Tom Lewis

GOP and Coal Launch War on America

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First published at The Daily Impact  May 16, 2015

 

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To celebrate their coming to power in the United States Senate, Republicans this week launched their answer to the imaginary “War on Coal” by declaring war on clean air, and thus on all of us. Newly elected West Virginia Senator Shelley Moore Capito introduced a bill that would make it impossible for the Environmental Protection Agency to regulate emissions from coal-burning power plants. Climate-change-denier-in-chief James Inhofe, celebrated for bringing a snowball onto the floor of the Senate in February to prove that global warming is a hoax, cheered Capito on from his throne at the Senate Environment and Public Works Committee.

The bill would not only eviscerate the Obama Administration’s Clean Power Plan, which has not yet been put into effect, but it would forbid rewriting it. Senator Capito said she was pushing the bill not to pay back the coal companies for hundreds of thousands of dollars in contributions, and not to make American cities look more like Beijing, but to “protect families and businesses.” She proposes to do that by making sure that said families and businesses are subjected to ever more air pollution and climate change, forever and ever, amen.

In addition, the newly elected Republican Congressman from West Virginia’s Second District, Alex Mooney, has introduced legislation to roll back the EPA’s  half-hearted efforts to rein in mountaintop mining.

In the Republican faith, the federal government’s efforts to restrain the choking black smoke gushing from coal-burning power plants, and the trashing of Appalachia’s mountains to get at the coal that is left there, are destroying the industry. Those who regularly visit the real world know it is not this delusional “war on coal” that has brought the industry to its knees, it is the competing natural gas industry, which is providing power plants with a cheaper, cleaner alternative. It’s something we used to refer to, in the old days, as “free enterprise.” When you add to those unfavorable free-market conditions a heavy dose of incompetence and criminality, you get a coal industry in ruins — screaming that it’s Obama’s fault, and ordering their wholly owned politicians to do something.

A perfect example of reality emerged this week when Patriot Coal declared bankruptcy 18 months after emerging from bankruptcy. According to an industry analyst, the reasons for its demise were “a union strike, infrastructure failures, fatal accidents and persistently weak coal markets.” Environmental regulations, aka the War on Coal? Not mentioned.

About those weak markets: the coal industry world wide expanded its capacity feverishly when prices were high a few years ago. They glutted the market, drove down prices, and bankrupted themselves (that’s why Patriot went into bankruptcy the first time). Then the natural gas industry discovered fracking and did the same thing — glutting the market, driving prices down, and simultaneously shooting itself in the foot and cutting the throat of the coal industry. Natural gas prices got so low that every power company that could do so, converted its generators to gas, and coal’s share of that market drops from half to 39%. Did Obama do that? No, he did not.

Never mind the facts, the Republican faith is firm: if we just pollute the air and trash the mountains, everything will be all right. Thank goodness there’s a Democratic Senator from West Virginia, Joe Manchin, to bring a little common  sense into the discussion. Wait, what? He’s a co-sponsor of Capito’s War on America bill?

Better stock up on face masks.

 

 

 


Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Oil: A Fit of Peak

From the keyboard of Thomas Lewis
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First published at The Daily Impact  May 7, 2015
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Arthur Berman is perhaps the most credible debunkers of oil hype on the planet because he is a highly qualified petroleum geologist and a longtime, top-tier employee of the oil industry. In a presentation early this year, he made an offhand remark in answer to a question about Exxon Mobil CEO Rex Tillerson. “Oh,” Berman responded, “Rex knows his company is in liquidation and he’s terrified his stockholders are going to find out.” I don’t know if anyone else heard a thunderclap at that moment. The discussion moved quickly onward, but I sat stunned (as I listened to the tape). It seemed to me I had just heard spoken aloud the essential truth of our industrial age: it’s in liquidation, and the people in charge are terrified we are going to find out.

Liquidation, also known as a going-out-of-business sale, is a stunning word to use about the oil industry, unless you think about it for a minute. A company in liquidation stops making or buying its product and keeps selling until its inventory is gone, then turns out the lights and locks the doors. Oil companies don’t make oil, they have to find it, and they aren’t finding any. What’s more, take a look at their capex (capital expenditures for exploration and development) numbers and you see that after a decade of increasingly frenzied and expensive searching for new oil fields, with ever-diminishing returns, the industry has virtually stopped looking. Which brings us once again to the shoals of peak oil.

Oil hypists have been declaring the “theory” of peak oil to be dead since the phrase was first used. Never more enthusiastically than when the shale oil “revolution,” a.k.a. the fracking boom, took hold in America five years ago. The assault on logic and uncommon sense was massive, well funded and for a time successful: for a while, the term “peak oil” became synonymous with “loser.” Not any more. Peak oil is back, and Rex Tillerson is, if anything, more terrified than he was at the beginning of the year.

First of all, peak oil is not a theory, it is a straightforward expression of mathematical reality. If you are using a resource whose supply is finite, at some point you will have used half of it. And by extension, of course, at some point you will run out altogether. But peak oil is not about running out, it’s about reaching that halfway point, after which the supply of oil will steadily decline toward zero. That’s because everybody goes after the cheap and easy oil first; the second half is harder and more expensive to get.

Once we drilled a hole a few hundred feet into the ground and watched a gusher soak the neighborhood with crude. Now we drill through four miles of rock in order to wring oil by the pailful out of a sponge made of stone. As if that were not enough evidence that we are, as someone said, taking jelly beans out of a jar that is no longer even close to full, consider the torrent of reports and articles that just in the past few weeks has documented our arrival at the peak:
 

The oil hypists would have us believe that this is all the fault of the collapse of oil prices last fall, and all will be well as soon as this temporary blip is over. But well before prices fell below $100 a barrel, the oil companies were giving up on their capex budgets and the frackers were up to their eyeballs in debt and running out of sweet spots to frack.

Where there is no liquidity, there is liquidation. Now the stockholders are finding out. Be afraid, Exxon. Be very afraid.

 

 


Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

The Crash of 2015: Vultures vs. Jackals

From the keyboard of Thomas Lewis
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First published at The Daily Impact  April 25, 2015
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So. How have you frackers been feeling, lately? Just checking. (Photo by docentjoyce/Flickr)

So. How have you frackers been feeling, lately? Just checking. (Photo by docentjoyce/Flickr)

 


The crash of 2015 has been paused temporarily by a curious circumstance: a brawl among the financial scavengers who by now should have carted away the body parts of the great American fracking boom. Against all logic, financial vultures are fighting with financial jackals for possession of the corpse, and while doing so are pumping transfusions into it even though decomposition is already well under way. Here’s what’s happening:

The Vultures believe the decline of American oil fracking is only temporary, a product of the sudden decline in oil prices that struck last fall, and that with the inevitable return to $100-a-barrel oil, the frackers will return to profitability. Now, this is a curious thing to believe when it is easily determined that the companies involved have had negative cash flows since the very beginning of their revolution,even at $100 a barrel. Nevertheless, the Vultures believe in their scenario so fervently that they have been amassing cash with which to buy up prostrate frackers at the bottom of the market and thus make billions as the market rises, phoenix-like, back to the skies. Private equity firms such as Blackstone, Carlyle Group, Apollo, and KKR, for example, have raised about $30 billion and are just waiting to see the floor to begin their coup.  But where’s the floor?

Funny story about that. The Hyenas have a similar strategy but are using different tactics. They are the ones transfusing the corpse with fresh money, buying up junk bonds and penny stocks by the dump truck load so they will be in position for the resurrection — not because they have bought the company but because they have bought into it. Their injections are keeping the corpses alive enough that they are still twitching: the death certificate cannot be signed, and the Vultures cannot land. It’s a scavenger standoff.

This is yet another unforeseen consequence of two serious infections afflicting our financial system (leaving aside, for the moment, the ailments of the fracking boom). One sickness is the enormous amount of cash, the largely unearned wealth of the two per cent, sloshing around in the frantic hands of managers under orders to do something with it, make the clients some decent return on investment, you know, like 20%. The other is the cold dead hand of the Federal Reserve, holding interest rates for all safe investments to around one per cent, forcing the frantic to take their money to a casino somewhere and risk it all in search of the legendary 20%.

The stock-market casino is on fire and it looks like the roof is going to come down any day now, so they’re not going there. They’ve already blown up the housing market, and pretty well saturated the subprime auto-loan bonanza, and have bought up a gazillion foreclosure houses to rent out (and in the process have found out just how much it sucks being a landlord). “Over here!” someone yelled a few months ago, “I found 12%!” And the stampede was on, leading to the current contretemps between buzzards and hyenas.

But the zombie companies that have lured them in to the feast are, in fact, still dead. Bloomberg reports that half of the 41 fracking companies now doing business in the United States will be gone by year’s end. And that Schlumberger Ltd., the world’s largest oilfield services provider, will lay off 11,000 people, the second largest downsizing since the oil-price crisis began (the largest? Schlumberger’s elimination of 9,000 jobs in January). Rig counts are dropping and so is production.

The dispute between the vultures and the hyenas does not make the corpse they are contesting more valuable. It simply delays the disposition of the remains and the resumption of the Crash of 2015. For maybe a week.

 


Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

The Theory of Everything Stupid

From the keyboard of Thomas Lewis
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To be a success in today’s America, it helps to either dumb or dumber. Why is that? (Photo by insomniacuredhere/Flickr)

To be a success in today’s America, it helps to either dumb or dumber. Why is that?
(Photo by insomniacuredhere/Flickr)

First published at The Daily Impact  March 30, 2015

Let me be clear: the headline of this piece is to be read, “The theory of everything (that is) stupid,” NOT “The theory of everything, comma, stupid.” It’s my intention to insult a lot of people here, but if you are reading this without benefit of a forefinger, not you.

America is subsiding into a new Dark Age. Its leaders are more ignorant every day, its authorities more brutal, its people more supine. To remain ignorant when the availability of information is greater than it has ever been in human history, to govern viciously and intrusively when the government is more powerful and the governed more subservient, than ever, defies comprehension. Until we formulate a theory of everything stupid.

First, a quick tour of recent manifestations:

1. Stupid Leaders

  • The governor of Florida, the state that will be the most and earliest affected by sea level rise in a warming world, forbids the use of the term “climate change” by state employees.
  • The Virginia legislature refuses to consider urgent pleas for help from the city of Norfolk  in its struggle to stave off rising seas until the city edits out references to “sea level rise” and substitutes “more frequent flooding.”
  • Ted Cruz. Enough said.
  • Ted Cruz is not alone. Most of the people on the verge of running for president next year are against health insurance, don’t believe humans are causing climate change, are oblivious to the physical decline of the country, and lust for another war with somebody. Anybody.

2. Stupid People

  • According to the Pew Research Center, onl  y 35% of Americans think climate change is a “very serious” problem, and that’s down 10% from one year ago.
  • American “millennials” — those born since 1980 — when tested and compared with those of 23 other countries, came in 17th for literacy. For problem-solving with technology they were in a four-way tie for last place (with the Slovak Republic, Poland and Ireland). And — whoa! — for numeracy they achieved a three-way tie for last place. They were tested by the Education Testing Service, largest in the world. And in this test “literacy” did not mean familiarity with the classics, it meant “the ability to understand and follow simple instructions.” Similarly, numeracy had nothing to do with calculus and more to do with the ability to make change.
  • In the 2014 national elections, just over one in three of the American who were eligible to vote, did so. The lowest turnout since World War II. How stupid is that? And who is to blame for that?

3. Brutal Authorities

  • The United States imprisons more people — 2.3 million a few years ago — than any other country (China, with four times as many people, is second with 1.6 million). And it jails a higher proportion of its people — one of every 100 adults.
  • Police in the United States shoot and kill more citizens on the streets than the police of any other country — more than a thousand a year by most estimates (astonishingly, no one keeps an official count). In 2011, police in Germany killed six people, in England, two.
  • Militarization of the police, surveillance of the general public with cameras, NSA monitoring of private emails and phone calls — all have become a pervasive part of American life. Of whom is the government, at every level, so afraid?

Here’s the theory that connects the dots. The people who now run America — Citi Bank, Exxon Mobil, the Koch Brothers, Golden Sacks, and their ilk — have the money to get what they want, and they want stupid. It cost them gazillions to elect people like Ted Cruz, to convince 65% of Americans that climate change is not a serious threat, and to otherwise insure that inquiring minds will not be inquiring into anything they do..

When the stupid get the money, more people get more stupid, quickly. When the stupid get elected, all future candidates get stupider. When stupid movies and TV news programs get funded, very soon all entertainment is stupid, including sports entertainment (in 40 of the states, the highest paid public official is a football or basketball coach).

As for the brutality, consider this. If your hold on wealth and power depended on all Americans staying stupid, all the time, wouldn’t you be afraid?

So there you have it, a theory of everything stupid. Just follow the money, stupid.

 


Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

The Crash of 2015: Reckoning Day

From the keyboard of Thomas Lewis
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You have a perfect plan. Then things begin to go south and before you know it, a day of reckoning.

You have a perfect plan. Then things begin to go south and before you know it, a day of reckoning.

First published at The Daily Impact  April 1, 2015

The next phase of the Crash of 2015 begins today. The first quarter of the year is now complete, and that means two things for the debt-logged companies trying to stay alive in the U.S. oil fracking patch: it’s time to report the value of their assets to the issuers of their lines of credit; and it’s time to repay or roll over a bunch of the debt with which they are logged.

That first one is the killer. These companies, virtually every one of which has had negative cash flow from the beginning of the so-called “oil revolution, have sustained themselves first with stock issues, then with junk-bond issues, then with subprime loans. As slack as the underwriting of those loans has been, they do actually require the existence of assets whose value at least approaches the amount of the loan.

You and I, to get a loan, have to pledge a house or a car or something else that actually exists and can be seized by the lender if default occurs. Oil companies’ assets, on the other hand, consist mostly of oil that they say is in the ground they own or lease, that they say they can get at any day, and that will be worth money — if it is, and if they do.

You and I would not have the gall to take a deal like that to our banker, but it sure has worked for the frackers. As business analyst and blogger Wolf Richter put it, “loans to over-indebted, junk-rated companies soared from about $40 billion in 2009 to $210 billion in 2014 before it came to a screeching halt.”

Lenders typically review the status of their outstanding lines of credit after the first and third quarters. The last time they looked at the frackers, the oil the companies claimed to own was valued at $99 a barrel. Today, it’s going to be more like $50 (they don’t use the current market price, but a moving average).

If you owned a $200,000 house, with a $150,000 mortgage, and had income, you’d be good to go. Then you lose your job, somebody builds a pig factory next to your house and it now appraises at $100,000. The bank wants $50,000 in cash, now. Ouch. Only a fracker could appreciate your pain.

This agony is going to roll out over the next two weeks ago as financial statements are finalized and released. But already, Bloomberg News counts 10 companies circling the drain, gasping for cash. One of the bigger fish, Sabine Oil and Gas of Houston, has maxed out its credit line, says it is about to default on some $2 billion of its debt, and has “substantial doubt” about its continued existence.

In today’s enchanted world of high finance, normally banks don’t care whether loans are repaid or not, because before the ink is dry on the closing statement the loan is whisked out the back door to become part of a collateralized debt obligation, or some other Frankenstein security, the bankers get the money back that they just lent out, they pocket substantial fees, and do the next deal. But the collapse of oil prices was so sudden, and so completely not foreseen, that a lot of the smartest guys in the room got caught with hot paper still in their hip pockets.According to the Wall Street Journal (reposted here), “Citigroup Inc.,Goldman Sachs Group Inc.,UBS AG and other large banks face tens of millions of dollars in losses on loans they made to energy companies last year.”

In addition to the junk loans, coming to a head now, there are the junk bonds, which have been rotting fast since last fall. And if you still don’t see here the same deadly portents that preceded the crash of 2009, consider one more: Deutsche Bank has said publicly it foresees a 15% forfeiture rate of oil patch HY (high yield, i.e. junk) bonds.  “A shock of that magnitude,” says Deutsche Bank, “could be sufficient to trigger a  broader HY market default cycle. “

This is not an April Fools story. It is a story about some fools in April, facing a day of reckoning.

 

 


Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

47 Felons in the US Senate

From the keyboard of Thomas Lewis
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Stop the presses! We have 47 names to add.

Stop the presses! We have 47 names to add.

First published at The Daily Impact  March 12, 2015

 

When 47 United States Senators sent a letter to the government of Iran, presuming to explain our Constitution (which, the Iranian Foreign Minister immediately observed, they do not seem to understand) and demonstrating profound ignorance of international law, they did not merely embarrass themselves and our country, they broke the law. Their purpose was to prevent the Obama administration from reaching an agreement with Iran to prevent that country from manufacturing nuclear weapons (something the country has always professed it does not want to do anyway).

These Senators presumed to tell the leaders of Iran that should they reach agreement with the United States negotiators, who for years have been trying to find a way to limit Iran’s nuclear energy program to prevent weaponization, any such agreement would probably not be honored by the Congress or the next administration. Since no such agreement exists yet, they made this threat without knowing what would be in it. Doesn’t matter; if Obama did it, it’s evil.

The interventionist senators clearly and blatantly violated the Logan Act, passed by the Fifth United States Congress in 1799, expressly to prevent exactly what they did. The Logan Act says:

Any citizen of the United States, wherever he may be, who, without authority of the United States, directly or indirectly commences or carries on any correspondence or intercourse with any foreign government or any officer or agent thereof, with intent to influence the measures or conduct of any foreign government or of any officer or agent thereof, in relation to any disputes or controversies with the United States, or to defeat the measures of the United States, shall be fined under this title or imprisoned not more than three years, or both.

In the unlikely case that that language is not sufficiently clear and explicit, then consider what Justice George Sutherland wrote in the Supreme Court’s 1936 majority opinion affirming the conviction of Curtiss-Wright Export Corporation under the Logan Act:

The President alone has the power to speak or listen as a representative of the nation. He makes treaties with the advice and consent of the Senate; but he alone negotiates. Into the field of negotiation the Senate cannot intrude, and Congress itself is powerless to invade it.

While the signers of the letter preen about their conservative values, and their opponents pine about the unseemliness of it all, FBI agents should book every one of the signers on the felony charge of violating the Logan Act. Although it is in every sense an open-and-shut case, most of the perps would probably get reduced sentences on claims of diminished mental capacity. That, too, is an open-and-shut case.

On March 9, someone opened a petition on the White House website asking that the 47 signers of the letter to Iran be prosecuted under the Logan Act. The White House guarantees a response to any petition gaining 100,000 signatures in a month. Today, four days later, the petition has nearly a quarter of a million signatures. Click on this link to sign it.

If a law as clearly written and as firmly established in precedent as the Logan Act, can now be broken, deliberately and brazenly and without consequences, by people willing to endanger their own government’s integrity, their own nation’s security and international stability for momentary political gain, then it is time to say goodnight, America.

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

The Crash of 2015: The End of the Beginning

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Coming soon to an economy near you: a two-train wreck.

Coming soon to an economy near you: a two-train wreck.

First published at The Daily Impact  March 11, 2015

The setup continues of the double train wreck that will decimate the U.S. economy this year; the switches have been thrown to prevent either train from leaving the track, and the engines are accelerating. It doesn’t take much perspective, now, to see both trains, closing fast.

[Note: The Crash of 2015 is not expected to be the collapse of the global industrial economy, which will take a little longer.  Just another lurch downward of the shatteredTitanic, further unsettling those passengers who do not believe in icebergs.]

The end of the first quarter of 2014 will mark the end of the beginning of this disaster. Train Number One, the fracking oil industry, has only enough fuel on board to go a few more miles — it’s accelerating nevertheless, to impress its passengers — but that’s okay because impact will occur just before the engine quits. Train Number Two, the stock market, which for years has been speeding along the edge of a cliff, burning seemingly endless supplies of cheap money, has nowhere to go but down.

For Train Number One, fracking, the beginning of the beginning was last year’s plunge in crude oil prices. That led to massive and spreading layoffs, a stark decline in the number of rigs fracking for oil, but no reduction in  production. The reason: every producer in the fracking patch is up to its eyeballs in debt because each of these 10-million-dollar wells is only good for a couple of years of good production.

So what has March brought us from the patch, as the trains roll on?

How are things going on Train Number Two, the stock market? For a full, hair-igniting analysis read David Stockman’s essay, “Six Years Of Bull Market Bull.” Have the Pepto Bismol handy.

Suffice it to say here in summary that price-earning ratios remain swollen and inflamed, volatility remains violent, and leveraging is still malevolent. Or to put it in non-technical terms: the overwhelming majority of real businesses and real people are suffering and losing ground, while the stock market and the government estimates of “growth” magically levitate into the ether. This is what goeth before a fall.

Thus endeth the beginning. The middle of the end starts April one, when banks review the value of the assets on which they have given credit, and when all kinds of bonds and interest payments will be due.

Hear the rails humming? The trains are coming.

 

***

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Holding Accountants Accountable

From the keyboard of Thomas Lewis
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If I had known that was the name of my accountant’s firm, I don’t think I would have turned over my life’s savings…. (Photo by Indi Samarajia/Flickr)

If I had known that was the name of my accountant’s firm, I don’t think I would have turned over my life’s savings…. (Photo by Indi Samarajia/Flickr)

First published at The Daily Impact  March 5, 2015


It’s on account of accountants that we can’t count anymore, and someone should hold them accountable. We call them bean counters not to disparage them — honestly, I mean no disrespect — but to remind us and them of their purpose: to tell us how many beans are in the jar. When instead they tell us how many beans were in the jar last year; or how many beans would be in the jar if we had only put more in; or exactly how many beans are in a jar we don’t have and can’t get, they are not just failing to do their job, they are doing a great deal of harm to the people and companies and system they serve.

For example: Phase Two of the collapse of the fracking oil business is going to kick in with a vengeance a few days into April, not because economic conditions in that industry will suddenly get worse on the last day of March (they could hardly get worse, as it is) but because an accounting “rule” is going to kick in.

(I put quotation marks around the word “rule” when it follows “accounting,” even though this breaks the rule against blind quotes, which are quotes not attributed to someone. But this is a special case. We all understand the Golden Rule, and the Rules of the Road, because their intent and effects are obvious. Accounting rules, not so much.)

What oil companies own, mostly, is oil that is still in the ground. They call this oil “proven reserves,” even though nothing about the oil is proven, and even though everybody lies about how much they think is down there. Since no one can prove whether they are lying about their proven reserves, and there has to be a rule, the accountants at the Securities and Exchange Commission have come up with a not-exactly-air-tight one: a formula for valuing however many barrels of oil the company claims to have in the ground. It is the average of the market price of oil on the first day of each month in the preceding year.

So: On January 1st, when a company reported its net worth, it was based on the number of barrels of oil it claimed to own times $95. On April 1st, when the same company reports, it will multiply barrels times about $50. Net worth cut in half overnight. Thank you accountants. In a world where the riverboat gamblers in the stock-market casinos can trade hundreds of thousand of shares in a nanosecond, couldn’t we come up with a real-time evaluation of oil companies. You know, with computers and all?

But wait there’s more. Another bubble about to blow is the subprime auto loan bubble, which has been pumped up by the same people doing the same things that blew up the world economy seven years ago. The accountants I have in mind here are the ones who work for the rating agencies, who look at a package of car loans, each for more than the car was worth the moment its tires touched the open road, each made to a person who is as likely to repay the loan as to discover cold fusion in the ashtray, and conclude that on average, these loans comprise a AAA investment. That rating allows the few investment companies that are still under any kind of regulation  — your insurance company and your pension fund, for example — to invest in  these turkeys and to say, when they flatline, “Hey, not my fault, they were rated AAA!”

So when your bank fails, your pension checks stop coming, your insurance company’s phone is no longer in service and your stock broker’s obituary says he was “unexpectedly called to be with the Lord,”  and you want to know what happened, ask an accountant. And then hold him accountable.

 


 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

America’s Most Violent Terrorists: White Christians

From the keyboard of Thomas Lewis
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010917-N-7479T-508

Say “terrorist attack” to us and, like Rudy Giuliani asked how he’s feeling, we immediately respond “Nine-eleven!” But in the 14 years since 9/11, it’s not Al Qaeda operative who have been killing us. We have met the enemy, as Walt Kelly told us so long ago, and he is us. (US Navy/Wikipedia photo.

First published at The Daily Impact  March 3, 2015


“The domestic radical right has killed more people than radical Islam since 9/11 in the United States, without a doubt.” Those are  the words of Ryan Lenz, principal writer of a Southern Poverty Law Center study of violent “terrorist” attacks that occurred in the U.S. between 2009 and 2015. In a classic example of confusing ideologues with facts, the SPLC study found that while US security officials were focused exclusively on protecting against foreign organizations of Islamic extremists, Americans were steadily being picked off by home-grown, Christian lone wolves.

Here are the confusing facts that the SPLC winnowed from the facts of the cases:

  • The total number of “terrorist” attacks in the six-year period: 63, or on average, one every 34 days. (That is precisely the frequency of  school shootings in the U.S. since Sandy Hook in 2012, according to a CNN analysis.)
  • Three quarters of the attacks were conducted by a single individual operating entirely alone. Another 15 per cent were carried out by two people. That leaves 10 per cent that involved some kind of organization.
  • Half of the attackers expressed venomous anti-government sentiments, and were members of the so-called “patriot” movement of Christian libertarians (although the clubs, militias, Klans or whatever were not involved with the attacks).
  • The other half of the attackers comprised haters — of women, of abortion, of non-white people and of non-Muslims.
  • Most of the attacks (59%) involved guns, 25% explosives. The use of guns has been rising, the use of explosives is trending downward, because it has become more difficult to obtain explosive materials. Possibly because we don’t have a National Dynamite Association.
  • The Ku Klux Klan, thought by many to be a powerful force among the deranged, is a mere shadow of its former self. It has become a kind of Al Sharpton of the extreme right, showing up at events already in progress, littering the area with fliers, getting on TV, and bugging out before it’s over.

The SPLC is not the first organization to warn about the increasing danger of violent right-wing extremism. (By the way: although almost all these attack dogs are white Christians, it would be indefensible to claim their religion was somehow responsible for their criminality. You listening, Bill Maher?) The first organization to get its hair on fire over this threat was — wait, wait, don’t tell me — our own Department of Homeland Security. It was 2009, and in a report on “Right-Wing Extremism” the DHS said this:

“Lone wolves and small terrorist cells embracing violent rightwing extremist ideology are the most dangerous domestic terrorism threat in the United States.” The authors reported a surge in right wing extremism, and thought it was not a coincidence that it was taking place immediately after the election of America’s first black president.

The right-wing nuts went nuts. (The report was actually a confidential heads-up to police forces, but was immediately leaked to the wing nuts.) Because the report pointed out that the extremists were having some success recruiting among veterans, the American Legion among others screamed that the report was an attack on veterans. The leader of another fringe group, known as Republican Members of Congress — a guy named John Boehner — found the whole thing to be “offensive and unacceptable,” explaining that DHS was using the word “terrorist” not to describe Al Qaeda, but “to describe American citizens who disagree with the direction Washington Democrats are taking our nation.”

Almost immediately, DHS secretary Janet Napolitano (who, we must remember, worked for Barack Obama) withdrew the report, apologized for its contents, and accused the team that put it out of not following proper procedures. Virtually everyone who worked on the study resigned.

It used to be a joke to say, as Daniel Patrick Moynihan once did, “You’re entitled to your own opinion, but not to your own facts.” Where American right-wing nuts are concerned, it is no longer a laughing matter. Knowing the facts, about who is really out to get you, can be a life-and-death matter.

 


 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

When Life Gives You Yemens

From the keyboard of Thomas Lewis
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What happens when Yemenis have had enough, as they did in 2011. It’s not about which son of Allah you follow, or whether you get to vote; it’s about food and water and fuel. Always. (Wikipedia Photo)

What happens when Yemenis have had enough, as they did in 2011. It’s not about which son of Allah you follow, or whether you get to vote; it’s about food and water and fuel. Always. (Wikipedia Photo)

First published at The Daily Impact  February 24, 2015

When the nation of Yemen was put on a gurney and trundled down the hall from the global intensive-care unit to hospice, it was in pretty bad shape. The United States runs the ICU, of course, and has only two treatments to offer, whatever the symptoms presented: massive injections of cash, or invasion surgery. The outcomes are universally terrible, and have been since about 1950, but no one seems able to think of another approach. That may have something to do with the quality of diagnosis: a patient who is starving and dehydrated is unlikely to respond well to either a high-pressure currency infusion or a brain transplant.  

There is a global glut of glib explanations for the plight of Yemen and the nations with which it shares the hopeless ward: Venezuela, Libya, Bangladesh, Iraq, and the like. (Then there’s the waiting list: Brazil, Egypt, Afghanistan, Greece.) The pundits punt about sectarian strife between Shia and Sunni Muslims, or the struggle between the Yemeni government and Al Qaeda in the Arabian Peninsula, or the struggle for power among the Houthi Shia rebels and the Sunni government and the Sunni Al Qaeda (except, wait, the Houthi aren’t just Shia, they follow the Zaidi sect of Islam — never mind, Shia is close enough). Then there’s the “yearning for democracy” myth, which goes hand in hand with the “they hate us because of our freedoms” fallacy.

What has actually been happening in Yemen, and in just about every other disintegrating country in the world, is happening because their people are increasingly without food, water, energy and hope. And these conditions are the result primarily of two things: peak oil and climate change. We need to know this, because we, too, are about to be subjected to the ministrations of these evil twins, and understanding what they are doing to Yemen might give us an inkling of our own future.

Instead, we are on a diet of Yemenade. The US has “supported” Yemen, we are told endlessly, with hundreds of millions of dollars in aid to a succession of brutal dictators who used the cash to pay and equip police forces and military units that ruthlessly maintained “stability” by repressing their own people. Abdullah Saleh was a faithful ally of our “war on terror,” but when popular rage unseated him in 2011, the US promptly branded him an incompetent stabilizer, and began firehosing cash to his equally brutal successor, Abd-Rabbu Mansour Hadi. Who is now trying to govern from the southern seaport of Aden, having been run out of the capital city by the Houthis.

The United States has spent hundreds of millions — probably billions — of dollars supporting the government and striking at Al Qaeda in Yemen, whose accomplishments outside of Yemen, where we live, are two in number: the attack on the French magazine Charlie Hebdo and the failed operation of the pathetic underwear bomber. They are credited with “inspiring” the inept Boston Marathon pressure-cooker bombers, and a deranged soldier who shot 13 people in Fort Hood, Texas. In the same sense, one supposes, you could explain Jeffrey Dahmer’s cannibalistic crimes by saying he was inspired by Julia Child.

Time for a reality check. [Thanks to the one person — Nafeez Ahmed — writing in the Middle East Eye — on whom we can rely for consistently straight talk.]

  • The reason we are interested in Yemen is the same reason we are interested in the downtrodden and the underprivileged everywhere: they live where our oil is.
  • Yemen started to come apart in 2001 because that’s the year it experienced peak oil. It pumped 450,000 barrels a day back then, last year 100,000 barrels a day and in about two years — 0 barrels a day. Since oil was and is the country’s only significant source of income, this is a big problem. (So why are we still interested in them? Because their disintegration is endangering Saudi Arabia, who still has lots of our oil, that’s why.)
  • Things have gone from bad to worse as a result of climate change. Never a rainforest country — it’s Arabia, after all — Yemen used to be able to count on having about 37,000 gallons of clean water per person per year. As the aridity of the whole country has inexorably increased, the average amount of water per capita has dropped to 22,000 gallons a year. (That would keep a typical American household going for 73 days.)
  • As life in Yemen has become harder, it has become much more expensive. Oil income used to subsidize the cost of fuel and electricity to ordinary people. No more. As a result, the price of everything whose production requires energy or water — food, for example —  has skyrocketed. So has the unemployment rate, now at about 40% for all adults, 60% for young people.

Leaders who try to deal with problems such as these with tanks, tear gas and automatic weapons will soon find themselves experiencing the business ends of pitchforks. Countries that try to help them with cash, waterboards and drone strikes will soon find themselves up to their eyeballs in a quagmire. People who describe the agony of countries such as Yemen as having an Arab Spring, or indulging in a passion for freedom, will be given a special, long-term assignment in the Orwellian Language Department of Hell.

So, please. Don’t drink the Yemenade.

 

***

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

The World’s Most Sustainable Country: What? Cuba?

From the keyboard of Thomas Lewis
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 By 2006, when this picture was taken, urban farms such as this converted soccer field in the middle of Havana were supplying the city with 90% of its produce while using virtually no petroleum products. (Photo by Dave Williams/Flickr)
By 2006, when this picture was taken, urban farms such as this converted soccer field in the middle of Havana were supplying the city with 90% of its produce while using virtually no petroleum products. (Photo by Dave Williams/Flickr)

First published at The Daily Impact  February 9, 2014

After 50 years of pretending that Cuba is not there, the United States government this year admitted that, well, it is still there (even  Fidel Castro is still there) and we may as well deal with it. This is seen in some quarters as progress. But it is widely assumed that American business will swoop in there and upgrade them from their 1967 DeSoto cars, re-mechanize their agriculture, build fast-food restaurants, and stamp out Communism. It’s what we do.

What we should do is recognize that Cuba confronted in 1991 precisely the kind of Apocalypse that looms before us today — the sudden loss of external inputs to the economy — things such as oil, heavy equipment, cars, and did we mention oil? — and handled it. We have more to learn from them than there is likely time to learn before we are in the soup, but we should do the best we can, because there is no better example in the world for meeting and besting such a crisis.

The World Wildlife Fund in its 2006 Sustainability Index Report cited Cuba as the only sustainable country in the world.

To comprehend the magnitude of that achievement, and its significance for our world today, we need to go back to 1990. Cuba then was the very model of industrial agriculture, turning most of its land over to vast monocultures of sugar cane, applying oceans of imported oil to till it, spray it (Cuba at the time used more pesticides than the United States), harvest it and ship it to the Soviet Union in return for oil and food. Most of what was grown in Cuba was exported; most of what was eaten in Cuba was imported. When the Soviet Union collapsed in 1991, Cuba, under embargo by the United States, had no market for its agricultural products and no way to pay for imported oil or food.

An industrial country wakes up one morning to no more oil. Just like that.

Motivated now by survival, not by profit, Cubans did what smart people have been telling us all to do for decades now. They stopped wresting cash from their punished land and started to heal it in order to have enough food to live. It was tough, starting from scratch, with the crisis already upon them. In the decade that followed the average Cuban adult lost 20 pounds.

They brought in experts in Permaculture from Australia and launched a national drive toward diversified, organic, polycultural, restorative agriculture. They did not do this because they wanted to save “the environment,” they did it because they wanted to save themselves. And that is why they succeeded. By the end of that first decade the average Cuban was getting 2600 calories and more than 68 grams of protein, an amount considered “sufficient” by the United Nations Food and Agriculture Organization. By 2006 average caloric intake was up to 3356 calories.

A lot of this food was produced not in the countryside (requiring transport to the cities) but in urban gardens, where food was grown and consumed in the same neighborhood. By 2002, 35,000 acres of urban gardens produced 3.4 million tons of food. In Havana, 90% of the city’s fresh produce came from local urban farms and gardens, all organic. In 2003, more than 200,000 Cubans were employed in urban agriculture. In 2003, Cuba had reduced its use of Diesel fuel by more than 50%, synthetic fertilizers by 90%, and chemical insecticides by 83%.

Cuba’s achievements, in the face of exactly the kind of test we will soon face, are nothing short of awe-inspiring. Our obvious course, now that we are resuming a normal relationship, would be to commend them on what they have done and to invite teachers and consultants to come here to America and show our farmers how to stop destroying the earth and start feeding our people sustainably.

So that’s what we’re going to do, right?

Right?

 

***

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Peak Food is Here. Peak People Next.

From the keyboard of Thomas Lewis
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If we could get photosynthesis to run by moonlight, we would have a chance of supporting the “projected” increase in world population, which as we all know will continue to increase forever, no matter what. Wait, what? (Photo by Sammydavisdog/Flickr)

If we could get photosynthesis to run by moonlight, we would have a chance of supporting the “projected” increase in world population, which as we all know will continue to increase forever, no matter what. Wait, what? (Photo by Sammydavisdog/Flickr)

First published at The Daily Impact  February 3, 2014

When an organism never stops growing, reason calls it “cancer.” When an organism stops growing upon reaching maturity, reason says it has reached its peak. In nature, this is good and normal, as is the following eventual decline and death. In industrialism, peak is a dirty word, to be denied, preferably never even discussed, along with such alien concepts as decline and  death.

Yet even the richest and most powerful humans cannot defy nature for long. She is implacable, and her ruling is that every system, every organism, every enterprise, matures — which is to say it reaches its peak — and then begins to die. This is true for everything from starfish to stars. So it’s time to be surprised all over again at a new study that shows that global industrial food production has, um, matured. As in, peaked.

The study, published in the journal Ecology and Society, investigated the notion that the concept of peak oil — the time when the development of a resource stops growing, plateaus, and then begins to decline — applies to other resources we need in order to to live. The results were stunning. Not only does the growth of all industrial exploitation of resources reach a maximum (followed by inevitable decline), but virtually all the resources that supply us with food have already done so.

Clarifying note: “Peak” something, as in oil, is commonly understood to be the point at which production levels off, the plateau preceding the decline. Here it is used somewhat differently, to mean the period of time in which the production of the resource was growing at its fastest rate. Therefore, in the years following the peak, the resource might still increase year-to-year, but by ever smaller amounts until decline sets in.

Thus when this study says the world reached peak corn in 1985, peak rice in 1988, peak milk and peak wheat in 2004, peak chicken in 2006 and peak soy in 2009, it means that since those years the production of the commodity has been growing more slowly, and is not keeping up with the demand curve of an ever-increasing population. Of the 21 commodities they studied, 16 reached peak production between 1988 and 2008, a breathtakingly short period of time. It suggests, rather than spot shortages and isolated crises, that the world’s food-production system is being overwhelmed.

There is ever increasing evidence that this is so. Yet we continue to see, everywhere, the feckless sentence: world population is expected to reach nine billion by 2050. Because growth goes on, no matter what. But to do that, food production would have to double. That of course would require more fertile land to till, more water for irrigation, more fuel for cultivation, more fertilizer…and all of those things have peaked. It would also bring more pollution, more topsoil loss, more toxicity and more genetic mutilation.

And so we sail on toward the place where constricted supplies meet a heedlessly growing population and the necessary corrections are made by famine and war. There’s another way to say that we refused to recognize the natural concept of reaching our peak: we never grew up.

 

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Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

The Consumer Economy Becomes Consumptive

From the keyboard of Thomas Lewis
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The Randall Park Mall in Ohio was once the world’s largest, with two million square feet. It has ben rotting down since 2009. (Photo by Nicholas Eckhart/Flickr)

The Randall Park Mall in Ohio was once the world’s largest, with two million square feet. It has ben rotting down since 2009. (Photo by Nicholas Eckhart/Flickr)

First published at The Daily Impact  January 28, 2015

 

The Masters of the Universe like to talk about our “consumer economy,” as if we have discovered the equivalent of the perpetual motion machine: an economy that can prosper while consuming, without having to produce anything except fast food and loan documents. Such an economy has the future of a snake that has swallowed its own tail — that full feeling is not going to last. Such an economy is not a “consumer” economy — that is almost an oxymoron — but a consumptive economy, which is to say one suffering from a wasting disease.

People trapped in a burning building don’t spend much time worrying about whether they have a wasting disease. So it’s understandable that with the American oil revolution imploding and the stock market reeling drunkenly along the edge of a cliff, not much attention is being paid to the spreading dry rot of ordinary American retail business. Still, it’s there.

Familiar brands, friendly to and beloved of the American middle class, are going the way of — well, the way of the American middle class: Sears. J.C. Penney, Kohls, Radio Shack, Target,  and many more — are announcing store closings and layoffs on a regular basis. Sears, perhaps the most iconic, lost $300 million last year and is accelerating its store closings, with 235 now on the chopping block. Masters of the Universe immediately brightened to bullish on Sears because of all the real estate the company now has for sale (remember the thing about the snake, and the full feeling not lasting? Or the guy who is burning the siding from his house in his fireplace to stay warm?).

This wasting disease does not affect only the elderly. Preppy young things such as Wet Seal (teen clothes – bankrupt, 338 stores dark, 3,700 laid off), C. Wonder (preppy stuff, gone, 11 stores), and Aeropostale (75 stores closed, 75 more doomed) are sinking to their knees. Target — okay, more middle-aged than preppy, now — just closed all 133 stores in Canada and laid off 17,000 people. (For a list of all the US stores whose closings in 2015 have so far been announced, go here.)

In addition, the country is becoming littered with closed and rotting shopping centers — abandoned cathedrals of the Consumer Church of America. Once the acme of civilized middle class life, the cultural center-of-mass for two generations, malls are creatures of suburbia, and proliferated with it after World War II. Once built at a rate of 100 per week, there hasn’t been a major new one built in America since 2006. Those that remain have become increasingly irrelevant — and insolvent.

Veteran retail consultant Howard Davidowitz expects as many as half of America’s 1,000 or so malls to fail within 15 to 20 years. He predicts that only the 400 upscale shopping centers with anchors like Saks Fifth Avenue and Neiman Marcus will survive. But midmarket malls, he says, are “going, going, gone.”

What is the reason for what is becoming a mass extinction? Did Internet online sales strike like an asteroid and suck all the oxygen out of big box stores? Well, the Internet accounts for about 13% of retail sales now, hardly a crippling blow. Is it, then, a mass migration of people from the suburbs to the center cities, leaving the malls stranded in a depopulated wasteland? Hardly. A sudden, massive change in tastes? No, that’s not it.

Consultant Davidowitz knows the answer. “This isn’t rocket science,”  he says. “What’s going on is the customers don’t have the fucking money.”

Oh.

 

***

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

The Crash of 2015: Day 22

From the keyboard of Thomas Lewis
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Hold on a second, we’ve changed our minds. Can you just hold it right there, please? We’ve decided we like it the way it is…..

Hold on a second, we’ve changed our minds. Can you just hold it right there, please? We’ve decided we like it the way it is…..

First published at The Daily Impact  January 21, 2015

The economy of the United States and the world is on fire, and with the flames and smoke visible in any direction one cared to look, the President of the United States declared last night that the worst is over, “the shadow of crisis has passed,” and happy days are here again. In reality (a state that presidents and candidates for president never seem to visit) 2015 is shaping up to be one of the worst any of us have ever seen.

It’s a potent mix of flammable situations, from an unhinged stock market to a drought-ravaged West to the fiscal convulsions of China, Russia and Europe. But for us in America, the collapse of the bogus New American Oil Revolution is the fire that’s burning hottest and spreading fastest. This is how it’s likely to go:

 First, drill rigs are being shut down and workers laid off, especially in the fracking plays; as unemployment rises and income declines, production will start to fall; as fracking-company stock prices tank, their junk bonds will become worthless and their leveraged loans will go into default, their money sources will dry up and fracking production will virtually halt; as similar problems beset the legacy oil business world wide, the entire edifice of energy junk bonds, derivatives, hedges, credit default swaps and rabbits’ feet will collapse and the stock market will crash. Welcome to The Great Recession: the Sequel.

 So, how are the frackers doing on Day 21?

 1. Laying down rigs, shedding people.

 2. Production Reduction

 Those who are pumping oil have to keep pumping oil as long as they can. Simply stopping production and waiting for prices to rise is not an option because they are deeply in debt and mired in contract obligations. They may be only running in place, but if they stop running they vanish. So we won’t be seeing actual drops in production for a few months. But here’s how we know they’re coming.

 The Bakken play in North Dakota is about 40% of the “new American oil revolution.” Its production has gone from 500 barrels per day in 2008 to just over a million barrels a day. They had to drill 6,000 wells to do that. The Achilles Heel of the fracking revolution is the hideous decline rate of fracked wells: production declines by about 90% in just three years. So if they drilled another 6,000 wells in the next three years (at an average cost per well of $8-$10 million) all they would do is keep production at a million barrels a day. And that’s assuming they found as many “sweet spots” in the next four years as they did in the last. And you can’t assume that. It’s also assuming they can find the cheap money — the junk bonds and junk stock and junk loans — that financed the first 6,000. And you can’t assume that.

To put it another way, if no new wells were drilled in the Bakken in 2015, by the end of the year its production would be about 550,000 barrels a day, or one half its current production.

3. To follow the money, you have to find it.

 It was possible to satisfy the enormous appetite of the fracking industry for cash (see “decline rate”) as long as oil prices were high, money was cheap, and the Masters of the Universe were delirious about America achieving “energy independence” and becoming “number one in oil” again. The Masters are still delirious, but nothing else is true.

 In the past, the oil companies either sold stock, issued bonds, or took out loans to stay on the drilling treadmill. How’s that working out for them? The Bloomberg index of North American oil producers finds that since last June, their value has declined by over half and their debt has increased by 85% — hardly a sustainable trajectory. Going public, up until last year a sure-fire way to cash in big and finance whatever the hell you wanted to do, is simply not an option in 2015. Not for anybody in the fracking oil business.

 As for debt, interest rates on junk-rated energy bonds are over 10%, double what they were last June. Previously issued bonds are trading on the secondary market for dimes on the dollar. And more than 20 US exploration and production companies have used 60 per cent of their credit lines,according to Bloomberg.

 A financial situation for frackers that could best be described as sour now will turn completely rancid in April (at the latest). That is the month that lenders conduct one of two annual reviews of the collateral they are holding for their lines of credit. Typically, the frackers turn to lenders only after exhausting the possibilities of issuing stock and junk bonds, so by the time they get to banks they need what are politely referred to as leveraged loans, or loans to a company that has all its assets locked up and is hemorrhaging cash. When the bankers review the cinders of the assets they accepted as “security,” there are going to be some cardiac arrests.

At that point the Crash of 2015, if it hasn’t already, will metastasize.

[UPDATE: DAY 22]

According to a story in Bloomberg News, which is not exactly one of your fringe Doomer news sources, not only oilfield service providers but oil drilling companies themselves are going to “begin to die” in the second quarter of 2015 as bigger and bigger dominoes fall toward a crash. The January 22 story begins:

Oil drillers will begin collapsing under the weight of lower crude prices during the second quarter and energy explorers who employ them will shortly follow, according to Conway Mackenzie Inc., the largest U.S. restructuring firm.

Read it and weep, here.

 

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Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

A Way Back to Eden

From the keyboard of Thomas Lewis
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The bounty of Permaculture: Could it be the source of life after the death of the industrial age? (Photo by hardworkinghippy/Flickr)

The bounty of Permaculture: Could it be the source of life after the death of the industrial age? (Photo by hardworkinghippy/Flickr)

First published at The Daily Impact  January 20, 2015

The second story the Bible tells us, right after recounting how God created Heaven and Earth, and set humans up in a bountiful garden, is the story of how we got kicked out of the garden. Historians believe that the story of the Fall has been told for 10,000 years, which is about how long we’ve had agriculture. (Coincidence? I don’t think so.) For ten millennia we have lamented the exchange of a life of ease and plenty for our hardscrabble existence marked by loss and pain.

When I contemplate the coming crash of the Industrial Age, when I visualize its massive wreckage, I have come to believe that I can see, in all the smoke and horror, a path leading back to the Garden that was once our birthright, and could be again.

After all the time we have been telling each other this story, you’d think we’d have a pretty good grasp of its contents, if not its larger meaning. But we mostly seem to think it has something to do with disobedience, or eating an apple, or associating with serpents, or something. But the Bible is quite clear: we were booted for arrogance — for claiming for ourselves the “knowledge of good and evil.” (My layman’s close reading of the story in Genesis is the prologue of my book Brace for Impact.)

When we presumed to know the difference between good plants (crops) and evil plants (weeds), between helpful animals (domesticate them!) and evil animals (eradicate them!), between bees (build hives for them! On 18-wheelers! Truck them all over the country and make tons of money!) and mosquitoes (eradicate them!), we lost our residency in the Garden and began a centuries-long war with Creation, a violent and destructive struggle to bend it to our purposes. It’s a war we are now in the last stages of losing decisively.

We got kicked out of Eden, God said to a friend (or somebody — the quote in Genesis is intriguing) lest we lay hands on the Tree of Life itself. By which I take Him to mean lest we, no longer content with the physical destruction we have wrought, start tinkering around with the ultimate mystery, our genetic code.

I have always assumed that the story of the Garden and our Fall was metaphorical, meant to be instructive and not understood as a literal description of two incompatible approaches to living on Earth. Now I am not so sure.

I have become a novitiate in the study and practice of Permaculture — restorative agriculture whose goal is to grow abundant food by nurturing the web of life, instead of destroying it as industrial agriculture does. Permaculture teaches us to contemplate our fields for a long time, before intervening gently and helpfully to husband their water, replenish their soils, assemble their plants into guilds of mutually beneficial species from subsoil fungi to lofty oak trees. One of the results of this behavior is the emergence of a food forest, a source of an abundance of fruits, nuts, berries, vegetables, herbs and mushrooms that requires no chemical fertilizers or pesticides, no petroleum-fueled tillage, no irrigation, little labor for its maintenance, and that flourishes for decades if not centuries.

Sounds like Eden to me.

Permaculture, as I am just beginning to understand it, is sustainable agriculture raised to a new level and extended into every aspect of life. For example, one of the requirements of its practice, one that is so alien to the attitude of the industrial age as to be almost incomprehensible to us, is the commitment required to a piece of land. It is a commitment not of years but of generations, not by an individual but an entire family at least, a whole community at most.

People are doing this now. People born captives of an iron industrial age, taught to exploit, destroy and move on, mercenary nomads conditioned to expect immediate gratification, are learning how to nurture slow abundance not only in beautiful and hospitable places but in desert places, in depleted and injured and tainted places. And they are finding that as the land in their care heals, so do they and their families and their associations.

In a real sense they are going back to Eden. Maybe it’s possible, while the destroyers reap the whirlwind of their destruction, to create the beginnings of a new world from which the curse of our presumption — to know the difference between good and evil, as if we were gods — has been lifted.

For me, the possibility is enough to keep me from despair, and to make me want to live long enough to see the other side of the coming cataclysm. I’d like to give my forwarding address as: a state of grace.

 

***

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Living the American Dream is a Nightmare

From the keyboard of Thomas Lewis
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In Plato’s little-recognized prediction of the Age of Television, slaves chained to their couches watch reflections of events, while philosophers struggle up to the sunlight to see what’s really going on.

In Plato’s little-recognized prediction of the Age of Television, slaves chained to their couches watch reflections of events, while philosophers struggle up to the sunlight to see what’s really going on.

First published at The Daily Impact  January 12, 2014

 

Plato asked us to imagine a group of people chained to a wall in a cave in such a way that they could not see what was going on around them, only reflections cast on the cave wall opposite them by firelight. He invited us to consider how skewed the prisoners’ understanding of the world would become over time, and to value the contributions of philosophers who go out into the sunlight and see things as they really are. It’s easy for us Americans of 2015 to grasp the first part of his allegory, because it’s a perfect description of us watching TV (remarkable that he nailed that prediction 2,000 years ago, don’t you think?). It’s the second part that mystifies: what would a philosopher, stumbling out of the cave of shadows on the wall, make of our realities?

The shadows on the cave wall are dancing in eternal, unrelieved, twitching ecstasy: gas prices are down, the government-calculated unemployment rate is down, job creation is up, the stock market is setting altitude records, and because of the happiness of the shadows on the wall, the prisoners chained to the wall are feeling better about their futures than ever.

So, prisoners. What’s really out there? The philosopher has returned from a brief sojourn, wherein he found that the American Dream has become a nightmare.

  • The Bureau of Labor Statistics — the agency responsible for the “good news” that America has created 605,000 low-paying jobs in the last two months, reported at the same time that the total number of American employed was in December only 182,000 more than the October total. So where are the other 423,000 jobs that were “created?” Shadows on the wall.
  • Also note that in December alone, 451,000 people left the labor market — they joined the 93 million adult Americans who have given up and stopped looking for work (and thus are not counted when the “unemployment rate” is calculated). Quick, another chorus of “Happy Days are Here Again.”
  • Since the last time America was doing okay, 2007, we have added 16 million people to our adult population, and we have subtracted 2 million full-time jobs. Thus we have a situation that (to hear the shadows on the wall tell it) has improved every year for seven years but is now worse than it was seven years ago.
  • Two recent surveys have found that well over half of adult Americans have no savings – none — and do not have enough cash in their possession to cover a sudden expense ($400 in one survey, $1,000 in the other).
  • In contrast to the shadow land where there is no inflation , the philosopher finds that real Americans are struggling with an inflation rate for food of more that 20%. Ground beef has just hit a national average price of $3.88 per pound, an all-time record high. But food prices are not included in the government’s calculation of the rate of inflation. More than 50 million American households — not people,  households full of people – last year experienced what is politely referred to as “food insecurity”. That’s the term the shadows use, out in the sunlight we call it “hunger.”
  • 46 million Americans are on food stamps, 20 million more than were enrolled in 2007, before the Great Recession started. And in nearly three-quarters of large American cities, requests for emergency food aid were up sharply in 2014 and are expected to skyrocket in 2015.

So out here in the sunlight, we see rising hunger, poverty, unemployment, sea levels, desertification and collapsing energy and stock markets. Who can blame us for preferring the cave, where at least somebody sees to it that the fire is kept burning?

 

***

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

The Crash of 2015: Day 9

From the keyboard of Thomas Lewis
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You have this perfectly good structure, and then you kick out a few of the supporting pillars, and the next thing you know the SEC is on the phone.

You have this perfectly good structure, and then you kick out a few of the supporting pillars, and the next thing you know the SEC is on the phone.

First published at The Daily Impact  January 9, 2015

 

With oil prices at about half what they were six months ago, the most vulnerable players in the oil business, the frackers who brought about the new American Oil Revolution, are imploding. If you think that’s just their end of the boat sinking, no worries here, think again. They are, or were, the last best hope of continuing the oil bonanza, and they’re done. As soon as that fact is so obvious that even Faux News has to admit it (this may take a few months), it will dawn on us all that the very same thing is happening to the deep water drillers, the Arctic drillers and the tar sands wringers.

It would have happened at any oil price. The slump has merely brought it on sooner, and will force us to face — this year! — the reality that we will never again have quite enough cheap oil. That’s the meaning of the Crash of 2015. Now, about the schedule: Here’s what’s happened, what’s happening and what’s about to happen.

Old News (Since January 1)

WBH Energy files for bankruptcy protection. American Eagle Energy suspends all drilling  operations. US Steel to close two plants making steel pipe for oil drillers, laying off 750. Dallas Federal Reserve Bank sees job losses of 250,000 in eight states.

New News (Last couple of days)

Resolute Energy, operating in Texas, Utah and Wyoming, has just borrowed $150 million from the “alternative” investment group Highbridge Capital at an effective interest rate (after fees, guarantees and other legerdemain) of as much as 25%. That is not a typo – twenty five per cent interest. It  would be bad enough if Resolute had to borrow to keep on drilling, but this loan was taken for the sole purpose of avoiding default on previous debt (which, if negotiated more than six months ago in the prevailing market, probably cost around six per cent).

Sanchez Energy, after having announced a reduction in its capital spending plans in November, announced a second cut that brings its capital budget down to half what it was expected to be. This was one of several such announcements from around the world as the oil companies try to preserve cash by not spending as much on developing new wells.

Laricina Energy, operating in the Canadian tar sands with $1.3 billion in equity financing (from stock sales) and $150 million in four-year notes,is in default on the notes and needs another $350 million to do what it’s doing. Next step: probably liquidation.

News About to Happen

Any notion that this is all a temporary supply/demand correction in the oil business, and only the oil business, of a kind that we’ve seen many times before and that will right itself shortly, can most kindly be described as delusional. Here’s why.

These operators cannot simply shut down their wells and sit on their hands waiting for prices to go back up, because they are up to their eyeballs in debt, much of which has to be rolled over every few months, or they go out of existence. That is why they will pump oil until they are carried off in nets, because that’s the only way they can get any money. (That also explains why Saudi Arabia will not cut production to boost prices; that would cost the Saudis more than selling at low prices.)

The total amount of debt being carried by the fracking industry right now is double the amount of debt that was involved in subprime mortgages in 2008. The discovery that the 2008 debt was based on fictional assets and nonexistent ability to pay brought the economy of the world to its knees. If you believe that the current bubble will not do the same thing when the cost of credit triples (see Resolute Energy, above), the underlying assets vaporize (for example, the future value of a deposit of oil that cannot be recovered at a profit), taking with them into the ether the imaginary money that has been propping the whole industry up — if you believe the results will not be similar, I have some junk bonds to sell you.

Much of the money used to buy the junk bonds and provide the leveraged loans (meaning loans that no one in their right mind would ever grant given the security offered and the demonstrated ability to repay) has itself been borrowed. When the bottom floor of this house of cards collapses, it is not going to leave untouched the top floors. Imaginary money can buy stuff only when it is in motion. When the music stops, you discover that there aren’t any chairs to find safety in. None.

 

***

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

The Worst News Story of 2015

From the keyboard of Thomas Lewis
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And the (early) award for the worst news story — not the worst story, the worst news — of 2015 goes to……

And the (early) award for the worst news story — not the worst story, the worst news — of 2015 goes to……

First published at The Daily Impact  January 4, 2015

What? Too soon? Maybe not.

This story had precursors in 2014, just a few hints about what it could become. In the spring, a courageous BBC journalist smuggled out pictures and reports of a three-year-old uprising where no uprising can be permitted. Shortly afterward the host country sentenced to death two leaders of the uprising (presumably by the country’s favored method of public beheading followed by crucifixion). Whereupon the uprising managed a murderous bombing attack. In the Middle East they have a name for this: Tuesday.

These events did not take on the gravitas of portents because they took place in the Middle East, but because they took place in Saudi Arabia. There they posed a threat not merely to another brutal Arab dictatorship, but to the entire industrial world, which cannot function without Saudi oil. Such power over the richest countries of the world might seem enviable, but it is, as they say, no bed of roses. Crude oil is selling for about half what it did six months ago, and oil is the kingdom’s only source of income. Their budget for the coming year posits the largest deficit in its history.

The Saudis are not going to run out of money anytime soon, but strains are mounting in every direction. Its population is becoming larger and more affluent, thanks to the lavish spending of oil money, and likes its air conditioning, cars, and 30-cent-a-liter gas. So much so that it is consuming an ever larger share of the country’s oil output, which has not increased significantly since 2005. I am talking here about crude oil, taken from the ground, not the recently fabricated definition of “petroleum liquids” that makes it appear that “production” is still increasing.

So this country, buffeted by market forces, trying desperately to stamp out an insurgency in the heart of its oil-rich Eastern Province, gets the news on Wednesday that King Abdullah, 90, who has terminal lung cancer, was admitted to hospital with pneumonia and was put on a ventilator to keep him breathing. Five per cent of the value of the Saudi stock exchange vaporized. But we are assured that the succession has been arranged, all will be well, nothing can possibly go wrongwrongwrogngarn. It is simply not conceivable that the descendants, in-laws, extended family and close personal friends of (the first Saudi monarch) Ibn Saud’s 45 sons, presented with an opportunity to seize unimaginable wealth and power, will do anything other than behave.

These precursor stories probably do not qualify for the most ominous of 2014. But if the story they are pre-cursing, that is the descent of Saudi Arabia into an Arab Spring maelstrom, should become a story in 2015 then it will win the year for bad news, hands down. May as well hand over the statuette right now.

 

***

 

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Attention in the Crowded Theater: Fire!

From the keyboard of Thomas Lewis
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Firefighters try to snuff an oil well fire in Iraq in 2003. What is happening to the oil business today, especially in the United States, is akin to a thousand such fires.

Firefighters try to snuff an oil well fire in Iraq in 2003. What is happening to the oil business today, especially in the United States, is akin to a thousand such fires.

First published at The Daily Impact  January 7, 2015

The flames of the next financial crash are leaping up everywhere you look (if you look without wearing the rose-colored glasses): in the Bakken fracking fields of North Dakota, the Eagle Ford in Texas, the tar sands of Alberta, the deep waters of the Gulf of Mexico. They are lighting up the night sky in all directions, and in the daytime the smoke is sickening the light and smelling up the air in the skyscraper offices of the Masters of the Universe where they shuffle decks of junk bonds, subprime loans and derivatives. Along with the smoke, you can smell the fear. This is going to be bad.

Serious testimony in a minute, but first an odd moment of clarity that I caught by accident yesterday on CNBC during its “Closing Bell” program. One of the female anchors was interviewing an analyst sent over from Central Casting to opine on oil prices. How low could they go, she asked him, somebody was predicting $20 a barrel? “Well,” oozed the analyst, “the models don’t support $20 a barrel.” Which is when the anchor person lost it (I was caught off guard, and am reconstructing this from memory, so consider it a paraphrase).

“You know what?” She said. “This conversation is driving me crazy. What do you mean the models don’t support $20? The models didn’t see any of this coming. None of them predicted any of this. Nobody saw any of it coming. Doesn’t anybody have any idea what is going on?”  

I wonder if we will see her face again, now that she has committed the worst sin a journalist can commit on air — blurting out the truth.

With respect to the narrow question of why oil prices collapsed in June, no one has a clue. One of the analysts on that very CNBC panel said as much, averring that the fundamentals of supply and demand do not explain the price movement. The best estimate of the current world surplus of crude oil over demand is two per cent. Two. On what planet does an oversupply of two percent for a machine burning 90 million barrels a day lead to a 50% drop in prices?

As to the larger question of what is happening to the oil industry and everything related to it — and everything is related to it — lots of people know what is going on but they can’t go on television with their hair on fire. It’s not considered audience-friendly. But let’s review what they know:

  • The number of US oil rigs actively looking for or extracting oil is dropping fast. A report out Monday from oil field services company Baker Hughes showed the number of rigs operating in the United States declined for the fourth consecutive week — by 29 in the latest count, to 1,811. That, combined with last week’s decline of 35, marked the largest two-week drop in the U.S. rig count since 2009. (Ahem: you remember what else was going on in 2009?)
  • Layoffs are rising of stunned workers who thought they were in a bonanza that would last for years. For weeks now, many players in the fracking patch have been announcing that nothing is wrong but that as precautions they are laying down rigs and reducing exploration budgets and cutting production forecasts. So far just one company, American Eagle Energy, has suspended drilling entirelyuntil oil prices rebound. There will be more, directly.
  • Collateral damage is spreading to oil-patch service providers: Civeo, a Houston-based company that builds lodging for oil workers,announced on December 29 that it would cut its workforce by 45 percent because of lower demand for “man camp” trailers. U.S. Steel has just announced the shuttering of two plants in Texas and Ohio that make oil drilling equipment and that employ 750 people. In Williston, North Dakota “The Bakken Club,” which offered exclusive services to oil-patch players including fine dining, airport shuttling, and corporate events, has been closed because it can’t pay its rent.The Federal Reserve Bank of Dallas, estimates that 250,000 jobs could be lost in 2015 if oil prices don’t rise.

 The “Don’t Worry Be Happy” chorale  has a new verse, about how it takes a year for plans to reduce output to show up as reduced output, so maybe prices will recover first and hesto presto, no pain! That was true when the average productive life of an oil well was on the order of 20 years, but the productive life of a fracking well is about three years. This, as they say, changes things.  Wells playing out in the Bakken in November, for example, subtracted 60,000 barrels per day from the field’s production. In November, that was more than made up for by new wells coming on line. In January, after God-knows-how-many more rigs have been idled, 77,000 barrels per day will be lost. Get the picture?

Not yet? Then look at this picture. Geological consultant and shale-oil expert Arthur Berman explained to Oilprice.com that the chorale’s other verse, about frackers breaking even at the new low price, because of their new technologies, makes no sense:

“Continental Resources is the biggest player in the Bakken. Their free cash flow—cash from operating activities minus capital expenditures—was -$1.1 billion in the third- quarter of 2014. That means that they spent more than $1 billion more than they made. Their debt was 120% of equity. That means that if they sold everything they own, they couldn’t pay off all their debt. That was at $93 oil prices. And they say that they will be fine at $60 oil prices? Are you kidding?”

But wait, there’s more. If you call right now, we’ll give you the latest increases in junk bond and leveraged-loan rates, which are driving up driller’s expenses as fast as their revenues are shrinking. And the latest quotes for the tanking share prices of just about any company having anything to do with oil. Oh, and the even-worse-case scenario in the Canadian tar sands.

You might have to let the phone ring for a while. I’ll be in the bunker, putting out my hair.

***

Thomas Lewis is a nationally recognized and reviewed author of six books, a broadcaster, public speaker and advocate of sustainable living. He also is Editor of The Daily Impact website, and former artist-in-residence at Frostburg State University. He has written several books about collapse issues, including Brace for Impact and Tribulation. Learn more about them here.

 

 

Brace for Impact: Interview with Thomas Lewis Part 1

logopodcastOff the microphones of Tom Lewis, Surly, Monsta & RE

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Aired on the Doomstead Diner on January 3, 2015

“Save As Many As You Can”

Discuss this Interview at the Podcast Table inside the Diner

Part 1 of our first Podcast with Tom Lewis discusses Tom’s history in the Journalism and how he came to pretty much the same conclusions we here on the Diner have arrived at, which of course is why we regularly cross post his blogs from The Daily Impact.

For those of you unfamiliar with Tom’s work, here is his Sayonara Post to 2014, including a Bonus Podcast on his website, which you can download there.

RE

Holiday Repost: Farewell to 2014

For what we are about to lose, Dear Lord, we thank You. (Photo by Terren in Virginia/Flickr)

 

[The Daily Impact is on hiatus for the holiday season. For your consideration, I leave you with a repost of a meditation on “The Last Good Year,” and a reminder that in 2015 it would be well to Brace for Impact.]

Thanksgiving is coming, and Christmas and Kwanzaa and Hanukkah and New Year’s, and we should make the best of them. These are the good old days, and we should celebrate them well, because we are probably not going to see their like again. Gas is cheaper than it was, and we should go to see the relatives this year, because next year will be different. Food is a little more expensive than it was, yet we should eat hearty nevertheless, because next year will be different. We still have plenty of water (if we don’t live in California, or Brazil, or North Africa, or any of a multitude of other places being seared by implacable drought) but, because of changing climate and advancing pollution, next year could be different. The lights are still on, but the aging grid is creaking and groaning with the effort of meeting our burgeoning demand, and next year could well be different. Eat, drink, and be merry, for tomorrow we diet.

Predictions are dicey things, and are more often than not fatal to the credibility of the predictor. Premature declarations of the end of this, or the beginning of that, are legion — and legendary. From the Age of Aquarius to the light at the end of the tunnel, from the Rapture to Armageddon, history is lettered with the remains of discredited prophets. Why would anybody willingly step into their ranks?

First because many prophets are not really discredited. The fact that the big San Andreas earthquakes predicted to decimate Los Angeles and San Francisco have not yet happened, does not mean that the forecasters were wrong or that the quakes are now less likely to occur. To the contrary, they become more likely with each passing day of accumulating strain on the fault, and the prophets will be redeemed in the most unfortunate way. Similarly, those who have predicted that increasing population will exceed the carrying capacity of the planet, or that oil demand would exceed supply, are not wrong because they thought it would have happened by now. It is not the date on which a thing does or does not happen that matters; it is the thing itself, and its causes.

Secondly, there is a moral imperative. As I postulated in Brace for Impact, if you see a child playing on a railroad track in the path of an approaching train, you have no choice but to make a choice — between trying to save him and ignoring him. Basic human morality reduces that choice to one acceptable course of action. Unseeing him is not an option. Nor can you avoid the fact that your choice will affect the rest of your life. (Now, our world is full of people who, when they hear you shout, “That child is in danger!” will say in response “Why must you be so negative? Try to be more cheerful about things.” Ignore them. Though it be obscured by clouds of ignorance, the moral imperative is still there, hard as granite.)

So, because I must, here is a short list of the things that are bearing down on us like runaway trains.

  • Financial collapse. There are so many bubbles reaching maturity in the near term — the subprime auto-loan bubble, the overvalued stock bubble, the China real-estate bubble,  the fracking bubble, to name the biggest — that it is likely that this time, more than one of them will burst at once, with far worse effects that when the housing bubble went up all by itself, or the dot-com bubble, alone.
  • Oil Depletion. The biggest con, and the one with the worst side effects, is the proposition that America is at the beginning of an oil renaissance, when it is in fact at the end of the oil age. When the giddy optimism among investors and the general public is blown up, by events likely to occur next year, this will be the unkindest cut of all, and will likely start, or contribute to, a cascade of crashes. When it happens, everything made from oil will return to its former high prices and keep on going up.
  • The Water Problem. 2015 is probably going to see the first climate refugees in significant numbers leaving California’s Central Valley, and possibly parts of Arizona, Texas and Nevada, as well as Sao Paulo, Brazil and parts of China and India. For America, the loss of confidence in technology and a beneficent God implied by the loss of California agriculture to drought will be crushing.
  • The Rotting Infrastructure. Every physical system in America, from highways and bridges to the electric grid to water and sewer systems to dams, ports and airports — even the credit-card system — has seriously exceeded its design life and its design capacity with no provision having been made for its replacement. Like the big earthquake, it is impossible to predict when any one of them will fail, yet impossible to believe that they will not.

What this prophet sees for next year is not yet The End of the World as We Know It, as in the ultimate crash of the industrial age, but another nasty shock as our economic tectonic plates sink jarringly to a lower level from which they will not rise again, as happened in 2007. That may make the final fall, whenever it comes, shorter, but no more pleasant.

So raise a glass, and hold a feast, in honor of 2014. May we always think fondly of the last good year.

Knarf plays the Doomer Blues

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My new book, Abolish Oil Now, will talk about why the climate movement has failed and what we can do [...]

A new climate protest movement out of the UK has taken Europe by storm and made governments sit down [...]

The success of Apollo 11 flipped the American public from skeptics to fans. The climate movement nee [...]

Today's movement to abolish fossil fuels can learn from two different paths that the British an [...]

Top Commentariats

  • Our Finite World
  • Economic Undertow

A minor puzzle. The Valley of the Kings contains at least 63 tombs for Ancient Egyptian royalty. All [...]

But, dear Xabier, that was not the Wehrmacht, is was those dastardly SS! As you may recall, it was t [...]

The Pakistani find has totally failed to materialise, I see: "Pakistan Prime Minister Imran Kha [...]

They should have raised fuel prices a long time ago - and scrapped income taxes and suchlike [...]

As unconvincing as David Cameron's promise of cheap natural gas for Britain produced by frackin [...]

Here's an article: https://www.reuters.com/article/us-imo-shipping-factbox/factbox-imo-2020-a-m [...]

What is the shift away from bunker fuels? [...]

Yeah, when the water heater goes out the day after you just put new tires on one of the cars, etc... [...]

I join the chorus in welcoming you back. Any thoughts on how the shift away from bunker fuel on Janu [...]

@Front Range Mike "Most everyone I know is trying to figure out how to cut back and sell their [...]

RE Economics

Going Cashless

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Simplifying the Final Countdown

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Bond Market Collapse and the Banning of Cash

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Do Central Bankers Recognize there is NO GROWTH?

Discuss this article @ the ECONOMICS TABLE inside the...

Singularity of the Dollar

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Kurrency Kollapse: To Print or Not To Print?

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SWISSIE CAPITULATION!

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Of Heat Sinks & Debt Sinks: A Thermodynamic View of Money

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Merry Doomy Christmas

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Peak Customers: The Final Liquidation Sale

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Collapse Fiction

Useful Links

Technical Journals

The effect of urbanization on microclimatic conditions is known as “urban heat islands”. [...]

Forecasting extreme precipitations is one of the main priorities of hydrology in Latin America and t [...]

The objective of this work is the development of an automated and objective identification scheme of [...]