled my health insurance. (I’d never claimed on it anyway: the first line of defence in health care is me.) So nobody is going to run up a huge insurance bill on my behalf, and so raising premiums for younger people who cannot afford any major medical expense. And by the way, a living will is here legally binding.

        • DJ says:

          The pensions are self-regulated, I think one of the worlds most sustainable pension systems, there are no promises to pay out anything that isn’t there.

          Same with health care. There are guarantees receiving treatment within certain time, but if failing to do so there is no penalty or compensation.

          Current status is
          Future (hah) government pensions will be the same no matter how much or little you worked.
          Treatments are routinely postponed. I believe average time to prostate cancer surgery is 200 days. That will weed out aggressive cancers.

          I predict occupational pensions will be put under state control (“to ensure sustainability and justice”), and then used to cover budget holes.
          Healthcare wise the trend to shelter good tax payers from faltering care will continue.

          In the future guaranteed minimum living standards will have to be cut, and that will buy time before total collapse.

          • Nearly all government “pension” schemes (such as Social Security) are basically “pay as you go.” The contributions of young people today pay for payments to today’s elderly. If these payments fall short, general tax revenue need to pay for these pensions. Future payments are not guaranteed, even though people think they are. Governments, in theory, can cut funding whenever they choose. (They will get riots, as a result.)

            There are also the pensions you talk about, which are supposedly pre-funded. The catch is that interest rates have come down greatly from when the assumptions were made. Also, if there are a lot of bond defaults, or if the stock market falls, the money that has been contributed won’t really be there. The US has a guaranty fund, but it depends on taxpayer funds for funding.

            • DJ says:

              Swedish occupational pension is not only pre-funded but also earmarked for and invested by the worker.

              As Christoper wrote- as long as stocks go up-up-up and the funds are not stolen at least top 20% will get decent pensions.

              But we’re asking for 30-40 years of positive real returns…

            • cashisking says:

              .gov is unbelievably prepared for riots in the USA. riots will be SQUASHED. Grey panthers not the best rioters either.

              I dont see that though.

              Someone always seems to buy the bonds as they come mature. My understanding is that fractional reserve banking regards USA treasury bonds as the ultimate collateral. This make buying US treasury bonds a no brainer for financial institutions as they can then create 10x 40x that amount in “money”

              Hypothetically you could buy a million in bonds if you were a bank then create ten million in cash. You could buy ten million worth of bonds with that and create 100 million in cash.

              See how this goes. So there will always be bond buyers. Very desirable instrument at any interest rate. Including negative. If your in the club and play by the rules.

              Bonds are the only example of a self replicating exponential growth phenomena. Besides humans of course.

              ss will get financed. The stock market wont fall. Whether there are goods to buy or their price is a different question.

              We will have homeless camps big as NYC way B4 that.

              Housing takes real resources to create. Materials labor. code . electric and sewage infrastructure. one doesnt create ten like bonds.

              Sure would be nice if energy food and housing were self replicating 10x to infinity and beyond like cash.


        • Christopher says:

          As DJ says the swedish system is considered to most sustainable pension system. There are no actual guarantees issued, you only get what the system can afford. The government part of the swedish pensions consists of a special tax on the employed which directly feeds the pensions there is also the four AP-funds that collects money in this system in times of plenty and are supposed to kick in during poorer times. These funds have been around since the sixties and have of course benefited much from the stock market bubble.

          Beside the government part of the pensions you are expected to have an occupational pension paid by your employer and put in some private pension fund, which also benefits from the stock bubble. Most people I talk with of upper middle class background in the age span of 35-50 seems to be quite satisfied with the numbers amassed in these funds and they expect an early retirement….

          The occupational pensions will be hard to expropriate. The AP-funds will most likely be expropriated, they are already in government control but their spending is restricted to pensions. But in the end they will likely be used to fund general government costs besides pensions. There are 1400 billion SEK in the AP-funds, about 40% of swedish GDP, most of the value is of course predicated on the value of the stock exchange.

          My conclusion is that the swedish pension system may be the worlds most sustainable system but the sustainability of the swedish pension is entirely predicated on the global stock market bubble which will most likely not prove to be sustainable.

          • DJ says:

            There are workarounfs.

            State wants to build a railroad- have the AP funds invest in the railroad.

            State have too little pension fund, and “rich” have too much occupational pension- let government pension fall to say 3k, but at least 10k guaranteed. Those with occupational pension will in effect get a 7k deduction.

            • Christopher says:

              Sure, possibly this will be tested. At least wasting the AP-funds on state expenditures.

              The second proposal will appear as theft to many more. If the values of swedish government bond and the stock exchange will remain on it’s current levels it may of course be tested. Somehow I can’t get rid of the suspicion that these values will prove to be rather shaky, at least adjusted for inflation.

          • Financial systems fail and governments fail. If either of these things fail for Sweden, the Swedish pension system will be like every other pension system in the world–not really available, I am afraid.

            Government guarantees are no stronger than the ability of the government of continue as it is today.

          • cashisking says:

            Along the lines of normans comment earlier- you cant own the planet. Studying native cultures, its clear to me there was incredible hardship. No one really knew whether there would be continuance in yearly period not only for individuals but for the whole tribe. I have no allusions about how hard that life must have been I do wonder what it would be like living understanding impermanence instead of living caught inbetween understanding it and living with the frail structures that try to negate it to some extent that have been there our whole lives. I wonder if in a understanding impermanence there was unity both on a individual and tribal level even as I shy from the hardness of those lives.

      • Denial says:

        Not denying this but could you please site your sources when you make claims……otherwise you turn the water in to a dirty mess
        “An estimated 90 per cent of migrants who came to the country during the height of the 2015 migrant crisis and received permanent residency are unemployed.”

      • Robert Firth says:

        No surprise there. The migrants did not come for work; they came for welfare. And they have what they came for, so why bother working?

        Repeat after me: the only way to get rid of the wasps is to put the lid back on the marmalade jar.

        • Now, this comment will “automatically” turn some people glowing hot mad, but just ponder the following.. During recent days large part of the European TV was dedicated to coverage of the sport activities in various biathlon races, meaning guys and gals running dozens of miles in snowy mountains, occasionally sharp shooting at the range etc.. Hugely popular across many, especially northern states. Most likely this interest and all stems from some atavistic “hunt” or “war” making activities of the past..

          In strange contrast many of these very same societies absolutely object to fully back standing laws, so external frontier of the EU is not protected, often various parts of the agencies-apparatus are actively helping incoming migration waves to get in.. And no I’m not advocating for open fire on them, denying access/entry and not carrying blue water rescue should be enough.

          This is obviously uneasy realm of decision making, but one can clearly draw parallels into past self destructing behavior of various cultures and civilizations.

          • Xabier says:

            Over-civilised, media-saturated people are often in love with the ego-image of themselves as just, generous, kind: leading to self-destruction and detachment from reality.

            The very high unemployment and crime rates among recent Asian, African and the all-star Gypsy immigrants (50% + in most countries) speak volumes – not to mention the evidence of their being exploited and enslaved by other migrants and criminals on a massive scale. A dismal picture!

            Governments have, in effect, been acting as accomplices of the people-smuggling gangs.

            Weak government has meant that, say, a boy can be kidnapped in Vietnam and find himself months later in Britain tending a cannabis farm under threat of death, having been gang-raped repeatedly, as in a recent case in the UK.

        • I don’t know about the situation in Europe, but we in the US seem to have found a lot of hard-working immigrants that come here. We find immigrants in a wide range of job categories. We see quite a lot of working women wearing hajibs, for example.

          I don’t know the particulars in Europe. Lack of training? Not speaking the language? Too generous a benefit system?

          It no doubt takes time to integrate newcomers. We have enough Hispanics in the US that many of them seem to speak Spanish exclusively on their jobs, for example. There are Hispanic-owned companies providing tree trimming and removal services, painting services, landscaping services and many other services. Their children learn English, even if the parents don’t learn quickly.

          • agreed

            if we in uk stop migrants, our elderly will remain uncared for, our veg will remain in the fields and our cars will remain unwashed

            too simplistic?


            but this is where we are right now.

          • That’s defaulting into the classic long winded argument about the nature and pro/cons of immigration. I simply observe and posit that almost no strings attached form of migration, meaning pre paid generous benefits, ghettos formation etc. is something completely else from the minority of active, skilled and welcomed melting-pot few in between participants. Not mentioning the whole issue has been supercharged by the economic-school/gov faction looking only after aggregate volume per head, i.e. the bigger inrush the $better argument.

            It’s tricky also in historical context, e.g. the supposed Ugro-Fin branch of ancient Uralians the Hun-garians made a lot of mess when forcefully joining Europe in the middle ages. Well, they paid their duties later when for centuries guarded the front-line from the Ottoman Turk wave of invasions.

            Now, we have been into this before, but clearly the genetic (and specific biome adaptation) conformity follows (from northern lat) more or less the route of W. European (Celtic-German/Nordic-Latin) ->CEE/Slavic->UgroFins-> … -> various blends of Caucasians … -> Asians incl. the branch of native Americans.. -> … -> Middle Eastern -> … -> Africans

            Well, the past few brief thousand yrs and especially few last centuries attempted to fast track – equalize adaptation on this wide front (also incl. slavery), but it’s obviously impossible for everybody on different stage and everywhere to achieve it.. lofty arguments on “default” human brotherhood aside.

          • DJ says:

            Compared to US Europe has:
            Higher minimum wages
            Higher benefits
            Much lower wage spread

            This means a lot of US work opportunities doesn’t exist in Europe.

            N/W europe has two kind of immigrants:
            Eastern europeans building and cleaning cheaper than natives
            Non-europeans to high extent not finding a place on the job market.

  4. Dennis L. says:


    Assumption: the above cited article is approximately correct.

    How did ASPO get it so wrong?

    There is no $300/barrel oil as predicted at a DC meeting when ASPO went to Dept. of Energy to inform them soon oil would run out.

    An incredibly intelligent, concerned and from directly chatting with them an honest group of people who got it wrong, why, how?

    Dennis L.

    • People do not understand how networked systems work. They assume that “of course” we will run out of oil and prices will be high.

      There is a different way that we can get to the same end point: We can have more wage disparity, and as a result many fewer people can afford homes, cars, air conditioning, and many other devices that use energy prices in their production and in their ongoing operations. Prices can drop too low. The system can fail from too low prices. This was more or less the problem we were up against at the time of the Great Depression. This is what is happening again now.

      • Jan says:

        With a potatoe supply crunch the price rises. People understand this. But there is a second effect: Less potatoes are sold – of course, otherwise it wouldnt be a supply crunch. Now our highly paid government experts and sci-fi friends believe, that a high price for potatoes will also rocket caviar sales – because they are becoming competitive.

        Even the simplest pitchman knows, people buy more cabbage instead or go on a diet.

        If this is a question of understanding there is indeed not much hope for the human race…

        • DJ says:

          It is easier substitute potatoes than oil.

        • DJ says:

          Maybe wind power is our cabbage?

          Not our first choice, but keeps us alive a bit longer.

          • I am afraid wind is no substitute for oil. The economy just “makes a smaller batch” — really a smaller economy. It shuts down part of manufacturing and international trade. Our supposed substitutes aren’t good enough.

          • Jan says:

            I bet on diet.

          • NikoB says:

            Cabbage generates wind power.

          • DJ, great point. I guess it must be linked to some deep psycho condition of humanoids..

            Wind is seasonal, erratic, on occasions even beyond dangerous.
            Wind energy is an addendum to pre-existing base load grid system.
            Wind is way more expensive to install, maintain, connect to grid or microgrids w. batt packs etc.
            Still, people are fascinating that it works at all or in the most expensive variant (microgrids) it seemingly makes the outside baseload grid invisible for most of the year.
            Hence people get ecstatic.

            But if you suddenly don’t have the fallback option (to service it – high end parts) or to connect back to the grid, well..

    • Davidinamonthorayearoradecade says:

      “How did ASPO get it so wrong?

      There is no $300/barrel oil as predicted at a DC meeting when ASPO went to Dept. of Energy to inform them soon oil would run out.”

      I remember quite clearly that at that time there were other “intelligent, concerned” persons who thought that oil could never get that high (in the dollar value of those days)…

      it was a debate that seemed to last for quite a while…

      the other side of the debate thought that if oil ever started to approach even $200 then that would harm the economy because the energy in oil is within almost every part of IC…

      and then the price would come down because of the economic slowdown caused by the huge extra expense of the too-high-priced oil…

      so, the facts show that oil spiked to almost $150 in 2008 and then quickly plunged due to the predicted economic slowdown…

      so we do know who was right… 😉

      • From my hazy cloud recollection of those days I guess there were three major blocks of thought formed around that question, namely:

        1/ Hockey stick pricing for ever and or highly elevated plateau from now on
        2/ Return to realistic range bound snake (on way lower level to #1)
        3/ Demand constrained – very low even crashed price levels to be expected

        The options #2-3 were discussed, but formed minority in the forums community.
        Groups #2-3 (also active elsewhere) even involved one or two brainiacs openly boasting – predicting and betting on the ~2015 slump.. although the early hockey stickers moved more up previously (disregarding later slump losses if they did not get out on top).

    • Davidinamonthorayearoradecade says:

      so now the oilprice.com article has its own predictions:

      “Global oil markets will remain well supplied this year, with a possible overhang of some 1 million bpd, the head of the International Energy Agency, Fatih Bitol, told Reuters.

      Demand growth, however, will be slow, according to Birol. “We are expecting a demand growth of slightly higher than 1 million barrels per day,” the top IEA man told Reuters.”

      “This means that except sudden spikes in prices due to geopolitical factors or possible production outages in a major producer, oil prices this year will remain largely range-bound.”

      this is where OPEC/Russia can’t or won’t get serious about establishing production cuts to enable higher prices… they would have to cut by MORE THAN 1 million bpd to eliminate the oversupply…

      I think there’s a better chance that demand will be lower than he thinks, due to what appears to be a global economic slowdown, perhaps a global recession, depending on how statistics are compiled/manipulated…

      it’s probably going to be right that 2020 oil prices “will remain largely range-bound”…

      but the economic lessons of OFW tell us that oil prices will remain mostly in a low range, and that is where we are now with WTI at $59

      if ASPO back then could have realized the many downward economic pressures on oil prices, they would not have been so wrong…

      • Dennis L. says:

        My introspective question is “Why did they fail to realize?” “The Limits to Growth” is supposedly recursive and as such sort of self organizing, most of us read it, but we came to conclusions that did not work.
        US oil production is at an all time high, overall poverty is down, the wealthy who did not follow such ideas have more wealth than ever before and according to a report those making more than $500K are very happy and satisfied with their lives.
        Those who were optimists have happy, successful lives, those who thought the price of oil was going to the moon are grumbling and thinking doom and gloom is right around the corner – there have been a lot of corners these past fifty or so years.

        Dennis L.

        • Economists have been great evangelists for the view that prices rise in the case of shortage. They never considered that there are two different cases:

          1. When a necessary “ingredient” for the economy to function is missing or is in short supply.
          2. When an easily substituted ingredient for the economy to function is missing.

          Their high-price model works in the substitution case. It also tends to work in the very short term, when refineries, factories, and others have workers that they would need to lay off, in the absence of adequate commodity supplies. In this case, they have costs that are fixed in the short term.

          But if a high enough quantity of the right kinds of energy products cannot be found in a short enough time, the economy simply shrinks back. This is what collapse is all about. Economists cannot imagine the possibility of collapse.

          • Robert Firth says:

            Gail, once again classical economists knew all the above. This knowledge was captured by Liebig’s Law of the Minimum, actually enunciated by Carl Sprengel in 1840. Those interested can look it up. It was true then, and it is true today.

            As a modern example, the determining factor in developing wind power is neither the windmills nor the wind, but the transmission lines, the least available resource.

            • That is a good point about the transmission lines being the least available resource, and thus the limiting factor.

              With respect to plants, I think that Jevons was generally right. One catch is that this doesn’t mean that plants will necessarily have the right nutrients for humans who eat those plants. For example, plants don’t seem to need supplemental magnesium to grow, but humans need magnesium from water and/or plants. There are minor nutrients that plants can get along without, but perhaps humans require. At some point, there can be a “minimum nutrition for humans” problem, even if the plants seem to do adequately well.

    • to be able to afford $300 oil, you first have to burn $300 oil–ie the $300 oil has to be surplus in the first place,

      We no longer have that surplus.

      When oil hit $25, it was going to be the end of the industrial world. It wasn’t because we just pumped more oil —ie, we had ‘surplus’ to burn.

      When we paid $25, there was always more oil to create more wages with which to pay for more oil to be produced.

      which is what we did. Think of it as an upward spiral

      As king as production always kept ahead of burning, the system worked

      with oil at $300, production falls behind burning. Which is why that can’t work. The spiral is now running downward

  5. MG says:

    Humans are the highest energy apes, making us smarter—but also fatter


    For me, it is interesting that it is l-threonate that inhibits androgene alopecia:


    And it is magnesium l-threonate that regulates synaptic density and plasticity of the brain.


    That is why l-threonate seems to be responsible for our hair rich heads and better brains, i. e. as if more of it was concentrated in the head than in other parts of the body in comparison to apes.

    Does Alzheimer’s disease exist in all primates? Alzheimer pathology in non-human primates and its pathophysiological implications (I)




    “One important physical difference between humans and apes concerns human hair’s ability to grow ceaselessly.”


    • This is sort of a combination of articles about different things.

      It is interesting that humans have a significantly higher metabolism rate than other primates. It sounds like from the research that the various types of primates all had different metabolic rates, and humans came out on top. There had to be a number of changes to accommodate this change.

      The magnesium l-threonate seems to be available as a supplement from a number of sellers. There seem to be a few percent of buyers of all of the brands who have adverse reactions to its use.

      • MG says:

        Yes, the adverse reactions are present. Because it is about the correct concentration of magnesium l-threonate in the brain. Those who do not need to elevate the concetration of this stuff, have the adverse effects similar to taking memantine, which is a drug prescribed to Alzheimer’s patients, when they not need it. The adverse reactionw can be felt like brain fog etc.:


        But I wanted to point out to the connection between the neverending hair growth on the human head and the synaptic density and plasticity increase together with beta amyloid deposition reduction (see the picture here: https://www.neurocentria.com/research) which magnesium l-threonate exerts.

        There simply must be something that connects these 2 characteristics of the human head and the research points out to this stuff.

        The humans differ from apes in the delayed synaptogenesis. The process of synaptogenesis may be the key difference between the humans and the apes:


        “Our results suggest that delay in cortical synaptogenesis, extending the period of synapse formation to over 5 yr in humans from a few months in chimpanzees and macaques, could be a potential mechanism contributing to the emergence of human-specific cognitive skills.”

        And it is the concentration of magnesium l-threonate that regulates synaptic plasticity and density. Higher levels of l-threonate prevent head balding, too.

        Is it just some coincidence?

        • NikoB says:

          One would expect bald men to be less intelligent or have lesser brain plasticity if there was a link.

        • Xabier says:

          So much minute and careful research into the brain (the ecosystem, etc,), while all around us the poisons and decay continue build up, unstoppably, until our civilization is gone – such irony!

          As if one died and went to Hell and thought that the best thing to do was to map it, and that it would help one find a way out…..

          The cleverest and most foolish animal on the planet.

          • Robert Firth says:

            Xabier, you enter Hades by crossing the River Styx, ferried by Charon. And there you are judged. If righteous, you may return to the living world across the River Lethe. But you must swim across, and if you drink of the water, you forget your previous life. Thereby learning nothing. And so turns the wheel of Tyche.

        • Interesting study! I am not sure I understood all of it.

          • MG says:

            Environmental enrichment combined with meantime or magnesium l-threonate works as therapy for Alzheimer’s.

            “Environmental enrichment and MgT may synergistically improve recognition and spatial memory by reducing synaptic loss and restoring the NMDAR signaling pathway in AD mice, which suggests that combination of EE and MgT may be a novel therapeutic strategy for AD.”

            The impact of the environment on the formation of the human brain seems to be profound.

        • TY says:

          Intersting you mention this; i’ve just discovered recently myself that maybe magnesium l-threonate may be of benefit to improve cognitive performance and sleep as well and have recently started testing it.
          Unlike many food supplements, it does appear to have some effect, at least it does feel like it’s “doing something”.

  6. MG says:


    “Bald men are typically older, and tend to be seen by women as more intelligent and wiser, according to a separate study conducted at the University of Saarland.”


    “And another study at the University of Saarland found bald men tend to be seen by women as more intelligent and wiser. However there is a catch. You have to be completely bald for the perception to apply – with men with bald spots or patterned baldness seen as weaker.”

    The baldness is a sign of ageing and ageing is connected with aquired wisdom. Maybe it is just this visual deception, not the reality.


    “Maybe bald men can thank prominent bald actors like The Rock, Bruce Willis, and Vin Diesel for demonstrating that bald men can still ooze sex appeal. This study reported that bald men were viewed as more manly and strong.”

    • Dennis L. says:

      Since JFK, name one US president who was bald; in the second half of the twentieth century only two presidents were bald, Eisehower and Trumann.

      So Enquiring minds want to know and here are some ideas:


      Back to leaders, how many male heads of state are bald? How many male heads of Fortune 500 Companies are bald? I don’t know, but it would seem that this sort of data would be superior to asking people how they feel as opposed to how things actually work out. Okay, how about this?


      The studies listed might show more seeking of affirmation than information.

      Dennis L.

      • DJ says:

        Why drag presidents into a discussion about intelligence?

      • Davidinamonthorayearoradecade says:

        “Back to leaders, how many male heads of state are bald? How many male heads of Fortune 500 Companies are bald?”

        I don’t know…

        but I love the subtle humour in those questions… 😉

      • Tim Groves says:

        In the US, baldness has a negative image with connotations of old and past it or weak and never had it, and therefore many many powerful male figures in politics, business and the media have worn toupees. This is what is known as a shabby cover-up.

        Generally in Europe, where they think about things differently, baldness is a sign of virility and maturity, hence the lack of embarrassment about possessing a shiny dome. Although fear of baldness affects game-show hosts everywhere.

        • Davidinamonthorayearoradecade says:

          except in Parliament, where they wear those outrageous wigs?

          is or isn’t that ironic?

          • Tim Groves says:

            More anachronistic than ironic, IMHO.

            The fashion for wigs in Europe was huge in the 17th century when in addition to being fashion essentials for “big wigs”, they served a practical purpose in keeping heads warm during the depths of the Little Ice Age.

            What they are still doing colonizing the heads of members of the House of Lords and of high court barristers and judges in the age of central heating is beyond me.

    • Robert Firth says:

      So if I shave my head I can pick up hot chicks by the dozen? Sorry, MG, but in my (old and cynical) view, most US women are interested in only one thing: the size of a man’s sex organ. The name of that organ? The wallet.

  7. Harry McGibbs says:

    “…a low mortgage rate environment is important in keeping housing conditions in good shape. The Federal Reserve has played its part by slashing interest rates. But the problem is that stagnant wage growth and consistently rising home values [due to supply pressures] could price buyers out of the market.”


    • Harry McGibbs says:

      “Scott… is a marketing manager for a health and beauty company based in nearby Provo, Utah. Though he earns around $60,000 annually — about 20% more than his dad did at his age — he is living with his parents, because he doesn’t feel he can afford to buy a place of his own thanks to soaring housing prices.”


      • This is a chart from the CNN article:

        I am surprised that the percentage is as high as 50%. Perhaps a disproportionate share of the children are children of recent immigrants. In the fine print, the chart mentions comparing parents and children at about age 30.

    • As the article says, “. . . buyers could start pulling out as supply remains scarce, prices rise, and wage growth remains weak.”

      My daughter tells me about the problems that her friends in the Boston area have run into when they buy expensive, old homes. These old homes often need expensive repairs. Some of her friends have sold and moved back into apartments. She is in no rush to buy a home. She and her spouse would think about buying a home, only if buying in a home was needed to help lock in a school district for a child.

      Educational attainment in the US seems to vary a whole lot, based on the education of parents. A major reason for buying a home seems to be to lock oneself into an area where other parents are educated and can afford to buy homes. Schools seem to vary a lot, by school district; they are mostly paid for by local property taxes. If there are no children involved, or if they are only of preschool age, the pressure to buy a home is much lower. Quite a few US families seem to home-school, partly because of school issues.

      • Artleads says:

        Without mainstream-type experience, I don’t know if I have this right. I experiment with “repairing” my old house. I certainly don’t do it conventionally, but use what is at hand, much of it being discarded paper (for pulp) mixed with discarded paint (for adhesion, rain fastness, etc.) Since I have no interest in selling the property, I’m not involved with mainstream aesthetics. There is a whole lot I can’t do–electric, plumbing, etc.–but I try to do things to barter for the expertise. It’s not a perfect system, but it tends to keep the house standing without a lot of money.

    • Robert Firth says:

      Harry, the comment you quote seems to me exceptionally stupid, even for an economist. Low mortgage rates simply trigger a bidding war, as potential buyers feel able to borrow even more money. This raises the price of housing, and nobody really wins anything. In addition, lower rates in the longer term reduce the surplus available for builders to invest in new houses, so creating a shortage. If left to itself, the free market will find a balance among these competing interests, but today there is no free market.

      Many people sympathise with Shakespeare’s remark “kill all the lawyers” (Henry VI, Part 2, Act IV, Scene 2). Maybe today we should amend that to “kill al the economists”.

      • Customers with falling discretionary income can afford lower and lower monthly payments for homes. And fewer customers, in total, can afford to buy homes. There may be a bidding war, but only among a relatively small number of folks whose income comes from ever-rising stock prices and building prices. Ordinary folks, getting their income entirely from wages, find themselves dealing with higher costs of education and medical insurance, bringing down their discretionary income.

        Economists recognize that in such a situation, about the only band-aid they have available is extremely low interest rates–preferably lower than they were in the past–together with very long amortization periods, to keep monthly payments as low as possible.

        • Robert Firth says:

          Thank you, Gail. As you might guess, I respectfully disagree. First, why do economists feel they need to rush in with a “band aid”? They are not part of the solution; they are part of the problem, and should quietly go away. Secondly, they are trying to solve a liquidity problem by making people take on more debt, for longer terms. That will merely exacerbate the problem.

          The solution to expensive housing is more supply. And the way to achieve that is first, to ensure the house builders enjoy more income, and secondly to remove many of the legal and bureaucratic obstacles to house building. In other words, to relinquish control, and let the free market work.

          Which they will never do, because as William Burroughs once wisely remarked: “Control is never a means to any useful end. It is a means only to more control.”

          “Let us break their bands asunder, and cast away their cords from us.” (Ps ii:3)

  8. Harry McGibbs says:

    “Yet again, the Fed and other major central banks have helped to extend the global expansion by adding stimulus in response to rising recession risks. However, last year’s easing of monetary policy comes at a price: Whenever the next economic downturn or major risk market drawdown hits, policymakers will have even less policy capacity to maneuver, thus limiting their ability to fight future recessionary forces.”


    • Harry McGibbs says:

      “Companies across the globe took advantage of lower borrowing costs to sell a record amount of bonds in 2019, prompting renewed concerns among policymakers about soaring levels of debt.

      “Central bank policy has played a significant role in what’s happening,” said Asif Sherani, a managing director in debt syndicate at HSBC in London. “It is clearly contributing to the surge of corporate issuance.”

      “The record debt sales highlight tensions between policymakers’ desire to keep the cost of borrowing low in an attempt to stimulate economic growth, while at the same time sounding the alarm over rising corporate indebtedness.”

      “The trend has shown little sign of abating in 2020…”


  9. Harry McGibbs says:

    “Manufacturers will be hoping for a turnaround in fortunes in 2020…

    “It’s unlikely there will be a marked improvement globally. World trade growth will continue to move along at a glacial pace, increasing by 1.7%, but GDP growth will decelerate to 2.4%, down slightly from 2.5% this year. Insolvencies… will … remain at an uncomfortably high level.”


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