#112: Will things go bang soon?


We may not be clear yet about when the next crash will come, but we understand a very great deal about the mechanism that will make it happen. Put another way, we have a narrative that puts all the pieces in the right places.

This narrative is telling us that a crash is highly likely – and that it may happen a lot sooner than we think.

Let’s start with the fundamentals. Contrary to conventional thinking, the economy isn’t really a monetary system at all, but a surplus energy dynamic. What drives the output of goods and services is the quantity of energy we can access, less the energy consumed in the access process. If the available quantity is constrained – or the energy cost of accessing it increases – the output of the economy will decrease.

Money, having no intrinsic worth, has value only as a “claim” on the output of the real economy, which means, ultimately, that money is a claim on surplus energy. Debt, as a ‘claim on future money’, is really a claim on future energy.

For more than two centuries, there has been sustained growth in available surplus energy. This has enabled total financial claims – the aggregate of money and credit – to increase as well, without toppling the financial system.

What we’ve been witnessing since the turn of the century, though, has been an increase in the energy cost of energy (ECoE), combined with emerging constraints on the quantity of accessible energy. This process makes the continued growth in aggregate money and credit dangerous, because we are creating claims that the real economy will not be able to meet.

Once understood, this process makes sense of what has been happening. Between 2000 and 2008, credit creation soared, but debt-financed growth drove up energy demand in a way that eventually brought the system to the brink of collapse. In 2001, when prices averaged $24/bbl, OECD consumers spent about $430bn on oil, of which around $240bn went on imports. By 2008, when oil averaged $97/bbl, these numbers had increased to $1,700bn and $1,050bn. Oil was now costing OECD customers $1,270bn more than it had just seven years earlier – and $810bn of that increase was being spent on the higher cost of imports.

Moreover, these huge liquidity drains are only those related to oil. Other forms of energy also soared in cost, as did energy-intensive commodities such as minerals and foodstuffs.

This was what brought the debt-financed party to an end.

Looking a little more closely at this, the increase in the cost of oil to the OECD quadrupled between 2001 and 2008. The increase in ECoE over the same period was much smaller than this. According to SEEDS, global ECoE for all energy sources rose from 4% in 2001 to 5.4% in 2008, a rise of one-third.

So the rise in market prices vastly over-cooked the underlying trend in ECoEs. In relation to this fundamental benchmark, oil was underpriced in 2001, and overpriced in 2008.

This tells us that something else was going on.

That ‘something else’ was supply constraint.

Just as westerners were bingeing on credit, emerging market economies (EMEs) were consuming more energy and other commodities, notably as exports ramped up. Rising energy demand was colliding with more pedestrian growth in supply. Investment in supply tracked market prices higher. When demand dropped after 2008, the ensuing fall in prices became inevitable.

In retrospect, we “got away with it” in 2008, for three main reasons.

First, governments’ balance sheets were strong enough for them to bail out the banks without forfeiting their own credibility, and that of their currencies.

Second, the authorities bought time by adding monetary adventurism to the established credit adventurism.

Third, the cooling of the economy took the heat out of energy markets.

To know when and if a second crash may happen, and what its results are likely to be, we need to test these three “get-outs” as they now are.

First, government balance sheets. On the basis of amounts owed (rather than the market value of bonds), the aggregate debt of advanced country governments was 67% of GDP in 2007. Now it is 102%, and still rising. Bailing out the banks now would be a lot harder than it was back in 2008. Not only are government balance sheets weaker, but bank exposure has increased as global debt has grown. To be sure, reserves ratios are higher now than they were back in 2007. But, because banks borrow short and lend long, no amount of reserving can render them immune from the consequences of a loss of faith.

Second, “monetary adventurism”. Back in 2008, typical rates were 5.25% in the United States and 4.3% in the European Union. Now, the equivalent numbers are around 1% and -0.25%. There’s no scope, then, for further monetary adventurism, unless central banks are prepared to go for deeply negative nominal rates, a policy which would be barking mad, even if it didn’t, very probably, necessitate helicopter money and the banning of cash.

So that leaves us with our third component, which is energy. Essentially, a big rise in oil prices would crash the system.

Is this likely? On balance, it is. Oil demand is growing at around 1.4 mmb/d each year. Supply has kept pace, mainly thanks to increased shale and other unconventional output, plus an increase in supply from OPEC. Neither may be sustainable. Shales are extremely capital intensive, because of the “drilling treadmill” caused by ultra-rapid decline rates. Few OPEC countries have much scope to deliver increased supplies. Underlying ECoE, SEEDS says, is 42% higher now than it was in 2007.

Put this higher ECoE together with the slump in investment caused by the fall in crude prices, and the implication is that crude prices could spike, and do so rather more quickly than is generally expected.

That, then, is what we should be watching for when looking out for another crash. All the other conditions are in place, including excessive debt, weak underlying growth (reflecting rising ECoEs), overstretched government balance sheets, and an inability to repeat the monetary adventurism of 2008-09.

All that we’re waiting for is an oil price spike, and a trigger equivalent to the “Lehman moment”.

Both may come sooner rather than later.


#112 Oil price & energy ECoEjpg_Page1

81 thoughts on “#112: Will things go bang soon?

  1. Dr. Morgan,

    In your view is a deflationary crash possible?

    So far Governments in the western word have attempted to avoid deflation by printing money and lowering interest rates.

    This has not fully succeeded, do you think it will it be a option in the future?

    • I’ve also been wondering about this. It seems to me that it will be a battle between institutions over whether rates can continue to be lowered in order to provide the inflation necessary to service the massive debt loads. If not, could we see a true deflationary crash?

    • Good question. A deflationary spiral was widely feared, during and after 2008. It’s a logical possibility when demand weakens. But it didn’t happen. Why?

      1. QE and ZIRP. Critics of QE said it would trigger rampant inflation. Apologists for QE belittled these critics, said it wouldn’t happen, and still claim it hasn’t. But it has. The only distinction is that QE triggered asset price inflation, not consumer price inflation. It’s been well said elsewhere that increasing the quantity of money causes inflation where the new money is injected. Give it to everyone and consumer inflation takes off. Give it only to little girls and the price of Barbie dolls will soar. Put it into capital markets – what happened – and asset prices will inflate. It’s a blind spot for policymakers and many economists. They don’t see escalating prices of bonds, equities and property as “inflation”. But it is.

      2. Velocity slumped. Monetary velocity is how quickly a given dollar or euro changes hands. In confident times, people spend quickly. After a fright, they tend to be more cautious, hoard somewhat, and spend more slowly. The effective money supply is Q x V. You can increase Q without inflationary effect if V falls.

      3. ECoE. The rising trend cost of energy – what energy costs the economy, as opposed to the price, which is what it costs the consumer – has acted as a block to deflation.

  2. Thanks – excellent article…

    I am also leaning towards supply constraints and a price spike as the trigger.

    As we have seen since 2008… the CBs have been able to fend of the crisis of faith.

    And if even faith in the system falters — it does not seem to matter (at least yet)….the CBs simply will rush in and drive the markets ever higher — and institutional covers its shorts… and takes it big pile of money and follows …. bidding what is a completely fake market higher month after month …. because there is no fighting the Fed … as the saying goes.

    In theory there General Motors could sell no vehicles — but if the Fed were to support its share price… institutional money would buy GM…. just look at Tesla….

    A few brave souls sit their billions on the sidelines expecting the crash …. but they don’t last very long… because redemptions will soon put them out of business as punters see other funds riding the wave of unlimited CB largess. So they capitulate… hold their noses… and go long

    It’s gotten to the point where… bizarrely ….faith becomes reinforced as people begin to believe that the CBs can and will support the market forever….

    They clearly can support it for a very long time — perhaps for many years longer…

    Therefore…. being long the market does make sense (although I would recommend taking some fo the fake gains off the table and spending them because they will eventually be worth nothing)

    The only problem is that CBs are limited in terms of what they can do to grow the supply of oil … they have given birth and kept alive the genetic mutation known as shale … and they are no doubt supporting the conventional players with more than just low interest rates…

    But such things have limits….

    The beast is close…. real close… I can smell him….. listen… he’s at the gate.. hear that rattling? … that’s him…. he’s trying to work out a way through the last barricade…

    • “… perhaps for many years longer”

      You are right Thomas! And this is why discussions like this – and drtim’s work – are SO important!

      The beast is close indeed – and the beast of the market can remain irrational longer than we can remain solvent.

      And I think it will – and so I think our best hope is along the lines of a website designer who tries to make his pages degrade gracefully:

      It’s all bells and whistles for those who view with flash and cookies and javascript enabled – but it should still work for those who eschew all frills and surf with a text only browser.

      We now assume we can light our homes with electricity, cook on gas, fill our cars with petrol…

      We need to remember how real life is ‘plain text’.

      Learn how to make a simple oil / fat lamp; cook over a three stick fire, live in walkable communities …

      But not to get into the crazed survivalist prepper insanity.

      We must learn to degrade gracefully.

    • I don’t see that as an option. We lost that option when we embraced the Green Revolution and worked out how to feed billions more people using fossil fuels…

      Now we are so massively into overshoot that when we unplug … 7.5 billion people will be hungry and on the loose…. keep in mind we are the greatest predator to ever walk the earth …. no animal comes close…. and we are well armed….

      Then of course there is the issue of 4000+ spent fuel ponds that will be abandoned… they will boil then release massive amounts of toxins into the air… these will quickly spread through the air and oceans and we will inhale them … they will get into the food chain and we will eat them….

      Did I mention disease? When the antibiotics factories no longer churn pills out….. a different beast will charge through the gates…. numbering into the trillions…. each one bent on revenge… each one wanting to feed on us.

      I don’t think there will be much in the way of grace when our species goes down … for good

    • FYI, virtually all land capable of cultivation was in use by 1960. All increases in food supply since then result from energy inputs and improved methods. A big input has been nitrogen, which requires large energy inputs to supply. Energy costs therefore determine the cost of nitrogen, as well as other inputs, farming activities, food processing, transport, refrigeration and delivery.

      – Monoculture is debasing soil quality
      – Climate change is desertifying formally fertile land
      – Nutritional content per kg of the same food seems to be falling
      – Past nitrogen use seems to be threatening aquifers

    • Compounding the problem when the petrochemicals are no longer available:

      Soil that is farmed using petro-chemical inputs — will support no crop once the chemical additives are stopped – without years of intensive rejuvenation involving organic inputs.

      Effect of Pesticides on soil fertility (beneficial soil microorganisms)

      Heavy treatment of soil with pesticides can cause populations of beneficial soil microorganisms to decline. According to the soil scientist Dr. Elaine Ingham, “If we lose both bacteria and fungi, then the soil degrades. Overuse of chemical fertilizers and pesticides have effects on the soil organisms that are similar to human overuse of antibiotics.

      Indiscriminate use of chemicals might work for a few years, but after awhile, there aren’t enough beneficial soil organisms to hold onto the nutrients” (Savonen, 1997). For example, plants depend on a variety of soil microorganisms to transform atmospheric nitrogen into nitrates, which plants can use. Common landscape herbicides disrupt this process: triclopyr inhibits soil bacteria that transform ammonia into nitrite (Pell et al., 1998); glyphosate reduces the growth and activity of free-living nitrogen-fixing bacteria in soil (Santos and Flores, 1995) and 2,4-D reduces nitrogen fixation by the bacteria that live on the roots of bean plants (Arias and Fabra, 1993; Fabra et al., 1997), reduces the growth and activity of nitrogen-fixing blue-green algae (Singh and Singh, 1989; Tözüm-Çalgan and Sivaci-Güner, 1993), and inhibits the transformation of ammonia into nitrates by soil bacteria (Frankenberger et al., 1991, Martens and Bremner, 1993).

      Mycorrhizal fungi grow with the roots of many plants and aid in nutrient uptake. These fungi can also be damaged by herbicides in the soil. One study found that oryzalin and trifluralin both inhibited the growth of certain species of mycorrhizal fungi (Kelley and South, 1978). Roundup has been shown to be toxic to mycorrhizal fungi in laboratory studies, and some damaging effects were seen at concentrations lower than those found in soil following typical applications (Chakravarty and Sidhu, 1987; Estok et al., 1989). Triclopyr was also found to be toxic to several species of mycorrhizal fungi (Chakravarty and Sidhu, 1987) and oxadiazon reduced the number of mycorrhizal fungal spores (Moorman, 1989).


      Organic inputs will be hard to come by considering nothing can be grown – and most if not all animals are killed and eaten.

      Less than 1% of all farmland globally is farmed organically at this time.

      Get ready to starve. No matter where you are:


      (note – most organic land in Australia is rubbish and supports sheep only)

      I fail to see what more we could do to ensure the end of our species:

      – we have destroyed our means of producing food
      – we have exponentially overshot our population
      – we have held back (but not wiped out) diseases using artificial means
      – we live in bubbles with no understanding of how to live without BAU (and not only city dwellers – even the vast majority of permaculture farmers rely on BAU run their operations)
      – we have built a self destruct machine otherwise known as spent fuel ponds
      – we have distributed billions of firearms

      It’s almost as if we (or something) were subconsciously writing a symphony … one that ends in crescendo of incredible cacophony of suffering ….

      Then silence…

  3. Well, higher oil prices coming up. Things don’t look good in the Middle East, when the situation escalates we could see oil above $100,- in 2018. This would indeed blow up the fragile western economies and push oil back to $30,-. Our current system only works under affordable energy.

    Lets start a big war so we can push oil higher and blow up the debt balloon further to pay for all of it. War it will be.

  4. I would say a deflationary crash is not only possible but inevitable *unless* the Treasury starts funneling large amounts of newly created fiat money directly to consumers (Bernanke’s “helicopter money”). But if the new fiat money is deposited with the banks, it only becomes inflationary when bank loans exceed repayments and defaults.

    Investor Stephen Leeb (find his books on Amazon) claims to have discovered that whenever oil prices rise by 80% or more in a 12 month period, and recession inevitably follows approximately a year later.

    • I see this as a horse race…. you’ve got Peak Affordable Oil running against Deflationary Death Spiral….

      My money is that Peak Affordable Oil reaches the finish line first….

  5. As an afterthought, I googled up this interview with Leeb from 5 years ago. He is always interesting and thinks “outside the box.”

  6. Great article. I’d be interested to read more about the relationship, of lack of, between the Energy Cost of Energy and energy prices.

    • Thanks, and I’ll do what I can.

      Let me just add a proviso, though. Most economic models and interpretations are purely financial, so don’t include ECoE. In times past, when ECoE was small, this didn’t matter very much. Now, though, with ECoE high and rising, it does matter – and the big battalions wonder why their economic models keep diverging ever further from observed reality….

      The SEEDS system uses ECoE, and plots where it’s been – and where it’s going – on a multi-fuel, multi-year basis. The point I’m coming to is that I don’t disclose information that would enable big organisations to replicate how this is done.

      Within that, I’ll do what I can. And yes, it’s very important.

    • I’ve added the chart at the foot of the article.

      Oil prices are annual averages in 2016 dollars, from the BP Stats Review, except 2017, which is the recent price of $63/bbl

      ECoE is the trend for all energy

      Please note that these are on different axes, so how they relate at any given time is simply a function of axis range selection. So we can not say the two series “matched” in, say, 2004 or 2014, where they appear to intersect.

  7. Interesting times indeed.

    The writing has been clearly visible visible on the wall since the 1970s – for those who chose to see.

    Though only now do they begin to come to pass.

    It’s the sheer, willful blindness since then that continually astonishes me – though never in my wildest dreams did I imagine that we could draw things out for so long.

    . . . and yet I’m still in the slow collapse camp – punctuated by serial catastrophes.

    The Saudi thing has to be the trigger for the next step down. 2016 figures for oil production put Saudi in second place to Russia, with the US third (though it looks like the US shale peaked in 2015).


    So war / civil unrest in Saudi will take a major supplier out of the equation.

  8. Hmm…

    I’ve tried 3 times now to post a link to the Internet Archive’s complete archive of John Michael Green’s blog ‘The Archdruid Report’, but the Internet seems to eat my homework every time!

    I’ll try once more in a separate post – and if that doesn’t get through I’ll try another way.

    • OK – posting a plain link won’t work – so you can try copy and paste the link below into a text file and then deleting the spaces.





    • I did have a particular post from that blog that was particularly germane to our discussion, but I lost track in the battle to post the link at all, sorry.

      The entire blog is worth a read though – and now only available through that Web archive link.

      Bookmark it now.

  9. Very cogent work, Tim. Thanks. However I have a couple of quibbles. First “Government balance sheets”. Federal national governments don’t actually have any money of their own. It’s all “other peoples’ ” money [quote from Thatcher]. Government “debt” is other peoples money on deposit at the central bank. It’s not owed to anyone but the depositors themselves. It never gets spent [that would defeat its monetary operation purpose] So repaying this debt is a simple reversal of the accounts back to the other people. I hope that is understood? Governments CAN borrow but this operation can be discounted the same way as for the “Debt” The US Congress mandates selling bonds to match the deficits, but that is just an operation to create the bond market. The Fed has no need of bonds, [see above] It’s a form of corporate welfare.

    I’m not sure what you mean by monetary adventurism, as opposed to credit adventurism. I imagine it refers to QE which has injected a lot of money into the banking sector but virtually zero into the everyday economy. Between 2008 and 2010, the Fed “spent” $26 TRILLION on bailouts, [swaps] of good vs bad bank assets. That is 1/3rd of total world GDP! As we have seen, WHO NOTICED beyond the banker themselves? I didn’t see anything. I bet no one in the public realm noticed. It’s just a big number. So the conclusion is —They can and will do it again if they see that’s the option.

    • John

      Where I start from is that money has no intrinsic worth – even when it was gold, you couldn’t eat it, and I can’t think of any use for cowrie shells other than ashtrays. So it’s only worth is its exchange or claim value for goods and services.

      Now, if I have something to sell, I will accept your money for it, assuming that I trust that money – otherwise, I won’t. So trust in money is critical.

      Money is often said to be “loaned into existence”, so is “repaid out of existence”. Creation exceeds destruction, so the money supply increases – not a problem, so long as the real economy is growing at about the same rate. If these diverge, the supposed “value” of the claim must be destroyed, either by hard default or by “soft default”, i.e. inflation. It must be destroyed, because it cannot be honoured by the real economy.

      My term “credit adventurism” means making it too easy to create credit. By “monetary adventurism”, I mean manipulating the cost of capital to sub-inflation levels. At this point, assets inflate, real returns on capital turn negative, and so does the real cost of borrowing.

      Remember that we’re supposedly living in a “capitalist” system – but how can we have capitalism without positive returns on capital? If politicians and others tell us to trust (or simply accept) the workings of market forces, we need to ask them this: “so why didn’t you let market forces destroy reckless borrowers and reckless lenders in 2008-09?”

      Some politicians today attack “capitalism”. Others defend it. Yet capitalism was actually abolished back in 2008-09, when we didn’t let market forces wipe out the reckless. What we have now isn’t “capitalism”. There are other names for it.

      Incidentally, some of the world’s richest men, who had borrowed against the market value of shares in their companies, would have become paupers if we hadn’t inflated markets back up again.

    • Well Tim, it depends which trouble first comes to attention. If it is monetary, then possibly Steve Keen’s idea of a private debt Jubilee will be enacted. There is so much money in circulation within the banking sector [I have seen from 800 Trillion to $1.4 Quadrillion mentioned] that it will just have to be wiped off the accounts. It’s mostly insurance money anyway. Steve’s Jubilee will compensate the banks for writing off the mortgages but compensate the thrifty with a bonus. All deficit spending probably not in the books like the $29 Trillion I posted earlier.

    • Pensions are debts…. if we have a debt jubilee that would wipe out income streams for tens if not hundreds of millions of people around the world — which would set off a catastrophic deflationary death spiral.

      If you think about it…. we had what amounted to a debt jubilee in 2008 — essentially all financial institutions were insolvent… and that seized up the global economy…. until the CBs bailed them out and made them whole again … if not … I am not typing this

      I fail to see how a debt jubilee would resolve the problem of running out of cheap to produce oil. As has been explained this is a physics and math problem…

      BAU needs a certain amount of energy to remain operational …. if too much of the energy goes into producing the energy we use … then there is not enough to run BAU – and it collapses…

      Apparently debt does not matter anyway — the Fed has issued 27 trillion dollars of debt… at least…. well it does matter… because it is what is keeping BAU alive…

      The last thing we need is global bankruptcy…. if that were to occur then Korowicz would come into play http://www.feasta.org/2012/06/17/trade-off-financial-system-supply-chain-cross-contagion-a-study-in-global-systemic-collapse/

    • Yes, and No, TM. A debt jubilee wipes the debts and not the debtors. Pensions are debts created in government deficit accounts. They are paid as an injection into the economy from outside the non government economy. It most certainly will not wipe out income streams into the wider economy. It would wipe out bad banks,
      Yes a global bankruptcy is the last thing we need, but if the grid fails, all the accounts will vanish. I have the same argument as you and Tim. It is an energy based economy, but it peaked back in 1971 and thus forced us into a credit run economy. This cannot last.

  10. ” Between 2008 and 2010, the Fed “spent” $26 TRILLION on bailouts, [swaps] of good vs bad bank assets. That is 1/3rd of total world GDP! ”

    Pretty significant comment. Could you back that up with some links?

    Assuming this is substantially true, what kind of bailout “spending” would be attempted after the next implosion? – in various countries.

    • Thanks for this video – fascinating, and I’d like to know who the 14 banks were….

      What this tells us about next time is that they do the same again, on an even more gargantuan scale. But if that happens, why would anyone retain trust in the dollar?

    • The 26 trillion has keep the system going to the point where we are now facing peak supply of affordable oil….

      When that happens…. the extraction costs overwhelm the system…. and we will no longer be able to keep BAU alive … regardless of how much money the CBs inject….

      It looks like we have a very big problem in KSA …. with shale production flat lining… north sea is well past peak….

      All anticipated:

      THE END OF CHEAP OIL Global production of conventional oil will begin to decline sooner than most people think, probably within 10 years Feb 14, 1998 |By Colin J. Campbell and Jean H. Laherrre http://dieoff.org/page140.htm (originally appeared in the Scientific American)

      Aging giant fields produce more than half of global oil supply and are already declining as group, Cobb writes. Research suggests that their annual production decline rates are likely to accelerate. http://www.csmonitor.com/Environment/Energy-Voices/2013/0412/The-decline-of-the-world-s-major-oil-fields


      I diverge….

      ‘Michael Buffer earns, on average, $5 million PER fight and has a current Net Worth of $400 million.’

      Imagine that…. 10 seconds of work for 5 million bucks!!!

      If the goons in the Matrix ever approach me with an offer of rock stardom… I will say no thank you …. I want to be Michael Buffer….

  11. Martyn:

    In 2008, we could bail out banks because, whilst trust in banks had crashed, trust in money remained solid.

    That might be different next time. If it is, no amount of bail-out money would be enough.

    • I did say “attempted” !

      The whole area of “Limits” is mind-boggling because important assumptions go out the window.

      Suppose one or more major currencies were to collapse – might you paint the mechanics of some scenario? – possibly in future work, or in comments if brief enough.
      I presume there are legal structures and agreements at the foundation.
      There again, legal structures may disappear…

      What I’m getting at is the real nitty-gritty in “failure of trust” – what would have to happen (or not happen) for a currency to fail.

    • I can add a little to this.

      GBP is the likeliest major currency to crash for three main reasons.

      First, the British economy is very weak, its financial exposure is excessive (with bank assets at 1000% of GDP), and the economy suffers from long-term mismanagement.

      Second, prosperity (a key concept in surplus energy economics) continues to deteriorate, leading to popular disatisfaction. The authorities simply don’t understand this issue.

      Third, there are a lot of potential triggers. The government might implode. Mr Corbyn might take over (I’m not expressing a view, but the markets wouldn’t like it). Brexit negotiations might fail. Social unrest is a possibility, albeit not a strong one (yet).

      The mechanism is something I must write about, not least because the ensuing debate here could be fascinating. But I’m convinced it starts with an FX crisis. These have happened before, in 1967 and 1976. The latter required an IMF bail out, but the sum injected (in today’s money, about $60bn) is a drop in the bottom of a very small bucket given the magnitude of current problems.

  12. I would like to enter a cautionary note about doom from the outwash of the Green Revolution, population growth, and climate change. Please take a look at this research at New Mexico State University led by David C. Johnson:

    Click to access 789v1.pdf

    Development of soil microbial communities for promoting sustainability in agriculture and a global carbon fix

    What the research shows is that inoculating seeds with fungi can greatly increase production, nutrient content, soil carbon, water holding capacity, etc. We also have to stop deep tillage, which becomes unnecessary when the soil has a healthy microbe population. The inoculant can be easily made in an inexpensive bio-reactor invented by Johnson and his wife, the Johnson-Su bioreactor.

    Johnson has spoken a number of times about his process. You can find those videos by searching on:
    David C. Johnson soil
    (there are an amazing number of David C. Johnsons floating around, but the addition of the word ‘soil’ gets you where you want to go.)

    A note. When Johnson started his work, it was a government funded project to try to get rid of noxious industrial dairy manure which is full of salt. The bio-reactor is capable of using dairy manure to make a product which does not exhibit salt in tests (by binding the salt into chemicals). But as Johnson proceeded with his work, he found that the real key was to simply have enough compost full of fungal spores to inoculate seeds. That is a pretty small quantity of compost.

    From my perspective, the basic problem with Johnson’s method is that it does not require the services of Big Ag. Since Big Ag is a dominate political player, I wouldn’t hold my breath that Johnson’s program will ever get official endorsement. Johnson does see a relatively short and not very painful transition process, but he projects the cost at about ten percent of the carbon sequestration schemes now under consideration. And, as he says in one of his You Tube talks, we can either double food production or else produce the current amount of food on half the land with half the water.

    Don Stewart

  13. Ejhr2015


    Please provide more links to the websites referenced in the video. I can’t hear them clearly enough.


    • He talks about a report but I didn’t get any info about that. He mentions a reporter, Matt Tabibbi [I think] writing “The Housewives of Wall St” about the bankers’ wives getting loans at rates as low as 0.01% interest. You can probably search for it. The speaker is Randy Wray of MMT renown. You can look him up. I think the video is part of a longer lecture but I don’t know which one.
      Hope this helps. It is fascinating what the Fed can do!

  14. Auto-Loan Subprime Blows Up Lehman-Moment-Like
    by Wolf Richter • Nov 14, 2017 • 2 Comments
    But there is no Financial Crisis. These are the boom times.

    Given Americans’ ceaseless urge to borrow and spend, household debt in the third quarter surged by $610 billion, or 5%, from the third quarter last year, to a new record of $13 trillion, according to the New York Fed. If the word “surged” appears a lot, it’s because that’s the kind of debt environment we now have:

    Mortgage debt surged 4.2% to $9.19 trillion, still shy of the all-time record of $10 trillion in 2008 before it all collapsed.
    Student loans surged by 6.25% year-over-year to a record of $1.36 trillion.
    Credit card debt surged 8% to $810 billion.
    “Other” surged 5.4% to $390 billion.
    And auto loans surged 6.1% to a record $1.21 trillion.
    And given how the US economy depends on consumer borrowing for life support, that’s all good.

    However, there are some big ugly flies in that ointment: Delinquencies – not everywhere, but in credit cards, and particularly in subprime auto loans, where serious delinquencies have reached Lehman Moment proportions.

    Of the $1.2 trillion in auto loans outstanding, $282 billion (24%) were granted to borrowers with a subprime credit score (below 620).


  15. Re: David Johnson’s soil building methods
    Here is a news release from New Mexico State, for those who don’t want to read the scientific article.
    Johnson acknowledges his debt to the pioneering work of Elaine Ingham. But there are divergences. Johnson has focused in on the issue of fungi. Fungi and plants evolved a symbiotic relationship before plants ever came ashore and developed roots. The fatal hubris of both peasant agriculture and industrial agriculture was to think that we could grow healthy plants without fungi.

    Johnson, in some of his videos, takes us to the pecan orchards in New Mexico where the soil has been treated horribly, and talks about what needs to be done to restore them and what a few farmers are doing.

    The issue of ‘organics’ is a straw man. Johnson shows that ‘organic’ fields yield less than conventional fields in his study. But ‘organics’ is about NOT doing things. Nothing in the organic regulations requires the farmer to restore fungi. When Johnson restores the fungi, magical things happen.

    Don Stewart

  16. Life: The Basics
    It’s really hard to get oil or financial people to actually look at soil. We hear that industrial agriculture is running out of steam, so we are all going to starve. Here is a two minute video, which has been seen by fewer than 100 people, which illustrates the stark choice we face:

    The first soil sample, which has to be broken with a hammer and is still nothing a self respecting seed or microbe would want to associate with, is conventionally farmed soil from the Leyendecker farm at New Mexico State. The second sample has been farmed using the BEAM approach of David Johnson for 5 years.

    The second sample is part of a self-sustaining ecosystem which is getting irrigation water, but no inputs of industrial fertilizers, pesticides, or herbicides. The field did get one initial inoculation with homemade fungally dominated compost. Then the seeds for each succeeding crop are inoculated with fungal spores using a small amount of extract from fresh compost.

    The choice is ours….Don Stewart

  17. Excellent blog, thank you. I have been reading through the past entries and will be ordering your book shortly.

    I appreciate you don’t offer investment advice but, in a broader sense, how do you advise us – specifically, UK nationals – to prepare for the troubles ahead?

    • Thank you.

      I don’t give investment advice, but there are some sound principles which I’m sure you know. One of these is to diversify. Few people would put all their money into the shares of one company, but many have all their money in a single bank, or a in single currency. Gold may appeal, but if so it should be physical gold, in a safe, not a paper entitlement to gold, which ultimately is simply paper. Rumours that authorities may be bent on slashing or even removing deposit protection reinforce the case for diversifying.

    • ‘troubles ahead?’

      You mean the end of civilization… right?

      One day the stock market will hit a record high – again – on the basis of CB stimulus… and everything will appear ‘new normal’ … but then the next day the system will just break …

      The power will go off – forever…. petrol will stop flowing – forever.

      There will be no food – no electricity – no police no military — within a very short period of time – there will be total chaos…

      And there will be no reset – never. Because the system will come down because we have run out of cheap to extract energy.

      What I have done is filled a 20 foot container with party supplies — food – booze … some guns and ammo — I also have purchased a very fast car – when things get too grim — I will slash the airbags… and we’ll pile it and run that car into a rock cut at 250km per hour….

      Better that than to die from radiation poisoning when the spent fuel ponds are abandoned…

  18. Tim, going back to your thought that the US dollar could suffer a crisis regarding acceptability, My thinking is that the very LAST currency facing that will be the US$. Looking at the 2008 -2010 recession, the US Federal Reserve used it’s dollar to bail out a large contingent of foreign debt unrelated to the US position. IN any future crash situation the US$ will be the strongest support for any other currency facing collapse, such as the GBPound. It will only fail if the electric grid goes down definitively, a very severe situation, a civilization ending event.

    • That’s certainly the traditional view, and may still hold true, but I’m not quite so certain as I once was. After all, throwing $26tn at the problem in 2008 hardly inspires confidence. The USD is probably solid enough so long as it has the petro-prop – but that might not be indefinite.

      More interesting, perhaps, is whether the over-valuation of the dollar will continue, or decrease. I’d been thinking about writing about the dollar valuation question, but I have a huge amount on my plate right now, and a feeling that the coming months may not be drama-free…

    • ejhr,
      while I agree that the US $ is at present the worlds most powerful currency, I do not see it as untouchable.
      We all know the expresion, “The bigger they are, the harder they fall !”
      .. that may well be the case with the US $.
      That the £-Sterling is well and truely goosed, must be obvious to everybody by now, and only those with a vested interest in keeping it afloat will be the ones supporting it. It’s days are numbered. I must say, it would be ironic if the £ were to collapse so badly that the UK needed to join the Euro ! ( of course the Euro might not survive in its present form for much longer either )
      -Crazy times lie ahead.
      Getting back to the US $, it will of course survive, but I see it surviving in a much weaker form. Loss of the Petro-dollar status and a widespread fear of devaluation can make holding Dollars like snuggling up to a Leper.
      In the coming years I can see our friends across the Pond getting much less “Bang for their Buck”, as they used to.
      Just like the British are getting much less for their £ abroad these days, I can see American tourists suffering the same fate.

    • Yes, Johan, It may unfold as you suggest. I personally think it will take a catastrophe to shake the dollar. Not just a 1929 style depression or any one of the seven depressions that have occurred there since 1804, some of which were deliberately engineered by the banks, by the way. We’ll have to wait and see.

  19. Hi Tim,

    Another interesting blog thank you.

    I’ve been following your work for a number of years and regularly use it to inform scenario based planning activities I have done for UK government, and also for my family’s financial planning.

    Have you been able to consider how much energy and resources may need to be diverted into mitigating environmental and ecological risks over the next few decades?

    The follow on questions being – How could this potential additional energy obligation, right at the time we least need it, affect surplus energy availability and hence prosperity?

    I know you are busy – sorry for throwing in another factor to consider in your modelling.

    Dr Kevin O’Neill

    • ‘Have you been able to consider how much energy and resources may need to be diverted into mitigating environmental and ecological risks over the next few decades?’

      Not sure what you mean by this but I very much doubt we have any decades left… maybe a few years… possibly only months.

      As Tim has explained — we are on the threshold of total collapse — the cost (energy) required to extract fossil fuels has been skyrocketing since the turn of the century….

      Every single day we run out of low hanging fruit — and are forced to reach higher…

      The amount of energy available to operate the economy will soon not be available…

      There is no fixing this problem — we need cheap oil and coal and gas to keep BAU alive — because there are no other options that can replace these fuels (cheaply or otherwise).

      ‘Renewable’ energy is not helpful – it is expensive – it is intermittent. It is useless.

      So here we are – on the edge of the abyss. Needing to burn more fossil fuels every single year – or we collapse.

      TINA – there is no alternative.

      The environment is irrelevant — we have never done anything to clean up the environment other than locally i.e. we shipped manufacturing and all the pollution that goes with it to China and various other countries willing to accept our environmental disasters.

      Nothing will change — because we will continue to burn fossil fuels — right until the moment that we are forced to stop because we peak.

      And then BAU will end – the power will go off — and we will be observing crystal clear blue skies — while we slowly starve to death.

    • Dr O’Neill:

      First of all, I’m not an expert on climate science, so I have to come at this cautiously. Let me say that I’m in no doubt at all about the climate change issue.

      My approach would be along the lines of ‘economic rent’, and there are clear similarities between the earth as a “resource packet” and as an “environment packet”.

      To explain. In times past, it seemed there was no meaningful limit to energy availability. Now we are butting up against limits, not “running out” of energy, but finding it increasingly costly to access (the Energy Cost of Energy). As this cost (in BTUs, not money) rises, the resources required by energy access increase, leaving less for all other things. I call this the ‘cost characteristic’ of a finite packet, in this instance of energy.

      The global environment is another finite packet, with its own ‘cost characteristics’. Again, in times past these limits seemed meaningless. Now, again, we are butting up against limits, in terms of:

      – what the environment will tolerate

      – the restrictions it imposes on what we can do

      – the resulting economic rent (a climate change equivalent of ECoE)

      I’m influenced by Lovelock’s concept of a system which is self-regenerative unless we take out too much, undermining regenerative capability. I can think of no rationale by which this is not, true both of the environment and of the energy packet.

    • I might add that it shouldn’t be particularly difficult to tie together ECoE and surplus, energy intensity and CO2 emissions. It’s just something that I’ve never done.

    • I’ve been looking into the numbers – SEEDS economic data and CO2 emissions – and I think there may be something very interesting here. I’m considering an article about it.

    • Thanks for your thoughts on this Tim.

      The idea of modelling this factor using an economic rent and the ability to bring SEEDs to bear on these questions seems very interesting.

      I have considered modelling myself but realised with SEEDs you may be in a far better place.

      I look forward to any future thoughts on this additional factor(s).

      I have been trying to come to a conclusion about the various climate change risk mitigation technologies that are usually lumped together as techniques for “geoengineering” – which are also assumed to be active within IPCC low-carbon scenarios.

      However, these techniques seem to require infrastructure to be applied on a very large scale and be continuously maintained. The proponents of these technologies don’t seem to properly consider the costs of these projects, particularly increasing ECOE, the resultant effect on energy price, and whether this could:

      1. Leave them unable to properly implement their plans since the energy expense makes it financially infeasible.

      2. Allow the plans to be implemented, but the resulting “economic rent”, cripples economies and severely affects prosperity.

      I have tried to consider increased financial cost of energy due to increasing ECOE in my feasibility assessments of these climate risk mitigation ‘mega projects’ (sea level rise defences, BECCS, atmospheric engineering, alternative energy and transport infrastructure). I got a bit tired of being forced to work with the group assumption that we could always afford the energy and resources to implement and service these types of projects – especially when they need to be delivered concurrently.

      The cost modelling I have been involved in government uses historical costs of projects to help estimate future costs of projects, adjusted for inflation, however, I have never seen a consideration of energy and resource price inflation due to increasing ECOE – at most it was a temporary spike due to ‘geopolitical tensions’. I have even seen through-life costs estimates based on the premise of increasing energy affordability due to ‘unknown new technologies’ and ‘efficiency improvements’.

      The problem with this ‘magical thinking’ is that is being done on studies supporting investment decisions by policymakers – who could be misinformed about the costs of the projects, unable to plan properly for these projects, and ultimately unable to properly implement the projects because it wasn’t financially resourced well enough due to unrealistic assumptions on future cost of energy and it’s availability.

      I’m no proponent of such geoengineering marvels – but I feel if we ‘go for it’ we need to be informed so we can commit the required through-life financial resources and understand the potential effects these commitments have on the rest of our economy and prosperity so we can prepare accordingly.

    • Thanks.

      Since your first comment I’ve been looking at some figures, and the results are interesting enough to justify pursuing it further, at least to an article here.

      A basic premise of surplus energy economics is that, as ECoE rises, growth becomes harder to attain (and, if ECoE rises far enough, growth ceases to be achievable at all). This began to have a noticeable effect – “noticeable”, that is, to those knowing what to look for – in about 2000. Since then, we have been “faking” growth, first by ultra-easy credit, and latterly by ultra-cheap money.

      Where this is relevant in climate change terms is that it falsifies the economic data input to CO2/GDP calculations.

      CO2/year in 2001: 24.3 bn tonnes
      CO2/year in 2016: 33.4 bn tonnes = +37%
      Real GDP in 2001: $73tn PPP
      Real GDP in 2016: $120tn = +65%
      Therefore, “we have achieved less CO2 per unit of GDP”.

      This reassuring conclusion depends, however, on the GDP numerator being valid. According to SEEDS, it isn’t, because:
      – ECoE is rising
      – We’ve been countering the ECoE “headwind” using easy credit and cheap money.

      If this is correct, we’ve been deluding ourselves over CO2/GDP relationships. If SEEDS is correct, ‘real’ growth in economic output since 2001 has only been 26%, which is less than the rate of CO2 increase.

      A further point of great interest, to me anyway, comes from a study by the Chinese University of Petroleum. Taking EROEI (another way of looking at ECoE) into account, this report concludes that China will now have to start using a lot more coal, because the EROEI(/ECoE) of oil supply is deteriorating, implying – amongst other things – a peak and decline in economically viable indigenous oil production. Assuming (as the report seems to do, and, if so,correctly) that China cannot fill the gap with ever greater amounts of imported oil, it postulates very rapid increases in coal consumption. It also observes thast China’s rapid economic growth has been predicated on very rapid escalation in energy consumption.

      Meanwhile, and as ECoE rises, has China joined the West in “faking” growth? Chinese debt in 2007 was about US$ 7 trillion. Now it is about $40tn. Christopher Balding, reading the runes of official pronouncements, thinks it might be twice that number.

      From a climate change perspective, if rising petroleum ECoE (nationally, but in overseas supply sources too) pushes China into ever greater use of coal, the implication is that CO2 output will accelerate……

    • So, the collective pat on the back industrial civilisation has been giving itself for being able to continue to achieve ‘growth’ with less emissions may not be deserved.

      This is very interesting and quite worrying (the best type of insights are).

      A hypothesis comes to mind when combining this insight with what I have been reading about the state of natural carbon sinks:

      Premise 1: Real growth in an industrial civilisation is a linear function of fossil fuel use primarily, with other factors (e.g. ‘innovation’) being relatively negligible. (What your figures above are suggesting to me)

      Premise 2: Growth in industrial civilisation necessarily reduces the effectiveness, over time, of natural negative carbon forcing systems – example: forests and oceans.

      Premise 3: No effective man-made negative carbon forcing systems are active.

      Hypothesis: The rate of change of CO2 emissions with Real Growth (call it dC/dG) will increase over time, if growth continues

      i.e. dC/dG will transition to an exponential relationship, if not already there, as the natural carbon-sinks weaken.


    • Well its a good job we can’t achieve real growth anymore, or not for much longer at least 😉


    • I must add a point about “unknown technologies” (which reminds me of the “proven undiscovered oil” I once found in an oil company’s documentation).

      Technology works within the envelope of thermodynamic possibilities of the resource to which it is applied.

      Thus, technology has made shale more economical to produce than shale itself was in years past.

      It has not made shale as economical as giant conventional oil discoveries of the past (such as Al Ghawar in Saudia). The physics do not permit this.

      In the tech field, extrapolated progress may be valid. In the real, physical world, it is not. An example I often use is maritime radar. The electronics have got smaller, but the scanner on top of the mast, and the height of the mast itself, have got bigger. As a naval architect told me, “we can miniaturise electronics, but we can not miniaturise the laws of physics”.

    • Yes, as I see it, you are right in your conclusions.

      So is James Lovelock, arguing that “sustainable development” isn’t possible, and “sustainable retreat” is the best we can plan for.

      I’m writing up the main takeaways of SEEDS & CO2 for an article here.

  20. Some scary stuff here…I thought I was a natural pessimist but some of the predictions here are way too extreme for me!.
    What worries me most is we live in a post truth age. If you can be bothered to follow the Brexit discussions you will soon realise that what the senior politicians and media are talking about bears little relation to practical reality. It’s all about posturing to spin a line that creates a neat narrative for the 10 o’clock news. But this is how the world is run – on a series of actions that are supposed to make us feel better.
    Most don’t know the difference between the single market and the customs union. They don’t have a clue about the complexity of the trading arrangements built up over 40 years of membership. All we get are grand ‘visions’ and never any details. A no deal would potentially be a disaster as even countries that rely on WTO use a web of agreements ..the type of which the Uk has no time to make.

    So here we are…a cliff edge infront of us..even if our leaders could see the danger I’m certain they wouldn’t have any idea what to do about it for they have lost the ability to think and reason and ultimately dig our way out of this mess. Political correctness bears much of the blame. The politically correct truth always trumps the factually correct version making us hopelessly blinkered to hazards.
    I have a question for Dr Tim …why can’t the amount of clever thought that went into the processor of the iphone, or the Concordes wing be utilised to run the world economy?. Is it just that the wrong people are perpetually put in charge?. Why can’t we sort out the dud economic theories from those that actually work – if we can put a computer on a matchhead why can’t the human race prove say MME is fatally flawed – why always the ambiguity. Are economists, (Dr Tim not included!) just not as bright as engineers and inventors?

    • Ken:

      Some of it’s a bit scary for me, and respected newspapers have called me “terrifying Tim” and “Dr Gloom” before now!

      As a starter, I strongly recommend reading the wikipedia entry on James Lovelock. Specifically, he has said that the scope for sustainable development is gone, and we need to be planning now for sustainable retreat. An obvious problem is that our economy doesn’t have a reverse gear.

      On “Brexit”, I’m neither pro- nor anti-, in principle, but anyone who thinks a “no deal” Brexit makes sense is an idiot. Britain needs a deal and so, for that matter, does the EU. What would probably follow would be a deal with the US, very much on pro-US terms, which could make trade with Europe very difficult indeed. I’ve written here, not long ago, about how US and European visions of the “market economy” are diverging. Taking the US rather than the European route would, in my opinion, be a very unwise thing to do. Personally, I think the “Anglo-American economic model” of capitalism is a proven failure. I make no apology for favouring a “mixed economy”, private and public sectors each doing what they do best.

      Seeing things from a UK or US perspective isn’t always helpful. In times past, we had a “left” which stood up for “workers”, that is, for most ordinary people. But the “left” sold out – its leaders seemed keener on joining the rich than bringing them to heel. Yet they wanted to remain “relevant”. That’s why they came up with PC. If you pursue identity politics – race, sexuality and so on – you can seem relevant and “radical”, despite having given up on “working class” causes, bought the villa in Tuscany and packed the youngsters off to public school. The people who talk loudest about PC forms of “equality” are those who also conspicuously avoid “equality” when it comes to income, wealth or education.

      The voters – I’m pleased to say – seem to have seen through this. That’s why Labour are rejecting the “Blairites”, and why Americans didn’t elect Hillary. In British politics, I can understand and listen to most factions – the Conservatives, Jeremy Corbyn, Vince Cable, Lib Dems (other than Clegg), the SNP,…. – the only group I truly despise are the “Blairites”.

      Funny you should mention Concorde, as one of the Fellows at my College designed a critical part of it. It’s interesting that, whilst a high proportion of Western politicians are lawyers, many Chinese leaders are engineering graduates. I recall reading (in Dambisa Moyo’s brilliant How The West Was Lost) that US colleges turn out 44 law graduates to 1 engineer.

      Seriously, though, would many of our readers here want to go into politics? I wouldn’t!

    • A couple of thoughts…

      There is no democracy — well there is … when it comes to the little things… like repairing pot holes… gay marriage … and so on …

      But the really meaningful issues – like war — and the economy — and bail outs … and Brexit — are too important to be voted on… and I agree… people are easily manipulated and they are basically stuuppid.

      How long ago was the Brexit vote taken? Must be coming up on two years now… and remind me of what has changed? Or right – nothing. This will be tied up in the courts till the end of days (which are not far off)

      ‘even if our leaders could see the danger I’m certain they wouldn’t have any idea what to do about it for they have lost the ability to think and reason and ultimately dig our way out of this mess’

      At the very highest levels (Central Bank owners) they see the abyss — they understand that when the next shoe drops they will be powerless…. that this will bring the end of days….

      How do I know that? Simple – just look at the ‘insane’ policies — ‘whatever it takes’ — propping up the markets — making loans available to bums …. and on and on …

      Essentially they are dropping bombs into the economy — understanding that if they do not —- it will collapse immediately — of course knowing that the bombs will eventually destroy the economy (if the energy bottleneck doesn’t arrive first and take it down)

      Think 1929… the CBs refuse to allow the crash to happen — instead they just push the markets higher…

      That is where we are at —- so even if oil were not a problem — there is no perpetual economic motion machine — you push 1929 higher for another decade and something busts — and then you fall from an epic height… and you can’t put Humpty back together again …

      The cliff is exponentially higher in 2017 because of the JIT global supply chain and the interconnected financial backbone….

      The CBs understand that their actions will result in a cataclysm.

      So why are they doing this? I used to follow the line that suggested they were venal/stupid/insane….

      Then I shook my head and said nah — they run the world — money is not an issue — and you do not run the world if you are stupid/insane…


      Here’s the answer:

      According to the OECD Economics Department and the International Monetary Fund Research Department, a sustained $10 per barrel increase in oil prices from $25 to $35 would result in the OECD as a whole losing 0.4% of GDP in the first and second years of higher prices. http://www.iea.org/textbase/npsum/high_oil04sum.pdf

      Steven Kopits from Douglas-Westwood said the productivity of new capital spending has fallen by a factor of five since 2000. “The vast majority of public oil and gas companies require oil prices of over $100 to achieve positive free cash flow under current capex and dividend programmes. Nearly half of the industry needs more than $120,” he said http://www.telegraph.co.uk/finance/newsbysector/energy/oilandgas/11024845/Oil-and-gas-company-debt-soars-to-danger-levels-to-cover-shortfall-in-cash.html

      THE PERFECT STORM (see p. 58 onwards)
      The economy is a surplus energy equation, not a monetary one, and growth in output (and in the global population) since the Industrial Revolution has resulted from the harnessing of ever-greater quantities of energy. But the critical relationship between energy production and the energy cost of extraction is now deteriorating so rapidly that the economy as we have known it for more than two centuries is beginning to unravel. http://ftalphaville.ft.com/files/2013/01/Perfect-Storm-LR.pdf

      They have NO CHOICE. (TINA). We are running out of cheap to produce energy (and other resources)

      We need to offset the negative impact on growth of expensive resources with debt and other stimulus…

      The real leaders know exactly what is happening — and they are doing exactly what needs to be done to fend off disaster ….

      I am certain that they have teams of experts working around the clock to fight the good fight … they would have super computers running scenarios — what happens if we implement this policy to keep the oil flowing — what about if we do this… or that

      Keep in mind these are the same people who have war gamed the most unlikely scenario — they are THOROUGH.

      They would be applying the same thoroughness to the problem of imminent extinction.

      If they were not we would have collapsed long ago. You don’t buy this much time by being lucky.

      The CBs deserve a big round of applause.

      Remember what Bernanke said when he stepped down … something to the effect ‘I know a lot of people hate me — but when they eventually see why I did what I did – they will thank me’

      That’s as close as you are going to get to admitting what the real nature of this problem is.

      It is a problem without a solution. It is a problem that already has the best and the brightest working on it.

      1+1=2. A circle is not a square. BAU cannot function without cheap to extract oil.

      You can lock the most brilliant people on the planet in an empty room and ask them to make a peanut butter sandwich — they will of course fail.

    • I’m just ploughing through a book entitled “Sapiens” by Yuval Harari, an anthropological overview of the species.

      He says that the biggest mistake made in evolution of the species was the discovery of agriculture. Why? Because increasing food production enabled an increase in population and, as we were later reminded by Malthus, population increases geometrically whereas resources increase arithmetically.

      We seem to be getting ever nearer that point where an infinitely increasing population grinds against finite resources and it strikes me Tim that this is the proximate cause of what you are suggesting via the SEEDS analysis, that is the driver is population increase and the energy deficit is a reflection of the needs of this rapidly increasing population meeting the finite resource of energy.

  21. Thanks Dr Morgan there is much for me to think about there…must say that Dr Doom does have a certain ring to it!. Do you recall the part of Concorde that was worked on at your college? – I’m in the process of lobbying BA to grant approval to apply ground power to Concorde BOAC based at Manchester airport but it’s an uphill struggle. Hopefully the famous nose will move again oneday.

    I share your loathing for the Blairites. In my view they are the most potent destructive force ever unleashed in British politics in recent times. Blair really was ‘Phoney Tony’ – masquerading as a middle of the road ‘straight kinda guy’ to disguise the fact he was actually running an extremely radical government with PC doctrine at it’s core. The soviets had the gulag..the left have PC to control it’s opponents.
    What is galling to me is everyday I am reminded of the loathsome Blair creature when we hear of further news about the horrors of the middle east or the hangover from the mad spending days of Labour. Spending that is now all but impossible to roll back to sustainable levels – was it Roy Jenkins that said ‘it’s one thing to give a dog a bone, quite another to take it away’.

    What concerns me deeply is that the Conservative party decided that rather than fight Blairism , they would try to emulate it. David Cameron was the ‘heir to Blair’ and Mrs May was cast in the Blairite mould. The old Conservative party is now dead condemned as the ‘nasty party’. The choice is hard left or another heir to Blair who prefers ‘virtue signalling’ over matters of race and gender politics to dealing with serious matters.

    What a mess!.

    • He developed the sound reduction system – including negative noise.

      Amusingly, it was said – wrongly – that he invented the drooping nose. This was because, when he arrived at a party, apparently, the door swung back and hit his wife in the face. He examined her injured nose and said: “you’ll be fine, but you’ll never go supersonic again….” (student anecdote).

    • Thanks lovely story Re The Concorde!. That’s interesting negative noise being used – I presume this was to abate cabin noise ?. As far as I’m aware the noise of the jets at ground level was controlled with restrictions on the use of reheat until a certain height threshold was reached/

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