A quick addendum to my note yesterday: I should have mentioned that new commenters or existing commenters using altered info for the first time, like a slightly tweaked username or a different email address, will get stuck in moderation. I’ll liberate those comments as soon as I spot them.
Also, the provider for my personal email address to which this website links, is allergic to gmail. I have no idea why. Emails from gmail accounts reach me but when I try to reply to them, I get a âmailer daemonâ note back informing that delivery has failed. So, if you have emailed me from a gmail address and I have appeared to rudely ignore you then this is why. My apologies for that. I don’t know how to solve it.
“Climate change is the next shock coming for the global economy, and markets are in for a sharp adjustment, according to the Chatham House [picture from floods in Nova Scotia].
“The London-based think tank warned of a series of disasters that could occur as the climate crisis worsens. Food inflation, for one, could rise as crops fail in higher temperatures. Diseases that thrive in hot environments, such as Ebola and monkeypox, could also spread as climate change worsens.”
“Cracks in the system.
“The sudden and simultaneous failures of Silicon Valley Bank in America and Swiss giant Credit Suisse in March 2023 raised the spectre that has haunted regulators ever since the Great Financial Crisis of 2008: Just how safe are the worldâs banking giants and the global financial system? …not as safe as we all thought.”
https://www.worldfinance.com/special-reports/cracks-in-the-system
“Why entire societies can suffer panic attacks…
“…as anyone who has experienced a panic attack knows, fear of another panic can be self-reinforcing. We need to appreciate that if a societal panic is triggered, the pace at which confidence may collapse could be blistering given todayâs technology tools paired with our extreme social interconnectedness.”
https://bigthink.com/the-present/society-panic-attack/
“India’s decision to ban the export of non-basmati rice has led to consumers panic-buying and stockpiling Indian rice around the world, driving up prices in the process.
“In Canada, the U.S. and abroad, reports of panic-buying are flourishing on social media, with stores that cater to South Asian communities implementing caps on the amount that any customer can buy, and adjusting prices.”
https://www.cbc.ca/news/business/india-rice-ban-1.6916915
“Indiaâs Food Security Is Being Choked by Climate Change.
“The worldâs most populous nation is more poorly endowed with farmland, per capita, than Greece or Algeria. Thatâs going to make life harder as a warming planet destabilizes the cycles of rain and sun that have kept it fed for millennia.”
“What new norm of slower Chinese growth could mean for the global economy…
“The most immediate spillover of a Chinese slowdown will likely come in commodities and the industrial cycle, said Rory Green, chief China economist at TS Lombard. Beyond the immediate loss of demand for commodities, Green said Chinaâs recalibration of its key sectors drivers will also have âsecond order impactsâ for the global economy.”
“Peak Shipping Season Is Fizzling Out for Freight Companies.
“Freight operators are bracing for a weak peak shipping season this fall… “Thereâs no peak season to be expected in 2023,” said Stefan Paul, chief executive of Switzerland-based Kuehne + Nagel International, the worldâs largest freight forwarder by revenue.”
https://www.wsj.com/articles/peak-shipping-season-is-fizzling-out-for-freight-companies-900ab2f6
“US box shipments remain historically weak in Q2…
“Why does this matter? Box demand is a reliable leading economic indicator, specifically for the goods economy; both the goods economy (as reflected in truck and rail volumes) and box demand have been profoundly weak for over a year, with no indication of improvement ahead.”
https://finance.yahoo.com/news/us-box-shipments-remain-historically-224820603.html
“Gas prices just saw their biggest one-day increase in a year… The monthslong calm in gas prices is over…
“Cooling inflation, driven in part by easing gas prices, has raised hopes that the United States can avoid a recession… A return of higher food and fuel prices could unravel those positive trends.”
https://edition.cnn.com/2023/07/25/business/gas-prices-going-up/index.html
“How Phoenix’s Heatwave Is Challenging Energy Systems.
“…a recent study predicted that rolling blackouts in Phoenix could lead to 12,000 deaths and nearly 800,000 people being treated for heat-related illnesses. Thus, it is also really important for those who live here to know what to do if that rare blackout does impact us during a heatwave.”
https://oilprice.com/Energy/Energy-General/How-Phoenixs-Heatwave-Is-Challenging-Energy-Systems.html
“Why the Texas Power Grid Is Facing Another Crisis.
“The electric power grid in Texas, which collapsed dramatically in a 2021 winter storm, is being tested again as the state suffers unusually hot summer weather. Demand for electricity has reached new records at a time of rapid change in the mix of power sources as wind and solar ramp up.”
“UK interest rates need to stay higher for longer to beat inflation, says IMF.
“The IMFâs regular update on the state of the global economy singled out the US Federal Reserve and the Bank of England as two central banks that will need to raise official borrowing costs more aggressively than it assumed only three months ago.”
https://www.theguardian.com/business/2023/jul/25/uk-interest-rates-inflation-imf-us-fed
“Effects of interest rate hikes pushing UK economy towards ‘recession’.
“The authors of a closely-watched report on economic activity have warned of a growing threat of recession, citing twin pressures from inflation and interest rate hikes designed to choke the pace of price rises.”
https://news.sky.com/story/effects-of-interest-rate-hikes-pushing-economy-towards-recession-12926580
“Bank of England set to incur ÂŁ150bn loss from bond sales after interest rate rises.
“Higher interest rates will force the Bank of England to make a loss of ÂŁ150bn from the sale of bonds bought to shore up the UKâs financial system over the last 14 years â an increase from a ÂŁ100bn deficit projected in April.”
“ECB under pressure to signal end of interest rate rises after fall in loan demand.
“Eurozone banks have reported a sharp fall in demand for business loans to its lowest level on record, bolstering calls for the European Central Bank to abandon hints of further interest rate rises after its meeting this week.”
https://www.ft.com/content/8b5d4b4b-a940-4dbd-87e3-d6f12b88aba0
“Macron says France needs return to authority âat every levelâ after unrest.
“The French president used his first TV interview since the unrest to condemn what he called the âindescribable violenceâ of the clashes on the streets, including âthe burning of schools, city halls, gyms and librariesâ and âthe violence of lootingâ… He said: âThe lesson I draw from this is: order, order, order.â”
“Germany’s plan for credit guarantees violates climate commitments – environmentalists.
“Environmental groups on Tuesday criticized Germany’s draft policy on export credit guarantees as too vague and soft on financing for natural gas projects, as Berlin attempts a balancing act between climate protection and energy security.”
“General election results in Spain leave future of next government up in the air.
“The right-wing bloc which was expected to win, only secured 169 seats. The left-wing bloc won 153 seats – both falling far from an absolute majority. Sunday’s general election results in Spain have created uncertainty around the future of the next government – raising the spectre of political deadlock.”
“Italy harms itself by blocking changes to crisis-fighting in eurozone.
“Flexibility to mobilise the European Stability Mechanismâs resources is essential to maintain confidence, in case larger banks are in trouble. But one big obstacle stands in the way of the ESMâs role of supporting the euro areaâs banks in times of crisis. This obstacle is called Italy.”
https://www.ft.com/content/20170209-5ade-4ffe-a75c-09e4b2e168a1
“Italian officials held crisis talks today on how to manage blackouts in Sicily as hundreds of thousands are without electricity or water during a scorching heatwave.
“A temperatures soared to 47.6C, civil protection minister Nello Musumeci was forced to admit that the city of Catania had been ‘brought to its knees’ by power cuts.”
“Power cuts in Malta put the government in hot water…
“State-owned power company Enemalta said near record temperatures of between 40 and 42.7 Celsius (104-109°F) had caused electricity demand to spike and …underground distribution cables were overheating and failing… Business organisations said hours-long outages had caused supermarkets and restaurants to throw away food stock worth thousands of euros as fridges defrosted.”
https://www.reuters.com/world/europe/power-cuts-malta-put-government-hot-water-2023-07-25/
“Egypt: Citizens struggle with soaring temperatures amid ongoing energy crisis.
“With power cuts lasting around six hours in some areas, many are finding it difficult to stay cool and go to work, with concerns also being raised about the wider impact this could have on the country’s economy if the situation continues. The severe power outages started last month, with the government cutting electricity from street lamps as well as other services.”
https://www.middleeasteye.net/news/egypt-power-crisis-soaring-temperatures-energy-summer
“As West fears Tunisia collapse, hopes of IMF bailout fade.
“Western nations fear an economic collapse in Tunisia could trigger even greater migrant flows to Europe and have offered financial assistance. Yet prospects of Tunisiaâs sealing the biggest deal of all â a $1.9-billion bailout from the International Monetary Fund â seem increasingly remote.”
“Sudan is heading towards complete state collapse…
“No government service, from rubbish collection to medical aid, is available in the city [Khartoum] and surrounding areas. There are no traffic controls or functioning courts. Essential documents, like birth or death certificates and passports, cannot be obtained. Most civil servants, educators, doctors and other essential workers have left…”
https://www.aljazeera.com/opinions/2023/7/24/sudan-is-heading-towards-complete-state-collapse
“Burundi Economy About to Collapse.
“According to an independent media outlet Iwacu, Burundi people are constantly facing unprecedented rise in costs and shortages of; fuel, sugar, cement, medicines. Some city dwellers, especially those living in areas not far from the city center such as Musaga, Bwiza, Nyakabiga, Buyenzi, no longer even think of taking the bus.”
https://taarifa.rw/burundi-economy-about-to-collapse/
“Ecuador declares state of emergency amid violent clashes.
“Ecuador’s President Guillermo Lasso on Monday declared a state of emergency and night curfews in three coastal provinces, amid a wave of violence over the weekend in the Andean country that left at least eight people dead.”
“Offshore oil plans in Brazil threaten South Americaâs largest coral reef…
“Business leaders and local government officials in Brazil are relishing the opportunity to extract up to 30 billion barrels of oil from offshore deposits off the northeastern state of MaranhĂŁo. But the location is also home to the largest coral reef formation in South America, the Parcel de Manuel LuĂs.”
“IMF sees drought causing Argentina contraction of 2.5% in 2023.
“The International Monetary Fund said on Tuesday it is now projecting Argentina’s economy will contract 2.5% in 2023, with a year-end inflation rate of about 120%, largely due to a crippling drought that has curtailed agricultural production.”
You can read the previous âEconomicâ thread here. I’ll be back tomorrow with a âClimateâ thread.
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Hello Pan, thank you for your accumulation of disasters in all sorts of areas. Sicily and Italy do spqnnen the crown in the EU right now.
Have you ever heard of the an astute scholar of the global energy system, Dr. Louis Arnoux? He has a very interesting perspective on the fossil energy system. He and his team of engineers and scientists at the Fourth Transition Initiative focus more on the usable energy that oil provides to civilization (rather than counting barrels), and see the global energy supply and use system (GESUS as they call it) as one interconnected mechanism with feedback loops and its own complex behavior.
They address the distillation process of oil and divide “oil” into energy carriers on the one hand and raw materials on the other. Energy carriers are then formed by the means distillates especially diesel! and consider ‘ the rest’ as raw materials to be extracted.
This provides an extremely interesting and relevant scope on the limits of the fossil era and its collapse. (fourth transition inntiative) I find their approach more interesting and insightful than Tverberg’s mantras who only talks about the ‘cost’.
Since I have understood that the 28 cows on my farmer’s tiny farm opposite consumes over 200 liters per cow per year, I have been an enthusiastic fan of the diesel issue đ
I recommend you take a moment to read the link below…. you won’t regret it. Better than the Tveberg chewing gum đ
https://mail.google.com/mail/u/0/#inbox/FMfcgzGtwMZzqzWfzCVxfHgqgTNZwvrV
Zip, that link doesn’t seem to be working for me but I’ve had a quick Google. I do recall his name. It looks like he was on board with BW Hill’s thermodynamic analysis and was anticipating a pretty rapid break down of fossil fuel production, potentially by 2026. This is from 2016 (his thinking may well have evolved since then but I can’t find much in the way of recent output):
“For purely thermodynamic reasons net energy delivered to the globalised industrial world (GIW) per barrel by the oil industry (OI) is rapidly trending to zero. By net energy we mean here what the OI delivers to the GIW, essentially in the form of transport fuels, after the energy used by the OI for exploration, production, transport, refining and end products delivery have been deducted.
“However, things break down well before reaching âground zeroâ; i.e. within 10 years the OI as we know it will have disintegrated. Actually, a number of analysts from entities like Deloitte or Chatham House, reading financial tealeaves, are progressively reaching the same kind of conclusions.
“The Oil Age is finishing now, not in a slow, smooth, long slide down from âPeak Oilâ, but in a rapid fizzling out of net energy. This is now combining with things like climate change and the global debt issues to generate what I call a âPerfect Stormâ big enough to bring the GIW to its knees.”
https://www.resilience.org/stories/2016-08-02/some-reflections-on-the-twilight-of-the-oil-age-part-1/
https://thehonestsorcerer.medium.com/collapse-too-might-come-sooner-than-expected-eb3f16e8542d
Seems that it’s getting harder for you to keep the environmental half from sneaking into the economic side but they become more intertwined with each other with each passing hotter day. Keep up the fantastic work you’re doing, the Truth must get out now if we are to have any chance of surving climate disruption.
Thank you for the kind words, Sissyfuss.
It is getting harder to differentiate the two, I may be at fault here, being TZI (Time-Zone-Impaired). Being “ahead” of Europe and US, I get onto these posts at different times to others here, and hence never quite comfortable with which “thread” I might want to comment on – and more recently it seems to be getting more intertwined each cycle – as you say Sissyfuss, with each hotter day as the northern hemisphere summer unfolds.
Although I see most of the UK, has escaped the worst this year, whereas it didn’t escape in 2022. I believe this year, that the northern wibbly-wobbly-thin stranded Jet Stream has dipped further south below the UK, instead of across it, giving the mainland British isles almost a “normal” summer. So Far!
But – Speaking of 2024-2026 as one possible end-date, which I have seen bandied about for several years, but mostly with the hardest-core *climate-sollapse* doomers which I don’t often follow – I had a vague memory of past news and articles about the 2008 GFC – and so went on a google dip.
I found this one of projecting global Depression by 2024-26, written in 2012 – long before CoViD & back-when all Global Warming news was always stating the drama being closer to the “end of the century” anyway —
Once I saw it, I distinctly remember reading it before, (or something very like it) in around 2012 etc, and thinking
meh, bleh…. oh well, thats a long way, way, away.. nobody can predict economics that far in advance….
Ha! And here we are over a decade later, so much closer to this particular prediction –
and it gave me shivers….
Thanks again Pan, for putting the two threads so closely together. The intertwining of economics with the climate, may well still prove to be a double-thread braided/tied ‘shock’ coming together.
https://www.progress.org/articles/the-depression-of-2026
I’m just waiting to see how weather weirding is going to affect areas that depend on tourism.
We don’t have any economic problems. Any old bank can create $10,000 out of thin air from a $1000 deposit. Just think how much Central Banks can create. Fictional reserve lending is our panacea.
Capitalism! My big ol’ butt. “A suckers born every minute.” & they believe anything they are told. Everyone is going to learn how to do with less? Down sizing will be a hard pill to swallow for many.
Perhaps everyone here has already heard about the large ship that is burning off the coast of the Netherlands. It was loaded with almost 3000 cars. It is said that the fire started when an electric auto caught fire. It has been widely known for some time that when an electric car catches fire it is much harder for firefighters to put the fire out than when a conventional auto catches fire. So we should not be surprised that a fire started by an electric car is causing a large ship to sink.
I wonder if anyone will take this incident as a clue that electric cars should not be shipped around the world but should instead be built relatively close to the market that they will be sold in.
Curt, thank you – that will feature in today’s round-up.