Usually when people talk about making money in the stock market they don´t think about how to generate passive income, instead they think about capital gains. However, today I want...
Welcome to exponential growth
I want you to see this video made by Chris Martenson, former Vice president of a fortune 300 company. What he is talking about in the video is from an American point of view but applies for most countries in the world today.
He talks about the three E´s, The Economy, the Environment and Energy. The three things that really makes the world go around. He explains exponential growth in a very simple and good way. Exponential growth is simply put, something that grows by some percentage over time.
The economy is an example of something that is built to grow exponentially, there has to be growth for the economy to function. What many experts are seeing now is that it might not be possible for the economy to grow every year all the time for all eternity because the growth is dependent a number of factors, one of them being energy.
If we take Chris´s word that 95% of everything from production and transportation has some kind of oil usage involved in it we can come to the conclusion that the economy at this stage can´t work without oil. So if the economy have to grow by some percentage every year we can also see that oil production has to grow every year. For this to be possible there have to be new oil findings every year, or the oil companies have to come up with a way to pump up more oil from the existing wells. So now the question is, is it possible?
Well, until now it has been possible but of course there is no chance for this to go on forever, the earth’s resources are limited.
We are not talking about when we will be out of oil here, only when the demand increase for oil will outgrow the rate of production increase.
There is also one very important point made in the video and that is the cost of oil. How much it cost to produce the oil from the new oil findings, not the cost of Dollars or any other currency but how much energy does it take to produce the oil. When Chris talks about “the time of cheap oil has past” you might think “but oil is falling in price right now”.
The fact is that I doesn´t really matter what the price is in any currency, what matters is how much energy can I get from the energy that I put in, this is called “Net energy”.
If an oil company makes a huge oil discovery at the ocean floor and it takes 1 barrel of oil to pump up 10 barrels of oil it might be good. If it instead takes 1 barrel to pump up 1 barrel then there is no point of pumping it up ever since they would lose money for every barrel they pump up, no matter how big the finding is.
According To Chris´s data, the time where the oil companies can´t find new oil at a high enough rate is here. This would mean that in the coming years, the economy will not be able to grow anymore because there isn´t enough natural resources for the growth to sustain.
This is another very important point made. Because of the economies demand for constant growth the environment has to suffer and at some point down the road this will kill us all. That seems like a really harsh statement, doesn´t it?
Let me explain my view on this. If we don’t do anything about this, there will be no more fish in the sea, no more trees in the forest, no more clean water and too polluted air to breath.
This Year on the 13th of August was ”earth overshoot day”. For the rest of the year, we will maintain our ecological deficit by drawing down local resource stocks and accumulating carbon dioxide in the atmosphere. We will be operating in overshoot.
Just as a bank statement tracks income against expenditures, Global Footprint Network measures humanity’s demand for and supply of natural resources and ecological services. And the data is sobering. Global Footprint Network estimates that approximately every eight months, we demand more renewable resources and C02 sequestration than what the planet can provide for an entire year. In 2014 the date of “earth overshoot day” was the 19th of August. More about this on the Overshootday website.
If we continue to spend the earths resources at this pace and do nothing to let it regenerate, soon there will be no resources to take from.
So what can we do personally?
For me there were many questions around this.
How long time will it take before we will see the problems clearly?
The thing here it that we already do. I think that most people already know that we are over consuming things, that the world economy is in bad shape and that the climate is changing due to pollution. The real question is – When do we really need to get of our fat asses and start doing something about it?
And the answer is NOW!
We need to start doing things now, things that make us less reliant on energy, things that make us less reliant on the governments to solve things and things that help us protect our wealth.
I´m talking about changing to low energy lights and products, not because you need to save a couple of Euros today but because there will be problems in energy supply somewhere down the road.
Stay in shape, we all se problems in the healthcare systems today and it will not get better with growing populations and less nurses and doctors (or more expensive healthcare). To exercise is a very cheap insurance for your health, a fit body runs far less risk of becoming sick than a totally untrained one.
Maybe looking at solutions of making your family less reliant on oil and electricity. Maybe get some good bicycles? Can you put solar panels on your property? Can you grow some of your food at home? Can you put up a wind power turbine? Can you extra isolate on your house? Can you put up a water collecting system on the roof?
All these things will benefit you today and will make you less vulnerable when or even if the time comes, when you really need it. It´s better to be prepared for problems and never see them come than to have problems come and not be prepared.
When it comes to wealth protection there are some things to do and I will write about what I´m personally doing in the coming weeks.
Please help to get this message spread, It´s very important that as many people as possible can get this information and make their own decisions about what to do about it. Click the share buttons on all the social media networks that you use.
Passive income together