by Charles Hugh Smith
Daily Reckoning
Finance is often cloaked in arcane terminology and math, but the one dynamic that governs the future is actually very simple. Here it is:
All debt is borrowed against future supplies of affordable hydrocarbons (oil, coal and natural gas).
Since global economic activity is ultimately dependent on a continued abundance of affordable energy, it follows that all money borrowed against future income is actually being borrowed against future supplies of affordable energy.
Many people believe that alternative “green” energy will soon replace most or all hydrocarbon energy sources, but this belief is not realistic. All the “renewable” energy sources are about 3% of all energy consumed, with hydropower providing another few percent.