By Eivind Berge. Original article here.
So, are we there yet? Considering the ongoing price crash with regard to oil and other commodities, I think there is a strong possibility that this is it. Again, I have to credit Gail Tverberg with explaining how increased depletion leads to falling oil prices, or else I would be just as clueless as most people. She is kind of verbose, however, and uses lots of graphs and supporting data which is all very important, but not really needed to grasp what is going on intuitively. So maybe my putting it into few words can help more people understand. She thinks we have at most two years of business as usual left, and then collapse will occur by the end of 2016. And the only remedy she can come up with is to pray for divine intervention.
If you understand how this works, you will quit worrying about comparatively distant issues such as climate change and realize that falling commodity prices is the most ominous problem of our times. Of course, the problem may well morph into something else before it becomes obvious that there is a resource crisis, such as another World War or a crippling financial crisis. But even if we avoid any other major disturbances, deflation will kill us rather soon. After oil prices go too low to encourage further exploration and drilling, for example, the depletion rate of existing oil wells will be at best about 6% per year. So imagine the economy shrinking by 6% as a best-case scenario. Our financial system is not arranged to handle orderly degrowth, however, so most likely there will be a much more rapid collapse instead, in one way or another.
Ps! Tverberg is like Miss. Marple, investigating our energy and resource scarce future. She looks like Miss. Marple, speaks like her and is extremely intelligent. And as she's a woman she can better be trusted than a man, lacking male ego and imagined infallibility.