Global financial system implosion begins

[Nylock]

like the SUV / people carrier monstrosities people with kids seem to "need" these days.

Not everyone with kids 'needs' or 'has' an suv/people carrier. Only a complete dickhead would want or "need" an suv and only someone with a big family would want or "need" a people carrier. Your apparent enmity towards people who have kids seems to be leading you towards conflating elitist dickheads who want a statusmobile with 'people with kids'.

 

[Nylock]

Do some research rather than just reading propaganda. There are several perspectives to this.

Nice assumption there pal. Why not just answer the questions since you are so sure of what you speak?

 

[Frank Merton]

Nice assumption there pal. Why not just answer the questions since you are so sure of what you speak?

Well we are not pals and I did. The End unless you want to discuss rather than assert.

 

[elbows]

Markets deal with scarcity better than rule-making and subsidies/taxes for the reason that they work automatically without needing political support. Create, for example, a subsidy regime to accomplish some worthy goal and before long it gets converted to a subsidy for those with political clout.

The problem is, when there is scarcity, those with need must do without in favor of those with means. Unfortunately trying to correct this unfairness politically -- which may only be a case of those doing without have louder voices -- almost certainly makes the scarcity worse, by both increasing demand and by reducing the incentives for greater efficiency and production.

I think its been a while since we had someone so keen to drool about the virtues of markets round these parts.

Markets can work in some domains to a certain extent, but their efficiency and ability to cope is not automatic and is almost certain to be found wanting in the years to come. Markets are also just as easy to exploit, and are as prone to unfairness, corruption and opportunism as the subsidies you fret about. Indeed we can even engineer artificial markets in order to subsidise certain technologies long before a 'natural' market would exist for them, so its not a straightforward subsidy vs free markets story here, in that case its a way of dressing up a form of planning thats out of fashion so that it gets past the beady eyes of free market fantasists and melds seamlessly with the sort of economics that has been in vogue for decades.

But I wont attempt to convince you of this, rather I will simply suggest that we will see the problems of all these things in the years to come, magnified as never before, and we will also see the backlash when the subsidies which 'unfairly' give the poor access to energy are eroded in a variety of countries. Its already happened in some countries, albeit ones our media dont bother to focus on very much. But we do seem to pay some attention to Egypt so I'll float that one as being one to watch. You can wax lyrical about the joys of markets all day long but if they dont enable circumstances that are conducive to stability and security then bollocks to them, shown to be an artificial structure not fit for purpose, no matter how logical and scientific the theory of markets may be to you. If the efficiency they bring is efficient use of capital for gain by a few then thats not the sort of efficiency humanity needs anyway.

 

[Nylock]

Well we are not pals and I did. The End unless you want to discuss rather than assert.

Quite right, we are not pals, good call

...and no, you did not answer the questions i put to you at all. Nice try though

 

[Dr Jon]

Not everyone with kids 'needs' or 'has' an suv/people carrier. Only a complete dickhead would want or "need" an suv and only someone with a big family would want or "need" a people carrier. Your apparent enmity towards people who have kids seems to be leading you towards conflating elitist dickheads who want a statusmobile with 'people with kids'.

Yeah, probably a gross generalisation due to the fact that the only time I really notice these oversized vehicles is when they're blocking the road dropping kids off at school.
We walked to school or took the bus, ffs.

 

[littlebabyjesus]

Overhanging all this is the threat of global warming. It is interesting that there is such a clear political division on this topic, with the left grabbing onto it as a way to justify government control, and the right rejecting for much the same reason. One must not be influenced by the politics, but by the science.

It does appear that the globe is getting warmer, and it does appear that human activities are behind it. So far the left wins. However, they have launched scare propaganda that has cities being flooded, earthquakes, tornadoes, hurricanes and general apocalypse. Most of this is nonsense. Global warming will produce problems, and will also have benefits. The proposed cures tend to be much worse than the disease.

You need to follow your own advice a bit more carefully. Lots of posters on here are well acquainted with the science behind anthropogenic global warming, its likely effect on the climate, and the effect that changed climate is likely to have for us. I'd be interested if you could present a link to reputable research that talks about the benefits of global warming.

I tend to be on the optimistic side of the arguments over how we are going to deal with global warming, but I would suggest that anyone who isn't rather scared by what is happening hasn't properly understood the problem.

 

[Falcon]

so while the efficiency of producing the fuel is dropping, the efficiency we can use that fuel has and will continue to increase rapidly. Roughly speaking, that efficiency improvement has roughly offset the reduction in EROI for oil extraction since the 70's

Some actual figures. Free spirit is right in one thing: energy efficiency in OECD countries has appeared increased slightly in recent years. But that is attributed to exporting energy intensive economic processes from OECD to non-OECD countries then failing to account for the embodied energy in reimported finished goods.

But here is the real hole in his analysis: OECD countries consumes 4 times more energy per capita than non-OECD countries. So of course we've been able to make some energy efficiency improvements.

But the OECD population is only 17% of world population and is growing at only 0.4% per year. Non-OECD is 83% and growing at 1.0% per annum. (Sources: IEA, EIA, CIA world fact book).

Just bringing the 83% of the world that doesn't enjoy our energy use (read: "standard of living") up to only half of ours would require 1.45% per annum energy growth increase for 2 decades. There is no basis to Free Spirit's assertion that modest energy efficiency improvements observed in OECD countries translates into reduction in global energy demand, even if OECD gains were real.

In fact, we can easily work out how much technological improvement we'd need to achieve in order to maintain zero net energy growth under conditions of rising population growth and affluence. Defining E=Energy demand, P=Population, A=Affluence (GDP/person) and a technology factor T=Energy demand/unit of per capita GDP. Population is increasing 0.9% per annum (source: UN); per capita income growth has been rising at 1.4% per annum (Source: Jackson "Prosperity Without Growth" p.79). Then energy intensity has to fall by (0.9%+1.4%=) 2.3% per annum, effectively halving by 2040. In fact, IEA forecasts it will rise by 0.5% per annum in the same period (in effect they are saying they won't even get to half of our "standard of living").

Free Spirit's tales of energy efficiency are yet another unexamined assumption from the world of scarcity denial that doesn't survive contact with reality.

 

[Falcon]

The problem is, when there is scarcity, those with need must do without in favor of those with means. Unfortunately trying to correct this unfairness politically -- which may only be a case of those doing without have louder voices -- almost certainly makes the scarcity worse, by both increasing demand and by reducing the incentives for greater efficiency and production.

Markets are an elegant mechanism for the allocation of scarce, discretionary goods.

The only equitable, functional allocation mechanism for scarce, compulsory goods - such as energy and food - is rationing.

A political system which took the survival of the state seriously would initiate rationing immediately. Fleming's work on Tradable Energy Quotas (TEQs) is interesting here (ref). TEQ's provide a mechanism for trading (the market) an annually allocated energy quota (fairness) within a national budget (rationing) determined by total available net energy.

But we are too distracted by the false hope offered by technological white elephants to consider such practical solutions.

 

[Frank Merton]

I think its been a while since we had someone so keen to drool about the virtues of markets round these parts.

You rather typically misread me; I am about balance. Keep in mind I am in and support the Socialist Republic of Vietnam.

Markets can work in some domains to a certain extent, but their efficiency and ability to cope is not automatic and is almost certain to be found wanting in the years to come. Markets are also just as easy to exploit, and are as prone to unfairness, corruption and opportunism as the subsidies you fret about. Indeed we can even engineer artificial markets in order to subsidise certain technologies long before a 'natural' market would exist for them, so its not a straightforward subsidy vs free markets story here, in that case its a way of dressing up a form of planning thats out of fashion so that it gets past the beady eyes of free market fantasists and melds seamlessly with the sort of economics that has been in vogue for decades.

Yea -- this sort of thing is easy when market power is not accepted and politicians control them. Markets are not unfettered capitalism, but people free to choose the providers from an array of competing enterprises, none of which is given special status.

But I wont attempt to convince you of this, rather I will simply suggest that we will see the problems of all these things in the years to come, magnified as never before, and we will also see the backlash when the subsidies which 'unfairly' give the poor access to energy are eroded in a variety of countries. Its already happened in some countries, albeit ones our media dont bother to focus on very much. But we do seem to pay some attention to Egypt so I'll float that one as being one to watch. You can wax lyrical about the joys of markets all day long but if they dont enable circumstances that are conducive to stability and security then bollocks to them, shown to be an artificial structure not fit for purpose, no matter how logical and scientific the theory of markets may be to you. If the efficiency they bring is efficient use of capital for gain by a few then thats not the sort of efficiency humanity needs anyway.

You won't persuade me of anything if you only preach and don't respond to my perspective. Egypt is a classical example where the state controlled the markets via subsidies that were inherently corrupt.

 

[Frank Merton]

You need to follow your own advice a bit more carefully. Lots of posters on here are well acquainted with the science behind anthropogenic global warming, its likely effect on the climate, and the effect that changed climate is likely to have for us. I'd be interested if you could present a link to reputable research that talks about the benefits of global warming.

I tend to be on the optimistic side of the arguments over how we are going to deal with global warming, but I would suggest that anyone who isn't rather scared by what is happening hasn't properly understood the problem.

The research is "out there." What we get are people citing sites that support their view.

We each have to do our own research and try to figure it out, keeping in mind all the interests and political ideologies that are shouting for our attention. The best course is to be suspicious of doomsday claims: they are a dead giveaway of people with axes to grind rather than truth seekers.

I fear global warming; there are a lot of things I fear. However, as a general rules the solutions offered (1) won't work, and (2) do more harm than good, especially to developing countries.

 

[Frank Merton]

Yeah, probably a gross generalisation due to the fact that the only time I really notice these oversized vehicles is when they're blocking the road dropping kids off at school.
We walked to school or took the bus, ffs.

I don't own a car. Of course I live in Ho Chi Minh City, where driving a car would be insane.

 

[Falcon]

The best course is to be suspicious of doomsday claims: they are a dead giveaway of people with axes to grind rather than truth seekers.

Unless, of course, the claim happens to be true. In which case, it is the worst course if it causes you to delay your response beyond some threshold triggering or irreversible point.

And, unhappily for your thesis, some of the people with the largest axes to grind (for example, neoconservatives, big oil, motor and aviation coalitions, etc.) are the most suspicious of doomsday claims relating to energy and climate.

 

[Frank Merton]

Unless, of course, the claim happens to be true. In which case, it is the worst course.

Are you asserting doomsday?

And, unhappily for your thesis, some of the people with the largest axes to grind (for example, neoconservatives, big oil, motor and aviation coalitions, etc.) are the most suspicious of doomsday claims relating to energy and climate.

I'm very suspicious and I have nothing to do with those people. I just have some common sense and the ability to recognize politics when I see it.

 

[Falcon]

Are you asserting doomsday?

Yes.

Your attempt to impute political motive is going to be contrived and founded on speculation, not fact.

 

[Frank Merton]

Yes.

That is about the oldest debating tactic in the book. If you think I'm wrong, tell me where and how. Don't make me start denying that this or that is this or that fallacy. All you do when you use that tactic is persuade me you don't really want to discuss the actual issues.

 

[Crispy]

The range of uncertainty in the science of global warming is quite small. The range of politicking and distortion that surrounds it is massive. Falcon, and many other knowledgeable contributers here, consider the science first.

 

[Frank Merton]

The range of uncertainty in the science of global warming is quite small. The range of politicking and distortion that surrounds it is massive. Falcon, and many other knowledgeable contributers here, consider the science first.

Appeal to authority?

Sorry -- I just complained to you about that sort of thing and then I do it. The problem is we have had doomsday predictions from the environmental extremists since I was a kid (and I'm now almost seventy), and they have never proved out. One develops skepticism.

 

[Falcon]

All you do when you use that tactic is persuade me you don't really want to discuss the actual issues.

Whereas the 127 pages of thread which I started and have actively contributed to persuades you of … what, exactly?

And since when has answering a simple question with a simple answer been a "debating tactic"?

 

[Falcon]

Sorry -- I just complained to you about that sort of thing and then I do it. The problem is we have had doomsday predictions from the environmental extremists since I was a kid (and I'm now almost seventy), and they have never proved out. One develops skepticism.

A moment of quiet reflection ought to reveal that a prediction that events will take a different turn in the early 21st century (the position, for example, of the Club of Rome), until the early 21st century, will not "prove out".

I predict that I will die. But it's not been proved out, in my case. Skepticism would be an unwise basis upon which to organise my affairs.

 

[Frank Merton]

A moment of quiet reflection ought to reveal that a prediction that events will take a different turn in the early 21st century, until the early 21st century, will not "prove out".

Oh there was acid rain and the population explosion and the exhaustion of the land and nuclear contamination and the ozone zone and and and . . .. Chicken little is alive and well and making a damn good living.

 

[littlebabyjesus]

The depletion of the ozone layer is a fine example. It was a problem that had a mercifully straightforward solution when it was finally worked out which thing we were doing was causing it. But it was a real problem and it did not solve itself - it needed to be addressed as a problem and resolved through changing our ways. Solving global warming is a whole order of magnitude more difficult, though.

 

[Falcon]

Oh there was acid rain and the population explosion and the exhaustion of the land and nuclear contamination and the ozone zone and and and . . .. Chicken little is alive and well and making a damn good living.

The consequences of a hydrocarbon dependent population and hydrocarbon dependent land exhaustion will not be visible until hydrocarbon depletes. Hydrocarbon is at peak. Therefore the consequences are not visible. But the trajectory of hydrocarbon is.

As adults, we act in accordance with how things will be rather than how things currently are. What would your argument be for reversing that principle in this case?

 

[ymu]

Oh there was acid rain and the population explosion and the exhaustion of the land and nuclear contamination and the ozone zone and and and . . .. Chicken little is alive and well and making a damn good living.

Do you think Y2K was a hoax too, or do you think maybe disaster was averted by people recognising the problem and doing something about it in time?

The ozone layer is why we no longer use CFCs. Acid rain hasn't gone away, although manufacturing techniques reduce its occurrence these days; we export the rest to Asia, along with our smog and manufacturing jobs. Nuclear contamination is mostly being exported to Africa, IIRC.

 

[Frank Merton]

The depletion of the ozone layer is a fine example. It was a problem that had a mercifully straightforward solution when it was finally worked out which thing we were doing was causing it. But it was a real problem and it did not solve itself - it needed to be addressed as a problem and resolved through changing our ways. Solving global warming is a whole order of magnitude more difficult, though.

Actually the ozone depletion is the only one that hasn't been solved, although it is slowly going away.

Let me repeat that I don't doubt that global warming is real and man-caused. The science is clear enough. My problem is the solutions offered and the suffering they will cause -- and that the consequences are seriously exaggerated.

 

[Crispy]

Appeal to authority?

No, to reason and fact. I don't believe others here because they sound authoritative, but because I've come to similar conclusions by reading the actual research.

Climate science is not predicting doomsday, although if you are informed by 2nd or 3rd hand accounts, you may get this impression (or, indeed, the opposite, depending on where you get your information). The science is complex and boring, and the predictions have uncertainty and nuance.

I understand your skepicism, because there have been all sorts of "scare stories" over the years. The format tends to go something like:

Scientist: "I've observed certain behaviours in the atmosphere due to particulates from smoke and volcanoes, which are reflecting heat back into space. If my assumptions are correct, this could lead to an overall cooling effect over the coming decades and centuries"

Press: "SCIENTISTS PREDICT SNOWBALL EARTH"

The science that led to the "global cooling" prediction was not bad science. Increased levels of particulates *do* have a cooling effect on the climate. However, it did not take long for climate science to progress past that conclusion. As more and more data was gathered, and models became more and more comprehensive, the greenhouse effect was found to greatly outweigh the cooling effect.

There have been decades of research now, from all countries, using multiple methods. They all agree, and have had their models confirmed with the real data, that the warming is real and that we're causing it. The sea level is rising, the climate is changing, and unless we make *drastic* changes (rather than the more gradual ones we could have made if we started 30 years ago like we should), then those changes will continue on their present trends. The world is not going to end, but it is going to cause us plenty of problems.

 

[Crispy]

Let me repeat that I don't doubt that global warming is real and man-caused. The science is clear enough. My problem is the solutions offered and the suffering they will cause -- and that the consequences are seriously exaggerated.

Oops, as you were!

 

[Frank Merton]

Do you think Y2K was a hoax too, or do you think maybe disaster was averted by people recognising the problem and doing something about it in time?

The ozone layer is why we no longer use CFCs. Acid rain hasn't gone away; we exported it to Asia, along with our smog and manufacturing jobs. Nuclear contamination is mostly being exported to Africa, IIRC.

Well now you hit a magic button; I was in charge of a roomful of programmers at the time, and we all thought it was a real laugh. I suppose a few shops who weren't aware had some reprogramming to do, but we all knew it was coming and had the appropriate standards in place twenty years before the fact. Nothing happened because it was an invented issue.

 

[ymu]

@Crispy Even when global cooling was trendy, there were more papers on global warming being published.

 

[ymu]

Well now you hit a magic button; I was in charge of a roomful of programmers at the time, and we all thought it was a real laugh. I suppose a few shops who weren't aware had some reprogramming to do, but we all knew it was coming and had the appropriate standards in place twenty years before the fact. Nothing happened because it was an invented issue.

It wasn't an invented issue. There were loads of legacy systems around that had to be dealt with.

Young companies/institutions had less to worry about, of course. Our place was running off software built in the 1970s and a fair bit of it needed replacing.