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The meta bubble

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posted on Jan, 6 2011 @ 01:41 AM
We're watching the Fed trying to re-inflate the economic bubble with mini bubbles. It was caused by a real estate bubble, which was caused by a credit bubble. The credit bubble exploited simple people, or handed out credit to the undeserving, depending on your opinion.

But that wasn't the start of the bubble. Some point to when Nixon decoupled the dollar from gold. From that point the market decided the value of the paper dollar, and since the dollar was no longer coupled with Gold, the Fed could begin printing a massive amount of dollars (by issuing credit).

Let's go a little farther back. The Boomer generation bubble was created by soldiers coming home from WW2. The boomers and their children needed homes. The world saw the USA as the land of opportunity, and waves of immigrants came to the USA from their decimated countries at the end of WW2. This population boom needed financial resources, which the Fed later supplied as credit.

What created the prior boom in population and productivity? It was the industrial revolution, mass production of everything including food. What enabled the industrial revolution? Energy. What happens to production when energy production doesn't keep pace with the population growth? The pop of the meta bubble?

I'm not talking about peak oil, or slow implementation of highly expensive green energy sources, or overconsumption of existing energy resources. But just keeping up with population growth.

Nature has a way of taking care of itself. In economics, trend lines seek equilibrium. I wonder what will happen with these graphs? And how it will happen? I'm thinking that the global meltdown is merely a small symptom of a much larger and slower moving event.

The first graph is from, the second graph is from wikipedia.

posted on Jan, 6 2011 @ 01:49 AM
i dont know about you but those graphs terrify me. its all way out of control.

posted on Jan, 7 2011 @ 05:47 PM
Nearly every economic graph will show oscillations. The value of stocks and bonds go up and down and oscillate along a trend line which also oscillates. The human population has oscillated in the past with wars, diseases, climate changes and the resulting exhaustion of resources. Naturally we should expect corrections of any values expressed in a hockey stick.

If a few hundred or thousand or two years ago, mathematicians were able to foresee the hockey stick growth of human population, they'd warn of a pending reversal. Logically some natural force or a combination of natural forces will cause a correction. One or more resources required for the population explosion is sure to be exhausted. Identifying risks of exponential population growth will appear as hazy warnings which to those who didn't do the math, look like supernatural prophecies or ramblings of mad men warning of an upcoming apocalypse.

The increased population will also mean a decrease in liberties. Using firewood as an example; in low density areas, a fireplace is warm and cozy place for the family to build bonds around. If everyone in a high density area (city) or even an apartment building started up their fireplace, the city would be smoked out. In the countryside, you harvest and chop firewood, but if everyone did that in the city, parks would be decimated.

Point is, the bubbles of the economic system are created to support the needs of a booming global population and high density concentrations of population. If money represented a finite supply of gold, and population growth was exponential, the value of money would inflate causing prices to deflate. These economic bubbles and meltdowns are a symptom of the problem of trying to support an explosive growth in global human population.

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