The Crash Course (seminar on the economy)

[zl]

http://www.chrismartenson.com/crashcourse/chapter-1-three-beliefs

It's a 20-chapter overview of the state of our economy, energy and environment.

I think it's clear and honest in a sea of misinformation - I finally think I have a handle on what's going on.

I'd be interested to hear what any of you think!

[RomanClock]

Watched to 7 so far, nothing new to me.

[zl]

bmp

[zl]

Chris just released a 45-minute version of the course.

I keep rewatching the 3-hour version with different friends - every time, it's very much worth it.  Please consider watching it!!

[AstronautClock]

things are not looking good for us it seems

[zl]

things are not looking good for us it seems

we need a clock crew commune

[AstronautClock]

we need to get rid of money and all problems are solved basically

[DiscoBallClock]

Watching atm

[zl]

we need to get rid of money and all problems are solved basically

and some problems are created too, but I think they're a better brand of problem

Watching atm

<3

[zl]

bump

please watch

[WrenchClock]

Philosiphisin' with ZL

[zl]

if you'd rather be reading than watching, there's similar information in an article here.

I honestly think this video and article are the most important things for anyone to be reading at this point in history.

The clock crew is a weird place to share serious information.  If even one or two of you learn this stuff I'd feel very happy.

Plus I'd have somebody to talk to.

It's incredible how hard it is to get the people around me to read this.  Your actions after getting this information could literally be the most important things you do in your life.. It's one of the most insane moments in human history and very few people are listening.

[buttplug]

god yes it even has default gradients

[Thunderbolt]

I watched all the 45 minutes and I got one conclusion, we are fucked most probably

[Slurpee]

I was like
okay it's in chapters I'll just watch a bit and come back later

and now I'm on chapter 12 and I can't stop

so I guess it's good that I don't really have anything to do today

[Slurpee]

okay so I watched the whole thing, furrowed my brows, and then shared it on facebook
and my friend sean reposted it
and then this adorable fobby nerd we knew from high school, liye, was like hahahahahahaha oh you're not joking well just a moment, and then he rebutted

I apologize for my tone, but you have to understand that this article is like someone trying to justify flat earth theory by invoking plate tectonics. Very entertaining reading, and I really did think you were joking.

As for the Chinese deleveraging, here is the link:
http://news.xinhuanet.com/english2010/business/2010-05/02/c_13276172.htm
Here is a even earlier move: (they like doing things gradually)
http://online.wsj.com/article/SB10001424052748703525704575060813470407750.html

(For reference, the leverage ratio is the inverse of the reserve requirement) (Well, there are exceptions, but that is the usual rule of thumb)

As for holes, well, lets start with part 3 - (the first 2 don't say anything detailed) global population growth is already slowing down, despite the antics of article. And human population growth have never been observed to grow at an exponential rate anyways (cubic growth is much closer to the truth)
http://en.wikipedia.org/wiki/File:World-Population-1800-2100.png (note that the medium projections have it going down, and past medium projections have overstated growth)

And as for oil, well, if he truly believes in what he says, he should be far too busy making money to be writing this, as wall street's gamblers all disagree with him, and he could make a huge amount of money by betting against them. (For example, buying a barrel of oil for delivery 3 years from now cost 86 dollars. If you think that oil prices is going to go though the roof, there is money to be made) (oil is 75 dollars per barrel right now, by the way, so we expect weak price increases)

As far as the US money supply goes, well, that is one thing that we all expect to grow - the last time where it failed to grow, we got the great depression. And it grows at roughly the pace that economists wants it to. (And the fed can control its rate with extreme accuracy)

Part 4 is standard math. Nothing wrong there. Part 5 is where it gets really weird - what in the world does 100% energy income to grow even mean? Does he presume current rates of growth? (In that case, we can maintain the status quo by not growing at all, not great, but it is status quo) In any case, the lack of understanding of what growth is is pretty humorous.

Part 5-11 are standard hyperinflation bullshit (granted, he does make more mistakes then your normal hyperinflation world is falling guy, which makes for better comedy). The fastest way to relieve yourself of any concern is to look at TIPS bonds. http://en.wikipedia.org/wiki/Treasury_Inflation-Protected_Securities#TIPS
So right now, people are indifferent between a normal bond yielding at 3%, and a inflation adjusted bond yield 1.25%. That means there is money to be made if the inflation rate is going to be more then 1.7%. Once again, we have to to ask why this guy is not putting his money where his mouth is.

(It is particularly amusing that in part 11, he even managed to get the definition of a word wrong - inflation doesn't mean what he thinks it means)

12-15 is simply great comedy, as he misses the most fundamental point of all - every dollar of debt that someone have must be owed to somebody. Therefore, in the whole economy, the net debt have to be, well, zero. (if I borrow 20 dollars, that means that someone else have to have a IOU from me that is worth 20 dollars. It doesn't matter what anyone does, the total net debt can't go anywhere)

Part 16 will actually take a bit to explain, but it is fairly easy to take apart their formula for inflation - run it backwards. That is, instead of calculating the inflation going from 2009-2010, calculate the inflation going from 2010-2009. Well, if you use their formula, you end up with a positive number in both cases. That is to say, that formula thinks that prices went up going from 2009-2010, and it thinks that prices went up going from 2010-2009. Obviously, it means that the formula have to be badly wrong.

The peak oil nonsense is answered with a glance at oil futures. And his actions recommendations, well, they contradict most of what he was saying in eariler chapters (great comedy). If you think the world is heading into a deflationary spiral where assets become worth less and less (point of part 17), buying gold is kind of the last thing you want to do. And you are worried about hyperinflation, (the point of part 5-11), saving money is also the last thing that you want to do. (hyperinflation clears all debts away, so you might as well take on as much as you can)

after briefly weighing both sides of the issue I'm forced to accede the possibility that mr. martenson may simply be mistaken in a number of ways and that I wasn't thinking as critically as I should have upon watching this.

I haven't taken the time to cross-check everything liye said or reexamine the presentation itself too closely, but from what I've looked into he's right, and the thing of it is liye doesn't really have a horse in this race, so I'm inclined to believe he's speaking on a purely academic level.

[zl]

Here's how his rebuttal strikes me.

As for holes, well, lets start with part 3 - (the first 2 don't say anything detailed) global population growth is already slowing down, despite the antics of article. And human population growth have never been observed to grow at an exponential rate anyways (cubic growth is much closer to the truth)
http://en.wikipedia.org/wiki/File:Wo...-1800-2100.png (note that the medium projections have it going down, and past medium projections have overstated growth)

It's true, growth is slowing down - I didn't know that. According to wikipedia, it was at 1.1% in 2009 - slightly higher than martenson says in the crash course - down from a peak of 2.2%.  Here's a chart of the growth change. It doesn't look like a super dependable trend to me, but if the growth follows the most recent line, we have 30-50 more years of growth before that percent hits zero.   So population continues upwards.

In fact, even the most conservative UN estimate predicts 20 more years of growth, and up to...well over 100.

And as for oil, well, if he truly believes in what he says, he should be far too busy making money to be writing this, as wall street's gamblers all disagree with him, and he could make a huge amount of money by betting against them. (For example, buying a barrel of oil for delivery 3 years from now cost 86 dollars. If you think that oil prices is going to go though the roof, there is money to be made) (oil is 75 dollars per barrel right now, by the way, so we expect weak price increases)

If you expect money destruction through hyperinflation, how can you possibly think that any money you invest in the stock market will come back to you? When you expect money to become worthless, you buy tangible assets. Here's something Chris wrote about his opinion of stocks and bonds.

As far as the US money supply goes, well, that is one thing that we all expect to grow - the last time where it failed to grow, we got the great depression. And it grows at roughly the pace that economists wants it to. (And the fed can control its rate with extreme accuracy)

Do you expect it to grow like this? Like this? If this is growing "at roughly the pace that economists want it to," why do economists want money supply to skyrocket?  Skyrocketing money causes inflation, right?

Part 4 is standard math. Nothing wrong there. Part 5 is where it gets really weird - what in the world does 100% energy income to grow even mean? Does he presume current rates of growth? (In that case, we can maintain the status quo by not growing at all, not great, but it is status quo) In any case, the lack of understanding of what growth is is pretty humorous.

New schools for new children versus new books for existing schools.  Energy towards more people or energy towards existing people.  What's not to understand?

Also, no growth doesn't mean maintaining the status quo.  Our energy is being reduced from two sides - more people using it, AND less of it being produced. Zero growth only stops one one drain (and the lesser one).

Part 5-11 are standard hyperinflation bullshit (granted, he does make more mistakes then your normal hyperinflation world is falling guy, which makes for better comedy). The fastest way to relieve yourself of any concern is to look at TIPS bonds. http://en.wikipedia.org/wiki/Treasur...ecurities#TIPS
So right now, people are indifferent between a normal bond yielding at 3%, and a inflation adjusted bond yield 1.25%. That means there is money to be made if the inflation rate is going to be more then 1.7%. Once again, we have to to ask why this guy is not putting his money where his mouth is.

I wasn't aware that there was a such thing as "typical hyperinflationary bullshit."  I guess liye has been dealing with this sort of material before.  So his rebuttal is that... Chris could be making money by gambling on his predictions.  Well he IS putting his money where his mouth is...by selling his house, and renting in a progressive community in Springfield, MA.  He's near farmland and a community of people who care about local sustainability.  That seems more important than hoping for extra wealth in a currency you don't trust by investing in failing banks.  If I believe that the banking system is going to fail (won't be bailed out through printing money next time), why would I put my money in a 5-30 year bond?

12-15 is simply great comedy, as he misses the most fundamental point of all - every dollar of debt that someone have must be owed to somebody. Therefore, in the whole economy, the net debt have to be, well, zero. (if I borrow 20 dollars, that means that someone else have to have a IOU from me that is worth 20 dollars. It doesn't matter what anyone does, the total net debt can't go anywhere)

This is loony!  Alright first: in a national economy, that debt can be owed to someone outside the country.  So, net negative.  Second, all debt charges interest.  That means all debt requires MORE than what was borrowed.  Simply great comedy

Part 16 will actually take a bit to explain, but it is fairly easy to take apart their formula for inflation - run it backwards. That is, instead of calculating the inflation going from 2009-2010, calculate the inflation going from 2010-2009. Well, if you use their formula, you end up with a positive number in both cases. That is to say, that formula thinks that prices went up going from 2009-2010, and it thinks that prices went up going from 2010-2009. Obviously, it means that the formula have to be badly wrong.

When he says "their formula," he must be talking about the one Chris suggests using, right?  The one that "simply tracks the exact same shopping basket of thirty goods from one year to the next"? Here's the farm bureau article describing the price during the first and second quarter of 2010. It says it's gone from $45.54 to $47.20.  That's positive $1.66 change.  $1.66/$45.54 is roughly 3.65% change.  Backwards, that's negative 1.66 divided by 47.20, roughly to -3.62% change. No problem with that formula that I see.

This is stupid obvious and I think I must not understand liye.  Is he talking about the backwards techniques used in governmental statistics? If so, he's on the same page as me and Chris - they are illegitimate, backwards, and have no basis in sound mathematics.

The peak oil nonsense is answered with a glance at oil futures. And his actions recommendations, well, they contradict most of what he was saying in eariler chapters (great comedy). If you think the world is heading into a deflationary spiral where assets become worth less and less (point of part 17), buying gold is kind of the last thing you want to do. And you are worried about hyperinflation, (the point of part 5-11), saving money is also the last thing that you want to do. (hyperinflation clears all debts away, so you might as well take on as much as you can)

Honestly, disproving peak oil by looking at oil futures?  I glanced at them and it didn't really answer the question for me.  Or anything.  Why should I trust oil futures?

Gold is good in hyperinflation and bad in deflation, I agree.  Saving money is bad in hyperinflation, agreed.  Chris believes in hyperinflation, and recommends gold, not saving.  I'm not sure about either path for money..so I'm interested in buying seeds and tools that will be useful in either case.


I didn't respond to the Chinese leveraging because that is over my head.  If he's making a good point with it, I need to learn more before I can figure it out.

Anyway thank you for watching and sharing it Slurpee

[Slurpee]

liye was probably not taking into account the currency collapse when ruminating on investment opportunities, and I suppose the population receding doesn't mean much if it's barely even projected to happen within my lifetime, and the money supply growth rate does seem to have grown out of control in recent years, so he may have been ill-informed there.
I'd have to ask him but I think the formula he was referring to was a semantical misunderstanding of "If you were to measure inflation, you'd probably track the cost of a basket of goods from one year to the next, subtract the two, and measure the difference." You can probably see how this would be interpreted as always resulting in a positive integer.

from what I remember of him, liye has a tendency to lose the forest for the trees. as I said, I haven't taken the time to cross-check everything he said or reexamine the presentation itself too closely.

most of my remaining areas of uncertainty are things that I don't really have a formal understanding of, like the nature of debt and the full utility of assets without the context of a regulated economy. economics is one of my many weaknesses.

I feel myself turning around on this again.

hahahaha I'm sorry if I'm coming off wishy-washy, but I've been having trouble forming a complete picture of this in my head, which isn't really a sensation that I'm used to.

[zl]

I first watched the crash course 2 years ago...it's only just now beginning to really sink in.

Early US money was awesome, by the way.  This (unprofessional) documentary has some more depth about how money has changed in America: [U2]1FiaUpeJxcA[/U2]

Makes me all patriotic, in regards to our founding fathers.  We had such an amazing start!

[Marlin Clock]

Yeah, I don't see America's population declining very soon. It's not just that we have a relatively high birth rate, especially among other western nations, but we still have an immigration rate of about .3% of the population on top of that.