Yves Smith — “How Complex Systems Fail”

Lambert found a short article by Richard Cook that I’ve embedded at the end of the post. I strongly urge you to read it in full. It discusses how complex systems are prone to catastrophic failure, how that possibility is held at bay through a combination of redundancies and ongoing vigilance, but how, due to the impractical cost of keeping all possible points of failure fully (and even identifying them all) protected, complex systems “always run in degraded mode”.

Naked Capitalism
“How Complex Systems Fail”
Yves Smith

J. D. Alt — Halfway There

If you graph this wildlife population loss, it looks uncannily similar to the graph-line of “Nature” in the HANDY Model: a point is reached where, suddenly, after a steady rise, or a gradual equilibrium, the graph-line of “Nature’s” population changes direction and begins to plummet. What is startling about the HANDY Model is that when this happens, the human populations of “Elites” and “Commoners” continue to rise, crossing the falling graph-line of “Nature.” This is called “overshoot”—the point where the human population begins consuming “Nature’s” resources faster than “Nature” can replenish them. The human population, after some period of “overshoot,” begins (of necessity) to collapse as well. The population of “Commoners” collapses first because the “Elites” are able, for a period of time, to thrive on their “Wealth.” In some iterations of the model, “Nature” recovers after the “Elite” population finally base-lines; in other iterations “Nature” fails to recover at all—the world becomes simply a wasteland, like one of those planets we keep investigating to see if it ever supported life.

The reality is that if there would be an apocalyptic  collapse of "civilization," it wouldn't be the elites that would survive, but the remaining indigenous peoples and those living in the "informal economy." And maybe some preppers, but it's probably more likely that they would kill each other off in the search for remaining resources as their stocks ran low.

New Economic Perspectives
Halfway ThereJ. D. Alt

Sarah Lazare — 'Collapse' of Modern Civilization a Real Possibility: Study

"Ecological strain" and "economic stratification" could lead to the global fall of modern civilization on a global scale, researchers warn in a disturbing new study (PDF) sponsored by by NASA's Goddard Space Flight Center.

Common Dreams
'Collapse' of Modern Civilization a Real Possibility: Study
Sarah Lazare

Ellen Brown — Is Homeland Security Preparing for the Next Wall Street Collapse?

The fact that we are actually talking about this, with links to the establishment media, is pretty shocking. The global financial crisis is not over, and the capitalist system is teetering.

Web of Debt
Is Homeland Security Preparing for the Next Wall Street Collapse?
Ellen Brown

Wrong & Wronger

A reader at a widely circulated, state "Monetary Policy" group circulated the following statement. They'll go unnamed to protect the innocently ignorant from embarrassment. Neverthless, this is a warning example of how UN-informed our electorate has become, and their "expert advisors" as well.

"Paul Craig Roberts was an editor at the WSJ and worked at treasury. So, his observations are interesting and credible. I suggest his post today on Collapse at Hand."

And Herbert Hoover once worked for the US government! People are wrong all the time, even totally out of paradigm, and that is exactly what Paul Craig Roberts is.  There may well be a collapse, but it will be caused by public ignorance, not any problem with a fiat currency supply!

PCR's essay is so wrong that it's embarrassing to read. It's wronger than wrong.  It's so bad it's not even wrong!  I left the following comment at the site in question, but wish there were some way to distribute MANY VARIATIONS of the following introduction to all "experts," teachers, parents, students and citizens nationwide - this week!

Everything, and I do mean EVERYTHING, about fiscal & monetary policy changed when we exited the gold std for a fiat currency std. That occurred first in 1933, and the last vestige went in 1973, when Nixon closed the inter-gov gold/$US convertibility window.

First, look up the dictionary definition of "fiat." Then tell yourself that we have a fiat currency std.

Then actually think about what that means.

It means we manage the currency supply to serve economic demand, and the currency supply is NOT yoked to any arbitrary commodity definition of static value.

What IS the currency value linked to? First, fiat currency value floats, and is meant to float, exactly so that it can respond in real time to the agile demands of an agile, GROWING electorate. Fiat currency is essentially "backed" ONLY by the constantly expanding will, initiative and credit of the US population.

Until we run out of public initiative, we can't run out of fiat currency.

1) We have no national debt, except in an accounting sense, which is a total, semantic misuse of our daily understanding of debt. National "debt" tracks growth of the fiat currency supply, which by definition is that amount of currency spent into existence by the USA and NOT clawed back via taxes. As such, the supposed national "debt" = national private savings, to the penny. Sheesh! This is not rocket science, people. This has been amply discussed and written about since Ben Franklin's first paper on fiat currency, in 1727 (and long before that, too).

2) We owe China nothing. Our Treasury Securities are NOT national debt.
China sends us real goods, and receives $US as payment, which they accumulate as currency reserves. Hence, China has already been paid in full, as have all other groups who export to the USA. What do other nations DO with the $US currency reserves they accumulate? They either sit on them, exchange some of them back into their local currency (which drives up their currency & lowers the value of their exports, so they try not to), or they buy things sold in $US denominations (our exports, and notably oil). If they sit on them, they MAY decide to transfer some of their Currency Reserves to Treasury Securities, which simply transfers the reserves from one to another account at our Federal Reserve. Along the way, people buying TS's get some trivial, fiat interest, of no consequence to a fiat currency issuer.

3) The dominant goals of fiscal & monetary policy in a fiat currency system are:
..
a) don't have so much currency circulating that we cause inflation
(seen any NET inflation recently?)
..
b) don't have so little currency circulating that a growing population
experiences deflation (what we're currently seeing, overall).

Everything else falls under the heading of controlling graft, corruption and sharing of misinformation - which we're definitely seeing a LOT of the past 39 years. It's scarcely to be believed how poorly informed our electorate has become, about it's OWN, public operations. Tom Jefferson & John Adams would be appalled!

4) Why do we even bother selling Treasury Reserves? It's actually simply a habit left over from the long-ago gold-std days. The ONLY function of Treasury Reserves - since 1933 - is to fulfill bankers obsession with double-entry bookkeeping practices. Treasury Securities are sold ONLY to drain Banking Reserves from the Federal Reserve accounts of private banks. It's that simple.

"The Treasury tax and loan account system was designed as a mechanism for minimizing the dislocations on bank reserves and the money market arising out of the sizable and irregular transfers between the Government and the public."
Treasury tax and loan accounts and Federal Reserve open market operations

TTL Note Accounts and the Money Supply Process

Those wanting a primer on how a modern currency system works should read Warren Mosler's little Dick & Jane money book for citizens, or the many articles by Bill Mitchell, Randall Wray or Stephanie Kelton, etc, etc.

Maybe someone could even get Paul Craig Roberts to do a book review on Warren Mosler's book?  If PCR learns to read more widely, maybe Timmy the Mole could too?  Even some President of the USA?  Sky's the limit folks.  One little ounce of shared knowledge could set us free.

AFP — Environmental collapse now a serious threat: scientists

PARIS — Climate change, population growth and environmental destruction could cause a collapse of the ecosystem just a few generations from now, scientists warned on Wednesday in the journal Nature.

The paper by 22 top researchers said a “tipping point” by which the biosphere goes into swift and irreversible change, with potentially cataclysmic impacts for humans, could occur as early as this century.

The warning contrasts with a mainstream view among scientists that environmental collapse would be gradual and take centuries.

The study appears ahead of the June 20-22 UN Conference on Sustainable Development, the 20-year followup to the Earth Summit that set down priorities for protecting the environment.
The Nature paper, written by biologists, ecologists, geologists and palaeontologists from three continents, compared the biological impact of past episodes of global change with what is happening today.

Read the rest at RawStory
Environmental collapse now a serious threat: scientists
by Agence France-Presse

This conclusion echos that of James Lovelock some time ago. Lovelock recently retracted his dire warning to bring it in line with the majority view. Now here is a significant group of experts agreeing with Lovelock's initial conclusion based on the interaction of influences in a tightly integrated system — much like the financial collapse resulting from misjudgment of the degree of systemic risk.

The team determined that once 50-90 percent of small-scale ecosystems become altered, the entire eco-web tips over into a new state, characterised especially by species extinctions. 

Once the shift happens, it cannot be reversed.

 To support today’s population, about 43 percent of Earth’s ice-free land surface is being used for farming or habitation, according to the study.

 On current trends, the 50 percent mark will be reached by 2025, a point the scientists said is worryingly close to the tipping point.

If that happened, collapse would entail a shocking disruption for the world’s food supply, with bread-basket regions curtailed in their ability to grow corn, wheat, rice, fodder and other essential crops.

Yikes!

Sharon Astyk — Collapse? Really?

Sharon Astyk investigates the meaning of the increasingly used term "collapse and finds six characteristics of societal collapse.

Read it at The Post Carbon Institute
Commentary: I. Collapse? Really?

Sharon Astyk