[MrBill]

$this->bbcode_second_pass_quote('Doly', 'W')TF does "the global economy has peaked" mean?

I understand that oil production can peak, but what kind of economic measurement is peaking when they say something like that?

[Kez]

$this->bbcode_second_pass_quote('rogerhb', '3'). People work with the system because they believe one of the following:

i. they have no option
ii. they are working towards a better tomorrow.

So how can all have a better tomorrow, be more wealthy, if we live on a finite planet? Or is the goal to delude enough of the people so that they don't revolt?

[falser]

The article is dead on. Liquidity contraction is indeed probably the biggest problem facing the US economy, it cannot go on forever. Once the easy money (free debt) disappears there will inevitably be some hard times for anybody that owes money, or lends money. Banks won't have increasing cashflow, average income people won't be able to afford million dollar homes, no more big screen TV's, no more 0% financed SUV's.

[MrBill]

$this->bbcode_second_pass_quote('falser', 'T')he article is dead on. Liquidity contraction is indeed probably the biggest problem facing the US economy, it cannot go on forever. Once the easy money (free debt) disappears there will inevitably be some hard times for anybody that owes money, or lends money. Banks won't have increasing cashflow, average income people won't be able to afford million dollar homes, no more big screen TV's, no more 0% financed SUV's.

[threadbear]

$this->bbcode_second_pass_quote('Kez', '')$this->bbcode_second_pass_quote('rogerhb', '3'). People work with the system because they believe one of the following:

i. they have no option
ii. they are working towards a better tomorrow.

So how can all have a better tomorrow, be more wealthy, if we live on a finite planet? Or is the goal to delude enough of the people so that they don't revolt?

[cheRand]

Or maybe people mostly learn about the world around them from the cues that they get from other people and from TV. T

hey try to do their best at meeting their needs, but failures such as personal debt are pretty much isolated to a handful in their realm of intake at a time, mostly.

When others around them are successful, they have encouragement to plug along. But when a lot of people in close proximity are dissatisfied at the same time, it creates "hot spots" of dissatisfaction that can spread to other people also at the tipping point.

There are some patterns like this in other things: Viral marketing on the internet; disease epidemics; street riots; fads; political transformation.

But regardless of human character and motivation... (back to topic)...

The research coming out of the Institute for Strategic Competitiveness at Harvard Business School is encouraging local regions to find clusters of industry that are interrelated and share a competitive advantage based on location. They don't talk about peak oil, but do talk about availability of the "pieces" needed within an industry. So I'm guessing that smart corporations will begin to marshal in the components of their processes into regional areas. Another group, IMPLAN, says labor is usually the decisive cost factor in production. Course, that's way overgeneralized. But the point is:
1. Find your biggest cost. Find the place you can meet it cheapeast.
2. Surround yourself with the infrastructure to do it all in that area.
3. Create a regional powerhouse.

I'm reminded of the ordering of peasant society in Mexico, where ie, the musical instruments are from informal artisans in Michoacan, the pottery from Oaxaca, the fiber arts from Chiapas... and they all went to market in Market centers. Only today, market centers are not needed. These are just distribution functions. I think prices will reflect transkportation from the complex production center.... and that small local companies will get in under the transportation cost niche.

[threadbear]

Cherand, Interesting post. I'm looking forward to hearing from you more often.

[SHiFTY]

$this->bbcode_second_pass_quote('', 'G')erard Lyons, chief economist at Standard Chartered, said the global economic cycle had peaked, pointing to rising interest rates, the potential for slower growth in the US and China and the fact that the Japanese and eurozone economies were not in a position to take up the slack.

"The next six months will be a challenging time, dealing with the high oil price, and global imbalances loom. The global economy has peaked and liquidity conditions are set to tighten. When things turn around you can have significant fallout."

[Barbara]

From a journalist point of view, it looks very funny how they used the word "peak" (economy).
I'd expect it from a peakoiler, seeing peaks here and there, but how this word came to mind of those flat earth economists?
I bet there's a lot of "peak" talks behind the FT curtain... they are getting used to the word without using it in their oil articles.

[khebab]

$this->bbcode_second_pass_quote('MrBill', '')$this->bbcode_second_pass_quote('falser', 'T')he article is dead on. Liquidity contraction is indeed probably the biggest problem facing the US economy, it cannot go on forever. Once the easy money (free debt) disappears there will inevitably be some hard times for anybody that owes money, or lends money. Banks won't have increasing cashflow, average income people won't be able to afford million dollar homes, no more big screen TV's, no more 0% financed SUV's.

[GoIllini]

$this->bbcode_second_pass_quote('SHiFTY', '')$this->bbcode_second_pass_quote('', 'G')erard Lyons, chief economist at Standard Chartered, said the global economic cycle had peaked, pointing to rising interest rates, the potential for slower growth in the US and China and the fact that the Japanese and eurozone economies were not in a position to take up the slack.

"The next six months will be a challenging time, dealing with the high oil price, and global imbalances loom. The global economy has peaked and liquidity conditions are set to tighten. When things turn around you can have significant fallout."

[lowem]

$this->bbcode_second_pass_quote('GoIllini', 'W')e'll just print more money and restart our economy. Hundreds of nations have done it.

[GoIllini]

$this->bbcode_second_pass_quote('lowem', '')$this->bbcode_second_pass_quote('GoIllini', 'W')e'll just print more money and restart our economy. Hundreds of nations have done it.

[MrBill]

$this->bbcode_second_pass_quote('', 'T')he interesting thing about recession is that governments can usually borrow and spend to stimulate the economy. However the US has been maxed out on its credit card for some years now; and is unlikely to be able to finance any stimulatory expenditure.

[MrBill]

$this->bbcode_second_pass_quote('', 'E')xactly. Hyperinflation really isn't all that bad, long-term. If Hitler had died in 1938, Germany would have come out of its recession in better shape than it could have ever hoped it would in 1920.

When an educated, industrialized country with plenty of natural resources experiences hyper-inflation, it can make out well.

[GoIllini]

$this->bbcode_second_pass_quote('MrBill', 'T')his is wrong from a historical perspective and an economic one, but I just don't know where to start? I guess everyone is entitled to their opinion?

But, as someone else said, Argentina is not richer for their hyperinflation and numerous debt defaults. Zimbabwe is not richer for its mishandling of the economy. Inflation leads to inflation not prosperity.

[linlithgowoil]

$this->bbcode_second_pass_quote('', 'I') always maintain that WWII started with the signing of the Treaty of Versailles.

[MrBill]

$this->bbcode_second_pass_quote('', 'C')ome on man, so do most respected historians! I'm pretty sure it wasn't you that came up with that point. Sorry if I'm offending you here!

[Vexed]

From the FT article
$this->bbcode_second_pass_quote('', '.')..and liquidity conditions are set to tighten.

[MrBill]

$this->bbcode_second_pass_quote('Vexed', 'F')rom the FT article
$this->bbcode_second_pass_quote('', '.')..and liquidity conditions are set to tighten.