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Five Ways the Global Economy Is Rebounding

Good comments, both pro and con, regarding this post.
With oil prices plunging it is hard for me to point out that I just got through re-watching Running on Empty. If we are at peak oil, with production soon to decline while world demand rises, the price of oil will soar once again.

But the thoughtful scholars in this documentary point out that long term the loss of cheap fossil fuel will reverse globalization as we are forced to look for closer sources for our food and products. This will be inevitable. As one put it, the 2,000 mile Caesar salad from California to Toronto (or was it Quebec) will be over.

They rightly point out the whole American mantra of ever expanding growth was an illusion totally fostered by cheap fossil energy. It is impossible to have an ever expanding economy within a finite system, which the earth truly is.

We will all be led to this final reality, kicking and screaming - me included - but the global economy will disintegrate into local and some regional economies, not unlike a few centuries ago.

Sure, there will always be some long- range trade or "globalization", as evidenced in the ancient spice trading routes that cut through northern Africa.

But really, as energy becomes more precious how much longer can we fly in apples from New Zealand and truck potatoes from Idaho to Maine? Wal-Mart - which the documentary notes along with Costco and other big chains - totally destroyed local and regional transportation networks, which will have to be rebuilt.

But this will play out over decades so for now I guess you can make your global investment plays. It took a few hundred years before Rome totally realized it no longer really existed.

Dan