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Olduvai Cliff-UK edition

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  • Olduvai Cliff-UK edition

    Crops are a trainwreck and thats old news. India blacked out last month and left most of the country in the dark for near a week. This is just the warm up, the fat lady is smearing on the lipstick and the stage hands are out testing the mic. The minute the OIympics end its off a cliff the UK goes. Guaranteed.

    [url]http://www.guardian.co.uk/business/economics-blog/2012/mar/29/north-sea-oil-revenue-squandered[/url]

    Getting on for four decades later, North Sea resources are running dry. Figures released by the Department for Energy and Climate Change on Thursday showed that oil production in 2011 was more than 17% lower than in the previous year. A total of 1.04m barrels a day was pumped, down from a peak of 2.7m in 1999, and the lowest since the 1970s. Gas imports were higher than production for the first time since 1967, the year the Beatles released Sgt Pepper.
    Britain combined debt (private-corporate-govt) makes the Greeks, Spaniards and the Eye-ties look like fiscally sane adults. In a country the same size as Michigan with 60 million people two thirds over agricultural carrying capacity becoming a net importer of anything whilst relying on finance and debt as an export is like showing up in the HA's clubhouse wearing a pink tutu singing show tunes and wondering who are all these weird men, and why are they leering at me. Ugly. North Sea off a cliff and Britain is burning peat to keep warm this winter. Next year it will be furniture and wheelbarrows of British Pounds. The year after they will be sawing each others heads off and turning each other into biodiesel. Rest of the world isn't much behind. Our central banking overlords have put us into a low/no growth synthetic depression and kept us there in the hopes that everything mathematical simply upped and dissappeared.

    Now you know why all the 'rebels' in Syria and Libya speak Farsi/Arabic with a London accent. And why the Anglo press refuses to drop the dime on its own domestic debt situation two times worse than anybody else. Grab the popcorn, and pass the corona this suckers going down like a 40 dollar hooker at a shriners convention.

  • #2
    Dude who came up with Olduvai theory built Lear jets and devised power systems. This isn't some marxist axe grinder. Dude had math in his head and his case is just about air tight, bullet proof and ready for the global Wiley E. Coyote moment. Oil companies started lay offs up here this summer. 90 dollar oil ain't high enough and the tarsands are going to see another 2008 moment where construction simply stopped overnight not to be resumed for years after. This is the second waterfall of a triple waterfall on deck. This one will make the first one look like a kiddy slide, the third will just be a long agonizing slide into oblivion.

    [url]http://in.reuters.com/article/2012/08/09/column-kemp-oil-nsea-idINL6E8J980Y20120809[/url]



    Western post-industrial civilization = stick a fork in it.

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    • #3
      Most interesting and chilling chart that I have seen to date! Unfortunately, it may be a tad too optimistic with the 2030 date.

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      • #4
        Thirsty,that is a very interesting diagram that makes a LOT of sense!!Thanks for posting it.

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        • #5
          Looks to me like we need another world war.

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          • #6
            Great thread! What is it with host countries trying to showcase their economic prowess during the Olympics? In 2008 China was importing everything they could just to show people they could when it was their turn. The hour of the closing ceremony their economy along with the global financial system crossed the finish line and puked on the track, then fell onto the vomit and writhed there for a good year.

            Nationalism, or something like it, must drive countries to act as they themselves are individuals with something to prove. The Olympics seem to bring out the best in individuals and the worst in Nation-States. In 1980 America boycotted the Olypics because.... Russia was in Afganistan.

            It piszes me off that what should be a celebration of individual human achievement became a bunch of Nationalist display of small-wiener-syndrome. This is where the Central Banking angle comes in. These guys don't understand that high prices cure high prices, low prices cure low prices, and the cure for a recession is a recession. Until the mal-investment is cleared away like underbrush from the forest, we will never have economic growth. Add in resource constraints and poof, it's back to 1800s again. We need more Capitalism in a resource constrained world, not less.

            Interesting about the investment in oil drilling falling off with present oil prices. More about that in a moment.....

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            • #7
              My point above about Central Bankers is that they operate as though it's their job to save the economy. These guys think they are Usain Bolt, with all eyes on them and they want to impress the world. The economy ain't about them.

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              • #8
                Central Banks are to be ignored. Use the ever increasing supply of dollars, Euros, Yens, or whatever to your favor, when possible. Never hold long term wealth in currency. Worry about increasing wealth not currency.

                Central Bankers get way too much credit for their ability to solve economic problems. In the same vein, there are plenty of doomers who give them way too much credit for their ability to destroy civilization.

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                • #9
                  Originally posted by Grainbelt2 View Post
                  Central Banks are to be ignored. Use the ever increasing supply of dollars, Euros, Yens, or whatever to your favor, when possible. Never hold long term wealth in currency. Worry about increasing wealth not currency.

                  Central Bankers get way too much credit for their ability to solve economic problems. In the same vein, there are plenty of doomers who give them way too much credit for their ability to destroy civilization.

                  "We give central banks too much credit for their ability to destroy civilization?" Hmmmm........ How to explain this so the masses will get it before they get bored.....

                  Suppose you had your own bank with 100% reserves instead of the usual 5% reserves. Could you loan money at a competitive interest rate? No. The guys leveraged twenty to one don't need much for an interest rate and you do. How could you possibly hope to survive with honest (100% reserves is honest) banking? You would wait for the inevitable bank run to wack your competitors who engage in the inherently fraudulent practice of fractional reserve lending. At least that's what you would do if there was no Fed.

                  There were 100% reserve banks before the Fed and those conservative banks rapidly picked up market share because bank runs would make them look smart. They could pay their depositors and remain in business unlike the crooks.

                  The Fed was created by the large NY banks who couldn't resist the temptation of fractional reserve lending. The purpose was to force all banks to stand next to the cliff. By institutionalizing fractional reserve lending, it forced the 100% reserve banks to take more risk or close their doors. That way when the bank run came, there was no heroes left to pick up market share from the risk takers.

                  By imposing Moral Hazzard via FDIC and providing liquidity to the kamikaze banks, you can bet not only are there no 100% reserve banks left, but that every bank is standing as close to the cliff as every other bank. When a liquidity trap gets sprung, the outcome is so catastrophic that total government takeover of markets is the only path without complete and instant Mad Max.

                  -------------------------


                  Here is the natural outcome of allowing pure Lassaiz Faire to rule without Central Banks..... 100% Reserve Banking. They are the only banks to withstand the demo derby that bank runs create. The thing people don't understand is that bank runs are the most vital form of FINANCIAL REGULATION ever created. The more often bank runs occur, the less systemic risk the system has, and the more market regulation works its magic.

                  If you are interested, I will describe for you in great detail EXACTLY what the future will look like if central banks continue to institutionalize fractional reserve lending. I can describe perfectly how it looks, smells, and feels in great detail, the order everything happens in, and the final outcome.

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                  • #10
                    2012. After seeing that narcissistic Olympics and the closing Ceremony of freaks, the more I am convinced we are truly living in the Last Days. The Olympics were nothing more than man spitting in the face of God. Total self worship exhibited at every turn. We are approaching dangerous times, make no mistake about it. We are right now living in the calm before the storm. I think CBOT prices are the least of our worries.....time for us to get our lives in order.

                    We are at the edge of the abyss.....

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                    • #11
                      [FONT="Comic Sans MS"][SIZE="4"]Awh come on db have another piece of cake and glass of Kool-aid. [/SIZE][/FONT]

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                      • #12
                        Cheers! lmao

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                        • #13
                          I scratch my head and wonder how the US government sells bonds with any length at current prices if investors believe currency devaluation or dramatically increasing prices are just around the corner.
                          Investors don't influence the bond market, the Fed does. The Fed is the only buyer of Treasuries to any significant degree. After that a pile of foreign CB's and then maybe some of the bigshot bond funds. Ma and Pa investor is just a fart in a wind storm.

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                          • #14
                            While still relevant to a degree, Central Banks pale in influence to demographics (now). Resource constraints are also a major headache and it is an odd world we are living in which the main engine of growth over the last centuries (the western hemisphere) has a 1990 Japan like population distribution which only leads to deflation, whilst the developing world has a Mount Fuji like pop. pyramid that will cause yet untold price inflation in commodities. Depending where you live on this planet you are either dealing with a long term soul crushing deflation in domestic (especially leveraged) assets, while basic foodstuffs and raw materials become priced out of reach. Or you just see an across the board general price inflation in all asset classes because you don't live in the western hemisphere. Of course there are exceptions, I'd hate to be Joe Camel Sixpack living in the middle east - ugh.

                            Anyways, back to the present. I really don't know how present day tax everything into the ground spend more than it takes in Nanny state political economic philosophies last five minutes in this enviroment. The whole business model is busted. The state is reliant on growth in order for its economy to function in a fully liquid manner. With their busted demographics and resource constraints on the other side of the ledger acting as a drag on growth and thus the ability of the nanny state to bleed its population dry (falling tax revenue), even the pretense of paying the interest on these ultra low interest Govt bonds falls into question. The question isn't why interest rates are so low.... Its whats going to happen when even at ZIRP the nanny state is unable to rollover its debt, or even service the interest component on its debt. Greece gave the world Democracy and Britain the Parliamentary system, and so the two shall follow one another into bankruptcy, with the rest of the western hemisphere right behind. Liquidating centuries of self entitlement will be one for the history books.

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                            • #15
                              Leverage is suicide.

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