#88: SEEDS to go live?

MAKING SURPLUS ENERGY DATA AVAILABLE

In recent times, it’s fair to say that three broad themes have dominated discussion here.

The first of these, of course, is surplus energy economics – the philosophy which says that the economy is an energy system, not a financial one. Money may be the map of the territory, but the territory itself is energy.

The second “hot” topic is Ponzi finance. In the early years after the millennium – and for reasons which the surplus energy interpretation can alone explain – real economic growth petered out. Since then we’ve been faking it, spending borrowed money and calling this “growth”. All the while, of course, debt (and informal “quasi-debt”) has escalated. Essentially, the powers that be have been busy destroying the future, not just by accumulating debt but also by crippling other forms of provision for the future, most obviously pension funds and other forms of saving.

Third, the general public has started to smell a rat. I don’t mean that the public understand surplus energy theory, or spend their time comparing growth with borrowing. But the public does have an intuitive sense of when things are going wrong, and this is one of the reasons why they are busy repudiating the “liberal” elites, along with much of what these elites stand for.

The bottom line of these three themes is that policymakers and economists – as some of the latter, to their credit, acknowledge – don’t understand what is happening. To tackle this, we are in urgent need of new economic understanding.

This is urgent, because what the authorities have been doing for a decade and more has been akin to carrying out brain surgery with carpenters’ tools. They can’t fix the economy because they don’t really understand how it works.

And this is where SEEDS comes in. To explain why, I need to digress a bit.

SEEDS

After publishing Perfect Storm (when I was head of research at Tullett Prebon), I embarked on writing what was to become Life After Growth. Throughout that project, I realised that there was a glaring need for a comprehensive mathematical insight into the energy economy. For the book, I was able to include general trends in ECoE (the energy cost of energy), and had data to illustrate, for example, the progression of energy, population and economic output over time. What I did not have, however, was a level of granularity enabling evaluation of individual economies – and the world economy as a whole – with any level of detail.

This was why SEEDS – the Surplus Energy Economics Data System – was developed. Initially, the aim was to estimate ECoEs across fuel sources and economies. At first, SEEDS simply provided estimates of ECoEs on a country-by-country basis over time. The thinking was that, once we had a grasp of ECoEs, we could deduct them from GDP to work out what the “real” economy of goods and services was really doing behind the public facade of recorded output. This has been developed to the point where twenty-one countries are covered by the system – these are the United States, Canada, Mexico, Brazil, France, Germany, Greece, Italy, the Netherlands, Norway, Poland, Portugal, Russia, Spain, the United Kingdom, Australia, China, India, Japan, Saudi Arabia and South Africa.

At the same time, it became apparent that a lot more economic content was required. The “wish list” at this point included debt and borrowing, trade and external flows, government finances, and measures on a per capita basis. Above all, the aim was to get into the dynamics of borrowing and growth, and pull all of these together with the fundamentals of ECoE and surplus energy.

With all of this accomplished and just a few tweaks remaining after several years of effort, the latest version – SEEDS 17 – has become an extremely valuable interpretive tool. To use a motoring analogy, SEEDS has evolved from a Morris Minor into something reasonably akin to Mercedes.

But even the best car achieves nothing whilst it remains in the garage.

Going public?

The next objective, logically, is to make SEEDS generally available.

Broadly, there are two main “audiences” for SEEDS. The first are individuals concerned about what is happening, and keen to further their understanding. The second are professionals, engaged either in making decisions or in providing advice. (There is actually a third category, comprising academics and non-profit organisations, but how to meet their requirements remains to be decided).

This argues for two kinds of product. The current plan is that, for the general public, comprehensive data will be available as PDFs which can be downloaded free of charge. The working name for these is SEEDS Snapshots. For professionals, a more detailed data package (known as SEEDS Pro) will be made available at what I hope will be a pretty reasonable price.

This project is still under development, and it may be some while before SEEDS Snapshots and SEEDS Pro go live. Also, as you may know, I’m planning a sequel to Life After Growth.

Meanwhile, of course, I’ll continue to post articles here – and please do keep making your very helpful comments.

 

 

 

32 thoughts on “#88: SEEDS to go live?

  1. Tim – Nate Hagens here from theoildrum. Ill be in London mid-march at Board meeting and giving speech. Would love to connect with you finally. (I had sent you my phd thesis on EROI and we exchanged a few emails back in the day. Your Tullet email is defunct (obviously). Thanks Nate

  2. Brilliant.

    Sounds like a lot of work.

    I’ve found your blog engrossing; good luck with all of your aims.

    I personally am more interested in a more regular commentary from you on the economy and where we are, where we’re going and how soon. However, I understand that economies move slowly so there probably isn’t much you could add on a more regular basis.

    Thanks for your work and blog/posts.

    • Thanks, much appreciated.

      I probably will do more frequent articles when workload permits – at the moment I’ve got the SEEDS project, the sequel to LAG and a chapter to contribute to a book on investment.

      It might be possible, when releasing each SEEDS download, to write an accompanying commentary on the subject country. My thinking at this moment is to start with Holland and France, in view of impending elections.

  3. Hi, since true international cooperation is rare, one hope is that islands of prosperity where you have flashes of good government could still be possible & show the way – even if not emulated, people locally would appreciate re/attaining civilisation.

    I’m thinking of countries who have the fortune to be able to control energy sources, preferably clean &/or renewable – it wouldn’t be enough to save the world, but could cover their own needs at least. Rwanda for example has a lake where gasses are naturally produced in significant quantity – there is apparently a project to use this, but it’s a fairly uncommon & so relatively technologically exploratory case. I am guessing with their proximity to volcanoes, they could also do something geothermal; most importantly they have leadership that is highly focused on self-sufficiency & often political will is the limiting factor.

    Skeptics can be forgiven for pointing out the likelihood of this being achievable in a third-world country is slight, but it can happen. I worked in nearby Kenya in the mid-90s & saw fissures in the ground at Hell’s gate in the rift valley, where steam escaped the surface of the earth all of the time. I was sad at the time that in a country where most couldn’t afford the electricity for even a couple of light bulbs, they could have had geothermal power stations, perhaps even excess energy for export to the neighbours. So I was pleasantly surprised to see a newsclip ~ a couple of year ago, showing a powerstation where i had stood …..the place was as corrupt as hell back then & has somehow gotten even worse, so if they can pull it off, it certainly can be done.

    • Thanks – fascinating stuff.

      The experience of my late father in Nigeria might interest you. He was lent to Nigeria by HMG to investigate a project – basically, people in the north needed work, and shoes, whilst hides of cattle were being thrown away. So the idea was to use aid funds to construct a tannery and a shoe factory there.

      When my father despaired of getting the information he needed in Port Harcourt, he went to the north to see for himself. The idea of a shoe factory, let alone a tannery, in that climate was mad. The hides were totally unsuitable. The people didn’t want factory work, or western type shoes.

      This is an example of how planners without real world experience get things hopelesly wrong. And I’m sure you’ve heard of the famous Nigerian Cement Fiasco…..

    • The weak point with shales is decline rates – output per well often falls by more than 50% in the first year of production. So operators are on a “drilling treadmill”.

  4. “Money may be the map of the territory, but the territory itself is energy.”

    Excellent, and neatly turned to illustrate your premise too.

    Your idea to offer 2 or 3 levels of SEEDS seems like a sensible way to try to get some well earned income for at least some of the time and effort you’ve put into this project.

    I’ve been following you since your Perfect Storm paper in your Tullet Prebon days and really appreciate your willingness to share your insights with us all.

    Thank you.

  5. Tim,
    I can only concur with comments made above. I was always hoping for an update on “Life After Growth – Might there be no way out for Britain ?” ( 2011 ), just to see where the figures went.
    On your 3 levels of publication, I think that you have a good idea there, it will keep body and soul together..
    Might I also add that if you had a Bitcoin account on your page, that some people might be willing to make a small discretionary donation for the content that you are willing to provide for free. I myself would like to offer a small donation, – ok I am not going to make you rich, ( I cannot even make myself rich ), but I would stretch to buying you a bottle of good wine, just to show my appreciation of the work that you do.

    • I think you’re referring to “Project Armageddon”. Things have got even worse since then – forget “growth”, because the stats one needs to look at are (a) debt (b) annual borrowing (c) the current account, and (d) real incomes vs cost of household essentials. (Most of these will be in the SEEDS dataset for the UK).

      My own view is that the UK economy is falling to pieces. This is not yet quite terminal, but will become so unless there is radical change in how the economy is managed. My hunch is that the necessary changes won’t happen until a crisis occurs. A few years ago, a then colleague described the UK to me as “a banana republic without bananas”. That was prescient.

    • P.S. I’m not making a commercial version of SEEDS available to make money – but I don’t intend to give it for free to for-profit organisations.

    • Yes Tim, it was “Project Armageddon”, it made fascinating reading at the time.
      I just wanted you to know that your work is appreciated.

      PS. I love the quote about the UK being a “Banana Republic without bananas”, that is absolutely hilarious, ( but in a sort of tragicomic way, as peoples lives are at stake ).

  6. Hi again Dr M. I have heard so many examples like your father’s that the sane response can only be laugh or cry – the resources sunk into helping in the world could actually be enough I’m guessing, but for the corruption & ineptitude of the actors involved. I remember back in those Kenyan days meeting a family of US missionaries who genuinely seemed good people based on our interaction. When I asked what they were up to in Kenya being foreigners there like me, they explained they were helping the Turkana people. These people are incredible, having evolved to live on an inhospitable moonscape over their history – few people on earth can match their toughness, by necessity they are experts on survival in a brutal desert environment where every action has to be useful to staying alive. As such, to improve their lives, you really have to do something spectacular …….so what did the well-meaning Westerners have in mind?

    They collected the funds from their locale in the US, took them to Kenya to contact the tribe (& explain to them what they were doing wrong) mainly handing out bibles & telling them about their version of god. I was in my mid-20s & facing a middle-aged man but didn’t know what to say – the people he was trying to teach herded livestock over kilometres every day on their nomadic treks, hunted dangerous crocs on the lake at night artisanally with primitive implements & guarded their wealth with AK-47s at all times to stay alive in raids by neighbouring desert pastoralists. To my mind, help for them would have been boreholes, a food trading system, an insurance program to replace herds wiped out in droughts, even rudimentary medical care, certainly education in any thing practical. Whereas a sheaf of papers they couldn’t read was useless even as toilet paper, not to mention the time lost on endlessly talking, that could have been spent on survival activities. Wikipedia wasn’t around in those days, but the church involved could have looked up Turkana in an encyclopedia …..I felt the westerners were less educated even on the reality of their own environment in their country than the Turkana were with respect to theirs.

    Ironically, oil has been discovered in their territory recently, but unfortunately the most likely scenario is that it will only result in them being dispossessed of their remaining territory which has already been reduced by climate change & ‘development’. Anything is possible given the political will – unfortunately good governance is as rare as (and related to) a good person attaining power.

  7. Thanks Tim for your continuing insights into these fundamental issues which, extraordinarily are not generally covered by the MSM I suspect because the messages are too uncomfortable.

    • Thanks – I hadn’t seen this, though I admire Chris B as a man who really DOES understand China.

      As I prepare the first SEEDS downloads – the brief PDF reports which will be freely downloadable – I’m thinking of prioritising China, because the results are very interesting.

  8. Hi, Dr T. Here’s another voice in the wilderness – echoing your call – this article from the Independent newspaper explains really well the current situation of using debt to give an illusion of growth. The author articulates it really well in clear, jargon-free, everyday language as concisely as possible too. Unfortunately, even in this mainstream media outlet, the number of people who will read and understand it is probably still insignificant.

    http://www.independent.co.uk/voices/global-debt-is-spiralling-out-of-control-a7612351.html

    For the most part, people battling in daily life just don’t want to think of scary, things,so constantly distract themselves with survival or mindless entertainment unless absolutely forced to confront reality. Actually your average commuter with glazed expression, rocking gently, headphones plugged in is pretty much a metaphor of our time …..sleepwalking towards the cliff edge.

    • Thanks for the link – excellent article, even better if the site didn’t try to get me to switch off adblocking….

      His data seems very good. More generally, though, we might get more of this sort of analysis if the data was more readily accessible. I’ve assembled all of it, but it was far from straightforward – maybe I should publish a summary here…..

    • @drtim

      adblocking – if you’re browsing on Android or iPhone the Ghostery browser blocks ads etc without triggering the anti-adblock messages as much; if you’re browsing from a desktop or laptop there’s a ghostery addon for Firefox.

      You can also ‘roll your own’ ad and tracker blocking using the hosts file on Windows. There’s some information on that here:

      http://someonewhocares.org/hosts/

    • @Savant – I just love this observation: “Actually your average commuter with glazed expression, rocking gently, headphones plugged in is pretty much a metaphor of our time …..sleepwalking towards the cliff edge.”

      Thank you.

      @drtim – there are no perfect solutions for adblocking; and one can spend endless hours trying to come up with one. Ghostery does about the best job out of the current contenders; and without having to try to block as many of the javascript nasties that you need to understand if you try to ‘roll your own’.

      I’ve no objections to static text or even images interspersed with the text on the page that I came to read – so long as they are instantly recognisable as adverts – but I object to my data allowance being eaten up by loading auto playing video and images; and to the tracking and exposure to malicious scripts.

      I’m always appalled by the amount of ads that I see when I have to use a computer that I haven’t had a chance to sort out some basic adblocking for.

      I’d happily make a donation to help make the time you take to post here worth your while – as I’m sure others would – so you should look into something like a PayPal donation button.

      There’s a ‘how to’ for WordPress here:

      https://en-gb.wordpress.org/plugins/wp-paypal/

  9. @Dr T. – the way I see it, the initial limiting step to getting this information generally known is just to get anyone interested at all, so the only thing I can think of at the moment is to follow the money. Most people care about their finances mainly with survival as the incentive; as such, perhaps approach entities that inform/educate (I’m being careful not to say advise) on looking after/improving your wealth. An important caveat being that those approached would have to not have an opposing agenda rendering them resistant to admitting anything but the conventional orthodoxy.

    Disruptive technologies like Fintech are on a tear at the moment, as well as sites aimed at amateur investors, so maybe think P2P and the Financial Independence movements. Counter-intuitively, some obvious candidates are ruled out because they’ve been corrupted by a corporate agenda, like academic institutions, who these days are more interested in fleecing foreign students and property speculation. Perhaps also neutral think-tanks, (if there are any not working as shills for various billionaire’s pet neo-liberal projects) who could actually influence policy somewhere in the world via education.

    • Thank you for some very interesting thoughts, all of which I have noted.

      Where I’m at right now is, first, getting the “product” right. This will consist of PDFs for free download, and more detailed datasets for anyone wanting to purchase them at a modest price. The latter may make money or may not – that’s not the primary aim.

      As I see it, this is a small contribution to a debate on how we remodel economics – as some economists now concede, things don’t work out as conventional interpretation says they should.

      Data is only part of that (though you’d be surprised at how difficult it has been to assemble a dataset for world debt on a basis which is both consistent and adjusted for inflation).

      The next part is some text. First, I’m writing a guide to SEE, together with a line-by-line user guide to SEEDS. Then there’s the planned book, a sequel to Life After Growth. What I’m aiming to do with that is start the redefinition of how we look at the economy, not just frighten everyone out of their wits with some projections.

      So it’s possible that the data project (SEEDS) and the book will run in tandem.

      I hope this makes sense?

  10. I am a newcomer to Dr. Morgan’s blog but see a similarity in the philosophy of Elliott Wave technical analysis and social behaviour, used by market traders, and the results predicted by “Life After Growth”.

    Am I under an illusion, or is there some merit in the comparison of these philosophies?

    • Welcome, and I hadn’t spotted a similarity but will now look into it. In my investment banking days, I was very involved with the theory, but more from a fundamentals valuatiomn basis than trading.

  11. Further to my previous posting regarding Elliott Wave forecasting, perhaps it is based on empirical data – whereas “Life After Growth” provides the theoretical underpinning.

    Whichever way one views it, both concepts arrive at very similar conclusions – a very extended and unsustainable economic environment.

  12. @ Default Options – Re:automaton mode – my pleasure. Actually I wasn’t even feeling contempt for people sleep-walking their lives away, it’s not possible to avoid the loved ones in your life being a cross-section of society, so we’ll all have people like that amongst our inner circle. It was more frustration about people I care about being hard to help, not necessarily because they’re ignorant, but more because they’re overwhelmed by pressures of modern lifestyles, so that’s all they can cope with to get through the average day.

    I appreciated your adblocking tip by the way, I only used adblock + myself until now, because I struggle with technical competence generally in IT …..which helps in restraining my criticising the weaknesses of others when frustrated 🙂

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