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Chris Martenson Lecture On Why The Next 20 Years Will Be Marked By The Collapse Of The Exponential Function

Tyler Durden's picture


In this video courtesy of GoldMoney, 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.


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Tue, 11/29/2011 - 23:14 | 1928433 kito
kito's picture

will it take 20 years for the collapse to play out? thats more like a slow roast...........

Tue, 11/29/2011 - 23:18 | 1928448 Triggernometry
Triggernometry's picture

Exponential Decay??

Tue, 11/29/2011 - 23:31 | 1928465 Unprepared
Unprepared's picture

Long lives the logarithmic function.

... And the square-root radical function.

Tue, 11/29/2011 - 23:38 | 1928496 trav7777
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and the derivative of e^x is...

Martenson isn't saying anything others haven't said before

Tue, 11/29/2011 - 23:43 | 1928519 redpill
redpill's picture

More importantly, it isn't anything he hasn't already said in the Crash Course videos that are available for free on his website. Which are quite well done. I don't think he makes a claim that he was the first to make these assertions, but he does present them in a clear fashion, and it's actually a great intro to reality for any of the sheeple in your circle of family/friends that may be remotely interested in coming out of the American slumber of trivial living where all that matters is who won the latest reality tv show and what's the hottest App download this week.

Tue, 11/29/2011 - 23:52 | 1928555 Unprepared
Unprepared's picture

That's exactly what I was thinking. I just tossed it around hoping that a slave or two from my circle of friends would lose sleep because of it (it allows me to skip questions from most: "do you actually believe in that bullshit?" - "nah, it's just for fun")

Wed, 11/30/2011 - 00:22 | 1928642 Oh regional Indian
Oh regional Indian's picture

People trapped in the sex, drugs and rock and roll daze need much more than warnings. THey usually get it when it slaps them in the face.

And I cannot understand these terrible projections for Alternatives in general. Energy/food/way of being. We must. There is no choice. Once that is clear... plus, we really need to CHANGE our minds.

Consumption down is the key first step. Not forced but voluntary.



Wed, 11/30/2011 - 01:06 | 1928747 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Hold on, hold on....

Sex can be ecstasy....

Drugs can be Nirvana....

And Music can be God.

Without substance they are lacking, and yes, misleading, but let's not just say the words without being precise.

Wed, 11/30/2011 - 01:15 | 1928770 Oh regional Indian
Oh regional Indian's picture

of course LH, of course! :-)

I meant fucking, krokodil and thrash metal!

Or was that Vouyering, Crystal and Gaga?


Wed, 11/30/2011 - 01:19 | 1928780 Mr Lennon Hendrix
Mr Lennon Hendrix's picture


Wed, 11/30/2011 - 03:05 | 1928976 Michael
Michael's picture

Complete and total worldwide economic collapse bitches!

There will be no aristocrat or oligarch family member left standing, that's how my plan plays out. I've been working on this plan a long time. It's a very good plan.

The mega-ton yield of the nuclear like explosion of the financial industry has been maximized for total devastation. The Dot-Com bust wasn't enough of a bust so we had a housing bubble bust much larger, but that wasn't enough to destroy the oligarchs so we had to think bigger. We now have a 700 trillion credit bubble combined with non-repayable national debts and entitlement liabilities of astronomical proportions that can never be repaid. Such is the beauty of exponential functions to destroy the target you need to have destroyed with their own system.

I suggest you watch all 8 parts of this video series;

The Most IMPORTANT Video You'll Ever See (part 1 of 8)

Wed, 11/30/2011 - 03:31 | 1929012 Michael
Michael's picture

The USA will be lucky in the economic collapse to have enough money for maintenance to keep our naval fleet from rusting out like the USSR's did, or to keep our fighter jets from falling from the sky.

That's what you get, if you're lucky!

That's what the banksters and special interests did to us. Worst case scenario; if the Ron Paul crew doesn't take charge, nobody gets nothing. Nothing!

Wed, 11/30/2011 - 04:01 | 1929034 zhandax
zhandax's picture

I don't think Chris is saying that the collapse will take 20 years; it seems more likely he is predicting that it will take 20 years for the asshat 'experts' and bought politicians to concede that it has already happened.  Although I don't underestimate the degree of denial, I personally I think he is wildly optimistic.

Wed, 11/30/2011 - 04:22 | 1929047 Michael
Michael's picture

Looks to me like the economic disaster is happening sooner rather than later.


Let me share this with the Ron Paul crew, this is a great comment on a pretty good article;

"If people knew and understood the philosophical consistency and intellectual depth of Ron Paul and studied the books of the people from whom he draws his principles, the election would be over and America would be saved. Although Dr. Paul is sometimes accused of being a Randian, this is a lie. While he mentions her, and what libertarian wouldn't, he actually draws his beliefs from John Locke, Ludwig Von Mises, Murray Rothbard, Hans Hermann Hoppe, Carl Menger, F.A. Hayek, Randolph Bourne, Lew Rockwell and others of the Austrian school. It is an American shame that most people are ignorant of the arguments these individuals have made for liberty and free markets. Their writings are kept from the American people and our educational establishment so the media can be left to frame debate. This censorship and media filtering is a form of thought control. The ruling class knows it is better off if Americans are divided and spend their time arguing about gay marriage and flag lapel pins. Americans, I beg you. Please educate yourself and discover the questions that need to be asked. Learn how genius economists, statesmen and philosophers have advanced the arguments for liberty and free markets. Read how they have answered questions regarding liberty, peace and prosperity after having made the study of economics, history, war, government, philosophy, religion and liberty a lifetime endeavor. When people understand that all other politicians are statists, except for Ron Paul who champions the individual, their choice for who to elect as president will be made clear.

BY Joseph Zrnchik on 11/29/2011 at 06:31"

Ron Paul should hold hearings on secret Fed bailouts

Wed, 11/30/2011 - 04:49 | 1929059 zhandax
zhandax's picture

I personally I think he is wildly optimistic

While I stand by the original comment, I should have elaborated.  Chris is absolutely correct in his timeline for the exponential function to play out, but I don't think he elaborated enough on the significance of the 'red line wiggle' in the slide introduced just before the 7 minute mark.  That 'wiggle' screams that reality will intrude before the pure mathematical function will play to its inevitable conclusion.  This reality is what will attract the full-court press of the MSM denial squadron.  And Michael, it is probably a corollary of the MSM's denial of Dr Paul's existence.

Wed, 11/30/2011 - 04:48 | 1929062 Michael
Michael's picture

A strategic outcome of all this is China's refusal to trade with the USA. Especially not after the US placed a bullseye hit with a bunker buster bomb on The Three Gorges Dam Project in a made up scuffle. But I digress.

Imagine a day when the people of this USA have to fend for themselves? Cut off from the rest of the world. This would be a great blessing.

Wed, 11/30/2011 - 05:04 | 1929069 zhandax
zhandax's picture

Michael, don't think me an apologist for what is happening here, but the fact remains that there are only a couple of 15T economies, and the one we live in has about half the stated debt level of the other.  Similarly, I am no apologist for the banks, but ours are (on average) leveraged at 13X while the EU's are more like 26X (we at least "recapitalized" ours in name at least).  If China refuses to trade with us, we will have ample notice because we will not be first on the list.  (even if it is at 11:59 H/T to Chris)

Wed, 11/30/2011 - 05:15 | 1929073 Michael
Michael's picture


And we can adapt very quickly and new business will spring up like that new textile mill in Texas. We can have them all over the US in family owned businesses among all other kinds of businesses the public will demand.

Good night.

Wed, 11/30/2011 - 06:03 | 1929087 Michael
Michael's picture

OK, one more thought;

If you've not been searching alternative Internet news, shame on you.

I'm trying to think up a saying to promote alternative Internet news over the MSM.

Wed, 11/30/2011 - 09:50 | 1929536 trav7777
trav7777's picture

why, are you antisemitic?

Wed, 11/30/2011 - 10:53 | 1929902 Bicycle Repairman
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"The USA will be lucky in the economic collapse to have enough money for maintenance to keep our naval fleet from rusting out like the USSR's did, or to keep our fighter jets from falling from the sky."

If the collapse hits every nation, then our enemy's ships and jets will rust.  Why would we worry about ours?

Wed, 11/30/2011 - 06:48 | 1929108 disabledvet
disabledvet's picture

you forgot your evil laugh.

Wed, 11/30/2011 - 06:46 | 1929107 old naughty
old naughty's picture

Well said, ORI. Right thru the heart of the matter. But unfortunately for us, consumption is not down, instead it is fast-forward into the abyss. Sigh.

Wed, 11/30/2011 - 07:02 | 1929121 Oh regional Indian
Oh regional Indian's picture

Thanks ON. Crazy eh? Super-consumption in the face of vanishing life! What a species eh?


Wed, 11/30/2011 - 14:23 | 1931350 Pitchman
Pitchman's picture

See how money, created out of thin air has exploded the worlds financial sector and, it can disappear as if it never existed:

Evaporation of Wealth on a Vast Scale: How $Millions - Trillions Can Disappear

Here's something else you might find interesting.

 Graphic: Financial World Dominated By A Few Deep Pockets

Also See: Fibonacci Numbers - The Fingerprint of God & God Within

Wed, 11/30/2011 - 03:15 | 1928999 mr_T
mr_T's picture

I was there. Good speach by Chris..nice guy. You got 3-5 years left to drive your Hummers & RV's . We have peaked ... Can't say we didn't have a good time. Now go get your shoeshine box.

Wed, 11/30/2011 - 06:45 | 1929106 grey7beard
grey7beard's picture

>> You got 3-5 years left to drive your Hummers & RV's .

That's pretty much how I planned and figured it.  I just returned from a 23,000 mile RV trip from South Florida to Northern Alaska. I figured it was my last chance to take a trip of a life time.  I've been a minimalist and conservationist my whole life but realized WTF, nothing I do makes an iota of difference when  our whole society is built on gluttionus consumpion.  I saw a lot of really cool shit.  Now I'm back on my 10 acres of paradise out in the boonies and my priorities are to get my little hobby farm operating.  The RV was set up for off the grid operation so if I can't sell it, it makes a really nice off grid survival shack.

Fasten your seat belts folks, there's some bumpy weather ahead.




Wed, 11/30/2011 - 15:31 | 1931767 Seer
Seer's picture

I'm trying to get my "farm" to be a "life farm."  It's zoned agriculture, but really should be zoned aquaculture :-)  (never will have to worry about water!)  Lots of work to do, and I'm also sporting a grey beard :-()

Delivery to market is going to be a bitch with vastly reduced oil!  Need to get some of the horse people around me to wake up and start gearing to apply those horses for meaningful work.

Wed, 11/30/2011 - 05:29 | 1929080 Sorynn
Sorynn's picture

Martenson's crash course allowed me to communicate the trends I was seeing in a non fear based approach to my wife and some friends and family.  Sadly, they still can not get past their social programming.  However, they no longer think I am completely crazy.


Wed, 11/30/2011 - 16:03 | 1931922 Seer
Seer's picture

Good way to describe things: "social programming."  I don't necessarily see people as being flawed so much as I see them being poorly programmed.

My ex was a great example, that's why she because my "ex."  She left, couldn't adjust: even though we never got out of the urban environment (had been planning, though mostly it was I who was doing the planning).  Now, however, she "gets it!" (has property, chickens etc.)  I'm happy for this.

My current wife just plain kicks ass, she's picked up on stuff extremely rapidly: helped that she wasn't of this consumer culture.  In less than a year of now living in the rural countryside she's built quail hutches and has about three dozen quail; is managing (operationally) a couple dozen layer chickens and a half dozen ducks (the layers and ducks are in totally portable environments); she's also started making bar soap.  I've likewise done a huge amount, but I'd already programmed myself for it a long time ago...  Broilers and pigs are on our project list for next year.  Nothing like having visible feedback to your efforts/work.

Tue, 11/29/2011 - 23:46 | 1928529 Unprepared
Unprepared's picture

Not to make a fuss about it, derivative doesn't beat the exponent: the derivative of an exponential funciton is still an exponential function (d(ex) = x.ex-1).

The Logarithm on the otherhand, callapses the exponent like anti-matter (Ln(ex) = x)

Wed, 11/30/2011 - 00:23 | 1928645 HoofHearted
HoofHearted's picture

Uh, you're quite clearly "Unprepared" for calculus with that one.

Go back and look at the difference between power functions and exponentials. The reason we choose e^x from among all possible exponentials is because the derivative is itself. It makes for nice solutions to differential equations like y' = y.

Wed, 11/30/2011 - 00:29 | 1928656 Variance Doc
Variance Doc's picture

Mathematical nonsense.  If you did go to college (looks doubtful) please destroy your degree 'cause it's worthless:  The derivative of the exponent is NOT X*e^{x-1}.  It is itself via the chain rule.  That is, d(e^{x})=e^{x} via the chain rule.

Wed, 11/30/2011 - 01:08 | 1928754 HoofHearted
HoofHearted's picture

Your degree may not be that much better.

You don't need the chain rule to show that the derivative of e^x is itself. Just go to the definition of derivative, remember that e^{x+h} = e^x * e^h, and you're pretty much done.

If we the ZHers don't know simple calculus, it is no wonder that BAC, C, GS, JPM, and MS are all going down the toilet.

Wed, 11/30/2011 - 01:14 | 1928767 trav7777
trav7777's picture

yes I threw that one out there as a test LOL

Wed, 11/30/2011 - 02:13 | 1928782 caerus
caerus's picture

chain rule is needed to prove...


f'(x) = lim h->0[f(x+h) - f(x)]/h

let f(x) = ex; then

f'(ex) = lim h->0[ex+h - ex]/h

f'(ex) = lim h->0[exeh - ex]/h

f'(ex) = lim h->0ex[eh-1]/h

f'(ex) = ex lim h->0[eh-1]/h

limit is inderminate but you can sub point (0,1) and prove graphically...crude i guess...

scotch and math don't mix

Wed, 11/30/2011 - 16:10 | 1931973 Flakmeister
Flakmeister's picture

Or you can take the Taylor expansion and differentiate just drops out


Wed, 11/30/2011 - 02:06 | 1928878 Variance Doc
Variance Doc's picture

Moron.  Of course you can "just" use basic definitions for these simple functions, but that will not get you very far in mathematics as you so aptly demonstrate.  Generality is the essence of mathematics, hence the use of the chain rule to find the derivative of the composition of functions.  Just STFU with your Bronze Age "knowledge" of calculus.

Sat, 12/03/2011 - 17:10 | 1942225 HoofHearted
HoofHearted's picture

Moron my ass. The morons are the ones who sit through my calculus classes, learn a few basic tricks, and then forget all about the definitions. You don't need to take out a sledgehammer to kill a fly. Save the fancy stuff for when you're doing stochastic calculus. No need for all that newfangled 200 year old technology for something so simple.

Tue, 11/29/2011 - 23:49 | 1928540 caerus
caerus's picture

the exponential function describes (among other things) bacterial growth and ponzi schemes...coincidence?

Wed, 11/30/2011 - 01:08 | 1928753 Temporalist
Temporalist's picture

Does it look something like this?


Agent Smith: I'd like to share a revelation that I've had during my time here. It came to me when I tried to classify your species and I realized that you're not actually mammals. Every mammal on this planet instinctively develops a natural equilibrium with the surrounding environment but you humans do not. You move to an area and you multiply and multiply until every natural resource is consumed and the only way you can survive is to spread to another area. There is another organism on this planet that follows the same pattern. Do you know what it is? A virus. Human beings are a disease, a cancer of this planet. You're a plague and we are the cure.

Wed, 11/30/2011 - 02:45 | 1928955 caerus
caerus's picture

alas...we are a culture confined to a petri dish

Wed, 11/30/2011 - 07:21 | 1929135 spankfish
spankfish's picture

Perhaps a primordial soup... hey its whats for dinner.  Soups on.

Wed, 11/30/2011 - 02:56 | 1928970 natty light
natty light's picture

"I'd like to share a revelation that..."

That is the line from the Matrix that really stuck with me.

Wed, 11/30/2011 - 05:19 | 1929075 Snidley Whipsnae
Snidley Whipsnae's picture

"Every mammal on this planet instinctively develops a natural equilibrium with the surrounding environment but you humans do not. You move to an area and you multiply and multiply until every natural resource is consumed and the only way you can survive is to spread to another area."


Chris makes an excellent point regarding Malthus; Malthus did not have a crystal ball so he could not forsee in ~1770 the end of sail, the transition to biomass, the transition to the use of coal, and the transition to the use of oil. Oil and natural gas products (I almost said derivatives) allowed the 'green revolution' which allowed an acre of arable soil to produce ~200 bushels of wheat vs ~2 bushels of wheat prior to oil.

We, as a species, have two choices. Reduce our numbers or invent some fabulous new technologies that will allow our numbers to continue to increase, or remain stable. 

When I asked for a show of hands for those wishing to volunteer to self extinguish, I saw none.

When 'our best and brightest' grads stop rushing toward Wall St to invent new bull shit forms of paper scams, perhaps they will have the time to get to work on the new technologies? But, in a world where the goal of the vast majority is to get as rich as possible as fast as possible, where is the incentive for the brightest to look for energy solutions?

Personally, I think we are collectively screwed... Or, maybe some new virus will come along and take care of the human population problem. It has happened.

I'm going for J&B in the muffin batter this morning.


Wed, 11/30/2011 - 07:14 | 1929127 chindit13
chindit13's picture

I suspect we'll be fighting over water before we're fighting over oil.  (Why do I think trav7777 is going to come in and trump me on this?)  Peak Eau?

Right now there is a child born in India every 57 seconds.  Water was already becoming a problem there even before China decided to try damming, on the Tibetan side, many of the sources of India's rivers.  China is also damming Burma's rivers, for hydroelectric power, though an ethnic rebellion and a scared government have put that on hold.  The Middle East may have been fighting about religion and land for the last few thousand years, but all of their future battles will be over water, and may even set relations back between Israel and Jordan, since right now Israel is "drinking Jordan's milkshake".  The US may have a strong export sector in ag, but in essence what the US is doing is exporting clean water when it exports grains.  The country will one day reassess this.

More hungry people, less arable land, and less clean water to irrigate it.  The good news is we can save on fertilizer if we don't have crops on which to use it.

I'm not going to volunteer to self-extinguish, but I made a choice long ago to take my gene pool with me on exit, which is the next best thing.  I can see a future CNBC where cheerleading anchors tout the "wonderful downside surprise" of a minus five percent year-on-year contraction, and where some future Fed Chairman says, "I think with the proper unaccomodating monetary policy we can achieve negative growth as far as the eye can see."


Wed, 11/30/2011 - 07:28 | 1929138 spankfish
spankfish's picture

Chin, we either get off planet or cull the heard.  I can just see all the global policy wonks coming up with a plan to cull the herd.  New Plan 9 from Outer Space coming I would guess... peak humanity.  As if we ever had it.

Wed, 11/30/2011 - 16:09 | 1931964 Seer
Seer's picture

"invent some fabulous new technologies that will allow our numbers to continue to increase, or remain stable. "

Technology describes a PROCESS.  It's a set of ideas/thoughts.  Clearly there's no shortage of thoughts/ideas.  What IS in shortage is actual resources that technology REQUIRES in order to become more than just a thought.

Wed, 11/30/2011 - 10:00 | 1929601 trav7777
trav7777's picture

Smith was laughably wrong.  Every other animal is limited in its ability to reproduce by natural are we.  We found liquid energy in the earth.  As the supply rate of it decreases, our equilibrium rate will go lower

dinosaurs wouldn't be extinct if nature found this equilibrium.  Predators don't eat enough humans either.

If you put deer on an island (JFC, just google this FFS), they don't achieve anything resembling equilibrium.  They reproduce out of control and consume all the resources.  YES, grass grows back.  But it doesn't replenish at the rate that the overpopulation of deer want to consume it.  Population crashes and rebounds but NEVER to a happy steady-state, precisely because the entire resource base was depleted before the crash.  The remaining deer live a squalid life of disease and malnutrition.  They get to eat at the rate the grass grows and the population stays at a point where there are no more or no less deer than can survive on a borderline starvation diet.

Think about that.  Think about resources in this context, how much can be shared to just eke out survival on the razor's edge of starvation.  That is the lesson of exponential collapse in the natural world.

Wed, 11/30/2011 - 10:51 | 1929894 Temporalist
Temporalist's picture

First of all Trav it's a quote from a movie.  Secondly, that is an equilibrium that is reached ultimately is it not?  Not a "happy" equilibrium but equilibrium nonetheless.  And when the grass grows faster there are more deer and then they starve again...and the next year there are fewer so more grass grows...back and forth in a cycle.


Incidentally do you really believe the dinosaurs were the cause of their own extinction?

Wed, 11/30/2011 - 16:15 | 1932003 Seer
Seer's picture

"Predators don't eat enough humans either."

Maybe you're speaking prematurely?  I sense that plagues (which ARE predators) will soon be visiting communities near you...  When sanitation systems collapse is when things will start getting really ugly.

Wed, 11/30/2011 - 01:05 | 1928739 cowdiddly
cowdiddly's picture

I have to give "Smiley credit" I heard it from him first.

Wed, 11/30/2011 - 07:22 | 1929137 vxpatel
vxpatel's picture

your point is what? did he proclaim himself a messiah or something?

Wed, 11/30/2011 - 09:34 | 1929425 Carlyle Groupie
Carlyle Groupie's picture

Trav7777; Martenson isn't saying anything others haven't said before

Funny how I've seen every one of Martenson's arguments and PowerPoint slides on The Hedge.

Does he actually get paid for these promotional speaking arrangements? If so many ZH contributors should be mighty pizzed off at the man who liberates intellectual property from The Hedge and passes it off as a new product.

Jus sayin'

Junk away.

Tue, 11/29/2011 - 23:41 | 1928514 phungus_mungus
phungus_mungus's picture

... and dividing by zero! 

Tue, 11/29/2011 - 23:26 | 1928466 kito
kito's picture

yes, i would say that more accurately describes my point. youre clearly the math guy, im just the short order cook........

Tue, 11/29/2011 - 23:37 | 1928494 Pladizow
Pladizow's picture

Great Presentation - expands upon some of the things Michael Ruppert discusses in Collapse,

Wed, 11/30/2011 - 00:56 | 1928707 Doña K
Doña K's picture

It may take 20 years for all components of his thesis to play out. But a collapse of one or some of the components may blow up sooner than we think. (Residential property is one.) Commercial next? $10 gas? War? Massive bankruptcies? 

Again. It has been exhibited many times in history, it may take time for things to unravel, but when it starts it deteriorates very quickly. Bank Runs, food shortages, empty gas stations, wild gangs in cities, riots,

Think of Watts, think of Katrina, think of Arab Israeli war fuel shortage.

When a three day weekend snow storm several years ago was predicted, all the milk in NYC was gone within a few hours. Where? I don't know but it was gone along with bread and many other items. Just a three day snow storm.

Guys, when she blows, there is going to be some nightmare scenario. TPTB, banksters etc. already have plans. Helicopters to their yachts, private planes to St. Bart’s and if criminally liable Brazil or other hideouts and non-extradition places like Paraguay. As most of you know the Bushes bought a big chunk of countryside there south of Bolivia sitting on top of a huge aquifer that can feed a large population.



Wed, 11/30/2011 - 01:17 | 1928773 trav7777
trav7777's picture

Watts and Katrina?  Those were black people.

Interestingly, Katrina was not the only flood that happened in the last bazillion years.  Tons of white areas flood every freakin year, jfc, the entire Mississippi watershed overran an assload of hectares of shit and there weren't any riots or looting or fuckin squalid rabble in a sports stadium raping women going to the bathroom.

Iceland unraveled and there wasn't a peep.  not a riot, no looting, nothing but civilized people behaving civilized. 

Wed, 11/30/2011 - 01:33 | 1928815 redpill
redpill's picture

It's not color, it's culture. Case in point, the Japan earthquake, after which there was no looting despite what was possibly the worst natural disaster we'll see in our lifetimes, providing plenty of opportunity to take advantage. But the stoic Japanese did none of that. They stood patiently in line waiting for food rations and water and never though of even cutting in line, much less raise a ruckus. They may be civilized to a fault with their tolerance of Fukushima. But regardless, it makes it even more disgusting to compare it with crazed Americans of every color bowling over their countrymen and scrambling for $2 towels in Walmart, asscracks showing because their obese butts won't stay in their pants. Makes me want to vomit.

Wed, 11/30/2011 - 02:52 | 1928967 BlackVoid
BlackVoid's picture

That is not true. There was just no media coverage of the looting.

Wed, 11/30/2011 - 07:47 | 1929150 Vlad Tepid
Vlad Tepid's picture

THAT is not true.  There has been plenty of coverage of what looting occured in Japan - where such coverage matters. The looting that did occur was an order of magnitude lower than what any US citizen would consider looting, was done entirely in the absence of occupants (hence it going undetected) and the most important point was that it was committed entirely by people from FAR outside the affected area - in essence, the disaster attracted the whole criminal element of Japan, and it didn't make a blip on international wires.  That's because criminals in Japan are an abberation rather than a functional sub-culture of their own.

Wed, 11/30/2011 - 02:54 | 1928969 Lord Koos
Lord Koos's picture

The amount of looting in New Orleans was, as a percentage of the population, not that large.  When definining looting, I don't count people getting food.  The cops were actually breaking open supermarkets for people so they could eat.  The media just focused on the small amount of people that were grabbing TVs, diapers, etc.  Their target audience is fear-based white people like Trav. 

Wed, 11/30/2011 - 10:23 | 1929766 trav7777
trav7777's picture

ROTFL, another mindfucked apologist.  Just wake the fuck up, dude.

Stop smearing your own race to try to bring them down to the level of others.

I suppose the police who were in the Wal Mart looting broke it open so 200 black people and 2 white people could have free T shirts and CDs, huh?  They were on the EDGE of survival, surely. 

The media DIDN'T focus on Katrina, moron...they did everything they could, like they always do, to COVER UP anything which doesn't portray blacks as spectacular or fluff up their collective egos.  In fact, they minimized everything, and did what everyone else does, blame someone white.

Katrina was an outbreak of Little Africa and is what happens when the strictures of white civilization are removed from blacks.  They revert to their own cultural norms as supported by their aggregate attributes.

Wed, 11/30/2011 - 08:27 | 1929225 Dangertime
Dangertime's picture

If culture was the driving force, would not all of the whites have rioted as well in New Orleans?  Or in all of the flooding in Iowa?  Or along the Mississippi?

Or how about all of those McDonald's beatdowns?  Perhaps that is the McDonald's Brand?

Wed, 11/30/2011 - 10:28 | 1929792 trav7777
trav7777's picture

or the difference between a black "Flash Mob" and a white one.

The media relentlessly shoves in our faces ANYTHING which pumps blacks up and won't even show a PICTURE anymore if a criminal perpetrator is black.

People think COPS and First 48 are racist as a result.  Even though the producer of COPS says that, yes, we actually STILT our coverage to UNDERSHOW black crime.  They remove footage of black arrests so that it can be closer to 50/50, when in reality it is far different.

First 48 shows actual murders; there's nothing they can do with these.  We train military trauma surgeons in blacked out cities like Baltimore and Detroit.  This is an actual fact.

There are so many actual facts out there that will twist your brain back into the proper direction that you almost have to intentionally TRY not to notice them.

I know, I know, it means that much of the silly shit you grew up believing is really FALSE and was all LIES.  But, isn't this site supposedly about waking up, the fucking RED PILL?

Yet the people around here will shoot you for even suggesting that this particular thought Matrix might be unreal.  This Matrix isn't even a good can simply avert your gaze from the television and use your own 2 lyin' eyes and notice this; it's hiding in PLAIN SIGHT.

Wed, 11/30/2011 - 10:30 | 1929717 trav7777
trav7777's picture

did you actually see the video of those black friday stampedes?  You might wanna check that out before making certain assumptions.

Culture?  Where does that come from?  Who makes that, the culture fairy?  Culture comes from PEOPLE, not the other way around.

Don't fucking call yourself RED PILL and be a defender of the Matrix.

Racial equality is a LIE and a MYTH.  EVERY SINGLE empirical measure demonstrates this.

Wed, 11/30/2011 - 03:07 | 1928905 Max Fischer
Max Fischer's picture



..... and the Vancouver riots/looting were mostly middle class whites - all because of a fucking hockey game...ridiculous.  What about all the rioting/looting during the Spanish Inquisition? There's both modern examples and historical examples of white Christians behaving no differently (or worse) than those blacks in La.  Only a delusional, redneck klansman can be dumb and brainwashed enough to imply that looting is a race thing. Quite frankly, you're despicable.  

Furthermore, on a infinitely grander scale, the looting of this country has been done primarily by rich, well educated, WHITE politicians and bankers. The scale of thievery and corruption by our rich, white plutocrats far outweighs the black guys in New Orleans stealing food, diapers and televisions who live in abject poverty.   

Regarding Iceland....did it ever occur to you that an incredibly small, frozen island in the North Atlantic might not be an appropriate comparison or template for the world's largest economy and how that economy and its people respond to a crisis?  You're comparing apples to oranges, but it fits your racist agenda so it doesn't matter to you. 

For every statistic that you filter through your white supremacist ideologies, you expose yourself further and further as a purveyor of lies and racist propaganda.  You just might be the most brain-fucked of everyone here. So long as you continue to fill these pages with your racist, despicable tripe, I'll continue to prove you wrong.  

Max Fischer, Civis Mundi


Wed, 11/30/2011 - 10:33 | 1929812 trav7777
trav7777's picture

bankers aren't white.  You might want to review the disproportionate ethnicty of the banking industry.

And furthermore, STOP CRAWLING ON YOUR BELLY.  Be a fucking man and get up off the floor, bootlicker.

Rioting during the fucking Spanish Inquisition?  No, you did not just say brought something up from FOUR HUNDRED FUCKING YEARS AGO as somehow relevant to NOW?

Iceland is frozen?   I can see your ignorance extends a lot further than was imagined. 

You prove nothing, Max, other than yourself a fool.

Wed, 11/30/2011 - 02:49 | 1928962 caerus
caerus's picture

melanin is meaningless...unless you're concerned with sunburn

Wed, 11/30/2011 - 10:35 | 1929818 trav7777
trav7777's picture

LOL, and yet it correlates very strongly with a lot of things as a matter of FACT.

Is there one of you who knows any FACTS?

Wed, 11/30/2011 - 16:27 | 1932081 Seer
Seer's picture

You're thinking that this is an evolutionary positive for whitey?

This couldn't possibly end up like Theresienstadt, could it?

That blacks and people of color would feel compelled to NOT line up like good little Jews might have a bit more meaning if put into full historical context.

Yes, I fucking GET what you're TRYING to say, but xenophobia isn't all what you might think it is.  Just watch what happens to those nice peaceful people in Japan (who are extremely xenophobic [Bass even noted this]) when things start to unravel.  I have this feeling that when this comes to play that we won't be able to communicate like this, in which case attempting to place a wager here would be meaningless.

I'm thinking that it'll come down closer to an issue of age than race and culture.  Logan's Run.  And for this reason I'm looking to make things BETTER for younger people (don't care what race or color).

Wed, 11/30/2011 - 03:11 | 1928990 zerozam
zerozam's picture

Who cares about exponentials - I couldn't take my eyes off the hot MILF to the left of Martenson... :-P

Tue, 11/29/2011 - 23:45 | 1928525 SgtShaftoe
SgtShaftoe's picture

We may have tightness in oil markets, and a fiat currency system, but the Malthusian resource trap is a load of it.  I did a post about it a while ago here:

Wed, 11/30/2011 - 00:06 | 1928594 CrashisOptimistic
CrashisOptimistic's picture

There's only one thing lower than a man who condemns his children to death by not preparing for oil scarcity . . . and that's a man who pimps his blog on someone else's traffic.

Wed, 11/30/2011 - 00:41 | 1928673 Ragnar24
Ragnar24's picture

Should he have copy and pasted the whole blog in the comment field?

If you actually took the time to read the blog then you might be able to attack the argument rather than the man (which is the reason ZH mandates pseudonyms).

If you're too lazy to manage that, the argument is in favor of preparation... but doing so by removing regs, geopolitics, and fiat currency.

Wed, 11/30/2011 - 01:16 | 1928772 CrashisOptimistic
CrashisOptimistic's picture

No.  You purposely interpreted the comment to say what you wanted, likely a 2nd account from the same parasite.

Don't pimp your blog on someone else's traffic.  If you think your thoughts will attract click ad revenue, then pay to have your articles posted.

Pimping blogs in comments is pathetic.  If you can't say things in 3 paragraphs, you're not going to be read in a comment anyway.  And if you pimp, you're just a leech.

Wed, 11/30/2011 - 02:27 | 1928913 SgtShaftoe
SgtShaftoe's picture

What a small pathetic, petty, sniveling, lonely, and hollow little man you must be. Do you want a hug?? Small dick?? Truth is, I was lazy and decided I didn't want to spend the time typing the whole thing since I spent ample time several months ago framing my thoughts on the same subject, and decided I'd rather spend time with my family than rehash the same...and include the link. I should have recognized I'd offend your precious little petty idea of etiquette, which is actually exactly how many of the most respected commenters that have graced this site over it's history (of which I've been commenting on since almost it's inception): Jesse (jesse's cafe americain) turd ferguson, and others; while bringing invaluable insight and information that untold thousands have gratefully benefited from.

Incidentally, I don't have any ads on my blog, it's just a place I use to collect my streams of thought for situations like these.  It's a public service, nothing else.

As you have nothing cerebral or intelligent to say, and obviously have a challenged capacity for reason and logic, please excuse me as I ask you to please go Fuck Off!!

Wed, 11/30/2011 - 04:57 | 1929066 pufferfish
pufferfish's picture

I logged in just to press your small red arrow. Because of this diatride, I will never read your blog. Your philosophies differed on the use of the Internet. Your sparing partner made his point in a succinct and articulate way. You responded with attacking his penis size (?) and swearing perfusley and not addressing any of his key points. If you have a message for the world, you may want to consider how you dress it up, because the conduit for your message so far will only seek to inspire those from a particular class and those with an iq akin to their shoe size. Decorum is the watch word.

Wed, 11/30/2011 - 00:31 | 1928655 Ragnar24
Ragnar24's picture

Well said sir. I read your post and that's been my argument for a while now (and it drives the "devout" peak oilers nuts). No one's arguing that oil's NOT a finite resource... just that "peak oil" doesn't mean the end of abundant energy.

Removing regs and other impediments (Malthusian-driven wars to control Eurasia) we might have a chance at real price discovery and a market-driven transition from one diminishing energy source to that of a relatively more abundant one (nuclear comes to mind)

And if, as Ron Paul so aptly puts it, a gallon of gas still costs "a silver dime" then the price has not fully reached the point where consumers will be willing to pay for the alternatives.

Wed, 11/30/2011 - 00:56 | 1928680 SgtShaftoe
SgtShaftoe's picture

Thank you, and you are completely correct! We seem to be a small group of the enlightened, Cassandras, somewhat like Hugh Hendry, Nassim Taleb, and Kyle Bass before they were cool, like Zerohedge used to represent (I hope it still does).  I just hope everyone else realizes how the world works before someone does something insanely stupid. 

Ron Paul 2012!!

Wed, 11/30/2011 - 00:55 | 1928717 Mercury
Mercury's picture

Oil may be a finite resource but natural gas (like methane) might not be.

It even exists on other planets and moons (which probably never had dinosaurs) like Triton.

Wed, 11/30/2011 - 01:24 | 1928791 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

To Triton!

Wed, 11/30/2011 - 06:09 | 1929088 Potemkin Villag...
Potemkin Village Idiot's picture

Yeah, but do they have farting cows?

Wed, 11/30/2011 - 01:46 | 1928850 Temporalist
Temporalist's picture

Methane is a good one actually because the more mammals there are the more methane there is.  Unfortunately one day someone is going to light a fart and the whole world goes up in flames.

Wed, 11/30/2011 - 06:49 | 1929109 krispkritter
krispkritter's picture

Someone get Barney Fwank on the phone...and find me a BIC!

Wed, 11/30/2011 - 07:04 | 1929122 nmewn
nmewn's picture

We have ignition...and lift off!!!...on the maiden voyage of the good ship Bwaney Fwank to explore the deepest reaches of public orifices & confounding bureaucracies ;-)

(Sponsered by One United Bank)

Wed, 11/30/2011 - 02:20 | 1928920 caerus
caerus's picture

i hear there's a lot of methane in uranus...see what i did there?

Wed, 11/30/2011 - 02:50 | 1928963 Milestones
Milestones's picture

you speak the planetary language cleverly.      Milestones

Wed, 11/30/2011 - 11:42 | 1929921 Flakmeister
Flakmeister's picture

Its Titan by the way.....

Out of curiosity, do you know how to compute the escape velocity of a gas from a planet as a function of temperature and atomic mass??


Wed, 11/30/2011 - 16:41 | 1932157 Seer
Seer's picture

"transition from one diminishing energy source to that of a relatively more abundant one (nuclear comes to mind)"

Did you WATCH the video?  Seems to me that Martenson made it abundantly clear that the materials necessary for the production of nuclear are ALSO in big decline: and that INCREASING the rates of consumption will only lead to an earlier exhaustion.

Behind all these energy-salvation modes are schemes to garner govt support- read "subsidies."

Also clearly noted in the video is that it's about MUCH more than just energy, it's about lots of things that we rely on.  Oil goes into an incredible amount of our "products."  There's also the glaring part about copper, but if you watched the video, which I'm sure you did, you will already know about that (and I'll spare you).

Martenson, and people like him, are fact and data driven.  If others want to base important things on non-facts and poor/no data, then that's their choice- I shouldn't, however, have to subsidize their hopium operations, they're free to experience evolution on their own (dime).

I find the peak-oil (production) deniers to be little different than the Obama hopium crowd.  I suspect that Trav is right, that our bigger problem lies with the Downing Effect.

Wed, 11/30/2011 - 00:05 | 1928583 Max Fischer
Max Fischer's picture



There are several errors in this video. 

First, oil production has GROWN 30% since 1978 - much to the chagrin of Peak Oilers everywhere.  

Second, while the discovery of oil fields has tapered and the "low hanging fruit has been found," the discovery of oil WITHIN those fields has RISEN due to technological advances. In fact, there's a relatively famous quote out there from an oil geologist who turns to the oil engineer and says, "You guys have discovered more oil than us."  It's true.  86% of all oil reserves discovered in the US have come AFTER the oil field was initially drilled, meaning that as technology improves, we're finding more oil within already discovered fields. The fact that oil production in the USA peaked when Hubbert said it might has been rendered meaningless by the huge oil discoveries within fields already drilled.  By 2010, Hubbert had predicted total catastrophe for the US.  In fact, US oil production was 3X larger than what Hubbert predicted in his doomer scenarios. 

Third, for every barrel of oil produced in 2007-09, 1.6 barrels were added to reserves.  Again, much to the chagrin of peak oilers, we're not falling off the far end of the bell curve.  

Fourth, there's been 1 trillion barrels of oil produced since the start of the "oil age" and there are ~1.4 trillion barrels of oil which are still accessible to extract from known fields.  

The facts you're hearing in the video are GREATLY misleading.  The original argument was that the compound interest function on our national debt would run faster than the rate of energy needed to service that function.  By turing ourselves into our own creditors where interest is rebated back to ourselves, and, additionally, by interest rates slowly and methodically approaching ZERO, Bernanke has totally SMASHED the compound interest monster.  That, coupled with peak oil fears NOT coming to fruition (just yet anyway), and "The Great Collapse" has been shelved AGAIN.  

Max Fischer, Civis Mundi

*All figures are from Yergin's newest book, Quest: Energy, Security and the Remaking of the Modern World

**Yes, I know, peak oil will one day be true.  On a long enough timeline, every disaster scenario occurs.  The question is, do you want to prepare for your retirement or the end of modern society?    

Wed, 11/30/2011 - 00:06 | 1928595 taraxias
taraxias's picture

I once had you pegged for a smart guy on here. I guess I was wrong.


(You should have referenced Yergin at the beginning of your post, it would have saved me wasting my time reading it)

Wed, 11/30/2011 - 01:25 | 1928795 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The smart guys, they come, and they go.

Wed, 11/30/2011 - 00:08 | 1928600 CrashisOptimistic
CrashisOptimistic's picture

As you have been instructed before, stop talking about NGLs and limit your numbers to Crude + Lease Condensate.

NGLs don't push diesel trucks around bringing food to your grocery store.  Crude does, and only crude does.

Wed, 11/30/2011 - 00:16 | 1928625 Unprepared
Unprepared's picture

How can you be so light, sweet and crude at the same time?

Wed, 11/30/2011 - 00:17 | 1928628 Max Fischer
Max Fischer's picture



Why don't you demonstrate to me a single CEO who has said, "You know, I just don't see any further growth in our industry because of a notable decline in available energy to maintain and grow operations."  Feel free to include big oil CEO's. 

Max Fischer, Civis Mundi

Wed, 11/30/2011 - 00:22 | 1928641 taraxias
taraxias's picture

Yeah, good idea, wait for them to tell you that until you wake up and see how that works out for you.


Shit, I used to think you had a half a brain. It seems all you were doing was regurgitating some book you read.

Wed, 11/30/2011 - 00:27 | 1928650 Max Fischer
Max Fischer's picture



I fail to understand what you're contributing to the discussion.  The points I made are FACTS.  What have you provided?  Nothing.  If you have a single point you wish to dispute, name it.  Otherwise, it might behoove you to watch from the sidelines, or spend some time shaving your wife's face - she's looking hairy despite her glorious smile. :) 

Max Fischer, Civis Mundi

Wed, 11/30/2011 - 00:38 | 1928659 taraxias
taraxias's picture

Did I hurt your feelings?


If referencing Yergin is your idea of FACTS, I think we have a problem here.


You debated peak oil before. You lost before. Stop continuing to show your vast ignorance which you try to pass off as intellect.


I have to go now, I'm not shaving my wife's face, she's seating on mine.

Wed, 11/30/2011 - 01:27 | 1928799 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

The only people that piss me off more than peak oil deniers are Keynesians. 

Wed, 11/30/2011 - 03:08 | 1928985 natty light
natty light's picture

Today's so-called Keynesians do Keynes an injustice. AAUI Keynes advocated building surpluses during good times to use during downturns for stimulus. We have been borrowing and spending through thick and thin for 30 years.

Wed, 11/30/2011 - 07:51 | 1929153 UK debt marsh
UK debt marsh's picture

Fact:  The production of every one of the Big Oil companies was lower in H1 2011 than in H1 2010.

The points you made in the earlier post above, about how 1.4 trillion barrels remain etc may indeed be true, but they are not answers to Martenson's points.  Peak oil is about flows not reserves.  Why is oil at $100 a barrel if there is so much of it available?

Wed, 11/30/2011 - 00:38 | 1928667 JW n FL
JW n FL's picture



you can look at the Industrial Production numbers from middle America in 2008 (welfargo).. you can read for yourself how lack of energy effected out put.

this all oges back to sour crude..

America can handle how much sour crude production? 15%? and that number was quoted to me from a knowledgeable person here.. but I would still believe we as a Country are capable of only 10%.

So I dont give a fuck about Matching Federal Dollars for Grid Worthy Builds..

I dont give a fuck about natural gas.

I dont give a fuck about fracking.

I dont give a fuck about stalled nuke plants.

I dont even give a fuck about India and China's 800 coal plants.

I dont give a fuck about any of those things becuase they dont keep the lights on at home.

Affordablle Oil has come and gone.

Lite Sweet Crude v Sour Heavy Crude

like the man said 1,100 feet under a desert, 3 miles from the ocean port with infrastructure in place.


30,000 feet under water.. and then another 10,000 feet under rock.. in the middle of hurricane alley.

wait I forgot nuke powered container ships to move commerce.




wake up.

Wed, 11/30/2011 - 01:10 | 1928758 CrashisOptimistic
CrashisOptimistic's picture

On Thursday, the energy blog reported on a December 2009 presentation by Petrobras CEO Jose Sergio Gabrielli in which he estimated that world oil production would peak this year. Gabrielli, head of Brazil’s national oil company, joined the ranks of other international oil honchos, including former Aramco executive Sadad al-Husseini and Total’s CEO Christophe de Margerie, in stating that the level of global oil production cannot keep pace with growing demand. The logical result of this trend is oil scarcity that will lead to quickly rising crude prices in the next few years.

Wed, 11/30/2011 - 01:47 | 1928790 Max Fischer
Max Fischer's picture



First of all, it will take several years to know if his assertion is correct.  

Secondly, and more importantly, has this led to a dearth in available energy to maintain current GDP growth?  No. Consumers are not starved of energy.  Corporations are not starved of energy.  And governments are not starved of energy.  To this day, there has been NO provable peak, and NO provable crisis from any supposed peak. None.  

Third, recent history has proven the EXACT opposite of all this PO noise.  In 2009, we added to reserves; same in 2008; same in 2007.  The facts are suggesting the OPPOSITE of what you doomers are preaching.  Sorry. 

Fourth, while the rise in oil prices over the past two years does have an affect on GDP, you cannot link peak oil to that rise.  It's due to increased demand like any other commodity or widget.   

Max Fischer, Civis Mundi

Wed, 11/30/2011 - 01:53 | 1928874 Mr Lennon Hendrix
Mr Lennon Hendrix's picture

Max, when your Mom told you you were a smart boy, she was lying.

Wed, 11/30/2011 - 03:01 | 1928977 Lord Koos
Lord Koos's picture

So you bascially deny the fact that we live in a economy based on infiinite growth while living on a planet with finite resources?  Yeah oil is there but it's a matter of supply and demand.  Demand is increasing much faster than the supply, thus the higher prices.  If you expect this to somehow reverse itself, or be solved by some scientific discovery, please explain how that will happen.

Wed, 11/30/2011 - 04:13 | 1929042 Max Fischer
Max Fischer's picture



So you bascially deny the fact that we live in a economy based on infiinite growth while living on a planet with finite resources? 

No. I do not deny that.  I simply deny the relevance of that to our current financial crisis.  There is ZERO evidence that declining energy supplies had anything to do with careless lending standards, overly greedy bankers with overly leveraged balance sheets full of over-marked shit, an overly gluttonous and consumer driven society, overly indebted countries with ponzi retirement plans, and a political climate that enables it all. Peak Oil had NOTHING to do with any of that shit. 

Demand is increasing much faster than the supply, thus the higher prices...

This is simply false.  As I've posted several times, in 2007, 2008, 2009 we added MORE reserves than we produced for consumption.  Net supply increased faster than demand. 

Prior to the crisis, it was a different story. The rise of oil to $150 was no different than the extreme increase in many commodity prices.  

Look at the price of corn before the crisis:



Do you think those parabolic charts are because of peak soybeans, peak wheat and peak corn?  Of course not. Same goes for oil.  

Certainly, worldwide demand for commodities was increasing, but the primary reason why the charts looked so extreme was because the commodity complex was flooded with new liquidity. In 2003, the commodities futures market was a ~$13B industry. By early 2008, it totaled over $300B, almost a 25X increase in five short years. The volume of index speculation increased by 1900%  Why? While investing in food had originally been a sleepy and boring business dominated by a few end-users like Cargill and ADM, it was suddenly the playground for hedge funds, pensions and sovereign wealth funds who got lured into the game by the guys at GSCI.  After many of the silicon valley IPO's crashed and burned, Wall Street decided to turn the world market for food and life's necessities into casino chips.  The entire commodities market ballooned.     

That's the reason for the higher prices in a wide swath of commodities, including oil, corn, wheat, etc.  It had nothing to do with "peak" anything.  

Lastly, $150 oil was definitely the match strike which popped the artificial bubbles, but $150 oil had NOTHING to do with peak oil, nor did oil have anything to do with the underlying house of cards which magnified the crisis into the worst since the Great Depression.

On a long enough timeline, yes, we'll have energy supply problems.  But there's no evidence of it today. 

Max Fischer, Civis Mundi  






Wed, 11/30/2011 - 05:01 | 1929065 caerus
caerus's picture

crops are renewable resources...(too bad no one wants to farm anymore) fossil fuels are not...

although energy is needed to plant and harvest...

i agree that there was an increase in liquidity in the commodity complex but this increase i think appeared for a reason...profit...investors sought to profit from basic supply/demand imbalances

an objective analysis of the energy markets is difficult because nations are not required to disclose truthfully their reserves or production data...THEY LIE

a true analysis would require accurate production data and an accurate assessment of demand in the "emerging world" that factors increases in standard of living, birth/death ratios etc...

i appreciate your analysis and your fervor...bonam fortunam

world population

Wed, 11/30/2011 - 05:16 | 1929074 Max Fischer
Max Fischer's picture




Braccae tuae aperiuntur.


Max Fischer, Civis Mundi



Wed, 11/30/2011 - 05:40 | 1929077 caerus
caerus's picture

fair enough :)

Wed, 11/30/2011 - 06:26 | 1929098 Potemkin Villag...
Potemkin Village Idiot's picture

So it's all just hedgies & their casino chips right?

Tell me something... Have you ever stuck a shovel into the ground and grown something to eat?... Your chia pet doesn't count...

I'd like you to do a little experiment... Go grow yourself a year's worth of food (the kind you usually like to eat), then calculate the costs... Now scale that up a bit and take on the costs of sending it all around the planet to feed all your friends...

I'll give you a hint, it ain't the SEEDS where you start running into problems (on either scale)...

Wed, 11/30/2011 - 10:40 | 1929837 trav7777
trav7777's picture

Jeezus fucking christ you are

Wed, 11/30/2011 - 11:17 | 1930048 Bicycle Repairman
Bicycle Repairman's picture

Max, illegitimi non carborundum.

Wed, 11/30/2011 - 12:44 | 1930307 Flakmeister
Flakmeister's picture

Grima... are you back with your gratuitous junkings?

You really shouldn't play in the big boys sandbox... maybe in a few years, now run along...

Wed, 03/21/2012 - 07:09 | 2276144 Bicycle Repairman
Bicycle Repairman's picture

Flakey, GFY.

Wed, 11/30/2011 - 16:57 | 1932262 Seer
Seer's picture

Everything is stated between the lines, otherwise there's chaos.  You're not going to get any "announcement" on the TV; that is, in any timely manner.

As Martenson noted, and I'd many years ago brought this to the attention of someone else who was very studied in energy (and influential), the REAL issue for concern is PEAK EXPORTS.  I hadn't noted any actual numbers until hearing it just now from Martenson (only 35 million bbl/day are actually traded in the markets, the rest is consumed locally/internally).  Not a pleasant thing to consider when you're a BIG oil importer.  But, just because it's unpleasant doesn't mean that its ramifications shouldn't be considered.  That this would be the reaction shouldn't surprise any rational-thinking person.

Wed, 11/30/2011 - 00:28 | 1928644 caerus
caerus's picture

errors in your supply data neglect to mention demand increase in your argument

Wed, 11/30/2011 - 01:35 | 1928819 Econolingus
Econolingus's picture

There is one error in your post: believing what Yergin writes.

CERA is a church of disinformation for the petroleum industry, and Brother Daniel is its High Priest.  Do your research; it is easily proven.

Wed, 11/30/2011 - 03:13 | 1928994 natty light
natty light's picture

And Yergin used to write about energy shortages in the future. Time to get paid though.

Wed, 11/30/2011 - 05:49 | 1929084 zgulgar
zgulgar's picture

Please pardon me but i have a question .

If , 1trillion used and 1.4 trillion is still available from known fields  = 2.4 trillion and if the age of the earth is what ? 4 billion years / please divide that and the so called abiotic theory of oil will equal a replenishment rate of ? and our extraction rate is ?

 lets add another 2.4 trillion just for kicks and again the replenishment rate is what and the EXTRACTION rate is what ?

Just womdering but my calcs say we are burning way more than can be replenished at our current world wide consumption.

and im just asking this i may be way uneducated about this subject lol but i am indeed trying to figure out how to get thru a rapidly depleting resource senario with costs going exponentioally higher with fewrer and fewer viable  easy to get to oil fields

thank you in advance for any good answer cheers )


Wed, 11/30/2011 - 11:51 | 1930322 Flakmeister
Flakmeister's picture

Shh.... doncha know there are bazillions of barrels of oil.... the world has a nice creamy nougat center of tasty hydrocarbons..

Wed, 11/30/2011 - 17:02 | 1932293 Seer
Seer's picture

And! the world really isn't a ball.  That is, if the eye turns objects upside down then we're really just staring at the center of the ball when looking in to space!  The surface, therefore, could very well be of infinite depth below us, there could be an endless supply of oil!

Downing Effect.  Cognitive dissonance.  Things just ain't looking to good for the survival of our species...

Wed, 11/30/2011 - 06:15 | 1929091 Potemkin Villag...
Potemkin Village Idiot's picture

do you want to prepare for your retirement or the end of modern society?

Oh... Thanks to wise men like you... I'm certainly more concerned at this point with my cozy retirement on the golf course consuming 25x of my share of the world's resources...

Let's let that problem of what will actually happen when the tube of toothpaste runs out be somebody elses problem... Glob it up today...

Wed, 11/30/2011 - 17:04 | 1932301 Seer
Seer's picture

What the hell is my brother doing posting here?  LOL!

Wed, 11/30/2011 - 11:03 | 1929977 Flakmeister
Flakmeister's picture

Max, tsk, tsk...

You fell into the trap of conflating boe and bbl.... rookie error.

Moreover, it is about flows not reserves. If I have an oil field of unknown size then what does it matter if I increase the OOIP if the flowrate does not increase. Look at the production curves for Kern River and get back to me, reserves went up, but rates went down...

So what if world production increased after the US peaked... it has not increased in 5 years despite every reason that a neo-classical economist says should make it increase being relevant: demand, cheap capital, new fields...

Peak oil occurs when no amount of money printing can increase the supply of oil....


Wed, 11/30/2011 - 17:09 | 1932327 Seer
Seer's picture

Clearly, as indication by the red arrow, people hate facts!

I'd advise to start talking along the lines of "peak oil production exports."  Sigh, but most folks only have a capacity to focus on a couple of syllables at a time...

The future will demand more compost.   I suppose that in this way they WILL be "active" participants.

Wed, 11/30/2011 - 18:16 | 1932764 Flakmeister
Flakmeister's picture

The junking is from a certain Bicycle Repairman if I am not mistaken....Its really funny, he goes around and gives himself up arrows and me down arrows....

Yep, Net exports are down, energy content of "All liquids" is flat to declining... We are getting near the EROEI cliff...

Wed, 11/30/2011 - 00:47 | 1928693 Hugh_Jorgan
Hugh_Jorgan's picture

In the timescale of mankind, yes. Not in the scale of modern history.


4th Turning, bitchez...

Wed, 11/30/2011 - 01:35 | 1928823 myne
myne's picture

If anyone's up for a scare, open wiki on coal, and excel.
Copy the reserves, last x yrs production in, work out the avg increase % of production, and extrapolate till global reserves are 0.


You dont have to be a greenie to figure out that no coal = no steel = no civilisation. You also need to be very afraid because noone is even considering reserve lifespan based on increasing usage. They're all quoting hundreds of years 'at current production rates'.

Wed, 11/30/2011 - 02:56 | 1928971 steelrules
steelrules's picture

A small meager increase of 7% y/y doubles consumption every 10 years.

For all you math buffs and end of oil deniers.

Wed, 11/30/2011 - 17:12 | 1932343 Seer
Seer's picture

I'm waiting for those tossing out red arrows to counter what's being stated.  I mean, do you believe that MATH is invalid?

Wed, 11/30/2011 - 08:24 | 1929223 Momauguin Joe
Momauguin Joe's picture

The long emergency, as Kunstler calls it.

Tue, 11/29/2011 - 23:22 | 1928437 Captain Benny
Captain Benny's picture

Our descendents will look back upon history and wonder "What the hell were they thinking?  They had every warning sign.  They had the math and science to prove there wasn't enough oil-derived energy.  They had full knowlege that the currency was fiat and based on nothing but future labor and debt, controlled by a few ellusive people.  They instead fought wars around the world for no reason other than to claim they were 'liberating' people."

Hell, we have some 7 billion people on the planet now.  That isn't sustainable.  The planet cannot produce enough food and resources to feed and shelter said people while maintaining the atmosphere, oceans, and the rest of the environment.  This generation shall surely see a mass die-off event and it shall scar our eyes so great that we'll be blind to the events of the day.

Maybe that scar is already being formed... I just saw a bunch of monkeys in Walmart fighting over towels.

Tue, 11/29/2011 - 23:34 | 1928485 Dr. No
Dr. No's picture

Our descendents will look back upon history and wonder "What the hell were they thinking? 

Only a few descendents will look back.  Think of it as a darwin moment.  All of those towel fighters are busy watchin MArtha Stuart, scanning T.V. with 500 channels, eating Olestra.  They are not suited to continuing the progression of the species.  Only due to a strange misallocation of values has our society reached this evolutionary dead end moment.  We need to have a mass bacterial colony die off in order to rebuild a antibiotic resistant strain.  Humans will be stronger.  Ask the survivers of the depression and even more extremem society break downs ( such as Weimar, Soviet, etc) if they shoud be fighting over waffle irons or should they be working to protect their family and property.   As this system continues to misallocate at break neck speed, greater will be the snap back to a more advanceable species pregression.

Tue, 11/29/2011 - 23:40 | 1928509 trav7777
trav7777's picture

you don't understand evolution if you think that's how it works.

Evolution doesn't care if you are smarter it only cares if your offspring have a differentially higher survival rate.  The decline of the oil age won't just kill off the stupid.

When deer on the island collapse, they don't produce super deer.  They live in disease and squalor

Tue, 11/29/2011 - 23:49 | 1928541 Dr. No
Dr. No's picture

When the deer on the island collapse, the racoons take over due to their ability to live off squalor.  I agree that survial rate trumps, but I assumed that intellegence could give the survival rate a boost over a similar life form with no intellegence.  The evolution of man would seem to support the thesis, bit I could be wrong.

Wed, 11/30/2011 - 00:16 | 1928626 OldTrooper
OldTrooper's picture

Could be wrong?  Clearly you've never seen the documentary, Idiocracy!  :)

Wed, 11/30/2011 - 00:35 | 1928635 r00t61
r00t61's picture

One of the extensions of the Fermi paradox posits that intelligence (like the kind we have), which initially arises from natural selection, and thus should prove beneficial in assuring our continued survival (which is, after all, the POINT of evolution), might result in us gaining the ability to destroy ourselves, via nuclear, chemical, biological weapons, complete resource depletion, or even financial shenanigans, etc.  Thus, paradoxically, our intelligence becomes the means of our own destruction.

This gives rise to the Stephen Hawking quote, "It is not clear that intelligence has any long-term survival value."

As a species, we've only been around 200,000 years.  For comparison's sake, the great white shark has been around 16 million years.  Modern cockroaches have been around 70 million years.  Jellyfish have existed for about 500 million years.

I'll be really impressed (though, I'll be dead, dammit) if our species can make it to 16M, 70M, or 500M years' worth of evolution.

Wed, 11/30/2011 - 01:17 | 1928774 cowdiddly
cowdiddly's picture

“Kilgore Trout once wrote a short story which was a dialogue between two pieces of yeast. They were discussing the possible purposes of life as they ate sugar and suffocated in their own excrement. Because of their limited intelligence, they never came close to guessing that they were making champagne.” 
Kurt VonnegutBreakfast of Champions

Wed, 11/30/2011 - 05:48 | 1929083 Mr_Wonderful
Mr_Wonderful's picture

“So, in the interests of survival, they trained themselves to be agreeing machines instead of thinking machines. All their minds had to do was to discover what other people were thinking, and then they thought that, too.”
? Kurt Vonnegut, Breakfast of Champions

Wed, 11/30/2011 - 11:09 | 1930011 Flakmeister
Flakmeister's picture

RT...  nice to bring up the Fermi Paradox...

My twist on it is that some significant fraction of technical civilizations do make it beyond the hydrocarbon age. You also expect some fraction to self-immolate themselves in a nuclear war.... Based on the physics and engineering it is very clear to me that a transition beyond hydrocarbons while maintaining the trajectory on Kurzweils trajectory is not a given...

Wed, 11/30/2011 - 17:17 | 1932393 Seer
Seer's picture

And then there's the next glacial period.  Propagating the human genome, despite the simplicity of sex, just ain't all that easy.  Sigh...

Wed, 11/30/2011 - 00:10 | 1928608 CrashisOptimistic
CrashisOptimistic's picture

This is the part that turns off minds when I talk to people.

"The smart and the educated will not be rewarded in the world we'll see for the rest of our lives.  The return of physical strength as a valuable trait is inexorable now.  Women will lose the right to vote, that they got only because oil de-emphasized muscle as valuable to society."


Wed, 11/30/2011 - 03:07 | 1928983 Lord Koos
Lord Koos's picture

If it was just about strength, we'd all be slaves to mules and elephants. You'll still have to be a smarter brute than the other brutes to survive & flourish.   Judging from your post, your chances may not be that good.

Wed, 11/30/2011 - 04:18 | 1929046 fnord88
fnord88's picture

Except smart educated people can see the future better than stupid ignorant ones, and learn to grow food, shoot guns and practice krav maga

Wed, 11/30/2011 - 10:43 | 1929849 trav7777
trav7777's picture

the smart will insofar as their ability extends to use intelligence to kill the strong.  Otherwise, I agree wholeheartedly.

Wed, 11/30/2011 - 17:19 | 1932412 Seer
Seer's picture

"Women will lose the right to vote, that they got only because oil de-emphasized muscle as valuable to society."

Wasn't the case with many of the American Indian cultures.

Yeah, with this vertical hierarchy that would be the case, but I'm not thinking that IT can persist.

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