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Art Cashin: "Is US Economic Growth Over?"

Tyler Durden's picture




 

As investors' and traders' attention spans diminish at ever-increasing speed, it is perhaps useful to step back and survey a landscape of global economic growth from a longer-term panorama in order to grasp the real trend and the real unusualness of our current environment. UBS' Art Cashin, while not 800 years old, reflects on such a long-term cycle providing some perspective on our belief that "economic growth be regarded as a continuous process that will persist forever," opining that perhaps, based on the study below (Is US Economic Growth Over?), we "could well be a unique episode in human history rather than a guarantee of endless future advance at the same rate." Of course, that would never fit with the current meme that growth is credit is life, but nevertheless well worth some introspection as we give thanks this week.

Via UBS' Art Cashin:

An Absolutely Fascinating Study – A friend of mine pointed me to an absolutely fascinating study. My friend felt it added credibility to his thesis that civilization and economics are subject to an 800 year cycle. My friend likes to cite lots of markers to prove/justify his thesis. He talks of the Dark Ages, the Age of Discovery, and the Age of Enlightenment as some of those markers. It is an entertaining hypothesis and, some day, if there is enough time, space and mental lubricant available, I may outline his hypothesis (at least as far as I can understand it).

In the meantime, I am grateful that he pointed me to a study by Professor Robert J. Gordon of Northwestern University. The study is published by the Centre for Economic Policy Research. While I don't see any connection or support for an 800 year cycle, the report is chock full of eye-opening historical data. Here's how the author begins to outline his thesis:

The paper makes these basic points:

  1. Since Solow’s seminal work in the 1950s, economic growth has been regarded as a continuous process that will persist forever. But there was virtually no economic growth before 1750, suggesting that the rapid progress made over the past 250 years could well be a unique episode in human history rather than a guarantee of endless future advance at the same rate.
  2. The frontier established by the US for output per capita, and the UK before it, gradually began to grow more rapidly after 1750, reached its fastest growth rate in the middle of the 20th century, and has slowed down since. It is in the process of slowing down further.
  3. A useful organising principle to understand the pace of growth since 1750 is the sequence of three industrial revolutions. The first (IR1) with its main inventions between 1750 and 1830 created steam engines, cotton spinning, and railroads. The second (IR2) was the most important, with its three central inventions of electricity, the internal combustion engine, and running water with indoor plumbing, in the relatively short interval of 1870 to 1900. Both the first two revolutions required about 100 years for their full effects to percolate through the economy. During the two decades 1950-70, the benefits of the IR2 were till transforming the economy, including air conditioning, home appliances, and the interstate highway system. After 1970, productivity growth slowed markedly, most plausibly because the main ideas of IR2 had by and large been implemented by then.
  4. The computer and internet revolution (IR3) began around 1960 and reached its climax in the dot.com era of the late 1990s, but its main impact on productivity has withered away in the past eight years. Many of the inventions that replaced tedious and repetitive clerical labour with computers happened a long time ago, in the 1970s and 1980s. Invention since 2000 has centered on entertainment and communication devices that are smaller, smarter, and more capable, but do not fundamentally change labour productivity or the standard of living in the way that electric light, motor cars, or indoor plumbing changed it.
  5. The paper suggests that it is useful to think of the innovative process as a series of discrete inventions followed by incremental improvements which ultimately tap the full potential of the initial invention. For the first two industrial revolutions, the incremental follow-up process lasted at least 100 years. For the more recent IR3, the follow-up process was much faster. Taking the inventions and their followup improvements together, many of these processes could happen only once. Notable examples are speed of travel, temperature of interior space, and urbanisation itself.

What I found most compelling was the recounting of the labor involved in certain tasks before invention and progress changed or replaced them. Here's a key example:

But the biggest inconvenience was the lack of running water. Every drop of water for laundry, cooking, and indoor chamber pots had to be hauled in by the housewife, and wastewater hauled out. The average North Carolina housewife in 1885 had to walk 148 miles per year while carrying 35 tonnes of water. Coal or wood for open-hearth fires had to be carried in and ashes had to be collected and carried out. There was no more important event that liberated women than the invention of running water and indoor plumbing, which happened in urban America between 1890 and 1930.

And we all know that the automobile produces smog and may contribute to global warming. We should all yearn for those idyllic days before the internal combustion engine – or maybe not.

While the railroad connected the cities, there were horses on every urban street. Within the cities, steam power was not practical, so everything was hauled by horses. The average horse produced 20 to 50 pounds of manure and a gallon of urine daily, applied without restraint to stables and streets. The daily amount of manure worked out to between 5 and 10 tonnes per urban square mile, all requiring disgusting human labour to remove. The low standard of living reflected not just the small amount that people could purchase but also the amount of effort at the workplace and at home where they had to expend to perform ordinary tasks.

Remember some of those things as you give thanks on Thursday.

 

Is US Economic Growth Over

 

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Tue, 11/20/2012 - 10:23 | 2998520 GetZeeGold
GetZeeGold's picture

 

 

Yes.

Tue, 11/20/2012 - 10:35 | 2998553 idea_hamster
idea_hamster's picture

So let me get this straight:

 

1850:  My wife carries water for the family and I sweep the horse shit out of Wall Street.

 

2012:  Obama carries water for Blankfein and I'm expected to eat the bull shit coming out of Wall Street.

 

Yeah, that sounds like a big f'king pile of "progress."

Tue, 11/20/2012 - 10:47 | 2998621 Ass_Hat
Ass_Hat's picture

"The average North Carolina housewife in 1885 had to walk 148 miles per year while carrying 35 tonnes of water."

Could this explain the ubiquitous Obesity we now see in American women?

Tue, 11/20/2012 - 15:42 | 2999603 flattrader
flattrader's picture

No doubt it also accounts for the parallel obesity in men who no longer have to shovel horseshit, but still manage to produce it without the benefit of actual horses.

Tue, 11/20/2012 - 10:37 | 2998577 Snidley Whipsnae
Snidley Whipsnae's picture

Indoor plumbing was reinvented. The Romans had plumbing long ago and heated public and private baths as well.

Of course there was little indoor plumbing during the dark ages.

My grandmothers farm house did not have indoor plumbing until 1959, which was typical for the area.

Tue, 11/20/2012 - 11:07 | 2998677 NoDebt
NoDebt's picture

Good point.  It brings up an important issue the article doesn't address:  sometimes things go BACKWARDS, not just flatten out while waiting for the next technological game-changer.

 

Tue, 11/20/2012 - 11:11 | 2998688 catacl1sm
catacl1sm's picture

Sometimes? How about many times.

Tue, 11/20/2012 - 11:22 | 2998724 idea_hamster
idea_hamster's picture

It's possible that there are more major "dark" periods in human history than we realize simply because they don't get recorded.

No one thought that Troy existed -- when it was found, we realized that there was a major Greek dark age.

The next dark age will be literal as well as figurative, with the loss of wide-spread electrical power.

Tue, 11/20/2012 - 11:55 | 2998824 earleflorida
earleflorida's picture

;-))

Tue, 11/20/2012 - 11:06 | 2998676 Jack Sheet
Jack Sheet's picture

Yes.

Tue, 11/20/2012 - 10:25 | 2998523 Pool Shark
Pool Shark's picture

Answer: Yes.

Tue, 11/20/2012 - 10:25 | 2998528 Spastica Rex
Spastica Rex's picture

O boy, here it comes.

Tue, 11/20/2012 - 10:31 | 2998544 LawsofPhysics
LawsofPhysics's picture

"working papers" or "pushing papers" is what people who don't know how to make or do anything of real value "produce" instead.  Fuck em.

Tue, 11/20/2012 - 10:33 | 2998555 GetZeeGold
GetZeeGold's picture

 

 

Good thing our EBT's are totally free.

Tue, 11/20/2012 - 10:37 | 2998580 Spastica Rex
Spastica Rex's picture

I was just waiting for the chorus of "But you haven't taken into account (x)! If we just do (a), (b), or (c) in conjunction, everything will be fine! Human ingenuity always triumphs!"

I see it has started below.

Tue, 11/20/2012 - 15:58 | 2999662 flattrader
flattrader's picture

So are you farming your 20-something acre organic place today or your 30,000 acre GMO operation?

What did you produce today?

Did you take out the trash for your mom or your wife?

Tue, 11/20/2012 - 10:27 | 2998536 LawsofPhysics
LawsofPhysics's picture

In the traditional eCONomic model, yes, growth is dead for the earth.  Hedge accordingly.

Tue, 11/20/2012 - 11:47 | 2998800 blunderdog
blunderdog's picture

Although I'd agree personally, according to the PhD economists, "growth" just means "increase in total debt outstanding," so we should be able to continue to grow no matter what.

Too bad we don't get to make these judgments.

Tue, 11/20/2012 - 10:28 | 2998537 Buzzworthy
Buzzworthy's picture

Last I checked real growth in the U.S. economy stopped in the 1980s.  All 2008 did was blow the doors off the whole damned charade.

Tue, 11/20/2012 - 10:32 | 2998552 LawsofPhysics
LawsofPhysics's picture

Correct.  Time to see just what the underlying collateral and physical assets are behind all this "growth" and "valuation" really is.

Isn't "mark to fantasy" accounting great?

Tue, 11/20/2012 - 10:41 | 2998586 sessinpo
sessinpo's picture

Up arrow for you.

 

I getting kind of tired of these colleged educated no nothings that are late to the game. Granted, Cashin has opened talked about the financial and economic problems. But having said that, anything still even asking about growth is quite frankly moronic.

 

The real question should be about growth relative to other economies and currencies. In other words, wealth preservation. Yes, the US will experience decline, but in what manner compared to other industrialized nations since many if not most will also experience a decline - you know like a depression!

 

So, when all is said and done, it leads you to capital preservation with at least some, not all, but some in PMs as well as other physical (not paper) commodities. That also includes food, guns and ammo.

Let liberalism fail. God will sort it out.

Tue, 11/20/2012 - 10:42 | 2998597 duo
duo's picture

Financialization skimmed all of the productivity growth of IR3 into the black hole of fraud and debt-based money.

Tue, 11/20/2012 - 10:42 | 2998598 Snidley Whipsnae
Snidley Whipsnae's picture

Excellent observation, Buzzworthy. Although I would push it back a bit further to... say, 1971... and auspicious date indeed considering the US severed the tie between dollar and gold. All 'growth' after 71 is suspecious since the dollar became rubber.

Tue, 11/20/2012 - 11:00 | 2998657 duo
duo's picture

No mention that IR1 and IR2 both happened during the era of "hard money"?

Tue, 11/20/2012 - 10:32 | 2998548 buzzsaw99
buzzsaw99's picture

I feel so much smarter now! [/sarc.]

Tue, 11/20/2012 - 10:35 | 2998558 Quinvarius
Quinvarius's picture

An 800 year cycle indicating the end of growth?  Dude.  STFU.  Just stop.  You were wrong to bet against QE1.  You were wrong to bet against QE2.  You are wrong to bet against QE3.  You are wrong to bet against hyperinflation ever.  Easy money is what moves markets and NOTHING ELSE.

Tue, 11/20/2012 - 10:34 | 2998561 gaoptimize
gaoptimize's picture

I'm as pessimistic as anyone due to the big Government-enabled debt-based growth model we have been following since Nixon closed the gold window.  Prepping etc.  But, Art Cashin should not condemn the future for our current mess.  Strongly recommend he watch Ray Kurzweil's talk at the Singularity Summit 2012: http://fora.tv/conference/the_singularity_summit_2012/ and revel in the explosive growth we will experience once the dead wood, underbrush, and parasites have been burned away in the collapse.  Like Yellowstone after the fires of 1988 or post-eruption Mt. St. Hellens.

Tue, 11/20/2012 - 10:36 | 2998569 fonzannoon
fonzannoon's picture

My buddy preaches that singularity stuff all the time. I don't really understand it. We all morph into robosts or something in the future. I asked him if there would be hot robot chicks and he said there would be, so I am open to it.

Tue, 11/20/2012 - 10:42 | 2998596 GetZeeGold
GetZeeGold's picture

 

 

Art Cashin should not condemn the future for our current mess.

 

Let him....they're going to have to pay for it. The only thing our kids are going to remember about us is that grandma was a greedy asshole.

Tue, 11/20/2012 - 10:50 | 2998630 gaoptimize
gaoptimize's picture

Wrong.  Future generations will not pay for it. Collapse and repudiation in the great re-ballancing is barreling towards us unstoppably.  Did you really think it would be repaid?

Tue, 11/20/2012 - 11:22 | 2998638 GetZeeGold
GetZeeGold's picture

 

 

Collapse - paying everything back all of a sudden.

 

Pay me now or pay me later....but you will pay.

Tue, 11/20/2012 - 10:57 | 2998652 LawsofPhysics
LawsofPhysics's picture

Correct, but forget what anyone "thinks", because the laws of Nature and physics really don't give a shit.  Hey, the good news is that we finally get to find out what the real value of everyone's labor really is.

Fine with me.

Tue, 11/20/2012 - 10:34 | 2998562 Hedgetard55
Hedgetard55's picture

So money supply and debt growth now count as "economic growth"?

Tue, 11/20/2012 - 10:36 | 2998571 bigkansas
bigkansas's picture

Is this where I blame the Joooos?

Tue, 11/20/2012 - 10:37 | 2998575 notadouche
notadouche's picture

"An object at rest tends to stay at rest until acted upon it by an outside force".  "An object in motion tends to stay in motion...."

Perhaps it is over until it's not over unless you subscribe to the notion that "everything worth inventing has already been invented.  I maintain US economic growth may be in for a long rest but I would hardly be so bold to say it is over.  Something mindblowingly and life changing will be invented, probably by Al Gore and his internet and there will begin the new phase.  Of course it may take 20, 30 or even 50 years or it could birth next week.  That's the great and awful thing about the future.  Nobody really knows until after the fact.

Tue, 11/20/2012 - 12:06 | 2998848 Acet
Acet's picture

Nah, I think I what you want here is the Second Law of Thermodynamics, the one about how "The entropy of any isolated system not in thermal equilibrium almost always increases" or in simple terms "stuff tends towards chaos" or even "given enough time, without a constant input of energy/work, everything rots"

The natural tendency of human endeavours is that eventually it all ends up in collapse and is covered by the sands of time. As long as we keep working on it, as long as people have a working spirit, as long as the producers outweight the parasites, we keep going forward, adding more and more structure and complexity to our society. When sloth dominates human thinking, when we care more about the symbols of value than the actual value, when the parasites consume more than the producers can produce, the Laws of Nature reassert themselves and we not only stop progressing, we actually start going back as the physical and social structures crumble and decay, their skelletons picked clean by those generations, made mostly of unproductive parasits, who by virtue of having only known plenty, believed themselves to be entitled to prosperity, even while they indulged in sloth.

I would say that, at least in the Western world, for at least 2 decades we've been on the phase when the riches left over from the ages of prosperity are being consumed to maintain unsustainable sloth and unearned luxury.

Tue, 11/20/2012 - 17:30 | 2999974 notadouche
notadouche's picture

I yield the floor to the expert in thermodynamics

Tue, 11/20/2012 - 10:38 | 2998579 The.Oracle
The.Oracle's picture

Die AAPL die!!!! <3 <3 <3

Tue, 11/20/2012 - 10:42 | 2998583 dwdollar
dwdollar's picture

Technological innovation is stagnating???

I'm sure it has nothing to do with high taxes, over-regulation, bureaucratic bloat, selective enforcement of law, debt saturation, corruption, endless and meaningless wars, dwindling resources, currency debasement and declining birthrates of intelligent people...

No... none of that. Rally on!

Tue, 11/20/2012 - 10:38 | 2998584 IamtheREALmario
IamtheREALmario's picture

Considering that since the US farmed off its manufacturing, really starting in the mid-90s virtually all of the SO CALLED growth has come from underreported inflation and, loose money inflating assets and labor arbitrage it is no surprise that 15 to 20 years later the so called pundits and experts are realizing that the growth paradigm's main drivers population growth and value creation (through labor) are not as certain as they once were.

GROWTH IS NEVER CREATED THROUGH MONETARY INFLATION. It is created through VALUE ADDING labor. Everything else is a sham.

Tue, 11/20/2012 - 10:41 | 2998590 Yen Cross
Yen Cross's picture

Everyone saddle up. Bernanke is speaking at noon time e.s.t., and will probably be wearing a "space suit",while pushing his "out of this world" QE agenda...

Tue, 11/20/2012 - 10:44 | 2998603 fonzannoon
fonzannoon's picture

rabble rabble rabble moderate economic growth yadda yadda yadda continue to provide accomodative monetary policy....blah blah blah not a panacea....

Tue, 11/20/2012 - 10:47 | 2998619 Snidley Whipsnae
Snidley Whipsnae's picture

Bernank is speaking? Explains the attacks on commodities that began about six thirty am... to little effect so far.

Tue, 11/20/2012 - 10:47 | 2998617 Flakmeister
Flakmeister's picture

Well, what do you expect if you pull forward demand through financialization and then fail to increase the oil supply to pay for it all??

Tue, 11/20/2012 - 10:52 | 2998640 Spastica Rex
Spastica Rex's picture

I expect people to get to work INNOVATING.

You say there are no easy answers?! Well, I say, you're not looking hard enough!

Personally, I'm eagerly awaiting the flying car I was promised when I was a kid at Disney Land.

Tue, 11/20/2012 - 15:27 | 2998798 Future Jim
Future Jim's picture

We should have had flying cars by now, but big government is holding back innovation in general - just like it did before 1750.

 

Also, flying cars in the hands of ordinary people are even scarier than assault rifles to so-called "progressives".

Tue, 11/20/2012 - 12:18 | 2998909 Diogenes
Diogenes's picture

Take a look at the specimens driving down the freeway and the vehicles they inhabit. Do you really want them all passing over your house in flying cars?

Tue, 11/20/2012 - 12:51 | 2999072 Future Jim
Future Jim's picture

See what I mean?

Tue, 11/20/2012 - 13:14 | 2999142 Acet
Acet's picture

The flying car is just a small incremental improvement in travel speed at, in all likellyhood, a huge energy cost. Not really something to pull our society forward.

The next big thing will be either cheap and plentifull energy (fusion, most likelly), self-assembling structures (probably through nanotechnology or bioengineering). In the second league would be things like Space mining and such, though the capital investment needed is much bigger (mind you, if 1/2 the military budget of the US was directed to it, we would be mining asteriods already)

 

Tue, 11/20/2012 - 17:34 | 2999989 Shigure
Shigure's picture

Flying cars? Not sure we will have flying planes much longer!

http://blogs.minyanville.com/ernst-labruyere/2012/11/11/why-airplanes-re...

Tue, 11/20/2012 - 10:51 | 2998636 Lewshine
Lewshine's picture

What just happened? Futures were flat to up going into last minute prior to open. Market then opens .50% down?? A slow walk up RATHER than a blow your doors off higher open?? - OR perhaps, the LONG SIDE has far to many retail traders banking on the always inexplicable status quo...Slaughterer?

Tue, 11/20/2012 - 10:58 | 2998654 jayman21
jayman21's picture

Here is my short list of things to watch that will improve productivity at a local level and I am sure I have no idea on timing or what the final outcome will be, but I am keeping an eye on them.  All of them will decentralize and Fuck Bernancke and company.  I am not sure we will head to the dark ages, I think it will be more like a decentralization trend and it will be the dark ages for anyone with a degree in central planning or relying on sucking the tit of centralization.

-3d printing

-Local Power Generation (at home level)

-Robots - no need to outsource, local labor for farming etc.

-Bitcoin, or something like it, there is a lot of room to increase productivity with issueing money

Tue, 11/20/2012 - 11:18 | 2998708 Catullus
Catullus's picture

Thats a pretty solid list.

I'd add torrenting to it, which is a decentralization of knowledge and culture. At some level it's impossible for them to prevent the sharing of ideas with the technology in place.

Tue, 11/20/2012 - 11:45 | 2998794 jayman21
jayman21's picture

This one really got me thinking about 3d printing and how it will decrease inventory and transprotation cost to almost zero.  You still need raw materials.  

http://www.digitaltrends.com/cool-tech/3d-printed-gun-company-gets-machi...

Open source blueprints on torrent allowing people to pay with bitcoins.  That is some real creative destruction.

Tue, 11/20/2012 - 11:56 | 2998825 Future Jim
Future Jim's picture

Individual power generation would make us all be more independent and vote accordingly. Government will never let that happen. It would make a nation far less vlnerable in a war, but government will NEVER let that happen. They let tha Internet thing get out of control, but they won't let it happen again.

Tue, 11/20/2012 - 12:42 | 2999031 jayman21
jayman21's picture

Nice Link. +1

Tue, 11/20/2012 - 10:58 | 2998655 DonutBoy
DonutBoy's picture

No growth before 1750. Right. We were still in caves competing with our Neanderthal cousins.  There was no bronze age, and no iron age.  Our ancestors fashioned steam engines out of clay with finely-edged stones to kick-off IR1.

Tue, 11/20/2012 - 11:01 | 2998664 adr
adr's picture

Growth is over when the population no longer has the skills or the intelligence to produce what they used to consume.

How many people do you know that can actually build an internal combustion engine? How many people do you know that can build a generator? In fact how many people do you know that can actually build anything at all? In every news story and magazine 90% of the future innovators figuring out new ways of thinking are all Indian and Asian.

There is also a big difference in knowing how to fix something and knowing how to build it from scratch. Human knowledge is reverting back to the dark ages where the collective knowledge was concentrated into very few hands. Much of this is do to the idiotic central planned education system creating social worker drones instead of productive individuals.

Much of our technical manufacturing has become automated. If the knowledge of how to program the machines is lost, there might not be anyone left who knows how to produce the product without them. I see it every day. I meet supposed "engineers" that can't figure out basic construction and have no knowledge outside a CAD program.

The future is idiocracy. It has already been written and the evedence is Detroit, Cleveland, and every other ghetto in the nation. In 30 years the population of the worthless will expand to over 70% of the people. If you think these people will band together to create a new golden age of mankind, I'd really like some of what your smoking.

Tue, 11/20/2012 - 11:30 | 2998717 ptoemmes
ptoemmes's picture

Kind of reminds me of an exchange I had with a co-old-codger like myslef a few years ago lamenting that we no longer had (motorcycle) mechanics but rather (motorcyle) technicians.  When the 'puter cannot really tell you want is going on then you need a mechanic and not a tecnician with that deer-in-the-headlights stare.

This also reminds me of the "warnings" from Kunstler, Greer, and others that once growth stops and the standard of living "declines" things will be much more localized and will favor the butcher, the baker, and the candle stick maker (and mechanic, plumber, farmer, etc) - to which I will add armorer/gunsmith.  Not so much the securities trader.  Get thee a useful dirty fingernail skill and become good at it.

I suppose it's possible that one day again it might be valued to have a job shoveling horse shit.

 

 

Tue, 11/20/2012 - 12:02 | 2998836 Future Jim
Future Jim's picture

"Much of this is do to the idiotic central planned education system creating social worker drones instead of productive individuals."

If we replaced our education system with the free market instead of what is for all practical purposes a communist system, then that would be a rennaissance.

Tue, 11/20/2012 - 13:26 | 2999183 epwpixieq-1
epwpixieq-1's picture

Or how many people can build an energy transformer not relying on ANY moving parts (not relying on any type of conventional transformation of energy ), and using the dynamics that are so pervasive in Nature.

Nature does not like complexity and inefficiency, and promptly purge them with passage of time, for any system/engine that is not PLUGGED in "the electrical socket of Nature" will disappear promptly (and quite shortly in the history time frame). The only growth sustainable on longer time line is the Natural growth, and willingly or not humans will be FORCED eventually ( possibly quite soon ) to recouple with the Natural growth, and if we plug our systems to the "wheelwork of Nature" (Tesla), we will manage to save half of the humanity. If not, well after explosive growth, there is explosive degrowth, for at the end, we have to converge to the Natural growth as a mean.

 

Tue, 11/20/2012 - 11:21 | 2998718 Bicycle Repairman
Bicycle Repairman's picture

If 99% of the growth went to the 1%, who gives a shit?

Tue, 11/20/2012 - 11:21 | 2998719 Toolshed
Toolshed's picture

It all boils down to one root issue really. Current economic models are all based on (although none, that I am aware of, actually adress it directly) open ended, as in infinite, expansion potential. The problem is, we live in a finite world. We are rapidly running out of the stuff we need to live while drowning in the crap we find entertaining. There are absolutely, even now, more humans fouling this nice planet than this nice planet can support in a sustained manner. With more on the way! Fortunately, for this nice planet anyway, the upcoming global conflict will reduce the human count substantially. See, there is always a silver lining.

Tue, 11/20/2012 - 11:28 | 2998745 ptoemmes
ptoemmes's picture

I admit ignorance on this, but I have heard the REASON economic models - economies - REQUIRE exponential growth is because of the debt/credit component.

Would there be a need for (excessive) debt/credit in a - I guess call it a sustainable economy?

I realize this is probably not a simple topic and I am probably cofusing/conflating elements.

 

 

Tue, 11/20/2012 - 12:02 | 2998838 blunderdog
blunderdog's picture

Nah, it's simple as pie.

The issue is interest.  Money that is lent requires rent payments back to the lender. 

Thus there *has to be* more money CREATED to enable that debt to be paid back.

Tue, 11/20/2012 - 21:53 | 3000743 Tommy Gunner
Tommy Gunner's picture

No growth.  The good old days when humans were living sustainable lives.

 

Unfortunately there is no going back - because we now have 7 billion people that are a product of cheap energy - cheap energy is done. 

 

Well... we CAN go back but first we will experience a massive culling of humans.

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