KUNSTLER: What happens when a substantial portion of the public is permanently foreclosed from motoring because they've lost jobs and incomes and positions and vocations that they will never get back -- ?

SHOOT: In this week's blog, James Kunstler describes the first die-off - cars. He rightly asks how GM can expect people to switch from ordinary cars they can't afford to an electric car priced as much as a Mercedes Benz. He says not long from now we will think of traffic jams wirth fond sentimentality [it was our time of plenty].

KUNSTLER: The whole adult US population is going to rush out and buy new cars priced the same as today's Mercedes Benz? Good luck with that, GM, especially when money for car loans will be about as easy to get as a royal flush in online poker. And good luck with changing out the battery for ten grand a couple of years down the road, so to speak. And good luck also with your expectation that the roads and bridges will remain drivable in the years ahead, as every municipality, and county, and state slides into bankruptcy and the paving machines sit rusting in the DOT marshaling yards.
What is wrong with our brains? Are they turning to yeast?

clipped from kunstler.com Personally, I think the car die-off will come on with stunning rapidity as a combination of factors merge to make these colossal traffic jams staples of nostalgia in decades to come. As usual, the public is clueless about this, gulled by a cretinous news media into the earnest expectation of endless techno-miracles. The funniest of these lately are the glad tidings from ("The New" ) General Motors. They came out last week with a laughable hype-fest for their proposed electric car, the "Volt," scheduled to arrive in the showrooms around 2011 (about the same time that all the mortgage-backed-securities sitting in Wall Street's vaults melt into a monumental puddle of radioactive goo). We're told the Volt will get the equivalent of over 200 miles-per-gallon, at less than 25 cents a charge from the plug on your garage wall, blah blah. They estimate that it'll cost about $40,000. Do we detect a little problem right there?

Mindless programming is the sort of thing that kills societies

Kunstler: Why are those other Wall Street smoothies still enjoying their Hamptons villas while the foreclosed set up tents in the Sacramento Delta?

SHOOT: Feeling comfortable? It's temporary.

Kunstler: President Obama had better turn his efforts from pretending to re-start the revolving credit rackets to overseeing the comprehensive re-simplifying of American life. I think he has a few weeks to turn his rhetoric around before the political mischief begins for real, and the aggrieved classes start shooting things up and burning things down. These classes really do need something to hope for, and something to work at, and something to occupy their attention besides their grief over the massive losses in their lives. But none of that energy will be focused beneficially unless they hear the truth... that there really is no going back to what was before.

clipped from kunstler.com Over the last ten days, somebody shot the "Green Shoots" narrative in the head. There is no way the American economy can re-expand. This is a debt deflation like unto nothing the world has ever seen before. We've entered the really painful zone of the "work-out" where insolvency can no longer be denied. Things will be heard crashing every day -- enterprises, households, assets, institutions, prospects, deals. No amount of simulus, first, second, or beyond, will avail to stop this process. It's also vitally important to commence public hearings and official investigations of those who committed real crimes and malfeasances. Bernie Madoff has been salted away for two and a half lifetimes, but Henry Paulson is still at large after overseeing the creation of the biggest heap of fraudulent securities the world has ever known -- and then betting against them in the swaps market, in effect shorting his own swindle -- not to mention his misdeeds at the US Deparftment of the Treasury.

"Even the kindest physicians don't put corpses on life support" - James Kunstler

What it comes down to, apparently, is a leadership elite across all sectors -- politics, business, academia, media -- that is incapable of processing the truth, and then conveying it to the broad American public.

Alas, this also appears to be a common theme in history, with a commonly tragic outcome, which is that elites get ruthlessly dumped and replaced by new elites, often composed of zealots, maniacs, nincompoops, and others generally ill-disposed to the able management of complex affairs. It's called the "circulation of elites," and in times of crisis it tends to take on a kind of downward spiraling flavor, with each gang of discredited leaders tossed out for a progressively worse one until a kind of exhaustion is reached -- whereupon the archetypal man-on-a-white-horse arrives on the scene.

Readers think I joke about the Hamptons going up in flames. But the antics of the bankers, hedge funders, the CEOs, the Madoffs, and even the P. Diddy's of our time, are liable to attract murderous attention as the public mood moves from sour to wrathful.

The truth is that we're comprehensively bankrupt, and no amount of shuffling certificates around will avail to alter that.

But grandiosity is just another way that we lie to ourselves about where we're at and what is really possible. - JAMES KUNSTLER

SHOOT: As usual Kunstler paints a startling glimpse of the day after tomorrow. Read more by following the link to his blog immediately below.

clipped from jameshowardkunstler.typepad.com

Kunstler: Pitchforks for sale

So many forces are arrayed against a return to the previous "normal" that we will be lucky, in another eighteen months, to still find ourselves speaking English and celebrating Christmas. What's "out there" is a panorama of mutually reinforcing critical problems pertaining to how we live on this continent. Like the obesity, heart disease, and diabetes that plague the public, these problems are disorders of lifestyle habits and the only possible "cure" is a comprehensive revision of lifestyle.

Since it is that time of year, and I am haunting the gardening shop, one can't fail to notice the many styles of pitchforks for sale. My guess is that the current mood of public paralysis will dissolve in a blur of blood and spittle sometime between Memorial Day and July Fourth, even with Nascar in full swing, and the mushrooming ranks of the unemployed lost in raptures of engine noise and fried cornmeal. It doesn't take too many determined, pissed-off people to create a lot of mischief in a complex society.

SHOOT: I guess even Obama didn't realise to what extent revolutionary change is upon Americans and the rest of the world alike.

clipped from jameshowardkunstler.typepad.com It's a curious symptom of the consensus trance zombifying the American public and its auditors in the media that something like a "recovery" is now deemed to be underway. And, as events compel me to repeat in this space, it begs the question: recovery to what? To Wall Street booking stupendous profits by laundering "risk" out of bad loans with new issues of tranche-o-matic securitized paper? The idea that we're about to resume the insane behavior that induced the current epochal malaise of economy is so absurd it will only be heard in the faculty dining halls of the Ivy League. And if America is not picking up where it left off eighteen months ago -- the orgy of spending future claims on wealth unlikely to accrue -- then what is our destiny? Based on what's out there in the organs of public thinking, it seems that we don't want to think about it.

James Kunstler Discusses New Urbanism in South Africa [PODCAST + PICTURES]

clipped from kunstlercast.com KunstlerCast #58: New Urbanism in South Africa Kunstler Reports on His Recent Trip to Johannesburg James Howard Kunstler reports on two recent trips he took. First he talks about his appearance at the annual Aspen Institute Environmental Forum, where talk of alternative fuel, and other ways to keep our happy motoring scene running, dominated the talks about peak oil. For the remainder of this program Kunstler reports on his recent trip to Johannesburg, South Africa, where he inspected a 35-acre new urbanist neighborhood project. Kunstler describes his urban planning and cultural observations of this region of the world.

James Howard Kunstler - in a Nutshell [SLIDESHOW]

America - Sober Up! [Though you know you won't]

"There is no more moral justification for the private ownership of land than for the private ownership of air or rainfall."

clipped from jameshowardkunstler.typepad.com The political theater of the moment in Washington is not focused on any of this, but on the illusion that we can find new ways of keeping the old ways going. Many observers have noted lately how passive the American public is in the face of their dreadful accelerating losses. It's a tragic mistake to tell them that they can have it all back again. We'll see a striking illustration of "phase change" as the public mood goes from cow-like incomprehension to grizzly bear-like rage. Not only will they discover the impossibility of getting back to where they were, but they will see the panicked actions of Washington drive what remains of our capital resources down a rat hole. This striking poverty of imagination may lead to change that will tear the nation to pieces.

Kunstler: The "Growth'" Blasphemy

NVDL: To summarise:

- anyone you hear (especially politicians and finance ministers) talking about 'growth' from now on is blowing smoke up your arse
- making sentimental gestures such as 'saving' the auto-industry will be exactly that. Sentimental. The auto-industry is past its zenith. Forever.
- the future is about contraction. We have moved past the peak of our civilisation. This has coincided with the peak use of our resources, resources that were always limited.
- the contraction mentioned above refers also to the number of human beings on the planet. As industires shut down, not only will there be fewer jobs, there'll be less of everything.
- we will have to begin to occupy ourselves in activities that make sense, that have practical value. For example growing things, buildings things, and fixing things.

[The] economy is now in its death throes. The "normality" it represents to so many Americans is gone and can't be brought back, no matter how wistfully we watch it recede.

We have to, so to speak, get to place mentally where we can face the kinds of change that are now necessary and unavoidable. We're not there yet. It's not clear whether the elected new national leadership knows just how severe the required changes will really be. Surely the public would be shocked to grasp what's in store. Probably the worst thing we can do now would be to mount a campaign to stay where we are, lost in raptures of happy motoring and blue-light-special shopping.

The economy we're evolving into will be un-global, necessarily local and regional, and austere. It won't support even our current population. This being the case, the political fallout is also liable to be severe. For one thing, we'll have to put aside our sentimental fantasies about immigration. This is almost impossible to imagine, since that narrative is especially potent among the Democratic Party members who are coming in to run things. A tough immigration policy is exactly the kind of difficult change we have to face. This is no longer the 19th century. The narrative has to change.

NVDL: The same applies in South Africa, where we can no longer afford our laissez fair attitude to Zimbabweans streaming over our borders.

The new narrative has to be about a managed contraction -- and by "managed" I mean a way that does not produce civil violence, starvation, and public health disasters.
One of the telltale signs to look for will be whether the Obama administration bandies around the word "growth." If you hear them use it, it will indicate that they don't understand the kind of change we face.

For the rest of this article, go here.

For more articles from James Kunstler, go to:
Bank Zombification
The sclerosis of American life
The Energy Diet of the Future

Kunstler: The Auto-Industry's Kabuki Theatre and the Real Work that lies ahead

We still think that "the path to success" is based on getting a college degree certifying people for a lifetime of sitting in an office cubicle. This is so far from the approaching reality that it will be eventually viewed as a sick joke -- like those old 1912 lithographs of mega-cities with Zeppelins plying the air between Everest-size skyscrapers. - James Howard Kunstler

Kunstler: It is hugely ironic that the US automobile industry is collapsing at this very moment, and the ongoing debate about whether to "rescue" it or not is an obvious kabuki theater exercise because this industry is hopeless. It is headed into bankruptcy with one hundred percent certainty. The only thing in question is whether the news of its death will spoil the Christmas of those who draw a paycheck from it, or those whose hopes for an easy retirement are vested in it.

But American political-economy being very Santa Claus oriented for recent generations, the gesture will be made. A single leaky little lifeboat will be lowered and the chiefs of the Big Three will be invited to go for a brief little row, and then they will sink, glug, glug, glug, while the rusty old Titanic of the car industry slides diagonally into the deep behind them, against a sickening greenish-orange sunset backdrop of the morbid economy.

A key concept of the economy to come is that size matters -- everything organized at the giant scale will suffer dysfunction and failure. Giant companies, giant governments, giant institutions will all get into trouble. This, unfortunately, doesn't bode so well for the Obama team and it is salient reason why they must not mount a campaign to keep things the way they are and support enterprises that have to be let go, including many of the government's own operations.

The best thing Mr. Obama can do is act as a wise counselor companion-in-chief to a people who now have to leave a lot behind in order to move forward into a plausible future. He seems well-suited to this task in sensibility and intelligence. The task will surely include a degree of pretense that he is holding some familiar things together and propping up some touchstones of the comfortable life. But the truth is we are all going to the same unfamiliar new territory.

The economy we're moving into will have to be one of real work, producing real things of value, at a scale consistent with energy resource reality. I'm convinced that farming will come much closer to the center of economic life, as the death of petro-agribusiness makes food production a matter of life and death in America -- as opposed to the disaster of metabolic entertainment it is now.

Reorganizing the landscape itself for this finer-scaled new type of farming is a task fraught with political peril (land ownership questions being historically one of the main reasons that societies fall into revolution). The public is completely unprepared for this kind of change.

The crucial element in the transformation underway will be emotion. The American experience for a few generations has produced an adult population with very childish instincts, increasingly worse each decade. For instance, the desperate power fantasies among the younger tattooed lumpenproles -- those with next-to-zero real economic power -- suggest a certain unappetizing playing-out of resource competition when the supply of Cheez Doodles and Pepsi starts to dwindle.

But even the heretofore gainfully employed middle classes are pretty lost in fantasies at least of comfort an convenience. For years now, I have wondered how their sense of grievance and resentment will be expressed when the supermarket shelves run bare and the cardboard signs get taped over the local gas pump and the cable TV gets cut off for non-payment. You wonder, to put it bluntly, how far gone we really are.

For the first part of this article, go here.

Kunstler: Bank Zombification and why we're not going back to a "consumer" economy

Though Citicorp is deemed too big to fail, it's hardly reassuring to know that it's been allowed to sink its fangs into the Mother Zombie that the US Treasury has become and sucked out a multi-billion dollar dose of embalming fluid so it can go on pretending to be a bank for a while longer. I employ this somewhat clunky metaphor to point out that the US Government is no more solvent than the financial zombies it is keeping on walking-dead support. And so this serial mummery of weekend bailout schemes is as much of a fraud and a swindle as the algorithm-derived-securities shenanigans that induced the disease of bank zombification in the first place.

The main question it raises is whether, eventually, the creation of evermore zombified US dollars will exceed the amount of previously-created US dollars now vanishing into oblivion through compressive debt deflation.

My guess, given the usual time-lag factor, is that the super-inflation snap-back will occur six to eighteen months from now. And the main result of all this will be our inability to buy the imported oil that comprises two-thirds of the oil we require to keep WalMart and Walt Disney World running. At some point, then, in the early months of the Obama administration, we'll learn that "change" is not a set of mere lifestyle choices but a wrenching transition away from all our familiar and comfortable habits into a stark and rigorous new economic landscape.

The credit economy is dead and the dead credit residue of that dead economy is going where dead things go. It came into the world as "money" and it is going out of this world as a death-dealing disease, and we're not going to get over this disease until we stop generating additional zombie money out of no productive activity whatsoever. The campaign to sustain the unsustainable is, besides war, the greatest pitfall this society can stumble into. It represents a squandering of our remaining scant resources and can only produce the kind of extreme political disappointment that wrecks nations and leads to major conflicts between them. I don't know how much Mr. Obama buys into the current adopt-a-zombie program -- his Treasury designee Timothy Geithner was apparently in on this weekend's Citicorp deal -- but the President would be wise to steer clear of whatever the walking dead in the Bush corner are still up to.

All the activities based on getting something-for-nothing are dead or dying now, in particular buying houses and cars on credit and so it should not be a surprise that the two major victims are the housing and car industries. Notice, by the way, that these are the two major ingredients of an economy based on building suburban sprawl. That's over, too. We're done building it and the stuff we've already built is destined to loose both money value and usefulness as the wrenching transition goes forward.

All this obviously begs the question: what kind of economy are we going to live in if the old one is toast? Well, it's also pretty obvious that it will have to be based on activities productively aimed at keeping human beings alive in an ecology that has a future. Once you grasp this, you will see that there is no reason to despair and more than enough for all of us to do, so we can recover from the zombie nation disease and get on with the next chapter of American history -- and I sure hope that Mr. Obama will get with the new program.

To be specific about this new economy, we're going to have to make things again, and raise things out of the earth, locally, and trade these things for money of some kind that we earn through our own productive activities. Don't make the mistake of thinking this is optional. The only other option is to go through a violent sociopolitical convulsion. We ought to know from prior examples in world history that this is not a desirable experience. So, to avoid that, we really have to put our shoulders to the wheel and get to work on things that matter, and do it at a scale that is consistent with what the world really has to offer right now, especially in terms of available energy.

In my view -- and I know this is controversial -- a much larger proportion of the US population will have to be employed in growing the food we eat. There are many ways of arranging this, some more fair than others, and I hope the better angels of our nature steer us in the direction of fairness and justice. The prospects of a devalued dollar imply that we very shortly will not be able to get the all the oil-and-gas based "inputs" that have made petro-agriculture possible the past century. The consequences of this are so unthinkable that we have not been thinking about it. And, of course, the further implications of current land-use allocation, and the property ownership issues entailed, suggests formidable difficulties in re-arranging the farming sector. The sooner we face all this, the better.

My guess is that we will get the electricity for doing this mostly from water. It may actually be too late -- from a remaining capital resources point-of-view -- to ramp up a new phase of the nuclear power industry (and there are plenty of arguments from the practical and economic to the ethical against it).

I would hasten to warn readers (again!) that we'll probably have to do these things more modestly too (don't count on giant wind "farms"), and that we are liable to be disappointed by what they can actually provide for us (don't expect to run WalMart on wind, solar, algae-fuels, etc).

In any case, we're not going back to a "consumer" economy. We're heading into a hard work economy in which people derive their pleasures and gratification more traditionally -- mainly through the company of their fellow human beings (which is saying a lot, for those of you who have forgotten what that's about). Our current investments in "education" -- i.e. training people to become marketing executives for chain stores -- will delude Americans for a while about what kind of work is really available. But before long, the younger adults will realize that there are enormous opportunities for them in a new and very different economy. We will still have commerce -- even if it's not the K-Mart blue-light-special variety -- and the coming generation will have to rebuild all the local, multi-layered networks of commercial inter-dependency that were destroyed by the rise of the chain stores. In short, get ready for local business. It will surely be part-and-parcel of our local food-growing and manufacturing activities.

I hate to keep harping on this -- but since nobody else is really talking about it, at least in the organs of public discussion, the job is left to me -- we have to get cracking on the revival of the railroad system in this country, if we expect to remain a united country. This is such a no-brainer that the absence of any talk about it is a prime symptom of the zombie disease that has eaten away our brains. Automobiles (the way we use them) and airplanes are utterly dependent on liquid hydrocarbon fuels, and you can be certain we'll have trouble getting them.

You can run trains by other means -- electricity being state-of-the-art in those parts of the world that do it most successfully. I know that California just voted to create a high-speed rail link between Los Angeles and San Francisco. It's an optimistic sign, but it shows more than a little techno-grandiose over-reach. High speed rail would require a mega-expensive re-do of the tracks. We need to scale our ambitions for this more realistically. California (and every other region of America) would benefit much more from normal-speed trains running every hour on the hour on tracks that already exist than from a mega-expensive, grandiose sci-fi program that might not get built for ten years. The dregs of the Big Three automakers can and should be reorganized to produce the rolling stock for a revived railroad system.

Even amidst the financial carnage underway right now, the public is enjoying a respite from high-priced gasoline, but it is due to be short-lived. As I've already said, we are in danger not just of oil prices going way back up again, but of losing access to our supplies from the exporting countries. In other words, we're just as likely to face shortages as high prices, and soon. Oil shortages are certain to produce a political freak-out here unless we get our heads screwed on right -- and this means that Mr. Obama had better prepare quickly for a comprehensive action plan in the face of such an emergency (which has to include a robust public information initiative).

In the meantime, Mr. Obama must dissociate himself from all activities aimed at the care-and-feeding of zombies. Mr. Obama is correct that there is one president and one government at a time, and since this is the case in reality, he must avoid being contaminated by the choices they make as their clock ticks out. Obviously, world markets might be more disturbed if Mr. Obama were to step up and actively contradict everything that is being done to cultivate zombies right now. He is in a very delicate position. But being a man of intelligence and sensibility, he may successfully navigate this rough passage.

That this melt-down is building straight into the Christmas holidays is one of those accidents of history that leaves one reeling in wonder and nausea. The cable networks better be prepared to bombard the public with round-the-clock showings of It's A Wonderful Life, because they're going to need all the moral support they can get as zombies stalk through the silent night, holy night.

Kunstler: The sclerosis of American life is shocking

Everywhere you turn in this nation, you see a society primed for implosion. We seem unaware how extraordinary the American experience has been, especially in the last hundred years. By this, I don't mean that we are a better people than any other society -- these days, ordinary people in the USA make an effort to appear thuggish and act surly, as though we were a nation of convicts -- but for decade-upon-decade, we were very fortunate. Even the Great Depression of the 1930s may seem like a relatively peaceful and gentle "time out" from a frantic era of hypertrophic growth, compared to the storm we're sailing into now.

NVDL: America is a nation of places not worth caring about. The world is filled with cities and eyesores not worth caring about, and so it's no surprise that we don't.

We were fortunate to inhabit a New World filled with productive land, lots of minerals, and plenty of coal, oil, and gas; and the land itself was insulated physically from the great theaters of 20th century conflict, though we fought in wars "over there." That experience itself, especially our victory over manifest evil in the Second World War, left us with a dangerous mentality of triumphal exceptionalism. Even now, we think we are immune to the epochal hazards of history. The notion that nothing really bad can happen to us is reflected in the blind cluelessness of our current news media and their simple failure to report what is now happening.

I drove up along an obscure stretch of the upper Hudson river on Sunday, starting in the old factory town of Cohoes, north of Albany, where the Mohawk River runs into the Hudson. There is a powerful waterfall there, and along the high bank the massive old red-brick Harmony Mill still stands with its Victorian towers and mansard roofs, like a vision from an Alfred Hitchcock movie. Behind them are streets of red-brick, three-story worker row-housing from the same period. Today they are inhabited by a different kind of poor people, not necessarily working, and probably suffering from a sheer lack of structure in their lives as well as plain poverty of means. These are people who probably don't follow the Bloomberg financial bulletins, and their experience of a cratering economy may only be the rising cost of cigarettes and beer.

The tattoo quotient among both men and women there is impressive. In the days when the Harmony Mill was built, only South Seas cannibals and sailors wore tattoos. You wonder: are tattoos now the only way left for this class of Americans to assert their selfhood? And what exactly are they proclaiming? I am a warrior. Or is it: I am a television (I display pictures, too) !? The expanding class of the poor-and-idle has been remarkably passive in the face of their dwindling prospects. Perhaps they passed the point years ago (a generation or two ago!) when there was any sense of sequential improvement for the family's station-in-life. The destiny of their everyday lives must seem totally beyond their control. They are subject to the fate of distant corporations who sell the staple corn-syrup byproducts and gasoline on which daily life is based. Where government is concerned, they are all potential victims of Katrina-ism, awaiting their own personal disaster.

North of the junction of the Mohawk and Hudson was the old town of Waterford, where the Erie Canal began its journey west -- bypassing those powerful waterfalls. The locks are still there and still in operation for the infrequent tanker ships and ore barges that come and go to the Great Lakes. But the operation of the canal system is automated to the extent that it requires only a handful of people to run the locks now, and the town around them has deteriorated into slum and semi-slum garnished with a few convenience stores and pizza shops. There is no other commerce there. No matter how poor, the denizens are required to drive a car to a giant chain store for groceries or hardware or clothing.

As you leave Waterford, the river road becomes a suburban corridor of 1960s-vintage ranch houses and stand-alone small retail business buildings which, if used at all now, are mostly hair salons, chiropractic studios, and other services not generally rendered by the chain stores. All this stuff was deployed along the road with the expectation that Americans would be driving cars cheaply forever. Now that this is distinctly no longer the case, corridors like this are entering their death throes. The awfulness of the design and construction of these buildings is now especially vivid as the plywood de-laminates, and the vinyl soffits fall off, and the dinge of neglect forms a patina over it all. Hopelessness infects this landscape like a miasma. Whatever young adults remain in these places are not thinking about a plausible future, only looking to complete their full array of tattoos and lose themselves in raptures of sex, methedrine, and video aggression.

Eventually, after running through the disintegrating towns of Mechanicville (once a place of earnest labor, just like it sounds, now a morass of sinking car dealerships and Quik-stops), and Stillwater (smaller version of the same), the road turned completely rural and few other cars ventured up there. The decisive Revolutionary battle of Saratoga was fought near there on the bluffs and hills overlooking the Hudson in 1777. You wonder what the heroes of that battle would think of what we have become. What would they make of the word "consumer" that we use to describe our relation to the world? What would they think of excellent river bottom-land that is now barely used for farming -- or, where it is still farmed (dairying if anything), of farmers who will not even put in a kitchen garden for themselves because it might detract from their hours of TV viewing?

The sclerosis of American life is shocking. If you go further north up the Hudson River, to Fort Edward and Hudson Falls, you'll see a nation that seems ready to crawl off and die. There, it appears too far gone to even put up a proxy fight on a video screen. Frankly, I don't want that version of America to survive -- the America of chain stores, and muscle cars, and grown men obsessed with video games, drugs, and pornography, and women decorated like cannibals, and the vast, crushing purposelessness of it all. I have no doubt we're heading into a convulsion that will wring much of this junk and dross into the backwaters of history. We're capable of being something better than this, of putting our time on earth to better use, including a more respectful treatment of the land we inhabit. This year and the next will be the years of letting go, and out of that we'll commence a re-becoming.

Kunstler: Where We're At

Every time I saw a car towing a motorboat this holiday weekend, I wondered what was going through the head of the towee. Did they have a sense that darkness was falling on their careers in motor sports? Did they have an inkling that an oil-and-gas crisis is upon us and just not give a shit? Or were they just going through the motions, following some implacable rote programming induced by, say, forty-odd years of TV addiction and a diet based on corn-syrup byproducts?

The holiday to me was a creepy hiatus from an ever more desperate reality overtaking the nation like a miasma. Meanwhile, the mainstream media's ongoing narrative has gotten stuck in the moronic groove of "drill drill drill." The belief of people like Larry Kudlow of CNBC and uber-mega-idiot John Stossel of ABC-News is that we could go back to $1.50 gasoline if only congress would open the offshore exploration areas and the Arctic National Wildlife Refuge. This view is just plain erroneous. Nothing we get out of these regions will come close to offsetting the ongoing depletion of worldwide oil resources, or even arresting our own losses.

Larry King had a particularly dreary debate Sunday night between Robert F. Kennedy, Jr., and a grab bag of "drill drill drill" advocates. Kennedy took the position that the US could achieve a sort of energy independence by massive deployments of wind and solar equipment. It's an understandable wish, I suppose, but not something I view as consistent with reality. The unfortunate part of the Larry King presentation is that it gives the public an idea that these two fantasies are the only possible responses to our predicament. No one is interested in changing our current behavior.

In the background of these energy conundrums is the sickening spectacle of the nation's fatal insolvency, which remains partially disguised by the machinations of the Federal Reserve, using the various new loan "windows" to maintain the illusion that the major banks have not swindled themselves out of existence -- and in doing so, caused at least $3 trillion (so far) in capital to vanish in a black hole. This three-card-monte game has gone on for a whole year now, and the consequences are hitting home. No more money can be lent into existence now.

One consequence is that other nations sitting on our exported dollars (from our massive trade deficit) have apparently decided to spend off those dollars rather than wait for the fullblown financial collapse of the nation issuing them. My guess is that they are spending those dollars on oil, the primary resource of industrial economies, and that they are prepared to outbid other contestants (including the USA) no matter what -- because they know the dollar is losing value, and that those losses are apt to accelerate over time, and what else would they spend them on? I suspect this is behind the rising price of oil more than anything else -- certainly more than the phantom "speculators" the right wing is yelling about -- and that behind the spending off of those exported dollars are the geological facts of oil being a finite resource inequitably distributed around the world.
But to get back to my prior point, things are hitting home anyway, and with force. The US economy is crumbling because the way we conduct the activities of daily life is insane relative to our circumstances. We've spent sixty years ramping up a suburban living arrangement that has suddenly entered a state of failure, and all its accessories and furnishings are failing in concert. The far-flung McHouse tracts are becoming both useless and worthless in the face of gasoline prices that will never be cheap again. The strip malls and office "parks" are following the residential real estate off a cliff. The retail tenants of all those places are hemorrhaging customers who have maxed out every last credit card. The lack of business is now leading to substantial layoffs. The airline industry is dying and will probably cease to exist in its familiar form in 24 months. The trucking industry is dying, threatening the entire just-in-time distribution system of things that even people with little money to spend still need, like food.

These conditions will now get a lot worse, no matter whether the banks continue to conceal their problems. All of it leads to an inflection point that coincides with the November election. By then, I expect that quite a few banks will be toast, job layoffs will rise spectacularly, foreclosures and bankruptcies will be raging across the land, and homeowners north of the magnolia belt will be shattered by the cost of staying warm this winter.

All this hardship and woe will be blamed on the Republican party. It may actually kill off the party. Political parties do go out-of-business in American history, and this one deserves to die -- with its aggressive no-nothingism, its avaricious, punitive religious extremism (the religious part often being fake), its stunning inattention to financial malfeasance in areas under its direct supervision, and its gross incompetent mismanagement of the nation's strategic interests.

That said, I will feel a little sorry for Mr. Obama if he gets to the White House. He'll have to find a gentle way to tell the truth to the people who elected him, people who will be suffering mightily, and who will be very sore about their losses. He'll have to tell them that the previous "release" of the American Dream software is obsolete, and the new version will require a whole lot more of them in the way of earnest effort, delayed gratification, and revised expectations.

There's a whole lot we can do to greet the new circumstances awaiting us, but the one thing we can't afford to do is put all our efforts into keeping the current system running as is. Reality simply won't permit it. We would squander our dwindling remaining resources trying to keep it all going. The next president is going to have to lead us through the awful process of cutting our losses. So far, the debate has been about how to avoid that.

NVDL: Here's what happened in the US markets today: U.S. bank shares plummet amid stability fears

"It's the cockroach theory. You don't just have one bank failure -- when you have a big bank go under, there's always more than one," said James Ellman, president of hedge fund Seacliff Capital, who is short some financial stocks.

Futureshock: people with no money in a land with no resources (with manpower that has no discipline)

And by future I mean next week, and the week after that etc.

Kunstler: Worse Than Grandma's Depression

This isn't so funny anymore. Intimations of a July banking collapse rumbled though the Internet this weekend while mainstream news orgs like The New York Times and CNN pulled their puds over swift boats and Amy Winehouse's performance technique. Something is happening, and you don't know what it is, do you Mr. Jones...? to quote the master.

What's happening is that American society is sliding into a greater depression than the one Grandma lived through. On the technical side, there has been unending controversy as to whether we're gripped by inflation or deflation. It's certainly deceptive. Food and gasoline prices are rising faster than the rivers of Iowa. But the prices of assets, like houses, stocks, jet-skis, GMC Yukons and pre-owned Hummel figurines are cratering as America turns into Yard Sale Nation.

We're a very different country than we were in 1932. In that earlier crisis of capital, few people had any money but our society still possessed fantastic resources. We had plenty of everything that our land could provide: a treasure trove of mineral ores and the equipment to refine it all, a wealth of oil and gas still in the ground, and all the rigs needed to get at it, manpower galore (and of a highly disciplined, regimented kind), with fine-tuned factories waiting for orders. We had a railroad system that was the envy of the world and millions of family farms (even despite the dust bowl) owned by people who retained age-old skills not yet degraded by agribusiness. We had fully-functional cities with operating waterfronts and ten thousand small towns with local economies, local newspapers, and local culture.

We had a crisis of capital in the 1930s for reasons that are still debated today. My own guess is a combination of a bad debt workout that sucked "money" into a black hole (since money is loaned into existence, but vanishes if the loans are not systematically paid back) plus a gross saturation of markets, meaning that every American who had wanted to buy a car or an electric toaster had done so and there was no one left to sell to. (The first round of globalism -- 1870 - 1914 -- had shut down after the fiasco of World War One.)

Our debt problems today are of a magnitude so extreme that astronomers would be hard pressed to calculate them. By any rational measure our society is comprehensively bankrupt. From the federal treasury down to the suburban cul-de-sacs so much loaned money is either not being paid back, or is at risk of never being paid back, that the suckage of presumed wealth has passed through an event horizon out of the known universe into some other realm of space-time, never to be seen again in this realm. This would seem to be the very essence of monetary deflation -- money defaulted out-of-existence.

This condition is partly disguised by both the loss of credibility of US currency and real-world scarcities of oil and food, but the upshot will be something at least twice as bad as the Great Depression of the 1930s: people with no money in a land with no resources (with manpower that has no discipline), hardly any family farms left, cities that are basket-cases of bottomless need, comatose small towns stripped of their assets and social capital, an aviation industry on the verge of death, and a railroad system that is the laughingstock of the world. Not to mention the mind-boggling liabilities of suburbia and the motoring infrastructure that services it.

The banks have been doing their death dance for an entire year now, pretending that their problems are those of mere "liquidity" (i.e. cash-on-hand) rather than insolvency (no cash either on hand or in the vault and nothing else to sell to raise cash except worthless "creative" securities that nobody would ever buy). But the destruction of money (resulting from loans not paid back) is now so intense that the game of pretend has reached its terminal point. The question for the moment is exactly who and what will be crushed as these institutions roll over and die.

Complicating matters is a global oil predicament that is really not hard to understand, but which the organs of news and opinion have obdurately failed to explicate for an anxious public. Call it Peak Oil. There are only a few elements of it you need to know. 1.) that demand has now permanently outstripped supply; 2.) that new discoveries are too meager to offset consumption; 3.) That under under the circumstances, the systems we rely on for daily life are crumbling. I've called this situation The Long Emergency.

Our chances of mitigating this, and of continuing our current way-of-life is about zero. I've tried to promote the idea that rather than waste remaining resources in the futile attempt to sustain the unsustainable (i.e. come up with "solutions" to keep suburbia running), that we should begin immediately making other arrangements for daily life -- mainly by downscaling and re-scaling everything from farming to commerce to the way we inhabit the landscape -- but my suggestions have proven unpopular even among the "environmental" elites, who are too busy being entranced by new-and-groovy ways to keep all the cars running.

So where we are at now is the equivalent of standing in the slop by the ocean shore under a gathering hundred-foot-high wave that is about to come crashing down on our heads. Since I sure don't know everything, I can't say how this will all play out in the months ahead, especially with the presidential election coming at the exact moment that voters will be turning on their furnaces for the cold and dark winter beyond. I would venture to say that so far our society as a whole has done a piss-poor job of comprehending the situation. [I agree] But there is still the possibility, with four months of politicking left, that the nature of our predicament can be articulated in a way that few can fail to understand, the way Mr, Lincoln articulated the terms of the Civil War on the eve of its fateful outbreak.

Oil: Kunstler on the Energy Diet of the Future (YOUTUBE)

NVDL: James Kunstler probably has the best view in all oil commentary that exists today.

"I worry the most about [coming] social disorder...It's imperative that we restore passenger rail services." - Jim Kunstler

"America has become little more than an energy protection force, doing anything to gain access to expensive fuel without regard for the lives of others or the earth itself." -Bill Moyers quoting political analyst Kevin Phillips

BILL MOYERS: Oh no, they told us, Iraq isn't a war about oil. That's cynical and simplistic, they said. It's about terror and al Qaeda and toppling a dictator and spreading democracy and protecting ourselves from weapons of mass destruction. But one by one, these concocted rationales went up in smoke, fire, and ashes. And now the bottom turns out to be the bottom line. It is about oil.

Alan Greenspan said so last fall. The former Chairman of the Federal Reserve, safely out of office, confessed in his memoir: "…everyone knows: the Iraq war is largely about oil." he then told reporter Bob Woodward, "if Saddam Hussein had been head of Iraq and there was no oil under those sands, our response to him would not have been as strong as it was in the first Gulf War."

Remember, also, that soon after the invasion Donald Rumsfeld's deputy, Paul Wolfowitz, told the press that war was our only strategic choice. "We had virtually no economic options with Iraq," Wolfowitz said, "because the country floats on a sea of oil."

Shades of Daniel Plainview! You remember Plainview - the monstrous petroleum tycoon in the movie "There Will Be Blood." Half-mad, he shouts: "there's a whole ocean of oil under our feet!" then adds, "no one can get at it except for me!"

No wonder American troops only guarded the Ministries of Oil and the Interior in Baghdad, even as looters pillaged museums of their priceless antiquities. Our soldiers were making sure no one could get at the oil except…guess who?

Take a look at this headline the other day in THE NEW YORK TIMES: "deals with Iraq are set to bring oil giants back." Read on: "Four western oil companies are in the final stages of negotiations this month on contracts that will return them to Iraq, 36 years after losing their oil concession to nationalization as Saddam Hussein rose to power."[This blog quoted earlier this week from the same article]

There you have it. After a long exile Exxon Mobil, Shell, Total and BP are back in Iraq. And on the wings of no-bid contracts - that's right, sweetheart deals like those granted Halliburton, KBR, Blackwater. The kind of deals you get only if you have friends in high places. And these war profiteers have friends in very high places.

Let's go back a few years, to the 1990s, when private citizen Dick Cheney was running Halliburton, the big energy supplier. That's when he told the oil industry that, "By 2010 we will need on the order of an additional fifty million barrels a day. So where is the oil going to come from?" Cheney asked. While many regions of the world offer great oil opportunities, the Middle East...is still where the prize ultimately lies."

Fast forward to Cheney's first heady days in the White House. The oil industry and other energy conglomerates have been handed back-door keys to the white house, and their CEOs and lobbyists were trooping in and out for meetings with their old pal, now Vice President Cheney. The meetings are secret, conducted under tight security. But as we reported in July 2003, among the documents that turned up from some of those meetings were maps of oil fields in Iraq and a list of companies that wanted access to them. The conservative group Judicial Watch and the Sierra Club filed suit to find out who attended the meetings and what was discussed. But the White House fought all the way to the Supreme Court to keep the press and public from learning the whole truth.

Think about it. These secret meetings took place six months before 9/11, two years before Bush and Cheney invaded Iraq. We still don't know what they were about. What we know is that this is the very oil industry enjoying swollen profits these days. It would be laughable if it weren't so painful to remember that their erstwhile cheerleader for invading Iraq - the press mogul Rupert Murdoch - once said that a successful war there would bring us $20 a barrel oil. The last time I looked, it was more than $140 a barrel. Where are you, Rupert, when we need the facts?

[It's a mistake to blame oil companies, and also a mistake to take away their profits. Good oil companies need to invest these profits into new projects, and with oil depletion the way it is, these investments need to be increasingly massive and well conceived. I don't think we ought to blame oil companies for seeking to get a pipeline into underutilised oil fields, however I do disagree with the method used, namely war and deception. Iraq's promised bounty may have been better extracted by an allied team of Iraqi and American oil men and others, as is the case with Arabia's Aramco. The Iraq case appears to me to be beyond mere 'policing' oil, as Kunstler refers to it, but actually a power-and greed based grab by the Americans...which has proved to be very expensive for not only America as a nation, but arguably the world...in terms of not just oil prices, but global security.]

At those hearings earlier this week, scientist James Hansen, who 20 years ago alerted us to the dangers of global warming, compared the chief executives of big oil to the tobacco moguls who denied that nicotine is addictive or that there's a link between smoking and cancer. Hansen said these barons of black gold should be tried for committing crimes against humanity and nature in opposing efforts to deal with global warming.

Perhaps those sweetheart deals in Iraq should be added to his proposed indictments. They have been purchased at a very high price. Four-thousand American soldiers dead, tens of thousands permanently wounded for life, hundreds of thousands of dead and crippled Iraqis plus five million displaced, and a cost that will mount into trillions of dollars. The political analyst Kevin Phillips says America has become little more than an "energy protection force" doing anything to gain access too expensive fuel without regard to the lives of others, or the earth itself. One thinks again of Daniel Plainview, in "There Will Be Blood". His lust for oil came at the price of his son and his soul.

I'm Bill Moyers.
Watch the video here.
More.

Kunstler: Crunch Time

A catastrophe for Iowa farmers will not be just a catastrophe for Midwestern Americans. In the Iowa floods, we'll see more evidence of how the problems of weird weather (climate change) combine and ramify the problems associated with peak oil.[I made exactly this point earlier today. Actually the breadbasket of America is very much part and parcel of the basket for the world's bread.] In this particular case they lead to an inflection point sometime around the 2008 harvest season, which will also be our time of political harvest.

These are not your daddy's or granddaddy's floods. These are 500-year floods, events not seen before non-Indian people starting living out on that stretch of the North American prairie. The vast majority of home-owners in Eastern Iowa did not have flood insurance because the likelihood of being affected above the 500-year-line was so miniscule -- their insurance agents actually advised them against getting it. The personal ruin out there will be comprehensive and profound, a wet version of the 1930s Dust Bowl, with families facing total loss and perhaps migrating elsewhere in the nation because they have no home to go back to.

Iowa in 2008 will be an even slower-motion disaster than Hurricane Katrina in 2005. Beyond the troubles of 25,000 people who have lost all their material possessions is a world whose grain reserves stand at record lows. The crop losses in Iowa will aggravate what is already a pretty dire situation. So far, the US Public has experienced the world grain situation mainly in higher supermarket prices. Cheap corn is behind the magic of the American processed food industry -- all those pizza pockets and juicy-juice boxes that frantic Americans resort to because they have no time between two jobs and family-chauffeur duties to actually cook (note: reheating is not cooking).

Behind that magic is an agribusiness model of farming cranked up on the steroids of cheap oil and cheap natural-gas-based fertilizer. Both of these "inputs" have recently entered the realm of the non-cheap. Oil-and-gas-based farming had already reached a crisis stage before the flood of Iowa. Diesel fuel is a dollar-a-gallon higher than gasoline. Natural gas prices have doubled over the past year, sending fertilizer prices way up. American farmers are poorly positioned to reform their practices. All that cheap fossil fuel masks a tremendous decay of skill in husbandry. The farming of the decades ahead will be a lot more complicated than just buying x-amount of "inputs" (on credit) to be dumped on a sterile soil growth medium and spread around with giant diesel-powered machines.

Like a lot of other activities in American life these days, agribusiness is unreformable along its current lines. It will take a convulsion to change it, and in that convulsion it will be dragged kicking-and-screaming into a new reality. As that occurs, the US public will have to contend with more than just higher taco chip prices. We're heading into the Vale of Malthus -- Thomas Robert Malthus, the British economist-philosopher who introduced the notion that eventually world population would overtake world food production capacity. Malthus has been scorned and ridiculed in recent decades, as fossil fuel-cranked farming allowed the global population to go vertical. Techno-triumphalist observers who should have known better attributed this to the "green revolution" of bio-engineering. Malthus is back now, along with his outriders: famine, pestilence, and war.

We're headed, it seems, toward a fall "crunch time," and that crunching sound will not be of cheez doodles and taco chips consumed on the sofas of America. I think we're heading into a season of hoarding.

NVDL: I did a grocery shop yesterday, and aware as I am of the impending fuel price hikes, it occurred to me to stock up on tinned food, and build up some sort of long term food cushion. The thought just drifted into my consciousness. If I am thinking about that, God knows everyone else is about to - Kunstler is spot on that we're about to enter a season of hoarding...and from there, we're not from anarchy.

As the presidential campaign moves into its final round, Americans may be hard-up for both food and gasoline. On the oil scene, the next event on the horizon is not just higher prices but shortages. Chances are, they will occur first in the Southeast states because oil exports from Mexico and Venezuela feeding the Gulf of Mexico refineries are down more than 30 percent over 2007.

Perhaps more ominous is the discontent on the trucking scene. Truckers are going broke in droves, unable to carry on their business while getting paid $2000 for loads that cost them $3000 to deliver. In Europe last week, enraged truckers paralyzed the food distribution networks of Spain and Portugal. The passivity of US truckers so far has been a striking feature of the general zombification of American life. They might continue to just crawl off one-by-one and die. But it's also possible that, at some point, they'll mount a Night-of-the-Living-Dead offensive and take their vengeance out on "the system" that has brought them to ruin. America has only about a three-day supply of food in any of its supermarkets.

The yet-more-ominous thing here is that shortages of food and oil are two fiascos that are pretty clearly predictable for the second half of the year. That's bad enough without figuring in the "unknowns" that could kick up American hardship a few more notches.The hurricane season just got underway -- obscured for the moment by the bigger weather story in Iowa. The fate of the banks is a train wreck still waiting to happen. As it occurs -- also heading into the high political and hurricane seasons -- we could find ourselves not only a nation wet, hungry, and out-of-gas, but also completely broke. I'm sorry that Tim Russert will not be here to talk us through it all.

NVDL: H5N1 is another curve ball waiting to catch our species while we're looking the other way.

Kunstler Quote

We will not believe that this is happening to us, that 200 years of modernity can be brought to its knees by a world-wide power shortage. The survivors will have to cultivate a religion of hope -- that is, a deep and comprehensive belief that humanity is worth carrying on. If there is any positive side to stark changes coming our way, it may be in the benefits of close communal relations, of having to really work intimately (and physically) with our neighbors, to be part of an enterprise that really matters and to be fully engaged in meaningful social enactments instead of being merely entertained to avoid boredom. Years from now, when we hear singing at all, we will hear ourselves, and we will sing with our whole hearts.

Kunstler: Feeling Good Are Ya?

...all the backward-looking crybaby complaints that "we were lied to" still does not answer the basic question: what should have been the appropriate response to the extreme injury of 9/11? A diplomatic protest? An investigation by the UN? The surreptitious assassination of Arab troublemakers all around the world? I don't think the "we were lied to" contingent has a credible answer to this question.

There's another hugely important realm of inquiry that the "we were lied to" folks have never addressed: who lied to us about the way we live in this country? About the amount of oil we consume in the service of all our comforts and conveniences? About our extreme car dependence and what is required in our relations with the rest of the world to sustain it. All these years, Frank Rich and all his whining colleagues at the New York Times barely acknowledged the domestic fiasco of the suburban sprawl economy that placed us in such jeopardy to begin with. Even now, with the airlines disintegrating and gasoline over $4 (diesel over $5) I haven't heard any of these crybabies even raise the issue of restoring the US railroad system. How many of these crybabies live suburban lives themselves, in places like Louden County, Virginia, or Westchester, or Long Island, or the San Fernando Valley? Who lied to us about that?

For my money, the "we were lied to" chorus only represents the obdurately self-righteous cluelessness in every band of the American political spectrum. We lied to ourselves. We continue to lie to ourselves every day. The US public barely understands the first thing about the energy predicament we're in, and what it means for how we live in this country -- or how we get along with the rest of the world -- and the news media tragically reflects that ignorance. We fantasize about being "energy independent" and still being able to drive to the mall three times a day to eat caesar salads grown on the other side of North America. Get this: we deserve what is exactly happening to us. We might as well keep on lying to ourselves to pretend that we are not descending into a dark time. After all, the true basis of American life these days is to feel good about yourself no matter what you do.

Kunstler: The Risk Economy

As the West's industrial regime sputters toward a cheap-energy-crackup conclusion, there have been attempts to recast what our economy is actually about, how to account for whatever wealth we manage to produce, and project what our society will actually be organized to do in the years ahead.

For a while in the 1990s, the idea was a "service economy," kind of like the old fable of the town whose inhabitants made a living by taking in each other's laundry -- only in our case it was selling hamburgers to tourists on vacation from their jobs making hamburgers elsewhere, or something like that.

Then came the idea of the "information economy" in which making things of value would no longer matter, only the processing and deployment of information (sometimes misidentified as "knowledge"). This model seemed to suggest a yin-yang of software engineers who made up games like "Grand Theft Auto" serving the opposite cohort of people who bought and played the game. If nothing else, it certainly explained how lifetimes could be frittered away on stupid activities.

That illusion yielded to the housing bubble economy, which actually did produce a lot of things, but not necessarily of value -- for instance, houses made of particle board and vinyl 38 miles outside of Sacramento. It was a tragic and manifold waste of resources, as well as an insult to the landscape. But the darker side of the housing bubble lay in the world of finance, where a vast empire of swindles was constructed to support the Potemkin facade of production homebuilding.
Now we are in a strange period when those swindles are unwinding. The people who run the finance sector -- the Wall Street investment banks, hedge funds and ratings agencies, the Federal Reserve, and the US Dept of the Treasury -- in desperately trying to prevent the unwind, have rapidly ramped up another new economy based entirely on the buying and selling of risk. Risk, as a pure abstraction unconnected to any real capital activity, is all that's left to buy and sell after all other plausibly practical vehicles for finance have failed.

While a lack of transparency in the individual risk vehicles has been an object of complaint over the past year, the system as whole is transparently absurd. The system is also abstruse enough to prevent most mortals (including many employed in the system) from understanding its operations. But the general public and the news media are virtually helpless to intervene in this last gasp racket, so the probability increases that it will do tremendous damage to whatever remains of the US economy.

One feature of the risk economy is the Federal Reserve's new willingness to absorb any sort of crap collateral in exchange for massive cheap loans to insolvent companies and institutions. The Fed has, in effect, made itself the world's largest financial shit-magnet. It has already taken in a few hundred billion in securities based on non-performing real estate loans, and has now opened the window to securities based on non-performing credit card debt, car loans, and other miscellaneous IOUs still drifting un-hedged in the banking ether.

It's a mark of our collective desperation to avoid the consequences of so much reckless behavior that no credible authorities have stepped up to denounce this racket -- no Fed governor, no politician of standing (including the candidates for president), no newspaper-of-record. The Attorney-general of New York, Andrew Cuomo, may be quietly cooking up some cases in the deep background, but the SEC and the federal banking regulators hung up their "out-to-lunch" signs on this long ago.

Meanwhile, the basic situation is this: the world is awash with bad investment paper. The standard of living in the US can't be supported on debt anymore. The people of the US don't produce enough real value to service their debts. Institutions can no longer be supported on debt gone bad. Something's got to give -- meaning something has to bring the US standard of living down to a level consistent with our declining actual wealth.

Everything else going on right now is a dodge. The Fed maneuvers, the "coordinated actions" of the western central banks, the postponements of default, the non-disclosure of contents in bank portfolios, the pretense that risk alone is a kind of fungible resource that can be endlessly traded to generate fees -- all this fucking nonsense will only make the eventual unwinding much worse.
Personally, I doubt that it can go on more than a few more months. The velocity of everything is going up past the "red line" where things really fly apart. The increased velocity of non-performing mortgages and deadbeat credit card accounts is one thing that can't be hidden or escaped. America will feel and see very vividly when the repossession teams rush families from their homes, when the pickup truck is taken away, and when the pink slip appears in the pay envelope. Meanwhile all the higher-end banking shenanigans will only debase the dollar and make it more difficult for people already in distress to buy gasoline and food.

If the bankers and treasury officials collude to prop up one more failing big bank a la Bear Stearns, the political fallout for Wall Street could be lethal. In any case, I think we will have a way different sense of ourselves as a society by the time the election comes.

NVDL: This Business Day article is interesting:

Standard Bank said the recent trends in South African house price growth, when compared to trends in the US, could at first glance seem ominous for the outlook for South African residential property.

"Increasingly, there are comparisons being made between the subprime-induced housing recession in the US housing market and the current challenging conditions facing the South African housing market.

"Given the dismal house price growth currently being experienced in SA, the question of whether or not the South African housing market will experience a deep recession similar to that being experienced in the US housing market is being asked with increasing frequency.

"However, our analysis of the sources of the recession in the US housing market and its subsequent transmission mechanism to the rest of the US economy suggests that South African residential property will experience a relatively mild cyclical downturn rather than a full blown recession," Standard Bank said.

No, this ain't no mild cyclical downturn, but expect to hear a lot of 'experts' kidding themselves and us that this is the case. Peak Oil means that the conditions we experience now will gradually and intractably worsen, meaning we are by and far heading for a full blown recession along with all that entails: unemployment, crime, shortages, and general austerity. What makes this scenario bleak is we will see it from Johannesburg to Georgia, from Peru to Paris, and everywhere in between. We will see petrol prices going up by another 50 cents in two days, and our petrol pumps are not even geared to deal with so many digits. Neither, apparently, are our hearts and minds.

I predict that for the next few seasons communities are increasingly going to play catch-up to the actual state of affairs, turning to experts and pundits, presidents and hopefuls, in the skewed hope that good news has anything to do with what will actually happen. The people to turn to now are those with a new lease on life, those who are doing something different - it might be farming, or acquiring or building alternative energy systems or otherwise investing in new forms of technology, those who have started to radically change their lifestyles (what they eat), even their jobs.

In the end, reality speaks better than any man.