TEOTWAWKI: otherwise known as – The End Of The World As We Know It
Pretty much as long as there has been a world there have been Doom Merchants wailing that’s its all going to end, and the worlds going to hell-in-a-hand-basket, etc.
Well, in the grand scheme of things, sooner or later yes the world will have to end. But on the evidence to date I think we can safely assume that it wont be anytime soon.
So, much as some people love to make dire predictions and be pessimistic, the world is actually going to keep turning.
On the other hand, we do also have to keep in mind that history is written by the survivors. There are actually plenty of people throughout history that have come to a very sticky end. The dead tend to get buried and forgotten though.
So it is all very much a question of perspective really.
Is the world going to come to an end? Practically – no.
Well, that’s a rather more difficult question to answer. Because this is where TEOTWAWKI comes in. This is about the world “as we know it”. Even then that still leaves a very big and open field with which to work. For the people of Hiroshima, the world did end in a big hurry one day in 1945, but Japan continued. Then again, things were never the same for Japan after that in so many ways either (arguably the rest of the world changed on that day as well). History is full of seminal moments where an event changed forever the way of life of a people, or simply ended their lives.
Yes humanity endures and recovers, but lets not forget those that don’t, or the suffering that so many have gone through. The Depression of the 1930’s segued into the wars of the 1940’s. That was definitely the end of the world as a lot of people knew it. Arguably, the First World War was an even greater turning point that essentially ended the way of life of the Ancien Régime’s.
Are we at such an historical turning point now? My instincts and observations are screaming yes, but pretty much nobody else believes it. In a nutshell, no-one believes.
Yes, the economy is a bit rocky, there are rumblings about debt problems and we have heard about people getting laid off, etc, etc. But realistically, no-one actually thinks that we have tipped over a precipice and the world as we know it is disintegrating around as we speak. There is a good saying that it is only a depression if you don’t have a job. Currently in NZ the unemployment rate is officially around the 5% mark, in the United States and elsewhere it is much higher, 10% and above, but nowhere apparently is it high enough that the general population is alarmed to the point of activism.
The shopping malls are still open, there is food in the supermarkets, the ATM’s still work and TV, that modern opiate of the masses, is still crooning its soothing lullaby.
Why should they? We survived Y2K, We survived 9/11, we survived the Tech Market Crash, and frankly we have survived the 2009 Crash as well. If we are in something of a recession at the moment, then what’s new about that? We have been in and out of recessions for decades. The economy always comes back bigger and stronger each time. There really isn’t any sort of objective proof that anything is different this time. Yes, the economists can talk about financial loses in the millions, billions and trillions, but that is all just funny money, it doesn’t bear any relation to real life. If some bankers on Wall Street have gone bust at their casino, what relevance is that to Main Street?
Frankly, the only thing that happened recently that did send a shiver down people’s spines was the cost of oil climbing up to around $140 a barrel. That genuinely did put a serious crimp in people’s lifestyles. But there again, another temporary fluctuation that just went away.
Nothing anybody can say is going to change people’s minds about the state of their world. People are optimistic that a year from now things will be better. I know, I have talked to my friends and acquaintances about exactly this and they all talk about things with the expectation that they will continue on exactly as they are now.
If there is a slim segment of the population that is alarmed by the portents and signs, then they are a very slim minority indeed. I like to characterise it per that old saying – Thinking is the hardest thing to do in the world, that’s why so few people do it. But on the other hand, if all I do is read the writings of other Doom Merchants and I have a depressive trait running through my family, I might not totally be the best judge of things. Maybe.
I might just be a pessimist.
Of course that could be like the situation with paranoids, just because you are paranoid, that doesn’t mean there isn’t actually some-one out to get you, haha.
Time will tell I guess. On the other hand, given enough time I will be dead anyway and it isn’t going to matter to me anymore, by then it will be some-one else’s problem… and so the world turns.
In the meantime, and assuming I have seen the truth of it all and am not just tied up in my own little apocalyptic fantasy… Seeing how this is the start of a new year and a new (sic)decade, lets have a look at some possibilities as I see them that would make for a very Unhappy new year.
1.) The price of oil climbs back over $100 a barrel – possible, but I really don’t know enough about oil markets and oil market manipulations to hazard a guess as to what is going to happen there. Price doesn’t necessarily bear any sort of relation to the fundamentals. Although on the fundamentals, Peak Oil is looking like biting down hard from now on and that is serious on so many levels.
2.) Peak Credit – Inspite of all the best efforts of central banks, credit is not going to be as free and easy again. Interest rates must inevitably climb sharply and again this is a situation that has impacts on so many levels.
3.) Housing price collapse – the rest of the world has been hit hard by this, but so far NZ seems to have escaped. Not for too much longer I’m guessing. Imagine what the impact of a 30, 40 or 50% decline in the value of your home, on all homes, would mean. How many people would be feeling very poor, or worse would now owe more money on their home than it was worth? How many would that bankrupt? How many mortgages would foreclose? Why would anyone buy into a falling market?
4.) Stockmarket crash – ultimately the stockmarket must be based on earnings. No earnings means no stockmarket. The American Dow Jones industrial average plunged 50% last year and then recovered half of that fall in pretty much the fastest recovery ever. But the fundamentals of employment, production, debt and sales never turned around and continue to fall. Apart from the torrents of government money printing and borrowing being funnelled into financial institutions, what else is holding up stockmarkets? Sooner or later the markets are going to have to find an equilibrium based on something real. For the last month they have just moved sideways. A break in some direction is getting set up here, I am guessing down. Even if trying to time the market is a fools game, the consensus is now betting on a further crash. Where the US leads, NZ will follow.
5.) Unemployment – what is there to hold up employment in NZ? We have no industry to speak of. Most of our economy is build around food exports, tourism or government spending. Where are our export industries headed? I wouldn’t even want to try to guess, but if our major trading partners move even deeper into recession, you wouldn’t think that would be too good for us. Anecdotally, I have heard that tourist numbers are down as much as 50%. Ouch. That’s one of our biggest sectors for employment. Without a big turn around in a hurry, layoffs from there must continue to climb. Who’s betting on a big turn around any time soon? What if the numbers fall further? Then there is the government, but they are already borrowing $250 million a week to pay their bills. Tax receipts have cratered. With the best will in the world you cannot pay people with money you do not have. Increasingly government is going to have to look at cutting people. How can they not? Ohh, and one last factor. The building industry and related retail sectors are suffering and in real danger of further contraction. What is there to make anyone think that the bottom is in? What is there to stop further layoffs here either. Consider the question seriously, what is there to stop unemployment climbing to 10% or more?
6.) Deflation/inflation – Does it matter which is happening or ends up happening? Either will hurt us badly. Of the things that caused the crash last year, none of them have gone away or been solved. All that has happened is that we have papered over the cracks with a wall of money that has been borrowed or printed into existence. If that was all that was necessary to solve the problems of the world then we would never have had any problems. I suggest that Zimbabwe and the Weimar Republic would argue that approach is not going to work. You cannot solve a problem of debt with more debt. Something has to break somewhere.
So where are the breaks going to come from this year? Can we muddle on through and continue on more or less as we always have? Or is The-World-As-We-Know-It going to crash down around us?
Place your bets everyone. Or more to the point, don’t worry, think, or care about any of this and just continue on per usual. Nothing to see here.
As far as I can see, pretty much no-one is unduly concerned. There are grumblings, but no-one else is panicking. I am yelling panic.
If there was belief, then there could be changes and action taken. Without belief then nothing changes.
Am I the prophet or the fool?
Are we accelerating towards Depression and War – or – will everything still be much the same another year from now?
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