Pigs are flying

October 29th, 2012 atam Posted in Climate change, General, Peak oil | No Comments »

There’s a recession looming, but you wouldn’t know it from looking at the newspaper.

Every other page is an advertisement for London property and “wealth management” or private banking services as well as opinion pieces by fund managers and property analysts introducing funds with amazing returns.

For every report on poverty and inflation, there will be more about Hong Kong becoming quite an art hub with auctions and fairs. People are even expecting a pay rise.

Somehow, there is so much money sloshing around looking to grow into ever-bigger pots that big banks and big companies can’t kick the small fries out quickly enough to refurbish yet more premises into swanky branches that only the seriously moneyed may enter without being scorned.

The economy is booming and tanking at the same time. On one hand companies are worried about the global economic outlook, retailers have seen their takings decrease as even mainlanders tighten their purse strings, and workers fret over their jobs. On the other, the stock market is reaching highs and investors are sailing in, putting pressure on the Hong Kong dollar.

Do you actually believe that the EU will come out of its current malaise anytime soon? Or that the recovery in the US will pick up much speed? Or that local governments in China don’t have a debt problem that will catch up with the country someday?

Every time there’s the slightest sign that the world economy is growing again, as the IMF so fervently wishes, oil prices go up in tandem. That’s not the worst of it. An authoritative report by the US National Research Council has just been released, pointing out that biofuels production from algae is unsustainable in terms of use of energy, water and nutrients. The positive spin is that industry could improve its techniques to reduce the inputs needed throughout the production cycle, but will the improvement come in time to replace all the oil needed?

In the meantime, a sociologist at the University of Oregon noted something that nobody seems to have paid much attention to. Richard York found that CO2 emissions doesn’t fall during economic downturns at the same rate it rises during booms, meaning we can’t even take comfort in the hope that a recession would slow down global warming.

But it hardly matters.

There’s a virtual economy involving huge sums appearing and disappearing across computer screens; and there’s a real economy where people are getting less and less for what money they’ve got. Those in possession of the numbers on the screens will continue to party till the sun goes down. Those who just discover that a few sticks of celery have tripled in price will just have to find their way to the food bank – if a food bank is to be found.


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