@Doly
I have version 7, but i think chapter 6 and diagram 6.2 are the same.
The switch from energy to money and vice versa is an important point. Most people know, that the economy runs on energy, but always speak of the influence of money on the economy, and never mention the energy.
1. Money gets printed by central banks, and is created out of thin air. In theory, infinite amouts of money are available.
2. In contrast, energy is finite. Energy is used to produce energy.
This simple point has the following consequence: As long as a person believes, money explains the economy, they don’t understand the problem with energy:
To 1. If the money required to produce energy gets too high, some more money is to be printed by the central banks, and the problem vanishes.
To 2. In contrast, if the energy required to produce energy gets too high, a crash in the production system will occur.
You might think, this can’t be a problem, but it is. Most economic theories don’t ever mention energy. Only about 1995 Ayres and Kümmel started to include energy in economic theories, but this knowledge has not reached the public. ALL economists (i repeat: ALL) with which i talked were not able to think in energy terms instead of money terms. For them Peak Oil must be a problem of geology:
To 1: All oil available will be extracted, because some of the infinite money for extraction will be available.
But the reality is:
To 2: Oil extraction will experience a crash, when the extraction energy surpasses a limit. (Think of the critical point of diagram 6.2).
If you want to get an idea, what money really is, read David Graebers book „Debt: The first 5000 years.“
I myself use the energy intensity diagram, which is „world GDP“ divided by „world primary energy use“ for switching between money and energy. Money is not the same as energy, but the diagram is useful.
