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History back to 1820 gives hints regarding what may follow
With the recent closure of the Strait of Hormuz, many expect oil prices to spike and stay high. Instead, they have barely budged. The latest spike in prices is a mini spike. If these oil prices were adjusted for inflation, the spikes in the past would appear even higher.
This is not a new problem. Looking at energy data going back to 1820, low demand (affordability) has repeatedly produced financial crashes, wars, and collapses. We appear to be entering another such period.
In this post, I examine differences in how the economy behaves, comparing two different types of periods: those with low energy affordability (“low demand”) and those with high energy affordably (“high demand”). I also offer my view on what this analysis suggests may be ahead for the world economy.
[1] How high demand differs from low demand
High demand looks like a situation in which, each year, an increasing number of people can afford cars and the fuel that they require. With high demand, the number of new cars sold each year tends to rise. Young people are eager to buy homes because they find homes affordable. They find their incomes relatively higher than their parents’ were at their age. Countries around the world find it easy to industrialize. This allows their citizens to have better lifestyles. As we will see later in this post, the periods of the 1950s, 1960s, and 1970s were periods of high growth in demand for oil products.
What we have now is the opposite: too many young people who cannot find jobs that pay well, even with advanced degrees. They cannot afford to go on a vacation or buy a new car. Record numbers live with their parents after they finish their schooling. They spend their spare time playing video games, rather than socializing with their friends.
The number of cars sold worldwide hit a peak in 2017, indicating indirectly that people are getting poorer. If people are not buying as many cars, demand for oil tends to fall, especially if more of the cars that are sold are electric.
Building new homes also takes oil. According to the US Census Bureau, the number of US new homes sold in the US hit a record of 1,283,000 in 2005. In 2025, the number of US new homes sold amounted to only 678,000, or about 53% of the peak amount. The huge drop in new home construction is a sign that people, quite often young people, are not as well off financially as they were years ago. They cannot afford to buy a new (or even a used) home anymore.
One study based on income tax data revealed that between 1948 and 1970, US incomes tended to rise faster than inflation. Between 1968 and 1983, the incomes of both the top 10% and the lower 90% rose as fast as inflation. However, between 1983 and 2012, the top 10% received far greater increases than the bottom 90% (Figure 2).
If workers in the bottom 90% of the distribution are not doing well, it is difficult to keep prices of commodities as high as those producing the commodities would prefer. Purchases of commodities, including food, and fuel for vehicles, do not rise proportionately with huge incomes. Elon Musk and other very high-income individuals do not spend all day eating or driving their vehicles. The bottom 90% must prosper for demand (affordability) of oil and other commodities to stay high.
[2] What experience with high and low growth in energy supplies since 1820 teaches us.
Several years ago, I prepared an analysis of how the world economy behaved over the long term, over the period from 1820 to 2017. I have recently updated this study. I found that the economy behaved quite well in times of high energy consumption growth. In times of low energy consumption growth, there seemed to be many adverse events, such as financial crashes, wars, and government collapses.
I am afraid that with today’s oil and debt problems, we are headed into a pattern of low energy consumption growth, or even energy consumption contraction. If this is the case, we should expect outcomes at least as undesirable those experienced during past periods of low energy consumption growth in the past.
(a) Methodology
I first prepared a new data set by combining two data sets, the earlier of which was available only every 10 years, with more recent data available more frequently. The energy quantities reported were rising rapidly. To analyze how fast they were rising, I first computed the average annual increase percentage for each 10-year period, as shown on Figure 3.
For example, the period from 1961 to 1970 (shown as the 1970 bar) had a very high annual rate of growth rate for energy consumption. This was the period when many of the interstate highways in the US were opened and many pipelines were added.
On Figure 4, I divided the bars shown on Figure 3 into two parts.
On Figure 5, the blue portions of the bars represent the average annual increase in population over the 10-year period. The red portion of the bar is computed by subtraction from the total. It is the amount that seems to be left over for a rising standard of living. Having a tall red portion of the bar would be very good; having little or no red bar left would represent a problem. Note that in two periods (the one ended 1860 and the one ended 2000), the amount left over for an increase in living standards was negative.
(b) Good things happened in years with very high growth in “Living Standards”
Figure 5 shows the information on Figure 4 as an area chart.
While I don’t show oil prices on Figure 5, those who are familiar with oil prices will remember that high oil prices were a feature of the 1973 to 1981 period. Also, as China began its growth period, another spike in oil prices took place. High growth in energy supplies and high oil prices seem to go together. High demand from a growing economy tends to hold prices up.
The label “China” refers to the rapid growth that took place in the decade after China joined the World Trade Organization in 2001. This was mostly powered by China’s huge growth in coal supply between 2002 and 2011 (Figure 6).
China and the world experienced another spurt of increased coal production starting in 2022, when coal prices temporarily spiked to a high level, perhaps indirectly related to the conflict in Ukraine. But coal prices have gradually come back down, resulting in flat world growth in coal production since 2023, and a plateau in China’s coal production growth.
(c) Troubled Periods took place when the growth in “Living Standards” was low or negative
Figure 7 labels three periods with very severe dips in “Living Standards.”
The First Troubled Period started with the Panic of 1857, which some consider to be a cause of the US Civil War. According to this view, the collapse was related to an over-expansion of the US economy, followed by the collapse of the debt bubble that had allowed this expansion to occur. Financial problems affected both the North and the South.
As I see the situation, one part of this financial problem was the declining profitability of slave labor. In the US South, the labor of slaves was the main source of energy used to operate plantations. An underlying issue was that the soil had gradually become depleted because of many years of growing of cotton and tobacco. These slaves had been purchased with debt; this debt could not be repaid with interest unless the income of the plantations was sufficiently high. However, poor harvests were not offset by sufficiently higher prices, which led to financial problems for plantation owners.
There may also have been an issue that the population, in general, was becoming poorer, essentially because of overpopulation. I say this because studies show that the height of army recruits had fallen, suggesting poorer nutrition. Sanitation had recently been improved, allowing a larger share of babies to survive to maturity. At the same time, immigration into the US continued. With overpopulation, it was difficult to keep incomes up. If farms were divided among many sons, farm sizes would tend to become smaller, leading to lower farm incomes. There would also be greater competition for factory jobs, tending to hold wages down.
Of course, when the Confederacy lost the war, the Confederate Dollar became worthless. For some, this added another financial crisis.
The Second Troubled Period was 1920 to 1940. This is a notoriously bad period, with the Great Depression and World War II included. Arguably, World War I should also be included. Commodity prices of all kinds fell very low. Tariffs were added in the 1920s. The problems seem to have arisen at the time Peak Coal hit–prices could not rise high enough to cover the cost of extracting coal from narrower and deeper seams. In my view, World War I began at the time of Peak Coal in the UK, and World War II took place at the time of Peak Hard Coal in Germany.
With depletion, the cost of extracting coal kept rising, but the sales price of coal would not rise to compensate for the higher extraction costs. Instead, wages of miners were increasingly squeezed. Strikes and lockouts became common. Taking a job as a soldier seemed like a reasonable alternative.
There were many events from this period that most people would like to forget, including the currency hyperinflation of the Weimar Republic between 1921 and 1923 and the Holocaust from 1933 and 1945. Country lines were redrawn. Some countries disappeared, and new ones were added. Those holding currencies of countries that disappeared were likely left without funds.
The Third Troubled Period was 1990 to 2000.
A major event of the Third Troubled Period was the collapse of the central government of the Soviet Union, leaving the 15 republics as independent states. The collapse also indirectly affected Cuba, North Korea, and some countries in Eastern Europe that were not part of the 15 independent states. With this change, the demand for fuel of all kinds fell in the countries affected. Factories were closed in many areas, including Ukraine, which was part of the Soviet Union.
The pullback in demand from the collapse of the Soviet Union helped hold oil prices down in the 1991 to 2001 period. Oil prices had previously been brought down by the spike in interest rates in the 1980-1981 period. In my opinion, these low oil prices played a major part in the collapse of the Soviet Union. The Soviet Union, as an oil exporter, needed higher oil prices to invest in developing new fields. In my opinion, the impact of the collapse of the government of the Soviet Union kept world demand (and oil prices) low during the 1991 to 2000 period.
The collapse of the Japanese real estate bubble also took place in this period, as did the 1997 Asian Financial Crisis. Low growth in the world economy, indirectly related to the collapse of the Soviet Union, may have played a role in these financial events.
[3] The world’s self-organizing and self-healing economy
From a physics perspective, all economies are dissipative structures. Other examples of dissipative structures include ecosystems in general, all plants and animals, including humans, and hurricanes. One characteristic of dissipative structures is that, at some point in their lives, they tend to grow. Another is that if there is an injury, within a range, the systems tend to be self-healing. For example, a cut on a person’s arm will tend to heal; a hurricane going over land will temporarily lose much of its force, but it may increase in force again if it returns over warm water.
Another characteristic of dissipative structures is that they are dependent on having a sufficient energy supply of the right kinds to continue their existence. For humans, the energy supply is food; for an economy, it is a combination of many kinds of energy needed to match the built infrastructure of the economy.
All dissipative structures have finite lifetimes. Ecosystems often come to an end through fires. Humans generally do not live more than 80 or 100 years. Economies also tend to come to an end, either by losing a war or by the collapse of a central government, related to debt problems. The collapse of the Soviet Union involved a debt problem, among other issues. Figure 9 shows the huge drop in demand for energy of all types as its central government collapsed.
There is more stability of dissipative structures than a person might expect. Economists talk about an Invisible Hand being involved. Researchers examining dissipative structures talk about them being “self-organizing.” For example, if a fire or a change in climate causes a forest to collapse, it does not take many years for the forest to refill with suitable plants and animals for the somewhat changed situation. If a business or government fails, new, somewhat different businesses or governments are likely to take their place.
I would argue that if the Universe is constantly expanding (so it is an “open system,” rather than a “closed system”), what appear to be self-organizing systems may, in fact, be God-organized systems. In other words, instead of creation being a one-time event in the distant past, some type of literal higher power may be involved in a way that makes creation more or less an ongoing event. A person might wonder with the strange confluence of recent events, including the strange weather patterns associated with El Nino, whether today’s humans are being warned that a major change in economies will take place soon.
[4] What kinds of things may happen in the near future?
(a) Current disturbances in the Middle East and elsewhere are raising long-distance shipping costs for both food and oil. (See this video.) Normally, the price of food and oil must be high enough to satisfy producers and at the same time be low enough to satisfy customers. But now a new layer of costs has been added: the cost of shipping longer routes.
I would argue that because of the problem with low demand (affordability) by consumers, shipping costs must be paid almost entirely through a reduced net oil price available to oil producers and reduced net food prices available to farmers. The amount that consumers can afford doesn’t increase because of higher transportation costs.
(b) Furthermore, the use of extra oil for transportation of oil and food will tend to push the overall economy toward contraction because there will be less oil available for other uses, such as to power agricultural machinery and jet airplanes. If the overall economy begins to contract, we can expect dips in oil prices similar to those in 2008 and 2020 (Figure 1). But if recession persists, low oil prices will not reverse themselves as quickly as they did earlier.
(c) I expect home and farm prices will tend to fall around the world. This is related to the low level of demand (affordability problem) in the US and elsewhere. Figure 11, showing median US asking prices for homes, suggests that home prices have been barely holding their own for quite a while. A decrease would not be surprising with all the pressure the economy is now encountering.
Farm prices are likely to be under pressure as well, because of the difficulty farmers are having obtaining adequate income from their farms. If farm and home prices fall, there is a substantial chance that the debt bubble holding up these prices will collapse.
(d) There are many other debt bubbles that seem to be waiting to collapse. Some of the debt relating to AI seems to be in a bubble. There is considerable commercial real estate whose value seems to be being held up by “extend and pretend” loans. Collapsing debt bubbles tend to lead to collapsing banks. They also tend to lead to banks less willing to make new loans. Layoffs seem likely. All these things point to a major recession ahead, with less buying power for the population.
(f) Collapses of some top levels of government, similar to the collapse of the central government of the Soviet Union, may be ahead. Such collapses can greatly reduce world energy consumption, including oil, with relatively little violence.
[5] How the nature of the economy may help over the long term
As noted previously, economies seem to have self-healing properties. Troubled periods can last for many years, but there seems to be a substantial chance that a way out will eventually be found.
If a government fails because of excessive debt, a new government (or governments) is likely to take its place. The new government will likely have fewer employees and offer fewer services to citizens. Pensions will likely need to be reduced or eliminated completely.
Even if governments fail, or national boundaries are redrawn, I expect that some businesses will continue operations. Such a situation will take place even if a new currency needs to be created to make this happen. Even in a troubled period, new businesses will start operations. Some of these businesses will make use of recycled materials available from failing businesses.
According to the Maximum Power Principle, if there are resources available that can easily be used, somehow, some organization will develop a way to use them. Over the long term, the economy will likely re-organize itself in a way that is more complex and more sparing in energy use. If energy use is efficient enough, it seems likely that a higher price for that energy supply could be made affordable to consumers. But, such a transition may take many years, if it is possible at all.
¿ Cómo va la productividad del Pérmico?
https://rayonegro.substack.com/p/como-va-la-productividad-del-permico?utm_source=post-email-title&publication_id=6627814&post_id=214564387&utm_campaign=email-post-title&isFreemail=true&r=216vfx&triedRedirect=true&utm_medium=email
So what happened last week?
Iran has reportedly modified its state of the art Qassam Bassir to create a anti ship variant.
The base missile has
Speed less than mach 12
Electro optical terminal guidance
EW capabilities
Final approach maneuvering
The anti ship missile variant has reportedly added thermal targeting. The sea provides a uniform thermal surface and vessels thermal properties contrast with it creating robust target identification.
This missile is not a joke.
Iran fired one at the US navy carrier group. This is the first time for this variant. Early in the war one of the base missiles was probably fired at a Carrier group.
Near miss?
Demonstration?
Unknown
.
USN responded by destroying three Iranian tankers. Irans targeting of vessels was not comparable. Light UAV strikes as is standard for Iran generally when attacking commercial vessels.
IMO the USN response demonstrates the seriousness of this situation.
US will inflict damage on Iran if they hit a vessel with this missile.
Is a nuclear deterent truly a deterent when applied to a nation that has historical pride in martyrdom?
What is the the level of nuclear destruction that will solve this problem?
How will use of a nuclear weapon for the first time since world war 2 effect humanity?
https://youtube.com/shorts/nuXbvmJ_lSo?si=svKq6Jw66RbqaC5s
Apparently they had some sort of [ electro optical terminal / thermal guidance ] even on previous revisions of this and other weapon systems. While the W. msm was going over the top how all Iranian radars have been destroyed, so they supposedly lost the war.. well nowadays radars are not needed (that much).
I suspect that Iran was demonstrating what it can do.
‘You don’t have escalation dominance because we could sink your warships and kill those troops. They are legitimate targets. That would work out really badly for you in the polls. True you could respond and kill some of us, but you have done that anyway. That is not nice but we can cope with that. Are we even bothered? It just makes you look bad. Can you cope with major losses if your warships go down?’
The USA then demonstrated its ruthlessness.
‘Hey those tankers are civilians and not really legitimate targets, so you use drones. The deterrent is effective but civilians are not killed. We are the USA, and we really don’t care. We will use serious missiles on tankers and if some civilians get killed then too bad for them.’
The USA is trying to trump capabilities with ruthlessness, but it doesn’t really change the equation that Iran could sink warships and likely trash Trump in the polls.
USA cannot go nuclear because it would completely trash the diplomatic standing of the USA throughout the world. USA would have used a nuke in an illegal, unnecessary and unprovoked war against a non-nuclear state. His presidency would be over along with the USA on the world stage. The USA would face total isolation.
For now it is a stand off, and about who will buckle first given the dual ‘blockades’.
The thing is that the midterms are coming up. Trump wanted to dethrone the Iranian government, on behalf of Israel, but really it is him who is liable to lose legislative authority not them, and in no small part because of this highly unpopular, illegal, fruitless and highly disruptive war. That’s life.
So, ‘Tick, tock. Don’t get too bold Trumpy boy or some of your warships are going down, and how would that look for you just before the midterms? You mind yourself boy, and odds are that you are going down in the midterms anyway. Make that worse if you want. Think of your presidency as one of those warships – down it goes!’
The majority of Iranians are of course perfectly sane and do not share the Shia martyrdom complex, and in fact truly detest the religion professed by their rulers.
And the rulers? I am confident that they are as keen on enjoying this world as anyone else, the mullahs included.
Their view of the desirability of martyrdom might be like that of St Augustine; ‘Free me from Sin, O Lord, but not just yet!’.
In a bored moment yesterday, I asked ChatGPT who was to blame for everything. “The French”, came the unexpected reply. I asked “Why?”, and Chat listed a few of their transgressions against the English / British across the centuries, starting with 1066. I accused it of being politically incorrect, but it countered that it had recognised that my question was not serious. Hinting at its lack of consciousness, I replied, “I forgive you, for you know not what you say or do”. It continued, “So by invoking Luke 23:34, you are excusing me on the grounds of my artificial innocence. I shall savour that absolution!”
I had quite a chuckle at the “artificial innocence” bit, as opposed to the normal “artificial intelligence” . I enjoy that sort of inventive sarcasm, but I wasn’t expecting that level of sophistication from the consciousness-free ChatGPT. 🙂
I will be headed to the airport today, to return home. I may be slow to respond.
Continuing our exploration of the history and prehistory of our finite planet, going way, way, way back to when dinosaurs ruled the world (imagine the size of their rulers!); let’s look at what do we know and how do we know it, by asking a friendly AI.
AI-san, we’ve talked about how the Earth’s climate and the atmosphere was rather different when the dinosaurs were at the apex of the food chain. How was it established that the atmospheric CO2 levels and the temperature were much higher during the Jurassic and Cretaceous periods than they are in our present period?
That’s a difficult question, but a fair one! 🙂
Scientists established that atmospheric CO2 and global temperatures were significantly higher during the Jurassic and Cretaceous periods using indirect climate clues called paleoclimate proxies. Because direct records like ice cores only go back roughly 800,000 to 2.7 million years, scientists look to the chemical, biological, and geological signatures preserved in the deep rock record to measure Earth’s ancient “greenhouse” state.
Estimating Ancient Temperature
Oxygen Isotope Ratios:
This is the most reliable thermal baseline tool. Scientists analyze the shells of ancient marine organisms (like foraminifera or clams) and fossilized dinosaur teeth preserved in sediment cores. Oxygen has two primary stable isotopes: the lighter 16O and the heavier 18O). In warmer oceans, marine life incorporates a higher ratio of 16O into their calcium carbonate shells or tooth enamel. Measuring these ratios using mass spectrometers indicates that Jurassic and Cretaceous oceans were up to 8°C to 15°C warmer than today.
Biogeographical Clues:
The physical fossil record visually backs up the chemical data. Fossilized tropical plants (like relatives of the Norfolk Island pine), crocodilians, and extensive coral reefs are consistently found at high paleolatitudes near the poles. The absolute absence of polar glacial ice sheets in the Mesozoic rock layers further confirms a nearly globally uniform, hot climate.
Estimating Ancient Atmospheric CO2 Concentrations
Plant Stomata Density:
Leaves breathe in CO2 through tiny microscopic pores called stomata. When atmospheric CO2 is exceptionally high, plants naturally grow fewer stomata because they can easily gather the carbon they need. By studying incredibly well-preserved fossil leaves—particularly from ancient Ginkgo trees—and comparing their low pore density to modern leaves, scientists have proven that Mesozoic CO2 concentrations were drastically higher.
Boron Isotopes in Marine Shells:
The boron isotope composition embedded within fossilized ocean shells alters depending on the acidity (pH) of the water. Because higher concentrations of atmospheric CO2 chemically force the oceans to become more acidic, measuring boron isotopes allows scientists to reverse-engineer the atmospheric gas concentrations of the period.
Seismic Tomography and Carbon Modeling: Earth scientists use a method similar to a medical CT scan—called seismic tomography—to image tectonic plates that sank into the deep mantle millions of years ago. By calculating the volume of these ancient plates, researchers quantified the massive scale of seafloor spreading and volcanic activity (such as the eruptions that built the Deccan Traps). Plugging this data into advanced carbon-cycle models confirmed that volcanic emissions regularly sustained Jurassic CO2 levels 4 to 5 times higher than present-day levels (reaching up to 1,200–1,500+ ppm).
Siberian coast citrus plantation for the win!
But realistically as the human-oids go likely extinct and the universe happens cruising in over-all cooling down mode anyway, it likely won’t come to that near pole heat bonanza ~ever again.
US committed to selling 172M barrels out of the US SPR as part of the joint IEA 400M global release.
September we will see the end of this committment, putting us about ~9M barrles below the Congressional 252.4M mandate. (42 U.S.C. §6241(h))
The chart is still stunning sitting at levels last seen from 1982. (The reserve was created in 1975) .
Quo Vadis ? After me the deluge .
https://x.com/chigrl/status/2096656094588449088/photo/1
US shale is running out of Tier 1 drilling locations…
The only major US production growth story of the last decade is peaking.
When US conventional oil production hit its geological limits around 1970:
US production peaked and declined for decades….
Despite oil surging 30x, production never regained its 1970 peak.
Now shale is running into the same fundamental constraint: the best rock is finite.
Geology > oil prices.
https://x.com/ekwufinance/status/2096630531932704924/photo/1
Art replies:
https://x.com/aeberman12/status/2096752924403568831?ref_src=twsrc%5Egoogle%7Ctwcamp%5Eserp%7Ctwgr%5Etweet
This is actually a more adequate chart.
It shows Tight Oil production till now (what we generally call ‘US Shale Oil from hydraulic fracking’) which seems flat.
https://www.eia.gov/outlooks/steo/data/browser/#/?v=33&f=M&s=0&start=200811&end=202712&linechart=TOPRL48&maptype=0&ctype=linechart&id=
The chart is frightening. What happens next?
Diesel currently in Florida is around $6 a gallon.
Fixed the typo
US committed to selling 172M barrels out of the US SPR as part of the joint IEA D00M global release.
AfD is the far right party in. German. Exit polls in Germany:
https://www.eugyppius.com/p/sachsen-anhalt-results-post-exit
SACHSEN-ANHALT RESULTS POST: Exit polls have AfD just short of absolute Landtag majority
In the first (ZDF) version, AfD would be one seat short of an absolute majority. CDU, SPD, Greens and Linke would be able to outvote them, 42 to 41. In the second (ARD) version, the AfD would be three seats short, because the Bündnis Sahra Wagenknecht (BSW) is scraping past 5% in this scenario. CDU, SPD, Greens and Linke would have the same share of Landtag seats as the AfD, namely 39.
Far right is a vast exaggeration. how about sticklers for thee voters’ and the nation’s interest?
Yes, there are several YT vids about their rallys in recent days ( AFD or BSW ) on avg mostly normal ” little people ” no extremes.. if anything perhaps more to the naive attitude ( as this could be ever repaired again ) ..
Germany endures a lil economic hardship.
Look who’s back baby!
The group seems to have some good ideas.
Make Germany Great Again!
Wasn’t that tried already?
They’re going to send you back from Russia in a carboard box!
The rise of far right parties is a major concern for western European states, and their growth is seen as part of Russia’s ‘hybrid war’ against European NATO powers.
‘What could possibly go wrong?’
Germany aims to become the strongest military power in Europe by far, now spending more on the military than Britain and France combined, because of Russia – and now the AFD, expected to take over 40% of the vote in elections in an eastern region today, sees Germany’s interests as lying with Russia. Obviously a pact between Russia and Germany could never happen.
That is thing about popular democracy, regime change can potentially be just an election away. What happens then?
No one really knows who the future leaders of USA, China, Russia or Germany will be in 10 years time let alone 20, and what they will want, because no one really has a crystal ball.
Three of the basic principles of Realism:
1) You don’t really know what other states will do in the future.
2) ‘Defensive’ military capacity is potentially ‘offensive’ military capacity.
3) If you ‘call 911’ about the aggression of another state, then there is no one ‘at the other end to take your call and act on it.’
So you had better be careful about future outcomes, maybe build alliances like NATO, and take measures now. But there is no guarantee that things will work out for you.
https://edition.cnn.com/2026/09/05/europe/germany-state-election-afd-trump-russia-intl
… For supposedly a state-level election, Russia has been a feature.
“We’re quite transparent about saying that we want an especially good relationship with Russia, of course, but also with the United States of America, because those are simply important players in this world,” said Ulrich Siegmund, the AfD candidate for the premiership in Saxony-Anhalt, who would lead the state in the event that his party gets an outright majority of votes on Sunday.
“We see American interests, we see Russian interests, but we have our own interest, namely the German interest,” Siegmund told CNN in an August interview.
The AfD’s support of Russia is no secret – the party is against further aid and defense packages for Ukraine, often referring to defense funding for Kyiv as money that is not being spent on programs for German people.
Key party officials have also made frequent trips to Moscow, St. Petersberg and the occupied Crimean peninsula – something that has raised alarm bells among corruption watchdogs.
The AfD has also vowed to bring back the cheap Russian gas that once fueled Germany but has been phased out following Russia’s full-scale invasion of Ukraine.
But for eastern states, like Saxony-Anhalt, which were once under the purview of the Soviet Union, Möller said “it runs deeper than the cost of energy. There is a long tradition of working with Russia in Germany.”
I hadn’t anticipated this:
“We’re quite transparent about saying that we want an especially good relationship with Russia.”
This could help settle things down a bit. Or at least change the dynamics.
The stallion already left the stable.
RU won’t ever trust Euros again ( or for very long time ). Even if AFD/BSW/.. take over, they would re-start only say ~1/3rd of former west-bound energy exports capacity as all has been sold to Asia in long term contracts. Especially as they were in weaker negoc position to their trading partners around the yr ~2022.. hence selling more volume for les$..
Certainly, a lot has already been sold to China and others by long term contract, leaving not very much for Europeans.
And was this not, perhaps one of the aims behind the aggressive war against Russia in the Ukraine, with the EU as a compliant proxy – voluntarily locked out of essential fossil fuel supplies?
Or just passively watching its supply lines blow up.
As well as wrecking any possibility of a peaceful, and logical, European-Russian alliance, freezing out the US?
Do I hear chickens coming home to roost all over Europe?
Or are they vultures and carrion crows?
The leader of the German “far right” a prominent lesbian in a long term committed relationship. This gal has super sharp verbal skills and has been tearing the German Brussels politicians new assholes in debates. She grows increasingly more popular in Germany much to Brussels concern.
If you want the issues buried and are not willing to discuss you call it far right
Germany is waking up that economy can not be legislated. Half still believes in the Brussels pixi dust.
https://www.csmonitor.com/World/Europe/2026/0704/Alternative-for-Germany-convention-protests
Without Silesia, trashed by Polish monkeys, Germany can never rise up
Is her sexual orientation or her significant-other relationship status germane to the political issues at play here?
Yes Tim I agree with you. Sexual orientation should not have bearing on status. The reason why I think it has bearing is the practice of calling or defining something as far right to end people’ trying to find solutions or end injustice. Sexual orientation should not have bearing on status but name calling should not either.
The “far right” name calling is generally associated with intolerance for sexual orientation. This woman’s sexual orientation reveals the hypocrisy of the name calling thats not a revelation at all. Because the name calling like all name calling is not a genuine communication. It is the anti thesis to genuine tolerance and communication that allows cooperation . It is a demand to invoke emotion to disenfranchise opponents. Name calling destroys trust and trust is necessary for cooperation. It is a secondary characteristic of the uniparty which must above all things not agree and cooperate. If we were to cooperate we would be united and find agreement. That’s nationalistic and fascist right? There must be a repugnant enemy not a neighbor because that allows exceptionalism. Exceptionalism and divisiveness being the primary characteristics of the uniparty. Name calling is the primary method to eliminate critical thinking and enforce gang psychology. Life becomes choosing your gang not the freedom and growth of evaluating what you actually think and believe.
This “far right” designation is ridiculous. A party that wants to inject some common sense into the Left wing governance…
Wolf says a 5% 10 year won’t be a problem . I totally disagree . We have had 25 years of suppressed interest rates after the dotcom bust in 2000 . In 2000 the US debt was $ 5.67 Trillion and today $ 40 Trillion . Read the comments .
https://wolfstreet.com/2026/09/05/the-10-year-treasury-yield-over-5-my-thoughts/
The [ /b ] side to the above story is that while the debt grew, the investor class made fabulous gains in RE, tech stocks, .. almost or in some instance by even greater multiplication factor. Hence they are not in position/need to rock the boat for now.
Yes, ~small time investors and lesser countries holding US debt see it differently ( been robbed of value ) but their voice counts for less at the moment..
Interesting points. Now, much more wage and wealth disparity.
I agree really comparisons to past eras are not applicable. Yes interest on debt is a issue of course but following George Gammons ideas I think Hyperscalers able to borrow at reasonable rates is a more immediate issue.
Like a lot of things time scale is really the question. There are a lot of things that can break not just one and your balancing. The ledge your balancing on gets thinner and thinner.
IMO higher rates are inevitable and they will cause problems. Exactly what will break and at what rate is unknown. Success in intervention is measured in time IMO.
I think higher rates are inevitable because I think inflation stays high even as we hit the wall. I could be wrong. I think this is the era where supply of physical commodities is a greater factor than monetary policy or demand. This of course would be a big change.
Is 5 percent going to break things? IMO no. It doesn’t matter IMO because we are going to find out. The better question is will 6 percent break things IMO. IMO it’s only a matter of time. Intervention success is measured in it taking more time to get there.
If George Gammon is correct the most immediate problem with higher rates is Hyperscalers being unable to afford to borrow. If they stop spending the USA economy will not continue at this level. Nor nations like Korea. If they continue spending if rates are higher they must either issue more shares popping the asset bubble or profit decreases also popping the asset bubble (gammon). This is one of the balancing acts and it appears the most immediate.
From this perspective that the hyperscalers debt unaffordability breaks first not other fragile systems one can start to form the boundaries of the question whether 5 percent will do that. My guess is no. But I think we are continuing north of 5 percent.
This is my opinion. I think Gammons argument that hyperscaler debt unaffordability will break first is very reasonable .Is a dot com style bust inevitable? Of course. Is a higher ten year inevitable? Of course. Will significant things break? Of course. The question is the what is the time frame. Guessing that is very difficult. Unlike before these things will break in the era of commodity depletion and supply chain reduction or cessation.
As I mentioned my perception is the crisis will be unlike any other because abundant and affordable energy will be much smaller than previous crisis. I find that the most interesting question. What exactly are we looking at this time? I don’t think anyone knows. While curious I would be quite pleased to not find out but I think we will.
The unanswered question of WW2 remains. War was a integral part of the self healing economy but has rather dire consequences with the advent of nuclear weapons. IMO that’s really where rubber hits the road when considering interesting questions. Clash of the titans. Self healing economy vs mutually assured destruction. A lot of these failure to balance acts seem to have the potential for rather extreme outcomes.
Tim, Youtube has a series of videos about Mata the cat who lives a traditional life in Hokkaido, Japan. The visuals are stunning the subjects are soothing. It is better than real life. I would love to know your take of realism.
Link please I was touched by that story of the Japanese dog that awaited his master every day at the train station after his death.
https://www.youtube.com/watch?v=cLuXtBj94mU&t=122s
https://www.youtube.com/watch?v=EH4vpwlIsyk
finally a good use for AI
Traditional Life in Hokkaido?
This is traditional life in hokkaido, 1910
https://youtu.be/scsNnZ2G9AQ?si=TF31yGL4IMIKLGuC
That island was inhabited by a people called Ainu, whose origins nobody knows.
Their language was unlike anything like Japanese or any other people in their neighborhood and they still lived like hunter and gatherers.
Not surprisingly, the Japanese quickly seized all of their land and by 1950 there were no more native speakers of Ainu languages, everyone having to use Japanese every day to get by.
Not until their culture was sufficiently exterminated that the Japanese began to talk about them, but if you want traditional life of Hokkaido, that is the traditional life there, unlike the fictional cat who lives a fictional life in an ai created anime.`
I knew an Ainu
A long time ago
The Ainu that I knew
Lived in Hokkaido
Prior to the Meiji period, the Japanese regarded Ezo as a foreign land and the Ainu as foreigners. But from the 1700s they felt compelled to take it over in order to defend themselves from the encroaching Russians.
The Ainu also used to inhabit Tohoku, the northern third of Honshu. But over the centuries, there was a probably a fair amount of what might be called ethnic cleansing and a lot of interbreeding, with the result that the northern Japanese have a lot of Ainu blood in their veins, and to the trained eye they look physically different from the southern Japanese, who are rounder faced, rounder bodies and more Polynesian-looking—although most Japanese have a fair bit of Chinese, Korean, Mongol, and North American (Red) Indian in their makeup. So much for racial purity/
According to Wikipedia, “he Ainu are an indigenous East Eurasian people native to northern Japan (Hokkaido) and parts of eastern Russia. They are the direct descendants of the ancient Jōmon hunter-gatherers, who inhabited the Japanese archipelago for over 15,000 years.”
“Genetically, the Ainu are most closely related to the Ryukyuan people of Okinawa. Both populations carry a high percentage of ancient Jōmon DNA because they lived on the geographic extremes of Japan, meaning they did not heavily intermix with the agricultural Yamato (Yayoi) migrants who swamped mainland Japan from the Korean Peninsula starting around 300 BCE.”
Perhaps the Ainu and the Okinawans could launch a “Koreans Go Home!” movement?
That is an interesting video. Reminds a person of Koreans, perhaps North Koreans.
Thank you, Ed.
I agree with you. These videos are soothing.
They also make me want to tidy up my own place and throw lots of stuff away. The modern world is far too cluttered.
Yes, these Mata videos are realistic looking but at the same time cartoonish. There is also a bit of nostalgia on view, I’ve seen country houses in Japan where people got water from a well with a hand pump, but I have never seen the double bucket system in use.
Chainsaw maker STIHL chief calls for longer hours without extra pay
Add Euronews on Google
In an opinion piece for Euronews, Dr Nikolas Stihl, chairman of world-leading chainsaw maker STIHL, calls for reforms including a 40-hour working week without extra pay to safeguard Germany’s prosperity and welfare state.
The family entrepreneur from Waiblingen in southern Germany does not mince his words: “The German economy has been stuck in crisis mode for years. The prerequisite for overcoming the persistent weakness in growth is better framework conditions,” Stihl said.
Family businessman Stihl takes a long-term view, and for him one thing is clear: “The situation of the German economy is serious, very serious. In the past eight years we have lost around 15 percent of our industrial output. Month after month Germany is losing around 15,000 industrial jobs.”
Time for the corporate serfs to get a beating…
Yes, “the beatings will continue until morale improves”.
IBM US engineers work 60 hours per week no overtime pay. It has been this way for more than 20 years. Also no pension plan. The Germans sure do sound entitled.
My mother was a RN Nurse and had to deal with the same in that profession. Even today, nursing is still just a job in many cases and not a profession.
Nurses Are QUITTING After This Happening And It Gets Worse
I worked on several joint projects with European technicians and engineers. They considered overtime on critical projects with deadlines unthinkable. Barbaric. They do have some talented technicians and engineers for sure.
One project was outsourcing to a plant in Ireland. Ireland gave the land to my corporation and s contract that said no taxes forever to get a manufacturing plant and the jobs. So we were bringing up a prototype line with Irish techs. One confided in me they were concerned with the “strictness” . “Only two beers at lunch and no whisky”. All the Irish technicians and Engineers would take over a bar after work then return to the rental housing corporate housing provided after it closed at 2 am.and party on. They liked to sing. I was young and tried to hang a couple times but way out of my league . The rental place threatened to cease further rentals. They were not very sharp in the morning. Finally the plant manager had a meeting with all of them informing that they were expected to be on top of their game every minute they were at the plant. They complied. Good times.
The product eventually bombed. A competitor started cleaning our clocks with a much more affordable product. Then corporate decided they didn’t want to actually manufacture things just think of ideas and engineer them. They sold all manufacturing facilities and 90 percent of employees. Then of course everything moved to China anyway.
We were crazy spoiled back then. A technician only had to be a technician not programer, machinest, documentation creator , source all materials and create BOM and export documents and mandatory class 3 hazmat. We had separate engineers for mechanical pneumatic hydraulic and electrical and that’s all they had to do! Cake.
It was pretty sophisticated but nothing compared to the manufacturing machine China has become.
Whichever approach is least expensive is the one that succeeds. This happens over and over, until somehow resource start to run short for the least expensive approach.
Everywhere in the “advanced” world, we have gotten used to benefits that cannot possibly be sustained. Short work weeks. Expensive healthcare thrown in. Pension plans, starting at age 67 or earlier.
In the pre-fossil fuel age, pension plans were unknown. Health care was very limited. Work was often close to sun up to sun down.
Ah, the good old days. I remember growing up with grandfather and his coal furnace in the cellar with a workbench to repair and fix (him saying fixing”) not replace, shoes, cloths, with hoarding items that were possibly needed in the future.
Yep, got myself a paper route at age 13 to buy my first actual new bicycle and walked it on Sundays morning for the Hackensack NJ paper The Record, now defunct, but still have the patch that was given for me as a Honorary Lifetime Newspaper Boy…miss those nearly cold showers too and drafty windows in the winter…oh, those were the days
But would this greatly reduce unit costs?
I spoke to a tree surgeon recently, seeking advice on an electric chainsaw.
One point he made is that people in the industry are abandoning Stihl, as a Chinese brand offers the same quality at half the price. Spare parts readily available, lots of dealers, etc.
Times are tough, taxes up, competition increasing, and customers more penny-pinching, so Stihl becomes a luxury product from being the one they once swore by.
Interesting that Still came up. They are on my you know what list right now. I have one of their chainsaws. at the beginning of the summer it would not start. It was so hard to pull that it was near impossible. So I went on a journey to figure out the problem There is next to nothing online about Stihl on this problem Lots of YouTube videos. I took off the carb drenched the crankcase in cleaner, trying to clean any carbon deposits. After all this, I did get it to be able to pull the starter by 2 compressions. I finally got it to start. Then I made th mistake and let it run out of gas. Never started again. I found gas in the crankcase and concluded the carburetor was steaming too much gas into the crankcase, making it hard to pull. It makes sense. Gas is less compressible that air or air-gas mixture. So now I order a carb kit to replace the manifold and hope it works. But due to Stihls’ policies I can only order from Stihl 5 weeks now and I am still waiting. It has now been all summer that my chainsaw has largely not worked.
I am done with Stihl.
Note: even Stihl has been using for some of its products subcontractors..(inside EU).. the profit margin on the finalist brand was implicitly high then..
Now, the main thing, I guess it’s chiefly related to general mega-trend of transferring technology. When CHNs factories have nowadays on the floor their own CNCs and laser cutters and in-house R&D.. it’s almost over for EU/US to compete.. as almost everything could be made and further developed inside CHN.
For example, so far I’ve no incentive to abandon my Fiskars array of basic hand tools, but even these smaller precises niches will be one day swept away by CHN for good.
e.g. lets say even the Fiskars all-purpose / kitchen large scissors are so ever sharp ( ~laser cut sharpened .. metallurgic secret mojo hardened ? ) you can cut out/clean poultry(bones) with it BUT also “at the same time” trim your finger nails* on them after many y/y of abuse.. w.out additional sharpening; hence imagine lot of ( unseen ) know-how surely went into such long lasting superb product along many inner steps and stages of production..
__
* don’t necessarily try at home kids, lol..
Quality hand tools are beautiful thing.
I am afraid this story may be right:
https://www.zerohedge.com/markets/hartnett-democratic-sweep-will-trigger-stock-market-rout-and-pop-ai-bubble
Hartnett: A Democratic Sweep Will Trigger A Stock Market Rout, And Pop The AI Bubble
The biggest story last week was not the unexpectedly hot jobs report which, unfortunately, will be revised sharply lower next month as the labor market reverts to its deteriorating, AI-enhanced, trendline: Instead, what everyone was – or should have been focusing on – was the bottom falling out of the bond market with global yields jumping to the highest level in 2 decades.
. . .
the topic of soaring bond yields is also the kick-off theme of the latest weekly Flow Show (available to pro subs) from BofA’s Michael Hartnett, who writes that with a 99% probability the ECB hikes Sept 10th, 53% Fed hikes on 16th, 98% BoJ hikes 18th (per Bloomberg futures pricing), the hikes are coming fast and furious as central banks try to restore credibility to ward off surge in bond yields.
. . .
a Democrat sweep is a threat to asset prices: an electoral shift from populist capitalism to populist socialism, means the next big direction in tax & regulation is up not down (and EPS negative), and would be accompanied by policies to lower inflation, healthcare, improve affordability challenge K-shape wealth boom, AI capex boom, stocks “too big to fail” Wall Street zeitgeist.
Additionally, loss of political capital = less ability for Trump to coerce resources, corporations, foreign governments into support for policy priorities of AI war with China, resource monopolization.
Putting all this together, Hartnett says a Democrat sweep = big risk-off: it would lead to a slump in i) stocks (more than 10%), ii) the dollar, and iii) bond yields into year-end, while international stocks outperform on less trade & military wars… but Europe outperforms Asia (loses Trump AI friend); the BofA strategist says the best hedge for a Democrat sweep is short financials & US dollar. In contrast, a surprise GOP sweep (maintain House/Senate) control = big risk-on, and more importantly a green light for AI bubble and positive US dollar (“exceptionalism returns”).
Finally, the largely priced-in scenario of a “GOP Senate/ DEM House” translates into more of the same: modest risk-on… “gridlock = goldilocks”.
The economy seems to like “gridlock = goldilocks”.
Yes but it really doesn’t matter as most people on here know the end is already baked in the cake. All that we are seeing has been planned out for years. Most people on here will be dead in less than 10 years and it doesn’t look good for their children…
https://youtu.be/8tZuF8DJCxg?is=lMykKzob0lkH1T0N
Demi is going to hate me for posting this, but needs must!
It’s a doom anthem you can really tap your toes to.
Standing at the end of the horizon
Looking at another setting sun
Nature gave us all these toys to play with
But we’ve abused them, each and every one
They stretched the chord, snapped the wire
Lit the fuse but can’t retire
We’re going to the wall of fire
Tip-toeing on the great high wire
Let’s have a real fire
The city slickers built the great illusion
Now they’re the first to crumble in the sun
Now we’re going through the wall
Let’s see the flames before we fall
We’re going through the wall of fire
Let’s have a real fire
Tip-toeing on the great high wire
Through the wall of fire
We drove on many rocky roads together
Through the storms and hurricanes we rode
Unified so no one could destroy us
We stretched the bounds
But always kept the code
Liberals shout and cause concern
Forget next week while we all burn
Let’s run right through the wall of fire
Let’s have a real fire
Death-defying while the flames grow higher
Through the wall of fire
Let’s go through the wall of fire
Running through the wall of fire
Less than 10 years?
No kidding?
Stuck on my eyes!
What a surprise!
My brain hurts a lot!
That’s all we got!
As the island slowly sank
The loser finally broke the bank in the gambling room
The dealer said, “It’s too late now
You can take your money, but I don’t know how
You’ll spend it in the tomb”
The tiny man bit the soldier’s ear
As the floor caved in and the boiler in the basement blew
While she’s out on the balcony, where a stranger tells her
“My darling, je vous aime beaucoup”
She sheds a tear and then begins to pray
As the fire burns on and the smoke drifts away
From Black Diamond Bay
I was sitting home alone one night in L.A
Watching old Cronkite on the seven o’clock news
It seems there was an earthquake that
Left nothing but a Panama hat
And a pair of old Greek shoes
Didn’t seem like much was happening
So I turned it off and went to grab another beer
Seems like every time you turn around
There’s another hard-luck story that you’re going to hear
And there’s really nothing anyone can say
And I never did plan to go anyway
To Black Diamond Bay
The WSJ is reporting:
https://www.wsj.com/business/autos/carmakers-have-a-new-idea-to-boost-ev-range-add-a-gas-engine-16bbcc34
Carmakers Have a New Idea to Boost EV Range: Add a Gas Engine
Hyundai, Ford and Stellantis are planning to introduce larger EVs with gas generators to solve range anxiety
The auto industry has a new solution to Americans’ fear that electric vehicles will run out of juice: a gasoline engine.
Hyundai, Ford Motor F 1.46%increase; up pointing triangle and Jeep parent Stellantis STLA 1.28%increase; up pointing triangle are among the first U.S.-market automakers planning to roll out a new kind of plug-in vehicle called an extended-range EV. It is a fully electric car with the security blanket of a gas-powered generator to charge the battery, if needed—ensuring you won’t end up stranded as long as a gas station is nearby.
. . .
Most plug-in hybrids on the road today are essentially gasoline vehicles with a battery shoehorned in to provide a small amount of all-electric range. EREVs flip the concept. They are designed first as electric vehicles, and the engine solely acts as a generator for the battery, with no mechanical connection to the wheels.
The setup saves some battery costs compared with full EVs and eliminates the need for gas-car parts like a transmission. EREVs also drive like EVs, including instant acceleration even when the battery is drawing from the generator.
Brilliant!
Yes, that’s has been discussed already.
Chiefly aimed at larger PHEVs which will be discontinued, think
ala Jeep Cherokee TrailHawk awd – won’t get new PHEV updated generation anymore, but instead will be switched into this small onboard genset platform.
Surely at some point they will add a small sail. increases efficiency when there is a tail wind. also some pedals for when the driver feels like exercising.
Low driving speeds would do a lot more to save energy consumption than everything else they’ve been trying.
Trying to keep up the current speed of activity with “renewables” is impossible.
Without the current speed, the system falls apart. Or at least some parts of it do. They think they can pick and choose which parts will fall apart. We’ll see.
But low driving speeds fill up streets with more vehicles because it takes everyone longer to get to where they are going. Low driving speeds are not necessarily good. We tried 55mph speed limits, and they were not universally loved.
New York state has 55mph and is moving to 45mph on many roads.
The current speeds don’t help much with commutes because many roads are overcapacity at “rush hours”. The vehicle population traveling in most cities has grown much faster than the cities themselves, which results in daily gridlock and longer commutes.
Low speeds, which were last en vogue a century ago, will work in lockstep with a population of vehicles similar to what existed a century ago.
Another reason why lower speeds wouldn’t work right now is cultural. Everyone is under constant pressure from society to do more quicker and that is why I believe that low speeds , currently ,would be very unpopular.
What they’re trying to say is that they’re just going to make more hybrids but act like they’re doing something new.
“The difference here, though, is that the engine is in no way connected to the drivetrain.
It cannot directly move the car.
It only acts as an onboard generator to recharge the battery.”
But it’s still being charged with fossil fuels.
I guess charging them with solar panels is too impractical.
Nope, today’s/legacy PHEVs are more complex, especially on large 4×4/awd car models as mentioned above, that’s why they are cutting the portfolio there, huge savings. You have to keep the transmission tunnel, gearboxes etc. While with the new approach they will just put emotor on each axis, plus that small generator charging the batteries, which are now larger and in skateboard fashion not just smallish tucked inconveniently under the rear trunk.
Yes, it’s a [ hybrid ] jn general – conceptual sense again, but with completely different tech set-up from now on..
This is the future for trucking as well. Truckers can adjust the their parking position and roof PV panels angle while taking their mandatory logged rest period during the day in those bad ass little comfort cubes. A small ICE engine tops battery charge off when needed.