Endgame ahead

Archive for the ‘Economics’ Category

Chris Martenson’s presentation on exponential growth

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In this video Chris Martenson, economic analyst at and author of ‘The Crash Course’, explains why he thinks that the coming 20 years are going to look completely unlike the last 20 years. In his presentation he focuses on the so-called three “Es”: Economy, Energy and Environment. He argues that at this point in time it is no longer possible to view either one of those topics separately from one another.

Since all our money is loaned onto existence, our economy has to grow exponentially. Martenson proves this point empirically by showing a 99.9% fit of the actual growth curve of the last 40 years to an exponential curve. If we wanted to continue on this path, our debt load would have to double again over the next 10 years. By continually increasing our debt relative to GDP we are making the assumption that our future will always be wealthier than our past. He believes that this assumption is flawed and that the debt loads are already unmanageable.

Martenson explains how exponential growth works and why it is so scary that our economy is based on it. In an example he illustrates how unimaginably fast things speed up towards the end of an exponential curve. He shows that an exponential chart can be found in every one of the three “E’s” for instance in GDP growth, oil production, water use or species extinction. Due to the natural limitations on resources, Martenson comes to the conclusion that we are facing a serious energy crisis.

This energy predicament is namely that the quantity of oil as well as the quality of oil are in decline. He shows that oil discoveries peaked in 1964 and oil production peaked 40 years later. Martenson also shows how our return on invested energy is rapidly declining — the “cheap and easy” oil fields have already been exploited. In 1930 the energy return for oil was 100:1 or greater. Today it is already down to 3:1 and newer technologies such as corn-based ethanol only provide a 1.5:1 return. Martenson predicts that the time in between oil shocks will get shorter and shorter and that oil prices will go much higher.

Not only oil but also other natural resources are being rapidly used up as well. At the current projected pace of use, known reserves for many metals and minerals will be gone within the next 10 to 20 years. The energy needed to get these non-renewable resources out of the ground is growing exponentially. So we live in a world that must grow, but can’t grow and is subject to depletion. The conclusion out of all this is that our money system is poorly designed and that we need to rethink how we do things as quickly as possible.

After finishing his presentation Chris Martenson answers questions regarding a rise in efficiency, alternative technologies and oil prices. He also responds to questions regarding electricity, shale gas, gold, silver, platinum, palladium, and uranium and the race for global resources.

This video was recorded on November 16 at the Gold & Silver Meeting 2011 in Madrid.

Written by mo

December 25th, 2011 at 3:11 pm

What About Money Causes Economic Crises? (with Peter Schiff)

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Rep. Ron Paul sponsored this Congressional lecture on “What About Money Causes Economic Crises?”, the concluding lecture in a three part series on the basic principles of money for Congressional staff. As a continuing educational tool this lecture was filmed and is provided to the public. The lecture was delivered by Peter Schiff, CEO of Euro Pacific Capital and author of Crash Proof: How to Profit From the Coming Economic Collapse and How an Economy Grows and Why It Crashes. Mr. Schiff explains the fact that the interest rate is a price and that manipulation of that price results in real changes to the capital structure and structure of production within the economy, causing imbalances, booms, and eventually busts in the economy. His lecture also explores how government intervention through labor and employment policies results in diminished employment and an overall reduction in the standard of living.

Previous videos in this lecture series can be found here:

Pt. 1: “What is Money?” —
Pt. 2: “What Is Constitutional Money?” —
Pt. 3: “What About Money Causes Economic Crises?” with Peter Schiff

Of course the talk is a little US-centric, but since nowadays (pretty much) the whole world¬† is based on the same monetary and economic principles, it’s well worth watching for anyone, even if you live outside the United States.

Written by mo

December 22nd, 2011 at 4:25 pm

UBS chief economist Hatheway on the euro collapse

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So, everyone is talking about the impeding eurozone collapse – but hey, seriously, how bad can it be? Well, just a few fun excerpts from a Dow Jones newswire quoting UBS chief economist Larry Hatheway in a letter to his clients:

Contingency planning for a currency breakup is also fruitless, Hatheway added. “That’s like asking Wellington to stress test his army against a scenario where Napoleon has a B-52 at Waterloo. You don’t re-position the troops–you retreat as quickly as possible across the Channel, if not across the Atlantic,” he wrote.

and even better

And amid all of the chaos, where should investors be allocating their assets? Precious metals feature highly on Hatheway’s shopping list, along with tinned goods and small calibre weapons.

So much for UBS confidence in politicians to do the right thing and get us out of this mess without fucking it up even more than now.

Written by mo

December 7th, 2011 at 2:54 pm

Posted in Economics,Europe

Tagged with ,

Today’s downgrades: Portugal and Hungary

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Citing uncertainty over the country’s ability to meet ‘austerity’ targets and its rising susceptibility to external shocks – given its heavy reliance on external investors – Moody’s just downgraded Hungary to Junk Ba1 (with a negative outlook). Yesterday pretty much the same thing happened to Portugal.

Upcoming candidates for (minor) downgrades: Austria, Japan, UK… and sooner or later Germany and the US.

Written by mo

November 25th, 2011 at 12:26 am

Posted in Economics,Europe

Tagged with ,

Kyle Bass: You can’t hate the mirror cause you’re ugly

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Kyle Bass unabridged interview on BBC’s hardtalk – 25 minutes well worth watching.

Quoting Zerohedge:

Reflecting on the similarities of his subprime perspective, he provides a crucial context for the debt-laden world of sovereign debt that he is now hedging. Shrugging off the somewhat snarky ‘nefarious short-sellers’ angle of questioning (and insuring the uninsured prod), he simply and elegantly points out how massively asymmetric the bet was, how the asymmetry in Europe has disappeared now, and all the asymmetry lies in Japan. From the 14-minute mark, describes the demographic disaster, destroys the savings myth of the land of the rising sun, and brings into focus how Italy’s rapid demise should be a forewarning for the debt-servicing of Japan.

Ending up on the Fed’s printing and the need for guns and gold, there’s a little here for everyone!

“Buying gold is just buying a put against the idiocy of the political cycle. It’s That Simple”

Written by mo

November 21st, 2011 at 12:38 am

Current hyperinflation: Argentina, Belarus, Vietnam, Venezuela

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Save Capitalism recently posted an update on the currently most hyperinflationary nations, together with some nice graphs illustrating the misery.

Or to put it in numbers, using Belarus as an example:

Belarus reported consumer price inflation at hyperinflationary levels of 92.3% in October, up from 79.6% in September, and 36.2% in the year to June, according to the National Statistic Committee, meanwhile the government is forecasting 2011 inflation of as much as 39%.

The Bank also said that interest rates on liquidity management operations would also increase, with the overnight deposit rate rising to 30% and the overnight credit rate rising to 60%.  The USD-Belarussian ruble (BYR) exchange rate has doubled on the black market, rising to as much as 7,000 per dollar (approx. 6,000 in July), and currently trades around 8795 (5350 in September) against the US dollar, according to quotes from Yahoo Finance.

Written by mo

November 20th, 2011 at 11:49 pm

Congression Insider Trading

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Just in case anyone had hopes of politicians getting the country (any country for that matter) out of the ditch we’re currently in. Watch the video and be amazed about just how fucked up politics in the US has become.

Written by mo

November 14th, 2011 at 1:41 pm

Berlusconi gone, Italy’s new PM: Mario Monti

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If you think Berlusconi was bad, just take a quick look at Mr. Monti’s bio:

Monti is a Praesidium member of Friends of Europe, a leading European think tank, was the first chairman of Bruegel, a European think tank founded in 2005, and he is European Chairman of the Trilateral Commission, a think tank founded in 1973 by David Rockefeller.[4] He is also a leading member of the Bilderberg Group.[5]

Monti is an international adviser to Goldman Sachs and The Coca-Cola Company.[6]

(Source: Wikipedia)

I’m pretty sure no further comment is necessary.

Written by mo

November 14th, 2011 at 12:37 am

Peter Schiff on taxes and capitalism

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A short (well, 14 minutes) introduction why more taxes and less capitalism will not get the results most people actually want.

Written by mo

October 15th, 2011 at 11:22 pm

Posted in Economics

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