“The world we live in is vastly different from the world we think we live in.” -Nassim Nicholas Taleb
To start this thing off right, I’d like to share what I’ve found to be one of the most valuable sources of information, the Crash Course from Peak Prosperity. While much of it is a compilation of information gathered from various other authors and sources, the elegance of the Crash Course is how its creator, Chris Martenson, assembles the pieces together to paint a picture of a vastly different future we are likely to see in the very near future. And while the information and conclusions it draws are pretty sobering, the refreshing thing about it is that the ultimate message is one of optimism and is not about scaring the crap out of people for profit or personal gain (like most mainstream media, elected officials, and various hucksters do today). Linked below is the short version of the Crash Course, which is condensed from the full 4+ hour Crash Course series of videos (which I encourage you to look into as well when you have the time) and is a little under an hour in length. Go ahead and take a look, I’ll wait...
Ok ok, for those of you who can’t or won’t watch it now I’ll summarize. It’s based around what he calls the three ‘E’s…. the Economy, Energy, and the Environment.
In the Economy section he focuses on the exponential nature of our monetary system (how it requires total debt and money supply to perpetually grow faster and faster in order to properly function) and the massive global credit bubble that’s due to end in a spectacular fashion. He also covers the 3 layers of wealth; primary wealth (arable land, water, energy sources, ore bodies, animal food sources), secondary wealth (finished products made from primary wealth such as building materials, food products, consumer goods, etc.), and tertiary wealth (paper wealth, including things like cash, stocks, bonds… basically the paper claims on the other two sources of wealth). The Energy section explains how oil is society’s ‘master resource’, and how Peak Cheap Oil and production limitations in other energy sources like coal and uranium are going to put a crimp in the exponential growth that our current economy and monetary system requires. Lastly, the Environment section is similar to Energy in that it highlights how many of the natural resources and wealth our economies rely on, whether it’s sources of ore, fisheries, fresh water, topsoil, etc., are diminishing at a time when the Economy requires more and more to keep expanding.
Anyway, the grand takeaway in the Crash Course is that we are ultimately headed for a world of less…. less growth, less energy, and less ‘stuff’. Basically the opposite of the ‘bigger, better future’ that most of us are assuming as a given. So how does this affect us in real, tangible terms? Well most visibly I expect jobs will be scarcer and a fair number of over-specialized or niche professions will either decline or cease to exist (life coaches, personal stylists, and marketing strategists, beware!). Any large and complex system requires an abundance of energy to maintain, and economies are no different. Without abundant "energy" (in this case, oil and other sources of primary wealth) the economy will contract to a simpler state which will be unable to support as many job specialties or as many workers (at least decently paid full-time workers). That’s a tough pill to swallow, as these days the job market is already unfriendly for many who are close to the breaking point, financially and emotionally. But it is what it is and everyone, employed and unemployed alike, will have to accept it and find a way to adapt. The next big effect will be rising costs and prices in most things, at least as a percentage of income. Expensive energy and diminishing availability of natural resources are enough on their own to accomplish this, but we have the economy angle working its way in too in the form of unprecedented central bank money printing, the effects of which will eventually make its way into the larger economy (instead of just into real estate and stocks and a few other niche areas as we’re currently seeing). The third big thing to look forward to is a re-balancing of the 3 layers of wealth away from the third or tertiary layer (cash and paper assets) to the primary and secondary forms of wealth. At this moment, Western society tends to pay more attention to cash, stocks, bonds, and other financial instruments, and the growth in said classes has far outstripped the growth in primary and secondary forms of wealth. But these are only paper claims to the other forms of wealth, and when certainty and trust in the financial system and central banks drops below a certain threshold you will see big shifts to tangible assets (as well as huge losses in those cases where there are multiple paper claims to a given asset).
How many individuals and families out there would be devastated by just ONE of these trends, let alone all three? Trying to imagine it in real terms, I figure it would be like one’s family going from a two-income household to a one-income household, seeing regular 10-20% yearly price increases in most goods and services, and having your savings and retirement accounts reduced by half…. all occurring within the same 5-year period. Now as a late Gen-X’er I was too little to remember the part of the 1970’s that I was around for, but from most descriptions I’ve read and heard it sounds like that decade of stagflation is an echo of what we're starting to see and can continue to expect. And to be honest, while I think it will follow a similar theme, I expect the results will be far worse than what was experienced in the 1970’s. Not only are the negative conditions worse, but most of us lack some of the resilience and grit that people had then. And that’s one thing that really makes me nervous…. not the disaster itself, but how the majority will react to that disaster. More often than not, peoples’ reactions and responses to a disaster or extreme set of circumstances plays more of a part in the overall impact of a disaster than the disaster itself. And let’s face it, we are frickin’ SOFT. Myself included. I mean I do work hard to save, plan, learn new skills, and make preparations for rocky times ahead, but being honest with myself I know that I’m still only half as tough as either of my grandfathers who lived through the Great Depression (one of whom served during WW2). And most Americans in turn are even softer than me, which I would find hilarious if the future implications of it weren’t so tragic. So I figure the only path to a future that doesn’t totally suck is to make people aware of these trends, and if they change their mindset and attitude then their actions should follow. If people accept the changes and choose to change their lives accordingly of their own volition, they may find themselves happier than they are now. The difference between changes you make voluntarily and changes forced upon you is immense.
So take some time to view the video, and at some point find a quiet place free of distractions to take even more time to mentally process it and determine for yourself if you agree or disagree with the information and/or conclusions. Even I’m not going to say I’m 100% confident all the conclusions it draws and trends it describes will come to pass (I think in terms of probabilities not certainties), but I do know the information it uses to draw the conclusions is solid, and I find the rationale behind the conclusions compelling enough to take action on. And if you watch it and don’t feel the same… well the worst that happens is that you learn a few things and end up with one less hour in your day to spend watching the drek that usually passes for TV these days.