Feed aggregator

Eight Pieces of Our oil Price Predicament

Energy Bulletin - 24 October 2014 - 12:50am

A person might think that oil prices would be fairly stable. Unfortunately, it doesn’t seem to work that way recently. Let me explain at least a few of the issues involved.

Categories: Peak oil news

Letter to the PM outlining how 2°C demands an 80% cut in EU emissions by 2030

Energy Bulletin - 24 October 2014 - 12:25am

The letter summarises why the IPCC’s carbon budgets for a “likely” chance of not exceeding the international community’s 2°C commitment, requires the EU to reduce the emissions from its energy system by 80% by 2030, with complete decarbonisation just a few years later.

Categories: Peak oil news

The Market Ticker - UNC Degrees? Worthless

The Market Ticker - 24 October 2014 - 12:10am

So about that so-called "degree" you're sporting, son....

More than 3,000 students at the University of North Carolina -- nearly half of them athletes -- were enrolled in a "shadow curriculum" over a two-decade period that involved no-show classes and bogus grades, according to a report released by the school on Wednesday.

In other words the so-called "degree" documented exactly nothing -- and it was not limited to athletes either.

This of course means that for an employer the only thing you can do is treat all degrees from this place as worthless, until and unless they are all revoked, every person involved is identified, those who participated in any way are prosecuted for fraud (since said credentials were then used to defraud employers) and imprisoned.

None of which, by the way, is likely to ever happen.

Categories: Economics

The Market Ticker - More Ferguson Findings

The Market Ticker - 24 October 2014 - 12:02am

Well well, now this is interesting.

ST. LOUIS COUNTY • The official autopsy on Michael Brown shows that he was shot in the hand at close range, according to an analysis of the findings by two experts not involved directly in the case.

The accompanying toxicology report shows he had been using marijuana.

Those documents, prepared by the St. Louis County medical examiner and obtained by the Post-Dispatch, provide the most detailed description to date of the wounds Brown sustained in a confrontation Aug. 9 with Ferguson police Officer Darren Wilson.

A source with knowledge of Wilson’s statements said the officer had told investigators that Brown had struggled for Wilson’s pistol inside a police SUV and that Wilson had fired the gun twice, hitting Brown once in the hand. Later, Wilson fired additional shots that killed Brown and ignited a national controversy.

This makes for a few interesting new observations, dove-tailing with what I had previously suspected and so-stated.

First, one of the wounds in Brown's hand was apparently caused when the cop's gun went off in the SUV as residue was found in the wound.  That does not happen unless the gun discharges very close to where the bullet goes in.  The lack of stippling (powder burns external) is unusual but not unprecedented, and the presence of residue in the wound is solid evidence of a contact (or near-so) shot.  Further, tissue evidence was recovered from the police SUV and matches Brown.

This would appear to many to exonerate Wilson (the cop.)  Not so fast, kemosabe!

Had the fatal shot been delivered in the vehicle that would be true, but that's not what happened.  The discharge of the firearm in the SUV, in a tightly-confined space right near the ears of both Brown and Wilson, means they were both almost-certainly temporarily deafened by the blast.  This means that Brown could almost-certainly not hear any commands given by Wilson after that, and Wilson could almost-certainly not hear anything Brown said beyond that point in the encounter either.

The tox report shows recent (but undifferentiated, that is, not quantified) marijuana consumption; that is, he (presumably) smoked weed some time close to the encounter, but whether he was actively high at the time cannot be discerned with any sort of reliability.

The problem remains those gunshot wounds to the head.  The round to the top of the head was recovered in the lateral right facial area with a 12cm travel path.  The other round to the head is the one that exits the jaw and re-enters the upper right chest.

The forensic findings are roughly congruent with the previous private autopsy and present the same problem in terms of physics for those two wounds.

However, there is one further finding -- and that is entrance wound #5 which is unpaired.  

This shot may be that which the entire situation turns on -- specifically, exactly when was that shot delivered.  The problem for Wilson is that the path is not straight-on, but rather downwardimplying that it did not produce Brown falling forward (and thus providing a clean explanation for exactly how the other two shots got delivered to his head in the orientation they were, without Brown being on his knees or otherwise in a submissive posture) but rather was delivered while he was either (1) falling forward or (2) below Wilson's plane of fire (that is, Wilson aimed downward because Brown was on his knees!)

This autopsy also contains no documentation of the sort of abrasion damage that would be expected on the exposed surfaces of the body and clothing if a perpetrator was in a charge toward the officer and was shot with immediately-fatal effect, falling forward at a high rate of speed onto pavement.  Since this is the official autopsy we can thus reasonably conclude that Brown was not in fact in a "bull rush charge" at the moment he was shot in the head.

So all I get from this report is that there is in fact forensic evidence of a struggle in the SUV and the discharge of the officer's weapon, which left forensic evidence in the vehicle and on the deceased.  That looks solid.  

However, that still does not result in the remaining shots being justified unless the officer was being charged by Brown at the time he fired, and the forensics fail to document that as having happened.

Categories: Economics

Seeding change

Energy Bulletin - 23 October 2014 - 10:14pm

73% of seed crops are now ‘owned’ by 10 corporations – while community and grassroots initiatives are working to keep global diversity alive.

Categories: Peak oil news

A Paradox to Savor: A High-Quality, Free Economics Textbook

Energy Bulletin - 23 October 2014 - 9:32pm

Wow, a fresh set of voices in the study of economics that go well beyond the holy dogmas of Samuelson, Nordhaus, Bernanke and Mankiw.

Categories: Peak oil news

Living and Breathing in a 'Black Swan' World

Energy Bulletin - 23 October 2014 - 8:45pm

Resilience...is the capacity to make ongoing adjustments to changing political, economic, and ecological conditions.

Categories: Peak oil news

A Pink Slip for the Progress Fairy

Energy Bulletin - 23 October 2014 - 8:14pm

...I’m going to spend this week’s post summarizing the the decline and fall of industrial civilization.

Categories: Peak oil news

Peak Oil Notes - Oct 23

Energy Bulletin - 23 October 2014 - 8:10pm

 A mid-week update. New York oil futures traded around $82 a barrel this week until Wednesday’s stocks report showed an unexpected 7 million barrel jump in US crude stocks.

Categories: Peak oil news

The St Andrews Transition Roadshow: full report

Transition Culture - 23 October 2014 - 7:08pm

Instead of running an annual conference in 2014, Transition Network is running four Roadshows around the UK.  The pilot took place in Lancaster in July, and St. Andrews in Scotland hosted the first Roadshow proper.  The St Andrews event was hosted by Transition University of St. Andrews, who have been doing amazing work both within and beyond the University.  It was a great occasion, and in this post we'll try and document and celebrate the event, and capture what you missed if you weren't there. 

Day One (by Rob)

The St. Andrews event started on the Friday morning with the Transition Scotland gathering, held at the Botanic Gardens in the ‘Glass Class’, a long greenhouse now used as a classroom.  The morning brought Transitioners from across Scotland together to reflect, share and plan.  As the Roadshow booklet put it:

“Whether your group is going strong, is just getting started, or is somewhat burnt out, we’d love to hear your story as we pool visions of how we see Scotland transitioning to a resilient future, and plan how we’re going to achieve it!”

That set the tone for the day.  We heard stories from across the country, from groups thriving and acting as amazing incubators for all sorts of new enterprises and initiatives to those hanging on by their fingernails.  One of the interesting challenges in Scotland is the Climate Challenge Fund.  Several years ago, when it began, I remember Scottish Transition groups coming to the national conference and talking with delight to jealous Transitioners from elsewhere about this new government grant that was going to fund them to do Transition.

A few years later it’s fascinating to get a sense of how this has worked.  While for some groups, such as Transition Linlithgow and Sustaining Dunbar, it has enabled the patient and skilful building of a range of enterprises and REconomy work, it also had a downside.  Groups that had barely got started, had little in the way of successful projects under their belts, were suddenly well-resourced, and time and energy went into projects rather than building the kind of resilient groups and social networks that Transition depends on. 

Then, after a couple of years, when the funding dried up, there was little to fall back on, and the groups floundered.  Some of those groups are now finding their feet again, some have disappeared.  Similarly dormant now is Transition Scotland, the national network.  The morning discussed ways forward, the role Transition Scotland could play, and possible future directions for Transition.

The afternoon was held at St Andrews Town Hall, and was a REconomy workshop, entitled “Re-imagine your local economy”.  It wasn’t just about the new ideas the REconomy are promoting, but also about linking those in with movements and initiatives already underway in Scotland. 

The session opened with 3 keynote speakers.  Transition Network’s Delivery Director Sarah McAdam spoke about where the idea of REconomy came from, how Transition Network is supporting it, and how far it has already spread. 

Mark Simmonds, REconomy’s Enterprise Advisor, looked at the scope and potential of Transition enterprises in a post-referendum Scotland.


Philip Revell of Sustaining Dunbar, talked about their Local Resilience Action Plan, and what it has led to.

This was followed by workshop sessions: on farming; making the most of opportunities for emerging enterprises, the role of resilience action plans, and the one I went to, led by Angus Hardie, on the Community Empowerment Bill, a piece of legislation so fascinating that it will be the subject of a future post here. 

After a break, I spoke briefly, and then it was into a choice of Round Table discussions.  I went to one about Sustaining Dunbar’s proposed community owned business park, a fascinating, and slightly daunting step up for the group.  After closing comments and a wrapping up, the event closed. 

The evening’s event took place at the Byre Theatre, the town’s theatre that had closed last year only to be recently taken over and reopened by the University.  This was a talk by me, in an odd space, with a gallery looking down on me as well as the audience in front of me.  I talked for about 45 minutes, and it felt like it went well.  A film of it will hopefully follow soon.  I really enjoyed it, and had a couple of very nice St Andrews-brewed pints afterwards. 

The second day was the Roadshow proper.  As I then headed home on the 10 hour train ride home, I will hand over to Mike Thomas, Transition Network’s Support Co-ordinator, to tell you more, and leave you with a photo of the windfarm in the Highlands that I passed on the way home. 

Day 2 (by Mike)

The St. Andrews Road Show is a bit unique as it was hosted by a Transition Initiative based in a University.  Transition University of St Andrews have slowly been embedding Transition into their student community since they began. The Initiative has a Core Group that is made up of and chaired by students. Transition is promoted to all new students from the day they begin with the ‘St And Re-Use’ scheme which collects stuff from students leaving such as cutlery, utensils etc which are then distributed to new students in Freshers Week.  In 2013-14 they collected nearly 1000kg of reusable items which were given new homes by over 700 students.

They also have edible landscape projects, low carbon living projects and social events like Carbon Conversations and Green Drinks amongst other things. It is a great initiative that introduces hundreds of people to Transition and hopefully when they leave university they continue to be involved in Transition in their local communities.

The Road Show got off to a great start with a Laughter Yoga session, which slightly worried me having done a fair bit of yoga myself, and thinking that if I also have to laugh at the same time, I may pull a muscle. It turned out that this wasn't the case, and it was literally a good laugh (excuse the pun) without injuries.

We had a packed day to look forward to with workshops in the morning and afternoon. In the morning people attended workshops that consisted of an Introduction to Transition for people new to the idea, Resourcing your Transition Initiative and Supporting Healthy Transition Initiative. I was shadowing Naresh, our Transition Trainer, to run the workshop on Healthy Transition Initiatives. 

We had a really interesting conversation where we discussed what success looked like for Transition Initiatives with lots good points put forward. We then had an introduction to the new Transition Support model that is going to be launched soon and people thought it looked really good and useful. Through our conversations it became apparent that many groups have the same problems, such as getting people involved, engaging with the community and group dynamics. These are themes that come up again and again and are ones that the new support model will help to address.

Speaking to others at lunch it seemed people found the other workshops helpful too. In particular the Resourcing your Transition Initiative workshop, which gave people a sense of where to go next for getting income. This was especially timely as lots of work developed under the Climate Challenge Fund would need to find new support as that Funding scheme is coming to an end.

Then it was off to St Andrews Town Hall for a lovely lunch of homemade soup and sandwiches. There was also a Sustainability Fair going on upstairs promoting actions that individuals can take to reduce their carbon and energy bills, all good stuff. During this time I got to chat to Andy and Rehema who gave me an insight into the impact of the referendum in Scotland. It seems that the referendum has really sparked a massive conversation amongst local communities on how Scotland should be governed and develop to deal with the future issues such as climate change, jobs, peak oil amongst others. We also discussed the historical land clearances and general land rights as they have a huge impact on the ability to build sustainable communities.

So feeling pretty full, physically from the soup and mentally from the conversation, the next workshop was a ‘Walkshop’ around St. Andrews community food growing projects. St Andrews have set up several projects around different parts of the University and town. The first one we went to was a revitalised orchard. Ali from Transition St Andrews (see above) explained how the University actually used to grow a lot of their own food in the past but that had stopped over time, so an a old practice was being revived by Transition.

We then went off to visit to some of the student housing, this particular area had a lot of lawned green space and Transition University of St Andrews had managed to persuade the University property managers that a community garden would be a good idea. This garden was obviously a bit sparse due to the time of year, but you could see that it had been well managed by student Transitioners and had provided a lot of fruit and vegetables throughout the year.

They have had some problems, such as people eating all the rhubarb before it was ready, but apart from that it was a really successful project. They have also been weighing all the food produced and have found that their yield has increased year on year. It is hoped to extend this food growing project to other areas.

On the talk I also got to hear about the Fife Diet project from Eva who is involved in running it. This is a great project that is concerned with all things food, such as local growing, food networks and reducing carbon. It is one of the largest food projects in Europe with over 6000 members.

As I was touring St Andrews with Ali from Transition St Andrews, a whole other range of workshops were occurring where people were finding out about REconomy and community resilience and how they all link up to provide a powerful means for developing resilient communities. Others were discussing how to monitor and evaluate what their Transition initiative had achieved and what tools can be used to do that.

We then headed back to St Andrews University for the Think Tank Session, where we were treated to homemade apple juice. At the Think Tank session we sat and listened to talks from Prof. Stuart Hazeldine from the University of Edinburgh, who gave his view on Scotland’s future energy issues focusing on the need to reduce domestic use, challenge the use of oil and to think about energy including transport, electricity and heat and Dr. Antje Brown from St Andrews University who highlighted the areas of global, European and national policy that are having an impact on our energy production and carbon reduction target. 

We then all broke into groups for the Think Tank session framed around the question of 'How can Transition build a new world while still operating in the existing system?'. There were 6 tables setup looking at these topics:

  • Jam in the doughnut – Resourcing the “centre” of your transition initiative
  • Wildcard – Any other ideas
  • Acknowledging this moment of change (risks and opportunities)… Making the most of the situation in Scotland
  • Developing our inner journey… Inner Transition
  • Peaks and Troughs : how to manage cycles


During this session there seemed to be an intense conversation happening, with people writing furiously and many ideas, opinions and thoughts being shared. A lot of flipchart paper was filled up with ideas. There definitely felt like there was a lot of passion in the room for Scotland's future, which felt inspiring to see. It was also great seeing students involved in Transition St Andrews taking a really active role in helping run the sessions, by being scribes helping setup rooms, contributing to the debates and generally making sure everything went smoothly.

As is often the case with events you learn lots from the workshops and also loads of interesting stuff just from the conversations you have with people. This is one of the real benefits about getting lots of interesting people with ideas and opinions together in one place. For example my views of a Cèilidh have been permanently changed as I learnt that a Cèilidh is not just a dance but can also be a social gathering where people come together to talk about a range of issues. A practice which had seen a real resurgence in the lead up to the Independence vote.

Overall, it felt like the Road Show allowed a space for people to make new friends and connections that will hopefully continue after the conference, as a post referendum Scotland feels like a place ripe for local communities taking the initiative in developing a positive future for themselves. A big thank you must go out to the Transition University of St Andrews team for all their hard work in putting on this event and to all the people who came along and participated to make it a really fruitful day.

The second Transition Roadshow will be run with Transition Penwith and will take place in Penzance, Cornwall, on February 6/7th.

Categories: TT news

A Pink Slip for the Progress Fairy

The Archdruid Report - 23 October 2014 - 10:24am
If you’ve ever wondered just how powerfully collective thinking grips most members of our species—including, by and large, those who most forcefully insist on the originality of their thinking—I have an experiment to recommend: go out in public and advocate an idea about the future that isn’t part of the conventional wisdom, and see what kind of reaction you field. If your experience is anything like mine, you’ll get some anger, some argument, and some blank stares, but the most telling reaction will come from people who try to force what you’re saying into the Procrustean bed of the conventional wisdom, no matter how thoroughly they have to stretch and chop what you’ve said to make it fit.
Now of course the project of this blog is guaranteed to field such reactions, since the ideas explored here don’t just ignore the conventional wisdom, they fling it to the floor and dance on the crumpled remains. When I mention that I expect the decline and fall of industrial civilization to take centuries, accordingly, people take this to mean that I expect a smooth, untroubled descent. When I mention that I expect crisis before this decade is finished, in turn, people take this to mean that I expect industrial civilization to crash into ruin in the next few years. Some people, for that matter, slam back and forth from one of these presuppositions to another, as though they can’t fit the concepts of prolonged decline and imminent crisis into their heads at the same moment.
That sort of response has become more common than usual in recent months, and part of the reason may be that it’s been a while since I’ve sketched out the overall shape of the future as I see it.  Some of my readers may have lost track of the broader picture, and more recent readers of this blog may not have encountered that picture at all. For that reason among others, I’m going to spend this week’s post summarizing the the decline and fall of  industrial civilization.
Yes, I’m aware that many people believe that such a thing can’t happen:  that science, technology, or some other factor has made progress irreversible. I’m also aware that many people insist that progress may not be irreversible yet but will be if we all just do that little bit more. These are—well, let’s be charitable and call them faith-based claims. Generalizing from a sample size of one when the experiment hasn’t yet run its course is poor scientific procedure; insisting that just this once, the law of diminishing returns will be suspended for our benefit is the antithesis of science. It amounts to treating progress as some sort of beneficent fairy who can be counted on to tap us with her magic wand and give us a wonderful future, just because we happen to want one.
The overfamiliar cry of “but it’s different this time!” is popular, it’s comforting, but it’s also irrelevant. Of course it’s different this time; it was different every other time, too. Neolithic civilizations limited to one river valley and continental empires with complex technologies have all declined and fallen in much the same way and for much the same reasons. It may appeal to our sense of entitlement to see ourselves as destiny’s darlings, to insist that the Progress Fairy has promised us a glorious future out there among the stars, or even to claim that it’s humanity’s mission to populate the galaxy, but these are another set of faith-based claims; it’s a little startling, in fact, to watch so many people who claim to have outgrown theology clinging to such overtly religious concepts as humanity’s mission and destiny.
In the real world, when civilizations exhaust their resource bases and wreck the ecological cycles that support them, they fall. It takes between one and three centuries on average for the fall to happen—and no, big complex civilizations don’t fall noticeably faster or slower than smaller and simpler ones.  Nor is it a linear decline—the end of a civilization is a fractal process composed of crises on many different scales of space and time, with equally uneven consequences. An effective response can win a breathing space; in the wake of a less effective one, part of what used to be normal goes away for good. Sooner or later, one crisis too many overwhelms the last defenses, and the civilization falls, leaving scattered remnants of itself that struggle and gleam for a while until the long night closes in.
The historian Arnold Toynbee, whose study of the rise and fall of civilizations is the most detailed and cogent for our purpose, has traced a recurring rhythm in this process.  Falling civilizations oscillate between periods of intense crisis and periods of relative calm, each such period lasting anywhere from a few decades to a century or more—the pace is set by the speed of the underlying decline, which varies somewhat from case to case. Most civilizations, he found, go through three and a half cycles of crisis and stabilization—the half being, of course, the final crisis from which there is no recovery. 
That’s basically the model that I’m applying to our future. One wrinkle many people miss is that we’re not waiting for the first of the three and a half rounds of crisis and recovery to hit; we’re waiting for the second. The first began in 1914 and ended around 1954, driven by the downfall of the British Empire and the collapse of European domination of the globe. During the forty years between Sarajevo and Dien Bien Phu, the industrial world was hammered by the First World War, the Spanish Flu pandemic, the Great Depression, millions of political murders by the Nazi and Soviet governments, the Second World War, and the overthrow of European colonial empires around the planet.
That was the first era of crisis in the decline and fall of industrial civilization. The period from 1945 to the present was the first interval of stability and recovery, made more prosperous and expansive than most examples of the species by the breakneck exploitation of petroleum and other fossil fuels, and a corresponding boom in technology. At this point, as fossil fuel reserves deplete, the planet’s capacity to absorb carbon dioxide and other pollutants runs up against hard limits, and a galaxy of other measures of impending crisis move toward the red line, it’s likely that the next round of crisis is not far off.
What will actually trigger that next round, though, is anyone’s guess. In the years leading up to 1914, plenty of people sensed that an explosion was coming, some guessed that a general European war would set it off, but nobody knew that the trigger would be the assassination of an Austrian archduke on the streets of Sarajevo. The Russian Revolution, the March on Rome, the crash of ‘29, Stalin, Hitler, Pearl Harbor, Auschwitz, Hiroshima? No one saw those coming, and only a few people even guessed that something resembling one or another of these things might be in the offing.
Thus trying to foresee the future of industrial society in detail is an impossible task. Sketching out the sort of future that we could get is considerably less challenging. History has plenty to say about the things that happen when a civilization begins its long descent into chaos and barbarism, and it’s not too difficult to generalize from that evidence. I don’t claim that the events outlined below are what will happen, but I expect things like them to happen; further than that, the lessons of history will not go.
With those cautions, here’s a narrative sketch of the kind of future that waits for us.
*************************The second wave of crisis began with the Ebola pandemic, which emerged in West Africa early in 2014. Efforts to control the outbreak in its early phases were ineffective and hopelessly underfunded. By the early months of 2015, the first cases appeared in India, Egypt, and the Caribbean, and from there the pandemic spread to much of the world. In August 2015 a vaccine passed its clinical trials, but scaling up production and distribution of the vaccine to get in front of a fast-spreading pandemic took time, and it was early 2018 before the pandemic was finally under control everywhere in the world. By then 1.6 billion people had died of the disease, and another 210 million had died as a result of the collapse of food distribution and health care across large areas of the Third World.
The struggle against Ebola was complicated by the global economic depression that got under way in 2015 as the “fracking” boom imploded and travel and tourist industries collapsed in the face of the pandemic. Financial markets were stabilized by vast infusions of government debt, as they had been in the wake of the 2008 crash, but the real economy of goods and services was not so easily manipulated; joblessness soared, tax revenues plunged, and a dozen nations defaulted on their debts. Politicians insisted, as they had done for the past decade, that giving more handouts to the rich would restore prosperity; their failure to take any constructive action set the stage for the next act in the tragedy.
The first neofascist parties were founded in Europe before the end of the pandemic, and grew rapidly in the depression years. In 2020 and 2021, neofascists took power in three European nations on anti-immigration, anti-EU and anti-banking industry platforms; their success emboldened similar efforts elsewhere. Even so, the emergence of the neofascist American Peoples Party as a major force in the 2024 US elections stunned most observers. Four years later the APP swept the elections, and forced through laws that turned Congress into an advisory body and enabled rule by presidential decree. Meanwhile, as more European nations embraced neofascism, Europe split into hostile blocs, leading to the dissolution of the European Union in 2032 and the European War of 2035-2041.
By the time war broke out in Europe, the popularity of the APP had fallen drastically due to ongoing economic troubles, and insurgencies against the new regime had emerged in the South and mountain West.  Counterinsurgency efforts proved no more effective than they had in Iraq or Afghanistan, and over the next decade much of the US sank into failed-state conditions. In 2046, after the regime used tactical nuclear weapons on three rebel-held cities, a dissident faction of the US military launched a nuclear strike on Washington DC, terminating the APP regime. Attempts to establish a new federal government failed over the next two years, and the former United States broke into seven nations.
Outside Europe and North America, changes were less dramatic, with the Iranian civil war of 2027-2034 and the Sino-Japanese war of 2033-2035 among the major incidents. Most of the Third World was prostrate in the wake of the Ebola pandemic, and world population continued to decline gradually as the economic crisis took its toll and the long-term effects of the pandemic played out. By 2048 roughly fifteen per cent of the world’s people lived in areas no longer governed by a nation-state.
The years from 2048 to 2089 were an era of relative peace under Chinese global hegemony. The chaos of the crisis years eliminated a great many wasteful habits, such as private automobiles and widespread air travel, and renewable resources padded out with what was left of the world’s fossil fuel production were able to meet the reduced needs of a smaller and less extravagant global population. Sea levels had begun rising steadily during the crisis years; ironically, the need to relocate ports and coastal cities minimized unemployment in the 2050s and 2060s, bringing relative prosperity to the laboring classes. High and rising energy prices spurred deautomation of many industries, with similar effects.
The pace of climate change accelerated, however, as carbon dioxide from the reckless fossil fuel use of the crisis years had its inevitable effect, pushing the polar ice sheets toward collapse and making harvests unpredictable around the globe. Drought gripped the American Southwest, forcing most of the region’s population to move and turning the region into a de facto stateless zone.  The same process destabilized much of the Middle East and south Asia, laying the groundwork for renewed crisis.  
Population levels stabilized in the 2050s and 2060s and began to contract again thereafter. The primary culprit was once again disease, this time from a gamut of pathogens. The expansion of tropical diseases into formerly temperate regions, the spread of antibiotic resistance to effectively all bacterial pathogens, and the immense damage to public health infrastructure during the crisis years all played a part in that shift. The first migrations of climate refugees also helped spread disease and disruption.
The last decade before 2089 was a time of renewed troubles, with political tensions pitting China and its primary allies, Australia and Canada, against the rising power of the South American Union (formed by 2067’s Treaty of Montevideo between Argentina, Chile, Uruguay and Paraguay), and  insurgencies in eastern Europe that set the stage for the Second European War. Economic troubles driven by repeated crop failures in North America and China added to the strains, and kept anyone but scientists from noticing what was happening to the Greenland ice sheet until it was too late.
The collapse of the Greenland ice sheet, which began in earnest in the summer of 2089, delivered a body blow to an already fraying civilization. Meltwater pouring into the North Atlantic shut down the thermohaline circulation, the main driver of the world’s ocean currents, unleashing drastic swings in weather across most of the world’s climate zones, while sea levels jolted upwards. As these trends worsened, climate refugees fled drought, flood, or famine in any direction that promised survival—a promise that in most cases would not be kept. Those nations that opened their borders collapsed under the influx of millions of starving migrants; those who tried to close their borders found themselves at war with entire peoples on the move, in many cases armed with the weapons of pre-crisis armies.
The full impact of the Greenland disaster took time to build, but the initial shock to weather patterns was enough to help trigger the Second European War of 2091-2111. The Twenty Years War, as it was called, pitted most of the nations of Europe against each other in what began as a struggle for mastery and devolved into a struggle for survival. As the fighting dragged on, mercenaries from the Middle East and Africa made up an ever larger fraction of the combatants. The final defeat of the Franco-Swedish alliance in 2111, though it ended the war, left Europe a shattered wreck unable to stem the human tide from the devastated regions further south and east.
Elsewhere, migration and catastrophic climate change brought down most of the nations of North America, while China dissolved in civil war. Australia and the South American Union both unexpectedly benefited as rainfall increased over their territory; both nations survived the first wave of troubles more or less intact, only to face repeated invasions by armed migrants in the following decades. Neither quite succumbed, but most of their resources went into the fight for survival.
Historians attempting to trace the course of events in most of the world are hampered by sparse and fragmentary records, as not only nation-states and their institutions but even basic literacy evaporated in many regions. As long as the migrations continued, settled life was impossible anywhere close to the major corridors of population movement; elsewhere, locals and migrants worked or fought their way to a modus vivendi, or failing that, exterminated one another. Violence, famine and disease added their toll and drove the population of the planet below two billion.
By the 2160s, though, the mass migrations were mostly at an end, and relative stability returned to many parts of the planet. In the aftermath, the South American Union became the world’s dominant power, though its international reach was limited to a modest blue-water navy patrolling the sea lanes and a network of alliances with the dozen or so functioning nation-states that still existed. Critical shortages of nonrenewable resources made salvage one of the few growth industries of the era; an enterprising salvage merchant who knew how to barter with the villagers and nomads of the stateless zones for scrap technology from abandoned cities could become rich in a single voyage.
Important as they were, these salvaged technologies were only accessible to the few.  The Union and a few other nation-states still kept some aging military aircraft operational, but maritime traffic once again was carried by tall ships, and horse-drawn wagons became a standard mode of transport on land away from the railroads. Radio communication had long since taken over from the last fitful fragments of the internet, and electric grids were found only in cities. As for the high-end technologies of a century and a half before, few people even remembered that they had ever existed at all.
In the end, though, the era of Union supremacy was little more than a breathing space, made possible only by the collapse of collective life in the stateless zones. As these began to recover from the era of migrations, and control over salvage passed into the hands of local warlords, the frail economies of the nation-states suffered. Rivalry over access to salvage sites still available for exploitation led to rising tensions between the Union and Australia, and thus to the last act of the tragedy.
This was set in motion by the Pacific War between the Union and Australia, which broke out in 2238 and shredded the economies of both nations.  After the disastrous Battle of Tahiti in 2241, the Union navy’s power to keep sea lanes open and free of piracy was a thing of the past. Maritime trade collapsed, throwing each region onto its own limited resources and destabilizing those parts of the stateless zones that had become dependent on the salvage industry. Even those nations that retained the social forms of the industrial era transformed themselves into agrarian societies where all economics was local and all technology handmade.
The negotiated peace of 2244 brought only the briefest respite: a fatally weakened Australia was overrun by Malik Ibrahim’s armies after the Battle of Darwin in 2251, and the Union fragmented in the wake of the coup of 2268 and the civil war that followed. Both nations had become too dependent on the salvaged technologies of an earlier day; the future belonged to newborn successor cultures in various corners of the world, whose blacksmiths learned how to hammer the scrap metal of ruined cities into firearms, wind turbines, fuel-alcohol stills, and engines to power handbuilt ultralight aircraft. The Earth’s first global civilization had given way to its first global dark age, and nearly four centuries would pass before new societies would be stable enough to support the amenities of civilization.
*************************I probably need to repeat that this is the kind of future I expect, not the specific future I foresee; the details are illustrative, not predictive. Whether the Ebola epidemic spins out of control or not, whether the United States undergoes a fascist takeover or runs headlong into some other disaster, whether China or some other nation becomes the stabilizing hegemon in the next period of relative peace—all these are anyone’s guess. All I’m suggesting is that events like the ones I’ve outlined are likely to occur as industrial civilization stumbles down the curve of decline and fall.
In the real world, in the course of ordinary history, these things happen. So does the decline and fall of civilizations that deplete their resource bases and wreck the ecological cycles that support them. As I noted above, I’m aware that true believers in progress insist that this can’t happen to us, but a growing number of people have noticed that the Progress Fairy got her pink slip some time ago, and ordinary history has taken her place as the arbiter of human affairs. That being the case, getting used to what ordinary history brings may be a highly useful habit to cultivate just now.
Categories: Peak oil news

In the Downdraft of Hormegeddon

The Daily Reckoning - 23 October 2014 - 9:47am

This post In the Downdraft of Hormegeddon appeared first on Daily Reckoning.

Hormegeddon is a modern phenomenon. It is only possible since the advent of civilization. Without civilization, there are no masses. Without the masses, there are no mass movements, no mass delusions, no mass revolts and no mass epidemics.

All mass phenomena function in a similar way to the behavior of disease. Passing from one person to another in large groups, infectious bacteria multiply and mutate. Those killed by antibiotics and natural antibodies die off. Those not killed continue adapting and evolving.

Without frequent contact with the enemy, the target grows soft and vulnerable. Over time, the more successful people become at protecting themselves — by avoiding the invasions of deadly bacteria — the more susceptible they become to the next mutant invader.

As defenses weaken, the risk/reward ratio — for the potential invader — improves. The more successful he has been at resisting invasion, the more irresistible the target becomes.

This insight puts us in an extremely cynical and pessimistic frame of mind. Progress of any kind in collective human life seems impossible. The more civilized people become, the more they are tempted to barbarism. Imagine, for example, a community so civilized that there are no locks on the liquor cabinets and merchants leave their goods, unguarded on the sidewalks, while policemen take their mid- afternoon naps. Who could resist the urge to larceny?

It is true that cooperation builds trust, and high levels of trust bring benefits to a society, lowering transaction costs while encouraging specialization and trade. But this only increases the rewards to the non-cooperating rule-breaker. As the risk/reward ratio goes higher cheating becomes more attractive.

Imagine a town in the Dark Ages, surrounded by strong stone walls. Such a town could become wealthy by trade and commerce — cooperative activities that yield a profit, which could be accumulated. The stone walls, manned by skilled soldiers, would hold off enemies.

The better the defenses, the longer the town’s merchants and producers could carry on their trades without being molested. And the more wealth they could accumulate. But this growth would cause the potential attacker to redo his math. The cost of attack — weapons, mercenary soldiers, outfitting, supplying, and so forth — might stay the same. But the reward would increase, promising a better return on investment.

At the same time, the town, having not been attacked in decades, would become complacent. It might ignore its defenses and neglect to pay its own soldiers. ‘Why bear the cost of protection when it is clearly unnecessary,’ the city fathers would ask of one another? This, of course, would lower the cost of a hostile takeover…and further tempt the potential parasitic invader.

In the modern, developed world, we see this temptation to parasitism in much less threatening forms — free medical care for seniors, disability payments to obese people, government agencies pretending to ‘do good’ and so forth. We see it in less benign forms also — drones, spying, loss of habeas corpus, foreign wars, etc.

We see the cycle of civilization in the bond market too. The rising trust and cooperation of advancing civilization produces net positive returns…and falling interest yields. This is not just speculation.

According to Sidney Homer and Richard’s Sylla’s “History of Interest Rates,” in the 14th and 15th century interest rates averaged from 10% to 25% in the Spanish Netherlands and from 15% to 20% in France. As civilization advanced, interest rates fell — in the United States in the 20th century, to an average of about 3% to 4%.

But this grand progress, lowering interest yields over centuries, was not a straight-line affair. It was cyclical. Each time rates fell “too low,” too much money was lent to too many marginal borrowers.

The civilized rule is simple: when you borrow money you must repay it. But households over-extended themselves. Lenders overlooked the weakness in their borrowers’ balance sheets. Borrowers tended to overstate their financial solidity. Entrepreneurs overreached. Merchants oversold. Defaults increased. And the real rate of return declined as trust gave way to fear (of losing money).

High cooperation = high temptation. At the margin, where all the important things in life take place, lax lending standards lead borrowers to take out loans they can’t pay back. The desire to gain privileges, status, and income streams overwhelms the respect for the cooperative protocols that brought the positive returns in the first place.

New ‘values’ appear that seem to justify departure from the original rules. Self-reliance, forbearance, and independence, for example, are replaced by fairness, security, and universal health care. However, you will notice a clear distinction between the old values and the new ones.

They reflect a change in attitude, from risk taking to risk avoidance, from wealth building to wealth preservation, and from laissez-faire to centralized control. They may also be expressed as different kinds of rights. The former are rights to do something for yourself. The latter are rights to force someone else to do something for you. The former require cooperation. The latter need only fear and then violence.

Without civilized cooperation, hormegeddon wouldn’t be possible. Collective enterprises on such a grand scale need the wealth and organization of civilized societies. Such societies become civilized because they eschew the short-term benefits of violence in favor of the longer-term benefits of cooperation.

Their success begets failure, trust begets aggressive parasitism, and we see a return to violence. Under the strain of policing and enforcing the new rights, the return on investment falls. Then, the zombie elite becomes ruthless in its efforts to protect its gains.

Government is the key player in this process. As we have seen, government is always and everywhere a reactionary institution, favoring the interests of the (voting, contributing, backstabbing) past and present over the (unborn, unknown, helpless and harmless) future. But in the downdraft of hormegeddon, government becomes a real monster.


Bill Bonner
for The Daily Reckoning

Ed note: today’s email edition, you could’ve read all about our sit-down with Bill… not to mention reactions good and bad to a provocative article Jim Rickards wrote exclusively for us. It’s all part of the larger discussion going on in the FREE Daily Reckoning email edition. If you haven’t signed up yet, you’re missing out. It’s free and easy to do, you simply need to click here now.

The post In the Downdraft of Hormegeddon appeared first on Daily Reckoning.

Categories: Economics

Health Care Costs: Still the Pig in the Federal Python

The Daily Reckoning - 23 October 2014 - 7:10am

This post Health Care Costs: Still the Pig in the Federal Python appeared first on Daily Reckoning.

“Federal spending for health care programs is growing much faster than other federal spending and the economy as a whole,” according to a recent analysis from the Congressional Budget Office (CBO).

We said as much in these pages when we reminded you that health care’s portion of the federal budget keeps doubling every 20 years or so. By now it eats up 25% of the budget. Will it really be 50% two decades hence?

The words of the late economist Herbert Stein come to mind: “If something cannot go on forever, it will stop.”

Obamacare? It’s a contributing factor to the metastasis, but not a big one. Even after Obamacare is fully in place, the CBO says most of the growth in health care spending will come from Medicare. In a 2009 study, pre-Obamacare, the Mercatus Center furnished the helpful chart below showing not only that Medicare spending is projected to grow… but the CBO’s projections of future Medicare spending keep growing too.

The CBO’s latest report offers a few suggestions to tame the monster. “Among those,” writes J.D. Tuccille at Reason, “are taxing, bribing and nagging people into healthier behavior, capping federal Medicaid payments (an approach that would kneecap the current push to expand Medicaid rolls), and paying less to medical providers.”

Those are all distinct possibilities. But our mind keeps coming back to a number we reported in early 2012.

All that money Uncle Sam spends on health care? One out of every six dollars is spent on the final year of life.

And here’s a new number we’ve run across: A quarter of Medicare’s budget is spent on the final year of life. And 10% of Medicare’s spending goes toward the final 30 days.

End-of-life health care is one of only two things that genuinely threaten Uncle Sam’s solvency…

End-of-life health care is one of only two things that genuinely threaten Uncle Sam’s solvency, according to our friend David Walker, the former U.S. comptroller general. (The home mortgage interest deduction is the other.) “But we can’t have an honest conversation about it,” he said.

As we wrote 2½ years ago, all that spending is the result of a “whatever it takes” approach to forestalling the Grim Reaper’s inevitable appearance. That approach remains standard operating procedure, according to a new study from Stanford surveying nearly 1,100 doctors. It finds medical science has “its default set to maximal interventions for all patients, irrespective of the effectiveness of doing so.”

But it’s impossible to have that “honest conversation.” Remember “death panels” when Obamacare was being debated in Congress five years ago? That was a clause in the bill — ultimately dropped — providing for government-paid counseling to plan for end-of-life care.

Republicans objected that government would end up deciding who would live and who would die. It was a fair objection. But it also skirted an “honest conversation” confronting this question: Is it fair for doctors to do “whatever it takes”… and push off the costs onto a dead-broke Medicare program, to be paid for by the next generation?

The Stanford study finds many doctors questioning the “whatever it takes” approach… when it comes to their own care. That’s because doctors, in the words of the research paper, “recurrently witness the tremendous suffering their terminally ill patients experience as they undergo ineffective, high-intensity treatments at the end of life.”

But when it comes to the care of their patients, it’s still full speed ahead. The study says upfront the “current fiscal system rewards hospitals and doctors for medical procedures and providing high-intensity care to terminally ill persons.”

Indeed, the number of Medicare patients who saw 10 or more doctors in the final six months of life grew 12% from 2003-07, the most recent figures available. The number of days those patients spent in intensive care also grew.

We don’t know when the cost curve will reach the breaking point. But we know it will. When the flow of “free” money is shut off, maybe doctors will start having an “honest conversation” with patients about treatments that reach “a tipping point where the treatment becomes more burdensome than the illness itself,” as the Stanford study puts it.

It’s uncomfortable to think about. But we figure it’s better if you hear about it from us now than from a doctor a few years hence when someone you love is approaching his or her final days.


Addison Wiggin
for The Daily Reckoning

Ed. Note: It’s been six years since we traveled cross-country with David Walker, the nation’s longest-serving top accountant or comptroller general, then president and CEO of the Peter G. Peterson Foundation and protagonist of our I.O.U.S.A documentary we filmed at the time.

We interviewed financial luminaries such as Alan Greenspan, Warren Buffett, Paul Volcker and Paul O’Neill to help Walker sound the alarm about the truth behind the nexus between Washington and Wall Street.

At the time, the true national debt combined with unfunded obligations and promises tallied $53 trillion, a number reckless enough to “sink our ship of state,” in Walker’s words…unless we the people rose to action. A scant eight weeks after our film of the Fiscal Wake-Up Tour premiered, Lehman Bros. filed the largest bankruptcy in U.S. history, and the Great Recession followed.

That $53 trillion hole caved in on itself and is now nearly twice as deep. Ultimately, it will be your spending power that erodes.  We remember, all too well, the breezy air with which the luminaries in our film assured us the U.S. economy was “dynamic” enough to “grow” the federal government out of its debt crisis.  How? We wondered. And who?

That’s what we explore every day in the FREE Tomorrow in Review e-letter, where our contributors provide analysis, market forecast and actionable, innovative investment ideas that are responsible for – not just creating new businesses – but entirely new industries, and whole new waves of wealth creation. At the same time, these disruptive innovations destroy old industries. That’s why we write it for our readers, free of charge. You can’t afford not to get this intel. Sign up for the FREE Tomorrow in Review e-letter: CLICK HERE.

The post Health Care Costs: Still the Pig in the Federal Python appeared first on Daily Reckoning.

Categories: Economics

Six Signs Your Government’s Too Big

The Daily Reckoning - 23 October 2014 - 4:23am

This post Six Signs Your Government’s Too Big appeared first on Daily Reckoning.

In today’s episode, we’re going to show you six “red flags” to look out for.

These flags will inform you — with little doubt — that your government is, in fact, too swollen.

Let’s dive right in…

No. 1: Your government is too big if government contractors get paid to hit the refresh button for months on end…

“Employees at an ObamaCare processing center in Missouri with a contract worth $1.2 billion,” one New York Post article reads, “are reportedly getting paid to do nothing but sit at their computers.”

Serco, a company owned by a British firm, was awarded over a billion dollars to handle ACA applications.

According to one whistleblower, Serco is attempting to hide the lack of actual work they’re doing. Instead, its HR department is hastily hiring employees in its centers in Missouri, Kentucky and Oklahoma.

Of course, duly compensated with each new body in a chair.

Weeks can pass, the whistleblower told St. Louis’ News 4, before employees receive even one application to process.

“They’re told to sit at their computers and hit the refresh button every 10 minutes,” said the informant, “no more than every 10 minutes.”

Sure, it’s no Snowden revelation. But, hey, it’s good to see the government still living up to its reputation.

No. 2: Your government is too big if colleges have “free speech areas”…

Apparently, Broward College in Florida now has “free speech areas” for talking to students about the government.

Meet Lauren Cooley.

She’s a 22-year-old journalist and field coordinator for Turning Point USA, a national non-profit promoting small government and free-market values.

After spending 90 minutes talking to students at the school and asking them “do you think big government sucks?”, she was told by a security guard that she needed to go to the “free speech area.”

When Cooley refused to show identification, she was promptly surrounded by several officers.

She asked one officer if she was allowed to talk to students.

“No, you cannot,” he replied. “You need to leave the campus now. If you do not leave you will be arrested for trespassing.”

“Broward College,” Cooley told reporters from The College Fix, “it’s a public school, I live in Broward County, it’s literally the college my tax dollars go to partially fund.

“I would speculate this happened because of heightened security for the governors debate, but that just shows the larger your government grows, the quicker your rights are violated.”

No. 3: Your government is too big if it can’t stop supplying radical terror groups with high-grade weaponry…

The U.S. just handed weapons to ISIS. Again.

“At least one bundle of U.S. weapons airdropped in Syria appears to have fallen into the hands of ISIS,” The Daily Beast reported yesterday, “a dangerous misfire in the American mission to speed aid to Kurdish forces making their stand in Kobani.”

How did the Beast discover this? Youtube.

The tech-savvy ISIS has been broadcasting their American-made weapons on the video sharing platform for weeks. And they have plenty to show off.

“ISIS videos have shown its fighters driving U.S. tanks, MRAPS, [and] Humvees,” the blog writes. “There are unconfirmed reports ISIS has stolen three fighter planes from Iraqi bases it conquered.”

No. 4: Your government is too big if the arm that has secretly supplied weapons to foreigners for 67 years says it doesn’t work and the officials tell them to do it anyway…

Well before ISIS scooped up its new American-made toys, the CIA admitted that arming foreign insurgents rarely works…

“If you’re someone who’s gung-ho about secretly sending American weapons abroad,” Elias Isquith writes for Salon, “the agency’s conclusions are not pretty.”

In its 67-year history, the CIA has armed hundreds of thousands of troops to do Uncle Sam’s bidding.

And they’re just now, according to the data in one classified report, realizing it’s a failed method.

“The still-classified review,” The New York Times reports, “one of several CIA studies commissioned in 2012 and 2013 in the midst of the Obama administration’s protracted debate about whether to wade into the Syrian civil war, concluded that many past attempts by the agency to arm foreign forces covertly had a minimal impact on the long-term outcome of a conflict.

“They were even less effective, the report found, when the militias fought without any direct American support on the ground.”
I know what you might be thinking…

Yes, this apparently-leaked document could, of course, just be a ruse to drum up support for troops on the ground.

Admit defeat. Offer a solution.

A new tactic in the government playbook?

We shall see…

No. 5: Your government is too big if it hires an Ebola czar that knows nothing about Ebola. His only real job is to mix up another layer of bureaucracy into the already-rich batter…

His name, as you may know, is Ron Klain.

On Friday, Obama announced his decision to appoint Klain as the Ebola coordinator. Klain’s job? To work hand-in-hand with the CDC to facilitate a speedy response.

His goal? To be present, ready and waiting to help prevent further spread of Ebola.

One thing…

Klain wasn’t there when Obama announced Klain’s new role on Friday.

And on Saturday Obama hosted an Ebola strategy meeting. Klain was, again, nowhere to be found.

It’s also reported that he’ll be skipping a House hearing this Friday that will examine the current U.S. response to Ebola.

Sounds like Obama has picked the right man for the job, eh?

If only all our government officials were so laissez-faire…

Oh yeah, there’s another hitch: Klain knows nothing about Ebola. But he does know the slope of the Hill. And as we all know, that’s all it truly takes to rise to the top.

No. 6: Your government is too big if its decisions start to mimic silly Holiday Inn commercials…

You may remember this commercial. It came out in 2001 for Holiday Inn Express.

Here’s the scene:

[Five scientists in hazmat suits huddle around a small glass container marked “Ebola.”]

“This is a very rare strain of the Ebola virus,” says one scientist who, oddly enough, looks extremely similar to Klain. “It produces MRNA, the deadliest of the stem loop structures.”

[The camera slowly zooms closer. Klain’s doppleganger clumsily knocks the glass container holding the virus off the table. It breaks on the floor. The other scientists gasp.]

“Oh, don’t worry,” he says, “it’s not an airborne strain.”

“Excuse me,” another scientist says, “how long have you been studying the Ebola virus?”

“Well,” he says, “I’m not actually a scientist, but I did stay at a Holiday Inn Express last night.”

[Another scientist behind him passes out.]

Someone check the Holiday Inn. Our Ebola czar has gone missing.

Until tomorrow,

Chris Campbell
for The Daily Reckoning

Ed. Note: Missing out on everything Laissez Faire Today has to offer? Our articles in the Daily Reckoning only cover a small part. To get full unfettered access to everything, become an LFT member FREE. Click here to sign up now.

The post Six Signs Your Government’s Too Big appeared first on Daily Reckoning.

Categories: Economics

McDisaster: Fast Food Is Dying – Make a Killing From It…

The Daily Reckoning - 23 October 2014 - 2:08am

This post McDisaster: Fast Food Is Dying – Make a Killing From It… appeared first on Daily Reckoning.

Excuse me sir, would you like to super-size that crash?

McDonalds stock is getting crushed right now. Shares have been in a tailspin since June. But it’s not just Mickey Dee’s. Coca Cola shares are in freefall, too.

Bad news for them. But if you want to rake in a pile of easy money, it could be great news for you. Here’s why…

See, Americans just aren’t choking down this junk like they used to. The fast food burger, fries and a Coke are just down payments on an early coronary – and Type II diabetes. And everyone’s finally gotten the message. In a recent Consumer Reports survey, McDonalds ranked dead last in food quality, value, and service. Consumers are looking for healthier alternatives, and there’s a growing demand for “green” organic and hormone-free foods.

Just look at shares of McDonalds Corp. (NYSE:MCD). It’s down nearly 4% on the year. Only yesterday, the fast food giant reported 30% drop in its third-quarter earnings. Management cites challenges in the biz that are “more formidable than expected.”

Gee, I wonder if the captain of the Titanic used that phrase to describe the threat of icebergs after he slammed into one…

Whatever McDonald’s excuses are for laying an egg this earnings season, one fact is undeniable: Unhealthy, traditional food offerings are on their way out the door. And anyone owning shares of the junk-peddlers will suffer in the long-term. The stock is already breaking down to new lows on the year. It’s only a matter of time before shares find themselves locked in an even nastier downtrend.

Still don’t believe me? Check out Coca Cola Co. (NYSE:KO). The Big Mac’s best friend is coming off its sugar high and spiraling lower. After posting disappointing earnings and a cruddy full-year outlook, Coke shares took their worst one-day hit since October 2008.

Both McDonalds and Coca Cola are in big trouble. And these are Dow stocks we’re talking about! Investors are looking to these names for safety. But they’re getting nothing but losses.

Here’s the truth that many investors can’t admit: There’s no growth in junk food anymore. Consumers’ habits are changing. They’re gluten free, low-carb, no-carb, organic and environmentally aware. I really don’t care if you think these are the attitudes of tree-huggers and hippies —I’m just telling you what’s happening in the market.

Companies are realizing they need to shift focus to healthier options — or lose market share.

So put that burger down and sell these bloated “junk” stocks now.


Greg Guenthner
for The Daily Reckoning

P.S. Looking for an alternative to the fast food stocks? Sign up for the Rude Awakening for FREE today to see how you can trade this trend for huge gains…

The post McDisaster: Fast Food Is Dying – Make a Killing From It… appeared first on Daily Reckoning.

Categories: Economics

The Market Ticker - Oh Look At The Admission!

The Market Ticker - 23 October 2014 - 1:46am

Hoh hoh hoh hoh hoh hoh hoh....

By estimating that zero stimulus would be consistent with a 10 percent quarterly drop in equities, they calculate it takes around $200 billion from central banks each quarter to keep markets from selling off.


Note that central bank "stimulus" is not real.  An example will suffice.

Let's say there are exactly two things in the world of economic value -- $100 and 100 bushels of corn.

What's the likely clearing price -- that is, what you would exchange one bushel of corn for?

$1, right?

Remember, other than time preference there is nothing else in the economy to express value through than corn and dollars.

Ok, so now the central banks simply double the number of dollars.  That is, there now exists $200.

What is now the likely clearing price for one bushel of corn?


So the "price" of markets "not selling off" is the theft of that $200 billion a quarter, or $800 billion a year, from you in the form of your purchasing power.  In other words that $800 billion a year is stolen from you.

If you were taxed to the tune of a few thousand dollars a year so people with stocks would not see the price of their stock decline, and it was literally given to those people who owned stock, you'd be outraged.  The lower-income people who can't afford to and don't own any stock would likely revolt -- and quite-possibly violently so.

So let's now have a full and fair discussion about your silent consent to this now-admitted theft......

Categories: Economics

Resilient and Sustainable Infrastructure for Urban Energy Systems

Energy Bulletin - 23 October 2014 - 1:46am

Extreme weather from climate change and growing urbanization are making cities more vulnerable to loss of electric power and damage to energy infrastructure.

Categories: Peak oil news

Fracking Ban Ballot Initiatives Intensify

Energy Bulletin - 23 October 2014 - 1:06am

County ballot issues to ban fracking could have a large impact outside those counties

Categories: Peak oil news

The Market Ticker - Smallpox Blankets *FROM* Mexico: Obama's Legacy?

The Market Ticker - 23 October 2014 - 12:53am

Unbridled "open border" immigration is outrageously unwise.  It has historically been associated with forced "immigration", otherwise known as an invasion.

In the early days of our nation when those who came from Europe forced themselves upon the people living in what is now America ("Indians") we allegedly took care of those pesky natives by giving them blankets.  But not just any blanket -- blankets that a person who had smallpox had wrapped themselves in.

We allegedly did this knowing that the blankets were infused with disease.  The native people of America, having zero exposure historically to that disease, had no immunity to it of any sort.  Huge numbers of them died as a consequence.  

At least this is the story told, although there is decent evidence that story may have been fabricated.

Today's version, sadly, appears to be true.

You see, today our government is doing this, albeit on a much smaller scale and perhaps through misfeasance rather than malfeasance, with our "open border" policy toward Mexico and they're aiming the disease at our children.

“Let me emphasize something in context to your question,” Brooks said. “Immigration is part of Ebola, is a part of this new virus – I say ‘new’ in quotations marks because it’s relatively new to the degree we’ve seen it in the United States of America that taking the lives of American children, that is causing partial or complete paralysis of American children. All of this is related to immigration because some of these diseases are coming from abroad. By way of example, there was a study in 2013 – I think it was called the enterovirus that is causing the paralysis and death of young children in America – that thousands of residents of Central American countries were found with this illness over a year ago in 2013. 

Ebola has all the attention but enterovirus is a disease that is relatively common in Central America but virtually unknown in America.  In other words we have near-zero natural immunity to it, and children are particularly at-risk.  It's a nasty bug too, causing permanent harm including paralysis and even death in some of the kids who contract it.

Thus far it has killed at least 7, which is incidentally 7 more US citizens than have been killed by ebola that they contracted inside the United States.  More than 700 have fallen ill with it, nearly all children.

You don't think that allowing tens of thousands of illegal immigrant children to come into the country, intentionally dispersing them through the nation all summer long while refusing to disclose where they went after having intentionally failed to screen them for disease, then effectively forcing state and local governments to accommodate integrating them into our schools where they will expose our children to anything they may have carried with them across the border is the same thing as what "white man" allegedly did to the Native American with their smallpox blankets?

You're not very bright, are you?

Thank Obama and Congress for their refusal to enforce immigration laws -- they're directly responsible and whether it's a function of malfeasance or misfeasance dead is still dead.

Categories: Economics

The Market Ticker - CPI: +0.1%

The Market Ticker - 23 October 2014 - 12:42am

CPI came in at 0.1%, both core and headline.

Food was up 0.3% but energy was down large, -0.7%, offsetting it.

The stunners in the food area are whole meats; specifically beef and pork -- and especially beef, which is up nearly 20% on an annual basis.  Pork is up 11.4%, held down by chops.  I don't believe the bacon number, by the way -- it sure as hell is up more than 3.8% in my experience over the last year (closer to the 20% for "other" pork products.)

In fact regular fresh food products of the animal sort are all up big; fish (6%), dairy (4.9%), eggs (8.5%), etc.

Wanna eat low carb?  It's gonna cost you!

As for those who think deflation sucks, please explain in the context of televisions and computers, both of which continue their relentless and decades-long deflationary price trends.

Hourly earnings were down 0.2%, offset by an increase in working hours of one tenth to 34.6.  Work harder and get paid less, slave!

Categories: Economics
Syndicate content