How do we deal with all of the financial distress?
Posted by Gail the Actuary on September 17, 2008 - 10:15am
The world's financial markets are in great turmoil. How do we deal with all of this? Let me tell you my view. Yours may differ.
For those of us who are peak oil aware, we know that the world is finite, so the period of continued compound growth cannot continue. Because of this, we have known that eventually we would start seeing turmoil in financial markets. It should be clear that putting our faith in these markets is crazy, even if this is what financial planners have told us to do. If we have already divorced ourselves from this faith, we are ahead of the game.
Looking at the situation from a historical perspective, we have been privileged to live in the world at a very unusual time--a time when oil was in abundance, and we were able to have conveniences that people a few generations ago wouldn't even have dreamed of. We know that this must come to an end, and that gradually we will get back to a world more like it has been over the millions of years that people have walked the earth.
What is happening now in the financial markets is only a small increment in the step-down process. We can either focus on the amazingly good fortune we have had to date, or focus how bad the change ahead might be. It seems like framing the issue as one of historical good fortune is a better approach.
How we count our wealth
We can count our wealth in many ways--the status of our health, our relationships with our family and friends, the physical provisions we have made for the future, or the size of our bank accounts.
I think our health is our most important asset. My own view is that eating the right foods and getting some exercise goes about 85% of the way toward staying healthy. I eat a huge amount of fruits and vegetables, a moderate amount of fish, a little wine, very little processed foods, not much dairy, and very little meat. This diet is hard to come by in modern-day America. With this diet, it is difficult to get heart disease and a host of other things that afflict Americans. Peak oil may actually help with our diet, if we can get enough food. It will certainly help with exercise.
Family and friends are very important as well. My upbringing was that no matter what anyone else says or does, it is always important to immediately forgive. Restraint was also considered a virtue. My parents were of Norwegian background. A favorite "Ole and Lena" joke is that Ole once said, "I love my wife so much, I almost told her so."
Co-operation is another quality that was stressed in my upbringing. I can remember a lot of "arguments" about who was should do what, but they were always of the form, "Let me do more, you are doing too much." I am fortunate that my husband follows the same philosophy. Some of this may come from belief that "Do unto others as you would them do unto you" is a good philosophy. Other religions have similar "rules".
I am fortunate that I have an extended family and quite a few friends. We don't have any "estranged" relatives. One of my sisters is gay. She and her partner are at every family function and family reunion. They stayed with my mother for an extra week after my father's death early this year. Everyone considers my sister and her partner to be a valuable part of the family.
Many of my friends are from my Lutheran church. The pastors are peak oil aware. The assistant pastor has recently started a "green team," to study issues related to resource limitations and climate change. I know the assistant pastor reads The Oil Drum at least occasionally. There are a number of people in the congregation who are interested in peak oil issues, but like other places, many who cannot mentally deal with such thoughts.
In looking at our wealth, there is admittedly a need for some real goods to meet our physical needs. I know I have been stockpiling some additional food. I bought some more last week-end. I have been keeping clothes that are no longer in fashion, figuring that they may be of use later. I am doing a small amount of gardening, but it is difficult with poor soil and much shade. Here in Atlanta, we plant fall gardens, so I got some cabbage, kale, and other vegetables to put out this past week-end.
Our bank accounts are another form of wealth. I have always been taught, "Store not up treasures on earth, but in heaven." I am not sure about the "in heaven" part, but it is easy to see why the "store not up treasures on earth part" makes sense. If we buy huge houses and large cars, they soon "own us", rather than us owning them. We need to devote our lives to maintaining all of the "stuff" that we have bought. Also, having all of this "stuff" isn't very satisfying--it is our family and friends, and what we can accomplish to help other people that is satisfying.
What's ahead
We only have a limited number of years of life ahead of us. It seems to me our focus has to be on doing the most we can with the time we have available, regardless of the turmoil in the world around us.
How is the financial turmoil affecting you? What is your view of how we should be reacting to the news? Are there financial news items other readers might be interested in? Share your thoughts.
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I've seen that expressed a dozen different ways and it never really makes sense.
The world (or oil supplies or whatever) has been finite since the beginning. It was finite 100 years ago and 50 years ago and it didn't keep compound growth from occuring... not did the depletion of whale oil (a far more "finite" resourse despite being "renewable") keep the world from shifting to other energy sources and the growth kept coming.
Great perspective, Gail, thank you.
Pos_Photo- please consider the exponential rate of depletion/extinction of the world (or oil supplies or whatever) in the last 100 years. Cheap Energy-Growth is not coming to 98% of the world, no longer on the backs of Lehman, Merrill or AIG for that matter.
phototaxi - yes oil was "finite" then too, but we were only beginning to use it and the "glass" was full with far fewer straws sucking it dry. Now the glass is half-full and there are far too many straws with hungry mouths on the other end.
The key is that in the past there were other energy sources to shift too in order to feed the continued growth.
That is not the case This TimezUp.
There are still other energy sources to shift to - wind/nuclear/solar/etc. You might argue that we won't be able to shift fast enough, but it's simply incorrect to claim that they don't exist.
Wind, nuclear and solar are the future sources of energy.
The important thing is any alternates to oil must be more affordable than what we use now, and continue to get ever more affordable, so that exponentially more is demanded - then the world's economy and population can continue growing exponentially.
At present no such alternative exists, otherwise we would be using it! - the 'technology fairy' might come to the rescue but it is unlikely to come up with a permanent viable solution.
The banking system may recover enough to fund the debt to allow the investment required to develop adequate alternatives, but again, that is unlikely since the financial system, as designed, requires growth which requires exponentially more energy. The availabilty of excess energy drives growth, not the other way around.
That's why the GOVERNMENT must step in! More government is good, level the playing field by introducing taxes on the bad energy sources, and mandating public purchases of plug-in cars. Too little government has made America the country with the highest inequality and one of the worst social mobility rankings in the developed world. The American dream is a pipedream, having a much better chance of doing good in most other developed countries. Beaming "rags to riches" stories on the airwaves is simply a way to keep Joe sixpack down.
Why would you expect the government to be any more competent than joe sixpack? The Soviet Union tried central planning and it didn't work out very well.
Local Swedish experince tells me that it ends up badly if the governemnt toys too much with socialism but can turn out well if it provides incentives for market creation. But government policies should stick to the easy long term trends and not overdo it since some of them will be wrong. Do not bet everything on one trend or problem and keep the core institutions in good shape.
How about looking at countries like the Netherlands? More government is good, a proper safety net, universal health care, higher education for both rich and poor, a government that cares about people, not just leave the country as a playing field for the big corporations and the filthy rich while tens of millions are poor and even more are struggling. Why can't America be more like the Netherlands? A compassionate country taking care of all their citizens, rich and poor, not just leave people in the gutter if you don't have money?
The case just isn't a simplistic "more government." In many respects we have too much government in some sectors--The National Security State and its Imperial Appendage eats about 1.5 Trillion dollars per year and is the best example going of Too much government (and too much power for that matter). On the other hand, we have too little government in many social areas, with the lack of a single payer health care system being the most visible and DRAINING on society monetarily. Combine just these two items, and you have well over 3 Trillion dollars in expeditures that could be used far more productively elsewhere in the socialeconomy. Unfortunately, changing the current status quo regarding just these two items is daunting because of the very deeply entrenched interests that effectively strangle the political (in the widest sense of that word) process and thus prevent ANY substantive change from occurring. IMO, Big War must be killed and its productive parts made into individual companies once again. This also holds for media consolidation; it too must cease and its holdings shattered back into the individual fragments it started as well over 100 years ago. (Yes, Media conglomeration is a problem that's been going on for that long.)
IOW, it's easy for someone with unclouded vision to see what the problems are; it's fixing them that's the challenge because they've gone unaddressed for too long, which itself is a product of too many people's vision being clouded.
Perhaps in the U.S. drinking alcohol is legal but smoking pot is not. I can distantly recall my college days. The drinkers were aggressive and selfish the pot heads laid back and generally caring of others, much friendlier too.
In the Netherlands everyone has health care its true. Its compulsory to pay for your own health care or you have to pay a fine. If your not sick for a given year you recieve a rebate from the health insurance company. Many poor people put of going to the doctor with a minor ailment so they can recieve the rebate check. Because they put off going to the doctor their minor ailment becomes a serious problem.
Comparing the United States to countries like The Netherlands or even Canada is a waste of time. Of course they have socialized programs that seem to work for all of their people. They do not have a massive sub-culture that is all consuming.
About the only slight silver lining coming from Peak oil is shared sacrifice; we will have no choice but to consume only what we produce or assist in producing. The free lunch, whether it be Social Security, Medicare, Medicaid or Welfare (individual or corporate) will be over.
Actually, I think it did reasonably ok. Russia is still a major power. The old USSR fought and won World War II. Then it had to fight the cold war against the rebuilt economies of the G7. There was no Marshall Plan for our ally after the second world war. It stood up against long odds for 80 years and was ultimately done in by several factors. Cuba is often criticized as well, yet that little government is still there after 60 years of economic warfare by the world´s biggest economies.
"The important thing is any alternates to oil must be more affordable than what we use now."
Given that we face imminent decline of our oil fed transportation system I think I dispute that statement.
In fact, we need a bridging transportation system right now EVEN IF it's more expensive.
As you say, costs will come down eventually but we have a choice between a collapse and a partialy arrested collapse followed by the later resumption of what I'd like to call "smart growth" based on natural cycles instead of the banks just pumping up the economy like an algae bloom
If nuclear is so "hot" why do we even need wind and solar? Multi MW nuclar plants are hugely more powerful and watts/unit of land far more efficient.
My local answer based on the situation in Sweden is that competition is good. If all new power is nuclear power we could end up with consumer prices that are higher then the cost for wind power. The long term marginal price is capped by the cost for those entering the market and it gets to tough to enter the market if there is no other way then investing billions in a single plant.
Having a mutlitude of alternatives to fossil power also exercises other parts of the economy making it possible to build more power producten then if nuclear power were the only option.
Renewables and nuclear have complementary strengths.
Nuclear plants are a lot better at providing base lead than load following power, and come in fairly big units which take a while to build, although lines are being set up in China and the US to mass-produce them.
So if you are in a hot climate, for instance, where the main need is cooling, this is likely to provide an early opportunity for the use of solar power, which is currently expensive but is rapidly reducing it's costs.
In remote areas, or where the wind resource if good and we need a lot of power quickly, such as in a lot of the Great Plains in America, then wind makes sense.
The main issue with a lot of other renewable resources is that they will still take a few years to perfect the technology so that we can use it on a big enough scale to really count - for instance hot-rock geothermal power in Australia is undergoing exciting early trials, but it is far too early to start a massive build out.
Wind resources, by their nature, also vary greatly from area to area according to the resources available - there is far too much building solar power where it is not sunny going on - a good idea has to be capable of effective implementation in a particular context to be useful.
A pragmatic attitude which uses different resources according to their applicability would be the best way forward.
Nuclear power has a very big contribution to make, but many other resources will be useful and play a large part.
Perhaps the biggest contribution of all in the developed world is available simply by minimising use.
But how much uranium is available? Lets say nuclear increases 20-fold. Is there enough uranium for such extraction rates?
Here is the latest on uranium supplies:
http://89.151.116.69/ENF_Exploration_drives_uranium_resources_up_17_0206...
Exploration drives uranium resources up 17%
It should be noted that relatively little expenditure on exploration has resulted in a large increase in resources - the exact opposite of the situation in oil, where ever increasing expenditure yields ever lower increases in discoveries.
Also notable in this is that these resources estimates are based on a price of $59/lb.
Even processed fuel accounts for very little of the cost of running a reactor - it is mainly build and some maintenance costs.
Processing is also quite expensive, so the upshot is that a rise of 10 times in the price of uranium would make little difference to the cost of energy from nuclear power, and that increase would mean that supplies could be expected to increase substantially.
As mentioned in the link, we only burn a small fraction of the fuel at the moment, and designs exist which could be implemented in the next twenty years or so to greatly increase that percentage, neatly solving almost all of the 'waste' problem by treating it as a resource.
Thorium can also be burnt - and not just in future designs, but now in CANDU reactors.
It is around 4 times as plentiful as uranium.
Experiments have also been carried out to prove the practicality of obtaining uranium from seawater, but uranium is currently so cheap as not to make it worthwhile.
Supplies would then be enough for millions of years.
So there is no immediate concern, nor any strong reason to feel that supplies will be a significant constraint in the future, which is nice to know but in any case even if there were no long term future for nuclear power, it will certainly help a lot in giving time to develop renewables, which we currently do not deploy on remotely the scale needed to expand rapidly enough to solve problems at this time.
Systems need proper testing and development, nuclear power would give the breathing space to allow that for renewables.
Thank you very much, DaveMart!
I meant to add that, my above comments notwithstanding, supplies using current mines and reactor technologies are sufficiently constrained that uranium is very much a strategic resource, and may be a source of conflict.
India is looking to develop thorium reactors precisely because she does not have much uranium, and China is very concerned with reaching long-term agreements for secure supplies.
OTOH, large amounts of fuel could be obtained simply by reprocessing waste stockpiles - see this for the UK:
http://business.timesonline.co.uk/tol/business/industry_sectors/utilitie...
Britain holds £160bn stockpile of nuclear fuel - Times Online
You need to watch Professor Bartlett's video on growth.
http://www.youtube.com/watch?v=F-QA2rkpBSY
OK, so, at 1 million year's supply at current rates of usage. This 1 million year number assumes zero growth. Lets say 5% growth and see how long it would last... Guess...
At 5% growth, your "million year" supply would last about 200 years. At 3% it'd last about 350 years.
"At 5% growth, your "million year" supply would last about 200 years. At 3% it'd last about 350 years."
No it won't.
At 5% growth of the human population the earth will have 10 trillion people. That's patently ridiculous.
We already know that mature developed economies hit a limit on how much oil they use. Japan's oil use, for example has declined over the last ten years. So has Germany's. There are others. We don't NEED infinite growth of energy to grow the economy. And in any case we don't need to CONTINUALLY grow the economy. We have gotten along plenty wellin the past with periods of growth followed by periods of bust.
It's the natural way.
"We don't NEED infinite growth of energy to grow the economy."
Oh Really?
So what?
We have a desperate energy supply situation now, and you are theorising about what may happen in a couple of hundred years by extrapolating trends to absurdity?
There is a world of difference between allowing energy growth to taper off after supplying people's needs, as is happening now in the developed world whilst allowing the population to naturally reduce as is also happening now in the richer world, and allowing people to remain in poverty right now, and in fact to get worse so that they die by the billion.
Hey, you started it with your "enough for millions of years." zero growth absurdity.
You want to see an example of growth absurdity?
http://en.wikipedia.org/wiki/Image:Population_curve.svg
Actually, I didn't.
I said that the important thing was that we have a viable resource which can contribute greatly right now, and will certainly be sufficient for decades whilst renewables are developed, and may possibly last a lot longer.
So the whole subject seems to me to be a red herring, when what we should be doing is developing all available resources.
It is a bit odd that those most overtly concerned about running out of nuclear fuel are those most opposed to nuclear power, as one would have thought they would have been keen on that happening.
With nuclear I don´t think it is a question of resource availability. It is a question of human arrogance. We think we are smarter than what we really are. We build a nuclear power plant and fail to take into consideration things like human error, human frailty, boredom by operators, and centralization of power. Nature decentralizes and diversifies. When we do the opposite we tend to get in trouble.
And the proponents fail to take into consideration the disposal of the toxic waste.
And the opponents do not take into account the problem of the disposal of toxic waste.
In reality, we can't run the whole of society on renewables as we do not currently know how to do it, so not using nuclear has meant burning coal.
So Germany, for instance, has around twice the CO2 emissions of France.
Whole mountaintops are removed in West Virginia and the wastes allowed to pollute the water, while vast quantities of radioactive uranium is emitted from the smokestacks.
In contrast, the nuclear industry takes responsibility for the very small amounts of waste per person created, and it is only delay and obstuctionism to blame for better reactors which will use this small amount of waste as fuel not being available as yet.
So the actual e3ffect of not building and developing nuclear power as fast as possible over the last 30 years is that the climate has been endangered, and that China, for instance, did not have the alternative of buying cheap, factory produced nuclear power stations so had to build coal plants.
Millions have already died or had their health damaged by coal emissions, and billions could die from lack of energy and climate change.
Any risks from nuclear are minimal compared to this.
Everyone would be pleased if power could be produced by fairy dust, but in the real world of real choices enormous amounts of damage have been done by not confronting reality squarely.
Renewables have a huge contribution to make, but it is nuclear power and conservation which will give us the time to develop them properly.
One could just as easily argue that the expansion of coal plants was due to the U.S.'s failure to build out solar and wind power and improve efficiency more vigorously after Carter set the country on that path in 1979. We should have reduced immigration to stabilize the population, produced PHEV's instead of SUV's and stopped building suburbs.
Moving into the present we need to build out solar, wind and to a lesser degree the other renewables of geothermal, hydro and tidal, until they provide between 20% and 40% of the electric power to reduce, but not eliminate, our consumption of coal and natural gas. Centralized solar thermal can be built with storage, distributed grid-tied PV can be used to provide local peak demand and intermittent wind can be combined with pumped hydro where suitable to provide some storage. Canada can expand their hydroelectric capacity and sell some of it to the northern states. While we are building out that renewable infrastructure we fund research into electric storage and nuclear fusion, improve the efficiency of our electric consumption and cap our population principally by controlling emigration. We electrify our rail lines and build PHEV's, all the while reducing our fossil fuel consumption and thus extending its availability for critical uses. Either electric storage or nuclear fusion could be successfully developed to expand the renewables beyond 40% driving the final nail into the coffins of coal, natural gas and nuclear fission generators. Rather than just doing it, we have wasted 29 years merrily squandering fossil fuels and fighting wars. Because it will require decades to convert the electric utility gird, we do not need more nuclear fission power plants. We need to go renewable, sustainable and environmentally friendly now while developing superior technologies to complete the project, not expand out the most dangerous, expensive, environmentally unfriendly and horrible method of electric power generation (nuclear fission) ever conceived just because we have the proven technological ability. If we do not try, we will not succeed. Because we have had 8 years of anti-technological, anti-environmental Bush, little has been accomplished. Even if it ultimately proves that storage and nuclear fusion are impossible or impractical, we would have replaced nearly 50% of our electric grid with renewables (including the existing hydroelectric and improved efficiency) and would still have the options of large scale interconnected wind and solar or nuclear fission. We need a better plan than 100 or 1,000 years of using toxic, radioactive junk to make electricity.
I'm afraid this illustrates very well the complete unreality of may of the assessments which are made by advocates of renewables only.
Some of the measures suggested such as different zoning laws to discourage building out to suburbs are sensible ans should have been carried out whatever power source was to be used.
Others assume a level of technology which is only just looming into sight now, and would have been utterly impossible at the time - for instance PHEV's
To build modern batteries we need the full panoply of all our technology, including nanotechnology, modern computer systems and so on. We might have been able to speed things up a bit, but you can't just bypass 30 years of technological progress across a broad front.
Solar power is also dependent on the same broad range of modern technology, and we certainly are not there yet, at any reasonable cost.
So the choice in reality 30 years ago was between nuclear and coal, and they went with coal, at the huge cost in environmental impact, and at grave risk to the climate.
As for the future, I have absolutely nothing against introducing renewables as and when they become practical and anything like economic - for instance there seems a good possibility that solar will shortly be able to provide much of the peaking power in hot climates.
However, the present ability of renewables to run society is grossly exaggerated - apart from areas with hydroelectric resources or geothermal as in Iceland, they make a minor contribution to power.
Wind has potential,but for the present in terms of realistic engineering proposals it can only do part of the job at best.
I do not know who the 'we' is that do not need nuclear fission, but it certainly does not include the UK where I live, as it has dark long winters where there is little solar power and proposals to run this crowded country on renewables only are entirely fanciful.
Very shortly we are likely to get very cold, and I am somewhat irked about it, as we could have got on and built what would work, nuclear plants.
This is besides the fact that we may be killed anyway by climate change, as using the technology which was proven to be able to run an advanced society was blocked at every turn, in favour theoretically of a technology we did and do not have at the needed scale, renewables, and in practise to the advantage of the proven dirty killer, coal.
But how much uranium is available?
Uranium is an incredibly common element.
Just take a look at how many homes have "radon problems". Radon is a daughter element from the uranium decay chain.
IOW... the stuff is all over the place.
Uranium is incredibly common, and the vast majority of it is in very low concentration. The issue isn't running out of uranium, it's running out of commercially viable uranium ore. In that way, it's quite similar to oil--we won't run out, but soon it will take more energy to get oil uranium out of the ground and refined for use in a reactor than that the energy produced from the uranium derived. See some of the excellent writing on this site about this very issue.
Is it a done deal where nuclear power cannot play any role in our energy future? No. Is it highly problematic? Yes.
And here are counter arguments:
http://nuclearinfo.net/Nuclearpower/WebHomeEnergyLifecycleOfNuclear_Power
Nuclear Power Education - Energy Lifecycle of Nuclear Power
In any case there is not now nor is there any immediate prospect of a shortage of uranium , or even more so of thorium, which we know perfectly well how to use.
We also have the technology to burn it at a much higher efficiency at a high state of development.
This kind of theoretical projection is usually used in the service of an argument that if any conceivable doubt can be cast on being able to get enough fuel for the next few hundred years, then we ,should get on and go straight to all-renewables', which entirely ignores the difference between a theoretical prediction of a shortage and any sign that it is actually going to bite, ignores the fact that renewables are not in any condition to go to running all the power for large societies with present technology and anyway the quality of the resource varies greatly from area to area, and ignores the value of using a short-term resource to get from the present into this future.
It boils down to a few bods somewhere on fairly dodgy grounds have said that at some time in the future, if they have got their figures right, then there might be problems, so the best idea is to give up now.
The "exponential growth" thing... 70 million extra humans each year (9 billion by 2050), Chinese peasants becoming city-slickers, etc, etc... Surely that must factor in.
Or is "growth" about to flatline?
Regards, Matt B
The extra 70 million is going to occur whatever we do.
That doesn't mean we should do nothing as our problems may be insuperable, it just means that we are in a tough place and have to keep pitching.
If it were in our personal lives, none of us would direct our actions according to the very theoretical concerns that are some of the main subjects here.
If you lost your job and things were tight, you would not give up on selling your house and moving into rental accomodation on the grounds that you might not get another job, so you were going to loose everything anyway, you would get on with it and do the best you could and hope that would be enough to pull you through.
In the same way, you would not refuse to burn logs to keep yourself warm and prefer to freeze instead, if you became unsure that your supply of logs were infinite.
Comments that we should not use nuclear power because, in the view of some, supplies of fuel can't be guaranteed beyond a few decades are equally absurd.
Actually, they use some pretty extreme negative assumptions to get to that viewpoint anyway, but in any case the position is not a sensible one.
It is just an excuse to justify opposition on almost entirely specious grounds, when the roots of the animus lie elsewhere,either in an ideological opposition to large, industrial scale power on the grounds that it supports 'the system' or because of security concerns.
The security concerns would not appear to be well founded when lack of power and the complete fall of 'the system' would result in billions of deaths.
This is not to entirely disparage any group of people or declare all their efforts valueless, as important points have been raised about the need to look after the ecology, and to conserve rather than blindly consume.
Nevertheless, according to the above analysis the position regarding nuclear power would seen to merit re-thinking.
Most of the world is just getting on with it, so all the opposition is doing in the larger context is hindering the development of more efficient and safer advanced reactors rather than preventing their build.
You keep pitching Dave. Unfortunately all your bloviating on the internet amounts to exactly squat.
That was not his comment. His point was that population growth *plus* demographic transition puts any sustainable energy programs well outside of plausibility.
If you ever bothered to read "limits to growth" you'd understand this. Human population is in overshoot no matter how its measured.
But you keep insisting the future is unknowable. I'm sure it helps you sleep better at night.
I've read it thanks.
30 years ago.
I'll buy you a placard, so that you can go to the city centre properly dressed to advise the abandonment of all hope!
The rest of us are still concerned with events in the land of the living, and anyway, why should you care, since no good can come of it all?
Please don't bother telling me - I will leave you in peace with your clinical depression and sense of disempowerment!
Thank you, Private Frazier!
Dave,
It has been updated about once every 10 years, you are way out of date.
Check out "Limits to growth: The 30 year update". You'd be about 30 years up to date.
Seriously, it'd save this blog a hell of a lot of bandwidth and all of us a hell of a lot of bloviating.
I'm sorry if the truth is a little depressing. That's life.
I like beer, that seems to help a lot. Beyond that, I can't help you much. Just please stop wasting our time with your (intentionally) ignorant posts. It helps no one.
Giddaye Ed!
You were right about keeping my mouth shut at the party the other day (though I DID keep looking for an opening!). Seems an extra glass of red is the answer for now.
Oh well.
Regards, Matt B
You may enjoy red. I enjoy a good ipa.
Whatever it is it still beats keeping our yaps shut at social functions.
Unfortunately a hard learned lesson. One that is not unique on TOD circles.
Good luck in your journey. I wish you well.
Ed
I am aware that you think that your analysis is correct.
In fact you are so confident of this that you are sure that there is not the remotest possibility of any other analysis proving correct.
You also find it very annoying that others disagree with you, and say so.
The fact that if you are right billions will die does not seem to mean to you that it is a good idea to entertain other possibilities which might conceivably reduce the damage, so everyone should give up on trying to provide light and power in, admittedly imperfect, ways.
I have no idea what you imagine the point of such defeatism is, unless it is so that you can have the pleasure of being proved right.
On a purely percentage basis, if you are correct then we are doomed anyway, so there is no risk in trying to avert it.
If however there is a chance and due to a faulty analysis we don't take it but give up, then we have missed an enormous gain.
But I forgot, you are part of the true church, and there is no possibility that you have missed anything.
Your attitude seems utterly pointless, as apparently it merely means being resigned to most people dying.
If OTOH, you entertain some fantasy that really substantial numbers can be kept alive in some sort of 60's commune world, then you have not looked at the figures.
The ones who will die will object to it, and will fight to remain alive, history tells us, so the numbers who survive will be tiny, and survivalist fantasies are pretty much that.
You appear to have given up, and get annoyed that others haven't.
Utterly, utterly pointless.
Dear Dave, you've written a lot of words somewhat off-topic on your favourite thingy here. I'm not objecting to that. You present interesting ideas reasonably well.
But now it seems to me that you have a fundamental fallacy underlying your thinking. Your vision seems to be that by means of a temporary nuclear stop-gap, we can transition to a global society sustained by renewables, and avoiding a major population crash in the proecess.
I'm sure you're wrong. There are 6 Bn people alive today (and 60 Mn in uk) only because fossil fuels are enabling the production and supply of sufficient food for them. When that energy supply sharply decreases in the next decade or two, the food supply will inevitably shrink to a level that can only sustain 1 or 2 Bn worldwide, perhaps at best 20 Mn in the uk. A massive nuclear project could go a long way to keeping the lights on, but I'd be amazed if it could make much of a dent in that global food crisis, even if governments got their braincells together and acted on a coherent plan.
Maybe you have done the maths which I have failed to grasp, but I doubt it. The prospect of there being small groups of survivalist communes arduously hanging on in a world where most have died of starvation and thirst looks to me the most realistic vision of the population of 2050, in stark contrast to the fantasy of a rise to 9 bn.
As for the concept of grim fighting to survive, the majority of people have barely a clue what is going on, and will soon be sufficiently mentally devastated and exhausted by starvation that they will soon have insufficient capacity to threaten the elite minority who have prepared in advance.
We simply have to come to terms with the fact that most people will die of starvation/thirst anyway, including so many friends and relatives in denial. And no government can make plans which acknowledge this reality, so we are on our own (with just those who will work with us on own initiative).
Robin,
If I were a betting man, I would say we are probably stuffed.
If a major slide starts, I don't think that any survivalist strategy will hold the line, as humans are too warlike, so the idea that we will transition to some relatively pleasant, low power society based on renewables seems utterly impossible to me, as there is no way it could support anything like current numbers, and the surplus are going to fight.
In any case, renewables need development,as they are far too immature to do the job at the moment - for many issues, like storage, although we may have some idea of how we would like to tackle them, we certainly do not have a technology ready to roll out at the moment on a large scale.
So as far as I am concerned the only chance we have is to try to prevent a mass die-off, and to do that we need all the energy resources we have.
It seems the wrong time entirely to fuss over a lot of the very theoretical problems that some imagine, we are in a desperate situation and need everything we have if we are to have a chance at all, and that includes conservation, renewables, and nuclear.
For almost all the people alive today, if we do not manage to keep some semblance of business as usual, then we will stop breathing as usual.
The remarkable thing to me is that peak oil aware people, and global warming aware people, should want to chuck away the only well developed technology we have that is light on CO2 and uses a much more powerful energy source than fossil fuels.
Either lack of power or climate change could kill billions, so the objections which are commonly trotted out seem absurd.
The least it will do is allow some breathing space to develop renewables.
What have we got to loose by trying, anyway?
The alternative seems to be to accept mass die-off, as graceful power down is surely fantastic.
Dave, in your reply you seem to be advocating nuclear as an alternative to massive die-off. The fact that we might not want die-off is besides the point. I explained in my previous why a population crash is going to happen anyway - even if loads of nuclear were quickly developed. Saying how unacceptable that scenario will / may be doesn't constitute an argument against that inevitability.
Meanwhile I don't see the breakdown in quite the way you depict. The "surplus" have already chosen their doom by their lack of foresight and wisdom. Just for one example - how many people do you know who have even remotely sensible stocks of food and water? Of those who don't, how many have the faintest idea which people do have such stocks where (that they can steal enough of)?
The human race can be somewhat reasonably divided into the bad, competitive, people (skilled only at various forms of parasitic exploitation) and the good, cooperative (skilled at useful creation, product generation, positive useful wisdom). We currently live in a decadent society, in which the former parasitic lot dominate via their status in the authoritarian system and have most of the wealth.
When the fan gets the hit, the bad people will find their posh status titles no longer impress anyone, and their skill-sets fail to provide food and shelter once their institutions are defunct. And their stacks of "money" and other "ownership" also prove to be mere beliefs which no-one else believes in anymore.
The "wealth" of the wealthy nasties evaporates, and meanwhile it is now only the small number of wise, good, productive people who now possess the real wealth that is useful knowledge and skills and wisdom and genuine honest relationships (and the sensible investments such as hand tools).
Within weeks, most of the nasty people will have died of their own foolishness, along with the vast majority of equally clueless McSuckers. There will remain a much smaller population consisting mainly of the more positive people. They will generally be wise enough to appreciate that the locally surviving fellow humans, far from being a mortal threat are more likely to be a vital aid in cooperating in the daunting challenges of survival. Due to the stupendous de-learning that we have undergone in the last century, it will be those non-human challenges that will predominate. How many people do you know who'll be able to make you a decent pair of shoes (in an age when walking will be rather important)?
I am getting confused with the same message being sent to my e-mail - perhaps we could confine any discussion to this forum.
Briefly, as I said in my e-mail, I don't think any of us know enough to declare any outcome inevitable, although the odds do not look good.
I also feel that both duty and inclination point me towards doing whatever I can to prevent such a mass die-off, or mitigating it, and to do so we will need power, including nuclear.
The idea of being a member of some sort of remnant of the saved, living in a green paradise after the unrighteous have passed away, is both deeply unappealing to me, and also in my view entirely fantastical.
Bluntly, if things fall apart they will be screwed as much as anyone else.
We can either get through in some reasonable shape or there won't be enough people left to worry about.
To the more metaphysically inclined it is surely a consolation to know that we are all in this together, and we won't be left in peace to watch Africa or the folk we dislike locally to die while no-one damages our windmills which we are hand-crafting.
Clarification - I'm sure I'm not the only person who uses 'absolutist' language as shorthand for probabilistic meanings (indeed you apparently did yourself just there). By inevitable population crash I meant no more than "inevitable unless there is some extremely improbable development such as a fantastic new energy source, such as running cars on homeopathic water, or nuclear-powered allotments". In the absence of such extremely improbable developments it's a simple matter of inevitable maths that the food supply is soon going to be insufficient for the demand.
Trying to prevent the inevitable may be heroic, but surely only heroic folly. I'm not opposing your advocation of nuclear, only questioning how it can enable the maintenance of the existing food supply, let alone the required increase of food supply.
But who's proposing such a green paradise? Not me. I am merely proposing that when the population crash happens, almost none of the utterly-unprepared almost total majority have the foggiest hope of surviving. At best some of those who are well-prepared (and not too addicted to pseudo-wealth delusions such as "money" and "ownership") have some prospect of surviving.
My point that such a development will strongly favour decent cooperative people against the parasitic sorts that prosper in a decadent civilisation (as now) is nothing to do with moralistic idealistic wishes and everything to do with consistent historical experience, as indicated in for instance Arnold Toynbee A Study of History, www.zazz.fsnet.co.uk/decadenc.htm . You yourself put forward a notion that violence is sure to triumph, in the face of so much historical evidence of non-violence re-emerging time and time again indefinitely.
Of course the breakdown of our (supposed) "law and order" will also allow thuggery to prosper, but then the existing decadence already allows legalised thuggery to prosper right now.
My guess is that you might be finding the prospect I paint to be more scary than for myself, because you have more of the fantasy wealth to lose (I have near-none) and less of the real wealth to deploy. But at least you are forewarned, that low-tech knowledge and things are the way to go - before it's too late!
I copied my previous to your email because this is an elderly page (five days old) already bloated with 514 comments and these matters are miles off topic, plus I thought best to let you know I'd put that reply somewhere in that lot! In addition the viewpoint I am outlining here requires a lot more space to properly explain and this is a dud place to put it anyway!
Burning logs doesn't take a ton of investment in infrastructure that might be better used elsewhere.
Your analogy fails.
While way off from the original gist of this thread I'll give a few cents about Uranium/nuclear power.
I'm not at all opposed to it on engineering grounds I'm opposed to it because refinement of Uranium allows for production of atomic weapons. The difficulty of this refinement process is one of the few safeguards we have on this issue, not that the people who can refine it are responsible but the more limits the better.
I was taught a course at the Armed Forces Radiobiology Institute by an ex-submariner. He was extremely bright and healthy and he had spent part of a career 100-200 feet from an active reactor. There are ways to measure the danger.
He also presented a convincing arguement that there is more radioactive exposure from Uranium (I can try and reproduce this from some years ago if needed) from an active coal plant then from a nuclear plant. Think of the relative fuel consumption between a coal and nuclear plant and the trace uranium in coal.
Nuclear power (aside from the grave concern of weapons proliferation) seems commensenically to have led to far, far fewer work related deaths. "Black Lung" is a categorized sequlae of many coal miners work related exposure to coal dust, nothwithstanding other difficulties.
One common misconception is that nuclear power somehow increases ambient radioactivity. This may be true locally but radioactive uranium is gathered, refined and rather then being allowed to decay over tens of thousands of years is reduced to, in part, a stable element (lead if I am not mistaken) quite quickly.
While it would be considered insanity I have wondered whether the best way of dealing with radioactive waste would be a sand spreader sent to replenish a lesser amount of radioactive uranium from the sands from which it was gathered. Similarly, while absurdly doubtful, it would be interesting from an environmental standpoint if there were a need for life to have a certain level of ambient radioactivity and the net decrease in ambient radioactivity caused by nuclear power proved the life threatening environmental disaster. (how would one correct that?)
Well if you are concerned, go get a whole body CT, about equivalent to being, I believe, some two miles from Hiroshima. I thought this was going to relate to Gail's excellent post or even PO, yes, yes, nuclear power bad, but not because it doesn't work or isn't safe but because we might go boom.
Hi Z,
Check out the "Energy Vision 2050 - part I" post - it ties in nicely with your comments,
L,
Sid.
Will look to do so.
To understand the dangers of nuclear waste, it helps to distinguish two ways that radiactive material can harm one's body.
The first is that some radiaoactive material in one's environment can decay. If it's an alpha emitter, it most likely won't even make in through the air, never mind one's skin. A beta emitter has more penetrating power, but still not much. Gamma is a lot more serious - you'll want good lead shielding between you and and significant source! Still, the intensity decreases by the inverse square law, so a couple miles ought to be plenty.
The second pathway is that somehow the radioactive material enters your body, probably through your lungs or digestive system, and gets chemically absorbed into your tissue. Some time later the material decays. Now there is no atmosphere or skin to block even an alpha ray. Maybe the material is even in your bone marrow where it can mess around with crucual blood production processes. Anyway, the danger here is much more severe.
This kind of comparison:
misses the crucial difference between the two ways that radiation can cause damage.
You are correct that there are different forms of radiation. For purposes of my comment I didn't feel it worthwhile to discuss the decay chain of U235.
As for the whole body CT warning, this reflects the opinion of radiation Oncologist Dr. David Brenner (errr Brenner not Banner) a professor at Columbia University Medical school. In a research article published in September 2004 in the well respected peer reviewed medical journal "Radiology" Proffessor Brenner concludes there is an increased and cumulative increase in cancer risk from whole body CT radiation exposure. He comments on this here http://www.abc.net.au/science/news/stories/2004/1188854.htm
stating in part,
"The radiation dose from a full-body CT scan is comparable to the doses received by some of the atomic-bomb survivors from Hiroshima and Nagasaki, where there is clear evidence of increased cancer risk, ... The dose from a single full-body CT was only slightly lower than the mean dose experienced by some atomic bomb survivors, they said, and was nearly 100 times that of a typical screening mammogram. ... A 45-year-old person who gets one full-body CT screening would have an estimated lifetime cancer death risk of approximately 0.08%, which would produce cancer in one in 1200 people, the researchers estimated. But a 45-year-old who has annual full-body CT scans for 30 years would accrue an estimated lifetime cancer mortality risk of about 1.9% or almost one in 50."
I haven't pulled the Radiology article but I believe my two miles mentioned above to be correct. In any event you want to get a whole body CT scan for no clear reason, have at it, heaven knows there are lots of people making their money selling them.
Atomic bomb blasts cause harm in both ways - there is the immediate intense radiation from the blast itself, and then there is the fallout which can get absorbed various ways. Of course the shock wave and heat cause huge damage too. Fallout is slways tricky - the dust can hang around a long time or get blown around depending on the wind. My guess is that the CT dosage was being compared to that initial blast radiation, which wouldn't be too intense at two miles away. The fallout is so much harder to characterize - it's not just a function of distance from the blast. So that would be very difficult to compare against.
Your point is well taken and I apologize if I came across overly acerbic in my initial response. It is worthwhile to point out that there are different forms of radioactive decay. It is also true that x-ray exposure would be analagous to the flash exposure of a nuclear blast and that such a blast would also have fallout which through inhalation, ingestion etc could lead to radioactive harm and harm though such relatively non-penetrating radiation as alpha emissions.
Not certain why I am defensive, maybe my position about using a sand spreader to get rid of nuclear waste? Really what I find interesting though and I don't know about the half lives, emmission processes, etc. of spent fuel versus unused fuel, but there is no way there wasn't a net decrease in radioactivity by initiating a chain reaction of a radioactive element to a more stable element. The reactor doesn't generate the problem, it partially solves it, the problem was generated when uranium was gathered isolated and U235 refined. Now you have a big mess of U235 with a half life of 700 million years. I suppose if the other radioactive elements generated in the reaction have short half lives you could end up with a temporary net increase in radioactivity ... say for a million years. That is to say burning the fuel by definition causes a net decrease in available potential radioactive energy, but I guess it is possible that if the radioactive byproducts have short half lives you could still end up with temporarily greater radioactive emissions than you had with the U235. Actually, while I don't know I would be pretty certain that the radioactivity of spent fuel is immediately after burning far less than that of unused fuel. Perhaps I should try to read up on this.
That said assuming an overall net decrease in radioactivity by chain reactions rapidly converting radioactive products to stable isotopes, barring going to the moon, there is no present technology available to reverse this loss of radioactivity. (at least that I know of- think of the energy release in the nuclear reaction and now of trying to reverse it). I would strongly suspect such a change is beneficial and do not wish otherwise but I just consider it ironic that it is possible that the environmental harm done by nuclear power could actually be an irreversible decrease in the background ambient radiation of the earth. It is not entirely inconceivable, from an evolutionary standpoint, that vaible sperm production would be tied to the background level of spontaneous (radiation induced) mutations.
Alright, I've gone beyond trying to be defensive of this OT sci-fi novella. At this point I'm not even sure what the hell I'm talking about. Think I'll have a beer.
There is a third way. Being a heavy metal Uranium and its compounds are poisonous.
Nuclear proliferation is a real concern, but the idea that not having a civil program in the west would help does not bear examination.
Even at the peak of the West's power after the Second World War, attempts to prevent proliferation simply did not work.
First Russia, then China, India, South Africa, Israel, Pakistan...
The list goes on, and will not be halted by stopping nuclear power in the West, or trying to hinder civil nuclear production elsewhere.
To initially develop nuclear weapons took a substantial proportion of the productivity of the most powerful nation on earth.
The barriers have got lower and lower.
It is simply not possible for the West to keep other nations from acquiring nuclear weapons, save by using them on prospective producers.
And even that drastic action would worsen proliferation, as it would be clear that the only security was for others to develop nuclear weapons as quickly as possible to avoid a like fate.
Good points, you make a good case that the genie is already out of the bottle.
Yes pitt, and after that there are trillions of other stars we can count on too, right?
Some day those sources might not be too diffuse for us to harness quickly enough and/or in economically meaningful amounts.
If/when that day comes, then we can continue in the growth mode.
Until then, any growth comes at the cost of "demand destruction" (ie. economic death) of other regions of the planet.
I'm designing a wind-powered electric car. The faster you go, the more electricity you produce.
Consider the action where an organism orients itself toward a light source, also known as "positive phototaxis".
In saying that we cannot continue to grow indefinitely, that is, we are saying we cannot continue to usurp the resources of the world's ecology forever. We are saying that this growth process must eventually cease due to the finiteness of the Earth. A limited planet means we will run out of things with which to grow from, we will run out of space, or we will pollute ourselves with our own wastes.
This is similar to the action of moving toward a light source, in that at some point the organism is as positively oriented as it can be, and the action of phototaxis fundamentally ceases.
Does that make sense?
In saying that we cannot continue to grow indefinitely, that is, we are saying we cannot continue to usurp the resources of the world's ecology forever. We are saying that this growth process must eventually cease due to the finiteness of the Earth.
Yep... but that doesn't add one iota to a discussion of whether now (or a century from now or five centuries from now) is that time.
It's true, that these far outer limit arguments are not very relevant. But the irrelevance cuts both ways. Collapse is generally not some once-for-all turning point in the total history of the universe or planet or species. Jared Diamond's book Collapse shows how collapse is really something quite ordinary - they happen all the time, everywhere. The scale is generally too big for an individual human life. It may take a few centuries to give enough perspective that the historians can look back and say, "That was a turning point."
There are collapses of many different scales. A supernova evaporates a planet, an asteroid kills off 80% of species, the human species goes extinct... or maybe the population just gets cut by 50% over a couple centuries. Even if global trade went back to spices and gems, so folks got their food from a fifty mile radius instead of from the whole planet, just that could feel like some kind of collapse.
Neil Armstrong on the moon in 1969, maybe that was the peak. Not so hard to see things as declining since then. Sure, we have the internet. It was a lot harder for teenagers to get such explicit porn back in 1969. Is that progress?
Sure, we have the internet. It was a lot harder for teenagers to get such explicit porn back in 1969. Is that progress?
Let me see, 1969 was the Tet Offensive. We were killing teenagers at a pretty good clip. In a way, explicit porn is progress.
No, JimK, this is not just another collapse. This time for the first time it will be global and will involve a uniquely enabling energy source. It is truly the collapse at the centre of all human history.
And your response was argumentative and unhelpful, so here's your slap upside the head.
Assume there are 5 TRILLION barrels of oil. Assume 74mb/d consumption. You get 184 years of use.
But there aren't. We extract 40 - 60% from any given source. Call it 50%. (False. Much closer to 35%, but since this is responding to a BS statement, we'll keep it at the BS level.)
That gives us 92 years. Given 4 trillion of that 5 trillion isn't even oil, I'll give you an OROOI of say, 3:1. That's 68 years.
Now, how much of that is really going to be economically recoverable? 2 trillion? That's 41 years.
Gee... just about what people have been saying for quite a while... we've got about 40 or 50 years of oil at current rates of consumption. But consumption NEVER stays current because population never stays current and growth is the religion.
So quit being an arrogant ass. You knew exactly what the poster was getting at.
Cheers
That's a very specious line of reasoning: just because something continued to do XYZ in the past means it can continue indefinitely in the future!?!? I've seen arguments along this line many times before and it drives me nuts. Its like saying "because smoking hasn't given me cancer yet, I can continue to smoke and it will not give me cancer," or, "because people have been saying for years we'll run out of oil but, see here, there's still plenty left- therefore they must be wrong and we will never run out," etc.
Such logic is patently ridiculous.
On a finite planet there are absolute physical limits to growth - how can this be a matter for debate? The debatable issues are the precise characteristics of these limits and when they will be reached, not whether limits to growth exist. If exponential growth continues within a finite, closed domain, limits WILL BE reached somehow at some point in the future. It is a mathematical certainty.
That's a strawman. The specious line of reasoning is to claim that because something must end someday... today must be that day. All I offered was multiple examples of how that has been refuted in the past by real events.
It doesn't mean that today isn't that day... it just means that the arguement that something is "finite" doesn't hold any water at all.
I didn't debate it. That's the strawman talking. There's just no way to tell whether we are anywhere near that limit.
Of course there is!
Here's one report: http://www.unep.org/geo/geo4/media/index.asp
And another: http://www.ipcc.ch/ipccreports/assessments-reports.htm
Oh, by the way, to prevent this damage to our planet's ecosystems, it's not growth we need to limit, its our economic activities.
Phil, who wishes everyone would realise the problem is our system, not just its growth
Of course there is!
Repeating a mantra doesn't make it any more (or less) true... and a report predicting tight supplies in no way means that it must always be so. Such estimates are always tied to a particular price environment and particular technological conditions.
Lol! How can you claim that we don't need to limit growth and then in the same sentence claim that we need to shrink?
I'm giving you an UP arrow, not because I agree with you - I completely disagree - but you have presented your arguments logically and without rancor or trollishness.
I wish these stupid arrows and ratings would just go away. When you scroll the forum quickly they stand out like a peanut gallery. It's like a pro wrestling match where The Bad Guy enters the arena and everyone goes, "Boooooo!" Then The Good Guys come along and the crowd goes wild. "Yeahhhhh!!!!!!"
It's unbecoming. It's tacky.
Carry on.
Heartily agree.
Even heartilier agree. We decisively won the debate about these arrows but have yet to organise the required coup to depose the ruling regime! (Well, to be fair, we do so much appreciate them in so many other respects.)
The arrows are there for the convenience of those unable to articulate an argument, or present a rational thought, but who nevertheless feel that their opinion is as good as anyone else's.
It is great news that they enable my dog to take part in the debate, as she quite enjoys pressing the button, and I am sure she has a greater appreciation of the issues than many.
Aaaaaww! Shit!
Odograph is back as another sockpuppet.
"I didn't debate it. That's the strawman talking. There's just no way to tell whether we are anywhere near that limit."
Positive_Phototaxis welcome to the herd of true believers: They KNOW the end is near and they KNOW what the results will be. Logic doesn't carry much force when you already know what is true and what shall be. You are lucky that those little up & down arrows are not stones; you and I would both be dead by now.
puhkawn,
Just remember that because the down arrows outnumber the up arrows you can have a pretty steep down rating, but it does not mean that some folks are not up arrowing you (should I be using the words down arrowing and up arrowing as verbs?) :-)
So far I have found nothing wrong with Positive_Phototaxis logical structure. What he/she is saying is a statement of fact, but is the glass "half empty or half full" arguments can set people's belief systems on edge on both sides of the debate. It is very much an aesthetic argument, an argument about what we want, not what is technically possible. If for whatever reason I dislike the modern technical culture, I will find whatever evidence is needed to prove it is almost finished, because that is the evidence I am looking for. On the other hand if I love the modern technical culture, i will find whatever evidence is needed to prove that it will continue on forever, because that is what I am looking for.
Human culture is driven much more by what we want to see done than by what can be done.
RC
What?
I love our culture, our way of life. The internet and all of our wonderful medical advances are great. I have a fantastic life full of many modern conveniences. I would be very sorry if it all should end.
But when I look at the numbers (growth vs fossil fuels, the un-scalability of renewables in any reasonable time frame) I believe it will end in my lifetime.
CSS -spot on - the previous two comments were purest delusion.
puhkawn, if you can find the time, pop over and have a look at the first video at this Peak Oil Media post. It's an 8 min. summary of a 1 hour presentation by Prof. Albert Bartlett. Then after you've done that, have a look at this Peak Oil primer, especially the graph titled "THE GROWING GAP, Regular Conventional Oil: Discover & Production", under the heading "So when will oil peak globally?". Having done that it would be nice for you to explain to us true believers why you think the peak is not imminent.
The human race is very busy burning oil at the rate of about 87 million barrels day with Saudi Arabia and Russia together produce roughly 20% of that. Apparently Russia is beginning to decline and SA is struggling to increase production. Matt Simmons is on record as saying that when Saudi Arabia peaks, the world will have peaked. It would be nice of you to indicate what you think might replace oil as an energy source once it goes it to decline and how the world economy is to continue growing without a growing source of energy comparable to oil.
What makes people on TOD seem so pessimistic is that while the vast majority of the population at large remain unaware of the warnings that have been sounded and scenarios that have been predicted, things have been unfolding pretty much as has been predicted by some. JH Kunstler and Matt Savinar are probably not at all surprised by the events on Wall Street these past couple of days and would, in fact, suggest that worse is yet to come. The fact is, if we got the impression that, significant amounts of people were even just thinking about how they are going to exist post peak, we'd be a bit more hopeful but, the vast majority of people seem intent on continuing BAU forever.
Living as I do in the tropics, I am convinced the sun is going to play a huge role in my energy future. Ethanol from sugar cane, palm oil or jatropha oil may figure as liquid fuels, with biofuel from algae being the wild card. The only hope I see for anything remotely resembling BAU is that somebody figures out how to do this algae thing but, I wouldn't bet on it being any time soon.
Alan from the islands
I went to the big city for the weekend, a reunion. I rarely go to the city because I don't like the congestion, the hustle, the bad traffic, strip malls, look alike houses in look alike subdivisions, etc.. The air is bad, the scenery is worse, folks are largely anonymous, out of touch with others, isolated, lonely, abandoned. I came home to my dogs at the gate, a blue sky, good water, my garden, all of my friends, music nights on Thursdays, and my little log cabin. I have a very nice life and "GROWTH" has nothing to do with how nice it is. "Smell the Roses" is trite, but the world would be a better place if we all spent our lives "Smelling the Roses" and abandoned our never ending accumulation of things, a nicer house, better automobile, more money in the market, whatever. Who the hell cares? Here's the thing: We're all made of the same stuff. The final note is our death when the ledger is cleared and there is no difference between one and the other. Make a list of everything you are, have, have done, have accumulated. Include all of your associations, places you have lived, accomplishments, educational achievements, career choices, career successes,.....everything you can think of that defines who you are. Spend time with your list, months if need be. Legal pads are cheap. When you think you've got it all down, put it on the shelf for six months or a year. Then, one day get it down, sit with it, read it, digest it, ruminate, cogitate, and then accept that the definition of who you are is past tense, just words, meaningless, nada. Out to the porch with it and set it on fire. All that you thought you are is just a very long, and quite boring past tense description. Your stuff means nothing, it's illusion sponsored by the ego. What we need is enough; a roof to protect us from the weather and adequate food. Friendships are swell, accomplishment is swell, and enjoyment of the beauty of this marvelous earth on earth's own terms is wonderful. How can the lights of New York City be compared with the beauty of a snow capped mountain, a clear running stream, or a flock of ducks rising from a marsh? Best from the Fremont
Once in my life I walked outside of a hut on a moonless and extremely clear night at 14,000 ft in the high Andes.
Looking up I felt vertigo. The stars were so brilliant and the Milky Way so bright that I knew I was on the edge of the galaxy and spiraling around its core.
I cursed lights and pollution and understood that mine was one of a few recent generations that, since Edison and industrial pollution in general, had been robbed of this scene. The total awe made sense of ancient myths and animism.
I find it impossible to express the scene adequately. Fourth of July fireworks are crass and pathetic in comparison to a front row view on our galaxy.
Jason - I couldn't agree more.
I spent a good part of my youth at or around 10,000' elevation and seeing the milky way streach from horizon to horizon is an increadably humbling and grounding experience.
It's hard to be too impressed with mans best shot at dazzle when you have seen some of what nature provides.
"I have a very nice life and "GROWTH" has nothing to do with how nice it is."
On the contrary, you have a nice life because somewhere, some bank loaned the money into existence at interest that you have used to buy your land, that keeps you and your dogs fed, that built the cabin, etc. You could not possibly have "a very nice life" without the money economic growth provided for you to have it.
It is hard not to be angry when people who have so much think themselves morally superior to everyone else just because they're not chasing more. I aspire to the exact life you have and I have calculated it will cost about $300,000. Your nice life that has nothing to do with growth is entirely out of my reach unless I grow my business to the point that I have $300,000 worth of liquid cash lying around, or if someone hands it to me free and clear.
The end of growth isn't a problem for people like you, who already have "a very nice life" in place. For most people in the world, the end of growth means they will never be able to buy "a very nice life," regardless of how many stars shine in the night sky. So please, stop looking down your nose at people who actually have a legitimate stake in whether or not the economy grows.
Hello RabbitMountain. Thank you for your comments. I have considered them seriously. I make no pretense of moral superiority; I drink too much whiskey and sure like women and cuss with startling regularity. But, agreed, I have the nice life I now have because banks, along the way have lent me money. I'm as much a part of the system as anybody. My point is, I don't think the system has to be as it is. It is growth that is killing us. I'm not sure what the alternatives are. Perhaps we are doomed and will destroy our host. I hope not. I have found in my life, and I'm considered to be an old man now, that the bobbles of western civilization are meaningless. We can be quite happy without them. The difficulty is in breaking free of the trap that our culture is. One has no choice; housing is necessary, transportation is necessary, and adequate food is necessary as is clothing. Income is also necessary. But, there are alternatives; you can live in a Yurt, or build your own place from timber cut with a timber permit from the Forest Service. You can make your clothing from deer hides and sheeps wool. You can learn a trade such as Blacksmithing, or Saddle Making, or become a wheelwright, or a potter, a knifemaker, a basket weaver, or a small farmer growing organic produce. You can find a little piece of ground for lots less than $300,000.00. It is possible to break free of the bounds imposed by our consumer culture. But, the life is much different and most are fearful of what it might be like. My place is cold in the morning until I get the fire up in my stove. I eat the eggs from my chickens, I slaughter my own stock for meat, make my own cheese and yogurt, and I can all that I can from my garden. I milk my goats every morning and every evening. I weed the garden every day during the summer months. I tend my pastures, and care for and doctor, when necessary, my stock. I've developed skills as a Blacksmith for cash, when I need it. I'm sorry if you think I look down on folks. I don't. And, again, I am very much morally inferior, as most heathens are. You'd be welcome to stop by and visit. Best from the Fremont
If there's "no way to tell we are anywhere near that limit" what on earth have you been reading on this site?
All those numbers next to the arrows?
I used to study the morphology, evolution and distribution of species of a particular group of woody flowering plants (family Cunoniaceae). After a while it became clear that many of the species I studied were threatened with extinction. http://www.iucnredlist.org/ (Go ahead and type in the family name in that database. 10% of the species in the family are currently listed, but I know that this is a great underestimate since many have not yet been incorporated into the database).
Why are they "on the ropes?" Because people have taken over the habitats they grow in and/or climate change is going to wipe out their habitats because people burn fossil fuels and destroy soil structure through farming, etc.
In other words, expansion of human population and takeover of the environmental space on Spaceship Earth now imperils the fabric of life. Do human lives depend upon the species I study having their share? It would be hard to make the case for any individual tree or species, but for the services they provide at the ecosystem and biosphere level the case is clear. We are not only at the limits, we are way beyond them.
Picture an enthusiastic Wile E Coyote over the cliff face suddenly realizing his predicament.
Oh for heaven's sake.
How do you propose to counter right-wing arguments that leftists favor some shrub over humanity with that kind of hyperbole?
How come when any other resident of the spaceship kills something it's natural but the only one that goes out of its way to tend to the rest of nature gets all the blame?
Perhaps you should spend some time considering issues of scale?
PP - You appear to be a troll. In the future I shall ignore your posts.
I think the exact opposite. I disagreed with his posts up top. This one I completely agree with. We kill cockroaches, house flies and mosquitos with impunity. Maybe those insects aren't endangered as a species, but we are the dominant species today and it is the natural order for species to come and go and for certain ones to be more successful than others. The same will be true of homo sapiens one day. Maybe a big rock we don't see, or a germ or virus that catches us off guard.
Diversity in the biosphere is great. I don't advocate wiping out any animal or species for the hell of it or for sport, or even for pure profit, but shit happens.
the discussion was over statements like:
it just means that the arguement that something is "finite" doesn't hold any water at all.
And when something is shown to be finite, rather than go 'yup, looks like I was wrong' - your response is
Oh for heaven's sake.
How do you propose to counter right-wing arguments
Perhaps you should consider drinking less of heaven's sake and stick to a point?
"Spaceship Earth"...hey another Bucky follower..."expansion of human population and takeover of the environmental space on Spaceship Earth now imperils the fabric of life"...I would say it is merely a temporary imbalance to the equilibrium of life. There will be a swingback to the balance some day.
But we are no where near peak energy, that is, the total amount of energy that it hitting the Earth from the Sun is massive compared to how much energy we use right now.
Given that, it's fair to say that we can expect growth for awhile longer, and after that, the Universe is a massive place with lots of energy and matter to consume.
While I agree that it might get hard as we shift from one energy source to another, I don't doubt that we will come out of the other end and continue to grow.
I think we may be at or near peak usable energy.
Previous civilizations have run on purely a solar budget, and none of them were able to reach our level of complexity. Which suggests to me that maybe it's just not possible.
I do.
I think more and more of our economy will be devoted to energy extraction, meaning less and less will be available for other things (such as R&D, education, and maintaining our standard of living).
Energy is neither created nor destroyed, so all the energy we have ever had, still exists. Gathering it up, well, that's another story.
The low level of complexity for previous civilizations is not just due to their low-level energy inputs/utilization, it also has to do with how they obtain knowledge, transmit knowledge, and apply knowledge to solving problems. Something as "simple" as the scientific method has had a huge impact on our ability to find solutions to problems. That is because we rely on empirical data, rather than codified "wisdom", to solve problems. (I say "we" referring to society as a whole).
One could argue that Egyptian and Mayan civilizations were also highly complex - look at the Pyramids. That was done without any oil burning.
One may argue that computers and the internet were enabled by cheap energy. That may be true, but it is besides the point - we know how to make computers now, and won't forget tomorrow. And computers continue to get more and more efficient. If (when) electricity becomes 100-fold more expensive than now, it is very likely that the result will be extremely power-efficient computers. I carry more computing power on my iPod touch than I had in a large and inefficient desktop computer back in the early 90's. Thats maybe 1 watt for the iPod, versus hundreds of watts for the desktop computer, to accomplish the same tasks (actually, the iPod can do more...)
The reason I mention computers is that they are critical for maintaining and transmitting information. Just look at this discussion we are having. No society in history has had access to a medium like this, where information and ideas can be transmitted across the globe in milliseconds. I have learned a tremendous amount about various aspects of alternative energy and battery systems simply because of the internet. That will help me deal with future energy limitations - as it will help many others in a similar fashion. In my case, the approach this has facilitated is my reduction of energy usage (I ride an electric bike every day that gets the equivalent of 2000 mpg, more when I charge it via Solar) - rather than finding a "new" source to replace oil. Another example: recently I became curious about solar concentrators and their use for electric power. Within seconds of Google searching, I came up with a huge collection of information on ways to build solar concentrators and to use them for generating electricity. If I wasn't so busy, I'd go out in my back yard and build one. The parts required are nothing fancy. But the key is the knowledge of how to build one - and that is increasingly available. Will energy limitations reduce the flow of information? Perhaps, but I'd argue that it is not highly likely unless there are other events aside from energy limitation that destroy communications infrastructure (e.g pandemic, war, etc).
Just so that I don't get voted down into the abyss, I'll be clear that I'm not a utopian. I think hard times are on their way due to our utter dependency on cheap oil. Where I diverge from Leanan's viewpoint is that I do not think that oil resource limitation must necessarily lead to a reduced complexity of societies. It may in some cases, like the USA, because we are so dependent on oil. But some other society may well come along and figure out how to maintain a complex society that functions with drastically reduced energy inputs.
Morgan
This is a common argument, which I don't find very convincing.
Knowledge can be lost, even very useful knowledge. The Egyptians and Mayans you mention are cases in point. They lost the ability to read the writing of their ancestors.
As Tainter puts it...there's a cost for complexity. Overhead, if you will. In order to have experts designing and building computers, we must have enough surplus resources to support them. Not only people to feed and clothe and shelter them, but people to teach them, and people to support the teachers (and the teaching institutions).
I don't think we're going to plummet into a Dark Age tomorrow, but as times get tougher, I could see us losing our ability to support such experts, and the educational system that produced them.
After all, it wasn't so long ago that many Americans dropped out of school to help on the family farm.
This concept is explored in quite a lot of depth by John Ralston Saul in his book The Unconscious Civilization (http://www.anansi.ca/titles.cfm?pub_id=44). In this book he discusses, among other things, the likely maximum proportion of non-productive economic activity in a society. 'Non-productive economic activity' is obviously a context dependent concept, but would include many (most?) aspects of education in a subsistence culture.
This is a common reply to this common argument, which I don't find very convincing.
Certainly knowledge can be lost, but our means of preserving knowledge are much more sophisticated and durable today, even without computers and electric-powered machinery. There are so many copies of copies of the great works of philosophy, mathematics, engineering etc. that for all that to be lost it would take a very abrupt, apocalyptic discontinuity in human history, such as a global thermonuclear war.
As for the experts and our ability to support them, two things: 1) academia has been very resilient so far to economic disasters; think of the Great Depression, and how many seminal discoveries were made in physics alone during that period and 2)there is no reason these experts cannot be economically productive at the same time as they learn. Agriculture experts can work on farms. Literature and religion majors can be teachers, storytellers or ministers (all of whom are found and respected in even the most backward societies). Philosophers and scientists can be physicians or judges. The modern divide between academia and the rest of the economy is fairly recent.
Even in the face of economic hardship, people crave knowledge, artistic stimulation, spiritual comfort. There is no reason academia cannot supply that, if it removes its head from the sand and tries to make itself relevant to people.
Sometimes eccentric geniuses can productively work as patent clerks.
That's a very serious misunderstanding there. Just because knowledge is preserved in multiple printed copies etc does not mean that anyone exists who reads let alone understands that info. And great works and great info are right now being buried under a deluge of publish-or-perish drivel and corporate deceit-"research".
In my experience the phenomena of de-invention and de-skilling and de-learning are very very real and are going to prove catastrophically important, not least to those who have faith in the above-cited fallacy. Excell posts by Leanan, should be one of the editors. Huh, is already.
Leanan said,
"I think more and more of our economy will be devoted to energy extraction, meaning less and less will be available for other things (such as R&D, education, and maintaining our standard of living)."
But can those be seperated? Energy extraction (not just oil extraction but ENERGY EXTRACTION) will require R&D, education, and is the only way we can maintain our standard of living.
RC
Roger,
Honest question here.
Have you read Tainter? Because what Leanan is saying is drawn exactly from Tainter's work.
I have read some Tainter, but I admit openly that I would like to study it in more detail. I have read more reviews and discussions of Tainter than Tainter himself in all honesty so I do not feel qualified in discussing his work in deep detail.
I am familiar with the philosophical debate concerning "complexity", and find it fascinating, that's why I want to study Tainter in more detail. I want to see exactly how he defines "complexity" in the context he uses it, and how directly he relates it to energy issues.
I really feel that in the big picture a modern renewable energy culture could be far less complex than the fossil fuel culture. I know that is almost impossible to prove, but I think that argument can be made.
I am fascinated by the idea that seems to be popular among those who believe in "collapse" due to lack of oil that if oil production declines, education, culture, and art disappears and we revert to some type of animal that walks upright. It is though the idea that oil discovery, extraction, and use created the human mind. In reality, it is the human mind that gave value to oil. Beethoven, Bach, Goethe nor Rembrandt ever drove a car, but it did not seem to prevent them from creating art. In fact, most of the great art, philosophy and education occured before the age of oil. One could even make the philosophical argument, based on history, that the oil age has been destructive to culture.
But to Tainter, he is on my reading list, I really want to understand what he is saying exactly, because so many smart folks here seem to respect him. By the way, have you ever read Toffler? :-)
RC
Tainter doesn't claim all art, culture and education disappear. He points out that a society has 2 choices when confronted with difficulties. It can respond by becoming more complex or by reducing complexity to a lower, more sustainable level (which includes collapse, but not always). Increasing complexity comes with a declining marginal return, and is eventually self defeating.
Greer expands on that with the idea of catabolic collapse. I suggest you read The Long Descent as well. (I'm still waiting for my copy of that to be shipped to Japan).
And yes, I have read Future Shock. I wish that was the worst we had to worry about.
"(A) Previous civilizations have run on purely a solar budget, and none of them were able to reach our level of complexity. (B) Which suggests to me that maybe it's just not possible."
I don't think theres a logical link between your (A) and (B).
First of all I question whether or not the Chinese or Roman empires were a lot less complicated than modern civilization.
There are more interconnections, sure, but the basic system is the same: Goods manufactured in one region from raw materials in other regions, transported over long distances and then transported and sold primarily in cities. Agricultural regions specializing in agricultural products which are shipped to cities. Centralized government with distributed hierarchies.
A postal service.
From 30,000 feet the systems are pretty much identical.
Sure we have electricity now and we have oil powered machinery but the first iteration of powered machinery was built by hand without any oil input at all.
That we cannot have infinite growth in resource usage on a finite planet is logically sound.
That we cannot have infinite economic growth is more questionable.
That our system has reached levels of complexity that are unsustainable is questionable.
That our system has various stress points that could lead to a collapse to a lower level of CONNECTIONS because of the just-in-time system dependent on an oil powered transportation system is a very, very different question than a complete collapse.
I must climb on this odious bit of trivia. I have seen it many times (usually from solar panel marketers) and I think it should be banished.
While technically true, compared to our present direct energy consumption, it completely ignores the fact that we live in a system. Every scrap of fresh water in this world was evaporated, and transported by the sun. Every calorie of food we take in started waaay down the food chain in photosynthesis. Every piece of lumber in our homes and the wood in our fireplaces are there due to solar energy. The list goes on ad infinitum.
Until we grasp the myriad number of ways we avail ourselves of the sun's energy, we will continue to push the system to the limit.
There are limits to growth. This has been demonstrated thousands of times with various species, from yeast to wolves. I don't understand how people can posit that some very basic rules that apply to every other organism on the planet don't apply to us.
"There are limits to growth. This has been demonstrated thousands of times with various species, from yeast to wolves. I don't understand how people can posit that some very basic rules that apply to every other organism on the planet don't apply to us."
This is a huge area of confusion though.
There are many many people who are conflating the word "growth" with economic growth.
The word "growth" is very broad in it's application and this is the source of disagreement.
I take the position that of course, infinite population growth and infinite resource usage is impossible.
If we capture every erg of usable solar energy, there is a limit to the number of human beings that could live in such a system. What is that limit? I don't know but it's finite.
When you start to take that argument outside of it's domain and state "economic growth is limited" that's when I disagree.
We can have economic growth if we decide to cut each other's hair an extra time per week.
The creation of KNOWLEDGE can create economic growth.
IF there is indeed a limit to economic growth I think we're nowhere near it.
Dan:
Giving it some thought, I agree that economic growth, which is part "real" and part abstraction is different from growth as we commonly perceive it.
That said, economic growth in its simplest form means exchange of goods and services with a gain for each party. To do that, inputs are needed. These inputs are typically energy, materials and knowledge. As our knowledge increases, we reduce our need for energy and possibly materials, but ultimately economic growth is constrained by physical limits.
So, the economic growth rate will be determined by any energy and materials in excess of needs. If there is no excess, then the economy, and population, will contract to a new equilibrium.
The realities of population growth, climate change and resource consumption mean that a large correction must occur in the future. In order for your possible scenario to be sustainable would require a highly ordered and regimented society. Strict population control is just one example.
Unfortunately, we have many different societies, and most of them are very chaotic and messy. So, human nature being what it is, even if you are right in theory, it is very unlikely to happen in the real world IMO.
Perhaps that depends on how you define "we."
E.g.:
Avg. US oil used per person per year: 26 barrels.
Extrapolated to total population: 174,200,000,000 b/yr.
Assume 2 trillion economically extractable barrels: 11.48 years of oil.
If confined to the current US population: 273 years of oil.
So, who is "we?"
There sure as hell are limits and we sure as hell are right up against them because no country is looking to go backwards, only forwards. Unless the paradigm changes, calamity after calamity awaits.
Cheers
Yeah, and we have used the past century or so devising more and more ways of burning millions of years of ancient sunlight. Now that we've become expert at it, we face the decline of our primary liquid energy source within our lifetimes and we haven't quite figured out how to harness sunlight directly, at anywhere near the rate we need to in order to "come out of the other end and continue to grow".
We really need to start using renewable and nuclear energy on a massive scale and as Matt Simmons so eloquently puts it, "we've run out the clock". If you've ever see a basketball game that was won or lost by that last long range three point shot at the final buzzer, ask yourself, is that how we should be playing the energy game?
Alan from the islands
Wow! A negative 26 rating for a simple factual post?
Shouldn't that tell you guys something about the blinders you have on?
It's a simple statement of fact. The fact that some resource is "finite" does not mean it will run out today or in your lifetime.... just as a claim that a resource is effectively "infinite" doesn't mean that we can access every bit of it that we "need" as we want it or that we can waste any amount of it.
Hint... if your belief in peak oil rests on this notion that it's a finitie resource and therefore (insert whatever you want after "therefore") then your belief is a religious one... not a logical one.
Factual is debatable. When someone describes one resource or another being depleted; this is an observation based on reasonable evidence. It may or may not be a 'fact'. When someone describes one resource or another as NOT being depleted, that is also an observation that may or may not be a fact. Here, the issue is not so much the actuality of depletion, but whether it is wise to consider the possibility that this might be so as to prepare for it, should the possibility become effective.
The issue is two- fold: at the policy level, what should the responsible parties do to prepare. The other side is what responsibility does an INDIVIDUAL have.
Since policy tends to outlast individuals, it is simple prudence for governments to prepare for situations that might have serious outcomes over long periods. Conmsequently, it is the policy of the US government to have a military, a central bank, a court system, a Justice Department, a FEMA and so forth. The government(s) has been engaged in the analysis of current problems and the probability of future hazards; right now the government is forming policy to deal with financial disruptions, climate change and ... peak oil. People can quibble about the potency of the policy- making process, but the duty of governments is to prepare the country for future hazards ... and to do so even if only for insurance reasons.
How can it be unwise for policy makers to consider peak oil along with other hazards? If there are no peak resource issues, is it still wise for countries to be wasteful?
Individuals have a similar responsibility towards awareness. This does not mean automatically agreeing or disagreeing with one or another aspect of a problem. There is certainly room for disagreement about many aspects of the fuel/energy situation. But it is important to become versed in the core issues of this situation and be open- minded. This is self- preservation. At the personal level, there will be practical consequences to ignoring aspects of this problem. A large level of responsibility lies with the individual ... regardless or what official policies are.
Even if the government and codes allow a person to build a house in a flood plain, it isn't wise to do so unless the person can accept the destruction of the house in a flood.
**********
As for the financial scheme ... it is clear the Post- Bretton Woods currency and credit structure is broken. This is a failure of economic theory; a failure of the economic 'operating system'. Unfortunately, the current, broken economy is what we're stuck with and the players all have vested interests in salvaging the current structure. It will take quite a few years for the broken structure to be dismantled and a replacement designed. Any new system of credit will require a rebirth of trust ... which will very hard. Without credit, there is no growth; even if there is plenty of fuel, without money to buy it ... it may as well not exist.
Bottom line; prepare for no- growth and a gradual increase (relative to income) in the value of fuels and other necessities.
Nope. Sorry.
You must be newer here than I am. The discussion here is rarely that there is a possibility that peak oil will occur sometime and we should plan for it. Peak oil is a present reality and current market disturbances are directly related to it... and we're on our way back to a world like it was before oil.
And the "answer" to both is the same. It's the same "solution" that was proposed when global cooling was the fear-du-jour and the same "solution" proposed for global warming; a declining standard of living.
Depends on what the cost is. The proposals, after all, are not just "thinking about it". They require expensive actions. Let's face it... you're not just looking to "consider" it. Also... most on the peak oil side actively oppose proposals to produce more energy.
Would it be "unwise" to take hundreds of billions of dollars out of the economy to prepare for peak oil if it turns out to be a mistaken belief? Of course it would.
That's far from "clear". Abuse of parts of a system do not make the structure itself inferior to what it replaced. I'd think that anyone watching the gold bubble popping would rethink making that into "money" again.
Assertion.
Assertion.
Assertion.
What facts?
Sorry... repeating a falsehood doesn't make it any more true.
This is simple logic. You make a statement of fact and assert "Since A therefore B". All I've been telling you is that "A" being true does not mean that B is true.
The "assertion" without facts here is that A implies B.
It doesn't.
Positive_Phototaxis,
So your position is that natural resources(oil, coal, NG, Coltan etc) are not depleted? And further, you are asserting that we can not know when they will be depleted?
Is that an accurate representation of you argument?
So your position is that natural resources(oil, coal, NG, Coltan etc) are not depleted?
Didn't I just call that a strawman? How could you then ask whether I would accept the straw position as my own?
Normally that would be a sign that you weren't very confident in your own position.
"Depleted" just means that there's less of it than there was before. So by definition it's depleted. But that's true whether you've used 75% of a resource... or 50%... or 2%.
And further, you are asserting that we can not know when they will be depleted?
You can't possibly know. Because "finite" doesn't mean that there is any known (or knowable) amount... just that it isn't unlimited. If, for instance, you discovered an oil field under your home that was 25 times the size of everything the Saudis ever had... oil would still be a finite resource. But by comparison to current demand, it wouldn't matter.
On a blog it's easy to bandy semantics and debate linguistic technicalities, but in the real world we have to deal with opaque situations and vague data, and each make our own best decisions with what we have to work with. This forum will not 'prove' peak-oil to your satisfaction until it's far too late. At the point that the peak is a foregone conclusion, there will be little time for you or society to react.
For me it's a classic four-quadrant probability question with the possibility of error regardless of choice.
If I elect to believe the peak is near, and it is, I'm optimally prepared for sustainable (or at least self-reliant) and relatively low-impact life and hopefully my kids are too (especially since they'll likely be living on the South 40). If I'm wrong, then I have led a well-prepared but simple life, and I've perhaps foregone some financial gains and lifestyle options that I and my family might have enjoyed.
If I elect to believe in a distant peak, and I'm right, I get to live a highly-consumptive life and retire relatively young while waiting for a welfare state to care for my old-age illnesses and my kids to fly home for a visit with the grandchildren. However, if I'm wrong I'm in debt, unemployed, with no "base" to live in and no ready means of self-support, and I'm stuck there with a bunch of others in a similar plight each struggling for survival, while my kids suffer around me.
I still hope for BAU, but I'm changing my behavior based on the assumption of a near-term peak. For me the timing is of significant interest because I'm so late starting and I have hard decisions to make, but I'm increasingly hopeful I'll have a few more years to prepare. You might too.
My apologies if I misunderstood your position.
But are you asserting that it is impossible to know the size of a finite resource? Yes?
But are you asserting that it is impossible to know the size of a finite resource? Yes?
Not "any" finite resource, but certainly for oil. The amount in existance that we know about (ignoring how recoverable) has gone up for many decades... but that isn't because there's any more of it - we just happened to find some more.
Do you understand the data you just posted? If so... why would you offer it as refutation?
Can you explain why the only part of the graph that supports your position is the "imagined" part at the end?
So your position is that we are going to suddenly start discovering upwards of 30 gigabarrels a year just to offset depletion?
I'm sick of these bullshiat "the future is unknowabele" arguments. Stop wasting my time and this blog's bandwidth if you've got nothing better.
Its very clear "The amount in existance[sp] that we know about (ignoring how recoverable) has gone up for many decades." is not factual.
Why you would even attempt such an asinie argument here is beyond me.
Depends on what you mean by "discover". Does that include existing fields that have more supply than first assumed and existing known supplies that were previously unrecoverable (economically) but are now recoverable?
far better than the "future IS knowable and I know it!" BS from a heard of boy's who cried wolf many MANY times before.
Hint... when/if the wolf finally shows up... it doesn't mean that the boy knew what he was talking about.
Strange how the current known supplies are so much higher than Hubbert's predicted maximum of just a few decades ago. How did we go from a maximum of 1.25 trillion bbl to over 8-11 trillion in five decades without the amount in existance going up?
Please, spare me the Freddy Hutter "reserve growth" argument. It's tired and more than a little pointless. Even when the discovery graph is corrected for "reserve growth" it does little to change the curve.
This would be much easier if you'd know what you are talking about. Hubbert never made any global predications because in his time global reserves were much too much of an unknown. He did however venture two guesses about US lower 48 production based on two guesses of URR. And he was spot on btw. As WT will gladly point out even URR varying over a very large amount made little difference in the ultimate peak in production.
LoL! What a laugh!
You insist that someone else doesn't know what he's talking about and then make clear that you're the one with the problem?
Try reading his 1956 paper.
If you're not going to read what you reply to... why reply? He made lots of predictions and most of them were flat wrong. Picking one that was right is no more useful than claiming that I knew what number the roulette wheel would stop on.
You also ignore that we're now almost four decades beyond his predicted peak on nat-gas yet aren't on the downside of the curve.
And yet again... the known amount of oil is several times what he said the maximum would be five decades ago. You can pretend that this doesn't reflect any increase... but you'll just look silly doing it. :)
Depends on what you mean by "discover".
Definitely the "odograph style" stubborn and devious mendacity.
Interesting comparison Kevembuangga. Not identical but suggestively similar. Still, benefit of the doubt and all.
Positive_Phototaxis' habit of ignoring questions which need to be answered with specifics, and instead attacking the more ill-defined comments will get him ignored. Oh, and the one word answers without any exposition is really annoying.
If Positive_Phototaxis is serious, he needs to come to the discussion with facts and falsifiable statements, and leave off the rhetorical distractions. Otherwise, TODers will think he is a troll(or a tool).
BTW: I love "stubborn and devious mendacity"...that's an elegant construction. Can I steal it?
"stubborn and devious mendacity"... Can I steal it?
'f course.
Mr. Phototaxis sounds a lot like a known troll that has made sporadic appearances here in the last weeks with a different name
Isn't it amazing how one person who thinks that you're wrong about something sounds remarkably like someone else who thinks you're wrong?
And isn't it childish to assume it's all the same person just trying to be a troll?
This is the graph I was alluding to in a previous post and apparently you do not uderstand what that graph implies. Let me try to explain. There have been significant discoveries over the years trending upwards untill the mid 60s. The bulk of these discoveries were made using what would be considered primitive technology by todays standards. Despite the advances in seismology, the size of discoveries has been trending down since the mid sixties.
In the meantime annual oil consumption has be steadily rising with a few interruptions when supplies were constrained and prices rose. Sometime around the early to mid 80s more oil was produced than was discovered and that gap has grown disturbingly larger. You should be able to figure out that this situation can not continue indefinitely so, we are going to have to suddenly start discovering a lot more or somehow figure out a way to make as much as we want using some unlimited (renewable?) resource.
Here's where you have to depend on M King Hubbert's position that for a given province oil discovery follows a bell shaped curve. This data is for the whole world and the imagined part is a smooth extrapolation of the declining trend. A crude analogy might be a haystack with some baseball bats, rolling pins, pencils, nails and needles lost in this haystack. As far as planet earth is concerned Ghawar and Cantarell might be comparable to baseball bats, while Alaska and the north sea might be comparable to rolling pins with lots of other discoveries comparable to pencils, nails and needles. Do you really think we are going to be finding any more baseball bats or rolling pins or, are we going to be left looking for pencils, nails and needles in our proverbial haystack?
There may be more oil in relatively unexplored parts of the planet like Antarctica and the Arctic but,I wouldn't bet the farm on that. You could point to the recent discoveries offshore Brazil but, AFAIK these deposits are under thousands of feet of water and are going to be quite expensive to produce. Estimates of future production based on yet to be made future discoveries are a huge gamble. I'd be much more comfortable with the projections done by qualified geologists based on known resources and current trends in discoveries. Bearing in mind that many people on the forefront of the Peak Oil debate are experienced geologists, are you comfortable second guessing them? Reality aint always nice.
Alan from the islands
And yet the only reason you can see for that is "there isn't much left to find"?
It couldn't possibly be that there wasn't a need to look as hard at $20/bbl as at $150?
The greater problem with the position, however, is in how you score when something is "found". Large supplies are beginning to be developed in places where we new there was lots of oil "in place" but couldn't get to it at anything like an affordable price. When does that get "scored" as discovered? When they first make an estimate of how much oil is there or decades later when they determine they can now get to it and there's ten times as much as they thought?
Here's where you have to depend on M King Hubbert's position
Can you evaangelize a non-believer by saying "first you'll have to accept that everything in the Bible is 100% true... then you'll see that what I tell you is correct" ???
Do you really think we are going to be finding any more baseball bats or rolling pins
Almost certainly (though probably not gwahar-sized)... and not necessarily "conventional" oil.
You see... it's easy to dismiss new technology as "pie in the sky" because you can't prove what/when something will be developed. But history is quite clear that these things do come along and then everything changes.
Take natural gas. Hubbert thought the US would peak there first (depending on which prediction you look at)... and decades ago. Debates I had with peak-oil proponents just months back showed that they were quite certain that the peak had recently passed... and market prices sure seemed to support the claim. Only now prices are declining rapidly and not just because of expected demand declines... because new techniques make it pretty clear that natural gas production is spiking upwards.
When does that get scored as a discovery? When people first knew the shale was there and had an undetermined amount of hydrocarbons? Or when the technology that made it viable was discovered?
Remember that reserves are almost always calculated based on the amount that is economically recoverable. That change (whether due to technology or rising prices) is far larger than the annual "discovery" stats. There's multiple times as much already-discovered supplies as everything we've ever extracted... you don't need to discover a single new drop if prices/technology make larger percentages of that recoverable.
There may be more oil in relatively unexplored parts of the planet like Antarctica and the Arctic but,I wouldn't bet the farm on that.
And yet that's the boat Alaska was in just decades ago... remote and relatively unexplored.
Is that a standard you're willing to live by? Because there are lots and lots of experiences geologists on the other side too. And despite the frequent paranoid accusations, they have no reason to lie. Why on earth would you pretend there was more oil available than people feared if all that means is that you existing production will constantly sell for less than you could otherwise get? Heck... why wouldn't they lie the other way? Why wouldn't they construct an artificial peak so that they could sell their product for far more than it was really worth (as with diamonds and DeBeers)?
What can I say? Wow.
Tell you what, we'll just tap into those massive oil reserves under Washington D.C.
I mean, nobody has looked there, so there must be reserves to rival the Saudis' if we only drilled there.
It isn't like oil field geologists would have any idea where to look, and would willingly ignore places that could have elephantine oil fields, is it?
Wow... the old "everything that can be found has been found because the people looking are really smart" line. Couldn't see that one coming.
Shall we call that the Charles Duell school of science?
I suppose it's pointless to point out that you obviously didn't read the debate? Yeah... I thought so.
Just a point of inquiry though... the most recent big discovery (Brazil... whatever)... how did they miss that one?
Sorry, I should know better than to feed trolls. Done.
Er, because the reservoir is some 6 to 7 THOUSAND METERS under the surface of the ocean. That's a at least a quarter of a mile short of 4 miles! For an analysis of that find see this post on TOD Europe.
In summary the oil is under at least 2000m of water, another 2000m of rock and another 2000m of salt with extreme temperatures and pressures to have to cope with.
Are you a geologists? It's not just that the people looking are really smart. They pretty much know where to look and where not to.
Assuming that the geological formations favorable to oil discovery existed at the bottom of the Mariana Trench, how much good would it do to discover an amount 10 times the size of Ghawar there (10,000m under the surface)? At some point, when the effort and costs to extract oil get to a certain level, extraction becomes pointless.
Alan from the islands
Positive_Phototaxis,
It is you who clearly don't get the significance of that graph, as you make clear in that reply. Your tactics remind me of those who deny the existence of Anthropogenic Climate Change.
Positive_Phototaxis,
A few further questions based on your response; so are you asserting that there is no analytical method that would constrain the size of the resource?
Do you believe that the reserve growth is sufficient to offset the present rates of oil consumption?
In your opinion, is the production rate/price relationship of the past four years providing any "information" about the state of global reserves?
Thanks.
Not "any" finite resource, but certainly for oil. The amount in existance that we know about (ignoring how recoverable) has gone up for many decades.
The amount "we" "know" about "existing" shrinks.
For oil stops being oil once it is converted by chemical reaction into something else.
Or are you unaware of such a fact?
Two stories back-to-back on the 6.30 news the other night:
The first story concluded with a Chinese realtor looking to buy a second Rolls Royce (something), worth $1.2m. He has twenty other cars.
The second story, at the food lines in Haiti, showed several young women - perhaps my daughter's age, which was all the more distressing - caught up in razor-wire as the crowd surged.
If these examples aren't limits in themselves, how much further can we go?
Regards, Matt B
Concerned father-of-three
Haiti is in it's death throws. There are 9 million people on their denuded half of the island. Any help will only increase the number suffering since it will increase population.
It is a problem of culture and ignorance. The only solution for Haiti is the die off of population to a level the remaining resources can support.
The suffering and misery of the process will be horrendous.
It is so awful no one wants to talk about it. There is no acceptable solution. We are like deer who when one of their number is shot are at first startled, then run away as fast as they can and in an hour or so are grazing happily as though nothing happened.
Culture and ignorance?
As I've heard it, we underpriced their farmers with our rice exports for decades(?) and essentially destroyed their farmers. Now that the rice is getting expensive and scarce they have no local agricultural base to return to. (And probably a much larger population.) But that's all their fault?
X;
The US has interfered in the Politics of Haiti so regularly and consistently against any pro-social and democratic developments there that they have had no chance to allow their country to regrow or even survive. It's like we took the Ireland Famine model and perfected it.
Yes, it's a problem of Culture and Ignorance. You just have to clarify whose culture you're talking about.
Bob
Yeah. Read Overthrow: America's Century of Regime Change from Hawaii to Iraq
http://www.amazon.com/Overthrow-Americas-Century-Regime-Change/dp/080507...
We have met the enemy and he is U.S.
Reply to Positive_Phototaxis ...
Huh??? If you are going to make an assertion and label it as a fact, provide supporting evidence. That there are problems with the petroleum infrastructure are well documented by people who have expertise in the field:
http://www.simmonsco-intl.com/research.aspx?Type=msspeeches
Let's see some evidence for your 'facts'.
First, I am not an 'Oil Drum Spokesman'. My opinions are my own. Second, I don't think current market disturbances are caused by Peak Oil although high prices are affecting spending. This is my opinion.
Speak for your own standard of living. Mine gets better all the time. As for the overall standard ... it can certainly fend for itself.
If you argue that there is no oil supply problem, then your argument will be for 'Business as usual'. If you choose to weigh different proposals ... and by doing so acknowledge that Peak Oil is a legitimate concern ... the proposals must be equal to the task at hand. The scale of our energy use demands proposals that will carry large numbers. As for your argument that investment in energy sufficiency is a 'taking' is incorrect. Any spending on infrastructure is a capital investment, including spending on conservation. Whether onetype or another type of investment is best ... is part of the ongoing discussion. Even if Peak Oil did not exist at all, the potential demand for additional energy sources requires investment. So does maintainence.
Referring back to the 'standard of living' issue, 'business as usual' will guarantee a decline in the overall standard of living, at least for US citizens. The most sensible short term investment proposal would be for more conservation. It is the simplest and most effective proposal of any ... and it would improve people's standard of living at the same time. Why? Because using less energy would result in people getting more exercise and eating better food, which would affect health.
Finally, to weigh cost/benefits of any energy solution, the 'externalities' ... pollution and water use ... as well as cost of construction, location of facilities, effects on neighbors, etc. ... need to be weighed as well. I cannot speak for other 'Peak Oilers' but people in my neighborhood do not want industrial facilities nearby. Nor do people in other neighborhoods. This includes power stations, refineries, reactors, pipelines, transmission lines, etc. My neighbors aren't 'Peak Oilers' most are conservative Republicans! Same is true in other parts of the country:
http://wyomingrangesportsmen.org/page.php?D=ct_20060803073358
'Energy solutions' that simple move more problems downstream are not solutions at all.
Hmmm ... I guess your TV doesn't get CNN. It looks to me - and the people in the Federal Reserve and the Treasury Department and the central bankers overseas that the credit system has broken down. Then again ... maybe that just some hysterical 'belief' they share ...
http://www.bloomberg.com/apps/news?pid=20601087&sid=a4E2rlrV3taA&refer=home
"The downside risks to growth and the upside risks to inflation are both of significant concern to the Committee."
http://www.federalreserve.gov/newsevents/press/monetary/20080916a.htm
http://www.bloomberg.com/apps/news?pid=20601103&sid=a7qdBFTyKnU4&refer=us
Etc. Etc Etc.
Knowing that resources are finite is a logical assumption. Knowing that peak oil is now is a definate belief, however drawing from the information that we have available is very likely. The 'facts' we rely on in raising concern for the peak oil argument are very little to do with timescale. What matters when considering the timing of peak oil is creating estimates from the data that is avaiable and trying to ascertain the perspective of the source of that information. Whether its in 2, 5 or 50 years doesnt matter as its effect would be profound if we hadnt prepared for it. Personally, i believe that the volatility in the commodity and financial markets are very much to do with the lack of growth in oil supply. I think a lot of people would have problems proving this or even getting facts to back this up. Its just common sense.
Sorry, haven't figured out how to place comments next to others correctly ...
Clearly a reader of long standing who has a 100% grasp of the current situation.
Member for 5 weeks 1 day.
The answer to your questions requires a modicum of education to make sense. That is, there are some basics you need to understand to contextualize that statement. For example, if you do not understand the awesome power of the exponential function, these sorts of statements will never make sense. The very best explanation of the basics I have seen can be found here:
http://www.chrismartenson.com/three_beliefs
That's chapter 1 - watch the chapters one by one at least through 17c, and preferably all the way through. At that point, if you have understood what is being said, Gail's statement will make perfect sense to you, I promise.
mmm...
The problem will be as always whether the transition to a more sustainable society with a more symbiotic relationship with its environment will be smooth or turbulent. Things like the Transitions movement are a start and gaining momentum, but as the Cuban peak oil crisis shows in its 'special period' there is a lot of endemic future shock involved. How a non-socialist/communal individualistic secular society will cope is anyone's guess.
L,
Sid.
"The world (or oil supplies or whatever) has been finite since the beginning. It was finite 100 years ago and 50 years ago and it didn't keep compound growth from occuring... not did the depletion of whale oil (a far more "finite" resourse despite being "renewable") keep the world from shifting to other energy sources and the growth kept coming."
=
"There are a number of people in the congregation who are interested in peak oil issues, but like other places, many who cannot mentally deal with such thoughts."
Positive_Phototaxis, if by shifting to other energy sources you mean nuclear, see the post on "Energy Vision 2050: Part I". This attempts to look at the options; this and the posts reveal many of the problems with all of them. Besides, the real reason for 'compound growth' had been the fractional reserve banking system along with the debt economy, usury and fiat currencies. The growth of money is theoretically unlimited, but it tends to drive resource depletion due to the need to find 'wealth' to pay off the interest on debt. While efficiency and usable work derived from energy have increased (see Robert Ayres paper "Accounting for Growth the role of physical work" - http://www.iea.org/textbase/work/2004/eewp/Ayres-paper1.pdf - that's work as in thermodynamics not manual labour) these efficiencies are also now peaking - the combined cycle power stations are getting close to the maximum of what is theoretically possible in term of thermodynamic efficiency. And ironically increasing efficiency actually tends to increase overall energy consumption - the so called Jevons Paradox ("The Coal Question", 1885).
Also, as Wackernagel and Rees point out in their book "Our Ecological Footprint" (1996), that the then current (1996) demands on the eco-sphere exceeded sustainable carrying capacity by 30%! And their footprint calculations used "considerable underestimates" (ibid: p.90).
Just how many worlds are you planning on using for your compound growth?
I hope you can gain a better understanding of the problems by engaging with debate on TOD and other such forums, and do not be to disheartened by the 'rating' system - its an expression of human nature!
L,
Sid.
Wow.. What church do you go to? I go to a Lutheran church, and I think everyone there believes oil to be like the Holy Spirit - limitless and omnipresent, if only we were to look..
I live in a small town so it is easy to get to meet the various community leaders. I have seen in attendance at meetings regarding peak oil, or spoken to personally, the leaders of baptist, episcopal, methodist, seventh day adventist, and lutheran churches here.
However, I have no idea if these pastors have done anything with this information.
At the congregational level, I think it is difficult for pastors to do much more than approach the issue from the "We need to take care of the earth" perspective. It is difficult to change beliefs about something that newspapers and radios seems to give such an optimistic view on.
In meeting with a handful of thinking church members, some of whom are peak oil aware, pastors can talk more about the issue. Until public media gets more open about the issue, it is difficult for churches (except the most liberal) to take a leadership role on peak oil awareness.
It is a sad commentary on life in the United States of America when people trust the word of profit seeking mass media more than message of hope, peace, and love which Christianity is called to spread. What is even sadder it is the profit seeking right wing media who insist we are a Christian nation.
Jason-
I was in Willits yesterday, and had a game of ping pong with P3.
I see you community as a bright spot of possibilities in a generally bleak world.
However, even with the passion and intention of the people involved, the task seems messy and unsure.
A lot of evangelicals "get" both Peak Oil and climate change. I am a conservative evangelical, but as I have become more aware of the policies of the Bush administration and the Republicans over the last few years, and as I have compared them to what the Bible says, I have seen that the two most definitely do not match. I quit the Republican party a while back. I have also divorced myself from the Religious Right whose message seems to be that God has promised to keep America strong and rich, regardless of the consequences to everyone else and regardless of the means we use to secure those riches. Evidently these people forgot to read the verse that says that the love of money is the root of all the evils.
I am glad to see matters of faith being discussed at last in a spirit of mutual respect, without polemics. This reminds me of a benefit concert I attended this weekend for a nonprofit group that picks fruit from homeowners' trees in order to donate it to a food bank. At the concert, I talked with a person from a completely different religious background as we both discussed how we had found ourselves coming to the same place regarding climate change, Peak Oil, and our present government. It was an enjoyable conversation.
Jason, I just want to mention that I enjoy hearing your "Reality Report" podcasts. You sort of remind me of what Jackson Browne might be like if he had a scientific education - combining a strong technical grasp of present issues with a strong understanding of their human impacts. Keep up the good work.
There is a fair amount of difference from congregation to congregation in belief. Within congregations, there are differences, too. I know there are a lot of folks with the "God will take care of us" belief, but it is as easy to get this view from the television as anywhere else. Where ever you have educated people who want to read about issues for themselves, you will find some people who concerned about peak oil.
Regarding peak oil knowledge at my church, one thing that may make a difference is the fact that I have been talking about it. There are quite a few members of the congregation who are interested in the issue, and concerned about it.
My Luthern Church is the of the same progressive ilk. In fact every Lutheran church I've attended is all "God is love... Love is a bird... Grace...Peace..."
My pastor, in the rural tallgrass prairie, is alway picking hymns and passages about pastures, wheat, lost lambs, all agricultural images. When I asked him if he did that on purpose-- he gave a big grin and said "yes." For me Christianity is about agricultural metaphors as we moved from hunters/gatherers. Out here our religion fits with our hands in the soil and bringing in the sheaves.
Sowing in the morning, sowing seeds of kindness,
Sowing in the noontide and the dewy eve;
Waiting for the harvest, and the time of reaping,
We shall come rejoicing, bringing in the sheaves.
(Knowel Shaw 1874)
Wow! I know what church you belong to: The church of Peak Oil Armageddon, of which Gail is surely one of the major apostles. For the record, one can believe that the supply of oil is finite and soon to peak without the world coming to an end. Gail also seems to know/suggest financial Armageddon is right around the corner, too.
I think this editorial from Investors Business Daily might help put things in perspective:
http://www.ibdeditorials.com/IBDArticles.aspx?id=306370630265658
I would take issue with the item's rosy outlook, but the following is quite correct:
Ya know, puhkawn, we've been reading these "it's gonna be okay" commentaries for a while now. Since before Bear Stearns; since before Fannie & Freddie; since before Lehman. Each time one of these venerable institutions goes down we hear that the US financial system is fundamentally sound and that this too shall pass.
Well, sir, indeed it shall. After all, all things must pass. What we don't know is what will be left in the wake. You don't know. I don't know. Gail doesn't know. But right now, it isn't looking too good. And until I see a turn-around -- and I will know that when I see bankruptcies and foreclosures on the wane -- I'm with Gail and the rest of the pessimists.
The meek shall inherit the earth.....
after everyone else is finished with it!
DD
Umm...you can add AIG to the above list tonight.
Well certainly you can believe that. And likewise you can believe the "appeal to authority" in IBD article. But you could easily be wrong too.
You accuse Gail of being an apostle in the Church of Peak Oil Armageddon, but you seem to be an alter boy in the Universal Church of Economic Pollyannas. :-)
I don't think "financial armageddon" is the same as "the end of the world"; as Dmitry Orlov points out, economies collapse much more often than civilizations.
I have a gut feeling we will see things that you would not believe in the next 2-6 weeks.Explain to me why huge curtains were drawn over the white house to prevent those arriving from being seen this night,and why ALL the staffers were run out of this meeting.Something wicked this way comes.
Toga party? ;-)
Why do you assume that your government is a sinister force? Its one of the best institutions for picking up the pieces and starting anew if it realy would go pear shaped.
I'm sorry, but asking me to trust Bush, Cheney, Paulson, Bernanke, and the rest of that crew is asking for a level of faith that I simply do not have.
You, of course, are free to place whatever faith you wish in their benevolent, immaculate, all-wise leadership. *gag*
I liked the Toga Party part.
'Why would we assume this Administration (to put a finer point on it..) is a sinister force?' We're not talking about the broad idea of the institution of American Government here, but the particular characters who've shown exactly how they are simultaneously brutal, inept and uncaring when it comes to having a government that can pick up pieces and fix problems.. besides, they're too busy shattering things and spreading around a bunch of their own pieces.
5 words - economic collapse world war three.
Time to seek your Creator and find TRUTH and righteousness.
In the end, unconditional love will trump everything!
I think we all agree that PO will result in disruptions of the economic system, I don't think that is what we are seeing today.
Unregulated capitalism tends towards boom and bust cycles, and this is simply a bust. It is probably going to be worse than most because free-market fundamentalists have been in charge for too many years and regulations that might have mitigated the severity of the bust have been systematically removed. Capitalism is manic-depressive, government regulation is lithium. Adequate regulation leads to smaller busts at the cost, perhaps, of smaller booms. Those who are adept at profiting from booms and socializing the costs of busts think that is a disaster. The rest of us are better off.
The timing is unfortunate. As we drop off the plateau of production we are in urgent need of massive investments in infrastructure, in building cities where people neither need nor want automobiles, and in replacing our vehicle fleet with vehicles that use less (hopefully zero) petroleum. The resources (money and real) that might have otherwise been available for those grand tasks will be hard to come by.
Perhaps we in the US will finally realize that we don't have the money for both guns and butter, and we need butter. Every empire has fallen, ours is the next one in line.
I hope you don't mind if I steal that quote :)
Unfortunately, it seems to me we're entering a 'depressive' phase at a moment when, in order to adjust to resource constraints, we'd be better off being 'manic'.
We have too many simultaneous crisis at the same time, and I think that's going to leave (in particular, American) society far worse off than if we were trying to respond only to peak oil.
We don't have the capital to pursue the alternatives that might help us mitigate the worst impacts in the US.
Manic-depressive... bang on! Curiously, it appears to be able to be both at the same time. High leveraging in oil, coupled with mortgages tanking results in a mad dash for liquidity to cover positions. Then as the dominoes fall, traders dump equities and rush back to oil, pumping it back up near $100. Maybe that's not manic behaviour, just panic behaviour.
My firm prediction on oil is that it will either climb further tomorrow, or plummet back down, or it will stay the same.
Another lurker here, posting for the first time.
I should say up front that I take peak oil and its potential consequences very seriously. There will definitely be hardship, lots of it, as the world is weaned off its fossil fuel diet. The next 20-30 years will be the most momentous in world history. But I don't necessarily accept that the world will 'power down'. If we can use high-tech industries while we still have terrestrial resources to build a space infrastructure, to harness the resources of the moon, Mars, asteroids and beyond, then cornucopians' dreams of limitless economic growth will be a reality (at least for some people).
But if we allow our reserves of precious metals and minerals to get too low before taking action, then we'll be stuck on this little rock forever, and slowly revert back to the Stone Age. It all depends on what happens in the next 20-30 years.
The resources available to us here on earth are there because geological processes concentrated them to levels at which it was worthwhile to collect and refine them. One dead bodies (such as the moon), those forces that did the concentrating, don't exist.
And even without that, where do you get the energy for such an enterprise?
I don't think so.
Where do you get that idea? The asteroid belt was formed from the dissolution of geological bodies very similar to the Earth. They are chock full of iron, zinc, copper and other vital minerals which can be refined easily and precisely in zero-gravity conditions:
http://news.bbc.co.uk/2/hi/science/nature/401227.stm
Where does the energy come from? Solar power. In space you can build power sats that are literally hundreds of kilometers across, that get constant, unfiltered sunlight all day every day. Space is also a pretty safe place for nuclear fission, and if we develop nuclear fusion (which I consider likely) we will have all the power we will every need. But even without it using technology available now we can power a space industry, and it would profitable beyond anyone's wildest dreams.
Where do you get that idea?
Geology books.
You did not pursue your readings far enough:
http://www.abundantplanet.org/files/WoA-chapter02-2008-02-03.pdf
WoA-chapter02-2008-02-03.pdf
This is not a matter of guesswork, but based on analysis of the abundance of elements in meteorites and comparison with the spectral analysis of the distribution of asteroid types.
Exactly. Quoting from the same website:
"For the first time, we can now imagine, design, and construct the tools and systems that will allow us to move from our current, limited terrestrial resource base to an ever expanding, extraterrestrial resource base.
This unprecedented paradigm shift in industrial processes will enable hitherto unattainable levels of well being for human communities on Earth as well as the emergence of new economies and ecologies off planet."
Science fiction? No. This is the product of decades of space research. What we lack is the political will and long-term vision to devote resources to this undertaking.
I disagree. Indeed, this is more or less what led me to peak oil. The problem isn't lack of will. It's that the difficulty is several quantum leaps beyond what we have previously achieved.
If you watch 1960s science fiction, a lot of it predicted that we'd be colonizing solar systems, or at least other planets, by the 1990s. It made sense. Thirty years after the Wright Brothers' first flight, we had PanAm.
But thirty years after Neil Armstrong walked on the moon...we still hadn't gone back. Why is progress slowing down? Could there really be an "end to science"?
I think there is. And Tainter has the reason. The low-hanging fruit is picked first. Most of the great work of science was done years, even centuries ago. Many of the greatest contributions to science were made by people without formal training. But the day is past when monks growing peas or people flying kites in the rain can make significant contributions to science. The general knowledge, which provided the greatest benefits, is already known. The specialist knowledge remaining to be discovered requires expensive education and equipment, for relatively little return.
Is there still useful knowledge to be discovered? Sure. But it will require ever more resources, and yield ever lower benefits. With energy becoming more expensive, it's not a path we can easily pursue, and we certainly can't keep it up forever.
I can't see the point of the prediction business, save in the most narrow sense, like it is apparent that we are running out of inexpensive oil.
It is clear that there are ample energy resources for us which we either have the technology for or can reasonably expect to develop if things don't collapse too badly.
It is also clear that some mineral resources and environmental resources are much more doubtful.
Whether we can get the social, political and financial environment right to master them is the biggest question, and that is what we are about to find out.
None of us know enough to precisely predict that - there are too many black, white, grey and parti-coloured swans flapping about for any human being to be able to reach an authoritative assessment, and relies as much on happanstance as reason - if John McCain falls asleep and his head hits the big red button we will all have a radically different future to if he doesn't, and conversely if the Bussard fusion reactor works then circumstances change again.
We may have our individual feelings for what seems to us probable, but we don't actually know.
That's life, and the condition under which we live it.
The way I see it...the fact that we can't know for sure is reason to be more worried, not less.
Not to me it isn't. Possible? Yes. But I wouldn't want to bet on it.
I can live with uncertainty.
If it were clear that, for instance, solar incidence was too low to support a civilisation using electricity, or we had no idea how to tap it, our circumstances would be far worse.
There are a lot of resources out there, whether we will manage to tap them is the question.
That is a far better position to be in than if they did not exist - that is when it gets worrying!
Actually, I think it's pretty clear that it is. All the previous civilizations we know of were solar powered, but not electric, which strongly suggests to me that it's not possible.
People have a tendency to be overly optimistic, and to think that they're special - the exception. The way around that bias is to look to others' experiences - to history. And as Jim points out, when we look at it that way, we see collapse is quite normal, while solar-electric has never happened.
You've lost me there. In no way did they have the technological base to build solar PV panels, and had not discovered electricity save perhaps as static, so how that the alternative can have been found to be impossible escapes me.
Even more than people having a tendency to be optimistic, they have a tendency to imagine that they can predict or influence the future more than they can, or that their insight is uniquely powerful.
Hence the age-old power of the 'gamblers fallacy', in all it's variants.
Doesn't matter. When the resource base goes, so does the knowledge and technology it supported.
Well, I have no illusions in that regard. I don't believe I can influence the future, and my "insights" are hardly unique.
My comments in no way implied any personal reflection, but pertained to all of us.
The situations of those past societies which never had the technology to produce electricity from solar power and one that has at the moment, and which may or may not lose that technology, are certainly not exactly equivalent, and so your drawing an analogy between them may or may not be appropriate.
Since this is hardly the only debatable issue in the consideration of our future, the chances of getting all of them right is surely negligible.
At some stage in the future, if we pull through, doubtless some rather smug historian will write: 'it was inevitable that...'
Not to us it's not!
As a practical matter of living, I would go along with Henry Ford: 'There are some who say they can, and there are some who say they can't, and they are usually both right!'
Maybe some inevitable doom will run us down, but until it has then it doesn't seem the right play to work on that assumption.
In the first 100 years after Columbus very few Europeans bothered to travel and colonize the Americas. The handful of Spaniards who invaded the Aztecs were nearly 30 years after Columbus. The French were content to establish a few trading posts for nearly a 200 year period after Columbus. The first successful British colony was founded 115 years after Columbus's first voyage. The Revolutionary War happened 285 years after Columbus.
Maybe it was just a coincident that the Apollo flights happened at the same time US peak oil happened, maybe not. We are still at a very early stage in space travel. What we did in the 1960s was extremely difficult and included a good share of good luck on many of the flights. We seem to admire Japanese technical prowess but they have learned just how difficult putting anything into orbit is. Columbus was also very lucky and later travelers learned just how difficult crossing the Atlantic was in what we now consider to be small yachts. I went to sea on an aircraft carrier and I was amazed at how small that ship felt out in a winter storm with 30 foot seas.
Industrial civilization faces a very difficult future over the next several decades but we could have a much better world 50 years from now and with a significantly larger population. It means valuing the well being of our neighbors much more than personal economic profit. The financial problems of the last few years and especially the last few days will work themselves out it we learn to as E.F. Shumacher said, "Take care of the people and the dollars will take care of themselves."
Thomas:
You say: "we could have a much better world 50 years from now and with a significantly larger population"
As much as I like that idea, I just don't see the math of how that is possible. The achievements you chronicle follow greater and greater exploitation of pre-existing deposits of readily usable energy which is largely responsible for the growth we have achieved. I'm not saying that the energy drove the growth, I'm saying that the growth would not have been possible without it. As this resource becomes depleted, things become very difficult.
That is what this site is all about. If you could present some justifications for your optimism, I would love to hear them.
Cheers
I am mostly pessimistic about the future. The world we have today is rooted in war, greed, and avarice. This is especially true about a large portion of the American electorate. We could have had a much better quality of life for most of the world's people but only if financial profit seeking were not our highest value. Earning a profit is not bad if it is done with the goal of providing the necessities of life to as many people as possible. Instead we have a business ethic of beggaring your neighbor and then moving on to beggaring another neighbor while maximizing profits for as few people as possible.
One thing lacking from our value system is a sense of how much is enough. The last few centuries has seen a world in which we have always said basic social services for everyone (food, housing, literacy, access to world markets, health care, etc.) must wait until the rich get a little richer. The world has waited and guess what! The rich aren't rich enough yet. They blame things like corruption in poor nations for keeping their people poor all the while creating and profiting from the very corruption they decry.
Economic growth should no longer be the goal of society but economic development where most of our production is for local consumption ought to be the goal. Economic growth has only widened the gap between the many poor and the few rich. There still can be world markets but not by racing to the bottom in a world of sweatshops and child labor. Solar energy is more than enough by a thousand fold to meet the needs of billions more but by its nature renewables are more labor intensive than fossil fuels and therefore less profitable for the rich. If we wait until the profitability relationship to switch to solar's favor then we will never have solar as more than a very small percentage of the energy market.
In America business as usual will continue as long as politics as usual persists. Politics as usual will persist until enough formerly well off people are feeling enough pain and realize the American Dream is an illusion used to keep them entranced with the possibility of moving higher on the economic pyramid. History has shown that it took the Great Depression to end the robber-baron era and created such programs as Social Security, unemployment insurance, the minimum wage, and genuine collective bargaining rights. They didn't wait for economic growth to make the rich were rich enough to make those changes but made them at a time of relative poverty.
I think you are right about economic development needing to be a goal. Everyone needs to be earning enough to take care of themselves. I don't see how a $5 million salary is of much more benefit than a $100,000 salary.
The depression was 70 -80 years ago. Most people today have forgotten the lessons learned back then.
The world we have today is rooted in war, greed, and avarice.
It has always been.
It is just because of improved communications and inproved military technology that it appears more unbearable.
Previously the worst aspects were entirely hidden thanks to the Survivor's Fallacy (war seems more heroic than it is because only the survivors get to tell war stories).
And this was even good for group selection, propping up the "best performers".
Not anymore beneficial policies for anyone in a closed and fully connected world.
Don't worry, collapse will fix that by loosening the connections ("deglobalizing"), back to local warlordism, Somalia/Afganistan minus imported weapons...
Maybe slow down just a little bit - any major leaving of our terrestrial resource base will involve the harsh reality that right now we have no idea how to deal with solar radiation - a trip to Mars would probably radically alter or destroy up to 25% of a human being's DNA.
These little technical challenges keep coming up - maybe we could overcome them, maybe we couldn't, but it would be more accurate to say that we have the very beginnings of a prototechnology that might or might not enable us to get into space in a much more serious way - and the "might not" is a real possibility. Space is a radically more hostile environment than any place we've been before, the death rate just getting out of orbit is extremely high for both astronauts and support crews - it isn't at all obvious that we can do this. Perhaps we can, perhaps we even should - but I think this kind of understatement of realities doesn't help anyone much.
Sharon
The proposals I've seen for utilising extra-terrestrial resources usually concentrate on the earth-approaching asteroids, and utilise mainly or entirely robots.
The Mars proposals are much more a 'to boldly go where no man...' type of deal.
If we manage to survive as a technological civilisation it appears that we should be able to manage the robotics, and the materials lifts would be quite manageable if the object was just to mine precious rare minerals - they would be roughly processed on site and returned by a low-powered rocket over months or years, and parachuted down.
Judging by our present financial condition and technological impasse over energy and more particularly oil, it doesn't seem likely that we will be able to attempt anything anytime in the foreseeable future though.
I would partially disagree here.
I think that managing to mine asteroids is within our current technological capabilities, or within what we could develop with existing knowledge in a relatively short period of time.
The problem is that it would be immensely expensive. It would make the cost of the Apollo program, or even the current military budget of the US, look trivial.
We've spent ourselves into bankruptcy, and even if we had the political will, I don't think the capital exists for this type of effort.
Michael
Ooooooh!
What a party!
I've been away for so long, beside the "odographes" the singularitarian cretins are back too.
You might be correct but here is the trade-off: A relative handful of wealthy, highly skilled people will have the chance to escape while the vast majority -- presumably the "meek" of which the good book speaks -- get to inherit the slag piles left by those who took off to the stars.
Yes, unfortunately this has been the case throughout history: the allocation of resources has always been very unequal. I acknowledged as much in my first comment. I was merely countering the suggestion that it is 'inevitable' that we will all be stuck on this planet forever and revert to the stone age as resources give out on Earth. There are always winners and losers. Still, one can hope/dream that with a practically infinite pie of resources from space there will be even more to trickle down.
It probably isn't inevitable physically/thermodynamically. However, I'm afraid it's approaching inevitability in an 'evolutionary' sense. (Here I'm using 'evolution' in a broad-brush way which includes not just our genetic tendencies but the path-dependent evolution of current human cultures and economies).
The amount of money and intrest being put into space exploration now is feeble compared to the days of the moon race. We couldn't build and launch a Saturn V now if we wanted to; that nexus of complexity is irreversibly gone. The "new" launch systems seem to be largely kludges based on space-shuttle parts.
At this point, the odds of ever landing a human on Mars are looking pretty remote. Colonize the asteroids? With what excess energy? What funding? The time to payback could be a hundred years easily - who plans that long-term? I think at this point we'd need a space-obsessed superpower dictatorship to see it even attempted.
Am I anti-tech? No, I cut my teeth on SciFi, spent a number of years pressing to expand man into space, have personally interacted - if briefly - with O'Neill, von Braun, and Bussard in that quest, and am dejected that we've blown our chance. But I think we have blown our chance, if we had one. On some levels I regret having lived long enough to realize it.
I'm afraid that "trickle down" from space will continue to mean what it did for the dinosaurs.
That pretty accurately describes my attitudes too.
The technology sounds possible, but the political and financial situation threatening.
I would not rate our chances of pulling through highly.
But OTOH, what do I know?
30 years ago I thought it very unlikely that we would screw up as badly as we have, so perhaps I will be wrong again in the other direction.
No one is going to the stars. It can't be done with a gasoline powered engine or any variant of the gasoline powered engine. The gasoline will, for all purposes, be gone, likely within a generation, and then what? Without oil as our base resource for our civilization we won't be coming up with hyerblaster drives for rocket engines. It just isn't going to happen. I do believe space travel is possible, but our civilization took a wrong turn with fossil fuels. We've had our hundred and fifty years of technology development and, it'll soon be over. So Sorry Dr. Spock. Best from the Fremont
It's technologically possible for us to go to space in a big way.
It isn't politically feasible.
Therefore, not going to happen.
Thanks Gail. I only wish we had churches with Peak Aware members (or any groups) like yours in my area.
I worry about the teens coming of age in this mess. They were raised in our Culture of Discontent of the past 40 years, fully indoctrinated to Consume 'Till You Drop.
It is a very rude and painfull awakening for them. Trying to teach them to cope, and even enjoy simplicity, will be difficult.
Regarding churches with peak oil aware members, I would look at the more liberal end of the religious spectrum --Lutheran, Episcopalian, Unitarian. But as Jason Bradford mentioned, the peak oil aware can be of any religious denomination.
I think parents play a big role in the "consume until you drop" society. If kids see that parents are drop-outs from this philosophy, they are more likely to be drop-outs themselves. Our kids figured out many years ago that the reason that we didn't have as expensive a home as many of their friends' parents was because we didn't want one; not that we couldn't afford one. Our TV was off nearly all the time, except during Atlanta Braves games. Now we don't even have one, except in the basement, to look at when there are tornado alerts and when occasional programs are on that we might be interested in. We will lose the TV when broadcasts go digital, unless we decide to make an upgrade.
Could not agree more. Kids are more sensitive than we give them credit for. If the only thing we teach them is to consume they will do that. But they can also be shown that there are more interesting things to do than shop at a mall till kingdom come. And they will be the better for it.
I make it a point to take them once in 3 months to the nearby rural areas and show them how hard a farmer in rural India has to struggle to keep body and soul together. And that people have to walk 1-2 km just to fetch one pot of water.
When we lived in Singapore, we did not own a car. Life was fine without it. The kids' day out would be on the upper deck of a double decker bus.
Parents have to set a good example. Children do what you do and not what you say you do.
Srivathsa
I agree with both you and Srivathsa - it's up to us as parents to do the best we can to teach them, by example.
The hardest part is having to raise teens in this culture - where virtually everyone else around them continues to live the lie. Worse yet, many if not most of their friends and other relatives seem to do their best to undermine parental efforts, rediculing the way you live and the values you are trying to instill (some get very hostile).
The kids get confused and begin to resent the parents... oh the joys of parenthood ;)
It's a battle, but it is worth it.
As for churches, I'm athiest, but I know some nice Quaker families that I can get along with and who share most of my values.
I know some of the members of the Atlanta peak oil group are members of a Quaker (Friends) church (if that is the right term). We had one meeting in their building.
Quaker Jargon:
Most Friends would refer to the building in which they gather on Sunday as a "Meeting House".
The "Congregation" is referred to as "The Meeting", which is comprised of "Members" (those who are documented members of The Meeting, and "Attenders" (those who come regularly but have not yet sought membership).
You may hear some more traditional Friends refer to Sunday as "First Day" (Monday is "Second Day") and so on, likewise "January" would be "First Month" and so on. This is a way of not referring to the "Pagan" Gods after whom these days and months are named in English. This form of speech is becoming archaic nowadays, though you will still see it used in written minutes of meetings etc.
A number of my friends emigrated to the US from India many years back in search of the Great American Dream.
I visited the US the first time almost exactly 6 years back on work. This was to Cincinnatti. While there I visited one of these very friends who was living then in Saginaw, MI. He had, I belive, pretty much made the Dream - a nice big house in a district (if I remember the term correctly), 2 cars, etc etc. (I found Michigan in September easily one of the most beautiful places I have seen). However what struck me was the sheer emptiness in his life. It was pretty much all about the perfect lawn in front of the picture postcard house. That was true of most people there. Only one question came to my head "And what after this?".
I also had the chance to settle down in Singapore, having lived 6 years there. But the longer I lived, the more I felt as though I was living in one large corporate campus. That thought alone struck terror in my heart. (If you ever think that the US is consumerist, you must visit Singapore). There was no discomfort of any sort. Things were almost perfect. I somehow felt that only corpses live like that. And so I came back to India to all the problems that one can find on earth :).
I am atheist too. I turned away from organized religion many years back. I found it the root cause of too many problems (with no disrespect to others who want to be part of it).
Srivathsa
Did your friend tell you his life was empty or was that your interpretation?
Most people will take the emptiness of a picture perfect house with a perfect lawn any day any time over the "fullness" of load shedding, water shortages, bad quality water with E. coli, extreme congestion & pollution, communal riots & bomb blasts, constant threat of life threatening infectious diseases, rampant medical malpractice, fake/substandard drugs sold in pharmacies, complete absence of hygiene & sanitation, bad infrastructure, etc.
But I guess, to each his own.
My interpretation of course. I would go nuts living in a perfect environment.
Well life is not as bad as that in India. I was having another discussion in another forum that we the better off Indians are like parasites. We want everything laid out neatly for us and if something is not quite to our liking, we move to greener pastures.
Suggest you read a book called "Escape from Freedom" by Erich Fromm
Srivathsa
Then you are different from most people. I am not challenging your preferences, but I think it is ridiculous to say that someone's life is empty because they live in a nice house with a nice lawn or people in Singapore live like corpses just because they live in an affluent society. By the way, we lived in Singapore (Holland Village) for over a year in 1993-1994. I didn't like it either; but for different reasons. I had moved there after 7 years in the US. By then, I was used to lots of space, cheap housing, freedom and convenience of having a car. In Singapore I was paying 30% of my salary in rent every month to live in a small, crappy apartment and it took nearly an hour to get to work in a bus (office was just 5 or 6 km away).
I agree; if you have money you can insulate yourself from some of these problems.
People have always moved from less affluent to more affluent parts of the world. Nothing unique about Indians.
Of course - we can agree to disagree.
I lived just off Orchard Road behind Paragon. I was an expat here. Housing paid for, kids international schooling paid for. I really mean it when I said that I got tired of living in a perfect enviroment and without discomfort. I did not want my kids to ever grow up thinking this was "normal" life and that these things were entitlements.
I also went back because my parents are growing old and I could not for the life of me let them be alone in this stage of their lives.
Thanks for sharing your observations.
Whether or not you are an atheist, somehow society needs a way of transmitting its values to people. Families can do this on their own, but it is easier if churches are part of the picture also. A church also fills a social function--a place to meet people, and do things together, without going out drinking alcohol. (There are sometimes wine and cheese functions at churches, however.)
I think what happens in the absence of churches and families with a strong sense of wanting to transmit their values is that organizations who speak loudly transmit their values. People don't realize that these organizations are playing exactly the same role as religion has in the past, and, in effect, becoming a new religion. These include:
(1) Television - buy our product; he who has the most toys wins; the goal of life is to be entertained
(2) Economists and financial planners - growth is great; you don't need family or friends, all you need is a good investment counselor; free markets will solve all our problems
(3) Government - everything is getting better and better; we will take care of your every need; don't worry, be happy
People don't realize that what is being presented as "fact" is in fact a philosophy that someone else thinks as right. It very often is not. I think if churches pass on reasonable set of values, they can be worthwhile, whether or not the religious message being taught in them happens to be true.
Gail,
Really a great post, trolls notwithstanding :-).
I agree with your points, but I think it is important, (so we don't all go nuts) to understand that religion, along with media, government et al can all have serious detrimental effects. On the flip side, I don't think that there is anything intrinsically wrong with any of them.
Demonizing them, while very tempting, puts us in a victim mindset, which impedes our growth.
The danger, and damage comes from how they are implemented and how we react to them. The above, and many other influences provide a narrative that we can use in our daily lives, but it is up to us to take responsibility for the narrative we adopt, rather than say "well, that's what they told me to do".
Considering that personal responsibility is an anathema for consumerism, and has been vigorously rooted out, we will need some serious realignment to achieve balance. Some of us will get there, many will not.
This is two recent reports relating to the AIG situation:
AIG Down Again Amid Cash Crisis
Merrill's AIG Problem
The bankruptcy of AIG would be a huge problem. I'm not sure what is keeping the market up today--perhaps the Fed meeting today, and some PPT operations. Maybe there is belief that AIG can get through this mess.
AIG was deeply involved in insuring mortgage bonds and in issuing CDSs. These are precisely the things I warned at the beginning of the year would get companies into trouble.
Denninger has a lot to say about AIG, none of it good:
Ready For The Giant Kaboom?
As for how it's affecting me personally...it's not. At least, not yet. The drop in the stock market is no doubt affecting my mutual fund and Roth IRA, but we've seen worse. A lot worse.
My credit limits have not been lowered. Quite the opposite. I just got another credit card offer yesterday - 0% interest for the first 12 months, no annual fee, no balance transfer fees, pre-approved for $16,000.
And everyone I know (aside from fellow peak oilers) is completely oblivious. They are unaware of the financial turmoil. When I talk to people, there's no mention of Lehman or Merrill or AIG, and incomprehension if I mention it. They're concerned about football, Ike, gas prices, Sarah Palin, that new Coen brothers movie, etc. Even New Yorkers are far more upset about the Yankees not making the postseason than about anything going on on Wall St.
AIG is, and has been, run by cockroaches, the king cockroach being Hank Greenberg who was forced out three years ago. All insurance brokers and claim representatives I have talked with have nothing but disdain for AIG. I have had numerous auto claims against drivers insured by AIG; all were unpleasant and in sharp contrast to the dozens of other auto claims I've had with other insurance companies. (I have 80 vehicles in my company.) If any company has to go down, it should be AIG. They represent everything that is wrong in the insurance industry.
It takes little effort to search for examples of AIG's unethical/illegal business practices.
http://www.businessweek.com/magazine/content/06_13/b3977081.htm
http://nymag.com/nymetro/news/bizfinance/biz/features/10348/index2.html
http://www.msnbc.msn.com/id/7994428/
AIG is known for its opaque financial reports--even reports required by insurance department. Since they have international operations, they probably have a little more flexibility than most on how they can report things.
AIG has always been a go-go operation. In years past, their price earnings ratios were higher than those of other insurance groups. Hank Greenberg had a plan for the company, and it involved expansion in the areas he felt had the most potential for growth. Of course, these area were also the riskiest.
It seems like AIG sent fewer actuaries to actuarial conventions than most companies, and was less involved with actuarial organization affairs than one might expect of a company its size. The impression one got was that they had things figured out--they didn't need actuarial organizations.
Cripes and we're going to bail these greedy leeches out?
I want to see some indictments.
Try Denninger right now at 18:46 and run for cover. A video too!
This is a good summary of the AIG situation from Barrons, pointing out that pro-forma tangible book value of AIG is expected to be $3 to $4 a share, and that they are paying 850 basis points over LIBOR (equivalent to 11.3% interest rate. It sounds from the write-up that quite a bit of the AIG business may be sold.
Giddaye Leanan,
"And everyone I know... is completely oblivious". As do I. And STILL I wait for them all to become aware - best I can do is prod a little here and there. What other option is available? What's the point in going it alone (in my immediate circle)? Surely there must be someone out there with contacts at the "Britney Spears/wonder-bra" TV stations?
Train wrecks, Hurricanes, Economic Crashes, Fuel Shortages - they all have to HIT before they're reported. Frustrating.
Regards, Matt B
Now walking in a trance half the time.
I read that the de-regulation of much of the financial "industry", re-writing of accounting and periodic reporting guidelines so that unpleasant facts can be excluded from exposition, and using the same assets over and over as collateral have been championed mostly by the Conservative Republican party. How, via any conceivable contortions can such shenanigans be considered conservative? It sounds pretty irresponsibly reckless to me.
I understand that in Europe, Liberals correspond to what you and I would say is conservative in this country. This view is expressed in the wikipedia definition of Liberalism:
*"Liberalism* refers to a broad array of related ideas and theories of government that consider individual liberty to be the most important political goal."
Also, it seems like the views of the Republicans have changed over the years. At one point, perhaps they really were conservative.
Well actually its something of a disingenuous comment on my part. I'm just amazed at how the Rush Limbaugh types created something called a Liberal, gave it the attributes of someone who wishes to give away all your earnings to wastrels and otherwise fritter away the substance of the nation and then repeated that hourly till the faithful were fully trained . The Liberal figment is so well developed that all the "Conservatives" have to do is say the word liberal and start the dogs barking.
You can see how really "conservative" the Republican party is by the treatment they gave Ron Paul - a man who has never voted for a tax increase, never voted for an increase in government, and who always returns part of his salary and annual congressional budget. They treated him like a pariah. So the Republican party is really something else. What is it? It's the other side of the Democrats - both of which are outlets for corporate money and power. The only differences are in what corporations they represent and whose views they push.
And you are correct. Many people really want a true conservative (small government) party. The Republicans come along and masquerade as one, scapegoating the Democrats as "big spending liberals" while earmark spending under Republicans has exploded. But the real reason this works is because the voting public lets it work. They let themselves be taken in by liars like Limbaugh, O'Hannity, and others who use the words and phrases of small government while doing the exact opposite. And of course the Democrats represent no real other choice here, just a difference of which corporations get government handouts, tax breaks, and how heavily taxed the average working person will be.
The Democrats and Republicans are two sides of the same corporate coin. Until people really learn that and respond to that, things will not change for the better.
Well said, Greyzone. But as US elections have now been sold to the corporatocracy - and I mean that both figuratively and literally - the game is over, and 'better' isn't coming our way... until, perhaps, after the current system collapses completely.
Gail, it's computer model hedge trading, which has kept all markets looking incomprehensible for years. Everything is hedged six ways to Sunday. This doesn't allow the stock markets to move very much, or when they do, they slam back the opposite direction. It's like ping-pong longs & shorts and make your money on the spreads.
Intresting theory and its refreshingly free of conspiracy theories. Wonder if it breaks down as questionable financial instruments are flushed out of the system?
Everything was computer model hedged yesterday, too. Yet the market managed to fall just fine.
Which "this" are you talking about?
- a) "a time when oil was in abundance"
- b) "conveniences that people...wouldn't even have dreamed of"
- c) Both (a) and (b)
We know that (a) must come to an end, as the quantity of oil is finite. (a) does not immediately imply (b), though, so it's not at all clear that it's reasonable to say we know that (b) must come to an end.
It's very common to leap from "oil is important for society" + "oil is vanishing" to "society is vanishing", but it's not a valid deduction. (It's potentially a reasonable induction, but inductions are only as strong as the evidence supporting them.)
agree 100%
I also agree in this sense: that's the next big debate -- is there a way out? Does PO mean that our present way of life is no longer sustainable or is there some combination of other sources that will allow us to continue?
Myself, I'm well convinced that no combination of all other resources can come anywhere near allowing us to continue as is -- i.e. radical retrenchment is unavoidable. I won't argue it here, but a look at the population and resource consumption graph for the last several hundred years gives you a strong hint that things cannot go on like they are much longer.
I would love to see this debate developed with facts and figures here at TOD. PO is more or less established. This is the next big issue.
Nothing can support exponential population growth
However there is quite a bit of evidence that exponential population growth is already slowing and will peak at around 10 billion in 2075.
So in some ways, the exponential growth argument has already been debunked, evidence indicates that past exponential growth is not a predictor of future exponential growth
http://www.un.org/esa/population/publications/longrange2/WorldPop2300fin...
Given a static or slightly declining population, being able to maintain or even improve on the current standard of living becomes potentially feasible, as long as we find a solid source of energy.
Given a static or slightly declining population, being able to maintain or even improve on the current standard of living becomes potentially feasible, as long as we find a solid source of energy.
We're not there on population. And we need minerals and metals beside energy, some of which are also being depleted. And we need to do all this without worsening, nay while lessening the greenhouse gas emissions. And of course it is not 6.7 billion that are whooping it up, but perhaps 1 or 1.5 billion. The rest cannot hope to live the way we have. Nor can we. Improve in some ways, yes, but not anything like the way we live now. So so even if the big IF (energy) were to (miraculously) turn out ok, there's very little or no hope for continuing as we are.
You have listed the downside
The upside is exponentially increasing technological development.
However I agree there is no sure thing, and I do firmly expect a person of declining standard of living, a long emergency if you will.
I expect that period to be of finite duration, and to be followed by a new, probably better managed, uptick.
Also, there is i think a difference between "living the way we live now" and "declining standard of living". In many ways we are wasteful and stupid in ways that do not really contribute meaningfully to our standard of living.
Can you guarantee that technology can increase exponentially for the foreseeable future? Proof please, or take your assertion and shove it where you are shoving other people's assertions.
of course not, no one can guarantee anything about the future. However it seems reasonable to believe that a ten thousand year trend will continue unless someone provides evidence to the contrary? Burden of proof and all that.
By the way, the reason why the planet the overpopulation problem is being solved in the first world is a technological fix....
Over the last ten thousand years there has NOT been a steady exponential increase in technology. In fact, technology and science have been lost at various points. This is the entire point of bringing writers like Tainter into the discussion.
P.S. I really strongly suggest you get a bit more acquainted with anthropology. There are invaluable lessons there, especially for a technological civilization. As Tainter notes, such civilizations are not doomed to collapse, but they are doomed to change, either via increases in complexity (reasonably common in history), voluntary decreases in complexity (extremely rare in history), or involuntary decreases in complexity (extremely common in history). Those are the only three outcomes possible when a civilization learns that its mode of operation must change, frequently due to environmental limitations, including resource constraints. And the question is not can we change, because we obviously can, but rather, the question is will we change? And that's a bit different from can we change. Rome could have changed but did not, resulting in Rome going from a metropolis of 1,000,000 people to under 30,000 people in just a few centuries.
I have always accepted the premise that we have the technology to solve our problems. Of more concern to me is whether we have the political willpower to actually make the changes to our lifestyles necessary to allow adoption of newer energy sources or not. And the assumption that we will because we must is not borne out by history.
Thank you for the constructive feedback, I will make sure to get "better acquainted with my anthropology" so that I may achieve the level of enlightenment you are demonstrating on that subject. I am sure after doing so we will agree on all things. May I call you "master"? (-:
Now, proceeding to criticize the argument and not the person....
Since the advent of agriculture, individual areas, nations, regions, have gone through periods of decline. Humanity, as a whole, has not.
Also, even if what you say is true, which it isn't, the two statements
and
are in no way contradictory. You are confusing fitting a function with an entirely smooth function, which is not the same thing at all
I think you will be hard pressed to find a significant examples of technology being lost in it's entirety, across the planet.
Can you provide such an example?
The main technological base for most of human history has been a broad band of civilization stretching from China to Britain. At any given time, areas of that base were rising or falling but the entire base, as a whole, has been experiencing exponential growth.
Even the decline and fall of Rome, which is probably one of the most significant periods of regional collapse, failed to wipe out any technological advancements of significance, as most of those advances had long ago spread East. The so called medieval dark ages were in most ways more advanced technologically then Rome.
The thing is, we cannot obsess over one set of exponential functions (population growth and it's associated resource problems) and completely ignore and hand wave away another exponential function (technology growth) especially given that past history has shown that, overall, over the long term, the technology growth trumps the resource problems.
Previously, individual regions have reached resource limits often causing collapse. Never before have we reached global resource limits and we may be approaching those limits now. To glibly assert that technology can trump resource depletion, when technology itself is dependent on those same resources, is circular reasoning, fit for an economist, not a real scientist.
It remains to be seen whether technology will trump resource limits, or vice versa. However, either outcome is within the realm of possibility, neither is fore-ordained, and none of us know which way the dice will land.
Honestly, I imagine we have faced exactly this type of challenge several times as a species and will face it many more times in the future.
Ignoring the potential impact of technological advances is just as myopic as ignoring the peak oil problem itself.
It is still anyone's ballgame, this is the great challenge of our time and our generation and I for one and not going to crawl off into some pastoral-Utopian fantasy hole and give up without a struggle.
We used technology to dig us into this mess we shall see if we can use technology to dig us out.
The only other real alternative is a mass collapse and die off, which hardly seems like a good plan.
Concrete
Touché
Plumbing, ceramics, aqueducts, roads, togas;)
None of those were lost
Chinese were pretty much ahead of the romans in most of those anyway...
You are spot on in one regard:
"I think you will be hard pressed to find a significant examples of technology being lost in it's entirety, across the planet."
If it has been lost in it's entirety, then yes, I would indeed be hard pressed to find it.
also agree 100%
I see this as basically a straw-man argument. I have read many careful, detailed analyses of how the decline of fossil fuels might very well lead to the decline of the kind of civilized society we in the 'Western World' have become accustomed to. In fact Gail has provided such analyses herself.
The key word is "might"
That is certainly one way things can play out, but by no means the only way
I think you have your answer in the Democrats latest energy bill. No drilling but they appropriated ten million for bicycles.
You'll look sweet, upon the seat . . . of a bicycle built for two.
While one may not need to be totally focused on acquiring wealth, one was not supposed to "cast one's pearls to the swine" either. In the parable of the virgins, some had oil for their lamps before going to the wedding feast, others did not prepare and were without oil. The virgins counted as wise were the ones who had oil. While one was asked to try to help the poor and the weak, one was usually not asked to give everthing. A rich young ruler was asked to forsake all his wealth, yet a simple fisherman was asked to go fishing once again, and this he did to pull in a great catch. Everyone has different callings. If one stores up wealth, one should be mindful to designate trustworthy heirs.
Benjamin Franklin said, "A penny saved is a penny earned." Those who saved and lent out often found great buying opportunities in times of trouble and panic selling. Those who have maxed out their debt limits might see banks reducing credit limits and no opportunities to purchase true bargains.
Diligence might produce more. One plowing was urged to keep going and not look back. This created more wealth as a seed of wheat might yield 40 times what was sown.
I think it is a matter of priorities. Obviously a person needs food and shelter, and some clothes wouldn't hut either. But when ones' over-arching goal as more of everything, and "he who dies with the most toys wins", there is something wrong.
Gail, thank you for this thread.
I was very fortunate to be able to retire in my early fifties and not be dependent upon the "financial services industry". I moved to a locale in this foreign country where life is easy, the cost of living is low, food is locally grown in a rich soil with perfect year-round climate, people are friendly and helpful...and the value of my home is still going up!
I realized early on that life is too short to worry about material things. "Do what you love and the money will follow" as someone once said has been my life philosophy. "Simplify, simplify, simplify" are three other great words of wisdom.
I reacted to what I saw as the coming meltdown some years ago...and left the United States. This is not an option for most people, but I would highly recommend that those who are capable give it some immediate consideration. There are many nice places in the world where life is still as blessed as it once was and should be.
If you go with this option, just be careful to pick a place with not too much in the way of oil, NG or other needed minerals.
Gail,
I pretty much agree with you on the personal side. But I think that if we remain at that level, we remain on the defensive and will face hardships that go far beyond what PO and its consequences alone will force on us.
Much as we are addicted to stuff, portfolios, keeping up with or ahead of the Joneses, the addictions of our gov't and the elite that controls it are far, far worse. (The addictions all boil down to one, we all know that.) And those addictions are what will impede making the changes to our way of life that are needed to assure that everyone is able to eat, have a place to sleep, and get at least a minimum of medical care. In other words, we MUST, no matter how much we detest politics, get political. We have to start thinking about building a movement that will allow us to put human needs above profit when it is necessary to do so. We need to start demanding that our gov't stop squandering our remaining resources destroying other countries and rechannel that money to making the necessary changes on the homefront. We need to resist all attempts to incite hatred and division among people. We need to get everyone into all the big debates -- learn how to yell and argue with each other and then shake hands at the end and say -- we'll continue tomorrow, do you need anything?
TPTB will not encourage or support self-help groups and will do everything it can to sow enmity. We have to organize to resist that. So we need politics, a politics that rejects hatred and is pragmatic in terms of how to adjust to the new realities. And above all, it must encourage and facilitate peoples involvement in rebuilding their own lives. I won't go over what I think is necessary in that rebuilding except to say that directionally I agree with JHK.
What a fascinating, scary, challenging time to be alive! I still can't make up my mind whether I'm glad to be old or whether I'm sorry to miss some of most interesting times ever to be alive. Well, no matter, I'm not missing it all.
I think you have the right outlook.
As I stated below, it appears we are going to be put to a pretty severe test. Assuming the human race isn't totally wiped out by uncontrollable forces, how we respond will largely depend on us.
The last time the world was severely tested was during the Great Depression. Germany, Italy, Spain and Russia failed that test, turning to the secular mass movements of Nazism and Communism. The United States chose a different path, instead turning to what Frederick Lewis Allen called "the new religions of social salvation." And like you pointed out, the powers that be did everything in their power to stunt those concerns for the common good.
But whatever happens I would agree with your statement: "What a fascinating, scary, challenging time to be alive!"
I think some have more of a gift for the political than others. I don't think I have the right skill-set. Prof. Goose's field is a political science professor.
It seems to me that the way things are aligned today, it would be very difficult to do anything in the political arena. Dmitry Orlav described the Democrats and Republicans as being much the same in many regards, and I think he may have a point.
Indeed. I am on record saying a new paradigm must be reached for there to be any meaningful survival of the Perfect Storm. But then I run up against the pure forces of nature:
- Evolution: We are, after all, just the most intelligent animal, not something other than animal.
- Cycles: The rise and fall of nations/societies/cultures/populations. Why do they repeat? Is it simply that human intelligence cannot overcome human nature? (See above.) Weather, disaster, disease, growth, die off, knowledge... cycles in every aspect of life on this planet.
- Kennedy saw four parts of the basic cycle: Agrarian, militaristic, intellectual, acquisitive. (I forget his labels,so am approximating.) We are in the final stage, after which we return to the first. (And so many think getting your farm going is a silly notion.)
- Greed: Whether at the individual or group level, people want. Growth happens because of greed. Who needs 40 billion in net worth? Nobody. Who needs 1 billion? Nobody. 1 million? Nobody. Why then, do such fortunes exist? Given the finite nature of resources available (in the very broadest sense) at any given point in time, it is obvious that hoarding resources for ourselves eliminates the same opportunity for others. Yet, we do it. Then we blame the poor for being... poor. Insanity.
- Competition: We like to compete as a species. Literally. Games, sports, for mates, power. This makes the immediately preceding all the more likely to happen. And it does not get more genteel as time goes on. Look at professional sports today. The trash talk used to be a reason to be expelled from competition,to be reviled. Now it is considered an art. Altruism is going to overcome this? Well,it does, but only for short periods of time immediately during and after crises. It does not survive our own hunger or need to protect our own family on a day-to-day basis except in rare cases.
Etc. And I haven't even begun to list the practical constraints.
A political movement, which I shall dub "The Jon Initiative" (From the Forgotten Door by Alexander Key), to change the paradigm would need to overcome all of the above and more. It would require:
- the end of growth as a value
- an agreement to monitor and equitably distribute energy use
- that things have one value: their utility
- living in groups utilizing Dunbar's Number, or a near equivalent, as a constraint of development and planning such that being personally acquainted with the people around you would act as a check on greed so that it cannot disrupt the socio-economic-political fabric. This might be as simple as semi-/ autonomous neighborhoods in cities, for example.)
- population controls
- sustainable living practices, predicated by available resources (recognizing this can rise and fall depending on the development of new resources or technology. After all, were the moon, the planets and other celestial bodies made of all the resources we need for 20,000,000,000 to live well and happily and we had the means to get and use them, we could all live like Middle Class America, right?)
Etc.
Anyone see this pretty little outline having a chance in hell of happening?
Neither do I.
But this I do know: it would require a velvet revolution (a violent one would leave a scorched earth, thus being pointless) on a global scale.
Anyone see this as having a chance in hell of happening?
Neither do I.
Follow the stewardess' instructions, then give yourself the proverbial big kiss on your you-know-what if I am right.
Cheers
It appears the assumptions under which most of us have lived for the past 500 years may soon be put to a very powerful test.
As Daniel Yankelovich has pointed out, powerful cultures always breed a specific outlook, a world view, a general philosophy--what the French call mentalite and Germans call Weltanschauung. Commonly, scholars refer to the dominant world view of the West since the eighteenth century as modernism. Among modernism's principal features are its emphais on market values and other manifestations of individual choice, secularism, a concept of instrumental rationality, democracy as a political system, and a culture characterized by individualism, diversity, and pluralism in values and forms of cultural expression.
I wonder how many of these features will survive into the next century.
You left out what is perhaps the single most important element of modernism, especially with regard to Peak Oil: Progress Ideology, the view that the present is better than the past and that as we march into the future things will only keep on getting better and better. Peak Oil and other energy and resource limits, of course, represent the negation of one of the material pre-conditions for continued progress even to be possible.
John Michael Greer has written both extensively and perceptively on this matter in his blog - especially in posts that were fairly early in its history.
Secularism?
Based on Stephen Toulmin's Cosmopolis, I would date modernism from the 30 year's war, 1618-1648. The English Civil War is a piece of that same shift.
Here's a funny idea. Most cultures cohere quite tightly across a wide range of behavior patterns, from cuisine to religion. Cultures merge and split, but they don't usually get stuck in any kind half-split. It's not generally stable.
But it can happen. Europe sort of half-split in the 30 years war. Modernism is the culture that maintains that half-split state. Science is a kind of lowest common denominator of discourse that keeps us together - that's the secular aspect. But then we can all have our particular semi-private churches where folks are free to belief all sorts of amazing things.
So modernism manages to combine extreme religiosity with secularism.
Now we are getting into some kind of virtual reality or post-modernism, through cheap efficient communication and transportation. Churches are not tied to physical communities, but rather to virtual ones, where people are distributed all over the planet. Which allows even more extreme religiosity to ferment.
Where it all goes, I sure don't know!
Contemporaneous with the rise of the Westphalian state.
I suspect that this crisis to a large degree is a classical case of creative destruction. There might not be a genuine need to have tens of thousands of highly intelligent people trading obscure papers with each other. Their work can be rationalized away freeing millions of man hours for productive work.
It will probably end up directing physical resources into investments that save or produce fuel, electricity, food, etc to give tanglible long term low risk return on investments. People who want to hedge risks will have to do it the old fashioned way by stockpiling resources and investing in personal and corporate adaptability thru the hard work of learning things.
The cycle of packing this tanglible work and goods into abstractions will restart and sooner or later run amok untill the cluehammer falls down again. But from my point of view its more intresting with geting on with the productive work then saving the smoke and mirror workplaces. I have very large confidence in what can be done but I do not realy feel love for structures that favors consumpton over investments.
Now when I can imagine something good comming out of this it gets less worrisome watching the distress. And why should I feel sorry for irresponsible leaders finally reaping what they have sown? I am hoping for massive personal responsibility and then forgiveness and support so that no former executive and his or her family will starve to death or be withouth ok medicine or schooling for their children.
It's nice that there are no unrepentant drunken bullies in your family. We have out-of-state family members to whom we no longer speak. They escalated to cut us out of family wills, and we just maintained our distance. [At the time, none of us anticipated that about now they might be losing their shirts.]
However, I would think that most families are split by geography. In the lean times, it's those who live nearby that will become more relevant to you. That, and a barterable skill.
There is a tradition of very little drinking, which has helped. We do have relatives who were alcoholics, and this has been a family concern.
Leadership roles have been taken by those with sensible, stable outlooks. Some of these are/ have been in the clergy. My brother who is a psychiatrist is also a leader.
This is not to say that there are no problems. I have a sister who is paranoid and has other psychiatric issues, and refuses medical treatment. She doesn't want to come to family gatherings. People have made it clear that she is welcome. The rest of her family comes without her. When my nephew got married last year, they had two ceremonies: First a private ceremony, that his mother would be comfortable attending. A few weeks later, they had a public "reenactment" and reception for relatives from a distance, which his mother did not attend.
Regarding the problems of geography, I think the telephone helps a lot. In the future, though, you are right. Having relatives close by is going to be important.
From the author: "Our bank accounts are another form of wealth." - LOL!
Fed pump these days is turned ON 24/7 pumping billions of $ in order to make a softer fall for US. Hard to predict when outside-US world will lose the faith in this currency. For now however, all americans should not be saving and rather go shopping before this opportunity lasts.
Cheers, treat yourself good:)
Money as a form of stored wealth may not exist shortly. Personally, I think it was a bad idea to begin with, and historically, I'm not alone.
There are many feedback loops, and things can go various ways, but this is a concept worth considering.
You have a good point. The FDIC doesn't have much money--$45 billion the last I remember. This will cover a handful of bailouts. After that, someone will have to borrow more money to cover the losses.
If/when there are more bankruptcies, either the bank accounts go away because the FDIC doesn't have enough to cover them, or all the borrowing will make the value of the dollar drop greatly. Either way, our bank accounts are not likely to be of great value.
Hmmm....property ownership - deflating. Cash - devaluing or getting lost in a bank collapse. Stocks - going down. Bonds - defaulting.
Exactly where DOES one invest?
"Exactly where DOES one invest?"
In the future.
In future generations.
Canned goods. Seed for your garden. Maybe a some goods to trade with others.
Spend money on learning about gardening or a trade.
I think of investing as buying an asset (wheelbarrow, say) that you can use to produce goods in the future. Buying any asset that looks like paper or a line on computer screen is asking for trouble in the future. The promises behind the asset have a good chance of turning out to be worthless.
I like the second point -- trade skills.
Maybe arable land can go on the list as well. That's about the only post-peak "investment" where you can easily sock away more than a few current-dollar kilobucks without too much risk that I've identified.
My family members will be getting unusual Christmas presents this year. I'm thinking heirloom seeds and an adze.
One friend of mine has stockpiled some spare gun parts, ammo, and clips.....especially those that are likely to become conveniently illegal (again) if the tides change direction again.
My wife thinks canning jars and pressure cookers should go on the list as well. And just plain non-perishable food.
Hi Gail:
I concur with your post in most respects. However, I differ on the point that PO has anything to do with this. This is the result of systemic over-leveraging and the blowing apart of highly sophisticated risk management techniques, and it is principally fault of the investment banking community.
Let me explain....
I am a real estate lawyer, and although I close mostly high-end stuff, I also have closed thousands upon thousands of residential deals. In each residential file, there is a document called a URLA, and in it is a balance sheet and an operating statement of each borrower. During the height of the r/e boom, I was thoroughly astounded at the financial weakness of the borrowers who were coming to my table to close loans that I could not believe were being extended. Most borrowers were a few paychecks from disaster. All had credit card debt and car loans. They were leveraged to the hilt and just getting by. Many would come to my table to "pay off" their credit cards with a larger home mortgage (thereby not paying anything off at all) and return to my table a year later to do it again. I remember one couple who did it three times in three years. It was baffling to me why the financial community was extending the credit. I just could not understand it. Now I do.
One can look at the credit history of persons with FICA scores of say, 650 or better who own homes with not less than 20% down and conclude empirically that the liklihood of a default is x%. X% is your standard deviation to the downside. One can then create a security that is backed by a pool of mortgages from such persons and price it to a yield that assumes that the underlying default rate in the pool will never exceed, say, 2.5x to 3.5x, or 2.5 to 3.5 the standard deviation. With this "cushion", one can call upon a bond insurer to insure the security as to payment, and with the insurance, one can call upon a rating agency to assign it a good rating, and pretty soon, you have what looks to be a great security that yields, say, 200 to 400 basis points over the ten year treasury but still has a great rating and a guaranty. The demand for these securities was immense, because they looked like such great deals.
A central point: You can also do this with weaker fica scores and weaker debt to equity ratios (the so called "sub-prime" credits) where you use a higher assumption regarding defaults, a greater standard deviation "cushion" and an even higher yield to compensate for the increased risk. In fat, you can do this all the way down through the credit spectrum, and in fact most CDO's had multiple layers built into a single security.
So, if you are an investment banker, you want to create and sell these securities because your up front fees can reach 10% of the face amount thereof. Thus, you can reasonably expect to pocket and take home $100 million in doing a deal that involves a face amount of $1 billion.
So, you need these mortgages, you see, to create the security, so you buy them from warehouse lenders who originate the mortgages through brokers and hold them until they have enough to pitch into the investment banking community for securitization. So, the broker, you see, has the loan sold before he closes it, and the warehouse lender also has the loan sold before he buys it from the broker, so no one anywhere near the borrower gives a rat's *ss about the true credit quality of the underlying mortgage because the risks that are attendant upon default have been sold through to the purchaser of the resulting security and its insurance company guarantor. So, if you are a broker, you just originate as many of these babies as you possibly can because you are walking away with cash (the upfront fees or yield-spread premium) and sell all of the risk on down through to somebody else.
And so they did. And people who just barely, barely qualified on the numbers got credit, and with other people's money they bid up the price of real estate to insane levels, and the amount of aggregate indebtedness out there simply exploded, and it was obvious to everyone, somehow, that it was all unsustainable, but no one wanted to admit it because everyone was making so much money from it that it was simply incredible.
I am not sure exactly what tripped up the whole thing, but I think that it may have been the explosion in energy costs. The average family in this country, before the recent run up in crude, already was incredibly thin financially and was spending something like 20% of net income on transportation alone. So, these folks, being so weak at the outset that a puff of wind could knock them down, could not absorb the sudden and unexpected increases in energy costs. At least that is my theory. I think that when gas went through $3.50, it was literally a disaster for untold millions of persons who responded to it by defaulting on car and home loans in numbers that simply blew apart the standard deviations mentioned above that were the quantitative unperpinnings of literally trillions of dollars of securites that are out there on the books of hedge funds, mutual funds, on the balance sheets of commercial banks, and which are guaranteed by the likes of one global insurance company, here to remain nameless, that is very much in the financial press today. It was a black swan. It was not in the assumptions. And it is a complete, unmitigated disaster that threatens the global financial system.
So, I think oil had something to do with it, but it was just the rock over which the patient tripped before falling to the ground and receiving the injury. The underlying problem was that the patient was in an incredibly weakened state from the outset and drunk with other peoples' money when he came upon the rock. So, when he fell, he fell really hard.
Regards,
Pilot
You also need to ask what triggered or facilitated the credit mess. It was probably a combination of things, but likely suspects include Mr. Greenspan, Bush tax cuts and policies designed to recover for 9/11 and the tech crash, the Iraq war, the push for less regulation of complex financial instruments (read: schemes). Greed of course, but that isn't new. 9/11 and Iraq have everything to do with the need for ME oil. The first Arctic War will of course be about oil.
I believe that energy availability underlies everything, but there are lots of layers on the rotting onion.
I think it's clear that this problem pre-dates the Bush administration. Both parties are to blame.
I agree. But it gets even more intertwined the further back you go. When building a house of cards, the layer of the fateful card gets the blame.
Though I have to point out here that while Clinton signed the Glass-Steagal repeal, it first had to get through both Republican controlled houses of Congress.
The Republicans own this mess pure and simple in my opinion.
I think that's simplistic and inaccurate. You might argue that the Democrats had nobler motives - they wanted the poor to enjoy the same material goods as the rich, including home ownership - but in the end, both parties are to blame.
And that holds true to this day. Both sides are still trying to keep the debt party going, and nobody wants to pay the bill.
The Democrats certainly didn't stop the Republicans, even when they could have.
There is a seriously abusive relationship going there.
Oh. for the days of a do-nothing Congress.
Oh and can someone list for the all the times the Democrats, when they were "out of power" and fighting against mean old George and Dick, how many filibusters were there? A filibuster shows that a party really is going to stand by their principles and risk it all. That doesn't happen anymore.
They didn't even filibuster when they could have tried to stop the most vile and disgusting behavior ever sanctioned by our country: TORTURE.
They didn't because they agree with it and they went along with it, just like Telecom Immunity and the Federal Communications Act, etc., etc. Both parties equally share - no, scratch that, all of us VOTERS, equally share in this country's destruction because we have been too blasé and fell into their trap of blaming the other side.
This kind of thinking cracks me up! When oh when are people going to wake up to the fact that the two parties are essentially one? Isn't the evidence absolutely overwhelming that for decades both parties say one thing then do another? And during this same timeframe, who has benefitted and who has suffered? Corporations and the upper class have benefitted and the middle and lower classes have suffered. Democrats or Republicans in power: it is and always will be the same result because they are the SAME PEOPLE. They put on an act in public but they are in perfect sync in private.
It will take a generation (if we've got one to spare) but we need to pour our energy into creating viable 3rd parties to provide some kind of balance for our 1 party system. Start in November and DON'T vote major party.
I'm from Minnesota, we have as solid a third party tradition as anywhere, and I have no party affiliation.
There are plenty of things that I can find fault with for both "Major Parties", but the current financial meltdown can be largely attributed to 20+ years of Republican control.
Sure, some Democrats voted for or signed bills that made things worse, but from 1981 on it's been all Republican Go-Go on the economy. Less regulation for corporations, more regulation on individuals. Lower taxes for the rich, higher taxes on the poor and middle class with less security from the always dubious government programs enacted for such.
Both parties are equally to blame for the evils resulting from military adventurism, and the Democrats definitely have bought into a lot of the doublespeak plans from the past 20 years, but on issues of fiscal and monetary responsibility it's a Republican world.
But the donations from Wall Street roll into both sides of Congress - just about equally. Do you really think that if we'd had Democrats in full power since 1981, they would have continued taking million$$$ from Wall Street, but NOT enacted the same/similar pro-business legislation? Follow the money - PLEASE - the votes reflect the money, just about every time, no matter who is in charge.
Besides, from your benchmark year of 1981 until the "Contract With America" in 1996, the Democrats controlled both houses of Congress! So I think the argument can be made the the Democrats are really the ones to blame anything signed into law from 1981-1996. Without their support, it wouldn't have happened. Then the Republicans took over and things did not improve, they stayed the same or got worse, proving my point that the two parties are essentially ONE IN THE SAME.
Funny how Glass-Steagal wasn't repealed under a Democratic congress, isn't it?
The parties are different. Not as different as I would like, both are corporatist, but they have distinctly different agendas.
I blame the Democrats for Intellectual Property, and the Republicans for Irresponsible Finance.
They're all looters, they're just doing it in different ways.
This mess is the Republicans' fault.
The fact that I will die of old age before I can publicly perform "When I'm 64" for free is the Democrats' fault (I was all of 2 when it was released. Limited term my posterior).
Security Theater and the police state is shared equally by both parties.
Yes, it is funny that Glass-Steagal was repealed under a Democrat President. Oh wait, your point was that it was the Republicans fault since they held the Congress. But that just makes my point all the stronger: IT DOESN'T MATTER. It can be one party holding the Presidency and the other holding Congress, or one-party rule. The evidence for 30+ years shows that nearly ALL of their decisions are skewed away from helping poor and middle class and towards enriching the already-rich. If not then how else could the transfer of wealth towards the top have been happening all these years?
Banking deregulation is a Republican issue.
They run on it, they want credit for it, I blame them when it goes south.
Simple as that.
I live in Uruguay and something really wierd happened today. For the past two years or so the dollar has taken a fairly good beating dropping from 29 pesos to 19 pesos. With all of the financial goings on, the dollar actually strengthened to about 21 pesos. What could possible be happening that suddenly made the dollar stronger? Are the financial people here just buying into the idea that government bailouts are good because they will stabilize things without realizing that inflation of the dollar ( perhaps even hyperinflation) is going to be the price. My wife and I just paid off our house. With the local market reacting this way, I was thinking about getting another small loan to set up my farm properly. I make my money primarily in pesos. I have a fairly stable job. I benefitted greatly when the dollar took a beating as loans here are denominated in dollars but are paid off with pesos. Do I stay debt free in this situation or shoot for the small loan? I would use it almost immediately for farm infrastucture. This is a signature type loan, no collateral required. Interest rate is high for the U.S. at about 14% It would not take too much inflation in the U.S. to eliminate the onerousness of that interest rate. What are your thoughts out there? Thanks in advance.
Too many unknowns.
There are a great many signs that the dollar is headed for hyperinflation, and soon, but the timing could be pushed out further than I would believe by faith in the system.
An additional unknown is what the impact on other Western Hemisphere currencies will be.
If it were my farm, I'd be very conservative taking out loans in these circumstances.
If you really need a small loan to set up your farm properly, you might go ahead with it. It doesn't sound like you have many other obligations. It seems like there is a significant chance the dollar will drop more against the peso, and in that case, you will be better off. Loans are becoming harder to get, so there is an advantage to getting one when you can.
I wouldn't spend much on things that require a lot of oil to operate. If the oil isn't there, you may not be able to operate the equipment anyhow.
Uruguay is essentially as grassland so it is subject to periodic droughts. The loan money would be used to dig tajamares or water storage ponds to get thorough our dry summers (we usually have wet springs). It would also be used for trees as a greenbelt/natural animal fence and for wind protection. The ponds would have a secondary use to grow first algae then tilapia as a source of protein and potential barter/cash crop. Land use between orchard trees would be for chickens, ducks, and geese. The birds provide the fertilizer for the ponds and the trees. One of the ponds would be covered with a greenhouse for winter fish propagation. I teach at one of the American type schools sponsored by the state department so I know I need a backup plan. I´m trying to keep that school going for as long as possible. It is a form of community or at least part of my community. At the school I have started a waste oil recycling program. We sell families at our school sunflower oil produced locally at slightly above wholesale prices if the families agree to recycle their waste oil back to us. The plan is to have my chemistry class turn that oil into biodiesel to make electricity for the school. The glycerin byproduct goes to my physical science class to make soap to sell back to our school community. I have two other businesses starting, one which already makes a little money. One is making anaerobic digesters to produce methane from animal waste and the other is importing wind mills from Canada to sell to homes, farms and businesses.
The Gramm-Leach-Bliley Act (s900 of 106th Congress) that repealed the Glass-Steagall Act in 1999 was introduced by Senator Phil Gramm (R-TX) and in the House of Representatives by James Leach (R-IA).
Senate vote:
yea 54 (53 republicans, 1 democrat)
nay 44 (all democrat)
NV 1 (republican)
present 1 (republican)
House vote:
yea 343 (205 republicans, 138 democrats)
nay 86 (15 republicans, 69 democrats, 1 independent)
The final merged bill signed into law was veto proof (Senate vote: 90-8-1 & House vote: 362-57-15) meaning it had the support of Democrats in Congress. If I had been president, I would have vetoed it just to wash my hands of it. The links identify the traitors and patriots.
John McCain (R-AZ) voted yea and then did not vote.
Chris Dodd (D-CT) voted nay and then yea.
Joe Biden (D-DE) voted nay and then yea.
This was all an attempt for people to swing for the fences to replace the energy surplus that is disappearing. They may not seem linked but they are. With 25-30 billion barrels a year of 3000% gain rippling through the economy, the deserved damage from poor decisions was often bailed out - the cost of failure was cheap. As the energy gain went away (in the last decade via 1000% increase in prices, rising of GINI coefficient of inequality worldwide, environmental damage), cultural icons tried to replace the gain (which in modern society is translated into paper currency) by being creative. The cost of that creativity is now being born. It will also cement 'gross' peak oil, in addition to the 'net' peak oil already past.
What I think "tripped up the whole thing" was overbuilding in key markets. When the number of new homes available got well ahead of the number of potential customers, prices had to start to come down. This problem was aggravated by variable rate loans (ARMs), and especially no down ARMs. When the higher rates kicked in, that the borrower couldn't afford, the borrower just walked, the mortgage got foreclosed, the bank took back the property and couldn't resell it, so was forced to fire-sale it. All prices in the local market started to drop, "mark to market" kicked in, forceing the investment banks to kick in more equity, which they didn't have because they were way overleveraged, and the whole thing fell apart. Another element was builders who found themselves with a lot of houses in various states of completion that couldn't be sold, all being built on borrowed money, that had to declare bankruptcy, leaving the lender high and dry.
Eh? You start out by saying that you don't think PO has anything to do with the financial meltdown, you see, and you end by suggesting that the explosion in energy costs tripped the whole thing up. Which is it?
I would agree that the brokers and banks and everyone else except poor renters were participating in a lending/homebuying/real estate speculating frenzy, but I would also maintain that if gas costs stayed at $1 per gallon, the house of cards would have continued building higher and higher (with, perhaps, an even more spectacular crash when finite reality revealed itself).
Thanks Gail for reminding us of those highest of values. My family is searching for the positive and pragmatic. We're also looking at farms :-).
Like many others here, I've been reviewing financial decisions in light of the implications of peak oil over the past few years. I'd like to pose a question for discussion: how much trust do you place in the FDIC over the next five years?
For me, this has major implications regarding our decision on whether to keep some money in a cash account, or to pay off the money remaining on our home mortgage. If I had iron-clad confidence in the security of FDIC-insured accounts, I would keep the extra money in CD's as a rainy-day fund for a job loss or other unexpected personal event, with the understanding that I'm taking a hit (around 1% at current CD rates, after counting the tax deduction on the mortgage interest) to maintain the mortgage and not pay it off immediately. However, if that money starts looking insecure, I'd be inclined to yank it and pay off the house, leaving us with a clean balance sheet for whatever comes next. Any thoughts on this specific dilemma, or the soundness of the FDIC in general?
Five years?
Try five days. I'm expecting Washington Mutual to go under this Friday, and that will pretty much wipe out the rest of the FDIC fund (IndyMac took about 17% of the fund). This weekend's drama will be the FDIC going to the endless fount of cash at the Treasury for a bail-out (which is why I think Daddy Warbucks Paulson said "no" to bailouts last weekend, he knew what was coming and needed to keep his powder dry).
However, they will not let the FDIC go under. Period. They may pay you off with dollars that aren't worth a paper napkin, but they will make sure the FDIC is funded.
Why do you think they won't let the FDIC go under? (Note that I am not disagreeing with you; I only am very interested to learn more about your reasoning here.)
The FDIC provides a lot of "bang" (financial system stability) for relatively little "bucks". Every bank is vulnerable to runs, even in good times. FDIC insurance (a different agency for credit unions) is the "thin blue line" that allows banks to continue to function whenever people get nervous. It's really the best kind of insurance, the kind that by its very existence reduces the need for its payout.
I think that allowing the FDIC to fail would be abandoning the banking system altogether. We aren't anywhere near that, yet.
As chance would have it, WaMu happens to be the holder of our mortgage. That doesn't have any material effect on the decision, so far as I can tell, but it does provide a certain irony.
Thanks for the input.
If the FDIC fails to cover a single insured account in a failed bank, nearly every depositor would withdraw his money completely destroying the banking industry.
I don't think so.
Consider that people used banks before the FDIC came into existence. Reading through 19th-century American history, you can see that bank failures were fairly common and caused major dislocations. But the fact that banks could and did fail with some regularity did not keep people from using them.
Anyway, as I see it, the FDIC really protects the banks; prior to the FDIC, a rumor could start a run and destroy an otherwise healthy bank.
I would agree with Greenman below. The FDIC has virtually no money, ($45 billion max) relative to what they are insuring.
About all they can do is try to borrow more, and pay off loans with dollars "that aren't worth a paper napkin". The alternative is just defaulting. Neither of these are happy outcomes.
Your first priority should be having at least a little extra food and water, in case of a real emergency. It is up to you as to whether you pay off your mortgage. I would probably lean that direction, but in the case of massive multiple defaults, what will banks do with huge numbers of unoccupied homes? People will probably be able to continue to live in them regardless, but you can't be certain of that.
It's a pretty good bet that people with cash to spend will have their choice of houses, but what good is an empty house to anybody? Once all the foreclosures settle out, the value of existing houses will be determined by what people will (can) pay for them, and either landlords of some type or personal buyers will end up with them. If you have people who need houses and houses that need people something will work out eventually.
This is why my hunch is that the near future is bright for the "property management" business.
The FDIC has virtually no money,
Just like the government have promised to insure fission power plant failures, the FDIC has similar coverage.
Where this will get interesting is who/what the government will toss under the bus to keep on a-rolling.
At my Lutheran congregation in Seattle, we have a Care of the Earth group that is active in issues of environment--primarily global warming. Several of us are PO aware although we haven't specifically addressed the topic with the congregation. My major concern with PO though is that our commitment to the needy will be severely impacted by the decaying economy, declining tax revenues and inflationary costs. Food banks and other social service organizations are already struggling even in Seattle where the economy is better than most. In our own congregation, we are facing a funding crisis in the transitional housing that we sponsor. With the stock market taking a beating, tax revenues declining, and incomes being stretched by energy costs and inflation, it is likely that we are entering a time when non-profits and social service organizations will not be able to provide services to all those who require them.
I think you are right about it being a difficult time for non-profits. I think non-profits will have to go back to more of the "volunteer" model they had in the past, when there were more unemployed housewives. Now budgets are higher, and there is more paid staff.
This doesn't help with things like food, energy, and rent payments. We are going to have to find ways for people to live more simply--perhaps move together and share housing arrangements, and learn how to garden.
I normally sleep very well.
Last night I couldn't sleep and woke up a few times.
I am waking up to find that hundreds of thousands of dollars of my money are GONE. Like a thief in the night.
Years of careful financial planning have been destroyed.
And I don't have time to make it up! Wages haven't risen in a decade and prices and taxes are higher than ever.
A severe US depression lasting to 2011, says Roubini. Employment is 146 million, unemployed 9.4 million rising by almost a half million per month.
Frankly, I am surprised at the blaise, detached, BAU reactions on this board.
The situation is as dire as war.
A financial 911.
I suspect most of us here don't have that much money to lose. The average American simply does not have that much direct exposure to the stock market.
Well, many of us expected this....and worse.
That's one good thing about being a doomer (or even just hanging around them). You rarely get unpleasant surprises.
Leanan,
You CAN'T retire without money.
It's literally impossible.
And they TAX social security up to 85%.
I think even 'jaded' doomers would be surprised at how POOR they are.
The 'good' news is that due to record life expectancy your chances of living most of your Golden Years in abject poverty have increased ASTRONOMICALLY.
majorian-
Some of us have never worked a straight gig, and things like "retirement" are not part of the vocabulary. Everything is seamless. But you are right, if that's the world you live in, you probably don't have the time or wages to make it up, and a significant number of our fellow humans are going to be living a different existence.
I would not count on 0's and 1's on a hard drive for your future.
The superstition based economic model only exists as long as people believe it is actually there-- which, as we are beginning to see, isn't.
I think we all realize that.
However, we also realize that retirement a fluke. Many cultures don't even have a word for it. People work until they die. And, according to many studies, are healthier for it.
I can't think of an easy way to say it, Majorian... if you're lost that much then you either have far more than that in other investments or you (or your advisor) did a really poor job of asset allocation. Was all of your money in bank stocks? Hedged commodity bets?
The overall stock market is down just barely into the "bear" range, but someone close to retirement should have a pretty fair proportion of his assets in a mix of bonds (and similar) which have performed pretty well.
A well diversified portfolio for someone your age with a 7-figure balance should only be down about 10% or so at this point. What happened?
A well diversified portfolio for someone your age with a 7-figure balance should only be down about 10% or so at this point. What happened?
-10%....You read that on the back of a cereal box?
You ask me 'What happened'?
You FORGOT to tell me WHEN to sell EVERYTHING.
You know I simply can't do without your omniscient opinion, Photo Taxi!
(So how much are you down, Photo Taxi.
Zero percent !!
How can that be?
Oh...you don't HAVE any investments!
Brilliant!)
Nope... I just happen to know what I'm talking about.
Your most recent check for my advice never cleared. So sorry. Nor would I have told you to "sell everything". As I said... unless you did an incredibly poor job of asset allocation... this hasn't been that bad a year. No reason to change much of anything apart from rebalancing the portfolio.
(So how much are you down, Photo Taxi.
Sorry... I'm up not down. Was down a little until some fools drove oil too high and some of the good financials too low. Now up about 15% for the year.
Sorry... which of us just announced that he has blown a life savings? Which of us obviously played "DIY" in an area in which he had no personal expertise?
I am 39 years old, and I have long since reconciled myself to the virtual certainty that my old age will be one of penury - if I make it that far. My parents, however, are in their early 60s, and they have also been very prudent in setting aside a nest-egg according to conventional, perpetual-growth-oriented investment wisdom. I have a feeling that they are taking a significant hit with today's news as well - maybe also in the 10% range.
I love my parents, and I do fervently hope that a full-blown crash of standard stores of economic value is a long enough way off that they, at least, will be able still to enjoy a comfortable retirement. But events like today's indicate that their preparations, too, may be decimated within the 5-10 years that they have to go until retirement.
This comparison of my own situation with that of my parents illustrates a principle that I think applies quite generally: The younger you are, the more Peak Oil and its effects will matter in your future. (Seems obvious, I know, but I think it's sometimes overlooked.)
I'm about 45, and I've written off the idea of retirement - it's a recent invention of wealthy societies and dependent on large numbers of energy slaves. My hope is to eventually pay off all debts and reduce expenses, while learning to grow much of my own food, so that I might be able to get by locally with only a small income. I've got a long way to go.
I think that for some time many people have had a vague sense that the music would soon be stopping and that there would not be enough chairs, but we've been so conditioned to believe we'll be one on the few who make it big. I looked at the situation some years ago and decided that I would likely never be wealthy enough to escape being hurt by what is coming, and so I've been trying to operate under the assumption that I will eventually be poor. I suppose if I'm lucky I'll get to be old and poor.
I sympathize with your comments about your parents. My Dad retired last year, and I hope his investment choices work out for them. He's aware of much of what is happening, but he isn't able to accept the scope of the changes that are happening, and thinks that I've gone off the deep end.
Down from when exactly? I'm about 25% money market, 25% bonds, and 50% stocks. My stocks are pretty much all mutual funds, boring index funds & such. I'm probably down about 10% from the October peak. Actually there's maybe 2% gold in there somewhere, just in case things really tank. Of course gold is down more than anything else I own!
Even individual physical health is not the true foundation of happiness. It's your mind! Money, beauty, strength, friendships, all these come and go - ultimately, they always go. If you can cultivate the kind of mental suppleness and openness to turn adversity into an ally - e.g., to realize that every little difficulty one experiences is really small potatoes compared to what millions of others are stuck with constantly - there are people who can retain a cheerful and generous attitude under the direst circumstances. That is the true wealth!
Now would you look at that! What a wild coincidence, eh Majorian?
A reasonable asset allocation for someone approaching retirement and he's down about 10%? Think he got that off a cereal box?
And that's not just year-to-date, that's from the high. The dow fell 5-6% between then and the start of this year.
Wow, you are a ray of sunshine. Someone arrives on the board upset because of his financial losses - I'm really glad you are around to tell him what an idiot he is. Otherwise, he might have to pay someone.
Sharon
I'm really glad you are around to tell him what an idiot he is.
You didn't read the actual exchange, did you? I tried to figure out what had gone wrong and he got abrasive. The only "idiotic" thing was for him to come moaning about a huge loss and then try to imply that anyone else had money problems.
Given the tone of every post you have made thus far you are hardly in a position to be calling someone else abrasive.
Feel free to cite a post that was more abrasive than what it replied to.
Every single post you've made. That you cannot see your self-centered abrasiveness simply magnifies it.
Of course he sees it. In fact I'm sure he enjoys it.
Your pal says he's down 10%.Good for him.
He's also peddling mental health crap which in my experience is the sign of somebody who is unstable(Serenity now!). Just my opinion.
For me, the experience of watching 3 of the 5 biggest investment banks disappear as well as the declines of the bond, commodities and stock markets (and my investments therein)is finally getting to me. I AM worried.
But Photo Taxi, you say you're UP by 15%. Kewl!
Ya know, there's really a lot of uranium, it's everywhere like radon gas.--Photo Taxi
Sorry you took a hit, and sorry that some chose so inappropriately to give you a hard time about it.
Hope you get on the right side of some of the future events.
Best,
DaveMart, good job taking the high road, and I hope as you do that our poster comes out o.k....it's painful to take a hit like that, and everyone can "second guess" you...I got my ass kicked in the post 9/11 downturn, and folks I considered friends were very comfortable in basically calling me an idiot..."the quality of mercy be not strained..."
RC
Roger,
Isn't that our fate? To play the idiot?
Where else are the elite going to make their money if it isn't off the idiot masses?
Ooh ooh,
"Where else are the elite going to make their money if it isn't off the idiot masses?"
Erm, actually YOU are the elite. For the majority of the world (and increasingly in the 'rich' nations as well) most people exist at little more than subsistent level. Be glad you had a chance at the game, whether you won or lost, for a game indeed it is.
HBOS - UK 4th largest bank has just been taken over by the UK Fifth largest Loyds TSB. The government (ahem!) 'waived' competition rules to allow it to happen, after blocking LTSB's attempt at taking over Abbey seven years ago that would have meant it took 25% of the UK market share. Now it comes out as a mega-bank with 29% - that's not far off a third of domestic banking.
What was that parable of the Skinny cow eating the fat cow?...
As Gail and others have pointed out, there are far greater things that we should be focusing on in terms of riches and wealth.
While I understand the 'pain' (no gain?) that people are going through, this is the pain of living an impossible dream. Surely it is time to dream up a fairer system, not so 'red in tooth and claw' - a saying derived from a history of antagonistic relations with the natural worlds as 'original sin' and the fallen state of creation (http://www.romanity.org/htm/rom.10.en.original_sin_according_to_st._paul...). It does not take into account the symbiotic nature of life as the people who invented these ideas (or had them revealed to them) either did not recognise symbiosis because they were still actually living symbiotically with their environs or they had lost that connection and were ignorant of it. As an emergent scientific field, symbiosis has itself only recently been revealed through the sciences. (see Margulis et al: http://www.garfield.library.upenn.edu/classics1993/A1993KK54300001.pdf)
L,
Sid.
He's also peddling mental health crap which in my experience is the sign of somebody who is unstable
Lol! Who was the one who couldn't sleep at night?
Ya know, there's really a lot of uranium, it's everywhere like radon gas.--
So you can add geology to the list of things you don't understand? Should I be surprised?
There's about 30-50 times as much of the stuff as silver (and more than quite a few elements you probably accept as common - like tin).
I note that despite being given plenty of opportunity to explain how you could have lost so much... you've remained silent. Now why would that be? It couldn't be "privacy" or you wouldn't have announced the loss in the first place.
Sounds to me as though you may be in need of a little more geology yourself.
I may be misinterpreting your earlier statements, but just because radon, and hence uranium is widely distributed in the crust, does not mean that it can be recovered for human use. As somebody who gets paid to find economically mineable deposits, I can tell you that crustal abundances are largely irrelevant to the amount of economically recoverable metals. Unless some geologic process acts to concentrate these diffuse elements, no economically recoverable deposits occur.
In other words, just because you have dangerous levels of radon in your basement does not mean that you will have a uranium mine below your house.
Photo Taxi is a geological idiot and a cornucopian.
The maximum amount of radon gas in your basement before you'd have to immediately vacate is of the order of a two hundred trillionths of a curie per liter(200 pico curies per liter)--a curie is the amount of radioactivity in a gram of radium(which is worthless), .0000000002 grams per liter(radon comes from the decay of radium)and there are 453 grams in a pound.
In an average sized house that represents about .0000001 pounds of radon.
Obviously such a tiny amount of radon gas indicates absolutely nothing about economic uranium deposits.
The amount of reasonably assured resoruces in the world is 3.2 million tons(IAEA). The amount of directly inferred but unproven is an additional 25-30% and the amount indirectly inferred but undiscovered is another 25-30%. Then there's
the additional 'magic' speculative reserve of something like 9 million tons. A maximum 'resource' of around 13.7 million tons(of which 24% represent actual known deposits and 76% is currently UNKNOWN); this maximum estimated resource on this planet is equal to a cube 284 feet on each side(is that a lot?).
The amount of the world uses 50,000 tons of uranium a year today.
The USGS gives a world 'resource' of tin at 11 million tons.
The amount of gold is 90000 tons and silver is 570000 tons.
Obviously there isn't a huge amount of uranium in any expert's
opinion.
"Obviously there isn't a huge amount of uranium in any expert's
opinion."
Hence the interest in extraction from the ocean/possibly rivers -
"How much uranium is there in seawater?
Seawater contains 3.3x10^(-9) (3.3 parts per billion) of uranium, so the 1.4x10^18 tonne of seawater contains 4.6x10^9 tonne of uranium. All the world's electricity usage, 650GWe could therefore be supplied by the uranium in seawater for 7 million years." From: http://www-formal.stanford.edu/jmc/progress/cohen.html
L,
Sid.
Good luck with that!
Can I sell you some stock in a seawater uranium mining company I just started?
Hey, there's gold in seawater too! I'm so done looking for gold in the deserts of Nevada; Bonaire here I come!
Majorian, I was in a similar position as you are a few years ago. I lost most everything in the stock market. You need to just chill out for a day or two. Don´t get so obsessed that it effects you health. I was a basket case for several weeks. Save your health and you should do all right. Remember you have a brain that works well. Yes, my thought of retirement by the pool reading the classics has changed rather dramatically. But to be honest, I am easily bored and prefer to be doing things. Now I have positive things to do that are very rewarding in the real sense. I teach children what is coming down the road and how I think they may be best prepared for it. There is much work like that available. Find it now before the big rush. The flip side of horrendous demand destruction is getting to build it over again. Hopefully building it the right way.
I can't think of an easy way to say it, Majorian... if you're lost that much then you either have far more than that in other investments or you (or your advisor) did a really poor job of asset allocation. Was all of your money in bank stocks? Hedged commodity bets?
Considering you do not understand the word 'finite' - no wonder you have the above opinion.
Retirement is something that was invented in the depression, when there was massive unemployment. In order to reduce the size of the work force, it was decided to offer social security to people over 65 years of age. At that time, there were very few over 65.
It is possible that some tiny retirement program can be maintained as the world gets poorer, but nothing nearly as generous as our current social security system. Investments are mostly going to disappear, as more and more companies fail.
I think mostly we will have to move to the model that has been used through the ages, and that is used by the majority of the world's population today. People will need to work as long as they are able. People who are too old to live alone will live with their children. Children will help support their parents. Parents who don't get along with their children will be out in the cold.
Many of the customs of the past don't make sense when you have a government that provides for you and investments that seems to grow infinitely. When this disappears, the customs of the past suddenly make more sense. Arranged marriages start sounding like a good idea when it is critical that the spouse is responsible and will stick around for life.
In those societies people also choose to have as many children as they can manage, to give security in old age.
Population seems likely then to be controlled by a high death rate rather than as sinking birth rate.
It is true you can't retire without someone having money. But it doesn't have to be you - historically speaking, you didn't really "retire" you moved into the informal economy. You watched the grandkids and cooked soup while your daughter went to market. This will be a problem for people who are quite alienated from both biological and elective family, or those who have been assuming that mostly what they needed in the future was money, not relationships.
Sharon
I am 39 and don't have any expectations of retirement. Most people my age and younger who I know don't expect the system to be around for us.
I am sure it is a shock when expectations are unmet, however.
The problem with being a doomer is its like having kooties. Nobody wants to hang around a black cloud. The world has been here for a few years and will likely remain for at least one more.
Never have humans had it so good and bitched about so endlessly. Perhaps we ought to have a little gratitude for what we got and cease trying re engineer the world to suit our opinions. Besides, 7 billion people will do what they will do no matter how time you spend twisting your mind into a pretzel or demanding they do otherwise.
The above statement is something that I try to remind myself everyday so that I do not become a black cloud.
IOW, we have become a nation of whiners?
Not true, the average American is quite exposed through their 401k
Average 401k balances of around $100K
To actually retire you should probably have on the order of a million socked away
http://www.boston.com/business/personalfinance/articles/2006/08/25/avera...
Boomers and people near retirement are very vulnerable if they have 401k balances heavily invested in equities.
Someone nearing retirement could easily have lost $200K or more over the last year, all the while playing asset allocation by the book and not doing anything stupid.
Since most Americans either don't have enough retirement savings to begin with are are squeaking by, the recent crash can easily push them over the edge into poverty.
As far as Americans working past retirement, good luck getting and holding jobs at age 70.
The average American does not have a 401k. And the $100k figure applies to accounts held since 1999, with the mean amount being less than $20k.
http://www.boston.com/business/personalfinance/articles/2006/08/25/avera...
(2-year old data, but the market is now where it was back then).
Only about half of Americans own stock. The average 401(k) might be $100k, but I suspect the median is much lower. I've heard less than $50K.
Many employers don't offer 401(k)s, and of those who do, only 70% of eligible employees participate.
And of course, if you're talking about the denizens of this site, probably even less of us own stock. Many of us here, fearing something like this, cashed out a long time ago. Even eating the early withdrawal penalty if necessary.
Latest figure I read (pretty shocking) is that the median American household headed by a baby boomer has less than $100 thousand net worth (including home equity). I remember Greenspun going on about the wonders of the new financial economy and how homeowners were getting wealthy by accessed wonderful liquidity through lines of credit-they are still letting this shmuck on the airwaves. Supposedly McCain has dreams of turning SS over to Wall Street-they did this in Chile and the sharks took 15-20% of all the proceeds.
There are big differences between mean and median savings, and people tend to use the terms interchangeably.
Study from here: http://www.bls.gov/opub/cwc/cm20050114ar01p1.htm
dated 2005.
Of course, home equity "savings" are plummeting (inverse leverage, for those with mortgages). And you need to live somewhere.
In savings, as in income, some people are doing just fine and the large majority (the "whiners" according to Phil Gramm) are in tough shape.
You're right-it might have been mean, not median. Even more surprising I guess.
BrianT said,
"Latest figure I read (pretty shocking) is that the median American household headed by a baby boomer has less than $100 thousand net worth (including home equity)."
That's shocking alright! That statistic just goes to show the difference between the prosperous coastal areas and the U.S. south...most folks in central KY would think they had gone to heaven if they had anywhere near $100 thousand dollars in net worth! :-)
RC
Put me in the crowd who expects the Gov't to raid 401Ks (by restriction and/or borrowing) and it'll be worth about as much as social security - nada.
Once your house is paid off and the kids are up and out, it doesn't have to cost a terribly large amount to "live" without "retiring". Certainly there are people who work in their 70s, though maybe not at "peak wage earner" rates. Many more will do home-based work or other non-standard jobs. The 9-5 desk job is a pretty new apparition, and I imagine there will be few semi-retirees doing those.
I assume MANY boomers will not retire anywhere near as early as they hope, and probably not at all. As if things aren't bad enough anyway, as soon as a huge glut of new retirees starts tapping 401Ks there will be a resulting exodus from stocks, and the value will certainly sink further.
I strongly resemble that comment, but I also have kids starting college. They real concern is not about complete retirement, but downshifting either voluntarily on involuntarily to a much lower paid job. Those of us at boomer age -or older, probably will have a tough time finding decent employment if the need arises.
Good luck getting a job past 70? In the experience of the several people I know who have been out of work in the past few years, good luck getting a job past 50. There is massive age discrimination in the labor market. 70? Mall-Wart greeter, if you are lucky.
There is a lot of smugness being displayed here about certain people's investment prowess. Vanguard is known to be one of the most solid mutual fund investments around, and they have a pretty good track record. Let's look at how their Target Retirement Funds have done YTD, as of 9/16/08:
Target Income Fund (Most conservative, for people already retired): -3.28%
Target 2005 : -5.99%
Target 2010 : -8.50%
Target 2015 : -10.34%
Target 2020 : -11.80%
Target 2025 : -13.34%
Target 2030 : -14.75%
Target 2035 : -15.53%
Target 2040 : -15.57%
Target 2045 : -15.51%
Target 2050 : -15.55%
I think anyone down 'only' 10% should ring up Vanguard. It looks like they could use your help.
You can see from your list, Vanguard is quite capable of managing a portfolio that is down only 10% YTD, or from last year's peak too. Maybe I have just got myself invested too conservatively? Or maybe reading TOD for a few years and being peak aware for a few decades, I have a little less confidence in stocks than some might? I didn't ride the market up too intensely, and I am not riding it down too intensely. Still, even if I only got hit 2% today instead of 4%, I sure wouldn't mind a return to some nice steady 9% ROI or so.
Really, I think Gail makes some very good points, about where to invest. I've been buying extra spare parts for our bicycles. I've been rather liberal about buying garden tools. We have corn, tomatoes, zuccini, collards, cabbage, peas, beans, and peppers in the garden. Some did well, some not so well. I'll try to learn my lessons and do better next year.
My sympathies to folks who have gotten burned in this nasty market. Life is a gamble! Money and wealth are really illusory and can evaporate like morning dew when the sun heats up. It's really a good time to reflect on what is important.
I bought into the hype back in the '90's, but I've shifted my mindset and I'll deal as best as I can. I have been moving to self-reliance but I'm really not all the way there yet and I still have much more debt than I am comfortable with.
If this happens too quickly I am totally in the stewpot, so I agree with your assessment of the severity of the situation. Yet no war was ever won by anything but methodical, deliberate, and persistent action. And thus what you see here: Methodical, deliberate, and persistent.
Some of us hedged by shorting the market. I'm up 20% this year, although I did take a .25% loss yesterday. I don't see how one can read TOD and be all long.
A reasonably diversified portfolio would have done just fine yesterday with treasuries up 3.5% Cash didn't lose anything either.
Lastly, with the market down less than 5% yesterday, you must have 20 times 'hundreds of thousands' laying around. I guess I can't really relate to your issue, whatever it is.
I'm 30.
My retirement plan?
Work until I drop!
You'd be lucky to have a job that long.
Every day is work. Some work is posting on the oil drum, other work is digging in organics in the garden, still others is canning.
Since this post deals with the nexus between the secular and the spiritual, between this world and the other world, how many of you have heard of the latest twist in Evangelical Christianity, known as Prosperity Gospel?
Time had an article about it:
http://www.time.com/time/magazine/article/0,9171,1533448,00.html
The underlying tenet is that, if you are "right with the Lord," then he will bless you with manifold worldly abundance.
What are the odds for a marriage between Prosperity Gospel and Prosperity Politics?
Not a whole lot new here, I would say (ref the Time article). My sense is that the prosperity gospel might be enjoying something of a resurgence among lower middle class people threatened by downward mobility pressures.
After 9/11 in US there was a quite predictable circling of the wagons around the meme of patriotism - a societal generating of cultural capital, which GWB effectively squandered (along with economic capital). Now after 9/15, around what big meme will people regroup, especially the vast middle classes? The political dimensions are fascinating, particularly with the timing of the general election. But Gail's post (thanks Gail!) helps bring into focus the far deeper issues of how people's basic worldviews may be threatened. I keep wondering when the apocalyptic meme breaks out bigtime (and how would that link up with the prosperity gospel)? My guess is apocalyptic ideas begin to spread after the November election, if the economic malaise continues and McCain/Palin lose. But I've been wrong before about when real cultural shifts happen; seems like the situation will have to get a lot worse (or, rather, the full implications of the current crisis more clear) before we see these tectonic cultural shifts.
BTW, what are the chances of Obama/Biden hitting religious themes in the next few months?
This is hardly new. Remember the "name it and claim it" crowd of the early 80s? (Or as we used to call it, "blab it and grab it") Amazing that people would be that undiscerning, but they are. It just points out to me that most people do their thinking by first finding a system of thinking that suits them, and then justifying it later. And in our culture, there are always plenty of people who want to hear "God wants you to be rich" but reject "take up your cross and follow me."
And how many don't want to think about what "The borrower is the slave of the lender" means? This is not merely a religious issue.
Dan
I think it is closely related to the message people are learning on television.
People can have faith in a lot of things--the stock market, the predictions of their financial analyst, the ability of the Federal Reserve and treasury department to solve all crises, or the latest prosperity gospel. They are all kind of silly. People like to think things will work out in a positive way, and that their actions will make these things happen. Unfortunately, I don't think things really work that way.
Gail,
Thank you for posing this question about how it is affecting TOD readers.
On the big picture front, last fall we sold our urban center home and bought a farm in the rural, depopulated tall grass prairie. We are in the process of fencing in 100 acres of row crops and converting to pasture for grass fed beef and maybe dairy if I can talk my husband into it. I cashed out of the market substantially to buy this farm.
Last night I started looking for hand powered grain drills. Perhaps it is just co-incidence, but in the past day they have risen from about $280 to about $350.
My husband is not alarmed, says I need a new "hobby" other than post-apocalyptic planning, and is not farming from a sense of urgency, but a sense of satisfaction.
I am learning. I have much to learn. Last night I sat in the garden looking at 1000 ft of a high yielding black turtle beans and then struggled to figure out how to harvest them before they explode from the pods. They're too close to the ground to combine and believe me hand harvesting a pod at a time is a losing proposition.
I'm banking on having much more time and many 100's of gallons of diesel fuel to figure all this out......
Good luck on your endeavors! Sounds like you are doing well.
Are your Black Turtles actually "snapping" and scattering seed? I grew them back in 2001 and let them dry on the bush, then harvested the whole plant and did the "burlap bag and bat" thing. IIRC, only a few shattered. I've done Maine Sunset that way in 2002-2004.
This year all I dried were some Black Valentine and Italian Flat for next year's seed.
Good Luck! A thousand feet of black beans - that's a lot of frijoles negros!
We here in the Willamette valley are being swarmed. People are moving here from all parts of the Country.
Enrollment at the University is up. Students have flocked to town several weeks earlier than any time in the last 6 or 8 years. Rentals are being fought over, seriously.
There is a sense of urgency about it all that is palpable. I can see how this could get very problamatic very soon.
At the same time several large mills have closed. HP layoffs are starting to hit people I know.
So lots more people and less jobs. Not good. I don't think the enclave concept will come about in a nice way.
Lots more shaggy folks and homeless folks hanging around. I come to work at around 6am sometimes and there are people sleeping under and on top of my out door tables. That’s new. That will thin out when the weather changes maybe.
Personally since we have zero debt and have hedged on supplies for the shop in a HUGE way, we are in really good shape. For now.
I consider myself the Robin Hood of soup. I charge a premium from the folks who can pay and give it free to those less fortunate. I bring quite a bit of soup to the Outreach center, The womens shelter and the day shelter downtown. I only occasionally give a free bowl at the shop and I always ask them not to abuse the situation and no one ever has.
The students seem completely oblivious. They all have bought in hook, line, and sinker to the "go to college and get a good job" paradigm. Frankly, I don't see anyway to shift that thinking. I have talked to dozens of students who tell me they are not worried about their student debt as they are learning to trade in the stock markets and will soon be able to pay their way. What can you say to them?
Its getting real interesting around here.
How about suggesting that they drop the generic B.A. M.B.A. or whatever program, get into a tech. college and learn a trade, and at the end of that if they still wish to pursue gambling as a lifestyle stick to something less risky like on-line Poker? :-)
I'm afraid I don't have a good answer. It is hard to unlearn years of absorption of our current culture. You have to just handle each case on its own basis.
"You have to just handle each case on its own basis."
Yea, thats basically what I do.
However I believe we are in overshoot WRT to college degree grads expecting to enter the "professional" workforce.
It does take a considerable effort, the hard part, to unlearn things you thought for certain that just ain't so. It also takes a fair amount of time.
But the older you are, generally speaking, the more your experiences get wrapped around that internal narrative of the things taken for certain that just ain't so. It's generally harder to unlearn when you're older.
It would have been far easier for me, personally, 20 years ago to unlearn the monumentally flawed trappings of media, religion, economics, and the like. But I had no community feedback from people who could see something was amiss with the world, no guidance, and insufficient access to information.
We also tend to have a quick-fix mentality, an inter-dependent result of black swan energy slaves, mind-boggling complexity, and normal human laziness.
Quick fixes cause more problems later on than they solve current problems. And while many are looking for some universal definitive argument to wake up people who are asleep, that universal argument would be another type of a quick fix.
There is no such argument because for those people who "don't believe" in peak oil, climate change, overpopulation, or mass extinctions, their reasons are varied and complex.
But as you interact with more people, you'll find techniques that work better than others. You'll find some explanations work only in certain situations. In the same way as it is a long process of waking up, it's also a long process of figuring out what tends to wake people up.
"Mastery", by George Leonard, does an excellent job of discussing the problems of quick fixes, the benefits of addressing things systemically, and what can be expected on the path from learning to mastery. Mastery on Amazon. It's also on P2P and probably available at your local library.
Thanks from one who probably doesn't do enough.
To Pos-Phot and other true believers in techno fixes: your arguments ignore the rate of population growth and resource consumption since the 19th century. Finite resources and accelerating demand curves make for huge challenges; investment that would increase the supply of alternative energy sources continues to lag far behind the curve of population growth. The irony, of course, is that the faith in technology and the whole project of modernity in its global, capitalist form (combined with the efforts of 19th century medical missionaries who managed to blend faith in both the rational and the irrational into a mission to save the world from the population stabilizing forces of famine and disease) is what has caused the world's population to rise from around 2 billion when I was born to the nearly 7 billion (and still increasing) it is today. Gail the Actuary's posts are always thoughtful and well-informed. I applaud the warmth and humanity she brings to the OIl Drum.
Nope... it really doesn't. I wasn't arguing "fixes" so much as pointing out that when your great grandfather predicts a thing and turns out to be wrong... and then your grandfather predicts a thing and turns out to be wrong... and your father predicts a thing and turns out to be wrong... then you can't say "well we're bound to be right eventually".
When the world's population was at 2 Billion... there were many who were certain that it couldn't hold much more.
I also applaud any "warmth and humanity" I find in the world. I just don't give it any weight in a science/logic discussion. The number of people who really REALLY care about global warming doesn't make it any more or less true... and the number of people who really REALLY don't believe in it doesn't shift the odds in their favor either.
As for technology? As I said... that wasn't my argument... but you miss an important point. These advances (historically) far outstrip mere "exponential" curves. If they crack the "cold fusion" problem, you could wake up one day to find that we haven't used a significant fraction of one percent of the available energy... and that's hardly the only possible advance. These things tend to catch people by surprise.
I have heard people talk about how there have been preditions from years past that turned out to be wrong, so why should we believe the current predictions?
I was introduced to Hubbert's writings in 1976, so I have been "peak aware" for 32 years now. Not quite the level of history, but still - long enough to see how robust those predictions have been. My prediction over the years was that peak oil would be around 2025. Ooops, it seems to be coming a bit early! But there are monster error bars around these predictions, as anybody should know.
Take a good look at those graphs of oil discoveries versus oil consumption. I guess a belief in miracles can see ways to avoid facing any facts at all. But in the end, science and technology are not about miracles, but about reality.
So when you saw global production peak and then decline for several years... you naturally assumed what?
Not really. Not even close to "long enough".
You find Hubbert's predictions to have been "robust" yet you felt he was off by a couple decades?
Except of course that it didn't/hasn't.
Take a look at the price of oil up until 3-4 years ago. Little chance of "discoveries" if there's little point in looking. Then compare that to more recent efforts in the post $100/bbl world.
I know that lots of folks here would like to nail the peak down to the month or year, but I think that's basically a form of distraction or entertainment. It probably isn't very meaningful either - with a long bumpy plateau, small differences in accounting methods could shift where the peak appears by a decade.
A similar absurdity is the concern people have about individual survival. Sorry to bring up the bad news, but nobody survives!
A good working analogy is the collapse of the Roman Empire. It took centuries and probably nobody thought of it as a collapse until even more centuries later.
You might be familiar with the audio illusion of the ever rising tone:
http://en.wikipedia.org/wiki/Shepard_tone
Similarly, it can happen that at every point during a collapse, people find it easiest to see that things are getting better. The trick is to keep shifting the reference point.
This is also like the hedonic substitution business in computing inflation. It's easy to imagine a situation where the official statistics show deflation but the reality is inflation. The illusion is created by the shifting reference point. Each little shift looks plausible - it's only when you string a series together that you realize you've been had.
The thing is, our general perceptions are scaled to short time periods. But the kind of shift we are in the midst of is something that unfolds over decades and even centuries. So yeah, a shift from 2025 to 2010 is really in the noise.
It's not just a matter of "nailing down the month".
You may remember that Hubbert's predicted "peak" was about 33 milllion bpd at to occur in 1995.
Yet the world currently produces two to two and a half times that amount (depending on what you're counting and what you assume he was counting) well over a decade after that peak yet you characterize his predictions as supported by current conditions?
I read Hubbert's Senate report from 1968 - it's buried in storage at the moment, so that date could be wrong. But I recall no such prediction in that report. What I came away with from that report was that the peak would likely occur some time in the 2020-2030 range.
We will never actually know when the peak has occurred, so in some sense this is beyond science. But anyway such metaphysical speculation doesn't matter! What matters is whatever can help us make decisions so the consequences of our decisions turn out as positively as possible.
Most decisions have effects that last at most decades, or maybe a couple centuries. Things like species extinction or global warming or nuclear waste, these are really big decisions that last millennia. But that's unusual. Really, what is interesting for petroleum production is to get some sense of the availability of petroleum for the next century or so. I think it was Winston Churchill who decided to switch the British Navy from coal to petroleum before WWI? Is it getting to be time to be switching our infrastructure off of petroleum?
We have these important investment decisions to make, despite all the uncertainty about the consequence. Sure, the future is hard to predict, but that doesn't get us off the hook. Of course, some kind of statistical approach is a good way to deal with uncertainty. I liked this RAND report:
http://www.rand.org/pubs/monograph_reports/MR1626/
You are obviously correct, PP, that we cannot predict the future in a provably certain way. What are you proposing instead? One popular alternative is: "I will cling to my fantasy unleas someone can prove it is impossible." I hope you have not retreated so far as that!
Sure, Hubbert's predictions were not the ultimate answer - in fact, they were just a starting point. So what are you proposing as an improvement?
The point is that he made numerous predictions over a period of time and they vary pretty wildly. It’s, shall we say, “convenient” that his supporters will pick one or another of them to “prove” that he was correct. Heck… if I get to lay 12 chips on the table at roulette, my chances of picking the winning number dramatically improve… but what would you think of one of my friends years later pretending that I had some magical ability to tell where the ball would land?
His 1956 prediction was that total world production of oil would be limited to 1250 billion bbl (a number we now know is dramatically low)… and that daily production would peak around 2000 at 2.5 times the then-current rate. It’s important to note that he also made clear that if they pumped above that peak rate, the peak would arrive sooner. Instead we are well past that point.
He also predicted a peak of natural gas production in this country at 14 trillion cubic feet per year to occur in 1970. Of course we can look back and see that this was incredibly far off, and that US production is now experiencing something of a boom.
We need to keep this in perspective as the true believers argue over whether the peak is already past (as I heard re: nat gas just a few months ago) or should be shifted to 20 years from now.
Ever heard the story of the boy who cried wolf? Don’t blame everyone else when the latest prediction of “doom within ten years” isn’t believed. “I’m going to be right eventually” just doesn’t cut it.
I “propose” not spending trillions of other people’s dollars to “fix” a problem we don’t know exists. As for “clinging” to a “fantasy”… It could easily be argued that this is what the true believers are doing.
PP,
Other than being an abrasive devil's advocate, I don't see what you're trying to accomplish.
You have provided no new information -- everybody who comes here regularly knows the basics of what you're saying already.
For each of your arguments, the converse is also true -- you CANNOT prove that another single barrel of oil will be discovered, except by waiting until it is discovered. Where is your scientific info and charts which show a curve upwards in production? The onus is upon you to provide EVIDENCE to refute a well-researched and supported hypothesis.
Regardless if the peak was last year or will be 2050, it would be well-advised to start "spending the trillions" now to make a change. It's not "other people's dollars", it's "our dollars". These dollars that are under gov't control are getting spent in numerous ways today that I don't agree with, but still they get spent. At least I get to choose more intelligently where to spend my remaining dollars, thanks to the information on this board.
We absolutely know a problem exists -- look at the balance of trade and balance of credit worldwide. Many changes make perfectly good fiscal sense REGARDLESS of whether oil ever gets more or expensive or not.
I assume you somehow get your paycheck from a BAU concern, and you see some vested interest in confusing the discussion with logical knots of little substance. Kinda like the cigarette lobby, really -- a facade that panders to addicts who want to believe, yet offering no substance or scientific support that isn't fabricated or spun to meaninglessness.
Amazing that the "end of the world is coming any second crowd" would call anyone else a "devil's advocate". :)
And yet is blind to it because of an echo chamber a fear mongering. That echo chamber effect is what can be so dangerous to logical thought. A voice of rationality is not out of place despite how you may fear it.
That's really the question... why would you get so up in arms over someone disagreeing with you? Isn't that a sign that the belief is more "religion" than anything else? If I say that I think my company will produce "x" next year and you say that's way off... I certainly wouldn't take it personally... yet so many here act as if I just told them that their god doesn't exist.
Hint... if you read through my posts, I doubt you'll find anything "abrasive" starting with me.
Of course (ignoring the hyperbolic part of that)... and yet I haven't tried to make that point.
No... we don't.
Of course. So sell them on that basis. Why would you expect anyone to argue if you said “Ii can produce electricity cheaper than you can” ???
Another symptom of the true believer. Anyone who disagrees must know that they are wrong and be getting paid to disagree in public.
Do you realize how sad that is?
May I simplify? You are completely and utterly full of $#!+. You have an agenda, and it is not to enlighten or discuss. Whose payroll are you on, troll?
Look at the crap you spout: "true believer" "blind to it" "chamber of fearmongering."
This is obvious propaganda.
You've been called on your unfounded, unlinked, un-sourced assertions.
Shut the hell up.
That's science! He derived his predictions from a variety of data, like the history of production and discovery. He carefully explained how he extrapolated from the past into the future. As he refined his methodology and incorporated more data, he updated his predictions. He did not practice the foolish consistency of a dogmatist.
We are stuck making decisions in the face of uncertainty. We don't know how much petroleum we'll be able to pump out of the ground in ten or twenty or thirty years. Whatever we do, it's a gamble. The safe way to play a game like this is something like: estimate the probability distribution of results for each alternative, then pick the alternative whose 10th percentile result is best.
Even simpler: what's the downside of spending trillions if the problem turns out not to occur; what's the downside of not spending the trillions if the problem does occur? Pick the alternative with the less painful downside.
Even simpler: what's the downside of spending trillions if the problem turns out not to occur; what's the downside of not spending the trillions if the problem does occur? Pick the alternative with the less painful downside.
A very reasonable question... but it implies that the chances of both are equal and that those are the only two options. We can argue the first, but the second simply isn't true. It ignores (as just one "for instance") any substantial advances in science - which tend to be revolutionary as opposed to just evolutionary. Worse than that... spending the trillions now could keep those advances from occuring since it would be the economic drive of $400 oil that pushes that along (like the war did for the manhattan project).
No,you are just full of crap. It's like trying to have a rational conversation with a 9th grade student who has just started a Reasoning and Rhetoric course and has lost sight of useful conversation vs. "winning" whether actually right or wrong.
The question implied nothing like what you state. It implies, to one not looking to poke people in the eye, that all implications are included and these two choices are what one is left with at the end of the inductive/deductive process.
Perhaps this will help you understand risk assessment: http://www.youtube.com/watch?v=mF_anaVcCXg
It's a very long series. You might just skip to the "no holds barred"set.
Again, who is paying you and what is your agenda?
Ignore him.
A quadrupling in price has given us a 1.5 mbd total increase. Amazing. To get another 10 mbpd, we only need what... a thousand fold increase in price?
Tell us how that's going to work, light bulb boy.
A quadrupling in price has given us a 1.5 mbd total increase. Amazing.
What's "amazing" is that you could be on this board and still try to pretend that extra production could be turned on like a lightbulb. Prices have only been that high for a couple years. If oil was previously discovered in a particular formation and was rejected for production because it would cost $80/bbl to bring it to market... they aren't going to get any of that oil mere months after oil crosses the $80 line.
From 2000 to 2004 price quadrupled from $10 per barrel to $38 per barel yet production rose by almost 8mbpd despite prices having been low for nearly 2 decades. From 2004 to 2008 price quadrupled from $38 per barrel to $147 per barrel yet only rose by 1.5 mbpd despite the oil industry already being in "new discovery" mode caused by the earlier move from $10 to $38.
If you assert that the oil that came online from 2000-2004 came from previously discovered wells then shouldn't any discoveries from 2000-2004 be coming online from 2004-2008? Exactly how long do you think these projects take? Even the oil industry doesn't expect these projects to take much more than 5 years so many of these projects should have become visible and feeding the global total production stream, yet global production only rose by 1.5 mbpd.
Total new production over the last 4 years that came online approached 15-16 million barrels per day. Yet the total increase was only 1.5 mbpd, and most of that was this year, the year that "experts" told us we would be awash in new oil, only to see the oil megaprojects fail to give us an actual increase.
I suggest you read the Robelius thesis as well as work done by others on the problems associated with depletion and decline. You may wish to broaden your exposure to those topics.
Greyzone,
A concise and well-reasoned argument. Any meaningful response should include a sensible counter-argument supported by real numbers and verifiable facts. Do you think we will get that?
The thing about faith in technology is, it's worked pretty well over the last ten thousand years.
Times change of course, but the burden of proof is on the opposition.
Also, with regards to increasing population growth, I have not seen any projects which don't have it leveling out? That has already happened in the developed world.
This is a typically white-swan anthropocentric view, that technology and faith in it have worked out well.
It misses all the black swans.
Technology didn't work out well for the Zulu at the Battle of Blood River, or for the Native Americans, for countless past slaves, for countless current wage slaves, for the species extinguished, for the poor, for those who contracted diseases of myriad types as a result of overpopulation, for those abused by the legal system, rendered brain-dead by the media, manipulated by religion, or terrorized by their own governments.
Technology has allowed our population to overshoot its carrying capacity, and there will be billions suffering in the population crash.
Our real-world implementation of the over-Platonified ideal of "Technology" has brought about some incredible things, some horrific things, and some incredibly horrific things.
Gail, a perfectly balanced life, accompanied by an ideal set of priorities will be severely tested in times of day to day survival. Ideas of what's right and wrong tend to fly out the window, replaced by 'how can I get sustenance right now'.
Should be a wild ride, however I think the best approach is the following prioritization:
A. Have plenty of cash in the bank to begin the downfall to stay in your domicile as long as possible, to supply fuel for tranportation and for ever more expensive food.
B. Store away a minimum of 6 months of canned and dehydrated food, and have a non-electrical way to cook it (for when the power goes out).
C. Make sure you have a reliable source of drinking water or store as much as you can.
D. Store a hundred pounds of seeds for growing crops after the fall.
E. Arm yourself for when marauders come a knocking.
F. Have a short wave radio to stay in contact with news information from around the world.
G. Live to see a post peak oil world, Cuban lifestyle and then make the best of it. Trade crops with other people. Build small Kunstler type communities - survive!
If you don't have it built into you psyche that you have to live to be 100, you can perhaps back off on some of those steps. You can shoot one marauder, but I don't think it is really a long-term solution. You can't stand around with a gun all day long, working in your field. Maybe we have to accept that our life expectancies are likely to be shorter--also that getting along with each other needs to be a priority.
Hi Gail: Always appreciate your posts. Re 100, I have met people that lived to this age and IMO it definitely isn't all its cracked up to be-it is surprising that so many have living to 100 as one of their goals.
Thank you, Gail, for your thoughtful, evocative post. I have long admired these qualities in your contributions to discussions at TOD. This post also has the dialogical tone that I have also associated with your work. Your posts are invariably tightly conceived and succinctly expressed; but you always seem to leave room for your reader, to invite him or her into the discussion. That is not only a very nice, very civil approach. It has survival value.
There are several things you mention as valuable in this post--friendship, cooperation, non-attachment to "stuff"--which seem of inestimable value in any life circumstances, especially in periods of physical scarcity such as we are headed for.
We humans are, above all, a social species. Despite our having killed over 100 million of our own kind in the wars of the last century, our strength remains that we are a social species. Our languages, our cultures which evolve too, especially our knowledge and natural science: these are all powerful social tools. They can all be used by individuals, of course, but they are all, in the beginning and in the end, social phenomena.
Therein is a basis of hope, in my estimation, for our future as a species. Who knows what the future will look like, and I certainly don't deny that the livin' won't be at all as easy in the years ahead as it has been in this (couple of hundred year) summer of our energy profligacy. We will definitely need to change a very great deal about our dealings with one another if we mean to take full advantage of our social nature, but perhaps we can do that before it's too late. Needless to say, I hope so.
Finally, Gail, I appreciate your sharing your spiritual values and a glimpse into your church's life. I must say that your congregation sounds relatively enlightened. I have practiced Zen Buddhism quite seriously for almost twenty years now; and while my local Sangha (the community of those practicing the Buddha's Way) perhaps is (at least, purports to be) less attached to "stuff" than many in our culture of conspicuous consumption, not all of my Dharma brothers and sisters appreciate what the impact will be of the peaking of oil and other physical resources. Recently, when I expressed concern about building a big new building in our dodgy economy and given the impending scarcity of petroleum and other natural resources, I was characterized as the Voice of Doom.
Oh well, the voice of doom does not, as we know, necessarily speak falsely. Be that as it may, if we mean to say things our friends and associates (in all areas of our lives) can hear, we need to speak as wisely and compassionately as we can. That is what I have always heard you doing, Gail. Thank you very much for that, if for nothing else. And you certainly have given us all much more than that!
source: NIST
source: Gasbuddy.com
September 15, 2008
Plantation [pipeline] is currently delivering about 60 percent of its typical volumes, although 100 percent capacity is available. Several of KMP's Southeast Terminals in North Carolina, South Carolina, Mississippi, Georgia, Tennessee and Virginia are experiencing tight gasoline supplies as a result of reduced refinery supplies. Diesel and jet fuel inventory levels generally have not been impacted. Plantation does not own refineries or refined products.
http://www.oilandgasonline.com/article.mvc/Kinder-Morgan-Assets-Not-Sign...
Thanks. Coverage of the gas shortages has kind of gone by the wayside, with all the other things going on. I live in the Atlanta area, which is a "red state".
"Lines are back up and running at reduced rates," said Steve Baker, spokesman for Colonial Pipeline in suburban Atlanta, which normally supplies 100 million gallons of petroleum products a day to the South and East Coast. "We've got power and staff at virtually every facility of ours. We're just ready and taking advantage of the supplies we can get on line."
Baker would not disclose the level of flow since the disruption, nor speculate Monday night when conditions would return to normal. He said Louisiana refineries are just now recovering from Gustav, "but Texas refineries are still a ways from giving us new barrels."
http://www.wsbtv.com/news/17488997/detail.html
I've read rumours of refineries getting back to normal, but the DOE stats tell a different story:
FYI, somebody had previously posted this link to a daily sit-rep for refinery and pipeline issues. Noodle around the site and you can easily find the latest as it pops up.
Beingtime-
I appreciate your comments! Thanks!
Beingtime - I am very interested in Buddhist responses to peak oil! I send email to you gmail account, maybe we can get a dialog going on that.
Do you know Joan Stambaugh's work - nice bridges between Dogen and Heidegger!
Check Joanna Macy's site at www.joannamacy.net. She is a Buddhist teacher who has appeared with Richard Heinberg and has a lot to say about how to approach the various environmental crises.
Emphasis mine.
Very interesting! I hadn't seen this. Thanks for posting it.
The problem with apocalyptic theories is that they almost never happen. Its so easy to be pessimistic, and vastly more difficult to wrap your mind around the fact that humanity has been chugging along quite nicely for quite a while now. History and television teach us mainly about all the bad things that have happened, but very little of the good.
We live in a world of "A therefore B" rarely taking the time to consider whether that is true. We demand crystal balls to see into the future when, in fact, we have no idea what tomorrow will bring. Neither is it within our power to determine what that will be, though we try mightily.
We were all convinced beyond a shadow of doubt that we would soon run out of oil. Instead, the world economy is collapsing and oil consumption is dropping dramatically. Many of us were correct in that the global economy was not sustainable, but for the wrong reasons. It was actually global finance that couldn't be sustained.
A great convolution of history is now underway and new a world order, or era in history if you like, will evolve from it. We will make our predictions yet all will be wrong. One event builds upon another and we have zero capability of seeing beyond one or two events. We are like squirrels in the tropics storing nuts for a winter that never comes.
"....humanity has been chugging along quite nicely for quite a while now.."
And no doubt, humanity will continue to chug along long after the oil is gone. But most people are concerned about personal survival. Survival of humanity does not guarantee your (personal) survival. And most people want to do more than just survive; they don't want to end up poor, unemployed & uninsured standing in line at the soup kitchen.
Peak oil will eventually impoverish or kill most people. Humanity on the other hand will continue to chug along.........
And no doubt that dinosaurhood kept chuggin along after those first few pesky meteors appeared.
If you've read The Black Swan (by Nassim Taleb) you should be familiar with the "fallacy of the narrative".
The human brain likes to latch onto convenient stories, even if there is no logical basis for the stories. Consider Tom the Turkey's story. He's made it through 2 Thanksgivings thus far with no problem. So why should number 3 be any different? History "always" repeats itself (cough cough).
One thing is for sure, either humanity will make it through peak oil or it won't. (Have you thought about the possibility of nuclear Armageddon as nations fight over the last few drops. People kill each other at gas stations. So why not nations at the last gasp oil field?)
The Black Swan is a great book and I highly recommend it. But I disagreed with his characterization of the "fallacy of the narrative". He might as well called it the "fallacy of using words".
Narratives are a type of technology, and as such their implementations may have both beneficial and detrimental consequences. Narratives may be factual and unconvincing (like this one I'm writing here), they may be deceptive and emotionally manipulative (like some trolling around here).
We're all to some extent searching for our own factual and powerful narratives to spread, and avoiding the deceptive and unconvincing.
Narratives are a double-edged sword. Just as the Salvation of Technology can be over-Platonified, so can the Fallacy of the Narrative. The implementation matters.
History refutes you. Many collapses in the past, many die-offs.
Cheers
My long time advice, which I started outlining about two years ago, resulting in the following April, 2007 essay:
http://graphoilogy.blogspot.com/2007/04/elp-plan-economize-localize-prod...
The ELP Plan: Economize; Localize & Produce
Monday, April 02, 2007
Very interesting trade today in energy complex. Most of the energy stocks were down big and closed up big on volume - same happened thursday and friday (yesterday was bloodbath). Three of four days with good closing setups like today is usually a reversal signal - and happens before the commodities move because they are more liquid...(e.g. XTO traded $1 billion worth today)
Distillate was down only 2.5 cents while RBOB was down 12 cents. This tells me that gasoline demand is plummmeting and indeed todays mastercard report showed gasoline demand down for 21st consecutive week. I was struggling with how RBOB could be down SO much and it struck me that gas station owners have choices to buy cash gasoline at $1 plus above futures and get accused of gouging or just ration/shut pumps down so as to not lose money. (but they will then lose money on cupcakes and ding-dongs etc.) But diesel is another story - we are a LARGE exporter of diesel and increasingly so - I believe last year we exported 300k barrels per day and that is over 700,000 this summer. (One possible explanation for the run to $145 was that finally was the price of pain to foreign buyers of diesel). So it would seem, (based on one days trading), that the price elasticity of diesel is much lower than for gasoline, and a good deal of this comes from abroad. I will be curious to see how much gasoline was shipped here ahead/during the hurricanes...
One thing I will note - if RBOB is right and gasoline demand is really going to drop that much, then some retail and gas-station stocks are about to see less traffic...
Hard for purchases of gasoline to be up for the week with supply restricted-I wouldn't term that demand plummetting. The retail price of gasoline week over week is a more reliable gauge IMO.
Retailers hope to get more gas; price gougers targeted
Times-News Staff Reports
Published: Tuesday, September 16, 2008 at 4:30 a.m.
Last Modified: Tuesday, September 16, 2008 at 4:44 p.m.
Gasoline should be on its way to Western North Carolina in the next few days but a stable supply — and lower prices — may be seven to 10 days away.
http://www.blueridgenow.com/article/20080916/NEWS/809150225/1008/sports&...
Last Updated: 6:00 pm | Tuesday, September 16, 2008
Gas shortages caused long lines Monday at this Shell station on Liberty Street. At a Hyde Park Shell station, frustrated drivers rolled down their windows to negotiate with each other for a spot at the pumps.
http://news.cincinnati.com/apps/pbcs.dll/article?AID=/20080916/NEWS01/80...
Yup-demand is plummetting alright-I guess that explains the NYMEX gasoline price.
I stopped at a local gas station on the way home and asked the driver of a gas tanker truck about gasoline shortages, and he said, "Oh yes, this gas comes from Texas. Alot of places is running out". The gas station was in Metro DC area.
Then of course I'm driving home from this and I hear some oil industry critter on the radio saying gas prices will DROP 60-80c over the next two to three weeks. Yeah, right. Spare me. Two critical pipelines are at reduced capacity, the futures market is in backwardation, truckers are saying there's shortages, yet cash prices are gonna drop. I want whatever this guy on the radio was smoking.
Anyway, If you live on the Eastern Seaboard, I suggest you top up your tank, because I have had two gasoline truckers tell me to my face that there's shortages, AND
1) Colonial Pipeline is still only at 75% capacity
2) Plantation Pipeline is only at 60% capacity.
One would think so, but it is not the case. Gasoline stations can restrict how much they sell and also show a higher price - but meanwhile overall system demand could be down. For example, if you owned a gas station - just buy 1/2 as much fuel as you usually do so you don't lose money and charge your customers what you paid for it. This will show up nationally as gas pumps being empty at sky high prices, but actually less 'demand' than the prior week. Indeed, today Mastercard released this:
While I agree with your basic premise, society and values in the US are unique for a number of reasons.
Not only are demographics very diverse, but there has been a forcible attempt at integration resulting in a massive lowering of standards in every walk of life.
The result is blowback and a population with dual values and standards, one used within our own group of friends and family, and another dog eat dog style towards society in general. Look at people driving or even in general situations when they think they can't be touched, and look at them again when they realize that they have to deal one on one. In most other places people are much more courteous and show much more respect for strangers.
Eventually the only way we can live in peace will be in small localized societies where people do not externalize their liabilities.
Look at it like the football draft, a bunch of lightweight 150# wannabe running backs are useless, we have to create new communities from scratch.
The value of a bank account isn't so much in the leisure it buys, but in that it is a tool that allows to prepare. Eventually it will be gone one way or another.
How very refreshing to read such an intelligent and heartfelt article. Gail's perspective is striking both for its simplicity and its depth. Ultimately, as she says, all our problems arise from an inability to conduct ourselves with the kind of dignity she advocates. All I can say is "hear hear".
Gail - interesting article.
I too was raised to help each other and be there for my family.
Too bad we cannot get the majority of our country's population to act like that. Everyone is out for themselves. Nobody wants to take a step back and give up their experience of being pampered in a fine automobile or a large air conditioned house or being served at a nice restaurant. They feel like they Deserve it for whatever reason. It's too bad. They usually are also the ones that are less able to take care of themselves, they are people that get others to do things FOR them, not WITH them. At least that's been my experience. Too bad.
This country has been following a sad road over the last several decades. More people than ever are growing up not only under-educated but less capable of taking care of themselves than their predecessors.
When oil is in short supply and they cannot fill up their Mercedes Benz, Lexus or BMW, they will be whining the loudest.
All though the economy is low, and soem items are getting more expensive....It's no where NEAR what our grandparents went through
in the great depression.
It's just bad times. It's not even a recession.
Stop crying about it. It's a bump in the road.
The market goes up and down all the time.
Think of it like this......When the market is REALLY down...
like losing 500 points in one day.....It just means
that it's a clear signal to buy cheap stock that you couldn't afford before!
Be happy.
*Think of it like this......When the market is REALLY down...
like losing 500 points in one day.....It just means
that it's a clear signal to buy cheap stock that you couldn't afford before!
Really?
What about the venerable Wall Street adage : "One hundred thousand lemmings can't be wrong."
TOD works best discussing what has happened and why. Prediction is a mug's game. Eventually we will all die, true enough, but a bald statement like that isn't exactly useful. And if you want cheerful helpful neighbors you need to be one first.. Lead by example or sit back and be critical.
Oh sigh! Perhaps you missed the point, Positive_Phototaxis, I wasn't predicting disaster, I was merely observing that scarcity is an economic concept that relates to supply and demand. Supply is finite, though other sources of supply can be found; demand is is more flexible, going up or, less frequently down, relatively quickly as non-price variables change. Population increase is a powerful determinant of demand change; the changed expectations and tastes of an increased population are even more likely to see an increase in demand. Modernity, as it has existed since, the 1750s, has rested on the use of fossil fuels; the world's population has increased seven-fold in that time, a relatively short one by most measures of human existence. My point is, it is a very short historical perspective on which your, and you are obviously not alone, optimism rests. Demand for petroleum, in my view, is going to increase over the few remaining decades of my life at a rate faster than the supply can grow. This phenomenon, unless there is a way to defy the classical laws of free market economics, will mean higher (probably significantly higher) prices for all petroleum (and petroleum-based) products in the middle and long-run. I, too, make no claims to being able to predict the short-run situation (other than, perhaps, to suggest that volatility may be the norm for some time to come); in the longer run, unless our entire political-economy, and the social and cultural norms on which currently rests, changes, those higher prices are going to create some profound challenges for oil-dependent industrial economies with large (even if slow-growing) populations. I welcome Gail's invitation to consider a more self-sufficient, less materialistic (in the consumer sense) way of living as an alternative measure of well-being in these troubled times. I also appreciated the invitation to reflect on a zen of using fewer resources; desire and demand are closely linked concepts.
Also "cold fusion," now that's a techno-fix if ever saw one!
You can call me a lurker.
Been a lurker for a while and just reading and trying to understand everything. Can't say much about the financial system and what the fix is since I don't have a clear understanding as yet regarding financials.
I can't escape the thinking though that it's so obvious we're living beyond our means as individuals and as a society and that resources are being pounded to support our lifestyles.
It seems a foregone conclusion then to assume that we're going to hit a wall at some point and then nature will force an readjustment of how we do things. To ignore this just invites a nastier future.
But in the dumbing down of our entire population, I don't hold out much hope.
You look around and see the self-entitlement of the average person and it's hard to fathom people coooperating as we did in the past when things got really rough.
And to add my opinion to the possibilty of us getting off our little planet and terraforming elsewhere? Not going to happen.
We're too selfish, too warlike and self-destructive and clearly not capable of planning such extreme longterms that this reality will never happen. Or very unlikely.
Even if we were to get off this planet, we would only take our problems and idiot behaviour elsewhere and it would start all over again.
Now, if we're talking about sending machines into space............... That's a whole new ballgame.
As for PO?
This only makes sense to me. Limited resources combined with continous and increasing demand means hitting that wall sooner or later. And since we don't like to do something until the shit hits the fan?
Thank you Gail for this uplifting and thoughtful post. When I talk with my friends about the challenges we're facing, this is how we feel, or at least want to feel.
We want to be thankful for the simpler joys in our life, join together as women to help each other and help our families. And work to focus less on what we may have lost and more on what we still have.
You are the kind of person I would want near me as the crises unfold.
That's very clever Gail. You have touched on so many points that are fundamental to our Western problem;
Each of us has a Time, Societies have their Times, Solar Systems too. But what is Time but Always Now - The Eternal.
Who are we to deny the possibility of unseen dimensions beyond our limited perception as tiny specks in a very big Universe. The God Delusion by Richard Dawkins, a great book, the only thing I disagree on is the title.
Yes, let's enjoy every minute.
I'll get flamed for this but anyway!
Age of Aquarius circa 2015 - End of Mayan Calander 2012 - Peak Oil downslope circa 2010 - Peak Cash 2007
Prohesy from Book of Revelations, well if the cap fits wear it,
Peak Phospahte - circa 2010. Global boiling circa now etc
Jeff Vails ideas about rhizome, I've been thinking along similar lines, It may be a good exercise to start planning a new sustainable society on paper (hypothetical models) JUST IN CASE.
The Australian Dollar is plunging into oblivion, glad I spent it all on manure and fertilizer etc.
My Wife and I are slightly insulated from financial turmoil, we are medical workers but Perth Australia is in recession according to several friends who have businesses, It's a weird feeling driving down the freeway and realising that it probably will be half deserted in ten years. Western Australia has tons of resources as well, we had a major gas pipline blowup about three months ago and that knocked the state around a bit, it is still only partially repaired.
The place has been having moments when the streets are completely emptie eerie, Our Indian Curry Man at the foodmarkets has shut up shop after 10 years, it's too quiet, We'll miss those red hot vindaloos. We just happened to go and get a curry on the last night he was open and he gave us all his shop crockery, isn't that nice, a simple act that gave all of us more pleasure and connectedness than we ever got from the meals provided and consumed over the years.
I'm optimistic, despite the challenges ahead, besides, I want to stick around just in case there is divine intervention, that would be hilarious.
Nice. Thanks for mentioning that.
http://www.jeffvail.net/2007/04/rhizome-theory-posts.html
http://archive.rhizomecollective.org/virtualTour.html
Though as a scientist I can appreciate the beauty and simplicity of the design of this theory, I have some criticisms of it.
1. It seems to be a theory designed to fit "back to the basics" where we all lived in smaller communities. This is desirable to many people in the peak oil community for a variety of reasons. Unfortunately, fitting the theory to the desired outcome doesn't mean the theory predicts reality.
2. It is ignoring that human society follows a power law.
Super nodes are part of nature.
3. It is ignoring the tenet "might makes right".
How does the theory propose to make sure an enlighted group can successfully (and on a continual basis) defeat a non-enlightened group in warfare.
This question is in fact the very dilemna we face right now:
How to get our warlike leaders to NOT blow us all up fighting over the dregs of oil instead of trying to grow a non-oil based civilization.
Nice theory and nice math though.
1. We are going to lose 80% of the population in 20 years. Starting with Nile virus, starvation, civil disorder etc.
2. Correct, I'm sure the hypothesis could be modified to include supernodes. Possibly the places where we maintain positive technologies, eg medicine (scaled down), and knowledge bases(I have not studied it in detail)
3. Ask Nate, something to do with training everyone to control spontanious firing of the amigdyla - Radical changes to the education system starting at age 4 or sooner. The enlightened group can just get very good with archery and axe, same as it ever was. Hopefully a trial of attrition might satiate our lust for violence.
Hi Lucifer,
"It may be a good exercise to start planning a new sustainable society on paper (hypothetical models) JUST IN CASE."
Check out the 'Transitions' initiative: http://transitiontowns.org/TransitionNetwork/TransitionInitiative
At least its a good idea on 'paper'...
L,
Sid.
Thanks Sid
How is the financial turmoil affecting you?
Decline in value of my 401k is the most immediate impact. Otherwise, not much. Own my house and a 4plex rental mortgage free. Also have two housemates which produces a nice under the table cash flow. I live in Eugene Oregon where it's a landlord's market for rentals due to the UofO, and we also have very reasonable utility rates. Just installed solar PV and hot water. Our latest monthly utility bill was $63 for a four member all electric household, including water and electricity. We've already laid in 4 cords of wood for winter heat.
What is your view of how we should be reacting to the news?
Hard to say. Probably best not be selling at this moment. There may be bargains available if you can stand the risk and are liquid. I've gotten a lot more conservative over the last two years in regards to investments. Have purchased silver coins as a backstop against total currency devaluation ala "World Made By Hand".
I think attention should be paid to maintaining and enhancing existing assets. I have invested in my property - both improvements (solar, garden beds, greenhouse, livability remodels) and maintenance. I've spent more maintaining my hi mileage hi mpg 1990 Geo Metro than I paid for it: $1,000. Also invested in education: permaculture certification, master gardener, master food preserver, and community: active member of neighborhood association, started neighborhood micro-community, etc.
Sounds like you are doing well! Thanks for your comment!
(originally posted on another thread that turned out to be dead)
TRYING TO MODEL THE LONG VIEW
I am asking more than commenting, trying to "model" what is happening in the economy in my own mind, so bear with me:
In the boom days, only a few billion dollars could be used to guarantee hundreds of billions. Just today I saw a statistic that showed that the FDIC had only about 10 billion dollars on hand, but it is the insurance for possibly 5 trillion in deposits.
When things are going good, that’s fine because there is very little risk of much going wrong at the same time. But when things turn bad, a lot can happen at once. What was formerly considered respectable cushions in the case of unexpected events is now seen as completely imprudent. Credit ratings agencies who viewed a bank, insurance firm, brokerage, etc. as perfectly sound a few years ago suddenly begin downgrading the same companies, even though the company may still have the same margins of error now they had then. The business press which had been perfectly comfortable with the firms contingency funds a few years ago now turn against them. The firms are accused of “incompetence” for doing exactly what they had been being praised for only a few years earlier (“you can’t expect to make money if you leave money under the mattress, you have to have it out there in play, earning money…”)
This makes the investors nervous. They pull in their horns, and take money off the table. They reduce leverage, pay down debt with any spare capital. Many of them had made fortunes in the 1980’s and ‘90’s anyway, so they can afford to sit off to the sideline on cash and bonds and wait. This creates financial gridlock, a sort of coma takes over the economy. The money is still there but it is parked.
The question is, wait for what? The assumption seems to be that the investors (and all of this applies to both institutional large investors and small investors) will come back into the equity and “risk” markets when (a)confidence is restored in the economic system and (b)they view stock/equity/asset prices at absolute bottom price. This is the so called “blood in the streets” investing tactic.
For the average investor, the question becomes, how will we know and how low can it (asset and equity prices) go? What sign will tell folks that we are at bottom?
It is almost impossible to predict. After the 1970’s recession (which should give us some indication as to how long the downturn can last, as stock and asset prices (“risk capital”) failed to grow for almost 12 years, while “safe” bonds and cash grew in some of those same years by double digits), the rebound in the markets came almost completely without warning. In 1982, equities and other risk investments began to grow, and did not look back (except for the short downturn in 1987) until 1999. It is to this date the longest running bull market in history and it came completely without warning. In fact, it came against almost all opinion and advice as “The Death Of Equities” was the mantra of the day.
But for those who were there, who had the nerve to buy early and buy as much as possible, it was rewarding. Fortunes that changed lives were made. Ray Kroc, the founder of the McDonalds chain once said when asked the secret of his success, “You can get it wrong a lot of times but you only have to get it right once.”
But to be fair, fortunes were also lost in miscalling the markets. It is called “risk capital” for a reason.
So as the kids always ask from the back seat, “Are we there yet?”
There is no way to know. I predicted earlier this year that we would see the Dow at 9000 points before I would consider coming into the market hard (with certain possible exceptions) and will stay with that prediction (based entirely on gut feel and a little bit of history). I am also of the view that house prices are NO WHERE NEAR low enough yet. In many markets in the country they have dropped very little. As to oil, I guessed a floor of no less than $100 per barrel for this year when many were betting it to go to $200 per barrel, and I may be wrong on that one. Oil at below $90 per barrel strikes me as insanity given the world situation, but who knows?
As I said at the start of this post, I am trying to model the future and decide what to do, and for now, I am playing the “safety” angle, bonds and bond funds, and pay down the debt, in other words, I am one of those parking my money as much as possible. I may not win but at least I can’t lose unless I am completely wrong and miss a fast turn upward, in which case, I will have been too conservative once again. It won’t be the first time, but like so many baby boomers, time is becoming a major factor for many of us.
RC
I think the problem is your so=called safety angle really isn't safe. Bonds are going to have high default rates, if they don't have already. We don't have any good paper investment options left.
Gail asked, "Are thre financial news items other readers might be interested in?"
Yeah...
http://www.bloomberg.com/apps/news?pid=20601209&sid=aCLWVDLr_HN8&refer=t...
What do ya' know, looks like the Chinese "exponential growth" train may have hit a wall...
Things are tough all over.
RC
Also, I am sure you have heard that Russia is having well, at least in part because it cannot roll over its loans. Probably also because oil prices are below the cost of production. The stock market has been suspended until further notice.
Russian Stock Exchange Suspended
Gail,
It is mooted that resources decide the political system.
Too many people too few resources leads to communism (not Stalinism or Maoism)
Moderate resources but still limited, leads to socialism. (not Fascism)
Abundance and surpluses can afford democracy, but not uncontrolled, rapacious, Reaganism.
The US will go back down the scale to a US form of communism when the population again exceeds the available resources. A modification of feudalism is the last step down.
Strangely the entire century of the US fighting Communism was wasted because it was never a viable threat if the governments had decided to spread the trickle down fairly. It wasted the money it should have given its people on fighting its phantom, the ultimate self fulfilling prophecy.
In my opinion Terrorism is economic Blow-back to uncontrolled Capitalism, more than it is religious fanaticism.
Our generation had it all and squandered it.
Graham
Interesting. I hadn't heard that before, but it generally seems to make sense.
I would agree that Terrorism may be a blow-back to uncontrolled capitalism.
I would agree that Terrorism may be a blow-back to uncontrolled capitalism.
Gail,
I can't agree with that. Terrorism as a means of executing (no pun intended) political priorities goes back many many centuries before capitalism existed in anything like the current form.
You can choose whether or not to associate it with Islam (radical or otherwise), but that area of the world (the north coast of Africa over through Persia) has used it for many centuries.
"You can choose whether or not to associate it with Islam (radical or otherwise).."
Boy, you're on a roll today.. It sounds like you've chosen the above association, anyway, while clearly there are all sorts of examples from around the world, from most if not all peoples.
So what is a good definition of Terrorism? (Sincere question to anyone.. just a snarky start.)
Are Church-burnings and Jim Crow and Poll-taxes a form of Terrorism?
Were the Guerilla tactics of the American Revolutionary Army effectively a form of Terrorism usurping the age-old rules concerning warfare?
Is it terrorism when a country does it? Or a private company? When it only destroys private property (Eco'Terrorism')? Or when it's a Hate-campaign in the media and parades, intended to intimidate and belittle an ethnic group, gay-community or religious population, but actually never uses force, just threatens it?
What is it, and what ISN'T it?
The State Dept. uses:
So yes, lynchings etc. are "terrorism". But frankly, virtually any terrorist act is also a violation of at least one statue already. So it really seems as if terrorism is word used to tell people that the crime was especially bad, and committed by people whose politics 'we' don't agree with.
Not to pick on Israel, but when a Jewish settler kills a slew of Arabs in a mosque, western media consider it a heinous crime, but if a Palestinian blows himself up on a bus and kills a slew of Israelis, it's "terrorism". They are both murder, and murder which is "politically motivated" and done to "influence an audience".
Premeditated State violence against noncombatants is not terrorism by this definition. The Nation-State gives itself a "pass"! The Nation-State makes laws and agreements with other Nation-States confirming that they have a monopoly on violence. Sadly, while the Nation-State is very good a killing people in job lots, it really does not have a monopoly on violence. So the State can kill oodles of people, even it's own citizens, and it's not terrorism; and only becomes genocide if a genuine attempt is made to kill most everybody.
Seems to me that terrorism is a word that hides at least as much as it explains; I think we should discontinue its use.
As people have sought a useful definition for it in the last few years, one I heard was 'Terrorism is the Privatization of Warfare', which has its merits. Blackwater can make of that what it will.
Frankly, anyone using violent force to get their way, who doesn't have the 'validation' of a Sovereignty or Big, Old Money behind him runs the risk of being labeled a Terrorist. A state-actor can bomb a village or a school, and achieve something or nothing with the action ,justifying it as they will. Their reporters and historians are, to some degree, forced to accept the definitions offered to them. Meanwhile, the fighters in Niger (MEND) have been granted the status of 'Militants', which resides in the shady areas between Terrorist and Soldier.. but clearly closer to 'Insurgent' than to 'Freedom Fighter' in its implication at this point.
Words matter.
I don't quite get why some people here refer to Blackwater employees so negatively. If the Army hadn't downsized and outsourced so many critical functions, the Blackwater duties would mostly be Special Forces roles, and the rest is private security (which is a world-wide need in any case).
The few Blackwater people I know are far more cognizant of the frailty of the veneer of humanity than most, but are eminently human, and I guarantee you that most are not blood-mad crazies looking for a fight anymore than your average Nat'l Guard soldier or police officer. Shouldn't everybody consider personal and community security a reasonable element of a crisis plan, and who better to have as part of your community to serve that role?
Personally, I have nothing against Blackwater employees, although they should be aware that people are judged by the company they keep.
But I do have serious concerns about private armies (and Erik Prince is no...um..prince). The fact that Blackwater and Caci etc. were allowed to operate in theater while not being constrained by the UCMJ should give pause to any citizen concerned about constitutional government. That Blackwater was allowed to operate in a quasi-military fashion in New Orleans after Katrina is a matter of gravest concern to me. Were you ok with that?
Consider Lebanon in 1975
I concur with many criticisms of the company, but have a hard time faulting individuals taking their skills to a higher-paying employers involved in similar lawful work. I have some concerns about rules of engagement, but on both ends of the argument, and considerably more about outsourcing key functions to somehow pretend the military is smaller and more efficient than it is. In any case, war is hell, and it will never become just a police bust super-sized.
Post Katrina was an epic screw-up in so many ways. I don't know what NOLA specifics you refer to, but from what I saw lawlessness was rampant, and at the time I expected some form of martial law to be imposed. I have to profess ignorance beyond a superficial reading of the Lebanon particulars.
I confess the ROE issues seem minor to me; that there was no legal constraint on Blackwater in theater Iraq is a matter of profound concern.
The consequences of "outsourcing" essential military functions should be apparent to any student of military history. The failure of 'military contractors" during the Thirty-years war was a major impetus for the creation of "professional armies".
As to NOLA, AFBE has a better read on the situation than I, but the use of mercenaries within the U.S. seems to be an end run around Posse Comitatus.
The breakdown of the Lebanese Army and the formation of independent militias helped set the stage for the violent sectarian conflict in Lebanon.
Paleo;
You have all the key points in your post for why I pointed to Blackwater above. (As a Privatized Surrogate Army who has apparently operated outside of US or Iraqi law and continues to do so) That atrocities are possible out of sight of the Military Chain of Command and our system of maintaining 'just war actions'. If I was demonizing anything with the comparison, it is the leadership that enabled and encouraged this model to grow, complete with the lies disguising the vast expenditures and outsourcing of troops, while our own forces struggle and face all manner of equipment underinvestment.
I'm sure there are some fine people who work in these companies.. but what they've been allowed, taught or ordered to do by now can only add to the serious concern for their moral and emotional health once their duties are done.
Be careful how many sins you allow your country to hide under the 'War is Hell' blanket. It wasn't said to justify or downplay actions that will erode our standing in the world more than has already been done. Remember, No Continent is an Island.
Best,
Bob
Paleocon,
You miss the whole point. Blackwater are MERCENARIES, which our culture brands as misfits and undesirables.
Soldiers are supposed to be fighting for Honour, Freedom and Etc., not prostituting their craft for money.
Killing for money is as low down the human scale as one can go. Killing for National Honour is the top of the scale.
To compound it the Present US wars are Dishonourable by all intellectual definitions.
The fact that the US, for financial and social reasons cannot get its armed forces manned sufficiently, tells a whole story by itself.
Vicarious killing, using surrogates, is a heinous indictment of an immoral government.
I personally see no pride or honour is the present US endeavours.
Graham
I am from israel :
Even if I will do all of this I will still be terified of peak oil since I am from Israel - and the vast majority of the worlds oil is right next to my door step, held by people who do not exept my very existence ( I am a secular jewish man... "infidel" ).
It appears to me that when resources on the wrold will become truely scarce then 6 billion people on the planet will not be able to sustain themselves - which means that many will have to "GO", in order to shrink the population - some thing tells me that my people will be the first on the list to be "wiped of the map" and I wonder why nobody on this web site is talking about the pending nuclear war in the middle east ( WHICH IS AN UNDENIABLE CONSEQUENCE OF PEAK OIL ).
Kobi Sherit I doubt your Jewish. You say you are secular in any case. Kobi, Jews live in Egypt, Iran, Turkey, Morroco, etcetera. But a Goyim isnt allowed citizenship in Israel...hmmm. Kobi, Israel has nukes and Turkey, Morroco, Lebanon, Syria, Iran, Iraq, etcetera etcetera do not. If you are really worried about the anti-semitic fish in the Dead Sea...don't go swimming there okay! Kobi, take a hint from this site and the people here who promote GETTING ALONG WITH YOUR NEIGHBORS and COMMUNITY and you won't be so inclined to kill em and steal their land...ummmK.
Now I have to sit Shiva for my portfolio...so schlep
off with your 1 hour old nic.
Note to non Jews: Shiva is like a Irish wake without the booze..or Italian without the food...or a New Orleans without the band...you get my point!
I'm not sure if it's 100% certain the nukes will be dropping, and if they do Israel is probably not on the top of the list. They will be too busy trying to get the oil to worry about ideology or a long and sordid history. You know sometimes in the depths of struggle bitter enemies can forget their differences in the fight to defeat a common threat.
Who is going to nuke you, name a nuclear armed nation that would do that. The main oil fields are well away from Israel.
History and Fear may be your greatest threat.
Shalom Kobi,
Just the other day someone on TOD assured us that the human race would keep "chugging along" despite PO because it always has.
I noted that nuke war might be a Black Swan that upsets that warm, fuzzy but nonetheless false narrative.
If Israel goes out first (i.e. thanks to Iran) it might be a blessing because the rest of the world is going to have a prolonged and painful "On the Beach" experience soon after.
Here in the USA we are very happy that President Palin will be in control ("Mommy, what's this red button? Can I push it? Oops I did.")
It's Israel that has the nukes.
... and yet, no one is worrying about Israel embarking on a nuclear jihad against its neighbors.
... p.s. It's the USA that has the nukes too. It's the French that have the nukes. Do we smell a double (and anti-s) standard here?
and yet, no one is worrying about Israel embarking on a nuclear jihad against its neighbors.
No, such gets expressed.
Just not in America's Congress or in the mainline press.
Shalom :)
"Chugging along" ?!?! I don't think so.
I heard Sarah Palin talk and I think she is unbelievably charismatic ( John Mccain is not even remotely close to being charismatic though ) ; None the less I can say the same thing about Obama too. The problem with repoblicans is OIL, they yeild to big oil too much. The problem with the middle east is OIL. The problems in Georgia ( and the Russian invasion ) is oil. the problems in Sudan ( genocide in Darfur ) is oil. all of these various issues are merely by products of Peak Oil.
You want to spread democracy around the world without firing one bullet - reduce your consumption of oil!
You want to diminish terrorism - reduce your consumption of oil!
You want to rack up pressure on the Sudanese goverment to stop the genocide in Darfur ( 300000 people slughtered so far ) - reduce your consumption of oil!
You want to keep your soldiers in Iraq safe from harm - reduce your consumption of oil!
You want to prevent a nuclear war in the middle east - reduce your consumption of oil!
You want to get your economy out of truble - reduce your consumption of oil!
DRIVE AN ENVIRONMENTALLY FRIENDLY CAR !! OR BETTER YET DON'T DRIVE A CAR AT ALL !
I go to work on foot or on my bicycle every day, trust me it keeps you in great shape and saves a lot of money - I rarely use my car. people just don't seem to be able to connect between what they do on an every day basis - to what they see on the evening news.
Seriosly now think about it - lets say that every citizen in the USA would reduce his oil consumption by say 20% ... you can forget about a recession.
The US spent 87 Billion dollars on the war in Iraq - try to imagine how the middle east would have looked like if that money would have gone to alternative energy sources inside the borders of the US.
Think of all the people who go to an anti-war-in-iraq-demonstration driving an SUV without even understanding the hypocrisy in it.
If I can convince one american to change his own ways - I would be proud of myself ( that's why I wrote this terribly long response ) - I hope I convinced you.
ON AIG from CNN
HELLO DUMB-DOWNED AMERICANS! ANNOUNCEMENT: THE 'FEDERAL RESERVE' IS NOT 'FEDERAL', NOT UNDER THE JURISDICTION OF, OR FORMALLY PART OF, THE US GOVERNMENT. IT IS A PRIVATE BANK IN CHARGE OF OUR MONEY SUPPLY. LEARN ABOUT THE FEDERAL RESERVE.
Hi Stiv,
And as has been pointed out before, possession is nine-tenths of the law, once you have possession you can dictate the law and have the potential to do whatever you want. In this respect it is the possession of power over others.
L,
Sid.
Its Deja-vu all over again. I wrote about this just several days ago and will reiterate (Iam married, so Iam used to the repetition) The Great Depression actually started on a single day in Oct 1929. The markets "wobbled" ever so slightly. The next trading day saw the losses extended. The big boys tried to "shore up" the system and "reinstill faith". This tactic seemed to work as intended...for a entire day.
Then the bottom fell out! So weather you peg the beginning on Black Thursday Oct 24, 1929 or the following Tuesday, October 29 doesnt matter. The real point is, its happening now, exactly as it happened then. The "big boys" have stepped in to shore things up, the markets respond with a "dead cat bounce" NOTE
(dead cats don't bounce well) When the gov comes in and grabs 80% of AIG or bails out Fred and Fannie...
Its apparent the theater is on fire. The people who built, manage, produced even the movie playing on the screen, are the same people who started the fire and now scream FIRE in this crowded theatre.
I hate to be so cynical...(not really) But I write this about 30 minutes before the markets open on WS in NY.
As for the question "How has it affected me"? The difference between being rich or poor is, the quality of the mattress you die on or box your put in. The dirt you get buried in is all the same.
I think you are right. Problems just keep popping up all over.
Now that money markets are "breaking a dollar", every one wants to bail out. That puts pressure on the securities being sold. No one wants preferred stock of financial firms, after what happened to Fannie and Freddie. Russia is having huge problems, as it rolls over its loans. The Treasury is now borrowing money for the Fed, because the Fed is exhausting its own resources, as it keeps propping up companies. Morgan Stanley's price is down over 30%. And so on. I wonder which banks will go under on Friday.
Hello Gail,
I applaud your initiative, your activism and I dream of a time I may follow, with family and friends in-tow. However, for the moment such a path remains a pipe dream; as long as MSM remains cold on peak fossil fuels, limits to growth and other such prospects, my friends and family will not think to ask the questions I've been asking these past months.
As long as there's hope out there - that government keeps reassuring us that trillion-dollar business' can be given a helping hand, that oil prices keep falling, that alternatives and technology will save the day - I fear I'll remain part of the BAU system, a speck in a tiny suburb somewhere in Melbourne, Australia. Where leaving behind friends and family remains an unthinkable option.
So, the leaky-boat question (asked many times already, I'm sure): Is it better to know the boat's sinking, knowing no-one else on board will believe you if you try and explain; or, better to NOT know and go down kicking and screaming? Perhaps I might hang around the floating chairs instead.
I've been told there may not be many years to wait and seeing all the termoil so far this year, it's difficult to remain optimistic. It doesn't help that I just signed up my third wedding for 2010 (I videotape them for a living). So as it stands for this little poster, I think all I can do is hope that time does exist. And I'll just tuck into this bowl of processed cereal and energy-intensive milk and think about beautiful sunsets until those around me "become aware".
It's all an Average Joe can do.
Regards, Matt B
Gail is such a treasure to the TOD on so many levels, brilliant, analytical and possessed of a huge reservoir of common sense.
I appreciate your kind comment!
Gail could you send an email to me privately as I would like to propose something of possible utility to you and your family? Do I need to post my email address on line for you to reply?sorta hate to do that. H
Wow! The similarities between todays markets meltdown and 1929 are so close, like a dovetail joint. I suppose it really wasnt a huge feat of crystal ball reading to call it ahead of time.
BUT! and its a big but, this time is different in that
recovery won't be mitigated by a cheap and plentiful energy resource, LIKE OIL!
Now I would like to say a bit about the psycology of those on TOD who warned and fretted this day would come. I dont believe they will rejoice and laud it by
saying to the naysayers "SEE,I TOLD YA SO".
I believe they will be just as rattled and maybe more so...because ignorance is bliss...and TOD participants
are anything, but they are not ignorant.
Some TOD'ers might feel guilty that they didnt scream loud enough, or missed some crucial way to get the point across. Its natural of course, Survivors often feel guilty, after some tragic event. These feelings will pass eventually and the work required to carry forward will take precedent.
Good Luck.
I have been screaming at the top of my voice for a year, and I've got a loud voice.
No guilt on me.
Probably nothing new, but it's interesting to see how consistent human nature is:
Two towns - each with a lot of farmland - within 20 miles of each other. Both had made plans about the same time for 600+ middle-income residential units, plus anchor stores, plus commercially-zoned building lots, plus affordable housing units.
Town A just put a complete stop to everything.
Town B still says "we need it."
I think I'll get some entertainment out of watching what happens.... Will keep all posted if anything funny happens.
Those with loan commitments seem to want to go ahead with projects, no matter how ridiculous the projects now look. No wonder banks get in trouble!
Greg Jeffers' comments from yesterday:
http://americanenergycrisis.blogspot.com/2008/09/holly-molly.html
Also, prices are now below several producer's cost of production. Production will drop quickly, if prices don't go back up.
This point is critical and I hope Gail does an ARTICLE on this subject. The marginal cost of a barrel of oil is higher than the current PPB. As WestTexas noted, the commodities market has been unwound--at some point, this price for a barrel of oil doesn't reflect the marginal cost of production which just shot up after two back-to-back hurricanes. Sorry folks, but the price of oil futures is headed up. Look at the MARGINAL PRICE OF PRODUCTION and that, IMHO, is where you'll find the bottom after the financial markets' dust settles.
Demand for oil, as many have pointed out, is not terribly elastic. NO ONE has provided anything but piddling drops in demand in the 'West' without a simultaneous analysis of China and India. And at some point, falling demand has to correlate with the marginal cost of production. Can't someone here write something about this issue?
Thanks for the idea!
No one in this huge long topic has said anything about health - except Gail in her original post.
Well, I can tell you from experience that a garden, a nest egg, a lifeboat - none of it will be of much use if you don't have your health.
Especially those who have desk jobs need to get vigorous exercise on a regular basis. Even if a person is in shape, a wrong step can permanently disable you - even today when highly technical medical care is available to most of us in the first world you can still be ruined by a simple misstep. It will be worse in a post-oil world with limited medical resources.
My garden languishes untended, my savings drained, my food stores outdated and not rotated, my dream of buying a small farm - gone with the twist of a knee.
But I did buy some opium poppy seeds... Formerly in Health Care, I plan to be the local pharmacist post PO. ;-)
I agree. Injuries are especially a problem. I broke a wrist 18 months ago (typed posts one-handed), and also couldn't really garden. It would be hard to get treatment for such a break.
Allergies are another big problem. I have had to take Prednizone more than once to get some allergies under control. I seem to be very allergic to some plants and insects.
In the USA, there is a lot of social capital available that yearns to be productive, to have meaning connected to their toil. I think we might use some of that capital to upgrade our whole healthcare non-system by reinjecting the human element into caregiving. By moving to a single-payer system, thousands of clerks within the current system will need to be retrained to be LPNs, RNs, CNAs, EMTs, etc.; and once trained they should be dispersed to positions in areas needing betterment of the nurse/patient ratio--which is to say most everywhere in the USA. It's a travesty in a country with "real" unemployment reaching close to 13% that there is a shortage of people working on the "human" side of heathcare. Outstanding levels of healthcare can be provided with rather small amounts of energy and money as its primarily knowledge-based and doesn't rely on any sort of industrial infrastructure. And having more direct person-to-person healthcare that's socially based will greatly help the anomie generated by our many crises.
Our healthcare system is a disaster! It doesn't work to have people making money (lots of money) from treating people for their illnesses. I would agree a single-payer system would be better. My coverage is from Kaiser Permanente, which in the current way of doing things as close to a single-payer system as there is.
Hi CSS,
"It will be worse in a post-oil world with limited medical resources."
Actually the example of Cuba proves otherwise - the concept that lots of technical and expensive equipment is needed for good basic health care has been proven to be not necessarily true.
"Its life expectancy and infant mortality rates are pretty much the same as the USA's. Its doctor-to-patient ratios stand comparison to any country in Western Europe.
Its annual total health spend per head, however, comes in at $251; just over a tenth of the UK's. " From: http://news.bbc.co.uk/2/hi/programmes/newsnight/5232628.stm
One of Cuba's main exports is now highly trained medical staff (http://student.bmj.com/search/pdf/07/11/sbmj387.pdf) which it 'swaps' for other 'commodities'
And of course the change in diet of the people helped the 80's diabetes epidemic along with the massive increase in exercise which helped improve general fitness levels.
And in the UK, where one of the biggest problems has been keeping hospitals clean and prevent infection from MRSA, a recent effort to actually clean the hospitals has resulted in a drop by a third in infection rates over a year (http://news.sky.com/skynews/Home/Health/MRSA-C-difficile-superbug-hospit...).
This points to health knowledge as being more important than health material resources. I hope this helps calm any worries about a post PO world, though of course the political will will still be needed to train medics.
L,
Sid.
UP UP UP oil goes, get ready for a fun inflation ride! Meanwhile we use over 80 million bbl/oil per day. The earth doesn't care about our problems, depletion continues and will trump all of this financial crap very soon.
I think our leaders know this better than we assume. Is it out of the question to think they could be taking matters into their own hands?
Yes, they are politicians who care about getting paid by lobbyists and getting reelected, not saving the planet.
The original intent of Gail's posting was what are you all doing in these times and most of the comments ( mine included) seem to have departed from that. So I thought I'd just mention what I'm doing.
I decided that having things was better than having money so I bought some things I'd been hesitating about. Spent ~ $1000.00 to get V-Bar chains for my tractor. I live in heavy snow country in Vermont's Green Mountains so those familiar with heavy snow will understand. Bought a portable 9000 lb DC winch and receiver hitch to affix it to the tractor and informed my neighbors that I have this equipment. I invited them to call me if they get stuck this coming winter ( pretty common happening ).
Joined a coop buying group so I can buy bulk foods and not have to carry it up my mountain this winter. Sadly, the coop does not offer cases of red wine.
Bought and built a greenhouse ( http://www.catamount.org/catamountpics/v/greenhouse/ )so I can start things earlier and keep things going later. I also hope to grow some cole crops starting in Jan or so.
I bought a Dexter Cow and heifer calf so I can have milk and some help controlling weeds. The little cow is also a handsome addition to the landscape. The cow caused me to bestir myself to clear forest and plant grass for pasture and erect a shed and buy hay for the coming winter.
Will be taking the hunter safety course this weekend so I can buy a deer hunting license. I recently had Venison Wellington and found that a powerful incentive. Also, a deer in the freezer will help with the food budget.
Discovered that there's trout in my beaver pond and will be after them shortly.
Neat Greenhouse! Where did you get it? And if it's not too nosy, how much did it cost you?
Cool stuff, you're doing exactly the kind of thing I think people really do, and certainly everyone one that gets on the bandwagon encourages others to move towards a sane and sensible future.
Here's my current project in Hawaii.
http://sanityandsimplicity.blogspot.com/
Very nice.
1 Photo Dates are all 9/16.. is that just when you downloaded the pix, or did you raise it in a day?
2 That French drain, if it stayed below frost-line far enough could bring in 45 degree air for you, winter and summer. What we did up in Stoneham, Maine.
3 Winter Crops. Have you read Eliot Coleman's '4 Season Harvest'? What are you going to grow?
Bob