Recently, a new coronavirus has been causing many illnesses and deaths. The virus first became active in Wuhan, China, but it has already spread to the rest of China. Scattered cases have been identified around the rest of the world as well.
There are two important questions that are already being encountered:
- How much of an attempt should be made to limit the spread of the new virus? For example, should businesses close to prevent the spread of the virus?
- Should this disease be publicized as being far worse than flu viruses that circulate each year and cause many deaths among the elderly and people in poor health? The median age of those dying from the new coronavirus seems to be about 75.
Unfortunately, there aren’t easy answers. We can easily see the likely outcome of under reaction. More people might die of the disease. More people might find themselves out of work for a couple of weeks or more with the illness. We tend to be especially concerned about ourselves and our own relatives.
The thing that is harder to see is that reacting too vigorously can have a hugely detrimental impact on the world economy. The world economy depends on international trade and tourism. China plays a key role in the world economy. Quarantines of whole regions that last for weeks and months can have a very detrimental impact on the wages of people in the area and profits of local companies. Problems with debt can be expected to spike. The greater the reaction to the coronavirus, the more likely the world economy will be pushed toward recession and job loss.
The following are a few of my thoughts regarding possible overreaction:
[1] The Chinese coronavirus seems to be extremely contagious, even before a person who has been exposed shows any symptoms. The only way we can be certain to contain the virus seems to be through quarantines lasting up to 14 days.
China’s National Health Minister, Ma Xiaowei, has provided information that seems quite alarming. With the new virus, a person may become communicable shortly after he/she has been infected, but symptoms may not appear for up to 14 days. This allows the infected person to infect many others without realizing that he/she is a carrier for the disease.
Today, the United States and many other countries screen for the virus by checking passengers arriving on planes from affected areas for fevers. Given the information provided by China’s National Health Minister, this approach seems unlikely to be sufficient to catch all of the people who may eventually come down with the disease. If a country really wants to identify all the potential carriers of the disease, it appears that a 14-day quarantine for all travelers from infected areas may be needed.
Such a quarantine becomes administratively difficult to handle for the huge number of people who are likely to travel from China. Such a quarantine would make it impossible for pilots and other airline workers to make a living, for example. They would be spending too much of their time in quarantine to do the work needed to support themselves and their families.
A related concern is that person-to-person transmission is very easy with the Chinese coronavirus. We don’t know for certain how many people each infected individual infects, but one estimate is that each infected person transmits the disease to an average of 2.5 other people. With this transmission rate, the number of people having the disease can be expected to grow exponentially, perhaps for several months.
Based on these concerns, it seems to me that funds spent on trying to contain the coronavirus are likely to be largely wasted. The new Chinese virus will spread widely, regardless of attempts to contain it. At most, quarantines will slightly slow the transmission of the disease. At the same time, quarantines will be quite disruptive of commerce. They will tend to reduce both total wages and total output of goods and services of the area.
[2] Deaths from pathogens are part of the natural cycle. They help prune back the population of the old and weak.
We know that in ecosystems, one of the functions of naturally occurring fires is to clear out “deadwood,” to allow healthy new growth to occur. In fact, some types of seeds seem to require smoke for germination. When inadequate natural burning takes place, bushfires as seen in Australia and forest fires as seen in California become an increasing problem.
Deaths from pathogens seem to play a similar role in human economies. This is especially the case with pathogens that especially target the weak and old. Most flu viruses have this characteristic. Early reports of deaths from the coronavirus suggest that this same pattern of targeting the old and weak is occurring with this virus as well. As noted above, the median age of those dying from the new coronavirus seems to be about 75 years.
Since the 1940s, modern medicine has been able to develop antibiotics and vaccines to counteract the impact of many pathogens. This, of course, makes citizens happy, but it has the disadvantage of changing the population in a way that leaves the economy with a much higher percentage of elderly people and others in poor health. This higher level of elderly and medically needy people makes it easy for viruses and other pathogens to make their rounds, just as leaving deadwood on the forest floor makes it easier for fires to spread.
With this rising population of people who cannot support themselves, tax rates for the remaining citizens tend to become very high. Young workers may become discouraged because they do not have enough income remaining after paying taxes to raise their own families. In effect, they cannot support both their young families and the many old people.
Viewed from this unusual perspective, the operation of the Chinese coronavirus might even be considered a benefit to society as a whole. The world has overcome the impact of measles, typhoid, polio, and many other diseases. In some sense, it “needs” a new disease added to its portfolio, to replace the ones that have been mostly taken care of by modern medicine. In this way, pensions and other payments targeting the old and weak don’t become too great a burden on the young.
[3] If the Chinese coronavirus were simply allowed to run its course, without publicity that it was in any way unusual, somewhat less than 1% of the world’s population might be expected to die.
To see what would happen if the Chinese coronavirus were to run its course, we might look at what happened with the Spanish Flu, back in 1918. At that time, doctors did not have a way of treating the virus and authorities downplayed concern for the disease. The US Center for Disease Control reports that 500 million people, or one-third of the world’s population, became infected. At least 50 million people (about 10% of those infected) died.
We don’t yet know with accuracy how many of those infected will die from the current virus. A recent estimate is that about 2.3% of those who are infected will die of the disease (based on 107 dying out of 4,600 infected). If we assume that the percentage of the population that will ultimately catch the new virus is 30%, then the share of the world’s population that would be expected to die would be about [(1/3) x 2.3% = 0.76%].
The UN estimates that the world’s population can be expected to grow by about 1.05% in 2020. If this is the case, the effect of the Chinese virus would be to sharply dampen the population increase for the year. Instead of population rising by 1.05%, it would rise by only 0.29% (= 1.05% – 0.76%), assuming all of the deaths associated with the Chinese coronavirus take place within a year. While this would be a change, it would be a fairly small, temporary change.
All of these deaths would be tragic for the families involved but, in a way, they would be less of a problem than the deaths that took place back in 1918. At that time, mortality was high for healthy 20- to 40-year olds, making the flu particularly disruptive for families. The total percentage of the population that died was also much higher, about 3% instead of 0.76%.
[4] A major danger of the virus seems to be one of overreaction.
Today’s world economy is fragile. China, like other countries, has a large amount of debt. Debt defaults related to poor profits of companies closing their operations for a time and workers losing income could easily skyrocket.
Closing down transportation from China would risk pushing the world economy into a very bad recession. In fact, simply having a very large number of people out sick from work would be expected to have an adverse impact on the economy. Spending a large amount of money on hospitalizations and face masks cannot compensate for the loss of productivity of the rest of the economy. Thus, the tendency would be toward recession in China, even if no action toward cutting off travel were taken.
China is a huge supplier of goods to the rest of the world. In fact, in 2016, it used more energy in producing industrial output than the United States, India, Russia and Japan combined.
Figure 1. Chart by the International Energy Agency showing total fuel consumed (TFC) by industry, for the top five fuel consuming nations of the world.
China’s economy has been growing very rapidly since 1990. Figure 2 shows this one way, in GDP comparisons using inflation-adjusted US dollars.
Figure 2. GDP of China and the United States, computed as percentages of World GDP. All amounts in 2010 US dollars, as provided by the World Bank.
Figure 3 is similar to Figure 2, except the growth comparison is made in “2011 Purchasing Power Parity International Dollars.” This adjustment is made because typically the currencies of less developed nations float far below the dollar, in terms of what the local currency will buy. The inflation-adjusted PPP comparison compares output on a basis that is expected to be more consistent with what the local currency will really purchase.
Figure 3. Ratios of the GDP of China and the United States to the World GDP. All amounts in 2011 Purchasing Power Parity International Dollars, as provided by the World Bank.
On this PPP basis, China’s GDP surpassed the US’s GDP in 2014. Figure 3 also shows that the United States has slipped from about 20% of the world’s GDP to about 15% on this basis.
We cannot simply cut off trade with China, regardless of how bad the situation is. China is too big and too important now. The rest of the world desperately needs goods and services produced in China, in spite of what is going wrong from an illness perspective. China plays too key a role in supply chains of many kinds for the country to be left out.
Even cutting off tourism becomes a problem. The share of China’s revenue from tourism amounted to 11% in 2018. While not all of this would drop off, even a dip would lead to lower employment in this part of its economy. Jet fuel use would drop as well.
[5] A particular problem today is low prices for many commodities, including oil and other fossil fuels. These prices are likely to fall further, if China’s economy falters further.
We used to hear that the world would “run out of” oil and that oil prices would rise very high. In fact, if the people who were concerned about the issue had studied history, they would have figured out that a far more likely outcome would be “collapse.” In such a situation, prices of many commodities might fall too low. Revelation 18:11-13 provides a list of a number of commodities, including humans sold as slaves, for which prices dropped very low at the time of the collapse of ancient Babylon.
The problem is a different squeeze than a high-price squeeze. It is more of a growing wage disparity problem, with fewer and fewer of the world’s workers being able to afford the goods and services made by the world economy. This problem feeds back to commodity prices that fall too low for producers of many types. The problem is an affordability issue, rather than one of running out. I have written about this issue many times.
Prices of fossil fuels have been low for a very long time–essentially since late 2014. OPEC has cut back its oil production because of low oil prices. Several US natural gas producers have taken big write offs on natural gas investments. China’s coal production has remained below its 2013 level, because of low prices.
Figure 1. China energy production by fuel, based on 2019 BP Statistical Review of World Energy data. “Other Ren” stands for “Renewables other than hydroelectric.” This category includes wind, solar, and other miscellaneous types, such as sawdust burned for electricity.
If China finds it necessary to cut back on production of goods and services for any reason (excessive sickness within China, visitors aren’t traveling to China, tariffs, customers around the world aren’t buying cars), this reduction in output would be likely to further lower the prices of commodities. More producers would go bankrupt. Countries exporting products as diverse as oil, iron ore, copper and lithium might have economic difficulties.
Lower fossil fuel prices may lead to a cutback in their output, but it is doubtful that this cutback would be offset by an increase in the production of renewables. Falling fossil fuel prices would make the price comparison of renewables to fossil fuels look even worse than it does today. China has cut back on its subsidies for solar panels, and this has led to decreasing Chinese solar installations in both 2018 and 2019.
[6] The best approach might just be to let the Chinese coronavirus run its course. Authorities might also discourage stories about how awful the illness is.
Today, we seem to think that we can fix all problems. Unfortunately, this medical problem doesn’t seem to be fixable in the near-term. We should probably do as governments through the ages have done, which is not very much. We should not publicize the disease as being a whole lot worse than flu viruses in general, for example.
We should certainly look for inexpensive treatments for the disease. For example, there seems to be an effort to examine the possibility of using existing antiviral drugs as a treatment. It seems like an effort could be made to look into ways of treating the disease at home, perhaps using supplemental oxygen for a period. In time, perhaps a vaccine can be developed.
Individuals around the world should be encouraged to get themselves in as good health as possible, so that their own immune systems can fight off pathogens of all types, not just this particular virus. Common sense should be used in washing hands and in avoiding being with sick people. I doubt that it makes sense to encourage the use of masks, goggles and other protective devices.
We, as individuals, cannot live forever on this earth. We also cannot spend an unlimited percentage of GDP on health care: It becomes too high-cost for most citizens. At some point, we need to call a halt to the expectation that we can fix all problems. We live in a world with limited resources. We need to start lowering our expectations, if we don’t want to make our problems worse.
“The year 2020 could emerge as the start of the era of relative global chaos or major upheaval. It is the era we have been anticipating, as the impact of core population decline meets economic dislocation, and security and structural uncertainty…
“A sense of “social distress” is likely to become exacerbated in major urban societies as the economic decline of the PRC begins to bite the global economy. This will further polarize societies…”
https://oilprice.com/Energy/Energy-General/Brace-For-A-Global-Crisis-In-2020.html
I am afraid this fellow is right. The People’s Republic of China will cause a global crisis this year.
The government of Finland has basically come the same conclusion as Gail. They have written a scientific report about the end of oil and the end of our current civilization.
https://www.vice.com/en_us/article/8848g5/government-agency-warns-global-oil-industry-is-on-the-brink-of-a-meltdown
The peer-reviewed report calls for the European Commission to consider oil as the world’s most important “critical raw material.” Despite offering a scathing critique of conventional peak oil theory, the report arrives at the shock conclusion that the economic viability of the entire global oil market could come undone within the next few years.
Oil, oil everywhere, too costly to drill
The plateauing of conventional crude oil production in January 2005 was one of the triggers of events leading to the 2008 global financial crash, according to the report. As debt built-up in the subprime mortgage sector, the crude oil plateau drove up the underlying energy costs for the entire economy making that debt more difficult to repay—and eventually resulting in catastrophic defaults. The report warns that “unresolved” dynamics in the global energy system were only temporarily relieved due to “Quantitative Easing”—the creation of new money by central banks. A correction is now overdue, it warns.
Our Finite World is no longer a fringe site where doomers hang out.
These ideas are now discussed at the highest lever of power in the EU.
…highest level…
Yoshua, that should be “the highest level of *political* power. Which emphatically does not translate into power over Nature. EROEI is the earthquake (or tsunami) that will sweep away industrial civilisation. I suspect that those highest levels of power are plotting hard to ensure that they will be the last people standing, after the storm hits. Of course, they will fail.
Well…at least the ones at the highest level of political power are now thinking about their own survival.
I mentioned in an earlier comment that the author of the report sent me an early version of the report to review. The earlier version was written from a very standard, “We will run out of oil and prices will explode,” point of view. I corresponded with him and convinced him that this was not really the way things worked.
He then rewrote the report in its current version. He also made a comment on Facebook saying that his discussions with me convinced him to change his report before it was finalized.
No wonder that he then “came to the same conclusion” as you.
Hm, the ~2005 plateauing of the conventional sources was discussed by the early PO circles in the mid-late 1990s. One particular oily obsessed faction even got into government ~5yrs before and after one year in office had to deal with defying peculiar geopolitical event. Afterwards feeling threatened by foreign powers in foreign lands (lolz) several of these bad guys got toppled. After that bravery the Spice continued to flow and imagine that even denominated in the same currency system.
All mere coincidences happening at random as always..
Gail or others:
This just out by Martenson, he received a model from someone and it appears as though the numbers being reported follow this model, i.e. today’s numbers came from a model available yesterday. Oh that we had such models for the financial industry! Relevant part begins at 3 minutes in.
https://www.youtube.com/watch?v=yV6IEdPc7AY
Dennis L.
Interesting video! Actually, disturbing video.
Chris Martenson presents pretty strong evidence that the data about China we have been given is completely made up. First, he shows the results of a model, which more or less goes along with the total number of China numbers reported.
What is more disturbing is number of reported illnesses and deaths by province (like states)
https://gailtheactuary.files.wordpress.com/2020/02/ridiculous-looking-death-statistics-feb-4-2020-c.-martenson.png
It is totally impossible that there could be as many reported illnesses as they show, and no deaths. The numbers must be completely made up. We don’t have any idea what the right numbers are.
Chris also shows evidence that today’s stock market is the result of market manipulation. Basically, some unknown group (Plunge Protection Team) started as the close of markets yesterday, buying up shares in the futures market for this morning. Prices went up, a lot, in all major markets today, including China.
https://gailtheactuary.files.wordpress.com/2020/02/evidence-of-market-manipulation-feb-4-2020-c.-martenson.png
But this is pretty much what “everybody” expected would happen. No one wanted the market to be down terribly.
I am thinking that even the “Scientific Papers” we have been given may be completely made up, as well as the age distribution of the earliest people who died. We basically don’t know anything about what has happened in China, except that it is a lot worse than they have been telling us.
I wonder if they wanted Trump to look good because of the State of the Union tonight?
The latest numbers just released now match the models predictions.
model infected 23803 deaths 499
today china infected 23718 deaths 491
It is looking very much like bogus reporting.
I discovered in corresponding with some people that I know in Beijing that they were seeing the same numbers that we are. I would think that the numbers are being prepared as much for internal use within China as for external reporting.
On the subject of how many have the virus, here’s an interesting article/link:
https://www.bloomberg.com/news/articles/2020-02-05/coronavirus-update-governments-prepare-for-pandemic
“One set of researchers from the University of Hong Kong estimated in the Lancet, a medical journal, that there were more than 75,000 cases in Wuhan as of Jan. 25, with cases doubling every 6.4 days.”
“Another group estimated that only 5% of cases in the outbreak’s center in Wuhan have been identified. This group, led by researcher Jonathan Read, from the Center for Health Informatics, Computing and Statistics at Lancaster Medical School in the U.K., estimated that more than 100,000 people in Wuhan were infected by Jan. 29”
“What makes the new coronavirus hard to stop is that it is somewhat between the common cold, which is often caused by coronaviruses, and SARS in severity.
Just so readers understand, it’s an epidemic right now because it’s mostly in one country, China, but if it proliferates in huge numbers globally, then it’s a pandemic.
On Virology Today
http://www.microbe.tv/twiv/
A little different perspective.
I follow Martenson– but the data from the virologists seem to conflict a bit.
The pros often have a greater perspective.
Please elaborate on the differences.
Okay, I am listening to them, they bring out influenza with 16,000,000 cases, 140,000 hospitalizations, and 8200 deaths. By the CDC website this is a yearly estimation going back to 2010.
Please check my math, but 140,000/16,000,000 = .875 percent and 8200/16,000,000 =
.05125 percent.
Looking at Martenson’s data there are 426 deaths/20528 cases which is 2.075% or 40x more deaths/hospitalization or contracting the disease. If we further assume this coronavirus disease has been going on one month, then multiplying 8200 deathsx12= 98,400 deaths annually is a death rate greater than one order of magnitude that of influenza. This assumes the rate remains the same and does not follow the curve as presented by Martenson.
Duncan, I have no idea and your perspectives would be welcome.
Thanks,
Dennis L.
Origins– Martenson believes a snake origin, the pros don’t (96% same as SARS bat origin). Some other minor things—–
They are essentially on the same page.
An aljezeera China Coronavirus Outbreak update gives the following information, among other things:
Great analysis as always Gail! Thanks for all of your hard work and insight.
By Hiroko Tabuchi
China Cuts Rates, Injects Liquidity as Mainland Markets Sink
Bloomberg) — Terms of Trade is a daily newsletter that untangles a world embroiled in trade wars. Sign up here.
China’s central bank took its first concrete steps to cushion the economy and plunging markets from the blow of a spreading new virus, providing short-term funding to banks and cutting the interest rate it charges for the money.
The People’s Bank of China added a net 150 billion yuan ($21.4 billion) of funds on Monday using 7-day and 14-day reverse repurchase agreements. The rate for both was cut by 10 basis points, driving down the cost of the money to “ensure ample liquidity during the special period of virus control,” it said in a statement. PBOC adviser Ma Jun indicated he expects further rate cuts later in the month.
The cash injection was part of a raft of supportive measures announced over the weekend to soften a market sell-off and help firms affected by the disease outbreak and extended holiday. While the government said Monday that it’s confident it can minimize the economic impact of the coronavirus, the central bank and regulators may well continue to step up support as the effects of the epidemic become clearer.
https://finance.yahoo.com/news/china-cuts-rates-adds-cash-015233259.html
A little help from your friends…to get by
https://m.youtube.com/watch?v=awBy_K30Pe8
BAU is BOOMING!
Swansy Afonso
BloombergFebruary 3, 2020, 10:25 PM EST
(Bloomberg) — India’s steel industry is set to more than triple its carbon footprint by 2050 as demand for the metal in the world’s second-biggest producer soars.
Carbon dioxide emissions from the steel industry are projected to jump to 837 million tons over the next three decades from 242 million tons now as India’s demand for steel more than quadruples to about 490 million tons, The Energy and Resources Institute said in a report. It will also contribute more than a third of the nation’s total fossil fuel combustion emissions from 12% currently.
India currently has 977 steel plants and is one of the few brights spots for demand globally as Prime Minister Narendra Modi’s administration rolls out a plan to spend about $1.5 trillion to upgrade and build infrastructure over the next five years. Steel is the biggest carbon dioxide emitter among Indian industries.
“If India is serious about mitigating carbon dioxide emissions to prevent the worst effects of climate change, then serious action needs to be taken in the iron and steel sector,” Will Hall, associate fellow at TERI, said in an emailed reply to Bloomberg. “While there has been great success in the electricity sector with the growth of wind and solar, action in heavy industry, like iron and steel, will be more challenging.
Whatever it takes Guys! Burn more COAL!
New York Times
By Hiroko Tabuchi
Ms. Tabuchi went to Yokosuka, Japan, to examine a controversial decision to invest heavily in coal.
Feb. 3, 2020
It is one unintended consequence of the Fukushima nuclear disaster almost a decade ago, which forced Japan to all but close its nuclear power program. Japan now plans to build as many as 22 new coal-burning power plants — one of the dirtiest sources of electricity — at 17 different sites in the next five years, just at a time when the world needs to slash carbon dioxide emissions to fight global warming.
“Why coal, why now?” said Ms. Kanno, a homemaker in Yokosuka, the site for two of the coal-burning units that will be built just several hundred feet from her home. “It’s the worst possible thing they could build.”
Together the 22 power plants would emit almost as much carbon dioxide annually as all the passenger cars sold each year in the United States. The construction stands in contrast with Japan’s effort to portray this summer’s Olympic Games in Tokyo as one of the greenest ever.
Who is nominated for a Noble Peace Prize? LOL
India and Japan have both figured out that wind and solar really are not options for powering industry. And decarbonizing the steel industry is basically nonsense. China had already pretty much figured this out, as well, before it ran into its coronavirus problems. With China seeming to stall out, we need more help from Japan and India.
It is hard to convince the Japanese people that nuclear power is an option for the future after Fukushima, because Japan is very much subject to earthquakes and tsunamis. Japan’s nuclear power plants are getting old, as wells and there is very little practical to do with spent fuel. Coal tends to be the cheapest fuel available (although imported coal will be more expensive); cheap is important for making goods that are competitive in international trade.
It is the green group that is behind on their stories.
Dear Gail,
you say …”and there is very little practical to do with spent fuel”.
According to Copenhagen Atomics and Seaborg Technologies new type of reactors under development use spent fuel rods (waste):
https://www.copenhagenatomics.com/#radically
This has been discussed here for years and most recently at depth on the Surplus blog.
These are not under development they are already moving onto industrial scale usage in Russia, they would probably even sell license out, well under different political climate.
France and US abandoned similar R&D decades ago.
It’s complex, you need reprocessing facility for the spent fuel mix and new type of NPP to run it, the so called fast breeder reactor.
The US&UK seem now preoccupied instead with the small form factor (modular) reactors by RR (UK navy contractor), it’s obviously less efficient and needs large volume orders to make it at least somewhat viable.
I guess it was Kulmthestatusquo and me saying these are likely pushed by the global oligarch class to eventually get their ~40-60yrs private compound “home generator” style units, and break “easily” away from the unwashed masses (blackouts) during the next techno feudalism stage..
France evacuated 250 individuals from Wuhan 36 showed symptoms, or over 10 percent.
https://www.channelnewsasia.com/news/world/wuhan-novel-coronavirus-france-china-evacuated-symptoms-12385188
Wow! I didn’t see that. Evidently, a large share of those showing symptoms are not ending up in hospitals at this time.
At this point, we don’t know whether the symptoms these people are showing are from the new coronavirus or something else, such as a common cold or the flu. Tests are still being run on the French people. The others were flown to the their home countries, to be evaluated and treated.
China is a ghost town right now. They are definitely lying and hiding the truth about this virus. Their actions are telling that this is really bad.
Chinese actions are indeed strange.
Yoshua… flu or no flu? I hope you are well…
yes, based on the unprecedented actions of China, this is worse than anything in the past…
a little worse, moderately worse, far worse?
in time, the survivors will finally know…
Coronavirus is bad timing for Hong Kong:
“The Hong Kong economy’s first recession in 10 years deepened in the fourth quarter of last year weighed down by often violent anti-government protests and the protracted trade war between the United States and China, advanced estimates showed on Monday.”
https://www.aljazeera.com/ajimpact/hong-kong-fell-deeper-recession-2019-200203084830989.html
Hmmm well the Stock Market is at Record highs! Up 500 points…maybe this thing will blow over I guess….The U.S stock market will continue to rise as the rest of the world invest in the United States as a country of last resort. This thing is bigger than just energy it is now about market manipulation. How can any of Gails predictions be accurate when so much of the information these days is easily and readily manipulated? I would have more confidence in her data if she had access to secret information but for the most part she is working half blind trying to figure out what is going on. Does anyone really know what the FED is doing? No they do not….and that in itself makes any kind of prediction impossible.
I sometimes wonder if a lot of doomer on here are in the twilight of their lives and they are manifesting that onto world events in sort of an egoistic delusion. Average age of doomer 60+ is my guess….I still don’t think the conovirus is that big of a deal….waiting for the bridge to collapse and it still going strong!!
I think that the Plunge Protection teams and all of the added liquidity are doing their thing. Don’t let anyone worry!
The fact that much of the US has had a mild winter enters in as well. It keeps production higher in January. The seasonal adjustments fix January more than they really need to.
Doomers do tend to be disproportionately older, I agree. They have lived long enough and heard enough stories from their parents to have more of a perspective on things. People who are no longer working full time have more time to spend on the subject, as well.
Not sure if you have seen this article yet but it does follow your thoughts over the years as to oil prices being too low for production and too high for consumption. I just don’t have much faith in how renewables are going to save the day. (Maybe its just the doomer in me).
https://www.vice.com/en_us/article/8848g5/government-agency-warns-global-oil-industry-is-on-the-brink-of-a-meltdown
Thanks for the link.
The article you link to is by Nafeez Ahmed. He in turn links to a report by Simon Michaux who is Senior Scientist for Geological Survey of Finland.
The Nafeez Ahmen report says:
If some of this sounds a little familiar, it is because I reviewed an early version of Michaux’s report. I convinced him that the standard peak oil story about running out of oil and high prices was wrong. Michaux went back and rewrote the report. He put up a Facebook comment, crediting me with his change of view on how the story would end.
The article by Ahmed gives several quotes from Nate Hagens, whom many of us remember from Oil Drum days, and from his recent videos. Nate says that what Michaux writes is plausible.
Michaux’s employer had him find several reviewers, so his report is considered a “peer reviewed report.”
Congratulations..
Must be because The Guardian won’t take any FF advertising anymore: saving the whole world by bringing the FF industries down, starving the beast, etc!
yes, Walt, thanks…
“In short, we have entered a new era of expensive energy that is likely to trigger a long-term economic contraction.”
yes, this is absolutely true…
where the article dared not go is to the realistic conclusion that this “long-term economic contraction” will last for many decades…
very excellent summary article, except for the weakness of Ahmed who suggests that “renewables” are the answer, when in fact “renewables” will get progressively less affordable along with every other part of IC…
“I now see peak oil as being defined by a contracting window between an oil price high enough to keep producers in business and a price low enough for consumers to access oil derived goods and services,” said Michaux.
this quote is a gem!
we may have known this beforehand, but I really like the way he frames it…
the window is closing on economic growth… the world is undergoing The Great Turning from centuries of growth to “long-term economic contraction” which will essentially be a permanent part of the rest of this century and beyond…
From the article:
«The lesson is that even if collapse is imminent, all may not be lost. Systems theorist Jeremy Lent, author of The Patterning Instinct, draws on the work of the late University of Florida ecologist C. S. Holling, whose detailed study of natural ecosystems led him to formulate a general theory of social change known as the adaptive cycle.
Complex systems, whether in nature or in human societies, pass through four phases in their life cycle, writes Lent. First is a rapid growth phase of innovation and opportunity for new structures; second is a phase of stability and consolidation, during which these structures become brittle and resistant to change; third is a release phase consisting of breakdown, generating chaos and uncertainty; the fourth is reorganization, opening up the possibility that small, seemingly insignificant forces might drastically change the future of the forthcoming new cycle.
It is here, in the last two phases, that the possibility of triggering and shaping a Seneca Rebound becomes apparent. The increasing chaos of global politics, Lent suggests, is evidence that we are “entering the chaotic release phase,” where the old order begins to unravel. At this point, the system could either regress, or it could reorganize in a way that enables a new civilizational rebound. “This is a crucially important moment in the system’s life cycle for those who wish to change the predominant order.”»
Sounds like Jeremy Lent has exactly the same four phases as Turchin and Nefedov.
Denial:
Regarding the virus, I deeply hope you are right, for me the conclusions will only be known with some certitude in retrospect .
Found this:
https://www.zerohedge.com/health/gordon-chang-overwhelmed-chinese-authorities-are-falsifying-death-toll-coronavirus
It would be nice to be in my sixties, passed those years now. Have been a doomer, not one now, was part of the group taught to hide under one’s grade school desk in case of nuclear attack and whose parents were encouraged to keep a half a tank of gas in the car at all times. Even in the fifties, someone had an angle – think about that one and it is obvious.
To date the FED is doing well, for all we complain, our government keeps things going. Maybe the trains don’t run on time, but the SS checks arrive on time. Probably not as easy as it looks.
As for information, most likely with sophisticated data mining it is out there. What seems apparent to me is the old ideas of how we learn were not correct, we learn through heaps of data and memorization, the brain magically makes connections, inductive reasoning does not work all that well; starting to suspect that myths, superstitions are mental rules of thumb, work often enough to keep one alive. Lisp was sort of a learning language, it is still used in such programs as AutoCad but its use in AI seems to have declined from what I see, never got around to learning that one, lucky I guess. So much to learn, so little time.
Dennis L.
I found out yesterday that classes at Petroleum University in Beijing are only available online this semester, to try to help with the outbreak. Clearly, the shutdown is very widespread, to try to deal with the problem.
“The easing cycle at emerging market central banks continued unabated in January with policymakers continuing to join major central banks in efforts to shore up their economies.
“Interest rate moves by central banks across a group of 37 developing economies showed a net seven cuts in January after a net six reductions in December.”
https://www.reuters.com/article/uk-emerging-rates-graphic/graphic-lower-and-lower-emerging-central-banks-cut-rates-for-12th-month-idUSKBN1ZX1F7
“Companies and governments borrow $118bn in busiest start to the year…
“Emerging-market governments and companies embarked on a record borrowing spree in January, hoping to lock in very low interest costs.”
https://www.ft.com/content/e2b2559c-467d-11ea-aee2-9ddbdc86190d
“As China continues to reel from the spreading coronavirus, the world is looking for a familiar entity to swoop in and save the day: a central bank, in this case the People’s Bank of China.
“This time, though, even big rate cuts and other forms of easing may not be enough.”
https://www.cnbc.com/2020/02/03/why-central-banks-may-not-be-able-to-save-china-from-the-coronavirus.html
Try to keep things going with more debt.
China’s shut down affects 69% of its GDP.
https://www.bloomberg.com/amp/news/articles/2020-01-31/at-least-two-thirds-of-china-s-economy-to-stay-closed-next-week?__twitter_impression=true
They recently made their criteria more complex, but the IMF used to define a global recession as two quarters of growth lower than 3%. 0.7% growth would be bad news:
“The global economy faces a sharp slowdown as the coronavirus sends China into outright contraction and international trade grinds to a halt, economists have warned.
“World growth will crash to just 0.7pc in the first quarter of this year as a massive shutdown of Chinese industry sends shockwaves around the world, analysts at UBS said – a sharp cut from their previous prediction of 3.2pc annualised growth.
“This would represent the worst performance since the financial crisis. UBS now expects the Chinese economy to shrink by 1.5pc when compared to a year earlier, its first contraction for more than four decades.”
https://www.telegraph.co.uk/business/2020/02/03/global-growth-forecasts-slashed-chinas-coronavirus-spreads-world/
“Prices of copper, a barometer for the health of the global economy, have dived more than 12% since mid-January, as the coronavirus outbreak pushed China to extend a shutdown in its manufacturing regions…
“Copper is used extensively in manufacturing and demand for the metal — dubbed Dr. Copper — is an indicator of the economy’s health. China is the world’s largest metals consumer.”
https://www.cnbc.com/2020/02/04/coronavirus-chinas-manufacturing-city-shutdown-copper-prices-dive.html
“A bellwether of the global shipping market has hit an all-time low as the spread of the coronavirus weighs on global trade.
“The fast-spreading virus and uncertainty around its impact on the world’s economy have rocked markets and sent commodities prices to multi-month lows in recent days.”
https://www.wsj.com/articles/shipping-bellwether-hits-all-time-low-11580744101
Trade and manufacturing were already stumbling in 2019:
“The semiconductor industry last year suffered its worst annual slump in almost two decades, hurt by a trade war between the largest chip producer, the U.S., and the largest consumer, China. Revenue fell 12% to $412 billion in 2019, the Semiconductor Industry Association said Monday in a statement.”
https://www.bloomberg.com/news/articles/2020-02-03/chip-industry-had-worst-sales-year-since-dot-com-bubble-burst
Henry, I wouldn’t worry about capital goods. If everyone has a cellphone and a computer, it won’t really matter if no more are made for 2 to 3 years. It’s consumables we should worry about, especially the staples such as rice, corn, and wheat, all of which are far too globalised for peace of mind. Japan’s ingrained refusal to import rice was surely prescient.
“…it won’t really matter if no more are made for 2 to 3 years.”
It would matter to the companies who manufacture the cellphones and computers, and to their employees (who will spend less into the economy and may default on their debts). It would also matter to these companies’ shareholders, investors and creditors (which might fail with dire knock-on effects), as well as to the companies and nations that are involved in providing the raw materials for their products.
Even the apparently non-essential or frivolous have their part to play in keeping the global economy afloat, as we try to stay ahead of the inevitable debt crisis.
There are a lot of small computers in many things businesses use and homes use. Way too many of our appliances are “smart.” I know my washing machine is. Our new $15 coffee maker, which replaced an old one, draws power 24/7/365, so you can program it to start at a selected time in the morning. We didn’t really want the feature, but others in the store my husband shopped at were similar.
When something goes wrong with business computers, especially, they need to be replaced immediately. I remember waiting many hour at the Atlanta Airport, because Delta’s computers were down, meaning that all operations had to be done manually. Current operations get affected, very quickly. I can also remember where airplanes have been delayed from take off for an hour or so, because some seemingly trivial part needed to be replaced by a technician. If the part hadn’t been available, or the diagnostic tool to tell which part needed to be replaced hadn’t been available, the plane wouldn’t have taken off at all.
“Memory chips were the hardest hit.”
If everything is now being stored in the cloud, now, it is difficult to see why home computers and phones should have a large amount of chip storage.
Lots of data stored in the cloud, yes, but I think operating systems for phones / computers are becoming more and more bloated with every passing year. I think I also read somewhere that some smartphone operating systems now even operate in a manner that sees them start to slow down / lag in performance as you get closer to maxing out your storage capacity (maybe operating systems are using storage space as a sort of virtual memory?). I could be wrong though – I’m no techie.
Cheers,
-GBV
Part of the problem with the global shipping market is the higher fuel prices, too.
” The most traded copper contract on the Shanghai Futures Exchange fell by its daily limit of 7%.”
We are dealing with daily limits in the fall of copper, so the fall could continue for a while.
The Telegraph article says,
“Andrew Tilton, the investment bank’s chief Asia economist, said: “The economic impact we find in these previous episodes has at least as much to do with the control measures that are taken, such as restriction on travel and activity, as with the number of people that get infected.”
There was a recent Economist article that put the economic effect at as much as 90% caused by the control measures.
I heard that in Beijing, classes for Petroleum University will only be taught online this next semester, because of travel restrictions.
Clearly, the restrictions within China are very widespread and long-lasting.
[Expletive deleted by Gail]
Cathay Pacific plans deep flight cuts worldwide amid coronavirus woes
Sources say passenger numbers have collapsed by 50 per cent in recent days.
https://www.scmp.com/news/hong-kong/transport/article/3048918/hong-kongs-cathay-pacific-airways-plans-deep-flight-cuts
[Expletive deleted by Gail]
Macau Asks Casinos to Suspend Operations to Curb Coronavirus Spread
https://www.bloomberg.com/news/articles/2020-02-04/world-s-biggest-gambling-hub-asked-to-halt-to-curb-virus-spread
And meanwhile the SCMP reported that the virus is mutating.
https://www.scmp.com/news/china/science/article/3048772/striking-coronavirus-mutations-found-within-one-family-cluster
Mutating is a word that scares people. It panics them. They don’t buy fly or do much more than cower in fear.
This will not end well.
Decades of SF horror films with mutating vile ‘Things’ that eat you up haven’t really helped……
“And meanwhile the SCMP reported that the virus is mutating.”
Magus, I can’t get that link to offer up what is written and don’t want to join – do you have another link or can you paste in some of the article – thanks.
From the SCMP article:
‘Striking’ coronavirus mutations found within one family cluster, Chinese scientists say
>‘More work needed’ to determine impact of genetic changes on patients
>Case points to viral evolution in human-to-human transmission, researchers say
I found a great website for stats and graphs for infected etc. on the Corona Virus:
.https://www.worldometers.info/coronavirus/
I was curious to find out the increase number of infected and the following numbers are the increases in infected only, not the totals. J for Jan. & F for Feb.
J-24 468, J-25 705, J-26 786, J27 1778, J-28 1482, J-29 1755, J-30 2005, J-31 2127, F-1 2603, F-2 2836, F-3 3239
I was hoping for a more linear increase to make the math easy on figuring rate of increase but as you can see some days add more than others, but it’s close to adding 300 to each new days infected total. If 300 per day is added to the previous days increase, then F-4 is 3500, F-5 3800, F-6 4100, F-7 4400, F-8 4700, F-9 5000, F-10 5300 + the 20,000 already infected = 50,800 in another week.
Another way to do the math is to take that 50,800 estimate in another week and divide by the already infected 20,000 and that equals 2.54. Using that number in yet another week, there will be 127,000, then the next week will be 322,000, and by the end of February will be 819,300. I’m rounding on some of those figures.
If that rate of increase continued into the first week of March, the total infected would exceed 1 million.
On that link provided above look at the incubation period: 2-14 days!
Coronavirus Cases: 20,638 of which 2,790 (14%) in critical condition, Deaths: 427
So if on average 14% go into critical condition, then in early March when there are 1 million infected, approx. 140,000 will be in critical condition. How does a society cope with those kind of numbers?
Same way as before. You lock the infected in their homes, bar the windows, paint a big red cross on the door, and hunker down and wait for the Red Death to move on. In other words, there is no coping mechanism. We must submit to Nature and take out chances. And not before time; perhaps the biosphere is at last rebelling against our abuse.
Time to revive the “Missa tempore peste dicenda” ?
I have a lovely little 18th century Venetian pocket-book of masses, wonderful Latin -time to dig it out!
And for consolation, the beautiful ‘Salve Regina’ hymn.
Thank you, one of my favourite Latin hymns. And the exchange that usually follows is also most moving:
℣ Ora pro nobis, sancta Dei Genitrix,
℟ Ut digni efficiamur promissionibus Christi.
They will cope by doing what the CCP is doing now with its crash ‘hospital’ building programme: building what are their version of the ‘lazarettos’ of the Middle Ages and Renaissance – ie large facilities where the gravely sick are separated out and, mostly, die, with quick disposal through cremation and – if the total is very high and the ovens can’t cope – deep mass graves.
Oddly, I was pondering the possibility of ending up in a mass grave, due to Collapse, at Xmas: but living next to a medieval church dating from c1130 tends to provoke such thoughts: the grass of the churchyard stands a meter above the current street level due to all the burials piled up below.
Xabier, one of the first lazaretti was built right here in Malta, on Manoel Island in 1592. Islands have often been converted to quarantine stations: on Hagios Dimitrios, just off Corfu, and in the church of Santa Maria di Nazareth, one of the Venetian islands. Perhaps China could use Hainan Island for the same purpose.
But your point is surely valid: if things get worse, triage will probably be the only way we might cope.
They add to the denominator the huge number of cases that never make it into the hospital.
China will rewrite the Bible and the Quran to ‘reflect socialist values’ amid crackdown on Muslim Uighur minority:
https://www.dailymail.co.uk/news/article-7824541/China-rewrite-Bible-Quran-reflect-socialist-values.html
Not long after Coronavirus hits.
Sounds like the Chinese don’t have enough to do. Leave the folks alone.
Totalitarian regimes never leave one alone: even as Berlin fell in 1945, people were being hanged in the street or shot as ‘traitors’ to a system that had only days to live.
Perhaps they need to prove that they have “power” of some kind.
The virus is mutating https://www.scmp.com/news/china/science/article/3048772/striking-coronavirus-mutations-found-within-one-family-cluster
The link opened but won’t fully open to read it, but I did find the following linked article regarding mutation.
https://www.ucsf.edu/news/2020/01/416511/mysterious-coronavirus-spreads-infectious-disease-expert-explains-what-you
“The virus has already likely mutated to acquire the capacity to “jump” from animals to humans and to be transmitted person-to-person. Since this is an RNA virus, it will continue to mutate as long as it continues to circulate in humans.”
That’s concerning from the standpoint of attempting to develop a vaccine, if its changing.
Well, there is more.
The RNA has been found on a doorknob of an infected person.
https://www.zerohedge.com/health/discovery-coronavirus-doorknob-infected-patient-sparks-transmission-concerns
The tragedy is the Chinese worked very hard to make their country a better place and in so doing helped the entire world, some will disagree, but many lives are better now.
In addition to limits of materials, limits of Facebook, perhaps limits of hubris.
Dennis L.
http://theeconomiccollapseblog.com/archives/4-plagues-are-marching-across-asia-simultaneously-coronavirus-african-swine-fever-h5n1-bird-flu-and-h1n1-swine-flu
Basically, 4 viral diseases are in China, 3 in the food supply, 1 limited to humans, and 1 shared by both humans and h5n1 if I understand correctly.
This is a heavy load to carry.
Dennis L.
No kidding! I am sure our US CDC office in China has its hands full with three US assignees, and 11 local staff.
https://www.cnbc.com/2020/02/04/coronavirus-latest-updates-china-hubei.html
‘Coronavirus live updates: China says its death toll hits 425 as total cases rise to 20,438’
“7:55 am: China confirms 64 additional deaths and 3,235 new cases.”
https://www.youtube.com/watch?v=QqBTfQwrWGs
I don’t have any idea if this conspiracy theory that the new corona virus came from a level 4 bioweapons lab in Wuhan (several blocks from the wet market) has any credibility or not, but this video and other so called experts have claimed it to be true. Judge for yourself. Personally I’m skeptical but thought we should get all angles on this virus because it does seem to be increasing in number of infected at an increasingly large scale. Hopefully it will remain contained and level off.
There have been versions of this story going around. In a sense, it doesn’t really matter; it is a new virus, one way or another.
The fact that so many early victims worked at the market, or lived right next to it, make the story really doubtful. If it is related to some other virus (such as AIDS), then treatments for the other virus may be helpful here as well.
“In a sense, it doesn’t really matter; it is a new virus, one way or another.”
Ok, good enough, we’ll let it go there then.
We can’t even place any faith in the statement that the early victims came from the market: everything in this story is opaque, to say the least. There would be great irony if it turns out to have been an escaped vaccine, not a bio-weapon.
But really the only secure fact is that it is out and about, highly infectious, and we have to deal with the consequences.
We shall see how global containment efforts work out.
Gail, I found your link to the article that pointed out viruses are extremely simple they can not be much different they need all or most of their parts to function.
about us shale…
https://seekingalpha.com/article/4320190-abrupt-reversal-of-shale-oils-fortunes-points-to-radical-reset-of-oil-prices?ifp=0&utm_medium=email&utm_source=seeking_alpha
Andrew Butler, the author, is a “Registered Investment Advisor,” but he just doesn’t get it.
The author is betting that things will change this time. Prices will go higher than lower, because of scarcity. According to him:
The 2020 Reuters’ poll predicts $65. The author is predicting $130. I would still guess that $32.50 would be a better estimate. The system acts like it is collapsing. Prices go down in collapses, not up.
Brent now 54…
WTI was 49 earlier today…
to be a bit obsessive compulsive: both new 2020 lows!
I found a newer academic article from Lancet on the CDC website called Epidemiological and clinical characteristics of 99 cases of 2019 novel coronavirus pneumonia in Wuhan, China: a descriptive study
The study found that 49 of the 99 patients had a history of exposure to the Hunan seafood market. Many worked there, or lived nearby.
The study says:
It also says,
Current infection growth rate is 30% per day. If this continues the entire population of China will be infected in 37 days and the world in 42 days.
Wow! And any supply of anti-viral drugs will be long gone.
Remind me of the title of this post of yours. 😉
Two questions:
1] Have you included me in your will?
2] If you succumb, who takes over the blog?
But the vast majority of the infected will still not die. We will use up our anti-viral drugs, mostly on the old smokers with high blood pressure who are in terrible shape.
Actually there have been studies that smokers use up less medical resources including end of life care. Not sure if they are worth much.
Now if you had said obese people living a life of dissipation with no care for their health(other than going to the doctor). I would agree.
T2M
Somewhere “obese” was also mentioned as an issue in the study of 99 patients.
And let’s turn to another epidemic. The Epidemic of Despair
Will America’s Mortality Crisis Spread to the Rest of the World?
https://www.foreignaffairs.com/articles/united-states/2020-02-03/epidemic-despair?utm_campaign=special-preview-020320-despair-case-deaton-registrants&utm_content=20200203&utm_medium=promo_email&utm_source=special_send&utm_term=registrant-prerelease
One of the things the article talks about is this:
I think that this is to some extent related to the tax law, and also to how payments are made to mothers of children they are supporting. Taxes on two people married to each other are higher than if they are just living together, if both are working and earning modest wages. Also, a woman who is a head of household with a child can get benefits on behalf of that child. So it makes no economic sense for low income people to get married. Instead, they just have a series of live in friends, and the children are raised in a very haphazardly way. It makes for a real mess in the schools. The children don’t do well.
The other issue the article raises is the absurd cost of the health care system. The cost of the system becomes absurdly high compared to the wages of moderate-income and low-income people. The game by employers becomes one of “dodge the health insurance premium.” People are hired part time or as independent contractors. When they are independent contractors, they often cannot even get paid for costs associated with injuries on the jobs.
Someone needed to “just say no” to the health care system long ago. But this didn’t happen. And the poor people (in more than one way) who work as independent contractors have little jobs security. When one job ends, they need to find another job, without the benefit of unemployment insurance. How can they consider getting married? A person cannot support a family, when there is a need to be constantly finding another suitable job, perhaps in an entirely different location.
There is also the no-fault divorce law:
https://dalrock.wordpress.com/2012/04/14/threatpoint/
And the Duluth model:
https://dalrock.wordpress.com/2016/07/21/all-roads-lead-to-duluth/
I have run into quite a few higher income/status wives who have left their husbands because they were abusive or addicts of some kind, typically alcoholic. I have also run into a couple of women who were confident of their careers and felt the husband was not contributing enough (not working regularly, etc). They and the child could do as well without the husband as with him.
I really don’t know about lower income people. They often don’t get married in the first place. I heard through a friend that her adopted son had married a woman (in her teens). She had a baby shortly afterward. The son left not too much later, because he wasn’t up to the responsibility of raising a child. As a child, the son had been hyperactive and had been in constant trouble with authorities.
I knew one woman who said her husband was leaving her (after something like 6 or 9 months of marriage) because marriage was not as exiting as he expected.
Back here in America…
Land O’Lakes CEO: Rural America is the new inner city
Melody HahmSenior Writer
Yahoo FinanceFebruary 2, 2020, 11:01 AM EST
Land O’Lakes CEO Beth Ford and journalist Jessica Yellin at the 2020 Upfront Summit
While the urban world is talking about the power and promise of 5G, much of rural America is still having trouble getting online.
This week, the Federal Communications Commission approved a $20.4 billion program that could give six million rural homes and businesses access to high-speed broadband. FCC Chairman Ajit Pai calls the initiative the “boldest step yet to bridge this [digital] divide,” but the CEO of one of the largest dairy cooperatives said it’s simply not enough.
“It’s not that that’s nothing. I mean, that’s real money. But it’s inadequate. And then I meet constantly with governors, and they’re putting something- 10 million in the budget or 20 million… And it feels like we’re in the couch looking for the quarters and nickels. And that’s not going to get us there. It is going to make us uncompetitive as a nation. We cannot just leave these communities behind,” Land O’Lakes chief executive Beth Ford said in an interview Thursday at the Upfront Summit in Pasadena, California.
Arden Hills, Minn.-based Land O’Lakes handles everything from agricultural production to manufacturing consumer goods like butter and eggs. The $15 billion dairy giant works with 4,400 members, the majority of whom are farmers.
This comes amid an existential plight for many farmers, with Chapter 12 family farm bankruptcies increasing 20% in 2019. Farmers have been caught in the crosshairs of natural disasters and the ongoing trade wars. Still, U.S. farmers have shown unwavering — and growing — support for the Trump administration. Eighty-three percent of farmers and ranchers approve of the President’s job performance, according to Farm Journal’s latest poll.
When asked whether Ford has witnessed “any disillusionment among [2016] Trump voters,” she said many farmers aren’t passing the blame onto the President.
“It has been a very difficult couple of years. multiple years. Farm income is down, farmer suicides are up —
https://finance.yahoo.com/news/land-o-lakes-ceo-rural-america-is-the-new-inner-city-160129193.html
Yes, living out in the country is beautiful….if you are rich with positive cash flow
Or you know what you are doing. Next gen farmers will simply swallow those currently non performing ones.
That being said, have been struck recently by archaeology focused documentary piece on late Roman villa (well large rural estate) in Britain, they uncovered ~320AD dated luxury mosaic floor and plaster wall with materials imported from all over the world, apparently from the peak of the warm period and functioning trade. And by ~490AD the same mosaics floor was smashed for crudely made support wooden structure as the new inhabitants turned the derelict site into a barn. A bit later it was all either partly burned and or deleted to the ground as mere building material site for the next waves of inhabitants and their dwellings elsewhere.
Climate Models Are Running Red Hot, and Scientists Don’t Know Why
Eric Roston
BloombergFebruary 3, 2020, 5:00 AM EST
scientists involved couldn’t agree on why—or if the results should be trusted. Climatologists began “talking to each other like, ‘What’d you get?’, ‘What’d you get?’” said Andrew Gettelman, a senior scientist at the National Center for Atmospheric Research in Boulder, Colorado, which builds a high-profile climate model.
“The question is whether they’ve overshot,” said Mark Zelinka, staff scientist at Lawrence Livermore National Laboratory.
Researchers are starting to put together answers, a task that will take months at best, and there’s not yet agreement on how to interpret the hotter results. The reason for worry is that these same models have successfully projected global warming for a half century. Their output continues to frame all major scientific, policy and private-sector climate goals and debates, including the sixth encyclopedic assessment by the UN’s Intergovernmental Panel on Climate Change due out next year. If the same amount of climate pollution will bring faster warming than previously thought, humanity would have less time to avoid the worst impacts.
For now, however, there are doubts and worries. A higher warming estimate “probably isn’t the right answer,” said Klaus Wyser, senior researcher at the Swedish Meteorological and Hydrological Institute. His model produced a result of about 4.3°C warming, a 30% jump over its previous update. “We hope it’s not the right answer.”
Fearing virus, Hong Kong residents stock up on food, essentials
[edited by Gail – too long an excerpt]
This is coming to America!
It didn’t take long to move from travel restrictions to “likely pandemic.”
Wuhan Coronavirus Looks Increasingly Like a Pandemic, Experts Say
https://www.nytimes.com/2020/02/02/health/coronavirus-pandemic-china.html
It is “increasingly unlikely that the virus can be contained,” said Dr. Thomas R. Frieden, a former director of the Centers for Disease Control and Prevention who now runs Resolve to Save Lives, a nonprofit devoted to fighting epidemics.
“It is therefore likely that it will spread, as flu and other organisms do, but we still don’t know how far, wide or deadly it will be.”
Everyone seems to miss the point about flu epidemics
Back in 1918, everyone was panicking because that pandemic was killing off younger people
the likely reason for that was that there had been a previous lesser known less virulent epidemic in 1889/90
https://en.wikipedia.org/wiki/1889–90_flu_pandemic.
This killed off some people as flu always does, but it immunized the rest to a certain extent
but those born later didnt get that immunity dose, so when the big one hit in 1918, there wasn’t any immunity to it in people born after 1890 or so. Everyone born after 1890 had no immunity–ie people under 30
Seems to me a bit like the forst fires. The underbrush isn’t cleared out each year as it should be, so when the big fire hits, it just feed the flames
Interesting!
The best evidence I’ve seen about why the Spanish Flu killed off so many young people was because it killed people who had tuberculosis infections, resulting in a “W-shaped” age vs mortality curve which is quite rare as far as pandemics go.
so Norman, if this virus is “new”, then is it probable that no one has any immunity at all?
Most infected people survive it easily. Like a dose of flu. Our immune systems are still there identifying any likely pathogens.
Unknowable unknowns about the unknown, just about sums it all up.
The article seems to suggest that some of the HIV antivirals are being used to (hopefully) help patients with the virus. In fact, a relatively cheap version of one that is W.H.O. approved for use in fighting AIDS is made in India, for use in Africa.
If we actually have drugs that work and are not too expensive, it could be a game-changer in rich countries. In poor countries, perhaps not so much. The article’s big concern is Africa, because there are over one million Chinese who work there, plus many students from Africa studying in China. Being able to screen patients would be a problem.
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The WSJ has as its top online article, Saudis Weigh Large Oil Cuts in Response to Coronavirus
In my opinion, this is precisely the way peak oil happens. Demand drops for some reason (a virus and the response to that virus). Producers cut back supply. The lower supply, in itself, adds to the problem, rather than reducing it, partly because oil producing countries are negatively affected. There is also less oil to transport and refine. Oil producers head in the direction of defaulting on their debt. The reduction in supply doesn’t really fix the problem.
It’s the dreaded “smaller batch” again and the global financial system has no reverse gear…
so a virus starts to put the brake on the system that’s destroying the world
bugs rule, like i said
just like rain killed off the blob that was destroying the world.
And just as bugs killed off H G Wells; invading Martians. And if those “intellects vast and cool and unsympathetic” couldn’t cope, what chance do we have? You know, living through a science fiction catastrophe does have its charms. Maybe time for another read of M P Shiel’s “The Purple Cloud”, which by the way is online here: http://www.gutenberg.org/ebooks/11229.
I agree with all of the above…
I would just add that even a 1 million barrel per day reduction is way too small…
OPEC has continually come up short on its reductions since 2015…
either their stoopidity, or there is unknown pressure from other countries (USA), or each country does not want to reduce but wants everyone else to reduce…
it’s weird, but the bottom line is that since 2015 they have never reduced enough to raise prices significantly…
Or, people don’t understand that a reduction in oil supply reduces the number of jobs available in the world (and the amount they pay), and thus the demand.
People don’t think about oil being necessary for jobs.
Oil affects both sides of the ‘supply and demand’ curve.
https://gailtheactuary.files.wordpress.com/2018/09/33-low-energy-supply-affects-both-supply-and-demand.png
A person cannot believe the economists supply curve for commodities that are a necessary part of the economy. At most, a shortage produce a temporary price spice. Over the longer term, it is affordability (based on jobs) that counts.
I agree… a well taught lesson that I finally grasped last year…
so OPEC is always in a situation where they have to cut more than they realize…
at least that’s my sense of the matter…
Look at the membership of OPEC+, psycho Saudies, semi-psycho Gulfies, various color revolutionized (or not at the moment) Middle East and S American govs, and the affiliate Russia. Very hard to reach consensus. The only y/y predictable outcome beneficiary are the Austrians (hotels & shops & banks) for hosting their summits, lolz.
Some here have made comments regarding ZeroHedge. No single source does it all, no single source is always right and all sources have agendas, even this site. For me the trick is not to get every idea perfectly, the trick is to avoid mistakes where possible and minimize them when made.
So for interested parties, a bit of history according to Business Insider.
https://www.businessinsider.com/who-is-zero-hedge-finance-blog-that-spread-coronavirus-misinformation-2020-2?r=US&IR=T
Harry has a moderately wide source of quotes, it is necessary to take care that they are not too self referential as that can be a common problem resulting in silo thinking.
At the most fundamental level, good information has considerable value, leading people away from that information has the possibility of increasing the value to the few with access to it. There is always an agenda.
Dennis L.
Zero Hedge is a dung heap in which one can find the occasional jewel – an odd site,and one wonders who exactly is behind it.
As ever, discrimination is the path to discernment……
And who would believe BusinessInsider?
“With tens of millions of Chinese people quarantined inside their cities and thousands of factories closed, it is already clear that the coronavirus is about to sideswipe the global economy…
“”… it is clear that unless a cure and a vaccination are found rapidly, the fragile recovery that we predict is at risk.”” [The Centre for Economics and Business Research]
https://www.theguardian.com/business/2020/feb/01/fears-global-economic-slowdown-coronavirus-follows-trade-war
“Stocks haven’t been this vulnerable to macro threats and systemic weaknesses since the Great Recession and Dot Com bubble.”
https://www.ccn.com/coronavirus-will-trigger-an-epic-stock-market-crash-warns-godfather-analyst/
I would agree.
Harry,
Where is one to go with wealth? Several years ago Warren sent out a note to shareholders
recommending a book entitled, “The Death of Money.” There are very few places to store notational wealth.
Gold has advantages if you own something like Fort Knox, a web search shows the entrance with a large Abrams tank on a pedestal. That would be a tough place to rob, but most vaults, not so much.
Our greatest wealth in my opinion is our children, our health and what is between our ears. At the end of WWII, after literally slaughtering thousands the prize both the USSR and the US sought were some scientists one of whom Werhner van Braun came here. There were no war crime tribunals for him, there was a job, a house and the US came close to building a city for him, Huntsville, Alabama. All around him was ruin, he and his team moved on, their wealth was their families and their heads.
Dennis L.
Wealth is promises of future goods and services, made using energy. We have told ourselves that it is possible to store this up. We have also told ourselves that the value of what we store up will grow over time.
If you believe that we have an unlimited supply of extraordinarily inexpensive oil and other fossil fuels to extract, and that we won’t encounter any other bumps in the road either (epidemics, depleted fresh water supply, climate change, etc.), then you will believe that is possible to store up wealth. Otherwise, you will be pretty skeptical. I recommend diversification, but even that cannot be expected to save you.
A better plan is to spend a significant share of what you have now, to support the current economy. Help your children and grandchildren, if this seems appropriate. Give money to charities.
but spending to support the economy implies confidence that the money i spend now will be replaced at some near-future time by an ever-growing economic system
Im sure my grandchildren would be delighted to spend my money, but leaving myself at financial future-risk would not be a good idea
I’d like them to have a large pot of cash each from me, but I do not have the resources for such handouts.
No doubt those who have such resources have already done so, if only for tax avoidance purposes
They could spend the money you hand them …..for bringing your slippers, lighting your pipe and reading your Collected Works to you. It should be an honour for them.
ah yes
the ultimate circular economy
i shall update the IMF
Gail,
What will happen is anybody’s guess, but it can’t hurt to have a positive attitude, maybe everything is not known yet. Bumps are part of life, one of the greatest documents used to store and maintain wealth was the Constitution of the United States; it gave order for the citizens of this wonderful nation. We are not done yet.
Your advice about doing some things now was taken in the form of dance lessons, should I ever move to a place like the Villages, I won’t have to spend many evenings alone – thanks for the diversification idea.
I helped my daughter and my grandchildren when I chose my daughter’s mother – it was a wise choice. Many times what we do this year was determined by what was done the year before.
This virus thing could cause some problems, personally should it come to me my body will fight it out and either win or lose. Recall the words of Nietzche to the effect, “That which does not kill us makes us stronger.” Sometimes a bit of judgment does not hurt either, polio is worth a shot, mumps, measles, chicken pox, maybe like dirt in a child’s life, some dirt is good for health as it challenges the body.
We will get through this, it is a big world, an even larger universe and life is unfolding as it should.
Dennis L.
i prefer the line from the ”tweet of god”
that which does not kill us just needs more time
A T-shirt company should come out with a shirt with “that which does not kill us just needs more time.”
Germany evacuated 200 individuals from Wuhan and 20 of them could be confirmed to have the coronavirus, which is 10% of them.
If 10% infected can be used as a proxy for the Chinese population and Wuhan has a population of 11 million, then 1.1 million Chinese in Wuhan are infected.
And by the way…I’m coming down with a flu. It’s flu season. Let’s see if this is the real one.
Anyway…I got to go. Bats are flying in through the roof.
i shall read nothing you write for the next 14 days
“Bats are flying in through the roof.”
do not eat them undercooked…
This might be correct, but catching this virus is hardly a huge problem unless you are old and fragile.
I haven’t seen anything like 200 German’s evacuated from Wuhan and 20 have corona virus. I presume you simply are making an “if” statement. It is not a statement that this is the case. In fact, we have a hard time figuring out who is infected, until several days after they newly arrived have are back.
I ave seen charts showing that China has injected large amounts of liquidity into its financial markets via the repo market. It is doing its best to keep the bubble inflated.
“The coronavirus that has infected more than 14,000 people in two dozen countries may be transmitted through the digestive tract, Chinese state media reported.
“Virus genetic material was discovered in patient stool and rectal swabs, Xinhua said on Sunday (Feb 2).”
https://www.straitstimes.com/asia/east-asia/wuhan-virus-may-transmit-along-fecal-oral-route-xinhua-reports
“The interwoven nature of global trade means that the business and economic consequences of the disease could move rapidly from the Asia-Pacific region, infecting the U.S. and an already stagnating European economy.”
https://www.dailymail.co.uk/debate/article-7959579/City-Editor-ALEX-BRUMMER-asks-China-crisis-tip-recession.html
“Official figures showed that growth in the eurozone eased back from 0.3% to 0.1% in the final three months of 2019… Europe has never really recovered from the last crisis.”
https://www.theguardian.com/business/2020/feb/02/eu-states-in-poor-health-to-withstand-global-crisis
“Research from academics at the University of Sussex and Loughborough University shows that the [UK’s] productivity growth slowdown since the 2008 financial crisis is nearly twice as bad as the previous worst decade for efficiency gains, 1971-1981, and is unprecedented in more than two centuries.”
https://www.theguardian.com/business/2020/feb/03/uk-productivity-slowdown-worst-since-industrial-revolution-study
Energy consumption per capita has been falling in the UK. This cannot help productivity growth.
https://gailtheactuary.files.wordpress.com/2019/04/france-and-uk-energy-consumption-per-capita-through-2017.png
But 0.1% is still positive! It would seem like there is a range around the correct value.
No kidding! Sounds like what I was saying. The Daily Mail article says,
“Today, in spite of the current trade war with the U.S., which has put a dampener on Chinese and world growth, it accounts for a whopping 16.9 per cent of output.”
This comes close to what I calculated as GDP in Purchasing Power Parity. The US and other developed economies do not come out well on this basis.
https://gailtheactuary.files.wordpress.com/2020/01/percentages-of-world-gdp-china-and-us-in-2011-ppp-dollars.png
“South Korea’s factory activity slipped back to contraction in January on weak domestic sales, a private business survey showed on Monday (Feb 3), suggesting persistent pressure on an economy struggling to regain its footing.
“Worryingly, the latest survey didn’t reflect the outbreak of a rapidly spreading new coronavirus in China…”
https://www.straitstimes.com/business/economy/south-korea-factory-activity-returns-to-contraction-wuhan-virus-casts-shadow
“Japan’s manufacturing activity shrank for a ninth month in January as output and new orders contracted again, pointing to further strains on the economy, a business survey showed on Monday.
“That pressure could build rapidly in coming weeks as a virus outbreak raises the risk of a sharp blow to China’s economy that would weigh on its Asian neighbours.”
https://uk.reuters.com/article/uk-japan-economy-pmi/japans-factory-activity-contracts-again-in-january-virus-raises-fresh-risks-idUKKBN1ZX027
Japan is a clear worry with the coronavirus problem. Japan now has 20 confirmed cases. According to this article https://www.straitstimes.com/asia/east-asia/coronavirus-japan-tourist-businesses-hit-by-chinese-travel-ban
Japan is planning on the Olympics in July and August. All of these things are in addition to the supply line problems likely to be encountered from China. Also, Japan has a high share of elderly population, who seem to die easily from the disease.
“Chinese oil demand has dropped by about three million barrels a day, or 20 per cent of total consumption, as the coronavirus squeezes the economy, according to people with inside knowledge of the country’s energy industry.
“The drop is probably the largest demand shock the oil market has suffered since the global financial crisis of 2008 to 2009, and the most sudden since the Sept 11 attacks.”
https://www.straitstimes.com/business/economy/china-oil-demand-has-plunged-20-on-wuhan-virus-lockdown-biggest-shock-since-global
” Chinese commodity prices collapsed on the first day of trading after the Lunar New Year break as investors returned to markets gripped by fear over the impact the coronavirus will have on demand in the world’s biggest consumer of raw materials.
“The country’s three major commodity exchanges were hit by a fevered bout of selling…”
https://finance.yahoo.com/news/commodity-prices-collapse-china-demand-010846588.html
“Chinese stocks tumbled as traders returned from an extended lunar new year holiday, with the CSI 300 index of Shanghai- and Shenzhen-listed equities falling as much as 9.1 per cent on Monday to mark the worst opening in nearly 13 years.
“The drop came despite the central bank pumping Rmb1.2tn ($171bn) in additional liquidity into the financial system — its biggest one-day open market operation since 2004 — to help cushion the blow of the country’s deadly coronavirus outbreak.”
https://www.ft.com/content/14867176-461e-11ea-aeb3-955839e06441
The Yahoo article says:
“Metals, energy and agriculture futures were all hammered, with iron ore, crude, copper and palm oil contracts all sinking by their daily allowable limit within seconds of markets opening.”
A person wonders how many “daily allowable limits” we will be experiencing. Today’s movement is just the tip of the iceberg.
Three million barrels a day is a huge amount. This needs to end quickly, or there will be a huge downward impact on prices.
“The financial blog Zero Hedge was permanently suspended from Twitter on Friday after it published an article identifying a Chinese scientist it claimed created the deadly Wuhan coronavirus.”
https://www.businessinsider.com/who-is-zero-hedge-finance-blog-that-spread-coronavirus-misinformation-2020-2?r=US&IR=T#despite-the-massive-waves-caused-by-the-blogs-apparent-insider-informationthe-identities-behind-the-site-remained-a-mystery-2
Harry,
My apologies for referencing this article, perhaps we are following some of the same information sources; I just saw your reference, mine was an oversight, it added nothing as you had already found it.
Dennis L.
No problem, Dennis!
The glue that hold everything together in the world now is “financial”. Collapse of confidence, derivatives cannot be unwind, No credit, no money in ATMs, broken supply chain – anarchy. All else are irrelevant.
https://foreignpolicy.com/2018/08/07/global-supply-chains-are-dangerously-easy-to-snap/
Check out the last paragraph. There is a tipping point. Once it passes the tipping point, then it cannot be undone.
A person has to have a subscription to figure out what the last paragraph actually says.
https://money.cnn.com/data/premarket/
US Stock futures are up, in the green, so maybe US markets can shake off the Corona Virus blues?
US stock market rose 200 points and then started heading back down. Now at 143. I wouldn’t make a bet about the end of the day.
WTI is at $50.34.
Uh oh… Seems like China might be taking the viral outbreak a little more seriously than they’re saying…
https://beforethecollapse.com/2020/02/03/lockdown/
https://www.reuters.com/article/us-china-health/chinese-markets-plunge-as-rising-virus-death-toll-fuels-fears-for-global-growth-idUSKBN1ZX00T
It’s already Monday in China, and here’s some of the new numbers of infected, their stock market drop and their own repo operations:
“The number of deaths in China rose to 361 as of Sunday, up 57 from the previous day, the National Health Commission said. The number of new confirmed infections in China rose by 2,829, bringing the total to 17,205.”
“The Shanghai Composite index shed 8% to hit one-year low on Monday, wiping almost $370 billion off the market value, according to Reuters calculations.”
“Looking to head off panic, China’s central bank injected 1.2 trillion yuan ($173.8 billion) of liquidity into the markets via reverse repo operations on Monday.”
https://www.theguardian.com/world/2020/feb/02/shameless-outrage-china-coronavirus-outbreak-mask
“Footage of government officials in Wuhan appearing to take face masks intended for health workers battling the highly infectious coronavirus has fuelled a growing wave of anger over how Chinese authorities have handled the outbreak.”
“Images of medical staff making protective equipment out of rubbish bags, sleeping in hospitals, and crying in frustration and exhaustion have dominated Chinese social media over the last two weeks, inspiring an outpouring of sympathy and donations of supplies.”
If true, that wouldn’t be surprising, Just as people saw that the Bolsheviks were the best clothed, fed, and housed in revolutionary Russia in the early 1920’s. Just lovely to be a Party member…
I am curious to read some more of the “Before the Collapse” blogposts, but the site requires me to enter a password which is the solution to the following riddle: “sex+bullshit = ?” My guesses (love? capitalism?) were all wrong. Does anybody know the solution?
Supposedly the password to the protected “before the collapse” blog posts is in his books. I don’t know, sorry. Some older posts are always open, newer posts are usually open for a little while. Not sure how much is based on actual info, how much on conjecture, but it’s interesting thinking
The sun is in an equilibrium between the forces of gravity that want to crush it, and the nuclear explosions that want to blow it apart. As it runs out of fuel over billions of years the forces of gravity will dominate and it will crush into an earth sized white dwarf.
It strikes me that our human economies are a perfect analogy. If we turned off the electricity tomorrow and stopped all use of petroleum, any economy would crush within a week.
So our economies totally have this gravitational force at play, and holding them up against this force is our burning of fossil fuels. Like the sun, we find our point if equilibrium. And like the sun, the whole thing implodes when there is insufficient energy to keep gravity at bay.
But unlike the sun with its 5 billion years of fuel left, we have just 50 years odd of known oil reserves left, and we can’t burn even those without catastrophic impacts on the climate.
So when will gravity bring our economies crashing down? Sooner than you think I guess and from a process already well under way
The Australian grids are having issues with solar farms
https://www.abc.net.au/news/2020-02-03/mallee-solar-farms-asked-to-reduce-output-to-grid/11912848
According to the article,
I am surprised the issue have taken this long to appear. They must not have been looking at what they were approving very closely, relative to what the grid could handle.
The Australian grid is a nationally coordinated enterprise.
Energy project approvals are generally state-based decisions.
Unless federal funding is required, or unless there are nationally significant environmental issues at stake the Australian federal government is not involved in the approvals process.
They know now that this arrangement is unsatisfactory – but the horse has already bolted.
Gail, here’s the takeaway:
‘Mr Grant said there was “clearly a need to reconfigure the network” from what he called the “hub and spoke model” — where large thermal generators in Victoria’s Latrobe Valley and the NSW Hunter Valley are linked to major urban centres on the east coast via “transmission backbones”‘.
As the US local airline companies painfully discovered, hub and spoke may be efficient, but it is not reliable. Lapses of quality (eg late departures) compound themselves, and the level of service rapidly deteriorates. For electricity transmission, the same applies. Indeed, that is another application of the Perron / Frobenius theorem. (Synchronicity rules.)
Sorry, it was getting late and I probably didn’t get to the last paragraph.
The need for redundancy is something that engineers tend to overlook. They look for the cheapest route, but that doesn’t give enough backup. Modeling the way to put together the network often doesn’t work in the real world, for this reason.
A reader sent me a link to a recently published article in Nature that seems to have relevance here. It is called Predicting collapse of adaptive networked systems without knowing the network by Leonard Horstmeyer, Tuan Minh Pham, Jan Korbel, and Stefan Thurner. The authors are from four different research organizations studying complex systems.
You will have to read the paper to see exactly what it has to say. These are a few of my thoughts:
According to the paper, complex systems, including societies as a whole, are prone to collapse. Whether the elimination of any node or interaction in a network leads to collapse depends to a large extent on the structural details of the interaction network.
Cycles are particularly important in allowing complex systems to have long-term stability. Cycles are “directed closed paths whose only repeated vertices are the first and the last.” Generally, the more cycles there are in a networked system, the more stable it becomes. Without operating cycles, the networked system is prone to collapse.
[none of what follows is from the paper – this is my take on how it applies here]
The way I view the world economy, if each of the individual countries is pretty much independent, the world economy can be pretty stable. Each of the individual economies will use energy to make finished goods and services. Each will pay workers wages that they can use to buy finished goods, and each will repay debt with interest.
If the individual economies are more or less independent, each of the economies are cycles that contribute to the overall world economy, which is another cycle. As the world economy becomes more integrated, the system become more and more like one big cycle, rather than a number of little cycles that are more or less coordinated.
In fact, China was the last major economy added to the world economy. It was able to pull the world economy forward for quite a long time. It started to lose its force about 2012-2013 and has been struggling ever since. World oil prices started to fall in 2014, recognizing these issues. The big issue was China’s coal production maxing out.
https://gailtheactuary.files.wordpress.com/2019/06/china-energy-production-by-fuel-to-2018-bp.png
Now the world economy is dependent on China, but China is flaming out. China was the world’s last large cycle added, pulling the world economy forward. China is showing us it still excels at complexity, even if it is now short of cheap to extract fuel. It can sequence the genome of the DNA of the problem virus and develop a vaccine as fast as is humanly possible.
The rest of the world sees the great steps that China is going to, and thinks it must respond in kind. This tends to shut down the world economy.
The world economy does not have enough independent cycles any more to keep safe from collapse.
Gail,
Anything in there about the system “adjusting” or “compensating” when a cycle collapses? What I mean is, will a system reorganize itself rather than completely collapse because one cycle gives out?
One would think we’ve likely been “collapsing” cycles for many years now and the system has been compensating with things like additional debt, consolidation of power/responsibility to inter/multi-national organizations, resource depletion, etc.
How long that can continue, I certainly don’t know. China is certainly an important linchpin, but who knows… maybe there are a few magic tricks / get-out-of-jail-free cards left in the back pocket of our globalist overlords?
Sorry, I will try to make time to read the article (it does sound interesting!), but pressed for time this evening.
Cheers,
-GBV
The article says, “The central idea of this paper is to develop an early warning signal that detects the last surviving cycle in a networked dynamical system.” Once the last surviving cycle is gone, the system becomes very unstable, and is likely to collapse.
I think that China is very close to the last surviving cycle in our networked world economy. The United States, with its energy supplies, comes fairly close, as well, but the US is very dependent on China and on the rest of the world for imports of all kinds. Russia has perhaps has close to a full cycle as well. There are a lot of countries that are just “service economies” or are suppliers of a few kinds of minerals. They don’t seem to have much of a chance on their own.
We know that in general, dissipative structures tend to grow with adequate energy supplies of the right kind. They eventually collapse. We also know that new, dissipative structures often are eventually formed, using remnants of old dissipative structures and perhaps other inputs. This paper is saying that the new dissipative structures will need to have cycles in them, as well, or they will tend to collapse.
Within an economic system, the lowest level of system would seem to be the family. Perhaps groups of families can get together and form their own little economy (cycle), if they can provide food, water, fuel for cooking and other essentials for their populations. It would be best if multiple little groups of families did this. These groups of families could then trade with each other and they could find marriage partners from other groups that were not too closely related.
It is interesting that the economy which looks like it is coming close to collapse is China. China has close to the world’s most intelligent people, according to intelligence tests and math tests. Japan and Korea would rank very highly as well.
Perhaps intelligence is not the characteristic that is needed most, given the resources available in the world today. Perhaps it is physical strength and ability to withstand a range of temperatures, so that fossil fuels aren’t as necessary. Many black people seem to have these characteristics. Then fossil fuels would be less important. In that case, new mini-economies might grow in places like Africa and some of the island nations. But that is just my speculation. It is not in the paper.
So, quote from last paragraph of the referenced article, “This fact is due to an immediate corollary of the Perron-Frobenius theorem — it follows that for linear dynamics, as in (1) the absence of cycles corresponds to a collapsed state because the vast majority of nodes cannot sustain themselves; their respective states vanish.”
So I know all of you are familiar with this theorem, but just incase:
Perron–Frobenius theorem, proved by Oskar Perron (1907) and Georg Frobenius (1912), asserts that a real square matrix with positive entries has a unique largest real eigenvalue and that the corresponding eigenvector can be chosen to have strictly positive components, and also asserts a similar….
Simple translation, “No man is an island.” So introduce a woman an wow, now you have cycles!
This stuff gets harder and harder to read and requires more and more knowledge, and a smaller and smaller proportion of the population has a clue.
Dennis L.
Dennis, you should look at the work of Maurice Potron (1872 to 1942), one of the very few people who applied the Perron / Frobenius work to economics. Looked at through the lens of classical economic theory, it helps explain why Adam Smith’s views on comparative advantage are correct for commodities, but don’t work for labour or for extractive economies. And hence, why “globalisation” leads to economic systems with inherent instability.
Thank you, found a book on Amazon, The Analysis of Linear Economic Systems which is a collection of Maurice Potron’s works, it is on it’s way. Brief summary found on the web, “With virtually no knowledge in economic theory, he wrote down a linear model of production in which he formalized the notions of just prices and just wages.”
I personally like “just prices and wages” which to my mind fits well with the idea that there are bears who make money and bulls who make money, pigs go to market.
Again, thank you Gail, hard to find these ideas without a very wide range of opinions freely expressed and respectfully received.
Dennis L.
You will notice that I had the good sense to use families as the smallest possible unit. As you say, “No man is an island.”
” It is interesting that the economy which looks like it is coming close to collapse is China. China has close to the world’s most intelligent people, according to intelligence tests and math tests. Japan and Korea would rank very highly as well.”
Other factors that could be important beside average IQ are variance of IQ, average creativity and variance of the creativity. My guess is that the variance is quite important since a society don’t need that many highly intelligent and/or highly creative people. These people have a disproportional effect at least if energy is available.
I believe that physical strength is overrated. Health, endurance and mental strength will be the qualities that make a difference. The importance of IQ will likely decrease as energy consumtion decreases.
What use could a bastard girl in a 17th century farming village have for 130+ IQ?
Today top-2% IQ almost guarantees top-10% income (in the developed world at least).
She could become Maria Crescentia Höss, perhaps; now Saint Maria Crescentia.
Probably not much, IQ needs leverage from energy inputs to be of much use.
Even the lord of the manor didn’t need a brain, really, by the 18th century.
In Britain, the richer gentry saw no need to educate their eldest sons beyond a certain point because they would inherit the land -the most secure store of wealth – and had a guaranteed income awaiting them.
But the people who got those estates in the first place were probably pretty smart as well as violent: cunning and intelligence were highly thought of by the Vikings and barbarian peoples.
Should come across some of those get out of jail free cards, could you let us know? They might be useful.
Dennis L.
+++++++++++
Thank you for the reference, ail: one to read with a good glass of wine in hand one evening.
A theory look at alongside Tainter’s early insights on the potential fatality of excessive inter-dependence among inter-locking economies.
I believe you coined the phrase ‘Korowicz moment’
I was personally hoping for 2 more years, just got an inheritance. But the universe doesn’t care about that. 🙂
‘Korowicz Event’, yes.
We all had the most wonderful inheritance, this planet, and we have squandered it: I hope you get some pleasure out of yours, I feel – call me a wild optimist – it is not quite ‘midnight in the graveyard’ yet.
The wise words of Korowicz: ‘Get a dog and have some good walks’ – rr the equivalent……
A friend who is an architect based in Jakarta received a call from his client yesterday who is an Australian doctor working for an organization involved in monitoring global epidemics.
He receives regular updates from the CDC related to the coronavirus and was informed that there are serious concerns about dead bodies killed by the virus that the CDC has examined.
He told my friend to leave Indonesia/Asia as soon as possible. I have asked him if he knows more specifics regarding the CDC ‘concerns’
I have not heard back from him as of yet.
I reiterate, the actions of global governments shutting their borders, cancelling flights etc… are UNPRECEDENTED. If this persists the global economy will crash. So why would they do this unless they fear something?
And 8 billion people are staring at this like deer looking into the headlights of an 18 wheeler hurtling towards them at 120kmph.
Something is up. Perhaps this virus is far more of a problem than we are told.
Keep in mind, the swine virus that is circling the planet has no cure and no vaccine.
You sound… alarmed.
I thought we weren’t supposed to wake you up until deaths hit 200,000? 😐
-GBV
Hysterical, panic-stricken, beyond-alarmed comments like this make me question that I visit this site. Am I too so emotionally incontinent? Do I too start at every shadow? Are these the kinds of people who are concerned about issues of depletion and environmental damage? Is this how they think and react? Because it is not good. It is entirely uinreasonable and in fact, downright neurotic. It makes me wonder I too am perhaps over-reacting. It certainly discourages me from suggesting anyone else read here – as much as I like Gail’s content.
Or is your comment some kind of humor? Are you mocking us?
Please let us know. Don’t keep us in suspense. You are joking, right?
“If this persists the global economy will crash. So why would they do this unless they fear something?”
They’re trying to stop it from spreading short term, so in the long term the global economy will remain viable. I wouldn’t read anything else into it.
There are no dead bodies of this coronavirus in the US, so the US has not examined any dead bodies with this virus. What kind of nonsense are you talking about?
The CDC puts up what it knows on its website. This is a link to its summary.
https://www.cdc.gov/coronavirus/2019-nCoV/summary.html
According to it’s website, the CDC has offices in 61 countries and they do have one in China, so it’s possible they may have examined some of the deceased by now. What concerns they have about the deceased, if any, are not listed at their site. However, I assume they don’t post all information they have if it might cause a panic.
I didn’t realize that the CDC had that many offices. I know that they have a big office in Atlanta. Also, Atlanta was referred to as the place where samples were being sent for testing.
The CDC website says,
I was not sure how to interpret this, so I looked online for more information.
In China, there is a big Chinese governmental organization called CCDC. Big website, big buildings, etc.
I found a website about the Chinese US CDC location. https://www.cdc.gov/globalhealth/countries/china/default.htm
Also this fact sheet: https://www.cdc.gov/globalhealth/countries/china/pdf/china_fact-sheet.pdf
According to these, the US CDC in China has 3 US assignees and 11 locally employed individuals.
The areas the US CDC in China is reported to be involved with are these:
(1) Computer modeling of best practices in public health systems that can detect diseases, before they become pandemics
(2) Helping China’s own CDC develop suitable public health systems in Africa and elsewhere.
(3) CDC is the primary technical partner for the Chinese Field Epidemiology Training Program, which trains field epidemiologists for China.
(4) CDC supports Chinese partners in monitoring seasonal and novel influenza viruses, as well as enhancing efforts to detect and respond to seasonal, avian, and other novel influenza viruses with pandemic potential.
(5) CDC collaborates with China’s own CDC to improve its ability to detect and respond to emerging infectious diseases . . .to reduce disease burden due to rabies, brucellosis, and other zoonotic diseases.
(6) As of 2017, there were about 900,000 people in China diagnosed with tuberculosis. The CDC is working with Chinese partners to get better treatment for this large number of of infected individuals.
So the US does have an “ear on the ground” in China. We can’t know whether these folks know big secrets that aren’t being put up on the US CDC website. With three staff members from the US, it is thinly staffed to do a whole lot in all of these areas simultaneously.
this is from Bloomberg Green… what the…
https://www.bloomberg.com/news/articles/2020-02-02/activists-occupy-german-coal-plant-in-protest-police-say
“German utility Uniper aims to close most of its coal plants by 2025, but intends to keep the Datteln-4 plant operating until 2038…”
Everyone thinks that they have a solution to our problems.
your calculation only takes into consideration the % that dies. maybe more importantly
are those ones that get pneumonia and need to be hospitalized.this % could be as high
as 25%. now 1/3 x 25%= 8.333% of the world population needing to be hospitalized. such
a run on health care would put such a strain that i doubt any economy could withstand the costs.
China has treated this properly(in my opinion) and if this illness gets out of hand i only hope my govt can match their efforts.
I made the point that finding inexpensive treatments is important. If AIDS drugs can stop the symptoms before they get to be severe (something that is not known at this time, however), then would seem like a lot of the need for hospitalizations could be eliminated.
The system could be bankrupted by all of the hospitalizations. We collectively cannot devote huge resources to health care, without cutting back on other needed things, like food and education.
Copper is sitting right above its support line.
https://pbs.twimg.com/media/EPpJvY1WoAQXqSq?format=jpg&name=large
China counts for 50% of global copper demand and its manufacturing is now shut down.
Hopefully, not all of China’s manufacturing will be shut down for long, however. It is just the extended New Year.
China has today officially 15 thousand confirmed Coronavirus cases. This is only 0.001% of the population.
Maybe they can contain the virus.
Although no one knows how many more are infected and now is in the incubation state before symptoms break out.
I guess we will have to wait and see what happens in the coming weeks.
Cue the racism:
https://www.zerohedge.com/geopolitical/i-am-not-virus-outbreak-leads-shocking-rise-racism-toward-asian-people
Funny how people will refuse to prepare for a pandemic outbreak and will label individuals who are only trying to spread precautionary information as alarmists, yet have no problem giving into xenophobic fear mongering…
Cheers,
-GBV
Who are these individuials who both
1) Refuse to prepare….
and
2) Are giving into…?
Or are you perhaps the current president of either the Everything I Read Fits Into My Personal My Hobby Horse Club or The Straw Man Club?
I get ALL my Predictions from the Simpsons!
Fans Claim The Simpsons Predicted Coronavirus Outbreak In 1993 Episode
Deadline
Anita Bennett
DeadlineFebruary 2, 2020
The episode shows juicers being packed into boxes in Japan as one of the workers says, “Please don’t tell the supervisor I have the flu.” He then coughs into the box, sending the virus to the U.S. Once the fancy juicers arrive in Springfield, most of the residents fall ill.
Even though the virus in the episode came from Japan, instead of Wuhan in China, fans have been burning up Twitter saying The Simpsons has a penchant for predicting global events.
Apologies if this has already been posted here. Taleb, et al have a paper out that states we might not be able to absorb a hit like this as a world civilization. It depends on how many “hits” to the system there are.https://static1.squarespace.com/static/5b68a4e4a2772c2a206180a1/t/5e2efaa2ff2cf27efbe8fc91/1580137123173/Systemic_Risk_of_Pandemic_via_Novel_Path.pdf
Thank you, familiar with Taleb, I was not aware of the New England Complex System’s Institute. So much to learn, so little time.
There is a well known historian whose name escapes me now with a similar idea, a civilization can withstand one large hit, multiple hits seem to be the end. Can’t recall or site the paper/book.
Dennis L.
Dennis, that sounds a bit like Arnold Toynbee’s “challenge and response” ideas. But that is only a guess.
I think part of the problem is the reaction of China. If China had reacted as if the current situation were no big deal, the rest of the world would behave similarly. The fact that China has reacted with such alarm almost guarantees that the rest of the world reacts with alarm. It is as if, every action has an equal an opposite reaction.
Perhaps China acted with such alarm because they had information that warranted them being alarmed? Perhaps they recognized the results of not implementing massive quarantines would be more destabilizing than allowing nCoV to rapidly spread?
I don’t think it is such a stretch to suggest that we, the “little people”, don’t have access to all of the information at this point. Also pretty sure nobody on OFW has as full an understanding as the PRC as to what is going on over there on the ground.
Maybe I’m just an alarmist, but when I see China taking steps such as these, I assume the situation is far worse than “just another seasonal flu”, as some have suggested that’s all this is.
-GBV
Think sharing the conclusion might be worthwhile, as many may not bother with clicking on the link:
Conclusion: Standard individual-scale policy approaches such as isolation, contact tracing and monitoring are rapidly (computationally) overwhelmed in the face of mass infection, and thus also cannot be relied upon to stop a pandemic. Multiscale population approaches including drastically pruning contact networks using collective boundaries and social behavior change, and community self-monitoring, are essential.
Together, these observations lead to the necessity of a precautionary approach to current and potential pandemic outbreaks that must include constraining mobility patterns in
the early stages of an outbreak, especially when little is known about the true parameters of the pathogen.
It will cost something to reduce mobility in the short term, but to fail do so will eventually cost everything—if not from this event, then one in the future. Outbreaks are inevitable, but an appropriately precautionary response can mitigate systemic risk to the globe at large. But policy- and decision-makers must act swiftly and avoid the fallacy that to have an appropriate respect for uncertainty in the face of possible irreversible catastrophe amounts to “paranoia,” or the converse a belief that nothing can be done.
Bolded sections were my emphasis, not the original authors.
Cheers,
-GBV
In 19998, Tom Clancy’s novel, RAINBOW SIX had a plot of a group that wanted to solve the resources per capita problem. They spread a virus that grew into a pandemic. The bad guys were some pharmotechs and they had the supposed vaccine. The vaccine that they gave out was bad and killed everyone but they had a real vaccine that they saved for themselves so they would survive to live in a world without the humanoid race cancer. I give a second thought to Clancy’s ideas since 9/11/01. In 1994 he wrote DEBT OF HONOR which climaxed with a 747 loaded with fuel being flown into the US Capitol Bldg. with a great explosion and fire. Air Liners as flying bombs. What a concept.
And here we are with all the hysteria of the coronavirus and surely they will have a vaccine soon so get ready for the MaxVax.
Also he also wrote SUM OF ALL FEARS in 1991 where some middle eastern terrorists set off a small A-Bomb at the Super Bowl.
well, I have made all my (small) bets, so an A-Bomb tonight would be quite annoying…
Yep, swampy agencies are constantly scanning literature both for possible leaks and also for inspiration of future operations, which occasionally go live as you indicated. This has been known for decades and also as plot depicted in older movie feat Redford?
Several years ago, I was invited out to the US Naval War College in Rhode Island, for a symposium. They had invited a large number of people, including me, to give ideas regarding what kind of problems the navy might encounter, as the world reach limits. The invitees were from a wide range of different backgrounds. I remember that some were fiction (perhaps movie) writers. One man was an oceanographer. There were people advising the government about climate change. The navy wanted to know what kinds of war games they should simulate, so as to be prepared for the future. They were getting ideas from a wide range of invitees.
Comments on this one?
The video inside the facility appears real, it is an impressive feat of construction and organization in a very short period of time, less than sixty days from discovery to implementation. China seems to be able to move very quickly in many areas, again, when they announced building a hospital in a few days, well, wait and see; it looks like they did it. Say what one will, they are making serious attempts to limit the spread, it is a real time experiment with interesting social implications were it to work.
Sometime ago I came across a saying, quote by what I think were combat soldiers to the effect, “If it works it is right, if it does not, it is wrong.” A combat soldier many times only gets one chance to pick the right door, pick the wrong door and it is the last door that individual may ever pick.
The end of the URL, “where you go to die” seems a bit melodramatic, but in times not that long ago, going to the hospital was a death sentence, or maybe recognition that what could be done had been done. Whatever, nobody at the ASPO meetings ever presented these types of scenarios as possible results of declining oil production which apparently peaked in 2018 or thereabouts. Still, even with today’s technology selling adds, attracting eyeballs is the name of the game. Except, here, Gail does not do that, very rare, very rare.
https://www.zerohedge.com/markets/shocking-footage-inside-chinas-newly-constructed-hospitals-jail-cells-where-you-go-die
Dennis L.
I would describe the hospital units as being prefab construction. This kind of construction seems to be used quite a bit elsewhere as well, when a building is needed quickly, especially if the building might be temporary.
Seems to me that the increased ability of public health networks to track viruses and disseminate this information broadly has the unintended consequence of panicking populations. What would have happened if the progress of the 2018 flu which killed 80,000 Americans received similar scrutiny?
I am afraid you are right. We also think that we can and should fix all problems. But trying to do so reduces resources available to fix other problems.