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The Coming (or Arrived) Crisis 
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Heinlein Nexus
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Post The Coming (or Arrived) Crisis
Starting a thread as suggested in the "Other Interests" thread on the current global crisis/es.

Food riots. Rice tripling in price in three months and being rationed in certain North American outlets. A credit crisis that's only just begun and the major subprime resets haven't yet hit (will within the next three months). Peak oil. Social Security and Medicare on the brink of insolvency and in at least the opinion of a large number of people and some polar bears, global climate change. Help! At this point in a Heinlein story the protagonist(s) would chuck it in and migrate offworld.

I've read of some economists who are doing the survivalist thing - moving to New Zealand, for example. Learning how to grow one's own food seems like a good idea - a supply chain expert was recently quoted as saying that people should get used to the idea of no longer seeing fresh pineapples and mangoes in the stores out of season.

All smoke, or some fire, and where? Are you prepared/preparing in any way?


Last edited by PeterScott on Sun Apr 27, 2008 2:11 pm, edited 1 time in total.



Sun Apr 27, 2008 6:41 am
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Post Re: The Coming (or Arrived) Crisis
90% smoke. 8% fire. 2% alien invaders.

For all the panickery, we seem to have the artful ability to not just deal with crises, but often sidestep them altogether. Nothing is straightline, as far as I can tell no past "crisis" ever continued or resolved on a straightline basis, and nearly all panicking is based on straight-line or straight-progression assumptions.

I always think of the great copper crisis of ca. 1968. It was little noticed outside the telecommunications world, which at that time equalled national-scale providers like Bell, British Telecom (actually still BPO then, I think) etc. But insiders were terrified by the cold, hard fact that the growth in telecommunications depended on a logarithmic increase in the amount of copper needed for comm wiring. It was accelerating at a rate that would require, ca. 2000, more copper than had been mined from the earth since 1900. There is no good alternative to copper for wiring, for many reasons, so it looked as if there was going to be a terribly crippling hit to every industry that relied on moving electricity around.

Well, at the time, it was a state of the art trick to pack 12 simultaneous conversations on a single carrier. It did not take long (ca. 1975) to increase that to hundreds per carrier (or "pair" as in pair of wires), and that rate accelerated until using digital techniques the rate is hundreds of thousands of connections per pair - which may be a lot of things besides a pair of copper wires.

I've seen dozens of such examples in my lifetime, and not one real piece of sky falling.

Yes, we have an ugly decade ahead of us, after 20 or more years of growth and prosperity and general planetary peace. But we will sidestep 90% of the problems without anyone but experts quite noticing, and learn to live with/without the effects of the other 10%.

I will also note that there are always technological and economic pinch-points, such as one nation hogging a rare earth critical to another's industry. Anyone recall that the USSR had a slight dislike for us and a near-monopoly on titanium or some other critical metal in an era when we needed it to build our fighters? We never built one less fighter, bomber or cargo plane because of it.

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Sun Apr 27, 2008 9:59 am
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Post Re: The Coming (or Arrived) Crisis
but there have been crises....

Collapse of the Soviet Union was certainly a crisis to them.
Argentina's banking system collapse was certainly a crisis to them as well.
There are others...

If it can happen to others it could eventually happen to us...and already has once if we're willing to go back to 1929. For that matter we did not sidestep the oil crisis of the 1970s (78?)...


Mon Apr 28, 2008 12:22 pm
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Post Re: The Coming (or Arrived) Crisis
JohnBlack wrote:
For that matter we did not sidestep the oil crisis of the 1970s (78?)...

1973-74. There was a lesser "crisis" around 1978.

We may not have sidestepped it, but it didn't have much effect, either. We had gas lines for about four months, but hardly anyone actually did without except in narrow and short-term situations. Gas doubled from ca. 35 cents a gallon to 70 or so, which by most accounts brought it into line with inflation over the prior 20 years. Detroit was forced to stop building land yachts no one wanted - bad for Detroit, good for everyone else.

Other than that, we came out of it with generally improved vehicle mileage and fuel costs that remained stable for... two decades, perhaps? I've lost track.

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Mon Apr 28, 2008 1:44 pm
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Post Re: The Coming (or Arrived) Crisis
The current financial crisis has many aspects that are being described as "the worst since the Great Depression". The pool of available ways of mitigating the effects has been exhausted.

I think the point here is not, let's all slit our wrists, but, what should we prepare for? Heinlein wasn't the morose type, but he still considered a fallout shelter essential. WWBD at this point? That we will come through it somehow is more or less a given, but the idea that we'll save ourselves before things get incredibly bad is an article of faith. 'Taint necessarily going to be so.

We're considering getting into growing more than a token amount of our own food. It's an honorable calling and a skill Bob would have approved of.

I'll also suggest that right now gold is correcting and a buying opportunity has either arrived or is imminent. I just ordered another Maple Leaf.


Mon Apr 28, 2008 6:10 pm
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Post Re: The Coming (or Arrived) Crisis
Peter Scott wrote:
Heinlein wasn't the morose type, but he still considered a fallout shelter essential. WWBD at this point? That we will come through it somehow is more or less a given, but the idea that we'll save ourselves before things get incredibly bad is an article of faith. 'Taint necessarily going to be so.
We're considering getting into growing more than a token amount of our own food. It's an honorable calling and a skill Bob would have approved of.

We're buying an old house on a half acre, close enough to bicycle to work if it comes to that, with room for a large garden with perennial beds and some dwarf fruit trees. Gutters to cystern, solar water preheat, radiant floors (at least between bed and bath), and point of use water heaters. A rabbit hutch over a worm farm, and chickens round the garden (or the silent ducks, if the neighbors object to animal noise).
That's the way we want to live in any case, so now's a good time to start working in that direction. The process will be a good life, and if someday we're not able to maintain our energy-gulping hobbies (we're both employed as technicians) there will be a lot of good work to keep us busy.
My father is slowly moving from cattle ranching to raising goats; if worse came to worse we could head for the hills and help hold down the fort on the old homestead. Happy Valley, here we come!
Don't actually expect it to get that bad but don't actually expect it not too, either. Plan to be prepared, either way.

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Tue Apr 29, 2008 6:40 am
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Post Re: The Coming (or Arrived) Crisis
I believe there is little doubt that the current confluence of crises in financial markets, global food prices, oil supplies, and military and ideological conflicts is damaging, at least in the short run, to our national well-being. However, the connections between these crises are tenuous at best; it's the confluence of all of them at once that is the problem. The impact is financial (on governments and citizens), moral and political.

Unless you're sufficiently wealthy, the downturn in real estate prices is bound to have impacted your net worth and feelings of affluence. The market will self-correct, but it will be years before we get back to where we were two years ago.

Depending on your household income, the run-up of prices for certain food staples is at least unsettling if not worse, and if you live in the third world, much worse. Some of this is connected to the increase in the price of oil, but there are independent forces at work, including speculation. There is reason to hope that this will self-correct as well, but it may get much worse before it gets better, putting further strain on over-extended national budgets, given the commonly-perceived moral imperative to not let people starve because they can't afford to buy food.

Oil prices have been driven sharply higher by both supply and demand issues and speculation driven by international events. There is no reason to believe that world demand for oil will fall, given the rapid industrialization and growing middle class demands of China and India. Major oil producing nations are either unwilling or unable to increase production to keep up with the growth in demand. Large new finds of petroleum reserves are rarer and rarer, and technological breakthroughs in alternative energy fields are not on the immediate horizon. I don't see a light at the end of the tunnel here.

The military conflicts that the US is involved in, driven by ideological radicalism (and some would say our government's past and present conduct) were avoidable in some cases and unavoidable in others. But, there's no denying the huge cost of these conflicts, and the negative impact their cost has had and will have on the government's ability to respond to the other crises impacting the public.

In summary, I've seen a lot in my lifetime, but this current set of events does seem somewhat more serious taken as a whole than we've experienced in recent history. I do maintain some optimism that they will all be solved, or we will find a way to live with them without serious damage to our standard of living and social progress, but they are worrying.

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Tue Apr 29, 2008 7:39 am
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Post Re: The Coming (or Arrived) Crisis
Shit. I just spent an hour writing a very long response to this thread and then accidentally closed the browser while checking a fact.

Perhaps my karma or my workstation is telling me something.

I don't have another hour, but I'll summarize:

I think it is too late for most individuals to "do anything" about riding out the next few years. The window was last year, when all these crises, including the impending deflation of the housing bubble, were writ large on the brick wall we've smacked into. If you're not in a position to float, I don't think you can do much but buckle in for the ride.

Peter: I think you're absolutely nutz to buy gold at these prices, for any reason. The time to buy for any economic or investment purpose was below US$400. Unless things get so bad you use those MLs to buy heating fuel and groceries, you'll be holding them at no more than US$500 by this time next year. I'll make a 50% bet that it's closer to the long term stable valuation of about US$350.

And finally, more than 50 minutes of effort boiled into far too little: no mortgage bailouts at any level. Let those suckered into paying $600k for a stucco turd full of "amenities" without a single saving grace outside its walls pay off their phantom value, just as millions of Japanese are now doing for faulty judgment ten years ago.

In all complete seriousness, I blame television. It has destroyed the ability to think for oneself and to distinguish outright bullshit from reality. "Ve vass chust followink orders." "Vell, get zose orders in now, folks, haw haw!"

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Tue Apr 29, 2008 11:59 am
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Post Re: The Coming (or Arrived) Crisis
James Gifford wrote:
Peter: I think you're absolutely nutz to buy gold at these prices, for any reason. The time to buy for any economic or investment purpose was below US$400. Unless things get so bad you use those MLs to buy heating fuel and groceries, you'll be holding them at no more than US$500 by this time next year. I'll make a 50% bet that it's closer to the long term stable valuation of about US$350.


I'll take that bet. Have you looked at the chart of the price of the Dow in ounces of gold? Or gold adjusted for inflation? Gold looks like it should be worth more like $2000 an ounce right now. I read that central banks have sold gold for the last decade to artificially depress the price. Can't keep that up much longer.

James Gifford wrote:
And finally, more than 50 minutes of effort boiled into far too little: no mortgage bailouts at any level. Let those suckered into paying $600k for a stucco turd full of "amenities" without a single saving grace outside its walls pay off their phantom value, just as millions of Japanese are now doing for faulty judgment ten years ago.


Yep, but America loves a cause that grabs the headlines. Sadly, it appears that a winning strategy may be to go along with the lemming herd, because if everyone else goes over the cliff, the government will erect a safety net for all of you. But if you encounter hard times on your own, tough luck. So if your house gets flooded out, you won't get any help unless it's surrounded by New Orleans. Have trouble making the mortgage and you won't get any help unless you bought a subprime liar loan in 2006. Etc. So in an election year, the odds of there not being a sop to the saps in their McMansions is about zero.

Which brings me back to wanting to hop on the next torch ship to Fiddler's Green. Oh wait, wrong forum. So, again - WWBD?


Tue Apr 29, 2008 6:43 pm
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Post Re: The Coming (or Arrived) Crisis
Peter Scott wrote:
I'll take that bet. Have you looked at the chart of the price of the Dow in ounces of gold? Or gold adjusted for inflation? Gold looks like it should be worth more like $2000 an ounce right now. I read that central banks have sold gold for the last decade to artificially depress the price. Can't keep that up much longer.

So the gold bugs have been saying for, oh, close to 100 years if we start with the "Free Silver" era. (<fx Groucho voice> And I think Silver oughta stay locked up, if you know what I mean. </fx>) And for whatever reason, gold has stayed near an incredibly stable level for a very long time, occasional spikes notwithstanding. There must be more of a reason than artificial suppression.

I won't pretend to understand what I have seen throughout my life. I'll simply wager, oh, US$10 that gold will average less than US$500 per ounce in the month of June 2009. That's for the spread US$400-600. If it's over US$600, I owe you US $20. If (as I strongly suspect) it is below US$400, you owe me that double sawbuck.

Quote:
"WWBD"

I'm not sure Our Man Bob is any good reference. He made his share of life mistakes and did not end up wealthy due to any sharp financial acumen. Nor did he live through any significant era of upheaval after WWII, which was when his financial success started.

If we must stay on a Bobbian track here, I'll go with his belief that most people are good and the great mass of people will do the right thing, when the time comes. Which tends towards the sort of self-stabilizing situation we have lived with for quite a long time.

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In the end, I found Heinlein is finite. Thus, finite analysis is needed.


Tue Apr 29, 2008 8:11 pm
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