Why are we seeing so much violence recently? One explanation is that people are sympathizing with those in the Minneapolis area who are upset at the death of George Floyd. They believe that a white cop used excessive force in subduing Floyd, leading to his death.
I believe that there is a much deeper story involved. As I wrote in my recent post, Understanding Our Pandemic – Economy Predicament, the problem we are facing is too many people relative to resources, particularly energy resources. This leads to a condition sometimes referred to as “overshoot and collapse.” The economy grows for a while, may stabilize for a time, and then heads in a downward direction, essentially because energy consumption per capita falls too low.
Strangely enough, this energy crisis looks like a crisis of affordability. The young and the poor, especially, cannot afford to buy goods and services that they need, such as a home in which to raise their children and a vehicle to drive. Trying to do so leaves them with excessive debt. If the affordability problem changes for the worse, the young and the poor are likely to protest. In fact, these protests may become violent.
The pandemic tends to make the affordability problem worse for minorities and young people because they are disproportionately affected by job losses associated with lockdowns. In many cases, the poor catch COVID-19 more frequently because they live and/or work in crowded conditions where the disease spreads easily. In the US, blacks seem to be especially hard hit, both by COVID-19 and through the loss of jobs. These issues, plus the availability of guns, makes the situation particularly explosive in the US.
Let me explain these issues further.
[1] Energy is required for all aspects of the economy.
Energy is required by governments. Energy is required to operate police cars. Energy is required to build schools and to operate their heating and lighting. Energy is needed to build and maintain roads. Tax revenue represents available funds to buy energy products and goods and services made with energy products.
Energy is needed for any type of business. Operating a computer requires electricity, which is a form of energy. Heating or cooling a building requires energy. Growing food requires solar energy from the sun; liquid fuel is used to operate farm machinery and trucks that transport food to the locations where it is sold. Human energy is used for some of these processes. For example, human energy is used to operate computers and farm machinery. Human energy is sometimes used to pick the crops, as well.
Wages paid by governments and businesses indirectly go to buy energy products of many kinds. Food is, of course, an energy product. The heat to cook or bake the food is also an energy product. Metals of all kinds are made using energy products, and lumber is cut and transported using energy products. With sufficient wages, it is possible to buy or rent a home, and to purchase or lease an automobile.
Interest rates indirectly reflect the portion of goods and services produced by energy products that can be transferred to parts of the system that depend on interest earnings. For example, banks, insurance companies and those on pensions depend on interest earnings. If interest rates are high, benefits to pensioners can easily be paid and insurance companies can charge low rates for their products, because their interest earnings will help offset claim costs.
Interest rates are now about as low as they can go, indicating a likely shortage of energy for funding these interest rates. The last time interest rates were close to current levels was during the Great Depression of the 1930s.
Figure 1. Ten-year and three-month US Treasury interest rates, in chart made by FRED.
[2] When there is not enough energy to go around, the result can be low commodity prices, low wages and layoffs.
This is not an intuitive result. Most people assume (low energy = high prices), but this is the opposite of what actually happens. The problem is that the amount workers can afford to pay for finished goods and services needs to be high enough to make production of the commodities used in making the finished products profitable. When affordability falls too low, the system tends to collapse.
We are really dealing with a two-sided problem. The prices of commodities such as oil, wholesale electricity, steel, copper and food tend to fluctuate widely. Consumers need these prices to be low, in order for the price of finished goods made with these commodities to be affordable; producers need the prices of these commodities to rise ever-higher, to cover the cost of deeper wells and more batteries, to try to partially offset the intermittency of solar and wind electricity.
Most people assume that the situation will be resolved in the direction of commodity prices rising ever higher. In fact, commodity prices did rise higher, until mid 2008. Then, something snapped; commodity prices have been falling ever-lower since mid 2008. In fact, ever-lower commodity prices have been a world-wide problem, causing huge problems for countries trying to support their economies with export revenues based on commodity production.
Figure 2. CRB Commodity Price Index from 1995 to June 2, 2020. Chart prepared by Trading Economics. Composition is 39% energy, 41% agriculture, 7% precious metals and 13% industrial metals.
Even before the lockdowns, low commodity prices were leading to low wages of those working in commodity industries around the world. These low prices also led to low tax revenue, and this low tax revenue led to an inability of governments to afford the services that citizens expect, such as bus service and subsidized prices for certain essential goods/services. For example, South Africa (an exporter of coal and minerals) was experiencing public protests in September 2019, for reasons such as these. Chile is a major exporter of copper and lithium. Low prices of those commodities led to violent protests in 2019 for similar reasons.
Now, in 2020, lockdowns have led to even lower commodity prices. At times, farmers have been plowing their crops under. Oil companies are laying off workers. The trend toward lower commodity prices had been occurring for a long time; the recent drop in prices was “the straw that broke the camel’s back.” If prices stay this low, there is a danger of falling production of commodities that we depend on, including food, metals, electricity, and oil. Businesses producing these items will fail, and governments with falling tax revenue will be unable to support them.
[3] Historical energy consumption data shows that violence often accompanies periods when energy production is not growing fast enough to meet the needs of the growing population.
Figure 3 shows average annual growth in world energy consumption, for 10-year periods:
Figure 3. Average growth in energy consumption for 10 year periods, based on Vaclav Smil estimates from Energy Transitions: History, Requirements and Prospects (Appendix) together with BP Statistical Data for 1965 and subsequent.
Economic growth encompasses both population growth and rising standards of living. Figure 4 below takes the same information used in Figure 3 and divides it into (a) the portion underlying population growth, and (b) the portion of the energy supply growth available for improved standards of living. During most periods, increased population absorbs over half of increased energy consumption.
Figure 4. Figure similar to Figure 3, except that energy devoted to population growth and growth in living standards are separated. A circle is also added showing the recent growth in energy is primarily the result of China’s temporary growth in coal supplies.
There are three dips in the Living Standards portion of Figure 4. The first one came in the 10 years ended 1860, just before the US Civil War. Most of us would say that was a period of violence.
The second one occurred in the 10 years ended 1930. This is the period when the Great Depression began. It came between World War I and World War II. This was another violent period of our history.
The third dip came in the 10-year period ended 2000. This was not a particularly violent period; instead, it reflects the collapse of the central government of the Soviet Union, leaving the member republics to continue on their own. There was a huge loss of demand (really, affordability) on the part of countries that were part of the Soviet Union or depended on the Soviet Union.
Figure 5. Chart showing the fall in Eastern Europe’s materials production, after the collapse of the central government of the Soviet Union in 1991.
[4] The world is facing a situation in which total energy consumption seems likely to drop by 5% per year, or perhaps more.
If we look back at Figure 3, we see that even in very “bad” times economically, energy consumption was rising. In fact, in one 10-year period, the average increase was more than 5% per year.
If the world economy is reaching a point in which we consumers, in the aggregate, cannot afford the goods and services made with commodities, unless commodity prices are very low, we will likely experience a huge drop in energy consumption. I don’t know exactly how much the annual change will be, but energy consumption growth and GDP growth tend to move together. We might guess that GDP growth is shifting to 5% GDP annual shrinkage, and energy consumption will be shrinking by a similar percentage.
Clearly, shrinkage of 5% per year would be far worse than the world economy has experienced in the last 200 years. In fact, for the 10-year periods shown in Figure 3, there has never been a reduction in energy consumption. Even if I am wrong and the shrinkage in energy consumption is “only” 2% per year, this would be far worse than the experience over any 10-year period. In fact, during the Great Recession, world energy consumption only shrank in one year (2009) and then by 1.4%.
History doesn’t give us much guidance regarding what impact a dramatic reduction in energy consumption would have on the economy, except that population reduction would likely be part of the change that takes place. If half or more of energy consumption growth goes toward rising population (Figure 4), then a shrinkage of energy consumption seems likely to reduce world population.
[5] What the world is really facing is a competition regarding which parts of the economy can stay, and which will need to be eliminated, if there is not enough energy to go around. It should not be surprising if this competition often leads to violence.
As I indicated in Section [1], all parts of the economy depend on energy. If there is not enough, some parts must shrink back. The big question is, “Which parts?”
(a) Do governments, and organizations that bind governments together, collapse? If countries are doing poorly, they will not want to contribute to the World Trade Organization, the United Nations or the European Union. Governments, such as the government of Saudi Arabia, could be overthrown, or may simply stop operating. In fact, any government, when it faces insurmountable problems, could simply stop operating and leave its functions to lower levels of government, such as states, provinces, or cities.
(b) Do pension plans stop operating? Are pensioners left “out in the cold”? How about Social Security recipients?
(c) Can international trade be kept operating? It is a big consumer of energy. Also, competition with low-wage countries tends to keep wages in developed nations low. Without international trade, many imported goods (including imported medicines) become unavailable.
(d) Which companies will collapse, leaving bond holders and stockholders with $0? People who formerly had jobs with these companies will also find themselves without jobs.
(e) If the world economy cannot support as many people as before, which ones will be left out? Is it people in rich countries who find themselves without jobs? Is it people who find themselves without imported medicines? Is it the ones who catch COVID-19? Or is it mostly citizens of very poor countries, whose income will fall so low that starvation becomes a concern?
[6] The violent demonstrations represent an effort to try to push the problems related to the shortfall in energy, and the goods and services that energy can provide, away from the protest groups, toward other segments of the economy.
In an ideal world:
(a) Jobs that pay well would be available to all.
(b) Governments would be able to afford to provide a wide range of services to all, including free health care for all and reimbursement for time off from work for being sick. They would also be able to provide adequate pensions for the elderly and low cost public transit.
(c) Police would treat all citizens well. No group would be so poor that a life of crime would seem to be a solution.
As indicated in Section [2], back in 2019, before COVID-19 hit, protests were already starting because of low commodity prices and the indirect impacts of low commodity prices. One reason why governments were so eager to adopt shutdowns is the fact that when people were required to stay inside because of COVID-19, the problem of protests could be stopped.
It should be no surprise, then, that the protests came back, once the lockdowns have ended. There are now more people out of work and more people who are concerned about not having full healthcare costs reimbursed. Social distancing requirements are making it more difficult for businesses to operate profitably, indirectly leading to fewer available jobs.
[7] Violent protests seem to push problems fueled by an inadequate supply of affordable energy toward (a) governments and (b) insurance companies.
In some cases, insurance companies will pay for damages caused by protesters. Eventually, costs could become too great for insurance companies. Most policies have exclusions for “acts of war.” If protests escalate, this exclusion might become applicable.
Governments of all kinds are already being stressed by shutdowns because when citizens are not working, there is less tax revenue. If, in addition, governments have been paying COVID-19 related costs, this creates an even bigger budget mismatch. Governments find themselves less and less able to pay their everyday expenses, such as hiring teachers, policemen, and firemen. All of these issues tend to push city governments toward bankruptcy and more layoffs.
[8] Dark skinned people living in America tend to be Vitamin D deficient, making them more prone to getting severe cases of COVID-19. Vitamin supplements may be an inexpensive way of reducing the severity of the COVID-19 epidemic and thus lessening its diversion of energy resources.
There are a number of reports out that suggest that having adequate Vitamin D from sunlight strengthens the immune system and helps reduce the mortality of COVID-19. Adequate Vitamin C is also helpful for the immune system for people in general, not just those with dark skin.
Dark skinned people are adapted to living near the equator. If they live in the United States or Europe, their bodies make less Vitamin D from the slanted rays available in those parts of the world than they would living near the equator. As a result, studies show that Vitamin D deficiency is more common in African Americans than other Americans.
Recent data shows that the COVID-19 mortality rate for black Americans is 2.4 times that of white Americans. COVID-19 hospitalization rates are no doubt higher as well. Encouraging Americans with dark skin to take Vitamin D supplements would seem to be at least a partial solution to the problem of greater disease severity for Blacks. Vitamin C supplements, or more fresh fruit, might be helpful for all people, not just those with low Vitamin D levels.
If the COVID-19 impact can be lessened in a very inexpensive way, this would seem to be helpful for the economy in general. High-cost solutions simply divert available resources toward fighting COVID-19, making the overall resource shortfall for the rest of the economy worse.
[9] Much more equal wages would seem to be a solution for wage disparity, but this doesn’t bring the wages of low earning workers up enough, in practice.
There are a huge number of low-earning workers in many countries around the world. In order to increase commodity prices enough to make them profitable for producers, we really need wages in all countries to be much higher. For example, wages in Africa and in India need to be much higher, so that people in these parts of the world can afford goods such as cars, air conditioning and vacation travel. There is no way this can be done. Furthermore, such a change would add pollution and climate change issues.
There is a fundamental “not enough to go around” problem that we do not have an answer for. Historically, when there hasn’t been enough to go around, the attempted solution was fighting wars over what was available. In a way, the violence seen in cities around the globe is a new version of this violence. Governments of various kinds may ultimately be casualties of these uprisings. Remaining lower-level governments will be left with the problem of starting over again, issuing new currency and trying to make new alliances. In total, the new economy will be very different; it will probably bear little resemblance to today’s world economy.
The concept of “service economy” came about seriously after the internet boom, probably after the year 2000. It was not until around the time of GFC1 that this word became very common. It was the FIRE industry (Finance, Insurance, Real Estate) took off big time that, it is a household word. Generally, when the GDP from this service sector (Financial Services, Tourism, Distribution, Health and Education are some of the examples) is more than the agricultural and manufacturing , then it is considered as a service-based economy.
It is just impossible for every country in the whole world to be a “service economy”. who will do the farming or manufacturing ? Where will the food come from? Where will be pens, paper and car come from? Can we just survive with just Financial Services, Tourism, Distribution, Health and Education?
To me, when a country/state/city declares that it planning to go into service economy, it just another way of saying “we screwed up on agriculture and manufacturing”. When manufacturing slowed down a lot and exports from China slows down, China did say that they are not focusing on becoming a service economy. Is it wonderful that when the service component of the GDP becomes higher (due to lower manufacturing), then China comes out and say that they want to be a service economy? So, where will all the manufacturing and agriculture go?
To me personally, all the numbers like GDP, money velocity, etc are all flawed. I just don’t know how on earth can they quantify it easily. Say, a country has 10% of its GDP from tourism. It is not an exact science. If I have a $100m house. I sell to Gail and she sells back to me with a $50m increase. We did it 20 times passing to and fro, yes, the government collects the taxes, but you know what? we have increased the GDP by many billions.
Economy has to be generated by energy and by physical human work (farming, making stuff, etc). They convert the energy into tangible goods for sale to others. Cities along the trade routes flourished due to trade and when trade dried up, the cities die. There are many books on this topic. Trade is service economy. The ancient city may not produce a lot but got along through trade. People provide hotels, warehouses, insurance, banking, etc for these traders, which is essentially a service economy. However, out of the city, there will be farmlands, but they may not have enough food for the city and the food has to be brought in. These services are good for the trade. It is also parasitic. It makes the goods more expensive when it reach the destination.
With the use of fossil fuel and through internet, services boomed. Financial services, tourism, distribution, health and education became global and we keep on hearing that the world is a smaller place. Economies of scale kicked in, globalization brought lower prices and things went ballistic. Everyone “prospered” and it is believed that “service economy” is the future. That is of course is false. Pumping up the economy via parasitic services like interests on lending, rents, commissions, cuts from sales will eventually cause the whole edifice to collapse. As Gail and Norman has stated many times, the most basic and underlying layer is energy. The next layer up is food and water. The subsequent layer is clothing, shelter and basic needs. It goes up and up until the top is air travel, luxurious cars and yacht. It is this parasitic economy that enables those who skim the gains off the producers, and they are the ones ware driving the luxury cars. This upside-down world is unstable where the producers should be honoured rather than the skimmers. I came across a fiction (book) but I did not read – in a fictitious city, the powerful leaders are the poor people and the lowest social class are the rich people. It is an upside down world that goes against what we know.
So, when fossil fuel is getting more expensive, debts came in to replace. So, right now, USA has added $1T in just 5 weeks. Is that not exponential?
US National Debt Spiked by $1 trillion in 5 weeks to $26 trillion. Fed monetized 65%. Business debts spike to high heaven.
https://wolfstreet.com/2020/06/12/wow-thats-fast-debt-out-the-wazoo/
Conclusion – to me personally, service economy is not even an economy at all. It is a Potemkin village. Service economy is nothing more than the people who are taking care of the props (painting, rearranging, etc). Compare to the economies of the 1950- early 1970s where there was a real main street, there was a real economy – agricultural, manufacturing and some services. The families, the core values and traditional values were all real. The good produced lasted a long time and things were “more normal”. Of course, was it a coincidence that in the 1970s,w hen conventional peak oil happened in USA, debt exploded and FIRE economy stated to take off and it went ballistic after 2000 (after Glass-Steagall was repealed, internet boomed and China came up)?
Thanks! I think you have the story right. I was fortunate to be an actuary, working in insurance, as everything took off and grew. For a while, “Actuary” was rated as the top job in the US, in one set of rankings. I see it is rated as #10 now, according to Careercast.com.
You say, “I came across a fiction (book) but I did not read – in a fictitious city, the powerful leaders are the poor people and the lowest social class are the rich people. It is an upside down world that goes against what we know.”
By the way, this is precisely the message that Jesus brings in the New Testament. He says, “So the last will be first and the first will be last.” (Matthew 20:16) Acts 20:35 says that Jesus said, “It is more blessed to give than receive.” Matthew 5:5 says, “Blessed are the meek, for they will inherit the earth.” Many of the liberal churches focus their sermons around teachings such as these. Whether or not the background is fictional is not particularly important. Yet I have an endless stream of commenters who seem to say, “All religions are bad.” The message of the New Testament appeals more to women than men, because the message is more threatening to men. It also appeals to Blacks and others who are discriminated against now.
Great piece Gail,
You’re helping me to more clearly understand and articulate the manifestation of human action and cultural development as a result of access and utilisation of energy.
Regarding the “not enough to go around” problem:
In my eyes this becomes more of an issue the more humans harness yesterday’s sunshine. From biomass to coal to oil. An unprecedented scenario, a species unlocking the potential energy of historical biological processes. A transition to decentralised energy generation and “enough to go around” would, like you say, look like a different economy and way of life.
Almost everywhere that the sun shines, there are biologically evolved photosynthetic apparatus (plants and phytoplankton) which are climatically and geographically specific. These are highly efficient at capturing light energy and converting to sugar, cellulose, lignin etc.
If it is fuel, food, fibre and shelter that is lacking to go around, it just so happens that these can all be derived from said plants. This “natural techonology” generating “natural capital” could be the cornerstone of innovating a fair, just and true cost economy which, through its function, benefits socially and ecologically. A transition that can be mitigated by appropriate technology and what’s left of buried sunshine.
Unfortunately, what’s left of buried sunshine can’t be extracted because we can’t get the price high enough. Peak oilers and other modelers assumed that resources we could see and had the technology to extract could, in fact, be extracted. It doesn’t work quite that way, however.
Nassim Taleb: Masks Matter- Here’s the Model
Six issues–this is part of one of them:
Second error: Missing the Nonlinearity of the Risk of Infection
The error is to think that if I reduce the exposure to the virus by, say, ½, I would then reduce the risk, expressed as probability of infection, by ½ as well.
https://zh-prod-1cc738ca-7d3b-4a72-b792-20bd8d8fa069.storage.googleapis.com/s3fs-public/styles/inline_image_desktop/public/inline-images/1_XV3AU17D7-rJ2Z8lZE3pWw.png
Not quite. . . . A reduction in the viral load by 75% for a short exposure could reduce the probability of infection by 95% or more!
Face masks might well help when mixing with the general public, but this article from 4 years ago says they are no good for dentists:
Why Face Masks Don’t Work [for dentists]: A Revealing Review
https://www.oralhealthgroup.com/features/face-masks-dont-work-revealing-review/
“Conclusions
The primary reason for mandating the wearing of face masks is to protect dental personnel from airborne pathogens. This review has established that face masks are incapable of providing such a level of protection…”
I read yesterday that wearing of face masks is now compulsory in all public transport in the UK. I also heard on the radio this morning that maximum capacity on public transport is now 20% of what it was pre-COVID19 because of the 2m antisocial distancing rule, currently under review and to be reported on in July.
Public transport needed to subsidized, almost everywhere, pre-COVID-19. Subsidies become absurdly expensive at a maximum 20% occupant rate.
Minorities disproportionately use public transportation systems in many places. They will be at a terrible disadvantage, if they can’t get to their jobs for lack of public transport.
Thank you, Minority of One, for sharing the link to this review. More evidence that masks are placebos to make people feel better and give the illusion of safety.
And, in fact, cloth masks appear to increase the risk of infection, with medical masks not appreciably different from no masks in terms of protection against lab-confirmed respiratory viruses: https://bmjopen.bmj.com/content/5/4/e006577.
This kind of evidence (randomized controlled trial) is the strongest available. Comparisons between countries and before/after comparisons are weak and cannot eliminate alternate explanations.
Note, however, that the authors essentially renounce their results in updated comments: https://bmjopen.bmj.com/content/5/4/e006577.responses#covid-19-shortages-of-masks-and-the-use-of-cloth-masks-as-a-last-resort. Though their illogical reinterpretation is alarming, it doesn’t change their results.
“We” get it, you don’t want to wear a mask and exposes your bias. I don’t like them either, the same with safety belts and helmets.
From Zerohedge:
Federal Tax Receipts Show A Record Plunge In May, Raising More Doubts About Employment Data Accuracy
Also:
Perhaps something has not been recorded properly? Author is Joseph Carson, former chief economist at Alliance Bernstein.
thanks… that’s a good addition to the unemployment story…
Shadowstats still says unemployment is about 35%…
On a roll with GO
https://news.yahoo.com/congos-gold-being-smuggled-tonne-071855765.html
Congo’s gold being smuggled out by the tonne, U.N. report finds
June 15, 2020, 3:18 AM EDT
Reuters) – Gold production in Democratic Republic of Congo continues to be systematically underreported while tonnes of the precious metal is smuggled into global supply chains through its eastern neighbours, a United Nations report has found.
The countries along Congo’s eastern border have long been conduits for gold worth billions of dollars mined using rudimentary means by so-called “artisanal” miners.
Difficult to trace, trade in the precious metal has fueled regional wars, funded rebel fighters and led to UN sanctions on traders involved in a bid to staunch the flow.
North Kivu, South Kivu and Ituri provinces reported official production of just over 60kg of artisanal gold in 2019, yet exported a total of just over 73kg, the UN Group of Experts on the Congo found in its annual report.
The group estimated that at least 1.1 tonnes of gold were smuggled out of Ituri province alone in 2019. That would have earned the government up to $1.88 million in taxes had it been legally exported.
Across all gold-producing provinces the loss is likely much greater. Artisanal miners in Congo produce 15 to 22 tonnes of gold a year, Germany’s Federal Institute for Geosciences and Natural Resources has estimated.
“The country remained one of the Great Lakes region’s largest artisanal gold producers, and yet one of its smallest official exporters,” the Group of Experts wrote.
BAU….Blood Diamonds…now we can add ….this has been going on for some time
The pace of disintegration of the USA is breathtaking. Defunding the police will be a wild ride to watch. The colour revolution comes home to the alphabet soup of the ‘intelligence community’. If ever there was a wide open oxymoron walking down the street.
‘The ideal, however, was simply what Robespierre said it was. And the law was what Robespierre and his followers willed it to be. They changed it at will and determined whether its application in a particular case was just. The justification of monstrous actions by appealing to a passionately held ideal, elevated as the standard of reason and morality, is a characteristic feature of political ideologies…’
https://www.city-journal.org/html/why-robespierre-chose-terror-12935.html
Of course nothing matters until the good people of Florida, Hamptons and Hollywood are embroiled.
I didn’t study European history, so I missed reading about Robespierre. I think that might have been for the best.
The article says:
So ideals that sounded high-minded justified killing a lot of people in horrible ways.
Unfortunately my schooling had next to no history content in it. It was science all the way.
It is only in my later years that I realise what a benefit a study of history would have been. Of course, if it was part of a ‘Nation State’ educational system and a managed curriculum, the benefits may have lessened.
We are on a path well travelled. The lessen of the French Revolution seems to be how effective a small group can be, and how its location, location, location. My understanding is that the effects were centred on a few major urban centres, and that the bulk of the country was relatively unscathed. Earning a living took precedence over co-opting the political system; for better or worse.
It would seem that the further you are from nature, the more the nature of man is freed from moderation.
As Aldous Huxley pointed out in one of his essays from the 1930’s, if you are trying to establish a perfect society through sudden revolution, not gradual reform which accepts imperfection, you are invariably going to become a mass murderer and have to set up prison and torture camps.
Not good!
I don’t live in or near any big city…
perhaps many big cities should disband their police departments, so that we can watch the results of this experiment from a distance…
even if no American big city disbands, it seems almost certain that there will be a swift decline of economic and social prospects starting right about NOW…
an exodus from these cities would be expected now also, for those who are able and can afford to exit…
get the popcorn ready etc…
Huuuuge experiment!
Make Anarchy Great America.
The City of Atlanta is small compared to the metropolitan area. The city’s population is only 523,738 in 2020. This is less than the population of Nashville, for example. The Atlanta metro population is 6,101,355 according to the same source. https://worldpopulationreview.com/us-cities/atlanta-population/
The above source reports the City of Atlanta to be 52% black and 40% white. The metropolitan area varies in its racial profile. The suburbs are, on average, more white. Visiting stores in the area where I live, I would estimate 20% to 25% of the shoppers are black. I expect that in my area, blacks disproportionately live in apartments rather than single family homes.
I don’t feel bad now about leaving a stash of quarters in a cart at Target. Was going to pay at checkout with them and forgot they were there and left them🤑😥.
https://abc7chicago.com/amp/gold-bars-on-train-swiss-federal-railways-francs/6248478/
SWISS AUTHORITIES SEARCH FOR MYSTERY OWNER WHO LEFT $191K OF GOLD BARS ON TRAIN
Swiss police are looking for a forgetful individual who left something rather important on a train — a package full of gold bars, worth more than $190,000.
The parcel containing the gold bars was found in the carriage of a Swiss Federal Railways (SBB) train traveling from the northeastern Swiss town of St Gallen to Lucerne, a city in the center of the country, in October last year, authorities said
Despite “extensive investigations,” the owner of the high-value package had not been tracked down, officials said in a statement published in the local government Lucerne Canton gazette.
After authorities failed to track down the owner of the precious cargo, the gold bars, worth 182,000 Swiss francs ($191,000), were confiscated by the public prosecutors office.
Now, authorities have decided to publicize their quest to find the bounty’s mysterious owner
Suppose that’s a drawback on traveling with valuables….they tend to get lost or stolen.
One certainty: someone so careless cannot have been Swiss.
Or if they were, things are truly falling apart…..
Or someone so rich that they considered a few gold bars to be small change?
Or someone so illicit that they dare not claim the valuables?
Or someone so forgetful that they forgot they were carrying them?
If this helps the authorities, I can’t remember owning them or carrying them or leaving them on the train. But I can’t be totally sure they were not mine.
A house of cards…
“Powell Is Now Helpless”: Even A Modest Market Wobble Threatens To Devastate The Real Economy
http://www.globaltimes.cn/Portals/0/attachment/2017/2017-06-15/a3935810-a040-45d9-ad9d-9f882e3140a5.jpeg
“The real economy is capitulating irrespective of the markets. We have long since moved past the point that keeping the markets buoyant can save the real economy from devastation.”
And the real economy has become Wall Street, not Main Street.
The article concludes:
We have lived since 1981 on lowering interest rates and adding more debt. Now we cannot do more.
There are not nearly enough profits overall in the system. The young and blacks are demanding a larger share of the profits as wages, but they really aren’t there, IMO.
Gail,
Thanks for the effort you are putting into this, it is helpful in getting at least a partial grasp on what is happening.
We can trade paper assets on a greater and greater scale, basically it is day trading as the only way to obtain cash is selling an asset. Share buy backs with borrowed money have done the same thing, those who got the bonus shares sold them for cash and stuff, the company became poorer, burdened with debt in many cases with a few exceptions. It would be interesting to see what portion of insider sales are related to stock bonus programs. Debt, financialization should end when a company can no longer pay interest on the debt.
As I have beaten to death, the kids are footing the bill for the SS collectors as are migrant workers who most likely pay into SS and will never get anything out as they are not citizens. Unearned income has no payroll taxes.
Running a business and paying a net living wage to people is not that hard, running a company and paying payroll taxes, unemployment, workman’s comp. and whatever else is not very easy and may be impossible for most professions – perhaps the reason for the gig economy as some of the business deductions can be useful, e. g. Uber, I suppose one can depreciate an auto for the amount used for cab rides. If it cash flows for gas and maintenance the effect is a cheaper personal car when needed, effectively a person can have the personal portion of a car, if one only needs half a car this is a solution. The Uber driver has found a way around payroll taxes.
Thanks for keeping at it, we live in interesting times.
Dennis L.
«There are not nearly enough profits overall in the system. The young and blacks are demanding a larger share of the profits as wages, but they really aren’t there, IMO.»
Marx talked about the declining trend in profit rates as even more technology and complexity had to be added in the competition. I remember some time back – actually i think a few years back – i think Gail had a figure, based on a study, describing this trend over a long time. Would perhaps be interesting to see if Gail remember the study and the figure?
I think perhaps I used pretax profits of US companies. This chart shows pre-tax profits of US companies, without an adjustment for inflation. Notice the peak year was 2014. The timing corresponded with the time oil prices started tumbling. No wonder companies were demanding a reduction in taxes!
https://gailtheactuary.files.wordpress.com/2020/04/corporate-profits-before-tax-through-2020q1.png
The following chart shows the same pretax profits of US companies, adjusted for inflation using CPI urban. In this chart, it becomes clear that the profit level of mid 2014 was hardly above the third quarter 2006 profit level, adjusted for inflation. Recent pretax profits (before inventory valuation adjustment and capital consumption adjustment) have been way down.
https://gailtheactuary.files.wordpress.com/2020/04/corporate-profits-divided-by-cpi-urban-inflation-index-through-2020-q1.png
I expect that the 2nd quarter of 2020 will be below the trough in the fourth quarter 2008.
Thanks, Gail, been away for a while, so no reply from me before. My impression was however that the long term trend i talked about was taken from a study or scientific work by a foreigner – an italian? – and that the study was not limited only to US.
I don’t remember.
Reviewing Gail’s excellent article again, I find section 5 the most interesting:
“As I indicated in Section [1], all parts of the economy depend on energy. If there is not enough, some parts must shrink back. The big question is, “Which parts?””
Then Gail asks a series of very good questions which really ought to be getting discussed in every mainstream news outlet everywhere now, but from what I can tell no-one is.
I posted an article here a couple of weeks ago from the UK’s Independent newspaper. It is arguably the biggest news story of the century, so far. I managed to find one other newspaper that covered the issue, the Daily Mail. The original report was published on 18 April, and the Daily Mail, a rather right-wing newspaper, seems to be the only media outlet in the UK that picked up on it then, that I can tell:
Here is the original report from the Institute for Social and Economic Research (ISER) at the University of Essex:
https://www.iser.essex.ac.uk/2020/04/18/new-analysis-of-the-impact-of-lockdown-on-uk-jobs
“Estimates produced by the Institute for Social and Economic Research (ISER) at the University of Essex suggest the lockdown can take more than 6.5m jobs out of the economy -around a quarter of the total.”
If 6.5 million workers in the UK lose their jobs, the results will be devastating. This is why Gail’s questions are so important to ask now. Govt income from taxes has already plummeted due to people out of work, at the same as expenditure to help those on furlough has exploded. According to Mike Maloney, history has shown that whenever a govt creates huge amounts of money out of thin air to balance the budget, eventually hyperinflation occurs. That’s in addition to all the jobless, homeless, and those suffering from illnesses and death relating to malnutrition, no nutrition, stress and depression. The storms are gathering.
Thanks for the link. Now that it has been a while since shutdowns started, it is possible to see real number for job losses. For example, CNBC shows this one for April in the US:
https://www.cnbc.com/2020/05/08/these-industries-suffered-the-biggest-job-losses-in-april-2020.html
One issue is that a lot of people come from the point of view of, “My life (or my parent’s life, or the loss of life of my grandmother) is a whole lot more important to me than someone else’s possible loss of a job.”
They cannot understand the economy cannot work in a state of contraction. The debt bubble that holds the whole economy up tends to implode.
In this video, Mike Maloney gives his reasoning for hyperinflation possibly before the end of this year, relates to debt and the huge quantities of it. Mike’s videos are usually 15-20 min. but not this one (50 min.). To get the gist of what he is saying, watch about the first 5 minutes then jump to 40 minutes.
This Is The End: How & When Deflation Turns To Hyperinflation
https://goldsilver.com/blog/this-is-the-end-how-when-deflation-turns-to-hyperinflation/
Similar conclusions from “Consciousness of Sheep” website ……
“It will be a rude awakening for all. But, ironically, those at the very bottom are better prepared than most for the shock that is coming. Those who have been forced to endure a decade of pin balling in and out of various under-paid, part-time, zero-hours and gig economy jobs, interspersed with periods on the wrong end of a toxic social security system have already given up many of the “luxuries” that the metropolitan liberal class still views as essential. The poor will suffer too, of course. As the price of food, clean water, heat and lighting increase there will be little if any income left over.
But the big psychological shock will be to a middle class that rapidly finds that its employment is surplus to requirement and that everything it took as certain in life is collapsing around its ears.”
https://consciousnessofsheep.co.uk/2020/06/15/a-rude-awakening/
good stuff, thanks…
I think he mentioned the $25T US debt and said “this isn’t working”…
but in the sense that the economy has not collapsed during the rise to $25T, it is working!
he then says the debt clock could be $30T or even $40T by the end of the year or maybe in 2 or 3 years… and could go up and up to $100T beyond that…
if the system is still running at quasi-pseudo-bAU enough for US debt to still exist, even if $30T or $40T, then that could very well mean the system is still working!
in other words, if $25T in US debt has not produced hyperinflation, then I don’t see why $30T or $40T would necessarily produce hyperinflation…
but overall, to me it’s not “the end” so much as that we are in The Endgame… which could (and my wild guess is it will go on for ? more years) end at any time, but why would more $T of debt do it?
I see The Endgame as: near zero rates and ever higher gov debt, inflation of essentials, deflation of non-essentials, though deflation of essential energy resources, artificial high markets, lower overall wages and prosperity (even if unemployment comes down)…
in other words (again), what is being seen and done right now = The Endgame…
which will continue until something “breaks”… some essential subsystem, or something failing in the finance/banking “operating system” of the economy…
if nothing “breaks” (and so The Collapse), the other course will be a slow slow general decline in overall prosperity, with a mix of steep dips and no more than partial recoveries…
not much about this is certain, other than the direction of prosperity must be down…
Wasn’t it just at the beginning of last year that USA govt debt was less than $20T? And it took decades to get that level. It is now $26T+ (https://usdebtclock.org/) and possibly will go past $30T or $40T by end of year. What is different between now and the past is the speed at which debt is being created.
The last 10 minutes of Mike’s talk, from 40 min onwards, he is discussing a Working Paper from Federal Reserve Bank of Chicago, recently published, where they discuss the option of deliberately increasing the rate of inflation as a means of resolving the debt problem. Here is the paper:
https://www.chicagofed.org/publications/working-papers/2020/2020-13
“Against this background, we study the implications of a coordinated fiscal (govt policies) and monetary (Fed policies) strategy aimed at creating a controlled rise of inflation to wear away a targeted fraction of debt. Under this coordinated strategy, the fiscal authority (govt) introduces an emergency budget with no provisions on how it will be balanced, while the monetary authority (the Fed) tolerates a temporary increase in inflation to accommodate the emergency budget.”
>>aimed at creating a controlled rise of inflation
>>tolerates a temporary increase in inflation
Mike’s conclusion is that if they go down this road, there will be nothing controlled about it. Hyperinflation will result.
Maybe the more things are digitized they could control the inflation or direct it here and there with money chokepoints? There would be real world consequences of course, some toothpaste would burst out of the tube all over the floor here and there as well.
“Shares of the sputtering rental car company Hertz, which filled for bankruptcy protection last month, rose as much as 40% Friday to $3 on news it wants to sell investors nearly 250 million additional shares on top of the 150 million available now. And that’s just latest spectacular rise in the struggling company’s stock.
“Shares are up a staggering 400% since May 26, the first trading day after Hertz drove into bankruptcy court with $19 billion in debt and just $1 billion in cash on hand….
“This is not how the stock market is supposed to work.”
https://www.cbsnews.com/news/hertz-stock-offering-price-bankrupcy/
It is strange. But with the Federal Government bailing out everyone, perhaps hope springs eternal.
“Due to the coronavirus pandemic farmers in Italy have resorted to chartering private planes to bring back seasonal workers to help with the summer harvest…
“After the COVID-19 crisis closed Italy’s borders many farmers were left with a stark choice – pay themselves to bring the workers back legally, or risk a reduced harvest and face the financial consequences.”
https://www.euronews.com/2020/06/14/italian-farmer-s-stark-choice-pay-to-fly-workers-back-or-go-bankrupt
“Italian consumer prices for May contracted -0.2%, both on a month-on-month and annual basis. That is worse than the previous readings of -0.1%.
“The final reading for EU-harmonised consumer prices for Italy have also been revised lower from -0.2% to -0.3% on an annual basis.” [from Guardian live updates]
I wonder what they’re paying for chartered flights for those migrant workers, and what that would translate into in terms of increased wages for a farm hand / labourer?
When will countries start realizing they have to stop relying on imported labour, I wonder…
Cheers,
-GBV
According to the article,
“The workers usually return to their hometowns during the winter months and fly back for the next cycle in early spring.”
Presumably, whoever was paying in the past for these flights would now pay for the charter flight costs. The problem is lack of commercial flights.
Labour arbitrage is a curse, and its main victims are ones fellow countrymen. And the solution is simple. First, ban the importation of labour. Secondly, require every able bodied person on welfare to take any unskilled job on offer, or lose their welfare. I remember once meeting a man in a wheelchair, who made a living reading books aloud. He was creating audiobooks for the blind. If he could be a valued, productive, and compassionate member of society, so can almost anyone.
A lot of able-bodied people are taking care of someone else: children or elderly relatives. This doesn’t really go into the calculation. Also, the cost of transportation to a job doesn’t go into a calculation. Often a car is required because public transport cannot be made to work. When the cost of substitute services is added as well as the cost of transportation, the calculation often leads to a negative benefit of working.
The effect of COVID-19 seems to make public transportation more of a problem. Even taxis or Uber rides are a way of spreading COVID-19. This adds to the problem of finding a suitable job, if someone has pre-existing conditions that make COVID-19 worrisome.
Gail, I accept without reservation your first point. I’m not sure what to do about it, but perhaps some pooling of resources would help. In my day, children were often looked after by grandparents (as I was) so that the parents could work. And sick or infirm people were cared for by younger members of the family, for instance grandparents by granddaughters.
On your second point, I respectfully disagree. If a company can charter aeroplanes to transport workers, they can surely afford coaches, or even pickup trucks (quite common in Singapore, the unofficial rule being you could stuff in as many workers as you liked, provided they could all sit down) to bring locals to the worksite.
After much thought, I believe we should factor that virus out of our calculations. There is no vaccine, no cure, and the only effective defence is people’s common sense, and then their immune systems.
“The Pandemic Hunger Crisis Is Only Just Getting Started.
“Regional [US] food banks—which are intended to be safety nets, not main sources of food—fear that they won’t be able to meet the swelling need.”
https://www.theatlantic.com/health/archive/2020/06/pandemic-food-banks-hunger/613036/
This has been a recurring theme over the last few weeks in the UK MSM. Once the 10.2 million people currently on furlough in the UK find their job no longer exists when the furlough ends (not all of them but maybe most of them), then we will find out what mass hunger looks like.
I expect that a lot of people are assuming that the government will “do something about” the problem. If enough supply lines of food have been cut off for one reason or another, there will be a physical shortage of supply, relative to what is needed. No amount of extra printed money will fix the lack of an increasing number of grocery store/food bank items.
Gail, a phenomenon worth watching closely. Historically, the number one trigger of hyperinflation has been a drastic shortage of food. If you are hungry, you will pay whatever it takes, even if it takes a wheelbarrow.
food is the ultimate energy resource
money is the conversion factor
so if ‘ultimate energy’ is scarce, then more and more money must be converted to get hold of it. People believe in the value of ‘money’ so those who own the moneyprinting presses will increase output for no better reason than they have no alternative.
people must have wages
The mental function is of course Dickensian—something is bound to turn up.
If it doesn’t, then the result is ‘misery’ and violent readjustment until the money-energy equation rebalances.
The ultimate problem is of course money itself.
But we decided 10k years ago that money was a good idea so now we are stuck with it
I am sure that the big hope is, “Perhaps some of this printed money will bid away some of the food that some other country is producing.” This only works if there are food surpluses to bid away. It probably helps as well if the country has something to trade in return.
“Developing economies borrow more despite debt relief initiative… G20 appeal for investors to restructure fizzles out as capital inflows return.”
“Data collated by the Institute of International Finance, an industry association, show that developing economies are financing their coronavirus-driven deficits by accessing the global financial markets, rather than by attempting to restructure their existing borrowings.”
https://www.ft.com/content/54c545aa-01b5-4e95-8adc-e680f5d82be1
“Indonesia will use unprecedented quantitative easing and other emergency monetary and fiscal policies for as long as it takes to recover from the coronavirus pandemic, according to the country’s finance minister.
“With the private sector in retreat after weeks of lockdown, massive state spending was needed to shore up the economy, Sri Mulyani Indrawati said. This was despite concerns among investors…”
https://www.ft.com/content/9420eee8-5ee9-4c7e-ad67-b27d4b1ac539
Indonesia? Quantitative easing? This cannot help its currency relative to other currencies.
If more debt is available, I can see why countries would go after this. They can use the proceeds of the new debt to make payments that are required by old debt, keeping the system going a while longer.
“Unprecedented government interventions to offset the economic impact of Covid-19 have driven the level of global debt close to the peaks seen in the second world war, according to Goldman Sachs.
“Economists say this raises big questions about how the burden of servicing the debt mountain will be shared; how the related surge in bond issuance will affect markets; and what the long-term impact on growth will be.”
https://www.ft.com/content/ee91ec43-1ee9-4770-8164-036615c9582a
Growth? What growth?
https://www.cnn.com/2020/06/15/asia/coronavirus-beijing-outbreak-intl-hnk/index.html
“Beijing is reintroducing strict lockdown measures and rolling out mass testing after a fresh cluster of novel coronavirus cases emerged from the city’s largest wholesale food market, sparking fears of a resurgence of the deadly outbreak.”
“The Chinese capital reported 36 new Covid-19 cases on Monday, bringing the total number to 79 since a locally transmitted infection was reported on June 12 for the first time in nearly two months, according to the National Health Commission.”
Probably much worse than they are admitting to, knowing the Chinese (and, indeed all governments).
Also, the inability to distinguish who really has this illness.
“The fragile recovery in China’s economy is pointing to a long road back for the rest of the world too.
“A string of top-tier data all showed that China’s factory output, consumer spending and investment continued to improve in May, but there are few signs of a broad based rebound needed to spur a V-shaped recovery.”
https://www.hindustantimes.com/business-news/china-s-slow-recovery-points-to-hard-road-back-for-global-economy/story-fFoN0ArdtXshZvAUOkTFsK.html
“Many top investors are either reducing their Hong Kong exposure or taking steps to ensure they can withdraw assets at a moment’s notice…”
https://www.japantimes.co.jp/news/2020/06/14/business/economy-business/hong-kong-economy/#.XudI8kVKjIU
“Singapore’s total employment contracted in the first quarter at the fastest pace on record, due to a significant drop in foreign employment, the Manpower Ministry said Monday.”
https://www.marketwatch.com/story/record-contraction-for-singapore-employment-in-q1-2020-06-14
People with wealth evidently want to leave Hong Kong. China really relies on Hong Kong for the role it plays, so this is not good news for Hong Kong.
Ultimately, problem is not enough people with jobs. According to the article,
“China’s official survey showed that China’s big companies are yet to return to full capacity four months after the government started to lift social distancing restrictions. The challenges are likely to be greater for smaller firms. The constraints are driven by the demand side, both weak domestic consumption and external demand.”
Constraints are demand side = not enough people with jobs that pay well enough. Also, too much shut-in demand from people afraid of COVID-19.
The near future?
As the riots continue, some parts of the cities will burn down to the ground.
As they defund the police, other parts will turn into no go zones, controlled by organized crime.
People that still hang on will protect their own neighborhood and live in fear of the increasing chaos and poverty.
Some parts of the cities will still function and look normal with police protection.
Or there will be a vaccine and life will return to normalcy.
Or there will not be a vaccine. And life returns to normalcy, more or less.
Seems like the Germans in 1913 arguing who their next Hapsburg ruler is going to be.
I get your point, Duncan, and I am sorry to be pedantic, but the Germans were ruled by the House of Hohenzollern. It was the Austrians who were ruled by the House of Hapsburg.
Instasoondoomer?
If the riots continue, businesses will leave, as will wealthy residents. There will be fewer jobs for everyone, and the jobs will be lower paying. The cities will likely default on their pension promises, unless they receive some sort of bail out. Tax revenue will be lower; schools will likely be poorer. There will likely be fewer grocery stores and more “food deserts.”
Perhaps some OFW regulars would like to peruse five magnificent paintings by Thomas Cole, entitled “The Course of Empire”. The last one especially: “Desolation”.
They say the Lion and the Lizard keep
The Courts where Jamshyd gloried and drank deep ..
If the economy is all about energy and energy flows, as most of us here believe, then taking the concept of money flow = energy use a step further, we could look at future energy use or needs.
If the total debt = total future energy payment, then we could do some rough calculations on needed energy requirements to pay off debt. Taking US govt debt alone, and allowing oil to be $60/bbl, then the current ~$25T in govt debt = about 416 billion barrels of oil.
This oil equivalent to pay off debt would be on top of the usual use of oil/energy use, so it would be excess oil needed to clear the debt if sold. Odds of the US coming up with an extra 416B barrels of oil above the ‘normal’ use?? It is obviously an impossible task..
Of course not all energy use is oil, but then again not all debt is govt debt either. Now I’m off to do a calculation on all debt (for world) compared to all energy resources, this might take a while.
Gail do you have any thoughts on looking at debt compared to the required energy resources to pay it off? (yes I know there are many other variables).
It might give an indication of how far into overshoot we are.
The debt ratio to GDP used to be 1:1 today it’s 3:1.
The debt above the 1:1 ratio is the overshoot?
The master resource, though, is water: the empress, queen and goddess of all resources.
With both eyes on energy, we are apt to neglect her; and the message of all the old myths is:
Don’t anger a Goddess, the penalties are apt to be violent……
If the overshoot is $160T and energy is 10% of GDP, then the overshoot is $16T in energy and the rest is commodities, good and services (including water).
You have to factor in the price of the new energy, plus the new debt that it takes to pay for the new energy.
It’s not as easy as you think
our energy needs/supply is rather like knowing the grocery store is 30 miles away, and the only way to get there is to walk. (we used to drive but can’t afford a car anymore)
but you can’t walk 30 miles and back, AND carry enough groceries to last you a week (let alone your family) neither can you walk 60 miles each day because you would have no time left in your life to do anything else.
but this is what we are trying to do with ‘new ‘ energy sources
we are having to spend more and more time in the acquisition of energy and less and less time enjoying the results and benefits of that energy
I think of overshoot in terms of the population an area can support without fossil fuels. In that case, we are into population overshoot of well over 90%. In fact, population overshoot may be 99.9%, if a sustainable population is (0.1% x 7.8 billion) = (7.8 million). We really don’t know how many people the world can sustain, given how depleted resource are and how limited most people’s skill level is with respect to subsistence level farming or hunting-gathering. It may be very low.
I think the question with respect to debt is, “How long can we keep this Ponzi Scheme growing?” Once physical goods and services produced start declining in quantity, there is a big problem. I think that this defines when the system starts falling apart. It doesn’t seem like this can be very far away.
The quantity of future promises is elusive. Future Social Security and Medicare payments are not considered debt. Guarantees on bank accounts and pensions are not considered debt. The value of derivatives is not considered debt. Lots of things go wrong besides debt. International trade for example, and the letters of credit it requires.
“We really don’t know how many people the world can sustain, given how depleted resources are and how limited most people’s skill level is with respect to subsistence level farming or hunting-gathering. It may be very low.”
Indeed, so low in the UK there will be very few survivors here. Elsewhere yes but not here. Putting aside the nuclear power stations and waste cooling ponds that will eventually blow up, I think we can survive that, there is no-one here who knows how to survive with a primitive lifestyle. The only new clothes and shoes hand-made from animal skins and wool? Will the survivors still be anti-social distancing in case they catch a virus? Just kidding.
https://www.worldometers.info/coronavirus/
I got curious about the variations seen between different countries death totals for Covid-19, and although I realize there is not necessarily a direct connection between total cases and deaths, I figured between different countries there should be some consistency if deaths are divided into total cases. Here’s what those percentages are for the following countries:
Saudi Arabia .8%
Russia 1.3%
Chile 1.9%
Pakistan 1.9%
Turkey 2.6%
Peru 2.6%
India 3%
Iran 4.7%
Germany 4.7%
Brazil 5%
US 5.5%
Spain 9.3%
Mexico 11.8%
UK 14%
Italy 14.5%
France 18.7%
Other factors come in to play such as general health of a population, genetic makeup of those people, viral strain variations, etc., but from .8% in Saudi Arabia to 18.7% in France is quite a jump. If we use an average of 10% x 8M cases, it = 800,000 deaths, which is likely more accurate due to many countries under counting deaths to reduce public concern/panic to keep the economy going to a greater extent than if they knew the real numbers. And of course there are the millions of recovered that are still trying to recover but that’s for a different stat comparison later.
There are a huge number of cases that are not reported. The percentage that is not reported probably varies from place to place. That is at least part of the difference.
There probably is a difference in the deaths counted, and that may make some difference as well.
Some of the countries have only recently started having a problem with COVID-19. There are a lot of new cases in the counts that haven’t had a chance to lead to deaths. So that makes a difference as well.
There do seem to be variations on the virus around. Which variation is active in a particular area, may make a difference in how many deaths there are.
Also, we are gradually learning new things. New York State has a lot worse death rate than some other parts of the US, because the rest of the US learned for New York State’s bad experiences. We don’t send still-sick COVID-19 patients to stay in nursing homes, for example, because if the nursing home patients get sick, many of them will die. If there are a lot of nursing home deaths, the death rates (relative to total cases) is likely to be high.
Countries with a lot of elderly people, who do not protect those elderly people adequately, are likely to have high death rates.
This virus is no more important than the other Corona viruses other than for its propaganda value. Forget it. 200,00 added to population each day. The unfit/unwell/unable are being off’ed, as they always have, by natures oldest pruning shears.
Events in history have always been seized by those in a position to do so. There are always that group who think its their time in the sun to ‘save the world’. Meanwhile those in the know never let a good crisis go to waste. Don’t enable them by being an unthinking mob-member. Forget the vaccine pushers; they are scammers. Clean water, good sanitation, good food, stress management; medical science would wither in the presence of these four items.
Go get a dog, go do whatever grabs you, stop cultivating the fear, get a life.
There are more viruses in this world than there are strs in the milky way.
https://www.nationalgeographic.com/science/2020/04/factors-allow-viruses-infect-humans-coronavirus/
Don’t be a useful corona-idiot….the hachet job has been done…enjoy the descent while/where/when you can.
The best healthcare is delivered by:
‘Dr Quiet. Dr Diet. Dr Merryman’.
They weren’t fools in the 16th century.
Caught my eye and lesson to be had by this very sad story….this is coming to ALL of us in BAU magic kingdom land ….as our very own Gail has pointed out much wealth is just an illusion…
Heartbreaking story of rookie trader who racked up $700K in debt: ‘Finance isn’t worth losing your life over’
Published: June 14, 2020 at 5:13 p.m. ET
By Shawn Langlois at MarketWatch
Bill Brewster
@BillBrewsterSCG
· Jun 13, 2020
This is still really raw and I have more questions than answers. But, it’s very important and intersects with what I speak about here. Hopefully my family’s tragedy can help another family avoid tragedy.
Bill Brewster
@BillBrewsterSCG
My cousin in law was interested in investing. He opened a Robinhood account. And, he seemed to be enjoying the markets. As many of us do, or have done, he got interested in options. He believed he had “no margin” selected on his account.
Bill Brewster
@BillBrewsterSCG
· Jun 13, 2020
Replying to @BillBrewsterSCG
So, he began buying and selling options. Fast forward to sometime this past week and his account showed him owing $700k+. How does a 20 year old with no income get access to that kind of leverage/exposure?!
Bill Brewster
@BillBrewsterSCG
The emotional stress from the exposure caused him to take his own life. I don’t feel right sharing this, but I also don’t feel right keeping it from the world.
Why? Because recently I’ve been joking about how much I love DDTG. I’ve laughed at the Robinhood memes.
Bill Brewster
@BillBrewsterSCG
· Jun 13, 2020
Replying to @BillBrewsterSCG
But here’s the truth. AND PLEASE PAY ATTENTION TO THIS IF YOU’RE YOUNG.
The markets are bananas right now. It’s not the time for amateurs. Really really pay attention to position sizing. Stay away from exotic instruments like options and futures.
And the response by the Trading firm.
Robinhood declined to share any details of the trading account and how such outsized losses piled up, but did say that the company was aware of the situation.
“All of us at Robinhood are deeply saddened to hear this terrible news and we reached out to share our condolences with the family,” the spokesperson said
https://www.marketwatch.com/story/finance-isnt-worth-losing-your-life-over-the-heartbreaking-story-of-a-rookie-trader-who-racked-up-700000-in-debt-2020-06-14?siteid=yhoof2&yptr=yahoo
Get emotional prepared to be down and out because we common folks are basically broke and living on debt creation
There is not a debtor prison. if they gave him 700000 monopoly money thats on them. you cant collect whats not there. Take your life for monopoly money?
Very true, unfortunately, the lad was only 20 years old and was overwhelmed by what had happened and panicked or the like and did not want to face the music. Too bad he did not get some help and perhaps as his relative questioned. How was he allowed this amount to trade without a job and other means? I imagine he would be absolved of this loss by the irresponsible trading firm practices. There still may be a law suit by his family against the firm. Not that will bring this young man back.
Where I work a few very young adults and doing online trading….
We might say that we have been living high off the credit granted to us by Mother Nature: but she’s about to appoint an new account manger named – Consequences.
Consequences is pretty hard-nosed and implacable.
All credit facilities will be withdrawn, and the debts presented to us for immediate settlement.
How can they be settled? Only one way to settle Nature’s debt…..
Thanks for this perspective, Xavier! Yes, overshoot is in play here, but folks, at least for the most part, I come in connect with, don’t agree or hear about it….”They’ll come up with something, they have to as before!”, is one response usually have before changing the subject. To be honest, I don’t try anymore in talking about OFW at this point. As Gail has directly pointed out…this is what collapse looks like….
I have three Peak Oil friends, we try and meet up once a year as we are scattered around the country (north UK). This is the only time I can talk to anyone about OFW themes and collapse. Any issues on the table for discussion.
Everyone else I know, no exceptions, it is not just that they don’t know, they don’t want to know. That is the main reason why collapse is always inevitable. People live their lives with no idea of what sustainability really means, prefer to stick their heads in the sand, rather than face reality and make difficult choices in advance whilst there is still time.
Why regret their ignorance? We here are certainly not any the happier for our knowledge , even if our desire to understand is satisfied.
Personally, I was better prepared mentally for the lock-down, as a result of enrolling in the School of Collapse Studies and assiduous attendance at Gail’s lectures; but it has also demonstrated the great limitations of physical preparation – one can’t hold out for long in a real disintegration.
This is just a foretaste.
I find it best not to try to convince anyone who can’t work it out independently for themselves
why?
because ultimately you can’t actually ‘prove’ anything, which is what you will be demanded to do.
bit like religion, you can’t prove or disprove the existence of god, so ultimately you believe what your own version of common sense and peer pressure tells you to believe.
Arguments will lead to ‘when’—you and we don’t know this either, so the denialists flourish and say it cannot be, when every shred common sense says this cannot go on much longer. Some years ago I forecast ‘early 2020s’. but I didn’t forecast the virus. I could be 10 or 20 years adrift
But i freely admit I was saying this 15 years ago—and things are still staggering along, I personally didn’t think they would be—but here we still are with enough surplus energy available to log onto OFW
And as long as your personal roof doesn’t fall it, it is easy to assume BAU. And impossible to convince anyone otherwise
But more and more roofs are falling in, only a matter of time before it’s mine and yours
Well said, Norman. Thank you.
So, I kinda got hooked on this story and found this comment on Reddit
https://www.reddit.com/r/wallstreetbets/comments/h97l9z/how_did_a_teenager_get_700k_in_leverage_from/
As nobody seems to understand a goddamn thing about options. He didn’t have $700k leverage and he didn’t lose $700k. He had a spread, the short leg was assigned, and the long leg hadn’t yet been exercised in his account ledger. His account will be back to normal by tomorrow morning with a relatively tiny loss or even gain.
Please understand this. It’s very likely to happen to any one of us. It’s nothing to be alarmed about. You need to understand the order of assignment to exercise and what your account balances may display while it’s processing.
catchyphrase
Imagine killing yourself literally over nothing..
Wow, that’s really tragic if true….don’t play with the Big Boys on Wall Street when learning with your own skin….
FRENCH PRESIDENT MACRON: FRENCH REPUBLIC WILL NOT ERASE ANY NAME OF ITS HISTORY, WON’T TAKE DOWN STATUES
He’s begging ANTIFA to riot, burn and loot.
In China a lot of companies have mysteriously burned down to the ground.
In the US ANTIFA did the job.
Found this, it is a headline and the writers of headlines always try and catch your attention with outliers so skepticism is not unwarranted.
Basically this article claims truck drivers will not deliver to riot areas. Get a truck in the wrong place and it is tough to turn around.
https://www.zerohedge.com/political/truck-drivers-reject-deliver-cities-defunded-or-disbanded-police-departments
Many drivers own/lease their own tractors, if they are burned their livelihood is gone and who pays is always a question for a trucker, most of the time it is the owner/operator. Interestingly enough many drivers are excons, it is one job that pays they can get.
https://www.trans-tech.net/trucking-companies-are-hiring-felons-to-fill-thousands-of-driver-openings/
Laughing quietly, one has to wonder if prisons offered over the road truck driving training how that would go? Some of the road blocks with patrol cars parked across the road might resemble something out of a good movie.
Dennis L.
I can believe those headlines. We really do depend on truck drivers to get us virtually everything we use or buy. I know that today, many truck drivers do own their trucks. They will not want to be in the middle of a protest.
One commenter (I think on the ZH piece but I could have read it elsewhere) stated that 200 tractor-trailers’ worth of food per day arrives in that area. If only 25% of the runs were to fall through.. that would mean running out in four days. Even if these figures are WAGs, the underlying idea is the same: most people have no idea of scale, nor of the tight tolerances under which the system has been functioning.
I am trying to share here, not preach, not be a douche, if I do, please comment, this is a wonderful site, we differ in views, we learn from one another, so a share.
This guy, Kelsey is a pilot, 747 freight and this video has advice in a number of areas. It is 12 min, but the advice at the end is good, get a side hustle, don’t live on your last dollar.
https://www.youtube.com/watch?v=37xhDgf11Gw
He also notes in flying trying to cover up mistakes can lead to fatal results. Our society may be trying to cover up mistakes, it is hard to admit error, the earlier it can be fixed, perhaps the less painful it will be.
We live as a group and even when the group is wrong, today’s survival is probably better in the group than alone which does not preclude eyeing up a neighboring group. Sometimes Kelsey notes it is good to express your concerns in a constructive manner, as in airplanes, life goes on until it doesn’t, then the landings can be a challenge.
Dennis L.
Hi Dennis. The video reminded me of what Captain Sullenberger had warned when he spoke before congress of the challenges the airline industry faces in hiring experienced pilots. Those pilots (who have already pushed their limits and aren’t in need of mentoring) will likely remain in the military or get out into careers that do not require “a side hustle” to make ends meet. It remains to be seen what will be left of the airline industry as we move forward. But personally, as a retired airline pilot, my tip for future airline pilots is to go into another field. It will never again be the way it was back in the day. Just my 2 cents worth though I may have gone beyond the point you were trying to make here.
https://m.youtube.com/watch?v=8kePiiZ8_YA
Cheers,
DB, a fellow cheesehead from Milwaukee
Kelsey says, “Get a side hustle.” Don’t count on your current job to last. Have something else you can do if your job disappears.
At the beginning, Kelsey talks about not being done until you are 65 or retired. I would argue that we don’t know how secure any of the pension plans will be. Stay in good physical health. It you can keep at least a part time job, that seems to be a good choice.
Pensions recall the old folk song:
‘I leaned my back against some tree, thinking it was a sturdy oak; but first it bended, and then it broke…’
The old English proverbial advice also comes to mind, about ‘Having another string to your bow’, from the days when a bow string might break at any moment – it’s very unpredictable, even the very best string can snap suddenly -and you would die if in battle.
See life as a battle, not a party, and have more than one string: I planned for 5 income-producing activities myself.
Two have broken, one is still working fine, another has just come into play, and a third is yet to be tested.
If they all fail, then at least you have tried.
Almost 20% of US companies are zombies.
https://pbs.twimg.com/media/EaeH9NTXgAER5I3?format=jpg&name=small
I see a turning point, way back about 1999 or a bit later. This is when oil prices hit their low point in inflation adjusted terms. This is when the share of women in the US labor force hit a peak.
https://gailtheactuary.files.wordpress.com/2015/10/10-percentage-of-women-in-labor-force-grew-until-1999.png
Correlation is good, a data point no more no less, no opinion.
1999 median us Income $42,000
https://www.census.gov/prod/2005pubs/c2kbr-36.pdf
1999 Average WTI 19.35
https://www.macrotrends.net/1369/crude-oil-price-history-chart
For consistency assume average per person use 20 barrels – yes it varies, looking for trends with easily available numbers. Each person used $387 in cost of oil,
Percent of pre tax income. .921%, not much.
Cost of payroll taxes, 15+% mostly pre tax.
The number 15 keeps coming up payroll taxes are 15x oil cost.
Of course not everyone in the US works, so double the cost of oil or halve the number working, taxes are 7.5x oil cost.
Oil is not that large a factor in the cost of living. Transfer payments keep coming up. they never go down and each year the threshold where they stop keeps going up.
Kids are mad as hell, if a previous post is to be believed 10% of a group can cause the group to run in one direction, combine hard times for anyone working for less than $100K and the group is off to the races. If this correlates, things are hard to get back in control.
Dennis L.
Oil price is to some extent an index for all commodity prices.
More people working makes goods more affordable; low oil/commodity prices make goods more affordable.
Looks like the collapse kind of started in 2000…or at least the decline.
There definitely is a downward slide after 2000.
Even before 2000, there was a shift toward less robust growth after the US oil peak in 1970. The 1970s were marked by rapid inflation and many women added to the workforce, in part to stay ahead of this inflation. Also, it became possible for a family to have two cars, live in the the suburbs, and commute to work. This was a work-around for children being bused to school across town to promote integration.
The 1980s were buoyed by falling interest rates, which led to rising asset prices of all kinds. People could suddenly become rich by buying homes or shares of stock, and selling them later. At the same time, commodity prices were low, making money go farther. Japan could grow in this period because it could import cheap oil and make lots of compact cars. “Leverage” became important because asset prices always seemed to go up.
The low oil prices of the 1980’s eventually led to the collapse of the central government of the Soviet Union in 1991, because it needed high oil prices to do sufficient reinvestment in oil fields to keep up its production. There was a collapse in demand of the Soviet Union and its satellite countries in the 1991 to 1997 period, as many of its inefficient factories were closed and more people emigrated. These low commodity prices were good for consumers, but the prices were really too low for commodity producers.
To try to fix the lagging demand (low commodity price) problem, it seems to me that new organizations were formed to encourage world trade. The World Trade Organization began operation in 1995. This would hopefully increase demand for goods and services and indirectly increase the profits of companies producing commodities. The Kyoto Protocol in 1997 had as its stated purpose reducing CO2 emissions, but it also seems to me to be a way of increasing international trade. It encouraged countries to move their manufacturing to less-developed countries (with lower wages and energy resource of their own).
By 2000, this additional trade was having an impact on job availability. This seems to me to be a reason that the share of women working hit a peak.
It wasn’t until 2001, when China joined the World Trade Organization, that world demand could start rising more robustly, thanks to China’s large supply of cheap coal and the many consumers it added to the world market. The price of oil and other commodities could start rising again, but the availability of jobs in the developed countries tended to stagnate. Other people elsewhere could produce goods and services at lower cost.
“The number — or density — of functional spikes on the virus is 4 or 5 times greater due to this mutation.” “…was nearly 10 times more infectious in a laboratory setting…”
Several months ago, early in this pandemic when the idea of this virus having been a laboratory spliced virus from naturally occurring strains came to the fore, I wrote a message asking; If it was lab made, would the virologists involved in that process insert sequence/s to give the virus a better capability to mutate advantageously? I don’t even know if that’s possible, but that mutation described above being such a huge improvement to the transmission of the virus, again makes me wonder if that’s the case.
Of course we still have the two camps; the one’s saying it occurred naturally and those saying it was lab made and I acknowledge that, but I’m in the latter camp particularly with this type of news.
I would ask if we really have the capability to make a virus mutate in a particular way.
It seems to me that if an advantageous random change takes place, it will tend to drive out competing viruses that have not mutated in as advantageous pattern. It may be for this reason that one epidemiologist, Michael Osterholm from the University of Minnesota, has remarked that the second wave of the virus tends to be worse than the first. It may be that even a few months into the epidemic, it may take a turn for the worse.
https://www.bluezones.com/2020/06/covid-19-straight-answers-from-top-epidemiologist-who-predicted-the-pandemic/.
https://tg24.sky.it/salute-e-benessere/2020/06/13/coronavirus-sostanze-naturali-cellule?social=facebook_skytg24_link_null. People’s bile acids contain protective substances. I deduced from this that this TUDCA acid. In my opinion it could really help protect cells. If you use tudca whit NAC Better too
This is a summary in Italian of a study that is available in English. The non-peer reviewed English language article is here.
Hijacking SARS-Cov-2/ACE2 receptor interaction by natural and semi-synthetic steroidal agents acting on functional pockets on receptor binding region
The summary article you link to mentions various substances that can stop the activity of the virus that causes COVID-19 if the viral load is not too high. In particular, it talks about bile acids created in the liver and intestines by the metabolism of cholesterol. It also talks about substances found in foods such as licorice and olives that can have a similar effect.
The abstract of the academic article says (among other things):
I don’t live in London, but this caught my eye
The Telegraph
Albanian gangs are waging open warfare on London’s streets, experts warn
Charles Hymas
June 13, 2020, 10:49 AM EDT
Open warfare between Albanian criminals is being waged on the streets of London as they attempt to increase their drug-dealing territory.
In the latest attack ten days ago, two men were shot in broad daylight as they drove through Barking in East London, a stronghold of the Hellbanianz, a notorious Albanian crime group.
It follows murders of five Albanians in the past year as the gangs tighten their grip on the UK cocaine market, estimated by the National Crime Agency (NCA) to be worth between £9.4 billion and £11.8 billion annually, and over £25.7 million daily.
Cocaine use up in UK
The NCA says cocaine consumption in England, Wales and Scotland has increased by at least 290 per cent since 2011 to 117 tonnes per year.
“Criminals from Albania have established a high profile and degree of influence within UK organised crime (and) are increasingly expanding their network of influence, with considerable access to the UK drug trafficking market, particularly cocaine,” said an NCA spokesman.
On an Instagram page, seen by The Sunday Telegraph, an Albanian colleague posted a video of the shooting’s aftermath with the warning: “The Albanian boys in England are lazy and don’t work in an honest way. On their mind is one thing – just to sell drugs.
Live here in S Florida and we have our drug industry… unnoticed by myself other than the local news
Imagine drug use will increase now because of this Depression and with it crime scarry
Defund the police!
In the past, Dmitry Orlov has talked about young people earning “protection” money by working as voluntary militia, if the police aren’t really functioning. Some might call this a “shake down,” however.
A possible explanation for the big differences in infection rates between the East and the West:
On CNN: A mutation shows why the coronavirus is such a formidable foe
By William Haseltine, a former Harvard Medical School professor and founder of the university’s cancer and HIV/AIDS research departments.
New information from unreviewed research manuscript:
Gail,
It does not appear we have good data on preexisting conditions prior to becoming ill. In the US the population also appears less healthy than in photos of the early twentieth century, movies of the 1950’s also appear to show healthier appearing people. Shopping at places such as Menard’s, Sam’s or having a sandwich at a local pub, the people are very obese, not over weight, obese.
In the 1960’s, James F. Crowe, now deceased, made a comment in class that modern medicine was not good for the population as a whole while it was wonderful for the individual. It is easy to research him, he was very well known and respected in genetics.
Anecdotally it appears some are not affected by this virus, we really don’t seem to understand how to treat it,
West Coast population density has always been lower than East Coast whether that is important is mere speculation, the initial area of West Coast infection appears to have been a nursing home as I recall.
Our immune system evolves to deal with infection, judging by our numbers, it works very well. Many will come out of this, they will mate, their offspring will be better adapted, thus it has always been.
Philosophically this disease has been a shock to our belief system – finding a policy to make everything right again may not be an option, Kubler Ross postulated a series of emotions dealing with death, for some this virus is death, very unpleasant.
Dennis L.
Key words:
original authors speculated
But it is a RNA virus.
RNA tend to mutate, I understand. This is a link to the preprint paper itself.
https://www.scripps.edu/_files/pdfs/news-and-events/The%20D614G%20mutation%20in%20the%20SARS-CoV-2%20spike%20protein%20reduces%20S1.pdf
One thing this paper says is
Later, the paper says (after reviewing how the mechanism works):
All ok in Atlanta?
Gail doesn’t eat much meat, so a burnt-down Wendy’s may not be too big of a loss… unless, like me, she enjoys a nice Frosty dessert in the hotter summer weather…
https://m.youtube.com/watch?v=kYMlxZ614OQ
Delicious! 🙂
Also, not sure if this has been posted yet or not:
https://www.zerohedge.com/political/activists-demand-atlanta-police-chief-resign-over-latest-police-killing-unarmed-black-man
Cheers,
-GBV
I understand that she did resign.
This is a CNN Report: A charred Wendy’s, an officer fired and a police chief steps down in the aftermath of Rayshard Brooks’ death
Except he *was* armed, with a Taser he stole from one of the officers…
https://www.zerohedge.com/political/white-woman-filmed-setting-fire-atlanta-wendys-after-latest-police-killing
The only white woman I know in Atlanta is… Gail Tverberg 😐
We already know Gail is not a fan of meat… I think it may be prudent for me to go back and search through Gail’s articles to look for any subtle clues that she has an intolerance for Ginger mascots or delicious frozen dairy desserts.
I only hope I can discover her fiendish plot and put a stop to it, before it’s too late…
https://m.youtube.com/watch?v=RXVE01oOTAM
Cheers,
-GBV
Strange! Hard to tell the identity of the woman, with the mask and her hat. White and probably fairly young. Not overweight.
“The coronavirus pandemic has indeed delivered a “swift and massive shock” to the global economy, as World Bank Group Vice President Ceyla Pazarbasioglu so rightly put it, and already caused the widest collapse since at least the recession of 1870…
“…the economic trauma from this particular crisis will not even begin to recede till there is a laboratory breakthrough and a reliable vaccine is developed. And since nobody has yet got any idea how long that crucial process might take, markets are simply unable to discount the worst case scenario, making it impossible to tell accurately just where the bottom might lie.”
https://www.brecorder.com/news/1004209
“The coronavirus pandemic is causing bond yields to decline around the world. Central banks are slashing monetary policy rates and supporting government budgets by purchasing sovereign bonds.
“If this so-called death of yields becomes a trend, interest rates will begin to lose their function…
“Other side effects include the likes of pension funds and insurance companies not being able to raise enough profit by investing in bonds. They would have to invest in equities, forcing them to take higher risks. Banks would have to lend at lower interest rates, leading to lower profits.”
https://asia.nikkei.com/Spotlight/Datawatch/Death-of-yields-puts-countries-at-risk-of-Japanization
A lot of assets are worth a lot less. Not as many businesses can operate. Many tall buildings are unneeded. Defaults are certain, even apart from the low interest rates. The defaults also affect pension funds and insurance companies. It is not just a low yield problem.
“…the economic trauma from this particular crisis will not even begin to recede till there is a laboratory breakthrough and a reliable vaccine is developed.”
Don’t you just love how they are conditioning the Plebs for a “forced” vaccine.
Our success rate with a regular flu vaccine has not been very good. This virus was not supposed to mutate as much, but I just posted a link indicating that it indeed already seems to have mutates. The Europe and US seem to have a much more contagious strain than Asia. In fact, I wonder if the early West Coast virus was the less virulent variety, leading to the early success of Washington State and California in keeping the number of infections down.
RNA viruses easily mutate, almost every replication, but this one is quite stable.
Only about 20 base points, on a virus that has 29000 base points.
Noise in the system.
With its ease of replication, there is not much pressure—
Duncan advocates mandatory vaccination and his arguments reflect that bias.
Vaccinations are totally overkill. Simply exterminate the virus from the face of the earth with testing and mandatory face masks if a new pandemic is in its beginning.
Testing doesn’t work well enough and costs far too much. Also, animals catch COVID-19 from humans. The latest animal that catches it seems to be minks; they also transmit it back. How does a person test all of the animals that might be involved.
We are likely going to have a pandemic that never completely goes away. It comes and goes in waves, but we really cannot fix the problem. We can, however, destroy our own economy by trying to fix the problem. We can make businesses tremendously inefficient, for example.
The “vaccine” will suddenly be “tested” and ready to go when they finally have the RFID operational.
It won’t matter whether the vaccine is effective, especially when the unvaccinated have equal near equal response to the virus.
“…across Britain, as millions of ordinary people have tried to safeguard their health, they’ve also lived in dread of lockdown’s economic impact.
“Yes, this is a unique, government-imposed depression – which I’ve seen some commentators refer to as “artificial”.
“But the economic and human fallout – soaring debts, the gnawing worries about financial insecurity, the psychological devastation as firms are crushed and countless futures shattered – is the same as any other economic nose-dive in history. Except this one is much deeper.”
https://www.telegraph.co.uk/business/2020/06/13/lost-lives-cost-economic-disaster/
“London does not feel like a City ready to burst into life when the non-essential shops reopen on Monday. My bike ride to the office this week remained an eerie cruise through deserted West End streets that in normal times are the centre of the capital’s consumer economy.
“The same is true across the country. When shops reopened in Northern Ireland on Friday, there was no throng in waiting.
“Many of those consumers lucky enough to have secure jobs they can do at home have used lockdown to pay off household debts and boost their savings, but they aren’t about to go on a spending spree to kick-start idling businesses. They know hard times lie ahead.
And anyway, many are still justifiably worried about the risk of catching coronavirus.”
https://www.telegraph.co.uk/business/2020/06/13/time-running-cut-2m-rule-save-high-street/
“The unemployment rate in Kahului [Hawaii] skyrocketed to 35% in April — nearly 10% higher than the national unemployment rate at the peak of the Great Depression — and the highest of any metropolitan area in the U.S., according to the latest data available from the Bureau of Labor Statistics.”
https://abcnews.go.com/US/ghost-town-tourism-plummets-coronavirus-hawaii-grapples-great/story?id=70880589
“… statewide up to 25% of Hawaii’s restaurants could go under.”
https://www.hawaiinewsnow.com/2020/06/11/unable-fill-its-dining-room-landmark-top-waikiki-is-pandemics-latest-casualty/
Hawaii depends to a huge extent on vacation and convention travel. It doesn’t make a whole lot for itself. It also has no cheap source of electricity, so it is hard to compete making goods that require electricity.
“Australia’s vast swathes of farmland produce enormous quantities of food each year, delivering more than the nation can consume… Yet, during the onset of the Covid-19 outbreak, Australian stores experienced sudden shortages of staples such as flour, rice, mince meat and sugar…
“The shortages were a surprise for Australia, which is a global food bowl, with no lack of supply. It is the world’s second-largest exporter of beef, fourth-largest of sugar and 10th-largest of cereals.
“But its production process – from seed to table – is often dependent on the input of foreign suppliers.”
https://www.straitstimes.com/asia/australianz/covid-19-exposes-vulnerability-of-australias-food-security
“Circle your calendar for the end of September: [the Australian economy is] approaching an economic cliff in 100 days.
“The time of year we’d normally allot to football finals will see billions of dollars in financial stimulus end — programs supporting millions of workers, apprentices, small businesses, renters and people with mortgages — almost simultaneously.
“”It’s a bit like trying to whip out the tablecloth from under your set of china,” warns economist Nicki Hutley.
“”It’s not going to come away smoothly — there’s going to be crashes and broken plates everywhere.””
https://www.abc.net.au/news/2020-06-12/australia-100-days-out-from-economic-cliff-coronavirus-supports/12345710
I am afraid quite a few things will be going wrong by September, outside of Australia as well as inside.
It is hard for people to see how dependent processes are for inputs from around the world!
Most of the events or things happening in the world, be it geological, biological, social or economics, there is an element of “lag”. It takes some time ranging from a few hours to few thousand years before the effects can be seen or felt. Examples will be the food poisoning or how CO2 causing higher temperature(?).
The very first visible sign of trouble started on 24th January when Wuhan locked down. It is just less than 5 months ago although it felt like an eternity. Lock downs eliminated businesses that were already on the verge of failing even the lockdowns. Those who survived the lockdown are now being tried and tested to see if the “new normal” with social distancing, lower disposable income, etc will impact them. Of course, it will impact them because no legitimate business will survive with 50% capacity or revenue. We are not even pass the “lag” for shutdown when the next problem starts : riots.
With the riots coming in thick and fast, the “defunding” of law enforcement and all the actions that is not particularly friendly to the sustenance of a legitimate economy, this will only compound to the lockdown that are still being worked through.
There are unintended consequences stated in the previous paragraph. The most important one will be “sapping the confidences of main street”. Police may not be keen to do more policing, the mobster may be more eager to commit crime. CHAZ may send a bad precedent for the society, other countries may look at USA with a different view now (hey! What happened to the HK protest?). People always has it easy – no problem, move the business away, set up a new shop elsewhere. It is so easy to talk. All these may not even be possible to happen. It is so easy to relocate your family? How about moving a 200-employee business to another location? A lot of people, especially those “armchair generals” like to talk about things that are not realistic and practical. When decisions are made by these people, it has a big effect with a lag. No one will know the effects until we are hit by it. Do you think businesses will have confidence in setting up businesses or expanding in Seattle when they don’t even know if the police force will exist next year? Or maybe there may be business-unfriendly policies enacted? Yes, you can leave but it takes time to move out the people. Maybe a few years? Do we even have that kind of time.
While we are still going through the effects of the first lockdown like increased default in loans, bankruptcy, massive demand drop, unemployment, etc; we are again compounding it with the effects from riots (in USA). Businesses hates uncertainty and right now, everything from stock market to main street economics are brimming with uncertainty. Flights are cancelled, cars are not sold, vacations are not snapped up like hot cakes, deflation is everywhere and people are not shopping like crazy (see people flock to beaches and recreational public places, not shopping malls). This happens everywhere in the world.
While USA is grappling with the second issue (riots), it may face the third issue – second wave of corona virus. We don’t know how bad it is and how people will react. Do note that when you interview those who are middle class and above, you will find that a large majority wants a lockdown (remember the polls done earlier)? Historically, middle class or lower and not really represented in the decision making of the government. Women are not allowed to vote or have a say in ancient Rome. So, why should the government listen to them now?
So, maybe there will be second lockdowns, localized lockdowns or no lockdowns. I don’t know but whatever it is, if it happens now (likely? Beijing has some area under lockdown and some states, cases are rising), it will again compound with the riots and first lockdown. It is really happening too fast and we just don’t know how all these will add in viewing that it has not be digested through the system yet (socio-economic system).
Sit back and think hard.
1. First lockdown – what did we do different to encourage the business to operate. Did it really help? What are the good news that are coming in, if any? Car sales are still down, passenger flights are still empty, conventions and meetings are gone, vacations are localized and cheap and local governments are still adamant on social distancing. Moving forward 2 months, what will happen?
2. Riots – what will happen to the morale of the law enforcement? Business confidence? Anyone address this issue or the government is just letting it fall on where it may be? Are solutions available? Disband police is not a solution
3. CHAZ – what impact does it have on USA? Anarchy? Can people trust the government, local and federal? What positive things that can happen from here?
4. EU – the disunited EU – what can happen and what are the positive thing that has been done to address this? What changes will we have on a positive side 2-3 months from now?
5. Deflation – Same thing – what has been done to address this or was it left on its own? Are the steps effective? Will this problem be solved?
6. Trade wars, Stock market, low global trade and all sorts of issues that we have – same questions need to be asked (questions as in questions 5)
If the answers to the questions above are “no”, then what do we expect ? Do we expect that things will just automatically getting better? Did anyone think about compounding effects? (1+1=3) It is the reverse of synergy.
Wolfstreet reported that in 5 weeks, USA added USD1T in debts. 5 weeks. Stop and think. 5 weeks. Is it really a coincidence that Nixon removed the gold window, increased debts tremendously (in the following decades) at the same time that USA hit peak conventional oil?
How long is the “lag’ from hitting peak conventional oil to seeing the effects? How long is the lag for the massive accumulated debts worldwide? Are we seeing now the effects of 2004 peak conventional oil? A 16-year lag? Have we seen the real effects of papering over 2007/8 financial crisis? Did the lag just came in ?
It will be a perfect ending to the human civilization where in 2020, all those “bad things” that we humans did, be it environment, economic, social or finance (like debts, peak oil, mismanagement, etc) came upon us and bite us hard; where COVID19 just made it sure that all the “lags” come to an end. Karma is a bi*ch.
Your comment made me think back to 2005 or so, reading about peak oil, and related topics that were all very new to me then. I would follow the monthly output numbers and wonder if “the peak was in”.
It seems a little silly to me now to have done that, but as you say “Time lags”. It’s a big system with massive inertia, composed of people with opinions that do not change overnight, even totally resistant to facts and data that can be provided.
https://www.youtube.com/watch?v=OlaTeXX3uH8
Great comment, CTG!
Saludos el mar
CTG, #5 Deflation:
A recent machine tool auction in the Twin Cities was very strong, lathes that normally would sell for $2,000 went for >$4,000-6,000 and are entirely manual, not cnc, a band saw for cutting steel which can be purchased new for $1K, went for $1.1K, the difference being it was was American Made, its clone replacement is not quite as heavy, in metal working heavy means accuracy. Large cnc saw went very high, large American made CNC machines sold very well; moving them costs thousands as it is common for them to weigh >20K pounds, not all mill rights are equal, damage is always a concern and hugely expensive to rectify. The entire auction was very strong, the plant had maintained everything very well. What goes cheaply, always, is electronics.
Steel at suppliers is very expensive, aluminum is very expensive, copper is very expensive – yes mining prices are down, stuff one buys is costly. While in the cities I purchased a 15″x15″, 12 ga hot rolled steel sheet which was $20 with sales tax.
At a local Menard’s a nail gun which recently sold for $175 is now $249. When I asked the man stocking the shelves he related there are not enough workers able to produce goods.
Building materials at Menard’s are very expensive, I am not keeping track in detail but good replacement windows which I am using have gone from less than $690 to $769 over the past year. A small bag of hardware that last year was $20 now seems like $30 and I am there often.
In the US sales of farm tractors without DEF and with fewer electronics are strong – they can be maintained. Retail sales of agricultural equipment have slowed, dealer maintenance is very costly, parts are very costly.
Housing in Rochester MN is strong, prices are up not down. Interest costs are down, that may correlate, few houses clear cash with no financing so difficult to determine what real value is.
I receive regular reports on farm land and associated housing, it has held its own, anecdotal reports have more remote housing being sought after and rising in price. My sense on farmland will be the difficulty in finding people sufficiently knowledgeable to farm it. Change the depth of planting corn by 1/2″ and yields can vary 14bu/acre. If the closing wheels compact the soil too much on the sides of the row, the roots grow in the line of planting and much less laterally, the plant is more subject to wind damage nearing harvest. Planters are now very expensive and very complex, tractors to pull them need to be very large and complex, maintenance is extremely complex and expensive, the electronics is locked down and not serviceable by other than factory technicians.
Autos are very soft, dealers will now bring a car to your house to test drive. My sense is once the excess inventory is gone, prices will go up. Cities dealers seem more desperate than local dealers. There are no good deals on work trucks, say 3/4 ton and up, the deals are on tricked out half ton grocery getters with decreased carrying capacity due to all the stuff on the truck itself.
Stocks are very expensive in the US, bonds are very expensive in the US.
Don’t follow dogs, it would be interesting to follow the price of a German Shepard in the US, my guess is up, dogs are expensive.
Lawn care costs increased this year, jokingly said, the mowers appear to exceed the posted street speed limits.
At a local pub where I have eaten over the years, recently had a glass of wine and always order the same food, my tab went up $2.00 last visit compared to pre COVID.
In my world, prices are up, and up significantly.
Dennis L.
Thanks for your on-the-ground report. I think the higher prices to a significant extent reflect broken supply lines. The commodity prices that producers are receiving are low. If they were higher, the farmers in your area would have money for fancy new hard-to-maintain tractors. Part of the problem is the complexity of the systems; you can’t fix the new systems yourself.
By the way, readers who are not aware, “the cities” refers to Minneapolis-St. Paul, in Minnesota lingo.
CTG, what we need is a good vaccine against the virus to see if BAU can return or not. To that end, I saw Fauci in a YouTube video in which he is optimist because he says people already have an immune response to the virus, so they will have one for a vaccine. He also said they aren’t waiting to see if a vaccine works or not, the US govt. is stockpiling mass quantities of certain top end vaccine candidates so once they know which one works, there won’t be lost time making millions of doses. I actually came away from that more optimistic than I had been. The big question is how long before they get one right and what might happen meanwhile.
Meanwhile, the Lord of the Flies human factor in which both sides of every argument can be endlessly bantered about goes on with those like Bolsanaro saying the virus is a weak flu and the other camp concerned about what might happen to them if they get it. They are having a terrible time in Brazil, and he was telling people at a rally to go to the hospitals and try to get in to see the rooms, because he said they are empty, because the whole thing is made up.
What is correct is once there is a vaccine that works, the fear will begin to ebb and the world economy will come begin to churn again. Then we’ll know better what damage to it has occurred.
Vaccine is bot coming anytime soon. It is just a way to keep hopes high. I have done a lot of read up and my brother is also in this line of work. He said the most optimistic will be 18 months without any red tape. Unlikely.
People need hope. Without it, there is no life to look forward to.
By the way, we sont have 18 months of this serious “no good news coming” environment. Name me one good news please. Like I said crashing 87% instead of 95% (an improvement of 8%) is not good news.
It has been a few weeks since I watched this video, but Dr. Tenpenny is one of several middle-aged female doctors and virologists based in the USA (I have watched their videos on YT) who have stated clearly there might be a vaccine or several but they will not work. Watch the video for reasons:
Dr. Tenpenny: This is The Biggest Scam Ever Perpetrated on The Human Race…
I hope this isn’t affecting you too much directly, Gail:
“Protesters in the United States shut down a major highway in Atlanta on Saturday and set fire to a Wendy’s restaurant where a black man was shot by police as he tried to escape arrest.
“The shooting incident was caught on video and is sure to fuel more nationwide demonstrations.”
https://www.telegraph.co.uk/news/2020/06/14/atlanta-police-chief-resigns-fatal-shooting-black-man/
“Riot police fired teargas to prevent thousands of anti-racism protesters marching through central Paris on Saturday, as a wave of anger continued to sweep the world following the death of African-American George Floyd.”
https://www.theguardian.com/world/2020/jun/13/riot-police-fire-teargas-on-anti-racism-protesters-in-paris
“Boris Johnson has condemned violence by protesters in central London on Saturday as “racist thuggery” in a post on Twitter. “Anyone attacking the police will be met with full force of the law. These marches and protests have been subverted by violence and breach current guidelines,” he wrote.”
https://www.theguardian.com/uk-news/2020/jun/13/rightwing-protesters-clash-with-police-in-central-london
I’m finding it hard to determine exactly what happened in London yesterday – all the reporting is so partisan.
Almost everyone seems to be aggressively reactive and polarised about something or other right now and of course utterly convinced they hold the moral high ground. And it only gets crazier from here.
Best just to pour oneself a nice tall glass of cold Prosecco and bask in the sun, I think.
yup
too early for midges isn’t it Harry?
There were a few of the little swine out before a rainstorm a couple of days ago, Norman, but all clear today.
In summers I recall burning joss sticks in the open doorway of a rented cottage we used to take up there many years ago
useful tip
they are partial to English flesh, scots to them is just monotonous
Harry, I did exactly that at 1830 today, as an aperitif. A tall glass of “Luna Argenta” (‘Silver Moon’, of course). And then a light supper, with one glass of red wine that I am still drinking. Cin cin!
Cin cin, Robert!
I am out in the suburbs, a long way from what happened.
There have been a few (a dozen or so) young people with signs on a corner a couple of miles from my home. They weren’t doing much of anything; nearly all of them were white.
“As the international trade referee prepares to pick a new leader, China and the US are vying to get their man – or woman – into the seat of power.
“Nominations to replace the incumbent director-general of the World Trade Organisation opened on Monday.”
https://www.telegraph.co.uk/business/2020/06/13/superpowers-clash-battle-crown-new-head-wto/
“The real bazooka for the U.S. would be sanctions against Chinese banks. Last year, three unnamed Chinese lenders were found in contempt of court over a probe into sanctions against North Korea, opening them up to the possibility of U.S. punishment. A proposed Senate bill also threatens penalties on banks that are complicit in undermining Hong Kong’s freedoms.
“Limiting the ability of the country’s banks to do business in dollars would be destabilizing to say the least.”
https://www.wsj.com/articles/king-dollar-is-a-deadly-but-dangerous-trump-card-in-u-s-china-fight-11592053200
“This is not the first time that globalisation is facing a serious threat to its existence. In the 1930s, globalisation did, in fact, come to an end with the onset of two world wars which brought the notion of global trade to a halt.”
https://timesofmalta.com/articles/view/2020-the-year-of-deglobalisation.798183
“The international trade in goods is expected to nosedive by 20% this year after a 5% drop year-on-year in the first-quarter and what could be a 27% plunge in the second-quarter, says the United Nations Conference on Trade and Development (UNCTAD).”
https://salaamgateway.com/story/pandemic-hit-global-merchandise-trade-could-plunge-20-this-year-un
Wow!
Globalization could largely cease again, but with a much more devastating result.
“The immediate past Emir of Kano and former Governor of the Central Bank of Nigeria, Muhammad Sanusi, has again said it is inevitable for Nigeria to be bankrupt with its current governance structure, which he described as too expensive and unsustainable…
“Sanusi said when he was the CBN governor and the price of oil was over $100 per barrel, the government at the time spent 80 per cent of its revenue on salaries and overheads. “Now, I’m sure that with the shortfall in revenues and where oil price is, after debt service, we probably have to borrow to pay salaries. We have got to look at that structure,” he added.”
https://punchng.com/nigerias-governance-structure-set-up-for-bankruptcy-sanusi/
“Plunging oil prices and collapsing state revenues have seen Nigerian authorities vow an end to a controversial fuel subsidy scheme long criticised as a graft-ridden drain on public finances.
“But there are major doubts that Africa’s most populous country is finally ready to wean itself off a system that has helped some in high places syphon billions from government coffers.”
https://today.rtl.lu/news/business-and-tech/a/1533815.html
“Islamic militants have killed at least 20 soldiers and more than 40 civilians and injured hundreds in twin attacks in northeast Nigeria’s Borno state.”
https://www.sbs.com.au/news/twin-terror-attacks-in-nigeria-kill-at-least-60
It seems like every oil exporter has historically had a scheme of charging internal buyers of oil less than oil for export. In this way, it is collecting heavy taxes only on exported oil. This scheme no longer works, when oil prices fall too low. The oil price is already low without an additional subsidy, and the government doesn’t have the revenue to maintain the system.
Harry, I remember when Nigeria had a very lean government. Local nobles at the top, a small cadre of “overseas civil servants” under them, and some local labour. My father ran the economy of Northern Nigeria, a territory three times the size of England, with one senior clerk and two junior clerks. Of course, he didn’t: he just held the ring, and let the natural skills and ambitions of the people do the rest, which they did very well. Until “Nigerianisation”.
The problem is cultural. If you move up in the world, you must lift up your family, then your home village, and then your tribe. The result was a hopelessly top heavy administration, most of whose employees did nothing. This was exacerbated by the creation of the Abuja Capital Territory in 1991, which divorced the central government even further from reality. Just as Brasilia had done in 1987, which was the bad example they emulated.
“Oil production in Venezuela, the country with the world’s largest reserves of crude, has fallen to a 75-year low with U.S. sanctions continuing to cripple the country’s exports.
“Venezuela’s state-run oil company Petroleos de Venezuela SA lowered its production estimates to 374,000 barrels a day as of Wednesday, according to a document seen by Bloomberg, a level not seen since 1945.”
https://finance.yahoo.com/news/venezuela-oil-production-plunges-lowest-123000887.html
“Venezuelan families on the outskirts of Caracas are expanding a settlement of mud-and-bamboo homes lacking running water, power and sewer services, in another sign of declining living standards amid a six-year economic crisis.”
https://uk.reuters.com/article/uk-venezuela-poverty/mud-hut-homes-near-venezuelas-capital-signal-growing-desperation-idUKKBN23K0LK
This may be the housing standard of the future, everywhere!
You might say that Venezuela is ‘ahead of the curve’ in running short of energy, oil products and electricity. A fate we are all gong to follow soon enough.
Have you ever noticed that whenever any mainstream news source reports on Venezuelan oil output, they tend to include:
>>the country with the world’s largest reserves of crude
Which of course is propaganda nonsense. What Venezuela has lots of is co-called very heavy oil which is arguably more solid than liquid and very expensive to extract, it is very viscous. With low oil prices, this heavy oil ‘should’ stay in the ground.
What Venezuela does not have much of left is regular, good old fashioned, easy-to-extract liquid crude.
“The economic misery enveloping the world, deepened by the crash in oil prices, has sharpened a split within the United States ruling elite. Those who support and fund President Donald Trump are aligned with domestic US energy companies that suddenly face a great risk from plummeting oil and gas demand.”
https://www.aljazeera.com/indepth/opinion/oil-coronavirus-pandemic-complexities-geopolitics-200610084759897.html
“Facing severe budgetary strain due to COVID-19 and low oil prices, Saudi Arabia will likely reduce its arms purchases, while avoiding spending cuts that could impede its internal security or the development of its defense sector…
“Saudi Arabia will also continue to rely on the United States to lead the deterrence to major external threats in the region, such as Iran.”
https://www.businessinsider.com/covid19-oil-price-fall-force-saudi-arabia-revise-military-priorities-2020-6?r=US&IR=T
I find the split growing increasingly wide myself. The Liberals see their case as overwhelming the “correct” one; the Liberals have the smooth leaders, the university faculty, and the liberal religions to back them up. They cannot imagine that the quantity of energy will make any difference. The Conservatives depend on Donald Trump and his changing staff. They are backed by the conservative religions (Bible is literally true group).
This might be relevant:
Summary: “Scientists have found that when just 10 percent of the population holds an unshakable belief, their belief will always be adopted by the majority of the society. The scientists used computational and analytical methods to discover the tipping point where a minority belief becomes the majority opinion.”
https://www.sciencedaily.com/releases/2011/07/110725190044.htm#:~:text=Summary%3A,belief%20becomes%20the%20majority%20opinion.
If 10% of your neighborhood decided to burn it down, this might imply it is a good time to move quickly. It would seem not unlike the behavior of a school of fish, a flock of birds, a herd of animals, safety in numbers. Watch schools of fish, and they change directions rapidly, it may be the same with social trends.
If anecdotal evidence has any value, it does not work well for lemmings.
An opportunist might want to discover where trades are going on a given day, are they 10% and if so front run them. There is always something positive if one looks long enough.
Dennis L.
“…oil prices aren’t recovering as the bulls had hoped… consumption hasn’t picked up quite as much as they hoped it would by now…
“Around the world, it’s become clear that getting back to work and play will be halting.” [Boggles my mind that anyone could have thought otherwise!]
https://www.bloomberg.com/opinion/articles/2020-06-14/coronavirus-oil-demand-is-a-long-way-from-recovery
“US shale producers are facing a very uphill battle, and explorers have decided to continue reducing drilling activities in the biggest shale patch in the world.
“The Permian Basin of West Texas and New Mexico was the subject of a reduction in active drilling rigs, which decreased by another 4 more rigs to only 137 remaining – the lowest since 2016, according to data compiled by Baker Hughes.”
https://thedeepdive.ca/us-shale-drilling-at-lowest-output-since-2016-amid-decline-in-crude-oil-demand/
“The Cowboy State is struggling. Low demand for oil, gas, and coal is crippling the local economy, and lawmakers are scrambling for solutions.”
https://oilprice.com/Energy/Energy-General/The-Cowboy-State-Is-Hurting-As-Low-Oil-Prices-Persist.html
“As New Mexico’s oil and gas industry struggles with lower prices and slowing production brought on by the coronavirus pandemic, some members of Congress and state officials are urging the U.S. Interior Department to allow operators to temporarily plugs wells until prices stabilize.”
https://www.thehour.com/news/article/New-Mexico-delegates-officials-press-for-15338021.php
I am not sure that temporarily plugging wells can lead to as much production after unplugging.
Also, I didn’t realize that the US Interior Department had to allow operators to temporarily plug wells. Perhaps it is a money issue; operators need Federal Funds to afford to plug the wells.
Here come the bankruptcies…
Extraction Oil & Gas Files for Bankruptcy Amid Commodity Slump
https://assets.bwbx.io/images/users/iqjWHBFdfxIU/iToLiZinQlHo/v2/1400x-1.jpg
“Extraction Oil & Gas Inc. filed for bankruptcy, becoming the latest producer to succumb to high debt and dwindling liquidity amid a difficult environment for energy companies.
The Denver-based company filed in Delaware after skipping a May 15 interest payment on its 2024 bonds, triggering a 30-day grace period while it explored strategic options to address its roughly $1.5 billion of debt.”
PDF location https://www.researchgate.net/publication/328867249_The_rebound_effect_of_dematerialization_and_decoupling_a_case_of_energy_efficiency
to me this virus scare is a hoax , what is the motive ? an attempt at wealth redistribution to allow a transition to a new economic system that would be decoupled from economic growth . Will it work ? The key words for this new system are DEMATERIALISATION and DECOUPLING after reading the PDF the plan was to effect an income doubling for every citizen of CHINA by 2020.
https://www.dw.com/en/beijing-orders-lockdown-amid-fresh-outbreak/a-53799032
Parts of Beijing have been put under lockdown after a fresh cluster of coronavirus infections emerged at a local market.
The Whack a Mole game begins again. Finding the many cases without symptoms is a horribly expensive exercise.
sure, extreme (over)reactions in Beijing since it is the seat of the Chinese Commmunist Party…
above all, they must do anything and everything to keep themselves safe from the virus…
perhaps there is hope for the worst and a visit to Beijing by my good friend Schadenfreude…
they are putting on a show for the world because another lockdown for the world is being planned
Imagine the fear as the virus reappears in China now: you are ordered to stay at home, waiting for the testers, knowing that that if ‘positive’ you could be dragged off to one of the state plague ‘hospitals’ for the kill or cure isolation treatment…..
Then there’s the temptation to think things are sort of recovering, and we can relax now.
Yes, that too. Although psychologically it’s useful to give oneself a brief respite from anxiety if at all possible, even knowing that is all just a temporary lull. Keep your spirits up, Artleads!
As always it pays to ask not where your attentiom is being directed …that is so obvious…but from where your attention has been diverted.
Russiagate, Skri.pals, 911, Syrian gas attacks the protests (who thought Mr Floy.ds life mattered before…not even him?) and of course this nondemic.
The magicians so easily lead the awestruck plebs to tweet and twit over the urgent and now, while the important and real life-changing events are the elephant inthe room.
‘So may the outward shows be least themselves:The world is still deceived with ornament’.
The real pandemic is warming up in the wings.
The starvation problem and the vulnerabilities it causes?
The next round of COVID-19, now that we have figured out that lockdowns are too expensive to work?
A different virus?
A problem related to antibiotic resistance, perhaps with bacteria?
All of the above?
All of the old plagues replete with the horses. The newer addtion will be the plague of the righteous, whether religious elites, academic elites, political or racial progressives, geen utopians etc etc. Name your medicine.
Imagine a crowdwd airport waiting lounge, no food, no toilets, no planes coming or going. Now put half a dozen different cable TV monitors, all on different channels, all on full volume, around the room. Each will have gathered around it the dedicated foot-soldiers nodding their heads knowingly, as each ‘team’ recieve completely different narratives about who is to blame. The confused in the middle will have a jumble of competing messges, but they don’t really matter. They are merely props. No social/physical distancing possible. No reasoned debate.
A malnourished, misinformed and dependant populace on a crowded and polluted world is the perfect petri dish. Covid is just an appetiser.
Just so: Greenies, Antifas, BLM, radical Left, Neo-Marxists – all potentially very dangerous fanatics bent on stirring up trouble and eliminating or humiliating opponents.
It calls to mind Rome as it fell apart, with the fanatical Christians running around destroying the pagan temples and holy sites – which got even worse when the emperors decided to adopt Christianity and persecute pagans with full state authority.
Shades of the Chinese Cultural Revolution, too.
The pagan temples were closed by Theodosius in 392. That also closed the Serapeum, the main building housing the Library of Alexandria. More significantly, it also closed all the Empire’s hospital, which were managed by the temples, principally the Asclepeia. It would be three hundred years before a network of Christian hospitals finally replaced them.
I am on the New England Journal of Medicine Group Covid-19 Mailing List. webmaster@n.nejm.org
There are several interesting articles this week’s edition. I think this mailing list is free, but registration is necessary.
Important Lessons from Cruise Ship−Related COVID-19
An outbreak of COVID-19 on an Antarctic-bound cruise ship provides accurate and important data on the high proportion of asymptomatic infection.
Before boarding, 95 crew members and 128 passengers were screened for COVID-19 symptoms and elevated temperature. Screening continued and multiple hand hygiene stations were available onboard. From the outbreak’s start, passengers were strictly isolated in cabins.
On day 20, 128 (59%) of the 217 persons still onboard tested positive for COVID-19 by reverse transcription polymerase chain reaction, including some who had negative rapid-testing results. Of the 128, 19% had any COVID-19 symptoms and 81% were entirely symptom-free. [WOW!]
Convalescent Plasma for COVID-19: More Questions Than Answers
In a multicenter, open-label study in patients with severe or life-threatening Covid-19, reported in JAMA, convalescent plasma did not provide added clinical benefit to standard treatment. [The plasma was supposed to have antibodies in it; it didn’t seem to work. The study was a very early one in Wuhan, however.]
Natural History of Asymptomatic SARS-CoV-2 Infection
Follows 90 people from the Diamond Princess who tested positive for COVID-19, but never developed symptoms.
Very important, thank you Gail. Time to sign up to the Journal.
You have really got to ask how accurate the tests actually are, I suspect not very.
There was another article I saw, but I somehow lost track of. It was on precisely the problem of so many false negatives when testing for COVID-19. Also, the problem of false positives when testing for antibodies. It was questioning how worthwhile trying to do a large number of tests really is.
PCR is accurate, with the right test.
But that just tells you if you are currently infected, and even partial antibodies show up.
There are various companies making PCR tests, with varying standards.
Polymerase chain reaction tests the antibody rather than the immune response.
So like everything else in life, if you have won the lottery in health and are not susceptible to this disease you can get some incredible travel deals. Also, you will be very valuable as an employee. No sarcasm, observation.
” A study published in the Journal of Virology suggested that individual genetic variation could explain the differences in immune responses to severe acute respiratory syndrome coronavirus 2 (SARS-CoV-2), the virus that causes coronavirus disease 2019 (COVID-19).”
https://www.drugtopics.com/latest/genetic-variability-immune-system-may-affect-susceptibility-covid-19
As in everything, chose your parents wisely and it will be difficult to lose in life.
Dennis L.
Another solid article by Charles Hugh Smith: “Our Wile E. Coyote Economy: Nothing But Financial Engineering”
http://charleshughsmith.blogspot.com/2020/06/our-wile-e-coyote-economy-nothing-but.html
Stock markets give an illusion of added value of companies that is not really there. Smith give the example of Apple. Its profits have not been rising, yet its stock market price keeps rising, due to what he calls “financial engineering.” This includes added debt in addition to lower interest rates.
Competition!
The Most Ridiculous Pandemic-related Headline.
How about this?
‘Sanchez (Spanish Leader) discusses vaccines with Miley Cyrus on Twitter’
“Thousands of [US] hotels facing their worst year on record during the COVID-19 pandemic may have to close for good if they can’t get debt repayment deals, but the few firms that would be able to help are already overwhelmed with requests for aid…
“Fully 83% of hotel debt borrowers have asked their lenders for debt forbearance or payment deferral on loans, many of which are tied up in commercial mortgage-backed security pools, the trade group said. Only a slim 15% of hotel debt borrowers in CMBS pools have received forbearance, according to the American Hotel and Lodging Association.”
https://www.law360.com/banking/articles/1280023/hotels-in-pandemic-freefall-struggle-to-avoid-default
“Because of COVID-19, hotels across the US are on track to lose more than $500 million in room revenue per day.
“In the UK, a total of at least 1 million jobs are at risk, according to the UK Hospitality Association.”
https://www.hospitalitynet.org/opinion/4099160.html
“More than 200 companies have filed for bankruptcy in relation to the coronavirus crisis in Japan, leading to thousands of job losses, according to the latest count by a credit reporting agency…
“…hotel bankruptcies stood out as an early trend because of the huge drop in foreign visitors.”
http://www.asahi.com/ajw/articles/13429744
Economic ruin everywhere due to lockdowns.
Still the lockdowns couldn’t bring down the world Covid-19 curve, only flatten it for a while.
The curve is now rising again as everyone is coming out from the lockdowns.
https://pbs.twimg.com/media/EaJ3bHnUEAYXwMy?format=png&name=small
Not surprising! If hotels close, I wonder where the workers will find jobs. I also wonder what the selling price of hotels will be.
A hotel on Boardwalk is $1000 I believe.
Interesting details on the terribly extended lag between revenue recovery and regaining the old level of profits in the hotel trade: fr instance, no less than 13 years after 9/11 for UK hotels!
“Because of COVID-19, hotels across the US are on track to lose more than $500 million in room revenue per day.”
Because of COVID-19, people across the US are on track to save more than $500 million on hotel room costs per day…
“While [China’s] domestic flights have rebounded, the busy concourses don’t extend to the international terminals. And that portends a long and slow recovery for airlines, the refiners who produce jet fuel and, in turn, oil prices.”
https://uk.finance.yahoo.com/news/china-patchy-air-travel-recovery-210000291.html
“Thousands of Hongkongers have sung a popular protest anthem and chanted slogans across the city as they marked the first anniversary of major clashes between police and pro-democracy demonstrators.
“Riot police declared Friday’s gatherings unlawful assemblies and a breach of anti-coronavirus bans on public meetings of large groups, sending snatch squads to make multiple arrests throughout the evening.”
https://www.theguardian.com/world/2020/jun/13/hong-kong-protests-arrests-as-thousands-sing-protest-anthem-on-anniversary-of-clashes
“In one of the world’s biggest diamond vaults, hidden inside a nondescript office compound on the dusty outskirts of Botswana’s capital, the precious stones just keep piling up…
“Now, as the coronavirus restrictions that froze the global industry for months begin to lift, the unsold diamonds present a dilemma: How to reduce billions of dollars’ worth of stocks without undermining the nascent recovery?”
https://businessmirror.com.ph/2020/06/13/the-great-diamond-glut-miners-stuck-with-gems-worth-billions/
“The pandemic hit the aluminum market hard by triggering a downturn in the auto and aerospace industries, two big buyers of the metal. A surfeit of metal pushed benchmark aluminum prices down 12% this year, to $1,582 a metric ton on the London Metal Exchange.
“It also revived interest in hoarding aluminum to sell at a later date, a trade that became controversial after the 2008-09 financial crisis.
““This is a really telling signal that we’re in a really massive surplus,” said Oliver Nugent, a commodities strategist at Citigroup Inc. “There’s money on the table because the market is paying people to clear markets of this glut.””
https://www.wsj.com/articles/aluminum-glut-revives-financial-crisis-era-storage-trade-11591952519
Not enough demand for aluminum or diamonds! Low prices and gluts of many commodities.
choice is simple
eat the diamonds, or sell them off cheap
something is only worth what someone will pay for it
What I find interesting is that like all carbon, diamonds burn.