Peak oil

Mistaking Peak Prices for "Peak Everything"

Economic Super-cycles and Falling Commodity Prices

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Commodities Image
alphainvesting

Plunging oil prices have been big news over the past year. Since mid-summer 2014, the price for benchmark West Texas Intermediate (WTI) crude has fallen from $105 to $48 per barrel. But it's not just the price of petroleum that has plummeted. The prices of lots of other industrially important commodities have also been dropping.

The International Monetary Fund Metals Price Index soared to 250 points in March 2011 over its 2005 baseline of 100 points. By February 2015, the IMF Metals index had dropped to 137 points—a tumble of about 55 percent from its high. In other words, commodity metal prices are now back to where they were in early 2006. The IMF metals index covers copper, aluminum, iron ore, tin, nickel, zinc, lead, and uranium.  Similarly, the IMF price index for all commodities—including fuel, food, beverages, and metals—topped 210 points above the 100 point 2005 baseline in March 2011 but has now sunk to 121 points, a fall of about 57 percent. Again, it's about back to its level in early 2006.

The steep run-up in commodity prices that occurred over the past decade provoked numerous predictions that the world was about to run out of all sorts of resources. And why not? Higher prices, after all, would indicate that resources are becoming scarcer relative to demand. The classic of the doomster genre is Peak Everything: Waking Up to a Century of Declines by Post Carbon Institute fellow Richard Heinberg. In 2010, Heinberg doubled down and asserted, "The world is at, nearing, or past the points of peak production of a number of critical nonrenewable resources—including oil, natural gas, and coal, as well as many economically important minerals ranging from antimony to zinc."

If everything was "peaking" when prices were going up; what does it mean when they are coming down? This is where explanations based on the theory of economic "super-cycles" might shed some light. Economists Nikolai Kondratiev and Joseph Schumpeter noticed that since the late 18th century the prices of most commodities tended to rise and fall in waves lasting 40 to 60 years. However, the troughs of each successive price wave tended to be lower than the last, indicating that the real prices of commodities were falling over time. In general resources are becoming ever more abundant, not scarcer.  

According to Kondratiev and Schumpeter these "long cycles" in commodity prices are driven by periods of rapid industrialization and economic growth spurred by technological progress. In 1938, Schumpeter identified three cycles: the first associated with the beginning of the Industrial Revolution in the early 19th century; a second characterized by "railroadization" and industrial expansion in Western Europe and the United States; and third that based on "electrification" and the internal combustion engine.

Another way to conceptualize the price upswings of past super-cycles is that each occurred as new countries joined the global capitalist enterprise system. This would include cycles associated with the successive industrialization and economic expansion of Britain, followed by the United States, then Germany and Japan, post-World War II reconstruction, and lately the rise of China and India.

Commodity prices ramp up as economic growth speeds up in the early part of each cycle. Incited by rising prices, entrepreneurs then work hard to develop new supplies, increase resource use efficiencies, and find substitutes. In essence, this process is technological progress. On the downswing of the each super-cycle supplies catch up with demand and prices begin falling.

Are we on the downward sloping side of the latest super-cycle? Very likely. In his 2014 working paper, "150 Years of Boom and Bust: What Drives Mineral Commodity Prices?," Dallas Federal Reserve Bank economist Martin Stuermer analyzed the real price and production trends of four industrially important metals—copper, tin, lead, and zinc—between 1840 and 2010. 

Stuermer reports that "price surges caused by rapid industrialization are a recurrent phenomenon throughout history."  The most recent surge in commodity prices, according to Stuermer, is due mostly to "large demand shocks attributable to China in 2003 to 2007." The effects of China's demand shock are now dissipating. Stuermer asserts that if "there are no new positive demand shocks, the results [of this analysis] suggest that current prices might further fall, as supply catches up and prices return to their long-run trend." He adds, "Commodity exporters should thus prepare for a further down swing of mineral commodity prices." Ultimately, Stuermer expects that mineral commodity prices will "return to their declining or stable trends in the long run."

Stuermer's analysis bolsters the conclusions on super-cycles reached by Northeastern University economist Bilge Erten and Columbia University economist Jose Antonio Ocampo. In their 2012 super-cycle working paper, Erten and Ocampo report evidence for four commodity super-cycles between 1865 and 2009, each one lasting between 30 to 40 years. They find that "for non-oil commodities, the mean of each super-cycle has a tendency to be lower than that of the previous cycle." In other words, the real prices of commodities have been undulating downward for more than a century.

Erten and Ocampo also point out, "The magnitude of cumulative decline during the downward trend is 47 percent for the non-fuel commodity prices, with recent increases of around 8 percent far from compensating for this long-term cumulative deterioration." The recent upswing phase of the current super-cycle did not boost commodity prices to nearly what they were a few cycles back.

However, Erten and Ocampo report that metals have been an exception—the mean of the last cycle was higher than the preceding one. Still, they note, "The contraction phase of this cycle has not even begun yet, which can lower the mean of the whole cycle in the upcoming years." It now appears that commodity prices were just reaching their pinnacles when Erten and Ocampo were writing up their results back in 2011. Instead of peak resource production we are most likely now past peak commodity prices—and heading lower for at least for the next ten to fifteen years.

NEXT: You Want to Know Who Benefits from the Ex-Im Bank? Not Small Businesses.

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  1. The idea of peak anything in non-renewables is ridiculous. Considering the actual size of our planet, and that all of human mining thus far has literally only scratched the surface, we aren’t even remotely close to running out of anything.

    1. You have to understand that so many of these chicken littles suffer from what I call the Scale Fallacy. They are incapable of understanding time, distance, or volume that is far greater than anything they’ve personally experienced. These are the people who think that because there is a smokestack out their window belching smoke, that that alone is poisoning the atmosphere. Because they literally have no comprehension of actually how massive the atmosphere is. They think that global temperature fluctuating a few degrees over 50 years is Armageddon, because they have no comprehension of actually how old the Earth is, and how much it has gone though in those billions of years. They can only understand human-level scales, and this causes them to think very stupidly about anything that is actually outside that small metric. They are, essentially, incredibly limited thinkers and everything they worry about or advocate for is a product of that.

      1. “they have no comprehension of actually how old the Earth is, and how much it has gone though in those billions of years”

        Yeah, major impact events have changed the climate how many times?

      2. Since I’ve taken up astronomy more seriously (bought a big boy scope, etc.) my appreciation for the scale of time and space has increased considerably.

        I wish more people would have a chance to view things like the Orion Nebula or other outside-our-solar system type astronomical highlights because it would force them to come to terms with the vastness of the universe and the time involved for all of this stuff to have played out.

        I particularly enjoy when I show someone Orion that since it’s around 1300 light years away, that means the light we are looking at is 1300 years old, and more importantly if someone looks at the Nebula in say, 2000 years from now, it will look different than it does now. That always seems to help break down the scale fallacy well.

        1. Even if you can break through a little bit with examples like that, people like this still can’t really comprehend. And honestly, that’s not really their fault. It’s pretty normal for humans to think in human scales. But because it’s so common it really causes problems when people who just cannot break out of it try to “solve” problems or whatnot.

          1. What we need is a Total Perspective Vortex.

            1. +1 Zaphod Beeblebrox

                1. +3 Fairy cake

          2. Since I’ve taken up astronomy more seriously (bought a big boy scope, etc.) my appreciation for the scale of time and space has increased considerably.

            My ‘Aha’ moment was in college econ. class when a prof explained that an acre has no linear dimensions as it was traditionally the area that one man, one ox, and one plow could till in one day.

            Barely 20 yrs. old, I had done what amounted to between a couple and several of lifetimes’ worth of tilling (both in the tractor and on foot) at that point less than two lifetimes after people stopped using one man, one ox, and one plow…

            1. And I was one of probably 25-50 guys in the lecture (one of three) who were in similar situations.

        2. I recall watching one of those “Universe” shows (or some such title, I don’t remember exactly) where they were talking about black holes.

          They said in order for the earth to equal the same density of matter that exists in a supermassive black hole, it would have to be crushed down to the size of a golf ball.

          How’s that for scale?

      3. You are exactly right. Just like all the people I have met who believe in over-population either live in cities and/or have never walked any significant distance (like between two cities), where it becomes glaringly obvious even in relatively heavily populated areas like the Midwest, let alone sparse area like the West, just how much uninhabited space there actually is.

    2. EARTH FIRST!
      We’ll mine the other planets later.

      /Seen at Climax mine in CO.

      1. I want one of those.

        One of my other fave ‘t shirts’ was
        STOP PLATE TECTONICS

      2. I had this as a bumper sticker decades ago.

      3. Have seen that with loggers except that they will log the other planets later.

        1. What about the classic:

          186,000 miles/second.
          It’s not just a good idea.
          It’s the law!

          Which I first saw in the wild ~ 1970s @ SF conventions.

          Kevin R

    3. And even if some resources are practically limited, there really won’t be peak anything in the disastrous way some people predict.
      Take oil as an example. If we get to a point where oil production can’t grow further, market pricing will cause people to seek alternatives to oil and what oil there is will be used for things for which there is no good economical substitute.

      1. Take oil as an example. If we get to a point where oil production can’t grow further, market pricing will cause people to seek alternatives to oil and what oil there is will be used for things for which there is no good economical substitute.

        Not to mention that as oil reserves deplete gradually and prices rise gradually as production slows, Americans will have fewer sons/daughters and Sultans will produce fewer Princes/Princesses.

        The only way a catastrophe happens is if somebody invents the oil equivalent of Ice-9.

        1. Shit, even then, we’d just burn solid petroleum.

    4. Oh and this post is an actual proper FIRST! bitches.

    5. I’ve made $64,000 so far this year working online and I’m a full time student. I’m using an online business opportunity I heard about and I’ve made such great money. It’s really user friendly and I’m just so happy that I found out about it. Heres what I’ve been doing,
      http://www.jobfinder247.com

  2. It is because they either can’t or refuse to understand the corrective powers of the market. Their belief that high prices will remain forever is just the flip side of their belief in liquidity traps. The problem with Keynsian economics is that it does not account for the fact that the boundary of a given price function is always going to be greater than zero. To put it in less technical terms, prices don’t fall forever. Eventually they get so cheap even the most conservative hoarder starts to buy and the cycle reverses itself. Unemployment never reaches a hundred percent because wages or to put it another way the price of labor will never reach zero.

    This is just the same kind of thinking only with rising rather than falling prices. The boundary of a price function is something less than infinity. Eventually prices get so high even the richest and laziest consumers stop using the product or find an alternative and even the worst most inefficient producers make a profit. Once this happens, demand falls and supply rises and the price falls.

    That of course doesn’t mean that you can never run out of anything. You certainly can. I just means high prices are not any kind of certain indication of this.

    1. Market corrections make no sense to the left because all they understand is force. So when prices go up or down, they assume that it’s an act of force that requires fixing by force of government. The concept of emergent order naturally arising from the voluntary and cooperative interactions between consenting adults simply does not compute because there is no force involved. Force must be involved, and it must be fixed by force of government.

      1. Market fluctuations to them is proof that there’s some evil greedy capitalist pulling the strings ergo it needs regulating.

        1. I had a similar thought.

        2. Corporations and rich people using force is the only explanation for market fluctuations.

          1. I don’t see how evil kkkorpurashuns could explain falling prices. It’s strange though, rising prices are a sign of evil. Yet they think falling prices will be the end of civilization. I guess everything has to stay exactly like it is right now. Which party was it that was afraid of change again?

            1. Falling prices mean evil corporations are forcing the little guy out of business by dumping goods on unsuspecting customers.
              Stable prices mean evil corporations are colluding to force the little guy out of business.
              Rising prices mean evil corporations are forcing customers to pay too much for goods and services.

              It’s always an act of force by the corporations requiring forceful government intervention.

              1. Stable prices means it’s a monopoly!

                1. You want to experience Peak Derp? Get an otherwise free market loving, gun toting, church-going, GOP-voting, Ahmurrican conservative farmer started on the subject of Parity.

                  Kevin R

      2. “they assume that it’s an act of force that requires fixing by force of government”

        Sounds like a fair assessment. Bailey says that the last cycle was associated with the absorbsion of China and India into the global capitalist order. That took place because of the decisions of larger and authoritarian governments. Whatever they get up to, one can safely assume force is involved.

        By the way, what is the best candidate nation or region that will drive the next cycle?

        1. Africa

          1. A lot of hopes and dreams have been dashed in Africa. European efforts to colonize the place met with utter failure.

        2. Africa? South America? The Middle East? Any where else that mostly/entirely unlivable?

    2. The problem with keynesian economics is that it tries to predict and control the whole(the economy) without giving even the slightest consideration to the parts(human behavior and trade). To keynesians, it makes no difference if I invest my money in the next Microsoft or a company that makes beer out of horse piss. It’s all investment, and all investment is lumped in to a single variable. Likewise spending, they don’t care(and generally are unable to tell the difference) if I spend $1000 on something that improves my life or the government spends it on a bridge to nowhere that nobody will use. It’s all just another variable that gets plugged into a model.

      1. Keynesian macro completely ignores micro as being irrelevant, yet macro can’t exist without micro. It fails because it ignores the foundation upon which it is based.

          1. Danke. Oh, wait. Don’t they speak Austrian in Austria?

            1. G’day mate!

              1. + 1 Foster’s

                1. I’d love to see an Austrian’s reaction after a sip of Foster’s

            2. Kind of like an evil version of our accent.

      2. That is part of it. But there is a deeper problem and that is the problem I describe. The entire system is based on the idea that if left alone the economy can spiral out of control and remain at an artificially low equilibrium if the government doesn’t intervene.

        1. Keynesian economics is nothing more than an excuse for governments to meddle in the economy. That’s it.

          I still can’t figure out how people buy into the idea. Without exception, every economic recession that was allowed to go its course without government intervention recovered very quickly, and every recession that the government has attempted to fix has dragged on and on and on.

          Yet these people insist that they are reality-based. What a joke.

          1. ” Yet these people insist that they are reality-based. What a joke.”

            Whenever a keynesian brings up “reality based” or “scientific” I have a stock two word reply. Animal spirits. IMO, there’s no quicker way of telling someone you don’t understand economics and don’t want to understand than believing that tripe.

            1. But, but, but they have like equations and stuff, while all those silly Austrian economists have is something they call “reasoning.” Everyone knows that equations are better than “reasoning.”

        2. Yes, but I think the reason for that belief is what I and Sarc alluded too. They don’t understand micro, or how people behave. In your example the reason they believe prices can fall into a death spiral is they don’t understand humans want things and they have time preferences.

          Let’s say a cup of coffee cost one dollar today. But tomorrow you think it would only be 95 cents. The vast majority of people would still get their morning coffee today. Keynesians can’t understand that. It’s like they think that everyone would acquire as much money as they could, but live like a pauper. Until they’re on their deathbed then they’d quickly buy a new car and TV.

          1. Colleges should do what mine did. Make Econ 001 micro. Econ 002 was macro. Students taking Econ just to fill out their schedule are likelier to take the micro course if they only take one. Almost everyone will work in a firm, so exposure to micro is more
            useful to a schmoe like me than macro is. I took macro also, and it arguably helps me
            resist b.s. from pols. (It helps that my micro prof was Austrian.)

            Those who learned their economics reading* Ralph Nader or the NY Times editorials probably can’t be helped.

            Kevin R

            *being generous, here.

  3. “Post Carbon Institute”

    Right up there with the “Ehrlich Accurate Predictions Institute”

    1. Post Carbon Institute?

      Are they on a mission to have carbon elimiated from the periodic table?

      We need to start rearraging the entire Universe immediately!

      1. So much for life on this planet!

      2. “We need to start rearraging the entire Universe immediately!”

        If I were creating a world I wouldn’t mess about with butterflies and daffodils, I would have started with lasers eight o’clock day one.

      3. You know what they mean. I do find people saying “carbon” all the time when they mean CO2 or hydrocarbons pretty annoying, though.

        There probably will be a time when people stop using hydrocarbons for most of their energy. But that will happen because of market forces, not because someone says we are killing the earth or something.

      4. Would you like to buy some carbon free organic cookies?

        1. Spark plugs?

      5. Post Carbs Institute
        -Atkins

    2. I love the Ehrlich quote about being a betting man. He was a betting man and so he bet Julian Simon. Julian Simon gave him what can only be described as an epic punking. It should have been the end of him and his idiot ideas.

  4. Whatever part of the supercycle upswing is China’s doing, it has far less to do with increasing efficiencies and finding substitutes and a lot more to do with misallocation of capital for political reasons.

  5. There is movement based on a paradigm with thousands of highly educated devotees whose founding father predicted that we would run out of food and resources during his lifetime. He died in 1834.

    This movement is on par with socialism in it’s inability to recognize empirical evidence over the theoretical. In other words, it’s fuckin’ dumb.

    1. Malthusians are Millerites without the ritualism. Every failed prophecy only brings the event incrementally closer to fruition.

    2. Things like population doom predictions and peak-oil predictions seem to depend on an assumption that people will not develop new technology to overcome apparent problems. Malthus could perhaps be forgiven for making that assumption. With 18th century technology and farming practices, the current population probably couldn’t be sustained. But at this point it should be obvious that people are really good at innovating their way out of problems like that.

      1. Yep. They were worried about horse poop piling up in London…then cars.

        Generally, you want a geographically concentrated energy sources that have minimal impact on arable land.

      2. “But at this point it should be obvious that people are really good at innovating their way out of problems like that.”

        The Syrian response to their drought, their worst ever measured, doesn’t impress me.

        1. Well, no one said all people in all cases get it right. But in general, over time, people figure things out. Of course there have been various ecological disasters throughout history where civilizations collapsed because they ran into a resource wall.

          1. “civilizations collapsed because they ran into a resource wall”

            You may be interested in the writing of geographer Joseph Tainter who says that civilizations collapse because their solutions no longer deliver the goods. The law of diminishing marginal returns. Places like Europe and America have long been a leader in agricultural innovation yet for some time now, crop yields have been stagnating.

            1. “Places like Europe and America have long been a leader in agricultural innovation yet for some time now, crop yields have been stagnating.”

              Yes, you ignoramus, they are ‘stagnating’ since we (1) use part of it for fuel, and (2) because we already have enough.

            2. crop yields are through the roof compared to 20 years ago. We closing in on hitting peak farm land though, well we would already be their if we weren’t forced to turn food into fuel. Very immoral thing to do.

              1. ” We closing in on hitting peak farm land though,”
                Pretty sure we’re now reducing farm land with the yields we’re getting. That could change if enough brain-deads start buying ‘organic’ which requires a ton more area, but it’s not required to feed the world.

                1. As long as you get your drinking water from downstream of a non-organic farm, have at it.

              2. Corn is still doing pretty well in the USA, but that is one crop in one place, and a heavily subsidized crop at that.

                1. “Corn is still doing pretty well in the USA, but that is one crop in one place, and a heavily subsidized crop at that.”

                  You’re an idiot.
                  There is no lack of food, and there is no lack of subsidies, either. The only places where people are hungry is where the government is screwing them out of the money to buy food.
                  We are not in any danger at all of large-scale hunger. Period.

                  1. Sevo
                    You know we have hit Peak Arugula. Admit it!

                    1. “You know we have hit Peak Arugula. Admit it!”
                      And Peak KALE!

                  2. “There is no lack of food,”

                    You are missing the point. Stagnating production is what I was talking about. And the problem of Syria is not government screwing anyone out of money to buy food. It drought, or lack of water. Water is essential for growing wheat, until recently one of Syria’s major exports.

                    1. You are so completely full of shit.

                      https://archive.today/NBJpK

                      http://www.freedom21.org/alter…..ter5b.html

                    2. “You are so completely full of shit.”

                      fraid not

                      http://www.indexmundi.com/agri…..ph=exports

                    3. The law of diminishing marginal returns. Places like Europe and America have long been a leader in agricultural innovation yet for some time now, crop yields have been stagnating.

                      Yeah, asshat, you are. I don’t really give a shit about Syria or any particular location’s mismanagement.

                      Here’s worldwide production data:

                      https://archive.today/NBJpK

                      http://www.freedom21.org/alter…..ter5b.html

                      Show me the stagnation.

                    4. “however the larger anticipated crop is not forecast to offset the reduction in Europe. ”

                      from your own FAO link I believe. You’re missing my point if you think that world-wide production is germane.

                      And you also misunderstand what I wrote about Syria. The drought is due to a lack of water. Not to any mismanagement.

                    5. mtrueman|3.14.15 @ 12:13AM|#
                      “http://www.indexmundi.com/agri…..ph=exports”{
                      Fraid so.
                      A local drought in a war-torn country is use as evidence of global food problems by lying assholes.
                      Are we clear, lying asshole?

                    6. “A local drought in a war-torn country”

                      the drought started when?

                    7. mtrueman|3.14.15 @ 12:54AM|#
                      “the drought started when?”
                      You tell me.

                    8. Check Notanotherskippy’s FAO link. Can you figure it out?

                      Science time: I predict you can’t.

                    9. mtrueman|3.13.15 @ 10:04PM|#
                      “You are missing the point. Stagnating production is what I was talking about.”
                      No, you lying sack of crap, you can’t read. I addressed exactly that.

                    10. Where. Sorry I missed it.

                    11. mtrueman|3.14.15 @ 12:14AM|#
                      “Where. Sorry I missed it.”

                      Yes you did, Try reading.

                    12. ” Try reading.”

                      You offer little by way of incentive.

                    13. mtrueman|3.14.15 @ 12:56AM|#
                      “You offer little by way of incentive.”
                      I offer little to ignoramuses.

                    14. mtrueman|3.14.15 @ 12:14AM|#
                      BTW, I would appreciate it if you removed the link to your pathetic web site from your handle. I sometimes make the mistake of clicking on on it and find myself staring at the gobbledygook you post there.
                      Besides which, I’d rather not add a click to the two or so you got today.
                      Thanks.
                      Oh, and please get and stay lost.

                    15. Oh, and:

                      “And the problem of Syria is not government screwing anyone out of money to buy food. It drought, or lack of water. Water is essential for growing wheat, until recently one of Syria’s major exports.”

                      Why, look there! A local drought! Never happened before in the history of, well as far back as the admitted liar’s memory goes!

                    16. “Never happened before in the history”

                      Exactly, a drought of unprecended severity.

                    17. mtrueman|3.14.15 @ 12:17AM|#
                      “Exactly, a drought of unprecended severity.”

                      Prove it. Or STFU.

                    18. “Prove it.”

                      I leave the tedium to those who deserve it.

                    19. mtrueman|3.14.15 @ 12:59AM|#
                      “I leave the tedium to those who deserve it.”
                      So you are again lying. OK.

                    20. I left that for you to prove. I predict you won’t. How’s that for science?

                2. Oh, and regarding your prophet of doom, please tell us one non-trivial prediction he’s made which has come true.
                  And make sure the prediction has a specific time, not ‘some time soon’, and a measurable result.
                  Just one.

                  1. “Oh, and regarding your prophet of doom”

                    As I mentioned, he’s a geographer, you want predictions maybe consult your neighbourhood fortune teller.

                    Read his book if you have any interest in the subject. It was long ago that I read it, and I don’t feel confident in relating what predictions he made. Scholars tend to shy away from prognosticating, and he’s no different.

                    It’s not a long book, written with the lay man in mind, and almost certainly availble on the Internet without having to buy it. If you need help, I can probably find a torrent link for you.

                    1. mtrueman|3.13.15 @ 10:34PM|#
                      “As I mentioned, he’s a geographer, you want predictions maybe consult your neighbourhood fortune teller. It was long ago that I read it, and I don’t feel confident in relating what predictions he made. Scholars tend to shy away from prognosticating, and he’s no different.”

                      I’m sure this is a surprise to you, but scientists live or die on the accuracy of their predictions. Bullshitters make up bullshit. And those who post bullshit predictions by others are bullshitters
                      Get lost and stay lost.

                    2. ” but scientists live or die on the accuracy of their predictions”

                      That may be so, but how is that relevant to what we are talking about? Why do you always get so confused? I never claimed Tainter was a scientist. He probably doesn’t even wear a white coat.

                    3. “That may be so, but how is that relevant to what we are talking about?”

                      Do you read what you post?
                      Here, douchebag; this is what you posted:
                      “You may be interested in the writing of geographer Joseph Tainter who says that civilizations collapse because their solutions no longer deliver the goods.”
                      You see, you claim this guy makes certain claims about civilizations, presuming warnings to us (predictions), else why would you post it?
                      It’s not that you get confused, it’s that you’re an ignoramus who posts worthless crap. Please go away and stay away.

                    4. “else why would you post it?”

                      I thought it was clear. Zeb said that civilizations collapse because they hit a resource wall. I recommended he look into Tainter who has a different idea.

                      Instead of wasting more time, have a look for yourself. Here’s a link to the pdf.
                      http://monoskop.org/images/a/a…..ieties.pdf

                    5. Why would I waste time on a bullshit artist who makes wild guesses? That would be your specialty.

                    6. “Why would I waste time”

                      You excel in it. You’ve been blessed with time and a knack for wasting it.

                3. Oh, and here, for your reading pleasure:
                  http://ycharts.com/indicators/…..world_bank

            3. That is not what Tainter concludes in his book.

              The problem is the overhead of central authority and administration becomes so burdensome, that the system cannot be maintained in the face of alternatives.

              1. “The problem is the overhead of central authority and administration becomes so burdensome”

                That’s certainly part of the problem, but Tainter also says that diminishing marginal returns also apply to technical solutions – adding more fertilizer to soil will only increase productivity up to a point, after which it may even be damaging. It is also a matter of costs. To clean the effluent of a food processing factory to some point costs so much. To double the cleaning means much more than doubling the cost, Both your bureaucratic example and mine are examples of gridlock, in my view, what happens when systems become overly complex.

                You think this is bullshit? I get the impression that most here believe you can’t have too many connections, no network can be too complex. Connections mean choice and choice means freedom.

                1. “I get the impression that most here believe you can’t have too many connections, no network can be too complex.”

                  Could be, but more importantly the impression is that you’re a proven liar who kicks up dust and claims it’s hard to see.

  6. I think the Latin term ‘animo sentimus’ (we feel in our hearts) applies here. They don’t realize they’re suspending reason for the animo sentimus.

    1. Some don’t realize. Some just don’t care. Some realize and see it as a feature, not a bug.

      And my favorite Latin phrase applies to all of them.

      Seize this honkus!

      1. “Some don’t realize. Some just don’t care. Some realize and see it as a feature, not a bug.”

        We’ve seen this recurring throughout the history of the world.

  7. I’ve posted this before, but IG Farben started on syn-fuels in the 1920s, since the world was “nearly out of oil”. Natch, the price spike lead to the development of huge fields in TX and other places, leaving IG F with an expensive tech and no buyers.
    Until they hooked up with a guy named Hitler who saw syn-fuel as a way toward autarchy; he promised to buy all they could make as a guaranteed profit to them.

    1. Sounds like something Dr. Evil would do.

    2. This Hitler may have been on to something. I bet Amsoc and Tony would like to hear more!

  8. Stupid malthusian progs…

  9. I assume that most (if not all) of the regulars here know about “The Bet” that Erhlich lost so spectacularly.

    Maybe we can distract the Malthusian priests with some theoretical assumptions about what the Sun is going to do in a X billion years. Need to start taxing for that event right now.

  10. my co-worker’s ex-wife makes $69 /hour on the computer . She has been unemployed for ten months but last month her pay was $21452 just working on the computer for a few hours. navigate to this site………….

    ????? http://www.netjob70.com

  11. I’ve made $64,000 so far this year working online and I’m a full time student. I’m using an online business opportunity I heard about and I’ve made such great money. It’s really user friendly and I’m just so happy that I found out about it. Heres what I’ve been doing,

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  12. I highly recommend Jeremy Gratham’s great letters on resources. The cheap resources are very much running out, and things will be gettting more and more expensive. In particular are supplies of non renewable things like Potash are a problem.

    Register at his site (GMO.com) and read through. You will learn something about both resources and investing

    http://www.businessinsider.com…..011-4?op=1

    1. Kroneborge|3.13.15 @ 4:24PM|#
      “I highly recommend Jeremy Gratham’s great letters on resources. The cheap resources are very much running out, and things will be gettting more and more expensive”

      Thank you, Mr. Ehrlich, for your predictions!
      Did you RTFA?

      1. I invite any altruistic Malthusians to emulate the attendees of the Woodchuck Festival of Peace, Love and Death.

        Kevin R

      2. Actually if you read Gratham’s letter, you find out that Ehrilch would have won the bet after all in a few years.

        But why read something outside your comfort zone. Especially by someone that’s made billions analyzing and investing on this stuff.

        1. Kroneborge|3.14.15 @ 8:37PM|#
          “Actually if you read Gratham’s letter, you find out that Ehrilch would have won the bet after all in a few years.”
          So IOWs, he lost?

        2. Oh, and:

          “But why read something outside your comfort zone. Especially by someone that’s made billions analyzing and investing on this stuff.”

          Market timing works, except when it doesn’t. Sorta like winning in Vegas.
          That’s why.

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  14. I’ve made $64,000 so far this year working online and I’m a full time student. I’m using an online business opportunity I heard about and I’ve made such great money. It’s really user friendly and I’m just so happy that I found out about it. Heres what I’ve been doing,
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  16. my neighbor’s step-sister makes $68 an hour on the internet . She has been fired for 8 months but last month her pay check was $12106 just working on the internet for a few hours. check here…………………..

    http://www.Jobsyelp.com

  17. If everything was “peaking” when prices were going up; what does it mean when they are coming down?

    I ask this of gold standard obsessives who say that we’ve reached “peak fiat money.” If rising gold prices signal dollar failure, then declining gold prices have to signal dollar sustainability.

    1. The dollar remains only through legal tender laws which force an exchange partner to accept a media of exchange against their will. If fiat money was so great, it wouldn’t need to be forced upon individuals at gunpoint. Throughout history, govt’s have debased coinage, and decoupled “paper money” from being backed by commodities. Folks have been threatened with fines and imprisonment when FDR issued his executive order to confiscate people’s gold. The denarius was debased to junk metal also.

      If you wish to use what is essentially Monopoly money backed by the “full faith and credit” of criminals in fancy suits and pantsuits do so by your lonesome. Such a media of exchange is in no way stable.

      Someone in poverty, if paid in silver equaling the weight of four 1963 quarters (90% silver quarter) for every dollar of 11,700 dollars (poverty rate) these individuals would have a purchasing power in excess of 100,000 dollars. They wouldn’t be in poverty. Someone making just 30,000 dollars (converted to silver) would have purchasing power in excess of 320,000 dollars. So in one year, an individual could purchase a home.
      The amount of theft that has taken place is despicable. Yet sheep like you keep cheering on these douchebags and their fiat money, while attempting to degrade folks that wish to no longer be robbed and utilize the best media of exchange to prevent it from happening to them.

  18. Looks like Paul Ehrlich owes Julian Simon another $600.

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