21st Century Economics

This report was originally created in July 1999 but is as relevant today as it was then. In fact, most of what it predicted has happened and the opportunities for profits (or not taking large losses) have increased.

What happens to our air is critical to our economy.
If it changes, even slightly, we will feel the financial, health and food effects of it. As a global megatrend, it has far reaching implications on the financial well being of every nation on earth but especially the US. For that reason, it is important to understand the forces at work here.

Life as we know it is possible on Earth because of a natural greenhouse effect that keeps our planet about 60o F warmer than it otherwise would be. Water vapor, carbon dioxide (CO2 ), and other trace gases, such as methane and nitrous oxide, trap solar heat and slow its loss by re-radiation back to space. With industrialization and population growth, greenhouse gas emissions from human activities have consistently increased. These steady additions have begun to tip a delicate balance, significantly increasing the amount of greenhouse gases in the atmosphere, and enhancing their insulating effect.

A wide variety of activities contribute to greenhouse gas emissions.
Burning of coal, oil, and natural gas releases about 6 billion tons of carbon into the atmosphere each year worldwide. Burning and logging of forests contributes another 1-2 billion tons annually by reducing the storage of carbon by trees. The result is that the atmospheric level of CO2, the most important human-derived greenhouse gas, has increased 30 percent, fro m 280 to 360 parts per million (ppm) since 1860. Over the same time period, agricultural and industrial practices have also substantially increased the levels of other potent greenhouse gases — methane concentrations have doubled and nitrous oxide levels have risen by about 15 percent. These gases have atmospheric lifetimes ranging from decades to centuries; today’s emissions will be affecting the climate well into the 21st century.

The overall emissions of greenhouse gases are growing at about 1 percent per year. For millennia, there has been a clear correlation between CO2 levels and the global temperature record. Fluctuations of CO2 and temperature have roughly mirrored each other over the last 160,000 years. The current level of CO2 is already far higher than it has been at any point during this period. If current emissions trends continue over the next century, concentrations will rise to levels not seen on the planet for 50 million years.

Which countries account for the largest proportions of CO2 emissions?
In 1995, 73 percent of the total CO2 emissions from human activities came from the developed countries. The United States is the largest single source, accounting for 22 percent of the total, with carbon emissions per person now exceeding 5 tons per year. Over the next few decades, 90 percent of the world’s population growth will take place in the developing countries, some of which are also undergoing rapid economic development. Per capita energy use in the developing countries, which is currently only 1/10 to 1/20 of the U.S. level, will also increase. If current trends continue, the developing countries will account for more than half of total global CO2 emissions by 2035. China, which is currently the second largest source, is expected to have displaced the United States as the largest emitter by 2015.

Opportunities for Profit

These reports on the megatrend of global warming and ocean rise are not so much meant to present immediate investment opportunities as to alert you to an inevitable trend that will eventually affect all of us. This is not speculation but scientific fact. Unfortunately, it is not in our nature to react ro respond to events that unfold very slowly. Our government and that of many other nations will never put global warming above more immediate issues related to current economic growth and prosperity. For that reason, there will be virtually no preventive measures and no preparation for the eventual effects.

Because there are a few scientists that do understand the coming event and can foresee the impact it will have on society and our economy, they must be silenced so as to not upset the rest of us in our ignorant bliss. To that end, the government will frequently offer up studies that contradict those of established scientists so that the public will remain confused and non-responsive to the warnings. This also allows the government to push off any response until it actually begins to affect our economy - i.e., take money out of the pockets of corporate America - THEN we will address the issues and begin to prepare. Unfortunately, that will be very late in the process and little will be able to be done without major upheavals and deep changes that affect many people.