Register

Peak Oil is You


Donate Bitcoins ;-) or Paypal :-)


Page added on January 19, 2020

Bookmark and Share

Welcome to ‘Peak Decade,’ From Globalization to Central Banks

Consumption

.

Amid the Alpine peaks of the Swiss resort of Davos in the week ahead, politicians, investors and executives will be busy debating whether we are witnessing peaks in key drivers of the world economy.

From oil demand, car production and the proportion of young people as a share of the population, to less-measurable themes like globalization, inequality and central banking power, there’s an argument each will ebb in the 2020’s.

Strategists at Bank of America Corp. are already telling clients to brace for a “ground-breaking ‘peak decade’” that will disrupt business and investing. Ian Bremmer, a delegate at the World Economy Forum’s annual meeting and founder of Eurasia Group, describes this year as a “tipping point.”

The theme is captured throughout the Davos program, which contains multiple panels on “stakeholder capitalism” and tackling inequality. Participants will also discuss the future of globalization and whether central banks are out of ammunition.

Here are the hot talking points:

PEAK GLOBALIZATION?

The era of people, goods and money flowing increasingly unchecked around the world may have passed its high point as governments pursue protectionism and erect more obstacles to migration. Already there are around 77 physical barriers delineating international borders compared with 15 in 1989 after the fall of the Berlin Wall, according to Bank of America. The World Trade Organization calculates the pace of growth in international commerce fell below the rate of economic expansion in 2019 for the fifth time since the financial crisis. Foreign direct investment inflows have been on the decline since 2015, says the United Nations.

The U.S.-China trade war is at the center of the shift. But even with the signing of an interim deal, the Peterson Institute for International Economics reckons the average U.S. tariff on imports from China is still 19.3% versus 3.1% at the start of 2018.Away from Beijing, Trump is also seeking to remodel the World Trade Organization and potentially clamp down on European auto exports. The U.K. still needs to strike a post-Brexit trade deal with the European Union.

Still, the continued development of the digital economy, rising tourism and mounting reliance of companies on revenues generated outside their home market provide room for confidence globalization is evolving rather than ending.

PEAK CAPITALISM?

JPMorgan Chase & Co. CEO Jamie Dimon and BlackRock Inc. Founder Laurence Fink, both of whom will be in Davos, are among those who have entered the debate over whether companies should better weigh stakeholders such as customers and employees, a departure from the decades-old shareholder-first mindset.

Behind the shift: the rise of populism, concern wages aren’t keeping up with assets such as equities and fears over climate change.

The maturing millennial generation are a driving force too. When making investment decisions, 87% of those born between 1981 and 1996 believe environmental, social and governance factors are important, according to Bank of America.

PEAK INEQUALITY?

The pressure to reduce inequality will become more urgent this decade as the UN’s Sustainable Development Goals approach their 2030 deadline. 193 governments have signed up to 17 goals, 169 targets and 304 indicators on how to end poverty, clean up the environment and share prosperity for all.

There has already been some progress. Abhijit Banerjee and Esther Duflo, last year’s winners of the Nobel Prize for economics, estimate the average income of the world’s bottom 50% of earners also almost doubled since 1980.

But William Gale of the Brookings Institution notes the 400 richest Americans owned 3.26% of wealth in 2018, up from 0.93% in 1982. The top 1% also paid about a third of their income in tax in both 1979 and 2019, he says. Expect such numbers to be bandied about ahead of the U.S. election in November, with some Democrat candidates promoting higher corporate and wealth taxes.

PEAK YOUTH?

For the first time, there are now more seniors than children in the world and that trend is set to escalate, according to the UN.The global fertility rate already halved from 5 children per woman in 1955 and the average life expectancy has increased from 31 in 1900 to 72 today and is tipped to reach 83 by the end of this century.

While another 1 billion people are expected on the planet by 2030, the demographic mix will be starkly different. For starters, the number of those aged 65 or older will outnumber children under the age of 5.The growth of the working age population is also set to slow, straining pensions and healthcare resources. In a recent paper, Stanford University Professor Charles Jones said there is a “distinct possibility” that global population will decline rather than stabilize in the long run, threatening economic growth.

PEAK CLIMATE CHANGE?

The world faces a sweeping series of climate-related tipping points — from melting ice caps to droughts and dying coral reefs. Nature magazine in November collated the risks, which they described as a climate emergency that will compel political and economic actions on emissions. 21 of the hottest years on record came in the last quarter century.

“We argue that the intervention time left to prevent tipping could already have shrunk towards zero, whereas the reaction time to achieve net zero emissions is 30 years at best,” the article’s authors wrote.

The international effort to rein in fossil fuel pollution took a knock in December after marathon UN talks watered down language on issues they had agreed on in previous years.

PEAK OIL DEMAND?

Hotter temperatures have put new scrutiny on the world’s energy mix.

This means renewable energy like solar and wind, plus electric vehicles are going to soar up the policy agenda at the cost of fossil fuel gurgling vehicles. Big Oil executives believe that peak oil demand is increasingly likely in the late 2030s.

For example, Saudi Aramco, the world’s largest oil producer and the most profitable company in the planet, said on its initial public offering prospectus that oil demand may peak around 2035, with demand “leveling off.”

PEAK CARS?

The 1.3 billion vehicles on the roads today are probably the most there will ever be. Megacities will house around two thirds of the global population by mid-century, cutting back on the need for expensive cars.

Evolving urban architecture will also increasingly constrain car usage. The shift is already underway in mature markets. Only 26% of U.S. 16-year-olds earned a driver’s license in 2017 compared with almost half just 36 years ago, according to Sivak Applied Research. Even if overall car sales remain robust, cheaper technology such as robotaxis and developments such as ride-sharing stand to take the shine off their attractiveness.

PEAK CENTRAL BANKS?

Central banks may have rescued the world from depression in the wake of the financial crisis, but their ability to turnaround their economies from here is limited after what Bank of America estimates is more than 700 interest rate cuts and around $12 trillion in quantitative easing since 2009.

Negative interest rates are already being blamed for hurting banks, while demographic shifts, record debt levels, technological disruption and bank deleveraging all sap the potency of monetary policy. That leaves politicians under pressure to loosen fiscal policy the next time trouble hits the world economy.

–With assistance from Zoe Schneeweiss.

Bloomberg



17 Comments on "Welcome to ‘Peak Decade,’ From Globalization to Central Banks"

  1. JuanP on Sun, 19th Jan 2020 9:08 pm 

    Having been largely absent from this board, I see that the Davy exceptionalist freak show continues to account for most of the comments. The moron talks a lot but says virtually nothing.

  2. makati1 on Sun, 19th Jan 2020 10:38 pm 

    JuanP, he has used your name so many times, it is ridiculous. He has started to use mine also. Obviously, he is too stupid to realize that everyone has an individual style of writing and his is blatantly Delusional Davy.

    I post a few comments most every day. There are at least five times that number posted by him in my name. It has ruined the site. But, that is all he can do, destroy, not build, similar to the terrorist government he supports.

  3. print baby print on Mon, 20th Jan 2020 5:05 am 

    Capitalisam is in coma since 2008. On infusions of freshly printed money from the thin air

  4. DerHundistLos on Mon, 20th Jan 2020 6:53 am 

    Why are so many nations now led by extravagant buffoons? Because the nature of capitalism has changed.

    Seven years ago the brilliant impressionist Rory Bremner complained that politicians had become so boring that few of them were worth mimicking: “They’re quite homogenous and dull these days … It’s as if character is seen as a liability.” Today, his profession has the opposite problem: however extreme satire becomes, it struggles to keep pace with reality. The political sphere, so dull and grey a few years ago, is now populated by preposterous exhibitionists.

    This trend is not confined to the UK – everywhere the killer clowns are taking over. Boris Johnson, Nigel Farage, Donald Trump, Narendra Modi, Jair Bolsonaro, Scott Morrison, Rodrigo Duterte, Matteo Salvini, Recep Erdogan, Viktor Orban and a host of other ludicrous strongmen – or weakmen as they so often turn out to be – dominate nations that would once have laughed them off stage. The question is why? Why are the deathly technocrats who held sway almost everywhere a few years ago giving way to extravagant buffoons?

    Social media, which is an incubator of absurdity, is certainly part of the story. But while there has been plenty of good work investigating the means, there has been surprisingly little thinking about the ends. Why are the ultra-rich, who until recently used their money and newspapers to promote charisma-free politicians, now funding this circus? Why would capital wish to be represented by middle managers one moment and jesters the next?

    The reason, I believe, is that the nature of capitalism has changed. The dominant force of the 1990s and early 2000s – corporate power – demanded technocratic government. It wanted people who could simultaneously run a competent, secure state and protect profits from democratic change. In 2012, when Rory Bremner made his complaint, power was already shifting to a different place, but politics had not caught up.

    The policies that were supposed to promote enterprise – slashing taxes for the rich, ripping down public protections, destroying trade unions – instead stimulated a powerful spiral of patrimonial wealth accumulation. The largest fortunes are now made not through entrepreneurial brilliance but through inheritance, monopoly and rent-seeking: securing exclusive control of crucial assets, such as land and buildings, privatised utilities and intellectual property, and assembling service monopolies such as trading hubs, software and social media platforms, then charging user fees far higher than the costs of production and delivery. In Russia, people who enrich themselves this way are called oligarchs. But this is not a Russian phenomenon, it is a global one. Corporate power still exists, but today it is overlain by – and is mutating into – oligarchic power.

    What the oligarchs want is not the same as what the old corporations wanted. In the words of their favoured theorist Stephen Bannon, they seek the “deconstruction of the administrative state.” Chaos is the profit multiplier for the disaster capitalism on which the new billionaires thrive. Every rupture is used to seize more of the assets on which our lives depend. The chaos of an undeliverable Brexit, the repeated meltdowns and shutdowns of government under Trump: these are the kind of deconstructions Bannon foresaw. As institutions, rules and democratic oversight implode, the oligarchs extend their wealth and power at our expense.

    The killer clowns offer the oligarchs something else too: distraction and deflection. While the kleptocrats fleece us, we are urged to look elsewhere. We are mesmerised by buffoons, who encourage us to channel the anger that should be reserved for billionaires towards immigrants, women, Jews, Muslims, people of colour and other imaginary enemies and customary scapegoats. Just as it was in the 1930s, the new demagoguery is a con, a revolt against the impacts of capital, financed by capitalists.

    The oligarch’s interests always lie offshore: in tax havens and secrecy regimes. Paradoxically, these interests are best promoted by nationalists and nativists. The politicians who most loudly proclaim their patriotism and defence of sovereignty are always the first to sell their nations down the river. It is no coincidence that most of the newspapers promoting the nativist agenda, whipping up hatred against immigrants and thundering about sovereignty, are owned by billionaire tax exiles, living offshore.

    As economic life has been offshored, so has political life. The political rules that are supposed to prevent foreign money from funding domestic politics have collapsed. The main beneficiaries are the self-proclaimed defenders of sovereignty, who rise to power with the help of social media ads bought by persons unknown, and thinktanks and lobbyists that refuse to reveal their funders. A recent essay by the academics Reijer Hendrikse and Rodrigo Fernandez argues that offshore finance involves “the rampant unbundling and commercialisation of state sovereignty” and the shifting of power into a secretive, extraterritorial legal space, beyond the control of any state. In this offshore world, they contend, “financialised and hypermobile global capital effectively is the state.”

    Today’s billionaires are the real citizens of nowhere. They fantasise, like the plutocrats in Ayn Rand’s terrible novel Atlas Shrugged, about further escape. Look at the “seasteading” venture funded by Paypal’s founder Peter Thiel, that sought to build artificial islands in the middle of the ocean, whose citizens could enact a libertarian fantasy of escape from the state, its laws, regulations and taxes, and from organised labour. Scarcely a month goes by without a billionaire raising the prospect of leaving the Earth altogether, and colonising space pods or other planets.

    Those whose identity is offshore seek only to travel further offshore. To them, the nation state is both facilitator and encumbrance, source of wealth and imposer of tax, pool of cheap labour and seething mass of ungrateful plebs, from whom they must flee, leaving the wretched earthlings to their well-deserved fate.

    Defending ourselves from these disasters means taxing oligarchy to oblivion. It’s easy to get hooked up on discussions about what tax level maximises the generation of revenue. There are endless arguments about the Laffer curve, that purports to show where this level lies. But these discussions overlook something crucial: raising revenue is only one of the purposes of tax. Another is breaking the spiral of patrimonial wealth accumulation.

    Breaking this spiral is a democratic necessity: otherwise the oligarchs, as we have seen, come to dominate national and international life. The spiral does not stop by itself: only government action can do it. This is one of the reasons why, during the 1940s, the top rate of income tax in the US rose to 94%, and in the UK to 98%. A fair society requires periodic corrections on this scale. But these days the steepest taxes would be better aimed at accumulated unearned wealth.

    Of course, the offshore world the billionaires have created makes such bold policies extremely difficult: this, after all, is one of its purposes. But at least we know what the aim should be, and can begin to see the scale of the challenge. To fight something, first we need to understand it.

    George Monbiot

  5. Davy on Mon, 20th Jan 2020 7:34 am 

    “$6.4 Trillion And Counting – How The Military-Industrial Complex Hijacked The War On Terror”
    https://tinyurl.com/sap5z6z zero hedge

    “Ike Was Right!
    “In the councils of government, we must guard against the acquisition of unwarranted influence, whether sought or unsought, by the military-industrial complex. The potential for the disastrous rise of misplaced power exists, and will persist.”

    “Now this conjunction of an immense military establishment and a large arms industry is new in the American experience. The total influence—economic, political, even spiritual—is felt in every city, every Statehouse, every office of the Federal government. We recognize the imperative need for this development. Yet, we must not fail to comprehend its grave implications. Our toil, resources, and livelihood are all involved. So is the very structure of our society.”

    “General Dwight D Eisenhower
    Farewell address 1961””

    ““Today’s Republican Party is a collection of rural interests from flyover country, handmaidens of the military industrial complex and, most important, militant evangelical Christians who see the world through the spectrum of the Old Testament. Israel’s far right has come to dominate American evangelists by selling them a bill of goods about the End of Days and the Messiah’s return. Many of these rubes see Trump as a quasi-religious figure.”

    “Mix the religious cultists – about 25% of the US population – with the farm and Israel lobbies and the mighty military industrial complex and no wonder the United States has veered off into the deep waters of irrationality and crusading ardor. The US can still afford such bizarre behavior thanks to its riches, magic green dollar, endless supply of credit and a poorly educated, apathetic public too besotted by sports and TV sitcoms to understand what’s going on abroad.”

    “All the war party needs is a steady supply of foreign villains (preferably Muslims) who can be occasionally bombed back to the early Islamic age. Americans have largely forgotten George W. Bush’s lurid claims that Iraqi drones of death were poised to shower poisons on the sleeping nation. Even the Soviets never ventured so deep into the sea of absurdity.”

    “The military industrial complex does not care to endanger its gold-plated F-35 stealth aircraft and $13 billion apiece aircraft carriers in a real war against real powers. Instead, the war party likes little wars against weak opponents who can barely shoot back. State-run TV networks thrill to such minor scraps with fancy headlines and martial music. Think of the glorious little wars against Panama, Grenada, Somalia, Iraq, Syria, Afghanistan and Libya. Iran looks next.”

    “The more I listen to his words, the more I like Ike.”

  6. Cloggie on Mon, 20th Jan 2020 7:52 am 

    The above is JuanP stealing Davy’s ID like the coward he is. Everyone knows he is a piece of shit. Probably a closet Jew lover.

  7. DerHundistLos on Mon, 20th Jan 2020 8:08 am 

    Really “Cloggie” or much more likely an imposter?

    Are you clairvoyant or did “you” post the above?

    How exactly do you know Davy did not post the above article?

  8. Cloggie on Mon, 20th Jan 2020 8:09 am 

    Der Hund, the impostor is JuanP. You are an old guy like makati1 and you guys are not situationally aware. Get with it stupid

  9. DerHundistLos on Mon, 20th Jan 2020 8:11 am 

    “Mix the religious cultists – about 25% of the US population – with the farm and Israel lobbies and the mighty military industrial complex and no wonder the United States has veered off into the deep waters of irrationality and crusading ardor.”

    Makes sense. John McCain’s campaign manager, Steve Schmidt, commented that about 1/3 of the US population has always been nuttier than a fruitcake.

  10. DerHundistLos on Mon, 20th Jan 2020 8:15 am 

    “cloggie et al”

    Save the “situationally aware” stupid, psycho-babble for someone who cares.

    Glad to know “you’re” omnipotent-lol.

  11. JuanP on Mon, 20th Jan 2020 8:17 am 

    ROTFLO, Der Hund I love fooling people. This is what I enjoy so FUCK YOU

  12. More Davy ID Fraud on Mon, 20th Jan 2020 8:28 am 

    Cloggie on Mon, 20th Jan 2020 7:52 am

    Cloggie on Mon, 20th Jan 2020 8:09 am

    JuanP on Mon, 20th Jan 2020 8:17 am

  13. DerHundistLos on Mon, 20th Jan 2020 10:06 am 

    Sorry guys, I hope I didn’t miss it.
    Where’s the lemon party?

  14. More Davy ID Fraud on Mon, 20th Jan 2020 11:10 am 

    DerHundistLos on Mon, 20th Jan 2020 10:06 am

  15. Richard Guunette on Mon, 20th Jan 2020 11:31 am 

    Obviously the above was JuanP. I have no idea what a lemon party is. JuanP took claes ID yesterday and introduced the Lemon Party thing. JuanPee is a prickface moron.

  16. More Davy ID Fraud on Mon, 20th Jan 2020 11:43 am 

    Richard Guunette on Mon, 20th Jan 2020 11:31 am

  17. Richard Guunette on Mon, 20th Jan 2020 11:59 am 

    Let’s banish the moron

    This is from juanPee
    More Davy ID Fraud said Richard Guunette on Mon, 20th Jan 2020 11:31 am

    More Davy ID Fraud said Richard Guunette on Mon, 20th Jan 2020 11:30 am

    More Davy ID Fraud said Richard Guunette on Mon, 20th Jan 2020 11:37 am

    More Davy ID Fraud said Richard Guunette on Mon, 20th Jan 2020 11:29 am

Leave a Reply

Your email address will not be published. Required fields are marked *