Strange Days

by Jim Kunstler

Even while a wave of reflex nausea washed over America last week, and the unemployment rolls swelled by much more than another half million, the greatest stock market suckers' rally in seventy years pulled in the last of the credulous. These are strange days. The earth is heaving and the buds swelling again -- at least north of the equator, where most of the action is -- and the global economy, which was supposed to be a permanent new add-on to the human condition, is sloughing away in big horrid gobs. But no one in charge of anything can believe it. The banking fiasco has introduced so much noise into the system that world leadership can't think straight.

What they're missing is real simple: peak oil means no more ability to service debt at all levels, personal, corporate, and government. End of story. All the other exertions being performed in opposition to this basic fact-of-life amount to a spastic soft-shoe performed before a smokescreen concealing a world of hurt. If the "quantitative easing" (money creation) and fiscal legerdemain (TARPs, TARFs, et cetera) happen to jack up the "velocity" of the new funny-money, and the world resumes its previous level of oil use, the price of oil would rise again -- this time astronomically because the previous crash of oil prices crushed the development of new oil projects to offset depletion -- and the global economy will crash again. Only the next phase of the disease is liable to move beyond the financial and into the social and political realms. Disorder of various kinds will rule -- toppled governments, civil unrest, international tension and conflict.

Read on...

Peacenik survived the wilderness, torrential rains, a Spring snowstorm, flooded roads and the lack of news. Peacenik melted snow, and burned wood, and ate leftovers and Peacenike survived. Now Peacenik discovers that over the weekend nothing changed....for the better. Peacenik has a sense that things may be even worse. The suckers rally on Wall St. looks like it could run out of gas this week. And there isn't much left for investors to pin their hopes on. After reading Kunstler's post, Peacenik is glad that Peacenik is not a Wall St. banker. Their future looks scary. Very scary.

It's Not Going to Be OK

By Chris Hedges, Truthdig. Posted February 4, 2009.

The economic crisis could plunge the U.S. into a long period of social instability. Our democracy is in peril; the threat of totalitarianism is real.

The daily bleeding of thousands of jobs will soon turn our economic crisis into a political crisis. The street protests, strikes and riots that have rattled France, Turkey, Greece, Ukraine, Russia, Latvia, Lithuania, Bulgaria and Iceland will descend on us. It is only a matter of time. And not much time. When things start to go sour, when Barack Obama is exposed as a mortal waving a sword at a tidal wave, the United States could plunge into a long period of precarious social instability.

At no period in American history has our democracy been in such peril or has the possibility of totalitarianism been as real. Our way of life is over. Our profligate consumption is finished. Our children will never have the standard of living we had. And poverty and despair will sweep across the landscape like a plague. This is the bleak future. There is nothing President Obama can do to stop it. It has been decades in the making. It cannot be undone with a trillion or two trillion dollars in bailout money. Our empire is dying. Our economy has collapsed.

Read on...

In an earlier post Peacenik wondered why there was no rioting in the U.S. as the economy swirls down the toilet. This post, by Chris Hedges, offers up some interesting theories as to why the populace is so passive. And it doesn't bode well. The corporate media and a willingness to be distracted by entertainment all contribute. But Peacenik thinks the collapse will be so profound that violence and riots will occur. The corporate media is losing its influence to the horrible bloggers. Major newspapers are going out of business. The public is finally getting angry about executive compensation. There is a tipping point. It is close.