By Bobby G. 5 March 2013 first posted in Akashic Records 5 March 2009
Speaking now from our hindsight vantage-point in 2013, before I lay out several recent articles, all somewhat long, detailing the crisis in agriculture which loomed in that year, 2009, I’ll say this. Finally, we begin to see the rapid-fire timeline that led us to the much -prophesized “end date” common to the Mayan Long Count Calendar, some predictive prophecy from the Vedic people’s tradition, as well as the “Timewave Zero” which Terence and Dennis McKenna supposedly discovered independently using the I Ching. Separately, Vinge, Kurzweil et al. had predicted a sort of orgy of technological radical human evolution they liked to call the “Technological Singularity” — also oddly enough pegged to the Maya Calendar date of 12/21/2012.
This 2012 thing really captured a lot of people’s attention. And well it should. I tended to conflate James Howard Kunstler’s snarky commentary together with the 2012 hoopla, while poking fun at the “technological singularity” I took to calling the pivotal date 12/21/2012 the “Clusterf**k Singularity.” Here’s how it plays out in the next 45 months:
2008 was the year the global banking system collapsed.
2009 was the year in which Totalitarian Agriculture finally collapsed, revealing its utter inability to feed the enormous global population, and the complete unsustainability that is essential to its existence as a system of human invention. (Articles below)
2010 was the year in which the fossil fuel energy system collapsed, strangely enough combining the peak of global oil production (”peak oil”) together with Richard Duncan’s “Olduvai Cliff.” Let’s just say that bad things really happened that year. It’s not one any of us want to revisit.
2011 brought on, early in the year, the complete collapse of the EurAmericAsian “military-industrial complex.” Warfare as a solution to unsustainability completely collapsed and unraveled. It ran out of funding, food, and energy. The entity known as the “nation-state” began its long sunset and disappearance as a plague from human history. It turned out, you could not kill every last “Islamic extremist” and “Jihadist” and in fact, those folks are now saddled with tremendous administrative burdens in those autonomous zones where they have the bad luck to be in charge. I wish them luck.
Which brings us to what happened in 2012. Industrial civilization devolved in an astonishing blink of an eye, historically speaking. We now, from our unfortunate vantage point in 2013, are faced with a world that is astonishingly ugly, ruined, completely dysfunctional, yet somehow we find hope in the task of rebuilding all this demolished shit from the ground up. I only hope we can preserve most of the extant species now remaining…
For now, let’s return to 2009, the year in which Totalitarian Agriculture met its demise.
First up, Bob Waldrop from Oklahoma Food Co-op dismissed James Howard Kunstler’s comments about the cause of the ag. crisis, which follows at the end of this interminable blog entry of mine.
Posted by: “Robert Waldrop”
Tue Mar 3, 2009 9:29 pm (PST)
I think Kunstler has it wrong about the impact of
our present financial crisis on farm country at
least for this year.
I am not hearing of any problems around here
regarding financing “at the farm level”. A lot of
credit provided for planting loans in the
conventional ag bidness comes from government
programs or is guaranteed by government programs
and that pipeline is still open. Crop insurance
also appears to still available. Conventional ag
hasn’t experienced a “credit bubble” over the last
decade the way the rest of the economy has. Ag
has already been there, done that, and gone
through several “collapses” over the last 30
years, so rural lenders to farmers have trended
towards “more conservative” than the pump and dump
$800,000 house in an exurb bidness.
The problems I am hearing about are mostly weather
related (Oklahoma has had a very dry winter, and
the winter wheat crop is suffering, indeed, we
need rain “soon” to have much of a crop this year
at all, see also “California Central Valley
Drought), in the CAFO system (high prices for
inputs), and at the “giant transnational
aggregator” level (e.g. financing for
international ag trade, the big transational
corporations like Archer Daniels Midland, etc). I
continue to hear a lot of anecdotes about CAFOs
(confined animal feeding operations) shutting down
suddenly.
Weather permitting, I think crops will be planted
and harvested this year. There sure could be
problems though in the supply chain relative to
the economic crisis. We could have a situation
where there is a lot of food at the rural
“gathering” spots like grain elevators and potato
warehouses, but bottlenecks getting it from there
to cities. In that situation, everyone from FEMA
to the National Guard might be mobilized to
transport field run foods into the cities, but
grain and soybeans while nourishing would be a
challenge for many urban families. Get your
printable flyer on how to improvise a grain
grinder and prepare soybeans while the internet is
still up!
http://www.energyco nservationinfo. org/printflyers. htm .
Speaking of drought, I have been planting peas and
potatoes and I should have been watering my mulch
this winter because not a lot of decomposition has
occurred at the ground level. So I bought an
organic fertilizer made here in Oklahoma, to go
with my Azomite (mineral dust, also a new tactic
this year) and the winter’s ashes from our wood
burning stove.
To return to farm credit, all bets are off for
next year. This year’s money is already in the
farm credit pipeline. We will see if the system
is able to do the same next year.
Bob Waldrop, OKC
Below is an update about the southern plains winter wheat crop, from today’s Oklahoma Farm Report. The news isn’t good. The issue this year is weather, not finance.
Bob Waldrop, OKC
http://oklahomafarmreport.com/wire/news/00593_Allendale_Wheat2009_213211.php
Another Verse of ‘How Dry We Are’ Being Sung- This Time by Joe Victor of Allendale~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~~
Allendale Inc is well aware of the fact two of the top four US winter wheat producing state’s crop condition ratings are far less than desirable. Both Texas and Oklahoma are facing very dry conditions, with little chance of rain hitting wheat fields in either state in the immediate future.
Weather conditions and forecast are less than optimistic for the Southern Plains as two week forecasted temps suggest swings of more than 25 degrees which may promote heaving while the present drought monitor suggest more than periodic rains will be required to dig out of harsh conditions. Principle key winter wheat producing states of Kansas, Oklahoma, Washington and Texas have a degree of abnormally dry to severe drought.
Joe Victor with Allendale has assembled a one pager on the ramifications for the wheat market fundamentals- and we have the pdf file linked on our website. Clickon the link below to take a look at this work.
http://oklahomafarmreport.com/wire/news/media/00006_Wheat_Conditions_p030309.pdf
By Eric deCarbonnel
After reading about the droughts in two major agricultural countries, China and Argentina, I decided to research the extent other food producing nations were also experiencing droughts. This project ended up taking a lot longer than I thought. 2009 looks to be a humanitarian disaster around much of the world
To understand the depth of the food Catastrophe that faces the world this year, consider the graphic below depicting countries by USD value of their agricultural output, as of 2006.
Now, consider the same graphic with the countries experiencing droughts highlighted.
The countries that make up two thirds of the world’s agricultural output are experiencing drought conditions. Whether you watch a video of the drought in China, Australia, Africa, South America, or the US, the scene will be the same: misery, ruined crop, and dying cattle.
China
The drought in Northern China, the worst in 50 years, is worsening, and summer harvest is now threatened. The area of affected crops has expanded to 161 million mu (was 141 million last week), and 4.37 million people and 2.1 million livestock are facing drinking water shortage. The scarcity of rain in some parts of the north and central provinces is the worst in recorded history.
The drought which started in November threatens over half the wheat crop in eight provinces – Hebei, Shanxi, Anhui, Jiangsu, Henan, Shandong, Shaanxi and Gansu.
Henan
China’s largest crop producing province, Henan, has issued the highest-level drought warning. Henan has received an average rainfall of 10.5 millimeters since November 2008, almost 80 percent less than in the same period in the previous years. The Henan drought, which began in November, is the most severe since 1951.
Anhui
Anhui Province issued a red drought alert, with more than 60 percent of the crops north of the Huaihe River plagued by a major drought.
Shanxi
Shanxi Province was put on orange drought alert on Jan. 21, with one million people and 160,000 heads of livestock are facing water shortage.
Jiangsu
Jiangsu province has already lost over one fifth of the wheat crops affected by drought. Local agricultural departments are diverting water from nearby rivers in an emergency effort to save the rest.
Hebei
Over 100 million cubic meters of water has been channeled in from outside the province to fight Hebei’s drought.
Shaanxi
1.34 million acres of crops across the bone-dry Shanxi province are affected by the worsening drought.
Shandong
Since last November, Shandong province has experienced 73 percent less rain than the same period in previous years, with little rainfall forecast for the future.
Relief efforts are under way. The Chinese government has allocated 86.7 billion yuan (about $12.69 billion) to drought-hit areas. Authorities have also resorted to cloud-seeding, and some areas received a sprinkling of rain after clouds were hit with 2,392 rockets and 409 cannon shells loaded with chemicals. However, there is a limit to what can be done in the face of such widespread water shortage.
As I have previously written, China is facing hyperinflation, and this record drought will make things worse. China produces 18% of the world’s grain each year.
Australia
Australia has been experiencing an unrelenting drought since 2004, and 41 percent of Australia’s agriculture continues to suffer from the worst drought in 117 years of record-keeping. The drought has been so severe that rivers stopped flowing, lakes turned toxic, and farmers abandoned their land in frustration:
A) The Murray River stopped flowing at its terminal point, and its mouth has closed up.
B) Australia’s lower lakes are evaporating, and they are now a meter (3.2 feet) below sea level. If these lakes evaporate any further, the soil and the mud system below the water is going to be exposed to the air. The mud will then acidify, releasing sulfuric acid and a whole range of heavy metals. After this occurs, those lower lake systems will essentially become a toxic swamp which will never be able to be recovered. The Australian government’s only options to prevent this are to allow salt water in, creating a dead sea, or to pray for rain.
For some reason, the debate over climate change is essentially over in Australia.
The United States
California
California is facing its worst drought in recorded history. The drought is predicted to be the most severe in modern times, worse than those in 1977 and 1991. Thousands of acres of row crops already have been fallowed, with more to follow. The snowpack in the Northern Sierra, home to some of the state’s most important reservoirs, proved to be just 49 percent of average. Water agencies throughout the state are scrambling to adopt conservation mandates.
Texas
The Texan drought is reaching historic proportion. Dry conditions near Austin and San Antonio have been exceeded only once before—the drought of 1917-18. 88 percent of Texas is experiencing abnormally dry conditions, and 18 percent of the state is in either extreme or exceptional drought conditions. The drought areas have been expanding almost every month. Conditions in Texas are so bad cattle are keeling over in parched pastures and dying. Lack of rainfall has left pastures barren, and cattle producers have resorted to feeding animals hay. Irreversible damage has been done to winter wheat crops in Texas. Both short and long-term forecasts don’t call for much rain at all, which means the Texas drought is set to get worse.
Augusta Region (Georgia, South Carolina, North Carolina)
The Augusta region has been suffering from a worsening two year drought. Augusta’s rainfall deficit is already approaching 2 inches so far in 2009, with January being the driest since 1989.
Florida
Florida has been hard hit by winter drought, damaging crops, and half of state is in some level of a drought.
La Niña likely to make matters worse
Enough water a couple of degrees cooler than normal has accumulated in the eastern part of the Pacific to create a La Niña, a weather pattern expected to linger until at least the spring. La Niña generally means dry weather for Southern states, which is exactly what the US doesn’t need right now.
South America
Argentina
The worst drought in half a century has turned Argentina’s once-fertile soil to dust and pushed the country into a state of emergency. Cow carcasses litter the prairie fields, and sun-scorched soy plants wither under the South American summer sun. Argentina’s food production is set to go down a minimum of 50 percent, maybe more. The country’s wheat yield for 2009 will be 8.7 million metric tons, down from 16.3 million in 2008. Concern with domestic shortages (domestic wheat consumption being approximately 6.7 million metric ton), Argentina has granted no new export applications since mid January.
Brazil
Brazil has cut its outlook for the crops and will do so again after assessing damage to plants from desiccation in drought-stricken regions. Brazil is the world’s second-biggest exporter of soybeans and third-largest for corn.
Brazil’s numbers for corn harvesting:
Harvested in 2008: 58.7 million tons
January 8 forecast: 52.3 million tons
February 6 forecast: 50.3 metric tons (optimistic)
Harvested in 2009: ???
Paraguay
Severe drought affecting Paraguay’s economy has pushed the government to declare agricultural emergency. Crops that have direct impact on cattle food are ruined, and the soy plantations have been almost totally lost in some areas.
Uruguay
Uruguay declared an “agriculture emergency” last month, due to the worst drought in decades which is threatening crops, livestock and the provision of fresh produce.
The a worsening drought is pushing up food and beverage costs causing Uruguay’s consumer prices to rise at the fastest annual pace in more than four years in January.
Bolivia
There hasn’t been a drop of rain in Bolivia in nearly a year. Cattle dying, crops ruined, etc…
Chile
The severe drought affecting Chile has caused an agricultural emergency in 50 rural districts, and large sectors of the economy are concerned about possible electricity rationing in March. The countries woes stem from the “La Niña” climate phenomenon which has over half of Chile dangling by a thread: persistently cold water in the Pacific ocean along with high atmospheric pressure are preventing rain-bearing fronts from entering central and southern areas of the country. As a result, the water levels at hydroelectric dams and other reservoirs are at all-time lows.
Horn of Africa
Africa faces food shortages and famine. Food production across the Horn of Africa has suffered because of the lack of rainfall. Also, half the agricultural soil has lost nutrients necessary to grow plant, and the declining soil fertility across Africa is exacerbating drought related crop losses.
Kenya
Kenya is the worst hit nation in the region, having been without rainfall for 18 months. Kenya needs to import food to bridge a shortfall and keep 10 million of its people from starvation. Kenya’s drought suffering neighbors will be of little help.
Tanzania
A poor harvest due to drought has prompted Tanzania to stop issuing food export permits. Tanzania has also intensified security at the border posts to monitor and prevent the export of food. There are 240,000 people in need of immediate relief food in Tanzania.
Burundi
Crops in the north of Burundi have withered, leaving the tiny East African country facing a severe food shortage
Uganda
Severe drought in northeastern Uganda’s Karamoja region has the left the country on the brink of a humanitarian catastrophe. The dry conditions and acute food shortages, which have left Karamoja near starvation, are unlikely to improve before October when the next harvest is due.
South Africa
South Africa faces a potential crop shortage after wheat farmers in the eastern part of the Free State grain belt said they were likely to produce their lowest crop in 30 years this year. South Africans are “extremely angry” that food prices continue to rise.
Other African nations suffering from drought in 2009 are: Malawi, Zambia, Swaziland, Somalia, Zimbabwe, Mozambique, Tunisia, Angola, and Ethiopia.
Middle East and Central Asia
The Middle East and Central Asia are suffering from the worst droughts in recent history, and food grain production has dropped to some of the lowest levels in decades. Total wheat production in the wider drought-affected region is currently estimated to have declined by at least 22 percent in 2009. Owing to the drought’s severity and region-wide scope, irrigation supplies from reservoirs, rivers, and groundwater have been critically reduced. Major reservoirs in Turkey, Iran, Iraq, and Syria are all at low levels requiring restrictions on usage. Given the severity of crop losses in the region, a major shortage of planting seed for the 2010 crop is expected.
Iraq
In Iraq during the winter grain growing period, there was essentially no measurable rainfall in many regions, and large swaths of rain-fed fields across northern Iraq simply went unplanted. These primarily rain-fed regions in northern Iraq are described as an agricultural disaster area this year, with wheat production falling 80-98 percent from normal levels. The USDA estimates total wheat production in Iraq in 2009 at 1.3 million tons, down 45 percent from last year.
Syria
Syria is experienced its worst drought in the past 18 years, and the USDA estimates total wheat production in Syria in 2009 at 2.0 million tons, down 50 percent from last year. Last summer, the taps ran dry in many neighborhoods of Damascus and residents of the capital city were forced to buy water on the black market. The severe lack of rain this winter has exacerbated the problem.
Afghanistan
Lack of rainfall has led Afghanistan to the worst drought conditions in the past 10 years. The USDA estimates 2008/09 wheat production in Afghanistan at 1.5 million tons, down 2.3 million or 60 percent from last year. Afghanistan normally produces 3.5-4.0 million tons of wheat annually.
Jordan
Jordan’s persistent drought has grown worse, with almost no rain falling on the kingdom this year. The Jordanian government has stopped pumping water to farms to preserve the water for drinking purposes.
Other Middle Eastern and Central Asian nations suffering from drought in 2009 are: The Palestinian Territories, Lebanon, Israel, Bangladesh, Myanmar, India, Tajikistan, Turkmenistan, Thailand, Nepal, Pakistan, Turkey, Kyrgyzstan, Uzbekistan, Cyprus, and Iran.
Lack of credit will worsen food shortage
A lack of credit for farmers curbed their ability to buy seeds and fertilizers in 2008/2009 and will limit production around the world. The effects of droughts worldwide will also be amplified by the smaller amount of seeds and fertilizers used to grow crops.
Low commodity prices will worsen food shortage
The low prices at the end of 2008 discouraged the planting of new crops in 2009. In Kansas for example, farmers seeded nine million acres, the smallest planting for half a century. Wheat plantings this year are down about 4 million acres across the US and about 1.1 million acres in Canada. So even discounting drought related losses, the US, Canada, and other food producing nations are facing lower agricultural output in 2009.
Europe will not make up for the food shortfall
Europe, the only big agricultural region relatively unaffected by drought, is set for a big drop in food production. Due to the combination of a late plantings, poorer soil conditions, reduced inputs, and light rainfall, Europe’s agricultural output is likely to fall by 10 to 15 percent.
Stocks of foodstuff are dangerously low
Low stocks of foodstuff make the world’s falling agriculture output particularly worrisome. The combined averaged of the ending stock levels of the major trading countries of Australia, Canada, United States, and the European Union have been declining steadily in the last few years:
2002-2005: 47.4 million tons
2007: 37.6 million tons
2008: 27.4 million tons
These inventory numbers are dangerously low, especially considering the horrifying possibility that China’s 60 million tons of grain reserves doesn’t actually exists.
Global food Catastrophe
The world is heading for a drop in agricultural production of 20 to 40 percent, depending on the severity and length of the current global droughts. Food producing nations are imposing food export restrictions. Food prices will soar, and, in poor countries with food deficits, millions will starve.
The deflation debate should end now
The droughts plaguing the world’s biggest agricultural regions should end the debate about deflation in 2009. The demand for agricultural commodities is relatively immune to developments in the business cycles (at least compared to that of energy or base metals), and, with a 20 to 40 percent decline in world production, already rising food prices are headed significantly higher.
In fact, agricultural commodities NEED to head higher and soon, to prevent even greater food shortages and famine. The price of wheat, corn, soybeans, etc must rise to a level which encourages the planting of every available acre with the best possible fertilizers. Otherwise, if food prices stay at their current levels, production will continue to fall, sentencing millions more to starvation.
Competitive currency appreciation
Some observers are anticipating “competitive currency devaluations” in addition to deflation for 2009 (nations devalue their currencies to help their export sector). The coming global food shortage makes this highly unlikely. Depreciating their currency in the current environment will produce the unwanted consequence of boosting exports—of food. Even with export restrictions like those in China, currency depreciation would cause the outflow of significant quantities of grain via the black market.
Instead of “competitive currency devaluations”, spiking food prices will likely cause competitive currency appreciation in 2009. Foreign exchange reserves exist for just this type of emergency. Central banks around the world will lower domestic food prices by either directly selling off their reserves to appreciate their currencies or by using them to purchase grain on the world market.
Appreciating a currency is the fastest way to control food inflation. A more valuable currency allows a nation to monopolize more global resources (ie: the overvalued dollar allows the US to consume 25% of the world’s oil despite having only 4% of the world’s population). If China were to selloff its US reserves, its enormous population would start sucking up the world’s food supply like the US has been doing with oil.
On the flip side, when a nation appreciates its currency and starts consuming more of the world’s resources, it leaves less for everyone else. So when china appreciates the yuan, food shortages worldwide will increase and prices everywhere else will jump upwards. As there is nothing that breeds social unrest like soaring food prices, nations around the world, from Russia, to the EU, to Saudi Arabia, to India, will sell off their foreign reserves to appreciate their currencies and reduce the cost of food imports. In response to this, China will sell even more of its reserves and so on. That is competitive currency appreciation.
When faced with competitive currency appreciation, you do NOT want to be the world’s reserve currency. The dollar is likely to do very poorly as central banks liquidate trillions in US holdings to buy food and appreciate their currencies
James Howard Kunstler, Clusterfunk Nation, 2 March 2009.
Isn’t that a question, though….
The Peak Oil story was never about running out of oil. It was about the collapse of complex systems in a world economy faced by the prospect of no further oil-fueled growth. It was something of a shock to many that the first complex system to fail would be banking, but the process is obvious: no more growth means no more ability to pay interest on credit… end of story, as Tony Soprano used to say.
There was a popular theory among Peak Oilers the last decade that the world would enter a “bumpy plateau” period when the global economy would get beaten down by peak oil, would then revive as “demand destruction” drove down oil prices, and would be beaten down again as oil prices shot up in response — with serial repetitions of the cycle, each beat-down taking economies lower — the only imaginable outcome being some sort of quiet homeostasis. This scenario did not play out as expected. It was predicated on a mistaken assumption that all systems would retain some kind of operational resilience while ratcheting down. Anyway, the banking system was mortally wounded in the first go-round and the behemoth is dying hard.
The last desperate act of the banking system in the face of Peak Oil’s no-more-growth equation was to engineer species of tradable securities that could produce wealth out of thin air rather than productive activity. This was the alphabet soup of algorithm-derived frauds with vague and confounding names such as credit default swaps (CDSs), collateralized debt obligations (CDOs), structured investment vehicles (SIVs), and, of course, the basic filler, mortgage backed securities. The banking system is now choking to death on these delicacies.
The trouble is that the EMT squad brought in to rescue the banking system — that is, governments — can’t remove these obstructions from the patient’s craw. They don’t want to drown in a mighty upchuck of the alphabet soup.
The collapse of complex systems is actually predicated on the idea that the systems would mutually reinforce each other’s failures. This is now plain to see as the collapse of banking (that is, of both lending and debt service), has led to the collapse of commerce and manufacturing. The next systems to go will probably be farming, transportation, and the oil markets themselves (which constitute the system for allocating and distributing world energy resources). As these things seize up, the final system to go will be governance, at least at the highest levels.
If we’re really lucky, human affairs will eventually reorganize at a lower scale of activity, governance, civility, and economy. Every week, the failure to recognize the nature of our predicament thrusts us further into the uncharted territory of hardship. The task of government right now is not to prop up doomed systems at their current scales of failure, but to prepare the public to rebuild our systems at smaller scales.
The net effect of the failures in banking is that a lot of people have less money than they expected they would have a year ago. This is bad enough, given our habits and practices of modern life. But what happens when farming collapses? The prospect for that is closer than most of us might realize. The way we produce our food has been organized at a scale that has ruinous consequences, not least its addiction to capital. Now that banking is in collapse, capital will be extremely scarce. Nobody in the cities reads farm news, or listens to farm reports on the radio. Guess what, though: we are entering the planting season. It will be interesting to learn how many farmers “out there” in the Cheez Doodle belt are not able to secure loans for this year’s crop.
My guess is that the disorder in agriculture will be pretty severe this year, especially since some of the world’s most productive places — California, northern China, Argentina, the Australian grain belt — are caught in extremes of drought on top of capital shortages. If the US government is going to try to make remedial policy for anything, it better start with agriculture, to promote local, smaller-scaled farming using methods that are much less dependent on oil byproducts and capital injections.
This will, of course, require a re-allocation of lands suitable for growing food. Our real estate market mechanisms could conceivably enable this to happen, but not without a coherent consensus that it is imperative to do so. If agri-business as currently practiced doesn’t founder on capital shortages, it will surely collapse on disruptions in the oil markets. President Obama at least made a start in the right direction by proposing to eliminate further subsidies to farmers above the $250,000 level. But the situation is really more acute. Surely the US Department of Agriculture already knows about it, but the public may not be interested until the shelves in the Piggly-Wiggly are bare — and then, of course, they’ll go apeshit.
The recent huge drop in oil prices has left the public once again convinced that the world is drowning in oil — if only the scoundrelly oil companies were forced to deliver it at reasonable prices. The public has been consistently deluded about this for decades. What’s missing so far is for the president of the US to lay out the reality of the situation in a dedicated TV address. I know a lot of you think that Jimmy Carter already tried this and failed to make an impression (and ruined his presidency in the process). I guarantee you that Mr. Obama will have to do this sometime in the next few years whether he likes or not, and he’d be well-advised to get it done sooner rather than later. And by this I don’t mean just vague allusions to “energy independence” or “renewables” in speeches devoted to many other issues. I mean telling the public the plain truth that we’ll never offset oil depletion and the intelligent response is to do everything possible to transition to walkable towns and public transit, not to sustain the unsustainable.
The alternatives — i.e. what we’re trying now — is to further delude ourselves into thinking that we can run WalMart and the suburbs by some other means than oil. Despite all our investments in these things, we won’t be able to run them by other means, and the news about this had better get out before enormous disappointment turns into titanic rage. If Americans think they’ve been grifted by Goldman Sachs and Bernie Madoff, wait until they find out what a swindle the so-called “American Dream” of suburban life turns out to be.
On this blizzardy Monday in the power centers of America, attention is fixed on the never-ending fiasco of AIG — a company whose main product turned out to be credit default swaps, and is now choking on them. Kibitzers on the sidelines of finance are forecasting a king-hell bear market suckers’ rally in the stock markets followed by a belly flop to Dow 4000 or lower. I myself called for Dow 4000 two years ago — and was obviously a bit off on my timing. All this is surely trouble enough. But while your attention is focused on Rick Santelli in the Chicago trader’s pit, or Larry Kudlow desperately seeking “mustard seeds” of new growth in financials, try to let one eye stray to the horizon where these other complex systems are working out their next moves. Farming. The oil markets. These are the coming theaters of alarm and distress.
