I’m Back…

A year ago I quit working on this blog when I lost confidence that I had anything unique to say. There are many people writing that are smarter and more eloquent than me.

I’m feeling again that maybe I do have something unique to say, or at least that I can offer a different tone.

I’ve updated the welcome page to reflect my renewed confidence.

By Jim White: Abrupt Climate Change: Past, Present, and Future

Climate is changing as humans put more and more greenhouse gases into the atmosphere. With CO2 levels today around 400ppm, we are clearly committed to far more climate change, both in the near term, and well beyond our children’s future. A key question is how that change will occur. Abrupt climate changes are those that exceed our expectations, preparedness, and ability to adapt. Such changes challenge us economically, physically, and socially. This talk will draw upon results from ice core research over the past twenty years, as well as a new NRC report on abrupt climate change in order to address abrupt change, as seen in the past in ice cores, as seen today in key environmental systems upon which humans depend, and what may be coming in the future.
~ James White, Institute of Arctic and Alpine Research

By Robert Marston Fanney: Grim News from NASA: Runaway Glaciers in West Antarctica

“Grim News From NASA: West Antarctica’s Entire Flank Collapsing Toward Southern Ocean, At Least 15 Feet of Sea Level Rise Already Locked-in Worldwide”

Grim News From NASA: West Antarctica’s Entire Flank Collapsing Toward Southern Ocean

By Steve Keen: Credit Money: How it Works and Why it Fails

I need to get a small rant off my chest. I promised myself no finger-pointing on this site but I have to make an exception for Economists. With a total disregard for physical laws, the scientific method, and insufficient calculus skills to create a model that reflects reality, the embarrassing discipline of Economics makes it possible for anyone to prove anything. And they do. All the time. Not one economist in a hundred has a clue. And these people are the most important advisors to our governments. Perhaps it is the fact that economists can generate any answer to any question that makes them popular with politicians, who to get elected, must tell voters what they want to hear.

The only economist I listen to is Steve Keen. He has a lot of important things to say. What distinguishes him from the crowd, and you are really not going to believe this, is that he includes debt in his models. Do yah think debt might be important? Duh. He’s also well grounded in thermodynamics which is vital to understanding the economy.

Credit Money: How it Works and Why it Fails, Part 1

Credit Money: How it Works and Why it Fails, Part 2

Credit Money: How it Works and Why it Fails, Part 3

Why Are We Printing Money?

It’s a simple question.

You’ll hear different simple answers depending on the politics of the speaker. Talking heads on the news will usually say it’s to stimulate growth or to create jobs.

It’s also a big clue.

Large scale money printing has been tried many times in history and it never ends well.  We can expect modest inflation at best, high inflation, social unrest, and war at worst. We’ve been printing full steam for 5 years. They must know it’s risky. They must have a good reason. What’s the real reason?

Could it be?

1) The government is unable to borrow sufficient funds to cover their large deficit without causing interest rates to rise, which would force large cuts in services, and so makes up the shortfall with printed money.

2) The government is worried that if they stop printing the stock market will fall because it has become dependent on easy money. And they don’t want the stock market to fall because then people feel less wealthy and spend less.

3) The government wants to encourage retirement accounts to switch from low risk interest bearing investments to high risk equities, thus stimulating the stock market and increasing investment in companies that might create growth.

4) The big banks are in trouble and are dependent on money printing from which they skim fees and carry trades to rebuilt their reserves.

5) The government wishes to debase the currency to improve export competitiveness.

6) The government seeks to cause inflation as a means of reducing real levels of public and private debt because they know the underlying economy is struggling to service its high debt level.

7) There is little or no real growth which means the money supply is not growing fast enough to cover interest owed on existing debts, and given high debt levels, a large deflationary collapse would occur without a continual injection of new printed money.

There may be some truth in all 7 possibilities, but I discount the first 5 because we’ve had government cutbacks, high interest rates, stock market crashes, bank failures, and competitiveness problems in the past, and we recovered just fine.

I also discount 6) because inflation will cause interest rates to rise which will be a very big problem for governments with high debt.

That leaves 7) which I think is the main reason.

We’ve bumped up against limits to growth.

By Steven Kopits: Global Oil Market Forecasting: Main Approaches & Key Drivers

One of the best talks I’ve seen by an oil industry analyst.

The Center on Global Energy Policy hosted a presentation and discussion with Steven Kopits, Managing Director, Douglas-Westwood, on the different approaches to global oil market forecasting. Mr. Kopits’ remarks focused on both supply and demand-based methodologies, including how these models result in different assumptions and implications for oil supply (OPEC and non-OPEC), total oil demand and oil price. He also reviewed other key drivers such as changes in the transport sector and overall economic growth and discussed how these variables can further impact oil demand and supply.