Why Care? - Humanity's Final Hours...

Why Care?

Humanity’s Final Hours...

Good Evening,

Recently, in an open forum of scientists, economists, academics and other professionals, most of whom are pretty much resigned to the idea that the outlook for the human species is not that good, an important question was raised. Some strongly  believe that extinction is just around the corner; there is about a 50-50 chance; at best, that only a few of us will be remaining by the turn of this century. 

For certain. it is hard to combat their arguments, as we face climate change, peak oil, mineral scarcity, financial and biodiversity collapse and many other threats. One "Black Swan" could be lurking anywhere in our midst. Furthermore, as you should know by now, Stephen Hawking sits on a recently formed study group, charged with planning for end-of-days-events. So given the apparent certainty of matters, it is almost a natural outcome as we struggle against seemingly impossible odds that this question comes to bear - WHY CARE?

Below is a copy of my answer to this question. Looking back on it a few days later, it is a sort of a fuller version of Yogi Berra's famous quote "it ain't over, ' til its over". However, this is no game - the consequences of what may lie ahead defies any and all imaginations. We would also be happy to hear your thoughts in this regard, either by way of email or comments to this post. 

Either way, we will share these responses with readers for the  sake of the unyielding responsibilities that we share to the future generations of our kind. 


Of Kind Regards
Terry
September 29, 2013


Comments of September 27, 2013

Personally, I just look into the eyes of children. That is all the poetry of reasons one needs. Power may corrupt, but poetry does cleanse. (JFK)

Otherwise, clinically for the most part I would concur with Steve, save that nothing or anything is assured, but many unknowns are possible. If we know so much, how come we didn't know how to avoid our current predicament?  Hence, what do we really know?

I would also subscribe to the thrust of Paul Chefurka's views in his recent article, "Paradise Lost" , insofar as we are tied in action and thought to the laws of the universe; as we understand them, and most particularly, the Second Law of Thermodynamics; that in turn creates our energy-seeking hunger. However, there are are even issues regarding the Laws of Thermodynamics that remain unresolved, as we do not know what laws and conditions gave rise to their existence in the first place. An then even those conditions undoubtedly would also being following a set of instructions that are embedded in existence, yet so far, remain beyond our knowledge, devices and discovery. Perhaps ole Socrates had a little insight into quantum physics, as well? 

Referring back to Paradise Lost, my closing thoughts with regard  to all this are recorded as follows:

"Hence in our last analysis, it as certain as it gets that we cannot defeat eternity, but that in itself should not dissuade us from seeking to optimize our entropic relationship with the universe in pursuit of a longer path. Too many things could happen along the way"

So...

"Attitude is  a little thing.

But it makes a big difference"  - W Churchill

T.A.McNeil 

CEO and Founder

First Financial Insights

September 27, 2013 

So many reasons...

Paul Chefurka - "Paradise Lost"

“Paradise Lost”

Paul Chefurka

Many of us who have been paying attention to the state of the world over the last half-century have now begun to realize with growing horror that the progressive deterioration we have been tracking shows no signs of resolution   In fact, to some of us it looks as though there is no way to resolve this deepening crisis. The end of the track is in sight. The planetary factory is in flames, and all the exit doors are barred.

Proposed technical solutions are utterly inadequate to the scale of the problem.  Many ideas like geoengineering will simply make matters worse.  There is no political constituency for degrowth – none at all.  There is precious little political support for even putting a light foot on the brake.  This road to Hell has been paved with the very best of intentions – giving our children a better life stands near the top of the list – but here we are nonetheless. The climate is signaling that our future may be a little warmer than we were expecting, once our seven-billion-passenger train passes those gates.

Now that the denouement is in sight, I’m setting aside the anger and outrage, the blame and shame, to focus my attention instead on why this outcome seems to have been utterly inevitable and unstoppable.

Why has this happened?  I don’t buy the traditional “broken morality” or “flawed genetics” arguments.  After all, our genetics seemed to be perfectly appropriate for a million years, and the elements of morality that some of us see as sub-optimal (the greed and shortsightedness) have been with us to varying degrees since before the days of Australopithecus. I don’t think it’s just a mistake on our part or a bug in the program – it appears to be a part of the program of life itself. It looks to me as though much deeper forces have been at work throughout human history, and have shaped this outcome.

The main difficulty I have with all the technical, political, economic and social reform proposals I've seen is that they run counter to some very deep-seated aspects of human behavior and decision-making.  Mainly, they assume that human intelligence and analytical ability control our behavior, and from what I've seen, that’s simply not true.  In fact, it’s untrue to such an extent that I don’t even think it’s a “human” issue per se.

I have come to think that most of our collective choices and actions are shaped by physical forces so deep that they can’t even be called “genetic”.  I haven’t written anything definitive about this yet, but the conclusion I have come to in the last six months is that a physical principle called the "Maximum Entropy Production Principle”, which is closely related to the Second Law of Thermodynamics, actually underlies the structure of life itself.  Its operation has shaped the energy-seeking, replicative behavior of everything from bacteria to humans.  All our intelligence does is make its operation more effective.

This principle is behind the appearance of life in the first place, has guided the development of genetic replication and natural selection, and has embedded itself in our behavior at the very deepest level. Like all life, our mandate is simple:  survive and reproduce so as to form a metastable dissipative structure.  All of human behavior and history have been oriented towards executing this mandate as effectively as possible.  This “survive and reproduce” program springs from a universal law of physics, much like gravity. As a result, it even precedes genetics as a driver of human behavior.  And lest there be any lingering doubt about the connection to our current predicament, the survival imperative is what causes all living organisms to exhibit energy-seeking behavior.  Humans just do this better than any other organism in the history of the planet because of our intelligence.

In this context, the evolutionary fitness role of human intelligence is to act as a limit-removal mechanism, to circumvent any obstacles in the way of making make our growth in terms of energy use and reproduction more effective.  It’s why we are blind to the need for limits both as individuals (in general) and collectively as cultures.  We acknowledge limits only when they are so close as to present an immediate existential threat, as they were and are in hunter-gatherer societies. As a result, we tend to make hard changes only in response to a crisis, not in advance of it.  Basically, the goal of life is to live rather than die, and to do this it must grow rather than shrink.  This imperative governs everything we think and do.

As a result, I don’t think humanity, in general, will put any kind of sustainability practices in place until long after they are actually needed (i.e. after population and consumption rates have begun to crash).  I don’t think it is possible for a group as large as 7 billion people to agree that such proactive measures are necessary.  We are as blind to the need for limits as a fish is to water and for similar reasons. After the crisis has incontrovertibly begun we’ll do all kinds of things, but by then we will be hampered by the climate crisis and by severe shortages of both resources and the technology needed to use them.

I have given up speculating on possible outcomes, because they are so inherently unpredictable, at least in detail.  But what I’m discovering about the way life works at a deep level makes me continually less optimistic.  I now think near-term human extinction (say within the next hundred years) has a significantly non-zero probability.

Our cybernetic civilization is approaching a "Kardashev Type 0/1 boundary" and I don’t think it's possible for us to make the jump to Type 1.  Like most other people, Kardashev misunderstood the underlying drivers of human behavior, assuming them to be a combination of ingenuity and free will.  We indeed have ingenuity, but only in the direction of growth (and damn the entropic consequences).  We can’t manage preemptive de-growth or even the application of the Precautionary Principle, because as a collective organism humanity doesn't actually have free will (despite what it feels like to us individual humans).  Instead, we exhibit emergent behavior that is entirely oriented towards growth.

I see no purpose in wasting further physical, financial or emotional energy on trying to avoid the inevitable. Given our situation and what I think is its root cause, I generally tell people who see the unfolding crisis and want to make changes in their lives simply to follow their hearts and their personal values.  I'm not exactly advising them to “Eat, drink and be merry”, though.  You might think of it more as, “Eat, drink and be mindful.”

Paul Chefurka

August 2013

Ottawa, Canada

Comments:

We struggle to explain why the conventional economic doctrine battles the realities of existential economic science; the first hypothesizes an infinite positive sum-game for human activity, while the latter goes begging to find a wider audience for its voice - that asserts a finite negative sum-game, dictated by the physical constraints and the laws of exponential mathematics. These two beliefs are deeply conflicting with one another because the first chooses to ignore the governing rules of the universe, whereas the other proposes integration with science, physics and mathematics, in order to set a better path for human activity.

So in our search for explanations we look to other writers, scholars, thinkers and activists for insights into why our collective actions and theories act in defiance of realities by endorsing infinite growth doctrines that are not only impossible to continue any longer, but they also push our species along an accelerated path destined for premature extinction.

As Paul Chefurka sets out in “Paradise Lost” maybe there is nothing to be done or anything else that can be said. Our internal wiring is so connected to the natural forces of the universe that it causes us to pursue and use more energy to serve our primary purposes of survival and procreation. Call it an inborn energy-seeking behavior. We are then just an integral natural part of the second law of thermodynamics serving to further and accelerate the causes of entropy in the whole universe. That being the case, conventional economic doctrines sadly wins the battle, as it is clearly aligned with entropic forces that invisibly shapes the destiny of humanity, the universe and eternity.

Hence in the last analysis, it is as certain as it gets - that we cannot defeat eternity, but that in itself should not dissuade us from seeking to optimize our entropic relationship with the universe in pursuit of a longer path. Too many things could happen along the way!     

.

T. A. McNeil

CEO and Founder

First Financial Insights

September 21, 2013

Links to Other Related

 Articles on this Site:

WHY ECONOMICS FAILS
http://firstfinancialinsights.blogspot.ca/2013/10/why-economics-fails.htmll

Infinity Express #Flight2100 - IMPORTANT PASSENGERS MESSAGE

http://firstfinancialinsights.blogspot.ca/2013/11/infinity-express-flight2100-important.html

Earth’s State of Population 
http://firstfinancialinsights.blogspot.ca/2013/10/earths-state-of-population.html

Humanity’s top priorities http://firstfinancialinsights.blogspot.ca/2013/10/humanitys-top-priorities.html

Visit Paul's Website - More Articles and Insights

www.paulchefurka.ca

CREDIT BUBBLE BIGGER THAN 2008

CREDIT BUBBLE BIGGER THAN 2008

(Read The Telegraph Article) 

How could credit circumstances be worse than 2008? Did we not learn from our mistakes? Was the system not fixed? Apparently not according to this former BIS, Bank of International Settlements veteran, things are 30% worse than they were back then. This is perhaps the most authoritative voice in the international markets, as prior to the 2008 meltdown it had forewarned of the need for policy-changes when all the rest were basking in the euphoria of those times. No one listened.

We too also began shifting client assets to cash and contrary assets classes back in August, 2007. Our analysis and conclusions, documented in our 2007 "Eye of the Storm" presentation to clients, presented troubling credit markets calling for, in our last analysis, "The Mother of All Credit Crunches." And that is exactly what occurred a bit more than a year after our report was filed with clients. So here we are again!   

The chart at the bottom shows a frightening 45% increase in leveraged loans with weaker borrowers  - and this rush to riskier credits should not be unexpected given the high profile sovereign credit problems throughout Europe over the past year. And add to it growing concerns about China's credit bubble,making lenders desperate for ways to make a buck. 

Where can lenders go? Certainly not Japan as its economic and credit system have been teetering for nearly two decades. The US? Look at this Federal Reserve chart below and it is apparent that the US economy has been financed by a major credit expansion since 2008.     

The world's top three economies are facing problematic symptoms associated with excessive credit expansion. The picture grows dimmer when the EU's recent troubles in Cyprus, Spain and Portugal are considered  Even Canada is looking dicey, as its Banks' liberal lending practises have sparked an overheated Condo boom, in the Toronto market. Many emerging nations are also experiencing the pains of the boom and bust credit cycle.

All this is putting tremendous pressure on long rates that Central Bankers are trying to talk down with rhetoric. Don't expect investors to buy into their sales pitches for much longer. The Fed, meanwhile, should continue with its tapering program for some time to keep US domestic rates in check, but that may not be much help for Europe, China. Japan, Canada and emerging markets. If rates do climb sharply elsewhere, no amount of Humpty-Dumpty tapering may be able to keep these financial flood waters from hitting US shores. Overbought equity markets could get trashed while gold bugs are redeemed for the time being, as markets seek safety.

Around the world we are seeing marginalized countries collapse under financial pressures caused by real physical issues associated with constraints of their populations over shooting the physical resource base of the country. Exponential mathematics then playing a hand in exacerbating their demise. Social and political unrest continues to grow and populate the international headlines. These troubles ultimately find their way back to developed nations as the deep global interconnections cannot be avoided - there is nowhere to run, nowhere to hide.

We have long said that classical economic theory is facing a day of reckoning with existential economic science; that the story of the theory's positive sum game contradicts existential science's negative sum game reality. Their collision will bring about a rock-bottom crash of unprecedented proportions to an abstract system . The fact that even Stephen Hawking included economic concerns, on his committee's end-game agenda, corroborates our position. More people see the writing on the wall.

From the above, we can only conclude that when the day of reckoning between classical and existential economics comes, its effects will be deep and widespread, globally. And again, there will be nowhere to run - and nowhere to hide.


First Financial Insights      
September 19, 2013

The Exponential Credit Trap???