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Archive for Março, 2020

Harvard to the Big House

(This article contains spoilers to The Expanse, which is where all the quotes below are from.)

protmolecule

Get COVID-19’S real story here.

“You can tell you’ve found a really interesting question when no one wants you to answer it.”  

Over the past several months thousands of humans have lost their lives since COVID-19 kicked-off its killing spree in Wuhan, and barring an absolute miracle millions more all across the planet will join them in the months to come. Comparisons to the pandemic caused by the Spanish Flu earlier in the twentieth century abound, however one thing is clear: Whether due to globalization or to internal differences between the viruses, while the Spanish Flu was a slow-moving miasma that took years to unfurl across the globe, the Wuhan strain of coronavirus, COVID-19, has blanketed the entire planet in just a few months.

Factories all across the planet have ground to a halt, stores are shuttered, tens of millions are quarantined across multiple continents, and supply chains are disintegrating.

And oddly, even though there is nothing even beginning to approach conclusive evidence that COVID-19 was a naturally emergent strain that made its way out of an intermediate animal host and into humans, the general consensus in the media and the public seems to be that exploring its origins is something only done by people who’ve yet to buy that the Earth is in fact round and that we actually did land on the moon. And everyone seems to be okay with the fact that the scientists crowing the loudest about a natural origin, are the ones directly involved with the type of research that likely spawned this virus: Gain-of-function, or “dual-use” research that meant to push Nature past her limits, so that humans can harness her to create monsters that would never occur naturally.

Why the concentrated push to marginalize anyone asking for conclusive proof about where COVID-19 came from? Who benefits?

“We modified our science team to remove ethical restraints.”

Back in 1977 a very peculiar disease began to sweep across Russia, and once scientists had isolated it they discovered it was a rather unique strain of the H1N1 Swine Flu. In the years that followed genetic analysis looking to determine where it might’ve come from found something rather odd: It was very similar to strains of H1N1 that hadn’t been in circulation for decades, and seemed to be the product of “sequential passage in an animal reservoir” which was determined by its vast genetic distance from any other present strain of flu, just like COVID-19 which also appears so distant from any related coronavirus that it’s been placed in its own clade, an isolated branch way out on its own in the viral family tree – meaning it’s the lone example of its kind, and doesn’t clump together with all the other known coronaviruses.

At the time, the Soviet Union was employing tens of thousands of scientists designing every possible flavor of biological weapon, a rabidly immoral weapons program with a spotty safety record – pathogens were known to leak out of Soviet labs almost regularly. Which has happened at plenty of biological weapons labs since, but especially China’s, which have leaked the SARS virus four times just in recent years. And Soviet scientists were reported to bring dead research animals home for dinner, meat wasn’t exactly readily available in the USSR at that time, which parallels the reports of scientists in Wuhan smuggling dead lab animals out to sell for a few extra bucks on the street.

Earlier in the 70’s prior to the leak, “the swine flu scare… [had] prompted the international community to reexamine their stocks of the latest previously circulating H1N1 strains to attempt to develop a vaccine,” which was seen to have increased the odds that someone, somewhere would make a mistake and leak an altered strain of the flu out of their lab. This increased pace of research mirrors recent times, when scientists have been investigating and trying to understand the supposedly impending threat posed by coronaviruses for years, capturing as many unique strains from the wild as they could, and mixing and matching their genomes in the lab.

And so increased research into the H1N1 Swine Flu back in the 70’s eventually increased the odds that a mistake would happen enough that one did, and a leak occurred. Just as our current pandemic was preceded not only by years of research into coronaviruses everywhere from UNC to the Wuhan Institute of Virology’s Disease Engineering Technical Research Center, and most recently by a massive international conference meant to study a pandemic caused by a coronavirus, Johns Hopkins’ Event 201. Which was meant to model a global pandemic caused by a hyper-virulent strain of coronavirus, and was funded primarily by the World Economic Forum as well as the Bill and Melinda Gates Foundation, and notably occurred in October 2019, just weeks before the start of this outbreak of COVID-19.

If leading up to 1977, the fact that increased research into strains of the flu were seen to increase the odds that an accidental leak would occur, why isn’t the same logic being applied to our pandemic today? Why is almost everyone today assuming that the increased pace of research means scientists in fact anticipated this outbreak instead of causing it?

Wouldn’t an increased pace of research also increase the odds that a leak of a lab-modified coronavirus would occur just like an increased pace of research precipitated the leak of the H1N1 Swine Flu back then?

“You give a monkey a stick, inevitably he’ll beat another monkey to death with it”

Scientists have been directly altering and modifying viral genomes for at least the past twenty years, doing everything from building complete viruses from scratch, to tweaking them and then passing them through series of animal hosts to artificially speed selection and evolution along so that they’re able have as many different strains of virus with as many novel features as possible to tinker with.

However most of this work didn’t really raise too many eyebrows, until about ten years ago when scientists in Stony Brook, NY – not coincidentally also the first place to build a DNA-virus from scratch – took the H5N1 Bird Flu, tweaked its genome in two places, and then passed it through a series of ferret hosts in the lab until it became airborne. This sort of research, a minor alteration and then passage through ferrets, did two things: Resulted in a virus that would look natural and wouldn’t appear to have been directly genetically altered, and also created a virus that was way out on its own branch of the viral family tree since those sequential passages added generations far faster than they’d naturally occur in the wild. If that sounds familiar, maybe that’s because those traits are also exactly what’s found with COVID-19. And as far back as 2015, Chinese labs were reported to have been involved with gain-of-function research, swapping around viral genomes in the lab to try to create the most virulent strain possible.

Quite curiously, one of the scientists supporting this troubling research in an article that noted the virus “could change history if it was ever set free” appeared on Joe Rogan’s podcast in 2020 a few weeks into the current pandemic, claiming that COVID-19 was definitely natural and making no mention of this ferret-based dual-use gain-of-function research at all. Odd, right? It’s almost like Michael Osterholm, whose entire career rests on advancing gain-of-function of research, might want to whitewash what’s really going on? Did that sunshine tickle when it was being blown up your ass, Joe?

Osterholm failed to tell the story of this genetically modified H5N1 Bird Flu, which was turned into a virus that “could make the deadly 1918 pandemic look like a pesky cold.” This result was so troubling that the NIH, which had funded the research, tried to make sure that the it would only be published after enough details were taken out to make replication of the experiment tough to perform. However one of the virologists involved in the research thought these restrictions were a bit silly, since the gist of the experiment was enough to allow anyone with enough money to replicate them without a problem. Especially researchers who were already familiar with manipulating bat coronaviruses, two of whom learned how to do exactly that at UNC in 2015 before returning to Wuhan to continue their work.

A few years later the NIH would ban this dual-use “gain-of-function” research, a ban that would remain in place from 2014 until 2017, when it was lifted. And what was the reasoning behind lifting the ban? To allow for research on flu viruses, as well as SARS and MERS – coronaviruses just like our new friend, COVID-19. And so hundreds of millions of dollars of funding poured into research on these viruses, supposedly with oversight meant to reduce “the potential to create, transfer, or use an enhanced potential pandemic pathogen.”

Turns out, that oversight might not have worked out too well, witnessed by the thousands who have already died from COVID-19.

“But it is only a machine. It doesn’t think. It follows instructions. If we learn how to alter that programming, then we become the architects of that change.”

And so since 2017 the floodgates have been opened, and money has poured in to fund gain-of-function research on coronaviruses, and they’ve been seen as everything as as potential base to create an HIV-vaccine from, to being able to help scientists in their mission to create a universal vaccine against the flu and common cold. Unsurprisingly, the Bill and Melinda Gates Foundation, which helped bankroll Event 201, has also poured millions and millions of dollars into the search for a vaccine against HIV, much of which is centered around harnessing coronaviruses.

Pointing out the funding from their foundation isn’t meant to demonize the Gates family, only to begin to build the idea that accountability does’t lie with the scientists in Wuhan alone, or the Chinese Communist Party for trying to cover-up the beginning of the pandemic. Why the NIH allowed this really obvious Pandora’s Box to be reopened in the first place deserves to be answered, and the organizations funding this research should carry much of the blame as well.

Bill Gates might want to be an effective philanthropist really bad, and he may have been amazing at designing computer software and undercutting his competition – however that doesn’t a philanthropist make. After all, his very well-intentioned attempt to save lives by providing  insecticidal mosquito-nets was ultimately destructive: many of the villagers provided with the mosquito-nets decided they were better used as fishing-nets, resulting in food shortages due to over-fishing from the fact the nets smaller weave caught far too many juvenile fish, undercutting population growth.

Seemed like a good idea at the time, right?

“Distributed responsibility is the problem. One person gives the order, another carries it out. One can say they didn’t pull the trigger, the other that they were just doing what they were told, and everyone lets themselves off the hook.”

Far more sinister than the Gates Foundation funding gain-of-function research is the involvement of scientists hoping exclusively to bankroll their own companies through this kind of work.

While The Expanse had Jules-Pierre Mao, a scientist-CEO who used his private company to hybridize the protomolecule – a mysterious apparently alien substance that seems to have a mind of its own – with humans to create unstoppable biological weapons, today we have Peter Daszak.  His company, EcoHealth Alliance, which is a non-profit that depends largely on multi-million dollar government grants to function, has been partnering with Chinese researcher for years in an attempt to secure funding for more and more research into coronaviruses. At least they’re not really even pretending to be philanthropic.

And in one of the more transparent attempts at blatant PR-spin, Daszak was featured alongside one of the researchers who learned how to create hyper-virulent bat coronaviruses at UNC back in 2015, Zhengli Shi. Their article insists we should take Zhengli at her word when she claims to have not found a match after she checked COVID-19’s genome against everything in her lab. As if someone responsible for releasing the most virulent pathogen to hit humanity in modern history, one that’s already killed thousands and is projected to kill millions and millions more all across the globe, would simply fess-up to it, torpedoing her career and the years of research performed by her and her colleagues? And possibly opening all of them up to legal and other repercussions?

If you still aren’t sure whether the scientists involved with kind of research are being forthright, there’s Dr. Ralph Baric. It was in his lab at UNC that a hyper-virulent bat Franken-virus was created by splicing a new protein-spike on an existing coronavirus, creating a monster so vicious that a virologist with the Louis Pasteur Institute of Paris warned: “If the [new] virus escaped, nobody could predict the trajectory.” 

So if he was being honest, you might expect him to warn the public about the lethal potential coronaviruses pose during our current outbreak. However, when he was asked if the public should be worried about COVID-19 he said that people should be more worried about the seasonal flu. Pretty bizarre statement from a scientist who knew full well how dangerous coronaviruses could be, especially given the fact that not only was Zhengli Shi working in his lab on that project in 2015, but Xing-Yi Ge was too. Both of whom returned to Wuhan where they’ve continued their work for years.

Xing-Yi Ge is especially notable since in 2013 he became the very first scientist to isolate a bat coronavirus from nature that uses the ACE2 receptor, which is found in human and ferret lungs and allows coronaviruses to become airborne. And as you might have learned by now, that’s the exact receptor used by COVID-19 to enter human cells – if anyone would know how to finagle that part of the coronavirus genome, it’d be him. So both Xing-Yi Ge and Zhengli Shi were part of the research team that created this hybridized hyper-virulent bat coronavirus under Baric, who’s actively downplayed the risk posed by COVID-19, and then returned to work in Wuhan, where funding provided in part by Daszak’s company allowed them to continue their work on coronaviruses with plenty of research to cut-and-paste into their work at the Wuhan Institute of Virology’s Disease Engineering Technical Research Center.

And as Dr. Ian Malcolm puts it in Jurassic Park, it is never a good idea to futz around with science and research when you don’t fully understand it, nor its possible implications.

However it wasn’t just Daszak funding their work, Zhengli also secured millions of dollars in grant money from various American institutions including our Department of Defense as well as the U.S. Biological Defense Research Directorate, and millions more from other foreign governments.

So although the Chinese Communist Party deserves its share of the blame for attempting to cover the outbreak up, arresting the heroic scientists trying to warn us and issuing gag-orders and the destruction of evidence, this research likely wouldn’t have occurred at all if the NIH hadn’t lifted the ban on gain-of-function research in the first place. And it was funded directly by American tax dollars, by government officials willing to let others play god at their behest.

But now that the virus is out of the lab, are the private entities responsible for its creation going to bear any of the blame at all? Or will America and China continue to point fingers at each other until the worst happens?

“Mars will accuse Earth of using a bio-weapon. Earth will claim it was Mars. The Belt will blame the other two. It’s a good way to start a war and cover it up.”

One last spoiler warning… okay, so in The Expanse the central plot device pushing things forward is the discovery of a mysterious substance dubbed the protomolecule, which seems to have a mind of its own and seek out radiation as sustenance before then beginning “the Work,” a mysterious intergalactic goal that isn’t revealed until later seasons.

(mais…)

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Liebig’s Law Writ Large

The Consciousness of Sheep

New deliveries of eggs to British supermarkets are being snapped up as quickly as the shelf stackers can get them onto the shelves.  At the same time, tons of eggs are going off in warehouses which currently hold massive stocks of food.  The unexpected reason for this situation, we learn from the BBC’s Farming Today programme on Wednesday, is that the UK is currently in the grip of an unanticipated egg carton shortage.  The entire of Europe is supplied by just three egg carton manufacturers.  None is based in Britain; and the nearest one – in Denmark – is closed for the next fortnight.  And so we have warehouses full of eggs and queues of shoppers asking for eggs, but no means of connecting the two.

The problem stems from something that has plagued the UK government from the very start of the SARS-CoV-2 pandemic – a combination of a weak state and blind faith in the power of the private sector to respond to crises.  When the original British pandemic plan (allowing the population to be infected in order to develop “herd immunity”) collapsed at the end of February (after models showed that it would result in critical infrastructure being overwhelmed) the UK government attempted to do in weeks what should have been done in months.  Responding to public pressure, government was led inexorably down the road to the current lock-down of all but essential activity; including the closure of all non-food retail, restaurants, hotels and schools.  That this was unplanned is born out in the current confusion about who is and who is not a “key worker,” with the result that public transport was jam packed with commuters on Monday morning despite government orders to stay at home.

Half of the food eaten in Britain in the years before the current SARS-CoV-2 World Tour was consumed outside the home.  In effect, we had two parallel food distribution chains – a wholesale chain for catering industries and a domestic chain for food sold directly to the public.  When the order was given to shut down the schools, restaurants and other wholesale consumers, there was no mechanism in place to divert food supplies from that chain into the domestic chain.  As a result, shortages which had already developed, as the public correctly anticipated the current lockdown, were exacerbated as the 50 percent who usually ate out took to the supermarkets in search of alternatives.  Meanwhile, wholesale food supplies are stuck in warehouses because the packaging used for bulk supply to caterers cannot be used by supermarkets.  An increase in supermarket packaging supplies would help… but, as Farming Today reported, the factory is closed for a fortnight.

A shortage of egg cartons is an example of Liebig’s Law of the Minimum, which holds that a complex system fails at its weakest point.  There are plenty of chickens laying plenty of eggs, there are plenty of trucks to deliver them and there is more than enough space on the shelves for them.  But the absence of those small cardboard containers is enough to bring the entire system to a halt.  Taken in isolation, this would be a problem hardly worth mentioning.  In normal circumstances, the private sector is indeed far better than a centralised state at rapidly responding.  But these are anything but normal circumstances.  As Tim Lang, professor of food policy at London’s City University explains in a BBC interview:

“’It is like a web of stretched rubber bands… ‘if one breaks then it knocks on through the system’.”

The danger for an economy which is currently in a supply and demand freefall worse than anything witnessed in 2008 or 1929 is that those tightly stretched elastic bands may begin snapping all over the place.  Whole industries which, prior to the pandemic, claimed to be indispensable currently lie idle – air travel and car manufacturing being the most obvious.  Some are being repurposed to meet shortages in respirators and protective equipment for frontline medical staff.  Now redundant transport fleets are also being diverted to food supply and other urgent supply chains.  Although, as the BBC article points out:

“…the Freight Transport Association is working hard to ensure that, in the face of a shortage of garage mechanics, trucks still get serviced as and when required.”

Once again, it turns out that while the highest-paid people in the UK can sit at home for three months without any noticeable impact on daily life, ordinary workers like truck drivers and garage mechanics are crucial to the life support of the entire civilisation.  But mechanics are only as good as the tools and the spare parts that they are equipped with.  And with most of the spare parts made in China or neighbouring Asian countries, and with most of the Northern hemisphere on lockdown, there is a huge risk of supply shock in the next few weeks.

Nor is public transport faring much better.  The initial problem for public transport operators was the severe fall in demand in February as passengers reasoned that trains and buses were incubation chambers for the SARS-CoV-2 virus.  While some took to working from home, others walked or dug that old bicycle out from the back of the shed.  The result was a collapse in demand which obliged operators to cut back the service.  The unfortunate consequence has been that despite the instruction to avoid social contact, the remaining trains and buses are overcrowded at rush hour.  The knock-on problem that this has now caused is that public transport staff are now going sick in large numbers.  As Tom Edwards at the BBC reports:

“Numerous transport workers, critical staff themselves, have direct messaged me via Twitter and they are furious:

“A TfL worker wrote: ‘It’s not just drivers who are sick or isolating. It’s station staff, signallers, admin, back office people, controllers, cleaners, all of us. Please let people know we’re not immune to this virus and we don’t want to be used in political point scoring!’…

“Another Tube driver told me: ‘We have 30 / 80 drivers off and half the managers. We are trying our best. We want to do more but we don’t decide the service levels. We don’t want to be driving packed trains of non-essential workers. [I’m] very upset we are being blamed when we’re putting our families at risk.’”

In a complex system, key workers are as critical as those cardboard egg cartons.  You cannot simply go to the local job centre and find an army of unemployed drivers, signallers and controllers – these are skilled roles which require months and years of training.  The same goes for the truck drivers who are currently keeping Britain’s critical infrastructure working.  There is a reason why they don’t let you drive a 40 ton articulated truck on an ordinary car licence – it would likely result in more deaths than Covid-19.

Second-order problems are also materialising in the health system, as an overloaded NHS is obliged to scale back on the run of the mill procedures and treatments which would ordinarily be taking place.  Now is not a good time to develop toothache because almost all dental care has been suspended for the duration (in Britain’s health system, toothache is not defined as an emergency).  At the other end of the scale, the lives of cancer patients are being put at risk as resources are diverted to managing the pandemic.  In between, the whole range of routine treatments, elective surgery and day clinics have been put on hold; raising the risk that key workers will be incapacitated for reasons other than Covid-19.

The response to the pandemic has brought out the best and the worst in us.  On the one hand, an army of people, many laid off from work but now being reimbursed by the state, has volunteered to help vulnerable people; particularly those instructed to remain in quarantine for at least three months.  On the other hand, the nation’s fuckwits continue to treat social distancing as optional.  Nor should we ignore the role of government – for being ambiguous about the definition of a “key worker” – and non-critical employers – for putting profits ahead of people and insisting on employees turning up for work.  For the most part, people want to do the right thing, but in an economy that is teetering on the edge of a cascading collapse, it is difficult to know what the right thing is.

What we have learned is that the entire system is highly vulnerable to relatively small – and probably impossible to predict – supply shocks.  An egg carton here and a garage mechanic there are all that stand between us and the collapse of the complex network of supply chains which keep us alive.  Whatever else comes out of the ruins left by the SARS-CoV-2 virus, a shift in the balance between efficiency and resilience will be inevitable.  Remember that SARS-CoV-2 is but one of the many zoonotic pathogens waiting on the fringes of global industrial agriculture to cross the species into humans.  And pandemics are but one of the threats facing us in the 2020s.  Energy constraints, resource shortages and the consequences of a changing climate are waiting in the wings to visit crises far worse than this pandemic on a now enfeebled global economy.  And as more and more people wake up to our lack of resilience, change will be unstoppable.

That will come at a huge cost, of course.  The reason that every generation since World War Two has enjoyed access to cheap food, cheap fuel and cheap goods is precisely because we – collectively – generated these fragile global just-in-time supply chains to drive down prices.  Making them more resilient will inevitably involve far more duplication and localisation (continental if not national) together with a greater degree of redundancy (such as return of warehouses and a surplus of key workers paid to be on standby).  Without some degree of redistribution from a corporate class that has grown fat on corporate welfare and currency manipulation to a broader population impoverished by banks and governments alike, the system will be unaffordable; and so some form of redistribution is inevitable (whether through taxation or inflation).  Critical infrastructure is likely to have to be socialised in future too – either run directly by the state or on a not-for-profit basis in the private sector.  But the corollary to this is that many of the things that we currently do are going to go away in the near future (air travel and driving being the most obvious).  Put simply, if it cannot be done locally it won’t be done at all.

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La Haine, So far so good

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SRSrocco Report

There’s more evidence finally surfacing in the media of the dire energy predicament the world is now facing.  The negative ramifications of peak oil and the falling EROI were going to hit the world economy within the next 2-5 years, but the global contagion has sped up the process considerably.  Unfortunately, the world will never return back to the energy consumption and GDP growth experienced in 2019.  I believe the peak of unconventional oil production has finally arrived… FOREVER.

Here are a few highlights describing the ongoing ENERGY DISASTER taking place

U.S. Bakken Oil Production Peaked Oct 2019 While Setting A New Record In Wastewater Production

According to Shaleprofile.com, the Bakken’s production peaked in October 2019 at 1,506,358 barrels per day (bd) and fell to 1,462,025 bd in December.  When the data comes out for Mar-Apr-May, I believe that Bakken’s oil production will begin to drop off considerably.

Furthermore, even without the global virus destroying oil demand, the Bakken was going to peak shortly due to a key indicator… a tremendous increase in the amount of wastewater.  Surging wastewater production is a bad sign signaling reservoir depletion.  Using the data from the North Dakota Department of Mineral Resources, the Bakken is now producing nearly 1.5 barrels of wastewater for each barrel of oil:

In January 2016, the Bakken was producing 115% more wastewater than oil, but that has surged to 149% during January 2020. While oil production increased by 8.2 million barrels (per month) since January 2016, wastewater surged by an additional 23.2 million barrels (per month).

The Death of the Bakken has finally arrived.  Due to the collapse in U.S. oil consumption, I see a huge decline in Bakken oil production over the next three quarters.

Oil Plunges After IEA Hints Russia, Saudis Would Need To Completely Halt Production To Balance The Market

This was an article on Zerohedge that stated the following:

This echoes what Goldman’s commodity analysts wrote overnight, warning that “global isolation measures are leading to an unprecedented collapse in oil demand which we now forecast will fall by 10.5 mb/d in March and by 18.7 mb/d in April” or nearly the 20mb/d forecast by the IEA. As Goldman sumamrizes, “a demand shock of this magnitude will overwhelm any supply response including any potential core-OPEC output freeze or cut.”

I believe the IEA’s forecast for a decline of 18.7 million barrels per day (mbd) in April will be grossly understated.  It will likely fall 25-30+ mbd by April. Interestingly, the IEA – International Energy Agency shows that global Jet fuel demand will fall about 2 mbd.  However, with U.S. commercial air traffic down 90%, Unprecedented Collapse: U.S. Airline Traffic Currently Just 10% Of Normal, I see global Jet fuel consumption down at least 4+ mbd in April, double the IEA’s figure.

Now, it seems as if the IEA believes Wall Street’s forecast that there will be a “V-Shaped Recovery,” (hence, the v-shaped oil chart) and everything will be back to normal by the end of the year.  I highly doubt it.  Also, I find it quite interesting that the IEA hints that the Saudi’s and Russia need to halt all production to balance the market?  Really?  What about the United States??  Why isn’t the U.S. included in these figures??

MORE BULL SHYTE: U.S. Calling on Saudis to Halt Plan to Unleash Record Oil Supply

With the United States now the largest oil producer in the world, why are Oil Company CEO’s and politicians calling for Saudi Arabia to halt oil supply?  It’s quite simple.. the U.S. has the most expensive and unsustainable oil supply in the world. If we go by FACTS and not hype or political grandstanding, the U.S. Shale oil industry has increased oil production growth FIVE TIMES more than Saudi Arabia over the past decade:

With the United States oil production growth of 84% versus 16% for Saudi Arabia, why should the Saudi’s cut production??  Furthermore, the Saudi’s have been selling their oil at a discount, $25 a barrel.  Unfortunately, U.S. WTIC crude now trading at $22.84 and North Dakota Light Sweet fetching a lousy $14.25, where’s the REAL PROBLEM taking place???

You got it… these super-low oil prices are GUTTING the entire U.S. Shale Oil Industry… backward, forward, upside-down and inside-out… LOL.  Thus, U.S. politicians are desperate because the notion of “Energy Independence” and the “Dollar Dominance” comes under severe pressure.

The Destruction Of the Global Oil Industry Is Disastrous For The Highly-Leveraged Debt-Based Financial System

As I watch the POOR SLOB ANALYSTS on CNBC trying to make a case that the market has hit bottom, I wonder if they have any idea about the massive carnage taking place in the MAIN DRIVER of the economy… the Global Oil Industry. 

Not a chance… so, while we have to continue listening to these Wall Street Clowns on CNBC, they do not realize their occupation is no longer necessary.

WALL STREET IS DEAD… it just doesn’t know it yet.

I have mentioned several times in articles and youtube videos that it wouldn’t take much of a decline in the global oil supply to take down the Highly Leveraged Debt-Based Financial System.  Unfortunately, what we got with this global contagion is TEN TIMES WORSE.  Thus, the global financial system is now in the process of disintegrating right before our eyes in glorious 3D Widescreen Technicolor, even with the Fed and Central Banks intervention.

All the Central Banks can do at this point is to KEEP THE TERMINAL PATIENT ALIVE a bit longer. We have no idea what the world looks like when 20-25% of oil production is lost.  This will totally destroy the U.S. Treasury Market that is based upon growing oil supplies to remain viable. 

Have you have ever thought about how a 30 Year U.S. Treasury gets repaid???  You need 30 years of global growth to allow that 30-year U.S. Treasury to be paid back.  These Treasuries aren’t just PAPER CERTIFICATES.. they are based on a business model of growth.  And growth is based upon oil production growth.  Thus, a 20-25% decline in global oil production will DESTROY the Stock and Bond Markets while Wall Street continues to regurgitate the V-SHAPED RECOVERY or a RETURN TO NORMALCY by next year.

Again, these poor slobs have no idea of what’s coming ahead.

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Dr Sucharit Bhakdi is a specialist in microbiology. He was a professor at the Johannes Gutenberg University in Mainz and head of the Institute for Medical Microbiology and Hygiene and one of the most cited research scientists in German history.

What he says:

We are afraid that 1 million infections with the new virus will lead to 30 deaths per day over the next 100 days. But we do not realise that 20, 30, 40 or 100 patients positive for normal coronaviruses are already dying every day.

[The government’s anti-COVID19 measures] are grotesque, absurd and very dangerous […] The life expectancy of millions is being shortened. The horrifying impact on the world economy threatens the existence of countless people. The consequences on medical care are profound. Already services to patients in need are reduced, operations cancelled, practices empty, hospital personnel dwindling. All this will impact profoundly on our whole society.

All these measures are leading to self-destruction and collective suicide based on nothing but a spook.

12 Experts Questioning the Coronavirus Panic

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Isolation – Joy Division

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We have learned historically that if we can isolate sick people, we can often keep a communicable disease from spreading. Unfortunately, the situation with the new coronavirus causing COVID-19 is different: We can’t reliability determine which people are spreading the disease. Furthermore, the disease seems to transmit in many different ways simultaneously.

Politicians and health organizations like to show that they are “doing something.” Because of the strange nature of COVID-19, however, doing something is mostly a time-shifting exercise: With quarantines and other containment efforts, there will be fewer cases now, but this will be mostly or entirely offset by more cases later. Whether time-shifting reduces deaths and eases hospital care depends upon whether medical advances are sufficiently great during the time gained to improve outcomes.

We tend to lose sight of the fact that an economy cannot simply be shut down for a period and then start up again at close to its former level of production. China seems to have seriously overdone its use of quarantines. It seems likely that its economy can never fully recover. The permanent loss of a significant part of China’s productive output seems likely to send the world economy into a tailspin, regardless of what other economies do.

Before undertaking containment efforts of any kind, decision-makers need to look carefully at several issues:

  • Laying-off workers, even for a short time, severely adversely affects the economy.
  • The expected length of delay in cases made possible by quarantines is likely to be very short, sometimes lasting not much longer than the quarantines themselves.
  • We seem to need a very rapid improvement in our ability to treat COVID-19 cases for containment efforts to make sense, if we cannot stamp out the disease completely.

Because of these issues, it is very easy to overdo quarantines and other containment efforts.

In the sections below, I explain some parts of this problem.

[1] The aim of coronavirus quarantines is mostly to slow down the spread of the virus, not to stop its spread.

As a practical matter, it is virtually impossible to stop the spread of the new coronavirus.

In order to completely stop its spread, we would need to separate each person from every other person, as well as from possible animal carriers, for something like a month. In this way, people who are carriers for the disease or actually have the disease would hopefully have time to get over their illnesses. Perhaps airborne viruses would dissipate and viruses on solid surfaces would have time to deteriorate.

This clearly could not work. People would need to be separated from their children and pets. All businesses, including food sales, would have to stop. Electricity would likely stop, especially in areas where storms bring down power lines. No fuel would be available for vehicles of any kind. If a home catches fire, the fire would need to burn until a lack of material to burn stops it. If a baby needs to be delivered, there would be no midwife or hospital services available. If a person happened to have an appendicitis, it would simply need to resolve itself at home, however that worked out.

Bigger groups could in theory be quarantined together, but then the length of time for the quarantine would need to be greatly lengthened, to account for the possibility that one person might catch the disease from someone else in the group. The bigger the group; the longer the chain might continue. A group might be a single family sharing a home; it could also be a group of people in an apartment building that shares a common ventilating system.

[2] An economy is in many ways like a human being or other animal. Its operation cannot be stopped for a month or more, without bringing the economy to an end. 

I sometimes write about the economy being a self-organizing networked system that is powered by energy. In physics terms, the name for such a system is a dissipative structure. Human beings are dissipative structures, as are hurricanes and stars, such as the sun.

Human beings cannot stop eating and breathing for a month. They cannot have sleep apnea for an hour at a time, and function afterward.

Economies cannot stop functioning for a month and afterward resume operations at their previous level. Too many people will have lost their jobs; too many businesses will have failed in the meantime. If the closures continue for two or three months, the problem becomes very serious. We are probably kidding ourselves if we think that China can come back to the same level that it was at before the new coronavirus hit.

In a way, keeping an economy operating is as important as preventing deaths from COVID-19. Without food, water and wage-producing jobs (which allow people to buy necessary goods and services), the deaths from the loss of the economy would be far greater than the direct deaths from the coronavirus.

[3] A reasonable guess is that nearly all of us will face multiple exposures to the new coronavirus. 

Many people are hoping that this wave of the coronavirus will be stopped by warmer weather, perhaps in May or June. We don’t know whether this will happen or not. If the coronavirus does stop, there is a good chance the same virus, or a close variation of it, will be back again this fall. It is likely to come back in waves later, for at least one more year. In fact, if no vaccine is found, it is possible that it could come back, in various variations, indefinitely. There are many things we simply don’t know with certainty at this time.

Epidemiologists talk about the spread of a virus being stopped at the community immunity level. Harvard epidemiologist Marc Lipsitch originally estimated that 40% to 70% of the world’s population would come down with COVID-19 within the first year. He has revised this and now states that it is plausible that 20% to 60% of the world’s population will catch the disease in that timeframe. He also indicates that if the virus cannot be contained, the only way to get it under control is for 50% of the world’s population to become immune to it.

The big issue with containing the coronavirus is that we cannot really tell who has it and who does not. The tests available for COVID-19 are expensive, so giving the test to everyone, frequently, makes no sense. The tests tend to give a many false negatives, so even when they are given, they don’t necessarily detect people with the disease. There are also many people who seem to spread the disease without symptoms. Without testing everyone, these people will never be found.

(mais…)

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This report is the product of a collaboration between a retired professional scientist with dozens of peer-reviewed publications and 30 years of experience in genomic sequencing and analysis who worked at the Theoretical Biology Division of the Los Alamos National Laboratory, and later helped design several ubiquitous bioinformatic software tools, and a former NSA counterterrorism analyst. It considers whether the Wuhan Strain of coronavirus (COVID-19) is the result of naturally emergent mutations against the possibility that it may be a bio-engineered strain – directly altered by genetic manipulation, subject to artificially-guided evolutionary selection, or both – most likely released into the public by accident since China’s rate of occupational accidents is about ten-times higher than America’s, and some twenty-times more than Europe’s, the only other regions with high-level virology labs.

Raising the odds of an accidental release, researchers from China’s only BSL-4 lab in Wuhan were reported to have particularly sloppy field research methods, being both bled and peed on by local bats that host coronaviruses remarkably similar to the Wuhan Strain COVID-19. And they’ve also been reported to smuggle used research animals out of their labs, selling them for cash on the street. Perhaps unsurprisingly, in mid February the Chinese Ministry of Science sent out a directive to all its labs emphasizing the important of carefully handling bio-infectious agents and alluding to slack oversight and past lapses.

Mistakes may have been precipitated by the need to quickly finish research that was being rushed for John Hopkins’ Event 201 which was held this past October and meant to gameplan the containment of a global pandemic. Research may also have been hurried due to deadlines before the impending Chinese New Year – the timing of these events point to increased human error, not a globalist conspiracy. Beijing has had four known accidental leaks of the SARS virus in recent years, so there is absolutely no reason to assume that this strain of coronavirus from Wuhan didn’t accidentally leak out as well. This is unlikely to be a plot twist in one of the novels Tom Clancy wrote after he started mailing it in.

Simply and horribly, this is likely to become another Chernobyl or Fukushima – a catastrophic illustration of mankind’s hubris and intransigence clashing with Nature, as fate again reaps a once unimaginably tragic toll.

Given that this outbreak was said to begin in late December when most bat species in the region are hibernating and the Chinese horseshoe bat’s habitat covers an enormous swath of the region containing scores of cities and hundreds of millions people to begin with, the fact that this Wuhan Strain of coronavirus, denoted as COVID-19 emerged in close proximity to the only BSL-4 virology lab in China, now notoriously located in Wuhan, which in turn was staffed with at least two Chinese scientists – Zhengli Shi and Xing-Yi Ge – both virologists who had previously worked at an American lab which already bio-engineered an incredibly virulent strain of bat coronavirus – the accidental release of a bio-engineered virus from Wuhan’s virology lab cannot be automatically discounted, especially when the Wuhan Strain’s unnatural genomic signals are considered.


UPDATE 2/14, 3:02am EST: A probable smoking pre-print has been released, by the National Natural Science Foundation of China:

“In summary, somebody was entangled with the evolution of 2019-nCoV coronavirus. In addition to origins of natural recombination and intermediate host, the killer coronavirus probably originated from a laboratory in Wuhan.”

In a predictable turn, that article has been removed and both researchers have since deleted their profiles off of the ResearchGate site completely. Furthering the appearance of a cover-up, back on January 2nd, the Wuhan Institute of Virology’s director sent out a memo forbidding discussion of an “unknown pneumonia in Wuhan” after ordering the destruction of all related lab materials a day earlier, making it abundantly clear that the Chinese government knew about this outbreak long before they took any steps to contain it, or made any public announcement.

These propaganda efforts have been bolstered by possible collusion from American scientists, some of which is detailed below – but also most notably by one Peter Daszak, who had been publishing papers on coronaviruses alongside the primary Chinese person-of-interest, Zhengli Shi, for years. Perhaps most notably, Daszak is listed as a co-author in the paper first documenting the isolation of a coronavirus from a bat that targets the ACE2 receptor – just like COVID-19 – which was done in Wuhan’s virology lab supervised by Zhengli Shi, and led by a second suspect Chinese researcher who you’ll meet below. At best, Daszak is perhaps acting as an unwitting agent of the Chinese government, but regardless holds an enormous conflict-of-interest. And if nothing else, it is wildly irresponsible to speak-out against the possibility that the virus got out of a lab when a natural origin has not been conclusively demonstrated. Daszak’s statement in The Lancet is either incompetence, or is meant to be a smokescreen for the wanton hubris and greed that have fueled the gain-of-function research detailed below: As one possible related project which may have overlapped with this one, coronaviruses have been seen as a viable vector for an HIV vaccine for years – a project with hundreds of millions of dollars dangling over it.

Being an offshoot of this sort of vaccine program, possibly as a Red Team designed to build defenses against, is just one possible gain-of-function pursuit that would fit some of the unusual genomic picture below. Whether or not it was the exact target of the Wuhan lab’s genomic tinkering – the reality is millions of dollars of funding from multiple world governments have poured into this research, funding that’s dangled over these scientists as they’ve chased it like Icarus, this time not just risking their own lives – but hundreds of millions of others as well.

Subsequently, we are calling for an immediate end to dual-use gain-of-function research.


– In 2002, Stony Brook first assembled a virus from scratch, building a polio-virus, and providing proof-of-concept for the creation, alteration, and manipulation of viral genomes. Two years prior, a separate team had already built an infectious RNA virus from scratch – choosing to engineer a coronavirus from scratch, and even swapping out its vital spike-protein genes. And a generation earlier, artificially enhancing selection by intentionally infecting countless series of lab animals with different viruses is understood to have created the H1N1 Swine Flu. Its Franken-genome has a mysterious untraceable genetic parentage and a “clear unnatural origin,” and H1N1 became the poster-child for a moratorium against gain-of-function research – experimentation that seeks to increase a pathogen’s virulence, creating a more effective double-edged sword to counter and learn from. In the case of H1N1, it wasn’t a question of if it’d escaped from a research laboratory, only whether it’d been designed as part of a weapons system, or been part of a vaccine trial.

– Tinkering with viral genomes is not anything new, but is not something that has ever been fully embraced by the scientific community at large. About a decade ago, two separate research teams successful tweaked the genome of the H5N1 Bird Flu in just two spots and then passed it through ferrets until it became both airborne and pathogenic to mammals, creating a virus that “could make the deadly 1918 pandemic look like a pesky cold.” This involved selecting for a mutation that allowed the virus to access a receptor that’s found in ferret lungs, and was alarming enough that the research was urged to be published without revealing the specific methods involved and data collected – however it appears that only the most technical details were left out, and most of the research is freely available.

– By 2015, conducting research that was met with an enormous amount of concern, scientists at UNC had successfully created a “chimeric, SARS-like virus” by altering the viral genome of a Chinese bat coronavirus’s spike-protein genes – sequences that code for the spikes that poke out from surface of viruses and allow them to unlock entry into hosts, in this case making the bio-engineered coronavirus incredibly contagious. This research raised eyebrows since it was clearly gain-of-function research, a practice banned in America from 2014 until December 2017 when NIH lifted the ban, specifically to allow research on this sort of virus. Looking at UNC’s gain-of-function research on coronavirus spike-proteins, which received its funding just before the ban was implemented and was only allowed to go forward following a special review, a virologist with the Louis Pasteur Institute of Paris warned: “If the [new] virus escaped, nobody could predict the trajectory.” 

– But then oddly, in late January right as the pandemic was blooming, Dr. Ralph Baric claimed in an interview that people should be more concerned with the seasonal flu – despite having personally overseen the controversial engineering of a hyper-virulent strain of batty coronavirus just a few years back. Immediately discounting the burgeoning outbreak of an unknown coronavirus as a non-event seems particularly troubling for someone who’d trained two Chinese scientists on how to make hyper-virulent coronaviruses, especially when it’s hard to imagine that Dr. Baric was unaware his past colleagues were now working at the Wuhan Virology Lab, the epicenter of the outbreak. Highlighting the dissembling absurdity of this statement, based on reporting from Who: the Wuhan Strain COVID-19 appears to be thirty-four times more lethal than the seasonal flu.

– Scientists have expressed concern about China’s ability to safely monitor this BSL-4 lab in Wuhan since it opened in 2017: “an open culture is important to keeping BSL-4 labs safe, and he questions how easy this will be in China, where society emphasizes hierarchy. ‘Diversity of viewpoint, flat structures where everyone feels free to speak up and openness of information are important.’” This lab is at most 20 miles from the wet market where the virus had been assumed to have jumped from animal to human. However the idea that a Chinese lab could have a viral sample escape is well-documented – as mentioned, one lab in Beijing has had four separate incidents of the SARS virus leaking out accidentally.

– Notably, the first three known cases from early December had no contact with that market, and roughly one-third of the initial exposed cohort had no direct ties to Wusan’s wild meat wet-market, the original presumptive source of the virus. And in mid February, reporting indicated that COVID-19’s patient zero in fact had no connection at all with the wet-market. This is reinforced by the fact Chinese research has also concluded that COVID-19 “may have begun human-to-human transmission in late November from a place other than the Huanan seafood market in Wuhan.”

– Since its discovery, scientists have been unable to fully determine the zoological origins of COVID-19, it was initially thought to have passed through snakes, but now all that’s agreed upon is that it’s mostly bat in origin. This inability to derive an exact zoological source is exactly what would be expected if the virus had been artificially engineered to target humans as UNC already has, this doesn’t prove an artificial nature – but it is consistent with one. Although there has been speculation that pangolins may have been the missing vector, the only data about the pangolin virome wasn’t entered into NCBI’s system until late January, and couldn’t possibly have been collected any earlier than late September 2019, and doesn’t fully answer the vector question anyways. And further research indicated it was “very unlikely” that similarities between their spike-protein genomes of COVID-19 and pangolins, where they share the most similarities, was due to the virus passing through pangolins at all.

– As explained in Nature, COVID-19’s Franken-genome combines a cornucopia of distinct genetic markers from each of the three other distinct branches of the coronavirus family tree, but is distinct enough from all of them that it in fact forms its own clade. Along those same lines, a full-genome evolutionary analysis of COVID-19 published in The Lancet concluded, “recombination is probably not the reason for emergence of this virus” since it seems that the Wuhan Strain isn’t a mosaic of previously known coronaviruses, but instead draws from distant, discrete parts of the coronavirus family tree – not how these viruses naturally evolve. Because even mixing and matching coronavirus genomes from every known zoological virus, scientists couldn’t find any possible combination that would explain those regions of the Wuhan Strain’s genome. The Lancet muses that a mysterious animal host could still be out there, however since they’ve already searched through every known possibility and been unable to find a match, another obvious explanation is that bio-engineering accounts for the inexplicable nucleotide signature of the Wuhan Strain’s genome

– Early research found that COVID-19 targets the ACE2 receptor, which seems to be distributed in roughly equal proportions across global populations, indicating that the Wuhan Strain was likely developed as part of a defensive gain-of-function project possibly linked to immunotherapy or vaccinations – never meant to leave the lab, but meant to serve as a Red Team to fight back against, not as an offensive weapon targeting one specific global population. But counter-intuitively, researchers have pointed out that the most critical sections of the COVID-19’s protein-spike genome don’t match the previously reported pattern that would be expected for optimal binding to the specific ACE2 receptors found only in humans and ferrets, which indicates that these particular segments wouldn’t have been directly genetically engineered to increase virulence.

– And yet this is exactly what researchers looking for a “safe” vaccine candidate would engineer, and doesn’t rule out a scenario where the virus was passed through a series of ferrets. The research team in fact notes that its spike “appears to be the result of selection on human or human-like ACE2 permitting another optimal binding solution to arise,” failing to directly mention that the only other human-like receptors are found in ferrets – which have frequently been used for years in vaccine trials for viruses with this sort of protein-spike, and is exactly how the H5N1 Bird Flu virus was altered to make it airborne. And so the Wuhan Strain’s unique affinity for the human ACE2 receptor, which a pre-print reports to be 10 to 20 times greater than SARS, may be the exact type of vaccine-related accident that led to the moratorium on gain-of-function research in the first place and caused scientists to unsuccessfully call for the research around H5N1 to be partially sealed-off.

– The Wuhan Strain of coronavirus, COVID-19, appears to be transmissible even before its host shows any symptoms at all, making temperature-scanning at airports ineffective since hosts appear to be contagious for about a week before any symptoms emerge. This is in stark contrast with SARS, whose hosts weren’t contagious until they were symptomatic, allowing for its relatively quick containment. This chart is not from a peer-reviewed source but was claims to capture the comparative rates of infections between recent outbreaks. A recent pre-print now gives COVID-19 a rating of R4, meaning each host passes the virus on to four new victims, a rate significantly higher than any past global viral outbreak.

– The successful end results of the aforementioned  bat coronavirus bio-engineering research at UNC that was critiqued for being too risky in 2015, was published the following year and described the successful bio-engineering of a highly-virulent coronavirus derived from bats which was achieved by tinkering with its spike-protein genes. In this paper, researcher #8 is listed as one “Zheng-li Shi” who’s listed as being attached to the “Key Laboratory of Special Pathogens and Biosafety, Wuhan Institute of Virology, Chinese Academy of Sciences, Wuhan, China.”

– Zhengli Shi seems to have returned to Wuhan at some point since 2016, specifically to the Wuhan Institute of Virology’s Disease Engineering Technical Research Center,  since she then appears in this September 2019 paper on the human behaviors most likely to lead to bat-borne coronavirus exposure in southern China, and also in the paper claiming that this coronavirus was bat in origin, which was peculiarly submitted in coordination with the announcement of the outbreak. Very, very peculiarly. She also appears in this pending preprint on the current outbreak of COVID-19, just a small sample of the dozens of coronavirus-related papers she’s published over a three decade career.

– Not only does Zhengli Shi provide a direct chain of expertise tying the already successful bio-engineering of a virulent bat-based coronavirus at UNC directly to the BSL-4 virology lab in Wuhan, but back in January 2014 she’d received a $665,000 grant from NIH for a study titled The Ecology of Bat Coronaviruses and the Risk of Future Coronavirus Emergence (NIAID R01 AI1 10964) as well as $559,500 more from USAID for a study titled Emerging Pandemic Threats PREDICT_2China (Project No. AID-OAA-A-14-00102). Beyond this American funding specifically into viral diseases zoonotically transferring from animals to humans which would slipped in just before the ban, over the years she’s also received around $3 million in grants to study these zoonotic viruses from China and other countries, and has served on the editorial board of several virological research magazines. More of her research into the intersection of coronaviruses like the Wuhan Strain and their epidemic potential was funded by the U.S. Department of Defense, the U.S. Threat Reduction Agency, and U.S. Biological Defense Research Directorate of the Naval Medical Research Center.

(mais…)

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David Korowicz

In China the circulation of people, goods and services has slowed and fragmented. An already weakening economy is now experiencing a major shock through the networks that sustain human welfare and societal functioning. Energy consumption is the most fundamental measure of economic activity and socio-economic complexity. Carbon Brief[i] has estimated that energy use was 25% below expectations in the two weeks following the end of the New Year holiday equivalent to the energy drop that occurred between 2012 and 2018 as Venezuela’s economy and society underwent its profound crisis[ii].

The longer the economy is undermined, the deeper the damage and the slower any recovery. Even if COVID-19 was to vanish this moment, the shock would ripple on as indebtedness, bankruptcy, lost purchasing power, and supply-chain choke points continued to drag on recovery.

The government will no-doubt do everything they can to support businesses and the banking system with credit and stimulus, adding yet more debt to an already overindebted system. That will constrain future economic growth, increase the likelihood of future financial crises, and make the country less resilient to the next shock, from whatever the source. It is also straining political legitimacy, adding further uncertainty.

China’s centrality to global systems integration is being vividly demonstrated as viral, supply-chain, demand, information and financial system contagion transmit through global society. The emergence of new infection epicentres and containment measures open additional sources of contagion processes. The emergence of multiple intensifying and interacting cascading processes generates fundamental uncertainty, with attendant growing tail risks. Economic models are largely blind to the structure of very large cascading shocks and will tend to underestimate impacts.

This shock is propagating through a global economy that prior to the virus had declining resilience and adaptive capacity. Weakening economic growth, ever-growing indebtedness, increased tensions within and between countries, and the growing potential for shocks from climate and environmental change, and resource constraints and disruptions, mean we were already in uncertain and dangerous territory. The warning in January 2020 by Kristalina Georgieva, the head of the International Monetary Fund, that the global economy risks the return of the Great Depression, surprised few[iii]. It’s no longer the preserve of peripheral Cassandras to warn of escalating systemic risk.

The extent of the damage this will do to the economy and society is unclear. Beyond the impact on health and healthcare systems, it exposes the web of synchronized social and economic conditions that constitute the operational conditions of our day-to-day lives. That we take them for granted is a measure of our habituation to systemic stability. The more that this is disrupted by the direct and indirect impacts of the pandemic, the greater the potential for further disruption. This is true at scales from the local to global. The inherent uncertainty reflects our ignorance of the complexity of our dependencies, and our behavioural and cultural adaptation to those conditions.

Slower global growth and an increase in the likelihood of a financial crisis can be expected. If process contagion begins to accelerate significantly, there are limits on how much governments and central banks can do to respond. Injecting stimulus can address a demand shock, but it would have limited supply-side effectiveness. Assuming a deeper shock (equivalent to the 2% GDP contraction during the Global Financial Crisis) followed by stabilization, society and economies will be left less resilient as it faces the increasingly turbulent years ahead.

At the furthest extreme there is runaway process contagion. In such a case supply-chain contagion (broadly defined, including impacting critical infrastructure services, for example) would begin to severely undermine global socio-economic integration and coherence.  As it disintegrated and the forward-looking outlook became more uncertain, the failing financial system (credit, bank solvency, monetary stability and visibility, counter-party risk) would disrupt further supply-chains inducing a re-enforcing (positive feedback) supply-chain financial-system cross-contagion[iv]. No central bank can maintain a credit-monetary system if it’s core collateral, the expectation of economic production is opaque and collapsing in real-time. Beyond a tipping point, this could accelerate rapidly. It would effectively shut-down the flow of goods and services. Were this to happen, it would be a global catastrophe of unprecedented scale and duration.

This latter outcome is very unlikely.

There are two elements that can be seen in the overview above. The first is related to the structure of civilisation, societal vulnerability, and the potential for contagion, and in extremis, collapse. The second is that society for broader reasons is losing resilience to shocks, while stressors, environmental and socio-economic, are growing in range and intensity. This means societal systems may have entered a period of sustained global destabilization, coupled to an increasing likelihood of catastrophic systems failure. It is to these elements that we now briefly turn our attention to.

Dependency and Systemic Vulnerability

We have become ever-more part of a singular civilizational organism that has grown in scale, complexity, interdependence, and speed. As it has evolved, it has optimized towards growth, efficiency and self-stabilization. People, organisations, businesses, and countries can design and influence it in parts, but the whole is the emergent outcome of many interactions evolving over time. There’s nobody in control. It is these structural and dynamical properties that define societal stability, resilience, vulnerability, the propensity to contagion processes, global systemic destabilization, and collapse dynamics.

Our ability to sustain our basic needs anywhere, now depends upon system integration everywhere. That means no infrastructure, society or country can be fully resilient as the conditions that maintain function are dispersed beyond visibility or control.

 

(mais…)

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The Consciousness of Sheep

Before you can fleece or slaughter sheep, you must first corral them.  Whether by accident or design, the stock market is the financial corral into which investors have been herded.  The measures used to bail out the global banking system after the 2008 crash – quantitative easing and ultra-low interest rates – may have kept the banks on life support, but they have also led to an ongoing yield crisis.

Whether you manage a savings scheme, a pension fund or an insurance company, you will have experienced a decade during which the returns on investment have been far lower than the returns you needed.  Pension and insurance business models – developed in the decades prior to 2008 – require an interest rate in the 5-8 percent range if they are to cover payments and continue to grow.  But safe assets like government bonds offer just a tenth of that; one reason why so many pension funds are in dispute with trade unions over cuts to pension rates.

One response to low interest rates in the immediate aftermath of the crash was a switch into so-called “junk bonds,” such as those issued by the US fracking companies.  The more risk an investor was prepared to take, the higher the return… assuming the company – or, indeed, the whole industry – did not go bust in the meantime.  In the UK, commercial property offered similarly high rates of return, as property management companies assumed they could simply jack up rents whenever they felt like it.  This, however, has added to the retail apocalypse on Britain’s high streets, with retail companies using the threat of insolvency to negotiate rents down to something more manageable.

As a result of the antics of the central banks, the stock markets became the single oasis in the yield desert.  When a listed company issues shares it is effectively borrowing money from the public.  The annual dividend is the equivalent of interest on savings.  While this is of little concern to the majority of traders, who merely gamble on the rise and fall of share prices, it is a big deal to corporate managers whose remuneration packages are linked to the share value of their companies.  If, for example, the dividend equates to an interest rate of five percent, but the central bank allows corporate borrowers to take out loans at just 0.5 percent, it makes sense for corporate managers to borrow in order to buy back the company shares – the equivalent of paying off a loan earlier than it is due.

The wider problem with this in the post-2008 climate is that everyone has been doing the same thing.  And given the broader lack of yield, the result has been massive inflation in the price of shares; both because there are fewer of them for sale and because more and more people want to buy them.  The result was the biggest financial bubble that has ever been inflated; and a bubble so fragile that even something as tiny as a virus can puncture it.

The crash in share prices that has followed the central banks’ surrender to the coronavirus – having spent the last month pumping newly created currency into the markets – has filled the newsfeeds of the mainstream media.  The BBC, for example, reporting this morning that:

“Stock markets across the globe are suffering their worst week since the global financial crisis of 2008 as fears over the impact of the coronavirus continue to grip investors.

“Markets in Europe fell sharply on Friday morning, with London’s FTSE 100 index sinking more than 3%.

“Asian markets saw more big falls, while in the US, the Dow Jones recorded its biggest daily points drop on Thursday.

“Investors are worried the coronavirus impact could spark a global recession.”

In truth, the only “news” in this story is why it didn’t happen earlier – a question that the mainstream media doesn’t even understand.

The financial economy is based on an illusion – the belief that the real economy will continue to grow in the future at the same rate that it grew in the past.  Currency – almost all of which is created in the form of interest bearing debt – only has value so long as the real economy can grow at a higher rate than the compound interest charged on the debt.  Growth in the real economy – the harvesting of natural and mineral resources, the manufacture of goods and the provision of services – depends, in turn, upon a growing amount of free energy to power everything.

From the mid-eighteenth century to the 1970s, economic growth has been driven by a growing volume of surplus fossil fuel energy.  The crises of the 1970s stemmed from a slowdown in the rate of surplus energy growth; causing a major supply-side shock that economists at the time did not believe could happen.  What we have come to call “neoliberalism” – the depoliticising of national economies; the globalisation of production; and the liberalisation of the financial sector – was the intended solution to that crisis.  But it no more solved the crisis than quantitative easing and low interest rates have solved the financial crisis of 2008.  In both cases, we merely kicked the can down the road in the vain hope that clever people somewhere else would come up with a solution.

As with every previous civilisation that has expanded beyond its energetic limits, industrial civilisation has attempted to resolve its contradictions by adding complexity.  The creation of the first truly global economy to replace the interconnected national economies of the twentieth century drove down wages and produced efficiencies which allowed the more energy-constrained economy to continue for a few more decades.  But the additional complexity came at the cost of reduced resilience.

In the years after World War Two, western economies duplicated whole industries.  Britain. For example, had car and aviation industries which sourced their components from within the UK; the same for France, Germany and the USA.  Today, by contrast, western companies are often no more than final assembly points; putting together component parts manufactured on the other side of the planet.  Indeed, companies like Apple do not even assemble anything, but simply repackage finished electronic goods that are manufactured in Asia.  The positive side of this is that the price of manufactured goods has been driven down to the point that they offset rising food, housing and energy costs in national inflation statistics.  The downside, though, is that any disruption to the supply of any of the billions of components and raw materials that flow around the global shipping lanes on a just-in-time basis can bring an entire industry to a halt.

In the aftermath of the Fukushima disaster, several car manufacturers were brought to a halt because the supply of car bumpers was disrupted.  Not because car bumpers were made in Fukushima, but because the black pigment used to dye the plastic used in car bumpers was made by a plant based in the Fukushima exclusion zone.  The more dependent we become upon complex global supply chains, the more at risk we are from events that may not – at first sight – seem to have anything to do with us.  As Richard Wilding at The Engineer points out:

“What might look like a localised crisis quickly has a global impact because supply chains are a network, companies are linked by international processes and network designs. And competition, essentially, is not between individual companies but the supply chains they are part of…

“It’s still common for businesses to just deal with a central HQ of a supplier and not know exactly what route the supplies they need are taking. How many of us when we buy a product from Amazon knows the actual source and transport chain involved?”

This brings us to the Covid-19 pandemic that appears to be the cause of the ongoing collapse in share prices.  There is still a great deal that we don’t know about the virus – how quickly it spreads, what proportion of people who contract it become seriously ill, and how many of those die from the disease.  Much depends on how the authorities respond, how the public behaves, and on the extent to which advanced western health systems are able to manage.  But the virus is not really the cause of economic woes which are only just beginning; they are merely a trigger.

The global economy is a house of cards that was just waiting for someone or something to pull the bottom out from under.  If it wasn’t a virus, it would have been a flood, a volcano, a solar flare, or some other unexpected disaster.  Nevertheless, the fact that China locked down towns and cities in a major global manufacturing region beginning on 23 January means that Britain is going to experience shortages from the first week in March.  It takes around 40 days for a container ship to make the journey from China to the UK, meaning that the goods we are currently consuming set sail before the lockdown began.  In the course of next week, the just-in-time container ships that we have come to rely upon for everything from phones to fabrics and pharmaceuticals are not going to appear.  And even if China were to lift restrictions immediately, we would still be looking at nearly six weeks without supply; followed by many more weeks in which we are playing catch up.  As Rory Butler at The Manufacturer explains:

(mais…)

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