THIS IS THE YEAR OF THE MANY UNKNOWNS
2015: what is in store?
January 4 2015
This is my first column of the New Year. May it be a healthy year for you all, a year that, without doubt, will bring us closer to the Grand Denouement, the Day when all will be revealed, which is the true meaning of the word Apocalypse.
In 2015 expect the worst, hope for the best, and be surprised. I was one year old when, in October 1929, the Great Depression started. For some reason – and I cannot pinpoint why –somehow the year 2015 reminds me of 1929, and the beginning of something for which no word has yet been invented, which perhaps indicates a condition infinitely worse than what some have called “The Ten Lost Years” referring to 1929-39, when only the unleashing of World War II ended that decade of economic malaise.
In this year I hope to continue writing weekly comments on current events from my perch in Tweed, Ontario Canada, where my wife and I live on 50 acres- 20 hectares – of mostly rock and trees. There, in 1975 I constructed a 2 storey dwelling, passive solar, well insulated, built into a small hill.
Over the forty years I developed a 2000 square feet – about 200 sq. m. – vegetable garden, and planted a few apple trees. I also have a sugar bush where I tap maple trees in the late winter- early spring, boiling down 35 liters of sap to obtain one liter of syrup, a labor intensive job, but the results are sweet. In a good year I get about 8 liters.
We live about 5 km – 3 miles – from the village where we shop for stuff we can’t grow or make ourselves. We heat with wood, and have a few solar panels, but are still connected to the grid.
I will continue to insert into my columns the odd bible text where it suits the message. I am a great believer in what I call ‘a biblical perspective’. I don’t know any other news source that ‘religiously’ does this on a weekly basis.
By the way, I am becoming a great admirer of Pope Francis, who is one person who does honor to Christianity. Laudate Dominum, Praise the Lord. Often Christianity separates grace from nature, in that sense it resembles the secular press which sees most news from an a- religious perspective, and thus misses the real story. The real story is that we are all part of God’s plan with the world, a plan that rushes all the way from Adam to that overwhelming finish when the reign of the Antichrist will be destroyed by the coming again of the Son of Man. All the news fits into that framework: the year 2015 will develop the way God wants it to go, even by allowing Satan to continue to create havoc for a while, which really means that we will speed to the End faster than ever.
It also will be a year where we will continue to read much misinformation in the newspapers and do the same on TV, because it is in the interest of the Corporate World to feed us with erroneous messages, all meant to prolong as much as possible the fake economy in which we all participate whether we like it or not, a state of affairs that is based on the fallacy of perpetual Economic Growth, and on the concept that we can pump poisonous gases into the air we breathe without fatal consequences.
I, as a teenager, lived through the war 1940-45 in German-occupied The Netherlands. Then too newspapers were printed and radio broadcasts were aired, but they all were totally censored to reflect the aims of the Nazi regime. For real news we, on peril of imprisoning, listened to the BBC. These broadcasts from London were heavily interfered with so that through all the static it was sometimes impossible to listen to the Dutch version coming from Lomdon. Yet they were a tonic to us. The sign-off slogan every day was:
Hoe moeilijk de dag, how zwaar ook de tijding, we zijn weer een dag dichter bij de bevrijding, which means
However difficult the day, however perilous the situation,
we are again a day closer to the liberation.
That liberation came on April 10 1945, exactly one month short of 5 years, as the Netherlands was invaded on May 10 1940.
The occupation bred the underground press. Many risked their lives in highly courageous ways to get news out to people, putting out newspapers, or mostly simple sheets so there would be a version of events out there that was real, and not just what the Germans wanted us to believe. The courage of these people is hard to gauge for us today, and I’m convinced there’s no way to say who amongst us today would show that kind of bravery if we were put to the test; I certainly wouldn’t be sure about myself.
There is something like that going on today. During the war all the so-called legitimate news was totally slanted to favor the Germans and their vassals, of which there were a few also among the Dutch people. Before the war the NSB, the political party favoring Germany, pulled something like 4 percent of the voters, a not inconsiderable number. Today the opposite is true: a vast majority of people favor the capitalistic structure, even the Socialists. A very tiny portion – perhaps less than 1 percent – tries to live more organically. No wonder the Press is 100 percent in the power of the Corporate World. These days, the media can make people believe just about anything, and they have the added benefit that they can pose as friends of the people, not the enemy.
In my own little way I will try to do what the ‘illegal’ press did more than 70 years ago in occupied Europe.
Let me begin to say that we have become very vulnerable. We increasingly, I should say, we totally, as a society depend on the Internet to do business. You and I can live without it, if we so desire. I know of very people who are not ‘wired’ but they are a tiny minority. But society at large cannot.
The network has become the nervous system of the planet. This is why it now makes no more sense to argue about whether the internet is good or bad than to debate whether oxygen or water are desirable. We’ve got it and we’re stuck with it. While offline crime has decreased dramatically – car-related theft has reduced by 79% since 1995 and burglary by 67%, for example – serious crime has now moved online, where its scale is staggering, even if the official statistics do not count it. I know because a few times my credit cards were compromised and also my line of credit affected – both totally compensated by the bank.
The same goes for industrial espionage (at which the Chinese are currently the world champions) and counter-espionage and counter-terrorism. Cyber-warfare is already in full swing, the latest being waged between North Korea and the USA. Beware: the internet is dangerous, untrustworthy and far from being private. E-mail never disappears, can easily be checked, and can lead to all sorts of unintended consequences. Actually if the entire total www computer network were to cease to function, it would mean the collapse of society, not at all a remote possibility,
This time it is different
2015 might be much worse than 1929 when there were a mere 2 billion people on the earth, Climate Change an unheard-of phenomenon, and almost all people had a rural connection, assuring a guaranteed food supply. When computers fail, in three days we all starve to death.
It’s not the first time that I have been wrong. For as long as I can remember I have warned people to prepare for the day when we run out of oil when the demand for oil exceeds its supply, which would result in economic stagnation. Well, I was wrong, and so were most investors, oil companies, and banks. They all followed the same reasoning and acted in the sure conviction that the oil price would forever range in the $100 per barrel. On that assumption companies invested billions in Arctic oil exploration, in deep sea and fracking adventures, in oil-sand expansion, not realizing that all these ventures would require billions of dollars and a lot of extra oil, as all the easy stuff had already been exploited, the so-called low-hanging fruit.
There is only so much that people can afford. A friend of mine, working for a large company complained to me that he hasn’t had a raise in 10 years. His lament is not an isolated one. That also means that his spending power has decreased, as the cost of living in that decade has increased by at least 25 percent. In order to enjoy the same standard of living, people have borrowed, so debt has skyrocketed. With income down, spending too is down, and the demand for oil has decreased while the supply has skyrocketed. So we see the law of economics still work: more supply, less demand, means lower prices.
Lower prices for oil mean trouble.
When prices for oil are low no one invests in exploration or drilling or production, or probably even maintenance for years. Chances are that when an economic recovery happens, perhaps a year or two down the line, with oil suddenly in demand, but supply lagging, Peak Oil may then become a reality. Whatever happens, life is going to change.
It looks very much that the global economy is unraveling, that unemployment, underemployment, and fear will combine to reduce consumption. We are in for deflation just like the 1930s, but now a world-wide event.
When – and it looks much more a ‘when’ than an ‘if’ – the world economy deflates, fixed asset values will decline. Real estate is especially vulnerable. Canada has seen the highest house prices ever. Where in the USA real estate values are, generally still well below their peak, in Canada they have steadily risen. Now stagnant incomes, increasing unemployment, and credit card debt guarantee consumers will prioritize spending decisions based on urgent need: food, fuel, and then rent (or mortgage payments). This last Christmas binge could be the last. In periods of declining economic activity, rental property owners (houses, apartment buildings, supermarkets and so on) face potential bankruptcy because of higher vacancy rates. It will also become increasingly difficult for rents to keep up with maintenance costs.
One key indicator of deflation that seems to be even more worrisome to investors, however, is global commodity prices and what commodity price weakness suggests for demand. Copper fell over 12% in 2014, largely due to slumping demand in China and other industrial economies. Natural gas prices have fallen more than 12% this year. And oil prices have fallen by over 40% due to a glut of new supply and weak demand growth in many developing economies. The International Energy Agency has cut its estimates for demand for crude five times in the past six months, The Wall Street Journal reports.
2015: what is in store?
Just as last year, don’t expect a raise. If indeed, deflation appears, that in itself means a raise, as goods are cheaper. We see it already in the fuel situation, which, although it has a positive angle, will lead to future problems. Cheaper oil will lead to more GHG – Green House Gases – and more unpredictable weather, more insurance claims, higher premiums, and, eventually, higher food costs.
Don’t for a minute believe that we, as a society, will do anything to reduce the effects of Climate Change. However desirable it may be to protect the Earth from the dire consequences of a runaway climate the chances that the world will agree to cut its emissions quickly enough to stay below the 2C threshold are somewhere between zip, zilch and zero.