Are You Crazy To Continue Believing In Collapse?

Tyler Durden's picture

Submitted by James H Kunstler via Peak Prosperity,

It’s nerve-wracking to live in the historical moment of an epic turning point, especially when the great groaning garbage barge of late industrial civilization doesn’t turn quickly where you know it must, and you are left feeling naked and ashamed with your dark worldview, your careful preparations for a difficult future, and your scornful or tittering relatives reminding you each day what a ninny you are to worry about the tendings of events.

Persevere. There are worse things in this life than not being right exactly on schedule.

Two simple words explain why more robust signs of an economic collapse have hung fire since the tremors of 2008: inertia and fraud.

Never in human history has there been such a matrix of complex systems so vast, dense, weighty, and powerful for running everyday life (nor a larger population engaged in it). That much stuff in motion takes a while to slow down. The embodied energy has kept enough of it running to give the appearance of continuity. For instance, agri-biz still sends its amber waves of grain and tankers of corn-syrup to the Pepsico snack-food factories, and the WalMart trucks still faithfully convey the pallets of Cheetos, Fritos, Funyons, and Tostitos from the Pepsico loading dock to the big box aisles of glory. The freeways still hum with traffic even though oil is pricey at $100 a barrel. The lights stay on. The gabble and blabber of Cable TV continues remorselessly in the background of life. All of that is due to inertia. It gives the superficial impression of the old normal carrying on. Things go on until they can’t, in the immortal words of Herb Stein

The fraud is present in the abuse and misrepresentation of official statistics used as metrics in government policy, in the pervasive accounting chicanery of that same government in its fiscal dealings, as well as in our leading financial institutions and corporations, including control fraud in banking, interest rate rigging, mortgage and title fraud, front-running, naked shorting, re-hypothecation, money laundering, pumping-and-dumping, channel stuffing, the endless innovation of swindles, and, most importantly, the fundamental mispricing of the cost of money, which reverberates through everything else, most particularly real estate, stocks, and bonds. Beyond that, in the shadows of the shadowland known as shadow banking, a liminal realm of secrets and intrigues, only a few are privileged to know what is going on, and you can be sure they only know their end of the trade — while immense sums of ever more abstract “money” slosh through the derivative sewers on their way to oblivion in the ocean of failed trust.

So, don’t feel bad if this colossal armature of folly still stands, and have faith that the blinding light of God’s judgment will eventually shine even unto the watery depths where failed trust has sunk. Sooner or later the relationship between reality and truth re-sets to the calculus of what is actually happening.

Meanwhile, the big questions worth reflecting upon are: What is the shape of the future? How might we conduct ourselves in it and on our way to it; and how will we think and feel about all that? It’s very likely that the journey to where we’re going will be rougher than the actual destination, once we get there. There is a hearty consensus outside the mainstream financial media and the thickets of academia that the models we have been using to understand the economy look more broken each month, and this surely adds to the difficulty of constructing our own mental models for how the everyday world of the years ahead will operate.

Some of the commentators in blogville and elsewhere like to blame capitalism. Capitalism is a phantom adversary. It isn’t an economic system. It isn’t an ideology, really, or a belief system. If the word means anything, it describes the behavior of accumulated surplus wealth in concert with the known laws of physics — the movement of energy through time and space — and the choices we make organizing society in relation to that.  The energy is embodied as capital, represented in money for convenience. Interest expresses the cost of money over time and the risks associated with lending it. By the way, interest rates work the same way under all political systems, despite attempts in some societies to criminalize it.

During the high tide of the industrial expansion, when fossil fuels were cheap and we accumulated the greatest wealth surplus ever in history, humanity made some very bad choices, squandering this possibly one-time bonanza. We fought two world wars, and lots of wasteful lesser ones. Russia and its imitators attempted to collectivize wealth under gangster government and only succeeded in impoverishing everyone but the gangsters. America built suburbia and Las Vegas. The one thing that no “modern” culture did was plan for a future when the fossil fuel orgy and the techno-industrial fiesta might wind down, which is exactly the case now. Instead, we opted for the Julian Simon folly of crossing our fingers and hoping that some unnamed band of genius wizard innovators would mitigate the problems of resource scarcity and population overshoot just in time.

The demonizers of capitalism propose to remedy our compound predicament by just getting rid of money. But the idea of a human society without money leaves you either up a baobab tree on the paleolithic savannah, or in some sort of Ray Kurzweil techno-narcissistic masturbation fantasy multiverse with no relation to the organic doings on planet earth. I suspect as long as there are human societies there will be things to exchange that have a quality we call “money,” and as long as that’s the case, some individuals will have more of it than others, and they will lend some of their surplus to others on terms. What most people call capitalism was a model of economy derived from a particular transitory moment in history. It seemed to describe reality, but after a while it didn’t because reality changed and it was, finally, just a model. Nothing lasts forever. Boo-hoo, Karl Marx, J.M Keynes, and Paul Krugman.

What’s cracking up first is the complexity and abstraction of our current money operations, sometimes loosely called the financialized economy. If we blame anything for our problems with money, blame our half-baked attempts to mitigate the wind-down of the techno-industrial cavalcade of progress by issuing ersatz surplus wealth in the form of debt — that is, promises to fork over hypothetical not- yet-accumulated wealth at some future date. There are too many promises now, and too few trustworthy promisors, and poor prospects for generating the volumes of wealth as we did in the recent past.

The hidden (or ignored) truth of this quandary expresses itself inevitably in the degenerate culture of the day, the freak show of pornified criminal avarice that the USA has become. It only shows how demoralizing our recent history has been that the collective national attention is focused on such vulgar stupidities as twerking, or the Kanye-Kardashian porno romance, the doings of the Duck Dynasty, and the partying wolves of Wall Street. By slow increments since about the time John F. Kennedy was shot in the head, we’ve become a land where anything goes and nothing matters. The political blame for that can be distributed equally between Boomer progressives (e.g., inventors of political correctness) and the knuckle-dragging “free-market” conservatives (e.g., money is free speech). The catch is, some things do matter, for instance whether the human race can continue to be civilized in some fashion when the techno-industrial orgy draws to a close.

In Part 2: How Life Will Change, we sort out the new operating principles that will matter more in the future than the trash heap of current cultural norms. The society that emerges from the post-growth economy will surely require a new moral compass, a set of values based on qualities of behavior and things worth caring about — as opposed to coolness, snobbery, menace, or power, the current lodestars of human aspiration. 

Click here to access Part 2 of this report (free executive summary; enrollment required for full access).


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Kirk2NCC1701's picture

I'll collapse if I don't stop believing.

Mr Pink's picture

Prolly....I should have just went 100% in on the S&P like everyone else who keeps laughing in my silver stacking face

fonestar's picture

Is fonestar crazy to continue believing in the return of the cyberchrist?  That Satoshi will forgive us our fiat sins and lead us to bitsalvation?

NoDebt's picture

You better watch your back, Fone.  They're not just "suiciding" bankers any more.  This just in (though apparently a few days old):

Autumn Radtke, the 28-year-old CEO of an upstart bitcoin exchange, died last week under mysterious circumstances at her home in Singapore.

The U.S.-born head of First Meta was found dead by police on Feb. 28, with the cause of death yet to be determined.

fonestar's picture

Well they better suicide the whole planet.  Satoshi let the genie out of the bottle.

Occident Mortal's picture

Then hackers kidnapped said Genie.

fonestar's picture

Bitcoin is of the hackers, by the hackers and for the hackers.

SAT 800's picture

Thank you. That makes my basic point precisely. it's another computer game for bit-bangers to go nuts over.

fonestar's picture

And the rise of a new economic class of hackers.  The rebellions of the 60's and 70's failed because they were economically naive.  This is not so with todays hackers and pirate parties.

Boris Alatovkrap's picture

You are refer to Prague and Budapest...? No, Soviet Revolution is wildly successful in 1960s!

MontgomeryScott's picture


That guy 'fonestar' is quite deluded, you know. He has classic signs of a disorder in which there is only one means of trade (which happens to rely solely on an electronic means, and the free flow of the Internet (as well as electricity), and his only angle is the worship of some weird Jim Jones type of character, who he seems to think is a 'saviour'. A deluded punk who was weaned on video games, and never knew that people survived without 'modern conveniences' like cars, electricity, or the Cotton Gin, this one is beneath consideration as an advisor. Either THAT, or he simply wants to sucker more people in to his 'scheme'...


SO, I will now respond to the actual ARTICLE: Are You Crazy To Continue Believing In Collapse?

I answer this question as 'NO'.

Here are a couple of links from the current situation on Earth. As we all know, Kerry wants to impose 'sanctions' on Russia, and Russia has responded that it will dump all it's U.S. investment holdings if this were to take place. GAZPROM (Putin's master) has suspended gas discounts to Ukraine, and demanded full payment (which they do not have). It has ALSO warned of possible 'supply interruptions' of natural gas deliveries to Europe. CHINA has decided to ally with RUSSIA, by the way, and if the economic war heats up, the U.S. DOLLAR is FINISHED (the other nations holding it will try to be the first ones out as the mad scramble to dump the USD accelerates in nano-seconds of robo-trading time). Oh, FUCK, it's gonna get REALLY BAD from this point (should the Oligarchical Masters pull out the stops, and let this Titanic slide down the ways).

A couple of quick links to this (but NOT enough, I state):

Frankly, 'fonestar' is a deluded little tweak, who has been entertaining as he cleans the crap out of his diapers when he soils himself.

SHOW ME on a MAP where the mythical 'Mt. Gox' is, would you?

Is in Russian Homeland, Yes, Boris?

UselessEater's picture

engineered rebellions of the 60s and 70s financed by rockefeller's et al... didn't fail, they delivered the Tavistock goal of shifting national culture in their desired direction

TheRedScourge's picture

Yeah, you're probably right, also this whole Internet thing is totally just another fad that will pass in time too. I mean who even understands how it works anyway?

FEDbuster's picture

and blew up Mt. Gox like Mt Saint Helens!

fonestar's picture

No MtGox blew itself up.  Oh, and nobody cares.

philipat's picture

So what happened to the missing Bitcoins? I thought that the Blockchain was supposed to prevent fraud?

fonestar's picture

No, the blockchain does not prevent "fraud" it just is a working, evolving public ledger. 

Holleyman's picture

How big will the blockchain get?  What is it at now?

What about 15 years from now?

fonestar's picture

It is currently around 16GB.  Not a problem.  Will not be a problem in 15 years either.

Holleyman's picture

I feel the block chain is the weak link, say for example that Bitcoin takes off and 50,000,000 people use it for daily transactions, buy food, gas, clothes, pay bills... etc.  If the block chain is currently at 15 GB for relatively few transactions, what does it look like after millions per hour?

Legit question, not mocking.

fonestar's picture

Not too concerned about it.  Faster wan technologies are always coming out that can handle more throughput.  And the Bitcoin protocol itself being modular by design can adapt too.

philipat's picture

But if the blockchain is so efficient, why can't missing Bitcoins be located and at least be made nul and void?

fonestar's picture

Why would you make them null and void?  That would attack the very fungibility of Bitcoin.  A stolen Bitcoin must be as good as any other Bitcoin.

Boris Alatovkrap's picture

You are naive treat VIRTUAL token as IMMUTABLE in value.

philipat's picture

So, holding Bitcoin I can be ripped-off at any time with absolutely no recourse? What sort of Ledger system is that? Excuse me but perhaps that explains why a lot of folks are sceptical of holding Bitcoin and trust it even less than Fiat currency? I'm not sure that I would trust a Central Banker much more than a Hacker, but it's a close call.

I would seriously suggest that this aspect is something that needs to be addressed before Bitcoin can go mainstream.

Boris Alatovkrap's picture

Ledger? There is no "ledger" in BitCoin... It is exchange medium of choice for dealer of contraband, who is need ledger?

MontgomeryScott's picture

He said that the 'ledger' is 16 GB. Sixteen Gigabytes.

I'm at home with an antiquated personal computer which has a FOUR GIGABYTE capacity.

He's stating that there are FOUR old P.C.s that hold the ENTIRE BITCOIN COLLECTIVE.

HELL, what does an Apple I-pod do? I don't own one, but what kind of storage capacity could it be modified to have? What if someone steals the I-POD LEDGER PHONE?

I mean, SERIOUSLY, with a couple of tweaks, I could get the ENTIRE BITCOIN LEDGER in to my LAPTOP, for Christ's sake!

philipat's picture

I was quoting foneystar who said:

"No, the blockchain does not prevent "fraud" it just is a working, evolving public ledger." 

Which I dispute if it can't identify and eliminate stollen Bitcoin.

MontgomeryScott's picture

Ah, 'Fonestar'.

His name was...

(DAMN, I cant remember that name. can anyone else help fill in the blanks here?)

StychoKiller's picture

Bitcoin transactions (entries in the "ledger") are irreversible by design!

TheReplacement's picture

No offense but that was humorous.

One fundamental flaw that involves the size:  The blockchain must be transmitted and stored.  It would grow exponetially if adopted.  Every bit transmitted or stored represents a unit of energy, every second of every day.  This makes bitcoin inherintly inefficient.  There is a cost to the very existence of it.  It is sort of like interest on a loan that way except you will pay even though you own it.  Every transaction will account for this cost.  That cost will rise and fall according to energy prices, even if hard to perceive.  The more energy costs the less mileage you get out of bitcoin.  Suppose it adds the equivalent of a penny to every dollar (1%) to both sides of every transaction.  Yeah that's a high percentage (one should hope) but you get the picture.

Now take something like a dollar or a euro.  Even if nobody will sell you anything you can make use of them.  You can use as TP.  You can burn for heat.  You can stuff them in the walls as insulation.  Perhaps confetti at parades.  These are physical items and have uses beyond a medium of exchange and they have no absolute ongoing cost to have or use.

Gold and silver may be more valuable in the end but they are not as useful as paper (try wiping with a silver bar before you down vote).  Hedge accordingly.


FEDbuster's picture

Maybe some of the people storing their bitcoins there care?

fonestar's picture

Sucks to be them.  Thanks for playing though.

Boris Alatovkrap's picture

So, please to remind Boris why BitCoin is so fantastic when most largest mainstream exchange facilitator is one by one default on account ("Hot Storage").

MontgomeryScott's picture


When cold, harsh Siberian winter comes, and water freezes when wife throws out remains of dinner in to yard, is good to find young honey who has 'hot storage' for sausages. Matters not when wife bitches (she is old, and fat, and mamushka). Boris learn to like new storage facilitator (that is, until thaw, and wife and young honey take trip to Mediterranian together to find larger sausages, using money from Boris).

Boris Alatovkrap's picture

Boris is apologies, but cannot to understand substance of your commenting. Google Translate is fare not so well translate of hyperbolic innuendo.

fonestar's picture

Stop junking fonestar's comments or he will be contacting the AVHDL.

BlackChicken's picture

Not junking. You asked a question, I gave an answer.

When you start talking about a cyber-christ, I think you're bat shit crazy.

However it would be logical for you to contact them.

philipat's picture

"Click here to access Part 2 of this report (free executive summary; enrollment required for full access)."

 Kind of proves the point?

RafterManFMJ's picture

Yup, why pay to be depressed?

Grosvenor Pkwy's picture

"enrollment required for full access"

When society collapses, gasoline costs $250 per gallon, and we are living on rice and beans, what happens to my paid subscription?

USA USA's picture

Anyone else think fonestar is "Really Cool" under it all?

fonestar's picture

fonestar used to be like yourselves.  Drinking beer, hunting, fishing, riding dirt bikes and listening to Led Zeppelin.  Then he started hanging out with those cryptoanarchist kids.  The rest as they say, is history...

The Gooch's picture

So you now listen to "emo"?


NemoDeNovo's picture

Wearing his "Skinny Jeans" with his beard implants, being a True Hipster, that is ZH's PhonyStar! 

TheMerryPrankster's picture

Fonestar is ratsenof spelled backwards.

You never see Fonestart and Milliondollarbonus in the same room at the same time.

The same person? you decide....


fonestar's picture

What are you talking about?  We've both posted on several of the same threads for over two years.

MontgomeryScott's picture

Just so everyone understands how 'fonestar' regards himself, in relationship to everyone else on this particular tangentical blogposting sphere (The 'ZeroHedge' comment boards):

fonestar used to be like yourselves.
Then he started hanging out...
The rest as they say, is history...

'Fonestar' is Colonel Steve Austin, astronaut. He is NOT like YOU, you rabble. He is BETTER, FASTER, STONGER...

'FONESTAR' IS 'The Six-million Dollar Man':

HE is ABOVE you so-called 'rabble, because HE 'used to be like yourselves', but is NOT this way, because HE is BETTER, STRONGER, FASTER...and HIS is the 'SUPERIOR MIND'...

His pattern indicates 'two-dimensional thinking'.