Relax, it doesn’t have to be 40 years….
Totallygroovygirlfriday found this 30-minute video very interesting. If you are looking for solutions and a way to get to them, this video has some great tools/suggestions (more than just about money). Click here.
Well, this is certainly an interesting Monday morning. If they were looking to stabilize and create confidence in the European and global banking systems, gg thinks they missed.
This is just one more lesson in the past 5 years. Banks are not a safe place to keep money, you will be penalized for saving money, and saving the current collapsing system is the prime directive.
side musing: it also confirms what Martin says, there can be no conspiracy because they have no idea what they are doing five minutes before they do it. A well-thought-out plan would not piss off the Russian government. The powers-that-be are only reactionary and use every new crisis (whether they indirectly created it or not) as much as possible to retain power, influence, and wealth until it doesn’t work anymore. Then they move to the private sector and use their reactionary-crisis skills to destroy investor funds.
Click here for zero hedge comments. And here.
Update: seems to be going well…yeah right! They just extended the “bank holiday” to Wednesday/Thursday. Click here.
Another update: it just keeps getting more interesting. Problem is that Europe/IMF doesn’t have time for another option to bail out Cyprus, this was it (or Germany front the money…..) Click here. So more interesting than the Russian mob money, the citizen riots, and what this will mean for future “bailouts” of southern European countries is: what will they do in Cyprus, if they don’t do this?
Click here for Martin’s thoughts on the energy cycle, very important chart. And here, another post from the same day. A $175 oil price would greatly impact inflation in prices and the broad economy. It is unclear whether a Middle East Crisis, another global debt crisis, an abandonment of the petro dollar, or a crash in the USdollar would cause a $175 oil price and for how long.
groovygirl came across a great website with valuable info.
Click here for the The Petrodollar is Dead or Dying.
Click here for The Oil Market for 2013 and Beyond.
Some interesting quotes from the above links.
C.C.: The bank-centric US dollar economy is based upon a vacuum, and although there is a mighty economy behind it, I do not believe that the dollar-based system is sustainable in its current form.
The approach to clearing I advocate does not envisage a central issuer where all the market risk is concentrated, but is rather a framework agreement providing a mutual guarantee of credit obligations created and issued by producers and accepted directly – ‘Peer to Peer’ – by consumers.
L.S.: A crucial legislature in all of this seems to be the Commodity Futures Modernization Act of 2000 (CFMA). Why so?
C.C.: This statute enabled investment banks to conduct the trading techniques which were responsible for inflating market price bubbles.
Side musing: gg says, in relation to yesterday’s post about new systems, there is a possibility that in the future, with the help of the internet, that traditional ways of obtaining debt for business, investment, homes, technology, etc. will all be done without the current banking and financial systems. It will all be peer-to-peer from global to local levels. This will help the little guy in the local community get things moving in a new decentralized system and the larger player move in the globalization system.
Groovygirl has often talked about the paradigm shift happening right now in every aspect of global structure. From debt collapse to banking to food to government. This paradigm shift is driven by three main issues: debt, increase population and shift in demographics, and peak energy.
Since the beginning of the industrial age, these main systems have worked well. Or they have been modified to continue to work adequately to move forward, not back. However, the production model which is the basis for everything in first world countries from food production to derivatives to education to military doesn’t work anymore.
We have clearly moved into the information age, but the main systems of society are still in the industrial age. Charles Hugh Smith makes a comparison to the last time we had a major shift: from agriculture to industrial. The final push of all society into industry/production systems was the Dust Bowl, even though the Industrial Age started 50 years earlier.
Click here. Good post.
The systems and solutions of the past will not work. It is a waste of energy to focus on those things. Much better to discuss completely other ways of doing things. Having said that, the possibility that people in power will give up their power in a known system for no power in a new systems is highly unlikely. So, we will have to wait for the collapse of these systems. In the meantime, be thinking and experimenting in your own limited environment to find out what might work or not work.
Groovygirl falls into the Peak Energy crowd. Groovygirl was in the peak energy crowd before the 2007 peak oil report came out, because she understood the cycle of the contraction of debt.
The entire energy economy (and thus the entire economy) is powered by debt. Debt to get it out of the ground, debt to build refineries to process, debt to buy trains, trucks, and pipelines to move it where needed, debt by consumers and companies to purchase it who use it day-to-day. When the debt machine contacts, even a little, the cost of energy goes up, because of the lack of debt availability. A drop in consumer demand will never be low enough to compensate for the lack of debt.
The fall in availability of energy and the petro-dollar only adds/accelerates to the main problem: energy must cost more in the future. This will affect everything from building to travel to food to military.
Here is an interesting conversation about how peak energy (not just oil) might affect your financial decisions.
Groovygirl thought this was the most refreshingly realistic way to describe the US. Great interview with Mr. Greer via Peak Prosperity (Chris Martenson’s site). Mr. Greer has his own webblog, it is really good.
If you’ve ever seen a fifty-year-old man trying to pretend that he’s seventeen, it’s embarrassing. It’s embarrassing to everybody and it rarely ends well. That’s what America is right now. It’s two hundred something years old. It’s not an adolescent anymore. It needs to ditch the bright red car, stop trying to pick up teenage chicks, stop the binge drinking, and actually deal with the fact that there’s only so many years left. You need to do something useful with that time and not go around with everybody else – you know, China and Europe – just rolling their eyes and trying to pretend that they don’t notice how we’ve combed our hair forward over our bald spot.
Click here for audio interview.
We need to come to terms with the fact that we don’t have limitless energy, we don’t have limitless resources, we don’t have limitless time. All of these things are specific. They function within a finite world. And engaging in hand waving about well, human ingenuity is limitless. No, it isn’t. Okay, it may be immense, but it’s not limitless.
And so getting past that fetish of limitlessness strikes me as the most important thing. All of us are going to die – each individual person listening to this show and everybody else as well. That’s a limit we can’t get past. And you’ll notice that people who actually face that limit and say okay, I get this, I have a finite amount of years on this earth and them I’m going to die. What am I going to do with the time that I have? Those are the people that we call mature. Those are the people we call wise. Those are the people who go out and have a life instead of just frittering their time away.
Click here for Chris Martenson’s latest blog post Eye Wide Shut: We Are In A Bad Spot. Another excellent post regarding the real long-term issue. Which is NOT debt, but diminishing net energy return.
Net energy is how much energy does it take to get new energy out (mined, pumped, fracked, etc.) and useable and what is the net of those costs.
Imploding debt is a 5-10 year problem. Diminishing net energy is a 50-100 year problem.
Rising debt costs add to those costs, yes. But we must look at it from an energy to energy standpoint. Cheap and expanding debt hides the real picture.
And here is a discussion of some solutions to that long-term net energy problem. Local economies and guilds!
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