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We must distinguish between the oft-lauded creative destruction of what is obsolete and destruction in pursuit of fleeting fashion.

I recently received an insightful email from a reader who had come across my archives of free-lance articles and essays on home and urban design. I wrote dozens of articles for S.F. Bay Area newspapers from 1988 to 2006, and a handful are listed here.

The one the reader is responding to is Best Remodel Might Be None At All (2006). Here are the reader’s comments:

“I thoroughly enjoyed the articles you penned for the SF Examiner that you’ve linked to on your website, these being written close to two decades ago.

Especially noteworthy was your response to the homeowner inquiring about a kitchen remodel where you recommended that the best course of action might be no course of action. This was an wonderful response and it caught my attention because it belies the common sales oriented suggestions generally offered by those writing about remodeling, and especially about kitchens. Usually you see writers busy extolling the gutting and replacement of a kitchen with wild zeal talking about how wonderful it will be to pour coffee or to butter toast once the kitchen area has been refurbished… and how in the sheer pleasure of a new kitchen you might even choose to drink two cups of coffee just for the fun of it!

In the old craftsman style house or bungalow it would mean new plumbing and upgrading the electrical wiring to go with new appliances and new cabinetry.

In the era when that house was constructed the cabinets were typically built on site, matching the cabinetry to the design and work flow of the kitchen.

…click on the above link to read the rest of the article…

Where Will The “Pending” Financial Crisis Originate?

January 14, 2019

Where Will The “Pending” Financial Crisis Originate?

– Case for a pending financial collapse is well grounded warns Rickards
– “Ticking time bomb” the Federal Reserve has created is set to go off…
– Economist warns U.S. high-yield debt, default of “junk bonds” could cause next crisis
– Systemic risk is “more dangerous than ever” as “entire system is larger than before”
– Protect wealth by allocating at least 10% of assets in physical gold and silver

Source: BofA Merrill Lynch via Marketwatch.com

from The Daily Reckoning:

The case for a pending financial collapse is well grounded. Financial crises occur on a regular basis including 1987, 1994, 1998, 2000, 2007-08.

That averages out to about once every five years for the past thirty years. There has not been a financial crisis for ten years so the world is overdue. It’s also the case that each crisis is bigger than the one before and requires more intervention by the central banks.

The reason has to do with the system scale. In complex dynamic systems such as capital markets, risk is an exponential function of system scale. Increasing market scale correlates with exponentially larger market collapses.

This means a market panic far larger than the Panic of 2008.

Today, systemic risk is more dangerous than ever because the entire system is larger than before.

Due to central bank intervention, total global debt has increased by about $150 trillion over the past 15 years. Too-big-to-fail banks are bigger than ever, have a larger percentage of the total assets of the banking system and have much larger derivatives books.

Each credit and liquidity crisis starts out differently and ends up the same. Each crisis begins with distress in a particular overborrowed sector and then spreads from sector to sector until the whole world is screaming, “I want my money back!”

…click on the above link to read the rest of the article…

The Two Paths to Collapse

November 25, 2018

The Two Paths to Collapse

The very structure of our systems guarantees their failure once conditions change beyond their limited ability to adjust.

As a general rule, there are two paths to collapse: gradual erosion and sudden crash. The two are intertwined, of course; in most cases, the system slowly loses vigor, resources, efficiency, etc. (erosion) which leaves it so weakened that a crisis that would have easily been overcome in the past triggers a catastrophic decline of production and order.

My new book explores these system dynamics in the present: Pathfinding our Destiny: Preventing the Final Fall of Our Democratic Republic. As the title suggests, we’ve got a window to prevent the final descent, but it’s years, not decades.

There are two basic drivers of systemic erosion, drivers that have little to do with leadership or policy. Our current delusion is that changing leaders and tweaking policies are enough to stave off systemic erosion, decline and collapse, but the two dynamics cannot be so easily thwarted.

The first is the gradual decline in the system’s ability to adapt to changing circumstances. Life’s core asset is the ability to evolve and adapt, and organisms, species and systems which fail to adapt fast enough and effectively enough to rapid change disappear.

Today’s modern complex systems are typically optimized to specific conditions, meaning that they’ve evolved (or been designed) to maximize production and output given a certain set of inputs and processes.

If those conditions shift outside the expected parameters, the system’s efficiency and output are heavily eroded. To take a real-world example: airliners are designed to cruise at specific altitudes to maximize the efficiency of the engines and aircraft design while maximizing the cruising speed.

If an airliner is forced to fly at an altitude of 500 feet instead of 35,000 feet, the optimizations are lost.

…click on the above link to read the rest of the article…

Quantum, Jazz and Dada – 3

November 16, 2018

Quantum, Jazz and Dada – 3

Max Ernst Ubu Imperator 1923

Ilargi: This is part 3 of Alexander Aston’s view of how upheaval and collapse can lead to new insights, new bursts of creativity, in science, religion, society and the arts. Part 1 of Quantum, Jazz and Dada can be found here, part 2 is here.

Here’s Alexander:

Quantum, Jazz and Dada:
The Dynamic Symmetry of Destruction and Creativity

Human Development

“Every breath is a sacrament, an affirmation of our connection with all other living things, a renewal of our link with our ancestors and a contribution to generations yet to come. Our breath is a part of life’s breath, the ocean of air that envelopes the earth.”
– David Suzuki

As human minds first started to emerge from the ocean and step onto the shores of Africa, they increasingly began to respond to their own presence. Hominids co-evolved through the complex social structures generated through the ecosystem engineering of tool using communities, forming a kind of “multicellular” cognition. The unique features of human cognitive evolution emerged from the dense feedback between brains, bodies, and their environments. As humans learn to engage with the material world around us we transform our collective developmental processes. “The structure of the brain reflects its history: as an evolving dynamic system, in which one part evolves out of another”. (20)

Tools made available whole new energetic niches for early hominins while sharing and cooperation increased group resiliency. This stimulated the growth of new neural structures capable of mediating the growing complexity of hominin interaction with the world. It is from these socio-cognitive ecologies that the phenomena we call history has emerged. What is clear from our deep past is that cooperative behaviour is overwhelmingly the dominant evolutionary characteristic of our species.

…click on the above link to read the rest of the article…

Quantum, Jazz and Dada – 2

November 12, 2018

Quantum, Jazz and Dada – 2

Hannah Höch Cut with the Dada Kitchen Knife through the Last Weimar Beer-Belly Cultural Epoch in Germany 1919

Ilargi: This is part 2 of Alexander Aston’s view of how upheaval and collapse can lead to new insights, new bursts of creativity, in science, religion, society and the arts. Part 1 of Quantum, Jazz and Dada can be found here. Part 3 will follow soon. Check TheAutomaticEarth.com.

Here’s Alexander:

Quantum, Jazz and Dada:
The Dynamic Symmetry of Destruction and Creativity

Energy, Ecology and Ecosystems

“Erwin Schrodinger (1945) has described life as a system in steady-state thermodynamic disequilibrium that maintains its constant distance from equilibrium (death) by feeding on low entropy from its environment – that is, by exchanging high-entropy outputs for low-entropy inputs. The same statement would hold verbatim as a physical description of our economic process. A corollary of this statement is that an organism cannot live in a medium of its own waste products.”
– Herman Daly and Kenneth Townsend

The concept of energy is essentially an accounting process we have devised for describing the relationships of flow and transformation observed in the fundamental structure of the universe. It is an elegant concept, whether discussing the life of stars, the feeding of bodies or the intensity of industries, the movement of energy is remarkably consistent. In other words, it is very hard to lie about. It has one key characteristic in its movement through systems, the creation of feedback between material structures. Matter congeals from energy, planets and the basic chemical elements of life originate in novae, bronze is forged with fire and earth.

Positive feedback structures the growth of energetic systems and negative feedback shapes their stability. Stars and atmospheres remain balanced between gravity and the void, bodies respire, species co-evolve, ecological cycles persist. A self-similar pattern begins to becomes apparent in the flows of energy and matter through our universe.

…click on the above link to read the rest of the article…

Connected and vulnerable: Climate change, trade wars and the networked world

November 12, 2018

Connected and vulnerable: Climate change, trade wars and the networked world

The increasing connectedness of the global economic system has long been touted as the path to greater prosperity and peaceful relations among nations and their peoples. There’s just one hitch: Complex systems have more points of failure and also hidden risks that only surface when something goes wrong.

For example, our dependence on cheap shipping to move commodities and finished goods has resulted in a system vulnerable to environmental disruption, particularly climate change, and to rising political and military tensions.

The extreme drought in Germany last summer, the warmest ever recorded in the country, has resulted in such low water in the Rhine River that shipping has been greatly curtailed. Ships can only be loaded lightly so as to avoid running aground. Consequently, many more barges and other vessels have been pressed into service to carry the lighter but more numerous loads along the river. This has driven up the cost of shipping considerably. In addition, fuel tankers have not been able to reach some river ports resulting in scattered fuel shortages. Some industrial installations along the river have had to reduce operations.

The natural inhabitants of the river have also suffered as die-offs of fish and other marine life have spread along the river.

A world away trade tensions between China and the United States are resulting in an unexpected threat to the preparedness of the U.S. military. The neoliberal program of free trade embraced by one U.S. president after another regardless of party has resulted in curious vulnerabilities for the military.

Because of the hollowing out of American manufacturing—as much of it migrated to China’s low-cost labor market—the military can no longer fulfill certain needs from U.S. or even European manufacturers. Instead, the only place to source certain supplies is China, a country many now consider a potential military adversary of the United States.

…click on the above link to read the rest of the article…

Quantum, Jazz and Dada – 1

November 9, 2018

Quantum, Jazz and Dada – 1

Marcel Duchamp Nude descending a staircase 1912

Ilargi: Much to my surprise, I received a mail from an old friend. Alexander Aston last wrote for the Automatic Earth in 2014. But he hasn’t been idle. Alexander is presently finishing his doctorate in archeology at Oxford, after prior degrees in philosophy and history. And for this article, he’s been thinking about how upheaval and collapse tend to lead to new insights, new bursts of creativity, in science, religion, society and the arts. A view that’s -too- rarely contemplated. It’s so long I cut it into three parts. Please don’t miss any of them.

Here’s Alexander:

Quantum, Jazz and Dada:
The Dynamic Symmetry of Destruction and Creativity

“Do not now seek the answers, which cannot be given to you because you would not be able to live them. And the point is, to live everything. Live the questions now. Perhaps you will then gradually, without noticing it, live along some distant day into the answer.”
– Rainer Maria Rilke

Introduction

This paper is not about Quantum, Jazz and Dada per se, but rather a meditation on those radical bursts of human creativity that occur during historically destructive moments. Ultimately, my thesis is quite simple. Barring the possibility of extinction, humans are on the precipice of the most radical social reorganizations in the history of the species. In navigating this process of transformation, if we wish to create a world worth living in, it is necessary to understand the interactions between energy, ecosystems, cognitive development and social organization.

Without a grasp on the interdependence of these relationships there is no hope for shaping our world in a healthier manner. What is historically unquestionable is that periods of radical upheaval result in drastic reconfigurations of belief, meaning and knowledge.

…click on the above link to read the rest of the article…

Why Economists Can’t Understand Complex Systems: Not Even the Nobel Prize, William Nordhaus

October 16, 2018

Why Economists Can’t Understand Complex Systems: Not Even the Nobel Prize, William Nordhaus

The “base case” scenario of “The Limits to Growth” 1972 report to the Club of Rome. The strong non-linearity of the behavior of complex systems — including the global economy — is nearly impossible to understand for people trained in economics. William Nordhaus, the recent Nobel prize winner in economics, is no exception to the rule. In this post, I’ll report how, at the beginning of his career, Nordhaus criticized “The Limits to Growth”, showing in the process that he had understood nothing of the way complex systems work.

After having been awarded the Nobel prize in economics of this year, William Nordhaus has been often presented as some sort of an ecologist (see, e.g. this article on Forbes). Surely, Nordhaus’ work on climate has merit and he is one of the leading world economists who recognize the importance of the problem and who propose remedies for it. On the other hand, Nordhaus’ approach on climate can be criticized: he tends to see the problem in terms of costs and solvable just by means of modest changes.

Nordhaus’ approach to climate change mitigation highlights a general problem with how economists tend to tackle complex systems: their training makes them tend to see changes as smooth and gradual. But real-world systems, normally, do what they damn please, including crashing down in what we call the Seneca Effect.

On this point, let me tell you a little story of how Nordhaus started his career at Yale by an all-out attack against system dynamics, the method used to prepare the 1972 study “The Limits to Growth,” showing in the process that he had understood nothing on the way complex systems work.

…click on the above link to read the rest of the article…

When Long-Brewing Instability Finally Reaches Crisis

July 26, 2018

When Long-Brewing Instability Finally Reaches Crisis

Keep an eye on the system’s buffers. They look fine until they suddenly collapse.

The doom-and-gloomers among us who have been predicting the unraveling of an inherently unstable financial system appear to have been disproved by the reflation of yet another credit-asset bubble. But inherently unstable / imbalanced systems can stumble onward for years or even decades, making fools of all who warn of an eventual reset.

Destabilizing systems can cling on for decades, as the inevitable crisis doesn’t necessarily resolve the instability. History shows that when systems had enough inherent wealth to draw upon, they could survive for centuries, thinning their resources, adaptability and buffers until their reservoirs were finally drained. Until then, they simply did more of what’s failed to maintain the sclerotic, self-serving elites at the top of the Imperial food chain.

If we want to trace back the systemic instabilities and imbalances that culminated in China’s revolution in 1949, we can start in 1900 with the Boxer Rebellion, which was itself a reaction to the Opium Wars of the 1840s that established Western influence and control in China.

But is this far enough back in time to understand the Communist Revolution in the 1940s? If we want a comprehensive understanding, we must go back to 1644 and the demise of the Ming Empire, and perhaps even farther back to the Mongol victory over the Song dynasties in the late 1200s.

In the same fashion, we can trace the current crisis of global-finance Capitalism back to the expansion of globalization, affordable fossil fuels and credit in the early 1900s. Affordable fossil fuels enabled rapid industrialization and the growth of transportation and communication networks. Add the expansionary effects of globalization and credit, and the consumer-finance economy took off like a rocket until the inevitable consequences of providing leverage and credit to marginal producers, buyers and speculators led to the Great Depression.

…click on the above link to read the rest of the article…

Population growth and food: A systems perspective

July 12, 2018

Population growth and food: A systems perspective

In this age of the Anthropocene, it is necessary to look inward as well as outwards to find systemic solutions. People may or may not be “a plague on earth” as David Attenborough has stated, but we are without doubt the dominant force on this planet. Some introspection is needed if we are to use our power ethically.

As Organisational Outreach Officer for Population Matters, my task is to contact ethically-oriented organisations (from faith organisations to environmental NGOs) and suggest ways in which the issue of population growth could be covered on their website and integrated into their ethos. Many organisations I approach agree that population size contributes to climate change, conflict and malnutrition, but they frequently respond by saying that the issue lies outside of their remit. Population Matters’ patron Jonathon Porritt talks about the reasons why organisations avoid referencing population growth in this 14-minute video, debunking a few myths along the way.

To be truly systemic, one has to include all aspects of the problem. So what is ‘systemic’ or ‘systems thinking’? In simple terms, it is an approach for analysing complex issues by viewing them holistically, as purposeful systems containing interdependent variables, stakeholders and perspectives. This allows an awareness of one’s own bias and limitations. Systems practitioners use simplified diagrams to uncover key issues and when this is done comprehensively they are able to see the interwoven social, economic, political and environmental dimensions.

The issue under investigation here is the global food system, the purpose of which is to feed humans (and to a certain extent livestock) over a sustained period of time. It is embedded in and dependent on ‘macro’ systems as shown in the diagram below.

…click on the above link to read the rest of the article…

The Most Intolerant Wins: The Dictatorship of the Small Minority

July 9, 2018

The Most Intolerant Wins: The Dictatorship of the Small Minority

(Chapter from Skin in the Game)

How Europe will eat Halal — Why you don’t have to smoke in the smoking section — Your food choices on the fall of the Saudi king –How to prevent a friend from working too hard –Omar Sharif ‘s conversion — How to make a market collapse

The best example I know that gives insights into the functioning of a complex system is with the following situation. It suffices for an intransigent minority –a certain type of intransigent minorities –to reach a minutely small level, say three or four percent of the total population, for the entire population to have to submit to their preferences. Further, an optical illusion comes with the dominance of the minority: a naive observer would be under the impression that the choices and preferences are those of the majority. If it seems absurd, it is because our scientific intuitions aren’t calibrated for that (fughedabout scientific and academic intuitions and snap judgments; they don’t work and your standard intellectualization fails with complex systems, though not your grandmothers’ wisdom).

The main idea behind complex systems is that the ensemble behaves in way not predicted by the components. The interactions matter more than the nature of the units. Studying individual ants will never (one can safely say never for most such situations), never give us an idea on how the ant colony operates. For that, one needs to understand an ant colony as an ant colony, no less, no more, not a collection of ants. This is called an “emergent” property of the whole, by which parts and whole differ because what matters is the interactions between such parts. And interactions can obey very simple rules. The rule we discuss in this chapter is the minority rule.

…click on the above link to read the rest of the article…

Chasing the Wind

June 17, 2018

Chasing the Wind

Futility with Purpose

Plebeians generally ignore the tact of their economic central planners. They care more that their meatloaf is hot and their suds are cold, than about any plans being hatched in the capital city. Nonetheless, the central planners know an angry mob, with torches and pitchforks, are only a few empty bellies away. Hence, they must always stay on point.

Watch for those pitchfork bearers – they can get real nasty and then heads often roll quite literally. [PT]

One of the central aims of central planners is to achieve effective public exhortation. While they pursue futility, in practice. They must do so with focus and purpose.

For example, economic reports with impressive tables and charts, including pie graphs, are important to maintaining the requisite public perception. Central planners know that financial scientism must always be employed as early and often as possible.

Statistics, with per annum projections, particularly those that show increasing exports and decreasing imports, are critical to maintaining the proper narrative. The USA’s embarrassing deficit in the balance of international payments will certainly diminish if it is sketched accordingly in an “official” report… right?

Yet the planners always disregard the simple observation that an economy is composed of countless, and variable, inputs. How is a new discovery or technology, and its effect on investment and labor, to be anticipated and forecast? How are the actions of 7 billion individuals to be modeled and displayed on a tidy diagram?

Good old Friedrich A. Hayek – depicted above – once coined the term “scientism” to describe the futile attempts of assorted social engineers and their academic advisors to express human action in the form of barren mathematical equations and statistics. Lettuce look at something one of his followers, the late Professor Austin L. Hughes, wrote in an article published in the autumn 2012 issue of “The New Atlantis” journal:

…click on the above link to read the rest of the article…

The Current Onset of Climate Tipping Points

March 7, 2018

The Current Onset of Climate Tipping Points

As is well known to students of the history of the climate, once a temperature threshold is breached, abrupt weather events ensue amplified by feedbacks such as decreased reflectivity of the Earth surface and enhanced release of greenhouse gases, often within short time frames.

Figure 1. 1880-2018 annual mean temperatures and 5-years smoothing.

Such abrupt changes are occurring at present. As mean global temperature has exceeded 1.2 degrees Celsius above 1880 temperatures (Figure 1), sharp reductions occur in Arctic sea ice from 45 percent in 1985 to 21 percent in 2017[i], when the ice cover was 8.5 percent lower than the average of 1981-2010[ii].

As the ice melts the near-total reflection (high albedo) of solar radiation from the ice is replaced by absorption of infrared radiation by open water; The flow of ice-melt water from the Greenland glaciers creates a large pool of cold water in the North Atlantic Ocean. The cold water region south of Greenland slows-down to aborts northward flow of the thermohaline Atlantic Meridional Ocean Circulation (AMOC), leading to cooling of the North Atlantic and adjacent North America and Europe[iii].

…click on the above link to read the rest of the article…

Too Good For Too Long

October 13, 2017

Shutterstock

Too Good For Too Long

Over-extended systems contract quickly & violently

It’s amazing how instantly the status quo where I live has changed. The world my neighbors and I lived in when we all went to bed on Sunday night simply no longer existed by the time we woke up on Monday morning. Lives have been lost. Entire neighborhoods — thousands of homes — have burned to the ground. Businesses, hospitals and schools are now shuttered.

Having now experienced this personally — on top of watching news reports over the previous weeks of similarly abrupt “before/after” transitions in Houston, Florida, Puerto Rico, Mexico City, Las Vegas and Catalonia — I have a new-found appreciation for the maxim that when it arrives, change happens quickly — usually much more quickly than folks ever imagined, catching the general public off-guard and unprepared.

We humans tend to think linearly and comparatively. In other words, we usually assume the near future will look a lot like the recent past. And it does much of the time.

But other times it doesn’t. And that’s where the danger lies.

The Cruel Math

In 1987 a Danish physicist named Per Bak released a landmark paper introducing the concept of self-organized criticality. Bak observed that complex systems draw stability through an ongoing cycle of corrective collapses that keep the overall system from becoming too over-extended.

…click on the above link to read the rest of the article…

Death to All Zombies!

July 3, 2016

Death to All Zombies!

Wait a minute. They’re already dead. Brexit just reveals that not everybody’s brains have been eaten. A viral contagion now threatens the zombified institutions of daily life, especially the workings of politics and finance. Just as zombies exist only in the collective imagination, so do these two principal activities of society operate mainly on trust, an ephemeral product of the hive-mind.

When things fall apart in stressed complex systems, they tend to fall apart fast. It’s called phase change. Too many things in 21st century life have depended on sheer trust that the people-in-charge know what they are doing. That trust has subsisted on the doling out of money-from-nothing: debt, reckless bond issuance. TARP, QEs, bailouts, bail-ins, Operation Twists, Ponzi schemes… the whole sad-ass armamentarium of banking necromancy. The politicians let it get out of hand. Things that can’t go on don’t, and now they won’t.

The politics of Great Britain are now falling apart landslide-style. Since just about everybody in or near power can be blamed for the national predicament, there’s nobody to turn to, at least not yet. The Labour party just acted out The Caine Mutiny, starring Jeremy Corbyn as Captain Queeg. The Tory Cameron gave three months notice without any plausible replacement in view. Now Cameron’s people are hinting in the media that they can just drag their feet on Brexit, that is, not do anything to enable it from actually happening for a while. Of course, that’s what the monkeyshines of banking and finance have done: postponed the inevitable reckoning with the realities of our time: growing resource scarcity, population overshoot, climate change, ecological holocaust, and the diminishing returns of technology.

…click on the above link to read the rest of the article…

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