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The Real Reason the Economy Is Broken (and Will Stay That Way)

Tyler Durden's picture




 

Submitted by Chris Martenson of Peak Prosperity,

We are far enough and deep enough into the most heroic monetary and fiscal efforts ever undertaken to finally ask, why aren't these measures working?

Or at least we should be.  Oddly, many in DC, on Wall Street, and the Federal Reserve continue to steadfastly refuse to include anything in their approaches and frameworks other than "more of the same."

So we are treated to an endless parade of news items that seek to convince us that a bottom is in and that we've 'turned the corner' often on the flimsy basis that in the past things have always gotten better by now.

The framework we operate from around here is simply encapsulated in the observation that there has never been global economic recovery with oil prices above $100 over barrel.  That is shorthand for the idea that oil is the primary lubricant of economic growth and that it is not just the amount of oil one has to burn but also the quality, or net energy, of the oil that matters. 

If we want to understand why all of the tried-and-true monetary and fiscal efforts have failed, we have to appreciate the headwinds that are offered by both a condition of too-much-debt and expensive energy.  Neither alone can account for the economic malaise that stalks the world.

Getting a Little for a Lot

Trillions have been printed and injected into the world's economies, and yet things seem to be barely limping along, requiring constant attention and interventions from both fiscal and monetary authorities. 

The broadest measure of money in the U.S. is Money of Zero Maturity, or MZM.  Note that it has increased by an astonishing 44% since the start of the crisis:

We could similarly look at the Federal Reserve balance sheet, or excess reserves, or a dozen other indicators that all say the same thing: The money supply has been expanded enormously.

And what do we have to show for it?

Not much.

Since 2005 real that is, inflation-adjusted GDP has only expanded by 0.9% on an annualized basis.  On a nominal basis (not inflation-adjusted), the number is only 2.9%, far below the 5%-6% required to sustain a banking system dependent on exponential growth in that range.

In a very nice piece of work entitled Our Investment Sinkhole Problem, Gail Tverberg put up this handy and extremely important chart:

Oil and GDP are highly correlated and always have been.  The general observation is that growth in GDP is usually higher than growth in oil consumption - as growth in oil consumption powers economic growth.  Without growth in oil consumption, GDP growth doesn't advance.

Back in 2009, in a piece entitled Oil - The Coming Supply Crunch (Part I), I calculated that every 1% increase in global GDP was associated with a 0.25% increase in oil consumption in other words, a roughly 4:1 ratio.

Since 2007, something quite remarkable has happened in the world of oil, and that has been a decline in the consumption of oil in the U.S. and Europe -- with China and India pretty much making up the difference for everything that the West didn't consume.

That, plus a dramatic increase in the price of oil were the only ways to balance out the fact that since 2005 oil production has been essentially dead flat:

If the view that oil consumption and economic growth are linked is correct, then we might easily imagine that simply making money cheaper and more widely available would do little to boost the real economy.

Sure all that funny money will boost asset prices, but in this story, the tail does not and cannot wag the dog.  Stock prices may rise, but unemployment will not budge.  Bonds will become more expensive, but GDP will stall.

Hollowed Out

Now the Fed is finally showing signs of saying hey, what gives? as its policies do little to improve the things it publicly admits to wanting to improve.

In this recent speech by Janet Yellen, Vice Chair of the Fed, you can see her nibbling all around the edges of the mystery:

In the three years after the Great Recession ended, growth in real gross domestic product (GDP) averaged only 2.2 percent per year. In the same span of time following the previous 10 U.S. recessions, real GDP grew, on average, more than twice as fast--at a 4.6 percent annual rate.  So, why has the economy's recovery from the Great Recession been so weak?

 

(...)

 

[T]he unprecedented level and persistence of long-term unemployment in this recovery have prompted some to ask whether a significant share of unemployment since the recession is due to structural problems in labor markets and not simply a cyclical shortfall in aggregate demand. This question is important for anyone committed to the goal of maximum employment, because it implicitly asks whether the best we can hope for, even in a healthy economy, is an unemployment rate significantly higher than what has been achieved in the past.

 

For the Federal Reserve, the answer to this question has important implications for monetary policy. If the current, elevated rate of unemployment is largely cyclical, then the straightforward solution is to take action to raise aggregate demand.

If unemployment is instead substantially structural, some worry that attempts to raise aggregate demand will have little effect on unemployment and serve only to stoke inflation.

(Source)

As I said, the Fed is nibbling, but it is not yet even close to the center of the conundrum.  Yes, there are structural issues at play, but they have as much to do with expensive oil as they do with any great shifts in labor market trends. 

The main part to consider here is contained in the last two bolded parts in the above quote.  If the Fed is just chucking more and more money into an economy that has fundamentally shifted into a lower gear, then all they are doing is laying the tinder for future inflation.

Given the amounts involved, the potential for a very punishing period of inflation is quite high, for reasons often discussed here, such as in the recent article QE For Dummies.

Economic Sinkholes

This leads us back to Gail Tverberg's piece on economic sinkholes.  Her main point in that piece was that in times past, higher investment led to higher output.  That is, spending led to economic growth, especially investment spending.

Carefully buried within higher oil prices are higher prices for every single economic activity that uses them.  Along with diminishing ore yields come incrementally higher costs to simply, extract, and refine those ores, let alone fashion them into something useful.

Gail writes:

All types of mineral extraction, but particularly oil, eventually reach the situation where it takes an increasing amount of investment (money, energy products, and often water) to extract a given amount of resource. This situation arises because companies extract the cheapest to extract resources first, and move on to the more expensive to extract resources later.

 

As consumers, we recognize the situation through rising commodity prices. There is generally a real issue behind the rising prices -- not enough resource available in readily accessible locations -- so we need to dig deeper, or apply more “high tech” solutions. These high tech solutions indirectly require more investment and more energy, as well.

 

While we don’t stop to think about what is happening, the reality is that increasingly less oil (or other product such as natural gas, coal, gold, or copper) is being produced, for the same investment dollar. As long as the price of the product keeps rising sufficiently to cover the higher cost of extraction, the investor is happy, even if the cost of the resource is becoming unbearably high for consumers.

(Source)

The summary here is that it takes more and more to achieve less and less.  The old form of economic growth is no longer with us, but the Fed still doesn't get it.  It still has its eyes firmly trained on economic indicators and equations, having not yet raised its gaze into the real world where limits are being reached.

As Gail nicely encapsulates, many of those limits are carefully hidden from view as a slightly but steadily reducing net energy for oil seeps into every nook and cranny of our complex economy.

The sinkholes that we are facing now are extraordinary.  Some of them are quite literal, and numerous, as Harrisburg, Pennsylvania is demonstrating:

Bottom Falls Out of Debt-Ridden City

Jan 31, 2013

HARRISBURG, Pa.—With midnight approaching on New Year's Eve, Sherri Lewis and her two children knelt to pray for a better year ahead.

 

A few minutes later, she heard a rumbling that sounded like fireworks. The ground outside her apartment had opened up, revealing a municipal disaster that shows how far this city's finances have sunk.

 

A sinkhole, measuring about 50 feet long and eight feet deep, had swallowed Ms. Lewis's street, damaging water and gas pipes and forcing more than a dozen residents to evacuate one of the city's poorest neighborhoods. "I thought the world was ending,'' says Ms. Lewis, 42 years old.

 

Harrisburg officials have identified at least 40 other sinkholes around the 50,000-person city. The combination of particularly sandy soil and leaky pipes under Harrisburg's streets make it susceptible to sinkholes, city officials say. But Harrisburg has a bigger problem: The Pennsylvania capital can't afford to replace many of the aging pipes, some of which date back to the 19th century.

The metaphor perfectly offered by Harrisburg is that once you run out economy, your current infrastructure alone may be well beyond your means to maintain.

The embodied energy in just our existing property, plant, and equipment is enormous.  Nearly every high-tech dream of a kinder, gentler future where 9 billion people somehow enjoy higher average standards of living than the current 7 billion requires an extraordinary investment of energy.

Left out of this dream is a crisp articulation of exactly where that energy will come from and when we will begin to transition to prioritizing its use towards building and maintaining all of that new infrastructure.  It's not enough to merely buy electric cars, should they ever be manufactured in sufficient quantities, because we also need new grid components, electrical storage, generation, and a thousand other components to pull it off.

I note that with every passing year, more and more internal combustion engine (ICE) vehicles are manufactured and sold, not fewer and fewer.  The past 7 years has seen the number of new ICE vehicles sold grow at a compounded rate of 3.7% per annum, and at that rate, 2013 should see more than 80,000,000 sold.  That's up from just over 50,000,000 only ten years ago.

Every one of those represents the investment of energy and capital that will consume our remaining oil at the expense of anything else we might choose to do with that oil, such as maintain our current infrastructure as we build out the next one.

Conclusion

As we dump more and more money into the economy, hoping with all our collective might that it will once again sputter back to life and lift all fortunes and boats, too few are asking what happens if it does not.

If there are other factors at work here besides a simple case of too much debt, then the Fed is not only barking up the wrong tree, but is unaware that a very dangerous animal with a bad attitude is resting up there.

These are truly extraordinary times.  I am in awe of the number of otherwise professional investors who believe that the Fed has things safely in hand.  The amount of market insanity and complete disconnect from reality has me thankful that I already lived through a similar time and can keep things in perspective now.

That time was 2005 to 2007, when I was trading quite actively and thought the world had gone mad.  Nothing made sense, because I was trying make sense of things that could not be made sense of.   In times of extraordinarily abundant liquidity and loose monetary policies, all that has to be understood is that financial assets tend to run up in price during such moments.

The fact that this all ended quite badly then does little to make me think this time is going to end any better.  Thin-air money, attempting to print one's way to prosperity, and spending more than you have are proven losers in the history books.

Yet here we are, doubling down we're all in and I guess there's no turning back now.  The Fed is going to keep with the program until forced to change by circumstances.

As I see it, the economy is broken and it will stay that way.  Our only hope for an alternative would be to immediately cut our losses in those enterprises that do not make sense in a world of increasingly expensive liquid fuels, and invest heavily in those things that will help us transition to a future without fossil fuels.

I am quite aware that many decades’ worth of fossil fuels remain, but equally aware that all energy transitions require four to six decades under ideal conditions where one is transitioning to a higher quality fuel source and capital is expanding. 

And under less-than-ideal conditions, where we are transitioning to a lower density energy source (as all alternative energy sources are) and capital is shrinking?  There we might imagine it could take longer than usual; a 100-year transition period is not out of the question.

In the meantime, the best I can tell you is that the markets are reflecting liquidity, not reality, and that until and unless the world suddenly starts to produce a lot more crude oil and the U.S. and Europe increase their consumption of it, I will remain quite skeptical of all pronouncements of recovery in the West.

 

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Wed, 02/13/2013 - 16:37 | 3241055 AnAnonymous
AnAnonymous's picture

'American' militaries are middle class institutions.

Wed, 02/13/2013 - 16:41 | 3241074 TheFourthStooge-ing
TheFourthStooge-ing's picture

Chinese citizenism propaganda mills are low class institutions.

Wed, 02/13/2013 - 22:45 | 3241917 Seer
Seer's picture

OK, I'll grant you your wish of gasoline below $2.50/gal, but the tradeoff will be your JOB!

We got to where we are now because of cheap energy (and credit).

Go ahead an rule out "speculation," but then ask yourself who is going to be in charge of correctly identifying actual demands?  Yeah, I get it that markets can be taken to the cleaners; however, eventually this cannot hold and there WILL be an opposing force to force a rebalancing (if something can in fact be rebalanced- if it's in terminal decline, then what?).

Wed, 02/13/2013 - 15:04 | 3240768 chancee
chancee's picture

What if you built a fake stock market and no one came?

Wed, 02/13/2013 - 22:50 | 3241932 Seer
Seer's picture

Are you referring to Fed meetings?

Wed, 02/13/2013 - 15:05 | 3240774 waterwitch
waterwitch's picture

Print MOAR OIL!

Wed, 02/13/2013 - 15:09 | 3240789 7AM Watcher
7AM Watcher's picture

In a finite world of limited resources, perpetual growth is a lie.  Money is UNLIMTED but food and energy are not.  The herd will be thinned and only the strong, prepared and the thinkers will weather the storm.  Ask yourself, what skill do I possess that another person will protect me to provide?

Wed, 02/13/2013 - 15:19 | 3240810 RSBriggs
RSBriggs's picture

If you're a young female, the word "skill" in that last sentence doesn't apply so very much....

Wed, 02/13/2013 - 16:11 | 3240985 Shizzmoney
Shizzmoney's picture

Or if you are Becky Quick

Wed, 02/13/2013 - 15:31 | 3240856 AnAnonymous
AnAnonymous's picture

Not the herd, the master class.

It is a common 'american' fantasy that an overconsumption trouble can be tacked by eliminated low or no consumers.

It is also well known that 'americans', especially middle classers, perceive themselves as the productive class, that is one class that produces more than it consumes.

Welcome to an 'american' world, you'll see, it is a cosy place to be.

Wed, 02/13/2013 - 15:43 | 3240887 7AM Watcher
7AM Watcher's picture

I agree completely with one exception.  The master class will only be dealt with if the common man can recognize them as oppressive and not look up to them to provide a "solution"

I do agree that the US is liken to Disneyland.  Controlled and painted.

I expect that with the race to the bottom of currency devaluation, History tells us that currency wars lead to trade wars and price controls.  Which lead to hot wars.  I expect that the day will arrive in which the world will turn against the petrodollar and then the invaders will arrive to extract a pound of flesh for our sins.

Wed, 02/13/2013 - 15:18 | 3240812 davidsmith
davidsmith's picture

We are far enough and deep enough into the most heroic monetary and fiscal efforts ever undertaken to finally ask, why aren't these measures working?

 

This question is idiotic: these measures are working.  They are corporatist, fascist looting, and they are accomplishing that goal very well.  Next question?

Wed, 02/13/2013 - 17:30 | 3241199 smacker
smacker's picture

You're both right.

Chris's article assesses success against the stated objectives. You are assessing success against the hidden agenda.

Wed, 02/13/2013 - 22:54 | 3241943 Seer
Seer's picture

It's the ONLY game they know to play.  Oh, and by the way, it's the game we're ALL participating in (to one degree or another).

BUT... when "they" have it "all," then what?  The game ends; the very game that has held them aloft.  They can only hope to infuse us with more division between ourselves in the hope that they we can reduce our numbers, and thus the threat to them, ourselves: this is why the likes of Freddie and Trav are so valuable to them.

Wed, 02/13/2013 - 15:19 | 3240817 davidsmith
davidsmith's picture

This is the probem with SO much ZH commentary: it's sophomoric writers set up straw men--ideas that have no basis whatsoever in reality--and then proceed to knock them down.  Good fun, eh?  Except that it's a dreamworld of phantom victories over phantoms.  Which is why NOTHING ZH has EVER published has had ANY effect on ANY policy.  This site is a Disney cartoon.

Wed, 02/13/2013 - 15:33 | 3240858 AnAnonymous
AnAnonymous's picture

It is an 'american' site for 'americans'. And 'americans' enjoy wallowing in fantasy.

Wed, 02/13/2013 - 16:51 | 3241100 sessinpo
sessinpo's picture

So why are you here?

 

I get bashed by liberals all the time for my  free market, modern day libertarian/conservative views. Yet I still post, using logical statements, poising questions to those that have opposite views for intellectual debate. Usually, I get responded to by personal attacks and insults, nothing of substance.

 

But I do it to express a view point and to hopefully educate others. Why are you here, Disney cartoon or not?

Wed, 02/13/2013 - 17:06 | 3241130 Radical Marijuana
Radical Marijuana's picture

Not so, davidsmith!

Zero Hedge is more realistic, by far, than the mass media, which DO present Disney cartoon "news." The mass media are a trillion dollar industry, promoting the frauds that make the fraudulent more wealthy and powerful. Zero Hegde is stuck inside of that system, forced to rely on the emerging popularity of slightly more truth in order to gain readers, that will then earn some automated advertizing revenue, to pay for itself.

Zero Hedge can not possibly get outside of the deep, deep, deep vicious rut already dug by more than a Century of runaway triumph of financial frauds, enabling those doing that to buy up control of the mass media. Zero Hedge can not possibly overcome the basic, already accomplished, social facts that our elections are puppet shows, put on by a trillion dollar mass media industry, starring political puppets spending billions of dollars to participate in those shows.

How the hell is Zero Hedge, with nothing more than slightly higher quality information, supposed to compete with trillion dollar amplified lies?

The real world system has become directed by a group of trillionaire mass murderers, but which has gone out of their control. I like Zero Hedge for providing some slightly more penetrating news analysis of that situation, and for allowing unmoderated comments by those who appreciate that.

The idea that it is somehow Zero Hedge's "fault" for failing to change the runaway social insanities of Neolithic civilization is a much more "sophomoric comment" than what is usually presented in the actual acticles featured here.

Wed, 02/13/2013 - 15:34 | 3240865 AnAnonymous
AnAnonymous's picture

After pushing as much people as they could out of their consumption to derive that consumption to themselves.
After stealing that much from rich people.

The 'american' middle class has no other chance than pushing under the train some of the 'american' middle class.

It is only at this price growth of the remaining middle class can be achieved.

Wed, 02/13/2013 - 22:59 | 3241952 Seer
Seer's picture

"The 'american' middle class has no other chance than pushing under the train some of the 'american' middle class.

It is only at this price growth of the remaining middle class can be achieved."

So, let me get your "logic" here, you're saying that the only way growth of the middle class can be achieved is to decrease its numbers?

What what happens when all those Chinese workers who got sucked into the factories making junk end up losing those shitty factory jobs.  Let's see how China's "middle class" handles That! (I'd hope that most figure that their only real salvation lies in rural farming, as it has for generations- did they leave because they wanted to, or because they were forced [by that stellar govt of theirs]?)

Thu, 02/14/2013 - 09:46 | 3242751 tip e. canoe
tip e. canoe's picture

check what the 'poor' people in china did on the Loess Plateau:

https://www.youtube.com/watch?v=sK8JNXHcBMA

Wed, 02/13/2013 - 16:06 | 3240965 Shizzmoney
Shizzmoney's picture

Surprise! The recoveries, over time, have been geting worse:

http://www.washingtonpost.com/business/economy/growth-isnt-enough-to-hel...

At the height of those recoveries, every one percentage point of economic growth typically spurred about 0.6 percentage points of job growth, when compared to the start of the recovery. You could call that number the “job intensity” of growth.

The pattern began to break down in the 1992 recovery, which began under President George H. W. Bush. It took about three years — instead of one — for job creation to ramp up, even when the economy was growing. Even then, the “job intensity” of that recovery barely topped 0.4 percent, or about two-thirds of normal.

The next two recoveries were even worse. Three-and-a-half years into the recovery that began in 2001 under President George W. Bush, job intensity was stuck under 0.2 percent. The Obama recovery is now up to an intensity of 0.3 percent, or about half the historical average.

Middle-class income growth looks even worse for those recoveries. From 1992 to 1994, and again from 2002 to 2004, real median household incomes fell — even though the economy grew more than 6 percent, after adjusting for inflation, in both cases. From 2009 to 2011 the economy grew more than 4 percent, but real median incomes grew by 0.5 percent.

Just keep in mind the one entity that has been in charge of the monetary policy the entire time this is happening: The Federal Reserve.

Economists are still trying to sort out what broke those historical links between growth and jobs/incomes

I'm still trying to "sort out" how economists are still being listened to, and getting paid!

Wed, 02/13/2013 - 16:41 | 3241071 AnAnonymous
AnAnonymous's picture

Middle-class income growth looks even worse for those recoveries.
________________________

Alas, alas, triple alas, the servants to the 'american' middle class have figured out no other way to save the 'american' middle class than to sacrifice part of it.

During the transition, as some no longer middle classers keep being counted as still being middle classers for the sake of it, well, that is the expected.

Remember though, as these sacrificed middle classers are heading to lower class or down, they could have as well be counted as lower class, showing a growth in wages for the lower class...

Wed, 02/13/2013 - 16:48 | 3241091 sessinpo
sessinpo's picture

False conclusion based on a false premise.

 

Article: "Economic Sinkholes", "The summary here is that it takes more and more to achieve less and less."

That is solved under free market principles in the private sector. If the cost efficiency overwhelms the profit potential, then the private sector moves to another area more profitable, that is more efficient. That might be to anothe sector, such as from oil to gas (yes I know that you usually get both during extraction), or it might mean moving to other physical areas of the world where those reserves are.

 

Article: "Conclusion", "As we dump more and more money into the economy, hoping with all our collective might that it will once again sputter back to life and lift all fortunes and boats, too few are asking what happens if it does not."

 

And this explains why this author and many don't get it. In one sentence he exposes the fallacy.

Why are we dumping more money into the economy, with all our collective (socialism) might that it will once again sputter back to life and lift all fortunes and boats?

Well you wouldn't have such massive dumping of money under modern day libertarian, conservative capitalist views. It is modern day liberalist/progressive/socialist/communist ideology that is dumping, throwing away money inefficiently into markets they wish to control.

Another article that address and points out symptoms but totally neglects and misses the problem.

Wed, 02/13/2013 - 23:04 | 3241965 Seer
Seer's picture

What world are you living in?  Do you not get it that the existing infrastructure cannot be maintained, let alone expanded?

You want to see red.  Go ahead and you'll be dead.  Those that understand the REAL world (physical, and that this has very little to do with the political one) will continue on.

Those that froth about "socialism" need to explain what Amish and Quaker (etc) communities are if not "socialist."

Wed, 02/13/2013 - 18:07 | 3241320 robertsgt40
robertsgt40's picture

Keep in mind "Peak Oil" is a myth.  There's more oil on the north slope in Alaska than is in the ME.  Sadly, a lot of it is controlled by BP.  A lot of it goes to China.

Wed, 02/13/2013 - 23:09 | 3241976 Seer
Seer's picture

A lot more than WHAT?

Perpetual growth on a finite planet is a myth.  The ONLY way that one could believe in it would require that the earth be flat.

Give us some numbers to back up your claim.  And, please include forecasted rates of increased draw-downs.

"A lot of it goes to China."

Maybe (assuming that you're right about this; but, most oil tends to be distributed closest to its extraction and processing locations- that's the eficiency of the market) China actually HAS money to pay for it?  Or, are you proposing some sort of nationalization? (and if so, how to you reconcile this with any instances in which you might have spoken ill about other countries being protective of their reserves?)

Wed, 02/13/2013 - 19:37 | 3241503 sschu
sschu's picture

Part of the reason the price of oil remains so high is the massive amount of printing (currency dilution) that is going on.  This is the great equalizer and the benchmark (gold is too small of a market and too easily manipulated to be meaningful) for the value of money.  If you own oil, you would be a fool to take these paper promises.

Make no mistake, the big money guys are likewise trying to suppress the price of oil as the also see the relationship Chris M suggests.  They have had some success, but not enough. 

This is nothing new, the topic of the GDP-killing price of oil has been talked about for years on this site.  Bennie etal thought they were bigger than those pesky laws of economics and could get around this problem.  So they bailed out their banker buddies, keep the Bamster and Congress from having to confront reality and now here we are.

Here is the thing, the problem is not going away, withdrawing the free money crack will be very painful, the ACA is about to turn the employment market upside down and we have borrowed trillions since the crash.

The opportunity to fix this thing in a reasonable manner was gone long ago.  Now is the time to pay the piper.

sschu

Wed, 02/13/2013 - 20:25 | 3241582 blindman
blindman's picture

the reason the economy is broken is because the monetary system
is a fraud based usury slave system on the life support of exponentially
increasing criminal fraud that has been embraced by those
who benefit from the fraud and make sure it is never prosecuted
as they make a good living at it.
problem is the infrastructure was grown and developed presuming
there would be no end to the capacity of the individual, common,
to absorb the blow in perpetuity, turns out there are limits.

Wed, 02/13/2013 - 20:31 | 3241593 blindman
blindman's picture

have i said that we live in the heart of a financial crime
scene? if not here i say it. and that is the problem with
the "economy". it is not an "economy", it is a bordello and
a pimped out shit show of financial insanity and hooliganism!

Wed, 02/13/2013 - 20:52 | 3241620 blindman
blindman's picture

if the economy was a painting the fed would be the supplier
or merchant offering paint. all they offer is shite and then
the painters wonder...at the end of the day why do all my
paintings look like shit? did i miss a step?

Wed, 02/13/2013 - 21:32 | 3241704 SKY85hawk
SKY85hawk's picture

Chris blames misguided energy consumption and infrastructure investment as the source of the world’s problems.  Not one word of Bank’s investment failures, ie. Mortgage  fraud & Investment stupidity.

Seems that he never heard of Harry Dent.  It WILL take more time before TPTB acknowledge what they already know. 

How many of you were adults in 1966 to m1981? 

Remember stagflation and the large numbers of people were retiring AND spending less!

I hope you can connect the dots from here. 

If not read this,  http://www.youtube.com/watch?v=PQnkRWfkB8s

 

 

Thu, 02/14/2013 - 00:01 | 3242085 Seer
Seer's picture

"Chris blames misguided energy consumption and infrastructure investment as the source of the world’s problems.  Not one word of Bank’s investment failures, ie. Mortgage  fraud & Investment stupidity.

What, are you wanting yet another "hang the bankers" cheerleader?

Sorry, but Chis is not dwelling on the obvious distraction because it is no more than a DISTRACTION!  He is trying to, and clearly a LOT of people have very thick skulls, get the point across that GROWTH is totally dependent on ENERGY.  The financial system is a layer (parasite?) on a bigger platform that assumes perpetual growth (think "interest" and how long this concept has been around), a platform that necessitates the impossible- infinite amounts of readily available energy (remember: ENERGY = THE ABILITY TO DO WORK; the Egyptians would have loved to have had modern diesel power to construct their pyramids rather than have to deal with massive amounts of human hours (slaves?)!

Thu, 02/14/2013 - 13:08 | 3243423 SKY85hawk
SKY85hawk's picture

Yes I think people that commit fraud and violate federal banking laws s/b prosecuted!

I wish you had read farther to the Demographic stuff. 

When a large number of people reduce their spending and save for retirement the economy will slow down.

 

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