Tag Archives: diminishing returns

Economic contraction, coming right up

In this post, I will try to describe the physics-based limits that the economy is facing, related to diminishing returns of many kinds. The problem we are facing has sometimes been called “limits to growth,” or “overshoot and collapse.” Such changes tend to lead to a loss of “complexity.” Continue reading

Posted in Financial Implications, Introductory Post | Tagged , , , | 1,496 Comments

Where Energy Modeling Goes Wrong

There are a huge number of people doing energy modeling. In my opinion, nearly all of them are going astray in their modeling because they don’t understand how the economy really operates. The modeling that comes closest to being correct … Continue reading

Posted in Financial Implications | Tagged , , , , | 3,331 Comments

2020: The Year Things Started Going Badly Wrong

Some might describe the energy story as a “diminishing returns” story, but it’s really broader than this. It’s a story of services that we expect to continue, but which cannot continue without much more energy investment. It is also a story of the loss of “economies of scale” that at one time helped propel the economy forward. Continue reading

Posted in Financial Implications | Tagged , , , , | 2,805 Comments

The World’s Fragile Economic Condition – Part 2

The world economy can appear to be operating quite well but can be hiding a major problem that causes it to be fragile. My presentation The World’s Fragile Economic Condition (PDF) explains why we should expect financial problems if energy consumption … Continue reading

Posted in Financial Implications | Tagged , , , | 2,110 Comments

Raising Interest Rates Is Like Starting a Fission Chain Reaction

Central bankers seem to think that adjusting interest rates is a nice little tool that they can easily handle. The problem is that higher interest rates affect the economy in many ways simultaneously. The lessons that seem to have been … Continue reading

Posted in Financial Implications | Tagged , , , | 2,489 Comments