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Image | The New Game-Changers for Gold & Silver
The New Game-Changers for Gold & Silver
 PREVIEW
by Adam Taggart

Executive Summary

  • Large players (and likely price manipulators) now have incentive for precious metals prices to rise
  • Investor demand for bullion remains at record highs
  • Competition for bullion from the East continues to heat up
  • Central banks buy more bullion as Comex inventories deplete
  • The key signs to know when it will be time to sell your gold & silver

If you have not yet read Part I: Is Gold at a Turning Point? available free to all readers, please click here to read it first.

Manipulation

Much has been written across the Web (including here at PeakProsperity.com) about whether or not the precious metals markets are manipulated in price by big players (major multi-national banks such as JP Morgan). Without delving into the many arguments on both the pro and con sides, Chris and I are of the opinion that sufficient data exists to convince a reasonable observer that price manipulation in the PM markets is indeed real, or, at the very least, highly probable. (For those remaining doubters out there, have a look at the evidence here, here, and here, and let us know if you have a rational, non-manipulative explanation.)

One of the most glaring signs of likely manipulation has been the massive short positions that a small number of large banks (JP Morgan being the most prominent among them) have held for many years, particularly in the silver market [measure positions as % of world silver production]. And not only were these unlimited positions allowed, but this cabal of banks was allowed to naked-sell PMs short (i.e., sell metal without actually owning it first). On the other side of the coin, the long side, position limits were enforced, and there was no similar ability to buy more metal than one could pay for. This imbalance of rules certainly provides the mechanism by which PM prices could be artificially jockeyed more easily to the downside. In this context, a decline from the high $40s to the low $20s looks more understandable.

Well, a very important part of this story has just shifted. The CFTC (Commodities Futures Trading Commission) publishes a monthly report illustrating the positions taken in Comex Futures Contracts

After nearly ten years of being net short in Comex gold futures, U.S. banks have been recently decreasing those short positions, and – for the first time since 2004 (with the exception of a single month in 2008) – they have flipped to become net long gold in May (see bottom chart below)…

The New Game-Changers for Gold & Silver
 PREVIEW by Adam Taggart

Executive Summary

  • Large players (and likely price manipulators) now have incentive for precious metals prices to rise
  • Investor demand for bullion remains at record highs
  • Competition for bullion from the East continues to heat up
  • Central banks buy more bullion as Comex inventories deplete
  • The key signs to know when it will be time to sell your gold & silver

If you have not yet read Part I: Is Gold at a Turning Point? available free to all readers, please click here to read it first.

Manipulation

Much has been written across the Web (including here at PeakProsperity.com) about whether or not the precious metals markets are manipulated in price by big players (major multi-national banks such as JP Morgan). Without delving into the many arguments on both the pro and con sides, Chris and I are of the opinion that sufficient data exists to convince a reasonable observer that price manipulation in the PM markets is indeed real, or, at the very least, highly probable. (For those remaining doubters out there, have a look at the evidence here, here, and here, and let us know if you have a rational, non-manipulative explanation.)

One of the most glaring signs of likely manipulation has been the massive short positions that a small number of large banks (JP Morgan being the most prominent among them) have held for many years, particularly in the silver market [measure positions as % of world silver production]. And not only were these unlimited positions allowed, but this cabal of banks was allowed to naked-sell PMs short (i.e., sell metal without actually owning it first). On the other side of the coin, the long side, position limits were enforced, and there was no similar ability to buy more metal than one could pay for. This imbalance of rules certainly provides the mechanism by which PM prices could be artificially jockeyed more easily to the downside. In this context, a decline from the high $40s to the low $20s looks more understandable.

Well, a very important part of this story has just shifted. The CFTC (Commodities Futures Trading Commission) publishes a monthly report illustrating the positions taken in Comex Futures Contracts

After nearly ten years of being net short in Comex gold futures, U.S. banks have been recently decreasing those short positions, and – for the first time since 2004 (with the exception of a single month in 2008) – they have flipped to become net long gold in May (see bottom chart below)…

Image | And the Smart Money Is Already Withdrawing
And the Smart Money Is Already Withdrawing
 PREVIEW
by Chris Martenson

Executive Summary

  • The data shows first-time home buyers already beginning to throw in the towel
  • But house "flipping" by amateur investors is coming back into vogue
  • Why we're back in a housing bubble
  • Big funds are beginning to exit retail housing due to too much "stupid money"
  • The risks every home buyer (and homeowner) needs to be aware of right now

If you have not yet read Part I: Housing Prices are Being Dangerously Distorted by Big Institutional Money available free to all readers, please click here to read it first.

The Impacts

As noted in the Salt Lake City anecdote above, one obvious impact of all this institutional money is that it is preventing ordinary people from buying a home because they cannot compete with the big money firms:

Blackstone, other investors snap up thousands of Tampa Bay rental homes

Ken and Susan Beran embodied that old idea of the American dream. They married. Built a house. Raised a daughter within its walls. But after 30 years, as Ken eyed retirement, the Berans envisioned a different dream.

In December, they moved to a new home — this time, to rent. Ken said he can't imagine ever buying a home again. Susan, a first-grade teacher, hasn't felt so calm in years. "I'm leaving a building I had to maintain, had to stress over," Susan said. "I'm taking all of my memories with me."

Bad credit, ravaged savings and evolving attitudes are driving more Americans to rent houses, and big-money investors are waging war to win their business. Few are mightier than the Blackstone Group, which dropped $150 million to buy 1,000 Tampa Bay homes — in just the last six months.

The New York-based private equity giant has already bet $3.5 billion across the country that the housing crisis has fundamentally changed the way many families live. Once-proud homeowners like the Berans, they believe, are beginning to reject home ownership altogether.

It seems entirely wrong to me that the Fed bailed out big banks and made money excessively cheap for institutions, and that this is being used to price ordinary people out of the housing market.  Said another way, the Fed prints fake money out of thin air and some companies use that same money to buy real things like houses and then rent them out to real people trying to live real lives.

Recently it was shown that the number of first-time homebuyers has fallen by 25% as these typically low-end buyers have retreated in the face of higher prices. 

Not exactly the sort of 'spin' you usually read on that story, but it's more honest than trying to claim that the recent price hikes are due to improving consumer confidence and an economic recovery…

And the Smart Money Is Already Withdrawing
 PREVIEW by Chris Martenson

Executive Summary

  • The data shows first-time home buyers already beginning to throw in the towel
  • But house "flipping" by amateur investors is coming back into vogue
  • Why we're back in a housing bubble
  • Big funds are beginning to exit retail housing due to too much "stupid money"
  • The risks every home buyer (and homeowner) needs to be aware of right now

If you have not yet read Part I: Housing Prices are Being Dangerously Distorted by Big Institutional Money available free to all readers, please click here to read it first.

The Impacts

As noted in the Salt Lake City anecdote above, one obvious impact of all this institutional money is that it is preventing ordinary people from buying a home because they cannot compete with the big money firms:

Blackstone, other investors snap up thousands of Tampa Bay rental homes

Ken and Susan Beran embodied that old idea of the American dream. They married. Built a house. Raised a daughter within its walls. But after 30 years, as Ken eyed retirement, the Berans envisioned a different dream.

In December, they moved to a new home — this time, to rent. Ken said he can't imagine ever buying a home again. Susan, a first-grade teacher, hasn't felt so calm in years. "I'm leaving a building I had to maintain, had to stress over," Susan said. "I'm taking all of my memories with me."

Bad credit, ravaged savings and evolving attitudes are driving more Americans to rent houses, and big-money investors are waging war to win their business. Few are mightier than the Blackstone Group, which dropped $150 million to buy 1,000 Tampa Bay homes — in just the last six months.

The New York-based private equity giant has already bet $3.5 billion across the country that the housing crisis has fundamentally changed the way many families live. Once-proud homeowners like the Berans, they believe, are beginning to reject home ownership altogether.

It seems entirely wrong to me that the Fed bailed out big banks and made money excessively cheap for institutions, and that this is being used to price ordinary people out of the housing market.  Said another way, the Fed prints fake money out of thin air and some companies use that same money to buy real things like houses and then rent them out to real people trying to live real lives.

Recently it was shown that the number of first-time homebuyers has fallen by 25% as these typically low-end buyers have retreated in the face of higher prices. 

Not exactly the sort of 'spin' you usually read on that story, but it's more honest than trying to claim that the recent price hikes are due to improving consumer confidence and an economic recovery…

Image | A Clear Picture of What to Expect
A Clear Picture of What to Expect
 PREVIEW
by JHK

Executive Summary

  • Dmitry Orlov's recent work shows how sovereign collapse progresses along a well understood trajectory
  • Understanding the elements & ramifications of each stage is critical to positioning oneself safely in advance
  • The five stages: financial, commercial, political, social & cultural
  • The U.S. looks certain to follow this progression – at least partway – in our lifetimes, likely sooner than later. The decisions you make and actions you take now will have outsized repercussions for your future.

If you have not yet read Part I: America the Vulnerable, available free to all readers, please click here to read it first.

Orlov’s Reinventing Collapse: The Soviet Experience and American Prospects was a tour de force of political writing with true literary panache. It announced the arrival on the scene of a major thinker – in a period of history that didn’t care much about thinkers (unless they could invent cell-phone apps). After that first book, he published some books of assorted essays, and now he's out with another major statement titled The Five Stages of Collapse: Survivors' Toolkit (New Society Publishers).  

This new book assumes that global industrial civilization is on a collapse trajectory, and Orlov doesn’t waste any ink on arguments trying to prove that. Rather, he lays out in detail exactly how the process of civilizational collapse may actually happen. For many readers and observers, the prospect is often conceived in narratives of Hollywood-style apocalyptic melodrama with some kind of sudden chaos driving the story. Orlov avoids that tripe and instead presents a clear declension of proceedings that unfold naturally and comprehensibly in a certain order – like the progressive organ failure that doctors encounter in the intensive care unit. 

Orlov calls his method “a taxonomy of collapse.” The point of the book, he writes, is “(n)ot whether collapse will occur, but rather what it looks like, what to expect, and how we should behave should we wish to survive.”

The Five Stages of Collapse

As he conceives it, the five stages would tend to play out in sequence based on the breaching of particular boundaries of consensual faith and trust that groups of human beings vest in the institutions and systems they depend on for daily life. These boundaries run from the least personal (e.g. trust in banks and governments) to the most personal (faith in your local community, neighbors, and kin)…

A Clear Picture of What to Expect
 PREVIEW by JHK

Executive Summary

  • Dmitry Orlov's recent work shows how sovereign collapse progresses along a well understood trajectory
  • Understanding the elements & ramifications of each stage is critical to positioning oneself safely in advance
  • The five stages: financial, commercial, political, social & cultural
  • The U.S. looks certain to follow this progression – at least partway – in our lifetimes, likely sooner than later. The decisions you make and actions you take now will have outsized repercussions for your future.

If you have not yet read Part I: America the Vulnerable, available free to all readers, please click here to read it first.

Orlov’s Reinventing Collapse: The Soviet Experience and American Prospects was a tour de force of political writing with true literary panache. It announced the arrival on the scene of a major thinker – in a period of history that didn’t care much about thinkers (unless they could invent cell-phone apps). After that first book, he published some books of assorted essays, and now he's out with another major statement titled The Five Stages of Collapse: Survivors' Toolkit (New Society Publishers).  

This new book assumes that global industrial civilization is on a collapse trajectory, and Orlov doesn’t waste any ink on arguments trying to prove that. Rather, he lays out in detail exactly how the process of civilizational collapse may actually happen. For many readers and observers, the prospect is often conceived in narratives of Hollywood-style apocalyptic melodrama with some kind of sudden chaos driving the story. Orlov avoids that tripe and instead presents a clear declension of proceedings that unfold naturally and comprehensibly in a certain order – like the progressive organ failure that doctors encounter in the intensive care unit. 

Orlov calls his method “a taxonomy of collapse.” The point of the book, he writes, is “(n)ot whether collapse will occur, but rather what it looks like, what to expect, and how we should behave should we wish to survive.”

The Five Stages of Collapse

As he conceives it, the five stages would tend to play out in sequence based on the breaching of particular boundaries of consensual faith and trust that groups of human beings vest in the institutions and systems they depend on for daily life. These boundaries run from the least personal (e.g. trust in banks and governments) to the most personal (faith in your local community, neighbors, and kin)…

Image | Protect Your Wealth in Advance of the Bubble’s Bursting
Protect Your Wealth in Advance of the Bubble’s Bursting
 PREVIEW
by Chris Martenson

Executive Summary

  • Corporate junk bonds: All-time highs
  • Equities: All-time highs in Germany and U.S.
  • Other equities: Spiking upwards (Japan, Greece, Australia)
  • Margin Debt: Second highest on record
  • Excuses: Consistent with bubble territory
  • Timing: When reality will likely express itself

If you have not yet read Part I:  Four Signs That We're Back in Dangerous Bubble Territory, available free to all readers, please click here to read it first.

In Part I, we discussed four signs that we are in bubble territory – in both stocks and bonds – plus all of the usual rationalizations that accompany bubbles. In truth, there are many more signs which we'll discuss further here, and I want to go deeper into the data exploring the warning signs in the equity and bond markets.

I want to spend time cataloging and explaining my reasoning because when bubbles burst, it's traumatic for everyone, but especially those that aren't prepared.

Further, these bubbles are so large that it's useful to employ historical analogues to weigh them against and parse for clues as to just how bad developments could get.

The Big Picture

What we do at Peak Prosperity is track the big picture. We look at the macro risks and trends, and try to figure out what's coming next. Over the long haul. we have very little doubt that several decades of debt accumulation partnered with structurally higher oil prices will result in anything other than reduced standards of living for most people.

And that’s if everything goes smoothly.

At the other end of the spectrum lies the potential for currency, political, and fiscal crises, the likes of which have never been seen before, given the global nature of the situation.

Leaving oil prices aside for the moment, in purely economic terms, living beyond one’s means now necessitates living below one’s means later on. Whether that period of negative adjustment is the same length and depth, shorter and deeper, or longer and shallower is open to question. But I'm leaning towards ‘shorter and deeper’ because history shows that bubbles tend to burst more rapidly than they form.

That is, we could view this as a bubble in financial assets, particularly credit (debt), but we could just as easily view it as a bubble in living standards. We overdid things and now it's just a question of figuring out who is going to eat the losses. Historically, that answer has always been 'the little people,' but today we have dropped such disparaging terms in favor of the more politically palatable 'taxpayers.'

To understand the current predicament, the most important chart to look at is the ratio of total national debt to GDP (debt-to-income)…

Protect Your Wealth in Advance of the Bubble’s Bursting
 PREVIEW by Chris Martenson

Executive Summary

  • Corporate junk bonds: All-time highs
  • Equities: All-time highs in Germany and U.S.
  • Other equities: Spiking upwards (Japan, Greece, Australia)
  • Margin Debt: Second highest on record
  • Excuses: Consistent with bubble territory
  • Timing: When reality will likely express itself

If you have not yet read Part I:  Four Signs That We're Back in Dangerous Bubble Territory, available free to all readers, please click here to read it first.

In Part I, we discussed four signs that we are in bubble territory – in both stocks and bonds – plus all of the usual rationalizations that accompany bubbles. In truth, there are many more signs which we'll discuss further here, and I want to go deeper into the data exploring the warning signs in the equity and bond markets.

I want to spend time cataloging and explaining my reasoning because when bubbles burst, it's traumatic for everyone, but especially those that aren't prepared.

Further, these bubbles are so large that it's useful to employ historical analogues to weigh them against and parse for clues as to just how bad developments could get.

The Big Picture

What we do at Peak Prosperity is track the big picture. We look at the macro risks and trends, and try to figure out what's coming next. Over the long haul. we have very little doubt that several decades of debt accumulation partnered with structurally higher oil prices will result in anything other than reduced standards of living for most people.

And that’s if everything goes smoothly.

At the other end of the spectrum lies the potential for currency, political, and fiscal crises, the likes of which have never been seen before, given the global nature of the situation.

Leaving oil prices aside for the moment, in purely economic terms, living beyond one’s means now necessitates living below one’s means later on. Whether that period of negative adjustment is the same length and depth, shorter and deeper, or longer and shallower is open to question. But I'm leaning towards ‘shorter and deeper’ because history shows that bubbles tend to burst more rapidly than they form.

That is, we could view this as a bubble in financial assets, particularly credit (debt), but we could just as easily view it as a bubble in living standards. We overdid things and now it's just a question of figuring out who is going to eat the losses. Historically, that answer has always been 'the little people,' but today we have dropped such disparaging terms in favor of the more politically palatable 'taxpayers.'

To understand the current predicament, the most important chart to look at is the ratio of total national debt to GDP (debt-to-income)…

Image | Utah Leading The Way
Utah Leading The Way
 PREVIEW
by Chris Martenson

I have an important update from Utah, where Adam and I have been for the past couple of days.  For years we have been pushing the basic message that we are on an unsustainable path.  And by “we” I mean folks in the US, Europe, Japan and pretty much everywhere on the globe.  And the…
Utah Leading The Way
 PREVIEW by Chris Martenson

I have an important update from Utah, where Adam and I have been for the past couple of days.  For years we have been pushing the basic message that we are on an unsustainable path.  And by “we” I mean folks in the US, Europe, Japan and pretty much everywhere on the globe.  And the…
Image | Utah Is Setting an Important Example
Utah Is Setting an Important Example
 PREVIEW
by Chris Martenson

Since I started delivering this message, I've held a vision of the day when it instead elicits knowing nods because its truths have become self-evident. My proudest day will be when there's no more need to communicate the core ideas in the Crash Course because they'll already be common knowledge.

I cannot wait for the day when, literally, I'll have talked myself out of a job.

Well, we're one very important step closer to that day.

Utah Is Setting an Important Example
 PREVIEW by Chris Martenson

Since I started delivering this message, I've held a vision of the day when it instead elicits knowing nods because its truths have become self-evident. My proudest day will be when there's no more need to communicate the core ideas in the Crash Course because they'll already be common knowledge.

I cannot wait for the day when, literally, I'll have talked myself out of a job.

Well, we're one very important step closer to that day.

Image | Why This Recovery Is Coming to an End
Why This Recovery Is Coming to an End
 PREVIEW
by Gregor Macdonald

Executive Summary

  • Fertility rates are experiencing a "natural decrease" at record levels across the U.S.
  • Poverty rates are rising across the country, despite the "recovering" economy
  • What exactly is "powering" U.S. economic growth? Perhaps much less than realized.
  • Why we are likely in the calm before the storm when corporate profits peak right before an economic downturn
  • The 3 most likely scenarios for the stock market from here

If you have not yet read Part I: Marking the 4-Year Reflationary Rally: How Much Better Off Are We Really?, available free to all readers, please click here to read it first.

One of the challenges the U.S. stock market will increasingly face in the years ahead is continued growth in the Dependency Ratio. The U.S. Census Bureau alerted us to this trend back in 2010. For keen observers of demographics, this couldn’t have been a surprise). The rate at which the Dependency Ratio is growing, and is set to grow further, is accelerating:

The U.S. Census Bureau reported today that the dependency ratio, or the number of people 65 and older to every 100 people of traditional working ages, is projected to climb rapidly from 22 in 2010 to 35 in 2030. This time period coincides with the time when baby boomers are moving into the 65 and older age category…The expected steep rise in the dependency ratio over the next two decades reflects the projected proportion of people 65 and older climbing from 13 percent to 19 percent of the total population over the period, with the percentage in the 20 to 64 age range falling from 60 percent to 55 percent…“This rapid growth of the older population may present challenges in the next two decades,” said Victoria Velkoff, assistant chief for estimates and projections for the Census Bureau's Population Division. “It's also noteworthy that those 85 and older — who often require additional caregiving and support — would increase from about 14 percent of the older population today to 21 percent in 2050.”

This is precisely one of the key, ongoing headwinds that faced Japan's stock market for 20 years. When Japan's economy moved steadily into its low-growth phase, unable to generate sufficient jobs, fertility rates and household formation declined rapidly. As I explained in The Arrival of Japan's Sunset, these will not be cured by the current devaluation of the yen, despite naïve cheerleading. And neither will they be solved here in the U.S.

But in contrast to Japan, the United States is only just embarking on its slow growth phase. Its demographically challenged culture and economy will reinforce each other as we move ahead in time. And, it's not just the retiring class of workers that will massively increase the Dependency Ratio in the U.S. in years ahead…

Why This Recovery Is Coming to an End
 PREVIEW by Gregor Macdonald

Executive Summary

  • Fertility rates are experiencing a "natural decrease" at record levels across the U.S.
  • Poverty rates are rising across the country, despite the "recovering" economy
  • What exactly is "powering" U.S. economic growth? Perhaps much less than realized.
  • Why we are likely in the calm before the storm when corporate profits peak right before an economic downturn
  • The 3 most likely scenarios for the stock market from here

If you have not yet read Part I: Marking the 4-Year Reflationary Rally: How Much Better Off Are We Really?, available free to all readers, please click here to read it first.

One of the challenges the U.S. stock market will increasingly face in the years ahead is continued growth in the Dependency Ratio. The U.S. Census Bureau alerted us to this trend back in 2010. For keen observers of demographics, this couldn’t have been a surprise). The rate at which the Dependency Ratio is growing, and is set to grow further, is accelerating:

The U.S. Census Bureau reported today that the dependency ratio, or the number of people 65 and older to every 100 people of traditional working ages, is projected to climb rapidly from 22 in 2010 to 35 in 2030. This time period coincides with the time when baby boomers are moving into the 65 and older age category…The expected steep rise in the dependency ratio over the next two decades reflects the projected proportion of people 65 and older climbing from 13 percent to 19 percent of the total population over the period, with the percentage in the 20 to 64 age range falling from 60 percent to 55 percent…“This rapid growth of the older population may present challenges in the next two decades,” said Victoria Velkoff, assistant chief for estimates and projections for the Census Bureau's Population Division. “It's also noteworthy that those 85 and older — who often require additional caregiving and support — would increase from about 14 percent of the older population today to 21 percent in 2050.”

This is precisely one of the key, ongoing headwinds that faced Japan's stock market for 20 years. When Japan's economy moved steadily into its low-growth phase, unable to generate sufficient jobs, fertility rates and household formation declined rapidly. As I explained in The Arrival of Japan's Sunset, these will not be cured by the current devaluation of the yen, despite naïve cheerleading. And neither will they be solved here in the U.S.

But in contrast to Japan, the United States is only just embarking on its slow growth phase. Its demographically challenged culture and economy will reinforce each other as we move ahead in time. And, it's not just the retiring class of workers that will massively increase the Dependency Ratio in the U.S. in years ahead…

Image | A Technical Analysis of Where the Gold Price is Likely to Go Next
A Technical Analysis of Where the Gold Price is Likely to Go Next
 PREVIEW
by charleshughsmith

Executive Summary

  • Sentiment measurement is proving to be an unreliable indicator
  • Classic technical analysis is inconclusive but hints there is still weakness that needs to be flushed from the system
  • The current era is feeling like 2007/2008 – gold could rebound strongly this year if enough weak economic data makes it out into the public
  • The factors to look for that will indicate a price reversal is imminent

If you have not yet read Part I: Charting Gold, available free to all readers, please click here to read it first.

A Technical Analysis of Where the Gold Price is Likely to Go Next
 PREVIEW by charleshughsmith

Executive Summary

  • Sentiment measurement is proving to be an unreliable indicator
  • Classic technical analysis is inconclusive but hints there is still weakness that needs to be flushed from the system
  • The current era is feeling like 2007/2008 – gold could rebound strongly this year if enough weak economic data makes it out into the public
  • The factors to look for that will indicate a price reversal is imminent

If you have not yet read Part I: Charting Gold, available free to all readers, please click here to read it first.

Image | AP Twitter Hack Reveals Just How Broken Our Markets Really Are
AP Twitter Hack Reveals Just How Broken Our Markets Really Are
 PREVIEW
by Chris Martenson

Two themes that we've been consistently stressing over the past several years were beautifully illustrated today, courtesy of a hacked AP Twitter feed.

They are:

  • Our markets are broken (courtesy of High Frequency Trading, or HFT, computers), and
  • When things finally shift, they will do so at a speed that will shock us.

But first, the hacked AP Twitter feed…
AP Twitter Hack Reveals Just How Broken Our Markets Really Are
 PREVIEW by Chris Martenson

Two themes that we've been consistently stressing over the past several years were beautifully illustrated today, courtesy of a hacked AP Twitter feed.

They are:

  • Our markets are broken (courtesy of High Frequency Trading, or HFT, computers), and
  • When things finally shift, they will do so at a speed that will shock us.

But first, the hacked AP Twitter feed…
Image | Fixing the Mess We’ve Made
Fixing the Mess We’ve Made
 PREVIEW
by JHK

Executive Summary

  • The prevailing trends of the next several decades: contraction, down-scaling & re-localization
  • How these trends will manifest in commerce, politics, employment & infrastructure
  • Those who adapt now will be positioned to thrive
  • Act now – ask forgiveness, not permission

If you have not yet read Part I: We've Dug a Pretty Damn Big Hole for Ourselves, available free to all readers, please click here to read it first.

We may never again restore trust in giant institutions ranging from the U.S. government to Harvard University to The New York Times. They have probably squandered their credibility and their legitimacy.

Anyway, the trends now moving human affairs are taking us away from both gigantism and the growth imperative that these things represent. The trends of the present moment in history are contraction, down-scaling, and re-localization.

Managing contraction is the only safe reality-based political response to the situation, and there is no constituency for it – though contraction is emphatically underway whether we like it or not, and it would be advantageous if we could manage our way through it rather than let it become a disorderly rout in which people starve and the rule of law disintegrates altogether.

As for re-localization and downscaling, there is a highly visible, easily identifiable constituency…

Fixing the Mess We’ve Made
 PREVIEW by JHK

Executive Summary

  • The prevailing trends of the next several decades: contraction, down-scaling & re-localization
  • How these trends will manifest in commerce, politics, employment & infrastructure
  • Those who adapt now will be positioned to thrive
  • Act now – ask forgiveness, not permission

If you have not yet read Part I: We've Dug a Pretty Damn Big Hole for Ourselves, available free to all readers, please click here to read it first.

We may never again restore trust in giant institutions ranging from the U.S. government to Harvard University to The New York Times. They have probably squandered their credibility and their legitimacy.

Anyway, the trends now moving human affairs are taking us away from both gigantism and the growth imperative that these things represent. The trends of the present moment in history are contraction, down-scaling, and re-localization.

Managing contraction is the only safe reality-based political response to the situation, and there is no constituency for it – though contraction is emphatically underway whether we like it or not, and it would be advantageous if we could manage our way through it rather than let it become a disorderly rout in which people starve and the rule of law disintegrates altogether.

As for re-localization and downscaling, there is a highly visible, easily identifiable constituency…

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I’ve been doing a lot of thinking about the needs and sustainability of our family. We have six young children, our oldest just turned 12 and our youngest just turned 3 months old. I love the considerations that the article had above and thought I would add a few things that I have considered for our situation. My...
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