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It wasn’t until more than a week after Hurricane Katrina slammed into New Orleans in 2005 that the full extent of the damage was recognized and so it will go with the hot mess where Houston used to be. Mostly, it is inconceivable that the business activity which made Houston the nation’s fourth largest city and, according to Chris Martenson, equal to the 10^th largest economy in the world, will ever return to what it was before August 26, 2017.

The major activity there has been the refining and distribution of oil products, and no activity is more central to the functioning of the US economy. So the public and our currently clueless leaders across the political spectrum, plus a legacy news media lost in the carnival of race and gender freak shows, is about to discover the dynamic relationship between energy and an industrial economy.

The pivot in this relationship is banking, which enables the conversion of oil’s raw power into everything else that goes on in a so-called advanced economy. The popular assumption is that federal disaster relief can compensate for all losses. That assumption may go out the window with the Houston flood of 2017. And no amount of federal aid can compensate for the hours, days, and weeks that will tick by as businesses struggle to return to something like their former level of normal operation.

Many businesses will never recover, especially the smaller ones that support the big one — the little tool and die shops, the construction outfits, the trucking and shipping concerns, the riggers and pipefitters, the cement companies, and so on. All of that activity existed in highly rationalized chains of on-time production and service and nothing will be on-time in Houston for a long time to come.

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

When the Butterfly Flaps Its Wings

August 28, 2017

When the Butterfly Flaps Its Wings

It remains to be seen what the impact will be from Mother Nature putting the nation’s fourth largest city out-of-business. And for how long? It’s possible that Houston will never entirely recover from Hurricane Harvey. The event may exceed the physical damage that Hurricane Katrina did to New Orleans. It may bankrupt large insurance companies and dramatically raise the risk of doing business anywhere along the Gulf and Atlantic coasts of the USA — or at least erase the perceived guarantee that losses are recoverable. It may even turn out to be the black swan that reveals the hyper-fragility of a US-driven financial system.

Houston also happens to be the center of the US oil industry. Offices can be moved elsewhere, of course, but not so easily the nine major oil refineries that sprawl between Buffalo Bayou over to Beaumont, Port Arthur, and then Lake Charles, Louisiana. Harvey is inching back out to the Gulf where it will inhale more energy over the warm ocean waters and then return inland in the direction of those refineries.

The economic damage could be epic. Much of the supply for the Colonial Pipeline system emanates from the region around Houston, running through Atlanta and clear up to Philadelphia and New York. There could be lines at the gas stations along the eastern seaboard in early September.

The event is converging with the US government running out of money this fall without new authority to borrow more by congress voting to raise the US debt ceiling. Perhaps the emergency of Hurricane Harvey and its costly aftermath will bludgeon congress into quickly raising the debt ceiling. If that doesn’t happen, and the debt ceiling is not raised, the federal government might have to pretend that it can pay for emergency assistance to Texas and Louisiana. That pretense can only go so far before government contractors balk and maybe even walk.

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

James Howard Kunstler: It’s Time To Be Honest With Ourselves

August 28, 2017

James Howard Kunstler: It’s Time To Be Honest With Ourselves

The major systems our society relies on are failing

The ever-eloquent James Howard Kunstler returns to our podcast this week to discuss the dangers of the ‘comprehensive dishonesty’ he observes in our culture today.

We occupy ourselves with distractions (e.g., the fear du jour that our media continually manufactures) and diversions (e.g., our empty social media addiction), while ignoring the erosion of the essential systems around us. Making matters worse, the leaders we assume are focusing on these issues aren’t or are woefully out of their depth.

It’s time for society to take a hard look in the mirror and be honest about the shortcoming it sees. Identifying them then opens the door to deciding what to do about them.

Without the courage to be honest, we condemn ourselves to a failing status quo that likely has little remaining time left:

What we’re seeing is the result of behavior of people who have no idea what they’re doing. Most of the major systems that we rely on are entering a state of failure of one kind or another. And, of course, the larger problem is that they’re interlinked, and that their failures will be mutual and self-amplifying.

These systems include the energy system that has powered industrial civilization, the oil and gas industries which you’ve talked about a lot and I think that our listeners understand pretty well — although the finer points of it, like the ‘energy return on investment’, is something that’s certainly not understood by the general public, or most of the officers in our government, and certainly not in the New York Times, Washington Post or other major media outlets. They just don’t get that.

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

Diminishing Returns

August 21, 2017

Diminishing Returns

These two words are the hinge that is swinging American life — and the advanced techno-industrial world, for that matter — toward darkness. They represent an infection in the critical operations of daily life, like a metabolic disease, driving us into disorder and failure. And they are so omnipresent that we’ve failed to even notice the growing failure all around us.

Mostly, these diminishing returns are the results of our over-investments in making complex systems more complex, for instance the replacement of the 37-page Glass-Steagall Act that regulated American banking, with the 848 page Dodd-Frank Act, which was only an outline for over 22,000 pages of subsequent regulatory content — all of it cooked up by banking lobbyists, and none of which replaced the single most important rule in Glass-Steagall, which required the separation of commercial banking from trafficking in securities. Dodd-Frank was a colossal act of misdirection of the public’s attention, an impenetrable smokescreen of legal blather in the service of racketeering.

For Wall Street, Dodd-Frank aggravated the conditions that allow stock indexes to only move in one direction, up, for nine years. During the same period, the American economy of real people and real stuff only went steadily down, including the number of people out of the work force, the incomes of those who still had jobs, the number of people with full-time jobs, the number of people who were able to buy food without government help, or pay for a place to live, or send a kid to college.

When that morbid tension finally snaps, as it must, it won’t only be the Hedge Funders of the Hamptons who get hurt. It will be the entire global financial system, especially currencies (dollars, Euros, Yen, Pounds, Renminbi) that undergo a swift and dire re-pricing, and all the other things of this world priced in them. And when that happens, the world will awake to a new reality of steeply reduced possibilities for supporting 7-plus billion people.

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

Battle of the Behemoths

August 11, 2017

Battle of the Behemoths

As the empire deliquesces into a fetid slurry of economic failure, we stand ankle deep in the rising swamp waters witnessing the futile battle of the giants, Walmart and Amazon.

Neil Howe, co-author of The Fourth Turning, wrote this week that “[t]he Amazon-Walmart rivalry will determine the future of retail.” Well, it seems that way, perhaps, and I understand why a lot of people would imagine it, but I would draw some different conclusions. What we’re seeing is more like the battle between Godzilla and King Kong, two freaks of nature produced by a toxic culture, fixing to finish each other off.

The condition that will flavor events going forward is scale. Everything organized at the giant scale is going to fail. We have made all the systems of daily life too large and they will not function in the long emergency (and the fourth turning), an age characterized by universal contraction. This is true of corporations, institutions, schools, hospitals, farms, governments, virtually all organized enterprise. Retail is currently just the most visible example at the moment, since it is a commercial battleground that doesn’t enjoy public subsidies. The organisms on that field are exquisitely sensitive to economic reality, and the salient reality these days is the impoverishment of their customers, the former middle class.

This has been a sensational year for retail failure so far with a record number of brick-and-mortar store closings. But it is hardly due solely to Internet shopping. The nation was vastly over-stored by big chain operations. Their replication was based on a suicidal business model that demanded constant expansion, and was nourished by a regime of ultra-low interest rates promulgated by the Federal Reserve (and its cheerleaders in the academic econ departments).

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

We’re Good People, Really We Are!

July 10, 2017

We’re Good People, Really We Are!

The disgrace of America’s putative intellectual class is nearly complete as it shoves the polity further into dysfunction and toward collapse. These are the people Nassim Taleb refers to as “intellectuals-yet-idiots.” Big questions loom over this dynamic: How did the thinking class of America sink into this slough of thoughtlessness? And why – what is motivating them?One path to understanding it can be found in this sober essay by Neal Devers, The Overton Bubble, published two years ago on TheFuturePrimaeval.net — a friend turned me on to it the other day (dunno how I missed it). The title is a reference to the phenomenon known as the Overton Window. Wikipedia summarizes it:

The Overton Window, also known as the window of discourse, is the range of ideas the public will accept…. The term is derived from its originator, Joseph P. Overton (1960–2003), a former vice president of the Mackinac Center for Public Policy….

Devers refines the definition:

The Overton Window is a concept in political sociology referring to the range of acceptable opinions that can be held by respectable people. “Respectable” of course means that the subject can be integrated with polite society. Respectability is a strong precondition on the ability to have open influence in the mainstream.

This raises another question: who exactly is in this corps of “respectable people” who set the parameters of acceptable thought? Primarily, the mainstream media — The New York Times, The WashPo, CNN, etc. — plus the bureaucratic functionaries of the permanent government bureaucracy, a.k.a. the Deep State, who make and execute policy, along with the universities which educate the “respectable people” (the thinking class) into the prevailing dogmas and shibboleths of the day, and finally the think tanks and foundations that pay professional “experts” to retail their ideas.

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

Blood Sports

May 12, 2017

Blood Sports

What you’re seeing in the political miasma of “RussiaGate” is an exercise in nostalgia. Apart from the symbolic feat of getting a “black” president freely elected in 2008 (remember, Mr. Obama is also half-white), the Democratic Party hasn’t enjoyed a political triumph in half a century to match the Watergate extravaganza of 1972-74, which ended in the departure of Mr. Nixon, the designated Prince of Darkness of those dear dead days. Watergate had had a more satisfying finale than The Brides of Dracula.

So, in its current sad state, devoid of useful political ideas, mired in the mostly manufactured conflicts of race and gender, psychologically crippled by the election loss of a miserable candidate to the Golden Golem of Greatness, the Democratic Party is returning full steam to a gambit that worked so well years ago: beating the devil by congressional inquiry.

In President Trump (uccchhh, the concept!), they’ve got a target much juicier even than Old Nixie. It wasn’t for nothing that they called him “Tricky Dick.” He came back from political near-death twice in his career. The first time, running as Dwight Eisenhower’s veep, he was accused of accepting the gift of a vicuna coat for his wife, Pat, and other secret cash emoluments. He overcame that with one of the first epic performances of the TV age, the “Checkers Speech” — Checkers being the family’s cocker spaniel, who Nixon invoked as a proxy for his own guileless innocence. It worked bigly.

The second near-death was his defeat in the California governor’s race of 1962, following his 1960 squeaker presidential election loss to John F. Kennedy. “You won’t have Nixon to kick around anymore…” he told the press. But he rose from the grave in 1968 — after fortifying his bank account in a Wall Street law practice — when the Vietnam War was tearing the country apart (and wrecking the Democratic Party of Lyndon Johnson and Hubert Humphrey).

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

The Sound of One Wing Flapping

May 1, 2017

The Sound of One Wing Flapping

And suddenly the storms of early Trumptopia subside, or seem to. The surface of things turns eerily placid as the sweets of May sweep away the toils of an elongated mud season. Somebody stuffed Kim Jong Un back in his bunker with a carton of Kools and the Vin Diesel video library. France appears resigned to Hollandaise Lite in the refreshing form of boy wonder Macron. It’s been weeks since The New York Times complained about the Russians stealing Hillary’s turn as leader of the free world. We’re given to understand that Congress managed overnight to cook up a spending bill that will avert a Government shut-down until September. Rest easy America… oh, and buy every dip.

A calm surface is exactly what Black Swans like to land on, though by definition we will not know they’re out there until our reveries are broken by the sound of wings flapping. Some kind of dirty bird showed up on Canada’s thawing pond last week when that country’s biggest home loan lender suffered a 60 percent pukage of shareholder equity and had to be bailed out — not by the Canadian government directly, but by the Ontario Province’s Health Care Workers Pension Fund, a neat bit of hocus pocus that amounts to a one-year emergency loan at ten percent interest.

If that’s a way for insolvent public employee pension plans to find enough “yield” to meet their obligations, then maybe that could be the magic bullet for the USA’s foundering pension funds. The next time Citibank, Goldman Sachs, JP Morgan, and friends get a case of the Vapors, let them be bailed out by the Detroit School Bus Drivers’ Pension Fund at ten percent interest. That ought to work. And let Calpers take care of Wells Fargo.

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

Buy the Dip?

April 17, 2017

Buy the Dip?

The military frolics of spring have distracted the nation’s attention from the economic and financial dynamics that pose the ultimate mortal threat to business as usual. Note the distinction between economic and financial. The first represents real activity in this Land of the Deal: people doing and making. The second, finance, used to be a minor branch — only about five percent — of all the doing in the days of America’s putative bigliest greatitude. The task of finance then was limited and straightforward: to manage the allocation of capital for more doing and making. The profit in that enabled bankers to drive Cadillacs instead of Chevrolets, but not much more.

These days, finance is closer to 40 percent of all the doing in America, and it is not about making anything, but getting more than its share of “money” — whatever that is now — and what “money” mostly is is whatever the people engaged in finance say it is, for instance, Fannie Mae bonds representing millions of sketchy loans for houses of vinyl and strand-board built in places with no future… or stock issued by the Tesla corporation… or the sovereign IOUs of the US Treasury.

The list of things that pretend to be “money” these days would be long and shocking and the sheer churn of these instruments among the banks and markets “produces” the fabled “revenue streams” beloved of The Wall Street Journal. What happens when the world discovers that these instruments (securities and their derivatives) represent falsely? Why, bigly trouble.

And this is the season we’re moving into as the dogwoods blaze: the season of the re-discovery of actual value. For those of you gloating over last week’s demonstrations of US Big Stick-ism, be warned that our military shenanigans have given China and Russia every reason to discipline this country by undermining the international standing of the dollar.

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

What Could Go Wrong?

April 14, 2017

What Could Go Wrong?

“Things fall apart; the center cannot hold.” Yeats wrote. The funny thing is, we didn’t seem to miss the center all that much after it was gone. America is perfectly satisfied hunkering down at the margins these days. Especially the margins of thinking.

One thing that used to occupy the center was public discussion, debate, and argumentation. Now and again, it featured a coherent exchange of ideas. These days, the main political factions are sunk in hysteria of one kind or another. Their primitive promptings hardly add up to ideas but rather limbic spasms of fear and rage. And then there is the shadow partner of the two parties called the Deep State, led by the quaintly dubbed “Intelligence Community.” These birds, many of them lifers, are dedicated to making the public discussion of anything as incoherent as possible so as to prevent any change in policy that might curtail the growth of the Deep State, a sort of cancer of the body politic.

Case in point, the recent Syrian aerial gas attack in the town of Khan Sheikhoun. Elected officials were all over the cable networks selling the NSA’s story that Syrian president Bashar Assad bombed women and children with Sarin gas three days after State Department declared that it had a new policy of letting Assad remain in power after decades of sedulously scheming to shove him out. That might have led to the end of the six-year-long Syrian civil war, which Assad seemed to be winning, finally — with Russian assistance.

But instead the incident has led to new official calls to shove Assad out… to be replaced by what…?

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

Wonderland

April 10, 2017

Wonderland

There are times in the course of events when a society cannot tell what the fuck is going on, or what to do about it, and this is one of those moments in history here in the USA. The quandaries of life on the home front — how to make a living, how to care for ourselves and loved ones — get shoved aside by misadventures in foreign lands with their own quandaries. One delusion leads to another until you enter a zero gravity of the mind. Case in point du jour: Syria.

The persistent hyperRussomania of the US Dem-Prog alliance and its sob-sisters in the media seeks to make a bad situation worse in Syria and probably for the worst reasons. How many Americans have even the dimmest idea what’s going on in Syria, who the cast of characters there represent, and where the USA fits into all of it?

There is the head of government, one Bashar al Assad (son of the previous president, Hafez al Assad). The Assads had run Syria as a mostly secular Arab state until the civil war within Islam, Sunni against Shia, spilled out of Iraq. The Assads belonged to the tiny Alawite sect of the Shia. They comprise only 13 percent of the Syrian population, which has a Sunni majority. Under the Assads, Syria has tilted toward Iran, the Shia home state, and away from the Sunni Arabs elsewhere in the neighborhood. Russia has cultivated Iran and support its “friends,” the Assads.

A mash-up of Sunni jihad armies fights the Assad government in Syria’s civil war. These are Isis, al Qaeda, and Jabhat al Nusra. The US government had made official noise about supporting the more “moderate rebels” in the Syrian conflict. Who are they exactly? Do you have a clue? Which army among those three rebel groups are “moderates?” And what is their moderate goal under jihad?

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

Musktopia Here We Come!

April 3, 2017

Musktopia Here We Come!

It ought to be sign of just how delusional the nation is these days that Elon Musk of Tesla and Space X is taken seriously. Musk continues to dangle his fantasy of travel to Mars before a country that can barely get its shit together on Planet Earth, and the Tesla car represents one of the main reasons for it — namely, that we’ll do anything to preserve, maintain, and defend our addiction to incessant and pointless motoring (and nothing to devise a saner living arrangement).

Even people with Ivy League educations believe that the electric car is a “solution” to our basic economic quandary, which is to keep all the accessories and furnishings of suburbia running at all costs in the face of problems with fossil fuels, especially climate change. First, understand how the Tesla car and electric motoring are bound up in our culture of virtue signaling, the main motivational feature of political correctness. Virtue signaling is a status acquisition racket. In this case, you get social brownie points for indicating that you’re on-board with “clean energy,” you’re “green,” “an environmentalist,” “Earth –friendly.” Ordinary schmoes can drive a Prius for their brownie points. But the Tesla driver gets all that and much more: the envy of the Prius drivers!

This is all horse shit, of course, because there’s nothing green or Earth-friendly about Tesla cars, or electric cars in general. Evidently, many Americans think these cars run on batteries. No they don’t. Not really. The battery is just a storage unit for electricity that comes from power plants that burn something, or from hydroelectric installations like Hoover Dam, with its problems of declining reservoir levels and aging re-bar concrete construction. A lot of what gets burned for electric power is coal. Connect the dots. Also consider the embedded energy that it takes to just manufacture the cars. That had to come from somewhere, too.

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

Panel Discussion with John Michael Greer, James Howard Kunstler, Chris Martenson, Frank Morris, and Dmitry Orlov

April 1, 2017

Panel Discussion with John Michael Greer, James Howard Kunstler, Chris Martenson, Frank Morris, and Dmitry Orlov

The Curse of the Thinking Class

March 27, 2017

The Curse of the Thinking Class

Let’s suppose there really is such a thing as The Thinking Class in this country, if it’s not too politically incorrect to say so — since it implies that there is another class, perhaps larger, that operates only on some limbic lizard-brain level of impulse and emotion. Personally, I believe there is such a Thinking Class, or at least I have dim memories of something like it.

The farfetched phenomenon of Trumpism has sent that bunch on a journey to a strange land of the intellect, a place like the lost island of Kong, where one monster after another rises out of the swampy murk to threaten the frail human adventurers. No one back home would believe the things they’re tangling with: giant spiders, reptiles the size of front-end loaders, malevolent aborigines! Will any of the delicate humans survive or make it back home?

This is the feeling I get listening to arguments in the public arena these days, but especially from the quarters formerly identified as left-of-center, especially the faction organized around the Democratic Party, which I aligned with long ago (alas, no more). The main question seems to be: who is responsible for all the unrest in this land. Their answer since halfway back in 2016: the Russians.

I’m not comfortable with this hypothesis. Russia has a GDP smaller than Texas. If they are able to project so much influence over what happens in the USA, they must have some supernatural mojo-of-the-mind — and perhaps they do — but it raises the question of motive. What might Russia realistically get from the USA if Vladimir Putin was the master hypnotist that Democrats make him out to be?

Do we suppose Putin wants more living space for Russia’s people? Hmmmm. Russia’s population these days, around 145 million, is less than half the USA’s and it’s rattling around in the geographically largest nation in the world.

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

James Howard Kunstler on Fox News

March 19, 2017

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