The more I look into the future, the more I see my childhood, and that was a much smaller world, but small doesn't have to mean bad. Of course, as clueless rural white trash, I didn't realize my world was small, and of a lower energy intensity.
Riding my bike everywhere, eating local produce, minimal TV usage (only had 3.5 channels), no real air conditioning. It was actually quite a nice life from that standpoint, but also a very isolated life and we were dirt poor. I remember laying on my bed with my most prized possession, an AM/FM radio, thirsting for contact with the outside world. Or reading every page of the local paper, line by line, because there just wasn't anything else.
Of course isolation allowed the local population to be easily manipulated by politicians, and the politicians were universally corrupt. On the other hand cable news cuts the isolation, but increases the manipulation. So it all works out about even.
People are pretty clueless about how much of life's necessities are not really all that necessary. I get the feeling that before the year is out, they will find out.
As I've talked to my neighbors, trying to feel out just how unaware and mentally unprepared they are, I have noticed that they just don't even consider (or comprehend) economizing. At least not while they still have credit cards. They lifestyle really is non-negotiable, at least they think it is.
Monday, May 25, 2009
Sunday, December 14, 2008
Gestalt?
In retrospect, I never expected things to unfold like they have.
For the last couple of years I have been focused on peak oil/energy as the problem, but the reality was, that there were a multitude of problems, and peak oil was the precipitating event that collapsed a multitude of illusions. I think we may have been able to handle one or two problems, but not this many.
When oil prices surged these last couple of years, the tide went out, and it turned out that everyone was swimming naked. Sure, now that it has happened, it is so obvious, but not prior to these events. It just never occurred to me that everything would meld into such destructive disharmony.
Yes I knew that national and personal debt has been unsustainable for decades, that bankers were crooks, that farming practices were not sustainable, that energy policy was not sustainable, that climate chance was a problem, that politicians were corrupt and that nations would resort to “beggar thy neighbor” in a panic. However, what I never even considered, was that these separate circumstances would join together in a choir of such destruction.
Ooops.....
Beggar-thy-neighbor:
http://financial-dictionary.thefreedictionary.com/Beggar-thy-neighbor
Gestalt
http://www.merriam-webster.com/dictionary/gestalt
For the last couple of years I have been focused on peak oil/energy as the problem, but the reality was, that there were a multitude of problems, and peak oil was the precipitating event that collapsed a multitude of illusions. I think we may have been able to handle one or two problems, but not this many.
When oil prices surged these last couple of years, the tide went out, and it turned out that everyone was swimming naked. Sure, now that it has happened, it is so obvious, but not prior to these events. It just never occurred to me that everything would meld into such destructive disharmony.
Yes I knew that national and personal debt has been unsustainable for decades, that bankers were crooks, that farming practices were not sustainable, that energy policy was not sustainable, that climate chance was a problem, that politicians were corrupt and that nations would resort to “beggar thy neighbor” in a panic. However, what I never even considered, was that these separate circumstances would join together in a choir of such destruction.
Ooops.....
Beggar-thy-neighbor:
http://financial-dictionary.thefreedictionary.com/Beggar-thy-neighbor
Gestalt
http://www.merriam-webster.com/dictionary/gestalt
Saturday, November 29, 2008
What is really going to matter.
Because of the huge sums of money being poured into the financial bailouts, and the fact that we started with a huge national (and personal) debt, the USA is headed for "bankruptcy". This is the start of the second great depression (The Greater Depression).
By the time you have reached this sentence, you are either willing to accept the new reality, or dismissed what I've written and gone back to watching American Idol reruns. Come on back when you have been furloughed/laid off and continue reading.
The Greater Depression doesn't have to mean that everyone is going to go all mad max, but it does mean that only essential government services will continue. Even these essential services will be spotty and limited. These would be tax collection, law enforcement, national defense, sewer and water. Think “third world country”, and you get the idea. Americans will once again be totally dependent on themselves, like they haven't been for almost a century.
When I say spotty service, I mean don't expect the police to show up at a traffic accident, or the military to be building/maintaining high tech equipment. Unless people are dying violent deaths, don't expect a response.
NASA will be gone, most of the Armed Forces technical capability will be gone. Also on the block? Social security, Medicare, schools, road maintenance, the list is endless.
The era you are entering will have history books written about it, much like the American revolution or the great depression. If you think this is all bull, then stop reading and look up the phrase “cognitive dissonance” or the “five stages of grief “. Here is a hint, the first stage is denial.
For those still with me, consider what is important: water, food, shelter, clothes, waste disposal, security, medical and energy. If you are not providing one of these products or services, you will be unemployed, and stay unemployed. “They” will not be calling you back to work, period. Promises will be made, to make everyone go quietly, and maybe even believed by those making them, but eventually reality always wins. Severance pay? Unemployment insurance? Food stamps? Housing subsidies? Welfare? Don't count on it. Remember the government is bankrupt.
So what can we do? Build a bunker and stock it with MRE's?
Well, that may work for a little while, but not for long. We have some modern day examples of what happens in these situations. (Argentina, Yugoslavia, Cuba, North Korea..).
First lesson: Communities survive, not individuals. As much as you think you have prepared, you will not be ready for the violent struggle for survival.
Second: You have to have water. A clean accessible source of water is the greatest thing you can have. It waters crops, sustains the body and make life worth living.
Third: Food is not easy to grow or store. You need seeds, and chances are you don't have them. The right variety of crops for your soil and climate are essential. Then there are the pests: fire ants, Japanese beetles, rabbits, gofers, deer, the list is really long, and includes your neighbors. Even if you manage to harvest enough to survive winter you still have to preserve it. Do you know how to can food? Do you have the equipment? How about a root cellar or drying? Knowledge that our grand parents had, we do not, and relearning it will be an unpleasant experience.
Fourth: Heat prior to the advent of fossil fuel was from biomass. It takes a lot of wood to heat a house with a fireplace. They are not very efficient and the suburbs are not located in a forest. Plus, cutting, collecting and storing fuel is also a lost art. Note: Creosote is a great way to burn down you house!
Five: Security! Let us assume you are successful with items 1 through 4. Chances are, some one will notice how successful you are, then round up some of their friends and “share” in you success.
Time to start thinking about self sufficiency on a personal level!
By the time you have reached this sentence, you are either willing to accept the new reality, or dismissed what I've written and gone back to watching American Idol reruns. Come on back when you have been furloughed/laid off and continue reading.
The Greater Depression doesn't have to mean that everyone is going to go all mad max, but it does mean that only essential government services will continue. Even these essential services will be spotty and limited. These would be tax collection, law enforcement, national defense, sewer and water. Think “third world country”, and you get the idea. Americans will once again be totally dependent on themselves, like they haven't been for almost a century.
When I say spotty service, I mean don't expect the police to show up at a traffic accident, or the military to be building/maintaining high tech equipment. Unless people are dying violent deaths, don't expect a response.
NASA will be gone, most of the Armed Forces technical capability will be gone. Also on the block? Social security, Medicare, schools, road maintenance, the list is endless.
The era you are entering will have history books written about it, much like the American revolution or the great depression. If you think this is all bull, then stop reading and look up the phrase “cognitive dissonance” or the “five stages of grief “. Here is a hint, the first stage is denial.
For those still with me, consider what is important: water, food, shelter, clothes, waste disposal, security, medical and energy. If you are not providing one of these products or services, you will be unemployed, and stay unemployed. “They” will not be calling you back to work, period. Promises will be made, to make everyone go quietly, and maybe even believed by those making them, but eventually reality always wins. Severance pay? Unemployment insurance? Food stamps? Housing subsidies? Welfare? Don't count on it. Remember the government is bankrupt.
So what can we do? Build a bunker and stock it with MRE's?
Well, that may work for a little while, but not for long. We have some modern day examples of what happens in these situations. (Argentina, Yugoslavia, Cuba, North Korea..).
First lesson: Communities survive, not individuals. As much as you think you have prepared, you will not be ready for the violent struggle for survival.
Second: You have to have water. A clean accessible source of water is the greatest thing you can have. It waters crops, sustains the body and make life worth living.
Third: Food is not easy to grow or store. You need seeds, and chances are you don't have them. The right variety of crops for your soil and climate are essential. Then there are the pests: fire ants, Japanese beetles, rabbits, gofers, deer, the list is really long, and includes your neighbors. Even if you manage to harvest enough to survive winter you still have to preserve it. Do you know how to can food? Do you have the equipment? How about a root cellar or drying? Knowledge that our grand parents had, we do not, and relearning it will be an unpleasant experience.
Fourth: Heat prior to the advent of fossil fuel was from biomass. It takes a lot of wood to heat a house with a fireplace. They are not very efficient and the suburbs are not located in a forest. Plus, cutting, collecting and storing fuel is also a lost art. Note: Creosote is a great way to burn down you house!
Five: Security! Let us assume you are successful with items 1 through 4. Chances are, some one will notice how successful you are, then round up some of their friends and “share” in you success.
Time to start thinking about self sufficiency on a personal level!
Saturday, November 8, 2008
What comes next shouldn't be a suprise to anyone.
Can you say FDR style infrastructure projects?
Here is link to a 2003 Federal Reserve Bank of Dallas paper about "Monetary Policy in a Zero-Interest-Rate Economy". (pdf format)
You can't say the fed didn't tell everyone what they were going to do. They published their play book in 2003, and are currently following it.
1)Cut rates to zero. (if fails see #2)
2)Buy “Other domestic securities” (if fails see #3)
3)“The goods & services solution”
a) This article from FT.com makes the argument that the rate cuts didn't work.
"Fed capitulates: the central bank is broken" .
b) Considering the unemployment numbers, I would argue that the alphabet soup of fed facilities and bailouts ( buying up “Other domestic securities”) also didn't work.
c) Next up will be “The goods & services solution”. From the Fed paper:
“The strategy can be implemented, however, by coordination with fiscal policy-makers. The Federal government, for example, could purchase goods and services and finance the purchases with new debt, which the Fed in turn would buy–in technical terminology, the Fed would ‘monetize’ the resulting debt.”
Looks like the fed is going to resurrect inflation, even if they have to buy the Brooklyn bridge (literally). I would guess that massive infrastructure projects are going to be started. Probably more food stamps. This seems like a perfect ideology match for the new democratic government.
Oh well, we need expanded electric grid and rail service anyway to deal with peakoil.
Here is link to a 2003 Federal Reserve Bank of Dallas paper about "Monetary Policy in a Zero-Interest-Rate Economy". (pdf format)
You can't say the fed didn't tell everyone what they were going to do. They published their play book in 2003, and are currently following it.
1)Cut rates to zero. (if fails see #2)
2)Buy “Other domestic securities” (if fails see #3)
3)“The goods & services solution”
a) This article from FT.com makes the argument that the rate cuts didn't work.
"Fed capitulates: the central bank is broken" .
b) Considering the unemployment numbers, I would argue that the alphabet soup of fed facilities and bailouts ( buying up “Other domestic securities”) also didn't work.
c) Next up will be “The goods & services solution”. From the Fed paper:
“The strategy can be implemented, however, by coordination with fiscal policy-makers. The Federal government, for example, could purchase goods and services and finance the purchases with new debt, which the Fed in turn would buy–in technical terminology, the Fed would ‘monetize’ the resulting debt.”
Looks like the fed is going to resurrect inflation, even if they have to buy the Brooklyn bridge (literally). I would guess that massive infrastructure projects are going to be started. Probably more food stamps. This seems like a perfect ideology match for the new democratic government.
Oh well, we need expanded electric grid and rail service anyway to deal with peakoil.
Sunday, July 20, 2008
The End!
Well, this looks like “The End”.
The USA has accumulated so much debt that the system is about to collapse. Fannie Mae and Freddie Mac will be the straw that breaks the camels back. During the next couple of months foreign investors will lose faith in the dollar, treasuries and GSE (Freddie and Fannie) bonds. Add on top of that the inability of FDIC to cover all the failed banks and the American public are left in a truly deplorable situation.
The citizens, banks and government of the USA are insolvent. No one, will be able to save anyone, because they are all drowning.
If you want to buy anything, do it by the end of September, after that your money will be worthless.
It didn't have to be this way, regulations were in place, and powers granted to control the orgy of bad loans and worthless bonds. Alan Greenspan could have stopped this from occurring. Bush could have stopped this. Many a book will be written about why they didn't. I'm going to assume that the words “greed”, “power” and “arrogance” will be use to describe their actions.
What is really scary, is that I not convinced there is a "right thing" left to do. All options seem like different flavors of suicide.
It is pretty obvious that the foreign investor are going to simply leave in the next couple of months.
It is also obvious that the politicians are not going to go on an austerity program to pay the bills. Nor are they going to abandon their rich banker friends.
I would love to hear a WORKABLE solution that doesn't crash the economy.
Oh sure, there are “solutions”: devaluate the currency, make the bond holders take a haircut, put Freddie and Fannie in a conservatorship . But all those solutions mean the foreign investors who have artificially propped up the economy will leave.
Got Gold?
The USA has accumulated so much debt that the system is about to collapse. Fannie Mae and Freddie Mac will be the straw that breaks the camels back. During the next couple of months foreign investors will lose faith in the dollar, treasuries and GSE (Freddie and Fannie) bonds. Add on top of that the inability of FDIC to cover all the failed banks and the American public are left in a truly deplorable situation.
The citizens, banks and government of the USA are insolvent. No one, will be able to save anyone, because they are all drowning.
If you want to buy anything, do it by the end of September, after that your money will be worthless.
It didn't have to be this way, regulations were in place, and powers granted to control the orgy of bad loans and worthless bonds. Alan Greenspan could have stopped this from occurring. Bush could have stopped this. Many a book will be written about why they didn't. I'm going to assume that the words “greed”, “power” and “arrogance” will be use to describe their actions.
What is really scary, is that I not convinced there is a "right thing" left to do. All options seem like different flavors of suicide.
It is pretty obvious that the foreign investor are going to simply leave in the next couple of months.
It is also obvious that the politicians are not going to go on an austerity program to pay the bills. Nor are they going to abandon their rich banker friends.
I would love to hear a WORKABLE solution that doesn't crash the economy.
Oh sure, there are “solutions”: devaluate the currency, make the bond holders take a haircut, put Freddie and Fannie in a conservatorship . But all those solutions mean the foreign investors who have artificially propped up the economy will leave.
Got Gold?
Saturday, May 17, 2008
Hank Paulson and Ben Bernanke are a cornered animal?
http://www.minyanville.com/articles/dow-Bernanke-nasdaq-Paulson-crude-Fed/index/a/17152
“One of the best tidbits of advice I received as a young buck was to put yourself in the shoes of the person on the other side of your trade. See what they see. Think what they think. Keep your friends close and your counter-party closer! “
“Hank Paulson and Ben Bernanke have a clear mandate. They’re willing to mortgage our future with hopes that a legitimate economic recovery takes root. We’ve seen this movie before (on the back of the tech bubble) but memories are short given our immediate gratification societal mindset. They’ve got deep pockets. Interest rate cuts, Auction Facilities, discount windows, shifting collateral parameters, Working Groups on Financial Markets, interest on bank reserves, rebate checks, open-market operations and repurchase agreements are all at their disposal.
And if those don’t work, they seem intent on inventing intervention that does. We’ve written extensively about financial engineering and the inherent dangers thereof. The Federal Reserve balance sheet continues to drain as they attempt to fund the banking system. There are only so many bullets left in the gun and the last one will likely be pointed inward.
Still, we must respect the claws of a cornered animal. We’ve passed the point of no return and the government will do everything within (and potentially beyond) its powers to ensure the finance-based global balls remain in the air. You don’t have to agree with it, you simply have to respect it.”
I read this article Wednesday, and it has stuck with me like a pebble in my shoe.
I work for the federal government. As a physicist, I try not to get involved in politics, but on occasion, I do end up substituting for my boss in some very interesting meeting. The dynamics of how the federal bureaucrats think is reflected in the article.
Anyone who thinks that the federal government is intent on doing the right thing, needs a reality enema. Generally the front line people try to do the right thing, but once you pass the first line supervisors, it is just about power and ego. It is all about getting power, defending your power and the public be damned.
Hank and Ben have been given their orders, and if anyone things they are going to have a twinge of regret, or a last minute epiphany, you have not talked to very many bureaucrats.
Saturday, March 29, 2008
The score card up till now, and tomorrows forecast.
Ben Bernanke has stuck religiously to his play book during the current crisis. He has inflated the currency, and stopped bank failures at any cost. If you read his writings, from before his ascension to the throne, nothing so far will have surprised you.
The situation:
The housing bubble popped, the banks were shown to have no clothes, all branches of government were asleep at the wheel, and the only active players on the field are the banks and the Federal reserve.
Will government react to this crisis? No, or at the very least, not before a crash. You will hear plans and platitudes, investigations and calls for reform, but the two major parties need big buck for the election fight this year. There will be no perp walk for the people who bundle campaign contributions. (Or at least not till there are riots in the streets.)
At a chaotic inflection point in history, it is almost impossible to see which forces will triumph, but we can at the very least look at the major players.
Banks, Investment houses and the fed:
The banks aren't illiquid, they are insolvent, bankrupt, broke, a collapsed Ponzi scheme. They bet their investors money on the fantasy that growth will continue indefinitely, and lost. They are just a meaningless facade left in place to fool/fleece the public while gulping from the Federal Reserves tit. Their last big play will be by the individuals who looted them, as they try to bribe the politicians and the Federal reserve into a bailout/pardon.
A really important sub-thread of this, is that having an “account” with one of these institutions is just a promise, to give you money or shares. Until you close out your account, it is all just a promise, backed up by an insolvent institution.
Stocks:
The stock market crash of 29 did not cause the depression, it was caused by the depression. You really have to laugh at people who think stocks will hold value during a crisis. If your broker goes belly up, you are just another creditor. Even assuming you took physical ownership of your stock certificates, 1929 showed what happens to stocks. Add in the growing hatred of “speculators” and you will be lucky if you not arrested for shorting a stock.
Commodities:
It is my opinion that there is a general commodities bubble, and it is bursting. However, some commodities may continue to go up in price. Namely grains and energy. After looking at the data, it appears there are genuine shortages in these areas, and those shortages may even survive a major economic down turn. Although they will take an initial beating with all the other commodities, a real shortages trumps a bubble.
Unfortunately, the process used to invest in commodities isn't as straight forward as opening up a bank account “in oil”. As calls to reign in “speculators” rise the government may finally act (or conspire) to close the market to us humble mortals. (Poof! Goes your money!)
Gold, dollars, euros and yens:
Only a fool would keep his money in the constantly debased dollar at this point. The only problem is where to put savings, if not in dollars? Should we keep them in a bank/investment account? (Hell no!) How about a foreign bank? (You know, the ones that bough all the sub-prime mortgages.) Should you believe in the decoupling fairy? How about federal reserve notes stuffed under your mattress? (Not if a new currency is issued.)
The answer (unfortunately) is to invest in actual stuff. Even more unfortunate is that you can't keep you life saving in spam and bottled water. It won't fit in your house, besides, who the hell wants a house full of spam, and the utility company refuses to take payment in spam (or euros, or gold, or 9mm ammo........).
Foreign Investors:
These are the real wild cards in the equation. At what point do the foreign investors just leave? And if they leave, what happens?
A market crash will be the least of our problems if the foreign money takes a hike.
The federal government runs at a deficit. It spends more than it takes in, then borrows the rest. Much of that is borrowed from other countries. Will higher treasure rates lure them back? They might, if everyone and their brother weren't fleeing to treasures already, driving down the returns. If they loose faith they will ever be paid back, who would invest in a failing government?
My personal strategy is as follows:
Treasuries = 99% of my savings is in treasuries (I don't real have a choice all my saving is in a 401K.)
Home = Up till now, I have been paying off my home at a greatly accelerated rate. But I am pretty sure the loan is held by a “publicly-owned corporation chartered by Congress”. Can my loan get called in if the holder goes belly up? If the payment system locks up because of bank failures, will I be on hook for penalties?
Federal reserve notes and gold/silver = I have a little in a safety deposit box, but it is damn small amount. I may accumulate more, but I really don't know right now.
The situation:
The housing bubble popped, the banks were shown to have no clothes, all branches of government were asleep at the wheel, and the only active players on the field are the banks and the Federal reserve.
Will government react to this crisis? No, or at the very least, not before a crash. You will hear plans and platitudes, investigations and calls for reform, but the two major parties need big buck for the election fight this year. There will be no perp walk for the people who bundle campaign contributions. (Or at least not till there are riots in the streets.)
At a chaotic inflection point in history, it is almost impossible to see which forces will triumph, but we can at the very least look at the major players.
Banks, Investment houses and the fed:
The banks aren't illiquid, they are insolvent, bankrupt, broke, a collapsed Ponzi scheme. They bet their investors money on the fantasy that growth will continue indefinitely, and lost. They are just a meaningless facade left in place to fool/fleece the public while gulping from the Federal Reserves tit. Their last big play will be by the individuals who looted them, as they try to bribe the politicians and the Federal reserve into a bailout/pardon.
A really important sub-thread of this, is that having an “account” with one of these institutions is just a promise, to give you money or shares. Until you close out your account, it is all just a promise, backed up by an insolvent institution.
Stocks:
The stock market crash of 29 did not cause the depression, it was caused by the depression. You really have to laugh at people who think stocks will hold value during a crisis. If your broker goes belly up, you are just another creditor. Even assuming you took physical ownership of your stock certificates, 1929 showed what happens to stocks. Add in the growing hatred of “speculators” and you will be lucky if you not arrested for shorting a stock.
Commodities:
It is my opinion that there is a general commodities bubble, and it is bursting. However, some commodities may continue to go up in price. Namely grains and energy. After looking at the data, it appears there are genuine shortages in these areas, and those shortages may even survive a major economic down turn. Although they will take an initial beating with all the other commodities, a real shortages trumps a bubble.
Unfortunately, the process used to invest in commodities isn't as straight forward as opening up a bank account “in oil”. As calls to reign in “speculators” rise the government may finally act (or conspire) to close the market to us humble mortals. (Poof! Goes your money!)
Gold, dollars, euros and yens:
Only a fool would keep his money in the constantly debased dollar at this point. The only problem is where to put savings, if not in dollars? Should we keep them in a bank/investment account? (Hell no!) How about a foreign bank? (You know, the ones that bough all the sub-prime mortgages.) Should you believe in the decoupling fairy? How about federal reserve notes stuffed under your mattress? (Not if a new currency is issued.)
The answer (unfortunately) is to invest in actual stuff. Even more unfortunate is that you can't keep you life saving in spam and bottled water. It won't fit in your house, besides, who the hell wants a house full of spam, and the utility company refuses to take payment in spam (or euros, or gold, or 9mm ammo........).
Foreign Investors:
These are the real wild cards in the equation. At what point do the foreign investors just leave? And if they leave, what happens?
A market crash will be the least of our problems if the foreign money takes a hike.
The federal government runs at a deficit. It spends more than it takes in, then borrows the rest. Much of that is borrowed from other countries. Will higher treasure rates lure them back? They might, if everyone and their brother weren't fleeing to treasures already, driving down the returns. If they loose faith they will ever be paid back, who would invest in a failing government?
My personal strategy is as follows:
Treasuries = 99% of my savings is in treasuries (I don't real have a choice all my saving is in a 401K.)
Home = Up till now, I have been paying off my home at a greatly accelerated rate. But I am pretty sure the loan is held by a “publicly-owned corporation chartered by Congress”. Can my loan get called in if the holder goes belly up? If the payment system locks up because of bank failures, will I be on hook for penalties?
Federal reserve notes and gold/silver = I have a little in a safety deposit box, but it is damn small amount. I may accumulate more, but I really don't know right now.
Thursday, March 13, 2008
As the crisis deepens Part 1: Freezers/Refrigeration.
One of the things to consider as the crisis deepens, is that rolling blackouts and power outages will add to the burden of an already stressed population and economy. In a world of shortages, one thing you don't want, is to have your limited supply or food of perishable medicine to be destroyed by unreliable power.
I've been looking for a high efficiency 12 volt dc/110 ac freezer for a while now. Although I've know about Sundazer and Sun Frost for years, neither really suited my needs.
I wanted a chest style freezer that worked on 12v and 110ac, yet had a low enough power consumption that it could run off solar panels. Most 12v coolers are of the thermo electric variety. They are very inexpensive and pretty much useless (I have one). They provide little cooling for the power consumed.
Then I ran across the Coleman Stirling Power Electric Cooler. Which led me to the Engel freezers. The Danfoss compressor, in the Engel, is the same high efficiency one used in the Sundazer.
The Engel's is sold by Big Frog Mountain and Cabelas. I consider that a pretty good endorsement, since Big Frog has been doing the alternate energy thing since 1989 and I've always been pleased with the stuff I bought from Cabelas.
Engel is an Australian company, here is their link. They also sell kits for converting an existing cooler or building a freezer from scratch.
I've been looking for a high efficiency 12 volt dc/110 ac freezer for a while now. Although I've know about Sundazer and Sun Frost for years, neither really suited my needs.
I wanted a chest style freezer that worked on 12v and 110ac, yet had a low enough power consumption that it could run off solar panels. Most 12v coolers are of the thermo electric variety. They are very inexpensive and pretty much useless (I have one). They provide little cooling for the power consumed.
Then I ran across the Coleman Stirling Power Electric Cooler. Which led me to the Engel freezers. The Danfoss compressor, in the Engel, is the same high efficiency one used in the Sundazer.
The Engel's is sold by Big Frog Mountain and Cabelas. I consider that a pretty good endorsement, since Big Frog has been doing the alternate energy thing since 1989 and I've always been pleased with the stuff I bought from Cabelas.
Engel is an Australian company, here is their link. They also sell kits for converting an existing cooler or building a freezer from scratch.
Sunday, October 14, 2007
Of Trolls and Screamer.
The thing that always fascinates me is motive.
Whether we are talking about climate change, peak oil, air pollution, or whether the moon landings were real, you always have people willing to froth with religious fervor that, “it is not true”. I work with some of them and it is interesting to probe their thought processes.
Generally I find four root causes:
1) Selfishness: Some are quite open about this. The high performance/luxury vehicle makes them feel important and special. They will not give it up, no matter what the cost to others.
2) Hatred of the group promoting the issue: If party “X” is promoting it, then it must be bad.
3) Fun: They enjoy being a troll. It give them a sense of power. Here in the south I see a lot of this. People hang a rebel flag or act like a redneck, just to piss the rest of the country off. They love to watch the liberals dance in anger. It almost has reach the status of a sport.
4) Delusion: Never underestimate the need for people to delude themselves. Life can be really hard. Sometimes insisting that a perpetual motion machine works is part of their coping strategy for dealing with the loss of their job, loved one or social status. I see this with some of my evangelical friends. They were on a path to self destruction till they found “X”. Now that they have “X”, “It is in god's hands”.
Which isn't to say that dissent is not a valid and useful thing. It keeps science honest. In fact, at work I have pretty must taken on the role of dissenter. They call me “Mr. Sunshine”, because I always tell them the flaw in their big idea. The difference is, that I have had decades of experience in my field and actually know my subject. Sometimes they overcome the flawed logic, sometimes they don't. But to be a valid dissenter you need to know your subject and have real world experience in science and technology (as apposed to deluding yourself that you know a subject).
As a citizen in a democracy, we have several choices when science, politics and beliefs collide.
1) Read up on what real scientists are saying (not the TV talking heads) and accept their judgment.
2) Get a college degree for the field in question, then spend decades working in that field.
3) Read legitimate science literature and try and apply your life experience.
All three choices have problems:
Blind acceptance of authority is never a good thing.
College degrees are expensive and time consuming. If you tried for a degree in every field you had a question, you would spend your whole life in college. An this assumes you don't get the all important real life experience in that field, or that you are any good in your field of study.
Reading legitimate scientific literature is a good start but unless you have had years of science and technology experience in the real world, your going to make invalid assumptions.
Yes, I know this sounds elitist, but others have made some good comparisons on this subject. One of my favorites was second guessing the airline pilot every time you fly on a commercial airliner. Owning a flight simulator program is not a valid reason to break into the cockpit, and wrestle the controls from the pilot. Not if you want to keep living.
In the case of peak oil and climate change, I have used a three pronged approach.
1)I looked at what the experts had to say.
2)I then went looking for the data behind their conclusions.
3)Then I went looking for the dissenters to see what they had to say.
My advantage in looking into these subjects, is that I spent several decades in a large scientific bureaucracy working as a physicist. I was use to analyzing raw data and avoiding the inherent pitfalls. I am also use to dealing with how personnel self interest, or politics could distort findings. An organization does not willing publish information that cuts review streams.
In the final analysis, it all comes down to whether the predictions are true. Is the arctic melting? Is climate changing? Is oil getting more expensive? Are we drilling for oil in more remote and hostile environments?
If reality matches the predictions (or is worse than predicted), yet you keep coming up with excuses not to accept the data. Then it is time to take a real hard look in the mirror.
Whether we are talking about climate change, peak oil, air pollution, or whether the moon landings were real, you always have people willing to froth with religious fervor that, “it is not true”. I work with some of them and it is interesting to probe their thought processes.
Generally I find four root causes:
1) Selfishness: Some are quite open about this. The high performance/luxury vehicle makes them feel important and special. They will not give it up, no matter what the cost to others.
2) Hatred of the group promoting the issue: If party “X” is promoting it, then it must be bad.
3) Fun: They enjoy being a troll. It give them a sense of power. Here in the south I see a lot of this. People hang a rebel flag or act like a redneck, just to piss the rest of the country off. They love to watch the liberals dance in anger. It almost has reach the status of a sport.
4) Delusion: Never underestimate the need for people to delude themselves. Life can be really hard. Sometimes insisting that a perpetual motion machine works is part of their coping strategy for dealing with the loss of their job, loved one or social status. I see this with some of my evangelical friends. They were on a path to self destruction till they found “X”. Now that they have “X”, “It is in god's hands”.
Which isn't to say that dissent is not a valid and useful thing. It keeps science honest. In fact, at work I have pretty must taken on the role of dissenter. They call me “Mr. Sunshine”, because I always tell them the flaw in their big idea. The difference is, that I have had decades of experience in my field and actually know my subject. Sometimes they overcome the flawed logic, sometimes they don't. But to be a valid dissenter you need to know your subject and have real world experience in science and technology (as apposed to deluding yourself that you know a subject).
As a citizen in a democracy, we have several choices when science, politics and beliefs collide.
1) Read up on what real scientists are saying (not the TV talking heads) and accept their judgment.
2) Get a college degree for the field in question, then spend decades working in that field.
3) Read legitimate science literature and try and apply your life experience.
All three choices have problems:
Blind acceptance of authority is never a good thing.
College degrees are expensive and time consuming. If you tried for a degree in every field you had a question, you would spend your whole life in college. An this assumes you don't get the all important real life experience in that field, or that you are any good in your field of study.
Reading legitimate scientific literature is a good start but unless you have had years of science and technology experience in the real world, your going to make invalid assumptions.
Yes, I know this sounds elitist, but others have made some good comparisons on this subject. One of my favorites was second guessing the airline pilot every time you fly on a commercial airliner. Owning a flight simulator program is not a valid reason to break into the cockpit, and wrestle the controls from the pilot. Not if you want to keep living.
In the case of peak oil and climate change, I have used a three pronged approach.
1)I looked at what the experts had to say.
2)I then went looking for the data behind their conclusions.
3)Then I went looking for the dissenters to see what they had to say.
My advantage in looking into these subjects, is that I spent several decades in a large scientific bureaucracy working as a physicist. I was use to analyzing raw data and avoiding the inherent pitfalls. I am also use to dealing with how personnel self interest, or politics could distort findings. An organization does not willing publish information that cuts review streams.
In the final analysis, it all comes down to whether the predictions are true. Is the arctic melting? Is climate changing? Is oil getting more expensive? Are we drilling for oil in more remote and hostile environments?
If reality matches the predictions (or is worse than predicted), yet you keep coming up with excuses not to accept the data. Then it is time to take a real hard look in the mirror.
Saturday, September 29, 2007
Ben Bernanke and the great depression:
With a lame duck president, the future of the country seems to be in the hands of Mr. Bernanke. So I went looking for some insight in to how the man thinks.
The first thing I ran across is a review of his book, "Essays on the Great Depression” Reviewed for the Cato Journal by Anna J. Schwartz (April 6, 2002). I would have thought that anything from the libertarian CATO institute, would be a blistering attack on government intervention and on the fed in particular, but it was a very nice summary of the book. Which was exactly what I had wanted, since I didn't feel like wading through a book fully of economic jargon.
A very telling paraphragh from the review:
Sound a lot like todays sub-prime mess doesn't it. If I had read this before the last fed open market meeting I would have bet on the .5 rate cut.
The second item I ran across was: Remarks by Governor Ben S. Bernanke, At the Conference to Honor Milton Friedman, University of Chicago, Chicago, Illinois, November 8, 2002, On Milton Friedman's Ninetieth Birthday.
A quote from that speech :
Again if I had read this before the fed meeting I would have bet on the .5 cut. The news was full of “bank failures” and Bernanke is convinced that it is the feds job to stop these by any means necessary.
He even quotes Friedman about the great depression:
This is a man obsessed with bank failures and runs, but what does he think about the death of the dollar, due to high inflation and the dumping of the dollar as a reserve currency, that have resulted from his policies?
Evidently he thinks it is a good thing!
I'm not at all sure I agree. On the positive side, it is wiping out the federal debt (and everyone else's debt), at a remarkable rate. It also is causing oil to rise, which should cause more conservation. It should also slow or stop the export of jobs and manufacturing.
On the other hand it is going to become increasingly more difficult for retirees to live since their savings are not accruing faster than inflation, while the bogus “cost of living” adjustments of Social security will never keep up with inflation.
A very mixed bag. My brothers enormous mortgage and credit card debt is shrinking, but my fathers life savings are also shrinking. At the same time I have invested heavily in overseas stock markets. The death of the dollar is causing my investments to soar (at least on paper).
So I went looking for some more indications on how Ben viewed the inflation of the Weimar Republic, and found a lengthly endnote in one of his Fed speeches. From that endnote:
Read the rest of Endnote #16, it basically says that bubble popping if a really bad idea.
So Ben seems to think that inflation (even hyperinflation) is better than depression. At the same time the people happy about a strong dollar (like the Chinese) are going to get really shrill in their dislike of his policies. After all, pegging your currency against the dollar, is now the same thing as tying an anchor around your neck and jumping overboard.
Dollar verses Euro and Yuan.
The first thing I ran across is a review of his book, "Essays on the Great Depression” Reviewed for the Cato Journal by Anna J. Schwartz (April 6, 2002). I would have thought that anything from the libertarian CATO institute, would be a blistering attack on government intervention and on the fed in particular, but it was a very nice summary of the book. Which was exactly what I had wanted, since I didn't feel like wading through a book fully of economic jargon.
A very telling paraphragh from the review:
"Bernanke distinguishes at least two channels by which deflation induced depression. A nonmonetary channel that, in his view, linked falling prices and falling output was banking panics and financial crises in choking off normal flows of credit. The decline in financial intermediation that followed from the reduction in banks' ability to lend engendered a fall in the net worth of households and firms holding nominally fixed debt. The ensuing debt crisis increased the number of bankruptcies and became an important propagator of economic contraction."
Sound a lot like todays sub-prime mess doesn't it. If I had read this before the last fed open market meeting I would have bet on the .5 rate cut.
The second item I ran across was: Remarks by Governor Ben S. Bernanke, At the Conference to Honor Milton Friedman, University of Chicago, Chicago, Illinois, November 8, 2002, On Milton Friedman's Ninetieth Birthday.
A quote from that speech :
"It was in large part to improve the management of banking panics that the Federal Reserve was created in 1913. However, as Friedman and Schwartz discuss in some detail, in the early 1930s the Federal Reserve did not serve that function."
Again if I had read this before the fed meeting I would have bet on the .5 cut. The news was full of “bank failures” and Bernanke is convinced that it is the feds job to stop these by any means necessary.
He even quotes Friedman about the great depression:
“Germany had been insulated by her hyperinflation and associated floating exchange rate."
This is a man obsessed with bank failures and runs, but what does he think about the death of the dollar, due to high inflation and the dumping of the dollar as a reserve currency, that have resulted from his policies?
Evidently he thinks it is a good thing!
I'm not at all sure I agree. On the positive side, it is wiping out the federal debt (and everyone else's debt), at a remarkable rate. It also is causing oil to rise, which should cause more conservation. It should also slow or stop the export of jobs and manufacturing.
On the other hand it is going to become increasingly more difficult for retirees to live since their savings are not accruing faster than inflation, while the bogus “cost of living” adjustments of Social security will never keep up with inflation.
A very mixed bag. My brothers enormous mortgage and credit card debt is shrinking, but my fathers life savings are also shrinking. At the same time I have invested heavily in overseas stock markets. The death of the dollar is causing my investments to soar (at least on paper).
So I went looking for some more indications on how Ben viewed the inflation of the Weimar Republic, and found a lengthly endnote in one of his Fed speeches. From that endnote:
“More recent research has shown that attempted bubble popping by monetary policymakers played an even greater role in the onset of the Great Depression than we had thought. An insightful article by Hans-Joachim Voth (forthcoming) has shown how the German central bank, under the famous central banker Hjalmar Schacht, contributed mightily to the demise of the Weimar Republic by aggressively attempting to bring down stock prices in 1927. Schacht's policy was successful, in the sense that the stock market crashed. But investment plummeted as well, and the German economic boom of 1924-1928 degenerated into depression and played a role in the global slowdown. Ironically enough, Voth argues persuasively that in fact there was no bubble in German stock prices, so that Schacht's actions were purely destructive. “
Read the rest of Endnote #16, it basically says that bubble popping if a really bad idea.
So Ben seems to think that inflation (even hyperinflation) is better than depression. At the same time the people happy about a strong dollar (like the Chinese) are going to get really shrill in their dislike of his policies. After all, pegging your currency against the dollar, is now the same thing as tying an anchor around your neck and jumping overboard.
Dollar verses Euro and Yuan.
Friday, August 17, 2007
Tasting the Wind:
Zbigniew Brzezinski's warning of an American "False Flag" terrorist incident, to rally support for invading Iran.
Right-wing Philadelphia Daily News scribe Stu Bykofsky openly wishing for a second 9/11, "To save America". Then getting major support from other Right-wing media outlets.
Sometimes facts and figures just don't cut it. Sometimes, you need to taste the wind and say, “Storms A'comin”. To take seemingly unrelated facts (“chatter”) and discern the underlying truths, takes wisdom, humility, an inner voice and dumb luck.
So I will come right out and say it, “Storms A'comin”. By putting this on the web I am going out on a limb, but nothing ventured.............
There are to many little factoids that seem to add up to aggression in a relatively short window. And my inner voice is starting to get uneasy. Between now and the end of the year one of the parties in the GWOT are going to make a move.
Also, I just don't think that W is willing to leave office without one more tilt at the windmill. A modern Don Quixote still oblivious to the results of his actions.
Of course, “Man plans and god laughs”. So all the plans and hubris of both side may never materialize if a hurricane takes out Gulf of Mexico oil production, but.........
A Mexican pipeline bombing showed to much sophistication for a leftist guerrilla group.Declaring part of the Iranian army a terrorist organization.
Zbigniew Brzezinski's warning of an American "False Flag" terrorist incident, to rally support for invading Iran.
Right-wing Philadelphia Daily News scribe Stu Bykofsky openly wishing for a second 9/11, "To save America". Then getting major support from other Right-wing media outlets.
The Mortgage credit disaster and the housing bubble, are not that different than the tech bubble that burst just before 9/11. To save the economy do we start another war?
I will say right up front, I am not a fan of the GWOT. I think we spent our time since 9/11 creating an atmosphere that encourages terror and is eroding the constitution.
What I am trying to address here is trying to predict the future, when the parties of importance would just as soon you not know in advance. 9/11 and Iraq's WMD comes to mind. Pre-9/11 warnings were ignored and WMD “proof” contained little of substance.
When tasting the wind, you don't want to actually read the story, that would only allow lies, half truths, misdirection and the writers illiteracy about he subject to distract you.
Who is pushing what world view is the important question. Who is embracing a story? Who is not reporting it? Where is the stories located, on the front page or in a blog?
The problem is that people tend to lie. I'm not talking about “Who shot JFK?” or “Area 51”, but people often have a selfish agenda that is contrary to the good of their neighbors, country and planet.. If they talked about what they were going to do, people would try and stop them, so they lie.
Look at Huey Long
Don't expect the mainstream media to warn you about the future. They are in the business of selling advertising, getting access to politician and not getting sued.
Saturday, July 14, 2007
Where to live/retire in a post peak world?
I've been giving a lot of though about were I want to live for the rest of my life. My dream is to buy a small piece of land and live “off the grid”, while doing subsistence farming, but there are many external factors to consider.
For me, this research is more about being sick of the rat race and wanting a simpler/healthier lifestyle, in a post peak oil world.
Among the items I'm considering are: Water, Taxes, population density, population demographics, real estate prices, soil quality, natural hazards, alternate energy potential, cultural environment, access/cost of pharmacies and health care.
Water ( rainfall for crops, access to clean fresh drinking water): If you don't have water nothing else matters. Drought prone areas with high population density and poor access to clean drinking water are just a disaster waiting to happen. Regardless of what happens with oil supplies and climate, only a fool would live in such a place.
Trend in annual temperature and rainfall
Climate maps
For drought monitoring use this link
Taxes: As has been pointed out ad nauseam, in a post peak oil world local governments will be hard pressed to maintain essential services. Right behind water supply will be the problem of a shrinking tax base and increased operating costs.
It is really tough to find a current and comprehensive review of taxes (by county) in the USA. Although some sites have a significant amount of information. When I check that information against the facts on the ground I find is very incomplete. Although state income, sales and real estate taxes are not that difficult to find, it is the county, city and school taxes that are the big problem.
I found a couple of sites that had good tax information, but when I checked it against places I know, I found it to be missing a considerable amount of the tax burden. In particular, back in my home town the school taxes and money owed by the county due to embezzlement by the county commissioners were not listed. None the less, these are two really good places to start.
Retirement Living: Taxes by state.
National Association of Home Builders: Residential Real Estate Tax Rates in the American Community Survey
Population density and population demographics: The census bureau provides this information.
Once in a particular thematic map you can switch from state to county view and change the data classes to give a better view. I prefer the quantile classing method and the county view.I think it is important to look at the population density and the AGE of the population. While and aging population is going to impose a greater tax burden on the local government it will also be less likely to riot (if for no other reason than they don't have the stamina).
Real estate prices: Very easy to find thanks to http://www.realtor.com/
Natural hazards (flooding potential, wild fires, earthquake potential, hazardous weather conditions): NOAA Billion Dollar U.S. Weather Disasters and Latest Earthquakes in the USA.
Alternate energy potential: U.S. Solar Radiation Resource Maps, Wind resources.
Soil Quality: http://soils.usda.gov/
PS: Although this sounds like building a “life boat” for the hard times ahead, it's not.
I don't believe that an individual can create a fortress against unstable times. If lawlessness and violence were to become commonplace, someone would simply come and kill me, then take all my stuff. After all, I'm just one guy, eventually I have to sleep or I'll get sick. If thinks were to get really bad, no place will be safe. Think about what has happened to Yugoslavia or what Argentina experienced in 2001.
Here is a good write up to of what happened in Argentina in 2001 , from someone who lived through it. It was originally a series of posts on the survivalist web site forum http://www.frugalsquirrels.com/
Sunday, May 13, 2007
End of an Era!
The “lightweight” version of history taught in most public schools, will probably show that “The Golden Age” for the USA ended in 2000 with the Tech Bubble. It will then tell how economic momentum and clever bookkeeping, allowed us to coast forward for a couple of years.
As a resident of this era, your higher though processes have probably not noticed its end. Mostly because you're busy just trying to get through life, but also because of some very fancy footwork by the federal reserve and some pretty blatant fraud by government agencies that report statistics.
Here is a link to help you understand why you haven't noticed the end (you can skip the first part if you want, and just scroll way down to the chocolate cake).
I'm tempted to start this blog by elaborating on how we got ourselves into this mess, but I will leave it for now. It's pretty must just the same old reasons: greed, politics and self delusion.
But what we all want to know is, what will happen next??????
I wish I had a simple answer for you, but the reality is we are walking a tightrope between two economic extremes. They may manifest themselves in the more destructive form of depression and hyperinflation or they may show up as recession and inflation. The federal reserve, congress and the American people will be the deciding factors.
However, there are some certainties:
Gas prices will continue to follow their erratic path upward. Demand has simply exceeded supply. So until the economy tanks, don't expect any relief. You can blame the oil companies, OPEC and the government (and they all do get part of the blame), but the biggest culprit will be found by looking in the mirror. The refusal of the American people to accept that they ran out of oil in the 1970's is the root cause. Don't expect any technical fixes from ethanol, hydrogen and alternate energy. Those are pretty much part of the whole “greed, politics and self delusion” paradigm.
Food prices will also rise. Mostly because everything is grown elsewhere in the world, then flow, shipped and trucked to us. Only a small percent of people get their food from local sources.
Beyond those two points, it all depends on whether we go inflationary or recession.
Inflation: From the looks of things, the Federal Reserve has chosen inflation. They keep printing money, while the government keeps adjusting the economic indicators to make it look like we are not experiencing inflation. Here are a couple of links if you want to see how they are doing it.
http://www.financialsense.com/fsu/editorials/2007/0416.html
http://www.shadowstats.com/cgi-bin/sgs?
Much like the pre great depression stock market, this depends on keeping the public fooled into business as usual (keep borrowing money for houses and cars). All we need is some event to start a panic, and we end up on the other side other tightrope.
On the positive side, inflation makes all that foreign debt worth less. On the negative side it also makes your taxes go up and your social security check worthless.
Recession: Gas shortages, terrorist attack, bad hurricane season, war or someone peeking behind the wizards curtain, it really doesn't matter. People will stay home and not buy things, but especially they will not buy big things like cars and houses. Unemployment will rise, and we will start having riots.
The Final Certainty is shortages:
Regardless of inflation or recession, eventually there will not be enough oil to meet demand, or it will be so expensive you can't afford it. Both scenarios lead to the same destination. It's just the speed and route that are different. Ultimate we will start to experience shortages. First it will be gasoline, then food, then electricity, then clothing..... Well, you get the idea.
In the short term, the gas shortage will follow this script:
PRE-EVENT
1) Up to now, mostly Eyewash: Calls for research, Compact florescent bulbs and drilling on those tiny (on a percent basis) patches of untouched North American land and sea.
2) Currently: Calls for conservation and higher CAFÉ standards, always to be implemented sometime in the future. Congress and the president know what is coming, but lack the intelligence and will to minimize the impact.
POST-EVENT
1) Nothing to see here, just move along! Lots of speeches with fake outrage and blaming the oil companies. Meanwhile prices spiral up, but no useful actions are taken. Everyone hopes the monster just goes away like it did before.
2) Weak Rationing! Either by tax increases or the alternate day license plate scheme. Also return of the 55 mph speed limit.
3) Strong rationing! Using either coupon or smart card. Limits on how much you can buy. Speed limit lowered to 50 mph
4) Government, agriculture and food/fuel transport use only.
5) Re-alignment of society.
When I say “Re-alignment of society”, I don't mean real life road warriors doing Mad Max interpretations. Other modern societies have experienced the loss of oil supplies and survived. The still have police and armies. Unfortunately they also had (and continue to have) massive society wide starvation. The two country that come to mind are Cuba and North Korea. During the Cold War the were supplied with, essentially, a free unlimited supply of oil. When the Soviet Union collapsed, their mechanized, oil powered, centrally managed farms, ground to a halt. It was and is the main factor for making life in those countries even more unpleasant then it was during the cold war.
Why?:
Surplus energy is the difference between a complex civilization, and a bunch of isolated tribes. You must produce enough surplus energy, beyond mere subsistence levels, if you want a complex civilization.
Politicians, scholars, stock brokers and a host of others, do not really contribute anything essential to a society. But once you reach the point where you have enough to survive, humans always want more!!!
First it was silk and spices from the far east, to stimulate the senses. Then books to stimulate the mind, and newspapers to link you to the outside work. Not long after that, you wake up one morning in a "service" economy run by lawyers and accountants. All this occurs because you have enough of an energy surplus (food), to feed all the hair stylists and news anchors.
When fossil fuel was discovered, humanity gained an enormous bonanza. It had a far greater energy density than draught animals, food or wood. They call it “horsepower” for a reason. We now had an enormous surplus of energy. Until it started to run out!
If you don't believe we are running out of cheap oil, then ask yourself these questions. Why are we drilling for oil in such inhospitable places like the arctic and the deep ocean? Why do we keep financing terrorism, by buying oil from people who want to kill us?
Understanding:
To truly understand what is coming, we need to understand how much our lives currently rely on oil and gas!!!!
Food: Diesel tractors plant and harvest it, natural gas provides the fertilizer and oil based pesticides keep it healthy. Then diesel powered trucks and trains bring it to you.
Clothing: Wear cotton? See the entry on food. Wear synthetics? Then you are wearing petroleum.
Shelter: Live in a wooden house? See the entry on food. Live in a steel, concrete or brick house? Then you live in house made with oil and gas.
Heat: If you heat your house with oil or gas, the answer is obvious. If you use a heat pump, then you should know that the coal and nuclear fuel are transported to the power plant by truck and train, as are the people who operate the power plant.
After thoughts:
Like the great depression, the reality the publics perceives of , "when the troubles started", is kind of false. What the American public perceives as the “start”, is really just the point where it starts to effect them personally. The reality is that the end of the “Golden Age” was in 1970's with the peaking of oil production in the lower 48 state, and the 1973 OPEC oil embargo. We have just been living off the stored economic fat of the country since then. We have maximized this stored fat, by increasing productivity with computers. (Remember playing “telephone tag” at work, back before email).
Meanwhile, a compliant news industry distracted us with assorted fluff and mindless cheer leading. While assets and jobs left the country, and massive dept was accumulated.
As a resident of this era, your higher though processes have probably not noticed its end. Mostly because you're busy just trying to get through life, but also because of some very fancy footwork by the federal reserve and some pretty blatant fraud by government agencies that report statistics.
Here is a link to help you understand why you haven't noticed the end (you can skip the first part if you want, and just scroll way down to the chocolate cake).
I'm tempted to start this blog by elaborating on how we got ourselves into this mess, but I will leave it for now. It's pretty must just the same old reasons: greed, politics and self delusion.
But what we all want to know is, what will happen next??????
I wish I had a simple answer for you, but the reality is we are walking a tightrope between two economic extremes. They may manifest themselves in the more destructive form of depression and hyperinflation or they may show up as recession and inflation. The federal reserve, congress and the American people will be the deciding factors.
However, there are some certainties:
Gas prices will continue to follow their erratic path upward. Demand has simply exceeded supply. So until the economy tanks, don't expect any relief. You can blame the oil companies, OPEC and the government (and they all do get part of the blame), but the biggest culprit will be found by looking in the mirror. The refusal of the American people to accept that they ran out of oil in the 1970's is the root cause. Don't expect any technical fixes from ethanol, hydrogen and alternate energy. Those are pretty much part of the whole “greed, politics and self delusion” paradigm.
Food prices will also rise. Mostly because everything is grown elsewhere in the world, then flow, shipped and trucked to us. Only a small percent of people get their food from local sources.
Beyond those two points, it all depends on whether we go inflationary or recession.
Inflation: From the looks of things, the Federal Reserve has chosen inflation. They keep printing money, while the government keeps adjusting the economic indicators to make it look like we are not experiencing inflation. Here are a couple of links if you want to see how they are doing it.
http://www.financialsense.com/fsu/editorials/2007/0416.html
http://www.shadowstats.com/cgi-bin/sgs?
Much like the pre great depression stock market, this depends on keeping the public fooled into business as usual (keep borrowing money for houses and cars). All we need is some event to start a panic, and we end up on the other side other tightrope.
On the positive side, inflation makes all that foreign debt worth less. On the negative side it also makes your taxes go up and your social security check worthless.
Recession: Gas shortages, terrorist attack, bad hurricane season, war or someone peeking behind the wizards curtain, it really doesn't matter. People will stay home and not buy things, but especially they will not buy big things like cars and houses. Unemployment will rise, and we will start having riots.
The Final Certainty is shortages:
Regardless of inflation or recession, eventually there will not be enough oil to meet demand, or it will be so expensive you can't afford it. Both scenarios lead to the same destination. It's just the speed and route that are different. Ultimate we will start to experience shortages. First it will be gasoline, then food, then electricity, then clothing..... Well, you get the idea.
In the short term, the gas shortage will follow this script:
PRE-EVENT
1) Up to now, mostly Eyewash: Calls for research, Compact florescent bulbs and drilling on those tiny (on a percent basis) patches of untouched North American land and sea.
2) Currently: Calls for conservation and higher CAFÉ standards, always to be implemented sometime in the future. Congress and the president know what is coming, but lack the intelligence and will to minimize the impact.
POST-EVENT
1) Nothing to see here, just move along! Lots of speeches with fake outrage and blaming the oil companies. Meanwhile prices spiral up, but no useful actions are taken. Everyone hopes the monster just goes away like it did before.
2) Weak Rationing! Either by tax increases or the alternate day license plate scheme. Also return of the 55 mph speed limit.
3) Strong rationing! Using either coupon or smart card. Limits on how much you can buy. Speed limit lowered to 50 mph
4) Government, agriculture and food/fuel transport use only.
5) Re-alignment of society.
When I say “Re-alignment of society”, I don't mean real life road warriors doing Mad Max interpretations. Other modern societies have experienced the loss of oil supplies and survived. The still have police and armies. Unfortunately they also had (and continue to have) massive society wide starvation. The two country that come to mind are Cuba and North Korea. During the Cold War the were supplied with, essentially, a free unlimited supply of oil. When the Soviet Union collapsed, their mechanized, oil powered, centrally managed farms, ground to a halt. It was and is the main factor for making life in those countries even more unpleasant then it was during the cold war.
Why?:
Surplus energy is the difference between a complex civilization, and a bunch of isolated tribes. You must produce enough surplus energy, beyond mere subsistence levels, if you want a complex civilization.
Politicians, scholars, stock brokers and a host of others, do not really contribute anything essential to a society. But once you reach the point where you have enough to survive, humans always want more!!!
First it was silk and spices from the far east, to stimulate the senses. Then books to stimulate the mind, and newspapers to link you to the outside work. Not long after that, you wake up one morning in a "service" economy run by lawyers and accountants. All this occurs because you have enough of an energy surplus (food), to feed all the hair stylists and news anchors.
When fossil fuel was discovered, humanity gained an enormous bonanza. It had a far greater energy density than draught animals, food or wood. They call it “horsepower” for a reason. We now had an enormous surplus of energy. Until it started to run out!
If you don't believe we are running out of cheap oil, then ask yourself these questions. Why are we drilling for oil in such inhospitable places like the arctic and the deep ocean? Why do we keep financing terrorism, by buying oil from people who want to kill us?
Understanding:
To truly understand what is coming, we need to understand how much our lives currently rely on oil and gas!!!!
Food: Diesel tractors plant and harvest it, natural gas provides the fertilizer and oil based pesticides keep it healthy. Then diesel powered trucks and trains bring it to you.
Clothing: Wear cotton? See the entry on food. Wear synthetics? Then you are wearing petroleum.
Shelter: Live in a wooden house? See the entry on food. Live in a steel, concrete or brick house? Then you live in house made with oil and gas.
Heat: If you heat your house with oil or gas, the answer is obvious. If you use a heat pump, then you should know that the coal and nuclear fuel are transported to the power plant by truck and train, as are the people who operate the power plant.
After thoughts:
Like the great depression, the reality the publics perceives of , "when the troubles started", is kind of false. What the American public perceives as the “start”, is really just the point where it starts to effect them personally. The reality is that the end of the “Golden Age” was in 1970's with the peaking of oil production in the lower 48 state, and the 1973 OPEC oil embargo. We have just been living off the stored economic fat of the country since then. We have maximized this stored fat, by increasing productivity with computers. (Remember playing “telephone tag” at work, back before email).
Meanwhile, a compliant news industry distracted us with assorted fluff and mindless cheer leading. While assets and jobs left the country, and massive dept was accumulated.
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