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The 3 Likeliest Ways Things Will Play Out From Here

Do you have a plan for each?
Thursday, September 25, 2014, 2:58 PM

Executive Summary

  • The wisdom and value of scenario planning
  • Scenario #1: A Slow Burn
  • Scenario #2: Fragmentation
  • Scenario #3: A Hard Landing
  • The prudence of taking individual action now, vs depending upon "the system" to react to future events

If you have not yet read Part 1: Ready Or Not... available free to all readers, please click here to read it first.

It all begins with the clear-eyed recognition that the old way of doing business is clearly unsustainable. And yet knowing that the various governmental and institutional powerbrokers are doing everything they can to perpetuate the status quo way of doing business.

Business-as-usual is literally going to end in some flavor of disaster, and yet we collectively adhere to it, even when the end-point is as obvious as calculating the linear rate of withdrawal of water from a non-renewing aquifer.

But there's nothing linear about the nested and/or intertwined complex systems we call the Economy, the Environment and Energy.  Each of these is independently complex, meaning they often easily defy the attempts to manage them. And they are utterly unpredictable for anything longer than the immediate term.

For example, of the three, Energy seems the simplest, and it is.  But even there, we note that the amount of energy that can and will be extracted is a function of the price of energy, available technology and skills, capital available for investment, and what's actually down there in the earth to be pulled up.  In that list, several factors are courtesy of the Economy, which is itself dependent on Energy. A glitch in one can feedback rapidly to create a glitch in the other.

Given all of this complexity, one good way to get a handle on things is to identify the scenarios we deem to be most likely given all available evidence, and then assign probabilities to each. Asking ourselves, What can we today to prepare for Scenario X? then allows us to begin constructing action plans to mitigate our vulnerability, and even better in cases, position ourselves to prosper as the future unfolds. 

Scenario #1:  A Slow Burn

In 2008, the practice of borrowing too much caught up with the developed world and a serious financial crisis threatened to take down the entire financial system.  Indeed, according to after-action reports from Hank Paulson (then Treasury Secretary) and Mervyn King (then BoE chairman), the world came within mere hours of a full-blown global banking system meltdown... » Read more

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The State of the Deep State

The monster in America’s closet
Wednesday, April 30, 2014, 8:43 AM

We’ve been hearing a lot about the so-called Deep State lately. What to make of this shadowy monster? Some observers link it to the paranoid fantasy called the New World Order, a staple of political talk radio (and a hobgoblin I don’t believe in). 

I like to say that I’m allergic to conspiracy theories because human beings are generally too inept to carry out schemes at the grand scale, as well as being poor secret-keepers. Insider knowledge is almost always swapped around, even in secretive organizations, often recklessly so, because doling it out confers status, tactical advantage, and sometimes money for the doler-outer. But the Deep State isn’t a secret. It operates in plain sight. » Read more

Insider

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Off the Cuff: Abnormal Times

Our institutions no longer serve our interests
Thursday, April 24, 2014, 1:47 PM

In this week's Off the Cuff podcast, Chris and Jim discuss:

  • The Dimming of US Legitimacy Abroad
    • Americans have a growing fear & distrust of our own foreign policy
  • Charity Begins at Home
    • Why are we sending $ abroad that is much needed at home?
  • Abnormal Times
    • We are so far from fundamentals that a correction is guaranteed
  • This Weekend's Seminar at Rowe
    • Kunstler will be participating
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"The Government Comes Up With the Money"

A mindset that's killing our economy
Tuesday, January 28, 2014, 11:48 PM

I'm half-heartedly watching the State of the Union address right now. What a cynic I've become.

My younger self would be shocked and saddened to learn how I've come to view these annual addresses as little more than a game of charades. The President (not just Obama, but his predecessors, too) reads a carefully and expensively constructed script designed either to elicit self-congratulatory applause from the echo chamber side of the hall, or to lob political harpoons into the other.

But in the end, it's nothing more than a game of words. And the real issues that desperately need addressing get ignored, glossed over, or showered with pablum and over-promises that will never materialize. » Read more

Insider

Off the Cuff: The Government Shutdown is a "Fiscal Suicide Mission"

A "one-size-hurts-all" outcome
Tuesday, October 1, 2013, 11:00 PM

In this week's Off the Cuff podcast, Chris and Utah Representative Ken Ivory discuss:

  • Impact of the Government Shutdown
    • A "one-size-hurts-all" policy
  • No one is stepping up to resolve the fundamental issues
    • "The system is broken"
  • States need to "own the problem"
    • Many are waking up to this reality
Insider

Rise a Pauper

Wealth confiscation is the next stage of the game
Monday, April 1, 2013, 7:46 PM

Because of exceptionally poor decision making on the part of Cyprus leadership both before and during the recent crisis, Cyprus is now consigned to a very dark future of economic depression and failure.

Whatever the jabbering from the Troika, a precedent has now been set.

The one genie that cannot be placed back into its bottle is the notion that bank depositor accounts are now fair game.  The larger lesson here is that a wealth tax is now one of the solutions on the table for various government authorities across the EU, US, and other developed nations. » Read more

Daily Digest

Image by Steve Snodgrass, Flickr Creative Commons

Daily Digest 3/31 - Cyprus Feeling Bailout Pain, E.P.A. Plans Stricter Sulfur Limit in Gasoline

Sunday, March 31, 2013, 2:37 PM
  • Debt a common theme as Americans struggle to feel benefits of recovery
  • Big Government: An Unnecessary Evil That Should Be Abolished
  • The Three Stages Of Revolution
  • Monte Paschi says lost billions in deposits after February scandal
  • Cardboard Cops Control Traffic In Bangalore -- Unless It Rains
  • In Cyprus, Feeling the Pain of a Bailout
  • E.P.A. Plans Stricter Limit for Sulfur in Gasoline
  • Bee Deaths From Colony Collapse Disorder On The Rise As Researchers Point To Pesticides
Daily Digest

Daily Digest 3/14 - Endless Government Manipulation, The Price Of Green Energy

Thursday, March 14, 2013, 9:43 AM
  • The graph Bernanke should look at before ‘exiting’ anything
  • Charlie Rose: Jeremy Grantham
  • Mark Faber: Endless Government Manipulation
  • Inflation Targeting Revisited; Three Major Fed-Sponsored Bubbles; Who Benefits From Inflation?
  • 1,000 companies going bankrupt in Italy every day as country faces full-scale ‘credit emergency’
  • Young inventor’s flash idea to scare off lions
  • Detroit City Council continues to fight governor's EFM plan
  • U.S. to let spy agencies scour Americans' finances
  • It's Going To End Badly
  • Thieves Blight Nigeria's Swamps with Spilt Oil
  • Deepwater rig worker weeps as he admits he overlooked warning of blast that set off America’s worst environmental disaster
  • The Price of Green Energy: Is Germany Killing the Environment to Save It?
  • Japan's Methane Hydrate Gas Extraction Is First In The World
  • Greenland's resources boom still more talk than action
  • Analysis: Antibiotic apocalypse
  • Pentagon weapons-maker finds method for cheap, clean water

  » Read more

Blog

Don’t Worry; Be Resilient

Reduce fragility and vulnerability
Tuesday, February 12, 2013, 9:23 AM

At some point, absorbing more information about the unsustainability of the Status Quo yields diminishing returns; it becomes emotionally draining and thus counterproductive.  Part of this exhaustion results from recognizing our powerlessness within the Status Quo, where independent thinking and structural innovation are winnowed out as threats to existing institutions and industries. » Read more

Blog

The Structural Endgame of the Fiscal Cliff

It's not just a temporary political event
Wednesday, December 26, 2012, 1:51 PM

To understand this endgame, we need to start with the financial and political basics of wealth and power in the U.S.

1.  Wealth and thus political power are highly concentrated.  The dynamics of rising wealth disparity and the increasing concentration of wealth are debatable; the disparity is not.  Roughly 70% of all financial wealth is held by the top 5%; within this top layer of ownership, the top ½ of 1% hold an outsized share. » Read more