Facing facts: Definancialisation, deglobalisation and relocalisation

Getting the complexity message across to people who don’t want to know or understand is really tough.

But it may comes as a surprise to some (outwith the industry) that it is incredibly difficult to introduce new, better, more reliable and comprehensive means of managing risk to Financial Services companies…even though it would, significantly, improve their bottom-line – enabling them to improve their customer proposition!

SO, in the circumstances, you may understand why I rarely trouble anyone for their thoughts on “peak oil”, how we can best prepare for a post critical society, how we survive and re-build society. Read more of this post

In the world, at the limits to growth

David Korowicz tells it how he does…and that is HOW IT IS! Please search David’s name on this site or on Google for some more really insightful reading and viewing: ignorance is no excuse!!!

The reality is that we are locked into an economy adapted to growth, and that means rising energy and resource flows and waste. By lock-in, we mean that our ability to change major systems we depend upon is limited by the complexity of interdependencies, and the risk that the change will undermine other systems upon which we depend.

So we might wish to change the banking or monetary system, but if the real and dynamic consequences lead to a major bank freeze lasting more than a couple of days we will have major food security risks, massive drops in economic production, and risks to infrastructure. And if we want to make our food production and distribution more resilient to such shocks, production will fall and food prices will need to be higher, which will in the short-to-medium term drive up unemployment, lead to greater poverty, and put even greater pressure on the banking system.

via In the world, at the limits to growth | Energy Bulletin.

Still don’t “get” Complexity? Try this…

This brief extract is from an excellent paper “Tipping Point”  by Dr David Korowicz of FEASTA who tells me that, it was, “an attempt to describe globalised complexity in more popular form”. In my opinion it is considerably more than that!

I have tried this myself and it isn’t easy but I think he has done a great job. Judge for yourself.

Last year I used one of his video presentations with the (not at all) understated title of:

All you could ever want to know about why complexity is THE big deal if you want to gain an understanding you won’t be disappointed.

Here is a vivid description of one aspect of complexity by Eric Beinhocker who compares the number of distinct culturally produced artefacts produced by the Yanomamo tribe on the Orinoco River, and modern New Yorkers. The Yanomamo have a few hundred, the New Yorkers have in the order of tens of billions, and this wealth is a measure of complexity:

”To summarize 2.5 million years of economic history in brief: for a very, very long time not much happened; then all of a sudden all hell broke loose. It took 99.4% of economic history to reach the wealth levels of the Yanomamo, 0.59% to double that level by 1750, and then just 0.01% for global wealth to reach the level of the modern world”

Or we can look at it from the point of view of the supply-chains that are required to transform raw materials into products and services that criss-cross the globe. It is said that a modern car manufacturer has about 15,000 inputs to the manufacturing process. If each of those components was made by a supplier who put  together on average 1500 components (10%), and each of those was put together by a supplier who put together 150 components, that makes over 3 billion interactions- and we have not included staff, plant, production lines, IT and financial systems. Nor are we at the end of the story here.

For the car manufacturer would not exist were there not customers who could afford to buy a new car, which depends upon their economic outputs which are themselves dependent upon vast complex supply chains, and so on. Nor could these vast networks of exchange exist without transport, finance, and communications networks. And those networks would not be economically viable unless they were benefiting from the economies of scale shared with many other products and services. In this way we can start to see how intimately connected we are with one another across the planet, and why we see the global economy as a singular system

All you could ever want to know about why complexity is THE big deal

This video by David Korowicz [Complexity, Economy, Civilisation & Collapse] will answer the questions you may not have even thought to ask yourself (or others). His holistic perspective, born out of inter-disciplinary thinking tells you all you need to know about complexity, the folly of a “silo mentality” and the power of interdependence.

DK provides some superb illustrations including something as, apparently, simple as buying a loaf. At the other end of the scale he deals (briefly) with Thermodynamics and the “unseen” complexity of the Global Supply Chain driven by supply and demand. Complexity is the link. Read more of this post