Monday, October 9, 2006

The Future Constrained Environment

Well at least I know someone actually reads this blog. I received an email from a real estate investor who wanted to know what the price of wheat had to do with my theory on a pending energy crisis.

On October 2, 2006, I published a blog titled “Energy Constrained, Carbon Constrained”. I view the competition for investment dollars through a filter of declining liquid petroleum availability AND a filter of soon to come regulation of carbon emissions. At the moment, the political will necessary to tackle these issues is not apparent. That will change rather quickly should the supply of grains needed to feed the world’s people come under attack from weather patterns caused by global warming or the inability of farmers to afford hydrocarbon based fertilizer, pesticide, and other hydrocarbon inputs based on today’s agricultural product's economic yields.

Is there a connection between declining grain supplies and energy and environmental issues? It is really not a big reach. Would governments get off their butts if the supply constraints experienced in energy last year suddenly appeared in the supply chain for food? You can take that to the bank – history clearly shows that real hunger is a powerful motivator. Would the policies enacted affect your investments? I believe that they would, and that’s why I wrote about the shortage, at least for the time being, of grain. That these issues are arising contemporaneously is not, I believe, a coincidence. And that the proposed substitution/soultion for liquid transportaion fuels is to be found in the distillation of grains - well, as I said - I am convinced people would choose eating over driving.

Mentatt (at) yahoo (dot) com

No comments: